August 11, 1995
Securities and Exchange Commission
450 5th Street N.W.
Washington, D. C. 20549
RE: D.L. BABSON MONEY MARKET FUND, INC.
Post-Effective Amendment No. 21 File No. 2-65761
Amendment No. 23 File No. 811-2963
Ladies and Gentlemen:
Attached hereto is Post-Effective Amendment No. 21 and Amendment No. 23
to the Registration Statements for D. L. BABSON MONEY MARKET FUND, INC.
on Form N-1A for filing pursuant to paragraph (a) of rule 485.
The sole purpose of this amendment is to reflect a change in the ownership
of the Fund's investment advisor. On June 30, 1995, David L. Babson & Co.
Inc., the investment advisor, became a wholly-owned subsidiary of
Massachusetts Mutual Life Insurance Company headquartered in Springfield,
Massachusetts. There were no changes to the personnel of David L.
Babson & Co. Inc. and no changes in the investment policies or operations
of the Fund.
The only section of the prospectus affected by this change is the caption
Management and Investment Counsel. There are no other changes included
in this amendment.
It is requested that the effective date of this amendment be October 31, 1995
in order to make it effective concurrently with an additional amendment
which it is anticipated will be filed pursuant to paragraph (b) of
rule 485 on or after October 10, 1995 to supply updated financials for
the Fund.
Thank you very much for your consideration in this matter.
Sincerely,
JGD:com John G. Dyer
Enc. Attorney
<PAGE>
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. 21 File No. 2-65761 [X]
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 23 File No. 811-2963 [X]
D.L. BABSON MONEY MARKET FUND, INC.
(Exact Name of Registrant as Specified in Charter)
2440 Pershing Road, G-15 Kansas City, Missouri 64108
(Address of Principal Executive Office)
Registrant's Telephone Number,including Area Code (816)_471-5200
Larry D. Armel, President, D.L. BABSON MONEY MARKET FUND, INC.
2440 Pershing Road, G-15, Kansas City, Missouri 64108
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: October 31, 1994
It is proposed that this filing become effective:
X On October 31, 1995, pursuant to paragraph (a) of Rule 485
Registrant has registered an indefinite number or amount of securities
under the Securities Act of 1933 pursuant to Rule 24f-2 of the Invest-
ment Company Act of 1940, and will file its required Rule 24f-2 Notice
for the Registrant's fiscal year ended June 30, 1995, by August 30,
1995.
Please address inquiries and a carbon copy of all
and communications to: communications to:
John G. Dyer, Esq. Mark H. Plafker, Esq.
D.L. BABSON MONEY MARKET Stradley, Ronon, Stevens & Young
FUND, INC. 2600 One Commerce Square
2440 Pershing Road, G-15 Philadelphia, PA 19103-7098
Kansas City, MO 64108 Telephone: (215) 564-8024
Telephone: (816) 471-5200
D.L. BABSON MONEY MARKET FUND, INC.
CROSS REFERENCE SHEET
Form N-1A Item Number Location in Prospectus
Item 1. Cover Page . . . . . . . . . . . . . Cover Page
Item 2. Synopsis . . . . . . . . . . . . . . Not Applicable
Item 3. Condensed Financial Information . . Per Share Capital and
Income Changes
Item 4. General Description of Registrant. . Investment Objective
and Portfolio
Management Policy
Item 5. Management of the Fund . . . . . . . Officers and Directors;
Management and
Investment Counsel
Item 6. Capital Stock and Other Securities . How to Purchase Shares;
How to Redeem Shares;
How Share Price is
Determined; General
Information and
History; How Share
Price is Determined
Dividends Distributions
and their Taxation
Item 7. Purchase of Securities . . . . . . . Cover Page; How to
being Offered Purchase Shares;
Shareholder Services
Item 8. Redemption or Repurchase . . . . . . How to Redeem Shares
Item 9. Pending Legal Proceedings . . . . . Not Applicable
D.L. BABSON MONEY MARKET FUND, INC.
CROSS REFERENCE SHEET (CONTINUED)
Location in Statement
of Additional
Form N-1A Item Number Information
Item 10. Cover Page . . . . . . . . . . . . . Cover Page
Item 11. Table of Contents . . . . . . . . . Cover Page
Item 12. General Information and History . . Investment Objectives
and Policies;
Management and
Investment Counsel
Item 13. Investment Objectives and Policies . Investment Objectives
and Policies;
Investment Restrictions
Item 14. Management of the Fund . . . . . . . Management and
Investment Counsel
Item 15. Control Persons and Principal . . . Management and
Holders of Securities Investment Counsel;
Officers and Directors
Item 16. Investment Advisory and other . . . Management and
Services Investment Counsel;
Shareholder Services
(Prospectus)
Item 17. Brokerage Allocation . . . . . . . . Portfolio Transactions
Item 18. Capital Stock and Other Securities . General Information;
Financial Statements
Item 19. Purchase, Redemption and Pricing . . How Share Purchases
of Securities Being Offered are Handled; Redemption
of Shares
Financial Statements
Item 20. Tax Status . . . . . . . . . . . . . Dividends,
Distributions and their
Taxation (in prospectus
Item 21. Underwriters . . . . . . . . . . . . How the Fund's Shares
are Distributed
Item 22. Calculation of Yield Quotations . . Performance Measures
of Money Market Fund
Item 23. Financial Statements . . . . . . . . Incorporated by
Reference
PROSPECTUS
October 31, 1995
D. L. BABSON MONEY MARKET FUND, INC.
Managed and Distributed By:
JONES & BABSON, INC.
Three Crown Center
2440 Pershing Road, Suite G-15
Kansas City, Missouri 64108
Toll-Free 1-800-4-BABSON
(1-800-422-2766)
In the Kansas City area 471-5200
Investment Counsel:
DAVID L. BABSON & CO. INC.
Cambridge, Massachusetts
INVESTMENT OBJECTIVE
The Babson Money Market Fund offers two Portfolios to investors
who share the Fund's investment goal of maximizing income
consistent with safety of principal and liquidity, and who desire
to have their investment receive continuous portfolio supervision
by the staff of David L. Babson & Co. Inc.
Each Portfolio seeks to maintain, but does not guarantee, a
constant net asset value of $1.00 per share. Although each
Portfolio invests in high quality instruments, the shares of the
Portfolios are not insured or guaranteed by the U.S. Government
and there can be no assurance that each Portfolio will be able to
maintain a constant net asset value per share.
PURCHASE INFORMATION
Minimum Investment
(each Portfolio selected)
Initial Purchase $ 1,000
Initial IRA and Uniform Transfers (Gifts)
to Minors Purchases $ 250
Subsequent Purchase:
By Mail $ 100
By Telephone or Wire $ 1,000
All Automatic Purchases $ 100
Shares are purchased and redeemed at net asset value. There are
no sales, redemption or Rule 12b-1 distribution charges. If you
need further information, please call the Fund at the telephone
numbers indicated.
ADDITIONAL INFORMATION
This prospectus should be read and retained for future reference.
It contains the information that you should know before you
invest. A "Statement of Additional Information" of the
same date as this prospectus has been filed with the Securities
and Exchange Commission and is incorporated by reference.
Investors desiring additional information about the Fund may
obtain a copy without charge by writing or calling the Fund.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION 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
Fund Expenses 3
Financial Highlights 4
Investment Objective and Portfolio Management Policy 5
Repurchase Agreements 6
Risk Factors Peculiar to Money Market Instruments 6
Investment Restrictions 6
Performance Measures 7
How to Purchase Shares 7
Initial Investments 8
Investments Subsequent to Initial Investments 9
Telephone Investment Service 9
Automatic Monthly Investment Plan 9
How to Redeem Shares 9
Systematic Redemption Plan 12
How to Exchange Shares Between Portfolios and Babson Funds 13
How Share Price is Determined 14
Officers and Directors 15
Management and Investment Counsel 15
General Information and History 16
Dividends, Distributions and Their Taxation 17
Shareholder Services 18
Shareholder Inquiries 19
FUND EXPENSES
FEDERAL PORTFOLIO
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses ___%
Total Fund operating expenses ___%
You would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return and (2) redemption at the end of
each time period:
1 Year 3 Year 5 Year 10 Year
$_ $__ $__ $___
PRIME PORTFOLIO
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses ___%
Total Fund operating expenses ___%
You would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return and (2) redemption at the end of
each time period:
1 Year 3 Year 5 Year 10 Year
$_ $__ $__ $___
The above information is provided in order to assist you in
understanding the various costs and expenses that a shareholder
of the Fund will bear directly or indirectly. The expenses set
forth above are for the fiscal year ended June 30, 1995. The
example should not be considered a representation of past or
future expenses. Actual expenses may be greater or less than
those shown.
D. L. BABSON MONEY MARKET FUND, INC.
FINANCIAL HIGHLIGHTS
(To be supplied by further amendment)
INVESTMENT OBJECTIVE and PORTFOLIO MANAGEMENT POLICY
Babson Money Market Fund offers two separate Portfolios, each of
which invests in high quality short-term debt instruments for the
purpose of maximizing income consistent with safety of principal
and liquidity. Each Portfolio also seeks to maintain a constant
price of $1.00 per share. Neither Portfolio's objective can be
changed without the approval of a majority of its outstanding
shares. Each Portfolio will limit its holdings to the types of
securities hereinafter described.
FEDERAL PORTFOLIO
The Federal Portfolio will invest only in the following U.S.
Government Securities :
1. Direct obligations of the U.S. government such as
bills, notes, bonds and other debt securities issued by the U.S.
treasury.
2. Obligations of U.S. government agencies and
instrumentalities which are secured by the full faith and credit
of the U.S. treasury such as securities of the Government
National Mortgage Association, the Export-Import Bank, or the
Student Loan Marketing Association; or which are secured by the
right of the issuer to borrow from the Treasury, such as
securities issued by the Federal Financing Bank or the U.S.
Postal Service; or are supported by the credit of the government
agency or instrumentality itself, such as securities of the
Federal Home Loan Banks, or the Federal National Mortgage
Association.
The Federal Portfolio also may invest in issues of the United
States treasury or United States government agencies subject to
repurchase agreements entered into with the seller of the issues.
The use of repurchase agreements by the Fund involves certain
risks. For a discussion of repurchase agreements and their risks
see page 6.
PRIME PORTFOLIO
The Prime Portfolio may invest in any of the following in
addition to securities eligible for the Federal Portfolio:
1. Certificates of deposit, bankers' acceptances, and
other short-term obligations issued domestically by United States
commercial banks having assets of at least $1 billion and which
are members of the Federal Deposit Insurance Corporation, or
holding companies of such banks.
2. Commercial paper, including variable rate master demand
notes of companies whose commercial paper is rated P-2 or higher
by Moody s Investors Service, Inc. (Moody s) or A-2 or higher
by Standard and Poor s Corporation (S&P). If not rated by either
Moody s or S&P, a company's commercial paper, including variable
rate master demand notes, may be purchased by the Portfolio if
the company has an outstanding bond issue rated Aa or higher by
Moody's or AA or higher by S&P. Variable rate master demand notes
represent a borrowing arrangement under a letter of agreement
between a commercial paper issuer and an institutional lender.
Applicable interest rates are determined on a formula basis and
are adjusted on a monthly, quarterly, or other term as set out in
the agreement. They vary as to the right of the lender to demand
payment. (For a description of money market securities and their
ratings, see Money Market Securities Described and Ratings
in the Statement of Additional Information. )
3. Short-term debt securities which are non-convertible
and which have one year or less remaining to maturity at the date
of purchase and which are rated Aa or higher by Moody s or AA or
higher by S&P.
4. Negotiable certificates of deposit and other short-term
debt obligations of savings and loan associations having assets
of at least $1 billion and which are members of the Federal Home
Loan Banks Association and insured by the Federal Deposit
Insurance Corporation.
To achieve its objectives the Fund may engage in trading activity
in order to take advantage of opportunities to enhance yield,
protect principal or improve liquidity. This trading activity
should not increase the Fund's expenses, since there are normally
no broker's commissions paid by the Fund for the purchase or sale
of money market instruments. However, a markup or spread may be
paid to a dealer from which the Fund purchases a security. To
assure compliance with adopted procedures pursuant to Rule 2a-7
under the Investment Company Act of 1940 (the 1940 Act ), the
Fund will only invest in U.S. dollar denominated securities with
remaining maturities of 397 days or less, maintain the dollar
weighted average maturity of the securities in the Fund s
portfolio at 90 days or less and limit its investments to those
instruments which the Directors of the Fund determines present
minimal credit risks and which are eligible investments under the
rule.
