SEC Registration Nos.
2-56809 and 811-2633
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
Post-Effective Amendment No. 37 XX
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 37 XX
First Variable Rate Fund for Government Income
This filing relates to the addition of a new Class T only
(Exact Name of Registrant as Specified in Charter)
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Address of Principal Executive Offices)
Registrant's Telephone Number: (301) 951-4881
William M. Tartikoff, Esq.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
__ Immediately upon filing __ on (date)
pursuant to paragraph (b) pursuant to paragraph (b)
__ 60 days after filing XX on February 26, 1999
pursuant to paragraph (a) pursuant to paragraph (a)
of Rule 485.
<PAGE>
FRONT COVER PAGE
PROSPECTUS
February 28, 1999
First Variable Rate Fund for Government Income
Calvert First Government Money Market Fund
Class T
Calvert Tax-Free Reserves
Money Market Fund
Class T
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE FEDERAL OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Table of Contents Page
About the Funds
Investment goal _
Investment strategies and risks _
Performance chart _
Fees and expenses _
About the Advisor
Management _
Year 2000 _
Shareholder Guide:
How to Buy Shares _
Other Calvert Group Features _
Dividends, Capital Gains and Taxes _
How to Sell Shares _
Financial Highlights _
<PAGE>
Fundamental Goals - Investment Objectives
Calvert First Government Money Market Fund
Calvert First Government Money Market Fund ("CFGMMF") is a U.S.
Government-only money market fund that seeks to earn the highest possible
yield consistent with safety, liquidity, and preservation of capital. In
pursuing its objective, CFGMMF invests only in U.S. Government-backed
obligations, including such obligations subject to repurchase agreements with
recognized securities dealers and banks. CFGMMF seeks to maintain a constant
net asset value of $1.00 per share.
CFGMMF offers five classes: O, B, C and I, which are offered in separate
prospectuses, and Class T, offered in this prospectus to investors with
brokerage accounts at The Advisors Group, Ltd. ("TAG").
Calvert Tax-Free Reserves Money Market Fund
Calvert Tax-Free Reserves Money Market Portfolio ("CTFR MM") seeks to earn the
highest interest income exempt from federal income taxes as is consistent with
prudent investment management, preservation of capital, and the quality and
maturity characteristics of CTFR MM. CTFR MM seeks to maintain a constant net
asset value of $1.00 per share.
CTFR MM offers three classes: O and I, which are each offered in separate
prospectuses, and Class T, offered in this prospectus to investors with
brokerage accounts at TAG.
Principal Investment Strategies
CFGMMF assets are invested primarily in Top-Tier Securities, such as:
obligations issued by the U.S. Treasury, such as U.S. Treasury bills,
notes and bonds, supported by the full faith and credit of the U.S.
Government;
Securities issued by the U.S. Government, its agencies and
instrumentalities;
repurchase agreements; and
variable-rate demand notes.
CTFR MM assets are invested primarily in a diversified portfolio of municipal
obligations whose interest is exempt from federal income tax. At least 80% of
CTFR MM's annual income will be tax-exempt from federal taxes. CTFR MM invests
in:
high quality variable and floating rate demand notes and/or municipal
obligations;
municipal bonds and notes and tax-exempt commercial paper;
short-term fixed-rate obligations with remaining maturities of one year
or less;
CFGMMF and CTFR MM (the "Funds"): Rule 2a-7 under the Investment Company Act
of 1940 applies to every money market fund to ensure that a money market fund
invests only in high quality obligations, takes minimal credit risks, and has
a stable price per share. The Funds invests in accordance with Rule 2a-7 under
the Investment Company Act of 1940, as amended.
Risks of investing
The yield of each Fund will vary daily, depending on market interest rates,
and tends to follow the same direction as the rates.
All fixed income instruments are subject to interest-rate risk; that is, if
the market interest rates rise, the current price or value of a bond and the
yield of CTFR MM will decline.
Dividends paid by each Fund will fluctuate as interest rates and net
investment income fluctuate.
Investments in obligations not guaranteed by the full faith and credit of the
U.S. Government are subject to the ability of the issuer to make payment at
maturity.
Purchasing obligations for future delivery or on a "when-issued" basis may
increase a Fund's overall investment exposure and involves a risk of loss if
the value of the securities declines prior to the settlement date. The
transactions are fully secured at all times.
There is no limitation on the percentage of CTFR MM's assets that may be
invested in unrated obligations; such obligations may be less liquid than
rated obligations of comparable quality.
The sudden credit deterioration of a holding could cause the yield or overall
value of a Fund to decrease. The Fund limits the amount it invests in any one
issuer to lessen exposure.
Variable rate obligations lessen the capital fluctuations usually inherent in
fixed income investments. This diminishes the risk of capital depreciation of
investment securities and, consequently, of CTFR MM shares.
For liquidity purposes or pending the investment of the proceeds of the sale
of its shares, CTFR MM may invest in and derive up to 20% of its income from
taxable short-term money market type investments. Interest earned from such
taxable investments will be taxable as ordinary income unless you are
otherwise exempt from taxation.
An investment in the Funds is not a deposit of any bank and is neither insured
nor guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although the Funds seek to preserve the value of your
investment at $1.00 per share, it is possible to lose money by investing in
the Funds.
Bar Charts and Performance Tables
The bar charts and tables below show the annual returns and its long-term
performance by calendar year for Class O of each of the Funds. The charts
shows how the performance has varied from year to year. The tables compare
Class O returns over time to the Lipper U.S. Government Money Market Funds
Index for CFGMMF, and the Lipper Tax-Exempt Money Market Funds Index for
CTFRMM. Each index is a composite index of the annual return of mutual funds
that have similar investment goals. Each Fund's past performance does not
necessarily indicate how it will perform in the future. Please note that
performance for Class T is not shown since it was not available for either
Fund during the time periods shown.
Bar Chart - CFGMMF
1989 _.__% 1994 _.__%
1990 _.__% 1995 _.__%
1991 _.__% 1996 _.__%
1992 _.__% 1997 _.__%
1993 _.__% 1998 _.__%
Best Quarter (of periods shown) Q_ '__ _.__%
Worst Quarter (of periods shown) Q_ '__ _.__%
Bar Chart - CTFR MM
1989 _.__% 1994 _.__%
1990 _.__% 1995 _.__%
1991 _.__% 1996 _.__%
1992 _.__% 1997 _.__%
1993 _.__% 1998 _.__%
Best Quarter (of periods shown) Q_ '__ _.__%
Worst Quarter (of periods shown) Q_ '__ _.__%
Average annual total returns for the periods ended December 31, 1998
1 year 5 years 10 years
Calvert First Government Class O __% __% __%
Lipper U.S. Government Money
Market Funds Index __% __% __%
1 year 5 years 10 years
CTFR Money Market Class O __% __% __%
Lipper Tax-Exempt Money
Market Funds Index __% __% __%
For current yield information, call 1-800-368-2745, or visit Calvert's website
at: www.calvertgroup.com.
Fees and Expenses of the Funds
These tables describe the fees and expenses you may pay if you buy and hold
shares of Class T of each Fund.
A. Shareholder Fees
(fees paid directly from your investment)
CFGMMF CTFR MM
Maximum Sales Load on Purchases None None
Maximum Deferred Sales Load None None
Maximum Sales Load on Reinvested Dividends None None
Redemption Fees None None
Exchange Fee None None
B. Estimated Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)
CFGMMF CTFR MM
Management Fees 0.50% 0.46%
Rule 12b-1 and/or Service Fees 0.25% 0.25%
Other Expenses 0.19% 0.14%
Total Fund Operating Expenses 0.94% 0.85%
C. Example:
This example is intended to help you compare the cost of investing in a Fund
with the cost of investing in other mutual funds. The example assumes that:
You invest $10,000 in Class T of a Fund for the time periods
indicated;
You redeem all shares at the end of the periods;
Your investment has a 5% return each year; and
The Fund's operating expenses remain the same.
Although your actual costs may be higher or lower, under these
assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
CFGMMF $87 $271 $471 $1,049
CTFR MM $96 $300 $520 $1,155
Management and Advisory Fees
Calvert Asset Management Company, Inc. ("CAMCO") is the investment advisor for
each Fund. CAMCO has been managing mutual funds since 1976, and is a
subsidiary of Calvert Group, Ltd. CAMCO currently advises 25 Calvert funds,
including the first and largest family of socially screened funds. CAMCO is
located at 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. As
of December 31, 1998, it had over $6 billion in assets under management.
