As filed with the Securities and Exchange Commission on April 15, 2009

Registration No. 33-96668

811-09092

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933	x

PRE-EFFECTIVE AMENDMENT NO.	o


POST-EFFECTIVE AMENDMENT NO. 15	x


AND/OR

REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940

AMENDMENT NO. 17

(Check appropriate box or boxes)

FIRST EAGLE VARIABLE FUNDS

(Exact name of registrant as specified in charter)

1345 Avenue of the Americas
New York, NY 10105
(Address of principal executive offices)

Registrant’s Telephone Number, including Area Code: (212) 698-3000

Robert Bruno
First Eagle Variable Funds
1345 Avenue of the Americas
New York, NY 10105
(Name and address of agent for service)

Copy To:
Nathan J. Greene, Esq.
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022

It is proposed that this filing will become effective (check appropriate box):

Immediately upon filing pursuant to paragraph (b)

On April 30, 2009 pursuant to paragraph (b) of Rule 485

	o	60 days after filing pursuant to paragraph (a)(1)
	o	On (date) pursuant to paragraph (a)(1) of Rule 485
	o	75 days after filing pursuant to paragraph (a)(2)
	o	On (date) pursuant to paragraph (a)(2) of Rule 485

If appropriate, check the following box:

This post-effective amendment designates a new effective date for a previously filed post- effective amendment.

Title of Securities Being Registered:
First Eagle Overseas Variable Fund—Common Stock

First Eagle Variable Funds

First Eagle Overseas
Variable Fund

Prospectus
April 30, 2009

Advised by Arnhold and S. Bleichroeder Advisers, LLC

As with all mutual funds, these securities have neither been approved nor disapproved by the Securities and Exchange Commission nor has the SEC passed on the accuracy of this prospectus. It is a criminal offense to claim otherwise.

Welcome to First Eagle Variable Funds (the 'Trust'), managed by Arnhold and S. Bleichroeder Advisers, LLC (the 'Adviser' or 'ASB Advisers'), a subsidiary of Arnhold and S. Bleichroeder Holdings, Inc. ('ASB Holdings').

John P. Arnhold is Chairman and Chief Executive Officer of the Adviser and also serves as President and Trustee of the Trust; he is the senior executive responsible for managing the business and affairs of the Adviser and the Trust. Matthew McLennan and Abhay Deshpande make up the portfolio management team for First Eagle Overseas Variable Fund (the 'Fund'). Jean-Marie Eveillard, the Fund's prior portfolio manager, now serves in an advisory position with ASB Advisers in which he provides investment consultation and advice to the Fund's portfolio management team and to senior management of ASB Advisers.

The Fund is a separate portfolio of the Trust, an open-end management investment company, that offers its shares only to separate accounts of U.S. insurance companies to serve as an investment medium for variable life insurance policies and variable annuity contracts issued by the insurance companies.

Investment Objective

First Eagle Overseas Variable Fund seeks long-term growth of capital.

Before you invest in a mutual fund, you need to know that all mutual funds have common attributes:

• Shares of the mutual fund can fluctuate in value.

• You could make money or lose money.

• There is no guarantee that a fund will achieve its investment objective.

This prospectus tells you about our Fund. We encourage you to read it carefully before you decide to invest and ask that you keep it for future reference.

TABLE OF CONTENTS

	Page
The Fund		1

About First Eagle Overseas Variable Fund		1

Objective and Approach		1

Principal Investment Risks		1

Disclosure of Portfolio Holdings		3

The Fund's Performance		3

Fees and Expenses		4

Our Management Team		4

The Adviser		4

Approval of Advisory Agreement		5

Distribution and Shareholder Services Expenses		5

About Your Investment		6

How to Purchase Shares		6

Anti-Money Laundering Compliance		7

How Fund Share Prices Are Calculated		7

Short-Term Trading of Fund Shares		7

Information on Dividends, Distributions and Taxes		8

Financial Highlights		9

Useful Shareholder Information (Back Cover)

THE FUND

About First Eagle Overseas Variable Fund

Objective and Approach

The investment objective of the Fund is long-term growth of capital. To achieve its objective, the Fund will invest primarily in equities, including common and preferred stocks, warrants or other similar rights, and convertible securities, issued by non-U.S. companies. The Fund may invest in securities traded in mature markets (for example, Japan, Germany and France) and in countries whose economies are still developing (often called "emerging markets"), and may invest in companies of all sizes, regardless of capitalization. The Fund particularly seeks companies that have financial strength and stability, strong management and fundamental value. However, the Fund may invest in companies that do not have all of these characteristics. Under normal circumstances, the Fund invests at least 80% of its total assets, taken at market value, in foreign securities. The Fund may invest up to 20% of its total assets in debt securities, including lower-rated securities and securities that are not rated. The Fund may also invest in precious metals, such as gold, and precious metal-related issues.

Although the Fund shares a similar name and investment objective to First Eagle Overseas Fund (a portfolio of the First Eagle Funds family), the two do not apply identical investment strategies. Among other differences, the Fund has tended to hold a more concentrated securities portfolio than has First Eagle Overseas Fund, which may make the Fund more susceptible to fluctuations in value than First Eagle Overseas Fund.

The investment objective of the Fund, as well as the 80% of assets test set out above, is not a fundamental policy and can be changed without shareholder approval. Shareholders will be notified a minimum of 60 days in advance of any change in investment objective.

Principal Investment Risks

Investing in the Fund involves various risks.

Market Risk

In general, a fund's share price fluctuates over the short term in reaction to stock market movements. This means that an investor could lose money over short periods, and perhaps over longer periods during extended market downturns.

For reasons not necessarily attributable to what are often referred to as a company's "fundamentals" (i.e., its prospects based on a measured analysis of its assets, management skills, market position, etc.), the price of a company's securities acquired by the Fund may decline substantially. Investing at what may appear to be "undervalued" levels is no guarantee that the purchased assets will not be trading at even more "undervalued" levels at a time of sale by the Fund.

Risks of Foreign Investments

Foreign securities involve certain inherent risks that are different from those of domestic securities, including political or economic instability of the issuer or the country of issue, changes in foreign currency and exchange rates, and the possibility of adverse changes in investment or exchange control regulations. Currency fluctuations will also affect the net asset value of the Fund irrespective of the performance of the underlying investments in foreign issuers. Typically, there is less publicly available information about a foreign company and foreign companies may be subject to less stringent reserve, auditing and reporting requirements. Many foreign stock markets are not as large or liquid as in the United States; fixed commissions on foreign stock exchanges are generally higher than the negotiated commissions on U.S. exchanges; and there is generally less government supervision and regulation of foreign stock exchanges, brokers and companies than in the United States. Foreign governments can also levy confiscatory taxes, expropriate assets and limit repatriations of assets. As a result of these and other factors, foreign securities purchased by the Fund may be subject to greater price fluctuation than securities of U.S. companies. These risks may be more pronounced with respect to investments in emerging markets, which generally are subject to greater risk of economic and political disruptions, greater price volatility, and may not be subject to the same accounting, financial and other reporting requirements as the securities markets of more developed countries.

Risks of Debt Securities

Securities with the lowest investment grade ratings are considered to be medium grade and to have speculative characteristics. Debt securities that are unrated are considered by the Adviser to be equivalent to below investment grade (often referred to as 'junk bonds'). On balance, debt securities that are below investment grade are considered predominately speculative with respect to the issuer's capacity to pay interest and repay principal according to the terms of the obligation and, therefore, carry greater investment risk, including the possibility of default and bankruptcy. They are likely to be less marketable and more adversely affected by economic downturns than higher-quality debt securities.

The Fund may invest in debt securities without considering the maturity of the instrument. Debt securities have varying levels of sensitivity to changes in interest rates. In general, the price of a debt security can fall when interest rates rise and can rise when interest rates fall. Securities with longer maturities can be more sensitive to interest rate changes. In other words, the longer the maturity of a security, the greater the impact a change in interest rates could have on the security's price. In addition, short-term and long-term interest rates do not necessarily move in the same amount or the same direction.

Risks of Small and Medium Size Companies

In addition to investments in larger companies, the Fund may invest in smaller and medium size companies, which historically have been more volatile in price than larger company securities, especially over the short term. Among the reasons for the greater price volatility are the less certain growth prospects of smaller companies, the lower degree of liquidity in the markets for such securities and the greater sensitivity of smaller companies to changing economic conditions. In addition, smaller companies may lack depth of management, they may be unable to generate funds necessary for growth or development, or they may be developing or marketing new products or services for which markets are not yet established and may never become established. The Fund considers small companies to be companies with market capitalizations of less than $1 billion and medium size companies to have market capitalizations of less than $10 billion.

Risks of Gold

The Fund may also invest in precious metals, such as gold, as well as precious metal-related issues. It is therefore susceptible to specific political and economic risks affecting the price of gold and other precious metals including changes in U.S. or foreign tax, currency or mining laws, increased environmental costs, international monetary and political policies, economic conditions within an individual country, trade imbalances and trade or currency restrictions between countries. The price of gold, in turn, is likely to affect the market prices of securities of companies mining or processing gold, and accordingly, the value of the Fund's investments in such securities may also be affected. Gold-related investments as a group have not performed as well as the stock market in general during periods when the U.S. dollar is strong, inflation is low and general economic conditions are stable. In addition, returns on gold-related investments have traditionally been more volatile than investments in broader equity or debt markets.

Although the risks related to investing in gold and other precious metals directly (as the Fund is authorized to do) are similar to those of investing in precious metal finance and operating companies, as just described, there are additional considerations, including custody and transaction costs that may be higher than those involving securities. Moreover, holding such metals results in no income being derived from such holding, unlike securities which may pay dividends or make other current payments. Investing in futures contracts and similar 'derivative' instruments related to precious metals also carries additional risks, in that these types of investments (i) are often more volatile than direct investments in the commodity underlying them, because they commonly involve significant 'built in' leverage, and (ii) are subject to the risk of default by the counterparty to the contract. Although the Fund has contractual protections with respect to the credit risk of its custodian, precious metals held in physical form (even in a segregated account) involves the risk of delay in obtaining the assets in the case of bankruptcy or insolvency of the custodian. This could impair disposition of the assets under those circumstances. Finally, although not currently anticipated, if such metals in the future were held in book account, it would involve risks of the credit of the party holding them.

Defensive Investment Strategies

The Fund may engage in currency exchange transactions to, among other reasons, hedge against losses in the U.S. dollar value of its portfolio securities resulting from possible variations in exchange rates. A currency exchange may

be conducted on a spot (i.e., cash) basis or through a forward currency exchange contract ('forward contract') or other cash management position. Although such hedged positions may be used to protect a fund from adverse currency movements, the use of hedges may reduce or eliminate potential profits from currency fluctuations that are otherwise in a fund's favor.

The Fund has the flexibility to respond promptly to changes in market and economic conditions. For example, a defensive strategy may be warranted during periods of unfavorable market or economic conditions, including periods of market turbulence or periods when prevailing market valuations are higher than those deemed attractive under the investment criteria generally applied on behalf of the Fund. Pursuant to a defensive strategy, the Fund may temporarily hold cash and/or invest up to 100% of its assets in high quality debt securities or money market instruments of U.S. or foreign issuers. Most or all of the Fund's investments during such period may be made in the U.S. and denominated in U.S. dollars. In such a case, the Fund may not be able to pursue, and may not achieve, its investment objective. It is impossible to predict whether, when or for how long the Fund will employ defensive strategies.

Disclosure of Portfolio Holdings

A description of the Fund's policies and procedures with respect to disclosure of its portfolio securities is available in the Fund's Statement of Additional Information, which is available upon request (see back cover).

The Fund's Performance

Many factors affect a fund's performance. The following information provides some indication of the risks of investing in the Fund by showing changes in the Fund's performance from year to year. It also compares the Fund's average annual returns during the periods indicated to those of a broad measure of market performance. The average annual returns shown below do not reflect charges imposed by the Variable Contracts, as defined herein, through which the Fund is offered and would be lower if those charges were reflected.

For the periods presented in the bar chart above, here is some additional return information.

Best Quarter					20.19	%		Second Quarter 2003
Worst Quarter					(12.41	)%		Third Quarter 2002

The following table illustrates how the Fund's average annual returns for different calendar periods compare to the return of the Morgan Stanley Capital International (MSCI) EAFE Index. The MSCI EAFE Index is a total return index, reported in U.S. dollars, based on share prices and reinvested net dividends of approximately 1,100 companies from 21 countries and is not available for purchase. The figures in the table assume that you sold your shares at the end of each period and are shown on a before-tax basis. (After-tax returns vary based on an investor's individual tax situation and are generally not relevant to investors who hold fund shares in tax-deferred arrangements, including most variable life insurance or variable annuity contracts.)

Average Annual Total Return Comparisons Table As of December 31, 2008

	1 Year			5 Years			10 Years
First Eagle Overseas Variable Fund		(18.82	)%		11.13	%		17.12	%
MSCI EAFE Index		(43.38	)%		1.66	%		0.80	%

Both the bar chart and table assume reinvestment of dividends and distributions. As with all mutual funds, past performance is not an indication of future performance.

FEES AND EXPENSES

The following information describes the fees and expenses you may pay if you buy and hold shares of the Fund. Operating expenses are paid from the Fund's assets and therefore are incurred by shareholders indirectly. The expenses shown below do not reflect charges imposed by the Variable Contracts, as defined herein, through which the Fund is offered. Please see your Variable Contract prospectus for more details on those charges.

First Eagle Overseas Variable Fund's Fees and Expenses

Annual Operating Expenses

Management Fees	0.75	%
Distribution (12b-1) Fees	0.25	%
Other Expenses*	0.32	%
Total Annual Operating Expenses**	1.32	%

* "Other expenses" include fees paid for miscellaneous items such as shareholder services, professional services, administrative services provided by ASB Advisers, and fees paid to certain financial intermediaries (e.g., insurance companies acting on behalf of their Variable Contract holders) for providing recordkeeping or other administrative services in connection with investments in the Fund.

** Amounts exclude earnings credits and may differ from the Fund's Financial Highlights.

Example

This example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. This hypothetical example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The example also assumes that the average annual return is 5% and operating expenses remain the same. The example does not represent the Fund's actual past or future expenses and returns. The example also does not reflect charges imposed by the Variable Contracts. See your Variable Contract prospectus for information on those charges.

Although your actual costs may be higher or lower, based on these assumptions, your costs would be:

				1 Year				3 Years				5 Years				10 Years
First Eagle Overseas Variable Fund				$	134			$	418			$	723			$	1,590

OUR MANAGEMENT TEAM

The Adviser

The Adviser of the Fund is Arnhold and S. Bleichroeder Advisers, LLC, a subsidiary of Arnhold and S. Bleichroeder Holdings, Inc. ("ASB Holdings"). Based in New York City since 1937, ASB Holdings is the successor firm to two German banking houses Gebr. Arnhold founded in Dresden in 1864 and S. Bleichroeder founded in Berlin in 1803. The Adviser offers a variety of investment management services. In addition to the Fund, its clients include the First Eagle Funds, foundations, major retirement plans and high net worth individuals. As of January 2009, the Adviser had more than $30 billion under management.

Matthew McLennan and Abhay Deshpande manage the Fund. The professional backgrounds of Messrs. McLennan and Deshpande are below.

Matthew McLennan manages the Fund with Mr. Deshpande and is the First Eagle Global Value Team Lead. Mr. McLennan assumed these positions when he joined the Adviser in September 2008 after having held various senior positions with Goldman Sachs Asset Management in London and New York. While at his predecessor firm for over fourteen years, Mr. McLennan was Chief Investment Officer of a London based investment team from 2003 to 2008 where he was responsible for managing a focused value-oriented global equity product and held positions from 1994 to 2003 that included portfolio management and investment analyst responsibilities for small-cap and mid-cap value equity portfolios.

Abhay Deshpande manages the Fund with Mr. McLennan. Mr. Deshpande joined the Adviser in 2000 and served as a senior member of the First Eagle Global Value Research Team and as a portfolio manager for a number of accounts for the Adviser before assuming his current management responsibilities for the Fund in September 2007. Prior to 2000, Mr. Deshpande spent three years as a research analyst with Harris Associates, investment adviser to the Oakmark Funds.

Additional information regarding these portfolio managers' compensation, other accounts managed by them and their ownership of securities in the Fund is available in the Statement of Additional Information ("SAI"). The portfolio managers are supported in their duties by a team of investment professionals employed by the Adviser, and certain background information regarding these investment professionals is also available in the SAI. Additionally, Jean-Marie Eveillard, the Fund's portfolio manager from its inception to 2004 and from March 2007 through March 2009, remains a Senior Advisor to the Adviser and continues to provide investment consultation and advice to the portfolio management team and to senior management of ASB Advisers.

Pursuant to an advisory agreement ('Advisory Agreement') with the Trust, the Adviser is responsible for the management of the Fund's portfolio and reviews its holdings in the light of its own research analyses and those of other relevant sources. In return for its investment management services, the Fund pays the Adviser a fee at the annual rate of the average daily value of the Fund's net assets as follows:

First Eagle Overseas Variable Fund

0.75

The Adviser also performs certain administrative, accounting, operations, compliance and other services on behalf of the Fund, and in accordance with its agreement with them, the Fund reimburses the Adviser for costs (including personnel, related overhead and other costs) related to those services. These reimbursements may not exceed an annual rate of 0.05% of the value of the Fund's average daily net assets.

Approval of Advisory Agreement

For your reference, a discussion regarding the basis of the Board of Trustees' approval of the Advisory Agreement is available in the Annual Report to Shareholders for the financial reporting period ended December 31 of each year.

Distribution and Shareholder Services Expenses

The Fund's shares are offered, in states and countries in which such offer is lawful, to investors either through selected securities dealers or directly by First Eagle Funds Distributors, a division of ASB Securities LLC ('First Eagle Distributors' or the 'Distributor'), the Fund's principal underwriter and a wholly owned subsidiary of ASB Holdings.

The Fund has adopted a Distribution Plan and Agreement (the 'Plan') pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Plan, the Fund pays First Eagle Distributors a quarterly distribution-related fee at an annual rate of 0.25% of the average daily value of the Fund's net assets. Under the Plan, the Fund is authorized to make payments to First Eagle Distributors for remittance to an insurance company that is the issuer of a variable life insurance contract or variable annuity contract (each, a 'Variable Contract') invested in shares of the Fund in order to pay or reimburse such insurance company for distribution and shareholder servicing-related expenses incurred or paid by such insurance company. First Eagle Distributors or its affiliates bear distribution expenses to the extent that they are not covered by payments under the Plan. Any distribution expenses incurred by First Eagle Distributors or its affiliates in any fiscal year of the Fund, that are not reimbursed from payments accrued during such fiscal year, will not be carried over for payment in any subsequent year. Because these fees are paid from the Fund's assets on an on-going basis, over time these fees will increase the cost of an investment in the Fund and ultimately may cost more than paying other types of sales charges. The Plan may be terminated without the payment of any penalty by the vote of the holders of a majority of the outstanding voting securities of the Fund.

Insurance companies perform services for the Fund that are normally handled by a mutual fund's transfer agent. These services may include client statements, tax reporting, order-processing and client relations. As a result, these third parties may charge the Fund for these services. These sub-transfer agency fees paid by the Fund are, in aggregate, no more than what the Fund otherwise would have paid to DST Systems Inc. ("DST Systems"), the Fund's transfer agent, for the same services. Arrangements may involve a per-account fee, an asset-based fee, a sales-based fee or, in some cases, a combination of the three. These fees, which comprise a substantial portion of the Fund's ongoing expenses, are directly attributable to the Variable Contract holder serviced by the relevant party. (While the Adviser and the Distributor consider these to be payments for services rendered, they represent an additional business relationship between these sub-transfer agents and the Fund that often results, at least in part, from past or present sales of Fund shares by the sub-transfer agents or their affiliates.)

Revenue Sharing

The Distributor, Adviser or an affiliate may make cash payments from its own resources to insurance companies or their representatives for various reasons. These payments, often referred to as "revenue sharing," may support the delivery of services to the Fund or to shareholders in the Fund, including transaction processing and sub-accounting services. These payments also may serve as an incentive to sell Fund shares and/or to promote shareholder retention. As such, the payments may go to firms providing various marketing support or other promotional services relating to the Fund, including advertising and sales meetings, as well as inclusion of the Fund in various promotional and sales programs. Marketing support services also may include business planning assistance, educating insurance company personnel about the Fund and shareholder financial planning assistance.

Revenue sharing payments may include any portion of the sub-transfer agency fees (described in the preceding section of the Prospectus) that exceed the costs of similar services provided by the Fund's transfer agent, DST Systems. They also may include any other payment requirement of an insurance company or another third-party intermediary. All such payments are paid by the Distributor, the Adviser or an affiliate of either out of its (or their) own resources. Such payments are in addition to any Rule 12b-1 payments described elsewhere in this Prospectus. Revenue sharing payments may be structured as: (i) a percentage of sales; (ii) a percentage of net assets; (iii) a fixed dollar amount; or (iv) some combination of any of these. In many cases, revenue sharing arrangements may be viewed as encouraging sales activity or retention of assets in the Fund. Generally, any revenue sharing or similar payments are requested by the party receiving them, often as a condition of distribution, but are subject to negotiation as to their structure and scope.

The Distributor, Adviser or an affiliate also may pay from its own resources for travel and other expenses, including lodging, entertainment and meals, incurred by insurance companies or their representatives related to diligence or for attending informational meetings in which insurance company representatives meet with the Fund's investment professionals. The Distributor, Adviser or an affiliate also may pay for costs of organizing and holding such meetings and also may make payments to or on behalf of insurance companies or their representatives for other types of events, including preapproved conferences, seminars or training programs (and payments for travel, lodging, etc.), and may provide certain small gifts and/or entertainment as permitted by applicable rules.

A shareholder or prospective Variable Contract investor should be aware that revenue sharing arrangements or other payments to intermediaries could create incentives on the part of the parties receiving the payments to more positively consider the Fund relative to mutual funds either not making payments of this nature or making smaller such payments. A shareholder or prospective Variable Contract investor with questions regarding revenue sharing or other such payments may obtain more details by contacting his or her financial intermediary directly.

ABOUT YOUR INVESTMENT

How to Purchase Shares

Shares of the Fund may be offered for purchase by separate accounts of insurance companies for the purpose of serving as an investment medium for Variable Contracts. Shares of the Fund are sold at their net asset value (without a sales charge) next computed after a receipt of a purchase order by an insurance company whose separate account invests in the Fund. These insurance companies also may impose certain handling charges in connection with transactions in Fund shares and may have particular requirements relating to processing transactions. For information on how to purchase shares (and details relating to any such handling charges or other processing requirements), please refer to the prospectus of the pertinent separate account.

Shares of the Fund are sold to insurance company separate accounts funding both variable annuity contracts and variable life insurance contracts and may be sold to insurance companies that are not affiliated. The Trust currently does not foresee any disadvantages to Variable Contract owners arising from offering the Fund's shares to separate accounts of unaffiliated insurers, or separate accounts funding both life insurance policies and annuity contracts; however, due to differences in tax treatment or other considerations, it is theoretically possible that the interests of owners of various contracts participating in the Fund might at some time be in conflict. The Trust's Board of Trustees and insurance companies whose separate accounts invest in the Fund are required to monitor events in order to identify any material conflicts between variable annuity contract owners and variable life policy owners, and between separate accounts of unaffiliated insurers. The Board of Trustees will determine what action, if any, should be taken in the event of such a conflict. If such a conflict were to occur, one or more insurance company separate accounts might withdraw their investment in the Fund. This could force the Fund to sell securities at disadvantageous prices.

The Trust and First Eagle Distributors each reserves the right to refuse any order for purchase of shares and to cancel any purchase for any reason it deems appropriate. Any such cancellation, other than for nonpayment or to correct certain administrative errors, will be effected within two business days of such purchase order.

The Distributor may authorize certain intermediaries to receive on its behalf purchase and redemption orders. In turn, these parties may designate other intermediaries to receive purchase and redemption orders on the Distributor's behalf. Orders for shares received by DST or any of these authorized or designated intermediaries prior to the close of trading on the NYSE will be processed based on that day's net asset value determined as of the close of trading on the NYSE that day. If an order is received by DST or an authorized or designated intermediary after the close of the NYSE, it will be priced the next day the NYSE is open for trading.

Anti-Money Laundering Compliance

The Trust, the Distributor and the insurance companies issuing the Variable Contracts are required to comply with various anti-money laundering laws and regulations. Consequently, additional information regarding your identity and source of funds may be required of you. If the information submitted does not provide for adequate identity verification, you may not be able to establish an account with your insurance company or that account may be closed at the then-current net asset value. Similarly, suspicious account activity or account information matching that on government lists of suspicious persons may prevent establishment of an account or may require 'freezing' an account, reporting to governmental agencies or other financial institutions or the transfer of account assets to governmental agencies. In some circumstances, the law may not permit notification to the affected account holder of these actions.

How Fund Share Prices Are Calculated

Net asset value of the Fund is determined as of the close of trading on the New York Stock Exchange ('NYSE') on each day the NYSE is open for trading. The holidays when the NYSE is closed and rules regarding closing the NYSE can be found on the NYSE's website at www.nyse.com. The net asset value per share is computed by dividing the total current value of the assets of the Fund (less its total liabilities) by the total number of shares outstanding. Because the Fund will invest in securities listed on foreign exchanges that may trade on weekends or other days when the Fund does not price its shares, the Fund's share value may change on days when shareholders will not be able to purchase or redeem shares.

The Fund uses pricing services to identify the market prices of publicly traded securities in its portfolio. When market prices are determined to be 'stale' due to limited market activity for a particular holding, or in other circumstances when market prices are unavailable, such as for private placements, or determined to be unreliable for a particular holding, such holdings may be 'fair valued' in accordance with procedures approved by the Board of Trustees. Additionally, with respect to foreign holdings, specifically in circumstances leading the Adviser to believe that significant events occurring after the close of a foreign market have materially affected the value of the Fund's holdings in that market, such holdings will be fair valued to reflect the events in accordance with procedures approved by the Board. Also in accordance with procedures approved by the Board, the determination of whether a particular foreign investment should be fair valued will be based on review of several factors, including developments in foreign markets, the performance of U.S. securities markets, and security-specific events. The Fund has adopted procedures under which movements in the prices for U.S. securities (beyond specified thresholds) occurring after the close of a foreign market generally require fair valuation of securities traded on that foreign market. Therefore, the values assigned to the Fund's holdings may differ from reported market values, especially during periods of higher market price volatility. The Trust and the Adviser believe relying on the procedures described above will result in prices that are more reflective of the actual market value of portfolio securities held by the Fund.

Short-Term Trading of Fund Shares

The Fund discourages frequent trading and will not knowingly accommodate frequent traders. Frequent trading of Fund shares may, among other things, increase Fund transaction and administrative costs, require the Fund to keep a larger percentage of its assets in cash than might be desirable absent such trading, and/or otherwise negatively impact the Fund's investment program, possibly diluting the Fund's value to its longer-term investors. The Fund may be particularly susceptible to these risks due to its significant investments in foreign securities. Pursuant to procedures approved by the Board of Trustees, the Fund seeks to identify and deter inappropriate trading and, if identified and not timely addressed by the relevant insurance company sponsor to the satisfaction of the Fund, will suspend trading privileges or close accounts of the relevant insurance company sponsor and provide notice of such suspension or closing of such account to that sponsor. Specifically, the Fund seeks to identify the types of transactions that may be harmful to the Fund, either on an individual basis or as part of a pattern. In certain circumstances, based on the review of a number of factors (which may include the size of the transaction, the

timing of the trade instructions and relevant market conditions), the Fund may deem a single trade or exchange to be inappropriate and subject to these procedures.

The Fund also may deem individual contract holders to be potential short-term traders (and subject to trading suspensions or account closures without advance notice) based on information unrelated to the specific trades in a person's account. For example, the Fund may obtain information linking an account to an account previously suspended or closed for inappropriate trading. In addition, a reliable third party may report short-term trading concerns regarding a particular account to the Fund.

However, the Fund depends on cooperation from the insurance company sponsors of the Variable Contracts in reviewing individual contract holder trading activity, which limits the Fund's ability to monitor and discourage such trading at that level. If the Fund is unable to identify and prevent inappropriate trading (either on its own or in cooperation with the insurance company sponsors), the adverse effects described above will be more likely to occur. The Fund does not have any arrangements intended to permit trading in contravention of the policies described in this paragraph and applies these policies uniformly as to any instances of identified inappropriate trading.

INFORMATION ON DIVIDENDS, DISTRIBUTIONS AND TAXES

It is the policy of the Fund to make periodic distributions of net investment income and net realized capital gains, if any. Unless a shareholder elects otherwise, ordinary income dividends and capital gains distributions will be reinvested in additional shares of the Fund at net asset value per share calculated as of the payment date. The Fund pays ordinary income dividends and capital gains distributions on a per-share basis. As a result, on the ex-dividend date of such a payment, the net asset value per share of the Fund will be reduced by the amount of such payment.

The Fund intends to qualify and has elected to be treated as a 'regulated investment company' under Subchapter M of the Internal Revenue Code of 1986, as amended (the 'Code'). To qualify, the Fund must meet certain income, diversification and distribution requirements. As a regulated investment company, the Fund generally will not be subject to federal income or excise taxes on ordinary income and capital gains distributed to shareholders within applicable time limits, although foreign-source income received by the Fund may be subject to foreign withholding taxes.

The Fund also intends to comply with the diversification regulations under Section 817(h) of the Code. These diversification requirements, which are in addition to the diversification requirements set forth in Subchapter M of the Code, place certain limitations on the assets of a Variable Contract that may be invested in the securities of a single issuer or a certain number of issuers. Because Section 817(h) of the Code and the related Treasury Regulations thereunder treat the assets of the Fund as the assets of the Variable Contract, the Fund will satisfy these requirements to assist the Variable Contracts in complying with these requirements. If the Fund failed to satisfy these requirements, a variable annuity or variable life insurance product supported by a Variable Contract investing in the Fund may not be eligible for treatment as an annuity or as life insurance for tax purposes, and would no longer be eligible for tax deferral. Generally, the Fund will diversify its investments so that on the last day of each quarter of a calendar year no more than 55% of the value of its total assets is represented by any one investment, no more than 70% is represented by any two investments, no more than 80% is represented by any three investments, and no more than 90% is represented by any four investments. For this purpose, securities of a given issuer generally are treated as one investment, but each U.S. Government agency and instrumentality is treated as a separate issuer.

Foreign governments may withhold taxes on dividends and interest earned by the Fund with respect to foreign securities. Foreign governments also may impose taxes on other payments or gains with respect to foreign securities.

The Fund expects that any distributions to Variable Contract investors will be exempt from current federal income taxation to the extent such distributions accumulate in a variable annuity contract or variable life insurance policy. For a discussion of the tax consequences of variable annuity contracts or variable life insurance policies, please refer to the prospectus offered by the participating insurance company.

Tax issues can be complicated. Please consult your tax adviser about federal, state, or local tax consequences or with any other tax questions you may have.

FINANCIAL HIGHLIGHTS

The Financial Highlights Table is intended to help you understand the Fund's financial performance for the past five fiscal years. Certain information reflects financial results for a single Fund share. The total returns in the table represent the rate an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all dividends and distributions).

The Financial Highlights Table was derived from the Fund's financial statements, which were audited by PricewaterhouseCoopers LLP, 300 Madison Avenue, New York, New York 10017-6204 (for the Fund's fiscal year ended December 31, 2006, December 31, 2007 and December 31, 2008). The report of PricewaterhouseCoopers LLP (for the Fund's fiscal year ended December 31, 2008), together with the Fund's financial statements, are contained in the annual report for the Fund for that period and are incorporated by reference in the Statement of Additional Information. Information reported for fiscal years before 2006 was audited by the Fund's former independent registered public accounting firm. The annual reports and the Statement of Additional Information are available upon request.

