Registration No. 33-25301
811-5685
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X /
Pre-Effective Amendment No.
Post-Effective Amendment No. 28
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / X /
Amendment No. 31
WILLIAMSBURG INVESTMENT TRUST
(Exact Name of Registrant as Specified in Charter)
312 Walnut Street, 21st Floor, Cincinnati, Ohio 45202
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code: (513)629-2000
W. Lee H. Dunham, Esq.
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
/ / immediately upon filing pursuant to Rule 485(b)
/ / on ( ) pursuant to Rule 485(b)
/ X/ 60 days after filing pursuant to Rule 485(a)
/ / on ( ) pursuant to Rule 485(a)
The Registrant has registered an indefinite number of shares under the
Securities Act of 1933, as amended, pursuant to Rule 24f-2 under the Investment
Company Act of 1940, as amended. The Rule 24f-2 Notice for the fiscal year ended
March 31, 1997 was filed on May 30, 1997.
<PAGE>
WILLIAMSBURG INVESTMENT TRUST
CROSS-REFERENCE SHEET PURSUANT TO RULE 495(A)
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Part A Prospectus
Form Item Cross-Reference
Item 1. Cover Page Cover Page
Item 2. Synopsis Prospectus Summary;
Synopsis of Costs and
Expenses
Item 3. Condensed Financial Financial Highlights;
Information Dividends, Distributions,
Taxes and Other
Information
Item 4. General Description Investment Objective,
of Registrant Investment Policies and
Risk Considerations;
Management of the Fund
Item 5. Management of the Fund Management of the Fund
Item 5A. Management's Discussion Not Applicable
of Fund Performance
Item 6. Capital Stock and Tax Status; Dividends,
Distributions, Taxes and Other
Other Securities Information
Item 7. Purchase of Securities How to Purchase Shares;
Being Offered How Net Asset Value is
Determined; Application
Item 8. Redemption or Repurchase How to Redeem Shares
Item 9. Pending Legal Proceedings Not Applicable
<CAPTION>
Statement of
Part B Additional Information
Form Item Cross-Reference
<S> <C> <C>
Item 10. Cover Page Cover Page
Item 11. Table of Contents Cover Page
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<CAPTION>
<S> <C> <C>
Item 12. General Information Capital Shares and Voting
and History
Item 13. Investment Objectives Investment Objective and
and Policies Policies; Description of
Bond Ratings; Investment
Limitations
Item 14. Management of the Fund Trustees and Officers
Item 15. Control Persons and Trustees and Officers
Principal Holders of
Securities
Item 16. Investment Advisory and Investment Advisor;
Other Services Administrator;
Other Services
Item 17. Brokerage Allocation Brokerage
Item 18. Capital Stock and Capital Shares and Voting
Other Securities
Item 19. Purchase, Redemption and Special Shareholder
Pricing of Securities Services; Purchase of
Being Offered Shares; Redemption of
Shares; Net Asset Value
Determination
Item 20. Tax Status Additional Tax
Information
Item 21. Underwriters Not Applicable
Item 22. Calculation of Calculation of
Performance Data Performance Data
Item 23. Financial Statements Financial Statements and
Reports
</TABLE>
<PAGE>
PROSPECTUS
July 31, 1997
THE JAMESTOWN
BOND FUNDS
INSTITUTIONAL SHARES
No-Load Funds
The investment objective of THE JAMESTOWN BOND FUND (the "Bond Fund") is to
maximize total return, consisting of current income and capital appreciation
(both realized and unrealized), consistent with the preservation of capital
through active management of investment grade fixed income securities.
The investment objective of THE JAMESTOWN SHORT TERM BOND FUND (the "Short Term
Fund") is identical to that of the Bond Fund, with the distinction that the
Short Term Fund intends to achieve this objective by investing in a portfolio of
investment grade fixed income securities having a shorter average duration.
The Jamestown Bond Fund and The Jamestown Short Term Bond Fund are designed
primarily for institutional investors who wish to take advantage of the
professional investment management expertise of Lowe, Brockenbrough & Tattersall
Strategic Advisors, Inc., which serves as investment advisor to the Funds.
The Funds offer two classes of shares: Consultant Shares, sold subject to a
12b-1 fee up to .15% of average daily net assets, and Institutional Shares, sold
without a 12b-1 fee. Each Consultant and Institutional Share of the Fund
represents identical interests in the Fund's investment portfolio and has the
same rights, except that (i) Consultant Shares bear the expenses of distribution
fees, which will cause Consultant Shares to have a higher expense ratio and to
pay lower dividends than Institutional Shares; (ii) certain class specific
expenses will be borne solely by the class to which such expenses are
attributable; and (iii) each class has exclusive voting rights with respect to
matters affecting only that class.
INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall Strategic Advisors, Inc.
Richmond, Virginia
The Jamestown and the Jamestown Short Term Bond Fund (the "Funds") are
NO-LOAD, diversified, open-end series of the Williamsburg Investment Trust, a
registered management investment company. This Prospectus provides you with the
basic information you should know before investing in the Funds. You should read
it and keep it for future reference. While there is no assurance that the Funds
will achieve their investment objectives, they endeavor to do so by following
the investment policies described in this Prospectus. Consultant Shares are
offered in a separate prospectus and additional information about Consultant
Shares may be obtained by calling 1-800-443-4249.
<PAGE>
A Statement of Additional Information, dated July 31, 1997 containing additional
information about the Funds, has been filed with the Securities and Exchange
Commission and is incorporated by reference in this Prospectus in its entirety.
The Funds' address is P.O. Box 5354, Cincinnati, Ohio 45201-5354, and their
telephone number is 1-800-443-4249. A copy of the Statement of Additional
Information may be obtained at no charge by calling or writing the Funds.
TABLE OF CONTENTS
PROSPECTUS SUMMARY......................................................
SYNOPSIS OF COSTS AND EXPENSES..........................................
FINANCIAL HIGHLIGHTS....................................................
INVESTMENT OBJECTIVES, INVESTMENT POLICIES
AND RISK CONSIDERATIONS. .............................................
HOW TO PURCHASE SHARES..................................................
HOW TO REDEEM SHARES....................................................
HOW NET ASSET VALUE IS DETERMINED.......................................
MANAGEMENT OF THE FUNDS.................................................
DIVIDENDS, DISTRIBUTIONS, TAXES AND OTHER INFORMATION...................
APPLICATION.............................................................
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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<PAGE>
PROSPECTUS SUMMARY
THE FUNDS. The Jamestown Bond Fund (the "Bond Fund") and the Jamestown Short
Term Bond Fund (the "Short Term Fund") are NO- LOAD, diversified, open-end
series of the Williamsburg Investment Trust, a registered management investment
company commonly known as a "mutual fund." Each represents a separate mutual
fund with its own objectives and policies. An investor may elect one or both of
the Funds to meet individual investment objectives, and may switch from one Fund
to the other without charge when a shareholder's investment objectives or plans
change. While there is no assurance that the Funds will achieve their investment
objectives, they each endeavor to do so by following the investment policies
described in this Prospectus. The Funds are primarily designed for tax exempt
institutional investors such as pension and profit-sharing plans, endowments,
foundations, and employee benefit trusts. Corporations and individual investors
may invest in either Fund, although it should be noted that investment decisions
of the Funds will not be influenced by any federal tax considerations, other
than those considerations which apply to the Funds themselves.
INVESTMENT OBJECTIVES. The Bond Fund and the Short Term Fund are governed by
virtually identical investment objectives and policies, WITH THE EXCEPTION of
the average duration range of the individual Funds. Each Fund seeks to maximize
total return, consisting of current income and capital appreciation (both
realized and unrealized), consistent with the preservation of capital through
active management of investment grade fixed income securities. For a more
detailed explanation of the definition of "investment grade" securities, see
"Investment Objectives, Investment Policies and Risk Considerations."
INVESTMENT APPROACH. The Advisor's philosophy in managing fixed income
portfolios is to emphasize a disciplined balance between sector selection and
moderate portfolio duration shifts to maximize total return. Duration is an
important concept in the Advisor's fixed income management philosophy and, in
the Advisor's opinion, provides a better measure of interest rate sensitivity
than maturity for many fixed income securities. Each Fund intends to invest only
in investment grade securities. Due to their controlled duration and quality
standards, the Funds expect to exhibit less volatility than would mutual funds
with longer average maturities and lower quality portfolios.
INVESTMENT ADVISOR. Lowe, Brockenbrough & Tattersall Strategic Advisors,
Inc. (the "Advisor") serves as investment advisor to each of the Funds. For its
services, the Advisor receives compensation of 0.375% of the average daily net
assets of each Fund. (See "Management of the Funds.")
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<PAGE>
PURCHASE OF SHARES. Institutional Shares are offered "No-Load," which means they
may be purchased directly from the Funds without the imposition of any sales or
12b-1 charges.
The minimum initial purchase for the Bond Fund is $500,000. The minimum
initial purchase for the Short Term Fund is $100,000.
Subsequent investments in both Funds must be $1,000 or more.
Shares may be purchased by individuals or organizations and may
be appropriate for use in Tax Sheltered Retirement Plans. (See
"How to Purchase Shares.")
REDEMPTION OF SHARES. There is currently no charge for
redemptions from either Fund. Shares may be redeemed at any time
in which the Funds are open for business at the net asset value
next determined after receipt of a redemption request by the
Funds. (See "How to Redeem Shares.")
DIVIDENDS AND DISTRIBUTIONS. Net investment income of the Funds
is distributed quarterly. Net capital gains, if any, are
distributed annually. Shareholders may elect to receive
dividends and capital gain distributions in cash or the dividends
and capital gain distributions may be reinvested in additional
Fund shares. (See "Dividends, Distributions, Taxes and Other
Information.")
MANAGEMENT. The Funds are series of the Williamsburg Investment
Trust (the "Trust"), the Board of Trustees of which is
responsible for overall management of the Trust and the Funds.
The Trust has employed Countrywide Fund Services, Inc. (the
"Administrator") to provide administration, accounting and
transfer agent services. (See "Management of the Funds.")
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<PAGE>
SYNOPSIS OF COSTS AND EXPENSES
THE JAMESTOWN BOND FUND
INSTITUTIONAL SHARES
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Exchange Fee None
Redemption Fee None*
Check Redemption Processing Fee (per check)
First six checks per month None
Additional checks per month $0.25
* A wire transfer fee is charged by the Fund's Custodian in the case of
redemptions made by wire. Such fee is subject to change and is
currently $8. See "How to Redeem Shares."
ANNUAL FUND OPERATING EXPENSES:
(As a percentage of net assets)
Investment Advisory Fee 0.375%
Administrator's Fees 0.075%
Other Expenses 0.080%
------
Total Fund Operating Expense 0.53%
======
EXAMPLE: You would pay the following expenses on a $1,000 investment,
whether or not you redeem at the end of the period, assuming
5% annual return:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
$ 5 $17 $30 $66
THE JAMESTOWN SHORT TERM BOND FUND
INSTITUTIONAL SHARES
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Exchange Fee None
Redemption Fee None*
Check Redemption Processing Fee (per check)
First six checks per month None
Additional checks per month $0.25
* A wire transfer fee is charged by the Fund's Custodian in the case of
redemptions made by wire. Such fee is subject to change and is
currently $8. See "How to Redeem Shares."
ANNUAL FUND OPERATING EXPENSES:
(As a percentage of net assets)
Investment Advisory Fees (after fee waivers) 0.00%
Administrator's Fees 0.25%
Other Expenses (after expense reimbursements) 0.25%
-----
Total Fund Operating Expense 0.50%
=====
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<PAGE>
EXAMPLE: You would pay the following expenses on a $1,000 investment,
whether or not you redeem at the end of the period, assuming
5% annual return:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ --------- --------- --------
$ 5 $16 $28 $63
The purpose of the foregoing tables is to assist investors in the Funds in
understanding the various costs and expenses that they will bear directly or
indirectly. See "Management of the Funds" for more information about the fees
and costs of operating the Funds. The Annual Fund Operating Expenses shown above
are based upon actual operating history for the fiscal year ended March 31,
1997. Absent the fee waivers and expense reimbursements by the Advisor, the
Short Term Fund's investment advisory fees would have been 0.375% of average
daily net assets, other expenses would have been 0.32% of average net assets and
total fund operating expenses would have been 0.94% of average daily net assets.
THE EXAMPLES SHOWN SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES IN THE FUTURE MAY BE GREATER OR LESS THAN THOSE SHOWN.
The footnotes to the Financial Highlights table contain information concerning a
decrease in the Bond Fund's expense ratio as a result of a directed brokerage
arrangement.
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<PAGE>
FINANCIAL HIGHLIGHTS
The following audited financial information with respect to Institutional Shares
of the Fund has been audited by Tait, Weller & Baker, independent accountants,
whose report covering the fiscal year ended March 31, 1997 is contained in the
Statement of Additional Information. This information should be read in
conjunction with the Funds' latest audited annual financial statements and notes
thereto, which are also contained in the Statement of Additional Information, a
copy of which may be obtained at no charge by calling the Funds.
THE JAMESTOWN BOND FUND
<TABLE>
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each
Period
<CAPTION>
Years Ended March 31,
--------------------------------------------------------
1997 1996 1995 1994 1993
-------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $10.39 $9.97 $10.15 $10.82 $10.42
-------- ------- -------- -------- --------
Income from investment operations:
Net investment income 0.68 0.70 0.62 0.55 0.64
Net realized and unrealized gains (losses) on investments (0.12) 0.41 (0.18) (0.30) 0.55
-------- ------- -------- -------- --------
Total from investment operations 0.56 1.11 0.44 0.25 1.19
-------- ------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.69) (0.69) (0.62) (0.55) (0.64)
Distributions from net realized gains -- -- -- (0.19) (0.15)
Distributions in excess of net realized gains -- -- -- (0.18) --
-------- ------- -------- -------- --------
Total distributions (0.69) (0.69) (0.62) (0.92) (0.79)
-------- ------- -------- -------- --------
Net asset value at end of period $10.26 $10.39 $9.97 $10.15 $10.82
======== ======= ======== ======== ========
Total return 5.52% 11.23% 4.56% 2.12% 11.69%
======== ======= ======== ======== ========
Net assets at end of period (000's) $76,499 $74,774 $72,029 $64,029 $55,718
======== ======= ======== ======== ========
Ratio of expenses to average net assets (b) 0.53% 0.56% 0.53% 0.60% 0.59%
Ratio of net investment income to average net assets 6.48% 6.54% 6.28% 5.03% 6.09%
Portfolio turnover rate 207% 268% 381% 381% 454%
<PAGE>
<CAPTION>
Year Period
Ended Ended
March 31, March 31,
1992 1991 (a)
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Net asset value at beginning of period $ 9.97 $10.00
-------- -------
Income from investment operations:
Net investment income 0.54 0.20
Net realized and unrealized gains (losses) on investments 0.48 (0.03)
-------- -------
Total from investment operations 1.02 0.17
-------- -------
Less distributions:
Dividends from net investment income (0.54) (0.20)
Distributions from net realized gains (0.03) --
Distributions in excess of net realized gains -- --
-------- -------
Total distributions (0.57) (0.20)
-------- -------
Net asset value at end of period $10.42 $ 9.97
======== =======
Total return 10.33% 5.70%(c)
======== =======
Net assets at end of period (000's) $29,727 $ 794
======== =======
Ratio of expenses to average net assets (b) 0.60% 0.90%(c)
Ratio of net investment income to average net assets 6.67% 7.07%(c)
Portfolio turnover rate 484% 54%
<FN>
(a) Represents the period from the commencement of operations
(December 31, 1990) through March 31, 1991.
(b) For the years ended March 31, 1997 and 1996, the ratio of expenses to
average net assets was determined based on gross expenses prior to
expense reimbursements through a directed brokerage arrangement. For
periods prior to March 31, 1996, the ratio was determined based on net
expenses after expense reimbursements through the directed brokerage
arrangement. Absent such expense reimbursements, the ratio of expenses to
average net assets would have been 0.57% for the year ended March 31,
1995. Absent investment advisory fees waived by the Advisor, the ratio
of expenses to average net assets would have been 0.80% and 3.08%(c)
for the periods ended March 31, 1992 and 1991.
(c) Annualized.
</FN>
</TABLE>
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<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Years Ended March 31,
--------------------------------------------------------------
1997 1996 1995 1994 1993
------ ----- ----- ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $9.72 $9.64 $9.82 $10.07 $9.93
------ ------ ----- ------ ------
Income from investment operations:
Net investment income 0.58 0.62 0.60 0.51 0.50
Net realized and unrealized gains (losses)
on investments (0.11) 0.08 (0.17) (0.23) 0.13
------ ------ ----- ------ ------
Total from investment operations 0.47 0.70 0.43 0.28 0.63
------ ------ ----- ------ ------
Less distributions:
Dividends from net investment income (0.58) (0.62) (0.61) (0.51) (0.49)
Distributions from net realized gains -- -- -- (0.02) --
------ ------ ----- ------ ------
Total distributions (0.58) (0.62) (0.61) (0.53) (0.49)
------ ------ ----- ------ ------
Net asset value at end of period $9.61 $9.72 $9.64 $9.82 $10.07
====== ====== ===== ====== ======
Total return 5.01% 7.38% 4.53% 2.76% 6.40%
====== ====== ===== ====== ======
Net assets at end of period (000's) $9,924 $9,426 $14,122 $18,715 $15,580
====== ====== ===== ====== ======
Ratio of expenses to average net assets (b) 0.50% 0.50% 0.50% 0.50% 0.50%
Ratio of net investment income to average net assets 5.96% 6.27% 6.04% 5.22% 5.24%
Portfolio turnover rate 62% 157% 144% 324% 289%
<PAGE>
<CAPTION>
Period
Ended
March 31,
1992(a)
------
<S> <C>
Net asset value at beginning of period $10.00
------
Income from investment operations:
Net investment income 0.09
Net realized and unrealized gains (losses)
on investments (0.07)
------
Total from investment operations 0.02
------
Less distributions:
Dividends from net investment income (0.09)
Distributions from net realized gains --
------
Total distributions (0.09)
------
Net asset value at end of period $9.93
======
Total return 0.99%(c)
======
Net assets at end of period (000's) $5,320
======
Ratio of expenses to average net assets (b) 0.50%(c)
Ratio of net investment income to average net assets 4.86%(c)
Portfolio turnover rate 97%
<FN>
(a) Represents the period from the commencement of operations (January 21,
1992) through March 31, 1992.
(b) Absent investment advisory fees waived and expenses reimbursed by the
Adviser, the ratios of expenses to average net assets would have been
0.94%, 0.85%, 0.85%, 0.81%, 0.82% and 0.81%(c) for the periods ended
March 31, 1997, 1996, 1995, 1994, 1993 and 1992, respectively.
(c) Annualized.
</FN>
</TABLE>
Further information about the performance of the Funds is contained in the
Annual Report, a copy of which may be obtained at no charge by calling the
Funds.
<PAGE>
INVESTMENT OBJECTIVES, INVESTMENT POLICIES
AND RISK CONSIDERATIONS
The investment objective of each Fund is to maximize total return, consisting of
current income and capital appreciation, both realized and unrealized, through
active management of a portfolio of investment grade fixed income securities.
Any investment involves risk, and there can be no assurance that the Funds will
achieve their investment objectives. The investment objective of each Fund may
not be altered without the prior approval of a majority (as defined by the
Investment Company Act of 1940) of the Fund's shares.
The Advisor's philosophy in the management of fixed income securities utilizes a
disciplined balance between sector selection and moderate portfolio duration
shifts to maximize total return. The Advisor's determination of optimal duration
for each Fund is based on economic indicators, inflation trends, credit demands,
monetary policy and global influences as well as psychological and technical
factors. The Funds endeavor to invest in securities and market sectors which the
Advisor believes are undervalued by the marketplace. The selection of
undervalued bonds by the Advisor is based on, among other things, historical
yield relationships, credit risk, market volatility and absolute levels of
interest rates, as well as supply and demand factors.
The Funds are designed primarily to allow institutional investors to take
advantage of the professional investment management expertise of Lowe,
Brockenbrough & Tattersall, Inc. Each Fund will be managed in a manner that
closely resembles that of other bond portfolios of similar maturity and duration
managed by the Advisor. The Advisor uses a wide variety of securities and
techniques in managing fixed income portfolios. As the fixed income markets
evolve, the Advisor may invest in other types of securities than those
specifically identified in this Prospectus if the Advisor views these
investments to be consistent with the overall investment objectives and policies
of the Funds. The securities and techniques the Advisor currently expects to
utilize are described below.
DURATION. Duration is an important concept in the Advisor's fixed income
management philosophy. "Duration" and "maturity" are different concepts and
should not be substituted for one another for purposes of understanding the
investment philosophy of either Fund. The Advisor believes that for most fixed
income securities "duration" provides a better measure of interest rate
sensitivity than maturity. Whereas maturity takes into account only the final
principal payments to determine the risk of a particular bond, duration weights
all potential cash flows (principal, interest and reinvestment income) on an
expected present value basis, to determine the "effective life" of the security.
<PAGE>
The Advisor intends to limit the portfolio duration of the Bond Fund to a 2 year
minimum and a 6 year maximum. The Advisor intends to maintain a portfolio
duration for the Short Term Fund of less than 3 years. In addition, the Advisor
intends to limit the duration of any one single security of the Short Term Fund
to a maximum duration of 5 years. The precise point of each Fund's duration
within these ranges will depend on the Advisor's view of the market. For the
purposes of the Funds, the duration calculation used is Macaulay duration
adjusted for option features (such as call features or prepayment options).
Adjusting for option features requires assumptions with respect to the
probability of that option being exercised. These assumptions will be determined
by the Advisor based on then current market conditions.
The Funds expect the average maturity of their portfolios to be longer than the
average duration. How much longer will depend upon, among other factors, the
composition of coupons (higher coupons imply shorter duration), as well as
overall interest rate levels (higher interest rates generally will result in
shorter duration relative to maturity). It should be noted that for some
securities the standard duration calculation does not accurately reflect
interest rate sensitivity. For example, mortgage pass-through securities,
Collateralized Mortgage Obligations and Asset Backed Securities require
estimates of principal prepayments which are critical in determining interest
rate sensitivity. Floating rate securities, because of the interest rate
adjustment feature, are not appropriate for the standard duration calculation.
In these and other similar situations, the Advisor will use more sophisticated
techniques to determine interest rate sensitivity of securities of the Funds.
INVESTMENT GRADE SECURITIES. Each Fund intends to limit its investment purchases
to investment grade securities. The Funds define investment grade securities as
those securities which, in the Advisor's opinion, have the characteristics
described by any of the nationally recognized statistical rating organizations
("NRSROs"), Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's
Ratings Group ("S&P"), Fitch Investors Service, Inc. ("Fitch") or Duff & Phelps
("D&P"), in their four highest rating grades. For S&P, Fitch and D&P those
ratings are AAA, AA, A and BBB. For Moody's those ratings are Aaa, Aa, A and
Baa. For a description of each rating grade, see the Statement of Additional
Information.
Each Fund invests exclusively in those securities rated investment grade by one
or more of the NRSROs or, if not rated, are considered by the Advisor to have
essentially the same characteristics and quality as securities having such
ratings. There may also be instances where the Advisor purchases securities
which are rated investment grade by one NRSRO and
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<PAGE>
which are not rated or rated below investment grade by other NRSROs, and such
securities would be eligible for purchase by the Funds. Issues rated within the
fourth highest grade (those rated lower than A) are considered speculative in
certain respects and changes in economic conditions or other circumstances are
more likely to lead to a weakened capacity to pay principal and interest than is
the case with higher grade securities. The final determination of quality and
value will remain with the Advisor. Although the Advisor utilizes the ratings of
various credit rating services as one factor in establishing creditworthiness,
it relies primarily upon it own analysis of factors establishing
creditworthiness. For as long as the Funds hold a fixed income issue, the
Advisor monitors the issuer's credit standing. In the event a security's rating
is reduced below a Fund's minimum requirements, the Fund will sell the security,
subject to market conditions and the Advisor's assessment of the most opportune
time for sale. Although lower rated securities will generally provide higher
yields than higher rated securities of similar maturities, they are subject to a
greater degree of market fluctuation.
U.S. GOVERNMENT SECURITIES. U.S. Government Securities include direct
obligations of the U.S. Treasury, securities issued or guaranteed as to interest
and principal by agencies or instrumentalities of the U.S. Government, or any of
the foregoing subject to repurchase agreements (See "Repurchase Agreements.")
While obligations of some U.S. Government sponsored entities are supported by
the full faith and credit of the U.S. Government, several are supported by the
right of the issuer to borrow from the U.S. Government, and still others are
supported only by the credit of the issuer itself. The guarantee of the U.S.
Government does not extend to the yield or value of the U.S. Government
Securities held by the Funds or to either Fund's shares. See the Statement of
Additional Information for a more detailed description.
MORTGAGE PASS-THROUGH CERTIFICATES. Obligations of the Government National
Mortgage Association ("GNMA"), the Federal National Mortgage Association
("FNMA") and the Federal Home Loan Mortgage Corporation ("FHLMC") include direct
pass-through certificates representing undivided ownership interests in pools of
mortgages. Such certificates are guaranteed as to payment of principal and
interest (but not as to price and yield) by the issuer. In the case of
securities issued by GNMA, the payment of principal and interest would be backed
by the full faith and credit of the U.S. Government. Mortgage pass-through
certificates issued by FNMA or FHLMC would be guaranteed as to payment of
principal and interest by the credit of the issuing U.S. Government agency.
Securities issued by other non-governmental entities (such as commercial banks
or mortgage bankers) may offer credit enhancement such as guarantees,
- 10 -
<PAGE>
insurance, or letters of credit. Mortgage pass-through certificates are subject
to more rapid prepayment than their stated maturity date would indicate; their
rate of prepayment tends to accelerate during periods of declining interest
rates or increased property transfers and, as a result, the proceeds from such
prepayments may be reinvested in instruments which have lower yields. To the
extent such securities were purchased at a premium, such prepayments could
result in capital losses. The issuer of a pass-through mortgage certificate does
not guarantee premiums or market value of its issue.
COLLATERALIZED MORTGAGE OBLIGATIONS. The Funds intend to invest in
collateralized mortgage obligations ("CMOs") which are generally backed by
mortgage pass-through securities or whole mortgage loans. CMOs are usually
structured into classes of varying maturities and principal payment priorities.
The prepayment sensitivity of each class may or may not resemble that of the
CMOs' collateral depending on the maturity and structure of that class. CMOs pay
interest and principal (including prepayments) monthly, quarterly or
semiannually. Most CMOs are AAA rated, reflecting the credit quality of the
underlying collateral; however, some classes carry greater price risk than that
of their underlying collateral. The Advisor will invest in CMO classes only if
their characteristics and interest rate sensitivity fit the investment
objectives and policies of the individual Fund.
OTHER MORTGAGE RELATED SECURITIES. In addition to the mortgage pass-through
securities and the CMOs mentioned above, the Funds may also invest in other
mortgage derivative products if the Advisor views them to be consistent with the
overall policies and objectives of the Funds. Current offerings include
"principal only" (PO) and "interest only" (IO) Stripped Mortgage Backed
Securities ("SMBS"). POs and IOs are created when a mortgage pass-through
certificate is separated into two securities - one security representing a claim
to principal distributions and the other representing a claim to the
corresponding interest payments. As prepayments on the underlying mortgage loans
rise (typically when interest rates fall), the PO security holders receive their
principal sooner than expected, which serves to increase the POs' yield. The IO
security holders receive interest payments only on the outstanding principal
amount of the underlying mortgage loans. Therefore, if prepayments on the
notional principal of the IO rise, the IOs' price will fall. As POs generally
benefit from declining interest rates and IOs generally benefit from rising
interest rates, these securities can provide an effective way to stabilize
portfolio value.
SMBS are much more sensitive to prepayment fluctuations than are regular
mortgage-backed securities and therefore involve more risk. Due to the deep
discounted prices of SMBS, any mismatch in
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actual versus anticipated prepayments of principal will significantly increase
or decrease the yield to maturity. In general, changes in interest rate levels
will have the greatest effect on prepayments. Sufficiently high prepayment rates
could result in purchasers of IOs not recovering the full amount of their
initial investment. The Funds will not invest more than 10% of their total
assets in SMBS.
The Advisor expects that governmental, government related and private entities
may create other mortgage related securities offering mortgage pass-through and
mortgage collateralized instruments in addition to those described herein. As
new types of mortgage related securities are developed and offered to the
investment community, the Advisor will, consistent with the particular Fund's
investment objectives, policies and quality standards, consider making
investments in such new types of mortgage related securities.
ASSET BACKED SECURITIES. Other Asset Backed Securities have been offered to
investors backed by loans such as automobile loans, home equity loans, credit
card receivables, marine loans, recreational vehicle loans and manufactured
housing loans. Typically, Asset Backed Securities represent undivided fractional
interests in a fund whose assets consist of a pool of loans and security
interests in the collateral securing the loans. Payments of principal and
interest on Asset Backed Securities are passed through monthly to certificate
holders. In some cases Asset Backed Securities are divided into senior and
subordinated classes so as to enhance the quality of the senior class.
Underlying loans are subject to prepayment, which may reduce the overall return
to certificate holders. If the subordinated classes are exhausted and the full
amounts due on underlying loans are not received because of unanticipated costs,
depreciation, damage or loss of the collateral securing the contracts, or other
factors, certificate holders may experience delays in payment or losses on Asset
Backed Securities. The Funds may invest in other Asset Backed Securities that
may be developed in the future.
ZERO COUPON AND ORIGINAL ISSUE DISCOUNT ("OID") BONDS. Some securities may be
offered without coupons or with very low coupons. These bonds will typically be
more interest rate sensitive than a comparable maturity current coupon bond. The
majority of zero coupon bonds have been created when a qualified U.S. Government
Security is exchanged for a series of "Strips" through the Federal Reserve Bank.
Strips have been created from, among others, U.S. Treasury, Resolution Trust
Corporation and Financing Corporation securities. A number of U.S. Government
Securities have also been repackaged by broker-dealers or commercial banks into
trusts which issue zero coupon receipts such as U.S. Treasury Receipts ("TRs")
or Treasury Investment
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Growth Receipts ("TIGRs"). Zero coupon and original issue discount bonds
generate income under generally accepted accounting principles, but do not
generate cash flow, resulting in the possibility that the Funds may be required
to sell portfolio securities to make distributions as required under Subchapter
M of the Internal Revenue Code.
CORPORATE BONDS. The Funds' investments in corporate debt securities will be
based on credit analysis and value determination by the Advisor. The Advisor's
selection of bonds or industries within the corporate bond sector is determined
by, among other factors, historical yield relationships between bonds or
industries, the current and anticipated credit of the borrower, and call
features, as well as supply and demand factors.
VARIABLE AND FLOATING RATE SECURITIES. The Funds may invest in variable or
floating rate securities which adjust the interest rate paid at periodic
intervals based on an interest rate index. Typically floating rate securities
use as their benchmark an index such as the 1, 3 or 6 month LIBOR, 3, 6 or 12
month Treasury bills, or the Federal Funds rate. Resets of the rates can occur
at predetermined intervals or whenever changes in the benchmark index occur.
MONEY MARKET INSTRUMENTS. Money market instruments will typically represent a
portion of each Fund's portfolio, as funds awaiting investment, to accumulate
cash for anticipated purchases of portfolio securities and to provide for
shareholder redemptions and operational expenses of the Funds. Money market
instruments mature in thirteen months or less from the date of purchase and
include U.S. Government Securities (defined above) and corporate debt securities
(including those subject to repurchase agreements), bankers' acceptances and
certificates of deposit of domestic branches of U.S. banks, and commercial paper
(including variable amount demand master notes). At the time of purchase, money
market instruments will have a short-term rating in the highest category from
any NRSRO or, if not so rated, issued by a corporation having an outstanding
unsecured debt issue rated in the three highest categories of any NRSRO or, if
not so rated, of equivalent quality in the Advisor's opinion. See the Statement
of Additional Information for a further description of money market instruments.
INVESTMENT COMPANIES. The Bond Fund may invest in the securities of open-end and
closed-end investment companies which are generally authorized to invest in
securities eligible for purchase by the Fund. To the extent the Fund does so,
Fund shareholders would indirectly pay a portion of the operating costs of the
underlying investment companies. These costs include management, brokerage,
shareholder servicing and other
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operational expenses. Indirectly, then, shareholders may pay higher operational
costs than if they owned the underlying investment companies directly.
In addition, shares of closed-end investment companies frequently trade at a
discount from their net asset values. This characteristic of shares of a
closed-end investment company is a risk separate and distinct from the risk that
its net asset value will decrease.
The Bond Fund does not presently intend to invest more than 10% of its total
assets in securities of other investment companies. In addition, the Fund will
not invest more than 5% of its total assets in securities of any single
investment company, nor will it purchase more than 3% of the outstanding voting
securities of any investment company.
FACTORS TO CONSIDER. Neither Fund is intended to be a complete investment
program and there can be no assurance that the Funds will achieve their
investment objectives. The fixed income securities in which the Funds will
invest are subject to fluctuation in value. Such fluctuations may be based on
movements in interest rates or on changes in the creditworthiness of the
issuers, which may result from adverse business and economic developments or
proposed corporate transactions, such as a leveraged buy-out or recapitalization
of the issuer. The value of the Funds' fixed income securities will generally
vary inversely with the direction of prevailing interest rate movements.
Consequently, should interest rates increase or the creditworthiness of an
issuer deteriorate, the value of the Funds' fixed income securities would
decrease in value, which would have a depressing influence on the Funds' net
asset values. The Funds may borrow using their assets as collateral, but only
under certain limited conditions. Borrowing, if done, would tend to exaggerate
the effects of market fluctuations on a Fund's net asset value until repaid.
(See "Borrowing.")
SECURITIES LENDING. Each Fund may lend up to 33% of its portfolio securities to
broker-dealers or other institutional investors. Since there could be a delay in
the recovery of loaned securities or even a loss of rights in collateral
supplied should the borrower fail financially, loans will not be made unless, in
the judgment of the Advisor, the consideration to be earned from such loans
would justify the risk. Collateral will be maintained in excess of 100% of the
value of the underlying securities, determined by marking to market daily those
securities involved in the lending program. It is expected that the Funds will
use the cash portions of loan collateral to invest in short-term
income-producing securities. These practices may be amended from time to time as
regulatory provisions permit. Securities lending for purposes of discussion in
this Prospectus should not be confused with "Borrowing" below.
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BORROWING. Each Fund may borrow, temporarily, up to 5% of its total assets for
extraordinary purposes and may increase this limit to 15% of its total assets to
meet redemption requests which might otherwise require untimely disposition of
portfolio holdings. To the extent the Funds borrow for these purposes, the
effects of market price fluctuations on portfolio net asset value will be
exaggerated. If while such borrowing is in effect, the value of the particular
Fund's assets declines, the Fund would be forced to liquidate portfolio
securities when it is disadvantageous to do so. The Funds would incur interest
and other transaction costs in connection with such borrowing. A Fund will not
make any additional investments while its outstanding borrowings exceed 5% of
the current value of its total assets.
PORTFOLIO TURNOVER. Portfolio turnover will not be a limiting factor when the
Advisor deems changes appropriate. While portfolio turnover is difficult to
predict in an active fixed income portfolio, it is expected that annual
portfolio turnover will vary between 100% and 500% with respect to each Fund.
Market conditions may dictate, however, a higher rate of turnover in a
particular year. The degree of portfolio turnover affects the brokerage costs of
the Funds and may have an impact on the amount of taxable distributions to
shareholders. The portfolio turnover of the Bond Fund and of the Short Term Fund
for the fiscal year ended March 31, 1997 was 207% and 62%, respectively.
REPURCHASE AGREEMENTS. The Funds may acquire U.S. Government Securities or other
high-grade debt securities subject to repurchase agreements. A repurchase
agreement transaction occurs when the Funds acquire a security and
simultaneously resell it to the vendor (normally a member bank of the Federal
Reserve or a registered Government Securities dealer) for delivery on an agreed
upon future date. The repurchase price exceeds the purchase price by an amount
which reflects an agreed upon market interest rate earned by the Funds effective
for the period of time during which the repurchase agreement is in effect.
Delivery pursuant to the resale typically will occur within one to five days of
the purchase. For purposes of the Investment Company Act of 1940 (the "1940
Act"), a repurchase agreement is considered to be a loan collateralized by the
securities subject to the repurchase agreement. Neither Fund will enter into a
repurchase agreement which will cause more than 10% of its assets to be invested
in repurchase agreements which extend beyond seven days and other illiquid
securities.
INVESTMENT LIMITATIONS. For the purpose of limiting the Funds' exposure to
risk, each Fund has adopted certain limitations which, together with its
investment objective, are considered fundamental policies which may not be
changed without shareholder approval. Each Fund will not: (1) issue senior
securities,
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borrow money or pledge its assets, except that it may borrow from banks as a
temporary measure (a) for extraordinary or emergency purposes, in amounts not
exceeding 5% of either Fund's total assets, or (b) in order to meet redemption
requests which might otherwise require untimely disposition of portfolio
securities, in amounts not exceeding 15% of either Fund's total assets, and may
pledge its assets to secure all such borrowings; (2) invest more than 10% of a
Fund's assets in other illiquid securities, including repurchase agreements
maturing in over seven days, and other securities for which there is no
established market or for which market quotations are not readily available; (3)
write, acquire or sell puts, calls or combinations thereof, or purchase or sell
commodities, commodities contracts, futures contracts or related options; and
(4) invest more than 5% of its total assets in the securities of any one issuer.
Other fundamental investment limitations are listed in the Statement of
Additional Information.
HOW TO PURCHASE SHARES
There are NO SALES COMMISSIONS CHARGED TO INVESTORS. Assistance in opening
accounts may be obtained from the Administrator by calling 1-800-443-4249, or by
writing to the Funds at the address shown below for regular mail orders.
Assistance is also available through any broker-dealer authorized to sell shares
of the Funds. Such broker-dealer may charge you a fee for its services. Payment
for shares purchased may be made through your account at the broker-dealer
processing your application and order to purchase. Your investment will purchase
shares at a Fund's net asset value next determined after your order is received
by the Funds in proper order as indicated herein. Shares of the Funds purchased
prior to July 31, 1997 are Institutional Shares.
The minimum initial investment in the Bond Fund is $500,000.
The minimum initial investment in the Short Term Fund is $100,000.
The Funds may, in the Advisor's sole discretion, accept certain accounts with
less than the stated minimum initial investment.
Payment must be made by check or money order drawn on a U.S. bank and payable in
U.S. dollars. All orders received by the Administrator, whether by mail, bank
wire or facsimile order from a qualified broker-dealer, prior to 4:00 p.m.,
Eastern time, will purchase shares at the net asset value next determined on
that business day. If your order is not received by 4:00 p.m. Eastern time, your
order will purchase shares at the net asset value determined on the next
business day. (See "How Net Asset Value is Determined.")
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<PAGE>
Due to Internal Revenue Service ("IRS") regulations, applications without social
security or tax identification numbers will not be accepted. If, however, you
have already applied for a social security or tax identification number at the
time of completing your account application, the application should so indicate.
The Funds are required to, and will, withhold taxes on all distributions and
redemption proceeds if the number is not delivered to the Funds within 60 days.
Investors should be aware that the Funds' account application contains
provisions in favor of the Funds, the Administrator and certain of their
affiliates, excluding such entities from certain liabilities (including, among
others, losses resulting from unauthorized shareholder transactions) relating to
the various services made available to investors.
Should an order to purchase shares be cancelled because your check does not
clear, you will be responsible for any resulting losses or fees incurred by the
Funds or the Administrator in the transaction.
REGULAR MAIL ORDERS. Please complete and sign the Account Application form
accompanying this Prospectus and send it with your check, made payable to the
appropriate Fund, and mail it to:
THE JAMESTOWN BOND FUNDS
C/O SHAREHOLDER SERVICES
P.O. BOX 5354
CINCINNATI, OHIO 45201-5354
BANK WIRE ORDERS. Investments can be made directly by bank wire. To establish a
new account or add to an existing account by wire, please call the Funds, at
1-800-443-4249, before wiring funds, to advise the Funds of the investment, the
dollar amount and the account registration. This will ensure prompt and accurate
handling of your investment. Please have your bank use the following wiring
instructions to purchase by wire:
Star Bank, N.A.
Cincinnati Trust
ABA# 042000013
For Williamsburg Investment Trust #485777056
For either: The Jamestown Bond Fund or
The Jamestown Short Term Bond Fund
(Shareholder name and account number)
It is important that the wire contain all the information and that the Funds
receive prior telephone notification to ensure proper credit. Once your wire is
sent you should, as soon as possible thereafter, complete and mail your Account
Application to the Funds as described under "Regular Mail Orders," above.
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ADDITIONAL INVESTMENTS. You may add to your account by mail or wire (minimum
additional investment of $1,000) at any time by purchasing shares at the then
current net asset value as aforementioned. Before making additional investments
by bank wire, please call the Funds at 1-800-443-4249 to alert the Funds that
your wire is to be sent. Follow the wire instructions above to send your wire.
When calling for any reason, please have your account number ready, if known.
Mail orders should include, when possible, the "Invest by Mail" stub which is
attached to your Fund confirmation statement. Otherwise, be sure to identify
your account in your letter.
EXCHANGE PRIVILEGE. You may use proceeds from the redemption of shares of either
Fund to purchase Institutional Shares of the other Fund offering shares for sale
in your state of residence. There is no charge for this exchange privilege.
Before making an exchange, you should read the portion of the Prospectus
relating to the Fund into which the shares are to be exchanged. The shares of
the Fund to be acquired will be purchased at the net asset value next determined
after acceptance of the exchange request in writing by the Administrator. The
exchange of shares of one Fund for shares of the other Fund is treated, for
federal income tax purposes, as a sale on which you may realize taxable gain or
loss. To prevent the abuse of the exchange privilege to the disadvantage of
other shareholders, each Fund reserves the right to terminate or modify the
exchange offer upon 60 days' notice to shareholders.
EMPLOYEES AND AFFILIATES OF THE FUNDS. The minimum purchase requirement is not
applicable to accounts of Trustees, officers or employees of the Funds or
certain parties related thereto. The minimum initial investment for such
accounts is $5,000. See the Statement of Additional Information for further
details.
STOCK CERTIFICATES. Stock certificates will not be issued for your shares.
Evidence of ownership will be given by issuance of periodic account statements
which will show the number of shares owned.
HOW TO REDEEM SHARES
Shares of the Funds may be redeemed on each day that the Funds are open for
business by sending a written request to the Funds. The Funds are open for
business on each day the New York Stock Exchange (the "Exchange") is open for
business. Any redemption may be for more or less than the purchase price of your
shares depending on the market value of the Funds' portfolio securities. All
redemption orders received in proper form, as indicated herein, by the
Administrator prior to 4:00 p.m. Eastern time will redeem shares at the net
asset value determined as of that business day's close of trading. Otherwise,
your order will
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<PAGE>
redeem shares on the next business day. You may also redeem your shares through
a broker-dealer who may charge you a fee for its services.
The Board of Trustees reserves the right to involuntarily redeem any account
having an account value of less than $100,000 (due to redemptions, exchanges or
transfers, and not due to market action) upon 60 days' written notice. If the
shareholder brings his account value up to $100,000 or more during the notice
period, the account will not be redeemed. Redemptions from retirement plans may
be subject to tax withholding.
