<PAGE>
Registration Nos. 33-16665
811-5293
- - ------------------------------------------------------------
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. 9 X
--- ---
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 11 X
---- ---
CARILLON INVESTMENT TRUST
(Exact Name of Registrant as Specified in Charter)
1876 Waycross Road, Cincinnati, Ohio 45240
(Address of Principal Executive Offices)
(513) 595-2600
(Registrant's Telephone Number)
John F. Labmeier, Esq.
Carillon Investment Trust
1876 Waycross Road
Cincinnati, Ohio 45240
(Name and Address of Agent for Service)
Copy to:
Routier and Johnson, P.C.
1700 K Street, N.W. Suite 1003
Washington, D.C. 20006
--------------------------
Pursuant to Rule 24f-2 under the Investment Company Act of
1940, the Registrant has registered an indefinite amount of
securities under the Securities Act of 1933. A Rule 24f-2
Notice for Registrant's fiscal year ended October 31, 1995 was
filed on December 28, 1995.
-------------------------
It is proposed that this filing will become effective (check
appropriate box)
___ immediately upon filing pursuant to paragraph (b)
of Rule 485
X on February 28, 1996 pursuant to paragraph (b)
- - ---- of Rule 485
___ 60 days after filing pursuant to paragraph (a)
of Rule 485
___ on (date) pursuant to paragraph (a) of Rule 485
---------------------------
<PAGE>
CARILLON INVESTMENT TRUST
CROSS-REFERENCE SHEET
<TABLE>
<CAPTION>
HEADINGS IN PROSPECTUS
OR STATEMENT OF ADDITIONAL
FORM N-1A ITEMS INFORMATION
- - --------------------------------------------------------------------
PART A
----------
<S> <C>
1. Cover Page Cover (Prospectus)
2. Synopsis Fund Expenses
3. Condensed Financial Information Financial Highlights
4. General Description of Registrant The Trust; The Fund;
Investment Objectives
and Policies
5. Management of the Fund Management of the Trust;
Custodian, Transfer and
Dividend Disbursing
Agent
6. Capital Stock and Other Securities Shareholder Voting;
Shareholder Liability;
Dividends and Distributions;
Taxes; Shareholder Inquiries
7. Purchase of Securities Being Offered Purchase of Fund Shares
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings *
PART B
--------
10. Cover Page Cover Page (Statement of
Additional Information)
11. Table of Contents Table of Contents
12. General Information and History The Trust
13. Investment Objectives Investment Policies;
Investment Restrictions;
Portfolio Turnover
14. Management of the Fund Management of the Trust
15. Control Persons and Principal
Holders of Securities The Trust
16. Investment Advisory and Other Investment Adviser;
Services Distribution of Shares;
Custodian, Transfer and
Dividend Disbursing Agent
17. Brokerage Allocation Investment Adviser
18. Capital Stock and Other Securities The Trust
19. Purchase, Redemption and Pricing of Purchase and Redemption
Securities Being Offered of Shares
20. Tax Status Taxes
21. Underwriters Distribution of Shares
22. Calculation of Performance Data Performance
23. Financial Statements Independent Auditors
</TABLE>
PART C
--------
Information required to be included in Part C is set forth
under the appropriate Item, so numbered, in Part C of this
Registration Statement.
- - -----------------------------
* Omitted from the Prospectus or Statement of Additional
Information because the Item is inapplicable.
<PAGE>
PART A
INFORMATION REQUIRED IN A PROSPECTUS
PROSPECTUS
Carillon Capital Fund
of
Carillon Investment Trust
Carillon Capital Fund (the "Fund") is an investment
portfolio of Carillon Investment Trust (the "Trust"), a
diversified, open-end management investment company.
The Fund seeks to provide the highest total return through a
combination of income and capital appreciation consistent with
the reasonable risks associated with an investment portfolio,
which in the sole determination of the investment adviser, would
be of above average quality when compared to other portfolios.
The Fund's investments will include equity securities, debt
instruments and money market instruments. In purchasing debt
securities, the Fund will primarily invest in debt securities
rated in one of the four highest rating categories as determined
by a nationally recognized rating service, or, if unrated, of
equivalent quality as determined by the investment adviser. The
Fund may, however, invest up to 25% of the total value of the
debt securities it holds in high-yield (high-risk) bonds or the
equivalent thereof in unrated securities. High-yield (high-risk)
bonds typically are subject to greater market fluctuations and
risk of loss of income and principal due to default by the issuer
than are investments in lower yielding, higher-rated bonds.
As a result of the market risk inherent in any investment,
there is no assurance that the investment objective of the Fund
will be realized. Investments in the Fund are neither insured nor
guaranteed by the U.S. Government or any other entity or person.
A sales charge is deducted from the amount invested. This
sales charge ranges from 5% for investments of less than $50,000
to .5% for investments of $2,500,000 or more. (See "Sales
Charge," page 10.) Fund shares are suitable for purchase by
pension plan and IRA custodians, as well as the public generally.
---------------------------------
This Prospectus sets forth concisely the information that a
prospective investor should know before investing in the Fund,
and it should be read and kept for future reference. A Statement
of Additional Information dated February 28, 1996 that contains
further information about the Fund, has been filed with the
Securities and Exchange Commission and is incorporated by
reference into this Prospectus. A copy of the Statement of
Additional Information may be obtained without charge by calling
the Fund at (513) 595-2600, or by writing the Fund at P.O. Box
40409, Cincinnati, Ohio 45240.
-----------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Dated February 28, 1996
<PAGE>
FUND EXPENSES
Shareholder Transaction Expenses
(as a percentage of the offering price)
Maximum Sales Load Imposed on Purchase......... 5.00%
Annual Fund Operating Expenses
(as a percentage of average net assets)
Advisory Fees.................................. 0.75%
Other Expenses................................. 0.26%
Total Fund Operating Expenses.................. 1.01%
EXAMPLE The table below shows the expenses a shareholder would
pay on a $1,000 investment assuming a 5% annual return and no
redemptions.
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- - -------------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $60 $81 $103 $168
</TABLE>
The 5% annual return is a standardized rate prescribed for
the purpose of this example and does not represent the past or
future return of the Fund.
The purpose of the preceding table is to assist investors in
understanding the various costs and expenses an investor in the
Fund would bear. All expenses are borne directly or indirectly by
shareholders. The expense figures for the 3-year, 5-year and 10-year
periods represent the cumulative expenses for those periods.
(For more information about Fund expenses, see "Management of the
Trust," page 8, and "Purchase of Fund Shares," page 9.)
The example should not be considered a representation of
past or future expenses and the actual expenses may be greater or
lesser than those shown.
<PAGE>
FINANCIAL HIGHLIGHTS
The financial information in the table which follows,
insofar as it pertains to each of the five years in the period
ended October 31, 1995, has been audited in conjunction with the
annual audit of the financial statements of the Fund. The
financial statements for the year ended October 31, 1995, have
been audited by Deloitte & Touche LLP, whose unqualified report
thereon is included in the Statement of Additional Information.
The financial statements for the four years ended October 31,
1994, have been audited by another independent accountant, whose
reports expressed unqualified opinions on those statements. The
financial highlights should be read in conjunction with the
financial statements and notes thereto included in the Statement
of Additional Information. Further information about the
performance of the Fund is contained in the Trust's annual report
to shareholders which may be obtained without charge.
<TABLE>
<CAPTION>
Year ended October 31,
--------------------------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of period $13.01 $13.00 $12.45 $12.48 $ 9.79
Investment Activities:
Net investment income .52 .35 .42 .45 .46
Net realized and
unrealized gain (losses) .73 .16 1.27 .50 2.71
------ ------ ------ ------ ------
Total from Investment
Operations 1.25 .51 1.69 .95 3.17
Distributions:
Net investment income (.51) (.32) (.42) (.45) (.48)
Net realized gains (1.05) (.18) (.72) (.53) --
------ ------ ------ ------ ------
Total Distributions (1.56) (.50) (1.14) (.98) (.48)
Net Asset Value,
End of period $12.70 $13.01 $13.00 $12.45 $12.48
====== ====== ====== ====== ======
Ratios/Supplemental Data:
Total Return <F2> 10.88% 4.56% 14.50% 8.15% 32.99%
Ratio of Expenses
to Average Net Assets 1.01% 1.05% 1.11% 1.10% 1.19%
Ratio of Net Investment
Income to Average
Net Assets 4.44% 3.89% 3.35% 3.61% 4.03%
Portfolio Turnover Rate 42.07% 53.20% 43.35% 48.03% 42.07%
Net Assets,
End of Period
(in thousands) $46,644 $41,849 $33,863 $29,807 $27,385
CAPTION
<PAGE>
Year ended October 31,
---------------------- Period ended
1990 1989 10/31/88<F1>
---- ---- --------
<S> <C> <C> <C>
Net Asset Value,
Beginning of period $11.84 $11.17 $10.45
Investment Activities:
Net investment income .60 .54 .30
Net realized and
unrealized gains (losses) (1.44) 1.07 .70
------ ------ ------
Total from Investment
Operations (.84) 1.61 1.00
Distributions:
Net investment income (.52) (.62) (.28)
Net realized gain (.69) (.32) --
------ ------ ------
Total Distribution (1.21) (.94) (.28)
Net Asset Value,
End of period $9.79 $11.84 $11.17
====== ====== ======
Ratios/Supplemental Data:
Total Return <F2> (8.00%) 14.33% 9.68%
Ratio of Expenses
to Average Net Assets 1.27% 1.44 1.34%<F3>
Ratio of Net Investment
Income to Average
Net Assets 5.12% 4.88% 4.35%<F3>
Portfolio Turnover Rate 101.07% 92.32% 40.03%<F3>
Net Assets,
End of Period
(in thousands) $20,022 $22,203 $29,807
<FN>
- - ---------------
<F1>
Period from February 23, 1988 (the effective date of registration under the
Securities Act of 1933) through October 31, 1988.
<F2>
Assumes sales load is not imposed on either initial investment or
reinvestment of distributions.
<F3>
Annualized
</TABLE>
<PAGE>
<PAGE>
PERFORMANCE
From time to time the Fund may advertise "total return."
This calculation is based on historical earnings and is not
intended to indicate future performance. Investment return and
the principal value of an investment may fluctuate. Shares of the
Fund, when redeemed, may be worth more or less than their
original cost. All charges shown under "Fund Expenses" are
reflected in the calculation. Total return is computed by finding
the average annual rate of return that would equate the initial
amount invested to the ending redeemable value. The calculation
of total return assumes the reinvestment of all dividends and
distributions and the deduction of the maximum sales load from
the initial investment.
THE TRUST
The Trust was established under Massachusetts law pursuant
to a Declaration of Trust dated December 8, 1986, as an
unincorporated business trust, a form of organization that is
commonly called a Massachusetts business trust. The Trust is
registered with the Securities and Exchange Commission as a
diversified, open-end management investment company under the
Investment Company Act of 1940 ("1940 Act"). Such registration
does not involve the supervision of investments or investment
policy. The Declaration of Trust permits the Trustees to issue an
unlimited number of shares and to divide such shares into an
unlimited number of portfolios, all without shareholder approval.
THE FUND
The Fund is the only portfolio of the Trust currently being
offered. The Fund is analogous to a diversified, open-end
management investment company (mutual fund). Each share of the
Fund has an equal proportionate interest in the net assets and
net liabilities of the Fund. Each shareholder of the Fund is
entitled to a pro rata share of all dividends and distributions
arising from the net income and capital gains on its investments.
The shares of the Fund are continually offered for sale to the
public at net asset value subject to the imposition of a sales
charge.
INVESTMENT OBJECTIVES AND POLICIES
The Fund has investment objectives which it pursues through
its investment policies. The investment objectives of the Fund
(described on the cover of this Prospectus) are fundamental
policies and may not be changed without approval of a majority of
shareholders. There can be no assurance that the investment
objectives of the Fund will be realized.
The Fund seeks to obtain the highest total return through a
combination of income and capital appreciation consistent with
the reasonable risks associated with an investment portfolio, the
securities of which are selected by the investment adviser as
representing securities that it believes are of above-average
quality as compared to other portfolios.
The Fund invests in equity, debt and money market
securities. The Fund may borrow for temporary or emergency
purposes up to 10% of the value of its assets.
There are no percentage limitations on the type of
securities in which the Fund may invest. The Fund may invest
entirely in equity securities, entirely in debt, entirely in
money market instruments, or in any combination of these types of
securities at the sole discretion of the investment adviser,
subject only to the investment objectives of the Fund and the
policies adopted by the Board of Trustees. The investment adviser
determines the proportion of Fund assets invested in equity, debt
and money market securities based on fundamental value analysis;
analysis of historical long term returns among equity, debt and
money market investments; and other market influencing factors.
The fundamental value analysis considers the adviser's outlook
over both the near and long-term, for corporate profitability,
short and long-term interest rates, stock price earnings ratios
for the market in total and individual stocks and inflation
rates. When the investment climate as indicated by the
fundamental factors is near historical relationships, the
portfolio will be structured approximately 63% in equity, 30% in
debt and 7% in money market securities. In addition, market
influencing factors relating to monetary policy, equity momentum,
market sentiment, economic influences and market cycles are taken
into consideration in making the asset allocation decision.
<PAGE>
Deviations from historical fundamental market relationships
on either a current or anticipated basis, along with the
influences of market factors, may result under most foreseeable
circumstances in changes as much as 40%, plus or minus, in the
percentages allocated to equity, debt or money market securities
within the Fund's portfolio.
Equity Securities
In its equity investments, the Fund emphasizes a combination
of several themes in order to diversify its investment exposure.
Most stocks purchased by the Fund display one or more of the
following criteria:
Low price earnings ratios in relation to their return
on equity.
High asset values in relation to stock price.
Foreign shares, listed on the New York or American
Stock Exchanges or purchased in the form of American Depository
Receipts, of companies judged to represent better fundamental
value than those of similar domestic companies.
A high level of dividend payment providing a yield that
is competitive with debt investments.
Debt Securities
The Fund may invest in rated or unrated debt securities,
including obligations of the U.S. Government and its agencies and
corporate debt obligations. The Fund's corporate debt security
investments will consist primarily of "investment grade"
corporate bonds; that is, bonds rated BBB or higher by Standard &
Poor's or Baa or higher by Moody's or that are unrated but
considered by the investment adviser to be of equivalent credit
quality. Up to 25% of the Fund's fixed-income assets, however,
may be invested in debt securities that are below investment
grade as defined above. Non-investment grade (high-risk) debt
securities are considered to have speculative characteristics.
These investments are subject to greater market fluctuations and
risk of loss of income and principal than are investments in
lower yielding fixed-income securities.
High-yield (high-risk) bonds generally include any bonds
rated Ba or below by Moody's or BB or below by Standard & Poor's
or, if unrated, considered equivalent thereof by the Fund's
investment adviser. Bonds rated Ba or BB or below are considered
speculative. The Fund may invest up to 25% of the value of its
debt portfolio in bonds so rated (or unrated but considered of
equivalent quality). Bonds rated Ca or C are described by the
rating agencies as "speculative in a high degree; often in
default or [having] other marked shortcomings." Bonds rated C or
D generally are in default or arrears and are described as having
extremely poor prospects of attaining any real investment
standings. As of January 31, 1996, the Fund held long-term debt
securities rated as follows:
<TABLE>
<CAPTION>
Moody's/Standard & Poor's % of Long-Term Debt
<S> <C>
Aaa/AAA .......................... 79.3%
Aa/AA ............................ 0.0%
A/A .............................. 12.9%
Baa/BBB .......................... 3.8%
Less than investment grade........ 4.0%
</TABLE>
See the Appendix for a description of corporate bond ratings.
For a more complete discussion of the risk factors
associated with high-yield bonds, see the discussion below under
"Principal Risk Factors," and "Certain Risk Factors Relating to
High-Yield, High-Risk Bonds" in the Statement of Additional
Information.
The adviser anticipates that average maturity will not
exceed 15 years, with the precise term to maturity dependent upon
general market and economic conditions.
<PAGE>
Money Market Instruments
The Fund may at any time be 100% invested in money market
instruments although it likely will invest in these securities
only temporarily pending investment in equity and debt
securities, or on a limited basis. The securities described below
are considered money market instruments if their remaining
maturities are less than 13 months.
Repurchase Agreements. A repurchase agreement is a
transaction where a Fund buys a security at one price and
simultaneously agrees to sell that same security back to the
original owner at a higher price. The investment adviser, on
behalf of the Board of Trustees, reviews the credit worthiness of
the other party to the agreement and must find it satisfactory
before engaging in a repurchase agreement. Thereafter, the
investment adviser, on behalf of the Board of Trustees, monitors
the borrower to ensure that adequate credit standards continue to
be met. It is the policy of the Fund to require that repurchase
agreements be fully collateralized at all times. A majority of
repurchase agreements mature in seven days or less. In the event
of the default or bankruptcy of the other party, the Fund could
experience delays in recovering its money, may realize only a
partial recovery or even no recovery, and may also incur
disposition costs.
U.S. Government Obligations. Securities issued and
guaranteed as to principal and interest by the U.S. Government
include a variety of Treasury securities that differ only in
their interest rates, maturities and times of issuance. At
issuance, Treasury bills have a maturity of one year or less;
Treasury notes have maturities of one to seven years; and
Treasury bonds generally have a maturity of greater than five
years.