Selected data for a share of beneficial interest outstanding throughout each year is presented below:

	For the Year Ended December 31,
	2008			2007			2006			2005			2004
Selected Per Share Data ^a
Net asset value, beginning of year	$	29.56		$	27.42		$	30.47		$	27.48		$	22.58
Income from investment operations:
Net investment income		0.43			0.38			0.39			0.27			0.23
Net realized and unrealized gains (losses) on investments		(6.02	)		1.76			7.21			5.58			5.92
Total from investment operations		(5.59	)		2.14			7.60			5.85			6.15
Less distributions:
From net investment income		(0.35	)		—			(2.42	)		(0.69	)		(0.61	)
From net realized gains		(2.82	)		—			(8.23	)		(2.17	)		(0.64	)
		(3.17	)		—			(10.65	)		(2.86	)		(1.25	)
Net asset value, end of year	$	20.80		$	29.56		$	27.42		$	30.47		$	27.48
Total Return		(18.82	)%		7.80	%		25.08	%		21.46	%		27.50	%
Ratios and Supplemental Data
Net assets, end of year (000's)	$	279,671		$	314,650		$	249,054		$	209,581		$	179,253
Ratio of operating expenses to average net assets ^b		1.32	%		1.23	%		1.24	%		1.25	%		1.31	%
Ratio of net investment income to average net assets ^c		1.60	%		1.28	%		1.13	%		0.90	%		0.95	%
Portfolio turnover rate		9.09	%		53.65	%		28.30	%		32.76	%		32.43	%

a Per share amounts have been calculated using the average shares method.

b The annualized ratios of operating expenses to average net assets for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 would have been 1.32%, 1.23%, 1.24%, 1.25%· and 1.31%, respectively, without the effects of the earnings credits.

c The annualized ratios of net investment income to average net assets for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 would have been 1.60%, 1.28%, 1.13%, 0.90% and 0.95%, respectively, without the effects of the earnings credits.

USEFUL SHAREHOLDER INFORMATION

How to Obtain Our Shareholder Reports

You will receive copies of our Annual and Semi-Annual Reports on a regular basis once you become a shareholder. These Reports also are available to you without charge from us. The Annual Report contains a discussion of the market conditions and investment strategies that significantly affected the Fund's performance during the last fiscal year. It also contains financial statements by the Fund's independent accountants.

How to Obtain Our Statement of Additional Information

The Statement of Additional Information ("SAI"), which is referenced in this prospectus is available to you without charge from us. You may visit the SEC's Internet Website (http://www.sec.gov) to view the SAI and other information. Also, you can obtain copies of the SAI by sending your request and fee to the SEC's Public Reference Section, Washington, D.C. 20549-0102 or by e-mail to publicinfo@sec.gov. You also may review and copy information about the Fund, including the SAI, at the SEC's Public Reference Room in Washington, D.C. To find out more about the Public Reference Room, call the SEC at (202) 551-8090.

How to Reach First Eagle Variable Funds

You can send all requests for information to:
First Eagle Variable Funds
1345 Avenue of the Americas
New York, NY 10105

You can contact us by telephone at (800) 747-2008

Distributor

First Eagle Funds Distributors, a division of ASB Securities LLC
1345 Avenue of the Americas
New York, NY 10105

Adviser

Arnhold and S. Bleichroeder Advisers, LLC
1345 Avenue of the Americas
New York, NY 10105

Investment Company Act File Number: 811-09092

STATEMENT OF ADDITIONAL INFORMATION

First Eagle Overseas Variable Fund

A Series of First Eagle Variable Funds

April 30, 2009

1345 Avenue of the Americas
New York, NY 10105
(212) 698-3000

Arnhold and S. Bleichroeder Advisers, LLC
1345 Avenue of the Americas
New York, NY 10105
Investment Adviser

First Eagle Funds Distributors
A Division of ASB Securities LLC
1345 Avenue of the Americas
New York, NY 10105
Distributor

This Statement of Additional Information provides information about First Eagle Overseas Variable Fund (the "Fund"), a separate portfolio of First Eagle Variable Funds (the "Trust"), an open-end management investment company, in addition to the information contained in the Prospectus of the Fund dated April 30, 2009. This Statement of Additional Information is not a prospectus. It relates to and should be read in conjunction with the Prospectus of the Trust, a copy of which can be obtained by writing or by calling the Trust at (800) 747-2008.

Certain disclosures, including the Fund's financial statements and the notes thereto, have been incorporated by reference into this Statement of Additional Information from the Trust's annual reports. For a free copy of the annual report, please call (800) 747-2008.

April 30, 2009

TABLE OF CONTENTS

	Statement of Additional Information
	Page
Organization of the Fund		1

Investment Objective, Policies and Restrictions		2

Management of the Trust		13

Investment Advisory and Other Services		20

Portfolio Managers		21

Conflicts of Interest		23

Voting of Proxies		24

Distribution of the Fund's Shares		24

Computation of Net Asset Value		26

Disclosure of Portfolio Holdings		27

How to Purchase Shares		28

Tax Status		28

Portfolio Transactions and Brokerage		32

Fund Shares		34

Custody of Portfolio		34

Independent Registered Public Accounting Firm		34

Financial Statements		34

Appendix		A-1

ORGANIZATION OF THE FUND

First Eagle Overseas Variable Fund (the "Fund") is a separate portfolio of First Eagle Variable Funds (the "Trust"), an open-end management investment company that was originally incorporated under the laws of Maryland in September 1995. The shareholders of the Trust approved reorganization of the Fund as a Delaware statutory trust, effective April 2004. Prior to the reorganization, the Trust operated under the names "First Eagle SoGen Variable Funds, Inc." and (prior to December 31, 1999) "SoGen Variable Funds, Inc." The Trust's investment adviser is Arnhold and S. Bleichroeder Advisers, LLC ("ASB Advisers" or the "Adviser"), a registered investment adviser. The Trust's distributor is First Eagle Funds Distributors, a division of ASB Securities LLC ("First Eagle Distributors" or the "Distributor"), a registered broker-dealer located in New York. Both ASB Advisers and ASB Securities LLC are subsidiaries of Arnhold and S. Bleichroeder Holdings, Inc. ("ASB Holdings"), a privately owned holding company organized under the laws of New York.

Pursuant to the laws of Delaware, the Trust's state of formation, the Board of Trustees of the Trust has adopted By-Laws that do not require annual meetings of the Fund's shareholders. The absence of a requirement that the Trust hold annual meetings of the Fund's shareholders reduces its expenses. Meetings of shareholders will continue to be held when required by the Investment Company Act of 1940, as amended (the "Investment Company Act") or Delaware law, or when called by the Chairman of the Board of Trustees, the President or shareholders owning 10% of the Fund's outstanding shares. The cost of any such notice and meeting will be borne by the Fund.

Under the provisions of the Investment Company Act, a vacancy on the Board of Trustees of the Trust may be filled between meetings of the shareholders of the Trust by vote of the trustees then in office if, immediately after filling such vacancy, at least two-thirds of the trustees then holding office have been elected to the office of Trustee by the shareholders of the Trust. In the event that at any time less than a majority of the Trustees of the Trust holding office at that time were elected by the shareholders of the Trust, the Board of Trustees or the Chairman of the Board shall, within sixty days, cause a meeting of shareholders to be held for the purpose of electing trustees to fill any vacancies in the Board of Trustees.

The staff of the Securities and Exchange Commission (the "SEC") has advised the Trust that it interprets Section 16(c) of the Investment Company Act, which provides a means for dissident shareholders of common-law trusts to communicate with other shareholders of such trusts and to vote upon the removal of trustees upon the request in writing by the record holders of not less than 10 percent of the outstanding shares of the trust, to apply to investment companies, such as the Trust, that are organized under Delaware law.

INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS

Investment Objective

The Fund, which is a diversified portfolio, seeks long-term growth of capital. The Fund uses the techniques and invests in the types of securities described below and in the Fund's Prospectus.

Investment Policies, Techniques and Risks

Foreign Securities. The Fund will invest in foreign securities, which may entail a greater degree of risk (including risks relating to exchange rate fluctuations, tax provisions, or expropriation of assets) than does investment in securities of domestic issuers. The Fund may invest in securities of foreign issuers directly or in the form of American Depository Receipts (ADRs), Global Depository Receipts (GDRs), European Depository Receipts (EDRs), or other securities representing underlying shares of foreign issuers. Positions in these securities are not necessarily denominated in the same currency as the common stocks into which they may be converted. ADRs are receipts typically issued by an American bank or trust company evidencing ownership of the underlying securities. EDRs are European receipts evidencing a similar arrangement. GDRs are global offerings where two securities are issued simultaneously in two markets, usually publicly in non-U.S. markets and privately in the U.S. market. Generally ADRs, in registered form, are designed for use in the U.S. securities markets, EDRs, in bearer form, are designed for use in European securities markets. GDR's are designed for use in the U.S. and European securities markets. The Fund may invest in both "sponsored" and "unsponsored" ADRs. In a sponsored ADR, the issuer typically pays some or all of the expenses of the depository and agrees to provide its regular shareholder communications to ADR holders. An unsponsored ADR is created independently of the issuer of the underlying security. The ADR holders generally pay the expenses of the depository and do not have an undertaking from the issuer of the underlying security to furnish shareholder communications. Issuers of unsponsored ADRs are not obligated to disclose material information in the United States and, therefore, there may not be a correlation between such information and the market value of the ADRs. The Fund does not expect to invest 5% or more of its total assets in unsponsored ADRs.

With respect to portfolio securities that are issued by foreign issuers or denominated in foreign currencies, the investment performance of the Fund is affected by the strength or weakness of the U.S. dollar against these currencies. For example, if the dollar falls in value relative to the Japanese yen, the dollar value of a yen-denominated stock held in the portfolio will rise even though the price of the stock remains unchanged. Conversely, if the dollar rises in value relative to the yen, the dollar value of the yen-denominated stock will fall. (See also the discussion under "Currency Exchange Transactions.")

Investors should understand and consider carefully the risks involved in foreign investing. Investing in foreign securities, positions which are generally denominated in foreign currencies, and utilization of forward foreign currency exchange contracts (or other foreign cash management positions) involve certain risks and opportunities not typically associated with investing in U.S. securities. These considerations include: fluctuations in the rates of exchange between the U.S. dollar and foreign currencies; possible imposition of exchange control regulations or currency restrictions that would prevent cash from being brought back to the United States; less public information with respect to issuers of securities; less governmental supervision of stock exchanges, securities brokers, and issuers of securities; different accounting, auditing and financial reporting standards; different settlement periods and trading practices; less liquidity and frequently greater price volatility in foreign markets than in the United States; imposition of foreign taxes; and sometimes less advantageous legal, operational and financial protections applicable to foreign sub-custodial arrangements.

Although the Fund seeks to invest in companies and governments of countries having stable political environments, there is the possibility of expropriation or confiscatory taxation, seizure or nationalization of foreign bank deposits or other assets, establishment of exchange controls, the adoption of foreign government restrictions, or other adverse political, social or diplomatic developments that could affect investment in these nations.

The cost of investing in foreign securities is higher than the cost of investing in U.S. securities. Investing in the Fund is an efficient way for an individual to participate in foreign markets, but its expenses, including advisory and custody fees, are higher than the expenses of many mutual funds that invest in domestic equities.

Currency Exchange Transactions. A currency exchange transaction by the Fund may be conducted either on a spot (i.e., cash) basis at the spot rate for purchasing or selling currency prevailing in the foreign exchange market or through a forward currency exchange contract ("Forward Contract") or other cash management position. A Forward Contract is an agreement to purchase or sell a specified currency at a specified future date (or within a specified time period) at a price set at the time of the contract. Forward Contracts are usually entered into with banks and broker/dealers, are not exchange traded and are usually for less than one year.

Currency exchange transactions may involve currencies of the different countries in which the Fund may invest, and may serve as hedges against possible variations in the exchange rates between these currencies and the U.S. dollar. The Fund's currency transactions may include transaction hedging and portfolio hedging involving either specific transactions or portfolio positions. Transaction hedging is the purchase or sale of a Forward Contract (or other cash management position) with respect to specific payables or receivables of the Fund in connection with the purchase or sale of portfolio securities. Portfolio hedging is the use of a Forward Contract (or other cash management position) with respect to one or more portfolio security position denominated or quoted in a particular currency. The Fund may engage in portfolio hedging with respect to the currency of a particular country in amounts approximating actual or anticipated positions in securities denominated in that currency. In addition to hedging transactions, the Fund's currency transactions may include those intended to profit from anticipated currency exchange fluctuations, even if not related to any particular Fund transaction or portfolio position, which can result in losses if such fluctuations do not occur as anticipated.

If the Fund enters into a Forward Contract, the custodian bank will, to the extent required (i.e., to the extent that the Forward Contract is not otherwise covered), segregate liquid assets of the Fund having a value equal to the Fund's commitment under such Forward Contract. At the maturity of a Forward Contract to deliver a particular currency, the Fund may either sell the portfolio security related to such contract and make delivery of the currency, or it may retain the security and either acquire the currency on the spot market or terminate its contractual obligation to deliver the currency by purchasing an offsetting contract with the same currency trader obligating it to purchase on the same maturity date the same amount of the currency.

It is impossible to forecast with absolute precision the market value of portfolio securities at the expiration of a Forward Contract. Accordingly, it may be necessary for the Fund to purchase additional currency on the spot market (and bear the expense of such purchase) if the market value of the security is less than the amount of currency the Fund is obligated to deliver, and if a decision is made to sell the security and make delivery of the currency. Conversely, it may be necessary to sell on the spot market some of the currency received upon the sale of the portfolio security if its market value exceeds the amount of currency the Fund is obligated to deliver.

If the Fund retains the portfolio security and engages in an offsetting transaction, the Fund will incur a gain or a loss to the extent that there has been movement in Forward Contract prices. If the Fund engages in an offsetting transaction, it may subsequently enter into a new Forward Contract to sell the currency. Should forward prices decline during the period between the date the Fund enters into a Forward Contract for the sale of a currency and the date it enters into an offsetting contract for the purchase of the currency, the Fund will realize a gain to the extent the price of the currency it has agreed to sell exceeds the price of the currency it has agreed to purchase. Should forward prices increase, the Fund will suffer a loss to the extent the price of the currency it has agreed to purchase exceeds the price of the currency it has agreed to sell. A default on the contract would deprive the Fund of unrealized profits or force the Fund to cover its commitments for purchase or sale of currency, if any, at the current market price.

Hedging against a decline in the value of a currency does not eliminate fluctuations in the prices of portfolio securities or prevent losses if the prices of such securities decline. Such transactions also preclude the opportunity for gain if the value of the hedged currency should rise. Moreover, it may not be possible for the Fund to hedge against a devaluation that is so generally anticipated that the Fund is not able to contract to sell the currency at a price above the devaluation level it anticipates. The cost to the Fund of engaging in currency exchange transactions varies with such factors as the currency involved, the length of the contract period and prevailing market conditions. Since currency exchange transactions are usually conducted on a principal basis, no fees or commissions are involved.

Lower-Rated Debt Securities. The Fund may invest in debt securities, including lower-rated securities (i.e., securities rated BB or lower by Standard & Poor's Corporation ("S&P") or Ba or lower by Moody's Investors Service, Inc. ("Moody's"), commonly called "junk bonds") and securities that are not rated. There are no restrictions as to the ratings of debt securities acquired by the Fund or the portion of the Fund's assets that may be invested in debt securities in a particular rating category, except that the Fund will not invest more than 20% of its assets in securities rated below investment grade or unrated securities considered by the investment adviser to be of comparable credit quality.

Securities rated BBB by S&P or Baa by Moody's (the lowest investment grade ratings) are considered to be of medium grade and to have speculative characteristics. Debt securities rated below investment grade are predominantly speculative with respect to the issuer's capacity to pay interest and repay principal. Although lower-rated debt and comparable unrated debt securities may offer higher yields than do higher-rated securities, they generally involve greater volatility of price and risk of principal and income, including the possibility of default by, or bankruptcy of, the issuers of the securities. In addition, the markets in which lower-rated and unrated debt securities are traded are more limited than those in which higher-rated securities are traded. Adverse publicity and investors' perceptions, whether or not based on fundamental analysis, may decrease the values and liquidity of lower-rated debt securities, especially in a thinly traded market. During periods of thin trading in these markets, the spread between bid and asked prices is likely to increase significantly, and the Fund may have greater difficulty selling its portfolio securities. See "Computation of Net Asset Value." Analyses of the creditworthiness of issuers of lower-rated debt securities may be more complex than for issuers of higher rated securities, and the ability of the Fund to achieve its investment objective may, to the extent of investment in lower-rated debt securities, be more dependent upon such creditworthiness analyses than would be the case if the Fund were investing in higher rated securities.

Lower-rated debt securities may be more susceptible to real or perceived adverse economic and competitive industry conditions than investment grade securities. The prices of lower-rated debt securities have been found to be less sensitive to interest rate changes than higher rated investments, but more sensitive to adverse economic downturns or individual corporate developments. A projection of an economic downturn or of a period of rising interest rates, for example, could cause a decline in lower-rated debt securities' prices because the advent of a recession could lessen the ability of a highly leveraged company to make principal and interest payments on its debt securities. If the issuer of lower-rated debt securities defaults, the Fund may incur additional expenses seeking recovery.

A more complete description of the characteristics of bonds in each rating category is included in the appendix to this Statement of Additional Information.

Investments in Other Investment Companies. The Fund may invest in other registered investment companies, either U.S. or foreign. For example, certain markets are closed in whole or in part to equity investments by foreigners and may be available for investment solely or primarily through such an investment company. The Fund generally may invest up to 10% of its total assets in shares of other investment companies and up to 5% of its total assets in any one investment company (in each case measured at the time of investment), as long as no investment represents more than 3% of the outstanding voting stock of the acquired investment company at the time of investment. These restrictions do not apply to certain investment companies known as private investment companies and "qualified purchaser" investment companies.

Investment in another investment company may involve the payment of a premium above the value of the issuer's portfolio securities, and is subject to market availability. In the case of a purchase of shares of such a company in a public offering, the purchase price may include an underwriting spread. The Fund does not intend to invest in such an investment company unless, in the judgment of the Adviser, the potential benefits of such investment justify the payment of any applicable premium or sales charge. As a shareholder in an investment company, the Fund would bear its ratable share of that investment company's expenses, including its advisory and administration fees. At the same time, the Fund would continue to pay its own management fees and other expenses.

"When-Issued" or "Delayed Delivery" Securities. The Fund may purchase securities on a "when-issued" or "delayed delivery" basis. When-issued or delayed delivery securities are securities purchased for future delivery at a stated price and yield. The Fund will generally not pay for such securities or start earning interest on them until they are received. Securities purchased on a when-issued or delayed delivery basis are recorded as assets and are marked-to-market daily. Although the payment and interest terms of these securities are established at the time the Fund enters into the commitment, the securities may be delivered and paid for a month or more after the date of purchase, when their value may have changed. The Fund will not invest more than 25% of its total assets in when-issued or delayed delivery securities, does not intend to purchase such securities for speculative purposes and will make commitments to purchase securities on a when-issued or delayed delivery basis with the intention of actually acquiring the securities. However, the Fund reserves the right to sell acquired when-issued or delayed delivery securities before their settlement dates if deemed advisable. At the time the Fund enters into a binding obligation to purchase securities on a when-issued basis, to the extent required, liquid assets of the Fund having a value at least as great as the purchase price of the securities to be purchased will be segregated on the books of the Fund and held by the Fund's custodian throughout the period of the obligation. The use of these investment strategies, as well as any borrowing by the Fund, may increase net asset value fluctuation.

Exchange Traded Funds ("ETFs"). The Fund may invest in ETFs, which are investment companies or special purpose trusts whose primary objective is to achieve the same rate of return as a particular market index or commodity while trading throughout the day on an exchange. Most ETF shares are sold initially in the primary market in units of 50,000 or more ("creation units"). A creation unit represents a bundle of securities (or other assets) that replicates, or is a representative sample of, the ETF's holdings and that is deposited with the ETF. Once owned, the individual shares comprising each creation unit are traded on an exchange in secondary market transactions for cash. The secondary market for ETF shares allows them to be readily converted into cash, like commonly traded stocks. The combination of primary and secondary markets permits ETF shares to be traded throughout the day close to the value of the ETF's underlying holdings. The Fund would purchase and sell individual shares of ETF's in the secondary market. These secondary market transactions require the payment of commissions.

ETF shares are subject to the same risks as other investment companies, as described above. Furthermore, there may be times when the exchange halts trading, in which case the Fund would be unable to sell ETF shares until trading is resumed. In addition, because ETF's often invest in a portfolio of common stocks and "track" a designated index, an overall decline in stocks comprising an ETF's benchmark index could have a greater impact on the ETF and investors than might be the case in an investment company with a more widely diversified portfolio. Losses could also occur if the ETF is unable to replicate the performance of the chosen benchmark index. ETFs tracking the return of a particular commodity (i.e. gold or oil) are of course exposed to the volatility and other financial risks relating to commodities investments.

Other risks associated with ETFs include the possibility that: (i) an ETF's distributions may decline if the issuers of the ETF's portfolio securities fail to continue to pay dividends; and (ii) under certain circumstances, an ETF could be terminated. Should termination occur, the ETF could have to liquidate its portfolio when the prices for those assets are falling. In addition, inadequate or irregularly provided information about an ETF or its investments, because ETFs are passively managed, could expose investors in ETFs to unknown risks.

Bank Obligations. The Fund may invest in bank obligations, which may include bank certificates of deposit, time deposits or bankers' acceptances. Certificates of deposit and time deposits are negotiable certificates issued against funds deposited in a commercial bank for a definite period of time and earning a specified return. Bankers' acceptances are negotiable drafts or bills of exchange, normally drawn by an importer or exporter to pay for specific merchandise, which are "accepted" by a bank, meaning in effect that the bank unconditionally agrees to pay the face value of the instrument on maturity.

Repurchase Agreements. The Fund may purchase securities and concurrently enter into "repurchase agreements." A repurchase agreement typically involves a purchase of an investment contract from a selling financial institution such as a bank or broker-dealer, which contract is fully secured by government obligations or other debt securities. The agreement provides that the purchaser will sell the underlying securities back to the institution at a specified price and at a fixed time in the future, usually not more than seven days from the date of purchase. The difference between the purchase price and the resale price represents the interest earned by the purchase, which is unrelated to the coupon rate or maturity of the purchased security. In the event of the bankruptcy or insolvency of the financial institution, the purchaser may be delayed in selling the collateral underlying the repurchase agreement. Further, the law is unsettled regarding the rights of the purchaser if the financial institution which is a party to the repurchase agreement petitions for bankruptcy or otherwise becomes subject to the U.S. Bankruptcy Code. Repurchase agreements of greater than seven days maturity may be deemed to be illiquid.

Making Loans. The Fund may purchase or sell loans or other direct debt instruments, including loan participations. Investing directly in loans or other direct debt instruments exposes the Fund to various risks similar to those borne by a creditor. Such risks include the risk of default, the risk of delayed repayment, and the risk of inadequate collateral. Investments in loans are also less liquid than investment in publicly traded securities and carry less legal protections in the event of fraud or misrepresentation. Unlike debt instruments that are securities, investments in loans are not regulated by federal securities laws or the SEC. In addition, loan participations involve a risk of insolvency by the lending bank or other financial intermediary.

Arbitrage Transactions. The Fund also may engage in arbitrage transactions involving near contemporaneous purchase of securities on one market and sale of those securities on another market to take advantage of pricing differences between markets. The Fund will incur a gain to the extent that proceeds exceed costs and a loss to the extent that costs exceed proceeds. The risk of an arbitrage transaction, therefore, is that the Fund may not be able to sell securities subject

to an arbitrage at prices exceeding the costs of purchasing those securities. The Fund will attempt to limit that risk by effecting arbitrage transactions only when the prices of the securities are confirmed in advance of the trade.

Structured Notes. The Fund may invest in structured notes and/or preferred stock, the value of which is linked to currencies, interest rates, other commodities, indices or other financial indicators. Structured securities differ from other types of securities in which the Fund may invest in several respects. For example, the coupon dividend and/or redemption amount at maturity may be increased or decreased depending on changes in the value of the underlying instrument.

Investment in structured securities involves certain risks. In addition to the credit risk of the security's issuer and the normal risks of price changes in response to changes in interest rates, the redemption amount may decrease as a result of changes in the price of the underlying instrument. Further, in the case of certain structured securities, the coupon and/or dividend may be reduced to zero, and any further declines in the value of the underlying instrument may then reduce the redemption amount payable on maturity. Finally, structured securities may be more volatile than the price of the underlying instrument. (See "Tax Status")

Restricted and Illiquid Securities. The Fund may invest up to 15% of its net assets in illiquid securities. Some but generally not all securities that are subject to legal or contractual restrictions on resale ("restricted securities") may be illiquid securities.

Generally, restricted securities may be sold only in privately negotiated transactions or in a public offering with respect to which a registration statement is in effect under the Securities Act of 1933 (the "1933 Act"). Where registration is required, the Fund may be obligated to pay all or part of the registration expenses and a considerable period may elapse between the time of the decision to sell and the time the Fund may be permitted to sell a security under an effective registration statement. If, during such a period, adverse market conditions were to develop, the Fund might obtain a less favorable price than that which prevailed when it decided to sell. Restricted securities will be priced at fair value as determined in good faith by the Board of Trustees. If, through the appreciation of illiquid securities or the depreciation of liquid securities, the Fund should be in a position where more than 15% of the value of its net assets is invested in illiquid assets, including restricted securities that are illiquid, the Fund will take appropriate steps to protect liquidity.

Notwithstanding the above, the Fund may purchase securities that have been privately placed but that are eligible for purchase and sale under Rule 144A under the 1933 Act. That rule permits certain qualified institutional buyers, such as the Fund, to trade in privately placed securities that have not been registered for sale under the 1933 Act. The Adviser, under the supervision of the Board of Directors of the Fund, will consider whether securities purchased under Rule 144A are illiquid and thus subject to the Fund's restriction on investing in illiquid securities. A determination as to whether a Rule 144A security is liquid or not is a question of fact. In making this determination, the Adviser will consider the trading markets for the specific security, taking into account the unregistered nature of a Rule 144A security. In addition, the Adviser could consider (1) the frequency of trades and quotes, (2) the number of dealers and potential purchasers, (3) the dealer undertakings to make a market, and (4) the nature of the security and of market place trades (e.g., the time needed to dispose of the security, the method of soliciting offers and the mechanics of transfer). The liquidity of Rule 144A securities would be monitored and if, as a result of changed conditions, it is determined that a Rule 144A security is no longer liquid, the Fund's holdings of illiquid securities would be reviewed to determine what steps, if any, are required to assure that the Fund does not invest more than the maximum percentage of its assets in illiquid securities. Investing in Rule 144A securities could have the effect of increasing the amount of the Fund's assets invested in illiquid securities if qualified institutional buyers are unwilling to purchase such securities. Because the liquidity or illiquidity of a security depends on various factors, other types of restricted securities also may be determined to be liquid under largely the same type of analysis and process as is applied in respect of Rule 144A.

Private Investment Funds. The Fund may invest to a limited extent in private investment funds. Such funds are not registered under the Investment Company Act and are therefore not subject to the extensive regulatory requirements it imposes. Private investment funds typically do not disclose the contents of their portfolios, which may make it difficult for the Fund to independently verify the value of an investment in a private investment fund. In addition, the Fund typically will not be able to withdraw an investment in a private investment fund except at certain designated times, presenting the risk that the Fund would not be able to withdraw from a private investment fund as soon as desired, especially during periods of volatility in markets in which such a private investment fund invests. Investments in private investment funds generally will be subject to the Fund's limitations on investments in "illiquid securities," as described immediately above.

Derivative Transactions. The Fund may invest in options, futures and swaps and related products which are often referred to as "derivatives." Derivatives may have a return that is tied to a formula based upon an interest rate, index

or other measurement which may differ from the return of a simple security of the same maturity. A formula may have a cap or other limitation on the rate of interest to be paid. Derivatives may have varying degrees of volatility at different times, or under different market conditions.

The Fund may enter into interest rate, currency and index swaps and the purchase or sale of related caps, floors and collars. The Fund may enter into these transactions to preserve a return or spread on a particular investment or portion of its portfolio, to protect against currency fluctuations or to protect against any increase in the price of securities it anticipates purchasing at a later date. Interest rate swaps involve the exchange by the Fund with another party of their respective commitments to pay or receive interest, such as an exchange of floating rate payments for fixed rate payments with respect to a notional amount of principal. A currency swap is an agreement to exchange cash flows on a notional amount of two or more currencies based on the relative value differential between them and an index swap is an agreement to swap cash flows on a notional amount based on changes in values of the reference indices. Swaps may be used in conjunction with other derivative instruments to offset interest rate, currency or other underlying risks. For example, interest rate swaps may be offset with "caps," "floors" or "collars." A "cap" is essentially a call option which places a limit on the amount of floating rate interest that must be paid on a certain principal amount. A "floor" is essentially a put option which places a limit on the minimum amount that would be paid on a certain principal amount. A "collar" is essentially a combination of a long cap and a short floor where the limits are set at different levels.

The Fund will usually enter into swaps on a net basis; that is, the two payment streams will be netted out in a cash settlement on the payment date or dates specified in the instrument, with the Fund receiving or paying, as the case may be, only the net amount of the two payments. To the extent obligations created thereby may be deemed to constitute senior securities under the Investment Company Act, the Fund will maintain required collateral in a segregated account consisting of liquid assets. The segregation of these assets will have the effect of limiting the investment adviser's ability otherwise to invest those assets.

Special Risks of Over-the-Counter Derivative Transactions. Over-the-Counter ("OTC") derivative transactions differ from exchange-traded derivative transactions in several respects. OTC derivatives are transacted directly with dealers and not with a clearing corporation. Without the availability of a clearing corporation, OTC derivative pricing is normally done by reference to information from market makers, which information is carefully monitored by the Adviser and verified in appropriate cases.

As OTC derivatives are transacted directly with dealers, there is a risk of nonperformance by the dealer as a result of the insolvency of such dealer or otherwise. An OTC derivative may only be terminated voluntarily by entering into a closing transaction with the dealer with whom the Fund originally dealt. Any such cancellation may require the Fund to pay a premium to that dealer. In those cases in which the Fund has entered into a covered derivative transaction and cannot voluntarily terminate the derivative, the Fund will not be able to sell the underlying security until the derivative expires or is exercised or different cover is substituted. The Fund intends to enter into OTC derivative transactions only with dealers which agree to, and which are expected to be capable of, entering into derivative closing transactions with the Fund. There is also no assurance that the Fund will be able to liquidate an OTC derivative at any time prior to expiration.

Options Transactions. The Adviser believes that certain transactions in options on securities and on stock indices may be useful in limiting the Fund's investment risk and augmenting its investment return. The Adviser expects, however, the amount of the Fund's assets that will be involved in options transactions to be small relative to the Fund's total assets. Accordingly, it is expected that only a relatively small portion of the Fund's investment return will be attributable to transactions in options on securities and on stock indices. The Fund may invest in options transactions involving options on securities and on stock indices that are traded on U.S. and foreign exchanges or in the over-the-counter markets.

A call option is a contract pursuant to which the purchaser, in return for a premium paid, has the right to buy the equity or debt security underlying the option at a specified exercise price at any time during the term of the option. With respect to a call option on a stock index, the purchaser is entitled to receive cash if the underlying stock index rises sufficiently above its level at the time the option was purchased. The writer of the call option, who receives the premium, has the obligation, upon exercise of the option, to deliver the underlying equity or debt security against payment of the exercise price. With respect to a call option on a stock index, the writer has the obligation to deliver cash if the underlying index rises sufficiently above its level when the option was purchased.

A put option gives the purchaser, in return for a premium, the right to sell the underlying equity or debt security at a specified exercise price during the term of the option. With respect to a put option on a stock index, the purchaser is entitled to receive cash if the underlying index falls sufficiently below its level at the time the option was purchased.

The writer of the put, who receives the premium, has the obligation to buy the underlying equity or debt security upon exercise at the exercise price. With respect to a put option on a stock index, the writer has the obligation to deliver cash if the underlying index falls sufficiently below its level when the option was purchased. The price of an option will reflect, among other things, the relationship of the exercise price to the market price of the underlying financial instrument or index, the price volatility of the underlying financial instrument or index, the remaining term of the option, supply and demand of such options and interest rates.

One purpose of purchasing call options is to hedge against an increase in the price of securities that the Fund ultimately intends to buy. Hedge protection is provided during the life of the call because a Fund, as the holder of the call, is able to buy the underlying security at the exercise price, and, in the case of a call on a stock index, is entitled to receive cash if the underlying index rises sufficiently. However, if the value of a security underlying a call option or the general market or a market sector does not rise sufficiently when a Fund has purchased a call option on the underlying instrument, that option may result in a loss.

Securities and options exchanges have established limitations on the maximum number of options that an investor or group of investors acting in concert may write. It is possible that the Fund, other mutual funds advised by the Adviser and other clients of the Adviser may be considered such a group. Position limits may restrict the Fund's ability to purchase or sell options on particular securities and on stock indices.

