<PAGE>
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. 34 XX
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and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 34 XX
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The Calvert Fund
Calvert New Vision Small Cap 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 March 31, 1998
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pursuant to paragraph (b) pursuant to paragraph (b)
60 days after filing on (date)
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pursuant to paragraph (a) pursuant to paragraph (a)
of Rule 485.
<PAGE>
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 March 31, 1998
CALVERT CAPITAL ACCUMULATION FUND
CALVERT NEW VISION SMALL CAP FUND
4550 Montgomery Avenue, Bethesda, Maryland 20814
CALVERT CAPITAL ACCUMULATION FUND seeks long-term capital appreciation by
investing primarily in the stock of medium-sized companies using the talent of
one or more investment subadvisors. The market capitalization of companies
chosen for investment will generally be within the range of capitalization of
the S&P 400 Mid-Cap Index, but the Fund may also invest in larger and smaller
companies as deemed appropriate. It is the Advisor's intent that on average, the
market capitalization of the companies represented in the Fund's portfolio will
be mid-sized, with a slight bias toward the growth-style of investing. Other
investments may include foreign securities, convertible issues, and certain
options and futures transactions. The Fund will take reasonable risks in seeking
to achieve its investment objective.
CALVERT NEW VISION SMALL CAP FUND seeks to achieve long-term capital
appreciation by investing primarily in the equity securities of small
companies(1) publicly traded in the United States. In seeking capital
appreciation, the Fund invests primarily in the equity securities of small
capitalized growth companies (including American Depositary Receipts ("ADRs"))
that have historically exhibited exceptional growth characteristics and that, in
the Advisor's opinion, have strong earnings potential relative to the U.S.
market as a whole. The Fund employs aggressive investment strategies that have
the potential for yielding high returns. The Fund will take reasonable risks in
seeking to achieve its investment objective.
Share prices of both Funds may experience substantial fluctuations so that your
shares may be worth less than when you originally purchased them. Income is not
an objective of either Fund; the Funds should not be used to meet short-term
financial needs. There can be no assurance that either Fund will be successful
in meeting its investment objective.
RESPONSIBLE INVESTING
To the extent possible, investments are made in enterprises that make a
significant contribution to our society through their products and services and
through the way they do business.
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 FUNDS 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.
(1) Currently those with a total capitalization of less than $1 billion at the
time of the Fund's initial investment.
1
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PURCHASE INFORMATION
The Funds both offer three classes of shares, each with different expense levels
and sales charges. You may choose to purchase (i) Class A shares, with a sales
charge imposed at the time you purchase the shares ("front-end sales charge");
(ii) Class B shares, which impose no front-end sales charge, but will impose a
deferred sales charge at the time of redemption, depending on how long you have
owned the shares )("contingent deferred sales charge," or "CDSC"), or (iii)
Class C shares which impose no front-end sales charge but will impose a CDSC on
shares purchased after May 31, 1998, if they are sold within one year. Class C
shares are not available through all dealers. Class B and C shares have a higher
level of expenses than Class A shares, including higher Rule 12b-1 fees. These
alternatives permit you to choose the method of purchasing shares that is most
beneficial to you, depending on the amount of the purchase, the length of time
you expect to hold the shares, and other circumstances. See "Alternative Sales
Options" for further details.
TO OPEN AN ACCOUNT
Call your investment professional, or complete and return the enclosed Account
Application. Minimum initial investment is $2,000 (may be lower for certain
retirement plans).
ABOUT THIS PROSPECTUS
Please read this Prospectus for information you should know before investing,
and keep it for future reference. A Statement of Additional Information ("SAI")
(dated March 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.
<TABLE>
<CAPTION>
FUND EXPENSES
Capital Accumulation New Vision
Fund Small Cap Fund
<S> <C> <C> <C> <C> <C> <C>
A. Shareholder Transaction Costs Class A Class B Class C Class A Class B Class C
Maximum Front-End Sales Charge on
Purchases (as a percentage of offering price) 4.75% None None 4.75% None None
Maximum Contingent Deferred Sales Charge None 5.00%* 1.00%** None 5.00%* 1.00%*
(as percentage of original purchase price or
redemption proceeds, as applicable 1.00% 1.00%
B. Annual Fund Operating Expenses
(Fiscal Year 1997) (unaudited)
(as a percentage of average net assets)
Management Fees 0.89% 0.89% 0.89% 1.00% 1.00% 1.00%
Rule 12b-1 Service and Distribution Fees 0.35% 1.00% 1.00% 0.25% 1.00% 1.00%
Other Expenses 0.54% 1.27% 1.02% 0.62%(3) 0.99% 0.74%(3)
----- ----- ----- ----- ----- -----
Total Fund Operating Expenses(2) 1.78% 3.16% 2.91% 1.87% 2.99% 2.74%
</TABLE>
* A contingent deferred sales charge is imposed on the proceeds of Class B
shares redeemed within 6 years, subject to certain exceptions. That charge is
imposed as a percentage of net asset value at the time of purchase or
redemption, whichever is less and declines from 5% in the first year that shares
are held, to 4% in the second and third years, 3% in the fourth year, 2% in the
fifth year, and 1% in the sixth year. There is no charge on redemptions of
Class B shares held for more than six years. See "Calculation of Contingent
Deferred Sales charge" below.
** A contingent deferred sales charge is imposed on the proceeds of Class C
shares redeemed within one year. That charge is imposed as a percentage of net
asset value at the time of purchase or redemption, whichever is less. See
"Calculation of Contingent deferred Sales Charge."
(2) Net Fund Operating Expenses after reduction for fees paid indirectly for the
Capital Accumulation fund were: Class A - 1.86%, Class C - 3.14%
(3) Estimated
2
<PAGE>
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; (3) for Class A,
payment of maximum initial sales charge at time of purchase, and (4) for
Class B shares, payment of maximum applicable contingent deferred sales
charge.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
CAPITAL
ACCUMULATION
<S> <C> <C> <C> <C>
Class A $65 $101 $139 $247
Class B
Assuming a
complete
redemption at end
of period $84 $140 $187 $314
Assuming no
redemption $32 $97 $165 $314
Class C
Assuming a
complete
redemption at end
of period $40 $90 $153 $323
Assuming no
redemption $29 $90 $153 $323
NEW VISION SMALL
CAP
Class A $66 $103 $144 $256
Class B
Assuming a
complete
redemption at end
of period $81 $135 $179 $304
Assuming no
redemption $30 $92 $157 $304
Class C
Assuming a
complete
redemption at end
of period $38 $85 $145 $307
Assuming no
redemption $28 $85 $145 $307
</TABLE>
3
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THE EXAMPLE 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 WOULD BEAR DIRECTLY
(SHAREHOLDER TRANSACTION COSTS) OR INDIRECTLY (ANNUAL FUND OPERATING EXPENSES).
A. SHAREHOLDER TRANSACTION COSTS
are charges you pay when you buy or sell shares of the Fund. See "Reduced Sales
Charges" 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.
B. ANNUAL FUND OPERATING EXPENSES
are based on fiscal 1997 historical expenses, except for Class B of the Capital
Accumulation Fund and the New Vision Small Cap Fund. Management fees are paid by
the Funds to the Advisor for managing the Fund's investments and business
affairs. Management fees include the subadvisory fees paid by Calvert Asset
Management Company, Inc. (the "Advisor") to the various subadvisors and the
administrative service fee paid to Calvert Administrative Services Company.
Management Fees have been restated to reflect expenses anticipated in the
current fiscal year. (See "Management of the Fund") The Management fees for the
Capital Accumulation Fund are subject to a performance adjustment which could
cause the fee to be as high as 0.95% or as low as 0.65%, depending on
performance. The Funds incur 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 Funds' daily share
price and are not charged directly to individual shareholder accounts. Please
refer to "Management of the Fund" for further information. The Advisor may
voluntarily defer fees or assume expenses of the Funds. The respective
Investment Advisory Agreements provide that the Advisor may, to the extent
permitted by law, later recapture any fees it deferred or expenses it assumed
during the two prior years.
The Funds' Rule 12b-1 fees include an asset-based sales charge. Thus,
long-term shareholders in each 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 Funds. See the SAI, "Method of Distribution."
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides information about the financial history of the
Funds' Class A and C shares. It expresses the information in terms of a single
share outstanding for the Fund throughout each period. No Class B Shares were
outstanding during the periods presented. The table has been audited by Coopers
& Lybrand, L.L.P., 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.
<TABLE>
<CAPTION>
CLASS A SHARES
From Oct. 31,
Period Ended Year Ended 1994 (Inception)
Sept. 30, 1997 Sept. 30, 1996 to Sept. 30, 1995
(Unaudited)
<S> <C> <C> <C>
Capital Accumulation Fund
Net asset value, beginning of period $22.55 $21.48 $15.00
Income from investment operations
Net investment income (loss) (.14) (.24) (.11)
Net realized and unrealized gain (loss) 4.80 1.88 6.61
Total from investment operations 4.66 1.64 6.50
Distributions from
Net investment income -- -- (.02)
Net realized gains -- (.57) --
Total Distributions -- (.57) (.02)
Total increase (decrease) in
net asset value 4.66 1.07 6.48
Net asset value, ending $27.21 $22.55 $21.48
Total return4 20.67% 7.92% 43.40%
Ratio to average net assets:
Net investment income (loss) (1.02%) (1.56%) (1.55%)(a)
Total expenses5 1.78% 2.16% 2.35%(a)
Net expenses 1.72% 1.98% 2.06%(a)
Expenses reimbursed -- -- .05%(a)
Portfolio turnover 126% 114% 95%
Average commission rate paid $.0530 $.0563 $--
Net assets, ending (in thousands) $54,751 $39,834 $16,111
Number of shares outstanding,
ending (in thousands) 2,012 1,767 750
</TABLE>
(4) Total return is not annualized and does not reflect deduction of Class A
front-end sales charges.
(5) This ratio reflects total expenses before reduction for fees paid
indirectly; such reductions are included in the ratio of net expenses.
(a) Annualized
5
<PAGE>
<TABLE>
<CAPTION>
CLASS C SHARES
From October 31,
Year Ended Year Ended 1994 (Inception)
Sept. 30, 1997 Sept. 30, 1996 to Sept. 30, 1995
(Unaudited)
<S> <C> <C> <C>
Capital Accumulation Fund
Net asset value, beginning of period $22.34 $21.55 $15.00
Income from investment operations
Net investment income (loss) .04 (.55) (.15)
Net realized and unrealized gain (loss) 4.26 1.91 6.70
Total from investment operations 4.30 1.36 6.55
Distributions from
Net investment income -- --
Net realized gains (.57) --
Total Distributions (.57) --
Total increase (decrease) in
net asset value 4.30 .79 6.55
Net asset value, ending $26.64 $22.34 $21.55
Total return(6) 19.25% 6.56%43.67%
Ratio to average net assets:
Net investment income (loss) (2.14%) (2.82%) (3.13%)(a)
Total expenses(7) 2.91% 3.42% 3.79%(a)
Net expenses 2.85% 3.24% 3.50%(a)
Expenses reimbursed -- -- 2.79%(a)
Portfolio turnover 126% 114% 95%
Average commission rate paid$ $.0530 $.0563 $--
Net assets, ending (in thousands) $4,184 $3,164 $1,992
Number of shares outstanding,
ending (in thousands) 157 142 92
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
CLASS A SHARES
Sept. 30, 1997 From January 31, to
(Unaudited) March 31, 1997
<S> <C> <C>
New Vision Small Cap Fund
Net asset value, beginning of period $15.00 $15.00
Income from investment operations
Net investment income (loss) (.05) __
Net realized and unrealized gain (loss) .70 (3.01)
Total from investment operations .65 (3.01)
Distributions from
Net investment income -- --
Net realized gains -- --
Total Distributions -- --
Total increase (decrease) in
net asset value .65 (3.01)
Net asset value, ending $15.65 $11.99
Total return(6) 4.33% (20.07%)
Ratio to average net assets:
Net investment income (loss) (.55%)(a) __
Total expenses(7) 1.05%(a) .82%(a)
Net expenses .69%(a) __
Expenses reimbursed 2.59%(a) 21.08%(a)
Portfolio turnover 196% 97%
Average commission rate paid $.0488 $.0500
Net assets, ending (in thousands) $3,260 $200
Number of shares outstanding, 208 17
ending (in thousands)
</TABLE>
(6) Total return is not annualized and does not reflect deduction of
Class A front-end sales charges.
(7) This ratio reflects total expenses before reduction for fees paid
indirectly; such reductions are included in the ratio of net expenses.
(a) Annualized
7
<PAGE>
<TABLE>
<CAPTION>
CLASS C SHARES
Sept. 30, 1997 From January 31,
(Unaudited) to March 31, 1997
<S> <C> <C>
New Vision Small Cap Fund
Net asset value, beginning of period $15.00 $15.00
Income from investment operations
Net investment income (loss) (.10) --
Net realized and unrealized gain (loss) .72 (3.01)
Total from investment operations .62 (3.01)
Distributions from
Net investment income -- --
Net realized gains -- --
Total Distributions -- --
Total increase (decrease) in
net asset value .62 (3.01)
Net asset value, ending $15.62 $11.99
Total return(6) 4.13% (20.07%)
Ratio to average net assets:
Net investment income (loss) (.72%)(a) --
Total expenses(7) 1.12%(a) .82%(a)
Net expenses .87%(a) --
Expenses reimbursed 7.14%(a) 21.08%(a)
Portfolio turnover 196% 97%
Average commission rate paid $.0488 $.0500
Net assets, ending (in thousands) $318 $200
Number of shares outstanding,
ending (in thousands) 20 17
</TABLE>
(6) Total return is not annualized and does not reflect deduction of Class A
front-end sales charges.
(7) This ratio reflects total expenses before reduction for fees paid
indirectly; such reductions are included in the ratio of net expenses.
(a) Annualized
8
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
CAPITAL ACCUMULATION FUND
The Capital Accumulation Fund seeks to provide long-term capital appreciation by
investing, under normal market conditions, at least 65% of its assets in the
equity securities of mid-sized companies. It invests primarily in a
nondiversified portfolio of the equity securities of mid-sized companies that
are undervalued but demonstrate a potential for growth. The Fund will rely on
its proprietary research to identify stocks that may have been overlooked by
analysts, investors, and the media, and which will generally be within the range
of capitalization of the S&P 400 Mid-Cap Index, but which may be larger or
smaller as deemed appropriate. Investments may also include, but are not limited
to, preferred stocks, foreign securities, convertible securities, bonds, notes
and other debt securities. The Fund may use certain futures and options, invest
in repurchase agreements, and lend its portfolio securities. The Fund will take
reasonable risks in seeking to achieve its investment objective. There is, of
course, no assurance that the Fund will be successful in meeting its objective
since there is risk involved in the ownership of all equity securities. The
Fund's investment objective is not fundamental and may be changed without
shareholder approval. The Fund will notify shareholders at least thirty days in
advance of a change in the investment objective of the Fund so that shareholders
may determine whether the Fund's goals continue to meet their own.
NEW VISION SMALL CAP FUND
The Calvert New Vision Small Cap Fund seeks to provide long-term capital
appreciation by investing primarily in equity securities of companies that have
small market capitalizations. In seeking capital appreciation, the Fund invests
primarily in equity securities of small capitalized growth companies that have
historically exhibited exceptional growth characteristics and that, in the
Advisor's opinion, have strong earnings potential relative to the U.S. market as
a whole. The Fund's investment objective is not fundamental and may be changed
without shareholder approval.
The New Vision Small Cap Fund pursues the objective of capital appreciation by
investing primarily in equity securities of small companies with promising
growth potential. These companies typically are developing innovative products
or services to seize emerging opportunities.
UNDER NORMAL CIRCUMSTANCES, THE NEW VISION SMALL CAP FUND WILL INVEST AT LEAST
65% OF ITS TOTAL ASSETS IN EQUITY SECURITIES OF COMPANIES PUBLICLY TRADED IN THE
UNITED STATES (CURRENTLY THOSE WITH A TOTAL MARKET CAPITALIZATION OF UNDER $1
BILLION AT THE TIME OF THE FUND'S INITIAL INVESTMENT).
The New Vision Small Cap Fund considers issuers of all industries with
operations in all geographic markets, and does not seek interest income or
dividends. Equity securities may include common stocks, preferred stocks,
convertible securities and warrants. The Fund may hold cash or cash equivalents
for temporary defensive purposes or to enable it to take advantage of buying
opportunities. There is, of course, no assurance that the Fund will be
successful in meeting its objective.
Companies whose capitalization increases or decreases after initial purchase by
the Fund continue to be considered small-capitalized for purposes of the 65%
policy. Accordingly, less than 65% of the Fund's total assets may be invested in
securities of issuers of companies publicly traded in the United States
(currently those with a total market capitalization of less than $1 billion).
The New Vision Small Cap Fund will normally be as fully invested as practicable
in common stocks (including ADRs), but also may invest in warrants and rights to
purchase common stocks and in debt securities and preferred stocks convertible
into common stocks (collectively, "equity securities").
9
<PAGE>
INVESTMENT TECHNIQUES AND RISKS
RISKS
A company's market capitalization is the total market value of its outstanding
equity securities. The value of the Fund's investments will vary from day to
day, and generally reflect market conditions, interest rates and other company,
political, or economic news. In the short-term, stock prices can fluctuate
dramatically in response to these factors. Over time, however, stocks have shown
greater growth potential than other types of securities.
NONDIVERSIFIED
There may be risks associated with the Capital Accumulation Fund being
nondiversified. Specifically, since a relatively high percentage of the assets
of the Capital Accumulation Fund may be invested in the obligations of a limited
number of issuers, the value of the shares of the Capital Accumulation Fund may
be more susceptible to any single economic, political or regulatory event than
the shares of a diversified fund would be.
SMALL CAP ISSUERS
While any investment in securities carries a certain degree of risk, the
approach of the Fund is designed to maximize growth in relation to the risks
assumed. The securities of small cap issuers may be less actively traded than
the securities of larger issuers, may trade in a more limited volume, and may
change in value more abruptly than securities of larger companies.
Information concerning these securities may not be readily available so that the
companies may be less actively followed by stock analysts. Small-cap issuers do
not usually participate in market rallies to the same extent as more widely-
known securities, and they tend to have a relatively higher percentage of
insider ownership.
Investing in smaller, new issuers generally involves greater risk than investing
in larger, established issuers. Companies in which the Fund is likely to invest
may have limited product lines, markets or financial resources and may lack
management depth. The securities in such companies may also have limited
marketability and may be subject to more abrupt or erratic market movements than
securities of larger, more established companies or the market averages in
general. Accordingly an investment in the Fund may not be appropriate for all
investors.
TEMPORARY DEFENSIVE POSITIONS
Under normal market conditions the Fund strives to be fully invested in
securities. However, for temporary defensive purposes -- which may include a
lack of adequate purchase candidates or an unfavorable market environment -- the
Capital Accumulation Fund may invest up to 100% of its total assets, and the New
Vision Small Cap Fund may invest up to 35% of its total assets, in cash or cash
equivalents. Cash equivalents include instruments such as, but not limited to,
U.S. government and agency obligations, certificates of deposit, bankers'
acceptances, time deposits, commercial paper, short-term corporate debt
securities and repurchase agreements.
The Fund currently intends to invest no more than 5% of its net assets in
noninvestment-grade debt obligations. Although the Capital Accumulation Fund
invests primarily in equity securities, it may invest in debt securities and,
although the New Vision Small Cap Fund also invests primarily in equity
securities, it may invest up to 35% of its total assets in debt securities,
excluding money market instruments. These debt securities may consist of
investment-grade and noninvestment-grade obligations. Investment-grade
obligations are those which, 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
10
<PAGE>
and Poor's Corporation (AAA, AA, A, or BBB), or, if unrated, are deemed to be of
comparable quality by the Advisor. Noninvestment-grade securities are those
rated below Baa or BBB, or unrated obligations that the investment subadvisor
has determined are not investment-grade; such securities are speculative in
nature, the Funds currently intend to limit such investments to 5% of their
respective net assets. The Funds will not buy debt securities rated lower than
C.
INTEREST-RATE RISK
All fixed income instruments are subject to interest-rate risk: that is, if
market interest rates rise, the current principal value of a bond will decline.
In general, the longer the maturity of the bond, the greater the decline in
value will be.
THE FUND MAY USE OPTIONS AND FUTURES AS DEFENSIVE STRATEGIES.
The Capital Accumulation Fund may attempt to reduce the overall risk of its
investments by using options and futures contracts. An option is a legal
contract that gives the holder the right to buy or sell a specified amount of
the underlying interest at a fixed or determinable price (called the exercise or
strike price) upon exercise of the option. A futures contract is an agreement to
take delivery or to make delivery of a standardized quantity and quality of a
certain commodity during a particular month in the future at a specified price.
The Subadvisor will make decisions whether to invest in these instruments based
on market conditions, regulatory limits and tax considerations. If this strategy
is used, the Fund may be required to cover assets used for this purpose in a
segregated account for the protection of shareholders.
In extraordinary circumstances, the New Vision Small Cap Fund may use options
and futures contracts to increase or decrease its exposure to changing security
prices, interest 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 swap
agreements, and purchasing indexed securities. The Fund can use these practices
only as protection against an adverse move of the holdings in the Fund to adjust
the risk and return characteristics of the Fund. The decision to invest in these
instruments will be based on market conditions, regulatory limits and tax
considerations. If market conditions are judged incorrectly, a strategy 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 limitation on
illiquid securities. See below and the Statement of Additional Information for
more details about these strategies.
RISKS OF USING DEFENSIVE STRATEGIES
There can be no assurance that engaging in options, futures, or any other
defensive strategy will be successful. While defensive strategies are designed
to protect the Funds from potential declines, if the Subadvisor misgauges market
values, interest rates, or other economic factors, the Funds may be worse off
than had they not employed the defensive strategy. While the Subadvisors attempt
to determine price movements and thereby prevent declines in the value of
portfolio holdings, there is a risk of imperfect or no correlation between price
movements of portfolio investments and instruments used as part of a defensive
strategy so that a loss is incurred. While defensive strategies can reduce the
risk of loss, they can also reduce the opportunity for gain since they offset
favorable price movements. The use of defensive strategies may result in a
disadvantage to the Funds if a Fund is not able to purchase or sell a portfolio
holding at an optimal time due to the need to cover its transaction in its
segregated account, or due to the inability of a Fund to liquidate its position
because of its relative illiquidity.
11
<PAGE>
REPURCHASE AGREEMENTS
The Funds may engage in repurchase agreements to earn a higher rate of return
than it could earn simply by investing in the obligation which is the subject of
the repurchase agreement. The Funds will only engage in repurchase agreements
with recognized securities dealers and banks determined to present minimal
credit risk by the Advisor under the direction and supervision of the Funds'
respective Board of Directors/Trustees. In addition, the Funds will only engage
in repurchase agreements reasonably designed to fully secure during the term of
the agreement, the seller's obligation to repurchase the underlying security.
The Funds will monitor the market value of the underlying security during the
term of the agreement. If the seller defaults on its obligation to repurchase
and the value of the underlying security declines, the Funds may incur a loss
and may incur expenses in selling the underlying security. Repurchase agreements
are always for periods of less than one year, and are considered illiquid if not
terminable within seven days.
