As filed with the Securities and Exchange Commission on February 24, 1999.
1933 Act File No. 333-17161
1940 Act File No. 811-07951
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT
UNDER
SECURITIES ACT OF 1933 [x]
POST-EFFECTIVE AMENDMENT NO. 4 [x]
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940 [x]
AMENDMENT NO. 5 [x]
Catholic Values Investment Trust
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(Exact Name of Registrant as Specified in Charter)
24 Federal Street, Boston, Massachusetts 02110
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(Address of Principal Executive Offices)
617-482-8260
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(Registrant's Telephone Number)
Alan R. Dynner
24 Federal Street, Boston, Massachusetts 02110
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(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box):
[ ] Immediately upon filing pursuant to paragraph (b)
[x] On April 30, 1999 pursuant to paragraph (a)(1)
[ ] On (date) pursuant to paragraph (b)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] On (date) pursuant to paragraph (a)(2)
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
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Description of art work on cover of prospectus
Catholic Values Investment Trust logo --
Light blue solid circle with letters CVIT printed over it in blue & violet.
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Catholic Values Investment Trust Equity Fund
Individual Shares
Institutional Service Shares
Institutional Shares
PROSPECTUS
MAY 1, 1999
As with all mutual funds, the Securities and Exchange Commission has not
determined whether the fund is a good investment or whether the information in
this prospectus is accurate or complete. Anyone who tells you otherwise is
committing a crime.
<PAGE>
Table of Contents
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Page
Catholic Values Investment Trust-- Overview ................... 1
Information About the Fund..................................... 2
Objective................................................. 2
Principal Investment Strategies........................... 2
Principal Risks........................................... 2
Who May Want to Invest.................................... 2
Past Performance.......................................... 3
Expenses.................................................. 3
Information About Your Account................................. 4
How the Fund Values its Shares............................ 4
Purchasing Shares......................................... 4
Selling Shares............................................ 5
Dividends and Taxes .......................................... 6
Managing the Fund ............................................ 7
Financial Highlights .......................................... 8
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How to Use this Prospectus
Reading this prospectus will help you decide if investing in the fund is
right for you. Please keep this prospectus for future reference. Included
in this prospectus are descriptions telling you about the fund's
(Graphic -- ship's wheel)
OBJECTIVE: what the fund seeks to achieve.
(Graphic -- compass)
PRINCIPAL INVESTMENT STRATEGIES: how the fund intends to achieve its investment
objective and the strategies used by Wright Investors' Service, the fund's
investment adviser.
(Graphic -- life preserver)
PRINCIPAL RISKS: the risks associated with the fund's primary investments.
(Graphic -- assorted nautical flags)
WHO MAY WANT TO INVEST: decide if the fund is a suitable investment for you.
(Graphic -- ship's log)
PAST PERFORMANCE: the total return on your investment, including income from
dividends and interest, and the increase or decrease in price over various time
periods.
(Graphic -- two crossed anchors with a $ in the center)
EXPENSES: what overall costs you bear by investing in the fund.
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An investment in a mutual fund is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
<PAGE>
CATHOLIC VALUES INVESTMENT TRUST - OVERVIEW
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The Catholic Values Investment Trust was created to offer a series of
mutual fund investment opportunities that combine the fundamental security
selection process with a review by a Catholic Advisory Board. This process
is designed to avoid investments in companies that offer products, services
or engage in activities contrary to the core values of the Roman Catholic
Church. Only one series, the Catholic Values Investment Trust Equity Fund,
is currently available.
THE CATHOLIC ADVISORY BOARD
Using fundamental investment analysis techniques, Wright Investors' Service
selects companies from its Worldscope(R) database to be considered for
inclusion in the fund's portfolio. These companies are high-quality,
well-established and profitable companies. The fund's proposed portfolio
and any subsequent additions are reviewed by the Catholic Advisory Board
ensuring that the companies offer products and services and undertake
activities that are consistent with the core teachings of the Catholic
Church. The Catholic Advisory Board is comprised of independent lay members
familiar with the basic tenets and core teachings of the Roman Catholic
Church. The members of the Catholic Advisory Board are:
Thomas P. Melady, Chairman, Former U.S. Ambassador to the Holy See,
Uganda and Burundi, President Emeritus of Sacred Heart University
Margaret M. Heckler, Former U.S. Representative from Massachusetts 10th
district, former Secretary of Health and Human Services, former
Ambassador to Ireland
Bowie K. Kuhn, Former Commissioner of Baseball
Timothy J. May, Senior Partner, Patton Boggs, LLP
Thomas S. Monaghan, Former President, CEO and Chairman of Domino's
Pizza, Inc.
William A. Wilson, Former (and first) U.S. Ambassador to the Holy See
Although he is not in any way connected with the fund, His Eminence John
Cardinal O'Connor is the ecclesiastical advisor to the Catholic Advisory
Board. Each member of the board is involved in various Catholic
organizations and activities while in contact with numerous Catholic
institutions and clergy. The Catholic Advisory Board identifies companies
whose products, services and/or activities are substantially consistent
with the core Catholic Church teachings, based on the best publicly
available information obtained by Wright and information received from
shareholders and other interested sources. Its members are guided by the
magisterium of the Catholic Church and seek the counsel and advice of
ecclesiastics in determining which companies meet the fund's religious
criteria.
THE SECURITY SELECTION PROCESS - THE APPROVED WRIGHT INVESTMENT LIST (AWIL)
Wright is a leading independent international investment management and
advisory firm with more than 35 years experience. Wright manages about $4.5
billion of assets in portfolios of all sizes and styles as well as a family
of mutual funds. The company developed Worldscope(R), one of the world's
largest and most complete databases of financial information, which
currently includes more than 19,000 corporations in 49 nations. Wright
systematically identifies those companies in the Worldscope(R) database
that meet minimum standards of prudence and thus are suitable for
consideration by fiduciary investors. Wright considers companies meeting
these requirements to be "investment grade." These companies are then
extensively analyzed and evaluated to identify those which meet Wright's
fundamental standards of investment quality. These standards measure the
investment acceptance, financial strength, profitability, stability and
growth of a company. Companies meeting or exceeding these standards are
eligible for inclusion on an AWIL. There are separate AWILs for U.S.
companies, non-U.S. companies and small companies. All the companies on the
AWILs are soundly financed "Blue Chips" with established records of
earnings profitability and equity growth. All have established investment
acceptance and active, liquid markets.
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A Word About Risk
Before you invest in any mutual fund, you should understand the risks involved.
There are two basic risks prevalent in mutual funds investing in common stocks,
such as the fund. They are:
o market risk: When the price of stock falls, the value of the
fund's investments may fall and you could lose money on your
investment.
o management risk: Wright's strategy may not produce the expected
results, causing losses.
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<PAGE>
Catholic Value Investment Trust Equity Fund
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CUSIP: Individual Shares 148916109 Ticker Symbol: CITRY (Unofficial)
Institutional Service Shares 148916307 CITSY (Unofficial)
Institutional Shares 148916208 CITIY (Unofficial)
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OBJECTIVE
The fund seeks long-term growth of capital and reasonable current income
from investments consistent with the core values of the Catholic Church.
Reasonable income means the income that can be achieved, consistent with
the fund's objective of long-term growth of capital, from an equity
portfolio.
(Graphic -- compass)
PRINCIPAL INVESTMENT STRATEGIES
The fund invests in the equity securities of well-established companies.
These securities are included on the quality oriented Approved Wright
Investment Lists (AWILs). Up to 30% of the fund's investments may be in
foreign securities or American Depositary Receipts. Using a bottom-up
fundamental approach, Wright evaluates a company's recent valuation and
price/earnings momentum to determine whether it presents the best value in
terms of current price, and current and forecasted earnings. The investment
process at Wright is directed and controlled by an investment committee of
eight experienced analysts. The committee's selection suggestions are
reviewed by the Catholic Advisory Board. Typically, the fund sells an
individual security when it no longer qualifies for inclusion on the AWILs,
or meets the Catholic Advisory Board's religious criteria. For temporary
defensive purposes, the fund may hold cash or invest more than 20% of its
net assets in short-term debt securities. Although the fund would do this
to reduce losses, defensive investments may hurt the fund's efforts to
achieve its objective.
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"Bottom-up" Approach
to Investing
This refers to the analysis of company information before considering the impact
of industry and economic trends. It differs from the "top-down" approach which
looks first at the economy, then the industry and last the company.
Fundamental
Analysis
The analysis of company financial statements to forecast future price movements
using past records of assets, earnings, sales, products, management and markets.
It differs from technical analysis which relies on price and volume movements of
stocks and does not concern itself with financial statistics.
- ------ END SIDE BAR TEXT ------
(Graphic -- life preserver)
PRINCIPAL RISKS
The Catholic Advisory Board has sole discretion in determining which
companies meet the fund's religious criteria. When a company violates core
Catholic teachings, the board asks Wright to remove it from the portfolio.
This policy may lead to the sale of a security at a disadvantageous time.
Because the fund only considers securities that meet its investment and
religious criteria, the fund's return may be lower than if the fund
considered only investment criteria when selecting investments. However,
Wright does not expect this restriction will have a material effect on
performance. In addition to market and management risk, there are risks
associated with investing in foreign countries. These include currency risk
(changes in foreign currency rates reducing the value of the fund's
assets), seizure, expropriation or nationalization of a company's assets,
and the impact of political, social or diplomatic events. The fund cannot
eliminate risk or assure achievement of its objective. If the risks above
are realized you may lose money on your investment in the fund.
(Graphic -- assorted nautical flags)
WHO MAY WANT TO INVEST
The fund is designed for individuals, dioceses, parishes, other
institutions and organizations seeking a long-term growth fund that does
not invest in companies whose products, services and activities violate the
core values and teachings of the Roman Catholic Church.
<PAGE>
(Graphic -- ship's log)
PAST PERFORMANCE
The information below shows the fund's performance of its Individual Shares
for the periods indicated through December 31, 1998. Total return includes
reinvestment of all dividends and capital gain distributions, and reflects
fund expenses. As with all mutual funds, past performance does not
guarantee future results.
Total Return for the Year Ended December 31, 1998
10%
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0%
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(10)% -1.30%
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Best quarter: 16.98% (4th quarter 1998)
Worst quarter: -20.53%(3rd quarter 1998)
The fund's average annual return is compared with the Standard and Poor's
Mid-Cap 400 Index (S&P Mid-Cap 400). While the fund does not seek to match the
returns of the S&P Mid-Cap 400, this unmanaged index is a good indicator of
mid-cap stock market performance. The S&P Mid-Cap 400, unlike the fund, does not
incur fees or charges.
Average Annual Returns as of December 31, 1998
Life of the Fund
1 Year (May 1, 1997)
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Individual Shares -1.30% 10.19%
Institutional Service Shares -0.80% 10.64%
S&P Mid-Cap 400 19.09% 30.34%
(Graphic -- two crossed anchors with a $ in the center)
EXPENSES
Institutional
Individual Service Institutional
Shares Shares Shares(2)
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Shareholder Fees
(% of offering price)
Maximum deferred sales charge 1.00%(1) None None
(% of redemption proceeds)
Annual Fund Operating Expenses
(deducted directly from fund assets)
Management fee 0.00% 0.00% 0.00%
Distribution and service (12b-1) fees 1.00% 0.25% None
Other expenses 0.00% 0.00% 0.00%
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Total Annual Fund 0.00% 0.00% 0.00%
Operating Expenses
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(1)Shares redeemed during the first year after purchase are subject to
a fee of 1.00% of redemption proceeds.
(2)Estimated. Shares have not yet been issued.
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Understanding
Expenses
Annual fund operating expenses are paid by the fund. As a result, you pay for
them indirectly because they reduce the fund's return. Fund expenses include
management fees, 12b-1 fees and administrative costs, such as shareholder
recordkeeping and reports, custodian and pricing services, and registration
fees.
- ------END SIDE BAR TEXT ------
The following example allows you to compare the cost of investing in the
fund to the cost of investing in other mutual funds by showing what your
costs may be over time. It uses the same assumptions that other funds use
in their prospectuses: $10,000 initial investment, 5% total return for each
year, fund operating expenses remain the same for each period and
redemption after the end of each period. Your actual costs may be higher or
lower, so use this example for comparison only. Based on these assumptions
your costs at the end of each period would be:
Example Costs
1 Year 3 Years 5 Years 10 Years
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Individual Shares $0.00(*) $0.00 $0.00 $0.00
Institutional Service Shares $0.00 $0.00 $0.00 $0.00
Institutional Shares(**) $0.00 $0.00 $0.00 $0.00
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(*) Because of the deferred sales charge, costs are higher if you redeem your
shares within the first year after purchase.
(**) Estimated costs. Shares have not yet been issued.
<PAGE>
INFORMATION ABOUT YOUR ACCOUNT
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HOW THE FUND VALUES ITS SHARES
The price at which you buy or sell fund shares is the net asset value per
share or NAV. The price for each share class is determined by adding the
value of that class's investments, cash and other assets, deducting
liabilities, and then dividing that amount by the total number of shares
outstanding for that class. The NAV is calculated for each class at the
close of regular trading of the New York Stock Exchange (normally 4:00 p.m.
New York time) each day the Exchange is open. It is not calculated on days
the Exchange is closed. The price for a purchase or redemption of fund
shares is the next NAV calculated after your request is received. The NAV
for each class can differ. When the fund calculates its NAV it values its
portfolio securities at the last current sales price on the market where
the security is normally traded, unless Wright deems that price is not
representative of market values. Securities that cannot be valued at these
prices will be valued by Wright at fair value in accordance with procedures
adopted by the trustees. For example, this may happen when an event occurs
that affects the value of a security at a time it is not trading, such as
during a weekend, or after the close of the Exchange, or if the security is
illiquid. Foreign securities may trade during hours and on days that the
Exchange is closed and the fund's NAV is not calculated. Although the
fund's NAV may be affected, you will not be able to purchase or redeem
shares on these days.
PURCHASING SHARES
PURCHASING SHARES FOR CASH
Shares of each class may be purchased without a sales charge at NAV. There
are no investment minimums for purchases through bank trust departments or
qualified retirement plans. The fund may reject any purchase order, or
limit or suspend the offering of its shares.
Type of Initial Additional
Account Investment Investment
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Individual Shares $1,000 None
Institutional Service Shares $500,000 None
Institutional Shares $3,000,000 None
Automatic Investments $100 $100
(monthly or quarterly)
Authorized dealers, including investment dealers, banks or other
institutions, may impose investment minimums higher than those imposed by
the fund. They may also charge for their services. There are no charges if
you purchase your shares directly from the fund.
HOW TO BUY SHARES
o If you buy shares directly from the fund, please refer to your
Shareholder Manual for instructions on how to buy fund shares.
o If you buy shares through bank trust departments or other fiduciary
institutions, please consult your trust or investment officer.
o If you buy shares through a broker, please consult your broker for
purchase instructions.
o If you buy shares through an account with a registered investment adviser
or financial planner, please contact your investment adviser or planner.
o If you buy shares through a retirement plan, please consult your plan
documents or speak with your plan administrator.
- -------SIDE BAR TEXT---------
Paying for Shares
You may buy shares by wire, check, Federal Reserve draft, or other
negotiable bank draft, payable in U.S. dollars and drawn on U.S. banks. Third
party checks will not be accepted. A charge is imposed on any returned checks.