REPURCHASE AGREEMENTS
A repurchase agreement involves the sale of securities to the
Portfolio with the concurrent agreement by the seller to
repurchase the securities at the Portfolio's cost plus interest
at an agreed rate upon demand or within a specified time, thereby
determining the yield during the purchaser's period of ownership.
This results in a fixed rate of return insulated from market
fluctuations during such period. Under the Investment Company Act
of 1940, repurchase agreements are considered loans by the Fund.
The Fund will enter into such repurchase agreements only with
United States banks having assets in excess of $1 billion which
are members of the Federal Deposit Insurance Corporation, and
with certain securities dealers who meet the qualifications set
from time to time by the Board of Directors of the Fund.
Securities subject to a repurchase agreement may bear maturities
exceeding one year but the term of the repurchase agreement
normally will be no longer than a few days. Repurchase agreements
maturing in more than seven days and other illiquid securities
will not exceed 10% of the total assets of the Portfolio.
Risk Factors Applicable to
Repurchase Agreements
Repurchase agreements involve investments in debt securities
where the seller (broker-dealer or bank) agrees to repurchase the
securities from the Fund at cost plus an agreed-to interest rate
within a specified time. A risk of repurchase agreements is that
if the seller seeks the protection of the bankruptcy laws, the
Fund's ability to liquidate the security involved could be
temporarily impaired, and it subsequently might incur a loss if
the value of the security declines or if the other party to a
repurchase agreement defaults on its obligation. There is also
the risk that the Fund may be delayed or prevented from
exercising its rights to dispose of the collateral.
RISK FACTORS PECULIAR TO MONEY MARKET INSTRUMENTS
The yield and the principal value of money market instruments are
sensitive to short-term lending conditions, and it is possible
that an issuer may default. The Fund will seek to minimize these
risks through portfolio diversification, careful portfolio
selection among securities considered to be high quality and by
maintaining short average maturities.
Concentration of assets in the banking industry may increase the
element of risk because banks are highly leveraged. The manager
believes this risk is reduced because purchases will be limited
to banks which are members of the Federal Deposit Insurance
Corporation, although securities purchased by the Fund may not be
FDIC insured deposits. Furthermore, the manager will carefully
evaluate the financial ratios and asset characteristics of banks
in which the Fund might invest, and reject those banks whose
financial ratios and asset characteristics are not, in the
manager's opinion, sufficiently strong.
INVESTMENT RESTRICTIONS
In addition to the policies set forth under the caption
Investment Objective and Portfolio Management Policy the
Fund is subject to certain other restrictions which may not be
changed without approval of the "holders of a majority of the
outstanding shares" of the Fund or the affected Portfolio. Among
these restrictions, the more important ones are that the Fund
(Portfolio) will not invest in equity securities; purchase the
securities of any issuer if more than 5% of the Fund's total
assets would be invested in the securities of such issuer, or the
Fund would hold more than 10% of any class of securities of such
issuer; borrow money in excess of 15% of total assets taken at
market value, and then only from banks as a temporary measure for
extraordinary or emergency purposes; will not borrow to increase
income (leveraging) but only to facilitate redemption requests
which might otherwise require untimely dispositions of portfolio
securities; will repay all borrowings before making additional
investments (interest paid on such borrowings will reduce net
income). The full text of these restrictions is set forth in the
Statement of Additional Information.
There is no limitation with respect to investments in U.S.
Treasury Bills, or other obligations issued or guaranteed by the
federal government, its agencies and instrumentalities.
PERFORMANCE MEASURES
From time to time, the Fund may advertise its performance in
various ways, as summarized below. Further discussion of these
matters also appears in the "Statement of Additional
Information."
Yield
From time to time, each Portfolio may advertise "yield"
and "effective yield." The "yield" of a Fund
refers to the income generated by an investment in a Fund over a
seven-day period (which period will be stated in the
advertisement). This income is then "annualized." That
is, the amount of income generated by the investment during that
week is assumed to be generated each week over a 52-week period
and is shown as a percentage of the investment. The
"effective yield" is calculated similarly, but, when
annualized, the income earned by an investment in a Portfolio is
assumed to be reinvested. The "effective yield" will be
slightly higher than the "yield" because of the
compounding effect of this assumed reinvestment.
Each Portfolio of the Fund may quote its yield in advertisements
or in reports to shareholders. Yield information may be useful in
reviewing the performance of the Fund Portfolios and in providing
a basis for comparison with other investment alternatives.
However, since the net investment income of these Funds changes
in response to fluctuations in interest rates and Fund expenses,
any given yield quotations should not be considered
representative of the Fund's yields for any future period.
Current yield and price quotations for the Fund may be obtained
by telephoning 1-800-4-BABSON (1-800-422-2766), or in the Kansas
City area 471-5200.
Performance Comparisons
In advertisements or in reports to shareholders, the Fund may
compare its performance to that of other mutual funds with
similar investment objectives and to stock or other relevant
indices. For example, each Portfolio may compare its yields to
the Donoghue's Money Fund Average and the Donoghue's Government
Money Fund Average which are averages compiled by Donoghue's
Money Fund Report, a widely recognized independent publication
that monitors the performance of money market mutual funds, or to
the average yield reported by the Bank Rate Monitor for money
market deposit accounts offered by the 50 leading banks and
thrift institutions in the top five standard metropolitan
statistical areas. Performance comparisons should not be
considered as representative of the future performance of any
Fund. Further information regarding the performance of the Fund
is contained in the "Statement of Additional Information."
Performance rankings, recommendations, published editorial
comments and listings reported in Money, Barron's, Kiplinger's
Personal Finance Magazine, Financial World, Forbes, U.S. News &
World Report, Business Week, The Wall Street Journal, Investors
Business Daily, USA Today, Fortune and Stangers's may also be
cited (if the Fund is listed in any such publication) or used for
comparison, as well as performance listings and rankings from
Morningstar Mutual Funds, Personal Finance, Income and Safety,
The Mutual Fund Letter, No-Load Fund Investor, United Mutual Fund
Selector, No-Load Fund Analyst, No- Load Fund X, Louis Rukeyser's
Wall Street newsletter, Donoghue's Money Letter, CDA Investment
Technologies, Inc., Wiesenberger Investment Companies Service,
and Donoghue's Mutual Fund Almanac.
HOW TO PURCHASE SHARES
Shares are purchased at net asset value (no sales charge) from
the Fund through its agent, Jones & Babson, Inc., Three Crown
Center, 2440 Pershing Road, Suite G-15, Kansas City, MO 64108.
For information call toll free 1-800-4-BABSON (1-800-422-2766),
or in the Kansas City area 471-5200. If an investor wishes to
engage the services of any other broker to purchase (or redeem)
shares of the Fund, a fee may be charged by such broker. The Fund
will not be responsible for the consequences of delays including
delays in the banking or Federal Reserve wire systems.
You do not pay a sales commission when you buy shares of the
Fund. Shares are purchased at the Fund's net asset value (price)
per share next computed after a purchase order becomes effective
and payment has been received by the Fund. Normally, but not
necessarily, this price will be $1.00. (See "How Share Price
is Determined.") In the case of certain institutions which
have made satisfactory payment arrangements with the Fund, orders
may be processed at the net asset value per share next effective
after a purchase order has been received by the Fund.
A purchase order becomes effective when it has been determined
that the Fund has received unconditional payment in the form of
federal funds or such payment has been converted to federal funds
and accepted by the Fund. Payments transmitted by federal funds
wire can be accepted and effective upon receipt. Payments
transmitted by other bank wire may take longer to be converted to
federal funds. Money transmitted by check is normally converted
into federal funds on the second business day following receipt.
(Federal funds are deposits made by member banks of the Federal
Reserve System with the Federal Reserve Bank which can be
electronically transferred from one member bank to another.)
The Fund reserves the right in its sole discretion to withdraw
all or any part of the offerings made by the prospectus or to
reject purchase orders when, in the judgment of management, such
withdrawal or rejection is in the best interest of the Fund and
its shareholders. The Fund also reserves the right at any time to
waive or increase the minimum requirements applicable to initial
or subsequent investments with respect to any person or class of
persons, which includes shareholders of the Fund's special
investment programs. The Fund reserves the right to refuse to
accept orders for fund shares unless accompanied by payment,
except when a responsible person has indemnified the Fund against
losses resulting from the failure of investors to make payment.
In the event that the Fund sustains a loss as the result of
failure by a purchaser to make payment, the Fund's underwriter,
Jones & Babson, Inc. will cover the loss.
INITIAL INVESTMENTS
Initial investments - By mail. You may open an account and make
an investment by completing and signing the application which
accompanies this prospectus. Make your check ($1,000 minimum for
each Portfolio selected unless your purchase is pursuant to an
IRA or the Uniform Transfers (Gifts) to Minors Act in which case
the minimum initial purchase is $250 for each Portfolio selected)
payable to UMB Bank, n.a. Mail your application and check to:
D.L. Babson Money Market Fund, Inc.
Three Crown Center
2440 Pershing Road, Suite G-15
Kansas City, Missouri 64108
Initial investments - By wire. You may purchase shares of the
Fund by wiring the purchase price ($1,000 minimum for each
Portfolio selected) through the Federal Reserve Bank to the
custodian, UMB Bank, n.a. Prior to sending your money, you must
call the Fund toll free 1-800-4-BABSON (1-800-422-2766), or in
the Kansas City area 471-5200 and provide it with the identity of
the registered account owner, the registered address, the Social
Security or Taxpayer Identification Number of the registered
owner, the amount being wired, the name and telephone number of
the wiring bank and the person to be contacted in connection with
the order. You will then be provided a Fund account number, after
which you should instruct your bank to wire the specified amount,
along with the account number and the account registration to:
UMB Bank, n.a.
Kansas City, Missouri, ABA #101000695
For Babson Money Market Fund, Inc.
Federal Portfolio/AC = 980103-3883
Prime Portfolio/AC = 980103-3581
For Account No. (insert assigned Fund account
number and name in which account is registered.)
A completed application must be sent to the Fund as soon as
possible so the necessary remaining information can be recorded
in your account. No redemptions can occur until this is done.
INVESTMENTS SUBSEQUENT TO INITIAL INVESTMENT
You may add to your Fund account at any time in amounts of $100
or more if purchases are made by mail, or $1,000 or more if
purchases are made by wire or telephone. Automatic monthly
investments must be in amounts of $100 or more.
Checks should be mailed to the Fund at its address, but make them
payable to UMB Bank, n.a. Always identify your account number or
include the detachable reminder stub which accompanies each
confirmation.
Wire share purchases should include your account registration,
your account number and the Babson Fund (Portfolio) in which you
are purchasing shares. It also is advisable to notify the Fund by
telephone that you have sent a wire purchase order to the bank.
TELEPHONE INVESTMENT SERVICE
To use the Telephone Investment Service, you must first establish
your Fund account and authorize telephone orders in the
application form, or, subsequently, on a special authorization
form provided upon request. If you elect the Telephone Investment
Service, you may purchase Fund shares by telephone and authorize
the Fund to draft your checking account for the cost of the
shares so purchased. You will receive the next available price
after the Fund has received your telephone call. Availability and
continuance of this privilege is subject to acceptance and
approval by the Fund and all participating banks. During periods
of increased market activity, you may have difficulty reaching
the Fund by telephone, in which case you should contact the Fund
by mail or telegraph. The Fund will not be responsible for the
consequences of delays including delays in the banking or Federal
Reserve wire systems.
The Fund will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine, and if such
procedures are not followed, the Fund may be liable for losses
due to unauthorized or fraudulent instructions. Such procedures
may include, but are not limited to requiring personal
identification prior to acting upon instructions received by
telephone, providing written confirmations of such transactions,
and/or tape recording of telephone instructions.
The Fund reserves the right to initiate a charge for this service
and to terminate or modify any or all of the privileges in
connection with this service at any time upon 15 days written
notice to shareholders, and to terminate or modify the privileges
without prior notice in any circumstances where such termination
or modification is in the best interest of the Fund and its
investors.
