Calvert Social Investment Fund
Technology Portfolio
Prospectus
October 31, 2000
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PROSPECTUS
October 31, 2000
CALVERT SOCIAL INVESTMENT FUND - TECHNOLOGY PORTFOLIO
About the Fund
2 Investment Objective and Strategy
3 Fees and Expenses
5 Investment Practices and Risks
9 Investment Selection Process and Socially Responsible Investment Criteria
11 Shareholder Advocacy and Social Responsibility
About Your Investment
12 About Calvert
12 Advisory Fees
13 How to Buy Shares
13 Getting Started
13 Choosing a Share Class
16 Calculation of CDSC/Waiver
17 Distribution and Service Fees
17 Account Application
18 Important - How Shares are Priced
18 When Your Account Will be Credited
19 Other Calvert Group Features
(Exchanges, Minimum Account Balance, etc.)
21 Dividends, Capital Gains and Taxes
23 How to Sell Shares
25 Exhibit A- Reduced Sales Charges (Class A)
27 Exhibit B- Service Fees and
Other Arrangements with Dealers
These securities have not been approved or disapproved by the Securities and
Exchange Commission (SEC) or any State Securities Commission, nor has the SEC or
any State Securities Commission passed on the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
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Objective
Calvert Social Investment Fund Technology Portfolio seeks growth of capital
through investment in stocks in companies involved in the development,
advancement, and use of technology.
Principal Investment Strategies
The Fund invests primarily in stocks of companies that develop new technologies
and that may experience exceptional growth in sales and earnings driven by
technology-related products and services. These companies may include companies
that develop, produce or distribute products or services in the computer,
semiconductors, electronics, communications, healthcare and biotechnology
sectors.
The Fund will invest at least 65% of its assets in the stocks of U.S. and
non-U.S. companies principally engaged in research, development, and manufacture
of technology and in the stocks of companies that should benefit from the
commercialization of technological advances. The Fund may also invest up to 10%
in private equity (the investments are generally venture capital investments in
small untried enterprises that are not traded on a public exchange) and short at
least 10% of the net asset value.
The goal of the investment selection process is to identify candidates for
investment that are growth companies with superior earnings prospects,
reasonable valuations, and favorable trading volume and price patterns. The
process is based on one philosophy: earnings expectations drive stock prices.
The Fund invests in companies with strong earnings prospects that the advisor
expects to produce gains over time. Investments are selected on the basis of
their ability to contribute to the dual objectives of financial soundness and
social criteria. The Fund buys companies with strong earnings dynamics, and
sells those with deteriorating earnings prospects. Security selection is the
primary means of adding investment value. The Fund uses an active trading
strategy which may cause the Fund to have a relatively high amount of short-term
capital gains, which are taxable to you, the shareholder, at the ordinary income
tax rate.
The Fund invests with the philosophy that long-term rewards to investors will
come from those organizations whose products, services, and methods enhance the
human condition and the traditional American values of individual initiative,
equality of opportunity and cooperative effort.
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Principal Risks
The Fund is designed for long-term investors who are willing to accept
above-average risk and volatility in order to seek a higher rate of return over
time. You could lose money on your investment in the Fund, or the Fund could
underperform for any of the following reasons:
- The technology sector involves special risks, such as the faster rate of
change and obsolescence of technological advances, and has been among the most
volatile sectors of the stock market. The Fund's share price is likely to be
more volatile than other funds that do not concentrate in one market sector.
- The individual stocks in the Fund do not perform as well as expected.
- The Fund is subject to the risk that its principal market segment,
technology stocks, may underperform compared to other market segments or to the
equity markets as a whole.
- The Fund is non-diversified. Compared to other funds, the Fund may invest
more of its assets in a smaller number of companies. Gains or losses on a single
stock may have a positive or negative impact on the Fund.
An investment in the Fund is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency.
(No performance results are shown for the Fund since it has been in existence
for less than one calendar year.)
FEES AND EXPENSES
This table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund.
Class A Class B Class C
Shareholder fees
(paid directly from your account)
Maximum sales charge (load)
imposed on purchases 4.75% None None
(as a percentage of offering price)
Maximum deferred sales charge (load)
(as a percentage of purchase or None2 5.00% 3 1.00%4
redemption proceeds, whichever is lower)
Annual fund operating expenses1
(deducted from Fund assets)
Management fees 1.50% 1.50% 1.50%
Distribution and service (12b-1) fees .25% 1.00% 1.00%
Other expenses .67% .96% .96%
Total annual fund operating expenses 2.42% 3.46% 3.46%
Fee waiver and/or expense reimbursement5 .32% .36% .36%
Net expenses 2.10% 3.10% 3.10%
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Notes to Fees and Expenses Table
1 Expenses are based on estimates for the Fund's current fiscal year.
Management fees include the Subadvisory fees paid by the Advisor, Calvert
Asset Management Company ("CAMCO" or "Calvert") to the Subadvisor, and
the administrative fee paid by the Fund to Calvert Administrative
Services Company, an affiliate of CAMCO.
2 Purchases of Class A shares for accounts with $1 million or more are not
subject to front-end sales charges, but may be subject to a 1% contingent
deferred sales charge on shares redeemed within 1 year of purchase.
(See "How to Buy Shares" - Class A.)
3 A contingent deferred sales charge is imposed on the proceeds of Class B
shares redeemed within 6 years, subject to certain exceptions. The charge is a
percentage of net asset value at the time of purchase or redemption,
whichever is less, and declines from 5% in the first year that shares are held,
to 4% in the second and third year, 3% in the fourth year, 2% in the fifth
year, and 1% in the sixth year. There is no charge on redemptions of Class B
shares held for more than six years. See "Calculation of Contingent Deferred
Sales Charge."
4 A contingent deferred sales charge of 1% is imposed on the proceeds of
Class C shares redeemed within one year. The charge is a percentage of net
asset value at the time of purchase or redemption, whichever is less. See
"Calculation of Contingent Deferred Sales Charge."
5 CAMCO has agreed to limit annual fund operating expenses (net of any
expense offset arrangements) through January 31, 2002. The contractual expense
cap is shown as "Net expenses," this is the maximum amount of operating expenses
that may be charged to the Fund through January 31, 2002. For the purposes of
this expense limit, operating expenses do not include interest expense,
brokerage commissions, extraordinary expenses, taxes and capital items. The Fund
has an offset arrangement with the custodian bank whereby the custodian and
transfer agent fees may be paid indirectly by credits on the Fund's uninvested
cash balances. These credits are used to reduce the Fund's expenses.
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Example
This example is 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 in the Fund for the time periods indicated;
- Your investment has a 5% return each year; and
- The Fund's operating expenses remain the same.
Although your actual costs may be higher or lower, under these assumptions your
costs would be:
Class Number of Years Investment is Held
1 Year 3 Years
A (no redemption) $678 $1,165
B (with redemption) 813 1,429
B (no redemption) 313 1,029
C (with redemption) 413 1,029
C (no redemption) 313 1,029
Investment Practices and Related Risks
On the following pages are brief descriptions of the principal investments and
techniques, summarized earlier, along with certain additional investment
techniques and their risks. For each of the investment practices listed,we show
the principal types of risk involved. (See the following pages for a description
of the types of risks).
Investment Practices
Stocks in General. The Fund is subject to stock market risk. Stock prices
overall may decline over short or even long periods. The Fund is also subject
to
investment style risk, which is the chance that returns from the technology
sector stocks will trail returns from other asset classes or the overall stock
market. Each type of stock tends to go through cycles of doing better or worse
than the stock market in general. Finally, individual stocks may lose value for
a variety of reasons, even when the overall stock market has increased. Risks:
Market.
Active Trading Strategy/Turnover involves selling a security soon after
purchase. An active trading strategy causes a fund to have higher portfolio
turnover compared to other funds and higher transaction costs, such as
commissions and custodian and settlement fees, and may increase your tax
liability. Risks: Opportunity, Market, Transaction and Tax.
Temporary Defensive Positions.
During adverse market, economic or political conditions, the Fund may depart
from its principal investment strategies by increasing its investment in
short-term interest-bearing securities. During times of any temporary defensive
positions, the Fund may not be able to achieve its investment objective Risks:
Opportunity.
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Conventional Securities
Foreign Securities. Securities issued by companies located outside the U.S.
and/or traded primarily on a foreign exchange. Risks: Market, Currency,
Transaction, Liquidity, Information and Political.
Small Cap Stocks. Investing in small companies involves greater risk than with
more established companies. Small cap stock prices are more volatile and the
companies often have limited product lines, markets, financial resources, and
management experience. Risks: Market, Liquidity and Information.
Investment grade bonds. Bonds rated BBB/Baa or higher or comparable unrated
bonds. Risks: Interest Rate, Market and Credit.
Below-investment grade bonds. Bonds rated below BBB/Baa or comparable unrated
bonds are considered junk bonds. They are subject to greater credit risk than
investment grade bonds. Such investments are permitted, but not typically used.
Risks: Credit, Market, Interest Rate, Liquidity and Information.
Unrated debt securities. Bonds that have not been rated by a recognized rating
agency; the Advisor has determined the credit quality based on its own research.
Risks: Credit, Market, Interest Rate, Liquidity and Information.
Illiquid securities. Securities which cannot be readily sold because there is no
active market. Risks: Liquidity, Market and Transaction.
Initial Public Offerings ("IPOs"). IPOs are newly issued securities that may
have volatile prices due to speculation and the lack of any established long
term price history. Accordingly, IPOs and other volatile investments may
magnify the performance impact when the Fund assets are small or when the Fund
contains a significant amount of such investments. Currently, there is no limit
on the amount of IPOs that may be purchased by the Fund provided such purchases
are within the Portfolio's stated objectives and guidelines. Portfolio
performance driven by IPO purchases may not continue if assets grow or IPO
Portfolio trading changes. Risks: Market.
Leveraged derivative instruments
Currency contracts. Contracts involving the right or obligation to buy or sell a
given amount of foreign currency at a specified price and future date. Risks:
Currency, Leverage, Correlation, Liquidity and Opportunity.
Options on securities and indices. Contracts giving the holder the right but not
the obligation to purchase or sell a security (or the cash value, in the case of
an option on an index) at a specified price within a specified time. In the case
of selling (writing) options, the Funds will write call options only if they
already own the security (if it is "covered"). Risks: Interest Rate, Currency,
Market, Leverage, Correlation, Liquidity, Credit and Opportunity.
