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. 13 X
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 15 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:
Sutherland, Asbill & Brennan, L.L.P.
1275 Pennsylvania Ave., N.W.
Washington, D.C. 20004
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b) of Rule
485
on (date) pursuant to paragraph (b) of Rule 485
60 days after filing pursuant to paragraph (a)(1) of Rule
485
X on February 28, 1999 pursuant to paragraph (a)(1) of Rule
485
75 days after filing pursuant to paragraph (a)(2) of Rule
485
on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
This post-effective amendment designates a new effective
date
for a previously filed post-effective amendment.
<PAGE>
PART A
INFORMATION REQUIRED IN A PROSPECTUS
<PAGE>
PROSPECTUS
Carillon Capital Fund
of
Carillon Investment Trust
Carillon Capital Fund (the "Fund") is an investment portfolio of
Carillon Investment Trust (the "Trust"). The Trust is a
diversified, open-end management investment company, commonly
known as a "mutual fund".
The Fund's investment objective is 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 stocks, investment-grade debt, junk bonds and money
market instruments.
As a result of the market risk inherent in any investment, there
is no assurance that the Fund will realize its investment
objective. Investments in the Fund are neither insured nor
guaranteed by the U.S. Government or any other entity or person.
-------------------
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED THE
FUND'S SHARES AS AN INVESTMENT AND HAS NOT DETERMINED THAT THIS
PROSPECTUS IS COMPLETE OR ACCURATE. IT IS AGAINST THE LAW FOR
ANYONE TO TELL YOU OTHERWISE.
February 28, 1999
<PAGE>
TABLE OF CONTENTS
Page
RISK/RETURN SUMMARY -- OBJECTIVE, PRINCIPAL
STRATEGIES, AND RISKS......................................3
RISK/RETURN SUMMARY: FUND PERFORMANCE......................5
RISK/RETURN SUMMARY: FEE TABLE.............................6
THE FUND'S OBJECTIVE.........................................7
PRINCIPAL RISKS TO INVESTORS.................................9
MANAGEMENT OF THE TRUST.....................................12
SHAREHOLDER INFORMATION.....................................13
DIVIDENDS AND DISTRIBUTIONS.................................17
TAXES.......................................................17
PREPARING FOR YEAR 2000.....................................18
FINANCIAL HIGHLIGHTS........................................19
<PAGE>
RISK/RETURN SUMMARY -- OBJECTIVE, PRINCIPAL STRATEGIES, AND
RISKS
<TABLE>
<S> <C>
Fund's Investment To provide the highest total return through
Objective 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. We cannot change this objective
without shareholder approval.
Principal The Fund invests in a mixture of stocks,
Investment investment-grade bonds, high-yield bonds
Strategies (commonly known as "junk bonds"), and money
market instruments. The investment adviser
will select investments based on its
perception of an investment's fundamental
value, the historical returns of stocks,
bonds and money market securities, and
other market factors.
Principal Risks to The net asset value of Fund shares rises or
Investors falls along with changes in the market
values of the securities owned by the Fund.
These values can be affected by general
risks that affect any investment in a free
market, such as changes in the economy as a
whole, changes in interest rates, or changes
in the market's perception of securities
that the Fund holds. We cannot assure you
that the Fund will achieve its investment
objective. You may lose money when you sell
Fund shares.
Market changes may be rapid, unpredictable
and unrelated to particular issuers. The
Fund's investment adviser may fail to
identify stocks or bonds that produce
capital growth. The investment adviser may
not properly ascertain the appropriate mix
of securities for any particular economic
cycle.
Junk bonds can be especially sensitive to
changes in interest rates and other economic
factors. Issuers of junk bonds may default
on interest or principal payments, or may go
bankrupt.
Foreign securities involve additional risks,
such as political, economic or regulatory
factors in foreign countries that affect the
securities or their issuers.
Who May Want Risk-oriented investors who are willing to
To Invest: accept investment risk in the pursuit of a
higher level of income, who have a longer
time horizon, and who are willing to risk
volatility over the short term. By itself,
the Fund is not a balanced investment
program.
Who Should Not Investors who seek a regular and stable
Invest: income to meet current expenses, or any
investor who requires stability of
principal.
</TABLE>
RISK/RETURN SUMMARY: FUND PERFORMANCE
The chart and table below show how an investment in the Fund has
varied over time. The returns shown assume that any dividends
and distributions have been reinvested in the Fund.
The table compares the Fund's annual performance over the
periods shown with the S&P 500 Stock Index, a widely known
unmanaged index of stock performance. Although past performance
does not necessarily indicate how the Fund will perform in the
future, this information can give you some indication of the
risk of your investment in the Fund.
Year-By-Year Returns(1) as of 12/31 Each Year(2)
[The bar chart displayed here shows the Total Returns for the
calendar years as follows:
26.48%, 1989
-0.58%, 1990
26.46%, 1991
7.85%, 1992
14.11%, 1993
1.37%, 1994
14.85%, 1995
14.97%, 1996
6.69%, 1997
-6.19%, 1998 ]
(1) The bar chart does not reflect sales loads. If it did,
returns would be lower than those shown.
(2) The Fund operates on a fiscal year that ends on October 31.
The annualized rate of return for the most recent quarter ending
January 31, 1999 was[___%].
Best Quarter: First Quarter 1991 13.57%
Worst Quarter: Third Quarter 1990 -9.82%
Average Annual Total Returns as of December 31, 1998
[CAPTION]
<TABLE>
One Five Ten Life of
Year Years Years Fund<F3>
<S> <C> <C> <C> <C>
Carillon Capital Fund -6.19% 6.02% 9.17% 9.19%
S&P 500 28.58% 24.03% 19.17% 18.30%
<FN>
<F3> The Fund commenced operations on February 23, 1988.
</FN>
</TABLE>
The table shows the Fund's performance over various periods of
time as compared to the S&P 500 Stock Index. This should
provide you with a basis to compare the Fund's performance with
that of the market.
RISK/RETURN SUMMARY: FEE TABLE
Fees and Expenses of the Fund
This table describes the fees and expenses that you may pay if
you buy and hold shares of the Fund.
Shareholder Fees (paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases
(as a percentage of offering price)............5.00%
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
Management Fees................................0.75%
Other Expenses.................................0.36%
Total Annual Fund Operating Expenses...........1.11%
Example
This example is intended to help you compare the cost of
investing in the Fund with the cost of investing in other mutual
funds.
The Example assumes that you invest $10,000 in the Fund for the
time periods indicated and then redeem all your shares at the
end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Fund's
operating expenses remain the same. Although your actual costs
may be higher or lower, based on these assumptions your costs
would be:
1 Year 3 Years 5 Years 10 Years
---------------------------------------------------------
Expenses $158 $387 $634 $1,339
THE FUND'S OBJECTIVE
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.
There can be no assurance that the Fund's investment objective
will be realized.
How the Fund Pursues its Objective
The investment adviser will invest the Fund's assets in stocks,
bonds, and money market instruments. The Fund is a "total
return" fund, meaning that the investment adviser considers both
growth and income.
The investment adviser will decide on the proportion of Fund
assets to invest in different kinds of securities based on its
analyses of fundamental value; historical long term returns
among equity, debt and money market securities; and other market
influencing factors. There are no percentage limitations on the
class of securities in which the Fund may invest. The Fund may
be invested entirely in stocks, entirely in bonds, entirely in
money market securities, or in any combination of these
securities at the sole discretion of the investment adviser,
subject only to the investment objective and the policies
adopted by the Board of Trustees.