FOREIGN SECURITIES AND ADRs
The New Vision Small Cap Fund may invest up to 15% of its total assets in ADRs.
The Capital Accumulation Fund may also invest in ADRs, subject to the
restrictions applicable to investments in foreign securities discussed below. By
investing in ADRs rather than directly in foreign issuers' stock, the Funds may
avoid some currency and some liquidity risks. The information available for ADRs
is subject to the more uniform and more exacting accounting, auditing and
financial reporting standards of the domestic market or exchange on which they
are traded. U.S. dollar-denominated ADRs, which are traded in the U.S. on
exchanges or over the counter, are receipts typically issued by a U.S. bank or
trust company which evidence ownership of underlying securities of a foreign
corporation.
The Capital Accumulation Fund may invest up to 25% of its assets in the
securities of foreign issuers, although it currently holds or intends to hold no
more than 5% of its assets in such securities. The Capital Accumulation Fund may
purchase foreign securities directly, on foreign markets, or those represented
by ADRs, or other receipts evidencing ownership of foreign securities, such as
International Depositary Receipts and Global Depositary Receipts. Foreign
securities may involve additional risks, including currency fluctuations, risks
relating to political or economic conditions, and the potentially less stringent
investor protection and disclosure standards of foreign markets. These factors
could make foreign investments, especially those in developing countries, less
liquid and more volatile. In addition, the costs of foreign investing, including
withholding taxes, brokerage commissions and custodial costs are generally
higher than for U.S. investments. See the SAI for more information on investing
in foreign securities.
THE FUNDS MAY LEND THEIR PORTFOLIO SECURITIES.
Both Funds may lend portfolio securities to member firms of the New York Stock
Exchange and commercial banks with assets of one billion dollars or more,
although the New Vision Small Cap Fund does not intend to do so and the Capital
Accumulation Fund does not currently intend to lend more than 5% of its
portfolio securities. The advantage of such loans is that the Funds continue to
receive the equivalent of the interest earned or dividends paid by the issuers
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 Funds'
investment objective, policies and restrictions. 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.
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BORROWING
Both Funds may borrow money from banks (and pledge its assets to secure such
borrowing) for temporary or emergency purposes, but not for leverage. Such
borrowing may not exceed one third of the value of each Fund's total assets.
HIGH SOCIAL IMPACT INVESTMENTS
The Funds have both adopted nonfundamental policies that permit investments
which, with respect to the Capital Accumulation Fund, may be up to three
percent, and with respect to the New Vision Small Cap Fund, may be up to one
percent, of that Fund's assets in securities that offer a rate of return below
the then-prevailing market rate and that present attractive opportunities for
furthering each Fund's social criteria ("High Social Impact Investments"). These
securities are typically illiquid and unrated and are generally considered
noninvestment-grade debt securities, which involve a greater risk of default or
price decline than investment-grade securities. Through diversification and
credit analysis and limited maturity, investment risk can be reduced, although
there can be no assurance that losses will not occur. The High Social Impact
Investments committee of the Board of Directors/Trustees identifies, evaluates
and selects these investments, subject to ratification by the respective Board.
SOCIALLY RESPONSIBLE INVESTMENT CRITERIA
The Funds carefully review company policies and behavior regarding social issues
important to quality of life:
* environment *employee relations *product criteria
* weapons systems *nuclear energy *human rights
Once securities are determined to fall within the investment objective of a Fund
and are deemed financially viable investments, they are analyzed according to
the social criteria described below. These social screens are applied to
potential investment candidates by the Advisor in consultation with the
Subadvisors.
The following criteria may be changed by the respective Fund's Board of
Directors/Trustees without shareholder approval:
(1) The Funds avoid investing in companies that, in the Advisor's opinion,
have significant or historical patterns of violating environmental
regulations, or otherwise have an egregious environmental record.
Additionally, the Funds will avoid investing in nuclear power plant
operators and owners, or manufacturers of key components in the nuclear
power process.
(2) The Funds will not invest in companies that are significantly engaged
in weapons production. This includes weapons systems contractors and major
nuclear weapons systems contractors.
(3) The Funds will not invest in companies that, in the Advisor's opinion,
have significant or historical patterns of discrimination against
employees on the basis of race, gender, religion, age, disability or sexual
orientation, or that have major labor-management disputes.
(4) The Funds will not invest in companies that are significantly involved
in the manufacture of tobacco or alcohol products. The Funds will not
invest in companies that make products or offer services that, under proper
use, in the Advisor's opinion, are considered harmful.
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The Advisor will seek to review companies' overseas operations consistent with
the social criteria stated above.
While the Funds may invest in companies that exhibit positive social
characteristics, it makes no explicit claims to seek out companies with such
practices.
TOTAL RETURN
THE FUNDS MAY ADVERTISE TOTAL RETURN FOR EACH CLASS OF SHARES. TOTAL RETURN IS
BASED ON HISTORICAL RESULTS AND IS NOT INTENDED TO INDICATE FUTURE PERFORMANCE.
Total return is calculated separately for each class. It 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 of a class shows its overall
change in value, including changes in share price and assuming all of the class'
dividends and capital gain distributions are reinvested. A cumulative total
return reflects the class' performance over a stated period of time. An average
annual total return ("return with maximum load") 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 return usually will include the effect of paying any sales charge. Of course,
total returns will be higher 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. ("Lipper"). Further information about the
Funds' performance is contained in its Annual Report to Shareholders, which may
be obtained without charge.
MANAGEMENT OF THE FUND
THE FUNDS' BOARD OF DIRECTORS/TRUSTEES SUPERVISE THE FUNDS' ACTIVITIES AND
REVIEW THEIR CONTRACTS WITH COMPANIES THAT PROVIDE THEM WITH SERVICES.
The Capital Accumulation Fund is a series of Calvert World Values Fund, Inc. an
open-end management investment company organized as a Maryland corporation on
February 14, 1992. The other series is the International Equity Fund, a
socially-screened portfolio of equity securities from around the world.
The New Vision Small Cap 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 Trust is the Calvert Income
Fund.
Neither Fund is required to hold annual shareholder meetings, but special
meetings may be called for certain purposes such as electing Directors/Trustees,
changing fundamental policies, or approving a management contract. As a
shareholder, you receive one vote for each share of a Fund you own. Matters
affecting classes differently, such as Distribution Plans, will be voted on
separately by class.
CALVERT ASSET MANAGEMENT COMPANY, INC. SERVES AS ADVISOR TO THE FUNDS.
Calvert Asset Management Company, Inc. (the "Advisor") is both Funds' investment
advisor. The Advisor provides the Funds with investment supervision and
management; administrative services and office space; furnishes executive and
other personnel to the Funds; and pays the salaries and fees of all
Directors/Trustees who are affiliated persons of the Advisor. The Advisor may
also assume and pay certain advertising and promotional expenses of the Funds
and reserves the right to compensate broker-dealers in return for their
promotional or administrative services. The Funds pay all other operating
expenses as noted in the SAI.
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<PAGE>
CALVERT GROUP IS ONE OF THE LARGEST INVESTMENT MANAGEMENT FIRMS IN THE
WASHINGTON, D.C. AREA.
Calvert Group, Ltd., parent of the Fund's 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 assets in excess of
$5.0 billion and more than 200,000 shareholder and depositor accounts.
THE ADVISOR RECEIVES A FEE BASED ON A PERCENTAGE OF THE FUNDS' ASSETS.
The respective Investment Advisory Agreements between the Funds and the Advisor
both provide that the Advisor is entitled to a base annual fee, payable monthly,
of 0.80% of the Capital Accumulation Fund's, and 0.90% of the New Vision Small
Cap Fund's, average daily net assets. For its services during the fiscal year
ended September 30, 1997, pursuant to the Investment Advisory Agreements, the
Advisor received an investment advisory fee of 0.80% of the Capital Accumulation
Fund's average daily net assets, and 0.90% of New Vision Small Cap Fund's
average daily net assets.
With respect to the Capital Accumulation Fund, the Advisor may earn (or have its
fee reduced by) a performance adjustment based on the extent to which
performance of the Fund exceeds or trails the Standard & Poor's 400 Mid-Cap
Index:
Performance versus the Performance Fee
S&P 400 Mid-Cap Index Adjustment
10% to < 25% 0.01%
25% to < 40% 0.03%
40% or more 0.05%
For its services for fiscal year 1997, the Advisor received, pursuant to the
Investment Advisory Agreement, an advisory fee of 0.80% of the Fund's average
daily net assets, which included a performance adjustment of 0.0054%. The
Advisor may in its discretion defer its fees or assume the Fund's operating
expenses.
BROWN CAPITAL MANAGEMENT, INC., ("BROWN CAPITAL") IS THE INVESTMENT SUBADVISOR
FOR THE CAPITAL ACCUMULATION FUND.
Brown Capital of 809 Cathedral Street, Baltimore, Maryland has served as
subadvisor to the Fund since November 1, 1994. Brown Capital believes that
capital can be enhanced in times of opportunity and preserved in times of
adversity without timing the market. The firm uses a bottom-up approach that
incorporates growth-adjusted price earnings. Stocks purchased are generally
undervalued and have momentum, have earnings per share growth rates greater than
the market, are more profitable than the market, and have relatively low price-
earnings ratios. Its performance index is a blended 60% Russell 1000 Growth and
40% Russell 2000.
Eddie C. Brown is founder and President of Brown Capital. He has over 22 years
of investment experience, having served as a Vice President and Portfolio
Manager for 10 years at T. Rowe Price Associates immediately prior to starting
his own firm. Mr. Brown holds an M.S. in Electrical Engineering from New York
University, and an M.S. in Business Administration from the Indiana University
School of Business. Additionally, he is a professionally-designated Chartered
Financial Analyst (CFA) and Chartered Investment Counselor.
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The Investment Subadvisory Agreement between the Advisor provides that Brown
Capital is entitled to a base subadvisory fee of 0.25% of the Fund's average
daily net assets, paid by the Advisor out of the fee the Advisor receives from
the Fund. Brown Capital may earn (or have its base fee reduced by) a performance
adjustment based on the extent to which performance of the Fund exceeds or
trails the index agreed on with the Advisor:
Performance versus Performance Fee
the Index Adjustment
10% to < 25% 0.02%
25% to < 40% 0.05%
40% or more 0.10%
Payment by the Fund of a performance adjustment will be conditioned on: (1) the
performance of the Fund as a whole having exceeded the S&P 400 Mid-Cap Index;
and (2) payment of the performance adjustment not causing the Fund's performance
to fall below the S&P 400 Mid-Cap Index. The performance adjustment will be paid
by the Fund to the Advisor, which will then pass it on to the Subadvisor.
AWAD & ASSOCIATES ("AWAD") IS THE INVESTMENT SUBADVISOR TO THE NEW VISION SMALL
CAP FUND.
AWAD's principal business office is located at 477 Madison Avenue, New York, New
York 10022. As of June 30, 1997, AWAD had $724 million in assets under
management. AWAD adheres to a bottom-up, earnings-driven discipline with
emphasis on internal fundamental research, specializing in small capitalization
stocks, focusing on growth at a reasonable [value] price approach to stock
selection. AWAD's main objectives in asset management are to protect the
investor's capital, generate capital appreciation substantially in excess of
inflation and reduced-risk returns and provide returns in excess of applicable
stock and bond indices. All portfolio investments are regularly scrutinized to
provide a substantial risk/return benefit and to ensure that portfolios are
properly positioned relative to the Fund's investment objectives.
Since October 1, 1997, the New Vision Small Cap Fund has been managed by a team
of investment professionals from AWAD. The senior investment officer is James D.
Awad. Mr. Awad has been in the investment business since 1965, focusing on
research and portfolio management. Prior to forming AWAD, he was President of
BMI Capital, a successful money management firm he founded. In addition, he has
managed assets at Neuberger & Berman, Channing Management and First Investment
Corp. Mr. Awad has earned an MBA from Harvard Business School and a BS Cum Laude
from Washington & Lee University.
Dennison T. Veru is President of AWAD. Mr. Veru joined AWAD in 1992 coming from
Smith Barney Harris Upham where he was Senior Vice President of the firm's
Whiffletree Capital Management division specializing in small and medium
capitalization stocks. From 1988 through 1990, he was a Vice President of Broad
Street Investment Management. Prior to that, he was an Assistant Vice President
at Drexel Burnham Lambert. Mr. Veru is a graduate of Franklin and Marshall
College.
The Investment Subadvisory Agreement between the Advisor and AWAD provides that
AWAD is entitled to a base subadvisory fee of 0.40% of the Fund's average daily
net assets managed by AWAD. AWAD's fee is paid by the Advisor out of the fee the
Advisor receives from the Fund.
The Funds have obtained an exemptive order from the Securities and Exchange
Commission to permit them, pursuant to approval by the Board of
Directors/Trustees, to enter into and materially amend contracts with a
Subadvisor without shareholder approval. See "Investment Advisor and Subadvisor"
in the SAI for further details.
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CALVERT ADMINISTRATIVE SERVICES COMPANY PROVIDES ADMINISTRATIVE SERVICES FOR THE
FUND.
Calvert Administrative Services Company ("CASC"), an affiliate of the Advisor,
provides certain administrative services to the Fund, including the preparation
of regulatory filings and shareholder reports, the daily determination of its
net asset value per share and dividends, and the maintenance of its portfolio
and general accounting records. For providing such services, CASC receives an
annual fee, payable monthly, from both Funds of 0.10% of the respective Fund's
average daily net assets.
CALVERT DISTRIBUTORS, INC. SERVES AS UNDERWRITER TO MARKET THE FUNDS' SHARES.
Calvert Distributors, Inc. ("CDI") is both Funds' principal underwriter and
distributor. Under the terms of its underwriting agreement with the Funds, CDI
markets and distributes the Funds' 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 shareholder servicing agent for each
Fund. National Financial Data Services, Inc. ("NFDS"), 1004 Baltimore, Kansas
City, Missouri, 64105, is the transfer and dividend disbursing agent for each
Fund.
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SHAREHOLDER GUIDE
HOW TO OPEN AN ACCOUNT
GETTING STARTED
Regardless of the investment option you choose (see below), the enclosed
application must be completed and signed for each new account. When multiple
classes of shares are offered, please specify which class you wish to purchase.
Additional documents may be required for corporations, associations and certain
fiduciaries, & for investments in Calvert's tax-deferred retirement plans. For
more information about account options mentioned below, contact your broker or
our shareholder services department at 800-368-2748.
HOW TO BUY SHARES
(BE SURE TO SPECIFY WHICH CLASS YOU ARE BUYING)
New Accounts Additional Investments
$2,000 MINIMUM ( ) $250 MINIMUM
Please make your check payable Please make your check payable
to the Fund and mail it to the Fund and mail it
with your application to: with your investment slip to:
Calvert Group Calvert Group
PO Box 419544 PO 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 Mail 1004 BALTIMORE 1004 BALTIMORE
Kansas City, MO 64105-1807 Kansas City, MO 64105-1807
At the Calvert Visit the Calvert Office to make investments by check.
Office See the back cover page for the address.
Each Fund offers its shareholders three classes of shares:
CLASS A SHARES - FRONT END LOAD OPTION
Class A shares are sold with a front-end sales charge at the time of purchase.
Class A shares are not subject to a sales charge when they are redeemed.
CLASS B SHARES - BACK-END LOAD OPTION
Class B shares are sold without a sales charge at the time of purchase, but are
subject to a deferred sales charge if they are redeemed within six calendar
years after purchase. Class B shares will automatically convert to Class A
shares at the end of eight calendar years after purchase.
CLASS C SHARES - LEVEL LOAD OPTION
Class C shares are sold without a front-end sales charge at the time of
purchase. They are subject to a deferred sales charge if they are redeemed
within one year after purchase.
CLASS B AND C SHARES HAVE HIGHER EXPENSES THAN CLASS A SHARES.
Each Fund bears some of the costs of selling its shares under Distribution Plans
adopted pursuant to Rule 12b-1 under the 1940 Act. Payments under the Class A
Distribution Plan are limited to up to 0.35%
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with respect to the Capital Accumulation Fund, and up to 0.25% with respect to
the New Vision Small Cap Fund, annually of the average daily net asset value of
Class A shares, while payments under Class B and C Distribution Plan are 1.00%
of the average daily net assets attributable to their respective classes of each
Fund.
CONSIDERATIONS FOR DECIDING WHICH CLASS OF SHARES TO BUY.
Income distributions for Class A shares will probably be higher than those for
Class B and Class C shares, as a result of the distribution expenses described
above. (See also "Total Return") You should consider Class A shares if you
qualify for a reduced sales charge under Class A. Class A shares may also be
more appropriate for larger accounts or if you plan to hold the shares for
several years. Class C shares are not available for investments of $1 million or
more. The Funds will not normally accept any purchase of Class B shares in the
amount of $250,000 or more.
CLASS A SHARES
Class A shares are offered at net asset value ("NAV") plus a front-end sales
charge calculated as follows:
<TABLE>
<CAPTION>
Allowed
As a % of As a % of to Brokers as a
Amount of Offering Net Amount % of Offering
Investment Price Invested Price
<S> <C> <C> <C>
Less than $50,000 4.75% 4.99% 4.00%
$50,000 but less than $100,000 3.75% 3.90% 3.00%
$100,000 but less than $250,000 2.75% 2.83% 2.25%
$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% 0.00%*
</TABLE>
* CDI may pay the dealer a finder's fee of up to 0.50% of the amount of purchase
on purchases of over $1 million. 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 Class A 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 Class A shares held in accounts maintained by
that firm.
CLASS A DISTRIBUTION PLAN
Each Fund has adopted a Distribution Plan with respect to its Class A shares
(the "Class A Distribution Plan"), which provides for payments at a maximum
rate of 0.35% with respect to the Capital Accumulation Fund, and 0.25% with
respect to the New Vision Small Cap Fund, of the average daily net asset value
of Class A shares, to pay expenses associated with the distribution and
servicing of Class A shares. Amounts paid by the Fund to CDI under the Class A
Distribution Plan are used to pay to
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broker-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 Class A 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, Class A Distribution
Plan expenses for the Capital Accumulation Fund were 0.35% and for the New
Vision Small Cap Fund were 0.25%.
CLASS B SHARES
Class B shares are offered at net asset value, without a front-end sales charge.
With certain exceptions, the Portfolio may impose a deferred sales charge at the
time of redemption as follows:
CONTINGENT DEFERRED SALES
CHARGE AS A PERCENTAGE OF
REDEMPTION DURING NET ASSET VALUE AT REDEMPTION
----------------- -----------------------------
1st Year Since Purchase 5%
2nd Year Since Purchase 4%
3rd Year Since Purchase 4%
4th Year Since Purchase 3%
5th Year Since Purchase 2%
6th Year Since Purchase 1%
7th Year Since Purchase and Thereafter None
No deferred sales charge is imposed on amounts redeemed after six years from
purchase. If imposed, the deferred sales charge is deducted from the redemption
proceeds otherwise payable to you. The deferred sales charge is retained by
CDI. See "Calculation of Contingent Deferred Sales Charges and Waiver of Sales
Charges" below.
Class B shares that have been outstanding for eight calendar years will
automatically convert to Class A shares, which are subject to a lower
Distribution Plan charge, without imposition of a front-end sales charge or
exchange fee. The Class B shares so converted will no longer be subject to the
higher expenses borne by Class B shares. Because the net asset value per share
of the Class A shares may be higher or lower than that of the Class B shares at
the time of conversion, although the dollar value will be the same, a
shareholder may receive more or less Class A shares than the number of Class B
shares converted. Under current law, it is the Advisor's opinion that such a
conversion will not constitute a taxable event under federal income tax law. In
the event that this ceases to be the case, the Board of Trustees will consider
what action, if any, is appropriate and in the best interests of the Class B
shareholders.
CLASS B DISTRIBUTION PLAN
The Portfolio has adopted a Distribution Plan with respect to its Class B shares
(the "Class B Distribution Plan"), which provides for payments at an annual rate
of up to 1.00% of the average daily net asset value of Class B shares, to pay
expenses of the distribution of Class B shares. Amounts paid by the Portfolio
under the Class B Distribution Plan are currently used by CDI to pay others (1)
a commission at the time of purchase of 4% of the value of each share sold;
and/or (2) service fees at an annual rate of 0.25% of the average daily net
asset value of shares sold by such others, beginning in the 13th month after
purchase.
CLASS C SHARES
Class C shares are not available through all dealers. Class C shares are offered
at net asset value, without a front-end sales charge. With certain exceptions,
the Portfolio will impose a deferred sales charge of
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1.00% on shares redeemed during the first year after purchase. If imposed, the
deferred sales charge is deducted from the redemption proceeds otherwise payable
to you. The deferred sales charge is retained by CDI. See "Calculation of
Contingent Deferred Sales Charges and Waiver of Sales Charges" below
CLASS C DISTRIBUTION PLAN
Each Fund has adopted a Distribution Plan with respect to its Class C shares
(the "Class C Distribution Plan"), which provides for payments at an annual rate
of up to 1.00% of the average daily net asset value of Class C shares, to pay
expenses of the distribution and servicing of Class C shares. Amounts paid by
the Fund under the Class C Distribution Plan are currently used by CDI to pay
broker-dealers and other selling firms (1) a commission at the time of purchase
of 1.00% of the value of each share sold, and (2) beginning in the 13th month
after purchase, quarterly compensation at an annual rate of up to 0.75%, plus a
service fee of up to 0.25%, of the average daily net asset value of each share
sold by such others. During the fiscal year ended September 30, 1997, Class C
Distribution Plan expenses for the Capital Accumulation Fund were 1.00% of the
average daily net assets. For the period ended September 30, 1997, distribution
expenses for the New Vision Small Cap Fund were 1.00% of the average daily net
assets.
CALCULATION OF CONTINGENT DEFERRED SALES CHARGE AND WAIVER OF SALES CHARGES
Class B and Class C shares that are redeemed will not be subject to a contingent
deferred charge to the extent that the value of such shares represents (1)
reinvestment of dividends or capital gains distributions, (2) shares held more
than six years (more than one year for Class C) or (3) capital appreciation of
shares redeemed. Any contingent deferred sales charge is imposed on the net
asset value of the shares at the time of redemption or purchase, whichever is
lower. Upon request for redemption, shares not subject to the contingent
deferred sales charge will be redeemed first. Thereafter, shares held the
longest will be the first to be redeemed.
The contingent deferred sales charge on Class B Shares will be waived in the
following circumstances: (1) redemption upon the death or disability of the
shareholder, plan participant, or beneficiary ("disability" shall mean a total
disability as evidenced by a determination by the federal Social Security
Administration); (2) minimum required distributions from retirement plan
accounts for shareholders 70 1/2 and older (with the maximum amount subject to
this waiver being based only upon the shareholder's Calvert retirement
accounts); (3) return of an excess contribution or deferral amounts, pursuant to
sections 408(d)(4) or (5), 401(k)(8), or 402)(g)(2), or 401(m)(6) of the
Internal Revenue Code; (4) involuntary redemptions of accounts under procedures
set forth by the Fund's Board of Trustees; (5) a single annual withdrawal under
a systematic withdrawal plan of up to 10% per year of the shareholder's account
balance (minimum account balance $50,000 to establish).