Government Agency Securities. Government agency securities
that are permissible investments consist of securities either
issued or guaranteed by agencies or instrumentalities of the U.S.
Government. Agencies of the U.S. Government that issue or
guarantee obligations include, among others, Export-Import Banks
of the United States, Farmers Home Administration, Federal
Housing Administration, Government National Mortgage Association,
Maritime Administration, Small Business Administration and The
Tennessee Valley Authority. Obligations of instrumentalities of
the U.S. Government include securities issued or guaranteed by,
among others, the Federal National Mortgage Association, Federal
Home Loan Banks, Federal Home Loan Mortgage Corporation, Federal
Intermediate Credit Banks, Banks for Cooperatives and the U.S.
Postal Service. Some of these securities, such as those
guaranteed by the Government National Mortgage Association, are
supported by the full faith and credit of the U.S. Treasury;
others, such as those issued by The Tennessee Valley Authority,
are supported by the right of the issuer to borrow from the
Treasury; while still others, such as those issued by the Federal
Land Banks, are supported only by the credit of the
instrumentality.
Certificates of Deposit. Certificates of deposit are
generally short-term, interest-bearing negotiable certificates
issued by banks or savings and loan associations against funds
deposited in the issuing institution.
Time Deposits. Time deposits are deposits in a bank or other
financial institution for a specified period of time at a fixed
interest rate for which no negotiable certificate is received.
Bankers' Acceptances. Bankers' acceptances are time drafts
drawn on commercial banks by borrowers usually in connection with
international commercial transactions (to finance the import,
export, transfer or storage of goods). The borrower is liable for
payment as well as the bank that unconditionally guarantees to
pay the draft at its face amount on the maturity date. Most
acceptances have maturities of six months or less and are traded
in secondary markets prior to maturity.
Commercial Paper. Commercial paper consists of unsecured
promissory notes issued by corporations to finance short-term
credit needs. Commercial paper is issued in bearer form with
maturities generally not exceeding nine months. Commercial paper
obligations may include variable amount master demand notes.
<PAGE>
Variable amount master demand notes are obligations that permit
the investment of fluctuating amounts by the Fund at varying
rates of interest pursuant to direct arrangements between the
Fund, as lender, and the borrower. These notes permit daily
changes in the amounts borrowed. The Fund has the right to
increase the amount under the note at any time up to the full
amount provided by the note agreement, or to decrease the amount,
and the borrower may prepay up to the full amount of the note
without penalty. Because variable amount master demand notes are
direct lending arrangements between the lender and borrower, it
is not generally contemplated that such instruments will be
traded, and there is no secondary market for these notes,
although they are redeemable (and thus immediately repayable by
the borrower) at face value, plus accrued interest, at any time.
In connection with master demand note arrangements, Carillon
Advisers, Inc. will monitor on an ongoing basis the earning
power, cash flow, and other liquidity ratios of the issuer, and
the borrower's ability to pay principal and interest on demand.
While master demand notes, as such, are not typically rated by
credit rating agencies, if not so rated the Fund may invest in
them only if at the time of an investment the issuer meets the
criteria for other commercial paper issuers. Because master
demand notes are immediately repayable by the borrower on demand,
they are considered by the Fund to have a maturity of one
business day.
Corporate Debt Securities. Corporate debt securities with a
remaining maturity of less than one year tend to become extremely
liquid and are traded as money market securities. Such issues
with between one and two years remaining to maturity tend to have
greater liquidity and considerably less market value fluctuations
than longer-term issues.
Other Information
In addition to the investment policies described above, the
Fund's investments are subject to further restrictions described
in the Statement of Additional Information. Unless otherwise
specified, the Fund's investment objectives, policies and
restrictions are not fundamental policies and may be changed
without shareholder approval.
PRINCIPAL RISK FACTORS
The Fund's investment objectives involve the assumption of
reasonable risks which include financial and market risks and
current income volatility. Financial risk refers to the ability
of an issuer of a debt security to pay principal and interest on
that security and to the earnings stability and overall financial
soundness of an issuer of an equity security. Market risk refers
to the fluctuation in the price of the security because of
changes in conditions in the securities markets in general and,
with respect to debt securities, changes in the overall level of
interest rates. Current income volatility refers to the degree
and rapidity with which changes in the overall level of interest
rates become reflected in the level of current income of the
Fund.
The Fund is subject to varying degrees of financial and
market risks and current income volatility because it invests in
a variety of investments at the adviser's discretion. The market
value of debt securities is affected by changes in general market
interest rates. If interest rates fall, the market value of these
securities tends to rise; but if interest rates rise, their value
tends to fall. Market risk affects all debt securities, but
lower-rated and unrated securities may be subject to a greater
market risk than higher-rated (lower-yield) securities. Equity
securities are subject to potentially wide variations in value
because of activity in the primary markets on which such
securities are traded. Lower-rated securities are generally
subject to greater financial risk than higher-rated securities as
there is a greater probability that issuers of lower-rated
securities will not be able to pay the principal and interest due
on such securities, especially during periods of adverse economic
conditions.
Bonds rated below the four highest grades used by Standard &
Poor's or Moody's are frequently referred to as "junk" bonds,
reflecting the greater market and investment risks associated
with such bonds. Such risks relate not only to the greater
financial weakness of the issuers of such securities but also to
other factors including: (i) the sensitivity of such securities
to interest rates and economic changes (high-yield, high-risk
bonds are very sensitive to adverse economic and corporate
developments; their yields will fluctuate over time and either an
economic downturn or rising interest rates could create financial
stress on the issuers of such bonds, possibly resulting in their
defaulting on their obligations); (ii) the payment expectations
of holders of such securities (high-yield, high-risk bonds may
contain redemption or call provisions which if exercised in a
period of lower interest rates would result in their being
replaced by lower yielding securities); (iii) the liquidity of
such securities (there may be little trading in certain high-yield,
high-risk bonds which may make it more difficult to
dispose of the securities and more difficult to determine their
fair value). See "Certain Risk Factors Relating to High-Yield,
High-Risk Bonds" in the Statement of Additional Information for a
further discussion of the risks summarized above.
The Fund is subject to the further risk that in order to
meet its objectives, the adviser must determine the proper mix of
equity, debt and money market securities. Moreover, the timing of
movements from one type of security to another could have a
negative effect on the Fund's overall objective. Inherent in the
fact that the adviser has great latitude with respect to the
Fund's portfolio composition is the risk that it may not properly
ascertain the appropriate mix of securities for any particular
economic cycle.
MANAGEMENT OF THE TRUST
Trustees
The Board of Trustees is responsible for supervising the
business affairs and investments of the Fund that are managed on
a daily basis by the Fund's investment adviser. The role of the
Trustees is not to approve specific investments, but to exercise
a control and review function.
Investment Adviser
Carillon Advisers, Inc. ("Adviser") serves as the Trust's
investment adviser under an Investment Advisory Agreement
("Agreement") originally dated December 30, 1987. Adviser, whose
principal business address is 1876 Waycross Road, Cincinnati,
Ohio 45240 (P.O. Box 40407, Cincinnati, Ohio 45240), was
incorporated under the laws of Ohio on August 18, 1986, as
successor to the advisory business of Carillon Investments, Inc.
Adviser is a wholly-owned subsidiary of The Union Central Life
Insurance Company ("UC"), a mutual life insurance company
organized in 1867 under the laws of Ohio. Adviser is also the
investment adviser of The Manhattan Life Insurance Company (with
assets of approximately $514 million as of December 31, 1995),
which is 73% owned by UC. Adviser is also the investment adviser
of Carillon Fund, Inc., a registered open-end management
investment company. George L. Clucas has been primarily
responsible for the day-to-day management of the Fund's portfolio
since 1988. Mr. Clucas is Trustee, President and Chief Executive
Officer of the Fund, and President and Chief Executive Officer of
the Adviser. He has been affiliated with the Adviser and UC
since 1987.
The Agreement provides that, subject to the control and
direction of the Board of Trustees, Adviser will manage the
investment and reinvestment of the assets of the Fund in
accordance with its investment objectives and policies. In
addition, Adviser agrees to formulate and implement a continuing
program for the management of the Fund's assets. Adviser's
obligations include the making and execution of all investment
decisions, and the placement of orders for the purchase and sale
of securities with or through such brokers, dealers or issuers as
Adviser may select.
Adviser is also required by the Agreement to furnish or
provide to the Fund any necessary office space, equipment and
personnel, clerical services, and other necessary office
expenses, and provide the services of individuals who perform
executive and administrative functions for the Fund. In order to
fulfill these obligations, Adviser has entered into an
Administration Agreement with Carillon Investments, Inc. to
furnish such services for which Adviser pays Carillon
Investments, Inc. an annual fee equal to .20% of the Fund's
average net assets. This fee does not increase the obligation of
the Fund in any way.
<PAGE>
Advisory Fee
Pursuant to the Agreement between the Fund and Adviser, the
Fund pays Adviser, as full compensation for all facilities and
services furnished, a fee based on its average net assets. The
fee, accrued daily and paid monthly, is computed at the annual
rate of .75% of the first $50,000,000, .65% of the next
$100,000,000, and .50% of all amounts over $150,000,000 of the
current value of the net assets of the Fund. The initial advisory
fee is higher than that charged most other funds, but management
believes it to be standard with regard to other comparable funds.
Because the fee is reduced (first reduction at $50,000,000), it
precisely recognizes "economies of size" and the fixed costs
associated with managing any fund. It gives early recognition to
the value of an increase in net assets.
Service Agreement
Under a Service Agreement between the Adviser and UC, UC has
agreed to make available to the Adviser the services of certain
employees of UC on a part-time basis for the purpose of better
enabling the Adviser to fulfill its obligations to the Trust
under the Agreement. Pursuant to the Service Agreement, the
Adviser shall reimburse UC for all the costs allocable to the
time spent on the affairs of the Adviser by the employees
provided by UC. In performing their services for the Adviser
pursuant to the Service Agreement, the specified employees shall
report and be solely responsible to the officers and directors of
the Adviser or persons designated by them. UC shall have no
responsibility for the investment recommendations or decisions of
the Adviser. The obligation of performance under the Agreement is
solely that of the Adviser and UC undertakes no obligation in
respect thereto except as otherwise expressly provided in the
Service Agreement. The Service Agreement was approved by the
shareholders at a meeting held on March 20, 1992.
Expenses
Adviser paid all of the fees and expenses incurred in the
organization and initial registration of the Trust and its shares
with the Securities and Exchange Commission and the various
states where offered.
The Fund incurs expenses that are accrued daily and
deducted from total income before dividends are paid. These
expenses include: the fee of Adviser, taxes, legal, transfer and
dividend disbursing agent, bookkeeping, custodian and auditing
fees, and other expenses relating to the Trust's operations that
are not expressly assumed by Adviser under its Investment
Advisory Agreement with the Trust. For the year ended October 31,
1995, expenses ($439,494) as a percentage of average net assets
($43,730,299) equalled 1.01%. (See "Fund Expenses," page 2.)
It is estimated that the Fund will have an annual portfolio
turnover rate of 75%. For the year ended October 31, 1995, the
actual portfolio turnover rate was 42.07%. Portfolio turnover
refers to the rate at which the securities held by the Fund are
replaced. The higher the rate, the higher the transactional and
brokerage costs associated with the turnover, unless the
securities traded can be bought and sold without corresponding
commission costs.
PURCHASE OF FUND SHARES
Principal Underwriter
Carillon Investments, Inc. ("Distributor"), whose address is
1876 Waycross Road, Cincinnati, Ohio 45240 (P.O. Box 40409,
Cincinnati, Ohio 45240), serves as the principal underwriter for
shares of the Trust. Distributor is a wholly-owned subsidiary of
UC. Pursuant to a Distribution Agreement with the Trust,
Distributor is obligated to pay certain expenses in connection
with the offering of shares, including sales commissions to its
representatives and fees to other broker-dealers offering the
Fund shares. Broker-dealers typically receive 90% of the sales
charge. The staff of the Securities and Exchange Commission is of
the opinion that broker-dealers receiving 90% or more of the
sales charge are considered underwriters under the Securities Act
of 1933. Distributor also pays for the printing and distribution
of prospectuses, sales literature and advertising costs in
connection with the offering of Fund shares.
<PAGE>
How Shares May Be Purchased
The Trust continuously offers the shares of the Fund at the
public offering price which is the net asset value per share next
computed after receipt by the transfer agent of an order to
purchase, plus a sales charge. An application form for the
purchase of Fund shares is included with this Prospectus or can
be obtained from Distributor or from a broker-dealer which has
entered into a selling agreement with Distributor. The initial
purchase order must be placed through the Distributor or one of
these brokers; subsequent purchases may be made through the
broker or Distributor, by mail or through an automatic deduction
from the shareholder's checking account. The broker-dealers and
the Distributor are responsible for the prompt forwarding of
orders to the transfer agent. If the purchase order is received
by the transfer agent before 4:00 p.m., Eastern Time, on a
trading day, the shares will be purchased at the net asset value
per share determined at 4:00 p.m., Eastern Time, on that day.
Purchase orders received after 4:00 p.m., Eastern Time, will be
executed at the net asset value determined at 4:00 p.m., Eastern
Time, on the next trading day. The initial investment must be at
least $500 and subsequent investments must be at least $50. The
Trust has the unqualified right not to accept a specific order
for the purchase of shares. A $15 service charge will be
assessed for all returned checks due to insufficient funds or
closed accounts.
The application form for the purchase of Fund shares
requires certain elections to be made by the shareholder if
he/she anticipates making subsequent purchases by bank wire ($500
minimum), by check or by automatic monthly deductions ($100
minimum) from his/her checking account. Third party checks for
investment into mutual fund accounts will no longer be accepted;
this refers to checks that are made payable to someone other than
the registered account owner and endorsed over to a particular
mutual fund. If the appropriate election is made, money can be
wired to the transfer agent by the shareholder's bank for the
purchase of Fund shares. The shareholder's bank must be a member
of the Federal Reserve System. It is likely that the
shareholder's bank will impose a fee for this privilege. Of
course, the shareholder may send subsequent payments directly to
the transfer agent: Firstar Trust Company, Mutual Fund Services,
P.O. Box 701, Milwaukee, Wisconsin 53201-0701. Whenever placing
an order, the shareholder must give his/her account number. (See
"Note" page 13.)
If there is a question concerning the purchase of shares,
contact the Distributor or your broker.
Sales Charge
A sales charge is deducted from investments in the Fund
shares. The amount of sales charge varies with the total amount
invested. The following is a table of sales charges applied
against investment in shares.
<TABLE>
<CAPTION>
Percent of Percent of
Amount Invested Offering Price Net
Investment
- - ----------------------------------------------------------------
<S> <C> <C>
Less than $50,000 5% 5.26%
$50,000 but less than $150,000 4% 4.17%
$150,000 but less than $500,000 3% 3.09%
$500,000 but less than $1,500,000 2% 2.04%
$1,500,000 but less than $2,500,000 1% 1.01%
$2,500,000 or more .5% .50%
</TABLE>
For example, from the total investment (public offering
price) of $5,000, $250 would be deducted and the net amount
invested would be $4,750. This $250 represents 5% of the purchase
payment and 5.26% of the net amount invested.
Reduced Sales Charge
Shares of the Fund may be purchased at a reduced sales
charge under certain circumstances briefly described here.
Complete procedural details are given in the Statement of
Additional Information.
(a) LETTER OF INTENT: Shareholders who sign a Letter of
Intent will be permitted to aggregate their current investment in
the Trust with the subsequent investments they intend to make
over the next 13-month period in shares of the Fund.
<PAGE>
(b) RIGHT OF ACCUMULATION AND COMBINED ACCOUNTS: If
notified to do so by the shareholder at the time a purchase is
made, the Fund takes into account the current net asset value of
shares owned by the shareholder in addition to the dollar amount
of his or her new investment in determining the sales charge. The
Fund also will consider, if notified to do so, the current net
asset value of shares owned, or the aggregate dollar amount of
new investment in Fund shares being made by the shareholder's
spouse and/or children under the age of 21.
Purchases of Fund shares for qualified retirement plans
under section 401(a) of the Internal Revenue Code ("Code"), plans
adopted by public school systems and certain tax-exempt
organizations under section 403(b) of the Code, Individual
Retirement Arrangements purchased by or on behalf of individuals
pursuant to section 408 of the Code, and government deferred
compensation plans pursuant to section 457 of the Code will not
be subject to the sales charge.
Purchases of the Fund shares by Distributor, or companies
affiliated with Distributor, and by directors, officers and
employees of Distributor or affiliated companies will not be
subject to the sales charge. Fund shares purchased by the spouse
and/or children under the age of 21 of the directors, officers
and employees of the Distributor or such affiliated companies
also will not be subject to the sales charge.
