INFORMATION REQUIRED IN A PROSPECTUS
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PROSPECTUS Bridges Investment Fund, Inc. CAPITAL STOCK
April 29, 1996 8401 West Dodge Road
Omaha, Nebraska 68114
402-397-4700
Investment Objectives
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The primary investment objective of the Fund is long-term capital
appreciation. The development of a modest amount of current income is a
secondary investment objective.
Portfolio Investments
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The Fund intends to achieve its investment objectives through the ownership
of common stocks, securities convertible into common stocks, and fixed income
securities. The non-convertible fixed income securities issued by corporations
may not account for more than 40% of the market value of the Fund's portfolio.
Purchase Price
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Shares of capital stock are offered to the public by the Fund at the next
determined Net Asset Value which varies with the changes in the market value of
the Fund's portfolio.
No Selling Commissions
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The Fund receives the full amount paid by purchasers of these shares since
there are no underwriting discounts or selling charges paid to anyone. However,
service charges are imposed on certain Plan account operations as described on
pages 18 and 20.
Purchase Plans
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The Fund requires a minimum initial investment of $800.00. Shares can be
purchased for lesser amounts under the Reinvestment of Cash Distributions Plan
and Scheduled Investments Plan as described in this Prospectus. In addition,
Individual Retirement Custodian Accounts (IRA) and Standard Retirement Plans
are available to individuals, partnerships, and corporations. As set forth
herein, there are certain transaction charges by First Bank N.A. Omaha,
Nebraska as investor's agent in connection with investments and reinvestments
under such Plans.
Redemption Price
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Shares of capital stock of the Fund are redeemed at current Net Asset Value
next determined, which varies with the changes in market value of securities
owned.
Bridges Investment Fund, Inc. 2 April 29, 1996
Prospectus -- Part A
Investment Adviser
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The investment adviser to and manager for the Fund is Bridges Investment
Counsel, Inc., 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114.
Special Notices
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This Prospectus sets forth concisely the information about Bridges
Investment Fund, Inc. that a prospective investor ought to know before
investing. This Prospectus should be retained for future reference. Additional
information has been filed with the Securities and Exchange Commission,
Washington, D.C. 20549, in two segments: Part B--Information Required in a
Statement of Additional Information and Part C--Other Information. Descriptions
of the topics covered by Part B and Part C are found on page 24 of this
Prospectus. Copies of Part B and Part C are available upon request and without
charge. To obtain such additional information, write or call the Fund's office
at the address or number shown above. No information in this Prospectus has
been incorporated by reference from Part B or Part C.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
(End of Cover Page)
Synopsis
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The following information is a summary of important information for a
prospective investor or a present shareholder in Bridges Investment Fund, Inc.:
a. The title of the shares of the Fund which are offered for sale in this
Prospectus is capital stock. The Fund does not offer any other securities
for sale.
b. The name of the investment adviser to the Fund is Bridges Investment
Counsel, Inc. The investment adviser's address is 256 Durham Plaza, 8401
West Dodge Road, Omaha, Nebraska 68114. The phone number of the investment
adviser is 402-397-4700.
c. There is no sales load or commission paid as a percentage of the net amount
invested.
d. The minimum initial investment in shares of capital stock of the Fund is
$800.
e. The primary investment objective of the Fund is long-term capital
appreciation. The development of some current income to be paid as
dividends or reinvested in the Fund is a secondary objective of portfolio
investments. There can be no assurance these objectives can be achieved.
See pages 3-5 in the Statement of Additional Information--Part B for a full
Bridges Investment Fund, Inc. 3 April 29, 1996
Prospectus -- Part A
explanation of investment objectives, policies, and policy restrictions.
f. The Fund has operated as an open-end diversified investment company since
July 1, 1963, and the Fund intends to continue on this same basis.
g. The investment adviser, Bridges Investment Counsel, Inc., provides security
research and financial analysis information, decision-making assistance,
investment management, consulting judgment and opinions, and administrative
services to a wide range of securities portfolios representing personal
individuals, trusts, charitable foundations, and financial institutions.
The Firm manages one no-load, open-end investment management company,
Bridges Investment Fund, Inc. Bridges Investment Counsel, Inc. receives an
annual fee of 1/2 of 1% of the average net asset value of the Fund,
determined on the basis of twelve month-end valuations to determine the
average net asset value.
h. The redemption price of the Fund is the next determined Net Asset Value Per
Share. The Fund repurchases the stockholder's shares. There is no
secondary market for the shares of Capital Stock of Bridges Investment
Fund, Inc.
i. The risk or speculative factors peculiar to Bridges Investment Fund, Inc.
may be that the Fund is a relatively small investment company with net
assets of $24.0 million dollars at year-end 1995, and it is sponsored by
Bridges Investment Counsel, Inc., a medium sized investment counsel firm
with three professional persons and more than fifteen staff individuals.
With respect to the moderate size of the Bridges Investment Counsel, Inc.
organization, some investors may consider this structure to be an advantage
rather than a detriment to long-term successful investment results.
j. Bridges Investment Fund, Inc. is an open-end investment management company
designed to provide investors in securities with a diversified portfolio
consisting of common stocks, securities convertible into common stocks, and
fixed income securities. The non-convertible U.S. Treasury and corporate
fixed income securities may not account for more than 40% of the market
value of the Fund's portfolio -- see page 5.
k. The Fund was created primarily for the purpose of extending the services of
the investment management firm of Bridges Investment Counsel, Inc. to
investors whose funds are insufficient in size to permit economical
administration as separate accounts. By acquiring shares of the Fund,
investors obtain securities diversification and continuous investment
supervision. An investment in the Fund does not remove the market risk
inherently involved in making securities investments.
l. The Fund may write covered call options as described on pages 4 and 5 of
the Statement of Additional Information--Part B. The risk in writing a
covered call option is that the price of the underlying common stock will
Bridges Investment Fund, Inc. 4 April 29, 1996
Prospectus -- Part A
rise above its strike or selling price of the option contract.
PROSPECTUS FEE TABLE
Shareholder Transaction Expenses
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Redemption Fee (as a percentage of the amount redeemed): None
Reinvestment of Cash Distributions Transaction Fee; $1.05 per
transaction, four transactions per year for dividend payments,
and one transaction per year for capital gains distributions,
if any.
Annual Fund Operating Expenses
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(as a percentage of average net assets)
Management Fees 0.50%
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Other Expenses 0.39%
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Audit and Custodian Services 0.18%
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Bookkeeping, Dividend and Transfer Agent Services,
Computer Programming, Printing and Supplies 0.16%
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Insurance, Licenses, Taxes and Other 0.05%
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Total Fund Operating Expenses 0.89%
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Example 1 Year 3 Years 5 Years 10 Years
- ------- ------ ------- ------- --------
You would pay the following
expenses on a $1,000 investment
assuming (1) 5% annual return and
(2) redemption at the end of each
time period: $13 $41 $71 $116
--- --- --- ----
You would pay the following
expenses on the same investment,
assuming no redemption: $13 $41 $71 $116
--- --- --- ----
The table above is designed to assist an investor in understanding the
various costs and expenses that a hypothetical investment of $1,000 in Bridges
Investment Fund, Inc. will bear directly or indirectly for the holding periods
shown and for the assumptions set forth therein. The reinvestment of cash
distributions transaction fee of $1.05 is described on page 13 of this
Bridges Investment Fund, Inc. 5 April 29, 1996
Prospectus -- Part A
Prospectus for four quarterly dividend payments. The total fund operating
expenses are tabulated on page 30 of the Statement of Additional Information,
and they are summarized on page 11 of this Prospectus.
The expenses in the hypothetical example are calculated for the most recent
fiscal year for the Fund, except where an expense has changed for the current
fiscal year in which case the present cost is reflected in the estimated costs.
The expenses show both the amounts paid in the Fund's financial statements and
the costs paid by the shareholder.
This hypothetical example assumes that all dividends and distributions are
reinvested. An investor who does not reinvest these distributions would save $4
per year in transaction fees under the calculations shown in the table above.
The estimates shown in the hypothetical example above should not be considered
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as a representation of past or future expenses. Actual expenses may be greater
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or lesser than the amounts shown.
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Condensed Financial Information
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The following table of per share financial highlights has been derived
from records maintained by the Fund. The per share income and capital changes
for each of the most recent five years ended December 31, 1995, have been
audited by Arthur Andersen LLP. Their report appears in the Statement of
Additional Information, and the associated financial statements and notes
thereto should be read in conjunction with this table.
[This space is left blank intentionally.]
Bridges Investment Fund, Inc. 6 April 29, 1996
Prospectus -- Part A
FINANCIAL HIGHLIGHTS*
For the Years Ended December 31
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
--- --- --- --- --- --- --- --- --- ---
Net Asset Value, $17.10 $17.80 $17.51 $17.30 $15.15 $15.97 $14.07 $15.00 $16.46 $15.58
Beginning of Period ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income from Investment
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Operations
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Net Investment Income $.58 $.59 $.61 $.63 $.66 $.67 $.67 $.69 $.63 $.69
Net Gains or (Losses)
on Securities (both)
realized and
unrealized) $4.63 $(.52) $.46 $.37 $2.44 $(.39) $2.44 $.34 $(.39) $1.74
----- ------ ---- ---- ----- ----- ----- ---- ------ -----
Total From Invest.
Operations $5.21 $.07 $1.07 $1.00 $3.10 $.28 $3.11 $1.03 $.24 $2.43
Less Distributions
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Dividends from net
investment income $(.58) $(.59) $(.61) $(.63) $(.66) $(.67) $(.67) $(.85) $(.66) $(.69)
Distributions from
capital gains
$(.19) $(.18) $(.17) $(.16) $(.29) $(.43) $(.54) $(1.11) $(1.04) $(.86)
------ ------ ------ ------ ------ ------ ------ ------- ------- ------
Total Distributions $(.77) $(.77) $(.78) $(.79) $(.95) $(1.10) $(1.21) $(1.96) $(1.70) $(1.55)
------ ------ ------ ------ ------ ------- ------- ------- ------- -------
Net Asset Value, $21.54 $17.10 $17.80 $17.51 $17.30 $15.15 $15.97 $14.07 $15.00 $16.46
End of Period ====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return 30.46% 0.39% 6.18% 5.94% 20.78% 1.89% 22.22% 6.96% 0.79% 16.90%
------------ ------ ----- ----- ----- ------ ----- ------ ----- ----- ------
Ratios/Supplemental
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Data
- -----
Net Assets, End of
Period (in thousands) $24,052 $18,096 $17,991 $17,007 $14,375 $11,283 $10,895 $8,593 $7,876 $6,702
------- ------- ------- ------- ------- ------- ------- ------ ------ ------
Ratio of Expenses to
Average Net Assets**
0.89% 0.90% 0.90% 0.94% 0.98% 0.99% 0.99% 1.01% 0.96% 0.98%
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Ratio of Net Inc.
to Avg. Net Assets
3.80% 4.25% 4.32% 4.57% 4.91% 5.28% 4.29% 4.49% 3.56% 4.09%
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Portfolio Turnover
Rate 7% 10% 11% 7% 28% 26% 27% 31% 31% 27%
Avg. Comm. Rate Pd.*** 0.1222 0.1470 0.1253 0.1781 0.1195 0.1297 0.2095 0.1929 0.3101 .2907
*Per share income and capital change data is computed using the weighed
average number of shares outstanding method.
**Average net asset data is computed using monthly net asset value figures.
***Cents Per Share
General Description of Registrant
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History -- The Fund was organized as an open-end investment company under
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the laws of Nebraska on March 20, 1963. Investment operations commenced on July
1, 1963, and the shares of Capital Stock were sold to the general public on
December 7, 1963. The Fund has conducted its business continuously since the
initiation of these activities.
Investment Objectives and Policies -- The primary investment objective of
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the Fund is long-term capital appreciation. In pursuit of that objective, the
Fund will invest primarily in common stocks and securities convertible into
common stocks, and the market value of these securities will normally represent
Bridges Investment Fund, Inc. 7 April 29, 1996
Prospectus -- Part A
60% or more of the total value of the Fund's assets. The selection of common
stocks and convertible securities will emphasize companies which, in the opinion
of the Fund's management, offer opportunities for increased earnings and
dividends. However, the Fund may also invest in common stocks which may be
cyclically depressed or undervalued, and, therefore, may offer potential for
capital appreciation.
The development of a modest amount of current income is a secondary
investment objective of the Fund. In moving towards that goal, the Fund may
acquire investment grade corporate bonds, debentures, U.S. Treasury Bonds and
Notes, and preferred stocks, provided not more than 40% of the value of its
assets are maintained in these types of fixed income securities. Investment
grade corporate bonds and preferred stocks must carry, at the time of purchase,
a Moody's Investor Service rating of Baa or higher or a Standard & Poor's
Corporation rating of BBB or higher. Some securities rated Baa or BBB may have
speculative characteristics. The investment grade bonds, debentures, and
preferred stocks may also be employed to provide a source of funds for future
purchases of equity type securities.
The Fund may purchase investments in securities of foreign issuers,
provided that the market value of such securities will not exceed 10% of total
assets, and a further limitation will require that these securities be traded as
American Depository Receipts.
For speculative capital gain purposes, the Fund may purchase bonds,
debentures, and preferred stocks that carry extraordinarily high yields and
balance sheet risk or which have one or more interest or dividend payments in
arrears, providing that the purchase of this type of securities will be limited
to 5% of the value of the assets of the Fund. Some of the securities of this
generic type have been described in the current market environment as junk
bonds. Historically, the Fund's security selection policy permitted the
selection of issues that had not been part of a leveraged buy-out or other
recapitalization transaction but that were or could be attractive for reasons
related to a recovery of previous fundamental value that existed at the time of
their original issuance. Refer to Page 5 -- Part B of the Statement of
Additional Information for an expanded discussion of this policy.
Under unusual economic or financial market circumstances, the Fund may
maintain a substantial part or all of its assets in cash or U.S. Government
securities for temporary defensive purposes. The Fund may maintain positions in
U.S. Government securities for as long as such unusual market conditions exist,
and the amounts of these Treasury securities will be excluded when the daily
Bridges Investment Fund, Inc. 8 April 29, 1996
Prospectus -- Part A
calculation is made to allocate securities values under the 40% of the value of
total assets policy guideline for the investment grade bond, debentures, and
preferred stocks.
The foregoing policies as to investments may be altered by the Fund's Board
of Directors; however, they will not be changed without prior written notice to
shareholders in a supplement to the Prospectus, or at such time as the next
annual revisions to the Prospectus become effective.
In addition to the investment objectives and policies disclosed above, the
Fund adheres to certain other investment policy and selection restrictions which
are set forth in the Statement of Additional Information.
An investor should be aware that the ownership of common stocks through an
investment in the Fund entails price volatility risks attendant to the general
market action for all types of equities. Investors should also recognize that
an inverse relationship exists between bond prices and interest rates wherein
higher interest rates could cause lower bond prices, and lower interest rates
could create higher bond prices with the impact of these interest rate condition
changes being the greatest upon the very long maturity issues.
With respect to the utilization of U.S. Treasury securities for temporary
defensive purposes, investors should anticipate that these defensive actions may
result in less than 60% of the assets of the Fund to be held in common stocks
and other equity type securities and that such temporary defensive actions may
be taken prior to the development of the expected adverse market circumstances.
Further, subsequent events in the market place may or may not vindicate the
judgment of the investment manager to establish the temporary defensive
positions in U.S. Government securities, and the lack of the onset of the
adverse market conditions may cause temporary defensive positions to be held for
unanticipated, long intervals of time.
Management of the Fund
- ----------------------
Governance -- The Board of Directors of the Fund is responsible for the
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general governance of the affairs of the Fund. In particular, the Board
establishes contractual relationships and maintains surveillance of the
investment manager, the custodian bank and transfer agent, the insurance
coverage, the certified public accountants, and the legal representation for the
Fund. In addition, the Board of Directors reviews the position of the Fund with
respect to Federal and State regulations, and the Board of Directors is
concerned about compliance with tax rules to maintain the Fund's position as a
regulated open-end investment management company. Lastly, the Board is
Bridges Investment Fund, Inc. 9 April 29, 1996
Prospectus -- Part A
responsible for attracting interested and competent individuals to serve as
representatives for the shareholders. Board members carry broad perspectives
beyond the fields of finance and investments, and these individuals provide
insight and guidance for the general business policy of the Fund through the
structure of the Audit Committee, the Executive Committee, and the regular
quarterly Board of Directors meetings. Additional information regarding the
Board of Directors can be found in the Statement of Additional Information.
Investment Adviser -- Bridges Investment Counsel, Inc., 8401 West Dodge
------------------
Road, Omaha, Nebraska 68114, acts as manager and investment adviser under a
contract with the Fund. In addition to furnishing continuing investment
supervision for the Fund, the investment adviser provides office space,
facilities, equipment, and personnel for managing the assets of the Fund.
Further, the investment adviser pays the costs of maintaining the registration
of shares of the Fund under Federal securities laws and under the laws of the
State of Nebraska and in any other state if such registrations should be made at
a future date.
Bridges Investment Counsel, Inc. is registered as an investment adviser
with the Securities and Exchange Commission under the Investment Advisers Act of
1940. The Firm and its predecessors have acted continuously as professional
investment advisers and managers since early 1945. Portfolio investment
securities advice is rendered to individuals, personal trusts, pension and
profit sharing accounts, IRA rollovers, charitable organizations and
foundations, corporations and other account classifications. Assets under
management as of the last quarter of 1995 were in excess of $600 million.