If you are uncertain of the requirements for redemption, please contact the
Funds, at 1-800-443-4249, or write to the address shown below.
REGULAR MAIL REDEMPTIONS. Your request should be addressed to
The Jamestown Bond Funds, P.O. Box 5354, Cincinnati, Ohio 45201-
5354. Your request for redemption must include:
1) your letter of instruction or a stock assignment specifying
the Bond Fund or the Short Term Fund, the account number, and
the number of shares or dollar amount to be redeemed. This
request must be signed by all registered shareholders in the
exact names in which they are registered;
2) any required signature guarantees (see "Signature
Guarantees"); and
3) other supporting legal documents, if required in the case of
estates, trusts, guardianships, custodianships, corporations,
partnerships, pension or profit sharing plans, and other
organizations.
Your redemption proceeds will be mailed to you within three business days after
receipt of your redemption request. However, a Fund may delay forwarding a
redemption check for recently purchased shares while it determines whether the
purchase payment will be honored. Such delay (which may take up to 15 days) may
be reduced or avoided if the purchase is made by certified check, government
check or wire transfer. In such cases, the net asset value next determined after
receipt of the request for redemption will be used in processing the redemption
and your redemption proceeds will be mailed to you upon clearance of your check
to purchase shares. The Funds may suspend redemption privileges or postpone the
date of payment (i) during any period that the Exchange is closed, or trading on
the Exchange is restricted as determined by the Securities and Exchange
Commission (the "Commission"), (ii) during any period when an emergency exists
as defined by the rules of the Commission as a result of which it is not
reasonably practicable for the Funds to dispose of securities owned by them, or
to fairly determine the value of their assets, and (iii) for such other periods
as the Commission may permit.
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<PAGE>
You can choose to have redemption proceeds mailed to you at your address of
record, your bank, or to any other authorized person, or you can have the
proceeds sent by bank wire to your bank ($5,000 minimum). Shares of the Funds
may not be redeemed by wire on days in which your bank is not open for business.
Redemption proceeds will only be sent to the bank account or person named in
your Account Application currently on file with the Funds. You can change your
redemption instructions anytime you wish by filing a letter including your new
redemption instructions with the Funds. (See "Signature Guarantees.")
There is currently no charge by the Administrator for wire redemptions. However,
the Administrator reserves the right, upon thirty days' written notice, to make
reasonable charges for wire redemptions. All charges will be deducted from your
account by redemption of shares in your account. Your bank or brokerage firm may
also impose a charge for processing the wire. In the event that wire transfer of
funds is impossible or impractical, the redemption proceeds will be sent by mail
to the designated account.
SIGNATURE GUARANTEES. To protect your account and the Funds from fraud,
signature guarantees are required to be sure that you are the person who has
authorized a change in registration, or standing instructions, for your account.
Signature guarantees are required for (1) change of registration requests, and
(2) requests to establish or change redemption services other than through your
initial account application. Signature guarantees are acceptable from a member
bank of the Federal Reserve System, a savings and loan institution, credit
union, registered broker-dealer or a member firm of a U.S. Stock Exchange, and
must appear on the written request for redemption, or change of registration.
HOW NET ASSET VALUE IS DETERMINED
The net asset value of each Fund is determined on each business day that the
Exchange is open for trading, as of the close of the Exchange (currently 4:00
p.m., Eastern time). Net asset value per share is determined by dividing the
total value of all Fund securities (valued at market value) and other assets,
less liabilities, by the total number of shares then outstanding. Net asset
value includes interest on fixed income securities, which is accrued daily. See
the Statement of Additional Information for further details.
Securities which are traded over-the-counter are priced at the last sale price,
if available, otherwise, at the last quoted bid price. Securities traded on a
national exchange will be valued based upon the closing price on the valuation
date on the principal exchange where the security is traded. It is expected that
fixed income securities will ordinarily be traded in the
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over-the-counter market. When market quotations are not readily available, fixed
income securities may be valued on the basis of prices provided by an
independent pricing service. The prices provided by the pricing service are
determined with consideration given to institutional bid and last sale prices
and take into account securities prices, yields, maturities, call features,
ratings, institutional trading in similar groups of securities and developments
related to specific securities. The Trustees will satisfy themselves that such
pricing services consider all appropriate factors relevant to the value of such
securities in determining their fair value. Securities and other assets for
which no quotations are readily available will be valued in good faith at fair
value using methods determined by the Board of Trustees.
MANAGEMENT OF THE FUNDS
The Funds are diversified series of the Williamsburg Investment Trust (the
"Trust"), an investment company organized as a Massachusetts business trust in
July 1988, which was formerly known as The Nottingham Investment Trust. The
Board of Trustees has overall responsibility for management of the Funds under
the laws of Massachusetts governing the responsibilities of trustees of business
trusts. The Statement of Additional Information identifies the Trustees and
officers of the Trust and the Funds and provides information about them.
INVESTMENT ADVISOR. Subject to the authority of the Board of Trustees, Lowe,
Brockenbrough & Tattersall Strategic Advisors, Inc. (the "Advisor") provides the
Funds with a continuous program of supervision of each Fund's assets, including
the composition of its portfolio, and furnishes advice and recommendations with
respect to investments, investment policies and the purchase and sale of
securities, pursuant to Investment Advisory Agreements with the Trust. The
Advisor is also responsible for the selection of broker-dealers through which
the Funds execute portfolio transactions, subject to brokerage policies
established by the Trustees, and provides certain executive personnel to the
Funds.
The Advisor is a Virginia corporation controlled by Fred T. Tattersall. Prior to
February 28, 1997, the investment advisor to each Fund was Lowe, Brockenbrough &
Tattersall, Inc. ("LB&T"), of which Mr. Tattersall and Austin Brockenbrough III
were the controlling shareholders. On February 28, 1997, LB&T was reorganized by
means of a corporate restructuring into two separate legal entities: LB&T, owned
by Mr. Brockenbrough, and the Advisor, owned by Mr. Tattersall. The Advisor
manages the fixed-income accounts (including the Funds) formerly managed by
LB&T. In addition to acting as Advisor to the Funds, the Advisor provides
investment advice to corporations, trusts, pension and profit sharing plans,
other business and institutional accounts and individuals. The Advisor also
serves as sub-advisor to The
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Jamestown Balanced Fund (another series of the Trust), the subject of a separate
prospectus.
Both the Bond Fund and the Short Term Fund are managed on a day to day basis by
a committee comprised of the Advisor's fixed income portfolio management
professionals, with each portfolio professional responsible for designated
specific sectors of the fixed income market. Prior to February 28, 1997, the
Funds were managed by the same group of professionals, but such professionals
were employed by LB&T.
Compensation of the Advisor is at the annual rate of 0.375% of each Fund's
average daily net assets. For the fiscal year ended March 31, 1997, the Advisor
and LB&T received $289,094 in investment advisory fees from the Bond Fund, which
represented 0.375% of the Bond Fund's average daily net assets. For the fiscal
year ended March 31, 1997, the Advisor and LB&T each waived its entire
investment advisory fee from the Short Term Fund and reimbursed the Fund for
$6,864 of other operating expenses.
The Advisor currently intends to waive its investment advisory fees to the
extent necessary to limit the total operating expenses of Institutional Shares
of the Short Term Fund to 0.50% per annum of its average daily net assets.
However, there is no assurance that any voluntary fee waivers will continue in
the current or future fiscal years, and expenses of Institutional Shares of the
Short Term Fund may therefore exceed 0.50% of its average daily net assets.
The Advisor's address is 6620 West Broad Street, Suite 300, Richmond, Virginia
23230.
ADMINISTRATOR. The Funds have retained Countrywide Fund Services, Inc. (the
"Administrator"), P.O. Box 5354, Cincinnati, Ohio 45201, to provide
administrative, pricing, accounting, dividend disbursing, shareholder servicing
and transfer agent services. The "Administrator is a wholly-owned indirect
subsidiary of Countrywide Credit Industries, Inc., a New York Stock Exchange
listed company principally engaged in the business of residential mortgage
lending.
The Administrator supplies executive, administrative and regulatory services,
supervises the preparation of tax returns, and coordinates the preparation of
reports to shareholders and reports to and filings with the Securities and
Exchange Commission and state securities authorities. In addition, the
Administrator calculates daily net asset value per share and maintains such
books and records as are necessary to enable it to perform its duties.
Each Fund pays the Administrator a base fee for these services at the annual
rate of 0.075% of the average value of its daily net
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assets up to $200 million and 0.05% of such assets in excess of $200 million
(subject to a minimum fee of $2,000 per month with respect to each Fund) plus a
surcharge of $1,000 per month. The Administrator also charges the Funds for
certain costs involved with the daily valuation of investment securities and is
reimbursed for out-of-pocket expenses.
CUSTODIAN. The Custodian of the Funds' assets is Star Bank, N.A.
(the "Custodian"). The Custodian's mailing address is 425 Walnut
Street, Cincinnati, Ohio 45202. The Advisor, Administrator or
interested persons thereof may have banking relationships with
the Custodian.
OTHER FUND COSTS. The Funds pay all expenses not assumed by the Advisor,
including its fees. Fund expenses include, among others, the fees and expenses,
if any, of the Trustees and officers who are not "affiliated persons" of the
Advisor, fees of the Funds' Custodian, interest expense, taxes, brokerage fees
and commissions, fees and expenses of the Funds' shareholder servicing
operations, fees and expenses of qualifying and registering the Funds' shares
under federal and state securities laws, expenses of preparing, printing and
distributing prospectuses and reports to existing shareholders, auditing and
legal expenses, insurance expenses, association dues, and the expense of
shareholders' meetings and proxy solicitations. The Funds are also liable for
any nonrecurring expenses that may arise such as litigation to which the Funds
may be a party. The Funds may be obligated to indemnify the Trustees and
officers with respect to such litigation. All expenses of a Fund are accrued
daily on the books of such Fund at a rate which, to the best of its belief, is
equal to the actual expenses expected to be incurred by the Fund in accordance
with generally accepted accounting practices. For the fiscal year ended March
31, 1997, the expense ratio of the Bond Fund was 0.53% of its average daily net
assets and the expense ratio of the Short Term Fund was 0.50% of its average
daily net assets after expense reimbursements.
BROKERAGE. The Funds have adopted brokerage policies which allow the Advisor to
prefer brokers which provide research or other valuable services to the Advisor
and/or the Funds. In all cases, the primary consideration for selection of
broker-dealers through which to execute brokerage transactions will be to obtain
the most favorable price and execution for the Funds. Research services obtained
through the Funds' brokerage transactions may be used by the Advisor for its
other clients; conversely, the Funds may benefit from research services obtained
through the brokerage transactions of the Advisor's other clients. The Statement
of Additional Information contains more information about the management and
brokerage practices of the Funds. It is anticipated that most securities
transactions of the Funds will be handled on a principal, rather than agency,
basis. Fixed
- 23 -
<PAGE>
income securities are normally traded on a net basis (without commission)
through broker-dealers and banks acting for their own account. Such firms
attempt to profit from buying at the bid price and selling at the higher asked
price of the market, the difference being referred to as the spread.
DIVIDENDS, DISTRIBUTIONS, TAXES AND OTHER INFORMATION
The Statement of Additional Information contains additional information about
the federal income tax implications of an investment in the Funds in general
and, particularly, with respect to dividends and distributions and other
matters. Shareholders should be aware that dividends from the Funds which are
derived in whole or in part from interest on U.S. Government Securities may not
be taxable for state income tax purposes. Other state income tax implications
are not covered, nor is this discussion exhaustive on the subject of federal
income taxation. Consequently, investors should seek qualified tax advice.
Each Fund intends to remain qualified as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986 (the "Code") and will
distribute all of its net income and realized capital gains to shareholders.
Shareholders are liable for taxes on distributions of net income and realized
capital gains of the Funds but, of course, shareholders who are not subject to
tax on their income will not be required to pay taxes on amounts distributed to
them. The Funds intend to declare dividends quarterly, payable in March, June,
September and December, on a date selected by the Trustees. In addition,
distributions may be made annually in December out of any net short-term or
long-term capital gains derived from the sale of securities realized through
October 31 of that year. Each Fund may make a supplemental distribution of
capital gains at the end of its fiscal year. The nature and amount of all
dividends and distributions will be identified separately when tax information
is distributed by the Funds at the end of each year. The Funds intend to
withhold 30% on taxable dividends and any other payments that are subject to
such withholding and are neither citizens nor residents of the U.S.
There is no fixed dividend rate, and there can be no assurance as to the payment
of any dividends or the realization of any gains for either Fund. Current
practice of the Funds, subject to the discretion of the Board of Trustees, is
for declaration and payment of income dividends during the last week of each
calendar quarter. All dividends and capital gains distributions are reinvested
in additional shares of the Funds unless the shareholder requests in writing to
receive dividends and/or capital gains distributions in cash. That request must
be received by the Funds prior to the record date to be effective as to the next
dividend. Tax consequences to shareholders of
- 24 -
<PAGE>
dividends and distributions are the same if received in cash or
if received in additional shares of the Funds.
TAX STATUS OF THE FUNDS. If a Fund is qualified as a "regulated investment
company" under the Code, it will not be liable for federal income taxes on
amounts paid as dividends and distributions. The Code contains a number of
complex requirements which an investment company must meet in order to qualify.
For a more detailed discussion of the tax status of the Funds, see "Additional
Tax Information" in the Statement of Additional Information.
PRINCIPAL SHAREHOLDERS. Rockingham Health Care, Inc., 235 Cantrell Avenue,
Harrisonburg, Virginia, owned of record 54.4% of the Short Term Fund's
outstanding shares as of May 23, 1997 and may be deemed to control the Fund.
DESCRIPTION OF FUND SHARES AND OTHER MATTERS. The Declaration of Trust of the
Williamsburg Investment Trust currently provides for the shares of eleven funds,
or series, to be issued. Shares of all eleven series have currently been issued,
in addition to the Bond Fund and the Short Term Fund described in this
Prospectus: shares of the FBP Contrarian Balanced Fund and the FBP Contrarian
Equity Fund, which are managed by Flippin, Bruce & Porter, Inc. of Lynchburg,
Virginia; shares of The Government Street Equity Fund, The Government Street
Bond Fund and The Alabama Tax Free Bond Fund, which are managed by T. Leavell &
Associates, Inc. of Mobile, Alabama; and shares of The Jamestown Balanced Fund,
The Jamestown Equity Fund, The Jamestown International Equity Fund and The
Jamestown Tax Exempt Virginia Fund, which are managed by Lowe, Brockenbrough &
Tattersall, Inc. The Trustees are permitted to create additional series at any
time.
Shares are freely transferable, have no preemptive or conversion rights and,
when issued, are fully paid and non-assessable. Upon liquidation of the Trust or
a particular Fund of the Trust, holders of the outstanding shares of the Fund
being liquidated shall be entitled to receive, in proportion to the number of
shares of the Fund held by them, the excess of that Fund's assets over its
liabilities. Each outstanding share is entitled to one vote for each full share
and a fractional vote for each fractional share, on all matters which concern
the Trust as a whole. On any matter submitted to a vote of shareholders, all
shares of the Trust then issued and outstanding and entitled to vote,
irrespective of the Fund, shall be voted in the aggregate and not by Fund,
except (i) when required by the 1940 Act, shares shall be voted by individual
Fund; and (ii) when the matter does not affect any interest of a particular
Fund, then only shareholders of the affected Fund or Funds shall be entitled to
vote thereon. Examples of matters which affect only a particular Fund could be a
proposed change in the fundamental investment objectives or policies of that
Fund or a proposed change in the
- 25 -
<PAGE>
investment advisory agreement for a particular Fund. Each class of shares of the
Funds shall vote separately on matters relating to its own distribution
arrangements. The shares of the Funds have noncumulative voting rights, which
means that the holders of more than 50% of the shares voting for the election of
Trustees can elect all of the Trustees if they so choose.
The Declaration of Trust provides that the Trustees may hold office
indefinitely, except that: (1) any Trustee may resign or retire; and (2) any
Trustee may be removed with or without cause at any time: (a) by a written
instrument, signed by at least two-thirds of the number of Trustees prior to
such removal; (b) by vote of shareholders holding not less than two-thirds of
the outstanding shares of the Trust, cast in person or by proxy at a meeting
called for that purpose; or (c) by a written declaration signed by shareholders
holding not less than two-thirds of the outstanding shares of the Trust and
filed with the Trust's custodian. In case a vacancy or an anticipated vacancy
shall for any reason exist, the vacancy shall be filled by the affirmative vote
of a majority of the remaining Trustees, subject to the provisions of Section
16(a) of the 1940 Act.
Any group of shareholders representing 10% or more of the shares then
outstanding may call a meeting for the purpose of removing one or more of the
Trustees. If shareholders desire to call a meeting to consider the removal of
one or more Trustees, they will be assisted in communicating with other
shareholders. See the Statement of Additional Information for more information.
Shareholder inquiries may be made in writing, addressed to the Funds at the
address shown on the cover.
Under Massachusetts law, shareholders of a business trust may, under certain
circumstances, be held personally liable as partners for the obligations of the
Trust. The Declaration of Trust, therefore, contains provisions which are
intended to mitigate such liability. See the Statement of Additional Information
for further information about the Trust and its shares.
CALCULATION OF PERFORMANCE DATA. From time to time each Fund may advertise its
total return. Each Fund may also advertise yield. Both yield and total return
figures are based on historical earnings and are not intended to indicate future
performance. Total return and yield are computed separately for Consultant and
Institutional Shares. The yield of Institutional Shares is expected to be higher
than the yield of Consultant Shares due to the distribution fees imposed on
Consultant Shares.
The "total return" of a Fund refers to the average annual compounded rates of
return over 1, 5 and 10 year periods that
- 26 -
<PAGE>
would equate an initial amount invested at the beginning of a stated period to
the ending redeemable value of the investment. The calculation of total return
assumes the reinvestment of all dividends and distributions, includes all
recurring fees that are charged to all shareholder accounts and deducts all
nonrecurring charges at the end of each period. If a Fund has been operating
less than 1, 5 or 10 years, the time period during which the Fund has been
operating is substituted.
In addition, the Funds may advertise other total return performance data
("Nonstandardized Return"). Nonstandardized Return shows as a percentage rate of
return encompassing all elements of return (i.e., income and capital
appreciation or depreciation); it assumes reinvestment of all dividends and
capital gain distributions. Nonstandardized Return may be quoted for the same or
different periods as those for which standardized return is quoted.
Nonstandardized Return may consist of a cumulative percentage rate of return,
actual year-by-year rates or any combination thereof.
The "yield" of a Fund is computed by dividing the net investment income per
share earned during a thirty-day (or one month) period stated in the
advertisement by the maximum offering price per share on the last day of the
period (using the average number of shares entitled to receive dividends). The
yield formula assumes that net investment income is earned and reinvested at a
constant rate and annualized at the end of a six-month period. For the purpose
of determining net investment income, the calculation includes among expenses of
the Funds all recurring fees that are charged to all shareholder accounts and
any nonrecurring charges for the period stated.
<PAGE>
THE JAMESTOWN BOND FUNDS
INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall Strategic Advisors, Inc.
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
ADMINISTRATOR
Countrywide Fund Services, Inc.
312 Walnut Street
P.O. Box 5354
Cincinnati, Ohio 45201-5354
1-800-443-4249
CUSTODIAN
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT AUDITORS
Tait, Weller & Baker
Two Penn Center Plaza
Philadelphia, Pennsylvania 19102
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard Mitchell
Richard L. Morrill
Harris V. Morrissette
Fred T. Tattersall
Erwin H. Will, Jr.
Samuel B. Witt III
OFFICERS
Fred T. Tattersall, President
Craig D. Truitt, Vice President
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering contained in this Prospectus, and if given or made, such
information or representations must not be relied upon as being authorized by
the Funds. This Prospectus does not constitute an offer by the Funds to sell
shares in any State to any person to whom it is unlawful for the Funds to make
such offer in such State.
- 28 -
<PAGE>
PROSPECTUS
July 31, 1997
THE JAMESTOWN
BOND FUNDS
CONSULTANT SHARES
No-Load Funds
The investment objective of THE JAMESTOWN BOND FUND (the "Bond Fund") is to
maximize total return, consisting of current income and capital appreciation
(both realized and unrealized), consistent with the preservation of capital
through active management of investment grade fixed income securities.
The investment objective of THE JAMESTOWN SHORT TERM BOND FUND (the "Short Term
Fund") is identical to that of the Bond Fund, with the distinction that the
Short Term Fund intends to achieve this objective by investing in a portfolio of
investment grade fixed income securities having a shorter average duration.
The Jamestown Bond Fund and The Jamestown Short Term Bond Fund are designed
primarily for institutional investors who wish to take advantage of the
professional investment management expertise of Lowe, Brockenbrough & Tattersall
Strategic Advisors, Inc., which serves as investment advisor to the Funds.
The Funds offer two classes of shares: Consultant Shares, sold subject to a
12b-1 fee up to .15% of average daily net assets, and Institutional Shares, sold
without a 12b-1 fee. Each Consultant and Institutional Share of the Fund
represents identical interests in the Fund's investment portfolio and has the
same rights, except that (i) Consultant Shares bear the expenses of distribution
fees, which will cause Consultant Shares to have a higher expense ratio and to
pay lower dividends than Institutional Shares; (ii) certain class specific
expenses will be borne solely by the class to which such expenses are
attributable; and (iii) each class has exclusive voting rights with respect to
matters affecting only that class.
INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall Strategic Advisors, Inc.
Richmond, Virginia
The Jamestown Bond Fund and the Jamestown Short Term Bond Fund (the "Funds") are
NO-LOAD, diversified, open-end series of the Williamsburg Investment Trust, a
registered management investment company. This Prospectus provides you with the
basic information you should know before investing in the Funds. You should read
it and keep it for future reference. While there is no assurance that the Funds
will achieve their investment objectives, they endeavor to do so by following
the investment policies described in this Prospectus. Institutional Shares are
offered in a separate prospectus and additional information about Institutional
Shares may be obtained by calling 1-800-443-4249.
<PAGE>
A Statement of Additional Information, dated July 31, 1997 containing additional
information about the Funds, has been filed with the Securities and Exchange
Commission and is incorporated by reference in this Prospectus in its entirety.
The Funds' address is P.O. Box 5354, Cincinnati, Ohio 45201-5354, and their
telephone number is 1-800-443-4249. A copy of the Statement of Additional
Information may be obtained at no charge by calling or writing the Funds.
TABLE OF CONTENTS
PROSPECTUS SUMMARY.......................................................
SYNOPSIS OF COSTS AND EXPENSES...........................................
FINANCIAL HIGHLIGHTS.....................................................
INVESTMENT OBJECTIVES, INVESTMENT POLICIES
AND RISK CONSIDERATIONS. ..............................................
HOW TO PURCHASE SHARES...................................................
HOW TO REDEEM SHARES.....................................................
HOW NET ASSET VALUE IS DETERMINED........................................
MANAGEMENT OF THE FUNDS..................................................
PLAN OF DISTRIBUTION.....................................................
DIVIDENDS, DISTRIBUTIONS, TAXES AND OTHER INFORMATION....................
APPLICATION..............................................................
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- ---------------------------------------------------------------------------
PROSPECTUS SUMMARY
THE FUNDS. The Jamestown Bond Fund (the "Bond Fund") and the Jamestown Short
Term Bond Fund (the "Short Term Fund") are NO- LOAD, diversified, open-end
series of the Williamsburg Investment Trust, a registered management investment
company commonly known as a "mutual fund." Each represents a separate mutual
fund with its own objectives and policies. An investor may elect one or both of
the Funds to meet individual investment objectives, and may switch from one Fund
to the other without charge when a shareholder's investment objectives or plans
change. While there is no assurance that the Funds will achieve their investment
objectives, they each endeavor to do so by following the investment policies
described in this Prospectus. The Funds are primarily designed for tax exempt
institutional investors such as pension and profit-sharing plans, endowments,
foundations, and employee benefit trusts. Corporations and individual investors
may invest in either Fund, although it should be noted that investment decisions
of the Funds will not be influenced by any federal tax considerations, other
than those considerations which apply to the Funds themselves.
- 2 -
<PAGE>
INVESTMENT OBJECTIVES. The Bond Fund and the Short Term Fund are governed by
virtually identical investment objectives and policies, WITH THE EXCEPTION of
the average duration range of the individual Funds. Each Fund seeks to maximize
total return, consisting of current income and capital appreciation (both
realized and unrealized), consistent with the preservation of capital through
active management of investment grade fixed income securities. For a more
detailed explanation of the definition of "investment grade" securities, see
"Investment Objectives, Investment Policies and Risk Considerations."
INVESTMENT APPROACH. The Advisor's philosophy in managing fixed income
portfolios is to emphasize a disciplined balance between sector selection and
moderate portfolio duration shifts to maximize total return. Duration is an
important concept in the Advisor's fixed income management philosophy and, in
the Advisor's opinion, provides a better measure of interest rate sensitivity
than maturity for many fixed income securities. Each Fund intends to invest only
in investment grade securities. Due to their controlled duration and quality
standards, the Funds expect to exhibit less volatility than would mutual funds
with longer average maturities and lower quality portfolios.
INVESTMENT ADVISOR. Lowe, Brockenbrough & Tattersall Strategic Advisors,
Inc. (the "Advisor") serves as investment advisor to each of the Funds. For its
services, the Advisor receives compensation of 0.375% of the average daily net
assets of each Fund. (See "Management of the Funds.")
PURCHASE OF SHARES. Consultant Shares are offered "No-Load," which means
they may be purchased directly from the Funds without the imposition of any
front-end or contingent deferred sales charges. However, Consultant Shares are
subject to the imposition of a 12b-1 fee of up to .15% of average daily net
assets. (See "Plan of Distribution.")
The minimum initial purchase for the Bond Fund is $500,000. The minimum
initial purchase for the Short Term Fund is $100,000.
Subsequent investments in both Funds must be $1,000 or more. Shares may be
purchased by individuals or organizations and may be appropriate for use in Tax
Sheltered Retirement Plans. (See "How to Purchase Shares.")
REDEMPTION OF SHARES. There is currently no charge for redemptions from
either Fund. Shares may be redeemed at any time in which the Funds are open for
business at the net asset value next determined after receipt of a redemption
request by the Funds. (See "How to Redeem Shares.")
- 3 -
<PAGE>
DIVIDENDS AND DISTRIBUTIONS. Net investment income of the Funds is
distributed quarterly. Net capital gains, if any, are distributed annually.
Shareholders may elect to receive dividends and capital gain distributions in
cash or the dividends and capital gain distributions may be reinvested in
additional Fund shares. (See "Dividends, Distributions, Taxes and Other
Information.")
MANAGEMENT. The Funds are series of the Williamsburg Investment Trust (the
"Trust"), the Board of Trustees of which is responsible for overall management
of the Trust and the Funds. The Trust has employed Countrywide Fund Services,
Inc. (the "Administrator") to provide administration, accounting and transfer
agent services. (See "Management of the Funds.")
- 4 -
<PAGE>
SYNOPSIS OF COSTS AND EXPENSES
THE JAMESTOWN BOND FUND
CONSULTANT SHARES
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Exchange Fee None
Redemption Fee None*
Check Redemption Processing Fee (per check)
First six checks per month None
Additional checks per month $0.25
* A wire transfer fee is charged by the Fund's Custodian in the case of
redemptions made by wire. Such fee is subject to change and is
currently $8. See "How to Redeem Shares".
ANNUAL FUND OPERATING EXPENSES:
(As a percentage of net assets)
Investment Advisory Fee................................0.375%
Administrator's Fees...................................0.075%
12b-1 Fees.............................................0.150%
Other Expenses.........................................0.080%
------
Total Fund Operating Expense............................... 0.68%
======
EXAMPLE: You would pay the following expenses on a $1,000 investment,
whether or not you redeem at the end of the period, assuming
5% annual return:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
$ 7 $22 $38 $85
THE JAMESTOWN SHORT TERM BOND FUND
CONSULTANT SHARES
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Exchange Fee None
Redemption Fee None*
Check Redemption Processing Fee (per check)
First six checks per month None
Additional checks per month $0.25
* A wire transfer fee is charged by the Fund's Custodian in the case of
redemptions made by wire. Such fee is subject to change and is
currently $8. See "How to Redeem Shares".
ANNUAL FUND OPERATING EXPENSES:
(As a percentage of net assets)
Investment Advisory Fees (after fee waivers) 0.00%
Administrator's Fees 0.25%
12b-1 Fees 0.15%
Other Expenses (after expense reimbursements) 0.25%
-----
Total Fund Operating Expense 0.65%
=====
- 5 -
<PAGE>
EXAMPLE: You would pay the following expenses on a $1,000 investment,
whether or not you redeem at the end of the period, assuming
5% annual return:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ --------- --------- --------
$ 7 $21 $36 $81
The purpose of the foregoing tables is to assist investors in the Funds in
understanding the various costs and expenses that they will bear directly or
indirectly. See "Management of the Funds" for more information about the fees
and costs of operating the Funds. The Annual Fund Operating Expenses shown above
are based upon actual operating history of Institutional Shares of the Fund for
the fiscal year ended March 31, 1997, adjusted to reflect the imposition of
12b-1 fees applicable to Consultant Shares. Absent the fee waivers and expense
reimbursements by the Advisor, the Short Term Fund's investment advisory fees
would have been 0.375% of average daily net assets, other expenses would have
been 0.32% of average net assets and total fund operating expenses would have
been 1.09% of average daily net assets. THE EXAMPLES SHOWN SHOULD NOT BE
CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES. ACTUAL EXPENSES IN THE
FUTURE MAY BE GREATER OR LESS THAN THOSE SHOWN.
The footnotes to the Financial Highlights table contain information concerning a
decrease in the Bond Fund's expense ratio as a result of a directed brokerage
arrangement.
FINANCIAL HIGHLIGHTS
The following audited financial information with respect to Institutional Shares
of the Fund has been audited by Tait, Weller & Baker, independent accountants,
whose report covering the fiscal year ended March 31, 1997 is contained in the
Statement of Additional Information. This information should be read in
conjunction with the Funds' latest audited annual financial statements and notes
thereto, which are also contained in the Statement of Additional Information, a
copy of which may be obtained at no charge by calling the Funds. As of the date
of this Prospectus, Consultant Shares of the Fund have not been previously
offered to the public.
THE JAMESTOWN BOND FUND
<TABLE>
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each
Period
<CAPTION>
Years Ended March 31,
--------------------------------------------------------
1997 1996 1995 1994 1993
-------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $10.39 $9.97 $10.15 $10.82 $10.42
-------- ------- -------- -------- --------
Income from investment operations:
Net investment income 0.68 0.70 0.62 0.55 0.64
Net realized and unrealized gains (losses) on investments (0.12) 0.41 (0.18) (0.30) 0.55
-------- ------- -------- -------- --------
Total from investment operations 0.56 1.11 0.44 0.25 1.19
-------- ------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.69) (0.69) (0.62) (0.55) (0.64)
Distributions from net realized gains -- -- -- (0.19) (0.15)
Distributions in excess of net realized gains -- -- -- (0.18) --
-------- ------- -------- -------- --------
Total distributions (0.69) (0.69) (0.62) (0.92) (0.79)
-------- ------- -------- -------- --------
Net asset value at end of period $10.26 $10.39 $9.97 $10.15 $10.82
======== ======= ======== ======== ========
Total return 5.52% 11.23% 4.56% 2.12% 11.69%
======== ======= ======== ======== ========
Net assets at end of period (000's) $76,499 $74,774 $72,029 $64,029 $55,718
======== ======= ======== ======== ========
Ratio of expenses to average net assets (b) 0.53% 0.56% 0.53% 0.60% 0.59%
Ratio of net investment income to average net assets 6.48% 6.54% 6.28% 5.03% 6.09%
Portfolio turnover rate 207% 268% 381% 381% 454%
<PAGE>
<CAPTION>
Year Period
Ended Ended
March 31, March 31,
1992 1991 (a)
-------- -------
<S> <C> <C>
Net asset value at beginning of period $ 9.97 $10.00
-------- -------
Income from investment operations:
Net investment income 0.54 0.20
Net realized and unrealized gains (losses) on investments 0.48 (0.03)
-------- -------
Total from investment operations 1.02 0.17
-------- -------
Less distributions:
Dividends from net investment income (0.54) (0.20)
Distributions from net realized gains (0.03) --
Distributions in excess of net realized gains -- --
-------- -------
Total distributions (0.57) (0.20)
-------- -------
Net asset value at end of period $10.42 $ 9.97
======== =======
Total return 10.33% 5.70%(c)
======== =======
Net assets at end of period (000's) $29,727 $ 794
======== =======
Ratio of expenses to average net assets (b) 0.60% 0.90%(c)
Ratio of net investment income to average net assets 6.67% 7.07%(c)
Portfolio turnover rate 484% 54%
<FN>
(a) Represents the period from the commencement of operations
(December 31, 1990) through March 31, 1991.
(b) For the years ended March 31, 1997 and 1996, the ratio of expenses to
average net assets was determined based on gross expenses prior to
expense reimbursements through a directed brokerage arrangement. For
periods prior to March 31, 1996, the ratio was determined based on net
expenses after expense reimbursements through the directed brokerage
arrangement. Absent such expense reimbursements, the ratio of expenses to
average net assets would have been 0.57% for the year ended March 31,
1995. Absent investment advisory fees waived by the Advisor, the ratio
of expenses to average net assets would have been 0.80% and 3.08%(c)
for the periods ended March 31, 1992 and 1991.
(c) Annualized.
</FN>
</TABLE>
- 7 -
<PAGE>
<TABLE>
THE JAMESTOWN SHORT TERM BOND FUND
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each
Period
Years Ended March 31,
--------------------------------------------------------------
1997 1996 1995 1994 1993
------ ----- ----- ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of peiord $9.72 $9.64 $9.82 $10.07 $9.93
------ ------ ----- ------ ------
Income from investment operations:
Net investment income 0.58 0.62 0.60 0.51 0.50
Net realized and unrealized gains (losses)
on investments (0.11) 0.08 (0.17) (0.23) 0.13
------ ------ ----- ------ ------
Total from investment operations 0.47 0.70 0.43 0.28 0.63
------ ------ ----- ------ ------
Less distributions:
Dividends from net investment income (0.58) (0.62) (0.61) (0.51) (0.49)
Distributions from net realized gains -- -- -- (0.02) --
------ ------ ----- ------ ------
Total distributions (0.58) (0.62) (0.61) (0.53) (0.49)
------ ------ ----- ------ ------
Net asset value at end of period $9.61 $9.72 $9.64 $9.82 $10.07
====== ====== ===== ====== ======
Total return 5.01% 7.38% 4.53% 2.76% 6.40%
====== ====== ===== ====== ======
Net assets at end of period (000's) $9,924 $9,426 $14,122 $18,715 $15,580
====== ====== ===== ====== ======
Ratio of expenses to average net assets (b) 0.50% 0.50% 0.50% 0.50% 0.50%
Ratio of net investment income to average net assets 5.96% 6.27% 6.04% 5.22% 5.24%
Portfolio turnover rate 62% 157% 144% 324% 289%
<PAGE>
<CAPTION>
Period
Ended
March 31,
1992(a)
------
<S> <C>
Net asset value at beginning of period $10.00
------
Income from investment operations:
Net investment income 0.09
Net realized and unrealized gains (losses)
on investments (0.07)
------
Total from investment operations 0.02
------
Less distributions:
Dividends from net investment income (0.09)
Distributions from net realized gains --
------
Total distributions (0.09)
------
Net asset value at end of period $9.93
======
Total return 0.99%(c)
======
Net assets at end of period (000's) $5,320
======
Ratio of expenses to average net assets (b) 0.50%(c)
Ratio of net investment income to average net assets 4.86%(c)
Portfolio turnover rate 97%
<FN>
(a) Represents the period from the commencement of operations (January 21,
1992) through March 31, 1992.
(b) Absent investment advisory fees waived and expenses reimbursed by the
Adviser, the ratios of expenses to average net assets would have been
0.94%, 0.85%, 0.85%, 0.81%, 0.82% and 0.81%(c) for the periods ended
March 31, 1997, 1996, 1995, 1994, 1993 and 1992, respectively.
(c) Annualized.
</FN>
</TABLE>
Further information about the performance of the Funds is contained in the
Annual Report, a copy of which may be obtained at no charge by calling the
Funds.
- 8 -
<PAGE>
INVESTMENT OBJECTIVES, INVESTMENT POLICIES
AND RISK CONSIDERATIONS
The investment objective of each Fund is to maximize total return, consisting of
current income and capital appreciation, both realized and unrealized, through
active management of a portfolio of investment grade fixed income securities.
Any investment involves risk, and there can be no assurance that the Funds will
achieve their investment objectives. The investment objective of each Fund may
not be altered without the prior approval of a majority (as defined by the
Investment Company Act of 1940) of the Fund's shares.
The Advisor's philosophy in the management of fixed income securities utilizes a
disciplined balance between sector selection and moderate portfolio duration
shifts to maximize total return. The Advisor's determination of optimal duration
for each Fund is based on economic indicators, inflation trends, credit demands,
monetary policy and global influences as well as psychological and technical
factors. The Funds endeavor to invest in securities and market sectors which the
Advisor believes are undervalued by the marketplace. The selection of
undervalued bonds by the Advisor is based on, among other things, historical
yield relationships, credit risk, market volatility and absolute levels of
interest rates, as well as supply and demand factors.
The Funds are designed primarily to allow institutional investors to take
advantage of the professional investment management expertise of Lowe,
Brockenbrough & Tattersall, Inc. Each Fund will be managed in a manner that
closely resembles that of other bond portfolios of similar maturity and duration
managed by the Advisor. The Advisor uses a wide variety of securities and
techniques in managing fixed income portfolios. As the fixed income markets
evolve, the Advisor may invest in other types of securities than those
specifically identified in this Prospectus if the Advisor views these
investments to be consistent with the overall investment objectives and policies
of the Funds. The securities and techniques the Advisor currently expects to
utilize are described below.
DURATION. Duration is an important concept in the Advisor's fixed income
management philosophy. "Duration" and "maturity" are different concepts and
should not be substituted for one another for purposes of understanding the
investment philosophy of either Fund. The Advisor believes that for most fixed
income securities "duration" provides a better measure of interest rate
sensitivity than maturity. Whereas maturity takes into account only the final
principal payments to determine the risk of a particular bond, duration weights
all potential cash flows (principal, interest and reinvestment income) on an
expected present value basis, to determine the "effective life" of the security.
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The Advisor intends to limit the portfolio duration of the Bond Fund to a 2 year
minimum and a 6 year maximum. The Advisor intends to maintain a portfolio
duration for the Short Term Fund of less than 3 years. In addition, the Advisor
intends to limit the duration of any one single security of the Short Term Fund
to a maximum duration of 5 years. The precise point of each Fund's duration
within these ranges will depend on the Advisor's view of the market. For the
purposes of the Funds, the duration calculation used is Macaulay duration
adjusted for option features (such as call features or prepayment options).
Adjusting for option features requires assumptions with respect to the
probability of that option being exercised. These assumptions will be determined
by the Advisor based on then current market conditions.
The Funds expect the average maturity of their portfolios to be longer than the
average duration. How much longer will depend upon, among other factors, the
composition of coupons (higher coupons imply shorter duration), as well as
overall interest rate levels (higher interest rates generally will result in
shorter duration relative to maturity). It should be noted that for some
securities the standard duration calculation does not accurately reflect
interest rate sensitivity. For example, mortgage pass-through securities,
Collateralized Mortgage Obligations and Asset Backed Securities require
estimates of principal prepayments which are critical in determining interest
rate sensitivity. Floating rate securities, because of the interest rate
adjustment feature, are not appropriate for the standard duration calculation.
In these and other similar situations, the Advisor will use more sophisticated
techniques to determine interest rate sensitivity of securities of the Funds.
INVESTMENT GRADE SECURITIES. Each Fund intends to limit its investment purchases
to investment grade securities. The Funds define investment grade securities as
those securities which, in the Advisor's opinion, have the characteristics
described by any of the nationally recognized statistical rating organizations
("NRSROs"), Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's
Ratings Group ("S&P"), Fitch Investors Service, Inc. ("Fitch") or Duff & Phelps
("D&P"), in their four highest rating grades. For S&P, Fitch and D&P those
ratings are AAA, AA, A and BBB. For Moody's those ratings are Aaa, Aa, A and
Baa. For a description of each rating grade, see the Statement of Additional
Information.
Each Fund invests exclusively in those securities rated investment grade by one
or more of the NRSROs or, if not rated, are considered by the Advisor to have
essentially the same characteristics and quality as securities having such
ratings. There may also be instances where the Advisor purchases securities
which are rated investment grade by one NRSRO and
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which are not rated or rated below investment grade by other NRSROs, and such
securities would be eligible for purchase by the Funds. Issues rated within the
fourth highest grade (those rated lower than A) are considered speculative in
certain respects and changes in economic conditions or other circumstances are
more likely to lead to a weakened capacity to pay principal and interest than is
the case with higher grade securities. The final determination of quality and
value will remain with the Advisor. Although the Advisor utilizes the ratings of
various credit rating services as one factor in establishing creditworthiness,
it relies primarily upon it own analysis of factors establishing
creditworthiness. For as long as the Funds hold a fixed income issue, the
Advisor monitors the issuer's credit standing. In the event a security's rating
is reduced below a Fund's minimum requirements, the Fund will sell the security,
subject to market conditions and the Advisor's assessment of the most opportune
time for sale. Although lower rated securities will generally provide higher
yields than higher rated securities of similar maturities, they are subject to a
greater degree of market fluctuation.
U.S. GOVERNMENT SECURITIES. U.S. Government Securities include direct
obligations of the U.S. Treasury, securities issued or guaranteed as to interest
and principal by agencies or instrumentalities of the U.S. Government, or any of
the foregoing subject to repurchase agreements (See "Repurchase Agreements.")
While obligations of some U.S. Government sponsored entities are supported by
the full faith and credit of the U.S. Government, several are supported by the
right of the issuer to borrow from the U.S. Government, and still others are
supported only by the credit of the issuer itself. The guarantee of the U.S.
Government does not extend to the yield or value of the U.S. Government
Securities held by the Funds or to either Fund's shares. See the Statement of
Additional Information for a more detailed description.
MORTGAGE PASS-THROUGH CERTIFICATES. Obligations of the Government National
Mortgage Association ("GNMA"), the Federal National Mortgage Association
("FNMA") and the Federal Home Loan Mortgage Corporation ("FHLMC") include direct
pass-through certificates representing undivided ownership interests in pools of
mortgages. Such certificates are guaranteed as to payment of principal and
interest (but not as to price and yield) by the issuer. In the case of
securities issued by GNMA, the payment of principal and interest would be backed
by the full faith and credit of the U.S. Government. Mortgage pass-through
certificates issued by FNMA or FHLMC would be guaranteed as to payment of
principal and interest by the credit of the issuing U.S. Government agency.
Securities issued by other non-governmental entities (such as commercial banks
or mortgage bankers) may offer credit enhancement such as guarantees,
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insurance, or letters of credit. Mortgage pass-through certificates are subject
to more rapid prepayment than their stated maturity date would indicate; their
rate of prepayment tends to accelerate during periods of declining interest
rates or increased property transfers and, as a result, the proceeds from such
prepayments may be reinvested in instruments which have lower yields. To the
extent such securities were purchased at a premium, such prepayments could
result in capital losses. The issuer of a pass-through mortgage certificate does
not guarantee premiums or market value of its issue.