AUTOMATIC MONTHLY INVESTMENT PLAN
You may elect to make monthly investments in a constant dollar
amount from your checking account ($100 minimum). The Fund will
draft your checking account on the same day each month in the
amount you authorize in your application, or, subsequently, on a
special authorization form provided upon request. Availability
and continuance of this privilege is subject to acceptance and
approval by the Fund and all participating banks. If the date
selected falls on a day upon which the Fund shares are not
priced, investment will be made on the first date thereafter upon
which Fund shares are priced. The Fund will not be responsible
for the consequences of delays including delays in the banking or
Federal Reserve wire systems.
The Fund reserves the right to initiate a charge for this service
and to terminate or modify any or all of the privileges in
connection with this service at any time upon 15 days written
notice to shareholders, and to terminate or modify the privileges
without prior notice in any circumstances where such termination
or modification is in the best interest of the Fund and its
investors.
HOW TO REDEEM SHARES
Shareholders registered in the stock records of the Fund may
withdraw all or part of their investment by redeeming shares for
which the Fund has received unconditional payment in the form of
federal funds or such payment has been converted to federal funds
and accepted by the Fund. For your convenience, and to enable
your account to continue earning daily dividends as long as
possible, the Fund offers expedited redemption procedures by
telephone/telegraph and draft ("check"), in addition to
normal mail procedures.
In each instance you must comply with the general requirements
relating to all redemptions as well as with specific requirements
set out for the particular redemption method you select. If you
wish to expedite redemptions by using the telephone/telegraph or
draft writing (check) privileges, you should carefully note the
special requirements and limitations relating to these methods.
If an investor wishes to engage the services of any other broker
to redeem (or purchase) shares of the Fund, a fee may be charged
by such broker.
Where additional documentation is normally required to support
redemptions as in the case of corporations, fiduciaries, and
others who hold shares in a representative or nominee capacity
such as certified copies of corporate resolutions, or
certificates of incumbency, or such other documentation as may be
required under the Uniform Commercial Code or other applicable
laws or regulations, it is the responsibility of the shareholder
to maintain such documentation on file and in a current status. A
failure to do so will delay the redemption. If you have questions
concerning redemption requirements, please write or telephone the
Fund well ahead of an anticipated redemption in order to avoid
any possible delay.
Requests which are subject to special conditions or which specify
an effective date other than as provided herein cannot be
accepted. All redemption requests must be transmitted to the Fund
at Three Crown Center, 2440 Pershing Road, Suite G-15, Kansas
City, Missouri 64108. Shareholders who have authorized telephone
redemption may call toll free 1-800-4-BABSON (1-800-422-2766), or
in the Kansas City area 471-5200. The Fund will redeem shares at
the price (net asset value per share) next computed after receipt
of a redemption request in "good order." Normally this
price will be $1.00. (For more information on how the Fund
intends to maintain a constant price see "How Share Price is
Determined," page 14.)
The Fund will endeavor to transmit redemption proceeds to the
proper party, as instructed, as soon as practicable after a
redemption request has been received in "good order" and
accepted, but in no event later than the seventh day thereafter.
Transmissions are made by mail unless an expedited method has
been authorized and specified in the redemption request. The Fund
will not be responsible for the consequences of delays including
delays in the banking or Federal Reserve wire systems.
Redemptions will not become effective until all documents in the
form required have been received. In the case of redemption
requests made within 15 days of the date of purchase, the Fund
will delay transmission of proceeds until such time as it is
certain that unconditional payment in federal funds has been
collected for the purchase of shares being redeemed or 15 days
from the date of purchase. You can avoid the possibility of delay
by paying for all of your purchases with a transfer of federal
funds.
Shares redeemed will be entitled to receive all dividends
declared through the date of redemption. If you redeem all of the
shares in your account, in addition to the share redemption
check, a separate check representing all dividends declared but
unpaid on the shares redeemed will be distributed on the next
dividend payment date, according to your dividend instructions on
file with the Fund. Any amount due you in your declared but
unpaid dividend account cannot be redeemed by draft.
Signature Guarantees are required in connection with all
redemptions by mail, or changes in share registration, except as
hereinafter provided. These requirements may be waived by the
Fund in certain instances where it appears reasonable to do so
and will not unduly affect the interests of other shareholders.
Signature(s) must be guaranteed by an "eligible Guarantor
institution" as defined under Rule 17Ad-15 under the Securities
Exchange Act of 1934. Eligible guarantor institutions include:
(1) national or state banks, savings associations, savings and
loan associations, trust companies, savings banks, industrial
loan companies and credit unions; (2) national securities
exchanges, registered securities associations and clearing
agencies; or (3) securities broker/dealers which are members of a
national securities exchange or clearing agency or which have a
minimum net capital of $100,000. A notarized signature will not
be sufficient of the request to be in proper form.
Signature guarantees will be waived for mail redemptions of
$10,000 or less, but they will be required if the checks are to
be payable to someone other than the registered owner(s), or are
to be mailed to an address different from the registered address
of the shareholder(s), or where there appears to be a pattern of
redemptions designed to circumvent the signature guarantee
requirement, or where the Fund has other reason to believe that
this requirement would be in the best interests of the Fund and
its shareholders.
The right of redemption may be suspended or the date of payment
postponed beyond the normal seven-day period when the New York
Stock Exchange is closed or under emergency circumstances as
determined by the Securities and Exchange Commission. Further,
the Fund reserves the right to redeem its shares in kind under
certain circumstances. If the shares are redeemed in kind, the
shareholder may incur brokerage costs when converting into cash.
Additional details are set forth in the Statement of
Additional Information.
Due to the high cost of maintaining smaller accounts, the Board
of Directors has authorized the Fund to close shareholder
accounts where their value falls below the current minimum
initial investment requirement at the time of initial purchase as
a result of redemptions and not as the result of market action,
and remains below this level for 60 days after each such
shareholder account is mailed a notice of: (1) the Fund s
intention to close the account, (2) the minimum account size
requirement, and (3) the date on which the account will be closed
if the minimum size requirement is not met.
Withdrawal By Mail - Shares may be redeemed by mailing your
request to the Fund. To be in "good order" the request
must include the following:
(1) A written redemption request or stock assignment (stock
power) containing the genuine signature of each registered owner
exactly as the shares are registered with clear identification of
the account by registered name(s) and account number and the
number of shares or the dollar amount to be redeemed;
(2) any outstanding stock certificates representing shares
to be redeemed;
(3) signature guarantees as required; and (See Signature
Guarantees on page 10.)
(4) any additional documentation which the Fund may deem
necessary to insure a genuine redemption.
Withdrawal By Telephone or Telegraph - You may withdraw any
amount of $1,000 or more by telephone toll free 1-800-4-BABSON
(1-800-422-2766), or in the Kansas City area 471-5200, or by
telegram to the Fund's address. Telephone/telegraph redemption
authorization signed by all registered owners with signatures
guaranteed must be on file with the Fund before you may redeem by
telephone or telegraph. The signature guarantee requirement may
be waived by the Fund if the request for this redemption method
is made at the same time the initial application to purchase
shares is submitted.
All communications must include the Fund's name, Portfolio name,
your account number, the exact registration of your shares, the
number of shares or dollar amount to be redeemed, and the
identity of the bank and bank account (name and number) to which
the proceeds are to be wired. This procedure may only be used for
non-certificated shares held in open account. For the protection
of shareholders, your redemption instructions can only be changed
by filing with the Fund new instructions on a form obtainable
from the Fund which must be properly signed with signature(s)
guaranteed.
Telephone or telegraph redemption proceeds may be transmitted to
your pre-identified bank account either by wire or mail to a
domestic commercial bank which is a member of the Federal Reserve
System as designated by you on your pre-authorization form. If
you elect to have proceeds wired to your bank, and your request
is received prior to 1:00 P.M. (Eastern Time), proceeds normally
will be wired the following business day. If your request is
received during the day thereafter, proceeds normally will be
wired on the second business day following the day of receipt of
your request. It is the Fund s present policy not to assess wire
charges on amounts of $5,000 or more. A charge of $5.00 normally
will be made on lesser amounts, but this charge may be reduced or
waived in connection with master accounts. The Fund reserves the
right to change this policy or to refuse a telephone or telegraph
redemption request or require additional documentation to assure
a genuine redemption, and, at its option, may pay such redemption
by wire or check and may limit the frequency or the amount of
such request. The Fund reserves the right to terminate or modify
any or all of the services in connection with this privilege at
any time without prior notice. Neither the Fund nor Jones &
Babson, Inc. assumes responsibility for the authenticity of
withdrawal instructions, and there are provisions on the
authorization form limiting their liability in this respect.
Withdrawal by Draft ("Check") - This method of redemption
is limited to open account shares. You may elect this method of
redemption on your initial application, or on a form which will
be sent to you upon request. All signatures must be guaranteed
unless this method of redemption is elected on your initial
application. The authorization form, which all registered owners
must sign, also contains a provision relieving the Fund and Jones
& Babson, Inc. from liability for loss, if any, which you may
sustain arising out of a non-genuine redemption pursuant to this
redemption feature. Any additional documentation required to
assure a genuine redemption must be maintained on file with the
Fund in such current status as the Fund may deem necessary. A new
form properly signed, with signature(s) guaranteed must be
received and accepted by the Fund before authorized redemption
instructions already on file with the Fund can be changed.
When the draft authorization form is received by the Fund in
"good order" and accepted, you will be provided a supply of
drafts ("checks") which may be drawn on the Fund. Drafts must be
deposited in a bank account of the payee to be cleared through
the banking system in order to be presented to the Fund for
payment through UMB Bank, n.a. An additional supply of drafts
will be furnished upon request. There presently is no charge for
these drafts or their clearance. However, the Fund and UMB Bank,
n.a. reserve the right to make reasonable charges and to
terminate or modify any or all of the services in connection with
this privilege at any time and without prior notice.
These drafts must be signed by all registered owners exactly as
the shares are registered, except that if shares are owned in
joint tenancy, drafts may be signed by any one joint owner unless
otherwise indicated on the application. They may be made payable
to the order of any person in any amount ranging from $500 to
$100,000. The bank of the draft payee must present it for
collection through UMB Bank, n.a. which delivers it to the Fund
for redemption of a sufficient number of shares to cover the
amount of the draft. Dividends will be earned by the shareholder
on the draft proceeds until it clears at UMB Bank, n.a. Drafts
will not be honored by the Fund and will be returned unpaid if
there are insufficient open account shares to meet the withdrawal
amount. The Fund reserves the right to withhold the bank's
redemption request until it determines that it has received
unconditional payment in federal funds for at least the number of
shares required to be redeemed to make payment on the draft. If
such a delay is necessary, the bank may return the draft not
accepted (by the Fund) because there are not sufficient shares
for which good payment has been received in the shareholder
account. Dividends declared but not yet paid to you cannot be
withdrawn by drafts. Drafts (checks) written on the Babson Money
Market Fund should not be used as a redemption form or for the
transfer of shares to another Babson Fund unless the registration
of the accounts involved is identical.
SYSTEMATIC REDEMPTION PLAN
If you own shares in an open account valued at $10,000 or more,
and desire to make regular monthly or quarterly withdrawals
without the necessity and inconvenience of executing a separate
redemption request to initiate each withdrawal, you may enter
into a Systematic Withdrawal Plan by completing forms obtainable
from the Fund. For this service, the manager may charge you a fee
not to exceed $1.50 for each withdrawal. Currently the manager
assumes the additional expenses arising out of this type of plan,
but it reserves the right to initiate such a charge at any time
in the future when it deems it necessary. If such a charge is
imposed, participants will be provided 30 days notice.
Subject to a $50 minimum, you may withdraw each period a
specified dollar amount. Shares also may be redeemed at a rate
calculated to exhaust the account at the end of a specified
period of time.
Dividends and capital gains distributions must be reinvested in
additional shares. Under all withdrawal programs, liquidation of
shares in excess of dividends and distributions reinvested will
diminish and may exhaust your account, particularly during a
period of declining share values.
You may revoke or change your plan or redeem all of your
remaining shares at any time. Withdrawal payments will be
continued until the shares are exhausted or until the Fund or you
terminate the plan by written notice to the other.
HOW TO EXCHANGE SHARES BETWEEN
PORTFOLIOS AND BABSON FUNDS
Shareholders may exchange without a waiting period their Fund
shares which are held in open account, and for which good payment
has been received, for identically registered shares of any other
Babson Fund, or any other Portfolio in the Babson Fund Group
which is legally registered for sale in the state of residence of
the investor, except Babson Enterprise Fund, Inc., provided that
the minimum amount exchanged has a value of $1,000 or more and
meets the minimum investment requirement of the Fund or Portfolio
into which it is exchanged.
