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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A File #2-74436
File 811-3287
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ( )
Pre-Effective Amendment No. _____ ( )
Post-Effective Amendment No. 18th (x)
------
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 ( )
Post-Effective Amendment No.18th (x)
(Check appropriate box or boxes)
NEW ALTERNATIVES FUND, INC.
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(Exact Name of Registrant as Specified in Charter)
150 Broadhollow Road, Melville, New York 11747
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(Address of Principal Executive Offices) (Zip Code)
(516) 423-7373
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*(Registrant's Telephone Number, including Area Code)
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: See Below
---------------
It is proposed that this filing will become effective
immediately upon filing pursuant to paragraph (b)
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on pursuant to paragraph (b)
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60 days after filing pursuant to paragraph (a)
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X on April 30, 1999 pursuant to paragraph (a) of rule (485)
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(Check Appropriate Box)
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NEW ALTERNATIVES FUND, INC.
PROSPECTUS CROSS REFERENCE SHEET
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<CAPTION>
< NUMBER FROM CAPTIONS IN PROSPECTUS Prospectus Page
FORM N-1A
<S> <C> <C>
(Part "A")
(Part "A" Prospectus)
1.Front and Back Page Front 10
back 12
(Table of Contents) Table of Contents 2
2.Risk/Return Summary: Investments, Fund Investments, Goals, 3
Risks and Performance Policy and Strategy 3
Special Interest-Alternative Energy 3
Main Risks of Investing in The Fund 3
Is This Fund For You 4
Average Annual Returns 4
(Bar Chart and Tables) 4
3. Risk/Return
Summary Fees and Expenses 5
Maximum Sales Charge 5
Operating Expenses 5
Effect of Operating Expenses 5
4. Investment Objectives, Principal Investment Objectives 5
Investment Strategies, and Related and Strategy
Risks Funds Awaiting Investment 5
Investment Formula 5
Alternative Energy Illustrations 6
Fund Definition of Alternative Energy 6
Products Relating to Fund Area of 6
Interest
Problems and Advantages in Area 6,7
of Investment
5. Management's Discussion of Fund N/A
Performance
6. Management, Organization Management, Investment Advisor 7,8
and Capital Structure and Portfolio Advisor
7. Shareholder Information Pricing of Fund Shares 8
Purchasing Shares 9
(under "How to Purchase Shares")
Minimum Investment, Minimum 8
General Restrictions 8
Subsequent Investment 8
Transfer of Shares 8
Redemption of Shares 8
Signatures 8
8. Distribution Arrangements How to Purchase Shares 9
Price Table 9
Reduction of Charges 9
Sales Charge Exemptions 9,10
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Year 2000 Year 2000 10
9.Financial Information Financial Highlights 10
<
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----------------------------
Logo Here
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PROSPECTUS
DATED APRIL 30TH 1999
NEW ALTERNATIVES FUND, INC.
150 Broadhollow Road, Melville, N.Y., 11747
Telephone 1 800 423 8383 or 1 516 423 7373
New Alternatives Fund, Inc. is a mutual fund seeking growth investment
in various industries that are oriented to a clean environment
with a SPECIAL interest in Alternative Energy
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved of this Fund's shares or determined whether this
prospectus is accurate or complete. Anyone who tells you otherwise is committing
a crime.
PRINTED ON RECYCLED PAPER
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TABLE OF CONTENTS
SUBJECT PAGE
Fund Investments, Goals, Policy and Strategy 3
Special Interest - Alternative Energy 3
Main Risks of Investing the Fund 3
Is This Fund for you? 3
Average Annual Returns Bar Chart and Tables 4
Fees and Expenses 5
Maximum Sales Charge 5
Operating Expenses 5
Effect of Operating Expenses 5
Investment Objectives and Strategy 5
Funds Awaiting Investment 5
Investment Formula 5
Alternative Energy Illustrations 5,6
Fund Definition of Alternative Energy 6
Products Related to Areas of Fund Interest 6
Problems and Advantages in Areas of Investment 6,7
Management, Investment Advisor and Portfolio Manager 7,8
Pricing of Fund Shares 8
Minimum Investment, Minimum Subsequent Investment 8
General Restrictions 8
Transfer of Shares 8
Redemption Shares 8
Signature Requirements 8
Dividends and Distributions 9
Tax Consequences 9
How to Purchase Shares 9
Price Table 9
Reduction of Charges 9
Sales Charge Exemptions 9
Year 2000 10
Financial Highlights 10
Fund Application Form 11
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FUND'S INVESTMENT OBJECTIVES STRATEGIES AND GOALS
Similar to many funds, the Fund seeks long term capital gains by investing in
common stocks. Investments are in a wide range of industries and in companies of
all sizes.
New Alternatives Fund investment policies are also materially different from
other funds.
A: Most of this Fund=s investments will be in companies that provide a
contribution to a clean and sustainable environment.
B: There is a special interest in alternative energy
C: Companies with non-discriminatory practices at all levels of their work force
and general social responsibility are preferred..
SPECIAL INTEREST ----------------> ALTERNATIVE ENERGY
The Fund's goal is to invest 25% or more of assets in companies involved in
alternative energy. That percentage may not always be achieved. There are
presently a limited number of companies from which to choose.
MAIN RISKS OF INVESTING IN THE FUND
All mutual funds have a level of risk that comes from changes in the market and
changes in the economy. Fund shares will fluctuate in value. Losses are
possible.
New technologies may be feasible, but not cost effective. The Fund may not
choose among them wisely.
Interest in achieving a clean environment may diminish.
Investments in Alternative Energy and companies with environmental products are
subject to political priorities and changing government regulation.
Potential advantages of alternative energy may be slow in development and
recognition.
There are risks from a failure to enforce environmental law, reduced prices for
recycled products, energy prices and commodities such as natural gas.
Part of the fund portfolio will include small developing companies where risks
are normally higher.
Foreign investment maximum is 15%. Such investments are limited to foreign
companies that are regularly traded in the United States and which publish
information in English at levels similar to US companies.
Foreign investment has risks arising from currency fluctuation, tax and
political changes.
This disclosure of risks is not complete. There are risks which cannot yet be
envisioned.
IS THIS FUND FOR YOU? This Fund's shares are not for investors seeking a
high level of current income or safety. Investing in this Fund is not a
complete
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investment program.
This Fund may appeal to investors with an interest in alternative energy,
environmental improvement and social responsibility. Please understand that
social responsibility is a subjective concept that is interpreted by the
managers.
This policy reduces the number of companies from which choices can be made.
AVERAGE ANNUAL RETURNS
Total Return measures the price change in a fund share. The computations assume
the reinvestment of all dividends and capital gain distributions. The
information provides some indication of the risks of investing in the fund. Past
performance does not necessarily indicate future performance. The bar chart does
not reflect sales charges. If those items were included, the returns would be
less than those shown in the chart.
[THE NARRATIVE AND/OR TABULAR INFORMATION BELOW IS A FAIR AND ACCURATE
DESCRIPTION OF GRAPHIC OR IMAGE MATERIAL OMITTED FOR THE
PURPOSE OF EDGAR FILING.]
PERFORMANCE BAR CHART FOR NEW ALTERNATIVES FUND, INC.
Year (*fiscal
year ended on Percent Change
4/30 until 1987) for Calendar Year (%)
1982 10.4%
1983 13.5%
1984 -0.5%
1985 23.3%
1986 22.2%
1987 - 2.6%
1988 23.9%
1989 26.0%
1990 - 7.6%
1991 25.6%
1992 4.9%
1993 2.9%
1994 - 3.7%
1995 19.5%
1996 13.3%
1997 11.1%
1998 -10%
The fund's high and lowest quarterly results during this time period were:
Highest quarter Lowest quarter
Date: June 30, '89 Sept. 30, '98
Percent 17.47 -17.81
- ----------------------------------------------------
1998 Five Ten Life of the
Years Years Fund
New Alternatives Fund
-14.75 2.4% 7.5% 9.6%
Russell 2000 Index*
- - 2.55% 11.86% 12.92% 13.89%
S&P 500 Index
287% 24.1% 19.2% 19.1%
*SEE NOTES
- ----------------------------------------------------
*NOTES
*NOTE 1: The Russell 2000 Index consists of
the small US stocks It is a widely recognized
index. Previously the Fund used the S&P500 for comparison.
*NOTE 2: Because the stocks that the Fund invests with, are rarely part of the
S&P 500, the Fund has added the Russell 2000 index and intends to drop the S&P
500.
*NOTE 3: There is no other fund, to the manager's knowledge, with a
special interest in alternative
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energy. This makes difficulty in finding an index that is quite comparable.
*NOTE 4: Fund results were calculated according to a standard formula. The
formula requires that the maximum sales charge of 4.75% be deducted. Results
would be higher if they were calculated at net asset value. The indices
represent stocks. The indices are unmanaged and do not reflect sales charges,
commissions or expenses.
FEES AND EXPENSES:
This summary (to the right) shows what it will cost you directly or
indirectly to invest in the Fund. These are transaction expenses- fees you
pay directly.
MAXIMUM SALES CHARGE (load),
as a percentage of offering price. 4.75%*
Maximum Deferred Sales Charge None
Maximum Sales Charge on
Reinvested Dividends None
Redemption Fee None
Total 4.75%
FUND OPERATING EXPENSES
This table (below) is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds.
Management Fees .78%
Distribution (12b-1) NONE
*Other Expenses .40
------
Total 1.18%
*Other Expenses include Fund operating expenses such as: custodian and transfer
agent expenses.
EFFECT OF OPERATING EXPENSES
This example (below) is also intended to help you compare the cost of
investing in the Fund with the cost of investing in other mutual funds. The
example assumes that you invest $10,000.00 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those periods.
The Example also assumes the maximum sales load and that your investment
has a 5% return each year and the Fund's operating expenses remain the
same. Your costs might be higher or lower, based on these assumptions your
costs would be as indicated.
1 Year 3 Years 5 Years 10 Years
$587.00 $828.70 $1067.70 $1748.90
INVESTMENT OBJECTIVES AND STRATEGY
Money awaiting investment in stocks are generally kept in US Treasury
Bills. The Fund maintains modest amounts in socially concerned (federally
insured) banks that are committed to serving community needs.
INVESTMENT FORMULA: There is no commitment to any formula in selecting
investments, such as favoring growth or value or any technical system.
ALTERNATIVE ENERGY: THE AREA OF SPECIAL INTEREST , alternative energy and
related products, is illustrated below:
* a. solar cells produce electricity from sunlight,
* b. fuel cells produce electricity from hydrogen, which has been
separated from hydrocarbons.
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* c. Hydroelectric power is clean, but its uses are limited.
* d. geothermal energy is produced by heat produced from sources
below the earth's surface.
* e. conservation includes insulation, energy efficient electrical
equipment, and transportation such as electric vehicles, bicycles and
railroads.