Determining Net Asset Value
The net asset value of the shares of the Fund is determined
once daily, Monday through Friday at 4:00 p.m., Eastern Time, on
days there are purchases or redemptions of Fund shares, except
when the New York Stock Exchange is closed (currently New Year's
Day, President's Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day), the day
following Thanksgiving Day, December 24, 1996, and any day on
which changes in the value of the portfolio securities of the
Fund will not materially affect the current net asset value of
its shares. Such determination is made by adding the values of
all securities and other assets of the Fund, subtracting
liabilities and expenses, and dividing the resulting figure by
the number of shares of the Fund outstanding. Expenses, including
the advisory fee payable to Adviser, are accrued daily.
Securities held by the Fund, except for money market
instruments maturing in 60 days or less, are valued as follows:
(a) securities traded on stock exchanges (including securities
traded in both the over-the-counter market and on an exchange) or
listed on the NASDAQ National Market System, are valued at the
last sales price as of the close of the New York Stock Exchange
on the day the securities are being valued, or, lacking any
sales, at the last bid prices: (b) securities traded only in the
over-the counter market that are not part of the NASDAQ National
Market System are valued at the last bid prices quoted by brokers
that make markets in the securities at the close of trading on
the New York Stock Exchange; and (c) securities and assets for
which market quotations are not readily available are valued at
fair value as determined in good faith by, or under procedures
adopted by, the Board of Trustees. Money market instruments
maturing in 60 days or less are valued pursuant to the amortized
cost method.
Shareholder Accounts
When shares are initially purchased, an account is
automatically established for the shareholder. Any shares that
are subsequently purchased or received as a distribution will be
credited directly to the shareholder's account. No certificates
are issued.
REDEMPTION OF SHARES
Fund shares can be disposed of and cash received by sending
a written request for redemption to Firstar Trust Company, Mutual
Fund Services, P.O. Box 701, Milwaukee, Wisconsin 53201-0701, or
by telephone or telegraphic request to Firstar at 1-800-338-1579
if this option was elected on the shareholder's application form.
<PAGE>
Upon receipt of a written request for redemption in "good
order" as described below, a check will be forwarded by Firstar,
as transfer agent for the Trust, equal to the amount of the net
asset value of the redeemed shares next determined after the
redemption request has been received. If the request for
redemption is received by Firstar before 4:00 p.m., Eastern Time,
the shares will be redeemed at the net asset value per share
determined at 4:00 p.m., Eastern Time, on that day. Requests for
redemption received by the transfer agent after 4:00 p.m.,
Eastern Time, will be executed at the net asset value determined
at 4:00 p.m., Eastern Time, on the next trading day.
The check normally will be forwarded immediately after
redemption. However, the Trust reserves the right to take up to
seven days to make payment. The proceeds of the redemption may be
more or less than the original cost. This is particularly true
when redemption is sought shortly after investment where a sales
charge was deducted from the investment. If the shares to be
redeemed were paid for by check (including certified or cashier's
checks), to allow clearance, the proceeds from the redemption
request will not be disbursed until 15 days after the receipt of
such payment.
A written redemption request will be considered to be
received in "good order" only if:
1. The number of shares to be redeemed and the shareholder
account number is indicated in writing;
2. The written request is signed by the registered owner
and by any co-owner of the account in exactly the same name or
names used in establishing the account; and
3. The signatures on the written redemption request for
amounts in excess of $10,000 are guaranteed by a national bank, a
state bank (not including a savings bank), a trust company,
Distributor, or by a member firm of the New York, American,
Boston, Midwest, Pacific or Philadelphia Stock Exchanges.
If requested on the original application for a Fund account,
telephone or telegraphic instructions for redemption will be
honored with the following restrictions: (a) Requests for
redemption to be paid by Fed wire must be in an amount of at
least $1,000 and will be sent only to the bank and account stated
in the application. The shareholder's bank must be a member of
the Federal Reserve System. A charge of $7.50 is imposed for Fed
wires. This charge is set and may be changed by Firstar. (b)
Telephone redemption requests must be less than $10,000 and will
be mailed only to the account address appearing on the Fund's
records. Redemptions will be priced at the next calculated net
asset value after receipt of the request by the transfer agent.
(See "Determining Net Asset Value," page 11.)
Telephone redemption requests may be made by calling the
transfer agent at 1-800-338-1579 between the hours of 9:00 a.m.
and 8:00 p.m., Eastern Time, on Monday through Friday (excepting
holidays). The transfer agent will need to know the shareholder's
name, account number, and either the number of shares or the
dollar amount to be redeemed.
Other supporting legal documents may be required from
corporations or other organizations, fiduciaries or persons other
than the shareholders of record making the request for
redemption.
The Trust has the right to suspend redemption or payment at
times when the New York Stock Exchange is closed (other than
customary weekend or holiday closings) or during periods of
emergency or other periods as permitted by the Securities and
Exchange Commission. In the case of any such suspension, the
request for redemption may be withdrawn, or payment may be
received based upon the net asset value next determined after the
suspension is lifted.
Because of the high cost of maintaining small accounts, the
Trust may elect to close any account which, due to redemptions,
has a current value of less than $500 by redeeming all of the
shares in the account and mailing the proceeds to the shareholder
of record. If the Trust so elects, the shareholder will be
notified in writing that an account has a value of less than $500
and will be allowed 30 days in which to make an additional
investment in order to avoid having the account closed.
<PAGE>
Note
Shareholders are advised that during periods of drastic
economic or market changes, telephone and telegraphic procedures
may be difficult to implement. If a shareholder is unable to
place an order or request a redemption via the telephone or
telegraph, he should make a written request instead.
SHAREHOLDER VOTING
Under the Declaration of Trust, no annual and regular
meetings of shareholders are required. Shareholder meetings
ordinarily will not be held unless required by the Investment
Company Act of 1940. The Board of Trustees is a self-perpetuating
body and the Trustees will continue in their positions until they
resign, die, or are removed by a written agreement signed by at
least two-thirds of the remaining Trustees, by vote of the
shareholders of the Trust voting not less than two-thirds of the
shares then outstanding, cast in person or by proxy at any
meeting called for that purpose, or by a written declaration
signed by shareholders voting not less than two-thirds of the
shares then outstanding and filed with the Trust's custodian.
On any matter submitted to shareholders, shares of the Fund
entitle their holders to one vote per share (with proportionate
voting for fractional shares). When issued, the Fund's shares are
fully paid and nonassessable, have no preemptive or subscription
rights, and are fully transferable. There are no conversion
rights. Shares do not have cumulative voting rights, which means
that in situations in which shareholders elect Trustees, holders
of more than 50% of the shares voting for the election of
Trustees can elect 100% of the Trustees of the Trust and the
holders of less than 50% of the shares voting for the election of
Trustees will not be able to elect any Trustees. UC initially
invested $10 million in the Fund. UC is free to redeem its
investment at any time subject to retaining at least $100,000 in
the Fund.
In addition to UC's own investment, shares of the Fund are
sold to the trustees of certain UC employee benefit plans to fund
retirement benefits for UC's employees. As of January 31, 1996,
UC and UC's plan trustees owned 34.10% and 42.97%, respectively,
of Fund shares, and consequently, UC has voting control of the
Trust.
SHAREHOLDER LIABILITY
Under Massachusetts law, the shareholders of the Trust
could, under certain circumstances, be held personally liable for
the obligations of the Trust. However, the Declaration of Trust
disclaims shareholder liability for acts or obligations of the
Trust and indicates that notice of such disclaimer can be given
in each agreement, obligation or instrument entered into or
executed by the Board of Trustees or a Trustee. The Declaration
of Trust provides for indemnification from the Trust property for
all losses and expenses of any shareholder held personally liable
for the obligations of the Trust. Thus, the risk of a shareholder
incurring financial loss on account of shareholder liability is
limited to circumstances in which the Trust itself would be
unable to meet its obligations.
DIVIDENDS AND DISTRIBUTIONS
It is the intention of the Fund to distribute quarterly
substantially all of its net investment income, if any. For
dividend purposes, net investment income of the Fund consists of
all dividends or interest earned by the Fund less expenses
(including the investment advisory fee). All net realized capital
gains, if any, of the Fund are distributed periodically, no less
frequently than annually. All dividends and capital gains
distributions are automatically reinvested in additional shares
at net asset value unless the shareholder requests such dividends
and distributions be paid in cash.
<PAGE>
TAXES
Under the Internal Revenue Code, the Fund intends to elect
and qualify as a regulated investment company. As a regulated
investment company, the Fund will not be subject to federal
income tax on net investment income and capital gains, if any,
that it distributes to its shareholders if at least 90% of its
net investment income and net short-term capital gains for the
taxable year is distributed, but will be subject to tax at
regular corporate rates on any income or gains that are not
distributed.
Payments of dividends to shareholders that are not out of
net long-term capital gains and that do not exceed the current or
accumulated income of the Fund are taxable as ordinary income in
the tax year of the shareholder in which the dividend is paid,
whether paid in cash or reinvested in shares. A portion of the
dividends paid by the Fund will be eligible for the 70%
dividends-received deduction allowed to corporations. The portion
generally will be equal to the proportion that the Fund's
dividends from U.S. corporations bear to the Fund's gross income.
A 4% nondeductible excise tax will be imposed to the extent
the Fund does not distribute at least 98% of its ordinary income
earned during the calendar year and 98% of its net capital gains
(both long- and short-term) earned during its taxable year by the
end of the calendar year. For purposes of the 4% excise tax,
dividends and distributions will be treated as paid when actually
distributed, except that dividends declared in December payable
to shareholders of record on a specified date in December, and
paid before February 1 of the following year, will be treated as
having been (i) paid on the record date, and (ii) received by
each shareholder on such date. Under this rule, therefore, a
shareholder may be taxed in one year on dividends or
distributions actually received in January of the following year.
The Fund will send written notices to its shareholders
regarding the tax status of all distributions made during each
taxable year.
The Trust will be required to withhold 31% of any reportable
income payments made to a shareholder if the shareholder has not
provided an accurate taxpayer identification number, in a manner
as provided by the IRS, to the Trust or the IRS notifies the
Trust that a shareholder has not reported all interest and
dividend income required to be shown on the shareholder's federal
income tax return.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT
Firstar Trust Company, Mutual Fund Services, P.O. Box 701,
Milwaukee, Wisconsin 53201-0701, acts as Custodian of the Trust's
assets, and is its bookkeeping, transfer and dividend disbursing
agent.
SHAREHOLDER INQUIRIES
Shareholder inquiries should be directed to P.O. Box 701,
Milwaukee, Wisconsin 53201-0701, or may be made by calling
1-800-338-1579.
STATEMENT OF ADDITIONAL INFORMATION
A copy of the Statement of Additional Information that
provides more detailed information about the Trust is available
upon request. The Table of Contents of this Statement follows.
<PAGE>
TABLE OF CONTENTS
STATEMENT OF ADDITIONAL INFORMATION
Page
The Trust................................................... 2
Investment Policies......................................... 3
Money Market Instruments and Investment Techniques........ 3
Investment Restrictions..................................... 7
Portfolio Turnover.......................................... 9
Management of the Trust ................................... 10
Compensation Table....................................... 12
Investment Adviser......................................... 12
Approval of the Agreement................................ 12
Responsibilities of the Adviser.......................... 13
Trust Expenses........................................... 13
Advisory Fee............................................. 14
Administration........................................... 14
Brokerage Allocation..................................... 14
Other Clients of the Adviser............................. 15
Determination of Net Asset Value........................... 16
Performance................................................ 17
Distribution of Shares..................................... 18
Purchase and Redemption of Shares.......................... 18
Sales Charge............................................. 18
Qualifying for a Reduced Sales Charge.................... 18
Redemptions.............................................. 19
Taxes...................................................... 20
Custodian, Transfer and Dividend Disbursing Agent.......... 20
Additional Information..................................... 21
Independent Auditors ................................ 21
<PAGE>
<PAGE>
APPENDIX
CORPORATE BOND RATINGS
Moody's Investors Services, Inc.
Aaa--Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and
are generally referred to as "gilt-edge." Interest payments are
protected by a large or by an exceptionally stable margin and
principal is secure. While the various protective elements may
change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.
Aa--Bonds which are rated Aa are judged to be high quality
by all standards. Together with the Aaa group they comprise what
are generally known as high-grade bonds. They are rated lower
than the best bonds because margins of protection may not be as
large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger
than in Aaa securities.
A--Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium-grade
obligations. Factors giving security to principal and interest
are considered adequate but elements may be present which suggest
a susceptibility to impairment sometime in the future.
Baa--Bonds which are rated Baa are considered as medium-grade
obligations, i.e., they are neither highly protected nor
poorly secured. Interest payments and principal security appear
adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as
well.
Ba--Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be
very moderate and thereby not well safeguarded during both good
and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B--Bonds which are rated B generally lack characteristics of
the desirable investment. Assurance of interest and principal
payment or of maintenance of other terms of the contract over any
long period of time may be small.
Caa--Bonds which are rated Caa are of poor standing. Such
issues may be in default or there may be present elements of
danger with respect to principal or interest.
Ca--Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default
or have other marked shortcomings.
Standard & Poor's Corporation
AAA--This is the highest rating assigned by Standard &
Poor's to a debt obligation and indicates an extremely strong
capacity to pay principal and interest.
AA--Bonds rated AA also qualify as high-quality debt
obligations. Capacity to pay principal and interest is very
strong, and in the majority of instances they differ from AAA
issues only in a small degree.
A--Bonds rated A have a strong capacity to pay principal and
interest, although they are somewhat more susceptible to the
adverse of changes in circumstances and economic conditions.
<PAGE>
BBB--Bonds rated BBB are regarded as having adequate
capacity to pay principal and interest. Whereas they normally
exhibit protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened
capacity to pay principal and interest for bonds in this category
than for bonds in the A category.
BB-B-CCC-CC--Bonds rated BB, B, CCC, and CC are regarded, on
balance, as predominately speculative with the respect to the
issuer's capacity to pay interest and repay principal in
accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of
speculation. While such bonds will likely have some quality and
protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.
COMMERCIAL PAPER RATINGS
Moody's Investors Services, Inc.
A Prime rating is the highest commercial paper rating
assigned by Moody's Investors Services, Inc. Issuers rated Prime
are further referred to by use of numbers 1, 2 and 3 to denote
relative strength within this highest classification. Among the
factors considered by Moody's in assigning ratings for an issuer
are the following: (1) management; (2) economic evaluation of
the industry and an appraisal of speculative type risks which may
be inherent in certain areas; (3) competition and customer
acceptance of products; (4) liquidity; (5) amount and quality of
long-term debt; (6) ten-year earnings trends; (7) financial
strength of a parent company and its relationship with the
issuer; and (8) recognition by management of obligations which
may be present or may arise as a result of public interest
questions and preparations to meet such obligations.
Standard & Poor's Corporation
Commercial paper rated A by Standard & Poor's Corporation
has the following characteristics: Liquidity ratios are better
than the industry average. Long-term senior debt rating is "A"
or better. In some cases, BBB credits may be acceptable. The
issuer has access to at least two additional channels of
borrowing. Basic earnings and cash flow have an upward trend
with allowance made for unusual circumstances. Typically, the
issuer's industry is well established, the issuer has a strong
position within its industry and the reliability and quality of
management is unquestioned. Issuers rated A are further referred
to by use of numbers 1, 2 and 3 to denote relative strength
within this classification.
<PAGE>
(these two pages are actually set up as one page with two
columns - the Prospectus is folded is half, with this page
serving as the front and back - the left side (back) is as
follows)
TABLE OF CONTENTS
Page
Fund Expenses....................... 2
Financial Highlights................ 3
Performance......................... 4
The Trust........................... 4
The Fund............................ 4
Investment Objectives and Policies.. 4
Equity Securities................. 5
Debt Securities................... 5
Money Market Instruments.......... 6
Other Information................. 7
Principal Risk Factors.............. 7
Management of the Trust............. 8
Trustees.......................... 8
Investment Adviser................ 8
Advisory Fee...................... 9
Service Agreement................. 9
Expenses.......................... 9
Purchase of Fund Shares............. 9
Principal Underwriter............. 9
How Shares May Be Purchased....... 10
Sales Charge...................... 10
Reduced Sales Charge.............. 10
Determining Net Asset Value....... 11
Shareholder Accounts.............. 11
Redemption of Shares................ 11
Shareholder Voting.................. 13
Shareholder Liability............... 13
Dividends and Distributions......... 13
Taxes............................... 14
Custodian, Transfer and
Dividend Disbursing Agent......... 14
Shareholder Inquiries............... 14
Statement of Additional Information. 14
Table of Contents of Statement
of Additional Information......... 15
Appendix
Corporate Bond Ratings............ 16
Commercial Paper Ratings.......... 17
<PAGE>
(this is the cover side (right side) -
alongside the left tow-thirds of the page
and next to the fund identification there
is a graphic of a carillon tower)
CARILLON
--------
CAPITAL
--------
FUND
--------
Carillon
Investment Trust
1876 Waycross Road
Cincinnati, Ohio 45240
- - ---------------------------------------------
PROSPECTUS
- - ---------------------------------------------
INVESTMENT ADVISER
Carillon Advisers, Inc.
1876 Waycross Road
Cincinnati, Ohio 45240
- - ---------------------------------------------
DISTRIBUTOR
Carillon Investments, Inc.