The investment adviser will consider, over both the short and
the long term, the following aspects of an investment:
- corporate profitability;
- short and long-term interest rates;
- stock price-to-earnings ratios for the market as a
whole, and for individual stocks; and
- inflation rates.
A typical distribution of portfolio investments, if market
conditions are along historical lines, might be 63% in stocks,
30% in debt and 7% in money market securities. The investment
adviser may change these percentages because of market factors.
The investment adviser will also consider market influencing
factors relating to monetary policy, equity momentum, market
sentiment, economic influences and market cycles in making the
asset allocation decision.
Unless otherwise specified, the Fund's investment objectives,
policies and restrictions are not fundamental policies and may
be changed without shareholder approval.
Equity Securities
The investment adviser will consider a combination of several
themes in order to diversify the Fund's equity investment
exposure. Most of the Fund's stock investments 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 securities of companies judged to represent
better fundamental value than those of similar domestic
companies; or
- 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 U.S. Government debt and corporate debt. The Fund's
corporate debt investments will primarily be in "investment
grade" corporate bonds. These are bonds rated BBB or higher by
Standard & Poor's or Baa or higher by Moody's, or that are
unrated but that the investment adviser considers to have
equivalent credit quality.
Up to 25% of the Fund's assets may be invested in debt
securities that are below investment grade, commonly known as
"junk bonds." Junk bonds typically have a higher yield than
investment grade bonds, but they are a riskier investment. They
are considered to have speculative characteristics, and are
subject to greater market fluctuations and risk of loss of
income and principal than lower yielding fixed-income
securities.
The investment adviser anticipates that average maturity of the
Fund's long-term debt securities will not exceed 15 years. The
precise term to maturity will depend upon general market and
economic conditions.
Foreign Securities
The investment adviser may invest up to 35% of the Fund's assets
in foreign securities. These include equity and debt securities
of corporate issuers whose principal stock or bond exchange
listing is outside of the United States, American Depositary
Receipts ("ADRs") that hold such securities, and bonds issued by
foreign governments or foreign government agencies. To limit
the risks of investing in any one country, the Fund limits not
only its total purchases of foreign securities, but also its
purchases of securities of issuers in any single country.
Money Market Investments
The Fund may at any time be 100% invested in money market
instruments. Typically, however, the Fund will invest on a
limited basis in these instruments. The investment adviser may
temporarily increase the Fund's investment in the money market
as a holding place for cash pending investment or distribution.
In response to adverse market, economic or political conditions,
the investment adviser may invest Fund assets in money market
and short-term debt securities as a temporary defensive
position. If the Fund takes such a position, it may not achieve
its investment goal.
PRINCIPAL RISKS TO INVESTORS
Stock Market Risks
Investors could lose money in the Fund's equity investments, or
the Fund's performance could fall below other possible
investments, if any of the following occurs:
- The U.S. or foreign stock markets go down
- Smaller capitalization, historically profitable, lower
price earnings stocks which the fund favors, are
temporarily out of favor
- An adverse event such as a negative press report about
a company's earnings in the Fund's portfolio depresses
the value of the company's stock
- The investment adviser's judgment about the value or
potential appreciation of a particular stock proves to
be incorrect
- Issuers pay lower dividends than expected, or pay no
dividends at all
- Industry groups favored by fund management may
experience adverse economic conditions
Debt Risks
Investors could lose money in the Fund's debt investments, or
the Fund's performance could fall below other possible
investments, if any of the following occurs:
- Interest rates go up causing the market values of debt
securities in the Fund to fall (market risk)
- The issuer of a debt security in the Fund faces
economic problems and it defaults on its obligation to
pay principal or interest, has its credit rating
downgraded, or is perceived by the market to be less
creditworthy (company risk)
- As a result of declining interest rates, the issuer of
a security exercises its right to prepay principal
forcing the Fund to reinvest in lower-yielding
securities ("call risk")
- As a result of rising interest rates the issuer of a
security exercises its right to pay principal later
than scheduled which will lock in a below-market
interest rate and reduce the value of the security
("extension risk")
- The investment adviser's judgment about the value or
potential appreciation of a particular bond proves to
be incorrect ("manager's/selection risk")
Junk Bond Risks
Besides the Debt Risks listed above, there are particular risks
associated with junk bonds. Junk bonds generally include any
bonds rated Ba or below by Moody's, or rated BB or below by
Standard & Poor's, or unrated bonds which the Fund's investment
adviser considers to be of equivalent quality. The Fund may
invest up to 25% of the total value of its portfolio in junk
bonds at or below these ratings. Generally, the lower the
rating, the higher the interest rate, but the higher the risk as
well.
Junk bonds are speculative and have only an adequate capacity to
pay principal and interest. Junk bonds can be very sensitive to
changes in interest rates, the economy, and corporate
developments. Issuers of junk bonds may default on payments of
interest or principal, and the Fund may lose money on such
investments. Even if no issuer defaults, the Fund can still
lose money on junk bond investments because of changes in market
prices.
Junk bonds tend to be less liquid and may be more difficult to
value or sell. There may be little trading in the secondary
market for particular bonds, which may adversely affect the
Fund's ability to value precisely or dispose of such bonds.
Adverse publicity and investor perceptions, whether or not based
on fundamental analysis, may decrease the values and liquidity
of junk bonds, especially in a thin market.
Junk bonds may contain redemption or call provisions. If an
issuer were to exercise 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. If the Fund were to experience unexpected net
redemptions due to fund specific or market related events, it
could be forced to dispose of investments, thereby decreasing
the asset base upon which expenses could be spread and possibly
reducing the Fund's rate of return.
Foreign Market Risks
Investing in foreign securities, and particularly those of
emerging markets, also involves risk. Investors could lose
money on their investments, or the Fund may not perform as well
as other investments, because of the following risks:
- Currency fluctuations may negatively impact the Fund's
portfolio even if the foreign stock has not declined in
local currency value
- Balances of payments, other economic and financial
conditions, government intervention and other factors
could affect a foreign obligor's ability to make timely
payments on its external debt obligations
- In a changing market, the Fund may be delayed in
selling, or may not be able to sell, securities in
desired amounts at prices it considers reasonable
- Stock prices in countries selected by the Fund may
decline
- The government of a country selected by the Fund may
impose restrictions on currency conversion or trading
- Relationships among a country selected for investment
by the Fund, and other countries could change and
negatively impact stock or currency values
Many of the foreign markets in which the Fund invests are less
liquid, more volatile, and less subject to governmental
supervision than the U.S. markets. It may be harder to obtain
public information about a foreign security or issuer than in
the U.S. Unfavorable political, economic or regulatory factors,
including foreign taxation, may affect an issuer's ability to
repay principal, interest or dividends. In addition, many
emerging market countries have experienced substantial rates of
inflation for many years, which may adversely affect the
economies and securities markets of these countries. If a
foreign issuer defaulted on its obligation, it could be
difficult to obtain or to enforce a legal judgment against the
issuer.
Foreign markets, especially emerging markets, may have different
clearance and settlement procedures, and in certain markets
there have been times when settlements have been unable to keep
pace with the volume of securities transactions, making it
difficult to conduct such transactions.