* f. recycling is a form of energy and resource conservation.
* g. cogeneration uses a single fuel to produce simultaneously,
general use electricity and heat or cooling.
RELATED PRODUCTS IN WHICH WE INVEST are illustrated below:
BATTERIES FOR SOLAR ENERGY Solar cells depend on daylight to produce
energy. Batteries are needed to store the energy. In some case's inverters
are needed to convert direct current to alternating current.
NATURAL GAS is the cleanest of hydrocarbon conventional fuels. It is also
the most promising current source of hydrogen for fuel cells.
RESOURCE CONSERVATION: Renewable biomass fuel saves resources. Lumber made
from laminating cheap or waste wood or fast-growing trees is stronger than
regular timber. It will help preserve hard wood forests. Paper made from
fast-growing plants saves forests.
THE DEFINITION OF ALTERNATIVE ENERGY Atomic energy is not included as an
area for alternative energy investment. There is a significant potential
for accident, unresolved radioactive waste disposal problems, excessive
cost and frequent community opposition. There is increasing distress with
the cost of dismantling atomic energy plants as they mature or depreciate.
Presently the Fund does not include oil and coal resources within its
definition of solar and alternative energy. Nevertheless, the Fund may
invest in such companies when they are actively developing or producing
such items as photovoltaics, fuel cells or developing other products and
technologies related to the Fund areas of interest. There may be future
technologies for the transformation of coal to a clean source of energy.
ILLUSTRATION OF PROBLEMS AND ADVANTAGES IN DIFFERENT AREAS OF INVESTMENT:
RECYCLING: When steel from the Far East pours into the U.S., the price of
recycled metals and the companies that collect and process metal falls.
When raw material price for plastic production becomes inexpensive, the
demand for recycled plastic declines. As a decline in resource availability
becomes visible, prices rise.
CONVENTIONAL ENERGY PRICES can fluctuate widely. Oil supplies are finite.
Alternative energy technologies advance and become less expensive. Change
can be expected for the prospects for alternative energy. There are
variable levels of public anxiety about national energy independence. There
are polluting effects from oil and coal as currently used. Attitudes toward
alternative energy change with the supply and price of energy.
CLEAN AIR AND CLEAN WATER investment grows when there are water-based
epidemics, acid rain, polluted streams, reports of asthma and allergies. It
falters when federal,
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state and local commitment fades. There is a continuing contest between
opposition to government regulation and clean air and water.
SOLAR (PHOTOVOLTAIC) CELLS are presently exciting in remote areas where
there is no utility grid. The costs are getting lower and the cells more
powerful each year. They are not presently competitive with utility
electric production.
FUEL CELLS appear to be more efficient than conventional utility produced
electricity and cleaner. The main by-product is drinkable water. Commercial
use is barely beginning. They are not yet proved to be cost efficient.
Choosing the best cells and the companies that produce them may prove
difficult.
ENVIRONMENTALLY GROWN AND PROCESSED FOODS are enjoying a period of growth.
Producers, distributors and retailers are prospering. Many of the products
cost more. The growth may not survive a poor economy.
MORE ALTERNATIVES: The list of energy alternatives and environmental
solutions cannot be exhaustive or the comments complete.
Technologies such as OTEC, using ocean thermal variation or wave action
from the ocean to produce electricity are under development.
There will be other new opportunities in new areas of alternative energy
and new environmental products and technologies. The Fund will include them
as they appear practical.
THE INVESTMENT MANAGER AND ADVISOR of the Fund is Accrued Equities, Inc. of
150 Broadhollow Rd. Melville, NY 11747. The company was founded in 1954 to
advise the personal investment clients of then practicing lawyer Maurice
Schoenwald.
The officers of the advisor are Maurice and David Schoenwald (father and
son), who founded the Fund in 1982.The manager makes all investment
decisions, provides office space, staff, telephone administrative services,
secretarial services, government regulatory compliance, information,
preparation of documents and like services.
The management fee is 1% of the first $10 million of assets; .75 of 1% for
the next $20 million; .50of 1% for assets more than $30million and .45 of
1% for assets more than $100 million. This amounted to .78% of net assets in
1998.
PORTFOLIO MANAGERS: The managers are Maurice and David Schoenwald. They
were local, private practicing attorneys, personally interested in social
and environmental matters. They have managed the Fund since its inception.
David has been a journalist and an attorney with Law Services (a poverty
law agency).
Maurice has had experience teaching law, practicing commercial law,
arranging various investments and writing about investment. They are the
only portfolio managers of a current mutual fund with a special interest in
7
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alternative energy.
They received financial and consultive assistance in founding the Fund from
friends and neighbors. Since founding the Fund, they have sought and
received advice from shareholders. Such help and commentary are solicited
during each quarter.
The portfolio managers are attentive to and influenced by shareholder
commentary.
PRICING SHARES: Shares are priced once at the end of each business day on
which the New York Stock Exchange is open for trading. That is usually at
4:00PM Eastern time. Your order will be priced at the Fund value per share,
called NAV, when your order is accepted by the transfer agent.
MINIMUM INVESTMENT : The minimum Initial investment in the Fund is
$2,500.00, or $2,000.00 for retirement plans such as IRA's or similar
plans.
MINIMUM SUBSEQUENT INVESTMENT:
After the minimum initial investment you can add as little as $50.00 at any
time through an automatic investment arrangement with your bank. If you do
not use the automatic system, the minimum additional investment is $250.00.
GENERAL RESTRICTIONS: If your account falls below $1,000.00 the Fund
reserves the right to return to you the current value of your account. The
Fund will usually request that you increase your balance before closing
your account.
The Fund reserves the right to refuse certain requests to purchase.
TRANSFER OF SHARES: You may, without charge, transfer shares to, co-owners,
children, parents, siblings, spouse, family trusts, grandchildren,
grandparents and estates. Other transfers are not authorized. You can
always redeem shares (sell shares back to the Fund) for their then current
value.
REDEEMING SHARES: You may redeem shares at any time. The pricing will be at
the next net asset value per share calculated after the transfer agent
receives your written request.
If the Fund has not collected payment for your purchase of the shares, they
will delay payment for your redemption until payment for the shares is
collected. Shares for which no payment is collected will be canceled
without notice.
SIGNATURES : The following helps protect the fund and its shareholders
against fraud. Requests for redemption must be in writing signed by the
person or persons named in the account and addressed to New Alternatives
Fund, Inc. C/O First Data Investor Service, 211Gulph Road, King of Prussia,
Pennsylvania, 19406.
Signature guarantees are required. They can be provided by any of the
following: a bank, registered stock broker on the New York Stock Exchange
or savings and loan association.
If the amount redeemed is less than $2,500.00, the need for a guarantee may
be waived if the proceeds go to the Fund owners at their last filed
address.
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DIVIDENDS AND DISTRIBUTIONS: Once a year the Fund pays its shareholders
dividends from net investment income received and distributes any net
capital gains that it has realized. Your distributions will be reinvested
in the Fund unless you instruct otherwise.
TAXES: The Fund expects to make distributions that will be taxed as
ordinary income or capital gains. Fund dividends and distributions are
taxable to most investors unless your investment is in an IRA or other
tax-advantaged account. The dividends and distributions are taxed whether
paid or re-invested. IRA accounts and like account holders pay taxes when
you receive benefits.
The tax status of your dividends and gains distributions will be detailed
in your annual tax statement from the Fund.
HOW TO PURCHASE SHARES: On the last page, before the cover, is an order
form. Should you wish to open an IRA account or some other special account,
please call the Fund and you will receive the forms. The order should be
sent to our transfer agent addressed to New Alternatives Fund, Inc. C/O
First Data Investor Services Group, 211Gulph Road, King of Prussia,
Pennsylvania, 19406
MORE INFORMATION: You can reach the Fund by phone at 1-800 423 8383. We can
supply general information, detail about Fund policy, annual reports,
statements of additional information and prospectuses.
The transfer agent can tell the shareholders about the status of their
accounts and provide specialized forms for IRA's and transfers from brokers
or other funds. The transfer agent can be reached at 610 239 4600
REDUCTIONS OR MODIFICATIONS IN CHARGES ARE AVAILABLE:
1.Subsequent Additional Purchases: If you add to your holdings and pass the
threshold into larger category, the sales charge for the additional
purchases will be at the reduced rate of the newly obtained category.
2.Purchases Made by Families: Investors may combine family purchases into a
single transaction to qualify for a reduced sales charge. This includes
purchases by spouses, children, parents, siblings, grandparents and family
trusts.
It is each investor's responsibility to notify the transfer agent at the
time of purchase of eligibility for such reduced sales charge. Attach a
note to your order or call before making the order to assure your reduced
arrangement
SALES CHARGE EXEMPTIONS: People or institutions who may invest in the Fund
without paying sales charges are:
A. Non Profit or Charitable Organizations (as defined in Section 501 (c)
(3) of the Internal Revenue Code) investing $50,000. or more.
B. Clients of an Investment Advisor in the U.S. while the client is charged
an ongoing fee by the investment advisor for advisory services
C. Brokers who are purchasing for their own account who will not transfer
their shares.
D. Officers and employees of the Fund and manager and their families.
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Persons using the above privileges are obliged to note the facts on their
order form. Calling the Fund office in advance can help prevent errors.
YEAR 2000 is a concern because it is suggested that there will be computer
errors for some computers at that time. Such errors could affect fund
records. All fund books and records are maintained by First Data Investor
Services Group, our transfer agent. They serve many mutual funds including
large funds. The Fund has made inquiries of our transfer agent and they
have provided reports, all of which indicate that they are taking steps to
meet the problem. Should the service provider fail to do what is required
this could cause inconvenience and losses.
FINANCIAL HIGHLIGHTS: This table describes the Fund's performance for the
periods indicated."Total Return" shows how much your investment in the fund
would have increased or (decreased) during each period. It assumes you
reinvested all dividends and distributions. These figures have been
independently audited by Kenneth Katz, CPA whose report along with the
Fund's financial statement is included in the annual report.
