SEC Registration Nos.
2-76510 and 811-3416
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
Post-Effective Amendment No. 33 XX
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 33 XX
The Calvert Fund
Calvert Income Fund
(Exact Name of Registrant as Specified in Charter)
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Address of Principal Executive Offices)
Registrant's Telephone Number: (301) 951-4800
William M. Tartikoff, Esq.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
Immediately upon filing XX on January 31, 1998
pursuant to paragraph (b) pursuant to paragraph (b)
60 days after filing on (date)
pursuant to paragraph (a) pursuant to paragraph (a)
of Rule 485.
The Calvert Fund
Form N-1A Cross Reference Sheet
Item number Prospectus Caption
1. Cover Page
2. Fund Expenses
3. Financial Highlights
Total Return
4. Investment Objective and Policies
Management of the Fund
5. Management of the Fund
6. Alternative Sales Options
Management of the Fund
Dividends, Capital Gains and Taxes
7. How to Buy Shares
Net Asset Value
Reduced Sales Charges
When Your Account Will Be Credited
Exchanges
8. Alternative Sales Options
How to Sell Your Shares
9. *
Statement of Additional Information Caption
10. Cover Page
11. Table of Contents
12. General Information
13. Investment Objective and Policies
Loans of Portfolio Securities
Repurchase Agreements
Investment Restrictions
Fund Transactions
14. Trustees and Officers
15. *
16. Investment Advisor and Investment Manager
Transfer and Shareholder Servicing Agent
Independent Accountants and Custodians
17. Portfolio Transactions
18. *
19. Valuation of Shares
Purchase and Redemption of Shares
Reduced Sales Charge
20. Dividends and Taxes
21. Method of Distribution
22. Calculation of Total Return
23. Financial Statements
* Inapplicable or negative answer
<PAGE>
Prospectus January 31, 1998
The CALVERT FUND
Calvert Income Fund
4550 Montgomery Avenue, Bethesda, Maryland 20814
Investment Objective
Calvert Income Fund seeks to maximize long-term income, to the extent
consistent with prudent investment management and preservation of capital,
through investment in bonds and other income producing securities.
To Open An Account
Call your broker, or complete and return the enclosed Account Application.
Minimum investment is $2,000.
About This Prospectus
Please read this Prospectus before investing. It is designed to provide you
with information you ought to know before investing and to help you decide if
the Fund's goals match your own. Keep this document for future reference.
A Statement of Additional Information for the Fund ("SAI") (dated
January 31, 1998) has been filed with the Securities and Exchange Commission
(the "Commission") and is incorporated by reference. This free statement is
available upon request from the Fund: 800-368-2748. The Commission maintains a
website (http://www.sec.gov) that contains the SAI, material incorporated by
reference, and other information regarding registrants that file electronically
with the Commission.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE federal OR
ANY STATE SECURITIES COMMISSION PASSED ON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Shares of the fund are not deposits or obligations of, or guaranteed or
endorsed by, any bank, and are not federally insured by the fdic, the federal
reserve board, or any other agency. When investors sell shares of the fund,
the value may be higher or lower than the amount originally paid.
FUND EXPENSES
A. Shareholder
Transaction Costs
Maximum Sales Charge on Purchases
(as a percentage of offering price) 3.75%
Contingent Deferred Sales Charge None
B. Annual Fund Operating Expenses - Fiscal Year 1997
(as a percentage of average net assets)
Management Fees 0.70%
Rule 12b-1 Service and Distribution Fees 0.15%
Other Expenses 0.48%
Total Fund Operating Expenses* 1.33%
*Net Fund Operating Expenses after reduction for fees paid indirectly
were: 1.26%.
C. Example:
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return; (2) redemption at the end of each period; and (3)
payment of maximum initial sales charge at time of purchase:
1 Year 3 Years 5 Years 10 Years
Calvert Income $51 $78 $108 $192
The example, which is hypothetical, should not be considered a representation
of past or future expenses. Actual expenses and return may be higher or lower
than those shown.
Explanation of Table: The purpose of the table is to assist you in
understanding the various costs and expenses that an investor in the Fund may
bear directly (shareholder transaction costs) or indirectly (annual fund
operating expenses).
Shareholder Transaction Costs
are charges you pay when you buy or sell shares of the Fund. See "Reduced
Sales Charges" at Exhibit A to see if you qualify for possible reductions in
the sales charge. If you request a wire redemption of less than $1,000, you
will be charged a $5 wire fee.
Annual Fund Operating Expenses
Management Fees are paid by the Fund to Calvert Asset Management Company, Inc.
("Investment Advisor") for managing the Fund's investments and business
affairs. The Fund incurs Other Expenses for maintaining shareholder records,
furnishing shareholder statements and reports, and other services. Management
Fees and Other Expenses have already been reflected in the Fund's share price
and are not charged directly to individual shareholder accounts. Please refer
to "Management of the Fund" for further information.
The Fund's Rule 12b-1 fees include an asset-based sales charge. Thus,
long-term shareholders in the Fund may pay more in total sales charges than
the economic equivalent of the maximum front-end sales charge permitted by
rules of the National Association of Securities Dealers, Inc. In addition to
the compensation itemized above (sales charge and Rule 12b-1 service and
distribution fees), certain broker/dealers and/or their salespersons may
receive certain compensation for the sale and distribution of the securities
or for services to the Fund. See the SAI, "Method of Distribution."
Financial Highlights
The following table provides information about the financial history of the
Fund. It expresses the information in terms of a single share outstanding for
the Fund throughout each period. The table has been audited by those
independent accountants whose reports are included in the Annual Reports to
Shareholders of the Fund. The table should be read in conjunction with the
financial statements and their related notes. The current Annual Report to
Shareholders is incorporated by reference into the SAI.
Year Ended Sept. 30,
Calvert Income 1997 1996 1995
Net asset value, beginning of period $16.47 $16.82 $15.68
Income from investment operations
Net investment income 1.02 1.01 1.11
Net realized and unrealized
gain (loss) .74 (.32) 1.14
Total from investment operations 1.76 .69 2.25
Distributions from
Net investment income (1.02) (1.01) (1.11)
Net realized gain (.01) - -
In excess of net realized gain - (.03) -
Total Distributions (1.03) (1.04) (1.11)
Total increase (decrease) in
net asset value .73 (.35) 1.14
Net asset value, ending $17.20 $16.47 $16.82
Total return2 11.03% 4.21% 14.90%
Ratio to average net assets:
Net investment income 6.04% 6.02% 6.89%
Total expenses3 1.33% 1.26% 1.26%
Net expenses 1.26% 1.23% 1.23%
Portfolio turnover 2,961% 153% 135%
Net assets, ending (in thousands) $39,302 $44,431 $42,637
Number of shares outstanding
ending (in thousands) 2,285 2,698 2,535
2Total return does not reflect deduction of the Fund's front-end sales
charges. Total return prior to 1989 is not audited.
3Effective September 30, 1995, this ratio reflects total expenses before
reduction for fees paid indirectly; such reductions are included in the
ratio of net expenses.
N/A - Disclosure not applicable to prior periods.
Year Ended September 30,
Calvert Income Fund 1994 1993 1992
Net asset value, beginning of year $18.41 $17.50 $16.61
Income from investment operations
Net investment income 1.16 1.23 1.28
Net realized and unrealized
gain (loss) (2.42) .91 .89
Total from investment operations (1.26) 2.14 2.17
Distributions from
Net investment income (1.16) (1.23) (1.28)
In excess of net realized gain (.31) - -
Total Distributions (1.47) (1.23) (1.28)
Total increase (decrease) in
net asset value (2.73) .91 .89
Net asset value, ending $15.68 $18.41 $17.50
Total return4 (6.94)% 12.47% 13.66%
Ratio to average net assets:
Net investment income 6.86% 6.93% 7.59%
Total expenses5 N/A N/A N/A
Net expenses 1.07% 1.00% 1.04%
Expenses reimbursed
and/or waived N/A N/A N/A
Portfolio turnover 34% 25% 18%
Net assets, ending (in thousands) $45,936 $53,134 $43,494
Number of shares outstanding at
ending (in thousands) 2,929 2,886 2,486
Year Ended September 30,
1991 1990 1989 1988
$15.58 $16.36 $15.70 $15.29
1.31 1.36 1.36 1.42
1.03 (.78) .71 .71
2.34 .58 2.07 2.13
(1.31) (1.36) (1.41) (1.42)
- - - (.30)
(1.31) (1.36) (1.41) (1.72)
1.03 (.78) .66 .41
$16.61 $15.58 $16.36 $15.70
15.72% 3.63% 13.48% 14.67%
8.22% 8.42% 8.57% 9.07%
N/A N/A N/A N/A
1.08% 1.05% 1.07% .94%
N/A N/A N/A .25%
27% 5% 19% 37%
$36,413 $32,201 $22,969 $20,375
2,193 2,066 1,404 1,298
4Total return does not reflect deduction of the Fund's front-end sales
charges. Total return prior to 1989 is not audited.
5Effective September 30, 1995, this ratio reflects total expenses before
reduction for fees paid indirectly; such reductions are included in the ratio
of net expenses.
N/A - Disclosure not applicable to prior periods.
INVESTMENT OBJECTIVE AND POLICIES
Calvert Income Fund invests in a variety of fixed-income securities, 65% of
which must be of investment grade quality.
Calvert Income Fund seeks to maximize long-term income, to the extent
consistent with prudent investment management and preservation of capital,
primarily through investment in investment-grade bonds and other
income-producing securities. The Fund is non-diversified. Debt securities may
be long-term, intermediate-term, short-term, or any combination thereof,
depending on the Advisor's evaluation of current and anticipated market
patterns and trends.
Calvert Income Fund invests 80% of its assets in corporate obligations and
other fixed-income securities. At least 65% of its net assets at the date of
investment are rated within the four highest grades established by Moody's
Investors Services, Inc. (Aaa, Aa, A, or Baa), or by Standard and Poor's
Corporation (AAA, AA, A, or BBB), or if not rated, are of comparable quality
as determined by the Advisor. All fixed-income instruments are subject to
interest-rate risk; that is, when market interest rates rise, the current
principal value of a bond will decline.
The remaining 35% of the Fund's net assets may consist of other debt
securities (see below) including bonds rated below BBB or Baa
(noninvestment-grade securities). With lower rated bonds, there is a greater
possibility that an adverse change in the financial condition of the issuer
may affect its ability to pay principal and interest. In addition, to the
extent the Fund holds any such bonds, it may be negatively affected by adverse
economic developments, increased volatility or a lack of liquidity. See the
SAI, "Noninvestment-Grade Debt Securities," and bond ratings.
Calvert Income Fund may also purchase obligations issued or guaranteed as to
principal by the US Government or its agencies or instrumentalities;
certificates of deposit, time deposits, and bankers' acceptances of US banks
and their branches located outside of the US and of US branches of foreign
banks, provided that the bank has total assets of at least $1 billion or the
equivalent in other currencies; commercial paper which at the date of
investment is rated Prime-2 or better by Moody's, A-2 or better by Standard &
Poor's, or, if not rated, is of comparable quality as determined by the
Advisor; and any of the above securities subject to repurchase agreements
with recognized securities dealers and banks. Up to 20% of the value of the
Fund's net assets may consist of other debt securities (including securities
convertible into or carrying warrants to purchase common stock or other equity
securities) and income-producing preferred and common stocks.
GNMA Certificates
GNMA Certificates, or GNMAs, are mortgage-backed securities representing
ownership of mortgage or construction loans that are issued by lenders such as
mortgage bankers, commercial banks and savings and loan associations and are
either insured by the Federal Housing Administration or guaranteed by the
Veterans Housing Administration. The GNMA may be secured by a single mortgage,
such as a large multi-family housing development, or, more typically, by a
"pool" or group of single-family housing mortgages. Once approved by GNMA, the
timely payment of interest and principal on each mortgage is guaranteed by
GNMA and backed by the full faith and credit of the US Government. GNMAs
differ from bonds in that principal is paid back monthly by the borrower over
the term of the loan rather than returned in a lump sum at maturity. GNMAs are
called "pass-through" securities because both interest and principal payments
(including prepayments) are passed through to the holder of the GNMA. Upon
receipt, principal payments will be reinvested by the Fund in additional
securities at the then prevailing interest rate. The amount of any premium
that may be paid upon purchase of a GNMA is not guaranteed. The Advisor will
attempt, through careful evaluation of available GNMA issues and prevailing
market conditions, to invest in GNMAs which provide a high income return but
are not subject to substantial risk of loss of principal. Accordingly, the
Advisor may forgo the opportunity to invest in certain issues of GNMAs which
would provide a high current income yield if the Advisor believes that such
issues would be subject to a risk of prepayment or loss of principal over the
long-term that would outweigh the short-term increment in yield.
Collateralized Mortgage Obligations
Collateralized mortgage obligations ("CMOs") are bonds which are the general
obligations of the bond issuer. CMOs may be issued by governmental entities,
such as the Federal Home Loan Mortgage Corporation (FHLMC), and by
non-governmental entities, such as banks and other mortgage lenders. CMOs
generally are secured by collateral consisting of individual mortgages or a
pool of mortgages. CMOs are not direct obligations of the Government.
FNMA and FHLMC Certificates
The Fund may invest in pass-through certificates issued by the Federal
National Mortgage Association ("FNMA") and Federal Home Loan Mortgage
Corporation ("FHLMC"). Unlike GNMAs, which are typically interests in pools of
mortgages insured or guaranteed by government agencies, FNMA and FHLMC
certificates represent undivided interests in pools of conventional mortgage
loans.
Nondiversified
There may be risks associated with the Fund being nondiversified.
Specifically, since a relatively high percentage of the assets of the Fund may
be invested in the obligations of a limited number of issuers, the value of
the shares of the Fund may be more susceptible to any single economic,
political or regulatory event than the shares of a diversified fund would be.
Financial Futures, Options, and Other Investment Techniques
The Fund can use various techniques to increase or decrease its exposure to
changing security prices, interest rates, currency exchange rates or other
factors that affect security values. These techniques may involve derivative
transactions such as buying and selling options and futures contracts and
leveraged notes, entering into currency exchange contracts, or swap
agreements, and purchasing indexed securities. The Fund can use these
practices either as substitution or as protection against an adverse move in
the Fund's portfolio to adjust the risk and return characteristics of the
Fund's portfolio. If the Advisor judges market conditions incorrectly or
employs a strategy that does not correlate well with the Fund's investments,
or if the counterparty to the transaction does not perform as promised, these
techniques could result in a loss. These techniques may increase the
volatility of the Fund and may involve a small investment of cash relative to
the magnitude of the risk assumed. Any instruments determined to be illiquid
are subject to the Fund's 15% restriction on illiquid securities. See the SAI
for more details about these strategies.
Hedging Strategies
The Fund may use short sales of US Treasury securities for the limited purpose
of hedging the Fund's duration (duration is a measure of the interest
rate-sensitivity of the Fund). Any short sales will be "covered" with an
equivalent amount of high quality, liquid securities in a segregated account
at the Fund's custodian. This hedging technique is intended to lower the
Fund's interest rate risk. However, as with other hedging strategies, the Fund
takes the risk that the strategy may not correlate well with the risk it is
intended to hedge against, or that the Advisor has judged market conditions
incorrectly.
Portfolio Turnover
The Fund's investment strategy causes it to have a relatively high portfolio
turnover compared to other funds. For the year ended September 30, 1997, the
portfolio turnover was 2,961%. All else being equal, a fund with high turnover
may incur higher transaction costs such as custodian and settlement fees, etc.
Also, funds with higher turnover may subject a shareholder to capital gains
taxes for unsold shares, whereas, unrealized gains are not subject to taxation
until a shareholder sells the fund shares. See "Dividends, Capital Gains, and
Taxes."
The Fund may enter into repurchase agreements and may purchase securities on a
forward or when-issued basis.
In a repurchase agreement, the Fund buys a security subject to the right and
obligation to sell it back at a higher price. These transactions must be fully
secured at all times, but they involve some credit risk to the Fund if the
other party defaults on its obligation and the Fund is delayed or prevented
from liquidating the collateral.
Purchasing obligations for future delivery or on a "when-issued" basis may
increase the Fund's overall investment exposure and involves a risk of loss if
the value of the securities declines prior to the settlement date. The
transactions are fully secured at all times.