Covered Option Writing. The Fund may write "covered" call options on equity or debt securities and on stock indices in seeking to enhance investment return or to hedge against declines in the prices of portfolio securities or may write put options to hedge against increases in the prices of securities which it intends to purchase. A call option is covered if the Fund holds, on a share-for-share basis, either the underlying shares or a call on or similar right to acquire the same security as the call written where the exercise price of the call held is equal to or less than the exercise price of the call written (or greater than the exercise price of the call written if the difference is maintained by the Fund in cash, Treasury bills or other high grade short-term obligations in a segregated account with its custodian). A put option is "covered" if the Fund maintains cash, Treasury bills or other high grade short-term obligations with a value equal to the exercise price in a segregated account with its custodian, or holds on a share-for-share basis a put on the same equity or debt security as the put written where the exercise price of the put held is equal to or greater than the exercise price of the put written, or lower than the exercise price of the put written if the difference is maintained in a segregated account with its custodian. One reason for writing options is to attempt to realize, through the receipt of premiums, a greater return than would be realized on the securities alone. In the case of a securities call, the writer receives the premium, but has given up the opportunity for profit from a price increase in the underlying security above the exercise price during the option period. In the case of a stock index call, the writer receives the premium, but is obligated to deliver cash if the underlying index rises sufficiently during the option period. Conversely, the put option writer has, in the form of the premium, gained a profit as long as the price of the underlying security or stock index remains above the exercise price, but has assumed an obligation to purchase the underlying security at the exercise price from or deliver cash to the buyer of the put option during the option period. Other "coverage" arrangements also may be used as permitted by applicable law.

Another reason for writing options is to hedge against a moderate decline in the value of securities owned by the Fund in the case of a call option, or a moderate increase in the value of securities the Fund intends to purchase in the case of a put option. If a covered option written by the Fund expires unexercised, it will realize income equal to the amount of the premium it received for the option. If an increase occurs in the underlying security or stock index sufficient to result in the exercise of a call written by the Fund, it may be required to deliver securities or cash and may thereby forego some or all of the gain that otherwise may have been realized on the securities underlying the call option. This "opportunity cost" may be partially or wholly offset by the premium received for the covered call written by the Fund.

Options on Stock Indices. The Fund may write "covered" call options on broadly based stock market indices. When the Fund writes a call option on a stock market index, it will segregate or put into escrow with its custodian any combination of cash, cash equivalents or "qualified securities" with a market value at the time the option is written of not less than 100% of the current index value times the multiplier times the number of contracts. A "qualified security" is an equity security which is listed on a securities exchange or on the NASDAQ against which the Fund has not written a call option and which has not been hedged by the sale of stock index futures. Other "coverage" arrangements also may be used as permitted by applicable law.

Index prices may be distorted if trading in certain stocks included in the index is interrupted. Trading in the index options also may be interrupted in certain circumstances, such as if trading were halted in a substantial number of stocks

included in the index. If this occurred, the Fund would not be able to close out options which it had purchased or written and, if restrictions on exercise were imposed, might be unable to exercise an option it held, which could result in substantial losses to the Fund.

If a Fund were assigned an exercise notice on a call it has written, it would be required to liquidate portfolio securities in order to satisfy the exercise, unless it has other liquid assets that are sufficient to satisfy the exercise of the call. When the Fund has written a call, there is also a risk that the market may decline between the time the Fund has a call exercised against it, at a price which is fixed as of the closing level of the index on the date of exercise, and the time it is able to sell securities in its portfolio. As with stock options, the Fund will not learn that an index option has been exercised until the day following the exercise date but, unlike a call on stock where it would be able to deliver the underlying securities in settlement, the Fund may have to sell part of its securities portfolio in order to make settlement in cash, and the price of such securities might decline before they can be sold. For example, even if an index call which the Fund has written is "covered" by an index call held by the Fund with the same strike price, it will bear the risk that the level of the index may decline between the close of trading on the date the exercise notice is filed with the Options Clearing Corporation and the close of trading on the date the Fund exercises the call it holds or the time it sells the call, which in either case would occur no earlier than the day following the day the exercise notice was filed.

Futures and Options on Futures. The Fund may utilize futures contracts and options on futures. These transactions may be effected on securities exchanges or in the over-the-counter market. When purchased over-the-counter, the Fund bears the risk that the counterparty to the contract will be unable or unwilling to perform its obligations. These contracts may also be illiquid and, in such cases, the Fund may have difficulty closing out its position. Engaging in these types of transactions is a speculative activity and involves risk of loss. In addition, engaging in these types of transactions may increase the volatility of returns, because they commonly involve significant "built in" leverage and can be entered into with relatively small "margin" commitments relative to the resulting investment exposure. Futures contracts and similar "derivative" instruments are also subject to the risk of default by the counterparties to the contracts.

The Fund may enter into futures contracts in U.S. markets or on exchanges located outside the United States. Foreign markets may offer advantages such as trading opportunities or arbitrage possibilities not available in the United States. Foreign markets, however, may have greater risk potential than U.S. markets. For example, some foreign exchanges are principal markets so that no common clearing facility exists and an investor may look only to the broker for performance of the contract. In addition, any profits realized could be eliminated by adverse changes in the exchange rate. Transactions on foreign exchanges may include both commodities that are traded on U.S. exchanges and those that are not. Unlike trading on U.S. commodity exchanges, trading on foreign commodity exchanges is not regulated by the Commodity Futures Trading Commission ("CFTC").

Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified periods during the trading day. Futures contract prices could move to the limit for several consecutive trading days with little or no trading, preventing prompt liquidation of futures positions and potentially subjecting the Fund to substantial losses. Successful use of futures also is subject to the investment adviser's ability to predict correctly movements in the direction of the relevant market, and, to the extent the transaction is entered into for hedging purposes, to determine the appropriate correlation between the transaction being hedged and the price movements of the futures contract.

Positions of the SEC and its staff may require the Fund to segregate liquid assets in connection with its options and futures transactions in an amount generally equal to the value of the underlying option or commodity. The segregation of these assets will have the effect of limiting the investment adviser's ability otherwise to invest those assets. Futures and related options transactions must constitute permissible transactions pursuant to regulations promulgated by the CFTC. As a general matter, the investment adviser intends to conduct the operations of the Fund in compliance with CFTC Rule 4.5 under the Commodity Exchange Act of 1974, as amended, in order to avoid regulation by the CFTC as a commodity pool operator with respect to the Fund.

Commodities and Commodity Contracts. The Fund may purchase or sell such precious metals as gold or silver directly or may invest in precious metal commodity contracts and options on such contracts (metals are considered "commodities" under the federal commodities laws). Investing in precious metals in this manner carries risks, as described below under "Risks of Investing in Gold." The Fund also may invest in instruments related to precious metals, including structured notes, securities of precious metal finance and operating companies.

Fluctuations in the Price of Gold. The price of gold has been subject to substantial upward and downward price movements over short periods of time and may be affected by unpredictable international monetary and political policies, such as currency devaluations or revaluations, economic conditions within an individual country, trade imbalances or trade or currency restrictions between countries and world inflation rates and interest rates. The price of gold, in turn, is likely to affect the market prices of securities of companies mining, processing or dealing in gold, and, accordingly, the value of the Fund's investments in such securities also may be affected.

Other Risks of Investing in Gold. In addition to investing in precious metal finance and operating companies, the Fund may also invest directly in precious metals (such as gold bullion) or purchase or sell contracts for their future delivery ("futures contracts," the risks of which are described above under "Futures and Options on Futures"). The risks related to investing in precious metals directly are similar to those of investing in precious metal finance and operating companies, as described in the Fund's Prospectus. There are, however, additional considerations related to such direct precious metal investments, including custody and transaction costs that may be higher than those involving securities. Moreover, holding gold, whether in physical form or book account, results in no income being derived from such holding, unlike securities which may pay dividends or make other current payments. In addition, income derived from trading in gold and certain contracts and derivatives relating to gold must be closely monitored to avoid potentially negative tax consequences. Although the Fund has contractual protections with respect to the credit risk of its custodian, gold held in physical form (even in a segregated account) involves the risk of delay in obtaining the assets in the case of bankruptcy or insolvency of the custodian. This could impair disposition of the assets under those circumstances. Finally, although not currently anticipated, if gold in the future were held in book account, it would involve risks of the credit of the party holding the gold.

Market Liquidity and Counterparty Credit Risks. While the Fund is subject to limitations on its holdings of illiquid securities (see "Restricted and Illiquid Securities" above), the Fund may experience periods of limited liquidity, or a complete lack of liquidity, of certain of its investments, which may cause the Fund to retain investments longer than anticipated or to dispose of assets at a value that is less than anticipated. The Summer of 2007 witnessed the beginning of a liquidity and credit crisis of historic proportions that had a domino effect on financial markets and participants worldwide that continued throughout 2008 and into 2009. Among other effects, the recent global financial and economic turmoil has led certain brokers and other lenders to be unwilling or less willing to finance new investments or to only offer financing for investments on less favorable terms than had been prevailing in the recent past. Although the U.S. Federal Reserve Bank, European Central Bank, and other countries' central banks have injected significant liquidity into markets and otherwise made significant funds, guarantees, and other accommodations available to certain financial institutions, elevated levels of market stress and volatility and impaired liquidity, funding, and credit persist.

While instruments correlated to the residential mortgage market were affected first, ultimately market participants holding a broad range of securities, other financial instruments and commodities and commodities contracts were forced to liquidate investments, often at deeply discounted prices, in order to satisfy margin calls (i.e., repay debt), shore up their cash reserves, or for other reasons. Market shifts of this nature may cause unexpectedly rapid losses in the value of the Fund's positions. It is uncertain how long this current liquidity and credit crisis will continue, what other effects it will have on financial markets and the Fund's operations, and what may be the overall impact of future liquidity and credit crises.

Credit risk includes the risk that a counterparty or an issuer of securities or other financial instruments will be unable to meet its contractual obligations and fail to deliver, pay for, or otherwise perform a transaction. Credit risk is incurred when the Fund engages in principal-to-principal transactions outside of regulated exchanges, as well as in transactions on certain exchanges that operate without a clearinghouse or similar credit risk-shifting structure. Recently, several prominent financial market participants have failed or nearly failed to perform their contractual obligations when due – creating a period of great uncertainty in the financial markets, government intervention in certain markets and in certain failing institutions, severe credit and liquidity contractions, early terminations of transactions and related arrangements, and suspended and failed payments and deliveries.

Substantial Ownership Positions. The Fund may accumulate substantial positions in the securities or even gain control of individual companies. At times, the Fund also may seek the right to designate one or more persons to serve on the boards of directors of companies in which they invest. The designation of directors and any other exercise of management or control could expose the assets of the Fund to claims by the underlying company, its security holders and its creditors. Under these circumstances, the Fund might be named as a defendant in a lawsuit or regulatory action. The outcome of such disputes, which may affect the value of the Fund's positions, may be difficult to anticipate and the possibility of successful claims against the Fund that would require the payout of Fund assets to the claimant(s) cannot be precluded.

Change of Objective

The investment objective of the Fund is not a fundamental policy and, accordingly, may be changed by the Board of Trustees without shareholder approval. Shareholders will be notified a minimum of 60 days in advance of any change in investment objective.

Investment Restrictions

In pursuing its investment objective, the Fund will not:

1. With respect to 75% of the value of the Fund's total assets, invest more than 5% of its total assets (valued at time of investment) in securities of any one issuer, except securities issued or guaranteed by the government of the United States, or any of its agencies or instrumentalities, or acquire securities of any one issuer which, at the time of investment, represent more than 10% of the voting securities of the issuer;

2. Borrow money except that in exceptional circumstances the Fund may borrow from banks for temporary purposes, provided that such borrowings shall be unsecured and may not exceed 10% of the Fund's net assets at the time of the borrowing (including the amount borrowed). The Fund will not purchase securities while borrowings exceed 5% of its total assets;

3. Invest more than 25% of its total assets (valued at time of investment) in securities of companies in any one industry other than U.S. Government Securities;

4. Make direct loans, but this restriction shall not prevent the Fund from (a) buying a part of an issue of bonds, debentures, or other obligations that are publicly distributed, or from investing up to an aggregate of 15% of its total assets (taken at market value at the time of each purchase) in parts of issues of bonds, debentures or other obligations of a type privately placed with financial institutions, (b) buying loans (or portions of them), or other direct debt instruments including loan participations, originated by another party or parties with respect to corporate borrowers, or (c) lending portfolio securities, provided that the Fund may not lend securities if, as a result, the aggregate value of all securities loaned would exceed 33% of its total assets (taken at market value at the time of such loan);*

5. Underwrite the distribution of securities of other issuers; however, the Fund may acquire "restricted" securities which, in the event of a resale, might be required to be registered under the 1933 Act on the grounds that the Fund could be regarded as an underwriter as defined by the 1933 Act with respect to such resale;

6. Purchase or sell commodities or commodity contracts, except that it may enter into forward contracts and may sell commodities received by it as distributions on portfolio investments (however, the Fund may purchase or sell precious metals directly and purchase or sell precious metal commodity contracts or options on such contracts in compliance with applicable commodities laws);

7. Purchase and sell real estate or interests in real estate, although it may invest in marketable securities of enterprises that invest in real estate or interests in real estate;

8. Make margin purchases of securities, except for the use of such short-term credits as are needed for clearance of transactions;

9. Sell securities short or maintain a short position, except short sales against-the-box.

Restrictions 1 through 9 above (except the portions in parentheses) are "fundamental," which means that they cannot be changed without the vote of a majority of the outstanding voting securities of the Fund (defined by the Investment Company Act as the lesser of (i) 67% of the Fund's shares present at a meeting if more than 50% of the shares outstanding are present or (ii) more than 50% of the Fund's outstanding shares). In addition, the Fund is subject to a number of restrictions that may be changed by the Board of Trustees without shareholder approval. Under those non-fundamental restrictions, the Fund will not:

a. Invest in oil, gas or other mineral leases or exploration or development programs, although it may invest in marketable securities of enterprises engaged in oil, gas or mineral exploration (for the avoidance of doubt, the Funds may also purchase ETFs that invest in or track the return of commodities);

* The Fund has no present intention of lending its portfolio securities.

b. Invest more than 10% of its net assets (valued at time of investment) in warrants, valued at the lower of cost or market; provided that warrants acquired in units or attached to securities shall be deemed to be without value for purposes of this restriction;

c. Pledge, mortgage or hypothecate its assets, except as may be necessary in connection with permitted borrowings or in connection with short sales; and

Notwithstanding the foregoing investment restrictions, the Fund may purchase securities pursuant to the exercise of subscription rights, provided that such purchase will not result in the Fund's ceasing to be a diversified investment company. Japanese and European corporations frequently issue additional capital stock by means of subscription rights offerings to existing shareholders at a price substantially below the market price of the shares. The failure to exercise such rights would result in the Fund's interest in the issuing company being diluted. The market for such rights is not well developed in all cases and, accordingly, the Fund may not always realize full value on the sale of rights. The exception applies in cases where the limits set forth in the investment restrictions would otherwise be exceeded by exercising rights or would have already been exceeded as a result of fluctuations in the market value of the Fund's portfolio securities with the result that the Fund would be forced either to sell securities at a time when it might not otherwise have done so, or to forego exercising the rights.

Performance

Total Return. From time to time the Fund will advertise its average annual total return. Quotations of average annual returns for the Fund will be expressed in terms of the average annual compounded rates of return of a hypothetical investment in the Fund over periods of 1, 5 and 10 years (up to the life of the Fund), calculated pursuant to the following formula: P(1+T)(n) = ERV (where P = a hypothetical initial payment of $1000, T = the average annual return, n = the number of years, and ERV = the ending redeemable value of a hypothetical $1000 payment made at the beginning of the period). This calculation assumes deduction of a proportional share of Fund expenses on an annual basis and assumes reinvestment of all income dividends and capital gains distributions during the period. During the one year period ended December 31, 2008, the Fund's average annual rate of return was (18.82)%. Under the same assumptions, during the ten year period ended December 31, 2008 an investment in the Fund would have increased at an average annual compounded rate of return of 17.12%.

Comparison of Portfolio Performance. From time to time, the Trust may discuss in sales literature and advertisements, specific performance grades or rankings or other information as published by recognized mutual fund statistical services, such as Morningstar, Inc. or Lipper Analytical Services, Inc., or by publications of general interest such as Barron's, Business Week, Financial World, Forbes, Fortune, Kiplinger's Personal Finance, Money, Morningstar Mutual Funds, Smart Money, The Wall Street Journal or Worth. Total return information for the Fund will not be advertised or included in sales literature unless accompanied by comparable performance information for a separate account to which the Fund offers its shares. Quotations of total return for the Fund will not take into account charges and deductions against any separate accounts to which the Fund shares are sold or charges and deductions against the pertinent variable life insurance and variable annuity contracts ("Variable Contracts"). The Fund's total return should not be compared with mutual funds that sell their shares directly to the public since the figures provided do not reflect charges against the separate accounts or the Variable Contracts.

Portfolio Turnover. Although the Fund will not make a practice of short-term trading, purchases and sales of securities will be made whenever appropriate, in the investment adviser's view, to achieve the Fund's investment objective. The rate of portfolio turnover is calculated by dividing the lesser of the cost of purchases or the proceeds from sales of portfolio securities (excluding short-term U.S. government obligations and other short-term investments) for the particular fiscal year by the monthly average of the value of the portfolio securities (excluding short-term U.S. government obligations and short-term investments) owned by the Fund during the particular fiscal year. Although higher portfolio turnover rates are likely to result in higher brokerage commissions paid by the Fund, portfolio turnover is not a limiting factor when management deems portfolio changes appropriate to achieve the Fund's stated objective.

MANAGEMENT OF THE TRUST

The business of the Trust is managed by its Board of Trustees, which elects officers responsible for the day to day operations of the Fund and for the execution of the policies formulated by the Board of Trustees.

Pertinent information regarding the members of the Board of Trustees and principal officers of the Trust is set forth below. Some of the Trustees and officers are employees of the Adviser and its affiliates. At least a majority of the Trust's Board of Trustees are not "interested persons" as that term is defined in the Investment Company Act.

INDEPENDENT TRUSTEES(1)

Name, Date of
Birth and Address

Position(s)
Held with
the Trust

Term of
Office(2)
and Length
of Time
Served

Principal
Occupation(s)
During Past 5 Years

Number of
Portfolios
in the Fund
Complex
Overseen by
Trustee

Other
Directorships/
Trusteeships
Held by Trustee

Lisa Anderson
1345 Avenue of the
Americas
New York, New York 10105
(born October 1950)

Trustee

December
2005 to
present

Provost, American University in Cairo; James T. Shotwell Professor of International Relations and Dean, School of International and Public Affairs, Columbia University

Chair, Social Science Research Council; Member, Carnegie Council on Ethics and International Affairs; Member Emerita, Human Rights Watch; Trustee, First Eagle Funds (5 portfolios)

Candace K. Beinecke
One Battery Park Plaza New York, New York 10004
(born December 1946)

Trustee (Chair)

December 1999 to present

Chair, Hughes Hubbard & Reed LLP

Director, ALSTOM; Trustee, Vornado Realty Trust; Director, Rockefeller Financial Services, Inc. and Rockefeller & Co., Inc.; Trustee, The Wallace Foundation; Director, Vice Chair, and member of the Executive Committee, Partnership for New York City, Inc.; Board of Advisors, Yale Law School Center for the Study of Corporate Law; Trustee, First Eagle Funds (Chair)(5 portfolios)

⁽¹⁾ Trustees who are not "interested persons" of the Trust as defined in the Investment Company Act.

⁽²⁾ The term of office of each Independent Trustee expires on his/her 70th birthday.

Name, Date of
Birth and Address

Position(s)
Held with
the Trust

Term of
Office(2)
and Length
of Time
Served

Principal
Occupation(s)
During Past 5 Years

Number of
Portfolios
in the Fund
Complex
Overseen by
Trustee

Other
Directorships/
Trusteeships
Held by Trustee

Jean D. Hamilton
1345 Avenue of the Americas
New York, New York 10105
(born January 1947)

Trustee

March 2003 to present

Private Investor/ Independent Consultant/ Member, Brock Capital Group LLC; prior to November 2002, Chief Executive Officer, Prudential Institutional; Executive Vice President, Prudential Financial, Inc.

Director, RenaissanceRe Holdings Ltd; Director, Four Nations; Trustee, First Eagle Funds (5 portfolios)

James E. Jordan
1345 Avenue of the Americas
New York, New York 10105
(born April 1944)

Trustee

December 1999 to present

Private Investor and Independent Consultant; prior to July 2005, Managing Director, Arnhold and S. Bleichroeder Advisers, LLC and Director, ASB Securities LLC and ASB Advisers UK, Limited; prior to July 2002, private investor and consultant to The Jordan Company (private investment banking firm) since June 1997

Director, Leucadia National Corporation; Director, JZ Capital Partners, Plc. (Guernsey investment trust company); Dean's Advisory Council, Columbia University School of International and Public Affairs; Chairman's Council, Conservation International; Trustee, First Eagle Funds (5 portfolios)

William M. Kelly
500 Fifth Avenue,
50 th Floor
New York, New York 10110
(born February 1944)

Trustee

December 1999 to present

President, Lingold Associates

Treasurer and Trustee, Black Rock Forest Preservation and Consortium; Trustee, St. Anselm College; Trustee, New Hampshire Institute of Politics; Trustee, First Eagle Funds (5 portfolios)

Paul J. Lawler
One Michigan Avenue
East Battle Creek, Michigan 49017
(born May 1948)

Trustee

March 2002 to present

Vice President, Investments and Chief Investment Officer, W.K. Kellogg Foundation

Finance and Investment Committee Member, Battle Creek Community Foundation; Custody Advisory Committee Member, The Bank of New York; Advisory Committee, Common Fund Capital; Advisory Committee, TA Realty Advisors; Trustee, First Eagle Funds (5 portfolios)

⁽¹⁾ Trustees who are not "interested persons" of the Trust as defined in the Investment Company Act.

⁽²⁾ The term of office of each Independent Trustee expires on his/her 70th birthday.

INTERESTED TRUSTEES

Name, Date of
Birth and Address

Position(s)
Held with
the Trust

Term of
Office(1)
and Length
of Time
Served

Principal
Occupation(s)
During Past 5 Years

Number of
Portfolios
in the Fund
Complex
Overseen by
Trustee

Other
Directorships/
Trusteeships
Held by Trustee

John P. Arnhold(2)
1345 Avenue of the Americas
New York, New York 10105
(born December 1953)

President; Trustee

December 1999 to present

Co-President,
Co-CEO and Director, Arnhold and
S. Bleichroeder Holdings, Inc.; Chairman, CEO and Director, Arnhold and S. Bleichroeder Advisers, LLC and
ASB Securities LLC; prior to March 2005, President and Director, Natexis Bleichroeder, Inc. and Natexis Bleichroeder UK

Director, Arnhold Ceramics; Director, The Arnhold Foundation; Director, The Mulago Foundation; Director, Hanseatic Asset Management LBG; Director, Quantum Endowment Fund; Director, Educational Broadcasting Corporation; Trustee, Trinity Episcopal Schools Corp.; Trustee, Vassar College; Trustee, Sports and Arts in Schools Foundation; Trustee, Jazz at Lincoln Center; Managing Member, New Eagle Management Company, LLC; President and Trustee, First Eagle Funds (5 portfolios)

Jean-Marie Eveillard(2) . . 1345 Avenue of the Americas
New York, New York 10105
(born January 1940)

Trustee

June 2008 to present

Senior Advisor to Arnhold and S. Bleichroeder Advisers, LLC since March 2009; Senior Vice President, Arnhold and S. Bleichroeder Advisers, LLC since January 2000; Portfolio Manager of First Eagle Global Fund, First Eagle Overseas Fund, First Eagle U.S. Value Fund, First Eagle Gold Fund, and First Eagle Variable Funds March 2007 through March 2009 and prior to December 2004 (portfolio management responsibilities commenced 1979)

Director, SocGen International SICAV (Luxembourg); Trustee, The Frick Collection; Trustee, First Eagle Funds
(5 portfolios)

⁽¹⁾ The term of office of each Interested Trustee is indefinite.

⁽²⁾ Mr. Arnhold and Mr. Eveillard are Interested Trustees (i.e., each is an "interested person" of the Trust as defined in the Investment Company Act) because Mr. Arnhold is an officer and director of the Trust's investment adviser and principal underwriter, and Mr. Eveillard is an employee of the Trust's investment adviser.

OFFICERS

Name, Date of
Birth and Address

Position(s)
Held with
the Trust

Term of Office
and Length of
Time Served(1)

Principal Occupation(s)
During Past Five (5) Years

John P. Arnhold
1345 Avenue of the Americas
New York, New York 10105
(born December 1953)

President and Trustee

December 1999 to present

See table on preceding page related to Interested Trustees

Robert Bruno
1345 Avenue of the Americas
New York, New York 10105
(born June 1964)

Chief Operations Officer

December 1999 to present

Senior Vice President, Arnhold and S. Bleichroeder Advisers, LLC; President, ASB Securities LLC; Chief Operations Officer, First Eagle Funds

Joseph Malone
1345 Avenue of the Americas
New York, New York 10105
(born September 1967)

Chief Financial Officer

September 2008 to present

Senior Vice President, Arnhold and S. Bleichroeder Advisers, LLC; Chief Financial Officer, First Eagle Funds from September 2008; Chief Financial Officer and Treasurer, Aberdeen Funds from November 2007; Director, UBS Global Asset Management from October 2001; Global Fund Treasurer, UBS Global Asset Management from September 2006; Treasurer and Co-Head Mutual Fund Administration Group, UBS Global Asset Management from October 2001

Mark D. Goldstein
1345 Avenue of the Americas
New York, New York 10105
(born October 1964)

Chief Compliance Officer

February 2005 to present

General Counsel, Chief Compliance Officer, Senior Vice President and Secretary, Arnhold and S. Bleichroeder Advisers, LLC; General Counsel and Secretary of Arnhold and S. Bleichroeder Holdings, Inc., and Chief Compliance Officer, First Eagle Funds from February 2005; Chief Compliance Officer, Good Hope Advisers, LLC from January 2006; Senior Counsel and Chief Compliance Officer, MacKay Shields LLC from April 2004; Senior Associate General Counsel, UBS Financial Services, Inc. from May 1998

Suzan J. Afifi
1345 Avenue of the Americas
New York, New York 10105
(born October 1952)

Secretary and Vice President

December 1999 to present

Senior Vice President, Arnhold and S. Bleichroeder Advisers, LLC; Vice President, ASB Securities LLC; Secretary and Vice President, First Eagle Funds

Philip Santopadre
1345 Avenue of the Americas
New York, New York 10105
(born August 1977)

Treasurer

September 2005 to present

Vice President, Arnhold and S. Bleichroeder Advisers, LLC; Treasurer, First Eagle Funds

Michael Luzzatto
1345 Avenue of the Americas
New York, New York 10105
(born April 1977)

Vice President

December 2004 to present

Senior Vice President, Arnhold and S. Bleichroeder Advisers, LLC; Vice President, ASB Securities LLC; Vice President, First Eagle Funds

Winnie Chin
1345 Avenue of the Americas
New York, New York 10105
(born July 1974)

Assistant Treasurer

March 2001 to present

Vice President, Arnhold and S. Bleichroeder Advisers, LLC; Assistant Treasurer, First Eagle Funds

⁽¹⁾ The term of office of each officer is indefinite. Length of time served represents time served as an officer of the Trust (or its predecessor entities), although various positions may have been held during the period.

The following table describes the standing committees of the Board of Trustees of the Trust.

Committee Name

Members

Function(s)

Number of Committee
Meetings in the
Last Fiscal Year

Audit Committee

Jean D. Hamilton
William M. Kelly
Paul J. Lawler (Chair)

Reviews the contract between the Trust and its independent registered public accounting firm (in this regard, assists the Board in selecting the independent registered public accounting firm and is directly responsible for supervising that firm's compensation and performance), oversees the Trust's accounting and financial reporting policies, procedures and internal controls, and acts as liaison to the independent registered public accounting firm; reviews and, as appropriate, approves in advance non-audit services provided by the independent registered public accounting firm to the Trust, the Adviser, and, in certain cases, other affiliates of the Trust.

Nominating and
Governance
Committee

Lisa Anderson
Candace K. Beinecke (Chair) James E. Jordan

Nominates new Independent Trustees of the Trust. (The Nominating Committee does not consider shareholder recommendations.) Considers various matters relating to the governance and operations of the Board of Trustees, including committee structure and Trustee compensation.

Valuation Committee

John P. Arnhold
Jean D. Hamilton

Sets and recommends securities valuation policies, supervises the Adviser in the valuation of Fund assets, and, in certain instances, values Fund assets directly.

Compensation of Trustees and Officers. Effective November 1, 2008 those Trustees of the Trust who are not officers or employees of the Adviser or ASB Holdings are paid by the Trust and First Eagle Funds an annual fee of $96,000, a fee of $3,500 for each in-person meeting and $1,000 (subject to the discretion of the Chair) for each telephonic meeting of the Trust's Board of Trustees, and a fee of $2,500 for each meeting of any Committee of the Board that they attend (other than meetings of the Valuation Committee, for which the meeting fee is as described below). The Trustees also receive an annual fee of $25,000 for serving as the chair of any standing committee of Trustees (except that such additional fee is $35,000 in the case of the Audit Committee). In the case of the Valuation Committee, there is, as of January 1, 2009, a per meeting fee of $1,000 and no separate retainer for the chair of that committee. The Chair of the Board of Trustees receives an additional annual fee of $96,000 for serving in that position. Such fees are allocated, generally, between the Trust and First Eagle Funds on a pro rata basis in relationship to their relative net assets. Each Trustee is reimbursed by the Trust for any expenses he or she may incur by reason of attending such meetings or in connection with services he or she may perform for the Trust. During the fiscal year ended December 31, 2008, an aggregate of $10,519 was paid, accrued or owed for Trustees' fees and expenses by the Trust.

The following table sets forth information regarding compensation of Trustees by the Trust and by the fund complex of which the Trust is a part for the fiscal year ended December 31, 2008. Officers of the Trust and Interested Trustees do not receive any compensation from the Trust or any other fund in the fund complex which is a U.S. registered investment company. The Trust does not maintain a retirement plan for its Trustees.

Trustee Compensation Table
Fiscal Year Ended December 31, 2008

Name of Person, Position	Aggregate Compensation Paid or Owed from Registrant		Total Compensation Paid or Owed From Registrant and Fund Complex Paid to Trustees***
Lisa Anderson	$	1,221	$	129,657
John P. Arnhold, Trustee*	$	—	$	—
Candace K. Beinecke, Trustee	$	2,484	$	264,177
Jean-Marie Eveillard, Trustee*	$	—	$
Jean D. Hamilton, Trustee	$	1,325	$	139,922
James E. Jordan, Trustee	$	1,220	$	129,657
William M. Kelly, Trustee	$	1,213	$	128,577
Paul J. Lawler, Trustee	$	1,562	$	165,853
Dominique M. Raillard, Trustee (retired)***	$	1,214	$	121,000

* Interested Trustee.

** For this purpose, the fund complex consists of the First Eagle Overseas Variable Fund and the five portfolios of First Eagle Funds (Global Fund, Overseas Fund, U.S. Value Fund, Gold Fund and the First Eagle Fund of America). As of December 31, 2008, each Trustee served on the board of the Trust and that of each of the First Eagle Funds.

*** Mr. Raillard retired as a Trustee in December 2008.

In addition, all persons serving as officers of the Trust (including the Fund's Chief Compliance Officer) are employed by the Adviser and the Adviser seeks reimbursement from the Trust for salary and benefits paid to some of those persons to the extent they provide services eligible for reimbursement. This reimbursement program is described in more detail under the heading "Investment Advisory and Other Services — The Adviser."

Deferred Compensation.