COLLATERALIZED MORTGAGE OBLIGATIONS. The Funds intend to invest in
collateralized mortgage obligations ("CMOs") which are generally backed by
mortgage pass-through securities or whole mortgage loans. CMOs are usually
structured into classes of varying maturities and principal payment priorities.
The prepayment sensitivity of each class may or may not resemble that of the
CMOs' collateral depending on the maturity and structure of that class. CMOs pay
interest and principal (including prepayments) monthly, quarterly or
semiannually. Most CMOs are AAA rated, reflecting the credit quality of the
underlying collateral; however, some classes carry greater price risk than that
of their underlying collateral. The Advisor will invest in CMO classes only if
their characteristics and interest rate sensitivity fit the investment
objectives and policies of the individual Fund.
OTHER MORTGAGE RELATED SECURITIES. In addition to the mortgage pass-through
securities and the CMOs mentioned above, the Funds may also invest in other
mortgage derivative products if the Advisor views them to be consistent with the
overall policies and objectives of the Funds. Current offerings include
"principal only" (PO) and "interest only" (IO) Stripped Mortgage Backed
Securities ("SMBS"). POs and IOs are created when a mortgage pass-through
certificate is separated into two securities - one security representing a claim
to principal distributions and the other representing a claim to the
corresponding interest payments. As prepayments on the underlying mortgage loans
rise (typically when interest rates fall), the PO security holders receive their
principal sooner than expected, which serves to increase the POs' yield. The IO
security holders receive interest payments only on the outstanding principal
amount of the underlying mortgage loans. Therefore, if prepayments on the
notional principal of the IO rise, the IOs' price will fall. As POs generally
benefit from declining interest rates and IOs generally benefit from rising
interest rates, these securities can provide an effective way to stabilize
portfolio value.
SMBS are much more sensitive to prepayment fluctuations than are regular
mortgage-backed securities and therefore involve more risk. Due to the deep
discounted prices of SMBS, any mismatch in
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actual versus anticipated prepayments of principal will significantly increase
or decrease the yield to maturity. In general, changes in interest rate levels
will have the greatest effect on prepayments. Sufficiently high prepayment rates
could result in purchasers of IOs not recovering the full amount of their
initial investment. The Funds will not invest more than 10% of their total
assets in SMBS.
The Advisor expects that governmental, government related and private entities
may create other mortgage related securities offering mortgage pass-through and
mortgage collateralized instruments in addition to those described herein. As
new types of mortgage related securities are developed and offered to the
investment community, the Advisor will, consistent with the particular Fund's
investment objectives, policies and quality standards, consider making
investments in such new types of mortgage related securities.
ASSET BACKED SECURITIES. Other Asset Backed Securities have been offered to
investors backed by loans such as automobile loans, home equity loans, credit
card receivables, marine loans, recreational vehicle loans and manufactured
housing loans. Typically, Asset Backed Securities represent undivided fractional
interests in a fund whose assets consist of a pool of loans and security
interests in the collateral securing the loans. Payments of principal and
interest on Asset Backed Securities are passed through monthly to certificate
holders. In some cases Asset Backed Securities are divided into senior and
subordinated classes so as to enhance the quality of the senior class.
Underlying loans are subject to prepayment, which may reduce the overall return
to certificate holders. If the subordinated classes are exhausted and the full
amounts due on underlying loans are not received because of unanticipated costs,
depreciation, damage or loss of the collateral securing the contracts, or other
factors, certificate holders may experience delays in payment or losses on Asset
Backed Securities. The Funds may invest in other Asset Backed Securities that
may be developed in the future.
ZERO COUPON AND ORIGINAL ISSUE DISCOUNT ("OID") BONDS. Some securities may be
offered without coupons or with very low coupons. These bonds will typically be
more interest rate sensitive than a comparable maturity current coupon bond. The
majority of zero coupon bonds have been created when a qualified U.S. Government
Security is exchanged for a series of "Strips" through the Federal Reserve Bank.
Strips have been created from, among others, U.S. Treasury, Resolution Trust
Corporation and Financing Corporation securities. A number of U.S. Government
Securities have also been repackaged by broker-dealers or commercial banks into
trusts which issue zero coupon receipts such as U.S. Treasury Receipts ("TRs")
or Treasury Investment
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Growth Receipts ("TIGRs"). Zero coupon and original issue discount bonds
generate income under generally accepted accounting principles, but do not
generate cash flow, resulting in the possibility that the Funds may be required
to sell portfolio securities to make distributions as required under Subchapter
M of the Internal Revenue Code.
CORPORATE BONDS. The Funds' investments in corporate debt securities will be
based on credit analysis and value determination by the Advisor. The Advisor's
selection of bonds or industries within the corporate bond sector is determined
by, among other factors, historical yield relationships between bonds or
industries, the current and anticipated credit of the borrower, and call
features, as well as supply and demand factors.
VARIABLE AND FLOATING RATE SECURITIES. The Funds may invest in variable or
floating rate securities which adjust the interest rate paid at periodic
intervals based on an interest rate index. Typically floating rate securities
use as their benchmark an index such as the 1, 3 or 6 month LIBOR, 3, 6 or 12
month Treasury bills, or the Federal Funds rate. Resets of the rates can occur
at predetermined intervals or whenever changes in the benchmark index occur.
MONEY MARKET INSTRUMENTS. Money market instruments will typically represent a
portion of each Fund's portfolio, as funds awaiting investment, to accumulate
cash for anticipated purchases of portfolio securities and to provide for
shareholder redemptions and operational expenses of the Funds. Money market
instruments mature in thirteen months or less from the date of purchase and
include U.S. Government Securities (defined above) and corporate debt securities
(including those subject to repurchase agreements), bankers' acceptances and
certificates of deposit of domestic branches of U.S. banks, and commercial paper
(including variable amount demand master notes). At the time of purchase, money
market instruments will have a short-term rating in the highest category from
any NRSRO or, if not so rated, issued by a corporation having an outstanding
unsecured debt issue rated in the three highest categories of any NRSRO or, if
not so rated, of equivalent quality in the Advisor's opinion. See the Statement
of Additional Information for a further description of money market instruments.
INVESTMENT COMPANIES. The Bond Fund may invest in the securities of open-end and
closed-end investment companies which are generally authorized to invest in
securities eligible for purchase by the Fund. To the extent the Fund does so,
Fund shareholders would indirectly pay a portion of the operating costs of the
underlying investment companies. These costs include management, brokerage,
shareholder servicing and other
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operational expenses. Indirectly, then, shareholders may pay higher operational
costs than if they owned the underlying investment companies directly.
In addition, shares of closed-end investment companies frequently trade at a
discount from their net asset values. This characteristic of shares of a
closed-end investment company is a risk separate and distinct from the risk that
its net asset value will decrease.
The Bond Fund does not presently intend to invest more than 10% of its total
assets in securities of other investment companies. In addition, the Fund will
not invest more than 5% of its total assets in securities of any single
investment company, nor will it purchase more than 3% of the outstanding voting
securities of any investment company.
FACTORS TO CONSIDER. Neither Fund is intended to be a complete investment
program and there can be no assurance that the Funds will achieve their
investment objectives. The fixed income securities in which the Funds will
invest are subject to fluctuation in value. Such fluctuations may be based on
movements in interest rates or on changes in the creditworthiness of the
issuers, which may result from adverse business and economic developments or
proposed corporate transactions, such as a leveraged buy-out or recapitalization
of the issuer. The value of the Funds' fixed income securities will generally
vary inversely with the direction of prevailing interest rate movements.
Consequently, should interest rates increase or the creditworthiness of an
issuer deteriorate, the value of the Funds' fixed income securities would
decrease in value, which would have a depressing influence on the Funds' net
asset values. The Funds may borrow using their assets as collateral, but only
under certain limited conditions. Borrowing, if done, would tend to exaggerate
the effects of market fluctuations on a Fund's net asset value until repaid.
(See "Borrowing.")
SECURITIES LENDING. Each Fund may lend up to 33% of its portfolio securities to
broker-dealers or other institutional investors. Since there could be a delay in
the recovery of loaned securities or even a loss of rights in collateral
supplied should the borrower fail financially, loans will not be made unless, in
the judgment of the Advisor, the consideration to be earned from such loans
would justify the risk. Collateral will be maintained in excess of 100% of the
value of the underlying securities, determined by marking to market daily those
securities involved in the lending program. It is expected that the Funds will
use the cash portions of loan collateral to invest in short-term
income-producing securities. These practices may be amended from time to time as
regulatory provisions permit. Securities lending for purposes of discussion in
this Prospectus should not be confused with "Borrowing" below.
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BORROWING. Each Fund may borrow, temporarily, up to 5% of its total assets for
extraordinary purposes and may increase this limit to 15% of its total assets to
meet redemption requests which might otherwise require untimely disposition of
portfolio holdings. To the extent the Funds borrow for these purposes, the
effects of market price fluctuations on portfolio net asset value will be
exaggerated. If while such borrowing is in effect, the value of the particular
Fund's assets declines, the Fund would be forced to liquidate portfolio
securities when it is disadvantageous to do so. The Funds would incur interest
and other transaction costs in connection with such borrowing. A Fund will not
make any additional investments while its outstanding borrowings exceed 5% of
the current value of its total assets.
PORTFOLIO TURNOVER. Portfolio turnover will not be a limiting factor when the
Advisor deems changes appropriate. While portfolio turnover is difficult to
predict in an active fixed income portfolio, it is expected that annual
portfolio turnover will vary between 100% and 500% with respect to each Fund.
Market conditions may dictate, however, a higher rate of turnover in a
particular year. The degree of portfolio turnover affects the brokerage costs of
the Funds and may have an impact on the amount of taxable distributions to
shareholders. The portfolio turnover of the Bond Fund and of the Short Term Fund
for the fiscal year ended March 31, 1997 was 207% and 62%, respectively.
REPURCHASE AGREEMENTS. The Funds may acquire U.S. Government Securities or other
high-grade debt securities subject to repurchase agreements. A repurchase
agreement transaction occurs when the Funds acquire a security and
simultaneously resell it to the vendor (normally a member bank of the Federal
Reserve or a registered Government Securities dealer) for delivery on an agreed
upon future date. The repurchase price exceeds the purchase price by an amount
which reflects an agreed upon market interest rate earned by the Funds effective
for the period of time during which the repurchase agreement is in effect.
Delivery pursuant to the resale typically will occur within one to five days of
the purchase. For purposes of the Investment Company Act of 1940 (the "1940
Act"), a repurchase agreement is considered to be a loan collateralized by the
securities subject to the repurchase agreement. Neither Fund will enter into a
repurchase agreement which will cause more than 10% of its assets to be invested
in repurchase agreements which extend beyond seven days and other illiquid
securities.
INVESTMENT LIMITATIONS. For the purpose of limiting the Funds' exposure to
risk, each Fund has adopted certain limitations which, together with its
investment objective, are considered fundamental policies which may not be
changed without shareholder approval. Each Fund will not: (1) issue senior
securities,
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borrow money or pledge its assets, except that it may borrow from banks as a
temporary measure (a) for extraordinary or emergency purposes, in amounts not
exceeding 5% of either Fund's total assets, or (b) in order to meet redemption
requests which might otherwise require untimely disposition of portfolio
securities, in amounts not exceeding 15% of either Fund's total assets, and may
pledge its assets to secure all such borrowings; (2) invest more than 10% of a
Fund's assets in other illiquid securities, including repurchase agreements
maturing in over seven days, and other securities for which there is no
established market or for which market quotations are not readily available; (3)
write, acquire or sell puts, calls or combinations thereof, or purchase or sell
commodities, commodities contracts, futures contracts or related options; and
(4) invest more than 5% of its total assets in the securities of any one issuer.
Other fundamental investment limitations are listed in the Statement of
Additional Information.
HOW TO PURCHASE SHARES
There are NO FRONT-END OR CONTINGENT DEFERRED SALES COMMISSIONS CHARGED TO
INVESTORS. Assistance in opening accounts may be obtained from the Administrator
by calling 1-800-443-4249, or by writing to the Funds at the address shown below
for regular mail orders. Assistance is also available through any broker-dealer
authorized to sell shares of the Funds. Such broker-dealer may charge you a fee
for its services. Payment for shares purchased may be made through your account
at the broker-dealer processing your application and order to purchase. Your
investment will purchase shares at a Fund's net asset value next determined
after your order is received by the Funds in proper order as indicated herein.
Shares of the Funds purchased prior to July 31, 1997 are Institutional Shares.
The minimum initial investment in the Bond Fund is $500,000.
The minimum initial investment in the Short Term Fund is $100,000.
The Funds may, in the Advisor's sole discretion, accept certain accounts with
less than the stated minimum initial investment.
Payment must be made by check or money order drawn on a U.S. bank and payable in
U.S. dollars. All orders received by the Administrator, whether by mail, bank
wire or facsimile order from a qualified broker-dealer, prior to 4:00 p.m.,
Eastern time, will purchase shares at the net asset value next determined on
that business day. If your order is not received by 4:00 p.m. Eastern time, your
order will purchase shares at the net asset value determined on the next
business day. (See "How Net Asset Value is Determined.")
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Due to Internal Revenue Service ("IRS") regulations, applications without social
security or tax identification numbers will not be accepted. If, however, you
have already applied for a social security or tax identification number at the
time of completing your account application, the application should so indicate.
The Funds are required to, and will, withhold taxes on all distributions and
redemption proceeds if the number is not delivered to the Funds within 60 days.
Investors should be aware that the Funds' account application contains
provisions in favor of the Funds, the Administrator and certain of their
affiliates, excluding such entities from certain liabilities (including, among
others, losses resulting from unauthorized shareholder transactions) relating to
the various services made available to investors.
Should an order to purchase shares be cancelled because your check does not
clear, you will be responsible for any resulting losses or fees incurred by the
Funds or the Administrator in the transaction.
REGULAR MAIL ORDERS. Please complete and sign the Account Application form
accompanying this Prospectus and send it with your check, made payable to the
appropriate Fund, and mail it to:
THE JAMESTOWN BOND FUNDS
C/O SHAREHOLDER SERVICES
P.O. BOX 5354
CINCINNATI, OHIO 45201-5354
BANK WIRE ORDERS. Investments can be made directly by bank wire. To establish a
new account or add to an existing account by wire, please call the Funds, at
1-800-443-4249, before wiring funds, to advise the Funds of the investment, the
dollar amount and the account registration. This will ensure prompt and accurate
handling of your investment. Please have your bank use the following wiring
instructions to purchase by wire:
Star Bank, N.A.
Cincinnati Trust
ABA# 042000013
For Williamsburg Investment Trust #485777056
For either: The Jamestown Bond Fund or
The Jamestown Short Term Bond Fund
(Shareholder name and account number)
It is important that the wire contain all the information and that the Funds
receive prior telephone notification to ensure proper credit. Once your wire is
sent you should, as soon as possible thereafter, complete and mail your Account
Application to the Funds as described under "Regular Mail Orders," above.
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ADDITIONAL INVESTMENTS. You may add to your account by mail or wire (minimum
additional investment of $1,000) at any time by purchasing shares at the then
current net asset value as aforementioned. Before making additional investments
by bank wire, please call the Funds at 1-800-443-4249 to alert the Funds that
your wire is to be sent. Follow the wire instructions above to send your wire.
When calling for any reason, please have your account number ready, if known.
Mail orders should include, when possible, the "Invest by Mail" stub which is
attached to your Fund confirmation statement. Otherwise, be sure to identify
your account in your letter.
EXCHANGE PRIVILEGE. You may use proceeds from the redemption of shares of either
Fund to purchase Consultant Shares of the other Fund offering shares for sale in
your state of residence. There is no charge for this exchange privilege. Before
making an exchange, you should read the portion of the Prospectus relating to
the Fund into which the shares are to be exchanged. The shares of the Fund to be
acquired will be purchased at the net asset value next determined after
acceptance of the exchange request in writing by the Administrator. The exchange
of shares of one Fund for shares of the other Fund is treated, for federal
income tax purposes, as a sale on which you may realize taxable gain or loss. To
prevent the abuse of the exchange privilege to the disadvantage of other
shareholders, each Fund reserves the right to terminate or modify the exchange
offer upon 60 days' notice to shareholders.
STOCK CERTIFICATES. Stock certificates will not be issued for your shares.
Evidence of ownership will be given by issuance of periodic account statements
which will show the number of shares owned.
HOW TO REDEEM SHARES
Shares of the Funds may be redeemed on each day that the Funds are open for
business by sending a written request to the Funds. The Funds are open for
business on each day the New York Stock Exchange (the "Exchange") is open for
business. Any redemption may be for more or less than the purchase price of your
shares depending on the market value of the Funds' portfolio securities. All
redemption orders received in proper form, as indicated herein, by the
Administrator prior to 4:00 p.m. Eastern time will redeem shares at the net
asset value determined as of that business day's close of trading. Otherwise,
your order will redeem shares on the next business day. You may also redeem your
shares through a broker-dealer who may charge you a fee for its services.
The Board of Trustees reserves the right to involuntarily redeem any account
having an account value of less than $100,000 (due to
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redemptions, exchanges or transfers, and not due to market action) upon 60 days'
written notice. If the shareholder brings his account value up to $100,000 or
more during the notice period, the account will not be redeemed. Redemptions
from retirement plans may be subject to tax withholding.
If you are uncertain of the requirements for redemption, please contact the
Funds, at 1-800-443-4249, or write to the address shown below.
REGULAR MAIL REDEMPTIONS. Your request should be addressed to
The Jamestown Bond Funds, P.O. Box 5354, Cincinnati, Ohio 45201-
5354. Your request for redemption must include:
1) your letter of instruction or a stock assignment specifying
the Bond Fund or the Short Term Fund, the account number, and
the number of shares or dollar amount to be redeemed. This
request must be signed by all registered shareholders in the
exact names in which they are registered;
2) any required signature guarantees (see "Signature
Guarantees"); and
3) other supporting legal documents, if required in the case of
estates, trusts, guardianships, custodianships, corporations,
partnerships, pension or profit sharing plans, and other
organizations.
Your redemption proceeds will be mailed to you within three business days after
receipt of your redemption request. However, a Fund may delay forwarding a
redemption check for recently purchased shares while it determines whether the
purchase payment will be honored. Such delay (which may take up to 15 days) may
be reduced or avoided if the purchase is made by certified check, government
check or wire transfer. In such cases, the net asset value next determined after
receipt of the request for redemption will be used in processing the redemption
and your redemption proceeds will be mailed to you upon clearance of your check
to purchase shares. The Funds may suspend redemption privileges or postpone the
date of payment (i) during any period that the Exchange is closed, or trading on
the Exchange is restricted as determined by the Securities and Exchange
Commission (the "Commission"), (ii) during any period when an emergency exists
as defined by the rules of the Commission as a result of which it is not
reasonably practicable for the Funds to dispose of securities owned by them, or
to fairly determine the value of their assets, and (iii) for such other periods
as the Commission may permit.
You can choose to have redemption proceeds mailed to you at your address of
record, your bank, or to any other authorized person, or you can have the
proceeds sent by bank wire to your bank ($5,000 minimum). Shares of the Funds
may not be redeemed by wire on days in which your bank is not open for business.
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Redemption proceeds will only be sent to the bank account or person named
in your Account Application currently on file with the Funds. You can change
your redemption instructions anytime you wish by filing a letter including your
new redemption instructions with the Funds. (See "Signature Guarantees.")
There is currently no charge by the Administrator for wire redemptions. However,
the Administrator reserves the right, upon thirty days' written notice, to make
reasonable charges for wire redemptions. All charges will be deducted from your
account by redemption of shares in your account. Your bank or brokerage firm may
also impose a charge for processing the wire. In the event that wire transfer of
funds is impossible or impractical, the redemption proceeds will be sent by mail
to the designated account.
SIGNATURE GUARANTEES. To protect your account and the Funds from fraud,
signature guarantees are required to be sure that you are the person who has
authorized a change in registration, or standing instructions, for your account.
Signature guarantees are required for (1) change of registration requests, and
(2) requests to establish or change redemption services other than through your
initial account application. Signature guarantees are acceptable from a member
bank of the Federal Reserve System, a savings and loan institution, credit
union, registered broker-dealer or a member firm of a U.S. Stock Exchange, and
must appear on the written request for redemption, or change of registration.
HOW NET ASSET VALUE IS DETERMINED
The net asset value of each Fund is determined on each business day that the
Exchange is open for trading, as of the close of the Exchange (currently 4:00
p.m., Eastern time). Net asset value per share is determined by dividing the
total value of all Fund securities (valued at market value) and other assets,
less liabilities, by the total number of shares then outstanding. Net asset
value includes interest on fixed income securities, which is accrued daily. See
the Statement of Additional Information for further details.
Securities which are traded over-the-counter are priced at the last sale price,
if available, otherwise, at the last quoted bid price. Securities traded on a
national exchange will be valued based upon the closing price on the valuation
date on the principal exchange where the security is traded. It is expected that
fixed income securities will ordinarily be traded in the over-the-counter
market. When market quotations are not readily available, fixed income
securities may be valued on the basis of prices provided by an independent
pricing service. The prices provided by the pricing service are determined with
consideration given to institutional bid and last sale prices and take into
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<PAGE>
account securities prices, yields, maturities, call features, ratings,
institutional trading in similar groups of securities and developments related
to specific securities. The Trustees will satisfy themselves that such pricing
services consider all appropriate factors relevant to the value of such
securities in determining their fair value. Securities and other assets for
which no quotations are readily available will be valued in good faith at fair
value using methods determined by the Board of Trustees.
MANAGEMENT OF THE FUNDS
The Funds are diversified series of the Williamsburg Investment Trust (the
"Trust"), an investment company organized as a Massachusetts business trust in
July 1988, which was formerly known as The Nottingham Investment Trust. The
Board of Trustees has overall responsibility for management of the Funds under
the laws of Massachusetts governing the responsibilities of trustees of business
trusts. The Statement of Additional Information identifies the Trustees and
officers of the Trust and the Funds and provides information about them.
INVESTMENT ADVISOR. Subject to the authority of the Board of Trustees, Lowe,
Brockenbrough & Tattersall Strategic Advisors, Inc. (the "Advisor") provides the
Funds with a continuous program of supervision of each Fund's assets, including
the composition of its portfolio, and furnishes advice and recommendations with
respect to investments, investment policies and the purchase and sale of
securities, pursuant to Investment Advisory Agreements with the Trust. The
Advisor is also responsible for the selection of broker-dealers through which
the Funds execute portfolio transactions, subject to brokerage policies
established by the Trustees, and provides certain executive personnel to the
Funds.
The Advisor is a Virginia corporation controlled by Fred T. Tattersall. Prior to
February 28, 1997, the investment advisor to each Fund was Lowe, Brockenbrough &
Tattersall, Inc. ("LB&T"), of which Mr. Tattersall and Austin Brockenbrough III
were the controlling shareholders. On February 28, 1997, LB&T was reorganized by
means of a corporate restructuring into two separate legal entities: LB&T, owned
by Mr. Brockenbrough, and the Advisor, owned by Mr. Tattersall. The Advisor
manages the fixed-income accounts (including the Funds) formerly managed by
LB&T. In addition to acting as Advisor to the Funds, the Advisor provides
investment advice to corporations, trusts, pension and profit sharing plans,
other business and institutional accounts and individuals. The Advisor also
serves as sub-advisor to The Jamestown Balanced Fund (another series of the
Trust), the subject of a separate prospectus.
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<PAGE>
Both the Bond Fund and the Short Term Fund are managed on a day to day basis by
a committee comprised of the Advisor's fixed income portfolio management
professionals, with each portfolio professional responsible for designated
specific sectors of the fixed income market. Prior to February 28, 1997, the
Funds were managed by the same group of professionals, but such professionals
were employed by LB&T.
Compensation of the Advisor is at the annual rate of 0.375% of each Fund's
average daily net assets. For the fiscal year ended March 31, 1997, the Advisor
and LB&T received $289,094 in investment advisory fees from the Bond Fund, which
represented 0.375% of the Bond Fund's average daily net assets. For the fiscal
year ended March 31, 1997, the Advisor and LB&T each waived its entire
investment advisory fee from the Short Term Fund and reimbursed the Fund for
$6,864 of other operating expenses.
The Advisor currently intends to waive its investment advisory fees to the
extent necessary to limit the total operating expenses of Consultant Shares of
the Short Term Fund to 0.65% per annum of its average daily net assets. However,
there is no assurance that any voluntary fee waivers will continue in the
current or future fiscal years, and expenses of Consultant Shares of the Short
Term Fund may therefore exceed 0.65% of its average daily net assets.
The Advisor's address is 6620 West Broad Street, Suite 300, Richmond, Virginia
23230.
ADMINISTRATOR. The Funds have retained Countrywide Fund Services, Inc. (the
"Administrator"), P.O. Box 5354, Cincinnati, Ohio 45201, to provide
administrative, pricing, accounting, dividend disbursing, shareholder servicing
and transfer agent services. The Administrator is a wholly-owned indirect
subsidiary of Countrywide Credit Industries, Inc., a New York Stock Exchange
listed company principally engaged in the business of residential mortgage
lending.
The Administrator supplies executive, administrative and regulatory services,
supervises the preparation of tax returns, and coordinates the preparation of
reports to shareholders and reports to and filings with the Securities and
Exchange Commission and state securities authorities. In addition, the
Administrator calculates daily net asset value per share and maintains such
books and records as are necessary to enable it to perform its duties.
Each Fund pays the Administrator a base fee for these services at the annual
rate of 0.075% of the average value of its daily net assets up to $200 million
and 0.05% of such assets in excess of
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<PAGE>
$200 million (subject to a minimum fee of $2,000 per month with respect to each
Fund) plus a surcharge of $1,000 per month. The Administrator also charges the
Funds for certain costs involved with the daily valuation of investment
securities and is reimbursed for out-of-pocket expenses.
CUSTODIAN. The Custodian of the Funds' assets is Star Bank, N.A.
(the "Custodian"). The Custodian's mailing address is 425 Walnut
Street, Cincinnati, Ohio 45202. The Advisor, Administrator or
interested persons thereof may have banking relationships with
the Custodian.
OTHER FUND COSTS. The Funds pay all expenses not assumed by the Advisor,
including its fees. Fund expenses include, among others, the fees and expenses,
if any, of the Trustees and officers who are not "affiliated persons" of the
Advisor, fees of the Funds' Custodian, interest expense, taxes, brokerage fees
and commissions, fees and expenses of the Funds' shareholder servicing
operations, fees and expenses of qualifying and registering the Funds' shares
under federal and state securities laws, expenses of preparing, printing and
distributing prospectuses and reports to existing shareholders, auditing and
legal expenses, insurance expenses, association dues, and the expense of
shareholders' meetings and proxy solicitations. The Funds are also liable for
any nonrecurring expenses that may arise such as litigation to which the Funds
may be a party. The Funds may be obligated to indemnify the Trustees and
officers with respect to such litigation. All expenses of a Fund are accrued
daily on the books of such Fund at a rate which, to the best of its belief, is
equal to the actual expenses expected to be incurred by the Fund in accordance
with generally accepted accounting practices.
BROKERAGE. The Funds have adopted brokerage policies which allow the Advisor to
prefer brokers which provide research or other valuable services to the Advisor
and/or the Funds. In all cases, the primary consideration for selection of
broker-dealers through which to execute brokerage transactions will be to obtain
the most favorable price and execution for the Funds. Research services obtained
through the Funds' brokerage transactions may be used by the Advisor for its
other clients; conversely, the Funds may benefit from research services obtained
through the brokerage transactions of the Advisor's other clients. The Statement
of Additional Information contains more information about the management and
brokerage practices of the Funds. It is anticipated that most securities
transactions of the Funds will be handled on a principal, rather than agency,
basis. Fixed income securities are normally traded on a net basis (without
commission) through broker-dealers and banks acting for their own account. Such
firms attempt to profit from buying at the bid price and selling at the higher
asked price of the market, the difference being referred to as the spread.
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<PAGE>
PLAN OF DISTRIBUTION
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, Consultant
Shares of the Fund have adopted a plan of distribution (the "Plan") under which
such shares may directly incur or reimburse the Advisor for certain
distribution-related expenses, including payments to securities dealers and
others who are engaged in the sale of such shares and who may be advising
investors regarding the purchase, sale or retention of such shares; expenses of
maintaining personnel who engage in or support distribution of shares or who
render shareholder support services not otherwise provided by the Transfer
Agent; expenses of formulating and implementing marketing and promotional
activities, including direct mail promotions and mass media advertising;
expenses of preparing, printing and distributing sales literature and
prospectuses and statements of additional information and reports for recipients
other than existing shareholders of the Funds; expenses of obtaining such
information, analyses and reports with respect to marketing and promotional
activities as the Trust may, from time to time, deem advisable; and any other
expenses related to the distribution of such shares.
The annual limitation for payment of expenses pursuant to the Plan is .15% of
the average daily net assets allocable to Consultant Shares. Unreimbursed
expenditures will not be carried over from year to year. In the event the Plan
is terminated by the Funds in accordance with its terms, the Funds will not be
required to make any payments for expenses incurred by the Advisor after the
date the Plan terminates.
Pursuant to the Plan, the Funds may also make payments to banks or other
financial institutions that provide shareholder services and administer
shareholder accounts. The Glass-Steagall Act prohibits banks from engaging in
the business of underwriting, selling or distributing securities. Although the
scope of this prohibition under the Glass-Steagall Act has not been clearly
defined by the courts or appropriate regulatory agencies, management of the
Trust believes that the Glass-Steagall Act should not preclude a bank from
providing such services. However, state securities laws on this issue may differ
from the interpretations of federal law expressed herein and banks and financial
institutions may be required to register dealers pursuant to state law. If a
bank were prohibited from continuing to perform all or a part of such services,
management of the Trust believes that there would be no material impact on the
Funds or their shareholders. Banks may charge their customers fees for offering
these services to the extent permitted by regulatory authorities, and the
overall return to those shareholders availing themselves of bank services will
be lower than to those shareholders who do not. The Funds may from time
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<PAGE>
to time purchase securities issued by banks which provide such services;
however, in selecting investments for the Funds, no preference will be shown for
such securities.
DIVIDENDS, DISTRIBUTIONS, TAXES AND OTHER INFORMATION
The Statement of Additional Information contains additional information about
the federal income tax implications of an investment in the Funds in general
and, particularly, with respect to dividends and distributions and other
matters. Shareholders should be aware that dividends from the Funds which are
derived in whole or in part from interest on U.S. Government Securities may not
be taxable for state income tax purposes. Other state income tax implications
are not covered, nor is this discussion exhaustive on the subject of federal
income taxation. Consequently, investors should seek qualified tax advice.
Each Fund intends to remain qualified as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986 (the "Code") and will
distribute all of its net income and realized capital gains to shareholders.
Shareholders are liable for taxes on distributions of net income and realized
capital gains of the Funds but, of course, shareholders who are not subject to
tax on their income will not be required to pay taxes on amounts distributed to
them. The Funds intend to declare dividends quarterly, payable in March, June,
September and December, on a date selected by the Trustees. In addition,
distributions may be made annually in December out of any net short-term or
long-term capital gains derived from the sale of securities realized through
October 31 of that year. Each Fund may make a supplemental distribution of
capital gains at the end of its fiscal year. The nature and amount of all
dividends and distributions will be identified separately when tax information
is distributed by the Funds at the end of each year. The Funds intend to
withhold 30% on taxable dividends and any other payments that are subject to
such withholding and are neither citizens nor residents of the U.S.
There is no fixed dividend rate, and there can be no assurance as to the payment
of any dividends or the realization of any gains for either Fund. Current
practice of the Funds, subject to the discretion of the Board of Trustees, is
for declaration and payment of income dividends during the last week of each
calendar quarter. All dividends and capital gains distributions are reinvested
in additional shares of the Funds unless the shareholder requests in writing to
receive dividends and/or capital gains distributions in cash. That request must
be received by the Funds prior to the record date to be effective as to the next
dividend. Tax consequences to shareholders of dividends and distributions are
the same if received in cash or if received in additional shares of the Funds.
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<PAGE>
TAX STATUS OF THE FUNDS. If a Fund is qualified as a "regulated investment
company" under the Code, it will not be liable for federal income taxes on
amounts paid as dividends and distributions. The Code contains a number of
complex requirements which an investment company must meet in order to qualify.
For a more detailed discussion of the tax status of the Funds, see "Additional
Tax Information" in the Statement of Additional Information.
PRINCIPAL SHAREHOLDERS. Rockingham Health Care, Inc., 235 Cantrell Avenue,
Harrisonburg, Virginia, owned of record 54.4% of the Short Term Fund's
outstanding shares as of May 23, 1997 and may be deemed to control the Fund.
DESCRIPTION OF FUND SHARES AND OTHER MATTERS. The Declaration of Trust of the
Williamsburg Investment Trust currently provides for the shares of eleven funds,
or series, to be issued. Shares of all eleven series have currently been issued,
in addition to the Bond Fund and the Short Term Fund described in this
Prospectus: shares of the FBP Contrarian Balanced Fund and the FBP Contrarian
Equity Fund, which are managed by Flippin, Bruce & Porter, Inc. of Lynchburg,
Virginia; shares of The Government Street Equity Fund, The Government Street
Bond Fund and The Alabama Tax Free Bond Fund, which are managed by T. Leavell &
Associates, Inc. of Mobile, Alabama; and shares of The Jamestown Balanced Fund,
The Jamestown Equity Fund, The Jamestown International Equity Fund and The
Jamestown Tax Exempt Virginia Fund, which are managed by Lowe, Brockenbrough &
Tattersall, Inc. The Trustees are permitted to create additional series at any
time.
Shares are freely transferable, have no preemptive or conversion rights and,
when issued, are fully paid and non-assessable. Upon liquidation of the Trust or
a particular Fund of the Trust, holders of the outstanding shares of the Fund
being liquidated shall be entitled to receive, in proportion to the number of
shares of the Fund held by them, the excess of that Fund's assets over its
liabilities. Each outstanding share is entitled to one vote for each full share
and a fractional vote for each fractional share, on all matters which concern
the Trust as a whole. On any matter submitted to a vote of shareholders, all
shares of the Trust then issued and outstanding and entitled to vote,
irrespective of the Fund, shall be voted in the aggregate and not by Fund,
except (i) when required by the 1940 Act, shares shall be voted by individual
Fund; and (ii) when the matter does not affect any interest of a particular
Fund, then only shareholders of the affected Fund or Funds shall be entitled to
vote thereon. Examples of matters which affect only a particular Fund could be a
proposed change in the fundamental investment objectives or policies of that
Fund or a proposed change in the investment advisory agreement for a particular
Fund. Consultant Shares of the Funds shall vote separately on matters relating
to
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<PAGE>
the plan of distribution pursuant to Rule 12b-1 (see "Plan of Distribution").
The shares of the Funds have noncumulative voting rights, which means that the
holders of more than 50% of the shares voting for the election of Trustees can
elect all of the Trustees if they so choose.
The Declaration of Trust provides that the Trustees may hold office
indefinitely, except that: (1) any Trustee may resign or retire; and (2) any
Trustee may be removed with or without cause at any time: (a) by a written
instrument, signed by at least two-thirds of the number of Trustees prior to
such removal; (b) by vote of shareholders holding not less than two-thirds of
the outstanding shares of the Trust, cast in person or by proxy at a meeting
called for that purpose; or (c) by a written declaration signed by shareholders
holding not less than two-thirds of the outstanding shares of the Trust and
filed with the Trust's custodian. In case a vacancy or an anticipated vacancy
shall for any reason exist, the vacancy shall be filled by the affirmative vote
of a majority of the remaining Trustees, subject to the provisions of Section
16(a) of the 1940 Act.
Any group of shareholders representing 10% or more of the shares then
outstanding may call a meeting for the purpose of removing one or more of the
Trustees. If shareholders desire to call a meeting to consider the removal of
one or more Trustees, they will be assisted in communicating with other
shareholders. See the Statement of Additional Information for more information.
Shareholder inquiries may be made in writing, addressed to the Funds at the
address shown on the cover.
Under Massachusetts law, shareholders of a business trust may, under certain
circumstances, be held personally liable as partners for the obligations of the
Trust. The Declaration of Trust, therefore, contains provisions which are
intended to mitigate such liability. See the Statement of Additional Information
for further information about the Trust and its shares.
CALCULATION OF PERFORMANCE DATA. From time to time each Fund may advertise its
total return. Each Fund may also advertise yield. Both yield and total return
figures are based on historical earnings and are not intended to indicate future
performance. Total return and yield are computed separately for Consultant and
Institutional Shares. The yield of Institutional Shares is expected to be higher
than the yield of Consultant Shares due to the distribution fees imposed on
Consultant Shares.
The "total return" of a Fund refers to the average annual compounded rates of
return over 1, 5 and 10 year periods that would equate an initial amount
invested at the beginning of a stated period to the ending redeemable value of
the investment.
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<PAGE>
The calculation of total return assumes the reinvestment of all dividends and
distributions, includes all recurring fees that are charged to all shareholder
accounts and deducts all nonrecurring charges at the end of each period. If a
Fund has been operating less than 1, 5 or 10 years, the time period during which
the Fund has been operating is substituted.
In addition, the Funds may advertise other total return performance data
("Nonstandardized Return"). Nonstandardized Return shows as a percentage rate of
return encompassing all elements of return (i.e., income and capital
appreciation or depreciation); it assumes reinvestment of all dividends and
capital gain distributions. Nonstandardized Return may be quoted for the same or
different periods as those for which standardized return is quoted.
Nonstandardized Return may consist of a cumulative percentage rate of return,
actual year-by-year rates or any combination thereof.
The "yield" of a Fund is computed by dividing the net investment income per
share earned during a thirty-day (or one month) period stated in the
advertisement by the maximum offering price per share on the last day of the
period (using the average number of shares entitled to receive dividends). The
yield formula assumes that net investment income is earned and reinvested at a
constant rate and annualized at the end of a six-month period. For the purpose
of determining net investment income, the calculation includes among expenses of
the Funds all recurring fees that are charged to all shareholder accounts and
any nonrecurring charges for the period stated.
<PAGE>
THE JAMESTOWN BOND FUNDS
INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall Strategic Advisors, Inc.
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
ADMINISTRATOR
Countrywide Fund Services, Inc.
312 Walnut Street
P.O. Box 5354
Cincinnati, Ohio 45201-5354
1-800-443-4249
CUSTODIAN
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT AUDITORS
Tait, Weller & Baker
Two Penn Center Plaza
Philadelphia, Pennsylvania 19102
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard Mitchell
Richard L. Morrill
Harris V. Morrissette
Fred T. Tattersall
Erwin H. Will, Jr.
Samuel B. Witt III
OFFICERS
Fred T. Tattersall, President
Craig D. Truitt, Vice President
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering contained in this Prospectus, and if given or made, such
information or representations must not be relied upon as being authorized by
the Funds. This Prospectus does not constitute an offer by the Funds to sell
shares in any State to any person to whom it is unlawful for the Funds to make
such offer in such State.
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<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
THE JAMESTOWN BOND FUNDS
The Jamestown Bond Fund
The Jamestown Short Term Bond Fund
July 31, 1997
Series of
WILLIAMSBURG INVESTMENT TRUST
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202
Telephone 1-800-443-4249
TABLE OF CONTENTS
INVESTMENT OBJECTIVES AND POLICIES.....................................2
DESCRIPTION OF BOND RATINGS............................................5
INVESTMENT LIMITATIONS.................................................8
TRUSTEES AND OFFICERS.................................................10
INVESTMENT ADVISOR....................................................14
ADMINISTRATOR.........................................................15
OTHER SERVICES........................................................16
BROKERAGE.............................................................16
SPECIAL SHAREHOLDER SERVICES..........................................17
PLAN OF DISTRIBUTION..................................................19
PURCHASE OF SHARES....................................................20
REDEMPTION OF SHARES..................................................21
NET ASSET VALUE DETERMINATION.........................................21
ALLOCATION OF TRUST EXPENSES..........................................21
ADDITIONAL TAX INFORMATION............................................22
CAPITAL SHARES AND VOTING.............................................23
CALCULATION OF PERFORMANCE DATA.......................................24
FINANCIAL STATEMENTS AND REPORTS......................................27
This Statement of Additional Information is not a prospectus and should only be
read in conjunction with the Prospectus of The Jamestown Bond Funds (the
"Funds") dated July 31, 1997. The Prospectus may be obtained from the Funds, at
the address and phone number shown above, at no charge.
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES
All information contained herein applies to both The Jamestown Bond Fund (the
"Bond Fund") and The Jamestown Short Term Bond Fund (the "Short Term Fund")
unless otherwise noted.
The investment objectives and policies of the Funds are described in the
Prospectus. Supplemental information about these policies is set forth below.
Certain capitalized terms used herein are defined in the Prospectus.
REPURCHASE AGREEMENTS. The Funds may acquire U.S. Government Securities subject
to repurchase agreements. A repurchase transaction occurs when, at the time a
Fund purchases a security (normally a U.S. Treasury obligation), it also resells
it to the vendor (normally a member bank of the Federal Reserve System or a
registered Government Securities dealer) and must deliver the security (and/or
securities substituted for them under the repurchase agreement) to the vendor on
an agreed upon date in the future. Such securities, including any securities so
substituted, are referred to as the "Repurchase Securities." The repurchase
price exceeds the purchase price by an amount which reflects an agreed upon
market interest rate effective for the period of time during which the
repurchase agreement is in effect.
The majority of these transactions run day to day and the delivery pursuant to
the resale typically will occur within one to five days of the purchase. The
Funds' risk is limited to the ability of the vendor to pay the agreed upon sum
upon the delivery date; in the event of bankruptcy or other default by the
vendor, there may be possible delays and expenses in liquidating the instrument
purchased, decline in its value and loss of interest. These risks are minimized
when the Funds hold a perfected security interest in the Repurchase Securities
and can therefore sell the instrument promptly. Under guidelines issued by the
Trustees, the Advisor will carefully consider the creditworthiness during the
term of the repurchase agreement. Repurchase agreements are considered as loans
collateralized by the Repurchase Securities, such agreements being defined as
"loans" under the Investment Company Act of 1940 (the "1940 Act"). The return on
such "collateral" may be more or less than that from the repurchase agreement.
The market value of the resold securities will be monitored so that the value of
the "collateral" is at all times as least equal to the value of the loan,
including the accrued interest earned thereon. All Repurchase Securities will be
held by the Funds' custodian either directly or through a securities depository.
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<PAGE>
SECURITIES OF UNSEASONED COMPANIES. The securities of unseasoned companies
(those in business less than three years, including predecessors and, in the
case of bonds, guarantors) may have a limited trading market, which may
adversely affect disposition. If other investors attempt to dispose of such
holdings when the Funds desire to do so, the Funds could receive lower prices
than might otherwise be obtained. Because of the increased risk over larger,
better known companies, each Fund limits its investments in the securities of
unseasoned issuers to no more than 5% of its total assets.
U.S. GOVERNMENT SECURITIES. Each Fund may invest in debt obligations which are
issued or guaranteed by the U.S. Government, its agencies and instrumentalities
("U.S. Government Securities") as described herein. U.S. Government Securities
include the following securities: (1) U.S. Treasury obligations of various
interest rates, maturities and issue dates, such as U.S. Treasury bills (mature
in one year or less), U.S. Treasury notes (mature in one to seven years), and
U.S. Treasury bonds (mature in more than seven years), the payments of principal
and interest of which are all backed by the full faith and credit of the U.S.