Effective at the close of business on January 31, 1992, the
Directors of the Babson Enterprise Fund, Inc. took action to
limit the offering of that Fund's shares. Babson Enterprise Fund,
Inc. will not accept any new accounts, including IRAs and other
retirement plans, until further notice, nor will Babson
Enterprise Fund accept transfers from shareholders of other
Babson Funds, who were not shareholders of record of Babson
Enterprise Fund at the close of business on January 31, 1992.
Investors may want to consider purchasing shares in Babson
Enterprise Fund II, Inc. as an alternative.
To authorize the Telephone/Telegraph Exchange Privilege, all
registered owners must sign the appropriate section on the
original application, or the Fund must receive a special
authorization form, provided upon request. During periods of
increased market activity, you may have difficulty reaching the
Fund by telephone, in which case you should contact the Fund by
mail or telegraph. The Fund reserves the right to initiate a
charge for this service and to terminate or modify any or all of
the privileges in connection with this service at any time and
without prior notice under any circumstances where continuance of
these privileges would be detrimental to the Fund or its
shareholders such as an emergency, or where the volume of such
activity threatens the ability of the Fund to conduct business,
or under any other circumstances, upon 60 days written notice to
shareholders. The Fund will not be responsible for the
consequences of delays including delays in the banking or Federal
Reserve wire systems.
The Fund will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine, and if such
procedures are not followed, the Fund may be liable for losses
due to unauthorized or fraudulent instructions. Such procedures
may include, but are not limited to requiring personal
identification prior to acting upon instructions received by
telephone, providing written confirmations of such transactions,
and/or tape recording of telephone instructions.
Exchanges by mail may be accomplished by a written request
properly signed by all registered owners identifying the account,
the number of shares or dollar amount to be redeemed for
exchange, and the Babson Fund into which the account is being
transferred.
If you wish to exchange part or all of your shares in the Fund
for shares of another Fund or Portfolio in the Babson Fund Group,
you should review the prospectus of the Fund to be purchased
which can be obtained from Jones & Babson, Inc. Any such exchange
will be based on the respective net asset values of the shares
involved. An exchange between Funds or Portfolios involves the
sale of an asset. Unless the shareholder account is tax-deferred,
this is a taxable event.
HOW SHARE PRICE IS DETERMINED
In order to determine the price at which new shares will be sold
and at which issued shares presented for redemption will be
liquidated, the net asset value per share of each Portfolio is
computed once daily, Monday through Friday, at the specific time
during the day that the Board of Directors sets at least
annually, except on days on which changes in the value of
portfolio securities will not materially affect the net asset
value, or days during which no security is tendered for
redemption and no order to purchase or sell such security is
received by the Fund, or customary holidays. For a list of the
holidays during which the Fund is not open for business, see
"How Share Price is Determined" in the "Statement of
Additional Information."
The price at which new shares of the Fund will be sold and at
which issued shares presented for redemption will be liquidated
is computed once daily at 1:00 P.M. (Eastern Time), except on
those days when the Fund is not open for business.
The per share calculation is made by subtracting from each
Portfolio's total assets any liabilities and then dividing into
this amount the total outstanding shares as of the date of the
calculation.
Normally each Portfolio's price will be $1.00 because the Fund
will adhere to a number of procedures designed, but not
guaranteed, to maintain a constant price of $1.00 per share.
Although unlikely, it still is possible that the value of the
shares you redeem may be more or less than your cost depending on
the market value of the Portfolio's securities at the time a
redemption becomes effective.
For the purpose of calculating each Portfolio's net asset value
per share, securities are valued by the "amortized cost"
method of valuation, which does not take into consideration
unrealized 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 the Portfolio would receive if
it sold the instrument. During periods of declining interest
rates, the daily yield on shares of the Portfolio computed as
described above 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 its portfolio instruments. Thus, if the use of amortized cost
by the Portfolio resulted in a lower aggregate value on a
particular day, a prospective investor in the Portfolio would be
able to obtain a somewhat higher yield than would result from
investment in a fund utilizing market values, and existing
investors in the Portfolio would receive less investment income.
The converse would apply in a period of rising interest rates.
The use of amortized cost and the maintenance of each Portfolio's
per share net asset value at $1.00 is based on its election to
operate under the provisions of Rule 2a-7 under the Investment
Company Act of 1940. To assure compliance with adopted procedures
pursuant to Rule 2a-7 under the Investment Company Act of 1940
(the "1940 Act"), the Fund will only invest in U.S.
dollar denominated securities with remaining maturities of 397
days or less, maintain the dollar weighted average maturity of
the securities in the Fund's portfolio at 90 days or less and
limit its investments to those instruments which the Directors of
the Fund determines present minimal credit risks and which are
eligible investments under the rule.
The Directors have established procedures designed to maintain
the Portfolios' price per share, as computed for the purpose of
sales and redemptions, at $1.00. These procedures include a
review of the Portfolios' holdings by the Directors at such
intervals as they deem appropriate to determine whether the
Portfolios' net asset value calculated by using available market
quotations deviates from $1.00 per share based on amortized cost.
If any deviation exceeds one-half of one percent, the Directors
will promptly consider what action, if any, will be initiated. In
the event the Directors determine that a deviation exists which
may result in material dilution or other unfair results to
investors or existing shareholders, they have agreed to 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; withhold dividends; make a special capital
distribution; redeem shares in kind; or establish net asset value
per share using available market quotations.
There are various methods of valuing the assets and of paying
dividends and distributions from a money market fund. Each
Portfolio values its assets at amortized cost while also
monitoring the available market bid prices, or yield equivalents.
Since dividends from net investment income will be accrued daily
and paid monthly, the net asset value per share of each
Portfolio's daily dividends will vary in amount.
OFFICERS AND DIRECTORS
The officers of the Fund manage its day-to-day operations. The
Fund's manager and its officers are subject to the supervision
and control of the Board of Directors. A list of the officers and
directors of the Fund and a brief statement of their present
positions and principal occupations during the past five years is
set forth in the "Statement of Additional Information."
MANAGEMENT AND INVESTMENT COUNSEL
Jones & Babson, Inc. was founded in 1960. It organized the Fund
in 1979, and acts as its manager and principal underwriter.
Pursuant to the current Management Agreement, Jones & Babson,
Inc. provides or pays the cost of all management, supervisory and
administrative services required in the normal operation of the
Fund. This includes investment management and supervision; fees
of the custodian, independent public accountants and legal
counsel; remuneration of officers, directors and other personnel;
rent; shareholder services, including maintenance of the
shareholder accounting system and transfer agency; and such other
items as are incidental to corporate administration.
Not considered normal operating expenses, and therefore payable
by the Fund, are taxes, interest, governmental charges and fees,
including registration of the Fund and its shares with the
Securities and Exchange Commission and the Securities Departments
of the various States, brokerage costs, dues, and all
extraordinary costs and expenses including but not limited to
legal and accounting fees incurred in anticipation of or arising
out of litigation or administrative proceedings to which the
Fund, its officers or directors may be subject or a party
thereto.
As a part of the Management Agreement, Jones & Babson, Inc.
employs at its own expense David L. Babson & Co. Inc. as its
investment counsel to assist in the investment advisory function.
David L. Babson & Co. Inc. is an independent investment
counseling firm founded in 1940. It serves a broad variety of
individual, corporate and other institutional clients by
maintaining an extensive research and analytical staff. It has an
experienced investment analysis and research staff which
eliminates the need for Jones & Babson, Inc. and the Fund to
maintain an extensive duplicate staff, with the consequent
increase in the cost of investment advisory service. The cost of
the services of David L. Babson & Co. Inc. is included in the fee
of Jones & Babson, Inc. The Management Agreement limits the
liability of the manager and its investment counsel, as well as
their officers, directors and personnel, to acts or omissions
involving willful malfeasance, bad faith, gross negligence, or
reckless disregard of their duties. Brian F. Reynolds has been
the portfolio manager of both the Federal and Prime Portfolios of
D.L. Babson Money Market Fund since 1986. He is a Chartered
Financial Analyst. He joined David L. Babson & Co. in 1984 and
has eleven years investment management experience.
As compensation for the services provided by Jones & Babson,
Inc., the Fund pays Jones & Babson, Inc. a fee at the annual rate
of 85/100 of one percent (.85%) of its average daily net assets,
which is computed daily and paid semimonthly, from which Jones &
Babson, Inc. pays David L. Babson & Co. Inc. a fee of 20/100 of
one percent (.20%).
The annual fee charged by Jones & Babson, Inc. is higher than the
fees of most other investment advisers whose charges cover only
investment advisory services with all remaining operational
expenses absorbed directly by the Fund. Yet, it compares
favorably with these other advisers when all expenses to Fund
shareholders are taken into account. The total expenses of the
Fund for the fiscal year ended June 30, 1995, amounted to ___%
and ___%, respectively, of the average net assets of the Prime
and Federal Portfolios. Per share expenses of both series may
differ due to differences in registration fees.
Certain officers and directors of the Fund are also officers or
directors or both of other Babson Funds, Jones & Babson, Inc. or
David L. Babson & Co. Inc.
Jones & Babson, Inc. is a wholly-owned subsidiary of Business
Men's Assurance Company of America, which is considered to be a
controlling person under the Investment Company Act of 1940.
Assicurazioni Generali S.p.A., an insurance organization founded
in 1831 based in Trieste, Italy, is considered to be a
controlling person and is the ultimate parent of Business Men's
Assurance Company of America. Mediobanca is a 5% owner of
Generali.
David L. Babson & Co. Inc. is a closely held corporation and has
limitations in the ownership of its stock designed to maintain
control in those who are active in management.
On June 30, 1995, David L. Babson & Co. Inc.,
the investment counsel, became a wholly-owned
subsidiary of Massachusetts Mutual Life
Insurance Company, a leading provider of
individual life insurance. annuities, employee
group life, health, pension and investment
services headquartered in Springfield,
Massachusetts. There were no changes to the
personnel of David L. Babson & Co. Inc. and no
changes in the investment policies or operations
of the Funds.
The current Management Agreement between the Fund and Jones &
Babson, Inc., which includes the Investment Counsel Agreement
between Jones & Babson, Inc. and David L. Babson & Co. Inc., will
continue in effect until October 31, 1996, and will continue
automatically for successive annual periods ending each October
31 so long as such continuance is specifically approved at least
annually by the Board of Directors of the Fund or by the vote of
a majority of the outstanding voting securities of the Fund, and,
provided also that such continuance is approved by the vote of a
majority of the directors who are not parties to the Agreements
or interested persons of any such party at a meeting held in
person and called specifically for the purpose of evaluating and
voting on such approval. Both Agreements provide that either
party may terminate by giving the other 60 days written notice.
The Agreements terminate automatically if assigned by either
party.
GENERAL INFORMATION AND HISTORY
The Fund, incorporated in Maryland on October 19, 1979, has a
present authorized capitalization of 2,000,000,000 shares of $.01
par value common stock. Half of the shares are presently reserved
for issuance to shareholders invested in the Federal Portfolio
and half are reserved for the Prime Portfolio shareholders. Each
full and fractional share, when issued and outstanding, has: (1)
equal voting rights with respect to matters which affect the Fund
in general and with respect to matters relating solely to the
interests of the Portfolio for which issued, and (2) equal
dividend, distribution and redemption rights to the assets of the
Portfolio for which issued and to general assets, if any, of the
Fund which are not specifically allocated to a particular
Portfolio. Shares when issued are fully paid and non-assessable.
Except for the priority of each share in the assets of its
Portfolio, the Fund will not issue any class of securities senior
to any other class. Shareholders do not have pre-emptive or
conversion rights. The Fund may issue additional series of stock
with the approval of the Fund's Board of Directors.
Non-cumulative voting - These shares have non-cumulative voting
rights, which means that the holders of more than 50% of the
shares voting for the election of directors can elect 100% of the
directors, if they choose to do so, and in such event, the
holders of the remaining less than 50% of the shares voting will
not be able to elect any directors. Each series will vote
separately on investment advisory agreements, changes in
fundamental policies, and other matters affecting each series
separately.