Foreign Investments
The Fund may invest up to 20% of its assets in securities of foreign issuers,
and hedge its foreign securities holdings against anticipated adverse moves in
foreign currency exchange rates. The Fund may use either the spot (cash)
markets, forward contracts, or currency financial futures and options
transactions. It is impossible to forecast with precision the foreign currency
values, and the Fund could incur a loss on such currency transactions if the
market moves against the position it has taken. Securities of foreign issuers
may offer greater potential for capital appreciation or income than the
securities of domestic issuers and may involve investment risks that are
greater than those inherent in the securities of domestic issuers. Such
differences might possibly result from future political and economic
developments, disparities in economic systems, and imposition of foreign
governmental restrictions. There may also be less publicly available
information about a foreign issuer than about a domestic issuer; foreign
issuers are not generally subject to uniform auditing, accounting and
reporting requirements comparable to those applicable to domestic issuers.
Other Policies
The Fund may borrow money from banks as a temporary measure for extraordinary
or emergency purposes. An explanation of this and the policies below is set
forth in the SAI.
The Fund may lend its portfolio securities to member firms of the New York
Stock Exchange and commercial banks with assets of $1 billion or more, but
only if the value of the securities loaned from a Fund will not exceed
one-third of the Fund's assets.
The Fund has adopted certain fundamental investment restrictions which are
discussed in detail in the SAI. Unless specifically noted otherwise, the
investment objective, policies and restrictions of the Fund are fundamental
and may not be changed without shareholder approval.
Although US Government-backed obligations in the Fund's portfolio may be
guaranteed by the Government, the Fund's net asset value per share and yield
are not guaranteed and will change in response to market conditions. There can
be no assurance that the Fund will be successful in meeting its investment
objective.
Yield and Total Return
The Fund may advertise yield and total return.
Yield measures the current investment performance of the Fund, that is, the
rate of income on its portfolio investments divided by the share price. Yield
is computed by annualizing the result of dividing the net investment income
per share over a 30-day period by the maximum offering price per share on the
last day of that period. Yields are calculated according to accounting methods
that are standardized for all stock and bond funds.
Both yield and total return are based on historical results and are not
intended to indicate future performance.
Total return includes not only the effect of income dividends but also any
change in net asset value, or principal amount, during the stated period. The
total return shows its overall change in value, including changes in share
price and assuming all of the dividends and capital gain distributions are
reinvested. A cumulative total return reflects the performance over a stated
period of time. An average annual total return reflects the hypothetical
annual compounded return that would have produced the same cumulative total
return if the performance had been constant over the entire period. Because
average annual returns tend to smooth out variations in the returns, you
should recognize that they are not the same as actual year-by-year results.
Both types of returns usually will include the effect of paying the Fund's
sales charge. Returns will be higher, of course, if sales charges are not
taken into account. Quotations of "return without maximum sales load" do not
reflect deduction of the sales charge. You should consider these figures only
if you qualify for a reduced sales charge, or for purposes of comparison with
comparable figures which also do not reflect sales charges, such as mutual
fund averages compiled by Lipper Analytical Services, Inc. Further information
about the Fund's performance is contained in its Annual Report to
Shareholders, which may be obtained without charge.
MANAGEMENT OF THE FUND
The Trust's Board of Trustees supervises the Trust's activities and reviews
its contracts with companies that provide it with services.
Calvert Income Fund is a series of The Calvert Fund (the "Trust"), an open-end
management investment company organized as a Massachusetts business trust on
March 15, 1982. The other series of the Fund is Calvert New Vision Small Cap
Fund.
The Trust is not required to hold annual shareholder meetings, but special
meetings may be called for certain purposes such as electing Trustees,
changing fundamental policies, or approving a management contract. As a
shareholder, you receive one vote for each share of the Fund you own.
Portfolio Managers
Since February 11, 1995, investment selections for the Fund have been made by
a committee of the Advisor's fixed-income portfolio managers.
Calvert Group is one of the largest investment management firms in the
Washington, D.C. area.
Calvert Group, Ltd., parent of the Fund's investment advisor, shareholder
servicing agent, and distributor, is a subsidiary of Acacia Mutual Life
Insurance Company of Washington, D.C. Calvert Group is one of the largest
investment management firms in the Washington, D.C. area. Calvert Group, Ltd.
and its subsidiaries are located at 4550 Montgomery Avenue, Suite 1000N,
Bethesda, Maryland 20814. As of December 31, 1997, Calvert Group managed and
administered over $5 billion in assets and more than 200,000 shareholder and
depositor accounts.
Calvert Asset Management Company, Co. serves as Advisor to the Fund.
Calvert Asset Management Company, Inc. (the "Advisor") is the Fund's
investment advisor. The Advisor provides the Fund with investment supervision
and management; administrative services 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. The Advisor may also
assume and pay certain advertising and promotional expenses of the Fund and
reserves the right to compensate broker/dealers in return for their
promotional or administrative services.
The Advisor receives a fee based on a percentage of the Fund's assets.
For its services during the fiscal year ended September 30, 1997, pursuant to
the Investment Advisory Agreement, the Advisor received an investment advisory
fee of 0.70% of the Fund's respective average daily net assets.
Calvert Distributors, Inc. serves as underwriter to market the Fund's shares.
Calvert Distributors, Inc. ("CDI") is the Fund's principal underwriter and
distributor. Under the terms of its underwriting agreement with the Fund, CDI
markets and distributes the Fund's shares and is responsible for payment of
commissions and service fees to broker/dealers, banks, and financial services
firms, preparation of advertising and sales literature, and printing and
mailing of prospectuses to prospective investors.
The transfer agent keeps your account records
Calvert Shareholder Services, Inc. is the Fund's shareholder servicing agent.
National Financial Data Service, Inc. ("NFDS"), 1004 Baltimore, Kansas City,
Missouri, 64105, is the transfer and dividend disbursing agent for the Fund.
SHAREHOLDER GUIDE
Opening An Account
You can buy shares of the Fund in several ways which are described here and in
the chart below.
An account application accompanies this prospectus. A completed and signed
application is required for each new account you open, regardless of the
method you choose for making your initial investment. Additional forms may be
required from corporations, associations, and certain fiduciaries. If you have
any questions or need extra applications, call your broker, or Calvert Group
at 800-368-2748.
To invest in any of Calvert's tax-deferred retirement plans, please call
Calvert Group at 800-368-2748 to receive information and the required separate
application.
Sales Charge
Fund shares are offered at net asset value plus a front-end sales charge as
follows:
Amount of As a % of As a %of Allowed to
Investment offering net amount Dealers as
price invested a % of
offering
price
Less than $50,000 3.75% 3.90% 3.00%
$100,000 but less than $250,000 2.25% 2.30% 1.75%
$250,000 but less than $500,000 1.75% 1.78% 1.25%
$500,000 but less than $1,000,000 1.00% 1.01% 0.80%
$1,000,000 and over 0.00% 0.00% 0.25%*
*CDI reserves the right to recoup any portion of the amount paid to the dealer
if the investor redeems some or all of the shares from the Fund within twelve
months of the time of purchase.
Sales charges on Fund shares may be reduced or eliminated in certain cases
(see Exhibit A to this Prospectus).
The sales charge is paid to CDI, which in turn normally reallows a portion to
your broker/dealer. Upon written notice to dealers with whom it has dealer
agreements, CDI may reallow up to the full applicable sales charge. Dealers to
whom 90% or more of the entire sales charge is reallowed may be deemed to be
underwriters under the Securities Act of 1933.
In addition to any sales charge reallowance or finder's fee, your
broker/dealer, or other financial service firm through which your account is
held, currently will be paid periodic service fees at an annual rate of up to
0.25% of the average daily net asset value of Fund shares held in accounts
maintained by that firm.
Distribution Plan
The Fund has adopted a Distribution Plan which provides for payments at a
maximum annual rate of 0.50% of the average daily net asset value of the Fund
shares to pay expenses associated with the distribution and servicing. Amounts
paid by the Fund to CDI under the Distribution Plan are used to pay to dealers
and others, including CDI salespersons who service accounts, service fees at
an annual rate of up to 0.25% of the average daily net asset value of Fund
shares, and to pay CDI for its marketing and distribution expenses, including,
but not limited to, preparation of advertising and sales literature and the
printing and mailing of prospectuses to prospective investors. During the
fiscal year ended September 30, 1997, distribution Plan expenses for the Fund
were 0.15%.
The Distribution Plan may be terminated at any time by vote of the Independent
Trustees or by vote of a majority of the outstanding voting shares of the
respective Fund. Payments pursuant to the Distribution Plan are included in
the operating expenses of the Fund.
Arrangements with Broker/Dealers and Others
CDI may also pay additional concessions, including non-cash promotional
incentives, such as merchandise or trips, to dealers employing registered
representatives who have sold or are expected to sell a minimum dollar amount
of shares of the Fund and/or shares of other Funds underwritten by CDI. CDI
may make expense reimbursements for special training of a dealer's registered
representatives, advertising or equipment, or to defray the expenses of sales
contests. All such payments will be in compliance with NASD rules. Payments
pursuant to a Distribution Plan are included in the operating expenses.
How to buy shares
Method New Accounts Additional Investments
By Mail $2,000 MINIMUM $250 MINIMUM
Please make your check Please make your check
payable to the Fund and payable to the Fund and
mail it with your mail it with your
application to: investment slip to:
Calvert Group Calvert Group
P.O. Box 419544 P.O. Box 419739
Kansas City, MO 64141-6544 Kansas City, MO 64141-6739
By Registered, CALVERT GROUP CALVERT GROUP
Certified, or C/O NFDS, 6TH FLOOR C/O NFDS, 6TH FLOOR
Overnight 1004 BALTIMORE 1004 BALTIMORE
Mail Kansas City, MO 64105-1807 Kansas City, MO 64105-1807
Through Your $2,000 MINIMUM $250 MINIMUM
Financial
Professional
AT THE CALVERT OFFICE
Visit the Calvert Office to make investments by check.
See the back cover page for the address.
FOR ALL OPTIONS BELOW, PLEASE CALL YOUR FINANCIAL PROFESSIONAL OR CALVERT
GROUP AT 800-368-2745
By Exchange $2,000 MINIMUM $250 MINIMUM
(From your account in another Calvert Group fund)
WHEN OPENING AN ACCOUNT BY EXCHANGE, YOUR NEW ACCOUNT MUST BE ESTABLISHED WITH
THE SAME NAME(S), ADDRESS AND TAXPAYER IDENTIFICATION NUMBER AS YOUR EXISTING
CALVERT ACCOUNT.
By Bank Wire $2,000 MINIMUM $250 MINIMUM
By Calvert Money NOT AVAILABLE $50 MINIMUM
Controller* FOR INITIAL
INVESTMENT
*Please allow sufficient time for Calvert Group to process your initial
request for this service, normally 10 business days. The maximum transaction
amount is $300,000, and your purchase request must be received by 4:00 p.m.
Eastern time.
NET ASSET VALUE
Net asset value per share ("NAV") refers to the worth of one share. NAV is
computed by adding the value of all portfolio holdings, plus other assets,
deducting liabilities and then dividing the result by the number of shares
outstanding. The NAV will vary daily based on the market values of the Fund's
investments.
Portfolio securities and other assets are valued based on market quotations,
except that securities maturing within 60 days are valued at amortized cost.
If quotations are not available, securities are valued by a method that the
Board of Trustees believes accurately reflects fair value.
The NAV for the Fund is calculated at the close of the Fund's business day,
which coincides with the closing of the regular session of the New York Stock
Exchange (normally 4:00 p.m. Eastern time). The Fund is open for business each
day the New York Stock Exchange is open. All purchases of Fund shares will be
confirmed and credited to your account in full and fractional shares (rounded
to the nearest 1/1000 of a share).
When Your Account Will Be Credited
Before you buy shares, please read the following information to make sure your
investment is accepted and credited properly
All of your purchases must be made in US dollars and checks must be drawn on
US banks. No cash 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. If your check is not paid, your purchase will be canceled and you will
be charged a $10 fee plus costs incurred by the Fund. When you purchase by
check or with Calvert Money Controller, those funds will be on hold for up to
10 business days from the date of receipt. During that period, the proceeds of
redemptions against those funds will be held until the transfer agent is
reasonably satisfied that the purchase payment has been collected. To avoid
this collection period, you can wire federal funds from your bank, which may
charge you a fee. As a convenience, check purchases can be received at
Calvert's offices for overnight mail delivery to the subtransfer agent and will
be credited the next business day or upon receipt. Any check purchase received
without an investment slip may cause delayed crediting.
Certain financial institutions or broker/dealers which have entered into a
sales agreement with the Distributor may enter confirmed purchase orders on
behalf of customers by phone, with payment to follow within a number of days
of the order as specified by the program. If payment is not received in the
time specified, the financial institution could be held liable for resulting
fees or losses.
Exchanges
You may exchange shares of the Fund for shares of other Calvert Group Funds.
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 on the
transaction.
If your investment goals change, the Calvert Group Family of Funds has a
variety of investment alternatives that includes common stock funds,
tax-exempt and corporate bond funds, and money market funds. The exchange
privilege is a convenient way to buy shares in other Calvert Group Funds in
order to respond to changes in your goals or in market conditions. However, to
protect a Fund's performance and to minimize costs, Calvert Group discourages
frequent exchanges and may prohibit additional purchases of Fund shares by
persons engaged in too many short-term trades. Before you make an exchange
from a Fund or Portfolio, please note the following:
o Call your broker or a Calvert representative for information and a
prospectus for any of Calvert's other Funds registered in your state. Read the
prospectus of the Fund or Portfolio into which you want to exchange for
relevant information, including class offerings.
o Complete and sign an application for an account in that Fund or
Portfolio, 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.
o You may exchange shares on which you have already paid a sales charge
at Calvert Group and shares acquired by reinvestment of dividends or
distributions into another Fund at no additional charge.
o Shareholders (and those managing multiple accounts) who make two
purchases and two exchange redemptions of shares of the same Portfolio during
any 6-month period will be given written notice that they may be prohibited
from making additional investments. This policy does not prohibit a
shareholder from redeeming shares of the Fund, and does not apply to trades
solely among money market funds.
o For purposes of the exchange privilege the Fund is related to Summit
Cash Reserves Fund by investment and investor services. The Fund reserves the
right to terminate or modify the exchange privilege with 60 days written
notice.
Other Calvert GROUP Services
Calvert Information Network
24 hour yield and prices.
Calvert Group has a round-the-clock telephone service and a website at
http://www.calvertgroup.com that lets existing customers obtain prices,
performance information, account balances, and, by telephone only, authorize
certain transactions.
Calvert Money Controller
Calvert Money Controller eliminates the delay of mailing a check or the
expense of wiring funds. You can request this free service on your application.
This service allows you to authorize electronic transfers of money to purchase
or sell shares. You use Calvert Money Controller like an "electronic check" to
move money ($50 to $300,000) between your bank account and your Calvert Group
account with one phone call. Allow one or two business days after the call for
the transfer to take place; for money recently invested, allow normal check
clearing time (up to 10 business days) before redemption proceeds are sent to
your bank.
You may also arrange systematic monthly or quarterly investments (minimum $50)
into your Calvert Group account. After you give us proper authorization, your
bank account will be debited to purchase Fund shares. A debit entry will
appear on your bank statement. Share purchases made through Calvert Money
Controller will be subject to the applicable sales charge. If you would like
to make arrangements for systematic monthly or quarterly redemptions from your
Calvert Group account, call your broker or Calvert Group for more information.
Telephone Transactions
Calvert may record all telephone calls.
If you have telephone transaction privileges, you may purchase, redeem, or
exchange shares, wire funds and use Calvert Money Controller by telephone. You
automatically have telephone privileges unless you elect otherwise. The Fund,
the transfer agent, the shareholder servicing agent and their affiliates are
not liable for acting in good faith on telephone instructions relating to your
account, so long as they follow reasonable procedures to determine that the
telephone instructions are genuine. Such procedures may include recording the
telephone calls and requiring some form of personal identification. You should
verify the accuracy of telephone transactions immediately upon receipt of your
confirmation statement.
Optional Services
Complete the account application for the easiest way to establish services.
The easiest way to establish optional services on your Calvert Group account
is to select the options you desire when you complete your account
application. If you wish to add other options later, you may have to provide
us with additional information and a signature guarantee. Please call Calvert
Investor Relations at 800-368-2745 for further assistance. For our mutual
protection, we may require a signature guarantee on certain written
transaction requests. A signature guarantee verifies the authenticity of your
signature, and may be obtained from any bank, savings and loan association,
credit union, trust company, broker/dealer firm or member of a domestic stock
exchange. A signature guarantee cannot be provided by a notary public.