PER SHARE DATA STATEMENT OF PER SHARE INCOME AND CAPITAL
CHANGES
For each share of capital stock outstanding*
<TABLE>
<CAPTION>
Year Year Year Year Year Year Year Year Year
End End End End End End End End End
12/31 12/31 12/31 12/31 12/31 12/31 12/31 12/31 12/31
1998 1997 1996 1995 1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE AT
BEGINNING $32.07 $30.87 $30.51 $28.14 $30.0 $29.95 $29.19 $24.62 $27.57
OF PERIOD ------ ------ ------ ------ ----- ------ ------ ------ ------
Investment Income $.52 $.64 $.73 $.75 $.72 $.62 $.62 $.72 $.70
Net Investment Income .15 .26 .34 .35 .32 .29 .34 .43 .43
Net realized &
Unrealized gain (Loss) (3.07) 3.16 3.72 5.14 (1.43) .58 1.10 5.86 (2.53)
on investment ----- ---- ---- ---- ----- --- ---- ---- -----
Total from Investment (3.22) 3.42 4.06 5.49 (1.11) .87 1.44 6.29 (2.10)
operations
Dividends from net (.15) (.26) (.34) (.35) (.32) (.29) (.34) (.43) (.43)
investment income
Distributions from net
realized gain (.16) (1.96) (3.36) (2.77) (.43) (.53) (.34) (1.29) (.42)
---- ----- ----- ----- ---- ---- ---- ----- ----
Total Distributions (.31) (2.22) (3.70) (3.12) (.75) (.82) (.68) (1.72) (.85)
Net asset value as of
end of the period $28.54 32.07 30.87 30.51 28.14 30.00 29.95 29.19 24.62
------ ----- ----- ----- ----- ----- ----- ----- -----
Total return
(Sales load not (10%) 11.1% 13.3% 19.5% (3.7)% 2.9% 4.9% 25.6% (7.6)%
reflected)
Net assets, end of $33,021 $37,941 $35,549 $32,236 $28,368 $31,567 $28,89 $23,93 $16,43
period 6 1 3
Ratio of operating
expense to net assets** 1.18% 1.15% 1.21% 1.28% 1.30% 1.11% 1.04% 1.18% 1.27%
Ratio of net investment
income to average net .49% .79% 1.04% 1.12% 1.04% .96% 1.25% 1.74% 2.08%
assets**
Portfolio turnover 32.4% 53.9% 51.2% 48.72% 33.00% 18.36% 13.10 21.50 24.70
Number of shares 1,156,952 1,111,377 1,038,561 965,769 984,847 1,026,460 945,00 776,97 646,66
outstanding at end of 6 4 4
period***
<CAPTION>
Year Year Year Year First
End End End End Seven
12/31 12/31 12/31 4/30 Months
1989 1988 1987 1987 4/30/83
**** ****
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE AT
BEGINNING $22.55 $18.85 $22.43 $19.68 $12.50
OF PERIOD ------ ------ ------ ------ ------
Investment Income $.73 $.67 $.40 $.38 $.38
Net Investment Income .47 .42 .24 .22 .18
Net realized &
Unrealized gain (Loss) 5.41 4.09 (3.21) 3.45 3.08
on investment ---- ---- ----- ---- ----
Total from Investment 5.88 4.51 (2.97) 3.67 3.26
operations
Dividends from net
investment income (.47) (.42) (.24) (.22) (.18)
Distributions from net
realized gain (.39) (.39) (.38) (.70) (.19)
---- ---- ---- ---- ----
Total Distributions (.86) (.81) (.62) (.92) (.37)
Net asset value as of
end 27.57 22.55 18.85 22.43 15.39
of the period ----- ----- ----- ----- -----
Total return
(Sales load not 26.0% 23.9% (2.6)% 22.2% 10.4%
reflected)
Net assets, end of $11,89 $6,162 $4,133 $3,404 $163
period 3
Ratio of operating
expense to net asset 1.25% 1.24% .80% 1.17% 1.08%
Ratio of net investment
income to average net 2.20% 2.18% 1.23% 1.68% 1.69%
assets**
Portfolio turnover 14.60 25.88 8.57% 8.79% 74.50%
Number of shares 1 419,21 264,41 212,704 151,848 10,592
outstanding at end of 2 4
period***
</TABLE>
* All adjusted for two for one share split on July 26, 1985 and January
2, 1990
** Annualized and includes state taxes
*** Shares immediately prior to dividend - Fund commenced operation on
September 3, 1982
**** At this time the fund was on a fiscal year. Table for 1983-1987 is
available on request. Deleted to make space.
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APPLICATION FOR PURCHASE OF SHARES
<TABLE>
<CAPTION>
<S> <C>
New Alternatives Fund, Inc. Phone (800) 423-8383 for General Inquiries
c/o First Data Investor Services Group Phone(610) 239-4600 for Account Status
P.O. Box 61503
211 S. Gulph Road
King of Prussia, PA 19406
</TABLE>
I hereby remit $_______________________ ($2,500.00 minimum or $2,000 for an
"IRA") to be applied toward the purchase of shares and fractions thereof of New
Alternatives Fund, Inc.
Please register the shares as follows:
(PLEASE PRINT OR TYPE CLEARLY)
Your Phone #__________________________Alternative Phone#_______________________
area code telephone area code telephone
1. ACCOUNT REGISTRATION (CHECK ONE)
{ } Individual__________________________________________________________________
first name middle initial last name
{ } Joint Tenant________________________________________________________________
first name middle initial last name
{ } Gifts to Minors---------------_under the-------- Uniform Gifts to Minors Act
Name of custodian Name of State
as custodian for________________________________________________________________
{ } Other_______________________________________________________________________
Indicate name of corporation, other organization of fiduciary capacity; if
trustee, include date of trust instrument.
2. Mailing Address______________________________________________________________
street City
_____________________________________________________________________________
State Zip
3. Social Security (or Identification) Number__________________________________.
(Use Social Security Number of minor or custodian for minor account.)
I have received a copy of the Fund's Prospectus dated April 30, 1999. I
understand that dividends and distributions will be reinvested in additional
shares unless payment in cash is requested in writing. I certify and affirm,
under penalty of perjury, the above tax number is correct. I am over the age
of eighteen.
X _____________________________________________________________________________
Signature of Applicant Signature of Joint Owner/Date
Mail this form, when completed, to New Alternatives Fund, Inc., to First Data
Investor Services Group, P.O. Box 61053, King of Prussia, PA 19406, together
with a check payable to the order of New Alternatives Fund, Inc., drawn in US
currency on a bank in the United States.
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To Be Completed By Broker - If Any
-----------------------------------------------------------------------
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BACK PAGE
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More Information is available:
A. There is a Statement of Additional Information, referred to as SAI. This
provides details of Fund organization, rules, officers, history, limitations on
types of investment, policies, government. The SAI is considered part of the
prospectus.
B. Annual and Semi-Annual Reports to Shareholders contain a discussion of the
market conditions and strategy that significantly affected the Fund's
performance during its last fiscal year. It also lists portfolio holdings at
the end of the year.
To obtain all or any of this information or other information about the Fund
without charge contact:
By telephone: Call 1-800-423-8383
By mail: New Alternatives Fund, Inc. 150 Broadhollow Road Suite 306, Mellville,
NY, 11747
On the Internet: Text-only versions of Fund documents can be viewed online or
downloaded from: SEC - - http://www.sec.gov
------------------
At the SEC You can also obtain copies by visiting the SEC's Public Reference
Room in Washington, DC. (Phone 1-800-SEC-0330) or by sending your request and a
duplicating fee to the SEC's Public Reference Section, Washington, DC
20549-6009.
The Fund SEC file number is : 811 - 3278
PRINTED ON RECYCLED PAPER
12
<PAGE>
Item 10 File 811 3287
Part B
New Alternatives Fund, Inc.
Statement of Additional Information
April 30, 1999
New Alternatives Fund, Inc. File 2 74436
150 Broadhollow Road, Suite 306
Melville, NY 11747
(516) 423-7373
(800) 423-8383
This Statement of Additional Information is not a prospectus and should be
read in conjunction with the prospectus of New Alternatives Fund, Inc.,
dated April 30 1999. The Fund's most recent Annual and Semi-Annual
Financial Reports are separate documents and are incorporated by reference
to this statement of Additional Information. Requests for copies of the
prospectus and Financial reports should be made by either calling the
above listed number, or by writing to the Fund.
TABLE OF CONTENTS
Statement of Additional Information
Page Cross Reference
to prospectus
History of the Fund B-2
Description of the Fund and its Investments and Risks B-2
Management of the Fund B-4
Control Persons and Principal Holders of Securities B-6
Investment Advisor and Other Services B-7
Brokerage, Allocation and Other Practices B-10
Description of Shares B-10
Purchase, Redemption and Pricing of Shares B-11
Taxation of the Fund B-12
Underwriters B-13
Investment Results and Related Statistics B-13
Financial Statement B-14
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<PAGE>
Item 11
History of the Fund
The Certificate of Incorporation of the Fund was filed in New York, on January
17, 1978. The Fund was an inactive corporation until it commenced its
activities as a mutual fund on September 3, 1982. The original name of the
corporation, The Solar Fund, Inc. was changed to its present name on August 6,
1982.
Item 12
Description of the Fund and its Investments and risks
Classification
a) New Alternatives Fund, Inc. is an open-end management investment company
known as a mutual fund. The Fund is diversified, which means that, with
respect to 75% of its total assets, theFund will not invest more than 5% of
its assets in the securities of any single issuer.
b) The Fund seeks long-term growth by investing in common stocks, and has a
particular interest in stocks of companies in various industries oriented
to a clean energy and the environment.
The Fund will invest in equity securities. Equity securities represent an
ownership position in a company. The prices of equity securities fluctuate
based on changes in the financial condition of their issuers and on market
and economic conditions.
The Fund may invest in stocks of smaller companies. Investing in smaller
capitalization stocks can involve greater risk than is customarily
associated with investing in stocks of larger, more established companies.
Securities of smaller companies may be thinly traded (and therefore have to
be sold at a discount from current prices or sold in small lots over an
extended period of time), may be followed by fewer investment research
analysts, and may be subject to wider price swings thus creating a greater
chance of loss than securities or larger capitalization companies.
Foreign Securities: The Fund may invest up to 15% of its assets in foreign
securities. Investments in foreign securities may present risks not
typically involved in domestic investments. The Fund may purchase foreign
securities directly, on foreign markets, or those represented by American
Depositary Receipts ("ADRs"). ADRs are US dollar denominated and traded in
the US on exchanges or over the counter. By investing in ADRs rather than
directly in foreign issuers' stock, the Fund may possibly avoid some
currency and some liquidity risks. The information available for ADRs is
subject to the more uniform
-2-
<PAGE>
and more exacting accounting, auditing and financial reporting standards of
the domestic market or exchange on which they are traded.
Fund Policies and Restrictions
c) Concentration: The Fund has a special interest in Alternate Energy. The
Fund concentrates at least twenty-five percent (25%), except during
defensive periods, of its investments in common shares of companies, which
have an interest in alternate energy.
Investment Restrictions
The following investment restrictions are deemed to be fundamental policies of
the Fund. As such, the Fund may not, without the affirmative vote of a majority
of its shareholders*:
1- Borrow money, except from banks for temporary or emergency purposes in an
amount not in excess of five percent (5%) of the market value of its
total assets (not including the amount borrowed). The Fund will not
invest in portfolio securities while outstanding borrowing exceeds five
percent (5%) of the market value of its assets. The Fund does not intend
to borrow at all.
