SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [x]
Pre-Effective Amendment No. ___ [ ]
Post-Effective Amendment No. 44 [x]
File No. 2-21600
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 30 [x]
File No. 811-1209
BRIDGES INVESTMENT FUND, INC.
(Exact Name of Registrant as Specified in Charter)
256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code 402-397-4700
Edson L. Bridges II, 256 Durham Plaza, 8401 West Dodge Road, Omaha, NE 68114
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering N/A
It is proposed that this filing will become effective (check
appropriate box)
[x] immediately upon filing pursuant to paragraph (b)
[ ] on (date) pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Title of Securities Being Registered: CAPITAL STOCK
<PAGE>
PART B
INFORMATION REQUIRED IN A STATEMENT
OF ADDITIONAL INFORMATION
__________________________________________________________________________
September 25, 2000 Bridges Investment Fund, Inc.
CAPITAL STOCK
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 February 25,
2000.
. Other Information, Part C, of the filing dated September 25, 2000, 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
September 25, 2000.
Bridges Investment Fund, Inc. 2 September 25, 2000
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 Additional Information Part B
- Cover Page...........................................1
- Table of Contents....................................2
- Fund History.........................................3
9 Description of the Fund and its Investments and Risks.3-6
9 Investment Policies, Strategies and Risks.........3
- Fund Policy Restrictions..........................3-5
- Portfolio Turnover................................5-6
11 Management of the Fund................................6
- Directors and Officers............................6-11
- Code of Ethics....................................12
- Compensation.........................................13-14
- Control Persons and Principal Holders of Securities...14-15
11-12 Investment Advisory and Other Services................15-18
- Control Persons...................................15-16
- Affiliated Persons................................16
12 Advisory Fees.....................................16
- Expense Limitation................................16
- Services Performed on Behalf of Fund..............16-17
Supplied or Paid for Substantially by
Investment Adviser
- Other Services....................................17
Independent Auditors...............................17-18
- Brokerage Allocation and Other Practices..............18-19
Investment Adviser's Trade Aggregation Policy.........19-20
13 Capital Stock and Other Securities....................20
Cumulative Voting.................................20
13-18 Purchase, Redemption, and Pricing of Securities.......20-21
Being Offered
- General Information............................20-21
14 Valuation......................................21
Specimen Price Make Up Sheet...................21
- Other Disclosures..............................21
Description of Fund Plans.............................21-25
Standard Retirement Plan..........................21-22
- Individual Retirement Custodian Account Prototype.22-25
19 Tax Status.............................................26
- Underwriters...........................................26
- Calculation of Performance Data.......................26-29
- Financial Statements..................................30-47
Report of the Independent Public Accountants.......32
Schedule of Portfolio Investments.................33-39
Statement of Assets and Liabilities................40
Statement of Operations............................41
Statements of Changes in Net Assets................42
Notes to Financial Statements.....................43-47
<PAGE>
Bridges Investment Fund, Inc. 3 September 25, 2000
Statement -- Part B
Fund History
The Fund was organized as an open-end investment company under the laws of
Nebraska on March 20, 1963. The Fund commenced investment operations on July 1,
1963, and shares of Capital Stock were first sold to the general public on
December 7, 1963. The Fund has conducted its business continuously since such
time.
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 too small to permit economical administration as
separate accounts. By acquiring shares of the Fund, investors with smaller
accounts obtain securities diversification and continuous investment
supervision, although an investment in the Fund does not remove the market risk
inherently involved in making securities investments.
Description of the Fund and Its Investments and Risks
Investment Policies, Strategies and Risks -- The primary investment
objective of the Fund is long-term capital appreciation. The development of a
moderate amount of current income is a secondary investment objective of the
Fund. The Fund will invest in common stocks and securities convertible into
common stocks to achieve its capital growth objective, bonds, debentures, and
preferred stocks to meet its income objective. Refer to the Fund Prospectus for
a complete discussion of the investment policy objectives for the Fund and the
strategies employed to attain the Fund's objectives.
Fund Policy Restrictions -- The activities of the Fund and its investment
policies are restricted as set forth in the Fund's Prospectus and in the
following discussion. The restrictions described below 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.
Bridges Investment Fund, Inc. 4 September 25, 2000
Statement -- Part B
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 Fund has never exercised the option to borrow
money as a temporary measure. 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
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 by the Fund are not permitted if immediately
after such purchase or acquisition:
1. The Fund owns in the aggregate more than 3% of the outstanding voting
stock of another investment company;
2. The shares of the other registered investment company have an
aggregate value in excess of 5% of the value of the total assets of
the Fund; or
3. The shares of the other registered investment company and all other
investment companies have an aggregate value in excess of 10% 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.
Bridges Investment Fund, Inc. 5 September 25, 2000
Statement -- Part B
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,
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. As of December
31, 1999, the Fund has 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 U.S. Treasury that are backed by the full
faith and credit of the United States of America. The Fund may purchase U.S.
Treasury Bills, short term; U.S. Treasury Notes, intermediate term; and U.S.
Treasury 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, 1999, the
portfolio turnover rate for the Fund ranged from a high of 28% in 1991 to a low
of 7% in 1992 and 1995. The median portfolio turnover for the past 10 years was
10.5% and the average portfolio turnover rate for such period was 14.5%. The
portfolio turnover rate in 1999 was 16% while in 1998 was 24%. The Fund does
not plan to materially change its portfolio turnover rate more than the ranges
experienced in the past ten years; however, portfolio rates could increase
significantly in order to respond to turbulent conditions in the securities
market. Refer to Financial Highlights in the Prospectus for detailed year-to-
year information on the portfolio turnover rate.
Bridges Investment Fund, Inc. 6 September 25, 2000
Statement -- Part B
The rate of portfolio turnover is calculated by dividing (a) the lesser of
purchases or sales of portfolio securities for the reporting period by (b) the
monthly average of the value of the portfolio securities owned by the Fund
during the reporting period. Such monthly average is 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 calculation, there is 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, are included.
Purchases include any cash paid upon the conversion of one portfolio security
into another. Purchases also include the cost of rights or warrants purchased.
Sales include the net proceeds from the sale of rights or warrants and the net
proceeds of portfolio securities which have been called or for which payment has
been made through redemption or maturity.
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 described below. Directors who
are "interested persons" of the Fund are indicated with an asterisk (*) in front
of their name. The determination of an interested person is based on the
definition in Section 2(a)(19) of the Investment Company Act of 1940, and the
recent Securities and Exchange Commission Release (Release No. IC-24083, dated
October 14, 1999), providing additional guidance to investment companies about
the types of professional and business relationships that may be considered to
be material for purposes of Section 2(a)(19). Interested persons include a
director or officer of the Fund who has a significant or material business or
professional relationship with the Fund's investment adviser, Bridges Investment
Counsel, Inc.
Frederick N. Backer, Age 67, Director of the Fund and member of the Audit
Committee, 25720 West Dodge Road, Waterloo, Nebraska. Mr. Backer is currently
Bridges Investment Fund, Inc. 7 September 25, 2000
Statement -- Part B
the President of JAT Investments Limited, formerly JAT Corp., a private
investment concern that operated a restaurant for twenty-five years. His
responsibilities as President of JAT Corp. commenced in August, 1972.
*Edson L. Bridges II, CFA, Age 67, Chairman and Chief Executive Officer,
Director of the Fund, and member of the Executive Committee, 8401 West Dodge
Road, Omaha, Nebraska. Mr. Bridges became Chairman and Chief Executive Officer
of Bridges Investment Fund, Inc. on April 11, 1997, after serving as President
from September 28, 1970 through April 11, 1997. In September, 1959, Mr. Bridges
became associated with the predecessor firm to Bridges Investment Counsel, Inc.
and is presently the President and Director of that Corporation. Mr. Bridges is
also President and Director of Bridges Investor Services, Inc., a company that
became Transfer Agent and Dividend Disbursing Agent effective October 1, 1987.
Mr. Bridges is also President and Director of Provident Trust Company, chartered
to conduct business on March 11, 1992. Mr. Bridges is also Managing Director of
Bridges Investment Management, Inc.
*Edson L. Bridges III, CFA, Age 41, President and Director of the Fund and
member of the Planning Committee, 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. Mr. Bridges has been responsible
for securities research and the investment management for an expanding base of
discretionary management accounts, including the Fund, for more than seven
years. Mr. Bridges was elected President of Bridges Investment Fund, Inc. on
April 11, 1997, and he assumed the position of Portfolio Manager at the close of
business on that date. Mr. Bridges became a Director of Stratus Fund, Inc. in
October, 1990. Stratus Fund, Inc. is an open-end, regulated investment company
located in Lincoln, Nebraska. Mr. Bridges has been Executive Vice President-
Investments of Bridges Investment Counsel, Inc. since February, 1993, and he is
a Director of that Firm. Mr. Bridges is also an officer and a Director of
Bridges Investor Services, Inc., Provident Trust Company and President of
Bridges Investment Management, Inc.
N. Phillips Dodge, Jr., Age 63, Director of the Fund and member of the
Executive Committee, 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, and real estate syndication. Mr. Dodge became a Director
of American States Water Company (formerly Southern California Water Company) in
April, 1990, and a Director of the Omaha Public Power District as of January 5,
1995, for a six year term.
John W. Estabrook, Age 72, Director of the Fund and member of the Audit
Committee, 10542 Mullen Road, Omaha, Nebraska. Mr. Estabrook was the Chief
Administrative Officer of the Nebraska Methodist Hospital and its holding
Bridges Investment Fund, Inc. 8 September 25, 2000
Statement -- Part B
company, Nebraska Methodist Health System, in Omaha, Nebraska, beginning June,
1959. Effective January 1, 1987, Mr. Estabrook relinquished the position of
President of Nebraska Methodist Hospital, assuming the Presidency of the
Nebraska Methodist Health System until his retirement on August 31, 1992.
Jon D. Hoffmaster, Age 52, Director of the Fund and member of the Planning
Committee, 8905 Farnam Court, Omaha, Nebraska. Since July 1999, Mr. Hoffmaster
has been affiliated with eteetime.com, a golf software, reservation and e-
commerce business located in La Quinta, California, and currently serves as
Chief Executive Officer and a director of eteetime.com. From 1987 until June
1999, Mr. Hoffmaster served as a director of infoUSA (formerly known as American
Business Information, Inc.), a leading business-to-business marketing
information company located in Omaha, Nebraska, and until June 1999 served as
its President and Chief Operating Officer. From 1980 to 1987, Mr. Hoffmaster
was President and Chief Executive Officer of First National Bank of Bellevue,
Nebraska.