The Maryland Statutes permit registered investment companies,
such as the Fund, to operate without an annual meeting of
shareholders under specified circumstances if an annual meeting
is not required by the Investment Company Act of 1940. There are
procedures whereby the shareholders may remove directors. These
procedures are described in the "Statement of Additional
Information" under the caption "Officers and Directors."
The Fund has adopted the appropriate provisions in its By-Laws
and may not, at its discretion, hold annual meetings of
shareholders for the following purposes unless required to do so:
(1) election of directors; (2) approval of any investment
advisory agreement; (3) ratification of the selection of
independent public accountants; and (4) approval of a
distribution plan. As a result, the Fund does not intend to hold
annual meetings.
The Fund may use the name "Babson" in its name so long as
Jones & Babson, Inc. is continued as manager and David L. Babson
& Co. Inc. as its investment counsel. Complete details with
respect to the use of the name are set out in the Management
Agreement between the Fund and Jones & Babson, Inc.
This prospectus omits certain of the information contained in the
registration statement filed with the Securities and Exchange
Commission, Washington, D.C. These items may be inspected at the
offices of the Commission or obtained from the Commission upon
payment of the fee prescribed.
DIVIDENDS, DISTRIBUTIONS AND THEIR TAXATION
At the close of each business day, dividends consisting of
substantially all of each Portfolio's net investment income are
declared payable to shareholders of record at the close of the
previous business day, and credited to their accounts. All daily
dividends declared during a given month will be distributed on
the last day of the month. Dividend and capital gains
distributions, if any, are automatically reinvested in additional
shares at net asset value, unless the shareholder has elected in
writing to receive cash. The method of payment elected remains in
effect until the Fund is notified in writing to the contrary. If
at the time of a complete redemption and closing of a shareholder
account, there is net undistributed income to the credit of the
shareholder, it will be paid by separate check on the next
dividend distribution date. In the case of a partial redemption,
any net undistributed credit will be distributed on the next
dividend date according to the shareholder's instructions on
file with the Fund.
Shares begin earning income on the day following the effective
date of purchase. Income earned by the Fund on weekends, holidays
and other days on which the Fund is closed for business is
declared as a dividend on the next day on which the Fund is open
for business, except for month-ends when such dividend is
declared as of the last day of the month.
Each Portfolio within the Fund has qualified, and intends to
continue to qualify for taxation as a "regulated investment
company" under the Internal Revenue Code so that each
Portfolio will not be subject to federal income tax to the extent
it distributes its income to shareholders. Dividends, either in
cash or reinvested in shares, paid by a Portfolio from net
investment income will be taxable to shareholders as ordinary
income and will not qualify for the 70% dividends-received
deduction for corporations.
Each Portfolio intends to declare and pay dividends so as to
avoid imposition of the federal excise tax. To do so, the Fund
expects to distribute during the calendar year an amount equal
to: (1) 98% of its calendar year ordinary income; and (2) 100% of
any undistributed income from the prior calendar year. Dividends
declared in December by a Portfolio will be deemed to have been
paid by such Portfolio and received by its shareholders on the
record date provided that the dividends are paid before February
1 of the following year.
Promptly after the end of each calendar year, each shareholder
will receive a statement of the federal income tax status of all
dividends and distributions paid during the year.
To comply with IRS regulations, the Fund is required by federal
law to withhold 31% of reportable payments (which may include
dividends, capital gains distributions, and redemptions) paid to
shareholders who have not complied with IRS regulations. In order
to avoid this withholding requirement, shareholders must certify
on their Application, or on a separate form supplied by the Fund,
that their Social Security or Taxpayer Identification Number
provided is correct and that they are not currently subject to
backup withholding, or that they are exempt from backup
withholding.
Shareholders also may be subject to state and local taxes on
distributions from the Fund. You should consult your tax adviser
with respect to the tax status of distributions from the Fund in
your state and locality.
THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED HEREIN FOR GENERAL
INFORMATION ONLY. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN
TAX ADVISERS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF AN
INVESTMENT IN THE FUND.
SHAREHOLDER SERVICES
The Fund and its manager offer shareholders a broad variety of
services described throughout this prospectus. In addition, the
following services are available:
Automatic Monthly Investment - You may elect to make monthly
investments in a constant dollar amount from your checking
account ($100 minimum). The Fund will draft your checking account
on the same day each month in the amount you authorize in your
application, or, subsequently, on a special authorization form
provided upon request.
Automatic Reinvestment - Dividends and capital gains
distributions may be reinvested automatically, or shareholders
may elect to have dividends paid in cash and capital gains
reinvested, or to have both paid in cash. Telephone Investments --
You may make investments of $1,000 or more by telephone if you
have authorized such investments in your application, or,
subsequently, on a special authorization form provided upon
request. See "Telephone Investment Service."
Automatic Exchange - You may exchange shares from your account
($100 minimum) in any of the Babson Funds to an identically
registered account in any other fund in the Babson Group except
Babson Enterprise Fund, Inc. according to your instructions.
Monthly exchanges will be continued until all shares have been
exchanged or until you terminate the Automatic Exchange
authorization. A special authorization form will be provided upon
request.
Transfer of Ownership - A shareholder may transfer shares to
another shareholder account. The requirements which apply to
redemptions apply to transfers. A transfer to a new account must
meet initial investment requirements.
Systematic Redemption Plan - Shareholders who own shares in open
account valued at $10,000 or more may arrange to make regular
withdrawals without the necessity of executing a separate
redemption request to initiate each withdrawal.
Sub-Accounting - Keogh and corporate tax qualified retirement
plans, as well as certain other investors who must maintain
separate participant accounting records, may meet these needs
through services provided by the Fund's manager, Jones & Babson,
Inc. Investment minimums may be met by accumulating the separate
accounts of the group. Although there is currently no charge for
sub-accounting, the Fund and its manager reserve the right to
make reasonable charges for this service.
Prototype Retirement Plans - Jones & Babson, Inc. offers a
defined contribution prototype plan - The Universal Retirement
Plan - which is suitable for all who are self-employed, including
sole proprietors, partnerships, and corporations. The Universal
Prototype includes both money purchase pension and profit-sharing
plan options.
Individual Retirement Accounts - Also available is an Individual
Retirement Account (IRA). The IRA uses the IRS model form of plan
and provides an excellent way to accumulate a retirement fund
which will earn tax-deferred dollars until withdrawn. An IRA may
also be used to defer taxes on certain distributions from
employer-sponsored retirement plans. You may contribute up to
$2,000 of compensation each year ($2,250 if a spousal IRA is
established), some or all of which may be deductible. Consult
your tax adviser concerning the amount of the tax deduction, if
any.
Simplified Employee Pensions (SEPs) - The Jones & Babson IRA may
be used with IRS Form 5305-SEP to establish a SEP-IRA, to which
the self-employed individual may contribute up to 15% of net
earned income or $30,000, whichever is less. A SEP-IRA offers the
employer the ability to make the same level of deductible
contributions as a Profit-Sharing Plan with greater ease of
administration, but less flexibility in plan coverage of
employees.
SHAREHOLDER INQUIRIES
Telephone inquiries may be made toll free to the Fund,
1-800-4-BABSON (1-800-422-2766), or in the Kansas City area
471-5200.
Shareholders may address written inquiries to the Fund at:
D.L. Babson Money Market Fund, Inc.
Three Crown Center
2440 Pershing Road, Suite G-15
Kansas City, MO 64108
AUDITORS
ARTHUR ANDERSEN LLP
Kansas City, Missouri
LEGAL COUNSEL
STRADLEY, RONON, STEVENS & YOUNG
Philadelphia, Pennsylvania
JOHN G. DYER
Kansas City, Missouri
CUSTODIAN
UMB BANK, n.a.
Kansas City, Missouri
TRANSFER AGENT
JONES & BABSON, INC.
Kansas City, Missouri
PART B
D.L. BABSON MONEY MARKET FUND, INC.
STATEMENT OF ADDITIONAL INFORMATION
October 31, 1995
This Statement is not a prospectus but should be read in conjunction
with the Fund s current Prospectus dated October 31, 1995 To obtain
the Prospectus please call the Fund toll free 1-800-4-BABSON
(1-800-422-2766) or in the Kansas City area 471-5200.
TABLE OF CONTENTS
Page
Investment Objective and Policies
Portfolio Transactions
Investment Restrictions
Performance Measures
How the Fund s Shares are Distributed
How Share Purchases are Handled
Redemption of Shares
Signature Guarantees
Management and Investment Counsel
How Share Price is Determined
Officers and Directors
Custodian
Independent Public Accountants
Other Jones & Babson Funds
Money Market Securities Described and Ratings
Financial Statements
INVESTMENT OBJECTIVE AND
POLICIES
The following policies supplement the Fund s
investment objective and policies set forth in the
Prospectus.
PORTFOLIO TRANSACTIONS
Decisions to buy and sell securities for the
Fund are made by Jones & Babson, Inc. pursuant
to recommendations by David L. Babson & Co.
Inc. Officers of the Fund and Jones & Babson,
Inc. are generally responsible for implementing
or supervising these decisions, including
allocation of portfolio brokerage and principal
business as well as the negotiation of
commissions and/or the price of the securities.
In instances where securities are purchased on a
commission basis, the Fund will seek competitive
and reasonable commission rates based on the
circumstances of the trade involved and to the
extent that they do not detract from the quality of
the execution.
In all transactions, it is the Fund s policy to
obtain the best combination of price and execution
commensurate with the circumstances as
viewed at the time.
The Fund expects that purchases and sales of
portfolio securities usually will be principal
transactions. Portfolio securities normally will
be purchased directly from the issuer or in the
over-the-counter market from a principal market
maker for the securities, unless it appears that a
better combination of price and execution may be
obtained elsewhere. Usually there will be no
brokerage commission paid by the Fund for such
purchases. Purchases from underwriters of
portfolio securities will include a commission or
concession paid by the issuer to the underwriter,
and purchases from dealers serving as market
makers will include the spread between the bid
and asked price.
The Fund believes it is in its best interest and
that of its shareholders to have a stable and
continuous relationship with a diverse group of
financially strong and technically qualified
broker-dealers who will provide quality
executions at competitive rates. Broker-dealers
meeting these qualifications also will be selected
for their demonstrated loyalty to the Fund, when
acting on its behalf, as well as for any research or
other services provided to the Fund. The Fund
normally will not pay a higher commission rate
to broker-dealers providing benefits or services to
it than it would pay to broker-dealers who do not
provide it such benefits or services. However,
the Fund reserves the right to do so within the
principles set out in Section 28(e) of the
Securities Act of 1934 when it appears that this
would be in the best interests of the shareholders.
No commitment is made to any broker or
dealer with regard to placing of orders for the
purchase or sale of Fund securities, and no
specific formula is used in placing such business.
Allocation is reviewed regularly by both the
Board of Directors of the Fund and Jones &
Babson, Inc.
Since the Fund does not market its shares
through intermediary brokers or dealers, it is not
the Fund s practice to allocate brokerage or
principal business on the basis of sales of its
shares which may be made through such firms.
However, it may place portfolio orders with
qualified broker-dealers who recommend the
Fund to other clients, or who act as agent in the
purchase of the Fund s shares for their clients.
Research services furnished by broker-dealers
may be useful to the Fund manager and its
investment counsel in serving other clients, as
well as the Fund. Conversely, the Fund may
benefit from research services obtained by the
manager or its investment counsel from the
placement of portfolio brokerage of other clients.
When it appears to be in the best interest of its
shareholders, the Fund may join with other
clients of the manager and its investment counsel
in acquiring or disposing of a portfolio holding.
Securities acquired or proceeds obtained will be
equitably distributed between the Fund and other
clients participating in the transaction. In some
instances, this investment procedure may affect
the price paid or received by the Fund or the size
of the position obtained by the Fund.
The Fund does not intend to purchase
securities solely for short-term trading; nor will
securities be sold for the sole purpose of realizing
gains. A security may be sold and another of
comparable quality purchased at approximately
the same time, however, to take advantage of
what the Fund's manager believes to be a
disparity in the normal yield relationship
between the two securities. In addition, a
security may be sold and another purchased
when, in the opinion of the Fund s management,
a favorable yield spread exists between specific
issues or different market sectors.
Since short-term debt instruments with
maturities of less than one year are excluded
from the calculation of portfolio turnover, the
Fund does not anticipate having a portfolio
turnover ratio.