2- Purchase on margin or sell short or write or purchase put call or call
options.
3- Pledge any of its assets except that up to ten percent (10%) of the
market value of its total assets may be pledged in connection with
borrowing permitted by (1) above. The Fund does not intend to pledge any
of its assets.
4- Lend any of its assets other than through the purchase of a portion of
publicly distributed notes, bonds, negotiable certificates of deposit or
other debt securities.
5- Underwrite or participate in any underwriting of securities, except to
the extent that, in connection with the disposition of portfolio
investments, the Fund may be deemed to be an underwriter under the
federal securities law.
6- Buy more than ten percent (10%) of the outstanding voting securities of
any one issuer.
7- Buy securities of any company (including its predecessors or controlling
persons) that has not been in business for at least three (3) continuous
years, if such investment at the time of purchase would cause more than
ten percent (10%) of the total assets of the Fund (at market value) to be
invested in securities of such companies.
8- With respect to seventy-five percent (75%) of its assets (at market
value), invest more than five percent (5%) of such assets in securities
of any one issuer, other than the US Government, its agencies or
instrumentality.
9- Buy or hold securities of any issuer if, to the knowledge of the Fund,
any Officer, Director or ten (10%) shareowner of the Manager owns
individually one-half (1/2) of one percent (1%) of a class of securities
of such issuer and such persons owning one-half (1/2) of one percent (1%)
of such class together own beneficially more than five percent (5%) of
such securities.
10- Purchase securities of any other investment company, except as part of a
merger,
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<PAGE>
consolidation or other recognition.
11- Participate, on a joint or joint and several basis, in any trading
account in securities.
12- Buy or sell any real estate, real estate mortgages, commodities or
commodity contract.
13- Issue senior securities.
14- Invest more than ten percent (10%) of its total assets (at market value)
in securities the disposition of which would be subject to legal
restriction or securities for which there are no readily available market
quotations. The Fund does not intend to invest in any restricted
securities or securities for which there are not readily available market
quotations.
15- Will not engage in arbitrage or trade for the control or management of
another company.
16- Invest more than fifteen percent (15%) of its assets in securities of
companies outside the United States.
17- Invest more than twenty-five percent (25%) of the Fund's assets in any
single industry; excluding the solar and alternative energy industries as
described in the "Investment Objectives" and "Choice of Companies for
Investments" sections of the prospectus in which the Fund will always
invest more than twenty-five percent (25%) of its assets excepting during
defensive periods.
17a (Texas) Invest in warrants, which valued at the lower of cost or market,
may not exceed five percent (5%) of the value of the Fund's assets.
Included within that amount, but not to exceed two percent (2%) of the
value of the Fund's net assets, may be warrants which are not listed.
Warrants acquired by the Fund in units or attached to securities may be
deemed to be without value. The Fund will not invest in oil, gas or other
mineral leases. The preceding restriction (17A) is meant to comply with
rules of the Texas Securities department.
d- Temporary Defensive Position
For temporary defensive purposes - which may include a lack of adequate
purchase candidates or an unfavorable market environment - the Fund may invest
in cash or cash equivalents. Cash equivalents include instruments such as US
Government and agency obligations, certificates of deposit and time deposits.
Item 13
Management of the Fund
a- Board of Directors
Under the laws of the state of New York, the Board of Directors of the Fund is
responsible for managing the business and affairs of the Fund.
-4-
<PAGE>
b- Directors And Officers
<TABLE>
<CAPTION>
Name, Address & Age Position with Fund
<S> <C> <C>
*Maurice L. Schoenwald Director, Chairman Member of New York
Age 79 Vice President (1947) & Florida (1978) Bar;
Longboat Key, FL Fund Chairman & Founder;
Bayshore, NY author of articles on legal and
investment questions; former
faculty, Hofstra University. Chairman of
Accrued Equities.
*David J. Schoenwald Director, President Member of New York Bar
Age 49 Secretary, Treasurer (1979); Fund founder. Formerly
Huntington Bay, NY reporting staff of Newark Star
Ledger; Now member, Schoenwald
& Schoenwald P.C., Attorneys;
Son of Maurice L. Schoenwald. President of
Accrued Equities.
Arthur G. Kaplan Director Admitted to practice law,
Age 76, Retired New York (1951), Oregon (1956)
Lake Oswego, OR District of Columbia (1959);
Formerly Assistant Attorney General
State of Oregon; Assistant Counsel,
two U.S. Senate Subcommittees;
Special Counsel, Curtis Publishing
Co.; retired as Director of
enforcement, Office of Anti-boycott
Compliance, U.S. Department of
Commerce.
Sharon Reier Director Financial Journalist
Age 51 contributing to Business Week &
Coconut Creek, FL International Herald Tribune.
Former Regional Editor Financial
World Magazine; Former Editor With
Board Room; Former contributing editor;
Institutional Investor; Formerly
staff of Forbes & American Bankers.
Dorothy Wayner Director President Dwayner/
Age 61 Communications/Advertising and
New York Publishing, NY. MBA-New York
University: member and former
officer board director of Advertising
Women of New York, a private
Organization; President Kaleidoscope Kids,
Inc. a non-profit Organization
promoting creativity In middle school
kids.
Lee Clayton Director R.N., MS; First Fund Investor. Member
Age 72, Retired Sierra Club & New York Nature
New York Conservancy.
-5-
<PAGE>
Dudley Clayton Director Graduate Education in Horticulture.
Present director and
Age 76, Retired retired superintendent of Pinelawn
New York memorial Park. Outdoors man and
environmentalist.
Daniel Wolfson Director Former Resource manager,
Age 39 Farm & Wilderness Foundation
Woodstock, Vermont Plymouth, VT. Developed forest 7 Wildlife
habitat for conservation area. B.S.
Environmental studies, Hampshire College;
MS Resource Management, Antioch
University. Medical student at University
of Vermont.
</TABLE>
c) (1) *Interested person, as defined in the Investment Company Act of 1940.
Maurice L. Schoenwald is Secretary and minority shareholder of Accrued Equities
Inc., the Advisor. David Schoenwald is majority shareholder and president of
Accrued Equities, Inc. David Schoenwald is Maurice's Son. Accrued Equities
Inc., is the Fund's investment advisor and principal underwriter.
d- Compensation Table for Fund Directors and Fund Paid Staff
Fund Staff Earning More Than $60,000 from Fund: None
Annual Total Compensation of Each Director: $300.00
Income of Directors from other mutual funds: None
Compensation From Fund of Directors part of manager: None
Retirement Benefits from Fund for Staff or Director: None
Compensation of Directors and Officers. A three hundred dollar fee was paid to
each "uninterested" director by the Fund for the preceding year. No
compensation was paid to each "interested" Directors and Officers. No other
compensation is or was paid. Interested officers and directors are paid by the
manager. Coach travel expense to s director meeting which exceed 500 miles will
be paid to the extent that the expense is incurred.
e- Sales Load
Certain categories of people or institutions may invest in the Fund without
paying a sales charge. These include current and retired directors, officers
and employees of the Fund or the Fund's advisor and their families, registered
representatives of brokers distributing the Fund's shares who are purchasing
for their own personal account, Non Profit or Charitable organizations (as
defined in Section 501 (C) (3) of the Internal Revenue Code) investing $50,000
or more and clients of investments advisors purchasing for their own accounts
who are charged ongoing management fees for their advisors services. Persons in
the above categories must make their status as such known to the Fund's
transfer agent.
(See Prospectus).
Item 14
Control Persons and Principal Holders of Securities
The following persons own of record, or beneficiary five percent (5%) or more
of the
-6-
<PAGE>
Fund's shares:
Name Ownership #Shares % Of Total on
12/31/98
None
As of December 31, 1998 the number of shares and percentage of the total number
of shares owned by record or beneficially by the Directors and Officers of the
Fund are respectively 12,115.253 and 1.047% of the outstanding shares of the
Fund.
Item 15
Investment Advisor and Other Services
a- Investment Manager
The Investment Advisor/Manager is Accrued Equities, Inc. of 150 Broadhollow
Road, Suite 306, Melville NY 11747. The telephone number is (516) 423-7373.
This is a New York Corporation, organized in 1954.
The original investment clients of Accrued Equities, Inc. were limited to legal
clients of Maurice Schoenwald. Since 1966 the company has offered investments
to the public.
The controlling stockholder and President of the Investment Manager is David J.
Schoenwald. He is also President of the Fund. David J. Schoenwald is presently
serving as legal counsel to Accrued Equities, Inc. David J. Schoenwald is a
member of the law firm of Schoenwald & Schoenwald P.C.
Maurice L. Schoenwald is Vice President of the Investment Manager and Chairman
of the Board of Directors of the Fund. He is a minority stockholder of Accrued
Equities, Inc.
Under the Management Agreement, the Manager receives a monthly fee from the
Fund at the following annual rates based on the average net assets of the Fund
at the end of each month:
Annual Rate Assets
1% First $10 million
.75% Amounts over $10 million
.50% Amounts over $30 million
.45% Amounts over $100 million
Such fee is higher than that of some other mutual funds. For the year ended
December 31, 1998 the Manager /Advisor received $281,189 for its advisory fee.
For the year ended December 31, 1997 the Manager/Advisor received $282,694.68
for its advisory fee. For the year ended December 31, 1996 the Manager/Advisor
received $270,843 for its advisory fee.
In addition to the management fee, the Fund pays other expenses incurred in its
operation including, among others, taxes, brokerage commission, fees of
directors who are not affiliated with the manager, securities registration
fees, charges of custodians, shareholders services and transfer agent services,
dividend disbursing and reinvestment expenses,
-7-
<PAGE>
auditing and legal expenses, the typesetting costs involved in the printing of
the Prospectus sent to existing shareowner, costs of shareowner's reports, and
the cost of printing prospectuses for distribution to non-shareholders are paid
for by the manager.
Under the Management Agreement, if total expenses of the Fund for any fiscal
year, including the management fee, but excluding interest, taxes, brokerage
commissions and extraordinary expenses excludable by state laws, exceed the
applicable expense limitations set by states securities regulations in those
states in which the company may make regular sales, the Manager will reduce its
compensation by the amount by which such expenses exceed state limitations.
The Manager will, as required, lease at the expense of the Fund office space.
Other Fund expenses include the cost of telephone equipment and usage, and
supplies and customary clerical and professional services including preparation
of reports, forms, tax returns, distributions, shareholder inquiries, net asset
valuations, bookkeeping and like services.
The Management Agreement was approved by the Fund's Board of Directors
(including a majority of Independent Directors) and by the Fund's shareholders
on September 25, 1998.