John J. Koraleski, Age 49, Director of the Fund and member of the Planning
Committee, 1416 Dodge Street, Omaha, Nebraska. Mr. Koraleski is Executive Vice
President-Marketing & Sales of the Union Pacific Railroad Company headquartered
in Omaha, Nebraska. As the Executive Vice President, he has responsibility for
all sales, marketing, and commercial activities for the railroad and its Union
Pacific Distribution Services subsidiary. Prior to being promoted to his current
position in March 1999, Mr. Koraleski was the Railroad's Chief Financial
Officer, Controller of Union Pacific Corporation, and he also was responsible
for the Railroad's Real Estate Department. Mr. Koraleski is a member of the
Railroad's Operating Committee. He is Vice President-Finance and a member of the
Board of Trustees of the Union Pacific Foundation. Mr. Koraleski is also a
Board member of Automated Monitoring and Control International, Inc. (AMCI), a
wholly-owned technology firm situated in Omaha, Nebraska.
Roger A. Kupka, Age 69, Director of the Fund and member of the Audit
Committee, 2305 South 103rd Street, Omaha, Nebraska. Mr. Kupka was the President
and Chief Executive Officer of Nebraska Builders Products Co. of Omaha,
Nebraska. He held this position from 1969 until November, 1986, when he
retired. During the past five years, Mr. Kupka has been Vice Chairman of the
Board of Directors of PSI Group, formerly known as Discount Mail Inc.,
headquartered in Omaha, Nebraska. Mr. Kupka is currently a member of the Board
of Directors of PSI Group. In addition, Mr. Kupka serves as President of Kupka,
Inc. and also serves on the Board of Directors of Micklin Home Improvement Co.
All of these companies are located in Omaha, Nebraska.
Gary L. Petersen, Age 56, Director of the Fund and member of the Executive
Committee, P.O. Box 248, Walton, Nebraska 68461. Mr. Petersen is the retired
President of Petersen Manufacturing Co. Inc. of DeWitt, Nebraska. Mr. Petersen
commenced employment with the Company in February, 1966. He became President in
Bridges Investment Fund, Inc. 9 September 25, 2000
Statement -- Part B
May, 1979, and retired in June, 1986. 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.
John T. Reed, Age 56, Director of the Fund and member of the Audit
Committee, 11336 Pine Street, Omaha, Nebraska. Mr. Reed is Chairman of McCarthy
& Co. of Omaha, Nebraska, a registered broker-dealer and is a shareholder of its
parent, McCarthy Group, Inc. Mr. Reed was formerly with Arthur Andersen & Co.
for 32 years before retiring in August, 1996. Mr. Reed served as the managing
partner of Arthur Andersen & Co.' s Omaha office while also serving as partner
in charge of that office's tax and business consulting practices.
Roy A. Smith, Age 65, Director of the Fund and member of the Planning
Committee, 601 North 108th Circle, Omaha, Nebraska. Mr. Smith was President of
H. P. Smith Motors, Inc. for decades until the Company was sold to a new owner
in the Third Quarter of 1997. Mr. Smith is currently President of Old Mill
Toyota of Omaha, Nebraska, and is a director of the Mid City Bank of Omaha.
Janice D. Stoney, Age 59, Director of the Fund and member of the Executive
Committee, 8912 Farnam Court, Omaha, Nebraska. Mrs. Stoney retired as Executive
Vice President, Total Quality System, US WEST Communications in December, 1992.
Mrs. Stoney began her career within the telephone industry as a service
representative with the Northwestern Bell Telephone Company in August, 1959.
She held various positions in operations and labor relations with her employer
until she was elected Vice President of Human Relations in 1980, a
responsibility she held for three years. Between 1983 and 1985, Mrs. Stoney
fulfilled the position of Vice President _ Marketing of Communication Services.
She was then advanced to lead Northwestern Bell Telephone Company as Executive
Vice President and Chief Operating Officer, 1985 to 1987, and President and
Chief Executive Officer for a $2.3 billion in revenue operation spanning a five-
state area in the Midwest for the years 1987 to 1989. Mrs. Stoney's next
advancement was to US WEST Communications in Denver, Colorado where she served
as President, Consumer Division from 1989 to 1991. During her distinguished
business career, Mrs. Stoney has served on the Board of Directors of the Federal
Reserve Bank, Tenth District, Omaha Branch, from 1984 to 1988; the Northwestern
Bell Telephone Company, 1985 to 1990; Tennant Company located in Minneapolis,
Minnesota from 1986 to 1995; and US WEST Communications Group, Inc., 1989 to
1992. Mrs. Stoney formerly served on the Board of Directors of Guarantee Life
Insurance Company of Omaha, Nebraska from 1987 to 1999, and the Premark
International Corporation, Deerfield, Illinois, from 1989 to 1999. She is also
a Director of the Whirlpool Corporation, headquartered in Benton Harbor,
Michigan where she has served since 1987. Mrs. Stoney was also elected to the
Williams Companies, Inc. Board of Directors in 1999.
L.B. Thomas, Age 63, Director of the Fund and member of the Executive
Committee, 7813 Pierce Circle, Omaha, Nebraska. Mr. Thomas retired in October,
1996, from ConAgra, Inc. He was Senior Vice President, Risk Officer and
Bridges Investment Fund, Inc. 10 September 25, 2000
Statement -- Part B
Corporate Secretary for ConAgra, Inc. at the time of his retirement. ConAgra
has sales of approximately $25 billion world-wide and is the second largest
major processor of food products in the United States. It is headquartered in
Omaha, Nebraska. Mr. Thomas was also a member of ConAgra's Management Executive
Committee. Mr. Thomas joined ConAgra as assistant to the Treasurer in 1960. He
was named Assistant Treasurer in 1966; Vice President, Finance in 1969; Vice
President, Finance and Treasurer in 1974; added the Corporate Secretary
responsibility in 1982; and became Senior Vice President in 1991. Mr. Thomas is
a director of Lozier Corp. located in Omaha, Nebraska and the Exchange Bank of
Mound City, Missouri, and a member and treasurer of the Nebraska Methodist
Health System Board of Directors.
John K. Wilson, Age 45, Director of the Fund and member of the Planning
Committee, 15942 Burt Street, Omaha, Nebraska. Mr. Wilson is President of
Durham Resources, LLC and President of Great Plains Energy Corp. Durham
Resources, LLC is a privately held investment company headquartered in Omaha,
Nebraska. Great Plains Energy Corp. and its wholly owned subsidiary, Great
Plains Natural Gas Co., is a retail distributor of natural gas to 19 communities
in western Minnesota and eastern North Dakota. Mr. Wilson commenced his career
with Durham Resources LLC, and Great Plains Energy Corp. in February, 1983.
Prior to becoming President in May, 1994, Mr. Wilson served in the position of
Secretary-Treasurer and Vice President-Finance. Mr. Wilson currently serves on
the Advisory Board _ U.S. Bank National Association, Omaha, Nebraska.
Nancy K. Dodge, Age 38, Treasurer of the Fund, 8401 West Dodge Road, Omaha,
Nebraska. Mrs. Dodge has been an employee of Bridges Investment Counsel, Inc.
since January, 1980. Her career has progressed through the accounting
department of that Firm, to her present position as Vice President of Fund
Services. Mrs. Dodge is the person primarily responsible for day to day
operations for the Fund, and she is also the key person for handling relations
with shareholders, the custodian bank, and the auditor. Mrs. Dodge is an
officer and Director of Bridges Investor Services, Inc., and a Trust
Administrator for Provident Trust Company.
Brian M. Kirkpatrick, Age 28, Vice President of the Fund, 8401 West Dodge
Road, Omaha, Nebraska. Mr. Kirkpatrick has been an employee of Bridges
Investment Counsel, Inc. since August, 1992. His career has been mainly in the
client accounting and security research areas. In 1998, Brian's role with
Bridges Investment Counsel, Inc. expanded significantly into client counselling,
portfolio management and Director of Security Research. Mr. Kirkpatrick was
elected Vice President of the Fund on April 13, 1999. Mr. Kirkpatrick is also a
Trust Assistant for Provident Trust Company.
Mary Ann Mason, Age 47, Secretary of the Fund, 8401 West Dodge Road, Omaha,
Nebraska. Mrs. Mason has been an employee of Bridges Investment Counsel, Inc.
since June, 1981. Her career has been mainly in the staff services area as a
secretary. Mrs. Mason is also Corporate Secretary for Bridges Investment
Bridges Investment Fund, Inc. 11 September 25, 2000
Statement -- Part B
Counsel, Inc., Secretary and Trust Administrator for Provident Trust Company,
Secretary and Treasurer for both Bridges Investor Services, Inc. and Bridges
Investment Management, Inc., and a Director of Bridges Investor Services.
Linda J. Morris, Age 32, Assistant Treasurer of the Fund, 8401 West Dodge
Road, Omaha, Nebraska. Mrs. Morris has been an employee of Bridges Investment
Counsel, Inc. since August, 1992. Her career with Bridges Investment Counsel,
Inc. has been largely in the client accounting area. In recent years, Linda has
been the primary accounting person to determine the daily net asset value for
the shares of the Fund. Mrs. Morris was elected Assistant Treasurer of the Fund
on April 13, 1999. Mrs. Morris is also Associate Director of Accounting for
Bridges Investment Counsel, Inc. and a Trust Assistant for Provident Trust
Company.
Kathleen J. Stranik, Age 56, Assistant Secretary of the Fund, 8401 West
Dodge Road, Omaha, Nebraska. Mrs. Stranik has been an employee of Bridges
Investment Counsel, Inc. since January, 1986. Mrs. Stranik has served as
executive secretary to both Edson L. Bridges II and Edson L. Bridges III
throughout her career with the Firm. She currently holds the position of Vice
President of Administration for the Fund's investment manager. Mrs. Stranik is
also an officer and Director of Bridges Investor Services, Inc., Assistant
Secretary and Assistant Treasurer and Trust Officer for Provident Trust Company
and Assistant Secretary and Assistant Treasurer for Bridges Investment
Management, Inc.
The Board of Directors of the Fund has three committees: an Audit
Committee, an Executive Committee, and a Planning Committee. The members of
these committees are appointed annually at the April meeting of the Board of
Directors. The members of the Audit Committee currently are: Mr. Frederick N.
Backer, Mr. John W. Estabrook, Mr. Roger A. Kupka, and Mr. John T. Reed. The
members of the Executive Committee currently are: Mr. Edson L. Bridges II, Mr.
N. P. Dodge, Jr., Mr. Gary L. Petersen, Mrs. Janice D. Stoney, and Mr. L.B.
Thomas. The members of the Planning Committee currently are: Mr. Edson L.
Bridges III, Mr. Jon D. Hoffmaster, Mr. John J. Koraleski, Mr. Roy A. Smith, and
Mr. John K. Wilson.
The Executive Committee reviews investment policies for the Fund, and
members of this Committee take action on any matters which the Board should
review at its next meeting for appropriate action. The Audit Committee
establishes the scope of review for the annual audit by its independent auditor,
and its members work with representatives of the independent auditor to
establish such guidelines and tests for the audit which are deemed appropriate
and necessary. The Planning Committee establishes and reviews long-term
planning and directions for the Fund in light of the changing business and
regulatory environment for investment companies in general and with respect to
the Fund in particular.