1876 Waycross Road
Cincinnati, Ohio 45240
- - ---------------------------------------------
Dated February 28, 1996
CIT 432 2-96
<PAGE>
PART B
INFORMATION REQUIRED IN A
STATEMENT OF ADDITIONAL INFORMATION
<PAGE>
CARILLON INVESTMENT TRUST
STATEMENT OF ADDITIONAL INFORMATION
February 28, 1996
This Statement of Additional Information is not a
prospectus. Much of the information contained in this Statement
of Additional Information expands upon subjects discussed in the
Prospectus for Carillon Capital Fund. Accordingly, this
Statement should be read in conjunction with the Prospectus,
dated February 28, 1996, that may be obtained by calling the
Trust at (513) 595-2600, or writing the Trust at P.O. Box 40409,
Cincinnati, Ohio 45240.
TABLE OF CONTENTS
Page
The Trust............................................ 2
Investment Policies.................................. 3
Money Market Instruments and Investment Techniques. 3
Investment Restrictions.............................. 7
Portfolio Turnover................................... 9
Management of the Trust.............................. 10
Compensation Table................................. 12
Investment Adviser................................... 12
Approval of the Agreement.......................... 12
Responsibilities of the Adviser.................... 13
Trust Expenses..................................... 13
Advisory Fee....................................... 14
Administration..................................... 14
Brokerage Allocation............................... 14
Other Clients of the Adviser....................... 15
Determination of Net Asset Value..................... 16
Performance.......................................... 17
Distribution of Shares............................... 18
Purchase and Redemption of Shares.................... 18
Sales Charge....................................... 18
Qualifying for a Reduced Sales Charge.............. 18
Redemptions........................................ 19
Taxes................................................ 20
Custodian, Transfer and Dividend Disbursing Agent.... 20
Additional Information............................... 21
Independent Auditors ......................... 21
CIT 444 2-96
<PAGE>
THE TRUST
Carillon Investment Trust ("Trust") is registered with the
Securities and Exchange Commission under the Investment Company
Act of 1940 ("1940 Act") as a diversified, open-end management
investment company. The Trust was organized on December 8, 1986,
pursuant to a Declaration of Trust under the laws of the
Commonwealth of Massachusetts, as a voluntary association known
as a "Massachusetts business trust." It operated as a "series
company," as that term is used in Rule 18f-2 under the 1940 Act.
The Trust originally had three series: the Carillon Capital Fund
("Fund"), the Carillon Growth Stock Fund ("Growth Fund") and the
Carillon U.S. Government Securities Fund ("U.S. Securities
Fund"). On February 22, 1989, The Union Central Life Insurance
Company ("UC"), the sole shareholder of the Growth Fund and the
U.S. Securities Fund, voted to dissolve these funds.
Consequently, the Trust is now composed only of Carillon Capital
Fund, whose shares are currently being sold.
UC, an insurance company organized under the laws of Ohio,
provided the initial capital for the Fund by purchasing one
million shares. UC is free to redeem its investment at any time,
subject to retaining at least $100,000 in the Fund. The
principal business address of UC is 1876 Waycross Road,
Cincinnati, Ohio 45240 (P.O. Box 40888, Cincinnati, Ohio 45240).
In addition to UC's own investment, shares of the Fund are
sold to the trustees of certain UC employee benefit plans to
fund retirement benefits for UC's employees. As of January 31,
1996, UC and UC's plan trustees owned 34.10% and 42.97%,
respectively, of Fund shares, and, consequently, UC has voting
control of the Trust.
As described under "Shareholder Voting" in the Prospectus
for the Fund, the Declaration of Trust provides that no annual or
regular meetings of shareholders are required. In addition,
after the Trustees were initially elected by shareholders, the
Trustees became a self-perpetuating body. Thus, there ordinarily
will be no shareholder meetings unless otherwise required by the
1940 Act.
The 1940 Act specifically requires that a shareholder
meeting be held for the purpose of electing Trustees if at any
time less than a majority of the Trustees has been elected by the
shareholders of the Trust. The shareholders also have the power
to remove a Trustee by the affirmative vote of the holders of not
less than two-thirds of the shares outstanding and entitled to
vote either by a declaration in writing filed with the custodian
or by votes cast in person or by proxy at a meeting called for
the purpose of removal. The Trustees will promptly call such a
meeting when requested to do so by the record holders of not less
than 10 percent of the outstanding shares.
Ten or more shareholders who have been shareholders for at
least six months preceding the date of application and who hold
in the aggregate either shares having a net asset value of at
least $25,000 or at least one percent of the outstanding shares,
whichever is less, may apply in writing to the Trustees stating
that they wish to communicate with other shareholders to obtain
signatures in order to request a meeting to remove a Trustee.
This application must be accompanied by the proposed
communication and form of the request that they wish to transmit.
The Trustees will, within five business days after receipt of
such application, either: (1) afford to the applicants access to
a list of the names and addresses of all shareholders; or (2)
inform such applicants as to the approximate number of
shareholders of record and the approximate cost of mailing to
them the proposed communication and request, and upon tender by
the applicants of the amount so determined, undertake to mail
such communications to shareholders of record.
The phrase "a majority of the outstanding voting securities"
of the Fund (or of the Trust) means the vote of the lesser of:
(1) 67% of the shares of the Fund (or the Trust) present at a
meeting if the holders of more than 50% of the outstanding shares
are present in person or by proxy; or (2) more than 50% of the
outstanding shares of the Fund (or the Trust).
INVESTMENT POLICIES
The following specific policies supplement the "Investment
Objectives and Policies" set forth in the Prospectus for the
Fund.
Money Market Instruments and Investment Techniques
The Fund may at any time be 100% invested in money market
instruments, subject only to its objective of highest total
return. These securities will only be considered money market
instruments if their remaining maturities are less than 13
months.
Repurchase Agreements A repurchase agreement is an instrument
under which the purchaser (i.e., the Fund) acquires ownership of
the obligation (the underlying security) and the seller (the
"issuer" of the repurchase agreement) agrees, at the time of
sale, to repurchase the obligation at a mutually agreed upon time
and price, thereby determining the yield during the purchaser's
holding period. This results in a fixed rate of return insulated
from market fluctuations during such period. The underlying
securities will only consist of securities in which the Fund may
otherwise invest. Repurchase agreements usually are for short
periods, normally under one week, and are considered to be loans
under the 1940 Act. Repurchase agreements will be fully
collateralized at all times and interest on the underlying
security will not be taken into account for valuation purposes.
Securities underlying repurchase agreements will be held by the
Trust's custodian.
If the issuer of the repurchase agreement defaults and does
not repurchase the underlying security, the Fund might incur a
loss if the value of the underlying security declines, and the
Fund might incur disposition costs in liquidating the underlying
security. In addition, if the issuer becomes involved in
bankruptcy proceedings, the Fund may be delayed or prevented from
obtaining the underlying security for its own purposes. In order
to minimize any such risk, the Fund will only engage in
repurchase agreements with recognized securities dealers and
banks determined to present minimal credit risk by Carillon
Advisers, Inc. on behalf of the Board of Trustees.
U.S. Government Obligations Securities issued and guaranteed as
to principal and interest by the U.S. Government include a
variety of Treasury securities that differ only in their interest
rates, maturities and times of issuance. At issuance, Treasury
bills have a maturity of one year or less; Treasury notes have
maturities of one to seven years; and Treasury bonds generally
have a maturity of greater than five years.
Government Agency Securities Government agency securities that
are permissible investments consist of securities either issued
or guaranteed by agencies or instrumentalities of the U.S.
Government. Agencies of the U.S. Government that issue or
guarantee obligations include, among others, Export-Import Banks
of the United States, Farmers Home Administration, Federal
Housing Administration, Government National Mortgage Association
("GNMA"), Maritime Administration, Small Business Administration
and The Tennessee Valley Authority. Obligations of
instrumentalities of the U.S. Government include securities
issued or guaranteed by, among others, the Federal National
Mortgage Association ("FNMA"), Federal Home Loan Banks, Federal
Home Loan Mortgage Corporation ("FHLMC"), Federal Intermediate
Credit Banks, Banks for Cooperatives, and the U.S. Postal
Service. Some of these securities, such as those guaranteed by
the Government National Mortgage Association, are supported by
the full faith and credit of the U.S. Treasury; others, such as
those issued by The Tennessee Valley Authority, are supported by
the right of the issuer to borrow from the Treasury; while still
others, such as those issued by the Federal Land Banks, are
supported only by the credit of the instrumentality. The Fund's
primary usage of these types of securities will be GNMA
certificates and FNMA and FHLMC mortgage-backed obligations which
are discussed in more detail below.
Certificates of Deposit Certificates of deposit are generally
short-term, interest-bearing negotiable certificates issued by
banks or savings and loan associations against funds deposited in
the issuing institution.
Time Deposits Time deposits are deposits in a bank or other
financial institution for a specified period of time at a fixed
interest rate for which no negotiable certificate is received.
Bankers' Acceptances Bankers' acceptances are time drafts drawn
on commercial banks by borrowers usually in connection with
international commercial transactions (to finance the import,
export, transfer or storage of goods). The borrower is liable
for payment as well as the bank that unconditionally guarantees
to pay the draft at its face amount on the maturity date. Most
acceptances have maturities of six months or less and are traded
in secondary markets prior to maturity.
Commercial Paper Commercial paper consists of unsecured
promissory notes issued by corporations to finance short-term
credit needs. Commercial paper is issued in bearer form with
maturities generally not exceeding nine months. Commercial paper
obligations may include variable amount master demand notes.
Variable amount master demand notes are obligations that permit
the investment of fluctuating amounts by the Fund at varying
rates of interest pursuant to direct arrangements between the
Fund, as lender, and the borrower. These notes permit daily
changes in the amounts borrowed. The Fund has the right to
increase the amount under the note at any time up to the full
amount provided by the note agreement, or to decrease the amount,
and the borrower may prepay up to the full amount of the note
without penalty. Because variable amount master demand notes are
direct lending arrangements between the lender and the borrower,
it is not generally contemplated that such instruments will be
traded, and there is no secondary market for these notes,
although they are redeemable (and thus immediately repayable by
the borrower) at face value, plus accrued interest, at any time.
In connection with master demand note arrangements, Carillon
Advisers, Inc. will monitor on an ongoing basis the earning
power, cash flow and other liquidity ratios of the issuer, and
the borrower's ability to pay principal and interest on demand.
While master demand notes, as such, are not typically rated by
credit rating agencies, if not so rated the Fund may invest in
them only if at the time of an investment the issuer meets the
criteria for all other commercial paper issuers. Because master
demand notes are immediately repayable by the borrower on demand,
they are considered by the Fund to have a maturity of one
business day.
Corporate Debt Securities Corporate debt securities with a
remaining maturity of less than one year tend to become extremely
liquid and are traded as money market securities. Such issues
with between one and two years remaining to maturity tend to have
greater liquidity and considerably less market value fluctuations
than longer-term issues.
GNMA Certificates GNMA certificates are mortgage-backed
securities representing part ownership of a pool of mortgage
loans on which timely payment of interest and principal is
guaranteed by the full faith and credit of the U.S. government.
GNMA certificates differ from typical bonds because principal is
repaid monthly over the term of the loan rather than returned in
a lump sum at maturity. Because both interest and principal
payments (including prepayments) on the underlying mortgage loans
are passed through to the holder of the certificate, GNMA
certificates are called "pass-through" securities.
Although the mortgage loans in the pool have maturities of
up to 30 years, the actual average life of the GNMA certificates
typically will be substantially less because the mortgages are
subject to normal principal amortization and may be prepaid prior
to maturity. Prepayment rates vary widely and may be affected by
changes in market interest rates. In periods of falling interest
rates, the rate of prepayment tends to increase, thereby
shortening the actual average life of the GNMA certificates.
Conversely, when interest rates are rising, the rate of
prepayment tends to decrease, thereby lengthening the actual
average life of the GNMA certificates. Accordingly, it is not
possible to predict accurately the average life of a particular
pool. Reinvestment of prepayments may occur at higher or lower
rates that the original yield on the certificates. Due to the
prepayment feature and the need to reinvest prepayments of
principal at current rates, GNMA certificates can be less
effective than typical bonds of similar maturities at "locking-in"
yields during periods of declining interest rates, although
they may have comparable risks of decline in value during periods
of rising interest rates.
FNMA and FHLMC Mortgage-Backed Obligations The Federal National
Mortgage Association ("FNMA"), a federally chartered and
privately owned corporation, issues pass-through securities
representing an interest in a pool of conventional mortgage
loans. FNMA guarantees the timely payment of principal and
interest but this guarantee is not backed by the full faith and
credit of the U.S. government. The Federal Home Loan Mortgage
Corporation ("FHLMC"), a corporate instrumentality of the United
States, issues participation certificates that represent an
interest in a pool of conventional mortgage loans. FHLMC
guarantees the timely payment of interest and the ultimate
collection of principal and maintains reserves to protect holders
against losses due to default, but the certificates are not
backed by the full faith and credit of the U.S. government. As is
the case with GNMA certificates, the actual maturity of and
realized yield on particular FNMA and FHLMC pass-through
securities will vary based on the prepayment experience of the
underlying pool of mortgages.
Mortgage-Related Securities The Fund may invest in
collateralized mortgage obligations ("CMOs") or mortgage-backed
bonds issued by financial institutions such as commercial banks,
savings and loan associations, mortgage banks and securities
broker-dealers (or affiliates of such institutions established to
issue these securities). CMOs are obligations fully
collateralized directly or indirectly by a pool of mortgages on
which payments of principal and interest are dedicated to payment
of principal and interest on the CMOs. Payments on the underlying
mortgages (both interest and principal) are passed through to the
holders, although not necessarily on a pro rata basis, on the
same schedule as they are received. Mortgage-backed bonds are
general obligations of the issuer fully collateralized directly
or indirectly by a pool of mortgages. The mortgages serve as
collateral for the issuer's payment obligations on the bonds, but
interest and principal payments on the mortgages are not passed
through either directly (as with GNMA certificates and FNMA and
FHLMC pass-through securities) or on a modified basis (as with
CMOs). Accordingly, a change in the rate of prepayments on the
pool of mortgages could change the effective maturity of a CMO
but not that of a mortgage-backed bond (although, like many
bonds, mortgage-backed bonds may be callable by the issuer prior
to maturity).
The Fund may also invest in a variety of more risky CMOs,
including interest only ("IOs"), principal only ("POs"), inverse
floaters, or a combination of these securities. Stripped
mortgage-backed securities ("SMBS") are usually structured with
several classes that receive different proportions of the
interest and principal distributions from a pool of mortgage
assets. A common type of SMBS will have one class receiving all
of the interest from the mortgage assets (an IO), while the other
class will receive all of the principal (a PO). However, in some
instances, one class will receive some of the interest and most
of the principal while the other class will receive most of the
interest and the remainder of the principal. If the underlying
mortgage assets experience greater-than-anticipated or less-than-
anticipated prepayments of principal, the Fund may fail to fully
recoup its initial investment or obtain its initially assumed
yield on some of these securities. The market value of the class
consisting entirely of principal payments generally is unusually
volatile in response to changes in interest rates. The yields on
classes of SMBS that have more uncertain timing of cash flows are
generally higher than prevailing market yields on other mortgage-
backed securities because there is a greater risk that the
initial investment will not be fully recouped or received as
planned over time.
The Fund may invest in another CMO class known as leveraged
inverse floating rate debt instruments ("inverse floaters"). The
interest rate on an inverse floater resets in the opposite
direction from the market rate of interest to which the inverse
floater is indexed. An inverse floater may be considered to be
leveraged to the extent that its interest rate varies by a
magnitude that exceeds the magnitude of the change in the index
rate of interest. The higher degree of leverage inherent in
inverse floaters is associated with greater volatility in their
market values. Accordingly, the duration of an inverse floater
may exceed its stated final maturity.
Certain CMOs may be deemed to be illiquid securities for
purposes of the Fund's 10% limitation on investments in such
securities. The investment adviser limits investments in more
risky CMOs to no more than 5% of its total assets.
<PAGE>
Certain Risk Factors Relating to High-Yield (High-Risk) Bonds
The Fund may, to a limited extent, invest in high-yield
(high-risk) bonds. That is, up to a maximum of 25% of the total value
of the Fund's portfolio of debt securities may be invested in
high-yield bonds or unrated bonds equivalent thereto. These
bonds present certain risks which are discussed below.
Sensitivity to Interest Rates and Economic Changes High-yield
bonds are very sensitive to adverse economic changes and
corporate developments. During an economic downturn or
substantial period of rising interest rates, highly leveraged
issuers may experience financial stress that would adversely
affect their ability to service their principal and interest
payment obligations, to meet projected business goals, and to
obtain additional financing. If the issuer of a bond defaulted
on its obligations to pay interest or principal or entered into
bankruptcy proceedings, the Fund may incur losses or expenses in
seeking recovery of amounts owed to it. In addition, periods of
economic uncertainty and changes can be expected to result in
increased volatility of market prices of high-yield bonds and the
Fund's net asset value.
Payment Expectations High-yield bonds may contain redemption or
call provisions. If an issuer exercised these provisions in a
declining interest rate market, the Fund might have to replace
the security with a lower yielding security, resulting in a
decreased return for investors. Conversely, a high-yield bond's
value will decrease in a rising interest rate market, as will the
value of the Fund's assets. If the Fund experiences unexpected
net redemptions, this may force it to sell high-yield bonds
without regard to their investment merits, thereby decreasing the
asset base upon which expenses can be spread and possibly
reducing the Fund's rate of return.