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Futures contract. Agreement to buy or sell a specific amount of a commodity or
financial instrument at a particular price on a specific future date. Risks:
Interest Rate, Currency, Market, Leverage, Correlation, Liquidity and
Opportunity.
High Social Impact Investments
High Social Impact Investments is a program that targets a percentage of the
Fund's assets (up to 1%) to directly support the growth of community-based
organizations for the purposes of promoting business creation, housing
development, and economic and social development of urban and rural communities.
The Fund may engage in this program upon reaching $50 million in assets. These
types of investments offer a rate of return below the then-prevailing market
rate, and are considered illiquid, unrated and may be deemed below-investment
grade. They also involve a greater risk of default or price decline than
investment grade securities. However, they have significant social return by
making a difference in our local communities. High Social Impact Investments
are valued under the direction and control of the Fund's Board.
The Fund has received an exemptive order to permit it to invest those assets
allocated for investment in High Social Impact Investments through the purchase
of Community Investment Notes from the Calvert Social Investment Foundation. The
Calvert Social Investment Foundation is a non-profit organization, legally
distinct from Calvert Group, organized as a charitable and educational
foundation for the purpose of increasing public awareness and knowledge of the
concept of socially responsible investing. The Calvert Social Investment
Foundation has instituted the Calvert Community Investments program to raise
assets from individual and institutional investors and then invest these assets
directly in non-profit or not-for-profit community development organizations and
community development banks that focus on low income housing, economic
development and business development in urban and rural communities.
Special Equities
The Fund has a Special Equities investment program that allows the Fund to
promote especially promising approaches to social goals through privately placed
investments. The investments are generally venture capital investments in small,
untried enterprises. The Special Equities Committee of the Fund's Board
identifies, evaluates, and selects the Special Equities investments. Special
Equities involve a high degree of risk - they are subject to liquidity,
information, and, if a debt investment, credit risk. Special Equities are valued
under the direction and control of the Fund's Board.
The Fund has additional investment policies and restrictions (for example,
repurchase agreements, borrowing, pledging, and reverse repurchase agreements,
and securities lending.) These policies and restrictions are discussed in the
Statement of Additional Information ("SAI ").
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Types of Investment Risk
Correlation risk
This occurs when a Fund "hedges"- uses one investment to offset the Fund's
position in another. If the two investments do not behave in relation to one
another the way Fund managers expect them to, then unexpected or undesired
results may occur. For example, a hedge may eliminate or reduce gains as well as
offset losses.
Credit risk
The risk that the issuer of a security or the counterparty to an investment
contract may default or become unable to pay its obligations when due.
Currency risk
Currency risk occurs when a Fund buys, sells or holds a security denominated in
foreign currency. Foreign currencies "float" in value against the U.S. dollar.
Adverse changes in foreign currency values and currency controls imposed by
foreign markets can cause investment losses when a Fund's investments are
converted to U.S. dollars.
Information risk
The risk that information about a security or issuer or the market might not be
available, complete, accurate or comparable.
Interest rate risk
The risk that changes in interest rates will adversely affect the value of an
investor's securities. When interest rates rise, the value of fixed-income
securities will generally fall. Conversely, a drop in interest rates will
generally cause an increase in the value of fixed-income securities. Longer-term
securities and zero coupon/"stripped" coupon securities ("strips") are subject
to greater interest rate risk.
Leverage risk
The risk that occurs in some securities or techniques which tend to magnify the
effect of small changes in an index or a market. This can result in a loss that
exceeds the amount actually invested.
Liquidity risk
The risk that occurs when investments cannot be readily sold. A Fund may have to
accept a less-than-desirable price to complete the sale of an illiquid security
or may not be able to sell it at all.
Management risk
The risk that a Fund's portfolio management practices might not work to achieve
their desired result.
Market risk
The risk that securities prices in a market, a sector or an industry will
fluctuate, and that such movements might reduce an investment's value.
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Opportunity risk
The risk of missing out on an investment opportunity because the assets needed
to take advantage of it are committed to less advantageous investments or
strategies.
Political risk
The risk that may occur with foreign investments, and means that the value of an
investment may be adversely affected by nationalization, taxation, war,
government instability or other economic or political actions or factors.
Transaction risk
The risk that a Fund may be delayed or unable to settle a transaction or that
commissions and settlement expenses may be higher than usual.
Volatility risk
The risk that the value of a security will increase or decrease greatly within a
short period of time.
Investment Selection Process
Investments are selected on the basis of their ability to contribute to the dual
objectives of financial soundness (a potential company's ability to realize and
grow earnings) and social criteria.
Potential investments for the Fund are first selected for financial soundness
and then evaluated according to the Fund's social criteria. To the greatest
extent possible, the Fund seeks to invest in companies that exhibit positive
accomplishments with respect to one or more of the social criteria. Investments
for the Fund must meet the minimum standards for all its financial and social
criteria.
Although the Fund's social criteria tend to limit the availability of investment
opportunities more than is customary with other investment companies, CAMCO and
the Subadvisor of the Fund believe there are sufficient investment opportunities
to permit full investment among issuers which satisfy the Fund's investment and
social objectives.
The selection of an investment by the Fund does not constitute endorsement or
validation by the Fund, nor does the exclusion of an investment necessarily
reflect failure to satisfy the Fund's social criteria. Investors are invited to
send a brief description of companies they believe might be suitable for
investment.
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Socially Responsible Investment Criteria
The Fund invests in accordance with the philosophy that long-term rewards to
investors will come from those organizations whose products, services, and
methods enhance the human condition and the traditional American values of
individual initiative, equality of opportunity and cooperative effort. In
addition, we believe that there are long-term benefits in an investment
philosophy that demonstrates concern for the environment, labor relations, human
rights and community relations. Those enterprises that exhibit a social
awareness in these issues should be better prepared to meet future societal
needs. By responding to social concerns, these enterprises should not only
avoid the liability that may be incurred when a product or service is determined
to have a negative social impact or has outlived its usefulness, but also be
better positioned to develop opportunities to make a profitable contribution to
society. These enterprises should be ready to respond to external demands and
ensure that over the longer term they will be viable to seek to provide a
positive return to both investors and society as a whole.
The Fund has developed social investment criteria, detailed below. These
criteria represent standards of behavior which few, if any, organizations
totally satisfy. As a matter of practice, evaluation of a particular
organization in the context of these criteria will involve subjective judgment
by CAMCO and the Subadvisor. All social criteria may be changed by the Board of
Trustees without shareholder approval.
The Fund seeks to invest in companies that:
- Deliver safe products and services in ways that sustain our natural
environment. For example, the Fund looks for companies that produce energy from
renewable resources, while avoiding consistent polluters.
- Manage with participation throughout the organization in defining and
achieving objectives. For example, the Fund looks for companies that offer
employee stock ownership or profit-sharing plans.
- Negotiate fairly with their workers, provide an environment supportive of
their wellness, do not discriminate on the basis of race, gender, religion, age,
disability, ethnic origin, or sexual orientation, do not consistently violate
regulations of the EEOC, and provide opportunities for women, disadvantaged
minorities, and others for whom equal opportunities have often been denied. For
example, the Fund considers both unionized and non-union firms with good labor
relations.
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- Foster awareness of a commitment to human goals, such as creativity,
productivity, self-respect and responsibility, within the organization and the
world, and continually recreates a context within which these goals can be
realized. For example, the Fund looks for companies with an above average
commitment to community affairs and charitable giving.
The Fund will not invest in companies that the Advisor determines to be
significantly engaged in:
- Business activities in support of repressive regimes
- Production, or the manufacture of equipment, to produce nuclear energy
- Manufacture of weapon systems
- Manufacture of alcoholic beverages or tobacco products
- Operation of gambling casinos
- A pattern and practice of violating the rights of indigenous people. We
urge companies to end negative stereotypes of Native Americans and other
indigenous peoples. For example, the Fund objects to the unauthorized use of
names and images that portray Native Americans in a negative light, and
supports the promotion of positive portrayals of all individuals and ethnic
groups.
With respect to U.S. government securities, the Fund invests primarily in debt
obligations issued or guaranteed by agencies or instrumentalities of the U.S.
Government whose purposes further or are compatible with the Fund's social
criteria, such as obligations of the Student Loan Marketing Association, rather
than general obligations of the U.S. Government, such as Treasury securities.
Shareholder Advocacy and Social Responsibility
Calvert takes a proactive role to make a tangible positive contribution to our
society and that of future generations. We seek to positively influence
corporate behavior through the Fund's role as shareholder by pushing companies
toward higher standards of social and environmental responsibility. Our
activities may include but are not limited to:
Dialogue with companies
We regularly initiate dialogue with management as part of our social research
process. After we've become a shareholder, we often continue our dialogue with
management through phone calls, letters and in-person meetings. Through our
interaction, we learn about management's successes and challenges and press for
improvement on issues of concern.
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Proxy voting
As a shareholder in our various portfolio companies, the Fund is guaranteed an
opportunity each year to express its views on issues of corporate governance and
social responsibility at annual stockholder meetings. We take our voting
responsibility seriously and vote all proxies consistent with the financial and
social objectives of the Fund.
Shareholder resolutions
Calvert proposes resolutions on a variety of social issues. We file shareholder
resolutions when our dialogue with corporate management proves unsuccessful to
encourage a company to take action. In most cases, our efforts have led to
negotiated settlements with positive results for shareholders and companies
alike. For example, one of our shareholder resolutions resulted in the company's
first-ever disclosure of its equal employment policies, programs and workforce
demographics.
About Calvert
Calvert Asset Management Company, Inc. (4550 Montgomery Avenue, Suite 1000N,
Bethesda, MD 20814) ("CAMCO" or "Calvert") is the Fund's investment advisor.
Calvert provides the Fund with investment supervision and management and office
space; furnishes executive and other personnel to the Fund; and pays the
salaries and fees of all Trustees who are employees of Calvert. It has been
managing mutual funds since 1976. Calvert is the investment advisor for over 25
mutual fund portfolios, including the first and largest family of socially
screened funds. As of December 31, 1999, Calvert had over $6.5 billion in
assets under management.
Subadvisor
Turner Investment Partners, Inc. (1235 Westlakes Drive, Berwyn, Pennsylvania
19312) has managed the Portfolio since inception. It uses a disciplined
approach to investing in growth stocks based on the premise that earnings
expectations drive stock prices.