- -------END SIDE BAR TEXT--------
<PAGE>
PURCHASING SHARES THROUGH EXCHANGE OF SECURITIES
You may buy shares by delivering to the fund's custodian securities that
meet the fund's investment objective and policies, have easily determined
market prices and are otherwise acceptable. Exchanged securities must have
a minimum aggregate value of $5,000. Securities are valued as of the date
they are received by the fund. If you want to exchange securities for fund
shares, you should furnish a list with a full description of these
securities that are proposed to be delivered. See the Shareholder Manual
for detailed instructions.
SELLING SHARES
You may redeem or sell fund shares on any business day. NO REDEMPTION
REQUEST WILL BE PROCESSED UNTIL YOUR SHARES HAVE BEEN PAID FOR IN FULL. IF
THE SHARES TO BE REDEEMED WERE PURCHASED BY CHECK, THE REDEMPTION PAYMENT
WILL BE DELAYED UNTIL THE CHECK HAS BEEN COLLECTED. Telephone and internet
redemption procedures are described in the Shareholder Manual.
In times of drastic economic or market conditions, you may have
difficulty selling shares by telephone or the internet. These
redemption options may be modified or terminated without notice to
shareholders. Redemption requests received in "proper form" before
4:00 p.m. New York time will be processed at that day's NAV."Proper form"
means that the fund has received your request, all shares are paid for,
and all documentation along with any required signature guarantee,
are included. The fund normally pays redemption proceeds by check
within one business day to the address of record. Payment will be by wire
if you specified this option on your account application.
To sell your shares, please refer to your Shareholder Manual, or consult
your trust officer, adviser or plan administrator for more information.
REDEMPTIONS IN-KIND
Although the fund expects to pay redemption proceeds in cash, it reserves
the right to redeem shares in-kind giving the shareholder readily
marketable portfolio securities instead of cash. This is done to protect
the interests of remaining shareholders. If this occurs, you will incur
transaction costs if you sell the securities.
INVOLUNTARY REDEMPTION
If your account falls below $500 the fund may redeem your shares. You will
receive notice 60 days before this happens. Your account will not be
redeemed if the balance is below the minimum due to investment losses. No
redemption fee or contingent deferred sales charges will be assessed on
involuntary redemptions.
- -----SIDE BAR TEXT-----
Deferred Sales Charge
If you redeem individual shares within the first year after purchase, you will
pay a contingent deferred sales charge of 1.0%. This charge may be waived
under certaincircumstances. Please refer to your Shareholder Manual for details
on the contingent deferred sales charge.
- -----END SIDE BAR TEXT----
<PAGE>
DIVIDENDS AND TAXES
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DIVIDENDS AND DISTRIBUTIONS
Unless you tell us that you want to receive your distributions in cash,
they will be reinvested automatically in fund shares. The fund generally
makes two different kinds of distributions:
o CAPITAL GAINS FROM THE SALE OF PORTFOLIO SECURITIES. The fund
distributes any net realized capitalgains annually, normally in
December.
o NET INVESTMENT INCOME FROM INTEREST OR DIVIDENDS RECEIVED.
The fund distributes its investment income at least semi-annually.
Most of the fund's distributions are expected to be from capital gains.
TAX CONSEQUENCES
Buying, selling, holding or exchanging mutual fund shares may result in a
gain or a loss and is a taxable event. Distributions, whether received in
cash or additional fund shares, are subject to federal income tax.
Transaction Tax Status
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Income dividends Ordinary income
Short-term capital gains Ordinary Income
Long-term capital gains Capital gains
The fund may be subject to foreign withholding taxes or other foreign taxes
on some of its foreign investments. This will reduce the yield or total
return on those investments.
Your investment in the fund may have additional tax consequences.
Please consult your tax advisor on state, local or other applicable tax
laws.
- ------- SIDE BAR TEXT -------
Tax Considerations
Unless your investment is in a tax-deferred account you may want to avoid:
o Investing in the fund near the end of its fiscal year. If the fund makes a
capital gains distribution you will receive some of your investment back as a
taxable distribution.
o Selling shares at a loss for tax purposes and then making an identical
investment within 30 days. This results in a "wash sale" and you will not be
allowed to claim a tax loss.
- ------- END SIDE BAR TEXT --------
<PAGE>
MANAGING THE FUND
Wright Investors' Service, Inc. manages the fund's investments. Wright is
located at 1000 Lafayette Boulevard, Bridgeport, CT 06604. For the fiscal
year ended December 31, 1998, Wright received an advisory fee at the annual
rate of XXX of the fund's average daily net assets.
INVESTMENT COMMITTEE
An investment committee of senior officers controls the investment
selections, policies and procedures of the fund. These officers are all
experienced analysts with different areas of expertise and over 195 years
of combined service with Wright. The investment committee consists of the
following members:
<TABLE>
<CAPTION>
Committee Member Title Joined Wright in
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Peter M. Donovan, CFA President and Chief Executive Officer 1966
Judith R. Corchard Chairman of the investment committee 1960
Executive Vice President - Investment Management
Jatin J. Mehta, CFA Chief Investment Officer - U.S. Equities 1969
Harivadan K. Kapadia, CFA Senior Vice President - Investment Analysis and Information 1969
Michael F. Flament, CFA Senior Vice President - Investment and Economic Analysis 1972
James P Fields, CFA Senior Vice President - Fixed Income Investments 1982
Amit S. Khandwala Senior Vice President - International Investments 1986
Charles T. Simko, Jr., CFA Senior Vice President - Investment Research 1985
</TABLE>
The Catholic Advisory Board reviews the investments selected by Wright.
YEAR 2000 READINESS
Mutual funds and businesses around the world could be adversely affected if
computers do not properly process date-related information after the year
2000. Wright is addressing this issue and is getting reasonable assurances
from the fund's other major service providers that they too are addressing
these issues to preserve the smooth functioning of the fund's trading,
pricing, shareholder account, custodial and other operations. Wright is
also investigating the vulnerability to year 2000 problems of companies in
the fund's portfolio.
Improperly functioning computers may disrupt securities markets or
result in overall economic uncertainty. Individual companies may also
be adversely affected by the cost of fixing their computers, which
could be substantial. There is no guarantee that all problems will be
avoided.
THE EURO
The European countries have adopted the Euro as their common currency.
Existing national currencies of these countries will be sub-currencies of
the Euro until July 1, 2002, when the old currencies will disappear
entirely. The introduction of the Euro presents some possible risks, which
could adversely affect the value of securities held by the fund, as well as
possible adverse tax consequences. There could be unpredictable effects on
trade and commerce, resulting in increased volatility for all financial
markets.
DISTRIBUTION AND SERVICE PLANS
The fund has adopted a 12b-1 plan permitting it to pay a fee to finance the
distribution of its shares. Wright Investors' Service Distributors, Inc.
(WISDI), the principal underwriter and distributor of the fund's shares,
receives a distribution fee of up to 0.75% of the average daily net assets
of the Individual Share class and up to 0.25% of the Institutional Service
Share class's average daily net assets. Because this fee is paid on an
ongoing basis, it may cost you more than other types of sales charges over
time.
The fund has also adopted a service plan. This plan allows WISDI to
be reimbursed for payments to intermediaries for providing account
administration and personal and account maintenance services to fund
shareholders. The annual service fee may not exceed 0.25% of the average
daily net assets of each class of shares.
- ------ SIDE BAR TEXT-----
Administrator
Eaton Vance Management serves as the fund's administrator and is responsible for
managing its daily business affairs. Eaton Vance's services include operating
the fund's order room, recordkeeping, preparing and filing documents required to
comply with federal and state securities laws, supervising the activities of the
fund's custodian and transfer agent, providing assistance in connection with the
trustees' and shareholders' meetings and other necessary administrative
services.
- ------ END SIDE BAR TEXT -------
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The financial highlights will help you understand the fund's financial
performance for the periods indicated. Certain information reflects
financial results for a single fund share. Total return shows how much your
investment in the fund increased or decreased during each period, assuming
you reinvested all dividends and distributions. XXXXXXXX, independent
certified public accountants, audited this information. Their report is
included in the fund's annual report, which is available upon request.
<PAGE>
(CVIT logo - same as front cover)
INVESTMENT COMPANY ACT FILE NUMBER
Catholic Values Investment Trust...............................811-07951
Catholic Values Investment Trust Equity Fund
For More Information
Additional information about the fund's investments is available in the
fund's semi-annual and annual reports to shareholders. The fund's annual
report contains a discussion of the market conditions and investment
strategies that affected the fund's performance over the past year.
You may want to read the statement of additional information (SAI) for more
information on the fund and the securities it invests in. The
SAI is incorporated into this prospectus by reference, which means
that it is considered to be part of the prospectus.
You can get free copies of the semi-annual and annual reports and the SAI,
request other information or get answers to your questions about the
fund by writing or calling:
Catholic Values Investment Trust
c/o Wright Investors' Service Distributors, Inc.
1000 Lafayette Boulevard
Bridgeport, CT 06604
(888) 974-4486
e-mail: [email protected]
Copies of documents and application forms can be viewed and downloaded from
the fund's website: www.catholicinvestment.com
Text-only versions of fund documents can be viewed online or downloaded
from the SEC's web site at www.sec.gov. You can also obtain copies by visiting
the SEC's Public Reference Room in Washington DC. For information on the
operation of the Public Reference Room, call (800) SEC-0330. Copies of documents
may also be obtained by sending your request and the appropriate fee to the
SEC's Public Reference Section, Washington, DC 20549-6009.
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
Individual Shares
Institutional Service Shares
Institutional Shares
May 1, 1999
CATHOLIC VALUES INVESTMENT TRUST
24 Federal Street
Boston, Massachusetts 02110
------------------------------------------------------------------------
Catholic Values Investment Trust Equity Fund
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TABLE OF CONTENTS
The Fund's Investment Objective and Policies.. 2
Additional Investment Policies and Other
Information ................................ 3
Additional Information about the Trust...... 6
Investment Restriction...................... 7
Trustee, Officers and the
Catholic Advisory Board..................... 8
Control Person and Principal
Holders of Shares........................... 10
Investment Advisory and
Administrative Services..................... 10
Custodian................................... 12
Independent Certified Public Accountants.... 12
Brokerage Allocation........................ 12
Pricing of Shares........................... 13
Principal Underwriter....................... 13
Service Plan................................ 15
Taxes....................................... 15
Calculation of Performanceand Yield
Quotations.................................. 16
Financials.................................. 17
Appendix.................................... 18
This Statement of Additional Information is NOT a prospectus and is authorized
for distribution to prospective investors only if preceded or accompanied by the
current Prospectus of the Catholic Values Investment Trust (the "Trust")
offering shares of the Catholic Values Investment Trust Equity Fund (the
"Fund"), dated May 1, 1999, as supplemented from time to time, which is
incorporated herein by reference. This Statement of Additional Information
should be read in conjunction with the Prospectus. A copy of the Prospectus may
be obtained without charge from Wright Investors' Service Distributors, Inc.,
1000 Lafayette Boulevard, Bridgeport, Connecticut 06604 (Telephone:
888-974-4486) or from the Fund's website (http://www.catholicinvestment.com).
THE FUND'S INVESTMENT OBJECTIVE AND POLICIES
The Fund's objective is long-term growth of capital and reasonable current
income. Reasonable current income means the income that can be achieved,
consistent with the Fund's goal of long-term growth of capital, from an equity
portfolio.
The Fund will, through continuous supervision by Wright and the Catholic
Advisory Board, pursue its objective by investing in a broadly diversified
portfolio consisting primarily of equity securities of high-quality,
well-established and profitable U.S. and non-U.S. companies that offer products
or services and undertake activities that are consistent with the core teachings
of the Catholic Church.
HOW INVESTMENTS ARE SELECTED
Securities selected for the Fund are drawn from investment lists prepared
by Wright and known as The Approved Wright Investment List (the "AWIL") and The
International Approved Wright Investment List (the "International AWIL").
Securities drawn from these Investment Lists will be reviewed for compliance
with the core teachings of the Catholic Church by the Catholic Advisory Board,
which is appointed by the Board of Trustees of the Trust (the "trustees") and is
made up of prominent lay members of the Catholic Church.
THE APPROVED WRIGHT INVESTMENT LISTS (AWIL AND INTERNATIONAL AWIL). Wright
systematically reviews about 6,000 U.S. companies and about 13,000 non-U.S.
companies in The Worldscope(R) database which it developed. This review first
identifies those companies which, on the basis of at least five years of audited
records, meet the minimum standards of prudence (e.g. the value of the company's
assets and shareholders' equity exceeds certain minimum standards and its
operations have been profitable during the last three years) and thus are
suitable for consideration by fiduciary investors. Companies meeting these
requirements (about 2,700 companies) are considered by Wright to be suitable for
prudent investment. They may be large or small, may have their securities traded
on exchanges or over the counter and may include companies not currently paying
dividends on their shares.
These approximately 2,700 companies are then subjected to extensive
analysis and evaluation in order to identify those which meet Wright's 32
fundamental standards of Investment Quality. Only those companies which meet or
exceed all of these standards (a subset of the 2,700 companies considered
suitable for prudent investment) are eligible for selection by the Wright
Investment Committee for inclusion in the Investment Lists.
All companies on the Investment Lists are, in the opinion of Wright,
soundly financed with established records of earnings profitability and equity
growth. All have established investment acceptance and active liquid markets for
their publicly owned shares. The companies on the Investment Lists will be
referred to herein as "Blue Chips."
THE CATHOLIC ADVISORY BOARD. The Catholic Advisory Board assures that the
Fund's investments are consistent with Catholic values. Each member of the Board
is involved in various Catholic organizations and activities and is in contact
with numerous Catholic institutions and Catholic clergy. Using the best publicly
available information obtainable by Wright, the Catholic Advisory Board will
identify those companies recommended by Wright whose products, services and/or
activities are substantially consistent with core Catholic Church teachings. In
addition, information received from shareholders, secondary materials, and
general input from interested sources is consistently revised and evaluated. The
result is continuous dialogue, continuous information input, continuous review,
and thus continuous evaluation. It is believed that independent thinking and
independent information support a Fund that adheres to Catholic doctrine while
balancing changes in the marketplace, changes in informational input, and
changes in value systems. Thus, the Fund combines Catholic values with
investment values.
The Catholic Advisory Board will have sole discretion to determine which
companies meet the Fund's religious criteria. Wright will be solely responsible
for evaluating the investment merits of the Fund's portfolio holdings. When a
company is found not to be in compliance with core Catholic teachings, Wright is
asked to remove it from the portfolio. This policy may cause the Fund to dispose
of a security at a time when it may be disadvantageous from an investment
viewpoint to do so.
As the Fund will consider for investment only securities which meet the
Fund's investment and religious criteria, the return on securities chosen may be
lower than if the Fund considered only investment criteria when selecting
investments. However, Wright does not expect there will be a material effect on
the performance.
PRIMARY INVESTMENTS. The Fund will, under normal market conditions, invest
at least 80% of its net assets in equity securities of Blue Chip companies,
including common stocks, preferred stocks, warrants and securities convertible
into stock. As a matter of nonfundamental policy, it is expected that the Fund
will normally be fully invested in equity securities. However, the Fund may
invest up to 20% of its net assets in the short-term debt securities described
under "Defensive and Certain Short-Term Investments." In addition, for temporary
defensive purposes the Fund may hold cash or invest more than 20% of its net
assets in these short-term debt securities.
ADDITIONAL INVESTMENT POLICIES AND OTHER INFORMATION
U.S. GOVERNMENT, AGENCY AND INSTRUMENTALITY SECURITIES.--U.S. Government
securities in which the Fund may invest are short-term obligations issued by the
Treasury and include bills, certificates of indebtedness, notes, and bonds.