Euro Conversion
On January 1, 1999, certain participating countries in the
European Economic Monetary Union adopted the "Euro" as their
official currency. Other EU member countries may convert to the
Euro at a later date. As of January 1, 1999, governments in
participating countries issued new debt and redenominated
existing debt in Euros; corporations may choose to issue stocks
or bonds in Euros or national currency. The new European
Central Bank (the "ECB") will assume responsibility for a
uniform monetary policy in participating countries. Euro
conversion risks that could affect the Funds' foreign
investments include: (1) the readiness of Euro payment,
clearing, and other operational systems; (2) the legal treatment
of debt instruments and financial contracts in existing national
currencies rather than the Euro; (3) exchange-rate fluctuations
between the Euro and non-Euro currencies during the transition
period of January 1, 1999 through December 31, 2001 and beyond;
(4) potential U.S. tax issues with respect to Fund securities;
and (5) the ECB's abilities to manage monetary policies among
the participating countries.
Money Market Risks
Because interest rates on money market instruments fluctuate in
response to economic factors, rates on the Fund's short-term
investments will vary, rising or falling with short-term
interest rates generally. Yields from short-term securities are
usually lower than yields from longer-term securities. Also,
the value of the Fund's securities varies inversely with
interest rates, the amount of outstanding debt and other
factors. This means that the value of the Fund's investments
increases as short-term interest rates fall and decreases as
short-term interest rates rise.
The Fund's Money Market investments may be unprofitable in a
time of sustained high inflation and rising interest rates.
There is uncertainty in every investment. Therefore, it is also
possible you may lose money because of the Fund's Money Market
investments.
Asset Allocation Risk
In order to meet the Fund's investment objectives, the
investment adviser must determine the proper mix of equity, debt
and money market securities. It may not properly ascertain the
appropriate mix of securities for any particular economic cycle.
Also, the timing of movements from one type of security to
another could have a negative effect on the Fund's overall
objective.
Portfolio Turnover
For the year ended October 31, 1998, the annual portfolio
turnover rate was 75.5%. Portfolio turnover means the rate at
which the securities held by the Fund are replaced. The higher
the rate, the higher the transactional and brokerage costs,
unless the securities traded can be bought and sold without the
Fund paying commission.
The investment adviser manages Fund to achieve its investment
objective of highest total return. The impact of federal and
state income taxation is one factor, but by no means a
predominant factor, in the Fund's investment activity, since the
Fund's total return is greatly influenced by timely asset sales
which usually generate tax consequences. See "Taxes," page ___.
MANAGEMENT OF THE TRUST
Investment Adviser
Carillon Advisers, Inc. (the "Adviser") serves as the Trust's
investment adviser under an Investment Advisory Agreement
("Agreement") originally dated December 30, 1987.
The 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. The Adviser is a wholly-owned subsidiary of
The Union Central Life Insurance Company ("Union Central"), a
mutual life insurance company organized in 1867 under the laws
of Ohio.
The Agreement provides that, subject to the control and
direction of the Board of Trustees, the Adviser will manage the
investment and reinvestment of the assets of the Fund in
accordance with its investment objectives and policies. In
addition, the Adviser agrees to formulate and implement a
continuing program for the management of the Fund's assets. The
Agreement requires the Adviser to make and execute all
investment decisions, and to place orders for the purchase and
sale of securities with or through such brokers, dealers or
issuers as it may select.
The Agreement also requires the Adviser to furnish or to provide
to the Fund any necessary office space, equipment and personnel,
clerical services, and other necessary office expenses, and to
provide the services of individuals who perform executive and
administrative functions for the Fund. In order to fulfill
these obligations, the Adviser has entered into an
Administration Agreement with Carillon Investments, Inc. to
furnish such services for which the 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.
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 Union Central since
1987.
Advisory Fee
Pursuant to the Agreement between the Fund and the Adviser, the
Fund pays the 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. For the fiscal
year ended October 31, 1998, the Fund paid the Adviser an
aggregate fee equal to .75% of the Fund's average net assets.
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 recognizes "economies of size" and
the fixed costs associated with managing any fund.
SHAREHOLDER INFORMATION
Pricing of Fund Shares
The net asset value of the Fund's shares is determined once each
day, Monday through Friday at 4:00 p.m. Eastern Time, on days
there are purchases or redemptions of Fund shares. The net
asset value will not be determined when the New York Stock
Exchange is closed, or on any day on which changes in the value
of the portfolio securities of the Fund are immaterial. The net
asset value is calculated 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 the
Fund's outstanding shares. Expenses, including the advisory fee
payable to Adviser, are charged to the Fund daily.
Securities held by the Fund are valued at market price.
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
at the amortized cost method.
Sometimes foreign securities markets are open on days when U.S.
markets are closed. Because the Fund holds foreign securities,
there may be days when the net asset value of Fund shares
changes even when the shares are not priced, and Fund
shareholders cannot purchase or redeem shares.
Purchase of Fund Shares
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 the transfer agent receives an order to
purchase, plus a sales charge. Shares are sold directly by the
Fund's underwriter, Carillon Investments, Inc. P.O. Box 40409,
Cincinnati, Ohio 45240. You can also submit an application and
purchase order to a broker-dealer which has a selling agreement
with Carillon Investments, Inc. Your initial investment must be
at least $500 and subsequent investments must be at least $50.
You can make subsequent purchases of shares by wire, by check,
by automatic deductions from your checking account, or by
sending money directly to the Fund's transfer agent.
Sales Charges
A sales charge is deducted from investments in the Fund
shares--essentially, the term "offering price" includes a front-
end sales load. The amount of the sales charge varies with the
total amount invested. The following is a table of sales
charges applied against investment in shares:
<TABLE>
<CAPTION>
Amount Invested Percent of Percent of
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, If your total investment were $5,000, $250 would be
deducted and the net amount invested would be $4,750. This $250
would be 5% of the purchase payment and 5.26% of the net amount
invested.
Reduced Sales Charge
You can purchase Fund shares 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 in
order to qualify for reduced sales charges.
(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 be
ing 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.
If your have a question about purchasing shares, contact the
Distributor or your broker.
Redemption of Shares
You can dispose of Fund shares and receive cash for them by
sending a written request for redemption to: Firstar Mutual
Fund Services, LLC, P.O. Box 701, Milwaukee, Wisconsin
53201-0701. You can also redeem shares by telephoning Firstar at
1-888-259-7565, or by telegraph, if you picked this option on
your shareholder's application form.
If Firstar receives a written request for redemption in "good
order" as described below, it will, acting as transfer agent for
the Fund, send you a check equal to the amount of the net asset
value of the redeemed shares next determined after it receives
the request. If Firstar receives the request before 4:00 p.m.
Eastern Time, it will redeem the shares at the net asset value
per share determined at 4:00 p.m. Eastern Time on that day. If
it receives a request after 4:00 p.m. Eastern Time, Firstar will
execute the request at the net asset value determined at 4:00
p.m. Eastern Time on the next trading day.
Firstar will normally send the check immediately after
redemption. However, the Fund 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 if you redeem shares shortly after buying them, where a
sales charge was deducted from the investment. If you paid for
shares by check (including certified or cashier's checks), then
Firstar would not disburse the proceeds from the redemption
request until 15 days after it had received the check paying for
them, to allow the check to clear.