Bob Turner is the founder, chairman, and chief investment officer of Turner
Investment Partners. He heads the Fund's portfolio management team. A
Chartered Financial Analyst, he was previously senior investment manager with
Meridian Investment Company.
The Fund has obtained an exemptive order from the Securities and Exchange
Commission to permit the Fund, pursuant to approval by the Board of Trustees, to
enter into and materially amend contracts with the Fund's Subadvisors without
shareholder approval. See "Investment Advisor and Subadvisor" in the SAI for
further details.
Advisory Fees
The Fund's advisory agreement provides for the Fund to pay CAMCO a fee of 1.25%
of the Fund's average daily net assets.
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HOW TO BUY SHARES
Getting Started - Before You Open an Account
You have a few decisions to make before you open an account in a mutual fund.
First, decide which fund or funds best suits your needs and your goals.
Second, decide what kind of account you want to open. Calvert offers individual,
joint, trust, Uniform Gifts/Transfers to Minor Accounts, Traditional, Education
and Roth IRAs, Qualified Profit-Sharing and Money Purchase Plans, SIMPLE IRAs,
SEP-IRAs, 403(b)(7) accounts, and several other types of accounts. Minimum
investments are lower for the retirement plans.
Then decide which class of shares is best for you.
You should make this decision carefully, based on:
- the amount you wish to invest;
- the length of time you plan to keep the investment; and
- the Class expenses.
Choosing a Share Class
This prospectus offers three different Classes (Class A, B, or C) of the Fund.
The chart on the following page shows the difference in the Classes and the
general types of investors who may be interested in each Class.
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Class A:
Front-End Sales
Charge
For all investors, particularly those investing a substantial amount who plan to
hold the shares for a long period of time.
Sales charge on each purchase of 4.75% or less, depending on the amount you
invest.
Class A shares have an annual 12b-1 fee of up to 0.25%.
Class A shares have lower annual expenses due to a lower 12b-1 fee.
Purchases of Class A shares at NAV for accounts with $1,000,000 or more will be
subject to a 1.0% deferred sales charge for 1 year.
Class B:
Deferred Sales
Charge for 6 years
For investors who plan to hold the shares at least 6 years. The expenses of this
class are higher than Class A, because of the 12b-1 fee.
No sales charge on each purchase, but if you sell your shares within 6 years,
you will pay a deferred sales charge of 5% or less on shares you sell.
Class B shares have an annual 12b-1 fee of 1.00%.
Your shares will automatically convert to Class A shares after 8 years, reducing
your future annual expenses.
If you are investing more than $250,000, you should consider investing in Class
A
or C.
Class C:
Deferred Sales
Charge for 1 year
For investors who are investing for at least one year, but less than six years.
The expenses of this Class are higher than Class A, because of the 12b-1 fee.
No sales charge on each purchase, but if you sell shares within 1 year, then you
will pay a deferred sales charge of 1% at that time.
Class C shares have an annual 12b-1 fee of 1.00%.
Class C shares have higher annual expenses than Class A and there is no
automatic conversion to Class A.
If you are investing more than $1,000,000, you should invest in Class A.
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Class A
If you choose Class A, you will pay a sales charge at the time of each purchase.
This table shows the charges both as a percentage of offering price and as a
percentage of the amount you invest. The term "offering price" means the NAV per
share plus the front-end sales charge. If you invest more, the percentage rate
of the sales charge will be lower. For example, if you invest more than $50,000,
or if your cumulative purchases or the value in your account is more than
$50,000,4 then the sales charge is reduced to 3.75%.
Your investment in Sales Charge % % of Amt.
Class A shares of offering price Invested
Less than $50,000 4.75% 4.99%
$50,000 but less than $100,000 3.75% 3.90%
$100,000 but less than $250,000 2.75% 2.83%
$250,000 but less than $500,000 1.75% 1.78%
$500,000 but less than $1,000,000 1.00% 1.01%
$1,000,000 and over None* None*
4 This is called "Rights of Accumulation." The sales charge is calculated by
taking into account not only the dollar amount of the new purchase of shares,
but also the higher of cost or current value of shares you have previously
purchased in Calvert Group Funds that impose sales charges. This automatically
applies to your account for each new purchase of Class A shares.
* Purchases of Class A shares at NAV for accounts with $1,000,000 or more
are subject to a one year CDSC of 1.00%. See the "Calculation of Contingent
Deferred Sales Charge and Waiver of Sales Charges."
The Class A front-end sales charge may be waived for certain purchases or
investors, such as participants in certain group retirement plans or other
qualified groups and clients of registered investment advisers. For details on
these and other purchases that may qualify for a reduced sales charge, see
Exhibit A.
Class B
If you choose Class B, there is no front-end sales charge like Class A, but if
you sell the shares within the first 6 years, you will have to pay a "contingent
deferred" sales charge ("CDSC"). Keep in mind that the longer you hold the
shares, the less you will have to pay in deferred sales charges.
Time Since Purchase CDSC %
1st year 5%
2nd year 4%
3rd year 4%
4th year 3%
5th year 2%
6th year 1%
After 6 years None
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Calculation of Contingent Deferred Sales Charge and Waiver of Sales Charges
The CDSC will not be charged on shares you received as dividends or from capital
gains distributions or on any capital appreciation (gain in the value) of shares
that are sold.
Shares that are not subject to the CDSC will be redeemed first, followed by
shares you have held the longest. The CDSC is calculated by determining the
share value at both the time of purchase and redemption and then multiplying
whichever value is less by the percentage that applies as shown above. If you
choose to sell only part of your shares, the capital appreciation for those
shares only is included in the calculation, rather than the capital appreciation
for the entire account.
The CDSC on Class B Shares will be waived in the following circumstances:
- Redemption upon the death or disability of the shareholder, plan
participant, or beneficiary.1
- Minimum required distributions from retirement plan accounts for
shareholders 70 1/2 and older.2
- The return of an excess contribution or deferral amounts, pursuant to
sections 408(d)(4) or (5), 401(k)(8), 402(g)(2), or 401(m)(6) of the Internal
Revenue Code.
- Involuntary redemptions of accounts under procedures set forth by the
Fund's Board of Trustees/Directors.
- A single annual withdrawal under a systematic withdrawal plan of up to 10%
of the shareholder's account balance.3
1 "Disability" means a total disability as evidenced by a determination by
the federal Social Security Administration.
2 The maximum amount subject to this waiver is based only upon the
shareholder's Calvert Group retirement accounts.
3 This systematic withdrawal plan requires a minimum account balance of
$50,000 to be established.
Class C
If you choose Class C, there is no front-end sales charge like Class A, but if
you sell the shares within the first year, you will have to pay a 1% CDSC. Class
C may be a good choice for you if you plan to buy shares and hold them for at
least 1 year, but not more than five or six years.
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Distribution and Service Fees
The Fund has adopted a plan under Rule 12b-1 of the Investment Company Act of
1940 that allows the Fund to pay distribution fees for the sale and distribution
of its shares. The distribution plan also pays service fees to persons (such as
your financial professional) for services provided to shareholders. Because
these fees are paid out of a Fund's assets on an ongoing basis, over time, these
fees will increase the cost of your investment and may cost you more than paying
other types of sales charges. Please see Exhibit B for more service fee
information.
The table below shows the maximum annual percentage payable under the
distribution plan. The fees are based on average daily net assets of the
particular Class.
Maximum Payable under Plan
Class A Class B Class C
0.25% 1.00% 1.00%
NEXT STEP - ACCOUNT APPLICATION
Complete and sign an application for each new account. Please specify which
class you wish to purchase. For more information, contact your financial
professional or our sales department at 800-368-2748.
Minimum To Open an Account Minimum additional investments
-$2,000 $250
Please make your check payable
to the Fund and mail it to Calvert's transfer agent at:
New Accounts Subsequent Investments
(include application): (include investment slip):
Calvert Group Calvert Group
P.O. Box 219544 P.O. Box 219739
Kansas, City MO Kansas City, MO
64121-9544 64121-9739
By Registered, Calvert Group
Certified, or c/o NFDS,
Overnight Mail 330 West 9th St.
Kansas City, MO 64105-1807
<PAGE>
IMPORTANT - HOW SHARES ARE PRICED
The price of shares is based on the Fund's net asset value ("NAV"). NAV is
computed by adding the value of the Fund's holdings plus other assets,
subtracting liabilities, and then dividing the result by the number of shares
outstanding. The NAV of each class will be different, depending on the number of
shares outstanding for each class.
Portfolio securities and other assets are valued based on market quotations,
except that securities maturing within 60 days are valued at amortized cost. If
market quotations are not readily available, securities are valued by a method
that the Fund's Board of Trustees believes accurately reflects fair value.
The NAV is calculated as of the close of each business day, which coincides with
the closing of the regular session of the New York Stock Exchange ("NYSE")
(normally 4 p.m. ET). The Fund is open for business each day the NYSE is open.
Please note that there are some federal holidays, however, such as Columbus Day
and Veterans' Day, when the NYSE is open and the Fund is open but purchases
cannot be received because the banks and post offices are closed.
The Fund may hold securities that are primarily listed on foreign exchanges that
trade on days when the NYSE is closed. The Fund does not price shares on days
when the NYSE is closed, even if foreign markets may be open. As a result, the
value of the Fund's shares may change on days when you will not be able to buy
or sell your shares.
WHEN YOUR ACCOUNT WILL BE CREDITED
Your purchase will be processed at the NAV next calculated after your order is
received by the transfer agent in Kansas City, MO (see addresses on preceding
page). All of your purchases must be made in US dollars and indicate the Fund
and Class. No cash will be accepted or third party checks will be accepted. No
credit card or credit loan checks will be accepted. The Fund reserves the right
to suspend the offering of shares for a period of time or to reject any specific
purchase order. Any check purchase received without an investment slip may cause
delayed crediting. Any purchase less than $250 minimum for subsequent
investments will be charged a fee of $5 payable to the Fund. If your check does
not clear your bank, your purchase will be canceled and you will be charged a
$25 fee plus any costs incurred. All purchases will be confirmed and credited to
your account in full and fractional shares (rounded to the nearest 1/1000th of a
share).
<PAGE>
OTHER CALVERT GROUP FEATURES
Calvert Information Network
For 24 hour performance and account information call 800-368-2745 or visit
www.calvert.com
You can obtain current performance and pricing information, verify account
balances, and authorize certain transactions with the convenience of one phone
call, 24 hours a day.