Bridges Investment Fund, Inc. 12 September 25, 2000
Statement -- Part B
Code of Ethics -- Rule 17j-1 under the 1940 Act requires all registered
investment companies and their investment advisers to adopt written codes of
ethics and institute procedures designed to prevent "access persons" (as defined
in Rule 17j-1) from engaging in any fraudulent, deceptive or manipulative
trading practices. The Fund and Bridges Investment Counsel, Inc. originally
adopted a code of ethics in January, 1982, which was amended in 1994. On
October 12, 1999, the Board of Directors for the Fund and the Board of Directors
for its investment adviser, Bridges Investment Counsel, Inc., adopted a joint
Restated Code of Ethics (the "Code") that incorporates personal trading policies
and procedures applicable to access persons of the Fund and of Bridges
Investment Counsel, Inc. The Code has been designed to address potential
conflict of interests that can arise in connection with the trading
activities of the Fund and investment advisory personnel. Generally, under SEC
Rule 17j-1, access persons include directors and officers of the Fund and
Bridges Investment Counsel, Inc., as well as employees who in connection with
their regular duties, make, participate in, obtain information regarding, or
make recommendations concerning, the purchase or sale of securities by the Fund.
Pursuant to the Code, access persons are generally permitted to engage in
personal securities transactions, provided that such access person does not
purchase or sell, directly or indirectly, any security in which he or she has,
or by reason of such transaction acquires, any direct or indirect beneficial
ownership and which to his or her actual knowledge at the time of such purchase
or sale (a) is being considered for purchase or sale by the Fund; or (b) is
being purchased or sold by the Fund; or (c) has been purchased or sold by the
Fund within the most recent 15 days. In addition, the Code requires access
persons to preclear personal securities investments before such transactions are
initiated, and to internally report all personal securities transactions
quarterly, as well as annual disclosure of all personal securities holdings and
personal financial liabilities. Disinterested directors of the Fund are not
required to make such reports unless the director knew, or in the ordinary
course of fulfilling his or her duties, should have known, of the Fund's
consideration of, or the actual purchase or sale of the security purchased or
sold by the Fund within the applicable time period.
Bridges Investment Fund, Inc. 13 September 25, 2000
Statement -- Part B
Compensation
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 1999, the directors as a group received $13,400.00 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 compensation information is provided for all directors of the
Fund and for each of the executive officers or any affiliated person of the Fund
(with annual compensation in excess of $60,000) for the most recently completed
fiscal year (1999):
<TABLE>
<CAPTION>
COMPENSATION TABLE
__________________________________________________________________________
(1) (2) (3) (4) (5)
Pension or Compensation
Aggregate Retirement Estimated FromlRegistrant
Compensation Benefits Accrued Annual and Fund Complex
Name of Person, From as Part of Fund Benefits Upon Paid to Directors
Position Registrant Expenses Retirement
<S> <C> <C> <C> <C>
Executive Officers:
Edson L. Bridges II None None None None
Chairman and CEO,
and Director
Edson L. Bridges III None None None None
President and
Director
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
John T. Reed None None None None
Roy A. Smith None None None None
Janice D. Stoney None None None None
L.B. Thomas None None None None
John K. Wilson None None None None
</TABLE>
Bridges Investment Fund, Inc. 14 September 25, 2000
Statement -- Part B
Fund directors and officers do not receive any pension, retirement, or other
plan benefits from the Fund.
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.
No person or shareholder owned of record or beneficially more than 5% of
the Fund's outstanding capital stock as of January 31, 2000, when the Fund had a
total of 1,544,980 shares outstanding: However, a group consisting of the
family members of Edson L. Bridges II, beneficially owned 4.55%, as of January
31, 2000.
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. A complete description of ownership of Fund shares by Bridges'
family members may be found in the Fund's 2000 Proxy Statement.
The officers and directors of the Fund owned beneficially and of record, or
had the power to vote, 133,195 shares of the Fund's stock. The members of the
immediate families of officers and directors owned an additional 119,589 shares
for a total beneficial ownership of these persons of 252,784 shares which was
equal to 16.36% of the 1,544,980 shares outstanding as of January 31, 2000.
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 allocated to the accounts of participants are estimates as of January
31, 2000. While the aggregate shareholding numbers are accurate, the Trustees
of the Profit Sharing Trust will not report the allocations to participants for
December 31, 1999, until March 15, 2000, because the financial information upon
which the allocations are made to participants was not complete on the February
25, 2000, filing date for this Statement of Additional Information, 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
corporate Federal Income Tax for Bridges Investment Counsel, Inc. Accordingly,
the disclosure of beneficial interests in the Pension Plan are stated as of
December 31, 1999, while the allocations of percentage interests for the Profit
Sharing Trust are attributed interests as of December 31, 1998. This
methodology was used to disclose the beneficial interest in these trusts as of
January 31, 2000.
Bridges Investment Fund, Inc. 15 September 25, 2000
Statement -- Part B
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 6,684 shares for five participants who are officers of the Fund and its
investment advisers: Edson L. Bridges III, whose ownership interest is 3,582
shares, Mary Ann Mason, whose ownership interest is 1,848 shares, Kathleen J.
Stranik, whose ownership interest is 263 shares, Brian M. Kirkpatrick, whose
ownership interest is 717 shares, and Linda J. Morris, whose ownership interest
is 274 shares.
Unless otherwise noted, 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, 2000.
Investment Advisory and Other Services
Control Persons -- Two persons, Edson L. Bridges II and Edson L. Bridges
III, of the fourteen 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 Bridges Investment Counsel, Inc.
and Chairman and Chief Executive Officer and director of Bridges Investment
Fund, Inc. 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.
A change in the control of ownership of Bridges Investment Counsel, Inc.,
which would cause the current advisory agreement with the Fund to be terminated,
may occur as a result of the death, disability or retirement of Edson L. Bridges
II, who currently owns 87.5% of its common stock. As a result, and as part of
its prudent long range planning to establish an orderly and well-managed
transfer of advisory relationships, Bridges Investment Counsel, Inc. formed
Bridges Investment Management, Inc., as a wholly-owned subsidiary in late 1994,
and has provided working capital and other resources to it since 1995. Bridges
Investment Management, Inc. filed a Form ADV with the Securities and Exchange
Commission which became effective December 9, 1999, and is expected to commence
its advisory business for clients other than the Fund in March, 2000. The
directors of Bridges Investment Management, Inc. are currently Edson L. Bridges
II, Edson L. Bridges III, and Deborah L. Grant. The officers of Bridges
Bridges Investment Fund, Inc. 16 September 25, 2000
Statement -- Part B
Investment Management, Inc. are currently Edson L. Bridges II, Managing
Director; Edson L. Bridges III, President; Deborah L. Grant, Vice President;
Mary Ann Mason, Secretary/Treasurer; and Kathleen J. Stranik, Assistant
Secretary/Assistant Treasurer.
Bridges Investment Counsel, Inc., as investment adviser to the Fund, has
reviewed with the Fund Board of Directors the transfer of the investment
advisory relationship from Bridges Investment Counsel, Inc. to Bridges
Investment Management, Inc., and the Board of Directors has given preliminary
favorable consideration to the transfer, subject to compliance with applicable
legal requirements and Fund shareholder approval. Since the management and
professional personnel associated with Bridges Investment Management, Inc. would
be substantially the same as those currently associated with Bridges Investment
Counsel, Inc., any such transfer would not be expected to change the investment
policies or strategies used in the past with respect to the Fund. The possible
transfer of the investment advisory relationship remains under review, and there
is currently no specific schedule to propose any such transfer to Fund
shareholders for consideration, and no assurance or commitment that such action
will be taken. Investors may refer to the Fund's 1999 Annual Shareholder
Report, and the Chairman's letter to Fund shareholders for further discussion of
this matter.
Affiliated Persons -- As directors and officers of both Bridges Investment
Counsel, Inc. and Bridges Investment Fund, Inc., Mr. Edson L. Bridges II and Mr.
Edson L. Bridges III are affiliated persons of both organizations. There are no
other affiliated persons of the investment adviser and the Fund.
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: $170,328 in 1997, $209,938 in 1998, and $279,316 in
1999. 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 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; registration
and filing fees; salaries and compensation of the Fund's directors and officers;
trading department for 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
Bridges Investment Fund, Inc. 17 September 25, 2000
Statement -- Part B
registrations and the majority of 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. The Fund also pays the fees and costs of First National Bank of Omaha,
Nebraska, the Fund Custodian. The Fund also bears the cost of the insurance
premiums to provide $500,000 in fidelity and errors and omissions coverages
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.
Bridges Investor Services, Inc., 8401 West Dodge Road, Omaha, Nebraska
68114, acts as Dividend Disbursing and Transfer Agent for the Fund. For its
services as transfer agent, Services is paid a quarterly fee by the Fund of $325
($1,300 annually). This is a fixed fee which covers transfer agent costs,
regardless of the number of Fund share transactions. For its services as
dividend disbursing agent, Services is paid by the Fund a fixed fee quarterly of
$300 ($1,200 annually). The Fund also pays Services a quarterly fee of $225
($900 annually) for administrative services provided to the Fund, as well as a
quarterly fee for reimbursement for Account Activity in the amount of $2,100 per
quarter. In addition to these fixed fees, the Fund pays to Services a $1.00 per
transaction fee for opening a new account and transfers in, and a $1.50 per
transaction fee for Fund share redemptions and transfers out. Other
administrative and operational services provided to the Fund, including
preparation and mailing of tax forms on behalf of the Fund, are billed on a time
basis of $28.50 per hour. The Fund reimburses Services for postage and other
out-of-pocket disbursement costs. Services also charges transactional fees to
shareholders of the Fund as described in the Fund's Prospectus. For the year
ended December 31, 1999, the Fund paid a total of $15,738 to Services for all
services provided to the Fund during 1999 (excluding reimbursement for expense
disbursements by Services on behalf of the Fund).
Independent Auditors -- KPMG LLP, 1501 Two Central Park Plaza, Omaha,
Nebraska 68102 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 KPMG LLP meet with the Audit Committee of the Board of
Directors to establish the scope of each audit. The federal and state income
Bridges Investment Fund, Inc. 18 September 25, 2000
Statement -- Part B
tax returns are prepared by the staff of KPMG LLP. Lastly, KPMG 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.
Brokerage Allocations and Other Practices
Transactions in the Fund's portfolio of securities are effected through a
number of 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: $23,917.11 in 1997, $45,224.00 in 1998, and
$27,096.60 in 1999. The Fund's management has no plans to vary the brokerage
commission activity from the pattern shown during the last three fiscal years.
During 1999, brokerage commissions attributed to security research information
were $25,096.60 or 92.62% of the total. There were $2,000 in commissions
attributed to special brokerage services; there were no commissions attributed
to good will in 1999.
Twelve brokers were used by the Fund during 1999, resulting in an average
compensation per brokerage firm of $2,091.38. The largest amount received by
any firm was $5,811.25. 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. In 1999, the
Fund purchased 500 shares of DLJDirect with a purchase value of $10,000, which
is the electronic trading division of Donaldson Lufkin Jenrette, a brokerage
firm used by the Fund from time to time. The Fund's position in DLJDirect was
sold in 1999, and as of December 31, 1999, the Fund owned no shares of
DLJDirect. As of December 31, 1999, the Fund owned shares of Merrill Lynch &
Co., a brokerage firm used by the Fund from time to time, with a value of
$249,938, representing 0.36% of Fund assets. The Fund paid Merrill Lynch $1,688
in brokerage commissions in 1999.