INVESTMENT RESTRICTIONS
In addition to the investment objective and
portfolio management policies set forth in the
Prospectus under the caption "Investment
Objective and Portfolio Management Policy,"
the following restrictions also may not be
changed without approval of the "holders of a
majority of the outstanding shares" of the Fund
or the affected Portfolio series.
The Fund will not: (1) invest in equity
securities or securities convertible into equities;
(2) purchase the securities of any issuer (other
than obligations issued or guaranteed as to
principal and interest by the government of the
United States, its agencies or instrumentalities)
if, as a result, (a) more than 5% of the Fund s
total assets (taken at current value) would be
invested in the securities of such issuer, or (b) the
Fund would hold more than 10% of any class of
securities of such issuer (for this purpose, all
debts and obligations of an issuer maturing in
less than one year are treated as a single class of
securities); (3) borrow money in excess of 15% of
its total assets taken at market value, and then
only from banks as a temporary measure for
extraordinary or emergency purposes; the Fund
will not borrow to increase income (leveraging)
but only to facilitate redemption requests which
might otherwise require untimely dispositions of
Portfolio securities; the Fund will repay all
borrowings before making additional investments,
and interest paid on such borrowings will
reduce net income; (4) mortgage, pledge or
hypothecate its assets except in an amount up to
15% (10% as long as the Fund s shares are
registered for sale in certain states) of the value
of its total assets but only to secure borrowings
for temporary or emergency purposes; (5) issue
senior securities, as defined in the Investment
Company Act of 1940, as amended; (6)
underwrite securities issued by other persons; (7)
purchase or sell real estate, but this shall not
prevent investment in obligations secured by real
estate; (8) make loans to other persons, except by
the purchase of debt obligations which are
permitted under its investment policy; (9)
purchase securities on margin or sell short; (10)
purchase or retain securities of an issuer if to the
knowledge of the Fund's management those
directors of the Fund, each of whom owns more
than one-half of one percent (.5%) of such
securities, together own more than five percent
(5%) of the securities of such issuer; (11)
purchase or sell commodities or commodity
contracts; (12) write or invest in put, call,
straddle or spread options or invest in interests in
oil, gas or other mineral exploration or
development programs; (13) invest in companies
for the purpose of exercising control; (14) invest
in securities of other investment companies,
except as they may be acquired as part of a
merger, consolidation or acquisition of assets;
(15) invest more than 5% of the value of its total
assets at the time of investment in the securities
of any issuer or issuers which have records of
less than three years continuous operation,
including the operation of any predecessor, but
this limitation does not apply to securities issued
or guaranteed as to interest and principal by the
United States government or its agencies or
instrumentalities; (16) purchase any securities
which would cause more than 25% of the value
of a Portfolio s total net assets at the time of
such purchase to be invested in any one industry;
provided, however, the Prime Portfolio reserves
freedom of action to invest up to 100% of its
assets in certificates of deposit or bankers
acceptances of domestic branches of U.S. banks.
There is no limitation with respect to
investments in U. S. Treasury Bills, or other
obligations issued or guaranteed by the federal
government, its agencies and instrumentalities.
In addition to the fundamental investment
restrictions set out above, in order to comply with
the law or regulations of various States, the Fund
will not engage in the following practices: (1)
invest in securities which are not readily
marketable or in securities of foreign issuers
which are not listed on a recognized domestic or
foreign securities exchange; (2) write put or call
options; (3) invest in oil, gas and other mineral
leases or arbitrage transactions; or (4) purchase
or sell real estate (including limited partnership
interests, but excluding readily marketable
interests in real estate investment trusts or
readily marketable securities of companies which
invest in real estate).
Certain States also require that the Fund's
investments in warrants, valued at the lower of
cost or market, may not exceed 5% of the value
of the Fund's net assets. Included within that
amount, but not to exceed 2% of the value of the
Fund's net assets may be warrants which are not
listed on the New York or American Stock
Exchange. Warrants acquired by the Fund in
units or attached to securities may be deemed to
be without value for purposes of this limitation.
PERFORMANCE MEASURES
Yield
From time to time, each Portfolio of the Fund
may quote its yield in advertisements,
shareholder reports or other communications to
shareholders. Yield information is generally
available by calling the Fund toll free 1-800-4-
BABSON (1-800-422-2766), or in the Kansas
City area 471-5200.
The current annualized yield for each Portfolio
of the Fund is computed by: (a) determining the
net change in the value of a hypothetical pre-
existing account in a Fund having a balance of
one share at the beginning of a seven calendar-
day period for which yield is to be quoted, (b)
dividing the net change by the value of the
account at the beginning of the period to obtain
the base period return, and (c) annualizing the
results (i.e., multiplying the base period return by
365/7). The net change in value of the account
reflects the value of additional shares purchased
with dividends declared on the original share and
any such additional shares, but does not include
realized gains and losses or unrealized
appreciation and depreciation. In addition, each
Fund may calculate a compound effective yield
by adding 1 to the base period return (calculated
as described above, raising the sum to a power
equal to 365/7 and subtracting 1).
For the seven-day period ended June 30, 1995
the current annualized yield of the Federal
Portfolio was ____% and the compound effective
yield was ____%. At June 30, 1995, that
Portfolio s average maturity was __ days. For
the seven-day period ended June 30, 1995, the
current annualized yield of the Prime Portfolio
was ____% and the compound effective yield was
____%. At June 30, 1995, that Portfolio s
average maturity was __ days.
Yield information is useful in reviewing the
Funds performance, but because yields
fluctuate, such information cannot necessarily be
used to compare an investment in a Fund s
shares with bank deposits, savings accounts and
similar investment alternatives which often
provided an agreed or guaranteed fixed yield for
a stated period of time. Shareholders should
remember that yield is a function of the kind and
quality of the instruments in the Funds
portfolios, portfolio maturity, operating expenses
and market conditions. Shares of the Fund are
not insured.
HOW THE FUND'S SHARES ARE
DISTRIBUTED
Jones & Babson, Inc., as agent of the Fund,
agrees to supply its best efforts as sole distributor
of the Fund s shares and, at its own expense, pay
all sales and distribution expenses in connection
with their offering other than registration fees
and other government charges.
Jones & Babson, Inc. does not receive any fee
or other compensation under the distribution
agreement which continues in effect until
October 31, 1996, and which will continue
automatically for successive annual periods
ending each October 31, if continued at least
annually by the Fund's Board of Directors,
including a majority of those Directors who are
not parties to such agreements or interested
persons of any such party. It terminates
automatically if assigned by either party or upon
60 days written notice by either party to the
other.
Jones & Babson, Inc. also acts as sole
distributor of the shares for David L. Babson
Growth Fund, Inc., Babson Enterprise Fund,
Inc., Babson Enterprise Fund II, Inc., D. L.
Babson Tax-Free Income Fund, Inc., Babson
Value Fund, Inc., D. L. Babson Bond Trust,
Shadow Stock Fund, Inc., Babson-Stewart Ivory
International Fund, Inc., UMB Stock Fund, Inc.,
UMB Bond Fund, Inc., UMB Money Market
Fund, Inc., UMB Tax-Free Money Market Fund,
Inc., UMB Heartland Fund, Inc., UMB
WorldWide Fund, Inc. and Buffalo Balanced
Fund, Inc.
HOW SHARE PURCHASES ARE
HANDLED
Each order accepted will be fully invested in
whole and fractional shares, unless the purchase
of a certain number of whole shares is specified,
at the net asset value per share next effective
after the order is accepted by the Fund.
Each investment is confirmed by a year-to-date
statement which provides the details of the
immediate transaction, plus all prior transactions
in your account during the current year. This
includes the dollar amount invested, number of
shares purchased or redeemed, price per share,
and aggregate shares owned. A transcript of all
activity in your account during the previous year
will be furnished each January. By retaining
each annual summary and the last year-to-date
statement, you have a complete detailed history
of your account. A duplicate copy of a past
annual statement is available from Jones &
Babson, Inc. at its cost, subject to a minimum
charge of $5 per account, per year requested.
Normally, the shares which you purchase are
held by the Fund in open account, thereby
relieving you of the responsibility of providing
for the safekeeping of a negotiable share
certificate. Should you have a special need for a
certificate, one will be issued on request for all or
a portion of the whole shares in your account.
There is no charge for the first certificate issued.
A charge of $3.50 will be
made for any replacement certificates issued. In
order to protect the interests of the other
shareholders, share certificates will be sent to
those shareholders who request them only after
the Fund has determined that unconditional
payment for the shares represented by the
certificate has been received by its custodian,
UMB Bank, n.a.
If an order to purchase shares must be
canceled due to non-payment, the purchaser will
be responsible for any loss incurred by the Fund
arising out of such cancellation. To recover any
such loss, the Fund reserves the right to redeem
shares owned by any purchaser whose order is
canceled, and such purchaser may be prohibited
or restricted in the manner of placing further
orders.
The Fund reserves the right in its sole
discretion to withdraw all or any part of the
offering made by the prospectus or to reject
purchase orders when, in the judgment of
management, such withdrawal or rejection is in
the best interest of the Fund and its shareholders.
The Fund also reserves the right at any time to
waive or increase the minimum requirements
applicable to initial or subsequent investments
with respect to any person or class of persons,
which includes shareholders of the Fund's
special investment programs.
REDEMPTION OF SHARES
The right of redemption may be suspended, or
the date of payment postponed beyond the
normal seven-day period by the Fund's Board of
Directors under the following conditions
authorized by the Investment Company Act of
1940: (1) for any period (a) during which the
New York Stock Exchange is closed, other than
customary weekend and holiday closing, or (b)
during which trading on the New York Stock
Exchange is restricted; (2) for any period during
which an emergency exists as a result of which
(a) disposal by the Fund of securities owned by it
is not reasonably practicable, or (b) it is not
reasonably practicable for the Fund to determine
the fair value of its net assets; or (3) for such
other periods as the Securities and Exchange
Commission may by order permit for the
protection of the Fund's shareholders.
SIGNATURE GUARANTEES
Signature guarantees normally reduce the
possibility of forgery and are required in
connection with each redemption method to
protect shareholders from loss. Signature
guarantees are required in connection with all
redemptions by mail or changes in share
registration, except as provided in the
Prospectus.
Signature guarantees must appear together
with the signature(s) of the registered owner(s),
on:
(1) a written request for redemption,
(2) a separate instrument of assignment,
which should specify the total number of
shares to be redeemed (this "stock
power" may be obtained from the Fund
or from most banks or stock brokers), or
(3) all stock certificates tendered for
redemption.
MANAGEMENT AND INVESTMENT
COUNSEL
As a part of the Management Agreement,
Jones & Babson, Inc. employs at its own expense
David L. Babson & Co. Inc., as its investment
counsel. David L. Babson & Co. Inc. was
founded in 1940. It is a private investment
research and counseling organization serving
individual, corporate and other institutional
clients. It participates with Jones & Babson in
the management of nine Babson no-load mutual
funds in addition to UMB Money Market Fund,
Inc. and UMB Tax-Free Money Market Fund,
Inc.
The aggregate management fee paid to Jones
& Babson, Inc. during the most recent fiscal year
ended June 30, 1995, from which Jones &
Babson, Inc. paid all the Fund s expenses except
those payable directly by the Fund, was
$_______. The .85% annual fee charged by
Jones & Babson, Inc. covers all normal operating
costs of the Fund. As a result, it is higher than
the fees of some other advisers whose charges
cover only investment advisory services with all
remaining operational expenses absorbed directly
by the Fund. Yet, Jones & Babson s charges
compare favorably with those other advisors
when all expenses to Fund shareholders (i.e.,
operating expenses as a percent of average net
assets) are taken into account.
David L. Babson & Co. Inc. has an
experienced investment analysis and research
staff which eliminates the need for Jones &
Babson, Inc. and the Fund to maintain an
extensive duplicate staff, with the consequent
increase in the cost of investment advisory
service. The cost of the services of David L.
Babson & Co. Inc. is included in the services of
Jones & Babson, Inc. For its investment
supervisory services and counsel, Jones &
Babson, Inc. pays David L. Babson & Co. Inc. a
fee computed on an annual basis at the rate of
20/100 (.20%) of the average daily total net
assets of the Fund. During the most recent fiscal
year ended June 30, 1994, Jones & Babson, Inc.
paid David L. Babson & Co. Inc. fees amounting
to $102,927.