Government; (2) obligations issued or guaranteed by U.S. Government agencies or
instrumentalities, some of which are backed by the full faith and credit of the
U.S. Government, e.g., obligations of the Government National Mortgage
Association ("GNMA"), the Farmers Home Administration and the Export Import
Bank; some of which do not carry the full faith and credit of the U.S.
Government but which are supported by the right of the issuer to borrow from the
U.S. Government, e.g., obligations of the Tennessee Valley Authority, the U.S.
Postal Service, the Federal National Mortgage Association ("FNMA"), and the
Federal Home Loan Mortgage Corporation ("FHLMC"); and some of which are backed
only by the credit of the issuer itself, e.g., obligations of the Student Loan
Marketing Association, the Federal Home Loan Banks and the Federal Farm Credit
Bank; and (3) any of the foregoing purchased subject to repurchase agreements as
described herein. The Funds do not intend to invest in "zero coupon" Treasury
securities. The guarantee of the U.S. Government does not extend to the yield or
value of the Funds' shares.
Obligations of GNMA, FNMA and FHLMC may include direct pass-through
"Certificates," representing undivided ownership interests in pools of
mortgages. Such Certificates are guaranteed as to payment of principal and
interest (but not as to price and yield) by the U.S. Government or the issuing
agency. Mortgage Certificates are subject to more rapid prepayment than their
stated maturity date would indicate; their rate of prepayment tends to
accelerate during periods of declining interest rates and, as a result, the
proceeds from such prepayments may be reinvested in instruments which have lower
yields. To the extent such securities were purchased at a
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<PAGE>
premium, such prepayments could result in capital losses. The
U.S. Government does not guarantee premiums and market value of
U.S. Government Securities.
DESCRIPTION OF MONEY MARKET INSTRUMENTS. Money market instruments may include
U.S. Government Securities or corporate debt obligations (including those
subject to repurchase agreements) as described herein, provided that they mature
in thirteen months or less from the date of acquisition and are otherwise
eligible for purchase by the Funds. Money market instruments also may include
Bankers' Acceptances and Certificates of Deposit of domestic branches of U.S.
banks, Commercial Paper and Variable Amount Demand Master Notes ("Master
Notes"). BANKERS' ACCEPTANCES are time drafts drawn on and "accepted" by a bank,
are the customary means of effecting payment for merchandise sold in
import-export transactions and are a source of financing used extensively in
international trade. When a bank "accepts" such a time draft, it assumes
liability for its payment. When the Funds acquire a Bankers' Acceptance, the
bank which "accepted" the time draft is liable for payment of interest and
principal when due. The Bankers' Acceptance, therefore, carries the full faith
and credit of such bank. A CERTIFICATE OF DEPOSIT ("CD") is an unsecured
interest-bearing debt obligation of a bank. CDs acquired by the Funds would
generally be in amounts of $100,000 or more. COMMERCIAL PAPER is an unsecured,
short-term debt obligation of a bank, corporation or other borrower. Commercial
Paper maturity generally ranges from two to 270 days and is usually sold on a
discounted basis rather than as an interest-bearing instrument. The Funds will
invest in Commercial Paper only if it is rated in the highest rating category by
any nationally recognized statistical rating organization ("NRSRO") or, if not
rated, the issuer must have an outstanding unsecured debt issue rated in the
three highest categories by any NRSRO or, if not so rated, be of equivalent
quality in the Advisor's assessment. Commercial Paper may include Master Notes
of the same quality. MASTER NOTES are unsecured obligations which are redeemable
upon demand of the holder and which permit the investment of fluctuating amounts
at varying rates of interest. Master Notes are acquired by the Funds only
through the Master Note program of the Funds' custodian, acting as administrator
thereof. The Advisor will monitor, on a continuous basis, the earnings power,
cash flow and other liquidity ratios of the issuer of a Master Note held by the
Funds.
FORWARD COMMITMENT AND WHEN-ISSUED SECURITIES. The Funds may purchase securities
on a when-issued basis or for settlement at a future date if the Funds hold
sufficient assets to meet the purchase price. In such purchase transactions the
Funds will not accrue interest on the purchased security until the actual
settlement. Similarly, if a security is sold for a forward date,
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<PAGE>
the Funds will accrue the interest until the settlement of the sale. When-issued
security purchases and forward commitments have a higher degree of risk of price
movement before settlement due to the extended time period between the execution
and settlement of the purchase or sale. As a result, the exposure to the
counterparty of the purchase or sale is increased. Although the Funds would
generally purchase securities on a forward commitment or when-issued basis with
the intention of taking delivery, the Funds may sell such a security prior to
the settlement date if the Advisor felt such action was appropriate. In such a
case, the Funds could incur a short-term gain or loss.
RESTRICTED SECURITIES. Each Fund may purchase securities that are not registered
("restricted securities") under the 1933 Act, but can be offered and sold to
"qualified institutional buyers" under Rule 144A of the 1933 Act. However, a
Fund will not invest more than 10% of its assets in illiquid investments, which
includes securities that are not readily marketable and restricted securities,
unless the Board of Trustees determines, based upon a continuing review of the
trading markets for the specific restricted security, that such restricted
securities are liquid. The Board of Trustees may adopt guidelines and delegate
to the Advisor the daily function of determining and monitoring liquidity of
restricted securities. It is not possible to predict with accuracy how the
markets for certain restricted securities will develop. Investing in restricted
securities could have the effect of increasing the level of a Fund's illiquidity
to the extent that qualified institutional buyers become, for a time,
uninterested in purchasing these securities. Each Fund currently intends to
limit its investments in restricted securities to no more than 5% of its net
assets.
DESCRIPTION OF BOND RATINGS
The various ratings used by the NRSROs are described below. A rating by an NRSRO
represents the organization's opinion as to the credit quality of the security
being traded. However, the ratings are general and are not absolute standards of
quality or guarantees as to the creditworthiness of an issuer. Consequently, the
Advisor believes that the quality of fixed-income securities in which the Funds
may invest should be continuously reviewed and that individual analysts give
different weightings to the various factors involved in credit analysis. A
rating is not a recommendation to purchase, sell or hold a security because it
does not take into account market value or suitability for a particular
investor. When a security has received a rating from more than one NRSRO, each
rating is evaluated independently. Ratings are based on current information
furnished by the issuer or obtained by the NRSROs from other sources that they
consider reliable. Ratings may be changed, suspended or withdrawn as a result of
changes in or unavailability of such information, or for other reasons.
- 5 -
<PAGE>
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S BOND RATINGS:
AAA: Bonds rated Aaa are judged to be of the best quality. These bonds
carry the smallest degree of investment risk and are generally referred to as
"gilt edged." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.
AA: Bonds rated Aa are judged to be of 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 in Aa securities or fluctuation of protective elements may
be of greater amplitude or there may be other elements that make the long term
risks appear somewhat larger than in Aaa securities.
A: Bonds rated A possess many favorable investment attributes and are to
be considered upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present that
suggest a susceptibility to impairment sometime in the future.
BAA: Bonds 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.
Moody's applies numerical modifiers (1,2 and 3) with respect to bonds rated Aa,
A and Baa. The modifier 1 indicates that the bond being rated ranks in the
higher end of its generic rating category; the modifier 2 indicates a mid-range
ranking; and the modifier 3 indicates that the bond ranks in the lower end of
its generic rating category.
DESCRIPTION OF STANDARD & POOR'S RATINGS GROUP'S BOND RATINGS:
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 small degree.
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<PAGE>
A: Bonds rated A have a strong capacity to pay principal and interest,
although they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions.
BBB: Bonds rated BBB are regarded as having an 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.
To provide more detailed indications of credit quality, the AA, A and BBB
ratings may be modified by the addition of a plus or minus sign to show relative
standing within these major rating categories.
DESCRIPTION OF FITCH INVESTORS SERVICE INC.'S BOND RATINGS:
AAA: Bonds considered to be investment grade and of the highest credit
quality. The obligor has an exceptionally strong ability to pay interest and
repay principal, which is unlikely to be affected by reasonably foreseeable
events.
AA: Bonds considered to be investment grade and of very high credit
quality. The obligor's ability to pay interest and repay principal is very
strong, although not quite as strong as bonds rated AAA.
A: Bonds considered to be investment grade and of high credit quality. The
obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.
BBB: Bonds considered to be investment grade and of satisfactory credit
quality. The obligor's ability to pay interest and repay principal is considered
to be adequate. Adverse changes in economic conditions and circumstances,
however, are more likely to have adverse impact on these bonds, and therefore,
impair timely payment.
To provide more detailed indications of credit quality, the AA, A and BBB
ratings may be modified by the addition of a plus or minus sign to show relative
standing within a rating category.
DESCRIPTION OF DUFF & PHELPS CREDIT RATING CO.'S BOND RATINGS:
AAA: This is the highest rating credit quality. The risk factors are
negligible, being only slightly more than for risk- free U.S. Treasury debt.
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<PAGE>
AA: Bonds rated AA are considered to be of high credit quality.
Protection factors are strong. Risk is modest but may vary slightly from time
to time because of economic conditions.
A: Bonds rated A have average protection factors. However risk factors
are more variable and greater in periods of economic stress.
BBB: Bonds rated BBB have below average protection factors, but are
considered sufficient for prudent investment. There is considerable variability
in risk during economic cycles.
INVESTMENT LIMITATIONS
The Funds have adopted the following investment limitations, in addition to
those described in the Prospectus, which cannot be changed without approval by
holders of a majority of the outstanding voting shares of the Funds. A
"majority" for this purpose, means the lesser of (i) 67% of a Fund's outstanding
shares represented in person or by proxy at a meeting at which more than 50% of
its outstanding shares are represented, or (ii) more than 50% of its outstanding
shares.
Under these limitations, each Fund MAY NOT:
(1) Invest more than 5% of the value of its total assets in the
securities of any one issuer (except that securities of the
U.S. Government, its agencies or instrumentalities are not
subject to these limitations);
(2) Invest 25% or more of the value of its total assets in any
one industry or group of industries (except that securities
of the U.S. Government, its agencies and instrumentalities
are not subject to these limitations);
(3) Invest in the securities of any issuer if any of the officers or
trustees of the Trust or its Advisor who own beneficially more than 1/2
of 1% of the outstanding securities of such issuer together own more
than 5% of the outstanding securities of such issuer;
(4) Invest for the purpose of exercising control or management
of another issuer;
(5) Invest in interests in real estate, real estate mortgage
loans, oil, gas or other mineral exploration or development
programs, except that the Funds may invest in the securities
of companies (other than those which are not readily
marketable) which own or deal in such things, and the Funds
may invest in certain mortgage backed securities as
described in the Prospectus under "Investment Objectives,
Investment Policies and Risk Considerations";
- 8 -
<PAGE>
(6) Underwrite securities issued by others, except to the extent a Fund may
be deemed to be an underwriter under the federal securities laws in
connection with the disposition of portfolio securities;
(7) Purchase securities on margin (but the Funds may obtain such
short-term credits as may be necessary for the clearance of
transactions);
(8) Make short sales of securities or maintain a short position, except short
sales "against the box." (A short sale is made by selling a security the
Fund does not own. A short sale is "against the box" to the extent the
Fund contemporaneously owns or has the right to obtain at no added cost
securities identical to those sold short.);
(9) Participate on a joint or joint and several basis in any
trading account in securities;
(10) Purchase real estate or interests in real estate, except that
securities in which the Funds invest may themselves have investment in
real estate or interests in real estate (the Funds do invest in
securities composed of mortgages against real estate);
(11) Invest more than 10% in the aggregate in illiquid securities
(potentially including repurchase agreements with a maturity of greater
than 7 days, Interest Only or Principal Only securities, and mortgage
backed strips which may not be readily marketable); or
(12) Write, purchase or sell puts, calls or combinations thereof, or
purchase or sell commodities, commodities contracts, futures contracts
or related options, or purchase, sell or write warrants.
Percentage restrictions stated as an investment policy or investment limitation
apply at the time of investment; if a later increase or decrease in percentage
beyond the specified limits results from a change in securities values or total
assets, it will not be considered a violation.
While the Funds have reserved the right to make short sales "against the box"
(limitation number 8, above), the Advisor has no present intention of engaging
in such transactions at this time or during the coming year.
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<PAGE>
TRUSTEES AND OFFICERS
Following are the Trustees and executive officers of the Williamsburg Investment
Trust (the "Trust"), their present position with the Trust or Funds, age,
principal occupation during the past 5 years and their aggregate compensation
from the Trust for the fiscal year ended March 31, 1997:
<TABLE>
<CAPTION>
<S> <C> <C>
Name, Position, Principal Occupation Compensation
AGE AND ADDRESS DURING PAST 5 YEARS FROM THE TRUST
- ------------------ -------------------- --------------
Austin Brockenbrough III (age 60) President and Managing None
Trustee** Director of Lowe, Brockenbrough
President & Tattersall, Inc.,
The Jamestown International Equity Fund Richmond, Virginia; Director of
The Jamestown Tax Exempt Virginia Fund Tredegar Industries, Inc.
6620 West Broad Street (plastics manufacturer) and
Suite 300 Wilkinson O'Grady & Co. Inc.
Richmond, Virginia 23230 (global asset manager); Trustee
of Univerity of Richmond
John T. Bruce (age 43) Principal of None
Trustee and Chairman** Flippin, Bruce & Porter, Inc.,
Vice President Lynchburg, Virginia
FBP Contrarian Balanced Fund
FBP Contrarian Equity Fund
800 Main Street
Lynchburg, Virginia 24504
Charles M. Caravati, Jr. (age 60) Physician $8,000
Trustee** Dermatology Associates of
5600 Grove Avenue Virginia, P.C.;
Richmond, Virginia 23226 Richmond, Virginia
J. Finley Lee (age 57) Julian Price Professor Emeritus of $8,000
Trustee Business Administration
614 Croom Court University of North Carolina,
Chapel Hill, North Carolina 27514 Chapel Hill, North Carolina;
Director of Montgomery Mutual
Insurance Co.
Richard Mitchell (age 48) Principal of None
Trustee** T. Leavell & Associates, Inc.,
President Mobile, Alabama
The Government Street Bond Fund
The Government Street Equity Fund
The Alabama Tax Free Bond Fund
150 Government Street
Mobile, Alabama 36602
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<PAGE>
<CAPTION>
<S> <C> <C>
Richard L. Morrill (age 58) President of $8,000
Trustee University of Richmond,
7000 River Road Richmond, Virginia;
Richmond, Virginia 23229 Director of Central Fidelity Banks, Inc.
and Tredegar Industries, Inc.
Harris V. Morrissette (age 37) President of $7,000
Trustee Marshall Biscuit Co. Inc.,
1500 S. Beltline Hwy. Mobile, Alabama;
Mobile, Alabama 36693 President of Azalea Aviation, Inc.
(airplane fueling); Director of
Bank of Mobile
Fred T. Tattersall (age 48) Managing Director of None
Trustee** Lowe, Brockenbrough & Tattersall
President Strategic Advisors, Inc.,
The Jamestown Bond Fund Richmond, Virginia
The Jamestown Short Term Bond Fund
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
Erwin H. Will, Jr. (age 64) Chief Investment Officer of None
Trustee Virginia Retirement System,
P.O. Box 2500 Richmond, Virginia
Richmond, Virginia 23218
Samuel B. Witt III (age 61) Senior Vice President and $6,500
Trustee General Counsel of Stateside
2300 Clarendon Blvd. Associates, Inc., Arlington,
Suite 407 Virginia; Director of The Swiss
Arlington, Virginia 22201 Helvetic Fund, Inc. (closed-end
investment company)
Charles M. Caravati III (age 31) Assistant Portfolio Manager of
Vice President Lowe, Brockenbrough & Tattersall, Inc.,
The Jamestown International Equity Fund Richmond, Virginia
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
John M. Flippin (age 55) Principal of
President Flippin, Bruce & Porter, Inc.,
FBP Contrarian Balanced Fund Lynchburg, Virginia
FBP Contrarian Equity Fund
800 Main Street
Lynchburg, Virginia 24504
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<PAGE>
<CAPTION>
<S> <C>
Timothy S. Healey (age 44) Vice President of
Vice President T. Leavell & Associates, Inc.,
The Alabama Tax Free Bond Fund Mobile, Alabama
150 Government Street
Mobile, Alabama 36602
R. Gregory Porter, III (age 56) Principal of
Vice President Flippin, Bruce & Porter, Inc.,
FBP Contrarian Balanced Fund Lynchburg, Virginia
FBP Contrarian Equity Fund
800 Main Street
Lynchburg, Virginia 24504
Mark J. Seger (age 35) Vice President of Countrywide Fund Services,
Treasurer Inc. and Countrywide Financial Services, Inc.;
312 Walnut Street, 21st Floor Treasurer, Countrywide Investment Trust,
Cincinnati, Ohio 45202 Countrywide Tax-Free Trust and Countrywide
Strategic Trust
Cincinnati, Ohio
Henry C. Spalding, Jr. (age 59) Executive Vice President of
President Lowe, Brockenbrough & Tattersall, Inc.,
The Jamestown Balanced Fund Richmond, Virginia
The Jamestown Equity Fund
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
John F. Splain (age 40) Vice President, General Counsel and Secretary
Secretary of Countrywide Fund Services, Inc.; General
312 Walnut Street, 21st Floor Counsel and Secretary, Countrywide
Cincinnati, Ohio 45202 Investments, Inc. and Countrywide Financial
Services, Inc.; Secretary, Countrywide Investment
Trust, Countrywide Tax-Free Trust and
Countrywide Strategic Trust
Cincinnati, Ohio
Ernest H. Stephenson, Jr. (age 52) Vice President of
Vice President Lowe, Brockenbrough & Tattersall, Inc.,
The Jamestown Balanced Fund Richmond, Virginia
The Jamestown Equity Fund
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
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<PAGE>
<CAPTION>
<S> <C>
Connie R. Taylor (age 46) Administrator of
Vice President Lowe, Brockenbrough & Tattersall, Inc.,
The Jamestown Balanced Fund Richmond, Virginia
The Jamestown Equity Fund
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
Craig D. Truitt (age 38) Senior Vice President of
Vice President Lowe, Brockenbrough & Tattersall
The Jamestown Bond Fund Strategic Advisors, Inc.,
The Jamestown Short Term Bond Fund Richmond, Virginia
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
Beth Ann Walk (age 38) Portfolio Manager of
Vice President Lowe, Brockenbrough & Tattersall, Inc.,
The Jamestown Tax Exempt Virginia Fund Richmond, Virginia
6620 West Broad Street
Suite 300
Richmond, Virginia 23230
- -----------------------------
**Indicates that Trustee is an Interested Person for purposes of the 1940 Act. Charles M.
Caravati, Jr. is the father of Charles M. Caravati III.
</TABLE>
Messrs. Lee, Morrill, Morrissette, Will and Witt constitute the Trust's
Nominating Committee. Messrs. Caravati, Lee, Morrill, Morrissette, Will and Witt
constitute the Trust's Audit Committee. The Audit Committee reviews annually the
nature and cost of the professional services rendered by the Trust's independent
accountants, the results of their year-end audit and their findings and
recommendations as to accounting and financial matters, including the adequacy
of internal controls. On the basis of this review the Audit Committee makes
recommendations to the Trustees as to the appointment of independent accountants
for the following year.
PRINCIPAL HOLDERS OF VOTING SECURITIES. As of May 23, 1997, the Trustees and
Officers of the Trust as a group owned beneficially (i.e., had voting and/or
investment power) % of the then outstanding shares of the Bond Fund and % of the
then outstanding shares of the Short Term Fund. On the same date, Rockingham
Health Care, Inc., 235 Cantrell Avenue, Harrisonburg, Virginia 22801, owned of
record 54.4% of the then outstanding shares of the Short Term Fund and may
therefore be deemed to control the Short Term Fund. On the same date, Halifax
Regional Hospital, 2204 Wilborn Avenue, South Boston, Virginia 24592,
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<PAGE>
owned of record 13.3% of the then outstanding shares of the Bond Fund; Crestar
Bank as Trustee for Hourly Employees Norshipco Pension Plans, P.O. Box 2642,
Norfolk, Virginia 23501, owned of record 6.5% of the then outstanding shares of
the Bond Fund; Crestar Bank as Trustee for Norfolk Dredging Company Profit
Sharing Plan, P.O. Box 26246, Richmond, Virginia 23260, owned of record 5.9% of
the then outstanding shares of the Bond Fund; Rockingham Health Care, Inc., 235
Cantrell Avenue, Harrisonburg, Virginia 22801, owned of record 12.6% of the then
outstanding shares of the Bond Fund; Rockingham Memorial Hospital Retirement
Plan, 235 Cantrell Avenue, Harrisonburg, Virginia 22801, owned of record 8.4% of
the then outstanding shares of the Bond Fund; Calvert Memorial Hospital, 100
Hospital Road, Prince Frederick, Maryland 20678, owned of record 10.1% of the
then outstanding shares of the Bond Fund; Virginia International Terminals, Inc.
Pension Plan, P.O. Box 1387, Norfolk, Virginia 23501, owned of record 11.6% of
the then outstanding shares of the Bond Fund; The Lincoln Lane Foundation, 112
Granby Street, Norfolk, Virginia 23510, owned of record 5.1% of the then
outstanding shares of the Bond Fund; the Lowe, Brockenbrough & Tattersall Money
Purchase Pension Plan, 6620 West Broad Street, Richmond, Virginia 23230, owned
of record 10.6% of the then outstanding shares of the Short Term Fund; the
McKay-Dee Foundation, 3939 Harrison Boulevard, Ogden, Utah 84403, owned of
record 8.5% of the then outstanding shares of the Short Term Fund; and Centura
Investment Management & Trust Services, P.O. Box 1220, Rocky Mount, North
Carolina 27802, owned of record 10.7% of the then outstanding shares of the
Short Term Fund.
INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall, Strategic Advisors, Inc. (the "Advisor")
supervises each Fund's investments pursuant to an Investment Advisory Agreement
(the "Advisory Agreement") described in the Prospectus. The Advisory Agreement
is effective until February 28, 1999 and will be renewed thereafter for one year
periods only so long as such renewal and continuance is specifically approved at
least annually by the Board of Trustees or by vote of a majority of the Funds'
outstanding voting securities, provided the continuance is also approved by a
majority of the Trustees who are not "interested persons" of the Trust or the
Advisor by vote cast in person at a meeting called for the purpose of voting on
such approval. The Advisory Agreement is terminable without penalty on sixty
days notice by the Board of Trustees of the Trust or by the Advisor. The
Advisory Agreement provides that it will terminate automatically in the event of
its assignment.
The Advisor is a Virginia corporation controlled by its sole
shareholder, Fred T. Tattersall. Prior to February 28, 1997, the
investment advisor to each Fund was Lowe, Brockenbrough &
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<PAGE>
Tattersall, Inc. ("LB&T"), of which Mr. Tattersall and Austin Brockenbrough
III were the controlling shareholders. On February 28, 1997, LB&T was
reorganized by means of a corporate restructuring into two separate legal
entities: LB&T, owned by Mr. Brockenbrough, and the Advisor, owned by Mr.
Tattersall. The Advisor manages the fixed-income accounts formerly managed by
LB&T. In addition to acting as Advisor to the Funds, the Advisor provides
investment advice to corporations, trusts, pension and profit sharing plans,
other business and institutional accounts and individuals.
Compensation of the Advisor, with respect to each Fund, is at the annual rate of
0.375% of such Fund's average daily net assets. For the fiscal years ended March
31, 1997, 1996 and 1995, the Advisor and/or LB&T received investment advisory
fees of $289,094, $305,247 and $242,915, respectively, from the Bond Fund. For
the fiscal year ended March 31, 1997, the Advisor and LB&T each waived its
entire investment advisory fee from the Short Term Fund and reimbursed the Fund
for $6,864 of other operating expenses. For the fiscal years ended March 31,
1996 and 1995, LB&T received investment advisory fees of $3,786 (which was net
of voluntary fee waivers of $43,635) and $3,372 (net of voluntary fee waivers of
$49,560), respectively, from the Short Term Fund.
The Advisor provides a continuous investment program for the Funds, including
investment research and management with respect to all securities, investments,
cash and cash equivalents of the Funds. The Advisor determines what securities
and other investments will be purchased, retained or sold by the Funds, and does
so in accordance with the investment objectives and policies of the Funds as
described herein and in the Prospectus. The Advisor places all securities orders
for the Funds, determining with which broker, dealer, or issuer to place the
orders.
The Advisor must adhere to the brokerage policies of the Funds in placing all
orders, the substance of which policies are that the Advisor must seek at all
times the most favorable price and execution for all securities brokerage
transactions.
The Advisor also provides, at its own expense, certain Executive Officers to the
Trust.
ADMINISTRATOR
Countrywide Fund Services, Inc. (the "Administrator") maintains the records of
each shareholder's account, answers shareholders' inquiries concerning their
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions. The Administrator also provides accounting
- 15 -
<PAGE>
and pricing services to the Funds and supplies non-investment related
statistical and research data, internal regulatory compliance services and
executive and administrative services. The Administrator supervises the
preparation of tax returns, reports to shareholders of the Funds, reports to and
filings with the Securities and Exchange Commission and state securities
commissions, and materials for meetings of the Board of Trustees.
For the performance of these administrative services, each Fund pays the
Administrator a base fee at the annual rate of 0.075% of the average value of
its daily net assets up to $200,000,000 and 0.05% of such assets in excess of
$200,000,000 (subject to a minimum fee of $2,000 per month for each Fund) plus a
surcharge of $1,000 per month. In addition, the Funds pay out-of-pocket
expenses, including but not limited to, postage, envelopes, checks, drafts,
forms, reports, record storage and communication lines.
For the fiscal years ended March 31, 1997, 1996 and 1995, the Administrator
received fees of $57,859, $61,029 and $49,025, respectively, from the Bond Fund
and $24,000, $24,000 and $23,301, respectively, from the Short Term Fund.
OTHER SERVICES
The firm of Tait, Weller & Baker, Two Penn Center Plaza, Philadelphia,
Pennsylvania 19102, has been retained by the Board of Trustees to perform an
independent audit of the books and records of the Trust, to review the Funds'
federal and state tax returns and to consult with the Trust as to matters of
accounting and federal and state income taxation.
The Custodian of the Funds' assets is Star Bank, N.A., 425 Walnut Street,
Cincinnati, Ohio 45202. The Custodian holds all cash and securities of the Funds
(either in its possession or in its favor through "book entry systems"
authorized by the Trustees in accordance with the 1940 Act), collects all income
and effects all securities transactions on behalf of the Funds.
BROKERAGE
It is the Funds' practice to seek the best price and execution for all portfolio
securities transactions. The Advisor (subject to the general supervision of the
Board of Trustees) directs the execution of the Funds' portfolio transactions.
The Trust has adopted a policy which prohibits the Advisor from effecting Fund
portfolio transactions with broker-dealers which may be interested persons of
either Fund, the Trust, any Trustee, officer or director of the Trust or its
investment advisors or any interested person of such persons.
- 16 -
<PAGE>
The Funds' portfolio transactions will normally be principal transactions
executed in over-the-counter markets and will be executed on a "net" basis,
which may include a dealer markup. However, the Bond Fund typically transacts in
shares of closed-end investment companies on an agency basis, and pays
commissions in connection with these transactions.
For the fiscal years ended March 31, 1997, 1996 and 1995, the total amount of
brokerage commissions paid by the Bond Fund was $25,248, $126,787 and $0,
respectively. No brokerage commissions were paid by the Short Term Fund for the
last three fiscal years.
While there is no formula, agreement or undertaking to do so, the Advisor may
allocate a portion of either Fund's brokerage commissions to persons or firms
providing the Advisor with research services, which may typically include, but
are not limited to, investment recommendations, financial, economic, political,
fundamental and technical market and interest rate data, and other statistical
or research services. Much of the information so obtained may also be used by
the Advisor for the benefit of the other clients it may have. Conversely, the
Funds may benefit from such transactions effected for the benefit of other
clients. In all cases, the Advisor is obligated to effect transactions for the
Funds based upon obtaining the most favorable price and execution. Factors
considered by the Advisor in determining whether the Funds will receive the most
favorable price and execution include, among other things: the size of the
order, the broker's ability to effect and settle the transaction promptly and
efficiently and the Advisor's perception of the broker's reliability, integrity
and financial condition.
In an effort to reduce the total operating expenses of the Bond Fund, a portion
of the Fund's custodian fees have been reimbursed through an arrangement with a
third party broker-dealer who is compensated through security trades. Total
custodian expenses reimbursed by the broker-dealer for the year ended March 31,
1997 were $22,926.
During the fiscal year ended March 31, 1997, the Bond Fund acquired bonds issued
by Lehman Brothers Holdings (having a market value of $1,821,417 as of March 31,
1997) and Morgan Stanley Group (having a market value of $658,281 as of March
31, 1997), the parents of two of the Trust's "regular broker-dealers" as defined
in the 1940 Act.
SPECIAL SHAREHOLDER SERVICES
As noted in the Prospectus, the Funds offer the following shareholder services:
- 17 -
<PAGE>
REGULAR ACCOUNT. The regular account allows for voluntary investments to be made
at any time. Available to individuals, custodians, corporations, trusts,
estates, corporate retirement plans and others, investors are free to make
additions and withdrawals to or from their account as often as they wish. When
an investor makes an initial investment in the Funds, a shareholder account is
opened in accordance with the investor's registration instructions. Each time
there is a transaction in a shareholder account, such as an additional
investment or the reinvestment of a dividend or distribution, the shareholder
will receive a statement showing the current transaction and all prior
transactions in the shareholder account during the calendar year to date.
PURCHASES IN KIND. The Funds may accept securities in lieu of cash in payment
for the purchase of shares of the Funds. The acceptance of such securities is at
the sole discretion of the Advisor based upon the suitability of the securities
accepted for inclusion as a long term investment of the Funds, the marketability
of such securities, and other factors which the Advisor may deem appropriate. If
accepted, the securities will be valued using the same criteria and methods as
described in "How Net Asset Value is Determined" in the Prospectus.
REDEMPTIONS IN KIND. The Funds do not intend, under normal circumstances, to
redeem their securities by payment in kind. It is possible, however, that
conditions may arise in the future which would, in the opinion of the Trustees,
make it undesirable for the Funds to pay for all redemptions in cash. In such
case, the Board of Trustees may authorize payment to be made in portfolio
securities or other property of the Funds. Securities delivered in payment of
redemptions would be valued at the same value assigned to them in computing the
net asset value per share. Shareholders receiving them would incur brokerage
costs when these securities are sold. An irrevocable election may be filed under
Rule 18f-1 of the 1940 Act, wherein each Fund commits itself to pay redemptions
in cash, rather than in kind, to any shareholder of record of the Funds who
redeems during any ninety day period, the lesser of (a) $250,000 or (b) one
percent (1%) of a Fund's net assets at the beginning of such period.
TRANSFER OF REGISTRATION. To transfer shares to another owner, send a written
request to the Funds at the address shown herein. Your request should include
the following: (1) the Fund name and existing account registration; (2)
signature(s) of the registered owner(s) exactly as the signature(s) appear(s) on
the account registration; (3) the new account registration, address, social
security or taxpayer identification number and how dividends and capital gains
are to be distributed; (4) signature guarantees (see the Prospectus under the
heading "Signature Guarantees"); and (5) any additional documents which are
required for transfer by corporations, administrators, executors, trustees,
guardians, etc. If you have any questions about transferring shares, call or
write the Funds.
- 18 -
<PAGE>
PLAN OF DISTRIBUTION
As described in the Prospectus, Consultant Shares of the Fund have adopted a
plan of distribution (the "Plan") pursuant to Rule 12b-1 under the Investment
Company Act of 1940 which permits Consultant Shares to pay for expenses incurred
in the distribution and promotion of the Funds' Consultant Shares, including but
not limited to, the printing of prospectuses, statements of additional
information and reports used for sales purposes, advertisements, expenses of
preparation and printing of sales literature, promotion, marketing and sales
expenses, and other distribution related expenses, including any distribution
fees paid to securities dealers or other firms who have executed a distribution
or service agreement with the Advisor. The Plan expressly limits payment of
distribution expenses listed above in any fiscal year to a maximum of .15% of
the average daily net assets of Consultant Shares of the Fund. Unreimbursed
expenses will not be carried over from year to year.
Agreements implementing the Plan (the "Implementation Agreements"), including
agreements with financial consultants and other intermediaries wherein such
financial consultants and other intermediaries agree for a fee to act as agents
for the sale of the Fund's Consultant Shares, are in writing and have been
approved by the Board of Trustees. All payments made pursuant to the Plan are
made in accordance with written agreements.
The continuance of the Plan and the Implementation Agreements must be
specifically approved at least annually by a vote of the Trustees who are not
interested persons of the Trust and have no direct or indirect financial
interest in the Plan or any Implementation Agreement (the "Independent
Trustees") at a meeting called for the purpose of voting on such continuance.
The Plan may be terminated at any time by a vote of the majority of the
Independent Trustees or by a vote of the holders of a majority of the
outstanding Consultant Shares of the Fund. In the event the Plan is terminated
in accordance with its terms, Consultant Shares will not be required to make any
payments for expenses incurred by the Advisor after the termination date. Each
Implementation Agreement terminates automatically in the event of its assignment
and may be terminated at any time by a vote of a majority of the Independent
Trustees or by a vote of the holders of a majority of the outstanding Consultant
Shares on not more than 60 days' written notice to any other party to the
Implementation Agreement.The Plan may not be amended to increase materially the
amount to be spent for distribution without shareholder approval. All material
amendments to the Plan must be approved by a vote of the Independent Trustees.
- 19 -
<PAGE>
In approving the Plan, the Trustees determined, in the exercise of their
business judgment and in light of their fiduciary duties as Trustees, that there
is a reasonable likelihood that the Plan will benefit the Funds and the holders
of their Consultant Shares. The Board of Trustees believes that the expenditure
of assets of Consultant Shares for distribution expenses under the Plan should
assist in the growth of such shares which will benefit the Funds and the holders
of their Consultant Shares through increased economies of scale, greater
investment flexibility, greater portfolio diversification and less chance of
disruption of planned investment strategies. The Plan will be renewed only if
the Trustees make a similar determination for each subsequent year of the Plan.
There can be no assurance that the benefits anticipated from the expenditure of
Consultant Shares' assets for distribution will be realized. While the Plan is
in effect, all amounts spent by Consultant Shares pursuant to the Plan and the
purposes for which such expenditures were made must be reported quarterly to the
Board of Trustees for its review. The selection and nomination of those Trustees
who are not interested persons of the Trust are committed to the discretion of
the Independent Trustees during such period.
PURCHASE OF SHARES
The purchase price of shares of each Fund is the net asset value next determined
after the order is received. An order received prior to 4:00 p.m., Eastern time
will be executed at the price computed on the date of receipt; and an order
received after that time will be executed at the price computed on the next
Business Day. An order to purchase shares is not binding on the Funds until
confirmed in writing (or unless other arrangements have been made with the
Funds, for example in the case of orders utilizing wire transfer of funds) and
payment has been received.
Each Fund reserves the right in its sole discretion (i) to suspend the offering
of its shares, (ii) to reject purchase orders when in the judgment of management
such rejection is in the best interest of the Fund and its shareholders, and
(iii) to reduce or waive the minimum for initial and subsequent investments
under circumstances where certain economies can be achieved in sales of Fund
shares.
EMPLOYEES AND AFFILIATES OF THE FUNDS. The Funds have adopted initial investment
minimums for the purpose of reducing the cost to the Funds (and consequently to
the shareholders) of communicating with and servicing their shareholders.
However, a reduced minimum initial investment requirement of $5,000 applies to
Trustees, officers and employees of the Funds, the Advisor and certain parties
related thereto, including clients of the Advisor or any sponsor, officer,
committee member thereof, or the immediate family of any of them. In addition,
accounts having
- 20 -
<PAGE>
the same mailing address may be aggregated for purposes of the minimum
investment if they consent in writing to share a single mailing of shareholder
reports, proxy statements (but each such shareholder would receive his/her own
proxy) and other Fund literature.
REDEMPTION OF SHARES
Each Fund may suspend redemption privileges or postpone the date of payment (i)
during any period that the New York Stock Exchange (the "Exchange") is closed,
or trading on the Exchange is restricted as determined by the Securities and
Exchange Commission (the "Commission"), (ii) during any period when an emergency
exists as defined by the rules of the Commission as a result of which it is not
reasonably practicable for the Fund to dispose of securities owned by it, or to
fairly determine the value of its assets, and (iii) for such other periods as
the Commission may permit.
No charge is made by the Funds for redemptions, although the Trustees could
impose a redemption charge in the future. Any redemption may be more or less
than the shareholder's cost depending on the market value of the securities held
by the Funds.
NET ASSET VALUE DETERMINATION
Under the 1940 Act, the Trustees are responsible for determining in good faith
the fair value of the securities and other assets of the Funds, and they have
adopted procedures to do so, as follows. The net asset value of each Fund is
determined as of the close of trading of the Exchange (currently 4:00 p.m.,
Eastern time) on each "Business Day." A Business Day means any day, Monday
through Friday, except for the following holidays: New Year's Day, Presidents'
Day, Good Friday, Memorial Day, Fourth of July, Labor Day, Columbus Day,
Veterans Day, Thanksgiving Day and Christmas. Net asset value per share is
determined by dividing the total value of all Fund securities and other assets,
less liabilities, by the total number of shares then outstanding. Net asset
value includes interest on fixed income securities, which is accrued daily.
ALLOCATION OF TRUST EXPENSES
Each Fund of the Trust pays all of its own expenses not assumed by the Advisor
or the Administrator, including, but not limited to, the following: custodian,
shareholder servicing, stock transfer and dividend disbursing expenses; clerical
employees and junior level officers of the Trust as and if approved by the Board
of Trustees; taxes; expenses of the issuance and redemption of shares (including
registration and qualification fees and expenses); costs and expenses of
membership and attendance at meetings of certain associations which may be
deemed by the
- 21 -
<PAGE>
Trustees to be of overall benefit to the Fund and its shareholders; legal and
auditing expenses; and the cost of stationery and forms prepared exclusively for
the Funds. General Trust expenses are allocated among the series, or funds, on a
fair and equitable basis by the Board of Trustees, which may be based on
relative net assets of each fund (on the date the expense is paid) or the nature
of the services performed and the relative applicability to each fund.
ADDITIONAL TAX INFORMATION
TAXATION OF THE FUNDS. Each Fund intends to qualify as a "regulated investment
company" under Subchapter M of the Internal Revenue Code of 1986, as amended
(the "Code"). Among its requirements to qualify under Subchapter M, each Fund
must distribute annually at least 90% of its net investment income. In addition
to this distribution requirement, each Fund must derive at least 90% of its
gross income each taxable year from dividends, interest, payments with respect
to securities' loans, gains from the disposition of stock or securities, and
certain other income. Each Fund will also be required to derive less than 30% of
its gross income from the sale or other disposition of securities held for less
than 90 days.
While the above requirements are aimed at qualification of the Funds as
regulated investment companies under Subchapter M of the Code, the Funds also
intend to comply with certain requirements of the Code to avoid liability for
federal income and excise tax. If the Funds remain qualified under Subchapter M,
they will not be subject to federal income tax to the extent they distribute
their taxable net investment income and net realized capital gains. A
nondeductible 4% federal excise tax will be imposed on each Fund to the extent
it does not distribute at least 98% of its ordinary taxable income for a
calendar year, plus 98% of its capital gain net taxable income for the one year
period ending each October 31, plus certain undistributed amounts from prior
years. While each Fund intends to distribute its taxable income and capital
gains in a manner so as to avoid imposition of the federal excise and income
taxes, there can be no assurance that the Funds indeed will make sufficient
distributions to avoid entirely imposition of federal excise or income taxes.
As of March 31, 1997, the Bond Fund and the Short Term Fund had capital loss
carryforwards for federal income tax purposes of $1,440,604 and $508,929,
respectively, which expire on March 31, 2004. These capital loss carryforwards
may be utilized in future years to offset net realized gains prior to
distributing such gains to shareholders.
Should additional series, or funds, be created by the Trustees, each fund would
be treated as a separate tax entity for federal income tax purposes.
- 22 -
<PAGE>
TAX STATUS OF THE FUNDS' DIVIDENDS AND DISTRIBUTIONS. Dividends paid by the
Funds derived from net investment income or net short-term capital gains are
taxable to shareholders as ordinary income, whether received in cash or
reinvested in additional shares. Distributions, if any, of long-term capital
gains are taxable to shareholders as long-term capital gains, whether received
in cash or reinvested in additional shares, regardless of how long Fund shares
have been held. For information on "backup" withholding, see "How to Purchase
Shares" in the Prospectus.
Each Fund will send shareholders information each year on the tax status of
dividends and disbursements. A dividend or capital gains distribution paid
shortly after shares have been purchased, although in effect a return of
investment, is subject to federal income taxation. Dividends from net investment
income, along with capital gains, will be taxable to shareholders, whether
received in cash or shares and no matter how long you have held Fund shares,
even if they reduce the net asset value of shares below your cost and thus in
effect result in a return of part of your investment.
CAPITAL SHARES AND VOTING
Shares of the Funds, when issued, are fully paid and non-assessable and have no
preemptive or conversion rights. Shareholders are entitled to one vote for each
full share and a fractional vote for each fractional share held. Shares have
noncumulative voting rights, which means that the holders of more than 50% of
the shares voting for the election of Trustees can elect 100% of the Trustees
and, in this event, the holders of the remaining shares voting will not be able
to elect any Trustees. The Trustees will hold office indefinitely, except that:
(1) any Trustee may resign or retire and (2) any Trustee may be removed with or
without cause at any time (a) by a written instrument, signed by at least
two-thirds of the number of Trustees prior to such removal; or (b) by vote of
shareholders holding not less than two-thirds of the outstanding shares of the
Trust, cast in person or by proxy at a meeting called for that purpose; or (c)
by a written declaration signed by shareholders holding not less than two-thirds
of the outstanding shares of the Trust and filed with the Trust's custodian.
Shareholders have certain rights, as set forth in the Declaration of Trust,
including the right to call a meeting of the shareholders for the purpose of
voting on the removal of one or more Trustees. Shareholders holding not less
than ten percent (10%) of the shares then outstanding may require the Trustees
to call such a meeting and the Trustees are obligated to provide certain
assistance to shareholders desiring to communicate with other shareholders in
such regard (e.g., providing access to shareholder lists, etc.). In case a
vacancy or an anticipated vacancy shall for any reason exist, the vacancy
- 23 -
<PAGE>
shall be filled by the affirmative vote of a majority of the remaining Trustees,
subject to the provisions of Section 16(a) of the 1940 Act. The Trust does not
expect to have an annual meeting of shareholders.
Both Consultant Shares and Institutional Shares of a Fund represent an interest
in the same assets of the Fund, have the same rights and are identical in all
material respects except that (i) Consultant Shares bear the expenses of
distribution fee; (ii) certain class specific expenses will be borne solely by
the class to which such expenses are attributable, including transfer agent fees
attributable to a specific class of shares, printing and postage expenses
related to preparing and distributing materials to current shareholders of a
specific class, registration fees incurred by a specific class of shares, the
expenses of administrative personnel and services required to support the
shareholders of a specific class, litigation or other legal expenses relating to
a class of shares, Trustees' fees or expenses incurred as a result of issues
relating to a specific class of shares and accounting fees and expenses relating
to a specific class of shares; and (iii) each class has exclusive voting rights
with respect to matters affecting only that class. The Board of Trustees may
classify and reclassify shares of the Funds into additional classes of shares at
a future date.