The Management/Advisory Agreement must be approved each year by (a) a vote of
the Board of Directors of the Fund, or (b) a vote of the shareowners, and in
either case, by a majority of the independent directors. Any changes in the
terms of the Management Agreement must be approved by the shareowner. The
Management Agreement automatically terminates upon its assignment. In addition,
the Management Agreement is terminable at any time without penalty by the Board
of Directors of the Fund or by a vote of the holders of a majority of the Funds
outstanding shares (as defined above) on sixty (60) days notice to the manager
and by the manager on sixty (60) days notice to the Fund.
Personal Investment Policy. The Fund and Accrued Equities, Inc. have adopted a
personal investing policy consistent with Investment Company Institute
guidelines.
b- Principal Underwriter
The principal distributor of the Fund is Accrued Equities, Inc. of 150
Broadhollow Road, Melville New York 11747. Fund shares are offered on a best
efforts continuous basis. David and Maurice Schoenwald are Officers of Accrued
Equities, Inc. and New Alternatives Fund, Inc.
c) Services Provided by Investment Adviser & Fund Expenses Paid by Third
Parties
As described in the prospectus, Accrued Equities, Inc. is manager and
investment advisor providing services under the Advisory Agreement. Accrued
Equities, Inc. manages the Fund's assets.
d-Service Agreements
Custodian: The Custodian of the Fund is United Missouri bank, 928 Grand Avenue,
Kansas City, M.O. 64141. The Fund's cash securities are kept with the Custodian
-8-
<PAGE>
pursuant to an agreement dated October 28, 1994. The Fund pays the Custodian
pursuant to a regular schedule of charges based on a schedule agreed on from
time to time by the Fund and the Custodian.
The Custodian attends to the collection of proceeds of securities sold by the
Fund, collection and deposit of dividends and disbursements for the cost of
securities.
Transfer Agent and Dividend Paying: First Data Investor Services Group, 211
South Gulph Road, PO Box 61503, King of Prussia PA 19406-9993 serves as the
Transfer Agent and Dividend Paying Agent for the Fund, pursuant to an agreement
effective October 1, 1993. Telephone: (610) 239-4600.
Payments to Fund Plan Services, predecessor of First Data Investor Services
Group over the past three years were as follows:
Custodian Transfer Agent Pricing
1998 $20,075 $43,800 $30,726
1997 $20,075 $41,561 $29,371
1996 $20,716 $39,894 $29,280
Independent Auditor: Kenneth Katz, CPA of 64 North Park Avenue in Rockville
Centre, NY 11570. The independent accountant provides audit services, review of
tax returns, preparation and review of certain documents to be filed with the
Securities and Exchange Commission. He has serviced the Fund since its
inception.
Legal Counsel: Eric J. Schmertz of Riverdale NY, age 72, former Dean of Hofstra
University Law School is the legal counsel for the Fund.
e- Dealer Re-allowance
Purchase Amount Sales Commission Dealer Re-allowance Sales Commission
As a Percentage of as a Percentage of as a Percentage of
Offering Price Offering Price Net Asset Value
-------------- -------------- ---------------
$2,500 to $25,000 4.75% 4% 4.987%
$25,001 to $100,000 3.85% 3% 4%
$100,001 or more 2.91% 2% 3%
Year 2000
The Fund and its shareholders depend on the proper functioning of computer
systems maintained by First Data Investor Services Group. Many computer systems
in use today will require reprogramming or replacement prior to the year 2000
because of the way they store dates and make date-related calculations. The
Fund understands that these service providers are taking steps to address the
"Year 2000 issue". However, there can be no assurance that these steps will be
sufficient to avoid any adverse impact on the Fund. In addition, the Fund's
investments could be adversely affected by the Year 2000 problem. For example,
the markets for securities in which the Fund invests could experience
settlement problems and liquidity issues. Corporate and governmental data
processing errors may cause losses for individual issuers.
-9-
<PAGE>
Item 16
Brokerage, Allocation and Other Practices
Accrued Equities Inc. is a registered broker/dealer, but it will not engage in
brokerage or equity securities of the type which would be included in the
Fund's portfolio. No officer or Director of the Fund or its distributor is
associated with any firm having an economic interest in general stock brokerage
activities.
The choice of a broker will be made by the Manager without benefit to any
director or controlling person. Allocation of brokerage transactions, including
their frequency, will be made in the best judgement of the Manager and in a
manner deemed fair and reasonable to the shareholders, rather than by any
formula.
The primary consideration in all portfolio securities transactions is prompt
and reliable execution of orders at the most favorable net price. However, as
long as the primary consideration is satisfied, the Manager may give
consideration in the selection of broker/dealers to the research provided
(including analysis and reports concerning issuers, industries, securities,
economic factors and trends) by such firms, and payment may be made of a fee
higher than that charged by another broker/dealer which deems such allocation
of brokerage to be fair and reasonable to the shareholders.
Item 17
Description of Shares
The Fund's authorized capital is eight million (8,000,000) common shares of one
dollar par value. There is only one class of shares.
Each share entitles the holder to one vote. Fractional shares have no rights.
Share owners may vote for the election of Directors and all other appropriate
and customary matters and participate equally in dividends of capital and net
assets of the Fund on liquidation.
The common shares are fully paid and non assessable when issued, are redeemable
in accordance with the provisions set forth under the heading "Redemption of
Shares", and have no preference, pre-emptive or conversion rights. Fractional
shares entitle the holder to the same redemption, dividend, distribution and
other rights, excepting voting, as whole shares on a pro rata basis. No
certificates are issued for fractional shares.
The Fund will not ordinarily issue certificates for common shares purchased.
Certificates are generally unnecessary because (1) ownership of shares is
evidenced by a confirmation advice after each purchase or redemption,
indicating the amount invested and the purchase price per share or the amount
redeemed and the redemption price per share, and the number of shares owned
immediately after such transactions; and (2) redemptions and transfers may be
transacted without the issuance of certificates.
Shares certificates are issued only upon the specific request of the shareowner
made in writing. No charge is made for the issuance of shares certificates.
-10-
<PAGE>
Shares may not be transferred without written permission of the manager, which
is in the discretion of the manager and is generally limited to estates and
gifts within a family.
At the discretion of the manager, accounts with a total value, at the time of
notice, of $1,000 or less may be redeemed by the company after 10 days notice
by mail to the shareholder.
The common shares have non-cumulative voting rights so that the holders of more
than fifty percent (50%) of the shares voting for the election of Directors can
elect all the directors and in such event the holders of the remaining shares
voting for the election of the Directors will not be to elect any person or
persons to the Board of Directors. A simple majority of those shares voted in
person or by proxy participating in any duly called meeting on proper notice
shall be sufficient to pass any resolutions, excepting as otherwise required by
the Investment Company Act of 1940.
REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS. Any dividends paid by the Fund
from net investment income on its portfolio and any distributions of net
realized capital gains will automatically be reinvested in whole or fractional
shares of the Fund at net asset value on the record date unless a shareowner
makes a written request for payments in cash.
If a shareholder makes a specific written request for dividends or capital
gains distribution, such income or distribution payments, if any, will be paid
in cash at least annually.
Item 18
Purchase, Redemption and Pricing of Shares
HOW TO BUY SHARES: Shares of the Fund may be purchased by sending a Share
Purchase Application and a check to New Alternatives Fund, Inc. C/O First Data
Investor Services Group Inc., 211 South Gulph Road, PO BOX 61503, King Of
Prussia PA 19406. The application is on the last page of the prospectus.
The Fund's shares are sold directly by the Fund with the assistance of and at
the expense of Accrued Equities, Inc., which is compensated for such
assistance. All checks are to be made payable to New Alternatives Fund, Inc..
Independent brokers also sell the shares of the Fund. Sales charges are the
same irrespective of where or through whom you purchase. Social security
numbers or tax numbers are required on the application.
The Fund and American Funds distributors, the Fund's Principal Underwriter
reserve the right to reject any purchase order for any reason.
Retirement Plans and IRA Accounts: Shares of the Fund may be purchased directly
by existing retirement plans, which allow such investments.
In addition, qualified individuals may establish an Individual Retirement
Account ("IRA") or Roth IRA to be funded with shares of the Fund. The Fund has
made arrangements with Semper Trust Company to act as Custodian for any IRAs
thus created.
Automatic Investment Plan: Shareholders meeting the investment minimum may
establish
-11-
<PAGE>
an automatic investment plan wherein periodic drafts from a checking or savings
account are invested in the Fund, subject to the same sales charge recited in
this prospectus. Such plan may be canceled by the Fund or the investor upon
written notice to the transfer agent no later than 5 business days prior to a
schedule debit date.
REDEMPTION OF SHARES: There is no redemption charge. Fund shares are redeemed
upon tender of the written request of any shareholder, accompanied by surrender
of share certificates, if issued.. All certificates and/or requests for
redemption tendered must be signed or endorsed by the shareholder or
shareholders in whose name or names the shares are registered. Signature or
signatures must be guaranteed by a commercial bank or trust company or
federally chartered savings bank, Savings and Loan Association or credit union
located in the United States or having a correspondent relation with a
commercial bank or trust company in the United States, or by a member firm of
the New York Stock Exchange (except that guarantee of the signature or
signatures on a request for redemption of $2,500 or less may be waived, if
approved by the Fund). Tender shall be made at the office of the Transfer Agent
First Data Investor Services Group, Inc., 211 South Gulph Road, PO BOX 61503,
King Of Prussia, PA 19406-9993.
The redemption price will be the net asset value of the Fund's shares next
computed after the tender is received by the Fund. Payment of the redemption
price will be made by a check drawn and issued in the U.S. within seven (7)
days after receipt of the written request and certificates as described above,
or if payment for the purchase of the shares to be redeemed has not been
cleared by that time, the mailing of the redemption check may be postponed
until proceeds of any check for the purchase price of the shares has been
collected. If payment for shares are dishonored the Fund may cancel the
purchase.
For further information, an interested person should call the Fund at (516)
423-7373 or (800) 423-8383.
Offering Price
SALES CHARGE: The sales charge you pay when purchasing the stock, stock/bond,
and bond funds of the American Funds Group are set forth below.
NET ASSET VALUE: The net asset value of a Fund share is determined once daily
as of the close of each day of trading on the New York Stock Exchange. Net
asset value is determined by subtracting all liabilities of the Fund from the
value of its total assets and dividing the resulting figure by the number of
Fund shares and fractional shares outstanding.
Shares are purchased at the offering price next determined after the purchase
order is received by the Fund. The price you pay for shares, the offering
price, is based on the net asset value per share plus a sales load which is
calculated once daily at the close of trading (currently 4:00 p.m., Eastern
Time) each day the New York Stock Exchange is open
In determining the Fund's net asset value, securities for which current market
quotations are readily available are valued in the following manner: securities
traded on national exchanges are valued at the closing sales price, or, if no
sale occurred, at the last price traded. Over-the-counter securities for which
no sales were reported on a particular day
-12-
<PAGE>
are valued at the last closing price. Securities for which current market
quotations are not readily available are valued at their fair value as
determined in good faith by the Board of Directors. The Board will continue to
review its over-all methods of valuation to assure that all assets are properly
valued.