HOW SHARE PRICE IS DETERMINED
The net asset value per share of each Fund
Portfolio is computed once daily, Monday
through Friday, at the specific time during the
day that the Board of Directors of each Fund sets
at least annually, except on days on which
changes in the value of a Fund s portfolio
securities will not materially affect the net asset
value, or days during which no security is
tendered for redemption and no order to
purchase or sell such security is received by the
Fund, or the following holidays:
New Year s Day January 1
Martin Luther Third Monday
King Day in January
Presidents Holiday Third Monday
in February
Good Friday Friday before Easter
Memorial Day Last Monday in May
Independence Day July 4
Labor Day First Monday
in September
Columbus Day Second Monday
in October
Veterans Day November 11
Thanksgiving Day Fourth Thursday
in November
Christmas Day December 25
OFFICERS AND DIRECTORS
The Fund is managed by Jones & Babson, Inc.
subject to the supervision and control of the
Board of Directors. the following table lists the
Officers and Directors of the Fund. Unless noted
otherwise, the address of each Officer and
Director is Three Crown Center, 2440 Pershing
Road, Suite G-15, Kansas City, Missouri 64108.
Except as indicated, each has been an employee
of Jones & Babson, Inc. for more than five years.
* Larry D. Armel, President and Director.
President and Director, Jones & Babson, Inc.,
David L. Babson Growth Fund, Inc., D. L.
Babson Tax-Free Income Fund, Inc., Babson
Enterprise Fund, Inc., Babson Enterprise Fund
II, Inc., Babson Value Fund, Inc., Shadow
Stock Fund, Inc., Babson-Stewart Ivory
International Fund, Inc., UMB Stock Fund,
Inc. UMB Bond Fund, Inc., UMB Money
Market Fund, Inc., UMB Tax-Free Money
Market Fund, Inc., UMB Heartland Fund, Inc.,
UMB WorldWide Fund, Inc., Buffalo
Balanced Fund, Inc.; President and Trustee, D.
L. Babson Bond Trust.
Francis C. Rood, Director.
Retired, 6429 West 92nd Street, Overland
Park, Kansas 66212. Formerly, Group Vice
President-Administration of Hallmark Cards,
Inc.; Director, David L. Babson Growth Fund,
Inc., D.L. Babson Tax-Free Income Fund, Inc.,
Babson Enterprise Fund, Inc., Babson
Enterprise Fund II, Inc., Babson Value Fund,
Inc., Shadow Stock Fund, Inc., Buffalo
Balanced Fund, Inc.; Trustee, D.L. Babson
Bond Trust.
_________________________________________
* Directors who are interested persons as that
term is defined in the Investment Company
Act of 1940, as amended.
William H. Russell, Director.
Financial Consultant, 645 West 67th Street,
Kansas City, Missouri 64113, previously Vice
President, United Telecommunications, Inc.;
Director, David L. Babson Growth Fund, Inc., D.
L. Babson Tax-Free Income Fund, Inc., Babson
Enterprise Fund, Inc., Babson Enterprise Fund
II, Inc., Babson Value Fund, Inc., Shadow Stock
Fund, Inc., Babson-Stewart Ivory International
Fund, Inc., Buffalo Balanced Fund, Inc.; Trustee,
D. L. Babson Bond Trust.
H. David Rybolt, Director.
Consultant, HDR Associates, P.O. Box 2468,
Shawnee Mission, Kansas 66202; Director,
David L. Babson Growth Fund, Inc., D.L.
Babson Tax-Free Income Fund, Inc., Babson
Enterprise Fund, Inc., Babson Enterprise Fund
II, Inc., Babson Value Fund, Inc., Shadow Stock
Fund, Inc., Buffalo Balanced Fund, Inc.; Trustee,
D.L. Babson Bond Trust.
P. Bradley Adams, Vice President and
Treasurer.
Vice President and Treasurer, Jones & Babson,
Inc., David L. Babson Growth Fund, Inc., D.L.
Babson Tax-Free Income Fund, Inc., Babson
Enterprise Fund, Inc., Babson Enterprise Fund
II, Inc., Babson Value Fund, Inc., Shadow Stock
Fund, Inc., Babson-Stewart Ivory International
Fund, Inc., D.L. Babson Bond Trust, UMB Stock
Fund, Inc., UMB Bond Fund, Inc., UMB Money
Market Fund, Inc., UMB Tax-Free Money
Market Fund, Inc., UMB Heartland Fund, Inc.,
UMB WorldWide Fund, Inc., Buffalo Balanced
Fund, Inc.
Michael A. Brummel, Vice President,
Assistant Secretary and Assistant Treasurer.
Vice President, Jones & Babson, Inc., David L.
Babson Growth Fund, Inc., D.L. Babson Tax-
Free Income Fund, Inc., Babson Enterprise Fund,
Inc., Babson Enterprise Fund II, Inc., Babson
Value Fund, Inc., Shadow Stock Fund, Inc.,
Babson-Stewart Ivory International Fund, Inc.,
D.L. Babson Bond Trust, UMB Stock Fund, Inc.,
UMB Bond Fund, Inc., UMB Money Market
Fund, Inc., UMB Tax-Free Money Market Fund,
Inc., UMB Heartland Fund, Inc., UMB
WorldWide Fund, Inc., Buffalo Balanced Fund,
Inc.
Martin A. Cramer, Vice President and
Secretary.
Vice President and Secretary, Jones & Babson,
Inc., David L. Babson Growth Fund, Inc., D.L.
Babson Tax-Free Income Fund, Inc., Babson
Enterprise Fund, Inc., Babson Enterprise Fund
II, Inc., Babson Value Fund, Inc., Shadow Stock
Fund, Inc., Babson-Stewart Ivory International
Fund, Inc., D.L. Babson Bond Trust, UMB Stock
Fund, Inc., UMB Bond Fund, Inc., UMB Money
Market Fund, Inc., UMB Tax-Free Money
Market Fund, Inc., UMB Heartland Fund, Inc.,
UMB WorldWide Fund, Inc., Buffalo Balanced
Fund, Inc.
Ruth Evans, Vice President.
Vice President, Jones & Babson, Inc. David L.
Babson Growth Fund, Inc., D.L. Babson Tax-
Free Income Fund, Inc., Babson Enterprise Fund,
Inc., Babson Enterprise Fund II, Inc., Babson
Value Fund, Inc., Shadow Stock Fund, Inc.,
Babson-Stewart Ivory International Fund, Inc.,
D.L. Babson Bond Trust, UMB Stock Fund, Inc.,
UMB Bond Fund, Inc., UMB Money Market
Fund, Inc., UMB Tax-Free Money Market Fund,
Inc., UMB Heartland Fund, Inc., UMB
WorldWide Fund, Inc., Buffalo Balanced Fund,
Inc.
Edward L. Martin, Vice President-Portfolio.
Senior Vice President, David L. Babson & Co.
Inc., One Memorial Drive, Cambridge,
Massachusetts 02142; Vice President-Portfolio,
D. L. Babson Tax-Free Income Fund, Inc., D. L.
Babson Bond Trust.
None of the officers or directors will be
remunerated by the Fund for their normal duties
and services. Their compensation and expenses
arising out of normal operations will be paid by
Jones & Babson, Inc. under the provisions of the
Management Agreement.
Messrs. Rood, Russell and Rybolt have no
financial interest in, nor are they affiliated with,
either Jones & Babson, Inc. or David L. Babson
& Co. Inc.
The Audit Committee of the Board of
Directors is composed of Messrs. Rood, Russell
and Rybolt.
The Officers and Directors of the Fund as a
group own less than 1% of the Fund.
The Fund will not hold annual meetings
except as required by the Investment Company
Act of 1940 and other applicable laws. The
Fund is a Maryland corporation. Under
Maryland law, a special meeting of stockholders
of the Fund must be held if the Fund receives the
written request for a meeting from the
stockholders entitled to cast at least 25 percent of
all the votes entitled to be cast at the meeting.
The Fund has undertaken that its Directors will
call a meeting of stockholders if such a meeting
is requested in writing by the holders of not less
than 10% of the outstanding shares of the Fund.
To the extent required by the undertaking, the
Fund will assist shareholder communications in
such matters.
CUSTODIAN
The Fund s assets are held for safekeeping by
an independent custodian, UMB Bank, n.a. This
means the bank, rather than the Fund, has
possession of the Fund's cash and securities.
The custodian bank is not responsible for the
Fund's investment management or
administration. But, as directed by the Fund's
officers, it delivers cash to those who have sold
securities to the Fund in return for such
securities, and to those who have purchased
securities from the Fund, it delivers such
securities in return for their cash purchase price.
It also collects income directly from issuers of
securities owned by the Fund and holds this for
payment to shareholders after deduction of the
Fund's expenses. The custodian is compensated
for its services by the manager. There is no
charge to the Fund.
INDEPENDENT PUBLIC ACCOUNTANTS
The Fund's financial statements are examined
annually by independent public accountants
approved by the directors each year, and in years
in which an annual meeting is held the directors
may submit their selection of independent public
accountants to the shareholders for ratification.
Arthur Andersen LLP, P.O. Box 13406, Kansas
City, Missouri 64199, is the Fund's present
independent public accountant.
Reports to shareholders will be published at
least semiannually.
OTHER JONES & BABSON FUNDS
The Fund is one of nine no-load funds
comprising the Babson Mutual Fund Group
managed by Jones & Babson, Inc. in association
with its investment counsel, David L. Babson &
Co. Inc. The other funds are:
EQUITY FUNDS
DAVID L. BABSON GROWTH FUND,
INC. was organized in 1960 with the objective
of long-term growth of both capital and
dividend income through investment in the
common stocks of well-managed companies
which have a record of long-term above-
average growth of both earnings and
dividends.
BABSON ENTERPRISE FUND, INC. was
organized in 1983 with the objective of long-
term growth of capital by investing in a
diversified portfolio of common stocks of
smaller, faster-growing companies with market
capital of $15 million to $30 million at the
time of purchase. This Fund is intended to be
an investment vehicle for that part of an
investor s capital which can appropriately be
exposed to above-average risk in anticipation
of greater rewards. This Fund is currently
closed to new shareholders.
BABSON ENTERPRISE FUND II, INC.
was organized in 1991 with the objective of
long-term growth of capital by investing in a
diversified portfolio of common stocks of
smaller, faster-growing companies which at
the time of purchase are considered by the
Investment Adviser to be realistically valued in
the smaller company sector of the market.
This Fund is intended to be an investment
vehicle for that part of an investor s capital
which can appropriately be exposed to above-
average risk in anticipation of greater rewards.
BABSON VALUE FUND, INC. was
organized in 1984 with the objective of long-
term growth of capital and income by
investing in a diversified portfolio of common
stocks which are considered to be undervalued
in relation to earnings, dividends and/or assets.
SHADOW STOCK FUND, INC. was
organized in 1987 with the objective of long-
term growth of capital that can be exposed to
above-average risk in anticipation of greater-
than-average rewards. The Fund expects to
reach its objective by investing in small
company stocks called "Shadow Stocks",
i.e., stocks that combine the characteristics of
small stocks (as ranked by market
capitalization) and "neglected stocks"
(least held by institutions and least covered by
analysts).
BABSON-STEWART IVORY INTERNA-
TIONAL FUND, INC. was organized in 1987
with the objective of seeking a favorable total
return (from market appreciation and income)
by investing primarily in a diversified portfolio
of equity securities (common stocks and
securities convertible into common stocks) of
established companies whose primary business
is carried on outside the United States.
FIXED INCOME FUNDS
D.L. BABSON BOND TRUST was
organized in 1944, and has been managed by
Jones & Babson, Inc. since 1972, with the
objective of a high level of current income and
reasonable stability of principal. It offers two
portfolios - Portfolio L and Portfolio S.
D. L. BABSON TAX-FREE INCOME
FUND, INC. was organized in 1979 to provide
shareholders the highest level of regular
income exempt from federal income taxes
consistent with investing in quality municipal
securities. It offers three separate high-quality
portfolios (including a money market
portfolio) which vary as to average length of
maturity.
A prospectus for any of the Funds may be
obtained from Jones & Babson, Inc., Three
Crown Center, 2440 Pershing Road, Suite G-15,
Kansas City, Missouri 64108.