Householding of General Mailings
Householding reduces Fund expenses while saving paper and postage expenses.
If you have multiple accounts with Calvert, you may receive combined mailings
of some shareholder information, such as statements, confirmations,
prospectuses, semi-annual and annual reports. Please contact Calvert Investor
Relations at 800-368-2745 to receive additional copies of information.
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 research fee for these special
services.
If you are purchasing shares of the Fund through a program of services offered
by a broker/dealer or financial institution, you should read the program
materials in conjunction with this Prospectus. Certain features may be
modified in these programs, and administrative charges may be imposed by the
broker/dealer or financial institution for the services rendered.
Tax-Saving Retirement Plans
Contact Calvert Group for complete information kits discussing the plans, and
their benefits, provisions and fees.
Calvert Group can set up your new account under one of several tax-deferred
plans. These plans let you invest for retirement and shelter your investment
income from current taxes. Minimums may differ from those listed in the "How
to Buy Shares" chart. Also, reduced sales charges may apply. See "Exhibit A -
Reduced Sales Charges."
o Traditional and Roth individual retirement accounts (IRAs):
available to anyone who has earned income. You may also be able to make
investments in the name of your spouse, if your spouse has no earned income.
o Qualified Profit-Sharing and Money Purchase Plans (including 401(k)
Plans): available to self-employed people and their partners, corporations
and their employees, and certain tax-exempt organizations.
o Simple IRA and Simplified Employee Pension Plan (SEP-IRA): available
to self-employed people and their partners, or to corporations.
o 403(b)(7) Custodial Accounts: available to employees of most
non-profit organizations and public schools and universities.
SELLING YOUR SHARES
You may redeem all or a portion of your shares on any business day. Your
shares will be redeemed at the next NAV calculated after your redemption
request is received and accepted. See the chart below for specific
requirements necessary to make sure your redemption request is acceptable.
Remember that the Fund may hold payment on the redemption of your shares until
it is reasonably satisfied that investments made by check or by Calvert Money
Controller have been collected (normally up to 10 business days).
Redemption Requirements To Remember
To ensure acceptance of your redemption request, please follow the procedures
described here and below
Once your shares are redeemed, 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. Calvert Money Controller
redemptions generally will be credited to your bank account on the second
business day after your phone call. When the New York Stock Exchange 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.
Minimum account balance is $1,000.
Please maintain a balance in your account of at least $1,000. If, due to
redemptions, the account falls below $1,000, or you fail to invest at least
$1,000, 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 after 30 days if the balance is not brought up to the required
minimum amount.
HOW TO SELL YOUR SHARES
By Mail To: Calvert Group, P.O. Box 419544 Kansas City, MO 64141-6544
You may redeem available shares from your account at any time by sending a
letter of instruction, including your name, account and Fund number, the
number of shares or dollar amount, and where you want the money to be sent.
Additional requirements, below, may apply to your account. The letter of
instruction must be signed by all required authorized signers. If you want the
money to be wired to a bank not previously authorized, then a voided bank
check must be enclosed with your letter. 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.
Type of Registration Requirements
Corporations, Letter of instruction and a corporate resolution,
Associations signed by person(s) authorized to act
on the account, accompanied signature guarantee(s).
Trusts Letter of instruction signed by the Trustee(s)
(as Trustee), with a signature guarantee.
(If the Trustee's name is not registered on your
account, provide a copy of the trust document,
certified within the last 60 days.)
By Telephone
Please call 800-368-2745. You may redeem shares from your account by telephone
and have your money mailed to your address of record or wired to a bank you
have previously authorized. A charge of $5 is imposed on wire transfers of
less than $1,000. See "Telephone Transactions."
Calvert Money Controller
Please allow sufficient time for Calvert Group to process your initial request
for this service (normally 10 business days). You may also authorize automatic
fixed amount redemptions by Calvert Money Controller. All requests must be
received by 4:00 p.m. Eastern time. Accounts cannot be closed by this service.
Exchange to Another Calvert Group Fund
You must meet the minimum investment requirement of the other Calvert Group
Fund or Portfolio. You can only exchange between accounts with identical
names, addresses and taxpayer identification number, unless previously
authorized with a signature-guaranteed letter.
Systematic Check Redemptions
If you maintain an account with a balance of $10,000 or more, you may have up
to two (2) regular checks for a fixed amount sent to you on the 15th of each
month simply by sending a letter with all the 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.
Through your Broker
If your account is held in your broker's name ("street name"), you should
contact your broker directly to transfer, exchange or redeem shares.
DIVIDENDS, CAPITAL GAINS AND TAXES
Each year, the Fund distributes substantially all of its net investment income
and capital gains to shareholders.
Dividends from the Fund's net investment income are declared and paid on a
monthly basis. Net investment income consists of the interest income, net
short-term capital gains, if any, and dividends declared and paid on
investments, less expenses. Distributions of the Fund's net short-term capital
gains (treated as dividends for tax purposes) and its net long-term capital
gains, if any, are normally declared and paid by the Fund 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 Payment Options
Dividends and any distributions are automatically reinvested in the same
Portfolio at NAV (no sales charge), unless you elect to have the dividends of
$10 or more paid in cash (by check or by Calvert Money Controller). Dividends
and distributions may be automatically invested in an identically registered
account with the same account number in any other Calvert Group Fund at NAV.
If reinvested in the same Fund account, new shares will be purchased at net
asset value on the reinvestment date, which is generally 1 to 3 days prior to
the payment date. You must notify the Fund in writing prior to the record date
to change your payment options. If you elect to have dividends and/or
distributions paid in cash, and the US Postal Service cannot deliver the
check, or if it remains uncashed for six months, 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 the Fund 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, the Fund's 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 capital gain distributions paid to you by the Fund
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 three months prior 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 Fund shares.
You may realize a capital gain or loss when you sell or exchange shares.
If you sell or exchange your Fund shares you will have a short or long-term
capital gain or loss, depending on how long you owned the shares which were
sold. In January, the Fund will mail you Form 1099-B indicating the date of
and proceeds from 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 the Fund to withhold 31% of your dividends and certain redemptions.
In addition, you may be subject to a fine. You will also be prohibited from
opening another account by exchange. If this TIN information is not received
within 60 days after your account is established, your account may be redeemed
at the current NAV on the date of redemption. The Fund reserves the right to
reject any new account or any purchase order for failure to supply a certified
TIN.
Exhibit A
REDUCED SALES CHARGES
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.
Right of Accumulation
The sales charge breakpoints are calculated by taking into account not only
the dollar amount of a new purchase of shares, but also the higher of cost or
current value of shares previously purchased in Calvert Group Funds that
impose sales charges. This automatically applies to your account for each new
purchase.
Letter of Intent
If you plan to purchase $50,000 or more of 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. 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.
Group Purchases
If you are a member of a qualified group, you may purchase shares of the Fund
at the reduced sales charge applicable to the group taken as a whole. The
sales charge is calculated by taking into account not only the dollar amount
of the shares you purchase, but also the higher of cost or current value of
shares previously purchased and currently held by other members of your group.
A "qualified group" is one which (i) has been in existence for more than six
months, (ii) has a purpose other than acquiring Fund shares at a discount, and
(iii) satisfies uniform criteria which enable CDI and dealers offering Fund
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 dealers distributing the Fund's
shares, must agree to include sales and other materials related to the Fund in
its publications and mailings to members at reduced or no cost to CDI or
dealers.
Pension plans may not qualify participants for group purchases; however, such
plans may qualify for reduced sales charges under a separate provision (see
below). Members of a group are not eligible for a Letter of Intent.
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)(7) of the Code if, at the time of purchase, Calvert Group
has been notified in writing that the 403(b)(7) plan has at least 200 eligible
employees. Furthermore, there is no sales charge on shares purchased for the
benefit of a retirement plan qualifying under Section 401(k) of the Code if, at
the time of such purchase, the 401(k) plan administrator has notified Calvert
Group in writing that a) its 401(k) plan has at least 200 eligible employees; or
b) the cost or current value of shares the plan has in Calvert Group of Funds
(except money market funds) is at least $1 million.
Neither the Fund, nor CDI, nor any affiliate thereof will reimburse a plan or
participant for any sales charges paid prior to receipt of 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 or portfolio 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 or portfolio, 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."
Established Accounts
Shares of Calvert Income Fund may be sold at net asset value to accounts
opened on or before January 12, 1987.
Dividends and Capital Gain Distributions from other Calvert Group Funds
You may prearrange to have your dividends and capital gain distributions from
another Calvert Group Fund automatically invested in another account with no
additional sales charge.
Purchases made at Net Asset Value ("NAV")
Except for money market funds, if you make a purchase at NAV, you may exchange
that amount to another fund at no additional sales charge.
Reinstatement Privilege
If you redeem Fund shares and then within 30 days decide to reinvest in the
same Fund, you may do so at the NAV 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.
Prospectus
January 31, 1998
CALVERT INCOME FUND
To Open an Account:
800-368-2748
Yields and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
Service for Existing Account:
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, 6th Floor
1004 Baltimore
Kansas City, MO 64105
Calvert Group Web Site:
http://www.calvertgroup.com
Principal Underwriter
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
<PAGE>
The Calvert Fund
Calvert Income Fund
Statement of Additional Information
January 31, 1998
INVESTMENT ADVISOR
Calvert Asset Management Company, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
SHAREHOLDER SERVICE TRANSFER AGENT
Calvert Shareholder Services, Inc. National Financial Data Services, Inc.
4550 Montgomery Avenue 1004 Baltimore
Suite 1000N 6th Floor
Bethesda, Maryland 20814 Kansas City, Missouri 64105
PRINCIPAL UNDERWRITER INDEPENDENT ACCOUNTANTS
Calvert Distributors, Inc. Coopers & Lybrand, L.L.P.
4550 Montgomery Avenue 250 West Pratt Street
Suite 1000N Baltimore, Maryland 21201
Bethesda, Maryland 20814
TABLE OF CONTENTS
Investment Objectives and Policies 1
Investment Restrictions 8
Dividends and Taxes 9
Calculation of Yield and Total Return 10
Net Asset Value 11
Purchase and Redemption of Shares 12
Reduced Sales Charges 12
Advertising 13
Trustees and Officers 13
Investment Advisor 16
Method of Distribution 16
Transfer and Shareholder Servicing
Agents 17
Portfolio Transactions 17
Independent Accountants and Custodians 17
General Information 18
Financial Statements 19
Control Persons and Principal Holders
of Securities 19
Appendix 20
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION January 31, 1998
THE CALVERT FUND
Calvert Income Fund
4550 Montgomery Avenue, Bethesda, Maryland 20814
New Account (800) 368-2748 Shareholder (800) 368-2745
Information: (301) 951-4820 Services: (301) 951-4810
Broker (800) 368-2746 TDD for the Hearing-
Services: (301) 951-4850 Impaired: (800) 541-1524
This Statement of Additional Information is not a prospectus.
Investors should read the Statement of Additional Information in conjunction
with the Fund's Prospectus dated January 31, 1998, which may be obtained free
of charge by writing the Fund at the above address or calling the Fund.
INVESTMENT OBJECTIVES AND POLICIES
As described in the Prospectus, Calvert Income Fund seeks to maximize
long-term income to the extent consistent with prudent investment management
and preservation of capital, through investment in bonds and other income
producing securities primarily of investment grade quality. The Fund may
invest in debt securities backed by the full faith and credit of the U.S.
Government, such as Government National Mortgage Association ("GNMA")
certificates, and may also invest in other debt securities such as
collateralized mortgage obligations. There can be, of course, no assurance
that the Fund will be successful in meeting its investment objective.
Collateralized Mortgage Obligations
The Fund may, in pursuit of its investment objectives, invest in
collateralized mortgage obligations. Collateralized mortgage obligations
("CMOs") are fully-collateralized bonds which are general obligations of the
issuer of the bonds. CMOs are not direct obligations of the U.S. Government.
CMOs generally are secured by collateral consisting of mortgages or a pool of
mortgages. The collateral is assigned to the trustee named in the indenture
pursuant to which the bonds are issued. Payments of principal and interest on
the underlying mortgages are not passed through directly to the holder of the
CMO; rather, payments to the trustee are dedicated to payment of interest on
and repayment of principal of the CMOs. This means that the character of
payments of principal and interest is not passed through, so that payments to
holders of CMOs attributable to interest paid and principal repaid on the
underlying mortgages or pool of mortgages do not necessarily constitute income
and return of capital, respectively, to the CMO holders. Also, because
payments of principal and interest are not passed through, CMOs secured by the
same pool or mortgages may be, and frequently are, issued with a variety of
classes or series, which have different maturities and are retired
sequentially. CMOs are designed to be retired as the underlying mortgages are
repaid. In the event of prepayment on such mortgages, the class of CMO first
to mature generally will be paid down. Thus there should be sufficient
collateral to secure the CMOs that remain outstanding even if the issuer does
not supply additional collateral.
FHLMC has introduced a CMO which is a general obligation of FHLMC.
This requires FHLMC to use its general funds to make payments on the CMO if
payments from the underlying mortgages are insufficient.
U.S. Government-Backed Obligations
The Fund may, in pursuit of its investment objective, invest in
Ginnie Maes, Fannie Maes, Freddie Macs, U.S. Treasury obligations, and other
U.S. Government-backed obligations.
Ginnie Maes. Ginnie Maes, issued by the Government National Mortgage
Association, are typically interests in pools of mortgage loans insured by the
Federal Housing Administration or guaranteed by the Veterans Administration. A
"pool" or group of such mortgages is assembled and, after approval from GNMA,
is offered to investors through various securities dealers. GNMA is a U.S.
Government corporation within the Department of Housing and Urban Development.
Ginnie Maes are backed by the full faith and credit of the United States,
which means that the U.S. Government guarantees that interest and principal
will be paid when due.
Fannie Maes and Freddie Macs. Fannie Maes and Freddie Macs are issued
by the Federal National Mortgage Association ("FNMA") and Federal Home Loan
Mortgage Corporation ("FHLMC"), respectively. Unlike GNMA certificates, which
are typically interests in pools of mortgages insured or guaranteed by
government agencies, FNMA and FHLMC certificates represent undivided interests
in pools of conventional mortgage loans. Both FNMA and FHLMC guarantee timely
payment of principal and interest on their obligations, but this guarantee is
not backed by the full faith and credit of the U.S. Government. FNMA's
guarantee is supported by its ability to borrow from the U.S. Treasury, while
FHLMC's guarantee is backed by reserves set aside to protect holders against
losses due to default.
U.S. Treasury Obligations. Direct obligations of the United States
Treasury are backed by the full faith and credit of the United States. They
differ only with respect to their rates of interest, maturities, and times of
issuance. U.S. Treasury obligations consist of: U.S. Treasury bills (having
maturities of one year or less), U.S. Treasury notes (having maturities of one
to ten years ) and U.S. Treasury bonds (generally having maturities greater
than ten years).
Other U.S. Government Obligations. The Fund may invest in other
obligations issued or guaranteed by the U.S. Government, its agencies, or its
instrumentalities. (Certain obligations issued or guaranteed by a U.S.
Government agency or instrumentality may not be backed by the full faith and
credit of the United States.)
Repurchase Agreements
The Fund may, in pursuit of its investment objectives, purchase
securities subject to repurchase agreements. Repurchase agreements are
transactions in which a person purchases a security and simultaneously commits
to resell that security to the seller at a mutually agreed upon time and
price. The seller's obligation is secured by the underlying security. The
repurchase price reflects the initial purchase price plus an agreed upon
market rate of interest. While an underlying security may bear a maturity in
excess of one year, the term of the repurchase agreement is always less than
one year. Repurchase agreements not terminable within seven days are
considered illiquid. Repurchase agreements are short-term money market
investments, designed to generate current income.
The Fund will only engage in repurchase agreements with recognized
securities dealers and banks determined to present minimal credit risk by the
Advisor.
The Fund will only engage in repurchase agreements reasonably
designed to secure fully during the term of the agreement the seller's
obligation to repurchase the underlying security and will monitor the market
value of the underlying security during the term of the agreement. If the
value of the underlying security declines and is not at least equal to the
repurchase price due to the Fund pursuant to the agreement, the Fund will
require the seller to pledge additional securities or cash to secure the
seller's obligations pursuant to the agreement. If the seller defaults on its
obligation to repurchase and the value of the underlying security declines,
the Fund may incur a loss and may incur expenses in selling the underlying
security.