CAMCO provides the Funds with investment supervision and management;
administrative services and office space; and furnishes executive and other
personnel to the Funds. CAMCO also pays the salaries and fees of all Trustees
who are affiliated persons. CAMCO may pay certain advertising and promotional
expenses of the Funds. Pursuant to the Investment Advisory Agreement, CAMCO is
entitled to an annual advisory fee of 0.25% of the average daily net assets of
CFGMMF. The CTFR MM Investment Advisory Agreement entitles CAMCO to receive an
annual advisory fee of 0.25% of the first $500 million of average daily net
assets, 0.20% of the next $500 million, and 0.15% on assets of $1 billion or
more. CAMCO may voluntarily waive a portion of its advisory fee.
A Word About the Year 2000 (Y2K) and Our Computer Systems
Like other mutual funds, Calvert and its service providers use computer
systems for all aspects of our business -- processing shareholder and fund
transactions, fund accounting, executing trades, and pricing securities, just
to name a few. Many current software programs cannot distinguish between the
year 2000 and the year 1900. This can cause problems with retirement plan
distributions, dividend payment software, transaction software, and numerous
other areas that could impact the Funds. Calvert has been reviewing all of its
computer systems for Y2K compliance. CAMCO, the underwriter, transfer agent,
and custodians have advised the Funds that they have been actively working on
any necessary changes to their computer systems to prepare for Y2K. Each of
the entities named expects that their systems and those of their outside
service providers will be Y2K compliant, and the Funds do not anticipate a
negative impact. For more information, please visit our website at
www.calvertgroup.com.
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SHAREHOLDER GUIDE
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HOW TO BUY SHARES
Please contact your local office of The Advisors Group, Ltd. ("TAG") to open
your money market account. All transactions will be processed electronically
through the National Financial Proprietary Money Market Sweep Program on
behalf of TAG.
There is no minimum for initial investments and no minimum for subsequent
investments, provided you have a TAG brokerage account.
Because you are purchasing shares through a program of services offered by
TAG, a registered broker/dealer and investment advisor, you should read the
TAG program materials together with this Prospectus. Certain account features
have been modified for this program, and TAG may impose charges for their
services.
Important - How Shares are Priced
The price of shares is based on each Fund's net asset value ("NAV"). NAV is
computed per class by adding the value of a Fund's holdings plus other assets,
subtracting liabilities, and then dividing the result by the number of shares
outstanding.
Each Fund is valued according to the "amortized cost" method, which is
intended to stabilize the NAV at $1 per share. If market quotations are not
readily available, securities are valued by a method that the Fund's Board of
Trustees/Directors believes accurately reflects fair value.
The NAV is calculated as of the close of each business day, which coincides
with the closing of the regular session of the New York Stock Exchange
("NYSE") (normally 4 p.m. ET). Each Fund is open for business each day the
NYSE is open. Please note that there are some federal holidays, such as
Columbus Day and Veterans Day, when the NYSE is open and each Fund is open,
but no purchases may be made due to the closure of the banking system.
When Your Account Will Be Credited
Your purchase will be processed at the NAV calculated after your order is
received and accepted. Electronic sweeps into an account begin earning
dividends the next business day.
Each Fund reserves the right to suspend the offering of shares for a period of
time or to reject any specific purchase order.
DIVIDENDS, CAPITAL GAINS AND TAXES
Each Fund accrues dividends daily from its net investment income, and pays the
dividends monthly. Net investment income consists of interest income, net
short-term capital gains, if any, and dividends declared and paid on
investments, less expenses. Distributions of net short-term capital gains
(treated as dividends for tax purposes) and net long-term capital gains, if
any, are normally paid once a year; however, the Funds do not anticipate
making any such distributions unless available capital loss carryovers have
been used or have expired.
Dividend payment options
Dividends and any distributions are automatically reinvested in the same Fund
at NAV (without sales charge), unless you elect to have amounts of $10 or more
paid in cash (by check).
Federal Taxes
In January, TAG will mail Form 1099-DIV, indicating taxable dividends and any
capital gain distributions paid to you during the past year. Generally,
dividends and distributions are taxable in the year they are paid. However,
any dividends and distributions paid in January but declared during the prior
three months are taxable in the year declared. Dividends and distributions are
taxable to you regardless of whether they are taken in cash or reinvested.
Dividends, including short-term capital gains, are taxable as ordinary income.
Distributions from long-term capital gains are taxable as long-term capital
gains, regardless of how long you have owned shares.
Other Tax Information
In addition to federal taxes for Calvert First Government Money Market Fund,
you may be subject to state or local taxes on your investment, depending on
the laws in your area. You will be notified to the extent, if any, that
dividends reflect interest received from US government securities. Such
dividends may be exempt from certain state income taxes.
Taxpayer Identification Number
If we do not have your correct Social Security or Taxpayer Identification
Number ("TIN") and a signed certified application or Form W-9, Federal law
requires us to withhold 31% of your reportable dividends, and possibly 31% of
certain redemptions. In addition, you may be subject to a fine by the Internal
Revenue Service.
HOW TO SELL SHARES
You may redeem all or a portion of your shares on any day the Funds are open
for business, provided the amount requested is not on hold. Your shares will
be redeemed at the next NAV calculated after your redemption request is
received and accepted. You will receive dividends through the date the request
is received and processed. The proceeds will normally be sent to you on the
next business day, but if making immediate payment could adversely affect your
Fund, it may take up to seven (7) days to make payment. The Funds have the
right to redeem shares in assets other than cash for redemption amounts
exceeding, in any 90-day period, $250,000 or 1% of the net asset value of the
Fund, whichever is less. When the NYSE is closed (or when trading is
restricted) for any reason other than its customary weekend or holiday
closings, or under any emergency circumstances as determined by the Securities
and Exchange Commission, redemptions may be suspended or payment dates
postponed. Please note that there are some federal holidays such as Columbus
Day and Veterans Day, when the NYSE is open and each Fund is open, but
redemptions cannot be made due to the closure of the banking system.
BY TELEPHONE
You may redeem shares from your account by telephone and have your money sent
by check, electronically transferred, or wired to a bank you have previously
authorized by contacting your local office of TAG.
CHECKWRITING
Checkwriting will be offered through TAG. The checkwriting features vary,
depending on what you choose when you open the money market sweep account with
TAG. Please see the TAG program materials for information.
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To Open an Account:
800-777-1500
Performance and Prices:
800-777-1500
Service for Existing Accounts:
800-777-1500
Registered, Certified or
Overnight Mail:
The Advisors Group, Ltd.
7315 Wisconsin Avenue
Bethesda, Maryland 20814
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
<PAGE>
Outside Back Cover Page
Statements of Additional Information ("SAIs") (dated February 28, 1999) for
the Funds have been filed with the Securities and Exchange Commission and is
incorporated by reference. Additional information about each Fund's
investments is available in each Fund's annual and semi-annual reports to
shareholders. The SAIs and each Fund's annual and semi-annual reports are
available, without charge and upon request, from the Funds at 800-368-2750.
Information about the Funds (including the SAIs) can be reviewed at the
Commission's Public Reference Room in Washington, D.C. Information on the
operation of the public reference room may be obtained by calling the
Commission at 1-800-SEC-0330. Reports and other information about the Funds
are available on the Commission's internet site at http://www.sec.gov. Copies
of this information may be obtained, by payment of a duplicating fee, by
writing the Public Reference Section of the Commission, Washington, D.C.
20549-6009.
811-2633 First Variable Rate Fund
811-3101 Calvert Tax-Free Reserves
<PAGE>
First Variable Rate Fund:
Calvert First Government Money Market Fund
Statement of Additional Information
February 28, 1999
INVESTMENT ADVISOR
Calvert Asset Management Company, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
SHAREHOLDER SERVICE
Calvert Shareholder Services, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
TRANSFER AGENT
National Financial Data Services, Inc.
1004 Baltimore
6th Floor
Kansas City, Missouri 64105
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers
250 West Pratt Street
Baltimore, Maryland 21201
TABLE OF CONTENTS
Investment Objective and Strategy 1
Investment Restrictions 2
Dividends and Distributions 2
Tax Matters 2
Net Asset Value 3
Calculation of Yield 4
Advertising 4
Purchases and Redemption of Shares 4
Trustees and Officers 5
Investment Advisor 7
Administrative Services 8
Transfer and Shareholder Servicing Agent 8
Portfolio Transactions 8
Independent Accountants and Custodians 9
Method of Distribution 9
General Information 10
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION-February 28, 1999
FIRST VARIABLE RATE FUND:
CALVERT FIRST GOVERNMENT MONEY MARKET FUND
4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814
New Account Information
(800) 368-2748
(301) 951-4820
Shareholder Services
(800) 368-2745
Broker Services
(800) 368-2746
(301) 951-4850
TDD for the Hearing- Impaired
(800) 541-1524
This Statement of Additional Information is not a prospectus.
