SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
File Numbers: 333-41565 and 811-08501
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No. ___
Post-Effective Amendment No. 2 X
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 3 X
(Check appropriate box or boxes.)
THE BOYLE FUND
(Exact name of Registrant as Specified in Charter)
850 POWELL STREET, SUITE 104, SAN FRANCISCO, CALIFORNIA 94108 (Address
of Principal Executive Offices) Zip Code Registrant's Telephone Number,
including Area Code (415) 693-0800
Michael J. Boyle
Boyle Management and Research, Inc.
850 Powell Street, Suite 104, San Francisco, California 94108
(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) of Rule 485.
[ ] on (date) pursuant to paragraph (b) of Rule 485.
[x] 60 days after filing pursuant to paragraph (a)(1) of Rule 485.
[ ] on (date) pursuant to paragraph (a)(1) of Rule 485.
[ ] 75 days after filing pursuant to paragraph (a)(2) of Rule 485.
[ ] on (date) pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following box
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
-----------------------------------------------------------
<PAGE>
[Outside front cover]
P R O S P E C T U S
August __, 1999
THE BOYLE FUND
BOYLE MARATHON FUND
For Investors Seeking Long-Term Capital Appreciation
Income Is Secondary
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved of these securities, nor has the Commission determined
that this Prospectus is complete or accurate. Any representation to the contrary
is a criminal offense.
[LOGO]
The Boyle Fund
Boyle Marathon Fund
850 Powell Street, Suite 104
San Francisco, California 94108
<PAGE>
TABLE OF CONTENTS
I. The Fund
The Objective of the Boyle Marathon Fund.......................................
The Principal Investment Strategies and Policies of the Fund....
The Investment Selection Process Used by the Fund...............
The Principal Risks of Investing in the Fund....................
Who Should Invest...............................................
Performance History.............................................
Costs of Investing in the Fund..................................
Expense Example.................................................
Additional Investment Strategies and Risk Considerations........
II. Who Manages the Fund
The Portfolio Manager and the Adviser..........................................
Fund Administration ...........................................
III. How to Buy and Sell Shares
Pricing of Fund Shares..........................................
Investing in the Fund...........................................
Types of Account Ownership......................................
Instructions For Opening and Adding to an Account...............
Telephone and Wire Transactions.................................
Tax-Deferred Plans..............................................
Types of Tax-Deferred Accounts..................................
Automatic Investment Plans......................................
Instructions For Selling Fund Shares............................
Additional Redemption Information...............................
Shareholder Communications......................................
Dividends and Distributions.....................................
Taxes...........................................................
IV. Financial Highlights -----------.
<PAGE>
YOUR GUIDE TO THE PROSPECTUS
This Prospectus is designed to help you make an informed decision about
investing in the Boyle Marathon Fund. Please read the Prospectus carefully
before investing and keep it on file for future reference.
The first section tells you important things about the Fund that you should know
before you invest:
* The Fund's investment objective - what the Fund is trying to
achieve.
* The principal investment strategies of the Fund - how the Fund tries
to meet its investment objective.
* The Fund's method of selecting investments - how the Fund
chooses its primary investments.
* Risks you should be aware of - the principal risks of investing in
the Fund.
The second section tells you about the managers of the Fund and Fund
administration. The third section tells you how to buy shares in the Fund and
how shares are priced. The fourth section tells you about the Fund's financial
information.
<PAGE>
I. THE FUND
THE OBJECTIVE OF THE BOYLE MARATHON FUND
- - The Fund seeks long-term growth of capital.
- - Income is secondary.
THE PRINCIPAL INVESTMENT STRATEGIES
AND POLICIES OF THE FUND
* The Fund invests primarily in securities of companies in the technology,
financial services, pharmaceutical, and retail fields. The Fund may also invest
in other companies. The Fund normally maintains a core position of 30-40 common
stocks selected for their growth potential over a 3 to 5 year period.
* The Fund concentrates its investments in the securities of companies in
technology, retail, financial services, and pharmaceuticals, which means at
least 25%, and as much as 100%, of the Fund's assets can be invested in this
group of industries. The Fund may also invest in other areas.
[Side panel: The Fund's ticker symbol is BFUNX. You may follow the changes in
the Fund's daily share price by entering the Fund's ticker symbol anywhere you
would normally obtain a stock quotation.]
[Side panel: The Fund's objective may not be changed without shareholder
approval.]
* The Fund invests primarily in companies whose revenues and earnings are likely
to grow faster than the economy as a whole, offering above-average prospects for
capital appreciation and only a secondary emphasis on dividend income.
* The Fund is a "non-diversified" portfolio, which means it can invest in fewer
securities at any one time than diversified portfolios.
* Under normal conditions, the Fund will be invested (at least 90% of the value
of the Fund's net assets) in common stock. Under adverse market conditions, when
investment opportunities are limited, or in the event of exceptional redemption
requests, the Fund may hold cash or cash-equivalents and invest without limit in
obligations of the U.S. Government and its agencies and in money market
securities, including repurchase agreements and short-term debt securities.
Under these circumstances, the Fund may not participate in stock market advances
or declines to the same extent it would had it remained more fully invested in
common stocks. As a result, the Fund may not achieve its investment objective.
<PAGE>
THE INVESTMENT SELECTION PROCESS
USED BY THE FUND
In selecting investments for the Fund, the Adviser focuses on four of the
fastest growing segments of the economy (in the opinion of the Adviser) -
technology, retail, pharmaceuticals, and financial services. The Adviser then
selects the companies that are leaders in these segments. These companies will
have strong financial positions, excellent management, and innovative products
and approaches to the market.
[Side panel: Mutual funds generally emphasize either "growth" or "value" styles
of investing. Growth funds invest in companies that exhibit faster-than-average
growth in revenues and earnings, appealing to investors who are willing to
accept more volatility in hopes of a greater increase in share price. Value
funds invest in companies that appear under priced according to certain
financial measurements of their intrinsic worth or business prospects. Value
funds appeal to investors who want some dividend income and the potential for
capital gains, but are less tolerant of share price fluctuations.]
[Side panel: All mutual funds must elect to be "diversified" or
"non-diversified." As a non-diversified portfolio, the Fund may invest half of
its total assets in two or more securities, while the other half is spread out
among investments not exceeding 5% of the Fund's total assets at the time of
purchase. As a result, the Fund has the ability to take larger positions in a
smaller number of securities than a diversified portfolio. These limitations do
not apply to U.S. Government securities.]
The Adviser supplements this analysis with meetings with company management. The
Adviser prefers to hear directly from company management on how management plans
to increase revenue, profits, and shareholder value. The Adviser also visits a
company's retail operations to evaluate how the business is going.
THE PRINCIPAL RISKS OF
INVESTING IN THE FUND
Risks in General
You could lose money investing in the Fund because the Fund invests in common
stocks, which change in value. You should consider your own investment goals,
time horizon, and risk tolerance before investing in the Fund. An investment in
the Fund may not be appropriate for all investors and is not intended to be a
complete investment program.
<PAGE>
Risks of Investing in Common Stocks
The Fund invests primarily in the common stocks, which subjects the Fund and its
shareholders to the inherent market risks due to changes in company earnings,
economic conditions, interest rates, and other factors beyond the control of the
Adviser. These risks include the financial risk of selecting individual
companies that do not perform as anticipated, the risk that the stock markets in
which the Fund invests may experience periods of turbulence and instability, and
the general risk that domestic and global economies may go through periods of
decline and cyclical change.
Many factors affect an individual company's performance, such as the strength of
its management or the demand for its product or services. You should be aware
that the value of a company's share price may decline as a result of poor
decisions made by management or lower demand for the company's products or
services. In addition, a company's share price may also decline if its earnings
or revenues fall short of expectations.
Risk of Non-Diversification
As previously mentioned, the Fund is a non-diversified portfolio, which means
that it has the ability to take larger positions in a smaller number of
securities than a diversified portfolio. Non-diversification increases the risk
that the value of the Fund could go down because of the poor performance of a
single investment.
Industry Risk
Industry risk is the possibility that stocks within the same industry will
decline in price due to industry-specific market or economic developments.
Investments in the common stocks of companies in the technology and
pharmaceutical fields are subject to the risk that the primary products of the
issuer may be overtaken by newer products or by price cutting by competitors
with similar products, reducing the value of the Fund's holdings. Investments in
the common stocks of retail companies may be subject to the overall economy,
consumer confidence, wage gains, changes in taxes, changes in employment levels,
and the weather. Investments in the common stocks of financial service companies
are subject to the risk of changes in interest rates and the widely held
expectations for such changes. These matters are beyond the control of the
Adviser. These investments can fluctuate dramatically in value.
<PAGE>
WHO SHOULD INVEST
The Fund may be suitable for you if:
* You are seeking growth of capital over a 3 to 5 year period.
* You can tolerate greater risks associated with common stock investments.
* You are not primarily interested in current income.
* You characterize your investment goal as seeking above-average gains.
* You are willing to accept significant fluctuations in share price.
* You are not pursuing a short-term goal or investing emergency reserves.
PERFORMANCE HISTORY
The bar chart and table below show the variability of the Fund's returns, which
is one indicator of the risks of investing in the Fund. The bar chart shows the
Fund's performance through June 30, 1999 together with the best and worst
quarters since inception. The table compares the Fund's average annual returns
for the periods indicated to those of the Standard and Poor's 500 Index and the
Dow Jones Industrial Average. As with all mutual funds, past results are not an
indication of future performance.
BOYLE MARATHON FUND
===============================================================
(Total return for the 12 month period ending June 30, 1999)
===============================================================
[HORIZONTAL BAR CHART]
Boyle Marathon Fund
|================================================ +41.70%
Standard & Poor's 500 Index
====================== +19.52%
Dow Jones Industrial Average
======================= +21.24%
Total Return - - 12 Month Return through June 30, 1999
===============================================================
Best Quarter (12-31-98) +26. 4% Worst Quarter (9-30-98) - 6.0%
===============================================================
<PAGE>
Average annual total return for periods ended 6/30/99
Since Inception
1 year
(2/19/98)
Boyle Marathon Fund 41.70% 33.92%
Dow Jones Industrial Average(1) 21.24% ____%
S&P 500 Index(2) 19.52% ____%
(1) The Dow Jones Industrial Average is a measurement of general market price
movement for 30 widely-held stocks listed on the New York Stock Exchange.
(2) The S&P 500 is the Standard & Poor's composite index of 500 Stocks, a widely
recognized, unmanaged index of common stock prices.
COSTS OF INVESTING IN THE FUND
The following table describes the expenses and fees that you may pay if you buy
and hold shares of the Fund. Annual fund operating expenses are paid out of the
assets of the Fund, so their effect is already included in the Fund's daily
share price and included in the returns mentioned above.