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.
Bridges Investment Fund, Inc. 19 September 25, 2000
Statement -- Part B
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. 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, 1999.
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 III, President of the Fund, selects the brokers to be
employed for securities transactions of the Fund, and he determines the
acceptability of the discount.
Investment Adviser's Trade Aggregation Policy -- Bridges Investment
Counsel, Inc. performs investment management and advisory services for various
clients including the Fund. In certain instances, portfolio transactions for
the Fund may be executed in an aggregated transaction to purchase or sell the
same security for other accounts served by Bridges Investment Counsel, Inc. The
objective of aggregated transactions is to obtain favorable execution and/or
lower brokerage commissions, although there is no certainty that such objective
will be achieved. Aggregated transactions in which the Fund participates will
be effected only when Bridges Investment Counsel, Inc. believes that to do so
will be in the best interest of the Fund. When this occurs, no client account
will be favored over any other account.
Each account that participates in an aggregated order will participate at
the average share price for all Bridges Investment Counsel, Inc. transactions in
that security on a given business day, with transaction costs shared pro rata
based on each account's participation in the transaction. Bridges Investment
Bridges Investment Fund, Inc. 20 September 25, 2000
Statement -- Part B
Counsel, Inc. will prepare, before entering an aggregate order, a written
statement (the "Allocation Statement") for each proposed aggregated order,
specifying the participating client accounts and how it intends to allocate the
order. An order may be allocated on a basis different from that specified in
the Allocation Statement if all client accounts receive fair and equitable
treatment and the reason for the different allocation is explained in writing
and is approved in writing by a Bridges Investment Counsel, Inc. compliance
officer.
While it is possible that the use of aggregated orders may adversely affect
the size of the position obtainable for the Fund, Bridges Investment Counsel,
Inc. as the Fund investment adviser believes that the procedure generally
contributes to better overall execution of the Fund's portfolio transactions.
Bridges Investment Counsel, Inc. is not obligated to aggregate orders on behalf
of clients, and its decision not to aggregate orders in any particular instance
may result in less favorable execution of trades and in higher transaction costs
to its clients, including the Fund.
Capital Stock and Other Securities
The Fund's capital structure consists of 3,000,000 authorized shares of
capital stock (par value of one dollar per share) with 2,360,677 shares issued
as of December 31, 1999. Fund 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 number of shares redeemed.
As of December 31, 1999, 852,523 shares of the Fund had been redeemed since
inception of the Fund in 1963. The Fund's net shares of capital stock
outstanding were 1,508,154 on December 31, 1999.
Cumulative Voting _ Fund shares are entitled to cumulative voting rights.
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 -- Shares of the Fund are offered and sold directly to
investors 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 Fund does
not have any arrangements with underwriters or broker dealers with respect to
Bridges Investment Fund, Inc. 21 September 25, 2000
Statement -- Part B
the purchase or sale of Fund shares, nor make any payments to underwriters or
broker-dealers in connection with the purchase or sale of Fund shares. The Fund
is not permitted to redeem shares involuntarily in accounts below a certain
number or value of shares. The Fund will honor all properly documented requests
for redemption irrespective of the length of time investors have maintained
their account with the Fund. Information concerning the methods of purchase and
redemption of Fund shares are set forth in the Fund's Prospectus. The Fund does
not use letters of intent, contractual accumulation plans, withdrawal plans, or
exchange privileges.
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 in the Fund's
Prospectus.
Specimen Price Make Up -- Please refer to Appendix A 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, 1999. 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.
Other Disclosures -- 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.
Description of Fund Plans
Standard Retirement Plan -- Bridges Investment Fund, Inc. offers a master
Standard Retirement Plan (as Amended and Restated as of January 1, 1989) for
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, including a SIMPLE Model Amendment for employers
with less than 100 employees. The master plan includes a Standard Custodial
Bridges Investment Fund, Inc. 22 September 25, 2000
Statement -- Part B
Agreement (as Amended and Restated as of January 1, 1989) under which U.S. Bank
National Association, 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.
Currently, the Custodian does not impose maintenance or other fees in
connection with the above described Standard Retirement Plan; however the
Custodian may impose such fees 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. 23 September 25, 2000
Statement -- Part B
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 U.S. Bank National Association,
Omaha, Nebraska, will furnish custodial services as required by such Act.
Currently, the investor is not charged any maintenance or other fees in
connection with the Individual Retirement Custodial Account; however, the
Custodian may impose such fees from time to time by written agreement between
Custodian and Depositor. The investor may be subject to additional charges,
from time to time, as will reasonably compensate the Custodian for extraordinary
services resulting from unusual administrative responsibilities. 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 $2,000 is permitted to
a separate IRA maintained by such non-working spouse for a total contribution of
$4,000. 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 specifically exempted by law, will
result in tax penalties in addition to being included in taxable income. 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
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 U.S. Bank National
Association, Omaha, Nebraska, three copies of the Application Form and three
copies of the Contribution Form. U.S. Bank National Association, 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.
Bridges Investment Fund, Inc. 24 September 25, 2000
Statement -- Part B
The Application Form establishes the Custodial Account, collects pertinent
information to govern the Custodial Account, and recites the applicable fees to
be charged by U.S. Bank National Association, 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.
U.S. Bank National Association, 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.
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 or her 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 or her 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
IRS Announcement 86-121 should also be helpful, copies of which may be obtained
from the Fund's office.
Additional consideration should be given by the individual who
contemplates the establishment of a Prototype to new choices and opportunities
that were created in 1997.
Bridges Investment Fund, Inc. 25 September 25, 2000
Statement -- Part B
1)The SIMPLE Individual Retirement Custodial Account, as described in
Section 408(p) of the Internal Revenue Code may be established in
connection with a Salary Reduction Agreement. Under this funding
choice, it is possible to set aside more than the $2,000 per year
contribution limit for the traditional IRA account. Depending upon the
circumstances involved, it may be possible to receive employer matching
contributions in the account. This SIMPLE Plan is identified with the
Internal Revenue Service through
letter Serial No. D111476C.
2)The Roth Individual Retirement Custodial Account opportunity for
investment was created by the Taxpayer Relief Act of 1997. The
legislation provides for a non-deductible annual contribution of $2,000
for a working spouse and a $2,000 contribution for a non-working spouse.
Benefits paid from the Roth IRA are to be non-taxable to the Depositor
upon a qualified distribution from the IRA, which includes distributions
made after the Depositor reaches age 59 1/2. The Roth Individual
Retirement Custodial Account may be established through the execution of
the Form 5305-RA issued under Section 408A of the Internal Revenue Code
in conjunction with the standard, traditional IRA Custodial Account of
the Fund as described above. Depositors may establish and maintain both
the "Traditional" IRA and the "Roth" IRA Accounts, provided the assets
are always maintained in separately segregated accounts and provided
further that the titles therein accurately reflect the distinctions
between the two types of funding permitted by statute. Depositors will
still have a $2,000 annual limit per working spouse and non-working
spouse, so that a choice must be made between the contribution amounts
that would represent an income exclusion and the contribution amounts
that would be taxable underneath the $2,000 annual ceiling.
3)An individual may deposit up to $500 a year into an Education Individual
Retirement Custodial Account (Internal Revenue Service Form 5305-EA) for
a child under age 18, provided the total contributions for the child
during the year do not exceed $500. The contributor may be a parent,
relative, friend, or other person, including the child him/herself. The
ability to contribute to an Education IRA phases out at modified
adjusted gross income levels between $95,000 and $110,000 for unmarried
individuals and between $150,000 and $160,000 for joint return filers.
Distributions from an Education IRA are tax-free up to the amount of
qualified higher education expenses for a year. Qualified higher
education expenses include tuition, fees, books, supplies, and, if the
beneficiary is at least a half-time student, room and board.
The Fund's office maintains a supply of SIMPLE Individual Retirement Custodial
account forms and an inventory for the Form 5305-RA for the Roth IRA, and Form
5305-EA for the Education IRA to assist Depositors to establish these types of
accounts.
Bridges Investment Fund, Inc. 26 September 25, 2000
Statement -- Part B
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.
Underwriters: None
Calculation of Performance Data
From time to time, quotations of the Fund's performance may be included in
advertisements, sale literature or reports to shareholders or prospective
investors. These performance figures are calculated as described below.
PAST PERFORMANCE OF FUND
The bar chart and table on the following page show one measure of the risks
of investing in the Fund, by showing the Fund's performance from year to year
for the past ten calendar years and by showing how the average annual total
returns of the Fund's shares compare to those of a broad-based market index.
The Fund's past investment performance is not necessarily an indication of how
the Fund will perform in the future.
PERFORMANCE HISTORY DEPICTED IN A BAR GRAPH IS AS FOLLOWS:
Year % Return
1990 1.81%
1991 21.01%
1992 6.03%
1993 6.29%
1994 0.30%
1995 30.96%
1996 18.06%
1997 22.33%
1998 27.48%
1999 39.80%
Bridges Investment Fund, Inc. 27 September 25, 2000
Statement -- Part B
The Fund's highest and lowest returns for a calendar quarter during the
past ten years are a return of 28.12% for the 4th Quarter 1999, and
-8.83% for the 3rd Quarter 1990.
Average Annual Total Past One Past Five Past Ten
Returns Year Years Years
(for the periods ending
December 31, 1999)
Bridges Investment Fund, Inc. 38.90% 27.34% 16.64%
S & P 500 21.01% 28.49% 19.16%
Total Return is the change in value of an investment over a given period,
assuming reinvestment of any dividends and capital gains. A cumulative total
return reflects actual performance over a stated period of time. An average
annual total return is a hypothetical rate of return that, if achieved annually,
would have produced the same cumulative total return if performance had been
constant over the entire period. Average annual total returns smooth out
variations in performance; they are not the same as the actual year-by-year
results.
Bridges Investment Fund, Inc. 28 September 25, 2000
Statement -- Part B
Table _ Line Chart
Year BIF S & P 500
1989 10,000.00 10,000.00
1990 10,180.36 9,689.22
1991 12,318.63 12,318.63
1992 13,060.87 13,589.54
1993 13,881.48 14,950.48
1994 13,922.13 15,153.12
1995 18,230.79 20,826.41
1996 21,522.01 25,596.74
1997 26,326.60 34,125.56
1998 33,559.22 43,858.21
1999 46,614.11 53,075.17
(Amounts in table above represent year-end market values, and are plotted
as data points on a line graph)
Average Annual Total Return for Bridges Investment Fund, Inc.:
1 Year 38.90%
5 Year 27.34%
10 Year 16.64%
Past Performance is not predictive of future performance.