Prior to January 24, 1994 the Trust was called The Nottingham Investment Trust.
CALCULATION OF PERFORMANCE DATA
As indicated in the Prospectus, each Fund may, from time to time, advertise
certain total return and yield information. The average annual total return of
the Funds for a period is computed by subtracting the net asset value per share
at the beginning of the period from the net asset value per share at the end of
the period (after adjusting for the reinvestment of any income dividends and
capital gain distributions), and dividing the result by the net asset value per
share at the beginning of the period. In particular, the average annual total
return of a Fund ("T") is computed by using the redeemable value at the end of a
specified period of time ("ERV") of a hypothetical initial investment of $1,000
("P") over a period of time ("n") according to the formula P(l+T)n=ERV. The
average annual total return quotations for the Bond Fund for the one year period
ended March 31, 1997, for the five year period ended March 31, 1997 and for the
period since inception (December 13, 1990) to March 31, 1997 are 5.52%, 6.96%
and 7.43%, respectively. The average annual total return quotations for the
Short Term Fund for the one year period ended March 31, 1997, for the five year
period ended March 31, 1997 and for the period since inception (January 21,
1992) to March 31, 1997 are 5.01%, 5.21% and 5.04%, respectively.
- 24 -
<PAGE>
In addition, each Fund may advertise other total return performance data
("Nonstandardized Return"). Nonstandardized Return shows as a percentage rate of
return encompassing all elements of return (i.e., income and capital
appreciation or depreciation); it assumes reinvestment of all dividends and
capital gain distributions. Nonstandardized Return may consist of a cumulative
percentage of return, actual year-by-year rates or any combination thereof.
From time to time, each Fund may advertise its yield. A yield quotation is based
on a 30-day (or one month) period and is computed by dividing the net investment
income per share earned during the period by the maximum offering price per
share on the last day of the period, according to the following formula:
Yield = 2[(a-b/cd + 1)6 - 1]
Where:
a = dividends and interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding during the
period that were entitled to receive dividends
d = the maximum offering price per share on the last day of the
period
Generally, interest earned (for the purpose of "a" above) on debt obligations is
computed by reference to the yield to maturity of each obligation held based on
the market value of the obligation (including actual accrued interest) at the
close of business on the last business day prior to the start of the 30-day (or
one month) period for which yield is being calculated, or, with respect to
obligations purchased during the month, the purchase price (plus actual accrued
interest). The yields of the Bond Fund and the Short Term Fund for the 30 days
ended March 31, 1997 were 6.59% and 5.58%, respectively.
The Funds' performance may be compared in advertisements, sales literature and
other communications to the performance of other mutual funds having similar
objectives or to standardized indices or other measures of investment
performance. In particular, the Bond Fund may compare its performance to the
Lehman Brothers Government/Corporate Index and the Lehman Brothers Aggregate
Index, which are generally considered to be representative of the performance of
taxable bonds, and the Short Term Fund may compare its performance to the
Merrill Lynch 1-3 Year Treasury Index. Comparative performance may also be
expressed by reference to a ranking prepared by a mutual fund monitoring
service, such as Lipper Analytical Services, Inc. or Morningstar, Inc., or by
one or more newspapers, newsletters or financial periodicals. Performance
comparisons may be useful to investors who wish to compare the Funds' past
performance to that of other mutual funds and investment products. Of course,
past performance is not a guarantee of future results.
- 25 -
<PAGE>
o LIPPER ANALYTICAL SERVICES, INC. ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all capital gains distributions and income
dividends and takes into account any change in net asset value over a
specific period of time.
o MORNINGSTAR, INC., an independent rating service, is the publisher of
the bi-weekly Mutual Fund Values. Mutual Fund Values rates more than
1,000 NASDAQ-listed mutual funds of all types, according to their
risk-adjusted returns. The maximum rating is five stars, and ratings
are effective for two weeks.
Investors may use such indices in addition to the Funds' Prospectus to obtain a
more complete view of the Funds' performance before investing. Of course, when
comparing the Funds' performance to any index, factors such as composition of
the index and prevailing market conditions should be considered in assessing the
significance of such comparisons. When comparing funds using reporting services,
or total return, investors should take into consideration any relevant
differences in funds such as permitted portfolio compositions and methods used
to value portfolio securities and compute offering price. Advertisements and
other sales literature for the Funds may quote total returns that are calculated
on non-standardized base periods. The total returns represent the historic
change in the value of an investment in the Funds based on monthly reinvestment
of dividends over a specified period of time.
From time to time the Funds may include in advertisements and other
communications information, charts, and illustrations relating to inflation and
the effects of inflation on the dollar, including the purchasing power of the
dollar at various rates of inflation. The Funds may also disclose from time to
time information about its portfolio allocation and holdings at a particular
date (including ratings of securities assigned by independent rating services
such as S&P and Moody's). The Funds may also depict the historical performance
of the securities in which the Funds may invest over periods reflecting a
variety of market or economic conditions either alone or in comparison with
alternative investments, performance indices of those investments, or economic
indicators. The Funds may also include in advertisements and in materials
furnished to present and prospective shareholders statements or illustrations
relating to the appropriateness of types of securities and/or mutual funds that
may be employed to meet specific financial goals, such as saving for retirement,
children's education, or other future needs.
- 26 -
<PAGE>
FINANCIAL STATEMENTS AND REPORTS
The books of the Funds will be audited at least once each year by independent
public accountants. Shareholders will receive annual audited and semiannual
(unaudited) reports when published and will receive written confirmation of all
confirmable transactions in their account. A copy of the Annual Report will
accompany the Statement of Additional Information ("SAI") whenever the SAI is
requested by a shareholder or prospective investor. The Financial Statements of
the Funds as of March 31, 1997, together with the report of the independent
accountants thereon, are included on the following pages.
- 27 -
<PAGE>
THE JAMESTOWN BOND FUND
No Load Mutual Fund
ANNUAL REPORT
March 31, 1997
Investment Adviser Administrator
LB&T STRATEGIC ADVISORS. INC. COUNTRYWIDE FUND SERVICES, INC.
6620 West Broad Street 312 Walnut Street
Suite 300 P.O. Box 5354
Richmond, Virginia 23230 Cincinnati, Ohio 45201-5354
1.804.288.0404 1.800.443.4249
<PAGE>
THE JAMESTOWN BOND FUND
MANAGEMENT DISCUSSION AND ANALYSIS
March 31, 1997
PERFORMANCE OF THE JAMESTOWN BOND FUND
FIRST QUARTER 1997
Chairman Greenspan was clearly in the spotlight this quarter - and with good
reason! The economy started the year on a roll and gained momentum throughout
the quarter, defying all expectations for a slowdown. With each monthly release
of statistics came fresh revisions of economists' forecasts for GDP growth and
renewed concerns about expectations for inflation. This did not go unnoticed by
Mr. Greenspan, who, in uncharacteristically clear text, took every opportunity
to warn the financial markets that a change in Federal Reserve policy was
imminent. Despite the warning, markets, both here and abroad, reacted negatively
to the 25 basis point increase that was announced as a result of the March 25th
FOMC meeting and investors sent both bond and stock prices tumbling just as the
quarter was ending. This was not an unusual event for bonds since yields had
generally been rising each month since the year began, causing the total return
of the Lehman Aggregate Index to be -0.56% and the return of the Govt/Corp Index
to be -0.86% for the quarter. Falling prices were quite unusual for stocks,
however, and the S&P 500 fell over 4% in March to end the quarter up only 2.7%.
Our interest rate disciplines kept us close to neutral during the quarter as
yields remained range bound. We started the year in the mid-point of the 6.35%
to 7.20% range and finished March toward the upper end of it, with little
opportunity for significant outperformance. Sectors also provided little
opportunity for outperformance as yield spreads versus Treasuries remained
narrow all quarter. Your portfolio did benefit from owning closed end funds,
however, as discounts narrowed and NAVs outperformed. Security selection,
especially in mortgages and asset-backed securities, was also a contributing
factor to outperformance.
FISCAL YEAR ENDED MARCH 31, 1997
The optimism that characterized the bond market at the beginning of the year
quickly faded as reports of strong economic growth and a declining unemployment
rate fueled concerns over rising inflation. As a result, bond prices fell and
yields rose dramatically. While most of this move occurred between mid-February
and mid-April, long Treasury yields, which began the year under 6%, peaked at
over 7% in early July. Inflation concerns proved unwarranted, however, as growth
moderated and wage gains remained subdued. A shrinking budget deficit and
inflows from foreign investors seeking higher yields than what was available in
their countries, also supported the U.S. bond market as yields fell about 60
basis points from their July peak by year-end. The domestic investment grade
market thus posted rather anemic returns for the year as the Lehman Brothers
Aggregate Index rose 3.6% and the Government/Corprate Index rose 2.9%. Investors
willing to assume high levels of risk were rewarded as junk bonds returned over
13% and emerging markets debt surged almost 40%.
During most of 1996, our interest rate disciplines kept portfolio durations near
neutral. Except for a brief time early in the year, there was little opportunity
for us or for any manager to impact performance significantly from duration
strategies. Corporates began the year with historically tight spreads and ended
the year with historically tight spreads. We maintained a cautious approach all
year, focusing on short maturities and a few special situations. We are pleased
that, despite underweighting the sector, we are able to capture essentially all
of the excess return in corporates with about one-half of the duration risk.
<PAGE>
LOOKING AHEAD
We have been here before. In fact, we were experiencing similar rates just nine
months ago, right before the market dropped between 50 and 75 basis points. What
is different this time around is that economic growth is clearly stronger, the
fears of impending inflation are clearly stronger, the dollar is stronger and
the Federal Reserve has already raised interest rates. What is similar is that
by most popular measures, inflation still has not appeared and pricing power is
most likely as limited now as it was then. We believe that the most recent rate
hike will be one of a few instead of one of many, and that there is an
opportunity developing in which having a duration longer than the Index will
result in outperformance. Our conviction in this belief is limited, however,
until we see evidence that the economy is cooling off or inflation is dormant.
As for sectors, we are somewhat frustrated by what we perceive as a lack of
opportunity in them right now, although we realize that this is only a temporary
condition. With the backup in interest rates and weakness in the stock market,
there has been some spread widening, or underperformance from corporates,
especially long maturing, weak credits; but not nearly enough to peak our
interest in them so late in this economic cycle. Mortgages appear to be only
fair value, but we have concentrated our holdings in discount coupons with the
added benefit of increased convexity. Within the asset-backed market, we have
identified manufactured housing as an attractive area. Credit quality is high
with these securities, and liquidity is increasing. They are also structured to
provide prepayment and average life stability, and we anticipate outperformance
from our overweighting in them. Closed end bond funds should continue to do
well, although we are lowering our expectations as their discounts narrow.
Although the bond market has not performed particularly well so far this year,
we do get excited about yields in excess of 7.00%. In our continual quest for
situations in which we believe reward outweighs risk, we see more value building
from maturity strategies than we do from sectors. We will look to our
disciplines to indicate when to buy the market.
The Jamestown Bond Fund
Comparison of the Change in Value of a $10,000 Investment in The Jamestown Bond
Fund, the Lehman Government/Corporate Index, the Lehman Aggregate Index and the
Consumer Price Index
<TABLE>
THE JAMESTOWN BOND FUND
LEHMAN BROTHERS GOVERNMENT THE JAMESTOWN BOND FUND:
CORPORATE INDEX:
<CAPTION>
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
<S> <C> <C> <C> <C> <C> <C>
12/31/90 10,000 12/31/90 10,000
03/31/91 2.52% 10,252 03/31/91 1.63% 10,163
06/30/91 1.78% 10,434 06/30/91 1.39% 10,305
09/30/91 4.77% 10,932 09/30/91 5.02% 10,822
12/31/91 5.33% 11,515 12/31/91 5.18% 11,382
03/31/92 -1.50% 11,342 03/31/92 -1.49% 11,213
06/30/92 4.06% 11,803 06/30/92 3.35% 11,588
09/30/92 4.88% 12,379 09/30/92 3.83% 12,033
12/31/92 0.07% 12,387 12/31/92 0.27% 12,065
03/31/93 4.66% 12,965 03/31/93 3.81% 12,524
06/30/93 3.01% 13,355 06/30/93 2.26% 12,807
09/30/93 3.32% 13,798 09/30/93 2.22% 13,091
12/31/93 -0.29% 13,758 12/31/93 0.25% 13,124
03/31/94 -3.15% 13,325 03/31/94 -2.55% 12,789
06/30/94 -1.24% 13,160 06/30/94 -1.04% 12,656
09/30/94 0.50% 13,225 09/30/94 0.51% 12,719
12/31/94 0.37% 13,274 12/31/94 0.26% 12,752
03/31/95 4.98% 13,935 03/31/95 4.87% 13,372
06/30/95 6.49% 14,840 06/30/95 5.87% 14,157
09/30/95 1.91% 15,123 09/30/95 2.45% 14,505
12/31/95 4.66% 15,828 12/31/95 4.49% 15,156
03/31/96 -2.34% 15,458 03/31/96 -1.86% 14,874
06/30/96 0.47% 15,530 06/30/96 0.82% 14,996
09/30/96 1.76% 15,804 09/30/96 1.84% 15,272
12/31/96 3.06% 16,287 12/31/96 3.29% 15,775
03/31/97 -0.86% 16,147 03/31/97 -0.50% 15,696
<CAPTION>
LEHMAN BROTHERS AGGREGATE INDEX: CONSUMER PRICE INDEX:
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
<S> <C> <C> <C> <C> <C>
12/31/90 10,000 12/31/90 10,000
03/31/91 2.81% 10,281 03/31/91 0.90% 10,090
06/30/91 1.62% 10,448 06/30/91 0.40% 10,130
09/30/91 5.68% 11,041 09/30/91 0.60% 10,191
12/31/91 5.07% 11,601 12/31/91 0.90% 10,283
03/31/92 -1.27% 11,453 03/31/92 0.70% 10,355
06/30/92 4.04% 11,916 06/30/92 0.80% 10,438
09/30/92 4.30% 12,429 09/30/92 0.70% 10,511
12/31/92 0.26% 12,461 12/31/92 0.80% 10,595
03/31/93 4.14% 12,977 03/31/93 0.90% 10,690
06/30/93 2.66% 13,322 06/30/93 0.60% 10,754
09/30/93 2.61% 13,670 09/30/93 0.40% 10,797
12/31/93 0.05% 13,676 12/31/93 0.70% 10,873
03/31/94 -2.87% 13,284 03/31/94 0.50% 10,927
06/30/94 -1.03% 13,147 06/30/94 0.60% 10,993
09/30/94 0.61% 13,227 09/30/94 0.90% 11,092
12/31/94 0.38% 13,278 12/31/94 0.60% 11,158
03/31/95 5.04% 13,947 03/31/95 0.80% 11,248
06/30/95 6.09% 14,796 06/30/95 0.90% 11,349
09/30/95 1.96% 15,086 09/30/95 0.40% 11,395
12/31/95 4.26% 15,729 12/31/95 0.50% 11,452
03/31/96 -1.77% 15,450 03/31/96 0.80% 11,544
06/30/96 0.57% 15,538 06/30/96 1.10% 11,671
09/30/96 1.85% 15,826 09/30/96 0.44% 11,723
12/31/96 3.00% 16,301 12/31/96 0.82% 11,819
03/31/97 -0.56% 16,209 03/31/97 0.69% 11,901
Past performance is not predictive of future performance.
The Jamestown Bond Fund Average Annual Total Returns
1 Year 5 Years Since Inception*
5.52% 6.96% 7.43%
* Initial offering of shares was December 13, 1990.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1997
<S> <C>
ASSETS
Investments in securities:
At acquisition cost $ 73,579,798
===============
At value (Note 1) $ 73,069,249
Investments in repurchase agreements (Note 1) 4,033,000
Cash 77
Receivable for securities sold 1,587,168
Interest receivable 743,228
Dividends receivable 2,683
Other assets 2,411
---------------
TOTAL ASSETS 79,437,816
---------------
LIABILITIES
Payable for securities purchased 2,868,614
Dividends payable 32,135
Accrued advisory fees (Note 3) 24,528
Accrued administration fees (Note 3) 4,800
Other accrued expenses 8,245
---------------
TOTAL LIABILITIES 2,938,322
---------------
NET ASSETS $ 76,499,494
===============
Net assets consist of:
Paid in capital $ 78,515,550
Accumulated net realized losses from security transactions (1,528,983)
Undistributed net investment income 23,476
Net unrealized depreciation on investments (510,549)
---------------
Net assets $ 76,499,494
===============
Shares of beneficial interest outstanding
(unlimited number of shares
authorized, no par value) 7,454,249
===============
Net asset value, offering price and redemption
price per share (Note 1) $ 10.26
===============
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN BOND FUND
STATEMENT OF OPERATIONS
Year Ended March 31, 1997
INVESTMENT INCOME
<S> <C>
Interest
$ 4,858,959
Dividends 533,969
---------------
TOTAL INVESTMENT INCOME 5,392,928
---------------
EXPENSES
Investment advisory fees (Note 3) 289,094
Administration fees (Note 3) 57,859
Custodian fees 19,740
Professional fees 14,287
Pricing costs 7,667
Insurance expense 5,485
Trustees' fees and expenses 5,002
Registration fees 2,704
Other expenses 8,065
---------------
TOTAL EXPENSES 409,903
Expenses reimbursed through a directed brokerage
arrangement (Note 4) (22,926)
---------------
NET EXPENSES 386,977
---------------
NET INVESTMENT INCOME 5,005,951
---------------
REALIZED AND UNREALIZED LOSSES ON INVESTMENTS
Net realized losses from security transactions (391,414)
Net change in unrealized appreciation/depreciation of
investments (405,910)
---------------
NET REALIZED AND UNREALIZED LOSSES ON INVESTMENTS (797,324)
---------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 4,208,627
===============
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
Years Ended March 31, 1997 and 1997
Year Year
Ended Ended
March 31, March 31,
1997 1996
-------------------- -------------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 5,005,951 $ 5,309,480
Net realized gains (losses) from security transactions (391,414) 3,596,533
Net change in unrealized appreciation/depreciation
on investments (405,910) (949,624)
------------------ ------------------
Net increase in net assets from operations 4,208,627 7,956,389
------------------ ------------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (5,104,234) (5,212,243)
------------------ ------------------
FROM CAPITAL SHARE TRANSACTIONS (a):
Proceeds from shares sold 9,262,915 16,330,832
Net asset value of shares issued in reinvestment
of distributions to shareholders 4,238,186 4,066,804
Payments for shares redeemed (10,880,119) (20,396,366)
Net increase in net assets from capital share transactions 2,620,982 1,270
TOTAL INCREASE IN NET ASSETS 1,725,375 2,745,416
NET ASSETS:
Beginning of year 74,774,119 72,028,703
------------------ ------------------
End of year - (including undistributed net investment
income of $23,476 and $121,759, respectively) $ 76,499,494 $ 74,774,119
------------------ ------------------
(a) Number of shares:
Sold 892,247 1,534,918
Reinvested 409,635 386,962
Redeemed (1,043,163) (1,951,756)
------------------ ------------------
Net increase (decrease) in shares outstanding 258,719 (29,876)
Shares outstanding, beginning of year 7,195,530 7,225,406
------------------ ------------------
Shares outstanding, end of year 7,454,249 7,195,530
================== ==================
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN BOND FUND
FINANCIAL HIGHLIGHTS
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year
Years Ended March 31,
--------------------------------------------------------
1997 1996 1995 1994 1993
-------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $10.39 $9.97 $10.15 $10.82 $10.42
-------- ------- -------- -------- --------
Income from investment operations:
Net investment income 0.68 0.70 0.62 0.55 0.64
Net realized and unrealized gains (losses) on investments (0.12) 0.41 (0.18) (0.30) 0.55
-------- ------- -------- -------- --------
Total from investment operations 0.56 1.11 0.44 0.25 1.19
-------- ------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.69) (0.69) (0.62) (0.55) (0.64)
Distributions from net realized gains -- -- -- (0.19) (0.15)
Distributions in excess of net realized gains -- -- -- (0.18) --
-------- ------- -------- -------- --------
Total distributions (0.69) (0.69) (0.62) (0.92) (0.79)
Net asset value at end of year $10.26 $10.39 $9.97 $10.15 $10.82
======== ======= ======== ======== ========
Total return 5.52% 11.23% 4.56% 2.12% 11.69%
======== ======= ======== ======== ========
Net assets at end of year (000's) $76,499 $74,774 $72,029 $64,029 $55,718
======== ======= ======== ======== ========
Ratio of expenses to average net assets (a) 0.53% 0.56% 0.53% 0.60% 0.59%
Ratio of net investment income to average net assets 6.48% 6.54% 6.28% 5.03% 6.09%
Portfolio turnover rate 207% 268% 381% 381% 454%
<FN>
(a) For the years ended March 31, 1997 and 1996, the ratio of expenses to
average net assets was determined based on gross expenses prior to
expense reimbursements through a directed brokerage arrangement. For
periods prior to March 31, 1996, the ratio was determined based on net
expenses after expense reimbursements through the directed brokerage
arrangement. Absent such expense reimbursements, the ratio of expenses to
average net assets would have been 0.57% for the year ended March 31,
1995 (Note 4).
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN BOND FUND
PORTFOLIO OF INVESTMENTS
March 31, 1997
Par Value Value
<S> <C> <C>
U.S. TREASURY AND AGENCY OBLIGATIONS - 26.0%
U.S. Treasury Bonds - 11.7%
$ 7,875,000 8.50%, due 02/15/2020 $ 8,975,059
---------------------
U.S. Treasury Notes - 14.3%
6,195,000 7.75%, due 11/30/1999 6,368,274
165,000 6.50%, due 05/31/2001 163,505
4,175,000 5.75%, due 08/15/2003 3,940,824
475,000 3.375%, due 01/15/2007 466,982
---------------------
10,939,585
---------------------
Total U.S. Treasury and Agency Obligations
(Cost $19,766,671) $ 19,914,644
---------------------
MORTGAGE-BACKED SECURITIES - 36.4%
Federal Home Loan Mortgage Corporation - 7.9%
$ 825,000 Pool #1655-HB, 6.50%, due 10/15/2008 $ 789,162
1,187,179 Pool #T-3-B1, 6.375, due 12/25/2010 1,143,403
950,000 Pool #1610-PE, 6.00%, due 04/15/2017 931,000
700,000 Pool #1699-TB, 6.00%, due 07/15/2022 614,026
80,744 Pool #D69139, 6.50%, due 03/01/2026 75,344
2,702,701 Pool #D70628, 6.50%, due 04/01/2026 2,521,945
---------------------
6,074,880
---------------------
Federal National Mortgage Association - 12.1%
2,125,000 Series #93-55-E, 6.20%, due 04/25/2005 2,097,099
495,177 Series #92-61-ZB, 7.50%, due 05/25/2007 481,248
804,252 Pool #267412, 5.50%, due 01/01/2009 743,990
1,128,905 Pool #368365, 5.50%, due 05/01/2009 1,043,876
600,000 Series #93-29-PE, 6.00%, due 11/25/2019 589,500
750,000 Series #90-63-H, 9.50%, due 06/25/2020 800,857
689,115 Series #G92-44-Z, 8.00%, due 07/25/2022 678,779
885,000 Series #G93-13-H, 6.00%, due 09/25/2022 777,411
650,000 Series #94-18-B, 6.75%, due 10/25/2022 599,417
761,178 Pool #67694, 6.085%, adjustable rate, due 10/01/2028 750,240
695,672 Pool #339016, 6.086%, adjustable rate, due 11/01/2035 685,676
--------------------
9,248,093
--------------------
Government National Mortgage Association - 10.4%
1,249,068 Pool #780215, 8.50%, due 10/15/2017 1,303,865
476,755 Pool #327273, 7.50%, due 08/15/2022 470,486
410,996 Pool #325612, 7.50%, due 10/15/2022 405,592
444,154 Pool #333658, 7.50%, due 01/15/2023 437,892
963,569 Pool #342526, 7.50%, due 02/15/2023 949,982
1,128,021 Pool #349314, 7.50%, due 02/15/2023 1,112,116
853,797 Pool #352143, 7.50%, due 07/15/2023 841,758
872,823 Pool #372822, 7.50%, due 11/15/2023 860,516
1,088,626 Pool #359451, 7.50%, due 12/15/2023 1,073,276
469,553 Pool #354831, 7.50%, due 06/15/2024 462,492
-------------------
7,917,975
-------------------
<PAGE>
<CAPTION>
Par Value Value
<S> <C> <C>
Other Mortgage-Backed Securities - 6.0%
Chase Commercial Mortgage Securities Corporation #96-1-A1,
$ 845,359 7.60%, due 12/18/2005 $ 857,511
FDIC REMIC Trust #96-C1-1A,
477,457 6.75%, due 05/25/2026 469,998
Lehman Brothers Mortgage Trust #91-2-A1,
753,547 8.00%, due 03/20/1999 763,909
Morgan Stanley Capital #97-C1-A1B,
890,000 7.46%, due 02/15/2020 895,841
Multi-Family Capital Access One, Inc. #1-A,
880,348 6.65%, due 01/15/2024 822,025
Resolution Funding Mortgage Security I #94-S12-A2,
800,000 6.50%, due 04/25/2009 785,744
--------------------
4,595,028
--------------------
Total Mortgage-Backed Securities (Cost $28,328,624) $ 27,835,976
---------------------
ASSET-BACKED SECURITIES - 8.0%
BankAmerica Manufactured Housing Contract #96-1-A6,
$ 650,000 8.00%, due 10/10/2026 $ 651,300
CIT RV Trust #95-B-A1,
346,391 6.50%, due 04/15/2011 344,971
CIT RV Trust #96-A-A1,
858,697 5.40%, due 12/15/2011 842,726
Contimortgage Home Equity Loan Trust #95-4-A3,
1,061,942 6.20%, due 10/15/2010 1,060,774
Fleetwood Credit Corporation Grantor Trust #94-A-A,
620,491 4.70%, due 07/15/2009 597,607
Fleetwood Credit Corporation Grantor Trust #96-A-A,
626,185 6.75%, due 10/15/2011 623,931
Green Tree Financial Corporation, #96-8-A7,
1,275,000 8.05%, due 10/15/2027 1,295,719
Green Tree Financial Corporation, #97-2-A7,
700,000 7.62%, due 04/15/2028 687,820
---------------------
Total Asset-Backed Securities (Cost $6,188,209) $ 6,104,848
---------------------
CORPORATE BONDS - 16.6%
Allmerica Financial Corporation,
$ 375,000 7.625%, due 10/15/2025 $ 355,087
Associates Corporation,
700,000 5.75%, due 10/15/2003 644,539
Baltimore Gas & Electric Corporation,
1,000,000 8.90%, due 07/01/1998 1,027,580
Beneficial Corporation Medium Term Notes,
900,000 8.27%, due 11/30/1998 923,139
Ford Motor Credit Medium Term Note,
950,000 7.45%, due 04/13/2000 963,281
<PAGE>
<CAPTION>
Par Value Value
<S> <C> <C>
CORPORATE BONDS - Continued
General Motors Acceptance Corporation Medium Term Notes,
$ 1,725,000 6.65%, due 05/24/2000 $ 1,709,510
International Lease Finance Medium Term Notes,
1,315,000 6.42%, due 09/11/2000 1,291,396
Lehman Brothers Holdings,
1,850,000 6.40%, due 12/27/1999 1,821,417
May Department Stores Company,
950,000 7.45%, due 09/15/2011 930,145
Mellon Financial Company,
915,000 7.625%, due 11/15/1999 930,454
Morgan Stanley Group,
690,000 6.875%, due 03/01/2007 658,281
Nationwide Financial Services,
725,000 8.00%, due 03/01/2027 703,127
Sears Roebuck & Company,
750,000 6.86%, due 07/03/2001 743,250
---------------------
Total Corporate Bonds (Cost $12,812,630) $ 12,701,206
---------------------
Shares
CLOSED-END MUTUAL FUNDS - 8.5%
13,400 Blackrock 1999 Term Trust, Inc. $ 118,925
162,200 Blackrock 2001 Term Trust, Inc. 1,297,600
1,500 Blackrock Broad Investment Grade 2009 Term Trust, Inc. 16,875
53,900 Blackrock Investment Quality Term Trust, Inc. 417,725
100,300 Blackrock Strategic Term Trust, Inc. 789,862
12,000 Dean Witter Government Inc. Trust 97,500
7,400 Excelsior Income Shares, Inc. 115,625
16,800 Hyperion 1997 Term Trust, Inc. 119,700
137,200 Hyperion 1999 Term Trust, Inc. 874,650
164,200 Hyperion 2002 Term Trust, Inc. 1,190,450
51,300 Hyperion 2005 Investment Grade Opportunity Term Trust, Inc. 378,338
36,400 Income Opportunities Fund, Inc. - 1999 327,600
9,900 Kemper Intermediate Government Trust 71,775
3,600 Liberty Term Trust, Inc. - 1999 28,350
28,900 MFS Government Markets Income Trust 187,850
16,000 MFS Intermediate Income Trust 110,000
51,000 Putnam Intermediate Government Trust 369,750
---------------------
Total Closed-End Funds (Cost $6,483,664) $ 6,512,575
---------------------
Total Investments at Value (Cost $73,579,798) - 95.5% $ 73,069,249
---------------------
<CAPTION>
Face
Amount Value
<S> <C> <C>
REPURCHASE AGREEMENTS (a) - 5.3%
Star Bank, N.A., 5.25%, dated 03/31/1997, due 04/01/1997
$ 4,033,000 repurchase proceeds $4,033,588 (Cost $4,033,000) $ 4,033,000
---------------------
Total Investments and Repurchase Agreements
at Value - 100.8% $ 77,102,249
Liabilities in Excess of Other Assets - (.8)% (602,755)
---------------------
Net Assets - 100.0% $ 76,499,494
---------------------
<FN>
(a) Joint repurchase agreement is fully collateralized by $20,650,000 GNMA II,
Pool #8373, 6.50%, due 02/20/2 The aggregate market value of the collateral
at March 31, 1997 was $20,897,370. The Fund's pro-rata inte in the
collateral at March 31, 1997 was $4,378,590.
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
THE JAMESTOWN BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
1. SIGNIFICANT ACCOUNTING POLICIES
The Jamestown Bond Fund (the Fund) is a no-load, diversified series of the
Williamsburg Investment Trust (the Trust), an open-end management investment
company registered under the Investment Company Act of 1940, as amended. The
Trust was organized as a Massachusetts business trust on July 18, 1988. The Fund
began operations on December 13, 1990.
The Fund's investment objective is to maximize total return, consisting of
current income and capital appreciation (both realized and unrealized),
consistent with the preservation of capital through active management of
investment grade fixed income securities.
The following is a summary of the Fund's significant accounting policies:
Securities valuation -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(currently 4:00 p.m., Eastern time). Securities which are traded
over-the-counter are valued at the last sales price, if available, otherwise, at
the last quoted bid price. Securities traded on a national exchange are valued
based upon the closing price on the principal exchange where the security is
traded. It is expected that fixed income securities of the Fund will ordinarily
be traded on the over-the-counter market. When market quotations are not readily
available, securities may be valued on the basis of prices provided by an
independent pricing service. If a pricing service cannot provide a valuation,
securities will be valued in good faith at fair market value using methods
consistent with those determined by the Board of Trustees.
Repurchase agreements -- The Fund generally enters into joint repurchase
agreements with other funds within the Trust. The joint repurchase agreement,
which is collateralized by U.S. Government obligations, is valued at cost which,
together with accrued interest, approximates market. At the time the Fund enters
into the joint repurchase agreement, the seller agrees that the value of the
underlying securities, including accrued interest, will at all times be equal to
or exceed the face amount of the repurchase agreement. In addition, the Fund
actively monitors and seeks additional collateral, as needed.
Share valuation -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
of the Fund is equal to the net asset value per share.
Investment income and distributions to shareholders -- Dividend income is
recorded on the ex-dividend date. Interest income is accrued as earned.
Discounts and premiums on securities purchased are amortized in accordance with
income tax regulations. Dividends arising from net investment income are
declared and paid quarterly to shareholders of the Fund. Net realized short-term
capital gains, if any, may be distributed throughout the year and net realized
long-term capital gains, if any, are distributed at least once each year. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations, which may differ from generally accepted accounting
principles.
Security transactions -- Security transactions are accounted for on trade date.
Securities sold are valued on a specific identification basis.
<PAGE>
THE JAMESTOWN BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
Securities traded on a "to-be-announced" basis -- The Fund occasionally trades
securities on a "to-be-announced" (TBA) basis. In a TBA transaction, the Fund
has committed to purchase securities for which all specific information is not
yet known at the time of the trade, particularly the face amount in
mortgage-backed securities transactions. Securities purchased on a TBA basis are
not settled until they are delivered to the Fund, normally 15 to 45 days later.
These transactions are subject to market fluctuations and their current value is
determined in the same manner as for other portfolio securities.
Estimates -- The preparation of financial statements in conformity with
generally accepted accounting priciples requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is the Fund's policy to comply with the special
provisions of the Internal Revenue Code applicable to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies
and distributes at least 90% of its taxable net income, the Fund (but not the
shareholders) will be relieved of federal income tax on the income distributed.
Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is based upon the federal income tax cost of portfolio
investments of $73,668,177 as of March 31, 1997:
Gross unrealized appreciation............. $ 473,437
Gross unrealized depreciation.............. (1,072,365)
-----------
Net unrealized depreciation............... $ (598,928)
===========
As of March 31, 1997, the Fund had capital loss carryforwards for federal income
tax purposes of $1,440,604 which expire on March 31, 2004. These capital loss
carryforwards may be utilized in the current and future years to offset net
realized capital gains prior to distributing such gains to shareholders.
2. INVESTMENT TRANSACTIONS
During the year ended March 31, 1997, purchases and proceeds from sales and
maturities of investment securities, other than short-term investments, amounted
to $151,729,558 and $152,600,144, respectively.
<PAGE>
THE JAMESTOWN BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Fund's investments are managed by LB&T Strategic Advisors, Inc. (the
Advisor), formerly Lowe, Brockenbrough & Tattersall, Inc., under the terms of an
Investment Advisory Agreement. Under the Investment Advisory Agreement, the Fund
pays the Advisor a fee, which is computed and accrued daily and paid monthly at
an annual rate of .375% of its average daily net assets. Certain trustees and
officers of the Trust are also officers of the Advisor.
ADMINISTRATIVE SERVICES AGREEMENT
Under the terms of an Administrative Services Agreement with the Trust,
Countrywide Fund Services, Inc., (CFS), formerly MGF Service Corp., provides
administrative, pricing, accounting, dividend disbursing, shareholder servicing
and transfer agent services for the Fund. For these services, CFS receives a
monthly fee from the Fund at an annual rate of .075% of its average daily net
assets up to $200 million and .05% of such net assets in excess of $200 million,
subject to a $2,000 minimum monthly fee. In addition, the Fund pays
out-of-pocket expenses including, but not limited to, postage, supplies, and
cost of pricing the Fund's portfolio securities. Certain officers of the Trust
are also officers of CFS.
4. DIRECTED BROKERAGE ARRANGEMENT
In order to reduce the total operating expenses of the Fund, a portion of the
Fund's custodian fees have been paid through an arrangement with a third-party
broker-dealer who is compensated through security trades. Expenses reimbursed
through the directed brokerage arrangement totaled $22,926 for the year ended
March 31, 1997.
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees
The Williamsburg Investment Trust
Cincinnati, Ohio
We have audited the accompanying statement of assets and liabilities of
The Jamestown Bond Fund (a series of The Williamsburg Investment Trust),
including the portfolio of investments, as of March 31, 1997, and the related
statement of operations for the year then ended, the statement of changes in net
assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1997 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of The Jamestown Bond Fund as of March 31, 1997, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the five years in the period then ended, in conformity with generally accepted
accounting principles.
Tait, Weller & Baker
Philadelphia, Pennsylvania
April 25, 1997
<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
No Load Mutual Fund
ANNUAL REPORT
March 31, 1997
Investment Adviser Administrator
LB&T STRATEGIC ADVISORS, INC. COUNTRYWIDE FUND SERVICES, INC.
6620 West Broad Street 312 Walnut Street
Suite 300 P.O. Box 5354
Richmond, Virginia 23230 Cincinnati, Ohio 45201-5354
1.804.288.0404 1.800.443.4249
<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
MANAGEMENT DISCUSSION AND ANALYSIS
March 31, 1997
PERFORMANCE OF THE JAMESTOWN SHORT TERM BOND FUND
FIRST QUARTER 1997
Chairman Greenspan was clearly in the spotlight this quarter - and with good
reasoning! The economy started the year on a roll and gained momentum throughout
the quarter, defying all expectations for a slowdown. With each monthly release
or statistics came fresh revisions of economists' forecasts for GDP growth and
renewed concerns about expectations for inflation. This did not go unnoticed by
Mr. Greenspan, who, in uncharacteristically clear text, took every opportunity
to warn the financial markets that a change in Federal Reserve policy was
imminent. Despite the warning, markets, both here and abroad, reacted negatively
to the 25 basis point increase that was announced as a result of the March 25th
FOMC meeting and investors sent both bond and stock prices tumbling just as the
quarter was ending. This was not an unusual event for bonds since yields had
generally been rising each month since the year began, causing the total return
of Treasury Bills to have the highest return along the yield curve at 1.30%.
Falling prices were quite unusual for stocks, however, and the S&P 500 fell over
4% in March to end the quarter up only 2.7%.
Our interest rates disciplines kept us slightly longer with a 0.75 year average
maturity during the quarter as yields remained range bound. We started the year
in the mid-point of the 4.90% to 5.40% range and finished March toward the upper
end of it, with little opportunity for significant outperformance. Sectors also
provided little opportunity for outperformance as yield spreads versus
Treasuries remained narrow all quarter.
FISCAL YEAR ENDED MARCH 31, 1997
The optimism that characterized the bond market at the beginning of the year
quickly faded as reports of strong economic growth and a declining unemployment
rate fueled concerns over rising inflation. As a result, bond prices fell and
yields rose. Treasury Bills started the year yielding 5.06%, peaked in early
September at 5.35% before closing 1996 at 5.17%. Yields of longer maturities
were even more volatile. Inflation concerns proved unwarranted, however, as
growth moderated and wage gains remained subdued. A shrinking budget deficit and
inflows from foreign investors seeking higher yields than what was available in
their countries, also supported the U.S. bond market as yields fell about 60
basis points from their July peak by the end of 1996. Anchored by a stable
Federal Funds rate, Treasury Bill yields traded in a narrow range of 4.9% to
5.4% throughout 1996 and provided a total return of 5.35%.
During most of 1996, our interest rate disciplines kept portfolio durations near
neutral. Except for a brief time early in the year, there was little opportunity
for us or for any manager to impact performance significantly from duration
strategies. This is especially true for portfolios benchmarked to a short term
index. Corporates began the year with historically tight spreads and ended the
year with historically tight spreads. The advantage from owning corporates this
year, therefore, was attributable to their extra yield.
<PAGE>
LOOKING AHEAD
We have been here before. In fact, we were experiencing similar rates just nine
months ago, right before the market dropped between 50 and 75 basis points. What
is different this time around is that economic growth is clearly stronger, the
fears of impending inflation are clearly stronger, the dollar is stronger and
the Federal Reserve has already raised interest rates. What is similar is that
by most popular measures, inflation still has not appeared and pricing power is
most likely as limited now as it was then. We believe that the most recent rate
hike will be one of a few instead of one of many, and that there is an
opportunity developing in which having a duration longer than the Index will
result in outperformance. Our conviction in this belief is limited, however,
until we see evidence that the economy is cooling off or inflation is dormant.
As for sectors, we are somewhat frustrated by what we perceive as a lack of
opportunity in them right now, although we realize that this is only a temporary
condition. With the backup in interest rates and weakness in the stock market,
there has been some spread widening, or underperformance from Corporates,
especially long maturing, weak credits; but not nearly enough to peak our
interest in them so late in this economic cycle. Mortgages appear to be only
fair value, but we have concentrated our holdings in discount coupons with the
added benefit of increased convexity. Closed end bond funds should continue to
do well, although we are lowering our expectations as their discounts narrow.
Although the bond market has not performed particularly well so far this year,
we do get excited abut real short term yields in excess of 3.00%. In our
continual quest for situations in which we believe reward outweighs risk, we see
more value building from maturity strategies than we do from sectors. We will
look to our disciplines to indicate when to buy the market.