Shareholder Fees
(fees paid directly from your investment)
Sales Charge (Load) Imposed on Purchases.................. None
Deferred Sales Charge (Load)................................. None
Sales Charge (Load) Imposed on Reinvested Dividends.......... None
Redemption Fee............................................... None
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)
Management Fees............................................. 1.50%
12b-1 Distribution Fees...................................... None
Administrative and Other Expenses (a)........................ 1.10%
Total Annual Fund Operating Expenses........................ 2.60%
(a) Fees payable under the Administration Agreement between the Fund and the
Adviser are fixed at 1.00% of the Fund's average daily net assets. "Other
Expenses" include outside director expenses and independent audit expenses.
<PAGE>
[Side panel: The Fund is a no-load investment, which means you do not pay any
fees when you buy or sell shares of the Fund. As a result, all of your
investment goes to work for you.]
EXPENSE EXAMPLE
The following example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds. The example assumes
that you invest $10,000 in the Fund for the time periods indicated and then
redeem all of your shares at the end of those periods. The example also assumes
that your investment has a 5% annual return each year and that the Fund's
operating expenses remain the same each year. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
Shareholder Transaction Expenses
===============================================================
One Year Three Years Five Years Ten Years
-------------------------------------------------------------
Your costs: $260 $820 $1,437 $3,270
===============================================================
[Side panel: Understanding expenses: Operating a mutual fund involves a variety
of expenses including portfolio management, custody of the assets, fund
accounting, dividend distribution, shareholder confirmations and quarterly
statements, semi-annual and annual reports, SEC reporting, tax reporting and
other services. These expenses are paid from the Fund's assets in the form of a
management fee and administrative fee. Their effect is already factored into the
Fund's daily share price and returns.]
ADDITIONAL INVESTMENT STRATEGIES
AND RISK CONSIDERATIONS
Portfolio Turnover
The Fund generally purchases common stocks for long-term (3-5 years). Investment
changes are made in the Fund's portfolio whenever its portfolio manager believes
such changes are desirable. The Adviser targets a portfolio turnover rate of 40%
and does not expect the rate to exceed 80% under normal market conditions.
Higher portfolio turnover may cause the Fund to incur higher brokerage costs,
which may adversely affect the Fund's performance, and may produce increased
taxable distributions.
<PAGE>
[Side Panel: Portfolio turnover is calculated by dividing the lesser of the
Fund's purchases or sales of portfolio securities during a period by the monthly
average of the total value of portfolio securities during that period. Debt
securities with remaining maturities of one year or less when purchased by the
Fund are excluded from the calculation.]
Foreign Securities
The Fund does not have any foreign securities and has no present intent to have
any but the Fund may invest up to 10% of its net assets in foreign securities.
These investments may be publicly traded in the United States or on a foreign
exchange and may be bought and sold in a foreign currency. The Adviser generally
selects foreign securities on a stock-by-stock basis based on growth potential.
Foreign investments are subject to risks not usually associated with owning
securities of U.S. issuers. These risks can include fluctuations in foreign
currencies, foreign currency exchange controls, political and economic
instability, differences in financial reporting, differences in securities
regulation and trading, and foreign taxation issues.
Fixed Income Securities
The Fund does not have any fixed income securities and does not presently intend
to have any, however, under normal market conditions, the Fund may invest up to
35% of its total assets in all types of fixed income securities, including U.S.
government obligations. Fixed income securities are subject to credit risk and
interest rate risk. Credit risk is the risk that the Fund could lose money if an
issuer of a fixed income security cannot meet its financial obligations or goes
bankrupt. Interest rate risk is the risk that the Fund's investments in fixed
income securities may fall when interest rates rise.
Year 2000 Issue
The Fund depends on the smooth functioning of computer systems in almost every
aspect of its business. Like other mutual funds, financial and business
organizations and individuals around the world, the Fund could be adversely
affected if the computer systems used by the Adviser or the Fund's various
service providers do not properly process and calculate date-related information
and data on and after January 1, 2000. This possibility is commonly known as the
"Year 2000 Issue." The Adviser has taken steps that it believes are reasonably
designed to address the Year 2000 Issue with respect to computer systems that
are used and to obtain reasonable assurances that comparable steps are being
taken by the Fund's major service providers. At this time, however, there can be
no assurance that these steps will be sufficient to avoid any adverse impact on
the Fund. In addition, the Adviser cannot make any assurances that the Year 2000
Issue will not affect the companies in which the Fund invests or worldwide
markets and economies.
<PAGE>
II. WHO MANAGES THE FUND
THE PORTFOLIO MANAGERS
AND THE ADVISER
The Fund retains Boyle Management and Research, Inc., 850 Powell Street, Suite
104, San Francisco, California 94108 as its Adviser. Michael J. and Joanne E.
Boyle, who also serve as Trustees of the Trust, control the Adviser. Mr. and
Mrs. Boyle have served as the portfolio managers of the Fund since the Fund's
inception in February 1998. Prior to his association with the Adviser, Mr. Boyle
was Vice President of Business Development for a division of Harris Corporation
from April 1990 to June 1996 and from July 1996 to January 1997, Mr. Boyle
served as Senior Counsel. Harris is an information processing and communications
company headquartered in Melbourne, Florida for Harris Corporation. Prior to
her association with the Adviser, Mrs. Boyle served as President of Deck the
Walls, a retail business in Melbourne, Florida from August 1983 to October 1997.
Mrs. Boyle has a degree in education and Mr. Boyle has degrees in electrical
engineering and law.
Under a contract between the Fund and the Adviser, the Adviser manages the
Fund's portfolio of securities and investments and is responsible for the
overall management and administration of the Fund, subject to the policies of
the Fund's Board of Trustees. All orders for transactions in securities on
behalf of the Fund are placed with broker-dealers selected by the Adviser. The
Adviser may select broker-dealers that provide it with research services and may
cause the Fund to pay these broker-dealers commissions that exceed those that
other broker-dealers may have charged, if it views the commissions as reasonable
in relation to the value of the brokerage and/or research services provided.
The Adviser is responsible for the expenses of printing and distributing the
Fund's Prospectus and sales and advertising materials to prospective clients.
FUND ADMINISTRATION
The Trust has entered into a separate contract with the Adviser wherein the
Adviser is responsible for providing administrative and supervisory services to
the Fund. The Adviser oversees the maintenance of all books and records with
respect to the Fund's securities transactions and the Fund's book of accounts in
accordance with all applicable federal and state laws and regulations. The
Adviser also arranges for the preservation of journals, ledgers, documents,
brokerage account records and other records, which are required to be maintained
pursuant to the 1940 Act.
<PAGE>
The Adviser is responsible for the equipment, staff, office space and facilities
necessary to perform its obligations, including ordinary legal expenses. The
Adviser is responsible for payment of all of the Fund's operating expenses
except: brokerage and commission expenses, expenses of the Trustees who are not
officers of the Adviser, annual independent audit expenses, and any
extraordinary and non-recurring expenses.
Pursuant to an agreement between the Fund and the Adviser, organizational
expenses for the Fund have been advanced by the Adviser in exchange for
restricted shares in the Fund. The Fund is repaying these expenses over a
five-year period beginning in 1998.
The Adviser has retained Mutual Shareholder Services (the "Transfer Agent") to
serve as the Fund's transfer agent, dividend paying agent and shareholder
service agent, to provide accounting and pricing services to the Fund, and to
assist the Adviser in providing executive, administrative and regulatory
services to the Fund. The Adviser (not the Fund) pays the Transfer Agent's fees
for these services.
III. HOW TO BUY AND SELL SHARES
PRICING OF FUND SHARES
The price you pay for a share of the Fund, and the price you receive upon
selling or redeeming a share of the Fund, is called the Fund's net asset value
("NAV"). The NAV is calculated by taking the total value of the Fund's assets,
subtracting its liabilities, and then dividing by the total number of shares
outstanding, rounded to the nearest cent:
Net Asset Value = Total Net Assets - Liabilities
Number of Shares Outstanding
The NAV is generally calculated as of the close of trading on the New York Stock
Exchange (normally 4:00 p.m. Eastern time) every day the Exchange is open. All
purchases, redemptions or reinvestments of Fund shares will be priced at the
next NAV calculated after your order is received in proper form by the Fund's
Transfer Agent, Mutual Shareholder Services. Your order must be placed with the
Transfer Agent prior to the close of the trading of the New York Stock Exchange
in order to be confirmed for that day's NAV. The Fund's investments are valued
at market value or, if a market quotation is not readily available, at the fair
value determined in good faith by the Adviser, subject to the review and
oversight of the Fund's Board of Trustees. The Fund may use pricing services to
determine market value.
INVESTING IN THE FUND
You may purchase shares directly through the Fund's Transfer Agent or through a
brokerage firm or other financial institution that has agreed to sell the Fund's
shares. If you are investing directly in the Fund for the first time, you will
need to establish an account by completing a Shareholder Account Application.
(To establish an IRA, complete an IRA Application.) To request an application,
call toll-free 1-888-88-BOYLE or 1-888-882-6953 or visit our website at
www.boylefund.com to download an application. Your initial investment minimum is
$500 for either a regular or an IRA account. After that you may invest as little
as $50 in either type of account.
<PAGE>
All purchases must be made in U.S. dollars and checks must be drawn on U.S.
banks. No cash, credit cards or third party checks will be accepted. A $20 fee
will be charged against your account for any payment check returned to the
Transfer Agent or for any incomplete electronic funds transfer, or for
insufficient funds, stop payment, closed account or other reasons. If a check
does not clear your bank or the Fund is unable to debit your bank account on the
day of purchase, the Fund reserves the right to cancel the purchase. If your
purchase is canceled, you will be responsible for any losses or fees imposed by
your bank and losses that may be incurred as a result of a decline in the value
of the canceled purchase. The Fund (or its agent) has the authority to redeem
shares in your account(s) to cover any losses due to fluctuations in share
price. Any profit on such cancellation will accrue to the Fund.
[Side panel: Investments made through brokerage firms or other financial
institutions: If you invest through a brokerage firm or other financial
institution, the policies and fees may be different than those described here.
Financial advisers, financial supermarkets, brokerage firms, and other financial
institutions may charge transaction and other fees and may set different minimum
investments or limitations on buying or selling shares. Consult a representative
of your financial institution if you have any questions. Your financial
institution is responsible for transmitting your order in a timely manner.]
Your investment in the Fund should be intended to serve as a long-term
investment vehicle. The Fund is not designed to provide you with a means of
speculating on the short-term fluctuations in the stock market. The Fund
reserves the right to reject any purchase request that it regards as disruptive
to the efficient management of the Fund, which includes investors with a history
of excessive trading. The Fund also reserves the right to stop offering shares
at any time.