In addition to the compensation detailed above, each eligible Trustee may elect to defer a portion of his or her compensation from the Fund. Such amounts grow or decline as if invested in the relevant investment fund, as selected by the Trustee. Currently, only those Trustees listed below have elected to defer a portion of their Trustee compensation under this program. As of December 31, 2008 the value of such deferred compensation — which represents

compensation from the fund complex as a whole — was equal to approximately (the funds listed are the five portfolios of First Eagle Funds):

Name of Trustee	Global Fund		Overseas Fund		U.S. Value Fund		Gold Fund		Fund of America
Lisa Anderson	$	57,716	$	57,583	$	16,053	$	19,163	$	14,476
Candace K. Beinecke	$	158,017	$	157,502	$	—	$	—	$	143,612
Jean D. Hamilton	$	—	$	253,229	$	—	$	—	$	—
William M. Kelly	$	80,357	$	—	$	77,944	$	—	$	73,067
Paul J. Lawler	$	134,508	$	22,355	$	21,743	$	26,276	$	19,789

Additional Information Regarding the Trustees. The following table sets forth information as of December 31, 2008 regarding ownership by the Trustees of the Trust of equity securities of the Trust or any other fund in the same fund complex for which each is also a director or trustee. ("Fund complex" has the same meaning as in the footnote to the compensation table above.) Dollar ranges of ownership are indicated as follows: A = None; B = $1 to $10,000; C = $10,001 to $50,000; D = $50,001 to $100,000; E = over $100,000.

INDEPENDENT TRUSTEES

Name	Dollar Range of Ownership of Equity Securities in the Fund as of December 31, 2008	Aggregate Ownership of Equity Securities in all Funds Overseen by Trustee in the Fund Complex as of December 31, 2008
Lisa Anderson	A	E
Candace K. Beinecke*	A	E
Jean D. Hamilton.	A	E
James E. Jordan	A	E
William M. Kelly	A	E
Paul J. Lawler	A	E

* These amounts do not include holdings as to which Ms. Beinecke has disclaimed beneficial interest.

INTERESTED TRUSTEES

Name	Dollar Range of Ownership of Equity Securities in the Fund as of December 31, 2008	Aggregate Ownership of Equity Securities in all Funds Overseen by Trustee in the Fund Complex as of December 31, 2008
John P. Arnhold	A	E
Jean-Marie Eveillard	A	E

Since January 1, 2008, none of the Independent Trustees who is a trustee of another investment company whose adviser and principal underwriter are ASB Advisers and First Eagle Distributors, respectively (i.e., First Eagle Funds), has held any other position with (i) the Trust (other than as a Trustee), (ii) an investment company having the same adviser or principal underwriter as the Fund or an adviser or principal underwriter that controls, is controlled by, or is under common control with the Adviser or First Eagle Distributors (other than as a Trustee), (iii) the Adviser, First Eagle Distributors or other affiliate of the Trust, or (iv) any person controlling, controlled by or under common control with the Adviser or First Eagle Distributors. Also since January 1, 2008, none of these individuals owns, beneficially or of record, securities issued by (i) the Adviser or First Eagle Distributors or (ii) any person (other than a registered investment company) directly or indirectly controlling, controlled by or under common control with the Adviser or First Eagle Distributors. Finally, none of these individuals or their immediate family members has an interest in a transaction with a "related person" of the company. A "related person" is (i) an executive officer of the Trust, (ii) an investment company having the same adviser or principal underwriter as the Fund or an adviser or principal underwriter that controls, is controlled by or is under common control with the Adviser or First Eagle Distributors, (iii) an executive officer of such an investment company, (iv) the Adviser or First Eagle Distributors, (v) an executive officer of the Adviser or First Eagle Distributors, (vi) a person directly or indirectly controlling, controlled by, or under common control with the Adviser or First Eagle Distributors, or (vii) an executive officer of a person described in clause (vi) above.

The Trust, the Adviser, and its principal distributor, First Eagle Distributors, have adopted a code of ethics under Rule 17j-1 of the Investment Company Act. This code of ethics permits personnel subject to the code to invest in securities, including securities that may be purchased or held by the Fund, with certain exceptions.

As of March 31, 2009, to the knowledge of the Trust, the Trustees and officers of the Trust, as a group, owned less than 1% of the shares of beneficial interest of the Fund. As of March 31, 2009, to the knowledge of the Trust, the following entities held 5% or more of the Fund's shares of beneficial interest (share ownership shown below is record ownership):

Name and Address Held of Record	% of Shares Held of Record
Sun Life Financial Retirement Products & Services PO Box 9134 Wellesley Hills, MA 02481–9134		87.67 %
Transamerica Life Insurance Company 4333 Edgewood RD NE Cedar Rapids, IA 52499–0001		5.58 %

Each of these identified Shareholders holds a significant interest in the Fund and, as such, may have the ability to influence or decide the outcome of matters considered by a vote among Shareholders.

While the Trust is a Delaware statutory trust, certain of its Trustees and officers are non-residents of the United States and may have all, or a substantial part, of their assets located outside the United States. As a result, it may be difficult for U.S. investors to effect service of process upon such non-U.S. Trustees or officers within the United States or effectively to enforce judgments of courts of the United States predicated upon civil liabilities of such officers or Trustees under the federal securities laws of the United States.

INVESTMENT ADVISORY AND OTHER SERVICES

The Adviser

As described in the Trust's Prospectus, ASB Advisers is the Trust's investment adviser and, as such, manages the Fund's portfolio. ASB Advisers is a subsidiary of ASB Holdings, a privately owned holding company. The Adviser's primary offices are located at 1345 Avenue of the Americas, New York, NY 10105.

Under its investment advisory contract with the Trust, which became effective December 31, 1999, ASB Advisers furnishes the Trust with investment advice consistent with the Fund's stated investment objective. Prior to December 31, 1999, the Fund had an advisory contract with Société Générale Asset Management Corp. ("SGAM Corp."). ASB Advisers also furnishes the Trust with office space and certain facilities required for the business of the Fund, and statistical and research data, and pays any expenses of the Trust's officers. Certain of these expenses (including part of the compensation of the Chief Compliance Officer and certain other of the Trust's officers) are subject to reimbursement to the Adviser as described in the next paragraph. In return, the Fund pays ASB Advisers a monthly fee at the annual rate of 0.75% of the average daily value of the Fund's net assets. This annual fee rate is higher than the rate of fees paid by most U.S. mutual funds. The Trust believes, however, that the advisory fee rate is not higher than the rate of fees paid by most other mutual funds that invest significantly in foreign equity securities.

For the fiscal years ended December 31, 2008, 2007 and 2006, the Fund paid investment advisory fees to the Adviser in the amount of $2,306,471, $2,119,889 and $1,713,735, respectively. The Adviser also performs certain administrative, accounting, operations, compliance and other services on behalf of the Fund, and, in accordance with the agreement between them, the Fund reimburses the Adviser for costs (including personnel, related overhead and other costs) related to those services. These reimbursements may not exceed an annual rate of 0.05% of the value of the Fund's average daily net assets. For the fiscal years ended December 31, 2008, 2007 and 2006, the Fund reimbursed the Adviser under this program in the amount of $63,775, $54,007 and $40,014, respectively.

The Advisory Agreement will continue in effect after the end of the initial two-year period from the date of execution only so long as such continuance is specifically approved at least annually in conformity with the Investment Company Act. The Advisory Agreement provides that the Adviser will not be liable for any error of judgment or for any loss suffered by the Fund in connection with the matters to which the Advisory Agreement relates, except a loss

resulting from willful misfeasance, bad faith, gross negligence or reckless disregard of duty. The Advisory Agreement provides that it will terminate automatically if assigned, within the meaning of the Investment Company Act, and that it may be terminated without penalty by either party upon not more than 60 days' nor less than 30 days' written notice.

Portfolio Managers

Matthew McLennan and Abhay Deshpande manage the Fund. Each of these portfolio managers receives significant input and support from a team of investment professionals. Additional information regarding these investment professionals is available on the following pages.

The following table provides information as of March 31, 2009 relating to the activities, and investments in the Fund, by the portfolio managers.

Portfolio Manager

Number of
Registered
Investment
Companies
Managed and
Total Assets
for such
Accounts*

Beneficial
Ownership of
Equity Securities
in the Fund**

Number of
Other Pooled
Investment
Vehicles
Managed and
Total Assets
for such
Accounts

Number of
Other
Accounts
Managed and
Total Assets
for such
Accounts

Matthew McLennan

4 accounts with assets
of $21.0 billion

None

2, with assets
of $708.6 million

5, with assets
of $235.8 million

Abhay Deshpande

5 accounts with assets
of $22.3 billion

None

5, with assets
of $751.4 million

5, with assets
of $235.8 million

* The data provided herein includes the Fund and the First Eagle Funds, a mutual fund complex with four portfolios managed by Mr. Deshpande, and three portfolios managed by Mr. McLennan.

** While Messrs. McLennan and Deshpande are not invested in the Fund (because they have elected not to invest through a Variable Contract), Mr. McLennan has a substantial investment in the First Eagle Global Fund, a registered investment company managed by Messrs. McLennan and Deshpande that, although it invests globally as opposed to solely outside the United States, includes a non-U.S. component that follows a strategy similar to the Fund, and Mr. Deshpande has a substantial investment in the First Eagle Overseas Fund, a registered investment company managed by Messrs. McLennan and Deshpande that follows a strategy similar to the Fund.

With respect to the accounts identified in the table above, Mr. McLennan manages two pooled investment vehicles with assets totaling $708.6 million for which the advisory fees are based in part on the performance of the accounts. None of his other managed accounts pay performance-based advisory fees. Mr. McLennan's compensation consists of salary, a performance bonus and participation in a company-sponsored retirement plan, with the performance bonus representing an important portion of total compensation. Mr. McLennan's bonus is awarded in the firm's discretion, subject to agreed minimum amounts, and will reflect the investment performance of the Fund and any other accounts managed by him, the financial results of the firm as a whole, and his contributions to the firm both as an individual and as the First Eagle Global Value Team Lead. There are no pre-determined performance or other benchmarks for these bonuses. In addition to this bonus, Mr. McLennan is entitled to receive certain payments based on the investment returns of the Global Fund and an employee forgivable loan. Mr. McLennan also received reimbursement for certain relocation and personal expenses.

With respect to the accounts identified in the table above, Mr. Deshpande manages five pooled investment vehicles totaling $751.4 million for which the advisory fees are based in part on the performance of the accounts. None of his other managed accounts pay performance-based advisory fees. Mr. Deshpande's compensation consists of salary, a performance bonus and participation in a company-funded retirement plan, with the performance bonus representing an important portion of total compensation. Mr. Deshpande's bonus is awarded in the firm's discretion, subject to agreed minimum amounts, and will reflect the investment performance of the Fund and any other accounts managed by him, the financial results of the firm as a whole, and his contributions to the firm both as an individual and as a member of the First Eagle Global Value Team. There are no pre-determined performance or other benchmarks for this bonus.

Performance fees for a particular account of the Adviser do not accrue to any particular portfolio manager. Additionally, Messrs. McLennan and Deshpande each receive profit interests, which make them eligible, subject to, among other things, customary vesting arrangements, for a share of the profits of the Adviser. Profits for this purpose are calculated firm-wide and therefore relate to investment products and business lines beyond those managed by the particular portfolio manager.

Information relating to conflicts that may be presented by the portfolio managers' management of other mutual fund and non-mutual fund accounts follows the background information relating to other investment professionals employed by the Adviser set forth below.

Although the portfolio managers may be assisted by a team of investment professionals, such as research analysts and trading personnel, no other individuals have final responsibility for Fund investment decisions. In order to provide you with additional information regarding the Adviser, the following table identifies the team of investment professionals assisting the portfolio managers and provides information regarding their professional backgrounds.

	Principal Occupation(s) During Past 5 Years	Areas of Specialty
Director of Research

Alan Barr, CFA	Mr. Barr joined the Adviser as a Research Analyst in March 2001. As an Equity Research Analyst, he spent four years at PNC Bank and, prior to that, seven years at Rittenhouse Financial Services. Mr. Barr graduated from Temple University in 1985 with an undergraduate degree in Communications.	Non-food consumer products, forest products/paper, chemicals.

Rachel Benepe...............	Ms. Benepe joined the Adviser in April 2008. Before attending business school, she worked for Prudential Securities as an Investment Banking Analyst and at Lehman Brothers as an Equity Research Associate focusing on Metals and Mining. After completing her MBA, she researched Beverages for three years at both Gabelli and Company and Citigroup and was also an Investment Analyst at Artemis Advisers, focusing on Consumer, Retail, Media and Industrials. Ms. Benepe is a graduate of the University of Pennsylvania and received her MBA from Columbia Business School in 2003. Ms. Benepe also has managed the First Eagle Gold Fund with Mr. Deshpande since February 2009.	Retail, gold, metals & mining industries, steel & coal, automobiles.

Kimball Brooker, Jr	Mr. Brooker joined the Adviser in January 2009. He began his career in 1992 as a Financial Analyst at Lazard Freres & Co. and went on to join J.P. Morgan as an Associate in the Investment Banking Department, specifically the billion dollar private equity fund Corsair. Following the completion of his MBA, Mr. Brooker returned to JPM and was named Chief Investment Officer of Corsair Funds and Managing Director in 2003. By 2006 he completed Corsair's spin-off from JPM and successfully managed nearly $3 billion. Mr. Brooker is a graduate of the Yale University and was awarded his MBA from Harvard University in 1998.	Banks, commercial services, financial services, holding companies.

Robert Hordon, CFA	Mr. Hordon joined the Adviser in 2001 as a Risk Arbitrage Analyst and became a Research Analyst for First Eagle Funds in 2008. He previously worked as an Equity Research Associate at Credit Suisse First Boston. Mr. Hordon is a graduate of Princeton University and Columbia Business School.	Retail, real estate, infrastructure, airports, aggregates.

Matt Lamphier, CFA	Mr. Lamphier joined the Adviser as a Research Analyst in May 2007. He previously worked at Merrill Lynch in Private Client Services, as an Equity Analyst at Security Capital Group, Northern Trust and, most recently, Trilogy Global Advisors. Mr. Lamphier is a graduate of the U.S. Air Force Academy and the University of Chicago Graduate School of Business.	Industrials, energy, medical devices, gaming and leisure, transportation.

	Principal Occupation(s) During Past 5 Years	Areas of Specialty
Director of Research

Omar Musa	Mr. Musa joined the Adviser in July 2008. He previously worked as an Equity Analyst for Wasatch Funds and was a Managing Partner of the Charles River Growth Fund, Harvard University's student-run fund. In addition, he is the co-founder of two major websites: TheWorldBlog.org, a nonprofit, well-renowned chronicle of Harvard students serving communities globally in an effort to raise awareness about world issues, and SoccerFansNetwork.com, which is visited by more than 2 million people a year. Mr. Musa received his B.A. with high honors in Economics from Harvard University. While at Harvard, he focused on Accounting, Behavioral Finance and Econometrics, among others, and speaks Arabic, Spanish and Portuguese.	Technology, utilities, commercial paper.

Oanh Nguyen	Ms. Nguyen joined the Adviser in January 2007. Previously, Ms. Nguyen was a Research Analyst and Trader for Wyser-Pratte Management Co., an activist hedge fund focused on undervalued European equities. Ms. Nguyen also formerly worked at the U.S. Treasury Department as a Research Assistant for the International Affairs Group. She is a graduate of Wellesley College and the Fletcher School of Law and Diplomacy at Tufts University where she was a Woodrow Wilson Fellow.	Media, telecom, pharmaceuticals.

Mark Wright, CFA	Mr. Wright joined the Adviser in July 2007. Previously, Mr. Wright was a Senior Analyst for Investment Banking at Dresner Capital Resources and, prior to that, spent 13 years at Morningstar as a Senior Analyst, Finance Consultant and Director of Tools & Portfolio Content. He is a graduate of the University of Chicago and the Sloan School of Management at MIT.	Banks, fixed income & bankruptcy, food & beverage.

In addition, Bruce Greenwald joined the Adviser as Director of Research for its First Eagle Global Value Team (a department of Arnhold and S. Bleichroeder Advisers, LLC) in September 2007. Professor Greenwald holds the Robert Heilbrunn Professorship of Finance and Asset Management at Columbia Business School and is the academic Director of the Heilbrunn Center for Graham & Dodd Investing. Messrs. McLennan and Deshpande, in conjuction with senior analysts and Professor Greenwald, are responsible for hiring, training and supervising the First Eagle Global Value Team's research analysts. Additionally, Jean-Marie Eveillard, the Fund's portfolio manager from its inception to 2004 and from March 2007 through March 2009, remains a Senior Advisor to the Adviser and continues to provide investment consultation and advice to the portfolio management team and to senior management of ASB Advisers.

Conflicts of Interest

Personnel of the Adviser (including the Fund's portfolio manager identified above) serve as portfolio managers to certain clients and unregistered investment companies that may utilize an investment program that is substantially similar to that of a fund managed by such person. In addition, the Adviser currently serves, or may in the future serve, as investment adviser to other registered investment companies, unregistered investment companies or accounts (including proprietary accounts), some of which provide for incentive compensation (such as performance fees). Consequently, the Adviser's investment management activities may present conflicts between the interests of the Fund and those of the Adviser and potentially among the interests of various accounts managed by the Adviser principally with respect to allocation of investment opportunities among similar strategies. Although the Adviser has adopted allocation procedures intended to provide for equitable treatment of all accounts over time, it is possible that circumstances may arise requiring case-by-case treatment and that each client account will not necessarily participate in the same transaction. The allocation procedures generally contemplate similar treatment for like accounts, with exceptions for various special considerations, including an account's tax position, cash management requirements, concentration tolerance or minimum investment size policies.

Conflicts also may be presented by Messrs. McLennan's and Deshpande's portfolio manager compensation arrangements, in that they are not dependent on any particular level of investment performance. Conflicts of interest also may be presented by the portfolio managers maintaining their personal investments in some of the accounts managed by them (such as First Eagle Global Fund and First Eagle Overseas Fund, each "retail" rather than "variable insurance" mutual funds operating under the First Eagle Funds name) but not in others (such as the Fund). These

arrangements may present an incentive for the portfolio managers to favor one account at the expense of another. However, as associated persons of the Adviser, the portfolio managers are subject at all times to the high ethical conduct standards imposed by the Adviser's code of ethics and the Investment Advisers Act of 1940. The Adviser believes, moreover, that the similarities in investment strategy between the Fund and the First Eagle Overseas Fund (as well as the international portion of First Eagle Global Fund's portfolio) — together with the allocation procedures described in the preceding paragraph — mitigate these conflicts. In addition, Mr. McLennan's receipt of certain payments based solely on the investment returns of the First Eagle Global Fund may present a conflict of interest in balancing his roles as portfolio manager of both that Fund and the First Eagle Overseas Variable Fund. Also, these payments to Mr. McLennan are ordinary income for him for U.S. federal income tax purposes and are not adjusted to reflect the "tax character" of the First Eagle Global Fund's investment performance, so that the payments do not directly align with the investment experience of a taxable investor.

VOTING OF PROXIES

The Board of Trustees has delegated to the Adviser the authority to vote proxies received by the Fund from the companies in which it invests (for this purpose, the "portfolio positions"). The Adviser has adopted policies and procedures (the "Policies") regarding the voting of such proxies, which policies have been reviewed and approved by the Board of Trustees as appropriate to their management of the Fund's assets. It is the policy of the Adviser to vote client proxies in a manner that serves the best interest of the client.

The Policies provide for procedures that address conflicts of interest between the Adviser and a client with respect to voting proxies. With regard to the Adviser this may involve review of a proposed vote by their compliance personnel and, in certain circumstances, will require consultation with the client or its representative (the Board of Trustees, in the case of the Trust). The Adviser may abstain from voting from time to time when it determines that the costs associated with voting a proxy outweigh the benefits derived from exercising the right to vote.

The Adviser relies on RiskMetrics ("RiskMetrics"), a third party proxy voting service, for recommendations as to voting on particular issues and for technical assistance in tracking instances in which the Fund has the opportunity to vote and in transmitting voting instructions to the relevant corporate issuer or its proxy tabulation agents. The Adviser utilizes RiskMetrics as a resource to enable it to make better-informed proxy voting decisions and to limit the potential for conflicts in the proxy voting process. The Adviser has analyzed and determined the RiskMetrics Proxy Guidelines to be largely consistent with the views of the Adviser on various types of proxy proposals. Therefore, in many cases, the voting recommendation of the third party service is followed. However, the Adviser may determine to vote a proxy in a manner other than the manner recommended by its proxy voting service provider. While other services may be relied on from time to time, the Adviser relies principally on proxy voting services provided by RiskMetrics. General information about RiskMetrics voting recommendations is available on the homepage of RiskMetrics' website at http://www.riskmetrics.com (certain guidelines on that website, however, do not apply to RiskMetrics' recommendations made for the Fund, such as those for pension plan investors and socially responsible investors).

Information regarding the Adviser's proxy-voting record on behalf of the Trust for the most recent twelve-month period ended June 30 is available by calling the Trust at (800) 334-2143 to request this information, which is also available on the SEC's website at http://www.sec.gov.

DISTRIBUTION OF THE FUND'S SHARES

First Eagle Funds Distributors, a division of ASB Securities LLC, serves as the Distributor of the Fund's shares. ASB Securities LLC is a registered broker-dealer and a member of the Financial Industry Regulatory Authority ("FINRA"). ASB Securities LLC is a wholly-owned subsidiary of ASB Holdings.

In this regard, the Trust and First Eagle Distributors have entered into a distribution contract pursuant to which First Eagle Distributors offers, as agent, share of the Fund continuously to the separate accounts of insurance companies. First Eagle Distributors is not obligated thereunder to sell any specific amount of Fund shares.

The Fund has adopted a Distribution Plan and Agreement (the "Plan") pursuant to Rule 12b-1 of the Investment Company Act. Under the Plan, the Fund may pay First Eagle Distributors a monthly distribution related fee at an annual rate not to exceed 0.25% of the average daily value of the Fund's net assets. Under the terms of the Plan, the Fund is authorized to make payments to First Eagle Distributors for remittance to an insurance company that is the issuer of a Variable Contract invested in shares of the Fund in order to pay or reimburse such insurance company for

distribution and shareholder servicing-related expenses incurred or paid by such insurance company. Distribution expenses incurred in any fiscal year, which are not reimbursed from payment under the Plan accrued in such fiscal year, will not be carried over for payment under the Plan in any subsequent year.

The Fund may, under policies approved by the Board of Trustees, from time to time, enter into arrangements with institutions to provide sub-transfer agent services and other related services (e.g. client statements, tax reporting, order-processing and client relations) where a number of persons hold Fund shares through omnibus or other "street name" accounts registered with the Fund's transfer agent, DST Systems, Inc., ("DST"), in the name of that institution. Under those arrangements, the Fund may compensate the institution rendering such services on a sub-account basis, as an asset-based fee, as a sales fee or in some cases through a combination of the three. Such compensation paid by the Fund does not amount in aggregate for more than what otherwise would have been paid to DST for the same services. For the twelve-month period ended December 31, 2008, total sub-transfer agency payments of this nature by the Fund were approximately $457,759, comprising a substantial portion of the Fund's ongoing expenses. (Any portion of sub-transfer agency fees paid in excess of what otherwise would have been paid to DST for the same services is paid by First Eagle Distributors, the Adviser and/or an affiliate of either out of its (or their) own resources, as further described below under the heading "Revenue Sharing.")

During the fiscal years ended 2008, 2007 and 2006, the Fund incurred distribution related fees for expenditures under the Plan in the aggregate amount of $768,824, $704,066 and $571,245, respectively, which constituted 0.25% of the Fund's average daily net assets during such periods. Such amount is payable to the insurance companies which issued the Variable Contracts invested in shares of the Fund.

Expenses payable pursuant to this Plan may include, but are not limited to, expenses relating to the preparation, printing and distribution of prospectuses to existing and prospective Variable Contract owners; development, preparation, printing and mailing of Fund advertisements; expenses relating to holding seminars and sales meetings designed to promote the distribution of Fund shares; training sales personnel regarding the Fund; compensating sales personnel in connection with the allocation of cash values and premiums of the Variable Contracts to the Fund; and financing any other activity that the Fund's Board of Trustees determines is primarily intended to result in the sale of shares.

The Plan is deemed reasonably likely to benefit the Fund and the Variable Contract owners in at least one of several ways. Specifically, it is expected that the insurance companies that issue Variable Contracts invested in shares of the Fund would have less incentive to educate Variable Contract owners and sales people concerning the Fund if expenses associated with such services were not paid by the Fund. In addition, the payment of distribution fees to insurers should motivate them to maintain and enhance the level of services relating to the Fund provided to Variable Contract owners, which would, of course, benefit such Variable Contract owners. The adoption of the Plan would also likely help to maintain and may lead to an increase in net assets given the foregoing incentives. Further, it is anticipated that Plan fees may be used to educate potential and existing owners of Variable Contracts concerning the Fund, the securities markets and related risks.

The Plan provides that it will continue in effect only so long as its continuance is approved at least annually by the Trust's Board of Trustees and by the trustees who are not interested persons of the Trust and who have no direct or indirect financial interest in the operation of the Plan or in any agreements relating to the Plan (previously defined as the "Independent Trustees"). In the case of an agreement relating to the Plan, the Plan provides that such agreement may be terminated, without penalty, by a vote of a majority of the Independent Trustees, or by a majority of the Fund's outstanding voting securities on 60 days' written notice to First Eagle Distributors, and provides further that such agreement will automatically terminate in the event of its assignment. The Plan also states that it may not be amended to increase the maximum amount of the payments thereunder without the approval of a majority of the outstanding voting securities (as defined above under "Management of the Trust — Investment Restrictions") of the Fund. No material amendment to the Plan will, in any event, be effective unless it is approved by a vote of the trustees and the Independent Trustees of the Trust.

When the Trust seeks an Independent Trustee to fill a vacancy on the board or as an addition to the board or as a nominee for election by stockholders, the selection or nomination of the Independent Trustee is, under resolutions adopted by the trustees, contemporaneously with their adoption of the Plan, committed to the discretion of the Independent Trustees.

Revenue Sharing

The Distributor, the Adviser or an affiliate may, from time to time, out of its (or their) own resources, make cash payments — sometimes referred to as "revenue sharing" — to insurance companies or their representatives for various reasons. These payments may support the delivery of services to the Fund or to shareholders in the Fund, including, without limitation, transaction processing and sub-accounting services. These payments also may serve as an incentive to sell shares of the Fund and/or to promote retention of customer assets in the Fund. As such, they may be made to firms that provide various marketing support or other promotional services relating to the Fund, including, without limitation, advertising, access on the part of the Distributor's personnel to sales meetings, sales representatives and/or management representatives of the insurance company or other financial intermediary, as well as inclusion of the Fund in various promotional and sales programs. Marketing support services also may include business planning assistance, educating broker dealer personnel about the Fund and shareholder financial planning assistance.

Revenue sharing payments may include any portion of the sub-transfer agency fees described in the section preceding this revenue sharing discussion that exceed the costs of similar services provided by the Fund's transfer agent, DST. Such excess sub-transfer agency payments are paid by the Distributor, the Adviser or an affiliate out of its or their own resources. For the twelve-month period ended December 31, 2008, payments totaled $249,895, and any such payments in the future will vary according to a number of factors (including, for example, numbers of shareholder accounts serviced).

Revenue sharing also may include any other payment requirement of an insurance company. All such payments are paid by the Distributor, the Adviser or an affiliate of either out of its (or their) own resources and are in addition to any Rule 12b-1 payments described elsewhere in this Statement of Additional Information. Revenue sharing payments may be structured: (i) as a percentage of sales; (ii) as a percentage of net assets; (iii) as a fixed dollar amount; or (iv) as some combination of any of these. In many cases, they therefore may be viewed as encouraging sales activity or retention of assets in the Fund. Generally, any revenue sharing or other payments of the type just described will have been requested by the party receiving them, often as a condition of distribution, but are subject to negotiation as to their structure and scope.

The Distributor, the Adviser and/or an affiliate of either also pays from its (or their) own resources for travel and other expenses, including lodging, entertainment and meals, incurred by insurance companies or their representatives related to diligence or informational meetings in which insurance company representatives meet with investment professionals employed by the Fund's investment adviser, as well as for costs of organizing and holding such meetings. The Fund and/or such related parties to the Fund also may make payments to or on behalf of insurance companies or their representatives for other types of events, including sales or training seminars, and may provide certain small gifts and/or entertainment as permitted by applicable rules.

Shareholders or prospective Variable Contract investors should be aware that revenue sharing arrangements or other payments to intermediaries could create incentives on the part of the parties receiving the payments to more positively consider the Fund relative to mutual funds either not making payments of this nature or making smaller such payments. A shareholder or prospective Variable Contract investor with questions regarding revenue sharing or other such payments may obtain more details by contacting his or her insurance company representative or other financial intermediary directly.

COMPUTATION OF NET ASSET VALUE

The Fund computes its net asset value once daily as of the close of trading on each day the New York Stock Exchange is open for trading. The Exchange is closed on the following days: New Year's Day, Rev. Dr. Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. The net asset value per share is computed by dividing the total current value of the assets of the Fund, less its liabilities, by the total number of shares outstanding at the time of such computation.

A portfolio security (including an option), other than a bond, which is traded on a U.S. national securities exchange or a securities exchange abroad is normally valued at the price of the last sale on the exchange as of the close of business on the date on which assets are valued. If there are no sales on such date, such portfolio securities will be valued at the mean between the closing bid and asked prices (and if there is only a bid or only an asked price on such date, valuation will be at such bid or asked price for long or short positions, respectively). In the case of an option traded on a securities exchange for which a last sale price is not available, the option may be valued at its NBBO (national best bid and offer)

reported by the Options Price Reporting Authority. Securities, other than bonds, traded in the over-the-counter market are valued at the mean between the last bid and asked prices prior to the time of valuation (and if there is only a bid or only an asked price on such date, valuation will be at such bid or asked price for long or short positions, respectively), except if such unlisted security is traded on the NASDAQ in which case it is valued at its last sale price (or, if available in the case of NASDAQ securities, the NASDAQ Official Closing Price ("NOCP")).

Commodities (such as physical metals) are valued at the spot price at the time trading on the New York Stock Exchange closes (normally 4:00 p.m. E.S.T.). Forward currency contracts are valued at the current cost of covering or offsetting such contracts.

All bonds, whether listed on an exchange or traded in the over-the-counter market (and except for short-term instruments as described in the next sentence), for which market quotations are readily available are valued at the mean between the last bid and asked prices received from dealers in the over-the-counter market in the United States or abroad, except that when no asked price is available, bonds are valued at the last bid price alone. Short-term investments maturing in sixty days or less are valued at cost plus interest earned (or discount amortized, as the case may be), which is deemed to approximate value.

The 2:00 p.m. E.S.T. exchange rates typically are used to convert foreign security prices into U.S. dollars. Any security that is listed or traded on more than one exchange (or traded in multiple markets) is valued at the relevant quotation on the exchange or market deemed by the Adviser to be the primary trading venue for that security. In the absence of such a quotation, a quotation from the exchange or market deemed by the Adviser to be the secondary trading venue for the particular security shall be used. The Fund uses pricing services to identify the market prices of publicly traded securities in its portfolio. When market prices are determined to be "stale" as a result of limited market activity for a particular holding, or in other circumstances when market prices are unavailable, such as for private placements, or determined to be unreliable for a particular holding, such holdings may be "fair valued" in accordance with procedures approved by the Board of Trustees.

Additionally, with respect to foreign holdings, specifically in circumstances leading the Adviser to believe that significant events occurring after the close of a foreign market have materially affected the value of the Fund's holdings in that market, such holdings may be fair valued to reflect the events in accordance with procedures approved by the Board. The determination of whether a particular foreign investment should be fair valued will be based on review of a number of factors, including developments in foreign markets, the performance of U.S. securities markets, and security-specific events. The Fund has adopted procedures under which movements in the prices for U.S. securities (beyond specific thresholds) occurring after the close of the foreign market generally require fair valuation of securities traded on that foreign market. The values assigned to the Fund's holdings therefore may differ on occasion from reported market values, especially during periods of higher market price volatility. The Trust and the Adviser believe relying on the procedures described above will result in prices that are more reflective of the actual market value of portfolio securities held by the Fund.

DISCLOSURE OF PORTFOLIO HOLDINGS

The Fund's portfolio holdings are made public, as required by law, in the Fund's annual and semi-annual reports. These reports are filed with the SEC and mailed to shareholders approximately 60 days after the last day of the relevant period. (In addition, these reports are available upon request as described on the front cover of this Statement of Additional Information.) Also as required by law, the Fund's portfolio holdings are publicly reported to the SEC approximately 60 days after the last day of the Fund's relevant first or third fiscal quarterly period.