Bridges Investment Counsel, Inc. also provides hourly consulting advice about a
number of alternative investment matters on a limited basis. Hourly consulting
services are also available for non-portfolio securities matters such as estate
and financial planning and general business administration projects. Bridges
Investment Counsel, Inc. has a management agreement to operate Provident Trust
Company, an enterprise that was responsible for $157,763,000 in trust customer
assets at December 31, 1995.
Investment selections made by Bridges Investment Counsel, Inc. for the Fund
are predicated upon research into general economic trends, studies of financial
markets, and industry and company analyses. The Firm obtains its security
analysis information from several financial research organizations which
restrict the release of their reports primarily to institutional users such as
banks, insurance companies, investment counselors, and trust companies.
Under a contract with the Fund, Bridges Investment Counsel, Inc. furnishes
continuous investment supervision to the Fund, and, for its services, is
entitled to receive a quarterly fee of 1/8 of 1% of the average Net Asset Value
Bridges Investment Fund, Inc. 10 April 29, 1996
Prospectus -- Part A
of the Fund, as determined by appraisals at the close of each month in the
quarterly period. This total annual fee of 1/2 of 1% of the Fund's Net Assets
as determined above is the only compensation received by Bridges Investment
Counsel, Inc. from the Fund. The Fund paid $107,149 to Bridges Investment
Counsel, Inc. for its services as investment adviser during the Fiscal Year
ending December 31, 1995.
The Annual Report of the Fund for 1995 includes twelve pages of text,
tabular and graphic information that reports the names, titles, years of
service, and primary responsibilities of the persons employed by Bridges
Investment Counsel, Inc. who are primarily responsible for the day-to-day
management of the Fund's portfolio.
In addition, the disclosure in the Annual Report of the Fund for 1995
discusses factors, including relevant market conditions and the investment
strategies and techniques pursued by Bridges Investment Counsel, Inc., that
materially affected the performance of the Registrant during the most recently
completed fiscal year.
A line graph is provided that compares the initial account value and
subsequent account values at the end of each of the most recently completed ten
fiscal years of the Registrant, assuming a $10,000 investment in the Fund at the
beginning of the first fiscal year, to the same investment over the same periods
in an appropriate broad-based securities market index.
The Fund's average annual total returns for the one, five, and ten-year
periods ended on the last day of the most recent fiscal year accompany the line
graph. The past performance shown thereon is not predictive of future
performance.
All of these items of information are included in a section of the Annual
Report designated as a Shareholder Communication with the title Management's
Discussion and Analysis. This discussion is found at the back of the Annual
Report on the pages designated as MD&A 1-12. Each person who obtains an
effective Prospectus of the Fund must receive from representatives of the Fund
an Annual Report that includes the Management Discussion and Analysis for the
most recently completed fiscal year. Please refer to pages 23-24 for a
description of the responsibilities and experience of the Fund's portfolio
managers.
Custodian -- First Bank N.A. Omaha, Nebraska, 1700 Farnam Street, Omaha,
---------
Nebraska, acts as Custodian for the Fund. The Bank holds all securities and
cash of the Fund, receives and pays for securities purchased upon delivery of
the assets, delivers against payment from brokers for securities sold, receives
and collects income from investments. The Bank does not exercise any
Bridges Investment Fund, Inc. 11 April 29, 1996
Porspectus -- Part A
supervisory function in management matters such as the purchase and sale of
portfolio securities. The Bank acts as Custodian for the master plans adopted
by Fund shareholders. Reports required by the Internal Revenue Service and
other regulatory entities, particularly those information returns related to
deferred benefit plans, are filed by the Custodian on behalf of the
shareholders.
Dividend Disbursing and Transfer Agent -- Bridges Investor Services, Inc.,
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8401 West Dodge Road, Omaha, Nebraska, acts as Dividend Disbursing and Transfer
Agent for the Fund. Services handles the transactions for all capital stock
issued by the Fund and for all redemptions of Fund shares. Services processes
all reinvestment and scheduled investment transactions as described later in
this Prospectus. Services is responsible for issuing Form 1099 information to
shareholders each year.
Expenses -- The Fund pays the charges of the Custodian, Dividend Disbursing
--------
and Transfer Agent, the fees of the Auditors and Legal Counsel, and the fees of
the Investment Adviser as described earlier. The Fund also incurs other
expenses such as bookkeeping, publication of notices and reports to
shareholders, printing and mailing of stock certificates, and miscellaneous
taxes. However, total annual expenses of the Fund, exclusive of taxes but
including fees paid to the Investment Adviser, are limited to 1 1/2% of average
net assets. Bridges Investment Counsel, Inc. agrees to reimburse the Fund for
expenditures in excess of such amount. During 1995, there were no reimbursed
expenses paid under this contract arrangement and expense limitation. Complete
information on expenses of the Fund in 1995 can be found in the Statement of
Operations for the year ended December 31, 1995, shown on page 30 of the
Statement of Additional Information. The ratio of operating expenses to average
net assets was 0.89% for the Fund in 1995.
The expenses paid by the Fund, expressed in terms of a percentage of
average net assets, calculated monthly, for 1995, are identified in the table
below:
EXPENSES PAID BY THE FUND
Percent of Avg.
Net Assets
----------
Type of Expenses Name of Payee(s)
---------------- ----------------
1. Investment Advisory Fees Bridges Inv. Counsel, Inc. 0.50%
2. Distribution Expenses None 0.00%
3. Shareholder Serv. Exp. Bridges Inv. Services, Inc. 0.04%
4. Other Expenses First Bank N.A. Omaha, Nebraska, 0.35%
-----
Arthur Andersen LLP, ICI
Mutual Ins. Co. and others
5. Total Expenses 0.89%
=====
Bridges Investment Fund, Inc. 12 April 29, 1996
Prospectus -- Part A
Brokerage --The Fund does not follow a practice of paying brokerage
---------
commissions to any broker (a) which is an affiliated person of the Fund, or (b)
which is an affiliated person of such person, or (c) an affiliated entity which
is an affiliated person of the Fund, its investment adviser, or other person.
The Fund may place brokerage commissions for goodwill, from time to time, that
could recognize appreciation for referring investors to the Fund and other
factors of an intangible but positive nature. During 1995, there were no
brokerage commissions attributed to the goodwill factor.
Capital Stock and Other Securities
- ----------------------------------
Structure -- The capital structure of the Fund consisted of 3,000,000
---------
authorized shares with a par value of one dollar per share as of December 31,
1995, with 1,754,237 shares issued to that date. The shares have equal rights
as to voting, redemption, dividends, and liquidation, with cumulative voting for
the election of directors. The shares are redeemable on written demand of the
holder and are transferable. The shares have no preemptive or conversion rights
and are not subject to assessment. Fractional shares have the same rights
proportionately as full shares, except they do not carry the right to vote.
Shares redeemed by the Fund cannot be reissued, and the Fund's authorized
capital stock shall be deemed to be reduced by the amount of the shares
redeemed. At December 31, 1995, 637,617 shares of the Fund had been redeemed
since inception of the Fund in 1963.
The net shares of capital stock outstanding were 1,116,620 on December 31,
1995.
Control -- As of January 31, 1996, no individual or group of individuals
-------
through beneficial ownership of shares is in control of the Fund. For the
purpose of this disclosure, control is defined as the ownership of 25% of the
voting securities by one or more related parties.
Rights -- The rights of holders of capital stock may not be modified except
------
by a vote of a majority of the owners of the outstanding shares of such stock.
Other Classes of Securities -- The Fund does not have any other classes of
---------------------------
securities than capital stock.
Bridges Investment Fund, Inc. 13 April 29, 1996
Prospectus -- Part A
Inquiries -- Shareholder inquiries for information of assistance in
---------
handling administrative matters should be directed to Mrs. Nancy K. Dodge,
Treasurer, Bridges Investment Fund, Inc., 256 Durham Plaza, 8401 West Dodge
Road, Omaha, Nebraska 68114. Mrs. Dodge may also be reached by telephone at
402-397-4700.
Dividend Policy -- The Fund will distribute to shareholders substantially
---------------
all of the net income and net capital gains, if any, realized from the sale of
securities. Dividends will be paid on or about the 25th day of January, April,
July, and October. Shareholders will be advised as to the source or sources of
each distribution. A year-end payment of capital gains, if any amounts are
earned between November 1 and October 31 in any given year, will be paid on or
before December 31st to meet a special requirement of the Tax Reform Act of
1986. The Fund must declare a dividend amount payable before January 31 of the
next year on December 31 in order to remit at least 98% of the net investment
income for the calendar year to comply with the provisions of the 1986 Act. The
investment return will depend upon and vary with changes in interest rates,
dividend yields, investment selections of the Fund, and many other unpredictable
factors.
Federal Taxation -- The Fund has complied with the special provision of the
----------------
Internal Revenue Code which pertain to investment companies so it will be
relieved of payment of Federal income taxes on amounts distributed to
shareholders. The Fund intends to continue to comply with such provisions of
the Internal Revenue Code. Shareholders are subject to Federal income tax on
distribution of investment income and on short-term capital gains which are
treated as ordinary income. However, payments designated as capital gain
distributions (defined as the excess of net long-term capital gains over net
short-term capital losses) are taxable to the shareholders as long-term capital
gains irrespective of the length of time a shareholder has held his stock in the
Fund.
The Fund will be required to withhold 31% of dividend distributions for
payment of Federal income taxes for a shareholder, unless the Fund receives a
Form W-9 election to request that the 31% amount not be withheld. The Form W-9,
also known as back-up withholding, will be supplied in a separate document to
new shareholders by Bridges Investor Services, Inc. at the time of initial
subscription to shares of the Fund. The shareholder will be required to provide
certain pertinent information on the Form W-9, including the appropriate Social
Security or Tax Identification number.
Bridges Investment Fund, Inc. 14 April 29, 1996
Prospectus -- Part A
Shareholders who are tax-exempt entities with respect to Federal and State
income taxes will not be subject to tax on the income and capital gains
distributions from the Fund.
The Fund, through an annual tax information letter and quarterly
shareholder reports, will inform the investors of the amount and generic nature
of such income and capital gains. Bridges Investor Services, Inc., through the
annual Form 1099 or its substitute equivalent, will provide a report for each
individual account within an appropriate time frame after the close of the
Fund's fiscal year.
Securities Offered -- The Fund offers only shares of capital stock. There
------------------
are no other securities to be described in this Prospectus.
Purchase of Securities Being Offered
- ------------------------------------
Net Asset Value -- Shares of the Fund are sold directly to investors by the
---------------
Fund at the next determined Net Asset Value.
The Net Asset Value of a share of the Fund at any specific time is obtained
by dividing the value of the net assets of the Fund by the total number of
shares outstanding at such time. The calculation of Net Asset Value includes
the daily accrual of income and expenses. Expenses are estimated at a daily
accrual rate, and this daily accrual rate is adjusted to costs on a monthly or
quarterly basis if the daily accrual rate is above or below actual costs when
such costs become known.
Securities traded on stock exchanges will ordinarily be valued on the basis
of the last sales price on the date of valuation, or lacking any sales, at the
closing bid on such day on the principal trading exchange or market. Other
securities will be valued at the closing bid price. Short-term securities such
as Treasury Bills with under a 60-day maturity are valued at the purchase price,
and the income from the discount is reflected as accrued income on a daily
basis. However, if the Board of Directors determines that such methods of
valuation do not properly reflect the true market value at such time, it may
substitute such other method as, in its judgment, more nearly reflects such true
market value, except that in no case shall its alternate method result in a
price below the closing bid price or in excess of the closing asked price.
Securities and other assets for which no market quotations are readily available
will be valued at their fair value as determined in good faith by the Board of
Directors.
Subscription Order Form -- The Stock Subscription and Plan Order Form will
-----------------------
be sent with this Prospectus, or it may be obtained from the offices of the Fund
at 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114. The completed
Bridges Investment Fund, Inc. 15 April 29, 1996
Prospectus -- Part A
order form and check payable to the Fund should be sent to the above address.
If the order form is received prior to the close of the New York Stock
Exchange on any day from Monday through Friday on which the New York Stock
Exchange is open for trading, the Net Asset Value is determined as of the close
of trading on that day. If the order form is received after the close of the
New York Stock Exchange, the Net Asset Value is determined as of the close of
trading upon the New York Stock Exchange on the next succeeding day on which
such Exchange is open for trading.
All order forms are subject to acceptance by authorized officers of the
Fund in Omaha and are not binding until so accepted. It is the policy of the
Fund not to accept orders for stock under circumstances or in amounts considered
to be disadvantageous to existing shareholders.
Shares in the Fund may be purchased under several plans designed to meet
the needs of various types of investors.
Unscheduled Investments -- An investor may purchase shares of the Fund at
-----------------------
such times and in such amounts as he desires. However, the Board of Directors
of the Fund has established a minimum of $800 for each unscheduled investment in
shares of the Fund for initial and subsequent commitments. An investor who
wishes to buy stock under this investment alternative should fill out Part I of
the Stock Subscription and Plan Order Form and mail it with a check to the Fund.
The dividends and capital gains distributions, if any, on capital stock
purchased under this Plan will be distributed to the investor. However, if the
investor desires to reinvest his dividends or capital gains distributions, or
both, he should consider the Fund's Reinvestment of Cash Distributions Plan.
Shares purchased under this Plan are entered on the stock transfer records
maintained by Bridges Investor Services, Inc. Certificates for full shares are
delivered to the investor upon his direction or request. Fractional shares are
held on the books of the Transfer Agent. These fractional shares have full
dividend and redemption rights, but the fractional shares do not have voting
rights.
Reinvestment of Cash Distributions Plan -- For the convenience of
---------------------------------------
unscheduled investors who desire to have their dividends or capital gains
distributions, or both, reinvested in additional shares, arrangements have been
made with Bridges Investor Services, Inc. to act as their agent to make such
reinvestments. The investor should fill in Part II of the Stock Subscription
and Plan Order Form and send it to the Fund.
Bridges Investment Fund, Inc. 16 April 29, 1996
Prospectus -- Part A
Certificates for shares purchased under this Plan are not issued, but are
entered on the stock transfer records kept by Bridges Investor Services, Inc.
These shares carry full rights as to voting, redemption, and dividends, except
that fractional shares carry no voting rights. Certificates for full shares
will be delivered to the investor if they are requested. An investor starting a
Reinvestment of Cash Distributions Plan may turn in certificates for shares
already owned, and, thereafter, Bridges Investor Services, Inc. will hold such
shares in the Plan Account.
The investor may terminate this Plan at any time without penalty, and
Bridges Investor Services, Inc. will forward to him certificates for his shares
and a check for the redemption price of any fractional share. Dividends and
capital gains distributions, if any, will be paid thereafter to the investor in
cash as an unscheduled investor.
For acting as the investor's agent in reinvesting cash distributions,
Bridges Investor Services, Inc. deducts a service charge of $1.05 for each
reinvestment, such charge being deducted before the reinvestment is made. A
reinvestment of a combined dividend and capital gains distribution will be
considered as one reinvestment.
Reinvestment of cash distributions will be made at the Net Asset Value per
share which is in effect on the dividend payment date.
Scheduled Investments Plan -- Investors wishing to purchase shares of the
--------------------------
Fund at regular intervals may do so through the Fund's Scheduled Investments
Plan. Bridges Investor Services, Inc. will accept periodic payments from the
investor and will buy shares of the Fund on his behalf. The usefulness of this
Scheduled Investments Plan is to assist the investor in organizing regular
payments of uniform amounts to the Fund to build his position in the Fund over a
long period of time.
To start such a Plan, the investor fills out Part III of the Stock
Subscription and Plan Order Form and mails it with his initial qualification
investment to the Fund. The investor's initial qualification investment must be
at least $800. However, if the investor already owns shares of the Fund with a
current minimum Net Asset Value of at least $800, he may request a
reclassification of these shares to a Scheduled Investment Plan with the Order
Form as his initial qualification investment for the Plan.
The investor must specify on the Order Form whether he intends to make
monthly, bi-monthly, or quarterly payments and the amount of his payments. He
may omit a payment or send more or less than the specified amount so long as
each of his payments is at least $200. All of these payments should be sent
Bridges Investment Fund, Inc. 17 April 29, 1996
Prospectus -- Part A
directly to the offices of the Fund. An investor under this Plan must invest a
total of at least $800 within a period of twelve months after his qualification
investment and in each twelve-month period thereafter.
Purchases under the Scheduled Investments Plan are made on the 5th, 15th,
or 25th day of the month at the Net Asset Value per share in effect on those
dates. Each payment is applied to purchase the greatest number of full and
fractional shares.
If a Scheduled Investments Plan payment is received by Bridges Investor
Services, Inc. on a date other than the 5th, 15th, or 25th day of the month, the
payment will be subscribed on the date it is received to purchase shares of the
Fund at the price next determined.
Shares purchased under this Plan are entered on the stock transfer records
maintained by Bridges Investor Services, Inc. Certificates for full shares are
delivered to the investor only if requested. Shares held under the Plan have
full dividend, voting, and redemption rights, except that fractional shares do
not have voting rights.
All dividends and capital gains distributions held in a Scheduled
Investments Plan account are automatically reinvested in additional shares of
the Fund at the Net Asset Value in effect on the dividend payment dates.
Bridges Investor Services, Inc., as agent for the investor, will deduct a
service charge of $1.05 from each cash distribution after which the balance is
then reinvested in shares of the Fund.