Liquidity and Valuation There may be little trading in the
secondary market for particular bonds, which may affect adversely
the Fund's ability to value accurately or dispose of such bonds.
Adverse publicity and investor perceptions, whether or not based
on fundamental analysis, may decrease the values and liquidity of
high-yield bonds, especially in a thin market.
INVESTMENT RESTRICTIONS
The Trust has adopted the following fundamental restrictions
relating to the investment of assets of the Fund and other
investment activities. These are fundamental policies and may
not be changed without the approval of holders of the majority of
the outstanding voting shares of the Fund. The Trust's
fundamental investment restrictions provide that the Fund is not
allowed to:
(1) Issue senior securities [except that the Fund may borrow
money as described in restriction (9) below].
(2) With respect to 75% of the value of its total assets,
invest more than 5% of its total assets in securities (other than
securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities) of any one issuer.
(3) Purchase more than either: (i) 10% in principal amount
of the outstanding debt securities of an issuer, or (ii) 10% of
the outstanding voting securities of an issuer.
<PAGE>
(4) Invest more than 25% of its total assets in the
securities of issuers primarily engaged in the same industry.
For purposes of this restriction, gas, gas transmission,
electric, water, and telephone utilities each will be considered
separate industries. This restriction does not apply to
obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.
(5) Purchase or sell commodities, commodity contracts or
real estate, except that the Fund may purchase securities of
issuers which invest or deal in any of the above, and except that
the Fund may invest in securities that are secured by real
estate. This restriction does not apply to obligations issued or
guaranteed by the U.S. Government, its agencies or
instrumentalities nor to futures contracts.
(6) Purchase any securities on margin (except that the Trust
may obtain such short-term credit as may be necessary for the
clearance of purchases and sales of portfolio securities) or make
short sales of securities or maintain a short position.
(7) Make loans, except through the purchase of obligations
in private placements or by entering into repurchase agreements
(the purchase of publicly traded obligations not being considered
the making of a loan).
(8) Lend its securities.
(9) Borrow amounts in excess of 10% of its total assets,
taken at market value at the time of the borrowing, and then only
from banks as a temporary measure for extraordinary or emergency
purposes, or to meet redemption requests that might otherwise
require the untimely disposition of securities, and not for
investment or leveraging. Securities will not be purchased while
borrowings are outstanding.
(10) Mortgage, pledge, hypothecate or in any manner
transfer, as security for indebtedness, any securities owned or
held by the Fund. This restriction shall not apply to borrowings
permitted by restriction number (9) above.
(11) Underwrite securities of other issuers except insofar
as the Trust may be deemed an underwriter under the Securities
Act of l933 in the sale of restricted securities.
(12) Invest in companies for the purpose of exercising
control.
(13) The Fund is limited to investing no more than 10% of
its assets in illiquid securities (including restricted
securities and repurchase agreements maturing in more than seven
days) or in the securities of issuers which together with any
predecessors have a record of less than three years continuous
operation.
The Trust, in regard to the Fund, has also adopted the
following additional investment restrictions that are not
fundamental and may be changed by the Board of Trustees without
shareholder approval. Under these restrictions, the Fund may
not:
(1) Invest in securities of foreign issuers (other than
Canadian) except American Depository Receipts and securities
listed for trading on the New York or American Stock Exchange.
(2) Participate on a joint (or a joint and several) basis in
any trading account in securities (but this does not prohibit the
"bunching" of orders for the sale or purchase of securities of
the Fund with other accounts advised or sponsored by the adviser
or any of its affiliates to reduce brokerage commissions or
otherwise to achieve best overall execution).
(3) Purchase or retain the securities of any issuer, if, to
the knowledge of the Trust, officers and Trustees of the Trust,
the adviser or any affiliate thereof each owning beneficially
more than .5% of one of the securities of such issuer, own in the
aggregate more than 5% of the securities of such issuer.
(4) Purchase or sell interests in oil, gas, or other mineral
exploration or development programs, or real estate mortgage
loans, except that the Fund may purchase securities of issuers
which invest or deal in any of the above, and except that the
Fund may invest in securities that are secured by real estate
mortgages. This restriction does not apply to obligations or
other securities issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.
(5) Purchase securities of other investment companies with
an aggregate value in excess of 5% of the Fund's total assets,
except in connection with a merger, consolidation, acquisition or
reorganization, or by purchase in the open market of securities
of closed-end investment companies where no underwriter or
dealer's commission or profit, other than customary broker's
commission, is involved, and only if immediately thereafter not
more than 10% of the Fund's total assets, taken at market value,
would be invested in such securities.
If a percentage restriction (for either fundamental or
nonfundamental policies) is adhered to at the time of investment,
a later increase or decrease in percentage beyond the specified
limit resulting from a change in values of portfolio securities
or amount of net assets shall not be considered a violation.
PORTFOLIO TURNOVER
Portfolio turnover is calculated by dividing the lesser of
purchases or sales of portfolio securities during the fiscal year
by the monthly average of the value of the Fund's securities
(excluding from the computation all securities, including
options, with maturities at the time of acquisition of one year
or less). A high rate of portfolio turnover generally involves
correspondingly greater brokerage commission expenses that must
be borne directly by the Fund. Turnover rates may vary greatly
from year to year as well as within a particular year and may
also be affected by cash requirements for redemptions of Fund
shares and by requirements that enable the Fund to receive
certain favorable tax treatments. Portfolio turnover rates, of
course, depend in large part on the level of purchases and
redemptions of shares of the Fund. However, because rate of
portfolio turnover is not a limiting factor, particular holdings
may be sold at any time, if investment judgment or the Fund
operations make a sale advisable. It is estimated that the
annual portfolio turnover rate for the Fund will be 75%. For the
years ended October 31, 1995, October 31, 1994 and October 31,
1993, the actual portfolio turnover rates were 42%, 53%, and 43%,
respectively.
MANAGEMENT OF THE TRUST
Trustees and Officers
The Trustees and executive officers of the Trust and their
principal occupations for the last five years are set forth
below. Unless otherwise noted, the address of each executive
officer and Trustee is 1876 Waycross Road, Cincinnati, Ohio
45240.
<TABLE>
<CAPTION>
Principal
Occupation(s)
Name, Address Position(s) with During Past
and Age the Trust Five Years
- - ------------- ---------------- --------------
<S> <C> <C>
George M. Callard, M.D.* Trustee Cardiovascular Surgeon
3021 Erie Avenue and Professor of
Cincinnati, Ohio 45208 of Clinical Surgery,
(Age 62) University of
Cincinnati
George L. Clucas** Trustee, Senior Vice President,
(52) President and UC; Director,
Chief Executive President and Chief
Officer Executive Officer,
Carillon Advisers, Inc.
("Adviser"); Director,
Carillon Investments,
Inc. ("CII")
Theodore H. Emmerich* Trustee Consultant; former Partner,
1201 Edgecliff Pl. Ernst & Whinney, Accountants
Cincinnati, Ohio 45206
(69)
James M. Ewell* Trustee Retired Senior Vice President
9000 Indian Ridge Road and Director, The Procter
Cincinnati, Ohio 45243 and Gamble Company
(80)
Richard H. Finan* Trustee Attorney at Law; President
11137 Main Street Pro Tempore of the
Cincinnati, Ohio 45241 Ohio State Senate
(61)
Jean Patrice Harrington, Trustee Former Executive Director,
S.C.* Cincinnati Youth
3217 Whitfield Ave. Collaborative; President
Cincinnati, Ohio 45220 Emeritus (formerly, President),
(70) College of Mount St. Joseph
John H. Jacobs** Trustee Senior Vice President, UC;
(49) prior to December, 1992,
Officer and employee, UC
Charles W. McMahon* Trustee Retired Senior Vice
2031 W. Galbraith Rd., #E President and Director, UC
Cincinnati, Ohio 45239
(76)
Harry Rossi** Trustee Director Emeritus, UC; Director,
8548 Wyoming Club Drive Adviser; former Chairman,
Cincinnati, Ohio 45215 President and Chief Executive
(76) Officer, UC
Stephen R. Hatcher Senior Vice Senior Vice President and Chief
(53) President Financial Officer, UC
John F. Labmeier Vice President Second Vice President,
(47) and Secretary Associate General Counsel and
Assistant Secretary, UC; Vice
President and Secretary, CII;
Secretary, Adviser
Thomas G. Knipper Controller Assistant Controller, UC; prior
(38) to July, 1995, Treasurer of
The Gateway Trust and Vice
President and Controller of
Gateweay Advisers, Inc.; prior
to April, 1992, Senior Manager
of Deloitte & Touche.
Joseph A. Tucker Treasurer Assistant to the Treasurer, UC;
(61) prior to October, 1992, Officer
and employee, UC
John M. Lucas Assistant Assistant to the Secretary, UC;
(45) Secretary prior to October, 1992, Officer
and employee, UC
</TABLE>
- - -----------------
*Trustees identified with an asterisk are members of the Audit
Committee.
**Messrs. Clucas, Jacobs and Rossi are considered to be
"interested persons" of the Fund as defined in the Investment
Company Act of 1940 because of their affiliation with the
Adviser.
As of the date of this Statement of Additional information,
Officers and Trustees collectively owned less than 1% of the
outstanding shares of the Fund. Trustees who are not officers or
employees of the Adviser or any of its affiliates are paid a fee
of $250 plus actual out-of-pocket expense by the Trust for each
meeting of the Board of Trustees attended and $500 per calendar
quarter ($2,000 annually). Trustees who are members of the Audit
Committee are compensated at the rate of $150 per Audit Committee
meeting. The total of such fees incurred by the Trust for the
year ended October 31, 1995 was $21,573.
<PAGE>
<PAGE>
Compensation Table
<TABLE>
<CAPTION>
(1) (2) (3) (4) (5)
Total
Pension or Estimated Compensation
Retirement Annual From
Benefits Estimated Registrant
Aggregate Accrued Annual and Fund
Compensation As Part of Benefits Complex*
Name of Person, From Fund Upon Paid to
Position Registrant Expenses Retirement Directors
- - --------------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C>
George M. Callard, 3,300 -- -- 10,600
M.D.
Trustee
George L. Clucas N/A N/A N/A N/A
Trustee
Theodore H. Emmerich 3,300 -- -- 10,800
Trustee
James M. Ewell 3,300 -- -- 10,600
Trustee
Richard H. Finan 3,300 -- -- 10,600
Trustee
Jean Patrice 3,300 -- -- 10,600
Harrington, S.C.
Trustee
John H. Jacobs N/A N/A N/A N/A
Trustee
Charles W. McMahon 3,300 -- -- 10,600
Trustee
Harry Rossi N/A N/A N/A N/A
Trustee
</TABLE>
*Each of the Trustees also serves as a director of Carillon Fund,
Inc.
INVESTMENT ADVISER
Approval of the Agreement
The Trust has entered into an Investment Advisory
Agreement ("Agreement") on behalf of the Fund with Carillon
Advisers, Inc. ("Adviser"), whose principal business address is
l876 Waycross Road, Cincinnati, Ohio 45240 (P.O. Box 40407,
Cincinnati, Ohio 45240). The Adviser was incorporated under the
laws of Ohio on August 18, l986, and is a wholly-owned subsidiary
of UC, a mutual insurance company organized in 1867 under the
laws of Ohio. Executive officers and directors of the Adviser
who are affiliated with the Trust are George L. Clucas, President
and Chief Executive Officer; Thomas G. Knipper, Treasurer; and
John F. Labmeier, Secretary.
The Agreement was approved by shareholders on February
22, l989 and approved for continuance each year thereafter by the
Board of Trustees. The Agreement was last continued by the Board
of Trustees on December 13, 1995. The Agreement will continue in
effect from year to year if approved annually by the Trustees or
by a majority of the outstanding shares of the Fund. In either
case, continuance of the Agreement must be approved by a majority
of the Trustees who are not parties to the Agreement or
interested persons (as defined by the l940 Act) of any such
party. The Agreement is not assignable and may be terminated
without penalty by the Trust or the Adviser on 60 days' notice to
the other party.
If the question of continuance of the Agreement (or adoption
of any new agreement) is presented to shareholders, continuance
(or adoption) shall be effective only if approved by a majority
vote of the outstanding voting securities.
Responsibilities of the Adviser
Pursuant to the Agreement, the Trust has retained the
Adviser to manage the investment of the Fund's assets, including
the placing of orders for the purchase and sale of the portfolio
securities of the Fund. The Adviser is at all times subject to
the direction and supervision of the Trustees of the Trust.
The Adviser continuously furnishes an investment program for
the Fund, is responsible for the actual management of the Fund
and has responsibility for making decisions to buy, sell or hold
any particular security. The Adviser obtains and evaluates such
information and advice relating to the economy, securities
markets and specific securities as it considers necessary or
useful to continuously manage the assets of the Fund in a manner
consistent with its investment objectives, policies and
restrictions. The Adviser considers analyses from various
sources, makes necessary investment decisions and effects
transactions accordingly.
The Agreement provides that the Adviser shall not be liable
to the Trust or to any shareholder for any error of judgment or
mistake of law or for any loss suffered by the Trust or by any
shareholder in connection with matters to which the Agreement
relates, except a loss resulting from willful misfeasance, bad
faith, gross negligence, or reckless disregard on the part of the
Adviser in the performance of its duties thereunder.
Trust Expenses
Under the advisory Agreement, Adviser is required to furnish
at its own expense or to pay the expenses of the Trust for the
following: office space and all necessary office facilities and
equipment; necessary executive and other personnel for managing
the affairs of the Trust, including personnel for the performance
of clerical, accounting and other office functions (exclusive of
those relating to and to be performed under contracts for
custodial, bookkeeping, transfer and dividend-disbursing agency
services by a bank or other service supplier selected to perform
such services); all information and services, other than services
of counsel, required in connection with the preparation of
registration statements and prospectuses, including amendments
and revisions thereto; and all annual, semiannual and periodic
reports, notices and proxy solicitation material furnished to
shareholders of the Trust or regulatory authorities (excluding
any costs of printing or mailing such items).
The Fund pays all other expenses incurred in its operation
and for the general administration of the Fund. Expenses other
than the Adviser's fee that are borne directly include, but are
not limited to, brokerage commissions, dealer markups, expenses
incurred in the acquisition of Fund securities, transfer taxes,
transaction expenses of the custodian, pricing services used by
the Fund, custodian, dividend disbursing agent, transfer agent,
bookkeeping services, pricing, shareholders' and Trustees'
meetings, Trustees' fees, registration fees and costs, fees and
expenses of legal counsel not including employees of the Adviser,
or any affiliate of the Adviser, independent accountants,
membership dues of industry associations, postage, insurance
premiums including fidelity bond, and all other costs properly
payable by the Fund.
The Agreement also provides that the expense limitations
required by State Blue Sky Laws shall be observed where
applicable. The Adviser is required to reimburse certain
additional expenses that exceed any State expense limitation.
Presently, the expense limitation requirement is 2.5% of the
first $30 million of average net assets, 2.0% of the next $70
million average net assets and 1.5% of the remaining average net
assets.
Advisory Fee
As full compensation for the services and facilities
furnished to the Fund and expenses of the Trust assumed by the
Adviser, the Fund pays the Adviser a monthly fee based on the
average net assets of the Fund. This fee is computed at the
annual rate of .75% of the first $50,000,000, .65% of the next
$100,000,000, and .50% of all amounts over $150,000,000.
There is no assurance the Fund will reach a net asset
level high enough to realize a reduction in the rate of the
advisory fee. The advisory fees the Fund paid to Adviser for the
years ended October 31, 1995, October 31, 1994 and October 31,
1993 amounted to $327,862, $281,657 and $238,690,
respectively.
Administration
The Adviser is responsible for providing certain
administrative functions to the Trust and has entered into an
Administration Agreement with Carillon Investments, Inc. ("CII")
under which CII furnishes substantially all of such services for
an annual fee of .20% of the Trust's average net assets. The fee
is borne by the Adviser, not the Trust. Under the Administration
Agreement, CII is obligated to provide persons for clerical,
accounting, bookkeeping, administrative and other similar
services, to supply office space, stationery and office supplies,
and to prepare tax returns, reports to stockholders, and filings
with the Securities and Exchange Commission and state securities
authorities.
Brokerage Allocation
The Adviser is primarily responsible for the investment
decisions of the Fund, including decisions to buy and sell
securities, the selection of brokers and dealers to effect the
transactions, the placing of investment transactions, and the
negotiation of brokerage commissions. The Fund has no obligation
to deal with any dealer or group of dealers in the execution of
transactions in portfolio securities. In placing orders, it is
the policy of the Trust to obtain the most favorable net results,
taking into account various factors, including price, dealer
spread or commission, if any, size of the transaction, and
difficulty of execution. While the Adviser generally seeks
reasonably competitive spreads or commissions, the Fund will not
necessarily be paying the lowest spread or commission available.