Agencies and instrumentalities of the U.S. Government are established under the
authority of an act of Congress and include, but are not limited to, the
Government National Mortgage Association ("GNMA"), the Tennessee Valley
Authority, the Bank for Cooperatives, the Farmers Home Administration, Federal
Home Loan Banks, Federal Intermediate Credit Banks, Federal Land Banks, and the
Federal National Mortgage Association ("FNMA").
The Fund has no current intention of investing in securities issued by GNMA
or FNMA or in any other mortgage-backed securities.
FOREIGN INVESTMENT. The Fund may invest up to 30% of its total assets in
equity securities of foreign companies that are on the International AWIL and
that are traded on a securities market of the country in which the company is
located or other foreign securities exchanges. In addition, the Fund may
purchase securities in the form of American Depositary Receipts ("ADRs") or
similar securities representing interests in an underlying foreign security.
ADRs are not necessarily denominated in the same currency as the underlying
foreign securities. If an ADR is not sponsored by the issuer of the underlying
foreign security, the institution issuing the ADR may have reduced access to
information about the issuer.
Investments in foreign securities involve risks in addition to those
associated with investments in the securities of U.S. issuers. These risks
include less publicly available financial and other information about foreign
companies; less rigorous securities regulation; the potential imposition of
currency controls, foreign withholding and other taxes; and war, expropriation
or other adverse governmental actions. Foreign equity markets may be less liquid
than United States markets and may be subject to delays in the settlement of
portfolio transactions. Brokerage commissions and other transaction costs in
foreign markets tend to be higher than in the United States. The value of
foreign securities denominated in a foreign currency will vary in accordance
with changes in currency exchange rates, which can be volatile. In addition, the
prices of unsponsored ADRs may be more volatile than if they were sponsored by
the issuers of the underlying securities. These considerations generally are of
greater concern in developing countries.
REPURCHASE AGREEMENTS.--involve purchase of U.S. Government securities. At
the same time the Fund purchases the security, it resells it to the vendor (a
member bank of the Federal Reserve System or recognized securities dealer that
meets Wright credit standards), and is obligated to redeliver the security to
the vendor on an agreed-upon date in the future. The resale price exceeds the
purchase price and reflects an agreed-upon market rate unrelated to the coupon
rate on the purchased security. Such transactions afford an opportunity for the
Fund to earn a return on cash which is only temporarily available. The Fund's
risk is the ability of the vendor to pay an agreed-upon sum upon the delivery
date. The Fund believes this risk is limited to the difference between the
market value of the security and the repurchase price provided for in the
repurchase agreement.
Repurchase agreements must be fully collateralized at all times. In the
event of a default or bankruptcy by a vendor under a repurchase agreement, the
Fund will seek to liquidate such collateral. However, the exercise of the right
to liquidate such collateral could involve certain costs, delays and
restrictions and is not ultimately assured. To the extent that proceeds from any
sale upon a default of the obligations to repurchase are less than the
repurchase price, the Fund could suffer a loss.
In all cases when entering into repurchase agreements with other than
FDIC-insured depository institutions, the Fund will take physical possession of
the underlying collateral security, or will receive written confirmation of the
purchase of the collateral security and a custodial or safekeeping receipt from
a third party under a written bailment for hire contract, or will be the
recorded owner of the collateral security through the Federal Reserve Book-Entry
System.
DEFENSIVE AND CERTAIN SHORT-TERM INVESTMENTS. Under normal market
conditions up to 20% of the Fund's net assets or, during periods of unusual
market conditions, when Wright believes that investing for temporary defensive
purposes in appropriate, all or any portion of the Fund's assets may be held in
cash, money market instruments or other short-term obligations. These include
short-term obligations issued or guaranteed as to interest and principal by the
U.S. Government or any agency or instrumentality thereof (including repurchase
agreements collateralized by such securities).
The Fund may invest in the following U.S. dollar denominated, high quality
short-term obligations to the extent set forth above:
Certificates of Deposit -- are certificates issued against funds deposited
in a bank, are for a definite period of time, earn a specified rate of return,
and are normally negotiable.
Bankers' Acceptances -- are short-term credit instruments used to finance
the import, export, transfer or storage of goods. They are termed "accepted"
when a bank guarantees their payment at maturity.
Commercial Paper -- refers to promissory notes issued by corporations in
order to finance their short-term credit needs. Commercial paper acquired by the
Fund must, at the date of investment, be rated A-1 by Standard & Poor's Ratings
Group ("S&P") or P-1 by Moody's Investors Service, Inc. ("Moody's"), or, if not
rated by such rating organizations, be deemed by the trustees to be of
comparable quality.
Finance Company Paper -- refers to promissory notes issued by finance
companies in order to finance their short-term credit needs. Finance company
paper must have the same ratings as commercial paper at the time of purchase.
See "Commercial Paper" above.
Corporate Obligations -- include bonds and notes issued by corporations and
other entities in order to finance short-term credit needs. Corporate
obligations and other debt instruments in which the Fund may invest must, at the
date of investment, be rated AA or better by S&P or Aa or better by Moody's or,
if not rated by such rating organizations, be deemed by the trustees to be of
comparable quality.
The Fund may invest in instruments and obligations of banks that have other
relationships with the Fund, Wright or Eaton Vance. No preference will be shown
towards investing in banks which have such relationships.
The prices of fixed income securities vary inversely with interest rates.
Therefore, the value of the Fund's investments in convertible securities and
short-term obligations will decline when interest rates are rising. The
investment objective and, unless otherwise indicated, policies of the Fund may
be changed by the Trustees without a vote of the Fund's shareholders. The Fund
is not a complete investment program and there is no assurance that the Fund
will achieve its investment objective. The market price of securities held by
the Fund and the net asset value of the Fund's shares will fluctuate in response
to stock market developments and currency exchange rate fluctuations.
"WHEN ISSUED" SECURITIES -- Securities are frequently offered on a
"when-issued" basis. When so offered, the price, which is generally expressed in
terms of yield to maturity, is fixed at the time the commitment to purchase is
made, but delivery and payment for the when-issued securities may take place at
a later date. Normally, the settlement date occurs 15 to 90 days after the date
of the transaction. The payment obligation and the interest rate that will be
received on the securities are fixed at the time the Fund enters into the
purchase commitment. During the period between purchase and settlement, no
payment is made by the Fund to the issuer and no interest accrues to the Fund.
To the extent that assets of the Fund are held in cash pending the settlement of
a purchase of securities, the Fund would earn no income; however, the Fund
intends to be fully invested to the extent practicable and subject to the
policies stated above. While when-issued securities may be sold prior to the
settlement date, it is intended that such securities will be purchased for the
Fund with the purpose of actually acquiring them unless a sale appears to be
desirable for investment reasons.
At the time a commitment to purchase securities on a when-issued basis is
made for the Fund, the transaction will be recorded and the value of the
security reflected in determining the Fund's net asset value. The Fund will
establish a segregated account with its Custodian in which the Fund will
maintain cash and liquid securities equal in value to commitments for
when-issued securities. If the value of the securities placed in the separate
account declines, additional cash or securities will be placed in the account on
a daily basis so that the value of the account will at least equal the amount of
the Fund's when-issued commitments. Such segregated securities either will
mature or, if necessary, be sold on or before the settlement date.
Securities purchased on a when-issued basis and the securities held by the
Fund are subject to changes in value based upon the public's perception of the
creditworthiness of the issuer and changes in the level of interest rates.
(Thus, both positions will change in value in the same way, i.e., both
experiencing appreciation when interest rates decline and depreciation when
interest rates rise.) Therefore, to the extent that the Fund remains
substantially fully invested at the same time that it has purchased securities
on a when-issued basis, there will be greater fluctuations in the market value
of the Fund's net assets than if only cash were set aside to pay for when-issued
securities.
The Fund has no current intention of investing in when-issued securities.
ILLIQUID AND RESTRICTED SECURITIES. The Fund may purchase securities that
are not registered ("restricted securities") under the Securities Act of 1933
("1933 Act"), including securities offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act and commercial paper sold in reliance
on Section 4(2) of the 1933 Act. However, the Fund will not invest more than 15%
of its net assets in illiquid investments, which include repurchase agreements
maturing in more than seven days, securities that are not readily marketable and
restricted securities. If the value of the Fund's illiquid investments increased
to more than 15% of net assets, Wright would begin reducing these investments in
an orderly manner to the extent necessary to comply with the 15% limit. If the
Board of Trustees determines, based upon a continuing review of the trading
markets for specific Rule 144A securities, that they are liquid, then such
securities may be purchased without regard to the 15% limit. The trustees may
adopt guidelines and delegate to Wright the daily function of monitoring and
determining the liquidity of restricted securities. The trustees, however, will
retain sufficient oversight and be ultimately responsible for the
determinations. The trustees will carefully monitor the Fund's investments in
these securities, focusing on such important factors, among others, as
valuation, liquidity and availability of information.
The Fund may acquire other restricted securities including securities for
which market quotations are not readily available. These securities may be sold
only in privately negotiated transactions or in public offerings with respect to
which a registration statement is in effect under 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 prevailed when it decided to sell. Restricted securities will be priced at
fair market value as determined in good faith by the Trust's trustees.
The Fund does not currently intend to purchase restricted securities.
BORROWING; LENDING PORTFOLIO SECURITIES.
The Fund may borrow for temporary or emergency purposes in an amount up to
one-third of the Fund's total assets. The Fund may lend portfolio securities
with a value up to 30% of its total assets to enhance its income. The Fund may
seek to increase income by lending portfolio securities to broker-dealers or
other institutional borrowers. Under present regulatory policies of the
Securities and Exchange Commission, such loans are required to be secured
continuously by collateral in cash or liquid securities held by the Fund's
custodian and maintained on a current basis at an amount at least equal to the
market value of the securities loaned, which will be marked to market daily.
Cash equivalents include certificates of deposit, commercial paper and other
short-term money market instruments. The Fund would have the right to call a
loan and obtain the securities loaned at any time on up to five business days'
notice. The Fund would not have the right to vote any securities having voting
rights during the existence of a loan, but would call the loan in anticipation
of an important vote to be taken among holders of the securities or the giving
or withholding of their consent on a material matter affecting the investment.
The Fund may pay reasonable fees in connection with securities loans. Wright
will evaluate the creditworthiness of prospective institutional borrowers and
monitor the adequacy of the collateral to reduce the risk of default by
borrowers.
The Fund does not currently intend to engage in securities loans.
WARRANTS AND CONVERTIBLE SECURITIES. The Fund may invest up to 5% of its
net assets in warrants. Warrants acquired by the Fund will entitle it to buy
common stock at a specified price and time. The Fund may invest up to 5% of its
net assets in convertible securities. Convertible debt securities and
convertible preferred stock entitle the Fund to acquire the issuer's stock by
exchange or purchase at a predetermined rate.
Warrants are subject to the same market risks as stocks, but may be more
volatile in price. The Fund's investments in warrants will not entitle it to
receive dividends or exercise voting rights and will become worthless if the
warrants cannot be profitably exercised before their expiration dates.
Convertible securities are subject both to the credit and interest rate risks
associated with debt obligations and to the stock market risk associated with
equity securities. Convertible debt securities in which the Fund may invest
must, at the date of investment, be rated AA or better by S&P or Aa or better by
Moody's or, if not rated by one of these rating organizations, be deemed by the
trustees to be of comparable quality.
INTEREST RATE RISK. The market value of the U.S. Government securities,
short-term investments and convertible securities in which the Fund may invest
varies inversely with changes in the prevailing levels of interest rates. For
example, if interest rates rise after one of the foregoing securities has been
purchased, the value of the security would decline.
SHORT SALES. The Fund may engage in short sales in order to profit from an
anticipated decline in the value of a security. The Fund may also engage in
short sales to attempt to limit its exposure to a possible market decline in the
value of its portfolio securities through short sales of securities which Wright
believes possess volatility characteristics similar to those being hedged. To
effect such a transaction, the Fund must borrow the security sold short to make
delivery to the buyer. The Fund then is obligated to replace the security
borrowed by purchasing it at the market price at the time of replacement. Until
the security is replaced the Fund is required to pay to the lender any accrued
interest or dividends and may be required to pay a premium. The Fund may only
make short sales "against the box," meaning that the Fund either owns the
securities sold short or, by virtue of its ownership of other securities, has
the right to obtain securities equivalent in kind and amount to the securities
sold and, if the right is conditional, the sale is made upon the same
conditions.
The Fund has no current intention of engaging in short sales.
DIVERSIFICATION. The Fund is diversified and therefore may not, with
respect to 75% of its total assets, (1) invest more than 5% of its total assets
in the securities of any one issuers, other than U.S. Government securities, or
(2) acquire more than 10% of the outstanding voting securities of any one
issuer. The Fund will not concentrate (invest 25% or more of its total assets)
in the securities of issuers in any one industry.
FINANCIAL FUTURES CONTRACTS AND RELATED OPTIONS. The Fund does not
currently intend to purchase or sell financial futures contracts or related
options.
ADDITIONAL INFORMATION ABOUT THE TRUST
Unless otherwise defined herein, capitalized terms have the meaning given
them in the Prospectus.
The Trust is an open-end, management investment company organized as a
Massachusetts business trust. The Trust was organized in 1996 and currently has
one series (the Fund). The Fund currently has three classes of shares
outstanding -- Individual Shares, Institutional Shares and Institutional Service
Shares. The Fund is a diversified fund.
The Trust's Declaration of Trust (the "Declaration of Trust") may be
amended with the affirmative vote of a majority of the outstanding shares of the
Trust or, if the interests of a particular class of shares of the Fund are
affected, a majority of the outstanding shares of such class. The trustees are
authorized to make amendments to the Declaration of Trust that do not have a
material adverse effect on the interests of shareholders. The Trust may be
terminated (i) upon the sale of the Trust's assets to another diversified
open-end management investment company, if approved by the holders of two-thirds
of the outstanding shares of the Trust, except that if the trustees recommend
such sale of assets, the approval by the vote of a majority of the Trust's
outstanding shares will be sufficient, or (ii) upon liquidation and distribution
of the assets of the Trust, if approved by a majority of its trustees or by the
vote of a majority of the Trust's outstanding shares. If not so terminated, the
Trust may continue indefinitely.
The Declaration of Trust also provides that the trustees may change the
structure of the Fund from a multiple class fund to a feeder fund in a
master-feeder investment structure without shareholder approval. As a feeder
fund, the Fund would pursue its investment objective by investing all of its
assets in a master fund with an investment objective identical to that of the
Fund. While a master-feeder investment structure may provide opportunities for
growth in the assets of the master fund and economies of scale for the Fund,
duplication of fees may also result. Whenever the Fund as an investor in the
master fund would be requested to vote on matters pertaining to the master fund,
the Fund would hold a meeting of Fund shareholders and vote its interest in the
master fund for or against such matters proportionately to the instructions to
vote for or against such matters received from Fund shareholders. The Fund would
vote shares for which it received no voting instructions in the same proportion
as the shares for which it received voting instructions.
The Declaration of Trust further provides that the trustees will not be
liable for errors of judgment or mistakes of fact or law; however, nothing in
the Declaration of Trust protects a trustee against any liability to which he
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of his
office.