In addition, Bridges Investor Services, Inc. will deduct a service charge
of $1.05 from each payment made to it under this Plan other than the $800
qualification payment. Following each scheduled payment, Bridges Investor
Services, Inc. will mail an Advice Slip acknowledging the purchase of shares.
The investor may terminate this Plan at any time without penalty, and
Bridges Investor Services, Inc. will forward to him certificates for his shares
and a check for the redemption price of any fractional share. Dividends and
capital gains distributions, if any, will be paid thereafter to the investor in
cash as an unscheduled investment.
Accumulation of shares under the Fund's Scheduled Investments Plan does not
assure a profit, nor does it protect against any loss due to declines in the
market value of the Fund's investments.
Standard Retirement Plan -- Bridges Investment Fund, Inc. offers a master
------------------------
Standard Retirement Plan (as Amended and Restated as of January 1, 1989) for
Bridges Investment Fund, Inc. 18 April 29, 1996
Prospectus -- Part A
corporations, self-employed individuals, and partnerships and their employees.
Investors may choose a Money Purchase Pension Plan, a Profit Sharing Plan which
includes a Salary Reduction Arrangement under Section 401(k) of the Code within
the Standard Retirement Plan. The master plan includes a Standard Custodial
Agreement (as Amended and Restated as of January 1, 1989) under which First Bank
N.A. Omaha, Nebraska will act as Custodian. Bridges Investor Services, Inc.
will invest all contributions to the Plan in the shares of the Fund at Net Asset
Value, invest all dividends and cash distributions in shares of the Fund at Net
Asset Value (less a $1.05 reinvestment fee per payment), and receive service
fees chargeable to the participant accounts in the Plan or the employer
sponsoring the Plan as follows:
. Acceptance fee: $5.00 for each person participating in the Plan;
. Annual maintenance fee: $8.00 per year for each person who is a
participant during any part of the Plan Year, including participants
receiving periodic distributions under the Plan and including any Owner-
Employee whose account is being held by the Custodian after termination
of the Plan and before distribution;
. Termination fee: $6.00 per participant on termination of the Plan or on
the initial withdrawal from such participant's account;
. Periodic cash distribution: $1.75 for each payment;
. Reinvestment of cash distributions (dividend and capital gains payments
from the shares of the Fund): $1.05 for each reinvestment.
The foregoing charges may be deducted by the Custodian from employer
contributions, dividends or capital gains distributions, periodic cash
distributions, and termination remittances before investments or separation
payments are made. Extraordinary services resulting from unusual administrative
responsibilities not contemplated by the above schedule will be subject to such
additional charges as will reasonably compensate the Custodian for the services
involved.
The acceptance fee and first annual maintenance fee for each Plan
participant may be deducted by the Custodian from the initial contribution
payment when the Plan is established. Subsequent fees are deducted from
contribution payments in any given year to the extent contributions are made and
otherwise are paid by liquidation of assets from a participant's account. To
the extent assets of participant accounts are insufficient to pay fees of the
Bridges Investment Fund, Inc. 19 April 29, 1996
Prospectus -- Part A
Custodian or other expenses of the Plan, the Standard Custodial Agreement
provides that such expenses will be charged to the employer.
The fees for the foregoing are subject to adjustment from time to time by
written agreement between the Custodian and the employer. In addition, the
Custodian is entitled to reimbursement for certain expenses and taxes, including
securities transfer taxes. The Custodian may resign or be removed, and a
successor Custodian may be appointed.
If an investor desires to appoint a different bank as Custodian, he may
make his own fee arrangements with the bank of his choice. For further details,
see the form of Standard Retirement Plan No. 001, Profit Sharing, and No. 002,
Money Purchase Pension, and their related Standard Custodial Agreements, copies
of which may be obtained from the Fund's office at the address shown on the
cover of this Prospectus. The amended documents as of January 1, 1989, were
filed with the Internal Revenue Service for approval as prototype master plans
in December, 1989. The IRS has assigned qualified serial numbers to these
Plans.
In undertaking such a Retirement Plan involving investments over a period
of years, it is important for the individual to consider his needs and whether
or not the investment objectives of the Fund, described in this Prospectus, are
likely to fulfill them. An investor who contemplates establishment of such a
Plan should consult with his attorney and/or his public accountant.
The Prototype Standardized Profit Sharing Plan with CODA known in our Fund
as Standard Retirement Plan No. 001 (As Amended and Restated as of January 1,
1989) Profit Sharing with a Salary Reduction Arrangement under Section 401(k) of
the Internal Revenue Code received approval from the Internal Revenue Service on
July 31, 1990. This Plan No. 001 is identified by Letter Serial No: D249067a.
The Prototype Standardized Money Purchase Pension Plan described by our Fund as
the Standard Retirement Plan No. 002 (As Amended and Restated as of January 1,
1989) Money Purchase Pension received approval from the Internal Revenue Service
on July 31, 1990. This Plan No. 002 is identified by Letter Serial No:
D249068a. Both Plans have incorporated model amendments published by the
Internal Revenue Service which adopt all changes required by the tax laws since
the Plans were restated.
Individual Retirement Custodian Account Prototype
- -------------------------------------------------
An investor, referred to as a Depositor in this section of the Prospectus,
may wish to purchase shares of Bridges Investment Fund, Inc. in conjunction with
the retirement benefits provided by the Employee Retirement Income Security act
Bridges Investment Fund, Inc. 20 April 29, 1996
Prospectus -- Part A
of 1974. There is available through Bridges Investment Fund, Inc. a Prototype
Individual Retirement Custodial Account with Application Form, Contribution
Form, and Disclosure Statement.
The Custodian Agreement provides that First Bank N.A. Omaha, Nebraska will
furnish custodial services as required by such Act for fees chargeable to the
Depositor as follows:
. Acceptance Fee $5.00 payable on establishment of the Account.
. Annual Maintenance Fee $8.00 per year until withdrawals from the Account
are begun by the Depositor or his beneficiary.
. Termination Fee $6.00, payable on the initial withdrawal from the
Account.
. Periodic Cash Distribution, $1.75 for each payment.
. Investment of cash distributions as defined in this Prospectus, $1.05
for each reinvestment.
Extraordinary services resulting from unusual administrative responsibilities
not contemplated by the above schedule will be subject to such additional
charges as will reasonably compensate the Custodian for the services involved.
The Depositor or the Custodian shall have the right to terminate the Account
upon 60 days' notice to the other party. In the event of such termination, the
Custodian shall make distribution of the Account to the Depositor or to another
qualified plan or successor Custodian designated by the Depositor.
The Fund's Individual Retirement Custodial Account Prototype permits a
maximum annual contribution of $2,000 or 100% of the Depositor's annual
compensation for personal services, whichever is less. If an investor has a
non-working spouse, an additional annual contribution of $250 is permitted for a
total contribution of $2,250. Under the Prototype, the annual contribution may
be deductible under certain conditions, and earnings, if any, accumulate tax-
free until distribution after age 59 1/2. Normally, distributions from the
Individual Retirement Custodial Account prior to age 59 1/2, unless made as a
result of disability, will result in adverse tax consequences. In addition,
there is a penalty on excess contributions and a penalty on insufficient payouts
after age 70 1/2.
To establish an Individual Retirement Custodial Account, the Depositor is
provided a copy of the Fund's current Prospectus, three copies of the Individual
Bridges Investment Fund, Inc. 21 April 29, 1996
Prospecstus -- Part A
Retirement Account Custodial Agreement, three copies of the Application Form,
three copies of the Contribution Form, and three copies of the Disclosure
Statement. The Depositor executes and forwards to First Bank N.A. Omaha,
Nebraska three copies of the Application Form and three copies of the
Contribution Form. First Bank N.A. Omaha, Nebraska will return one acknowledged
copy of each form to the Depositor and the Fund for retention by each party.
The Depositor will sign and send one copy of the Disclosure Statement to the
Fund at its office. The Depositor should retain the other executed copy for a
permanent record in his files.
The Custodial Agreement sets forth provisions governing the Depositor's
Account, expresses the prohibited actions under the law, sets forth the
provisions of distribution of payments, provides the rules for reports and other
information, outlines the Custodian's responsibilities, and provides for
Amendments to and Termination of the Custodial Account.
The Application Form establishes the Custodial Account, collects pertinent
information to govern the Custodial Account, and recites the applicable fees to
be charged by First Bank N.A. Omaha, Nebraska. By executing the Application
Form, the Depositor acknowledges receipt of the Prospectus. The Contribution
Form governs the method and type of contribution to the Custodial Account. The
Disclosure Statement covers appropriate notices of applicable provisions of the
Internal Revenue Code, the fees for the account, and other important information
concerning the operation of the Individual Retirement Custodial Account. Prior
to executing these documents, the Depositor should read all the documents
constituting the Prototype.
The Individual Retirement Custodial Account sponsored by the Fund was
approved as a Prototype Plan pursuant to an opinion letter received from the
Internal Revenue Service dated June 11, 1993. The Approval Letter carries the
Serial No: D111476c.
First Bank N.A. Omaha, Nebraska meets the applicable legal requirements to
act as the Custodian under the Prototype.
The provisions to redeem shares of the Fund, as described in this
Prospectus, are not changed by the terms of the Prototype.
The Depositor may revoke his Custodian Account within at least seven days
of the date of establishment as provided in Article VI C of the Custodian
Agreement, paragraph 9 of the Application Form, and in paragraph 3 (i) of the
Disclosure Statement. A shareholder may wish to consider a redemption of the
Fund shares as an alternative to revoking his Custodian Account.
Bridges Investment Fund, Inc. 22 April 29, 1996
Prospectus -- Part A
In undertaking such an Individual Retirement Custodian Account as provided
by this Prospectus and related documents, involving investments over a period of
years, it is important for the individual to consider his needs and whether or
not the investment objectives of the Fund, described in this Prospectus, are
likely to fulfill them. The individual who contemplates the establishment of
the Prototype should consult with his attorney or tax adviser regarding
appropriate advice as to the actions to be taken. Particular attention should
be directed to changes in the deductibility of contributions to IRAs for tax
years commencing January 1, 1987, or later for those persons who are covered by
employer sponsored deferred benefit plans and other factors related to annual
reported tax amounts of single and joint income. Reference to IRA Announcement
S6-121 should also be helpful, copies of which may be obtained from the Fund's
office.
Other Disclosures -- The Fund has no principal or other underwriters. The
-----------------
Fund has no distribution expenses. All such costs are paid for by Bridges
Investment Counsel, Inc. If a shareholder makes a miscellaneous payment to
subscribe for shares in the Fund, the payment will be treated as an Unscheduled
Investment, except that amounts less than $800 will have a $1.05 fee deducted
and paid to Bridges Investor Services, Inc.
No Sales Loads -- Bridges Investment Fund, Inc. shares are purchased
--------------
directly from the Fund at the next determined Net Asset Value without the
deduction of any sales load or selling commissions. With the exception of the
service charges outlined above on Plan Accounts, every dollar invested by a
shareholder is attributed to his purchase of shares.
Redemption of Shares
- --------------------
A shareholder may at any time, except as specified below, require the Fund
to redeem his stock by delivering his properly endorsed stock certificates, as
more fully described in the paragraph below, to the Fund at 256 Durham Plaza,
8401 West Dodge Road, Omaha, Nebraska. A shareholder in a Plan Account must
send the Fund a written notification which requests that part or all of his
stock be redeemed.
The redemption price is the next determined Net Asset Value thereof. The
redemption price may be above or below the investor's cost, depending on the
market value of the Fund's portfolio securities at the time of the redemption.
If a certificate or a written notification is received in good form prior
to the close of the New York Stock Exchange on any day from Monday through
Friday on which the New York Stock Exchange is open for trading, the Net Asset
Value is determined as of the close of trading on that day. If a certificate or
Bridges Investment Fund, Inc. 23 April 29, 1996
Prospectus -- Part A
a written notification is received in good form at any other time, the Net Asset
Value is determined as of the close of trading upon the New York Stock Exchange
on the next succeeding day on which such Exchange is open for trading.
All certificates presented for redemption or requests for liquidation of
uncertificated shares held under Plan Accounts must be duly endorsed or
accompanied by a duly executed separate assignment, with signature(s) guaranteed
by either a financial or banking institution whose deposits are insured by the
Federal Deposit Insurance Corporation or by a brokerage firm which is a member
of any exchange as defined in the fidelity insuring bond carried by the Fund
with ICI Mutual Insurance Company. The signature(s) should be in the name(s) of
the stockholder as shown on the stock transfer records which are maintained for
the Fund by Bridges Investor Services, Inc. The signature guarantee must be
obtained in each instance of a redemption for both certificated and
uncertificated shares. The Fund and its Transfer Agent will also recognize
guarantors that participate in the Securities Transfer Agents Medallion Program
(STAMP) that began August 24, 1992.
Payment for shares redeemed will be made within seven days after request in
good order for redemption and tender of shares has been made. Redemption
privileges and payments may, however, be suspended during periods when the New
York Stock Exchange is closed (other than weekends and holiday closings) or
trading thereon is restricted, or for any period during which an emergency
exists as a result of which (a) disposal by the Fund of securities owned by it
is not reasonably practicable, or (b) it is not reasonably practicable for the
Fund to fairly determine the value of its net assets, or for such other periods
as the Securities and Exchange Commission may by order permit for the protection
of the security holders of the Fund. The Securities and Exchange Commission
shall determine when trading on the New York Stock Exchange is restricted and
when an emergency exists.
The Fund has no procedure whereby a shareholder can sell his shares to the
Fund through a broker dealer. The Fund is not permitted to redeem shares
involuntarily in accounts below a certain number or value of shares. The Fund
will honor all requests for redemption properly documented irrespective of the
length of time the shareholder has maintained his or her account with the Fund.
Portfolio Managers
- ------------------
The following disclosures are made about the name and title of the person
or persons employed by or associated with the Fund's investment adviser, Bridges
Investment Counsel, Inc., who are primarily responsible for the day-to-day
Bridges Investment Fund, Inc. 24 April 29, 1996
Prospectus -- Part A
management of the Fund's portfolio as well as the length of their service and
business experience during the past five years.
Mr. Edson L. Bridges II, President of the Fund and President of Bridges
Investment Counsel, Inc., is primarily responsible for the day-to-day management
of the Firm's portfolio. Mr. Bridges II has conducted this responsibility for
the past five years, and, in fact, for the entire span of the Fund's more than
32 years of operation.
Mr. Edson L. Bridges III, Executive Vice President of the Fund and
Executive Vice President - Investments of Bridges Investment Counsel, Inc., is
the backup person for the day-to-day operation of the Fund's portfolio. Mr.
Bridges III has dedicated the last five years as a research person and portfolio
manager for Bridges Investment Counsel, Inc. Mr. Bridges III has been employed
in these areas of responsibility for all clients, including Bridges Investment
Fund, Inc., for more than 11 years.
Pending Legal Proceedings: None:
- -------------------------
NOTICE 1: Part B of this filing entitled Information Required in a Statement of
Additional Information contains supplemental information on the Fund on the
following subjects: General Information and History; Investment Objectives and
Policies; Management of the Fund; Control Persons and Principal Holders of
Securities; Investment Advisory and Other Services; Brokerage Allocation and
Other Practices; Capital Stock and Other Securities; Purchase, Redemption and
Pricing of Securities Being Offered; Tax Status; and Financial Statements.
NOTICE 2: Part C of this filing entitled Other Information embodies other
items for a proper filing of this Fund with the Securities and Exchange
Commission, many of which are incorporated by reference because the submission
of the material was completed in previous years to the current filing of
Amendments to the required Forms of the Securities Act of 1933 and the
Investment Company Act of 1940. Nonetheless, Part C will contain: Financial
Statements and Exhibits; Persons Controlled by or Under Common Control with
Registrant; Number of Holders of Securities; Indemnification; Business and Other
Connections of Investment Adviser; Principal Underwriters; Location of Accounts
and Records; Management Services; and Undertakings.
NOTICE 3: As a prospective investor or a shareholder, you may be interested in
this information. You may request Part B and/or Part C from the Fund at the
PART B
INFORMATION REQUIRED IN A STATEMENT
OF ADDITIONAL INFORMATION
PROSPECTUS Bridges Investment Fund, Inc. CAPITAL STOCK
April 29, 1996 8401 West Dodge Road
Omaha, Nebraska 68114
402-397-4700
- - --------------------------------------------------------------------------
Special Notices
. This Statement of Additional Information is not a Prospectus.
. This Statement of Additional Information should be read in conjunction with
the Prospectus of Bridges Investment Fund, Inc. dated April 29, 1996.
. Other Information, Part C, of the filing dated April 29, 1996, by Bridges
Investment Fund, Inc. with the Securities and Exchange Commission may
contain useful material for prospective investors and shareholders.
. A copy of the Prospectus of Bridges Investment Fund, Inc. and Part C may be
obtained from the office of the Fund at the address shown above.
. The date of this Statement of Additional Information is April 29, 1996.