A written redemption request is considered to be 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,
the Distributor, or by a member firm of the New York,
American, Boston, Midwest, Pacific or Philadelphia Stock
Exchanges.
If you request it on the original application for a Fund
account, Firstar will honor telephone or telegraphic
instructions for redemption 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 bank must
be a member of the Federal Reserve System. A charge of
$12.00 is imposed for Fed wires. Firstar sets this charge,
and may change it.
(b) Telephone redemption requests must be for less than $10,000
and will be mailed only to the account address appearing on
our records. Redemptions will be priced at the next cal
culated net asset value after the transfer agent receives
the request. You may request redemption by phone by
calling the transfer agent at 1-888-258-7565 between 9:00
a.m. and 8:00 p.m. Eastern Time, on Monday through Friday
(except 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.
The transfer agent may require other supporting legal documents
from corporations or other organizations, fiduciaries or persons
other than the shareholders of record making the request for
redemption.
We have 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, you may
withdraw your request for redemption, or you may receive payment
based upon the net asset value next determined after the
suspension is lifted.
Because of the high cost of maintaining small accounts, we 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 we so elect, we will notify the shareholder in
writing that an account has a value of less than $500, and will
allow 30 days for the shareholder to make an additional
investment in order to avoid having the account closed.
Note
Shareholders are advised that during periods of drastic economic
or market changes, telephone and telegraphic procedures may be
difficult to implement. If you are unable to place an order or
request a redemption via the telephone or telegraph, you should
make a written request instead.
DIVIDENDS AND DISTRIBUTIONS
The investment adviser intends to distribute quarterly
substantially all of the Fund's 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). The Fund will
distribute all net realized capital gains, if any, at least once
a year. We will automatically reinvest all dividends and
capital gains distributions in additional shares at net asset
value unless you request them to be paid in cash.
TAXES
The Fund intends to elect and qualify as a regulated investment
company. As a regulated investment company under the Internal
Revenue Code. 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. However, the Fund will be subject to tax at
regular corporate rates on any income or gains that are not
distributed as required.
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.
The Fund must pay a 4% nondeductible excise tax to the extent
that it 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 (which may include
dividends, capital gain distributions, and share redemption
proceeds) if the shareholder has not provided an accurate
taxpayer identification number to the Trust, in a manner
provided by IRS regulations.
PREPARING FOR YEAR 2000
Like all financial services providers, the Adviser and the
Distributor use systems that may be affected by Year 2000
transition issues. The Fund also relies on service providers,
including the Fund's custodian, transfer agent, and dividend
disbursing agent, that may be affected. The Adviser and
Distributor have advised the Fund that they have developed, and
are in the process of implementing, a Year 2000 transition plan.
The Fund's Management is in the process of confirming that the
service providers to the Fund are also engaged in similar
transition plans. While the Adviser and Distributor have made
representations to Management that each party is implementing a
Year 2000 transition plan, the resources that are being devoted
to this effort are substantial and it is difficult to predict
with precision whether the amount of resources ultimately
devoted, or the outcome of these efforts, will have any negative
impact on their operations. However, as of the date of this
Prospectus, Fund Management does not anticipate that
shareholders will experience negative effects on their
investment, or on the services provided in connection therewith,
as a result of Year 2000 transition implementation. The Adviser
and Distributor have advised Management that they currently
anticipate that their systems will be Year 2000 compliant on or
about June 30, 1999, but there can be no assurance that they
will be successful, or that interaction with other service
providers will not impair the Adviser's or Distributor's
services at that time.
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you
understand the Fund's financial performance since for the past
five years. Certain information reflects financial results for
a single Fund share. The total returns in the table represent
the rate that an investor would have earned (or lost) on an
investment in the Fund (assuming reinvestment of all dividends
and distributions).
The financial statements for the year ended October 31, 1998
have been audited by Deloitte & Touche LLP, whose unqualified
report thereon is included in the Statement of Additional
Information, which is available upon request. The financial
statements for the years ended October 31, 1997, October 31,
1996 and October 31, 1995 have been audited by Deloitte & Touche
LLP. The financial statements for the year ended October 31,
1994 and have been audited by another independent accountant,
whose reports expressed unqualified opinions on those
statements.
You should read the financial highlights in conjunction with the
financial statements and notes 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.
<PAGE>
<TABLE>
<CAPTION>
Year Ended October 31,
1998 1997 1996 1995 1994
------- ------- ------- ------- ------
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period $13.42 $13.75 $12.70 $13.01 $13.00
------- ------- ------- ------- -------
Investment Activities:
Net investment income .57 .51 .60 .52 .35
Net realized and
unrealized gains (losses) (1.51) .75 1.17 .73 .16
------- ------- ------- ------- -------
Total from Investment
Operations (.94) 1.26 1.77 1.25 .51
------- ------- ------- ------- -------
Distributions:
Net investment income (.59) (.52) (.60) (.51) (.32)
Net realized gains (1.03) (1.07) (.12) (1.05) (.18)
------- ------- ------- ------- -------
Total Distributions (1.62) (1.59) (.72) (1.56) (.50)
------- ------- ------- ------- -------
Net Asset Value:
End of Period $10.86 $13.42 $13.75 $12.70 $13.01
======= ======= ======= ======= =======
Total Return<F1> (7.77%) 9.94% 14.38% 10.88% 4.56%
------- ------- ------- ------- -------
Ratios/Supplemental Data:
Net Assets, End of Period
(in thousands) $22,553 $47,117 $42,871 $46,644 $41,849
------- ------- ------- ------- -------
Ratio of Expenses to
Average Net Assets (1.11%) 1.00% 1.02% 1.01% 1.05%
------- ------- ------- ------- -------
Ratio of Net Investment
Income to Average Net
Assets 4.02% 3.95% 4.52% 4.44% 3.89%
------- ------- ------- ------- -------
Portfolio Turnover Rate 75.47% 45.40% 47.43% 42.07% 53.20%
------- ------- ------- ------- -------
<FN>
<F1> Assumes sales load is not imposed on either initial investment or
reinvestment of distributions.
</FN>
</TABLE>
<PAGE>
CARILLON
CAPITAL
FUND
Carillon
Investment Trust
1876 Waycross Road
Cincinnati, Ohio 45240
PROSPECTUS
Investors who want more information about the Fund can obtain a
Statement of Additional Information ("SAI") that provides more
detailed information on a number of topics and is made a part of
this prospectus. The Fund's annual and semi-annual shareholder
reports also provide more information about the Fund's
investments. The Fund's annual shareholder report also provides
a discussion of the market conditions and investment strategies
that particularly impacted the Fund's performance over the past
fiscal year.
All of these documents are available free of charge upon
request. To obtain copies or to ask other questions about the
Fund, do one of the following:
[Call 1-888-259-7565, or write:
Firstar Mutual Fund Services, LLC
P.O. Box 701
Milwaukee, Wisconsin 53201-0701
Call 1-800-999-1840, or write:
Carillon Investment Trust
P.O. Box 40409
Cincinnati, OH 45240
or, access the SEC's website at http://www.sec.gov.
Investors may, for a fee, get text-only copies of the above
documents from the SEC Public Reference Room by calling
1-800-SEC-0330 or by writing to the SEC Public Reference Room,
Washington, D.C. 20549-6009.