The Trust is an organization of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of such a trust may,
under certain circumstances, be held personally liable as partners for the
obligations of the trust. The Declaration of Trust contains an express
disclaimer of shareholder liability in connection with the Trust property or the
acts, obligations or affairs of the Trust. The Declaration of Trust also
provides for indemnification out of the Trust property of any shareholder held
personally liable for the claims and liabilities to which a shareholder may
become subject by reason of being or having been a shareholder. Thus, the risk
of a shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which the Trust itself would be unable to meet its
obligations. The risk of any shareholder incurring any liability for the
obligations of the Trust is extremely remote.
INVESTMENT RESTRICTIONS
The following investment restrictions have been adopted by the Fund and may
be changed only by the vote of a majority of the Fund's outstanding voting
securities, which as used in this Statement of Additional Information means the
lesser of (a) 67% of the shares of the Fund if the holders of more than 50% of
the shares are present or represented at the meeting or (b) more than 50% of the
shares of the Fund. Accordingly, the Fund may not:
(1) With respect to 75% of the total assets of the Fund, purchase the
securities of any issuer if such purchase at the time thereof would
cause more than 5% of its total assets (taken at market value) to be
invested in the securities of such issuer, or purchase securities of
any issuer if such purchase at the time thereof would cause more than
10% of the total voting securities of such issuer to be held by the
Fund, except obligations issued or guaranteed by the U.S. Government,
its agencies or instrumentalities and except securities of other
investment companies;
(2) Borrow money or issue senior securities except as permitted by the
Investment Company Act of 1940. In addition, the Fund may not issue
bonds, debentures or senior equity securities, other than shares of
beneficial interest;
(3) Purchase securities on margin (but the Fund may obtain such short-term
credits as may be necessary for the clearance of purchase and sales of
securities);
(4) Underwrite or participate in the marketing of securities of others;
(5) Make an investment in any one industry if such investment would cause
investments in such industry to equal or exceed 25% of the Fund's total
assets, at market value at the time of such investment (other than
securities issued or guaranteed by the U.S. Government or its agencies
or instrumentalities);
(6) Purchase or sell real estate, although it may purchase and sell
securities which are secured by real estate and securities of companies
which invest or deal in real estate;
(7) Purchase or sell commodities or commodity contracts for the purchase or
sale of physical commodities, except that the Fund may purchase and
sell financial futures contracts, options on financial futures
contracts and all types of currency contracts; or
(8) Make loans to any person except by (a) the acquisition of debt
securities and making portfolio investments (b) entering into
repurchase agreements or (c) lending portfolio securities.
Notwithstanding the investment policies and restrictions of the Fund, the
Fund may invest its assets in an open-end management investment company with
substantially the same investment objective, policies and restrictions as the
Fund.
The Fund has adopted the following investment policies which may be changed
without approval by the Fund's shareholders. As a matter of nonfundamental
policy, the Fund will not (a) sell or contract to sell any security which it
does not own unless by virtue of its ownership of other securities it has at the
time of sale a right to obtain securities equivalent in kind and amount to the
securities sold and provided that if such right is conditional the sale is made
upon the same conditions; or (b) invest more than 15% of net assets in illiquid
investments.
Except for the Fund's investment policy with respect to borrowing money, if
a percentage restriction contained in the Fund's investment policies is adhered
to at the time of investment, a later increase or decrease in the percentage
resulting from a change in the value of portfolio securities or the Fund's net
assets will not be considered a violation of such restriction.
Trustees, Officers and the Catholic Advisory Board
Trustees and Officers
The trustees and officers of the Trust are listed below. Except as
indicated, each individual has held the office shown or other offices in the
same company for the last five years. Those trustees who are "interested
persons" (as defined in the 1940 Act) of the Trust, Wright, The Winthrop
Corporation ("Winthrop"), Eaton Vance, Eaton Vance's wholly owned subsidiary,
Boston Management and Research ("BMR"), Eaton Vance's parent company, Eaton
Vance Corp. ("EVC"), or Eaton Vance's and BMR's trustee, Eaton Vance, Inc.
("EV") by virtue of their affiliation with either the Trust, Wright, Winthrop,
Eaton Vance, BMR, EVC or EV, are indicated by an asterisk (*).
PETER M. DONOVAN (55), President and Trustee*
President, Chief Executive Officer and Director of Wright and Winthrop; Vice
President, Treasurer and a Director of Wright Investors' Service Distributors,
Inc.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
H. DAY BRIGHAM, JR. (71), Vice President, Secretary and Trustee*
Retired, Vice President, Chairman of the Management Committee and Chief Legal
Officer of Eaton Vance, BMR, EVC and EV and Director of EV and EVC; Director of
Wright and Winthrop since February, 1997.
Address: 92 Reservoir Avenue, Chestnut Hill, MA 02167
JUDITH R. CORCHARD (59) , Vice President and Trustee*
Executive Vice President, Investment Management: Senior Investment Officer;
Chairman of the Investment Committee and Director of Wright and Winthrop. Ms.
Corchard was appointed a Trustee of the Trust on December 10, 1997.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
DORCAS R. HARDY (52), Trustee
President, Dorcas R. Hardy & Associates, an international and domestic public
policy and management firm since 1989, Chairman and Chief Executive Officer of
Work Rcovery, Inc., Tucson, AZ, an advanced rehabilitation technology firm,
1996 to 1998. Ms. Hardy was elected a Trustee on Decenber 9, 1998.
Address: 11407 Stonewall Jackson Drive, Spotsylvania, VA 22553
LELAND MILES (74), Trustee
President Emeritus, University of Bridgeport (1987-present); President,
University of Bridgeport (1974-1987); Director, United Illuminating Company.
Address: 332 North Cedar Road, Fairfield, CT 06430
A.M. MOODY, III (61), Vice President & Trustee*
Senior Vice President, Wright and Winthrop; President, Wright Investors' Service
Distributors, Inc.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
LLOYD F. PIERCE (79), Trustee
Retired Vice Chairman (prior to 1984 - President), People's Bank, Bridgeport,
CT; Member, Board of Trustees, People's Bank, Bridgeport, CT; Board of
Directors, Southern Connecticut Gas Company; Chairman, Board of Directors,
COSINE.
Address: 140 Snow Goose Court, Daytona Beach, FL 32119
RICHARD E. TABER (49), Trustee
Chairman and Chief Executive Officer of First County Bank, Stamford, CT
(1989-present). Mr. Taber was appointed a Trustee of the Trust on March 18,
1997.
Address: 117 Prospect Street, Stamford, CT 06904
RAYMOND VAN HOUTTE (73), Trustee
President Emeritus and Counselor of The Tompkins County Trust Company,
Ithaca, NY (since January 1989); President and Chief Executive Officer, The
Tompkins County Trust Company (1973-1988); President, New York State Bankers
Association (1987-1988); Director, McGraw Housing Company, Inc., Deanco, Inc.,
Evaporated Metal Products and Ithaco, Inc.
Address: One Strawberry Lane, Ithaca, NY 14850
JAMES L. O'CONNOR (53), Treasurer
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
JANET E. SANDERS (62), Assistant Secretary and Assistant Treasurer
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
WILLIAM J. AUSTIN, JR. (46), Assistant Treasurer
Assistant Vice President of Eaton Vance, BMR and EV. Officer of various
investment companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
A. JOHN MURPHY (35), Assistant Secretary
Assistant Vice President of Eaton Vance, BMR and EV since March 1, 1994;
employee of Eaton Vance since March 1993. Officer of various investment
companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
ERIC G. WOODBURY (40), Assistant Secretary
Vice President of Eaton Vance, BMR and EV since February 1993. Officer of
various investment companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
All of the trustees and officers hold identical positions with The Wright
Managed Equity Trust, The Wright Managed Income Trust, The Wright Managed Blue
Chip Series Trust, The Wright EquiFund Equity Trust, and The Wright Blue Chip
Master Portfolio Trust. Each trustee who is not an employee of Wright, Winthrop,
Eaton Vance, its parents or subsidiaries, including Mr. Brigham, receives annual
compensation from the Trust. The trustees who are employees of Wright receive no
compensation from the Trust. Non-affiliated trustees, including Mr. Brigham,
also receive additional payments from other investment companies for which
Wright provides investment advisory services. The Trust does not have a
retirement plan for the trustees. For estimated trustee compensation for the
current fiscal year, see the "Compensation Table" on the next page.
The Trust's board of trustees has established an Independent Trustees'
Committee consisting of all of the Independent Trustees who are Messrs. Emmet,
Miles, Pierce (Chairman), Taber and Van Houtte. The responsibilities of the
Independent Trustees' Committee include those of an audit committee of the
financial governance of the Trust, a nominating committee for additional or
replacement trustees of the Trust and a contract review committee for
consideration of renewals or changes in the investment advisory agreements,
distribution agreements and distribution plans and other agreements as
appropriate.
Catholic Advisory Board
The members of the Catholic Advisory Board and their principal occupations
during the past five years are set forth below. Each of the members of the
Catholic Advisory Board may be contacted at the following address: Catholic
Investment Trust, 24 Federal Street, Boston, Massachusetts 02110.
THOMAS P. MELADY (71), Chairman. Former U.S. Ambassador to Burundi and to the
Holy See, President Emeritus of Sacred Heart University, author of 14 books
and numerous articles.
MARGARET M. HECKLER (66), Eight term Congresswoman from the Massachusetts 10th
District, former Secretary of the Department of Health and Human Services,
former Ambassador to Ireland.
BOWIE K. KUHN (71), former Commissioner of Baseball.
TIMOTHY J. MAY (65), Senior Partner, Patton Boggs, L.L.P.
THOMAS S. MONAGHAN (61), President, CEO and Chairman of the Board of Domino's
Pizza, Inc.
WILLIAM A. WILSON (83), former (and first) U.S. Ambassador to the Holy See.
The members of the Catholic Advisory Board are paid by the Fund. Each
member receives a fee equal to $1,000 per meeting attended plus expenses. The
Trust does not have a retirement plan for the Catholic Advisory Board members.
For estimated Catholic Advisory Board member compensation for the current fiscal
year, see the "Compensation Table" below.
COMPENSATION TABLE
<TABLE>
<CAPTION>
Aggregate Pension or Estimated Total
Compensation Retirement Annual Benefits Compensation
Trustees from the Fund(1) Benefits Accrued Upon Retirement Paid (2)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
H. Day Brigham, Jr. $ None None $
Dorcas R. Hardy $ None None $
Leland Miles $ None None $
Lloyd F. Pierce $ None None $
Richard E. Taber $ None None $
Raymond Van Houtte $ None None $
<FN>
(1 For the Fund's fiscal year ended December 31, 1998.
(2) Total compensation paid is for the year ended December 31, 1998 and
includes service on the then-existing boards in the Wright fund
complex (24 funds).
</FN>
</TABLE>
<TABLE>
<CAPTION>
Catholic Advisory Aggregate Compensation Pension or Retirement Estimated Annual Benefits
Board Member from the Fund(1)(2) Benefits Accrued Upon Retirement
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Thomas P. Melady $ None None
Margaret M. Heckler $ None None
Bowie K. Kuhn $ None None
Timothy J. May $ None None
Thomas S. Monaghan $ None None
William A. Wilson $ None None
<FN>
(1) For the Fund's fiscal year ended December 31, 1998.
(2) For the fiscal year ended December 31, 1998, the Catholic Advisory
Board compensation was paid by Wright.
</FN>
</TABLE>
Control Persons and Principal Holders of Shares
As of ____________, 1999, the trustees and officers of the Trust, and
members of the Catholic Advisory Board as a group, owned in the aggregate ____%
of the outstanding shares of the Fund.
As of ____________, 1999, to the knowledge of the Trust, no other person
owned of record or beneficially 5% or more of the Fund's outstanding Individual
or Institutional Service Shares as of such date.
Investment Advisory and Administrative Services
The Trust has engaged Wright to act as the Fund's investment adviser
pursuant to an Investment Advisory Contract (the "Investment Advisory
Contract"). Wright, acting under the general supervision of the Trust's
trustees, furnishes the Fund with investment advice and management services, as
described below.
Pursuant to the Investment Advisory Contract, Wright will carry out the
investment and reinvestment of the assets of the Fund, will furnish continuously
an investment program with respect to the Fund, will determine which securities
should be purchased, sold or exchanged in consultation with the Catholic
Advisory Board, and will implement such determinations. Wright will be solely
responsible for evaluating the investment merits of the Fund's portfolio
investments. Wright will furnish to the Fund investment advice and management
services, office space, equipment and clerical personnel, and investment
advisory, statistical and research facilities. In addition, Wright has arranged
for certain members of the Eaton Vance and Wright organizations to serve without
salary as officers or trustees. In return for these services, the Fund is
obligated to pay a monthly advisory fee calculated at the rates set forth in the
Fund's current Prospectus.
The following table sets forth the net assets of the Fund at December 31,
1998 and the advisory fees paid by the Fund during the fiscal years ended
December 31, 1998 and 1997.
Aggregate Net Advisory Fees Paid for the Fiscal
Assets of 12/31/98 Years Ended
December 31
- ------------------- -----------------------------------
1998 1997(1)(2)
$ $ $
(1) For the period from May 1, 1997 to December 31, 1997.
(2) To enhance the net income of the Fund, Wright made a reduction of its
advisory fee in the full amount and was allocated a portion of the
expenses related to the operation of the Fund in the amount of $54,873.
Shareholders of the Fund who are also advisory clients of Wright may have
agreed to pay Wright a fee for such advisory services. Wright does not intend to
exclude from the calculation of the investment advisory fees payable to Wright
by such advisory clients the portion of the advisory fee payable by the Fund.
Accordingly, a client may pay an advisory fee to Wright in accordance with
Wright's customary investment advisory fee schedule charged to investment
advisory clients and at the same time, as a shareholder in the Fund, bear its
share of the advisory fee paid by the Fund to Wright as described above.
The Trust has engaged Eaton Vance to act as the Fund's administrator
pursuant to an Administration Agreement. For its services under the
Administration Agreement, Eaton Vance receives monthly administration fees at
the annual rates of X.XX% of the Fund's average net assets.
For the fiscal year ended December 31, 1998, the Fund would have paid an
administration fee equivalent to $_____. Eaton Vance waived the full amount of
the administration fee.
Eaton Vance and EV are both wholly owned subsidiaries of EVC. BMR is a
wholly owned subsidiary of Eaton Vance. Eaton Vance and BMR are both
Massachusetts business trusts, and EV is the trustee of Eaton Vance and BMR. The
Directors of EV are M. Dozier Gardner, James B. Hawkes and Benjamin A. Rowland,
Jr. The Directors of EVC consist of the same persons and John G. L. Cabot, John
M. Nelson, Vincent M. O'Reilly and Ralph Z. Sorenson. Mr. Hawkes is chairman,
president and chief executive officer and Mr. Gardner is vice chairman of EVC,
Eaton Vance, BMR and EV. All of the issued and outstanding shares of Eaton Vance
and of EV are owned by EVC. All of the issued and outstanding shares of BMR are
owned by Eaton Vance. All shares of the outstanding Voting Common Stock of EVC
are deposited in a Voting Trust, the Voting Trustees of which are Messrs.
Gardner, Hawkes and Rowland, and Alan R. Dynner, Thomas E. Faust, Jr., William
M. Steul, and Wharton P. Whitaker. The Voting Trustees have unrestricted voting
rights for the election of Directors of EVC. All of the outstanding voting trust
receipts issued under said Voting Trust are owned by certain of the officers of
Eaton Vance and BMR who are also officers or officers and Directors of EVC and
EV. As of __________, 1999, Messrs. Gardner and Hawkes each owned __% of such
voting trust receipts, Messrs. Rowland and Faust owned __% and __%,
respectively, and Messrs. Dynner, Steul and Whitaker owned _% of such voting
trust receipts. Messrs. Austin, Murphy, O'Connor and Woodbury and Ms. Sanders
are officers of the Trust and are also members of the Eaton Vance, BMR and EV
organizations. Eaton Vance will receive the fees paid under the Administration
Agreement.