Investors should read the Statement of Additional Information in conjunction
with the First Variable Rate Fund Calvert First Government Money Market Fund
(the "Fund") Prospectus, dated February 28, 1999 for Class T, March 31, 1998
for Classes O, B, and C, and September 15, 1998 for the Institutional Class,
which may be obtained free of charge by writing or calling the Fund at the
telephone numbers listed above.
The audited financial statements included in the Fund's Annual Report to
Shareholders dated December 31, 1998 are expressly incorporated by reference
and made a part of this Statement of Additional Information. A copy of the
Annual Report may be obtained free of charge by writing or calling the Fund.
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INVESTMENT OBJECTIVE AND STRATEGY
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In pursuing its objective of earning the highest possible yield
consistent with safety, liquidity, and preservation of capital, the Fund
invests solely in debt obligations issued or guaranteed by the United States,
its agencies or instrumentalities, assignments of interest in such
obligations, and commitments to purchase such obligations ("U.S.
Government-backed obligations"). The Fund may invest in U.S. Government-backed
obligations subject to repurchase agreements with recognized securities
dealers and banks.
The Fund engages in repurchase Agreements in order to earn a higher
rate of return than it could earn simply by investing in the obligation which
is the subject of the repurchase agreement. Repurchase agreements are not,
however, without risk. If the seller were to become bankrupt, the Fund might
realize a loss if the value of the underlying security did not equal or exceed
the repurchase price. In order to minimize the risk of investing in repurchase
agreements, the Fund engages in such transactions only with recognized
securities dealers and banks and in all instances holds underlying securities
with a value equal to the total repurchase price such dealer or bank has
agreed to pay. Repurchase agreements are always for periods of less than one
year and no more than 10% of the Fund's assets may be invested in repurchase
agreements not terminable within seven days.
Although all the securities purchased by the Fund are
Government-backed as to principal or secured by such securities, some of the
types of Government securities the Fund buys may be sold at a premium which is
not backed by a Government guarantee. The premiums are amortized over the life
of the security; however, if a security should default or be prepaid, the Fund
could realize as a loss the unamortized portion of such premium.
In the Government-guaranteed loan market, most purchases of new
issues are made under firm (forward) commitment agreements. Purchases of
long-term fixed rate debt securities under such agreements can involve risk of
loss due to changes in the market rate of interest between the commitment date
and the settlement date. Forward commitment agreements for variable rate
securities, unlike such agreements for fixed rate securities, are stable in
value; the Fund's Advisor believes the risk of loss under forward commitment
agreements involving variable rate obligations to be insignificant.
All the Fund's investments maturing in more than one year will have a
variable rate feature under which the yield is adjusted periodically based
upon changes in money market rates such as prime. Such adjustments will be
made at least semi-annually. Variable rate securities minimize the wide
fluctuations in capital value that represent the traditional drawback to such
long-term investments; but this also means that should interest rates decline,
the amount of return paid by the Fund will decline and the Fund will forego
the opportunity of capital appreciation on its portfolio securities.
The foregoing objective and policies may not be altered without the
prior approval of the holders of a majority of the outstanding shares of the
Fund. There is, of course, no assurance that the Fund will be successful in
meeting the above investment objective.
The Fund does not intend to concentrate 25% or more of the value of
its total assets in any one industry, except that the Fund reserves the
freedom of action to concentrate its investments in government securities and
certain bank instruments as detailed above.
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INVESTMENT RESTRICTIONS
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Fundamental Investment Restrictions
The Fund has adopted the following fundamental investment
restrictions. These restrictions cannot be changed without the approval of the
holders of a majority of the outstanding shares of the Fund.
(1) The Fund may not make any investment inconsistent with
its classification as a diversified investment company under
the 1940 Act.
(2) The Fund may not concentrate its investments in the
securities of issuers primarily engaged in any particular
industry (other than securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities and
repurchase agreements secured thereby), or domestic bank
money market instruments.
(3) The Fund may not issue senior securities or borrow
money, except from banks for temporary or emergency purposes
and then only in an amount up to 33 1/3% of the value of its
total assets or as permitted by law and except by engaging
in reverse repurchase agreements, where allowed. In order to
secure any permitted borrowings and reverse repurchase
agreements under this section, the Fund may pledge, mortgage
or hypothecate its assets.
(4) The Fund may not underwrite the securities of other
issuers, except as allowed by law or to the extent that the
purchase of obligations in accordance with the Fund's
investment objective and policies, either directly from the
issuer, or from an underwriter for an issuer, may be deemed
an underwriting.
(5) The Fund may not invest directly in commodities or real
estate, although it may invest in securities which are
secured by real estate or real estate mortgages and
securities of issuers which invest or deal in commodities,
commodity futures, real estate or real estate mortgages.
(6) The Fund may not make loans, other than through the
purchase of money market instruments and repurchase
agreements or by the purchase of bonds, debentures or other
debt securities, or as permitted by law. The purchase of all
or a portion of an issue of publicly or privately
distributed debt obligations in accordance with the Fund's
investment objective, policies and restrictions, shall not
constitute the making of a loan.
Nonfundamental Investment Restrictions
The Board of Trustees has adopted the following nonfundamental
investment restrictions. A nonfundamental investment restriction can be
changed by the Board at any time without a shareholder vote.
(1) The Fund may not purchase common stocks, preferred stocks,
warrants, or other equity securities.
(2) The Fund does not intend to make any purchases of securities if
borrowing exceeds 5% of total assets.
(3) The Fund may not sell securities short.
(4) The Fund may not write or purchase put or call options.
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DIVIDENDS AND DISTRIBUTIONS
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Dividends from the Fund's net investment income are declared daily
and paid monthly. Net investment income consists of the interest income earned
on investments (adjusted for amortization of original issue or market discount
or premium), less expenses. Realized and unrealized gains and losses are not
included in net investment income. Net short-term capital gains will be
distributed once each year, although the Fund may distribute them more
frequently if necessary in order to maintain the Fund's net asset value at
$1.00 per share. Distributions of net capital gains, if any, are normally
declared and paid by the Fund once a year; however, the Fund does not intend
to make any such distributions from securities profits unless available loss
carryovers, if any, have been used or have expired. Dividends and
distributions may differ among the classes.
Purchasers of Fund shares begin receiving dividends from the date
federal funds are received by the Fund. Purchases by bank wire received by the
Fund's custodian prior to 12:30 p.m., Eastern time, represent immediately
available federal funds. Shareholders redeeming shares by telephone,
electronic funds transfer or written request will receive dividends through
the date that the redemption request is received; shareholders redeeming
shares by draft will receive dividends up to the date such draft is presented
to the Fund for payment.
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TAX MATTERS
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In 1997, the Fund did qualify and in 1998, the Fund intends to
qualify as a "regulated investment company" under Subchapter M of the Internal
Revenue Code, as amended. By so qualifying, the Fund will not be subject to
federal income taxes, nor to the federal excise tax imposed by the Tax Reform
Act of 1986, to the extent that it distributes its net investment income and
net capital gains.
Dividends of net investment income and distributions of net
short-term capital gains, whether taken in cash or reinvested in additional
shares, are taxable to shareholders as ordinary income and do not qualify for
the dividends received deduction for corporations. Net long-term capital gain
distributions, if any, will generally be includable as long-term capital gain
in the gross income of shareholders who are citizens or residents of the
United States. Whether such realized securities gains and losses are long-or
short-term depends on the period the securities are held by the Fund, not the
period for which the shareholder holds shares of the Fund.
The Fund is required to withhold 31% of any dividends (including
long-term capital gain dividends, if any) if: (a) the shareholder's social
security number or other taxpayer identification number ("TIN") is not
provided or an obviously incorrect TIN is provided; (b) the shareholder does
not certify under penalties of perjury that the TIN provided is the
shareholder's correct TIN and that the shareholder is not subject to backup
withholding under section 3406(a)(1)(C) of the Internal Revenue Code because
of underreporting; or (c) the Fund is notified by the Internal Revenue Service
that the TIN provided by the shareholder is incorrect or that there has been
underreporting of interest or dividends by the shareholder. Affected
shareholders will receive statements at least annually specifying the amount
of dividends withheld.
