As filed with the Securities and Exchange Commission on March 29, 1996.
File No. 33-30975
811-5875
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 8 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 10 [X]
(Check appropriate box or boxes.)
THE CROWLEY PORTFOLIO GROUP, INC.
(Exact Name of Registrant as Specified in Charter)
1813 Marsh Road, Suite H, Wilmington, Delaware 19810
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (302) 529-1717
Robert A. Crowley, President, The Crowley Portfolio Group, Inc.,
1813 Marsh Road, Suite H, Wilmington, Delaware 19810
(Name and Address of Agent for Service)
Please send copies of all communications to:
Bruce G. Leto, Esquire
Stradley, Ronon, Stevens & Young
2600 One Commerce Square
Philadelphia, PA 19103-7098
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of the registration statement.
It is proposed that this filing will become effective (check appropriate box)
X immediately upon filing pursuant to paragraph (b).
_____ on (date) pursuant to paragraph (b).
_____ 60 days after filing pursuant to paragraph (a)(1).
_____ on (date) pursuant to paragraph (a)(1).
_____ 75 days after filing pursuant to paragraph (a)(2).
_____ on (date) pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following box:
_____ This post-effective amendment designates a new effective
date for a previously filed post-effective amendment.
Registrant has registered an indefinite number or amount of securities under the
Securities Act of 1933 pursuant to Rule 24f-2 of the Investment Company Act of
1940. Registrant filed its Rule 24f-2 Notice for Registrant's fiscal year ended
November 30, 1995 on January 26, 1996.
<PAGE>
CROSS REFERENCE SHEET
N-1A
Item No. Caption or Location.
PART A. INFORMATION REQUIRED IN A PROSPECTUS.
Item 1. Cover. Cover.
Item 2. Synopsis. Expenses of the Portfolios; Financial
Highlights.
Item 3. Condensed Financial
Information. Financial Highlights; Performance.
Item 4. General Description of
Registrant. Prospectus Cover; Financial Highlights;
Investment Objective and Policies of
Each Portfolio; Risk Factors; Investment
Restrictions.
Item 5. Management of the Fund. Board of Directors; Investment Advisor;
Distribution of Shares; Custodian,
Transfer and Dividend Disbursing Agent,
and General Operations.
Item 5A. Management Discussion. Management's Discussion of Fund
Performance.
Item 6. Capital Stock and Other
Securities. Capital Stock; Dividends, Distributions
and Taxes.
Item 7. Purchase of Securities
Being Offered. Determination of Net Asset Value; How to
Purchase Shares.
Item 8. Redemption or Repurchase. How to Redeem Shares.
Item 9. Legal Proceedings. Not Applicable.
PART B. INFORMATION REQUIRED IN A STATEMENT OF
ADDITIONAL INFORMATION
Item 10. Cover Page. Cover.
Item 11. Table of Contents. Table of Contents.
Item 12. General Information and
History. Not Applicable.
Item 13. Investment Objectives and
Policies. Cover; The Crowley Portfolio Group, Inc.
--Investments, Investment Restrictions.
Item 14. Management of the Registrant. Officers and Directors of the Fund.
II
<PAGE>
PART B. INFORMATION REQUIRED IN A STATEMENT OF
ADDITIONAL INFORMATION (Continued)
Item 15. Control Persons and Principal Ownership of Securities.
Holders of Securities.
Item 16. Investment Advisory and Other
Services. Investment Advisor.
Item 17. Brokerage Allocation. Allocation of Portfolio Brokerage.
Item 18. Capital Stock and Other
Securities. Not Applicable.
Item 19. Purchase, Redemption and
Pricing of Securities Being
Offered. Purchase of Shares.
Item 20. Tax Status. Not Applicable.
Item 21. Underwriters. Distributor.
Item 22. Calculation of Performance
Data. Performance.
Item 23. Financial Statements. Financial Statements.
PART C. OTHER INFORMATION.
Item 24. Financial Statements and Exhibits.
Item 25. Persons Controlled by or
Under Common Control.*
Item 26. Number of Holders of Securities.*
Item 27. Indemnification.*
Item 28. Business and Other Connections
of Investment Adviser.*
Item 29. Principal Underwriters.*
Item 30. Location of Accounts and Records.*
Item 31. Management Services.*
Item 32. Undertakings.*
- --------
* Item has been answered in order in Part C of the Registrant's Registration
Statement on Form N-1A.
<PAGE>
THE CROWLEY PORTFOLIO GROUP, INC.
THE DATE OF THIS PROSPECTUS IS APRIL 1, 1996
1813 Marsh Road, Suite H, Wilmington, DE 19810
(302) 529-1717
The Crowley Portfolio Group, Inc. ("Fund") is an open-end diversified
management investment company. It was organized as a series Maryland corporation
on August 15, 1989 and currently offers shares of three series, otherwise known
as portfolios, each of which has a specific investment objective. There is no
assurance that each Portfolio's objective will be achieved.
THE CROWLEY GROWTH AND INCOME PORTFOLIO (formerly, The Crowley Growth
Portfolio). The objective of the Portfolio is long-term growth of capital for
investors, with the secondary objective being current income. The Portfolio
seeks to achieve its objective by investing in the securities of companies
which, in the view of the investment advisor, have the prospects for above
average capital growth and by making other investments selected in accordance
with the Portfolio's investment policies and restrictions. (See "Investment
Objectives and Policies of Each Portfolio - The Crowley Growth and Income
Portfolio," Page 11).
THE CROWLEY INCOME PORTFOLIO. The objective of the Portfolio is to maximize
current income, consistent with prudent risk. The Portfolio seeks to achieve its
objective by investing in fixed-income securities and other debt instruments in
accordance with the Portfolio's investment policies and restrictions. (See
"Investment Objectives and Policies of Each Portfolio - The Crowley Income
Portfolio," Page 12).
THE CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO. The objective of the
Portfolio is high total return consistent with reasonable risk. The Portfolio
seeks to achieve its objective by concentrating (investing 25% or more of the
value of its assets) its investments in shares of registered investment
companies and by making other investments in accordance with the Portfolio's
investment policies and restrictions (see "Investment Objective and Policies of
Each Portfolio - The Crowley Diversified Management Portfolio," page 13). The
Portfolio, by investing in shares of registered investment companies, indirectly
pays a portion of the operating expenses, management expenses and brokerage
costs of such companies as well as the expenses of operating the Portfolio. The
Portfolio's investors indirectly may pay higher total operating expenses and
other costs than they might by owning the underlying investment companies
directly.
The shares of the Portfolios may be purchased or redeemed at any time.
Purchases will be effected at the public offering price and redemptions will be
effected at net asset value next determined following receipt of the investor's
request. (See "Determination of Net Asset Value," Page 23, "How to Purchase
Shares," Page 24, and "How to Redeem Shares," Page 25).
This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. Investors should read and
retain this Prospectus for future reference.
More information about the Fund has been filed with the Securities and
Exchange Commission, and is contained in the "Statement of Additional
Information," dated April 1, 1996, which is available at no charge upon written
request to the Fund. The Fund's Statement of Additional Information is
incorporated herein by reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
EXPENSES OF THE PORTFOLIOS
The following table illustrates all expenses and fees that a shareholder of
the Fund will incur.
Shareholder Transaction Expenses
<TABLE>
<CAPTION>
Crowley
Crowley Growth Crowley Diversified
and Income Income Management
Portfolio Portfolio Portfolio
<S> <C> <C> <C>
Maximum Sales Load Imposed on Purchases (as a percentage of None None None
offering price)
Maximum Sales Load Imposed on Reinvested Dividends (as a None None None
percentage of offering price)
Deferred Sales Load (as a percentage of original purchase None None None
price or redemptions proceeds, as applicable)
Redemption Fees None None None
Exchange Fee None None None
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fees 1.00% 0.60% 1.00%
12b-1 Fees None None None
Other Expenses 0.93% 0.83% 1.06%
Total Fund Operating Costs 1.93% 1.43% 2.06%
</TABLE>
The purpose of this table is to assist the investor in understanding the
various expenses that an investor in the Fund will bear directly or indirectly.
An investor will bear Fund expenses in proportion to the number of shares owned
by such investor. With respect to The Crowley Diversified Management Portfolio,
"Other Expenses" is based on estimated amounts for the current fiscal year.
Management and Advisory Expenses with respect to The Crowley Growth and
Income Portfolio and The Crowley Diversified Management Portfolio are higher
than those paid by most other investment companies, but are similar to the
expenses normally paid by other funds with similar investment objectives.
The following example illustrates the expenses that you would pay on a
$1,000 investment over various time periods, assuming: (1) a 5% annual rate of
return; and (2) redemption at the end of each time period. As noted in the table
above, the Fund charges no redemption fees of any kind.
2
<PAGE>
<TABLE>
<CAPTION>
Example 1 yr. 3 yrs. 5 yrs. 10 yrs.
<S> <C> <C> <C> <C>
Crowley Growth
and Income Portfolio $ 19 $ 60 $103 $224
Crowley Income Portfolio $ 15 $ 45 $ 78 $171
Crowley Diversified
Management Portfolio $ 21 $ 65 n/a n/a
</TABLE>
This example should not be considered a representation of past or future
expenses or performance. Actual expenses may be greater or lesser than those
shown.
3
<PAGE>
HIGHLIGHTS
INVESTMENT OBJECTIVE
THE CROWLEY GROWTH AND INCOME PORTFOLIO (formerly, The Crowley Growth
Portfolio). The objective of the Portfolio is long-term growth of capital, with
the secondary objective being current income. The Portfolio seeks to achieve its
objective by investing in the securities of companies which have the prospects
for above-average capital growth and by making other investments in accordance
with the Portfolio's investment policies and restrictions. (See "Investment
Objectives and Policies.")
THE CROWLEY INCOME PORTFOLIO. The objective of the Portfolio is to maximize
current income which is consistent with prudent risk. The Portfolio seeks to
achieve its objective by investing in fixed-income securities and other debt
instruments and by making other investments selected in accordance with the
Portfolio's investment policies and restrictions. (See "Investment Objectives
and Policies.")
THE CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO. The objective of the
Portfolio is high total return consistent with reasonable risk. The Portfolio
seeks to achieve its objective by concentrating (investing 25% or more of the
value of its assets) its investments in shares of registered investment
companies and by making other investments in accordance with the Portfolio's
investment policies and restrictions (see "Investment Objectives and Policies.")
INVESTMENT POLICIES
The Crowley Growth and Income Portfolio attempts to achieve its objectives
by investing primarily in common stocks, common stock equivalents and
convertible securities of companies which offer the prospect for growth of
earnings while paying current dividends. The Portfolio diversifies its
investments among different industries and companies, and changes its portfolio
securities for investment considerations and not for trading purposes. During
times when the investment advisor (Crowley & Crowley Corp.) determines that
there is a generally rising trend in the stock market, any return generated by
the Portfolio will consist primarily of net realized and unrealized appreciation
in the value of the securities it holds and, to a lesser degree, from dividends
and interest.
The Crowley Income Portfolio attempts to achieve its objectives by
investing primarily in a diversified portfolio of fixed-income securities;
however, the portfolio may invest its assets in all classes of securities,
bonds, preferred stocks and common stocks which it believes have better income
potential than fixed-income securities. The investment advisor selects the
Portfolio's diversified group of securities for their high yields relative to
risk involved. During times when the investment advisor determines that there is
a generally rising trend in fixed-income markets any return will, in general,
consist primarily of interest and, to a lesser degree, from net realized and
unrealized appreciation, and in a rising stock market the returns will consist
of dividends and net realized and unrealized gain from stocks.
The Crowley Diversified Management Portfolio attempts to achieve its
objectives by concentrating (investing 25% or more of the value of its assets)
in shares of other registered investment companies and by making other
investments in accordance with the Portfolio's investment policies
4
<PAGE>
and restrictions. To generate its return, the Portfolio uses a variety of
investment techniques in an effort to generate a high total return consisting of
the sum of interest, dividend and other income and net realized and unrealized
appreciation in the value of the Portfolio of investment companies (including
money market mutual funds), closed-end investment companies, cash equivalents
(such as repurchase agreements or certificates of deposit), cash, stocks, bonds
and other debt obligations, stock options, stock index options, stock index
futures and options thereon. These include investment companies which invest in
foreign stocks and bonds and gold and silver mining companies. To further
enhance the performance, the Advisor may invest in so-called "sector funds"
which, in general, concentrate their assets in one segment of the equity market.
The Portfolio is unable to predict what portion of its total return will consist
of income, short-term capital gains or long-term capital gains.
During times when the investment advisor determines that there is a
generally declining trend in the fixed-income and/or stock markets, greater
percentages of a Portfolio's assets will be placed in cash or cash equivalents.
For each Portfolio, such investments will emphasize protection of principal and
will de-emphasize the generation of growth (Crowley Growth and Income), high
income (Crowley Income), and high total return (Crowley Diversified Management).
Cash equivalents will consist of money market securities, which will include
marketable securities issued or guaranteed as to principal and interest by the
government of the United States or by its agencies or instrumentalities,
domestic bank certificates of deposit, bankers' acceptances, prime commercial
paper, and repurchase agreements (secured by United States Treasury or agency
obligations). Furthermore, in times of extremely volatile or abnormal market
conditions, the investment advisor may adopt a purely temporary defensive
position which would consist of having most, if not all, of the assets invested
in these instruments. This is designed to concentrate solely on preserving the
value of the assets in the Portfolios.
HOW TO INVEST
Shares of each Portfolio are distributed by Crowley Securities, the
Distributor, and selected dealers. The minimum initial investment is $5,000;
subsequent purchases must be at least $1,000. The minimum investment amount may
consist of a single investment in one Portfolio or an aggregate investment in
any combination of Portfolios. An investment by a spouse or parent may be
combined with an investment of the other spouse or children to meet the minimum
initial or subsequent investment limit. Further, an investment by a
tax-qualified plan may be combined with a personal investment to meet the
minimum initial or subsequent investment limit. (See "How to Purchase Shares.")
HOW TO REDEEM
Shares may be redeemed by the Portfolios or repurchased by the Distributor
at any time at the net asset value next determined after receipt of the request
by the Fund, which acts as its own Transfer Agent. There is no charge for
redemptions by the Portfolios or repurchases by the Distributor.
The Portfolios have the right to redeem shares in-kind, and to redeem
accounts reduced to less than the minimum investment (presently $5,000) when the
account is not brought up to the minimum after 60 days' notice to the
shareholder. If an investor purchases Fund shares in the minimum amount, then
any redemption request could subject the entire account to mandatory redemption
by the Fund. If shares are
5
<PAGE>
redeemed in-kind, the redeeming shareholder may incur brokerage costs in
converting the assets into cash. (For information regarding redemption or
repurchase of shares, see "How to Redeem Shares.")
DIVIDENDS AND DISTRIBUTIONS
The net investment income of each Portfolio, if any, is distributed by an
annual dividend. If net capital gains are realized, they will be distributed in
an annual distribution. Dividends or distributions may be received in cash or by
reinvestment in additional shares. (See "Dividends, Distributions and Taxes.")
INVESTMENT ADVISOR
Crowley & Crowley Corp. serves as the investment advisor to each Portfolio
(managing the assets of each Portfolio and allocating its portfolio
transactions) pursuant to separate management contracts providing for a monthly
fee equal to an annualized rate of 1.00% of the average daily net assets with
respect to The Crowley Growth and Income Portfolio and the Crowley Diversified
Management Portfolio, and 0.60% of average daily net assets with respect to The
Crowley Income Portfolio. The fee with respect to The Crowley Growth and Income
Portfolio and The Crowley Diversified Management Portfolio is higher than the
investment advisory fees paid by most other mutual funds. Crowley & Crowley
Corp. currently provides investment advisory services for individuals, trusts,
estates and the three Portfolios of the Fund. (See "Investment Advisor.")
RISK FACTORS AND SPECIAL CONSIDERATIONS
Prospective investors in each Portfolio should consider a number of
factors:
1. The Portfolios may engage in the following portfolio strategies: write
covered options; purchase options; and engage in transactions in stock index
options and futures and related options on such futures. (See "Futures and
Options," "Options," "Stock Index Futures," and "Risks of Transactions in Stock
Options, Stock Index Options and Options on Stock Index Futures" under "Risk
Factors.")
2. The Portfolios may invest in repurchase agreements which involve risks
of loss if a seller defaults on its obligations under the agreement. (See
"Investment Objective and Policies" for a discussion of the risks of repurchase
agreements.)
3. Redeeming shareholders may pay redemption fees or brokerage costs if
shares are redeemed in-kind.
4. The Crowley Diversified Management Portfolio concentrates (invests more
than 25% and up to 100% of the value of its assets) in the shares of registered
investment companies, is affected by their performance, and contributes to the
expenses of operating those companies (including their advisory or operating
fees). (See "Investment Objectives and Policies of Each Portfolio"). The
Portfolio has the right to invest in investment companies which impose a sales
load or sales charges. While the Portfolio will seek to minimize such charges,
they can reduce the Portfolio's investment results. (See "Risk Factors.")
6
<PAGE>
5. The Crowley Diversified Management Portfolio may invest in securities of
registered investment companies that invest in foreign securities, which
involves significant risks that shareholders should consider. (See "Risk
Factors" and the Appendix to this Prospectus.)
7
<PAGE>
FINANCIAL HIGHLIGHTS
The following financial highlights from December 6, 1989 through November 30,
1995 are derived from the financial statements of The Crowley Portfolio Group,
Inc. and have been audited by Tait, Weller & Baker, independent auditors. The
data should be read in conjunction with the financial statements, related notes,
and the report of Tait, Weller & Baker covering such financial information and
highlights, all of which are incorporated by reference into the Fund's Statement
of Additional Information. The data should be read in conjunction with the
financial statements and related notes for the fiscal year ended November 30,
1995, all of which are incorporated by reference into the Fund's Statement of
Additional Information. Further information about the Portfolio's performance is
contained in the Fund's Annual Report to Shareholders for the fiscal year ended
November 30, 1995. A copy of the Fund's Annual Report (including the report of
Tait, Weller & Baker) may be obtained from the Fund upon request at no charge.
CROWLEY GROWTH AND INCOME PORTFOLIO
<TABLE>
<CAPTION>
12/01/94 12/01/93 12/01/92 12/01/91 12/01/90 12/06/89(a)
to to to to to to
11/30/95 11/30/94 11/30/93 11/30/92 11/30/91 11/30/90
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 10.69 $ 10.45 $ 10.19 $ 9.94 $ 9.39 $ 10.00
----------- ----------- ----------- ----------- ----------- ------------
Income from Investment
Operations
Net Investment Income .32 .12 .11 .17 .33 .32
Net Gains or Losses on
Securities (both realized
& unrealized) .88 .63 .18 .32 1.06 (.61)
Total from Investment
Operations 1.20 .75 .29 .49 1.39 (.29)
Less Distributions
Dividends (from net
investment income) (.12) (.11) (.03) (.17) (.33) (.32)
Distributions (from
capital gains) (.40) (.40) (--) (.07) (.50) (--)
Return of Capital (--) (--) (--) (--) (.01) (--)
----------- ----------- ----------- ----------- ----------- ------------
Total Distributions (.52) (.51) (.03) (.24) (.84) (.32)
----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value, End of $ 11.37 $ 10.69 $ 10.45 $ 10.19 $ 9.94 $ 9.39
Period =========== =========== =========== =========== =========== ============
Total Return 11.85% 7.41% 2.85% 4.93% 14.85% (2.90%)
Ratios/Supplemental Data:
Net Assets, End of Period
(000s omitted) 6,545 5,496 4,583 4,440 3,283 1,653
Ratio of Expenses to
Average Net Assets 1.93%(b) 1.85% 1.61% 1.52% 1.89% 1.00% (b)(c)
Ratio of Net Income to
Average Net Assets 3.00%(b) 1.10% 1.00% 1.72% 3.64% 4.49% (b)(c)
Portfolio Turnover Rate 118.08% 107.37% 243.85% 178.78% 74.86% 110.61%
<FN>
(a) Effective date of the Fund's initial registration under the Securities Act
of 1933, as amended.
(b) Annualized.
(c) The ratio of operating expenses and net income before reimbursement of
expenses by the advisor were 2.00% and 3.49%, respectively.
</FN>
</TABLE>
8
<PAGE>
FINANCIAL HIGHLIGHTS
The following financial highlights from December 6, 1989 through November 30,
1995 are derived from the financial statements of The Crowley Portfolio Group,
Inc. and have been audited by Tait, Weller & Baker, independent auditors. The
data should be read in conjunction with the financial statements, related notes,
and the report of Tait, Weller & Baker covering such financial information and
highlights, all of which are incorporated by reference into the Fund's Statement
of Additional Information. The data should be read in conjunction with the
financial statements and related notes for the fiscal year ended November 30,
1995, all of which are incorporated by reference into the Fund's Statement of
Additional Information. Further information about the Portfolio's performance is
contained in the Fund's Annual Report to Shareholders for the fiscal year ended
November 30, 1995. A copy of the Fund's Annual Report (including the report of
Tait, Weller & Baker) may be obtained from the Fund upon request at no charge.
CROWLEY INCOME PORTFOLIO
<TABLE>
<CAPTION>
12/01/94 12/01/93 12/01/92 12/01/91 12/01/90 12/06/89(a)
to to to to to to
12/01/95 11/30/94 11/30/93 11/30/92 11/30/91 11/30/90
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value
Beginning of Period $ 10.69 $ 11.57 $ 10.58 $ 10.48 $ 10.19 $ 10.00
---------- ------------ ------------ ---------- ------------ ----------
Income from Investment Operations
Net Investment Income .65 .61 .65 .61 .67 .58
Net Gains or Losses on Securities
(both realized & unrealized) .37 (.76) .40 .22 .43 .23
---------- ------------ ------------ ---------- ------------ ----------
Total from Investment Operations 1.02 (.15) 1.05 .83 1.10 .81
---------- ------------ ------------ ---------- ------------ ----------
Less Distributions
Dividends (from net investment
income) (.63) (.66) (.06) (.61) (.67) (.58)
Distributions (from capital
gains) (--) (.07) (--) (.12) (.13) (.04)
Return of Capital (--) (--) (--) (--) (.01) (--)
---------- ------------ ------------ ---------- ------------ ----------
Total Distributions (.63) (.73) (.06) (.73) (.81) (.62)
---------- ------------ ------------ ---------- ------------ ----------
Net Asset Value,
End of Period $ 11.08 $ 10.69 $ 11.57 $ 10.58 $ 10.48 $ 10.19
========== ============ ============ ========== ============ ==========
Total Return 10.12% (1.43%) 9.97% 7.96% 10.88% 8.10%
Ratios/Supplemental Data:
Net Assets End of Period
(000s omitted) 8,940 6,654 5,423 4,133 2,865 1,397
Ratio of Expenses to Average Net
Assets 1.43%(b) 1.37% 1.23% 1.20% 1.09% (c) .99%(b)(c)
Ratio of Net Investment Income to
Average Net Assets 6.43%(b) 6.28% 6.27% 6.11% 6.78% (c) 7.10%(b)(c)
Portfolio Turnover Rate 31.60% 14.45% 19.17% 45.00% 79.36% 48.74%
<FN>
(a) Effective date of the Fund's initial registration under the Securities Act
of 1933, as amended.
(b) Annualized.
(c) The ratio of operating expenses and net income before reimbursement of
expenses by the advisor were 1.37% and 6.49%, respectively, for 1991 and
1.61% and 6.48%, respectively, for 1990.
</FN>
</TABLE>
9
<PAGE>
FINANCIAL HIGHLIGHTS
The following financial highlights from April 3, 1995 (commencement of
operations) through November 30, 1995 are derived from the financial statements
of The Crowley Portfolio Group, Inc. and have been audited by Tait, Weller &
Baker, independent auditors. The data should be read in conjunction with the
financial statements, related notes, and the report of Tait, Weller & Baker
covering such financial information and highlights, all of which are
incorporated by reference into the Fund's Statement of Additional Information.
Further information about the Portfolio's performance is contained in the Fund's
Annual Report to Shareholders for the fiscal year ended November 30, 1995. A
copy of the Fund's Annual Report (including the report of Tait, Weller & Baker)
may be obtained from the Fund upon request at no charge.
CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO
<TABLE>
<CAPTION>
04/03/95*
to
11/30/95
<S> <C>
Net Asset Value, Beginning of Period $ 10.00
----------
Income From Investment Operations
Net investment income ---
Net gains or losses on securities (both
realized & unrealized) .71
Total from investment operations .71
Less Distributions
Dividends (from net investment income) ---
Distributions (from capital gains) ---
Return of capital ---
Total Distributions
Net Asset Value, End of Period $ 10.71
==========
Total Return 7.10%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s) 962
Ratio of expenses to average
net assets 2.06% 1
Ratio of net investment
loss to average net assets (0.09%) 1
Portfolio Turnover Rate ---
<FN>
* The Fund commenced investment operations on April 3, 1995.
1 Annualized.
</FN>
</TABLE>
10
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES OF EACH PORTFOLIO
Set forth below are the investment objectives and policies of each
Portfolio. The investment objective of a Portfolio is a fundamental policy and
may not be changed without the approval of the holders of a majority of the
Portfolio's outstanding voting securities. There can be no assurance that a
Portfolio will achieve its objective.
THE CROWLEY GROWTH AND INCOME PORTFOLIO
The Crowley Growth and Income Portfolio was formerly named The Crowley
Growth Portfolio. On November 1, 1995, the Fund's Board of Directors voted
unanimously to change the name of the Portfolio to reflect more accurately the
investment objectives of the Portfolio. The name change of the Portfolio has
been effected under Maryland corporate law, effective March 29, 1996.
The Portfolio's objective is long-term growth of capital, with the
secondary objective being to achieve current income. The Crowley Growth and
Income Portfolio seeks to achieve its investment objectives by investing
primarily in common stocks, securities convertible into common stocks and common
stock equivalents (including rights and warrants). The Portfolio will invest
most of its assets in common stocks, although it may also invest in other types
of securities such as preferred stocks, high-grade bonds, short-term United
States Government securities, other high-quality, short-term securities such as
commercial paper, repurchase agreements, banker's acceptances, certificates of
deposit and other evidences of indebtedness. While it is the Portfolio's policy
to seek long-term investments, changes will be made whenever management believes
that such changes will strengthen the Portfolio's investments and realization of
its objectives. The Portfolio may also utilize stock index futures and options
to a limited extent, for hedging purposes, although at no time will more than 5%
of the Portfolio's assets be allocated to futures or options premiums. The
Portfolio will pursue its objective by investing a major portion of its assets
in securities of companies which offer prospects for growth of capital. The
Portfolio will consider income potential incidental to growth potential. The
Portfolio expects to include primarily securities that offer growth and
secondarily securities that combine elements of current income, dividend growth
and capital appreciation. The Portfolio may also invest up to 5% of its assets
in foreign securities, including sponsored or unsponsored American Depository
Receipts, and an additional 5% in sponsored or unsponsored American Depository
Receipts only, as more fully described in the Statement of Additional
Information.
To achieve its investment objective, Crowley & Crowley Corp., the
investment advisor (the "Advisor") will attempt to determine the prevailing
trend in the equity market. In order to assess the trend for rising or falling
securities, the Advisor will make use of the stock market moving averages, for
example, the Dow Jones Industrial Average, the Standard & Poor's 500 Average and
the NASDAQ OTC Composite. The Advisor will plot weekly statistics to assess the
various trends. The Advisor will also make use of the weekly advance-decline
statistics and new high-low statistics. When it is determined that there is a
prevailing upward trend in the equity market, more of the Portfolio will be
positioned in common stocks and common stock equivalents. During times when the
Advisor determines that there is a generally rising trend in the stock market,
the Portfolio will attempt to take advantage of this opportunity by generating
returns consisting primarily of net realized and unrealized appreciation in the
value of the securities it holds and, to a lesser degree, from dividends and
interest. The Portfolio will generally select securities based on their current
income, their prospects for dividend growth, and their prospects for capital
appreciation. Since the Portfolio seeks long-term growth of capital and
secondarily current income, its portfolio can be expected to include some
securities that offer only growth, others that offer only income potential, as
well as many securities that combine elements of both. When investing for
long-term growth of capital, the Portfolio will seek to buy equity securities of
companies with attractive earnings prospects. A portion of the portfolio may
consist of non-income producing common stocks when their potential for capital
appreciation is believed to be especially promising. The Portfolio may invest in
preferred stocks consistent with its objectives. From time to time the Portfolio
may invest a portion of its assets in cash or debt securities, when the Advisor
feels such a position is advisable in light of economic or market conditions.
When the Advisor anticipates a generally declining trend in the equity market,
the Advisor will begin to move funds into cash and cash equivalents purely as a
temporary defensive position. If the Advisor anticipates a prolonged or
significant decline, then the Portfolio may place most, if not all, of its funds
in cash or cash equivalents.
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<PAGE>
The Fund's Advisor will attempt to monitor and respond to changing economic
and market conditions and then, if necessary, reposition the Portfolio's assets,
depending on the trend analysis. Trends are analyzed by using a variety of
technical and fundamental indicators. Trends are determined by the Fund's
Advisor's judgment in light of current and past general economic and market
conditions. Among the factors which are included in the analysis are direction
of interest rates, fiscal and monetary policy, economic growth, inflation rates,
industry trends and various moving averages. When a general rising trend of the
securities market is identified, The Crowley Growth Portfolio will position
itself in common stocks and in common stock equivalents that offer prospects for
above-average capital growth.
In order to determine whether a company has above-average capital growth
prospects, the Advisor will find a mean in the growth and earnings of a
particular company over a three to five year period. The Advisor will compare
that mean to the company's actual and projected earnings to determine a
realistic estimate of future growth and earnings. The Advisor will use such
comparative figures, as well as future projections, to compare a company's
growth with the Dow Jones Industrial Average and the Standard & Poor growth
rates. Although the analysis will be done primarily for individual companies,
the Advisor may rely on similar comparative analyses performed on an industry
basis in its selection of individual securities.
THE CROWLEY INCOME PORTFOLIO
The Portfolio's objective is to maximize current income, consistent with
prudent risk, (i.e, reasonable risk to principal). The Portfolio primarily seeks
to earn and pay its shareholders current income while limiting risk to principal
through prudent investing, (i.e., achieving maximum current income with
reasonable risk to principal). The Portfolio seeks to achieve this objective by
investing in a diversified portfolio of debt securities of domestic
corporations, United States Government securities, bankers' acceptances and
certificates of deposit, repurchase agreements and convertible securities. The
Portfolio may also purchase dividend paying common stocks which it believes have
better income potential than fixed-income securities. Fixed-income securities
will include debt securities and preferred stocks, some of which may have a call
on common stock by means of a conversion privilege or attached warrants.
Investment in corporate debt securities will meet a minimum rating of Baa by
Moody's Investor Service, Inc. ("Moody's") or BBB by Standard & Poor's
Corporation ("S&P") or, if not so rated, will have been issued by a corporation
having outstanding indebtedness rated at least Baa or BBB, and
dollar-denominated obligations of foreign issuers issued in the U.S. Such
securities are considered to be "investment grade" and have been assigned one of
the four highest grades by Moody's and S&P. Only up to 5% of the Portfolio's
assets may be invested in corporate debt securities rated Baa by Moody's or BBB
by S&P, or that are of comparable quality. The remaining investments by the
Portfolio in corporate debt securities must be made in securities rated at least
A by Moody's or A by S&P, or be of comparable quality. See "Risk Factors to
Consider - Fixed-income Securities." In the event that the rating attributed to
a security which the Portfolio has purchased is reduced below Baa by Moody's or
BBB by S&P, the Portfolio, as soon as practicable, will dispose of the security
unless such disposal would be detrimental to the Portfolio in light of market
conditions.
The Portfolio's policy is to invest shorter to intermediate term when
interest rates are historically lower and longer-term when interest rates are
historically higher. The Portfolio may also utilize stock index futures and
options to a limited extent, although at no time will more than 5% of the
Portfolio's assets be allocated to futures or options premiums. The Portfolio
may also invest up to 5% of its assets in foreign securities, including
sponsored or unsponsored American Depository Receipts, and an additional 5% in
sponsored or unsponsored American Depository Receipts only, as more fully
described in the Statement of Additional Information.
In selecting corporate debt securities for the Portfolio, the Advisor
reviews and monitors the creditworthiness of each issuer and issue. Interest
rate trends and specific developments which may affect individual issuers are
also analyzed.
When the Advisor anticipates a generally declining trend in fixed-income
securities markets, the Advisor will begin to move more funds into cash and cash
equivalents. If the Advisor anticipates a prolonged or significant decline, then
the Portfolio may place most, if not all, of its funds in cash and cash
equivalents.
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<PAGE>
The Portfolio's Advisor will attempt to monitor and respond to changing
economic and market conditions and then, if necessary, reposition the
Portfolio's assets, depending on the trend analysis. Trends are analyzed by
using a variety of technical and fundamental indicators. The trends are
determined by the Fund's Advisor's judgment in light of current and past general
economic and market conditions. Among the factors which are included in the
analysis, but not limited to, are the direction of interest rates, trends in
yields, fiscal and monetary policy, economic growth, inflation rates, industry
trends and various moving averages. Fixed-income securities are more dependent
upon interest rate movements than are stocks. In The Crowley Income Portfolio,
when a general rising trend in the fixed-income market is identified, the
Portfolio will position itself in fixed-income securities. If a general rising
trend is identified in both the fixed-income market and the equity market, the
Portfolio will position itself in fixed-income securities, preferred stocks, and
high dividend paying stocks.
The range of maturities of obligations to be held by the Portfolio will
generally be short to intermediate, zero to seven years. The Portfolio intends
to invest one-third of its obligations in each segment of the zero to seven year
range (one segment being obligations maturing within zero to two years, one
segment being obligations which mature within two to four years, and one-third
being obligations maturing within four to seven years). The Portfolio retains
the right to invest in obligations with greater maturities when greater returns
are available because of higher interest rates.
THE CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO
The Portfolio's objective is high total return consistent with reasonable
risk. The Crowley Diversified Management Portfolio seeks to achieve its
investment objective by investing primarily in shares of other registered
investment companies. While it is the Portfolio's policy to invest primarily in
registered investment companies, the Portfolio may also utilize other investment
vehicles such as cash or cash equivalents (such as repurchase agreements or
certificates of deposit), closed-end investment portfolios, stocks, bonds and
other debt objectives, stock options, stock index options, stock index futures
and options thereon. At no time will more than 5% of the Portfolio's assets be
allocated to futures or option premiums. Further, the Portfolio, under normal
circumstances, will not invest in a registered investment company that has a
stated policy of investing more than 50% of its assets in derivatives, and will
not invest more than 35% of its net assets in any registered investment company
that may invest more than 35% of its net assets in bonds rated lower than Baa by
Moody's or BBB by Standard & Poor's. (See the Appendix at the end of this
Prospectus for a description of "junk bonds.")
The Portfolio will invest only in registered investment companies. If a
registered investment company in which the Portfolio invests becomes a
non-registered investment company, the Portfolio will dispose of the securities
of such non-registered investment company that it holds in its portfolio of
securities.
The Portfolio may invest in registered investment companies that are
closed-end funds. After their initial public offering, the shares of closed-end
funds frequently trade on the open market at a price per share which is less
than the net asset value per share, the difference representing the "market
discount" of such shares. Market discount may be due in part to the fact that
the shares of closed-end funds are not redeemable by the holder upon demand to
the issuer at the next determined net asset value, but rather are subject to the
principles of supply and demand in the market. A relative lack of secondary
market purchasers of closed-end fund shares also may contribute to such shares
trading at a discount to their net asset value.
Although the Portfolio intends primarily to purchase shares of closed-end
funds which trade at a market discount and which the investment manager believes
present the opportunity for capital appreciation or increased income due in part
to such market discount, there can be no assurance that the market discount on
shares of any closed-end fund will ever decrease. In fact, it is possible that
this market discount may increase or that the Portfolio may experience realized
or unrealized capital losses due to further decline in the market price of the
securities held in the portfolios of such closed-end funds, thereby adversely
affecting the net asset value of the Portfolio's shares. Similarly, there can be
no assurance that the shares of closed-end funds which trade at a premium will
continue to trade at a premium or that the premium will not decrease subsequent
to a purchase of such shares by the Portfolio. Although no assurances can be
given, the Advisor believes that its market research and analysis and the
diversification policies of the Portfolio will enable the Portfolio to avoid
significant declines in the net asset value of the Portfolio's shares due to
losses related to an individual issuer.
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<PAGE>
The Portfolio must structure its investments in other investment company
shares to comply with certain provisions of federal and state securities laws.
The Portfolio and its affiliates currently may not hold more than 3% of an
underlying fund's shares. In the event that the Portfolio holds more than 1% of
an underlying fund's shares, the underlying fund is obligated to redeem only 1%
of the underlying fund's outstanding securities during any period of less than
30 days. Consequently, any shares of an underlying fund held by the Portfolio in
excess of 1% of the underlying fund's outstanding shares will be considered
illiquid securities that, together with other such securities, may not exceed
10% of the Portfolio's net assets. When the Portfolio is more heavily
concentrated in small investment companies, it may not be able to readily
dispose of such investment company shares and may be forced to redeem Portfolio
shares in-kind to redeeming Portfolio shareholders by delivering shares of
investment companies that are held in the Portfolio. The Portfolio may be
restricted in its ability to redeem because of the 1% limitation discussed
above; however, Portfolio shareholders who redeem their shares in-kind would not
be so restricted. Applicable fundamental policies are reflected in the
Portfolio's investment restrictions.
To achieve the Portfolio's investment objective, the Advisor attempts to
determine the prevailing trend in the equity market. The strategy consists of
moving into those investments which would most benefit from the prevailing
trend. In choosing from among the available investment companies, the Advisor
considers among other things, the prior performance of the underlying investment
company, its management, its performance in both up and down markets, the
current composition of its portfolio and current investment philosophy.
The Advisor attempts to monitor and respond to changing economic and market
conditions as well as monitor the performance of the investments. If necessary,
the Advisor will reposition the Portfolio's assets to meet the changing
environment.
When the Advisor has identified a significant upward trend in a particular
industry group, the Portfolio retains the right to invest in investment
companies that concentrate in a particular industry sector. The Portfolio may
invest in these investment companies, which tend to have greater fluctuations in
value when compared to other categories of investment companies.
The Portfolio expects that it will select the investment companies in which
it will invest based, in part, upon an analysis of the past and projected
performance and investment structure of the investment companies. (See the
Appendix at the end of this Prospectus for a description of the securities that
underlying funds of the Portfolio may invest in.) However, the Portfolio must
consider other factors in the selection of the investment companies. These other
factors include the investment company's size, shareholder services, liquidity,
the investment objective and investment techniques, etc. The Portfolio may be
affected by the losses of such underlying investment companies, and the level or
risk arising from the investment practices of such investment companies (such as
repurchase agreements, quality standards, or lending of securities) and had no
control over the risk taken by such investment companies. The Portfolio can also
elect to redeem (subject to the 1% limitation discussed above) its investment in
an underlying investment company (or sell it to the company as a closed-end one)
if that action is considered necessary or appropriate.
In accordance with the Investment Company Act of 1940, if an underlying
fund submits a matter to shareholders for a vote, the Portfolio will either vote
the shares: (i) in accordance with instructions received from Portfolio
shareholders; or (ii) in the same proportion as the vote of all other holders of
such securities.
RISK FACTORS
Unless otherwise noted, the following risk factors apply to each Portfolio.
Fixed-income Securities. The Portfolios may invest only in fixed-income
securities that are investment grade, which means that they have a rating of Baa
or better as determined by Moody's or BBB or better by S&P or are of comparable
quality. These are the four highest ratings or categories as defined by Moody's
and S&P. Debt securities that are rated Baa by Moody's or BBB by S&P or, if
unrated, are of comparable quality, have speculative characteristics, and
changes in economic conditions or other circumstances are more likely to lead to
a weakened capacity to make principal and interest payments than is the case
with higher rated bonds. Only up to 5% of a
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Portfolio's assets may be invested in debt securities rated Baa by Moody's, or
BBB by S&P, or if unrated, are determined to be of comparable quality. Any
additional investments in such securities must be rated A or better by Moody's
and S&P, or be deemed to be of comparable quality. Categories below this have
lower ratings and are considered more speculative in nature. In the event that
the rating attributed to a security which a Portfolio has purchased is reduced
below Baa by Moody's or BBB by S&P, the Portfolio, as soon as practicable, will
dispose of the security unless such disposal would be detrimental to the
Portfolio in light of market conditions.
The following four categories of bonds are eligible for investment by the
Portfolios and are included in the categories of bonds classified as investment
grade by Moody's and Standard and Poor's.
<TABLE>
<CAPTION>
Moody's Standard & Poor's
No lower than -
<S> <C> <C>
Gilt-Edged Aaa AAA
High-Quality Aa AA
High-Grade A A
Investment-Grade Baa BBB
</TABLE>
The Advisor will attempt to monitor and respond to changing economic and
market conditions and if necessary reposition the portfolios' assets depending
on the trend analysis. Trends are analyzed by using a variety of technical and
fundamental indicators. Among the factors which are included in the analysis are
the direction of interest rates, economic growth, industry trends and various
moving averages.
When the Advisor identifies an upward trend, The Crowley Growth and Income
Portfolio will seek to obtain growth over income while managing risk, The
Crowley Income Portfolio will seek to obtain income while managing risk, and The
Crowley Diversified Management Portfolio will seek to obtain high total return
while managing risk. There can be no assurance that the judgment of the Advisor
as to market trends will be correct. In the event that a Portfolio were invested
substantially in common stocks during a downward market trend, because of the
volatility of stocks, it is likely that the value of an investment in the Fund
would decline more rapidly than the decline in the market as a whole.