The daily calculation of net asset value is performed by First Data Investor
Services Group, which also serves as transfer agent.
Item 19
Taxation of the Fund
Tax Status: the Fund will endeavor to qualify annually for tax treatment
applicable to a regulated investment company under the Internal Revenue Code of
1954, as amended ("Code"). Pursuant to the requirements of the Code, the Fund
intends to pay, at least annually, dividends representing substantially all of
its net investment income. It also intends, at least annually, to distribute
any realized capital gains. As a regulated investment company, the Fund will
not be subject to the United States income tax on net ordinary income and net
capital gains, which are distributed by the Fund, pursuant to the requirements
of the "Code". The status of the Fund as a regulated investment company does
not involve government supervision of management or of investment practices or
policies.
For Federal income tax purposes distributions paid from the Fund's net
investment income and net realized short-term capital gain are taxable to
shareholders as ordinary income, whether received in cash or in additional
shares. Distributions paid from long-term capital gain are taxable as long-term
capital gains, whether received in cash or shares. However shareholders,
shareholders not subject to tax on their income will not be required to pay
Federal income taxes on amounts distributed to them. Shareholders will be
notified annually as to the Federal tax status of dividends and distributions.
Subject to regulations of the Internal revenue Service, the Act may require
individuals who are shareholders of the Fund to include their pro rata share of
the und's investment expenses (such as investment advisory fees), in addition
to distributions received, in computing their taxable income.
Item 20
Underwriters
The aggregate commission retained by the Principal Underwriter on sales of Fund
shares during the fiscal year ended December 31, 1998 was 90,357 and the amount
retained by Accrued Equities was $57, 173. Commission retained by the Principal
Underwriter on sales of fund shares during the fiscal ended December 31, 1997
were $92,234 and the amount retained by Accrued Equities was $51,403. The
aggregate commission retained by the Principal Underwriter for the year ended
December 31, 1996 was $96, 937 and the amount retained by Accrued Equities was
$48,539.
-13-
<PAGE>
PERIOD ENDING 12/31/98 COMPENSATION OF ACCRUED EQUITIES INC.
NAME OF UNDERWRITING COMPENSATION OTHER
PRINCIPAL DISCOUNTS & ON REDEMPTION BROKERAGE COMPENSA
UNDER COMMISSION & REPURCHASE COMMISSION TION
WRITER
Accrued
Equities, Inc. $57,173.08 -0- -0- $281,189
Item 21
Investment Results And Related Statistics
The total return after deducting maximum possible one time (4.75) sales charge
for the one year period ending December 31, 1998 was -14.25%. The average
annual total returns for the five and ten year periods ended on December 31,
1998 were 2.4% and 7.5% respectively, and 9.65% since inception of the Fund.
These fund results were calculated according to a standard formula, which
requires that the maximum sales charge of 4.75% be reduced. Results would ne
higher if they were calculated at net asset value.
The Standard & Poor's 500 Index and the Russell 2000 Index represent stocks.
These indexes are not managed and do not reflect sales charges, commissions or
expenses.
The average annual total return (T) is computed using the value at the end of
the period (ERV) of a hypothetical initial investment of $1,000 (P) over a
period of years (n) according to the following formula as required by the
Securities and Exchange Commission:
P(1+T)/n/+ERV
The following assumptions will be reflected in computations made in accordance
with formula stated above: (1) deduction of the maximum sales load of 4.75%
from the $1,000 initial investment; (2) reinvestment of dividends and
distributions at net asset value on the reinvestment date determined by the
Board; and (3) a complete redemption at the end of any period illustrated.
To calculate total return, an initial investment is dividend by the offering
price (which includes the sales charge) as of the first day of the period in
order to determine the initial number of shares purchased. Subsequent dividends
and capital gain distributions are then reinvested at net asset value on the
reinvestment date determined by the Board of Directors. The sum of the initial
shares purchased and shares acquired through reinvestment is multiplied by the
ending value. The difference between the ending value and the initial
investment divided by the initial investment converted to a percentage equals
total return. The resulting percentage indicates the positive or negative
investment results that an investor would have experienced from reinvested
period. Total return may be calculated for one year, five years, ten years and
for other periods of years. The average annual total return over periods
greater than one year may also be computed utilizing ending values as
determined above.
-14-
<PAGE>
Item 22
Financial Statement
-15-
<PAGE>
ANNUAL FINANCIAL REPORT
DECEMBER 31, 1998
<PAGE>
<TABLE>
<CAPTION>
Year Year Year Year Year Year Year Year Year
End End End End End End End End End
12/31 12/31 12/31 12/31 12/31 12/31 12/31 12/31 12/31
1998 1997 1996 1995 1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE AT
BEGINNING $32.07 $30.87 $30.51 $28.14 $30.0 $29.95 $29.19 $24.62 $27.57
OF PERIOD ------ ------ ------ ------ ----- ------ ------ ------ ------
Investment Income $.52 $.64 $.73 $.75 $.72 $.62 $.62 $.72 $.70
Expenses .37 .38 .39 .40 .40 .33 .28 .29 .27
Net Investment Income .15 .26 .34 .35 .32 .29 .34 .43 .43
Net realized &
Unrealized gain (Loss) (3.07) 3.16 3.72 5.14 (1.43) .58 1.10 5.86 (2.53)
on investment ----- ---- ---- ---- ----- --- ---- ---- -----
Total from Investment (3.22) 3.42 4.06 5.49 (1.11) .87 1.44 6.29 (2.10)
operations
Dividends from net (.15) (.26) (.34) (.35) (.32) (.29) (.34) (.43) (.43)
investment income
Distributions from net
realized gain (.16) (1.96) (3.36) (2.77) (.43) (.53) (.34) (1.29) (.42)
---- ----- ----- ----- ---- ---- ---- ----- ----
Total Distributions (.31) (2.22) (3.70) (3.12) (.75) (.82) (.68) (1.72) (.85)
Net change in asset value (3.53) 1.20 .36 2.37 (1.86) .05 .76 4.57 (2.95)
Net asset value as of
end $28.54 32.07 30.87 30.51 28.14 30.00 29.95 29.19 24.62
of the period ------ ----- ----- ----- ----- ----- ----- ----- -----
Total return
(Sales load not (10%) 11.1% 13.3% 19.5% (3.7)% 2.9% 4.9% 25.6% (7.6)%
reflected)
Net assets, end of $33,021 $37,941 $35,549 $32,236 $28,368 $31,567 $28,896 $23,931 $16,433
period
Ratio of operating
expense to net asset 1.18% 1.15% 1.21% 1.28% 1.30% 1.11% 1.04% 1.18% 1.27%
Ratio of net investment
income to average net .49% .79% 1.04% 1.12% 1.04% .96% 1.25% 1.74% 2.08%
assets**
Portfolio turnover 32.4% 53.9% 51.2% 48.72% 33.00% 18.36% 13.10 21.50 24.70
Number of shares 1,156,952 1,111,377 1,038,561 965,769 984,847 1,026,460 945,006 776,974 646,664
outstanding at end of
period***
<CAPTION>
Year Year Year Year First
End End End End Seven
12/31 12/31 12/31 4/30 Months
1989 1988 1987 1987 4/30/83
**** ****
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE AT
BEGINNING $22.55 $18.85 $22.43 $19.68 $12.50
OF PERIOD ------ ------ ------ ------ ------
Investment Income $.73 $.67 $.40 $.38 $.38
Expenses .26 .26 .16 .16 .20
Net Investment Income .47 .42 .24 .22 .18
Net realized &
Unrealized gain (Loss) 5.41 4.09 (3.21) 3.45 3.08
on investment ---- ---- ----- ---- ----
Total from Investment 5.88 4.51 (2.97) 3.67 3.26
operations
Dividends from net (.47) (.42) (.24) (.22) (.18)
investment income
Distributions from net
realized gain (.39) (.39) (.38) (.70) (.19)
---- ---- ---- ---- ----
Total Distributions (.86) (.81) (.62) (.92) (.37)
Net change in net asset
value 5.03 3.71 (3.59) 2.75 2.89
Net asset value as of
end 27.57 22.55 18.85 22.43 15.39
of the period ----- ----- ----- ----- -----
Total return
(Sales load not 26.0% 23.9% (2.6)% 22.2% 10.4%
reflected)
Net assets, end of $11,89 $6,162 $4,133 $3,404 $163
period 3
Ratio of operating
expense to net asset 1.25% 1.24% .80% 1.17% 1.08%
Ratio of net investment
income to average net 2.20% 2.18% 1.23% 1.68% 1.69%
assets**
Portfolio turnover 14.60 25.88 8.57% 8.79% 74.50%
Number of shares 1 419,212 264,414 212,704 151,848 10,592
outstanding at end of
period***
</TABLE>
* All adjusted for two for one share split on July 26, 1985 and
January 2, 1990
** Annualized and includes state taxes
*** Shares immediately prior to dividend - Fund commenced operation on
September 3, 1982
**** At this time the fund was on a fiscal year. Table for 1983-1987 is
available on request. Deleted to make space.
<PAGE>
DECEMBER 31, 1998
NEW ALTERNATIVES FUND, INC.