Investment Co. Act File No. 811-5293
<PAGE>
PART B
INFORMATION REQUIRED IN A
STATEMENT OF ADDITIONAL INFORMATION
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
CARILLON CAPITAL FUND
OF
CARILLON INVESTMENT TRUST
Feburary 28, 1999
This Statement of Additional Information ("SAI") is not a
prospectus. This SAI expands upon the Prospectus for Carillon
Capital Fund. Investors should read this SAI in conjunction
with the Prospectus, dated February 28, 1999, and the 1998
shareholder annual report, which is incorporated by reference
into this SAI. To obtain a free copy of the prospectus or the
shareholder report, do one of the following:
Call 1-888-259-7565, or write:
Firstar Mutual Fund Services, LLC
P.O. Box 701
Milwaukee, Wisconsin 53201-0701
Call 1-800-999-1840, or write:
Carillon Investment Trust
P.O. Box 40409
Cincinnati, OH 45240
or access the SEC's website at http://www.sec.gov.
<PAGE>
TABLE OF CONTENTS
Page
INVESTMENT OBJECTIVE, POLICIES AND RISKS ....................3
Fixed Income Securities and Investment Techniques ...........4
Foreign Securities: Investments and Investment Techniques...8
Investment Restrictions ....................................10
MANAGEMENT OF THE TRUST ....................................12
Trustees and Officers ......................................12
Compensation Table .........................................15
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES ........16
INVESTMENT ADVISORY AND OTHER SERVICES .....................17
Investment Adviser .........................................17
Principal Underwriter ......................................20
Brokerage Allocation .......................................20
CAPITAL STOCK AND OTHER SECURITIES .........................22
Shareholder Voting .........................................22
Shareholder Liability ......................................22
Redemptions ................................................22
PURCHASE, REDEMPTION AND PRICING OF SHARES .................23
Initial Purchases of Shares ................................23
Shareholder Accounts .......................................23
Subsequent Purchases of Shares .............................23
Determination of Offering Price ............................24
TAXES ......................................................25
DISTRIBUTION OF SHARES .....................................26
PERFORMANCE ................................................26
ADDITIONAL INFORMATION .....................................27
APPENDIX ................................................ 29
<PAGE>
INVESTMENT OBJECTIVE, POLICIES AND RISKS
Carillon Investment 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").
That registration does not mean that the SEC supervises
investments or investment policy. The Declaration of Trust
permits the Trustees to issue an unlimited number of shares and
to divide shares into an unlimited number of portfolios, all
without shareholder approval.
The Trust operates 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 (the "Fund"), the
Carillon Growth Stock Fund and the Carillon U.S. Government
Securities Fund. On February 22, 1989, The Union Central Life
Insurance Company ("Union Central"), the sole shareholder of the
Carillon Growth Stock Fund and the Carillon U.S. Government
Securities Fund, voted to dissolve these funds. Consequently,
the Trust is now composed only of the Carillon Capital Fund,
whose shares are currently being sold.
The Fund is a diversified, open-end management investment
company, also known as a "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.
The Fund's investment objective is 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 pursues its objective by
investments in stocks, bonds, and money market instruments. The
Fund is a "total return" fund, meaning that the investment
adviser considers both growth and income.
The principal investment strategies of the Fund are listed in
the Fund's prospectus. The Fund's other types of investments
and investment techniques, and discussions of their principal
risks to investors, are listed below. More detailed information
about those investments and investment techniques follows the
list.
FIXED INCOME SECURITIES AND INVESTMENT TECHNIQUES
- Repurchase Agreements
- U.S. Government Obligations
- Government Agency Securities
- Certificates of Deposit
- Time Deposits
- Bankers' Acceptances
- Commercial Paper
- Corporate Debt Securities
- GNMA Certificates
- FNMA and FHLMC Mortgage-Backed Obligations
- Mortgage-Related Securities
INVESTMENTS IN FOREIGN SECURITIES
- American Depositary Receipts
- Foreign Currency Transactions
- Investment Limits by Country
- Foreign Markets
- Foreign Debt Securities
FIXED INCOME SECURITIES AND INVESTMENT TECHNIQUES
The Fund's investment adviser usually invests most of the Fund's
assets in stocks and bonds.
The investment adviser may, however, invest up to 100% of the
Fund's assets in money market securities as a temporary
defensive measure, during unusual or adverse market conditions.
The securities described below are 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 during that 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, such proceedings might delay or prevent
the Fund 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 that the Fund's investment adviser has
determined will present minimal credit risk.
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, the
investment adviser 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 credit rating agencies typically do not rate master demand
notes, if they are 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.
FOREIGN SECURITIES: INVESTMENTS AND INVESTMENT TECHNIQUES
AMERICAN DEPOSITARY RECEIPTS
American Depositary Receipts ("ADRs") are receipts, typically
issued by a U.S. bank or trust company, evidencing ownership of
the underlying foreign securities. ADRs are denominated in
U.S. dollars and trade in the U.S. securities markets. ADRs are
subject to certain of the same risks as direct investment in
foreign securities, including the risk that changes in the value
of the currency in which the security underlying an ADR is
denominated relative to the U.S. dollar may adversely affect the
value of the ADR.
ADRs may be issued in sponsored or unsponsored programs. In
sponsored programs, the issuer makes arrangements to have its
securities traded in the form of ADRs; in unsponsored programs,
the issuer may not be directly involved in the creation of the
program. Although the regulatory requirements with respect to
sponsored and unsponsored programs are generally similar, the
issuers of unsponsored ADRs are not obligated to disclose
material information in the United States and, therefore, such
information may not be reflected in the market value of the
ADRs.
Foreign Currency Transactions
The Fund may engage in foreign currency exchange transactions on
a spot (i.e., cash) basis at the spot rate prevailing in the
foreign exchange currency market, or on a forward basis to "lock
in" the U.S. dollar price of the security. A forward contract
involves an obligation to purchase or sell a specific foreign
currency at a future date, which may be any fixed number of days
from the date of the contract agreed upon by the parties, at a
price set at the time of the contract. These contracts are
traded in the interbank market conducted directly between
currency traders (usually large commercial banks) and their
customers. A forward contract generally has no margin or other
deposit requirement.
By entering into a forward contract, the Fund attempts to
protect itself against possible loss resulting from an adverse
change in the relationship between the U.S. dollar and the
applicable foreign currency during the period between the date
on which the security is purchased or sold and the date on which
related payments are made or received.
The Fund will not enter into forward contracts for longer-term
hedging purposes. The possibility of changes in currency
exchange rates will be incorporated into the long-term
investment considerations when purchasing the investment and
subsequent considerations for possible sale of the investment.
INVESTMENT LIMITS BY COUNTRY The Fund limits not only its total
purchases of foreign securities, but also its purchases for any
single country. For "major countries," the applicable limit is
20% of net assets; for other countries, the applicable limit is
5% of net assets. "Major countries" currently include: The
United Kingdom, Germany, France, Italy, Switzerland,
Netherlands, Spain, Belgium, Canada, Mexico, Argentina, Chile,
Brazil, Australia, Japan, Singapore, New Zealand, Hong Kong,
Sweden and Norway.