Bridges Investment Fund, Inc. 29 September 25, 2000
Statement -- Part B
INFORMATION SUPPORTING AND SETTING QUALIFICATIONS
FOR INVESTMENT RETURNS
Assumptions
1.The initial investment was made at the public offering price last
calculated on the business day before the first day of the first fiscal
year.
2.The subsequent account values are based on the net asset values of the
Fund last calculated on the last business day of the first and each
subsequent fiscal year.
3.The calculation for the final account value assumes the account was closed
and the redemption was at the price last calculated on the last business
day of the most recent fiscal year.
4.All dividends and capital gains distributions by the Fund were reinvested
at the price on the reinvestment dates. The dividend for the Standard &
Poor's 500 Composite Index for the previous quarter was invested at the
month-end price closest to the reinvestment date for the Fund.
5.Reinvestment fees for dividend and capital gains distributions were
deducted before reinvestment in shares of the Fund. The Standard & Poor's
500 Composite Index was not charged with any brokerage commissions,
reinvestment fees, or operating expenses.
Appropriate Index
The Fund is to select an "appropriate broad-based securities market index"
that is administered by an organization that is not an affiliated person of the
Fund or its investment adviser. The securities index chosen must be adjusted to
reflect reinvestment of dividends on securities in the index, but not the
expenses of the Fund.
Use of Additional Indexes
In addition to the required comparison to a broadly-based index, mutual
fund registrants with the Securities and Exchange Commission are urged to
compare their performances to other more narrowly-based indexes that reflect the
market sectors in which they invest. Management has investigated commercial
paper, Treasury Bill, Treasury Note, Treasury Bond, and Corporate Bond indexes
to cover those portfolio segments not invested in the common stock market. Some
problems with comparable information have been encountered particularly with
respect to the difficulty of matching income reinvestment dates in the indexes
with the reinvestment calendar scheme in effect for the Fund. Therefore, at
this point in time, the Fund management has decided not to present the
comparisons to the more narrow indices.
Bridges Investment Fund, Inc. 30 September 25, 2000
Statement -- Part B
From time to time, in reports and promotional literature: (1) the Fund's
total return performance, ranking, or any other measure of the Fund's
performance may be compared to any or combination of the following: (a) a
broad-based index; (b) other groups of mutual funds tracked by independent
research firms ranking entities, or financial publications; (c) indices of
securities comparable to those in which the Fund invests; (2) the Consumer Price
Index (or any other measure for inflation, government statistics, such as GNP)
may be used to illustrate investment attributes of the Fund or the general
economic, business, investment, or financial environment in which the Fund
operates; and (3) various financial, economic and market statistics developed by
brokers, dealers and other persons may be used to illustrate aspects of the
Fund's performance. The Fund may also advertise the performance rankings
assigned by various publications and statistical services, and any other data
which may be presented from time to time by such analysts as Dow Jones and
Morningstar, Inc., or as they appear in various financial and investment
publications, including but not limited to The Wall Street Journal, Business
Week, Forbes, Fortune, Money Magazine and other such publications.
__________________________________________________________________________
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.
__________________________________________________________________________
Financial Statements
The audited financial statements for the year ended December 31, 1999,
appear on pages 30 - 47 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 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.
The Price Make Up Sheet, Appendix A, is shown on page 31; then the
financial statements follow as a unit to complete this Part B.
Bridges Investment Fund, Inc. 31 September 25, 2000
Statement -- Part B
<TABLE>
APPENDIX A(Specimen)
PRICE MAKE UP SHEET
December 31, 1999
<CAPTION>
Journal Form,
Ledger Form, Actual Balance
Schedule, or or Market
Account Number ACCOUNT (Cost Figures in Parentheses) Value Figures
<S> <C> <C>
ASSETS
01a-DR-C Cash-Principal $ 5,852.87
01b-DR-C Cash-Income 118,075.45
02a-LF51 Dividends Receivable 37,205.00
02b-LF52 Interest Receivable 77,409.18
04a-CRDJ Accts. Receivable-Subscriptions to Capital Stock 841,773.64
04b-CRDJ Accts. Receivable-Securities Sold 638,361.51
07 -Schedule 7 Inv. in Securities (28,914,315.12) 68,265,291.02
CRS
______________ ______________________________________________________
______________ ______________________________________________________
TOTAL ASSETS $69,983,968.67
LIABILITIES:
13a-CRDJ Accts. Pay.-Redemptions of Capital Stock $ _____3,800.00
13b-CRDJ Accts. Pay.-Purchase of Securities _______________
14a-CRDJ Accrued Liab.-Operating Expenses 110,258.75
14b-CRDJ Accrued Liab.-Taxes _______________
14 -CRDJ Distributions Payable $ 134,225.77
______________ ______________________________________________________
______________
______________ ______________________________________________________
______________
______________
TOTAL LIABILITIES 248,284.52
19 NET ASSETS APPLICABLE TO OUTSTANDING
CAPITAL SHARES (Tot. Assets Minus Tot. Liab.) $69,735,684.15
20 -CRDJ DR-TA Capital Stock-Total Shares Outstanding 1,508,154.054
NET ASSET VALUE PER SHARE
Purchase Price Per Share $46.24 46.24
Redemption Price Per Share $46.24 x Div.@ .089
Equalization Computation Net Investment Income 0.00
(Current Qtr.) (Current Qtr.)
Dividend Income $105,617.16 Undistributed Net Income 0.00
Interest Income 129,378.18 (Previous Qtrs.)
Total Income $234,995.34 Total Acct. 21b 0.00
Equalization/Share .00
Taxes Paid $__________ Orders /
Expenses Unpaid 113,000.00 Net Shares Purch., Redemp. ,
, .
Reimbursed Expenses (_________) Balance, Equalization 1,393.07
Tot.Exp.Post Close __________ Equalization Entry
______________
Equalization Forward
______________
Net Investment Inc. $121,995.34 Capital Shares Forward 1,508,154.054
</TABLE>
Bridges Investment Fund, Inc. 32 September 25, 2000
Statement -- Part B
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and the Board of Directors of
Bridges Investment Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
Bridges Investment Fund, Inc. including the schedule of portfolio investments,
as of December 31, 1999, the related statement of operations for the year then
ended, and the statements of changes in net assets and financial highlights for
each of the years in the two year period then ended. These financial statements
are the responsibility of Bridges Investment Fund, Inc. Our responsibility is
to express an opinion on these financial statements based on our audit. The
financial highlights for each of the years in the three year period ended
<PAGE>
December 31, 1997 were audited by other auditors whose report thereon dated
January 16, 1998 expressed an unqualified opinion on those statements.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements 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, 1999 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 audit provides 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, 1999, the results of its
operations for the year then ended, the changes in its net assets and financial
highlights for each of the years in the two year period then ended, in
conformity with generally accepted accounting principles.
KPMG LLP
January 7, 2000
<PAGE>
Bridges Investment Fund, Inc. -33- September 25, 2000
Statement -- Part B
<TABLE>
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
DECEMBER 31, 1999
<CAPTION>
NUMBER
TITLE OF SECURITY OF SHARES COST VALUET
<S> <C> <C> <C>
COMMON STOCKS - (86.3%)
ADVERTISING _ 0.5%
INTERPUBLIC GROUP OF COMPANIES, INC. (THE) 4,000 $ 106,953 $ 230,750
LAMAR ADVERTISING COMPANY*<FN> 2,000 92,125 121,125
$ 199,078 $ 351,875
AIRCRAFT _ MANUFACTURING - 0.7%
THE BOEING COMPANY 12,000 $ 278,135 $ 497,250
AMUSEMENTS _ RECREATION _ SPORTING GOODS _ 0.3%
NIKE, INC. 5,000 $ 171,270 $ 247,813
BANKING AND FINANCE - 3.2%
CHASE MANHATTAN CORPORATION (THE) 2,000 $ 86,650 $ 155,375
FIRST NATIONAL OF NEBRASKA, INC. 230 346,835 552,000
MBNA CORPORATION 15,000 234,825 408,750
STATE STREET CORPORATION 8,000 66,525 584,500
<PAGE>
U.S. BANCORP 5,000 166,370 119,063
WELLS FARGO & CO. 10,000 138,173 404,375
$ 1,039,378 $ 2,224,063
BEVERAGES _ SOFT DRINKS - 1.2%
PEPSICO, INC. 24,000 $ 307,470 $ 846,000
BROADCAST SERVICE/PROGRAM _ 0.3%
AT&T CORPORATION _ LIBERTY MEDIA*<FN> 3,500 $ 169,085 $ 198,844
CHEMICALS - 1.1%
THE DOW CHEMICAL COMPANY 6,000 $ 396,947 $ 801,750
COMMUNICATIONS _ RADIO AND TELEVISION _ 1.3%
CLEAR CHANNEL COMMUNICATIONS, INC.*<FN> 10,000 $ 366,954 $ 892,500