TYPES OF ACCOUNT OWNERSHIP
You can establish the following types of accounts by completing a Shareholder
Account Application:
* Individual or Joint Ownership
Individual accounts are owned by one person. Joint accounts have two or more
owners.
<PAGE>
* A Gift or Transfer to Minor (UGMA or UTMA)
An UGMA/UTMA account is a custodial account managed for the benefit of a minor.
To open an UGMA or UTMA account, you must include the minor's social security
number on the application.
* Trust
An established trust can open an account. The names of each trustee, the name of
the trust and the date of the trust agreement must be included on the
application.
* Business Accounts
Corporation and partnerships may also open an account. The application must be
signed by an authorized officer of the corporation or a general partner of a
partnership.
[Side panel: Costs and market timing: Some investors try to profit from
"market-timing" - switching money into investments when they expect the market
to rise, and taking money out when they expect the market to fall. As money is
shifted in and out by market timers, the Fund incurs expenses for buying and
selling securities. These costs are borne by all Fund shareholders, including
the long-term investors who do not generate the costs. Therefore, the Fund
discourages short-term trading by, among other things, closely monitoring
excessive transactions.]
INSTRUCTIONS FOR OPENING AND ADDING TO AN ACCOUNT
.........................................................................
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
- --------------------------------------------------------------------------
BY MAIL BY MAIL
.........................................................................
Complete and sign the Application Complete the investment slip
or an IRA Application. that is included with your account
statement, and write your account
Make your check payable to the number on your check. If you no longer
Boyle Marathon Fund have your investment slip,
* For IRA accounts, please please reference your name, account
specify the year for which the number, and address on your check.
contribution is made.
<PAGE>
MAIL YOUR APPLICATION AND MAIL THE SLIP AND THE CHECK TO: CHECK TO:
.........................................................................
The Boyle Marathon Fund The Boyle Marathon Fund
c/o Mutual Shareholder Services c/o Mutual Shareholder Services
1301 East Ninth Street, Suite 1000 1301 East Ninth Street, Suite 1000
Cleveland, Ohio 44114 Cleveland, Ohio 44114
BY OVERNIGHT COURIER, SEND TO:
.........................................................................
The Boyle Marathon Fund
c/o Mutual Shareholder Services
1301 East Ninth Street, Suite 1000
Cleveland, Ohio 44114
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
- --------------------------------------------------------------------------
BY WIRE BY WIRE
..............................................................................
Call 1-888-882-6953 for instruc- Send your investment to Fifth Third
tions and to obtain an investor Bank, N.A. by following the instruc-
account number or an IRA account tions listed in the column to the left.
number prior to wiring the funds.
Send your investment to Fifth Third
Bank, N.A. with these instructions:
* Fifth Third Bank, N.A.
* ABA#: 042000314
* For Credit to the Boyle Marathon Fund
* A/C#: 01-01-003-3324407
* For further credit to:
Your account number
Your name
Your SSN (for individuals)or tax identification number (for businesses)
TELEPHONE AND WIRE TRANSACTIONS
If you purchase your initial shares by wire, the Transfer Agent first must have
received a completed account application and issued an account number to you.
The account number must be included in the wiring instructions as set forth on
the previous page. The Transfer Agent must receive your account application to
establish shareholder privileges and to verify your account information. Payment
of redemption proceeds may be delayed and taxes may be withheld unless the Fund
receives a properly completed and executed account application.
<PAGE>
Shares purchased by wire will be purchased at the NAV next determined after the
Transfer Agent receives your wired funds and all required information is
provided in the wire instructions. If the Transfer Agent is notified no later
than 3:00 p.m. Eastern time of the wire instructions, and the wired funds are
received by the Transfer Agent no later than 5:00 p.m. Eastern time, then the
shares purchased will be priced at the NAV determined on that business day. If
the wire is not received by 5:00 p.m. Eastern time, the purchase will be
effective at the NAV next calculated after receipt of the wire.
TAX-DEFERRED PLANS
If you are eligible, you may set up one or more tax-deferred accounts. A
tax-deferred account allows you to shelter your investment income and capital
gains from current income taxes. A contribution to certain of these plans may
also be tax deductible. Tax-deferred accounts include retirement plans described
on the following page. Distributions from these plans are generally subject to
an additional tax if withdrawn prior to age 59 1/2 or used for a non-qualifying
purpose. Investors should consult their tax adviser or legal counsel before
selecting a tax-deferred account. Complete instructions about how to establish
and maintain your tax-deferred retirement plan will be included in the
retirement plan kit you receive in the mail.
Fifth Third Bank serves as the custodian for the tax-deferred accounts offered
by the Fund. There is no charge at present. The Fund reserves the right to
change the amount of the fee or to waive it in whole or part for certain types
of accounts.
TYPES OF TAX-DEFERRED ACCOUNTS
* Traditional IRA
An individual retirement account. Your contribution may or may not be deductible
depending on your circumstances. Assets can grow tax-free and distributions are
taxable as income.
* Roth IRA
An IRA with non-deductible contributions, tax-free growth of assets, and
tax-free distributions for qualified distributions.
* Spousal IRA
An IRA funded by a working spouse in the name of a non-earning spouse.
* Education IRA
This plan allows individuals, subject to certain income limitations, to
contribute up to $500 annually on behalf of any child under the age of 18.
<PAGE>
* SEP-IRA
An individual retirement account funded by employer contributions. Your assets
grow tax-free and distributions are taxable as income.
* Keogh or Profit Sharing Plans
These plans allow corporations, partnerships and individuals who are
self-employed to make tax-deductible contributions of up to $30,000 for each
person covered by the plans.
* 403(b) Plans
An arrangement that allows employers of charitable or educational organizations
to make voluntary salary reduction contributions to a tax-deferred account.
* 401(k) Plans
Allows employees of corporations of all sizes to contribute a percentage of
their wages on a tax-deferred basis. These accounts need to be established by
the trustee of the plan.
AUTOMATIC INVESTMENT PLANS
By completing the Automatic Investment Plan application, you may make automatic
monthly or quarterly investments ($50 minimum per purchase) in the Fund from
your bank or savings account. Shares of the Fund may also be purchased through
direct deposit plans offered by certain employers and government agencies. These
plans enable a shareholder to have all or a portion of their payroll or Social
Security checks transferred automatically to purchase shares of the Fund.
DIVIDEND REINVESTMENT
All income dividends and capital gains distributions will be automatically
reinvested in shares of the Fund unless you indicate otherwise on the account
application or in writing.
INSTRUCTIONS FOR SELLING FUND SHARES
You may sell all or part of your shares on any day that the New York Stock
Exchange is open for trading. Your shares will be sold at the next NAV per share
calculated after your order is received in proper form by the Transfer Agent.
The proceeds of your sale may be more or less than the purchase price of your
shares, depending on the market value of the Fund's securities at the time of
your sale. Your order will be processed promptly and you will generally receive
the proceeds within seven days after receiving your properly completed request.
The Fund will not mail any proceeds unless your investment check has cleared the
bank, which may take up to fifteen calendar days. This procedure is intended to
protect the Fund and its shareholders from loss. If the dollar or share amount
requested is greater than the current value of your account, your entire account
balance will be redeemed. If you choose to redeem your account in full, any
automatic services currently in effect for the account will be terminated unless
you indicate otherwise in writing.
<PAGE>
TO SELL SHARES
By Mail : Write a letter of instruction that includes:
* The names(s) and signature(s) of all account owners.
* Your account number.
* The dollar or share amount you want to sell.
* Where to send the proceeds.
* If redeeming from your IRA, please note applicable withholding requirements.
* Obtain a signature guarantee or other documentation, if required.
MAIL YOUR REQUEST TO: BY OVERNIGHT COURIER, SEND TO:
The Boyle Marathon Fund The Boyle Marathon Fund
c/o Mutual Shareholder Services c/o Mutual Shareholder Services
1301 East Ninth Street, Suite 1000 1301 East Ninth Street, Suite 1000
Cleveland, Ohio 44114 Cleveland, Ohio 44114
For specific information on how to sell shares, and to determine if a signature
guarantee or other documentation is required, please call toll-free in the U.S.
1-888-88-BOYLE.
ADDITIONAL REDEMPTION INFORMATION
Signature Guarantees
Signature guarantees are designed to protect both you and the Fund from fraud. A
signature guarantee of each owner is required to redeem shares in the following
situations:
* If you change ownership on your account.
* If you request the redemption proceeds to be sent to a different address than
that registered on the account.
* If the proceeds are to be made payable to someone other than the account's
owner(s).
* If a change of address request has been received by the Transfer Agent within
the last 15 days.
<PAGE>
* If you wish to redeem $20,000 or more from any shareholder account.
Signature guarantees can be obtained from most banks, savings and loan
associations, trust companies, credit unions, broker/dealers, and member firms
of a national securities exchange. Call your financial institution to see if
they have the ability to guarantee a signature. A notary public cannot provide
signature guarantees.
The Fund reserves the right to require a signature guarantee under other
circumstances or to delay a redemption when permitted by federal law.
Corporate, Trust and Other Accounts
Redemption requests from corporate, trusts, and other accounts may require
documents in addition to those described above, evidencing the authority of the
officers, trustees or others. In order to avoid delays in processing redemption
requests for these accounts, you should call the Transfer Agent at 1-
888-88-BOYLE to determine what additional documents are required.
[Side panel: Redemption in kind: The Fund intends to make payments for all
redemptions in cash. However, if the Fund believes that conditions exist which
make cash payments detrimental to the best interests of the Fund, payment for
shares redeemed may be made in whole or in part through a distribution of
portfolio securities chosen by the Adviser under the supervision of the Board of
Trustees. If payment is made in securities, shareholders may incur transaction
costs in converting these securities into cash after they have redeemed their
shares.]
Redemption Initiate by the Fund
Because there are certain fixed costs involved with maintaining your account,
the Fund may require you to redeem all of your shares if your account balance
falls below $500. After your account balance falls below the minimum balance,
you will receive a notification from the Fund indicating its intent to close
your account along with instructions on how to increase the value of your
account to the minimum amount within 60 days. If your account balance is still
below $500 after 60 days, the Fund may close your account and send you the
proceeds. The right of redemption by the Fund will not apply if the value of
your account balance falls below $500 because of market performance. The Fund
reserves the right to close an account if the shareholder is deemed to engage in
activities which are illegal or otherwise believed to be detrimental to the
Fund.
<PAGE>
SHAREHOLDER COMMUNICATIONS
Account Statements. Every quarter, each shareholder of the Fund will be sent an
account statement. You will also be sent a yearly statement detailing the tax
characteristics of any dividends and distributions you have received.