If the securities in which the Fund invests are traded
primarily in the over-the-counter market, where possible, the
Adviser will deal directly with the dealers who make a market in
the securities involved, unless better prices and execution are
available elsewhere. Such dealers usually act as principals for
their own account. On occasion, securities may be purchased
directly from the issuer. Bonds and money market instruments are
generally traded on a net basis and do not normally involve
either brokerage commissions or transfer taxes. The cost of the
securities transactions consists primarily of brokerage
commissions or dealer or underwriter spreads.
While the Adviser seeks to obtain the most favorable net
results in effecting transactions in the Fund securities, dealers
who provide supplemental investment research to the Adviser may
receive orders for transactions by the Trust. Such supplemental
research service ordinarily consists of assessments and analyses
of the business or prospects of a company, industry, or economic
sector. If, in the judgment of the Adviser, the Trust will
benefit by such supplemental research services, the Adviser is
authorized to pay commissions to brokers or dealers furnishing
such services that might be in excess of commissions that another
broker or dealer may charge for the same transaction.
Information so received will be in addition to and not in lieu of
the services required to be performed by the Adviser under the
Agreement. The expenses of the Adviser will not necessarily be
reduced as a result of the receipt of such supplemental
information. In some cases, the Adviser may use such
supplemental research in providing investment advice to its other
advisory accounts.
During the years ended October 31, 1995, October 31, 1994
and October 31, 1993, the Fund paid $27,280, 26,640 and $32,593,
respectively, in brokerage commissions. Of the brokerage
commissions paid during the year ended October 31, 1995, 45% was
paid to brokers furnishing statistical data or research
information. These commissions were for transactions aggregating
100% of the Fund's total transactions during the same time
period. No commissions were paid to affiliates of the Trust.
Other Clients of the Adviser
The Agreement in no way restricts the Adviser from acting as
investment manager or adviser to others. Securities recommended
for purchase for the Trust may also be recommended to other
clients, including registered investment companies, for which the
Adviser acts as an adviser. Because of different investment
objectives or other factors, a particular security may be bought
by one or more of the Adviser's clients, when one or more other
clients are selling the same security. If purchases or sales of
securities for the Fund or other clients of the Adviser arise for
consideration at or about the same time, transactions in such
securities will be made for the Fund and other clients in a
manner deemed equitable to all. To the extent that transactions
on behalf of more than one client of the Adviser during the same
period may increase the demand for securities being purchased or
the supply of securities being sold, there may be an adverse
effect on price.
On occasion when the Adviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as other
clients, it may, to the extent permitted by applicable laws and
regulations, but will not be obligated to, aggregate the
securities to be sold or purchased for the Fund with those to be
sold or purchased for other accounts in order to obtain more
favorable execution and lower brokerage commissions. In that
event, allocation of the securities purchased or sold, as well as
the expenses incurred in the transaction, will be made by the
Adviser in the manner it considers to be equitable and consistent
with its fiduciary obligations to the Trust and to such other
entities. In some cases this procedure may adversely affect the
size of the position obtainable for the Fund.
DETERMINATION OF NET ASSET VALUE
As described in the Prospectus for the Fund, the net asset
value of its shares is determined once daily, Monday through
Friday, at the close of business of the New York Stock Exchange
(presently 4:00 PM Eastern Time) when there are purchases or
redemptions of its shares, except: (i) when the New York Stock
Exchange is closed (currently New Year's Day, President's Day,
Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day, and Christmas Day); (ii) the day following
Thanksgiving Day; (iii) December 24, 1996; and (iv) any day on
which changes in the value of the Fund securities will not
materially affect the current net asset value of its shares. Net
asset value is determined by dividing the Fund's total net assets
by the number of shares outstanding at the time of calculation.
Total net assets are determined by adding the total current value
of portfolio securities, cash, receivables and other assets and
subtracting liabilities.
Securities held by the Fund, except for money market
instruments maturing in 60 days or less, will be valued as
follows: (a) securities traded on stock exchanges (including
securities traded in both the over-the-counter market and on an
exchange) or listed on the NASDAQ National Market System are
valued at the last sales price as of the close of the New York
Stock Exchange on the day the securities are being valued, or,
lacking any sales, at the last bid prices; (b) securities traded
only in the over-the-counter market that are not part of the
NASDAQ National Market System are valued at the last bid prices
quoted by brokers that make markets in the securities at the
close of trading on the New York Stock Exchange; and (c)
securities and assets for which market quotations are not readily
available are valued at fair value as determined in good faith
by, or under procedures adopted by, the Board of Trustees.
Money market instruments with a remaining maturity of 60
days or less held by the Fund are valued on an amortized cost
basis. Under this method of valuation, the instrument is
initially valued at cost (or in the case of instruments initially
valued at market value, at the market value on the day before its
remaining maturity is such that it qualified for amortized cost
valuation); thereafter, the Fund assumes a constant proportionate
amortization in value until maturity of any discount or premium,
regardless of the impact of fluctuating interest rates on the
market value of the instrument. While this method provides
certainty in valuation, it may result in periods during which
value, as determined by amortized cost, is higher or lower than
the price that would be received upon sale of the instrument.
<PAGE>
PERFORMANCE
From time to time the Fund may advertise its "average total
return." These figures will be based on historical earnings and
are not intended to indicate future performance.
TOTAL RETURN - The total return quotation is based upon a
hypothetical $1,000 invested at the public offering price
made at the beginning of 1, 5 or 10 year periods (or
fractional portion thereof). In general, the total return
is computed by finding the average annual compounded rates
of return over the 1-, 5-, and 10-year periods or from the
effective date if the Fund has been in effect less than the
stated periods, that would equate the initial amount invested
to the ending redeemable value. The formula for determining
the total return is P(1+T)(to the nth power)=ERV.
Recurring charges, if any, are prorated among investors. The
flat fee is divided by the average account value per $1,000
per investor in order to equate the flat fee to a $1,000
account size basis.
Performance information for the Fund may be compared, in reports
and promotional literature, to: (i) the Standard & Poor's 500
Stock Index ("S&P 500"), or other indices measuring performance
of a pertinent group of securities so that investors may compare
the Fund's results with those of a group of securities widely
regarded by investors as representative of the securities markets
in general; (ii) other investment products tracked by Lipper
Analytical Services, a widely used independent research firm
which ranks mutual funds and other investment companies by
overall performance, investment objectives, and assets, or
tracked by other ratings services, companies, publications, or
persons such as Morningstar who rank investment products on
overall performance or other criteria; (iii) Lehman Brothers U.S.
Treasury Composite; and (iv) the Consumer Price Index (measure
for inflation) to assess the real rate of return from an
investment in the Fund. Unmanaged indices may assume the
reinvestment of dividends but generally do not reflect deductions
for administrative and management costs and expenses.
Performance Through October 31, 1995
The average total return for the Fund from inception to date
periods ended October 31, 1995 are as follows.
<TABLE>
<CAPTION>
Average Annual Total Return*
Period Ended October 31, 1995
Since
Inception Date 1 Year 5 Years Inception
- - --------------------------------------------------------------------
<S> <C> <C> <C> <C>
Carillon Capital Fund 2/28/88 5.34% 12.68% 10.19%
- - --------------------------------------------------------------------
</TABLE>
*Based upon the maximum sales charge of 5%
<PAGE>
DISTRIBUTION OF SHARES
Distributor
Carillon Investments, Inc. ("CII"), located at l876 Waycross
Road, Cincinnati, Ohio 45240 (P.O. Box 40409, Cincinnati, Ohio
45240), serves as the principal underwriter of Fund shares.
Pursuant to a Distribution Agreement with the Trust, CII agrees
to use its best efforts to promote, offer for sale and sell the
shares of the Fund to the public on a continuous basis whenever
and wherever it is legally authorized to do so. In so doing, CII
conducts its affairs in accordance with the Rules of Fair
Practice of the National Association of Securities Dealers, Inc.
("NASD").
CII sells Fund shares primarily through its own registered
representatives. CII may, however, authorize the sale of shares
by firms that are registered broker-dealers and are members of
the NASD.
CII receives no compensation on redemption or repurchase
of Fund shares and receives no brokerage commissions or
compensation other than the sales load and administration fee
from the Adviser. CII received $1,576, $174 and $1,271,
respectively, in aggregate commissions from the sale of Trust
shares for the years ended October 31, 1995, October 31, 1994 and
October 31, 1993. Of these amounts, CII retained $315, $35 and
$254 for the respective periods.
PURCHASE AND REDEMPTION OF SHARES
Sales Charge
Application forms for the purchase of Fund shares can be
obtained from CII or from a broker-dealer that has entered into a
dealer agreement with CII. Shares are sold at the next computed
net asset value with the imposition of a sales load ranging from
5% on investments of less than $50,000 to .5% for investments
over $2,500,000.
Qualifying for a Reduced Sales Charge
As the chart shown in the Prospectus for the Fund indicates,
the percentage sales charge decreases at various break points as
the amount of an investment is increased. Even though an
investment, considered alone, does not qualify for a reduced
sales charge, it may qualify for a reduced charge when made as
part of one or both of the following investment programs:
(a) LETTER OF INTENT: An investor may qualify for a
reduced sales charge by executing a Letter of Intent indicating
the total amount to be invested in Fund shares within the 13-month
period following the date of the Letter. The sales charge
made in connection with each investment during the 13-month
period will be at the rate applicable to the total amount that
has been indicated will be invested during the period. However,
a number of shares sufficient to pay the larger sales charge will
be escrowed until the Letter of Intent is completed.
An existing shareholder should sign a Letter of Intent only
if the amount intended to be invested qualifies for a reduced
sales charge.
Although an investor is not under any legal obligation to
make the investments specified in a Letter of Intent, there is a
provision for a price adjustment in the event that the amount
invested differs from that specified in the Letter. Sufficient
shares would be held in escrow during the period covered by the
Letter to make up any difference in sales price based upon the
amount actually invested. But even if the Letter is not
completed, the sales charge applicable to the investments made
while the Letter is in effect will not be higher than that which
would apply if the Letter had been for the amount actually
invested. The Letter of Intent form is part of the Investment
Application.
(b) RIGHT OF ACCUMULATION AND COMBINED ACCOUNTS: To
determine whether or not a reduced sales charge applies to an
investment, the Fund, when notified to do so by the investor at
the time a purchase is made, takes into account not only the
money then being invested in Fund shares, but also the current
net asset value of all shares already owned by the investor, his
or her spouse and any minor children for whom the investor or
spouse is the custodian.
As an example, assume that an investor already owns Fund
shares with a total net asset value of $40,000 and now wishes to
invest $10,000 more. The reduced sales charge of 4% will apply
to the $10,000 investment.
The aggregate amount invested at one time by the investor,
his or her spouse, and for the accounts of any minor children for
which the investor or spouse is the custodian may be considered a
single purchase for the purpose of computing the sales charge. A
trustee or other fiduciary may likewise aggregate the amounts
invested on behalf of the beneficiaries under a single trust
estate or a single fiduciary account. Such persons are required
to notify the Trust of the shareholder accounts being combined at
the time of investment in order to take advantage of this reduced
sales charge privilege.
Redemptions
The Trust is required to redeem all full and fractional
shares of the Fund at the net asset value per share. Payment for
shares redeemed will generally be made within seven days after
receipt of a proper notice of redemption. The right to redeem
shares or to receive payment with respect to any redemption may
only be suspended for any period during which: (a) trading on
the New York Stock Exchange is restricted as determined by the
Securities and Exchange Commission or such exchange is closed for
other than weekends and holidays; (b) an emergency exists, as
determined by the Securities and Exchange Commission, as a result
of which disposal of portfolio securities or determination of the
net asset value is not reasonably practicable; or (c) the
Securities and Exchange Commission by order permits postponement
for the protection of shareholders.
<PAGE>
TAXES
Under the Internal Revenue Code ("Code"), the Fund is a
separate entity for purposes of the "regulated investment
company" provisions of Subchapter M of the Code. The Fund has
elected to be treated as a regulated investment company and, as
such, it will be relieved of federal income tax liability on the
amounts it distributes. In order to qualify as a regulated
investment company, the Fund must: (a) derive at least 90 percent
of its annual gross income from dividends, interest, gains from
the sale of securities or other income derived with respect to
investing in securities; (b) derive less than 30 percent of its
gross income from gains realized on the sale or other disposition
of securities held for less than three months; and (c) diversify
its holdings so that, at the end of each fiscal quarter: (i) at
least 50% of the market value of its assets is represented by
cash, government securities and other securities limited in
respect of any one issuer to 5% of assets and to not more than
10% of the voting securities of such issuer; and (ii) not more
than 25% of the value of its assets is invested in the securities
of any one issuer (other than U.S. Government securities).
It is expected, although it is not wholly clear, that any
net gain realized from closing out options on U.S. Treasury
securities or options on futures contracts for such securities
will be considered gain from the sale of securities and,
therefore, will be qualifying income for purposes of the 90
percent requirement. In order to meet this qualification
requirement, the Fund may be required to defer disposing of
certain options, futures contracts and underlying securities
beyond the time when it might otherwise be advantageous to do so.
These requirements may also limit the Fund's ability to: (a)
sell investments held for less than three months; (b) effect
closing transactions on options written less than three months
previously; (c) write options for a period of less than three
months; (d) write options on securities held for less than six
months; and (e) write options on futures contracts to the extent
they are considered commodities and not securities.
The Code imposes a 4% nondeductible excise tax on a
regulated investment company to the extent such company does not
distribute at least 98% of its ordinary income and 98% of its
capital gains (both long-term and short-term) each year by the
end of such year. Dividends and distributions will be treated as
paid when actually distributed, except that dividends declared in
December payable to shareholders of record on a specified date in
December, and paid before February 1 of the following year, will
be treated as having been (i) paid by the Fund on the record date
and (ii) received by each shareholder on that date.
The above discussion is informational only and is not to be
considered tax advice. Participants are urged to consult a
competent tax adviser before taking any action which could have
tax consequences.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT
Firstar Trust Company, Mutual Fund Services, P.O. Box 701,
Milwaukee, WI 53201-0701, is the custodian and transfer and
dividend disbursing agent for the Trust. Pursuant to its
agreement with the Fund, Firstar Trust Company determines the net
asset value of the Trust's shares on a daily basis and performs
certain other duties.
<PAGE>
ADDITIONAL INFORMATION
This Statement of Additional Information and the Prospectus
for the Fund do not contain all the information set forth in the
registration statement and exhibits relating thereto, that the
Trust has filed with the Securities and Exchange Commission,
Washington, D.C., under the Securities Act of l933 and the l940
Act, to which reference is hereby made.
INDEPENDENT AUDITORS
The financial statements of the Fund have been audited by
Deloitte & Touche LLP, 1700 Courthouse Plaza NE, Dayton, Ohio
45402, independent auditors, whose report follows. The financial
statements are included in this Statement of Additional
Information in reliance upon the report of Deloitte & Touche LLP,
given upon their authority as experts in auditing and accounting.
<PAGE>
CARILLON CAPITAL FUND
OF
CARILLON INVESTMENT TRUST
ANNUAL REPORT
October 31, 1995
(<PAGE>
Report of Independent Accountants
============================================================
To the Board of Trustees and Shareholders of
Carillon Capital Fund of Carillon Investment Trust
We have audited the accompanying statement of assets and
liabilities of Carillon Capital Fund, including the schedule of
investments, as of October 31, 1995, and the financial
highlights, the related statement of operations, and the
statement of changes in net assets for the year then ended.
These financial statements and financial highlights ("financial
statements") are the responsibility of the Fund's management.