Account Services
By signing up for services when you open your account, you avoid having to
obtain a signature guarantee. If you wish to add services at a later date, a
signature guarantee to verify your signature may be obtained from any bank,
trust company and savings and loan association, credit union, broker-dealer firm
or member of a domestic stock exchange. A notary public cannot provide a
signature guarantee.
Calvert Money Controller
Calvert Money Controller allows you to purchase or sell shares by electronic
funds transfer without the time delay of mailing a check or the added expense of
a wire. Use this service to transfer up to $300,000 electronically. Allow one or
two business days after you place your request for the transfer to take place.
Money transferred to purchase new shares may be subject to a hold of up to 10
business days before redemption requests will be honored. Transaction requests
must be received by 4 p.m. ET to receive that day's price. You may request this
service on your initial account application. Calvert Money Controller
transactions returned by your bank will incur a $25 charge.
Telephone Transactions
You may purchase, redeem, exchange shares, wire funds and use Calvert Money
Controller by telephone if you have pre-authorized service instructions and
established bank instructions on your account, when opened or at a later date by
a signature guaranteed letter . You receive telephone privileges automatically
when you open your account unless you instruct us otherwise in writing While
telephone redemption is easy and convenient, this account feature involves a
risk of loss from unauthorized or fraudulent transactions. Calvert will take
reasonable precautions to protect your account from fraud. You should do the
same by keeping your account information private and immediately reviewing any
confirmations or account statements that we send you. Make sure to contact
Calvert immediately about any transaction you believe to be unauthorized.
We reserve the right to refuse a telephone redemption if the caller is unable to
provide:
- The account number.
- The name and address exactly as registered on the account.
- The primary Social Security or employer identification number as
registered on the account.
<PAGE>
Please note that Calvert will not be responsible for any account losses due to
telephone fraud, so long as we have taken reasonable steps to verify the
caller's identity. If you wish to remove the telephone redemption feature from
your account, please notify us in writing.
Exchanges
Calvert Group offers a wide variety of investment options that includes common
stock funds, tax-exempt and corporate bond funds, and money market funds (call
your broker or Calvert representative for more information). We make it easy for
you to purchase shares in other Calvert funds if your investment goals change.
The exchange privilege offers flexibility by allowing you to exchange shares on
which you have already paid a sales charge from one Calvert mutual fund to
another at no additional charge.
Complete and sign an account application, taking care to register your new
account in the same name and taxpayer identification number as your existing
Calvert account(s). Exchange instructions may then be given by telephone if
telephone redemptions have been authorized and the shares are not in certificate
form.
Before you make an exchange, please note the following:
Each exchange represents the sale of shares of one Fund and the purchase of
shares of another. Therefore, you could realize a taxable gain or loss.
You may exchange shares acquired by reinvestment of dividends or distributions
into another Calvert Fund at no additional charge.
Shares may only be exchanged for shares of the same class of another Calvert
Fund.
No CDSC is imposed on exchanges of shares subject to a CDSC at the time of the
exchange. The applicable CDSC is imposed at the time the shares acquired by the
exchange are redeemed.
Bank Holidays: On any day Calvert is open but the Fund's custodian bank is
closed (e.g., Columbus Day and Veteran's Day) exchange requests into or out of a
money market fund will be priced at the next determined NAV, but will not
receive any dividend in the money market fund until the next day the Fund's
custodian bank is open.
The Fund and the distributor reserve the right at any time to reject or cancel
any part of any purchase or exchange order; modify any terms or conditions of
purchase of shares of any Fund; or withdraw all or any part of the offering made
by this prospectus. To protect the interests of investors, each Fund and the
distributor may reject any order considered to be market-timing activity (the
purchase and sale of securities based on short-term price patterns as well as on
asset values).
The Fund reserves the right to terminate or modify the exchange privilege with
60 days' written notice.
<PAGE>
Electronic Delivery of Prospectuses and Shareholder Reports
You may request to receive electronic delivery of prospectuses and annual and
semi annual reports.
Combined General Mailings (Householding)
Multiple accounts with the same social security number will receive one mailing
per household of information such as prospectuses and semi-annual and annual
reports. You may request further grouping of accounts to receive fewer mailings.
Separate statements will be generated for each separate account and will be
mailed in one envelope for each combination above.
Special Services and Charges
The Fund pays for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account or a stop payment on a draft. You may be required to pay a fee for
these special services. If you are purchasing shares through a program of
services offered by a broker/dealer or financial institution, you should read
the program materials together with this Prospectus. Certain features may be
modified in these programs. Investors may be charged a fee if they effect
transactions in Fund shares through a financial intermediary.
Minimum Account Balance
Please maintain a balance in each of your Fund accounts of at least $1,000 per
class. If the balance in your account falls below the minimum during a month,
your account may be closed and the proceeds mailed to the address of record. You
will receive notice that your account is below the minimum (for any reason,
including a decline in the value of the Fund's shares), and will be closed if
the balance is not brought up to the required minimum within 30 days.
To protect investors, the Fund may reject certain small retirement plan accounts
where the accounting and transaction expenses would be a burden to other Fund
shareholders.
DIVIDENDS, CAPITAL GAINS AND TAXES
The Fund pays dividends from its net investment income annually. Net investment
income consists of interest income, net short-term capital gains, if any, and
dividends declared and paid on investments, less expenses. Distributions of net
short-term capital gains (treated as dividends for tax purposes) and net
long-term capital gains, if any, are normally paid once a year; however, the
Fund does not anticipate making any such distributions unless available capital
loss carryovers have been used or have expired. Dividend and distribution
payments will vary between classes.
<PAGE>
Dividend payment options
Dividends and any distributions are automatically reinvested in the same Fund at
NAV (without sales charge), unless you elect to have amounts of $10 or more paid
in cash (by check or by Calvert Money Controller). Dividends and distributions
from any Calvert Group Fund may be automatically invested in the same share
class of an identically registered account in the same share class of any other
Calvert Group Fund at NAV. If reinvested in the same account, new shares will be
purchased at NAV on the reinvestment date, which is generally 1 to 3 days prior
to the payment date. You must notify the Funds in writing to change your payment
options. If you elect to have dividends and/or distributions paid in cash, and
the US Postal Service returns the check as undeliverable, it, as well as future
dividends and distributions, will be reinvested in additional shares. No
dividends will accrue on amounts represented by uncashed distribution or
redemption checks.
Buying a Dividend
At the time of purchase, the share price of each class may reflect undistributed
income, capital gains or unrealized appreciation of securities. Any income or
capital gains from these amounts which are later distributed to you are fully
taxable. On the record date for a distribution, share value is reduced by the
amount of the distribution. If you buy shares just before the record date
("buying a dividend") you will pay the full price for the shares and then
receive a portion of the price back as a taxable distribution.
Federal Taxes
In January, the Fund will mail you Form 1099-DIV indicating the federal tax
status of dividends and any capital gain distributions paid to you during the
past year. Generally, dividends and distributions are taxable in the year they
are paid. However, any dividends and distributions paid in January but declared
during the prior three months are taxable in the year declared. Dividends and
distributions are taxable to you regardless of whether they are taken in cash or
reinvested. Dividends, including short-term capital gains, are taxable as
ordinary income. Distributions from long-term capital gains are taxable as
long-term capital gains, regardless of how long you have owned shares.
You may realize a capital gain or loss when you sell or exchange shares. This
capital gain or loss will be short- or long-term, depending on how long you have
owned the shares which were sold. In January, the Fund will mail you Form 1099-B
indicating the total amount of all sales, including exchanges. You should keep
your annual year-end account statements to determine the cost (basis) of the
shares to report on your tax returns.
Other Tax Information
In addition to federal taxes, you may be subject to state or local taxes on your
investment, depending on the laws in your area. You will be notified to the
extent, if any, that dividends reflect interest received from US government
securities. Such dividends may be exempt from certain state income taxes.
<PAGE>
Taxpayer Identification Number
If we do not have your correct Social Security or Taxpayer Identification Number
("TIN") and a signed certified application or Form W-9, Federal law requires us
to withhold 31% of your reportable dividends, and possibly 31% of certain
redemptions. In addition, you may be subject to a fine by the Internal Revenue
Service. You will also be prohibited from opening another account by exchange.
Calvert Group reserves the right to reject any new account or any purchase order
for failure to supply a certified TIN.
HOW TO SELL SHARES
You may redeem all or a portion of your shares on any day your Fund is open for
business, provided the amount requested is not on hold. When you purchase by
check or with Calvert Money Controller (electronic funds transfer), the purchase
may be on hold for up to 10 business days from the date of receipt. During the
hold period, redemptions proceeds will not be sent until the Transfer Agent is
reasonably satisfied that the purchase payment has been collected. Your shares
will be redeemed at the NAV next calculated (less any applicable CDSC) after
your redemption request is received by the transfer agent in good order (see
below). The proceeds will normally be sent to you on the next business day, but
if making immediate payment could adversely affect your Fund, it may take up to
seven (7) days to make payment. Calvert Money Controller redemptions generally
will be credited to your bank account by the second business day after your
phone call. The Fund has the right to redeem shares in assets other than cash
for redemption amounts exceeding, in any 90-day period, $250,000 or 1% of the
net asset value of the affected Fund, whichever is less. When the NYSE is closed
(or when trading is restricted) for any reason other than its customary weekend
or holiday closings, or under any emergency circumstances as determined by the
Securities and Exchange Commission, redemptions may be suspended or payment
dates postponed. Please note that there are some federal holidays, however, such
as Columbus Day and Veterans' Day, when the NYSE is open and the Fund is open
but redemptions cannot be mailed or wired because the post offices and banks are
closed.
Follow these suggestions to ensure timely processing of your redemption request:
By Telephone
You may redeem shares from your account by telephone and have your money mailed
to your address of record or electronically transferred or wired to a bank you
have previously authorized. A charge of $5 may be imposed on wire transfers of
less than $1,000. See "Other Calvert Group Features-Telephone Transactions."
Written Requests
Calvert Group, P.O. Box 219544, Kansas City, MO 64121-9544
Your letter should include your account number and fund and the number of shares
or the dollar amount you are redeeming. Please provide a daytime telephone
number, if possible, for us to call if we have questions. If the money is being
sent to a new bank, person, or address other than the address of record, your
letter must be signature guaranteed.