Shareholders exempt from backup withholding include: corporations;
financial institutions, tax-exempt organizations; individual retirement plans;
the U.S., a state, the District of Columbia, a U.S. possession, a foreign
government, an international organization, or any political subdivision,
agency or instrumentality of any of the foregoing; U.S. registered commodities
or securities dealers; real estate investment trusts; registered investment
companies; bank common trust funds; certain charitable trusts; and foreign
central banks of issue. Non-resident aliens also are generally not subject to
backup withholding but, along with certain foreign partnerships and foreign
corporations, may instead be subject to withholding under section 1441 of the
Internal Revenue Code. Shareholders claiming exemption from backup withholding
should call or write the Fund for further information.
Many states do not tax the portion of the Fund's dividends which is
derived from interest on U.S. Government obligations. The law of the states
varies concerning the tax status of dividends derived from U.S. Government
obligations. Accordingly, shareholders should consult their tax advisors about
the tax status of dividends and distributions from the Fund in their
respective jurisdictions.
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NET ASSET VALUE
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The net asset value per share of the Fund, the price at which shares
are redeemed (and, for Class B or C, less any applicable contingent deferred
sales charge, "CDSC"), is computed by dividing the value of the Fund's total
assets, less its liabilities, by the total number of shares outstanding. Net
asset value is calculated separately for each class. It is determined every
business day at the close of the New York Stock Exchange (generally, 4:00 p.m.
Eastern time), and at such other times as may be appropriate or necessary. The
Fund does not determine net asset value on certain national holidays or other
days on which the New York Stock Exchange is closed: New Year's Day, Martin
Luther King Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, and Christmas Day.
The Fund's assets, including securities subject to repurchase
agreements, are normally valued at their amortized cost which does not take
into account unrealized capital gains or losses. This involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of fluctuating
interest rates on the market value of the instrument. While this method
provides certainty in valuation, it may result in periods during which value,
as determined by amortized cost, is higher or lower than the price that would
be received upon sale of the instrument. During periods of declining interest
rates, the daily yield on shares of the Fund may tend to be higher than a like
computation made by a fund with identical investments utilizing a method of
valuation based upon market prices and estimates of market prices for all of
its portfolio instruments. Thus, if the use of amortized cost by the Fund
resulted in a lower aggregate portfolio value on a particular day, a
prospective investor in the Fund would be able to obtain a somewhat higher
yield than would result from investment in a fund utilizing solely market
values, and existing investors in the Fund would receive less investment
income. The converse would apply in a period of rising interest rates.
Rule 2a-7 under the Investment Company Act of 1940 permits the Fund
to value its assets at amortized cost if the Fund maintains a dollar-weighted
average maturity of 90 days or less and only purchases obligations having
remaining maturities of 13 months or less. Rule 2a-7 further requires, as a
condition of its use, that the Fund invest only in obligations determined by
the Trustees to be of high quality with minimal credit risks and requires the
Trustees to establish procedures designed to stabilize, to the extent
reasonably possible, the Fund's price per share as computed for the purpose of
sales and redemptions at $1.00. Such procedures include review of the Fund's
investment holdings by the Trustees, at such intervals as they may deem
appropriate, to determine whether the Fund's net asset value calculated by
using available market quotations or equivalents deviates from $1.00 per
share. If such deviation exceeds l/2 of 1%, the Trustees will promptly
consider what action, if any, will be initiated. In the event the Trustees
determine that a deviation exists which may result in material dilution or
other unfair results to investors or existing shareholders, the Trustees will
take such corrective action as they regard as necessary and appropriate,
including: the sale of portfolio instruments prior to maturity to realize
capital gains or losses or to shorten average portfolio maturity; the
withholding of dividends or payment of distributions from capital or capital
gains; redemptions of shares in kind; or the establishment of a net asset
value per share based upon available market quotations.
Net Asset Value and Offering Price Per Share, December 31, 1997
($232,024,778/232,513,728 shares) $1.00
- --------------------------------------------------------------------------------
CALCULATION OF YIELD
- --------------------------------------------------------------------------------
Yield is calculated separately by class by dividing the net change
exclusive of capital changes in the value of a share during a particular base
period by the net asset value per share at the beginning of such period and
annualizing the result. Capital changes excluded from the calculation of yield
are: (1) realized gains and losses from the sale of securities, and (2)
unrealized appreciation and depreciation. The Fund's effective yield for a
seven-day period is its annualized compounded average yield during the period,
calculated according to the following formula:
Effective yield = [(Base period return + 1)365/7] - 1
For the seven day period ended December 31, 1998, the Fund's yield and
effective yield were as follows:
Yield Effective Yield
Class O _.__% _.__%
Class B _.__% _.__%
Class C _.__% _.__%
Class I _.__% _.__%
Class T N/A N/A
The Fund's yield fluctuates in response to changes in interest rates
and general economic conditions, portfolio quality, portfolio maturity, and
operating expenses. Yield is not fixed or insured and therefore is not
comparable to a savings or other similar type account. Yield during any
particular time period should not be considered an indication of future yield.
It is, however, useful in evaluating the Fund's performance in meeting its
investment objective. No yield is presented for Class T because it was not
offered as of the fiscal year ending December 31, 1998.
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ADVERTISING
- --------------------------------------------------------------------------------
The Fund or its affiliates may provide information such as, but not
limited to, the economy, investment climate, investment principles,
sociological conditions and political ambiance. Discussion may include
hypothetical scenarios or lists of relevant factors designed to aid the
investor in determining whether the Fund is compatible with the investor's
goals. The Fund may list portfolio holdings or give examples or securities
that may have been considered for inclusion in the Fund, whether held or not.
The Fund or its affiliates may supply comparative performance data
and rankings from independent sources such as Donoghue's Money Fund Report,
Bank Rate Monitor, Money, Forbes, Lipper Analytical Services, Inc., CDA
Investment Technologies, Inc., Wiesenberger Investment Companies Service,
Russell 2000/Small Stock Index, Mutual Fund Values Morningstar Ratings, Mutual
Fund Forecaster, Barron's, The Wall Street Journal, and Schabacker Investment
Management, Inc. Such averages generally do not reflect any front- or back-end
sales charges that may be charged by Funds in that grouping. The Fund may also
cite to any source, whether in print or on-line, such as Bloomberg, in order
to acknowledge origin of information. The Fund may compare itself or its
portfolio holdings to other investments, whether or not issued or regulated by
the securities industry, including, but not limited to, certificates of
deposit and Treasury notes. The Fund, its Advisor, and its affiliates reserve
the right to update performance rankings as new rankings become available.
Calvert Group is the nation's leading family of socially responsible
mutual funds, both in terms of socially responsible mutual fund assets under
management, and number of socially responsible mutual fund portfolios offered
(source: Social Investment Forum, December 31, 1998). Calvert Group was also
the first to offer a family of socially responsible mutual fund portfolios.
- --------------------------------------------------------------------------------
PURCHASES AND REDEMPTION OF SHARES
- --------------------------------------------------------------------------------
Share certificates will not be issued unless requested in writing by
the investor. No charge will be made for share certificate requests. No
certificates will be issued for fractional shares (see Prospectus, "How to
Sell Your Shares"). Certain Class B and C Shares may be subject to a
contingent deferred sales charge which is subtracted from the redemption
proceeds (See Prospectus, "Calculation of Contingent Deferred Sales Charge").
Class O shareholders wishing to use the draft writing service should
complete the signature card enclosed with the Investment Application. The
draft writing service is not available for Class B, C, I, or T Shares. The
draft writing service will be subject to the customary rules and regulations
governing checking accounts, and the Fund reserves the right to change or
suspend the service. Generally, there is no charge to you for the maintenance
of this service or the clearance of drafts, but the Fund reserves the right to
charge a service fee for drafts returned for uncollected or insufficient
funds, and will charge $25 for stop payments. As a service to shareholders,
the Fund may automatically transfer the dollar amount necessary to cover
drafts you have written on the Fund to your Fund account from any other of
your identically registered accounts in Calvert money market funds or Calvert
Insured Plus. The Fund may charge a fee for this service.
When a payable through draft is presented to the Custodian for
payment, a sufficient number of full and fractional shares from the
shareholder's account to cover the amount of the draft will be redeemed at the
net asset value next determined. If there are insufficient shares in the
shareholder's account, the draft may be returned. Drafts presented for payment
which would require the redemption of shares purchased by check or electronic
funds transfer within the previous 10 business days may not be honored.
