Rule 497(k)(1)(ii)
LUTHERAN BROTHERHOOD LIMITED MATURITY BOND FUND
FUND PROFILE
CLASS A AND CLASS B SHARES
December 15, 1999
This Profile summarizes key information about the Lutheran Brotherhood
Limited Maturity Bond Fund that is included in the Fund's prospectus. The
Fund's prospectus includes additional information about the Fund, including
a more detailed description of the risks associated with investing in the
Fund that you may want to consider before you invest. You may obtain the
prospectus and other information about the Fund at no cost by calling:
o 1-800-328-4552 for our Automated Service Line
o 1-800-365-5058 to speak with a Customer Service Associate
The prospectus is also available on the internet at www.luthbro.com.
1. WHAT IS THE FUND'S INVESTMENT OBJECTIVE?
The investment objective of the Fund is to seek a high level of current
income consistent with stability of principal.
2. WHAT ARE THE PRINCIPAL STRATEGIES OF THE FUND?
The Fund invests primarily in investment-grade corporate bonds,
government bonds, municipal bonds, asset-backed securities, and mortgage-
backed securities. Under normal market conditions, the Fund will invest at
least 65% of its assets in investment-grade securities. The Fund may also
invest in high-yield, high risk bonds, notes, debentures and other debt
obligations or preferred stock commonly known as "junk bonds." The average
dollar-weighted portfolio maturity for the Fund is between one and five
years.
The Fund's management uses both fundamental and technical investment
research techniques to determine what debt obligations to buy and sell. It
focuses on companies which it believes are financially sound and have strong
cash flow, asset values and interest or dividend earnings.
3. WHAT ARE THE PRINCIPAL RISKS OF THE FUND?
o Interest Rate Risk--Generally, when interest rates rise, bond prices
fall, which may cause the price of shares of the Fund to fall as
well. Bond prices fall because bonds issued after rates rise will
offer higher yields, making older bonds with lower rates less
attractive. To raise the effective yield on older bonds, holders of
the older bonds must discount their prices. Bonds with longer
durations and maturities tend to be more sensitive to changes in
interest rates than bonds with shorter durations or maturities.
o Prepayment and Extension Risk-Both mortgage-backed and asset-backed
securities are sensitive to changes in the redemption patterns of the
underlying securities or mortgages. If the principal payment on the
underlying asset is repaid faster or slower than the holder of the
asset-backed or mortgage-backed security anticipates, the price of
the security may fall, especially if the holder must reinvest the
repaid principal at lower rates or must continue to hold the
securities when interest rates rise.
o Credit Risk--For all bonds there is a risk that an issuer will
default. Lower rated bonds generally are more susceptible to risk of
default than higher rated bonds, so this risk increases as a Fund
increases the amount it invests in lower rated investment-grade bonds
or in high-yield bonds.
o Loss of Principal--Shares of the Fund will rise and fall in value and
there is a risk that you could lose money by investing in the Fund.
The Fund cannot be certain that it will achieve its objective.
No bar chart or performance table has been included for the Fund
because it commenced operations on October 29, 1999.
4. WHAT ARE THE FEES AND EXPENSES OF THE FUND?
This table describes the fees and expenses that you may pay if you buy and
hold shares of a Fund.
SHAREHOLDER FEES-The Fund is a no-load fund so there are no shareholder fees
deducted directly from your account. Class B shareholders of the Fund will
be responsible for any Contingent Deferred Sales Charge that may be payable
at the time of redemption as a result of an investment in another fund in
The Lutheran Brotherhood Family of Funds.
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund
assets)
CLASS A CLASS B
------- -------
Management Fees 0.30% 0.30%
Distribution (12b-1) Fees none none
Other Expenses (including a 0.25% 1.09% 1.09%
shareholder servicing fee)(1)
Total Annual Fund Operating Expenses (2) 1.39% 1.39%
(1) Because the Fund has been newly organized, the percentage expense
levels shown in the table as "Other Expenses" are based on estimates.
(2) The Fund's investment adviser has voluntarily agreed to temporarily
waive a portion of its advisory fee and, if necessary, to bear certain
expenses associated with operating the Fund in order to limit the Total
Annual Fund Operating Expenses for the Class A shares and Class B shares to
an annual rate of 0.95% of the average net assets of each class. This
temporary waiver and expense provision may be discontinued at any time.
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 AND THEN REDEEM ALL OF YOUR SHARES AT THE END OF THOSE PERIODS.