<PAGE>
Systematic Check Redemptions
If you maintain an account with a balance of $10,000 or more, you may have up to
two (2) redemption checks for a fixed amount sent to you on the 15th of the
month, simply by sending a letter with all information, including your account
number, and the dollar amount ($100 minimum). If you would like a regular check
mailed to another person or place, your letter must be signature guaranteed.
Unless they otherwise qualify for a waiver, Class B or Class C shares redeemed
by Systematic Check Redemption will be subject to the Contingent Deferred Sales
Charge.
Corporations and Associations
Your letter of instruction and corporate resolution should be signed by
person(s) authorized to act on the account, accompanied by signature
guarantee(s).
Trusts
Your letter of instruction should be signed by the Trustee(s) (as Trustee(s)),
with a signature guarantee. (If the Trustee's name is not registered on your
account, please provide a copy of the trust document, certified within the last
60 days.)
Through your Dealer
Your dealer must receive your request before the close of regular trading on the
NYSE to receive that day's NAV. Your dealer will be responsible for furnishing
all necessary documentation to Calvert Group and may charge you for services
provided.
Request in "Good Order"
All redemption requests must be received by the transfer agent in "good order."
This means that your request must include:
- The Fund name and account number
- The amount of the transaction (in dollars or shares).
- Signatures of all owners exactly as registered on the account (for mail
requests).
- Signature guarantees (if required).*
- Any supporting legal documentation that may be required.
- Any outstanding certificates representing shares to be redeemed.
*For instance, a signature guarantee must be provided by all registered account
shareholders when redemption proceeds are sent to a different person or address.
A signature guarantee can be obtained from most commercial and savings banks,
credit unions, trust companies, or member firms of a U.S. stock exchange. Please
note: Notarization is not the equivalent of a signature guarantee.
Transactions are processed at the next determined share price after the transfer
agent has received all required information.
<PAGE>
EXHIBIT A
REDUCED SALES CHARGES (CLASS A ONLY)
You may qualify for a reduced sales charge through several purchase plans
available. You must notify the Fund at the time of purchase to take advantage of
the reduced sales charge.
Rights of Accumulation can be applied to several accounts
Class A sales charge breakpoints are automatically calculated for each account
based on the higher of cost or current value of shares previously purchased.
This privilege can be applied to a family group or other qualified group* upon
request. Shares could then be purchased at the reduced sales charge which
applies to the entire group; that is, based on the higher of cost or current
value of shares previously purchased and currently held by all the members of
the group.
* A "qualified group" is one which:
1. has been in existence for more than six months, and
2. has a purpose other than acquiring shares at a discount, and
3. satisfies uniform criteria which enable CDI and brokers offering shares to
realize economies of scale in distributing such shares.
A qualified group must have more than 10 members, must be available to arrange
for group meetings between representatives of CDI or brokers distributing
shares, must agree to include sales and other materials related to the Funds in
its publications and mailings to members at reduced or no cost to CDI or
brokers. A pension plan is not a qualified group for rights of accumulation.
Letter of Intent
If you (or your group, as described above) plan to purchase $50,000 or more of
Calvert Fund shares over the next 13 months, your sales charge may be reduced
through a "Letter of Intent." You pay the lower sales charge applicable to the
total amount you plan to invest over the 13-month period, excluding any money
market fund purchases, instead of the higher 4.75% sales charge. Part of your
shares will be held in escrow, so that if you do not invest the amount
indicated, you will have to pay the sales charge applicable to the smaller
investment actually made. For more information, see the SAI.
Retirement Plans Under Section 457, Section 403(b)(7), or Section 401(k)
There is no sales charge on shares purchased for the benefit of a retirement
plan under section 457 of the Internal Revenue Code of 1986, as amended
("Code"), or for a plan qualifying under section 403(b) or 401(k) of the Code
if, at the time of purchase, (i) Calvert Group has been notified in writing that
the 403(b) or 401(k) plan has at least 200 eligible employees and is not
sponsored by a K-12 school district, or (ii) the cost or current value of shares
a 401(k) plan has in Calvert Group of Funds (except money market funds) is at
least $1 million.
Neither the Fund, nor Calvert Distributors, Inc. ("CDI"), nor any affiliate
thereof will reimburse a plan or participant for any sales charges paid prior to
receipt of
<PAGE>
such written communication and confirmation by Calvert Group. Plan
administrators should send requests for the waiver of sales charges based on the
above conditions to: Calvert Group Retirement Plans, 4550 Montgomery Avenue,
Suite 1000N, Bethesda, Maryland 20814.
Other Circumstances
There is no sales charge on shares of any Fund of the Calvert Group of Funds
sold to (i) current or retired Directors, Trustees, or Officers of the Calvert
Group of Funds, employees of Calvert Group, Ltd. and its affiliates, or their
family members; (ii) CSIF Advisory Council Members, directors, officers, and
employees of any subadvisor for the Calvert Group of Funds, employees of
broker/dealers distributing the Fund's shares and immediate family members of
the Council, subadvisor, or broker/dealer; (iii) Purchases made through a
Registered Investment Advisor; (iv) Trust departments of banks or savings
institutions for trust clients of such bank or institution, (v) Purchases
through a broker maintaining an omnibus account with the Fund, provided the
purchases are made by (a) investment advisors or financial planners placing
trades for their own accounts (or the accounts of their clients) and who charge
a management, consulting, or other fee for their services; or (b) clients of
such investment advisors or financial planners who place trades for their own
accounts if such accounts are linked to the master account of such investment
advisor or financial planner on the books and records of the broker or agent; or
(c) retirement and deferred compensation plans and trusts, including, but not
limited to, those defined in section 401(a) or section 403(b) of the I.R.C., and
"rabbi trusts."
Dividends and Capital Gain Distributions from other Calvert Group Funds
You may prearrange to have your dividends and capital gain distributions from
any Calvert Group Fund automatically invested in another account with no
additional sales charge.
Purchases made at NAV
Except for money market funds, if you make a purchase at NAV, you may exchange
that amount to another Calvert Group Fund at no additional sales charge.
Reinstatement Privilege
If you redeem shares and then within 60 days decide to reinvest in the same
Fund, you may do so at the net asset value next computed after the reinvestment
order is received, without a sales charge. You may use the reinstatement
privilege only once. The Fund reserves the right to modify or eliminate this
privilege.
<PAGE>
EXHIBIT B
SERVICE FEES AND ARRANGEMENTS WITH DEALERS
Calvert Distributors, Inc., the Fund's underwriter, pays dealers a commission,
or reallowance (expressed as a percentage of the offering price for Class A, and
a percentage of amount invested for Class B and C) when you purchase shares of
non-money market funds. CDI also pays dealers an ongoing service fee while you
own shares of that Fund (expressed as an annual percentage rate of average daily
net assets held in Calvert accounts by that dealer). The table below shows the
amount of payment which differs depending on the Class.
Maximum Commission/Service Fees
Class A Class B* Class C**
4.00%/0.25% 4.00%/0.25% 1.00%/1.00%
*Class B service fees begins to accrue in 13th month.
**Class C pays dealers a service fee of 0.25% and additional compensation of
0.75% for a total of 1.00%. Begins to accrue in 13th month.
Occasionally, CDI may reallow to dealers the full Class A front-end sales
charge. CDI may also pay additional concessions, including non-cash promotional
incentives, such as merchandise or trips, to brokers employing registered
representatives who have sold or are expected to sell a minimum dollar amount of
shares of the Funds and/or shares of other Funds underwritten by CDI. CDI may
make expense reimbursements for special training of a broker's registered
representatives, advertising or equipment, or to defray the expenses of sales
contests. CAMCO, CDI, or their affiliates may pay, from their own resources,
certain broker-dealers and/or other persons, for the sale and distribution of
the securities or for services to the Fund. These amounts may be significant.
Payments may include additional compensation beyond the regularly scheduled
rates, and finder's fees. CDI pays dealers a finder's fee on Class A shares
purchased at NAV in accounts with $1 million or more. The finder's fee is 1% of
the purchase NAV amount on the first $2 million, 0.80% on $2 to $3 million,
0.50% on $3 to $50 million, 0.25% on $50 to $100 million, and 0.15% over $100
million. All payments will be in compliance with the rules of the National
Association of Securities Dealers, Inc.
<PAGE>
To Open an Account:
800-368-2748
Performance and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
www.calvert.com
Service for Existing Accounts:
Shareholders 800-368-2745
Brokers 800-368-2746
TDD for Hearing-Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Registered, Certified or
Overnight Mail:
Calvert Group
c/o NFDS
330 West 9th Street
Kansas City, MO 64105
Calvert Group Web-Site
Address: http://www.calvert.com
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
<PAGE>
For investors who want more information about the Fund, the following documents
will be available, once filed, free upon request:
Annual/Semi-Annual Reports: Additional information about the Fund's investments
is available in the Fund's Annual and Semi-Annual reports to shareholders. In
the Fund's annual report, you will find a discussion of the market conditions
and investment strategies that significantly affected the Fund's performance
during its last fiscal year.
Statement of Additional Information (SAI): The SAI for the Fund provides more
detailed information about the Fund and is incorporated into this prospectus by
reference.
You can get free copies of reports and SAIs, request other information and
discuss your questions about the Fund by contacting your broker, or the Fund at:
Calvert Group
4550 Montgomery Ave, Suite 1000N
Bethesda, Md. 20814
Telephone: 1-800-368-2745
Calvert Group Web-Site
Address: http://www.calvert.com
You can review the Fund's report and SAI at the Public Reference Room of the
Securities and Exchange Commission. You can get text-only copies:
For a fee, by writing to or calling the Public Reference Room of the Commission,
Washington, D.C. 20549-0102, Telephone: 1-202-942-8090 or by electronic request
at the following E-mail address: [email protected]
Free from the Commission's Internet website at http://www.sec.gov.
Investment Company Act file: no. 811- 3334
<PAGE>
PROSPECTUS
October 31, 2000
Calvert Social Investment Fund - Technology Portfolio
Class I (Institutional) Shares
TABLE OF CONTENTS
About the Fund
Investment objective, strategy 1
Fees and Expenses 1
Investment Practices and Related Risks 2
High Social Impact Investments 3
Special Equities 4
Shareholder Advocacy and Social Responsibility 5
About Your Investment
Subadvisor 5
Advisory Fees 5
How to Open an Account 5
Important - How Shares are Priced 5
When Your Account Will be Credited 6
Other Calvert Group Features (Exchanges,
Minimum Account Balance, etc.) 6
Dividends, Capital Gains and Taxes 7
How to Sell Shares 7
These securities have not been approved or disapproved by the Securities and
Exchange Commission (SEC) or any State Securities Commission, nor has the SEC or
any State Securities Commission passed on the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
<PAGE>
Objective
The Fund seeks growth of capital through investment in stocks in companies
involved in the development, advancement, and use of technology.