Existing shareholders, other than Class T, who at any time desire to
arrange for the telephone redemption procedure, or to change instructions
already given, must send a written notice to Calvert Group, P.O. Box 419544,
Kansas City, MO 64141-6544, with a voided copy of a check for the bank wiring
instructions to be added. If a voided check does not accompany the request,
then the request must be signature guaranteed by a commercial bank, savings
and loan association, trust company, member firm of any national securities
exchange, or credit union. Further documentation may be required from
corporations, fiduciaries, and institutional investors. Class T shareholders
should contact their broker, The Advisors Group, Ltd.
The right of redemption may be suspended or the date of payment
postponed for any period during which the New York Stock Exchange is closed
(other than customary weekend and holiday closings), when trading on the New
York Stock Exchange is restricted, or an emergency exists, as determined by
the SEC, or if the Commission has ordered such a suspension for the protection
of shareholders. Redemption proceeds are normally mailed or wired the next
business day after a proper redemption request has been received, unless
redemptions have been suspended or postponed as described above.
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TRUSTEES AND OFFICERS
- --------------------------------------------------------------------------------
RICHARD L. BAIRD, JR., Trustee. Mr. Baird is Executive Vice President
for the Family Health Council, Inc. in Pittsburgh, Pennsylvania, a non-profit
corporation which provides family planning services, nutrition, maternal/child
health care, and various health screening services. Mr. Baird is a
trustee/director of each of the investment companies in the Calvert Group of
Funds, except for Calvert Variable Series, Inc., Calvert New World Fund, Inc.
and Calvert World Values Fund, Inc. DOB: 05/09/48. Address: 211 Overlook
Drive, Pittsburgh, Pennsylvania 15216.
FRANK H. BLATZ, JR., Esq., Trustee. Mr. Blatz is a partner in the law
firm of Snevily, Ely, Williams & Blatz. He was formerly a partner with Abrams,
Blatz, Gran, Hendricks & Reina, P.A. He is also a director of Calvert Variable
Series, Inc. DOB: 10/29/35. Address: 308 East Broad Street, Westfield, New
Jersey 07091.
FREDERICK T. BORTS, M.D., Trustee. Dr. Borts is a radiologist with
Kaiser Permanente. Prior to that, he was a radiologist at Bethlehem Medical
Imaging in Allentown, Pennsylvania. DOB: 07/23/49. Address: 16 Iliahi Street,
Honolulu, Hawaii, 96817.
CHARLES E. DIEHL, Trustee. Mr. Diehl is a self-employed consultant
and is Vice President and Treasurer Emeritus of the George Washington
University. He has retired from University Support Services, Inc. of Herndon,
Virginia. Formerly, he was a Director of Acacia Mutual Life Insurance Company,
and is currently a Director of Servus Financial Corporation. DOB: 10/13/22.
Address: 1658 Quail Hollow Court, McLean, Virginia 22101.
DOUGLAS E. FELDMAN, M.D., Trustee. Dr. Feldman is managing partner of
Feldman Otolaryngology, Head and Neck Surgery in Washington, D.C. A graduate
of Harvard Medical School, he is Associate Professor of Otolaryngology, Head
and Neck Surgery at Georgetown University and George Washington University
Medical School, and past Chairman of the Department of Otolaryngology, Head
and Neck Surgery at the Washington Hospital Center. He is included in The Best
Doctors in America. DOB: 05/23/48. Address: 7536 Pepperell Drive, Bethesda,
Maryland 20817.
PETER W. GAVIAN, CFA, Trustee. Mr. Gavian is President of Corporate
Finance of Washington, Inc. Formerly, he was a principal of Gavian De Vaux
Associates, an investment banking firm. He is also a Chartered Financial
Analyst and an accredited senior business appraiser. DOB: 12/08/32. Address:
3005 Franklin Road North, Arlington, Virginia 22201.
JOHN G. GUFFEY, JR., Trustee. Mr. Guffey is chairman of the Calvert
Social Investment Foundation, organizing director of the Community Capital
Bank in Brooklyn, New York, and a financial consultant to various
organizations. In addition, he is a director of the Community Bankers Mutual
Fund of Denver, Colorado, a director of Ariel Funds, and the Treasurer and
Director of Silby, Guffey, and Co., Inc., a venture capital firm. Mr. Guffey
is a trustee/director of each of the other investment companies in the Calvert
Group of Funds, except for Calvert Variable Series, Inc. and Calvert New World
Fund, Inc.
Mr. Guffey has been advised that the Securities and Exchange
Commission ("SEC") has entered an order against him relating to his former
service as a director of Community Bankers Mutual Fund, Inc. This fund is not
connected with any Calvert Fund or the Calvert Group and ceased operations in
September, 1994. Mr. Guffey consented to the entry of the order without
admitting or denying the findings in the order. The order contains findings
(1) that the Community Bankers Mutual Fund's prospectus and statement of
additional information were materially false and misleading because they
misstated or failed to state material facts concerning the pricing of fund
shares and the percentage of illiquid securities in the fund's portfolio and
that Mr. Guffey, as a member of the fund's board, should have known of these
misstatements and therefore violated the Securities Act of 1933; (2) that the
price of the fund's shares sold to the public was not based on the current net
asset value of the shares, in violation of the Investment Company Act of 1940
(the "Investment Company Act"); and (3) that the board of the fund, including
Mr. Guffey, violated the Investment Company Act by directing the filing of a
materially false registration statement. The order directed Mr. Guffey to
cease and desist from committing or causing future violations and to pay a
civil penalty of $5,000. The SEC placed no restrictions on Mr. Guffey's
continuing to serve as a Trustee or Director of mutual funds. DOB: 05/15/48.
Address: 7205 Pomander Lane, Chevy Chase, Maryland 20815.
*BARBARA J. KRUMSIEK, President and Trustee. Ms. Krumsiek serves as
President, Chief Executive Officer and Vice Chairman of Calvert Group, Ltd.
and as an officer and director of each of its affiliated companies. She is a
director of Calvert-Sloan Advisers, L.L.C., and a trustee/director of each of
the investment companies in the Calvert Group of Funds. Ms. Krumsiek is the
President of each of the investment companies, except for Calvert Social
Investment Fund, of which she is the Senior Vice President. Prior to joining
Calvert Group, Ms. Krumsiek served as a Managing Director of Alliance Fund
Distributors, Inc. DOB: 08/09/52.
M. CHARITO KRUVANT, Trustee. Ms. Kruvant is President and CEO of
Creative Associates International, Inc., a firm that specializes in human
resources development, information management, public affairs and private
enterprise development. She is also a director of Acacia Federal Savings Bank.
DOB: 12/08/45. Address: 5301 Wisconsin Avenue, N.W., Washington, D.C. 20015.
ARTHUR J. PUGH, Trustee. Mr. Pugh is a Director of Calvert Variable
Series, Inc., and serves as a director of Acacia Federal Savings Bank. DOB:
09/24/37. Address: 4823 Prestwick Drive, Fairfax, Virginia 22030.
*DAVID R. ROCHAT, Senior Vice President and Trustee. Mr. Rochat is
Executive Vice President of Calvert Asset Management Company, Inc., Director
and Secretary of Grady, Berwald and Co., Inc., and Director and President of
Chelsea Securities, Inc. He is the Senior Vice President of First Variable
Rate Fund, Calvert Tax-Free Reserves, Calvert Municipal Fund, Inc., Calvert
Cash Reserves, and The Calvert Fund. DOB: 10/07/37. Address: Box 93, Chelsea,
Vermont 05038.
*D. WAYNE SILBY, Esq., Trustee. Mr. Silby is a trustee/director of
each of the investment companies in the Calvert Group of Funds, except for
Calvert Variable Series, Inc. and Calvert New World Fund. Mr. Silby is
Executive Chairman of Group Serve, Inc., an internet company focused on
community building collaborative tools, and an officer, director and
shareholder of Silby, Guffey & Company, Inc., which serves as general partner
of Calvert Social Venture Partners ("CSVP"). CSVP is a venture capital firm
investing in socially responsible small companies. He is also a Director of
Acacia Mutual Life Insurance Company. DOB: 07/20/48. Address: 1715 18th
Street, N.W., Washington, D.C. 20009.
RENO J. MARTINI, Senior Vice President. Mr. Martini is a director and
Senior Vice President of Calvert Group, Ltd., and Senior Vice President and
Chief Investment Officer of Calvert Asset Management Company, Inc. Mr. Martini
is also a director and President of Calvert-Sloan Advisers, L.L.C., and a
director and officer of Calvert New World Fund. DOB: 1/13/50.