Eaton Vance owns all the stock of Northeast Properties, Inc., which is
engaged in real estate investment. EVC owns all of the stock of Fulcrum
Management, Inc. and MinVen, Inc., which are engaged in precious metal mining
venture investment and management. EVC, EV, Eaton Vance and BMR may also enter
into other businesses.
The Fund will be responsible for all of its expenses not expressly stated
to be payable by Wright under its Investment Advisory Contract or by Eaton Vance
under its Administration Agreement, including, without limitation, the fees and
expenses of its custodian and transfer agent, including those incurred for
determining the Fund's net asset value and keeping the Fund's books; the cost of
share certificates; membership dues to investment company organizations;
brokerage commissions and fees; fees and expenses of registering its shares;
expenses of reports to shareholders, proxy statements, and other expenses of
shareholders' meetings; insurance premiums; printing and mailing expenses;
interest, taxes and corporate fees; legal and accounting expenses; expenses of
trustees not affiliated with Eaton Vance or Wright; distribution expenses
incurred pursuant to the Fund's distribution plan (if any); and investment
advisory and administration fees. The Fund will also bear expenses incurred in
connection with litigation in which the Fund is a party and the legal obligation
the Fund may have to indemnify the officers and trustees of the Trust with
respect thereto.
The Fund's Investment Advisory Contract and Administration Agreement will
remain in effect until February 28, 2000. The Investment Advisory Contract may
be continued from year to year thereafter so long as such continuance after
February 28, 2000 is approved at least annually (i) by the vote of a majority of
the trustees who are not "interested persons" of the Trust, Eaton Vance or
Wright cast in person at a meeting specifically called for the purpose of voting
on such approval and (ii) by the board of trustees of the Trust or by vote of a
majority of the outstanding shares of the Fund. The Fund's Administration
Agreement may be continued from year to year after February 28, 2000 so long as
such continuance is approved annually by the vote of a majority of the trustees.
Each agreement may be terminated at any time without penalty on sixty (60) days
written notice by the board of trustees or directors of either party, or by vote
of the majority of the outstanding shares of the Fund. Each agreement will
terminate automatically in the event of its assignment. Each agreement provides
that, in the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of its obligations or duties to the Fund under such agreement
on the part of Eaton Vance or Wright, Eaton Vance or Wright will not be liable
to the Fund for any loss incurred.
Custodian
IBT, 200 Clarendon Street, Boston, MA 02116, acts as custodian for the
Fund. IBT has the custody of all cash and securities of the Fund, maintains the
Fund's general ledgers and computes the daily net asset value per share. In such
capacity it attends to details in connection with the sale, exchange,
substitution, transfer or other dealings with the Fund's investments, receives
and disburses all funds and performs various other ministerial duties upon
receipt of proper instructions from the Fund.
Independent Certified Public Accountants
, 125 Summer Street, Boston, MA 02110-1617, is the
Fund's independent certified public accountant, providing audit services, tax
return preparation, and assistance and consultation with respect to the
preparation of filings with the Securities and Exchange Commission.
Brokerage Allocation
Wright places the portfolio security transactions for the Fund, which in
some cases may be effected in block transactions which include other accounts
managed by Wright. Wright provides similar services directly for bank trust
departments and other investment advisory accounts. Wright seeks to execute
portfolio security transactions on the most favorable terms and in the most
effective manner possible. In seeking best execution, Wright will use its best
judgment in evaluating the terms of a transaction, and will give consideration
to various relevant factors, including without limitation the size and type of
the transaction, the nature and character of the markets for the security, the
confidentiality, speed and certainty of effective execution required for the
transaction, the reputation, experience and financial condition of the
broker-dealer and the value and quality of service rendered by the broker-dealer
in other transactions, and the reasonableness of the brokerage commission or
markup, if any.
It is expected that on frequent occasions there will be many broker-dealer
firms which will meet the foregoing criteria for a particular transaction. In
selecting among such firms, the Fund may give consideration to those firms which
supply brokerage and research services, quotations and statistical and other
information to Wright for its use in servicing its advisory accounts. The Fund
may include firms which purchase investment services from Wright. The term
"brokerage and research services" includes advice as to the value of securities,
the advisability of investing in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and the performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). Such services and information may be useful
and of value to Wright in servicing all or less than all of its accounts and the
services and information furnished by a particular firm may not necessarily be
used in connection with the account which paid brokerage commissions to such
firm. The advisory fee paid by the Fund to Wright is not reduced as a
consequence of Wright's receipt of such services and information. While such
services and information are not expected to reduce Wright's normal research
activities and expenses, Wright would, through use of such services and
information, avoid the additional expenses which would be incurred if it should
attempt to develop comparable services and information through its own staff.
From the start of business, May 1, 1997 to December 31, 1997, the Fund paid
aggregate brokerage commissions of $16,144 on portfolio transactions. For the
fiscal year ended December 31, 1998, the Fund paid aggregate brokerage
commissions of $____________ on portfolio transactions.
Subject to the requirement that Wright shall use its best efforts to seek
to execute the Fund's portfolio security transactions at advantageous prices and
at reasonably competitive commission rates, Wright, as indicated above, is
authorized to consider as a factor in the selection of any broker-dealer firm
with whom the Fund's portfolio orders may be placed the fact that such firm has
sold or is selling shares of the Fund or of other investment companies sponsored
by Wright. This policy is consistent with a rule of the National Association of
Securities Dealers, Inc., which rule provides that no firm which is a member of
the Association shall favor or disfavor the distribution of shares of any
particular investment company or group of investment companies on the basis of
brokerage commissions received or expected by such firm from any source.
Under the Fund's Investment Advisory Contract, Wright has the authority to
pay commissions on portfolio transactions for brokerage and research services
exceeding that which other brokers or dealers might charge provided certain
conditions are met. This authority will not be exercised, however, until the
Prospectus or this Statement of Additional Information has been supplemented or
amended to disclose the conditions under which Wright proposes to do so.
The Investment Advisory Contract expressly recognizes the practices which
are provided for in Section 28(e) of the Securities Exchange Act of 1934 by
authorizing the selection of a broker or dealer which charges the Fund a
commission which is in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if it is determined in
good faith that such commission was reasonable in relation to the value of the
brokerage and research services which have been provided.
Pricing of Shares
For a description of how the Fund values its shares, see "Information About
Your Account - Determining Share Price [NAV]" in the Fund's current Prospectus.
The Fund values securities with a remaining maturity of 60 days or less by the
amortized cost method. The amortized cost method involves initially valuing a
security at its cost (or its fair market value on the sixty-first day prior to
maturity) and thereafter assuming a constant amortization to maturity of any
discount or premium, without regard to unrealized appreciation or depreciation
in the market value of the security.
The Fund will not price its securities on the following national holidays:
New Year's Day; Martin Luther King, Jr. Day; Presidents' Day; Good Friday;
Memorial Day; Independence Day; Labor Day; Thanksgiving Day; and Christmas Day.
Principal Underwriter
The Fund has adopted a Distribution Plan as defined in Rule 12b-1 under the
1940 Act (the "Plan") with respect to its Individual Shares and its
Institutional Service Shares. The Plan specifically authorizes the Fund to pay
direct and indirect expenses incurred by any separate distributor or
distributors under agreement with the Fund in activities primarily intended to
result in the sale of its Individual Shares and Institutional Service Shares.
The expenses of these activities will not exceed 0.75% per annum of the Fund's
average daily net assets attributable to Individual Shares and 0.25% per annum
of the Fund's average daily net assets attributable to Institutional Service
Shares. Payments under the Plan are reflected as an expense in the Fund's
financial statements relating to the applicable class of shares.
The Trust has entered into a distribution contract with the principal
underwriter. This contract provides for WISDI to act as a separate distributor
of the Fund's shares.
The Fund will pay per annum 0.75% of its average daily net assets
attributable to Individual Shares and 0.25% of its average daily net assets
attributable to Institutional Service Shares to WISDI for distribution
activities on behalf of the Fund in connection with the sale of its Individual
Shares and Institutional Service Shares, respectively. WISDI will provide on a
quarterly basis documentation concerning the expenses of such activities.
Documented expenses of the Fund will include compensation paid to and
out-of-pocket disbursements of officers, employees or sales representatives of
WISDI, including telephone costs, the printing of prospectuses and reports for
other than existing shareholders, preparation and distribution of sales
literature, advertising and interest or other financing charges. If the
distribution payments to WISDI exceed its expenses, WISDI may realize a profit
from these arrangements. Peter M. Donovan, President and a trustee of the Trust
and President, Chief Executive Officer and a Director of Wright and Winthrop, is
Vice President, Treasurer and a Director of WISDI. A.M. Moody, III, Vice
President and a trustee of the Trust and Senior Vice President of Wright and
Winthrop, is President and a Director of WISDI.
It is the opinion of the trustees and officers of the Trust that the
following are not expenses primarily intended to result in the sale of
Individual Shares or Institutional Service Shares issued by the Fund: fees and
expenses of registering these shares under federal or state laws regulating the
sale of securities; fees and expenses of registering the Trust as a
broker-dealer or of registering an agent of the Trust under federal or state
laws regulating the sale of securities; and fees and expenses of preparing and
setting in type the Trust's registration statement under the Securities Act of
1933. Should such expenses be deemed by a court or agency having jurisdiction to
be expenses primarily intended to result in the sale of these shares, they will
be considered to be expenses contemplated by and included in the Plan, but not
subject to the 0.75% or 0.25% per annum limitations described above.
Under the Plan, the President or Vice President of the Trust will provide
to the trustees for their review, and the trustees will review at least
quarterly, a written report of the amounts expended under the Plan and the
purposes for which such expenditures were made.
The following table shows the fee payable to WISDI under the Plan and the
amount of such fee actually paid by each class during the fiscal year ended
December 31, 1998.
<TABLE>
<CAPTION>
Distribution Distribution Expenses Distribution Distribution Expenses
Expenses Reduced by the Expenses Paid as a % of Fund's
Class Allowable Principal Underwriter Paid by Fund Average Net Asset Value
- ----- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Individual Shares $ $ $ %
Institutional Service Shares %
</TABLE>
For the fiscal year ended December 31, 1998, it is estimated that WISDI
spent approximately the following amounts on behalf of the Catholic Values
Investment Trust.
Wright Investors' Service Distributors, Inc.
Financial Summaries for the year ended December 31, 1998
<TABLE>
<CAPTION>
Printing & Mailing Travel & Commissions & Administration
Class Promotional Prospectuses Entertainment Service Fees and Other TOTAL
- ----- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Individual Shares $ $ $ $ $ $
Institutional Service Shares
</TABLE>
The Plan was adopted by the Trustees on January 22, 1997. Under its terms,
the Plan remains in effect from year to year, provided such continuance is
approved annually by a vote of the Trust's trustees, including a majority of 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. The Plan may not be
amended to increase materially the amount to be spent by the Individual Shares
or Institutional Service Shares for the services described therein without
approval of a majority of the outstanding Individual Shares or Institutional
Service Shares, respectively. All material amendments of the Plans must also be
approved by the trustees of the Trust in the manner described above. The Plan
may be terminated as to the Individual Shares or the Institutional Service
Shares at any time without payment of any penalty by vote of a majority of the
trustees of the Trust who are not interested persons of the Trust and who have
no direct or indirect financial interest in the operation of the Plan or by a
vote of a majority of the outstanding Individual Shares or Institutional Service
Shares, respectively. If the Plan is terminated, the Fund would stop paying the
distribution fee and the trustees would consider other methods of financing the
distribution of the Fund's Individual Shares or Institutional Service Shares, as
appropriate.
So long as the Plan is in effect, the selection and nomination of trustees
who are not interested persons of the Trust shall be committed to the discretion
of the trustees who are not such interested persons. The trustees of the Trust
have determined that in their judgment there is a reasonable likelihood that the
Plan will benefit the Fund and the holders of Individual Shares and
Institutional Service Shares.
Service Plan
The Service Plan was adopted by the trustees on January 22, 1997 and will
continue in effect from year to year, provided such continuance is approved
annually by a vote of the Trust's trustees, including a majority of the trustees
who are not interested persons of the Trust and who have no direct or indirect
financial interest in the operation of the Service Plan. The Service Plan may be
terminated at any time without payment of any penalty by vote of a majority of
the trustees of the Trust who are not interested persons of the Trust and who
have no direct or indirect financial interest in the operation of the Service
Plan. The trustees of the Trust have determined that in their judgment there is
a reasonable likelihood that the Service Plan will benefit the Fund and its
shareholders.
For the fiscal year ended December 31, 1998, the Fund paid service fees of
$____________ to _________.
Taxes
For additional information regarding federal and state taxes see "Taxes" in
the Fund's current Prospectus.
In order to avoid federal excise tax, the Code requires that the Fund
distribute (or be deemed to have distributed) by December 31 of each calendar
year at least 98% of its ordinary income for such year, at least 98% of the
excess of its realized capital gains over its realized capital losses (computed
on the basis of the one-year period ending on October 31 of such year, after
reduction by any available capital loss carryforwards) and 100% of any income
and capital gains from the prior year (as previously computed) that was not paid
out during such year and on which the Fund paid no federal income tax.
The Fund may be subject to foreign withholding or other foreign taxes with
respect to income (possibly including, in some cases, capital gains) derived
from securities of foreign issuers. These taxes may in some cases be reduced or
eliminated under the terms of an applicable U.S. income tax treaty. Certain
foreign exchange gains and losses realized by the Fund may be treated as
ordinary income and losses. Certain uses of foreign currency and related
derivatives and investments by the Fund in the stock of certain "passive foreign
investment companies" may be limited or in the latter case a tax election may be
made, if available, in order to avoid imposition of tax on the Fund.
A portion of the Fund's distributions of net investment income which are
derived from dividends the Fund receives from U.S. corporations may qualify for
the dividends-received deduction for corporations. The dividends-received
deduction is reduced to the extent the shares with respect to which the
dividends are received are treated as debt-financed under the Code and is
eliminated if the shares are deemed to have been held for less than a minimum
period, generally 46 days, which must be satisfied over a prescribed period
immediately before or after the shares become ex-dividend. Receipt of
distributions qualifying for the deduction may result in liability for the
corporate alternative minimum tax and/or, for "extraordinary dividends,"
reduction of the tax basis (possibly requiring current recognition of income to
the extent such basis would otherwise be reduced below zero) of the corporate
shareholder's shares.
As a result of federal tax legislation enacted on August 5, 1997 (H.R.
2014, the Taxpayer Relief Act of 1997 (the "1997 TRA")), gain recognized after
May 6, 1997 from the sale of a capital asset is taxable to individual
(noncorporate) investors at different maximum federal income tax rates,
depending generally upon the tax holding period for the asset, the federal
income tax bracket of the taxpayer, and the dates the asset was acquired and/or
sold. The Treasury Department has issued guidance under the 1997 TRA that
enables the Fund to pass through to its shareholders the benefits of the capital
gains tax rates enacted in the 1997 TRA. The Fund will provide appropriate
information to its shareholders regarding the tax rate(s) applicable to its
distributions from its net capital gain, if any, in accordance with this and any
future guidance. Shareholders should consult their own tax advisers on the
correct application of these new rules in their particular circumstances.