When authorized by appropriate executive officers of the Fund, portfolio holdings information may be given more frequently than as just described to third-party Fund service providers, various mutual fund rating and ranking organizations and certain affiliated persons of the Fund. As of the date of this Statement of Additional Information, these persons are limited to the Distributor, the Fund's custodian (full portfolio daily, no lag) and internal and external (State Street Bank & Trust Co.) accounting personnel (full portfolio daily, no lag), the Fund's independent registered public accounting firm, various portfolio management and/or trading systems (ePAM, Eze Castle, ITGTCA, STAARS, Charles River) (disclosure may vary but may sometimes include full portfolio daily, no lag), Institutional Shareholder Services (full portfolio at month end, no lag) and other proxy voting agents, Command Financial Press Corporation and Merrill Corporation, in connection with financial printing (full portfolio quarterly, approximately 30-day lag), portfolio analytics software provider FactSet Research Systems (full portfolio daily, no lag — only advisory and advisory support personnel of the Adviser have access to the FactSet outputs derived from these disclosures), and the following

mutual fund rating/ranking organizations, whose further dissemination is subject to the subscription rules of these rating/ranking organizations: Morningstar (full portfolio month-end, 45-day lag), Lipper (full portfolio month-end, 45-day lag), Bloomberg (full portfolio semi-annually, 45-day lag), and CDA Weisenberger/Thomson Financial (full portfolio month-end, 45-day lag). Finally, on occasion the Fund may disclose one or more individual holdings to pricing or valuation services (or to broker-dealers acting as market makers) for assistance in considering the valuation of the relevant holdings. The Fund's regular pricing and fair valuation services are Reuters, FT Interactive Data (IDC), Bloomberg, PinkSheets.com, and OTCQuote.com (all such services have access to some or all of the portfolio daily, no lag).

In each of the cases described in the preceding paragraph, the information provided is subject to limitations on use intended to prohibit the recipient from trading on or inappropriately further disseminating it. As part of the internal policies and procedures, conflicts between the interests of the investors and those parties receiving portfolio information will be considered. In addition to the Fund's policies and procedures in this area, a number of Fund service providers maintain their own written procedures limiting use and further transmission of portfolio holdings information disclosed to them. Neither the Fund nor the Adviser (nor its affiliates) nor any other person receives any compensation in connection with disclosure of information to these parties, and all such arrangements are pursuant to policies approved by the Board of Trustees, which has determined that they are appropriate and in the best interests of Fund shareholders. These Fund policies and procedures will be reviewed by the Trustees on an annual basis, for adequacy and effectiveness, in connection with the Fund's compliance program under Rule 38a-1 under the Investment Company Act; and related issues will be brought to the attention of the Trustees on an as appropriate basis.

Additionally, the Adviser or its personnel from time to time may comment to the press, Fund Variable Contract holders, prospective investors, or contract holder or investor fiduciaries or agents (orally or in writing) on one or more of the Fund's portfolio securities or may state that the Fund recently purchased or sold one or more securities. This commentary also may include such statistical information as industry, country or capitalization exposure, credit quality information, specialized financial characteristics (alpha, beta, maturity, Sharpe ratio, standard deviation, default rate, etc.), price comparisons to various measures, portfolio turnover and the like. No comments may be made, however, if likely to permit, in the sole judgment of the Adviser, inappropriate trading of Fund shares or of Fund portfolio securities.

HOW TO PURCHASE SHARES

The methods of buying and selling shares and the sales charges applicable to purchases of shares of the Fund are described in the prospectus of the pertinent separate account.

TAX STATUS

This summary of the U.S. federal income tax status of the Fund is based on the U.S. federal income tax laws, regulations, rulings and decisions in effect or available on the date of this Statement of Additional Information. All of the foregoing are subject to change, which change may apply retroactively and could affect the continued validity of this summary.

Prospective purchasers of shares of the Fund should consult their own tax advisors as to the U.S. federal income tax consequences of the purchase, ownership and disposition of such shares, including the possible application of state, local, non-U.S. or other tax laws.

The Fund has elected and intends to qualify annually as a "regulated investment company" under the Internal Revenue Code of 1986, as amended (the "Code") and the Treasury regulations promulgated thereunder. In order to qualify as a regulated investment company for a taxable year, the Fund must, among other things, (a) derive at least 90% of its gross income from dividends, interest, payments with respect to certain securities loans, net income derived from interests in qualified publicly traded partnerships ("PTPs"), gains from the sale or other disposition of stock, securities or foreign currencies or other income (such as gains from options, futures or forward contracts) derived with respect to the business of investing in such stock, securities or currencies; (b) diversify its holdings so that, at the end of each fiscal quarter, (i) at least 50% of the market value of its assets is represented by cash, cash items, U.S. government securities, securities of other regulated investment companies and other securities, with such other securities of any one issuer qualifying only if the Fund's investment is limited to an amount not greater than 5% of the value of the Fund's assets and not more than 10% of the voting securities of such issuer, and (ii) not more than 25% of the value of its assets is invested in the securities of any one issuer (other than U.S. government securities or securities of other regulated investment companies) or of two or more issuers which the Fund controls and which are determined, under Treasury regulations, to be engaged in the same or similar trades or businesses or related trades or businesses or securities of one

or more qualified PTPs; and (c) distribute at least 90% of its investment company taxable income (which includes, among other items, dividends and interest net of expenses and net short-term capital gains in excess of net long-term capital losses) for the year.

The Fund may invest in certain assets, such as gold bullion, that do not constitute "securities" for purposes of the regulated investment company qualification tests referred to in the previous paragraph and other assets, including various derivative and structured investment products, the status of which as "securities" for such purposes may not be fully settled. If a sufficient portion of the Fund's assets is not stock or such securities or if a sufficient portion of the Fund's gross income is not derived from stock or such securities for any taxable year, the Fund will fail to qualify as a regulated investment company for such taxable year.

As a regulated investment company, the Fund generally will not be subject to U.S. federal income tax on its investment company taxable income and net capital gains (the excess of net long-term capital gains over net short-term capital losses), if any, that it distributes to shareholders. The Fund intends to distribute to its shareholders (the separate accounts), at least annually, substantially all of its investment company taxable income and net capital gains. The Fund will not be subject to the 4% excise tax if it fails to distribute 98% of its income in accordance with certain calendar year requirements if at all times during any calendar year: (i) all of the Fund's shareholders (other than for organizational shares) are either pension trusts described in section 401(a) of the Code and exempt from U.S. Federal income tax under section 501(a) of the Code or segregated asset accounts of life insurance companies held in connection with variable contracts, as defined in section 817(d) of the Code and (ii) any shares attributable to an investment in the Fund made in connection with the organization of the Fund do not exceed $250,000. A distribution will be treated as paid on December 31 of the current calendar year if it is declared by the Fund in October, November or December with a record date in such a month and paid by the Fund during January of the following calendar year. Finally, any foreign currency transactions that are not directly related to the Fund's investments in securities (possibly including, but not limited to, speculative currency positions or currency derivatives not used for hedging purposes) could, under future administrative guidance issued by the Internal Revenue Service, produce income not among the types of "qualifying income" from which the Fund must derive at least 90% of its annual gross income.

If in any taxable year the Fund fails to qualify as a regulated investment company under the Code, the Fund would be taxed in the same manner as a corporation and distributions to its shareholders would not be deductible by the Fund in computing its taxable income. In addition, in order to requalify for taxation as a regulated investment company that is accorded special tax treatment, the Fund may be required to recognize unrealized gains, incur substantial taxes and interest on such unrealized gains, and make certain substantial distributions. Furthermore, failure to qualify as a regulated investment company may cause the Variable Contracts to fail the diversification standards under section 817(h) of the Code as discussed below.

Aside from the requirements attendant to the Fund's qualification as a regulated investment company discussed above, section 817(h) of the Code imposes certain diversification standards on the underlying assets of variable annuity contracts and variable life insurance policies. The Code provides that a variable annuity contract and a variable life insurance policy shall not be treated, respectively, as an annuity contract or life insurance policy for any period for which the investments are not, in accordance with the Treasury regulations, adequately diversified. Disqualification of the contract or policy as an annuity contract or life insurance policy would result in the immediate imposition of U.S. federal income tax on the owners of such variable annuity contract and variable life insurance policy, respectively, with respect to earnings allocable to the contract or policy (including accumulated earnings), and the U.S. federal income tax liability would generally arise prior to the receipt of payments under the contracts. section 817(h)(2) of the Code is a safe harbor rule which provides that a variable annuity contract or a variable life insurance policy satisfies the diversification requirements if, as of the close of each quarter of a taxable year, the underlying assets of such contract or policy meet the diversification standards for a regulated investment company, and no more than 55% of such contract's or policy's total underlying assets consist of cash, cash items, U.S. government securities, and securities of other regulated investment companies. The Treasury Department has issued Treasury regulations (specifically section 1.817-5 of the Treasury regulations — the "Regulations") that establish diversification requirements for the investment portfolios underlying variable insurance contracts. The Regulations amplify the diversification requirements for variable annuity contracts and variable life insurance policies set forth in section 817(h) of the Code, and provide an alternative to the safe harbor provision described above. Under the Regulations, an investment portfolio will be deemed adequately diversified if: (1) no more than 55% of the value of total assets is represented by any one investment; (2) no more than 70% of such value is represented by any two investments; (3) no more than 80% of such value is represented by any three investments; and (4) no more than 90% of such value is represented by any four investments. For purposes of

the Regulations, all securities of the same issuer are treated as a single investment, but each U.S. Government agency and instrumentality is treated as a separate issuer. The Regulations provide that, in the case of a regulated investment company whose shares are available to the public only through variable insurance contracts (such as the Fund) which meet certain other requirements, the diversification tests are applied by reference to the underlying assets owned by the regulated investment company (i.e., on a "look-through" basis) rather than by reference to the shares of the regulated investment company owned under the annuity contract. The Fund intends to meet the requirements for application of the diversification tests on a look-through basis.

The Treasury Department has indicated in published statements that it will issue Treasury regulations or rulings addressing the circumstances in which a variable contract owner's control of the investments of a separate account may cause such contract owner, rather than the insurance company, to be treated as the owner of the assets held by the separate account. If the contract owner is considered the owner of the securities underlying the separate account, income and gains produced by those securities will be included currently in the contract owner's gross income. It is not known at the present time what standards will be set forth in such Treasury regulations or rulings.

In the event that such rules or Treasury regulations were adopted, there can be no assurance that the Fund will be able to operate as currently described in the Prospectus, or that the Fund will not have to change its investment objective or investment policies. Furthermore, the Fund would still be required to comply with the diversification requirements set forth in section 817(h) and the Regulations. However, it is possible that in order to comply with the aforementioned diversification requirements, less desirable investment decisions may be made which could affect the investment performance of the Fund.

Variable annuity contracts and variable life insurance policies purchased through insurance company separate accounts provide for the accumulation of all earnings from interest, dividends, and capital appreciation generally without current U.S. federal income tax liability for an individual owner. Different rules apply to corporations, taxable trusts, or other entities which own variable annuity contracts and variable life insurance policies. Depending on the variable annuity contract or variable life insurance policy, distributions from the contract or policy may be subject to U.S. federal income tax, as well as a 10% penalty tax on distributions to the policyholder before age 59 ¹ / ₂ . Only the portion of a distribution attributable to income on the investment in the contract or policy should be subject to U.S. federal income tax. Additional state and/or local income taxes and penalties could be imposed on such distributions. For a further discussion of investing in variable annuity contracts or variable life insurance policies, please refer to the prospectus offered by the participating insurance company. In addition, investors should consult their own tax advisors for a more complete discussion of possible U.S. federal income tax consequences to their particular situations.

Investments by the Fund in securities issued or acquired at a discount, or providing for deferred interest or payment of interest as in the form of additional obligations could result in income to the Fund equal generally to a portion of the excess of the face value of the securities over their issue or acquisition price (the "original issue discount") each year that the securities are held, even though the Fund receives no actual interest payments. In addition, a Fund's investment in foreign currencies or foreign currency denominated or referenced debt, certain asset-backed securities, "section 1256 contracts" (as described below) and contingent payment and inflation-indexed debt instruments also may increase or accelerate the Fund's recognition of income, including the recognition of taxable income in excess of cash generated by such investments. Such income must be included in determining the amount of income which the Fund must distribute in order to meet various distribution requirements. In such case, the Fund could be required to dispose of securities which it might otherwise have continued to hold or borrow to generate cash to satisfy its distribution requirements.

Certain regulated futures contracts, nonequity options, and foreign currency contracts in which the Fund may invest may be "section 1256 contracts." Gains or losses on section 1256 contracts generally are considered 60% long-term and 40% short-term capital gains or losses; however, foreign currency gains or losses arising from certain section 1256 contracts may be treated as ordinary income or loss. Also, section 1256 contracts held by the Fund at the end of each taxable year (and, generally, for purposes of the 4% excise tax, on October 31 of each year) are "marked-to-market" for U.S. federal income tax purposes (that is, treated as sold at their fair market value), resulting in unrealized gains or losses being treated as though they were realized.

Generally, the hedging transactions undertaken by the Fund may result in "straddles" for U.S. federal income tax purposes. The straddle rules may cause certain gains to be treated as short-term rather than long-term and certain losses to be treated as long-term rather than short-term. In addition, losses realized by the Fund on positions that are part of a straddle may be deferred under the straddle rules, rather than being taken into account in calculating the taxable income for the taxable year in which the losses are realized and certain interest expenses may be required to be

capitalized. The U.S. federal income tax consequences to the Fund of engaging in hedging transactions are not entirely clear. Hedging transactions may defer the recognition of losses, which could cause the gains required to be distributed by the Fund to exceed realized net gains.

The Fund may make one or more of the elections available under the Code which are applicable to straddles. If the Fund makes any of such elections, the amount, character and/or timing of the recognition of gains or losses from the affected straddle positions will be determined under rules that vary according to the election(s) made. The rules applicable under certain of the elections may operate to accelerate the recognition of gains or losses from the affected straddle positions.

Because the straddle rules may affect the character of gains or losses, defer losses and/or accelerate the recognition of gain or losses from the affected straddle positions, the amount which must be distributed to shareholders as ordinary income or long-term capital gains may be increased or decreased, respectively, compared to a fund that did not engage in such hedging transactions.

Notwithstanding any of the foregoing, the Fund may recognize gain from a constructive sale of certain "appreciated financial positions" if generally the Fund enters into a short sale or offsetting notional principal contract with respect to, or a futures or a forward contract to deliver, the same or substantially identical property, or in the case of an appreciated financial position that is a short sale, an offsetting notional principal contract or a futures or forward contract, if the Fund acquires the same or substantially identical property as the underlying property for the position. Appreciated financial positions subject to this constructive sale treatment are interests (including options and forward contracts and short sales) in stock, partnership interests, certain actively traded trust instruments and certain debt instruments. Constructive sale treatment does not apply to certain transactions that are closed before the end of the 30th day after the end of the taxable year in which the transaction was entered into if the taxpayer holds the appreciated financial position throughout the 60 day period beginning on the date the transaction is closed and at no time during this 60 day period is the taxpayer's risk of loss with respect to the appreciated financial position reduced by certain circumstances.

If the Fund has long-term capital gain from a "constructive ownership transaction" with respect to any financial asset, the amount of such gain which may be treated as long-term capital gain by the Fund is limited to the amount of such gain which the Fund would have recognized if it had been holding such financial asset directly, rather than through a constructive ownership transaction, with any gain in excess of this amount being treated as ordinary income. In addition, any such gain recharacterized as ordinary income is treated as having been realized ratably over the duration of such constructive ownership transaction grossed up by an interest charge when reported in the year recognized. A constructive ownership transaction includes holding a long position under a notional principal contract with respect to, or entering into a forward or futures contract to acquire, certain financial assets, or both holding a call option and granting a put option with respect to certain financial assets where such options have substantially equal strike prices and substantially contemporaneous maturity dates.

Under the Code, gains or losses attributable to fluctuations in exchange rates which occur between the time the Fund accrues receivables or liabilities denominated in a foreign currency or determined with reference to one or more foreign currencies and the time the Fund actually collects such receivables, or pays such liabilities, generally are treated as ordinary income or loss. Similarly, on disposition of debt securities denominated in a foreign currency or determined with reference to one or more foreign currencies, gains or losses attributable to fluctuations in the value of foreign currency between the date of acquisition of the security or contract and the date of disposition thereof also are treated as ordinary income or loss. Generally gains or losses with respect to forward contracts, futures contracts, options or similar financial instruments (other than regulated futures contracts or new equity options that are section 1256 contracts) which are denominated in a foreign currency or determined by reference to the value of one or more foreign currencies are treated as ordinary gains or losses, as the case may be. These gains or losses, which are governed by section 988 of the Code, may increase or decrease the amount of the Fund's investment company taxable income to be distributed to its shareholders as ordinary income. However, in certain circumstances, it may be possible to make an election to treat such gains or losses as capital gains or losses or as subject to the rules applicable to section 1256 contracts, rather than subject to section 988 treatment.

The Fund may be subject to foreign withholding taxes on income and gains derived from its investments outside the United States. Such taxes would reduce the yield on the Fund's investments. Tax treaties between certain countries and the United States may reduce or eliminate such withholding taxes.

Although under certain circumstances, the Fund would be able to treat such foreign withholding taxes as paid by its shareholders, variable annuity contracts and variable life insurance policies cannot claim the benefit of the foreign tax credit from foreign withholding taxes paid on foreign securities held by the Fund.

Investments by the Fund in stock of certain foreign corporations that have more than 75% passive income on an annual basis or more than 50% passive assets by value (referred to as "passive foreign investment companies" or "PFICs"), will be subject to special tax rules designed to prevent deferral of U.S. federal income taxation of the Fund's share of the PFIC's earnings. In the absence of certain elections to report these earnings on a current basis, regardless of whether the Fund actually receives any distributions from the PFIC, the Fund would be required to report certain "excess distributions" from, and any gain from the disposition of stock of, the PFIC as ordinary income. Such ordinary income from excess distributions and gain from disposition of PFIC stock would be allocated ratably to the Fund's holding period for the stock. Any amounts allocated to prior taxable years would be taxable to the Fund at the highest rate of U.S. federal income tax on ordinary income applicable in that year, increased by an interest charge at the rate prescribed for underpayments of tax. Amounts allocated to the year of the distribution or disposition would be included in the Fund's net investment income for that year and, to the extent distributed as a dividend to the Fund's shareholders, would not be taxable to the Fund.

The Fund may be able to elect to mark to market its PFIC stock, resulting in the stock being treated as sold at fair market value on the last business day of each taxable year. Any resulting gain and any gain from an actual disposition of the stock would be reported as ordinary income; any resulting loss and any loss from an actual disposition of the stock would be reported as ordinary loss to the extent of any net gains reported as ordinary income in prior years. Alternatively, the Fund may be able to make an election, known as a qualified electing fund ("QEF") election, in lieu of being taxable in the manner described above, to include annually in income its pro rata share of the ordinary earnings and net capital gain of the PFIC, regardless of whether it actually received any distributions from the PFIC. These amounts would be included in the Fund's investment company taxable income and net capital gain which, to the extent distributed by the Fund as ordinary or capital gain dividends, as the case may be, would not be taxable to the Fund (but would be taxable to shareholders). In order to make a QEF election, the Fund would be required to obtain certain information from PFICs in which it invests, which in many cases may be difficult to obtain.

Fund shareholders may be subject to state, local and foreign taxes on their Fund distributions and redemptions of Fund shares. Also, the U.S. federal income tax consequences to a foreign shareholder of an investment in the Fund may be different from those described above. Shareholders are advised to consult their own tax advisers with respect to the particular tax consequences to them of an investment in the Fund.

PORTFOLIO TRANSACTIONS AND BROKERAGE

The Adviser is responsible for decisions to buy and sell securities, futures and options on securities, on indices and on futures for the Fund, the selection of brokers, dealers and futures commission merchants to effect those transactions and the negotiations of brokerage commissions, if any. Broker-dealers and futures commission merchants may receive brokerage commissions on Fund portfolio transactions, including options and the purchase and sale of underlying securities or futures positions upon the exercise of options. Orders may be directed to any broker or futures commission merchant to the extent and in the manner permitted by applicable law.

Substantially all brokers through whom the Adviser executes agency orders provide proprietary research on general economic trends or particular companies. Selected brokers provide third-party research and brokerage services, that is, services obtained by the broker from a third party that the broker then provides to the Adviser. The Adviser may obtain quote and other market data information in this manner. Certain brokers may also invite investment personnel of the Adviser to attend investment conferences sponsored by such brokers.

Brokerage commissions generally are negotiated in the case of U.S. securities transactions, but in the case of foreign securities transactions may by fixed and may be higher than prevailing U.S. rates. Commission rates are established pursuant to negotiations with the executing parties based on the quantity and quality of the execution services.

Equity securities traded in over-the-counter market and bonds, including convertible bonds, are generally traded on a 'net' basis with dealers acting as principal for their own accounts without a stated commission, although the price of the security usually includes a profit to the dealer. In underwritten offerings, securities are purchased at a fixed price which includes an amount of compensation to the underwriters, generally referred to as the underwriter's concession

or discount. On occasion, certain money market instruments and U.S. government agency securities may be purchased directly from the issuer, in which case no commissions or discounts are paid. The Fund will not deal with the Distributor in any transaction in which the Distributor acts as principal. Thus, it will not deal with the Distributor acting as market maker, and it will not execute a negotiated trade with the Distributor if execution involves the Distributor acting as principal with respect to any part of the Fund's order.

Portfolio securities may not be purchased from any underwriting or selling group of which the Distributor, during the existence of the group, is a member, except in accordance with rules of the Securities and Exchange Commission. This limitation, in the opinion of the Company, will not significantly affect a Fund's ability to pursue its present investment objective.

In placing orders for portfolio securities or futures, the Adviser is required to give primary consideration to obtaining the most favorable price and efficient execution. Within the framework of this policy, the Adviser will consider the research and investment services provided by brokers, dealers or futures commission merchants who effect or are parties to portfolio transactions of the Fund, the Adviser or the Adviser's other clients. Such research and investment services are those which brokerage houses customarily provide to institutional investors and include statistical and economic data and research reports on particular companies and industries. In general, research and brokerage services obtained from brokers are used by the Adviser in connection with all of its investment activities, and some of such services obtained in connection with the execution of transactions for the Fund may be used in managing other investment accounts. Conversely, brokers, dealers or futures commission merchants furnishing such services may be selected for the execution of transactions of such other accounts, whose aggregate assets are far larger than the Funds, and the services furnished by such brokers, dealers or futures commission merchants may be used by the Adviser in providing investment management for the Fund. Commission rates are established pursuant to negotiations with the broker, dealer or futures commission merchant based on the quality and quantity of execution services provided by the executing party in the light of generally prevailing rates. In addition, the Adviser is authorized to pay higher commissions on brokerage transactions for the Fund to brokers other than the Distributor in order to secure the research and investment services described above, subject to review by the Board of Trustees from time to time as to the extent and continuation of this practice. The allocation of orders among brokers and the commission rates paid are reviewed periodically by the Board of Trustees.

Subject to the above considerations, the Distributor may act as a securities broker for the Fund. In order for the Distributor to effect any portfolio transactions for the Fund, the commissions, fees or other remuneration received by the Distributor must be reasonable and fair compared to the commissions, fees or other remuneration paid to other brokers in connection with comparable transactions involving similar securities being purchased or sold on an Exchange during a comparable period of time. This standard would allow the Distributor to receive no more than the remuneration expected to be received by an unaffiliated broker in a commensurate arms-length transaction.

Furthermore, the Board of Trustees, including a majority of the Trustees who are not 'interested' directors, has adopted procedures which are reasonably designed to provide that any commissions, fees or other remuneration paid to the Distributor is consistent with the foregoing standard. Brokerage transactions with the Distributor also are subject to such fiduciary standards as may be imposed by applicable law. From time to time, the Fund may engage in agency cross transactions and cross transactions with respect to securities that meet its investment objective and policies. An agency cross transaction occurs when a broker sells securities from one client's account to another client's account.

The Fund may from time to time sell or purchase securities to or from companies or persons who are considered to be affiliated with the Fund solely because they are investment advisory clients of the Distributor or the Adviser. No consideration other than cash payment against prompt delivery at the then current market price of the securities will be paid to any person involved in those transactions. Additionally, all such transactions will be consistent with procedures adopted by the Board of Trustees.

For the years ended December 31, 2008, 2007 and 2006, the Fund paid a total of $244,313, $504,836 and $265,972, respectively, in brokerage commissions, with respect to portfolio transactions aggregating $111,760,029, $244,203,853 and $119,374,504, respectively, all of which was placed with brokers or dealers who provide research and investment information. For the same periods, there were no such brokerage commissions with respect to portfolio transactions placed with broker-dealers considered to be related parties of the Adviser.

FUND SHARES

The shares of beneficial interest of the Trust currently are designated as shares of the Fund. All shares issued and outstanding are fully paid and non-assessable and are redeemable at net asset value at the option of shareholders. Shares have no preemptive or conversion rights and are freely transferable. The Board of Trustees is authorized to classify, reclassify and issue any unissued shares of the Fund without shareholder approval. Accordingly, in the future, the Trustees may create additional series of shares (or classes) with different investment objectives, policies or restrictions. Any issuance of shares of another series or class would be governed by the Investment Company Act and Delaware law.

Pursuant to its By-Laws, the Trust does not generally hold annual meetings of shareholders. Shareholder meetings, however, will be held when required by the Investment Company Act or Delaware law, or when called by the Chairman of the Board, the President or shareholders owning at least 10% of the outstanding shares of the Fund. The cost of any such notice and meeting will be borne by the Fund.

Each share of the Fund is entitled to one vote for each dollar of net asset value and a proportionate fraction of a vote for each fraction of a dollar of net asset value, unless a different allocation of voting rights is required under applicable law for a mutual fund that is an investment medium for Variable Contracts. Generally, shares of each series vote together on any matter submitted to shareholders, except when otherwise required by the Investment Company Act, or (if shares of more than one series are outstanding) when a matter affects the interests of each series in a different way, in which case the shareholders of each series vote separately by class. If the Trustees determine that a matter does not affect the interests of a particular series, then the shareholders of that series will not be entitled to vote on that matter. An insurance company issuing a Variable Contract invested in shares of the Fund (or any other series issued in the future) will request voting instructions from Variable Contract owners and will vote shares in proportion to the voting instructions received.

CUSTODY OF PORTFOLIO

The Trust's custodian and foreign custody manager for the Fund's assets is State Street Bank and Trust Company, 801 Pennsylvania Avenue, Kansas City, Missouri 64105.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PricewaterhouseCoopers LLP ("PwC"), 300 Madison Avenue, New York, New York 10017-6204 serves as the Trust's independent registered public accountant. PwC audits the Fund's financial statements and renders its report thereon, which is included in the Annual Report to Shareholders. Prior to fiscal year 2006, a different accounting firm served as the independent registered public accounting firm for the Fund.

FINANCIAL STATEMENTS

The Fund's financial statements and notes thereto appearing in the December 31, 2008 Annual Report to Shareholders and the report thereon of PwC are incorporated by reference in this Statement of Additional Information. The Fund will furnish, without charge, a copy of the Annual Report to Shareholders on request. All such requests should be directed to the First Eagle Variable Funds, at 1345 Avenue of the Americas, New York, NY 10105.

APPENDIX

RATINGS OF INVESTMENT SECURITIES

The rating of a rating service represents the service's opinion as to the credit quality of the security being rated. However, the ratings are general and are not absolute standards of quality or guarantees as to the creditworthiness of an issuer. Consequently, the Trust's investment adviser believes that the quality of debt securities in which the Fund invests should be continuously reviewed. A rating is not a recommendation to purchase, sell or hold a security, because it does not take into account market value or suitability for a particular investor. When a security has received a rating from more than one service, each rating should be evaluated independently. Ratings are based on current information furnished by the issuer or obtained by the ratings services from other sources which they consider reliable. Ratings may be changed, suspended or withdrawn as a result of changes in or unavailability of such information, or for other reasons.

The following is a description of the characteristics of ratings used by Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's Corporation ("S&P").

Moody's Ratings.

Aaa —Bonds rated Aaa are judged to be the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt-edge." Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. Although the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such bonds.

Aa —Bonds rated Aa are judged to be high quality by all standards. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa bonds or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than in Aaa bonds.

A —Bonds rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment sometime in the future.

Baa —Bonds rated Baa are considered as medium grade obligations; i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.

Ba —Bonds rated Ba are judged to have speculative elements; their future cannot be considered as well assured. Often the protection of interest and principal payments may be very moderate and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.

B —Bonds rated B generally lack characteristics of a desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small.

Caa —Bonds rated Caa are of poor standing. Such bonds may be in default or there may be present elements of danger with respect to principal or interest.

Ca —Bonds rated Ca represent obligations which are speculative to a high degree. Such bonds are often in default or have other marked shortcomings.

C —Bonds which are rated C are the lowest rated class of bonds, and can be regarded as having extremely poor prospects of ever attaining any real investment standing.

S&P Ratings.

AAA —Bonds rated AAA have the highest rating. Capacity to pay principal and interest is extremely strong.

AA —Bonds rated AA have a very strong capacity to pay principal and interest and differ from AAA bonds only to a small degree.

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A —Bonds rated A have a strong capacity to pay principal and interest, although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than bonds in higher rated categories.

BBB —Bonds rated BBB are regarded as having an adequate capacity to pay principal and interest. Whereas they normally exhibit protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay principal and interest than for bonds in higher rated categories.

BB — B — CCC — CC —Bonds rated BB, B, CCC and CC are regarded, on balance, as predominantly speculative with respect to the issuer's capacity to pay interest and repay principal in accordance with the terms of the obligation. BB indicates the lowest degree of speculation among such bonds and CC the highest degree of speculation. Although such bonds will likely have some quality and protective characteristics, these are outweighed by large uncertainties or major risk exposures to adverse conditions.

C —A C rating is assigned to bonds that are currently highly vulnerable to nonpayment, have payment arrearages allowed by the terms of the documents, or bonds of an issuer that is the subject of a bankruptcy petition or similar action which have not experienced a payment default. The C rating may be assigned to bonds on which cash payments have been suspended in accordance with relevant terms of the instrument.

D —Bonds rated D are in payment default. The D rating category is used when payments on a bond are not made on the date due even if the applicable grace period has not expired, unless Standard & Poor's believes that such payments will be made during such grace period. The D rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on a bond are jeopardized.

Plus (+) or minus (-)

The ratings from AA to CCC may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.

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PART C

OTHER INFORMATION

Item 23. Exhibits

Exhibit

(a)		—Declaration of Trust of the Registrant.****

(b)		—Amended and Restated By-Laws of the Registrant. Filed herewith.

(c)		—Not Applicable.

(d)		—Investment Advisory Contract between the Registrant and Arnhold and S. Bleichroeder Advisers, LLC (“ASB Advisers’’).*

(e)(1)		—Distribution Agreement between the Registrant and ASB Securities LLC (“ASB Securities’’).*

(e)(2)		—Form of 12b-1 Servicing Agreement Between SGCS and A Life Insurance Company.*

(f)		—Not applicable.

(g)(1)		—Custody Agreement between the Registrant and State Street Bank and Trust Company.*****

(g)(2)		—Investment Accounting Agreement between the Registrant and State Street Bank and Trust Company.**

(g)(3)		—Amendment adding Registrant as a party to the Transfer Agency Agreement (“Master TA Agreement’’) between First Eagle Funds and DST Systems Inc.***

(g)(4)		—Special Custody Agreement between the Registrant and HSBC Bank USA.****

(g)(5)

—Amended and Restated Administration Agreement between the Registrant and State Street Bank and Trust Company. Filed herewith.

(h)		—Form of Participation Agreement among the Registrant, A Life Insurance Company and ASB Securities.****

(i)		—Not applicable.

(j)(1)

—Consent of PricewaterhouseCoopers LLP. Filed herewith.

(j)(2)

—Shearman & Sterling LLP Opinion with respect to Reorganization.******

(k)		—Not applicable.

(l)		—Investment Representation Letter of SGAM Corp.*

(m)		—Rule 12b-1 Distribution Plan and Agreement between the Registrant and ASB Securities.**

(n)		—Not applicable.

(p)

—Code of Ethics. Filed herewith.

*		Previously filed as an Exhibit to the Registration Statement.

**		Incorporated herein by reference to Post-Effective Amendment No. 8 filed on or about April 13, 2001.

***		Such amendment is incorporated herein by reference to Post-Effective Amendment No. 10 filed on or about April 15, 2003. The Master TA Agreement is incorporated herein by reference to Post-Effective Amendment No. 4 to the First Eagle Funds Registration Statement filed on or about July 25, 1997.

****		Incorporated herein by reference to Post-Effective Amendment No. 11 filed on or about April 15, 2004.

*****		Incorporated herein by reference to Post-Effective Amendment No. 14 filed on or about April 13, 2006.

******

Incorporated herein by reference to Post-Effective Amendment No. 15 filed on or about April 13, 2007.