When a downward trend has been identified protection of principal may be
emphasized over opportunities for gains in each Portfolio. When the Advisor
believes that income producing assets are more appropriate due to the economic
and market conditions an emphasis will be placed on income producing investment
vehicles. During periods of time when the Advisor believes there may be
unacceptable high risks, the portfolios may invest in cash, bank money market
accounts, or money market instruments to protect the value of the Portfolios.
The market value of the interest-bearing debt securities held by the Fund
is affected by changes in interest rates. There is normally an inverse
relationship between the market value of securities sensitive to prevailing
interest rates and actual changes in interest rates; i.e., a decline in interest
rates produces an increase in market value, while an increase in rates produces
a decrease in market value. Moreover, the longer the remaining maturity of a
security, the greater is the effect of interest rate changes on the market value
of such a security. In addition, changes in the ability of an issuer to make
payments of interest and principal and in the market's perception of an issuer's
creditworthiness also affect the market value of the debt securities of that
issuer.
Money Market Securities. Each Portfolio may invest in money market
securities, which include: marketable securities issued or guaranteed as to
principal and interest by the government of the United States or by its agencies
or instrumentalities, domestic bank certificates of deposit, bankers'
acceptances, prime commercial paper and repurchase agreements (secured by United
States Treasury or agency obligations).
Cash equivalents will consist of high-quality money market instruments
which return maximum current income and maintain preservation of capital. These
instruments are considered safe because of their short-term maturities,
liquidity and high-quality ratings.
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Commercial paper is limited to the two highest ratings of Moody's and S&P.
Firms rate borrowers differently according to their classifications. S&P's rates
companies from A for the highest quality to D for the lowest quality rating. The
A-rated companies are also subdivided into three groups depending on relative
strength. Moody's uses P-1 as their highest rating along with P-2 and P-3.
Commercial Paper may be purchased that is rated P-1 or P-2 by Moody's or A-1 or
A-2 by S&P. Instruments such as commercial paper and notes which are issued by
companies having an outstanding debt rated within these two highest ratings may
be purchased.
Bank Certificates of Deposit and Bankers' Acceptances are limited to U.S.
dollar denominated instruments of domestic banks (generally limited to
institutions with a net worth of at least $100,000,000) and of domestic branches
of foreign banks (limited to institutions having total assets of not less than
$1 billion or its equivalent).
Repurchase Agreements. Under a repurchase agreement the Portfolio acquires
a debt instrument for a relatively short period (usually not more than one week)
subject to the obligations of the seller to repurchase and of the Portfolio to
resell such instrument at a fixed price. The use of repurchase agreements
involves certain risks. For example, if the seller of the agreement defaults on
its obligation to repurchase the underlying securities at a time when the value
of these securities has declined, the Portfolio may incur a loss upon
disposition of them. If the seller of the agreement becomes insolvent and
subject to liquidation or reorganization under the Bankruptcy Code or other
laws, a bankruptcy court may determine that the underlying securities are
collateral not within the control of the Portfolio and therefore subject to sale
by the trustee in bankruptcy. Finally, it is possible that the Portfolio may not
be able to substantiate its interest in the underlying securities. While
management of the Portfolio acknowledges these risks, it is expected that they
can be controlled through stringent security selection and careful monitoring
procedures. A Portfolio may not invest more than 10% of its net assets in
repurchase agreements maturing in more than seven days. A Portfolio may enter
into repurchase agreements with banks or broker-dealers deemed to be
creditworthy by the Advisor and the Advisor will monitor the creditworthiness of
these banks or broker-dealers on an ongoing basis to ensure continued ability of
the Portfolios to engage in repurchase transactions with such institutions.
The Portfolios will select money market securities for investment when such
securities offer a current market rate of return which the Advisor considers
reasonable in relation to the risk of the investment, and the issuer can satisfy
suitable standards of creditworthiness set by the Advisor and described in the
Statement of Additional Information.
Futures And Options. Each Portfolio may seek to protect itself from
anticipated market action by using "hedging" techniques which the Fund expects
will generate gains which would offset losses on other securities owned by the
Fund. These hedging techniques could involve combinations of various techniques,
such as the purchase or sale of stocks or the use of stock options, stock index
options, stock index futures and options thereon to seek to achieve increases in
the values of such options and futures which offset decreases in the values of
other securities owned by the Fund. The Fund's Advisor would select the specific
technique(s) based upon analysis of the Fund's Portfolios, market conditions,
relative costs and risks, tax effects and other factors. There can be variations
between the relative movements of investments and the hedge selected with
respect to that investment. This may increase or decrease the gains or losses
each Fund achieves by its hedging relative to losses or gains on the hedged
investments. The following descriptions illustrate some of the techniques and
risks involved in such hedging. Further information appears in the Statement of
Additional Information, and a more detailed description of futures and options
activities is contained in the Appendix to this Prospectus.
Options. Each Portfolio intends to purchase and/or write ("sell") call and
put options that are traded on U.S. Securities Exchanges. Each Portfolio seeks
to enhance its objective by receiving premiums for writing covered call and put
options. Although each Portfolio receives premium income from these techniques,
any appreciation realized will be limited by the terms of the option. Each
Portfolio may purchase call options to protect against an increase in the price
of securities that it ultimately wants to buy. It may purchase put options to
protect its Portfolio securities against a decline in market value.
Stock Index Futures. Each Portfolio intends to purchase and sell stock
index futures contracts. A Portfolio may sell stock index futures contracts in
anticipation of, or during a market decline to attempt to offset the
16
<PAGE>
decrease in market value of its common stocks that might otherwise result; and
it may purchase such contracts in order to offset increases in the cost of
common stocks that it intends to purchase.
Options on Stock Indexes and Stock Index Futures. Each Portfolio intends to
purchase and/or write call and put options on stock indexes which are traded on
U.S. Exchanges. The Portfolios also intend to purchase and/or write call and put
options on stock index futures which are traded on U.S. Exchanges. Options on
stock index futures are similar to options on stocks or options on stock
indexes.
The selection of the foregoing techniques or any combination of them to be
used at any particular time will depend upon an assessment of the relative
implementation costs and the liquidity of the particular secondary market in
which such options, stock index futures, and options on stock indexes and stock
index futures are traded.
Risks of Transactions in Stock Options, Stock Index Options and Options on
Stock Index Futures. An option position may be closed out only on an Exchange
which provides a secondary market for an option of the same series. Although the
Portfolios will generally purchase or write only those options for which the
Advisor believes there is an active secondary market, there is no assurance that
a liquid secondary market on an Exchange will exist for any particular option.
In such event, it might not be possible to effect closing transactions in
particular options, with the result that the Portfolio would have to exercise
its options in order to realize any profit or allow the option to expire. The
inability to close-out these options may result in a loss to the Portfolio. If
exercised, the Portfolio would incur brokerage commissions upon the subsequent
disposition of underlying securities acquired. An imperfect correlation exists
between the options and securities being hedged. Success of any hedging position
depends on the ability of the investment advisor to predict a stock and interest
rate movement. The skills necessary for successful use of hedges are different
than those used in the selection of equity or fixed-income securities. The
Advisor's officer who will be responsible for hedging does not have experience
in managing portfolios which trade in such hedging instruments. If the Advisor
is incorrect in its forecasts regarding market values, interest rates, and other
applicable factors, the Portfolio utilizing these investment techniques may be
in a worse position than if the investment techniques had never been used.
While the Portfolios have not adopted fundamental limitations on their
futures or options activities, they must comply with certain requirements of the
U.S. Securities and Exchange Commission and the Commodities Futures Trading
Commission. For example, these provisions require that each Portfolio shall not
purchase or sell any futures or puts or calls on futures if immediately
thereafter the sum of the amount of the Portfolio's margin deposits (both
initial and variation deposits) and premiums paid for outstanding puts and/or
calls on futures would exceed 5% of the value of its total assets. This
limitation could, however, change if regulatory provisions applicable to the
Portfolios were to be changed. The Portfolios will not engage in transactions in
future contracts or related options for speculation but only as a hedge against
changes resulting from market conditions in the values of securities held in the
Portfolio or which a Portfolio intends to purchase. Although it is not a
fundamental policy, a Portfolio will not purchase or sell futures contracts or
purchase or sell related options if immediately thereafter more than 30% of its
net assets would be so invested. Shareholders will be notified in advance of any
change in this limitation.
By writing a call option, the Portfolio limits its opportunity to profit
from any increase in the market value of the underlying security above the
exercise price of the option. By writing a put option, the Portfolio assumes the
risk that it may be required to purchase the underlying security for an exercise
price higher than its current market value, resulting in a potential capital
loss unless the security subsequently appreciates in value.
Risks of Investing in Other Investment Companies. The Crowley Diversified
Management Portfolio, by investing in shares of investment companies, indirectly
pays a portion of the operating expenses, management expenses and brokerage
costs of such companies as well as the expense of operating the Portfolios.
Thus, the Portfolio's investors may indirectly pay higher total operating
expenses and other costs than they might pay by owning the underlying investment
companies directly. The Portfolio attempts to identify investment companies that
have demonstrated superior management in the past, thus possibly offsetting
these factors by producing better results and/or lower costs and expenses than
other investment companies. There can be no assurance that this result will be
achieved.
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<PAGE>
Further, the Portfolio may invest in investment companies which concentrate
(invest 25% or more of the value of their assets) in a particular industry.
These companies tend to have greater fluctuation in value than other investment
companies.
The Crowley Diversified Management Portfolio may invest in shares of
registered investment companies which invest in foreign securities.
Foreign Securities and Currency Considerations
The Crowley Diversified Management Portfolio may invest in shares of
registered investment companies which invest in foreign securities. Investments
in securities of foreign issuers may involve greater risks that those of U.S.
issuers. There is generally less information available to the public about
non-U.S. companies and less government regulation and supervision of non-U.S.
stock exchanges, brokers and listed companies. Non-U.S. companies are not
subject to uniform global accounting, auditing and financial reporting
standards, practices and requirements. Securities of some non-U.S. companies are
less liquid and their prices more volatile than securities of comparable U.S.
companies. Securities trading practices abroad may offer less protection to
investors. Settlement of transactions in some non-U.S. markets may be delayed or
may be less frequent than in the U.S., which could affect the liquidity of the
underlying fund's portfolio, and, in turn, the Portfolio. Additionally, in some
non-U.S. countries, there is the possibility of expropriation or confiscatory
taxation, limitations on the removal of securities, property or other assets of
the fund, political or social instability, or diplomatic developments which
could affect U.S. investments in those countries. The Portfolio intends to
invest in such registered investment companies that diversify broadly among
countries, but reserves the right to invest in investment companies that invest
a substantial portion of assets in one or more countries if economic and
business conditions warrant such investments. The Advisor will take these
factors into consideration in managing the Portfolio's investments.
The U.S. dollar market value of the underlying funds' investments and of
dividends and interest earned by the underlying funds, and in turn, the
Portfolio may be significantly affected by changes in currency exchange rates.
Some currency prices may be volatile, and there is the possibility of
governmental controls on currency exchange or governmental intervention in
currency markets, which could adversely affect the underlying funds and, in
turn, the Portfolio. Although underlying funds may attempt to manage currency
exchange rate risks, there is no assurance that the underlying funds will do so
at an appropriate time or that it will be able to predict exchange rates
accurately. For example, if any of the funds increase their exposure to a
currency and that currency's price subsequently falls, such currency management
may result in increased losses to those funds. Similarly, if any of the funds
decrease their exposure to a currency, and the currency's price rises, those
funds will lose the opportunity to participate in the currency's appreciation.
These events may adversely affect the Portfolio.
Portfolio Turnover. It is anticipated that the annualized portfolio
turnover rate for The Crowley Growth and Income Portfolio, The Crowley Income
Portfolio and The Crowley Diversified Management Portfolio generally will not
exceed 150%, 100% and 200%, respectively. The portfolio turnover rate of the
underlying funds in The Crowley Diversified Management Portfolio will affect
indirectly gains and losses, and transaction costs, of that Portfolio. High
portfolio turnover (100% or more) involves additional transaction costs (such as
brokerage commissions or sales charges) which are borne by the Portfolio, and
might involve adverse tax effects. (See "Dividends, Distributions and Taxes.")
The portfolio turnover of The Crowley Growth and Income Portfolio (formerly, The
Crowley Growth Portfolio) exceeded 150% for the fiscal year ended November 30,
1993 due to uncertainty and volatility in the equity markets and the defensive
investment posture adopted by the Advisor with the purchase of substantial
short-term debt instruments and cash equivalents.
INVESTMENT RESTRICTIONS
The investment restrictions set forth below have been adopted by the Fund
as fundamental policies for each Portfolio, to limit certain risks that may
result from investment in specific types of securities or from engaging in
certain kinds of transactions addressed by such restrictions. They may not be
changed without the affirmative vote of the holders of a majority of the
outstanding voting securities of the Portfolio. Certain of these policies are
detailed below, while other policies are set forth in the Statement of
Additional Information. Changes in values of particular
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Portfolio assets or the assets of the Portfolio as a whole will not cause a
violation of the investment restrictions so long as percentage restrictions are
observed by the Portfolio at the time it purchases any security.
Each Portfolio's investment restrictions specifically provide that the
Portfolio will not:
(a) as to 75% of the Portfolio's total assets, invest more than 5% of its
total assets in the securities of any one issuer. (This limitation does not
apply to cash and cash items, obligations issued or guaranteed by the United
States Government, its agencies or instrumentalities.)
(b) purchase more than 10% of the voting securities, or more than 10% of
any class of securities of any issuer. For purposes of this restriction, all
outstanding fixed-income securities of an issuer are considered as one class.
(c) purchase or sell commodities or commodity futures contracts, provided
that each Portfolio may enter into futures contracts and related options and
make initial and variation margin deposits in connection therewith.
(d) make loans of money or securities, except: (i) by the purchase of
fixed-income obligations in which the Portfolio may invest consistent with its
investment objective and policies; or (ii) by investment in repurchase
agreements (see "Investment Objective and Policies").
(e) invest in securities of any company if, to the knowledge of the
Portfolio, any officer or director of the Fund or the Advisor owns more than
0.5% of the outstanding securities of such company and such officers and
directors (who own more than 0.5%) in the aggregate own more than 5% of the
outstanding securities of such company.
(f) borrow money, except the Portfolio may borrow from banks: (i) for
temporary or emergency purposes in an amount not exceeding 5% of the Portfolio's
assets; or (ii) to meet redemption requests that might otherwise require the
untimely disposition of portfolio securities, in an amount up to 33 1/3% of the
value of the Portfolio's total assets (including the amount borrowed) valued at
market less liabilities (not including the amount borrowed) at the time the
borrowing was made. While borrowings exceed 5% of the value of the Portfolio's
total assets, the Portfolio will not purchase securities. Interest paid on
borrowings will reduce net income.
(g) pledge, hypothecate, mortgage or otherwise encumber its assets, except
in an amount up to 33 1/3% of the value of its net assets but only to secure
borrowings for temporary or emergency purposes, such as to effect redemptions.
(h) purchase the securities of any issuer, if, as a result, more than 10%
of the value of a Portfolio's net assets would be invested in securities that
are subject to legal or contractual restrictions on resale ("restricted
securities"), in securities for which there are no readily available market
quotations, or in repurchase agreements maturing in more than seven days, if all
such securities would constitute more than 10% of the Portfolio's net assets.
(i) for The Crowley Diversified Management Portfolio only
invest in any investment company if a purchase of its shares would
result in the Portfolio and its affiliates owning more than 3% of the
total outstanding stock of such investment company.
invest in any investment company which itself does not qualify as a
diversified investment company under the Internal Revenue Code.
CAPITAL STOCK
The authorized capital stock of The Crowley Portfolio Group, Inc. consists
of 500,000,000 shares of common stock with a par value of $0.01 each. At the
present time, 150,000,000 shares of such stock have been
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allocated to each of The Crowley Growth and Income Portfolio, The Crowley Income
Portfolio and The Crowley Diversified Management Portfolio. Each share has equal
dividend, voting, liquidation and redemption rights. There are no conversion or
preemptive rights. Shares, when issued, will be fully-paid and non-assessable.
Fractional shares have proportional voting rights. Shares of the Portfolios do
not have cumulative voting rights, which means that the holders of more than 50%
of the shares voting for the election of directors can elect all of the
directors if they choose to do so and, in such event, the holders of the
remaining shares will not be able to elect any person to the Board of Directors.
The Portfolios' shareholders will vote together to elect directors and on other
matters affecting the entire corporation, but will vote separately on matters
affecting separate series, such as changing the investment objective or
restrictions governing a Portfolio.
Shareholder inquiries should be made directly to the Distributor at (302)
529-1717.
BOARD OF DIRECTORS
The Fund's Board of Directors are fiduciaries for the Portfolios'
shareholders and are governed by the law of the State of Maryland in this
regard. They establish policy for the operation of the Portfolios, and appoint
the Officers who conduct the daily business of the Portfolios.
INVESTMENT ADVISOR
The investments of each Portfolio are managed by Crowley & Crowley Corp.
(the "Advisor"), 1813 Marsh Road, Suite H, Wilmington, DE 19810, under separate
management contracts (the "Management Contracts") which became effective on
December 6, 1989 for The Crowley Growth and Income Portfolio (formerly, The
Crowley Growth Portfolio) and The Crowley Income Portfolio and April 1, 1995 for
The Crowley Diversified Management Portfolio. The Management Contracts were
approved by shareholders of The Crowley Growth and Income Portfolio and The
Crowley Income Portfolio on November 29, 1990 and were renewed by the Board of
Directors on November 1, 1995. The Management Contract for The Crowley
Diversified Management Portfolio was approved on March 16, 1995 by the Board of
Directors, including a majority of the Board of Directors who are not parties to
the Management Contract or interested persons (as such term is defined in the
Investment Company Act of 1940, as amended) of any party to the Agreement,
voting in person at a meeting called for the purpose of voting on such approval,
and was approved by the Portfolio's initial shareholder on April 3, 1995. The
Management Contracts provide that Crowley & Crowley Corp. shall supervise and
manage each Portfolio's investments and shall determine each Portfolio's
portfolio transactions, subject to periodic review and ratification by the
Fund's Directors. The Advisor is responsible for selecting brokers and dealers
to execute transactions for the Portfolios. The Board has also authorized the
Advisor and the Fund's officers to consider sales of Portfolio shares when
allocating brokerage, subject to the policy of obtaining best price and
execution on such transactions.
Pursuant to its Management Contract with each Portfolio, the Advisor will
manage the assets of each Portfolio in accordance with the stated objective,
policies and restrictions of the Portfolio and manage the business affairs of
the Fund (subject to the supervision of the Fund's Board of Directors and the
Fund's officers). The Advisor will also provide administrative and clerical
services, keep certain books and records in connection with its services to the
Fund and supervise the services rendered to the Fund by other persons. The
Advisor has also authorized any of its directors, officers and employees who
have been elected as directors or officers of the Fund to serve in the
capacities in which they have been elected. Services furnished by the Advisor
under the contracts may be furnished through the medium of any such directors
and officers.
As compensation for its services as Advisor, the Advisor receives a fee,
computed daily and payable monthly, at the annualized rate of 1.00% of the
average monthly net assets of The Crowley Growth and Income Portfolio and The
Crowley Diversified Management Portfolio, and 0.60% of the average monthly net
assets of The Crowley Income Portfolio. The Advisor's fee with respect to The
Crowley Growth and Income Portfolio and The Crowley Diversified Management
Portfolio is higher than that paid by most other investment companies. The
Advisor pays all expenses incurred by it in rendering management services to the
Fund including the costs of accounting, bookkeeping and data
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processing services provided in its role as administrator. The Fund bears its
costs of operations. These expenses include, but are not limited to: the fee of
the Advisor, taxes, brokerage fees, fees associated with calculating the net
asset value of each Portfolio daily, legal fees, custodian and auditing fees,
and printing and other expenses which are not expressly assumed by the Advisor
under the Management Contracts. For the fiscal year ending November 30, 1995,
The Crowley Growth and Income Portfolio and The Crowley Income Portfolio
incurred expenses equal to 1.93% and 1.43%, respectively, of average net assets.
The Crowley Diversified Management Portfolio incurred expenses of 2.06% of
average net assets for the period April 3, 1995 (commencement of operations)
through November 30, 1995 of average net assets.
The Advisor has committed to the Fund to offset the management fees payable
by The Crowley Diversified Management Portfolio by the fees that Crowley
Securities, the Portfolios' Distributor and an affiliate of the Advisor,
receives in connection with the purchase and sale of investment company
securities for such Portfolio for which Crowley Securities is the dealer of
record and which have an associated sales charge, 12b-1 or shareholder servicing
fee. The Advisor will offset management fees on a monthly basis, consistent with
its receipt of such fees.
Frederick J. Crowley, Jr., Vice President of the Fund, and Robert A.
Crowley, President of the Fund, each own 50% of the voting common stock of the
Advisor. The Advisor was organized in 1986 and principally provides investment
advice to individuals. The Advisor does not provide investment advice to any
other investment companies.
Each Management Contract also identifies the right of the Advisor to the
use of the name "Crowley," and the Fund may be required to change its name if
the Advisor ceases to act as advisor to the Portfolios.
The Advisor, pursuant to the Management Contracts, also serves as the
Portfolios' administrator. The Management Contracts provide that the Advisor
will furnish each Portfolio with office facilities, with any ordinary clerical
and bookkeeping services not furnished by the custodian, or distributor and with
Portfolio accounting services. Such services include the maintenance of the
Fund's books and records of each Portfolio. The Advisor has not agreed to
perform daily pricing for the Fund. The Fund will perform that function.
The portfolio manager for each Portfolio is Mr. Robert A. Crowley, who has
been managing all the Portfolios since their inception, in 1989 for The Crowley
Growth and Income Portfolio and The Crowley Income Portfolio, and 1995 for The
Crowley Diversified Management Portfolio. Mr. Crowley, who received his
Chartered Financial Analyst certification in 1990, received his Bachelor of
Science Degree in Business Administration from the University of Delaware in
1980 and his Masters Degree in Business Administration from George Washington
University in 1985. In addition to his responsibilities in managing the
Portfolios, Mr. Crowley is a financial planner with Crowley & Crowley Corp.
Prior to managing the Portfolios, Mr. Crowley managed individual securities
accounts in addition to engaging in financial planning activities.
DISTRIBUTION OF SHARES
Crowley Securities (the "Distributor") is each Portfolio's distributor
under separate Distribution Agreements for each Portfolio dated December 6, 1989
(April 1, 1995 for The Crowley Diversified Management Portfolio), and renewed by
the Board of Directors on November 1, 1995. The Distributor promotes the
distribution of the shares of each Portfolio in accordance with each respective
agreement. Frederick J. Crowley, Jr. and Robert A. Crowley, officers of the
Advisor, are also equal general partners and registered representatives of the
Distributor, which is, therefore, an affiliated person of the Fund. The
Distributor's offices are at 1813 Marsh Road, Suite H, Wilmington, DE 19810.
All orders for the purchase of shares of a Portfolio are subject to
acceptance or rejection by the Fund in its discretion. The sale of shares will
be suspended during any period when the determination of net asset value is
suspended, and may be suspended by the Board of Directors whenever in its
judgment it is in the best interest of the Fund to do so.
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CUSTODIAN
Wilmington Trust Company, Rodney Square North, Wilmington, DE, 19890, acts
as the Custodian of the securities and cash of each Portfolio.
TRANSFER AND DIVIDEND DISBURSING AGENT
The Crowley Financial Group, Inc. ("CFG" or the "Transfer Agent") serves as
the Fund's transfer agent, dividend disbursing agent, and as redemption agent
for redemptions. CFG is under common control with the Advisor and the
Distributor and as compensation for its services, receives an asset-based fee.
GENERAL OPERATIONS
Except as indicated above, the Fund is responsible for the payment of its
expenses, including: (a) the fees payable to the Advisor, the Distributor and
the Transfer Agent; (b) the fees and expenses of directors who are not
affiliated with the Advisor or the Distributor; (c) the fees and certain
expenses of the Fund's Custodian; (d) the charges and expenses of the Fund's
legal counsel and independent accountants; (e) brokers' commissions and any
issue or transfer taxes chargeable to a Portfolio in connection with its
securities transactions; (f) all taxes and corporate fees payable by the Fund to
governmental agencies; (g) the fees of any trade association of which the Fund
is a member; (h) the cost of stock certificates, if any, representing shares of
the Portfolio; (i) reimbursements of the organization expenses of the Fund and
the fees and expenses involved in registering and maintaining registration of
the Fund and its shares with the Securities and Exchange Commission laws, and
the preparation and printing of the Fund's registration statements and
prospectuses for such purposes; (j) allocable communications expenses with
respect to investor services and all expenses of shareholders and directors
meetings and of preparing, printing and mailing prospectuses and reports to
shareholders; (k) litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of the Fund's
business; and (l) compensation for employees of the Fund.
The total expenses for The Crowley Growth and Income Portfolio and The
Crowley Income Portfolio for the fiscal year ended November 30, 1995 were 1.93%
and 1.43% of average net assets, respectively. The total expenses for The
Crowley Diversified Management Portfolio for the period April 3, 1995 to
November 30, 1995 were 2.06% of average net assets.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Portfolio will declare and pay annual dividends to its shareholders of
substantially all of its net investment income, if any, earned during the year
from its investments, and each Portfolio will distribute net realized capital
gains, if any, once with respect to each year. Expenses of the Portfolios,
including the advisory fee, are accrued each day. Reinvestments of dividends and
distributions in additional shares of a Portfolio will be made on the payment
date at the net asset value determined on the record date of the dividend or
distribution unless the shareholder has elected in writing to receive dividends
or distributions in cash. An election may be changed by notifying the Transfer
Agent in writing thirty days prior to record date.
The Crowley Portfolio Group, Inc. is a series corporation. Each Portfolio
of The Crowley Portfolio Group, Inc. is treated as a separate corporation for
federal income and excise tax purposes. Each Portfolio intends to qualify as a
regulated investment company under the Internal Revenue Code of 1986 (the
"Code"). Such qualification removes from a Portfolio any liability for Federal
income taxes upon the portion of its income distributed to shareholders and
makes Federal income tax upon such distributed income generated by each
Portfolio's investments the sole responsibility of the shareholders. Continued
qualification requires each Portfolio to distribute to its shareholders each
year substantially all of its income and capital gains. The Code imposes a
nondeductible, 4% excise tax on a regulated investment company which does not
distribute to investors in each calendar year, an amount equal to: (i) 98% of
its calendar year ordinary income; (ii) 98% of its capital gain net income (the
excess of short and long-
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term capital gain over short and long-term capital loss) for the one-year period
ending each November 30; and (iii) 100% of any undistributed ordinary or capital
gain net income from the prior year. The Fund intends to declare and pay
dividends and capital gain distributions in a manner to avoid imposition of the
excise tax. The Portfolios also intend to comply with other Code requirements
such as: (1) appropriate diversification of portfolio investments; (2)
realization of 90% of annual gross income from dividends, interest, gains from
sales of securities, or other "qualifying income;" and (3) realization of less
than 30% of gross income from gains on sale or other disposition of securities
held less than three months.
Any net capital gains recognized by a Portfolio will be distributed to its
investors without need to offset (for Federal tax purposes) such gains against
any net capital losses of another Portfolio.
Any dividend or distribution to a shareholder shortly after the purchase of
a Portfolio's shares will have the effect of reducing the net asset value per
share of such shares by the amount of the dividend or distribution. While such
payment (whether made in cash or reinvested in shares) is in effect a return of
capital, it may be subject to income taxes. Regardless of the length of time a
Portfolio's shares have been owned by shareholders who are subject to federal
income taxes, distributions from long-term capital gains are taxable as such.
The net capital gain of individuals is taxed at the same rates and in the same
manner as ordinary income, except that the maximum federal rate of tax on the
net capital gain of individuals is 28%. The net capital gain of corporations is
taxed at the same rate as ordinary corporate income.
The dividends paid by a Portfolio may qualify for the 70% dividends
received deduction for corporations. The Fund will provide an information return
to shareholders describing the Federal tax status of the dividends paid by a
Portfolio during the preceding year within 60 days after the end of each year as
required by present tax law. Individual shareholders will receive Form 1099-DIV
and Form 1099-B as required by present tax law during January of each year. If
any Portfolio makes a distribution after the close of its fiscal year which is
attributable to income or gains earned in such earlier year, then the Portfolio
shall send a notice to its shareholders describing the amount and character of
such distribution within 60 days after the close of the year in which the
distribution is made. Shareholders should consult their tax advisors concerning
the state or local taxation of such dividends, and the Federal, state and local
taxation of capital gains distributions. Corporate investors should recognize
that the investor must hold Portfolio shares for more than 45 days to qualify
any dividends (or portion thereof) for the dividends received deduction.
Dividends declared in December of any year to investors of record on any date in
December will be deemed to have been received by the investors and paid by the
series on the record date, provided such dividends are paid before February 1 of
the following year.
In accordance with law, the Fund may be required to withhold a portion of
dividends, redemptions or capital gains paid to an investor and remit such
amount to the Internal Revenue Service, if the investor fails to furnish the
Fund with a correct taxpayer identification number, if the investor fails to
supply the Fund with a tax identification number altogether, if the investor
fails to make a required certification, or if the Internal Revenue Service
notifies the Fund to withhold a portion of such distributions from an investor's
account. Certain entities, such as certain types of trusts, may be exempt from
this withholding provided they file an appropriate exemption certificate with
the Fund.
DETERMINATION OF NET ASSET VALUE
The net asset value of a Portfolio share is determined by the Fund as of
the close of regular trading on each day that the New York Stock Exchange is
open for unrestricted trading from Monday through Friday and on which there is a
purchase or redemption of a Portfolio's share. The net asset value is determined
by the Fund by dividing the value of the Portfolio's securities, plus any cash
and other assets, less all liabilities, by the number of shares outstanding.
Expenses and fees of the Portfolio, including the advisory and the distributor
fees, are accrued daily and taken into account for the purpose of determining
the net asset value.
Portfolio securities listed or traded on a securities exchange for which
representative market quotations are available, will be valued at the last
quoted sales price on the security's principal exchange on that day. Listed
securities not traded on an exchange that day, and other securities which are
traded in the over-the-counter market,
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will be valued at the last reported bid price in the market on that day, if any.
Securities for which market quotations are not readily available and all other
assets will be valued at their respective fair market value as determined in
good faith by, or under procedures established by, the Board of Directors.
Money market securities with less than sixty days remaining to maturity
when acquired by a Portfolio will be valued on an amortized cost basis by a
Portfolio, excluding unrealized gains or losses thereon from the valuation. This
is accomplished by valuing the security at cost and then assuming a constant
amortization to maturity of any premium or discount. If the Portfolio acquires a
money market security with more than sixty days remaining to its maturity, it
will be valued at current market value until the 60th day prior to maturity, and
will then be valued on an amortized cost basis based upon the value on such date
unless the Board determines during such 60 day period that this amortized cost
value does not represent fair market value.
HOW TO PURCHASE SHARES
Shares of the Fund are offered for sale to the public through its
Distributor at the public offering price thereof next computed after the receipt
of both the purchase order by the Distributor, and payment for shares purchased
by the Custodian. The public offering price is equal to the net asset value of
the shares of a Portfolio. Net asset value per share of each Portfolio is
determined as of the close of the New York Stock Exchange on each day when the
Exchange is open for business and during which there is a sufficient degree of
trading in a Portfolio's securities that the current net asset value of the
shares might be materially affected by the changes in value of such securities
but only when there has been a purchase or redemption of a Portfolio's share.
The minimum initial investment in the Fund is $5,000, and each subsequent
investment must be not less than $1,000. The minimum amount may consist of a
single investment in one Portfolio or an aggregate investment in any combination
of the Portfolios. An investment by a spouse or parent may be combined with an
investment of the other spouse or children to meet the minimum initial or
subsequent investment limit. Further, an investment by a tax-qualified plan may
be combined with a personal investment to meet the minimum initial or subsequent
investment limit.
Investments in any Portfolio may be made by completing the application form
and mailing it together with your check payable to The Crowley Portfolio Group,
Inc., to:
Crowley Securities
1813 Marsh Road
Suite H
Wilmington, Delaware 19810
Subsequent investments may be made at any time (minimum additional
investment $1,000) by mailing a check, payable to The Crowley Portfolio Group,
Inc., to the Distributor at the above address. The Distributor may be reached at
(302) 529-1717.
Investments in any Portfolio may also be made through investment dealers
which have sales agreements with Crowley Securities, the principal underwriter
of the Fund's shares. Such dealers should send the investor's Investment
Application and payment for the shares to the Fund. Payment should be made by
check. Purchase orders placed by dealers will be confirmed at the public
offering price calculated next after receipt of the properly completed
Investment Application and payment by Wilmington Trust, the Custodian. It is the
responsibility of dealers to transmit purchase orders so that they will be
received by the Custodian by 4:00 p.m. Orders received by Wilmington Trust after
4:00 p.m. will be priced at the public offering price in effect at 4:00 p.m. on
the next business day. To date, Crowley Securities has not retained any selling
dealers.
Each Portfolio reserves the right in its sole discretion: (i) to suspend
the offering of its shares; and (ii) to reject purchase orders when in the best
interest of the Portfolio.
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Your purchase will be made in full and fractional shares of the Portfolio
calculated to three decimal places. Shares are normally held in an open account
for shareholders by each Portfolio, which will send to shareholders a statement
of shares owned at the time of each transaction. Share certificates for full
shares are, of course, available at any time by written request at no additional
cost to the shareholder. No certificates will be issued for fractional shares.
HOW TO REDEEM SHARES
Shareholders may redeem all or a portion of their shares without charge on
any day on which the Portfolios calculate their net asset values (see
"Determination of Net Asset Value"). Redemptions of shares of each Portfolio of
the Fund will be effective at the net asset value per share next determined
after the receipt of a redemption request by the Transfer Agent, meeting the
requirements described below. Written redemption requests should be submitted
to: The Crowley Financial Group, Inc., 1813 Marsh Road, Suite H, Wilmington, DE
19810. Shareholders who have questions about a redemption should contact the
Transfer Agent at (302) 529-1717, although all redemption requests must be in
writing. The Portfolios normally send redemption proceeds on the next business
day, but in any event redemption proceeds are sent within seven days of receipt
of a redemption request in proper form.
A written redemption request to the Transfer Agent must: (i) identify the
Portfolio and the shareholder's account number; (ii) state the number of shares
to be redeemed; and (iii) be signed by each registered owner exactly as the
shares are registered. If the shares to be redeemed were issued in certificate
form, the certificates must be endorsed for transfer (or be accompanied by an
endorsed stock power) and must be submitted to the Transfer Agent together with
the redemption request. A redemption request for an amount in excess of $5,000,
or for any amount if for payment other than to the shareholder of record, or if
the proceeds are to be sent elsewhere than the address of record, must be
accompanied by signature guarantees. The guarantor of a signature must be a
national bank or trust company (not a savings bank), a member bank of the
Federal Reserve System or a member firm of a national securities exchange. The
Transfer Agent may require additional supporting documents for redemptions made
by corporations, executors, administrators, trustees and guardians. A redemption
request will not be deemed to be properly received until the Transfer Agent
receives all required documents in proper form. Questions with respect to the
proper form for redemption requests should be directed to the Transfer Agent at
the numbers listed on the cover of this Prospectus.
Delivery of the proceeds of a redemption of shares purchased and paid for
by check shortly before the receipt of the request may be delayed until the
Portfolio determines that its Custodian Bank has completed collection of the
purchase check which may take up to 15 days from the purchase date. The Board of
Directors may suspend the right of redemption or postpone the date of payment
during any period when: (a) trading on the New York Stock Exchange is restricted
as determined by the Securities and Exchange Commission or such Exchange is
closed for other than weekends and holidays; (b) the Securities and Exchange
Commission has by order permitted such suspension; or (c) an emergency, as
defined by rules of the Commission, exists during which time the sale of
Portfolio securities or valuation of securities held by the Portfolio are not
reasonably practicable.
Each Portfolio also reserves the right to redeem an investor's account
where the aggregate account is worth less than the minimum initial investment
required when the account is established, presently $5,000. (The minimum initial
investment may be divided between the Portfolios. Any redemption of shares from
an inactive account established with a minimum investment may reduce the account
below the minimum initial investment, and could subject the account to such
redemption). The Portfolio will advise the shareholder of such intention in
writing at least sixty (60) days prior to effecting such redemption, during
which time the shareholder may purchase additional shares in any amount
necessary to bring the account back to $5,000, and the Portfolio will not redeem
an investor's account which is worth less than $5,000 solely on account of a
market decline.
If the Board determines that it would be detrimental to the best interest
of the remaining shareholders of a Portfolio to make payment in cash, the
Portfolio may pay the redemption price in whole or in part by
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distribution in-kind of securities from the Portfolio, within certain limits
prescribed by the United States Securities and Exchange Commission. Such
securities will be valued on the basis of the procedures used to determine the
net asset value at the time of the redemption. If shares are redeemed in-kind,
the redeeming shareholder will incur brokerage costs in converting the assets
into cash.
SPECIAL PLANS
Each Portfolio also offers its shares for use in certain Tax Sheltered
(such as IRA, Keogh, 401(k) and 403(b)(7) plans) and Withdrawal Plans.
Information on these Plans is available from the Portfolios' Distributor or by
reviewing the Statement of Additional Information.
Exchange Privilege. Shareholders of a Portfolio may exchange all or part of
their shares into any other Portfolio, at net asset value, with a maximum of two
exchanges per calendar year. There is no fee for exchanges. Shares of a
Portfolio are available only in states where such shares may lawfully be sold.
The amount invested must equal or exceed the required minimum investment of the
Portfolio which is purchased. A shareholder requesting an exchange will be sent
a current prospectus and an exchange authorization form to authorize the
exchange. To exchange shares, shareholders should contact the Portfolios'
Distributor. Exchanges may not be made by telephone. The Fund retains the right
to modify the terms of its exchange privilege or to terminate the privilege.
An exchange, for tax purposes, constitutes the sale of one Portfolio and
the purchase of another. The sale may involve either a capital gain or loss to
the shareholder for federal income tax purposes.
PERFORMANCE
Total return data may from time to time be included in advertisements about
the Portfolios.
"Total return" of a Portfolio of the Fund refers to the average annual
compounded rates of return over certain periods that would equate an initial
amount invested at the beginning of a stated period from which the maximum sales
load is deducted, to the ending redeemable value of the investment. The Fund
will provide total returns for the Portfolios for one, five and ten-year
periods, as well as from inception. Non-standardized total return quotations may
also be presented for other periods, or to reflect voluntary expense limitations
in effect for the Fund in question during the relevant period, or to reflect
investment at reduced sales charge levels or net asset value. Any quotation of
total return not reflecting the maximum sales charge, or which reflects any
voluntary expense limitations, would be reduced if the maximum sales charge were
used or Fund expenses were not voluntarily limited.
The Fund may also include the yield of The Crowley Income Portfolio,
accompanied by its total return, in advertising and other written material.
Yield will be computed by dividing the net investment income per share earned
during a recent one-month period by the maximum offering price per share of the
Portfolio (reduced by any undeclared earned income expected to be paid shortly
as a dividend) on the last day of the period.
The Portfolios may also compare their investment performance to appropriate
market indexes such as the S&P Index and to appropriate mutual fund indexes;
they may advertise their ranking compared to other similar mutual funds as
reported by industry analysts such as Lipper Analytical Services, Inc.
All data will be based on a Portfolio's past investment results and does
not predict future performance. Investment performance, which will vary, is
based on many factors, including market conditions, the composition of the
investments in a Portfolio, and a Portfolio's operating expenses. Investment
performance also often reflects the risk associated with a Portfolio's
investment objective and policies. These factors should be considered when
comparing a Portfolio to other mutual funds and other investment vehicles.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
The line graphs depicted below for The Crowley Growth and Income Portfolio,
The Crowley Income Portfolio, and The Crowley Diversified Management Portfolio,
respectively, illustrate the performance of $10,000 in each Portfolio from
November 30, 1989 to November 30, 1995 (April 3, 1995 to November 30, 1995 for
The Crowley Diversified Management Portfolio), as compared to certain
broad-based indexes.
The Crowley Growth and Income Portfolio
[Line graph and total return table appear here]
The line graph illustrates the past performance of The Crowley Growth and
Income Portfolio as compared to the Lipper Growth & Income Index. The chart
illustrates that a $10,000 investment in November of 1989 would be worth
$20,793 for the Lipper Growth & Income Index and $14,891 for The Crowley
Growth and Income Portfolio through November 30, 1995. The average annual
total return chart for The Crowley Growth & Income Portfolio appears next
to the line graph. This chart illustrates that the average annual total
return for The Crowley Growth and Income Portfolio was 11.85%, 8.29% and
6.33% for the one, five and since inception time periods, respectively.
Source: LIPPER ANALYTICAL SERVICE, INC.
The Crowley Growth and Income Portfolio ("T.C.G.P.") is an investment vehicle
which seeks to achieve long term growth of capital and, secondarily, current
income. The investment vehicles for this Portfolio are common stocks and fixed
income investments. During times when the Advisor perceives that stock prices
are fully valued for investment purposes, the Advisor will increase the
percentage of fixed income investments. In the Advisor's judgement, this has
been the case for most of the existence of the Portfolio, and the Advisor has
chosen to invest in a balance of stocks, money market instruments and bonds,
both U.S. government and corporate.