Redemptions (including exchanges) and other dispositions of Fund shares in
transactions that are treated as sales for tax purposes will generally result in
the recognition of taxable gain or loss by shareholders that are subject to tax.
Shareholders should consult their own tax advisers with reference to their
individual circumstances to determine whether any particular redemption,
exchange or other disposition of Fund shares is properly treated as a sale for
tax purposes, as this discussion assumes. Any loss realized upon the redemption,
exchange or other sale of shares of the Fund with a tax holding period of six
months or less will be treated as a long-term capital loss to the extent of any
distributions of long-term capital gains designated as capital gain dividends
with respect to such shares. All or a portion of a loss realized upon the
redemption, exchange or other sale of Fund shares may be disallowed under "wash
sale" rules to the extent shares of the Fund are purchased (including shares
acquired by means of reinvested dividends) within the period beginning 30 days
before and ending 30 days after the date of such redemption, exchange or other
sale.
It should be noted that future Treasury Department regulations or other
pronouncements that may be issued pursuant to regulatory authority contained in
the provisions of the 1997 TRA that affect the taxation of capital gains (as
described above) may prescribe rules that modify some of the provisions
described above.
The Fund may follow the accounting practice known as equalization, which
could affect the amount, timing and character of its distributions to
shareholders.
Distributions made by the Fund will generally be subject to state and
local income taxes. A state income (and possibly local income and/or intangible
property) tax exemption may be available to the extent, if any, the Fund's
distributions are derived from interest on (or, in the case of intangible
property taxes, the value of its assets is attributable to) certain U.S.
Government obligations, provided in some states that certain thresholds for
holdings of such obligations and/or reporting requirements are satisfied. The
Fund does not intend to seek to meet any such thresholds or requirements.
Special tax rules apply to IRA accounts (including penalties on certain
distributions and other transactions) and to other special classes of investors,
such as tax-exempt organizations, banks or insurance companies. Investors should
consult their tax advisers for more information.
Calculation of Performance and Yield Quotations
The average annual total return of the Fund is determined for a particular
period by calculating the actual dollar amount of investment return on a $1,000
investment in the Fund made at the maximum public offering price (i.e. net asset
value) at the beginning of the period, and then calculating the annual
compounded rate of return which would produce that amount. Total return for a
period of one year is equal to the actual return of the Fund during that period.
This calculation assumes that all dividends and distributions are reinvested at
net asset value on the reinvestment dates during the period and that, with
respect to Individual Shares, the CDSC is applied at the end of the period.
Because each class of shares has its own fee structure and the Individual Shares
class has a CDSC, the classes will have different performance results.
The yield of the Fund is computed by dividing its net investment income
per share earned during a recent 30-day period by the maximum offering price
(i.e. net asset value) per share on the last day of the period and annualizing
the resulting figure. Net investment income per share is equal to the Fund's
dividends and interest earned during the period, with the resulting number being
divided by the average daily number of shares outstanding and entitled to
receive dividends during the period.
The Fund's yield is calculated according to the following formula:
6
Yield = 2 [ ( a-b + 1) - 1 ]
---
cd
Where:
a = dividends and interest earned during the period.
b = expenses accrued for the period (after reductions).
c = the average daily number of shares outstanding during the period.
d = the maximum offering price per share on the last day of the period.
Yield and effective yield will be based on historical earnings and are not
intended to indicate future performance. Yield and effective yield will vary
based on changes in market conditions and the level of expenses. The Fund's
yield or total return may be compared to the Consumer Price Index and various
domestic securities indices. The Fund's yield or total return and comparisons
with these indices may be used in advertisements and in information furnished to
present or prospective shareholders.
From time to time, in advertisements, in sales literature, or in reports to
shareholders, the past performance of the Fund may be illustrated and/or
compared with that of other mutual funds with similar investment objectives, and
to stock or other relevant indices. In addition, the performance of the Fund may
be compared to alternative investment or savings vehicles and/or to indexes or
indicators of economic activity, e.g., inflation or interest rates. Performance
rankings and listings reported in newspapers or national business and financial
publications, such as Barron's, Business Week, Consumers Digest, Consumer
Reports, Financial World, Forbes, Fortune, Investors Business Daily, Kiplinger's
Personal Finance Magazine, Money Magazine, New York Times, Smart Money, USA
Today, U.S. News and World Report, The Wall Street Journal and Worth may also be
cited (if the Fund is listed in any such publication) or used for comparison, as
well as performance listings and rankings from various other sources including
Bloomberg Financial Markets, CDA/Wiesenberger, Donoghue's Mutual Fund Almanac,
Investment Company Data, Inc., Johnson's Charts, Kanon Bloch Carre and Co.,
Lipper Analytical Services, Inc., Micropal, Inc., Morningstar, Inc., Schabacker
Investment Management and Towers Data Systems, Inc.
The average annual total return for the Fund for the fiscal year ended
December 31, 1998 was _____% for the Individual Share Class and _____% for the
Institutional Service Share Class.
In addition, from time to time quotations from articles from financial
publications such as those listed above may be used in advertisements, in sales
literature, or in reports to shareholders of the Fund.
Financial Statements
The audited financial statements of, and the independant auditors' report
for the fund appear in the Fund's most recent annual report to shareholders and
are incorporated by reference into this Statement of Additional Information. A
copy of the annual report is attached to this Statement of Additional
Information.
<PAGE>
APPENDIX
- -------------------------------------------------------------------------------
Wright Quality Ratings
Wright Quality Ratings provide the means by which the fundamental criteria
for the measurement of quality of an issuer's securities can be objectively
evaluated.
Each rating is based on 32 individual measures of quality grouped into four
components: (1) Investment Acceptance, (2) Financial Strength, (3) Profitability
and Stability, and (4) Growth. The total rating is three letters and a numeral.
The three letters measure (1) Investment Acceptance, (2) Financial Strength, and
(3) Profitability and Stability. Each letter reflects a composite measurement of
eight individual standards which are summarized as A: Outstanding, B: Excellent,
C: Good, D: Fair, L: Limited, and N: Not Rated. The numeral rating reflects
Growth and is a composite of eight individual standards ranging from 0 to 20.
EQUITY SECURITIES
INVESTMENT ACCEPTANCE reflects the acceptability of a security by and its
marketability among investors, and the adequacy of the floating supply of its
common shares for the investment of substantial funds.
FINANCIAL STRENGTH represents the amount, adequacy and liquidity of the
corporation's resources in relation to current and potential requirements. Its
principal components are aggregate equity and total capital, the ratio of
invested equity capital to debt, the adequacy of net working capital, its fixed
charges coverage ratio and other appropriate criteria.
PROFITABILITY AND STABILITY measures the record of a corporation's
management in terms of (1) the rate and consistency of the net return on
shareholders' equity capital investment at corporate book value, and (2) the
profits or losses of the corporation during generally adverse economic periods,
including its ability to withstand adverse financial developments.
GROWTH per common share of the corporation's equity capital, earnings, and
dividends -- rather than the corporation's overall growth of dollar sales and
income.
These ratings are determined by specific quantitative formulae. A
distinguishing characteristic of these ratings is that The Wright Investment
Committee must review and accept each rating. The Committee may reduce a
computed rating of any company, but may not increase it.
DEBT SECURITIES
Wright ratings for commercial paper, corporate bonds and bank certificates
of deposit consist of the two central positions of the four position
alphanumeric corporate equity rating. The two central positions represent those
factors which are most applicable to fixed income and reserve investments. The
first, Financial Strength, represents the amount, the adequacy and the liquidity
of the corporation's resources in relation to current and potential
requirements. Its principal components are aggregate equity and total capital,
the ratios of (a) invested equity capital, and (b) long-term debt, total of
corporate capital, the adequacy of net working capital, fixed charges coverage
ratio and other appropriate criteria. The second letter represents Profitability
and Stability and measures the record of a corporation's management in terms of:
(a) the rate and consistency of the net return on shareholders' equity capital
investment at corporate book value, and (b) the profits and losses of the
corporation during generally adverse economic periods, and its ability to
withstand adverse financial developments.
The first letter rating of the Wright four-part alphanumeric corporate
rating is not included in the ratings of fixed-income securities since it
primarily reflects the adequacy of the floating supply of the company's common
shares for the investment of substantial funds. The numeric growth rating is not
included because this element is identified only with equity investments.
<PAGE>
A-1 AND P-1 COMMERCIAL PAPER RATINGS
BY S&P AND MOODY'S
An S&P Commercial Paper Rating is a current assessment of the likelihood of
timely payment of debt having an original maturity of no more than 365 days.
`A': Issues assigned this highest rating are regarded as having the
greatest capacity for timely payment. Issues in this category are delineated
with the numbers 1, 2, and 3 to indicate the relative degree of safety. The
`A-1' designation indicates that the degree of safety regarding timely payment
is either overwhelming or very strong. Those issues determined to possess
overwhelming safety characteristics will be denoted with a plus (+) sign
designation.
The commercial paper rating is not a recommendation to purchase or sell a
security. The ratings are based on current information furnished to S&P by the
issuer or obtained from other sources it considers reliable. The ratings may be
changed, suspended or withdrawn as a result of changes in or unavailability of
such information.
Issuers (or related supporting institutions) rated P-1 by Moody's have a
superior capacity for repayment of short-term promissory obligations. P-1
repayment capacity will normally be evidenced by the following characteristics:
-- Leading market positions in well-established industries.
-- High rates of return on funds employed.
-- Conservative capitalization structures with moderate reliance on debt
and ample asset protection.
-- Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.
-- Well-established access to a range of financial markets and assured
sources of alternate liquidity.
Bond Ratings
In addition to Wright quality ratings, bonds or bond insurers may be
expected to have credit risk ratings assigned by the two major rating companies,
Moody's and S&P. Moody's uses a nine-symbol system with Aaa being the highest
rating and C the lowest. S&P uses a 10-symbol system that ranges from AAA to D.
Bonds within the top four categories of Moody's (Aaa, Aa, A and Baa) and of S&P
(AAA, AA, A and BBB) are considered to be of investment-grade quality. Note that
both S&P and Moody's currently give their highest rating to issuers insured by
the American Municipal Bond Assurance Corporation (AMBAC) or by the Municipal
Bond Investors Assurance Corporation (MBIA).
Bonds rated A by S&P have a strong capacity to pay principal and interest,
although they are somewhat more susceptible to the adverse effects of change in
circumstances and economic conditions than debt in higher-rated categories. The
rating of AA is accorded to issues where the capacity to pay principal and
interest is very strong and they differ from AAA issues only in small degree.
The AAA rating indicates an extremely strong capacity to pay principal and
interest.
Bonds rated A by Moody's are judged by Moody's to possess many favorable
investment attributes and are considered as upper medium grade obligations.
Bonds rated Aa by Moody's are judged by Moody's to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known as
high-grade bonds. They are rated lower than Aaa bonds because margins of
protection may not be as large or fluctuations of protective elements may be of
greater degree or there may be other elements present which make the long-term
risks appear somewhat larger. Bonds rated Aaa by Moody's are judged to be of the
best quality. Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issuers.
NOTE RATINGS
In addition to Wright quality ratings, municipal notes and other short-term
loans may be assigned ratings by Moody's or S&P.
Moody's ratings for municipal notes and other short-term loans are
designated Moody's Investment Grade (MIG). This distinction is in recognition of
the differences between short-term and long-term credit risk. Loans bearing the
designation MIG 1 are of the best quality, enjoying strong protection by
establishing cash flows of funds for their servicing or by established and
broad-based access to the market for refinancing, or both. Loans bearing the
designation MIG 2 are of high quality, with margins of protection ample although
not so large as in the preceding group.
S&P's top ratings for municipal notes issued after July 29, 1984 are SP-1
and SP-2. the designation SP-1 indicates a very strong capacity to pay principal
and interest. A "+" is added for those issues determined to possess overwhelming
safety characteristics. An "SP-2" designation indicates a satisfactory capacity
to pay principal and interest.
<PAGE>
PART C
===============================================================================
Other Information
Item 23. Exhibits
(a) (1) Declaration of Trust dated November 25, 1996 filed as Exhibit
(1) to the Registration Statement filed on December 2,
1996 and incorporated herein by reference.
(2) Amendment dated February 24, 1997 to the Declaration of Trust
filed as Exhibit (1)(b) to Post-Effective Amendment No. 2
filed on September 10, 1997 and incorporated herein by
reference.
(b) By-Laws filed as Exhibit (2) to Pre-Effective Amendment No. 1
filed on February 24, 1997 and incorporated herein by
reference.
(c) Not Applicable
(d) (1) Investment Advisory Contract with Wright Investors' Service,
Inc.dated September 23, 1998 filed herewith as Exhibit(d)(1).
(2) Amended and Restated Administration Agreement with Eaton Vance
Management dated February 1, 1998 filed as Exhibit (5)(b) to
Post-Effective Amendment No. 24 filed April 30, 1998 and
incorporated herein by reference.
(e) Distribution Contract between the Fund and Wright Investors'
Service Distributors, Inc. dated March 10, 1997 filed as Exhibit
(6) to Post-Effective Amendment No. 2 filed on September 10, 1997
and incorporated herein by reference.
(f) Not Applicable
(g) (1) Master Custodian Agreement between Wright Managed
Investment Funds and Investors Bank & Trust Company adopted
March 10, 1997 filed as Exhibit (8) to Post-Effective
Amendment No. 2 filed on September 10, 1997 and incorporated
herein by reference.
(2) Amendment dated September 24, 1997 to Master Custodian
Agreement fild herewith as Exhibit (g)(2).
(h) Not Applicable
(i) Opinion of Counsel dated April 7, 1998 filed as Exhibit 10 to
Post-Effective Amendment No. 3 and incorporated herein by
reference.
(j) Not Applicable
(k) Not Applicable
(l) Share Purchase Agreement dated January 31, 1997 filed as Exhibit
(13) to Pre-Effective Amendment No.1 filed on February 24, 1997
and incorporated herein by reference.
(m) (1) Distribution Plan pursuant to Rule 12b-1 under the
Investment Company Act of 1940 dated March 10, 1997 filed as
Exhibit (15)(a) to Post-Effective Amendment No. 2 filed on
September 10, 1997 and incorporated herein by reference.
(2) Service Plan dated March 10, 1997 filed as Exhibit (15)(b) to
Post-Effective Amendment No. 2 filed on September 10,
1997 and incorporated herein by reference.
(n) To be filed by Amendment.
(o) Multiple Class Plan pursuant to Rule 18f-3 dated March 10, 1997
filed as Exhibit (18) to Post-Effective Amendment No. 2
filed on September 10, 1997 and incorporated herein by reference.
(p) (1) Power of Attorney dated March 26, 1998 filed as Exhibit 17(a)
to Post-Effective Amendment No. 4 filed April 30, 1998
and incorporated herein by reference.
(2) Power of Attorney dated December 9, 1998 filed herewith as
Exhibit (p)(2).
Item 24. Persons Controlled by or under Common Control with Registrant
Not Applicable.
<PAGE>
Item 25. Indemnification
The Registrant's By-Laws filed as Exhibit (2) to Pre-Effective Amendment No. 1
contain provisions limiting the liability, and providing for indemnification, of
the Trustees and officers under certain circumstances.
The Registrant's Trustees and officers are insured under a standard investment
company errors and omissions insurance policy covering loss incurred by reasons
of negligent errors and omissions committed in their capacities as such.