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Item 24. Persons Controlled by or Under Common Control with Registrant

None.

Item 25. Indemnification

Article VII, Section 2 of the Registrant’s Declaration of Trust contains the following provision, generally providing for indemnification of Trustees, officers, employees and agents of the Registrant against judgments, fines, penalties, settlements and expenses to the fullest extent authorized, and in the manner permitted, by applicable federal and state law.

Indemnification and Limitation of Liability. A Trustee, when acting in such capacity, shall not be personally liable to any Person, other than the Trust or a Shareholder to the extent provided in this Article VII, for any act, omission or obligation of the Trust, of such Trustee or of any other Trustee. The Trustees shall not be responsible or liable in any event for any neglect or wrongdoing of any officer, agent, employee, Manager or Principal Underwriter of the Trust. The Trust (i) may indemnify an agent of the Trust or any Person who is serving or has served at the Trust’s request as an agent of another organization in which the Trust has any interest as a shareholder, creditor or otherwise and (ii) shall indemnify each Person who is, or has been, a Trustee, officer or employee of the Trust and any Person who is serving or has served at the Trust’s request as a d irector, officer, trustee, or employee of another organization in which the Trust has any interest as a shareholder, creditor or otherwise, in the case of (i) and (ii), to the fullest extent consistent with the 1940 Act and in the manner provided in the By-Laws; provided that such indemnification shall not be available to any of the foregoing Persons in connection with a claim, suit or other proceeding by any such Person against the Trust or a Series (or Class) thereof.

The Registrant also intends to maintain an investment company directors’ and officers’ errors and omissions insurance policy providing for additional protections for such persons in accord with industry practice.

Item 26. Business and Other Connections of Investment Adviser

ASB Advisers is the Registrant’s investment adviser. Its primary office is located at 1345 Avenue of the Americas, New York, New York, 10105. In addition to the Registrant, ASB Advisers acts as investment adviser to the First Eagle Funds, and to certain investment vehicles and accounts not subject to registration with the Securities and Exchange Commission.

ASB Advisers is a subsidiary of Arnhold and S. Bleichroeder Holdings, Inc. (“ASB Holdings’’), a privately-owned holding company organized under the laws of the State of New York, which has a substantial amount of assets under management in the form of individual accounts, and, through the Adviser, Fund accounts. In connection with another subsidiary, ASB Securities, LLC, a registered broker-dealer, and, through that company’s First Eagle Funds Distributors division, the principal underwriter to the Registrant, ASB Holdings is substantially involved in the distribution of mutual fund shares. The business and other connections of the Adviser’s directors and officers are as follows:

Name	Position with the Adviser	Business and Other Connections
Henry H. Arnhold	Director	Chairman of the Board of Arnhold and S. Bleichroeder Holdings, Inc.; Director, Aquila International Fund Limited; Trustee, The New School for Social Research; Director, Conservation International

John P. Arnhold	Chairman, CEO and Director	Co-President, Co-CEO and Director, Arnhold and S. Bleichroeder Holdings, Inc.; Chairman, CEO and Director, ASB Securities LLC; prior to March 2005, President and Director, Natexis Bleichroeder Inc. and Natexis Bleichroeder, UK; Director, Arnhold Ceramics; Director, The Arnhold Foundation; Director, The Mulago Foundation; Director, Hanseatic Asset Management LBG; Director, Quantum Endowment Fund; Director, Educational Broadcasting Corporation; Trustee, Trinity Episcopal Schools Corp.; Trustee, Vassar College; Trustee, Sports and Arts in Schools Foundation; Trustee, Jazz at Lincoln Center; Managing Member, New Eagle Management Company, LLC; President and Trustee, First Eagle Funds and First Eagle Variable Funds

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Name	Position with the Adviser	Business and Other Connections
Michael M. Kellen	Vice Chairman	Co-CEO and Director, Arnhold and S. Bleichroeder Holdings, Inc.; Director, Arnhold and S. Bleichroeder Advisers UK, Ltd.; Director, ASB Securities, LLC; Director, Arnhold Ceramics

Patrick A. Keenan	Chief Financial Officer	Chief Financial Officer, Arnhold and S. Bleichroeder Holdings, Inc. and ASB Securities LLC

Robert Miller	Senior Vice President and Director	Director, Arnhold and S. Bleichroeder, UK Ltd.

Mark D. Goldstein	General Counsel, Chief Compliance Officer, Senior Vice President and Secretary	General Counsel and Secretary, Arnhold and S. Bleichroeder Holdings, Inc.; Chief Compliance Officer, First Eagle Funds and First Eagle Variable Funds; Chief Compliance Officer, Good Hope Advisers, LLC from January 2006; Senior Counsel and Chief Compliance Officer, MacKay Shields LLC from April 2004; Senior Associate General Counsel, UBS Financial Services, Inc. from May 1998

Robert Bruno	Senior Vice President	President, ASB Securities LLC; Chief Operations Officer, First Eagle Funds and First Eagle Variable Funds

Item 27. Principal Underwriters

(a) The First Eagle Funds Distributors division of ASB Securities is the Registrant’s distributor (the “Distributor’’). It also serves as principal underwriter for First Eagle Funds.

(b) The positions and offices of the Distributor’s directors and officers who serve the Registrant are as follows:

Name and Business Address*	Position and Offices with Underwriter	Position and Offices with Registrant
John P. Arnhold	CEO, Chairman and Director	President and Trustee

Robert Bruno	President	Chief Operations Officer

Mark D. Goldstein	Secretary	Chief Compliance Officer

Patrick Keenan	Chief Financial Officer	None

Joseph Tropeano	Chief Compliance Officer	None

Suzan J. Afifi	Vice President	Secretary and Vice President

* The address of each person named above is 1345 Avenue of the Americas, New York, New York 10105.

Item 28. Location of Accounts and Records

All accounts, books and other documents required to be maintained by Section 31(a) of the Investment Company Act of 1940 and the Rules promulgated thereunder are maintained at the offices of the Registrant, 1345 Avenue of the Americas, New York, NY 10105 with the exception of certain accounts, books and other documents which are kept by the Registrant’s custodian, State Street Bank

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and Trust Company, 801 Pennsylvania Avenue, Kansas City, Missouri 64105 and registrar and shareholder servicing agent, DST Systems, Inc., P.O. Box 419324, Kansas City, Missouri 64141-6324.

Item 29. Management Services

Not applicable.

Item 30. Undertakings

The Registrant undertakes to call a meeting of shareholders for the purpose of voting upon the question of removal of a director, if requested to do so by the holders of at least 10% of a Fund’s outstanding shares, and that it will assist communication with other shareholders as required by Section 16(c) of the Investment Company Act of 1940.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has duly caused this Post-Effective Amendment to its Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York and State of New York, as of the 15th day of April, 2009.

	F IRST EAGLE VARIABLE FUNDS

	By:	*
		John P. Arnhold, President

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective Amendment to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.

Signature	Capacity	Date

*	Trustee	April 15, 2009
(Lisa Anderson)

*	Trustee	April 15, 2009
(John P. Arnhold)

*	Trustee	April 15, 2009
(Candace K. Beinecke)

*	Trustee	April 15, 2009
(Jean-Marie Eveillard)

*	Trustee	April 15, 2009
(Jean D. Hamilton)

*	Trustee	April 15, 2009
(James E. Jordan)

*	Trustee	April 15, 2009
(William M. Kelly)

*	Trustee	April 15, 2009
(Paul J. Lawler)

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Signature	Capacity	Date

/ S/ ROBERT BRUNO	Chief Operations Officer	April 15, 2009
(Robert Bruno)

*By:	/ S/ ROBERT BRUNO
	Robert Bruno Power-of-Attorney

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EXHIBIT INDEX

(b) Amended and Restated By-Laws of the Registrant.

(g)(5) Amended and Restated Administration Agreement between the Registrant and State Street Bank and Trust Company.

(j) (1) Consent of PricewaterhouseCoopers LLP

(p) Code of Ethics

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Exhibit 99.(b)

AMENDED AND RESTATED

BY-LAWS

FIRST EAGLE VARIABLE FUNDS

A Delaware Statutory Trust

INTRODUCTION

A. Agreement and Declaration of Trust . These By-Laws shall be subject to the Agreement and Declaration of Trust, as from time to time in effect (the “Declaration of Trust”), of First Eagle Variable Funds, a Delaware statutory trust (the “Trust”). In the event of any inconsistency between the terms hereof and the terms of the Declaration of Trust, the terms of the Declaration of Trust shall control.

B. Definitions . Capitalized terms used herein and not herein defined are used as defined in the Declaration of Trust.

ARTICLE I

Offices

Section 1. Principal Office . The Trustees shall fix and, from time to time, may change the location of the principal executive office of the Trust at any place within or outside the State of Delaware.

Section 2. Delaware Office . The Trustees shall establish a registered office in the State of Delaware and shall appoint as the Trust’s registered agent for service of process in the State of Delaware an individual resident of the State of Delaware or a Delaware corporation or a corporation authorized to transact business in the State of Delaware; in each case the business office of such registered agent for service of process shall be identical with the registered Delaware office of the Trust.

Section 3. Other Offices . The Trustees may at any time establish branch or subordinate offices at any place or places where the Trust intends to do business.

ARTICLE II

Meetings of Shareholders

Section 1. Place of Meetings . Meetings of Shareholders shall be held at any place designated by the Trustees. In the absence of any such designation, Shareholders’ meetings shall be held at the principal executive office of the Trust.

Section 2. Call of Meetings . Meetings of the Shareholders may be called at any time by the Trustees or by the President for the purpose of taking action upon any matter

requiring the vote or authority of the Shareholders as herein provided or provided in the Declaration of Trust or upon any other matter as to which such vote or authority is deemed by the Trustees or the President to be necessary or desirable. To the extent required by the 1940 Act, meetings of the Shareholders for the purpose of voting on the removal of any Trustee shall be called promptly by the Trustees upon the written request of Shareholders holding at least ten percent (10%) of the outstanding Shares entitled to vote.

Section 3. Notice of Meetings of Shareholders . All notices of meetings of Shareholders shall be sent or otherwise given in accordance with Section 4 of this Article II not less than ten (10) nor more than ninety (90) days before the date of the meeting. The notice shall specify (i) the place, date and hour of the meeting, and (ii) the general nature of the business to be transacted. The notice of any meeting at which Trustees are to be elected also shall include the name of any nominee or nominees whom at the time of the notice are intended to be presented for election.

If action is proposed to be taken at any meeting for approval of (i) a contract or transaction in which a Trustee has a direct or indirect financial interest, (ii) an amendment of the Agreement and Declaration of Trust of the Trust, (iii) a reorganization of the Trust, or (iv) a voluntary dissolution of the Trust, the notice shall also state the general nature of that proposal.

Section 4. Manner of Giving Notice; Affidavit of Notice . Notice of any meeting of Shareholders shall be given either personally or by first-class mail or telegraphic or other written communication, charges prepaid, addressed to the Shareholder at the address appearing on the books of the Trust or its transfer agent or given by the Shareholder to the Trust for the purpose of notice. If no such address appears on the Trust’s books or is given, notice shall be deemed to have been given if sent to the Shareholder by first-class mail or telegraphic or other written communication to the Trust’s principal executive office, or if published at least once in a newspaper of general circulation in the county where that office is located. Notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by telegram or other means of written communication or, where notice is given by publication, on the date of publication.

If any notice addressed to a Shareholder at the address appearing on the books of the Trust is returned to the Trust by the United States Postal Service marked to indicate that the Postal Service is unable to deliver the notice to the Shareholder at that address, all future notices or reports shall be deemed to have been duly given without further mailing if available to the Shareholder on written demand of the Shareholder to the Trust.

An affidavit of the mailing or other means of giving any notice of any meeting of Shareholders shall be filed and maintained in the minute book of the Trust.

Section 5. Adjourned Meeting; Notice . Any meeting of Shareholders, whether or not a quorum is present, may be adjourned from time to time by the vote of the majority of the Shares represented at that meeting, either in person or by proxy.

When any meeting of Shareholders is adjourned to another time or place, notice need not be given of the adjourned meeting at which the adjournment is taken, unless a new

record date of the adjourned meeting is fixed or unless the adjournment is for more than sixty (60) days from the date set for the original meeting in which case the Trustees shall set a new record date. If notice of any such adjourned meeting is required, notice shall be given to each Shareholder of record entitled to vote at the adjourned meeting in accordance with the provisions of Sections 3 and 4 of this Article II. At any adjourned meeting, the Trust may transact any business which might have been transacted at the original meeting.

Section 6. Voting . The Shareholders entitled to vote at any meeting of Shareholders shall be determined in accordance with the provisions of the Declaration of Trust of the Trust, as in effect at such time. The Shareholders’ vote may be by voice vote or by ballot, provided, however, that any election for Trustees must be by ballot if demanded by any Shareholder before the voting has begun. On any matter other than elections of Trustees, any Shareholder may vote part of the Shares in favor of the proposal and refrain from voting the remaining Shares or vote them against the proposal, but if the Shareholder fails to specify the number of Shares which the Shareholder is voting affirmatively, it will be conclusively presumed that the Shareholder’s approving vote is with respect to the total Shares that the Shareholder is entitled to vote on such proposal.

Section 7. Waiver of Notice by Consent of Absent Shareholders . The actions taken at a meeting of Shareholders, however called and noticed and wherever held, shall be as valid as though taken at a meeting duly held after regular call and notice if a quorum is present, either in person or by proxy, and if either before or after the meeting, a majority of the persons entitled to vote were present in person or by proxy or signed a written waiver of notice or a consent to a holding of the meeting or an approval of the minutes. The waiver of notice or consent need not specify either the business to be transacted or the purpose of any meeting of Shareholders.

Attendance by a person at a meeting shall also constitute a waiver of notice of that meeting, except when the person objects at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened and except that attendance at a meeting is not a waiver of any right to object to the consideration of matters not included in the notice of the meeting if that objection is expressly made at the beginning of the meeting.

Section 8. Shareholder Action by Written Consent Without a Meeting . Except as provided in the Declaration of Trust or the 1940 Act, any action that may be taken at any meeting of Shareholders may be taken without a meeting and without prior notice if a consent in writing setting forth the action so taken is signed by Shareholders having not less than the minimum number of votes that would be necessary to authorize or take that action at a meeting at which all Shareholders entitled to vote on that action were present and voted. All such consents shall be filed with the Secretary of the Trust and shall be maintained in the Trust’s records. Any Shareholder giving a written consent or a transferee of the Shares or a personal representative of the Shareholder or their respective proxy holders may revoke the consent by a writing received by the Secretary of the Trust before written consents of the number of votes required to authorize the proposed action have been filed with the Secretary.

If the consents of all Shareholders entitled to vote have not been solicited in writing and if the unanimous written consent of all such Shareholders shall not have been

received, the Secretary shall give prompt notice of the action approved by the Shareholders without a meeting. This notice shall be given in the manner specified in Section 4 of this Article II.

Section 9. Record Date for Shareholder Notice, Voting and Giving Consents .

(a) For purposes of determining the Shareholders entitled to vote or act at any meeting or adjournment thereof, the Trustees may fix in advance a record date which shall not be more than ninety (90) days nor less than ten (10) days before the date of any such meeting. Without fixing a record date for a meeting, the Trustees may for voting and notice purposes close the register or transfer books for one or more Series (or Classes) for all or any part of the period between the earliest date on which a record date for such meeting could be set in accordance herewith and the date of such meeting.

If the Trustees do not so fix a record date or close the register or transfer books of the affected Series (or Classes), the record date for determining Shareholders entitled to notice of or to vote at a meeting of Shareholders shall be at the close of business on the business day next preceding the day on which notice is given or if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held.

(b) The record date for determining Shareholders entitled to give consent to action in writing without a meeting, (i) when no prior action of the Trustees has been taken, shall be the day on which the first written consent is given, or (ii) when prior action of the Trustees has been taken, shall be such date as determined for that purpose by the Trustees, or if no record date is fixed by the Trustees, the record date shall be the close of business on the day on which the Trustees adopt the resolution. Nothing in this Section 9 of Article II shall be construed as precluding the Trustees from setting different record dates for different Series (or Classes).

(c) Only Shareholders of record on the record date as herein determined shall have any right to vote or to act at any meeting or give consent to any action relating to such record date, notwithstanding any transfer of Shares on the books of the Trust after such record date.

Section 10. Proxies . Subject to the provisions of the Declaration of Trust, every Person entitled to vote for Trustees or on any other matter shall have the right to do so either in person or by proxy, provided that either (i) an instrument authorizing such a proxy to act is executed by the Shareholder in writing and dated not more than eleven (11) months before the meeting, unless the instrument specifically provides for a longer period or (ii) an electronic, telephonic, computerized or other alternative to execution of a written instrument authorizing the proxy to act which authorization is received not more than eleven (11) months before the meeting. A proxy shall be deemed executed by a Shareholder if the Shareholder’s name is placed on the proxy (whether by manual signature, typewriting, telegraphic transmission or otherwise) by the Shareholder or the Shareholder’s attorney-in-fact or other authorized agent. A valid proxy which does not state that it is irrevocable shall continue in full force and effect unless revoked before the vote pursuant to that proxy by a written notice of revocation of the proxy by the person who executed it delivered to the Trust; by a subsequent proxy executed by, or attendance at the meeting and voting in person by, the person executing that proxy; by such

person using any electronic, telephonic, computerized or other alternative means authorized by the Trustees for authorizing the proxy to act; or by a written notice to the Trust of the death or incapacity of the maker of that proxy. A proxy with respect to Shares held in the name of two or more Persons shall be valid if executed by any one of them unless at or prior to exercise of the proxy the Trust receives a specific written notice to the contrary from any of them. A proxy purporting to be executed by or on behalf of a Shareholder shall be deemed valid unless challenged at or prior to its exercise and the burden of proving invalidity shall rest on the challenger.

Section 11. Inspectors of Election . Before any meeting of Shareholders, the Trustees may appoint any person(s) other than nominees for office to act as inspector(s) of election at the meeting or its adjournment. If no inspector(s) of election are so appointed, the Chair of the meeting may appoint inspector(s) of election at the meeting. If any person appointed as an inspector fails to appear or fails or refuses to act, the Chair of the meeting may appoint a person to fill the vacancy.

The inspector(s) shall:

(a) Determine the number of Shares outstanding and the voting power of each, the Shares represented at the meeting, the existence of a quorum and the authenticity, validity and effect of proxies;

(b) Receive votes, ballots or consents;

(d) Count and tabulate all votes or consents;

(e) Determine when the polls shall close;

(f) Determine the result; and

(g) Do any other acts that may be proper to conduct the election or vote with fairness to all Shareholders.

ARTICLE III

Trustees

Section 1. Powers . Subject to the applicable provisions of the 1940 Act, the Declaration of Trust and these By-Laws relating to action required to be approved by the Shareholders, the business and affairs of the Trust shall be managed and all powers shall be exercised by or under the direction of the Trustees.

Section 2. Number of Trustees . The exact number of Trustees within any limits specified in the Declaration of Trust shall be fixed from time to time by a resolution of the Trustees.

Section 3. Vacancies . Vacancies in the authorized number of Trustees may be filled as provided in the Declaration of Trust.

Section 4. Place of Meetings and Meetings by Telephone . All meetings of the Trustees may be held at any place that has been designated in the notice for such meeting or as designated by the Trustees. In the absence of such a designation, regular meetings shall be held at the principal executive office of the Trust. Except as provided under the 1940 Act, any regular or special meeting may be held by conference telephone or similar communication equipment, so long as all Trustees participating in the meeting can hear one another, and all such Trustees shall be deemed to be present in person at such meeting.

Section 5. Regular Meetings . Regular meetings of the Trustees shall be held without call at such time as shall from time to time be fixed by the Trustees. Such regular meetings may be held without notice.

Section 6. Special Meetings . Special meetings of the Trustees for any purpose or purposes may be called at any time by the President or any Vice President or the Secretary or any two (2) Trustees.

Notice of the time and place of special meetings shall be delivered personally or by telephone to each Trustee or sent by first-class mail, by telegram or telecopy (or similar electronic means) or by nationally recognized overnight courier, charges prepaid, addressed to each Trustee at that Trustee’s address as it is shown on the records of the Trust. In case the notice is mailed, it shall be deposited in the United States mail at least seven (7) calendar days before the time of the holding of the meeting. In case the notice is delivered personally or by telephone or by telegram, telecopy (or similar electronic means) or overnight courier, it shall be given at least twenty-four (24) hours before the time of the holding of the meeting. Any oral notice given personally or by telephone may be communicated either to the Trustee or to a person at the office of the Trustee who the person giving the notice has reason to believe will promptly communicate it to the Trustee. The notice need not specify the purpose of the meeting or the place if the meeting is to be held at the principal executive office of the Trust.

Section 7. Quorum . A third of the authorized number of Trustees shall constitute a quorum for the transaction of business, except to adjourn as provided in Section 9 of this Article III. Every act or decision done or made by a majority of the Trustees present at a meeting duly held at which a quorum is present shall be regarded as the act of the Trustees, subject to the provisions of the Declaration of Trust. A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of Trustees if any action taken is approved by at least a majority of the required quorum for that meeting.

Section 8. Waiver of Notice . Notice of any meeting need not be given to any Trustee who either before or after the meeting signs a written waiver of notice, a consent to holding the meeting, or approves the minutes of the meeting. The waiver of notice or consent need not specify the purpose of the meeting. All such waivers, consents or approvals shall be filed with the records of the Trust or made a part of the minutes of the meeting. Notice of a meeting shall also be deemed given to any Trustee who attends the meeting without protesting before or at its commencement the lack of notice to that Trustee.

Section 9. Adjournment . A majority of the Trustees present, whether or not constituting a quorum, may adjourn any meeting to another time and place.

Section 10. Notice of Adjournment . Notice of the time and place of holding an adjourned meeting need not be given unless the meeting is adjourned for more than forty-eight (48) hours, in which case notice of the time and place shall be given before the time of the adjourned meeting in the manner specified in Section 6 of this Article III.

Section 11. Action Without a Meeting . Unless the 1940 Act requires that a particular action be taken only at a meeting at which the Trustees are present in person, any action to be taken by the Trustees at a meeting may be taken without such meeting by the written consent of a majority of the Trustees then in office. Any such written consent may be executed and given by telecopy or similar electronic means. Such written consents shall be filed with the minutes of the proceedings of the Trustees. If any action is so taken by the Trustees by the written consent of less than all of the Trustees, prompt notice of the taking of such action shall be furnished to each Trustee who did not execute such written consent, provided that the effectiveness of such action shall not be impaired by any delay or failure to furnish such notice.

Section 12. Fees and Compensation of Trustees . Trustees and members of committees may receive such compensation, if any, for their services and such reimbursement of expenses as may be fixed or determined by resolution of the Trustees. This Section 12 shall not be construed to preclude any Trustee from serving the Trust in any other capacity as an officer, agent, employee, or otherwise and receiving compensation for those services.

Section 13. Delegation of Power to Other Trustees . Any Trustee may, by power of attorney, delegate his or her power for a period not exceeding six (6) months at any one time to any other Trustee or Trustees; provided that in no case shall fewer than two (2) Trustees personally exercise the powers granted to the Trustees, except as otherwise expressly provided herein or by resolution of the Trustees. Except where applicable law may require a Trustee to be present in person, a Trustee represented by another Trustee pursuant to such power of attorney shall be deemed to be present for purposes of establishing a quorum and satisfying the required vote of Trustees.

ARTICLE IV

Committees

Section 1. Committees of Trustees . The Trustees may by resolution designate one or more committees, each consisting of two (2) or more Trustees, to serve at the pleasure of the Trustees. The Trustees may designate one or more Trustees as alternate members of any committee who may replace any absent member at any meeting of the committee. Any committee to the extent provided in the resolution of the Trustee, shall have the authority of the Trustees, except with respect to:

(a) the approval of any action which under applicable law requires approval by a majority of the entire authorized number of Trustees or certain Trustees;

(b) the filling of vacancies of Trustees;

(d) the amendment or termination of the Declaration of Trust or any Series or Class or amendment of the By-Laws or the adoption of new By-Laws;

(e) the amendment or repeal of any resolution of the Trustees which by its express terms is not so amendable or repealable;

(f) a distribution to the Shareholders of the Trust, except at a rate or in a periodic amount or within a designated range determined by the Trustees; or

(g) the appointment of any other committees of the Trustees or the members of such new committees.

Section 2. Meetings and Action of Committees . Meetings and action of committees shall be governed by and held and taken in accordance with the provisions of Article III of these By-Laws, with such changes in the context thereof as are necessary to substitute the committee and its members for the Trustees generally, except that the time of regular meetings of committees may be determined either by resolution of the Trustees or by resolution of the committee. Special meetings of committees may also be called by resolution of the Trustees. Alternate members shall be given notice of meetings of committees and shall have the right to attend all meetings of committees. The Trustees may adopt rules for the governance of any committee not inconsistent with the provisions of these By-Laws.

ARTICLE V

Officers

Section 1. Officers . The officers of the Trust shall be a President, a Chief Operations Officer, a Chief Financial Officer, a Chief Compliance Officer and a Secretary. The Trust may also have, at the discretion of the Trustees, a Chairperson of the Board (Chair), one or more Vice Presidents (including Senior, Executive and/or Assistant Vice Presidents), one or more Assistant Secretaries, a Treasurer, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 3 of this Article V. Any number of offices may be held by the same person; additionally, any office other than that of the President or the Chair may be held by more than one person (with the relevant authority and duties of the office divided between or among such persons in a manner consented to by the President or Chair). The Chair, if there be one, shall be a Trustee and may but need not be a Shareholder; and any other officer may but need not be a Trustee or Shareholder.

Section 2. Election of Officers . The officers of the Trust, except such officers as may be appointed in accordance with the provisions of Section 3 or Section 5 of this Article V, shall be chosen by the Trustees, and each shall serve at the pleasure of the Trustees, subject to the rights, if any, of an officer under any contract of employment.

Section 3. Subordinate Officers . The Trustees may appoint and may empower the President to appoint such other officers as the business of the Trust may require, each of

whom shall hold office for such period, have such authority and perform such duties as are provided in these By-Laws or as the Trustees may from time to time determine.

Section 4. Removal and Resignation of Officers . Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the Trustees at any regular or special meeting of the Trustees or by the principal executive officer or by such other officer upon whom such power of removal may be conferred by the Trustees.

Any officer may resign at any time by giving written notice to the Trust. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice; and unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the Trust under any contract to which the officer is a party.

Section 5. Vacancies in Offices . A vacancy in any office because of death, resignation, removal, disqualification or other cause shall be filled in the manner prescribed in these By-Laws for regular appointment to that office. The President (or the Chair in his or her absence) may make temporary appointments to a vacant office pending action by the Trustees.

Section 6. Chair . The Chair, if such person is elected, shall, if present, preside at meetings of the Trustees, shall function as the lead Trustee and shall exercise and perform such other powers and duties as may be from time to time assigned to him or her by the Trustees or prescribed by the Declaration of Trust or these By-Laws.

Section 7. President . Subject to such supervisory powers, if any, as may be given by the Trustees to the Chair, if there be such an officer, the President shall be the chief executive officer of the Trust and shall, subject to the control of the Trustees and the Chair, have general supervision, direction and control of the business and the officers of the Trust. He or she shall preside at all meetings of the Shareholders (or, if not present, appoint a delegate to do so), and in the absence of the Chair or if there be none, at all meetings of the Trustees. He or she shall have the general powers and duties of management usually vested in the office of President of a corporation and shall have such other powers and duties as may be prescribed by the Trustees (collectively or by the Chair), the Declaration of Trust or these By-Laws. The Board may appoint Co-Presidents, each of which shall have the power of the President.

Section 8. Chief Operations Officer . Subject to the supervision and control of the President, the Chief Operations Officer of the Trust shall have supervisory authority with respect to the functions and duties of all officers of the Trust other than the Chair, the President and the Chief Compliance Officer and shall have general supervision, direction and control of the operating affairs of the Trust. In the absence or disability of the President, the Secretary, the Chief Financial Officer or the Treasurer, the Chief Operations Officer shall perform all the duties of any such officer (or more than one such officer as the case may be) and when so acting shall have all powers of and be subject to all the restrictions upon such officer(s). The Chief Operations Officer also shall be charged with the supervision of the Chief Financial Officer and any other officer having powers or duties in respect of planning and directing ledger accounts, financial statements, accounting and cost control systems the proper deposit of monies and other

valuables in the name and to the credit of the Trust. He or she shall have the general powers and duties of management usually vested in the office of the chief operations officer of a corporation and shall have other powers and perform such other duties as may be prescribed by the Trustees (collectively or by the Chair), the President or by these By-Laws.

Section 9. Chief Compliance Officer . Subject to the supervision and control of the Trustees, the Chief Compliance Officer of the Trust shall be responsible for the design, oversight and periodic review of the Trust’s procedures for compliance with applicable Federal securities laws. The designation, compensation and removal of the Chief Compliance Officer shall be subject to approval by the Trustees as contemplated by Rule 38a-1 under the Investment Company Act of 1940. The Chief Compliance Officer shall have other powers and perform such other duties as may be prescribed by the Trustees (collectively or by the Chair), the President or by these By-Laws.

Section 10. Chief Financial Officer . Subject to the supervision and control of the Chief Operations Officer, the Chief Financial Officer shall be the chief financial and accounting officer of the Trust, shall oversee all aspects of the Trust’s financial controls and accounting function and also shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the Trust and each Series and Class thereof, including accounts of the assets, liabilities, receipts, disbursements, gains, losses, capital and retained earnings of all Series and Classes thereof. The books of account shall at all reasonable times be open to inspection by any Trustee. The Chief Financial Officer also shall have responsibility to assure the proper implementation of financial controls and full compliance with all financial control and reporting requirements of the Sarbanes-Oxley Act of 2002 and shall be responsible for planning and directing ledger accounts, financial statements and accounting and cost control systems and shall deposit all monies and other valuables in the name and to the credit of the Trust with such depositaries as may be designated by the Board of Trustees. He or she shall disburse the funds of the Trust as may be ordered by the Trustees, shall render to the Chief Operations Officer, the President and/or the Trustees, whenever each may request it, an account of the Trust’s financial condition or of its ledger and deposits. He or she shall have the general powers and duties of management usually vested in the office of the chief financial officer of a corporation (and as such shall fulfill the function of “principal financial officer” under the Sarbanes-Oxley Act of 2002) and shall have other powers and perform such other duties as may be prescribed by the Trustees (collectively or by the Chair), the President or by these By-Laws.

Section 11. Vice Presidents . The Vice Presidents (which may include Senior, Executive and/or Assistant Vice Presidents) shall have such powers and perform such duties as from time to time may be prescribed for them respectively by the Trustees (collectively or by the Chair), the President, the Chief Operations Officer or by these By-Laws. In the absence or disability of both the President and Chief Operations Officer, the Chair or the Trustees shall designate one or more of the Vice Presidents to perform all the duties of each such officer and when so acting shall have all powers of and be subject to all the restrictions upon such officer.

Section 12. Secretary . The Secretary shall keep or cause to be kept at the principal executive office of the Trust or such other place as the Trustees may direct a book of minutes of all meetings and actions of Trustees, committees of Trustees and Shareholders with

the time and place of holding, whether regular or special, and if special, how authorized, the notice given, the names of those present at Trustees’ meetings or committee meetings, the number of Shares present or represented at meetings of Shareholders and the proceedings.

The Secretary shall keep or cause to be kept at the principal executive office of the Trust or at the office of the Trust’s transfer agent or registrar, a Share register or a duplicate Share register showing the names of all Shareholders and their addresses, the number and classes of Shares held by each Shareholder.

The Secretary shall give or cause to be given notice of all meeting of the Shareholders required to be given by these By-Laws or by applicable law and shall have such other powers and perform such other duties as may be prescribed by the Trustees (collectively or by the Chair), the President, the Chief Operations Officer or by these By-Laws.

Section 13. Treasurer . The Treasurer (if such person shall be elected) shall support the Chief Financial Officer in any aspect of the Chief Financial Officer’s duties relating to the Trust’s financial controls and accounting function as the Chief Financial Officer, in consultation with the Chief Operating Officer, deems desirable or appropriate. When authorized by the Chief Financial Officer, whether pursuant to special or standing instructions, the Treasurer shall disburse the funds of the Trust and maintain appropriate accounts thereof in the Trust’s ledger. The Treasurer also shall have other powers and perform such other duties as may be prescribed by the Trustees (collectively or by the Chair), the President, the Chief Financial Officer or by these By-Laws. If there should not be a Chief Financial Officer, all references to that officer in this paragraph shall be understood instead to be references to the Chief Operations Officer; also in such circumstances, the Chief Operations Officer may designate the Treasurer to fulfill the function of “principal financial officer” under the Sarbanes-Oxley Act of 2002.

