Registration No. 2-38679
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. ........ [ ]
Post-Effective Amendment No. . 36... [ X ]
REGISTRATION STATEMENT UNDER THE [ ]
INVESTMENT COMPANY ACT OF 1940
Amendment No. ...36.... [ X ]
Pax World Fund, Incorporated
[GRAPHIC OMITTED]
(Exact Name of Registrant as Specified in Charter)
224 State Street, Portsmouth, N.H. 03801
[GRAPHIC OMITTED]
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (603) 431-8022
Luther E. Tyson, President, 224 State Street, Portsmouth, N.H. 03801
[GRAPHIC OMITTED]
(Name and Address of Agent for Service)
Approximate date of proposed public offering: April 22, 1996
[GRAPHIC OMITTED]
It is proposed that this filing will become effective:
[ ]Immediately upon filing pursuant to paragraph (b) of Rule 485; or
[ ] 60 days after filing pursuant to paragraph (a); or
[ X ] On April 22, 1996, pursuant to paragraph (b); or
[ ] On ,pursuant to paragraph (a) of Rule 485.
Registrant, pursuant to Investment Company Act Rule 24f-2, has elected to
register under the Securities Act of 1933, an indefinite number of shares of its
$1 par value Common Stock.
TABLE OF CONTENTS
N-1A
Part
A...................................................................Prospectus
Part
B............................................Statementof Additional Information
Part
C...........................................................Other Information
Signature Page
PAX WORLD FUND
INCORPORATED
PART A
PROSPECTUS
PROSPECTUS DATED APRIL 22,1996
PAX WORLD FUND
INCORPORATED
A No-Load Balanced Fund
224 State Street, Portsmouth, New Hampshire 03801
For shareholder account information: (800) 372-7827
Portsmouth, N.H. office: (603) 431-8022
Portsmouth, N.H. office: 1 -800-767-1729
The Prospectus sets forth concisely information about the Fund that a
prospective investor ought to know before investing. The Prospectus should be
retained for future reference. A copy of the Annual Report of the Fund
containing a narrative discussion and line chart of Fund performance may be
obtained without charge by writing the Fund or telephoning any of the above
numbers. Additional information about the Fund has been filed with the
Securities and Exchange Commission and is available by writing to the Fund at
the above address without charge. The Statement of Additional Information is
also dated April 22, 1996.
The Fund seeks investments in companies producing life supportive goods and
services and that are not to any degree engaged in manufacturing defense or
weapons-related products. It excludes securities in companies engaged in
military activities, those companies appearing on the Department of Defense's
100 largest contractors list,and other companies contracting with
the Defense Department if 5% or more of gross sales were derived from such
contracts. See page 3, "Social Criteria of Portfolio."
The investment objectives of the Fund are primarily to provide its
shareholders a diversified holding of securities of companies which offer
primarily income and conservation of principal and secondarily possible
long-term growth of capital through investment in common and preferred stocks
and debt securities.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION NOR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Some prospective purchasers of Fund shares may be effecting transactions
through a securities broker-dealer which may result in a transaction fee by such
broker-dealer. Such fee would not be incurred if the purchase transaction is
made directly with the Fund.
TABLE OF CONTENTS
Page
Synopsis
...........................................................................3
Financial Highlights.......................................................5
General Description of the Fund............................................6
Management of the Fund.....................................................6
Investment Adviser.........................................................8
Transfer and Dividend Paying Agent.........................................8
Fund Annual
Expenses...................................................................8
Brokerage Commission Practices.............................................8
Capital Stock and Other Matters............................................9
Shareholder Distributions..................................................9
Tax Status.................................................................9
How to Purchase Shares....................................................10
Automatic Investment Plan.................................................11
Shareholder Accounts......................................................11
Retirement and Other Programs.............................................11
Distribution Expense Plan.................................................11
How to Redeem Shares......................................................12
Voluntary Income Contribution to Pax World Service........................13
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<CAPTION>
<S> <C>
Maximum Sales Load Imposed on Purchases (as a percentage of offering price)...0%
Maximum Sales Load Imposed on Reinvested Dividends
(as a percentage of offering price)...........................................0%
Deferred Sales Load (as a percentage of original purchase price or redemption
proceeds, as
applicable)...................................................................0%
Redemption Fees (as a percentage of amount redeemed, if applicable)
..............................................................................0%
Exchange Fee Annual Fund Operating Expenses
(as a percentage of average net assets).......................................0%
Management
Fee........................................................................0.51%
12b-1
Fees.......................................................................0.12%
Other
Expenses...................................................................0.34%
Total Fund Operating Expenses
...........................................................................0.97%
Example
<S> <C> <C> <C> <C>
1 Year 3 Years 5 Years 10 Years
You would pay the following
expenses on a $1,000
investment, assuming (1 ) 5%
annual return and
(2) redemption at the end of
each time period ..............$9.70 $30.27 $52.52 $116.36
</TABLE>
The purpose of this table is to assist the investor in understanding the various
costs and expenses that an investor in the fund will bear directly or
indirectly. (See page 11 for information on 1 2b-1 Plan )
The 5% return factor in the example is a required amount by government
regulation and does not represent the actual average return made by Pax World
Fund over the past ten years.
2
SYNOPSIS
Pax World Fund, Incorporated (Fund) is an open-end, diversified, no-load
mutual fund organized under Delaware law in February 1970. The Fund endeavors
through its investment objectives to make a contribution to world peace through
investment in companies producing life-supportive goods and services. Thus the
Fund has adopted the name Pax World to denote this endeavor The Fund portfolio
will consist primarily of companies located in the United States.
The policy of this mutual fund is to invest in securities of companies
whose business is essentially directed toward non-military and life-supportive
activities. For example, the Fund seeks to invest in such industries as health
care, education, housing, food, retail, clothing, pollution control, leisure,
utilities and others. The Fund offers both individual and institutional
investors the opportunity to participate in the benefits of owning a diversified
portfolio.
SIGNIFICANT FEATURES
1. NO SALES CHARGE. There is no sales charge of
any kind when you purchase shares of the Fund. This type of investment company
is referred to as a "no-load" fund, and the net asset value of the shares is
quoted daily in the financial pages of most city newspapers, including the Wall
Street Journal
2 INVESTMENT OBJECTIVES. Investment objectives of the Fund are primarily to
provide its shareholders with a diversified holding of securities of companies
which offer primarily income and conservation of principal and secondarily
possible long-term growth of capital through investment in common and preferred
stocks and debt securities. The Fund attempts to maintain a balance of
investments with approximately 60% of its assets in common and preferred stocks
and 40% in bonds or debentures. Texas residents please see p. 14.
3. SOCIAL CRITERIA OF PORTFOLIO. The Fund seeks investments in companies that
are not to any degree engaged in manufacturing defense or weapons-related
products. The Fund excludes from its portfolio securities of companies: (1)
engaged in military activities, defined as follows: (a) appearing on the
Department of Defense's 100 largest contractors list and (b) other companies
contracting with the Department of Defense if 5% or more of their gross sales
were derived from such contracts; (2) engaged in liquor, tobacco, and gambling
industries. In addition, the Fund will seek out companies with fair employment
and pollution control policies and practices and fair employment practices
consistent with the U.S. Disabilities Act,, and invest in some international
development. To date, the latter has been limited to bonds of the International
Bank for Reconstruction and Development. See "General Description of the Fund."
4. OFFERING PRICE. The shares of common stock ($1 par value) are offered at
net asset value. Minimum initial investment is $250, with subsequent
investments at $50. See "How to Purchase Shares."
5. PROFESSIONALMANAGEMET In order to properly supervise a securities portfolio
containing the limitations described above, care must be exercised to
continuously monitor developments of the companies whose securities are included
in the portfolio. Developments and trends in the economy and financial markets
are also considered, and the screening of many securities is required to
implement the investment philosophy of the Fund. The officers of the Fund are
responsible for the day-to-day operations and the directors for the general
policy of the Fund. Anthony S. Brown, a graduate of the Wharton School of
Finance, has acted as chairperson of the investment committee since the Fund's
inception to the present time.
Certain officers/directors of the Fund are officers/directors and
stockholders of the Adviser. See "Investment Adviser."
3
6. DIVERSIFICATION. All investments entail some degree of risk, but
risk can be significantly reduced by diversifying holdings to minimize the
impact of the portfolio of any single investment. By pooling the funds of
many investors with similar investment objectives, the Fund can give each of
them an opportunity to benefit from a broadly diversified portfolio, a
benefit ordinarily available only to investors with substantial capital to
invest. See "General Description of the Fund."
7. NO REDEMPTION CHARGE. Shares of the Fund are redeemable at net asset
value upon request and without charge.
Payment for shares redeemed is made by the Fund within seven days after the
date on which the request in proper form is received. See "How to Redeem
Shares."
8. AUTOMATIC REINVESTMENT. The Fund's automatic reinvestment program
provides shareholders with a convenient method of reinvesting any income or
capital gains distributions in additional shares of the Fund at net asset
value. See "Shareholder Distributions."
9. ADVISER COMPENSATION. Computed daily and paid monthly, the fee (on an annual
basis) is 3/4 of 1 % of average net assets on the first $25,000,000 and 1 /2 of
1 % of average net assets in excess of that figure, payable to Pax World
Management Corp. Fund expenses (other than interest, brokerage commissions,
fees, taxes and distribution expenses under the Rule 12b-1 Plan) over 1 ~/~% of
average net assets are reimbursed by the Adviser.
10. RETIREMENT AND OTHER PROGRAMS. The Fund offers investors special programs,
including automatic reinvestment, voluntary withdrawal plan, group investment
plan, automatic monthly investment plan, and tax-sheltered retirement
plans such as IRAs, SEP-IRAs, and 403(b)s. See Retirement and Other Programs,
p. 11.
11. PAX WORLD SERVICE. Voluntary contributions may be made, by those with
regular accounts, to Pax World Service which provides financial support to
organizations and projects which encourage international understanding,
reconciliation, and development. See p.13.
12 CUSTODIAN BANK State Street Bank and Trust Company is the custodian bank.
13. TRANSFER AND DISBURSING AGENT. PFPC Inc. is the transfer and disbursing
agent.
14. AUDITORS. Pannell Kerr Forster, P.C., independent certified public
accountants, are the auditors of the Fund for the fiscal year ending December
31,1995. Shareholders are furnished annual reports of the Fund.
15. DISTRIBUTION Expense Plan. The Plan provides that the Fund may incur
distribution expenses of up to twenty-five hundredths of one percent (.25%) per
annum of its average daily net assets to finance activity which is primarily
intended to result in the sale of Fund shares. Rule 12b-1 fees paid during 1994
amounted to approximately $435,000. See "Distribution Expense Plan." This
Synopsis should be read in conjunction with the more detailed information in
this Prospectus.
Copies of the Annual Report of the Fund may be obtained upon
request at no charge.