Confirmations. Confirmation statements will be sent after each transaction
that affects your account balance or account registration.
Regulatory Mailings. Financial reports will be sent at least semiannually.
Annual reports will include audited financial statements. To reduce expenses,
one copy of each report will be mailed to each taxpayer identification number
even though the investor may have more than one account in the Fund.
DIVIDENDS AND DISTRIBUTIONS
The Fund intends to pay distributions on an annual basis and expects that
distributions will consist primarily of capital gains. Dividends and
distributions from the Fund are automatically reinvested in the Fund, unless you
elect to have dividends paid in cash. Reinvested dividends and distributions
receive the same tax treatment as those paid in cash. If you are interested in
changing your election, you may call the Transfer Agent or send a written
notification to The Boyle Marathon Fund, c/o Mutual Shareholder Services, 1301
East Ninth Street, Suite 1000 Cleveland, Ohio 44114.
[Side panel: What is a distribution? As a shareholder, you are entitled to your
share of the Fund's income from interest and dividends, and gains from the sale
of investments. You receive such earnings as either an income dividend or a
capital gains distribution. Income dividends come from both the dividends that
the Fund earns from its holdings and interest it receives from its money market
and fixed income investments. Capital gains are realized when the Fund sells
securities for higher prices than it paid for them.]
[Side panel: When the fund makes a distribution to its shareholders, the share
price of the Fund drops by the amount of the distribution, net of any market
fluctuations.]
TAXES
Fund dividends and distributions are taxable to most investors (unless your
investment is in an IRA or other tax-advantaged account). Dividends paid by the
Fund out of net ordinary income and distributions of net short-term capital
gains are taxable to the shareholders as ordinary income. Distributions by the
Fund of net long-term capital gains to shareholders are generally taxable to the
shareholders at the applicable long-term capital gains rate, regardless of how
long the shareholder has held shares of the Fund.
<PAGE>
[Side panel: "Tax efficiency" is a measurement of how much of the Fund's net
assets are not subject to taxation due to the investment decisions of the
Adviser. In 1998 and 1999, the Fund was 100% tax efficient.]
You may realize a gain or loss when redeem shares of the Fund. The amount of the
gain or loss and the rate of tax will depend mainly upon the amount paid for the
shares, the amount received from the sale, and how long the shares were held.
The Fund's distributions may be subject to federal income tax whether received
in cash or reinvested in additional shares. In addition to federal taxes, you
may be subject to state and local taxes on distributions.
Because everyone's tax situation is unique, always consult your tax professional
about federal, state, and local tax consequences of an investment in the Fund.
IV. FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the Fund's
financial performance since its inception. Certain information reflects
financial results for a single Fund share. The total returns in the table
represent the rate you would have earned (or lost) on an investment in the Fund.
This information has been audited by McCurdy & Associates CPA's, Inc., whose
report, along with the Fund's financial statements, are included in the Fund's
annual report, which is available upon request and incorporated by reference in
the Statement of Additional Information.
Boyle Marathon Fund (for the period ended June 30, 1999)
Per Share Data for a Share Outstanding
For the Period ending June 30, 1999
Year Period (a)
Ended Ended
6/30/99 6/30/98
NET ASSET VALUE, BEGINNING OF PERIOD: $ 10.31 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................... (.05)
Net realized and unrealized
gains (losses) on investments .......... (.36)
Total from investment operations ............. .31
DISTRIBUTIONS:
Dividends (from net investment income) ... 0
Distributions (from capital gains) ....... 0
Total distributions .......................... 0
NET ASSET VALUE, END OF PERIOD: $14.61 $ 10.31
===== ====
TOTAL RETURN...................... 41.70% 8.84%(b)
<PAGE>
SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period .................... $ $ 985,259
Ratio of expenses to
average net assets(c) .................. %
6.86%(b)
Ratio of expenses to
average net assets(d) .................. %
4.26%(b)
Ratio of net investment income to
average net assets(c) .................. %
(4.15%)%(b)
Ratio of net investment income to
average net assets(d) .................. % (1.54)%(b)
Portfolio turnover rate .................. % 0%
(a) Represents the period from the commencement of
operations (Feb. 19, 1998) to June 30, 1998.
(b) Annualized.
(c) Before reimbursements.
(d) After reimbursements.
BOYLE MARATHON FUND
- --------------------------
BOARD OF TRUSTEES
Michael J. Boyle, Chairman
Joanne E. Boyle
James A. Hughes, Jr.
Edward J. Loftus
ADVISER AND ADMINISTRATOR Boyle Management and Research, Inc.
INDEPENDENT AUDITOR McCurdy & Associates CPA's, Inc.
TRANSFER AGENT, FUND ACCOUNTANT
AND DIVIDEND DISBURSING AGENT
Mutual Shareholder Services
<PAGE>
CUSTODIAN
Fifth Third Bank
[Back cover page]
BOYLE MARATHON FUND
- ------------------------
WHERE TO GO FOR INFORMATION
- ---------------------------
For shareholder inquiries, please call toll-free in the U.S. at 1-888-88-BOYLE
or 1-888-882-6953. You will find more information about the Boyle Marathon Fund
in the following documents:
ANNUAL AND SEMIANNUAL REPORTS
- -----------------------------
Our annual and semiannual reports list the holdings of the Fund, describe the
Fund's performance, include financial statements for the Fund, and discuss the
market conditions and strategies that significantly affected the Fund's
performance.
STATEMENT OF ADDITIONAL INFORMATION
- -----------------------------------
The Statement of Additional Information contains additional and more detailed
information about the Fund, and is considered to be a part of this Prospectus.
THERE ARE THREE WAYS TO GET A COPY OF THESE DOCUMENTS
- -----------------------------------------------------
1. Call or write for one, and a copy will be sent without charge.
Boyle Marathon Fund 850 Powell Street, Suite 104 San Francisco, CA 94108
1-888-88-BOYLE or 1-888-882-6953 www.boylefund.com
2. Call or write the Public Reference Section of the Securities and Exchange
Commission ("SEC") and ask them to mail you a copy. The SEC charges a fee for
this service. You can also visit the Public Reference Section and copy the
documents while you are there. Information about the Public Reference Section
may be obtained by calling the number below:
Public Reference Section of the SEC
Washington D.C. 20549-6009
1-800-SEC-0330
<PAGE>
3. Go to the SEC's website (www.sec.gov) and download a text-only version.
Boyle Marathon Fund - SEC file number 811-08501
- ------------------------------------------------
THE BOYLE MARATHON FUND
STATEMENT OF ADDITIONAL INFORMATION
August __, 1999
This Statement of Additional Information is not a Prospectus, but is
to be read in conjunction with the Prospectus of the Boyle Marathon Fund dated
August __, 1999. A copy of the Fund's Prospectus can be obtained by writing the
Fund at 850 Powell Street, Suite 104, San Francisco, California 94108, or by
calling the Fund at 1-415-693-0800.
TABLE OF CONTENTS
The Fund..................................................................
Definitions, Policies and Risk Considerations.............................
Quality Ratings of Corporate Bonds ....................
Investment Restrictions...................................................
Management of the Trust...................................................
Principal Security Holders................................................
Investment Advisory and Other Services....................................
Securities Transactions...................................................
Purchase, Redemption and Pricing of Shares................................
Performance Information...................................................
Taxes.....................................................................
Custodian.................................................................
Auditors..................................................................
Financial
Statement--..
Miscellaneous
Information.................................................
THE FUND
The Boyle Fund (the "Trust") was organized as a Delaware business trust in
October 1997. The Trust currently offers one series of shares to investors, The
Boyle Marathon Fund (the "Fund").
Each share of the Fund represents an equal proportionate interest in the
assets and liabilities of the Fund with each other share of the Fund and is
entitled to such dividends and distributions out of the income of the Fund as
are declared by the Trustees. The shares do not have cumulative voting rights or
any preemptive or conversion rights, and the Trustees have the authority from
time to time to divide or combine the shares of the Fund into a greater or
lesser number of shares of the Fund so long as the proportionate beneficial
interests in the assets of the Fund are in no way affected. In case of any
liquidation of the Fund, the holders of shares of the Fund will be entitled to
receive as a class a distribution out of the assets, net of the liabilities, of
the Fund. No shareholder is liable to further calls or to assessment by the Fund
without his express consent.
<PAGE>
DEFINITIONS, POLICIES AND RISK CONSIDERATIONS
A more detailed discussion of some of the terms used and investment
policies described in the Prospectus (see " Objective of the Fund," "Principal
Investment Strategies and Policies of the Fund," and Principal Risks of
Investing in the Fund" ) appears below:
BANK DEBT INSTRUMENTS. Bank debt instruments in which the Fund may invest
consist of certificates of deposit, bankers' acceptances and time deposits
issued by national banks and state banks, trust companies and mutual savings
banks, or by banks or institutions the accounts of which are insured by the
Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance
Corporation. Certificates of deposit are negotiable certificates evidencing the
indebtedness of a commercial bank to repay funds deposited with it for a
definite period of time (usually from 14 days to one year) at a stated or
variable interest rate. Bankers' acceptances are credit instruments evidencing
the obligation of a bank to pay a draft which has been drawn on it by a
customer, which instruments reflect the obligation both of the bank and of the
drawer to pay the face amount of the instrument upon maturity. Time deposits are
non-negotiable deposits maintained in a banking institution for a specified
period of time at a stated interest rate. The Fund will not invest in time
deposits maturing in more than seven days if, as a result thereof, more than 5%
of the value of its net assets would be invested in such securities and other
illiquid securities.
REPURCHASE AGREEMENTS. Repurchase agreements are transactions by which the
Fund purchases a security and simultaneously commits to resell that security to
the seller at an agreed upon time and price, thereby determining the yield
during the term of the agreement. In the event of a bankruptcy or other default
by the seller of a repurchase agreement, the Fund could experience both delays
in liquidating the underlying security and losses. To minimize these
possibilities, the Fund intends to enter into repurchase agreements only with
its Custodian, with banks having assets in excess of $10 billion and with
broker-dealers who are recognized as primary dealers in U.S. Government
obligations by the Federal Reserve Bank of New York. Collateral for repurchase
agreements is held in safekeeping in the customer-only account of the Fund's
Custodian at the Federal Reserve Bank. The Fund will not enter into a repurchase
agreement not terminable within seven days if, as a result thereof, more than 5%
of the value of its net assets would be invested in such securities and other
illiquid securities.