FOREIGN MARKETS Delays in settlement which may occur in
connection with transactions involving foreign securities could
result in temporary periods when a portion of the assets of the
Fund is uninvested and no return is earned on it. The Fund's
inability to make intended security purchases due to settlement
problems could cause the Fund to miss attractive investment
opportunities. Inability to dispose of portfolio securities due
to settlement problems could result in losses to the Fund due to
subsequent declines in values of the portfolio securities or, if
the Fund has entered into a contract to sell the security,
possible liability to the purchaser. Certain foreign markets,
especially emerging markets, may require governmental approval
for the repatriation of investment income, capital or the
proceeds of sales of securities by foreign investors. The Fund
could be adversely affected by delays in, or a refusal to grant,
any required governmental approval for repatriation of capital,
as well as by the application to the Fund of any restrictions on
investments.
FOREIGN DEBT SECURITIES Investing in foreign debt securities
will expose the Fund to the direct or indirect consequences of
political, social or economic changes in the industrialized
developing and emerging countries that issue the securities. The
ability and willingness of obligor or the governmental
authorities that control repayment of their external debt to pay
principal and interest on such debt when due may depend on
general economic and political conditions within the relevant
country. Additional country-related factors unique to foreign
issuers which may influence the ability or willingness to
service debt include, but are not limited to, a country's cash
flow situation, the availability of sufficient foreign exchange
on the date a payment is due, the relative size of its debt
service burden to the economy as a whole, and its government's
relationships with the International Monetary Fund, the World
Bank and other international agencies.
If a foreign country cannot generate sufficient earnings from
foreign trade to service its external debt, it may need to
depend on continuing loans and aid from foreign governments,
commercial banks, multilateral organizations, and inflows of
foreign investment. The cost of servicing external debt will
also generally be adversely affected by rising international
interest rates because many external debt obligations bear
interest at rates which are adjusted based upon international
interest rates. The ability to service external debt will also
depend on the level of the relevant government's international
currency reserves and its access to foreign currencies.
Currency devaluations may affect the ability of an obligor to
obtain sufficient foreign currencies to service its external
debt.
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.
(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 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) 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).
(2) 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.
(3) 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.
(4) 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.
Unless otherwise specified, the Fund's investment objectives,
policies and restrictions are not fundamental policies and may
be changed without shareholder approval.
MANAGEMENT OF THE TRUST
TRUSTEES AND OFFICERS
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.
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.
<PAGE>
<TABLE>
<CAPTION>
Name, Address Position(s) with Principal Occupation(s)
and Age the Trust During Past Five Years
- ------------- ---------------- -----------------------
<S> <C> <C>
George M. Callard, M.D.* Trustee Professor of Clinical Surgery,
3021 Erie Avenue University of Cincinnati
Cincinnati, Ohio 45208
(Age 65)
George L. Clucas** Trustee, Senior Vice President, Union
(55) President and Central; Director, President
Chief Executive and Chief Executive Officer,
Officer Carillon Advisers, Inc. ("the
Adviser"); Director, Carillon
Investments, Inc. (the Fund's
principal underwriter)
Theodore H. Emmerich* Trustee Consultant; former Partner,
1201 Edgecliff Pl. Ernst & Whinney, Accountants
Cincinnati, Ohio 45206
(72)
James M. Ewell* Trustee Retired Senior Vice President and
9000 Indian Ridge Road Director, The Procter and Gamble
Cincinnati, Ohio 45243 Company
(83)
Richard H. Finan* Trustee Attorney at Law; President of the
11137 Main Street Ohio State Senate
Cincinnati, Ohio 45241
(64)
Jean Patrice Harrington, Trustee Former Interim President,
S.C.* Cincinnati State Technical and
3217 Whitfield Ave. Community College; Former Executive
Cincinnati, Ohio 45220 Director, Cincinnati Youth
(76) Collaborative; President Emeritus
(formerly, President), College of
Mount St. Joseph
John H. Jacobs** Trustee President and Chief Operating
(52) Officer, Union Central; Director,
the Adviser; Director, Carillon
Investments, Inc.; prior to July
1998, Officer and employee, Union
Central
Charles W. McMahon* Trustee Retired Senior Vice President and
Cincinnati, Ohio 45239 Director, Union Central
2031 W. Galbraith Rd., #E
(79)
Harry Rossi** Trustee Director Emeritus, Union Central;
8548 Wyoming Club Drive Director, the Adviser; Director,
Cincinnati, Ohio 45215 Carillon Investments, Inc.; former
(79) Chairman, President and Chief
Executive Officer, Union Central
Stephen R. Hatcher Senior Vice Executive Vice President and Chief
(56) President Financial Officer, Union Central;
prior to June, 1995, Officer and
employee, Union lCentral
John F. Labmeier Vice President Vice President, Associate
(50) and Secretary General Counsel and Assistant
Secretary, Union Central; Vice
President and Secretary, Carillon
Investments, Inc.; Secretary, the
Adviser
Thomas G. Knipper Controller Treasurer, the Adviser; prior to
(41) and Treasurer July, 1995, Treasurer of The
Gateway Trust and Vice President
and Controller of Gateway Advisers,
Inc.
John M. Lucas Assistant Counsel and Assistant to the
(48) Secretary Secretary, Union Central
</TABLE>
- ----------------
*Trustees identified with an asterisk are members of the Audit
Committee. The Audit Committee reviews the scope and results of
the Fund's annual audits with the Fund's independent accountant.
**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 1.5% 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 $300
plus actual out-of-pocket expense by the Trust for each meeting
of the Board of Trustees attended, $200 for each meeting of the
Board of Trustees held by telephone conference, and $550 per
calendar quarter ($2,200 annually). Trustees who are members of
the Audit Committee are compensated at the rate of $200 per
Audit Committee meeting. The total of such fees incurred by the
Trust for the year ended October 31, 1998 was $23,420. The Fund
does not provide any pension or retirement benefits for its
officers or trustees.
Compensation Table
<TABLE>
<CAPTION>
Total
Aggregate Compensation From
Name of Person, Compensation Fund and Fund Complex*
Position From Fund<F1> Paid to Trustees
<S> <C> <C>
George M. Callard, M.D. 3,500 13,325
Trustee
George L. Clucas N/A N/A
Trustee
Theodore H. Emmerich 3,600 13,525
Trustee
James M. Ewell 3,700 13,725
Trustee
Richard H. Finan 3,700 13,725
Trustee
Jean Patrice
Harrington, S.C. 3,800 13,925
Trustee
John H. Jacobs N/A N/A
Trustee
Charles W. McMahon 3,500 13,325
Trustee
Harry Rossi N/A N/A
Trustee
<FN>
<F1> No compensation was deferred for any Trustee or Officer under a deferred
compensation plan.
</FN>
</TABLE>
*Each of the Trustees also serves as a director of Carillon
Fund, Inc.
Purchases of the Fund shares by Carillon Investments, Inc.
(which is the Fund's principal underwriter), its directors,
officers and employees, or those of its 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 such
directors, officers and employees also will not be subject to
the sales charge.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
Union Central, an insurance company organized under the laws of
Ohio, provided the initial capital for the Fund by purchasing
one million shares. Union Central is free to redeem its
investment at any time, subject to retaining at least $100,000
in the Fund. The principal business address of Union Central is
1876 Waycross Road, Cincinnati, Ohio 45240 (P.O. Box 40888,
Cincinnati, Ohio 45240).
In addition to Union Central's own investment, shares of the
Fund are sold to the trustees of certain Union Central employee
benefit plans to fund benefits for Union Central's employees.