RONALD M. WOLFSHEIMER, CPA, Treasurer. Mr. Wolfsheimer is Senior Vice
President and Chief Financial Officer of Calvert Group, Ltd. and its
subsidiaries and an officer of each of the other investment companies in the
Calvert Group of Funds. Mr. Wolfsheimer is Vice President and Treasurer of
Calvert-Sloan Advisers, L.L.C., and a director of Calvert Distributors, Inc.
DOB: 07/24/47.
WILLIAM M. TARTIKOFF, Esq., Vice President and Secretary. Mr.
Tartikoff is an officer of each of the investment companies in the Calvert
Group of Funds, and is Senior Vice President, Secretary, and General Counsel
of Calvert Group, Ltd., and each of its subsidiaries. Mr. Tartikoff is also
Vice President and Secretary of Calvert-Sloan Advisers, L.L.C., a director of
Calvert Distributors, Inc., and is an officer of Acacia National Life
Insurance Company. DOB: 08/12/47.
DANIEL K. HAYES, Vice President. Mr. Hayes is Vice President of
Calvert Asset Management Company, Inc., and is an officer of each of the other
investment companies in the Calvert Group of Funds, except for Calvert New
World Fund, Inc. DOB: 09/09/50.
SUSAN WALKER BENDER, Esq., Assistant Secretary. Ms. Bender is
Associate General Counsel of Calvert Group, Ltd. and an officer of each of its
subsidiaries and Calvert-Sloan Advisers, L.L.C. She is also an officer of each
of the other investment companies in the Calvert Group of Funds. DOB: 01/29/59.
KATHERINE STONER, Esq., Assistant Secretary. Ms. Stoner is Associate
General Counsel of Calvert Group and an officer of each of its subsidiaries
and Calvert-Sloan Advisers, L.L.C. She is also an officer of each of the other
investment companies in the Calvert Group of Funds. DOB: 10/21/56.
IVY WAFFORD DUKE, Esq., Assistant Secretary. Ms. Duke is Assistant
Counsel of Calvert Group and an officer of each of its subsidiaries and
Calvert-Sloan Advisers, L.L.C. She is also an officer of each of the other
investment companies in the Calvert Group of Funds. Prior to working at
Calvert Group, Ms. Duke was an Associate in the Investment Management Group of
the Business and Finance Department at Drinker Biddle & Reath. DOB: 09/07/68.
The address of Trustees and Officers, unless otherwise noted, is 4550
Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. Trustees and
Officers as a group own less than 1% of the Portfolio's outstanding shares.
Trustees marked with an *, above, are "interested persons" of the Fund, under
the Investment Company Act of 1940.
Each of the above named trustees and officers is a trustee or officer
of each of the investment companies in the Calvert Group of Funds with the
exception of Calvert Social Investment Fund, of which only Messrs. Baird,
Guffey and Silby and Ms. Krumsiek are among the Trustees, Calvert Variable
Series, Inc., of which only Messrs. Blatz, Diehl and Pugh and Ms. Krumsiek are
among the Directors, Calvert World Values Fund, Inc., of which only Messrs.
Guffey and Silby and Ms. Krumsiek are among the Directors, and Calvert New
World Fund, Inc., of which only and Ms. Krumsiek and Mr. Martini are among the
Directors.
The Board's Audit Committee is composed of Messrs. Baird, Blatz,
Feldman, Guffey and Pugh. The Investment Policy Committee is composed of
Messrs. Borts, Diehl, Gavian, Rochat and Silby.
During fiscal 1998, trustees of the Fund not affiliated with the
Fund's Advisor were paid $_______. Trustees of the Fund not affiliated with
the Advisor presently receive an annual fee of $20,500 for service as a member
of the Board of Trustees of the Calvert Group of Funds, and a fee of $750 to
$1,500 for each regular Board or Committee meeting attended; such fees are
allocated among the respective Funds on the basis of net assets.
Trustees of the Fund not affiliated with the Fund's Advisor may elect
to defer receipt of all or a percentage of their fees and invest them in any
fund in the Calvert Family of Funds through the Trustees Deferred Compensation
Plan (shown as "Pension or Retirement Benefits Accrued as part of Fund
Expenses," below). Deferral of the fees is designed to maintain the parties in
the same position as if the fees were paid on a current basis.
Trustee Compensation Table
Fiscal Year 1998 Aggregate Pension or Total Compensation
Compensation Retirement from Benefits
(unaudited numbers) from Registrant Accrued as Registrant and Fund
for Service part of Complex paid to
as Trustee of Registrant Trustee**
Expenses*
Name of Trustee
Richard L. Baird, Jr. $_,___ $0 $__,___
Frank H. Blatz, Jr. $_,___ $0 $__,___
Frederick T. Borts $_,___ $0 $__,___
Charles E. Diehl $_,___ $_,___ $__,___
Douglas E. Feldman $_,___ $0 $__,___
Peter W. Gavian $_,___ $_,___ $__,___
John G. Guffey, Jr. $_,___ $0 $__,___
M. Charito Kruvant $_,___ $_,___ $__,___
Arthur J. Pugh $_,___ $_,___ $__,___
D. Wayne Silby $_,___ $0 $__,___
*Messrs. Blatz, Diehl, Gavian and Pugh and Ms. Kruvant have chosen to defer a
portion of their compensation. As of December 31, 1998, total deferred
compensation, including dividends and capital appreciation, was $___,___.__,
$___,___.__, $___,___.__, $___,___.__, and $___,___.__, for each trustee,
respectively.
**As of December 31, 1998. The Fund Complex consists of nine (9) registered
investment companies.
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INVESTMENT ADVISOR
- --------------------------------------------------------------------------------
The Fund's Investment Advisor is Calvert Asset Management Company,
Inc., 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814, a
subsidiary of Calvert Group, Ltd., which is a subsidiary of Acacia Mutual Life
Insurance Company of Washington, D.C.
The Advisory Contract (the "Contract") between the Fund and the
Advisor will remain in effect indefinitely, provided continuance is approved
at least annually by the vote of the holders of a majority of the outstanding
shares of the Fund or by the Board of Trustees of the Fund; and further
provided that such continuance is also approved annually by the vote of a
majority of the Trustees of the Fund who are not parties to the Contract,
interested persons of parties to the Contract, or interested persons of such
parties, cast in person at a meeting called for the purpose of voting on such
approval. The Contract may be terminated without penalty by either party upon
60 days' prior written notice; it automatically terminates in the event of its
assignment.
Under the Contract, the Advisor provides investment advice to the
fund and oversees its day-to-day operations, subject to direction and control
by the Fund's Board of Trustees. For its services, effective with the
commencement of the Institutional Class (September 1998), the Advisor receives
a fee of 0.25% of the first $500 million of the average daily net assets of
the Fund, 0.225% of the next $400 million of such assets, 0.20% of the next
$400 million of such assets, 0.175% of the next $700 million of such assets,
and 0.15% on all assets in excess of $2 billion. Such fee is payable monthly.
The Advisor provides the Fund with investment advice and research,
pays the salaries and fees of all Trustees and executive officers of the Fund
who are principals of the Advisor, and pays certain Fund advertising and
promotional expenses. The Fund pays all other administrative and operating
expenses, including: custodial fees; shareholder servicing, dividend
disbursing and transfer agency fees; administrative service fees; federal and
state securities registration fees; insurance premiums; trade association
dues; interest, taxes and other business fees; legal and audit fees; and
brokerage commissions and other costs associated with the purchase and sale of
portfolio securities. However, the Advisor has agreed to reimburse the Fund
for all expenses (excluding brokerage, taxes, interest, and extraordinary
items) exceeding, on a pro rata basis, 1% of the Fund's average daily net
assets.
The advisory fees paid to the Advisor under the Advisory Contract for
the 1996, 1997, and 1998 fiscal years were $1,238,849, $1,206,618, and
$__________, respectively. No expense reimbursements have been required under
the Contract.
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ADMINISTRATIVE SERVICES
- --------------------------------------------------------------------------------
Calvert Administrative Services Company ("CASC"), a wholly-owned
subsidiary of Calvert Group, Ltd., has been retained by the Fund to provide
certain administrative services necessary to the conduct of the Fund's
affairs. Such services include the preparation of corporate and regulatory
reports and filings, portfolio accounting, and the daily determination of net
investment income and net asset value per share. Effective with the
commencement of the Institutional Class (September 1998), Classes O, B, and C
pay an annual rate of 0.25%, while the Institutional Class pays an annual rate
of 0.05%, based on average daily net assets. Class T pays an annual rate of
_.__%. There were no administrative services fees paid by the Fund in the
1997 fiscal year. During fiscal year 1998, the Fund paid $________ in
administrative fees.