Non-Investment Grade Debt Securities
The Fund may invest in lower quality debt securities (generally those
rated BB or lower by S&P or Ba or lower by Moody's), subject to the Fund's
investment policy, which provides that the Fund may not invest more than 35%
of its assets in securities rated below BBB or Baa by either rating service,
or in unrated securities determined by the Advisor to be comparable to
securities rated below BBB or Baa by either rating service. These securities
have moderate to poor protection of principal and interest payments and have
speculative characteristics. These securities involve greater risk of default
or price declines due to changes in the issuer's creditworthiness than
investment-grade debt securities. Because the market for lower-rated
securities may be thinner and less active than for higher-rated securities,
there may be market price volatility for these securities and limited
liquidity in the resale market. Market prices for these securities may decline
significantly in periods of general economic difficulty or rising interest
rates. Unrated debt securities may fall into the lower quality category.
Unrated securities usually are not attractive to as many buyers as rated
securities are, which may make them less marketable.
The quality limitation set forth in the Fund's investment policy is
determined immediately after the Fund's acquisition of a given security.
When purchasing high-yielding securities, rated or unrated, the
Advisor prepare its own careful credit analysis to attempt to identify those
issuers whose financial condition is adequate to meet future obligations or is
expected to be adequate in the future. Through portfolio diversification and
credit analysis, investment risk can be reduced, although there can be no
assurance that losses will not occur.
Options and Futures Contracts
Covered Options. The Fund may, in pursuit of its investment
objectives, engage in the writing of covered call options in standard
contracts traded on national securities exchanges or quoted on NASDAQ,
provided that: (1) the Fund continues to own the securities covering each call
option until the call option has been exercised or until the Fund has
purchased a closing call to offset its obligation to deliver securities
pursuant to the call option it had written; and (2) the market value of all
securities covering call options in the Fund does not exceed 35% of the market
value of the Fund's net assets. The Fund may also write secured put options
against U.S. Government-backed obligations and uses a variety of other
investment techniques, seeking to hedge against changes in the general level
of interest rates, including the purchase of put and call options on debt
securities and the purchase and sale of interest rate futures contracts and
options on such futures. The Fund will not engage in such transactions for the
purpose of speculation or leverage. Such investment policies and techniques
may involve a greater degree of risk than those inherent in more conservative
investment approaches.
The Fund will not engage in options or futures transactions unless it
receives appropriate regulatory approvals permitting the Fund to engage in
such transactions. The Fund observes the following operating policy, which may
be changed without the approval of a majority of the outstanding shares:
Purchase a futures contract or an option thereon if, with respect to positions
in futures or options on futures which do not represent bonafide hedging, the
aggregate initial margin and premiums on such options would exceed 5% of the
Fund's net asset value. (See non-fundamental investment restriction number 1.)
Covered Options on Debt Securities. The Fund may write "covered
options" on debt securities in standard contracts traded on national
securities exchanges and in the over-the-counter market. The Fund will write
such options in order to receive the premiums from options that expire and to
seek net gains from closing purchase transactions with respect to such options.
The Fund may write only "covered options." This means that, in the
case of call options, so long as the Fund is obligated as the writer of a call
option, it will own the underlying security subject to the option and, in the
case of put options, the Fund will, through its custodian, deposit and
maintain with a securities depository U.S. Treasury obligations with a market
value equal to or greater than the exercise price of the option.
Characteristics of Covered Options. When a Fund writes a covered call
option, the Fund gives the purchaser the right to purchase the security at the
call option price at any time during the life of the option. As the writer of
the option, the Fund receives a premium, less a commission, and in exchange
foregoes the opportunity to profit from any increase in the market value of
the security exceeding the call option price. The premium serves to mitigate
the effect of any depreciation in the market value of the security. Writing
covered call options can increase the income of the Fund and thus reduce
declines in the net asset value per share of the Fund if securities covered by
such options decline in value. Exercise of a call option by the purchaser
however will cause the Fund to forego future appreciation of the securities
covered by the option.
When the Fund writes a secured put option, it will gain a profit in
the amount of the premium, less a commission, so long as the price of the
underlying security remains above the exercise price. However, the Fund
remains obligated to purchase the underlying security from the buyer of the
put option (usually in the event the price of the security falls below the
exercise price) at any time during the option period. If the price of the
underlying security falls below the exercise price, the Fund may realize a
loss in the amount of the difference between the exercise price and the sale
price of the security, less the premium received.
The Fund purchases securities which may be covered with call options
solely on the basis of considerations consistent with the investment
objectives and policies of the Fund.
The Fund's turnover may increase through the exercise of a call
option; this will generally occur if the market value of a "covered" security
increases and the Fund has not entered into a closing purchase transaction.
Expiration of a put or call option or entry into a closing purchase
transaction will result in a short-term capital gain, unless the cost of a
closing purchase transaction exceeds the premium the Fund received when it
initially wrote the option, in which case a short-term capital loss will
result. If the purchaser exercises a put or call option, the Fund will realize
a gain or loss from the sale of the security acquired or sold pursuant to the
option, and in determining the gain or loss the premium will be included in
the proceeds of sale. To preserve the Fund's status as a regulated investment
company under Subchapter M of the Internal Revenue Code, it is the Fund's
policy to limit any gains on put or call options and other securities held
less than three months to less than 30% of the Fund's annual gross income.
Risks Related to Options Transactions. The Fund can close out its
positions in exchange traded options only on an exchange which provides a
secondary market in such options. Although the Fund intends to acquire and
write only such exchange-traded options for which an active secondary market
appears to exist, there can be no assurance that such a market will exist for
any particular option contract at any particular time. It is difficult to
accurately predict the extent of trading interest that may develop with
respect to such options. This might prevent a Fund from closing an options
position, which could impair the Fund's ability to hedge its portfolio
effectively. Also, a Fund's inability to close out a call position may have an
adverse effect on its liquidity because the Fund may be required to hold the
securities underlying the option until the option expires or is exercised.
The hours of trading for options on U.S. Government securities may
not correspond exactly to the hours of trading for the underlying securities.
To the extent that the options markets close before the U.S. Government
securities markets, significant movements in rates and prices may occur in the
Government securities markets that cannot be reflected in the options markets.
Interest Rate Futures Transactions. A change in the general level of
interest rates will affect the market value of debt securities in a Fund's
portfolio. The Fund may purchase and sell interest rate futures contracts
("futures contracts") as a hedge against changes in interest rates in
accordance with the strategies described below. A futures contract is an
agreement between two parties to buy and sell a security on a future date
which has the effect of establishing the current price for the security.
Although futures contracts by their terms require actual delivery and
acceptance of securities, in most cases the contracts are closed out before
the settlement date without the making or taking of delivery of securities.
Upon purchasing or selling a futures contract, the Fund deposits initial
margin with its custodian, and thereafter daily payments of maintenance margin
are made to and from the executing broker. Payments of maintenance margin
reflect changes in the value of the futures contract, with the Fund being
obligated to make such payments if its futures position becomes less valuable
and entitled to receive such payments if its position becomes more valuable.
Futures contracts have been designed by boards of trade which have
been designated "contract markets" by the Commodity Futures Trading Commission
("CFTC"). As a series of a registered investment company, the Fund is eligible
for exclusion from the CFTC's definition of "commodity pool operator," meaning
that the Fund may invest in futures contracts under specified conditions
without registering with the CFTC. Futures contracts trade on contract markets
in a manner that is similar to the way a stock trades on a stock exchange, and
the boards of trade, through their clearing corporations, guarantee
performance of the contracts.
The purchase and sale of futures contracts is for the purpose of
hedging the Fund's holdings of long-term debt securities. Futures contracts
based on U.S. Government securities and GNMA Certificates historically have
reacted to an increase or decrease in interest rates in a manner similar to
the manner in which mortgage-related securities reacted to the change. If
interest rates increase, the value of such securities in the Fund's portfolio
would decline, but the value of a short position in futures contracts would
increase at approximately the same rate, thereby keeping the net asset value
of the Fund from declining as much as it otherwise would have. Thus, if a Fund
owns long-term securities and interest rates were expected to increase, it
might sell futures contracts rather than sell its holdings of long-term
securities. If, on the other hand, the Fund held cash reserves and interest
rates were expected to decline, the Fund might enter into futures contracts
for the purchase of U.S. Government securities or GNMA certificates and thus
take advantage of the anticipated risk in the value of long-term securities
without actually buying them until the market had stabilized. At that time,
the futures contracts could be liquidated and the Fund's cash reserves could
then be used to buy long-term securities in the cash market. The Fund could
accomplish similar results by selling securities with long maturities and
investing in securities with short maturities when interest rates are expected
to increase or by buying securities with long maturities and selling
securities with short maturities when interest rates are expected to decline.
But by using futures contracts as an investment tool to manage risk it might
be possible to accomplish the same result easily and quickly.
Options on Futures Contracts. The Fund may purchase and write call
and put options on futures contracts which are traded on a U.S. exchange or
board of trade and enter into closing transactions with respect to such
options to terminate an existing position. An option on a futures contract
gives the purchaser the right, in return for the premium paid, to assume a
position in a futures contract-a long position if the option is a call and a
short position if the option is a put-at a specified exercise price at any
time during the period of the option. The Fund will pay a premium for such
options which it purchases. In connection with such options which it writes,
the Fund will make initial margin deposits and make or receive maintenance
margin payments which reflect changes in the market value of such options.
This arrangement is similar to the margin arrangements applicable to futures
contracts described above.
Purchase of Put Options on Futures Contracts. The purchase of put
options on futures contracts is analogous to the sale of futures contracts and
is used to protect the Fund's portfolio of debt securities against the risk of
declining prices.
Purchase of Call Options on Futures Contracts. The purchase of call
options on futures contracts represents a means of obtaining temporary
exposure to market appreciation at limited risk. It is analogous to the
purchase of a futures contract and is used to protect against a market advance
when the Fund is not fully invested.
Writing Call Options on Futures Contracts. The writing of call
options on futures contracts constitutes a partial hedge against declining
prices of the debt securities which are deliverable upon exercise of the
futures contracts. If the futures contract price at expiration is below the
exercise price, the Fund will retain the full amount of the option premium
which provides a partial hedge against any decline that may have occurred in
the Fund's holdings of debt securities.
Writing Put Options on Futures Contracts. The writing of put options
on futures contracts is analogous to the purchase of futures contracts. If an
option is exercised, the net cost to the Fund of the debt securities acquired
by it will be reduced by the amount of the option premium received. Of course,
if market prices have declined, the Fund's purchase price upon exercise may be
greater than the price at which the debt securities might be purchased in the
cash market.
Risks of Options and Futures Contracts. If the Fund has sold futures
or takes options positions to hedge its portfolio against decline in the
market and the market later advances, the Fund may suffer a loss on the
futures contracts or options which it would not have experienced if it had not
hedged. The success of a hedging strategy depends on the Advisor's ability to
predict the direction of interest rates and other economic factors.
Correlation is imperfect between movements in the prices of futures or options
contracts and movements in prices of the securities which are the subject of
the hedge. Thus, the price of the futures contract or option may move more
than or less than the price of the securities being hedged. If a Fund used a
futures or options contract to hedge against a decline in the market, and the
market later advances (or vice versa), the Fund may suffer a greater loss than
if it had not hedged.
A Fund can close out its futures positions only on an exchange or
board of trade which provides a secondary market in such futures. Although the
Fund intends to purchase or sell only such futures for which an active
secondary market appears to exist, there can be no assurance that such a
market will exist for any particular futures contract at any particular time.
This might prevent the Fund from closing a futures position, which could
require the Fund to make daily cash payments with respect to its position in
the event of adverse price movements. In such situations, if the Fund has
insufficient cash, it may have to sell portfolio securities to meet daily
margin requirements at a time when it would be disadvantageous to do so. The
inability to close futures or options positions could have an adverse effect
on the Fund's ability to hedge effectively. There is also risk of loss by the
Fund of margin deposits in the event of bankruptcy of a broker with whom the
Fund has an open position in a futures contract. To partially or completely
offset losses on futures contracts, the Fund will normally hold the securities
against which the futures positions were taken until the futures positions can
be closed out, so that the Fund receives the gain (if any) from the portfolio
securities. This might have an adverse effect on the Fund's overall liquidity.
Options on futures transactions bear several risks apart from those
inherent in options transactions generally. A Fund's ability to close out its
options positions in futures contracts will depend upon whether an active
secondary market for such options develops and is in existence at the time the
Fund seeks to close its position. There can be no assurance that such a market
will develop or exist. Therefore, the Fund might be required to exercise the
options to realize any profit.
NONDIVERSIFIED STATUS
The Fund is a "nondiversified" investment company under the
Investment Act of 1940 (the "Act"), which means the Fund is not limited by the
Act in the proportion of its assets that may be invested in the securities of
a single issuer. A nondiversified fund may invest in a smaller number of
issuers than a diversified fund. Thus, an investment in the Fund may, under
certain circumstances, present greater risk of loss to an investor than an
investment in a diversified fund. However, the Fund intends to conduct its
operations so as to qualify to be taxed as a "regulated investment company"
for purposes of the Code, which will relieve the Fund of any liability for
federal income tax to the extent its earnings are distributed to shareholders.
To qualify for this Subchapter M tax treatment, the Fund will limit its
investments to satisfy the Code diversification requirements so that, at the
close of each quarter of the taxable year, (i) not more than 25% of the fund's
assets will be invested in the securities of a single issuer or of two or more
issuers which the Fund controls and which are determined to be engaged in the
same or similar trades or businesses or related trades or businesses, and (ii)
with respect to 50% of its assets, not more than 5% of its assets will be
invested in the securities of a single issuer and the Fund will not own more
than 10% of the outstanding voting securities of a single issuer. Investments
in United States Government securities are not subject to these limitations;
while securities issued or guaranteed by foreign governments are subject to
the above tests in the same manner as the securities of non-governmental
issuers. The Fund intends to comply with the SEC staff position that
securities issued or guaranteed as to principal and interest by any single
foreign government are considered to be securities of issuers in the same
industry.
RESTRICTED SECURITIES
Calvert Income Fund may invest in restricted (privately placed)
securities and other securities which are not readily marketable. Such
securities may offer greater potential for capital appreciation or income than
non-restricted securities. The Fund may not invest in such securities if, at
the time of acquisition, such investment would cause the total percentage of
illiquid securities in the Fund to exceed 15% of its total assets.
Restricted securities may be sold only in privately negotiated
transactions, in a public offering for which a registration statement is in
effect under the Securities Act of 1933 (the "Act") or, where applicable,
pursuant to Rule 144A of the Act. If registration is required to effect sales
of the security the Fund may be obligated to bear all or part of the
registration expenses and wait until the appropriate registration statement
becomes effective before it makes the sale. If adverse market conditions
develop during such a period, the Fund may not be able to obtain as favorable
a price as that prevailing when it decided to sell. The Fund's investments in
restricted securities are valued at fair value as determined by the Advisor
under the supervision of the Board of Trustees. In determining fair value, the
market price of comparable securities, if any, the book value per share, and
other intrinsic financial information regarding the issuer and the securities
will be taken into consideration. If, as a result of the appreciation in value
of restricted securities or the depreciation in value of unrestricted
securities, either Fund's proportion of such assets should exceed 15% of the
value of its assets, the Board will take appropriate steps to protect
liquidity.
Loans of Portfolio Securities
The Fund may lend the securities from its portfolio to member firms
of the New York Stock Exchange and commercial banks with assets of one billion
dollars or more. Any such loans must be secured continuously in the form of
cash or cash equivalents such as U.S. Treasury bills, the amount of collateral
must on a current basis equal or exceed the market value of the loaned
securities, and the Fund must be able to terminate such loans upon notice, at
any time. The Fund will exercise its right to terminate a securities loan in
order to preserve its right to vote upon matters of importance affecting
holders of the securities. The Fund may make loans of its securities only if
the value of the securities loaned from the Fund will not exceed one-third of
the Fund's assets.
The advantage of such loans is that the Fund continues to receive the
equivalent of the interest earned or dividends paid by the issuer on the
loaned securities while at the same time earning interest on the cash or
equivalent collateral which may be invested in accordance with the Fund's
investment objective, policies and restrictions.
Securities loans are usually made to broker-dealers and other
financial institutions to facilitate their deliveries of such securities. As
with any extension of credit there may be risks of delay in recovery and
possibly loss of rights in the loaned securities should the borrower of the
loaned securities fail financially. However, the Fund will make loans of its
portfolio securities only to those firms the Advisor deems creditworthy and
only on such terms as the Advisor believes should compensate for such risk. On
termination of the loan the borrower is obligated to return the securities to
the Fund; any gain or loss in the market value of the security during the loan
period will inure to the Fund. The Fund may pay reasonable custodial fees in
connection with the loan.