As of January 31, 1999, Union Central and Union Central's plan
trustees owned 65% and 27%, respectively, of Fund shares, and,
consequently, Union Central 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).
As of December 31, 1998, Dudley S. Taft, 8000 Spooky Hollow Rd.,
Cincinnati, OH 45242, beneficially owned 5.7% of the outstanding
shares of the Fund.
INVESTMENT ADVISORY AND OTHER SERVICES
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.
(the "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 Union Central, a mutual insurance company
organized in 1867 under the laws of Ohio. The following
officers of the Trust also are directors of and serve as the
following executive officers of the Adviser: 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 16, 1998. 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 Fund 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
decides whether 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, the 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. For the year ended October 31,
1998, expenses ($390,864) as a percentage of average net assets
($35,100,567) equaled 1.11%.
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 the Adviser for the fiscal
years ended October 31, 1998, October 31, 1997 and October 31,
1996 amounted to $263,254, $337,641 and $311,413, respectively.
ADMINISTRATION
The Adviser is responsible for providing certain administrative
functions to the Trust and has entered into an Administration
Agreement with the Fund's principal underwriter, Carillon
Investments, under which Carillon Investments furnishes
substantially all of such services for an annual fee of .20% of
the Trust's average net assets. The Adviser pays the fee, not
the Trust. Under the Administration Agreement, Carillon
Investments 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.
SERVICE AGREEMENT
Under a Service Agreement between the Adviser and Union Central,
Union Central has agreed to make available to the Adviser the
services of certain employees of Union Central 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 Union Central
for all the costs allocable to the time spent on the affairs of
the Adviser by the employees provided by Union Central. In per-
forming 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. Union Central 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 Union Central
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.
OTHER CLIENTS OF THE ADVISER
The Agreement in no way restricts the Adviser from acting as
investment manager or adviser to others. The Adviser may
recommend securities purchases to both the Trust and to other
clients, including registered investment companies, for which it
acts as an adviser. Because of different investment objectives
or other factors, one or more of the Adviser's clients may buy a
particular security 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, the Adviser will transact such
securities 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.
PRINCIPAL UNDERWRITER
Carillon Investments, Inc., 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.
Carillon Investments is a wholly-owned subsidiary of Union
Central. Pursuant to a Distribution Agreement with the Trust,
Carillon Investments 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.
Carillon Investments also pays for the printing and distribution
of prospectuses, sales literature and advertising costs in
connection with the offering of Fund shares.
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, 1998, October 31, 1997 and
October 31, 1996, the Fund paid $44,249, $38,940 and $30,346,
respectively, in brokerage commissions. Of the brokerage
commissions paid during the year ended October 31, 1998, 34% was
paid to brokers furnishing statistical data or research
information. No commissions were paid to affiliates of the
Trust.
As of October 31, 1998, the Fund owned shares of common stock of
Jefferies Group, Incorporated, a broker with whom the Fund
regularly does business. The value of the Fund's aggregate
holdings of Jefferies Group, Incorporated as of that date was
$330,000.
<PAGE>
CAPITAL STOCK AND OTHER SECURITIES
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.
Union Central initially invested $10 million in the Fund. Union
Central is free to redeem its investment at any time subject to
retaining at least $100,000 in the Fund.
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.
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.
PURCHASE, REDEMPTION AND PRICING OF SHARES
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 the transfer agent receives an order to
purchase, plus a sales charge.
INITIAL PURCHASES OF SHARES
If you haven't bought Fund shares before, you need to fill out
and submit an application and a purchase order to: Carillon
Investments, Inc. P.O. Box 40409, Cincinnati, Ohio 45240. You
can also submit an application and purchase order to a broker-
dealer which has a selling agreement with Carillon Investments
(a "Participating Broker"). You can get application forms with
this prospectus, or from a Participating Broker, or from
Carillon Investments. If you've bought Fund shares, you can
make subsequent purchases through a Participating Broker,
Carillon Investments, by mail or through an automatic deduction
from your checking account.
The Participating Brokers and Carillon Investments are
responsible for the prompt forwarding of orders to the transfer
agent. If the transfer agent receives the purchase order 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.
Your 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.
The Fund will assess a $15 service charge for all returned
checks due to insufficient funds or closed accounts.
SHAREHOLDER ACCOUNTS
We will automatically establish an account for you when you
initially purchase shares. If you buy or receive any more
shares, we will credit them directly to your account. We will
not issue share certificates.
SUBSEQUENT PURCHASES OF SHARES
You need to make certain elections on the application form for
the purchase of Fund shares if you want to make subsequent
purchases by bank wire ($500 minimum), by check, or by automatic
monthly deductions ($100 minimum) from your checking account.
Checks that are made payable to someone other than the
registered account owner and endorsed over to the Fund (i.e.,
third party checks) will not be accepted. If you make the
appropriate election, your bank can wire money to the transfer
agent to purchase Fund shares. Your bank must be a member of
the Federal Reserve System. Your bank will likely impose a fee
for this service. Of course, you may send subsequent payments
directly to the transfer agent: Firstar, Mutual Fund Services,
LLC, P.O. Box 701, Milwaukee, Wisconsin 53201-0701. Whenever
you place an order, you must give your account number.
DETERMINATION OF OFFERING PRICE
As of October 31, 1998, the offering price per share was
calculated as follows: the net asset value per share of $10.86,
plus the maximum sales charge of 5%, equals the offering price
per share of $11.43. Selling broker-dealers receive a
reallowance of a portion of the sales load from Carillon
Investments.
CALCULATION OF NET ASSET VALUE
The net asset value of the Fund's shares is determined once each
day, 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); and (ii) 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.
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; and (b) 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), or of two or
more issuers which the Fund controls and which are in the same
or similar trades or businesses or related trades or businesses.
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 comply with the
diversification and other requirements of Subchapter M of the
Code, the Fund may not be able to buy or sell certain securities
at certain times, so the investments utilized (and the time at
which such investments are purchased and sold) may be different
from what the Fund might otherwise believe to be desirable.
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.
DISTRIBUTION OF SHARES
Carillon Investments, Inc., 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, Carillon
Investments 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, Carillon Investments conducts its
affairs in accordance with the Conduct Rules of the National
Association of Securities Dealers, Inc. ("NASD").
Carillon Investments sells Fund shares primarily through its own
registered representatives. Carillon Investments may, however,
authorize the sale of shares by firms that are registered
broker-dealers and are members of the NASD.
Carillon Investments 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. Carillon Investments received $[____], $582
and $241, respectively, in aggregate commissions from the sale
of Trust shares for the years ended October 31, 1998, October
31, 1997 and October 31, 1996. Of these amounts, Carillon
Investments retained $[____], $116 and $48 for the respective
periods.
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. 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.
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, where: P =
a hypothetical initial payment of $1000; T = average annual
total return; n = number of years; and ERV = ending
redeemable value of a hypothetical $1000 payment made at the
beginning of the 1, 5 or 10 year periods at the end of the 1,
5 or 10 year periods (or fractional portion thereof).
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, 1998
The average total returns for the Fund from inception to date
periods ended October 31, 1998 are as follows.