Although the securities subject to a repurchase agreement might bear
maturities exceeding one year, settlement for the repurchase would never be more
than one year after the Fund's acquisition of the securities and normally would
be within a shorter period of time. The resale price will be in excess of the
purchase price, reflecting an agreed upon market rate effective for the period
of time the Fund's money will be invested in the securities, and will not be
related to the coupon rate of the purchased security. At the time the Fund
enters into a repurchase agreement, the value of the underlying security,
including accrued interest, will equal or exceed the value of the repurchase
agreement, and, in the case of a repurchase agreement exceeding one day, the
seller will agree that the value of the underlying security, including accrued
interest, will at all times equal or exceed the value of the repurchase
agreement. The collateral securing the seller's obligation must be of a credit
quality at least equal to the Fund's investment criteria for portfolio
securities and will be held by the Custodian or in the Federal Reserve Book
Entry System.
For purposes of the Investment Company Act of 1940, as amended (the "1940
Act"), a repurchase agreement is deemed to be a loan from the Fund to the seller
subject to the repurchase agreement and is therefore subject to the Fund's
investment restriction applicable to loans. It is not clear whether a court
would consider the securities purchased by the Fund subject to a repurchase
agreement as being owned by the Fund or as being collateral for a loan by the
Fund to the seller. In the event of the commencement of bankruptcy or insolvency
proceedings with respect to the seller of the securities before repurchase of
the security under a repurchase agreement, the Fund may encounter delay and
incur costs before being able to sell the security. Delays may involve loss of
interest or decline in price of the security. If a court characterized the
transaction as a loan and the Fund has not perfected a security interest in the
security, the Fund may be required to return the security to the seller's estate
and be treated as an unsecured creditor of the seller. As an unsecured creditor,
the Fund would be at the risk of losing some or all of the principal and income
involved in the transaction. As with any unsecured debt obligation purchased for
the Fund, the Investment Adviser seeks to minimize the risk of loss through
repurchase agreements by analyzing the creditworthiness of the obligor, in this
case, the seller. Apart from the risk of bankruptcy or insolvency proceedings,
there is also the risk that the seller may fail to repurchase the security, in
which case the Fund may incur a loss if the proceeds to the Fund of the sale of
the security to a third party are less than the repurchase price. However, if
the market value of the securities subject to the repurchase agreement becomes
less than the repurchase price (including interest), the Fund will direct the
seller of the security to deliver additional securities so that the market value
of all securities subject to the repurchase agreement will equal or exceed the
repurchase price. It is possible that the Fund will be unsuccessful in seeking
to enforce the seller's contractual obligation to deliver additional securities.
MONEY MARKET SECURITIES. The Fund may under certain circumstances invest a
portion of its assets in money market funds. The 1940 Act prohibits the Fund
from investing more than 5% of the value of its total assets in any one
investment company, or more than 10% of the value of its total assets in
investment companies in the aggregate, and also restricts its investment in any
investment company to 3% of the voting securities of such investment company.
Investment in a money market fund involves payment of such fund's pro rated
share of advisory and administrative fees charged by such fund, in addition to
those paid by the Fund.
<PAGE>
FOREIGN SECURITIES. Subject to the Fund's investment policies and quality
standards, the Fund may invest in the securities of foreign issuers. Because the
Fund may invest in foreign securities, investment in the Fund involves risks
that are different in some respects from an investment in a fund, which invests
only in securities of U.S. domestic issuers. Foreign investments may be affected
favorably or unfavorably by changes in currency rates and exchange control
regulations. There may be less publicly available information about a foreign
company than about a U.S. company, and foreign companies may not be subject to
accounting, auditing and financial reporting standards and requirements
comparable to those applicable to U.S. companies. There may be less governmental
supervision of securities markets, brokers and issuers of securities. Securities
of some foreign companies are less liquid or more volatile than securities of
U.S. companies, and foreign brokerage commissions and custodian fees are
generally higher than in the United States. Settlement practices may include
delays and may differ from those customary in United States markets. Investments
in foreign securities may also be subject to other risks different from those
affecting U.S. investments, including local political or economic developments,
expropriation or nationalization of assets, restrictions on foreign investment
and repatriation of capital, imposition of withholding taxes on dividend or
interest payments, currency blockage (which would prevent cash from being
brought back to the United States), and difficulty in enforcing legal rights
outside the United States.
BORROWING. The use of borrowing by the Fund involves special risk
considerations that may not be associated with other funds having similar
policies. Since substantially all of the Fund's assets fluctuate in value,
whereas the interest obligation resulting from a borrowing will be fixed by the
terms of the Fund's agreement with its lender, the asset value per share of the
Fund will tend to increase more when its portfolio securities increase in value
and decrease more when its portfolio securities decrease in value than would
otherwise be the case if the Fund did not borrow funds. In addition, interest
costs on borrowings may fluctuate with changing market rates of interest and may
partially offset or exceed the return earned on borrowed funds. Under adverse
market conditions, the Fund might have to sell portfolio securities to meet
interest or principal payments at a time when fundamental investment
considerations would not favor such sales.
ILLIQUID SECURITIES. Historically, illiquid securities have included
securities subject to contractual or legal restrictions on resale because they
have not been registered under the Securities Act of 1933, as amended (the
"Securities Act"), securities which are otherwise not readily marketable and
securities such as repurchase agreements having a maturity of longer than seven
days. Securities which have not been registered under the Securities Act are
referred to as private placements or restricted securities and are purchased
directly from the issuer or in the secondary market. Mutual funds do not
typically hold a significant amount of these restricted or other illiquid
securities because of the potential for delays on resale and uncertainty in
valuation. Limitations on resale may have an adverse effect on the marketability
of portfolio securities and a mutual fund might be unable to dispose of
restricted securities promptly or at reasonable prices and might thereby
experience difficulty satisfying redemption requirements. A mutual fund might
also have to register such restricted securities in order to dispose of them,
resulting in additional expense and delay. Adverse market conditions could
impede such a public offering of securities.
In recent years, however, a large institutional market has developed
for certain securities that are not registered under the Securities Act
including repurchase agreements, commercial paper, foreign securities, municipal
securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The fact that
there are contractual or legal restrictions on resale to the general public or
to certain institutions may not be indicative of the liquidity of such
investments. The Board of Trustees may determine that such securities are not
illiquid securities notwithstanding their legal or contractual restrictions on
resale. In all other cases, however, securities subject to restrictions on
resale will be deemed illiquid.
The Fund does not intend presently to invest more than 5% of its net assets
in illiquid securities. In the event that the Fund's investments in illiquid
securities are deemed to exceed 5% of the Fund's net assets due to changes in
the liquidity of securities already held, the Fund will dispose of such
securities as soon as practicable in order to satisfy the 5% limitation.
<PAGE>
QUALITY RATINGS OF CORPORATE BONDS
The ratings of Moody's and Standard & Poor's for corporate bonds in which
the Fund may invest are as follows:
MOODY'S
Aaa - Bonds that are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.
Aa - Bonds that are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other elements present that
make the long-term risks appear somewhat larger than in Aaa securities.
A - Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may be
present which suggest a susceptibility to impairment sometime in the future.
Baa - Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.
STANDARD & POOR'S
AAA - Bonds rated AAA have the highest rating assigned by Standard & Poor's
to a debt obligation. Capacity to pay interest and repay principal is extremely
strong.
AA - Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.
A - Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than bonds in higher rated
categories.
BBB - Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
bonds in this category than for bonds in higher rated categories.
INVESTMENT RESTRICTIONS
The Fund has adopted the following investment restrictions as matters
of fundamental investment policy, which restrictions may not be changed without
the approval of a majority of the outstanding voting securities of the Fund. The
Fund may not:
1. Underwrite the securities of other issuers.
2. Purchase or sell real estate or interests in real estate, but the Fund
may purchase marketable securities of companies holding real estate or interests
in real estate.
3. Purchase or sell commodities or commodity contracts, including futures
contracts.
4. Make loans to other persons.
5. Purchase securities on margin.
6. Borrow money from banks except for temporary or emergency (not
leveraging) purposes, including the meeting of redemption requests that might
otherwise require the untimely disposition of securities, in an aggregate amount
not exceeding 5% of the value of the Fund's total assets at the time any
borrowing is made.
7. Purchase or sell puts and calls on securities.
<PAGE>
8. Make short sales of securities.
9. Participate on a joint or joint and several basis in any securities
trading account.
10. Purchase the securities of any other investment company except in
compliance with the 1940 Act.
11. Invest in or hold securities of any issuer if, to the knowledge of the
Fund, those officers and directors of the Fund or the Investment Adviser
(defined below) owning individually more than 1/2 of 1% of the securities of
such issuer together own more than 5% of the securities of such issuer.
In addition, it is a fundamental investment policy of the Fund,
which may not be changed without the approval of a majority of the outstanding
voting securities of the Fund, that the Fund will concentrate in equity
securities if companies in the high technology, financial services,
pharmaceutical, and retail fields.
With respect to the percentages adopted by the Fund as maximum limitations
on the Fund's investment policies and restrictions, an excess above the fixed
percentage will not be a violation of the policy or restriction unless the
excess results immediately and directly from the acquisition of any security or
the action taken.
MANAGEMENT OF THE TRUST
The business of the Trust is managed under the direction of the Board of
Trustees in accordance with the Certificate of Trust, which Certificate of Trust
has been filed with the Securities and Exchange Commission and is available upon
request. Pursuant to the Certificate of Trust, the Trustees elect a Chairman,
who appoints officers, including a President, and a Chief Financial Officer. The
Board of Trustees retains the power to conduct, operate and carry on the
business of the Trust and has the power to incur and pay any expenses, which in
the opinion of the Board of Trustees are necessary or incidental to carry out
any of the Trust's purposes. The Trustees, officers, employees and agents of the
Trust, when acting in such capacities, shall not be subject to any personal
liability except for his or her own bad faith, willful misfeasance, gross
negligence or reckless disregard of his or her duties. Following is a list of
the Trustees and executive officers of the Trust and their current annual
compensation from the Trust.
NAME AGE POSITION HELD COMPENSATION
*Michael J. Boyle 51 Trustee/President $0
*Joanne E. Boyle 51 Trustee/Chief Financial Officer $0
James A. Hughes, Jr. 68 Trustee $0
Edward Loftus 32 Trustee $0
Mr. Boyle and Mr. Loftus are first cousins.
* This Trustee is an "interested person" (as defined in section 2(a)(19) of the
1940 Act) by virtue of his affiliation with the Investment Adviser.
The principal occupations of the Trustees and officers of the Fund during the
past five years are set forth below:
MICHAEL J. BOYLE, 850 Powell Street, Suite 104, San Francisco, California
94108 is the Founder and has been President of Boyle Management and Research,
Inc. since founding it in October 1997. From April 1990-June 1996, Mr. Boyle
was the Vice President of Business Development for a division of Harris
Corporation, an information processing and communication company; from July 1996
to January 1997, Mr. Boyle was Senior Counsel for Harris Corporation. Mr. Boyle
was a consultant from January 1997 to October 1997.