PAX WORLD FUND, INCORPORATED
For further information write or call the Fund
224 State Street
Portsmouth, New Hampshire 03801
1 -800-767-1729
4
PAX WORLD FUND, INCORPORATED
FINANCIAL HIGHLIGHTS
1. PER SHARE COMPONENTS OF THE NET CHANGE DURING THE PERIOD IN NET ASSET VALUE
(BASED UPON AVERAGE NUMBER OF SHARES OUTSTANDING).
<TABLE>
<CAPTION>
Year Ended December 31
<S> <C> <C> <C> <C> <C>
1995 1994 1993 1992 1991
Net asset value, beginning of year ............. $ 13.39 $ 13.55 $ 14.27 $ 14.99 $ 13.97
INCOME FROM INVESTMENT OPERATIONS
Investment income net ................. .80 .49 .51 .64 .82
Realized and unrealized
gain (loss) on
investments - net ..................... 3.07 (.15) (.66) (.39) 2.17
Total from investment
operations ............................ 3.87 .34 (.15) .25 2.99
LESS DISTRIBUTIONS
Dividends from net
investment income ..................... .79(A) .50 .50 .67 .77
Distributions
from realized gains ................... .14(A) .07 .13 1.04
Tax return of capital ................. .17 .16
Total distributions ................... .93 .50 .57 .97 1.97
Net asset value,
end of year ........................... $ 16.33 $ 13.39 $ 13.55 $ 14.27 $ 14.99
2. TOTAL RETURN ....................... 29.19% 2.65% (1.05)% .6% 20.8%
3. RATIOS AND SUPPLEMENTAL DATA
Ratio of total expenses to
average net assets (B) ................ .97% .98% .94% 1.0% 1.2%
Ratio of investment
income - net to
average net assets .................... 3.44% 3.66% 3.63% 3.7% 5.1%
Portfolio turnover rate ............... 28.44% 25.45% 22.15% 17.4% 25.7%
Average commission
rate paid (C) ......................... $ .0714
Net assets, end
of year('000's) ....................... $ 476,976 $ 388,249 $ 462,762 $ 469,275 $ 270,488
Number of capital
shares outstanding,
end of year ('000's) 29,200 29,000 34,142 32,878 18,042
</TABLE>
<TABLE>
<CAPTION>
Year Ended December 31
1990 1989 1988 1987 1986
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year ................. $ 13.98 $ 11.92 $ 11.58 $13.19 $13.34
INCOME FROM INVESTMENT OPERATIONS
Investment income net ..................... .60 .61 .61 .55 .44
Realized and unrealized
gain (loss) on
investments - net ......................... .86 2.32 .71 (.15) .67
Total from investment
operations ................................ 1.46 2.93 1.32 .40 1.11
LESS DISTRIBUTIONS
Dividends from net
investment income ......................... .61 .62 .61 .75 .50
Distributions
from realized gains ....................... .84 .25 .37 1.24 .71
Tax return of capital ..................... .02 .02 .05
Total distributions ....................... 1.47 .87 .98 2.01 1.26
Net asset value,
end of year ............................... $ 13.97 $ 13.98 $ 11.92 $ 11.58 $ 13.19
2. TOTAL RETURN ........................... 10.5% 24.9% 11.5% 2.6% 8.5%
3. RATIOS AND SUPPLEMENTAL DATA
Ratio of total expenses to
average net assets (B) .................... 1.2% 1.1% 1.1% 1.1% 1.2%
Ratio of investment
income - net to
average net assets ........................ 5.4% 5.8% 5.0% 4.1% 3.2%
Portfolio turnover rate ................... 38.9% 37.4% 57.5% 123.9% 56.5%
Average commission
rate paid (C) .............................
Net assets, end
of year('000's) ........................... $ 119,831 $ 93,030 $ 73,650 $ 65,787 $ 53,802
Number of capital
shares outstanding,
end of year ('000's) 8,576 6,653 6,177 5,683 4,080
</TABLE>
(A) Reference is made to note A to the financial statements.
(B) In order to conform to current disclosure requirements, the 1995 ratio is
based upon total expenses, including the gross amount ot custodian fees (before
being reduced pursuant to an expense offset arrangement). The ratios for prior
years were based upon net expenses and are not required to be restarted.
(C) The 1995 average commission rate is presented to conform to current
disclosure requirements. This disclosure was not required in prior year and
has not been computed for the prior years.
GENERAL DESCRIPTION OF THE FUND
The Fund is a balanced fund and intends to invest about 60 percent of its
assets in common and preferred stock and/or securities convertible into common
stock and 40 percent in bonds or debentures which percentage may vary depending
on market conditions.
The Fund may not purchase the securities of any one issuer (except
government securities) if immediately after and as a result of such purchase (a)
the market value of the holdings of the Fund in the securities of such issuer
exceeds 5% of the market value of the Fund's total assets, or (b) the Fund owns
more than 10% of the outstanding voting securities or of any one class of
securities of such issuer.
The Fund's objectives and policies described below may be changed only with
a majority of outstanding voting securities which is defined as the vote of a
special or annual meeting of the stockholders duly called, (A) of 67% of the
voting securities present at such meetings if the holders of more than 50% of
the outstanding voting securities are present or represented by proxy or (B) of
more than 50% of the outstanding voting securities, whichever is less.
The investment objectives of the Fund are primarily to provide its
shareholders a diversified holding of securities of companies which offer
primarily income and conservation of principal and secondarily possible
long-term growth of capital through investment in common and preferred stocks
and debt securities. There can be no assurance that the Fund will, in fact,
achieve its objectives. The policy of the Fund is to exclude from its portfolio:
(1 ) securities of companies engaged in military activities as defined below;
(2) companies appearing on the Department of Defense's 100 largest contractors
list*;
(3) other companies contracting with the Department of Defense will not be
considered if 5 percent or more of their gross sales for their prior fiscal year
was derived from such contracts; (4) securities of companies of the liquor,
tobacco and gambling industries including their subsidiaries.
If a merger or acquisition causes a security in the portfolio to come
within the foregoing restrictions, the Fund will attempt to eliminate such
security over a six-month period.
The Fund will endeavor (but is not required to do so) to invest in
companies which have adopted and administer fair employment and pollution
control policies to the extent information reflecting such policies and
administrative practices is available to the Fund.
The Fund will seek investments in companies that produce life supportive
goods and services and are not to any degree engaged in manufacturing defense or
weapons-related products. By way of illustration, the Fund will invest in such
industries as housing, food, leisure time, education, retailing, pollution
control, health care, household appliances, publishing and building supplies,
among others.
If after the initial purchase by the Fund it is determined that the
company's activities fall within the exclusion described above, the securities
of such companies will be eliminated from '1e portfolio when a gain results from
the sale. In no event, however, will such security be retained longer than six
months from the time the Fund learns of the investment disqualification. This
requirement may cause the Fund to dispose of the security at a time when it may
be disadvantageous to do so.
MANAGEMENT OF THE FUND
The officers of the Fund are responsible for the day-to-day operations of
the Fund and the Directors for the general policy of the Fund. The Board of
Directors meets four times per year and reviews portfolio selections, bonding
requirements, declares dividends and reviews activities of the executive
officers. Such activities are consistent with their fiduciary obligations under
Delaware Corporation Law as Directors. *Copies may be obtained from the Office
of the Secretary, Department of Defense, Washington, D.C. 20310.
The following table reflects the name and address, position held with the Fund
and principal occupation
during the past five years for those persons who are the officers and directors
of the Fund.
<TABLE>
<CAPTION>
Name and Address Position with Fund Principal Occupation during past 5 years
<S> <C> <C>
*Luther E. Tyson, Ph.D. President and Director Sociologist, ethicist, and clergyman. From 1966-85
**69 Wentworth Lane (since inception) 1970 he served as Director of a Department of the Board
P.O. Box 351448 of Church and Society of The United Methodist
Palm Coast, FL 32135 Church.
*J. Elliott Corbett Ph.D. Vice President Social ethicist and clergyman. From 1961 to Decem-
**6006 Milo Drive and Director ber,1 980 he was a member of the staff of the United
Bethesda, MD 20816 (since inception) 1970 Methodist Board of Church and Society He served as
President of Pax World Foundation from 1970-1990.
*Anthony S. Brown Vice President, 1970 to present, Treasurer and Director Pax World
**209 Lafayette Road Treasurer and Director Management Corp. (adviser to the Fund); portfolio
Portsmouth,NH03801 (since inception)1970 manager of the Fund; from July 1982 to Decem-
(Portfolio Manager) ber 1990, registered representative with Fahnestock
& Co., members of the New York Stock
Exchange and from August 1987 to
December 1990, a Vice President and
office manager; a tru Piscataqua Savings Bank, Portsmouth,
NH, since July 1990 and Chairman of the Board
since August 1992
C. Lloyd Bailey Director An attorney; he served during 1959-1979 as Exec-
1216 Foulkeways (since inception) 1970 utive Director of the United States Committee for
Gwynedd, PA 19436 UNICEF and from 1980-81 as President of that
Committee. Since 1981 to the present he has served
as a consultant to that Committee.
Ralph M. Hayward Director Retired in 1971 after 31 years of employment
57 Barrell Lane (since 1978) with Merck and Co., Rahway, New Jersey
where he held York Harbor, ME 03911 various executive
positions. He is currently President
and principal stockholder of Fisher-James Company,
Inc.of Biddeford and Sanford, Maine, an office supply and
equipment dealer.
Joy L. Liechty Director 1989 to present, Client and Sales Advocate of Men-
919 South Seventh St. (since 1991) nonite Mutual Aid Association; from 1980-89
Goshen, IN 46526 Manager of Client Services of Mennonite Mutual Aid
Association
Raymond L. Mannix Director Certified public accountant, and Professor
71 Richmond Road Emeritus(since inception) 1970 of Boston University
Belmont, MA 02178 where he served as a Professor in the College of
Business Administration for more than forty years
Sanford C Sherman Director Presient/CEO, Piscataqua Savings Bank
91 Hillside Drive (since Dec., 1992) Portsmouth, NH, April 1981 to date, Twenty-
Portsmouth,NH 03801 one years prior thereto, he held various other
positions with the bank including Treasureer and
Vice President; he also served the bank as a
Trustee for twenty years.
Esther J. Walls Director Director From 1974-1988, Associate Director of Libraries,
160 West End Avenue (since 1981) State University of New York, Stony Brook, L.I.,
Apt.29J New York, Currently, library consultant
New York, NY 10023
William M. Prifti Secretary Attorney, engaged in the private practice of the law
Suite 204,220 Broadway and General Counsel since 1968.
Lynnfield, MA 01940
</TABLE>
Designates a Director or Officer who is an interested person as defined by the
Investment Company Act of 1940.