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. CDI may receive reimbursement of eligible marketing and distribution
expenses from the Fund's Rule 12b-1 Distribution Plan and in compliance with the
rules of the NASD.
Broker-dealers or others may receive different levels of compensation depending
on which class of shares they sell. Payments pursuant to a Distribution Plan are
included in the operating expenses of the class.
WHEN YOUR ACCOUNT WILL BE CREDITED
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<PAGE>
Your purchase will be processed at the next NAV calculated after your order is
received and accepted. All of your purchases must be made in US dollars and
checks must be drawn on US banks. No cash will be accepted. The Funds reserve
the right to suspend the offering of shares for a period of time or to reject
any specific purchase order. If your check does not clear your bank, your
purchase will be canceled and you will be charged a $10 fee plus costs incurred
by the Funds.
When you purchase by check or with Calvert Money Controller, the purchase will
be on hold for up to 10 business days from the date of receipt. During the hold
period, any redemptions will be held until the transfer agent is reasonably
satisfied that the purchase payment has been collected. To avoid this hold
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 Transfer 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 CDI may enter confirmed purchase orders on behalf of customers by
phone, with payment to follow within a certain number of days of the order as
specified by the program. If payment is not received in the time specified, the
financial institution or broker-dealer could be held liable for resulting fees
or losses.
TAX-SAVING RETIREMENT PLANS
Calvert Group also offers its shareholders several tax-deferred retirement plans
that allow you to invest for retirement and shelter your investment income from
current taxes. Please contact us if you wish to obtain more information about
the investment options listed below. Minimum deposits may differ from those
listed in the "How to Buy Shares" chart. Also, reduced sales charges may apply
(see Exhibit A to this prospectus).
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.
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.
Simple IRAs and Simplified Employee Pension Plan (SEP IRAs): available to
self-employed people and their partners, or to corporations.
403(b)(7) Custodial Accounts: available to employees of most non-profit
organizations and public schools and universities.
OTHER CALVERT GROUP FEATURES
CALVERT INFORMATION NETWORK
FOR 24 HOUR PERFORMANCE AND ACCOUNT INFORMATION CALL 800-368-2745 OR VISIT
HTTP://WWW.CALVERTGROUP.COM
You can obtain up to the minute performance and pricing information, verify
account balances, and authorize certain transactions with the convenience of one
phone call, 24 hours a day.
ACCOUNT SERVICES
By signing up for services when you open your account, you avoid having to
obtain a signature guarantee. If you wish to add services at a later date, a
signature guarantee to verify your signature may
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be obtained from any bank, trust company and savings and loan association,
credit union, broker-dealer firm or member of a domestic stock exchange. A
notary public cannot provide a signature guarantee.
CALVERT MONEY CONTROLLER
Calvert Money Controller allows you to purchase or sell shares anytime from
anywhere with ease, without the time delay of mailing a check or the added
expense of wiring funds. Use this service to transfer up to $300,000
electronically. Allow one or two business days after you place your request for
the transfer to take place. Money transferred to purchase new shares will be
subject to a hold of up to 10 business days before redemption requests will be
honored. Transaction requests must be received by 4 p.m. ET. You may request
this service on your initial account application.
TELEPHONE TRANSACTIONS
You may purchase, redeem, or exchange shares, wire funds and use Calvert Money
Controller by telephone if you have pre-authorized service instructions. You
receive this service automatically when you open your account unless you elect
otherwise. For our mutual protection, the Fund, the shareholder servicing agent
and their affiliates use precautions such as verifying shareholder identity and
recording telephone calls to confirm instructions given by phone. A confirmation
statement is sent for most transactions; please review this statement and verify
the accuracy of your transaction immediately.
EXCHANGES
Calvert Group offers a wide variety of investment options that includes common
stock funds, tax-exempt and corporate bond funds, and money market funds (call
your broker or Calvert representative for more information). We make it easy for
you to purchase shares in other funds should your investment goals change. The
exchange privilege offers flexibility, by allowing you to exchange shares on
which you have already paid a sales charge from one mutual fund to another at no
additional charge.
Complete and sign an account application, taking care to register your new
account in the same name and taxpayer identification number as your existing
Calvert account(s). Exchange instructions may then be given by telephone if
telephone redemptions have been authorized and the shares are not in certificate
form.
Before you make an exchange, please note the following:
- - Each exchange represents the sale of shares of one portfolio and the
purchase of shares of another. Therefore, you could realize a taxable gain
or loss.
- - No CDSC is imposed on exchanges of shares subject to a CDSC at the time of
the exchange. The applicable CDSC is imposed at the time the shares
acquired by the exchange are redeemed.
- - Shareholders (and those managing multiple accounts) who make two purchases
and two exchange redemptions of shares of the same Portfolio during a six
months period will be given written notice and may be prohibited from
placing additional investments. This policy does not prohibit a shareholder
from redeeming shares of any Portfolio, and does not apply to trades solely
among money market funds.
- - The Fund reserves the right to terminate or modify the exchange privilege
with 60 days written notice.
COMBINED GENERAL MAILINGS
JOIN IS IN OUT EFFORTS TO CONSERVE PAPER AND SAVE ON POSTAGE
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If you have multiple accounts with Calvert, you may receive combined mailings of
shareholder information, such as account statements, confirmations of
transactions, prospectuses and semi-annual and annual reports.
SPECIAL SERVICES AND CHARGES
The Funds pay for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account or a stop payment on a draft. You may be required to pay a fee for
these special services; for example, the fee for stop payments is $25.
If you are purchasing shares 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.
MINIMUM ACCOUNT BALANCE IS $1,000 PER FUND, PER CLASS
Please maintain a balance in each of your Fund accounts of at least $1,000. If
the balance in your account falls below the $1,000 minimum during a month, the
account may be closed and the proceeds mailed to the address of record. You
will receive a notice that your account is below the minimum, and will be closed
if the balance is not brought up to the required minimum amount within 30 days.
SYSTEMATIC CHECK REDEMPTIONS
If you maintain an account with $10,000 or more, you may have up to two (2)
redemption checks for $100 or more sent to you on the 15th of each month, simply
by sending a letter with all the information, including your account numbers,
and the dollar amount. If you would like a regular check mailed to another
person or place, your letter must be signature guaranteed. Unless they otherwise
qualify for a waiver, Class B or Class C shares redeemed by Systematic Check
Redemption will be subject to the Contingent Deferred Sales Charge.
DIVIDENDS, CAPITAL GAINS AND TAXES
Each year, both Funds distribute substantially all of their respective net
investment income to their shareholders.
Dividends from a Fund's net investment income are declared and paid annually.
Net investment income consists of interest income, net short-term capital gains,
if any, and dividends declared and paid on investments, less expenses.
Distributions of net short-term capital gains (treated as dividends for tax
purposes) and net long-term capital gains, if any, are normally paid once a
year; however, the Funds do not anticipate making any such distributions unless
available capital loss carryovers have been used or have expired. Dividend and
distribution payments will vary between classes; dividend payments are
anticipated to be generally higher for Class A shares.
DIVIDEND PAYMENT OPTIONS (AVAILABLE MONTHLY OR QUARTERLY)
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 from any Calvert Group Fund or Portfolio may be automatically
invested in an identically registered account in any other Calvert Group Fund at
NAV. If reinvested in the same Fund account, new shares will be purchased at NAV
on the reinvestment date, which is generally 1 to 3 days prior to the payment
date. You must notify the Funds in writing to change your payment options. If
you elect to have dividends and/or distributions paid in cash, and the US Postal
Service cannot deliver the check, or if it remains uncashed for an extended
period, it, as well as future
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<PAGE>
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 your 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, 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, your Fund will mail you Form 1099-DIV indicating the federal tax
status of dividends and any capital gain distributions paid to you during the
past year. Generally, dividends and distributions are taxable in the year they
are paid. However, any dividends and distributions paid in January but declared
during the prior three months are taxable in the year declared. Dividends and
distributions are taxable to you regardless of whether they are taken in cash or
reinvested. Dividends, including short-term capital gains, are taxable as
ordinary income. Distributions from long-term capital gains are taxable as
long-term capital gains, regardless of how long you have owned shares.
You may realize a capital gain or loss when you sell or exchange shares. This
capital gain or loss will be short- or long-term, depending on how long you have
owned the shares which were sold. In January, the Portfolios will mail you Form
1099-B indicating the total amount of all sales, including exchanges. You should
keep your annual year-end account statements to determine the cost (basis) of
the shares to report on your tax returns.
OTHER TAX INFORMATION
In addition to federal taxes, you may be subject to state or local taxes on your
investment, depending on the laws in your area. You will be notified to the
extent, if any, that dividends reflect interest received from US government
securities. Such dividends may be exempt from certain state income taxes.
TAXPAYER IDENTIFICATION NUMBER
If we do not have your correct Social Security or Taxpayer Identification Number
("TIN") and a signed certified application or Form W-9, Federal law requires us
to withhold 31% of your dividends, and possibly 31% of 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 (closed) at
the current NAV on the date of redemption. Calvert Group reserves the right to
reject any new account or any purchase order for failure to supply a certified
TIN.
HOW TO SELL SHARES
You may redeem all or a portion of your shares on any business day. Your shares
will be redeemed at the next NAV calculated after your redemption request is
received (less any applicable CDSC). The proceeds will normally be sent to you
on the next business day, but if making immediate payment could adversely affect
the Funds, 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. Remember, investments made by check or
Calvert Money Controller may be subject to a hold before shares can be redeemed.
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
25
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circumstances as determined by the Securities and Exchange Commission,
redemptions may be suspended or payment dates postponed.
NET ASSET VALUE - "NAV"
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. For Portfolios with more than
one class of shares, the NAVs of each class will vary daily depending on the
number of shares outstanding for each class.
Portfolio securities and other assets are valued based on market quotations,
except that securities maturing within 60 days are valued at amortized cost.
Money Market securities are valued according to the "amortized cost" method,
which is intended to stabilize the NAV at $1 per share. If quotations are not
available, securities are valued by a method that the particular Fund's Board of
Trustees/Directors believes accurately reflects fair value.
The NAV is calculated at the close of each business day, which coincides with
the closing of the regular session of the New York Stock Exchange (normally 4
p.m. ET). Both Funds are open for business each day the New York Stock Exchange
is open. All purchases will be confirmed and credited to your account in full
and fractional shares (rounded to the nearest 1/1000 of a share).
FOLLOW THESE SUGGESTIONS TO ENSURE TIMELY PROCESSING OF YOUR REDEMPTION REQUEST
BY TELEPHONE
You may redeem shares from your account by telephone and have your money mailed
to your address of record or electronically transferred or wired to a bank you
have previously authorized. A charge of $5 may be imposed on wire transfers of
less than $1,000.
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WRITTEN REQUESTS
CALVERT GROUP, P.O. BOX 419544, KANSAS CITY, MO 64141-6544
Your letter should include your account number and fund and the number of shares
or the dollar amount you are redeeming. Please provide a daytime telephone
number, if possible, for us to call if we have questions. If the money is being
sent to a new bank, person, or address other than the address of record, your
letter must be signature guaranteed.
The following requirements may also apply to your account:
Type of Registration Requirements
Corporations, Letter of instruction and corporate resolution,
signed by person(s) authorized to act on the
account, accompanied by signature guarantee(s).
Associations
Trusts Letter of instruction signed by the Trustee(s) (as
Trustees), 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.)
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<PAGE>
EXHIBIT A
REDUCED SALES CHARGES (CLASS A ONLY)
You may qualify for a reduced sales charge through several purchase plans
available. You must notify the Funds 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 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:
has been in existence for more than six months,
has a purpose other than acquiring shares at a discount, and
satisfies uniform criteria which enable CDI and brokers offering shares to
realize economies of scale in distributing such shares.
A qualified group must have more than 10 members, must be available to arrange
for group meetings between representatives of CDI or brokers distributing
shares, must agree to include sales and other materials related to the Funds in
its publications and mailings to members at reduced or no cost to CDI or
brokers.
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) or 401(k) of the Code
if, at the time of purchase, (i) Calvert Group has been notified in writing that
the 403(b) or 401(k) plan has at least 200 eligible employees and is not
sponsored by a K-12 school district, or (ii) the cost or current value of shares
a 401(k) plan has in Calvert Group of Funds (except money market funds) is at
least $1 million.
Neither the Funds, 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.
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<PAGE>
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."
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 NAV
Except for money market funds, if you make a purchase at NAV, you may exchange
that amount to another Calvert Group Fund at no additional sales charge.
REINSTATEMENT PRIVILEGE
If you redeem shares and then within 30 days decide to reinvest in the same
Fund, you may do so at the net asset value next computed after the reinvestment
order is received, without a sales charge. You may use the reinstatement
privilege only once. The Funds reserve the right to modify or eliminate this
privilege.
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Prospectus
March 31, 1998
Calvert Capital Accumulation Fund
Calvert New Vision Small Cap Fund
To Open an Account:
800-368-2748
Performance 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
Address: http://www.calvertgroup.com
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
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<PAGE>
THE CALVERT FUND
CALVERT NEW VISION SMALL CAP FUND
STATEMENT OF ADDITIONAL INFORMATION
MARCH 31, 1998
INVESTMENT ADVISOR SHAREHOLDER SERVICING AGENT
Calvert Asset Management Company, Inc. Calvert Shareholder Services,
4550 Montgomery Avenue Inc.
Suite 1000N 4550 Montgomery Avenue
Bethesda, Maryland 20814 Suite 1000N
Bethesda, Maryland 20814
INDEPENDENT ACCOUNTANT TRANSFER AGENT
Coopers & Lybrand, L.L.P. National Financial Data
250 W. Pratt Street Services, Inc.
Baltimore, Maryland 21201-2304 1004 Baltimore 6 th Floor
Kansas City, MO. 64105
INVESTMENT SUBADVISOR PRINCIPAL UNDERWRITER
Awad & Associates Calvert Distributors, Inc.
477 Madison Avenue 4550 Montgomery Avenue
New York, NY 10022 Suite 1000N
Bethesda, Maryland 20814
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Investment Objective and Policies 1
Investment Restrictions 3
Dividends, Distributions and Taxes 4
Net Asset Value 5
Calculation of Total Return 5
Purchase and Redemption of Shares 6
Reduced Sales Charge (Class A) 6
Advertising 7
Trustees and Officers 7
Investment Advisor and Subadvisor 10
Method of Distribution 11
Transfer and Shareholder Servicing Agent 11
Fund Transactions 12
Independent Accountant and Custodians 12
General Information 12
Financial Statements 12
Appendix 13
Glossary of Permitted Investments 13
</TABLE>
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION--March 31, 1998
THE CALVERT FUND
CALVERT NEW VISION SMALL CAP FUND
4550 Montgomery Avenue, Bethesda, Maryland 20814
- ------------------------------------------------------------------------------
New Account (800) 368-2748 Shareholder
Information: (301) 951-4820 Services: (800) 368-2745
- --------------------------------------------------------------------------------
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 March 31, 1998, which may be obtained free of charge by
writing the Fund at the above address or calling the Fund.
INVESTMENT OBJECTIVE
Calvert New Vision Small Cap Fund (the "Fund") is a diversified series of
The Calvert Fund, an open-end management investment company. The investment
objective of the Fund is to achieve long-term capital appreciation by investing
primarily in the equity securities of small companies (currently those with a
total capitalization for initial purchases of less than $1 billion at the time
of the Fund's initial investment) publicly traded in the United States. The
following discussion supplements the discussion in the Prospectus. Unless
otherwise specified, the investment objective, programs and restrictions of the
Fund are not fundamental policies. The operating policies of the Fund are
subject to change by its Board of Trustees without shareholder approval.
In seeking capital appreciation, the Fund invests primarily in equity
securities of small capitalized growth companies that have historically
exhibited exceptional growth characteristics and that, in the Adviser's opinion,
have strong earnings potential relative to the U.S. market as a whole. The Fund
will take reasonable risks in seeking to achieve its investment objective. There
is, of course, no assurance that the Fund will be successful in meeting its
objective since there is risk involved in the ownership of all equity
securities. The Fund will invest in enterprises that make a significant positive
contribution to our society through their products and services and through the
way they do business.
The Fund's investment philosophy emphasizes sustained growth and
concentrates on the securities of issuers not generally recognized by the
investment community that have a consistent earnings-per-share growth, a unique
product or service, conservative accounting and financial policies, and
management capable of long-term growth. While the Fund's policies may, from time
to time, result in income return, any such return will be incidental to the
objective of long-term capital appreciation.
Under normal market conditions, the Fund strives to be fully invested. In a
declining market, the Fund may raise cash or employ other defensive strategies
in an attempt to protect against the decline of its investments.
SPECIAL RISKS OF THE FUND'S DEFENSIVE STRATEGIES
The Fund may purchase put and call options, and write (sell) covered put
and call options on equity and debt securities and stock or debt indices. The
Fund may purchase or write both exchange-traded and OTC options. These defensive
strategies may also be used with respect to futures.
An option is a legal contract that gives the holder the right to buy or
sell a specified amount of the underlying interest at a fixed or determinable
price (called the exercise or strike price) upon exercise of the option. A
futures contract is an agreement to take delivery or to make delivery of a
standardized quantity and quality of a certain commodity during a particular
month in the future at a specified price. Successful use of the Fund's
investment strategies with respect to futures and options depends on the ability
to predict movements of the overall securities, currency and interest rate
markets, which is a different skill than that required to select equity and debt
investments. There can be no assurance that a chosen strategy will succeed.
There may not be an expected correlation between price movements of a
hedging instrument and price movements of the investment being hedged, so that
the Fund may lose money notwithstanding employment of the hedging strategy.
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<PAGE>
While the Fund's investment strategies can reduce risk of loss by
offsetting the negative effect of unfavorable price movements, they can also
reduce the opportunity for gain by offsetting the positive effect of a favorable
price movement. If the variance is great enough, a decline in the price of an
instrument may result in a loss to the Fund.
The Fund may be required to cover its assets in a segregated account. If an
investment cannot be liquidated at the time the Subadvisor believes it is best
for the Fund, the Fund might be required to keep assets on reserve that it
otherwise would not have had to maintain. Similarly, it might have to sell a
security at an inopportune time in order to maintain the reserves.
FUTURES AND OPTIONS
The Fund is authorized to invest in certain types of futures, options on
equities and equity indexes, warrants and stock rights for hedging purposes
only, that is, protecting against the risk of market movements that may
adversely affect the value of the Fund's securities or the price of securities
that the Fund is considering purchasing. Although a hedging transaction may
partially protect the Fund from a decline in the value of a particular security
or its portfolio generally, the cost of the transaction will reduce the
potential return on the security or the portfolio. The Fund may only write call
options on securities that it owns (i.e., that are "covered"). No more than 50%
of the Fund's total assets shall be subject to outstanding options contracts.
The Fund presently intends to cease writing options in the event that 25% of
total assets are subject to outstanding options contracts. As an operating
policy, the Fund may purchase a call or put option on securities (including
combinations of options such as straddles or spreads) only if the value of that
option premium, when aggregated with the premiums of all other options on
securities held by the Fund, does not exceed 5% of the Fund's assets. Following
is a summary of the futures, options, warrants and stock rights in which the
Fund may invest:
In exchange for a premium, a call option on a security or security index
gives the holder (buyer) of the option the right (but not the obligation) to
purchase the underlying security or security index at a specified price (the
exercise price) at any time until a certain date (the expiration date). The
writer (seller) of a call option has the corresponding obligation to deliver the
underlying security in the event the option is exercised by the holder of the
option. A call option on a securities index is similar to a call option on an
individual security, except that the value of the option depends on the weighted
value of the group of securities comprising the index and all settlements are to
be made in cash. A call option may be terminated by the writer (seller) by
entering into a closing purchase transaction in which the writer purchases an
option of the same series as the option previously written.
The Fund may purchase put options on a security or security index. A put
option gives the holder (buyer) of the option the right (but not the obligation)
to sell a security at the exercise price at any time until the expiration date.
Upon exercise by the purchaser, the writer of a put option has the obligation to
purchase the underlying security at the exercise price. A put option on a
securities index is similar to a put option on an individual security, except
that the value of the option depends on the weighted value of the group of
securities comprising the index and all settlements are made in cash. Purchasing
a call or put option involves the risk that the Fund may lose the premium it
paid plus transactions costs.
With respect to securities and securities indexes, the Fund may write
(sell) call and put options on an exchange or over-the-counter. Call options on
portfolio securities will be covered since the Fund will own the underlying
securities. Call options on securities indices will be written only to hedge in
an economically appropriate way portfolio securities which are not otherwise
hedged with options or financial futures contracts and will be covered by
maintaining sufficient collateral to cover the option.
The Fund may write (sell) call and put options in order to obtain a return
on its investments from the premiums received and will retain the premiums
whether or not the options are exercised. Any decline in the market value of
portfolio securities will be offset to the extent of the premiums received (net
of transaction costs). If an option is exercised, the premium received on the
option will effectively increase the exercise price or reduce the difference
between the exercise price and market value. During the option period, the
writer of a call option gives up the opportunity for appreciation in the market
value of the underlying security or currency above the exercise price. The
writer retains the risk of loss should the price of the underlying security
decline.
The Fund may also write a call or put option which it has previously
purchased prior to the purchase (in the case of a call) or the sale (in the case
of a put) of the underlying security. Any such sale would result in a net gain
or loss depending on whether the amount received on the sale is more or less
than the premium and other transaction costs paid on the call or put which is
sold.
2
<PAGE>
The Fund may close out its position in a futures contract or an option on a
futures contract only by entering into an offsetting transaction on the exchange
on which the position was established and only if there is a liquid secondary
market for the futures contract. If it is not possible to close a futures
position entered into by the Fund, it could be required to make continuing daily
cash payments to meet margin requirements 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 variation 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. 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. The correlation
is imperfect between movements in the prices of futures or option contracts, and
the movements of prices of the securities which are subject to the hedge. If the
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.
Engaging in transactions in financial futures contracts involves certain
risks, such as the possibility of an imperfect correlation between futures
market prices and cash market prices and the possibility that the Advisor or
Subadvisor could be incorrect in its expectations as to the direction or extent
of various interest rate movements, in which case the Fund's return might have
been greater had hedging not taken place. There is also the risk that a liquid
secondary market may not exist. The risk in purchasing an option on a financial
futures contract is that the fund will lose the premium it paid. Also, there may
be circumstances when the purchase of an option on a financial futures contract
would result in a loss to the Fund while the purchase or sale of the contract
would not have resulted in a loss.
The Fund will not purchase or sell any financial futures contract or
related option if, immediately thereafter, the sum of the cash or U.S. Treasury
bills committed with respect to its existing futures and related options
positions and the premiums paid for related options would exceed 5% of the
market value of its total assets. At the time of purchase of a futures contract
or a call option on a futures contract, an amount of cash, U.S. Government
securities or other appropriate liquid debt or equity securities equal to the
market value of the futures contract, minus the Fund's initial margin deposit
with respect thereto, will be deposited in a segregated account with the Fund's
custodian bank to collateralize fully the position and thereby ensure that it is
not leveraged. The extent to which the Fund may enter into financial futures
contracts and related options may also be limited by the requirements of the
Internal Revenue Code of 1986 for qualification as a regulated investment
company.