The Jamestown Short Term Bond Fund
Comparison of the Change in Value of a $10,000 Investment in The Jamestown
Short Term Bond Fund, the Merrill Lynch 1-3 Year Treasury Index, the 90-Day
Treasury Bill Index and the Consumer Price Index
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
MERRILL LYNCH 1-3 YEAR TREASURY INDEX: THE JAMESTOWN SHORT TERM
BOND FUND:
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
<S> <C> <C> <C> <C> <C>
01/31/92 10,000 01/31/92 10,000
03/31/92 0.31% 10,031 03/31/92 0.25% 10,025
06/30/92 2.88% 10,319 06/30/92 2.03% 10,229
09/30/92 2.98% 10,627 09/30/92 2.14% 10,448
12/31/92 0.18% 10,646 12/31/92 0.15% 10,463
03/31/93 2.21% 10,882 03/31/93 1.95% 10,667
06/30/93 1.08% 10,999 06/30/93 1.27% 10,803
09/30/93 1.44% 11,157 09/30/93 1.34% 10,947
12/31/93 0.59% 11,222 12/31/93 0.61% 11,015
03/31/94 -0.50% 11,166 03/31/94 -0.48% 10,962
06/30/94 0.08% 11,176 06/30/94 0.23% 10,987
09/30/94 0.99% 11,286 09/30/94 0.93% 11,090
12/31/94 0.00% 11,286 12/31/94 -0.05% 11,084
03/31/95 3.36% 11,665 03/31/95 3.38% 11,458
06/30/95 3.21% 12,039 06/30/95 3.01% 11,803
09/30/95 1.50% 12,220 09/30/95 1.33% 11,960
12/31/95 2.52% 12,528 12/31/95 2.62% 12,273
03/31/96 0.33% 12,570 03/31/96 0.25% 12,304
06/30/96 1.01% 12,696 06/30/96 0.77% 12,399
09/30/96 1.65% 12,906 09/30/96 1.56% 12,592
12/31/96 1.90% 13,151 12/31/96 1.56% 12,788
03/31/97 0.66% 13,239 03/31/97 1.04% 12920.45
<CAPTION>
CONSUMER PRICE INDEX: 90-DAY TREASURY BILL INDEX:
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
<S> <C> <C> <C> <C> <C>
01/31/92 10,000 01/31/92 10,000
03/31/92 0.40% 10,040 03/31/92 0.64% 10,064
06/30/92 0.80% 10,120 06/30/92 1.10% 10,174
09/30/92 0.70% 10,191 09/30/92 1.01% 10,277
12/31/92 0.80% 10,273 12/31/92 0.77% 10,357
03/31/93 0.90% 10,365 03/31/93 0.78% 10,437
06/30/93 0.60% 10,427 06/30/93 0.77% 10,518
09/30/93 0.40% 10,469 09/30/93 0.82% 10,604
12/31/93 0.70% 10,542 12/31/93 0.78% 10,687
03/31/94 0.50% 10,595 03/31/94 0.77% 10,768
06/30/94 0.60% 10,659 06/30/94 0.96% 10,872
09/30/94 0.90% 10,755 09/30/94 1.08% 10,989
12/31/94 0.60% 10,819 12/31/94 1.33% 11,135
03/31/95 0.80% 10,906 03/31/95 1.50% 11,302
06/30/95 0.90% 11,004 06/30/95 1.50% 11,472
09/30/95 0.40% 11,048 09/30/95 1.42% 11,635
12/31/95 0.50% 11,104 12/31/95 1.47% 11,806
03/31/96 0.80% 11,193 03/31/96 1.23% 11,951
06/30/96 1.10% 11,316 06/30/96 1.29% 12,105
09/30/96 0.44% 11,366 09/30/96 1.38% 12,273
12/31/96 0.82% 11,460 12/31/96 1.30% 12,433
03/31/97 0.69% 11,539 03/31/97 1.28% 12,591
Past performance is not predictive of future performance
The Jamestown Short Term Bond Fund Average Annual Total returns
1 Year 1 Years Since Inception*
5.01% 5.21% 5.04%
* Initial public offering of shares was January 21, 1992.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1997
<S> <C>
ASSETS
Investments in securities:
At acquisition cost $ 9,115,914
================
At value (Note 1) $ 9,064,978
Investments in repurchase agreements (Note 1) 767,000
Cash 156
Receivable from securities sold 7,738
Interest receivable 86,289
Due from Adviser (Note 3) 966
Other assets 351
----------------
TOTAL ASSETS 9,927,478
================
LIABILITIES
Accrued administration fees 2,000
Other accrued expenses 1,000
----------------
TOTAL LIABILITIES 3,000
----------------
NET ASSETS $ 9,924,478
================
Net assets consist of:
Paid-in capital $ 10,519,030
Accumulated net realized losses from security transactions (546,248)
----------------
Undistributed net investment income 2,632
Net unrealized depreciation on investments (50,936)
----------------
Net assets $ 9,924,478
================
Shares of beneficial interest outstanding (unlimited number of shares
authorized, no par value) 1,032,909
================
Net asset value, offering price and redemption price per share (Note 1) $ 9.61
================
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
STATEMENT OF OPERATIONS
Year Ended March 31, 1997
<S> <C>
INVESTMENT INCOME
Interest $ 630,476
----------------
EXPENSES
Investment advisory fees (Note 3) 36,481
Administration fees (Note 3) 24,000
Professional fees 10,788
Custodian fees 6,387
Trustees' fees and expenses 5,002
Pricing costs 3,697
Printing of shareholder reports 1,496
Registration fees 1,185
Insurance expense 1,143
Other expenses 1,808
----------------
TOTAL EXPENSES 91,987
Fees waived and expenses reimbursed by the Adviser (Note 3) (43,345)
----------------
NET EXPENSES 48,642
----------------
NET INVESTMENT INCOME 581,834
----------------
REALIZED AND UNREALIZED LOSSES ON INVESTMENTS
Net realized losses from security transactions (101,843)
Net change in unrealized appreciation/depreciation on investments (3,365)
----------------
NET REALIZED AND UNREALIZED LOSSES ON INVESTMENTS (105,208)
----------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 476,626
================
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
Years Ended March 31, 1997 and 1996
Year Year
Ended Ended
March 31, March 31,
1997 1996
-------------- --------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 581,834 $ 790,385
Net realized gains (losses) from security transactions (101,843) 192,225
Net change in unrealized appreciation/depreciation
on investments (3,365) (10,516)
-------------- --------------
Net increase in net assets from operations 476,626 972,094
-------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (582,861) (793,655)
-------------- --------------
FROM CAPITAL SHARE TRANSACTIONS (a):
Proceeds from shares sold 2,203,737 2,046,872
Net asset value of shares issued in reinvestment
of distributions to shareholders 582,861 563,410
Payments for shares redeemed (2,181,641) (7,485,406)
-------------- --------------
Net increase (decrease) in net assets from capital share transact 604,957 (4,875,124)
-------------- --------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 498,722 (4,696,685)
NET ASSETS:
Beginning of year 9,425,756 14,122,441
-------------- --------------
End of year - (including undistributed net investment
income of $2,632 and $3,659, respectively) $ 9,924,478 $ 9,425,756
(a)Number of Shares:
Sold 226,810 208,453
Reinvested 60,494 57,652
Redeemed (224,329) (761,014)
-------------- --------------
Net increase (decrease) in shares outstanding 62,975 (494,909)
Shares outstanding, beginning of year 969,934 1,464,843
-------------- --------------
Shares outstanding, end of year 1,032,909 969,934
============== ==============
<FN>
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
FINANCIAL HIGHLIGHTS
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year
Years Ended March 31,
--------------------------------------------------------------
1997 1996 1995 1994 1993
------ ----- ----- ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $9.72 $9.64 $9.82 $10.07 $9.93
------ ------ ----- ------ ------
Income from investment operations:
Net investment income 0.58 0.62 0.60 0.51 0.50
Net realized and unrealized gains (losses)
on investments (0.11) 0.08 (0.17) (0.23) 0.13
------ ------ ----- ------ ------
Total from investment operations 0.47 0.70 0.43 0.28 0.63
------ ------ ----- ------ ------
Less distributions:
Dividends from net investment income (0.58) (0.62) (0.61) (0.51) (0.49)
Distributions from net realized gains (0.02) --
------ ------ ----- ------ ------
Total distributions (0.58) (0.62) (0.61) (0.53) (0.49)
------ ------ ----- ------ ------
Net asset value at end of year $9.61 $9.72 $9.64 $9.82 $10.07
====== ====== ===== ====== ======
Total return 5.01% 7.38% 4.53% 2.76% 6.40%
Net assets at end of year (000's) $9,924 $9,426 $14,122 $18,715 $15,580
Ratio of expenses to average net assets (a) 0.50% 0.50% 0.50% 0.50% 0.50%
Ratio of net investment income to average net assets 5.96% 6.27% 6.04% 5.22% 5.24%
Portfolio turnover rate 62% 157% 144% 324% 289%
<FN>
(a)Absent investment advisory fees waived and expenses reimbursed by the Adviser,
the ratios of expenses to average net assets
0.85%, 0.85%, 0.81%, and 0.82% for the years ended
March 31, 1997, 1996, 1995, 1994, and 1993, respectively (Note 3).
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE JAMESTOWN SHORT TERM BOND FUND
PORTFOLIO OF INVESTMENTS
March 31, 1997
Par Value Value
<S> <C> <C>
COMMERCIAL PAPER - 39.5%
$ 400,000 American Express Company, due 07/15/1997 $ 393,875
400,000 American General Financial, due 06/17/1997 395,380
400,000 AT&T Corporation, due 10/16/1997 387,856
400,000 E. I. DuPont de Nemours & Company, due 08/14/1997 392,155
400,000 Lucent Technologies, Inc., due 08/19/1997 391,724
375,000 McMcormick Capital, Inc., 08/22/1997 367,031
400,000 Prudential Funding Corporation, due 05/14/1997 397,496
400,000 United Parcel Service of America, Inc., due 04/24/1997 398,651
400,000 The Walt Disney Company, due 04/10/1997 399,471
400,000 Xerox Corporation, due 05/23/1997 396,967
-----------
Total Commercial Paper (Cost $3,920,606) $ 3,920,606
-----------
U.S. TREASURY AND AGENCY OBLIGATIONS - 18.9%
U.S. Treasury Notes - 14.6%
$ 200,000 5.125%, due 04/30/1998 $ 197,938
1,215,000 7.75%, due 11/30/1999 1,248,983
-----------
1,446,921
-----------
Student Loan Marketing Association - 4.3 %
425,000 5.71%, floating rate, due 02/17/1998 425,786
-----------
Total U.S. Treasury and Agency Obligations (Cost $1,890,247$ 1,872,707
-----------
MORTGAGE-BACKED SECURITIES - 14.0%
Federal Home Loan Mortgage Corporation - 3.0%
$ 175,000 Series #1272-D, 7.50%, due 11/15/2005 $ 177,242
122,956 Series #162-E, 7.00%, due 02/15/2020 122,956
300,198
Federal National Mortgage Association - 4.4%
225,000 Series #91-131-E, 7.709%, due 10/25/1998 227,531
202,207 Pool #124029, 8.00%, due 12/01/2002 204,312
-----------
431,843
-----------
Other Mortgage-Backed Securities - 6.6%
Lehman Brothers Mortgage Trust #91-2-A1,
113,944 8.00%, due 03/20/1999 115,511
CMC Securities Corporation #93-E-S4,
400,000 5.75%, due 11/25/2008 395,500
GE Capital Mortgage Services, Inc. #93-4A-A1,
148,860 6.3875%, floating rate, due 03/25/2023 149,556
-----------
660,567
-----------
Total Mortgage-Backed Securities (Cost $1,400,770) $ 1,392,608
-----------
<PAGE>
<CAPTION>
Par Value Value
<S> <C>
ASSET-BACKED SECURITIES - 3.2%
CIT RV Trust #96-A-A1,
$ 321,078 5.40%, due 12/15/2011 $ 315,106
-----------
Total Asset-Backed Securities (Cost $317,165) $ 315,106
-----------
CORPORATE BONDS - 15.8%
Beneficial Corporation Medium Term Notes,
$ 400,000 8.27%, due 11/30/1998 $ 410,284
Ford Motor Credit Corporation,
40,000 8.00%, due 12/01/1997 40,443
International Bank Reconstruction and Development,
265,000 5.10%, due 09/15/1999 255,866
Mellon Financial Corporation,
375,000 6.50%, due 12/01/1997 375,409
J.C. Penny & Company,
300,000 10.00%, due 10/15/1997 305,832
Xerox Corporation Medium Term Notes,
175,000 7.13%, due 04/30/1999 176,117
-----------
Total Corporate Bonds (Cost $1,587,126) $ 1,563,951
-----------
Total Investments at Value (Cost $9,115,914) - 91.4% $ 9,064,978
-----------
<CAPTION>
Face
Amount
<S> <C> <C>
REPURCHASE AGREEMENTS (a) - 7.7%
$ 767,000 Star Bank, N.A., 5.25%, dated 03/31/1997, due 04/01/1997
repurchase proceeds $767,112 (Cost $767,000) $ 767,000
-----------
Total Investments and Repurchase Agreements
at Value - 99.1% $ 9,831,978
Other Assets in Excess of Liabilities - .9% 92,500
-----------
Net Assets - 100.0% $ 9,924,478
===========
<FN>
(a) Joint repurchase agreement is fully collaterized by $20,650,000 GNMA
II, Pool #8373, 6.50%, due 02/20/2024. The aggregate market value of the
collateral at March 31, 1997 was $20,897,370. The Fund's pro-rata interest in
the collateral at March 31, 1997 was $832,725.
See accompanying notes to the financial statements.
</FN>
</TABLE>
<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
1. SIGNIFICANT ACCOUNTING POLICIES
The Jamestown Short Term Bond Fund (the Fund) is a no-load, diversified series
of the Williamsburg Investment Trust (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Trust was organized as a Massachusetts business trust on July 18,
1988. The Fund began operations on January 21, 1992.
The Fund's investment objective is to maximize total return, consisting of
current income and capital appreciation (both realized and unrealized),
consistent with the preservation of capital through active management of high
quality short-term fixed income securities.
The following is a summary of the Fund's significant accounting policies:
Securities valuation -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(currently 4:00 p.m., Eastern time). Securities which are traded
over-the-counter are valued at the last sales price, if available, otherwise, at
the last quoted bid price. Securities traded on a national exchange are valued
based upon the closing price on the principal exchange where the security is
traded. It is expected that securities of the Fund will ordinarily be traded on
the over-the-counter market. When market quotations are not readily available,
securities may be valued on the basis of prices provided by an independent
pricing service. If a pricing service cannot provide a valuation, securities
will be valued in good faith at fair market value using methods consistent with
those determined by the Board of Trustees.
Repurchase agreements -- The Fund generally enters into joint repurchase
agreements with other funds within the Trust. The joint repurchase agreement,
which is collateralized by U.S. Government obligations, is valued at cost which,
together with accrued interest, approximates market. At the time the Fund enters
into the joint repurchase agreement, the seller agrees that the value of the
underlying securities, including accrued interest, will at all times be equal to
or exceed the face amount of the repurchase agreement. In addition, the Fund
actively monitors and seeks additional collateral, as needed.
Share valuation -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
of the Fund is equal to the net asset value per share.
Investment income and distributions to shareholders -- Interest income is
accrued as earned. Discounts and premiums on securities purchased are amortized
in accordance with income tax regulations. Dividends arising from net investment
income are declared and paid quarterly to shareholders of the Fund. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. Income distributions and capital gain distributions are determined in
accordance with income tax regulations, which may differ from generally accepted
accounting principles.
Security transactions -- Security transactions are accounted for on trade date.
Securities sold are valued on a specific identification basis.
<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
Securities traded on a "to-be-announced" basis -- The Fund occasionally trades
securities on a "to-be-announced" (TBA) basis. In a TBA transaction, the Fund
has committed to purchase securities for which all specific information is not
yet known at the time of the trade, particularly the face amount in
mortgage-backed securities transactions. Securities purchased on a TBA basis are
not settled until they are delivered to the Fund, normally 15 to 45 days later.
These transactions are subject to market fluctuations and their current value is
determined in the same manner as for other portfolio securities.
Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is the Fund's policy to comply with the special
provisions of the Internal Revenue Code applicable to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies
and distributes at least 90% of its taxable net income, the Fund (but not the
shareholders) will be relieved of federal income tax on the income distributed.
Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is based upon the federal income tax cost of portfolio
investments of the Fund as of March 31, 1997:
Gross unrealized appreciation.................. $ 23,256
Gross unrealized depreciation................... (74,192)
----------
Net unrealized depreciation....................$ (50,936)
==========
The tax basis of investments of the Fund is equal to the acquisition cost as
shown on the Statement of Assets and Liabilities. As of March 31, 1997, the Fund
had capital loss carryforwards for federal income tax purposes of $508,929 which
expire on March 31, 2004. In addition, the Fund had net realized capital losses
of $37,319 during the period from November 1, 1996 through March 31, 1997, which
are treated for federal income tax purposes as arising during the Fund's tax
year ending March 31, 1998. These capital loss carryforwards and "post-October"
losses may be utilized in the current and future years to offset net realized
capital gains prior to distributing such gains to shareholders.
2. INVESTMENT TRANSACTIONS
During the year ended March 31, 1997, purchases and proceeds from sales and
maturities of investment securities, other than short-term investments, amounted
to $3,952,270 and $8,238,064, respectively.
<PAGE>
THE JAMESTOWN SHORT TERM BOND FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Fund's investments are managed by LB&T Strategic Advisors, Inc. (the
Advisor), formerly Lowe, Brockenbrough & Tattersall, Inc., under the terms of an
Investment Advisory Agreement. Under the Investment Advisory Agreement, the Fund
pays the Advisor a fee, which is computed and accrued daily and paid monthly at
an annual rate of .375% of its average daily net assets. The Advisor currently
intends to limit the total operating expenses of the Fund to .50% of its average
daily net assets; accordingly, the Advisor waived its entire investment advisory
fee of $36,481 and reimbursed the Fund for $6,864 of other operating expenses
for the year ended March 31, 1997. Certain trustees and officers of the Trust
are also officers of the Advisor.
ADMINISTRATIVE SERVICES AGREEMENT
Under the terms of an Administrative Services Agreement with the Trust,
Countrywide Fund Services, Inc. (CFS), formerly MGF Service, Corp., provides
administrative, pricing, accounting, dividend disbursing, shareholder servicing
and transfer agent services for the Fund. For these services, CFS receives a
monthly fee from the Fund at an annual rate of .075% of its average daily net
assets up to $200 million and .05% of such net assets in excess of $200 million,
subject to a $2,000 minimum monthly fee. In addition, the Fund pays
out-of-pocket expenses including, but not limited to, postage, supplies and cost
of pricing the Fund's portfolio securities. Certain officers of the Trust are
also officers of CFS.
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees
The Williamsburg Investment Trust
Cincinnati, Ohio
We have audited the accompanying statement of assets and liabilities of
The Jamestown Short Term Bond Fund (a series of The Williamsburg Investment
Trust), including the portfolio of investments, as of March 31, 1997, and the
related statement of operations for the year then ended, and the statement of
changes in net assets for each of the two years in the period then ended and the
financial highlights for each of the five years in the period then ended. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1997 by correspondence with the custodian. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of The Jamestown Short Term Bond Fund as of March 31, 1997, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended and the financial highlights for
each of the five years in the period then ended, in conformity with generally
accepted accounting principles.
Tait, Weller & Baker
Philadelphia, Pennsylvania
April 25, 1997
<PAGE>
PART C
OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements:
Included in Part A: Financial Highlights
Included in Part B: Statements of Assets and
Liabilities, Statements of
Operations, Statements of Changes
in Net Assets, Financial Highlights
and Portfolios of Investments as of
March 31, 1997
(b) Exhibits:
1. Declaration of Trust*
2. Bylaws*
3. Not Applicable
4. See Exhibits 1 and 2
5. (i) Investment Advisory Agreement for The
Jamestown Bond Fund**
(ii) Investment Advisory Agreement for The
Jamestown Short Term Bond Fund**
6. Not Applicable
7. Not Applicable
8. (i) Custodian Agreement with The Northern Trust
Company*
(ii) Custodian Agreement with Star Bank, N.A.*
9. Administration, Accounting and Transfer Agency
Agreement**
10. Opinion and Consent of Counsel*
11. Consent of Independent Public Accountants**
12. Not Applicable
13. Not Applicable
14. Not Applicable
15. Plan of Distribution Pursuant to Rule 12b-1**
<PAGE>
16. Not Applicable
17. Financial Data Schedules**
18. Rule 18f-3 Plan Adopted With Respect to the
Multiple Class Distribution System**
* Previously filed as Exhibit to Registration Statement on
Form N-1A
** Filed herewith
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT
No person is directly or indirectly controlled by or under
common control with the Registrant.
Item 26. NUMBER OF HOLDERS OF SECURITIES
Set forth is the number of record holders, as of May 31, 1997,
of the shares of the Trust:
Number of Record
TITLE OF CLASS HOLDERS
Shares of beneficial interest of
FBP Contrarian Equity Fund 328
Shares of beneficial interest of
FBP Contrarian Balanced Fund 458
Shares of beneficial interest of
The Government Street Equity Fund 283
Shares of beneficial interest of
The Government Street Bond Fund 148
Shares of beneficial interest of
The Alabama Tax Free Bond Fund 124
Shares of beneficial interest of
The Jamestown Balanced Fund 250
Shares of beneficial interest of
The Jamestown Equity Fund 212
Shares of beneficial interest of
The Jamestown Bond Fund 33
Shares of beneficial interest of
The Jamestown Short Term Bond Fund 13
<PAGE>
Shares of beneficial interest of
The Jamestown Tax Exempt Virginia Fund 41
Shares of beneficial interest of
The Jamestown International Equity Fund 180
Item 27. INDEMNIFICATION. Article VIII of the Registrant's
Agreement and Declaration of Trust provides for
indemnification of officers and trustees as follows:
SECTION 8.4 Indemnification of Trustees and Officers.
Subject to the limitations set forth in this Section
8.4, the Trust shall indemnify (from the assets of
the Fund or Funds to which the conduct in question
relates) each of its Trustees and officers, including
persons who serve at the Trust's request as
directors, officers or trustees of another
organization in which the Trust has any interest as a
shareholder, creditor or otherwise (referred to
hereinafter, together with such person's heirs,
executors, administrators or other legal
representatives, as a "covered person") against all
liabilities, including but not limited to amounts
paid in satisfaction of judgments, in compromise or
as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by
any covered person in connection with the defense or
disposition of any action, suit or other proceeding,
whether civil or criminal, before any court or
administrative or legislative body, in which such
covered person may be or may have been involved as a
party or otherwise or with which such covered person
may be or may have been threatened, while in office
or thereafter, by reason of being or having been such
a Trustee or officer, director or trustee, except
with respect to any matter as to which it has been
determined that such covered person (i) did not act
in good faith in the reasonable belief that his
action was in or not opposed to the best interests of
the Trust or (ii) had acted with willful misfeasance,
bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office
(either and both of the conduct described in clauses
(i) and (ii) above being referred to hereinafter as
"Disabling Conduct"). A determination that the
covered person is entitled to indemnification may be
made by (i) a final decision on the merits by a court
or other body before whom the proceeding was brought
that such covered person was not liable by reason of
Disabling Conduct, (ii) dismissal of a court action
or an administrative action against such covered
person for insufficiency of evidence of
<PAGE>
Disabling Conduct, or (iii) a reasonable
determination, based upon a review of the facts, that
such covered person was not liable by reason of
Disabling Conduct by (a) vote of a majority of a
quorum of Trustees who are neither "interested
persons" of the Trust as the quoted phrase is defined
in Section 2(a) (19) of the Investment Company Act of
1940 nor parties to the action, suit or other
proceeding on the same or similar grounds is then or
has been pending or threatened (such quorum of such
Trustees being referred to hereinafter as the
"Disinterested Trustees"), or (b) an independent
legal counsel in a written opinion. Expenses,
including accountants' and counsel fees so incurred
by any such covered person (but excluding amounts
paid in satisfaction of judgments, in compromise or
as fines or penalties), may be paid from time to time
by the Fund or Funds to which the conduct in question
related in advance of the final disposition of any
such action, suit or proceeding; provided, that the
covered person Shall have undertaken to repay the
amounts so paid if it is ultimately determined that
indemnification of such expenses is not authorized
under this Article VIII and if (i) the covered person
shall have provided security for such undertaking,
(ii) the Trust shall be insured against losses
arising by reason of any lawful advances, or (iii) a
majority of the Independent Trustees, or an
independent legal counsel in a written opinion, shall
have determined, based on a review of readily
available facts (as opposed to a full inquiry), that
there is reason to believe that the covered person
ultimately will be entitled to indemnification
hereunder.
SECTION 8.5 Compromise Payment. As to any matter
disposed of by a compromise payment by any covered
person referred to in Section 8.4 hereof, pursuant to
a consent decree or otherwise, no such
indemnification either for said payment or for any
other expenses shall be provided unless such
indemnification shall be approved (i) by a majority
of the Disinterested Trustees or (ii) by an
independent legal counsel in a written opinion.
Approval by the Independent Trustees pursuant to
clause (ii) shall not prevent the recovery from any
covered person of any amount paid to such covered
person in accordance with either of such clauses as
indemnification if such covered person is
subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the
reasonable belief that such covered person's action
was in or not opposed to the best
<PAGE>
interests of the Trust or to have been liable to the
Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of
such covered person's office.
SECTION 8.6 Indemnification Not Exclusive. The right
of indemnification provided by this Article VIII
shall not be exclusive of or affect any of the rights
to which any covered person may be entitled. Nothing
contained in this Article VIII shall affect any
rights to indemnification to which personnel of the
Trust, other than Trustees and officers, and other
persons may be entitled by contract or otherwise
under law, nor the power of the Trust to purchase and
maintain liability insurance on behalf of any such
person.
The Trust's Advisory Agreements provide for indemnification of
each of the Advisors as follows:
8.(b) INDEMNIFICATION OF ADVISOR. Subject to the
limitations set forth in this Subsection 8(b), the
Trust shall indemnify, defend and hold harmless (from
the assets of the Fund or Funds to which the conduct
in question relates) the Advisor against all loss,
damage and liability, including but not limited to
amounts paid in satisfaction of judgments, in
compromise or as fines and penalties, and expenses,
including reasonable accountants' and counsel fees,
incurred by the Advisor in connection with the
defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any
court or administrative or legislative body, related
to or resulting from this Agreement or the
performance of services hereunder, except with
respect to any matter as to which it has been
determined that the loss, damage or liability is a
direct result of (i) a breach of fiduciary duty with
respect to the receipt of compensation for services;
or (ii) wilful misfeasance, bad faith or gross
negligence on the part of the Advisor in the
performance of its duties or from reckless disregard
by it of its duties under this Agreement (either and
both of the conduct described in clauses (i) and (ii)
above being referred to hereinafter as "DISABLING
CONDUCT"). A determination that the Advisor is
entitled to indemnification may be made by (i) a
final decision on the merits by a court or other body
before whom the proceeding was brought that the
Advisor was not liable by reason of Disabling
Conduct, (ii) dismissal of a court action or an
administrative proceeding against the Advisor for
<PAGE>
insufficiency of evidence of Disabling Conduct, or
(iii) a reasonable determination, based upon a review
of the facts, that the Advisor was not liable by
reason of Disabling Conduct by: (a) vote of a
majority of a quorum of Trustees who are neither
"interested persons" of the Trust as the quoted
phrase is defined in Section 2(a)(19) of the
Investment Company Act of 1940 nor parties to the
action, suit or other proceeding on the same or
similar grounds that is then or has been pending or
threatened (such quorum of such Trustees being
referred to hereinafter as the "INDEPENDENT
TRUSTEES"), or (b) an independent legal counsel in a
written opinion. Expenses, including accountants' and
counsel fees so incurred by the Advisor (but
excluding amounts paid in satisfaction of judgments,
in compromise or as fines or penalties), may be paid
from time to time by the Fund or Funds to which the
conduct in question related in advance of the final
disposition of any such action, suit or proceeding;
PROVIDED, that the Advisor shall have undertaken to
repay the amounts so paid if it is ultimately
determined that indemnification of such expenses is
not authorized under this Subsection 8(b) and if (i)
the Advisor shall have provided security for such
undertaking, (ii) the Trust shall be insured against
losses arising by reason of any lawful advances, or
(iii) a majority of the Independent Trustees, or an
independent legal counsel in a written opinion, shall
have determined, based on a review of readily
available facts (as opposed to a full trial-type
inquiry), that there is reason to believe that the
Advisor ultimately will be entitled to
indemnification hereunder.
As to any matter disposed of by a compromise payment
by the Advisor referred to in this Subsection 8(b),
pursuant to a consent decree or otherwise, no such
indemnification either for said payment or for any
other expenses shall be provided unless such
indemnification shall be approved (i) by a majority
of the Independent Trustees or (ii) by an independent
legal counsel in a written opinion. Approval by the
Independent Trustees pursuant to clause (i) shall not
prevent the recovery from the Advisor of any amount
paid to the Advisor in accordance with either of such
clauses as indemnification of the Advisor is
subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the
reasonable belief that the Advisor's action was in or
not opposed to the best interests of the
<PAGE>
Trust or to have been liable to the Trust or its
Shareholders by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the
duties involved in its conduct under the Agreement.
The right of indemnification provided by this
Subsection 8(b) shall not be exclusive of or affect
any of the rights to which the Advisor may be
entitled. Nothing contained in this Subsection 8(b)
shall affect any rights to indemnification to which
Trustees, officers or other personnel of the Trust,
and other persons may be entitled by contract or
otherwise under law, nor the power of the Trust to
purchase and maintain liability insurance on behalf
of any such person.
The Board of Trustees of the Trust shall take all
such action as may be necessary and appropriate to
authorize the Trust hereunder to pay the
indemnification required by this Subsection 8(b)
including, without limitation, to the extent needed,
to determine whether the Advisor is entitled to
indemnification hereunder and the reasonable amount
of any indemnity due it hereunder, or employ
independent legal counsel for that purpose.
8.(c) The provisions contained in Section 8 shall
survive the expiration or other termination of this
Agreement, shall be deemed to include and protect the
Advisor and its directors, officers, employees and
agents and shall inure to the benefit of its/their
respective successors, assigns and personal
representatives.
The Trust maintains a standard mutual fund and investment advisory
professional and directors and officers liability policy. Coverage under the
policy includes losses by reason of any act, error, omission, misstatement,
misleading statement, neglect or breach of duty. The Trust may not pay for
insurance which protects its Trustees and officers against liabilities arising
from action involving willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of their offices.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR
Lowe, Brockenbrough & Tattersall, Inc. ("LB&T") is a
registered investment advisor providing general
investment advisory services to four series of
Williamsburg Investment Trust: The Jamestown Balanced
Fund, The Jamestown Equity Fund, The Jamestown Tax
Exempt Virginia Fund and The Jamestown International
Equity Fund. LB&T acted as the co-investment advisor
<PAGE>
with Bridgewater Associates, Inc. to The Alpha World Fund,
another registered investment company, until July 1995. LB&T
also provides investment advisory services to corporations,
trusts, pension and profit sharing plans, other business and
institutional accounts and individuals. The following list
sets forth the business and other connections of the directors
and officers of LB&T, 6620 West Broad Street, Suite 300,
Richmond, Virginia 23230.
(1) Austin Brockenbrough III - Managing Director of
LB&T.
(a) A Trustee of Williamsburg Investment Trust, a
registered investment company, and President
of The Jamestown Tax Exempt Virginia Fund.
(2) Henry C. Spalding, Jr. - Executive Vice President
of LB&T.
(a) President of The Jamestown Balanced Fund and
The Jamestown Equity Fund.
(3) William F. Shumadine, Jr. - Senior Vice President
of LB&T.
(a) President of Central Fidelity Bank until
October, 1993.
(4) Ernest H. Stephensen, Jr. - Vice President of
LB&T.
(a) Vice President of The Jamestown Balanced Fund
and The Jamestown Equity Fund.
Lowe, Brockenbrough & Tattersall Strategic Advisors, Inc.
("LBTSA") is a registered investment advisor providing general
investment advisory services to two series of Williamsburg
Investment Trust, The Jamestown Bond Fund and The Jamestown
Short Term Bond Fund, and subadvisory services to The
Jamestown Balanced Fund, another series of Williamsburg
Investment Trust. LBTSA also provides investment advisory
services to corporations, trusts, pension and profit sharing
plans, other business and institutional accounts and
individuals. The following list sets forth the business and
other connections of the directors and officers of LBTSA, 6620
West Broad Street, Suite 300, Richmond, Virginia 23230.
<PAGE>
(1) Fred T. Tattersall - Managing Director of LBTSA.
(a) A Trustee of Williamsburg Investment Trust
and President of The Jamestown Bond Fund and
The Jamestown Short Term Bond Fund.
(2) Kevin D. Girts - Executive Vice President of
LBTSA.
(3) Craig D. Truitt - Senior Vice President of LBTSA.
(a) Vice President of The Jamestown Bond Fund and
The Jamestown Short Term Bond Fund.
Oechsle International Advisors, L.P. ("Oechsle International")
is a registered investment advisor which provides investment
advisory services and acts as sub-advisor to The Jamestown
International Equity Fund. The following are the partners of
Oechsle International, One International Place, Boston,
Massachusetts 02110.
(1) Oechsle Group, L.P. (the Managing General
Partner of which is Walter Oechsle), a
general partner of Oechsle International.
(2) Dresdner Asset Management (U.S.A.)
Corporation (a subsidiary of Dresdner Bank
A.G.), a limited partner of Oechsle
International.
(3) OIA Limited Partnership Interest Trust (the
trustee of which is Oechsle Group, L.P.), a
limited partner of Oechsle International
Flippin, Bruce & Porter, Inc. ("FBP") is a registered
investment advisor providing investment advisory services to
two series of Williamsburg Investment Trust: The FBP
Contrarian Balanced Fund and the FBP Contrarian Equity Fund.
The Advisor also provides investment advice to corporations,
trusts, pension and profit sharing plans, other business and
institutional account and individuals. The following list sets
forth the business and other connections of the directors and
officers of Flippin, Bruce & Porter, Inc., 800 Main Street,
Suite 202, P.O. Box 6138, Lynchburg, Virginia 24505.
(1) John T. Bruce - A Principal of FBP.
(a) Chairman of the Board of Trustees of
Williamsburg Investment Trust and
Vice President of FBP Contrarian
Balanced Fund and FBP Contrarian
Equity Fund.
<PAGE>
(2) John M. Flippin - A Principal of FBP
(a) President of FBP Contrarian Balanced
Fund and FBP Contrarian Equity Fund.
(3) Robert Gregory Porter III - A Principal of
FBP.
(a) Vice President of FBP Contrarian
Balanced Fund and FBP Contrarian
Equity Fund.
(4) Joseph T. Antonelli, Jr. - Portfolio
Manager of FBP.
(5) David J. Marshall - Portfolio Manager
of FBP.
T. Leavell & Associates, Inc. ("TLA") is a registered
investment advisor providing investment advisory
services to three series of Williamsburg Investment
Trust: The Government Street Equity Fund, The
Government Street Bond Fund and The Alabama Tax Free
Bond Fund. TLA also provides investment advice to
corporations, trusts, pension and profit sharing plans,
other business and institutional accounts and
individuals. The following list sets forth the
business and other connections of the directors and
officers of T. Leavell & Associates, Inc., 150
Government Street, P.O. Box 1307, Mobile, Alabama
36633.
(1) Thomas W. Leavell - President and a
Principal of TLA.
(2) Dorothy G. Gambill - Secretary/Treasurer
and a Principal of TLA.
(3) Richard Mitchell - Executive Vice President
and a Principal of TLA.
(a) A Trustee of Williamsburg Investment
Trust and President of The Government
Street Bond Fund, The Government
Street Equity Fund and The Alabama
Tax Free Bond Fund.
(4) Kenneth P. Pulliam - Portfolio Manager of
TLA.
(5) Timothy S. Healy - Vice President and
Portfolio Manager of TLA.
(a) Vice President of The Alabama Tax
Free Bond Fund.
(6) Ann Damon Haas - Vice President of TLA.
<PAGE>
Item 29. PRINCIPAL UNDERWRITER
Not Applicable
Item 30. LOCATIONS OF ACCOUNTS AND RECORDS
The Registrant maintains the records required by Section 31(a)
of the Investment Company Act of 1940 and Rules 31a-1 to 31a-3
inclusive thereunder at its principal executive office.
Certain records, including records relating to the
Registrant's shareholders and the physical possession of its
securities, may be maintained pursuant to Rule 31a-3 at the
main offices of the Registrant's transfer and dividend
disbursing agent and custodian.
Item 31. MANAGEMENT SERVICES
See discussion in Part A under "Management of the Fund -
Administrator" and in Part B under "Administrator."
Item 32. UNDERTAKINGS
(a) Not Applicable
(b) Not Applicable
(c) The Registrant undertakes to furnish each person to
whom a prospectus is delivered with a copy of the
Registrant's latest report to shareholders, upon
request and without charge.
(d) The Registrant hereby undertakes to comply with the
provisions of Section 16(c) of the Investment Company
Act of 1940, as amended.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Amendment
to the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Cincinnati and the State of Ohio on
the 27th day of June, 1997.
WILLIAMSBURG INVESTMENT TRUST
By: /S/ JOHN F. SPLAIN
John F. Splain,
Attorney-in-Fact
The term "Williamsburg Investment Trust" means and refers to the Trustees
from time to time serving under the Agreement and Declaration of Trust of the
Registrant dated July 18, 1988, as amended, a copy of which is on file with the
Secretary of State of The Commonwealth of Massachusetts. The obligations of the
Registrant hereunder are not binding personally upon any of the Trustees,
shareholders, nominees, officers, agents or employees of the Registrant, but
bind only the trust property of the Registrant, as provided in the Agreement and
Declaration of Trust of the Registrant. The execution of this Registration
Statement has been authorized by the Trustees of the Registrant and this
Registration Statement has been signed by an authorized officer of the
Registrant, acting as such, and neither such authorization by such Trustees nor
such execution by such officer shall be deemed to have been made by any of them,
but shall bind only the trust property of the Registrant as provided in its
Declaration of Trust.
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated:
Signature Title Date
/s/ John T. Bruce
Trustee and Chairman June 27, 1997
John T. Bruce (principal executive
officer)
/s/ Mark J. Seger
Treasurer (principal June 27, 1997
Mark J. Seger financial and
accounting officer)
Austin Brockenbrough III* Trustee
Charles M. Caravati* Trustee
J. Finley Lee, Jr.* Trustee
Richard Mitchell* Trustee
Richard L. Morrill* Trustee
Harris V. Morrissette* Trustee
Fred T. Tattersall* Trustee
Samuel B. Witt III* Trustee
*By: /S/ JOHN F. SPLAIN
John F. Splain
Attorney-in-Fact
June 27, 1997
INDEX TO EXHIBITS
Exhibit
NUMBER DESCRIPTION OF EXHIBIT
1 Declaration of Trust*
2 Bylaws*
3 Not Applicable
4 See Exhibits 1 and 2
5 (i) Investment Advisory Agreement for the Bond Fund**
(ii) Investment Advisory Agreement for the Short Term
Bond Fund**
6 Not Applicable
7 Not Applicable
8 (i) Custodian Agreement with The Northern Trust
Company*
(ii) Custodian Agreement with Star Bank, N.A.*
9 Administration, Accounting and
Transfer Agency Agreement**
10 Opinion and Consent of Counsel*
11 Consent of Independent Public Accountants**
12 Not Applicable
13 Not Applicable
14 Not Applicable
15 Plan of Distribution Pursuant to Rule 12b-1**
16 Not Applicable
17 Financial Data Schedule**
18 Rule 18f-3 Plan Adopted With Respect to the
Multiple Class Distribution System**
* Previously filed as Exhibit to Registration
Statement on Form N-1A
** Filed herewith
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of February 28, 1997, by and between
WILLIAMSBURG INVESTMENT TRUST, a Massachusetts business trust (the "Trust"), on
behalf of THE JAMESTOWN BOND FUND, and LOWE BROCKENBROUGH & TATTERSALL STRATEGIC
ADVISORS, INC., a Virginia corporation (the "Adviser"), registered as an
investment adviser under the Investment Advisers Act of 1940, as amended.
WHEREAS, the Trust is registered as a no-load, open-end management investment
company of the series type under the Investment Company Act of 1940, as amended
(the "1940 Act"); and
WHEREAS, the Trust desires to retain the Adviser to furnish investment advisory
and administrative services to The Jamestown Bond Fund series of the Trust, and
the Adviser is willing to so furnish such services;
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Trust hereby appoints the Adviser to act as investment
adviser to The Jamestown Bond Fund series of the Trust (the "Fund") for
the period and on the terms set forth in this Agreement. The Adviser
accepts such appointment and agrees to furnish the services herein set
forth, for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. The Trust has furnished the Adviser
with copies properly certified or authenticated of each
of the following:
(a) The Trust's Declaration of Trust, as filed with the
Commonwealth of Massachusetts (such Declaration, as presently
in effect and as it shall from time to time be amended, is
herein called the "Declaration");
(b) The Trust's Bylaws (such Bylaws, as presently in effect
and as they shall from time to time be amended, are
herein called the "Bylaws");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Registration Statement on Form N-1A under the 1940
Act and under the Securities Act of 1933 as amended, relating
to shares of beneficial interest of the Trust (herein called
the "Shares") as filed with the Securities and Exchange
Commission ("SEC") and all amendments thereto;
<PAGE>
(e) The Fund's Prospectus (such Prospectus, as presently in
effect and all amendments and supplements thereto are
herein called the "Prospectus").
The Trust will furnish the Adviser from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements to the foregoing at the same time as such documents are
required to be filed with the SEC.
3. MANAGEMENT. Subject to the supervision of the Trust's Board
----------
of Trustees, the Adviser will provide a continuous
investment program for the Fund, including investment
research and management with respect to all securities,
investments, cash and cash equivalents of the Fund. The
Adviser will determine from time to time what securities and
other investments will be purchased, retained or sold by the
Fund. The Adviser will provide the services under this
Agreement in accordance with the Fund's investment
objectives, policies and restrictions as stated in its
Prospectus. The Adviser further agrees that it:
(a) Will conform its activities to all applicable Rules and
Regulations of the SEC and will, in addition, conduct its
activities under this Agreement in accordance with regulations
of any other Federal and State agencies which may now or in
the future have jurisdiction over its activities under this
Agreement;
(b) Will place orders pursuant to its investment
determinations for the Fund either directly with the
issuer or with any broker or dealer. In placing orders
with brokers or dealers, the Adviser will attempt to
obtain the best net price and the most favorable
execution of its orders. Consistent with this
obligation, when the Adviser believes two or more
brokers or dealers are comparable in price and
execution, the Adviser may prefer brokers and dealers
who provide the Fund with research advice and other
valuable services;
(c) Will provide certain executive personnel for the Trust as may
be mutually agreed upon from time to time with the Board of
Trustees, the salaries and expenses of such personnel to be
borne by the Adviser unless otherwise mutually agreed upon;
and
(d) Will provide, at its own cost, all office space, facilities
and equipment necessary for the conduct of its advisory
activities on behalf of the Trust.
4. SERVICES NOT EXCLUSIVE. The advisory services furnished by
the Adviser hereunder are not to be deemed exclusive, and
the Adviser shall be free to furnish similar services to
others so long as its services under this Agreement are not
impaired.
<PAGE>
5. BOOKS AND RECORDS. In compliance with the requirements of
-----------------
Rule 31a-3 under the 1940 Act, the Adviser hereby agrees
that all records which it maintains for the benefit of the
Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the
Trust's request. The Adviser further agrees to preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act the
records required to be maintained by it pursuant to Rule
31a-1 under the 1940 Act that are not maintained by others
on behalf of the Trust.
6. EXPENSES. During the term of this Agreement, the Adviser will pay all
expenses incurred by it in connection with its investment advisory
services pertaining to the Fund. In the event that there is no
distribution plan under Rule 12b-1 of the 1940 Act in effect for the
Fund, the Adviser will pay the entire cost of the promotion and sale of
Fund shares.
Notwithstanding the foregoing, the Fund shall pay the expenses and
costs of the following:
(a) Taxes, interest charges and extraordinary expenses;
(b) Brokerage fees and commissions with regard to portfolio
transactions of the Fund;
(c) Fees and expenses of the custodian of the Fund's
portfolio securities;
(d) Fees and expenses of the Fund's administration agent, the
Fund's transfer and shareholder servicing agent and the Fund's
accounting agent or, if the Trust performs any such services
without an agent, the costs of the same;
(e) Auditing and legal expenses;
(f) Cost of maintenance of the Trust's existence as a legal
entity;
(g) Compensation of Trustees who are not interested persons
of the Adviser as that term is defined by law;
(h) Costs of Trust meetings;
(i) Federal and State registration or qualification fees
and expenses;
(j) Costs of setting in type, printing and mailing
Prospectuses, reports and notices to existing
shareholders; and
(k) The investment advisory fee payable to the Adviser, as
provided in paragraph 7 herein.
7. COMPENSATION. For the services provided and the expenses assumed by the
Adviser pursuant to this Agreement, the Fund will pay the Adviser and
the Adviser will accept as full compensation an investment advisory
fee, based upon the daily average net assets of the Fund, computed at
the end of each month and payable within five (5) business days
thereafter, at the annual rate of 0.375%.
<PAGE>
8.(a) LIMITATION OF LIABILITY.
-----------------------
The Adviser shall not be liablefor any error of judgment, mistake of
law or for any other loss whatsoever suffered by the Trust in
connection with the performance of this Agreement, except a loss
resulting from a breach offiduciary duty with respect to the receipt
of compensation for services or a loss resulting from wilful
misfeasance, bad faith or gross negligence on the part of the
Adviser in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement.