JOANNE E. BOYLE, 850 Powell Street, Suite 104, San Francisco,
California 94108 is the Co-Founder and has been the Chief Financial Officer of
Boyle Management and Research, Inc. since its founding in October 1997. From
August 1983 to December 1997, she served as President of Deck the Walls, a
privately owned retail store in Melbourne, Florida.
JAMES A. HUGHES, JR., 1111 Dorset Drive, West Chester, Pennsylvania 19382
is currently a Private Investor; prior to this he served as a Vice President of
ORA of Mt. Laurel, New Jersey, from February 1993 to June 1994; and prior to
this, he served as Vice-President of Manchester, Wilmington, Delaware from May
1992 to January 1993.
<PAGE>
EDWARD LOFTUS, P.O. Box 836, Clarks Summit, PA 18411, is currently Project
Manager for the Prudential Insurance Co. Prior to that he was the President of
the Loftus Insurance Agency, Inc.; he served in this capacity from January 1995
to June 1999; prior to that, he was a District Manager for Akzo Nobel, NA from
June 1993 to December 1994.
PRINCIPAL SECURITY HOLDERS
As of June 30, 1999, 62.7% of the outstanding shares of the
Fund were owned by the officers and Trustees of the Fund. No other
shareholder owns 5% or more of the Fund. A shareholder who beneficially
owns, directly or indirectly, 25% of the Fund's voting securities may be
deemed a "control person" (as defined in the 1940 Act) of the Fund. Boyle
Management and Research, Inc. is controlled by Michael J. Boyle, Trustee
and President of the Trust, and Joanne E. Boyle, Trustee and Chief
Financial Officer of the Trust.
INVESTMENT ADVISORY AND OTHER SERVICES
THE INVESTMENT ADVISER
Boyle Management and Research, Inc., a California corporation, 850 Powell
Street, Suite 104, San Francisco, California 94108 (the "Investment Adviser"),
is registered as an investment adviser with the Securities and Exchange
Commission under the Investment Advisers Act of 1940. The Investment Adviser is
controlled and wholly owned by Michael J. and Joanne E. Boyle.
The Investment Advisory and Management Agreement (the "Advisory Agreement")
between the Trust and the Investment Adviser was approved by the Board of
Trustees of the Trust, including a majority of the Trustees who were not a party
to the Advisory Agreement or "interested persons" (as defined in the 1940 Act)
of a party to the Advisory Agreement, at a Board of Trustees meeting held on
December 27, 1998.
Under the Advisory Agreement, the Investment Adviser (i) manages the
investment operations of the Fund and the composition of its portfolio,
including the purchase, retention and disposition of securities in accordance
with the Fund's investment objective, (ii) provides all statistical, economic
and financial information reasonably required by the Fund and reasonably
available to the Investment Adviser, (iii) provides the Custodian of the Fund's
securities on each business day with a list of trades for that day, and (iv)
provides persons satisfactory to the Trust's Board of Trustees to act as
officers and employees of the Trust.
By its terms, the Advisory Agreement remains in force from year to year,
subject to annual approval by (a) the Board of Trustees or (b) a vote of the
majority of the Fund's outstanding voting securities; provided that in either
event continuance is also approved by a majority of the Trustees who are not
interested persons of the Trust, by a vote cast in person at a meeting called
for the purpose of voting such approval. The Advisory Agreement may be
terminated at any time, on 60 days' written notice, without the payment of any
penalty, by the Board of Trustees, by a vote of the majority of the Fund's
outstanding voting securities, or by the Investment Adviser. The Advisory
Agreement automatically terminates in the event of its assignment, as defined by
the 1940 Act and the applicable rules.
Pursuant to the Advisory Agreement, the Fund pays to the
Investment Adviser, on a monthly basis, an advisory fee equal to 1.5% per annum
of the Fund's average daily net assets.
The Investment Adviser may act as an investment adviser to other
persons, firms or corporations (including investment companies), and may have
numerous advisory clients in addition to the Fund.
THE ADMINISTRATION AGREEMENT
The Board of Trustees of the Trust has approved an Administration Agreement
with the Investment Adviser wherein the Investment Adviser is responsible for
the provision of administrative and supervisory services to the Fund. The
Investment Adviser, at its expense, shall supply the Trustees and the officers
of the Fund with all statistical information and reports reasonably required by
it and reasonably available to the Investment Adviser. The Investment Adviser
shall oversee the maintenance of all books and records with respect to the
Fund's security transactions and the Fund's book of account in accordance with
all applicable federal and state laws and regulations. The Investment Adviser
will arrange for the preservation of the records required to be maintained by
the 1940 Act.
<PAGE>
Pursuant to the Administration Agreement, the Fund will pay to the
Investment Adviser, on a monthly basis, a fee equal to 1% per annum of the
Fund's average daily net assets.
The Administration Agreement may be terminated by the Trust at any time, on
60 days' notice to the Investment Adviser, without penalty either (1) by vote of
the Board of Trustees of the Trust, or (2) by vote of a majority of the
outstanding voting securities of the Fund. It may be terminated at any time by
the Investment Adviser on 60 days' written notice to the Trust.
MAXUS INFORMATION SYSTEMS, INC.
Maxus Information Services, Inc. ("Maxus"), doing business as Mutual
Shareholder Services, The Tower at Erieview, 10th Floor, 1301 East Ninth Street,
Cleveland, Ohio 44114, is retained by the Investment Adviser to maintain the
records of each shareholder's account, process purchases and redemptions of the
Fund's shares and act as dividend and distribution disbursing agent. Maxus also
provides administrative services to the Fund, calculates daily net asset value
per share and maintains such books and records as are necessary to enable Maxus
to perform its duties. For the performance of these services, the Investment
Adviser (not the Fund) pays Maxus a fee which will vary with the number of
States in which the Fund elects to do business; a fee for transfer agency and
shareholder services at the annual rate per shareholder account of the Fund
(subject to a minimum fee); and a monthly fee for accounting and pricing
services which will vary according to the Fund's average net assets during such
month (subject to a minimum fee). Maxus is a wholly owned subsidiary of Resource
Management, Inc., an Ohio corporation with interests primarily in the financial
services industry.
SECURITIES TRANSACTIONS
The Investment Adviser furnishes advice and recommendations with respect to
the Fund's portfolio decisions and, subject to the supervision of the Board of
Trustees of the Trust, determines the broker to be used in each specific
transaction. In executing the Fund's portfolio transactions, the Investment
Adviser seeks to obtain the best net results for the Fund, taking into account
such factors as the overall net economic result to the Fund (involving both
price paid or received and any commissions and other costs paid), the efficiency
with which the specific transaction is effected, the ability to effect the
transaction where a large block is involved, the known practices of brokers and
the availability to execute possibly difficult transactions in the future and
the financial strength and stability of the broker. While the Investment Adviser
generally seeks reasonably competitive commission rates, the Fund does not
necessarily pay the lowest commission or spread available.
The Investment Adviser may direct the Fund's portfolio transactions to
persons or firms because of research and investment services provided by such
persons or firms if the amount of commissions in effecting the transactions is
reasonable in relationship to the value of the investment information provided
by those persons or firms. Such research and investment services are those that
brokerage houses customarily provide to institutional investors and include
statistical and economic data and research reports on particular companies and
industries. These services may be used by the Investment Adviser in connection
with all of its investment activities, and some of the services obtained in
connection with the execution of transactions for the Fund may be used in
managing the Investment Adviser's other investment accounts.
The Fund may deal in some instances in securities that are not listed on a
national securities exchange but are traded in the over-the-counter market. It
may also purchase listed securities through the "third market" (i.e., other than
on the exchanges on which the securities are listed). When transactions are
executed in the over-the-counter market or the third market, the Investment
Adviser will seek to deal with primary market makers and to execute transactions
on the Fund's own behalf, except in those circumstances where, in the opinion of
the Investment Adviser, better prices and executions may be available elsewhere.
The Fund does not allocate brokerage business in return for sales of the Fund's
shares.
Neither the Investment Adviser nor any affiliated person thereof will
participate in commissions paid by the Fund to brokers or dealers or will
receive any reciprocal business, directly or indirectly, as a result of such
commissions. The Fund will not pay mark-ups.
The Board of Trustees reviews periodically the allocation of brokerage
orders to monitor the operation of these policies.
<PAGE>
PURCHASE, REDEMPTION AND PRICING OF SHARES
CALCULATION OF SHARE PRICE
The share price (net asset value) of the shares of the Fund is determined
as of the close of the regular session of trading on the New York Stock Exchange
(normally 4:00 p.m., Eastern Time), on each day the Fund is open for business.
Net asset value also may be determined on other days in which there is
sufficient trading in the Fund's portfolio securities that its net asset value
might be materially affected. For a description of the methods used to determine
the share price, see "Calculation of Share Price" in the Prospectus.
In valuing the Fund's assets for the purpose of determining net asset
value, readily marketable portfolio securities listed on a national securities
exchange are valued at the last sale price on such exchange on the business day
as of which such value is being determined. If there has been no sale on such
exchange on such day, the security is valued at the closing bid price on such
day. If no bid price is quoted on such exchange on such day, then the security
is valued by such method as the Investment Adviser under the supervision of the
Board of Trustees determines in good faith to reflect its fair value. Readily
marketable securities traded only in the over-the-counter market are valued at
the current bid price. If no bid price is quoted on such day, then the security
is valued by such method as the Investment Adviser under the supervision of the
Board of Trustees determines in good faith to reflect its fair value. All other
assets of the Fund, including restricted securities and securities that are not
readily marketable, are valued in such manner as the Investment Adviser under
the supervision of the Board of Trustees in good faith deems appropriate to
reflect their fair value.
PURCHASE OF SHARES
Orders for shares received by the Fund in proper form prior to the close of
business on the New York Stock Exchange (the "Exchange") on each day during such
periods that the Exchange is open for trading are priced at net asset value per
share computed as of the close of the Exchange at day's end. Orders received in
proper form after the close of the Exchange, or on a day it is not open for
trading, are priced at the close of such Exchange on the next day on which it is
open for trading at the next determined net asset value per share.
REDEMPTION OF SHARES
The right of redemption may not be suspended or the date of payment upon
redemption postponed for more than seven calendar days after a shareholder's
redemption request is made in accordance with the procedures set forth in the
Prospectus, except for any period during which the Exchange is closed (other
than customary weekend and holiday closing) or during which the Securities and
Exchange Commission determines that trading thereon is restricted, or for any
period during which an emergency (as determined by the Securities and Exchange
Commission) exists as a result of which disposal by the Fund of securities owned
by it is not reasonably practicable or as a result of which it is not reasonably
practicable for the Fund to fairly determine the value of its net assets, or for
such other period as the Securities and Exchange Commission may by order permit
for the protection of security holders of the Fund.