Warrants and stock rights are almost identical to call options in their
nature, use and effect except that they are issued by the issuer of the
underlying security rather than an option writer, and they generally have longer
expiration dates than call options. The Fund may invest up to 5% of its net
assets in warrants and stock rights, but no more than 2% of its net assets may
be invested in warrants and stock rights not listed on the New York Stock
Exchange or the American Stock Exchange.
NONINVESTMENT GRADE (HIGH YIELD/HIGH RISK) DEBT SECURITIES
The Fund may invest up to 5% of its total assets in lower quality debt
securities (generally those rated BB or lower by S&P or Ba or lower by Moody's),
or in unrated securities determined by the Advisor to be comparable. 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. This may also impact the Fund's Board of Trustees' ability to accurately
value these securities and the Fund's assets. 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 are
rated securities, and any adverse publicity and investor perceptions, whether or
not based on fundamental analysis, may make them less marketable.
The Fund will not purchase any securities rated lower than C (for an
explanation of Corporate Bond and Commercial Paper ratings, see Appendix). The
quality limitation set forth in the investment policy is determined immediately
upon the Fund's acquisition of a security. Accordingly, any later change in
ratings may not be considered when determining whether an investment complies
with the Fund's investment policy. Credit ratings evaluate the safety of
principal and interest payments, not market value risk of the securities.
When purchasing high-yielding securities, rated or unrated, the Subadvisor
prepares its own careful credit analysis to attempt to identify those issuers
whose financial condition is adequate to meet future obligations or is
3
<PAGE>
expected to be adequate in the future. The Subadvisor also continuously monitors
the issuers of the securities in the Fund to assure that their financial
condition continues to be adequate. Through portfolio diversification and credit
analysis, investment risk can be reduced, although there can be no assurance
that losses will not occur.
LENDING PORTFOLIO SECURITIES
Although it does not currently intend to do so, the Fund may lend its
portfolio securities to member firms of the New York Stock Exchange and
commercial banks with assets of one billion dollars or more. Loans must be
secured continuously in the form of cash or cash equivalents such as U.S.
Treasury bills; the amount of the 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 advantage of such loans is that the Fund continues to receive the
equivalent of the interest earned or dividends paid by the issuers 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 delivery 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 or Subadvisor deems creditworthy and only on
terms the Advisor believes should compensate for such risk. On termination of
the loan, the borrower is obligated to return the securities to the Fund. The
Fund will recognize any gain or loss in the market value of the securities
during the loan period. The Fund may pay reasonable custodial fees in connection
with the loan.
INVESTMENT RESTRICTIONS
FUNDAMENTAL INVESTMENT RESTRICTIONS
The Fund has adopted the following investment restrictions which 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. The Fund may not:
1. With respect to 75% of its total 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 its total assets would be invested in
securities of that issuer.
2. Concentrate 25% or more of the value of its total 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, and
repurchase agreements secured thereby.
3. Make loans of more than one-third of the total assets of the
Fund, other than through the purchase of money market instruments and
repurchase agreements or by the purchase of bonds, debentures or other
debt securities, or the lending of portfolio securities as detailed in
the prospectus, or as permitted by law. The purchase by the Fund of
all or a portion of an issue of publicly or privately distributed debt
obligations in accordance with its investment objective, policies and
restrictions, shall not constitute the making of a loan.
4. Underwrite the securities of other issuers, except as permitted
by the Board of Trustees within applicable law, and except to the
extent that in connection with the disposition of its portfolio
securities, the Fund may be deemed to be an underwriter.
5. Issue senior securities or borrow money in an amount exceeding
one-third of the Fund's total assets, or as permitted by law. In order
to secure any permitted borrowings under this section, the Fund may
pledge, mortgage or hypothecate its assets.
6. Except as required in connection with permissible options,
futures and commodity activities of the Fund, invest in commodities,
commodity futures contracts, or real estate, although
4
<PAGE>
it may invest in securities which are secured by real estate or real estate
mortgages and securities of issuers which invest or deal in commodities,
commodity futures, real estate or real estate mortgages and provided that
it may purchase or enter into futures contracts and options on futures
contracts, foreign currency futures, interest rate futures and options
thereon.
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:
7. Invest, in the aggregate, more than 15% of its net assets in
illiquid securities. Purchases of securities outside the U.S. that are
not registered with the SEC or marketable in the U.S. are not PER SE
illiquid.
8. With respect to 75% of its total assets, invest 10% or more of
its assets in the voting securities of any one issuer.
For purposes of the Fund's concentration policy contained in restriction
(2), above, the Fund classifies the respective industries according to a revised
version of William O'Neil's INVESTOR'S BUSINESS DAILY industry classification.
Any investment restriction (with the exception of borrowings and illiquid
holdings) 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 an acquisition of securities or utilization of assets
and results therefrom.
DIVIDENDS, DISTRIBUTIONS, AND TAXES
The Fund declares and pays dividends from net investment income on an
annual basis. Distributions of realized net capital gains, if any, are normally
paid once a year; however, the Fund does not intend to make any such
distributions unless available capital loss carryovers, if any, have been used
or have expired. Dividends and distributions paid may differ among the classes.
Investors should note that the Internal Revenue Code (the "Code") may
require investors to exclude the initial sales charge, if any, paid on the
purchase of Fund shares from the tax basis of those shares if the shares are
exchanged for shares of another Calvert Group Fund within 90 days of purchase.
This requirement applies only to the extent that the payment of the original
sales charge on the shares of the Fund causes a reduction in the sales charge
otherwise payable on the shares of the Calvert Group Fund acquired in the
exchange, and investors may treat sales charges excluded from the basis of the
original shares as incurred to acquire the new shares.
The Fund is required to withhold 31% of any dividends and 31% of each
redemption transaction occurring in the Fund 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 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.
The Fund is required 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 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, certain foreign partnerships and foreign
corporations are generally not subject to either requirement but may instead be
subject to withholding under sections
5
<PAGE>
1441 or 1442 of the Code. Shareholders claiming exemption from backup
withholding and broker reporting should call or write the Fund for further
information.
NET ASSET VALUE
The public offering price of the shares of the Fund is the respective net
asset value per share (plus, for Class A shares, the applicable sales charge).
The net asset value fluctuates based on the respective market value of the
Fund's investments. The net asset value per share for each class is determined
every business day at the close of the regular session of the New York Stock
Exchange (normally 4:00 p.m. Eastern time) and at such other times as may be
necessary or appropriate. 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 determined by dividing total net assets (the
value of its assets net of liabilities, including accrued expenses and fees) by
the number of shares outstanding for that class.
The assets of the Fund 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 may be 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 will be fairly valued by the Advisor in
good faith under the supervision of the Board of Trustees. Equity options are
valued at the last sale price; if not available, then the previous day's sales
price is used. If the bid price is higher or the asked price is lower than the
previous last sales price, the higher bid or lower asked prices may be used.
Exchange traded fixed income options are valued at the last sale price unless
there is no sale price, in which event current prices provided by market makers
are used. Over-the-counter fixed income options are valued based upon current
prices provided by market makers. Financial futures are valued at the settlement
price established each day by the board of trade or exchange on which they are
traded.
NET ASSET VALUE AND OFFERING PRICE PER SHARE
<TABLE>
<CAPTION>
<S> <C>
Net asset value per share
($3,259,982/208,338 shares) $15.65
Maximum sales charge, Class A
(4.75% of offering price) 0.78
------
Offering price per share, Class A $16.43
------
------
Class C net asset value and offering price per share
($318,234/20,368 shares) $15.62
------
------
</TABLE>
CALCULATION OF TOTAL RETURN
The Fund may advertise "total return." Total return is calculated
separately for each class. Total return is computed per class 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:
n
P(1 + T) = ERV
where P = a hypothetical initial payment of $1,000; 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.
6
<PAGE>
Total return is historical in nature and is not intended to indicate future
performance. All total return quotations reflect the deduction of the maximum
sales charge ("return with maximum load"), except quotations of "return without
maximum load," which do not deduct sales charge. Thus, in the formula above, for
return without maximum load, P = the entire $1,000 hypothetical initial
investment and does not reflect the deduction of any sales charge; for return
with maximum load, P = a hypothetical initial investment of $1,000 less any
sales charge actually imposed at the beginning of the period for which the
performance is being calculated.
Return for the Funds' shares for the period from inception (January 31,
1997) to September 30, 1997, are as follows:
<TABLE>
<CAPTION>
Class A Shares Class A Shares Class C
without Maximum total return Shares
Sales Load Return with Maximum Total
Sales Load Return
<S> <C> <C> <C>
Since 4.33% -0.62% 4.13%
Inception
</TABLE>
Total return, like net asset value per share, fluctuates in response to
changes in market conditions. Performance for any particular time period should
not be considered an indication of future return.
PURCHASE AND REDEMPTION OF SHARES
Investments in the Fund made by mail, bank wire or electronic funds
transfer, or through the Fund's branch office or brokers participating in the
distribution of Fund shares, are credited to a shareholder's account at the
public offering price which is the net asset value next determined after receipt
by the Fund, plus the sales charge, if applicable, as set forth in the Fund's
Prospectus. Certain Class B and Class C shares may be subject to a contingent
deferred sales charge which is subtracted from the redemption proceeds (see
Prospectus, "Calculation of Contingent Deferred Sales Charges and Waiver of
Sales Charges").
All purchases of Fund shares will be confirmed and credited to shareholder
accounts in full and fractional shares (rounded to the nearest 1/1000th of a
share). 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. A service fee of $10.00, plus any costs
incurred by the Fund, will be charged to investors whose purchase checks are
returned for insufficient funds.
To change redemption instructions already given, shareholders must send a
notice to Calvert Group, with a voided copy of a check for the bank wiring
instructions to be added, to c/o NFDS, P.O. Box 419544, Kansas City, MO 64141-
6544. If a voided check does not accompany the request, then the request must be
signature guaranteed by a commercial bank, trust company, savings association or
member firm of any national securities exchange. Other documentation may be
required from corporations, fiduciaries and institutional investors.
The right of redemption 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 Commission,
or if the Commission has ordered a suspension of trading for the protection of
shareholders.
Redemption proceeds are normally paid in cash. However, 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.
REDUCED SALES CHARGES (CLASS A)
The Fund imposes reduced sales charges for Class A shares 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.
7
<PAGE>
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. Please see "Exhibit A - Reduced
Sales Charges" in the Prospectus. For shareholders who intend to invest at least
$50,000, a Letter of Intent is included in the Appendix to this Statement of
Additional Information.
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 its holdings
or give examples of securities that may have been considered for inclusion in
the Fund, 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, MUTUAL FUND
VALUES MORNINGSTAR RATINGS, MUTUAL FUND FORECASTER, BARRON'S, Nelson's and THE
WALL STREET JOURNAL. The Fund may also cite to any source, whether in print or
on-line, such as Bloomberg, in order to acknowledge origin of information, and
may provide biographical information on, or quote, portfolio managers or Fund
officers. 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, December 31, 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
211 Overlook Drive for the Family Health Council, Inc. in
Pittsburgh, Pennsylvania Pittsburgh, Pennsylvania, a non-profit
15216 corporation which provides family
05/09/48 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, Inc. and Calvert World Values
Fund, Inc.
FRANK H. BLATZ, JR., Esq. Trustee Mr. Blatz is a partner in the law firm
308 East Broad Street of Snevily, Ely, Williams, Gurrieri &
P.O. Box 2007 Blatz. He was formerly a partner with
Westfield, New Jersey Abrams, Blatz, Gran, Hendricks & Reina,
07091 P.A.
10/29/35
FREDERICK T. BORTS, M.D. Trustee Dr. Borts is a radiologist with Kaiser
2040 Nuuanu Avenue #1805 Permanente. Prior to that, he was a
Honolulu, Hawaii, 96817 radiologist at Bethlehem Medical
07/23/49 Imaging in Allentown, Pennsylvania.
8
<PAGE>
*CHARLES E. DIEHL Trustee Mr. Diehl is Vice President and
1658 Quail Hollow Court Treasurer Emeritus of the George
McLean, Virginia 22101 Washington University, and has retired
10/13/22 from University Support Services, Inc.
of Herndon, Virginia. He is also a
Director of Acacia Mutual Life
Insurance Company.
DOUGLAS E. FELDMAN, M.D. Trustee Dr. Feldman practices head and neck
7536 Pepperell Drive reconstructive surgery in the
Bethesda, Maryland 20817 Washington, D.C. metropolitan area.
05/23/48
PETER W. GAVIAN, CFA Trustee Mr. Gavian was a principal of Gavian De
3005 Franklin Road North Vaux Associates, an investment banking
Arlington, Virginia 22201 firm. He continues to be President of
12/08/32 Corporate Finance of Washington, Inc.
JOHN G. GUFFEY, JR. Trustee Mr. Guffey is chairman of the Calvert
7205 Pomander Lane Social Investment Foundation,
Chevy Chase, Maryland organizing director of the Community
20815 Capital Bank in Brooklyn, New York, and
05/15/48 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, Inc.
*BARBARA J. KRUMSIEK, President Ms. Krumsiek serves as President, Chief
Calvert Group, Ltd. and Trustee Executive Officer and Vice Chairman of
4550 Montgomery Ave. Calvert Group, Ltd. and as an officer
Suite 1000N and director of each of its affiliated
Bethesda, Md. 20814 companies. She is director of Calvert-
08/09/52 Sloan Advisers, L.L.C., and a
trustee/director of each of the
investment companies in the Calvert
Group of Funds. Prior to joining
Calvert Group, Ms. Krumsiek served as
Senior Vice President of Alliance
Capital LP's Mutual Fund Division.
M. CHARITO KRUVANT Trustee Ms. Kruvant is President of Creative
5301 Wisconsin Avenue, Associates International, Inc., a firm
N.W. that specializes in human resources
Washington, D.C. 20015 development, information management,
12/08/45 public affairs and private enterprise
development.
ARTHUR J. PUGH Trustee Mr. Pugh serves as a Director of Acacia
4823 Prestwick Drive Federal Savings Bank.
Fairfax, Virginia 22030
09/24/37
*DAVID R. ROCHAT Senior Vice Mr. Rochat is Executive Vice President
Box 93 President of Calvert Asset Management Company,
Chelsea, Vermont 05038 and Trustee Inc., Director and Secretary of Grady,
10/07/37 Berwald and Co., Inc., and Director and
President of Chelsea Securities, Inc.
*D. WAYNE SILBY, Esq. Trustee Mr. Silby is a trustee/director of each
1715 18th Street, N.W. of the investment companies in the
Wahington, Calvert Group of Funds, except for
9
<PAGE>
D.C. 20009 Calvert Variable Series and Calvert New
07/20/48 World Fund, Inc. 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 and Executive
Chairman of GroupServe, Inc., an
Internet Company focused on community
building collaborative tools.
RENO J. MARTINI Senior Vice Mr. Martini is a director and Senior
01/13/50 President 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, Inc.
RONALD M. WOLFSHEIMER, Treasurer Mr. Wolfsheimer is Senior Vice
CPA President and Controller of Calvert
07/24/52 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.
WILLIAM M. TARTIKOFF, Vice Mr. Tartikoff is an officer of each of
Esq. President the investment companies in the Calvert
08/12/47 and Group of Funds, and is Senior Vice
Secretary 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.
DANIEL K. HAYES Vice Mr. Hayes is Vice President of Calvert
09/09/50 President 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.
SUSAN WALKER BENDER, Esq. Assistant Ms. Bender is Associate General Counsel
01/29/59 Secretary 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.
KATHERINE STONER, Esq. Assistant Ms. Stoner is Associate General Counsel
10/21/56 Secretary 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.
LISA CROSSLEY NEWTON, Assistant Ms. Newton is Associate General Counsel
Esq. Secretary of Calvert Group and an officer of each
12/31/61 and of its subsidiaries and Calvert-Sloan
Compliance Advisers, L.L.C. She is also an officer
of
10
<PAGE>
Officer each of the other investment
companies in the Calvert Group of
Funds.
IVY WAFFORD DUKE, Esq. Assistant Ms. Duke is Assistant Counsel of
09/07/68 Secretary 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. Prior to working at Calvert, Ms.
Duke was an Associate in the Investment
Management Group of the Business and
Finance Department at Drinker Biddle &
Reath.
The address of Trustees and Officers, unless otherwise noted, is 4550
Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. Trustees and Officers
as a group own less than 1% of the Portfolio'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 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 is among the directors.
The Audit Committee of the Board is composed of Messrs. Baird, Blatz,
Feldman, Guffey and Pugh, and Ms. Kruvant. The Board's Investment Policy
Committee is composed of Messrs. Borts, Diehl, Gavian, Rochat and Silby.
Messrs. Baird, Guffey and Silby serve on the High Social Impact Investments
Committee which assists the Fund in identifying, evaluating and selecting
investments in securities that offer a rate of return below the then-prevailing
market rate and that present attractive opportunities for furthering the Fund's
social criteria.
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.
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.
<TABLE>
<CAPTION>
Trustee Compensation Table
Fiscal Year 1997 Aggregate Compensation Pension or Retirement Total Compensation from
(unaudited numbers) from Registrant for Service Benefits Accrued as part Registrant and Fund
as Trustee of Registrant Expenses* Complex paid to Trustee**
Name of Trustee
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
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
</TABLE>
11
<PAGE>
* 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 AND SUBADVISOR
The Fund's Investment Advisor is Calvert Asset Management Company, Inc.,
4550 Montgomery Avenue, 1000N, 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 Fund and the Advisor was entered into as
of January 30, 1997, and will remain in effect indefinitely, provided
continuance is approved at least annually by the 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. The Fund's Subadvisor is Awad & Associates, ("Subadvisor" or
"AWAD"). Pursuant to an Investment Subadvisory Agreement with the Advisor, the
Subadvisor determines investment selections for the Fund.
The Fund has received an exemptive order to permit the Fund and the Advisor
to enter into and materially amend the Investment Subadvisory Agreement without
shareholder approval. Within 90 days of the hiring of any Subadvisor or the
implementation of any proposed material changed in the Investment Subadvisory
Agreement, the Fund will furnish its shareholders information about the new
Subadvisor or Investment Subadvisory Agreement that would be included in a proxy
statement. Such information will include any change in such disclosure caused by
the addition of a new Subadvisor or any proposed material change in the
Investment Subadvisory Agreement of the Fund. The Fund will meet this condition
by providing shareholders, within 90 days of the hiring of the Subadvisor or
implementation of any material change to the terms of an Investment Subadvisory
Agreement, with an information statement to this effect.
The Advisor provides the Fund with investment supervision and management,
administrative services, office space, furnishes executive and other personnel
to the Fund, and may pay 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 administrative
and operating expenses, including: custodial, registration, dividend disbursing
and transfer agency fees; federal and state securities registration fees;
salaries, fees and expenses of Trustees, executive officers and employees of the
Fund, who are not "affiliated persons" of the Advisor or the Subadvisor within
the meaning of the Investment Company Act of 1940; insurance premiums; trade
association dues; legal and audit fees; interest, taxes and other business fees;
expenses of printing and mailing reports, notices, prospectuses, and proxy
material to shareholders; annual shareholders' meeting expenses; and brokerage
commissions and other costs associated with the purchase and sale of portfolio
securities. The Advisor has agreed to reimburse the Fund for all expenses
(excluding brokerage, taxes, interest, and all or a portion of distribution and
certain other expenses, to the extent allowed by federal law or regulation).
Under the contract, the Advisor provides investment advice to the Fund and
oversees its 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 0.90% of the Fund's average daily net assets.
For fiscal year 1997, the Fund paid advisory fees of $14,100. The Advisor
may voluntarily defer its fees or assume expenses of the Fund. For fiscal year
1997, the Advisor reimbursed the Fund $65,410 for fees and expenses. The Advisor
may recapture from (charge to) the Fund (through December 31, 1999) for such
expenses incurred, provided that such recapture would not cause the Fund's
aggregate expenses to exceed the annual expense limit. The Advisor may
voluntarily agree to further defer its fees or assume Fund expenses from January
1, 1997 through December 31, 1998 ("Additional Deferral/Assumption Period"). If
so, the Advisor may recapture from (charge to) the Fund for any such expenses
incurred during the Additional Deferral/Assumption Period, provided that such
recapture would not cause the Fund's aggregate expenses to exceed the annual
expense limit, and that such recapture shall be made to the Advisor only from
the two-year period from January 1, 1999 through December 31, 2000. Each year's
current advisory fees (incurred in that year) will be paid in full before any
recapture for a prior year is applied. Recapture then will be applied beginning
with the most recent year first.
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<PAGE>
Calvert Administrative Services Company ("CASC"), an affiliate of the
Advisor, has been retained by the Fund to provide certain administrative
services necessary to the conduct of its affairs, including the preparation of
regulatory filings and shareholder reports, the daily determination of its net
asset value per share and dividends, and the maintenance of its portfolio and
general accounting records. For providing such services, CASC receives an annual
fee from the Fund of 0.10% of the Fund's average daily net assets.
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
pursuant to the Distribution Plan (see below). For Class A Shares, CDI also
receives the portion of the sales charge in excess of the dealer reallowance.
For Class B and Class C Shares, CDI receives any CDSC paid.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Fund
has adopted Distribution Plans (the "Distribution Plans") which permits the Fund
to pay certain expenses associated with the distribution of its shares. Such
expenses may not exceed, on an annual basis, 0.25% of the Fund's Class A average
daily net assets, and 1.00% of the Fund's Class B and Class C average daily net
assets, respectively. For fiscal year 1997, Class A Distribution Plan expenses
totaled $3,390. Of the Class A Distribution Plan expenses paid in fiscal year
1997, almost entirely all of the expenses were used for broker/dealer
compensation. During the same period, CDI received net sales charges of $11,744.
For fiscal year 1997, Class C Distribution Plan expenses totaled $2,104. Of the
Class Distribution Plan expenses paid in fiscal year 1997, almost entirely all
of the expenses were used for broker/dealer compensation. No Class B
Distribution Plan expenses were paid in fiscal year 1997 since there were no
Class B Shares outstanding.
The Fund's Distribution Plans were 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 Distribution Plans or in any
agreements related to the Distribution 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 Distribution
Plans, the Trustees considered various factors including the amount of the
distribution expenses. The Trustees determined that there is a reasonable
likelihood that the Distribution Plans will benefit the Fund and its
shareholders.
The Distribution Plans may be terminated by vote of a majority of the non-
interested Trustees who have no direct or indirect financial interest in the
Distribution Plans, or by vote of a majority of the outstanding shares of the
Fund. Any change in the Distribution Plans that would materially increase the
distribution cost to the Fund requires approval of the shareholders of the
affected class; otherwise, the Distribution Plans may be amended by the
Trustees, including a majority of the non-interested Trustees as described
above. The Distribution Plans will continue in effect for successive one-year
terms provided that such continuance is specifically approved by (i) the vote of
a majority of the Trustees who are not parties to the Distribution Plans or
interested persons of any such party and who have no direct or indirect
financial interest in the Distribution Plans, and (ii) the vote of a majority of
the entire Board of Trustees.