Bridges Investment Fund, Inc. 2 April 29, 1996
Statement -- Part B
TABLE OF CONTENTS
Location of Related Location
Disclosure Info. Page No.
in Prospectus in This
Part A Information Required in Statement of Addl. Info. Part B
- ------ ----------------------------------------------- ------
- Cover Page ............................................1
- Table of Contents .....................................2
6 General Information and History .......................3
6 Investment Objectives and Policies ...................3-6
6 Primary and Secondary ..............................3
- Investment and Policy Restrictions ................3-5
5 Portfolio Turnover .................................5
8 Management of the Fund ................................6
- Directors and Officers ............................6-10
12 Control Persons and Principal Holders of Securities ...11
9-12 Investment Advisory and Other Services ................14
- Control Persons ....................................14
- Affiliated Persons .................................15
9 Advisory Fees ......................................14
11 Expense Limitation .................................15
- Services Performed on Behalf of Fund ...............15
Supplied or Paid for Substantially by
Investment Adviser
11 Other Services .....................................15
11 Brokerage Allocation and Other Practices ..............16
12 Capital Stock and Other Securities ....................18
12 Classes ............................................18
Cumulative Voting ..................................18
14 Purchase, Redemption, and Pricing of Securities .......18
Being Offered
- General Information..............................18
14 Valuation........................................18
Specimen Price Make Up Sheet...................18,20
22 Other Disclosures................................19
13 Tax Status ............................................19
- Underwriters ..........................................19
- Calculation of Performance Data .......................19
- Financial Statements ................................21-36
Report of the Independent Public Accountants .......21
Schedule of Investments ..........................22-28
Statement of Assets and Liabilities ................29
Statement of Operations ............................30
Statements of Changes in Net Assets ................31
Notes to Financial Statements ....................32-36
Bridges Investment Fund, Inc. 3 April 29, 1996
Statement -- Part B
General Information and History
- -------------------------------
The Registrant has been solely in the business of an open-end, regulated
investment management company since inception on July 1, 1963. The Fund's name
has been the same throughout its corporate life. For more information, refer to
page 6 of the Prospectus.
Investment Objectives and Policies
- ----------------------------------
Primary and Secondary -- The primary investment objective of the Fund is
---------------------
long-term capital appreciation. The development of a modest amount of current
income is a secondary investment objective of the Fund. Common stocks and
securities convertible into common stocks will be utilized to reach the capital
growth objective. Bonds, debentures, and preferred stocks are acquired or held
to fulfill the modest income objective. Refer to pages 6-8 of the Prospectus
for a complete discussion of the investment policy objectives for the Fund and
the practices employed to attain the goals set forth herein.
Investment and Policy Restrictions -- The activities of the Fund and its
----------------------------------
investment policies are restricted as set forth in the following discussion.
These restrictions cannot be changed without the approval of a majority of the
outstanding voting securities of the Fund.
The Fund will not concentrate its investments in a particular industry or
group of industries by committing more than 25% of total assets to securities in
any one industry. With the exception of investments in U.S. Government
securities, the Fund will not make investments which will cause more than 5% of
the total value of its assets (at the time of purchase) to be invested in the
securities of any one issuer. Furthermore, in initial or subsequent
investments, the Fund may not acquire more than 10% of the voting stock of any
one issuer, and the Fund may not acquire more than 10% of any one class of the
outstanding securities of any one issuer. For the purposes of this restriction,
all kinds of securities of a company representing debt are considered as a
single class irrespective of their differences, and all kinds of preferred stock
of a company are considered a single class irrespective of their differences.
The Fund will not borrow money or pledge or mortgage its assets, except as
a temporary measure, in which event total borrowings shall not exceed 10% of the
value of its total assets. The option to borrow money as a temporary measure
has never been exercised. In addition, the Fund may not purchase securities on
margin or make short sales.
The Fund will not make investments which will cause more than 5% of the
value of its total assets (at the time of purchase) to be invested in securities
Bridges Investment Fund, Inc. 4 April 29, 1996
Statement -- Part B
of issuers which have a record of less than three years' operation.
The Fund will not invest in companies for the purpose of exercising control
or management, and the Fund will not invest in securities of other investment
companies except by purchase in open market, where no commission or profit to a
sponsor or dealer results from such purchase other than the customary broker's
commission, or where the acquisition is part of a plan of merger or
consolidation. Such acquisitions, if any, of the securities of other registered
investment companies shall be unlawful for the acquiring company if immediately
after such purchase or acquisition the acquiring company owns in the aggregate:
1. more than 3 per centum of the outstanding voting stock of another
investment company;
2. securities issued by the acquired company having an aggregate value in
excess of 5 per centum of the value of the total assets of the Fund;
or
3. securities issued by the acquired company and all other investment
companies (other than Treasury stock of the acquiring company) having
an aggregate value in excess of 10 per centum of the value of the
total assets of the Fund.
Each investment of the Fund will be made with the expectation that the
security acquired will be held for the long term. The Fund will not purchase
securities with a view towards rapid turnover for capital gains. However, the
management may sell securities for short term gains or losses if new information
or changes in market conditions indicate such selling action is advisable.
The Fund will not invest outside of the area of securities. It will not
purchase or sell real estate, commodities or commodity contracts. The Fund will
not make loans to other persons. (The acquisition of a portion of an issue of
publicly distributed bonds, debentures, or other debt securities is not to be
considered the making of a loan.)
The Fund will not engage in the underwriting of the securities of other
issuers.
The Fund will not purchase restricted or non-registered securities.
The Fund will not purchase or sell put or call options, except the Fund may
write or sell call options against shares held in its securities portfolio on
the American Stock Exchange, Inc., the Chicago Board Options Exchange,
Bridges Investment Fund, Inc. 5 April 29, 1996
Statement -- Part B
Incorporated, the Pacific Stock Exchange Incorporated, and the PBW Stock
Exchange, provided that any such call options will be limited to shares of
common stocks which have an aggregate market value of less than 10% of the total
value of the Fund's assets at the time of the transaction, and further provided
that not more than one-half of the shares held in any one issuer will be
eligible for the writing of such call options. The Fund may purchase a call
option with terms identical to a call option which has been previously written
in order to liquidate or close an existing call option position. Prior to
December 31, 1995, the Fund had not exercised its authority to write a covered
call option.
The Fund may purchase bonds, debentures, and preferred stocks which have
one or more interest or dividend payments in arrears, but, nevertheless, offer
prospects of resuming the payment of the arrearage plus the current income rate.
Such securities may offer a significant price improvement from a depressed
level, thereby creating a capital gain potential similar to the advancement
possible for common stock selections. The risk of owning this type of security
is that income payments will not be resumed or that the principal will never be
repaid. Further, the Fund may acquire issues, sometimes known as junk bonds,
with above average yield and balance sheet risk. The purchase of this lower
grade of securities will be limited to 5% of the value of the total assets of
the Fund. This permitted investment policy has seldom been used in the past
history of the Fund, and it would only be employed in an exceptionally
attractive circumstance in the judgment of the investment manager.
With respect to the ownership of U.S. Government securities, the Fund will
invest primarily in issues of the Treasury that are backed by the full faith and
credit of the United States of America. The Fund may purchase Bills, short
term; Notes, intermediate term; and Bonds, long term instruments depending upon
the attractiveness of interest rates and the expected trends of these yields in
the future.
Portfolio Turnover -- In the ten years ending December 31, 1995, the
------------------
portfolio turnover rate for the Fund ranged from a high of 31% in both 1987 and
1988 to a low of 7% in 1992 and 1995. The mean average portfolio turnover for
the past 10 years was 21%. The portfolio turnover rate in 1995 was 7%. The
Registrant has no plans to materially change the portfolio turnover rate for the
Fund from the experience of the past as just described; however, portfolio rates
could increase significantly in order to respond to turbulent conditions in the
securities market. Refer to page 6 of the Prospectus for detailed year-to-year
information on the portfolio turnover rate.
The rate of portfolio turnover shall be calculated by dividing (a) the
lesser of purchases or sales of portfolio securities for the reporting period by
Bridges Investment Fund, Inc. 6 April 29, 1996
Statement -- Part B
(b) the monthly average of the value of the portfolio securities owned by the
registrant during the reporting period. Such monthly average shall be
calculated by totaling the market values of the portfolio securities as of the
beginning and end of the first month of the reporting period and as of the end
of each of the succeeding months in the period and dividing the sum by the
number of months in the period plus one.
For purposes of this explanation, there shall be excluded from both the
numerator and denominator all securities, including options, whose maturity or
expiration date at the time of acquisition were one year or less. All long-term
securities, including long-term U.S. Government securities, should be included.
Purchases shall include any cash paid upon the conversion of one portfolio
security into another. Purchases shall also include the cost of rights or
warrants purchased. Sales shall include the net proceeds from the sale of
rights or warrants. Sales shall also include the net proceeds of portfolio
securities which have been called or for which payment has been made through
redemption or maturity.
This information is not generally available to the shareholders or
interested public, but the explanation above details the manner in which the
portfolio turnover rate shown on page 6 of the Prospectus is calculated. In
general, portfolio turnover rises when securities held need to be repositioned
to adapt the Fund's investment position to new opportunities or to protect
against unforeseen, adverse market circumstances.
Management of the Fund
- ----------------------
Directors and Officers -- The Board of Directors of the Fund is responsible
----------------------
for the management of the business affairs of the Fund. The day-to-day
operation of the Fund is handled by the officers who are chosen by, and
accountable to, the Board of Directors. The officers have at their disposal the
services of the investment adviser, Bridges Investment Counsel, Inc. This Firm
is obligated under its investment advisory contract with the Fund to perform all
services necessary in connection with the management of the Fund. The business
experience of each of the officers and directors of the Fund and of the
investment adviser during the past five years is as follows:
Frederick N. Backer, Chairman of the Board, Director of the Fund, member of
the Executive Committee and the Audit Committee of the Board of Directors of the
Fund, 8401 West Dodge Road, Omaha, Nebraska. Mr. Backer is currently the
President of JAT Corp. which operates a Sizzler Family Steak House in St.
Joseph, Missouri. His responsibility to this concern commenced in August, 1972.
Mr. Backer is an interested person member of the Board of Directors of the Fund,
which is defined in Section 2(a)(19) of the Investment Company Act of 1940. In
Bridges Investment Fund, Inc. 7 April 29, 1996
Statement -- Part B
the context of this Prospectus, an interested person is someone who has a
material business or professional relationship with the Fund's investment
adviser, Bridges Investment Counsel, Inc. or its principal officers.
Edson L. Bridges II, President and Director of the Fund and member of the
Executive Committee and Audit Committee of the Board of Directors, 8401 West
Dodge Road, Omaha, Nebraska. In September, 1959, Mr. Bridges became associated
with the predecessor Firm to Bridges Investment Counsel, Inc., and he is
presently the President and a Director of that Firm. Mr. Bridges holds the
distinction of being a Chartered Financial Analyst. Mr. Bridges is an
affiliated person member of the Board of Directors of the Fund.
Edson L. Bridges III, Executive Vice President and Director of the Fund and
member of the Executive Committee of the Board of Directors of the Fund, 8401
West Dodge Road, Omaha, Nebraska. Mr. Bridges has been a full-time member of
the professional staff of Bridges Investment Counsel, Inc. since August, 1983,
and a part-time member from January 1, 1983. Mr. Bridges has been responsible
for research into common stocks and consulting for certain clients of the Firm
throughout the period of his employment. Mr. Bridges was elected a Vice
President of the Fund on June 28, 1985. Mr. Bridges earned the professional
recognition of a Chartered Financial Analyst in 1987. Mr. Bridges is an
affiliated person member of the Board of Directors of the Fund.
N. Phillips Dodge, Jr., Director of the Fund and member of the Executive
Committee of the Board of Directors of the Fund, 8701 West Dodge Road, Omaha,
Nebraska. Mr. Dodge is President of N. P. Dodge Company, a leading commercial
and residential real estate brokerage concern in the area of Omaha, Nebraska.
Mr. Dodge has held this position since July, 1978. Mr. Dodge is also a
principal officer and director of a number of subsidiary and affiliated
companies in the property management, insurance, real estate syndication and
cemetery businesses, and he is a publicly elected director of the Omaha Public
Power District. Mr. Dodge is an interested person member of the Board of
Directors of the Fund.
John W. Estabrook, Director of the Fund and member of the Audit Committee
of the Board of Directors of the Fund, 10542 Mullen Road, Omaha, Nebraska. Mr.
Estabrook was the Chief Administrative Officer of the Nebraska Methodist
Hospital in Omaha, Nebraska, from June, 1959, to December, 1986. Mr. Estabrook
continued as the Chief Executive Officer of the Nebraska Methodist Health
System, Inc., which offers a variety of services to other health care providers
in the Midwest region, until August, 1992, when he retired. Mr. Estabrook is an
interested person member of the Board of Directors.
Bridges Investment Fund, Inc. 8 April 29, 1996
Statement -- Part B
Jon D. Hoffmaster, Director of the Fund and member of the Audit Committee
of the Board of Directors of the Fund, 5711 South 86th Circle, Omaha, Nebraska.
Mr. Hoffmaster serves as Vice Chairman of the Board of Directors of American
Business Information, Inc. From 1987 to September, 1991, Mr. Hoffmaster served
as Executive Vice President of the Company. From September, 1991, to September,
1993, Mr. Hoffmaster served as President and Chief Operating Officer of the
Company. He became Chief Financial Officer in June, 1992, and assumed the
position of Vice Chairman of the Board in September, 1993. From 1980 to 1987,
Mr. Hoffmaster was President and Chief Executive Officer of First National Bank
of Bellevue, Nebraska. Mr. Hoffmaster is an interested person member of the
Board of Directors of the Fund.
John J. Koraleski, Director of the Fund and member of the Executive
Committee of the Board of Directors of the Fund, 1416 Dodge Street, Omaha,
Nebraska. Mr. Koraleski is Executive Vice President-Finance and Information
Technologies of the Union Pacific Railroad Company headquartered in Omaha,
Nebraska. As Chief Financial Officer of the railroad, Mr. Koraleski heads and
manages the financial planning and management functions for the railroad, and he
is responsible for the operations of the Company's information and
telecommunications technologies. He was appointed to his present position in
September, 1991. He has served the Union Pacific Railroad Company in various
capacities since June, 1972.
Roger A. Kupka, Director of the Fund and member of the Executive Committee
of the Board of Directors of the Fund, 2305 South 103rd Street, Omaha, Nebraska.
Mr. Kupka is the Retired President and Chief Executive of Nebraska Builders
Products Co. of Omaha, Nebraska. He held this position from 1969 to November,
1986. Nebraska Builders Products Co. sold or distributed adhesives, brick,
caulking, insulation, roofing, sealants, and specialty products. Since August,
1992, Mr. Kupka holds the position of Vice Chairman of the Board of Directors of
PSI Group, formerly known as Discount Mail, Inc., headquartered in Omaha,
Nebraska.
Gary L. Petersen, Director of the Fund and member of the Executive
Committee, 30 Bishop Square, Lincoln, Nebraska. Mr. Petersen is the Retired
President of Petersen Manufacturing Co. Inc. of DeWitt, Nebraska. Mr. Petersen
commenced employment with that company in February, 1966, became President in
May, 1979, and retired in June, 1985. Petersen Manufacturing Co. Inc. produced
a broad line of hand tools for national and worldwide distribution under the
brand names Vise-Grip, Unibit, Prosnip, and Punch Puller. Mr. Petersen is an
interested person member of the Board of Directors of the Fund.
Bridges Investment Fund, Inc. 9 April 29, 1996
Statement -- Part B
Roy A. Smith, Director of the Fund and member of the Executive Committee of
the Board of Directors of the Fund, 5051 L Street, Omaha, Nebraska. Mr. Smith
is President of H. P. Smith Motors, Inc., a leading dealership for the Ford
Motor Co., and he is also President of Old Mill Toyota Inc. Mr. Smith is a
Director of the Mid City Bank of Omaha.
L.B. Thomas, Director of the Fund and member of the Executive Committee of
the Board of Directors of the Fund, One ConAgra Drive, Omaha, Nebraska. Mr.
Thomas is Senior Vice President-Risk Officer and Corporate Secretary for
ConAgra, Inc., a major international processor of food products. Mr. Thomas
joined ConAgra as Assistant to the Treasurer in 1960, and his career has
progressed through that company since that time. He became Vice President,
Finance in 1969, Treasurer in 1974, and Corporate Secretary in 1982. He assumed
his present duties during 1993.
Douglas P. Person, Vice President of the Fund, 8401 West Dodge Road, Omaha,
Nebraska. Mr. Person has been a full-time member of the professional staff of
Bridges Investment Counsel, Inc. since September, 1985, and he is currently a
Vice President of that Firm. Prior to that time, Mr. Person served as a
Legislative Aide in the Nebraska State Legislature in 1985. During 1984, Mr.
Person held the position of Trust Marketing representative for the First
National Bank of Lincoln, Lincoln, Nebraska. From July, 1982, through March,
1984, Mr. Person was a registered representative for Shearson/American Express
in Lincoln, Nebraska. Mr. Person was elected an Assistant Vice President of the
Fund on January 12, 1988, with the appointment becoming effective on February 1,
1988.
Mary Ann Mason, Secretary of the Fund, 8401 West Dodge Road, Omaha,
Nebraska, was employed as a Staff Secretary of Bridges Investment Counsel, Inc.
in June, 1981. She was appointed Corporate Secretary for Bridges Investment
Counsel, Inc. in 1987, and was elected Assistant Secretary of the Fund on April
13, 1988. Mrs. Mason became Secretary of the Fund on February 20, 1990.
Nancy K. Dodge, Treasurer of the Fund, 8401 West Dodge Road, Omaha,
Nebraska was employed by Bridges Investment Counsel, Inc. in January, 1980, as
an entry level person in Staff Services and Accounting. Mrs. Dodge progressed
through various positions in the accounting area to become manager of that
department of the Firm in 1986. During 1988, she advanced to the position of
Executive Assistant and then Assistant to the President in 1992. Mrs. Dodge was
elected Assistant Treasurer of the Fund on April 11, 1986, and she became
Treasurer of the Fund on April 12, 1991.