The Fund will redeem all or any portion of a shareholder's shares of the
Fund when requested in accordance with the procedures set forth in the "How to
Redeem Shares" section of the Prospectus.
REDEMPTION IN KIND
Payment of the net redemption proceeds may be made either in cash or in
portfolio securities (selected in the discretion of the Investment Adviser under
supervision of the Board of Trustees and taken at their value used in
determining the net asset value), or partly in cash and partly in portfolio
securities. However, payments will be made wholly in cash unless the Board of
Trustees believes that economic conditions exist which would make such a
practice detrimental to the best interests of the Fund. If payment for shares
redeemed is made wholly or partly in portfolio securities, brokerage costs may
be incurred by the investor in converting the securities to cash.
PERFORMANCE INFORMATION
The Fund's total returns are based on the overall dollar or percentage
change in value of a hypothetical investment in the Fund, assuming all dividends
and distributions are reinvested. Average annual total return reflects the
hypothetical annually compounded return that would have produced the same
cumulative total return if the Fund's performance had been constant over the
entire period presented. Because average annual total returns tend to smooth out
variations in the Fund's returns, investors should recognize that they are not
the same as actual year-by-year returns.
<PAGE>
For the purposes of quoting and comparing the performance of the Fund to
that of other mutual funds and to other relevant market indices in
advertisements, performance will be stated in terms of average annual total
return. Under regulations adopted by the Securities and Exchange Commission,
funds that intend to advertise performance must include average annual total
return quotations calculated according to the following formula:
P (1+T) n = ERV
Where:
P = a hypothetical initial payment of $1,000 T = average annual total
return n = number of years (1, 5, or 10)
ERV = ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the 1-, 5-, or 10-
year period, at the end of such period (or fractional portion thereof).
Under the foregoing formula, the time periods used in advertising will be
based on rolling calendar quarters, updated to the last day of the most recent
quarter prior to submission of the advertising for publication, and will cover
1, 5, and 10 year periods of the Fund's existence or shorter periods dating from
the commencement of Fund registration. In calculating the ending redeemable
value, all dividends and distributions by the Fund are assumed to have been
reinvested at net asset value as described in the Prospectus on the reinvestment
dates during the period. Additionally, redemption of shares is assumed to occur
at the end of each applicable time period.
The foregoing information should be considered in light of the Fund's
investment objectives and policies, as well as the risks incurred in the Fund's
investment practices. Future results will be affected by the future composition
of the Fund's portfolio, as well as by changes in the general level of interest
rates, and general economic and other market conditions.
The Fund may also advertise total return (a "nonstandardized quotation")
which is calculated differently from average annual total return. A
nonstandardized quotation of total return may be a cumulative return which
measures the percentage change in the value of an account between the beginning
and end of a period, assuming no activity in the account other than reinvestment
of dividends and capital gains distributions.
A nonstandardized quotation may also indicate average annual compounded
rates of return over periods other than those specified for average annual total
return. A nonstandardized quotation of total return will always be accompanied
by the Fund's average annual total return as described above.
The performance quotations described above are based on historical earnings
and are not intended to indicate future performance.
To help investors better evaluate how an investment in the Fund might
satisfy their investment objective, advertisements regarding the Fund may
discuss various measures of Fund performance, including current performance
ratings and/or rankings appearing in financial magazines, newspapers and
publications which track mutual fund performance. Advertisements may also
compare performance (using the calculation methods set forth in the Prospectus)
to performance as reported by other investments, indices and averages. When
advertising current ratings or rankings, the Fund may use the following
publications or indices to discuss or compare Fund performance:
Lipper Mutual Fund Performance Analysis measures total return and average
current yield for the mutual fund industry and ranks individual mutual fund
performance over specified time periods assuming reinvestment of all
distributions, exclusive of sales loads. The Fund may provide comparative
performance information appearing in the Lipper Growth and Income Fund category.
Morningstar measures performance in the same way and currently puts the fund in
the Morningstar Large Cap Blend Fund category. In addition, the Fund may use
comparative performance information of relevant indices, including the S&P 500
Index, the Dow Jones Industrial Average, the Russell 2000 Index, the NASDAQ
Composite Index and the Value Line Composite Index. The S&P 500 Index is an
unmanaged index of 500 stocks, the purpose of which is to portray the pattern of
common stock price movement. The Dow Jones Industrial Average is a measurement
of general market price movement for 30 widely held stocks listed on the New
York Stock Exchange. The Russell 2000 Index, representing approximately 11% of
the U.S. equity market, is an unmanaged index comprised of the 2,000 smallest
U.S. domiciled publicly-traded common stocks in the Russell 3000 Index (an
unmanaged index of the 3,000 largest U.S. domiciled publicly-traded common
stocks by market capitalization representing approximately 98% of the U.S.
publicly-traded equity market). The NASDAQ Composite Index is an unmanaged
index, which averages the trading prices of more than 3,000 domestic
over-the-counter companies. The Value Line Composite Index is an unmanaged index
comprised of approximately 1,700 stocks, the purpose of which is to portray the
pattern of common stock price movement.
<PAGE>
In assessing such comparisons of performance an investor should keep in
mind that the composition of the investments in the reported indices and
averages is not identical to the Fund's portfolio, that the averages are
generally unmanaged and that the items included in the calculations of such
averages may not be identical to the formula used by the Fund to calculate its
performance. In addition, there can be no assurance that the Fund will continue
this performance as compared to such other averages.
TAXES
The Fund has elected, and intends to qualify annually, for the special tax
treatment afforded a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"). To qualify as a
regulated investment company, the Fund must, among other things, (a) derive in
each taxable year at least 90% of its gross income from dividend, interest,
payments with respect to securities loans, and gains from the sale or other
disposition of stock, securities or foreign currencies, or other income
(including gains from options, futures and forward contracts) derived with
respect to its business of investing in such stock, securities or currencies;
(b) derive in each taxable year less than 30% of its gross income from the sale
or other disposition of certain assets held less than three months, namely (1)
stocks or securities, (2) options, futures or forward contracts (other than
those on foreign currencies), and (3) foreign currencies (or options, futures
and forward contracts on foreign currencies) not directly related to the
business of investing in stocks and securities; (c) diversify its holdings so
that, at the end of each quarter of the taxable year, (i) at least 50% of the
market value of the Fund's assets is represented by cash, U.S. Government
securities, the securities of other regulated investment companies, and other
securities, with such other securities of any one issuer limited for the
purposes of this calculation to an amount not greater than 5% of the value of
the Fund's total assets and 10% of the outstanding voting securities of such
issuer, and (ii) not more than 25% of the value of its total assets is invested
in the securities of any one issuer (other than U.S. Government securities or
the securities of other regulated investment companies) or in two or more
issuers which the Fund controls and which are engaged in the same or similar
trades or businesses; and (d) distribute at least 90% of its investment company
taxable income (which includes dividends, interest and net short-term capital
gains in excess of any net long-term capital losses) each taxable year.
As a regulated investment company, the Fund will not be subject to U.S.
Federal income tax on its investment company taxable income and net capital
gains (any long-term capital gains in excess of the sum of net short-term
capital losses and capital loss carryovers available from the eight prior
years), if any, that it distributes to shareholders. The Fund intends to
distribute annually to its shareholders substantially all of its investment
company taxable income and any net capital gains. In addition, amounts not
distributed by the Fund on a timely basis in accordance with a calendar year
distribution requirement are subject to a nondeductible 4% excise tax. To avoid
the tax, the Fund must distribute during each calendar year an amount equal to
the sum of (1) at least 98% of its ordinary income (with adjustment) and its net
capital gain (not taking into account any capital gains or losses from sales and
exchanges) for the calendar year and (2) at least 98% of its capital gains in
excess of its capital losses (and adjusted for certain ordinary losses) for the
12 month period ending on October 31 of the calendar year, and (3) all ordinary
income and capital gains for previous years that were not distributed during
such years. In order to avoid application of the excise tax, the Fund intends to
make distributions in accordance with these distribution requirements.
Corporate shareholders should be aware that availability of the dividends
received deduction is subject to certain restrictions. For example, the
deduction is not available if Fund shares are deemed to have been held for less
than 46 days and is reduced to the extent such shares are treated as
debt-financed under the Code. Dividends, including the portions thereof
qualifying for the dividends received deduction, are includible in the tax base
on which the federal alternative minimum tax is computed. Dividends of
sufficient aggregate amount received during a prescribed period of time and
qualifying for the dividends received deduction may be treated as "extraordinary
dividends" under the Code, resulting in a reduction in a corporate shareholder's
federal tax basis in its Fund shares.
The Fund may invest as much as 5% of its net assets in securities of
foreign companies and may therefore be liable for foreign withholding and other
taxes, which will reduce the amount available for distribution to shareholders.
Tax conventions between the United States and various other countries may reduce
or eliminate such taxes. A foreign tax credit or deduction is generally allowed
for foreign taxes paid or deemed to be paid. A regulated investment company may
elect to have the foreign tax credit or deduction claimed by the shareholders
rather than the company if certain requirements are met, including the
requirement that more than 50% of the value of the company's total assets at the
end of the taxable year consist of securities in foreign corporations. Because
the Fund does not anticipate investment in securities of foreign corporations to
this extent, the Fund will likely not be able to make this election and foreign
tax credits will be allowed only to reduce the Fund's tax liability, if any.
The Fund may also be subject to special rules under the Code that apply to
income derived from stock issued by a "passive foreign investment company" (or
PFIC), which might subject the Fund to a non-deductible federal income tax. The
Fund may be able to avoid this tax by electing to be taxed on its share of the
PFIC's income (whether or not such income is actually distributed by the PFIC).
The Fund will endeavor to limit its exposure to the PFIC tax by investing in
PFICs only where the election to be taxed currently will be made. Because it is
not always possible to identify a foreign issuer as a PFIC before an investment
is made, however, the Fund may incur the PFIC tax in some instances.
<PAGE>
Under the Code, upon disposition of securities denominated in a foreign
currency, gains or losses attributable to fluctuations in the value of the
foreign currency between the date of acquisition of the securities and the date
of disposition are treated as ordinary gain or loss. These gains or losses
referred to under the Code as "Section 988" gains or losses, may increase or
decrease the amount of the Fund's investment company taxable income.
Any dividend or distribution received shortly after a share purchase will
have the effect of reducing the net asset value of such shares by the amount of
such dividend or distribution. Such dividend or distribution is fully taxable.