Apart from the Distribution Plans, the Advisor and CDI, at their own
expense, may incur costs and pay expenses associated with the distribution of
shares of the Fund.
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 my
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 AGENT
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.
13
<PAGE>
Calvert Shareholder Services, Inc. ("CSSI"), 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
fee based on the number of shareholder accounts and transactions.
FUND TRANSACTIONS
Fund transactions are undertaken on the basis of their desirability from an
investment standpoint. Investment decisions and the choice of brokers and
dealers are made by the Fund's Advisor and Subadvisor under the direction and
supervision of the Fund's Board of Trustees.
Broker-dealers who execute portfolio transactions on behalf of the Fund are
selected on the basis of their professional capability and the value and quality
of their services. The Fund may pay brokerage commissions to broker-dealers who
provide the Fund with statistical, research, or other information and services.
Notwithstanding the quality of execution and other services provided, the Fund
may pay commissions that are higher than those available elsewhere. Any such
payments are subject to the criteria of Section 28(e) of the Securities Exchange
Act of 1934. Although any statistical research or other information and services
provided by such broker-dealers may be useful to the Advisor and the Subadvisor,
the dollar value of such information and services is generally indeterminable,
and its availability or receipt does not serve materially to reduce the
Advisor's or Subadvisor's normal research activities or expenses. During fiscal
year 1997, $3,401 in aggregate brokerage commissions were paid to broker-
dealers.
The Advisor and Subadvisor may also execute portfolio transactions with or
through broker-dealers who have sold shares of the Fund. However, such sales
will not be a qualifying or disqualifying factor in a broker-dealer's selection
nor will the selection of any broker-dealer be based on the volume of Fund
shares sold.
Depending upon market conditions, portfolio turnover, generally defined as
the lesser of annual sales or purchases of portfolio securities divided by the
average monthly value of the Fund's portfolio securities (excluding from both
the numerator and the denominator all securities whose maturities or expiration
dates as of the date of acquisition are one year or less), expressed as a
percentage. For fiscal year 1997, it was 196%.
INDEPENDENT ACCOUNTANT AND CUSTODIANS
Coopers & Lybrand, L.L.P. has been selected by the Board of Trustees to
serve as independent accountant for fiscal year 1998. State Street Bank & Trust
Company, N.A., 225 Franklin Street, Boston, MA 02110, 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 was organized as a Massachusetts business trust on March
15, 1982. The series of the Fund include Calvert Income Fund and Calvert New
Vision Small Cap Fund.
Each share represents an equal proportionate interest with each other share
and is entitled to such dividends and distributions out of the income belonging
to such class as declared by the Board. The Fund offers three separate classes
of shares: Class A, Class B and Class C. Each class represents interests in the
same portfolio of investments but, as further described in the prospectus, each
class is subject to differing sales charges and expenses, which differences will
result in differing net asset values and distributions. Upon any liquidation of
the Fund, shareholders of each class are entitled to share pro rata in the net
assets belonging to that series available for distribution.
The Fund will send its 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.
14
<PAGE>
The Prospectus and this Statement of Additional Information do not contain
all the information in the Fund's registration statement. The registration
statement is on file with the Securities and Exchange Commission and is
available to the public.
FINANCIAL STATEMENTS
The audited financial statements in the Fund's Annual Report to
Shareholders dated March 31, 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 Fund.
APPENDIX
CORPORATE BOND AND COMMERCIAL PAPER RATINGS
CORPORATE BONDS:
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:
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
15
<PAGE>
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.
GLOSSARY OF PERMITTED INVESTMENTS
The following is a description of permitted investments and other applicable
terms for the Fund:
AMERICAN DEPOSITARY RECEIPTS ("ADRs"): ADRs are securities typically issued by a
U.S. financial institution that evidence ownership interest in a security or a
pool of securities issued by a foreign issuer and deposited with the depository.
ADRs may be available for investment through "sponsored" or "unsponsored"
facilities. A sponsored facility is established jointly by the issuer of the
security underlying the receipt and a depository, whereas an unsponsored
facility may be established by a depository without participation by the issuer
of the receipt's underlying security.
BANKER'S ACCEPTANCE: A bill of exchange or time draft drawn on and accepted by a
commercial bank. It is used by corporations to finance the shipment and storage
of goods and to furnish dollar exchange. Maturities are generally six months or
less.
CERTIFICATE OF DEPOSIT: A negotiable interest bearing instrument with a specific
maturity. Certificates of deposit are issued by banks and savings and loan
institutions in exchange for the deposit of funds and normally can be traded in
the secondary market prior to maturity. Certificates of deposit generally carry
penalties for early withdrawal.
COMMERCIAL PAPER: The term used to designate unsecured short-term promissory
notes issued by corporations and other entities. Maturities on these issues
typically vary from a few days to nine months.
CONVERTIBLE SECURITIES: Securities such as rights, bonds, notes and preferred
stocks which are convertible into or exchangeable for common stocks. Convertible
securities have characteristics similar to both fixed income and equity
securities. Because of the conversion feature, the market value of convertible
securities tends to move together with the market value of the underlying common
stock. As a result, the Portfolio's selection of convertible securities is
based, to a great extent, on the potential for capital appreciation that may
exist in the underlying stock. The value of convertible securities is also
affected by prevailing interest rates, the credit quality of the issuer, and any
call provisions.
FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS: The Fund may enter into
contracts for the purchase or sale of securities. A purchase of a futures
contract means the acquisition of a contractual right to obtain delivery to the
Fund of securities called for by the contract at a specified price during a
specified future month. When a futures contract is sold, the Fund incurs a
contractual obligation to deliver the securities underlying the contract at a
specified price on a specified date during a specified future month. The Fund
may sell stock index futures contracts in anticipation of, or during, a market
decline to attempt to offset the decrease in market value of its common stocks
that might otherwise result; and it may purchase such contracts in order to
offset increases in the cost of common stocks that it intends to purchase.
The Fund may also purchase and write options to buy or sell futures
contracts. The Fund may write options on futures only on a covered basis.
Options on futures are similar to options on securities except that options on
futures give the purchaser the right, in return for the premium paid, to assume
a position in a futures contract, rather than actually to purchase or sell the
futures contract, at a specified exercise price at any time during the period of
the option. When the Fund enters into a futures transaction it must deliver to
the futures commission merchant selected by the Fund, an amount referred to as
"initial margin." This amount is maintained by the futures commission merchant
in a segregated account at the custodian bank. Thereafter, a "variation margin"
may be paid by the Fund to, or drawn by the Fund from, such account in
accordance with controls set for such accounts, depending upon changes in the
price of the underlying securities to the futures contract.
OPTIONS: The Fund may invest in put and call options for various stocks and
stock indices that are traded on national securities exchanges, from time to
time as the Subadvisor deems to be appropriate. Options will be used for hedging
purposes and will not be engaged in for speculative purposes.
A put option gives the purchaser of the option the right to sell, and the
writer the obligation to buy, the underlying security at any time during the
option period. A call option gives the purchaser of the option the right to buy,
and the writer of the option the obligation to sell, the underlying security at
any time during the option period. The premium paid to the writer is the
consideration for undertaking the obligations under the option contract.
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<PAGE>
Although the Fund will engage in option transactions only as hedging
transactions and not for speculative purposes, there are risks associated with
such investment including the following: (i) the success of a hedging strategy
may depend on the ability of the Subadvisor to predict movements in the prices
of the individual securities, fluctuations in markets and movements in interest
rates; (ii) there may be an imperfect correlation between the changes in market
value of the stocks held by the Fund and the prices of options; (iii) there may
not be liquid secondary market for options; and (iv) while the Fund will receive
a premium when it writes covered call options, it may not participate fully in a
rise in the market value of the underlying security. When writing options (other
than covered call options), the Fund must establish and maintain a segregated
account with the Fund's Custodian containing cash or liquid, high grade debt
securities in an amount at least equal to the market value of the option.
RABBI TRUST: Nonqualified deferred compensation plan which is an irrevocable
trust established by an employer to hold assets to provide deferred compensation
for such employer's employees.
REPURCHASE AGREEMENTS: Agreements by which a person obtains a security and
simultaneously commits to return it to the seller at any agreed upon price
(including principal and interest) on an agreed upon date within a number of
days from the date of purchase. The Fund's Custodian or its agents will hold the
security as collateral for the repurchase agreement. The Fund bears a risk of
loss in the event the other party defaults on its obligations and the Fund is
delayed or prevented from its right to dispose of the collateral securities.
TIME DEPOSIT: A non-negotiable receipt issued by a bank in exchange for the
deposit of funds. Like a certificate of deposit, it earns a specified rate of
interest over a definite period of time; however, it cannot be traded in the
secondary market. Time deposits with a withdrawal penalty are considered to be
illiquid securities.
U.S. GOVERNMENT AGENCY OBLIGATIONS: Certain Federal agencies such as the
Government National Mortgage Association ("GNMA") have been established as
instrumentalities of the United States Government to supervise and finance
certain types of activities. Issues of these agencies, while not direct
obligations of the United States Government, are either backed by the full faith
and credit of the United States (i.e., GNMA securities) or supported by the
issuing agencies' right to borrow from the Treasury. The issues of other
agencies are supported by the credit of the instrumentality (i.e., Federal
National Mortgage Association securities).
U.S. GOVERNMENT SECURITIES: Bills, notes and bonds issued by the U.S. Government
and backed by the full faith and credit of the United States.
U.S. TREASURY OBLIGATIONS: Bills, notes and bonds issued by the U.S. Treasury,
and separately traded interest and principal component parts of such obligations
that are transferable through the Federal book-entry system known as Separately
Traded Registered Interest and Principal Securities ("STRIPS").
WARRANTS: Instruments giving holders the right, but not the obligations, to buy
shares of a company at a given price during a specified period.
17
<PAGE>
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(not available for mid-load funds) __ $100,000 __ $250,000
__ $500,000 __ $1,000,000 __ $2,500,000
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. 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 escorted
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
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<PAGE>
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 CDI 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 Name of Investor(s)
By
- -------------------------------- ----------------------------------------
Authorized Signer Address
- -------------------------------- ----------------------------------------
Date SIGNATURE OF INVESTOR(S)
- -------------------------------- ----------------------------------------
Date SIGNATURE OF INVESTOR(S)
19
<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 New Vision
Small Cap Fund are incorporated by reference to Registrant's
Semi-Annual Report to Shareholders dated September 30, 1997,
and filed December 16, 1997. That report is being audited by Coopers
& Lybrand and will be filed as an Annual Report due to the recent
change of fiscal year-end from 3/31 to 9/30.
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).
6. Underwriting and Dealer Agreement, filed herewith.
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, filed herewith.
10. Opinion and Consent of Counsel as to Legality of Shares Being
Registered.
11. Consent of Independent Accountants.
<PAGE>
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, filed herewith. 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, filed herewith.
Exhibits 3, 12 and 13 are omitted because they are inapplicable.
Item 25. Persons Controlled By or Under Common Control With Registrant
Item 26. Number of Holders of Securities
As of February 28, 1998, there were 2,715 holders of record of
Registrant's Class A shares of beneficial interest for Calvert Income Fund.
As of February 28, 1998, there were 11,858 holders of record of
Registrant's Class A shares of beneficial interest for Calvert New Vision
Small Cap Fund.
As of February 28, 1998, there were 1,477 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
<PAGE>
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
----------------
<PAGE>
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
<PAGE>
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
<PAGE>
---------------
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
<PAGE>
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
<PAGE>
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
<PAGE>
---------------
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
----------------
<PAGE>
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
<PAGE>
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
<PAGE>
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
<PAGE>
---------------
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
<PAGE>
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
------------------
Matthew D. Gelfand Calvert Asset Management Officer
Company, Inc.
Investment Advisor
4550 Montgomery Avenue
Bethesda, Maryland 20814
------------------
Strategic Investment Management Officer
Investment Advisor
1001 19th Street North
Arlington, Virginia 20009
------------------
Item 29. Principal Underwriters
(a) Registrant's principal underwriter also underwrites
shares of First Variable Rate Fund for Government Income, Calvert
<PAGE>
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
Craig Cloyed Senior Vice President None
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
<PAGE>
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 27th day of March, 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 3/27/98
Barbara J. Krumsiek Trustee (Principal Executive
Officer)
__________**____________ Principal Accounting 3/27/98
Ronald M. Wolfsheimer Officer
<PAGE>
__________**____________ Trustee 3/27/98
Richard L. Baird, Jr.
__________**____________ Trustee 3/27/98
Frank H. Blatz, Jr., Esq.
__________**____________ Trustee 3/27/98
Frederick T. Borts, M.D.
__________**____________ Trustee 3/27/98
Charles E. Diehl
__________**____________ Trustee 3/27/98
Douglas E. Feldman
__________**____________ Trustee 3/27/98
Peter W. Gavian
__________**____________ Trustee 3/27/98
John G. Guffey, Jr.
__________**____________ Trustee 3/27/98
M. Charito Kruvant
__________**____________ Trustee 3/27/98
Arthur J. Pugh
__________**____________ Trustee 3/27/98
David R. Rochat
__________**____________ Trustee 3/27/98
D. Wayne Silby
**By Ivy Wafford Duke as Attorney-in-fact, pursuant to Power of Attorney Forms
on file.
<PAGE>
DISTRIBUTION AGREEMENT
This DISTRIBUTION AGREEMENT, dated as of February 25, 1998 by and between
EACH CALVERT FUND LISTED IN THE SCHEDULE OF FUNDS ATTACHED HERETO AS SCHEDULE I
(each a "Fund" and together the "Funds"), as such schedule may, from time to
time be amended, and CALVERT DISTRIBUTORS, INC., a Delaware corporation (the
"Distributor").
WHEREAS, each Fund is registered as an open-end investment company under
the Investment Company Act of 1940 (the "1940 Act") and has registered its
shares, including shares of its series portfolios (the "Series"), for sale to
the public under the Securities Act of 1933 (the "1933 Act") and various state
securities laws;
WHEREAS, each Fund wishes to retain the Distributor as the principal
underwriter in connection with the offer and sale of shares of the Series (the
"Shares") and to furnish certain other services to the Series as specified in
this Agreement;
WHEREAS, this contract has been approved by the Trustees/Directors of each
Fund in anticipation of the Distributor's transfer of its rights to receive the
Class B Distribution Fees ( as defined in the Distribution Plan for Class B and
C Shares (the "Distribution Plan")) and/or Class B contingent deferred sales
charges to a financing party in order to raise funds to cover distribution
expenditures; and
WHEREAS, the Distributor is willing to act as principal underwriter and to
furnish such services on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed as follows:
1. Each Fund hereby appoints the Distributor as principal underwriter in
connection with the offer and sale of its Shares. The Distributor shall, as
agent for each Fund, subject to applicable federal and state law and the
Declaration of Trust or Articles of Incorporation, and By-laws of the applicable
Fund and in accordance with the representations in the applicable Fund's
Registration Statement and Prospectus, as such documents may be amended from
time to time: (a) promote the Series; (b) enter into appropriate dealer
agreements with other registered broker-dealers to further distribution of the
Shares; (c) solicit orders for the purchase of the Shares subject to such terms
and conditions as the applicable Fund may specify; (d) transmit promptly orders
and payments for the purchase of Shares and orders for redemption of Shares to
the applicable Fund's transfer agent; and (e) provide services agreed upon by
the applicable Fund to Series shareholders; provided, however, that the
Distributor may sell no Shares pursuant to this Agreement until the Distributor
is notified that a Fund's Registration Statement under the 1933 Act, authorizing
the sale of such Shares through the Distributor, has become effective. The
Distributor shall comply with all applicable federal and state laws and offer
the Shares on an agency or "best efforts" basis under which a Fund shall only
issue such Shares as are actually sold.
2. The public offering price of the Shares shall be the net asset value
("NAV") per share (as determined by the applicable Fund) of the outstanding
Shares of the Series, plus the applicable sales charge, if any, as set forth in
the Fund's then current Prospectus. Each Fund shall furnish the Distributor with
a statement of each computation of NAV and of the details entering into such
computation.
3. COMPENSATION.
a. DISTRIBUTION FEE.
i. CLASS A. In consideration of the Distributor's services as distributor
for the Class A Shares of a Fund, each Fund may pay to the Distributor the
Distribution Fee as set forth in Schedule II to this Agreement that is payable
pursuant to the Fund's Distribution Plan.
-1-
<PAGE>
ii. CLASS B. In consideration of the Distributor's services as distributor
for the Class B Shares of a Fund, each Fund shall pay to the Distributor (or its
designee or transferee) the Distributor's Allocable Portion of the Distribution
Fee; (as set forth in Schedule II to this Agreement) that is payable pursuant to
the Fund's Distribution Plan in respect of the Class B Shares of a Fund. For
purposes of this Agreement, the Distributor's "Allocable Portion" of the
Distribution Fee shall be 100% of such Distribution Fee unless or until the Fund
uses a principal underwriter other than the Distributor and thereafter the
Allocable Portion shall be the portion of the Distribution Fee attributable to
(i) Class B Shares of a Fund sold by the Distributor ("Commission Shares"), (ii)
Class B Shares of the Fund issued in connection with the exchange of Commission
Shares of another Fund, and (iii) Class B Shares of the Fund issued in
connection with the reinvestment of dividends and capital gains.
The Distributor's Allocable Portion of the Distribution Fee and the
contingent deferred sales charges arising in respect of Class B Shares taken
into account in computing the Distributor's Allocable Portion shall be limited
under Rule 2830 of the Conduct Rules or other applicable regulations of the NASD
as if the Class B Shares taken into account in computing the Distributor's
Allocable Portion themselves constituted a separate class of shares of a Fund.
The services rendered by the Distributor for which the Distributor is
entitled to receive the Distributor's Allocable Portion of the Distribution Fee
shall be deemed to have been completed at the time of the initial purchase of
the Commission Shares (whether of the Fund or another Fund in the Calvert Group
of Funds) taken into account in computing the Distributor's Allocable Portion.
Notwithstanding anything to the contrary in this Agreement, the Distributor
shall be paid its Allocable Portion of the Distribution Fee notwithstanding the
Distributor's termination as principal underwriter of the Class B Shares of a
Fund, or any termination of this Agreement other than in connection with a
Complete Termination (as defined in the Distribution Plan) of the Class B
Distribution Plan as in effect on the date of this Agreement. Except as provided
in the preceding sentence, a Fund's obligation to pay the Distribution Fee to
the Distributor shall be absolute and unconditional and shall not be subject to
any dispute, offset, counterclaim or defense whatsoever, (it being understood
that nothing in this sentence shall be deemed a waiver by a Fund of its right
separately to pursue any claims it may have against the Distributor and to
enforce such claims against any assets (other than its rights to be paid its
Allocable Portion of the Distribution Fee and to be paid the contingent deferred
sales charges) of the Distributor.
iii. CLASS C. In consideration of the Distributor's services as distributor
for the Class C Shares of a Fund, each Fund shall pay to the Distributor the
Distribution Fee as set forth in Schedule II to this Agreement that is payable
pursuant to the Fund's Distribution Plan.
b. SERVICE FEE. As additional compensation, for Class A, Class B and
Class C Shares of each Series, applicable Funds shall pay the Distributor a
service fee (as that term is defined by the National Association of Securities
Dealers, Inc. ("NASD")) as set forth in Schedule III to this Agreement that is
payable pursuant to the Fund's Distribution Plan.
c. FRONT-END SALES CHARGES. As additional compensation for the services
performed and the expenses assumed by the Distributor under this Agreement, the
Distributor may, in conformity with the terms and conditions set forth in the
then current Prospectus of each Fund, impose and retain for its own account the
amount of the front-end sales charge, if any, and may reallow a portion of any
front-end sales charge to other broker-dealers, all in accordance with NASD
rules.
d. CONTINGENT DEFERRED SALES CHARGE. Each Fund will pay to the
Distributor (or its designee or transferee) in addition to the fees set forth in
Section 3 hereof any contingent deferred sales charge imposed on redemptions of
that Fund's Class B and Class C Shares upon the terms and conditions set forth
in the then current Prospectus of that Fund. Notwithstanding anything to the
contrary in this Agreement, the Distributor shall be paid such contingent
deferred sales charges in respect of Class B Shares taken into account in
computing the Distributor's Allocable Portion of the Distribution Fee
notwithstanding the Distributor's termination as principal underwriter of the
Class B shares of a Fund or any termination of this Agreement other than in
connection with a Complete Termination of the Class B Distribution Plan as in
effect on the date of this Agreement. Except as provided in the preceding
sentence, a Fund's obligation to remit such contingent deferred sales charges to
the Distributor shall not
-2-
<PAGE>
be subject to any dispute, offset, counterclaim or defense whatsoever, it being
understood that nothing in this sentence shall be deemed a waiver by a Fund of
its right separately to pursue any claims it may have against the Distributor
and to enforce such claims against any assets (other than the Distributor's
right to be paid its Allocable Portion of the Distribution Fee and to be paid
the contingent deferred sales charges) of the Distributor. No Fund will waive
any contingent deferred sales charge except under the circumstances set forth in
the Fund's current Prospectus without the consent of the Distributor (or, if
rights to payment have been transferred, the transferee), which consent shall
not be unreasonably withheld.
4. PAYMENTS TO DISTRIBUTOR'S TRANSFEREES. The Distributor may transfer
the right to payments hereunder (but not its obligations hereunder) in order to
raise funds to cover distribution expenditures, and any such transfer shall be
effective upon written notice from the Distributor to the Fund. In connection
with the foregoing, the Fund is authorized to pay all or a part of the
Distribution Fee and/or contingent deferred sales charges in respect of Class B
Shares directly to such transferee as directed by the Distributor.
5. CHANGES IN COMPUTATION OF FEE, ETC. As long as the Class B
Distribution Plan is in effect, a Fund shall not change the manner in which the
Class B Distribution Fee is computed (except as may be required by a change in
applicable law or a change in accounting policy adopted by the Investment
Companies Committee of the AICPA and approved by FASB that results in a
determination by a Fund's independent accountants that any of the sales charges
in respect of such Fund, which are not contingent deferred sales charges and
which are not yet due and payable, must be accounted for by such Fund as a
liability in accordance with GAAP).
6. As used in this Agreement, the term "Registration Statement" shall
mean the registration statement most recently filed by a Fund with the
Securities and Exchange Commission and effective under the 1933 Act, as such
Registration Statement is amended by any amendments thereto at the time in
effect, and the term "Prospectus" shall mean the form of prospectus filed by a
Fund as part of the Registration Statement.
7. The Distributor shall print and distribute to prospective investors
Prospectuses, and may print and distribute such other sales literature, reports,
forms, and advertisements in connection with the sale of the Shares as comply
with the applicable provisions of federal and state law. In connection with such
sales and offers of sale, the Distributor shall give only such information and
make only such statements or representations, and require broker-dealers with
whom it enters into dealer agreements to give only such information and make
only such statements or representations, as are contained in the Prospectus or
in information furnished in writing to the Distributor by a Fund. The Funds
shall not be responsible in any way for any other information, statements or
representations given or made by the Distributor, other broker-dealers, or the
representatives or agents of the Distributor or such broker-dealers. Except as
specifically permitted under the Distribution Plan under Rule 12b-1 under the
1940 Act, as provided in paragraph 3 of this Agreement, the Funds shall bear
none of the expenses of the Distributor in connection with its offer and sale of
the Shares.
8. Each Fund agrees at its own expense to register the Shares with the
Securities and Exchange Commission, state and other regulatory bodies, and to
prepare and file from time to time such Prospectuses, amendments, reports and
other documents as may be necessary to maintain the Registration Statement. Each
Fund shall bear all expenses related to preparing and typesetting its
Prospectus(es) and other materials required by law and such other expenses,
including printing and mailing expenses related to the Fund's communications
with persons who are shareholders of such Fund.
9. Each Fund agrees to indemnify, defend and hold the Distributor, its
several officers and directors, and any person who controls the Distributor
within the meaning of Section 15 of the 1933 Act, free and harmless from and
against any and all claims, demands, liabilities and expenses (including the
cost of investigating or defending such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which the Distributor, its
officers or directors, or any such controlling person may incur, under the 1933
Act or under common law or otherwise, arising out of or based upon any alleged
untrue statement of a material fact contained in its Registration Statement or
Prospectus or arising out of or based upon any alleged omission to state a
material fact required to be stated in either thereof or necessary to make the
statements in either thereof not misleading, provided that in no event shall
anything contained in this Agreement be construed so as to protect the
Distributor against any
-3-
<PAGE>
liability to a Fund or its shareholders to which the Distributor would
otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence, in the performance of its duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement.
10. The Distributor agrees to indemnify, defend and hold each Fund, their
several officers and directors, and any person who controls a Fund within the
meaning of Section 15 of the 1933 Act, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which a Fund, its officers or directors,
or any such controlling person may incur, under the 1933 Act or under common law
or otherwise, arising out of or based upon any alleged untrue statement or a
material fact contained in information furnished in writing by the Distributor
to the Funds for use in the Registration Statement or Prospectus(es) or arising
out of or based upon any alleged omission to state a material fact in connection
with such information required to be stated in the Registration Statement or
Prospectus(es) or necessary to make such information not misleading.
11. Each Fund reserves the right at any time to withdraw all offerings of
the Shares by written notice to the Distributor at its principal office.
12. The Distributor is an independent contractor and shall be agent for a
Fund only in respect to the offer, sale and redemption of that Fund's Shares.
13. The services of the Distributor to a Fund under this Agreement are not
to be deemed exclusive, and the Distributor shall be free to render similar
services or other services to others so long as its services hereunder are not
impaired thereby.
14. The Distributor acknowledges that it has received notice of and
accepts the limitations upon the liability of any Fund organized as a business
trust set forth in such Fund's Declaration of Trust. The Distributor agrees that
the obligations of such Funds hereunder in any case shall be limited to such
Funds and to their assets and that the Distributor shall not seek satisfaction
of any such obligation from the shareholders of such a Fund nor from any
Trustee, officer, employee or agent of such Fund.
15. The Funds shall not use the name of the Distributor in any Prospectus,
sales literature or other material relating to the Funds in any manner not
approved prior thereto by the Distributor; provided, however, that the
Distributor shall approve all uses of its name which merely refer in accurate
terms to its appointment hereunder or which are required by the Securities and
Exchange Commission or a State Securities Commission; and, provided further,
that in no event shall such approval be unreasonably withheld. The Distributor
shall not use the name of any Fund in any material relating to the Distributor
in any manner not approved prior thereto by the Fund; provided, however that the
Funds shall approve all uses of their names which merely refer in accurate terms
to the appointment of the Distributor hereunder or which are required by the
Securities and Exchange Commission or a State Securities Commission; and,
provided further, that in no event shall such approval be unreasonably withheld.
16. The Distributor shall prepare written reports for the Board of
Trustees/Directors of each Fund on a quarterly basis showing information
concerning services provided and expenses incurred which are related to this
Agreement and such other information as from time to time shall be reasonably
requested by a Fund's Board of Trustees/Directors.
17. As used in this Agreement, the terms "assignment," "interested
person," and "majority of the outstanding voting securities" shall have the
meaning given to them by Section 2(a) of the 1940 Act, subject to such
exemptions as may be granted by the Securities and Exchange Commission by any
rule, regulation or order; provided, however that, in order to obtain financing,
the Distributor may assign to a lending institution the payments due to the
Distributor under this Agreement without it constituting an assignment of the
Agreement.
18. Subject to the provisions of sections 19 and 20 below, this Agreement
will remain in effect for two years from the date of is execution and from year
to year thereafter, provided that the Distributor does not notify a Fund in
writing at least sixty (60) days prior to the expiration date in any year that
it does not wish
-4-
<PAGE>
continuance of the Agreement as to such Fund for an additional year.
19. TERMINATION. As to any particular Fund (or Series thereof), this
Agreement shall automatically terminate in the event of its assignment and may
be terminated at any time without the payment of any penalty by a Fund or by the
Distributor on sixty (60) days' written notice to the other party. A Fund may
effect such termination by a vote of (i) a majority of the Board of
Trustees/Directors of the Fund, (ii) a majority of the Trustees/Directors who
are not interested persons of the Fund, who are not parties to this Agreement or
interested persons of such parties, and who have no direct or indirect financial
interest in the operation of the Distribution Plan, in this Agreement or in any
agreement related to such Fund's Distribution Plan (the "Rule 12b-1
Trustees/Directors"), or (iii) a majority of the outstanding voting securities
of the relevant Series.
20. This Agreement shall be submitted for renewal to the Board of
Trustees/Directors of each Fund at least annually and shall continue in effect
only so long as specifically approved at least annually (i) by a majority vote
of the Fund's Board of Trustees/Directors, and (ii) by the vote of the majority
of the Rule 12b-1 Trustees/Directors of the Fund, cast in person at a meeting
called for the purpose of voting on such approval.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written by their officers thereunto duly
authorized.
Attest: EACH FUND LISTED IN THE
ATTACHED SCHEDULE I
By: /s/ Edwidge Saint-Felix By: /s/ William M. Tartikoff
Vice President
Attest: CALVERT DISTRIBUTORS, INC.
By: /s/ Edwidge Saint-Felix By: /s/ Ronald M. Wolfsheimer
Senior Vice President
-5-
<PAGE>
SCHEDULE I
The Calvert Fund
Calvert Tax-Free Reserves
Calvert Municipal Fund
Calvert Social Investment Fund
Calvert World Values Fund
Calvert New World Fund
First Variable Rate Fund
-6-
<PAGE>
SCHEDULE II
Fees are expressed as a percentage of average annual daily net assets, and are
payable monthly.
DISTRIBUTION FEE
<TABLE>
<CAPTION>
Class A* Class B Class C Class I
<S> <C> <C> <C> <C>
The Calvert Fund
New Vision Small Cap Fund N/A 0.75 0.75 N/A
Calvert Income Fund 0.25 0.75 0.75 N/A
Calvert Tax-Free Reserves
Money Market Portfolio N/A N/A N/A N/A
Limited-Term Portfolio N/A N/A N/A N/A
Long-Term Portfolio 0.10 0.75 0.75 N/A
California Money Market Port. N/A N/A N/A N/A
Vermont Municipal N/A 0.75 0.75 N/A
Calvert Municipal Fund
National Intermediate Fund N/A 0.75 N/A N/A
California Intermediate Fund N/A 0.75 N/A N/A
Maryland Intermediate Fund N/A 0.75 N/A N/A
Virginia Intermediate Fund N/A 0.75 N/A N/A
Calvert Social Investment Fund
Managed Growth Portfolio 0.10 0.75 0.75 N/A
Equity Portfolio 0.10 0.75 0.75 N/A
Bond Portfolio 0.10 0.75 0.75 N/A
Managed Index Portfolio N/A 0.75 0.75 N/A
Money Market Portfolio N/A N/A N/A N/A
Calvert World Values Fund
Capital Accumulation Fund 0.10 0.75 0.75 N/A
International Equity Fund 0.10 0.75 0.75 N/A
Calvert New World Fund
Calvert New Africa Fund N/A 0.75 0.75 N/A
First Variable Rate Fund
Calvert First Gov't Money Mkt N/A 0.75 N/A N/A
</TABLE>
*Distributor reserves the right to waive all or a portion of the distribution
fee from time to time.
DATED: February 1998
-7-
<PAGE>
SCHEDULE III
Fees are expressed as a percentage of average annual daily net assets and are
payable monthly.
SERVICE FEE
<TABLE>
<CAPTION>
Class A* Class B Class C Class I
<S> <C> <C> <C> <C>
The Calvert Fund
New Vision Small Cap Fund 0.25 0.25 0.25 N/A
Calvert Income Fund 0.25 0.25 0.25 N/A
Calvert Tax-Free Reserves
Money Market Portfolio N/A N/A N/A N/A
Limited-Term Portfolio N/A N/A N/A N/A
Long-Term Portfolio 0.25 0.25 0.25 N/A
California Money Market Port. N/A N/A N/A N/A
Vermont Municipal N/A 0.25 0.25 N/A
Calvert Municipal Fund
National Intermediate Fund 0.25 0.25 N/A N/A
California Intermediate Fund 0.25 0.25 N/A N/A
Maryland Intermediate Fund 0.25 0.25 N/A N/A
Virginia Intermediate Fund 0.25 0.25 N/A N/A
Calvert Social Investment Fund
Managed Growth Portfolio 0.25 (+) 0.25 0.25 N/A
Equity Portfolio 0.25 0.25 0.25 N/A
Bond Portfolio 0.25 0.25 0.25 N/A
Managed Index Portfolio 0.25 0.25 0.25 N/A
Money Market Portfolio 0.25 N/A N/A N/A
Calvert World Values Fund
Capital Accumulation Fund 0.25 0.25 0.25 N/A
International Equity Fund 0.25 0.25 0.25 N/A
Calvert New World Fund
Calvert New Africa Fund 0.25 0.25 0.25 N/A
First Variable Rate Fund
Calvert First Gov't Money Mkt N/A 0.25 N/A N/A
</TABLE>
DATED: February 1998
- ------------------------------
* Distributor reserves the right to waive all or a portion of the service fees
from time to time. For money market portfolios, Class A shall refer to Class O,
or if the portfolio does not have multiple classes, then to the portfolio
itself.
+ Distributor charges the service fee only on assets in excess of $30 million.
-8-
<PAGE>
Exhibit 10
March 27, 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 - New Vision Small Cap Fund
File numbers 2-76510 and 811-3416
Ladies and Gentlemen:
As 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. 34 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. 34 to its Registration Statement.
Sincerely,
Susan Walker Bender
Associate General Counsel
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees of The Calvert Fund
We consent to the incorporation by reference in Post-Effective Amendment No. 34
to the Registration Statement of The Calvert Fund on Form N-1A (File Numbers 2-
76510 and 811-3416) of our report dated May 9, 1997 on our audit of the
financial statements and financial highlights of Calvert New Vision Small Cap
Fund, which report is included in the Annual Report to Shareholders for the year
ended March 31, 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
March 20, 1998
<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 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>
<PAGE>
<ARTICLE> 6
<CIK> 0000701039
<NAME> THE CALVERT FUND
<SERIES>
<NUMBER> 011
<NAME> CALVERT NEW VISION SMALL CAP FUND, CLASS A
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 2329
<INVESTMENTS-AT-VALUE> 2802
<RECEIVABLES> 44
<ASSETS-OTHER> 749
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3595
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 17
<TOTAL-LIABILITIES> 17
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2880
<SHARES-COMMON-STOCK> 208
<SHARES-COMMON-PRIOR> 101
<ACCUMULATED-NII-CURRENT> (10)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 393
<NET-ASSETS> 3260
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 2
<OTHER-INCOME> 0
<EXPENSES-NET> 12
<NET-INVESTMENT-INCOME> (10)
<REALIZED-GAINS-CURRENT> 143
<APPREC-INCREASE-CURRENT> 490
<NET-CHANGE-FROM-OPS> 623
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 156
<NUMBER-OF-SHARES-REDEEMED> 49
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 107
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 10
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 17
<AVERAGE-NET-ASSETS> 3275
<PER-SHARE-NAV-BEGIN> 11.99
<PER-SHARE-NII> (.05)
<PER-SHARE-GAIN-APPREC> 3.71
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.65
<EXPENSE-RATIO> 1.03
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000701039
<NAME> THE CALVERT FUND
<SERIES>
<NUMBER> 144
<NAME> NEW VISION SMALL CAP, CLASS C
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 2329
<INVESTMENTS-AT-VALUE> 2802
<RECEIVABLES> 44
<ASSETS-OTHER> 749
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3595
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 17
<TOTAL-LIABILITIES> 17
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 245
<SHARES-COMMON-STOCK> 20
<SHARES-COMMON-PRIOR> 17
<ACCUMULATED-NII-CURRENT> (2)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (5)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 80
<NET-ASSETS> 318
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 2
<NET-INVESTMENT-INCOME> (2)
<REALIZED-GAINS-CURRENT> 17
<APPREC-INCREASE-CURRENT> 94
<NET-CHANGE-FROM-OPS> 109
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 23
<NUMBER-OF-SHARES-REDEEMED> 20
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3
<AVERAGE-NET-ASSETS> 380
<PER-SHARE-NAV-BEGIN> 11.99
<PER-SHARE-NII> (.10)
<PER-SHARE-GAIN-APPREC> 3.73
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.62
<EXPENSE-RATIO> 1.30
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<PAGE>
SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
between
CALVERT SHAREHOLDER SERVICES, INC.
and
STATE STREET BANK AND TRUST COMPANY
-1-
<PAGE>
TABLE OF CONTENTS
1. Duties of the Bank. . . . . . . . . . . . . . . . . . . . . . . 1
2. Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . 3
3 Wire Transfer Operating Guidelines. . . . . . . . . . . . . . . 4
4. Data Access and Proprietary Information . . . . . . . . . . . . 5
5. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . 6
6. Standard of Care. . . . . . . . . . . . . . . . . . . . . . . . 8
7. Covenants of the Transfer Agent and the Bank. . . . . . . . . . 8
8. Representations and Warranties of the Bank. . . . . . . . . . . 9
9. Representations and Warranties of the Transfer Agent. . . . . . 9
10. Termination of Agreement. . . . . . . . . . . . . . . . . . . .10
11 Assignment. . . . . . . . . . . . . . . . . . . . . . . . . . .10
12. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . .10
13. Massachusetts Law to Apply. . . . . . . . . . . . . . . . . . .10
14. Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . .11
15. Consequential Damages . . . . . . . . . . . . . . . . . . . . .11
16. Limitation of Shareholder Liability . . . . . . . . . . . . . .11
17. Merger of Agreement . . . . . . . . . . . . . . . . . . . . . .11
18. Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . .11
19. Severability. . . . . . . . . . . . . . . . . . . . . . . . . .11
20. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . .12
-2-
<PAGE>
SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 15th day of August, 1996, by and between,
Calvert Shareholder Services, Inc. a corporation, having its principal office
and place of business at 4550 Montgomery Ave. Suite 1000N, Bethesda,
Maryland, 20814 (the "Transfer Agent"), and STATE STREET BANK AND TRUST
COMPANY, a Massachusetts trust company having its principal office and place
of business at 225 Franklin Street, Boston, Massachusetts 02110 (the "Bank");
WHEREAS, the Transfer Agent has been appointed by each of the investment
companies (including each series thereof) listed on Schedule A (the
"Fund(s)"), each an open-end management investment company registered under
the Investment Company Act of 1940, as amended, as transfer agent, dividend
disbursing agent and shareholder servicing agent in connection with certain
activities, and the Transfer Agent has accepted each such appointment;
WHEREAS, the Transfer Agent has entered into a Transfer Agency and
Service Agreement with each of the Funds (including each series thereof)
listed on Schedule A pursuant to which the Transfer Agent is responsible for
certain transfer agency and dividend disbursing functions for each Fund's
authorized and issued shares of common stock or shares of beneficial interest
as the case may be ("Shares") and each Fund's shareholders ("Shareholders")
and the Transfer Agent is authorized to subcontract for the performance of
its obligations and duties thereunder in whole or in part with the Bank;
WHEREAS, the Transfer Agent desires to appoint the Bank as its
sub-transfer agent, and the Bank desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenant herein
contained, the parties hereto agree as follows:
1. DUTIES OF THE BANK
1.1 Subject to the terms and conditions set forth in this Agreement, the
Bank shall act as the Transfer Agent's sub-transfer agent for Shares in
connection with any accumulation plan, open account, dividend reinvestment
plan, retirement plan or similar plan provided to Shareholders and set out in
each Fund's currently effective prospectus and statement of additional
information ("Prospectus"), including without limitation any periodic
investment plan or periodic withdrawal program. As used herein the term
'"Shares" means the authorized and issued shares of common stock, or shares
of beneficial interest, as the case may be, for each Fund listed in Schedule
A. In accordance with procedures established from time to time by agreement
between the Transfer Agent and the Bank, the Bank shall provide the services
listed in this Section 1.
(a) The Bank shall:
(i) receive for acceptance, orders for the purchase of Shares, and
promptly deliver payment and appropriate documentation thereof to the
Custodian of each
-3-
<PAGE>
Fund authorized pursuant to the Articles of Incorporation or
organization of each Fund (the "Custodian");
(ii) pursuant to purchase orders, issue the appropriate number of
Shares and hold such Shares in the appropriate Shareholder account;
(iii) receive for acceptance redemption requests and redemption
directions and deliver the appropriate documentation thereof to the
Custodian;
(iv) in respect to the transactions in items (i), (ii) and
(iii) above, the Bank shall execute transactions directly with
broker-dealers authorized by each Fund;
(v) at the appropriate time as and when it receives monies paid to
it by the Custodian with respect to any redemption, pay over or cause
to be paid over in the appropriate manner such monies as instructed
by the redeeming Shareholders;
(vi) effect transfers of Shares by the registered owners thereof
upon receipt of appropriate instructions;
(vii) prepare and transmit payments for dividends and distributions
declared by each Fund;
(viii) issue replacement certificates for those certificates alleged
to have been lost, stolen or destroyed upon receipt by the Bank of
indemnification satisfactory to the Bank and protecting the Bank and
each Fund, and the Bank at its option, may issue replacement
certificates in place of mutilated stock certificates upon
presentation thereof and without such indemnity;
(ix) maintain records of account for and advise the Transfer Agent
and its Shareholders as to the foregoing; and
(x) Record the issuance of Shares of each Fund and maintain
pursuant to Rule 17Ad-10(e) of the Securities Exchange Act of 1934 as
amended (the "Exchange Act of 1934") a record of the total number of
Shares of each Fund which are authorized, based upon data provided to
it by each Fund or the Transfer Agent, and issued and outstanding.
The Bank shall also provide each Fund on a regular basis with the
total number of Shares which are authorized and issued and outstanding
and shall have no obligation, when recording the issuance of Shares,
to monitor the issuance of such Shares or to take cognizance of any
laws relating to the issue or sale of such Shares, which functions
shall be the sole responsibility of each Fund or the Transfer Agent.
1.2 (a) For reports, the Bank shall:
-4-
<PAGE>
(i) maintain all Shareholder accounts, prepare meeting, proxy,
and mailing lists, withhold taxes on US resident and non-resident
alien accounts, prepare and file US Treasury Department reports
required with respect to interest, dividends and distributions by
federal authorities for all Shareholders, prepare confirmation forms
and statements of account to Shareholders for all purchases and
redemptions of Shares and other confirmable transactions in
Shareholder account information.
(b) For blue sky reporting the Bank shall provide a system that will
enable each Fund or the Transfer Agent to monitor the total number of
Shares sold in each State, and each Fund or the Transfer Agent shall:
(i) identify to the Bank in writing those transactions and assets
to be treated as exempt from blue sky reporting for each State; and
(ii) verify the establishment of transactions for each State on the
System prior to the activity for each State, the responsibility of
the Bank for each Fund's blue sky state registration status is solely
limited to the initial establishment of transactions subject to blue
sky compliance by the Fund or the Transfer Agent and the reporting of
such transactions to the Fund as provided above.
1.3 Per the attached service responsibility schedule procedures as to who
shall provide certain of these services in Section 1 may be established from
time to time by agreement between the Transfer Agent and the Bank. The Bank
may at times perform only a portion of these services and the Transfer Agent
may perform these services on each Fund's behalf.
1.4 The Bank shall provide additional services on behalf of the Transfer
Agent (i.e., escheat services) that may be agreed upon in writing between the
Bank and the Transfer Agent.
2. FEES AND EXPENSES
2.1 For the performance by the Bank pursuant to this Agreement, the Transfer
Agent agrees to pay the Bank an annual maintenance fee for each Shareholder
account as set out in the initial fee schedule attached hereto. Such fees and
out-of-pocket expenses and advances identified under Section 2.2 below may be
changed from time to time subject to mutual written agreement between the
Transfer Agent and the Bank.
2.2 In addition to the fee paid under Section 2.1 above, the Transfer Agent
agrees to reimburse the Bank for out-of-pocket expenses, including, but not
limited to confirmation production, postage, forms, telephone, microfilm,
microfiche, tabulating proxies, records storage, or advances incurred by the
Bank for the items set out in the fee schedule attached hereto. In addition,
any other expenses incurred by the Bank at the request or with the consent of
the Transfer Agent, will be reimbursed by the Transfer Agent.
-5-
<PAGE>
2.3 The Transfer Agent agrees to pay all fees and reimbursable expenses
within fifteen days following the receipt of the respective billing notice.
Postage for mailing of dividends, proxies, Fund reports and other mailings to
all shareholder accounts shall be advanced to the Bank by the Transfer Agent
at least seven (7) days prior to the mailing date of such materials.
3. WIRE TRANSFER OPERATING GUIDELINES/ARTICLES 4A OF THE UNIFORM COMMERCIAL
CODE
3.1 The Bank is authorized to promptly debit the appropriate Transfer Agent
account(s) upon the receipt of a payment order in compliance with the
selected security procedure (the "Security Procedure") chosen for funds
transfer and in the amount of money that the Bank has been instructed to
transfer. The Bank shall execute payment orders in compliance with the
Security Procedure and with the Transfer Agent's instructions on the
execution date provided that such payment order is received by the customary
deadline for processing such a request, unless the payment order specifies a
later time. All payment orders and communications received after this time
frame will be deemed to have been received the next business day.
3.2 The Transfer Agent acknowledges that the Security Procedure it has
designated on the Transfer Agent Selection Form was selected by the Transfer
Agent from security procedures offered by the Bank. The Transfer Agent shall
restrict access to confidential information relating to the Security
Procedure to authorized persons as communicated to the Bank in writing. The
Transfer Agent must notify the Bank immediately if it has reason to believe
unauthorized persons may have obtained access to such information or of any
change in the Transfer Agent's authorized personnel. The Bank shall verify
the authenticity of all such instructions according to the Security Procedure.
3.3 The Bank shall process all payment orders on the basis of the account
number contained in the payment order. In the event of a discrepancy between
any name indicated on the payment order and the account number, the account
number shall take precedence and govern.