<TABLE>
<CAPTION>
Average Annual Total Return*
Period Ended October 31, 1998
Inception Since
Date 1 Year 5 Years Inception
---------------------------------------
<S> <C> <C> <C> <C>
Carillon Capital Fund 2/28/88 -12.4% 5.1% 8.7%
</TABLE>
*Based upon the maximum sales charge of 5%, and assuming
reinvestment of all dividends and distributions
ADDITIONAL INFORMATION
Firstar Mutual Fund Services, LLC, 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.
The financial statements of the Fund have been audited by
Deloitte & Touche LLP, 1700 Courthouse Plaza NE, Dayton, Ohio
45402, independent auditors. The financial statements are
incorporated by reference into this Statement of Additional
Information in reliance upon the report of Deloitte & Touche
LLP, given upon their authority as experts in auditing and
accounting.
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.
<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.
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>
FINANCIAL STATEMENTS TO BE FILED BY AMENDMENT
<PAGE>
PART C
OTHER INFORMATION
<PAGE>
CARILLON CAPITAL FUND
OF
CARILLON INVESTMENT TRUST
PART C - OTHER INFORMATION
Item 23. Exhibits
All references are to Registrant's Registration Statement on
Form N-1A (File No. 33-1665), unless otherwise stated.
(a) (1) Declaration of Trust and Amendment No. 1- incorporated
by reference (initial filing on August 21, 1987)
(2) Amendment No. 2 - incorporated by reference
(Pre-Effective Amendment No. 1 - December 30, 1987)
(3) Amendment No. 3 - incorporated by reference
(Post-Effective Amendment No. 3 - February 28, 1990)
(b) By-Laws - incorporated by reference (initial filing on
August 21,1987)
(c) Not Applicable
(d) (1) Investment Advisory Agreement - incorporated by
reference (Pre-Effective Amendment No. 1- December 30,
1987)
(2) Administration Agreement - incorporated by reference
(initial filing on August 21, 1987)
(3) Amendment to Administration Agreement - incorporated
by reference (Post-Effective Amendment No. 3 -
February 28, 1990)
(e) (1) Distribution Agreement - incorporated by reference
(Pre-Effective Amendment No. 1- December 30, 1987)
(2) Amendment to Distribution Agreement - incorporated by
reference (Post-Effective Amendment No. 2 - February
28, 1989)
(f) Not Applicable
(g) (1) Custodian Agreement - incorporated by reference
(Post-Effective Amendment No. 3 - February 28, 1990)
(2) Portfolio Accounting Agreement - incorporated by
reference (Post-Effective Amendment No. 3 - February
28, 1990)
(h) Transfer Agency Agreement - incorporated by reference
(Post-Effective Amendment No. 3 - February 28, 1990)
(i) Opinion and Consent of Counsel - incorporated by reference
(Pre-Effective Amendment No. 2 - February 12, 1988)
(j) Consent of Deloitte & Touche LLP - to be filed by amendment
(k) Not Applicable
(l) Form of Contribution Agreement - incorporated by reference
(Pre-Effective Amendment No. 1 - December 30, 1987)
(m) Not Applicable
(n) Financial Data Schedule -- to be filed by amendment
(o) Not Applicable
Item 24. Persons Controlled by or Under Common Control with
Registrant
At December 1, 1998, approximately [___%] 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.
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) -100%
owned
E. Family Enterprise Institute, Inc. (Delaware) -100% owned
F. PRBA, Inc. (California) - 100% owned
a. Price, Raffel & Browne Administrators, Inc. (Delaware) -
100% owned
G. B&B Benefits Administration, Inc. (California) - 100%
owned
H. Summit Investment Partners, LLC (Ohio) - 100% owned
II. Mutual Funds of the Carillon Group
A. Carillon Fund, Inc.* (Maryland)
B. Carillon Investment Trust** (Massachusetts)
* At December 1, 1998, The Union Central Life Insurance Company
owned 100% of the outstanding shares of Carillon Fund, Inc.
** At December 1, 1998, The Union Central Life Insurance
Company owned 92% of the outstanding shares of the Trust.
III. Summit Investment Trust (Massachusetts) - a mutual fund
whose investment adviser is First Summit Capital Management
Item 25. Indemnification
See Exhibits (a) and (b).
Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred
or paid by a director, officer or controling person of the
registrant in the successful defense of any action, suit or
proceeding) is aserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
Item 26. 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>
Position with Principal Occupation(s)
Name and Address the Adviser During Past Two Years
<S> <C> <C>
Harri Rossi Director Director Emeritus, The Union Central
Life Insurance Company ("UC");
Director, Carillon Group of Mutual
Funds; prior thereto, Director, UC
John H. Jacobs Director President and Chief Operating Officer,
UC; Director, Carillon Group of Mutual
Funds; prior thereto, Executive Vice
President, UC
George L. Clucas Director, Senior Vice President, UC;
President and Director, President and Chief
Chief Executive Officer, Carillon
Executive Group of Mutual Funds
Officer
D. Stephen Cole Vice President Vice President, UC
Thomas G. Knipper Treasurer Treasurer, the Adviser;
Controller and Treasurer, Carillon
Group of Mutual Funds
John F. Labmeier Secretary President, Associate General
Counsel and Assistant Secretary, UC;
Vice President and Secretary,
Carillon Group of Mutual Funds and
Carillon Investments, Inc.
</TABLE>
Item 27. Principal Underwriters
(a) The principal underwriter of Registrant is Carillon
Investments, Inc. Carillon Investments, Inc. also acts as
principal underwriter for the Carillon Account and Carillon Life
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 Trustee, President and
Director Chief Executive Officer
Charles W. Grover None
Director
John H. Jacobs Trustee
Director
Elizabeth G. Monsell None
Director and President
Harry Rossi Trustee
Director
Lothar A. Vasholz None
Director
Kevin W. O'Toole None
Vice President
Connie Grosser 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 [$______] in
aggregate commissions from the sale of Trust shares for the year
ended October 31, 1998. Of this amount, Carillon Investments,
Inc. retained [$_____].
Item 28. Location of Accounts and Records
Firstar Mutual Fund Services, LLC, 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 29. Management Services
Not Applicable
Item 30. Undertakings
Not Applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933
and the Investment Company Act of 1940, the Registrant, Carillon
Investment Trust, 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 12 day of January, 1999.
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 1/12/99
George L. Clucas and Trustee
(Principal
Executive
Officer)
/s/ Thomas G. Knipper Controller 1/12/99
Thomas G. Knipper and Treasurer
(Principal
Financial
and Accounting
Officer)
*/s/ George M. Callard, M.D. Trustee 1/12/99
George M. Callard, M.D.
*/s/ Theodore H. Emmerich Trustee 1/12/99
Theodore H. Emmerich
*/s/ James M. Ewell Trustee 1/12/99
James M. Ewell
*/s/ Richard H. Finan Trustee 1/12/99
Richard H. Finan
*/s/ Jean Patrice Harrington, S.C. Trustee 1/12/99
Jean Patrice Harrington, S.C.
*/s/ John H. Jacobs Trustee 1/12/99
John H. Jacobs
*/s/ Charles W. McMahon Trustee 1/12/99
Charles W. McMahon
*/s/ Harry Rossi Trustee 1/12/99
Harry Rossi
</TABLE>
*/ By /s/ John F. Labmeier pursuant to Power of Attorney
previously filed.
<PAGE>
TABLE OF EXHIBITS
(j) Consent of Deloitte & Touche LLP*
(n) Financial Data Schedule*
____________________________
* To be filed by Amendment