Kathleen J. Stranik, Assistant Secretary of the Fund, 8401 West Dodge Road,
Omaha, Nebraska was employed by Bridges Investment Counsel, Inc. as a secretary
Bridges Investment Fund, Inc. 10 April 29, 1996
Statement -- Part B
in January, 1986. Mrs. Stranik has assumed additional administrative
responsibilities during her career with the investment adviser and currently
holds the position of Executive Secretary. Mrs. Stranik was elected Assistant
Secretary of the Fund on April 13, 1995.
Rosemary M. Teckmeyer, Vice President of the Fund, 8401 West Dodge Road,
Omaha, Nebraska. Mrs. Teckmeyer was employed by Bridges Investment Counsel,
Inc. as a statistician in September, 1967. Mrs. Teckmeyer has served in many
capacities for Bridges Investment Counsel, Inc. since that date. She is
presently Vice President and Treasurer of that Firm, and she was elected
Treasurer of Bridges Investment Fund, Inc. on April 13, 1973, after holding the
position of Assistant Treasurer for several years. Mrs. Teckmeyer was elected a
Vice President of the Fund on April 12, 1991.
The Board of Directors of the Fund has an Audit Committee and an Executive
Committee. The members of these Committees are appointed annually at the April
meeting of the Board of Directors. The members of the Audit Committee in 1996
are: Frederick N. Backer, John W. Estabrook, Jon D. Hoffmaster, and Edson L.
Bridges II, ex-officio. The members of the Executive Committee in 1996 are:
Frederick N. Backer, Edson L. Bridges II, Edson L. Bridges III, N. P. Dodge,
Jr., John J. Koraleski, Roger A. Kupka, Gary L. Petersen, Roy A. Smith, and L.B.
Thomas. The Executive Committee reviews all contracts and other business
relationships of the Fund. The Executive Committee will act on behalf of the
full Board of Directors on any matter requiring action prior to the next meeting
of the Board. The Executive Committee also acts as a Nominating Committee for
replacement of retiring directors.
The officers and directors of the Fund do not receive any salaries or fees
from the Fund for their services to the Fund in such capacities. However,
during 1995, the directors as a group received $8,583.95 from Bridges Investment
Counsel, Inc. for compensation related to attendance at meetings of the Board of
Directors, the Audit Committee, and the Executive Committee of the Fund.
The following aggregate compensation in excess of $60,000 per compensated
person information is provided for all directors of the Fund and for each of the
three highest paid executive officers or any affiliated person of the Fund for
the most recently completed fiscal year (1995):
Bridges Investment Fund, Inc. 11 April 29, 1996
Statement -- Part B
</TABLE>
<TABLE>
COMPENSATION TABLE
<CAPTION>
(1) (2) (3) (4) (5)
Total
Compensation
Aggregate Pension or Estimated From Registrant
Compensation Retirement Annual and Fund Complex
Name of Person, From Benefits Accrued as Part Benefits Upon Paid to
Position Registrant of Fund Expenses Retirement Directors
- -------- ---------- ---------------- ---------- ---------
<S> <C> <C> <C> <C>
- ---
Three Highest Paid Executive Officers:
- --------------------------------------
Edson L. Bridges II None None None None
Pres. and Director
Edson L. Bridges III None None None None
Exec. Vice Pres.
and Director
Douglas P. Person None None None None
Vice President
Directors of the Fund:
- ----------------------
Frederick N. Backer None None None None
N. P. Dodge, Jr. None None None None
John W. Estabrook None None None None
Jon D. Hoffmaster None None None None
John J. Koraleski None None None None
Roger A. Kupka None None None None
Gary L. Petersen None None None None
Roy A. Smith None None None None
L.B. Thomas None None None None
</TABLE>
There are no material provisions of any pension, retirement, or other plan or
arrangement other than the disclosure arrangements made in the table above that
require disclosure herein.
Control Persons and Principal Holders of Securities
- ---------------------------------------------------
No person or shareholder has control of Bridges Investment Fund, Inc.
Control is defined to mean the beneficial ownership, either directly or
indirectly, of more than 25% of the voting securities of the Fund.
There are two groupings of family members who owned of record or
beneficially more than 5% of the Fund's outstanding capital stock as of January
31, 1996, when the Fund had a total of 1,137,162 shares outstanding: The family
of William R. Alford, Sr. and the family of Edson L. Bridges II.
William R. Alford and his son John Alford, both of 810 South Skyline Drive
in Elkhorn, Nebraska 68022, are the only other family grouping to hold 5% of the
total shares outstanding. William Alford holds 58,136 in an IRA Rollover
account and 662 shares personally. John Alford owns 379 shares. Mr. Barry L.
Bergland, son-in-law of Mr. William R. Alford, resides at 519 South 215th
Street, Elkhorn, Nebraska 68022. Mr. Bergland holds 348 shares in an IRA
Rollover Account. Accordingly, the total ownership of the family of William R.
Alford is 59,525 shares or 5.2% of the total shares outstanding on January 31,
1996.
The family of Edson L. Bridges II is composed of the following members:
Sally S. Bridges, wife; Edson L. Bridges III, a married son; Jennifer B. Hicks,
a married daughter; Robert W. Bridges, a married son; and Marvin W. Bridges,
Jr., a brother. The Edson L. Bridges II residence address is 10725 Cedar
Street, Omaha, Nebraska 68124. The Edson L. Bridges III home address is 760
Fairacres Road, Omaha, Nebraska 68132. The address for Jennifer B. Hicks is
1120 South 61st Street, Omaha, Nebraska 68106. Robert W. Bridges lives at 3408
North 125th Avenue, Omaha, Nebraska 68164. Marvin W. Bridges, Jr. resides at
1425 Shire Circle, Inverness, Illinois 60067. Edson L. Bridges III's wife is
Tracy T. Bridges. Robert W. Bridges' spouse is Elizabeth H. Bridges.
The beneficial ownership in the Edson L. Bridges II branch of family
members is as follows: Edson L. Bridges II, 12,746 shares in his own name;
7,534 shares in the Bridges Investment Counsel, Inc. Profit Sharing Trust; 3,289
shares in the Bridges Investment Counsel, Inc. Pension Plan; and 1,973 shares in
the master plan Individual Retirement Act and Simplified Employee Pension
Accounts for a total of 25,542 shares. Sally S. Bridges holds 3,565 shares in
her own name and 1,177 shares in the master plan Individual Retirement Act
Account for a total of 4,742 shares. Edson and Sally have a combined beneficial
ownership of 30,284 shares. Edson L. Bridges III has 718 shares through a one-
third beneficial interest in the Edson L. Bridges II Irrevocable Trust; 1,837
shares in the Bridges Investment Counsel, Inc. Profit Sharing Trust plus 3,319
shares in the 401(k) feature of that Trust; 627 shares in the Bridges Investment
Counsel, Inc. Pension Plan and 996 shares in a master plan Individual Retirement
Act Account for a total of 7,497 shares. Tracy T. Bridges owns 7,418 shares in
a 401(k) plan with the First National Bank of Omaha as Custodian and 251 shares
in a master plan Individual Retirement Act Account for a total of 7,669 shares.
Edson III and Tracy have a combined beneficial ownership of 15,166 shares.
Jennifer B. Hicks has 718 shares through a one-third beneficial interest in the
Edson L. Bridges II Irrevocable Trust; 169 shares in the Bridges Investment
Counsel, Inc. Profit Sharing Trust; 45 shares in the Bridges Investment Counsel,
Inc. Pension Plan; and 231 shares in the master plan Individual Retirement Act
Account for a total of 1,163 shares. Robert W. Bridges has 412 shares in his
own name; 718 shares through a one-third beneficial interest in the Edson L.
Bridges II Irrevocable Trust; 180 shares in the Bridges Investment Counsel, Inc.
Profit Sharing Trust plus 344 shares in the 401(k) plan; 91 shares in the
Bridges Investment Counsel, Inc. Pension Trust, and 193 shares in the master
plan Individual Retirement Act Account for a total of 1,938 shares. Robert W.
Bridges Investment Fund, Inc. 13 April 29, 1996
Statement -- Part B
Bridges and Elizabeth H. Bridges own jointly 1,076 shares for a combined
ownership of 3,014 shares. The total for beneficial amounts attributable to the
family branch of Edson L. Bridges II is 49,627 shares or 4.4% of the total
shares outstanding on January 31, 1996.
Marvin W. Bridges, Jr. is a brother of Edson L. Bridges II. Mr. Bridges
resides at 1425 Shire Circle, Inverness, Illinois 60067. Marvin W. Bridges, Jr.
has two married daughters: Ann B. Bruce, 266 Eriksen Avenue, Bainbridge Island,
Washington 98110 and Amy B. Lawrence, 8225 N.E. 159th Street, Bothell,
Washington 98011. Mr. Edson L. Bridges II is Trustee of the Marvin W. Bridges,
Jr. Charitable Remainder Unitrust, of which Marvin W. Bridges Jr. is a life
income beneficiary, and multiple charities are principal beneficiaries, that
owns 10,026 shares. The Marvin W. Bridges, Jr. Irrevocable Trust, Provident
Trust Company Successor Co-Trustee with Edson L. Bridges II, Co-Trustee, owns
1283 shares, in which Mrs. Bruce and Mrs. Lawrence each have a one-half interest
in the trust as principal beneficiaries. Mrs. Lawrence owns 247 shares in a
master plan Individual Retirement Act account. The total shares attributed
directly or indirectly to the members of the Marvin W. Bridges, Jr. family are
11,556 or 1.0% of the total shares outstanding.
To summarize the total beneficial ownership of the two family branches of
the Bridges family (49,627 for Edson II and 11,556 for Marvin, Jr.) is 61,183
shares equal to 5.4% of total shares outstanding. No one person in this family
owns of record or beneficially more than 5% of the total shares outstanding.
The officers and directors of the Fund owned beneficially and of record, or
had the power to vote, 93,902 shares of the Fund's stock. The members of the
immediate families of officers and directors owned an additional 89,565 shares
for a total beneficial ownership of these persons of 183,467 shares which was
equal to 16.1% of the 1,137,162 shares outstanding as of January 31, 1996.
With respect to the attributed beneficial share interests reported for
officers of the Fund for holdings of the Fund by the Bridges Investment Counsel,
Inc. Pension Plan and the Bridges Investment Counsel, Inc. Profit Sharing Trust,
all shares reported are estimates as of January 31, 1996. The Trustees of the
Pension Plan and the Profit Sharing Trust will not report the allocations to
participants for December 31, 1995, until March 15, 1996, because the financial
information upon which the allocations are made to participants was not complete
on the February 27, 1996, filing date for this Prospectus and Statement, and
such information usually is not available for a variety of reasons and factors
related to the calculation of bonuses for employees and the filing of the
Bridges Investment Fund, Inc. 14 April 29, 1996
Statement -- Part B
corporate Federal Income Tax for Bridges Investment Counsel, Inc. Accordingly,
the disclosure of beneficial interests in the Pension Plan and Profit Sharing
Trust are based upon December 31, 1994, and September 30, 1995, percentage
interests for allocations of the January 22, 1996, shares owned by these trusts.
Bridges Investment Counsel, Inc. initiated a 401(k) additional feature to
the Firm's Profit Sharing Trust in 1988. The National Bank of Commerce Trustee
holds 4,176 shares for four participants, two of whom are Edson L. Bridges III
and Robert W. Bridges, as disclosed earlier. Two of the other participants are
officers of the Fund and its investment adviser: Douglas P. Person, whose
ownership interest is 493 shares and Kathleen J. Stranik, whose ownership
interest is 20 shares.
Unless noted to the contrary, all disclosures of shareholder ownership in
this section of the Statement of Additional Information are made as of the close
of business on January 31, 1996.
Investment Advisory and Other Services
- --------------------------------------
Control Persons -- Two persons, Edson L. Bridges II and Edson L. Bridges
---------------
III, of the eleven members of the Board of Directors of the Fund are also
directors and officers of the investment adviser, Bridges Investment Counsel,
Inc.
Mr. Bridges is President and director of both companies. The total of 600
shares of capital stock of the investment adviser are owned as follows: Edson
L. Bridges II, 525 shares; Edson L. Bridges III, six shares; Sally S. Bridges,
wife of Edson L. Bridges II, three shares; and National Bank of Commerce, as
Trustee for the Bridges Investment Counsel, Inc. Profit Sharing Trust, 66
shares.
Sally S. Bridges, Edson L. Bridges II, and Edson L. Bridges III are the
three directors of Bridges Investment Counsel, Inc. Mr. and Mrs. Edson L.
Bridges II have been directors of Bridges Investment Counsel, Inc. since January
2, 1963. Mr. Edson L. Bridges III was elected a Director on December 30, 1987.
Affiliated Persons -- As a director and President of both Bridges
------------------
Investment Counsel, Inc. and Bridges Investment Fund, Inc., Mr. Edson L. Bridges
II is an affiliated person of each organization. As an officer of the Fund and
as an officer and director of Bridges Investment Counsel, Inc., Mr. Edson L.
Bridges III is an affiliated person of both organizations. There are no other
affiliated persons of the investment adviser and the Fund.
Bridges Investment Fund, Inc. 15 April 29, 1996
Statement -- Part B
Advisory Fees -- Bridges Investment Fund, Inc. paid Bridges Investment
-------------
Counsel, Inc. the following dollar amounts for the last three fiscal years as an
investment advisory fee: $89,492 in 1993; $91,600 in 1994, and $107,149 in
1995. These fees are based on the month-ending net assets, averaged for a
three-month period, and a 1/8 of 1% fee basis is applied to the resulting
number. The annual fee basis is 1/2 of 1%. The annual fee is the sum of the
four quarterly fees. The advisory fee was not reduced by any credits during two
of the last three fiscal years.
Expense Limitation -- Bridges Investment Counsel, Inc. has agreed with the
------------------
Fund to pay any expenses, properly owed by the Fund, which exceed 1 1/2% of the
average net assets for any year. There have been no expense reimbursements
during the last three fiscal years.
Services Performed on Behalf of Fund -- Services which are supplied or paid
------------------------------------
for wholly or in substantial part by the investment adviser in connection with
the investment advisory contract are: occupancy and office rental; services of
outside legal counsel; registration and filing fees; salaries and compensation
of the Fund's directors and officers; trading department of securities; and
Prospectus preparation and printing. In effect, Bridges Investment Counsel,
Inc. supplies all personnel, equipment, facilities, and administrative services
at its expense that would be provided for all investment advisory clients of the
Firm. In addition, Bridges Investment Counsel, Inc. pays for all expenses of
maintaining Federal and State registrations and all legal expenses of the Fund
including the costs associated with Master Plans for Standard Retirement Plans
and Individual Retirement Act accounts. Lastly, the Investment Adviser performs
all services not specifically identified to ensure an orderly business operation
of the Fund.
The Fund pays Bridges Investment Counsel, Inc. for accounting, clerical,
and bookkeeping services related solely to special functions for the Fund and
for postage, stationery, forms, supplies and printing -- including quarterly
reports to shareholders. Bridges Investment Counsel, Inc. provides the staff
personnel and services for these tasks, and the Advisory Firm is reimbursed at
its cost for these services.
Other Services -- The Fund pays for the services of the independent
--------------
auditor, Arthur Andersen LLP, 1700 Farnam Street, Omaha, Nebraska 68102. The
Fund also absorbs the fees and costs of First Bank N.A. Omaha, Nebraska, 1700
Farnam Street, Omaha, Nebraska 68102 as Custodian. Bridges Investor Services,
Inc., 8401 West Dodge Road, Omaha, Nebraska 68114, acts as Dividend Disbursing
and Transfer Agent. The Fund pays costs and fees per the terms of an Agreement
between the Fund and Services. The Fund also bears the cost of the insurance
premiums to provide $500,000 in fidelity and errors and omissions coverages
Bridges Investment Fund, Inc. 16 April 29, 1996
Statement -- Part B
under an Investment Company Blanket Bond effective April 1, 1988. ICI Mutual
Insurance Company, P.O. Box 730, Burlington, Vermont 05402-0730 is the carrier
supplying the coverage. The persons or corporations identified in this
paragraph are the only providers of services to the Fund other than Bridges
Investment Counsel, Inc.
Arthur Andersen LLP conducts the annual audit of the Fund's operation in
accordance with generally accepted auditing standards, the applicable
regulations of the Securities and Exchange Commission, and the provisions of the
Internal Revenue Code. Representatives of Arthur Andersen LLP meet with the
Audit Committee of the Board of Directors to establish the scope of each audit.
The Federal and State income tax returns are prepared by the staff of Arthur
Andersen LLP. Lastly, Arthur Andersen LLP provides consents to permit the
filing of financial statements with appropriate documents with the Securities
and Exchange Commission at various times throughout the year, and a partner of
the Firm or his representative will be in attendance at the annual meeting of
stockholders to answer any inquiries at that time.
The services of First Bank N.A. Omaha, Nebraska and Bridges Investor
Services, Inc. are described on pages 10 and 11 of the Prospectus.
Brokerage Allocations and Other Practices
- -----------------------------------------
Transactions in the Fund's portfolio of securities are effected through
more than a few brokers to reflect the availability of security research
information, execution and other open market services, and goodwill or other
factors.