**Designates a member of the Executive Committee and Investment Committee
Members of the Audit Commune: Messrs. Mannix and Hayward
INVESTMENT ADVISER
The Investment Adviser is Pax World Management Corp. also located
at 224 State Street, Portsmouth, N.H.03801. The Adviser was organized
in 1970 and has from that time to the present had the Fund as its only
client. The Adviser makes recommendations with respect to the investments
and investment policies of the Fund. Except for the Secretary of the Adviser,
the officers and directors of the Adviser consist of the officers of the
Fund, namely Luther E. Tyson, J. Elliott Corbett, and Anthony S. Brown, along
with Paul V. Brown, Jr., who is not an officer or director of the Fund. The
Adviser received compensation of 3/4 of 1 % of average net assets on the first
$25 million and 1 /2 of 1 % of average net assets in excess of that figure for
the fiscal year.
TRANSFER AND DIVIDEND PAYING AGENT
The transfer agent and dividend paying agent is PFPC Inc., 400 Bellevue Parkway,
Wilmington, DE 19809. Shareholder inquiries relating to a shareholder account
should be directed to Pax World Fund, Inc., c/o PFPC Inc., P.O. Box 8950,
Wilmington, DE 19899.
FUND ANNUAL EXPENSES
For the fiscal year ended December 31,1995, total expenses incurred by the
Fund amounted to %, or less than 1 %, of its average net assets which
includes expenses pursuant to the 12b-1 plan.
BROKERAGE COMMISSION PRACTICES
Brokerage dealers involved in the execution of portfolio transactions on
behalf of the Fund are selected on the basis of their professional capability
and quality of their services. In selecting such dealers the Fund considers
various relevant factors, including, but not limited to, the efficiency of
execution of orders,
settlement capability, quality and extent of research and the reasonableness of
any mark-ups or commissions. Any allocation for research services is arbitrary
and not through any prearrangement.
CAPITAL STOCK AND OTHER MATTERS
The Fund, organized in February 1970, is authorized by its Articles of
Incorporation as amended by the stockholders on June 10, 1993 and pursuant to
Delaware law to issue 75,000,000 shares of common stock of a par value of $1 per
share. Such shares have no preference, pre-emptive, conversion or exchange
rights except as outlined in the prospectus. The stock offered hereby will, in
the opinion of General Counsel, when issued and sold, be fully paid and
nonassessable. Each share has one vote in corporate matters (fractional shares
have proportionate voting rights), are freely transferable and are entitled to
dividends as determined by the Board of Directors and in liquidation of the Fund
are entitled to receive the net assets of the Fund. The shares have
noncumulative voting rights, which means that the holders of more than 50
percent of the shares voting for the election of directors can elect 100 percent
of the directors if they choose to do so, and, in such event, the holder of the
remaining less than 50 percent of the shares voting will not be able to elect
any directors.
As of the date of the Prospectus, there are no persons owning 5% or more of
the outstanding stock of the Fund. All officers and Directors of the Fund as a
group own less than 1% of the outstanding stock of the Fund.
Luther E. Tyson (President of the Fund), J. Elliott Corbett
(Vice-President), and Anthony S. Brown (Vice-President and Treasurer)
may be considered controlling persons of the Fund within the meaning of
the securities laws.
SHAREHOLDER DISTRIBUTIONS
Shareholders of the Fund will automatically have reinvested all income
dividends and capital gains distributions, if any, in additional shares of the
Fund at net asset value unless the dividend paying agent is notified at least
ten days before the record date that the shareholder wishes to elect to:
(1 ) Receive income dividends in cash and capital gains distributions in
additional shares at net asset value, or (2) Receive all income dividends nd
capital gains distributions in cash. The Fund's policy is to distribute annually
to shareholders all, or substantially all, of its net investment income and net
realized capital gains, if any. Income payments are usually made during the
third and fourth quarters in each fiscal year. Any capital gains, likewise, are
usually paid during the fourth quarter.
TAX STATUS
The Fund qualifies for tax treatment as a "regulated investment company"
under subchapter M of the Internal Revenue Code. The Fund will distribute its
net income and gains to shareholders and such distributions have been generally
treated as taxable income since 1986. Shareholders not subject to tax on their
income will not be required to pay tax on amounts distributed to them. The Fund
will inform shareholders of the amount and nature of such income or gains.
The Fund is required by federal law to withhold 31% of income dividends and
capital gains distributions (if any) paid to certain accounts which have
not complied with Internal Revenue Service regulations. In connection with this
withholding requirement, a purchaser of Fund shares will be asked to certify on
our application that the Social Security or tax identification number provided
is correct and that a purchaser is not subject to 31% back-up withholding for
previous underreporting to the IRS.
HOW TO PURCHASE SHARES
The offering price of shares of the Fund will be the net asset value per
share next computed after receipt of the order. No sales charge or load will be
added to such asset value.
The net asset value of the Fund's shares is determined as of the close of
business of the New York Stock Exchange on each business day on which the
Exchange is open, by dividing the value of the Fund's securities, plus any cash
and other assets (including dividends accrued but not collected) less all
liabilities (including accrued expenses but excluding the capital and surplus),
by the number of shares outstanding.
In valuing the Fund's assets, a security listed on the NewYork Stock
Exchange is valued at its last sale price on that Exchange on the day as of
which assets are valued. Lacking any sales on the day, the security is valued at
the mean between the bid and asked price. Securities listed on other exchanges
are similarly valued, using quotations on which the security is traded most
extensively.
To open an account, a purchaser should fill out and sign "The New Account
Application" (see end of Prospectus) and send it and a check made payable to Pax
World Fund, Inc. in an amount of at least $250 to Pax World Fund, Inc., c/o PFPC
Inc., P.O. Box 8950, Wilmington, DE 19899. Once an account is opened, additional
shares may be purchased by sending a check for at least $50 to PFPC Inc. Full
and fractional shares will be purchased at the offering price in effect at the
close of business of the New York Stock Exchange on the day payment is received
by PFPC I nc. and the shares will be credited to the shareholder's account. If
the order is received after the close of business on the New York Stock Exchange
or on a day when the stock exchange is not open for business, the offering price
of the shares will be the price determined as of the close on the following
business day. A confirmation will be issued and mailed to the shareholder giving
the particulars of the purchase.
Subsequent purchases to existing shareholder accounts may also be made by
wiring an order to the PNC Bank. Prior to wiring funds, please notify
shareholder services by calling (800) 372-7827. The wire order must contain the
shareholder's account number and the full name(s). Prior to wiring funds, alert
the PNC Bank by calling (800) 372-7827. The wire order should be sent to:
PNC Bank
Philadelphia, PA
ABA 031-0000-53
Pax World Fund, Inc.
Credit A/C# 510-077-1
Shareholder Account Number and Full Name(s)
Wire orders received by the PNC Bank will be executed at the Fund's net asset
value per share as next determined after receipt of the wired funds.
Foreign investors are advised to send checks for subscriptions to
eliminate any regulatory problems resulting from late payment. A certified check
is not necessary but checks must be collectible at full face value in United
States funds (that is, the checks should be converted to U.S. funds before
transmittal; checks not so converted will be returned by the Fund).
Income dividends and capital gains distributions, if any, will be
reinvested at net asset value prevailing at the close of business on the
ax-dividend date in additional full and fractional shares unless and until the
shareholder notifies the transfer agent in writing prior to such record date
that he/she elects to receive either dividends or both income dividends and
capital gains distributions together in cash. Stock certificates will not be
physically issued on reinvestment of such dividends and distributions but a
record of the shares purchased will be added to the shareholder's account and a
confirmation of such reinvestment will be sent to the shareholder by the
transfer agent.
AUTOMATIC INVESTMENT PLAN
Shareholders may also arrange for a systematic monthly investment ($50
minimum) through participation in the Fund's Automatic Investment Plan. After
the shareholder gives the Fund proper authorization, the shareholder's bank
account will be debited to purchase shares in the Fund. A confirmation will be
sent from the Fund for every transaction and a debit will appear on the
shareholders' bank statement. The Pax World Automatic Investment Plan, in
addition to the convenience of investing regularly, enables the shareholder to
practice "dollar cost averaging" as an investment strategy.
SHAREHOLDER ACCOUNTS
As a convenience to shareholders, the Fund will not ordinarily issue
certificates representing shares of its stock. The shares will be held on
deposit for the shareholders by PFPC Inc. which will send each shareholder an
up-to-date confirmation and statement of his/her account. Certificates are, of
course, available at any time on written request. Evidence of ownership of
shares in the Fund is the record of shares held in the stockholder's account in
the books of PFPC Inc. This amount will be confirmed to the investor each time
there is a change in his/ her account or any time upon his/ her request. Such a
shareholder has all the rights of other shareholders with respect to the shares
held in his/her account and does not risk the loss of stock certificates which
may be costly and time-consuming to replace.
RETIREMENT AND OTHER PROGRAMS
The Fund has the following special purchase plans and information regarding
each may be obtained by writing directly to the Fund at 224 State Street,
Portsmouth, NH 03801. Self-Employed Retirement Plans (IRAs and IRA-SEPS)
Voluntary Withdrawal Plan ($10,000 minimum investment) Voluntary Reinvestment
Plan (of dividends and capital gains) Group Investments (10 or more
persons--group investment minimum $1,000) Section 403(b) Retirement Plans
Automatic Investment Plan Uniform Gifts to Minors
DISTRIBUTION EXPENSE PLAN
The stockholders at the annual meeting on June 21, 1984, approved a
distribution expense plan pursuant to Rule 12b-1 under the Investment Company
Act of 1940.
The Plan provides that the Fund may incur distribution expenses of up to
twenty-five one hundredths of one percent (.25%) per annum of its average daily
net assets to finance activity which is primarily intended to result in the sale
of Fund shares. Such expenses include (but are not limited to) travel and
telephone expenses, preparation and distribution of sales literature and
advertising, compensation to be paid to and expenses to be incurred by officers,
directors and/or employees of the Fund, or other third parties for their
distributional service if sales of Fund shares are made by such third parties
during a fiscal year. During the 1995 fiscal year, amounts paid by the Fund
under the plan for clerical, advertising, printing, postage and sales expenses
(travel, telephone, and sales literature) totaled about $504,000. No amounts
were paid to officers and directors of the Fund in connection with the Plan
other than sales related travel expenses of $7,947 to officers.
HOW TO REDEEM SHARES
Payment of the net proceeds of redemption will be made by PFPC Inc.
The Fund will redeem out of assets legally available for such purposes all
or any part of the shares of capital stock standing in the name of any holder on
the books of the Fund but only at the net asset value of such shares (as herein
before defined) as of the close of business on the day on which written demand
is received by the Fund. If such demand is made on a day on which the NewYork
Stock Exchange is not open or after the Exchange is closed on any day, then the
redemptions shall be made at the net asset value determined as of the close of
business on the next succeeding day on which said Exchange is open. The value of
the shares on redemption may be more than the cost to the investor depending
upon the current value of the Fund's investment.
Requests for redemption must be made by written request of the
shareholder(s) directed to Pax World Fund, Inc., c/o PFPC Inc., P.O. Box 8950,
Wilmington, DE 19899 in proper form as described below.