During the fiscal year ended November 30, 1995, "T.C.G.P." had an annual average
total return of 11.85%. An index of funds which invest in stocks and bonds (the
"Lipper Growth & Income Index") returned 30.15% for the same period. The Advisor
cannot determine the composition of each fund within the index, but would
estimate that the average fund in the index had maintained a higher stock
exposure than that of "T.C.G.P." The historical balance of investments of
"T.C.G.P." is more reflective of the Lipper Growth & Income Index than of a
growth index, but the Portfolio also maintained a much larger cash and cash
equivalent position than funds within the Lipper Growth and Income Index.
For the five year period ended November 30, 1995, the market value of the
"T.C.G.P." would have been $14,891 and $20,793 for the Lipper Growth & Income
Index. Since inception, "T.C.G.P." produced an investment value of $14,460,
while the investment value for the Lipper Growth & Income Index would have been
$19,585. The Advisor attributes the difference in investment value to the
conservative management philosophy and the continuance of an overextended stock
market cycle. Management does not believe that investors in the "T.C.G.P." have
experienced a below market level of risk due to the greater-than- anticipated
cash positions of the Portfolio during it's initial years of operation.
27
<PAGE>
The Crowley Income Portfolio
[Line graph and total return table appear here]
The line graph illustrates the past performance of The Crowley Income
Portfolio as compared to both the Lipper Short A Index and the Lipper
Corporate A Index. The chart illustrates that a $10,000 investment in
November of 1989 would be worth $15,546 for The Crowley Income Portfolio,
$16,753 for the Lipper Corporate A Index and $15,161 for the Lipper Short A
index through November 30,1995. The average total return chart for The
Crowley Income Portfolio appears next to the line graph. This chart
illustrates that the average annual total return for The Crowley Growth
Portfolio was 10.12%, 7.39% and 7.63% for the one, five, and since
inception time periods, respectively.
Source: LIPPER ANALYTICAL SERVICE, INC.
The objective of The Crowley Income Portfolio ("T.C.I.P") is to maximize current
income, consistent with prudent risk. The Portfolio has the flexibility to
invest in several types of fixed income vehicles but the majority of its
investments must be by definition investment grade, which means in one of the
four top ratings of certain nationally recognized statistical rating
organizations. (See "Risk Factors-Fixed-income Securities"). Since inception,
"T.C.I.P." has invested almost exclusively in high quality corporate bonds,
government and government agency bonds. By investing in such bonds, the
Portfolio has been able to reduce the risk of default by any one issuer. Over
the six years of operations, the Portfolio has not held any securities that have
defaulted or missed a coupon payment.
A second area of risk management has been through the use of maturity length.
Over the past six years, the Advisor has taken a short to intermediate approach
to maturities. By selecting bonds which mature or are callable in several years,
the Advisor attempts to control the price volatility of the investments within
the Portfolio. This should add an element of downside risk protection if
interest rates were to increase.
As of the one year period ended November 30, 1995, the dollar weighted average
Portfolio maturity was 5.8 years. "T.C.I.P." had an average annual total return
of 10.12% for the period. by comparison, the Lipper Investment Grade Bond Index
(Corporate A) had an investment return of 17.56% for the same period. The Lipper
Short Investment Grade Bond Index (Short A) had an investment return of 10.04%.
Both indexes may be comparable to the Portfolio, depending on maturity and
duration during a given period.
For the five year period ended November 30, 1995, the investment value for the
Short A would have been $14,168, the Corporate A would have been 15,901, while
the "T.C.I.P." produced an investment value of $14,289. Since inception,
"T.C.I.P." produced an investment value of $15,546, while the Corporate A would
have been $16,753 and $15,161 for the Short A. Over the past six years, the
Advisor has maintained a fairly short average maturity level and in doing so has
operated more similarly to that of the Short A index, rather than that of the
Corporate A index.
28
<PAGE>
The Crowley Diversified Management Portfolio
[Line graph and total return table appear here]
The line graph illustrates the past performance for The Crowley Diversified
Management Portfolio as compared to the Lipper Growth Index. The chart
illustrates that a $10,000 investment in April of 1995 would have been
worth $10,710 for The Crowley Diversified Management Portfolio and $12,131
for the Lipper Growth Index through November 30, 1995. The average return
chart for the period inception to November 30, 1995 for The Crowley
Diversified Management Portfolio appears next to the line graph. The Fund's
average total return for the period was 7.10%.
Source: LIPPER ANALYTICAL SERVICE, INC.
The Crowley Diversified Management Portfolio ("T.C.D.M.") seeks high total
return consistent with reasonable risk. The Portfolio invests primarily in
shares of other registered investment companies. Since inception in April of
1995, "T.C.D.M." had an investment value of $10,710. There is not a readily
available index for similar portfolios, so management has chosen the Lipper
Growth Index as the broad-based index with which to compare "T.C.D.M." During
the similar time period, (April 3, 1995 to November 30, 1995), this index would
have produced an investment value of $12,131. Management intends to invest in a
broad range of investment companies and should invest in approximately thirty to
fifty different investment companies at any given time.
29
<PAGE>
APPENDIX
INVESTMENT POLICIES AND PRACTICES OF UNDERLYING FUNDS
Convertible Securities
Certain preferred stocks and debt securities that may be held by an
underlying fund have conversion features allowing the holder to convert
securities into another specified security (usually common stock) of the same
issuer at a specified conversion ratio (e.g., two shares of preferred for one
share of common stock) at some specified future date or period. The market value
of convertible securities generally includes a premium that reflects the
conversion right. That premium may be negligible or substantial. To the extent
that any preferred stock or debt security remains unconverted after the
expiration of the conversion period, the market value will fall to the extent
represented by that premium.
Foreign Investments
The Crowley Diversified Management Portfolio (the "Portfolio") may invest
in certain underlying funds which invest all or a portion of their assets in
foreign securities. Investing in securities of non-U.S. companies, which are
generally denominated in foreign currencies, and utilization of forward foreign
currency exchange contracts and other currency hedging techniques involve
certain considerations comprising both opportunity and risk not typically
associated with investing in U.S. dollar-denominated securities. Risks unique to
international investing include: (1) restrictions on foreign investment and on
repatriation of capital; (2) fluctuations in currency exchange rates; (3) costs
of converting foreign currency into U.S. dollars; (4) price volatility and less
liquidity; (5) settlement practices, including delays, which may differ from
those customary in U.S. markets; (6) exposure to political and economic risks,
including the risk of nationalization, expropriation of assets, and war; (7)
possible imposition of foreign taxes and exchange control and currency
restrictions; (8) lack of uniform accounting, auditing, and financial reporting
standards; (9) less governmental supervision of securities markets, brokers and
issuers of securities; (10) less financial information available to investors;
(11) difficulty in enforcing legal rights outside the U.S.; and (12) higher
costs, including custodial fees. These risks are often heightened for
investments in emerging or developing countries.
Foreign Currency Transactions
Foreign securities in which the underlying funds invest are subject to
currency risk, (i.e, the risk that the U.S. dollar value of these securities may
be affected favorably or unfavorably by changes in foreign currency exchange
rates and exchange control regulations.) To manage this risk and facilitate the
purchase and sale of foreign securities, these underlying funds may engage in
foreign currency transactions involving the purchase and sale of forward foreign
currency exchange contracts. Although foreign currency transactions will be used
primarily to protect the underlying funds from adverse currency movements, they
also involve the risk that anticipated currency movements will not be accurately
predicted and the underlying funds' total return could be adversely affected.
Futures Contracts
An underlying fund may enter into futures contracts for the purchase or
sale of debt securities and stock indexes. A futures contract is an agreement
between two parties to buy and sell a security or an index for a set price on a
future date. Futures contracts are traded on designated "contract markets"
which, through their clearing corporations, guarantee performance of the
contracts.
Generally, if market interest rates increase, the value of outstanding debt
securities declines (and vice versa). Entering into a futures contract for the
sale of securities has an effect similar to the actual sale of securities,
although sale of the futures contract might be accomplished more easily and
quickly. For example, if a fund holds long-term U.S. Government securities and
it anticipates a rise in long-term interest rates, it could, in lieu of
disposing of its portfolio securities, enter into futures contracts for the sale
of similar long-term securities. If rates increased and the value of the fund's
portfolio securities declined, the value of the fund's futures contracts would
increase, thereby protecting the fund by preventing the net asset value from
declining as much as it otherwise would have. Similarly, entering into futures
contracts for the purchase of securities has an effect similar to the actual
purchase of the
<PAGE>
underlying securities but permits the continued holding of securities other than
the underlying securities. For example, if the fund expects long-term interest
rates to decline, it might enter into futures contracts for the purchase of
long-term securities so that it could gain rapid market exposure that may offset
anticipated increases in the cost of securities it intends to purchase while
continuing to hold higher-yield short-term securities or waiting for the
long-term market to stabilize.
A stock index futures contract may be used to hedge an underlying fund's
portfolio with regard to market risk as distinguished from risk relating to a
specific security. A stock index futures contract does not require the physical
delivery of securities but merely provides for profits and losses resulting from
changes in the market value of the contract to be credited or debited at the
close of each trading day to the respective accounts of the parties to the
contract. On the contract's expiration date, a final cash settlement occurs.
Changes in the market value of a particular stock index futures contract reflect
changes in the specified index of equity securities on which the future is
based.
There are several risks in connection with the use of futures contracts. In
the event of an imperfect correlation between the futures contract and the
portfolio position which is intended to be protected, the desired protection may
not be obtained, and the fund may be exposed to risk of loss. Further,
unanticipated changes in interest rates or stock price movements may result in a
poorer overall performance for the fund than if it had not entered into futures
contracts on debt securities or stock indexes.
In addition, the market prices of futures contracts may be affected by
certain factors. First, all participants in the futures market are subject to
margin deposit and maintenance requirements. Rather than meeting additional
margin deposit requirements, investors may close futures contracts through
offsetting transactions which could distort the normal relationship between the
securities and futures markets. Second, from the point of view of speculators,
the deposit requirements in the futures market are less onerous than margin
requirements in the securities market. Therefore, increased participation by
speculators in the futures market may also cause temporary price distortions.
Finally, positions in futures contracts may be closed out only on an
exchange or board of trade which provides a secondary market for such futures.
There is no assurance that a liquid secondary market on an exchange or board of
trade will exist for any particular contract or at any particular time.
Options on Futures Contracts
A fund also may purchase and sell listed put and call options on futures
contracts. An option on a futures contract gives the purchaser the right, in
return for the premium paid, to assume a position in a futures contract (a long
position if the option is a call and a short position if the option is a put) at
a specified exercise price at any time during the option period. When an option
on a futures contract is exercised, delivery of the futures position is
accompanied by cash representing the difference between the current market price
of the futures contract and the exercise price of the option. The fund may
purchase put options on futures contracts in lieu of, and for the same purpose
as, a sale of a futures contract. It also may purchase such put options in order
to hedge a long position in the underlying futures contract in the same manner
as it purchases "protective puts" on securities.
As with options on securities, the holder of an option may terminate a
position by selling an option of the same series. There is no guarantee that
such closing transactions can be effected. The fund is required to deposit
initial margin and maintenance margin with respect to put and call options on
futures contracts written by it pursuant to brokers' requirements similar to
those applicable to futures contracts described above, and, in addition, net
option premiums received will be included as initial margin deposits.
In addition to the risks which apply to all options transactions, there are
several special risks relating to options on futures contracts. The ability to
establish and close out positions on such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
this market will develop. Compared to the use of futures contracts, the purchase
of options on futures contracts involves less potential risk to the fund,
because the maximum amount at risk is the premium paid for the options (plus
transaction costs). However, there may be circumstances when the use of an
option on a futures contract would result in a loss to the fund when the use of
a futures contract would not, such as when there is no movement in the prices of
the underlying securities. Writing
A-2
<PAGE>
an option on a futures contract involves risks similar to those arising in the
sale of futures contracts as described above.
Options Activities
An underlying fund may write (i.e., sell) listed call options ("calls") if
the calls are "covered" throughout the life of the option. A call is "covered"
if the fund owns the optioned securities. When a fund writes a call, it receives
a premium and gives the purchaser the right to buy the underlying security at
any time during the call period (usually not more than nine months in the case
of common stock) at a fixed exercise price regardless of market price changes
during the call period. If the call is exercised, the fund will forgo any gain
from an increase in the market price of the underlying security over the
exercise price.
A fund may purchase a call on securities only to effect a "closing purchase
transaction" which is the purchase of a call covering the same underlying
security and having the same exercise price and expiration date as a call
previously written by the fund on which it wishes to terminate its obligation.
If the fund is unable to effect a closing purchase transaction, it will not be
able to sell the underlying security until the call previously written by the
fund expires (or until the call is exercised and the fund delivers the
underlying security).
An underlying fund also may write and purchase put options ("puts"). When a
fund writes a put, it receives a premium and gives the purchaser of the put the
right to sell the underlying security to the fund at the exercise price at any
time during the option period. When a fund purchases a put, it pays a premium in
return for the right to sell the underlying security at the exercise price at
any time during the option period. An underlying fund also may purchase stock
index puts which differ from puts on individual securities in that they are
settled in cash based on the values of the securities in the underlying index
rather than by delivery of the underlying securities. Purchase of a stock index
put is designed to protect against decline in the value of the portfolio
generally rather than an individual security in the portfolio. If any put is not
exercised or sold, it will become worthless on its expiration date.
A fund's option positions may be closed out only on an exchange which
provides a secondary market for options of the same series, but there can be no
assurance that a liquid secondary market will exist at a given time for any
particular option. In this regard, trading in options on certain securities
(such as U.S. Government securities) is relatively new so that it is impossible
to predict to what extent liquid markets will develop or continue.
The underlying fund's custodian, or a securities depository acting for it,
generally acts as escrow agent for the securities on which the fund has written
puts or calls or for other securities acceptable for such escrow, so that no
margin deposit is required of the fund. Until the underlying securities are
released from escrow, they cannot be sold by the fund.
In the event of a shortage of the underlying securities deliverable on
exercise of an option, the Options Clearing Corporation has the authority to
permit other, generally comparable securities to be delivered in fulfillment of
option exercise obligations. If the Options Clearing Corporation exercises its
discretionary authority to allow such other securities to be delivered, it may
also adjust the exercise prices of the affected options by setting different
prices at which otherwise ineligible securities may be delivered. As an
alternative to permitting such substitute deliveries, the Options Clearing
Corporation may impose special exercise settlement procedures.
Hedging
An underlying fund may employ many of the investment techniques described
in this APPENDIX not only for investment purposes, but also for hedging
purposes. For example, an underlying fund may purchase or sell put and call
options on common stocks to hedge against movements in individual common stock
prices or purchase and sell stock index futures and related options to hedge
against market wide movements in common stock prices. Although such hedging
techniques generally tend to minimize the risk of loss that is hedged against,
they also may limit commensurately the potential gain that might have resulted
had the hedging transaction not occurred. Also, the desired protection generally
resulting from hedging transactions may not always be achieved.
A-3
<PAGE>
Junk Bonds
Bonds which are rated BB and below by Standard & Poor's and Ba and below by
Moody's (See "RISK FACTORS - Fixed-income Securities" for a more detailed
explanation of bond ratings) are commonly known as "junk bonds." Investing in
junk bonds involves special risks in addition to the risks associated with
investments in higher rated debt securities. Junk bonds may be regarded as
predominately speculative with respect to the issuer's continuing ability to
meet principal and interest payments.
Junk bonds may be more susceptible to real or perceived adverse economic
and competitive industry conditions than higher grade securities. The prices of
junk bonds have been found to be less sensitive to interest rate changes than
more highly rated investments but more sensitive to adverse economic downturns
or individual corporate developments. A projection of an economic downturn or of
a period of rising interest rates, for example, could cause a decline in junk
bonds prices, because the advent of a recession could lessen the ability of a
highly leveraged company to make principal and interest payments on its debt
securities. If the issuer of junk bonds defaults, a fund may incur additional
expenses to seek recovery. In the case of junk bonds structured as zero coupon
or payment-in-kind securities, the market prices of such securities are affected
to a greater extent by interest rate changes and, therefore, tend to be more
volatile than securities which pay interest periodically and in cash.
The secondary markets on which junk bonds are traded may be less liquid
than the market for higher grade securities. Less liquidity in the secondary
trading markets could adversely affect and cause large fluctuations in the daily
net asset value of a fund's shares. Adverse publicity and investor perceptions,
whether or not based on fundamental analysis, may decrease the values and
liquidity of junk bonds, especially in a thinly traded market.
There may be special tax considerations associated with investing in junk
bonds structured as zero coupon or payment-in-kind securities. A fund records
the interest on these securities as income even though it receives no cash
interest until the security's maturity or payment date. A fund will be required
to distribute all or substantially all such amounts annually and may have to
obtain the cash to do so by selling securities which otherwise would continue to
be held. Shareholders will be taxed on these distributions.
The use of credit ratings as the sole method of evaluating junk bonds can
involve certain risks. For example, credit ratings evaluate the safety of
principal and interest payments, not the market value risk of junk bonds. Also,
credit rating agencies may fail to change credit ratings in a timely fashion to
reflect events since the security was last rated.
Illiquid and Restricted Securities
An underlying fund may invest not more than 15% of its net assets in
securities for which there is no readily available market ("illiquid
securities") including securities the disposition of which would be subject to
legal restrictions (so-called "restricted securities") and repurchase agreements
having more than seven days to maturity. A considerable period of time may
elapse between an underlying fund's decision to dispose of such securities and
the time when the fund is able to dispose of them, during which time the value
of the securities (and therefore the value of the underlying fund's shares held
by the Portfolio) could decline.
Industry Concentration
An underlying fund may concentrate its investments within one industry.
Because the scope of investment alternatives within an industry is limited, the
value of the shares of such an underlying fund may be subject to greater market
fluctuation than an investment in a fund which invests in a broader range of
securities.
Leverage through Borrowing
An underlying fund may borrow up to 33 1/3% of the value of its net assets
on an unsecured basis from banks to increase its holdings of portfolio
securities. Under the 1940 Act, a fund is required to maintain continuous asset
coverage of 300% with respect to such borrowings and to sell (within three days)
sufficient portfolio holdings to
A-4
<PAGE>
restore such coverage if it should decline to less than 300% due to market
fluctuations or otherwise, even if disadvantageous from an investment
standpoint. Leveraging will exaggerate the effect of any increase or decrease in
the value of portfolio securities on a fund's net asset value, and money
borrowed will be subject to interest costs (which may include commitment fees
and/or the cost of maintaining minimum average balances) which may or may not
exceed the interest and option premiums received from the securities purchased
with borrowed funds.
Loans of Portfolio Securities
An underlying fund may lend its portfolio securities provided that: (1) the
loan is secured continuously by collateral consisting of U.S. Government
securities or cash or cash equivalents maintained on a daily mark-to-market
basis in an amount at least equal to the current market value of the securities
loaned; (2) the fund may at any time call the loan and obtain the return of the
securities loaned; (3) the fund will receive any interest or dividends paid on
the loaned securities; and (4) the aggregate market value of securities loaned
will not at any time exceed one-third of the total assets of the fund. Loans of
securities involve a risk that the borrower may fail to return the securities or
may fail to provide additional collateral.
Master Demand Notes
Although the Portfolio itself will not do so, underlying funds
(particularly money market mutual funds) may invest up to 100% of their assets
in master demand notes. Master demand notes are unsecured obligations of U.S.
corporations redeemable upon notice that permit investment by a fund of
fluctuating amounts at varying rates of interest pursuant to direct arrangements
between the fund and the issuing corporation. Because they are direct
arrangements between the fund and the issuing corporation, there is no secondary
market for the notes. However, they are redeemable at face value plus accrued
interest at any time.
Repurchase Agreements
Underlying funds, particularly money market funds, may enter into
repurchase agreements with banks and broker-dealers under which they acquire
securities subject to an agreement with the seller to repurchase the securities
at an agreed upon time and price. These agreements are considered under the 1940
Act to be loans by the purchaser collateralized by the underlying securities. If
the seller should default on its obligation to repurchase the securities, the
underlying fund may experience delay or difficulties in exercising its rights to
realize upon the securities held as collateral and might incur a loss if the
value of the securities should decline.
Short Sales
An underlying fund may sell securities short. In a short sale, a fund sells
stock which it does not own, making delivery with securities "borrowed" from a
broker. The fund is then obligated to replace the security borrowed by
purchasing it at the market price at the time of replacement. This price may not
be less than the price at which the security was sold by the fund. Until the
security is replaced, the fund is required to pay to the lender any dividends or
interest which accrue during the period of the loan. In order to borrow the
security, the fund may also have to pay a premium which would increase the cost
of the security sold. The proceeds of the short sale will be retained by the
broker to the extent necessary to meet margin requirements until the short
position is closed out.
The fund also must deposit in a segregated account an amount of cash or
U.S. Government securities equal to the difference between: (a) the market value
of the securities sold short at the time they were sold short; and (b) the value
of the collateral deposited with the broker in connection with the short sale
(not including the proceeds from the short sale). While the short position is
open, the fund must maintain daily the segregated account at such a level that:
(1) the amount deposited in it plus the amount deposited with the broker as
collateral equals the current market value of the securities sold short; and (2)
the amount deposited in it plus the amount deposited with the broker as
collateral is not less than the market value of the securities at the time they
were sold short. Depending upon market conditions, up to 80% of the value of a
fund's net assets may be deposited as collateral for the obligation to replace
securities borrowed to effect short sales and allocated to a segregated account
in connection with short sales.
A-5
<PAGE>
The fund will incur a loss as a result of the short sale if the price of
the security increases between the date of the short sale and the date on which
the fund replaces the borrowed security. The fund will realize a gain if the
security declines in price between those dates. The amount of any gain will be
decreased and the amount of any loss increased by the amount of any premium,
dividends, or interest the fund may be required to pay in connection with a
short sale.
A short sale is "against the box" if at all times when the short position
is open the fund owns an equal amount of the securities or securities
convertible into, or exchangeable without further consideration for, securities
of the same issue as the securities sold short. Such a transaction serves to
defer a gain or loss for federal income tax purposes.
Warrants
An underlying fund may invest in warrants, which are options to purchase
equity securities at specific prices valid for a specific period of time. The
prices do not necessarily move parallel to the prices of the underlying
securities. Warrants have no voting rights, receive no dividends, and have no
rights with respect to the assets of the issuer. If a warrant is not exercised
within the specified time period, it will become worthless and the fund will
lose the purchase price and the right to purchase the underlying security.
A-6
<PAGE>
INVESTMENT ADVISOR
Crowley & Crowley Corp.
1813 Marsh Road
Suite H
Wilmington, DE 19810
DISTRIBUTOR
Crowley Securities
1813 Marsh Road
Suite H
Wilmington, DE 19810
TRANSFER AGENT
The Crowley Financial Group, Inc.
1813 Marsh Road
Suite H
Wilmington, DE 19810
CUSTODIAN
Wilmington Trust Company
Rodney Square North
Wilmington, DE 19890
LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103-7098
AUDITORS
Tait, Weller & Baker
Two Penn Center
Suite 700
Philadelphia, PA 19102-1707
<PAGE>
The Crowley Portfolio Group, Inc.
Prospectus
April 1, 1996
Contents Page
Expenses of the Portfolios ................................................2
Highlights ................................................................4
Financial Highlights ......................................................8
Investment Objectives and Policies
of Each Portfolio .....................................................11
Risk Factors .............................................................14
Investment Restrictions ..................................................18
Capital Stock ............................................................19
Board of Directors .......................................................20
Investment Advisor .......................................................20
Distribution of Shares ...................................................21
Custodian ................................................................22
Transfer and Dividend Disbursing Agent ...................................22
General Operations .......................................................22
Dividends, Distributions and Taxes .......................................22
Determination of Net Asset Value .........................................23
How to Purchase Shares ...................................................24
How to Redeem Shares .....................................................25
Special Plans ............................................................26
Performance ..............................................................26
Management's Discussion of Fund Performance ..............................27
Appendix ................................................................A-1
<PAGE>
THE CROWLEY PORTFOLIO GROUP, INC.
STATEMENT OF ADDITIONAL INFORMATION DATED APRIL 1, 1996
1813 Marsh Road, Suite H, Wilmington, DE 19810
The Distributor may be telephoned at (302) 529-1717
A copy of the Prospectus of The Crowley Portfolio Group, Inc. (the "Fund")
is available without charge upon written request to the Fund.
The Fund is an open-end diversified investment company currently offering
three series of shares: The Crowley Growth and Income Portfolio (formerly, The
Crowley Growth Portfolio; see "Investment Objectives and Policies of Each
Portfolio - The Crowley Growth and Income Portfolio" in the Fund's prospectus),
The Crowley Income Portfolio, and The Crowley Diversified Management Portfolio
(each, a "Portfolio"). The shares of each Portfolio may be purchased or redeemed
at any time. Purchases will be effected at the public offering price and
redemptions will be effected at net asset value next computed after the receipt
of the investor's request.
The objective of The Crowley Growth and Income Portfolio is long-term
growth of capital for investors, with the secondary objective being current
income. The objective of The Crowley Income Portfolio is to maximize current
income, consistent with prudent risk (i.e. reasonable risk to principal). The
objective of The Crowley Diversified Management Portfolio is high total return
consistent with reasonable risk. The Portfolios will use a variety of investment
strategies in an effort to balance portfolio risks and to hedge market risks.
There can be no assurance that the objectives of the Portfolios will be
achieved.
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
IN CONNECTION WITH THE FUND'S PROSPECTUS DATED APRIL 1, 1996. RETAIN THIS
STATEMENT OF ADDITIONAL INFORMATION FOR FUTURE REFERENCE.
<PAGE>
TABLE OF CONTENTS
Page
INVESTMENT OBJECTIVES AND POLICIES...........................................2
Money Market Securities.............................................2
Foreign Investments.................................................3
Investment Company Securities.......................................3
Portfolio Turnover..................................................5
INVESTMENT RESTRICTIONS......................................................5
INVESTMENT ADVISOR...........................................................6
DISTRIBUTOR..................................................................7
ALLOCATION OF PORTFOLIO BROKERAGE............................................7
TRANSFER AGENCY FUNCTION.....................................................8
PURCHASE OF SHARES...........................................................8
Tax-Sheltered Retirement Plans......................................8
OFFICERS AND DIRECTORS OF THE FUND...........................................9
OWNERSHIP OF SECURITIES.....................................................12
GENERAL INFORMATION.........................................................12
Audits and Reports.................................................12
Custodian .........................................................12
PERFORMANCE.................................................................12
Comparisons and Advertisements.....................................14
FINANCIAL STATEMENTS........................................................15
-1-
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES
Each Portfolio seeks to achieve its objective by making investments
selected in accordance with the Portfolio's investment restrictions and
policies. Each Portfolio will vary its investment strategy to achieve its
objective, as described in the Portfolio's prospectus. This Statement of
Additional Information contains further information concerning the techniques
and operations of each Portfolio, the securities in which it will invest, and
the policies it will follow.
Money Market Securities
Although The Crowley Growth and Income Portfolio (formerly, The Crowley
Growth Portfolio) intends to invest in common stocks and common stock
equivalents, The Crowley Income Portfolio will primarily invest in debt
securities, dividend-paying stocks and preferred stocks; The Crowley Diversified
Management Portfolio concentrates its investments in shares of registered
investment companies. Each Portfolio may invest its assets directly in money
market securities whenever deemed appropriate by the advisor to achieve the
Portfolio's investment objective. It may invest, without limitation, in such
securities for temporary defensive purposes.
Securities issued or guaranteed as to principal and interest by the United
States government ("Government Securities") include a variety of Treasury
securities, which differ in their interest rates, maturities and dates of issue.
Treasury bills have a maturity of one year or less; Treasury notes have
maturities of one to ten years; Treasury bonds generally have a maturity of
greater than five years. The Portfolios will only acquire Government Securities
which are supported by the "full faith and credit" of the United States.
Securities which are backed by the full faith and credit of the United States
include Treasury bills, Treasury notes, Treasury bonds, and obligations of the
Government National Mortgage Association, the Farmers Home Administration, and
the Export- Import Bank. The Portfolios' direct investments in money market
securities will generally favor securities with shorter maturities (maturities
of less than 60 days) which are less affected by price fluctuations than those
with longer maturities.
Certificates of deposit are certificates issued against funds deposited in
a commercial bank or a savings and loan association for a definite period of
time and earning a specified return. Bankers' acceptances are negotiable drafts
or bills of exchange, normally drawn by an importer or exporter to pay for
specific merchandise, which are "accepted" by a bank, meaning, in effect, that
the bank unconditionally agrees to pay the face value of the instrument on
maturity. Investments in bank certificates of deposit and bankers' acceptances
are generally limited to domestic banks and savings and loan associations that
are members of the Federal Deposit Insurance Corporation or Federal Savings and
Loan Insurance Corporation having a net worth of at least one hundred million
dollars ("Domestic Banks") and domestic branches of foreign banks (limited to
institutions having total assets not less than $1 billion or its equivalent).
Investments in prime commercial paper may be made in notes, drafts, or
similar instruments payable on demand or having a maturity at the time of
issuance not exceeding nine months, exclusive of days of grace, or any renewal
thereof payable on demand or having a maturity likewise limited.
-2-
<PAGE>
Under a repurchase agreement the Portfolio acquires a debt instrument for a
relatively short period (usually not more than one week) subject to the
obligation of the seller to repurchase and the Portfolio to resell such debt
instrument at a fixed price. The Portfolio will enter into repurchase agreements
only with banks which are members of the Federal Reserve System, or securities
dealers who are members of a national securities exchange or are market-makers
in government securities and report to the Market Reports Division of the
Federal Reserve Bank of New York and, in either case, only where the debt
instrument collateralizing the repurchase agreement is a U.S. Treasury or agency
obligation supported by the full faith and credit of the U.S. A repurchase
agreement may also be viewed as the loan of money by the Portfolio to the
seller. The resale price specified is normally in excess of the purchase price,
reflecting an agreed upon interest rate. The rate is effective for the period of
time the Portfolio is invested in the agreement and may not be related to the
coupon rate on the underlying security. The term of these repurchase agreements
will usually be short (from overnight to one week) and at no time will a
Portfolio invest in repurchase agreements of more than sixty days. The
securities which are collateral for the repurchase agreements, however, may have
maturity dates in excess of sixty days from the effective date of the repurchase
agreement. A Portfolio will always receive, as collateral, securities whose
market value, including accrued interest, will be at least equal to 102% of the
dollar amount to be paid to the Portfolio under each agreement at its maturity,
and the Portfolio will make payment for such securities only upon physical
delivery or evidence of book entry transfer to the account of the Custodian. If
the seller defaults, the Portfolio might incur a loss if the value of the
collateral securing the repurchase agreement declines, and might incur
disposition costs in connection with liquidation of the collateral. In addition,
if bankruptcy proceedings are commenced with respect to the seller of the
security, collection of the collateral by the Portfolio may be delayed or
limited. A Portfolio may not enter into a repurchase agreement with more than
seven days to maturity if, as a result, more than 10% of the market value of the
Portfolio's net assets would be invested in such repurchase agreements together
with any other illiquid assets.
Foreign Investments
The Portfolios have the authority to invest up to 5% of their respective
assets in foreign securities, including sponsored or unsponsored American
Depository Receipts ("ADRs") for securities of foreign issuers, and the
authority to invest an additional 5% of their respective assets in sponsored or
unsponsored American Depository Receipts only. ADRs are receipts typically
issued by a U.S. bank or trust company evidencing ownership of underlying
foreign securities. These securities are not denominated in the same currency as
their underlying securities, but rather in U.S. dollars. The issuers of
unsponsored ADRs are not obligated to disclose material information in the
United States and therefore there may not be a correlation between such
information and the market value of unsponsored ADRs. Investment in foreign
issuers, directly or through ADRs, involves certain risks which are in addition
to the usual risks inherent in domestic investments. Such risks include the fact
that there may be less publicly available information about foreign companies,
and such companies are generally not subject to uniform accounting, auditing and
financial reporting standards.
Investment Company Securities
Each investment company in which The Crowley Diversified Management
Portfolio invests will be a registered investment company, and will operate
subject to a variety of regulatory constraints. While such regulation does not
guarantee the investment success of an investment
-3-
<PAGE>
company, or assure that it will not suffer investment losses, the Advisor
believes that such investment companies provide a sound foundation upon which to
base an investment portfolio. By investing in a broad spectrum of such companies
the Portfolio hopes to benefit from the collective research and analysis of many
experienced investment personnel.
There are many types of investment companies. All maintain portfolios which
are generally liquid, but can be composed of different kinds of securities and
involve different objectives. Such companies may seek only income, only
appreciation, or various combinations of these. They may invest in money market
securities, short or long-term bonds, dividend producing stocks, tax-exempt
municipal securities, or a variety of other instruments. They may seek
speculative or conservative investments ranging from securities issued by new
companies to securities issued by "blue-chip" companies. An investment company
which has a policy of holding 80% of its assets in debt securities maturing in
thirteen months or less, or which holds itself out as a "money market fund,"
will be treated as a money market fund by the Portfolio.
The Portfolio's investment advisor will be responsible for monitoring and
evaluating these kinds of factors to select investment company fund securities
for the Portfolio in accordance with the policies and techniques described in
the prospectus.
The Portfolio, by investing in shares of investment companies, indirectly
pay a portion of the operating expenses, management expenses and brokerage costs
of such companies as well as the expense of operating the Portfolio. Thus, the
Portfolio's investors will indirectly pay higher total operating expenses and
other costs than they would pay by owning the underlying investment companies
directly. The Portfolio attempts to identify investment companies that have
demonstrated superior management in the past, thus possibly offsetting these
factors by producing better results and/or lower costs and expenses than other
investment companies. There can be no assurance that this result will be
achieved.
Investment decisions by the investment advisors of the underlying funds are
made independently of the Portfolio and its Advisor. Therefore, the investment
advisor of one underlying fund may be purchasing shares of the same issuer whose
shares are being sold by the investment advisor of another such fund. The result
of this would be an indirect expense to the Portfolio without accomplishing any
investment purpose.
The Portfolio expects that it will select the investment companies in which
it will invest based, in part, upon an analysis of the past and projected
performance and investment structure of the investment companies. However, the
Portfolio must consider other factors in the selection of investment companies.
These other factors include the investment company's size, shareholder services,
liquidity, investment objective and investment techniques, etc. The Portfolio
will be affected by the losses of its underlying investment companies, and the
level of risk arising from the investment practices of such investment companies
(such as repurchase agreements, quality standards, or lending of securities) and
has no control over the risks taken by such investment companies. The Portfolio
can also elect to redeem (subject to the 1% limitation discussed in the
Portfolio's prospectus) its investment in an underlying investment company (or
sell it if the company is a closed-end one) if that action is considered
necessary or appropriate.
-4-
<PAGE>
Portfolio Turnover
It is not the policy of the Portfolios to purchase or sell securities for
short-term trading purposes, but each Portfolio of the Fund may sell securities
to recognize gains or avoid potential for loss. A Portfolio of the Fund will,
however, sell any portfolio security (without regard to the time it has been
held) when the investment advisor believes that market conditions,
credit-worthiness factors or general economic conditions warrant such a step.
The Fund presently estimates that the annualized portfolio turnover rates for
The Crowley Growth and Income Portfolio, The Crowley Income Portfolio, and The
Crowley Diversified Management Portfolio generally will not exceed 150%, 100%
and 200%, respectively. High portfolio turnover (100% or more) will involve
additional transaction costs (such as brokerage commissions or sales charges or
adverse tax effects) which are borne by the respective Portfolio. (See
"Dividends, Distributions and Taxes" in the prospectus.) During the fiscal years
ending November 30, 1995 and 1994, the portfolio turnover rates for The Crowley
Growth and Income Portfolio were 118.08% and 107.37%, respectively, and for The
Crowley Income Portfolio were 31.60% and 14.45%, respectively. The portfolio
turnover rate for The Crowley Growth and Income Portfolio for the fiscal year
ending November 30, 1993 resulted from the uncertainty and volatility apparent
in the equity markets through that year and the defensive investment posture
adopted by the Advisor with the purchase of substantial short-term debt
instruments and cash equivalents.
INVESTMENT RESTRICTIONS
In addition to those set forth in the Fund's current Prospectus, the Fund
has adopted the Investment Restrictions set forth below for each Portfolio,
which are fundamental policies and cannot be changed without the approval of a
majority of the outstanding voting securities of each Portfolio. As provided in
the Investment Company Act of 1940, a "vote of a majority of the outstanding
voting securities" of each Portfolio means the affirmative vote of the lesser
of: (i) more than 50% of the outstanding shares of the Portfolio; or (ii) 67% or
more of the shares present at a meeting if more than 50% of the outstanding
shares are represented at the meeting in person or by proxy. These investment
restrictions provide that each Portfolio will not:
(1) issue senior securities;
(2) engage in the underwriting of securities except insofar as the
Portfolio may be deemed an underwriter under the Securities Act of 1933 in
disposing of a portfolio security;
(3) purchase or sell real estate or interests therein, although it may
purchase securities of issuers which engage in real estate operations and
securities which are secured by real estate or interests therein;
(4) invest for the purpose of exercising control or management of another
company;
(5) purchase oil, gas or other mineral leases, rights or royalty contracts
or exploration or development programs, except that the Portfolio may invest in
the securities of companies which invest in or sponsor such programs;
-5-
<PAGE>
(6) concentrate (invest 25% or more of the value of its assets) its
investments in any industry (this restriction does not apply to The Crowley
Diversified Management Portfolio with respect to registered investment
companies);
(7) make purchases of securities on "margin", or make short sales of
securities, provided that each Portfolio may enter into futures contracts and
related options and make initial and variation margin deposits in connection
therewith.
With the exception of investment restriction (f) in the Fund's Prospectus
relating to borrowing, so long as percentage restrictions are observed by each
Portfolio at the time it purchases any security, changes in values of particular
Portfolio assets or the assets of the Portfolio as a whole will not cause a
violation of any of the foregoing restrictions.
INVESTMENT ADVISOR
The Management Contract for The Crowley Growth and Income Portfolio
(formerly, The Crowley Growth Portfolio) and The Crowley Income Portfolio became
effective on December 6, 1989 for an initial term of two years. Shareholders of
the Fund approved those Management Contracts on November 29, 1990 and the Board
of Directors renewed the contracts on November 1, 1995. The Management Contract
for The Crowley Diversified Management Portfolio became effective on April 1,
1995. That Agreement was approved on March 16, 1995 by the Fund's Board of
Directors, including a majority of the Directors who are not parties to the
Agreement or interested persons (as such term is defined in the Investment
Company Act of 1940, as amended) of any party to the Agreement, voting in person
at a meeting called for the purpose of voting on such approval. The Agreements
for The Crowley Growth and Income Portfolio and The Crowley Income Portfolio
will continue in effect until December 6, 1996, and the Agreement for The
Crowley Diversified Management Portfolio will continue in effect until April 1,
1997. Each Agreement will continue in effect from year-to-year thereafter only
if such continuance is approved annually by either (i) the Fund's Board of
Directors; or (2) by a vote of a majority of the outstanding voting securities
of the respective Portfolio of the Fund and, in either case, by the vote of a
majority of the directors who are not parties to the Agreement or interested
persons (as such term is defined in the Investment Company Act of 1940, as
amended) of any party to the Agreement, voting in-person at a meeting called for
the purpose of voting on such approval. The Agreements may be terminated at any
time without penalty by: (i) the Fund's Board of Directors; or (ii) by a
majority vote of the outstanding shares of the Fund, or by the Investment
Advisor, in each instance on not less than 60 days' written notice and shall
automatically terminate in the event of its assignment.
The management fees for each Portfolio are paid monthly at the annual rate
of 1.00%, 0.60% and 1.00% of the average daily net assets of The Crowley Growth
and Income Portfolio, The Crowley Income Portfolio and The Crowley Diversified
Management Portfolio, respectively.
For the fiscal years ended November 30, 1993, 1994 and 1995, the adviser
received fees of $46,869, $50,097 and $60,261 respectively, for The Crowley
Growth and Income Portfolio and $28,782, $35,724 and $46,815 respectively, for
The Crowley Income Portfolio. With regard to
-6-
<PAGE>
The Crowley Diversified Management Portfolio, for the period from April 3, 1995
(commencement of operations) to November 30, 1995, the adviser received fees of
$4,534.
The officers and directors of The Crowley Portfolio Group, Inc. and their
positions held with the Fund are as follows: Robert A. Crowley, President and
Treasurer; Frederick J. Crowley, Jr., Vice President and Secretary; Catherine C.
Crowley, Assistant Secretary and Assistant Treasurer.
DISTRIBUTOR
Pursuant to the Fund's Distribution Agreement, the expenses of printing all
sales literature, including prospectuses used as sales material, are to be borne
by the Distributor. The Distribution Agreement for each Portfolio provides that
it will continue in effect from year-to-year only so long as such continuance is
specifically approved at least annually by either the Fund's Board of Directors
or by a vote of a majority of the outstanding voting securities of the
respective Portfolio of the Fund and, in either case, by the vote of a majority
of the Fund's disinterested directors, voting in-person at a meeting called for
the purpose of voting on such approval. The Agreement will terminate
automatically in the event of its assignment. Under the Distribution Agreement,
the Distributor is the exclusive agent for the Portfolio's shares, and has the
right to select selling dealers to offer the shares to investors.