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TRANSFER AND SHAREHOLDER SERVICING AGENT
- --------------------------------------------------------------------------------
National Financial Data Services, Inc. ("NFDS"), a subsidiary of
State Street Bank & Trust, has been retained by the Fund to act as transfer
agent and dividend disbursing agent. These responsibilities include:
responding to certain shareholder inquiries and instructions, crediting and
debiting shareholder accounts for purchases and redemptions of Fund shares and
confirming such transactions, and daily updating of shareholder accounts to
reflect declaration and payment of dividends.
Calvert Shareholder Services, Inc. ("CSSI"), a subsidiary of Calvert
Group, Ltd., and Acacia Mutual, has been retained by the Fund to act as
shareholder servicing agent. Shareholder servicing responsibilities include
responding to shareholder inquiries and instructions concerning their
accounts, entering any telephoned purchases or redemptions into the NFDS
system, maintenance of broker-dealer data, and preparing and distributing
statements to shareholders regarding their accounts. Calvert Shareholder
Services, Inc. was the sole transfer agent prior to January 1, 1998.
For its fiscal years ended December 31, 1996, 1997 and 1998, the Fund
paid fees of $561,279, $447,044, and $_______, respectively.
- --------------------------------------------------------------------------------
PORTFOLIO TRANSACTIONS
- --------------------------------------------------------------------------------
Portfolio transactions are undertaken on the basis of their
desirability from an investment standpoint. Investment decisions and choice of
brokers and dealers are made by the Fund's Advisor under the direction and
supervision of the Fund's Board of Trustees.
It is intended that all securities maturing in more than one year
will be held to maturity. Sales of securities to facilitate the redemption of
Fund shares is contemplated, but such sales will be primarily from the
short-term instruments in the Fund's portfolio on which brokerage charges, if
any, are minimal. The Fund anticipates that its portfolio turnover rate with
respect to securities with maturities in excess of one year will be no more
than 5%.
Broker-dealers who execute portfolio transactions on behalf of the
Fund are selected on the basis of their professional capability and the value
and quality of their services. The Advisor reserves the right to place orders
for the purchase of sale of portfolio securities with dealers who provide it
with statistical, research, or other information and services. Although any
statistical, research, or other information and services provided by dealers
may be useful to the Advisor, the dollar value of such information is
generally indeterminable, and its availability or receipt does not serve to
materially reduce the Advisor's normal research activities or expenses. No
brokerage commissions have been paid to any broker-dealer that provided the
Fund's Advisor with research or other services.
The Advisor may also execute portfolio transactions with or through
broker-dealers who have sold shares of the Fund. However, such sales will not
be a qualifying or disqualifying factor in a broker-dealer's selection nor
will the selection of any broker-dealer be based on the volume of Fund shares
sold. The Advisor may compensate, at its expense, such broker-dealers in
consideration of their promotional and administrative services.
- --------------------------------------------------------------------------------
INDEPENDENT ACCOUNTANTS AND CUSTODIANS
- --------------------------------------------------------------------------------
PricewaterhouseCoopers, L.L.P. has been selected by the Board of
Trustees to serve as independent accountants for fiscal year 1999. State
Street Bank & Trust Company, N.A., 225 Franklin Street, Boston, Massachusetts
02110, currently serves as custodian of the Portfolio's investments. First
National Bank of Maryland, 25 South Charles Street, Baltimore, Maryland 21203
also serves as custodian of certain of the Portfolio's cash assets. Neither
custodian has any part in deciding the Portfolio's investment policies or the
choice of securities that are to be purchased or sold for the Portfolio.
- --------------------------------------------------------------------------------
METHOD OF DISTRIBUTION
- --------------------------------------------------------------------------------
The Fund has entered into an agreement with Calvert Distributors,
Inc. ("CDI") whereby CDI, acting as principal underwriter for the Fund, makes
a continuous offering of the Fund's securities on a "best efforts" basis.
Under the terms of the agreement, CDI is entitled to receive a distribution
fee from the Fund paid through the Distribution Plans of Class B, C, and T.
Class O and the Institutional Class have no Distribution Plans. For Class B
and Class C shares, CDI receives any CDSC paid.
Pursuant to Rule 12b-1 under the 1940 Act, Class B, C, and T have
adopted Distribution Plans (the "Plans") which permit them to pay certain
expenses associated with the distribution and servicing of its shares. Such
expenses may not exceed, on an annual basis, 1.00% of the average daily net
assets of Class B and C, respectively, and 0.25% of Class T.
The Distribution Plans were approved by the Board of Trustees,
including the Trustees who are not "interested persons" of the Fund (as that
term is defined in the 1940 Act) and who have no direct or indirect financial
interest in the operation of the Plans or in any agreements related to the
Plans. The selection and nomination of the Trustees who are not interested
persons of the Fund is committed to the discretion of such disinterested
Trustees. In establishing the Plans, the Trustees considered various factors
including the amount of the distribution expenses. The Trustees determined
that there is a reasonable likelihood that the Plans will benefit the affected
Class and its shareholders.
The Plans may be terminated by vote of a majority of the
non-interested Trustees who have no direct or indirect financial interest in
the Plans, or by vote of a majority of the outstanding shares of the affected
class or Portfolio. Any change in the Plans that would materially increase the
cost to the affected Class of Portfolio requires approval of the shareholders
of that class; otherwise, the Plans may be amended by the Trustees, including
a majority of the non-interested Trustees as described above. The Plans will
continue in effect for successive one-year terms provided that such
continuance is specifically approved by (i) the vote of a majority of the
Trustees who are not parties to the Plans or interested persons of any such
party and who have no direct or indirect financial interest in the Plans, and
(ii) the vote of a majority of the entire Board of Trustees.
Apart from the Plans, the Advisor and CDI, at their own expense, may
incur costs and pay expenses associated with the distribution of shares of the
Portfolio.
Certain broker-dealers, and/or other persons may receive compensation
from the investment advisor, underwriter, or their affiliates for the sale and
distribution of the securities or for services to the Portfolio. Such
compensation may include additional compensation based on assets held through
that firm beyond the regularly scheduled rates, and finder's fees payments to
firms whose representatives are responsible for soliciting a new account where
the accountholder does not choose to purchase through that firm.
- --------------------------------------------------------------------------------
GENERAL INFORMATION
- --------------------------------------------------------------------------------
The Fund is organized as a Massachusetts business trust, and has one
series, the Calvert First Government Money Market Fund which was known as
First Variable Rate Fund prior to September 1, 1991. The Fund's Declaration of
Trust contains an express disclaimer of shareholder liability for acts or
obligations of the Fund. The shareholders of Massachusetts business trust
might, however, under certain circumstances, be held personally liable as
partners for its obligations. The Declaration of Trust provides for
indemnification and reimbursement of expenses out of Fund assets for any
shareholder held personally liable for obligations of the Fund. The
Declaration of Trust provides that the Fund shall, upon request, assume the
defense of any claim made against any shareholder for any act or obligation of
the Fund and satisfy any judgment thereon. The Declaration of Trust further
provides that the Fund may maintain appropriate insurance (for example,
fidelity bonding and errors and omissions insurance) for the protection of the
Fund, its shareholders, trustees, officers, employees and agents to cover
possible tort and other liabilities. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to circumstances
in which both inadequate insurance exists and the Fund itself is unable to
meet its obligations.
The Fund offers five separate classes of shares: Class O, Class B,
Class C, offered in one prospectus; the Institutional Class, offered in a
separate prospectus, and Class T, also offered by a separate prospectus. The
classes represent interests in the same portfolio of investments but, as
further described in the prospectuses, each class may be subject to differing
sales charges and expenses, which will result in different dividends and
distributions. Upon any liquidation of the Fund, shareholders of each class
are entitled to share pro rata in the net assets available for distribution.
The Fund will send its shareholders periodic transaction statements
and unaudited semi-annual and audited annual financial statements of the
Fund's investment securities, assets and liabilities, income and expenses, and
changes in net assets.
The Prospectuses and this Statement of Additional Information do not
contain all the information in the Fund's registration statement. The
registration statement is on file with the Securities and Exchange Commission
and is available to the public.
<PAGE>
PART C. OTHER INFORMATION
Item 23. Exhibits
1. Declaration of Trust (incorporated by reference to Registrant's
Post-Effective Amendment No. 11, May 1, 1984).