COMPUTERS _ HARDWARE AND SOFTWARE - 11.8%
CISCO SYSTEMS, INC.*<FN> 18,000 290,726 1,928,250
DELL COMPUTER CORPORATION *<FN> 3,000 109,594 153,000
HNC SOFTWARE, INC.*<FN> 18,000 598,741 1,903,500
HEWLETT-PACKARD CO. 6,000 83,784 682,500
MICROSOFT CORPORATION*<FN> 20,000 93,361 2,335,000
TIBCO SOFTWARE, INC.*<FN> 2,000 153,194 306,000
TRANSACTION SYSTEMS ARCHITECTS, INC.*<FN> 32,000 1,102,118 896,000
$ 2,431,518 $ 8,204,250
COMPUTERS _ MEMORY DEVICES _ 2.5%
EMC CORPORATION/MASS*<FN> 16,000 $ 358,855 $ 1,748,000
COMPUTERS _ MICRO _ 1.1%
SUN MICROSYSTEMS, INC.*<FN> 10,000 $ 281,812 $ 774,375
<PAGE>
<FN>*NONINCOME-PRODUCING SECURITY
Bridges Investment Fund, Inc. -34- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
(CONTINUED)
DECEMBER 31, 1999
<CAPTION>
NUMBER MARKET
TITLE OF SECURITY OF SHARES COST VALUE
<S> <C> <C> <C>
COMMON STOCKS (CONTINUED)
DATA PROCESSING AND MANAGEMENT _ 1.7%
CSG SYSTEMS*<FN> 18,000 $ 509,169 $ 717,750
FIRST DATA CORPORATION 10,000 458,100 493,125
$ 967,269 $ 1,210,875
DIVERSIFIED OPERATIONS _ 0.6%
BERKSHIRE HATHAWAY INC., CLASS B *<FN> 210 $ 150,375 $ 384,300
DRUGS - MEDICINES _ COSMETICS - 6.3%
ABBOTT LABORATORIES 15,000 $ 169,395 $ 544,688
AMGEN, INC.*<FN> 12,000 248,688 720,750
BRISTOL-MYERS SQUIBB CO. 8,000 141,675 513,500
ELAN CORPORATION PLC ADR*<FN> 20,000 419,005 590,000
JOHNSON & JOHNSON 10,000 109,396 932,500
<PAGE>
MERCK & CO., INC. 16,000 274,266 1,075,000
$ 1,362,425 $ 4,376,438
ELECTRICAL EQUIPMENT AND SUPPLIES - 1.8%
GENERAL ELECTRIC CO. 8,000 $ 147,473 $ 1,238,000
ELECTRIC _ GENERATION _ 0.5%
AES CORPORATION*<FN> 5,000 $ 277,053 $ 373,750
ELECTRONIC COMPONENTS _ CONDUCTORS _ 0.4%
ALTERA CORPORATION*<FN> 6,000 $ 185,375 $ 297,375
ELECTRONICS - 4.1%
INTEL CORPORATION 20,000 $ 334,735 $ 1,646,250
SOLECTRON CORPORATION *<FN> 13,000 301,136 1,236,625
$ 635,871 $ 2,882,875
FINANCE _ CREDIT CARDS _ 0.5%
AMERICAN EXPRESS COMPANY 2,000 $ 165,255 $ 332,500
FINANCE _ DIVERSIFIED _ 0.6%
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO. 3,000 $ 202,960 $ 428,250
FINANCE _ INVESTMENT BANKS _ 0.5%
MERRILL LYNCH & CO., INC. 3,000 168,586 249,938
E*TRADE GROUP, INC.*<FN> 4,000 98,188 104,500
$ 266,774 $ 354,438
FINANCE - REAL ESTATE - 2.0%
FREDDIE MAC 30,000 $ 470,320 $ 1,411,875
<PAGE>
<FN>*NONINCOME-PRODUCING SECURITY
Bridges Investment Fund, Inc. -35- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
(CONTINUED)
DECEMBER 31, 1999
<CAPTION>
NUMBER MARKET
TITLE OF SECURITY OF SHARES COST VALUE
<S> <C> <C> <C>
COMMON STOCKS (CONTINUED)
FINANCE _ SERVICES - 2.7%
CAPITAL ONE FINANCIAL CORPORATION 35,000 $ 683,206 $ 1,686,563
PAYCHEX, INC. 5,000 154,125 200,000
$ 837,331 $ 1,886,563
FOOD _ MISCELLANEOUS PRODUCTS - 0.5%
PHILIP MORRIS COMPANIES, INC. 15,000 $ 263,604 $ 345,000
INSURANCE _ MULTILINE - 0.5%
AMERICAN INTERNATIONAL GROUP, INC. 3,125 $ 118,455 $ 337,891
INSURANCE _ MUNICIPAL BOND _ 0.6%
<PAGE>
MBIA, INC. 8,000 $ 360,053 $ 422,500
INTERNET SOFTWARE _ 1.3%
AMERICA ONLINE, INC.*<FN> 12,000 $ 529,238 $ 903,000
LINEN SUPPLY AND RELATED PRODUCTS - 0.3%
CINTAS CORPORATION*<FN> 4,000 $ 166,578 $ 212,500
MOTION PICTURES AND THEATRES - 0.9%
THE WALT DISNEY COMPANY 22,000 $ 236,300 $ 643,500
PETROLEUM PRODUCING - 4.4%
BP AMOCO PLC-SPONSORED ADR 13,232 $ 246,135 $ 784,823
ATLANTIC RICHFIELD COMPANY 4,000 211,835 346,000
CHEVRON CORPORATION 10,000 340,535 866,250
EXXON MOBIL CORPORATION 13,280 325,810 1,069,870
$ 1,124,315 $ 3,066,943
PUBLISHING _ NEWSPAPERS - 1.0%
GANNETT CO., INC. 8,000 $ 179,310 $ 652,500
PUBLISHING _ ELECTRONIC - 0.6%
REUTERS GROUP PLC, ADR SPONSORED 5,199 $ 166,303 $ 420,144
RETAIL STORES _ APPAREL AND CLOTHING - 3.3%
GAP, INC. 50,000 $ 521,360 $ 2,300,000
RETAIL STORES _ BUILDING MATERIALS AND HOME
IMPROVEMENT _ 3.0%
THE HOME DEPOT, INC. 30,000 $ 587,115 $ 2,062,500
<PAGE>
<FN>*NONINCOME-PRODUCING SECURITY
Bridges Investment Fund, Inc. -36- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
(CONTINUED)
DECEMBER 31, 1999
<CAPTION>
NUMBER MARKET
TITLE OF SECURITY OF SHARES COST VALUE
<S> <C> <C> <C>
COMMON STOCKS (CONTINUED)
RETAIL STORES _ DEPARTMENT - 1.6%
DAYTON HUDSON CORPORATION 15,000 $ 146,129 $ 1,101,563
STEEL - PRODUCERS _ 0.4%
NUCOR CORPORATION 5,500 $ 122,061 $ 301,469
TELECOMMUNICATIONS - 9.6%
LEVEL 3 COMMUNICATIONS *<FN> 12,000 $ 483,300 $ 982,500
MCI WORLDCOM, INC. *<FN> 19,500 466,188 1,034,719
SPRINT CORPORATION 10,000 83,964 673,125
SPRINT PCS CORPORATION *<FN> 5,500 188,878 563,750
<PAGE>
VODAFONE AIRTOUCH PLC SPONSORED ADR 40,000 915,541 1,980,000
WEST TELESERVICES CORPORATION*<FN> 58,200 780,844 1,422,263
$ 2,918,715 $ 6,656,357
TELECOMMUNICATIONS _ EQUIPMENT _ 9.9%
NOKIA CORPORATION SPONSORED ADR 12,000 $ 492,858 $ 2,292,750
QUALCOMM INCORPORATED *<FN> 26,000 273,901 4,582,500
$ 766,759 $ 6,875,250
TELEVISION _ CABLE _ 0.4%
COMCAST CORPORATION*<FN> 6,000 $ 141,375 $ 303,375
TRANSPORTATION _ AIRFREIGHT _ 2.0%
EAGLE USA AIRFREIGHT, INC. *<FN> 33,000 $ 416,042 $ 1,423,125
TRANSPORTATION _ RAILROADS - 0.3%
UNION PACIFIC CORPORATION 4,000 $ 148,580 $ 174,750
TOTAL COMMON STOCKS (COST - $20,581,276) $20,581,276 $60,166,326
PREFERRED STOCKS (1.2%)
BANKING AND FINANCE _ 0.7%
CFB CAPITAL II 8.20% CUMULATIVE PREFERRED 5,000 $ 125,000 $ 101,875
CFC CAPITAL TRUST 9.375% PREFERRED, SERIES B 5,000 125,000 112,500
HARRIS PREFERRED CAPITAL CORP., 10,000 250,000 203,125
7.375%, SERIES A
SILICON VALLEY BANCSHARES 5,000 125,000 92,500
8.25% PREFERRED SERIES I
$ 625,000 $ 510,000
<PAGE>
<FN>*NONINCOME-PRODUCING SECURITY
Bridges Investment Fund, Inc. -37- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
(CONTINUED)
DECEMBER 31, 1999
<CAPTION>
NUMBER MARKET
TITLE OF SECURITY OF SHARES COST VALUE
<S> <C> <C> <C>
OIL COMP. _ EXPLORATION AND PRODUCTION _ 0.2%
CANADIAN OCCIDENTAL PETROLEUM LTD. 5,000 $ 125,000 $ 111,563
9.375% PREFERRED _ SERIES 1
UTILITIES _ ELECTRIC _ 0.3%
TENNESSEE VALLEY AUTHORITY 6.75% 10,000 $ 250,000 $ 216,250
VARIABLE PREFERRED SERIES D
TOTAL PREFERRED STOCKS (COST - $1,000,000) $ 1,000,000 $ 837,813
TOTAL STOCKS (COST - $21,581,276) $21,581,276 $61,004,139
<PAGE>
DEBT SECURITIES (10.4%)
AUTO-CARS/LIGHT TRUCKS _ 0.4%
GENERAL MOTORS CORPORATION 7.700% DEBENTURES
DUE APRIL 15, 2016 $250,000 $ 252,320 $ 249,525
ENERGY _ ALTERNATE SOURCES - 0.3%
CALENERGY CO., INC., 7.630% NOTES
DUE OCTOBER 15, 2007 $200,000 $ 200,000 $ 197,217
HOTELS AND MOTELS _ 0.4%
MARRIOT INTERNATIONAL 7.875% NOTES SERIES C
DUE SEPTEMBER 15, 2009 $250,000 $ 250,068 $ 246,157
HOUSEHOLD APPLIANCES AND UTENSILS - 0.1%
MAYTAG CORP., 9.750% NOTES,
DUE MAY 15, 2002 $100,000 $ 102,200 $ 105,537
OFFICE EQUIPMENT AND SUPPLIES - 0.1%
XEROX CORPORATION, 9.750% NOTES
DUE MARCH 15, 2000 $100,000 $ 100,025 $ 100,621
RETAIL STORES _ DEPARTMENT - 0.4%
DILLARD DEPARTMENT STORES, INC., 7.850%
DEBENTURES, DUE OCTOBER 1, 2012 $150,000 $ 151,348 $ 139,046
SEARS ROEBUCK & CO., 9.375% DEBENTURES
DUE NOVEMBER 1, 2011 100,000 $ 106,399 108,971
$ 257,747 $ 248,017
<PAGE>
<C>*NONINCOME-PRODUCING SECURITY
Bridges Investment Fund, Inc. -38- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
(CONTINUED)
DECEMBER 31, 1999
<CAPTION>
PRINCIPAL MARKET
TITLE OF SECURITY AMOUNT COST VALUE
<S> <C> <C> <C>
DEBT SECURITIES (CONTINUED)
TELECOMMUNICATIONS _ 0.3%
LEVEL 3 COMMUNICATIONS, INC., 9.125% SENIOR $250,000 $ 241,938 $ 236,895
NOTES DUE MAY 1, 2008
U.S. GOVERNMENT _ 3.9%
U.S. TREASURY, 8.750% NOTES,
DUE AUGUST 15, 2000 200,000 $ 211,900 $ 203,406
U.S. TREASURY, 8.000% NOTES,
DUE MAY 15, 2001 200,000 199,052 204,688
<PAGE>
U.S. TREASURY, 7.500% NOTES,
DUE MAY 15, 2002 200,000 214,098 205,406
U.S. TREASURY, 10.750% BONDS
DUE FEBRUARY 15, 2003 200,000 219,525 224,062
U.S. TREASURY, 7.250% NOTES,
DUE MAY 15, 2004 300,000 303,245 309,234
U.S. TREASURY, 7.500% NOTES,
DUE FEBRUARY 15, 2005 300,000 305,871 313,030
U.S. TREASURY, 9.375% BONDS,
DUE FEBRUARY 15, 2006 200,000 256,223 228,250
U.S. TREASURY, 7.625% BONDS,
DUE FEBRUARY 15, 2007 300,000 307,910 305,718
U.S. TREASURY, 8.750% BONDS,
DUE NOVEMBER 15, 2008 200,000 237,473 214,124
U.S. TREASURY, 9.125% BONDS,
DUE MAY 15, 2009 200,000 234,910 218,312
U.S. TREASURY, 7.500% BONDS,
DUE NOVEMBER 15, 2016 300,000 308,534 320,953
$ 2,798,741 $ 2,747,183
<PAGE>
Bridges Investment Fund, Inc. -39- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS
DECEMBER 31, 1999
<CAPTION>
PRINCIPAL MARKET
TITLE OF SECURITY AMOUNT COST VALUE
<S> <C> <C> <C>
DEBT SECURITIES (CONTINUED)
COMMERCIAL PAPER _ SHORT TERM _ 4.5%
AMERICAN EXPRESS CREDIT CORPORATION
COMMERCIAL PAPER NOTE 6.250%
DUE JANUARY 4, 2000 $1,260,000 $ 1,260,000 $ 1,260,000
AMERICAN EXPRESS CREDIT CORPORATION
COMMERCIAL PAPER NOTE 5.000%
DUE JANUARY 7, 2000 1,500,000 1,500,000 1,500,000
FORD MOTOR CREDIT CORPORATION
COMMERCIAL PAPER NOTE 2.000%
DUE JANUARY 7, 2000 370,000 370,000 370,000
$ 3,130,000 $ 3,130,000
TOTAL DEBT SECURITIES (COST - $7,333,039) $ 7,333,039 $ 7,261,152
<PAGE>
TOTAL INVESTMENTS IN SECURITIES - (97.9%)
(COST - $28,914,320) $28,914,320 $68,265,291
CASH AND RECEIVABLES
LESS TOTAL LIABILITIES _ (2.1%) 1,470,393
NET ASSETS, DECEMBER 31, 1999 _ (100.0%) $69,735,684
<FN>THE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
ARE AN INTEGRAL PART OF THIS SCHEDULE.