8.(b) INDEMNIFICATION OF ADVISER. Subject to the limitations set forth in
this Subsection 8(b), the Trust shall indemnify, defend and hold
harmless (from the assets of the Fund or Funds to which the conduct in
question relates) the Adviser against all loss, damage and liability,
including but not limited to amounts paid in satisfaction of judgments,
in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by the Adviser in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or
administrative or legislative body, related to or resulting from this
Agreement or the performance of services hereunder, except with respect
to any matter as to which it has been determined that the loss, damage
or liability is a direct result of (i) a breach of fiduciary duty with
respect to the receipt of compensation for services; or (ii) willful
misfeasance, bad faith or gross negligence on the part of the Adviser
in the performance of its duties or from reckless disregard by it
of its duties under this Agreement (either and both of the
conduct described in clauses (i) and (ii) above being
referred to hereinafter as "DISABLING CONDUCT"). A
determination that the Adviser is entitled to indemnification may be
made by (i) a final decision on the merits by a court or other body
before whom the proceeding was brought that the Adviser was not liable
by reason of Disabling Conduct, (ii) dismissal of a court action or an
administrative proceeding against the Adviser for insufficiency of
evidence of Disabling Conduct, or (iii) a reasonable determination,
based upon a review of the facts, that the Adviser was not liable by
reason of Disabling Conduct by (a) vote of a majority of a quorum of
Trustees who are neither "interested persons" of the Trust as the
quoted phrase is defined in Section 2(a)(19) of the 1940 Act nor
parties to the action, suit or other proceeding on the same or similar
grounds that is then or has been pending or threatened (such quorum of
Trustees being referred to hereinafter as the "INDEPENDENT TRUSTEES"),
or (b) an independent legal counsel in a written opinion. Expenses,
including accountants' and counsel fees so incurred by the Adviser (but
excluding amounts paid in satisfaction of judgments, in compromise or
as fines or penalties), may be paid from time to time by the Fund or
Funds to which the conduct in question related in advance of the final
<PAGE>
disposition of any such action, suit or proceeding; PROVIDED, that the
Adviser shall have undertaken to repay the amounts so paid if it is
ultimately determined that indemnification of such expenses is not
authorized under this Subsection 8(b) and if (i) the Adviser shall have
provided security for such undertaking, (ii) the Trust shall be insured
against losses arising by reason of any lawful
advances, or (iii) a majority of the Independent Trustees,
or an independent legal counsel in a written opinion, shall
have determined, based on a review of readily available facts (as
opposed to a full trial-type inquiry), that there is reason to believe
that the Adviser ultimately will be entitled to indemnification
hereunder.
As to any matter disposed of by a compromise payment by the Adviser
referred to in this Subsection 8(b), pursuant to a consent decree or
otherwise, no such indemnification either for said payment or for any
other expenses shall be provided unless such indemnification shall be
approved (i) by a majority of the Independent Trustees or (ii) by an
independent legal counsel in a written opinion. Approval by the
Independent Trustees pursuant to clause (i) shall not prevent the
recovery from the Adviser of any amount paid to the Adviser in
accordance with either of such clauses as indemnification of the
Adviser is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief
that the Adviser's action was in or not opposed to the best interests
of the Trust or to have been liable to the Trust or its Shareholders by
reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in its conduct under the Agreement.
The right of indemnification provided by this Subsection 8(b) shall not
be exclusive of or affect any of the rights to indemnification to which
the Adviser may be entitled. Nothing contained in this Subsection 8(b)
shall affect any rights to indemnification to which Trustees, officers
or other personnel of the Trust, and other persons may be entitled by
contract or otherwise under law, nor the power of the Trust to purchase
and maintain liability insurance on behalf of any such person.
The Board of Trustees of the Trust shall take all such action as may be
necessary and appropriate to authorize the Trust hereunder to pay the
indemnification required by this Subsection 8(b) including, without
limitation, to the extent needed, to determine whether the Adviser is
entitled to indemnification hereunder and the reasonable amount of any
indemnity due it hereunder, or employ independent legal counsel for
that purpose.
8.(c) The provisions contained in Section 8 shall survive the
expiration or other termination of this Agreement, shall be
deemed to include and protect the Adviser and its directors,
<PAGE>
officers, employees and agents and shall inure to the benefit of
its/their respective successors, assigns and personal representatives.
9. DURATION AND TERMINATION. This Agreement shall be effective on the date
hereof and, unless sooner terminated as provided herein, shall continue
in effect for two years. Thereafter, this Agreement shall be renewable
for successive periods of one year each, PROVIDED such continuance is
specifically approved annually:
(a) By a vote of the majority of those members of the Board of
Trustees who are not parties to this Agreement or interested
persons of any such party (as that term is defined in the 1940
Act), cast in person at a meeting called for the purpose of
voting on such approval; and
(b) By vote of either the Board or a majority (as that term is
defined in the 1940 Act) of the outstanding voting securities
of the Fund.
Notwithstanding the foregoing, this Agreement may be terminated by the
Fund or by the Adviser at any time on sixty (60) days' written notice,
without the payment of any penalty, provided that termination by the
Fund must be authorized either by vote of the Board of Trustees or by
vote of a majority of the outstanding voting securities of the Fund.
This Agreement will automatically terminate in the event of its
assignment (as that term is defined in the 1940 Act).
10. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement
---------------------------
may be changed, waived, discharged or terminated orally, but
only by a written instrument signed by the party against
which enforcement of this change, waiver, discharge or
termination is sought. No material amendment of this
Agreement shall be effective until approved by a vote of the
holders of a majority of the Fund's outstanding voting
securities (as defined in the 1940 Act).
11. SHAREHOLDER LIABILITY. The Advisor is hereby expressly put
---------------------
on notice of the limitation of shareholder liability as set
forth in the Agreement and Declaration of Trust of the
Trust, which is on file with the Secretary of the
Commonwealth of Massachusetts, and agrees that obligations
assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the Fund and its assets. The
Advisor agrees that it shall not seek satisfaction of any
such obligations from the shareholders or any individual
shareholder of the Fund, nor from the Trustees or any
individual Trustee of the Trust.
<PAGE>
12. MISCELLANEOUS. The captions in this Agreement are included
-------------
for convenience of reference only and in no way define or
limit any of the provisions hereof or otherwise affect their
construction or effect. If any provision of this Agreement
shall be held or made invalid by a court decision, statute,
rule or otherwise, the remainder of the Agreement shall not
be affected thereby. This Agreement shall be binding and
shall inure to the benefit of the parties hereto and their
respective successors.
13. APPLICABLE LAW. This Agreement shall be construed in
accordance with, and governed by, the laws of the
Commonwealth of Virginia.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
ATTEST: WILLIAMSBURG INVESTMENT TRUST
By: /S/ JOHN F. SPLAIN By:/S/ JOHN T. BRUCE
Title: SECRETARY Title: CHAIRMAN
ATTEST: LOWE BROCKENBROUGH & TATTERSALL
STRATEGIC ADVISORS, INC.
By:______________________ By: /S/ FRED T. TATTERSALL
Title:___________________ Title: MANAGING DIRECTOR
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of February 28, 1997, by and between
WILLIAMSBURG INVESTMENT TRUST, a Massachusetts business trust (the "Trust"), on
behalf of THE JAMESTOWN SHORT TERM BOND FUND, and LOWE BROCKENBROUGH &
TATTERSALL STRATEGIC ADVISORS, INC., a Virginia corporation (the "Adviser"),
registered as an investment adviser under the Investment Advisers Act of 1940,
as amended.
WHEREAS, the Trust is registered as a no-load, open-end management investment
company of the series type under the Investment Company Act of 1940, as amended
(the "1940 Act"); and
WHEREAS, the Trust desires to retain the Adviser to furnish investment advisory
and administrative services to The Jamestown Short Term Bond Fund series of the
Trust, and the Adviser is willing to so furnish such services;
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Trust hereby appoints the Adviser to act
as investment adviser to The Jamestown Short Term Bond Fund series of
the Trust (the "Fund") for the period and on the terms set forth in
this Agreement. The Adviser accepts such appointment and agrees to
furnish the services herein set forth, for the compensation herein
provided.
2. DELIVERY OF DOCUMENTS. The Trust has furnished the Adviser
with copies properly certified or authenticated of each
of the following:
(a) The Trust's Declaration of Trust, as filed with the
Commonwealth of Massachusetts (such Declaration, as presently
in effect and as it shall from time to time be amended, is
herein called the "Declaration");
(b) The Trust's Bylaws (such Bylaws, as presently in effect
and as they shall from time to time be amended, are
herein called the "Bylaws");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Registration Statement on Form N-1A under the 1940
Act and under the Securities Act of 1933 as amended, relating
to shares of beneficial interest of the Trust (herein called
the "Shares") as filed with the Securities and Exchange
Commission ("SEC") and all amendments thereto;
<PAGE>
(e) The Fund's Prospectus (such Prospectus, as presently in
effect and all amendments and supplements thereto are
herein called the "Prospectus").
The Trust will furnish the Adviser from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements to the foregoing at the same time as such documents are
required to be filed with the SEC.
3. MANAGEMENT. Subject to the supervision of the Trust's Board
----------
of Trustees, the Adviser will provide a continuous
investment program for the Fund, including investment
research and management with respect to all securities,
investments, cash and cash equivalents of the Fund. The
Adviser will determine from time to time what securities and
other investments will be purchased, retained or sold by the
Fund. The Adviser will provide the services under this
Agreement in accordance with the Fund's investment
objectives, policies and restrictions as stated in its
Prospectus. The Adviser further agrees that it:
(a) Will conform its activities to all applicable Rules and
Regulations of the SEC and will, in addition, conduct its
activities under this Agreement in accordance with regulations
of any other Federal and State agencies which may now or in
the future have jurisdiction over its activities under this
Agreement;
(b) Will place orders pursuant to its investment
determinations for the Fund either directly with the
issuer or with any broker or dealer. In placing orders
with brokers or dealers, the Adviser will attempt to
obtain the best net price and the most favorable
execution of its orders. Consistent with this
obligation, when the Adviser believes two or more
brokers or dealers are comparable in price and
execution, the Adviser may prefer brokers and dealers
who provide the Fund with research advice and other
valuable services;
(c) Will provide certain executive personnel for the Trust as may
be mutually agreed upon from time to time with the Board of
Trustees, the salaries and expenses of such personnel to be
borne by the Adviser unless otherwise mutually agreed upon;
and
(d) Will provide, at its own cost, all office space, facilities
and equipment necessary for the conduct of its advisory
activities on behalf of the Trust.
4. SERVICES NOT EXCLUSIVE. The advisory services furnished by
the Adviser hereunder are not to be deemed exclusive, and
the Adviser shall be free to furnish similar services to
others so long as its services under this Agreement are not
impaired.
<PAGE>
5. BOOKS AND RECORDS. In compliance with the requirements of
-----------------
Rule 31a-3 under the 1940 Act, the Adviser hereby agrees
that all records which it maintains for the benefit of the
Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the
Trust's request. The Adviser further agrees to preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act the
records required to be maintained by it pursuant to Rule
31a-1 under the 1940 Act that are not maintained by others
on behalf of the Trust.
6. EXPENSES. During the term of this Agreement, the Adviser will pay all
expenses incurred by it in connection with its investment advisory
services pertaining to the Fund. In the event that there is no
distribution plan under Rule 12b-1 of the 1940 Act in effect for the
Fund, the Adviser will pay the entire cost of the promotion and sale of
Fund shares.
Notwithstanding the foregoing, the Fund shall pay the expenses and
costs of the following:
(a) Taxes, interest charges and extraordinary expenses;
(b) Brokerage fees and commissions with regard to portfolio
transactions of the Fund;
(c) Fees and expenses of the custodian of the Fund's
portfolio securities;
(d) Fees and expenses of the Fund's administration agent, the
Fund's transfer and shareholder servicing agent and the Fund's
accounting agent or, if the Trust performs any such services
without an agent, the costs of the same;
(e) Auditing and legal expenses;
(f) Cost of maintenance of the Trust's existence as a legal
entity;
(g) Compensation of Trustees who are not interested persons
of the Adviser as that term is defined by law;
(h) Costs of Trust meetings;
(i) Federal and State registration or qualification fees
and expenses;
(j) Costs of setting in type, printing and mailing
Prospectuses, reports and notices to existing
shareholders; and
(k) The investment advisory fee payable to the Adviser, as
provided in paragraph 7 herein.
7. COMPENSATION. For the services provided and the expenses assumed by the
Adviser pursuant to this Agreement, the Trust will pay the Adviser and
the Adviser will accept as full compensation an investment advisory
fee, based upon the daily average net assets of the Fund, computed at
the end of each month and payable within five (5) business days
thereafter, at the annual rate of 0.375%.
<PAGE>
8.(a) LIMITATION OF LIABILITY. The Adviser shall not be liable
-----------------------
for any error of judgment, mistake of law or for any other
loss whatsoever suffered by the Trust in connection with the
performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from wilful
misfeasance, bad faith or gross negligence on the part of
the Adviser in the performance of its duties or from
reckless disregard by it of its obligations and duties under
this Agreement.
8.(b) INDEMNIFICATION OF ADVISER. Subject to the limitations set forth in
this Subsection 8(b), the Trust shall indemnify, defend and hold
harmless (from the assets of the Fund or Funds to which the conduct in
question relates) the Adviser against all loss, damage and liability,
including but not limited to amounts paid in satisfaction of judgments,
in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by the Adviser in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or
administrative or legislative body, related to or resulting from this
Agreement or the performance of services hereunder, except with respect
to any matter as to which it has been determined that the loss, damage
or liability is a direct result of (i) a breach of fiduciary duty with
respect to the receipt of compensation for services; or (ii) willful
misfeasance, bad faith or gross negligence on the part of the Adviser
in the performance of its duties or from reckless disregard by it of
its duties under this Agreement (either and both of the conduct
described in clauses (i) and (ii) above being referred to hereinafter
as "DISABLING CONDUCT"). A determination that the Adviser is entitled
to indemnification may be made by (i) a final decision on the merits by
a court or other body before whom the proceeding was brought that the
Adviser was not liable by reason of Disabling Conduct, (ii) dismissal
of a court action or an administrative proceeding against the Adviser
for insufficiency of evidence of Disabling Conduct, or (iii) a
reasonable determination, based upon a review of the facts, that the
Adviser was not liable by reason of Disabling Conduct by (a) vote of a
majority of a quorum of Trustees who are neither "interested persons"
of the Trust as the quoted phrase is defined in Section 2(a)(19) of the
1940 Act nor parties to the action, suit or other proceeding on the
same or similar grounds that is then or has been pending or threatened
(such quorum of Trustees being referred to hereinafter as the
"INDEPENDENT TRUSTEES"), or (b) an independent legal counsel in a
written opinion. Expenses, including accountants' and counsel fees so
incurred by the Adviser (but excluding amounts paid in satisfaction of
judgments, in compromise or as fines or penalties), may be paid from
time to time by the Fund or Funds to which the
<PAGE>
conduct in question related in advance of the final disposition of any
such action, suit or proceeding; PROVIDED, that the Adviser shall have
undertaken to repay the amounts so paid if it is ultimately determined
that indemnification of such expenses is not authorized under this
Subsection 8(b) and if (i) the Adviser shall have provided security for
such undertaking, (ii) the Trust shall be insured against losses
arising by reason of any lawful advances, or (iii) a majority of the
Independent Trustees, or an independent legal counsel in a written
opinion, shall have determined, based on a review of readily available
facts (as opposed to a full trial-type inquiry), that there is reason
to believe that the Adviser ultimately will be entitled to
indemnification hereunder.
As to any matter disposed of by a compromise payment by the Adviser
referred to in this Subsection 8(b), pursuant to a consent decree or
otherwise, no such indemnification either for said payment or for any
other expenses shall be provided unless such indemnification shall be
approved (i) by a majority of the Independent Trustees or (ii) by an
independent legal counsel in a written opinion. Approval by the
Independent Trustees pursuant to clause (i) shall not prevent the
recovery from the Adviser of any amount paid to the Adviser in
accordance with either of such clauses as indemnification of the
Adviser is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief
that the Adviser's action was in or not opposed to the best interests
of the Trust or to have been liable to the Trust or its Shareholders by
reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in its conduct under the Agreement.
The right of indemnification provided by this Subsection 8(b) shall not
be exclusive of or affect any of the rights to indemnification to which
the Adviser may be entitled. Nothing contained in this Subsection 8(b)
shall affect any rights to indemnification to which Trustees, officers
or other personnel of the Trust, and other persons may be entitled by
contract or otherwise under law, nor the power of the Trust to purchase
and maintain liability insurance on behalf of any such person.
The Board of Trustees of the Trust shall take all such action as may be
necessary and appropriate to authorize the Trust hereunder to pay the
indemnification required by this Subsection 8(b) including, without
limitation, to the extent needed, to determine whether the Adviser is
entitled to indemnification hereunder and the reasonable amount of any
indemnity due it hereunder, or employ independent legal counsel for
that purpose.
<PAGE>
8.(c) The provisions contained in Section 8 shall survive the expiration or
other termination of this Agreement, shall be deemed to include and
protect the Adviser and its directors, officers, employees and agents
and shall inure to the benefit of its/their respective successors,
assigns and personal representatives.
9. DURATION AND TERMINATION. This Agreement shall be effective on the date
hereof and, unless sooner terminated as provided herein, shall continue
in effect for two years. Thereafter, this Agreement shall be renewable
for successive periods of one year each, PROVIDED such continuance is
specifically approved annually:
(a) By a vote of the majority of those members of the Board of
Trustees who are not parties to this Agreement or interested
persons of any such party (as that term is defined in the 1940
Act), cast in person at a meeting called for the purpose of
voting on such approval; and
(b) By vote of either the Board or a majority (as that term is
defined in the 1940 Act) of the outstanding voting securities
of the Fund.
Notwithstanding the foregoing, this Agreement may be terminated by the
Fund or by the Adviser at any time on sixty (60) days' written notice,
without the payment of any penalty, provided that termination by the
Fund must be authorized either by vote of the Board of Trustees or by
vote of a majority of the outstanding voting securities of the Fund.
This Agreement will automatically terminate in the event of its
assignment (as that term is defined in the 1940 Act).
10. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement
---------------------------
may be changed, waived, discharged or terminated orally, but
only by a written instrument signed by the party against
which enforcement of this change, waiver, discharge or
termination is sought. No material amendment of this
Agreement shall be effective until approved by a vote of the
holders of a majority of the Fund's outstanding voting
securities (as defined in the 1940 Act).
11. SHAREHOLDER LIABILITY. The Advisor is hereby expressly put
---------------------
on notice of the limitation of shareholder liability as set
forth in the Agreement and Declaration of Trust of the
Trust, which is on file with the Secretary of the
Commonwealth of Massachusetts, and agrees that obligations
assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the Fund and its assets. The
Advisor agrees that it shall not seek satisfaction of any
such obligations from the shareholders or any individual
shareholder of the Fund, nor from the Trustees or any
individual Trustee of the Trust.
<PAGE>
12. MISCELLANEOUS. The captions in this Agreement are included
-------------
for convenience of reference only and in no way define or
limit any of the provisions hereof or otherwise affect their
construction or effect. If any provision of this Agreement
shall be held or made invalid by a court decision, statute,
rule or otherwise, the remainder of the Agreement shall not
be affected thereby. This Agreement shall be binding and
shall inure to the benefit of the parties hereto and their
respective successors.
13. APPLICABLE LAW. This Agreement shall be construed in
accordance with, and governed by, the laws of the
Commonwealth of Virginia.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
ATTEST: WILLIAMSBURG INVESTMENT TRUST
By: /S/ JOHN F. SPLAIN By:/S/ JOHN T. BRUCE
Title: SECRETARY Title: CHAIRMAN
ATTEST: LOWE BROCKENBROUGH & TATTERSALL
STRATEGIC ADVISORS, INC.
By:______________________ By: /S/ FRED T. TATTERSALL
Title:___________________ Title: MANAGING DIRECTOR
ADMINISTRATION, ACCOUNTING AND TRANSFER AGENCY AGREEMENT
AGREEMENT dated as of February 28, 1997 between Williamsburg Investment
Trust (the "Trust"), a Massachusetts business trust, and Countrywide Fund
Services, Inc. ("Countrywide"), an Ohio corporation.
WHEREAS, the Trust is an investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust wishes to employ the services of Countrywide to
serve as its administrative agent, accounting and pricing agent and transfer and
dividend disbursing agent; and
WHEREAS, Countrywide wishes to provide such services under
the conditions set forth below;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the Trust and Countrywide agree as follows:
1. APPOINTMENT.
The Trust hereby appoints and employs Countrywide as agent to
perform those services described in this Agreement for the Trust. Countrywide
shall act under such appointment and perform the obligations thereof upon the
terms and conditions hereinafter set forth.
2. DOCUMENTATION.
The Trust will furnish from time to time the following
documents:
A. Each resolution of the Board of Trustees of the Trust
authorizing the original issue of its shares;
B. Each Registration Statement filed with the Securities
and Exchange Commission (the "SEC") and amendments
thereof;
C. A certified copy of each amendment to the Agreement and
Declaration of Trust and the By-Laws of the Trust;
D. Certified copies of each resolution of the Board of
Trustees authorizing officers to give instructions to
Countrywide;
E. Specimens of all new forms of share certificates
accompanied by Board of Trustees' resolutions approving
such forms;
<PAGE>
F. Such other certificates, documents or opinions which
Countrywide may, in its discretion, deem necessary or
appropriate in the proper performance of its duties;
G. Copies of all Underwriting and Dealer Agreements in
effect;
H. Copies of all Investment Advisory Agreements in effect;
and
I. Copies of all documents relating to special investment
or withdrawal plans which are offered or may be offered
in the future by the Trust and for which Countrywide is
to act as plan agent.
3. TRUST ADMINISTRATION.
Subject to the direction and control of the Trustees of the
Trust, Countrywide shall supervise the Trust's business affairs not otherwise
supervised by other agents of the Trust. To the extent not otherwise the primary
responsibility of, or provided by, other agents of the Trust, Countrywide shall
supply (i) office facilities, (ii) internal auditing and regulatory services,
and (iii) executive and administrative services. Countrywide shall coordinate
the preparation of (i) reports to shareholders of the Trust, (ii) reports to and
filings with the SEC and state securities authorities including preliminary and
definitive proxy materials, post-effective amendments to the Trust's
registration statement, and the Trust's Form N-SAR, and (iii) necessary
materials for Board of Trustees' meetings unless prepared by other parties under
agreement with the Trust. Countrywide shall also supervise the preparation of
all federal, state and local tax returns and reports of the Trust required by
applicable law. Countrywide shall provide personnel to serve as officers of the
Trust if so elected by the Board of Trustees; provided, however, that the Trust
shall reimburse Countrywide for the reasonable out-of-pocket expenses incurred
by such personnel in attending Board of Trustees' meetings and shareholders'
meetings of the Trust.
4. CALCULATION OF NET ASSET VALUE.
Countrywide will maintain and keep current the general ledger
for each series of the Trust, recording all income and expenses, capital share
activity and security transactions of the Trust. Countrywide will calculate the
net asset value of each series of the Trust and the per share net asset value of
each series of the Trust, in accordance with the Trust's current prospectus and
statement of additional information, once daily as of the time selected by the
Trust's Board of Trustees. Countrywide will prepare and maintain a daily
valuation of all
<PAGE>
securities and other assets of the Trust in accordance with instructions from a
designated officer of the Trust or its investment adviser and in the manner set
forth in the Trust's current prospectus and statement of additional information.
In valuing securities of the Trust, Countrywide may contract with, and rely upon
market quotations provided by, outside services.
5. PAYMENT OF TRUST EXPENSES.
Countrywide shall process each request received from the Trust
or its authorized agents for payment of the Trust's expenses. Upon receipt of
written instructions signed by an officer or other authorized agent of the
Trust, Countrywide shall prepare checks in the appropriate amounts which shall
be signed by an authorized officer of Countrywide and mailed to the appropriate
party.
6. COUNTRYWIDE TO RECORD SHARES.
Countrywide shall record the issuance of shares of the Trust
and maintain pursuant to applicable rules of the SEC a record of the total
number of shares of the Trust which are authorized, issued and outstanding,
based upon data provided to it by the Trust. Countrywide shall also provide the
Trust on a regular basis or upon reasonable request the total number of shares
which are authorized, issued and outstanding, but shall have no obligation when
recording the issuance of the Trust's shares, except as otherwise set forth
herein, to monitor the issuance of such shares or to take cognizance of any laws
relating to the issue or sale of such shares, which functions shall be the sole
responsibility of the Trust.
7. COUNTRYWIDE TO VALIDATE TRANSFERS.
Upon receipt of a proper request for transfer and upon
surrender to Countrywide of certificates, if any, in proper form for transfer,
Countrywide shall approve such transfer and shall take all necessary steps to
effectuate the transfer as indicated in the transfer request. Upon approval of
the transfer, Countrywide shall notify the Trust in writing of each such
transaction and shall make appropriate entries on the shareholder records
maintained by Countrywide.
8. SHARE CERTIFICATES.
If the Trust authorizes the issuance of share certificates and
an investor requests a share certificate, Countrywide will countersign and mail,
by insured first class mail, a share certificate to the investor at his address
as set forth on the transfer books of the Trust, subject to any other
instructions for delivery of certificates representing newly purchased shares
and subject to the limitation that no certificates representing newly purchased
shares shall be mailed to the investor until the cash purchase price of such
shares has
<PAGE>
been collected and credited to the account of the Trust maintained by the
Custodian. The Trust shall supply Countrywide with a sufficient supply of blank
share certificates and from time to time shall renew such supply upon request of
Countrywide. Such blank share certificates shall be properly signed, manually
or, if authorized by the Trust, by facsimile; and notwithstanding the death,
resignation or removal of any officers of the Trust authorized to sign share
certificates, Countrywide may continue to countersign certificates which bear
the manual or facsimile signature of such officer until otherwise directed by
the Trust. In case of the alleged loss or destruction of any share certificate,
no new certificates shall be issued in lieu thereof, unless there shall first be
furnished an appropriate bond satisfactory to Countrywide and the Trust, and
issued by a surety company satisfactory to Countrywide and the Trust.
9. RECEIPT OF FUNDS.
Upon receipt of any check or other instrument drawn or
endorsed to it as agent for, or identified as being for the account of, the
Trust or the principal underwriter of the Trust (the "Underwriter"), Countrywide
shall stamp the check or instrument with the date of receipt, determine the
amount thereof due the Trust and shall forthwith process the same for
collection. Upon receipt of notification of receipt of funds eligible for share
purchases in accordance with the Trust's then current prospectus and statement
of additional information, Countrywide shall notify the Trust, at the close of
each business day, in writing of the amount of said funds credited to the Trust
and deposited in its account with the Custodian.
10. PURCHASE ORDERS.
Upon receipt of an order for the purchase of shares of the
Trust, accompanied by sufficient information to enable Countrywide to establish
a shareholder account, Countrywide shall, as of the next determination of net
asset value after receipt of such order in accordance with the Trust's then
current prospectus and statement of additional information, compute the number
of shares due to the shareholder, credit the share account of the shareholder,
subject to collection of the funds, with the number of shares so purchased,
shall notify the Trust in writing or by computer report at the close of each
business day of such transactions and shall mail to the shareholder and/or
dealer of record a notice of such credit when requested to do so by the Trust.
<PAGE>
11. RETURNED CHECKS.
In the event that Countrywide is notified by the Trust's
Custodian that any check or other order for the payment of money is returned
unpaid for any reason, Countrywide will:
A. Give prompt notification to the Trust and the
Underwriter of the non-payment of said check;
B. In the absence of other instructions from the Trust or the
Underwriter, take such steps as may be necessary to redeem any shares purchased
on the basis of such returned check and cause the proceeds of such redemption
plus any dividends declared with respect to such shares to be credited to the
account of the Trust and to request the Trust's Custodian to forward such
returned check to the person who originally submitted the check; and
C. Notify the Trust of such actions and correct the
Trust's records maintained by Countrywide pursuant to this
Agreement.
12. DIVIDENDS AND DISTRIBUTIONS.
The Trust shall furnish Countrywide with appropriate evidence
of trustee action authorizing the declaration of dividends and other
distributions. Countrywide shall establish procedures in accordance with the
Trust's then current prospectus and statement of additional information and with
other authorized actions of the Trust's Board of Trustees under which it will
have available from the Custodian or the Trust any required information for each
dividend and other distribution. After deducting any amount required to be
withheld by any applicable laws, Countrywide shall, as agent for each
shareholder who so requests, invest the dividends and other distributions in
full and fractional shares in accordance with the Trust's then current
prospectus and statement of additional information. If a shareholder has elected
to receive dividends or other distributions in cash, then Countrywide shall
disburse dividends to shareholders of record in accordance with the Trust's then
current prospectus and statement of additional information. Countrywide shall,
on or before the mailing date of such checks, notify the Trust and the Custodian
of the estimated amount of cash required to pay such dividend or distribution,
and the Trust shall instruct the Custodian to make available sufficient funds
therefor in the appropriate account of the Trust. Countrywide shall mail to the
shareholders periodic statements, as requested by the Trust, showing the number
of full and fractional shares and the net asset value per share of shares so
credited. When requested by the Trust, Countrywide shall prepare and file with
the Internal Revenue Service, and when required, shall address and mail to
shareholders, such returns and information relating to dividends and
distributions paid by the Trust as are required to be so prepared, filed and
mailed by applicable laws, rules and regulations.
<PAGE>
13. UNCLAIMED DIVIDENDS AND UNCLAIMED REDEMPTION PROCEEDS.
Countrywide shall, at least annually, furnish in writing to
the Trust the names and addresses, as shown in the shareholder accounts
maintained by Countrywide, of all shareholders for which there are, as of the
end of the calendar year, dividends, distributions or redemption proceeds for
which checks or share certificates mailed in payment of distributions have been
returned. Countrywide shall use its best efforts to contact the shareholders
affected and to follow any other written instructions received from the Trust
concerning the disposition of any such unclaimed dividends, distributions or
redemption proceeds.
14. REDEMPTIONS AND EXCHANGES.
A. Countrywide shall process, in accordance with the Trust's
then current prospectus and statement of additional information, each order for
the redemption of shares accepted by Countrywide. Upon its approval of such
redemption transactions, Countrywide, if requested by the Trust, shall mail to
the shareholder and/or dealer of record a confirmation showing trade date,
number of full and fractional shares redeemed, the price per share and the total
redemption proceeds. For each such redemption, Countrywide shall either: (a)
prepare checks in the appropriate amounts for approval and verification by the
Trust and signature by an authorized officer of Countrywide and mail the checks
to the appropriate person, or (b) in the event redemption proceeds are to be
wired through the Federal Reserve Wire System or by bank wire, cause such
proceeds to be wired in federal funds to the bank account designated by the
shareholder, or (c) effectuate such other redemption procedures which are
authorized by the Trust's Board of Trustees or its then current prospectus and
statement of additional information. The requirements as to instruments of
transfer and other documentation, the applicable redemption price and the time
of payment shall be as provided in the then current prospectus and statement of
additional information, subject to such supplemental instructions as may be
furnished by the Trust and accepted by Countrywide. If Countrywide or the Trust
determines that a request for redemption does not comply with the requirements
for redemptions, Countrywide shall promptly notify the shareholder indicating
the reason therefor.
B. If shares of the Trust are eligible for exchange with
shares of any other investment company, Countrywide, in accordance with the then
current prospectus and statement of additional information and exchange rules of
the Trust and such other investment company, or such other investment company's
transfer agent, shall review and approve all exchange requests and shall, on
behalf of the Trust's shareholders, process such approved exchange requests.
<PAGE>
C. Countrywide shall notify the Trust, the Custodian and the
Underwriter on each business day of the amount of cash required to meet payments
made pursuant to the provisions of this Paragraph, and, on the basis of such
notice, the Trust shall instruct the Custodian to make available from time to
time sufficient funds therefor in the appropriate account of the Trust.
Procedures for effecting redemption orders accepted from shareholders or dealers
of record by telephone or other methods shall be established by mutual agreement
between Countrywide and the Trust consistent with the Trust's then current
prospectus and statement of additional information.
D. The authority of Countrywide to perform its
responsibilities under Paragraph 10, Paragraph 12, and this Paragraph 14 shall
be suspended with respect to any series of the Trust upon receipt of
notification by it of the suspension of the determination of such series' net
asset value.
15. WIRE-ORDER PURCHASES.
Countrywide will send written confirmations to the dealers of
record containing all details of the wire-order purchases placed by each such
dealer by the close of business on the business day following receipt of such
orders by Countrywide or the Underwriter, with copies to the Underwriter. Upon
receipt of any check drawn or endorsed to the Trust (or Countrywide, as agent)
or otherwise identified as being payment of an outstanding wire-order,
Countrywide will stamp said check with the date of its receipt and deposit the
amount represented by such check to Countrywide's deposit accounts maintained
with the Custodian. Countrywide will cause the Custodian to transfer federal
funds in an amount equal to the net asset value of the shares so purchased to
the Trust's account with the Custodian, and will notify the Trust and the
Underwriter before noon of each business day of the total amount deposited in
the Trust's deposit accounts, and in the event that payment for a purchase order
is not received by Countrywide or the Custodian on the tenth business day
following receipt of the order, prepare an NASD "notice of failure of dealer to
make payment" and forward such notification to the Underwriter.
16. OTHER PLANS.
Countrywide will process such accumulation plans, automatic
withdrawal plans, group programs and other plans or programs for investing in
shares of the Trust as are now provided for in the Trust's current prospectus
and statement of additional information and will act as plan agent for
shareholders pursuant to the terms of such plans and programs duly executed by
such shareholders.
<PAGE>
17. RECORDKEEPING AND OTHER INFORMATION.
Countrywide shall create and maintain all records required by
applicable laws, rules and regulations, including but not limited to records
required by Section 31(a) of the 1940 Act and the rules thereunder, as the same
may be amended from time to time, pertaining to the various functions performed
by it and not otherwise created and maintained by another party pursuant to
contract with the Trust. All such records shall be the property of the Trust at
all times and shall be available for inspection and use by the Trust. Where
applicable, such records shall be maintained by Countrywide for the periods and
in the places required by Rule 31a-2 under the 1940 Act. The retention of such
records shall be at the expense of the Trust. Countrywide shall make available
during regular business hours all records and other data created and maintained
pursuant to this Agreement for reasonable audit and inspection by the Trust, any
person retained by the Trust, or any regulatory agency having authority over the
Trust.
18. SHAREHOLDER RECORDS.
Countrywide shall maintain records for each shareholder
account showing the following:
A. Names, addresses and tax identifying numbers;
B. Name of the dealer of record, if any;
C. Number of shares held of each series;
D. Historical information regarding the account of each
shareholder, including dividends and distributions in
cash or invested in shares;
E. Information with respect to the source of all dividends
and distributions allocated among income, realized
short-term gains and realized long-term gains;
F. Any instructions from a shareholder including all forms
furnished by the Trust and executed by a shareholder
with respect to (i) dividend or distribution elections
and (ii) elections with respect to payment options in
connection with the redemption of shares;
G. Any correspondence relating to the current maintenance
of a shareholder's account;
H. Certificate numbers and denominations for any
shareholder holding certificates;
I. Any stop or restraining order placed against a
shareholder's account;
<PAGE>
J. Information with respect to withholding in the case of
a foreign account or any other account for which
withholding is required by the Internal Revenue Code of
1986, as amended; and
K. Any information required in order for Countrywide to
perform the calculations contemplated under this
Agreement.
19. TAX RETURNS AND REPORTS.
Countrywide will prepare in the appropriate form, file with
the Internal Revenue Service and appropriate state agencies and, if required,
mail to shareholders of the Trust such returns for reporting dividends and
distributions paid by the Trust as are required to be so prepared, filed and
mailed and shall withhold such sums as are required to be withheld under
applicable federal and state income tax laws, rules and regulations.
20. FORM N-SAR.
Countrywide shall maintain such records within its control and
shall be requested by the Trust to assist the Trust in fulfilling the
requirements of Form N-SAR.
21. OTHER INFORMATION TO THE TRUST.
Subject to such instructions, verification and approval of the
Custodian and the Trust as shall be required by any agreement or applicable law,
Countrywide will also maintain such records as shall be necessary to furnish to
the Trust the following: annual shareholder meeting lists, proxy lists and
mailing materials, shareholder reports and confirmations and checks for
disbursing redemption proceeds, dividends and other distributions or expense
disbursements.
22. COOPERATION WITH ACCOUNTANTS.
Countrywide shall cooperate with the Trust's independent
public accountants and shall take all reasonable action in the performance of
its obligations under this Agreement to assure that the necessary information is
made available to such accountants for the expression of their unqualified
opinion where required for any document for the Trust.
23. SHAREHOLDER SERVICE AND CORRESPONDENCE.
Countrywide will provide and maintain adequate personnel,
records and equipment to receive and answer all shareholder and dealer inquiries
relating to account status, share purchases, redemptions and exchanges and other
investment plans available to Trust shareholders. Countrywide will answer
written correspondence from shareholders relating to their share accounts and
such other written or oral inquiries as may from time to time be mutually agreed
upon, and Countrywide will notify
<PAGE>
the Trust of any correspondence or inquiries which may require an
answer from the Trust.
24. PROXIES.
Countrywide shall assist the Trust in the mailing of proxy
cards and other material in connection with shareholder meetings of the Trust,
shall receive, examine and tabulate returned proxies and shall, if requested by
the Trust, provide at least one inspector of election to attend and participate
as required by law in shareholder meetings of the Trust.
25. FURTHER ACTIONS.
Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
26. COMPENSATION.
For the performance of Countrywide's obligations under this
Agreement, each series of the Trust shall pay Countrywide, on the first business
day following the end of each month, a monthly fee in accordance with the
schedule attached hereto as Schedule A. Countrywide shall not be required to
reimburse the Trust or the Trust's investment adviser for (or have deducted from
its fees) any expenses in excess of expense limitations imposed by certain state
securities commissions having jurisdiction over the Trust. The Trust shall
promptly reimburse Countrywide for any out-of-pocket expenses and advances which
are to be paid by the Trust in accordance with Paragraph 27.
27. EXPENSES.
Countrywide shall furnish, at its expense and without cost to
the Trust (i) the services of its personnel to the extent that such services are
required to carry out its obligations under this Agreement and (ii) use of data
processing equipment. All costs and expenses not expressly assumed by
Countrywide under this Paragraph 27 shall be paid by the Trust, including, but
not limited to, costs and expenses of officers and employees of Countrywide in
attending meetings of the Board of Trustees and shareholders of the Trust, as
well as costs and expenses for postage, envelopes, checks, drafts, continuous
forms, reports, communications, statements and other materials, telephone,
telegraph and remote transmission lines, use of outside pricing services, use of
outside mailing firms, necessary outside record storage, media for storage of
records (e.g., microfilm, microfiche, computer tapes), printing, confirmations
and any other shareholder correspondence and any and all assessments, taxes or
levies assessed on Countrywide for services provided under this Agreement.
Postage for mailings of dividends, proxies, reports and other mailings to all
shareholders shall be advanced to Countrywide three business days prior to the
mailing date of such materials.
<PAGE>
28. REFERENCES TO COUNTRYWIDE.
The Trust shall not circulate any printed matter which
contains any reference to Countrywide without the prior written approval of
Countrywide, excepting solely such printed matter as merely identifies
Countrywide as Administrative Services Agent, Transfer, Shareholder Servicing
and Dividend Disbursing Agent and Accounting Services Agent. The Trust will
submit printed matter requiring approval to Countrywide in draft form, allowing
sufficient time for review by Countrywide and its counsel prior to any deadline
for printing.
29. EQUIPMENT FAILURES.
In the event of equipment failures beyond Countrywide's
control, Countrywide shall take all steps necessary to minimize service
interruptions but shall have no liability with respect thereto. Countrywide
shall endeavor to enter into one or more agreements making provision for
emergency use of electronic data processing equipment to the extent appropriate
equipment is available.
30. INDEMNIFICATION OF COUNTRYWIDE.
A. Countrywide may rely on information reasonably believed by it to be
accurate and reliable. Except as may otherwise be required by the 1940 Act and
the rules thereunder, neither Countrywide nor its shareholders, officers,
directors, employees, agents, control persons or affiliates of any thereof shall
be subject to any liability for, or any damages, expenses or losses incurred by
the Trust in connection with, any error of judgment, mistake of law, any act or
omission connected with or arising out of any services rendered under or
payments made pursuant to this Agreement or any other matter to which this
Agreement relates, except by reason of willful misfeasance, bad faith or
negligence on the part of any such persons in the performance of the duties of
Countrywide under this Agreement or by reason of reckless disregard by any of
such persons of the obligations and duties of Countrywide under this Agreement.
B. Notwithstanding any other provision of this Agreement, the Trust
shall indemnify and hold harmless Countrywide, its directors, officers,
employees, shareholders, agents, control persons and affiliates from and against
any and all claims, demands, expenses and liabilities (whether with or without
basis in fact or law) of any and every nature which Countrywide may sustain or
incur or which may be asserted against Countrywide by any person by reason of,
or as a result of: (i) any action taken or omitted to be taken by Countrywide in
good faith in reliance upon any certificate, instrument, order or share
certificate believed by it to be genuine and to be signed, countersigned or
executed by any duly authorized person, upon the oral instructions or written
instructions of an authorized person of the Trust or upon the opinion of legal
counsel for the Trust or
<PAGE>
its own counsel; or (ii) any action taken or omitted to be taken by Countrywide
in connection with its appointment in good faith in reliance upon any law, act,
regulation or interpretation of the same even though the same may thereafter
have been altered, changed, amended or repealed. However, indemnification under
this subparagraph shall not apply to actions or omissions of Countrywide or its
directors, officers, employees, shareholders or agents in cases of its or their
own negligence, willful misconduct, bad faith, or reckless disregard of its or
their own duties hereunder.
31. TERMINATION
A. The provisions of this Agreement shall be effective on the
date first above written, shall continue in effect for three years from that
date and shall continue in force from year to year thereafter, but only so long
as such continuance is approved (1) by Countrywide, (2) by vote, cast in person
at a meeting called for the purpose, of a majority of the Trust's trustees who
are not parties to this Agreement or interested persons (as defined in the 1940
Act) of any such party, and (3) by vote of a majority of the Trust's Board of
Trustees or a majority of the Trust's outstanding voting securities.
B. Either party may terminate this Agreement on any date by
giving the other party at least sixty (60) days' prior written notice of such
termination specifying the date fixed therefore. Upon termination of this
Agreement, the Trust shall pay to Countrywide such compensation as may be due as
of the date of such termination, and shall likewise reimburse Countrywide for
any out-of-pocket expenses and disbursements reasonably incurred by Countrywide
to such date.
C. In the event that in connection with the termination of
this Agreement a successor to any of Countrywide's duties or responsibilities
under this Agreement is designated by the Trust by written notice to
Countrywide, Countrywide shall, promptly upon such termination and at the
expense of the Trust, transfer all records maintained by Countrywide under this
Agreement and shall cooperate in the transfer of such duties and
responsibilities, including provision for assistance from Countrywide's
cognizant personnel in the establishment of books, records and other data by
such successor.
32. SERVICES FOR OTHERS.
Nothing in this Agreement shall prevent Countrywide or any
affiliated person (as defined in the 1940 Act) of Countrywide from providing
services for any other person, firm or corporation (including other investment
companies); provided, however, that Countrywide expressly represents that it
will undertake no activities which, in its judgment, will adversely affect the
performance of its obligations to the Trust under this Agreement.
<PAGE>
33. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS.