Effective August 1, 1994, the 2% sales load on the sale of Portfolio shares
was eliminated. For the fiscal years ending November 30, 1993 and 1994, the
Distributor received $26,911 and $27,986 respectively, of aggregate underwriting
commissions, all of which it retained. Of these amounts, $8,832 and $10,648,
respectively, of such commissions were attributable to The Crowley Growth and
Income Portfolio, and $18,079 and $17,338, respectively, were attributable to
The Crowley Income Portfolio for the same periods. The Crowley Diversified
Management Portfolio has never been offered with a sales load.
ALLOCATION OF PORTFOLIO BROKERAGE
The Crowley Portfolio Group, Inc., in effecting the purchases and sales of
portfolio securities for the account of the Fund, will seek execution of trades
either: (i) at the most favorable and competitive rate of commission charged by
any broker, dealer or member of an exchange; or (ii) at a higher rate of
commission charges if reasonable in relation to brokerage and research services
provided to the Fund or the Investment Advisor by such member, broker, or
dealer. Such services may include, but are not limited to, any one or more of
the following: Information as to the availability of securities for purchase or
sale; statistical or factual information or opinions pertaining to investments.
The Fund's Investment Advisor may use research and services provided to it by
brokers and dealers in servicing all its clients, however, not all such services
will be used by the Investment Advisor in connection with the Fund. Brokerage
may also be allocated to dealers in consideration of the Fund's share
distribution but only when execution and price are comparable to that offered by
other brokers.
-7-
<PAGE>
The Investment Advisor is responsible for making the Fund's portfolio
decisions subject to instructions described in the prospectus. The Board of
Directors may, however, impose limitations on the allocation of portfolio
brokerage. For the fiscal years ending November 30, 1993, 1994 and 1995,
aggregate brokerage commissions for The Crowley Growth and Income Portfolio
amounted to $19,446, $10,915, and $9,232, respectively; for The Crowley Income
Portfolio, commissions amounted to $540, $350 and $250, respectively. For the
period April 3, 1995 to November 30, 1995, aggregate brokerage commissions for
The Crowley Diversified Management Portfolio amounted to $0.
TRANSFER AGENCY FUNCTION
The Crowley Financial Group, Inc. ("CFG") serves as the Fund's transfer
agent, dividend disbursing agent and redemption agent for redemptions,
performing all the usual or ordinary services required, including: receiving and
processing orders and payments for purchases of shares, opening stockholder
accounts, preparing annual stockholder meeting lists, mailing proxy material,
receiving and tabulating proxies, mailing stockholder reports and prospectuses,
withholding certain taxes on nonresident alien accounts, disbursing income
dividends and capital distributions, preparing and filing U.S. Treasury
Department Form 1099 (or equivalent) for all stockholders, preparing and mailing
confirmation forms to stockholders for all purposes and redemption of the Fund's
shares and all other confirmable transactions in stockholders' accounts,
recording reinvestment of dividends and distributions of the Fund's shares and
causing redemption of shares for and disbursements of proceeds to withdrawal
plan stockholders. CFG is under common control with the Advisor and the
Distributor and, as compensation for its services, receives an asset-based fee.
PURCHASE OF SHARES
The shares of each Portfolio of the Fund are continuously offered by the
Distributor. Orders will not be considered complete until receipt by the
Distributor of a completed account application form, and receipt by the
Custodian of payment for the shares purchased. Once both are received, such
orders will be confirmed at the next determined net asset value (based upon
valuation procedures described in the prospectus) as of the close of business of
the business day on which the completed order is received, normally 4:00 p.m.
Eastern Time. Completed orders received by the Fund after 4:00 p.m. will be
confirmed at the next day's price.
Tax-Sheltered Retirement Plans
Shares of each Portfolio of the Fund are available to all types of
tax-deferred retirement plans including IRA's, Keogh Plans and tax-sheltered
custodial accounts described in Section 403(b)(7) of the Internal Revenue Code.
Qualified investors benefit from the tax-free compounding of income dividends
and capital gains distributions.
Individual Retirement Accounts (IRA) -- Individuals, who are not active
participants (and, when a joint return is filed, who do not have a spouse who is
an active participant) in an employer maintained retirement plan are eligible to
contribute on a deductible basis to an IRA account. The IRA deduction is also
retained for individual taxpayers and married couples with adjusted gross
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<PAGE>
incomes not in excess of certain specified limits. All individuals who have
earned income may make nondeductible IRA contributions to a separate account to
the extent that they are not eligible for a deductible contribution. Income
earned by an IRA account will continue to be tax deferred. A special IRA program
is available for employers under which the employers may establish IRA accounts
for their employees in lieu of establishing tax qualified retirement plans.
Known as SEP-IRAs (Simplified Employee Pension-IRA), they free the employer of
many of the recordkeeping requirements of establishing and maintaining a
tax-qualified retirement plan trust.
If you have received a lump sum distribution from another qualified
retirement plan, you may rollover all or part of that distribution into the
Fund's IRA. Your rollover contribution is not subject to the limits on annual
IRA contributions. By acting within applicable time limits, you can continue to
defer Federal income taxes on your lump sum contribution and on any income that
is earned on that contribution.
Keogh Plans for Self-Employed -- If you are a self-employed individual, you
may establish a Self-Employed Retirement (Keogh) Plan and contribute up to the
maximum amounts permitted for your plan under current tax laws. Under a Defined
Benefit Keogh Plan, you may establish a program with a specific amount of
retirement income as your objective. The annual contributions needed to achieve
this goal are calculated actuarially and can sometimes exceed the tax-deductible
contributions allowed under a regular Keogh Plan.
Tax-Sheltered Custodial Accounts -- If you are an employee of a public
school, state college or university, or a nonprofit organization exempt from tax
under Section 501(c)(3) of the Internal Revenue Code, you may be eligible to
make contributions into a custodial account (pursuant to section 403(b)(7) of
the IRC) which invests in Fund shares. Such contributions, to the extent that
they do not exceed certain limits, are excludable from the gross income of the
employee for federal income tax purposes.
How to Establish Retirement Accounts -- All the foregoing retirement plan
options require special plan documents. Please call us to obtain information
regarding the establishment of retirement plan accounts. In the case of IRA and
Keogh Plans, Delaware Charter Guarantee and Trust Company acts as the plan
custodian and charges nominal fees in connection with plan establishment and
maintenance. These fees are detailed in the plan documents. You should consult
with your attorney or other tax advisor for specific advice prior to
establishing a plan.
OFFICERS AND DIRECTORS OF THE FUND
The directors and principal executive offers and their principal
occupations for the past five years are listed below.
<TABLE>
<CAPTION>
Position and
Office with Principal Occupation
Name, Address and Age the Fund during the past five years
<S> <C> <C>
*Robert A. Crowley (37) President, Treasurer Vice President, Crowley & Crowley Corp. (financial
1813 Marsh Road and Director planning and registered investment advisor)
Suite H (formerly Crowley Planning
Wilmington, DE 19810
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<PAGE>
& Management Corp.) from November, 1986 until
present; Vice President, The Crowley Financial
Group, Inc. (financial management firm and
transfer agent) from February, 1990 to present;
Vice President, Crowley Real Estate Services, Inc.
from September, 1986 until present; Partner,
Crowley Securities (registered broker-dealer) from
February, 1985 until present; Partner, Crowley
Insurance, July, 1986 until present.
*Frederick J. Vice President, President, Crowley & Crowley Corp. (financial
Crowley, Jr. (39) Secretary, and planning and registered investment advisor)
1813 Marsh Road Director (formerly Crowley Planning & Management Corp.)
Suite H from November, 1986 until present; President and
Wilmington, DE 19810 Treasurer, The Crowley Financial Group, Inc.
(financial management firm and transfer agent)
from February, 1990 to present; Vice President,
Crowley Real Estate Services, Inc. from September,
1986 until present; Partner, Crowley Securities
(registered broker-dealer) from February, 1985
until present; Partner, Crowley Insurance, July,
1985 until present.
William O. Cregar (70) Director Retired. Formerly Security Director, E.I.
4556 Simon Road duPont de Nemours & Co. until December, 1990
Wilmington, DE 19803
Bruce A. Humphries (48) Director Operations Planning Manager for Virology
2 Radburn Lane Business, E.I. duPont de Nemours & Co.,
Hillstream 1987 to Present.
Newark, DE 19711
Daniel J. Piscitello (54) Director Director of Creative Services, Lenox
3933 Branches Lane Collections, 1986 to Present.
Doylestown, PA 18901
Peter Veenema (46) Director Senior Research Engineer, E.I. duPont
1211 Norbee Drive de Nemours, 1989 to Present.
Normandy Manor
Wilmington, DE 19803
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<PAGE>
Catherine C. Crowley (60) Assistant Secretary Office Manager, Crowley & Crowley Corp.
1813 Marsh Road & Assistant Treasurer (financial planning and registered investment
Suite H advisor) (formerly Crowley Planning &
Wilmington, DE 19810 Management Corp.); Secretary, The Crowley
Financial Group, Inc. (financial management
firm and transfer agent) from February, 1990
to present.
</TABLE>
_______________________
*"Interested" director as defined in the Investment Company Act of 1940
(the "1940 Act")
The officers conduct and supervise the daily business operations of the
Fund, while the directors, in addition to functions set forth under "Advisor"
and "Distributor" review such actions and decide on general policy. Compensation
to officers and directors of the Fund who are affiliated with the Investment
Advisor or the Distributor is paid by the Investment Advisor or the Distributor,
respectively, and not by the Fund. Each non-affiliated director of the Fund
received $1,500 for the fiscal year ending November 30, 1995. Robert A. Crowley
and Frederick J. Crowley, Jr. are brothers, and the sons of Catherine C.
Crowley.
<TABLE>
<CAPTION>
Pension or Total
Retirement Estimated Compensation
Benefits Annual from Fund
Accrued as Benefits and Fund
Name of Person, Aggregate Part of Upon Complex Paid
Position with Fund Compensation Expenses Retirement to Directors*
<S> <C> <C> <C> <C>
Robert A. Crowley, $0 $0 $0 $0
President, Treasurer and
Director
Frederick J. Crowley, Jr., $0 $0 $0 $0
Vice President, Secretary
and Director
William O. Cregar, $1,500 $0 $0 $1,500
Director
Bruce A. Humphries, $1,500 $0 $0 $1,500
Director
Daniel J. Piscitello, $1,500 $0 $0 $1,500
Director
Peter Veenema, Director $1,500 $0 $0 $1,500
</TABLE>
* The "Fund Complex" presently consists of three investment companies, each
an individual series of the Registrant.
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<PAGE>
OWNERSHIP OF SECURITIES
As of February 29, 1996, the Directors and Officers of the Fund owned
beneficially, in the aggregate, 55,191.300 shares (8.87%) of The Crowley Growth
and Income Portfolio. As of February 29, 1996, the Directors and Officers of the
Fund owned beneficially, in the aggregate, 57,740.330 shares (6.59%) of The
Crowley Income Portfolio. As of February 29, 1996, the Directors and Officers of
the Fund owned beneficially, in the aggregate, 6,733.052 shares (7.33%) of The
Crowley Diversified Management Portfolio. As of the same date, Daniel J.
Piscitello, a Director of the Fund, owned beneficially 5,051.355 shares (5.5%)
of The Crowley Diversified Management Portfolio.
At February 29, 1996 the following individuals owned greater than five
percent (5%) of a Portfolio of the Fund: (i) The Crowley Income Portfolio:
Ronald Cooney, Wilmington, DE - 8.7%; (ii) The Crowley Diversified Management
Portfolio: Albert R. and Patricia A. Forster, Chadds Ford, PA, 11.7%; Regina S.
Webb, Lewis, DE, 6.5%; Diane M. Olsen, Wilmington, DE, 9.2%, David and Brenda
Jones, Lewis, DE, 6.6%.
GENERAL INFORMATION
Audits and Reports
The accounts of the Fund are audited each year by Tait, Weller & Baker of
Philadelphia, PA, independent certified public accountants whose selection must
be ratified annually by the shareholders. Shareholders receive semi-annual and
annual reports of the Fund including the annual audited financial statements and
a list of securities owned.
Custodian
The Fund has retained Wilmington Trust Company, Rodney Square North,
Wilmington, DE 19890 (the "Custodian Bank"), to act as custodian of the
securities and cash of the Fund.
PERFORMANCE
Current yield and total return may be quoted in advertisements, shareholder
reports or other communications to shareholders. Yield is the ratio of income
per share derived from a Portfolio's investments to a current maximum offering
price expressed in terms of percent. The yield is quoted on the basis of
earnings after expenses have been deducted. Total return is the total of all
income and capital gains paid to shareholders, assuming reinvestment of all
distributions, plus (or minus) the change in the value of the original
investment, expressed as a percentage of the purchase price. Occasionally, the
Fund may include its distribution rate in advertisements. The distribution rate
is the amount of distributions per share made by the Fund over a 12-month period
divided by the current maximum offering price.
U.S. Securities and Exchange Commission rules require the use of
standardized performance quotations or, alternatively, that every
non-standardized performance quotation furnished by the Fund be accompanied by
certain standardized performance information computed as required
-12-
<PAGE>
by the Commission. Current yield and total return quotations used by the Fund
are based on the standardized methods of computing performance mandated by the
Commission. An explanation of those and other methods used by the Fund to
compute or express performance follows.
The yield for The Crowley Income Portfolio for the 30-day period ended on
November 30, 1995 was 6.35%.
As indicated below, current yield is determined 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 and annualizing the result.
Expenses accrued for the period include any fees charged to all shareholders
during the 30-day base period. According to the SEC formula:
6
Yield = 2 [(a-b +1) - 1]
cd
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.
The average annual total return figures for The Crowley Income Portfolio
for the 1 year period ending November 30, 1995, for the 5 year period ending
November 30, 1995, and for the period from inception to November 30, 1995, were
10.12%, 7.40% and 7.63%, respectively; for The Crowley Growth and Income
Portfolio for the 1 year period ending November 30, 1995, for the 5 year period
ending November 30, 1995, and for the period from inception to November 30,
1995, were 11.85%, 8.29% and 6.34%, respectively. The average total return
figure (not annualized) for The Crowley Diversified Management Portfolio for the
period from inception to November 30, 1995 was 7.10%.
As the following formula indicates, the average annual total return is
determined by multiplying a hypothetical initial purchase order of $1,000 by the
average annual compound rate of return (including capital
appreciation/depreciation and dividends and distributions paid and reinvested)
for the stated period less any fees charged to all shareholder accounts and
annualizing the result. The calculation assumes the maximum sales load is
deducted from the initial $1,000 purchase order and that all dividends and
distributions are reinvested at the public offering price on the reinvestment
dates during the period. The quotation assumes the account was completely
redeemed at the end of each one, five and ten-year period and assumes the
deduction of all applicable charges and fees. According to the SEC formula:
-13-
<PAGE>
n
P(1+T) = ERV
where:
P = a hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the 1, 5 or 10-year periods, determined at
the end of the 1, 5 or 10-year periods (or fractional portion
thereof).
Regardless of the method used, past performance is not necessarily
indicative of future results, but is an indication of the return to shareholders
only for the limited historical period used.
Comparisons and Advertisements
To help investors better evaluate how an investment in a Portfolio of the
Fund might satisfy their investment objective, advertisements regarding the
Fund's Portfolios may discuss yield or total return for a Portfolio as reported
by various financial publications. Advertisements may also compare yield or
total return to yield or total return as reported by other investments, indices,
and averages. The following publications, indices, and averages may be used:
Lipper Mutual Fund Performance Analysis
Lipper Fixed Income Analysis
Lipper Mutual Fund Indices
Morgan Stanley World Index
Shearson Lehman Hutton Treasury Index
Salomon Bros. Corporate Bond Index
-14-
<PAGE>
FINANCIAL STATEMENTS
The Fund's audited financial statements, related notes and the report of
Tait, Weller & Baker for the fiscal year ended November 30, 1995, as set forth
in the Fund's Annual Report to Stockholders dated November 30, 1995, are
incorporated herein by reference. A shareholder may obtain a copy of the Annual
Report to Stockholders upon request and without charge by contacting the Fund at
the address or telephone number appearing on the cover of the Statement of
Additional Information.
-15-
<PAGE>
INVESTMENT ADVISOR
Crowley & Crowley Corp.
1813 Marsh Road
Suite H
Wilmington, DE 19810
DISTRIBUTOR
Crowley Securities
1813 Marsh Road
Suite H
Wilmington, DE 19810
TRANSFER AGENT
The Crowley Financial Group, Inc.
1813 Marsh Road
Suite H
Wilmington, DE 19810
CUSTODIAN
Wilmington Trust Company
Rodney Square North
Wilmington, DE 19890
LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103-7098
AUDITORS
Tait, Weller & Baker
Two Penn Center
Suite 700
Philadelphia, PA 19102-1707
<PAGE>
PART C
OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements:
Included in Part A:
Financial Highlights for The Crowley Growth and Income Portfolio
(formerly, The Crowley Growth Portfolio) and The Crowley Income
Portfolio for the fiscal years ended November 30, 1995, 1994, 1993,
1992, 1991 and for the period December 6, 1989 (inception) to November
30, 1990 (audited).
Financial Highlights for The Crowley Diversified Management Portfolio
for the period from April 3, 1995 (inception) through November 30,
1995 (audited).
*Part B:
Portfolio of Investments at November 30, 1995 (audited)
Statement of Assets and Liabilities at November 30, 1995 (audited)
Statement of Operations at November 30, 1995 (audited)
Statement of Changes in Net Assets at November 30, 1995 (audited)
Notes to Financial Statements at November 30, 1995 (audited)
Report of Independent Public Accountants dated December 15, 1995
(b) (1) Registrant's Articles of Incorporation dated August 15, 1989.
(a) Articles Supplementary effective March 22, 1995 to
Registrant's Articles of Incorporation dated August 15,
1989.
- --------
* The financial statements and Accountants Report listed above are
incorporated by reference into Part B from the Registrant's Annual Report
to Stockholders for the fiscal year ended November 30, 1995, which is
included herein as an Exhibit.
<PAGE>
(b) Articles of Amendment effective March 29, 1996 to
Registrant's Articles of Incorporation dated August 15,
1989.
(3) Not applicable.
(4) (a) Specimen copy of The Crowley Growth and Income Portfolio
certificate denoting securities to be issued by the
Registrant.
(b) Specimen copy of The Crowley Income Portfolio certificate
denoting securities to be issued by the Registrant.
(c) Specimen copy of The Crowley Diversified Management
Portfolio certificate denoting securities to be issued by
the Registrant.
(5) (a) Management Contract dated December 6, 1989 between Crowley &
Crowley Corp. and the Registrant for The Crowley Growth
Portfolio.
(b) Management Contract dated December 6, 1989 between Crowley &
Crowley Corp. and the Registrant for The Crowley Income
Portfolio.
(c) Management Contract dated March 31, 1995 between Crowley &
Crowley Corp. and the Registrant for The Crowley Diversified
Management Portfolio.
(6) (a) Underwriting Agreement dated December 6, 1989 between
Crowley Securities and the Registrant for The Crowley Growth
Portfolio.
(b) Underwriting Agreement dated December 6, 1989 between
Crowley Securities and the Registrant for The Crowley Income
Portfolio.
(c) Underwriting Agreement dated March 31, 1995 between Crowley
Securities and the Registrant for The Crowley Diversified
Management Portfolio.
(d) Form of Dealer Selling Agreement.
(7) Not applicable.
(8) (a) Custodian Agreement dated November 29, 1989 between
Registrant and Wilmington Trust Company relating to The
Crowley Growth Portfolio.
<PAGE>
(b) Custodian Agreement dated November 29, 1989 between
Registrant and Wilmington Trust Company relating to The
Crowley Income Portfolio.
(c) Custodian Agreement dated March 31, 1995 between Registrant
and Wilmington Trust Company relating to The Crowley
Diversified Management Portfolio.
(9) Shareholder Services Agreement dated August 1, 1993.
(a) Amendment I dated March 31, 1995 to Shareholder Services
Agreement dated August 1, 1993.
(10) Opinion and consent of counsel as to the legality of the
Registrant's securities being registered. (Supplied along with
Registrant's Notice pursuant to Rule 24f-2 of the Investment
Company Act of 1940, filed electronically on January 26, 1996.)
(11) (a) Consent of Tait, Weller & Baker, Independent Public
Accountants dated March 20, 1996.
(b) Letter of Stradley, Ronon, Stevens and Young, LLP relating
to availability of use of Rule 485(b).
(12) Not applicable.
(13) Letter from contributors of initial capital to the Registrant.
(14) Not applicable.
(15) Not applicable.
(16) Schedule for computation of performance figures.
(17) Financial Data Schedule.
(18) Annual Report to Stockholders for the fiscal year ended November
30, 1995.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL OF THE REGISTRANT.
NONE
<PAGE>
Item 26. NUMBER OF HOLDERS OF SECURITIES.
The number of record holders of each class of securities of the Registrant
as of February 29, 1996, is as follows:
(1) (2)
Title of class Number of Record Holders
The Crowley Growth and Income Portfolio 175
The Crowley Income Portfolio 164
The Crowley Diversified Management 58
Portfolio
Item 27. INDEMNIFICATION.
Under the terms of the Maryland General Corporation Law and the
Registrant's Articles of Incorporation, the Registrant shall indemnify any
person who was or is a director, officer or employee of the Registrant to the
maximum extent permitted by the Maryland General Corporation Law; provided
however, that any such indemnification (unless ordered by a court) shall be made
by the Registrant only as authorized in the specific case upon a determination
that indemnification of such persons is proper in the circumstances. Such
determination shall be made:
(i) by the Board of Directors by a majority vote of a quorum which
consists of the directors who are neither "interested persons" of
the Registrant as defined in Section 2(a)(19) of the 1940 Act,
nor parties to the proceedings; or
(ii) if the required quorum is not obtainable or if a quorum of such
Directors so directs, by independent legal counsel in a written
opinion.
No indemnification will be provided by the Registrant to any
Director or officer of the Registrant for any liability to the
Registrant or shareholders to which he would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of duty.
As permitted by Article ELEVENTH of the Registrant's Articles of
Incorporation and subject to the restrictions under ss.2-418(F)(1) of the
Maryland General Corporation Law, reasonable expenses incurred by a Director who
is a party to a proceeding may be paid by the Registrant in advance of the final
disposition of the action, after a determination that the facts then known would
not preclude indemnification, upon receipt by the Registrant of a written
affirmation by the Director of the Director's good faith belief that the
standard of conduct necessary for indemnification by the company has been met
and a written undertaking by or on behalf of the Director to repay the amount if
it is ultimately determined that the standard of conduct has not been met.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR.
<PAGE>
The principal business of Crowley & Crowley Corp. is to provide investment
counsel and advice to individual investors.
Item 29. PRINCIPAL UNDERWRITERS.
(a) Crowley Securities, Inc., the only principal underwriter of the
Registrant, does not act as principal underwriter, depositor or
investment advisor to any other investment company.
(b) Herewith is the information required by the following table with
respect to each director, officer or partner of the only
underwriter named in answer to Item 21 of Part B:
Position and Position and
Name and Principal Offices with Offices with
Business Address Underwriter Registrant
Robert A. Crowley General Partner President
1813 Marsh Road
Suite H
Wilmington, DE 19810
Frederick J. General Partner Vice President
Crowley, Jr.
1813 Marsh Road
Suite H
Wilmington, DE 19810
(c) Not applicable.
Item 30. LOCATION OF ACCOUNTS AND RECORDS.
All records described in Section 31(a) of the Investment Company Act of
1940, as amended, and the Rules 17 CFR 270.31a-1 to 31a-31 promulgated
thereunder, are maintained by the Registrant's Investment Advisor, Crowley &
Crowley Corp., 1813 Marsh Rd., Suite H, Wilmington, DE 19810, except for those
maintained by the Registrant's custodian, Wilmington Trust Company, Rodney
Square North, Wilmington, DE 19890, and the Registrant's administrator,
transfer, redemption, dividend disbursing and accounting agent, The Crowley
Financial Group, Inc., 1813 Marsh Rd., Suite H, Wilmington, DE 19810.
Item 31. MANAGEMENT SERVICES.
All management services are covered in the management agreement between the
Registrant and Crowley & Crowley Corp., as discussed in Parts A and B.
<PAGE>
Item 32. UNDERTAKINGS.
(1) Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to Directors, officers and controlling persons of
the Registrant, the Registrant has been advised that in the opinion of the U.S.
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a Director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such Director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(2) Registrant hereby undertakes, if requested to do so by the holders of
at least 10% of the Registrant's outstanding shares, to call a meeting of
shareholders for the purpose of voting upon the question of removal of a trustee
or trustees and to assist in communication with other shareholders, as directed
by Section 16(c) of the Investment Company Act of 1940.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that this amendment meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933, and has duly caused this amendment
to its Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in Wilmington, Delaware, on the 7th day of March,
1996.
THE CROWLEY PORTFOLIO GROUP, INC.
By: /s/ Robert A. Crowley, President
Robert A. Crowley, President
Pursuant to the requirements of the Securities Act of 1933, this amendment to
Registrant's Registration Statement has been signed below by the following
persons in the capacities and on the date indicated.
Signature Title Date
/s/ Robert A. Crowley President, Treasurer March 7, 1996
- -------------------------------
Robert A. Crowley and Director
/s/ Frederick J. Crowley, Jr. Vice President, Secretary March 7, 1996
- -------------------------------
Frederick J. Crowley, Jr. and Director
/s/ William O. Cregar Director March 7, 1996
- -------------------------------
William O. Cregar
/s/ Bruce A. Humphries Director March 7, 1996
- -------------------------------
Bruce A. Humphries
Director March __, 1996
- -------------------------------
Daniel J. Piscitello
/s/ Peter Veenema Director March 7, 1996
- -------------------------------
Peter Veenema
<PAGE>
EXHIBIT INDEX
Item 24(b) Document Page
1 Articles of Incorporation
1(a) Articles Supplementary to Articles of Incorporation
effective March 22, 1995.
1(b) Articles of Amendment to Articles of Incorporation
effective March 29, 1996.
2 By-Laws, as amended.
4(a) Specimen stock certificate for The Crowley Growth
and Income Portfolio
4(b) Specimen stock certificate for The Crowley Income
Portfolio
4(c) Specimen stock certificate for The Crowley
Diversified Management Portfolio
5(a) Management Contract dated December 6, 1989 between
Crowley & Crowley Corp. and the Registrant for The
Crowley Growth Portfolio.
5(b) Management Contract dated December 6, 1989 between
Crowley & Crowley Corp. and the Registrant for The
Crowley Income Portfolio.
5(c) Management Contract dated March 31, 1995 between
Crowley & Crowley Corp. and the Registrant for The
Crowley Diversified Management Portfolio.
6(a) Underwriting Agreement between Crowley Securities
and the Registrant for The Crowley Growth Portfolio.
6(b) Underwriting Agreement between Crowley Securities
and the Registrant for The Crowley Income Portfolio.
6(c) Underwriting Agreement between Crowley Securities
and the Registrant for The Crowley Diversified
Management Portfolio.
<PAGE>
6(d) Form of Dealer Selling Agreement.
8(a) Custodian Agreement between Registrant and
Wilmington Trust Company relating to The Crowley
Growth Portfolio.
8(b) Custodian Agreement between Registrant and
Wilmington Trust Company relating to The Crowley
Income Portfolio.
8(c) Custodian Agreement between Registrant and
Wilmington Trust Company relating to The Crowley
Diversified Management Portfolio.
9 Shareholder Services Agreement dated August 1, 1993.
9(a) Amendment to Shareholder Services Agreement dated
March 31, 1995.
11(a) Consent of Tait, Weller & Baker.
11(b) Letter from Stradley, Ronon, Stevens & Young LLP.
13 Letter from contributors of initial capital to
Registrant.
16 Schedule for Computation of Performance Figures.
17 Financial Data Schedule.
18 Annual Report to Stockholders for the fiscal year
ended November 30, 1995.
ARTICLES OF INCORPORATION
OF
THE CROWLEY PORTFOLIO GROUP, INC.
FIRST: The undersigned, Bruce G. Leto, whose post office address is 2600
One Commerce Square, Philadelphia, PA 19103, being at least eighteen years of
age, hereby associate myself as incorporator with the intention of forming a
corporation (hereinafter referred to as the "Corporation") under the general
laws of the State of Maryland.
SECOND: The name of the corporation is:
The Crowley Portfolio Group, Inc.
THIRD: The purpose for which the Corporation is formed is to operate as an
open-end, diversified management investment company, registered under the
Investment Company Act of 1940, and to exercise all of the powers and to do any
and all of the things as fully and to the same extent as any other corporation
incorporated under the general laws of the State of Maryland, now or hereinafter
in force, including, without limitation, the following:
1. To purchase, hold, invest and reinvest in, sell, exchange,
transfer, mortgage, and otherwise acquire and dispose of securities of every
kind, character, and,description.
2. To exercise all rights, powers, and privileges with reference to or
incident to ownership, use, and enjoyment of any of such securities, including,
but without limitation, the right, power, and privilege to own, vote, hold,
purchase, sell, negotiate, assign, exchange, transfer, mortgage, pledge or
otherwise deal with, dispose of, use, exercise, or enjoy any rights, title,
interest, powers, or privileges under or with reference to any of such
securities; and to do any and all acts and things for the preservation,
protection, improvement, and enhancement in value of any of such securities.
3. To purchase or otherwise acquire, own, hold, sell, exchange,
assign, transfer, mortgage, pledge, or otherwise dispose of, property of all
kinds.
4. To buy, sell, mortgage, encumber, hold, own, exchange, rent, or
otherwise acquire and dispose of, and to develop, improve, manage, subdivide,
and generally to deal and trade in real property, improved and unimproved,
wheresoever situated; and to build, erect, construct, alter, and maintain
buildings, structures, and other improvements on real property.
<PAGE>
5. To borrow or raise money for any lawful corporate purpose, and to
mortgage or pledge the whole or any part of the property and franchises of the
corporation, real, personal, mixed, tangible or intangible, and wheresoever
situated.
6. To enter into, make, and perform contracts and undertakings of
every kind for any lawful purpose, without limit as to amount.
7. To issue, purchase, sell, transfer, reacquire, hold, trade and deal
in, to the extent permitted under the Maryland General Corporation Law, capital
stock, bonds, debentures and other securities of the Corporation, from time to
time, to such extent as the Board of Directors shall determine, consistent with
the provisions of these Articles of Incorporation; and to repurchase,
re-acquire, and redeem, to the extent permitted under the Maryland General
Corporation Law, from time to time, the shares of its own capital stock, bonds,
debentures, and other securities.
The foregoing clauses shall each be construed as purposes,
objects, and powers, and it is hereby expressly provided that the foregoing
enumeration of specific purposes, objects, and powers shall not be held to limit
or restrict in any manner the powers of the Corporation, and that they are in
furtherance of, and in addition to, and not in limitation of, the general powers
conferred upon the Corporation by the laws of the state of Maryland or
otherwise; nor shall the enumeration of one thing be deemed to exclude another,
although it be of like nature, not expressed.
Notwithstanding the foregoing, the powers of the Corporation
shall be limited to the extent, but only to the extent, that the Investment
Company Act of 1940 does not permit the Corporation to engage in activities
which would otherwise be permissible corporate acts in accordance with the
general laws of the state of Maryland.
FOURTH: The post office address of the principal office of the Corporation
in the state of Maryland is:
c/o The Corporation Trust Incorporated 32 South Street Baltimore,
Maryland 21202
The name and post office address of the initial resident agent of
the Corporation in the state of Maryland is:
The Corporation Trust Incorporated 32 South Street Baltimore,
Maryland 21202
-2-
<PAGE>
FIFTH: The total number of shares of stock which the Corporation shall have
authority to issue is Five Hundred Million (500,000,000) shares of stock, with a
par value of one Cent ($.01) per share, to be known and designated as Common
Stock, all such shares of Common Stock having an aggregate par value of Five
Million Dollars ($5,000,000). The Board of Directors may increase the amount of
the authorized shares of stock and aggregate capital pursuant to Section 2-105
of the Maryland General Corporation Law.
Subject to the provisions of these Articles of Incorporation, the
Board of Directors shall have the power to issue shares of Common Stock of the
Corporation from time to time, at a price not less than the net asset value or
par value thereof, whichever is greater, for such consideration as may be fixed
by the Board of Directors.
Pursuant to Section 2-105 of the Maryland General Corporation
Law, the Board of Directors of the Corporation shall have the power to designate
one or more series of shares of Common Stock, or classes of such series, and may
classify or reclassify any unissued shares with respect to such series or class,
and such series (subject to any applicable rule, regulation or order of the
Securities and Exchange Commission or other applicable law or regulation) shall
have such preferences, conversion, or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, terms, and conditions of redemption
and other characteristics as the Board may determine in the absence of a
contrary determination set forth herein. In furtherance of the aforesaid power
of the Board of Directors, two series of shares of the Corporation's Common
Stock are hereby initially designated as: "The Crowley Growth Portfolio" series,
with one Hundred Fifty Million (150,000,000) shares of Common Stock hereby
initially classified and allocated thereto; and "The Crowley Income Portfolio"
series with one Hundred Fifty million (150,000,000) shares of Common Stock
hereby initially classified and allocated thereto.
At any time when there are no shares outstanding or subscribed
for a particular series or class previously established and designated herein or
by the Board of Directors, the series or class may be liquidated by similar
means. Each share of a series shall have equal rights with each other share of
that series with respect to the assets of the Corporation pertaining to that
series. The dividends payable to the holders of any series (subject to any
applicable rule, regulation or order of the Securities and Exchange Commission
or any other applicable law or regulation) shall be determined by the Board and
need not be individually declared, but may be declared and paid in accordance
with a formula adopted by the Board. Except as otherwise provided herein, all
references in these Articles of
-3-
<PAGE>
Incorporation to Common Stock or series of stock shall apply without
discrimination to the shares of each series of stock.
The holder of each share of stock of the Corporation shall be
entitled to one vote for each full share, and a fractional vote for each
fractional share of stock, irrespective of the series then standing in his or
her name in the books of the Corporation. On any matter submitted to a vote of
stockholders, all shares of the Corporation then issued and outstanding and
entitled to vote, irrespective of the series, shall be voted in the aggregate,
and not by series, except (1) when otherwise expressly provided by the Maryland
General Corporation Law, or (2) when required by the Investment Company Act of
1940, as amended, shares shall be voted by individual series or class, or (3)
when the matter does not affect any interest of a particular series (e.g., a
portfolio name change), then only stockholders of affected series shall be
entitled to vote thereon. There shall be no cumulative voting.
Each series of stock of the Corporation shall have the following
powers and preferences, and participating, voting, or other special rights; and
the qualifications, restrictions, and limitations thereof shall be as follows:
1. All consideration received by.the Corporation for the issue or sale
of stock of each series, together with all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation thereof, and any funds or payments derived form any reinvestment of
such proceeds in whatever form the same may be, shall irrevocably belong to the
series of shares of stock with respect to which such assets, payments, or funds
were received by the Corporation for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of the Corporation.
Such assets, income, earnings, profits and proceeds thereof, including any
proceeds derived from the sale, exchange, or liquidation thereof, and any assets
derived from any reinvestment of such proceeds, in whatever form the same may
be, are herein referred to as "assets belonging to" such series.
2. The Board of Directors may from time to time declare and pay
dividends or distributions, in stock or in cash, on any or all series of stock,
provided, such dividends or distributions on shares of any series of stock shall
be paid only out of earnings, surplus, or other legally available funds
belonging to such series.
3. The Board of Directors shall have the power to distribute to the
stockholders of the corporation or to the stockholders of any series thereof in
any fiscal year as dividends, including dividends designated in whole or in part
as capital gain distributions, amounts sufficient, in the opinion of
-4-
<PAGE>
the Board of Directors, to enable the Corporation or any series thereof to
qualify as a "regulated investment company" under the Internal Revenue Code of
1986, as amended, or any successor or comparable statute thereto, and
regulations promulgated thereunder (collectively, the "IRC"), and to avoid
liability of the Corporation or any series thereof for Federal income tax in
respect of that year and to make other appropriate adjustments in connections
therewith.
4. The Board of Directors shall have the power, in its discretion, to
make such elections as to the tax status of the Corporation or any series or
class of the Corporation as may be permitted or required by the IRC as presently
in effect or an amended, without the vote of stockholders of the Corporation or
any series or class thereof.
5. In the event of the liquidation or dissolution of the Corporation,
stockholders of each series shall be entitled to receive, as a series, out of
the assets of the Corporation available for distributing to stockholders, but
other than general assets not belonging to any particular series of stock, the
assets belonging to such series, and the assets so distributable to the
stockholders of any series shall be distributed among such stockholders in
proportion to the number of shares of such series held by them and recorded on
the books of the corporation. In the event that there are any general assets not
belonging to any particular series of stock and available for distribution, such
distribution shall be made to the holders of stock of all series in proportion
to the net asset value of the respective series determined as hereinafter
provided.
6. The assets belonging to any series of stock shall be charged with
the liabilities in respect to such series, and shall also be charged with its
shares of the general liabilities of the Corporation, in proportion to the net
asset value of the respective series determined as hereinafter provided. The
determination of the Board of Directors shall be conclusive as to the amount of
liabilities, including accrued expenses and reserves, as to the allocation of
the same as to a given series, and as to whether the same or general assets of
the Corporation are allocable to one or more series.
The net asset value per share of a series of the Corporation's
common stock shall be determined in accordance with the Investment Company Act
of 1940, as amended, and with generally accepted accounting principles, by
adding the market or appraised value of all securities, cash and other assets of
the corporation pertaining to that series, subtracting the liabilities
determined by the Board of Directors to be applicable to that series, allocating
any general assets and general liabilities to that series, and dividing the net
result by the
-5-
<PAGE>
number of shares of that series outstanding. Securities and other investments
and assets will be valued at the current market value, and in the absence of a
readily available market value, will be valued at fair value as determined in
good faith by the Board of Directors.
7. The Board of Directors may provide for a holder of any series of
stock of the Corporation, who surrenders his certificate in good form for
transfer to the Corporation or, if the shares in question are not represented by
certificates, who delivers to the Corporation a written request in good order
signed by the stockholder, to convert the shares of stock in question on such
basis as the Board may provide, into shares of stock of any other series of the
corporation
8. The holders of the shares of Common Stock or other securities of
the Corporation shall have no preemptive rights to subscribe to new or
additional shares of its Common Stock or other securities.
SIXTH: The number of directors of the Corporation which shall constitute
the whole Board shall be determined from time to time by the Board of Directors,
but shall not be fewer than three nor more than fifteen, as provided in the
By-Laws; and further provided, notwithstanding the foregoing, the board of
directors shall initially consist of (6) directors until such time as the number
of directors is fixed as stated above. The name of the directors who shall act
as such until successors are duly chosen and qualify are:
Robert A. Crowley Bruce A. Humphries
Frederick J. Crowley, Jr Daniel J. Piscitello
William O. Cregar Peter Veenema
SEVENTH: The following provisions refer to the management of the business
and the conduct of the Corporation's affairs:
1. The Board of Directors shall have the power to fix an initial
offering price for the shares of any series which shall yield to the Corporation
not less than the par value thereof, at which price the shares of the Common
Stock of the Corporation shall be offered for sale, and to determine from time
to time thereafter the offering price which shall yield to the Corporation not
less than the par value thereof from sales of its Common Stock; provided,
however, that no shares of the Common Stock of the Corporation shall be issued
or sold for a consideration which shall yield to the Corporation less than the
net asset value of shares of such series determined as hereinafter provided, as
of the business day on which such shares are sold, or at such other times set by
the Board of Directors, except in the case of shares of such Common Stock issued
in payment of a dividend properly declared and payable.
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The net asset value of the property and assets of any series of
the Corporation shall be determined at such times as the Board of Directors may
direct, by deducting from the total appraised value of all of the property and
assets of the corporation, determined in the manner hereinafter provided, all
debts, obligations and liabilities of the Corporation (including, but without
limitation of the generality of any of the foregoing, any or all debts,
obligations, liabilities or claims of any and every kind and nature, whether
fixed, accrued, or unmatured, and any reserves or charges, determined in
accordance with generally accepted accounting principles, for any or all
thereof, whether for taxes, including estimated taxes or unrealized book
profits, expenses, contingencies or otherwise).
In determining the total appraised value of all the property and
assets of the Corporation or belonging to any series thereof:
(a) Securities owned shall be valued at market value or, in
the absence of readily available market quotations, at fair value as determined
in good faith by or as directed by the Board of Directors in accordance with
applicable statutes and regulations.
(b) Dividends declared but not yet received, or rights, in
respect of securities which are quoted ex-dividend or ex-rights, shall be
included in the value of such securities as determined by or pursuant to the
direction of the Board of Directors on the day the particular securities are
first quoted ex-dividend or ex-rights, and on each succeeding day until the said
dividends or rights are received and become part of the assets of the
Corporation.
(c) The value of any other assets of the Corporation (and
any of the assets mentioned in paragraphs (a) or (b), in the discretion of the
Board of Directors in the event of a national financial emergency, as
hereinafter defined) shall be determined in such manner as may be approved from
time to time by or pursuant to the direction of the Board of Directors.