ARTICLE VI

Indemnification of Trustees, Officers,

Employees and Other Agents

Section 1. Agents, Proceedings, Expenses . For the purpose of this Article, “agent” means any person who is or was a Trustee, officer, employee or other agent of the Trust or is or was serving at the request of the Trust as a trustee, director, officer, employee or agent of another organization in which the Trust has any interest as a Shareholder, creditor or otherwise: “proceeding” means any threatened, pending or completed claim, action, suit or proceeding, whether civil, criminal, administrative or investigative (including appeals); and “expenses” includes, without limitation, attorneys’ fees, costs, judgments, amounts paid in settlement, fines, penalties and all other liabilities whatsoever.

Section 2. Indemnification . Subject to the exceptions and limitations contained in Section 3 below, every agent shall be indemnified by the Trust to the fullest extent permitted by law against all liabilities and against all expenses reasonably incurred or paid by him or her in connection with any proceeding in which he or she becomes involved as a party or otherwise by virtue of his or her being or having been an agent.

Section 3. Limitations, Settlements . No indemnification shall be provided hereunder to an agent:

(a) who shall have been adjudicated by the court or other body before which the proceeding was brought to be liable to the Trust or its Shareholders by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office (collectively, “disabling conduct”); or

(b) with respect to any proceeding disposed of (whether by settlement, pursuant to a consent decree or otherwise) without an adjudication by the court or other body before which the proceeding was brought that such agent was liable to the Trust or its Shareholders by reason of disabling conduct, unless there has been a determination that such agent did not engage in disabling conduct:

(i) by the court or other body before which the proceeding was brought;

(ii) by at least a majority of those Trustees who are neither Interested Persons (within the meaning of the 1940 Act) of the Trust nor are parties to the proceeding based upon a review of readily available facts (as opposed to a full trial-type inquiry); or

(iii) by written opinion of independent legal counsel based upon a review of readily available facts (as opposed to a full trial-type inquiry);

provided, however, that indemnification shall be provided hereunder to an agent with respect to any proceeding in the event of (1) a final decision on the merits by the court or other body before which the proceeding was brought that the agent was not liable by reason of disabling conduct, or (2) the dismissal of the proceeding by the court or other body before which it was brought for insufficiency of evidence of any disabling conduct with which such agent has been charged.

Section 4. Insurance, Rights Not Exclusive . The rights of indemnification herein provided may be insured against by policies maintained by the Trust on behalf of any agent, shall be severable, shall not be exclusive of or affect any other rights to which any agent may now or hereafter be entitled and shall inure to the benefit of the heirs, executors and administrators of any agent.

Section 5. Advance of Expenses . Expenses incurred by an agent in connection with the preparation and presentation of a defense to any proceeding may be paid by the Trust from time to time prior to final disposition thereof upon receipt of an undertaking by or on behalf of such agent that such amount will be paid over by him or her to the Trust if it is ultimately determined that he or she is not entitled to indemnification under this Article VI; provided, however, that (a) such agent shall have provided appropriate security for such undertaking, (b) the Trust is insured against losses arising out of any such advance payments or (c) either a majority of the Trustees who are neither Interested Persons of the Trust nor parties to the proceeding, or independent legal counsel in a written opinion, shall have determined, based upon a review of readily available facts (as opposed to a trial-type inquiry or full investigation), that there is reason to believe that such agent will be found entitled to indemnification under this Article VI.

Section 6. Fiduciaries of Employee Benefit Plan . This Article does not apply to any proceeding against any Trustee, investment manager or other fiduciary of an employee benefit plan in that person’s capacity as such, even though that person may also be an agent of this Trust as defined in Section 1 of this Article. Nothing contained in this Article shall limit any right to indemnification to which such a Trustee, investment manager, or other fiduciary may be entitled by contract or otherwise which shall be enforceable to the extent permitted by applicable law other than this Article.

ARTICLE VII

Records and Reports

Section 1. Maintenance and Inspection of Share Registrar . The Trust shall maintain at its principal executive office or at the office of its transfer agent or registrar, if either be appointed and as determined by resolution of the Trustees, a record of its Shareholders, giving the names and addresses of all Shareholders and the number and Series (and, as applicable, Class) of Shares held by each Shareholder, and the number and date of certificates issued for the same and the number and date of cancellation of every certificate surrendered for cancellation. Subject to such reasonable standards (including standards governing what information and documents are to be furnished and at whose expense) as may be established by the Trustees from time to time, the record of the Trust’s Shareholders shall be open to inspection upon the written request of any Shareholder at any reasonable time during usual business hours for a purpose reasonably related to the holder’s interests as a Shareholder.

Section 2. Maintenance and Inspection of By-Laws . The Trust shall keep at its principal executive office the original or a copy of these By-Laws as amended to date, which shall be open to inspection by the Shareholders at all reasonable times during office hours.

Section 3. Maintenance and Inspection of Other Records . The accounting books and records and minutes of proceedings of the Shareholders and the Trustees and any committee or committees of the Trustees shall be kept at such place or places designated by the Trustees or in the absence of such designation, at the principal executive office of the Trust. The minutes shall be kept in written form and the accounting books and records shall be kept either in written form or in any other form capable of being converted into written form. Minute books shall be open to inspection upon the written request of any Shareholder at reasonable times during usual business hours for a purpose reasonably related to the Shareholder’s interests as a Shareholder. Any such inspection may be made in person or by an agent and shall include the right to copy. Notwithstanding the foregoing, the Trustees shall have the right to keep confidential from Shareholders for such period of time as the Trustees deem reasonable, any information which the Trustees reasonably believe to be in the nature of trade secrets or other information the disclosure of which the Trustees in good faith believe is not in the best interests of the Trust or could damage the Trust or its business or which the Trust is required by law or by agreement with a third party to keep confidential.

Section 4. Inspection by Trustees . Every Trustee shall have the absolute right at any reasonable time to inspect all books, records, and documents of every kind and the physical

properties of the Trust. This inspection by a Trustee may be made in person or by an agent or attorney and the right of inspection includes the right to copy and make extracts of documents.

Section 5 . Financial Statements . A copy of any financial statements and any income statement of the Trust for each semi-annual period of each fiscal year and accompanying balance sheet of the Trust as of the end of each such period that has been prepared by the Trust shall be kept on file in the principal executive office of the Trust for at least twelve (12) months and each such statement shall be exhibited at all reasonable times to any Shareholder demanding an examination of any such statement or a copy shall be mailed to any such Shareholder.

The semi-annual income statements and balance sheets referred to in this section shall be accompanied by the report, if any, of any independent accountants engaged by the Trust or the certificate of an authorized officer of the Trust that the financial statements were prepared without audit from the books and records of the Trust.

ARTICLE VIII

General Matters

Section 1. Checks, Drafts, Evidence of Indebtedness . All checks, drafts, or other orders for payment of money, notes or other evidences of indebtedness issued in the name of or payable to the Trust shall be signed or endorsed in such manner and by such person or persons as shall be designated from time to time in accordance with the resolution of the Board of Trustees.

Section 2. Contracts and Instruments; How Executed . The Trustees, except as otherwise provided in these By-Laws, may authorize any officer or officers, agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Trust and this authority may be general or confined to specific instances; and unless so authorized or ratified by the Trustees or within the agency power of an officer, no officer, agent, or employee shall have any power or authority to bind the Trust by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

Section 3. Certificates for Shares . The Trustees may at any time authorize the issuance of Share certificates for any one or more Series or Classes. In that event, each Shareholder of an affected Series or Class shall be entitled upon request to receive a certificate evidencing such Shareholder’s ownership of Shares of the relevant Series or Class (in such form as shall be prescribed from time to time by the Trustees). All certificates shall be signed in the name of the Trust by the President or Vice President and by the Treasurer or an Assistant Treasurer or the Secretary or any Assistant Secretary, certifying the number of Shares and the Series of Shares owned by the Shareholders. Any or all of the signatures on the certificate may be facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed on a certificate shall have ceased to be that officer, transfer agent, or registrar before that certificate is issued, it may be issued by the Trust with the same effect as if that person were an officer, transfer agent or registrar at the date of issue. Notwithstanding the foregoing, the Trust may adopt and use a system of issuance, recordation and transfer of its Shares by electronic or other means.

Section 4. Lost Certificates . Except as provided in this Section 4, no new certificates for Shares shall be issued to replace an old certificate unless the latter is surrendered to the Trust and canceled at the same time. The Trustees may, in the event any Share certificate or certificate for any other security is lost, stolen, or destroyed, authorize the issuance of a replacement certificate on such terms and conditions as the Trustees may require, including a provision for indemnification of the Trust secured by a bond or other adequate security sufficient to protect the Trust against any claim that may be made against it, including any expense or liability on account of the alleged loss, theft, or destruction of the certificate or the issuance of the replacement certificate.

Section 5. Representation of Shares of Other Entities held by Trust . The President or any Vice President or any other person authorized by the Trustees or by any of the foregoing designated officers, is authorized to vote or represent on behalf of the Trust any and all Shares of any corporation, partnership, trusts, or other entities, foreign or domestic, standing in the name of the Trust. The authority granted may be exercised in person or by a proxy duly executed by such designated person.

Section 6. Fiscal Year . The fiscal year of the Trust shall be fixed and refixed or changed from time to time by the Trustees. The fiscal year of the Trust shall be the taxable year of each Series and Class of the Trust.

Section 7. Seal . The seal of the Trust, if utilized, shall consist of the words “First Eagle Variable Funds — Delaware” in a circle. However, the seal shall not be necessary to be placed on, and its absence shall not impair the validity of, any document, instrument or other paper executed and delivered by or on behalf of the Trust.

ARTICLE IX

Amendments

Section 1. Amendment . Except as otherwise provided by applicable law or by the Declaration of Trust, these By-Laws may be restated, amended, supplemented or repealed by the Trustees, provided that no restatement, amendment, supplement or repeal hereof shall limit the rights to indemnification or insurance provided in Article VI hereof with respect to any acts or omissions of agents (as defined in Article VI) of the Trust prior to such amendment.

Section 2. Incorporation by Reference into Agreement and Declaration of Trust by the Trust . These By-Laws and any amendments thereto shall be deemed incorporated by reference in the Declaration of Trust.

Exhibit 99.(g)(5)

AMENDED AND RESTATED ADMINISTRATION AGREEMENT

This Amended and Restated Administration Agreement (“Agreement”) dated and effective as of April 1, 2009, is by and between State Street Bank and Trust Company, a Massachusetts trust company (the “Administrator”) and each of the First Eagle Funds and First Eagle Variable Funds, each a business trust organized and existing under the laws of Delaware (each referred to herein as the “Trust”).

WHEREAS, the Trust is an open-end management investment company currently comprised of multiple portfolios, (each, a “Fund” and collectively, the “Funds”), and is registered with the U.S. Securities and Exchange Commission (“SEC”) by means of a registration statement (“Registration Statement”) under the Securities Act of 1933, as amended (“1933 Act”), and the Investment Company Act of 1940, as amended (the “1940 Act”); and

WHEREAS, the parties hereto desire to amend and restate that certain Administration Agreement dated as of January 1, 2009 on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

1. APPOINTMENT OF ADMINISTRATOR

The Trust hereby appoints the Administrator to act as administrator to the Trust for purposes of providing certain administrative services for the period and on the terms set forth in this Agreement. The Administrator accepts such appointment and agrees to render the services stated herein.

The Trust currently consists of the Funds and their respective classes of shares as listed in Schedule A to this Agreement. In the event that the Trust establishes one or more additional Funds with respect to which it wishes to retain the Administrator to act as administrator hereunder, the Trust shall notify the Administrator in writing. Upon written acceptance by the Administrator, such Fund(s) shall become subject to the provisions of this Agreement to the same extent as the existing Funds, except to the extent that such provisions (including those relating to compensation and expenses payable) may be modified with respect to such Fund in writing by the Trust and the Administrator at the time of the addition of such Fund.

The name “First Eagle Funds” refers to the Trust created under a Certificate of Trust filed at the office of the State Secretary of Delaware. The obligations of the “First Eagle Funds” entered into in the name or on behalf thereof by any of the Trustees, representatives or agents thereof are made not individually but in such capacities, and are not binding upon any of the Trustees, Shareholders, representatives or agents of the Trust personally, but bind only the Trust property, and all persons dealing with any class of shares of the Trust must look solely to the Trust property belonging to such class for the enforcement of any claims against the Trust. The Trust has entered into this Agreement with respect to its Funds individually, and jointly. The rights and obligations of the Trust described in this Agreement apply to each individual Fund.

No Fund shall have any liability for any costs or expenses incurred by any other Fund. In seeking to enforce a claim against any Fund, the Administrator shall look to the assets only of that Fund and not to the assets of any other Fund.

2. DELIVERY OF DOCUMENTS

The Trust will promptly deliver to the Administrator copies of each of the following documents and all future amendments and supplements, if any:

a. The Trust’s Declaration of Trust and By-laws;

b. The Trust’s currently effective Registration Statement under the 1933 Act and the 1940 Act and each Prospectus and Statement of Additional Information (“SAI”) relating to the Fund(s) and all amendments and supplements thereto as in effect from time to time;

c. A Secretary’s Certificate providing the authority to (1) enter into this Agreement; (2) give instructions to the Administrator pursuant to this Agreement; and (3) sign checks and pay expenses;

d. A copy of the investment advisory agreement between the Trust and its investment adviser; and

e. Such other certificates, documents or opinions which the Administrator may, in its reasonable discretion, deem necessary or appropriate in the proper performance of its duties, and which can be provided without unreasonable cost to the Funds.

3. REPRESENTATIONS AND WARRANTIES OF THE ADMINISTRATOR

The Administrator represents and warrants to the Trust that:

a. It is a Massachusetts trust company, duly organized and existing under the laws of The Commonwealth of Massachusetts;

b. It has the corporate power and authority to carry on its business in The Commonwealth of Massachusetts;

c. All requisite corporate proceedings have been taken to authorize it to enter into and perform this Agreement;

d. No legal or administrative proceedings have been instituted or threatened which would impair the Administrator’s ability to perform its duties and obligations under this Agreement; and

e. Its entrance into this Agreement shall not cause a material breach or be in material conflict with any other agreement or obligation of the Administrator or any law or regulation applicable to it.

4. REPRESENTATIONS AND WARRANTIES OF THE TRUST

The Trust represents and warrants to the Administrator that:

a. It is a statutory trust, duly organized, existing and in good standing under the laws of the State of Delaware;

b. It has the requisite power and authority under applicable laws and by its Declaration of Trust and By-laws to enter into and perform this Agreement;

c. All requisite proceedings have been taken to authorize it to enter into and perform this Agreement;

d. It is an investment company properly registered with the SEC under the 1940 Act;

e. The Registration Statement has been filed and will be effective and remain effective during the term of this Agreement. The Trust also warrants to the Administrator that as of the effective date of this Agreement, all necessary filings under the securities laws of the states in which the Trust offers or sells its shares have been made;

f. No legal or administrative proceedings have been instituted or threatened which would impair the Trust’s ability to perform its duties and obligations under this Agreement;

g. Its entrance into this Agreement will not cause a material breach or be in material conflict with any other agreement or obligation of the Trust or any law or regulation applicable to it; and

h. As of the close of business on the date of this Agreement, the Trust is authorized to issue unlimited shares of beneficial interest.

5. ADMINISTRATION SERVICES

The Administrator shall provide the following services, subject to the authorization and direction of the Trust and, in each case where appropriate, the review and comment by the Trust’s independent accountants and legal counsel and in accordance with procedures which may be established from time to time between the Trust and the Administrator:

Fund Administration Tax Services

a. Computation of tax basis provisions for excise and income tax purposes, preparation of Form 1120-RIC, Form 8613, and State returns as required for review and signature by public accounting firm.

b. Preparation of required information for shareholder reporting (ICI primary and secondary reporting spreadsheets, transfer agent reallocation worksheets, Form 1099-DIV inserts, etc.)

c. Preparation and review of fiscal and excise tax provisions (includes all book/tax adjustments)

d. Quarterly analysis of Qualified Covered Calls (QCCO) & Straddles

e. Sixty-day notice information

f. Preparation and review of income and gain distributions estimates

g. Preparation of equalization calculations

h. Tax Consulting

Fund Administration Treasury Services

a. Preparation of semi-annual and annual financial reporting

b. Quarterly portfolio of investments reporting

c. N-SAR preparation and filing

d. Audit coordination

e. Performance calculations

The Administrator shall perform such other services for the Trust that are mutually agreed to by the parties from time to time, for which the Trust will pay such fees as may be mutually agreed upon, including the Administrator’s reasonable out-of-pocket expenses. The provision of such services shall be subject to the terms and conditions of this Agreement.

The Administrator shall provide the office facilities and the personnel determined by it to perform the services contemplated herein.

6. FEES; EXPENSES; EXPENSE REIMBURSEMENT

The Administrator shall receive from the Trust such compensation for the Administrator’s services provided pursuant to this Agreement as may be agreed to from time to time in a written Fee Schedule approved by the parties. The fees are accrued daily and billed monthly and shall be due and payable upon receipt of the invoice. Upon the termination of this Agreement before the end of any month, the fee for the part of the month before such termination shall be prorated according to the proportion which such part bears to the full monthly period and shall be payable upon the date of termination of this Agreement. In addition, the Trust shall reimburse the Administrator for its out-of-pocket costs incurred in connection with this Agreement. All rights of compensation and expense reimbursement under this Agreement for services performed as of the termination date shall survive the termination of this Agreement.

The Trust agrees promptly to reimburse the Administrator for any equipment and supplies specially ordered by or for the Trust through the Administrator and for any other expenses not contemplated by this Agreement that the Administrator may incur on the Trust’s behalf at the

Trust’s request or with the Trust’s consent. All expenses referenced in this section must be pre-approved in writing by the Trust and itemized and invoiced promptly by the Administrator. Any reasonable requests by the Administrator to the Trust under this section will not be unreasonably withheld. Any equipment purchased at the direction for or on behalf of the Trust pursuant to this Section will be the property of the Trust.

The Trust will bear all expenses that are incurred in its operation and not specifically assumed by the Administrator. Expenses to be borne by the Trust, include, but are not limited to: organizational expenses; cost of services of independent accountants and outside legal and tax counsel (including such counsel’s review of the Registration Statement, Form N-CSR, Form N-Q, Form N-PX, From N-SAR, proxy materials, federal and state tax qualification as a regulated investment company and other notices, registrations, reports, filings and materials prepared by the Administrator under this Agreement); cost of any services contracted for by the Trust directly from parties other than the Administrator; cost of trading operations and brokerage fees, commissions and transfer taxes in connection with the purchase and sale of securities for the Trust; investment advisory fees; taxes, insurance premiums and other fees and expenses applicable to its operation; costs incidental to any meetings of shareholders including, but not limited to, legal and accounting fees, proxy filing fees and the costs of preparation (e.g., typesetting, page changes and all other print vendor and EDGAR charges, collectively referred to herein as “Preparation”), printing, distribution and mailing of any proxy materials; costs incidental to Board meetings, including fees and expenses of Board members; the salary and expenses of any officer, director\trustee or employee of the Trust; costs of Preparation, printing, distribution and mailing, as applicable, of the Trust’s Registration Statements and any amendments and supplements thereto and shareholder reports; cost of Preparation and filing of the Trust’s tax returns, Form N-1A, Form N-CSR, Form N-Q, Form N-PX and Form N-SAR, and all notices, registrations and amendments associated with applicable federal and state tax and securities laws; all applicable registration fees and filing fees required under federal and state securities laws; the cost of fidelity bond and D&O/E&O liability insurance; and cost of independent pricing services used in computing the Fund(s)’ net asset value.

The Administrator is authorized to and may employ, associate or contract with such person or persons as the Administrator may deem desirable to assist it in performing its duties under this Agreement; provided, however, that the compensation of such person or persons shall be paid by the Administrator and that the Administrator shall be as fully responsible to the Trust for the acts and omissions of any such person or persons as it is for its own acts and omissions.

7. INSTRUCTIONS AND ADVICE

a. At any time, the Administrator may apply to any officer of the Trust or his or her designee for instructions and may consult with its own legal counsel or outside counsel for the Trust or the independent accountants for the Trust at the expense of the Trust, with respect to any matter arising in connection with the services to be performed by the Administrator under this Agreement.

b. The Administrator shall not be liable, and shall be indemnified by the Trust, for any action taken or omitted by it in good faith in reliance upon any such instructions or advice or upon any paper or document believed by it to be genuine and to have been signed by the proper person

or persons. The Administrator shall not be held to have notice of any change of authority of any person until receipt of written notice thereof from the Fund(s). Nothing in this section shall be construed as imposing upon the Administrator any obligation to seek such instructions or advice, or to act in accordance with such advice when received.

8. LIMITATION OF LIABILITY AND INDEMNIFICATION

The Administrator shall be responsible for the performance only of such duties as are set forth in this Agreement and, except as otherwise provided under Section 6, shall have no responsibility for the actions or activities of any other party, including other service providers. The Administrator shall have no liability in respect of any loss, damage or expense suffered by the Trust insofar as such loss, damage or expense arises from the performance of the Administrator’s duties hereunder in good faith reliance upon records that were maintained for the Trust by entities other than the Administrator prior to the Administrator’s appointment as administrator for the Trust. The Administrator shall have no liability for any error of judgment or mistake of law or for any loss or damage resulting from the performance or nonperformance of its duties hereunder unless solely caused by or resulting from the gross negligence or willful misconduct of the Administrator, its officers or employees and any person or persons employed, associated, or contracted by the Administrator as contemplated by the last paragraph of Section 6 of this Agreement. The Administrator shall not be liable for any special, indirect, incidental, punitive or consequential damages, including lost profits, of any kind whatsoever (including, without limitation, attorneys’ fees) under any provision of this Agreement or for any such damages arising out of any act or failure to act hereunder, each of which is hereby excluded by agreement of the parties regardless of whether such damages were foreseeable or whether either party or any entity had been advised of the possibility of such damages. In any event, unless otherwise agreed to by the parties in writing, the Administrator’s cumulative liability for each calendar year (a “Liability Period”) with respect to the Trust under this Agreement regardless of the form of action or legal theory shall be limited to its total annual compensation earned with respect to the Trust and fees payable hereunder during the preceding Compensation Period, as defined herein, for any liability or loss suffered by the Trust including, but not limited to, any liability relating to qualification of the Trust as a regulated investment company or any liability relating to the Trust’s compliance with any federal or state tax or securities statute, regulation or ruling during such Liability Period. “Compensation Period” shall mean the calendar year ending immediately prior to each Liability Period in which the event(s) giving rise to the Administrator’s liability for that period have occurred. Notwithstanding the foregoing, the Compensation Period for purposes of calculating the annual cumulative liability of the Administrator for the Liability Period commencing on the date of this Agreement and terminating on December 31, 2009 shall be the date of this Agreement through December 31, 2009, calculated on an annualized basis, and the Compensation Period for the Liability Period commencing January 1, 2010 and terminating on December 31, 2010 shall be the date of this Agreement through December 31, 2009, calculated on an annualized basis.

The Administrator shall not be responsible or liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, work stoppage, power or other mechanical failure, computer virus, natural disaster, governmental action or communication disruption. In the event of such circumstances, however, the Administrator shall take all

reasonable steps to minimize service interruptions for its clients and reduce the risk of any potential harm to its clients.

The Trust shall indemnify and hold the Administrator harmless from all loss, cost, damage and expense, including reasonable fees and expenses for counsel, incurred by the Administrator resulting from any claim, demand, action or suit in connection with the Administrator’s acceptance of this Agreement, any action or omission by it in the performance of its duties hereunder, or as a result of acting upon any instructions reasonably believed by it to have been duly authorized by the Trust or upon reasonable reliance on information or records given or made by the Trust or its investment adviser, provided that this indemnification shall not apply to actions or omissions of the Administrator, its officers or employees and any person or persons employed, associated, or contracted by the Administrator as contemplated by the last paragraph of Section 6 of this Agreement, in cases of its or their own gross negligence or willful misconduct.

The limitation of liability and indemnification contained herein shall survive the termination of this Agreement.

9. CONFIDENTIALITY

The Administrator agrees to treat as confidential all Confidential Information communicated to it by the Trust in connection with the activities contemplated by this Agreement. “Confidential Information” shall mean all records and information in the Administrator’s possession relating to the Trust and its shareholders and shareholder accounts. The Administrator will not use or disclose Confidential Information for purposes other than the activities contemplated by this Agreement or except as required by law, court process or pursuant to the lawful requirement of a governmental agency, or if the Administrator is advised by counsel that it may incur liability for failure to make a disclosure, or except at the request or with the written consent of the Trust. Confidential Information will not include information which: (a) is or becomes available to the general public through no fault of the Administrator; (b) is independently developed by the Administrator; or (c) is rightfully received by the Administrator from a third party without a duty of confidentiality. Notwithstanding the foregoing, the Trust acknowledges that the Administrator may provide access to and use of Confidential Information relating to the Trust to the Administrator’s respective employees, contractors, agents, professional advisors, auditors or persons performing similar functions, provided that such parties are subject to an agreement to treat the information of Administrator’s clients as confidential. In addition, the Administrator may aggregate Fund data with similar data of other customers of the Administrator (“Aggregated Data”) and may use Aggregated Data for purposes of constructing statistical models so long as such Aggregated Data represents such a sufficiently large sample that no Fund data can be identified either directly or by inference or implication.

10. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS; RECORDS

The Trust assumes full responsibility for complying with all securities, tax, commodities and other laws, rules and regulations applicable to it.

In compliance with the requirements of Rule 31a-3 under the 1940 Act, the Administrator agrees that all records which it maintains for the Trust shall at all times remain the property of the Trust, shall be readily accessible during normal business hours, and shall be promptly surrendered upon the termination of the Agreement or otherwise on written request. The Administrator further agrees that all records that it maintains for the Trust pursuant to Rule 31a-1 under the 1940 Act will be preserved for the periods prescribed by Rule 31a-2 under the 1940 Act unless any such records are earlier surrendered as provided above. Records may be surrendered in either written or machine-readable form, at the option of the Administrator.

11. SERVICES NOT EXCLUSIVE

The services of the Administrator are not to be deemed exclusive, and the Administrator shall be free to render similar services to others. The Administrator shall be deemed to be an independent contractor and shall, unless otherwise expressly provided herein or authorized by the Trust from time to time, have no authority to act or represent the Trust in any way or otherwise be deemed an agent of the Trust.

12. TERM, TERMINATION AND AMENDMENT

(a) This Agreement shall become effective on the date of its execution and shall remain in full force and effect for a period of one (1) years from the effective date and shall automatically continue in full force and effect after such initial term unless either party terminates this Agreement by written notice to the other party at least sixty (60) days prior to the expiration of the initial term.

(b) During the initial term, this Agreement may be terminated only (i) by provision of a notice of nonrenewal as set forth above, (ii) by mutual written agreement of the parties, or (iii) for “cause,” as defined below.

For purposes of this Agreement, “cause” shall mean (a) a material breach (including non-payment of fees or expenses by the Trust) of this Agreement that has not been remedied for thirty (30) days following written notice of such breach from the non-breaching party; (b) a final, unappealable judicial, regulatory or administrative ruling or order in which the party to be terminated has been found guilty of criminal or unethical behavior in the conduct of its business; or (c) financial difficulties on the part of the party to be terminated which are evidenced by the authorization or commencement of, or involvement by way of pleading, answer, consent or acquiescence in, a voluntary or involuntary case under Title 11 of the United States Code, as from time to time is in effect, or any applicable law, other than said Title 11, of any jurisdiction relating to the liquidation or reorganization of debtors or to the modification or alteration of the rights of creditors.

(c) Either party may terminate this Agreement at any time after the initial term upon at least sixty (60) days’ prior written notice to the other party.

(d) Termination of this Agreement with respect to any given Fund shall in no way affect the continued validity of this Agreement with respect to any other Fund.

(e) Upon termination of this Agreement, the Trust shall pay to the Administrator such compensation and any reimbursable expenses as may be due under the terms hereof as of the date of such termination, including reasonable out-of-pocket expenses associated with such termination.

(f) This Agreement may be modified or amended from time to time by mutual written agreement of the parties hereto.

13. NOTICES

Any notice or other communication authorized or required by this Agreement to be given to either party shall be in writing and deemed to have been given when delivered in person or by confirmed facsimile, or posted by certified mail, return receipt requested, to the following address (or such other address as a party may specify by written notice to the other): if to the Trust: The First Eagle Funds, 1345 Avenue of the Americas, New York, NY 10105, Attn: Joseph Malone, Senior Vice President, fax: 212-632-7815 ; if to the Administrator: State Street Bank and Trust Company, 801 Pennsylvania, Kansas City, MO 64105, Attn: Fund Administration Legal Department, fax: 816-871-9675

14. NON-ASSIGNABILITY

This Agreement shall not be assigned by either party hereto without the prior consent in writing of the other party, except that the Administrator may assign this Agreement to a successor of all or a substantial portion of its business, or to a party controlling, controlled by or under common control with the Administrator.

15. SUCCESSORS

This Agreement shall be binding on and shall inure to the benefit of the Trust and the Administrator and their respective successors and permitted assigns.

16. ENTIRE AGREEMENT

This Agreement contains the entire understanding between the parties hereto with respect to the subject matter hereof and supersedes all previous representations, warranties or commitments regarding the services to be performed hereunder whether oral or in writing.

17. WAIVER

The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver nor shall it deprive such party of the right thereafter to insist upon strict adherence to that term or any term of this Agreement. Any waiver must be in writing signed by the waiving party.

18. SEVERABILITY

If any provision of this Agreement is invalid or unenforceable, the balance of the Agreement shall remain in effect, and if any provision is inapplicable to any person or circumstance it shall nevertheless remain applicable to all other persons and circumstances.

19. GOVERNING LAW

This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of The Commonwealth of Massachusetts.

20. REPRODUCTION OF DOCUMENTS

This Agreement and all schedules, exhibits, attachments and amendments hereto may be reproduced by any photographic, xerographic, photostatic, microfilm, micro-card, miniature photographic or other similar process. The parties hereto all/each agree that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding, whether or not the original is in existence and whether or not such reproduction was made by a party in the regular course of business, and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.

21. COUNTERPARTS

This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below as of the date first written above.

	THE FIRST EAGLE FUNDS and THE FIRST EAGLE VARIABLE FUNDS

	By:

	Name:

	Title:


	STATE STREET BANK AND TRUST COMPANY

	By:

	Name:

	Title:

ADMINISTRATION AGREEMENT

SCHEDULE A

Listing of Fund(s) and Classes of Shares

Fund		Classes of Shares
First Eagle Global Fund		A, I & C
First Eagle Overseas Fund		A, I & C
First Eagle U.S. Value Fund		A, I & C
First Eagle Gold Fund		A, I & C
First Eagle Fund of America		A, C & Y

First Eagle Variable Overseas Fund

Exhibit 99.(j)(1)

	PricewaterhouseCoopers LLP
	PricewaterhouseCoopers Center
	300 Madison Avenue
	New York NY 10017
	Telephone (646) 471 3000
	Facsimile (813) 286 6000

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in this Registration Statement on Form N-lA of our report dated February 19, 2009, relating to the financial statements and financial highlights, which appears in the December 31, 2008 Annual Report to Shareholders of First Eagle Overseas Variable Fund, which are also incorporated by reference into the Registration Statement. We also consent to the references to us under the headings “Financial Highlights”, “Independent Registered Public Accounting Firm” and “Financial Statements” in such Registration Statement.

PricewaterhouseCoopers LLP
New York, New York
April 13, 2009

Exhibit 99.(p)

FIRST EAGLE FUNDS AND FIRST EAGLE VARIABLE FUNDS (each a “Fund”) and ARNHOLD AND S. BLEICHROEDER ADVISERS, LLC (the “Adviser”)

PERSONAL SECURITIES TRADING CODE OF ETHICS

Selected Regulatory Guidance

Investment Company Act of 1940 - Rule 17j-1

Investment Advisers Act of 1940 — Rule 204A-1

Regulatory Summary

Rules 17j-1 and 204A-1 under the Investment Company Act of 1940 (the “Act”) and Investment Advisers Act (the “Advisers Act”), respectively, make it unlawful for certain persons, in connection with the purchase or sale of securities, to, among other things, engage in any act, practice or course of business which operates or would operate as a fraud or deceit upon a registered investment company. In compliance with Rules 17j-1 and 204A-1, this Code contains provisions that are reasonably necessary to eliminate the possibility of any such conduct.