The total brokerage fees paid on securities transactions for the Fund for
the last three fiscal years were: $5,451.26 in 1993, $11,321.81 in 1994, and
$4,668.50 in 1995. The Fund's management has no plans to vary the brokerage
commission activity from the pattern shown during the last three fiscal years.
During 1995, the brokerage commissions attributed to security research
information were $4,121.00 or 88.27% of the total, with $547.50 or 11.73% of the
total commissions directed towards market services. There were no commissions
attributed to goodwill in 1995.
A total of eight brokers was used by the Fund during 1995, resulting in an
average compensation per brokerage firm of $583.56. The largest amount received
by any firm was $1,380.00. The Fund has no plans to concentrate securities
transaction orders with any single broker or group of brokers. There were no
brokerage concerns or individuals acting as brokers who were affiliated with the
Fund or its investment adviser, Bridges Investment Counsel, Inc.
Bridges Investment Fund, Inc. 17 April 29, 1996
Statement -- Part B
The research information purchased with the Fund's brokerage commissions
was provided to the Fund's investment adviser, Bridges Investment Counsel, Inc.,
and this material benefited all clients of that Firm, including the Fund. Many
clients of Bridges Investment Counsel, Inc. participate in an informal program
of placing brokerage transactions to obtain security research information; thus,
the Fund and its investment adviser benefit from the brokerage transactions of
many clients of the investment adviser. Most brokerage firms do not price their
research services; therefore, it is not possible to place a monetary value on
such services.
The advent of negotiated brokerage commissions on May 1, 1975, ended the
uniform commission schedule of New York Stock Exchange member firms. As a
result, it is difficult to construct studies of comparable costs and services on
each security transaction of the Fund. Accordingly, the disinterested directors
of Bridges Investment Fund, Inc. have agreed that Bridges Investment Counsel,
Inc. may cause the Fund to pay a member of an Exchange, broker, or dealer an
amount of commission for effecting a securities transaction by the Fund in
excess of the amount of commission which would have been charged by another
person for effecting such transactions, providing that Bridges Investment
Counsel, Inc. determines in good faith that such commission was reasonable in
relation to the value of the brokerage and research services provided by such
Exchange member, broker, or dealer subject only to the limitations and
definitions contained in Section 28(e) of the Securities Exchange Act of 1934
and to a periodic review by the disinterested directors of the actions of the
investment adviser in directing the brokerage business of the Fund. In other
words, because of the practice of using securities transactions to purchase
brokerage services and research, the Fund may not receive the lowest possible
aggregate execution cost with respect to any given brokerage transaction.
Bridges Investment Counsel, Inc. is able to secure discounts from the
uniform brokerage commission schedule which was in effect on April 30, 1975, for
listed securities during the period from May 1, 1975, through December 31, 1995.
The Board of Directors reviews and approves the level of discounts and the
actual brokerage costs on each transaction in the portfolio at each quarterly
meeting. The investment adviser believes these discounts to be appropriate and
similar to those earned by other institutional portfolios of the size of the
Fund. Mr. Edson L. Bridges II, President of the Fund, and Mr. Edson L. Bridges
III, Vice President of the Fund, select the brokers to be employed for
securities transactions of the Fund, and they determine the acceptability of the
discount.
Bridges Investment Fund, Inc. 18 April 29, 1996
Statement -- Part B
Capital Stock and Other Securities
- ----------------------------------
Classes -- The Fund offers only one class of security outstanding --
-------
capital stock. The terms of this issue are set forth on page 12 of the
Prospectus. There are no other classes of securities authorized by the Articles
of Incorporation.
Cumulative Voting -- The terms of the issuance of capital stock of the Fund
-----------------
provide for cumulative voting. This provision permits a shareholder to allocate
the votes of his shares towards one or more directors in order to increase the
influence of his ownership towards the director or directors selected for his
support in an election of directors.
Purchase, Redemption, and Pricing of Securities Being Offered
- -------------------------------------------------------------
General Information -- The Capital Stock of the Fund is offered to the
-------------------
public at Net Asset Value per share through the Fund's office, which is the only
point of distribution for the Prospectus, Part A, the Statement of Additional
Information, Part B, and Other Information, Part C. The plans for purchase of
shares of the Fund are set forth in the Prospectus on pages 15-22. The Fund
does not use letters of intent, contractual accumulation plans, withdrawal
plans, or exchange privileges. The Fund does offer services in connection with
retirement plans -- please refer to pages 17-22 in the Prospectus for a complete
description of these services.
Shareholders who require assistance in gathering cost history and share
information regarding their account with the Fund should anticipate that Bridges
Investor Services, Inc. as Transfer Agent, will bill the direct costs of such
investigations directly to the shareholder with an explanation of the type of
work conducted, the dates and time committed, and the expenses incurred by
Services. In the normal situation, the maximum charge per inquiry of this type
will be $25.00.
Valuation -- The methods for determining the Net Asset Value per share of
---------
the Fund for purchase of shares and the Net Asset Value per share for the
redemption of or sales of shares back to the Fund are described on pages 14 and
15 of the Prospectus. Please refer to those pages for specific information on
these matters.
Specimen Price Make Up -- Please refer to Appendix A on page 20 for a copy
----------------------
of the Price Make Up form used by the Fund. The example or illustration uses
the actual data and methods used for the Fund on December 31, 1995. The audited
Balance Sheet information will provide the same information with a different
format and classification of items for the purpose of proper financial statement
presentation.
Bridges Investment Fund, Inc. 19 April 29, 1996
Statement -- Part B
Other Disclosures -- The Fund does not have an excess of the offering price
-----------------
to distribute to underwriters. The Fund prices its shares only once per day
after the close of the New York Stock Exchange. There is no difference in the
net offering price charged to the general public and that price which is charged
to officers, directors, and employees of either the Fund or its investment
adviser. The Fund does not use Rule 2a-7 under The General Rules and
Regulations of The Investment Company Act of 1940 for the purpose of pricing its
shares to the public.
Tax Status
- ----------
The Fund is qualified or intends to qualify under Subchapter M of the
Internal Revenue Code (26 U.S.C. 851-856). The Fund has no special or unusual
tax aspects such as taxation resulting from foreign investment, or from states
as a personal holding company, or from any tax loss carryforward. Refer to page
13 of the Prospectus for a more complete discussion of Federal taxation of the
Fund.
Underwriters: None. Calculation of Performance Data: None.
============ ===============================
NOTICE 1: As a prospective investor or shareholder, you may be interested in
securing Part C of this filing, and you must receive Part A, the Prospectus, in
order to make an investment in the Fund. You may request copies of Parts A, B,
and C from the Fund's office at the address shown on the Cover of Part B.
NOTICE 2: The Fund's Management and Board of Directors encourages prospective
investors and shareholders to review the audited financial statements,
particularly the Schedule of Investments, to obtain a useful perspective about
securities owned by the Fund.
Financial Statements
- --------------------
The audited financial statements for the year ended December 31, 1995,
appear at pages 21-36 in this Part B. As a unit, these statements include: The
Report of Independent Public Accountants, the Schedule of Portfolio Investments,
the Statement of Assets and Liabilities, the Statement of Operations, Statements
of Changes in Net Assets, and Notes to Financial Statements.
The Price Make Up Sheet, Appendix B, continues as adjunct information in
sequence to Appendix A; then the financial statements follow as a unit to
complete this Part B.
Bridges Investment Fund, Inc. 20 April 29, 1996
Statement -- Part B
APPENDIX A(Specimen)
PRICE MAKE UP SHEET
December 31, 1995
-----------------
Journal Form,
Ledger Form, Actual Balance
Schedule, or or Market
Account Number Value Figures
- -------------- -------------
ACCOUNT (Cost Figures in Parentheses)
-------------------------------------
ASSETS
- ------
01a-DR-C Cash-Principal $ 93,257.12
------------
01b-DR-C Cash-Income 76,099.02
-------------
02a-LF51 Dividends Receivable 53,212.00
-------------
02b-LF52 Interest Receivable 77,323.73
-------------
04a-CRDJ Accts. Receivable-Subscriptions to Capital 150,848.00
-------------
Stock
04b-CRDJ Accts. Receivable-Securities Sold 40,465.00
------------
07 -Schedule 7 Inv. in Securities (16,983,420.38) 23,820,268.52
-------------
CRS
- -------------- ------------------------------------------- ============
TOTAL ASSETS $24,311,473.39
--------------
LIABILITIES:
- ------------
13a-CRDJ Accts. Pay.-Redemptions of Capital Stock
--------------
13b-CRDJ Accts. Pay.-Purchase of Securities 43,376.00
--------------
14a-CRDJ Accrued Liab.-Operating Expenses 47,858.75
--------------
14b-CRDJ Accrued Liab.-Taxes
--------------
14 -CRDJ Distributions Payable $167,492.91
-=============
- -------------- ------------------------------------------- ============
TOTAL LIABILITIES $258,727.66
--------------
19 NET ASSETS APPLICABLE TO OUTSTANDING
CAPITAL SHARES (Tot. Assets Minus Tot. Liab.)$24,052,745.73
-------------
20 -CRDJ DR-TA Capital Stock-Total Shares Outstanding 1,116,619.619
NET ASSET VALUE PER SHARE
Purchase Price Per Share $21.54 21.54
-----
Redemption Price Per Share $21.54 x Div. @ .15
Equalization Computation Net Investment Income 0.00
------------
(Current Qtr.) (Current Qtr.)
Dividend Income $ 97,081.69 Undistributed Net Income 0.00
------------
Interest Income 108,495.04 (Previous Qtrs.)
Total Income 205,576.73 Total Acct. 21b 0.00
------------
Equalization/Share .003761
----------------
Taxes Paid $ Orders /
---------- --------------------------
Expenses Unpaid $ 50,600.00 Net Shares Purch., Redemp. , , .
----------
Reimbursed Expenses ( ) Balance, Equalization 4,199.52
--------- ------------
Tot.Exp.Post Close Equalization Entry
---------- ------------
Equalization Forward
--------------
Net Investment Inc.$154,976.73 Capital Shares Forward 1,116,619.619
----------
Bridges Investment Fund, Inc. 21 April 29, 1996
Statement -- Part B
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and the Shareholders of
Bridges Investment Fund, Inc.:
We have audited the accompanying statement of assets and liabilities of Bridges
Investment Fund, Inc. (a Nebraska corporation), including the schedule of
portfolio investments, as of December 31, 1995, and the related statement of
operations for the year then ended, the statement of changes in net assets for
each of the two years in the period then ended, and financial highlights for
each of the five years in the period then ended. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Bridges Investment Fund, Inc. as of December 31, 1995, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the five years in the period then ended in conformity with generally accepted
accounting principles.
ARTHUR ANDERSEN LLP
Omaha, Nebraska,
Bridges Investment Fund, Inc. 22 April 29, 1996
Statement -- Part B
<TABLE>
BRIDGES INVESTMENT FUND, INC.
-----------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS
---------------------------------
DECEMBER 31, 1995
-----------------
<CAPTION>
Number Market
Title of Security of Shares Value
- --------------------------------------- --------- ------------
(Note 1)
<S> <C> <C>
COMMON STOCKS (70.7%)
Aircraft - Manufacturing (2.0%) -
- ---------------------------------
The Boeing Co. 6,000 $ 470,250
-----------
Amusements - Recreation - Sporting Goods (0.6%)
- -----------------------------------------------
NIKE, Inc. 2,000 $ 139,250
-----------
Banking and Finance (5.7%) -
- ----------------------------
First National of Nebraska, Inc. 220 $ 803,000
NationsBank Corporation 3,000 208,875
Norwest Corporation 5,486 181,038
State Street Boston Corp. 4,000 180,000
-----------
$ 1,372,913
-----------
Beverages - Soft Drinks (2.8%) -
- --------------------------------
PepsiCo, Inc. 12,000 $ 670,500
-----------
Building Materials - Forest Products (0.9%) -
- -------------------------------------------
Georgia Pacific Corp. 3,000 $ 205,875
-----------
Chemicals (7.7%) -
- ------------------
The Dow Chemical Company 7,000 $ 491,750
Du Pont (E.I.) De Nemours & Company 4,000 279,500
Eastman Kodak Company 7,000 469,000
Monsanto Company 3,500 428,750
Morton International, Inc. 5,000 179,375
-----------
$ 1,848,375
-----------
Computers - Hardware and Software (3.9%) -
- ------------------------------------------
Hewlett-Packard Co. 6,000 $ 502,500
International Business Machines Corporation 1,000 91,375
Microsoft Corporation*<F5> 4,000 351,000
-----------
$ 944,875
-----------
Drugs - Medicines - Cosmetics (7.5%) -
- --------------------------------------
Abbott Laboratories 8,000 $ 333,000
Bristol-Myers Squibb Co. 3,000 257,625
Elan Corporation PLC ADR*<F5> 2,000 97,250
Johnson & Johnson 5,000 427,500
Merck & Co., Inc. 10,000 656,250
Perrico Company*<F5> 3,000 35,625
-----------
$ 1,807,250
-----------
Electrical Equipment and Supplies (1.8%) -
- ------------------------------------------
General Electric Co. 6,000 $ 432,000
-----------
Bridges Investment Fund, Inc. -23- April 29, 1996
Statement -- Part B
Number of Market
Title of Security Shares Value
- -------------------- ------------ -------
(Note 1)
COMMON STOCKS (Continued)
Electronics (2.8%) -
- --------------------
Intel Corporation 4,000 $ 227,000
Motorola, Inc. 8,000 456,000
-----------
$ 683,000
-----------
Finance - Real Estate (2.1%) -
- ------------------------------
Federal Home Loan Mortgage Corporation 6,000 $ 501,000
-----------
Food - Miscellaneous Products (3.7%) -
- --------------------------------------
Philip Morris Companies, Inc. 10,000 $ 902,500
-----------
Forest Products & Paper (1.0%)
- ------------------------------
Kimberly-Clark Corporation 3,000 $ 248,250
-----------
Insurance - Property, Casulaty,
- -------------------------------
& Reinsurance (1.3%) -
- ----------------------
General Re Corp. 2,000 $ 310,000
-----------
Insurance - Municipal Bond (0.9%) -
- -----------------------------------
MBIA, Inc. 3,000 $ 225,000
-----------
Lumber and Wood Products (0.9%) -
- ---------------------------------
Weyerhaeuser Company 5,000 $ 216,250
-----------
Machinery - Construction & Mining (0.5%) -
- ------------------------------------------
Caterpillar, Inc. 2,000 $ 117,500
-----------
Metal Products - Miscellaneous (1.1%) -
- ---------------------------------------
Nucor Corporation 4,500 $ 257,062
-----------
Motion Pictures and Theatres (1.7%) -
- -------------------------------------
Walt Disney Co. 7,000 $ 412,125
-----------
Petroleum Producing (6.9%) -
- ----------------------------
Amoco Corporation 5,000 $ 357,500
Atlantic Richfield Company 2,000 221,500
Chevron Corporation 10,000 523,750
Exxon Corporation 4,000 324,500
Mobil Corporation 2,000 223,500
-----------
$ 1,650,750
-----------
Printing and Engraving (0.6%) -
- -------------------------------
Deluxe Corp. 5,000 $ 145,000
-----------
Bridges Investment Fund, Inc. -24- April 29, 1996
Statement -- Part B
Number of Market
Title of Security Shares Value
- --------------------- ---------- -------
(Note 1)
COMMON STOCKS (Continued)
Publishing - Newspapers (1.0%) -
- --------------------------------
Gannett Co., Inc. 4,000 $ 245,500
-----------
Publishing - Electronic (1.4%) -
- --------------------------------
Reuters Holdings PLC 6,000 $ 330,750
-----------
Restaurants - Food Service (0.5%) -
- -----------------------------------
Apple South, Inc. 3,500 $ 75,250
Brinker International, Inc.*<F5> 3,000 45,375
-----------
$ 120,625
-----------
Retail Stores - Apparel and Clothing (1.2%) -
- ---------------------------------------------
Gap, Inc. 7,000 $ 294,000
-----------
Retail Stores - Department (2.0%) -
- -----------------------------------
Dayton Hudson Corporation 3,500 $ 262,500
Wal-Mart Stores, Inc. 10,000 222,500
-----------
$ 485,000
-----------
Retail Stores - Variety (0.7%) -
- --------------------------------
Albertson's Inc. 5,000 $ 164,375
-----------
Telecommunications (4.7%) -
- ---------------------------
A T & T Corp. 5,000 $ 323,750
GTE Corporation 10,000 438,750
Sprint Corporation 8,000 317,000
Telephonos de Mexico SA CL L ADR 1,500 47,813
-----------
(One ADR represents 20 Series L shares)
$ 1,127,313
-----------
Tobacco (0.0%) -
- ----------------
Schweitzer-Mauduit International, Inc. 300 $ 6,938
-----------
Transportation - Railroads (2.1%) -
- -----------------------------------
Burlington Northern Santa Fe 3,191 $ 248,898
Union Pacific Corporation 4,000 264,000
-----------
$ 512,898
-----------
Waste Management (0.7%) -
- -------------------------
WMX Technologies, Inc. 5,500 $ 163,625
-----------
TOTAL COMMON STOCKS (Cost - $10,527,101) $17,010,749
-----------
Bridges Investment Fund, Inc. -25- April 29, 1996
Statement -- Part B
Number of Market
Title of Security Shares Value
- --------------------- ---------- --------
(Note 1)
PREFERRED STOCKS (1.6%)
Automobiles (0.9%) -
- --------------------
General Motors Corp. $3.25 Series C
Convertible Preferred 3,000
$ 219,750
-----------
Transportation - Aircraft (0.7%) -
- ----------------------------------
Delta Air Lines $3.50 Series C
Convertible Preferred 3,000
$ 178,125
-----------
TOTAL PREFERRED STOCKS (Cost - $322,355) $ 397,875
-----------
TOTAL STOCKS (Cost - $10,849,456) $17,408,624
-----------
<CAPTION>
Principal Market
Title of Security Amount Value
- --------------------------------------------- -------- ------------
<S> <C> <C>
DEBT SECURITIES (26.7%)
Electric Utilities (0.7%) -
- ---------------------------
Southern California Edison Company, 8.625%
First and Refunding Mortgage Series 86C,
due April 15, 2019 $150,000
$ 158,531
-----------
Entertainment (0.3%) -
- ----------------------
Time Warner, Inc. Convertible Subordinated
Debentures 8.75% due April 1, 2015 $ 78,100
$ 80,931
-----------
Food - Miscellaneous Products (0.5%) -
- --------------------------------------
Super Valu Stores, Inc. 8.875%
Promissory Notes, due June 15, 1999 $100,000
$ 107,938
------------
Bridges Investment Fund, Inc. -26- April 29, 1996
Statement -- Part B
Principal Market
Title of Security Amount Value
- -------------------- ---------- -------
(Note 1)
U.S. Government (13.1%) -
- -------------------------
U.S. Treasury, 9.375% Notes,
due April 15, 1996 $200,000 $ 202,375
U.S. Treasury, 8.875% Notes,
due November 15, 1997 200,000 212,813
U.S. Treasury, 9.000% Notes,
due May 15, 1998 200,000 216,563
U.S. Treasury, 9.125% Notes,
due May 15, 1999 200,000 223,187
U.S. Treasury, 8.750% Notes,
due August 15, 2000 200,000 227,125
U.S. Treasury, 8.000% Notes,
due May 15, 2001 200,000 223,750
U.S. Treasury, 7.875% Notes,
due August 15, 2001 200,000 223,375
U.S. Treasury, 7.500% Notes,
due May 15, 2002 200,000 221,875
U.S. Treasury, 10.750% Bonds
due February 15, 2003 200,000 260,750
U.S. Treasury, 7.250% Notes,
due May 15, 2004 200,000 222,000
U.S. Treasury, 7.50% Notes,
due February 15, 2005 200,000 226,750
U.S. Treasury, 7.625% Bonds,
due February 15, 2007 200,000 219,875
U.S. Treasury, 9.125% Bonds,
due May 15, 2009 200,000 244,625
U.S. Treasury, 7.500% Bonds,
due November 15, 2016 200,000
234,312
-----------
$ 3,159,375
-----------
Bridges Investment Fund, Inc. -27- April 29, 1996
Statement -- Part B
Principal Market
Title of Security Amount Value
- -------------------- ---------- -------
DEBT SECURITIES (Continued)
Household Appliances and Utensils (0.5%) -
- ------------------------------------------
Maytag Corp., 9.75% Notes,
due May 15, 2002 $100,000
$ 118,243
-----------
Office Equipment and Supplies (0.5%) -
- --------------------------------------
Xerox Corporation, 9.750%
Notes, due March 15, 2000 $100,000
$ 114,406
-----------
Retail Stores - Broad Line Chains (0.6%) -
- ------------------------------------------
Costco Wholesale Corporation 5.750%
Convertible Subordinated Debentures,
due May 15, 2002 $150,000
$ 141,750
-----------
Retail Stores - Department (1.2%) -
- -----------------------------------
Dillard Department Stores, Inc. 7.850%
Debentures, due October 1, 2012 $150,000 $ 169,398
Sears Reobuck & Co.