The net asset value of each share of the Common Stock of the
Corporation shall be determined by dividing the total market value of the
property and assets of the relevant series of the Corporation by the total
number of shares of its Common Stock then issued and outstanding for such
series, including any shares sold by the Corporation up to and including the
date as of which such net asset value is to be determined whether or not
certificates therefor have actually been issued. In case the net asset value of
each share so determined shall include a fraction of one cent, such net asset
value of each share shall be adjusted to the nearest full cent.
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2. For the purposes of these Articles of Incorporation, a "national
financial emergency" is defined as the whole or any part of any period (i)
during which the New York Stock Exchange is closed other than customary weekend
and holiday closings, (ii) during which trading on the New York Stock Exchange
is restricted, (iii) during which an emergency exists as a result of which
disposal by the Corporation of securities owned by such series is not reasonably
practicable or it is not reasonably practicable for the Corporation fairly to
determine the value of the net assets of such series, or (iv) during any other
period when the Securities and Exchange Commission (or any succeeding
governmental authority) may for the protection of security holders of the
Corporation by order permit suspension of the right of redemption or
postponement of the date of payment on redemption; provided that applicable
rules and regulations of the Securities and Exchange Commission (or any
succeeding governmental authority) shall govern as to whether the conditions
prescribed in (ii), (iii), or (iv) exist. The Board of Directors may, in its
discretion, declare the suspension described in (iv) above at an end, and such
other suspension relating to a natural financial emergency shall terminate as
the case may be on the first business day on which said Stock Exchange shall
have reopened or the period specified in (ii) or (iii) shall have expired (as to
which in the absence of an official ruling by said Commission or succeeding
authority, the determination of the Board of Directors shall be conclusive).
To the extent permitted by applicable law, and except in the case
of a national financial emergency, the Corporation shall redeem shares of its
Common Stock from its stockholders upon request of the holder thereof which is
received by the Corporation or its designated agent during business hours of any
business day, provided that such request must be accompanied by surrender of
outstanding certificate or certificates for such shares in form for transfer,
together with such proof of the authenticity of signatures as may reasonably be
required on such shares (or, on such request in the event no certificate is
outstanding) by, or pursuant to the direction of the Board of Directors of the
Corporation, and accompanied by proper stock transfer stamps. Shares redeemed
upon any such request shall be purchased by the Corporation at the net asset
value of such shares determined in the manner provided in Paragraph (1) of this
Article Seventh, as of the close of business on the business day during
which,such request was received in good order by the Corporation.
Payments for shares of its Common Stock so redeemed by the
Corporation shall be made from the assets of the applicable series in cash,
except payment for such shares may, at the option of the Board of Directors, or
such officer or officers as they may duly authorize for such purposes, be made
from the assets of that series in kind, or partially in cash and partially
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<PAGE>
in kind. In case of any payment in kind the Board of Directors, or their
delegate, shall have absolute discretion as to what security or securities of
such series shall be distributed in kind and the amount of the same; and the
securities shall be valued for purposes of distribution at the value at which
they were appraised in computing the current net asset value of the series of
the Fund's shares, provided that any stockholder who cannot legally acquire
securities so distributed in kind by reason of the prohibitions of the
Investment Company Act of 1940 shall receive cash.
Payment for shares of its Common Stock so redeemed by the
Corporation shall be made by the Corporation as provided above within seven days
after the date on which such shares are deposited; provided, however, if payment
shall be made by delivery of assets of the corporation, as provided above, any
securities to be delivered as part of such payment shall be delivered as
promptly as any necessary transfers of such securities on the books of the
several corporations whose securities are to be delivered may be made, but not
necessarily within such seven day period.
The right of any holder of shares of the Common Stock of the
Corporation to receive dividends thereon and all other rights of such
stockholder with respect to the shares so redeemed by the Corporation shall
cease and determine from and after the time as of which the purchase price of
such shares shall be fixed, as provided above, except the right of such
stockholder to receive payment for such shares as provided for herein.
3. The Board of Directors may, from time to time, without the
affirmative vote or consent of stockholders, establish uniform standards with
respect to the minimum net asset value of a stockholder account or a minimum
investment which may be made by a stockholder. The Board of Directors may
authorize the closing of those stockholder accounts not meeting the specified
minimum standards of net asset value by redeeming all of the shares in such
accounts, provided there is mailed to each affected stockholder account, at
least thirty (30) days prior to the planned redemption date, a notice setting
forth the minimum account size requirement and the date on which the account
will be closed if the minimum size requirement is not met prior to said closing
date.
EIGHTH: (a) To the fullest extent that limitations on the liability of
directors and officers are permitted by the Maryland General Corporation Law, no
director or officer of the Corporation shall have any liability to the
Corporation or its stockholders for money damages. This limitation on liability
applies to events occurring at the time a person serves as a director or officer
of the Corporation whether or not such person
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<PAGE>
is a director or officer at the time of any proceeding in which liability is
asserted.
(b) The Corporation shall indemnify and advance expenses to
its currently acting and its former directors to the fullest extent that
indemnification of directors is permitted by the Maryland General Corporation
Law. The Corporation shall indemnify and advance expenses to its officers to the
same extent as its directors and to such further extent as is consistent with
law. The Board of Directors may by Bylaw, resolution or agreement make further
provisions for indemnification of directors, officers, employees and agents to
the fullest extent permitted by the Maryland General Corporation Law.
(c) No provision of this Article shall be effective to
protect or purport to protect any director or officer of the Corporation against
any liability to the Corporation or its security holders to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
(d) References to the Maryland General Corporation Law in
this Article are to the law as from time to time amended. No further amendment
to the Articles of Incorporation of the Corporation shall affect any right of
any person under this Article based on any event, omission or proceeding prior
to such amendment.
(e) Each provision of this Article EIGHTH shall be severable
from the remainder, and the invalidity of any such provision shall not affect
the validity of the remainder of this Article EIGHTH.
NINTH: The Corporation reserves the right to amend, alter, change, or
repeal any provision contained in these Articles of Incorporation, and all
rights, contract and otherwise, conferred herein upon the stockholders are
granted subject to such reservation.
TENTH: Notwithstanding any provision of the Maryland General Corporation
Law requiring more than a majority vote of the stockholders in connection with
the authorization of any corporate action (including but not limited to amending
the Articles of Incorporation), unless otherwise provided in the Articles of
Incorporation, the Corporation may take or authorize such action upon the
favorable vote of the holders of a majority of the outstanding voting shares of
Common Stock. This Articles TWELFTH applies with respect to any matter submitted
to a vote of the stockholders of any particular series as well as to a vote of
all of the stockholders of the Corporation.
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<PAGE>
ELEVENTH: The duration of the Corporation is perpetual.
IN WITNESS WHEREOF, the undersigned incorporator of The Crowley Funds,
Inc., who executed the foregoing Articles of Incorporation, hereby acknowledges
the same to be his act and further acknowledges that, to the best of his
knowledge, the matters and facts set forth herein are true in all material
respects under the penalties of perjury.
Date the 14th day of August, 1989.
/s/ Bruce G. Leto
Bruce G. Leto
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THE CROWLEY PORTFOLIO GROUP, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
The Crowley Portfolio Group, Inc., a Maryland corporation having its
principal office in Baltimore, Maryland (the "Corporation"), hereby certifies,
in accordance with Section 2-208 of the Maryland General Corporation Law, to the
State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation has duly adopted
resolutions classifying a third series of shares of the Corporation's Common
Stock as "The Crowley Diversified Management Portfolio" series and classifying
and allocating 150,000,000 shares of authorized and unissued Common Stock, par
value $.01 per share, to The Crowley Diversified Management Portfolio.
SECOND: The shares of The Crowley Diversifeid Management Portfolio series
shall have the same preferences, rights, voting powers, restrictions,
limitations as to dividends, qualifications, or terms or conditions of
redemption as the shares of "The Crowley Growth Portfolio" series and "The
Crowley Income Portfolio" series of the Corporation as set forth in the Articles
of Incorporation.
THIRD: The Crowley Diversified Management Portfolio series has been
classified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
IN WITNESS WHEREOF, The Crowley Portfolio Group, Inc. has caused these
Articles Supplementary to be signed in its name and on its behalf this 16th day
of March , 1995.
THE CROWLEY PORTFOLIO GROUP, INC.
By: /s/ Robert A. Crowley
Robert A. Crowley
President
ATTEST:
/s/ Frederick J. Crowley, Jr.
Secretary
<PAGE>
THE UNDERSIGNED, President of THE CROWLEY PORTFOLIO GROUP, INC., who
executed on behalf of the said Corporation the foregoing Articles Supplementary,
of which this instrument is made a part, hereby acknowledges, in the name of and
on behalf of said Corporation, said Articles Supplementary to be the corporate
act of said Corporation and further certifies that, to the best of his
knowledge, information and belief, the matters and facts set forth therein with
respect to the approval thereof are true in all material respects, under the
penalties of perjury.
/s/ Robert A. Crowley
Robert A. Crowley
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ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
THE CROWLEY PORTFOLIO GROUP, INC.
Pursuant to the provisions of the Maryland General Corporation Law, as
amended (the "GCL"), THE CROWLEY PORTFOLIO GROUP, INC., a Maryland corporation
registered as an open-end investment company under the Investment Company Act of
1940, having its principal office in Baltimore, Maryland (the "Corporation"),
hereby certifies to the State Department of Assessments and Taxation of Maryland
that:
FIRST: ARTICLE FIFTH of the Corporation's Articles of Incorporation, third
paragraph, second sentence is hereby amended so that the series of the
Corporation's Common Stock designated as "The Crowley Growth Portfolio" is
hereby renamed as "The Crowley Growth and Income Portfolio."
SECOND: The entire Board of Directors of the Corporation on November 1,
1995 unanimously approved the foregoing amendment.
THIRD: The foregoing amendment is limited to a change expressly permitted
by Section 2-605(4) of the GCL to be made without action by stockholders.
IN WITNESS WHEREOF, The Crowley Portfolio Group, Inc. has caused these
Articles of Amendment to be signed by its President and attested by its
Secretary on March 7, 1996.
Attest: THE CROWLEY PORTFOLIO GROUP, INC.
/s/ Frederick J. Crowley, Jr. By:/s/ Robert A. Crowley
Frederick J. Crowley, Jr. Robert A. Crowley
Secretary President
THE UNDERSIGNED, President of THE CROWLEY PORTFOLIO GROUP, INC., who
executed on behalf of said corporation the foregoing Articles of Amendment, of
which this certificate is made a part, hereby acknowledges, in the name and on
behalf of said corporation, the foregoing Articles of Amendment to be the
corporate act of said corporation and further certifies that, to the best of his
knowledge, information and belief, the matters and facts set forth therein with
respect to the approval thereof are true in all material respects, under the
penalties of perjury.
/s/ Robert A. Crowley
Robert A. Crowley
President
THE CROWLEY PORTFOLIO GROUP, INC.
BYLAWS
ARTICLE I
OFFICES
Section 1. The principal office of the Corporation shall be in the City of
Baltimore, State of Maryland. The Corporation shall also have offices at such
other places as the Board of Directors may from time to time determine or the
business of the Corporation may require.
ARTICLE II
STOCKHOLDERS AND STOCK CERTIFICATES
Section 1. Every stockholder of record shall be entitled to a stock
certificate representing the shares owned by him. Stock certificates shall be in
such form as may be required by law and as the Board of Directors shall
prescribe. Every stock certificate shall be signed by the Chairman or the
President or a vice President and by the Treasurer or an Assistant Treasurer, or
the Secretary or an Assistant Secretary, and sealed with the corporate seal,
which may be a facsimile, either engraved or printed. Stock certificates may
bear the facsimile signatures of the officers authorized to sign such
certificates.
Section 2. Shares of the capital stock of the Corporation shall be
transferable only on the books of the
<PAGE>
Corporation by the person in whose name such shares are registered, or by his
duly authorized attorney or representative. In all cases of transfer by an
attorney-in-fact, the original power of attorney, or an official copy thereof
duly certified, shall be deposited and remain with the Corporation or its duly
authorized transfer agent. In case of transfers by executors, administrators,
guardians or other legal representatives, duly authenticated evidence of their
authority shall be produced, and may be required to be deposited and remain with
the Corporation or its duly authorized transfer agent. No transfer shall be made
unless and until the certificate issued to the transferor shall be delivered to
the Corporation or its duly authorized transfer agent, properly endorsed.
Section 3. Any person desiring a certificate for shares of the capital stock of
the Corporation to be issued in lieu of one lost or destroyed shall make an
affidavit or affirmation setting forth the loss or destruction of such stock
certificate, and shall advertise such loss or destruction in such manner as the
Board of Directors may require, and shall, if the Board of Directors shall so
require, give the Corporation a bond or indemnity, in such for and with such
security as may be satisfactory to the Board, indemnifying the Corporation
against any loss that may result upon the issuance of a new stock certificate.
Upon receipt of such affidavit and proof of publication of the advertisement of
such loss or destruction, and
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the bond, if any, required by the Board of Directors, a new stock certificate
may be issued of the same tenor and for the number of shares as the one alleged
to have been lost or destroyed.
Section 4. The Corporation shall be entitled to treat the holder of record
of any share or shares of its capital stock as the owner thereof and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or not
the Corporation shall have express or other notice thereof.
ARTICLE III
MEETINGS OF STOCKHOLDERS
Section 1. An annual meeting of the stockholders of the Corporation for the
election of directors and for the transaction of general business need not be
held in any year in which none of the following are required to be acted on by
stockholders under the Investment Company Act of 1940: (i) election of
directors; (ii) approval of an Investment Advisory Agreement; (iii) ratification
of the selection of independent public accountants; and (iv) approval of a
Distribution Agreement. Any annual meeting called for these or other purposes
shall be held at the principal office of the Corporation, or at such other place
within or without the State of Maryland as the Board of Directors may from time
to time prescribe.
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<PAGE>
Section 2. Special meetings of the stockholders may be called at any time
by the Chairman, President or a majority of the members of the Board of
Directors and shall be called by the Secretary upon the written request of the
holders of at least twenty-five percent of the shares of the capital stock of
the Corporation issued and outstanding and entitled to vote at such meeting;
provided, if the matter proposed to be acted on is substantially the same as a
matter voted on at any special meeting held during the preceding twelve months,
such written request shall be made by holders of at least a majority of the
capital stock of the Corporation issued and outstanding and entitled to vote at
such meetings. Upon receipt of a written request from such holders entitled to
call a special meeting, which shall state the purpose of the meeting and the
matter proposed to be acted on at it, the Secretary shall inform the holders who
made such request of the reasonably estimated cost of preparing and mailing a
notice of a meeting and upon payment of such costs to the Corporation the
Secretary shall issue notice of such meeting. Special meetings of the
stockholders shall be held at the principal office of the Corporation, or at
such other place within or without the State of Maryland as the Board of
Directors may from time to time direct, or at such place within or without the
State of Maryland as shall be specified in the notice of such meeting.
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<PAGE>
Section 3. Notice of the time and place of the annual or any special
meeting of the stockholders shall be given to each stockholder entitled to
notice of such meeting not less than ten days nor more than ninety days prior to
the date of such meeting. In the case of special meetings of the stockholders,
the notice shall specify the object or objects of such meeting, and no business
shall be transacted at such meeting other than that mentioned in the call.
Section 4. The Board of Directors may close the stock transfer books of the
Corporation for a period not exceeding twenty days preceding the date of any
meeting of stockholders, or the date for payment of any dividend, or the date
for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, or for a period of not exceeding
twenty days in connection with the obtaining of the consent of stockholders for
any purpose; provided, however, that in lieu of closing the stock transfer books
as aforesaid, the Board of Directors may fix in advance a date, not exceeding
ninety days preceding the date of any meeting of stockholders, or the date for
payment of any dividend, or the date for the allotment of rights, or the date
when any change or conversion or exchange of capital stock shall go into effect,
or a date in connection with obtaining such consent, as a record date for the
determination of the stockholders entitled to notice of, and to vote at any such
meeting and any adjournment thereof, or entitled
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<PAGE>
to receive payment of any such dividend, or to any such allotment of rights, or
to exercise the rights in respect of any such change, conversion or exchange of
capital stock or to give such consent, and in such case such stockholders and
only such stockholders as shall be stockholders of record on the date so fixed
shall be entitled to such notice of, and to vote at, such meeting and any
adjournment thereof, or to receive payment of such dividend or to receive such
allotment of rights or to exercise such rights, or to give such consent, as the
case may be, notwithstanding any transfer of any stock on the books of the
Corporation after any such record date fixed as aforesaid.
Section 5. At all meetings of the stockholders a quorum shall consist of
the holders of a majority of the outstanding shares of the capital stock of the
Corporation entitled to vote at such meeting. In the absence of a quorum no
business shall be transacted except that the stockholders present in person or
by proxy and entitled to vote at such meeting shall have power to adjourn the
meeting from time to time to a date not more than one hundred twenty days after
the original record date without further notice other than announcement at the
meeting. At any such adjourned meeting at which a quorum shall be present any
business may be transacted which might have been transacted at the meeting on
the date specified in the original notice. If a quorum is present at any
meeting, the holders of a majority of the shares o capital stock of the
Corporation issued and
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<PAGE>
outstanding and entitled to vote at the meeting who shall be present in person
or by proxy at such meeting shall have power to approve any matter properly
before the meeting, except a plurality of all votes cast at a meeting at which a
quorum is present shall be sufficient for the election of a director. The
holders of such majority shall also have power to adjourn the meeting to any
specific time or times, and no notice of any such adjourned meeting need be
given to stockholders absent or otherwise.
Section 6. At any meeting of the stockholders of the Corporation every
stockholder having the right to vote shall be entitled, in person or by proxy
appointed by an instrument in writing subscribed by such stockholder and bearing
a date not more than eleven months prior to said meeting unless such instrument
provides for a longer period, to one vote for each share of stock having voting
power registered in his name on the books of the Corporation.
ARTICLE IV
DIRECTORS
Section 1. The Board of Directors shall consist of not less than three nor
more than twelve members. The Board of Directors may by a vote of the entire
board increase or decrease the number of directors without a vote of the
stockholders; provided, that any such decrease shall not affect the tenure of
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office of any director. Directors need not hold any shares of the capital stock
of the Corporation.
Section 2. Subject to the provisions of Article III, Section 1 of these
Bylaws, the directors shall be elected by the stockholders of the Corporation at
an annual meeting, if held, or at a special meeting called for such purposes,
and shall hold office until their successors shall be duly elected and shall
qualify.
Section 3. The Board of Directors shall have the control and management of
the business of the Corporation, and in addition to the powers and authority by
these Bylaws expressly conferred upon them, may exercise, subject to the
provisions of the laws of the State of Maryland and of the Articles of
Incorporation of the Corporation, all such powers of the Corporation and do all
such acts and things as are not required by law or by the Articles of
Incorporation to be exercised or done by the stockholders.
Section 4. The Board of Directors shall have power to fill vacancies
occurring on the Board, whether by death, resignation or otherwise. A vacancy on
the Board of Directors resulting from any cause except an increase in the number
of directors may be filled by a vote of the majority of the remaining members of
the Board, though less than a quorum. A
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<PAGE>
vacancy on the Board of Directors resulting from an increase in the number of
directors may be filled by a majority of the entire Board of Directors. A
director elected by the Board of Directors to fill a vacancy shall serve until
the next annual meeting of stockholders and until his successor is elected and
qualifies. If less than a majority of the directors in office shall have been
elected by the stockholders, a meeting of the stockholders shall be called as
required under the Investment Company Act of 1940, as amended.
Section 5. The Board of Directors shall have power to appoint, and at its
discretion to remove or suspend, any officers, managers, superintendents,
subordinates, assistants, clerks, agents and employees, permanently or
temporarily, as the Board may think fit, and to determine their duties and to
fix, and from time to time to change, their salaries or emoluments, and to
require security in such instances and in such amounts as it may deem proper.
Section 6. In case of the absence of an officer of the Corporation, or for
any other reason which may seem sufficient to the Board of Directors, the Board
may delegate his powers and duties for the time being to any other officer of
the Corporation or to any director.
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<PAGE>
Section 7. The Board of Directors may, by resolution or resolutions passed
by a majority of the whole Board, designate one or more committees, each
committee to consist of two or more of the directors of the Corporation which,
to the extent provided in such resolution or resolutions and by applicable law,
shall have and may exercise the powers of the Board of Directors in the
management of the business and affairs of the Corporation. Such committee or
committees shall have such name or names as may be determined from time to time
by resolution adopted by the Board of Directors. Any such committee shall keep
regular minutes of its proceedings, and shall report the same to the Board when
required.
Section 8. The Board of Directors may hold their meetings and keep the
books of the Corporation, except the original or a duplicate stock ledger and
the original or a certified copy of these Bylaws, outside of the State of
Maryland, at such place or places as they may from time to time determine.
Section 9. The Board of Directors shall have power to fix, and from time to
time to change the compensation, if any, of the directors of the Corporation.
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<PAGE>
ARTICLE V
DIRECTORS MEETINGS
Section 1. Regular meetings of the Board of Directors shall be held without
notice at such times and places as may be from time to time prescribed by the
Board.
Section 2. Special meetings of the Board of Directors may be called at any
time by the Chairman, and shall be called by the Chairman upon the written
request of a majority of the members of the Board of Directors. Unless notice is
waived by all the members of the Board of Directors, notice of any special
meeting shall be given to each director at least twenty-four hours prior to the
date of such meeting, and such notice shall provide the time and place of such
special meeting.
Section 3. One-third of the entire Board of Directors shall constitute a
quorum for the transaction of business at any meeting; except that if the number
of directors on the Board is less than six, two members shall constitute a
quorum for the transaction of business at any meeting. The act of a majority of
the directors present at any meeting where there is a quorum shall be the act of
the Board of Directors except as may be otherwise required by Maryland law or
the Investment Company Act of 1940.
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<PAGE>
Section 4. The order of business at meetings of the Board of Directors
shall be prescribed from time to time by the Board.
ARTICLE VI
OFFICERS AND AGENTS
Section 1. The Board shall elect one or more persons to serve as Chairman,
President and Chief Executive officer, one or more Vice Presidents, a Secretary
and a Treasurer and may elect or appoint one or more Assistant Secretaries, one
or more Assistant Treasurers, and such other officers and agents as the Board
may deem necessary and as the business of the Corporation may require.
Section 2. The Chairman of the Board and the President shall be elected
from the membership of the Board of Directors, but other officers need not be
members of the Board of Directors. Any two or more offices may be held by the
same person except the offices of President and Vice President. All officers of
the Corporation shall serve for one year and until their successors shall have
been duly elected and shall have qualified; provided, however, that any officer
may be removed at any time, either with or without cause, by action by the Board
of Directors.
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ARTICLE VII
DUTIES OF OFFICERS
CHAIRMAN OF THE BOARD
Section 1. The Chairman of the Board shall preside at all meetings of the
stockholders and the Board of Directors and shall be a member ex officio of all
standing committees. He shall have those duties and responsibilities as shall be
assigned to him by the Board of Directors. In the absence, resignation,
disability or death of the President, the Chairman shall exercise all the powers
and perform all the duties of the President until his return, or until such
disability shall be removed or until a new President shall have been elected.
PRESIDENT
Section 2. The President shall be the Chief Executive Officer of the
Corporation, and in the recess of the Board of Directors shall have the general
control and management of its business and affairs, subject, however to the
regulations of the Board of Directors.
The President shall, in the absence of the Chairman, preside at all
meetings of the stockholders and the Board of Directors. In the event of the
absence, resignation, disability or death of the Chairman, the President shall
exercise all powers and perform all duties of the Chairman until his return, or
until such disability shall have been removed or until a new Chairman shall have
been elected.
-13-
<PAGE>
VICE PRESIDENT
Section 3. The Vice President shall have those duties and responsibilities
as shall be assigned to him by the Chairman or the President. In the event of
the absence, resignation, disability or death of the Chairman and President, the
vice President shall exercise all the powers and perform all the duties of the
President until his return, or until such disability shall be removed or until a
new President shall have been elected. If the Board appoints more than one vice
President, the duties of such Vice Presidents shall be as designated by the
Board.
THE SECRETARY AND ASSISTANT SECRETARIES
Section 4. The Secretary shall attend all meetings of the stockholders and
shall record all the proceedings thereof in a book to be kept for that purpose,
and he shall be the custodian of the corporate seal of the Corporation. In the
absence of the Secretary, an Assistant Secretary or any other person appointed
or elected by the Board of Directors, as is elsewhere in these Bylaws provided,
may exercise the rights and perform the duties of the Secretary.
Section 5. The Assistant Secretary, or, if there be more than one Assistant
Secretary, then the Assistant Secretaries in the order of their seniority,
shall, in the absence or disability of the Secretary, perform the duties and
exercise the powers of
-14-
<PAGE>
the secretary. Any Assistant Secretary elected by the Board shall also perform
such other duties and exercise such other powers as the Board of Directors shall
from time to time prescribe.
THE TREASURER AND ASSISTANT TREASURERS
Section 6. The Treasurer shall keep full and correct accounts of the
receipts and expenditures of the Corporation in books belonging to the
Corporation, and shall deposit all monies and valuable effects in the name and
to the credit of the Corporation and in such depositories as may be designated
by the Board of Directors, and shall, if the Board shall so direct, give bond
with sufficient security and in such amount as may be required by the Board of
Directors for the faithful performance of his duties.
He shall disburse funds of the Corporation as may be ordered by the Board
of Directors, taking proper vouchers for such disbursements, and shall render to
the President and Board of Directors at the regular meetings of the Board, or
whenever they may require it, an account of all his transactions as the chief
fiscal officer of the Corporation and of the financial condition of the
Corporation, and shall present each year before the annual meeting of the
stockholders a full financial report of the preceding fiscal year.
Section 7. The Assistant Treasurer, or, if there be more than one Assistant
Treasurer, then the Assistant Treasurers in
-15-
<PAGE>
the order of their seniority, shall, in the absence or disability of the
Treasurer, perform the duties and exercise the powers of the Treasurer. Any
Assistant Treasurer elected by the board shall also perform such duties and
exercise such powers as the Board of Directors shall from time to time
prescribe.
ARTICLE VIII
CHECKS, DRAFTS, NOTES, ETC.
Section 1. All checks shall bear the signature of such person or persons as
the Board of Directors may from time to time direct.
Section 2. All notes and other similar obligations and acceptances of
drafts by the Corporation shall be signed by such person or persons as the Board
of Directors may from time to time direct.
Section 3. Any officer of the Corporation or any other employee, as the
Board of Directors may from time to time direct, shall have full power to
endorse for deposit all checks and all negotiable paper drawn payable to his or
their order or to the order of the Corporation.
ARTICLE IX
CORPORATE SEAL
Section 1. The corporate seal of the Corporation shall have inscribed
thereon the name of the Corporation, the year of its organization, and the words
"Corporate Seal, Maryland." Such
-16-
<PAGE>
seal may be used by causing it or a facsimile thereof to be impressed or affixed
or otherwise reproduced.
ARTICLE X
DIVIDENDS
Section 1. Dividends upon the shares of the capital stock of the
Corporation may, subject to the provisions of the Articles of Incorporation of
the Corporation, if any, be declared by the Board of Directors at any regular or
special meeting, pursuant to law. Dividends may be paid in cash, in property, or
in shares of the capital stock of the Corporation.
Section 2. Before payment of any dividend there may be set aside out of any
funds of the Corporation available for dividends such sum or sums as the Board
of Directors may, from time to time, in their absolute discretion, think proper
as a reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for such other
purpose as the Board of Directors shall deem to be for the best interests of the
Corporation, and the Board of Directors may abolish any such reserve in the
manner in which it was created.
ARTICLE XI
FISCAL YEAR
Section 1. The fiscal year of the Corporation shall be determined by
resolution of the Board of Directors.
-17-
<PAGE>
ARTICLE XII
NOTICES Section 1. Whenever under the provisions of these Bylaws notice is
required to be given to any director or stockholder, such notice is deemed given
when it is personally delivered, left at the residence or usual place of
business of the director or stockholder, or mailed to such director or
stockholder at such address as shall appear on the books of the Corporation and
such notice, if mailed, shall be deemed to be given at the time it shall be so
deposited in the United States mail postage prepaid. In the case of directors,
such notice may also be given orally by telephone or by telegraph or cable.
Section 2. Any notice required to be given under these Bylaws may be waived
in writing, signed by the person or persons entitled to such notice, whether
before or after the time stated therein.
-18-
<PAGE>
ARTICLE XIII
AMENDMENTS
Section 1. These Bylaws may be amended, altered or repealed by the
affirmative vote of the holders of a majority of the shares of capital stock of
the Corporation issued and outstanding and entitled to vote thereon, or by a
majority of the Board of Directors, as the case may be.
-19-
INCORPORATED UNDER THE LAWS OF MARYLAND
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
The Crowley Growth and Income Portfolio
Common Stock Par Value $0.01 Per Share
CUSIP
COM
This Certifies that ___________________________________ is the registered
holder of ______________________ Shares
transferable only on the books of the Corporation by the holder hereof in person
or by Attorney upon surrender of this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be hereunto
affixed this _________ day of ________________ A.D. 19_____
_______________________________ ___________________________
Secretary President
Registered and Countersigned
By___________________________
Authorized Person
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
<PAGE>
The Crowley Portfolio Group, Inc.
The Fund will furnish without charge to each
shareholder upon request, a full statement of the
designations and any preferences, conversion or
other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and
terms and conditions of redemption of the shares
which the Fund is authorized to issue. Such
request may be made in writing to The Fund at its
offices in Wilmington, Delaware.
DEMAND FOR REDEMPTION
THE UNDERSIGNED SHAREHOLDER hereby surrenders to the Corporation this
certificate and the shares evidenced thereby and demands redemption in
accordance with the provisions of Article 7th of the Articles of Incorporation
and as described in the Prospectus.
____________________________, 19___ _________________________________
Date Shareholder
_________________________________
Witness
THE SHAREHOLDER SHOULD REFER TO THE PROSPECTUS
FOR SIGNATURE GUARANTEE REQUIREMENTS.
ASSIGNMENT
For Value Received, ________ hereby sell, assign and transfer unto
_____________________________________________________________ Shares represented
by the within Certificate, and do hereby irrevocably constitute and appoint
_______________________________________________________________ Attorney to
transfer the said Shares on the books of the within named Corporation with full
power of substitution in the premises.
Dated ________________________ 19____
In the presence of ____________________________________
_________________________________
NOTICE. THE SIGNATURE OF THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE
OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
INCORPORATED UNDER THE LAWS OF MARYLAND
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
The Crowley Income Portfolio
Common Stock Par Value $0.01 Per Share
CUSIP
COM
This Certifies that ___________________________________ is the registered
holder of ______________________ Shares
transferable only on the books of the Corporation by the holder hereof in person
or by Attorney upon surrender of this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be hereunto
affixed this _________ day of ________________ A.D. 19_____
_______________________________ ___________________________
Secretary President
Registered and Countersigned
By___________________________
Authorized Person
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Registered and Countersigned
By___________________________
Authorized Person
<PAGE>
The Crowley Portfolio Group, Inc.
The Fund will furnish without charge to each
shareholder upon request, a full statement of the
designations and any preferences, conversion or
other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and
terms and conditions of redemption of the shares
which the Fund is authorized to issue. Such
request may be made in writing to The Fund at its
offices in Wilmington, Delaware.
DEMAND FOR REDEMPTION
THE UNDERSIGNED SHAREHOLDER hereby surrenders to the Corporation this
certificate and the shares evidenced thereby and demands redemption in
accordance with the provisions of Article 7th of the Articles of Incorporation
and as described in the Prospectus.
____________________________, 19___ _________________________________
Date Shareholder
_________________________________
Witness
THE SHAREHOLDER SHOULD REFER TO THE PROSPECTUS
FOR SIGNATURE GUARANTEE REQUIREMENTS.
ASSIGNMENT
For Value Received, ________ hereby sell, assign and transfer unto
_____________________________________________________________ Shares represented
by the within Certificate, and do hereby irrevocably constitute and appoint
_______________________________________________________________ Attorney to
transfer the said Shares on the books of the within named Corporation with full
power of substitution in the premises.
Dated ________________________ 19____
In the presence of ____________________________________
_________________________________
NOTICE. THE SIGNATURE OF THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE
OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
INCORPORATED UNDER THE LAWS OF MARYLAND
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
The Crowley Diversified Management Portfolio
Common Stock Par Value $0.01 Per Share
CUSIP
COM
This Certifies that ___________________________________ is the registered
holder of ______________________ Shares
transferable only on the books of the Corporation by the holder hereof in person
or by Attorney upon surrender of this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be hereunto
affixed this _________ day of ________________ A.D. 19_____
_______________________________ ___________________________
Secretary President
Registered and Countersigned
By___________________________
Authorized Person
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Registered and Countersigned
By___________________________
Authorized Person
<PAGE>
The Crowley Portfolio Group, Inc.
The Fund will furnish without charge to each
shareholder upon request, a full statement of the
designations and any preferences, conversion or
other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and
terms and conditions of redemption of the shares
which the Fund is authorized to issue. Such
request may be made in writing to The Fund at its
offices in Wilmington, Delaware.
DEMAND FOR REDEMPTION
THE UNDERSIGNED SHAREHOLDER hereby surrenders to the Corporation this
certificate and the shares evidenced thereby and demands redemption in
accordance with the provisions of Article 7th of the Articles of Incorporation
and as described in the Prospectus.
____________________________, 19___ _________________________________
Date Shareholder
_________________________________
Witness
THE SHAREHOLDER SHOULD REFER TO THE PROSPECTUS
FOR SIGNATURE GUARANTEE REQUIREMENTS.
ASSIGNMENT
For Value Received, ________ hereby sell, assign and transfer unto
_____________________________________________________________ Shares represented
by the within Certificate, and do hereby irrevocably constitute and appoint
_______________________________________________________________ Attorney to
transfer the said Shares on the books of the within named Corporation with full
power of substitution in the premises.
Dated ________________________ 19____
In the presence of ____________________________________
_________________________________
NOTICE. THE SIGNATURE OF THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE
OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
EXHIBIT 24(b)(5)(a)
MANAGEMENT CONTRACT
THE CROWLEY PORTFOLIO GROUP, INC.
THE CROWLEY GROWTH PORTFOLIO
AGREEMENT, made as of December 6, 1989 between THE CROWLEY PORTFOLIO GROUP,
INC., a Maryland corporation (herein called the "Fund") and CROWLEY & CROWLEY
CORP., a Delaware corporation (the Advisor").
WHEREAS, the Fund is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Fund desires to retain the Advisor to furnish investment
advisory and administrative services to the Fund and the Advisor is willing to
furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment.
The Fund hereby appoints the Advisor to act as investment advisor and
administrator to The Crowley Growth Portfolio ("Portfolio") of the Fund for the
period and on the terms set forth in this Agreement. The Advisor accepts such
appointment and agrees to furnish the services herein set forth for the
compensation herein provided.
2. Services of the Advisor.
Subject to the supervision of the Fund's Board of Directors, the
Advisor shall provide a continuous investment program for the Portfolio,
including investment research and management with respect to all securities and
investments and cash equivalents in said Portfolio. The Advisor shall determine
from time to time what securities and other investments will be purchased,
retained or sold by the Fund with respect to such Portfolio. The Advisor will
provide the services under this Agreement in accordance with the Portfolio's
investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information, as from time to time
amended, and resolutions of the Fund's Board of Directors. The Advisor further
agrees that in connection with its services hereunder it:
(a) will, at its own expense, place all orders for the purchase and
sale of all portfolio securities for the account of the Portfolio with brokers
or dealers selected by the Advisor. In selecting brokers or dealers the Advisor
shall use its best efforts to seek on behalf of the Fund and the Portfolio the
best overall terms available. In assessing the best overall terms available for
any transaction, the Advisor
<PAGE>
shall consider all factors it deems relevant, including the breadth of the
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a continuing basis.
Subject to the foregoing requirements, the Advisor may also place transactions
with brokers and dealers which has sold shares of the Portfolio. In evaluating
the best overall terms available, and in selecting the broker or dealer to
execute a particular transaction, the Advisor may also consider the "brokerage"
and "research" services provided to the Portfolio and/or other accounts over
which the Advisor exercises investment discretion. The Advisor is authorized to
pay to a broker or dealer who provides brokerage and/or research services a
commission for executing a portfolio transaction for the Portfolio which is in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction if the Advisor determines in good faith that such
commission was reasonable in relation to the value of the brokerage and/or
research services provided by such broker or dealer, viewed in terms of the that
particular transaction or in terms of the overall responsibilities of the
Advisor to the Portfolio and other investment accounts as to which the Advisor
exercises investment discretion; and
(b) will provide office space for the Fund, at the Advisor's principal
place of business or such other location as the Fund shall reasonably approve.
(c) To the extent it receives the necessary information from the Fund
or its agents by Written or Oral Instructions, the Advisor shall maintain and
keep current the following Accounts and Records relating to the business of the
Portfolio, in such form as may be mutually agreed to between the Fund and the
Advisor:
(1) Cash Receipts Journal
(2) Cash Disbursements Journal
(3) Dividends Paid Record
(4) Purchase and Sales Journals - Portfolio Securities
(5) Subscription and Redemption Journals
(6) Security Ledgers
(7) Broker Ledger
(8) General Ledger
(9) Daily Expense Accruals
(10) Daily Interest Accruals
(11) Securities and Monies borrowed or loaned and
collateral therefore
(12) Daily Trial Balance
(13) Investment Income Journal
Unless necessary information to perform the above functions is furnished by
Written or Oral Instructions to the Advisor daily prior to 4:00 PM Eastern time
(the close of trading on the New York Stock Exchange) and the calculation of the
Portfolio's net asset value, as provided below, the Advisor shall incur no
liability, and the Fund shall indemnify and hold harmless the Advisor from and
against any liability arising from any
-2-
<PAGE>
failure to provide complete information or from any discrepancy between the
information received by the Advisor and used in such calculations and any
subsequent information received from the Fund or any of its designated agents.
It shall be the responsibility of the Fund to furnish or cause to be furnished
to the Advisor, the declaration, record, payment dates and amounts of any
dividends or income and any other special actions required on or concerning each
of its portfolio securities.
(d) The Advisor shall perform the ministerial calculations necessary
to calculate the Portfolio's net asset value daily, in accordance with the
Portfolio's current prospectus and utilizing the information described in this
Section. Portfolio items for which market quotations are available by the
Advisor's use of an automated financial information service shall be based on
the closing prices quoted on such service except where the Fund has given or
caused to be given specific Written or Oral Instructions to utilize a different
value. All of the portfolio securities shall be given such values as the Fund
provides by Written or Oral Instructions including all foreign securities,
restricted securities and other securities requiring valuation not readily
ascertainable solely by use of an automated financial information service. The
Advisor shall have no responsibility or liability for the accuracy of prices
quoted by the automated financial information service; for the accuracy of the
information supplied by the Fund; or for any loss, liability, damage, or cost
arising out of any inaccuracy of such data. The Advisor shall have no
responsibility or duty to include information or valuations to be provided by
the Fund in any computation unless and until it is timely supplied to the
Advisor in usable form. Unless the necessary information to calculate the net
asset value daily is furnished by Written or Oral Instructions from the Fund,
the Advisor shall incur no liability, and the Fund shall indemnify and hold
harmless the Advisor from and against any liability arising from any failure to
provide complete information or from any discrepancy between the information
received by the Advisor and used in such calculation and any subsequent
information received from the Fund or any of its designated agents.
(e) At the end of each month, the Fund shall cause the Custodian to
forward to the Advisor a monthly statement of cash and portfolio transactions,
which will be reconciled with the Advisor's Accounts and Records maintained for
the Fund. The Advisor will report any discrepancies to the Custodian, and report
any unreconciled items to the Fund.
(f) The Advisor shall assist the Fund's independent auditors, or upon
approval of the Fund, or upon demand, any regulatory body, in any requested
review of the Fund's Accounts and Records but shall be reimbursed for all
expenses and employee time invested in any such review of the Fund's Accounts
and Records outside of routine and normal periodic reviews. Upon receipt from
the Fund of the necessary information, the Advisor shall supply the necessary
data for the Fund or accountant's completion of any necessary tax returns,
questionnaires, periodic reports
-3-
<PAGE>
to shareholders and such other reports and information requests as the Fund and
the Advisor shall agree upon from time to time.
(g) All financial data provided to, processed by, and reported by the
Advisor under this Agreement shall be stated in United States dollar or
currency. The Advisor shall have no obligation to convert to, equate, or deal in
foreign currencies or values, and expressly assumes no liability for any
currency conversion or equation computations relating to the affairs of the
Fund.
(h) Nothing contained in this Agreement is intended to or shall
require the Company, in any capacity hereunder, to perform any functions or
duties on any holiday, day of special observance or any other day on which the
Custodian or the New York Stock Exchange is closed. Functions or duties normally
scheduled to be performed on such days shall be performed on, and as of, the
next succeeding business day on which both the New York Stock Exchange and the
Custodian Bank are open. Notwithstanding the foregoing, the Advisor shall
compute the net asset value of the Portfolio on each day required pursuant to
Rule 22c-1 promulgated under the Investment Act of 1940.
3. Services Not Exclusive. The investment management services furnished by
the Advisor hereunder are not to be deemed exclusive and the Advisor shall be
free to furnish similar services to others.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Advisor hereby agrees that any records which it
maintains for the Fund are, and shall remain, the property of the Fund and
further agrees to surrender promptly to the Fund any of such records upon the
Fund's request. The Advisor further agrees to preserve any such records for the
period prescribed by Rule 31a-2 under the 1940 Act.