Policy

1. Statement of General Principles

This Personal Securities Trading Code of Ethics (“Code”) expresses the policy and procedures of Arnhold and S. Bleichroeder Advisers, LLC (“ASB Advisers” or the “Adviser”) and ASB Securities LLC (“ASB Securities”), First Eagle Funds and First Eagle Variable Funds (each a “Fund”). The Code is enforced to insure that no one is taking advantage of his or her position, or even giving the appearance of placing his or her own interests above those of the Funds or an Account (as defined herein). Investment company personnel must at all levels act as fiduciaries, and as such must place the interests of the shareholders of the Funds or an Account before their own.

2. Definitions

“Access Person” shall mean any director, trustee, officer, general partner of the Funds or of the Adviser, or any Advisory Person of the Funds or of the Adviser, or anyone who has access to non-public information regarding the Funds’ or Accounts’ purchase or sale of securities and is under the Adviser’s supervision and control.

“Account” shall mean any account or investment vehicle (other than a Fund) for which the Adviser may act as adviser or subadviser.

“Advisory Person” of the Funds or an Account means any employee of the Funds or the Adviser who, in connection with his regular functions or duties, makes, participates in, or obtains information regarding the purchase or sale of a security by the Funds or any Account, or whose functions relate to the making of any recommendations with respect to such purchases or sales, and shall include any natural person in a control relationship with the Funds or the Adviser who obtains information concerning recommendations made to the Funds or an Account with regard to the purchase or sale of a security. These latter persons are referred to as “Control Advisory Persons” to the extent they obtain such information on other than an isolated basis.

“Automatic Investment Plan” shall mean a program in which regular periodic purchases (or withdrawals) are made automatically in (or from) investment accounts in accordance with a predetermined schedule and allocation.

The term “beneficial ownership” shall mean any person who has or shares, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise, a direct or indirect pecuniary interest in a Security. “Pecuniary interest” means the opportunity, directly or indirectly, to profit or share in any profit derived from a transaction in the Security. “Indirect pecuniary interest” includes, but is not limited to, an interest in a Security held by members of your immediate family who share your household, including your spouse, children and stepchildren, parents, grandparents, brothers and sisters, and in-laws. Determination of what circumstances constitute an “indirect pecuniary interest” is within the discretion of the Chief Compliance Officer (following consultation with the Investment Compliance Committee).

“Board” shall mean the board of directors of the Funds.

“Chief Compliance Officer” shall mean the Chief Compliance Officer appointed by the Board of the Funds or the Chief Compliance Officer appointed by the Adviser, if different, and any of his, her or their designees.

“Control” shall have the same meaning as that set forth in Section 2(a)(9) of the Act.

The term “Covered Security” shall mean a security defined in Section 2(a)(36) of the Act and shall include options, but shall not include direct obligations of the United States, bankers’ acceptances, bank certificates of deposit, commercial paper, other money market instruments including repurchase agreements, and shares of registered open-end investment companies operating as money market funds as contemplated by Rule 2a-7 of the Act. For the avoidance of doubt, the term Covered Security shall include a First Eagle or other Mutual Fund Security.

“Disinterested Director” of the Funds shall mean a director or trustee thereof who is not an “interested person” of the Funds within the meaning of Section 2(a)(19) of the Act.

“Fund” or “Funds” shall mean First Eagle Funds and First Eagle Variable Funds and any other registered investment company for which the Adviser may act as adviser or subadviser.

The term “First Eagle Security” shall mean any security issued by a separate investment portfolio of a Fund (e.g., a security issued by First Eagle Global Fund, First Eagle Overseas Fund, First Eagle U.S. Value Fund, First Eagle Gold Fund, First Eagle Fund of America or First Eagle Overseas Variable Fund).

“Initial Public Offering” means an offering of securities registered under the Securities Act of 1933, as amended (the “1933 Act”), by or for an issuer of such securities which, immediately before the registration, was not subject to the reporting requirements of Section 13 or 15d of the Securities Exchange Act of 1934 Act.

“Investment Compliance Committee” shall mean the committee appointed by the management of the Adviser.

“Investment Persons” of the Funds or the Adviser includes Portfolio Managers and those persons who provide information and advice to the Portfolio Managers or who help execute the Portfolio Managers’ decisions ( e.g . securities analysts and traders) and shall also include any natural person in a control relationship with the Funds or the Adviser who obtains information concerning recommendations made to the Funds or an Account with regard to the purchase or sale of a security.

“ Limited Offering” shall mean an offering that is exempt from registration under the 1933 Act pursuant to section 4(2) or section 4(6) or pursuant to rule 504, rule 505, or rule 506 under the Securities Act of 1933.

The term “Mutual Fund Security” shall mean any security issued by a registered open-end investment company, other than a security of such a company operating as a money market fund as contemplated by Rule 2a-7 of the Act.

“Portfolio Managers” shall mean those persons who have direct responsibility and authority to make investment decisions for a Fund or an Account.

“Principal Underwriter” shall mean ASB Securities.

The “purchase or sale of a security” includes, among other things, the writing of an option to purchase or sell a security. The sale of a Mutual Fund Security includes its redemption by the issuing mutual fund company or the exchange of the Mutual Fund Security in accord with the exchange policies of the issuing mutual fund company.

Procedures

3. Prohibited Securities Transactions

The prohibitions described below will only apply to a transaction in a Covered Security in which the designated person has, or by reason of such transaction acquires or disposes, any direct or indirect beneficial ownership in such Covered Security (“Securities Transaction”).

A. Blackout Trading Periods - Access Persons

No Access Person shall execute a Securities Transaction on a day during which the Funds or an Account have a pending buy or sell order in that same Covered Security until that order is executed or withdrawn. Any profits realized on trades within the proscribed periods are required to be disgorged to a charity selected by the Adviser.

B. First Eagle and Other Mutual Fund Securities — Access Persons

No Access Person shall engage in a market timing or similar arbitrage strategy with respect to Mutual Fund Shares. For purposes of this prohibition, the purchase and sale, or sale and purchase, of the same Mutual Fund Security (other than First Eagle Securities, the relevant restrictions for which are described in the next paragraph) within 30 calendar days shall be presumed to be market timing unless determined otherwise by the Investment Compliance Committee in writing in advance of a particular transaction. This prohibition covers transactions for clients, as well as transactions for personal accounts. Any profits realized on personal trades in violation of this prohibition are required to be disgorged to a charity selected by the Adviser.

With regard to First Eagle Securities, Access Persons are subject to a short-term holding period of the same length as that generally applied by the relevant portfolio of the Funds with respect to its redemption fee policies. Transactions in First Eagle Securities not effected though an Access Person’s retirement, deferred compensation or other employer-sponsored savings program may be effected only through ASB Securities (or another broker approved for such trades by the Investment Compliance Committee). Regardless of the account in which they are effected, transactions in First Eagle Securities are subject to the reporting requirements of Section 6 below. Any profits realized on trades within the required holding period are required to be disgorged to a charity selected by the Adviser.

C. Blackout Trading Periods - Portfolio Managers and Investment Persons

No Portfolio Manager shall buy or sell a Covered Security within seven calendar days before the Fund or Account that he or she manages trades in that Covered Security. No Portfolio Manager shall buy or sell a Covered Security within seven calendar days after the Fund or Account that he or she manages trades in that Covered Security if such purchase or sale is on the opposite side of the market as that of the Fund or Account. No Investment Person shall buy or sell a Covered Security within seven calendar days before the Fund or Account to which he or she provides analysis, trading or other investment support services trades in that Covered

Security. No Investment Person shall buy or sell a Covered Security within seven calendar days after the Fund or Account to which he or she provides analysis, trading or other investment support services trades in that Covered Security if such purchase or sale is on the opposite side of the market as that of the Fund or Account. Any profits realized on trades within the proscribed periods are required to be disgorged to a charity selected by the Adviser.

D. Ban on Short-Term Trading Profits - Investment Persons and Control Advisory Persons

Investment Persons, including, for this purpose, Control Advisory Persons, may not profit in the purchase and sale, or sale and purchase, of the same (or equivalent) securities within 60 calendar days. (This prohibition does not apply to First Eagle or other Mutual Fund Securities, which are covered by the separate requirements of Section 3B.) Any profits realized on such short-term trades are required to be disgorged to a charity selected by the Adviser.

E. Ban on Securities Purchases of an Initial Public Offering — Access Persons, Investment Persons and Control Advisory Persons

Access Persons and Investment Persons, including, for this purpose, Control Advisory Persons, may not acquire any securities in an Initial Public Offering.

F. Securities Offered in a Limited Offering — Access Persons, Investment Persons and Control Advisory Persons

Access Persons and Investment Persons, including, for this purpose, Control Advisory Persons, may not acquire any securities in a limited offering without the prior written consent of the Chief Compliance Officer. Furthermore, should written consent be given, Investment Persons are required to disclose such investment when participating in an Account’s or Fund’s subsequent consideration of an investment in such issuer. In such circumstances, the Account’s or Fund’s decision to purchase securities of such issuer should be subject to an independent review by the Investment Compliance Committee.

4. Exempted Transactions

A. Subject to compliance with preclearance procedures in accordance with Section 5 below, the prohibitions of Sections 3A, 3B, 3C and 3D of this Code shall not apply to:

(i) Purchases or sales effected in any account over which the Access Person has no direct or indirect influence or control, or in any account of the Access Person which is managed on a discretionary basis by a person other than such Access Person and with respect to which such Access Person does not in fact influence or control such transactions.

(ii) Purchases or sales of securities which are not eligible for purchase or sale by the Funds or an Account. Transactions in First Eagle and other Mutual Fund Securities shall not be exempted under this Section 4.A(ii).

(iii) Purchases or sales which are non-volitional on the part of either the Access Person, the Funds or an Account.

(iv) Purchases which are part of an Automatic Investment Plan.

(v) Purchases effected upon the exercise of rights issued by an issuer pro rata to all holders of a class of its securities, to the extent such rights were acquired from such issuer, and sales of such rights so acquired.

(vi) Any equity securities transaction, or series of related transactions, involving 500 shares or less or amounting to $10,000 or less, in the aggregate if (i) the Access Person has no prior knowledge of transactions in such Covered Security by an Account or the Funds and (ii) if the issuer has a market capitalization (outstanding shares multiplied by the current price per share) greater than $1 billion at the time of purchase. Transactions in First Eagle and other Mutual Fund Securities shall not be exempted under this Section 4.A(vi).

(vii) Any fixed income securities transaction involving $50,000 principal amount or less if the Access Person has no prior knowledge of transactions in such securities by an Account or the Funds.

(viii) All other transactions contemplated by an Access Person which receive the prior approval of the Investment Compliance Committee in accordance with the preclearance procedures described in Section 5 below. Purchases or sales of a specific Covered Security (other than First Eagle or other Mutual Fund Securities, as to which the provisions of the following two sentences apply) may receive the prior approval of the Investment Compliance Committee because the Committee has determined that no abuse is involved and that such purchases and sales would be very unlikely to have any economic impact on an Account or the Funds or on the Account’s or the Fund’s ability to purchase or sell such Covered Securities. In the case of a transaction in a Mutual Fund Security subject to preclearance under the first paragraph of Section 3B, such a purchase or sale may be deemed by the Investment Compliance Committee not to constitute market timing upon review of the transactions particular circumstances. In the case of a transaction in a First Eagle Security subject to preclearance under the second paragraph of Section 3B, the transaction may be excepted by the Investment Compliance Committee from the normal holding period requirement contemplated thereby (but not from any applicable redemption fee) in exceptional circumstances (for example, in cases of significant market disruption or significant personal hardship on the part of the Access Person or his or her immediate family).

B. The prohibition in Section 3A shall not apply to Disinterested Directors of the Funds, unless a Disinterested Director, at the time of a transaction, knew or, in the ordinary course of fulfilling his or her official duties as a Disinterested Director of the Funds, should have known that the Funds had a pending buy or sell order in that same Covered Security, which order had not yet been executed or withdrawn.

C. A transaction by Access Persons (other than Investment Persons) inadvertently effected during the period proscribed in Section 3A will not be considered a violation of the Code and disgorgement will not be required so long as the transaction was effected in accordance with the preclearance procedures described in Section 5 and without prior knowledge of any relevant Securities Transaction by an Account or the Funds.

D. A transaction by Investment Persons inadvertently effected during the period proscribed in Section 3C will not be considered a violation of the Code and disgorgement will not be required so long as the transaction was effected in accordance with the preclearance procedures described in Section 5 and without prior knowledge of any relevant Securities Transaction by an Account or the Funds.

E. The prohibition in Section 3D shall not apply to profits earned from a Securities Transactions in which securities are not the same (or equivalent) to those owned, shorted or in any way traded by the Funds or an Account during the 60 day period; provided, however, that if the Investment Compliance Committee determines that a review of the Access Person’s reported personal securities transactions indicates an abusive pattern of short-term trading, the Committee may prohibit such Access Person from profiting in the purchase and sale, or sale and purchase, of the same (or equivalent) securities within 60 calendar days whether or not such Covered Security is the same (or equivalent) to that owned, shorted or in any way traded by an Account or the Funds.

F. The prohibitions of Sections 3A, 3B, 3C and 3D of this Code shall not apply to Securities Transactions involving [10,000 shares or less of] broad-based market exchange traded funds (ETFs) and HOLDRs. (These Securities are not exempt from the Initial, Annual or Quarterly reporting requirements.)

5. Preclearance

Access Persons (other than Disinterested Directors, except as described in the next paragraph) must preclear all Securities Transactions. In the case of First Eagle Securities and other Mutual Fund Securities, preclearance is required only if the proposed transaction would otherwise violate Section 3B. Pre-clearance shall not be required for Securities Transactions involving [10,000 shares or less of] broad-based market exchange traded funds (ETFs) and HOLDRs. (These Securities are not exempt from the Initial, Annual or Quarterly reporting requirements.)

All requests for preclearance must be submitted to the Investment Compliance Committee or its designee(s). Such requests shall be made by submitting a Personal Investment Request Form through ASBNET, the Adviser’s intranet, substantially in the form annexed hereto as Appendix A, as the same may be amended or supplemented from time to time. All approved orders must be executed by the close of business on the day preclearance is granted. If any order is not timely executed, a request for preclearance must be resubmitted.

Disinterested Directors must preclear transactions in First Eagle Securities that would otherwise violate Section 3B, but need not preclear their personal investments in other securities unless a Disinterested Director knows, or in the course of fulfilling his or her official duties as a Disinterested Director should know, that, within the most recent 15 days, any of the Funds have purchased or sold, or considered for purchase or sale, such Covered Security or is proposing to purchase or sell, directly or indirectly, any Covered Security in which the Disinterested Director has, or by reason of such Securities Transaction would acquire, any direct or indirect beneficial ownership.

6. Reporting

A. The Chief Compliance Officer shall periodically identify all Access Persons, Advisory Persons and Investment Persons and inform such persons of their respective reporting and compliance obligations under this Code of Ethics.

B. Access Persons (other than Disinterested Directors) are required to direct their broker(s) (and any mutual fund company with which they maintain an account) to supply to the Chief Compliance Officer on a timely basis duplicate copies of confirmations of all personal Securities Transactions and copies of periodic statements for all securities or mutual fund accounts, whether existing currently or to be established in the future. A sample letter for this purpose is attached as Appendix B. The Securities Transaction reports and/or duplicates should be addressed “Personal and Confidential.” Compliance with this Code requirement will be deemed to satisfy the reporting requirements imposed on Access Persons under Rules 17j-1 of the Act and 204A-1 of the Advisers Act.

C. A Disinterested Director shall report to the Chief Compliance Officer, no later than thirty days after the end of the calendar quarter in which the transaction to which the report relates was effected, the information required in Appendix C hereto with respect to (i) any sale, redemption or exchange of a First Eagle Security and (ii) any Securities Transaction in which such Disinterested Director has, or by reason of such transaction acquires, any direct or indirect beneficial ownership in a Covered Security that such Disinterested Director knew, or in the course of fulfilling his or her official duties as a director should have known, during the 15-day period immediately preceding or after the date of the Securities Transaction by the Disinterested Director, to have been purchased or sold by the Funds or considered for purchase or sale by the Funds. With respect to those transactions executed through a broker, a Disinterested Director of the Funds may fulfill these requirements by directing the broker(s) to transmit to the Chief Compliance Officer a duplicate of confirmations of such transactions, and copies of the statements of such brokerage accounts, whether existing currently or to be established in the future. The transaction reports and/or duplicates should be addressed “Personal and Confidential” and submitted to the Chief Compliance Officer and may contain a statement that the report shall not be construed as an admission by the person making such report that he or she has any direct or indirect beneficial ownership in the Covered Security to which the report relates. Securities Transactions effected for any account over which a Disinterested Director does not have any direct or indirect influence or control, or which is managed on a discretionary basis by a person other than the Disinterested Director and with respect to which such Disinterested Director does not in fact influence or control such transactions, need not be reported.

D. Whenever a person designated as an Investment Person recommends that an Account or the Funds purchase or sell a Covered Security, he or she shall disclose to the person to whom the recommendation is made, as well as to the Chief Compliance Officer, whether he or she presently owns such Covered Security, or whether he or she is considering the purchase or sale of such Covered Security.

E. Not later than ten days after a person becomes an Access Person, the Access Person will disclose all personal securities holdings and all their accounts with any broker, dealer or mutual fund company (which information must be as of a date no more than forty-five days before the report is submitted), which shall contain the following information:

· The title and type of security, and as applicable the exchange ticker symbol or CUSIP number of shares and principal amount of each Covered Security in which the Access Person has any direct or indirect beneficial ownership;

· The name of any broker, mutual fund company, dealer or bank with which the Access Person maintains an account in which any securities are held for the Access Person’s direct or indirect benefit;

· The nature of the interest (i.e., direct or indirect ownership);

· The name and number of any such account; and

· The date the Access Person submits the report.

The Access Person shall immediately notify the Chief Compliance Officer upon establishing any account with a securities or derivatives broker or dealer or a mutual fund company.

F. Except as otherwise provided below, every Access Person shall report to the Chief Compliance Officer or other designated person, no later than 30 days after the end of each calendar quarter, the following information or such information as required by the CCO:

(a) With respect to transactions in any Covered Security in which such Access Person has, or by reason of such transaction acquires, any direct or indirect beneficial ownership in the Covered Security:

· The date of the transaction, the title, and as applicable the exchange ticker symbol or CUSIP number, interest rate and maturity date, number of shares and principal amount of each Covered Security involved;

· The nature of the transaction (i.e., purchase, sale or any other type of acquisition or disposition);

· The price of the security at which the transaction was effected;

· The nature of interest (i.e., direct or indirect ownership);

· The name of the broker, mutual fund company, dealer or bank with or through which the transaction was effected; and

· The date the Access Person submits the report.

(b) With respect to any account established by the Access Person in which any securities were held during the quarter for the direct or indirect benefit of the Access Person:

· The name of the broker, mutual fund company, dealer or bank with whom the Access Person established the account;

· The date the account was opened or closed;

· The name and number of any such account; and

· The date that the report is submitted by the Access Person.

Such report shall be in substantially the form of Appendix F.

G. All personal matters discussed with the Chief Compliance Officer, or members of the Investment Compliance Committee, and all confirmations, account statements and personal investment reports shall be kept in confidence, but will be available for inspection by the Board of the Funds and the Adviser and by the appropriate regulatory agencies.

7. Annual Certification

A. Each Access Person must acknowledge in writing his or her receipt of the Code and any amendments. In addition, on an annual basis Access Persons will be sent a copy of this Code for their review. Access Persons will be asked to certify that they have read and understand this Code and recognize that they are subject hereto. Access Persons will be further asked to certify annually that they have complied with the requirements of this Code and that they have disclosed or reported all personal securities transactions required to be disclosed or reported pursuant to this Code. A sample of the certification is attached as Appendix D.

B. Annual Holdings, Transactions and Accounts Reports

Except as otherwise provided below, every Access Person shall report to the Chief Compliance Officer or other designated person, no later than January 31 of every calendar year, the following information (which information must be current as of a date no more than 45 days prior to the date of such report) or such other information as required by the CCO:

· The name of any broker, mutual fund company, dealer or bank with which the Access Person maintains an account in which any securities are held for the Access Person’s direct or indirect benefit; and

· The date the Access Person submits the report.

Such report shall include the quarterly transactions for the fourth quarter and shall be in substantially the form of Appendix G.

An Access Person need not make a report under this Section 7B with respect to: (i) securities held in any account over which that person had no direct or indirect influence or control; or (ii) transactions effected pursuant to an Automatic Investment Plan.

Each Access Person shall file with the Chief Compliance Officer as part of the report required by this section the names and affiliations of immediate family members residing with such person, who are employed in the securities or commodities industries and who might be in a position to benefit directly or indirectly from the activities of the Adviser’s personnel in the discharge of their duties.

8. Confidential Status of the Accounts’ and the Funds’ Portfolios

The current portfolio positions of the Accounts and Funds managed, advised and/or administered by the Adviser and current portfolio transactions, programs and analyses must be kept confidential.

If non-public information regarding an Account’s or Fund’s portfolio should become known to any Access Person, whether in the line of duty or otherwise, he or she should not reveal it to anyone unless it is properly part of his or her work to do so.

9. Non-Public Material Information

No Access Person may purchase or sell any Covered Security, or be involved in any way in the purchase or sale of a Covered Security, while in possession of material non-public information about the Covered Security or its issuer, regardless of the manner in which such information was obtained. This prohibition covers transactions for clients, as well as transactions for personal accounts.

Furthermore, no Access Person possessing material non-public information may disclose such information to any person other than the Chief Compliance Officer, except to the extent authorized by the Chief Compliance Officer. Disclosing non-public material information to others is known as “tipping” and is prohibited.

Non-public information includes corporate information, such as undisclosed financial information about a corporation, and market information, such as a soon-to-be-published article about a corporation. Material information is information which an investor would consider important in making an investment decision and which would substantially affect the market price of a security if disclosed.

10. Gifts - Investment Persons

Investment Persons shall not receive any gift or other thing of more than de minimis value from any person or entity that does business with or on behalf of the Funds or an Account. For purposes of this Code, “more than de minimis value” shall mean any gift in excess of a value of $100 per year.

11. Services as a Director in a Publicly Traded Company - Investment Persons

Investment Persons shall not serve on the boards of directors of publicly traded companies, absent prior authorization by the Board of the Funds, based upon a determination that the board service would be consistent with the interests of the Funds and its shareholders (and/or an Account). When such authorization is provided, the Investment Persons serving as a director will be isolated from making investment decisions with respect to the pertinent company through “Chinese Wall” or other procedures.

12. Outside Employment

No Access Person may render investment advice to persons other than the Adviser’s clients, unless the advisory relationship, including the identity of those involved and any fee arrangements, has been disclosed to and approved in writing by the Adviser. All transactions for such outside advisory clients of the Access Person are subject to the reporting requirements of Section 6 above.

13. Compliance Review

The Chief Compliance Officer shall compare the reported personal Securities Transactions with completed and contemplated portfolio transactions of the Funds or an Account to determine whether a violation of this Code may have occurred. The Chief Compliance Officer shall compare reported First Eagle Securities Transactions with Fund or Account records to determine whether a violation of this Code may have occurred. Finally, the Chief Compliance Officer shall review reported Mutual Fund Securities Transactions (other than First Eagle Securities, the reviews for which are described in the preceding sentence) to determine whether market timing or other inappropriate short-term trading with respect to the relevant mutual fund has occurred. The Chief Compliance Officer shall bring any questionable transactions to the attention of the Investment Compliance Committee. Before making any determination that a violation has been committed by any person, the Investment Compliance Committee shall give such person an opportunity to supply additional information regarding the Securities Transaction in question.

14. Sanctions

The Board of the Funds and/or senior management of the Adviser will be informed of violations of this Code on a quarterly basis and may impose such sanctions as they deem appropriate, including inter alia, a letter of censure or suspension or termination of employment of the Access Person or a request for disgorgement of any profits received from a Securities Transaction done in violation of this Code.

15. Board Review

The Board of the Funds shall annually receive a copy of the existing Code, along with a list of recommendations, if any, to change the existing Code based upon experience,

evolving industry practices or developments in applicable laws or regulations. No less frequently than annually, the Chief Compliance Officer shall submit to the Board of the Funds a written report that:

A. Describes any issues arising under this Code or its procedures since the last report to the Board, including, but not limited to, information about material violations of this Code or its procedures and sanctions imposed in response to the material violations; and,

B. Certifies that the Funds, and the Adviser have adopted procedures reasonably necessary to prevent Access Persons from violating this Code.

16. Recordkeeping

The Chief Compliance Officer shall maintain, at the Funds’ and the Adviser’s principal place of business, the following record and shall make these records available to the Securities and Exchange Commission and its representatives:

A.	A copy of each Code in effect during the past five years.
B.	A record of any violation and the action taken.
C.	A copy of each Access Person’s reports.
D.	A record of all Access Persons.
E.	A copy of the written reports to the Board.
F.	A record of the reasons for preapproving transactions in Initial Public Offerings or Private Offerings of Covered Securities.
G.	A record of the reasons for preapproving transactions that would otherwise violate Section 3B.

17. Reporting of Code Violations. Each employee shall promptly notify the Chief Compliance Officer of any violation of the Code.

Appendix A

This trade approval request is the form used on ASB’s intranet website (http://ASBAINET). All Securities Transactions (except as described in the following sentence) should receive preclearance through the intranet site. In the case of First Eagle and other Mutual Fund Securities, only Securities Transactions that would otherwise violate Section 3B require preclearance.

Appendix B

Date

XYZ Broker Dealer/Mutual Fund Company

Re:

Dear Sir/Madam:

Please accept this letter as permission, to allow , an employee of our firm, to maintain an account(s) with your firm.

In regards to the above, please send duplicate confirmations and statements on all transactions to the following:

Arnhold and S. Bleichroeder Advisers, LLC

Attn: Compliance Department

1345 Avenue of the Americas

New York, NY 10105-4300

Thank you for your prompt attention to this matter.

Very Truly Yours,

ARNHOLD AND S. BLEICHROEDER ADVISERS, LLC

By:

Appendix C

Information required to be reported:

(1)		The date of the transaction, the title, the interest rate and maturity date (if applicable), the number of shares and the principal amount of each Covered Security involved;
(2)		The nature of the transaction (i.e., purchase, sale, exchange or any other type of acquisition or disposition);
(3)		The price of the Covered Security at which the transaction was effected;
(4)		The name of the broker, dealer, bank or mutual fund company with or through which the transaction was effected; and
(5)		The date that the report is submitted by the Access Person.

Appendix D

Certification

I hereby certify that:

I have received a current copy of the Personal Securities Trading Code of Ethics and the Arnhold and S. Bleichroeder Advisers, LLC Code of Conduct Under the Advisers Act Rule 204A-1, and have read and understand these Codes.

I recognize that I am subject to these Codes and certify that have complied with the requirements of the Codes.

I have disclosed or reported all my personal securities transactions required to be disclosed or reported pursuant to the Codes.


Signature


Print Name


Date

Appendix E

INITIAL HOLDINGS AND ACCOUNTS REPORT

Statement to Arnhold and S. Bleichroeder Advisers, LLC

By: (Please print your full name)

Today’s Date:

As of the date appearing above, the following are each and every Covered Security and account in which I have a direct or indirect“Beneficial Interest”.

Name of
Security/Fund

Amount
(No. of
Shares or
Principal
Amount)

Exchange
Ticker
Symbol or
CUSIP

Interest
Rate/Maturity
Date (if
applicable

Trade Date

Nature of
Transaction
(Purchase,
Sale, Etc.)

Price

Nature of
Interest
(Direct
ownership,
Spouse,
Control, Etc.

Broker,
Dealer (or
Bank
Acting as
Broker)
Involved

As of the date appearing above, the following accounts (including brokerage accounts, accounts with mutual fund companies, and bank accounts used substantially as brokerage accounts) are those with respect to Reportable Securities of which I have a direct or indirect Beneficial Interest:

Account Name and Number		Firms Through Which Transactions Are Effected

I certify that the Covered Securities listed above, are the only such securities in which I have a direct or indirect Beneficial Interest and that the accounts listed above are the only securities accounts in which I have a direct or indirect Beneficial Interest.

Signature:

	Received By:	Reviewed By:

	Title:	Title:

	Date:	Date:

APPENDIX F

QUARTERLY TRANSACTION AND ACCOUNTS REPORT

Statement to Arnhold and S. Bleichroeder Advisers, LLC

By: (Please print your full name)

For the Calendar quarter ended .

The following are all transactions in Covered Securities of which I have a direct or indirect Beneficial Interest.

Name of
Security/Fund

Amount
(No. of
Shares or
Principal
Amount)

Exchange
Ticker
Symbol or
CUSIP

Interest
Rate/Maturity
Date (if
applicable

Trade Date

Nature of
Transaction
(Purchase,
Sale, Etc.)

Price

Nature of
Interest
(Direct
ownership,
Spouse,
Control, Etc.

Broker,
Dealer (or
Bank
Acting as
Broker)
Involved

Since the prior Quarterly Report, the following accounts (including brokerage accounts, accounts with mutual fund companies, and bank accounts used substantially as brokerage accounts) have been opened with respect to Covered Securities of which I have a direct or indirect Beneficial Interest:

Account Name and Number	Firms through which Transactions Are Effected	Date Account Opened or Closed

In connection with any purchases or sales of securities for clients during the quarter, I disclosed to Arnhold and S. Bleichroeder Advisers, LLC any material interests in my personal securities which might reasonably have been expected to involve a conflict with the interests of clients. Also, I have disclosed all my Covered Securities holdings to Arnhold and S. Bleichroeder Advisers, LLC.

The names and affiliations of my Immediate Family who are employed in the securities or commodities industries and who might be in a position to benefit directly or indirectly from the activities of Arnhold and S. Bleichroeder Advisers, LLC personnel in the discharge of their duties are as follows:

Names		Affiliations

Date:

Signature:

APPENDIX G

ANNUAL HOLDINGS, TRANSACTIONS AND ACCOUNTS REPORT

Statement to Arnhold and S. Bleichroeder Advisers, LLC

By: (Please print your full name)

The following are all transactions in Covered Securities of which I have a direct or indirect Beneficial Interest effected during the fourth quarter.

Name of
Security/Fund

Amount
(No. of
Shares or
Principal
Amount)

Exchange
Ticker
Symbol or
CUSIP

Interest
Rate/Maturity
Date (if
applicable

Trade Date

Nature of
Transaction
(Purchase,
Sale, Etc.)

Price

Nature of
Interest
(Direct
ownership,
Spouse,
Control, Etc.

Broker,
Dealer (or
Bank Acting
as Broker)
Involved

Since the prior Quarterly Report, the following accounts (including brokerage accounts, accounts with mutual fund companies and bank accounts used substantially as brokerage accounts) have been opened with respect to Covered Securities of which I have a direct or indirect Beneficial Interest:

Account Name and Number	Firms Through Which Transactions Are Effected	Date Account Opened or Closed

In connection with any purchases or sales of securities for clients during the quarter, I disclosed to Arnhold and S. Bleichroeder Advisers, LLC any material interests in my Covered Securities which might reasonably have been expected to involve a conflict with the interests of clients.

The names and affiliations of my Immediate Family who are employed in the securities or commodities industries and who might be in a position to benefit directly or indirectly from the activities of Arnhold and S. Bleichroeder Advisers, LLC ‘s personnel in the discharge of their duties are as follows:

Names		Affiliations

I certify that the following are all Covered Securities of which I had a direct or indirect Beneficial Interest as of the year end December 31, 200 .

Name of Security	Amount (No. of Shares or Principal Amount	Nature of Interest (Direct Ownership, Spouse, Control, Etc.	Broker, Dealer (or Bank acting as Broker

*Note: In lieu of you listing on this form each and every Covered Security held as of year-end, you may attach as an exhibit to this document your annual statement(s) from every brokerage firm with which you have a Beneficial Interest. Notwithstanding this accommodation, it remains your sole responsibility to ensure that the information reflected in that statement(s) is accurate and completely discloses ALL Covered Securities holdings as of year-end.

Employee Signature:		Date:

	Received By:	Reviewed By:

	Title:	Title:

	Date:	Date: