The Crabbe Huson Special Fund, Inc.
(the "Special Fund")
The Crabbe Huson Real Estate Investment Fund, Inc.
(the "Real Estate Fund")
The Crabbe Huson Equity Fund, Inc.
(the "Equity Fund")
The Crabbe Huson Asset Allocation Fund, Inc.
(the "Asset Allocation Fund")
The Oregon Municipal Bond Fund, Inc.
The Crabbe Huson Income Fund, Inc.
The Crabbe Huson U.S. Government Income Fund, Inc.
The Crabbe Huson U.S. Government Money Market Fund, Inc.
(collectively, the "Funds")
November 29, 1995
Portfolio Managers
The Crabbe Huson Group, Inc. (the "Adviser") has added
the following portfolio managers to the Equity, Asset Allocation
and Special Fund.
Marian Kessler and Robert W. Anton have joined the
team of Richard S. Huson and John E. Maack, Jr. to manage the
Equity and Asset Allocation Funds. Ms. Kessler joined the
Adviser in August, 1995. From September, 1993 until July, 1995,
Ms. Kessler was a portfolio manager with Safeco Asset
Management. Between August, 1986 and June, 1993, Ms. Kessler
was an equity analyst for IDS Financial Services. She brings
more than 10 years of experience to the team. Mr. Anton joined
the Adviser in June, 1995. Prior to joining the Adviser,
Mr. Anton served seven years as Chief Investment Officer,
Portfolio Manager at Financial Aims Corporation. Mr. Huson will
continue to coordinate the Team.
Mr. John W. Johnson joined the Adviser in May, 1995 to
assist James E. Crabbe in management of the Special Fund
Portfolio. Prior to joining the Adviser, Mr. Johnson was a
private investment banker from November, 1991, to May, 1995.
Between August, 1988, and November, 1991, Mr. Johnson was
Director of Equity Investments for Kennedy Associates.
Information concerning Mr. Crabbe may be found under "MANAGEMENT
OF THE FUNDS" in the Prospectus. Mr. Crabbe will continue to
coordinate the team.
Subadvisory Contract
On September 6, 1995, the shareholders of the Real
Estate Fund approved a Subadvisory Agreement among the Adviser,
the Real Estate Fund and Aldrich, Eastman & Waltch, L.P.
("AEW"). Pursuant to the Subadvisory Agreement, AEW will be
responsible for the day-to-day investment management of the Real
Estate Fund, subject to the overall supervision of the Adviser
and the Real Estate Fund's Board of Directors.
AEW is a registered investment adviser founded in
1981. AEW is dedicated exclusively to building and managing
real estate investment portfolio for institutional investors.
AEW currently manages approximately $4.4 billion in assets.
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The general partner of AEW is AEW Holdings L.P. ("AEW
Holdings"). The general partner of AEW Holdings is Aldrich,
Eastman & Waltch, Inc. ("AEW INC"). The Shareholders of AEW
INC include certain current and former executive employees of
AEW. AEW's business address is 225 Franklin Street, Boston, MA
02110-2803.
As compensation for its services, the Adviser will pay
to AEW, at the end of each calendar month, a fee equal to the
greater of (a) 37.5% of one percent of the average daily net
asset value of the Fund (the "ADNAV") up to the first $100
million of net asset value, 31.88% of one percent of the ADNAV
for the next $400 million of net asset value, and 22.5% of one
percent of the ADNAV for amounts in excess of $500 million of
net asset value, or (b) 50% of the actual fees paid by the Fund
to the Adviser. The fee paid by the Adviser will not increase
any of the fees incurred by the Fund, and will not affect the
Adviser's agreement, terminable on 30 days' notice, to waive
certain of its fees and/or reimburse expenses.
Administration Agreement
The Funds have retained State Street Bank and Trust
Company ("State Street") to provide administrative services to
the Fund. Such services relate to accounting, compliance and
operations. For such services, the Funds have agreed to pay
State Street a fee based on the total assets managed by the
Adviser. The fee shall be as follows: first $500 million
managed by Adviser - .06%; next $500 million - .03%; thereafter
- - .01%. Each Fund will pay its pro rata share of such fee.
Amendment to Distribution Plans
The directors of the Funds approved an amendment to
the distribution plans ("Plans") adopted pursuant to rule 12b-1
under the 1940 Act that permits the Funds to distribute a
portion of the funds available under the Plans directly to
broker dealers, investment advisers and others that actively
promote the sale of Fund shares. The amendment does not
increase the total amounts that may be paid under the Plans.
Purchases and Redemptions
Signature guarantees are now required with respect to
redemptions by mail if the proceeds (a) exceed $15,000, (b)
result from a 100% redemption of the account, (c) are to be paid
to a person other than the record owner, (d) are to be sent to
an address other than the address on the Transfer Agent's
records, or (e) are to be paid to a corporation, partnership,
trust or fiduciary. Redemptions processed through Crabbe Huson
Instant Access may not exceed $100,000 per day.
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Subsequent investments may also be made through Crabbe
Huson Instant Access. An investor who desires to purchase
additional shares may call 1-800-235-2442 and purchase shares
using the Instant Access Automated Information Service. The
purchases will be recorded the next business day. Only
investors who have provided current ACH bank information and
authorizations can use this service. For information or
application forms, call 1 (800) 235-2442. The Instant Access
System also provides current account information, and permits
redemptions and exchanges over the telephone.