The parties hereto acknowledge and agree that nothing
contained herein shall be construed to require Countrywide to perform any
services for the Trust which services could cause Countrywide to be deemed an
"investment adviser" of the Trust within the meaning of Section 2(a)(20) of the
1940 Act or to supersede or contravene the Trust's prospectus or statement of
additional information or any provisions of the 1940 Act and the rules
thereunder. Except as otherwise provided in this Agreement and except for the
accuracy of information furnished to it by Countrywide, the Trust assumes full
responsibility for complying with all applicable requirements of the 1940 Act,
the Securities Act of 1933, as amended, and any other laws, rules and
regulations of governmental authorities having jurisdiction.
34. LIMITATION OF LIABILITY.
It is expressly agreed that the obligations of the Trust
hereunder shall not be binding upon any of the Trustees, shareholders, nominees,
officers, agents or employees of the Trust, personally, but bind only the trust
property of the Trust. The execution and delivery of this Agreement have been
authorized by the Trustees of the Trust and signed by an officer of the Trust,
acting as such, and neither such authorization by such Trustees nor such
execution and delivery by such officer shall be deemed to have been made by any
of them individually or to impose any liability on any of them personally, but
shall bind only the trust property of the Trust.
35. SEVERABILITY.
In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect the remainder of
this Agreement, which shall continue to be in force.
36. QUESTIONS OF INTERPRETATION.
This Agreement shall be governed by the laws of the State of
Ohio. Any question of interpretation of any term or provision of this Agreement
having a counterpart in or otherwise derived from a term or provision of the
1940 Act shall be resolved by reference to such term or provision of the 1940
Act and to interpretations thereof, if any, by the United States Courts or in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the SEC issued pursuant to said 1940 Act. In addition, where the
effect of a requirement of the 1940 Act, reflected in any provision of this
Agreement, is revised by rule, regulation or order of the SEC, such provision
shall be deemed to incorporate the effect of such rule, regulation or order.
<PAGE>
37. NOTICES.
All notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing (including telex
and telegraphic communication) and shall be (as elected by the person giving
such notice) hand delivered by messenger or courier service, telecommunicated,
or mailed (airmail if international) by registered or certified mail (postage
prepaid), return receipt requested, addressed to:
To the Trust: Williamsburg Investment Trust
c/o Lowe, Brockenbrough & Tattersall, Inc.
6620 West Broad Street, Suite 300
Richmond, Virginia 23230
Attention: Craig D. Truitt
To Countrywide:Countrywide Fund Services, Inc.
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202
Attention: Robert G. Dorsey
or to such other address as any party may designate by notice complying with the
terms of this Section 37. Each such notice shall be deemed delivered (a) on the
date delivered if by personal delivery; (b) on the date telecommunicated if by
telegraph; (c) on the date of transmission with confirmed answer back if by
telex, telefax or other telegraphic method; and (d) on the date upon which the
return receipt is signed or delivery is refused or the notice is designated by
the postal authorities as not deliverable, as the case may be, if mailed.
38. AMENDMENT.
This Agreement may not be amended or modified except by a
written agreement executed by both parties.
39. GOVERNING LAW.
This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
40. BINDING EFFECT.
Each of the undersigned expressly warrants and represents that
he has the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party indicated
to the foregoing terms.
41. COUNTERPARTS.
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
<PAGE>
42. FORCE MAJEURE.
If Countrywide shall be delayed in its performance of services
or prevented entirely or in part from performing services due to causes or
events beyond its control, including and without limitation, acts of God,
interruption of power or other utility, transportation or communication
services, acts of civil or military authority, sabotages, national emergencies,
explosion, flood, accident, earthquake or other catastrophe, fire, strike or
other labor problems, legal action, present or future law, governmental order,
rule or regulation, or shortages of suitable parts, materials, labor or
transportation, such delay or non-performance shall be excused and a reasonable
time for performance in connection with this Agreement shall be extended to
include the period of such delay or non-performance.
43. MISCELLANEOUS.
The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
WILLIAMSBURG INVESTMENT TRUST
By: /S/ JOHN T. BRUCE
Its: Chairman of the Board
COUNTRYWIDE FUND SERVICES, INC.
By:/S/ ROBERT G. DORSEY
Its: President
<PAGE>
SCHEDULE A
COMPENSATION
The Jamestown Balanced Fund Payable monthly at annual rate
of .2% of average daily net
assets up to $25 million;
.175% of such assets from $25
million to $50 million; and
.15% of such assets in excess
of $50 million; subject to
minimum $2,000 per month
The Jamestown Equity Fund Payable monthly at annual rate
of .2% of average daily net
assets up to $25 million;
.175% of such assets from $25
million to $50 million; and
.15% of such assets in excess
of $50 million; subject to
minimum $2,000 per month
The Jamestown Tax Exempt Payable monthly at annual rate
Virginia Fund of .15% of average daily net
assets up to $200 million; and
.1% of such assets in excess
of $200 million; subject to
minimum $2,000 per month
The Jamestown Bond Fund Payable monthly at annual rate
of .075% of average daily net
assets up to $200 million; and
.05% of such assets in excess
of $200 million; subject to
minimum $2,000 per month
The Jamestown Short Term Payable monthly at annual rate
Bond Fund of .075% of average daily net
assets up to $200 million; and
.05% of such assets in excess
of $200 million; subject to
minimum $2,000 per month
The Jamestown International Payable monthly at annual rate
Equity Fund of .25% of average daily net
assets up to $25 million;
.225% of such assets from
$25 million to $50
million; and .2%
of such assets in excess of $50
million; subject to minimum
$4,000 per month
<PAGE>
COMPENSATION
(continued)
FBP Contrarian Equity Fund Payable monthly at annual rate
of .2% of average daily net
assets up to $25 million;
.175% of such assets from $25
million to $50 million; and
.15% of such assets in excess
of $50 million; subject to
minimum $2,000 per month
FBP Contrarian Balanced Fund Payable monthly at annual rate
of .2% of average daily net
assets up to $25 million;
.175% of such assets from $25
million to $50 million; and
.15% of such assets in excess
of $50 million; subject to
minimum $2,000 per month
The Government Street Payable monthly at annual rate
Equity Fund of .2% of average daily net
assets up to $25
million; .175% of
such assets from
$25 million to $50
million; and .15%
of such assets in
excess of $50
million; subject
to minimum $2,000
per month
The Government Street Payable monthly at annual rate
Bond Fund of .075% of average daily net
assets up to $200 million; and
.05% of such assets in excess
of $200 million; subject to
minimum $2,000 per month
The Alabama Tax Free Payable monthly at annual rate
Bond Fund of .15% of average daily net
assets up to $200 million; and
.1% of such assets in excess
of $200 million; subject to
minimum $2,000 per month
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the references to our firm in the Post- Effective
Amendment No. 28 to the Registration Statement on Form N-1A of Williamsburg
Investment Trust and to the use of our reports each dated April 25, 1997 on the
financial statements and financial highlights of The Jamestown Bond Fund and The
Jamestown Short Term Bond Fund, each a series of shares of Williamsburg
Investment Trust. Such financial statements and financial highlights appear in
the 1997 Annual Report to Shareholders which accompanies the Statement of
Additional Information.
/s/ Tait, Weller & Baker
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
June 25, 1997
PLAN OF DISTRIBUTION
PURSUANT TO RULE 12B-1 FOR
RETAIL SHARES OF THE JAMESTOWN BOND FUND
THE JAMESTOWN SHORT TERM BOND FUND
WHEREAS, Williamsburg Investment Trust (the "Trust"), an unincorporated
business trust organized under the laws of the Commonwealth of Massachusetts, is
an open-end management investment company and is registered as such under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue an unlimited number of shares
of beneficial interest without par value (the "Shares"), which are divided into
separate series of Shares; and
WHEREAS, the Jamestown Bond Fund and The Jamestown Short
Term Bond Fund (the "Funds") are series of the Trust; and
WHEREAS, the Trust issues shares of the Funds in Classes
(one of which may be designated as Retail Shares); and
WHEREAS, the Trustees of the Trust as a whole, and the Trustees who are
not interested persons of the Trust (as defined in the 1940 Act) and who have no
direct or indirect financial interest in the operation of this Plan or in any
agreement relating hereto (the "Rule 12b-1 Trustees"), having determined, in the
exercise of reasonable business judgment and in light of their fiduciary duties
under state law and under Section 36(a) and (b) of the 1940 Act, that there is a
reasonable likelihood that this Plan will benefit each Fund and the holders of
its Consultant Shares, have approved this Plan by votes cast in person at a
meeting called for the purpose of voting hereon and on any agreements related
hereto;
NOW, THEREFORE, the Trust hereby adopts this Plan for the Retail Shares
of the Funds in accordance with Rule 12b-1 under the 1940 Act, on the following
terms and conditions:
1. DISTRIBUTION ACTIVITIES. Subject to the supervision of the Trustees
of the Trust, the Funds may, directly or indirectly, engage in any activities
related to the distribution of Retail Shares, which activities may include, but
are not limited to, the following: (a) payments to securities dealers and others
who are engaged in the sale of Retail Shares and who may be advising
shareholders of the Funds regarding the purchase, sale or retention of Retail
Shares; (b) expenses of maintaining personnel (including personnel of
organizations with which the Funds have entered into agreements related to this
Plan) who engage in or support distribution of Retail Shares or who render
shareholder support services not otherwise provided by the Funds' transfer
agent, including, but not limited to, office space and equipment,
telephone facilities and expenses, answering routine inquiries regarding the
Funds, processing shareholder transactions, and providing such other shareholder
services as the Funds may reasonably request; (c) formulating and implementing
of marketing
<PAGE>
and promotional activities, including, but not limited to, direct mail
promotions and television, radio, newspaper, magazine and other mass media
advertising; (d) preparing, printing and distributing sales literature;
(e)preparing, printing and distributing prospectuses and statements of
additional information and reports of the Funds for recipients other than
existing shareholders of the Funds; and (f) obtaining such information, analyses
and reports with respect to marketing and promotional activities as the Funds
may, from time to time, deem advisable. The Funds are authorized to engage in
the activities listed above, and in any other activities related to the
distribution of Retail Shares, either directly or through other persons with
which the Trust have entered into agreements related to this Plan.
2. MAXIMUM EXPENDITURES. The expenditures to be made pursuant to this
Plan and the basis upon which payment of such expenditures will be made shall be
determined by the Trustees of the Trust, but in no event may such expenditures
exceed in any fiscal year an amount calculated at the rate of .10% of the
average daily net asset value of the Retail Shares of any Fund. Such payments
for distribution activities may be made directly by the Retail Shares or the
Trust's investment adviser may incur such expenses and obtain reimbursement from
the Retail Shares.
3. TERM AND TERMINATION. This Plan shall become effective on the date
hereof. Unless terminated as herein provided, this Plan shall continue in effect
for one year from the date hereof and shall continue in effect for successive
periods of one year thereafter, but only so long as each such continuance is
specifically approved by votes of a majority of both (i) the Trustees of the
Trust and (ii) the Rule 12b-1 Trustees, cast in person at a meeting called for
the purpose of voting on such approval. This Plan may be terminated with respect
to any Fund at any time by vote of a majority of the Rule 12b-1 Trustees or by
vote of a majority (as defined in the 1940 Act) of the outstanding Retail Shares
of such Series of the Trust.
4. AMENDMENTS. This Plan may not be amended with respect to any Fund to
increase materially the amount of expenditures provided for in Section 2 hereof
unless such amendment is approved by a vote of the majority (as defined in the
1940 Act) of the outstanding Retail Shares of such Fund, and no material
amendment to this Plan shall be made unless approved in the manner provided for
annual renewal of this Plan in Section 3 hereof.
- 50 -
<PAGE>
5. SELECTION AND NOMINATION OF TRUSTEES. While this Plan
is in effect, the selection and nomination of Trustees who are
not interested persons (as defined in the 1940 Act) of the Trust
shall be committed to the discretion of the Trustees who are not
interested persons of the Trust.
6. QUARTERLY REPORTS. The Treasurer of the Trust shall provide to the
Trustees and the Trustees shall review, at least quarterly, a written report of
the amounts expended pursuant to this Plan and any related agreement, the
purposes for which such expenditures were made and the allocation of such
expenditures as provided for in Section 7.
7. ALLOCATING EXPENDITURES BETWEEN CLASSES. Only
distribution expenditures properly attributable to the sale of
Consultant Shares may be used to support the distribution fee
charged to shareholders of such class of Shares. For this
purpose, Consultant Shares issued upon reinvestment of dividends
or distributions will not be considered sales.
8. RECORDKEEPING. The Trust shall preserve copies of this Plan and any
related agreement and all reports made pursuant to Section 6 hereof, for a
period of not less than six years from the date of this Plan, the agreements or
such reports, as the case may be, the first two years in an easily accessible
place.
9. LIMITATION OF LIABILITY. A copy of the Agreement and Declaration of
Trust of the Trust is on file with the Secretary of the Commonwealth of
Massachusetts and notice is hereby given that this Plan is executed on behalf of
the Trustees of the Trust as trustees and not individually and that the
obligations of this instrument are not binding upon the Trustees or shareholders
of the Trust individually but are binding only upon the assets and property of
the Trust.
IN WITNESS WHEREOF, the Trust has caused this Plan to be executed as of
the date set forth below.
Dated: , 1997
Attest:
_______________________________ By: __________________________
Secretary Chairman
- 51 -
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000842512
<NAME> WILLIAMSBURG INVESTMENT TRUST
<SERIES>
<NUMBER> 3
<NAME> THE JAMESTOWN BOND FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> MAR-31-1997
<INVESTMENTS-AT-COST> 77,612,798
<INVESTMENTS-AT-VALUE> 77,102,249
<RECEIVABLES> 2,333,079
<ASSETS-OTHER> 2,411
<OTHER-ITEMS-ASSETS> 77
<TOTAL-ASSETS> 79,437,816
<PAYABLE-FOR-SECURITIES> 2,868,614
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 69,708
<TOTAL-LIABILITIES> 2,938,322
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 78,515,550
<SHARES-COMMON-STOCK> 7,454,249
<SHARES-COMMON-PRIOR> 7,195,530
<ACCUMULATED-NII-CURRENT> 23,476
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,528,983)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (510,549)
<NET-ASSETS> 76,499,494
<DIVIDEND-INCOME> 533,969
<INTEREST-INCOME> 4,858,959
<OTHER-INCOME> 0
<EXPENSES-NET> 386,977
<NET-INVESTMENT-INCOME> 5,005,951
<REALIZED-GAINS-CURRENT> (391,414)
<APPREC-INCREASE-CURRENT> (405,910)
<NET-CHANGE-FROM-OPS> 4,208,627
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 5,104,234
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 892,247
<NUMBER-OF-SHARES-REDEEMED> 1,043,163
<SHARES-REINVESTED> 409,635
<NET-CHANGE-IN-ASSETS> 1,725,375
<ACCUMULATED-NII-PRIOR> 121,759
<ACCUMULATED-GAINS-PRIOR> (1,137,569)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 289,094
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 409,903
<AVERAGE-NET-ASSETS> 77,255,314
<PER-SHARE-NAV-BEGIN> 10.39
<PER-SHARE-NII> .68
<PER-SHARE-GAIN-APPREC> (.12)
<PER-SHARE-DIVIDEND> .69
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.26
<EXPENSE-RATIO> .53
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000842512
<NAME> WILLIAMSBURG INVESTMENT TRUST
<SERIES>
<NUMBER> 6
<NAME> THE JAMESTOWN SHORT TERM BOND FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> MAR-31-1997
<INVESTMENTS-AT-COST> 9,882,914
<INVESTMENTS-AT-VALUE> 9,831,978
<RECEIVABLES> 94,993
<ASSETS-OTHER> 351
<OTHER-ITEMS-ASSETS> 156
<TOTAL-ASSETS> 9,927,478
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,000
<TOTAL-LIABILITIES> 3,000
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 10,519,030
<SHARES-COMMON-STOCK> 1,032,909
<SHARES-COMMON-PRIOR> 969,934
<ACCUMULATED-NII-CURRENT> 2,632
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (546,248)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (50,936)
<NET-ASSETS> 9,924,478
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 630,476
<OTHER-INCOME> 0
<EXPENSES-NET> 48,642
<NET-INVESTMENT-INCOME> 581,834
<REALIZED-GAINS-CURRENT> (101,843)
<APPREC-INCREASE-CURRENT> (3,365)
<NET-CHANGE-FROM-OPS> 476,626
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 582,861
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 226,810
<NUMBER-OF-SHARES-REDEEMED> 224,329
<SHARES-REINVESTED> 60,494
<NET-CHANGE-IN-ASSETS> 498,722
<ACCUMULATED-NII-PRIOR> 3,659
<ACCUMULATED-GAINS-PRIOR> (444,405)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 36,481
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 91,987
<AVERAGE-NET-ASSETS> 9,749,610
<PER-SHARE-NAV-BEGIN> 9.72
<PER-SHARE-NII> .58
<PER-SHARE-GAIN-APPREC> (.11)
<PER-SHARE-DIVIDEND> .58
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.61
<EXPENSE-RATIO> .50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
RULE 18f-3 PLAN ADOPTED WITH RESPECT TO THE MULTIPLE CLASS
DISTRIBUTION SYSTEM OF THE JAMESTOWN BOND FUND
AND THE JAMESTOWN SHORT TERM BOND FUND
The Jamestown Bond Fund and the Jamestown Short Term Bond Fund (the
"Funds"), each a series of Williamsburg Investment Trust (the "Trust"), have
adopted this Plan pursuant to Rule 18f-3 promulgated under the Investment
Company Act of 1940 (the "1940 Act"). The Trust is an open-end management
investment company registered under the 1940 Act. Lowe, Brockenbrough &
Tattersall Strategic Advisors, Inc. (the "Advisor") provides investment advisory
and management services to the Funds.
This Plan permits the Funds to issue and sell two classes of shares
for the purpose of establishing a multiple class distribution system (the
"Multiple Class Distribution System"). These guidelines set forth the conditions
pursuant to which the Multiple Class Distribution System will operate and the
duties and responsibilities of the Trustees of the Trust with respect to the
Multiple Class Distribution System. DESCRIPTION OF THE MULTIPLE CLASS
DISTRIBUTION SYSTEM
The Multiple Class Distribution System enables each Fund to offer
investors the option of purchasing shares in one of two manners: (1) subject to
a distribution fee not to exceed .15% of average net assets (Consultant shares);
(2) subject to no distribution fee (Institutional shares).
The two classes will each represent interests in the same portfolio of
investments of a Fund. The two classes will be identical except that (i) only
the Consultant shares of a Fund willburg\classpln.jms
- 52 -
<PAGE>
will incur the distribution fees payable pursuant to the distribution plan
adopted by the Funds in accordance with Rule 12b-1 under the 1940 Act (Rule
12b-1 distribution plan); (ii) each class may bear different Class Expenses (as
defined below); (iii) the Consultant shares will vote separately as a class with
respect to the Funds' Rule 12b-1 distribution plan; and (iv) each class may bear
a different name or designation.
Investors purchasing Consultant shares will do so at net asset value.
Each Fund will also pay a distribution fee pursuant to the Rule 12b-1
distribution plan at an annual rate of up to .15% of the average daily net asset
value of its Consultant shares. Investors purchasing Institutional shares will
do so at net asset value per share without being subject to a distribution fee
pursuant to a Rule 12b-1 distribution plan.
Under the Funds' Rule 12b-1 distribution plan, payments will be made
for expenses incurred in providing distribution-related services. Each Fund will
accrue at a rate (but not in excess of the applicable maximum percentage rate)
which is reviewed by the Trust's Board of Trustees quarterly. Such rate is
intended to provide for accrual of expenses at a rate that will not exceed the
unreimbursed amounts actually expended for distribution by a Fund. If at any
time the amount accrued by a Fund would exceed the amount of distribution
expenses incurred with respect to such Fund during the fiscal year, then the
rate of accrual will be adjusted accordingly. In no event will the amount paid
by the Funds exceed the unreimbursed expenses previously incurred in providing
distribution-related services.
- 53 -
<PAGE>
Proceeds from the distribution fee will be used to compensate financial
intermediaries with a service fee based upon a percentage of the average daily
net asset value of the shares maintained in the Funds by their customers and to
defray the expenses of the Advisor with respect to providing distribution
related services.
Both classes of shares of each Fund will have identical voting,
dividend, liquidation and other rights, preferences, powers, restrictions,
limitations, qualifications, designations and terms and conditions, except for
the differences mentioned above.
Under the Multiple Class Distribution System, the Board of Trustees
could determine that any of certain expenses attributable to the shares of a
particular class of shares will be borne by the class to which they were
attributable ("Class Expenses"). Class Expenses are limited to (a) transfer
agency fees identified by the Trust as being attributable to a class of shares;
(b) printing and postage expenses related to preparing and distributing
materials such as shareholder reports, prospectuses and proxy statements to
current shareholders of a specific class; (c) SEC and Blue Sky registration fees
incurred by a class of shares; (d) the expenses of administrative personnel and
services as required to support the shareholders of a specific class; (e)
litigation or other legal expenses relating to a specific class of shares; (f)
Trustees' fees or expenses incurred as a result of issues relating to a specific
class of shares; (g) accounting fees and expenses relating to a specific
- 54 -
<PAGE>
class of shares; and (h) additional incremental expenses not specifically
identified above that are subsequently identified and determined to be properly
allocated to one class of shares and approved by the Board of Trustees.
Under the Multiple Class Distribution System, certain expenses could be
attributable to more than one Fund ("Trust Expenses"). All such Trust Expenses
would be first allocated among the Funds, based on the aggregate net assets of
such Funds, and then borne on such basis by each Fund and without regard to
class. Expenses that were attributable to a particular Fund but not to a
particular class thereof ("Series Expenses"), would be borne by each class on
the basis of the net assets of such class in relation to the aggregate net
assets of the Fund.
Subject to the approval of the Board of Trustees, certain expenses may
be applied differently if their current application becomes no longer
appropriate. For example, if a Class Expense is no longer attributable to a
specific class, it may be charged to the applicable Fund or Funds, as
appropriate. In addition, if application of all or a portion of a particular
expense to a class is determined by the Internal Revenue Service or counsel to
the Trust to result in a preferential dividend for which, pursuant to Section
562(c) of the Internal Revenue Code of 1986, as amended (the "Code"), a Fund
would not be entitled to a dividends paid deduction, all or a portion of the
expense may be treated as a Series Expense or a Trust Expense. Similarly, if a
Trust Expense becomes attributable to a specific Fund it may be treated as a
Series Expense.
- 55 -
<PAGE>
Because of the varying distribution fees and Class Expenses that may be
borne by each class of shares, the net income of (and dividends payable with
respect to) one class may be different from the net income of (and dividends
payable with respect to) the other class of shares of a Fund. Dividends paid to
holders of each class of shares in a Fund would, however, be declared and paid
on the same days and at the same times and, except as noted with respect to the
varying distribution fees and Class Expenses, would be determined and paid in
the same manner. To the extent that a Fund has undistributed net income, the net
asset value per share of each class of such Fund's shares will vary.
The salient features of the Multiple Class Distribution System will be
described in the Funds' prospectus. Each Fund will disclose the respective
expenses, performance data, distribution arrangements, services and fees
applicable to each class of shares offered through that prospectus. The
shareholder reports of each Fund will disclose the respective expenses and
performance data applicable to each class of shares. The shareholder reports
will contain, in the statement of assets and liabilities and statement of
operations, information related to the Fund as a whole generally and not on a
per class basis. Each Fund's per share data, however, will be prepared on a per
class basis with respect to all classes of shares of such Fund. The information
provided by the Advisor for publication in any newspaper or similar listing of
the Funds' net asset values will separately present Consultant and Institutional
shares.
The Consultant alternative is designed to permit the
- 56 -
<PAGE>
investor to purchase Consultant shares without the assessment of a sales
load and at the same time permit the Funds to pay financial intermediaries
selling shares of the Funds a service fee on the sale of the Consultant shares.
Proceeds from the distribution fee will be used to compensate financial
intermediaries with a service fee and to defray the expenses of the Advisor with
respect to providing distribution related services.
LEGAL ANALYSIS
The Advisor believes that the Multiple Class Distribution System as
described herein will better enable the Funds to meet the competitive demands of
today's financial services industry. The System permits the Funds to facilitate
the distribution of their securities without assuming excessive accounting and
bookkeeping costs.
The allocation of expenses and voting rights relating to the Rule 12b-1
plan in the manner described is equitable and does not discriminate against any
group of shareholders. In addition, such arrangements should not give rise to
any conflicts of interest because the rights and privileges of each class of
shares are substantially identical.
The Advisor believes that the Multiple Class Distribution System will
not increase the speculative character of the shares of the Funds. The Multiple
Class Distribution System does not involve borrowing, nor will it affect the
Funds' existing assets or reserves, and does not involve a complex capital
structure. Nothing in the Multiple Class Distribution System suggests that
- 57 -
<PAGE>
it will facilitate control by holders of any class of shares. CONDITIONS OF
OPERATING UNDER THE MULTIPLE CLASS DISTRIBUTION SYSTEM
The operation of the Multiple Class Distribution System shall at all
times be in accordance with Rule 18f-3 under the 1940 Act and all other
applicable laws and regulations, and in addition, shall be subject to the
following conditions:
1. Each class of shares will represent interests in the same portfolio
of investments of a Fund, and be identical in all material respects, except as
set forth below. The only differences among the various classes of a Fund will
relate solely to: (a) the impact of the Rule 12b-1 distribution plan payments
allocated to the Consultant shares of a Fund; (b) Class Expenses, which are
limited to (i) transfer agency fees, (ii) printing and postage expenses related
to preparing and distributing materials such as shareholder reports,
prospectuses and proxies to current shareholders of a specific class, (iii) SEC
and Blue Sky registration fees incurred by a class of shares, (iv) the expenses
of administrative personnel and services as required to support the shareholders
of a specific class, (v) litigation or other legal expenses relating to a
specific class of shares, (vi) Trustees' fees or expenses incurred as a result
of issues relating to a specific class of shares, and (vii) accounting fees and
expenses relating to a specific class of shares; (c) the fact that each will
vote separately as a class with respect to any matter affecting only that class,
including the Funds' Rule 12b-1 distribution plan; and (d) the designation of
each class of shares of the Funds. Any additional incremental
- 58 -
<PAGE>
expenses not specifically identified above that are subsequently identified and
determined to be properly allocated to one class of shares shall not be so
allocated until approved by the Board of Trustees.
2. The Trustees of the Trust, including a majority of the Trustees who
are not interested persons of the Trust, have approved this Plan as being in the
best interests of each class individually and each Fund as a whole. In making
this finding, the Trustees evaluated the relationship among the classes, the
allocation of expenses among the classes, potential conflicts of interest among
classes, and the level of services provided to each class and the cost of those
services.
3. Any material changes to this Plan, including but not limited to a
change in the method of determining Class Expenses that will be applied to a
class of shares, will be reviewed and approved by votes of the Board of Trustees
of the Trust, including a majority of the Trustees who are not interested
persons of the Trust.
4. On an ongoing basis, the Trustees of the Trust, pursuant to their
fiduciary responsibilities under the 1940 Act and otherwise, will monitor each
Fund for the existence of any material conflicts between the interests of the
classes of shares. The Trustees, including a majority of the Trustees who are
not interested persons of the Trust, shall take such action as is reasonably
necessary to eliminate any such conflicts that may develop. The Advisor will be
responsible for reporting any potential or existing conflicts to the Trustees.
If a conflict
- 59 -
<PAGE>
arises, the Advisor at its own cost will remedy such conflict up to and
including establishing a new registered management investment company.
5. The Trustees of the Trust will receive quarterly and annual
Statements complying with paragraph (b)(3)(ii) of Rule 12b-1, as it may be
amended from time to time. In the Statements, only distribution expenditures
properly attributable to the sale of Consultant shares will be used to support
the Rule 12b-1 fee charged to shareholders of Consultant shares. Expenditures
not related to the sale of a particular class will not be presented to the
Trustees to justify any fee attributable to that class. The Statements,
including the allocations upon which they are based, will be subject to the
review and approval of the independent Trustees in the exercise of their
fiduciary duties.
6. Dividends paid by a Fund with respect to each class of shares, to
the extent any dividends are paid, will be calculated in the same manner, at the
same time, on the same day, and will be in the same amount, except that
distribution fee payments and Class Expenses relating to each respective class
of shares will be borne exclusively by that class.
7. The Advisor has established the manner in which the net asset value
of the multiple classes of shares will be determined and the manner in which
dividends and distributions will be paid. Attached hereto as Exhibit A is a
procedures memorandum and worksheets with respect to the methodology and
procedures for calculating the net asset value and dividends and distributions
- 60 -
<PAGE>
of the various classes and the proper allocation of income and
expenses among the classes.
8. The Advisor represents that it has in place, and will continue to
maintain, adequate facilities in place to ensure implementation of the
methodology and procedures for calculating the net asset value and dividends and
distributions among the various classes of shares.
9. If a Fund offers separate classes of shares through separate
prospectuses, each such prospectus will disclose (i) that the Fund issues other
classes, (ii) that those other classes may have different sales charges and
other expenses, which may affect performance, (iii) a telephone number investors
may call to obtain more information concerning the other classes available to
them through their sales representative, and (iv) that investors may obtain
information concerning those classes from their sales representative or the
Advisor.
10. The Funds will briefly describe the salient features of the
Multiple Class Distribution System in their prospectus. Each Fund will disclose
the respective expenses, performance data, distribution arrangements, services
and fees applicable to each class of shares offered through that prospectus.
Each Fund will disclose the respective expenses and performance data applicable
to each class of shares in every shareholder report. The shareholder reports
will contain, in the statement of assets and liabilities and statement of
operations, information related to the Fund as a whole generally and not on a
per class basis. Each Fund's per share data, however, will be prepared on a per
class
- 61 -
<PAGE>
basis with respect to all classes of shares of such Fund. The information
provided by the Advisor for publication in any newspaper or similar listing of
the Funds' net asset values will separately present Consultant and Institutional
shares.
- 62 -
<PAGE>
EXHIBIT A
THE JAMESTOWN BOND FUND
THE JAMESTOWN SHORT TERM BOND FUND
MULTIPLE-CLASS FUNDS
METHODOLOGY, PROCEDURES
AND
INTERNAL ACCOUNTING CONTROLS
<PAGE>
INTRODUCTION
The Jamestown Bond Fund and The Jamestown Short Term Bond Fund (the
"Funds") are each a series of Williamsburg Investment Trust (the "Trust"), a
Massachusetts business trust registered under the Investment Company Act of 1940
as open-end management investment company. Lowe, Brockenbrough and Tattersall
Strategic Advisors, Inc. (the "Advisor") acts as the investment manager to the
Funds.
Each Fund may offer multiple classes of shares as more fully described
in the Funds' Rule 18f-3 Plan. The Multiple Class Distribution System would
enable each Fund to offer investors the option of purchasing shares in one of
two manners: (1) subject to a distribution fee not to exceed .15% of average net
assets (Consultant shares); or (2) subject to no distribution fee (Institutional
shares). Each Fund expects to distribute substantially all of its net investment
income, if any, on a quarterly basis. Future series of the Trust may declare
dividends daily or periodically. The Funds and any future series of the Trust
will declare and pay substantially all net realized gains, if any, at least
annually.
Pursuant to an Administration, Accounting and Transfer Agency
Agreement, Countrywide Fund Services, Inc. ("Countrywide") maintains the Funds'
accounting records and performs the daily calculations of each Fund's net asset
value. Thus the procedures and internal accounting controls for the Funds
include the participation of Countrywide.
The internal accounting control environment at Countrywide provides for
minimal risk of error. This has been accomplished through the use of competent
and well-trained employees, adequate facilities and established internal
accounting control procedures.
Additional procedures and internal accounting controls have been
designed for the multiple class funds. These procedures and internal accounting
controls have been reviewed by management of the Funds and Countrywide to ensure
that the risks associated with multiple-class funds are adequately addressed.
The specific internal accounting control objectives and the related
methodology, procedures and internal accounting controls to achieve these stated
objectives are outlined below.
- 1 -
<PAGE>
METHODOLOGY, PROCEDURES AND INTERNAL
ACCOUNTING CONTROLS FOR MULTIPLE-CLASS FUNDS
The three internal accounting control objectives to be achieved are:
(1) The daily net asset value for all classes of shares of
each Fund is accurately calculated.
(2) Recorded expenses of a Fund are properly allocated
between each class of shares.
(3) Dividend distributions are accurately calculated for
each class of shares.
1. Control Objective
The daily net asset value for all classes of shares of each Fund is
accurately calculated.
METHODOLOGY, PROCEDURES AND INTERNAL ACCOUNTING CONTROLS
a. Securities of the Funds will be valued daily at their current
market value by a reputable pricing source. Security positions
will be reconciled from the Funds' records and to custody
records and reviewed for completeness and accuracy.
b. Prepaid and intangible assets will be amortized over their
estimated useful lives. These assets will be reviewed monthly
to ensure a proper presentation and amortization during the
period.
c. Investment income, realized and unrealized gains or losses
will be calculated daily from Countrywide's portfolio system
and reconciled to the general ledger. Yields and fluctuations
in security prices will be monitored on a daily basis by
Countrywide personnel. Interest and dividend receivable
amounts will be reconciled to holdings reports.
d. An estimate of all expenses for each Fund will be
accrued daily. Daily expense accruals will be reviewed
and revised, as required, to reflect actual payments
made to vendors.
e. Capital accounts for each class of shares will be updated
based on daily share activity and reconciled to transfer agent
reported outstanding shares.
- 2 -
<PAGE>
f. All balance sheet asset, liability and capital accounts
will be reconciled to subsidiary records for
completeness and accuracy.
g. For each Fund, a pricing worksheet (see attached
example) will be prepared daily which calculates the
net asset value of outstanding shares and the
percentage of net asset value of such class to the
total of all classes of shares. Investment income and
joint expenses will be allocated by class of shares
according to such percentages. Realized and unrealized
gains will be allocated by class of shares according to
such percentages.
h. Prior day net assets by class will be rolled forward to
current day net assets by class of shares by adjusting
for current day income, expense and distribution
activity. Net assets by class of shares will then be
divided by the number of outstanding shares for each
class to obtain the net asset value per share. Net
asset values will be reviewed and approved by
supervisors.
i. Net asset values per share of the different classes of shares
of the Funds may be different as a result of accumulated
income between distribution dates and the effect of class
specific expenses. Other differences, if any, will be
investigated by the accounting supervisor.
2. Control Objective
Recorded expenses of a Fund are properly allocated between each class
of shares.
METHODOLOGY, PROCEDURES AND INTERNAL ACCOUNTING CONTROLS
a. Expenses will be classified as being either joint or
class specific on the pricing worksheet.
b. Certain expenses will be attributable to more than one
Fund. Such expenses will be first allocated among the
Funds, based on the aggregate net assets of such Funds,
and then borne on such basis by each Fund and without
regard to class. These expenses could include, for
example, Trustees' fees and expenses, unallocated audit
and legal fees, insurance premiums, expenses relating
to shareholder reports and printing expenses. Expenses
that are attributable to a particular Fund but not to a
particular class thereof will be borne by each class on
the basis of the net assets of such class in relation
- 3 -
<PAGE>
to the aggregate net assets of the Fund. These expenses could
include, for example, advisory fees and custodian fees, and
fees related to the preparation of separate documents for
current shareholders of a particular Fund.
c. Class specific expenses are those identifiable with
each individual class of shares. These expenses
include 12b-1 distribution fees; transfer agent fees as
identified by Countrywide as being attributable to a
specific class; printing and postage expenses related
to preparing and distributing materials such as
shareholder reports, prospectuses and proxies to
current shareholders of a particular class; SEC and
Blue Sky registration fees; the expenses of
administrative personnel and services required to
support the shareholders of a specific class;
litigation or other legal expenses relating solely to
one class of shares; Trustees' fees incurred as a
result of issues relating to one class of shares; and
accounting fees and expenses relating to a specific
class of shares.
d. Joint expenses will be allocated daily to each class of shares
based on the percentage of the net asset value of shares of
such class to the total of the net asset value of shares of
all classes of shares. Class specific expenses will be charged
to the specific class of shares. Both joint expenses and class
specific expenses are compared against expense projections.
e. The total of joint and class specific expense limits
will be reviewed to ensure that voluntary or
contractual expense limits are not exceeded. Amounts
will be adjusted to ensure that any limits are not
exceeded. Expense waivers and reimbursements will be
calculated and allocated to each class of shares based
upon the pro rata percentage of the net assets of a
Fund as of the end of the prior day, adjusted for the
previous day's share activity.
f. The Consultant shares of each Fund will accrue
distribution expenses at a rate (but not in excess of
the applicable maximum percentage rate) which will be
reviewed by the Board of Trustees on a quarterly basis.
Such distribution expenses will be calculated at an
annual rate not to exceed .15% of the average daily net
assets of a Fund's Consultant shares. Under the
distribution plan, payments will be made only for
expenses incurred in providing distribution related
services. Unreimbursed distribution expenses of the
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<PAGE>
Advisor will be determined daily and the Advisor shall not be
entitled to reimbursement for any amount with respect to any
day on which there exist no unreimbursed distribution
expenses.
g. Expense accruals for both joint and class specific expenses
are reviewed each month. Based upon these reviews, adjustments
to expense accruals or expense projections are made as needed.
h. Expense ratios and yields for each class of shares will be
reviewed daily to ensure that differences in yield relate
solely to acceptable expense differentials.
i. Any change to the classification of expenses as joint
or class specific is reviewed and approved by the Board
of Trustees.
j. Countrywide will perform detailed expense analyses to ensure
that expenses are properly charged to each Fund and to each
class of shares. Any expense adjustments required as a result
of this process will be made.
3. Control Objective
Dividend distributions are accurately calculated for each class of
shares.
METHODOLOGY, PROCEDURES AND INTERNAL ACCOUNTING CONTROLS
a. The Funds declare substantially all net investment
income on a quarterly basis.
b. Investment income, including amortization of discount and
premium, where applicable, is recorded by each Fund and is
allocated to each class of shares based upon its pro rata
percentage of the net assets of the Fund as of the end of the
prior day, adjusted for the previous day's share activity.
c. Each Fund will determine the amount of accumulated
income available for all classes after deduction of
allocated expenses but before consideration of any
class specific expenses. This amount will be divided
by total outstanding shares for all classes combined to
arrive at a gross dividend rate for all shares. From
this gross rate, a class specific amount per share for
each class (representing the unique and incrementally
higher, if any, expenses accrued during the period to
that class divided by the shares outstanding for that
class) is subtracted. The result is the actual per
share rate available for each class in determining
amounts to distribute.
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<PAGE>
d. Realized capital gains, if any, are allocated daily to each
class based upon its relative percentage of the total net
assets of the Fund as of the end of the prior day, adjusted
for the previous day's share activity.
e. Capital gains are distributed at least once every
twelve months with respect to each class of shares.
f. The capital gains distribution rate will be determined on the
ex-date by dividing the total realized gains of the Fund to be
declared as a distribution by the total outstanding shares of
the Fund as of the record date.
g. Capital gains dividends per share should be identical
for each class of shares within a Fund. Differences,
if any, will be investigated and resolved.
h. Distributions are reviewed annually by Countrywide at fiscal
year end and as required for excise tax purposes during the
fiscal year to ensure compliance with IRS regulations and
accuracy of calculations.
There are several pervasive procedures and internal accounting controls which
impact all three of the previously mentioned objectives.
a. Countrywide's supervisory personnel will be involved on a
daily basis to ensure that the methodology and procedures for
calculating the net asset value and dividend distribution for
each class of shares is followed and a proper allocation of
expenses among each class of shares is performed.
b. Countrywide fund accountants will receive overall
supervision. Their work with regard to multiple class
calculations will be reviewed and approved by
supervisors.
c. Countrywide's pricing worksheets will be clerically
checked and verified against corresponding computer
system generated reports.
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<PAGE>
Sample Multiple Class Worksheet
Allocation Methodology - Value of Shares Outstanding
Fund ______________________________
Date ______________________________
<TABLE>
<CAPTION>
Total
(T) (A) (B) (C)
<S> <C> <C> <C> <C>
1 Prior day NAV per share (unrounded) _______ _______ _______ _______
ALLOCATION PERCENTAGES
Complete for all Funds:
2 Shares O/S - prior day _______ _______ _______ _______
3 Prior day shares activity _______ _______ _______ _______
4 Adjusted shares O/S [2 + 3] _______ _______ _______ _______
5 Adjusted net assets [4 x 1] _______ _______ _______ _______
6 % Assets by class _______ _______ _______ _______
INCOME AND EXPENSES
7 Daily income *
Expenses: _______ _______ _______ _______
8 Management Fee* _______ _______ _______ _______
9 12-1 Fee _______ _______ _______ _______
10 Other Joint Expenses* _______ _______ _______ _______
11 Direct Class Expenses _______ _______ _______ _______
12 Daily expenses [8+9+10+11] _______ _______ _______ _______
13 Daily Net Income [7 - 12] _______ _______ _______ _______
CAPITAL
14 Income distribution _______ _______ _______ _______
15 Undistributed Net Income [13 - 14] _______ _______ _______ _______
16 Capital share activity _______ _______ _______ _______
17 Realized Gains/Losses:
18 Short-Term* _______ _______ _______ _______
19 Long-Term* _______ _______ _______ _______
20 Capital gain distribution _______ _______ _______ _______
21 Unrealized appreciation/depreciation* _______ _______ _______ _______
22 Daily net asset change _______ _______ _______ _______
[15 + 16 + 18 + 19 + 20 + 21]
NAV PROOF
23 Prior day net assets _______ _______ _______ _______
24 Current day net assets [22 + 23] _______ _______ _______ _______
25 NAV per share [24 / 4] _______ _______ _______ _______
* - Allocated based on Line 6 percentages.
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</TABLE>
<PAGE>
MULTIPLE CLASS PRICING
FINANCIAL STATEMENT DISCLOSURE
STATEMENT OF ASSETS AND LIABILITIES
- Assets and liabilities will be disclosed in accordance
with standard reporting format.
- The following will be disclosed for each class:
Net Assets:
CONSULTANT SHARES
Paid-in capital
Undistributed net investment income
Undistributed realized gain (loss) on
investments - net
Unrealized appreciation (depreciation) on
investments - net
Net Assets - equivalent to $ ____ per share based
on ____ shares outstanding.
INSTITUTIONAL SHARES
Paid-in capital
Undistributed net investment income
Undistributed realized gain (loss) on
investments - net
Unrealized appreciation (depreciation) on
investments - net
Net Assets - equivalent to $ ____ per share based
on ____ shares outstanding.
STATEMENT OF OPERATIONS
- Standard reporting format, except that class specific expenses
will be disclosed for each class.
STATEMENT OF CHANGES IN NET ASSETS
- Show components by each class of shares and in total as
follows:
CURRENT YEAR
TOTAL CONSULTANT INSTITUTIONAL
PRIOR YEAR
TOTAL CONSULTANT INSTITUTIONAL
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<PAGE>
SELECTED SHARE DATA AND RATIOS
- Show components by each class as follows:
CURRENT YEAR
CONSULTANT INSTITUTIONAL
PRIOR YEARS
CONSULTANT INSTITUTIONAL
NOTES TO FINANCIAL STATEMENTS
- Note on share transactions will include information on
each class of shares for two years
- Notes will include additional disclosure regarding
allocation of expenses between classes.
- Notes will describe the distribution arrangements,
incorporating disclosure on any classes' 12b-1 fee
arrangements.
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