International Money Market Instruments
Calvert Income Fund may, in pursuit of its investment objective,
invest in U.S. dollar-denominated obligations of foreign branches of U.S.
banks and U.S. branches of foreign banks. Such obligations are not insured by
the Federal Deposit Insurance Corporation. Foreign and domestic bank reserve
requirements may differ. Payment of interest and principal upon these
obligations and the marketability and liquidity of such obligations in the
secondary market may also be affected by governmental action in the country of
domicile of the branch (generally referred to as "sovereign risk"). Examples
of governmental actions would be the imposition of exchange or currency
controls, interest limitations or withholding taxes on interest income,
seizure of assets, or the declaration of a moratorium on the payment of
principal or interest. In addition, evidences of ownership of portfolio
securities may be held outside of the U.S., and the Fund may be subject to the
risks associated with the holding of such property overseas.
The obligations of foreign branches of U.S. banks and of U.S.
branches of foreign banks may be general obligations of the parent bank in
addition to being obligations of the issuing branch, or may be limited to
being an obligation of the issuing branch by the terms of the specific
obligation or by government action or regulation. Obligations which are
limited to being obligations of the issuing branch may involve greater risks
than obligations which are generally obligations of the parent bank in
addition to being obligations of the issuing branch.
The Fund will carefully consider these factors in making such
investments and will invest no more than 25% of the value of its assets in
U.S. dollar-denominated obligations of foreign branches of U.S. banks and U.S.
branches of foreign banks.
Corporate Bond Ratings:
Description of Moody's Investors Service Inc.'s/Standard & Poor's bond ratings:
Aaa/AAA: Best quality. These bonds carry the smallest degree of
investment risk and are generally referred to as "gilt edge." Interest
payments are protected by a large or by an exceptionally stable margin and
principal is secure. This rating indicates an extremely strong capacity to pay
principal and interest.
Aa/AA: Bonds rated AA also qualify as high-quality debt obligations.
Capacity to pay principal and interest is very strong, and in the majority of
instances they differ from AAA issues only in small degree. They are rated
lower than the best bonds because margins of protection may not be as large as
in Aaa securities, fluctuation of protective elements may be of greater
amplitude, or there may be other elements present which make long-term risks
appear somewhat larger than in Aaa securities.
A/A: Upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which make the bond somewhat more susceptible to the adverse effects of
circumstances and economic conditions.
Baa/BBB: Medium grade obligations; adequate capacity to pay principal
and interest. Whereas they normally exhibit adequate protection parameters,
adverse economic conditions or changing circumstances are more likely to lead
to a weakened capacity to pay principal and interest for bonds in this
category than for bonds in higher rated categories.
Ba/BB, B/B, Caa/CCC, Ca/CC: Debt rated in these categories is
regarded as predominantly speculative with respect to capacity to pay interest
and repay principal. The higher the degree of speculation, the lower the
rating. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposure to adverse conditions.
C/C: This rating is only for income bonds on which no interest is
being paid.
D: Debt in default; payment of interest and/or principal is in
arrears.
Commercial Paper Ratings:
MOODY'S INVESTORS SERVICE, INC.:
The Prime rating is the highest commercial paper rating assigned by
Moody's. Among the factors considered by Moody's in assigning ratings are the
following: (1) evaluation of the management of the issuer; (2) economic
evaluation of the issuer's industry or industries and an appraisal of
speculative-type risks which may be inherent in certain areas; (3) evaluation
of the issuer's products in relation to competition and customer acceptance;
(4) liquidity; (5) amount and quality of long-term debt; (6) trend of earnings
over a period of ten years; (7) financial strength of a parent company and the
relationships which exist with the issuer; and (8) recognition by management
of obligations which may be present or may arise as a result of public
interest questions and preparations to meet such obligations. Issuers within
this Prime category may be given ratings 1, 2, or 3, depending on the relative
strengths of these factors.
STANDARD & POOR'S CORPORATION:
Commercial paper rated A by Standard & Poor's has the following
characteristics: (i) liquidity ratios are adequate to meet cash requirements;
(ii) long-term senior debt rating should be A or better, although in some
cases BBB credits may be allowed if other factors outweigh the BBB; (iii) the
issuer should have access to at least two additional channels of borrowing;
(iv) basic earnings and cash flow should have an upward trend with allowances
made for unusual circumstances; and (v) typically the issuer's industry should
be well established and the issuer should have a strong position within its
industry and the reliability and quality of management should be unquestioned.
Issuers rated A are further referred to by use of numbers 1, 2 and 3 to denote
the relative strength within this highest classification.
INVESTMENT RESTRICTIONS
The Fund has adopted the following investment restrictions and
fundamental policies. These restrictions cannot be changed without the
approval of the holders of a majority of the outstanding shares of the Fund.
As defined in the Investment Company Act of 1940, this means the lesser of the
vote of (a) 67% of the shares of the Fund at a meeting where more than 50% of
the outstanding shares are present in person or by proxy or (b) more than 50%
of the outstanding shares of the Fund. Shares have equal rights as to voting,
except that only shares of a series are entitled to vote on matters, such as
changes in investment objective, policies or restrictions, affecting only that
series.
The Fund may not:
(1) Concentrate 25% or more of the value of its assets in any
one industry; provided, however, that there is no limitation with respect to
investments in obligations issued or guaranteed by the United States
Government or its agencies and instrumentalities.
(2) With respect to 75% of the Fund's assets, purchase more than
10% of the outstanding voting securities of any issuer. In addition, all
series of the Calvert Fund may not together purchase more than 10% of the
outstanding voting securities of any issuer.
(3) Make loans (other than loans of its portfolio securities,
loans through the purchase of money market instruments and repurchase
agreements, or loans through the purchase of goods, debentures or other debt
securities of the types commonly offered privately and purchased by financial
institutions). The purchase of a portion of an issue of publicly distributed
debt obligations shall not constitute the making of loans.
(4) Underwrite the securities of other issuers.
(5) Purchase from or sell to any of the Funds Officers or
Trustees, or firms of which any of them are members, any securities (other
than capital stock of the Fund), but such persons or firms may act as brokers
for the Fund.
(6) Issue senior securities or borrow money except from banks as
a temporary measure for extraordinary or emergency purposes and then only in
an amount up to 10% of the value of its total assets in order to meet
redemption requests without immediately selling portfolio securities. The
writing of covered call options is not considered issuing a senior security.
In order to secure any such borrowing under this section, the Fund may pledge,
mortgage or hypothecate its assets and then in an amount not greater than 15%
of the value of its total assets. The Fund will not borrow for leverage
purposes and investment securities will not be purchased while any borrowings
are outstanding.
(7) Purchase or retain the securities of any issuer if any
Officer or Trustee of the Fund or its Investment Adviser owns beneficially
more than 1/2 of 1% of the securities of such issuer or if together such
individuals own more than 5% of the securities of such issuer.
(8) Invest in interests in oil, gas, or other mineral,
exploration or development programs, although it may invest in securities of
issuers which invest in or sponsor such programs.
(9) Purchase the securities of other investment companies,
except as they may be acquired as part of a merger, consolidation or
acquisition of assets, or in connection with a trustee's/director's deferred
compensation plan, as long as there is no duplication of advisory fees.
(10) Purchase the securities of companies which have a record of
less than three years' continuous operation if, as a result, more than 5% of
the value of the Fund's total assets would be invested in securities of such
issuer.
(11) Purchase or sell physical commodities except that it may
enter into futures contracts and options thereon.
(12) Invest in real estate, although it may invest in securities
which are secured by real estate or real estate mortgages and may invest in
the securities of issuers which invest or deal in real estate or real estate
mortgages.
NONFUNDAMENTAL INVESTMENT RESTRICTIONS
The Fund has adopted the following operating (i.e., non-fundamental)
investment policies and restrictions which may be changed by the Board of
Trustees without shareholder approval. The Fund may not:
(1) Purchase a futures contract or an option thereon if, with
respect to positions in futures or options on futures which do not represent
bonafide hedging, the aggregate initial margin and premiums on such options
would exceed 5% of the Fund's net asset value.
(2) Invest in puts, calls, straddles, spread, or any
combination thereof, except to the extent permitted by the Prospectus and
Statement of Additional Information, as each may from time to time be amended.
(3) Effect short sales or securities, except (a) if it owns or
has the right to obtain securities equivalent in kind and amount to the
securities sold short, or (b) it may effect short sales of U.S. Treasury
securities for the limited purpose of hedging the duration of the Fund's
portfolio. For purposes of this restriction, transactions in futures contracts
and options are not deemed to constitute selling securities short.
(4) Purchase securities on margin, except (1) for use of
short-term credit necessary for clearance of purchases and sales of portfolio
securities and (2) it may make margin deposits in connection with futures
contracts or options on futures or other permissible investments.
(5) Invest more than 35% of its net assets in non-investment
grade debt securities.
(6) Invest more than 20% of its assets in the securities of
foreign issuers.
(7) Purchase illiquid securities if, as a result, more than 15%
of its net assets would be invested in such securities.
(8) With respect to 50% of the Funds assets, purchase securities
of any issuer (other than obligations of, or guaranteed by, the United States
Government, its agencies or instrumentalities) if, as a result, more than 5%
of the value of the Fund's total assets would be invested in securities of
such issuer.
Any investment restriction which involves a maximum percentage of
securities or assets shall not be considered to be violated unless an excess
over the applicable percentage occurs immediately after and results from an
acquisition of securities or utilization of assets.
DIVIDENDS AND TAXES
The Fund declares and pay dividends from net investment income on a
monthly basis. Net investment income consists of the interest income earned
(adjusted for amortization of original issue or market discounts or premiums)
and dividends declared and paid on investments, less expenses. Distributions
of net capital gains, if any, are normally declared and paid by the Fund once
a year; however, the Fund does not intend to make any such distributions from
securities profits unless available capital loss carryovers, if any, have been
used or have expired. Dividends and distributions paid may differ among the
classes.
Under the backup withholding provisions of the Interest and Dividend
Tax Compliance Act of 1983, the Fund is required to withhold 31% of any
dividends and capital gains distributions, and 31% of each redemption
transaction, if: (a) the shareholder's social security number or other
taxpayer identification number ("TIN") is not provided or an obviously
incorrect TIN is provided; (b) the shareholder does not certify under
penalties of perjury that the TIN provided is the shareholder's correct TIN
and that the shareholder is not subject to backup withholding under section
3406(a)(1)(C) of the Internal Revenue Code because of underreporting (however,
failure to provide certification as to the application of section
3406(a)(1)(C) will result only in backup withholding on dividends, not on
redemptions); or (c) the Fund is notified by the Internal Revenue Service that
the TIN provided by the shareholder is incorrect or that there has been
underreporting of interest or dividends by the shareholder. Affected
shareholders will receive statements at least annually specifying the amount
withheld.
In addition, the Fund is required under the broker reporting
provisions of the Tax Equity and Fiscal Responsibility Act of 1982 to report
to the Internal Revenue Service the following information with respect to each
redemption transaction: (a) the shareholder's name, address, account number
and taxpayer identification number; (b) the total dollar value of the
redemptions; and (c) the Fund's identifying CUSIP number.
Certain shareholders are, however, exempt from the backup withholding
and broker reporting requirements. Exempt shareholders include corporations;
financial institutions; tax-exempt organizations; individual retirement plans;
the U.S., a State, the District of Columbia, a U.S possession, a foreign
government, an international organization, or any political subdivision,
agency or instrumentality of any of the foregoing; U.S. registered commodities
or securities dealers; real estate investment trusts; registered investment
companies; bank common trust funds; certain charitable trusts; foreign central
banks of issue. Non-resident aliens also are generally not subject to either
requirement but, along with certain foreign partnerships and foreign
corporations, may instead be subject to withholding under Section 1441 of the
Internal Revenue Code. Shareholders claiming exemption from backup withholding
and broker reporting should call or write the Fund for further information.
Dividends and distributions are automatically reinvested at net asset
value in additional shares. Shareholders may elect to have their dividends and
distributions paid out in cash, or invested at net asset value in another
Calvert Group Fund.
Distributions from realized net short-term capital gains, as well as
dividends from net investment income, are currently taxable to shareholders as
ordinary income.
Net long-term capital gains distributions, if any, will generally be
includable as long-term capital gain in the gross income of shareholders who
are citizens or residents of the United States. Whether such realized
securities gains and losses are long-term or short-term depends on the period
the securities are held by the Fund, not the period for which the shareholder
holds shares of the Fund.
Dividends and distributions are taxable regardless of whether they
are reinvested in additional shares of a Fund or not. A shareholder may also
be subject to state and local taxes on dividends and distributions from the
Fund. The Fund will notify shareholders each January as to the federal tax
status of dividends and distributions paid by the Fund and the amount of
dividends withheld, if any, during the previous fiscal year.
CALCULATION OF YIELD AND TOTAL RETURN
YIELD
The Fund may advertise its "yield" from time to time. Yield
quotations are historical, and are not intended to indicate future
performance. "Yield" quotations refer to the aggregate imputed
yield-to-maturity of each of the Fund's investments based on the market value
as of the last day of a given thirty-day or one-month period, less accrued
expenses (net of reimbursement), divided by the average daily number of
outstanding shares which are entitled to receive dividends, times the maximum
offering price on the last day of the period (so that the effect of the sales
charge is included in the calculation), compounded on a "bond equivalent," or
semi-annual, basis. The Fund's yield is computed according to the following
formula:
Yield = 2[(a-b/cd +1)6 - 1]
where a = dividends and interest earned during the period using the aggregate
imputed yield-to-maturity for each of the Fund's investments as noted above; b
= expenses accrued for the period (net of reimbursement, if any); c = the
average daily number of shares outstanding during the period that were
entitled to receive dividends; and d = the maximum offering price per share on
the last day of the period. Using this calculation, the Fund's yield for the
month ended September 30, 1997 was 4.72%.
Yield will fluctuate in response to changes in interest rates and
general economic conditions, portfolio quality, portfolio maturity, and
operating expenses. Yield is not fixed or insured and therefore is not
comparable to a savings or other similar type of account. Yield during any
particular time period should not be considered an indication of future yield.
It is, however, useful in evaluating the Fund's performance in meeting its
investment objective.
TOTAL RETURN
The Fund may also advertise "total return." Total return is computed
by taking the total number of shares purchased by a hypothetical $1,000
investment after deducting any applicable sales charge, adding all additional
shares purchased within the period with reinvested dividends and
distributions, calculating the value of those shares at the end of the period,
and dividing the result by the initial $1,000 investment. For periods of more
than one year, the cumulative total return is then adjusted for the number of
years, taking compounding into account, to calculate average annual total
return during that period.
Total return is computed according to the following formula:
P(1 + T)n = ERV
In the above formula P = a hypothetical initial payment of $1,000
(less the maximum sales charge imposed during the period calculated); T =
total return; n = number of years, and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period.
Total return is historical in nature and is not intended to indicate
future performance. All total return quotations reflect the deduction of the
Fund's maximum sales charge "return with maximum load," except quotations of
"return without maximum load" which do not deduct sales charge. Thus, in the
above formula, for total return, P = the entire $1,000 hypothetical initial
investment and does not reflect the deduction of any sales charge; for actual
return, P = a hypothetical initial payment of $1,000 less any sales charge
actually imposed at the beginning of the period for which the performance is
being calculated. Return figures should be considered only by investors that
qualify for a reduced sales charge or no sales charge, such as participants in
certain pension plans, to whom the sales charge does not apply. Return figures
may also be considered for purposes of comparison only with comparable figures
which also do not reflect sales charges, such as Lipper averages.
Total returns for the Fund's shares for the periods indicated are as
follows:
Periods Ended Calvert Income Calvert Income
September 30, 1997 w/o Max Load Average Annual Return
with Maximum Load
One Year 11.03% 7.00%
Five Years 6.69% 5.88%
Ten Years 9.41% 8.99%
NET ASSET VALUE
The net asset value per share of the Fund, the price at which shares
are redeemed, is determined every business day as of 4:00 p.m., Eastern time,
and at such other times as may be appropriate or necessary. The Fund does not
determine net asset value on certain national holidays or other days on which
the New York Stock Exchange is closed: New Year's Day, Martin Luther King Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day, and Christmas Day.