Item 26. Business and Other Connections of Investment Adviser
Reference is made to the information set forth under the captions "Officers and
Trustees" and "Investment Advisory and Administrative Services" in the Statement
of Additional Information, which information is incorporated herein by
reference.
Item 27. Principal Underwriter
(a) Wright Investors' Service Distributors, Inc. (a wholly-owned
subsidiary of The Winthrop Corporation) acts as principal
underwriter for each of the investment companies named below.
Catholic Values Investment Trust
The Wright Managed Blue Chip Series Trust
The Wright EquiFund Equity Trust
The Wright Managed Equity Trust
The Wright Managed Income Trust
<TABLE>
<CAPTION>
(b) (1) (2) (3)
Name and Principal Positions and Officers Positions and Offices
Business Address with Principal Underwriter with Registrant
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
A. M. Moody III* President Vice President and Trustee
Peter M. Donovan* Vice President and Treasurer President and Trustee
Vincent M. Simko* Vice President and Secretary None
- -------------------------------------------------------------------------------------------------------------------------------
* Address is 1000 Lafayette Boulevard, Bridgeport, Connecticut 06604
</TABLE>
(c) Not Applicable.
Item 28. Location of Accounts and Records
All applicable accounts, books and documents required to be maintained by the
Registrant by Section 31(a) of the Investment Company Act of 1940 and the Rules
promulgated thereunder are in the possession and custody of the registrant's
custodian, Investors Bank & Trust Company, 200 Clarendon Street, Boston, MA
02116, and its transfer agent, First Data Investor Services Group, 4400 Computer
Drive, Westborough, MA 01581-5123, with the exception of certain corporate
documents and portfolio trading documents which are either in the possession and
custody of the Registrant's administrator, Eaton Vance Management, 24 Federal
Street, Boston, MA 02110 or of the investment adviser, Wright Investors'
Service, Inc., 1000 Lafayette Boulevard, Bridgeport, CT 06604. Registrant is
informed that all applicable accounts, books and documents required to be
maintained by registered investment advisers are in the custody and possession
of the Registrant's administrator, Eaton Vance Management, or of the investment
adviser, Wright Investors' Service, Inc.
Item 29. Management Services
Not Applicable.
<PAGE>
Item 30. Undertakings
(a) The Registrant undertakes to furnish to each person to whom a
prospectus is delivered a copy of the latest annual report to
shareholders, upon request and without charge.
(b) The Registrant undertakes to assist shareholders seeking to remove a
trustee(s) of the Registrant in the manner set forth in Section 16(c)
of the Investment Company Act of 1940.
<PAGE>
Signatures
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Bridgeport, and the State of Connecticut on the
_____ day of February, 1999.
CATHOLIC VALUES INVESTMENT TRUST
By: Peter M. Donovan*
--------------------------------
Peter M. Donovan, Vice President
Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment to the Registration Statement has been signed by the following persons
in the capacities and on the _____ day of February, 1999.
SIGNATURE TITLE
- -------------------------------------------------------------------------------
Peter M. Donovan* President, Principal
- ----------------- Executive Officer & Trustee
Peter M. Donovan
James L. O'Connor* Treasurer, Principal
- ------------------- Financial and Accounting Officer
James L. O'Connor
H. Day Brigham, Jr.* Trustee
- --------------------
H. Day Brigham, Jr.
Judith R. Corchard* Trustee
- --------------------
Judith R. Corchard
Dorcas R. Hardy* Trustee
- --------------------
Dorcas R. Hardy
Leland Miles* Trustee
- --------------------
Leland Miles
A. M. Moody III* Trustee
- --------------------
A. M. Moody III
Lloyd F. Pierce* Trustee
- --------------------
Lloyd F. Pierce
Richard E. Taber* Trustee
- --------------------
Richard E. Taber
Raymond Van Houtte* Trustee
- --------------------
Raymond Van Houtte
*By: /s/ A. M. Moody III
- ----------------------------
A. M. Moody III
Attorney-in-Fact
<PAGE>
Exhibit Index
The following Exhibits are filed as part of this Amendment to the
Registration Statement pursuant to Rule 483 of Regulation C.
Exhibit No. Description
- ------------------------------------------------------------------------------
(d) (1) Investment Advisory Contract dated September 23, 1998 with
Wright Investors' Service, Inc.
(g) (2) Amendment dated September 24, 1997 to Master Custodian Agreement.
(p) (2) Power of Attorney dated December 9, 1998.
INVESTMENT ADVISORY CONTRACT
CONTRACT made this 23rd day of September 1998, between each of THE
WRIGHT MANAGED EQUITY TRUST, THE WRIGHT MANAGED INCOME TRUST, THE WRIGHT
EQUIFUND EQUITY TRUST, CATHOLIC VALUES INVESTMENT TRUST and THE WRIGHT MANAGED
BLUE CHIP SERIES TRUST, each a Massachusetts business trust (the "Trusts"), on
behalf of each series of the Trusts which the Adviser (defined below) and the
Trusts shall agree from time to time are subject to this Contract, as set forth
on Schedule A (collectively, the "Funds" and individually, the "Fund"), and
WRIGHT INVESTORS' SERVICE, INC., a Connecticut corporation (the "Adviser"):
1. DUTIES OF THE ADVISER. Each Trust hereby employs the Adviser to act as
investment adviser for and to manage the investment and reinvestment of the
assets of the Funds and, except as otherwise provided in an administration
agreement, to administer the Trust's affairs, subject to the supervision of the
Trustees of the Trust, for the period and on the terms set forth in this
Contract.
The Adviser hereby accepts such employment, and undertakes to afford to
each Trust the advice and assistance of the Adviser's organization in the choice
of investments and in the purchase and sale of securities for each Fund and to
furnish for the use of the Trust office space and all necessary office
facilities, equipment and personnel for servicing the investments of the Funds
and for administering the Trust's affairs and to pay the salaries and fees of
all officers and Trustees of the Trust who are employees of the Adviser's
organization and all personnel of the Adviser performing services relating to
research and investment activities. The Adviser shall for all purposes herein be
deemed to be an independent contractor and shall, except as otherwise expressly
provided or authorized, have no authority to act for or represent any Trust in
any way or otherwise be deemed an agent of the Trust.
The Adviser shall provide each Trust with such investment management and
supervision as the Trust may from time to time consider necessary for the proper
supervision of its funds. As investment adviser to the Funds, the Adviser shall
furnish continuously an investment program and shall determine from time to time
what securities shall be purchased, sold or exchanged and what portion of each
Fund's assets shall be held uninvested, subject always to the applicable
restrictions of the Trust's Declaration of Trust, By-Laws and registration
statement under the Securities Act of 1933 and the Investment Company Act of
1940, all as from time to time amended. The Adviser is authorized, in its
discretion and without prior consultation with the Trust, but subject to each
Fund's investment objective, policies and restrictions, to buy, sell, lend and
otherwise trade in any stocks, bonds, options and other securities and
investment instruments on behalf of the Funds, to purchase, write or sell
options on securities, futures contracts or indices on behalf of the Funds, to
enter into commodities contracts on behalf of the Funds, including contracts for
the future delivery of securities or currency and futures contracts on
securities or other indices, and to execute any and all agreements and
instruments and to do any and all things incidental thereto in connection with
the management of the Funds. Should the Trustees of the Trust at any time,
however, make any specific determination as to investment policy for the Funds
and notify the Adviser thereof in writing, the Adviser shall be bound by such
determination for the period, if any, specified in such notice or until
similarly notified that such determination has been revoked. The Adviser shall
take, on behalf of the Funds, all actions which it deems necessary or desirable
to implement the investment policies of the Trust and of each Fund.
The Adviser shall place all orders for the purchase or sale of portfolio
securities for the account of a Fund with brokers or dealers selected by the
Adviser, and to that end the Adviser is authorized as the agent of the Fund to
give instructions to the custodian of the Fund as to deliveries of securities
and payments of cash for the account of a Fund or the Trust. In connection with
the selection of such brokers or dealers and the placing of such orders, the
Adviser shall use its best efforts to seek to execute portfolio security
transactions at prices which are advantageous to the Funds and (when a disclosed
commission is being charged) at reasonably competitive commission rates. In
selecting brokers or dealers qualified to
<PAGE>
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services and products (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934) to the Adviser.
The Adviser is expressly authorized to cause the Funds to pay any broker or
dealer who provides such brokerage and research service and products a
commission for executing a security transaction which exceeds the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Adviser determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
particular transaction or the overall responsibilities which the Adviser and its
affiliates have with respect to accounts over which they exercise investment
discretion. Subject to the requirement set forth in the second sentence of this
paragraph, the Adviser is authorized to consider, as a factor in the selection
of any broker or dealer with whom purchase or sale orders may be placed, the
fact that such broker or dealer has sold or is selling shares of the applicable
Fund or Trust or of other investment companies sponsored by the Adviser.
2. COMPENSATION OF THE ADVISER. For the services, payments and facilities
to be furnished hereunder by the Adviser, each Trust on behalf of each Fund
shall pay to the Adviser on the last day of each month a fee equal (annually) to
the percentage or percentages specified in Schedule B of the average daily net
assets of such Fund throughout the month, computed in accordance with the
Trust's Declaration of Trust, registration statement and any applicable votes of
the Trustees of the Trust.
If the Contract is initiated or terminated during any month with respect
to any Fund, each Fund's fee for that month shall be reduced proportionately on
the basis of the number of calendar days during which the Contract is in effect
and the fee shall be computed upon the average net assets for the business days
the Contract is so in effect for that month.
The Adviser may, from time to time, agree not to impose all or a part of
the above compensation.
3. ALLOCATION OF CHARGES AND EXPENSES. Each Trust will pay all of its expenses
other than those expressly stated to be payable by the Adviser hereunder, which
expenses payable by the Trust shall include, without limitation (i) expenses of
maintaining the Trust and continuing its existence, (ii) registration of the
Trust under the Investment Company Act of 1940, (iii) commissions, fees and
other expenses connected with the purchase or sale of securities, (iv) auditing,
accounting and legal expenses, (v) taxes and interest, (vi) governmental fees,
(vii) expenses of issue, repurchase and redemption of shares, (viii) expenses of
registering and qualifying the Trust and its shares under federal and state
securities laws and of preparing and printing prospectuses for those purposes
and for distributing them to shareholders and investors, and fees and expenses
of registering and maintaining registration of the Trust and of the Trust's
principal underwriter, if any, as broker-dealer or agent under state securities
laws, (ix) expenses of reports and notices to shareholders and of meetings of
shareholders and proxy solicitations therefor, (x) expenses of reports to
governmental officers and commissions, (xi) insurance expenses, (xii)
association membership dues, (xiii) fees, expenses and disbursements of
custodians and subcustodians for all services to the Trust (including without
limitation safekeeping of funds and securities, keeping of books and accounts
and determination of net asset value), (xiv) fees, expenses and disbursements of
transfer agents and registrars for all services to the Trust, (xv) expenses for
servicing shareholder accounts, (xvi) any direct charges to shareholders
approved by the Trustees of the Trust, (xvii) compensation of and any expenses
of Trustees of the Trust, (xviii) the administration fee payable to the Trust's
administrator, (xix) the charges and expenses of the independent auditors, (xx)
the charges and expenses of legal counsel to the Trust and the Trustees, (xxi)
distribution fees, if any, paid by a Fund in accordance with Rule 12b-1 under
the 1940 Act, and (xxii) such nonrecurring items as may arise, including
expenses incurred in connection with litigation, proceedings and claims and the
obligation of the Trust to indemnify its Trustees and officers with respect
thereto.
4. OTHER INTERESTS. It is understood that Trustees, officers and shareholders of
each Trust are or may
<PAGE>
be or become interested in the Adviser or any of its affiliates as
directors, officers, employees, stockholders or otherwise and that directors,
officers, employees and stockholders of the Adviser or any of its affiliates are
or may be or become similarly interested in the Trust, and that the Adviser or
any of its affiliates may be or become interested in the Trust as a shareholder
or otherwise. It is also understood that directors, officers, employees and
stockholders of the Adviser or any of its affiliates are or may be or become
interested (as directors, trustees, officers, employees, stockholders or
otherwise) in other companies or entities (including, without limitation, other
investment companies) which the Adviser or any of its affiliates may organize,
sponsor or acquire, or with which it may merge or consolidate, and which may
include the words "Wright" or "Wright Investors" or any combination thereof as
part of their names, and that the Adviser or any of its affiliates may enter
into advisory or management agreements or other contracts or relationships with
such other companies or entities.
5. LIMITATION OF LIABILITY OF THE ADVISER. The services of the Adviser to
each Trust are not to be deemed to be exclusive, the Adviser being free to
render services to others and engage in other business activities. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Adviser, the
Adviser shall not be subject to liability to any Trust or to any shareholder of
the Trust for any act or omission in the course of or connected with, rendering
services hereunder or for any losses which may be sustained in the purchase,
holding or sale of any security.
6. SUB-INVESTMENT ADVISERS. The Adviser may employ one or more sub-investment
advisers from time to time to perform such of the acts and services of the
Adviser, including the selection of brokers or dealers to execute any Trust's
portfolio security transactions, and upon those terms and conditions as may be
agreed upon between the Adviser and the sub-investment adviser; provided,
however, that any subadvisory agreement shall be subject to approval by the
Trustees and by shareholders, if shareholder approval is then required by the
1940 Act, as now in effect or as hereafter amended, subject, however, to such
exemption as may be granted by the Securities and Exchange Commission by any
rule, regulation, order or interpretive position.
7. DURATION AND TERMINATION OF THIS CONTRACT. This Contract shall become
effective upon the date of its execution, and, unless terminated as herein
provided, shall remain in full force and effect as to each Fund up to and
including February 28, 2000 and shall continue in full force and effect as to
each Fund indefinitely thereafter, but only so long as such continuance after
February 28, 2000 is specifically approved at least annually (i) by the vote of
a majority of the Trustees of the Trust or by vote of a majority of the
outstanding voting securities of that Fund and (ii) by the vote of a majority of
those Trustees of the Trust who are not interested persons of the Adviser or the
Trust, in accordance with the requirements of the Investment Company Act of 1940
as now in effect or as hereafter amended, subject, however, to such exemptions
as may be granted by the Securities and Exchange Commission by any rule,
regulation, order or interpretive position.
Either party hereto may, at any time on sixty (60) days' prior written
notice to the other, terminate this Contract as to any Fund, without the payment
of any penalty, by action of its Board of Directors or Trustees, as the case may
be, and a Trust may, at any time upon such written notice to the Adviser,
terminate this Contract as to any Fund by vote of a majority of the outstanding
voting securities of that Fund. This Contract shall terminate automatically in
the event of its assignment.
8. AMENDMENTS OF THE CONTRACT. This Contract may be amended as to any Fund by a
writing signed by both parties hereto, provided that no material amendment to
this Contract shall be effective as to that Fund until approved (i) by the vote
of a majority of those Trustees of the affected Trust who are not interested
persons of the Adviser or the Trust and (ii) by vote of a majority of the
outstanding voting securities of that Fund in accordance with the requirements
of the Investment Company Act of 1940, as now in effect or as hereafter amended,
subject, however, to such exemptions as may be granted by the
<PAGE>
Securities and Exchange Commission by any rule, regulation, order or
interpretive position.