A shareholder has the right to redeem all or any number of his/her shares
at any time by delivering his/her request with any certificates (if certificates
were requested at time of purchase) to PFPC, Inc.
Certificates and/or written requests will be considered in proper form only
if signed by the shareholder(s) exactly as the shares are registered and with
the signature(s) guaranteed by an "eligible" guarantor such as a U.S. commercial
bank or trust company located or having a correspondent bank in NewYork City, a
foreign bank with a U.S. commercial bank or trust company as correspondent,
savings associations, and credit unions as defined by the Federal Deposit
Insurance Act. Also included as an "eligible" guarantor are member firms of a
domestic stock exchange. You should verify with the institution that it is an
acceptable (eligible) guarantor prior to signing.
A notary public is not an acceptable guarantor.
Shareholders living abroad may acknowledge their signatures before a U.S.
Consular Officer. Military personnel may acknowledge their signatures before
officers authorized to take acknowledgments, e.g., leg officers and adjutants.
Improperly executed requests will not be recognized by the Fund and such
requests will be returned to the shareholder. The Fund will not mail redemption
proceeds until checks (including certified or cashier's checks) received for the
shares purchased have cleared.
Payment for the shares redeemed as aforesaid, shall be made by the Fund
within seven days after the date on which the request in proper form is
received.
Shareholders may use Pax World Fund's "Redemption Option" to redeem
shares up to $5,000 from accounts without a guaranteed signature.
For information and "Redemption Option" form, write to the Fund at 224
State Street, Portsmouth, NH 03801.
Telephone Redemption
The Fund permits individual shareholders (within a thirty day period) and a
representative of record to an account to redeem shares by telephone in amounts
up to $10,000 by calling PFPC Inc. at (800) 372-7827. Telephone redemptions must
be in amounts of $1,000 or more. Instructions must include your name and account
number.
This privilege only allows the check to be made payable to the owner(s) of
the account and may only be sent to the address of record. The request cannot be
honored if an address change has been made for the account within 60 days of the
telephone redemption request.
If there are multiple account owners, PFPC, Inc. may rely on the
instructions of only one owner. This account option is not available for
retirement account shares, shares represented by a certificate, or for newly
purchased (within the prior 15 days) shares. PFPC Inc. may record all calls.
The Fund reserves the right to refuse a telephone redemption if it believes
it advisable to do so. Neither the Fund nor PFPC, Inc. will be responsible for
the authenticity of redemption instructions received by telephone and believed
to be genuine and any loss therefrom will need be borne by the investor. During
periods of substantial economic or market change, telephone redemptions may be
difficult to complete.
Shares may always be redeemed by mailing the request as described above
under "How to Redeem Shares" if a shareholder is unable to contact PFPC, Inc. by
telephone.
VOLUNTARY INCOME CONTRIBUTION TO PAX WORLD SERVICE
To complement the Fund's objectives of investing in securities of companies
whose businesses are essentially of a non-military nature, the Pax World
Foundation was formed in 1970. Foundation Directors voted in July 1992 to change
the name from Pax World Foundation to Pax World Service. The Service provides
financial support to organizations and projects which encourage international
understanding, reconciliation and development. Overseas activities focus on
funding of projects in the areas of international development and education and
cultural exchange.
The officers and directors of the Service are:
Ms. Charolett Rhoads, President
Mr. Charles Demere, Chairperson and Director
Ms. Joan Baker, Vice Chairperson and Director
Dr. Robert McCan, Treasurer and Director
Mr. Tom C. Veblen, Secretary and Director
Mr. Edward Bartholomew, Director
Ms. Rita d'Escoto Clark, Director
Dr. J. Elliott Corbett, Director
Ms. Louise Diamond, Director
Mr. Joseph T. Eldridge, Director
Ms. Allison Herrick, Director
Mr. Samuel Hope, Director
Mr. Arthur Johnson, Director
Mr. Thomas L. Jones, Director
Mr. Donald A. Kruse, Director
Ms. Phoebe Lansdale, Director
Ms. Lucille (Sis) Levin, Director
Mr. Douglas Nelson, Director
Ms. Marian Osterweis, Director
Mr. Eduardo Perez, Director
Ms. Christine H. Tucker, Director
Mr. Wm. Harvey Wise, Director
No compensation will be paid by the Service directly or indirectly to the
officers and directors of the Service except for travel and other reasonable
fees for services rendered on behalf of projects undertaken by the Service.
Pax World Service initiates and supports projects that encourage
international understanding, reconciliation, and sustainable development on
behalf of world peace and the world's poor. o Agriculture and Retorestation.
Provides support for local people in Latin America working to increase crop
yields, construct irrigation systems, and combat deforestation. Pax's "Seeds
for Development" program distributes the high-protein Tepary bean seeds and
the fast-growing Giant Leucaena tree seeds, especially good for firewood,
throughout the globe.
o Friendship Tours. Builds bridges of understanding between peoples and
across national boundaries. Provides opportunity for U.S. citizens to
"step behind the headlines" on educational, fact-finding trips to
troubled regions of the world, and "hands-on" development trips to
Latin America.
o Water Purification. Developed a solar-powered water purification device
that provides safe drinking water in developing countries.
Fund shareholders may, at their election, make a voluntary contribution to
the Service of a percentage of their Fund income including capital gains.
Contributions to the Service are charitable contributions and such contributions
are tax deductible on the tax return of the contributor. Contributions to the
Service from shareholders of the Fund amounted to $ for the 1995 calendar year.
Fund shareholders who contribute to the Service receive an annual report of
the activities of the Service, which includes a financial statement. Commencing
in 1976 contributions have been made by shareholders of the Fund and by others
and annual reports have been issued to them accordingly.
A Fund shareholder may indicate on a special form the percentage of income
and/or capital gains the shareholder desires to be deducted for payment to the
Service. Shareholders will receive annually a confirmation for income tax
purposes indicating contributions made.
Additional information may be obtained by writing to Pax World Service,
1111 1 6th Street, N.W., Suite 120, Washington, D.C. 20036.
FOR TEXAS RESIDENTS ONLY
Investment objectives are hereby clarified and intended to be consistent
with Texas securities regulations. The Fund does not intend to make and has
not made investments in oil, gas and other mineral leases or
arbitrage transactions.
The Fund By-Laws contain an investment restriction which does not allow it
to purchase or sell real property but permits the Fund to make an investment in
readily marketable interests in real estate investment trusts or readily
marketable securities of companies which invest in real estate.
UNFOLD HERE FOR NEW ACCOUNT APPLICATION
NEW ACCOUNT INSTRUCTIONS
1. Type of Account. An account may be registered as only one of the following:
o Individual Supply the Social Security
o Joint Tenants Number of the registered
account owner who is to be taxed.
o A Custodial Account
under the Uniform Gifts
to Minors Account
o A Trust Supply the Taxpayer Identification
o A Corporation, Partnership, Number of the legal entity or
Organization, Fiduciary, organization that will report income
etc. and/or gains
Please check the box that corresponds to the type of account you are opening
and fill in the required information exactly as you wish it to appear on the
account.
TRADING AUTHORIZATION. If you desire a party other than the registered
account owner to have access to your account or transact business on your
account, you must file a Trading Authorization with Pax World Fund, Inc.
Other parties may include spouses, relatives, business officers, trust
officers, financial planners, tax advisors, etc. Call a Pax World Fund
service representative to ask for a "Trading Authorization."
Corporate Resolution. Corporations are required to furnish a "Corporate
Resolution" to authorize redemptions.
Call a Pax World Fund service representative to ask for a sample "Corporate
Resolution." Trusts, fiduciaries, partnerships, and other business
entities are required to furnish other documentation (e.g., a "Trust
Authorization") to authorize redemptions. Call a Pax World Fund service
representative to ask for the appropriate documentation.
2. YOUR MAILING ADDRESS. Please complete all information requested as it is
required to open your account.
3. YOUR INITIAL INVESTMENT. An initial investment of at least $250 is required
to open an account. Pax World Fund is a no-load fund and there is no sales
charge when making a purchase. Additional purchases must be at least in
the amount of $50.
4. RECEIVING YOUR DIVIDENDS AND CAPITAL GAINS. Check the option you
prefer for receiving your dividend and capital gain distributions. If you
do not select an option, all dividends and capital gains will be reinvested in
your account.
5. TELEPHONE REDEMPTION. Check both boxes if you wish the telephone
privilege for yourself and your representative of record.
6. AUTOMATIC INVESTMENT PLAN. With the Fund's Automatic Investment Plan, you
can have $50 or more automatically withdrawn from your bank account and
invested into your Pax World Fund, Inc. account monthly.
7. YOUR SIGNATURE(S). Please be sure to sign this application. If the account
is registered in the name of:
o an individual. The individual must sign.
o joint tenants. Both must sign.
o a custodian for a minor. The custodian must sign.
o a trustee or other fiduciary. The fiduciary(s) must sign and indicate
capacity.
o a corporation or other organization. An officer must sign and indicate
capacity. (If you are establishing a corporate account and you want to
authorize redemptions and add features, you must file a "Corporate Resolution"
with Pax World Fund as stipulated in Section 1 under "Corporate Resolution").
ANY QUESTIONS? Call a Pax World Fund service representative at 1-800-767-1729
for assistance.
Please return your completed application in the self-addressed envelope.
If envelope is missing, mail to:
Pax World Fund, Inc. c/o PFPC, Inc. P.O. Box 8950 Wilmington, DE 19899
Supply the Taxpayer Identification Number of the legal entity or organization
that will report income and/or gains.
New Account Application-Pax World Fund, Inc.
Do not use this application to open an IRA or other retirement account Please
call 1-800-767-1729 if you need a retirement application. Please mail to Pax
World Fund, Inc., c/o PFPC Inc., P.O. Box 8950, Wilmington, DE 19889
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1. Type of Account (check one) Individual Joint Tenants Gift/Transfer to a Minor
complete A only complete A&B Complete C only
Trust Corporation Partnership or Other Entity
Complete D only Complete E Only Complete E only
A
First Name, Middle Name, Last Name Social Security Number (Required to open your account)
Birthdate (mm dd yy)
B First Name, Middle Name, Last Name Social Security Number (Required to open your account)
birthdaye (mm dd yy)
Joint Tenants will have rights of survivorship unless otherwise specified.
C
Custodian's Name (only if permitted) as custodian for Minor's Name (only one permitted)
under the Uniform Gifts Uniform Gifts
State to Minors Act, or State to Minors Act. Monor's Social Security Number
Birthdate (mm dd yy)
D Name of Trustee Name of Trust
Name of Second Trustee (if any) Date of Trust (mm dd yy) Taxpayer identification #
(Required to open your account)
E
Name of Corporation or other entity. If other entity, please specify type in the space below
Taxpayer Identification Number Additional forms, such as Corporate resolution, are required to
authorize redemptions and add account features. See Application Business Type
Instructions, Section 1, and then call 1-800-767-1729 to request to
correct forms.