3.4 When a Transfer Agent initiates or receives Automated Clearing House
("ACH") credit and debit entries pursuant to these guidelines and the rules
of the National Automated Clearing House Association and the New England
Clearing House Association, the Bank will act as an Originating Depository
Financial Institution and/or receiving Depository Financial Institution, as
the case may be, with respect to such entries. Credits given by the Bank with
respect to an ACH credit entry are provisional until the Bank receives final
settlement for such entry from the Federal Reserve Bank. If the Bank does not
receive such final settlement, the Transfer Agent agrees that the Bank shall
receive a refund of the amount credited to the Transfer Agent in connection
with such entry, and the party making payment to the Transfer Agent via such
entry shall not be deemed to have paid the amount of the entry.
3.5 The Bank reserves the right to decline to process or delay the
processing of a payment order which (a) is in excess of the collected balance
in the account to be charged at the time of the Bank's receipt of such
payment order, or (b) if the Bank, in good faith, is unable to satisfy itself
that the transaction has been properly authorized.
-6-
<PAGE>
3.6 The Bank shall use reasonable efforts to act on all authorized requests
to cancel or amend payment orders received if requests are received in a
timely manner affording the Bank reasonable opportunity to act. However, the
Bank assumes no liability if the request for amendment or cancellation cannot
be satisfied.
3.7 The Bank shall assume no responsibility for failure to detect any
erroneous payment order provided that the Bank complies with the payment
order instructions as received and the Bank complies with the Security
Procedure. The Security Procedure is established for the purpose of
authenticating payment orders only and not for the detection of errors in
payment orders.
3.8 The Bank shall assume no responsibility for lost interest with respect
to the retransfer Agentable amount of any unauthorized payment order unless
the Bank is notified of the unauthorized payment order within thirty (30)
days of notification by the Bank of the acceptance of such payment order. In
no event (including failure to execute a payment order) shall the Bank be
liable for special, indirect or consequential damages, even if advised of the
possibility of such damages.
3.9 Confirmation of Bank's execution of payment orders shall ordinarily be
provided within 24 hours notice of which may be delivered through the Bank's
proprietary information systems, or by facsimile or call-back. Client must
report any objections to the execution of an order within 30 days.
4. DATA ACCESS AND PROPRIETARY INFORMATION
The Transfer Agent acknowledges that the data bases, computer programs, screen
formats, report formats, interactive design techniques, and other information
furnished to the Transfer Agent by the Bank are provided solely in connection
with the services rendered under this Agreement and constitute copyrighted trade
secrets or proprietary information of substantial value to the Bank. Such
databases, programs, formats, designs, techniques and other information are
collectively referred to below as "Proprietary Information". The Transfer Agent
agrees that it shall treat all Proprietary Information as proprietary to the
Bank and further agrees that it shall not divulge any Proprietary Information to
any person or organization except as expressly permitted hereunder. The Transfer
Agent agrees for itself and its employees and Agents:
(a) to use such programs and databases (i) solely on the Transfer Agent's
computers, or (ii) solely from equipment at the locations agreed to between
the Transfer Agent and the Bank and (iii) in accordance with the Bank's
applicable user documentation;
(b) to refrain from copying or duplicating in any way (other than in the
normal course of performing processing on the Transfer Agent's computers)
any part of any Proprietary Information;
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<PAGE>
(c) to refrain from obtaining unauthorized access to any programs, data or
other information not owned by the Transfer Agent, and if such access is
accidentally obtained, to respect and safeguard the same Proprietary
Information;
(d) to refrain from causing or allowing proprietary information
transmitted from the Bank's computer to the Transfer Agent's terminal to be
retransmitted to any other computer terminal or other device except as
expressly permitted by the Bank, such permission not to be unreasonably
withheld;
(e) that the Transfer Agent shall have access only to those authorized
transactions as agreed to between the Transfer Agent and the Bank; and
(f) to honor reasonable written requests made by the Bank to protect at
the Bank's expense the rights of the Bank in Proprietary Information at
common law and under applicable statutes.
Each party shall take reasonable efforts to advise its employees of their
obligations pursuant to this Section 4.
5. INDEMNIFICATION
5.1 Except as provided in Section 6, herein, the Bank shall not be
responsible for, and the Transfer Agent shall indemnify and hold the Bank
harmless from and against, any and all losses, damages, costs, charges,
counsel fees, payments, expenses and liability arising out of or attributable
to:
(a) all actions of the Bank or its agent or subcontractors required to be
taken pursuant to this Agreement, provided that such actions are taken in
good faith and without negligence or willful misconduct;
(b) the Transfer Agent's lack of good faith, negligence or willful
misconduct;
(c) the reliance on or use by the Bank or its agents or subcontractors of
information, records, documents or services which (i) are given to the
Bank or its agents or subcontractors, and (ii) have been prepared,
maintained or performed by the Transfer Agent or any other person or firm
on behalf of the Transfer Agent including but not limited to any previous
transfer agent or registrar excluding the Bank;
(d) the reliance on, or the carrying out by the Bank or its agents or
subcontractors of any instructions or requests of the Transfer Agent; and
(e) the offer or sale of Shares in violation of any requirement under the
federal securities laws or regulations or the securities laws or
regulations of any state that such Shares be registered in such state or in
violation of any stop order or other determination
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<PAGE>
or ruling by any federal agency or any state with respect to the offer or
sale of such Shares in such state.
5.2 At any time the Bank may apply to any officer of the Transfer Agent for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by the Bank under
this Agreement, and the Bank and its Agents or subcontractors shall not be
liable and shall be indemnified by the Transfer Agent for any action taken or
omitted by it in reliance upon such instructions or upon the opinion of such
counsel.
The Bank, its agents and subcontractors shall be protected and indemnified in
acting upon any paper or document furnished by or on behalf of the Transfer
Agent, reasonably believed by the Batik as being in good order and to have been
signed by the proper person or persons, or upon any instruction, information,
data, records or documents provided the Bank or its Agents or subcontractors by
machine readable input, telex, CRT data entry or other similar means authorized
by the Transfer Agent, and shall not be held to have notice of any change of
authority of any person, until receipt of written notice thereof from the
Transfer Agent. The Bank, its agents and subcontractors shall also be protected
and indemnified in recognizing stock certificates which are reasonably believed
to bear the proper manual or facsimile signatures of the officers of the
Transfer Agent, and the proper countersignature of the Transfer Agent or any
former transfer agent or former registrar, or of a co-transfer agent or
co-registrar.
5.3 In order that the indemnification provisions contained in this Section 5
shall apply, upon the assertion of a claim for which the Transfer Agent may
be required to indemnify the Bank, the Bank shall promptly notify the
Transfer Agent of such assertion, and shall keep the Transfer Agent advised
with respect to all developments concerning such claim. The Transfer Agent
shall have the option to participate with the Bank in the defense of such
claim or to defend against said claim in its own name or in the name of the
Bank. The Bank shall in no case confess any claim or make any compromise in
any case in which the Transfer Agent may be required to indemnify the Bank
except with the Transfer Agent's prior written consent.
6. STANDARD OF CARE
6.1 The Bank shall at all times act in good faith and agrees to use its best
efforts within reasonable limits to insure the accuracy of all services
performed under this Agreement, but assumes no responsibility and shall not
be liable for loss or damage due to errors unless said errors are caused by
its negligence, bad faith, or willful misconduct or that of its employees.
6.2 The Bank shall work with the Transfer Agent to ensure that a Fund is
made whole by the responsible party for any material losses or damages
resulting from errors, material unreconciled items, carelessness, negligence,
bad faith, or willful misconduct by the Bank or its agents or subcontractors,
or that of their employees. Neither the Bank, its agents or subcontractors,
nor the Transfer Agent may waive full liability for losses or damages based
on the above.
6.3 Errors identified as caused by the sub-transfer agent will not be
charged to the Funds in the monthly billing.
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<PAGE>
7. COVENANTS OF THE TRANSFER AGENT AND THE BANK
7.1 The Bank hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Transfer Agent for safekeeping of
stock certificates, check forms and facsimile signature imprinting devices,
if any; and for the preparation or use, and for keeping account of, such
certificates, forms and devices.
7.2 The Bank shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the extent
required by Section 31 of the Investment Company Act of 1940, as amended, and
the Rules thereunder, the Bank agrees that all such records prepared or
maintained by the Bank relating to the services to be performed by the Bank
hereunder are the property of the Transfer Agent and will be preserved,
maintained and made available in accordance with such Section and Rules, and
will be surrendered promptly to the Transfer Agent on and in accordance with
its request.
7.3 The Bank and the Transfer Agent agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential, and shall not be voluntarily disclosed
to any other person, except as may be required by law.
7.4 In case of any requests or demands for the inspection of the Shareholder
records of the Transfer Agent, the Bank will endeavor to notify the Transfer
Agent and to secure instructions from an authorized officer of the Transfer
Agent as to such inspection. The Bank reserves the right, however, to exhibit
the Shareholder records to any person whenever it is advised by its counsel
that it may be held liable for the failure to exhibit the Shareholder records
to such person.
8. REPRESENTATIONS AND WARRANTIES OF THE BANK
The Bank represents and warrants to the Transfer Agent that:
(a) it is a trust company duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts;
(b) it is duly qualified to carry on its business in The Commonwealth of
Massachusetts;
(c) it is empowered under applicable laws and by its Charter and By-Laws
to enter into and perform this Agreement;
(d) all requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement;
(e) it has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement; and
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<PAGE>
(f) it is registered as a transfer agent undo Section 17A(c)(2) of the
Exchange Act.
9. REPRESENTATIONS AND WARRANTIES OF THE TRANSFER AGENT
The Transfer Agent represents and warrants to the Bank that:
(a) it is a corporation duly organized and existing and in good standing
under the laws of the State of Delaware;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement;
(c) all corporate proceedings required by said Articles of Incorporation
and By-Laws have been taken to authorize it to enter into and perform
this Agreement.
(d) it is registered as a transfer agent under Section 17A(c)(2) of the
Exchange Act.
10. TERMINATION OF AGREEMENT
10.1 This Agreement shall continue for a period of five years (the "Initial
Term") and be renewed or terminated as stated below.
10.2 This Agreement shall terminate upon the termination of the Transfer
Agency Agreement between the Funds and the Transfer Agent.
10.3 This Agreement may be terminated or renewed after the Initial Term by
either party upon ninety (90) days written notice to the other.
10.4 Should the Transfer Agent exercise its right to terminate, all
reasonable out-of-pocket expenses associated with the movement of records and
material will be borne by the Transfer Agent. Additionally, the Bank reserves
the right to charge for any other reasonable expenses associated with such
termination and/or a charge equivalent to the average of three (3) months'
fees.
11. ASSIGNMENT
11.1 Except as provided in Section 11.3 below, neither this Agreement nor any
rights or obligations hereunder may be assigned by either party without the
written consent of the other party.
11.2 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
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<PAGE>
11.3 The Bank will, without further consent on the part of the Transfer
Agent, subcontract for the performance hereof with National Financial Data
Services, Inc., a subsidiary of BFDS duly registered as a transfer agent
pursuant to Section 17A(c)(2) provided, however, that the Bank shall be as
fully responsible to the Transfer Agent for the acts and omissions of any
subcontractor as it is for its own acts and omissions.
12. AMENDMENT
This Agreement may be amended or modified by a written agreement executed by
both parties.
13. MASSACHUSETTS LAW TO APPLY
This Agreement shall be construed and the provisions thereof interpreted under
and in accordance with the laws of The Commonwealth of Massachusetts.
14. FORCE MAJEURE
In the event either party is unable to perform its obligations under the terms
of this Agreement because of acts of God, strikes, equipment or transmission
failure or damage reasonably beyond its control, or other causes reasonably
beyond its control, such party shall not be liable for damages to the other for
any damages resulting from such failure to perform or otherwise from such
causes.
15. CONSEQUENTIAL DAMAGES
Neither party to this Agreement shall be liable to the other party for
consequential damages under any provision of this Agreement or for any
consequential damages arising out of any act or failure to act hereunder.
16. LIMITATIONS OF SHAREHOLDER LIABILITY
Each party hereby expressly acknowledges that recourse against the Funds shall
be subject to those limitations provided by governing law and the Declaration of
Trust or Articles of Incorporation of the Funds, as applicable, and agrees that
obligations assumed by the Funds pursuant to the Transfer Agency Agreement shall
be limited in all cases to the Funds and their respective assets. Each party
shall not seek satisfaction from the Shareholders or any individual Shareholder
of the Funds, nor shall any party seek satisfaction of any obligations from the
Directors\Trustees or any individual Director\Trustee of the Funds.
17. MERGER OF AGREEMENT
This Agreement constitutes the entire agreement between the parties hereto and
supersedes any prior agreement with respect to the subject matter hereof whether
oral or written.
18. SURVIVAL
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<PAGE>
All provisions regarding indemnification, warranty, liability, and limits
thereon, and confidentiality and/or protection of proprietary rights and trade
secrets shall survive the termination of this Agreement.
19. SEVERABILITY
If any provision or provisions of this Agreement shall be held invalid,
unlawful, or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired.
20. COUNTERPARTS
This Agreement may be executed by the parties hereto on any number of
counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized
officers, as of the day first written above.
CALVERT SHAREHOLDER SERVICES, INC.
BY: /s/ Karen Becker
TITLE: Vice President
ATTEST: Katherine Stoner
STATE STREET BANK AND TRUST COMPANY
BY: /s/ Ronald E. Logue
TITLE: Executive Vice President
ATTEST: Francine Hayes
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<PAGE>
AMENDMENT TO SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
CALVERT SHAREHOLDER SERVICES, INC.
AND
STATE STREET BANK AND TRUST COMPANY
GENERAL BACKGROUND:
Calvert Shareholder Services, Inc. ("CSSI"), and State Street Bank and Trust
Company ("State Street") entered into a sub-transfer agency and service
agreement ("Agreement") dated August 15, 1996.
For accounting reasons, CSSI desires to amend the Agreement by assigning the
contract for the transfer agent functions (except for shareholder servicing) to
each Calvert Group Fund. CSSI will continue to be responsible for the
shareholder servicing and for any responsibilities currently shown as Transfer
Agent responsibilities in Fund Service Responsibilities attachment to the
Agreement.
The Agreement must be assigned to the Calvert Group Funds for accounting
purposes.
CSSI and State Street must each consent to this assignment.
CHANGES CAUSED BY THIS ASSIGNMENT:
The current subtransfer agent, National Financial Data Services, Inc. ("NFDS"),
will bill each Calvert Group Fund, rather than CSSI, and each Calvert Group Fund
shall pay State Street or its billing agent, NFDS, all fees and expenses
incurred under the Agreement on behalf of each respective Calvert Group Fund.
NFDS will be shown in each Calvert Group Fund prospectus and statement of
additional information as the Transfer Agent, while CSSI will be shown as the
shareholder servicing agent.
State Street (NFDS) will continue to perform those functions shown in the
Agreement as Bank responsibilities.
CSSI will continue to perform the Transfer Agent responsibilities, as shown in
the Fund Service Responsibilities attachment to the Agreement.
THE ASSIGNMENT:
THIS AMENDMENT, dated as of the first day of January, 1998, by and among CSSI
and State Street:
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<PAGE>
NOW, THEREFORE, CSSI and State Street each hereby agree that the Agreement will
be between each Calvert Group Fund and State Street, and each hereby agrees that
the Agreement is so assigned.
IN WITNESS WHEREOF, CSSI and State Street have caused this Amendment to be
executed by their duly authorized officers, effective as of January 1, 1998.
Calvert Shareholder Services, Inc. State Street Bank and Trust Company
By: /s/ By: /s/
Name: Karen Becker Name: Ronald E. Logue
Title: Vice President, Operations Title: Executive Vice President
Date: February 18, 1998 Date: February 20, 1998
Acacia Capital Corporation
First Variable Rate Fund
Calvert Tax-Free Reserves
Calvert Social Investment Fund
Calvert Cash Reserves
The Calvert Fund By: /s/
Calvert Municipal Fund, Inc. Name: William M. Tartikoff
Calvert World Values Fund, Inc. Title: Senior Vice President
Calvert New World Fund, Inc. and Secretary
Date: February 18, 1998
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<PAGE>
SERVICING AGREEMENT
This Agency Agreement, effective January 1, 1998, by and between Calvert
Shareholder Services, Inc., a Delaware corporation having its principal place of
business in Bethesda, Maryland ("CSS"), and registered investment companies
sponsored by Calvert Group, Ltd. and its subsidiaries and set forth on Schedule
A ("Calvert Group Funds" or "Funds"). The Funds have entered into a transfer
agency and service agreement with the State Street Bank and Trust of Boston,
Massachusetts ("State Street") ("State Street Agreement").
1. APPOINTMENTS. The Funds hereby appoints CSS as servicing agent, agent
and shareholder servicing agent for the Funds, and CSS hereby accepts such
appointment and agrees to perform those duties in accordance with the terms and
conditions set forth in this Agreement.
2. DOCUMENTATION. The Funds will furnish CSS with all documents,
certificates, contracts, forms, and opinions which CSS, in its discretion, deems
necessary or appropriate in connection with the proper performance of its duties
under this Agreement.
3. SERVICES TO BE PERFORMED. CSS will be responsible for telephone
servicing functions, system interface with State Street and oversight of State
Street's administering and performing their duties pursuant to the State Street
Agreement. The details of the operating standards and procedures to be followed
will be determined from time to time by agreement between CSS and the Funds.
4. RECORDKEEPING AND OTHER INFORMATION. CSS will, commencing on the
effective date of this Agreement, to the extent necessary create and maintain
all necessary shareholder accounting records in accordance with all applicable
laws, rules and regulations, including but not limited to records required by
Section 31(a) of the Investment Company Act of 1940, as amended (the "1940
Act"), and the rules thereunder, as amended from time to time. All such records
will be the property of the Fund and will be available for inspection and use by
such Fund.
5. AUDIT, INSPECTION AND VISITATION. CSS will make available during
regular business hours all records and other data created and maintained
pursuant to this Agreement for reasonable audit and inspection by the SEC, a
Fund or any person retained by a Fund.
6. COMPENSATION. The Funds will compensate CSS on a monthly basis for the
services performed pursuant to this Agreement, at the rate of compensation set
forth in Schedule A. Out of pocket expenses incurred by CSS and not included in
Schedule A will be reimbursed to CSS by the Fund, as appropriate; such expenses
may include, but are not limited to, special forms and postage for mailing the
forms. These charges will be payable in full upon receipt of a billing invoice.
In lieu of reimbursing CSS for these expenses, any Fund may, in its discretion,
directly pay the expenses.
7. USE OF NAMES. No Fund will not use the name of CSS in any prospectus,
sales literature or other material relating to the Fund in any manner without
prior approval by CSS; provided, however, that CSS will approve all uses of its
name that merely refer in accurate terms to its appointment under this Agreement
or that are required by the SEC or a State Securities Commission; and, provided,
further, that in no event will approval be unreasonably withheld.
8. SECURITY. CSS represents and warrants that, to the best of its
knowledge, the various procedures and systems that CSS proposes to implement
with regard to safeguarding from loss or damage attributable to fire, theft or
any other cause (including provision for twenty-four hour a day restricted
access) the Fund's, records and other data and CSS's records, data, equipment,
facilities and other property used in the performance of its obligations under
this Agreement are adequate and that it will implement them in the manner
proposed and make such changes from time to time as in its judgment are required
for the secure performance of obligations under this Agreement.
9. LIMITATION OF LIABILITY. Each Fund will indemnify and hold CSS
harmless against any losses, claims, damages, liabilities or expenses (including
reasonable counsel fees and expenses) resulting from any claim, demand, action
or suit brought by any person (including a shareholder naming such Fund as a
party) other than such Fund not resulting from CSS's bad faith, willful
misfeasance, reckless disregard of its obligations and duties, or negligence
arising out of, or in connection with, CSS's performance of its obligations
under this Agreement.
To the extent CSS has not acted with bad faith, willful misfeasance,
reckless disregard of its obligations and duties, or gross negligence, each Fund
will also indemnify and hold CSS harmless against any losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action or suit resulting from the negligence
of such Fund, or CSS's acting upon any instructions reasonably believed by it to
have been executed or communicated by any person duly authorized by such Fund,
or
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<PAGE>
as a result of CSS's acting in reliance upon advice reasonably believed by CSS
to have been given by counsel for the Fund, or as a result of CSS's acting in
reliance upon any instrument reasonably believed by it to have been genuine and
signed, countersigned or executed by the proper person.
CSS's liability for any and all claims of any kind, including negligence,
for any loss or damage arising out of, connected with, or resulting from this
Agreement, or from the performance or breach thereof, or from the design,
development, lease, repair, maintenance, operation or use of data processing
systems and the maintenance of a Funds' shareholder account records as provided
for by this Agreement will in the aggregate not exceed the total of CSS's
compensation hereunder for the six months immediately preceding the discovery of
the circumstances giving rise to such liability.
In no event will CSS be liable for indirect, special, or consequential
damages (even if CSS has been advised of the possibility of such damages)
arising from the obligations assumed hereunder and the services provided for by
this Agreement, including but not limited to lost profits, loss of use of the
shareholder accounting system, cost of capital, cost of substitute facilities,
programs or services, downtime costs, or claims of shareholders for such damage.
10. LIMITATION OF LIABILITY OF THE FUND. CSS acknowledges that it accepts
the limitations upon the liability of the Funds. CSS agrees that each Fund's
obligations under this Agreement in any case will be limited to such Fund and to
its assets and that CSS will not seek satisfaction of any obligation from the
shareholders of the Fund nor from any director, trustee, officer, employee or
agent of such Fund.
11. FORCE MAJEURE. CSS will not be liable for delays or errors occurring
by reason of circumstances beyond its control, including but not limited to acts
of civil or military authority, national emergencies, work stoppages, fire,
flood, catastrophe, acts of God, insurrection, war, riot, or failure of
communication or power supply. In the event of equipment breakdowns beyond its
control, CSS will take reasonable steps to minimize service interruptions but
will have no liability with respect thereto.
12. AMENDMENTS. CSS and each Fund will regularly consult with each other
regarding CSS's performance of its obligations under this Agreement. Any change
in a Fund's registration statements under the Securities Act of 1933, as
amended, or the 1940 Act or in the forms relating to any plan, program or
service offered by the current prospectus which would require a change in CSS's
obligations under this Agreement will be subject to CSS's approval, which will
not be unreasonably withheld. Neither this Agreement nor any of its provisions
may be changed, waived, discharged, or terminated orally, but only by written
instrument which will make specific reference to this Agreement and which will
be signed by the party against which enforcement of such change, waiver,
discharge or termination is sought.
13. TERMINATION. This Agreement will continue in effect until January 1,
1999, and thereafter as the parties may mutually agree; provided, however, that
this Agreement may be terminated at any time by either party upon at least sixty
days' prior written notice to the other party; and provided further that this
Agreement may be terminated immediately at any time for cause either by any Fund
or CSS in the event that such cause remains unremedied for no less than ninety
days after receipt of written specification of such cause. Any such termination
will not affect the rights and obligations of the parties under Paragraphs 9 and
10 hereof. In the event that a Fund designates a successor to any of CSS's
obligations hereunder, CSS will, at the expense and direction of such Fund,
transfer to such successor all relevant books, records and other data of such
Fund established or maintained by CSS under this Agreement.