STATEMENT OF INVESTMENTS
COMMON STOCKS : 75%
- ----------------------
SHARES MARKET VALUE
ALTERNATE ENERGY: 10.7%
- ----------------------------------
*AstroPower 15000 $ 144,375.00
*Ballard Power 5000 137,500.00
*Bonneville Pacific Corp 32325 169,706.25
*Calpine 15000 378,750.00
*Energy Conversion Devices 1000 7,250.00
*Energy Research Corp 25000 350,000.00
Enron (Also Natural Gas) 25000 1,426,562.50
Idaho Power 5000 180,937.50
*Mechanical Technology 5000 40,625.00
*Real Goods Trading 1000 4,062.50
*Thermo Power 15000 115,312.50
Trigen 50000 571,875.00
------------
$ 3,526,956.25
CLEAN AIR: 3.3%
- ----------------------------------
*BHA Group 25000 $ 346,875.00
*Thermo Instruments 50000 753,125.00
------------
$ 1,100,000.00
CLEAN WATER : 7.7%
- ----------------------------------
Ameron 15000 $ 555,000.00
Aquarion 15000 615,000.00
*U.S. Filter 60000 1,372,500.00
------------
$ 2,542,500.00
CONSERVATION : 7.6%
- ----------------------------------
Interface Inc. 30000 $ 278,436.00
Owens Corning 25000 885,937.50
Minerals Technology 20000 818,750.00
T J International 20900 536,868.75
-----------
$ 2,519,992.25
ENVIRONMENTAL (GENERAL) : 6.1%
- ----------------------------------
Dames & Moore 15000 193,125.00
*Flow International 40000 387,500.00
*Superior Industries 30000 601,875.00
*Tetra Tech 12500 338,281.25
*Thermo Electron 30000 508,125.00
------------
$ 2,028,906.25
EFFICIENT ELECTRIC DEVICES : 5.7%
- ----------------------------------
Baldor 35000 $ 708,750.00
*SLI 42500 1,179,375.00
------------
$ 1,888,125.00
NATURAL FOODS : 14.3%
- ----------------------------------
*Gardenburger 15000 $ 172,500.00
*Horizon Organic 25000 387,500.00
*United Natural Foods 40000 965,000.00
*Whole Foods Markets 30000 1,451,250.00
*Wild Oats 40000 1,260,000.00
Worthington Foods 25000 475,000.00
------------
$ 4,711,250.00
<PAGE>
DECEMBER 31, 1998
NEW ALTERNATIVES FUND, INC
STATEMENT OF INVESTMENTS (CONTINUED)
SHARES MARKET VALUE
------ ------------
RECYCLING 4.2%
- --------------------------------
Caraustar Ind 20000 $ 571,250.00
Imco Recycling 20000 308,750.00
Republic Group 25000 501,562.50
-----------
1,381,562.50
NATURAL GAS
- -----------
TRANSMISSION & DISTRIBUTION 8.5%
- --------------------------------
Energen 15000 $ 292,500.00
Keyspan Energy Corp. 25000 775,000.00
KN Energy 10000 363,750.00
MCN 20000 381,250.00
National Fuel Gas 15000 677,812.50
Williams Co's 10000 311,875.00
------------
$2,802,187.50
RAILROADS 6.9%
- --------------------------------
Burlington Northern Rail 30000 $ 1,012,500.00
Norfolk Southern Railway 40000 1,267,500.00
------------
$ 2,280,000.00
Total Common Stock (cost $22,426,464.26) $24,781,479.75
Market Deposits and Treasury Bills :24.5%
Socially Concerned Banks
Alternatives Federal Credit Union $ 100,000.00
Community Capital Bank 100,000.00
South Shore Bank 100,000.00
Vermont National Bank 100,000.00
U.S. Treasury Bills (cost $7,663,310.27) 7,682,054.30
------------
$ 8,082,054.30
Total Common Stock (75%) $24,781,479.75
Bank money market and Treasury Bills(24.50%) 8,082,054.30
Cash and **Receivables, less liabilities (0.50)% 158,185.04
--------------
NET ASSETS (100 %) $33,021,719.09
*Securities for which no cash dividends were paid during the
fiscal year
<PAGE>
NEW ALTERNATIVES FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31 1998
ASSETS
Investment Securities at market value
(Cost:$22,426,464.26) (Notes 2A and 5)..........$24,781,479.75
Bank money market deposits....................... 400,000.00
U.S.Treasury Bills at market..................... 7,682,054.30
Cash............................................. 65,092.45
Receivables: Dividends.......................... 23,212.00
Interest........................... 587.77
Securities Sold.................... 168,494.37
Subscriptions receivable........... 5,481.08
------------
Total Assets ..................................$33,126,401.72
LIABILITIES
Payables: Accrued Operating Expenses :
Accounting.................................... $ 403.00
Custodian................................ .... 2,560.30
Directors Fees ............................... 1,483.27
State Taxes .................................. 450.19
Advisory fee ................................. 22,302.69
Regulatory fees .............................. 7,019.73
Printing ..................................... 6,921.16
Bond and Insurance............................ 3,770.72
Transfer Agent-Fund Plan Services............. 4,263.63
Fund Pricing-Fund Plan Services............... 2,056.49
Other......................................... 3,442.19
---------
54,673.37
Securities Purchased.......................... ---
Redemptions Payable........................... 10,000.00
Dividend distribution payable................. 40,009.26
Total Liabilities ............................ $ 104,682.63
-----------
Net Assets at market, applicable to 1,156,952.553
outstanding shares. There are eight million common shares authorized. There is
only one class of common stock. (note 3)
==============
$33,021,719.09
<PAGE>
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDING DECEMBER 31, 1998
INVESTMENT INCOME AND EXPENSE
INCOME :
Dividends.....................................$ 392,032.63
Interest ..................................... 212,657.58
----------
Total Income .................................$ 604,690.21
EXPENSES :
Management Fee (note 4) ..................... $ 281,189.52
Custodian fees
United Missouri Bank......................... 20,075.00
State Taxes.................................. 430.70
Accounting .................................. 4,369.00
Directors ................................... 2,671.80
Filing Fees.................................. 11,169.00
Postage and Printing ........................ 14,600.00
Bond and Insurance .......................... 6,454.85
Transfer Agent-First Data ................... 43,800.00
Fund Pricing-First Data ..................... 30,726.00
Other........................................ 12,775.00
---------
Total Expenses .............................. $ 428,262.87
NET INVESTMENT INCOME ....................... $ 176,427.34
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
REALIZED GAIN ON INVESTMENTS (note 2B&5)
Proceeds from sales..........................$15,034,579.58
Cost of Securities Sold ..................... 14,846,575.61
-------------
Net Realized Gain ...........................$ 188,003.97
UNREALIZED APPRECIATION (DEPRECIATION) of investments :
Beginning of period .........................$ 6,572,267.08
End of period .............................. 2,355,015.49
------------
Total unrealized appreciation (depreciation).$(4,217,251.59)
For the period.
Net realized and unrealized gain (loss)
on investments .... ........................ $ 756,327.18
------------
Net increase (decrease) in net assets
resulting from operations....................$(3,852,820.28)
--------------
<PAGE>
NEW ALTERNATIVES FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
Year End Year End
12/31/98 12/31/97
FROM INVESTMENT ACTIVITIES:
- ---------------------------
Net Investment Income .... $ 176,427.34 $ 288,448.08
Net Realized gain from
security transactions..... 188,003.97 2,179,207.35
Unrealized appreciation
(depreciation) of investments.. (4,217,251.59) 1,408,056.31
------------- --------------
Increase (decrease) in net assets
derived from investment
activities.......... $(3,852,820.28) $ 3,875,711.74
-------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS :
- -------------------------------
From net investment income
dividends to shareholders .. $ (176,501.42) $ (288,422.67)
Distributions to shareholders.. (188,130.28) (2,179,188.28)
FROM CAPITAL SHARE TRANSACTIONS :
- ---------------------------------
Net increase (decrease) from
Capital transactions (note 3)... $ (702,052.38) $ 984,268.75
INCREASE (DECREASE) IN
- ----------------------
NET ASSETS:.............. $(4,919,504.36) $ 2,392,369.54
- ----------
NET ASSETS AT :
- ---------------
Beginning of the period... $37,941,223.45 $ 35,548,869.45
------------- --------------
End of the period... $33,021,719.09 $ 37,941,238.99
------------- --------------
<PAGE>
NOTES TO FINANCIAL STATEMENT FOR THE
YEAR ENDING DECEMBER 31, 1998
1) ORGANIZATION - The fund is registered as an open-end investment company
under the Investment Company Act of 1940, as amended. The fund commenced
operations September 3, 1982.
2) ACCOUNTING POLICIES - The following is a summary of significant accounting
policies consistently followed by the fund in the preparation of these
financial statements. The policies are in conformity with generally accepted
accounting principles:
A. SECURITY VALUATION - listed investments are stated at the last sale price at
the closing of the New York Stock Exchange, the American Stock Exchange and the
NASD National Market System on December 31, 1998 and at the mean between the
bid and asked price on the over the counter market.
B. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions
are accounted for on the trade date (date order to buy or sell is executed).
Realized gains and losses from security transactions are reported on a first
in, first out basis.
C. INVESTMENT INCOME AND EXPENSE RECOGNITION - Dividend income is recorded as
of the ex-dividend date. Expenses are accrued on a daily basis.
D. FEDERAL INCOME TAXES - No provision for federal income tax is believed
necessary since the fund intends to distribute all its taxable income to comply
with the provisions of the Internal Revenue Code applicable to investment
companies. The aggregate cost of the securities owned by the fund on December
31, 1998 for federal tax purposes is $22,426,464.26.
3) CAPITAL STOCK - There are eight million shares of capital stock authorized.
On December 31, 1998 there were 1,156,952.553 shares after the dividend.
Aggregate paid in capital including reinvestment of dividends was
$30,666,865.52. Transactions in capital stock were as follows:
Year End 12/31/98 Year End 12/31/97
Capital stock Shares $ Amount Shares $ Amount
sold......... 78,407.173 2,481,638.78 68,392.297 2,195,444.11
Capital stock
issued reinvest 11,477.383 327,935.59 68,554.443 2,198,834.61
ment of div..
Redemptions. (115,835.579) (3,511,626.75) (105,757.199) (3,410,009.97)
------------ -------------- ------------ -------------
Net Increase/ (25,951.023) $ (702,052.38) 31,189.541 $ 984,268.75
(decrease)
4) MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES - Pursuant to
agreements, Accrued Equities, Inc. serves as investment advisor to the Fund.
The Fund pays to Accrued Equities, Inc. an annual management fee of 1.00% of
the first $10 million of average net assets; 0.75% of the next $20 million; and
0.50% of net assets over $30 million and 0.45% of assets over $100 million. If
the net annual expenses of the Fund (other than interest, taxes, brokerage
commissions, extraordinary expenses) exceed the most restrictive limitation
imposed by any state in which the Fund has registered its securities for sale,
Accrued Equities reduces its management fee by the amount of such excess
expenses. The annualized expense ratio for the year ended December 31, 1998 was
1.18%. The fund pays no remuneration to its officers, each of whom is also an
officer of Accrued Equities, Inc.
5) PURCHASES AND SALES OF SECURITIES - During the six months ended December 31,
1998, the aggregate cost of securities purchased totaled $11,111,326.92. Net
realized gains were computed on a first in, first out basis. The amount
realized on sales of securities for the year ended December 31, 1998 was
$15,034,579.58.
<PAGE>
[THE NARRATIVE AND/OR TABULAR INFORMATION BELOW IS A FAIR AND ACCURATE
DESCRIPTION OF GRAPHIC OR IMAGE MATERIAL OMITTED FOR THE
PURPOSE OF EDGAR FILING.]
VALUE OF $10,000 INVESTMENT OVER PAST 10 YEARS
Past Performance is not predictive of Future Performance.