5. Expenses. During the term of this Agreement, the Fund will pay all of
its own operating expenses and costs including, without limitation, taxes,
interest, penalties, brokerage fees and commissions, directors' fees and
expenses, officers' and employees' compensation and fees (other than fees and
other compensation of directors, officers or employees who are affiliates of the
Advisor or any affiliate thereof), advisory fees, fees and charges of its
custodian and transfer and dividend disbursing agent, insurance premiums,
accounting, auditing and legal expenses, costs of maintenance of corporate
existence, costs of independent pricing services, costs of investor services,
including allocated telephone and personnel expenses, costs of preparing,
printing and distributing prospectuses and reports to shareholders, shareholders
and directors meetings, supplies and all other expenses of the Fund.
6. Compensation. For the services provided pursuant to this Agreement the
Fund will pay the Advisor a fee, computed daily and paid monthly (in arrears),
at an annual rate of 1.0% of the average monthly net assets of the Portfolio.
-4-
<PAGE>
7. Limitation of Liability. The Advisor shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Fund or the
Portfolio in connection with the performance of this Agreement, except losses
resulting from willful misfeasance, bad faith or gross negligence of the Advisor
or from the reckless disregard by the Advisor of its duties under this
Agreement.
8. Duration and Termination. This Agreement shall become effective on the
date hereof, provided that it shall have been approved by the Board of Directors
of the Fund and the shareholders of the Portfolio, in accordance with the
requirements of Sections 15(a) and 15(c) of the 1940 Act, and, unless sooner
terminated as provided herein, shall continue in effect until
Thereafter, this Agreement shall continue in effect for successive
periods of one year, provided that each such continuance is specifically
approved at least annually (a) by the vote of a majority of those members of the
Fund's Board of Directors who are not interested persons of any party to this
Agreement, cast in person at a meeting called for the purpose of voting on such
approval, and (b) by the Fund's Board of Directors, or by vote of a majority of
the outstanding voting securities of the Portfolio. Notwithstanding the
foregoing, this Agreement may be terminated at any time, without penalty, by the
Fund (by vote of the Fund's Board of Directors or by vote of a majority of the
outstanding voting securities of the Portfolio), or by the Advisor, on sixty
days' written notice. This Agreement will immediately terminate in the event of
its assignment. (As used in this Agreement, the terms "majority of the
outstanding voting securities," "interested persons" and "assignment" shall have
the meanings ascribed thereto in the 1940 Act.) In the event that this Agreement
terminates on a day other than the last day of a month, the fee payable to the
Advisor for such month shall be paid on a pro rata basis.
9. Corporate Name. The parties agree that the Advisor has a proprietary
interest in the name "Crowley", and the Fund agrees to promptly take any and all
necessary action to remove the name "Crowley" from its corporate name and from
the name of any of its Portfolios upon receipt of written request therefore from
the Advisor.
10. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit 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 this Agreement shall not be
affected thereby. This Agreement shall be governed by Delaware law.
IN WITNESS WHEREOF, the parties hereto have caused this
-5-
<PAGE>
instrument to be executed by their officers designated below as of the day and
year first above written.
THE CROWLEY PORTFOLIO GROUP, INC.
Attest:/s/ Frederick J. Crowley /s/ Robert A. Crowley, President
(Title)
CROWLEY & CROWLEY CORP.
Attest:/s/ Robert A. Crowley /s/ Frederick J. Crowley
(Title)
-6-
EXHIBIT 24(b)(5)(b)
MANAGEMENT CONTRACT
THE CROWLEY PORTFOLIO GROUP, INC.
THE CROWLEY INCOME PORTFOLIO
AGREEMENT made as of December 6, 1989 between THE CROWLEY PORTFOLIO GROUP,
INC., a Maryland corporation (herein called the "Fund") and CROWLEY & CROWLEY
CORP., a Delaware corporation (the "Advisor").
WHEREAS, the Fund is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940, as amended ("1940
Act"); and
WHEREAS, the Fund desires to retain the Advisor to furnish investment
advisory and administrative services to the Fund and the Advisor is willing to
furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment.
The Fund hereby appoints the Advisor to act as investment advisor and
administrator to The Crowley Income Portfolio ("Portfolio") of the Fund for the
period and on the terms set forth in this Agreement. The Advisor accepts such
appointment and agrees to furnish the services herein set forth for the
compensation herein provided.
2. Services of the Advisor.
Subject to the supervision of the Fund's Board of Directors, the
Advisor shall provide a continuous investment program for the Portfolio,
including investment research and management with respect to all securities and
investments and cash equivalents in said Portfolio. The Advisor shall determine
from time to time what securities and other investments will be purchased,
retained or sold by the Fund with respect to such Portfolio. The Advisor will
provide the services under this Agreement in accordance with the Portfolio's
investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information, as from time to time
amended, and resolutions of the Fund's Board of Directors. The Advisor further
agrees that in connection with its services hereunder it:
(a) will, at its own expense, place all order for the purchase and
sale of all portfolio securities for the account of the Portfolio with brokers
or dealers selected by the Advisor. In selecting brokers or dealers the Advisor
shall use its best efforts to seek on behalf of the Fund and the Portfolio the
best overall terms available. In
<PAGE>
assessing the best overall terms available for any transaction, the Advisor
shall consider all factors it deems relevant, including the breadth of the
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a continuing basis.
Subject to the foregoing requirements, the Advisor may also place transactions
with brokers and dealers which has sold shares of the Portfolio. In evaluating
the best overall terms available, and in selecting the broker or dealer to
execute a particular transaction, the Advisor may also consider the "brokerage"
and "research" services provided to the Portfolio and/or other accounts over
which the Advisor exercises investment discretion. The Advisor is authorized to
pay to a broker or dealer who provides brokerage and/or research services a
commission for executing a portfolio transaction for the Portfolio which is in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction if the Advisor determines in good faith that such
commission was reasonable in relation to the value of the brokerage and/or
research services provided by such broker or dealer, viewed in terms of that
particular transaction or in terms of the overall responsibilities of the
Advisor to the Portfolio and other investment accounts as to which the Advisor
exercises investment discretion; and
(b) will provide office space for the Fund, at the Advisor's principal
place of business or such other location as the Fund shall reasonably approve.
(c) To the extent it receives the necessary information from the Fund
or its agents by Written or Oral Instructions, the Advisor shall maintain and
keep current the following Accounts and Records relating to the business of the
Portfolio, in such form as may be mutually agreed to between the Fund and the
Advisor:
(1) Cash Receipts Journal
(2) Cash Disbursements Journal
(3) Dividends Paid Record
(4) Purchase and Sales Journals - Portfolio Securities
(5) Subscription and Redemption Journals
(6) Security Ledgers
(7) Broker Ledger
(8) General Ledger
(9) Daily Expense Accruals
(10) Daily Interest Accruals
(11) Securities and Monies borrowed or loaned and
collateral therefore
(12) Daily Trial Balance
(13) Investment Income Journal
Unless necessary information to perform the above functions is furnished by
Written or Oral Instructions to the Advisor daily prior to 4:00 PM Eastern time
(the close of trading on the New York Stock Exchange) and the calculation of the
Portfolio's net asset value, as provided below, the Advisor shall incur no
liability, and the Fund shall indemnify and hold
-2-
<PAGE>
harmless the Advisor from and against any liability arising from any failure to
provide complete information or from any discrepancy between the information
received by the Advisor and used in such calculations and any subsequent
information received by the Advisor and used in such calculations and any
subsequent information received from the Fund or any of its designated agents.
It shall be the responsibility of the Fund to furnish or cause to be furnished
to the Advisor, the declaration, record, payment dates and amounts of any
dividends or income and any other special actions required on or concerning each
of its portfolio securities.
(d) The Advisor shall perform the ministerial calculations necessary
to calculate the Portfolio's net asset value daily, in accordance with the
Portfolio's current prospectus and utilizing the information described in this
Section. Portfolio items for which market quotations are available by the
Advisor's use of an automated financial information service shall be based on
the closing prices quoted on such service except where the Fund has given or
caused to be given specific Written or Oral Instructions to utilize a different
value. All of the portfolio securities shall be given such values as the Fund
provides by Written or Oral Instructions including all foreign securities,
restricted securities and other securities requiring valuation not readily
ascertainable solely by use of an automated financial information service. The
Advisor shall have no responsibility or liability for the accuracy of prices
quoted by the automated financial information service; for the accuracy of the
information supplied by the Fund; or for any loss, liability, damage, or cost
arising out of any inaccuracy of such data. The Advisor shall have no
responsibility or duty to include information or valuations to be provided by
the Fund in any computation unless and until it is timely supplied to the
Advisor in usable form. Unless the necessary information to calculate the net
asset value daily is furnished by Written or Oral Instructions from the Fund,
the Advisor shall incur no liability, and the Fund shall indemnify and hold
harmless the Advisor from and against any liability arising from any failure to
provide complete information or from any discrepancy between the information
received by the Advisor and used in such calculation and any subsequent
information received from the Fund or any of its designated agents.
(e) At the end of each month, the Fund shall cause the Custodian to
forward to the Advisor a monthly statement of cash and portfolio transactions,
which will be reconciled with the Advisor's Accounts and Records maintained for
the Fund. The Advisor will report any discrepancies to the Custodian, and report
any unreconciled items to the Fund.
(f) The Advisor shall assist the Fund's independent auditors, or upon
approval of the Fund, or upon demand, any regulatory body, in any requested
review of the Fund's Accounts and Records but shall be reimbursed for all
expenses and employee time invested in any such review of the Fund's Accounts
and Records outside of routine and normal periodic reviews. Upon receipt from
the Fund of the necessary information,
-3-
<PAGE>
the Advisor shall supply the necessary data for the Fund or accountant's
completion of any necessary tax returns, questionnaires, periodic reports to
shareholders and such other reports and information requests as the Fund and the
Advisor shall agree upon from time to time.
(g) All financial data provided to, processed by, and reported by the
Advisor under this Agreement shall be stated in United States dollar or
currency. The Advisor shall have no obligation to convert to, equate, or deal in
foreign currencies or values, and expressly assumes no liability for any
currency conversion or equation computations relating to the affairs of the
Fund.
(h) Nothing contained in this Agreement is intended to or shall
require the Company, in any capacity hereunder, to perform any functions or
duties on any holiday, day of special observance or any other day on which the
Custodian or the New York Stock Exchange is closed. Functions or duties normally
scheduled to be performed on such days shall be performed on, and as of, the
next succeeding business day on which both the New York Stock Exchange and the
Custodian Bank are open. Notwithstanding the foregoing, the Advisor shall
compute the net asset value of the Portfolio on each day required pursuant to
Rule 22c-1 promulgated under the Investment Act of 1940.
3. Services Not Exclusive. The investment management services furnished by
the Advisor hereunder are not to be deemed exclusive and the Advisor shall be
free to furnish similar services to others.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Advisor hereby agrees that any records which it
maintains for the Fund are, and shall remain, the property of the Fund and
further agrees to surrender promptly to the Fund and further agrees to surrender
promptly to the Fund any of such records upon the Fund's request. The Advisor
further agrees to preserve any such records for the period prescribed by Rule
21a-2 under the 1940 Act.
5. Expenses. During the term of this Agreement, the Fund will pay all of
its own operating expenses and costs including, without limitation, taxes,
interest, penalties, brokerage fees and commissions, directors' fees and
expenses, officers' and employees' compensation and fees (other than fees and
other compensation of directors, officers or employees who are affiliates of the
Advisor or any affiliate thereof), advisory fees, fees and charges of its
custodian and transfer and dividend disbursing agent, insurance premiums,
accounting, auditing and legal expenses, costs of maintenance of corporate
existence, costs of independent pricing services, costs of investor services,
including allocated telephone and personnel expenses, costs of preparing,
printing and distributing prospectuses and reports to shareholders, shareholders
and directors meetings, supplies and all other expenses of the Fund.
6. Compensation. For the services provided pursuant to this Agreement the
Fund will pay the Advisor a fee, computed daily and paid
-4-
<PAGE>
monthly (in arrears), at an annual rate of .60% of the average monthly net
assets of the Portfolio.
7. Limitation of Liability. The Advisor shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Fund or the
Portfolio in connection with the performance of this Agreement, except losses
resulting from willful misfeasance, bad faith or gross negligence of the Advisor
or from the reckless disregard by the Advisor of its duties under this
Agreement.
8. Duration and Termination. This Agreement shall become effective on the
date hereof, provided that it shall have been approved by the Board of Directors
of the Fund and the shareholders of the Portfolio, in accordance with the
requirements of Sections 15(a) and 15(c) of the 1940 Act, and, unless sooner
terminated as provided herein, shall continue in effect until
Thereafter, this Agreement shall continue in effect for successive periods
of one year, provided that each such continuance is specifically approved at
least annually (a) by the vote of a majority of those members of the Fund's
Board of Directors who are not interested persons of any party to this
Agreement, cast in person at a meeting called for the purpose of voting on such
approval, and (b) by the Fund's Board of Directors, or by vote of a majority of
the outstanding voting securities of the Portfolio. Notwithstanding the
foregoing, this Agreement may be terminated at any time, without penalty, by the
Fund (by vote of the Fund's Board of Directors or by vote of a majority of the
outstanding voting securities of the Portfolio), or by the Advisor, on sixty
days' written notice. This Agreement will immediately terminate in the event of
its assignment. (As used in this Agreement, the terms "majority of the
outstanding voting securities," "interested persons" and "assignment" shall have
the meanings ascribed thereto in the 1940 Act.) In the event that this Agreement
terminates on a day other than the last day of a month, the fee payable to the
Advisor for such month shall be paid on a pro rata basis.
9. Corporate Name. The parties agree that the Advisor has a proprietary
interest in the name "Crowley", and the Fund agrees to promptly take any and all
necessary action to remove the name "Crowley" from its corporate name and from
the name of any of its Portfolios upon receipt of written request therefore from
the Advisor.
10. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit 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 this Agreement shall not be
affected thereby. This Agreement shall be governed by Delaware law.
IN WITNESS WHEREOF, the parties hereto have caused this
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<PAGE>
instrument to be executed by their officers designated below as of the day and
year first above written.
THE CROWLEY PORTFOLIO GROUP, INC.
Attest:/s/ Frederick J. Crowley /s/ Robert A. Crowley, President
(Title)
CROWLEY & CROWLEY CORP.
Attest:/s/ Robert A. Crowley /s/ Frederick J. Crowley, Jr.
(Title)
-6-
MANAGEMENT CONTRACT
THE CROWLEY PORTFOLIO GROUP, INC.
THE CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO
AGREEMENT made as of March 31, 1995 between THE CROWLEY PORTFOLIO GROUP,
INC., a Maryland corporation (herein called the "Fund") and CROWLEY & CROWLEY
CORP., a Delaware corporation (the "Advisor").
WHEREAS, the Fund is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940, as amended ("1940
Act"); and
WHEREAS, the Fund desires to retain the Advisor to furnish investment
advisory and administrative services to the Fund and the Advisor is willing to
furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment.
The Fund hereby appoints the Advisor to act as investment advisor and
administrator to The Crowley Diversified Management Portfolio ("Portfolio") of
the Fund for the period and on the terms set forth in this Agreement. The
Advisor accepts such appointment and agrees to furnish the services herein set
forth for the compensation herein provided.
2. Services of the Advisor.
Subject to the supervision of the Fund's Board of Directors, the Advisor
shall provide a continuous investment program for the portfolio, including
investment research and management with respect to all securities and
investments and cash equivalents in said Portfolio. The Advisor shall determine
from time to time what securities and other investments will be purchased,
retained or sold by the Fund with respect to such Portfolio. The Advisor will
provide the services under this Agreement in accordance with the portfolio's
investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information, as from time to time
amended, and resolutions of the Fund's Board of Directors. The Advisor further
agrees that in connection with its services hereunder it:
(a) will, at its own expense, place all orders for the purchase and
sale of all portfolio securities for the account of the Portfolio with brokers
or dealers selected by the Advisor. In selecting brokers or dealers the Advisor
shall use its best efforts to seek on behalf of the Fund and the Portfolio the
best overall terms available. In assessing the best overall terms available for
any transaction, the Advisor shall consider all factors it deems relevant,
including the breadth of the
<PAGE>
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a continuing basis.
Subject to the foregoing requirements, the Advisor may also place transactions
with brokers and dealers which have sold shares of the Portfolio. In evaluating
the best overall terms available, and in selecting the broker or dealer to
execute a particular transaction, the Advisor may also consider the "brokerage"
and "research" services provided to the Portfolio and/or other accounts over
which the Advisor exercises investment discretion. The Advisor is authorized to
pay to a broker or dealer who provides brokerage and/or research services a
commission for executing a portfolio transaction for the Portfolio which is in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction if the Advisor determines in good faith that such
commission was reasonable in relation to the value of the brokerage and/or
research services provided by such broker or dealer, viewed in terms of that
particular transaction or in terms of the overall responsibilities of the
Advisor to the Portfolio and other investment accounts as to which the Advisor
exercises investment discretion; and
(b) will provide office space for the Fund, at the Advisor's principal
place of business or such other location as the Fund shall reasonably approve.
(c) To the extent it receives the necessary information from the Fund
or its agents by Written or Oral Instructions, the Advisor shall maintain and
keep current the following Accounts and Records relating to the business of the
Portfolio, in such form as may be mutually agreed to between the Fund and the
Advisor:
(1) Cash Receipts Journal
(2) Cash Disbursements Journal
(3) Dividends Paid Record
(4) Purchase and Sales Journals - Portfolio Securities
(5) Subscription and Redemption Journals
(6) Security Ledgers
(7) Broker Ledger
(8) General Ledger
(9) Daily Expense Accruals
(10) Daily Interest Accruals
(11) Securities and Monies borrowed or loaned and
collateral therefore
(12) Daily Trial Balance
(13) Investment Income Journal
Unless necessary information to perform the above functions is furnished by
Written or Oral Instructions to the Advisor daily prior to 4:00 PM Eastern time
(the close of trading on the New York Stock Exchange) the Advisor shall incur no
liability, and the Fund shall indemnify and hold harmless the Advisor from and
against any liability arising from any failure to provide complete information
or from any discrepancy between the
-2-
<PAGE>
information received by the Advisor and any subsequent information received from
the Fund or any of its designated agents.
It shall be the responsibility of the Fund to furnish or cause to be furnished
to the Advisor, the declaration, record, payment dates and amounts of any
dividends or income and any other special actions required on or concerning each
of its portfolio securities.
(d) The Fund shall calculate the Portfolio's net asset value daily, in
accordance with the Portfolio's current prospectus.
(e) At the end of each month, the Fund shall cause the Custodian to
forward to the Advisor a monthly statement of cash and portfolio transactions,
which will be reconciled with the Advisor's Accounts and Records maintained for
the Fund. The Advisor will report any discrepancies to the Custodian, and report
any unreconciled items to the Fund.
(f) The Advisor shall assist the Fund's independent auditors, or upon
approval of the Fund, or upon demand, any regulatory body, in any requested
review of the Fund's Accounts and Records but shall be reimbursed for all
expenses and employee time invested in any such review of the Fund's Accounts
and Records outside of routine and normal periodic reviews. Upon receipt from
the Fund of the necessary information, the Advisor shall supply the necessary
data for the Fund or accountant's completion of any necessary tax returns,
questionnaires, periodic reports to shareholders and such other reports and
information requests as the Fund and the Advisor shall agree upon from time to
time.
(g) All financial data provided to, processed by, and reported by the
Advisor under this Agreement shall be stated in United States dollar or
currency. The Advisor shall have no obligation to convert to, equate, or deal in
foreign currencies or values, and expressly assumes no liability for any
currency conversion or equation computations relating to the affairs of the
Fund.
(h) Nothing contained in this Agreement is intended to or shall
require the Company, in any capacity hereunder, to perform any functions or
duties on any holiday, day of special observance or any other day on which the
Custodian or the New York Stock Exchange is closed. Functions or duties normally
scheduled to be performed on such days shall be performed on, and as of, the
next succeeding business day on which both the New York Stock Exchange and the
Custodian Bank are open.
3. Services Not Exclusive. The investment management services furnished by
the Advisor hereunder are not to be deemed exclusive and the Advisor shall be
free to furnish similar services to others.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Advisor hereby agrees that any records which it
maintains for the Fund are, and shall remain, the property of the Fund and
further agrees to surrender promptly to the Fund any of such
-3-
<PAGE>
records upon the Fund's request. The Advisor further agrees to preserve any such
records for the period prescribed by Rule 31a-2 under the 1940 Act.
5. Expenses. During the term of this Agreement, the Fund will pay all of
its own operating expenses and costs including, without limitation, taxes,
interest, penalties, brokerage fees and commissions, directors' fees and
expenses, officers' and employees' compensation and fees (other than fees and
other compensation of directors, officers or employees who are affiliates of the
Advisor or any affiliate thereof), advisory fees, fees and charges of its
custodian and transfer and dividend disbursing agent, insurance premiums,
accounting, auditing and legal expenses, costs of maintenance of corporate
existence, costs of independent pricing services, costs of investor services,
including allocated telephone and personnel expenses, costs of preparing,
printing and distributing prospectuses and reports to shareholders, shareholders
and directors meetings, supplies and all other expenses of the Fund.
6. Compensation. For the services provided pursuant to this Agreement the
Fund will pay the Advisor a fee, computed daily and paid monthly (in arrears),
at an annual rate of 1.0% of the average monthly net assets of the Portfolio.
7. Limitation of Liability. The Advisor shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Fund or the
Portfolio in connection with the performance of this Agreement, except losses
resulting from willful misfeasance, bad faith or gross negligence of the Advisor
or from the reckless disregard by the Advisor of its duties under this
Agreement.
8. Duration and Termination. This Agreement shall become effective on the
date hereof, provided that it shall have been approved by the Board of Directors
of the Fund and the shareholders of the Portfolio, in accordance with the
requirements of Sections 15(a) and 15(c) of the 1940 Act, and, unless sooner
terminated as provided herein, shall continue in effect until March 31, 1997.
Thereafter, this Agreement shall continue in effect for successive periods of
one year, provided that each such continuance is specifically approved at least
annually (a) by the vote of a majority of those members of the Fund's Board of
Directors who are not interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval, and (b)
by the Fund's Board of Directors, or by vote of a majority of the outstanding
voting securities of the Portfolio. Notwithstanding the foregoing, this
Agreement may be terminated at any time, without penalty, by the Fund (by vote
of the Fund's Board of Directors or by vote of a majority of the outstanding
voting securities of the Portfolio), or by the Advisor, on sixty days' written
notice. This Agreement will immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the
meanings ascribed thereto in the 1940 Act.) In the event that this Agreement
terminates on a day other than the last day
-4-
<PAGE>
of a month, the fee payable to the Advisor for such month shall be paid on a pro
rata basis.
9. Corporate Name. The parties agree that the Advisor has a proprietary
interest in the name "Crowley", and the Fund agrees to promptly take any and all
necessary action to remove the name "Crowley" from its corporate name and from
the name of any of its Portfolios upon receipt of written request therefore from
the Advisor.
10. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit 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 this Agreement shall not be
affected thereby. This Agreement shall be governed by Delaware law.
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.
THE CROWLEY PORTFOLIO GROUP, INC.
Attest: /s/ Frederick J. Crowley, Jr. /s/ Robert A. Crowley, President
(Title)
CROWLEY & CROWLEY CORP.
Attest: /s/ Robert A. Crowley /s/ Frederick J. Crowley, Jr.
(Title)
-5-
DISTRIBUTION AGREEMENT
BETWEEN
THE CROWLEY PORTFOLIO GROUP, INC.
AND
CROWLEY SECURITIES
THIS AGREEMENT entered into the 6th day of December, 1989, by and between
THE CROWLEY PORTFOLIO GROUP, INC., a Maryland corporation with an office located
at 1813 Marsh Road, Suite H, Wilmington, Delaware 19810 (the "Corporation") for
The Crowley Growth Portfolio (the "Fund"), and CROWLEY SECURITIES, a Delaware
partnership, with its principal office located at 1813 Marsh Road, Suite H,
Wilmington, Delaware 19810 (the "Distributor").
W I T N E S S E T H:
In consideration of the mutual covenants and agreements of the parties
hereto, the parties intending to be bound, mutually covenant and agree with each
other as follows:
1. The Corporation, on behalf of the Fund, hereby appoints the Distributor
as agent of the Fund to effect the sale and public distribution of shares of the
capital stock of the Fund. This appointment is made by the Corporation for the
Fund and accepted by the Distributor upon the understanding that the
distribution of shares of the Fund to the public be effected by the Distributor
or through various securities dealers, either individuals or organizations, but
that it shall be done in such manner that the Fund shall be under no
responsibility or liability to any person whatsoever on account of the acts and
statements of any such individual or organization. The Distributor shall have
the sole right to select the security dealers to whom shares will be offered by
it and, subject to express provisions of this Agreement, applicable securities
laws, the Corporation's Articles of Incorporation and the Bylaws and the then
current prospectus of the Fund, to determine the terms and prices in any
contract for the sale of shares to any dealer made by it as such agent for the
Fund.
2. The Distributor shall be the exclusive agent for the Fund for the sale
of its shares and the Fund agrees that it will not sell any shares to any person
except to fill orders for the shares received though the Distributor; provided,
however, that the foregoing exclusive right shall not apply: (a) to shares
issued or sold in connection with the merger or consolidation of any other
investment company with the Fund or the acquisition by purchase or otherwise of
all or substantially all the assets of
<PAGE>
any investment company or substantially all the outstanding shares of any such
company by the Fund; (b) to shares which may be offered by the Fund to its
stockholders for reinvestment of cash distributed from capital gains or net
investment income of the Fund; or (c) to shares which may be issued to
shareholders of other Funds who exercise any exchange privilege set forth in the
Fund's prospectus.
3. The Distributor shall have the right to sell the shares of the Fund's
capital stock to dealers, as needed (making reasonable allowance for clerical
errors and errors of transmission), but not more than the shares needed to fill
unconditional orders for shares placed with the Distributor by dealers. In every
case the Distributor shall charge the public offering price and the Fund shall
receive the net asset value for the shares sold, determined as provided in
paragraph 4 hereof. The Distributor shall notify the Fund at the close of each
business day (normally 5:00 pm., New York city time), of the number of shares
sold during each day. Notwithstanding the foregoing, the Fund may sell its
shares to certain affiliated persons at net asset value, as described in the
prospectus.
4. The public offering price consists of the net asset value per share,
unless otherwise stated in the Fund's currently effective prospectus. The net
asset value of shares of the Fund shall be determined by the Fund or the Fund's
custodian, or such officer or officers or other persons as the Board of
Directors of the Corporation may designate. The determination shall be made once
a day on which the New York Stock Exchange is open for a full business day and
in accordance with the method set out in the Bylaws of the Corporation and the
current prospectus of the Fund.
5. The Distributor agrees that it will not sell any shares of the Fund to
any officer, director, or partner of either the Distributor or of the
Corporation or any firm or corporation which may be employed by the Fund or by
the Distributor except for investment purposes only and where the purchaser
agrees not to resell the securities to anyone except the Fund. The Distributor
further agrees that it will promptly advise the secretary of the Corporation of
all sales of shares of the Fund to, or purchase of shares of the Fund from, any
such person.
6. The Distributor agrees that it will not for its own account purchase any
shares of the Fund except for investment purposes and that it will not for its
own account sell any such shares excepting only those shares which it may own at
the time of executing this Agreement and any shares resulting from the
reinvestment of dividends paid on those shares, and the Distributor will not
sell other shares except by redemption of such shares by the Fund.
-2-
<PAGE>
7. (a) On behalf of the Fund the Corporation appoints and designates the
Distributor as agent of the Fund and the Distributor accepts such appointment as
such agent, to repurchase shares of the Fund in accordance with the provisions
of the Articles of Incorporation and Bylaws of the Corporation.
(b) In connection with such redemptions or repurchases the Corporation
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the Investment Company Act of 1940 and as set forth in the
Corporation's Bylaws and then current prospectus of the Fund.
(c) The authority of the Distributor under this paragraph 7 may, with
the consent of the Corporation, be redelegated in whole or in part to another
person or firm.
(d) The authority granted in this paragraph 7 may be suspended by the
Corporation at any time or from time to time pursuant to the provisions of its
Articles of Incorporation until further notice to the Distributor. The president
or any Vice president of the Corporation shall have the power granted by said
provisions. After any such suspension the authority granted to the Distributor
by this paragraph 7 shall be reinstated only by a written instrument executed on
behalf of the Fund by the Corporation's President or any Vice President.
8. The Fund agrees that it will cooperate with the Distributor to prepare,
execute and file applications for registration and qualification of its shares
for sale under the laws of the United States and the provisions and regulations
of the U.S. Securities and Exchange Commission and under the Securities Acts of
such States and in such amounts as the Fund may determine, and shall pay
registration fees in connection therewith. The Distributor shall bear all
expenses incident to the sale of shares of the Fund, including without
limitation, the cost of any sales material or literature, the cost of copies of
the prospectus used as sales material (except those being sent to existing
shareholders) and the cost of any reports or proxy material prepared for the
Fund's stockholders to the extent that such material is used in connection with
the sale of shares of the Fund.
9. For its services under this Agreement, the Distributor shall be entitled
to receive a selling commission which reflects a maximum of 3.00% of the amount
invested by a purchaser of the Fund's shares, or as may otherwise be stated in
the Fund's currently effective prospectus. The Distributor may make payments to
others from such amounts in accordance with any selling dealer agreement in
effect.
-3-
<PAGE>
10. Notwithstanding anything contained herein to the contrary, shares of
the Fund may be offered for sale at a price other than their current net asset
value or regular public offering price, if such reduction or elimination is
authorized by an order of the Securities and Exchange Commission, or the
Investment Company Act of 1940 or the rules and regulations promulgated
thereunder provide for such variation. Furthermore, such shares may be offered
and sold directly by the Fund rather than by the Distributor as otherwise
provided in this Agreement.
11. This Agreement shall become effective December 6, 1989 and shall
continue in effect for a period of more than one year from its effective date
only as long as such continuance is approved, at least annually, by the Board of
Directors of the Corporation, including a majority of those Directors who are
not "interested persons" of any party to this Agreement voting in person at a
meeting called for the purpose of voting on such approval. This Agreement may be
terminated by either party hereto upon thirty (30) days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
assignment by the Distributor (as the term "assignment" is defined by the
Investment Company Act of 1940, as amended) unless the United States Securities
and Exchange Commission has issued an order exempting the Fund and the
Distributor from the provisions of the Investment Company Act of 1940, as
amended, which would otherwise have effected the termination of this Agreement.
12. No amendment to this Agreement shall be executed or become effective
unless its terms have been approved (a) by a majority of the directors of the
Corporation or by the vote of a majority of the outstanding voting securities of
the Fund, and (b) by a majority of those directors who are not interested
persons of the Fund or of any party to this Agreement.
13. The Corporation, on behalf of the Fund, and the Distributor hereby each
agree that all literature and publicity issued by either of them referring
directly or indirectly to the Fund or to the Distributor shall be submitted to
and receive the approval of the Fund and the Distributor before the same may be
used by either party.
14. The Distributor agrees to use its best efforts in effecting the sale
and public distribution of the shares of the Fund through dealers and to perform
its duties in redeeming and repurchasing the shares of the Fund, but nothing
contained in this Agreement shall make the Distributor or any of its officers
and directors or shareholders liable for any loss sustained by the Fund or any
of the Corporation's officers, directors or shareholders, or by any other person
on account of any act done or omitted to be done by the Distributor under this
Agreement provided that nothing herein contained shall protect the
-4-
<PAGE>
Distributor against any liability to the Fund or to any of its shareholders to
which the Distributor would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of its duties as
Distributor or by reason of its reckless disregard of its obligations or duties
as Distributor under this Agreement. Nothing in this Agreement shall protect the
Distributor from any liabilities which it may have under the Securities Act of
1933 or the Investment Company Act of 1940.
15. As used in this Agreement the terms "interested persons," "assignment;"
and "majority of the outstanding voting securities" shall have the respective
meanings specified in the Investment Company Act of 1940 as now in effect.
IN WITNESS WHEREOF, THE CROWLEY PORTFOLIO GROUP, INC., for THE CROWLEY
GROWTH PORTFOLIO, AND CROWLEY SECURITIES, have caused this Agreement to be
signed by their duly authorized officers and their corporate seals to be
hereunto duly affixed all on the day and year above written.
Attest: THE CROWLEY PORTFOLIO GROUP, INC.
/s/ Robert A. Crowley /s/ Robert A. Crowley
Secretary President
Attest: CROWLEY SECURITIES
/s/ Frederick J. Crowley, Jr. /s/ Frederick J. Crowley, Jr.
Secretary General Partner
-5-
DISTRIBUTION AGREEMENT
BETWEEN
THE CROWLEY PORTFOLIO GROUP, INC.
AND
CROWLEY SECURITIES
THIS AGREEMENT entered into the 6th day of December, 1989, by and between
THE CROWLEY PORTFOLIO GROUP, INC., a Maryland corporation with an office located
at 1813 Marsh Road, Suite H, Wilmington, Delaware 19810 (the "Corporation") for
The Crowley Income Portfolio (the "Fund"), and CROWLEY SECURITIES, a Delaware
partnership, with its principal office located at 1813 Marsh Road, Suite H,
Wilmington, Delaware 19810 (the "Distributor").
W I T N E S S E T H:
In consideration of the mutual covenants and agreements of the parties
hereto, the parties intending to be bound, mutually covenant and agree with each
other as follows:
1. The Corporation, on behalf of the Fund, hereby appoints the Distributor
as agent of the Fund to effect the sale and public distribution of shares of the
capital stock of the Fund. This appointment is made by the Corporation for the
Fund and accepted by the Distributor upon the understanding that the
distribution of shares of the Fund to the public be effected by the Distributor
or through various securities dealers, either individuals or organizations, but
that it shall be done in such manner that the Fund shall be under no
responsibility or liability to any person whatsoever on account of the acts and
statements of any such individual or organization. The Distributor shall have
the sole right to select the security dealers to whom shares will be offered by
it and, subject to express provisions of this Agreement, applicable securities
laws, the Corporation's Articles of Incorporation and the Bylaws and the then
current prospectus of the Fund, to determine the terms and prices in any
contract for the sale of shares to any dealer made by it as such agent for the
Fund.
2. The Distributor shall be the exclusive agent for the Fund for the sale
of its shares and the Fund agrees that it will not sell any shares to any person
except to fill orders for the shares received though the Distributor; provided,
however, that the foregoing exclusive right shall not apply: (a) to shares
issued or sold in connection with the merger or consolidation of any other
investment company with the Fund or the acquisition by purchase or otherwise of
all or substantially all the assets of
<PAGE>
any investment company or substantially all the outstanding shares of any such
company by the Fund; (b) to shares which may be offered by the Fund to its
stockholders for reinvestment of cash distributed from capital gains or net
investment income of the Fund; or (c) to shares which may be issued to
shareholders of other Funds who exercise any exchange privilege set forth in the
Fund's prospectus.
3. The Distributor shall have the right to sell the shares of the Fund's
capital stock to dealers, as needed (making reasonable allowance for clerical
errors and errors of transmission), but not more than the shares needed to fill
unconditional orders for shares placed with the Distributor by dealers. In every
case the Distributor shall charge the public offering price and the Fund shall
receive the net asset value for the shares sold, determined as provided in
paragraph 4 hereof. The Distributor shall notify the Fund at the close of each
business day (normally 5:00 pm., New York city time), of the number of shares
sold during each day. Notwithstanding the foregoing, the Fund may sell its
shares to certain affiliated persons at net asset value, as described in the
prospectus.
4. The public offering price consists of the net asset value per share,
unless otherwise stated in the Fund's currently effective prospectus. The net
asset value of shares of the Fund shall be determined by the Fund or the Fund's
custodian, or such officer or officers or other persons as the Board of
Directors of the Corporation may designate. The determination shall be made once
a day on which the New York Stock Exchange is open for a full business day and
in accordance with the method set out in the Bylaws of the Corporation and the
current prospectus of the Fund.
5. The Distributor agrees that it will not sell any shares of the Fund to
any officer, director, or partner of either the Distributor or of the
Corporation or any firm or corporation which may be employed by the Fund or by
the Distributor except for investment purposes only and where the purchaser
agrees not to resell the securities to anyone except the Fund. The Distributor
further agrees that it will promptly advise the secretary of the Corporation of
all sales of shares of the Fund to, or purchase of shares of the Fund from, any
such person.
6. The Distributor agrees that it will not for its own account purchase any
shares of the Fund except for investment purposes and that it will not for its
own account sell any such shares excepting only those shares which it may own at
the time of executing this Agreement and any shares resulting from the
reinvestment of dividends paid on those shares, and the Distributor will not
sell other shares except by redemption of such shares by the Fund.
-2-
<PAGE>
7. (a) On behalf of the Fund the Corporation appoints and designates the
Distributor as agent of the Fund and the Distributor accepts such appointment as
such agent, to repurchase shares of the Fund in accordance with the provisions
of the Articles of Incorporation and Bylaws of the Corporation.
(b) In connection with such redemptions or repurchases the Corporation
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the Investment Company Act of 1940 and as set forth in the
Corporation's Bylaws and then current prospectus of the Fund.
(c) The authority of the Distributor under this paragraph 7 may, with
the consent of the Corporation, be redelegated in whole or in part to another
person or firm.
(d) The authority granted in this paragraph 7 may be suspended by the
Corporation at any time or from time to time pursuant to the provisions of its
Articles of Incorporation until further notice to the Distributor. The president
or any Vice president of the Corporation shall have the power granted by said
provisions. After any such suspension the authority granted to the Distributor
by this paragraph 7 shall be reinstated only by a written instrument executed on
behalf of the Fund by the Corporation's President or any Vice President.
8. The Fund agrees that it will cooperate with the Distributor to prepare,
execute and file applications for registration and qualification of its shares
for sale under the laws of the United States and the provisions and regulations
of the U.S. Securities and Exchange Commission and under the Securities Acts of
such States and in such amounts as the Fund may determine, and shall pay
registration fees in connection therewith. The Distributor shall bear all
expenses incident to the sale of shares of the Fund, including without
limitation, the cost of any sales material or literature, the cost of copies of
the prospectus used as sales material (except those being sent to existing
shareholders) and the cost of any reports or proxy material prepared for the
Fund's stockholders to the extent that such material is used in connection with
the sale of shares of the Fund.
9. For its services under this Agreement, the Distributor shall be entitled
to receive a selling commission which reflects a maximum of 3.00% of the amount
invested by a purchaser of the Fund's shares, or as may otherwise be stated in
the Fund's currently effective prospectus. The Distributor may make payments to
others from such amounts in accordance with any selling dealer agreement in
effect.
-3-
<PAGE>
10. Notwithstanding anything contained herein to the contrary, shares of
the Fund may be offered for sale at a price other than their current net asset
value or regular public offering price, if such reduction or elimination is
authorized by an order of the Securities and Exchange Commission, or the
Investment Company Act of 1940 or the rules and regulations promulgated
thereunder provide for such variation. Furthermore, such shares may be offered
and sold directly by the Fund rather than by the Distributor as otherwise
provided in this Agreement.
11. This Agreement shall become effective December 6, 1989 and shall
continue in effect for a period of more than one year from its effective date
only as long as such continuance is approved, at least annually, by the Board of
Directors of the Corporation, including a majority of those Directors who are
not "interested persons" of any party to this Agreement voting in person at a
meeting called for the purpose of voting on such approval. This Agreement may be
terminated by either party hereto upon thirty (30) days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
assignment by the Distributor (as the term "assignment" is defined by the
Investment Company Act of 1940, as amended) unless the United States Securities
and Exchange Commission has issued an order exempting the Fund and the
Distributor from the provisions of the Investment Company Act of 1940, as
amended, which would otherwise have effected the termination of this Agreement.
12. No amendment to this Agreement shall be executed or become effective
unless its terms have been approved (a) by a majority of the directors of the
Corporation or by the vote of a majority of the outstanding voting securities of
the Fund, and (b) by a majority of those directors who are not interested
persons of the Fund or of any party to this Agreement.
13. The Corporation, on behalf of the Fund, and the Distributor hereby each
agree that all literature and publicity issued by either of them referring
directly or indirectly to the Fund or to the Distributor shall be submitted to
and receive the approval of the Fund and the Distributor before the same may be
used by either party.
14. The Distributor agrees to use its best efforts in effecting the sale
and public distribution of the shares of the Fund through dealers and to perform
its duties in redeeming and repurchasing the shares of the Fund, but nothing
contained in this Agreement shall make the Distributor or any of its officers
and directors or shareholders liable for any loss sustained by the Fund or any
of the Corporation's officers, directors or shareholders, or by any other person
on account of any act done or omitted to be done by the Distributor under this
Agreement provided that nothing herein contained shall protect the
-4-
<PAGE>
Distributor against any liability to the Fund or to any of its shareholders to
which the Distributor would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of its duties as
Distributor or by reason of its reckless disregard of its obligations or duties
as Distributor under this Agreement. Nothing in this Agreement shall protect the
Distributor from any liabilities which it may have under the Securities Act of
1933 or the Investment Company Act of 1940.
15. As used in this Agreement the terms "interested persons," "assignment;"
and "majority of the outstanding voting securities" shall have the respective
meanings specified in the Investment Company Act of 1940 as now in effect.