The Fund's net asset value per share is computed separately for each
class by dividing the value of its total assets, less its liabilities, by the
total number of shares outstanding. Portfolio securities are valued as
follows: (a) securities for which market quotations are readily available are
valued at the most recent closing price, mean between bid and asked price, or
yield equivalent as obtained from one or more market makers for such
securities; (b) securities maturing within 60 days are valued at cost, plus or
minus any amortized discount or premium, unless the Board of Trustees
determines such method not to be appropriate under the circumstances; and (c)
all other securities and assets for which market quotations are not readily
available are fairly valued by the Advisor in good faith under the supervision
of the Board of Trustees.
Net Asset Value and Offering Price Per Share
Net asset value per share
($39,302,110/2,285,465 shares) $17.20
Maximum sales charge
(3.75% of offering price) 0.67
Offering price per share $17.87
PURCHASE AND REDEMPTION OF SHARES
Share certificates will not be issued unless requested in writing by
the investor. No charge will be made for share certificate requests. No
certificates will be issued for fractional shares.
Amounts redeemed by check redemption may be mailed to the investor
without charge. Amounts of more than $50 and less than $300,000 may be
transferred electronically at no charge to the investor. Amounts of $1,000 or
more will be transmitted by wire without charge by the Fund to the investor's
account at a domestic commercial bank that is a member of the Federal Reserve
System or to a correspondent bank. A charge of $5 is imposed on wire transfers
of less than $1,000. If the investor's bank is not a Federal Reserve System
member, failure of immediate notification to that bank by the correspondent
bank could result in a delay in crediting the funds to the investor's bank
account.
Telephone redemption requests which would require the redemption of
shares purchased by check or electronic funds transfer within the previous 10
business days may not be honored. The Fund reserves the right to modify the
telephone redemption privilege.
Existing shareholders who at any time desire to arrange for the
telephone redemption procedure, or to change instructions already given, must
send a written notice either to the broker through which the shares were
purchased or to the Fund with a voided check from the bank account to receive
the redemption proceeds. New wiring instructions may be accompanied by a
voided check in lieu of a signature guarantee. Further documentation may be
required from corporations, fiduciaries, pension plans, and institutional
investors.
The Fund's redemption check normally will be mailed to the investor
on the next business day following the date of receipt by the Fund of the
written or telephone redemption request. If the investor so instructs in the
redemption request, the check will be mailed or the redemption proceeds wired
to a predesignated account at the investor's bank. Redemption proceeds are
normally paid in cash. However, at the sole discretion of the Fund, 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 Fund, whichever is less, or as allowed by law.
The right of redemption of Fund shares may be suspended or the date
of payment postponed for any period during which the New York Stock Exchange
is closed (other than customary weekend and holiday closings), when trading on
the New York Stock Exchange is restricted, or an emergency exists, as
determined by the Securities and Exchange Commission, or if the Commission has
ordered such a suspension for the protection of shareholders. Redemption
proceeds are normally mailed or wired the next business day but in no event
later than seven days after a proper redemption request has been received,
unless redemptions have been suspended or postponed as described above.
REDUCED SALES CHARGES
The Fund imposes reduced sales charges in certain situations in which
the Principal Underwriter and the dealers selling Fund shares may expect to
realize significant economies of scale with respect to such sales. Generally,
sales costs do not increase in proportion to the dollar amount of the shares
sold; the per-dollar transaction cost for a sale to an investor of shares
worth, say, $5,000 is generally much higher than the per-dollar cost for a
sale of shares worth $1,000,000. Thus, the applicable sales charge declines as
a percentage of the dollar amount of shares sold as the dollar amount
increases.
When a shareholder agrees to make purchases of shares over a period
of time totaling a certain dollar amount pursuant to a Letter of Intent, the
Underwriter and selling dealers can expect to realize the economies of scale
applicable to that stated goal amount. Thus the Fund imposes the sales charge
applicable to the goal amount. Similarly, the Underwriter and selling dealers
also experience cost savings when dealing with existing Fund shareholders,
enabling the Fund to afford existing shareholders the Right of Accumulation.
The Underwriter and selling dealers can also expect to realize economies of
scale when making sales to the members of certain qualified groups which agree
to facilitate distribution of Fund shares to their members. See "Exhibit A -
Reduced Sales Charges" in the Prospectus.
ADVERTISING
The Fund or its affiliates may provide information such as, but not
limited to, the economy, investment climate, investment principles,
sociological conditions and political ambiance. Discussion may include
hypothetical scenarios or lists of relevant factors designed to aid the
investor in determining whether the Fund is compatible with the investor's
goals. The Fund may list portfolio holdings or give examples or securities
that may have been considered for inclusion in the Portfolio, whether held or
not.
The Fund or its affiliates may supply comparative performance data
and rankings from independent sources such as Donoghue's Money Fund Report,
Bank Rate Monitor, Money, Forbes, Lipper Analytical Services, Inc., CDA
Investment Technologies, Inc., Wiesenberger Investment Companies Service,
Russell 2000/Small Stock Index, Mutual Fund Values Morningstar Ratings, Mutual
Fund Forecaster, Barron's, The Wall Street Journal, and Schabacker Investment
Management, Inc. Such averages generally do not reflect any front- or back-end
sales charges that may be charged by Funds in that grouping. The Fund may also
cite to any source, whether in print or on-line, such as Bloomberg, in order
to acknowledge origin of information. The Fund may compare itself or its
portfolio holdings to other investments, whether or not issued or regulated by
the securities industry, including, but not limited to, certificates of
deposit and Treasury notes. The Fund, its Advisor, and its affiliates reserve
the right to update performance rankings as new rankings become available.
Calvert Group is the nation's leading family of socially responsible
mutual funds, both in terms of socially responsible mutual fund assets under
management, and number of socially responsible mutual fund portfolios offered
(source: Social Investment Forum, November 30, 1997). Calvert Group was also
the first to offer a family of socially responsible mutual fund portfolios.
TRUSTEES AND OFFICERS
RICHARD L. BAIRD, JR., Trustee. Mr. Baird is Executive Vice President
of Family Health Council, Inc. in Pittsburgh, Pennsylvania, a non-profit
corporation which provides family planning services, nutrition, maternal/child
health care, and various health screening services. Mr. Baird is a
trustee/director of each of the investment companies in the Calvert Group of
Funds, except for Acacia Capital Corporation, Calvert New World Fund and
Calvert World Values Fund. DOB: 05/09/48. Address: 211 Overlook Drive,
Pittsburgh, Pennsylvania 15216.
FRANK H. BLATZ, JR., Esq., Trustee. Mr. Blatz is a partner in the law
firm of Snevily, Ely, Williams, Gurrieri & Blatz. He was formerly a partner
with Abrams, Blatz, Gran, Hendricks & Reina, P.A. DOB: 10/29/35. Address: 308
East Broad Street, PO Box 2007, Westfield, New Jersey 07091.
FREDERICK T. BORTS, M.D., Trustee. Dr. Borts is a radiologist with
Kaiser Permanente. Prior to that, he was a radiologist at Bethlehem Medical
Imaging in Allentown, Pennsylvania. DOB: 07/23/49. Address: 2040 Nuuanu Avenue
#1805, Honolulu, Hawaii, 96817.
*CHARLES E. DIEHL, Trustee. Mr. Diehl is Vice President and Treasurer
Emeritus of the George Washington University, and has retired from University
Support Services, Inc. of Herndon, Virginia. He is also a Director of Acacia
Mutual Life Insurance Company. DOB: 10/13/22. Address: 1658 Quail Hollow
Court, McLean, Virginia 22101.
DOUGLAS E. FELDMAN, M.D., Trustee. Dr. Feldman practices head and
neck reconstructive surgery in the Washington, D.C., metropolitan area. DOB:
05/23/48. Address: 7536 Pepperell Drive, Bethesda, Maryland 20817.
PETER W. GAVIAN, CFA, Trustee. Mr. Gavian is a principal of Gavian De
Vaux Associates, an investment banking firm. He was formerly President of
Corporate Finance of Washington, Inc. DOB: 12/08/32. Address: 1953 Gallows
Road, Suite 130, Vienna, Virginia 22201.
JOHN G. GUFFEY, JR., Trustee. Mr. Guffey is chairman of the Calvert
Social Investment Foundation, organizing director of the Community Capital
Bank in Brooklyn, New York, and a financial consultant to various
organizations. In addition, he is a Director of the Community Bankers Mutual
Fund of Denver, Colorado, and the Treasurer and Director of Silby, Guffey, and
Co., Inc., a venture capital firm. Mr. Guffey is a trustee/director of each of
the other investment companies in the Calvert Group of Funds, except for
Acacia Capital Corporation and Calvert New World Fund. DOB: 05/15/48. Address:
7205 Pomander Lane, Chevy Chase, Maryland 20815.
M. CHARITO KRUVANT, Trustee. Ms. Kruvant is President of Creative
Associates International, Inc., a firm that specializes in human resources
development, information management, public affairs and private enterprise
development. DOB: 12/08/45. Address: 5301 Wisconsin Avenue, N.W. Washington,
D.C. 20015.
ARTHUR J. PUGH, Trustee. Mr. Pugh serves as a Director of Acacia
Federal Savings Bank. DOB: 09/24/37. Address: 4823 Prestwick Drive, Fairfax,
Virginia 22030.
*DAVID R. ROCHAT, Senior Vice President and Trustee. Mr. Rochat is
Executive Vice President of Calvert Asset Management Company, Inc., Director
and Secretary of Grady, Berwald and Co., Inc., and Director and President of
Chelsea Securities, Inc. DOB: 10/07/37. Address: Box 93, Chelsea, Vermont
05038.
*D. WAYNE SILBY, Esq., Trustee. Mr. Silby is a trustee/director of
each of the investment companies in the Calvert Group of Funds, except for
Acacia Capital Corporation and Calvert New World Fund. Mr. Silby is an
officer, director and shareholder of Silby, Guffey & Company, Inc., which
serves as general partner of Calvert Social Venture Partners ("CSVP"). CSVP is
a venture capital firm investing in socially responsible small companies. He
is also a Director of Acacia Mutual Life Insurance Company. DOB: 07/20/48.
Address: 1715 18th Street, N.W., Washington, D.C. 20009.
*BARBARA J. KRUMSIEK, President and Trustee. Ms. Krumsiek serves as
President, Chief Executive Officer and Vice Chairman of Calvert Group, Ltd.
and as an officer and director of each of its affiliated companies. She is a
director of Calvert-Sloan Advisers, L.L.C., and a trustee/director of each of
the investment companies in the Calvert Group of Funds. DOB: 08/09/52.
RENO J. MARTINI, Senior Vice President. Mr. Martini is Senior Vice
President of Calvert Group, Ltd., and Senior Vice President and Chief
Investment Officer of Calvert Asset Management Company, Inc. Mr. Martini is
also a director and President of Calvert-Sloan Advisers, L.L.C., and a
director and officer of Calvert New World Fund. DOB: 01/13/50.
RONALD M. WOLFSHEIMER, CPA, Treasurer. Mr. Wolfsheimer is Senior Vice
President and Controller of Calvert Group, Ltd. and its subsidiaries and an
officer of each of the other investment companies in the Calvert Group of
Funds. Mr. Wolfsheimer is Vice President and Treasurer of Calvert-Sloan
Advisers, L.L.C., and a director of Calvert Distributors, Inc. DOB: 07/24/52.
WILLIAM M. TARTIKOFF, Esq., Vice President and Assistant Secretary.
Mr. Tartikoff is an officer of each of the investment companies in the Calvert
Group of Funds, and is Senior Vice President, Secretary, and General Counsel
of Calvert Group, Ltd., and each of its subsidiaries. Mr. Tartikoff is also
Vice President and Secretary of Calvert-Sloan Advisers, L.L.C., a director of
Calvert Distributors, Inc., and is an officer of Acacia National Life
Insurance Company. DOB: 08/12/47.
DANIEL K. HAYES, Vice President. Mr. Hayes is Vice President of
Calvert Asset Management Company, Inc., and is an officer of each of the other
investment companies in the Calvert Group of Funds, except for Calvert New
World Fund, Inc. DOB: 09/09/50.
SUSAN WALKER BENDER, Esq., Assistant Secretary. Ms. Bender is
Associate General Counsel of Calvert Group and an officer of each of its
subsidiaries and Calvert-Sloan Advisers, L.L.C. She is also an officer of each
of the other investment companies in the Calvert Group of Funds. DOB: 01/29/59.
BETH-ANN ROTHKATHERINE STONER, Esq., Assistant Secretary. Ms. Stoner
is Associate General Counsel of Calvert Group and an officer of each of its
subsidiaries and Calvert-Sloan Advisers, L.L.C. She is also an officer of each
of the other investment companies in the Calvert Group of Funds. DOB: 10/21/56.
LISA CROSSLEY, Esq., Assistant Secretary and Compliance Officer. Ms.
Crossley is Associate General Counsel of Calvert Group and an officer of each
of its subsidiaries and Calvert-Sloan Advisers, L.L.C. She is also an officer
of each of the other investment companies in the Calvert Group of Funds. DOB:
12/31/61.
IVY WAFFORD DUKE, Esq., Assistant Secretary. Ms. Duke is Assistant
Counsel of Calvert Group and an officer of each of its subsidiaries and
Calvert-Sloan Advisers, L.L.C. She is also an officer of each of the other
investment companies in the Calvert Group of Funds. DOB: 09/07/68.
The address of directors and officers, unless otherwise noted, is
4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. Trustees and
officers of the Fund as a group own less than 1% of the Fund's outstanding
shares. Trustees marked with an *, above, are "interested persons" of the
Fund, under the Investment Company Act of 1940.
Each of the above directors/trustees and officers is a
director/trustee or officer of each of the investment companies in the Calvert
Group of Funds with the exception of Calvert Social Investment Fund, of which
only Messrs. Baird, Guffey and Silby and Ms. Krumsiek are among the trustees,
Acacia Capital Corporation, of which only Messrs. Blatz, Diehl and Pugh and
Ms. Krumsiek are among the directors, Calvert World Values Fund, Inc., of
which only Messrs. Guffey and Silby and Ms. Krumsiek are among the directors,
and Calvert New World Fund, Inc., of which only Ms. Krumsiek and Mr. Martini
are among the directors.
The Audit Committee of the Board is composed of Messrs. Baird, Blatz,
Feldman, Guffey and Pugh. The Board's Investment Policy Committee is composed
of Messrs. Borts, Diehl, Gavian, Rochat and Silby and Ms. Krumsiek.
During fiscal 1997, trustees of the Fund not affiliated with the
Fund's Advisor were paid $5,468. Trustees of the Fund not affiliated with the
Advisor presently receive an annual fee of $20,500 for service as a member of
the Board of Trustees of the Calvert Group of Funds, and a fee of $750 to
$1,500 for each regular Board or Committee meeting attended; such fees are
allocated among the respective Funds on the basis of net assets.
Trustees of the Fund not affiliated with the Fund's Advisor may elect
to defer receipt of all or a percentage of their fees and invest them in any
fund in the Calvert Family of Funds through the Trustees Deferred Compensation
Plan (shown as "Pension or Retirement Benefits Accrued as part of Fund
Expenses," below). Deferral of the fees is designed to maintain the parties in
the same position as if the fees were paid on a current basis. Management
believes this will have a negligible effect on the Fund's assets, liabilities,
net assets, and net income per share, and will ensure that there is no
duplication of advisory fees.
Trustee Compensation Table
Fiscal Year 1997 Aggregate Pension Total
(unaudited numbers) Compensation or Compensation
from Retirement from
Registrant Benefits Registrant
for Service Accrued as and Fund
as Trustee Part of Complex
Registrant Paid to
Expenses* Trustee**
Name of Trustee
Richard L. Baird, Jr. $1,779 $0 $34,450
Frank H. Blatz, Jr. $2,121 $2,121 $46,000
Frederick T. Borts $1,772 $0 $32,500
Charles E. Diehl $2,034 $2,019 $44,500
Douglas E. Feldman $1,962 $0 $32,500
Peter W. Gavian $1,997 $770 $38,500
John G. Guffey, Jr. $1,984 $0 $61,615
M. Charito Kruvant $1,779 $0 $36,250
Arthur J. Pugh $2,306 $65 $48,250
D. Wayne Silby $1,779 $0 $62,830
*Messrs. Blatz, Diehl, Gavian and Pugh have chosen to defer a portion of their
compensation. As of September 30, 1997, total deferred compensation, including
dividends and capital appreciation, was $542,400.28, $550,026.46, $132,815.21,
and $195,548.47, for each trustee, respectively.
**As of December 31, 1997, the Fund Complex consists of nine (9) registered
investment companies.