THE EXAMPLE ALSO ASSUMES THAT YOUR INVESTMENT HAS A 5% RETURN EACH YEAR AND
THAT THE FUND'S OPERATING EXPENSES REMAIN THE SAME. ALTHOUGH YOUR ACTUAL
COSTS MAY BE HIGHER OR LOWER, BASED ON THESE ASSUMPTIONS YOUR COSTS WOULD
BE:
1 Year 3 Years
------ -------
Class A shares $142 $440
Class B shares $142 $440
YOU WOULD PAY THE FOLLOWING EXPENSES IF YOU DID NOT REDEEM YOUR SHARES:
1 Year 3 Years
------ -------
Class A shares $142 $440
Class B shares $142 $440
5. WHO MANAGES THE FUND?
Lutheran Brotherhood Research Corp serves as investment adviser for the
Fund. Michael G. Landreville, assistant vice president of LB Research,
serves as portfolio manager of the Fund. Mr. Landreville also has served as
portfolio manager of Lutheran Brotherhood Income Fund since September 1,
1999. He was portfolio co-manager of Lutheran Brotherhood Income Fund from
January 1, 1998, through August 31, 1999, and associate portfolio manager
from 1987 through 1997. Mr. Landreville has been with Lutheran Brotherhood
and Lutheran Brotherhood Research Corp. since 1983.
6. HOW CAN I BUY SHARES OF THE FUND?
To make your first purchase of the Class A shares of the Fund:
o complete and sign the application
o enclose a check made payable to The Lutheran Brotherhood Family of
Funds
o mail your application and check to Lutheran Brotherhood Securities
Corp., P.O. Box 310, Minneapolis, MN 55440-0310
Class B shares of the Fund are offered solely in exchange for Class B
shares of other funds of The Lutheran Brotherhood Family of Funds.
You can also buy shares of the Fund through your Lutheran Brotherhood
Securities Corp. Registered Representative.
The minimum initial investment is $2,500 for a regular account and $100 per
month for a systematic investment plan. Additional purchases can be made
for $100.
7. HOW CAN I SELL FUND SHARES?
You may redeem your shares:
o in writing by sending a written request to Lutheran Brotherhood
Securities Corp., P.O. Box 9491, Minneapolis, Minnesota 55440-9491
o by calling 1-800-328-4552 for our Automated Service Line or
1-800-990-6290 to speak with a Customer Service Associate
o on the internet at www.luthbro.com.
o through a systematic withdrawal plan
Once we receive your request for redemption, we will redeem your shares
at the next net asset value on any day on which the New York Stock Exchange
is open for business, or any other day as required under the rules of the
Securities and Exchange Commission.
8. HOW ARE FUND DISTRIBUTIONS MADE AND TAXED?
The Fund expects to declare dividends daily and pay them monthly.
Capital gains distributions, if any, usually will be declared in December.
When completing your application, you must select one of the following four
options for dividends and capital gains distributions:
o Full Reinvestment--Both dividends and capital gains distributions
from the Fund will be reinvested in additional shares of the same
class of the Fund. This option will be selected automatically
unless one of the other options is specified.
o Full Reinvestment in a Different Fund--You may also choose to have
your dividends reinvested into an existing account in another Fund
within The Lutheran Brotherhood Family of Funds.
o All Cash--Dividends and capital gains distributions will be paid in
cash. Your request to receive all or a portion of your dividends
and other distributions in cash must be received by Lutheran
Brotherhood Securities Corp. at least ten days before the record date
of the dividend or other distribution.
o Part Cash and Part Reinvestment--You may request to have part of
your dividends paid in cash and part of your dividends reinvested
in additional shares of the same class of the Fund.
Distributions paid in shares will be credited to your account at the
next determined NAV per share.
In general, any dividends and short-term capital gains distributions
you receive from the Fund are taxable as ordinary income. Distributions of
other net capital gains by the Fund are generally taxable as capital gains -
in most cases, at different rates from those that apply to ordinary income.
We expect that dividends from the Fund will consist primarily of ordinary
income.
Every year, the Fund will send you information detailing the amount of
ordinary income and capital gains distributed to you for the previous year.
The tax you pay on a given capital gains distribution generally depends on
how long the Fund has held the portfolio securities it sold. It does not
depend on how long you have owned your Fund shares or whether you reinvest
your distributions or take them in cash.
Your investment in the Fund could have additional tax consequences.
Please consult your tax professional for assistance.
9. WHAT SERVICES ARE OFFERED BY THE FUND?
A wide range of services are provided to the Fund's shareholders, including,
but not limited to:
o exchange privileges with other Funds in The Lutheran Brotherhood Family
of Funds
o 24-hour access with our Automated Service Line--1-800-328-4552
o 24-hour access on the internet at www.luthbro.com.
o personal service by calling 1-800-365-5058 to speak with a Customer
Service Associate or by visiting with a Registered Representative of
Lutheran Brotherhood Securities Corp.
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