IN WITNESS WHEREOF, THE CROWLEY PORTFOLIO GROUP, INC., for THE CROWLEY
INCOME PORTFOLIO, AND CROWLEY SECURITIES, have caused this Agreement to be
signed by their duly authorized officers and their corporate seals to be
hereunto duly affixed all on the day and year above written.
Attest: THE CROWLEY PORTFOLIO GROUP, INC.
/s/ Robert A. Crowley /s/ Robert A. Crowley
Secretary President
Attest: CROWLEY SECURITIES
/s/ Frederick J. Crowley, Jr. /s/ Frederick J. Crowley, Jr.
Secretary General Partner
-5-
DISTRIBUTION AGREEMENT
BETWEEN
THE CROWLEY PORTFOLIO GROUP, INC.
AND
CROWLEY SECURITIES
THIS AGREEMENT entered into the 31st day of March, 1995, by and between THE
CROWLEY PORTFOLIO GROUP, INC., a Maryland corporation with an office located at
1813 Marsh Road, Suite H, Wilmington, Delaware 19810 (the "Corporation") for The
Crowley Diversified Management Portfolio (the "Fund"), and CROWLEY SECURITIES, a
Delaware partnership, with its principal office located at 1813 Marsh Road,
Suite H, Wilmington, Delaware 19810 (the "Distributor").
W I T N E S S E T H:
In consideration of the mutual covenants and agreements of the parties
hereto, the parties intending to be bound, mutually covenant and agree with each
other as follows:
1. The Corporation, on behalf of the Fund, hereby appoints the Distributor
as agent of the Fund to effect the sale and public distribution of shares of the
capital stock of the Fund. This appointment is made by the Corporation for the
Fund and accepted by the Distributor upon the understanding that the
distribution of shares of the Fund to the public be effected by the Distributor
or through various securities dealers, either individuals or organizations, but
that it shall be done in such manner that the Fund shall be under no
responsibility or liability to any person whatsoever on account of the acts and
statements of any such individual or organization. The Distributor shall have
the sole right to select the security dealers to whom shares will be offered by
it and, subject to express provisions of this Agreement, applicable securities
laws, the Corporation's Articles of Incorporation and the Bylaws and the then
current prospectus of the Fund, to determine the terms and prices in any
contract for the sale of shares to any dealer made by it as such agent for the
Fund.
2. The Distributor shall be the exclusive agent for the Fund for the sale
of its shares and the Fund agrees that it will not sell any shares to any person
except to fill orders for the shares received though the Distributor; provided,
however, that the foregoing exclusive right shall not apply: (a) to shares
issued or sold in connection with the merger or consolidation of any other
investment company with the Fund or the acquisition by
<PAGE>
purchase or otherwise of all or substantially all the assets of any investment
company or substantially all the outstanding shares of any such company by the
Fund; (b) to shares which may be offered by the Fund to its stockholders for
reinvestment of cash distributed from capital gains or net investment income of
the Fund; or (c) to shares which may be issued to shareholders of other Funds
who exercise any exchange privilege set forth in the Fund's prospectus.
3. The Distributor shall have the right to sell the shares of the Fund's
capital stock to dealers, as needed (making reasonable allowance for clerical
errors and errors of transmission), but not more than the shares needed to fill
unconditional orders for shares placed with the Distributor by dealers. In every
case the Distributor shall charge the public offering price and the Fund shall
receive the net asset value for the shares sold, determined as provided in
paragraph 4 hereof. The Distributor shall notify the Fund at the close of each
business day (normally 5:00 pm., New York city time), of the number of shares
sold during each day. Notwithstanding the foregoing, the Fund may sell its
shares to certain affiliated persons at net asset value, as described in the
prospectus.
4. The public offering price consists of the net asset value per share,
unless otherwise stated in the Fund's currently effective prospectus. The net
asset value of shares of the Fund shall be determined by the Fund or the Fund's
custodian, or such officer or officers or other persons as the Board of
Directors of the Corporation may designate. The determination shall be made once
a day on which the New York Stock Exchange is open for a full business day and
in accordance with the method set out in the Bylaws of the Corporation and the
current prospectus of the Fund.
5. The Distributor agrees that it will not sell any shares of the Fund to
any officer, director, or partner of either the Distributor or of the
Corporation or any firm or corporation which may be employed by the Fund or by
the Distributor except for investment purposes only and where the purchaser
agrees not to resell the securities to anyone except the Fund. The Distributor
further agrees that it will promptly advise the secretary of the Corporation of
all sales of shares of the Fund to, or purchase of shares of the Fund from, any
such person.
6. The Distributor agrees that it will not for its own account purchase any
shares of the Fund except for investment purposes and that it will not for its
own account sell any such shares excepting only those shares which it may own at
the time of executing this Agreement and any shares resulting from the
reinvestment of dividends paid on those shares, and the Distributor will not
sell other shares except by redemption of such shares by the Fund.
-2-
<PAGE>
7. (a) On behalf of the Fund the Corporation appoints and designates the
Distributor as agent of the Fund and the Distributor accepts such appointment as
such agent, to repurchase shares of the Fund in accordance with the provisions
of the Articles of Incorporation and Bylaws of the Corporation.
(b) In connection with such redemptions or repurchases the Corporation
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the Investment Company Act of 1940 and as set forth in the
Corporation's Bylaws and then current prospectus of the Fund.
(c) The authority of the Distributor under this paragraph 7 may, with
the consent of the Corporaition, be redelegated in whole or in part to another
person or firm.
(d) The authority granted in this paragraph 7 may be suspended by the
Corporation at any time or from time to time pursuant to the provisions of its
Articles of Incorporation until further notice to the Distributor. The president
or any Vice president of the Corporation shall have the power granted by said
provisions. After any such suspension the authority granted to the Distributor
by this paragraph 7 shall be reinstated only by a written instrument executed on
behalf of the Fund by the Corporation's President or any Vice President.
8. The Fund agrees that it will cooperate with the Distributor to prepare,
execute and file applications for registration and qualification of its shares
for sale under the laws of the United States and the provisions and regulations
of the U.S. Securities and Exchange Commission and under the Securities Acts of
such States and in such amounts as the Fund may determine, and shall pay
registration fees in connection therewith. The Distributor shall bear all
expenses incident to the sale of shares of the Fund, including without
limitation, the cost of any sales material or literature, the cost of copies of
the prospectus used as sales material (except those being sent to existing
shareholders) and the cost of any reports or proxy material prepared for the
Fund's stockholders to the extent that such material is used in connection with
the sale of shares of the Fund.
9. For its services under this Agreement, the Distributor shall be entitled
to receive a selling commission which reflects a maximum of 3.00% of the amount
invested by a purchaser of the Fund's shares, or as may otherwise be stated in
the Fund's currently effective prospectus. The Distributor may make payments to
others from such amounts in accordance with any selling dealer agreement in
effect.
-3-
<PAGE>
10. Notwithstanding anything contained herein to the contrary, shares of
the Fund may be offered for sale at a price other than their current net asset
value or regular public offering price, if such reduction or elimination is
authorized by an order of the Securities and Exchange Commission, or the
Investment Company Act of 1940 or the rules and regulations promulgated
thereunder provide for such variation. Furthermore, such shares may be offered
and sold directly by the Fund rather than by the Distributor as otherwise
provided in this Agreement.
11. This Agreement shall become effective April 1, 1995 and shall continue
in effect for a period of more than one year from its effective date only as
long as such continuance is approved, at least annually, by the Board of
Directors of the Corporation, including a majority of those Directors who are
not "interested persons" of any party to this Agreement voting in person at a
meeting called for the purpose of voting on such approval. This Agreement may be
terminated by either party hereto upon thirty (30) days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
assignment by the Distributor (as the term "assignment" is defined by the
Investment Company Act of 1940, as amended) unless the United States Securities
and Exchange Commission has issued an order exempting the Fund and the
Distributor from the provisions of the Investment Company Act of 1940, as
amended, which would otherwise have effected the termination of this Agreement.
12. No amendment to this Agreement shall be executed or become effective
unless its terms have been approved (a) by a majority of the directors of the
Corporation or by the vote of a majority of the outstanding voting securities of
the Fund, and (b) by a majority of those directors who are not interested
persons of the Fund or of any party to this Agreement.
13. The Corporation, on behalf of the Fund, and the Distributor hereby each
agree that all literature and publicity issued by either of them referring
directly or indirectly to the Fund or to the Distributor shall be submitted to
and receive the approval of the Fund and the Distributor before the same may be
used by either party.
14. The Distributor agrees to use its best efforts in effecting the sale
and public distribution of the shares of the Fund through dealers and to perform
its duties in redeeming and repurchasing the shares of the Fund, but nothing
contained in this Agreement shall make the Distributor or any of its officers
and directors or shareholders liable for any loss sustained by the Fund or any
of the Corporation's officers, directors or shareholders, or by any other person
on account of any act done or omitted to be done by the Distributor under this
Agreement provided that nothing herein contained shall protect the Distributor
against any liability to the Fund or to any of its
-4-
<PAGE>
shareholders to which the Distributor would otherwise be subject by reason of
willful misfeasance, bad faith, or gross negligence in the performance of its
duties as Distributor or by reason of its reckless disregard of its obligations
or duties as Distributor under this Agreement. Nothing in this Agreement shall
protect the Distributor from any liabilities which it may have under the
Securities Act of 1933 or the Investment Company Act of 1940.
15. As used in this Agreement the terms "interested persons," "assignment;"
and "majority of the outstanding voting securities" shall have the respective
meanings specified in the Investment Company Act of 1940 as now in effect.
IN WITNESS WHEREOF, THE CROWLEY PORTFOLIO GROUP, INC., for THE CROWLEY
DIVERSIFIED MANAGEMENT PORTFOLIO, AND CROWLEY SECURITIES, have caused this
Agreement to be signed by their duly authorized officers and their corporate
seals to be hereunto duly affixed all on the day and year above written.
Attest: THE CROWLEY PORTFOLIO GROUP, INC.
/s/ Robert A. Crowley /s/ Robert A. Crowley
Secretary President
Attest: CROWLEY SECURITIES
/s/ Frederick J. Crowley, Jr. /s/ Frederick J. Crowley, Jr.
Secretary General Partner
-5-
EXHIBIT 24(b)(6)(d)
CROWLEY SECURITIES
Drummond Plaza Office Park
Suite 2101
Newark, Delaware 19711
SELLING DEALER AGREEMENT
Gentlemen:
Crowley Securities, principal underwriter of the capital stock of The
Crowley Portfolio Group, Inc. (hereinafter referred to as the "Fund"), cordially
invites you to become a member of the Selling Group which distributes the Fund's
shares. We base our offer of membership to you on our understanding that you are
a member of the National Association of Securities Dealers, Inc. and also on the
understanding that you agree to act in accordance with the following terms:
1) You and we agree to abide by Rule 26 of the rules of Fair Practice of
the National Association of Securities Dealers, Inc., and all other rules and
regulations that are now or may become applicable to transactions hereunder.
2) Orders for shares received from you and accepted by us will be executed
at the public offering price applicable to each order as established by the
prospectus of the Fund. The procedure relating to the handling of orders shall
be subject to instructions which we shall forward from time to time to all
members of the Selling Group. All orders are subject to acceptance by us and we
reserve the right in our sole discretion to reject any order.
3) At the time of sale, checks shall be made out to the Fund. The principal
underwriter of the Fund will rebate to you a concession equal to 80% of the
selling commission component of the public offering price in the following
manner:
Sales Reallowed
Amount of Purchase Load to Dealers
Less than $50,000 3.00% 2.40%
$50,000 but under $500,000 2.00% 1.60%
$500,000 but under $5,000,000 1.00% .80%
$5,000,000 and Over .50% .40%
4) As a member of the Selling Group, you agree to purchase shares only from
us as agent for the Fund or from your customers. Purchases from us shall be made
only for the purpose of covering purchase
<PAGE>
order already received from your customers (who may be any persons other than a
securities dealer or broker) or for your own bona fide investment. Purchases
from your customers shall be at a price not less than the net asset value next
calculated after receipt by us of a proper order.
5) You agree that you will not withhold placing customers' orders so as to
profit yourself as a result of such withholding.
6) You agree to sell shares only (a) to your customers at the public
offering price then applicable is accordance with the terms of the prospectus of
the Fund, or (b) to us as agent for the Fund or the Fund itself.
7) Settlements shall be made promptly, but in no case later than seven
business days after our acceptance of the order. If payment is not so received
or made, the right is reserved forthwith to cancel the sale or, at our option,
to resell the shares purchased at the then prevailing net asset value, in which
latter case you will agree to be responsible for any loss resulting to us from
your failure to make payment as aforesaid.
8) All sales will be subject to receipt of shares by us from the Fund. The
Fund and/or we reserve the right in our discretion without notice to you to
suspend sales or withdraw the offering of shares entirely, to change the
offering price as provided in the prospectus or to modify or cancel this
agreement, which shall be construed in accordance with the laws of the State of
Delaware.
9) No person is authorized to make any representations concerning the Funds
or their shares except those contained in the prospectus of the Fund and any
such information as may be released by the Fund as information supplemental to
the prospectus. In purchasing shares from us you shall rely solely on the
representations contained in the prospectus and supplemental information above
mentioned.
10) Additional copies of the prospectus and of any printed information
issued as supplemental literature to said documents will be supplied by us to
members of the Selling Group in reasonable quantities upon request.
11) In no transaction shall you have authority whatever to act as agent of
the Fund or of us or of any other member of the Selling Group, and nothing in
this agreement shall constitute either of us the agent of the other or shall
constitute you or the Fund the agent of the other. In all transactions in these
shares between you and us, you are acting as principal, or as agent for an
undisclosed principal, and we as agent for the Fund.
12) Shares sold to us (where certificates have been issued) shall be
delivered to, and all communications to us shall be sent to, Drummond Plaza
Office Park, Suite 2101, Newark, Delaware 19711. Any notice to you shall be duly
given if mailed or telegraphed to you at your address
-2-
<PAGE>
as registered from time to time with The National Association of Securities
Dealers, Inc.
CROWLEY SECURITIES
By:________________________________
Date____________________
===========================================================================
The undersigned accepts your invitation to become a member of the
Selling Group and agrees to abide by the foregoing terms and conditions. The
undersigned acknowledges receipt of The Crowley Portfolio Group, Inc.
prospectuses for use in connection with this offering.
Employer Identification No.: (Dealer)_____________________________________
__________________________ (Address)____________________________________
Date______________________ By___________________________________________
(Authorized Signature)
-3-
CUSTODIAN AGREEMENT WITH BANK
AGREEMENT
THIS AGREEMENT between THE CROWLEY PORTFOLIO GROUP, INC., a corporation
organized under the laws of the State of Maryland (hereinafter called the
"Fund"), and WILMINGTON TRUST COMPANY, a banking corporation organized under the
laws of the State of Delaware (hereinafter called "Custodian").
W I T N E S S E T H:
WHEREAS, the Fund desires that the securities and cash of its series, The
Crowley Growth Portfolio (hereinafter referred to as "Series") shall be
hereafter held and administered by Custodian pursuant to the terms of this
Agreement:
NOW THEREFORE, in consideration of the mutual agreements herein made, the
Fund and Custodian agree as follows:
Section 1. Definitions.
The word "securities" as used herein includes stocks, shares, bonds,
debentures, notes, mortgages or other obligations and any certificates,
receipts, warrants or other instruments representing rights to receive, purchase
or subscribe for the same, or evidencing or representing any other rights or
interests therein, or in any property or assets. The word "securities" as used
herein shall also include "book-entries" maintained by the Custodian in accord
with the provisions of Section 5A of this Agreement.
The words "officers' certificate" shall mean a request or direction or
certification in writing signed in the name of the Series by any two of the
following officers, the President, a Vice President, the Secretary and the
Treasurer of the Fund, or Assistant Vice President, Assistant Secretary or
Assistant Treasurer duly authorized to sign by the officers of the Fund (each
hereinafter called a "Qualified Officer").
Section 2. Names, Titles and Signatures of Officers.
An officer of the Fund will certify to WILMINGTON TRUST COMPANY the names
and signatures of those persons authorized to sign the officers' certificates
described in Section l hereof, together with any changes which may occur from
time to time.
<PAGE>
Section 3. Receipt and Disbursement of Money.
A. Custodian shall open and maintain a separate account or accounts in the
name of the Series, subject only to draft or order by WILMINGTON TRUST COMPANY
acting pursuant to the terms of this Agreement. WILMINGTON TRUST COMPANY shall
hold in such account or accounts, subject to the provisions hereof, all cash
received by it from or for the account of the Series. WILMINGTON TRUST COMPANY
shall make payments of cash to, or for the account of, the Series from such cash
only (a) for the purchase of securities for the portfolio of the Series upon the
delivery of such securities to WILMINGTON TRUST COMPANY, registered in the name
of the Series or of the nominee of WILMINGTON TRUST COMPANY referred to in
Section 7 or in proper form for transfer, (b) for the purchase or redemption of
shares of the capital stock of the SerieS upon delivery thereof to WILMINGTON
TRUST COMPANY, (c) for the payment of interest, dividends, taxes, management or
supervisory fees or operating expenses (including, without limitation thereto,
fees for legal, accounting and auditing services), (d) for payments in
connection with the conversion, exchange or surrender of securities owned or
subscribed to by the Series held by or to be delivered to WILMINGTON TRUST
COMPANY; or (e) for other proper purposes for the Series. Before making any such
payment, WILMINGTON TRUST COMPANY shall receive (and may rely upon) a telephone
call from a Qualified Officer followed by an officers' certificate requesting
such payment and stating that it is for a purpose permitted under the terms of
items (a), (b), (c) or (d) of this subsection A. With respect to item (e) of
this subsection, the Custodian shall also receive an officers' certificate and a
certified copy of a resolution of the officers of the Fund signed by an officer
of the Fund on behalf of the Series and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring such purpose to be a
proper corporate purpose, and naming the person or persons to whom such payment
is to be made.
B. Custodian is hereby authorized to endorse, and collect all checks,
drafts or other orders for the payment of money received by Custodian for the
account of the Series.
Section 4. Receipt of Securities.
Custodian shall hold in a separate account, and physically segregated at
all times from those of any other persons, firms or corporations, pursuant to
the provisions hereof, all securities received by it from or for the account of
the Series. All such securities are to be held or disposed of by Custodian for,
and subject at all times to the instructions of, the Fund on behalf of the
Series pursuant to the terms of this Agreement. The Custodian shall have no
power or authority to assign, hypothecate, pledge or otherwise dispose of any
such
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<PAGE>
securities and investments, except pursuant to the directive of the Fund and
only for the account of the Series as set forth in Section 5 of this Agreement.
Section 5. Transfer, Exchange, Redelivery, Etc. of Securities.
Custodian shall have sole power to release or deliver any securities of the
Series held by it pursuant to this Agreement. Custodian agrees to transfer,
exchange or deliver securities held by it hereunder only (a) for sales of such
securities for the account of the Series upon receipt by Custodian of payment
therefor, (b) when such securities are called, redeemed or retired or otherwise
become payable, (c) for examination by any broker selling any such securities in
accordance with "street delivery" custom, (d) in exchange for or upon conversion
into other securities alone or other securities and cash whether pursuant to any
plan of merger, consolidation, reorganization, recapitalization, or
readjustment, or otherwise, (e) upon conversion of such securities pursuant to
their terms into other securities, (f) upon exercise of subscription, purchase
or other similar rights represented by such securities for definitive
securities, (h) for the purpose of redeeming in kind shares of beneficial
interest of the Series upon delivery thereof to Custodian, or (i) for other
proper purposes for the Series. As to any deliveries made by Custodian pursuant
to items (b), (d), (e), (f) and (g), securities or cash receivable in exchange
therefor shall be deliverable to Custodian. Before making any such transfer,
exchange or delivery, Custodian shall receive (and may rely upon) an officers'
certificate requesting such transfer, exchange or delivery and stating that it
is for a purpose permitted under the terms of items (a), (b), (c), (d), (e),
(f), (g) or (h) of this Section 5. With respect to item (i), the Custodian shall
also receive an officers' certificate and a certified copy of a resolution of
the officers signed by an officer of the Fund on behalf of the Series and
certified by its Secretary or an Assistant Secretary, specifying the securities
to be delivered, setting forth the purpose for which such delivery is to be
made, declaring such purpose to be a proper corporate purpose, and naming the
person or persons to whom delivery of such securities shall be made.
A. Notwithstanding the provisions of Sections 3A, 4 and 5 of this
Agreement, the Custodian, upon terms and conditions set out in an officers'
certificate from the Fund on behalf of the Series, may either directly or
through one or more agents which are also qualified to act as custodians for
investment companies under the provisions of the Investment Company Act of 1940
and of this Agreement, both as amended to date, deposit all or any part of the
securities held hereunder in a clearing agency which acts as a securities
depository or use the book-entry system (as such entities are defined at 17 CFR
270.l7f-4(b)). So
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<PAGE>
long as any such deposit or system of record keeping is maintained for the
Series, the Custodian;
(1) shall deposit or record those securities that are so maintained
only in an account that is limited to assets held by it for customers;
(2) shall send the Fund a confirmation (i.e., an advice or notice of a
transaction) of any transfers to or from the account of the Series;
(3) shall, with respect to securities transferred to the account of
the Series and maintained in a securities depository or the book-entry system,
by book entry or otherwise, identify as belonging to the Series a quantity of
securities in a fungible bulk of securities (i) registered in the name of the
Custodian or its nominee, or (ii) shown on the Custodian's account on the books
of the clearing agency, the book-entry system, or the Custodian's agent;
(4) shall promptly send to the Fund reports it receives from the
appropriate Federal Reserve bank or clearing agency on its respective system of
internal accounting control; and
(5) shall send to the Fund such reports on the systems of internal
accounting control of the Custodian and its agents through which such securities
are deposited as are available and as the Fund may reasonably request from time
to time.
The Custodian may appoint one or more banking institutions which are
qualified to act as custodians for investment companies under the provisions of
the Investment Company Act of 1940 and of this Agreement, both as amended to
date, as a depository or as a subcustodian of any of the assets of the Series
subject to this Agreement upon terms and conditions approved in an officers'
certificate.
Section 6. Custodian's Acts Without Instructions.
Unless and until Custodian receives an officers' certificate to the
contrary, Custodian shall:
(a) Present for payment all coupons and other income items held by it
for the account of the Series which call for payment upon presentation and hold
the cash received by it upon such payment for the account of the Series;
(b) Collect interest and cash dividends received, with notice to the
Fund, to the account of the Series;
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<PAGE>
(c) Hold for the account of the Series hereunder all stock dividends,
rights and similar securities issued with respect to any securities held by it
hereunder;
(d) Execute as agent on behalf of the Series all necessary ownership
certificates required by the Internal Revenue Code or the income tax regulations
of the United States Treasury Department or under the laws of any state now or
hereafter in effect, inserting the Series' name on such certificates as the
owner of the securities covered thereby, to the extent it may lawfully do so.
Section 7. Registration of Securities.
Except as otherwise directed by an officers' certificate, Custodian shall
register all securities, except such as are in bearer form, in the name of a
registered nominee of Custodian as defined in the Internal Revenue Code and any
regulations of the Treasury Department issued thereunder or in any provision of
any subsequent Federal tax law exempting such transaction from liability for
stock transfer taxes, and shall execute and deliver all such certificates in
connection therewith as may be required by such laws or regulations or under the
laws of any state. Custodian shall use its best efforts to the end that the
specific securities held by it hereunder shall be at all times identifiable in
its records.
The Fund shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of its registered nominee, any securities which it
may hold for the account of the Series and which may from time to time be
registered in the name of the Series.
Section 8. Voting and Other Action.
Neither Custodian nor any nominee of Custodian shall vote any of the
securities held hereunder by or for the account of the Series except in
accordance with the instructions contained in an officers' certificate.
Custodian shall promptly deliver, or cause to be executed and delivered, to the
Fund all notices, proxies and proxy soliciting materials with relation to such
securities (if registered otherwise than in the name of the Series), but without
indicating the manner in which such proxies are to be voted.
Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of securities
and expirations of rights in connection therewith) received by Custodian from
issuers of the securities being held for the Series. With respect to tender or
exchange offers, Custodian shall transmit promptly to the Fund
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<PAGE>
all written information received by the Custodian from issuers of the securities
whose tender or exchange is sought and from the party (or his agents) making the
tender or exchange offer.
Section 9. Segregated Accounts for FCMs.
The Custodian may enter into separate custodial agreements with various
Futures Commission Merchants ("FCMs") which the Series uses (each an "FCM
agreement"), pursuant to which the Series margin deposits in certain
transactions involving futures contracts and options on futures contracts will
be held by the Custodian in accounts (each an "FCM account") subject to the
disposition by the FCM involved in such contracts in accordance with the
customer contract between FCM and the Fund on behalf of the Series ("FCM
contract"), Securities and Exchange Commission ("SEC") rules governing such
segregated accounts, Commodities Futures Trading Commission ("CFTC") rules and
the rules of applicable securities or commodities exchange. Such custodial
agreements shall only be entered into upon receipt of written instructions from
the Fund on behalf of the Series which state that (a) a customer agreement
between the FCM and the Fund on behalf of the Series has been entered into and
(b) the Fund is in compliance with all the rules and regulations of the CFTC.
Transfers of initial margin shall be made into an FCM account only upon written
instructions; transfers of premium and variation margin may be made into an FCM
account pursuant to oral instructions. Transfers of funds from an FCM account to
the FCM for which the Custodian holds such an account may only occur upon
certification by the FCM to the Custodian that pursuant to the FCM Agreement and
the FCM Contract, all conditions precedent to its right to give the Custodian
such instructions have been satisfied.
Section 10. Transfer Tax and Other Disbursements.
The Series shall pay or reimburse Custodian from time to time for any
transfer taxes payable upon transfers of securities made hereunder, and for all
other necessary and proper disbursements and expenses made or incurred by
Custodian in the performance of this Agreement.
Custodian shall execute and deliver such certificates in connection with
securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any regulations of the
Treasury Department issued thereunder, or under the laws of any state, to exempt
from taxation any exemptible transfers and/or deliveries of any such securities.
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<PAGE>
Section 11. Concerning Custodian.
Custodian shall be paid as compensation for its services pursuant to this
Agreement such compensation as may from time to time be agreed upon in writing
between the two parties.
Custodian shall not be liable for any action taken in good faith upon any
certificate herein described or certified copy of any resolution of the
officers, and may rely on the genuineness of any such document which it may in
good faith believe to have been validly executed.
The Fund on behalf of the Series agrees to indemnify and hold harmless
Custodian and its nominee from all taxes, charges, expenses, assessments, claims
and liabilities (including counsel fees) incurred or assessed against it or its
nominee in connection with the performance of this Agreement, except such as may
arise from its or its nominee's own negligent action, negligent failure to act
or willful misconduct. Custodian is authorized to charge any account of the
Series for such items. In the event of any advance of cash for any purposes made
by Custodian resulting from orders or instructions of the Fund on behalf of the
Series or in the event that Custodian or its nominee shall incur or be assessed
any taxes, charges, expenses, assessments, claims or liabilities in connection
with the performance of this Agreement, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the Series shall be security
therefor.
Section 12. Reports by Custodian.
Custodian shall furnish the Fund on behalf of the Series daily with a
statement of all transactions and entries for the account of the Series.
Custodian shall furnish the Fund on behalf of the Series at the end of every
month with a summary of all transactions. The books and records of Custodian
pertaining to its actions under this Agreement shall be open to inspection and
audit at reasonable times by officers of and auditors employed by the Fund on
behalf of the Series.
Section 13. Termination or Assignment.
This Agreement may be terminated by the Fund on behalf of the Series or by
Custodian on sixty days' notice given in writing and sent by registered or
certified mail to Custodian or to the Fund on behalf of the Series as the case
may be. In the event of termination hereof by the Fund on behalf of the Series
as aforesaid;
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<PAGE>
(a) Custodian shall deliver to the Fund on behalf of the Series on the
termination date a complete account of its transactions and activities
hereunder; and
(b) All securities, cash and other property being administered by
Custodian shall be delivered as directed by the Fund on behalf of the Series to
a successor Custodian immediately upon the effective date of termination of this
Agreement; or
(c) In the event of a vote of the shareholders of the Series to
dissolve or to function without a Custodian of its cash, securities and other
property (as evidenced by a certified copy of such resolution of shareholders
delivered to Custodian), Custodian shall deliver such cash, securities and other
property to, or upon the order of, the Fund on behalf of the Series immediately
upon the effective date of termination of this Agreement.
In the event that at the effective date of termination no successor
Custodian has been designated by the Fund on behalf of the Series and Custodian
has not been supplied with a certified copy of a resolution of shareholders of
the Series to dissolve or to function without a Custodian of its cash,
securities and other property, Custodian shall immediately deliver such in the
City of Wilmington, Delaware, to a Custodian of its own selection, having an
aggregate capital, surplus and undivided profits, as shown by its published
report, of not less than ten million dollars ($10,000,000) as a Custodian for
the Series, to be held under terms similar to those of this Agreement.
Dated this 29th day of November, 1989.
WILMINGTON TRUST COMPANY
Attest:/s/ By:/s/
THE CROWLEY PORTFOLIO GROUP, INC.
Attest:/s/ Catherine C. Crowley By:/s/ Robert A. Crowley
Robert A. Crowley
President
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CUSTODIAN AGREEMENT WITH BANK
AGREEMENT
THIS AGREEMENT between THE CROWLEY PORTFOLIO GROUP, INC., a corporation
organized under the laws of the State of Maryland (hereinafter called the
"Fund"), and WILMINGTON TRUST COMPANY, a banking corporation organized under the
laws of the State of Delaware (hereinafter called "Custodian").
W I T N E S S E T H:
WHEREAS, the Fund desires that the securities and cash of its series, The
Crowley Income Portfolio (hereinafter referred to as "Series") shall be
hereafter held and administered by Custodian pursuant to the terms of this
Agreement:
NOW THEREFORE, in consideration of the mutual agreements herein made, the
Fund and Custodian agree as follows:
Section 1. Definitions.
The word "securities" as used herein includes stocks, shares, bonds,
debentures, notes, mortgages or other obligations and any certificates,
receipts, warrants or other instruments representing rights to receive, purchase
or subscribe for the same, or evidencing or representing any other rights or
interests therein, or in any property or assets. The word "securities" as used
herein shall also include "book-entries" maintained by the Custodian in accord
with the provisions of Section 5A of this Agreement.
The words "officers' certificate" shall mean a request or direction or
certification in writing signed in the name of the Series by any two of the
following officers, the President, a Vice President, the Secretary and the
Treasurer of the Fund, or Assistant Vice President, Assistant Secretary or
Assistant Treasurer duly authorized to sign by the officers of the Fund (each
hereinafter called a "Qualified Officer").
Section 2. Names, Titles and Signatures of Officers.
An officer of the Fund will certify to WILMINGTON TRUST COMPANY the names
and signatures of those persons authorized to sign the officers' certificates
described in Section l hereof, together with any changes which may occur from
time to time.
<PAGE>
Section 3. Receipt and Disbursement of Money.
A. Custodian shall open and maintain a separate account or accounts in the
name of the Series, subject only to draft or order by WILMINGTON TRUST COMPANY
acting pursuant to the terms of this Agreement. WILMINGTON TRUST COMPANY shall
hold in such account or accounts, subject to the provisions hereof, all cash
received by it from or for the account of the Series. WILMINGTON TRUST COMPANY
shall make payments of cash to, or for the account of, the Series from such cash
only (a) for the purchase of securities for the portfolio of the Series upon the
delivery of such securities to WILMINGTON TRUST COMPANY, registered in the name
of the Series or of the nominee of WILMINGTON TRUST COMPANY referred to in
Section 7 or in proper form for transfer, (b) for the purchase or redemption of
shares of the capital stock of the SerieS upon delivery thereof to WILMINGTON
TRUST COMPANY, (c) for the payment of interest, dividends, taxes, management or
supervisory fees or operating expenses (including, without limitation thereto,
fees for legal, accounting and auditing services), (d) for payments in
connection with the conversion, exchange or surrender of securities owned or
subscribed to by the Series held by or to be delivered to WILMINGTON TRUST
COMPANY; or (e) for other proper purposes for the Series. Before making any such
payment, WILMINGTON TRUST COMPANY shall receive (and may rely upon) a telephone
call from a Qualified Officer followed by an officers' certificate requesting
such payment and stating that it is for a purpose permitted under the terms of
items (a), (b), (c) or (d) of this subsection A. With respect to item (e) of
this subsection, the Custodian shall also receive an officers' certificate and a
certified copy of a resolution of the officers of the Fund signed by an officer
of the Fund on behalf of the Series and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring such purpose to be a
proper corporate purpose, and naming the person or persons to whom such payment
is to be made.
B. Custodian is hereby authorized to endorse, and collect all checks,
drafts or other orders for the payment of money received by Custodian for the
account of the Series.
Section 4. Receipt of Securities.
Custodian shall hold in a separate account, and physically segregated at
all times from those of any other persons, firms or corporations, pursuant to
the provisions hereof, all securities received by it from or for the account of
the Series. All such securities are to be held or disposed of by Custodian for,
and subject at all times to the instructions of, the Fund on behalf of the
Series pursuant to the terms of this Agreement. The Custodian shall have no
power or authority to assign, hypothecate, pledge or otherwise dispose of any
such
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<PAGE>
securities and investments, except pursuant to the directive of the Fund and
only for the account of the Series as set forth in Section 5 of this Agreement.
Section 5. Transfer, Exchange, Redelivery, Etc. of Securities.
Custodian shall have sole power to release or deliver any securities of the
Series held by it pursuant to this Agreement. Custodian agrees to transfer,
exchange or deliver securities held by it hereunder only (a) for sales of such
securities for the account of the Series upon receipt by Custodian of payment
therefor, (b) when such securities are called, redeemed or retired or otherwise
become payable, (c) for examination by any broker selling any such securities in
accordance with "street delivery" custom, (d) in exchange for or upon conversion
into other securities alone or other securities and cash whether pursuant to any
plan of merger, consolidation, reorganization, recapitalization, or
readjustment, or otherwise, (e) upon conversion of such securities pursuant to
their terms into other securities, (f) upon exercise of subscription, purchase
or other similar rights represented by such securities for definitive
securities, (h) for the purpose of redeeming in kind shares of beneficial
interest of the Series upon delivery thereof to Custodian, or (i) for other
proper purposes for the Series. As to any deliveries made by Custodian pursuant
to items (b), (d), (e), (f) and (g), securities or cash receivable in exchange
therefor shall be deliverable to Custodian. Before making any such transfer,
exchange or delivery, Custodian shall receive (and may rely upon) an officers'
certificate requesting such transfer, exchange or delivery and stating that it
is for a purpose permitted under the terms of items (a), (b), (c), (d), (e),
(f), (g) or (h) of this Section 5. With respect to item (i), the Custodian shall
also receive an officers' certificate and a certified copy of a resolution of
the officers signed by an officer of the Fund on behalf of the Series and
certified by its Secretary or an Assistant Secretary, specifying the securities
to be delivered, setting forth the purpose for which such delivery is to be
made, declaring such purpose to be a proper corporate purpose, and naming the
person or persons to whom delivery of such securities shall be made.
A. Notwithstanding the provisions of Sections 3A, 4 and 5 of this
Agreement, the Custodian, upon terms and conditions set out in an officers'
certificate from the Fund on behalf of the Series, may either directly or
through one or more agents which are also qualified to act as custodians for
investment companies under the provisions of the Investment Company Act of 1940
and of this Agreement, both as amended to date, deposit all or any part of the
securities held hereunder in a clearing agency which acts as a securities
depository or use the book-entry system (as such entities are defined at 17 CFR
270.l7f-4(b)). So
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<PAGE>
long as any such deposit or system of record keeping is maintained for the
Series, the Custodian;
(1) shall deposit or record those securities that are so maintained
only in an account that is limited to assets held by it for customers;
(2) shall send the Fund a confirmation (i.e., an advice or notice of a
transaction) of any transfers to or from the account of the Series;
(3) shall, with respect to securities transferred to the account of
the Series and maintained in a securities depository or the book-entry system,
by book entry or otherwise, identify as belonging to the Series a quantity of
securities in a fungible bulk of securities (i) registered in the name of the
Custodian or its nominee, or (ii) shown on the Custodian's account on the books
of the clearing agency, the book-entry system, or the Custodian's agent;
(4) shall promptly send to the Fund reports it receives from the
appropriate Federal Reserve bank or clearing agency on its respective system of
internal accounting control; and
(5) shall send to the Fund such reports on the systems of internal
accounting control of the Custodian and its agents through which such securities
are deposited as are available and as the Fund may reasonably request from time
to time.
The Custodian may appoint one or more banking institutions which are
qualified to act as custodians for investment companies under the provisions of
the Investment Company Act of 1940 and of this Agreement, both as amended to
date, as a depository or as a subcustodian of any of the assets of the Series
subject to this Agreement upon terms and conditions approved in an officers'
certificate.
Section 6. Custodian's Acts Without Instructions.
Unless and until Custodian receives an officers' certificate to the
contrary, Custodian shall:
(a) Present for payment all coupons and other income items held by it
for the account of the Series which call for payment upon presentation and hold
the cash received by it upon such payment for the account of the Series;
(b) Collect interest and cash dividends received, with notice to the
Fund, to the account of the Series;
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<PAGE>
(c) Hold for the account of the Series hereunder all stock dividends,
rights and similar securities issued with respect to any securities held by it
hereunder;
(d) Execute as agent on behalf of the Series all necessary ownership
certificates required by the Internal Revenue Code or the income tax regulations
of the United States Treasury Department or under the laws of any state now or
hereafter in effect, inserting the Series' name on such certificates as the
owner of the securities covered thereby, to the extent it may lawfully do so.
Section 7. Registration of Securities.
Except as otherwise directed by an officers' certificate, Custodian shall
register all securities, except such as are in bearer form, in the name of a
registered nominee of Custodian as defined in the Internal Revenue Code and any
regulations of the Treasury Department issued thereunder or in any provision of
any subsequent Federal tax law exempting such transaction from liability for
stock transfer taxes, and shall execute and deliver all such certificates in
connection therewith as may be required by such laws or regulations or under the
laws of any state. Custodian shall use its best efforts to the end that the
specific securities held by it hereunder shall be at all times identifiable in
its records.
The Fund shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of its registered nominee, any securities which it
may hold for the account of the Series and which may from time to time be
registered in the name of the Series.
Section 8. Voting and Other Action.
Neither Custodian nor any nominee of Custodian shall vote any of the
securities held hereunder by or for the account of the Series except in
accordance with the instructions contained in an officers' certificate.
Custodian shall promptly deliver, or cause to be executed and delivered, to the
Fund all notices, proxies and proxy soliciting materials with relation to such
securities (if registered otherwise than in the name of the Series), but without
indicating the manner in which such proxies are to be voted.
Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of securities
and expirations of rights in connection therewith) received by Custodian from
issuers of the securities being held for the Series. With respect to tender or
exchange offers, Custodian shall transmit promptly to the Fund
-5-
<PAGE>
all written information received by the Custodian from issuers of the securities
whose tender or exchange is sought and from the party (or his agents) making the
tender or exchange offer.
Section 9. Segregated Accounts for FCMs.
The Custodian may enter into separate custodial agreements with various
Futures Commission Merchants ("FCMs") which the Series uses (each an "FCM
agreement"), pursuant to which the Series margin deposits in certain
transactions involving futures contracts and options on futures contracts will
be held by the Custodian in accounts (each an "FCM account") subject to the
disposition by the FCM involved in such contracts in accordance with the
customer contract between FCM and the Fund on behalf of the Series ("FCM
contract"), Securities and Exchange Commission ("SEC") rules governing such
segregated accounts, Commodities Futures Trading Commission ("CFTC") rules and
the rules of applicable securities or commodities exchange. Such custodial
agreements shall only be entered into upon receipt of written instructions from
the Fund on behalf of the Series which state that (a) a customer agreement
between the FCM and the Fund on behalf of the Series has been entered into and
(b) the Fund is in compliance with all the rules and regulations of the CFTC.
Transfers of initial margin shall be made into an FCM account only upon written
instructions; transfers of premium and variation margin may be made into an FCM
account pursuant to oral instructions. Transfers of funds from an FCM account to
the FCM for which the Custodian holds such an account may only occur upon
certification by the FCM to the Custodian that pursuant to the FCM Agreement and
the FCM Contract, all conditions precedent to its right to give the Custodian
such instructions have been satisfied.
Section 10. Transfer Tax and Other Disbursements.
The Series shall pay or reimburse Custodian from time to time for any
transfer taxes payable upon transfers of securities made hereunder, and for all
other necessary and proper disbursements and expenses made or incurred by
Custodian in the performance of this Agreement.
Custodian shall execute and deliver such certificates in connection with
securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any regulations of the
Treasury Department issued thereunder, or under the laws of any state, to exempt
from taxation any exemptible transfers and/or deliveries of any such securities.
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<PAGE>
Section 11. Concerning Custodian.
Custodian shall be paid as compensation for its services pursuant to this
Agreement such compensation as may from time to time be agreed upon in writing
between the two parties.
Custodian shall not be liable for any action taken in good faith upon any
certificate herein described or certified copy of any resolution of the
officers, and may rely on the genuineness of any such document which it may in
good faith believe to have been validly executed.