2 Your Mailing Address
Street address and Apartment number or Box number City State Zip Code
I am a citizen of U.S. Other Please specify country Area Code Day Phone Evening
Phone
3 Your Initial Investment (Minimum $250)
I have enclosed a check (do not send cash) made payable to Pax World Fund, Inc.
$ Amount ($250) minimum
4 Choose How You Wish to Receive Any Dividends and Capital Gains.
If not completed, Option A will be assigned.
A. I would like all dividends and capital gains reinvested in my account.
B. I would like all dividends and capital gains paid to me in cash.
C. I would like all dividends paid to me in cash and all capital gains reinvested in my account.
</TABLE>
5. Telephone Redemptions
I hereby authorize the Fund and transfer agent to honor telephone
instructions to redeem shares, when directed, and, as specified by transmitting
the proceeds to me at my address of record. I hereby ratify any such
instructions and agree to indemnify the Fund and its transfer agent from all
loss, liability, cost, damage and expense for acting upon such instructions. The
telephone redemption privilege (for an individual) is available once during a
thirty day period.
I want this privilege for MY REPRESENTATIVE OF RECORD to have authority
to give instructions for telephone redemptions. The name of my current
representative of record for third party administration is (name, Institution,
if any):
6. Automatic Monthly Investment
You can invest in Pax World Fund automatically each month by complete in the
following information and returning it to the Fund. You will receive a
confirmation of each transaction and the deduction from your bank account will
appear on you monthly bank statement.
Please invest the amount indicated below (minimum $50) in Pax World Fund.
Monthly investments of $
On the 20th day of every month beginning Month Year
Your automatic monthly investment program normally becomes active 20 business
days after you application is processed. IRA contributions made through the
automatic monthly investment program will be credited as a contribution for the
year in which the shares fare purchased. Please attach a voided unsigned check
or savings deposit slip for the bank account to be debited.
Bank Name
Name on Bank Account (Note: One common name must appear on both your Pax World
Fund account registration and bank account registration).
Your Bank Account Number
Your signature
Signature (If Joint Account)
This is a Checking Savings Account
As a convience to me, you are hereby requested and authorized to pay and charge
to my account debits drawn on my account by and payable to the order of Pax
World Fund, Inc. This authority is to remain in effect until revoked by me in
writing and, until you actually receive such notice, I agree you shall be fully
protected in honoring any such check. I further agree that if any such check is
dishonored, whether with or without cause and whether intentionally or
inadvertently, you shall be under no liability whatsoever. this option, if
exercised, shall become a part of the number account application and the terms,
representations and conditions thereof.
7 Your Signature
All registered owners or legal representative(s) must sign this section before
the Fund can open your account.
The undersigned warrant(s) that the undersigned has (Have) full authority and is
(are) of legal age to purchase shares of Pax World Fund, Inc. and has (have)
received and read a current Prospectus of the Fund and agree(s) to its terms.
The Fund and its Transfer Agent will not be liable for acting upon instructions
or inquires believed to be genuine.
Taxpayer Identification Number Certification: As required by Federal law, I/we
certify under penalties of perjury that (1) the Social Security Number or tax
Identification Number listed above is correct, and (2) I/WE HAVE NOT been
notified by the IRS that I/we am/are subject to backup withholding. It is
understood that failure to supply correct numbers above may subject me/us to a
penalty of $50 for each failure. Check this box if you ARE subject to 31% backup
withholding.
Signature Date
Signature Date
Dealer No. (if applicable)
PAX WORLD FUND, INCORPORATED
224 State Street, Portsmouth, New Hampshire 03801
1 -800-767-1 729
A NO-LOAD DIVERSIFIED FUND
Transfer and Disbursing Agent
PFPC, Inc.
Attention: Pax World Fund, Inc.
P.O. Box 8950
Wilmington, DE 19899
General Counsel
William M. Prifti, Esq.
220 Broadway
Suite 204
Lynnfield, Massachusetts 01940
Independent Auditors
Pannell Kerr Forster, P.C.
125 Summer Street
Boston, Massachusetts 02110
Investment Adviser
Pax World Management Corp.
224 State Street
Portsmouth, New Hampshire 03801
1 -800-767-1729
All account inquiries should be addressed to:
PFPC, Inc.
Attention: Pax World Fund, Inc.
P.O. Box 8950
Wilmington, DE 19899
For Shareholder Account Information
1 -800-372-7827
PAX WORLD FUND
INCORPORATED
PART B
STATEMENT OF ADDITIONAL INFORMATION
PART B
PAX WORLD FUND
Incorporated
224 State Street, Portsmouth, New Hampshire 03801
Telephone: (603) 431-8022
Telephone: 1 -800-767-1729
For shareholder account information: (800) 372-7827
Statement of Additional Information
This Statement of Additional Information is not a Prospectus and should be
read in conjunction with the Prospectus which may be obtained by writing the
Fund at its principal address: 224 State Street, Portsmouth, New Hampshire
03801.
A copy of the Annual Report of the Fund containing a narrative discussion
and line chart of Fund performance may be obtained without charge by writing the
Fund or telephoning any of the above numbers.
Statement of Additional Information
dated April 22, 1996 relates to the
Prospectus of the Fund dated April 22, 1996.
TABLE OF CONTENTS
PAGE
General Information and
History.........................................................See Prospectus,
"Synopsis."
Investment Objectives and Policies..............................3-B
See also Prospectus "Synopsis" and Genera Description of the Fund."
Management of the Fund..........................................4-B
Controlling Persons and
Principal Holders of Securities .................see Prospectus, "Capital Stock
and Other Matters."
Investment Advisory and Other Services. ........................5-B
Other Expense...................................................5-B
Custodian.......................................................6-B
Independent Auditors............................................6-B
Brokerage Allocation............................................6-B
Capital
Stock...........................................................6-B
Purchase, Redemption and Pricing of Securities Being Offered
...............................................................6-B
Tax Status.....................................................7-B
Financial Statements...........................................8-B
Independent Auditors' Report...................................15-B
2-B
INVESTMENT OBJECTIVES AND POLICIES
The policy of this mutual fund is to invest in securities of companies
whose business is essentially directed toward non-military and life-supportive
activities. For example, the Fund will seek to invest in such industries as
health care, education, pollution control, housing, food, retail, clothing and
leisure time. The Fund offers both individual and institutional investors the
opportunity to participate in the benefits of owning a diversified portfolio.
The Fund seeks income and conservation of principal and secondarily possible
long-term growth of capital through investment in common and preferred stocks
and debt securities.
The reader is referred to the Prospectus and the text appearing under the
caption "General Description of the Fund" for other information concerning
investment policies of the Fund. The following material may be considered
additional investment policies of the Fund and the restrictions concerning
investment policies are part of the articles of organization and the By-Laws
which may be altered or repealed only by a vote of a majority of the outstanding
voting securities. These restrictions state that the Fund may not: 1. Purchase
the securities of any one issuer (except government securities) if immediately
after and as a result
of such purchase (a) the market value of the holdings of the Fund in the
securities of such issuer exceeds five percent of the market value of the
Fund's total assets, or (b) the Fund owns more than ten percent of the
outstanding voting securities or of any one class of securities of such
issuer.
2. Purchase securities of other registered investment companies.
3. Concentrate more than 25% of its investments in one particular industry.
4. Purchase or sell real estate or other interests in real estate which are not
readily marketable.
5. Write, purchase or sell put and call options or combinations thereof.
6. Lend money or securities.
7. Purchase securities on margin or sell short or purchase or sell commodities.
8. Borrow money except that, as a temporary measure for extraordinary or
emergency purposes and not for investment purposes, the Fund may borrow from
banks up to five percent of its total assets taken at cost.
9. Mortgage or pledge security for indebtedness any securities owned or held by
the Fund except as stated in item 8, above.
10. Participate on a joint and several basis in any trading account in
securities.
11. Invest in companies for the purpose of exercising control of management.
12. Act as an underwriter of securities of other issuers, except that the Fund
may invest up to five percent of the value of its assets (at time of
investment) in portfolio securities which the Fund might not be free to
sell to the public without registration of such securities under the
Securities Act of 1933. The Fund's position in such restricted securities
may adversely affect the liquidity and marketability of such restricted
securities and the Fund may not be able to dispose of its holdings in these
securities at reasonable price levels.
13 Invest more than ten percent of the value of its assets in securities of
foreign issuers under circumstances that would subject it to federal interest
equalization tax or at prices that reflect such tax. (No such tax currently
in effect.)
14. Invest more than five percent of its total assets in securities of
companies having a record of less than three years continuous operation
except for those surviving a merger or consolidation. The Fund may, when
market conditions warrant, maintain a conservative position by retention of
cash and
investment in certain government or similar liquid securities (such as
commercial paper or certificates of deposit).
To the extent that information is obtainable, the Fund seeks to make
initial investments in companies located in foreign countries recognized by the
United States and which companies contribute to improving the standard of living
in those countries and whose products and services are consistent with the
Fund's objective of non-military investments. The Fund will not invest more than
10% of its assets in securities of foreign issuers. The Fund as a balanced fund
invests about 60 percent of its assets in common and preferred stock and/or
securities convertible into common stock and 40 percent in bonds or debentures
which percentage may vary depending on market conditions. It does not engage in
short-term trading and due to the investment objectives there will likely be
line portfolio turnover. While the rate of portfolio turnover will not be a
limiting factor when management deems changes appropriate, it is anticipated
that, given the Fund's investment objectives, its annual portfolio turnover rate
should not generally exceed 60 percent. A 100% turnover rate would occur, for
example, if all the securities in the Fund's portfolio were replaced in a period
of one year. Portfolio turnover for the fiscal years ended 1993 and 1994 and
1995 was 22.2% and 25.4%, and 28% respectively. A substantial portion of the
portfolio of the Fund consists of securities of companies listed on securities
exchanges.
MANAGEMENT OF THE FUND
The following table reflects the name and address, position held with the Fund
and principal occupation during the past 5 years for those persons who are the
officers and directors of the Fund.
<TABLE>
<CAPTION>
Name and Address Position with Fund Principal Occupation during past 5 years
<S> <C> <C>
*Luther E. Tyson, Ph.D. President and Director Sociologist, ethicist, and clergyman. From 1966-85
**69 Wentworth Lane (since inception) 1970 he served as Director of a Department of the Board
P.O. Box 351448 of Church and Society of The United Methodist
Palm Coast, FL 32135 Church.
*J. Elliott Corbett Ph.D. Vice President Social ethicist and clergyman. From 1961 to Decem-
**6006 Milo Drive and Director ber,1 980 he was a member of the staff of the United
Bethesda, MD 20816 (since inception) 1970 Methodist Board of Church and Society He served as
President of Pax World Foundation from 1970-1990.