Average Annual Return (after deducting maximum sales charge):
One Year (10%); Five Years 5.44%; Ten Years 7.61%
FUND S&P 500 RESSELL 2000
01/01/89 $9,525.00 $10,000.00 $10,000.00
1989 $12,009.20 $13,122.80 $11,624.30
1990 $11,091.50 $12,705.60 $ 9,356.70
1991 $13,926.30 $16,487.30 $13,665.60
1992 $14,611.90 $17,665.20 $16,181.70
1993 $15,033.70 $19,364.40 $19,241.10
1994 $14,475.40 $19,659.30 $18,890.60
1995 $17,297.20 $26,699.10 $24,263.20
1996 $19,600.10 $32,645.80 $28,265.20
1997 $21,771.60 $43,327.50 $34,585.50
1998 $19,483.10 $55,471.80 $33,704.70
<PAGE>
Kenneth D Katz CPA
64 North Park Avenue
Rockville Centre, NY 11570
Report of Independent Accountant
To The Board of Directors and Shareholders
New Alternatives Fund Inc.,
Melville, NY
I have audited the statement of assets and liabilities of New Alternatives Fund
Inc (the Fund) including the schedule of portfolio investments by industry
classification, as of December 31, 1998, and the related statement of
operations for the year then ended, and the statements of changes in net assets
and the supplementary information-selected per share data and ratios. These
financial statements and supplementary information are the responsibility of
the Fund's management. My responsibility is to express an opinion on these
financial statements and supplementary information based on my audits.
I conducted my audits in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements and supplementary information
are free of material misstatement. An audit includes examining on a test basis,
evidence supporting the amounts and disclosures in the financial statements. My
procedures included confirmation of securities owned at December 31, 1998 by
correspondence with the custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. I believe that
my audit provides a reasonable basis for my opinion.
In my opinion the financial statements and selected per share data and ratios
referred to above present fairly, in all material respects, the financial
position of the Fund as of December 31, 1998, the results of operations for the
year then ended and the changes in its net assets and selected per share data
and ratios for the years in the periods then ended in conformity with generally
accepted accounting principles.
Kenneth D Katz CPA
Rockville Centre, NY
January 28, 1999
<PAGE>
Part C: Other Information
File 2 74436
File 811 3287
New Alternatives Fund, Inc.
Item 23
Financial Statements and Exhibits
a- (1) Charter is now in effect. Exhibit #1 (previously filed through Edgar
system. See Post- Effective Amendment No. 16 filed April 1997).
b- (2) By-Laws, Exhibit #2 (previously filed through Edgar system. See
Post-Effective Amendment No. 16 filed April 1997).
c- (3) Voting trust. Not applicable.
d- (5) Copy of Investment Management Agreement. Exhibit #4 (previously filed
through Edgar system. See Post-Effective Amendment No.16 filed April
1997).
e- (6) Copy of Underwriting Agreement. Exhibit #5 (previously filed with
Amendment(s) through Edgar system. See Post-Effective Amendment No. 16
filed April 1997).
f- (7) Profit Sharing and related plans. None.
g- (8) Copy of Custodian Agreement - (previously filed-United Missouri Bank).
h- (9) Copies of Materials Agreement - (previously filed herein for through
Edgar. See Post- Effective Amendment No. 17 filed March 1998).
A. Transfer Agent: First Data Investor Services Group, Inc.
B. Accounting Services: First Data Investor Services Group, Inc.
C. Custody Administration: First Data Investor Services Group, Inc.
i- (10) Opinion of Counsel. Exhibit #6 (filed with 24F-2 statement).
j- (11) Other Opinions and Consents. Consent of Independent Auditor filed
herewith.
k- (12) Financial Statements part 17. (Included in Prospectus).
l- (13) Copies of agreements in connection with original capital.
Exhibit #9 (previously filed).
m- (14) Copies of 12b-1 plan. None.
n- (15) Financial Data Schedule. None.
<PAGE>
o-(16) Rule18f-3 plan. None.
Item 24
Persons Controlled by or Under Common Control with the Fund.
This section is not applicable, excepting that David J. Schoenwald is the
controlling (55.5 %) stockholder of Accrued Equities, Inc.. Maurice L.
Schoenwald is a minority (44.5%) stockholder of Accrued Equities, Inc. Maurice
L. Schoenwald is Vice President and Chairman of the Board of Directors of the
Fund and owns 5266.648 shares or .455% of the Fund of record and beneficially.
David J. Schoenwald, President of the Fund and the son of Maurice L. Schoenwald
owns 2550.343 shares or .22% of the Fund.
New Alternatives Fund, Inc (the Fund) and Accrued Equities, Inc. (the
Manager/Advisor and Principal Underwriter) are New York Corporations.
There is only one class of securities, common stock, at one dollar par value.
There were 2548 holders of record of such shares on December 31, 1998.
Item 25
Indemnification
In the event of a claim in connection with the securities registered, the
registrant will, unless in the opinion of Counsel the matter may be settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question of whether or not indemnification is consistent with public policy as
expressed in the securities laws that may be applicable and will be governed by
the final adjudication of such issue.
On September 1, 1997 customary Directors and Officers Insurance was renewed
with Reliance Insurance Company , Philadelphia, PA. Such insurance policy
requires and provides that the company (Fund) have in effect by-laws and
resolutions or provisions providing for indemnification to the Insured
permitted and or required under applicable law. The Board of Directors approved
all change in documents necessary to obtain such insurance. The Board of
Directors, ratified the Fund's insurance selection at the directors meeting on
September 25, 1998. There are now in effect provisions for indemnification of
officers and directors to the extent permitted or required under all applicable
laws, including requirements of the Securities Act of 1933 and all of the rules
and regulations thereunder.
Item 26
Business and other Connections of the investment Advisor.
David J. Schoenwald is President of Accrued Equities, Inc. and an attorney
licensed in the state of new York. The business address of Accrued Equities,
Inc. and David J. Schoenwald is 150 Broadhollow Road, Suite 306, Melville, NY
11747. Maurice L. Schoenwald, is Secretary of Accrued Equities, Inc. and an
attorney in private practice. Accrued Equities, Inc. has managed in the past
real property, loans, mortgages and has been a broker-dealer in investment
contracts and
<PAGE>
a broker of investment contracts for receiverships initiated by the Securities
and Exchange Commission. The business address of Maurice L. Schoenwald is 5270
Gulf Of Mexico Drive, Unit 503, Longboat Key, FL 34228.
Item 27
Principal Underwriters
The only underwriter is Accrued Equities, Inc.. Its relationship and history
are described in the Prospectus. There are no other underwriting relationships.
The President and majority shareholder of the underwriter is David J.
Schoenwald of 150 Broadhollow Road, Suite 306, Melville, NY 11747. He is also
the President of the Fund. The Vice President and minority shareholder of the
underwriter is Maurice L. Schoenwald of 5270 Gulf Of Mexico Drive Unit 503
Longboat Key, FL 34228. He is Secretary of the Fund and Chairman of the Board
of Directors of the Fund. The underwriting is on a "best efforts" basis only.
Checks for the purchase of securities by the investors shall be made payable
directly to the Fund. The role of the Underwriter is to organize, finance,
manage, advertise, promote, provide clerical and administrative services, to
act as investment manager and to develop and control relationships with
broker/dealer when and if they arise.
The Fund will pay the Underwriter as described in the Prospectus. As sales
agreements are executed with other licensed and qualified broker/dealers,
payments to them will be deducted from the payments due to Accrued Equities,
Inc.
There are no fees, commissions earnings pats or future not fully describes in
the Prospectus.
Item 28
Location of Accounts and Records
All books and records required will be in the care of David J. Schoenwald,
President of the Fund, or Maurice Schoenwald, Secretary of the Fund at 150
Broadhollow Road, Suite 306 Melville, NY 11747, except those within possession
of the Custodian and Transfer Agent described in the Prospectus.
Certain accounting records are maintained at the offices of First Data Investor
Services Group, Inc.. Records concerning shareholders' accounts are maintained
by the Fund's Transfer Agent, First Data Investor Services Group, Inc. 211
South Gulph Road, PO BOX 61503, King of Prussia, PA 19406. Records covering
portfolio transactions are maintained by the Fund's Custodian, United Missouri
Bank, 928 Grand Avenue, Kansas City, MO 64141, First Data Investor Services
Group, Inc. and by the Fund.
Item 29
Management Services
There is no management service contract excepting those services described in
the Prospectus and Statement of Additional Information.
<PAGE>
Item 30
Undertakings
As reflected in the Prospectus, the Fund undertakes to provide each person to
whom a prospectus is delivered with a copy of the Fund's latest annual report
to shareholders, upon request and without charge.
<PAGE>
Kenneth D Katz
Certified Public Accountant
64 North Park Avenue
Rockville Centre, NY 11570
REPORT AND CONSENT OF INDEPENDENT ACCOUNTANT
To the Shareowners and Directors
of
New Alternatives Fund, Inc.
With reference to the Registration Statement (Form N-lA) of New Alternatives
Fund, Inc., I hereby consent to the use of my report dated January 25, 1999 for
the period ending December 31, 1998 appearing in the Prospectus, constituting a
part of such registration statement, when such report is accompanied by the
financial statements referred to therein. I also consent to the reference to
myself in the Prospectus.
The examination referred to in the above mentioned report included an
examination of the supporting statements of this Registration Statement and, in
my opinion, such supporting statements presents fairly the information required
to be set forth therein in conformity with generally accepted accounting
principles.
/S/_________________________________
KENNETH D. KATZ, C.P.A.
Rockville Centre, New York
March 2,1999
<PAGE>
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Act of l940, the Registrant has caused this post-effective amendment to the
Registration Statement to be signed on its behalf by the undersigned, hereunto
duly authorized in the Village of Melville, of the State of New York, on the
2nd day of March 1998.
NEW ALTERNATIVES FUND, INC.
BY: /S/
David J Schoenwald
Pursuant to the requirements of the Securities Act of l933 and the Investment
Act of l940, the Registration Statement has been signed below by the following
persons in their capacities and on the dates indicated.
SIGNATURES TITLE DATE
---------- ----- ----
/S/__________________ President, Director 3/02/98 David J Schoenwald
David J Schoenwald
/S/__________________ Vice President, 3/02/98 Maurice L Schoenwald
Maurice L Schoenwald Director (Chairman)
<PAGE>
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Act of 1940, the Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
SIGNATURES TITLE DATE
---------- ----- ----
/S/ President and 3/02/98
- ------------------------ Director -------
David J. Schoenwald
/S/ Vice President,Secre- 3/02/98
- ----------------------- tary, Treasurer and -------
Maurice L. Schoenwald Director
*/S/ Director 3/02/98
- ---------------------- -------
Arthur Kaplan
*/S/ Director 3/02/98
- ---------------------- -------
Sharon Reier
*/S/ Director 3/02/98
- ---------------------- -------
Dorothy Wayner
*/S/ Director 3/02/98
- ---------------------- -------
Dudley Clayton
*/S/ Director 3/02/98
- ---------------------- -------
Lena Clayton
*/S/ Director 3/02/98
- ---------------------- -------
Daniel Wolfson
* By Maurice L. Schoenwald as Attorney in Fact.