Accordingly, prior to purchasing shares of the Fund, an investor should
carefully consider the amount of dividends or capital gains distributions, which
are expected to be or have been announced.
Provided that the Fund qualifies as a regulated investment company
under the Code, it will not be liable for California corporate taxes, other than
a minimum franchise tax, if all of its income is distributed to shareholders for
each taxable year.
The above discussion and the related discussion in the Prospectus are not
intended to be complete discussions of all applicable federal tax consequences
of an investment in the Fund. No law firm has expressed an opinion in respect
thereof. Nonresident aliens and foreign persons are subject to different tax
rules, and may be subject to withholding of up to 30% on certain payments
received from the Fund. Shareholders are advised to consult with their own tax
advisors concerning the application of foreign, federal, state and local taxes
to an investment in the Fund.
CUSTODIAN
Fifth Third Bank, 38 Fountain Square Plaza, Cincinnati, Ohio 45263, has
been retained to act as Custodian for the Fund's investments. Fifth Third Bank
acts as the Fund's depository, keeps safe its portfolio securities, collects all
income and other payments with respect thereto, disburses funds as instructed
and maintains records in connection with its duties.
AUDITORS
The firm of McCurdy & Associates CPA's, Inc. 27955 Clemens Road, Westlake,
Ohio 44145 has been selected as independent auditors for the Fund. McCurdy &
Associates performed the annual audit of the Fund's financial statements and
advises the Fund on certain accounting matters.
FINANCIAL STATEMENT
[Something similar to this will be filed in August.]
To The Shareholders and Trustees
The Boyle Fund
We have audited the accompanying statement of assets and liabilities of The
Boyle Fund (comprised of The Boyle Marathon Fund) as of June 30, 1999. This
financial statement is the responsibility of the Company's management. Our
responsibility is to express an opinion on this financial statement based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of assets and liabilities is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the statement of assets and
liabilities. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
statement of assets and liabilities presentation. Our procedures included
confirmation of cash held by the custodian as of June 30, 1999, by
correspondence with the custodian. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the statement of assets and liabilities referred to above
presents fairly, in all material respects, the financial position of The Boyle
Marathon Fund as of June 30, 1999, in conformity with generally accepted
accounting principles.
<PAGE>
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
June 30, 1999
THE BOYLE FUND
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1999
The Boyle
Marathon Fund
ASSETS:
Cash in Bank $
Organization Costs
Total Assets
LIABILITIES:
Note Payable
Total Liabilities
NET ASSETS $
NET ASSETS CONSIST OF:
Capital Paid In $
OUTSTANDING SHARES
Unlimited Number of Shares
Authorized Without Par Value
NET ASSET VALUE PER SHARE $
OFFERING PRICE PER SHARE $
See Accountants' Audit Report
THE BOYLE FUND
NOTES TO FINANCIAL STATEMENTS
January 30, 1998
1. ORGANIZATION
The Boyle Fund (the "Trust") is an open-end management investment company
organized as a business trust under the laws of the State of Delaware by a
Declaration of Trust dated October 24, 1997. The Declaration of Trust provides
for an unlimited number of authorized shares of beneficial interest, which may,
without shareholder approval, be divided into an unlimited number of series of
such shares, and which presently consist of one series of shares for The Boyle
Marathon Fund.
The Fund uses an independent custodian and transfer agent.
<PAGE>
2. RELATED PARTY TRANSACTIONS
As of June 30, 1999, __% of the outstanding shares of the Fund were owned by
the Trustees and Officers of the Fund. A shareholder who beneficially owns,
directly or indirectly, more than 25% of the Fund's voting securities may be
deemed a "control person" (as defined in the 1940 Act) of the Fund. Boyle
Management & Research, Inc. is controlled by Michael J. Boyle, the Chairman of
the Fund.
Boyle Management & Research, Inc., the Fund's investment adviser, is
registered as an investment adviser under the
Investment Advisers Act of 1940.
As compensation for Boyle Management & Research, Inc.'s services rendered to
the Fund, such Fund pays a fee, computed and paid monthly, at an annual rate of
1-1/2% of the Fund's daily net assets. This fee is higher than that paid by most
other investment companies.
3. CAPITAL STOCK AND DISTRIBUTION
4. NOTE PAYABLE
Note payable consists of a note payable to Boyle Management & Research, Inc.
at 8% payable monthly for five years for the Fund.
These notes are stated at cost. The Fund does not believe it is practicable
to estimate fair value as the cost to provide such value would exceed the
benefit.
The principle due for the next five years for each Fund.
FYE 1997 $ 1,345
1998 3,229
1999 3,229
2000 3,229
2001 3,229
2002 1,886
$16,147
5. ORGANIZATION COSTS
Organization costs are being amortized on a straight line basis over a
five-year period.
MISCELLANEOUS INFORMATION
This Statement of Additional Information and the Prospectus do not
contain all the information included in the Trust's registration statement filed
with the Securities and Exchange Commission under the Securities Act with
respect to the securities offered hereby, certain portions of which have been
omitted pursuant to the rules and regulations of the Securities and Exchange
Commission. The registration statement, including the exhibits filed therewith,
may be examined at the offices of the Securities and Exchange Commission in
Washington, D.C.
Statements contained herein and in the Prospectus as to the contents
of any contract or other documents referred to are not necessarily complete,
and, in each instance, reference is made to the copy of such contract or other
documents filed as an exhibit to the registration statement, each such statement
being qualified in all respects by such reference.
<PAGE>
PART C OTHER INFORMATION - - Financial Statements and Exhibits
(a) Financial Statement - - Balance Sheet of the Fund dated June 30,
1999**
(b) Exhibits
(1) Certificate of Trust *
(2) By-Laws *
(3) Inapplicable
(4) Inapplicable
(5) Advisory Agreement - Boyle Management and Research, Inc. *
(6) Inapplicable
(7) Inapplicable
(8) Custody Agreement with Fifth Third Bank*
(9) Administration Agreement with Boyle Management and Research,Inc.*
(10) Opinion and Consent of Counsel relating to Issuance of Shares*
(11) Consent of Independent Public Accountants**
(12) Inapplicable
(13) Agreement Relating to Initial Capital *
(14) Prototype Individual Retirement Account*
(15) Inapplicable
(16) Inapplicable
(17) Financial Data Schedule for Electronic Filers**
(18) Inapplicable
* Previously filed.
** To be filed in August 1999
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT.
No person is directly or indirectly controlled by or under common
control with the Registrant.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES.
As of June 30, 1999, the Fund had 75 shareholders of record.
<PAGE>
ITEM 27. INDEMNIFICATION.
Under section 3817(a) of the Delaware Business trust Act, a Delaware
Business trust has the power to indemnify and hold harmless any trustee,
beneficial owner or other person from and against any and all claims and demands
whatsoever. Reference is made to Article V of the Certificate of Trust of The
Boyle Fund (the "Trust")(Exhibit 1) pursuant to which no trustee, officer,
employee or agent of the Trust shall be subject to any personal liability to the
maximum extent permitted by law. Further, reference is also made to Section 11.1
the By-Laws of the Trust (Exhibit 2), which provides that the Trust shall
indemnify each of its trustees, officers, employees and agents against all
liabilities and expenses reasonably incurred by him or her in connection with
the defense or disposition of any actions, suits or other proceedings by reason
of his or her being or having been a trustee, officer, employee or agent, except
with respect to any matter as to which he or she shall have been adjudicated to
have acted in or with bad faith, willful misfeasance, gross negligence or
reckless disregard of his or her duties. The Trust will comply with Section
17(h) of the Investment Company Act of 1940, as amended (the "1940 Act") and
1940 Act Releases number 7221 (June 9, 1972) and number 11330 (September 2,
1980).
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers and controlling
persons of the Trust pursuant to the foregoing, the Trust has been advised that
in the opinion of the Securities and Exchange Commission, such indemnification
is against public policy and therefore may be unenforceable. In the event that a
claim for indemnification (except insofar as it provides for the payment by the
Trust of expenses incurred or paid by a trustee, officer or controlling person
in the successful defense of any action, suit or proceeding) is asserted against
the Trust by such trustee, officer or controlling person and the Securities and
Exchange Commission is still of the same opinion, the Trust will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
Indemnification provisions exist in the Investment Advisory and
Management Agreement, Administration Agreement and Custodian Agreement which
agree to indemnify the parties the agreements for all actions related to their
official duties except for actions taken in bad faith, gross negligence, or
willful misfeasance, or willful disregard of his or her duties.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT
ADVISER
(a) Michael J. Boyle was a self employed consultant from January 1997
to October 1997; prior to that, Mr. Boyle was Senior Counsel with Harris
Corporation, an electronics and communication company headquartered in
Melbourne, Florida from July 1996 to January 1997; prior to that, Mr. Boyle was
a Vice-President of Business Development for an operating division of Harris
Corporation from April 1990 to June 1996.
(b) Joanne E. Boyle was President of Deck the Walls, a privately
owned retail store in Melbourne, Florida from August 1983 to December 1997.
ITEM 29. PRINCIPAL UNDERWRITERS.
(a) Inapplicable
(b) Inapplicable
(c) Inapplicable
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS.
Accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules promulgated
thereunder will be maintained by the Registrant at its offices located at 850
Powell Street, Suite 104, San Francisco, California 94108, at the offices of the
Registrant's Transfer Agent located at The Tower at Erieview, 10th Floor, 1301
East Ninth Street, Cleveland, Ohio 44114, and at the offices of the Custodian at
38 Fountain Square Plaza, Cincinnati, Ohio 45263.
<PAGE>
ITEM 31. MANAGEMENT SERVICES NOT DISCUSSED IN PARTS A AND B.
Inapplicable
ITEM 32. UNDERTAKINGS.
(a) Inapplicable
(b) Inapplicable
(c) The Registrant undertakes that, if so requested, it will furnish
each person to whom a prospectus is delivered with a copy of Registrant's latest
annual report to shareholders without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed below on its behalf by the undersigned, thereunto duly
authorized, in the City of San Francisco and the State of California on the 3th
of July 1999.
THE BOYLE FUND
By: /S/ Michael J. Boyle
Michael J. Boyle, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
/S/ MICHAEL J. BOYLE President and July 3, 1999
- ----------. Trustee
Michael J. Boyle
/S/ JOANNE E. BOYLE Chief Financial Officer July 3, 1999
- ---------- and Trustee
Joanne E. Boyle
/S/ JAMES A. HUGHES, JR. Trustee July 10, 1999
- -----------...
James A. Hughes, Jr.
/S/ EDWARD LOFTUS Trustee July 10, 1999
- ---------...
Edward Loftus
<PAGE>