Principal investment strategies
The Fund invests primarily in stocks of companies that develop new technologies
and that may experience exceptional growth in sales and earnings driven by
technology related products and services. These companies may include companies
that develop, produce or distribute products or services in the computer,
semiconductor, electronics, communications, heath care and biotechnology
sectors.
The Fund will invest at least 65% of its assets in the stocks of U.S. and
non-U.S. companies principally engaged in research, development, and manufacture
of technology and in the stocks of companies that should benefit from the
commercialization of technological advances. The Fund may also invest up to 10%
in private equity (the investments are generally venture capital investments in
small untried enterprises that are not traded on a public exchange) and short at
least 10% of the net asset value.
The goal of the investment selection process is to identify candidates for
investment that are growth companies with superior earnings prospects,
reasonable valuations, and favorable trading volume and price patterns. The
process is based on one philosophy: earnings expectations drive stock prices.
The Fund invests in companies with strong earnings prospects that the Subadvisor
expects to produce gains over time. Investments are selected on the basis of
their ability to contribute to the dual objectives of financial soundness and
social criteria. The Fund buys companies with strong earnings dynamics, and
sells those with deteriorating earnings prospects. Security selection is the
primary means of adding investment value. The Fund uses an active trading
strategy which may cause the Fund to have a relatively high amount of short-term
capital gains, which are taxable to you, the shareholder, at the ordinary income
tax rate.
The Fund invests with the philosophy that long-term rewards to investors will
come from those organizations whose products, services, and methods enhance the
human condition and the traditional American values of individual initiative,
equality of opportunity and cooperative effort.
Principal risks
The Fund is designed for long-term investors who are willing to accept
above-average risk and volatility in order to seek a higher rate of return over
time. You could lose money on your investment in the Fund, or the Fund could
underperform for any of the following reasons:
- The technology sector involves special risks, such as the faster rate of
change and obsolescence of technological advances, and has been among the most
volatile sectors of the stock market. The Fund's share price is likely to be
more volatile than other funds that do not concentrate in one market sector.
- The stock market goes down
- The individual stocks in the Fund do not perform as well as expected
- The Fund is subject to the risk that its principal market segment,
technology stocks, may underperform compared to other market segments or to the
equity markets as a whole
- The Fund is non-diversified. Compared to other funds, the Fund may invest
more of its assets in a smaller number of companies. Gains or losses on a single
stock may have greater impact on the Fund
An investment in the Fund is not a bank deposit and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency.
(No performance results are shown for the Fund since it has been in existence
for less than one calendar year.)
Fees and Expenses
This table describes the fees and expenses that you may pay if
you buy and hold shares of the Fund. Annual Fund operating
expenses are deducted from Fund assets.
Annual fund operating expenses1
(expenses deducted from Fund assets)
Management fees 1.30%
Distribution and service (12b-1) fees none
Other expenses .09%
Total annual fund operating expenses 1.39%
Fee waiver and/or expense reimbursement2 .04%
Net expenses 1.35%
1 Expenses are based on estimates for the Fund's current fiscal year.
Management fees include the Subadvisory fees paid by the Advisor, Calvert Asset
Management Company, Inc. ("CAMCO" or "Calvert") to the Subadvisor, and the
administrative fee paid by the Fund to Calvert Administrative Services Company,
an affiliate of CAMCO.
2 CAMCO has agreed to limit annual fund operating expenses (net of any
expense offset arrangements) through September 30, 2001. The contractual expense
cap is shown as "Net expenses," this is the maximum amount of operating expenses
that may be charged to the Fund through September 30, 2001. For the purposes of
this expense limit, operating expenses do not include interest expense,
brokerage commissions, extraordinary expenses, taxes and capital items. The Fund
has an offset arrangement with the custodian bank whereby the custodian and
transfer agent fees may be paid indirectly by credits on the Fund's uninvested
cash balances. These credits are used to reduce the Fund's expenses.
<PAGE>
Example
This example is intended to help you compare the cost of investing in a Fund
with the cost of investing in other mutual funds.
The example assumes that:
- You invest $1,000,000 in the Fund for the time periods
indicated;
- Your investment has a 5% return each year; and
- The Fund's operating expenses remain the same.
Although your actual costs may be higher or lower, under these assumptions your
costs would be as follows if the Class I shares are held for 1, or 3 years:
Number of Years Investment is Held
1 Year 3 Years
$13,746 43,611
Investment Practices and Related Risks
On the following pages are brief descriptions of the principal investments and
techniques, summarized earlier, along with certain additional investment
techniques and their risks. For each of the investment practices listed,we show
the principal types of risk involved. (See the following pages for a description
of the types of risks).
Investment Practices
Stocks in General. The Fund is subject to stock market risk. Stock prices
overall may decline over short or even long periods. The Fund is also subject to
investment style risk, which is the chance that returns from large and
mid-capitalization stocks will trail returns from other asset classes or the
overall stock market. Each type of stock tends to go through cycles of doing
better or worse than the stock market in general. Finally, individual stocks may
lose value for a variety of reasons, even when the overall stock market has
increased. Risks: Market.
Active Trading Strategy/Turnover involves selling a security soon after
purchase. An active trading strategy causes a fund to have higher portfolio
turnover compared to other funds and higher transaction costs, such as
commissions and custodian and settlement fees, and may increase your tax
liability. Risks: Opportunity, Market, Transaction and Tax.
Temporary Defensive Positions.
During adverse market, economic or political conditions, the Fund may depart
from its principal investment strategies by increasing its investment in
short-term interest-bearing securities. During times of any temporary defensive
positions, the Fund may not be able to achieve its investment objective Risks:
Opportunity.
Conventional Securities
Foreign Securities. Securities issued by companies located outside the U.S.
and/or traded primarily on a foreign exchange. Risks: Market, Currency,
Transaction, Liquidity, Information and Political.
Small Cap Stocks. Investing in small companies involves greater risk than with
more established companies. Small cap stock prices are more volatile and the
companies often have limited product lines, markets, financial resources, and
management experience. Risks: Market, Liquidity and Information.
Investment grade bonds. Bonds rated BBB/Baa or higher or comparable unrated
bonds. Risks: Interest Rate, Market and Credit.
Below-investment grade bonds. Bonds rated below BBB/Baa or comparable unrated
bonds are considered junk bonds. They are subject to greater credit risk than
investment grade bonds. Such investments are permitted, but not typically used.
Risks: Credit, Market, Interest Rate, Liquidity and Information.
Unrated debt securities. Bonds that have not been rated by a recognized rating
agency; the Advisor has determined the credit quality based on its own research.
Risks: Credit, Market, Interest Rate, Liquidity and Information.
Illiquid securities. Securities which cannot be readily sold because there is no
active market. Risks: Liquidity, Market and Transaction.
Initial Public Offerings ("IPOs"). IPOs are newly issued securities that may
have volatile prices due to speculation and the lack of any established long
term price history. Accordingly, IPOs and other volatile investments may
magnify the performance impact when the Fund assets are small or when the Fund
contains a significant amount of such investments. Currently, there is no limit
on the amount of IPOs that may be purchased by the Fund provided such purchases
are within the Portfolio's stated objectives and guidelines. Portfolio
performance driven by IPO purchases may not continue if assets grow or IPO
Portfolio trading changes. Risks: Market.
Leveraged derivative instruments
Currency contracts. Contracts involving the right or obligation to buy or sell a
given amount of foreign currency at a specified price and future date. Risks:
Currency, Leverage, Correlation, Liquidity and Opportunity.
Options on securities and indices. Contracts giving the holder the right but not
the obligation to purchase or sell a security (or the cash value, in the case of
an option on an index) at a specified price within a specified time. In the case
of selling (writing) options, the Funds will write call options only if they
already own the security (if it is "covered").
Risks: Interest Rate, Currency, Market, Leverage, Correlation, Liquidity, Credit
and Opportunity.
Futures contract. Agreement to buy or sell a specific amount of a commodity or
financial instrument at a particular price on a specific future date. Risks:
Interest Rate, Currency, Market, Leverage, Correlation, Liquidity and
Opportunity.
<PAGE>
High Social Impact Investments
High Social Impact Investments is a program that targets a percentage of the
Fund's assets (up to 1%) to directly support the growth of community-based
organizations for the purposes of promoting business creation, housing
development, and economic and social development of urban and rural communities.
The Fund may engage in this program upon reaching $50 million in assets. These
types of investments offer a rate of return below the then-prevailing market
rate, and are considered illiquid, unrated and may be deemed below-investment
grade. They also involve a greater risk of default or price decline than
investment grade securities. However, they have a significant social return by
making a difference in our local communities. High Social Impact Investments
are valued under the direction and control of the Fund's Board.
The Fund has received an exemptive order to permit it to invest those assets
allocated for investment in High Social Impact Investments through the purchase
of Community Investment Notes from the Calvert Social Investment Foundation. The
Calvert Social Investment Foundation is a non-profit organization, legally
distinct from Calvert Group, organized as a charitable and educational
foundation for the purpose of increasing public awareness and knowledge of the
concept of socially responsible investing. The Calvert Social Investment
Foundation has instituted the Calvert Community Investments program to raise
assets from individual and institutional investors and then invest these assets
directly in non-profit or not-for-profit community development organizations and
community development banks that focus on low income housing, economic
development and business development in urban and rural communities.
Special Equities
The Fund has a Special Equities investment program that allows the Fund to
promote especially promising approaches to social goals through privately placed
investments. The investments are generally venture capital investments in small,
untried enterprises. The Special Equities Committee of the Fund's Board
identifies, evaluates, and selects the Special Equities investments. Special
Equities involve a high degree of risk - they are subject to liquidity,
information, and, if a debt investment, credit risk. Special Equities are valued
under the direction and control of the Fund's Board.
The Fund has additional investment policies and restrictions (for example,
repurchase agreements, borrowing, pledging, and reverse repurchase agreements,
and securities lending.) These policies and restrictions are discussed in the
Statement of Additional Information ("SAI ").