9.375% Debentures, due
November 1, 2011 100,000
125,042
-----------
$ 294,440
-----------
Textiles - Miscellaneous (0.4%) -
- ---------------------------------
Guilford Mills, Inc. 6.000%
Convertible Subordinated Debentures
due September 15, 2012 $100,000
$ 94,500
-----------
Transportation - Railroads (0.6%) -
- -----------------------------------
Union Pacific Corporation 6.00%
Notes, due September 1, 2003 $150,000
$ 146,906
-----------
Waste Management (0.6%) -
- -------------------------
Browning Ferris Industries, Inc.
Convertible Subordinated Debentures
6.250% due August 15, 2012 $150,000
$ 149,625
-----------
Brisges Investment Fund, Inc. -28- April 29, 1996
Statement -- Part B
Principal Market
Title of Security Amount Value
- -------------------- ---------- -------
(Note 1)
DEBT SECURITIES (Continued)
Commerical Paper - Short Term (7.7%) -
- --------------------------------------
Ford Motor Credit Corp.
Commercial Paper Note 5.800%
due January 2, 1996 $1,000,000 $ 1,000,000
Prudential Funding Corp.
Commercial Paper Note 5.500%
due January 2, 1996 $ 845,000
$ 845,000
-----------
$ 1,845,000
-----------
TOTAL DEBT SECURITIES (Cost - $6,133,965) $ 6,411,645
-----------
TOTAL INVESTMENTS IN SECURITIES
(Cost - $16,983,421) (99.0%) $23,820,269
CASH AND RECEIVABLES
LESS TOTAL LIABILITIES (1.0%)
232,477
-----------
NET ASSETS, December 31, 1995 (100.0%) $24,052,746
===========
*<F5> Nonincome-producing security
<FN>The accompanying notes to financial statements
are an integral part of this schedule.
Bridges Investment Fund, Inc. -29- April 29, 1996
Statement -- Part B
</TABLE>
<TABLE>
BRIDGES INVESTMENT FUND, INC.
-----------------------------
STATEMENT OF ASSETS AND LIABILITIES
-----------------------------------
DECEMBER 31, 1995
-----------------
<CAPTION>
Amount
-------
<S> <C>
ASSETS
Investments, at market value (Note 1)
Common and preferred stocks (cost $10,849,456) $17,408,624
Debt securities (cost $6,133,965) 6,411,645
----------
Total Investments $23,820,269
Cash 169,356
Receivables
Dividends and interest 130,536
Subscriptions to capital stock 150,848
Securities sold 40,465
-----------
TOTAL ASSETS $24,311,474
===========
LIABILITIES
Accounts payable - purchase of securities $ 43,376
Dividend distributions payable (Notes 1 and 7) 167,493
Accrued operating expenses 47,859
-----------
TOTAL LIABILITIES $ 258,728
-----------
NET ASSETS
Capital stock, $1 par value - Authorized 3,000,000 shares,
less 637,617 shares redeemed; 1,754,237 shares issued;
1,116,620 shares outstanding (Note 6) $ 1,116,620
Paid-in surplus -
Excess over par value of amounts received from sale
of 1,754,237 shares, less amounts paid out in redeeming
637,617 shares (Note 6) 16,104,141
----------
Net capital paid in on shares $17,220,761
Accumulated net realized loss on investment
transactions (9,062)
Net unrealized appreciation on investments
(Note 1) 6,836,848
Accumulated undistributed net investment income (Note 1) 4,199
-----------
TOTAL NET ASSETS $24,052,746
===========
NET ASSET VALUE PER SHARE (Note 5) $21.54
======
OFFERING PRICE PER SHARE (Note 5) $21.54
======
REDEMPTION PRICE PER SHARE (Note 5) $21.54
======
<FN>The accompanying notes to financial statements
are an integral part of this statement.
Bridges Investment Fund, Inc. -30- April 29, 1996
Statement -- Part B
</TABLE>
<TABLE>
BRIDGES INVESTMENT FUND, INC.
-----------------------------
STATEMENT OF OPERATIONS
-----------------------
FOR THE YEAR ENDED DECEMBER 31, 1995
------------------------------------
<CAPTION>
Amount Amount
------- -------
<S> <C> <C>
INVESTMENT INCOME (Note 1)
Interest $428,822
Dividends 384,682
-------
Total Investment Income $813,504
EXPENSES
Management fees (Note 2) $107,149
Custodian fees 28,487
Professional services 10,525
Insurance 9,395
Bookkeeping services 9,368
Printing and supplies 9,345
Dividend disbursing and transfer
agent fees (Note 3) 7,787
Computer programming 7,306
Taxes and licenses 1,065
Foreign taxes paid on dividends 903
--------
Total Expenses $ 191,330
---------
NET INVESTMENT INCOME $ 622,174
---------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS, NET (Note 1)
Net realized gain on transactions in
investment securities $ 243,759
Net increase in unrealized
appreciation of investments 4,750,041
---------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS $4,993,800
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $5,615,974
==========
<FN>The accompanying notes to financial statements
are an integral part of this statement.
Bridges Investment Fund, Inc. -31- April 29, 1996
Statement -- Part B
</TABLE>
<TABLE>
BRIDGES INVESTMENT FUND, INC.
-----------------------------
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1995 AND 1994
---------------------------------------------
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
INCREASE IN NET ASSETS
Operations -
Net investment income $ 622,174 $ 611,464
Net realized gain on transactions in
investment securities (Note 1) 243,759 151,482
Net increase (decrease) in unrealized
appreciation of investments (Note 1) 4,750,041 (697,147)
----------- ---------
Net increase in net assets
resulting from operations $ 5,615,974 $ 65,799
Net equalization credits (Note 1) 1,028 3,270
Distributions to shareholders from -
Net investment income (Note 7) (622,174) (611,464)
Net realized gain from investment
transactions (211,269) (188,120)
Equalization (Note 1) (64) (1,726)
Net capital share transactions
(Note 6) 1,172,954 837,982
------------ ---------
Total Increase in Net Assets $ 5,956,449 $ 105,741
NET ASSETS:
Beginning of year 18,096,297 17,990,556
---------- ----------
End of year (including accumulated
undistributed net investment income
of $4,199 and $3,235, respectively) $24,052,746 $18,096,297
=======================
<FN>The accompanying notes to financial statements
are an integral part of these statements.
Bridges Investment Fund, Inc. -32- April 29, 1996
Statement -- Part B
</TABLE>
BRIDGES INVESTMENT FUND, INC.
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
DECEMBER 31, 1995
-----------------
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
Bridges Investment Fund, Inc. (Fund) is registered under the
Investment Company Act of 1940 as a diversified, open-end management
investment company. The primary investment objective of the Fund is long
term capital appreciation. In pursuit of that objective, the Fund invests
primarily in common stocks. The following is a summary of significant
accounting policies consistently followed by the Fund in the preparation of
its financial statements. The policies are in conformity with generally
accepted accounting principles.
A. Investments -
-----------
Security transactions are recorded on the trade date at purchase
cost or sales proceeds. Dividend income is recognized on the ex-
dividend date, and interest income is recognized on an accrual basis.
Securities owned are reflected in the accompanying statement of
assets and liabilities and the schedule of portfolio investments at
quoted market value. Quoted market value represents the last recorded
sales price on the last business day of the calendar year for
securities traded on a national securities exchange. If no sales were
reported on that day, quoted market value represents the closing bid
price. The cost of investments reflected in the statement of assets
and liabilities and the schedule of portfolio investments is the same
as the basis used for Federal income tax purposes. The difference
between cost and quoted market value of securities is reflected
separately as unrealized appreciation (depreciation) as applicable.
<TABLE>
<CAPTION>
1995 1994 Net Change
---- ---- ----------
<S> <C> <C> <C>
Net Unrealized appreciation (depreciation):
Aggregate gross unrealized appreciation on $7,035,300 $2,812,331
securities
Aggregate gross unrealized depreciation on (198,452) (725,524)
----------- -----------
securities
Net $6,836,848 $2,086,807 $4,750,041
========== ========== ==========
</TABLE>
The net realized gain (loss) from the sales of securities is
determined for income tax and accounting purposes on the basis of the cost
of specific securities.
Bridges Investment Fund, Inc. -33- April 29, 1996
Statement -- Part B
B. Federal Income Taxes -
--------------------
It is the Fund's policy to comply with the requirements of the
Internal Revenue Code of 1986, as amended, applicable to
regulated investment companies, including the distribution of
substantially all taxable income including net realized gains
on sales of investments. Therefore, no provision is made for
Federal income taxes.
C. Distribution To Shareholders -
----------------------------
The Fund accrues dividends to shareholders on the ex-dividend
date.
D. Equalization -
------------
The Fund uses the accounting practice of equalization by which a
portion of the proceeds from sales and costs of redemption of
capital shares, equivalent on a per share basis to the amount of
undistributed net investment income on the date of the
transactions, is credited or charged to undistributed income.
As a result, undistributed net investment income per share is
unaffected by sales or redemption of capital shares.
(2) INVESTMENT ADVISORY CONTRACT
----------------------------
Under an Investment Advisory Contract, Bridges Investment Counsel,
Inc. (Investment Adviser) furnishes investment advisory services and
performs certain administrative functions for the Fund. In return,
the Fund has agreed to pay the Investment Adviser a fee computed on a
quarterly basis at the rate of1/8 of 1% of the average net asset
value of the Fund during the quarter, equivalent to 1/2 of 1% per
annum. Certain officers and directors of the Fund are also officers
and directors of the Investment Adviser. These officers do not
receive any compensation from the Fund other than that which is
received indirectly through the Investment Adviser.
The contract between the Fund and the Investment Adviser provides that
total expenses of the Fund in any year, exclusive of stamp and other
taxes, but including fees paid to the Investment Adviser, shall not
exceed, in total, a maximum of 1 and 1/2% of the average month end
net asset value of the Fund for the year. Amounts, if any, expended
in excess of this limitation are reimbursed by the Investment Adviser
as specifically identified in the Investment Advisory Contract.
Bridges Investment Fund, Inc. -34- April 29, 1996
Statement -- Part B
(3) DIVIDEND DISBURSING AND TRANSFER AGENT
--------------------------------------
Effective October 1, 1987, dividend disbursing and transfer agent
services are provided by Bridges Investor Services, Inc. (Transfer
Agent). The fees paid to the Transfer Agent are intended to
approximate the cost to the Transfer Agent for providing such
services. Certain officers and directors of the Fund are also
officers and directors of the Transfer Agent.
(4) SECURITY TRANSACTIONS
---------------------
The cost of long term investment purchases during the years ended
December 31, was:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
United States government obligations $ 199,498 $ 198,495
Other Securities 1,181,022 1,698,536
--------- ---------
Total Cost $1,380,520 $1,897,031
========== ==========
</TABLE>
Net proceeds from sales of long term investments during the years
ended December 31, were:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
United States government obligations $ 200,000 $ 200,000
Other Securities 1,503,775 1,528,893
--------- ---------
Total Net Proceeds $1,703,775 $1,728,893
========== ==========
Total Cost Basis of
Securities Sold $1,460,016 $1,577,411
========== ==========
</TABLE>
(5) NET ASSET VALUE
---------------
The net asset value per share represents the effective price for all
subscriptions and redemptions.
Bridges Investment Fund, Inc. -35- April 29, 1996
Statement -- Part B
(6) CAPITAL STOCK
-------------
Shares of capital stock issued and redeemed are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Shares sold 83,027 52,107
Shares issued to shareholders in
reinvestment of net investment
income and realized gain from
security transactions 36,926 40,466
------ ------
119,953 92,573
Shares redeemed 61,760 44,838
------ ------
Net increase 58,193 47,735
====== ======
Value of capital stock issued and redeemed is as follows:
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Shares sold $1,627,894 $ 919,163
Shares issued to shareholders in
reinvestment of net investment
income and realized gain from
security transactions 725,065 708,904
---------- ----------
$2,352,959 $1,628,067
Shares redeemed 1,180,005 790,085
--------- ----------
Net increase $1,172,954 $ 837,982
========== ==========
</TABLE>
- --------
(7) DISTRIBUTION TO SHAREHOLDERS
----------------------------
On December 5, 1995 a cash distribution was declared from net
investment income accrued through December 31, 1995. This distribution
was ultimately calculated as $.15 per share aggregating $167,493. (This
dividend includes $65 that represents a return of capital distribution to
shareholders for Federal income tax purposes.) The dividend will be paid
on January 22, 1996, to shareholders of record on December 29, 1995.
(8) DERIVATIVE FINANCIAL INSTRUMENTS
--------------------------------
In October, 1994, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 119, Disclosure about
Derivative Financial Investments and Fair Value of Financial Instruments.
The Fund has not entered into any such investment or investment contracts.
A covered call option contract is a form of a financial derivative
instrument. The Fund's investment and policy restrictions do permit the
Fund to sell or write covered call option contracts under certain
circumstances and limitations as set forth in the Fund's prospectus.
Bridges Investment Fund, Inc. -36- April 29, 1996
Statement -- Part B
FINANCIAL HIGHLIGHTS*
- ---------------------
Per share income and capital changes for a share outstanding for
each of the last five years were:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $17.10 $17.80 $17.51 $17.30 $15.15
------ ------ ------ ------ ------
Income From Investment Operations
- ---------------------------------
Net Investment Income $ .58 $ .59 $ .61 $ .63 $ .66
Net Gains or (Losses) on Securities
(both realized and unrealized)
4.63 (.52) .46 .37 2.44
------ ------- ------ ------ ------
Total From Investment Operations $ 5.21 $ .07 $ 1.07 $ 1.00 $ 3.10
Less Distributions
- ------------------
Dividends from net investment income (.58) (.59) (.61) (.63) (.66)
Distributions from capital gains (.19) (.18) (.17) (.16) (.29)
------- ------- ------- ------- -------
Total Distributions $ (.77) $ (.77) $ (.78) $ (.79) $ (.95)
------- ------- ------- ------- -------
Net Asset Value, End of Period $21.54 $17.10 $17.80 $17.51 $17.30
====== ====== ====== ====== ======
Ratios/Supplemental Data
- ------------------------
Net Assets, End of Period
(in thousands)
$24,052 $18,096 $17,991 $17,007 $14,375
------- ------- ------- ------- -------
Ratio of Expenses to Average
Net Assets**<F6>
.89% .90% .90% .94% .98%
-------- -------- -------- -------- --------
Ratio of Net Income to
Average Net Assets **<F6>
3.80% 4.25% 4.32% 4.57% 4.91%
-------- -------- -------- -------- --------
Portfolio Turnover Rate 7% 10% 11% 7% 28%
-------- -------- -------- -------- --------
<FN> * Per share income and capital change data is computed using the weighted average
number of shares outstanding method.