*Anthony S. Brown Vice President, 1970 to present, Treasurer and Director Pax World
**209 Lafayette Road Treasurer and Director Management Corp. (adviser to the Fund); portfolio
Portsmouth,NH03801 (since inception)1970 manager of the Fund; from July 1982 to Decem-
(Portfolio Manager) ber 1990, registered representative with Fahnestock
& Co., members of the New York Stock
Exchange and from August 1987 to
December 1990, a Vice President and
office manager; a tru Piscataqua Savings Bank, Portsmouth,
NH, since July 1990 and Chairman of the Board
since August 1992
C. Lloyd Bailey Director An attorney; he served during 1959-1979 as Exec-
1216 Foulkeways (since inception) 1970 utive Director of the United States Committee for
Gwynedd, PA 19436 UNICEF and from 1980-81 as President of that
Committee. Since 1981 to the present he has served
as a consultant to that Committee.
Ralph M. Hayward Director Retired in 1971 after 31 years of employment
57 Barrell Lane (since 1978) with Merck and Co., Rahway, New Jersey
where he held York Harbor, ME 03911 various executive
positions. He is currently President
and principal stockholder of Fisher-James Company,
Inc.of Biddeford and Sanford, Maine, an office supply and
equipment dealer.
Joy L. Liechty Director 1989 to present, Client and Sales Advocate of Men-
919 South Seventh St. (since 1991) nonite Mutual Aid Association; from 1980-89
Goshen, IN 46526 Manager of Client Services of Mennonite Mutual Aid
Association
Raymond L. Mannix Director Certified public accountant, and Professor
71 Richmond Road Emeritus(since inception) 1970 of Boston University
Belmont, MA 02178 where he served as a Professor in the College of
Business Administration for more than forty years
Sanford C Sherman Director Presient/CEO, Piscataqua Savings Bank
91 Hillside Drive since Dec., 1992) Portsmouth, NH, April 1981 to date, Twenty-
Portsmouth,NH 03801 one years prior thereto, he held various other
positions with the bank including Treasureer and
Vice President; he also served the bank as a
Trustee for twenty years.
Esther J. Walls Director Director From 1974-1988, Associate Director of Libraries,
160 West End Avenue (since 1981) State University of New York, Stony Brook, L.I.,
Apt.29J New York, Currently, library consultant
New York, NY 10023
William M. Prifti Secretary Attorney, engaged in the private practice of the law
Suite 204,220 Broadway and General Counsel since 1968.
Lynnfield, MA 01940
</TABLE>
Designates a Director or Officer who is an interested person as defined by the
Investment Company Act of 1940.
**Designates a member of the Executive Committee and Investment Committee
Members of the Audit Commune: Messrs. Mannix and Hayward
Members of the Executive Committee assist in making investment decisions
and in executing various decisions of the Board of Directors. None of the
officers or directors are related to one another by blood, marriage or adoption.
As of April 22, 1996, control of the Fund may be acknowledged to rest
with Luther E. Tyson, J. Elliott Corbett and Anthony S. Brown. Anthony S.
Brown is the Portfolio Manager for the Fund.
No person on such date owned of record or beneficially 5% or more of the
outstanding Common Stock of the Fund and all officers and directors as a group
own less than 1% of the outstanding Common Stock of the Fund.
INVESTMENT ADVISORY AND OTHER SERVICES
The officers and directors of the Adviser are:
Luther E. Tyson, President and Director of the Adviser and President and
Director of the Fund.
J. Elliott Corbett, Vice-President and Director of the Adviser and Vice
President, and a Director of the Fund.
Anthony S. Brown, Treasurer, Assistant Secretary, and Director
of the Adviser and a Vice-President,Treasurer and Director of the Fund.
Paul V. Brown, Jr., Secretary, Assistant Treasurer, and Director of the Adviser.
Messrs. Tyson, Corbett, Brown and Brown own approximately 29 percent, 29
percent, 29 percent and 13 percent, respectively, of the outstanding shares of
the Investment Adviser and may be considered controlling persons of the Adviser.
The Fund has contracted with Pax World Management Corp. to advise and make
recommendations with respect to its investments and investment policies. In
addition, the Adviser has agreed to pay all executive officers' salaries, if
any, and expenses and office rent of the Fund and to reimburse the Fund if and
to the extent the Fund's expenses in any calendar year other than interest,
brokerage commissions, fees, taxes and distribution expenses under the Rule 1
2b-1 Plan exceed 1 1/2% average net assets. No reimbursement has been
required since December 31,1982. The Adviser was organized in 1970, and has had
from that time to the present as its only client, the Fund.
As compensation for its services, the Fund will pay the Adviser an annual
fee of 3/4 of 1% of the Fund's average net assets on the first $25,000,000 and
which fee adjusts to 1/2 of 1% of average net assets in excess of that figure.
This fee is computed on a daily basis and paid monthly.
The following table shows the amount of the advisory fee and the amount of
such fee stated as a percent of the average annual net asset value of the Fund
for the years ended December 31, 1993, 1994 and 1995.
<TABLE>
<CAPTION>
<S> <C> <C>
Approximate Percent of
Amount of Average
Fee Annual Net
Asset Value
of Fund
Year ended December 31, 1993 $2,489,000 See above
Year ended December 31, 1994 $2,091,000 See above
Year ended December 31, 1995 $2,192,000 See above
</TABLE>
The contract with the investment adviser (original date August 5, 1971 )
remained in force for a period of two years after initial approval by
shareholders and has been approved by the shareholders annually thereafter (and
last approved June 10, 1992). The contract will continue in force year to year
so long as the continuation is specifically approved at least annually either
(i) by the Board of Directors of the Fund or (ii) by a vote of a majority of the
outstanding securities of the Fund, provided that in either event the
continuation must be approved by a vote of a majority of the Directors who are
not parties to the contract or interested persons of the Fund or of the Adviser,
cast in person at a meeting called for the purpose of voting on such an approval
or by written consent. Such Independent board approval has occurred annually.
The investment advisory agreement will terminate automatically in the event of
its assignment. In addition, the contract is terminable at any time without
penalty by the Board of Directors of the Fund or by a vote of a majority of the
Fund's shares on 60-days' notice to the Adviser and by the Adviser on 60-days'
notice to the Fund. OTHER EXPENSES
Non-officer Directors, are each paid a fee of $1,000 for attendance at each
Directors' Meeting officer Directors are each paid $200. For the fiscal year
ended December 31, 1995 Directors' attendance fees amounted to approximately
$26,400 and an additional $10,298 was paid for travel costs.
The Fund has a distribution expense in effect under the provisions of
Rule 1 2b-1 under the Investment Company Act of 1 940. During the last
fiscal year approximate amounts paid by the Fund under the Plan were spent
on: advertising: $172,000, printing and postage: $66,650; and sales related
expenses: $151,200.
CUSTODIAN
The Fund has engaged the State Street Bank and Trust Company, 225 Franklin
Street, Boston, Massachusetts 02110 as custodian for all its security
investments and cash. The custodian has no responsibility for any part in the
purchase and sale of Fund investments or in the declaration of dividends and
distributions. When authorized and directed by the Fund, the custodian may
appoint one or more subcustodians to perform such of the custodian duties as are
specified in such authorization. In addition, the custodian performs portfolio
securities clearance matters, holds securities in safekeeping and assists in the
daily pricing of the net asset value of the shares of the Fund.
PFPC Inc. is the Fund's transfer agent and dividend disbursing
agent. Accordingly, it will answer correspondence from shareholders. T
herefore, correspondence relating to a shareholder's account should be
directed to PFPC Inc., the company's Plan Agent.
INDEPENDENT AUDITORS
Pannell Kerr Forster, P.C., are the independent auditors of the Fund for
the 1995 financial statements and are located at 125 Summer Street, Boston,
Massachusetts 02110. They audit the Fund's financial statements as required
under the Investment Company Act of 1940, as amended, including the annual
report to stockholders, financial statements required by Form N-1 A and
information needed to prepare the prospectus and documents required for state
registration statements and they prepare the annual franchise tax statements to
the state of Delaware (state of incorporation) and any other tax returns
required to be prepared by the Fund.
BROKERAGE ALLOCATION
Management's primary consideration in placing orders for the purchase and
sale of portfolio securities is to obtain the best price and prompt, accurate
execution of its orders. Any over-the-counter purchases and sales may be
transacted directly with principal market-makers except in those circumstances
where in the opinion of management better prices and executions are available
elsewhere. The Fund may consider the amount of statistical research received
from brokerage firms in placing any brokerage orders and which may reduce the
cost of such research and other services to the adviser. Such services may
include standard market reports available to the securities industry and the
public generally. The officers of the Fund make the portfolio decisions,
allocate brokerage orders, and are authorized to pay a brokerage commission in
excess of that which another broker might have charged for effecting the same
transaction in recognition of the value of brokerage or research services
provided by the broker. The Fund is also provided at no cost with the use of a
computer quote equipment by a broker in order to assist the Fund Adviser in
research and market activity and portfolio decisions.
For the years ended December 31, 1993, 1994, and 1995 brokerage commissions
amounted to approximately $366,000, $382,000, 360,000 respectively.
The brokerage firms selected provide, in the case of government
agency bonds, best price and research service. In like manner, equity
securities transactions executed by other brokerage firms are based on price,
execution and research service. Any allocation to research services
is arbitrary and not through any prearrangements.
CAPITAL STOCK
The Fund, organized in February 1970, is authorized by its Articles of
Incorporation as amended by the shareholders on June 10,1993 and pursuant to
Delaware law to issue 75,000,000 shares of common stock of a par value of $1 per
share. Such shares have no preference, pre-emptive, conversion or exchange
rights except as outlined in the prospectus. The stock offered will, in the
opinion of General Counsel, when issued and sold, be fully paid and
nonassessable. Each share has one vote in corporate matters (fractional shares
have proportionate voting rights), are freely transferable and are entitled to
dividends as determined by the Board of Directors and in liquidation of the Fund
are entitled to receive the net assets of the Fund. The shares have
noncumulative voting rights, which means that the holders of more than 50
percent of the shares voting for the election of directors can elect 100 percent
of the directors if they choose to do so and, in such event, the holders of the
remaining less than 50 percent of the shares voting will not be able to elect
any directors.
PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED
See Part A--Prospectus and caption, "How to Purchase Shares" for details of
the manner in which the Fund shares may be purchased by the public.
The net asset value of the Fund's shares is determined as of the close of
business of the NewYork Stock Exchange on each business day on which that
Exchange is open, by dividing the value of the Fund's securities, plus any cash
and other assets (including dividends accrued but not collected) less all
liabilities (including accrued expenses but excluding the capital and surplus),
by the number of shares outstanding.
In valuing the Fund's assets, a security listed on the New York Stock
Exchange is valued at its last sale price on that Exchange on the day as of
which assets are valued. Lacking any sales on the day, the security is valued at
the mean between the bid and asked price. Securities listed on other exchanges
are similarly valued, using quotations on which the security is traded most
extensively.