</TABLE>
<PAGE>
Bridges Investment Fund, Inc. -40- September 25, 2000
Statement -- Part B
<TABLE>
BRIDGES INVESTMENT FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
<S>
ASSETS AMOUNT
<C>
INVESTMENTS, AT MARKET VALUE
COMMON AND PREFERRED STOCKS
(COST $21,581,276) $61,004,139
DEBT SECURITIES (COST $7,333,039) 7,261,152
TOTAL INVESTMENTS $68,265,291
CASH 123,928
RECEIVABLES
DIVIDENDS AND INTEREST 114,614
SUBSCRIPTIONS TO CAPITAL STOCK 841,774
SECURITIES SOLD 638,362
TOTAL ASSETS $69,983,969
LIABILITIES
DIVIDEND DISTRIBUTIONS PAYABLE $ 134,226
REDEMPTION OF CAPITAL STOCK 3,800
<PAGE>
INVESTMENT ADVISOR, MANAGEMENT AND
SERVICE FEES PAYABLE 85,066
ACCRUED OPERATING EXPENSES 25,193
TOTAL LIABILITIES $ 248,285
NET ASSETS
CAPITAL STOCK, $1 PAR VALUE
AUTHORIZED 3,000,000 SHARES,
1,508,154 SHARES OUTSTANDING $ 1,508,154
PAID-IN SURPLUS - 27,816,382
NET CAPITAL PAID IN ON SHARES $29,324,536
NET UNREALIZED APPRECIATION ON INVESTMENTS 39,350,976
ACCUMULATED UNDISTRIBUTED NET REALIZED GAINS 1,058,779
ACCUMULATED UNDISTRIBUTED NET
INVESTMENT INCOME 1,393
TOTAL NET ASSETS $69,735,684
NET ASSET VALUE PER SHARE $46.24
OFFERING PRICE PER SHARE $46.24
REDEMPTION PRICE PER SHARE $46.24
<FN>THE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
ARE AN INTEGRAL PART OF THIS STATEMENT.
<PAGE>
</TABLE>
<PAGE>
Bridges Investment Fund, Inc. -41- September 25, 2000
Statement -- Part B
<TABLE>
BRIDGES INVESTMENT FUND, INC.
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
<CAPTION>
Amount Amount
<S> <C> <C>
INVESTMENT INCOME
Interest $406,559
Dividends (Net of foreign withholding taxes
of $2,372) 434,888
Total Investment Income $ 841,447
EXPENSES
Management fees $ 279,316
Custodian fees 36,932
Insurance and Other Administrative Fees 26,322
Bookkeeping services 18,578
Printing and supplies 13,279
Professional services 10,820
Dividend disbursing and transfer
agent fees 15,738
<PAGE>
Computer programming 5,000
Taxes and licenses 1,064
Total Expenses $ 407,049
NET INVESTMENT INCOME $ 434,398
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net realized gain on transactions in
investment securities $2,401,788
Net increase in unrealized
appreciation of investments 16,580,965
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS $18,982,753
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $19,417,151
<FN>The accompanying notes to financial statements
are an integral part of this statement.
<PAGE>
</TABLE>
<PAGE>
Bridges Investment Fund, Inc. -42- September 25, 2000
Statement -- Part B
<TABLE>
BRIDGES INVESTMENT FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1999 AND 1998
<CAPTION>
1999 1998
<S> <C> <C>
INCREASE IN NET ASSETS
Operations -
Net investment income $ 434,398 $ 573,399
Net realized gain on transactions
in investment securities 2,401,788 2,816,870
Net increase in unrealized
appreciation of investments 16,580,965 6,973,448
Net increase in net assets
resulting from operations $ 19,417,151 $10,363,717
Net equalization credits 3,190 9,098
Distributions to shareholders from -
Net investment income (434,398) (573,399)
<PAGE>
Net realized gain from investment
transactions (1,343,009) (2,810,407)
Return of capital (6,815) (9,316)
Net capital share transactions 3,666,452 4,805,885
Total increase in Net Assets $ 21,302,571 $11,785,578
NET ASSETS:
Beginning of year $ 48,433,113 $36,647,535
End of year $ 69,735,684 $48,433,113
<FN>The accompanying notes to financial statements
are an integral part of these statements.
</TABLE>
<PAGE>
Bridges Investment Fund, Inc. -43- September 25, 2000
Statement -- Part B
BRIDGES INVESTMENT FUND, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(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
<PAGE>
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>
1999 1998 Net Change
<S> <C> <C> <C>
Net unrealized appreciation
(depreciation):
Aggregate gross unrealized
appreciation
on securities $39,880,716 $23,102,283
Aggregate gross unrealized
depreciation
on securities (529,740) (332,272)
Net $39,350,976 $22,770,011 $16,580,965
</TABLE>
<PAGE>
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. The gain computed on the basis of average cost
would have been substantially the same as that reflected in the
accompanying statement of operations.
Bridges Investment Fund, Inc. -44- September 25, 2000
Statement -- Part B
B. Federal Taxes -
The Fund intends to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and not be
subject to federal income tax. Therefore, no income tax provision is
required. The Fund also intends to distribute its taxable net
investment income and realized gains, if any, to avoid the payment of
any federal excise taxes.
The character of distributions made during the year from net
investment income or net realized gains may differ from its ultimate
characterization for federal income tax purposes. In addition, due to
the timing of dividend distributions, the fiscal year in which amounts
are distributed may differ from the year that the income or realized
gains or losses were recorded by the Fund.
C. Distribution To Shareholders -
The Fund accrues income dividends to shareholders on a quarterly
basis as of the ex-dividend date. Distributions of net realized gains
are made on an annual basis to shareholders as of the ex-dividend
date.
<PAGE>
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.
E. Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
(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 of 1/8 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
<PAGE>
Adviser. These officers do not receive any compensation from the Fund
other than that which is received indirectly through the Investment
Adviser.
Bridges Investment Fund, Inc. -45- September 25, 2000
Statement -- Part B
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. There were no amounts
reimbursed in the year ended December 31, 1999.
(3) DIVIDEND DISBURSING AND TRANSFER AGENT
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.
<PAGE>
(4) SECURITY TRANSACTIONS
The cost of long-term investment purchases during the years ended
December 31, was:
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
United States government obligations $ -- $ --
Other Securities 9,166,680 9,631,883
Total Cost $9,166,680 $9,631,883
</TABLE>
Net proceeds from sales of long-term investments during the years
ended December 31, were:
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
United States government obligations $ 200,500 $ 200,000
Other Securities 8,675,466 9,280,532
Total Net Proceeds $8,875.966 $9,480,532
<PAGE>
</TABLE>
(5) NET ASSET VALUE
The net asset value per share represents the effective price for all
subscriptions and redemptions.
Bridges Investment Fund, Inc. -46- September 25, 2000
Statement -- Part B
(6) CAPITAL STOCK
Shares of capital stock issued and redeemed are as follows:
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
Shares sold 123,704 108,559
Shares issued to shareholders in
reinvestment of net investment
income and realized gain from
security transactions 35,210 87,751
<PAGE>
158,914 196,310
Shares redeemed 64,491 45,397
Net increase 94,423 150,913
Value of capital stock issued and redeemed is as follows:
<CAPTION>
1999 1998
<S> <C> <C>
Shares sold $4,777,640 $3,444,495
Shares issued to shareholders in
reinvestment of net investment
income and realized gain from
security transactions 1,435,313 2,800,423
$6,212,953 $6,244,918
Shares redeemed 2,546,501 1,439,033
Net increase $3,666,452 $4,805,885
</TABLE>
(7) DISTRIBUTION TO SHAREHOLDERS
On December 7, 1999 a cash distribution was declared from net
investment income accrued through December 31, 1999. This distribution was
ultimately calculated as $.089 per share aggregating $134,226. The
<PAGE>
dividend will be paid on January 24, 2000, to shareholders of record on
December 31, 1999.
Bridges Investment Fund, Inc. -47- September 25, 2000
Statement -- Part B
<TABLE>
FINANCIAL HIGHLIGHTS*
Per share income and capital changes for a share outstanding for each
of the last five years were:
<CAPTION>
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $34.26 $29.02 $24.56 $21.54 $17.10
Income From Investment Operations
Net Investment Income $ .30 $ .44 $ .51 $ .55 $ .58
Net Gains or (Losses) on Securities
(both realized and unrealized) 12.89 7.36 4.77 3.28 4.63
Total From Investment Operations $13.19 $ 7.80 $ 5.28 $ 3.83 $ 5.21
Less Distributions
Dividends from net investment income $ (.30) $ (.44) $ (.51) $ (.55) $ (.58)
Distributions from capital gains (.91) (2.12) (.31) (.26) (.19)
Total Distributions $(1.21) $(2.56) $ (.82) $ (.81) $ (.77)
Net Asset Value, End of Period $46.24 $34.26 $29.02 $24.56 $21.54
<PAGE>
Total Return 38.90% 27.48% 22.33% 18.06% 30.96%
Ratios/Supplemental Data
Net Assets, End of Period
(in thousands) $69,736 $48,433 $36,648 $29,249 $24,052
Ratio of Expenses to Average
Net Assets** .73% .77% .81% .87% .89%
Ratio of Net Investment Income to
Average Net Assets **<F1> .78% 1.37% 2.64% 3.23% 3.80%
Portfolio Turnover Rate 16% 24% 8% 8% 7%
<FN>* Per share income and capital change data is computed using the weighted
average number of shares outstanding method.