<F6> ** Average net asset data is computed using monthly net asset value figures.
PART C
OTHER INFORMATION
OTHER INFORMATION Bridges Investment Fund, Inc. CAPITAL STOCK
April 29, 1996 8401 West Dodge Road
Omaha, Nebraska 68114
402-397-4700
Contents Page No.
Item 24. Financial Statements and Exhibits.........................2-7
Item 25. Persons Controlled by or Under Common Control..............7
Item 26. Number of Holders of Securities............................7
Item 27. Indemnification............................................7
Item 28. Business and Other Connections of Investment Adviser......8-10
Item 29. Principal Underwriters ....................................10
Item 30. Location of Accounts and Records...........................10
Item 31. Management Services........................................10
Item 32. Undertakings...............................................10
SIGNATURES 11
SUMMARY PROSPECTUS None
Bridges Investment Fund, Inc. 2 April 29, 1996
Other Information -- Part C
Special Notices
. This Other Information is not a Prospectus.
. This Other Information should be read in conjunction with Part A, the
Prospectus of Bridges Investment Fund, Inc. dated April 29, 1996, and
Part B, Statement of Additional Information.
. Copies of the Part A and Part B filings of Bridges Investment Fund, Inc.
may be obtained from the office of the Fund at the address shown above.
. The date of this Other Information is April 29, 1996.
Item 24. Financial Statements and Exhibits Page
--------------------------------- ----
(a) Financial Statements Part C
------
Consent of Independent Public Accountants 3
Part B
------
Report of Independent Public Accountants 21
Schedule of Portfolio Investments 22-28
Statement of Assets and Liabilities 29
Statement of Operations 30
Statements of Changes in Net Assets 31
Notes to Financial Statements 32-36
(Item 24 continues after the Consent of Independent Public
Accountants)
Bridges Investment Fund, Inc. 3 April 29, 1996
Other Information -- Part C
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
As independent public accountants, we hereby consent to the use of our
reports and to all references to our Firm included in or made a part of
this Registration Statement.
ARTHUR ANDERSEN LLP
Omaha, Nebraska,
February 20, 1996
Bridges Investment Fund, Inc. 4 April 29, 1996
Other Information -- Part C
Item 24. Financial Statements and Exhibits (continued)
---------------------------------------------
(b) Exhibits:
1.The Articles of Incorporation, filed with the Form N-8B-1 and
amendments thereto, in File No. 811-1209, are hereby incorporated
by reference.
2.The By-Laws, filed with the Form N-8B-1 and amendments thereto, in
File No. 811-1209, are hereby incorporated by reference.
3.Item 1 (b)(3) Not applicable
4.The Specimen Stock Certificate, filed with the Form S-5, in File
No. 2-21600, is hereby incorporated by reference.
5.The Investment Advisory Agreement and Amendatory Advisory Agreement
filed with Amendment No. 2 to the Form N-8B-1 in File No. 811-1209
are hereby incorporated by reference.
6.Item 1(b)(6) Not applicable
7.Item 1(b)(7) Not applicable
8.The Custodian Agreement and Amendatory Custodian Agreement filed
with Amendment No. 1 to the Form N-8B-1 in File No. 811-1209 are
hereby incorporated by reference.
9.Item 1(b)(9) Not applicable
10.The opinion and consent of counsel dated July 12, 1963, as to the
legality of securities issued, filed as Exhibit F of the original
Form S-5 in File No. 2-21600, are hereby incorporated by
reference.
11.Item 1(b)(11) Not applicable
12.Item 1(b)(12) Not applicable
Bridges Investment Fund, Inc. 5 April 29, 1996
Other Information -- Part C
13.Written Assurance, specimen copy, by initial investors in the Fund
is incorporated by reference to Post-Effective Amendment No. 21 to
File No. 2-21600 and Amendment No. 7 to File No. 811-1209.
14.Copies of the model plans used to establish retirement plans filed
March 25, 1985 are hereby incorporated by reference as follows:
a.Exhibit SE-1 filed with Post-Effective Amendment No. 1 to the
Form S-5, File No. 2-21600, is hereby incorporated by
Reference, including Amendments thereto with Post-Effective
Amendments No. 2, 3 and 13. These materials relate to the
Self-Employed Retirement Keogh Plans.
b.Amendment No. 5 to Exhibit SE-1, Second Amendment to Bridges
Investment Fund, Inc. Standard Profit Sharing and Retirement
Plan is hereby incorporated by reference.
c.Amendment No. 6 to Exhibit SE-1, Revised Bridges Investment
Fund, Inc. Standard Profit Sharing and Retirement Plan, is
hereby incorporated by reference.
d.Amendment No. 7 to Exhibit SE-1, Standard Self-Employed
Retirement Act Plan (as Amended and Restated as of January 1,
1982) is hereby incorporated by reference.
e.Exhibit IDA-1, Bridges Investment Fund, Inc. Individual
Retirement Act Custodian Agreement, is hereby incorporated by
reference.
f.Amendment No. 2 to Exhibit IDA-1, Individual Retirement Act
Custodial Agreement, as Amended and Restated effective the 1st
day of January, 1982, is hereby incorporated by reference.
g.Amended and Restated Standard Retirement Plan as of January 1,
1984, is hereby incorporated by reference.
h.Amendment No. 3 to Exhibit IDA-1, Individual Retirement Act
Custodial Agreement, as Amended and Restated effective January
1, 1985, is hereby incorporated by reference.
Bridges Investment Fund, Inc. 6 April 29, 1996
Other Information -- Part C
i.Amended and Restated Standard Retirement Plan, including
Application Forms, Participant Request For Distribution Forms,
and Designation of Beneficiary Forms, and the Standard
Custodial Agreement.
j.Amended and Restated Standard Retirement Plan as described in
(i) above, corrected to final text approval by the Internal
Revenue Service on July 31, 1990.
k.Amended and Restated Individual Retirement Account Custodial
Agreement as described in (h) above corrected to final text
approval by the Internal Revenue Service on June 11, 1993.
l.Amendment to Bridges Investment Fund, Inc. Standard Retirement
Plan effective January 1, 1994, as adopted on March 29, 1994.
15.Item 24(b)(15) Not applicable
16.Item 24(b)(16) Not applicable
17.Exhibit 17, Reference Item 24(b)(1) and Original Filing Exhibit 1,
Articles of Amendment to The Articles of Incorporation of Bridges
Investment Fund, Inc. hereby incorporated by reference.
18.Exhibit 18, Reference to Item 24(b)(8) and Original Filing Exhibit
5, Amendatory Agreement to Custodian Agreement dated October 13,
1987, is hereby incorporated by reference.
19.Exhibit 19, Reference to Item 24(b)(9)(i) Agreement dated July 14,
1987, to appoint Bridges Investor Services, Inc. as Dividend
Disbursing and Transfer Agent, is hereby incorporated by
reference.
20.Exhibit 20, Reference to Item 24(b)(a)(ii) Agreement dated October
13, 1987, to establish jointly insured status for Bridges
Investment Fund, Inc. and Bridges Investor Services, Inc. under
the Federal Insurance Company registered investment management
company bond, is hereby incorporated by reference.
Bridges Investment Fund, Inc. 7 April 29, 1996
Other Information -- Part C
21.Exhibit 21, Reference to Item 24(b)(9)(iii) Agreement dated
October 13, 1987, to establish jointly insured status under ICI
Mutual Insurance Company fidelity blanket bond between Bridges
Investment Fund, Inc.; Bridges Investor Services, Inc.; Bridges
Investment Counsel, Inc.; and Edson Bridges II Investment Counsel
in California, a proprietorship, is hereby incorporated by
reference.
22.Exhibit 22, Reference to Item 24(b)(10), and Original Filing
Exhibit F, the opinion and consent of legal counsel, February 25,
1988, as to the legality of securities issued, is hereby
incorporated by reference.
23.Exhibit 23-A, Stock Subscription and Order Form (Revision 02-24-
1989) to be used by new investors on effective date of this
filing.
24.Exhibit 24B, Stock Subscription and Order Form (Revision 02-26-
1990) to be used by investors on the effective date for this
filing.
25.Exhibit 25, Articles of Amendment To The Articles of Incorporation
of Bridges Investment Fund, Inc. Reference Item 24(b)(1) and
Original Filing of The Articles of Incorporation as Exhibit 1, the
terms of which and all other amendments are hereby incorporated by
reference.
Item 25. Persons Controlled by or under Common Control with Registrant
-------------------------------------------------------------
Not applicable
Item 26. Number of Holders of Securities
-------------------------------
(1) (2)
Number of Record
Title of Class Holders*
-------------- --------
Capital Stock 451
* Holders as of January 22, 1996 reinvestment date
Item 27. Indemnification
---------------
Not applicable
Bridges Investment Fund, Inc. 8 April 29, 1996
Other Information -- Part C
Item 28. Business and Other Connections of Investment Adviser
----------------------------------------------------
Edson L. Bridges II is the President and a Director of Bridges
Investment Counsel, Inc., as well as being the President and a
Director of Bridges Investment Fund, Inc. Mr. Bridges II is President
and a Director of Bridges Investor Services, Inc. Mr. Bridges II has
a principal profession in investment counselling. During the last two
fiscal years for the Fund, Mr. Bridges II acted for his own account in
the capacity of director, officer, employee, partner or trustee in the
following businesses or activities:
Name and Principal Position with
Business Address Business or Activity
- ---------------- --------------------
Edson L. Bridges II Proprietor
Investment Counsel in California
8401 West Dodge Road
Omaha, Nebraska 68114
N. P. Dodge Company Director
Real Estate Brokers and Management
8701 West Dodge Road
Omaha, Nebraska 68114
JAT Corporation Director
Sizzler Family Steak House
3815 Frederick Boulevard
St. Joseph, Missouri 64506
Provident Trust Company President and
256 Durham Plaza Director
8401 West Dodge Road
Omaha, Nebraska 68114
Store Kraft Manufacturing Company Director
Beatrice, Nebraska 68310
West Omaha Land & Cattle Company A Partner
8401 West Dodge Road
Omaha, Nebraska 68114
The question in this item uses the terms substantial nature in
requiring a response. None of the foregoing relationships are
substantial in terms of time commitment or compensation received as
they may require only several hours per month or per calendar quarter
Bridges Investment Fund, Inc. 9 April 29, 1996
Other Information -- Part C
of Mr. Bridges' time. One exception to this statement would be Edson
L. Bridges II, Investment Counsel in California, which is part of Mr.
Bridges' principal profession. The other exception would be Provident
Trust Company. Refer to page 10 for additional comments.
Mr. Bridges II acts as a Trustee or Co-Trustee, primarily for
revocable and testamentary trusts which have investment advisory
client relationships with either Bridges Investment Counsel, Inc. or
Investment Counsel in California.
Mr. Edson L. Bridges III is Executive Vice President-Investments of
Bridges Investment Counsel, Inc. and a Director of that Company. Mr.
Bridges III is Executive Vice President and Director of Bridges
Investment Fund, Inc. and Vice President and Director of Bridges
Investor Services, Inc. Mr. Bridges III has a principal profession of
investment counselling. During the last two fiscal years for the
Fund, Mr. Bridges III acted for his own account in the capacity of
director, officer, employee, partner, or trustee in the following
businesses or activities:
Name and Principal Position with
Business Address Business or Activity
- ---------------- --------------------
Provident Trust Company Vice President
256 Durham Plaza and Director
8401 West Dodge Road
Omaha, Nebraska 68114
Stratus Fund, Inc. Director
500 Centre Terrace
1225 ``'' Street
Lincoln, Nebraska 68508
Bridges Investment Fund, Inc. 10 April 29, 1996
Other Information -- Part C
Provident Trust Company was granted a charter by the State of Nebraska
Department of Banking on March 11, 1992. Trust business activities
commenced on March 14, 1992. Provident has a Management Agreement
with Bridges Investment Counsel, Inc. that was entered into on March
26, 1991. Mr. Bridges II and Mr. Bridges III were active during 1995
with assistance to Provident Trust Company for the conduct of its
operations and services. On December 31, 1995, Provident Trust
Company was responsible to 285 customer accounts with assets valued at
$157,763,000.
Item 29. Principal Underwriters
----------------------
Not applicable
Item 30. Location of Accounts and Records
--------------------------------
The principal records for the Fund to maintain under Rule 31a-3 of The
Investment Company Act of 1940 are maintained by the Fund and its
investment adviser at the offices of the Fund, Suite 256, Durham
Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114. The persons in
charge of the corporate records are Mrs. Mary Ann Mason, Secretary,
and Mrs. Nancy K. Dodge, Treasurer. Documents of original entry
regarding the safekeeping of securities, disbursing of dividends and
transfer agency work are maintained by Bridges Investor Services, Inc.
Item 31. Management Services
-------------------
Not applicable
Item 32. Undertakings
------------
Not applicable
Bridges Investment Fund, Inc. 11 April 29, 1996
Other Information -- Part C
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all the
requirements for effectiveness of this Registration Statement pursuant to Rule
485a under the Securities Act of 1933, and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Omaha, and State of Nebraska, on the 27th day of
February, 1996.
BRIDGES INVESTMENT FUND, INC.
-----------------------------
BY /s/ Edson L. Bridges II
--------------------------
Edson L. Bridges II, 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:
/s/ Edson L. Bridges II President February 27, 1996
- ----------------------- -----------------
Edson L. Bridges II Date
/s/ Nancy K. Dodge Treasurer February 27, 1996
- ------------------ -----------------
Nancy K. Dodge Date
Director
- ------------------- -----------------
Frederick N. Backer Date
/s/ Edson L. Bridges II Director February 27, 1996
- ----------------------- -----------------
Edson L. Bridges II Date
/s/ Edson L. Bridges III Director February 27, 1996
- ------------------------ -----------------
Edson L. Bridges III Date
/s/ N. P. Dodge, Jr. Director February 27, 1996
- -------------------- -----------------
N. P. Dodge, Jr. Date
/s/ John W. Estabrook Director February 27, 1996
- --------------------- -----------------
John W. Estabrook Date
Director
- ----------------- -----------------
Jon D. Hoffmaster Date
Bridges Investment Fund, Inc. 12 April 29, 1996
Other Information -- Part C
/s/ John J. Koraleski Director February 27, 1996
- --------------------- -----------------
John J. Koraleski Date
Director
- -------------- -----------------
Roger A. Kupka Date
/s/ Gary L. Petersen Director February 27, 1996
- -------------------- -----------------
Gary L. Petersen Date
/s/ Roy A. Smith Director February 27, 1996
- ---------------- -----------------
Roy A. Smith Date
/s/ L.B. Thomas Director February 27, 1996
- --------------- -----------------
L.B. Thomas Date
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the
Thirty-Third Annual Shareholder Report 1995 and is qualified in its entirety by
reference to such report.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 16,983,421
<INVESTMENTS-AT-VALUE> 23,820,269
<RECEIVABLES> 321,849
<ASSETS-OTHER> 169,356
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 24,311,474
<PAYABLE-FOR-SECURITIES> 43,376
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 215,352
<TOTAL-LIABILITIES> 258,728
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,220,761
<SHARES-COMMON-STOCK> 1,116,620
<SHARES-COMMON-PRIOR> 1,058,427
<ACCUMULATED-NII-CURRENT> 4,199
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (9,062)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,836,848
<NET-ASSETS> 24,052,746
<DIVIDEND-INCOME> 384,682
<INTEREST-INCOME> 428,822
<OTHER-INCOME> 0
<EXPENSES-NET> 191,330
<NET-INVESTMENT-INCOME> 622,174
<REALIZED-GAINS-CURRENT> 243,759
<APPREC-INCREASE-CURRENT> 4,750,041
<NET-CHANGE-FROM-OPS> 5,615,974
<EQUALIZATION> 1,028
<DISTRIBUTIONS-OF-INCOME> 622,174
<DISTRIBUTIONS-OF-GAINS> 211,269
<DISTRIBUTIONS-OTHER> 64
<NUMBER-OF-SHARES-SOLD> 119,953
<NUMBER-OF-SHARES-REDEEMED> 61,760
<SHARES-REINVESTED> 36,926
<NET-CHANGE-IN-ASSETS> 5,956,449
<ACCUMULATED-NII-PRIOR> 3,235
<ACCUMULATED-GAINS-PRIOR> (41,552)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 107,149
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 191,330
<AVERAGE-NET-ASSETS> 21,429,860
<PER-SHARE-NAV-BEGIN> 17.10
<PER-SHARE-NII> 0.58
<PER-SHARE-GAIN-APPREC> 4.63
<PER-SHARE-DIVIDEND> 0.58
<PER-SHARE-DISTRIBUTIONS> 0.77
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 21.54
<EXPENSE-RATIO> 0.89
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