Jones & Babson, Inc. also sponsors and
manages six mutual funds which especially seek
to provide services to customers of affiliate banks
of UMB Financial Corporation . They are UMB
Stock Fund, Inc., UMB Bond Fund, Inc., UMB
Money Market Fund, Inc., UMB Tax-Free
Money Market Fund, Inc., UMB Heartland Fund,
Inc. and UMB WorldWide Fund, Inc.
Jones & Babson, Inc. also sponsors and
manages the Buffalo Balanced Fund, Inc.
MONEY MARKET SECURITIES
DESCRIBED AND RATINGS
In evaluating investment suitability, each
investor must relate the characteristics of a
particular investment under consideration to
personal financial circumstances and goals.
Money market instruments are generally
described as short-term debt obligations issued
by governments, corporations and financial
institutions. Usually maturities are one year or
less.
The yield from this type of instrument is very
sensitive to short-term lending conditions. Thus,
the income of the Fund will follow closely the
trend of short-term interest rates, rising when
those rates increase and declining when they fall.
Because of the short maturities, fluctuation in
the principal value of money market-type
securities resulting from changes in short-term
interest rates normally will not be sufficient to
change the net asset value (price) per share.
Although the Fund's shareholders can anticipate
that this principal value stability will be reflected
in the price of the Fund's shares, it cannot be
guaranteed.
A money market security does not have the
characteristics usually associated with a long-
term investment. Long-term investors who
commit their assets to a money market security
must understand that short-term interest rates
have a history of sharp and frequent peaks and
valleys. Thus, there may be occasions when the
rates are sufficiently low as to be unattractive
when compared to the return on other types of
investments. The investor who commits long-
term funds to a short-term investment is exposed
to the risks associated with buying and
selling securities in anticipation of unpredictable
future market events.
Description of Bond Ratings:
Standard & Poor s Corporation (S&P) . . .
AAA - Highest Grade. These securities possess
the ultimate degree of protection as to principal
and interest. Marketwise, they move with
interest rates, and hence provide the maximum
safety on all counts.
AA - High Grade. Generally, these bonds differ
from AAA issues only in a small degree. Here
too, prices move with the long-term money
market.
A - Upper-medium Grade. They have
considerable investment strength, but are not
entirely free from adverse effects of changes in
economic and trade conditions. Interest and
principal are regarded as safe. They
predominately reflect money rates in their
market behavior but, to some extent, also
economic conditions.
Moody s Investors Service, Inc. (Moody s) .
Aaa - Best Quality. These securities carry the
smallest degree of investment risk and are
generally referred to as "gilt-edge." Interest
payments are protected by a large, or by an
exceptionally stable margin, and principal is
secure. While the various protective elements
are likely to change, such changes as can be
visualized are most unlikely to impair the
fundamentally strong position of such issues.
Aa - High Quality by All Standards. They are
rated lower than the best bonds because margins
of protection may not be as large as in Aaa
securities, fluctuation of protective elements may
be of greater amplitude, or there may be other
elements present which make the long-term risks
appear somewhat greater.
A - Upper-medium Grade. Factors giving
security to principal and interest are considered
adequate, but elements may be present which
suggest a susceptibility to impairment sometime
in the future.
Description of Commercial Paper Ratings:
Moody's . . . Moody's commercial paper
rating is an opinion of the ability of an issuer to
repay punctually promissory obligations not
having an original maturity in excess of nine
months. Moody's has one rating - prime. Every
such prime rating means Moody's believes that
the commercial paper note will be redeemed as
agreed. Within this single rating category are
the following classifications:
Prime - 1 Highest Quality
Prime - 2 Higher Quality
Prime - 3 High Quality
The criteria used by Moody's for rating a
commercial paper issuer under this graded
system include, but are not limited to the
following factors:
(1) evaluation of the management of the issuer;
(2) economic evaluation of the issuer's industry
or industries and an appraisal of speculative
type risks which may be inherent in certain
areas;
(3) evaluation of the issuer's products in
relation to competition and customer
acceptance;
(4) liquidity;
(5) amount and quality of long-term debt;
(6) trend of earnings over a period of ten years;
(7) financial strength of a parent company and
relationships which exist with the issuer;
and
(8) recognition by the management of
obligations which may be present or may
arise as a result of public interest questions
and preparations to meet such obligations.
S&P . . . Standard & Poor's commercial paper
rating is a current assessment of the likelihood of
timely repayment of debt having an original
maturity of no more than 270 days.
Ratings are graded into four categories, ranging
from "A" for the highest quality obligations
to "D" for the lowest. The four categories
are as follows:
A Issues assigned this highest rating are
regarded as having the greatest capacity
for timely payment. Issues in this
category are further refined with the
designations 1, 2, and 3 to indicate the
relative degree of safety.
A-1 This designation indicates that
the degree of safety regarding
timely payment is very strong.
A-2 Capacity for timely payment on
issues with this designation is
strong. However, the relative
degree of safety is not as
overwhelming.
A-3 Issues carrying this designation
have a satisfactory capacity for
timely payment. They are,
however, somewhat more
vulnerable to the adverse effects
of changes in circumstances than
obligations carrying the higher
designations.
B Issues rated "B" are regarded as
having only an adequate capacity for
timely payment. Furthermore, such
capacity may be damaged by changing
conditions or short-term adversities.
C This rating is assigned to short-term
debt obligations with a doubtful capacity
for payment.
D This rating indicates that the issuer is
either in default or is expected to be in
default upon maturity.
FINANCIAL STATEMENTS
(To be supplied by further amendment)
PART C
OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS.
Herewith are all financial statements and exhibits filed as
a part of this registration statement:
(a) Financial Statements:
(To be supplied by further amendment)
(b) *(1) Registrant s Articles of Incorporation.
*(2) Registrant s Bylaws.
(3) Not applicable, because there is no voting
trust agreement.
*(4) Specimen copy of each security to be issued by
the registrant.
*(5) (a) Form of Management Agreement between
Jones & Babson, Inc. and the Registrant.
(b) Form of Investment Counsel Agreement
between Jones & Babson, Inc. and Babson-
Stewart Ivory International.
*(6) Form of principal Underwriting Agreement
between Jones & Babson, Inc. and the
Registrant.
(7) Not applicable, because there are no pension,
bonus or other agreements for the benefit of
directors and officers.
*(8) Form of Custodian Agreement between Registrant
and United Missouri Bank of Kansas City, N. A.
(9) There are no other material contracts not made
in the ordinary course of business between the
Registrant and others.
(10) Opinion and consent of counsel as to the
legality of the registrant s securities being
registered. (To be supplied annually pursuant
to Rule 24f-2 of the Investment Company Act of
1940.)
(11) The consent of Arthur Andersen & Co.,
Independent Public Accountants.
(To be supplied by further amendment)
(12) Not applicable.
*(13) Letter from contributors of initial capital to
the Registrant that purchase was made for
investment purposes without any present
intention of redeeming or selling.
*(14) Copies of the model plan used in the establishment
of any retirement plan in conjunction with which
Registrant offers its securities.
(15) Not applicable.
*(16) Schedule for computation of performance
quotations.
*(17) Copies of Powers of Attorney pursuant to Rule
402(c).
*Previously filed and incorporated herein by reference.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL OF THE
REGISTRANT.
NONE
Item 26. NUMBER OF HOLDERS OF SECURITIES.
The number of record holders of each class of securities of
the Registrant as of July 31, 1995, is as follows:
(1) (2)
Title of class Number of Record Holders
Common Stock $0.01 par value 604
Federal Portfolio
Common Stock $0.01 par value 2,606
Prime Portfolio
Item 27. INDEMNIFICATION.
Under the terms of the Maryland General Corporation Law and
the company s By-laws, the company shall indemnify any
person who was or is a director, officer, or employee of the
company to the maximum extent permitted by the Maryland
General Corporation Law; provided however, that any such
indemnification (unless ordered by a court) shall be made by
the company only as authorized in the specific case upon a
determination that indemnification of such persons is proper
in the circumstances. Such determination shall be made
(i) by the Board of Directors by a majority vote of a
quorum which consists of the directors who are neither
interested persons of the company as defined in
Section 2(a)(19) of the 1940 Act, nor parties to the
proceedings, or
(ii) if the required quorum is not obtainable or if a quorum
of such directors so directs, by independent legal
counsel in a written opinion.
No indemnification will be provided by the company to any
director or officer of the company for any liability to the
company or shareholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of duty.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR.
The principal business of Jones & Babson, Inc. is the
management of the Babson family of mutual funds. It also
has expertise in the tax and pension plan field. It
supervises a number of prototype and profit-sharing plan
programs sponsored by various organizations eligible to be
prototype plan sponsors.
The principal business of David L. Babson & Co., Inc. is to
provide investment counsel and advice to a wide variety of
clients. It supervises assets in excess of $3,000,000,000.
Item 29. PRINCIPAL UNDERWRITERS.
(a) Jones & Babson, Inc., the only principal underwriter of
the Registrant, also acts as principal underwriter for
the David L. Babson Growth Fund, Inc., Babson
Enterprise Fund, Inc., Babson Value Fund, Inc., D.L.
Babson Tax-Free Income Fund, Inc., D.L. Babson Bond
Trust, Shadow Stock Fund, Inc., Babson-Stewart Ivory
International Fund, Inc., UMB Stock Fund, Inc., UMB
Bond Fund, Inc., UMB Money Market Fund, Inc., UMB
Tax-Free Money Market Fund, Inc. and UMB Qualified
Dividend Fund, Inc.
(b) Herewith is the information required by the following
table with respect to each director, officer or partner
of the only underwriter named in answer to Item 21 of
Part B:
Name and Principal Position and Offices Positions and Offices
_Business Address_ __with Underwriter__ ___with Registrant___
Stephen S. Soden Chairman and Director None
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
Larry D. Armel President and Director President and
Three Crown Center Director
2440 Pershing Road
Kansas City, MO 64108
Giorgio Balzer Director None
3
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
J. William Sayler Director None
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
Edward S. Ritter Director None
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
Robert N. Sawyer Director None
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
Vernon W. Voorhees Director None
BMA Tower
One Penn Valley Park
Kansas City, MO 64141
P. Bradley Adams Vice President Vice President
Three Crown Center and Treasurer and Treasurer
2440 Pershing Road, G-15
Kanasas City, Missouri 64108
Michael A Brummel Vice President Vice President
Three Crown Center
2440 Pershing Road, G-15
Kanasas City, Missouri 64108
Ruth Evans Vice President Vice President
Three Crown Center
2440 Pershing Road, G-15
Kanasas City, Missouri 64108
Martin A. Cramer Vice President Vice President
Three Crown Center and Secretary and Secretary
2440 Pershing Road, G-15
Kanasas City, Missouri 64108
(c) The principal underwriter does not receive any
remuneration or compansation for the duties or services
rendered to the Registrant pursuant to the principal
underwriting Agreement.
Item 30. LOCATION OF ACCOUNTS AND RECORDS.
Each account, book or other document required to be
maintained by Section 31(a) of the 1940 Act and the Rules
(17 CFR 270.31a-1 to 31a-3) promulgated thereunder is in the
physical possession of Jones & Babson, Inc., at Three Crown
Center, 2440 Pershing Road, G-15, Kansas City, Missouri
64108.
Item 31. MANAGEMENT SERVICES.
All management services are covered in the management
agreement between the Registrant and Jones & Babson, Inc.,
which are discussed in Parts A and B.
Item 32. DISTRIBUTION EXPENSES.
Not applicable.
Item 33. UNDERTAKINGS.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940, the Registrant has duly caused
this amendment to its registration statement to be signed on its
behalf by the undersigned, thereunto authorized, in the City of
Kansas City, and State of Missouri on the 11th day of August, 1995.
D. L. BABSON MONEY MARKET FUND, INC.
(Registrant)
By Larry D. Armel, President
(Larry D. Armel, President)
Pursuant to the requirements of the Securities Act of 1933,
this Post-effective Amendment #21 to the Registration Statement
has been signed below by the following persons in the capacities
and on the date indicated.
Larry D. Armel President, Principal August 11, 1995
Larry D. Armel Executive Officer,
and Director
H. David Rybolt Director August 11, 1995
H. David Rybolt*
William H. Russell Director August 11, 1995
William H. Russell*
Francis C. Rood Director August 11, 1995
Francis C. Rood*
P. Bradley Adams Treasurer and Principal August 11, 1995
P. Bradley Adams Financial and Accounting
Officer
*Signed pursuant to Power of Attorney
By Larry D. Armel
Attorney-in Fact