An unlisted security for which over-the-counter market quotations are
readily available is valued on the basis of such quotations--the last sale
price, or lacking any such sales quotations, an amount determined by the Fund's
management with the approval of its Board of Directors, not higher than the last
asked price or lower than the last bid price. Securities which are subject to
restrictions as to resale and securities for which over-the-counter quotations
are not readily available, and any other assets shall be valued in good faith by
the Board of Directors at their fair value.
The net asset value for the purpose of any transaction in the shares of the
Fund shall be that which is next computed after receipt of a tender of such
security for redemption or of an order to purchase such security.
Shareholders of the Fund will automatically have reinvested all income
dividends and capital gains distributions, if any, in additional shares of the
Fund at net asset value unless the dividend paying agent is notified at least
ten days before the record date that the shareholder wishes to elect to:
(1) Receive income dividends in cash and capital gains distributions in
additional shares at net asset value, or (2) Receive all income dividends and
capital gains distributions in cash. The Fund's policy is to distribute annually
to shareholders all, or substantially all, of its net investment income and net
realized capital gains, if any. Income payments are usually made during the
third and fourth quarters in each fiscal year.
Capital gains, likewise, are usually paid during the fourth quarter.
TAX STATUS
The Fund qualifies for tax treatment as a "regulated investment company"
under subchapter M of the Internal Revenue Code. The Fund will distribute its
net income and gains to shareholders and such distributions have been generally
treated as taxable income since 1986. Shareholders not subject to tax on their
income will not be required to pay tax on amounts distributed to them. The Fund
will inform shareholders of the amount and nature of such income or gains.
The Fund is required by federal law to withhold 31 % of dividends and
capital gains distributions (if any) paid to certain accounts which have not
complied with Internal Revenue- Service regulations. In connection with this
withholding requirement, a purchaser of Fund shares will be asked to certify on
our application that the Social Security or tax identification number provided
is correct and that a purchaser is not subject to 31 % back-up withholding for
previous underreporting to the IRS.
Any dividend or distributions paid shortly after a purchase of shares by an
investor will have the effect of reducing the per share net asset value of
shares by the per share amount of the dividends or distributions. Furthermore,
such dividends or distributions, whether in cash or in shares, although in
effect a return of capital, are subject to income taxes.
The Tax Reform Act of 1986 (the "TRA") was signed into law on October 22,
1986 and changed the rates of tax applicable to ordinary income and capital
gains for individuals after 1986 and for corporations in tax years beginning
after July 1,1986. The "TRA" repealed the annual dividend exclusion allowance
for individuals, reduced the dividends received deduction for corporation from
85% to 80% and substantially revised the federal income tax treatment of
contributions to retirement plans such as I RAs and 403(b) plans. The "TRA" also
contains other provisions that may affect the shareholders.
Dividends and distributions may also be subject to state and local taxes.
Since January 1,1984 a stockholder must furnish a correct identification number
(social security number, usually) in order to avoid a penalty under the Internal
Revenue Code provisions.
PAX WORLD FUND, INCORPORATED
STATEMENT OF ASSETS AND LIABILITIES
December 31,1995
ASSETS
Investments, at value--note A
Common stocks (cost - $276,331,183).........................$345,870,695
Bonds (cost - $125,760,547)................................. 121,126,345
Cash..............................................................3,395,358
Receivables
Dividends and ninterest...........................................3,322,347
Total assets............................................ 477,714,744
LIABILITIES
Payables
Capital stock reacquired ........................................373,187
Accrued expenses
Investment advisory
fee..............................................................202,847
Transfer agent
fee...............................................................65,343
Other accrued
expenses..........................................................97,007
Total liabilities...................................................738,384
Net assets (equivalent to $16.33 per share based on 29,200,151 shares
of capital stock outstanding)--note E...................$476,976,360
Net asset value, offering price and redemption price per share
($476,976,360 divided by 29,200,151 shares outstanding) .....$16.33
PAX WORLD FUND,INCORPORATED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<S> <C> <C>
Year Ended December 31
1995 1994
Increase (decrease) in net assets
Operations
Investment income - net ................................... $ 14,647,876 $ 14,855,197
Net realized gain (loss) on investments ............................ 11,647,876 ( 7,903,511)
Change in unrealized appreciation (depreciation) of investments .... 83,655,967 1,894,818
Net increase (decrease) in net assets resulting from operations . .. 110,157,319 8,846,504
Net equalization (debits)..............................................(143,513)
(623,310)
Distributions to shareholders from
Investment income--net ($.79 and $.50 per share, respectively) .....(22,242,270) (14,563,371)
Net realized gain on investments ($.14- and $-0- Per share
respectively) Note A ........................................ ( 3,936,953)
Capital share transactions - note E ........................... 4,892,325 (68,172,746)
Net (decrease) in net assets.........................................88,726,908 (74,512,923)
Net assets
Beginning of year......................................... 388,249,452 462,762,375
End of year (including undistributed investment income - net
of $319,091 and $138,823 respectively)....................$476,976,360 $388,249,452
See notes to financial statements.
</TABLE>
PAX WORLD FUND, INCORPORATED
STATEMENT OF OPERATIONS
Year Ended December 31,1995
Investment income
Income - note A
Dividends..........................................................$ 9,687,946
Interest..............................................................8,953,133
Total
income...............................................................18,641,079
Expenses
Investment advisory fee - note
B................................................$2,191,647
Transfer agent
fee.................................................846,893
Distribution expenses - note D......................503,888
Printing ...........................................129,952
Custodian fees-note F...............................129,096
State taxes..........................................89,018
Audit fees...........................................55,450
Registration fees....................................49,953
Legal fees and related expenses - note B.............49,837
Directors' fees and expenses-note B..................36,698
Other................................................33,378
Total expenses....................................4,115,810
Less: Fees paid indirectly-note F...................122,607
Net expenses..........................................................3,993,203
Investment income-net.................................................14,647,876
Realized and unrealized gain (loss) on investments - note C
Net realized (loss) on
investments.......................................................11,853,476
Change in unrealized appreciation (depreciation) of investments for the year...
.....................................................................83,655,967
Net gain on
investments..........................................................95,509,443
Net increase in net assets resulting from operations...............$110,157,319
See notes to financial statements.
PAX WORLD FUND, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
December 31,1995
NOTE A - ACCOUNTING POLICIES
Pax World Fund, Incorporated (the "Fund") is a diversified,
open-end management investment company registered under the Investment
Company Act of 1940, as amended. Significant accounting policies of the Fund
are as follows:
Valuation of Investments
Securities listed on any national, regional or local exchange are
valued at the closing prices on such exchanges. Securities listed on the
NASDAQ national market system are valued using quotations obtained from the
market maker where the security is traded most extensively.
Federal Income Taxes
The Fund's policy is to comply with the requirements of the Internal
Revenue Code that are applicable to regulated investment companies and to
distribute substantially all its taxable income to its shareholders.
Therefore, no Federal income tax provision is required.
Equalization
The Fund uses the accounting practice known as "equalization" by which a
portion of the proceeds from sales and costs of redemptions of capital shares,
equivalent on a per share basis to the amount of undistributed net investment
income on the date of the transactions, is credited or charged to undistributed
income. As a result, undistributed net investment income per share is unaffected
by sales or redemptions of capital shares.
Equalization is a permanent book/tax difference that causes a
difference between investment income and distributions.
Distributions to shareholders
All distributions to shareholders are recorded by the Fund on the
ax-dividend dates.
In accordance with the Internal Revenue Code and applicable Revenue
Rulings, the amount of the 1995 distribution which could be designated as a
capital gain dividend ($11,855,124) was reduced by $7,918,171, the amount of the
1994 capital loss carryover utilized in 1995. The resulting distribution
designated as a capital gain dividend was $3,936,953. The 1995 distribution of
net investment income, correspondingly, was increawed by $7,918,171.
Accounting estimates
The preparation of financial statements inconformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Other
The Fund follows industry practice and records security transactions on
the trade date. Dividend income is recognized on the ex-dividend date, and
interest income is recognized on an accrual basis.
NOTE B - INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement ("Agreement") with Pax World
Management Corp. ("Advisor") which provides for payment by the Fund of an annual
investment advisory fee of 3/4 of 1 % of its average daily net assets on the
first $25,000,000 and 1 /2 of 1 % of its average daily net assets in excess of
that amount. Three officers and directors of the Fund are also officers and
directors of the Advisor. The Agreement provides for an expense reimbursement
from the Advisor if the Fund's total expenses, exclusive of interest, brokerage
commissions or fees, and taxes, but including the investment advisory fee,
exceeds 1 -1 /2% of the average daily net asset value of the Fund for any full
fiscal year. An expense reimbursement was not required for either 1995 or 1994.
All Directors are paid by the Fund for attendance at directors' meetings.
During 1995, the Fund incurred legal fees and related expenses of
$49,387 with William M. Prifti, Esq.,
general counsel for the Fund. Mr. Prifti is Secretary of the Fund.
NOTE C - INVESTMENTS
Purchases and proceeds from 1995 sales of investments, other than U.S.
Government agency bonds, aggregated $102,120,992 and $93,148,457 respectively.
Purchases and proceeds from 1995 sales and maturities of U.S.
Government agency bonds aggregated $16,889,375 and $31,000,000, respectively.
Net realized gain or loss on sales of investments is determined on the
basis of identified cost. If determined on an average cost basis, the net
realized gain for 1995 would have been approximately the same. For Federal
income tax purposes, the identified cost of investments owned at December
31,1995 was $402,091,730.
NOTE D - DISTRIBUTION EXPENSES
The Fund maintains a distribution expense plan pursuant to Rule 1 2b-1
under the Investment Company Act of 1 940, as amended. The plan provides that
the Fund may incur distribution expenses of up to twenty-five one hundredths of
one percent (.25%) per annum of its average daily net assets to finance activity
which is primarily intended to result in the sale of Fund shares. Such expenses
include (but are not limited to) travel and telephone expenses, preparation and
distribution of sales literature and advertising, and compensation to be paid to
and expenses to be incurred by officers, directors and/or employees of the Fund
or of the third parties for their distributional services, if sales of the Fund
are made by such third parties during a fiscal year.
NOTE E - CAPITAL AND RELATED TRANSACTIONS
Transactions in capital stock were as follows:
<TABLE>
<S> <C> <C> <C> <C>
Year Ended Year Ended
December 31, 1995 December 31, 1994
Shares Dollars Shares Dollars
Shares sold.................................... 2,834,187 $ 42,166,166 2,657,536 $35,050,900
Shares issued in reinvestment of dividends. 1,512,585 24,008,199 1,013,669 13,207,148
4,346,772 66,174,365 3,671,205 48,258,048
Shares redeemed................................ (4,146,698) (61,282,040) (8,813,015) (116,430,794)
Net increase (decrease)........................... 200,074 $ 4,892,325 (5,141,810) $(68,172,746)
</TABLE>
The components of net assets at December 31, 1995, are as follows:
Paid-in capital (75,000,000 shares of $1 par value authorized). $415,671,783
Undistributed investment income................................ 319,091
Excess distribution of capital gains........................... (1,652)
Accumulated prior years' net realized losses on investments.... (7,918,171)
Net unrealized appreciation of investments.................... 68,905,309
Net assets................................................$476,976,360
NOTE F - CUSTODIAN BANK
State Street Bank and Trust Company is the custodian bank for the Fund's assets.