INVESTMENT ADVISOR
The Calvert Fund's Investment Advisor is Calvert Asset Management
Company, Inc., 4550 Montgomery Avenue, Bethesda, Maryland 20814, a subsidiary
of Calvert Group, Ltd., which is a subsidiary of Acacia Mutual Life Insurance
Company of Washington, D.C. ("Acacia Mutual").
The Advisory Contract between The Calvert Fund and the Advisor will
remain in effect until January 3, 1998, and from year to year thereafter,
provided continuance is approved at least annually by vote of the holders of a
majority of the outstanding shares of the Fund or by the Board of Trustees of
the Fund; and further provided that such continuance is also approved annually
by the vote of a majority of the trustees of the Fund who are not parties to
the Contract or interested persons of parties to the Contract or interested
persons of such parties, cast in person at a meeting called for the purpose of
voting on such approval. The Contract may be terminated without penalty by
either party upon 60 days' prior written notice; it automatically terminates
in the event of its assignment.
Under the Contract, the Advisor provides investment advice to The
Calvert Fund and oversees the day-to-day operations, subject to direction and
control by the Fund's Board of Trustees. For its services, the Advisor
receives an annual fee of 0.70% of the average daily net assets of Calvert
Income Fund.
The Advisor provides the Fund with investment advice and research,
office space, administrative services, furnishes executive and other personnel
to the Fund, pays the salaries and fees of all trustees who are affiliated
persons of the Advisor, and pays all Fund advertising and promotional
expenses. The Advisor reserves the right to compensate broker-dealers in
consideration of their promotional or administrative services. The Fund pays
all other operating expenses, including custodial and transfer agency fees,
federal and state securities registration fees, legal and audit fees, and
brokerage commissions and other costs associated with the purchase and sale of
portfolio securities.
For the fiscal years ended September 30, 1995, 1996, and 1997,
Calvert Income Fund paid advisory fees of $307,737, $311,154, and $290,440,
respectively.
METHOD OF DISTRIBUTION
The Fund has entered into an agreement with Calvert Distributors,
Inc. ("CDI") whereby CDI, acting as principal underwriter for the Fund, makes
a continuous offering of the Fund's securities on a "best efforts" basis.
Under the terms of the agreement, CDI is entitled to receive a distribution
fee from Calvert Income Fund of 0.25% of the Fund's average daily net assets.
For the fiscal years ended September 30, 1995, 1996, and 1997, the Fund paid
Distribution Plan expenses of $64,981, $64,681, and $62,090, respectively.
In fiscal year 1997, most of this was used to compensate dealers for their
share distribution promotional services, while the remainder partially
financed the printing and mailing of prospectuses and sales materials to
investors (other than current shareholders).
For the Funds' shares, CDI also receives the portion of the sales
charge in excess of the dealer reallowance. For fiscal years 1995, 1996, and
1997, CDI received net sales charges of $7,656, $15,770, and $11,470,
respectively.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, The
Fund has adopted a Distribution Plan which permits it to pay certain fees
associated with the distribution of its shares. Such fees may not exceed, on
an annual basis, 0.50% of the average daily net assets of Calvert Income Fund.
The Calvert Fund's Distribution Plan was approved by the Board of
Trustees, including the Trustees who are not "interested persons" of the Fund
(as that term is defined in the Investment Company Act of 1940) and who have
no direct or indirect financial interest in the operation of the Plans or in
any agreements related to the Plans. The selection and nomination of the
Trustees who are not interested persons of the Fund is committed to the
discretion of such disinterested Trustees. In establishing the Plans, the
Trustees considered various factors including the amount of the distribution
fee. The Trustees determined that there is a reasonable likelihood that the
Plans will benefit the Fund and its shareholders.
The Plans may be terminated by vote of a majority of the
non-interested Trustees who have no direct or indirect financial interest in
the Plans, or by vote of a majority of the outstanding shares of the Fund. Any
change in the Plans that would materially increase the distribution cost to
the Fund requires approval of the shareholders of the affected class;
otherwise, the Plans may be amended by the Trustees, including a majority of
the non-interested Trustees as described above.
The Plans will continue in effect until January 3, 1998, if not
sooner terminated in accordance with its terms. Thereafter, the Plans will
continue in effect for successive one-year periods provided that such
continuance is specifically approved by (i) the vote of a majority of the
Trustees who are not parties to the Plans or interested persons of any such
party and who have no direct or indirect financial interest in the Plans, and
(ii) the vote of a majority of the entire Board of Trustees.
Apart from the Plans, the Advisor, at its expense, may incur costs
and pay expenses associated with the distribution of shares of the Funds.
Certain broker-dealers, and/or other persons may receive compensation
from the investment advisor, underwriter, or their affiliates for the sale and
distribution of the securities or for services to the Fund. Such compensation
may include additional compensation based on assets held through that firm
beyond the regularly scheduled rates, and finder's fee payments to firms whose
representatives are responsible for soliciting a new account where the
accountholder does not choose to purchase through that firm.
TRANSFER AND SHAREHOLDER SERVICING AGENTS
National Financial Data Services, Inc. ("NFDS"), a subsidiary of
State Street Bank & Trust, has been retained by the Fund to act as transfer
agent and dividend disbursing agent. These responsibilities include:
responding to certain shareholder inquiries and instructions, crediting and
debiting shareholder accounts for purchases and redemptions of Fund shares and
confirming such transactions, and daily updating of shareholder accounts to
reflect declaration and payment of dividends.
Calvert Shareholder Services, Inc., a subsidiary of Calvert Group,
Ltd., and Acacia Mutual, has been retained by the Fund to act as shareholder
servicing agent. Shareholder servicing responsibilities include responding to
shareholder inquiries and instructions concerning their accounts, entering any
telephoned purchases or redemptions into the NFDS system, maintenance of
broker-dealer data, and preparing and distributing statements to shareholders
regarding their accounts. Calvert Shareholder Services, Inc. was the sole
transfer agent prior to January 1, 1998.
For these services, NFDS and Calvert Shareholder Services, Inc.
receive a total fee of $14.00 per shareholder account and $1.60 per
shareholder transaction.
PORTFOLIO TRANSACTIONS
Portfolio transactions are undertaken on the basis of their
desirability from an investment standpoint. Investment decisions and choice of
brokers and dealers are made by the Advisor under the direction and
supervision of the Board of Trustees.
For the years ended September 30, 1996 and 1997, the portfolio
turnover rates of Calvert Income Fund were 153% and 2,961%, respectively.
In all transactions, the Fund seeks to obtain the best price and most
favorable execution and selects broker-dealers on the basis of their
professional capability and the value and quality of their services.
Broker-dealers may be selected who provide the Fund with statistical,
research, or other information and services. Such broker-dealers may receive
compensation for executing portfolio transactions that is in excess of the
compensation another broker-dealer would have received for executing such
transactions if the Advisor determines in good faith that such compensation is
reasonable in relation to the value of the information or services provided.
Although any statistical, research or other information or services provided
by broker-dealers may be useful to the Advisor, its dollar value is generally
indeterminable and its availability or receipt does not materially reduce the
Advisor's normal research activities or expenses.
During the fiscal years ended September 30, 1995 and 1997, no
brokerage commissions were paid by Calvert Income Fund to any broker-dealer,
officers or trustees of The Calvert Fund or any of their affiliates. During
the fiscal year 1996, $1,000 in aggregate brokerage commissions were paid to a
broker-dealer.
INDEPENDENT ACCOUNTANTS AND CUSTODIANS
Coopers & Lybrand, L.L.P., has been selected by the Board of Trustees
to serve as independent accountants for fiscal year 1998. State Street Bank &
Trust Company, N.A., 225 Franklin Street, Boston, MA 02110, currently serves
as custodian of the Fund's investments. First National Bank of Maryland, 25
South Charles Street, Baltimore, Maryland 21203 also serves as custodian of
certain of the Fund's cash assets. The custodian has no part in deciding the
Fund's investment policies or the choice of securities that are to be
purchased or sold for the Fund's Portfolios.
GENERAL INFORMATION
The Calvert Fund (the "Trust") was organized as a Massachusetts
business trust on March 15, 1982. The Calvert Fund's series include Calvert
Income Fund and Calvert New Vision Small Cap Fund. The Calvert Fund's
Declaration of Trust contains an express disclaimer of shareholder liability
for acts or obligations of the Trust. The shareholders of a Massachusetts
business trust might, however, under certain circumstances, be held personally
liable as partners for its obligations. The Declaration of Trust provides for
indemnification and reimbursement of expenses out of the Trust's assets for
any shareholder held personally liable for obligations of the Trust. The
Declaration of Trust provides that the Trust shall, upon request, assume the
defense of any claim made against any shareholder for any act or obligation of
the Trust and satisfy any judgment thereon. The Declaration of Trust further
provides that the Trust may maintain appropriate insurance (for example,
fidelity bonding and errors and omissions insurance) for the protection of the
Trust, its shareholders, trustees, officers, employees and agents to cover
possible tort and other liabilities. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to circumstances
in which both inadequate insurance exists and the Trust itself is unable to
meet its obligations.
Each share of each series represents an equal proportionate interest
in that series with each other share and is entitled to such dividends and
distributions out of the income belonging to such series as declared by the
Board.
The Fund will send shareholders confirmations of purchase and
redemption transactions, as well as periodic transaction statements and
unaudited semi-annual and audited annual financial statements of the Fund's
investment securities, assets and liabilities, income and expenses, and
changes in net assets.
The Prospectus and this Statement of Additional Information do not
contain all the information in the Trust's registration statement. The
registration statement is on file with the Securities and Exchange Commission
and is available to the public.
FINANCIAL STATEMENTS
The Fund's audited financial statements included in its Annual Report
to Shareholders dated September 30, 1997, are expressly incorporated by
reference and made a part of this Statement of Additional Information. A copy
of the Annual Report may be obtained free of charge by writing or calling The
Calvert Fund.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
As of January 2, 1998, the following shareholder owned of record 5%
or more of the Fund:
Name and Address % of Ownership
State of Tennessee 401K Plan 5.59%
Attn: Juanita Spicers
500 Deaderick 10th Flr
Andrew Jackson Building
Nashville, TN 37242-0001
APPENDIX
LETTER OF INTENT
Date
Calvert Distributors, Inc.
4550 Montgomery Avenue
Bethesda, MD 20814
Ladies and Gentlemen:
By signing this Letter of Intent, or affirmatively marking the Letter
of Intent option on my Fund Account Application Form, I agree to be bound by
the terms and conditions applicable to Letters of Intent appearing in the
Prospectus and the Statement of Additional Information for the Fund and the
provisions described below as they may be amended from time to time by the
Fund. Such amendments will apply automatically to existing Letters of Intent.
I intend to invest in the shares of:
(Fund or Portfolio name) during the thirteen (13) month period from the date
of my first purchase pursuant to this Letter (which cannot be more than ninety
(90) days prior to the date of this Letter or my Fund Account Application
Form, whichever is applicable), an aggregate amount (excluding any
reinvestments of distributions) of at least fifty thousand dollars ($50,000)
which, together with my current holdings of the Fund (at public offering price
on date of this Letter or my Fund Account Application Form, whichever is
applicable), will equal or exceed the amount checked below:
__ $50,000 __ $100,000 __ $250,000 __ $500,000 __ $1,000,000
Subject to the conditions specified below, including the terms of
escrow, to which I hereby agree, each purchase occurring after the date of
this Letter will be made at the public offering price applicable to a single
transaction of the dollar amount specified above, as described in the Fund's
prospectus. "Fund" in this Letter of Intent shall refer to the Fund or
Portfolio, as the case may be, here indicated. No portion of the sales charge
imposed on purchases made prior to the date of this Letter will be refunded.
I am making no commitment to purchase shares, but if my purchases
within thirteen months from the date of my first purchase do not aggregate the
minimum amount specified above, I will pay the increased amount of sales
charges prescribed in the terms of escrow described below. I understand that
4.75% of the minimum dollar amount specified above will be held in escrow in
the form of shares (computed to the nearest full share). These shares will be
held subject to the terms of escrow described below.
From the initial purchase (or subsequent purchases if necessary),
4.75% of the dollar amount specified in this Letter shall be held in escrow in
shares of the Fund by the Fund's transfer agent. For example, if the minimum
amount specified under the Letter is $50,000, the escrow shall be shares
valued in the amount of $2,375 (computed at the public offering price adjusted
for a $50,000 purchase). All dividends and any capital gains distribution on
the escrowed shares will be credited to my account.
If the total minimum investment specified under the Letter is
completed within a thirteen month period, escrowed shares will be promptly
released to me. However, shares disposed of prior to completion of the
purchase requirement under the Letter will be deducted from the amount
required to complete the investment commitment.
Upon expiration of this Letter, the total purchases pursuant to the
Letter are less than the amount specified in the Letter as the intended
aggregate purchases, Calvert Distributors, Inc. ("CDI") will bill me for an
amount equal to the difference between the lower load I paid and the dollar
amount of sales charges which I would have paid if the total amount purchased
had been made at a single time. If not paid by the investor within 20 days,
CDI will debit the difference from my account. Full shares, if any, remaining
in escrow after the aforementioned adjustment will be released and, upon
request, remitted to me.
I irrevocably constitute and appoint CDI as my attorney-in-fact, with
full power of substitution, to surrender for redemption any or all escrowed
shares on the books of the Fund. This power of attorney is coupled with an
interest.
The commission allowed by Calvert Distributors, Inc. to the
broker-dealer named herein shall be at the rate applicable to the minimum
amount of my specified intended purchases.
The Letter may be revised upward by me at any time during the
thirteen-month period, and such a revision will be treated as a new Letter,
except that the thirteen-month period during which the purchase must be made
will remain unchanged and there will be no retroactive reduction of the sales
charges paid on prior purchases.
In determining the total amount of purchases made hereunder, shares
disposed of prior to termination of this Letter will be deducted. My
broker-dealer shall refer to this Letter of Intent in placing any future
purchase orders for me while this Letter is in effect.
Dealer
By
Authorized Signer
Date
Date
Name of Investor(s)
Address
Signature of Investor(s)
Signature of Investor(s)
- --------
<PAGE>
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial statements
Financial statements incorporated by reference to:
All financial statements for The Calvert Fund, Calvert
Income Fund are incorporated by reference to Registrant's
Annual Report to Shareholders dated September 30, 1997,
and filed December 16, 1997.
Schedules II-VII, inclusive, for which provision is made
in the applicable accounting regulation of the
Securities and Exchange Commission, are omitted because
they are not required under the related instructions,
or they are inapplicable, or the required information
is presented in the financial statements or notes
thereto.
(b) Exhibits:
1. Declaration of Trust (incorporated by reference to
Registrant's Initial Registration Statement,
March 15, 1982).
2. By-Laws (incorporated by reference to Registrant's
Pre-Effective Amendment No. 2, September 3, 1982).
4. Specimen Stock Certificate for all series of The
Calvert Fund (incorporated by reference to
Registrant's Post-Effective Amendment No. 28,
July 19, 1995).
5.a. Advisory Contract (incorporated by reference to
Registrant's Post-Effective Amendment No. 3,
November 1, 1984).
5.b. Sub-Advisory Contract (Portfolio Advisory
Services, Inc.) (incorporated by reference to
Registrant's Post-Effective Amendment No. 30).
6. Underwriting and Dealer Agreement
(incorporated by reference to Registrant's
Post-Effective Amendment No. 27, January 31, 1995).
7. Trustees' Deferred Compensation Agreement
(incorporated by reference to Registrant's
Post-Effective Amendment No. 20, January 28, 1992).
8. Custodial Contract (incorporated by reference
to Registrant's Post-Effective Amendment No. 21,
January 29, 1993).
9. Transfer Agency Contract (incorporated by
reference to Registrant's Post-Effective
Amendment No. 3, November 1, 1984).
10. Opinion and Consent of Counsel as to Legality
of Shares Being Registered.
11. Consent of Independent Accountants.
14. Retirement Plans (incorporated by reference to
Registrant's Post-Effective Amendment No. 20,
January 28, 1992).
15. Rule 12b-1 Distribution Plan with respect to
Registrant's Class B and C shares, incorporated by
reference to Registrant's Post-Effective Amendment
No. 27, January 31, 1995. With respect to Class A
shares, incorporated by reference to Registrant's
Post-Effective Amendment No. 28, July 19, 1995,
for all series of The Calvert Fund.
16. Schedule for computation of performance
quotation (incorporated by reference to Registrant's
Post-effective Amendment No. 14, January 25, 1989).