15. MISCELLANEOUS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes of
this Agreement. This Agreement will be construed and enforced in accordance with
and governed by the laws of the State of Maryland. The captions in this
Agreement are included for convenience only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above written.
CALVERT GROUP FUNDS
By:/s/ William M. Tartikoff
CALVERT SHAREHOLDER SERVICES, INC.
By:/s/ Ronald M. Wolfsheimer
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<PAGE>
SERVICING AGREEMENT
SCHEDULE A
For its services under this Servicing Agreement, Calvert Shareholder
Services, Inc., is entitled to receive from the Calvert Funds (Except Acacia
Capital Corporation) fees as set forth below:
<TABLE>
<CAPTION>
Annual Transaction
Fund and Portfolio Account Fee * Fee
<S> <C> <C>
FIRST VARIABLE RATE FUND
First Variable Rate Fund (d/b/a Calvert First $11.59 $.84
Government Money Market)
Calvert Florida Municipal Intermediate Fund 2.23 .26
CALVERT TAX-FREE RESERVES
Money Market 13.35 .97
Limited-Term 3.37 .42
Long-Term 2.67 .31
California Money Market 12.74 .93
Vermont Municipal 3.40 .39
CALVERT MUNICIPAL FUND, INC
California Intermediate 3.48 .40
National Intermediate 3.31 .38
Maryland Intermediate 4.64 .53
Michigan Intermediate 3.88 .44
New York Intermediate 4.23 .48
Virginia Intermediate 3.35 .38
Arizona Intermediate 2.10 .24
Pennsylvania Intermediate 2.82 .32
THE CALVERT FUND
Income 4.22 .48
New Vision Small Cap 5.90 .67
CALVERT SOCIAL INVESTMENT FUND
Money Market 11.92 .87
Bond 4.85 .55
Managed Growth 4.63 .72
Equity 5.24 .60
CALVERT WORLD VALUES FUND, INC.
International Equity 5.36 .61
Capital Accumulation 6.26 .72
CALVERT NEW WORLD FUND
New Africa Fund 3.91 .45
</TABLE>
ACACIA CAPITAL CORPORATION FEE IS AS FOLLOWS:
.03% (three basis points) on the first $500 million of average net assets
and .02% (two basis points) over $500 million of average net assets, minus the
fees paid by Acacia Capital Corporation to State Street Bank and Trust pursuant
to the State Street Agreement (except for out of pocket expenses).
- ----------------
* Account fees are charged monthly based on the highest number of non-zero
balance accounts outstanding during the month.
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<PAGE>
THE CALVERT GROUP OF FUNDS
CLASS B AND CLASS C DISTRIBUTION PLAN
As approved by the Boards in November 1993
Amended and restated February 1998 Pursuant to Rule 12b-1
Under the Investment Company Act of 1940
This Distribution Plan applies to Class B and Class C in each portfolio of
the Calvert Funds listed in Schedule A (each a "Fund" and together, the "Funds")
and to any future class for which this Distribution Plan has been approved in
accordance with paragraph 2(a) below. For purposes of this Distribution Plan
each series portfolio of a Fund is referred to herein as a "Series" and
together, as the "Series".
As permitted by Rule 12b-1 under the Investment Company Act of 1940 and in
accordance with the terms and conditions of this Plan, as hereinafter set forth,
a Fund may incur certain expenditures to promote itself and further the
distribution of its shares.
1. PAYMENT OF FEE
(a) As compensation for certain services performed and expenses assumed by
each Fund's distributor and principal underwriter ("Distributor") each Fund may
pay the Distributor a distribution fee (the "Distribution Fee"). The
Distribution Fee is intended to compensate the Distributor for its marketing
efforts, which include, but are not limited to the following costs: commissions
and other payments advanced to sales personnel and third parties and related
interest costs as permitted by the rules of the National Association of
Securities Dealers, Inc. ("NASD"), printing and mailing prospectuses, sales
literature and other relevant material to other than current shareholders,
advertising and public relations, telemarketing, marketing-related overhead
expenses and other distribution costs. Such Distribution Fee is in addition to
any NASD service fee that may be paid hereunder and as described at Section 3(b)
of the Distribution Agreement between the respective Funds and the Distributor,
or any front-end or deferred sales charges the Distributor receives from a Fund
with respect to sales or redemption of Fund shares. Total fees paid pursuant to
this Plan, including the Distribution Fee described above, and the NASD service
fee, shall not exceed the rate set forth in the attached Schedule B to this
Plan. All agreements with any person relating to the implementation of this
Plan shall be in writing, and such agreements shall be subject to termination,
without penalty, pursuant to the provisions of paragraph 2(c) of this Plan.
(b) A Fund will pay each person which has acted as principal underwriter
of its Class B shares its Allocable Portion (as such term is defined in the
Distribution Agreement pursuant to which such person acts or acted as principal
underwriter of the Class B Shares (the "Applicable Distribution Agreement")) of
the Distribution Fee in respect of Class B Shares of the Fund. Such person
shall be paid its Allocable Portion of such Distribution Fees notwithstanding
such person's termination as Distributor of the Class B Shares of the Fund, such
payments to be changed or terminated only: (i) as required by a change in
applicable law or a change in accounting policy adopted by the Investment
Companies Committee of the AICPA and approved by FASB that results in a
determination by the Fund's independent accountants that any asset based sales
charges (as that term is defined by the NASD) in respect of such Fund, and which
are not yet due and payable, must be accounted for by such Fund as a liability
in accordance with GAAP, each after the effective date of this restated
Distribution Plan; (ii) if in the sole discretion of the Board of
Trustees/Directors, after due consideration of the relevant factors considered
when adopting and/or amending this Distribution Plan including the transactions
contemplated in that certain Purchase and Sale Agreement entered into between a
Fund's Distributor and the commission financing entity, the Board of
Trustees/Directors determines, subject to its fiduciary duty, that this
Distribution Plan and the payments thereunder must be changed or terminated,
notwithstanding the effect this action might have on the Fund's ability to offer
and sell Class B shares; or (iii) in connection with a Complete Termination of
this Distribution Plan, it being understood that for this purpose a Complete
Termination of this Distribution Plan occurs only if, as to a Fund or Series,
this Distribution Plan is terminated and the Fund has not adopted any other
distribution plan with respect to its Class B or other substantially similar
class of shares. The services rendered by a Distributor for which that
Distributor is entitled to receive its Allocable Portion of the Distribution Fee
shall be deemed to have been completed at the time
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<PAGE>
of the initial purchase of the Commission Shares (as defined in the Distribution
Agreement) taken into account in computing that Distributor's Allocable Portion
of the Distribution Fee.
The obligation of a Fund to pay the Distribution Fee shall terminate upon
the termination of this Distribution Plan as to such Fund in accordance with the
terms hereof. Except as provided in the preceding paragraph, a Fund's
obligation to pay the Distribution Fee to a Distributor of the Class B Shares of
the Fund shall be absolute and unconditional and shall not be subject to any
dispute, offset, counterclaim or defense whatsoever (it being understood that
nothing in this sentence shall be deemed a waiver by a Fund of its right
separately to pursue any claims it may have against such Distributor and enforce
such claims against any assets (other than its right to be paid its Allocable
Portion of the Distribution Fee and to be paid the contingent deferred sales
charges) of such Distributor).
The right of a Distributor to receive the Distribution Fee, but not the
relevant Distribution Agreement or that Distributor's obligations thereunder,
may be transferred by that Distributor in order to raise funds which may be
useful or necessary to perform its duties as principal underwriter, and any such
transfer shall be effective upon written notice from that Distributor to the
Fund. In connection with the foregoing, each Fund is authorized to pay all or
part of the Distribution Fee directly to such transferee as directed by that
Distributor.
(c) Nothing in this Distribution Plan shall operate or be construed to
limit the extent to which the Fund's Investment Advisor or any other person,
other than the Fund, at its expense apart from the Distribution Plan, may incur
costs and pay expenses associated with the distribution of Fund shares.
2. EFFECTIVE DATE AND TERM
(a) This Distribution Plan shall become effective as to any Class of any
Series upon approval by majority votes of (i) the Board of the Fund and the
members thereof who are not interested persons within the meaning of Section
2(a)(19) of the Investment Company Act of 1940 and have no direct or indirect
financial interest in the operation of the Distribution Plan or in any
agreements related to the Distribution Plan ("Qualified Trustees/Directors"),
cast in person at a meeting called for the purpose of voting on this
Distribution Plan, and (ii) the outstanding voting securities of the Fund.
(b) This Distribution Plan shall remain in effect for one year from its
adoption date and may continue in effect thereafter if this Distribution Plan is
approved at least annually by a majority vote of the Board of the Fund,
including a majority of the Qualified Trustees/Directors, cast in person at a
meeting called for the purpose of voting on the Distribution Plan.
(c) Subject to paragraph 1(b) above, this Distribution Plan may be
terminated at any time without payment of any penalty by a majority vote of the
Qualified Trustees/Directors or by vote of a majority of the outstanding voting
securities of the Fund, or, with respect to the termination of this Distribution
Plan as to a particular Class of a Portfolio, by a vote of a majority of the
outstanding voting securities of that Class.
(d) The provisions of this Distribution Plan are severable for each Series
or Class, and whenever action is to be taken with respect to this Distribution
Plan, that action must be taken separately for each Series or Class affected by
the matter.
3. REPORTS
The person authorized to direct the disposition of monies paid or
payable by the Fund pursuant to the Distribution Plan shall provide, on at least
a quarterly basis, a written report to each Fund's Board of the amounts expended
pursuant to this Distribution Plan or any related agreements and the purposes
for which such expenditures were made.
4. SELECTION OF DISINTERESTED TRUSTEES/DIRECTORS
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<PAGE>
While this Distribution Plan is in effect, the selection and
nomination of those Trustees/Directors who are not interested persons of a Fund
within the meaning of Section 2(a)(19) of the Investment Company Act of 1940
shall be committed to the discretion of the Trustees/Directors then in office
who are not interested persons of the Fund.
5. EFFECT OF PLAN
This Distribution Plan shall not obligate the Fund or any other party
to enter into an agreement with any particular person.
6. AMENDMENT
This Distribution Plan may not be amended to increase materially the
amount authorized in paragraph 1 hereof to be spent by a Fund for distribution
without approval by a vote of the majority of the outstanding shares of such
Fund, except that if the amendment relates only to a particular Class of a Fund,
such approval need only be by a vote of the majority of the outstanding shares
of that Class. All material amendments to this Distribution Plan must be
approved by a majority vote of the Board of the Fund, and of the Qualified
Trustees/Directors, cast in person at a meeting called for the purpose of voting
thereon.
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<PAGE>
SCHEDULE A
The Calvert Fund
Calvert Tax-Free Reserves
Calvert Municipal Fund
Calvert Social Investment Fund
Calvert World Values Fund
Calvert New World Fund
First Variable Rate Fund
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<PAGE>
SCHEDULE B
The total fees paid by the respective Class of each Series of a Fund
pursuant to this Distribution Plan shall not exceed the rate, as a percentage of
that Class' average annual net assets, set forth below:
<TABLE>
<CAPTION>
FUND/SERIES CLASS B CLASS C
Distribution Service Distribution Service
Fee Fee Fee Fee
<S> <C> <C> <C> <C>
The Calvert Fund
Calvert New Vision
Small Cap Fund 0.75 0.25 0.75 0.25
Calvert Income Fund 0.75 0.25 0.75 0.25
Calvert Tax-Free Reserves
Long-Term 0.75 0.25 0.75 0.25
Vermont Municipal 0.75 0.25 0.75 0.25
Calvert Municipal Fund
National 0.75 0.25 N/A N/A
California 0.75 0.25 N/A N/A
Maryland 0.75 0.25 N/A N/A
Virginia 0.75 0.25 N/A N/A
Calvert Social Investment Fund
Managed Growth 0.75 0.25 0.75 0.25
Equity 0.75 0.25 0.75 0.25
Bond 0.75 0.25 0.75 0.25
Managed Index 0.75 0.25 0.75 0.25
Calvert World Values Fund
International Equity 0.75 0.25 0.75 0.25
Capital Accumulation 0.75 0.25 0.75 0.25
Calvert World Values Fund
Calvert New Africa 0.75 0.25 0.75 0.25
First Variable Rate Fund
Calvert First Gov.
Money Market 0.75 0.25 N/A N/A
</TABLE>
Restated Feb. 1998
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<PAGE>
THE CALVERT GROUP OF FUNDS
RULE 18f-3 MULTIPLE CLASS PLAN
Approved by the Boards in January 1996
Amended and restated February 1998 Pursuant to Rule 18f-3
Under the Investment Company Act of 1940
Rule 18f-3 under the Investment Company Act of 1940, as amended (the "1940
Act"), requires that an investment company desiring to offer multiple classes of
shares pursuant to the Rule adopt a plan setting forth the differences among the
classes with respect to shareholder services, distribution arrangements, expense
allocations and any related conversion features or exchange privileges. Any
material amendment to the plan must be approved by the investment company's
Board of Trustees/Directors, including a majority of the disinterested Board
members, who must find that the plan is in the best interests of each class
individually and the investment company as a whole.
This Rule 18f-3 Multiple Class Plan ("Plan") shall apply to those funds in
the Calvert Group of Funds listed in Exhibit I (each a "Fund" and collectively,
"Funds") and to any future fund for which this Plan has been approved in
accordance with the above paragraph.
The provisions of this Plan are severable for each Fund or Series thereof
("Series") or Class, and whenever action is to be taken with respect to this
Plan, that action must be taken separately for each Fund, Series or Class
affected by the matter.
1. CLASS DESIGNATION. A Fund may offer shares designated Class A, Class
B, Class C , Class I, and for certain money market portfolios, Class O.
2. DIFFERENCES IN AVAILABILITY. Class A, Class B, Class C, and Class O
shares shall each be available through the same distribution channels, except
that (a) Class B shares may not be available through some dealers and are not
available for purchases of $500,000 or more, (b) Class B shares of Calvert First
Government Money Market Fund are available only through exchange from Class B or
Class C shares of another Calvert Fund, and (c) Class C shares may not be
available through some dealers and are not available for purchases of $1 million
or more. Class I shares are generally available only directly from Calvert Group
and not through dealers, and each Class I shareholder must maintain a $1 million
minimum account balance.
3. DIFFERENCES IN SERVICES. The services offered to shareholders of each
Class shall be substantially the same, except that the Rights of Accumulation,
Letters of Intent and Reinvestment Privileges shall be available only to holders
of Class A shares. Class I purchases and redemptions may only be made by bank
wire.
4. DIFFERENCES IN DISTRIBUTION ARRANGEMENTS. Class A shares shall be
offered with a front-end sales charge, as such term is defined in Rule 2830 of
the Conduct Rules of the National Association of Securities Dealers, Inc. The
amount of the sales charge on Class A shares is set forth at Exhibit II. Class
A shares shall be subject to a Distribution Plan adopted pursuant to Rule 12b-1
under the 1940 Act. The amount of the Distribution Plan expenses for Class A
shares, as set forth at Exhibit II, are used to pay the Fund's principal
underwriter for distributing and or providing services to the Fund's Class A
shares. This amount includes a service fee at the annual rate of .25 of 1% of
the value of the average daily net assets of Class A.
Class B shares shall be offered with a contingent deferred sales charge
("CDSC") and no front-end sales charge. The amount of the CDSC on Class B shares
is set forth at Exhibit II. Class B shares shall be subject to a Distribution
Plan adopted pursuant to Rule 12b-1 under the 1940 Act. The amount of the
Distribution Plan expenses for Class B shares, as set forth at Exhibit II, are
used to pay each Fund's principal underwriter for distributing and or providing
services to the Fund's Class B shares. This amount includes a service fee at the
annual rate of .25 of 1% of the value of the average daily net assets of Class
B.
Class C shares shall not be subject to a front-end sales charge, but shall
be subject to a 1.00% CDSC if the
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<PAGE>
shares are redeemed within one year of purchase. Class C shares shall be subject
to a Distribution Plan adopted pursuant to Rule 12b-1 under the 1940 Act. The
amount of the Distribution Plan expenses for Class C shares are set forth at
Exhibit II. The Class C Distribution Plan pays each applicable Fund's principal
underwriter for distributing and or providing services to such Fund's Class C
shares. This amount includes a service fee at the annual rate of .25 of 1% of
the value of the average daily net assets of Class C.
Class I and Class O shares shall be subject to neither a front-end sales
charge, nor a CDSC, nor are they subject to a Distribution Plan adopted pursuant
to Rule 12b-1 under the 1940 Act.
5. EXPENSE ALLOCATION. The following expenses shall be allocated, to the
extent practicable, on a Class-by-Class basis: (a) Distribution Plan fees; (b)
transfer agent fees; (c) administrative service fees; (d) printing and postage
expenses payable by a Fund relating to preparing and distributing materials,
such as proxies, reports and prospectuses to current shareholders of a specific
class; (e) class specific state notification fees; (f) class specific litigation
or other legal expenses; (g) certain class specific reimbursement from the
Advisor; and (h) certain class specific contract services (e.g., proxy
solicitation).
6. CONVERSION FEATURES. Class B shares shall be subject to an automatic
conversion feature into Class A shares after they have been held for that number
of years set forth in Exhibit II. Class A, Class C ,Class I, and Class O are not
subject to automatic conversion.
7. EXCHANGE PRIVILEGES. Class A shares shall be exchangeable only for:
(a) Class A shares of other funds managed or administered by the Calvert Group;
(b) shares of funds managed or administered by the Calvert Group which do not
have separate share classes; and (c) shares of certain other funds specified
from time to time.
Class B shares shall be exchangeable only for: (a) Class B shares of other
funds managed or administered by the Calvert Group; (b) Class A shares of other
funds managed or administered by the Calvert Group, if the front-end load on the
Class A shares is paid at the time of the exchange; and (c) shares of certain
other funds specified from time to time.
Class C shares shall be exchangeable only for: (a) Class C shares of other
funds managed or administered by the Calvert Group and Class B shares of Calvert
First Government Money Market Fund; (b) Class A shares of other funds managed or
administered by the Calvert Group, if the front-end load on the Class A shares
is paid at the time of the exchange; and (c) shares of certain other funds
specified from time to time.
Class I shares shall be exchangeable only for: (a) Class I shares of other
funds managed or administered by the Calvert Group; (b) Class A shares of other
funds managed or administered by the Calvert Group, if the front-end load on the
Class A shares is paid at the time of the exchange; and (c) shares of certain
other funds specified from time to time.
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<PAGE>
Exhibit I
The Calvert Fund
Calvert Tax-Free Reserves
Calvert Municipal Fund
Calvert Social Investment Fund
Calvert World Values Fund
Calvert New World Fund
First Variable Rate Fund
-3-
<PAGE>
Exhibit II
CALVERT SOCIAL INVESTMENT FUND (CSIF)
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
CSIF Managed Growth 4.75% 0.35% 1.00%
CSIF Equity 4.75% 0.35% 1.00%
CSIF Managed Index 4.75% 0.25% 1.00%
CSIF Bond 3.75% 0.35% 1.00%
</TABLE>
<TABLE>
<CAPTION>
Class B
Managed Growth,
Equity, and Maximum
Contingent Deferred Sales Charge Managed Index Bond 12b-1 Fee
<S> <C> <C> <C>
Shares held less than one year after purchase 5% 4% 1.00%
More than one year but less than two 4% 3%
More than two years but less than three 4% 2%
More than three years but less than four 3% 1%
More than four years but less than five 2%
More than five years but less than six 1%
Converts to Class A after 8 yrs. 6yrs.
</TABLE>
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<PAGE>
Exhibit II
CALVERT TAX-FREE RESERVES (CTFR)
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
CTFR Long-Term 3.75% 0.35% 1.00%
CTFR Vermont 3.75% N/A 1.00%
<CAPTION>
Class B
Long-Term and Maximum
Contingent Deferred Sales Charge Vermont 12b-1 Fee
<S> <C> <C>
Shares held less than one year after purchase 4% 1.00%
More than one year but less than two 3%
More than two years but less than three 2%
More than three years but less than four 1%
Converts to Class A after 6yrs.
</TABLE>
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<PAGE>
Exhibit II
CALVERT MUNICIPAL FUND
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
National Intermediate 2.75% 0.25% N/A
California Intermediate 2.75% 0.25% N/A
Maryland Intermediate 2.75% 0.25% N/A
Virginia Intermediate 2.75% 0.25% N/A
<CAPTION>
Class B
Maximum
Contingent Deferred Sales Charge CMF 12b-1 Fee
<S> <C> <C>
Shares held less than one year after purchase 3% 1.00%
More than one year but less than two 2%
More than two years but less than three 2%
More than three years but less than four 1%
Converts to Class A after 4 yrs.
</TABLE>
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<PAGE>
Exhibit II
THE CALVERT FUND
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
New Vision Small Cap 4.75% 0.25% 1.00%
Calvert Income Fund 3.75% 0.50% 1.00%
<CAPTION>
Class B
Maximum
Contingent Deferred Sales Charge New Vision Income 12b-1 Fee
<S> <C> <C> <C>
Shares held less than one year 5% 4% 1.00%
More than one year but less than two 4% 3%
More than two years but less than three 4% 2%
More than three years but less than four 3% 1%
More than four years but less than five 2%
More than five years but less than six 1%
Converts to Class A after 8 yrs. 6 yrs.
</TABLE>
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<PAGE>
Exhibit II
CALVERT WORLD VALUES FUND
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
International Equity 4.75% 0.35% 1.00%
Capital Accumulation 4.75% 0.35% 1.00%
<CAPTION>
Class B
Maximum
Contingent Deferred Sales Charge CWVF 12b-1 Fee
<S> <C> <C>
Shares held less than one year after purchase 5% 1.00%
More than one year but less than two 4%
More than two years but less than three 4%
More than three years but less than four 3%
More than four years but less than five 2%
More than five years but less than six 1%
Converts to Class A after 8 yrs.
</TABLE>
February 1998
Lgl Shr/Agreements/New UW/Rule 18f-3 Plan
-8-
<PAGE>
Exhibit II
CALVERT NEW WORLD FUND
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
Calvert New Africa 4.75% 0.25% 1.00%
<CAPTION>
Class B
Maximum
Contingent Deferred Sales Charge New Africa 12b-1 Fee
<S> <C> <C>
Shares held less than one year after purchase 5% 1.00%
More than one year but less than two 4%
More than two years but less than three 4%
More than three years but less than four 3%
More than four years but less than five 2%
More than five years but less than six 1%
Converts to Class A after 8 yrs.
</TABLE>
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<PAGE>
Exhibit II
FIRST VARIABLE RATE FUND
<TABLE>
<CAPTION>
Maximum Class A Maximum Maximum
Front-End Sales Class A Class C
Charge 12b-1 Fee 12b-1 Fee
<S> <C> <C> <C>
First Gov. Money Market N/A N/A N/A
<CAPTION>
Class B
Maximum
Contingent Deferred Sales Charge 12b-1 Fee
<S> <C>
CDSC of original Class B Fund purchased is applied upon
redemption from Class B of First Government Money Market 1.00%
</TABLE>
Conversion period of original Class B Fund purchased is applied.
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