Types of Investment Risk
Correlation risk
This occurs when a Fund "hedges"- uses one investment to offset the Fund's
position in another. If the two investments do not behave in relation to one
another the way Fund managers expect them to, then unexpected or undesired
results may occur. For example, a hedge may eliminate or reduce gains as well as
offset losses.
Credit risk
The risk that the issuer of a security or the counterparty to an investment
contract may default or become unable to pay its obligations when due.
Currency risk
Currency risk occurs when a Fund buys, sells or holds a security denominated in
foreign currency. Foreign currencies "float" in value against the U.S. dollar.
Adverse changes in foreign currency values and currency controls imposed by
foreign markets can cause investment losses when a Fund's investments are
converted to U.S. dollars.
Information risk
The risk that information about a security or issuer or the market might not be
available, complete, accurate or comparable.
Interest rate risk
The risk that changes in interest rates will adversely affect the value of an
investor's securities. When interest rates rise, the value of fixed-income
securities will generally fall. Conversely, a drop in interest rates will
generally cause an increase in the value of fixed-income securities. Longer-term
securities and zero coupon/"stripped" coupon securities ("strips") are subject
to greater interest rate risk.
Leverage risk
The risk that occurs in some securities or techniques which tend to magnify the
effect of small changes in an index or a market. This can result in a loss that
exceeds the amount actually invested.
Liquidity risk
The risk that occurs when investments cannot be readily sold. A Fund may have to
accept a less-than-desirable price to complete the sale of an illiquid security
or may not be able to sell it at all.
Management risk
The risk that a Fund's portfolio management practices might not work to achieve
their desired result.
Market risk
The risk that securities prices in a market, a sector or an industry will
fluctuate, and that such movements might reduce an investment's value.
Opportunity risk
The risk of missing out on an investment opportunity because the assets needed
to take advantage of it are committed to less advantageous investments or
strategies.
<PAGE>
Political risk
The risk that may occur with foreign investments, and means that the value of an
investment may be adversely affected by nationalization, taxation, war,
government instability or other economic or political actions or factors.
Transaction risk
The risk that a Fund may be delayed or unable to settle a transaction or that
commissions and settlement expenses may be higher than usual.
Investment Selection Process
Investments are selected on the basis of their ability to contribute to the dual
objectives of financial soundness (a potential company's ability to realize and
grow earnings) and social criteria.
Potential investments for the Fund are first selected for financial soundness
and then evaluated according to the Fund's social criteria. To the greatest
extent possible, the Fund seeks to invest in companies that exhibit positive
accomplishments with respect to one or more of the social criteria. Investments
for the Fund must meet the minimum standards for all its financial and social
criteria.
Although the Fund's social criteria tend to limit the availability of investment
opportunities more than is customary with other investment companies, CAMCO and
the Subadvisor of the Fund believe there are sufficient investment opportunities
to permit full investment among issuers which satisfy the Fund's investment and
social objectives.
The selection of an investment by the Fund does not constitute endorsement or
validation by the Fund, nor does the exclusion of an investment necessarily
reflect failure to satisfy the Fund's social criteria. Investors are invited to
send a brief description of companies they believe might be suitable for
investment.
Socially Responsible Investment Criteria
The Fund invests in accordance with the philosophy that long-term rewards to
investors will come from those organizations whose products, services, and
methods enhance the human condition and the traditional American values of
individual initiative, equality of opportunity and cooperative effort. In
addition, we believe that there are long-term benefits in an investment
philosophy that demonstrates concern for the environment, labor relations, human
rights and community relations. Those enterprises that exhibit a social
awareness in these issues should be better prepared to meet future societal
needs. By responding to social concerns, these enterprises should not only
avoid the liability that may be incurred when a product or service is determined
to have a negative social impact or has outlived its usefulness, but also be
better positioned to develop opportunities to make a profitable contribution to
society. These enterprises should be ready to respond to external demands and
ensure that over the longer term they will be viable to seek to provide a
positive return to both investors and society as a whole.
The Fund has developed social investment criteria, detailed below. These
criteria represent standards of behavior which few, if any, organizations
totally satisfy. As a matter of practice, evaluation of a particular
organization in the context of these criteria will involve subjective judgment
by CAMCO and the Subadvisor. All social criteria may be changed by the Board of
Trustees without shareholder approval.
The Fund seeks to invest in companies that:
- Deliver safe products and services in ways that sustain our natural
environment. For example, the Fund looks for companies that produce energy from
renewable resources, while avoiding consistent polluters.
- Manage with participation throughout the organization in defining and
achieving objectives. For example, the Fund looks for companies that offer
employee stock ownership or profit-sharing plans.
- Negotiate fairly with their workers, provide an environment supportive of
their wellness, do not discriminate on the basis of race, gender, religion, age,
disability, ethnic origin, or sexual orientation, do not consistently violate
regulations of the EEOC, and provide opportunities for women, disadvantaged
minorities, and others for whom equal opportunities have often been denied. For
example, the Fund considers both unionized and non-union firms with good labor
relations.
- Foster awareness of a commitment to human goals, such as creativity,
productivity, self-respect and responsibility, within the organization and the
world, and continually recreates a context within which these goals can be
realized. For example, the Fund looks for companies with an above average
commitment to community affairs and charitable giving.
The Fund will not invest in companies that the Advisor determines to be
significantly engaged in:
- Business activities in support of repressive regimes
- Production, or the manufacture of equipment, to produce nuclear energy
- Manufacture of weapon systems
- Manufacture of alcoholic beverages or tobacco products
- Operation of gambling casinos
- A pattern and practice of violating the rights of indigenous people. We
urge companies to end negative stereotypes of Native Americans and other
indigenous peoples. For example, the Fund objects to the unauthorized use of
names and images that portray Native Americans in a negative light, and supports
the promotion of positive portrayals of all individuals and ethnic groups.
<PAGE>
With respect to U.S. government securities, the Fund invests primarily in debt
obligations issued or guaranteed by agencies or instrumentalities of the U.S.
Government whose purposes further or are compatible with the Fund's social
criteria, such as obligations of the Student Loan Marketing Association, rather
than general obligations of the U.S. Government, such as Treasury securities.
Shareholder Advocacy and Social Responsibility
As the Fund's advisor, Calvert takes a proactive role to make a tangible
positive contribution to our society and that of future generations. We seek to
positively influence corporate behavior through our role as shareholders by
pushing companies toward higher standards of social and environmental
responsibility. Our activities may include but are not limited to:
Dialogue with companies
We regularly initiate dialogue with management as part of our social research
process. After the Fund becomes a shareholder, we often continue our dialogue
with management through phone calls, letters and in-person meetings. Through our
interaction, we learn about management's successes and challenges and press for
improvement on issues of concern.
Proxy voting
As a shareholder in our various portfolio companies, the Fund is guaranteed an
opportunity each year to express its views on issues of corporate governance and
social responsibility at annual stockholder meetings. We take our voting
responsibility seriously and vote all proxies consistent with the financial and
social objectives of our Fund.
Shareholder resolutions
Calvert proposes resolutions on a variety of social issues. We file shareholder
resolutions when our dialogue with corporate management proves unsuccessful to
encourage a company to take action. In most cases, our efforts have led to
negotiated settlements with positive results for shareholders and companies
alike. For example, one of our shareholder resolutions resulted in the company's
first-ever disclosure of its equal employment policies, programs and workforce
demographics.
About Calvert
Calvert Asset Management Company, Inc.(4550 Montgomery Avenue, Suite 1000N,
Bethesda, MD 20814) ("CAMCO") is the Fund's investment advisor. CAMCO provides
the Funds with investment supervision and management and office space; furnishes
executive and other personnel to the Fund, and pays the salaries and fees of all
Trustees who are affiliated persons of the Advisor. It has been managing mutual
funds since 1976. Calvert is the investment advisor for over 25 mutual fund
portfolios, including the first and largest family of socially screened funds.
As of September 30, 2000, Calvert had over $6 billion in assets under
management.
Subadvisor
Turner Investment Partners, Inc. (1235 Westlakes Drive, Berwyn, Pennsylvania
19312) has managed the Portfolio since inception. It uses a disciplined
approach to investing in growth stocks based on the premise that earnings
expectations drive stock prices.
Robert Turner is the founder, chairman, and chief investment officer of Turner
Investment Partners. He heads the Fund's portfolio management team. A
Chartered Financial Analyst, he was previously senior investment manager with
Meridian Investment Company.
The Fund has obtained an exemptive order from the Securities and Exchange
Commission to permit the Fund, pursuant to approval by the Board of Trustees, to
enter into and materially amend contracts with the Fund's Subadvisors without
shareholder approval. See "Investment Advisor and Subadvisor" in the SAI for
further details.
Advisory Fees
The Fund's advisory agreement provides for the Fund to pay CAMCO a fee of 1.25%
of the Fund's average daily net assets.
HOW TO OPEN AN ACCOUNT
Complete and sign an application for each new account. Be sure to specify Class
I. All purchases must be made by bankwire in U.S. dollars. For more
information and wire instructions, call Calvert Group at 800-327-2109.
Minimum To Open an Account $1,000,000
IMPORTANT - HOW SHARES ARE PRICED
The price of shares is based on each Fund's net asset value ("NAV"). NAV is
computed by adding the value of a Fund's holdings plus other assets, subtracting
liabilities, and then dividing the result by the number of shares outstanding.
If a Fund has more than one class of shares, the NAV of each class will be
different, depending on the number of shares outstanding for each class.
Portfolio securities and other assets are valued based on market quotations,
except that securities maturing within 60 days are valued at amortized cost. If
market quotations are not
<PAGE>
readily available, securities are valued by a method that the Fund's Board of
Trustees believes accurately reflects fair value.
The NAV is calculated as of the close of each business day, which coincides with
the closing of the regular session of the New York Stock Exchange ("NYSE")
(normally 4 p.m. ET). The Fund is open for business each day the NYSE is open.
Please note that there are some federal holidays, however, such as Columbus Day
and Veteran's Day, when the NYSE is open and the Fund is open but purchases
cannot be received because the banks and post offices are closed.
WHEN YOUR ACCOUNT WILL BE CREDITED
Your purchase will be processed at the next NAV calculated after your order is
received in good order. The Fund reserves the right to suspend the offering of
shares for a period of time or to reject any specific purchase order. All
purchases will be confirmed and credited to your account in full and fractional
shares (rounded to the nearest 1/1000th of a share).