Our responsibility is to express an opinion on these financial
statements based on our audits. The financial highlights for the
other years presented and the statement of changes in net assets
for the year ended October 31, 1994 were audited by other
auditors whose report, dated December 2, 1994, expressed an
unqualified opinion on those statements.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosure in the financial statements. Our
procedures included confirmation of securities owned as of
October 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 audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements as of October 31, 1995,
present fairly, in all material respects, the financial position
of Carillon Capital Fund as of October 31, 1995, and the results
of its operations, the changes in its net assets, and the
financial highlights for the year then ended, in conformity with
generally accepted accounting principles.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Dayton, Ohio
November 28, 1995
<PAGE>
CARILLON CAPITAL FUND
SCHEDULE OF INVESTMENTS
- - --------------------------------------------------
OCTOBER 31, 1995
- - --------------------------------------------------
COMMON STOCKS - 36.73%
- - --------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
<S> <C> <C>
AUTO PARTS - 0.88%
Breed Technologies, Incorporated 9,500 $ 176,938
Strattec Security Corporation* 14,000 234,500
-----------
411,438
-----------
BANK & BANK HOLDING COMPANIES - 2.90%
ABN AMRO Holdings NV Sponsored ADR 8,228 345,233
Banco Latinoamericano de Exportaciones ADR* 15,000 626,250
Deutsche Bank AG Sponsored ADR 8,370 378,422
-----------
1,349,905
-----------
BUILDING & HOUSING - 0.90%
ABT Building Products Company* 11,000 141,625
Falcon Products, Incorporated 20,000 280,000
-----------
421,625
-----------
BUSINESS - MECHANICS & SOFTWARE - 1.28%
DH Technology, Incorporated 30,240 597,240
-----------
CHEMICAL - 2.82%
Bayer AG Sponsored ADR 25,000 664,647
Ciba-Geigy Sponsored ADR 15,000 648,696
-----------
1,313,343
-----------
CONGLOMERATE - 0.71%
Mannesman AG ADR 1,000 328,987
-----------
CONTAINER - 1.42%
AEP Industries, Incorporated 29,169 656,303
-----------
ENGINEERING & CONSTRUCTION - 0.25%
Mestek, Incorporated* 10,000 115,000
-----------
GOLD & PRECIOUS METALS - 1.72%
Free State Consolidated Gold Mines Limited ADR 7,000 66,063
Minorco Sponsored ADR 21,000 572,250
Royal Oak Mines, Incorporated* 45,000 165,938
-----------
804,251
-----------
HEALTH CARE - 1.92%
Lunar Corporation* 15,000 558,750
Orthofix International NV* 12,000 117,000
Sofamor / Danek Group* 9,000 220,500
-----------
896,250
-----------
HEALTH CARE SERVICES - 0.94%
Rightchoice Managed Care Incorporated
- Class A* 15,000 191,250
United Wisconsin Services, Incorporated 10,000 248,750
-----------
440,000
-----------
HOSPITAL SUPPLY & SERVICES - 0.81%
Allied Healthcare Products Incorporated 20,000 380,000
-----------
HOUSEHOLD PRODUCTS - 1.49%
Chromecraft Revington Incorporated* 7,000 168,000
Helen of Troy Limited, Bermuda* 13,000 240,500
Lifetime-Hoan Corporation 29,947 284,497
-----------
692,997
-----------
INSURANCE - 2.30%
Capital American Financial Corporation 10,000 $ 196,250
Gainsco Incorporated 21,000 181,125
RLI Corporation 14,520 339,405
Torchmark Corporation 5,000 207,500
United Insurance Companies, Incorporated 8,800 149,600
-----------
1,073,880
-----------
INTERNATIONAL BOND - 0.38%
Templeton Global Income Fund 25,000 175,000
-----------
INVESTMENT COMPANIES - 1.02%
BlackRock Strategic Term Trust 25,000 187,500
France Growth Fund, Incorporated 4,333 41,705
New Germany Fund 20,000 245,000
-----------
474,205
MACHINERY - AGRICULTURE & CONSTRUCTION - 1.01%
Lindsay Manufacturing Company* 13,359 470,905
-----------
MISCELLANEOUS - ENERGY - 1.19%
Holly Corporation 12,000 261,000
Repsol S.A. Sponsored ADR 10,000 296,250
-----------
557,250
-----------
MISCELLANEOUS - MANUFACTURING - 0.60%
ILC Technology, Incorporated* 10,000 93,750
Versa Technologies, Incorporated 12,000 186,000
-----------
279,750
-----------
MISCELLANEOUS - SERVICE - 0.22%
PCA International Incorporated 10,000 103,750
-----------
OIL & GAS - DOMESTIC - 0.73%
Horsham Corporation 15,000 202,500
Plains Resources, Incorporated* 20,000 136,250
-----------
338,750
-----------
OIL & GAS - INTERNATIONAL - 0.29%
YPF S. A. Sponsored ADR 8,000 137,000
-----------
OIL & GAS - SERVICES - 1.37%
Global Industries Incorporated* 15,000 393,750
Offshore Logistics, Incorporated* 20,000 247,500
-----------
641,250
-----------
REAL ESTATE - 8.22%
Associated Estates Realty Corporation 20,000 410,000
Bradley Real Estate Incorporated 13,000 186,875
CBL & Associates Properties Incorporated 16,000 340,000
Duke Realty Investments Incorporated 12,000 367,500
Felcor Suite Hotels Incorporated 10,000 288,750
Glimcher Realty Trust 15,000 270,000
Health Care Property Investors, Incorporated 6,704 227,098
IRT Properties Company 25,000 237,500
LTC Properties Incorporated 14,000 203,000
Merry Land & Investment Company 18,000 378,000
Mid-America Apartment Communities 18,000 414,000
NAB Asset Corporation 15,000 69,375
Shurgard Storage Centers Incorporated 17,400 443,700
-----------
3,835,798
-----------
RETAIL - GENERAL - 0.21%
Claire's Stores, Incorporated 500 9,812
Value City Department Stores* 15,000 90,000
-----------
99,812
-----------
SAVINGS & LOAN - 0.76%
Standard Federal Bancorp 10,000 355,000
-----------
UTILITIES - 0.39%
Texas Utilities Company 5,000 183,750
Total Common Stocks (cost $13,680,192) 17,133,439
-----------
<CAPTION>
- - -----------------------------------
PREFERRED STOCK - 0.72%
- - -----------------------------------
SHARES VALUE
------ -----
<S> <C> <C>
METAL & MINERAL - 0.72%
Freeport McMoRan Copper & Gold 10,000 $ 335,000
-----------
Total Preferred Stocks (cost $347,888) 335,000
-----------
<CAPTION>
- - --------------------------------------------------
U.S. TREASURY OBLIGATIONS - 12.73%
- - --------------------------------------------------
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
U.S. TREASURY NOTES - 12.73%
7.500% due 02/29/96 $ 250,000 $ 251,563
7.250% due 08/31/96 500,000 506,563
7.250% due 11/15/96 250,000 254,140
8.000% due 01/15/97 250,000 256,953
6.750% due 02/28/97 900,000 912,938
6.375% due 01/15/99 1,300,000 1,324,375
6.375% due 07/15/99 350,000 356,890
6.000% due 10/15/99 1,550,000 1,563,077
6.250% due 02/15/03 500,000 508,750
-----------
Total U.S. Treasury Notes (cost $5,788,004) 5,935,249
-----------
<CAPTION>
- - --------------------------------------------------
MORTGAGE - BACKED SECURITIES - 22.53%
- - --------------------------------------------------
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
FEDERAL HOME LOAN MORTGAGE CORPORATION - 4.79%
7.500% due 06/01/07 $ 70,920 $ 71,609
6.250% due 01/15/09 417,388 406,461
8.250% due 03/01/12 139,896 143,853
8.500% due 03/01/16 242,116 250,582
8.500% due 06/15/17 400,000 402,504
7.500% due 07/01/17 132,984 133,951
11.000% due 04/01/19 247,195 272,864
10.500% due 05/01/19 159,413 174,259
11.000% due 11/01/19 341,287 376,727
-----------
2,232,810
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 2.95%
9.500% due 09/01/05 36,555 38,444
6.000% due 12/01/08 363,751 354,821
5.500% due 01/01/09 368,017 353,400
6.000% due 03/01/09 279,808 272,939
5.500% due 04/01/09 371,612 356,569
-----------
1,376,173
-----------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION - 1.03%
10.250% due 04/15/16 21,826 23,726
9.000% due 11/15/16 177,801 187,984
9.500% due 05/15/18 86,985 92,965
9.000% due 12/15/19 165,304 174,208
-----------
478,883
-----------
MISCELLANEOUS - 13.76%
FNMA Remic 93-12 ED (7.500% due 02/25/06) 1,000,000 1,027,030
FNMA Remic 92-18 HC (7.500% due 03/25/07) 400,000 413,060
FNMA Remic 93-163 PN (7.000% due 07/25/07) 250,000 255,220
FHLMC 1422 FA (5.970% due 11/15/07)<F1> 500,000 496,750
GNMA Remic 94-6 C (7.990% due 12/16/15) 1,384,338 1,402,501
Merrill Lynch Mortgage Investors 1992-F B
(6.938% due 09/15/17)<F1> 500,000 474,375
FNMA Remic 92-119 E (8.000% due 07/25/20) 500,000 517,150
FNMA Remic 92-112 (8.000% due 12/25/20) 780,000 808,782
FNMA Remic 93-127 FA
(5.240% due 10/25/21)<F1> 500,000 469,540
FNMA Remic 92-66 F (6.406% due 05/25/22)<F1> 555,365 557,008
-----------
6,421,416
-----------
Total Mortgage-Backed Securities
(cost $10,269,727) 10,509,282
-----------
<CAPTION>
- - --------------------------------------------------
CORPORATE BONDS AND NOTES - 7.07%
- - --------------------------------------------------
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
BANKS - 1.18%
Boatmens Bancshares, Inc. Sub. Note
(9.250% due 11/01/01) $ 240,000 $ 272,549
Comerica Inc., Sub. Note
(9.750% due 05/01/99) 250,000 275,086
-----------
547,635
-----------
FINANCIAL SERVICES - 0.49%
Pacific Gulf Properties, Inc. Sub.
Convertible Deb. (8.375% due 02/15/01) 250,000 230,625
-----------
GAMING - 0.57%
Circus Circus Enterprises, Inc. Senior
Sub. Note (10.625% due 06/15/97) 250,000 266,180
-----------
HOMEBUILDER- 0.56%
Toll Corporation Senior Sub. Note
(10.500% due 03/15/02) 250,000 260,625
-----------
INSURANCE - 0.52%
American Financial Group Note
(9.750% due 08/01/99) 120,000 120,521
Reliance Financial Services Corporation
Senior Note (9.480% due 11/01/00)<F1> 125,000 124,047
-----------
244,568
-----------
OIL & GAS EXPLORATION SERVICES - 1.38%
Columbia Gas Systems Inc. Deb.
(10.500% due 06/01/12)<F2> 250,000 376,946
Rowan Companies, Inc. Senior Note
(11.875% due 12/01/01) 250,000 268,750
-----------
645,696
-----------
SAVINGS & LOAN - 0.30%
Golden West Financial Corporation Sub.
Note (10.250% due 12/01/00) 120,000 139,271
TELEPHONE & TELECOMMUNICATIONS - 0.35%
United Telecommunications, Inc. Note
(9.750% due 04/01/00) 144,000 161,437
-----------
UTILITIES - ELECTRIC - 1.72%
Connecticut Light & Power Company
1st Ref Mtg. (7.625% due 04/01/97) 296,000 301,049
El Paso Electric 1st Mtg.
(6.750% due 05/01/98)<F2> 200,000 191,750
New Orleans Public Service Inc.
1st Mtg. Note (8.670% due 04/01/05) 300,000 309,406
-----------
802,205
-----------
Total Corporate Bonds and Notes
(cost $3,075,100) 3,298,242
-----------
<CAPTION>
- - --------------------------------------------------
SHORT-TERM INVESTMENTS - 18.88%
- - --------------------------------------------------
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
COMMERCIAL PAPER - 10.67%
Columbia Healthcare Corporation
(5.890% due 12/05/95) $1,000,000 $ 994,437
Nabisco Inc. (5.890% due 12/04/95) 1,000,000 994,601
Pennzoil Company (5.880% due 12/08/95) 1,000,000 993,957
Time Warner Entertainment Company
(6.000% due 11/10/95) 1,000,000 998,500
Union Pacific Corporation
(5.840% due 11/13/95) 1,000,000 998,053
-----------
4,979,548
-----------
VARIABLE RATE DEMAND NOTES<F3>- 8.21%
General Mills, Inc. (5.460% due 11/01/95) 1,909,639 1,909,639
Pitney Bowes Credit Corporation
(5.467% due 11/01/95) 1,185,676 1,185,676
Sara Lee Corporation (5.447% due 11/01/95) 488,619 488,619
Southwestern Bell Telephone Company
(5.447% due 11/01/95) 30,000 30,000
Warner Lambert Company (5.438% due 11/01/95) 207,670 207,670
Wisconsin Electric Power Company
(5.508% due 11/01/95) 7,552 7,552
-----------
3,829,156
-----------
Total Short-Term Investments (cost $8,808,704) 8,808,704
-----------
TOTAL INVESTMENTS - 98.66% (cost $41,969,615) 46,019,916<F4>
OTHER ASSETS AND LIABILITIES - 1.34% 624,070
-----------
TOTAL NET ASSETS - 100.00% $46,643,986
===========
- - --------
*Non-income producing
(ADR) American Depository Receipt
<FN>
<F1>
Interest rates vary periodically based on current market rates. Rates shown
are as of October 31, 1995.
<F2>
Interest payments in default.
<F3>
Interest rates vary periodically based on current market rates. The maturity
shown for each variable rate demand note is the later of the next scheduled
interest rate adjustment date or the date on which principal can be recovered
through demand. Information shown is as of October 31, 1995.
<F4>
Gross unrealized appreciation and depreciation of securities at October 31,
1995 for financial reporting purposes was $4,997,811 and $947,510 respectively;
tax amounts were substantially the same.
</FN>
</TABLE>
The accompanying notes are an integral part of the
financial statements.<PAGE>
<PAGE>
<TABLE>
<CAPTION>
CARILLON CAPITAL FUND
STATEMENT OF ASSETS AND LIABILITIES
=================================================================
OCTOBER 31, 1995
<S> <C>
ASSETS
Investments in securities,
at value (cost $41,969,615) $ 46,019,916
Cash 11,292
Receivable for investment securities sold 403,271
Interest and dividends receivable 261,263
Prepaid expenses 2,136
------------
46,697,878
------------
LIABILITIES
Professional fees 18,451
Investment advisory fees 29,801
Portfolio accounting and custody fees 1,866
Transfer agency fees 964
Printing expenses 1,534
Other 1,276
------------
53,892
------------
NET ASSETS
Paid-in capital 41,848,367
Accumulated undistributed net investment income 279,832
Accumulated undistributed net realized gain 465,486
Unrealized appreciation, net 4,050,301
------------
$ 46,643,986
============
Shares outstanding
(without par value, unlimited authorization) 3,673,615
============
Net asset value and redemption price per share $ 12.70
============
Offering price per share
(Net asset value per share/.95)* $ 13.37
============
</TABLE>
* A sales charge of 5% is imposed on investments of less than
$50,000. Reduced sales charges apply for investments in excess
of this amount.
The accompanying notes are an integral part of the financial
statements.
<PAGE>
<TABLE>
<CAPTION>
CARILLON CAPITAL FUND
STATEMENT OF OPERATIONS
============================================================
YEAR ENDED OCTOBER 31, 1995
<S> <C>
INVESTMENT INCOME
Interest $ 2,042,370
Dividends (net foreign withholding
taxes of $14,152) 338,548
------------
2,380,918
------------
EXPENSES
Investment advisory fees 327,862
Portfolio accounting fees 29,548
Professional fees 20,605
Trustees' fees 21,573
Custodial fees and expenses 11,027
Registration and filing fees 11,171
Transfer agency fees 10,924
Other 6,784
------------
439,494
------------
NET INVESTMENT INCOME 1,941,424
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investments 495,485
Net change in unrealized appreciation /
(depreciation) of investments 2,094,445
------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS 2,589,930
------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 4,531,354
============
</TABLE>
The accompanying notes are an integral part of the financial
statements.
<PAGE>
<TABLE>
<CAPTION>
CARILLON CAPITAL FUND
STATEMENTS OF CHANGES IN NET ASSETS
==================================================================
For the year ended October 31,
------------------------------
1995 1994
---- ----
<S> <C> <C>
OPERATIONS
Net investment income $ 1,941,424 $ 1,466,085
Net realized gain on investments 495,485 3,195,104
Net change in unrealized
appreciation/(depreciation) of investments 2,094,445 (2,875,627)
----------- -----------
4,531,354 1,785,562
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (1,797,101) (1,227,530)
Net realized gain on investments (3,369,426) (487,992)
----------- -----------
(5,166,527) (1,715,522)
----------- -----------
FUND SHARE TRANSACTIONS
Proceeds from shares sold 1,012,125 6,256,782
Net asset value of shares issued to
shareholders in reinvestment of dividends 5,166,372 1,715,522
Payments for shares redeemed (748,468) (56,406)
----------- -----------
5,430,029 7,915,898
----------- -----------
NET INCREASE IN NET ASSETS 4,794,856 7,985,938
NET ASSETS
Beginning of year 41,849,130 33,863,192
----------- -----------
End of year (including
undistributed net investment income of
$279,832 for 1995 and $286,864 for 1994) $46,643,986 $41,849,130
=========== ===========
FUND SHARE TRANSACTIONS:
Sold 81,022 481,658
Issued in reinvestment of dividends 438,699 132,777
Redeemed (61,626) (4,343)
----------- -----------
Net increase from share transactions 458,095 610,092
=========== ===========
</TABLE>
The accompanying notes are an integral part of the
financial statements.
<PAGE>
<PAGE>
CARILLON CAPITAL FUND
NOTES TO FINANCIAL STATEMENTS
=============================================================
OCTOBER 31, 1995
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Carillon Capital Fund (the Fund) is a series of Carillon
Investment Trust (the Trust) registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end
management investment company.
Securities valuation - Securities traded on securities exchanges
(including securities traded in both the over-the-counter market
and on an exchange), or listed on the NASDAQ National Market
System, are valued at the last sales price as of the close of the
New York Stock Exchange on the day of valuation, or if there were
no reported sales on that date, the last bid price. Securities
traded only in the over-the-counter market are valued at the last
bid price, as of the close of trading on the New York Stock
Exchange, quoted by brokers that make markets in the securities.
Other securities for which market quotations are not readily
available are valued at fair value as determined in good faith
by, or under procedures adopted by the Board of Trustees. Money
market instruments with a remaining maturity of 60 days or less
are valued at amortized cost which approximates market.