9. LIMITATION OF LIABILITY. The Adviser expressly acknowledges the provision in
the Declaration of Trust of each Trust limiting the personal liability of
shareholders of the Trust, and the Adviser hereby agrees that it shall have
recourse only to the applicable Trust for payment of claims or obligations as
between the Trust and Adviser arising out of this Contract and shall not seek
satisfaction from the shareholders or any shareholder of the Trust. No Trust or
Fund shall be liable for the obligations of any other Trust or Fund hereunder.
10. CERTAIN DEFINITIONS. The terms "assignment" and "interested persons" when
used herein shall have the respective meanings specified in the Investment
Company Act of 1940, as now in effect or as hereafter amended subject, however,
to such exemptions as may be granted by the Securities and Exchange Commission
by any rule, regulation or order. The term "vote of a majority of the
outstanding voting securities of that Fund" shall mean the vote of the lesser of
(a) 67 per cent or more of the shares of the particular Fund present or
represented by proxy at a meeting of shareholders of the Fund if the holders of
more than 50 per cent of the outstanding shares of the particular Fund are
present or represented by proxy at the meeting, or (b) more than 50 per cent of
the outstanding interests of the particular Fund, or such other vote as may be
required from time to time by the Investment Company Act of 1940.
11. USE OF THE NAME "WRIGHT". The Adviser hereby consents to the use by each
Trust of the name "Wright" as part of the Trust's name and the name of each Fund
should the Trust desire to adopt such name in the future; provided, however,
that such consent shall be conditioned upon the employment of the Adviser or one
of its affiliates as the investment adviser of the Trust. The name "Wright" or
any variation thereof may be used from time to time in other connections and for
other purposes by the Adviser and its affiliates and other investment companies
that have obtained consent to use the name "Wright." The Adviser shall have the
right to require a Trust to cease using the name "Wright" as part of the Trust's
name and the name of its Funds if the Trust ceases, for any reasons, to employ
the Adviser or one of its affiliates as the Trust's investment adviser. Future
names adopted by a Trust for itself and its Funds, insofar as such names include
identifying words requiring the consent of the Adviser, shall be the property of
the Adviser and shall be subject to the same terms and conditions.
THE WRIGHT MANAGED EQUITY TRUST WRIGHT INVESTORS' SERVICE, INC.
By: _________________________________ By:_______________________________
Authorized Officer Authorized Officer
THE WRIGHT MANAGED INCOME TRUST
By: __________________________________
Authorized Officer
THE WRIGHT EQUIFUND EQUITY TRUST
By: ___________________________________
Authorized Officer
CATHOLIC VALUES INVESTMENT TRUST
By: ___________________________________
Authorized Officer
THE WRIGHT MANAGED BLUE CHIP SERIES TRUST
By: _____________________________________
Authorized Officer
<PAGE>
SCHEDULE A
TRUSTS AND FUNDS
The Wright Managed Equity Trust
Wright Selected Blue Chip Equities Fund
Wright Junior Blue Chip Equities Fund
Wright Major Blue Chip Equities Fund
Wright International Blue Chip Equities Fund
The Wright Managed Income Trust
Wright U.S. Treasury Fund
Wright U.S. Government Near Term Fund
Wright Total Return Bond Fund
Wright Current Income Fund
Wright U.S. Treasury Money Market Fund
The Wright EquiFund Equity Trust
Wright EquiFund -- Belgium/Luxembourg
Wright EquiFund -- Hong Kong/China
Wright EquiFund -- Japan
Wright EquiFund -- Mexico
Wright EquiFund -- Netherlands
Wright EquiFund -- Nordic
Catholic Values Investment Trust
Catholic Values Investment Trust Equity Fund
The Wright Blue Chip Series Trust
Wright International Blue Chip Portfolio
Wright Selected Blue Chip Portfolio
<PAGE>
SCHEDULE B
ANNUAL ADVISORY FEE RATES
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<TABLE>
<CAPTION>
ANNUAL % ADVISORY FEE RATES
-----------------------------
Under $100 Mil. $250 Mil. $500 Mil. Over
$100 Mil. to to to $1 Bil.
$250 Mil. $500 Mil. $1 Bil.
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The Wright Managed Equity Trust
<S> <C> <C> <C> <C> <C>
Wright Selected Blue Chip Equities
Fund 0.55% 0.69% 0.67% 0.63% 0.58%
Wright Junior Blue Chip Equities Fund 0.55% 0.69% 0.67% 0.63% 0.58%
Wright Major Blue Chip Equities Fund 0.45% 0.59% 0.57% 0.53% 0.48%
Wright International Blue Chip Equities
Fund 0.75% 0.79% 0.77% 0.73% 0.68%
The Wright Managed Income Trust
Wright U.S. Treasury Fund 0.40% 0.46% 0.42% 0.38% 0.33%
Wright U.S. Government Near Term Fund 0.40% 0.46% 0.42% 0.38% 0.33%
Wright Total Return Bond Fund 0.40% 0.46% 0.42% 0.38% 0.33%
Wright Current Income Fund 0.40% 0.46% 0.42% 0.38% 0.33%
Wright U.S. Treasury Money Market
Fund 0.35% 0.32% 0.32% 0.30% 0.30%
</TABLE>
ANNUAL % ADVISORY FEE RATES
-------------------------------------------
Under $500 Mil. Over
$500 Mil. to $1 Bil.
$1 Bil.
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The Wright EquiFund Equity Trust
Wright EquiFund -- Belgium/Luxembourg 0.75% 0.73% 0.68%
Wright EquiFund -- Hong Kong/China 0.75% 0.73% 0.68%
Wright EquiFund -- Japan 0.75% 0.73% 0.68%
Wright EquiFund -- Mexico 0.75% 0.73% 0.68%
Wright EquiFund -- Netherlands 0.75% 0.73% 0.68%
Wright EquiFund -- Nordic 0.75% 0.73% 0.68%
Catholic Values Investment Trust
Catholic Values Investment Trust
Equity Fund 0.75% 0.73% 0.68%
ANNUAL % ADVISORY FEE RATES
--------------------------------
Under $500 Mil. Over
$500 Mil. to $1 Bil.
$1 Bil.
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The Wright Managed Blue Chip Series Trust
Wright Selected Blue Chip Portfolio 0.65% 0.60% 0.55%
Wright International Blue Chip Portfolio 0.80% 0.75% 0.70%
September 24, 1997
The Wright Managed Investment Funds
Wright Investors' Service, Inc.
1000 Lafayette Boulevard
Bridgeport, CT 06604
Re: Master Custodian Agreement by and among the Wright Managed Investment Funds
and Investors Bank & Trust Company (the "Bank").
Gentlemen:
This letter agreement is intended to amend the existing Master Custodian
Agreement with the following information:
Notwithstanding anything in the Master Custodian Agreement,
each Wright Managed Investment Fund agrees that it has granted, and the
Bank shall have, a continuing lien and security to the extent of any
overdraft or indebtedness by any Fund, in and to any property at any
time held by it for the Fund's benefit or in which the Fund has an
interest and which is then in the Bank's possession or control (or in
the possession or control of any third party acting in the Bank's
behalf). However, the Bank shall notify the Fund's investment adviser
of the Bank's intention to seize Fund property in accordance with this
paragraph and follow any instructions of the investment adviser as to
which property should be seized.
This letter agreement is intended to include all the Wright Managed Investment
Funds currently parties to the Master Custodian Agreement, as well as any such
funds that become a party to the Master Custodian Agreement in the future. This
letter agreement shall constitute an amendment to the Master Custodian Agreement
and, as such, a binding agreement among the Wright Managed Investment Funds and
the Bank, in accordance with its terms.
Sincerely.
INVESTORS BANK & TRUST COMPANY
By /s/ Robert D. Mancuso
----------------------------
Name: Robert D. Mancuso
Title: Senior Vice President
<PAGE>
The foregoing is hereby accepted and agreed.
THE WRIGHT MANAGED EQUITY TRUST
THE WRIGHT MANAGED INCOME TRUST
THE WRIGHT EQUIFUND EQUITY TRUST
THE WRIGHT MANAGED BLUE CHIP SERIES TRUST
CATHOLIC VALUES INVESTMENT TRUST
THE WRIGHT ASSET ALLOCATION TRUST
By /s/ James L. O'Connor
-------------------------------
Name: James L. O'Connor
Title: Treasurer
POWER OF ATTORNEY
I, the undersigned Trustee of Catholic Values Investment Trust, a
Massachusetts business trust, do hereby constitute and appoint H. Day Brigham,
Jr., Peter M. Donovan, Alan R. Dynner and A.M. Moody, III, or any of them, to be
true, sufficient and lawful attorneys, or attorney for me, to sign for me, in my
name in the capacities indicated below, any and all amendments (including
post-effective amendments) to the Registration Statement on Form N-1A filed by
Catholic Values Investment Trust with the Securities and Exchange Commission in
respect of shares of beneficial interest and other documents and papers relating
thereto.
IN WITNESS WHEREOF I have hereunto set my hand on the date set opposite my
signature.
NAME CAPACITY DATE
---- -------- ----
/s/ Dorcas R. Hardy Trustee December 9, 1998
- ----------------------
Dorcas R. Hardy
HALE AND DORR LLP
Counsellors at Law
60 State Street, Boston, Massachusetts 02109
617-526-6000 o fax 617-526-5000
Pamela J. Wilson
617-526-6371
[email protected]
February 24, 1999
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549
Attention: Office of Filings, Information & Consumer Services
Re: Form N-1A Filing for Catholic Values Investment Trust
(the "trust")
Post-Effective Amendment No. 4 (1933 Act File No. 333-17161)
Amendment No. 5 (1940 Act File No. 811-07951) (the
"amendment")
Ladies and Gentlemen:
On behalf of the above-referenced trust, transmitted herewith pursuant to
(1) the Securities Act of 1993, as amended and Rules 472 and 485(a)(1)
thereunder, (2) the Investment Company Act of 1940, as amended, and the rules
promulgated pursuant to Section 8(b) thereunder, (3) the General Instructions to
Form N-1A, and (4) Rules 101 and 102 under Regulation S-T, is the amendment,
including a prospectus and statement of additional information ("SAI") for
Catholic Values Investment Trust Equity Fund (the "fund") and exhibits. The
amendment contains conformed signature pages, and the manually signed originals
of these pages are maintained at the office of the trust.
The amendment is filed pursuant to Rule 485(a) because it has been
revised to conform to the 1998 amendments to Form N-1A. Because the fund's
prospectus has been revised in its entirety, it is not marked. The SAI has been
marked to show changes from the SAI contained in post-effective amendment no. 3
transmitted electronically to the Securities and Exchange Commission (the
"Commission") on April 30, 1998 (Accession No. 0000715165-98-000021).
The amendment will become effective April 30, 1999. The trust will file
a post-effective amendment pursuant to Rule 485(b), which will also go effective
on April 30, 1999, for the purpose of providing updated financial information
for the fund.
The design and layout of the fund's prospectus conforms to that of the
prospectuses of the other mutual funds in the Wright complex. These other
prospectuses are being filed with the Commission on or about February 28, 1999
and will offer the shares of multiple Wright funds. It is also possible that the
fund's prospectus will offer additional funds for Catholic investors in the
future. A consolidated prospectus for multiple funds presents special
organization and layout problems that would not affect a single fund prospectus.
To solve these problems, the prospectus disclosure for the other Wright funds
follows a slightly different sequence from the order of disclosure specified in
Items 1, 2 and 3 of amended Form N-1A. To maintain a uniform layout and
facilitate comparisons with the other Wright funds, the fund's prospectus
follows the same sequence as the other funds' prospectuses.
Amended Form N-1A requires the risk/return summary provided in Items 2
and 3 to immediately follow the cover page and table of contents of a mutual
fund prospectus. The disclosure in a prospectus's risk/return summary generally
must appear in the order specified in Items 2 and 3 and may not include
additional disclosure not described in these items.
The table of contents in the fund's prospectus is on the inside cover
page. Immediately below the table of contents is a section entitled
"How to Use this Prospectus" that provides a brief explanation of each of the
icons and related disclosure appearing in the risk/return summary. We believe
that this information serves the same purpose as the table of contents--to help
investors navigate and understand the organization of the prospectus. It leads
readers and does not impede their progress into the risk/return summary. The
next item is the standard legend for funds sold through banks, which would
normally appear later in the risk/return summary. The legend is located here
because, in the multi-fund prospectuses of the other Wright funds, putting the
legend up front avoids the need to repeat it in the risk/return summary of each
individual fund.
On page 1, which is opposite the table of contents, there appears
disclosure about the fund's policy of investing only in companies whose
activities are consistent with the core values of the Catholic Church. There is
also information about the fund's Catholic Advisory Board, which oversees
compliance with these values. This disclosure applies, not only to the fund, but
to any future funds that may be offered in this prospectus. The fund's ethical
investing policy and advisory board are the factors which most distinguish it
from other mutual funds. These factors also have a strong bearing on who may
want to invest in the fund, which is permissible risk/return summary disclosure
under Item 2 of Form N-1A. Therefore, it is appropriate to give this disclosure
priority and locate it in the overview section on page 1 of the fund's
prospectus.
Disclosure about the fund's adviser is not expressly permitted in, and
is not ordinarily supposed to precede, a risk/return summary. However, in the
multi-fund prospectuses of the other Wright funds, if this disclosure cannot be
presented on page 1, it must be moved either to the front cover or to the back
half of the prospectus. It is not desirable either to clutter the cover with
adviser information or to make investors wait until page 20 (in the prospectus
for the Wright Managed Blue Chip Investment funds) to find out about the adviser
they are hiring when they buy fund shares. To avoid distracting attention from
the risk/return summary disclosure on pages 2 and 3, we kept the adviser
disclosure on page 1 very brief.
The fund's adviser uses a proprietary data base and Approved Wright
Investment Lists in selecting investments for all of the Wright equity funds,
including the fund. In the multi-fund prospectuses, disclosing this part of
Wright's investment strategy on page 1 provides a context for understanding the
additional investment strategy disclosure (and avoids repetition of the same
information) in each individual fund's two page risk/return summary. Page 1 of
both the fund's prospectus and the other Wright funds' prospectuses also
discloses two important risks--market risk and management risk--that apply to
all of the funds in these prospectuses. This disclosure also helps to provide a
context for and to avoid repetition in the risk/return summaries of the
multi-fund prospectuses.
Although the fund's prospectus offers only a single fund, we believe
that investors will benefit if the disclosure in the Wright multi-fund
prospectuses about the investment adviser, its proprietary data base, its
Approved Wright Investment Lists and the risks common to all the funds also
appear in the same location in the fund's prospectus. All of the other
information required to be in the fund's risk/return summary appears on a two
page spread following page 1. This layout enables readers to see most of the
required fund information all at one time.
Instruction C.1.(d) to Form N-1A states that the Commission should
administer the form's prospectus disclosure requirements "in a way that will
allow variances in disclosure or presentation if appropriate for the
circumstances involved while remaining consistent with the objectives of Form
N-1A." We believe that our method of organizing the fund's prospectus produces
clearer, more inviting disclosure and better facilitates comparisons with other
Wright funds than if the prospectus followed the exact sequence of disclosure in
Items 2 and 3 of Form N-1A. The organization of the prospectus enhances, rather
than impedes, comparisons with other funds and makes it easier to find
fund-specific information. Accordingly, the trust respectfully requests that the
staff of the Commission allow such variances in presentation as are necessary
for the fund to use the proposed form of prospectus.
If you have any questions concerning the foregoing or the enclosed,
please contact the undersigned at (617) 526-6371 or Elaine Hartnett at (617)
526-6531.
Very truly yours,
Pamela J. Wilson
PJW:laf
Enclosures