17.(ii) Financial Data Schedules filed herewith.
18. Multiple-class Plan under the Investment
Company Act of 1940 Rule 18f-3, (incorporated by
reference to Registrant's Post-Effective Amendment
No. 29, January 31, 1996).
Exhibits 3, 12 and 13 are omitted because they are inapplicable.
Item 25. Persons Controlled By or Under Common Control With Registrant
Registrant is controlled by its Board of Trustees, which is a
common Board with four other registered investment companies, Calvert
Tax-Free Reserves, First Variable Rate Fund for Government Income,
Calvert Cash Reserves, and Calvert Municipal Fund, Inc. In addition,
some members of Registrant's Board of Trustees also serve on the Boards
of Calvert Social Investment Fund, Acacia Capital Corporation, Calvert
New World Fund, Inc., and/or Calvert World Values Fund, Inc.
Item 26. Number of Holders of Securities
As of December 31, 1997, there were 2,585 holders of record of
Registrant's Class A shares of beneficial interest for Calvert Income Fund.
As of December 31, 1997, there were 11,258 holders of record of
Registrant's Class A shares of beneficial interest for Calvert New Vision
Small Cap Fund.
As of December 31, 1997, there were 1,398 holders of record of
Registrant's Class C shares of beneficial interest for Calvert New Vision
Small Cap Fund.
Item 27. Indemnification
Registrant's Declaration of Trust, which Declaration is Exhibit
1 of this Registration Statement, provides, in summary, that officers,
trustees, employees, and agents shall be indemnified by Registrant
against liabilities and expenses incurred by such persons in connection
with actions, suits, or proceedings arising out of their offices or
duties of employment, except that no indemnification can be made to such
a person if he has been adjudged liable of willful misfeasance, bad
faith, gross negligence, or reckless disregard of his duties. In the
absence of such an adjudication, the determination of eligibility for
indemnification shall be made by independent counsel in a written
opinion or by the vote of a majority of a quorum of trustees who are
neither "interested persons" of Registrant, as that term is defined in
Section 2(a)(19) of the Investment Company Act of 1940, nor parties to
the proceeding.
Registrant's Declaration of Trust also provides that Registrant
may purchase and maintain liability insurance on behalf of any officer,
trustee, employee or agent against any liabilities arising from such
status. In this regard, Registrant maintains a Directors & Officers
(Partners) Liability Insurance Policy with Chubb Group of Insurance
Companies, 15 Mountain View Road, Warren, New Jersey 07061, providing
Registrant with $5 million in directors and officers liability coverage,
plus $3 million in excess directors and officers liability coverage for
the independent trustees/directors only. Registrant also maintains an
$8 million Investment Company Blanket Bond issued by ICI Mutual
Insurance Company, P.O. Box 730, Burlington, Vermont, 05402.
Item 28. Business and Other Connections of Investment Adviser
Name of Company, Principal
Name Business and Address Capacity
Barbara J. Krumsiek Acacia Capital Corporation Officer
Calvert Municipal Fund, Inc. and
Calvert World Values Fund, Inc. Director
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income and
Calvert Tax-Free Reserves Trustee
Calvert Social Investment Fund
Calvert Cash Reserves
The Calvert Fund
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
----------------
Calvert Group, Ltd. Officer
Holding Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Distributors, Inc. Officer
Broker-Dealer and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert New World Fund, Inc. Director
Investment Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
--------------
Alliance Capital Mgmt. L.P. Sr. Vice President
Mutual Fund Division Director
1345 Avenue of the Americas
New York, NY 10105
--------------
Ronald M. Wolfsheimer First Variable Rate Fund Officer
for Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
--------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Distributors, Inc. Director
Broker-Dealer and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
David R. Rochat First Variable Rate Fund Officer
for Government Income and
Calvert Tax-Free Reserves Trustee
Calvert Cash Reserves
The Calvert Fund
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Municipal Fund, Inc. Officer
Investment Company and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor and
4550 Montgomery Avenue Director
Bethesda, Maryland 20814
---------------
Chelsea Securities, Inc. Officer
Securities Firm and
Post Office Box 93 Director
Chelsea, Vermont 05038
---------------
Grady, Berwald & Co. Officer
Holding Company and
43A South Finley Avenue Director
Basking Ridge, NJ 07920
---------------
Reno J. Martini Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
First Variable Rate Fund Officer
for Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert New World Fund, Inc. Director
Investment Company and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
---------------
Calvert-Sloan Advisers, LLC Director
Investment Advisor and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
---------------
Charles T. Nason Acacia Mutual Life Insurance Officer
Acacia National Life Insurance and Director
Insurance Companies
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Financial Corporation Officer
Holding Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
---------------
Gardner Montgomery Company Director
Tax Return Preparation Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
Acacia Federal Savings Bank Director
Savings Bank
7600-B Leesburg Pike
Falls Church, Virginia 22043
---------------
Enterprise Resources, Inc. Director
Business Support Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Insurance Management Officer
Services Corporation and
Service Corporation Director
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Director
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Director
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Director
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Social Investment Fund Trustee
Investment Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
-----------------
The Advisors Group, Inc. Director
Broker-Dealer and
Investment Advisor
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Robert-John H. Acacia National Life Insurance Officer
Sands Insurance Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
----------------
Acacia Mutual Life Insurance Officer
Insurance Company
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
Acacia Financial Corporation Officer
Holding Company and
7315 Wisconsin Avenue Director
Bethesda, Maryland 20814
----------------
Acacia Federal Savings Bank Officer
Savings Bank
7600-B Leesburg Pike
Falls Church, Virginia 22043
---------------
Enterprise Resources, Inc. Director
Business Support Services
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Realty Corporation Officer
Real Estate Investments
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Acacia Insurance Management Officer
Services Corporation and
Service Corporation Director
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Gardner Montgomery Company Officer
Tax Return and
Preparation Services Director
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
The Advisors Group, Inc. Director
Broker-Dealer and
Investment Advisor
7315 Wisconsin Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Director
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Director
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management, Co., Inc. Director
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Shareholder Services, Inc. Director
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
William M. Tartikoff Acacia National Life Insurance Officer
Insurance Company
7315 Wisconsin Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Officer
Services Company
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co. Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Director
Broker-Dealer and
4550 Montgomery Avenue Officer
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Susan Walker Bender Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Katherine Stoner Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Lisa Crossley Newton Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Ivy Wafford Duke Calvert Group, Ltd. Officer
Holding Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Administrative Services Co. Officer
Service Company
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Shareholder Services, Inc. Officer
Transfer Agent
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert Distributors, Inc. Officer
Broker-Dealer
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
Calvert-Sloan Advisers, LLC Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
----------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Calvert New World Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
---------------
Daniel K. Hayes Calvert Asset Management Co., Inc. Officer
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
First Variable Rate Fund for Officer
Government Income
Calvert Tax-Free Reserves
Calvert Cash Reserves
Calvert Social Investment Fund
The Calvert Fund
Acacia Capital Corporation
Calvert Municipal Fund, Inc.
Calvert World Values Fund, Inc.
Investment Companies
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Steve Van Order Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Annette Krakovitz Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
John Nichols Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
David Leach Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Item 29. Principal Underwriters
(a) Registrant's principal underwriter also underwrites
shares of First Variable Rate Fund for Government Income, Calvert
Tax-Free Reserves, Calvert Social Investment Fund, Calvert Cash Reserves,
Calvert Municipal Fund, Inc., Calvert World Values Fund, Inc.,
Calvert New World Fund, Inc., and Acacia Capital Corporation.
(b) Positions of Underwriter's Officers and Directors
Name and Principal Position(s) with Position(s) with
Business Address Underwriter Registrant
Barbara J. Krumsiek Director and President President and Trustee
Ronald M. Wolfsheimer Director, Senior Vice Treasurer
President and Chief Financial Officer
William M. Tartikoff Director, Senior Vice Vice President and
President and Secretary Secretary
Karen Becker Vice President, Operations None
Steve Cohen Vice President None
Geoffrey Ashton Regional Vice President None
Martin Brown Regional Vice President None
Janet Haley Regional Vice President None
Ben Ogbogu Regional Vice President None
Susan Walker Bender Assistant Secretary Assistant Secretary
Katherine Stoner Assistant Secretary Assistant Secretary
Lisa Crossley Newton Assistant Secretary Assistant Secretary
and Compliance Officer
Ivy Wafford Duke Assistant Secretary Assistant Secretary
(c) Inapplicable.
Item 30. Location of Accounts and Records
Ronald M. Wolfsheimer, Treasurer
and
William M. Tartikoff, Assistant Secretary
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
Item 31. Management Services
Not Applicable
Item 32. Undertakings
a) Not Applicable
b) Not Applicable
(c) The Registrant undertakes to furnish to each person to
whom a Prospectus is delivered, a copy of the
Registrant's latest Annual Report to Shareholders, upon
request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940, the Registrant certifies that it
meets all of the requirements for effectiveness of this registration
statement pursuant to Rule 485(b) under the Securities Act of 1933 and
has duly caused this registration statement to be signed on its behalf
by the undersigned, thereto duly authorized in the City of Bethesda, and
State of Maryland, on the 21st day of January, 1998.
THE CALVERT FUND
By:
_________________________________
Barbara J. Krumsiek
President and Trustee
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following
persons in the capacities indicated.
Signature Title Date
__________**____________ President and 1/21/98
Barbara J. Krumsiek Trustee (Principal Executive Officer)
__________**____________ Principal Accounting 1/21/98
Ronald M. Wolfsheimer Officer
__________**____________ Trustee 1/21/98
Richard L. Baird, Jr.
__________**____________ Trustee 1/21/98
Frank H. Blatz, Jr., Esq.
__________**____________ Trustee 1/21/98
Frederick T. Borts, M.D.
__________**____________ Trustee 1/21/98
Charles E. Diehl
__________**____________ Trustee 1/21/98
Douglas E. Feldman
__________**____________ Trustee 1/21/98
Peter W. Gavian
__________**____________ Trustee 1/21/98
John G. Guffey, Jr.
__________**____________ Trustee 1/21/98
M. Charito Kruvant
__________**____________ Trustee 1/21/98
Arthur J. Pugh
__________**____________ Trustee 1/21/98
David R. Rochat
__________**____________ Trustee 1/21/98
D. Wayne Silby
**By Ivy Wafford Duke as Attorney-in-fact, pursuant to Power of Attorney Forms
on file.
<PAGE>
EXHIBIT INDEX
Form N-1A
Item No.
Ex-23
24(b)(10) Form of Opinion and Consent of Counsel
Ex-23
24(b)(11) Independent Auditors' Consent
Ex-24 Power of Attorney
Ex-27
24(17) Financial Data Schedules
Exhibit 10
January 21, 1998
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Exhibit 10, Form N-1A
The Calvert Fund
File numbers 2-76510 and 811-3416
Ladies and Gentlemen:
As Assistant Counsel to The Calvert Fund (the "Trust"), it is
my opinion, based upon an examination of the Trust's Declaration of
Trust and By-Laws and such other original or photostatic copies of Trust
records, certificates of public officials, documents, papers, statutes,
and authorities as I deemed necessary to form the basis of this opinion,
that the securities being registered by this Post-Effective Amendment
No. 33 of the Trust will, when sold, be legally issued, fully paid and
non-assessable.
Consent is hereby given to file this opinion of counsel with
the Securities and Exchange Commission as an Exhibit to the Trust's
Post-Effective Amendment No. 33 to its Registration Statement.
Sincerely,
Ivy Wafford Duke
Assistant Counsel
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of The Calvert Fund
We consent to the incorporation by reference in Post-Effective Amendment
No. 33 to the Registration Statement of The Calvert Fund on Form N-1A (File
Numbers 2-76510 and 811-3416) of our report dated November 7, 1997 on our audit
of the financial statements and financial highlights of Calvert Income Fund,
which report is included in the Annual Report to Shareholders for the year ended
September 30, 1997, which is incorporated by reference in the Registration
Statement. We also consent to the reference to our firm under the caption
"Independent Accountants and Custodians" in the Statement of Additional
Information.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
January 21, 1998
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix Barbara Krumsiek
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix Richard L. Baird, Jr.
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Charles E. Diehl Frank H. Blatz, Jr.
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix Douglas E. Feldman
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Frank H. Blatz, Jr. Charles E. Diehl
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix Peter W. Gavian
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
M. Charito Kruvant John G. Guffey, Jr.
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix M. Charito Kruvant
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Charles E. Diehl Arthur J. Pugh
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Katherine Stoner David R. Rochat
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
May 7, 1997
Date /Signature/
Edwidge Saint-Felix D. Wayne Silby
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned Trustee/Director of First Variable Rate Fund for
Government Income, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund, and Calvert Municipal Fund, Inc. (collectively, the "Funds"),
hereby constitute Ronald M. Wolfsheimer, William M. Tartikoff, Susan Walker
Bender, Katherine Stoner, Lisa Crossley, and Ivy Wafford Duke my true and
lawful attorneys, with full power to each of them, to sign for me and in my
name in the appropriate capacities, all registration statements and amendments
filed by the Funds with any federal or state agency, and to do all such things
in my name and behalf necessary for registering and maintaining registration
or exemptions from registration of the Funds with any government agency in any
jurisdiction, domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
January 16, 1998
Date /Signature/
Roger Wilkins Frederick Borts, MD
Witness Name of Trustee/Director
<PAGE>
POWER OF ATTORNEY
I, the undersigned officer of Calvert Social Investment Fund, Calvert
World Values Fund, Acacia Capital Corporation, Calvert New World Fund, First
Variable Rate Fund, Calvert Tax-Free Reserves, Calvert Cash Reserves, The
Calvert Fund and Calvert Municipal Fund (each, respectively, the "Fund"),
hereby constitute William M. Tartikoff, Susan Walker Bender, Katherine Stoner,
Lisa Crossley, and Ivy Wafford Duke my true and lawful attorneys, with full
power to each of them, to sign for me and in my name in the appropriate
capacities, all registration statements and amendments filed by the Fund with
any federal or state agency, and to do all such things in my name and behalf
necessary for registering and maintaining registration or exemptions from
registration of the Fund with any government agency in any jurisdiction,
domestic or foreign.
The same persons are authorized generally to do all such things in my
name and behalf to comply with the provisions of all federal, state and
foreign laws, regulations, and policy pronouncements affecting the Funds,
including, but not limited to, the Securities Act of 1933, the Securities
Exchange Act of 1934, the Investment Company Act of 1940, the Investment
Advisers Act of 1940, and all state laws regulating the securities industry.
The same persons are further authorized to sign my name to any
document needed to maintain the lawful operation of the Funds in connection
with any transaction approved by the Board of Trustee/Directors.
When any of the above-referenced attorneys signs my name to any
document in connection with maintaining the lawful operation of the Funds, the
signing is automatically ratified and confirmed by me by virtue of this Power
of Attorney.
WITNESS my hand on the date set forth below.
December 16, 1997
Date /Signature/
William M. Tartikoff Ronald M. Wolfsheimer
Witness Name of Officer
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000701039
<NAME> THE CALVERT FUN
<SERIES>
<NUMBER> 123
<NAME> CALVERT INCOME FUND
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 38702
<INVESTMENTS-AT-VALUE> 38650
<RECEIVABLES> 460
<ASSETS-OTHER> 303
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 39413
<PAYABLE-FOR-SECURITIES> 44
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 67
<TOTAL-LIABILITIES> 111
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 38334
<SHARES-COMMON-STOCK> 2285
<SHARES-COMMON-PRIOR> 2783
<ACCUMULATED-NII-CURRENT> (14)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1034
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (52)
<NET-ASSETS> 39302
<DIVIDEND-INCOME> 75
<INTEREST-INCOME> 2957
<OTHER-INCOME> 0
<EXPENSES-NET> 521
<NET-INVESTMENT-INCOME> 2511
<REALIZED-GAINS-CURRENT> 1531
<APPREC-INCREASE-CURRENT> 306
<NET-CHANGE-FROM-OPS> 4348
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2525)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3823
<NUMBER-OF-SHARES-REDEEMED> (14244)
<SHARES-REINVESTED> 2070
<NET-CHANGE-IN-ASSETS> (6508)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (497)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 290
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 550
<AVERAGE-NET-ASSETS> 41393
<PER-SHARE-NAV-BEGIN> 16.47
<PER-SHARE-NII> 1.020
<PER-SHARE-GAIN-APPREC> 0.740
<PER-SHARE-DIVIDEND> (1.030)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 17.20
<EXPENSE-RATIO> 1.26
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