Securities transactions and investment income - Securities
transactions are recorded on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the
ex-dividend date and interest income is recorded on the accrual
basis. Gains and losses on sales of investments are calculated
on the identified cost basis for financial reporting and tax
purposes. The cost of investments is substantially the same for
financial reporting and tax purposes.
Federal taxes - It is the intent of the Fund to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
net investment income and any net realized capital gains.
Therefore, no provision for income or excise taxes has been
recorded.
Dividends and capital gains distributions - Dividends from net
investment income are declared and paid quarterly by the Fund.
Net realized capital gains are distributed periodically, no less
frequently than annually. Dividends from net investment income
and capital gains distributions are recorded on the ex-dividend
date. All dividends and distributions are automatically
reinvested in additional shares of the Fund at the net asset
value per share unless the shareholder requests such dividends
and distributions be paid in cash.
The amount of dividends and distributions are determined in
accordance with federal income tax regulations which may differ
from generally accepted accounting principles. These "book/tax"
differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature,
such amounts are reclassified within the capital accounts based
on their federal tax-basis treatment; temporary differences do
not require reclassification. Dividends and distributions which
exceed net investment income and net realized capital gains for
financial reporting purposes but not for tax purposes are
reported as dividends in excess of net investment income or
distributions in excess of net realized capital gains. To the
extent they exceed net investment income and net realized capital
gains for tax purposes, they are reported as distributions of
paid-in-capital.
NOTE 2 - TRANSACTIONS WITH AFFILIATES
Investment advisory fees - The Fund pays investment advisory fees
to Carillon Advisers, Inc. (the Adviser) under terms of an
Investment Advisory Agreement. Certain officers and directors of
the Adviser are affiliated with the Fund. The Fund pays the
Adviser, as full compensation for all services and facilities
furnished, a monthly fee computed on a daily basis, at an annual
rate of .75% of the first $50,000,000, .65% of the next
$100,000,000, and .50% of all amounts over $150,000,000 of the
net assets of the Fund.
The Investment Advisory Agreement provides that if, in any
calendar quarter, the total of all ordinary business expenses
applicable to the Trust should exceed the expense limitations as
required by any applicable state law, the Adviser will reimburse
the Trust for such excess. No such reimbursements were required
for the periods presented in the financial statements.
In addition to providing investment advisory services, the
Adviser is responsible for providing certain administrative
functions to the Fund. The Adviser has entered into an
Administration Agreement with Carillon Investments, Inc. (the
Distributor) under which the Distributor furnishes substantially
all of such services for an annual fee of .20% of the Fund's
average net assets. The fee is borne by the Adviser, not the
Fund.
Distribution agreement - The Distributor serves as the principal
underwriter of the shares of the Trust pursuant to a Distribution
Agreement with the Trust. Under the terms of this agreement, the
Distributor will pay all expenses related to selling and
distributing the Trust's shares, including preparing, printing
and mailing sales materials. The Distributor receives a
percentage of the offering price of fund shares sold to
unaffilated parties ranging from 5% on investment of less that
$50,000 to .5% on investments in excess of $2,500,000. During
the year ended October 31, 1995, the Distributor received
commissions of $315.
Other - At October 31, 1995, The Union Central Life Insurance
Company (Union Central) owned 2,999,068 shares of the Fund and
therefore is a controlling person of the Fund and is able to cast
a deciding vote on matters submitted to a vote of the Fund's
shareholders.
Union Central owns all of the outstanding stock of Carillon
Investments, Inc. and Carillon Advisers, Inc.
Each trustee who is not affiliated with the Adviser receives fees
from the Trust for services as a trustee.
NOTE 3 - SUMMARY 0F PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of securites for the year ended October 31,
1995, excluding short-term securities, follow:
<TABLE>
<CAPTION>
Cost of Purchases Proceeds from Sales
----------------- -------------------
<S> <C> <C>
Common Stocks $ 8,750,476 $ 4,327,716
U.S. Government Securities 7,718,253 7,621,147
Corporate Bonds 2,037,969 2,357,420
------------- ------------
$ 18,506,698 $14,306,283
============= ============
</TABLE>
NOTE 4 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding
throughout the year.
<TABLE>
<CAPTION>
<PAGE>
Year ended October 31,
--------------------------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year $13.01 $13.00 $12.45 $12.48 $ 9.79
------ ------ ------ ------ ------
Investment Operations:
Net investment income .52 .35 .42 .45 .46
Net realized and
unrealized gain .73 .16 1.27 .50 2.71
------ ------ ------ ------ ------
Total from Investment
Operations 1.25 .51 1.69 .95 3.17
------ ------ ------ ------ ------
Distributions:
Net investment income (.51) (.32) (.42) (.45) (.48)
Net realized gain (1.05) (.18) (.72) (.53) --
------ ------ ------ ------ ------
Total Distribution (1.56) (.50) (1.14) (.98) (.48)
------ ------ ------ ------ ------
Net Asset Value,
End of Year $12.70 $13.01 $13.00 $12.45 $12.48
====== ====== ====== ====== ======
Total Return <F1> 10.88% 4.56% 14.50% 8.15% 32.99%
Ratios/Supplemental Data:
- - ------------------------
Ratio of Expenses to
Average Net Assets 1.01% 1.05% 1.11% 1.10% 1.19%
Ratio of Net Investment
Income to Average
Net Assets 4.44% 3.89% 3.35% 3.61% 4.03%
Portfolio Turnover Rate 42.07% 53.20% 43.35% 48.03% 42.07%
Net Assets,
End of Year (000's) $46,644 $41,849 $33,863 $29,807 $27,384
<FN>
<F1>
Assumes sales load is not imposed on either intitial investment or reinvestment
of distributions.
</FN>
</TABLE>
<PAGE>
PART C
OTHER INFORMATION
<PAGE>
CARILLON INVESTMENT TRUST
PART C - OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
Included in Part B hereof are the following financial
statements of Registrant:
Report of Independent Accountants, November 28, 1995
Schedule of Investments, October 31, 1995
Statement of Assets and Liabilities, October 31, 1995
Statement of Operations for the year ended October 31,
1995
Statement of Changes in Net Assets for the two years ended
October 31, 1995
Notes to Financial Statements
(b) Exhibits
(1)(a) Declaration of Trust and Amendment No. 1
- previously filed (initial filing on
August 21, 1987)
(b) Amendment No. 2 - previously filed (Pre-Effective
Amendment No. 1 - December 30, 1987)
(c) Amendment No. 3 - previously filed (Post-Effective
Amendment No. 3 - February 28, 1990)
(2) By-Laws - previously filed (initial filing on
August 21, 1987)
(3) Not Applicable
(4) Not Applicable
(5)(a) Investment Advisory Agreement - previously filed
(Pre-Effective Amendment No. 1 - December 30, 1987)
(b) Administration Agreement - previously filed (initial
filing on August 21, 1987)
(c) Amendment to Administration Agreement - previously
filed (Post-Effective Amendment No. 3 - February 28,
1990)
(6)(a) Distribution Agreement - previously filed (Pre-
Effective Amendment No. 1 - December 30, 1987)
(b) Amendment to Distribution Agreement - previously
filed (Post-Effective Amendment No. 2 - February 28,
1989)
(7) Not Applicable
(8) (a) Custodian Agreement - previously filed (Post-
Effective Amendment No. 3 - February 28, 1990)
(b) Portfolio Accounting Agreement - previously filed
(Post-Effective Amendment No. 3 - February 28, 1990)
(9) Transfer Agency Agreement - previously filed (Post-
Effective Amendment No. 3 - February 28, 1990)
(10) Opinion and Consent of Counsel - previously filed (Pre-
Effective Amendment No. 2 - February 12, 1988)
(11) (a) Consent of Deloitte & Touche LLP - filed herewith
(b) Consent of Price Waterhouse - filed herewith
(12) Not Applicable
(13) Form of Contribution Agreement - previously filed (Pre-
Effective Amendment No. 1 - December 30, 1987)
(14) IRA Disclosure Statement - previously filed (Pre-
Effective Amendment No. 1 - December 30, 1987)
(15) Not Applicable
(16) Performance Computations - previously filed (Post-
Effective Amendment No. 8)
(17) (a) Application Form - previously filed (Post-Effective
Amendment No. 6 - February 28, 1993)
(b) Supplemental Application - previously filed (Post-
Effective Amendment No. 7 - February 25, 1994)
(18) Powers of Attorney - previously filed (Pre-Effective
Amendment No. 1 - December 30, 1987; Post-Effective
Amendment No. 4 - February 28, 1991; Post-Effective
Amendment No. 6 - February 28, 1993)
Item 25. Persons Controlled by or Under Common Control with
Registrant
At January 31, 1996, approximately 77% of Registrant's
shares were owned by The Union Central Life Insurance Company
("UC"). Set forth below is a chart showing the entities
controlled by or affiliated with UC, the jurisdictions in which
such entities are organized, and the percentage of voting
securities owned by the person immediately controlling each such
entity.<PAGE>
<PAGE>
THE UNION CENTRAL LIFE INSURANCE COMPANY,
its Subsidiaries and Affiliates
I. The Union Central Life Insurance Company (Ohio)
A. Carillon Investments, Inc. (Ohio) - 100% owned
B. Carillon Marketing Agency, Inc. (Delaware) - 100% owned
a. Carillon Marketing Agency of Alabama, Inc. (Alabama)
- 100% owned
b. Carillon Marketing Agency of Idaho, Inc. (Idaho)
- 100% owned
c. Carillon Marketing Agency of Kentucky, Inc. (Kentucky)
- 100% owned
d. Carillon Marketing Agency of Maine, Inc. (Maine) -
100% owned
e. Carillon Insurance Agency of Massachusetts, Inc.
(Massachusetts) - 100% owned
f. Carillon Marketing Agency of New Mexico, Inc.
(New Mexico) - 100% owned
g. Carillon Marketing Agency of Ohio, Inc. (Ohio)
- 100% owned
h. Carillon Marketing Agency of Pennsylvania, Inc.
(Pennsylvania) - 100% owned
i. Carillon Marketing Agency of Texas, Inc.
(Texas) - 100% owned
C. Carillon Advisers, Inc. (Ohio) - 100% owned
a. First Summit Capital Management (Ohio)- 51% owned
D. The Manhattan Life Insurance Company (New York)
- 73% owned
II. Mutual Funds of the Carillon Group
A. Carillon Fund, Inc.* (Maryland)
B. Carillon Investment Trust** (Massachusetts)
* At January 31, 1996, The Union Central Life Insurance Company
owned 100% of the outstanding shares of Carillon Fund, Inc.
** At January 31, 1996, The Union Central Life Insurance
Company owned 77% of the outstanding shares of the Trust.
III. Summit Investment Trust (Massachusetts) - a mutual fund
whose investment adviser is First Summit Capital
Management
Item 26. Number of Holders of Securities
<TABLE>
<CAPTION>
Number of Record
Title of Class Holders as of December 31, 1995
- - -------------- -------------------------------
<S> <C>
Carillon Capital Fund 45
</TABLE>
***
Item 28. Business and other Connections of Investment Adviser
Information regarding the principal officers and directors of
Carillon Advisers, Inc. ("CAI") and their business, profession
or employment of a substantial nature during the last two years
is set forth below. The address of all the persons listed below
is 1876 Waycross Road, Cincinnati, Ohio 45240.
<TABLE>
<CAPTION>
Name and Position with Principal Occupation(s)
Address the Adviser During Past Two Years
- - -------- ------------- -------------------------
<S> <C> <C>
Harry Rossi Director Director Emeritus, The Union
Central Life Insurance
Company("UC"); Director,
Carillon Group of Mutual
Funds; prior thereto,
Director, UC
<PAGE>
Larry R. Pike Director Chairman, President and
Chief Executive Officer, UC
George L. Clucas Director, Senior Vice President, UC;
President Director, President and
and Chief Chief Executive Officer,
Executive Carillon Group of Mutual
Officer Funds
Steven R. Vice President Vice President, UC; prior
Sutermeister thereto, Senior Vice
President, Washington
Square; prior thereto,
Marketing Analyst, Salomon
Brothers
D. Stephen Cole Vice President Vice President, UC
Thomas G. Knipper Treasurer Assistant Controller, UC;
Controller, Carillon Group
of Mutual Funds; prior
thereto, Treasurer of The
Gateway Trust and Vice
President and Controller of
Gateway Advisers, Inc.
John F. Labmeier Secretary Second Vice President,
Associate General Counsel
and Assistant Secretary, UC;
Vice President and
Secretary, Carillon Group of
Mutual Funds and
Carillon Investments, Inc.
</TABLE>
Item 29. Principal Underwriters
(a) The principal underwriter of Registrant is Carillon
Investments, Inc. Carillon Investments, Inc. also acts as
principal underwriter for the Carillon Account of UC.
(b) The officers and directors of Carillon Investments, Inc.
and their positions, if any, with Registrant are shown below.
The business address of each is 1876 Waycross Road, Cincinnati,
Ohio 45240.
<TABLE>
<CAPTION>
Name and Position with
Carillon Investments, Inc. Position with Registrant
- - ---------------------------- -------------------------
<S> <C>
George L. Clucas Director, President and Chief
Director Executive Officer
Charles W. Grover None
Director
John H. Jacobs Director
Director
Elizabeth G. Monsell None
Director and President
Larry R. Pike None
Director
Lothar A. Vasholz None
Director
Kevin W. O'Toole None
Vice President
Patricia A. Stalder None
Treasurer
John F. Labmeier Vice President and Secretary
Vice President and Secretary
Patricia M. Heim None
Compliance Officer
John M. Lucas Assistant Secretary
Assistant Secretary
</TABLE>
(c) Carillon Investments, Inc. received $1,576 in aggregate
commissions from the sale of Trust shares for the year ended
October 31, 1995. Of this amount, Carillon Investments, Inc.
retained $315.
Item 30. Location of Accounts and Records
Firstar Trust Company (formerly known as First Wisconsin Trust
Company), Mutual Fund Services, P.O. Box 701, Milwaukee, WI
53201-0701, acts as custodian of the Registrant's assets and is
its bookkeeping, transfer and dividend disbursing agent. It
maintains books, records and accounts of the Registrant required
to be maintained pursuant to Section 31(a) of the Investment
Company Act of 1940 and the rules promulgated thereunder.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of its latest annual report
to shareholders, upon request and without charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933
and the Investment Company Act of 1940, the Registrant, Carillon
Investment Trust, certifies that it meets all of the
requirements for effectiveness of this Post-effective Amendment
to the Registration Statement pursuant to Rule 485(b) under the
Securities Act of 1933 and has duly caused this Post-effective
Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the
City of Cincinnati, State of Ohio on the 28th day of February,
1996.
CARILLON INVESTMENT TRUST
(SEAL)
Attest: /s/ John F. Labmeier By: /S/ George L. Clucas
George L. Clucas, President
Pursuant to the requirements of the Securities Act of 1933,
this Post-effective Amendment to the Registration Statement has
been signed below by the following persons in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- - --------- ----- ----
<S> <C> <C>
/s/ George L. Clucas President and 2/28/96
George L. Clucas Trustee(Principal
Executive Officer)
/s/ Thomas G. Knipper Controller 2/28/96
Thomas G. Knipper (Principal Financial
and Accounting
Officer)
*/s/ George M. Callard, M.D. Trustee 2/28/96
George M. Callard, M.D.
*/s/ Theodore H. Emmerich Trustee 2/28/96
Theodore H. Emmerich
*/s/ James M. Ewell Trustee 2/28/96
James M. Ewell
*/s/ Richard H. Finan Trustee 2/28/96
Richard H. Finan
*/s/Jean Patrice Harrington,S.C. Trustee 2/28/96
Jean Patrice Harrington, S.C.
*/s/ John H. Jacobs Trustee 2/28/96
John H. Jacobs
*/s/ Charles W. McMahon Trustee 2/28/96
Charles W. McMahon
*/s/ Harry Rossi Trustee 2/28/96
Harry Rossi
</TABLE>
*/ By /s/ John F. Labmeier, pursuant to Power of Attorney
previously filed.
<PAGE>
TABLE OF EXHIBITS
(11)(a) Consent of Deloitte & Touche LLP
(11)(b) Consent of Price Waterhouse LLP
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Post-Effective Amendment No. 9 to
Registration Statement under the Securities Act of 1933 and
Amendment No. 11 to Registration Statement under the Investment
Company Act of 1940, both filed under Registration Statement No.
33-16665 of our report dated November 28, 1995 on the financial
statements of the Carillon Capital Fund of Carillon Investment
Trust, appearing in the Statement of Additional Information,
which is part of such Registration Statement and to the
reference to us as experts, under the caption "Independent
Auditors" in the Statement of Additional Information.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Dayton, Ohio
February 22, 1996
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Statement of Additional
Information constituting part of this Post-Effective Amendment
No. 9 to the registration statement on Form N-1A (the
"Registration Statement") of our report dated December 2, 1994,
relating to the financial statements and financial highlights of
The Carillon Capital Fund of the Carillon Investment Trust,
which appears in such Statement of Additional Information, and
to the incorporation by reference of our report into the
Prospectus which constitutes part of this Registration
Statement. We also consent to the reference to us under the
heading "Financial Highlights" in such Prospectus.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Cincinnati, Ohio
February 21, 1996