OTHER CALVERT GROUP FEATURES
For 24 hour performance and account information
visit www.calvert.com or call 800-368-2745
TELEPHONE TRANSACTIONS
You may purchase, redeem, or exchange shares and wire funds by telephone if you
have pre-authorized service instructions and established bank instructions on
your account, when opened or at a later date by a signature-guaranteed letter.
You receive telephone privileges automatically when you open your account unless
you instruct us otherwise in writing.
While telephone redemption is easy and convenient, this account feature involves
a risk of loss from unauthorized or fraudulent transactions. Calvert will take
reasonable precautions to protect your account from fraud. You should do the
same by keeping your account information private and immediately reviewing any
confirmations or account statements that we send to you. Make sure to contact
Calvert immediately about any transaction you believe to be unauthorized.
We reserve the right to refuse a telephone redemption if the caller is unable to
provide:
- The account number.
- The name and address exactly as registered on the account.
- The primary Social Security or employer identification number as registered on
the account.
Please note that Calvert will not be responsible for any account losses due to
telephone fraud, so long as we have taken reasonable steps to verify the
caller's identity. If you wish to remove the telephone redemption feature from
your account, please notify us in writing.
EXCHANGES
Calvert Group offers a wide variety of investment options that includes common
stock funds, tax-exempt and corporate bond funds, and money market funds (call
your broker or Calvert representative for more information). We make it easy for
you to purchase shares in other Calvert funds if your investment goals change.
Complete and sign an account application, taking care to register your new
account in the same name and taxpayer identification number as your existing
Calvert account(s). Exchange instructions may then be given by telephone if
telephone redemptions have been authorized and the shares are not in certificate
form.
Before you make an exchange, please note the following:
Each exchange represents the sale of shares of one Fund and the purchase of
shares of another. Therefore, you could realize a taxable gain or loss.
Shares may only be exchanged for Class I shares of another Calvert Fund.
Bank Holidays: On any day Calvert is open but the Fund's custodian bank is
closed (e.g., Columbus Day and Veteran's Day) exchange requests into or out of a
money market fund will be priced at the next-determined NAV, but will not
receive any dividend in the money market fund until the next day the Fund's
custodian bank is open.
The Fund and the distributor reserve the right at any time to reject or cancel
any part of any purchase or exchange order; modify any terms or conditions of
purchase of shares of any Fund; or withdraw all or any part of the offering made
by this prospectus. To protect the interests of investors, the Fund and the
distributor may reject any order considered market-timing activity (the purchase
and sale of securities based on short-term price patterns as well as on asset
values).
The Fund reserves the right to terminate or modify the exchange privilege with
60 days' written notice.
ELECTRONIC DELIVERY OF PROSPECTUSES AND
SHAREHOLDER REPORTS
You may request to receive electronic delivery of prospectuses and annual and
semi annual reports.
COMBINED GENERAL MAILINGS (Householding)
Multiple accounts with the same social security number will receive one mailing
per household of information such as prospectuses and semi-annual and annual
reports. You may request further grouping of accounts to receive fewer mailings.
Separate statements will be generated for each separate account and will be
mailed in one envelope for each combination above.
SPECIAL SERVICES AND CHARGES
The Fund pays for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account. You may be required to pay a fee for these special services.
MINIMUM ACCOUNT BALANCE
Please maintain a balance in each of your Fund accounts of at least $1,000,000
per Fund. If due to redemptions, the
<PAGE>
account falls below the minimum, your account may be closed and the proceeds
mailed to the address of record. You will be given a notice that your account
is below the minimum and will be closed, or moved to Class A (at NAV) after 30
days if the balance is not brought up to the required minimum amount.
DIVIDENDS, CAPITAL GAINS AND TAXES
The Fund pays dividends from its net investment income annually. Net investment
income consists of interest income, net short-term capital gains, if any, and
dividends declared and on investments, less expenses. Distributions of net
short-term capital gains (treated as dividends for tax purposes) and net
long-term capital gains, if any, are normally paid once a year; however, the
Fund does not anticipate making any such distributions unless available capital
loss carryovers have been used or have expired. Dividend and distribution
payments will vary between classes.
Dividend payment options
Dividends and any distributions are automatically reinvested in the same Fund at
NAV, unless you elect to have amounts of $10 or more paid to you by wire to a
predesignated bank account. Dividends and distributions from any Calvert Group
Fund may be automatically invested in an identically registered account in the
came share class of any other Calvert Group Fund at NAV. If reinvested in the
same account, new shares will be purchased at NAV on the reinvestment date,
which is generally 1 to 3 days prior to the payment date. You must notify the
Fund in writing to change your payment options.
Buying a Dividend
At the time of purchase, the share price of each class may reflect undistributed
income, capital gains or unrealized appreciation of securities. Any income or
capital gains from these amounts which are later distributed to you are fully
taxable. On the record date for a distribution, share value is reduced by the
amount of the distribution. If you buy shares just before the record date
("buying a dividend") you will pay the full price for the shares and then
receive a portion of the price back as a taxable distribution.
Federal Taxes
In January, the Fund will mail you Form 1099-DIV indicating the federal tax
status of dividends and any capital gain distributions paid to you during the
past year. Generally, dividends and distributions are taxable in the year they
are paid. However, any dividends and distributions paid in January but declared
during the prior three months are taxable in the year declared. Dividends and
distributions are taxable to you regardless of whether they are taken in cash or
reinvested. Dividends, including short-term capital gains, are taxable as
ordinary income. Distributions from long-term capital gains are taxable as
long-term capital gains, regardless of how long you have owned shares.
You may realize a capital gain or loss when you sell or exchange shares. This
capital gain or loss will be short- or long-term, depending on how long you have
owned the shares which were sold. In January, the Fund will mail you Form 1099-B
indicating the total amount of all sales, including exchanges. You should keep
your annual year-end account statements to determine the cost (basis) of the
shares to report on your tax returns.
Other Tax Information
In addition to federal taxes, you may be subject to state or local taxes on your
investment, depending on the laws in your area. You will be notified to the
extent, if any, that dividends reflect interest received from US government
securities. Such dividends may be exempt from certain state income taxes.
Taxpayer Identification Number
If we do not have your correct Social Security or Taxpayer Identification Number
("TIN") and a signed certified application or Form W-9, Federal law requires us
to withhold 31% of your reportable dividends, and possibly 31% of certain
redemptions. In addition, you may be subject to a fine by the Internal Revenue
Service. You will also be prohibited from opening another account by exchange.
Calvert Group reserves the right to reject any new account or any purchase order
for failure to supply a certified TIN.
HOW TO SELL SHARES
You may redeem all or a portion of your shares on any day your Fund is open for
business. Your shares will be redeemed at the next NAV calculated after your
redemption request is received by the transfer agent in good order (see below).
The proceeds will normally be sent to you on the next business day, but if
making immediate payment could adversely affect the Fund, it may take up to
seven (7) days to make payment. The Funds have the right to redeem shares in
assets other than cash for redemption amounts exceeding, in any 90-day period,
$250,000 or 1% of the net asset value of the Fund, whichever is less. When the
NYSE is closed (or when trading is restricted) for any reason other than its
customary weekend or holiday closings, or under any emergency circumstances as
determined by the Securities and Exchange Commission, redemptions may be
suspended or payment dates postponed. Please note that there are some federal
holidays, however, such as Columbus Day and Veterans' Day, when the NYSE is open
and the Fund is open but redemptions cannot be mailed or wired because the post
offices and banks are closed.
Request in "Good Order"
All redemption requests must be received by the transfer agent in "good order."
This means that your request must include:
- The Fund name and account number
- The amount of the transaction (in dollars or shares).
- Signatures of all owners exactly as registered on the account (for mail
requests).
- Signature guarantees (if required).*
- Any supporting legal documentation that may be required.
- Any outstanding certificates representing shares to be redeemed.
<PAGE>
*For instance, a signature guarantee must be provided by all registered account
shareholders when redemption proceeds are sent to a different person or address.
A signature guarantee can be obtained from most commercial and savings banks,
credit unions, trust companies, or member firms of a U.S. stock exchange. Please
note: Notarization is not the equivalent of a signature guarantee.
Transactions are processed at the next determined share price after the transfer
agent has received all required information.
Follow these suggestions to ensure timely processing of your redemption request:
By Telephone - call 800-368-2745
You may redeem shares from your account by telephone and have your money wired
to an address or bank you have previously authorized. Class I redemptions must
be made by wire.
If you want the money to be wired to a bank not previously authorized, then a
voided bank check must be provided. To add instructions to wire to a
destination not previously established, or if you would like funds sent to a
different address or another person, your letter must be signature guaranteed.
<PAGE>
To Open an Institutional (Class I) Account:
800-327-2109
Performance and Prices:
www.calvert.com
Service for Existing Accounts:
Shareholders 800-327-2109
TDD for Hearing-Impaired:
800-541-1524
Calvert Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, MD 20814
Registered, Certified or
Overnight Mail:
Calvert Group
c/o NFDS
330 West 9th Street
Kansas City, MO 64105
Calvert Group Web-Site
www.calvert.com
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, MD 20814
<PAGE>
For investors who want more information about the Fund, the following documents
will be available, once filed, free upon request:
Annual/Semi-Annual Reports: Additional information about the Fund's investments
is available in the Fund's Annual and Semi-Annual reports to shareholders. In
the Fund's annual report, you will find a discussion of the market conditions
and investment strategies that significantly affected the Fund's performance
during its last fiscal year.
Statement of Additional Information (SAI): The SAI for the Fund provides more
detailed information about the Fund and is incorporated into this prospectus by
reference.
You can get free copies of reports and SAIs, request other information and
discuss your questions about the Funds by contacting your financial
professional, or the Fund at:
Calvert Group
4550 Montgomery Ave, Suite 1000N
Bethesda, MD 20814
Telephone: 1-800-368-2745
Calvert Group Web-Site
www.calvert.com
You can review the Fund's reports and SAIs at the Public Reference Room of the
Securities and Exchange Commission.
You can get text-only copies:
For a fee, by writing to or calling the Public Reference Section of the
Commission, Washington, D.C. 20549-0102. Telephone: 202-942-8090 or by
electronic request at the following E-mail address: [email protected].
Free from the Commission's Internet website at
www.sec.gov.
Investment Company Act file:
no.811- 3334