<F1>** Average net asset data is computed using monthly net asset value figures.
</TABLE>
<PAGE>
PART C
OTHER INFORMATION
__________________________________________________________________________
OTHER INFORMATION Bridges Investment Fund, Inc. CAPITAL STOCK
September 25, 2000 8401 West Dodge Road
Omaha, Nebraska 68114
402-397-4700
__________________________________________________________________________
Contents Page No.
Item 23. Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . 2-5
Item 24. Persons Controlled by or Under Common Control with the Fund .5
Item 25. Indemnification . . . . . . . . . . . . . . . . . . . . . . 5-6
Item 26. Business and Other Connections of Investment Adviser . . . .6-8
Item 27. Principal Underwriters . . . . . . . . . . . . . . . . . . . 8
Item 28. Location of Accounts and Records . . . . . . . . . . . . . . 8
Item 29. Management Services . . . . . . . . . . . . . . . . . . . . .8
Item 30. Undertakings . . . . . . . . . . . . . . . . . . . . . . . . 8
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9-10
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 February 25, 2000, 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 September 25, 2000.
Bridges Investment Fund, Inc. 2 September 25, 2000
Other Information -- Part C
XV. Item 23. Exhibits
(a) The Fund Articles of Incorporation, filed with the Form N-8B-1
and amendments thereto, in File No. 811-1209, are hereby
incorporated by reference.
(b) (i) The Fund By-Laws, filed with the Form N-8B-1 and amendments
thereto, in File No. 811-1209, are hereby incorporated
reference.
(ii) Amendment to Article III, Section 1 of Fund By-Laws increasing
the number of Fund Directors from 11 to 14, Exhibit 23 (b)(ii)
to Form N-1A, Amendment No. 27, filed April 19, 1999, is hereby
incorporated by reference.
(c) (i) The Specimen Stock Certificate, filed with the Form S-5 in File
No. 2-21600, is hereby incorporated by reference.
(ii) Account Application Form (Revision 10-25-99) filed as Exhibit
23 (c)(ii) to Form N-1A, Amendment No. 43, filed February 25,
2000, is hereby incorporated by reference.
(d) 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.
(e) Underwriting contracts: Not applicable.
(f) Bonus or profit sharing contracts: Not applicable.
(g) (i) 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.
(ii) Custody agreement between Bridges Investment Fund, Inc. and the
First National Bank of Omaha dated April 23, 1997, effective on
July 1, 1997, Exhibit 26 to Form N-1A, Amendment No. 25, filed
April 28, 1998, is hereby incorporated by reference.
Bridges Investment Fund, Inc. 3 September 25, 2000
Other Information -- Part C
Other Material Contracts
(h) Copies of the model plans used by the Fund to establish
retirement plans are hereby incorporated by reference as
subparagraphs (i) through (ix) as follows:
(i) 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.
(ii) Amended and Restated Standard Retirement Plan, including
Application Forms, Participant Request For Distribution Forms,
and Designation of Beneficiary Forms, and the Standard
Custodial Agreement, Exhibit 24(i) to Form N-1A, Amendment No.
21, filed February 24, 1994, is hereby incorporated by
reference.
(iii) Amended and Restated Standard Retirement Plan, corrected to
final text approval by the Internal Revenue Service on July 31,
1990, Exhibit 24(j) to Form N-1A Amendment No. 18, filed
February 22, 1991, is hereby incorporated by reference.
(iv) Amended and Restated Individual Retirement Account Custodial
Agreement corrected to final text approval the Internal Revenue
Service on June 11, 1993, Exhibit 24(k), to Form N-1A,
Amendment No. 21, filed February 24, 1994, is hereby
incorporated by reference.
(v) Amendment to Bridges Investment Fund, Inc. Standard Retirement
Plan effective January 1, 1994, as adopted on March 29, 1994,
Exhibit 24(l) to Form N-1A, Amendment No. 22, filed February
23, 1995, is hereby incorporated by reference.
(vi) Model Amendment for Qualified Military Service, Model Amendment
for SIMPLE 401(k) Provisions, and a new Profit Sharing Plan
Application Form reflecting the SIMPLE 401(k) Provisions at
Part III all related to the Standard Retirement Plan _ No. 001,
Bridges Investment Fund, Inc. 4 September 25, 2000
Other Information -- Part C
Exhibit 14(m) to Form N-1A, Amendment No. 25, filed April 28,
1998, is hereby incorporated by reference.
(vii) Bridges Investment Fund, Inc. SIMPLE Individual Retirement
Custodial Account Master Plan, including Application Form,
Custodial Agreement, Disclosure Statement, Notice to Eligible
Employees, Summary Description, Salary Reduction Agreement,
Beneficiary Designation, and Request for Distribution Form,
Exhibit 14(n) to Form N-1A, Amendment No. 25, filed April 28,
1998, is hereby incorporated by reference.
(viii) Roth Individual Retirement Custodial Account (IRS Form 5305-
RA) with standardized text Attachment for Article IX, Exhibit
14(o) to Form N-1A, Amendment No. 25, filed April 28, 1998, is
hereby incorporated by reference.
(ix) Education Individual Retirement Custodial Account (IRS Form
5305-EA) with standardized text Attachment for Article XI,
Exhibit 14 (p) to Form N-1A, Amendment No. 25, filed April 28,
1998, is hereby incorporated by reference.
(x) Agreement dated July 14, 1987, to appoint Bridges Investor
Services, Inc. as Dividend Disbursing and Transfer Agent,
Exhibit 19 to Form N-1A, Amendment No. 15, filed February 25,
1988, is hereby incorporated by reference.
(xi) 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,
Exhibit 21 to Form N-1A, Amendment No. 15, filed February 25,
1988, is hereby incorporated by reference.
(i) (i) The opinion and consent of counsel dated July 12, 1963, as to
the legality of securities issued, Exhibit F of the original
Form S-5 in File No. 2-21600, are hereby incorporated by
reference.
Bridges Investment Fund, Inc. 5 September 25, 2000
Other Information -- Part C
(ii) The opinion and consent of legal counsel, February 25, 1988,
as to the legality of securities issued, Exhibit 22, to Form
N-1A, Amendment No. 16, filed February 24, 1989, is hereby
incorporated by reference.
(j) Consent of KPMG LLP dated February 25, 2000, filed as Exhibit
23 (j) to Form N-1A, Amendment No. 43, filed February 25, 2000
is hereby incorporated by reference.
(k) Omitted Financial Statements: Not applicable.
(l) Initial Capital Agreements: Not applicable.
(m) Rule 12b-1 Plan: Not applicable.
(n) Financial Data Schedule meeting requirements of SEC Rule 483
filed as Exhibit 23 (n) to Form N-1A, Amendment No. 43, filed
February 25, 2000 is hereby incorporated by reference.
(o) Rule 18f-3 Plan: Not applicable.
(p) Restated Code of Ethics of Bridges Investment Fund, Inc. &
Bridges Investment Counsel, Inc. as adopted October 12, 1999,
is filed herewith as Exhibit 23 (p).
Item 24. Persons Controlled by or under Common Control with Registrant
Not applicable
Item 25. Indemnification
Under the Nebraska Business Corporation Act, as enacted in 1995, a
Nebraska Corporation, such as the Fund, is required to indemnify a
director and officer who was wholly successful in the defense of any
proceeding to which such person was a party because of his or her
position as a director or officer against reasonable expenses,
including attorney's fees, incurred in connection with such
proceeding. A Nebraska Corporation, such as the Fund, is permitted,
Bridges Investment Fund, Inc. 6 September 25, 2000
Other Information -- Part C
but not required, to indemnify a director or officer against liability
if such person conducted himself or herself in good faith, and the
director or officer reasonably believed that his or her conduct was in
the best interests of the corporation. The Fund has never been
requested to provide indemnification by a director or officer, nor has
the Fund taken any action or made any offer to indemnify a director or
officer of the Fund.
Item 26. 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 Chairman and Chief
Executive Officer 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
Bridges Investment Advisers
8401 West Dodge Road
Omaha, Nebraska 68114
Edson L. Bridges II Managing Director
Bridges Investment Management, Inc.
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 Investments Limited Director
25720 West Dodge Road
Waterloo, Nebraska 68069
Provident Trust Company President and
256 Durham Plaza Director
8401 West Dodge Road
Omaha, Nebraska 68114
Store Kraft Manufacturing Company Director
Beatrice, Nebraska 68310
Bridges Investment Fund, Inc. 7 September 25, 2000
Other Information -- Part C
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
of Mr. Bridges' time. One exception to this statement would be Edson
L. Bridges II, Bridges Investment Advisers, a proprietorship which is
part of Mr. Bridges' principal profession. The other exception is
Provident Trust Company, discussed in more detail below.
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
Bridges Investment Advisers.
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 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
Edson L. Bridges III President
Bridges Investment Management, Inc.
8401 West Dodge Road
Omaha, Nebraska 68114
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 "L" Street
Lincoln, Nebraska 68508
Bridges Investment Fund, Inc. 8 September 25, 2000
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 1998
with assistance to Provident Trust Company for the conduct of its
operations and services. On December 31, 1999, Provident Trust
Company was responsible to 590 customer accounts with assets valued at
in excess of $600 million.
Item 27. Principal Underwriters
Not applicable
Item 28. 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 29. Management Services
Not applicable
Item 30. Undertakings
Not applicable
Bridges Investment Fund, Inc. 9 September 25, 2000
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
485(b) 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 25th day of
September, 2000.
BRIDGES INVESTMENT FUND, INC.
/s/ Edson L. Bridges II______
Edson L. Bridges II, Chairman
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:
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Edson L. Bridges II_ Chairman September 25, 2000
Edson L. Bridges II Date
/s/ Nancy K. Dodge______ Treasurer September 25, 2000
Nancy K. Dodge Date
________________________ Director __________________
Frederick N. Backer Date
/s/ Edson L. Bridges II_ Director September 25, 2000
Edson L. Bridges II Date
/s/ Edson L. Bridges III President September 25, 2000
Edson L. Bridges III Director Date
/s/ N. P. Dodge, Jr.____ Director September 25, 2000
N. P. Dodge, Jr. Date
/s/John W. Estabrook____ Director September 25, 2000
John W. Estabrook Date
/s/ Jon D. Hoffmaster___ September 25, 2000
Jon D. Hoffmaster Director Date
_______________________ Director __________________
John J. Koraleski Date
Bridges Investment Fund, Inc. 10 September 25, 2000
Other Information -- Part C
/s/ Roger A. Kupka_____ Director September 25, 2000_
Roger A. Kupka Date
________________________ Director __________________
Gary L. Petersen Date
/s/ John T. Reed________ Director September 25, 2000
John T. Reed Date
________________________ Director __________________
Roy A. Smith Date
________________________ Director __________________
Janice D. Stoney Date
/s/ L.B. Thomas_________ Director September 25, 2000
L.B. Thomas Date
/s/ John K. Wilson______ Director September 25, 2000
John K. Wilson Date
</TABLE>
<PAGE>