2. By-Laws (incorporated by reference to Registrant's
Post-Effective Amendment No. 11, May 1, 1984).
4. Specimen Stock Certificate, (incorporated by reference to
Registrant's Post-Effective Amendment No. 19, April 30, 1992).
5. Advisory Contract (incorporated by reference to Registrant's
Post-Effective Amendment No. 11, May 1, 1984).
6. Underwriting and Dealer Agreement, (incorporated by reference to
Registrant's Post-Effective Amendment No. 35, March 31, 1998).
7. Trustees' Deferred Compensation Agreement, (incorporated by
reference to Registrant's Post-Effective Amendment No. 19, April
30, 1992).
8. Custodial Contract, (incorporated by reference to Registrant's
Post-Effective Amendment No. 35, March 31, 1998).
9. Transfer Agency Contract, (incorporated by reference to
Registrant's Post-Effective Amendment No. 35, March 31, 1998).
10. Opinion and Consent of Counsel as to Legality of
Shares Being Registered.
15. Plan of Distribution, (incorporated by reference to Registrant's
Post-Effective Amendment No. 35, March 31, 1998).
18. Multiple-class Plan under the Investment Company Act of 1940
Rule 18f-3, filed herewith.
Item 24. Persons Controlled By or Under Common Control With Registrant
Not Applicable.
Item 26. Business and Other Connections of Investment Adviser
Name of Company, Principal
Name Business and Address Capacity
Barbara J. Krumsiek Calvert Variable Series, Inc. Officer
Calvert Municipal Fund, Inc. and
Calvert World Values Fund, Inc. Director
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income and
Calvert Tax-Free Reserves Trustee
Calvert Social Investment Fund
Calvert Cash Reserves
The Calvert Fund
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
----------------
Calvert Group, Ltd. Officer
Holding Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Distributors, Inc. Officer
Broker-Dealer and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert New World Fund, Inc. Director
Investment Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
--------------
Alliance Capital Mgmt. L.P. Sr. Vice President
Mutual Fund Division Director
1345 Avenue of the Americas
New York, NY 10105
--------------
Ronald M. Wolfsheimer First Variable Rate Fund Officer
for Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
--------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Distributors, Inc. Officer
Broker-Dealer and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
David R. Rochat First Variable Rate Fund Officer
for Government Income and
Calvert Tax-Free Reserves Trustee
Calvert Cash Reserves
The Calvert Fund
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Municipal Fund, Inc. Officer
Investment Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Chelsea Securities, Inc. Officer
Securities Firm and
Post Office Box 93 Director
Chelsea, Vermont 05038
---------------
Grady, Berwald & Co. Officer
Holding Company and
43A South Finley Avenue Director
Basking Ridge, NJ 07920
---------------
Reno J. Martini Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
First Variable Rate Fund Officer
for Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert New World Fund, Inc. Director
Investment Company and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Director
Investment Advisor and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
---------------
Charles T. Nason Acacia Life Insurance Officer
Acacia National Life Insurance and Director
Insurance Companies
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Financial Corporation Officer
Holding Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
---------------
Acacia Federal Savings Bank Director
Savings Bank
7600-B Leesburg Pike
Falls Church, Virginia 22043
---------------
Enterprise Resources, Inc. Director
Business Support Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Realty Square, L.L.C. Director
Realty Investments
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Gardner Montgomery Company Director
Tax Return Preparation Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Director
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Director
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Director
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Social Investment Fund Trustee
Investment Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
-----------------
The Advisors Group, Ltd. Director
Broker-Dealer and
Investment Advisor
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Robert-John H. Acacia National Life Insurance Officer
Sands Insurance Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
----------------
Acacia Mutual Life Insurance Officer
Insurance Company
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
Acacia Financial Corporation Officer
Holding Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
----------------
Acacia Federal Savings Bank Officer
Savings Bank
7600-B Leesburg Pike
Falls Church, Virginia 22043
---------------
Enterprise Resources, Inc. Director
Business Support Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Realty Square, L.L.C. Director
Realty Investments
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
The Advisors Group, Ltd. Director
Broker-Dealer and
Investment Advisor
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Gardner Montgomery Company Director
Tax Return Preparation Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Director
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Director
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management, Co., Inc. Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Director
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
William M. Tartikoff Acacia National Life Insurance Officer
Insurance Company
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Officer
Services Company
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co. Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Director
Broker-Dealer and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Susan Walker Bender Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Katherine Stoner Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Ivy Wafford Duke Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Daniel K. Hayes Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Calvert Variable Series, Inc.
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Steve Van Order Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
John Nichols Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
David Leach Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Matthew D. Gelfand Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Strategic Investment Management Officer
Investment Advisor
1001 19th Street North
Arlington, Virginia 20009
------------------
Item 27. Principal Underwriters
(a) Registrant's principal underwriter also underwrites shares
of Calvert Tax-Free Reserves, Calvert Social Investment Fund, Calvert Cash
Reserves, The Calvert Fund, Calvert Municipal Fund, Inc., Calvert World
Values Fund, Inc., Calvert New World Fund, Inc., and Calvert Variable Series,
Inc. (formerly named Acacia Capital Corporation).
(b) Positions of Underwriter's Officers and Directors
Name and Principal Position(s) with Position(s) with
Business Address Underwriter Registrant
Barbara J. Krumsiek Director and President President and Trustee
Ronald M. Wolfsheimer Director, Senior Vice Treasurer
President and Chief Financial Officer
William M. Tartikoff Director, Senior Vice Vice President and
President and Secretary Secretary
Craig Cloyed Senior Vice President None
Karen Becker Vice President, Operations None
Steve Cohen Vice President None
Geoffrey Ashton Regional Vice President None
Martin Brown Regional Vice President None
Janet Haley Regional Vice President None
Ben Ogbogu Regional Vice President None
Susan Walker Bender Assistant Secretary Assistant Secretary
Katherine Stoner Assistant Secretary Assistant Secretary
Ivy Wafford Duke Assistant Secretary Assistant Secretary
(c) Inapplicable.
Item 28. Location of Accounts and Records
Ronald M. Wolfsheimer, Treasurer
and
William M. Tartikoff, Assistant Secretary
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
Item 29. Management Services
Not Applicable
Item 30. Undertakings
Not Applicable
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940, the Registrant certifies that it
has duly caused this registration statement to be signed on its behalf
by the undersigned, duly authorized, in the City of Bethesda, and
State of Maryland, on the 14th day of January, 1999.
FIRST VARIABLE RATE FUND
By:
________________**________________
Barbara J. Krumsiek
President and Trustee
SIGNATURES
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 date indicated.
Signature Title Date
__________**____________ President and 1/14/99
Barbara J. Krumsiek Trustee (Principal Executive Officer)
__________**____________ Principal Accounting 1/14/99
Ronald M. Wolfsheimer Officer
__________**____________ Trustee 1/14/99
Richard L. Baird, Jr.
__________**____________ Trustee 1/14/99
Frank H. Blatz, Jr., Esq.
__________**____________ Trustee 1/14/99
Frederick T. Borts, M.D.
__________**____________ Trustee 1/14/99
Charles E. Diehl
__________**____________ Trustee 1/14/99
Douglas E. Feldman
__________**____________ Trustee 1/14/99
Peter W. Gavian
__________**____________ Trustee 1/14/99
John G. Guffey, Jr.
__________**____________ Trustee 1/14/99
M. Charito Kruvant
__________**____________ Trustee 1/14/99
Arthur J. Pugh
__________**____________ Trustee 1/14/99
David R. Rochat
__________**____________ Trustee 1/14/99
D. Wayne Silby
**By Katherine Stoner as Attorney-in-fact, pursuant to Power of Attorney Forms
on file.
Exhibit 10
January 14, 1999
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Exhibit 10, Form N-1A
First Variable Rate Fund
File numbers 2-56809 and 811-2633
Ladies and Gentlemen:
As counsel to Calvert Group, Ltd., it is my opinion that the
securities being registered by this Post-Effective Amendment No. 37 will
be legally issued, fully paid and non-assessable when sold. My opinion
is based on an examination of documents related to First Variable Rate
Fund (the "Trust"), including its Declaration of Trust, its By-Laws,
other original or photostatic copies of Trust records, certificates of
public officials, documents, papers, statutes, and authorities as I
deemed necessary to form the basis of this opinion.
I therefore consent to filing this opinion of counsel with the
Securities and Exchange Commission as an Exhibit to the Trust's
Post-Effective Amendment No. 37 to its Registration Statement.
Sincerely,
/s/
Katherine Stoner
Associate General Counsel