The custodian fees charged by the bank are reduced, pursuant to an expense
offset arrangement, by an earnings credit which is based upon the average cash
balances maintained at the bank. If the Fund did not have such an offset
arrangement, it could have invested the amount of the offset in an
income-producing asset.
PAX WORLD FUND, INCORPORATED
SCHEDULE OF INVESTMENTS
December 31,1995
<TABLE>
<CAPTION>
<S> <C> <C> <C>
NAME OF ISSUER AND TITLE OF ISSUE NUMBER OF SHARES VALUE PERCENT OF NET ASSETS
COMMON STOCKS
CONSUMER PRODUCTS
Colgate-Palmolive Co....................50,000 $ 3,512,500
Dial Corp..............................112,500 3,332,812
Liz Claiborne, Inc ....................190,000 5,272,500
Stride Rite Corp.......................245,900 1,844,250
13,962,062 2.9%
ELECTRIC UTILITY
Teco Energy, Inc......................200,000 5,125,000 1.1
FOOD
CPC International, Inc...............175,000 12,009,375
Campbell Soup Co.....................361,700 21,009,375
General Mills, Inc...................200,000 11,550,000
H J Heinz Co.......................1,012,500 33,539,063
Quaker Oats Co...................... 50,000 1,725,000
80,525,438 16.9
HOME IMPROVEMENT PRODUCTS
Home Depot, Inc................. 150,000 7,181,250
Masco Corp...................... 100,000 3,137,500
10,318,750 2.2
LOANS - STUDENT
Student Loan Marketing Association...... 42,600 2,806,275 .6
MAILING EQUIPMENT
Pitney Bowes, Inc....................... 166,700 7,834,900 1.6
NATURAL GAS
Bay State Gas Co........................ 553,800 15,367,950
Brooklyn Union Gas Co................... 587,600 17,187,300
Enron Corp.............................. 100,000 3,812,500
Peoples Energy Corp..................... 551,900 17,522,825
Washington Gas Light Co................. 18,400 377,200
54,267,775 11.4
PACKAGING
Bemis Co., Inc......................... 50,000 1,281,250 .3
PHARMACEUTICALS
Bristol-Myers Squibb Co................ 200,000 17,175,000
Johnson & Johnson...................... 200,000 17,125,000
Merck & Co., Inc....................... 700,000 46,025,000
Pfizer, Inc............................ 218,900 13,790,700
94,115,700 19.7
PAX WORLD FUND,INCORPORATED
SCHEDULE OF INVESTMENTS, continued
NAME OF ISSUER AND TITLE OF ISSUE NUMBER OF PERCENT OF
SHARES VALUE NET ASSETS
COMMON STOCKS, continued
RETAIL
Albertsons, Inc 100,000 $ 3,287,500
Darden Restaurants, Inc. 200,000 2,375,000
Gap, Inc. 250,000 10,500,000
Hechinger Co, Class A 622,500 2,762,344
Hechinger Co, Class B 5,000 23,750
The Limited, Inc 250,000 4,343,750
Smith's Food & Drug Centers,Inc,Class B 134,800 3,403,700
Toys R Us, Inc 200,000 4,350,000
Wal-Mart Stores, Inc 500,000 11,187,500
42,233,544 8.8%
TELEPHONE UTILITIES
BellSouth Corp. 100,000 4,350,000
NYNEX Corp 300,000 16,200,000
US West, Inc-Communications Group 200,000 7,150,000
U.S. West, Inc.-Meida Group 300,000 5,700,000
33,400,000 7.0
TOTAL COMMON STOCKS 345,870,694 72.5%
GOVERNMENT AGENCY BONDS PRINCIPAL AMOUNT
Federal Farm Credit Banks Consolidated
7.750%, due December 9, 1997 $10,000,000 10,450,280
Federal Home Loan Bank System
8.100%, due March 25,1996 9,000,000 9,053,478
8.250%, due September 25,1996 15,000,000 15,309,330
6.540%, due October 3,1996 5,000,000 5,045,800
6.995%, due November 8,1996 10,000,000 10,147,910
5.660% due November 9, 1998 7,000,000 7,050,078
Federal National Mortgage Association
8.150%, due August 12,1996 6,000,000 6,099,612
7.700%, due September 10,1996 7,000,000 7,109,501
7.600%, due January 10,1997 10,000,000 10,215,600
6.050%, due November 10,1997 14,000,000 14,160,076
7.510%, due November 14,1997 10,000,000 10,392,180
5.620%, due February 10, 1999 10,000,000 10,009,700
International Bank for Reconstruction
& Development
5.875% due July 16, 1997 10,000,000 10,082,800
TOTAL GOVERNMENT AGENCY BONDS 125,126,345 26.2%
TOTAL INVESTMENTS 470,997,039 98.7
Cash and receivables, less liabilities 5,979,321 1.3
NET ASSETS $476,976,360 100.0%
See notes to financial statements.
</TABLE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Shareholders
Pax World Fund, Incorporated
We have audited the statement of assets and liabilities of Pax World Fund,
Incorporated, including the schedule of portfolio investments, at December 31,
1995, and the related statement of operations for the year then ended, the
statement of changes in net assets for each of the two years in the period then
ended and financial highlights for each of the ten years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of Pax
World Fund, Incorporated at December 31, 1995, the results of its operations for
the year then ended, the changes in its net assets for each of the two years in
the period then ended, and financial highlights for each of the ten years in the
period then ended, in conformity with generally accepted accounting principles.
PANNELL KERR FORSTER, P.C. Boston, Massachusetts January 11, 1996
PAX WORLD FUND
INCORPORATED
PART C
OTHER INFORMATION
Part C.
Other Information
FINANCIAL STATEMENTS AND EXHIBITS
(a) The following financial statements are included in the Registration
Statement:
Part A--Financial Highlights
Part B--Statements of Assets and Liabilities, Operations, Changes in Net
Assets,
Notes to Financial Statements
all at December 31,1995 and Independent Auditors' Report.
(b) Exhibits
1.) Articles of Organization
* 2.) By-Laws
3.) Not applicable
4.) Specimen copy of certificate of common stock
5.) Investment Advisory Contract
6.) Not applicable
7.) Not applicable
* 8a.) Custodial and Depository Agreements with State Street Bank and Trust
Company
* 8b.) Transfer and Disbursing agreements with PFPC, Inc.
9.) Not applicable
10.) Opinion and consent of counsel
11.) Consent of Pannell Kerr Forster, P.C., independent auditors
12.) Financial statements omitted under item 23 (Financial Statements)
13.) Not applicable
14.) Not applicable
* 15.) Rule 12b-1 Plan
*Previously filed pursuant to 1933 Act Registration Statement and Investment
Company Act #811 -2064-B and Rule 12b-1 Plan by amendment #24 to Form N-1 A;
Transfer Agent Agreement filed supplementally with a Supplement Prospectus,
dated November 11,1991; and which are all incorporated herein by reference.
NUMBER OF HOLDERS OF SECURITIES
As of March 1,1996 there were the following record owners of Common Stock:
approximately 48,000.
INDEMNIFICATION
Statement concerning the general effect by statute and the by-laws by which
any director and officer is indemnified has been stated in the registration of
the Fund #2-38679 and is incorporated herein by reference.
LOCATION OF ACCOUNTS AND RECORDS
The accounts, books and other financial records are maintained by the State
Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110
and by the Fund at 224 State Street, Portsmouth, N.H.03801. Transfer Agent
records of shareholder accounts and activity are at PFPC, Inc., 400 Bellevue
Parkway, Wilmington, DE 19809.
April 15, 1996
Securities and Exchange Commission
Washington, D.C.
20549
Re: Pax World Fund, Incorporated
File No. 2-38679
Post-Effective Amendment No. 36
The undersigned has reviewed the Post-Effective Amendment to the
Registration Statement on Form N-IA for the above Fund. Such documentation,
including the Prospectus, does not contain disclosures which would render it
ineligible to become effective pursuant to paragraph (b) of Rule 485.
Very truly yours,
S/
William M. Prifti
April 15, 1996
Pax World Fund, Incorporated
224 State Street
Portsmouth, N.H. 03801
Gentlemen:
As General Counsel for Pax World Fund, Incorporated, a Delaware
corporation (the "Company"), I am generally familiar with its corporate
instruments and affairs and I have supervised the corporate proceedings taken in
connection with the proposed issue and sale of the $1 par value Common Stock of
the Company and with the proceedings taken to register such shares under the
Securities Act of 1933 as amended, and with the Registration Statement filed
with the Securities and Exchange Commission under said Act and under the
Investment Company Act of 1940.
As such counsel I have reviewed certain current proceedings of the
Company, agreements and other instruments, certificates of public officials and
other officers of the Company and such other documents as I have deemed
necessary as a basis for the opinions hereinafter expressed.
Based on the foregoing, I am of the opinion that:
1. The Company is a corporation duly organized and validly existing
and in good standing under Delaware law.
2. The Company has authorized capital stock consisting of 75 million
shares of common stock, $1 par value, of which in excess of 29
million shares have been issued and are outstanding.
3. The indefinite number of shares of common stock to be issued and
sold by the Company will, when issued and sold under the circumstances
contemplated in the Registration Statement as amended to provide for
the issuance of an indefinite number of shares pursuant to Rule 24f-2
under the Investment
Company Act of 1940, be validly issued, fully paid and non-assessable.
I hereby consent to the use of my name and this opinion in the amended
registration statement of the Fund.
Very truly yours,
S/
William M. Prifti
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the use in this Post0Effective Amendment No. 36 to Registration
Statement Number 2-38679 on Form N1-A of our report dated January 11, 1996
on the financial statements and financial highlights of Pax World Fund,
Incorporated included in the Statement of Additional Information and to the
reference made to us under the captions "Synopsis-Auditors" in the Prospectus
and under the caption "Independent Audtiors" in the Statement of Additional
Information.
S/
PANNELL KERR FORSTER, P.C.
Boston, Massachusetts
April 1996
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this amended registration to be signed on its behalf
by the undersigned, thereto duly authorized, on the day of
PAX WORLD FUND, INCORPORATED
by S/
Luther E . Tyson, President
Pursuant to the requirements of the Securities Act of 1933, this
amended registration statement has been signed by the following persons in the
capacities indicated:
S/
Luther E. Tyson President, Director and Principal Executive Officer
S/
J. Elliott Corbett Vice-President and Director
S/
Anthony S. Brown Vice-President, Director, Treasurer, Financial
and Accounting Officer
S/
C. Lloyd Bailey Director
S/
RaIph M. Hayward Director
S/
Raymond L. Mannix Director
S/
Esther J. Walls Director
S/
Joy L. Liechty Director