The Fund on behalf of the Series agrees to indemnify and hold harmless
Custodian and its nominee from all taxes, charges, expenses, assessments, claims
and liabilities (including counsel fees) incurred or assessed against it or its
nominee in connection with the performance of this Agreement, except such as may
arise from its or its nominee's own negligent action, negligent failure to act
or willful misconduct. Custodian is authorized to charge any account of the
Series for such items. In the event of any advance of cash for any purposes made
by Custodian resulting from orders or instructions of the Fund on behalf of the
Series or in the event that Custodian or its nominee shall incur or be assessed
any taxes, charges, expenses, assessments, claims or liabilities in connection
with the performance of this Agreement, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the Series shall be security
therefor.
Section 12. Reports by Custodian.
Custodian shall furnish the Fund on behalf of the Series daily with a
statement of all transactions and entries for the account of the Series.
Custodian shall furnish the Fund on behalf of the Series at the end of every
month with a summary of all transactions. The books and records of Custodian
pertaining to its actions under this Agreement shall be open to inspection and
audit at reasonable times by officers of and auditors employed by the Fund on
behalf of the Series.
Section 13. Termination or Assignment.
This Agreement may be terminated by the Fund on behalf of the Series or by
Custodian on sixty days' notice given in writing and sent by registered or
certified mail to Custodian or to the Fund on behalf of the Series as the case
may be. In the event of termination hereof by the Fund on behalf of the Series
as aforesaid;
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<PAGE>
(a) Custodian shall deliver to the Fund on behalf of the Series on the
termination date a complete account of its transactions and activities
hereunder; and
(b) All securities, cash and other property being administered by
Custodian shall be delivered as directed by the Fund on behalf of the Series to
a successor Custodian immediately upon the effective date of termination of this
Agreement; or
(c) In the event of a vote of the shareholders of the Series to
dissolve or to function without a Custodian of its cash, securities and other
property (as evidenced by a certified copy of such resolution of shareholders
delivered to Custodian), Custodian shall deliver such cash, securities and other
property to, or upon the order of, the Fund on behalf of the Series immediately
upon the effective date of termination of this Agreement.
In the event that at the effective date of termination no successor
Custodian has been designated by the Fund on behalf of the Series and Custodian
has not been supplied with a certified copy of a resolution of shareholders of
the Series to dissolve or to function without a Custodian of its cash,
securities and other property, Custodian shall immediately deliver such in the
City of Wilmington, Delaware, to a Custodian of its own selection, having an
aggregate capital, surplus and undivided profits, as shown by its published
report, of not less than ten million dollars ($10,000,000) as a Custodian for
the Series, to be held under terms similar to those of this Agreement.
Dated this 29th day of November, 1989.
WILMINGTON TRUST COMPANY
Attest:/s/ By:/s/
THE CROWLEY PORTFOLIO GROUP, INC.
Attest:/s/ Catherine C. Crowley By:/s/ Robert A. Crowley
Robert A. Crowley
President
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CUSTODIAN AGREEMENT WITH BANK
AGREEMENT
THIS AGREEMENT between THE CROWLEY PORTFOLIO GROUP, INC., a corporation
organized under the laws of the State of Maryland (hereinafter called the
"Fund"), and WILMINGTON TRUST COMPANY, a banking corporation organized under the
laws of the State of Delaware (hereinafter called "Custodian").
W I T N E S S E T H:
WHEREAS, the Fund desires that the securities and cash of its series, The
Crowley Diversified Management Portfolio (hereinafter referred to as "Series")
shall be hereafter held and administered by Custodian pursuant to the terms of
this Agreement:
NOW THEREFORE, in consideration of the mutual agreements herein made, the
Fund and Custodian agree as follows:
Section 1. Definitions.
The word "securities" as used herein includes stocks, shares, bonds,
debentures, notes, mortgages or other obligations and any certificates,
receipts, warrants or other instruments representing rights to receive, purchase
or subscribe for the same, or evidencing or representing any other rights or
interests therein, or in any property or assets. The word "securities" as used
herein shall also include "book-entries" maintained by the Custodian in accord
with the provisions of Section 5A of this Agreement.
The words "officers' certificate" shall mean a request or direction or
certification in writing signed in the name of the Series by any two of the
following officers, the President, a Vice President, the Secretary and the
Treasurer of the Fund, or Assistant Vice President, Assistant Secretary or
Assistant Treasurer duly authorized to sign by the officers of the Fund (each
hereinafter called a "Qualified Officer").
Section 2. Names, Titles and Signatures of Officers.
An officer of the Fund will certify to WILMINGTON TRUST COMPANY the names
and signatures of those persons authorized to sign the officers' certificates
described in Section l hereof, together with any changes which may occur from
time to time.
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Section 3. Receipt and Disbursement of Money.
A. Custodian shall open and maintain a separate account or accounts in the
name of the Series, subject only to draft or order by WILMINGTON TRUST COMPANY
acting pursuant to the terms of this Agreement. WILMINGTON TRUST COMPANY shall
hold in such account or accounts, subject to the provisions hereof, all cash
received by it from or for the account of the Series. WILMINGTON TRUST COMPANY
shall make payments of cash to, or for the account of, the Series from such cash
only (a) for the purchase of securities for the portfolio of the Series upon the
delivery of such securities to WILMINGTON TRUST COMPANY, registered in the name
of the Series or of the nominee of WILMINGTON TRUST COMPANY referred to in
Section 7 or in proper form for transfer, (b) for the purchase or redemption of
shares of the capital stock of the SerieS upon delivery thereof to WILMINGTON
TRUST COMPANY, (c) for the payment of interest, dividends, taxes, management or
supervisory fees or operating expenses (including, without limitation thereto,
fees for legal, accounting and auditing services), (d) for payments in
connection with the conversion, exchange or surrender of securities owned or
subscribed to by the Series held by or to be delivered to WILMINGTON TRUST
COMPANY; or (e) for other proper purposes for the Series. Before making any such
payment, WILMINGTON TRUST COMPANY shall receive (and may rely upon) a telephone
call from a Qualified Officer followed by an officers' certificate requesting
such payment and stating that it is for a purpose permitted under the terms of
items (a), (b), (c) or (d) of this subsection A. With respect to item (e) of
this subsection, the Custodian shall also receive an officers' certificate and a
certified copy of a resolution of the officers of the Fund signed by an officer
of the Fund on behalf of the Series and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring such purpose to be a
proper corporate purpose, and naming the person or persons to whom such payment
is to be made.
B. Custodian is hereby authorized to endorse, and collect all checks,
drafts or other orders for the payment of money received by Custodian for the
account of the Series.
Section 4. Receipt of Securities.
Custodian shall hold in a separate account, and physically segregated at
all times from those of any other persons, firms or corporations, pursuant to
the provisions hereof, all securities received by it from or for the account of
the Series. All such securities are to be held or disposed of by Custodian for,
and subject at all times to the instructions of, the Fund on behalf of the
Series pursuant to the terms of this Agreement. The Custodian shall have no
power or authority to assign, hypothecate, pledge or otherwise dispose of any
such
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securities and investments, except pursuant to the directive of the Fund and
only for the account of the Series as set forth in Section 5 of this Agreement.
Section 5. Transfer, Exchange, Redelivery, Etc. of Securities.
Custodian shall have sole power to release or deliver any securities of the
Series held by it pursuant to this Agreement. Custodian agrees to transfer,
exchange or deliver securities held by it hereunder only (a) for sales of such
securities for the account of the Series upon receipt by Custodian of payment
therefor, (b) when such securities are called, redeemed or retired or otherwise
become payable, (c) for examination by any broker selling any such securities in
accordance with "street delivery" custom, (d) in exchange for or upon conversion
into other securities alone or other securities and cash whether pursuant to any
plan of merger, consolidation, reorganization, recapitalization, or
readjustment, or otherwise, (e) upon conversion of such securities pursuant to
their terms into other securities, (f) upon exercise of subscription, purchase
or other similar rights represented by such securities for definitive
securities, (h) for the purpose of redeeming in kind shares of beneficial
interest of the Series upon delivery thereof to Custodian, or (i) for other
proper purposes for the Series. As to any deliveries made by Custodian pursuant
to items (b), (d), (e), (f) and (g), securities or cash receivable in exchange
therefor shall be deliverable to Custodian. Before making any such transfer,
exchange or delivery, Custodian shall receive (and may rely upon) an officers'
certificate requesting such transfer, exchange or delivery and stating that it
is for a purpose permitted under the terms of items (a), (b), (c), (d), (e),
(f), (g) or (h) of this Section 5. With respect to item (i), the Custodian shall
also receive an officers' certificate and a certified copy of a resolution of
the officers signed by an officer of the Fund on behalf of the Series and
certified by its Secretary or an Assistant Secretary, specifying the securities
to be delivered, setting forth the purpose for which such delivery is to be
made, declaring such purpose to be a proper corporate purpose, and naming the
person or persons to whom delivery of such securities shall be made.
A. Notwithstanding the provisions of Sections 3A, 4 and 5 of this
Agreement, the Custodian, upon terms and conditions set out in an officers'
certificate from the Fund on behalf of the Series, may either directly or
through one or more agents which are also qualified to act as custodians for
investment companies under the provisions of the Investment Company Act of 1940
and of this Agreement, both as amended to date, deposit all or any part of the
securities held hereunder in a clearing agency which acts as a securities
depository or use the book-entry system (as such entities are defined at 17 CFR
270.l7f-4(b)). So
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<PAGE>
long as any such deposit or system of record keeping is maintained for the
Series, the Custodian;
(1) shall deposit or record those securities that are so maintained
only in an account that is limited to assets held by it for customers;
(2) shall send the Fund a confirmation (i.e., an advice or notice of a
transaction) of any transfers to or from the account of the Series;
(3) shall, with respect to securities transferred to the account of
the Series and maintained in a securities depository or the book-entry system,
by book entry or otherwise, identify as belonging to the Series a quantity of
securities in a fungible bulk of securities (i) registered in the name of the
Custodian or its nominee, or (ii) shown on the Custodian's account on the books
of the clearing agency, the book-entry system, or the Custodian's agent;
(4) shall promptly send to the Fund reports it receives from the
appropriate Federal Reserve bank or clearing agency on its respective system of
internal accounting control; and
(5) shall send to the Fund such reports on the systems of internal
accounting control of the Custodian and its agents through which such securities
are deposited as are available and as the Fund may reasonably request from time
to time.
The Custodian may appoint one or more banking institutions which are
qualified to act as custodians for investment companies under the provisions of
the Investment Company Act of 1940 and of this Agreement, both as amended to
date, as a depository or as a subcustodian of any of the assets of the Series
subject to this Agreement upon terms and conditions approved in an officers'
certificate.
Section 6. Custodian's Acts Without Instructions.
Unless and until Custodian receives an officers' certificate to the
contrary, Custodian shall:
(a) Present for payment all coupons and other income items held by it
for the account of the Series which call for payment upon presentation and hold
the cash received by it upon such payment for the account of the Series;
(b) Collect interest and cash dividends received, with notice to the
Fund, to the account of the Series;
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(c) Hold for the account of the Series hereunder all stock dividends,
rights and similar securities issued with respect to any securities held by it
hereunder;
(d) Execute as agent on behalf of the Series all necessary ownership
certificates required by the Internal Revenue Code or the income tax regulations
of the United States Treasury Department or under the laws of any state now or
hereafter in effect, inserting the Series' name on such certificates as the
owner of the securities covered thereby, to the extent it may lawfully do so.
Section 7. Registration of Securities.
Except as otherwise directed by an officers' certificate, Custodian shall
register all securities, except such as are in bearer form, in the name of a
registered nominee of Custodian as defined in the Internal Revenue Code and any
regulations of the Treasury Department issued thereunder or in any provision of
any subsequent Federal tax law exempting such transaction from liability for
stock transfer taxes, and shall execute and deliver all such certificates in
connection therewith as may be required by such laws or regulations or under the
laws of any state. Custodian shall use its best efforts to the end that the
specific securities held by it hereunder shall be at all times identifiable in
its records.
The Fund shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of its registered nominee, any securities which it
may hold for the account of the Series and which may from time to time be
registered in the name of the Series.
Section 8. Voting and Other Action.
Neither Custodian nor any nominee of Custodian shall vote any of the
securities held hereunder by or for the account of the Series except in
accordance with the instructions contained in an officers' certificate.
Custodian shall promptly deliver, or cause to be executed and delivered, to the
Fund all notices, proxies and proxy soliciting materials with relation to such
securities (if registered otherwise than in the name of the Series), but without
indicating the manner in which such proxies are to be voted.
Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of securities
and expirations of rights in connection therewith) received by Custodian from
issuers of the securities being held for the Series. With respect to tender or
exchange offers, Custodian shall transmit promptly to the Fund
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<PAGE>
all written information received by the Custodian from issuers of the
securities whose tender or exchange is sought and from the party (or his agents)
making the tender or exchange offer.
Section 9. Segregated Accounts for FCMs.
The Custodian may enter into separate custodial agreements with various
Futures Commission Merchants ("FCMs") which the Series uses (each an "FCM
agreement"), pursuant to which the Series margin deposits in certain
transactions involving futures contracts and options on futures contracts will
be held by the Custodian in accounts (each an "FCM account") subject to the
disposition by the FCM involved in such contracts in accordance with the
customer contract between FCM and the Fund on behalf of the Series ("FCM
contract"), Securities and Exchange Commission ("SEC") rules governing such
segregated accounts, Commodities Futures Trading Commission ("CFTC") rules and
the rules of applicable securities or commodities exchange. Such custodial
agreements shall only be entered into upon receipt of written instructions from
the Fund on behalf of the Series which state that (a) a customer agreement
between the FCM and the Fund on behalf of the Series has been entered into and
(b) the Fund is in compliance with all the rules and regulations of the CFTC.
Transfers of initial margin shall be made into an FCM account only upon written
instructions; transfers of premium and variation margin may be made into an FCM
account pursuant to oral instructions. Transfers of funds from an FCM account to
the FCM for which the Custodian holds such an account may only occur upon
certification by the FCM to the Custodian that pursuant to the FCM Agreement and
the FCM Contract, all conditions precedent to its right to give the Custodian
such instructions have been satisfied.
Section 10. Transfer Tax and Other Disbursements.
The Series shall pay or reimburse Custodian from time to time for any
transfer taxes payable upon transfers of securities made hereunder, and for all
other necessary and proper disbursements and expenses made or incurred by
Custodian in the performance of this Agreement.
Custodian shall execute and deliver such certificates in connection with
securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any regulations of the
Treasury Department issued thereunder, or under the laws of any state, to exempt
from taxation any exemptible transfers and/or deliveries of any such securities.
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<PAGE>
Section 11. Concerning Custodian.
Custodian shall be paid as compensation for its services pursuant to this
Agreement such compensation as may from time to time be agreed upon in writing
between the two parties.
Custodian shall not be liable for any action taken in good faith upon any
certificate herein described or certified copy of any resolution of the
officers, and may rely on the genuineness of any such document which it may in
good faith believe to have been validly executed.
The Fund on behalf of the Series agrees to indemnify and hold harmless
Custodian and its nominee from all taxes, charges, expenses, assessments, claims
and liabilities (including counsel fees) incurred or assessed against it or its
nominee in connection with the performance of this Agreement, except such as may
arise from its or its nominee's own negligent action, negligent failure to act
or willful misconduct. Custodian is authorized to charge any account of the
Series for such items. In the event of any advance of cash for any purposes made
by Custodian resulting from orders or instructions of the Fund on behalf of the
Series or in the event that Custodian or its nominee shall incur or be assessed
any taxes, charges, expenses, assessments, claims or liabilities in connection
with the performance of this Agreement, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the Series shall be security
therefor.
Section 12. Reports by Custodian.
Custodian shall furnish the Fund on behalf of the Series daily with a
statement of all transactions and entries for the account of the Series.
Custodian shall furnish the Fund on behalf of the Series at the end of every
month with a summary of all transactions. The books and records of Custodian
pertaining to its actions under this Agreement shall be open to inspection and
audit at reasonable times by officers of and auditors employed by the Fund on
behalf of the Series.
Section 13. Termination or Assignment.
This Agreement may be terminated by the Fund on behalf of the Series or by
Custodian on sixty days' notice given in writing and sent by registered or
certified mail to Custodian or to the Fund on behalf of the Series as the case
may be. In the event of termination hereof by the Fund on behalf of the Series
as aforesaid;
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<PAGE>
(a) Custodian shall deliver to the Fund on behalf of the Series on the
termination date a complete account of its transactions and activities
hereunder; and
(b) All securities, cash and other property being administered by
Custodian shall be delivered as directed by the Fund on behalf of the Series to
a successor Custodian immediately upon the effective date of termination of this
Agreement; or
(c) In the event of a vote of the shareholders of the Series to
dissolve or to function without a Custodian of its cash, securities and other
property (as evidenced by a certified copy of such resolution of shareholders
delivered to Custodian), Custodian shall deliver such cash, securities and other
property to, or upon the order of, the Fund on behalf of the Series immediately
upon the effective date of termination of this Agreement.
In the event that at the effective date of termination no successor
Custodian has been designated by the Fund on behalf of the Series and Custodian
has not been supplied with a certified copy of a resolution of shareholders of
the Series to dissolve or to function without a Custodian of its cash,
securities and other property, Custodian shall immediately deliver such in the
City of Wilmington, Delaware, to a Custodian of its own selection, having an
aggregate capital, surplus and undivided profits, as shown by its published
report, of not less than ten million dollars ($10,000,000) as a Custodian for
the Series, to be held under terms similar to those of this Agreement.
Dated this 31st day of March, 1995.
WILMINGTON TRUST COMPANY
Attest:/s/ By:/s/
THE CROWLEY PORTFOLIO GROUP, INC.
Attest:/s/ Catherine C. Crowley By:/s/ Robert A. Crowley
Robert A. Crowley
President
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THE CROWLEY PORTFOLIO GROUP, INC.
SHAREHOLDER SERVICES AGREEMENT
THIS AGREEMENT, made as of this 1st day of August, 1993 by and between THE
CROWLEY PORTFOLIO GROUP, INC. ("Fund"), a Maryland corporation, for THE CROWLEY
GROWTH PORTFOLIO and THE CROWLEY INCOME PORTFOLIO series of the Fund and any
additional series to be created in the future (individually a "Series" and
collectively the "Series") and THE CROWLEY FINANCIAL GROUP, INC. ("Crowley
Financial"), a Delaware corporation, each having its principal office and place
of business at 1813 Marsh Road, Suite H, Wilmington, Delaware 19810.
W I T N E S S E T H:
WHEREAS, the Management Contracts between Fund on behalf of each series and
Crowley and Crowley Corp. provide that Fund will, on behalf of each of its
series, pay all of its own operating expenses and costs including, without
limitation, the costs related to the provision of investor services and the fees
and charges associated with its transfer and dividend disbursing agent and the
costs incurred in sending notices to shareholders and the calling and holding of
shareholder meetings; and
WHEREAS, Fund and Crowley Financial desire to have a written agreement
concerning the performance of the foregoing services and providing compensation
therefor;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth, and intending legally to be bound, it is agreed:
I. APPOINTMENT AS AGENT
Section 1.1 Fund hereby appoints Crowley Financial its Shareholder Services
Agent for the Series to provide as agent for the Fund services as Transfer
Agent, Dividend Disbursing Agent and Shareholder Servicing Agent and Crowley
Financial hereby accepts such appointment and agrees to provide Fund, as its
agent, the services described herein.
Section 1.2 Fund shall pay Crowley Financial and Crowley Financial shall
accept, for the services provided hereunder, the compensation provided for in
Section VIII hereof. Fund also shall reimburse Crowley Financial for expenses
incurred
<PAGE>
or advanced by it for the Fund in connection with its services hereunder.
II. DOCUMENTATION
Section 2.1 Fund represents that it has provided or made available to
Crowley Financial (or has given Crowley Financial an opportunity to examine)
copies of, and, Crowley Financial represents that it has received from Fund (or
is otherwise familiar with), the following documents:
A. The Articles of Incorporation evidencing Fund's form of
organization and any current amendments thereto;
B. The By-Laws of Fund, as amended to date;
C. Any resolution or other action of Fund or the Board of Directors of
Fund establishing or affecting the rights, privileges or other status of any
class or series of shares of Fund, or altering or abolishing any such class or
series;
D. A certified copy of a resolution of the Board of Directors of Fund
appointing Crowley Financial as Shareholder Services Agent for the Series and
authorizing the execution of this Agreement;
E. The form of share certificates of the Series in the form approved
by the Board of Directors of Fund;
F. A copy of Fund's currently effective prospectus and Statement of
Additional Information under the Securities Act of 1933;
G. Copies of all account application forms and other documents
relating to shareholder accounts of the Series;
H. Copies of documents relating to any Plans of Fund for the purchase,
sale or repurchase of its shares, including periodic payment or withdrawal
plans, reinvestment plans or retirement plans, if applicable;
I. Any opinion of counsel to Fund relating to the authorization and
validity of the shares of the Series issued or proposed to be issued under the
law of the State of Fund's organization, including the status thereof under any
applicable securities laws;
J. A certified coipy of any resolution of the Board of Directors of
Fund authorizing any person to give instructions to Crowley Financial under this
Agreement (with a
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specimen signature of such person if not already provided), setting forth the
scope of such authority; and
K. Any amendment, revocation or other document altering, adding,
qualifying or repealing any document or authority called for under this Section
2.1.
Section 2.2 Fund and Crowley Financial may consult as to forms or documents
that may be required in performing services hereunder.
Section 2.3 Fund shall provide or make available to Crowley Financial a
certified copy of any resolution of the shareholders or the Board of Directors
of Fund providing for a dividend, capital gains distribution, distribution of
capital, stock dividend, stock split or other similar action affecting the
authorization or issuance of shares of Fund or the payment of dividends.
Section 2.4 In the case of any recapitalization or other capital adjustment
requiring a change in the form of stock or share certificate or the books
recording the same, Fund shall deliver or make available to Crowley Financial:
A. A certified copy of any document authorizing or effecting such
change;
B. Written instructions from an authorized officer implementing such
change; and
C. An opinion of counsel to Fund as to the validity of such action, if
requested by Crowley Financial.
Section 2.5 Fund warrants the following:
A. Fund is a properly registered investment company under the
Investment Company Act of 1940 and any and all shares which it issues will be
properly registered and lawfully issued under applicable federal and state laws.
B. The provisions of this contract do not violate the terms of any
instrument by which the Fund is bound; nor do they violate any law or regulation
of any body having jurisdiction over the Fund or its property.
Section 2.6 Crowley Financial warrants the following:
A. Crowley Financial is and will be properly registered as a transfer
agent under the Securities Exchange Act of 1934 and is duly authorized to serve,
and may lawfully serve as such.
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B. The provisions of this contract do not violate the terms of any
instrument by which Crowley Financial is bound; nor do they violate any law or
regulation of any body having jurisdiction over Crowley Financial or its
property.
III. SHARE CERTIFICATES
Section 3.1 Fund shall furnish or authorize Crowley Financial to obtain, at
Fund's expense, a sufficient supply of blank stock certificates for the Series,
and from time to time will replenish such supply upon the request of Crowley
Financial. Fund agrees to indemnify and exonerate, save and hold Crowley
Financial harmless, from and against any and all claims or demands that may be
asserted against Crowley Financial concerning the genuineness of any stock
certificate supplied to Crowley Financial pursuant to this section.
Section 3.2 Crowley Financial shall safeguard, and shall account to Fund,
upon its demand for, all such share certificates: (A) as issued, showing to whom
issued, or (B) as unissued, establishing the safekeeping, cancellation or
destruction thereof.
Section 3.3 Fund shall promptly inform Crowley Financial in writing of any
change in the officers authorized to sign share certificates or in the form
thereof. If an officer whose manual or facsimile signature is affixed to any
blank share certificate shall die, resign or be removed prior to the issuance of
such certificate, Crowley Financial may nevertheless issue such certificate
notwithstanding such death, resignation or removal, and the Fund shall with
respect thereto, promptly provide to Crowley Financial any approval, adoption or
ratification as may be required by Crowley Financial.
IV. TRANSFER AGENT
Section 4.1 As Transfer Agent, Crowley Financial shall issue, redeem and
transfer shares of the Series, and, in connection therewith but not in
limitation thereof, it shall:
A. Upon receipt of authority to issue shares, determine the total
shares to be issued and issue such shares by crediting shares to accounts
created and maintained in the registration forms provided; as applicable,
prepare, issue and deliver stock certificates.
B. Upon proper transfer authorization, transfer shares by debiting
transferor-shareholder accounts and crediting such shares to accounts created
and/or maintained for transferee-
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<PAGE>
shareholders; if applicable, issue and/or cancel stock certificates.
C. Upon proper redemption authorization, determine the total shares to
be redeemed and redeem; determine the total redemption payments to be made and
make payment; redeem shares by debiting shareholder accounts; as applicable
receive and cancel stock certificates for shares redeemed; and remit or cause to
be remitted the redemption proceeds to shareholders.
D. Create and maintain accounts; reconcile and control cash due and
paid, shares issued and to be issued, cash to be remitted and remitted and
shares debited and credited to accounts; provide such notices, instructions or
authorizations as Fund may require.
Section 4.2 Crowley Financial shall not be required to issue, transfer or
redeem Series shares upon receipt of it from Fund, or from any federal or state
regulatory agency or authority, written notice that the issuance, transfer or
redemption of Series shares has been suspended or discontinued.
V. DIVIDEND DISBURSING AGENT
Section 5.1 As Dividend Disbursing Agent for the Series, Crowley Financial
shall disburse and cause to be disbursed to Series shareholders Series
dividends, capital gains distributions or any payments from other sources as
directed by Fund. In connection therewith, but not in limitation thereof,
Crowley Financial shall:
A. Calculate the total disbursement due and payable and the
disbursement to each shareholder as to shares owned, in accordance with Fund's
authorization.
B. Calculate the total disbursements for each shareholder, as
aforesaid, to be disbursed in cash; prepare and mail check therefor.
C. Calculate the total disbursement for each shareholder, as
aforesaid, for which Series shares are to be issued, and authorized and instruct
the issuance of Series shares therefor in accordance with Section IV hereof.
D. Prepare and mail or deliver such forms and notices pertaining to
disbursements as required by the federal or state authority.
E. Create and maintain records, reconcile and control disbursements to
be made and made, both as to cash and
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shares, as aforesaid; provide such notices, instruction or authorization as Fund
may require.
Section 5.2 Crowley Financial shall not be required to make any
disbursement upon the receipt from Fund, or from any federal or state agency or
authority, written notice that such disbursement shall not be made.
VI. SHAREHOLDER SERVICING AGENT
Section 6.1 As Shareholder Servicing Agent, Crowley Financial shall provide
those services ancillary to but in implementation of the services provided under
Sections I through V hereof, and those generally defined and accepted as
Shareholder Services. In connection therewith, but not in limitation thereof,
Crowley Financial shall:
A. Except where instructed in writing by the Fund not to do so, and
where in compliance with applicable law, accept orders on behalf of the Fund;
receive and process investments and applications; remit to Fund or its custodian
payments for shares acquired and to be issued; and direct the issuance of shares
in accordance with Section IV hereof.
B. Receive, record and respond to communications of shareholders and
their agents.
C. As instructed by Fund, prepare and mail shareholder account
information, mail Fund shareholder reports and Fund prospectuses.
D. Prepare and mail Fund proxies and material for Fund shareholder
meetings, receive and process proxies from shareholders, and deliver such
proxies as directed by Fund.
E. Administer investment plans offered by Fund to investors and Series
shareholders, including Retirement Plans, including activities not otherwise
provided in Section I through V of this Agreement.
VII. PERFORMANCE OF DUTIES
Section 7.1 The parties hereto intend that Series shareholders and their
shareholdings shall be confidential, and any information relating thereto shall
be released by Crowley Financial only to those persons or authorities who
Crowley Financial has reason to believe are authorized to receive such
information, or, as instructed by Fund.
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Section 7.2 Crowley Financial may, in performing this Agreement, require
Fund or Fund's distributor to provide it with an adequate number of copies of
prospectuses, reports or other documents required to be furnished to investors
or shareholders.
Section 7.3 Crowley Financial may request or receive instructions from Fund
and may at Fund's expense, consult with counsel for the Fund or its own counsel,
with respect to any matter arising in connection with the performance of its
duties hereunder, and shall not be liable for any action taken or omitted by it
in good faith in accordance with such instructions or opinions of counsel.
Section 7.4 Crowley Financial may, at its option, maintain reasonable
insurance coverage for errors and omissions and reasonable bond coverage for
fraud.
Section 7.5 Upon notice thereof to Fund, Crowley Financial may employ
others to provide services to Crowley Financial in its performance of this
Agreement.
Section 7.6 Personnel and facilities of Crowley Financial used to perform
services hereunder may be used to perform similar services to other Funds of the
Crowley Group, if created in the future, and to others, and may be used to
perform other services for Fund, the other Funds of the Crowley Group and
others.
Section 7.7 Crowley Financial shall provide its services as transfer agent
hereunder in accordance with Section 17 of the Securities Exchange Act of 1934,
and the rules and regulations thereunder. Further, the parties intend that the
processes, procedures, safeguards and controls employed should be those
generally applied and accepted for the type of services provided hereunder by
other institutions providing the same or similar services, and those which
should provide efficient, safe and economical services so as to promote
promptness and accuracy and to maintain the integrity of Fund's records.
Section 7.8 Fund and Crowley Financial may, from time to time, set forth in
writing Guidelines For Selective Procedures to be applicable to the services
hereunder.
VIII. COMPENSATION
Section 8.1 Fund and Crowley Financial acknowledge that because Crowley
Financial has common ownership and close management ties with Fund's investment
advisor and Fund's distributor, advantages and benefits to Fund in the
employment of Crowley Financial hereunder can be available which may not
-7-
<PAGE>
generally be available to it from others providing similar services.
Section 8.2 Fund and Crowley Financial further acknowledge that the
compensation by Fund to Crowley Financial is intended to induce Crowley
Financial to provide services under this Agreement of a nature and quality which
the Board of Directors of Fund, including a majority who are not parties to this
Agreement or interested person of the parties hereto, has determined after due
consideration to be necessary for the conduct of the business of the Fund in the
best interests of the Fund and its shareholders.
Section 8.3 Compensation by Fund to Crowley Financial hereunder shall be
determined in accordance with Schedule A hereto as it shall be amended from time
to time as provided for herein and which is incorporated herein as a part
hereof.
Section 8.4 Compensation as provided in Schedule A shall be reviewed and
approved in the manner set forth in Section 10.1 hereof by the Board of
Directors of Fund at least annually and may be reviewed and approved more
frequently at the request of either party. The Board may request and Crowley
Financial shall provide such information as the Board may reasonably require to
evaluate the basis of and approve the compensation.
IX. STANDARD OF CARE
Section 9.1 Fund acknowledges that Crowley Financial shall not be liable
for, and in the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of the performance of its duties under this contract, agrees
to indemnify Crowley Financial against, any claim, or deficiency arising from
the performance of Crowley Financial's duties hereunder, including Crowley
Financial's costs, counsel fees and expenses incurred in investigating or
defending any such claim or any administrative or other proceeding, and
acknowledges that any risk of loss or damage arising from the conduct of the
Fund's affairs in accordance herewith or in accordance with guidelines or
instructions given hereunder, shall be borne by Fund.
X. CONTRACTUAL STATUS
Section 10.1 This Agreement shall be executed and become effective on the
date first written above if approved by a vote of the Board of Directors,
including an affirmative vote of a majority of the non-interested members of the
Board, cast in person at a meeting called for the purpose of voting on such
approval. It shall continue in effect for an indeterminate
-8-
<PAGE>
period, and is subject to termination on sixty (60) days notice by either party
unless earlier terminated or amended by agreement among the parties.
Compensation under this Agreement shall require approval by a majority vote of
the Board of Directors of Fund, including an affirmative vote of the majority of
the noninterested members of the Board cast in person at a meeting called for
the purpose of voting such approval.
Section 10.2 This Agreement may not be assigned without the approval of
Fund.
Section 10.3 This Agreement shall be governed by the laws of the State of
Delaware.
THE CROWLEY FINANCIAL GROUP, INC.
ATTEST:/s/ Catherine C. Crowley By:/s/ Frederick J. Crowley, Jr.
THE CROWLEY PORTFOLIO GROUP, INC.
By:/s/ Robert A. Crowley
56570.1
-9-
<PAGE>
SCHEDULE A
COMPENSATION
1. Crowley Financial will determine and report to the Fund, at least
annually, the compensation for services to be provided to the Fund for
Crowley Financial's forthcoming fiscal year or period.
2. In determining such compensation, Crowley Financial will fix and report
a fee to be charged per account and/or per transaction, as may be
applicable, for services provided. Crowley Financial will bill, and the
Fund will pay, such compensation monthly.
3. The fee will consist of an annual per account charge coupled with a
series of transaction charges. These are as follows:
A. ANNUAL CHARGES
Asset Based Fee of 1/4 of 1% (.25%) of Average Daily Net
Assets, Payable Monthly
B. TRANSACTION CHARGES
TRANSACTION CHARGE
l. Dividend Payment $
2. New Account
3. Purchase:
a. Wire
N/A
b. Other
4. Transfer
5. Certificate Issuance
6. Liquidation:
a. Wire
b. Draft
c. Other
7. Exchanges
-10-
AMENDMENT I
to the
SHAREHOLDER SERVICES AGREEMENT
of
THE CROWLEY PORTFOLIO GROUP, INC.
WHEREAS, The Crowley Portfolio Group, Inc. (the "Fund") entered into a
Shareholder Services Agreement (the "Agreement") with The Crowley Financial
Group, Inc. ("Crowley Financial") dated August 1, 1994, for The Crowley Growth
Portfolio series and The Crowley Income Portfolio series (collectively, the
"Series") of the Fund; and
WHEREAS, pursuant to the preamble to the Agreement, the Fund and Crowley
Financial desire to include another series of the Fund under the Agreement; and
WHEREAS, the Fund and Crowley Financial wish to amend the Agreement to add The
Crowley Diversified Management Portfolio (the "Portfolio") series to the
Agreement;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth,
and intending to be legally bound, it is agreed that:
1. The Agreement is hereby amended to add the Portfolio to the Agreement,
and Crowley Financial will perform all services and obligations set forth in the
Agreement for the Portfolio as well as the Series.
2. All obligations of the Fund under the Agreement apply to the Fund with
respect to the Portfolio as well as the Series.
3. For services provided to the Portfolio, Crowley Financial is entitled to
compensation as set forth in Article VIII and on Schedule A of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the 31st day of March, 1995.
THE CROWLEY FINANCIAL GROUP, INC.
ATTEST:/s/ Robert A. Crowley By:/s/ Frederick J. Crowley, Jr.
THE CROWLEY PORTFOLIO GROUP, INC.
By:/s/ Robert A. Crowley
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the reference to our firm in the Registration Statement, (Form
N-1A), and related Statement of Additional Information of The Crowley Portfolio
Group, Inc. and to the inclusion of our report dated December 15, 1995 to the
Shareholders and Board of Directors of The Crowley Portfolio Group, Inc.
/s/ Tait, Weller & Baker
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
March 20, 1996
[LETTERHEAD]
March 28, 1996
U.S. Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: The Crowley Portfolio Group, Inc.
Gentlemen:
We are counsel to The Crowley Portfolio Group, Inc. As such, we have
reviewed Post-Effective Amendment No. 8 to the Registration Statement of the
Fund to be filed pursuant to paragraph (b) of Rule 485 promulgated under the
Securities Act of 1933.
In our judgment, Post-Effective Amendment No. 8 to the Registration
Statement does not contain disclosures which would render it ineligible to
become effective pursuant to paragraph (b) of Rule 485.
We consent to the inclusion of this written representation as an
Exhibit to Post-Effective Amendment No. 8 to the Registration Statement of the
Fund.
Very truly yours,
/s/ Bruce G. Leto
Bruce G. Leto
BGL/go
December 1, 1989
The Crowley Portfolio Group, Inc.
Drummond Plaza Office Park
Suite 2101
Newark, DE 19711
Gentlemen:
I, William O. Cregar ("Investor") and I, Elynor K. Cregar ("Investor")
hereby agree to purchase 10,000 shares of common stock of The Crowley Portfolio
Group, Inc. (the "Fund") at $10.00 per share for an aggregate of $100,000.
We further advise that in making this purchase, which represents initial
capital of the Fund, such purchase is for investment purposes only and without
any present intention of further distributing such shares or presenting them for
redemption or repurchase.
In the event that any of the initial shares of the Fund are redeemed during
the amortization period, the Fund's Investment Manager, Crowley & Crowley Corp.,
agrees to reimburse the Fund in the amount of any unamortized organization
expenses in the same proportion as the number of initial shares being redeemed
bears to the number of initial shares of the Fund outstanding at the time of the
redemption.
Very truly yours,
/s/ William O. Cregar /s/ Elynor K. Cregar
William O. Cregar Elynor K. Cregar
Crowley & Crowley Corp.
By: /s/ Robert A. Crowley
Robert A. Crowley
Vice President
EXHIBIT 16
SCHEDULE FOR COMPUTATION OF
PERFORMANCE QUOTATIONS
The Crowley Income Portfolio
YIELD: 6
Yield = 2 [(a-b +1) - 1]
----
cd
a = 56716.58
b = 10283.25
c = 802776.669
d = 11.08
Yield = 6.35%
n
Total Return: P (1 + T) = ERV
Inception to November 30, 1995
P = $1,000
T = 7.63%
n = 6
ERV = $1554.62
Five Year ended November 30, 1995
P = $1,000
T = 7.39%
n = 5
ERV = $1,428.89
One Year ended November 30, 1995
P = $1,000
T = 10.12%
n = 1
ERV = $1,101.19
<PAGE>
The Crowley Growth Portfolio
n
Total Return: P (1 + T) = ERV
Inception to November 30, 1995
P = $1,000
T = 6.33%
n = 6
ERV = $1,445.96
Five Year ended November 30, 1995
P = $1,000
T = 8.29%
n = 5
ERV = $1,489.14
One Year ended November 30, 1995
P = $1,000
T = 11.85%
n = 1
ERV = $1,118.47
The Crowley Diversified Management Portfolio
n
Total Return: P (1 + T) = ERV
Inception to November 30, 1995
P = $1,000
T = 7.10% *
n = 1
ERV = $1,071.00
___________________
*Not annualized
THE CROWLEY PORTFOLIO GROUP, INC.
The Crowley Growth Portfolio
The Crowley Income Portfolio
The Crowley Diversified Management Portfolio
Annual Report Dated
November 30, 1995
Dear Shareholder:
We are pleased to present you with the Annual Report for The Crowley Portfolio
Group, Inc. for the fiscal year ending November 30, 1995. The Portfolios have
just completed their sixth year of operations and have combined assets in excess
of 16.4 million dollars, an increase of 35% over the previous fiscal year.
At year end there were 396 active accounts, up from 304 accounts one year
earlier. The Portfolios performed very well during the most recent fiscal year.
The Crowley Growth Portfolio had a total return of 11.85% for the period
November 30, 1994 through November 30, 1995. The Crowley Growth Portfolio
continued to be invested conservatively with the common stock positions at
approximately 43% at fiscal year end. The remaining assets in the portfolio were
invested in a combination of cash, corporate and government bonds. The Crowley
Income Portfolio had a very good year. The total return was 10.12% during the
period November 30, 1994 through November 30, 1995. The weighted average
maturity of the Portfolio at November 30, 1995 was 5.8 years. The Crowley
Diversified Management Portfolio had a total return 7.10% from its inception on
April 3, 1995 through November 30, 1995. The Diversified Management Portfolio is
designed to be the most aggressive of the three portfolios and is primarily
invested in other mutual funds.
The Portfolios had modest distributions during the fiscal period. The Crowley
Growth Portfolio had a year end distribution as of the year ended December 31,
1994 of $.52 per share ($.12 ordinary and $.40 capital gains) and The Crowley
Income Portfolio had a year end distribution of $.63 per share ($.63 ordinary
and $.00 capital gains).
The enclosed report has been audited by the Funds' Independent Accountants and
contains a list of the Funds' investments as of November 30, 1995. The
Portfolios continue to be managed conservatively. We look forward to continued
success.
Sincerely,
Robert A. Crowley, CFA
President
January 22, 1996
<PAGE>
THE CROWLEY PORTFOLIO GROUP, INC.
FINANCIAL STATEMENTS
November 30, 1995
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Shareholders and Board of Directors
The Crowley Portfolio Group, Inc.
We have audited the accompanying statements of assets and liabilities of
The Crowley Growth Portfolio, The Crowley Income Portfolio and The Crowley
Diversified Management Portfolio, each a series of shares of common stock of The
Crowley Portfolio Group, Inc., including the portfolios of investments as of
November 30, 1995, and the related statements of operations for the year or
period then ended and the statements of changes in net assets, and the financial
highlights for periods indicated thereon. These financial statements and
financial highlights are the responsibility of the Portfolios' management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
November 30, 1995 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of The
Crowley Growth Portfolio, The Crowley Income Portfolio and The Crowley
Diversified Management Portfolio as of November 30, 1995, the results of their
operations for the year or period then ended and changes in their net assets,
and the financial highlights for the period referred to above, in conformity
with generally accepted accounting principles.
Philadelphia, Pennsylvania
December 15, 1995
<PAGE>
The Crowley Growth Portfolio
PORTFOLIO OF INVESTMENTS
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Common Stocks
Aerospace/Defense -
1000 Watkins-Johnson .69% $ 45,375
---- --------
Automotive -
2000 General Motors 1.48 97,000
---- --------
Bank -
2000 First Tennessee National 1.85 121,000
---- --------
Broadcasting/Cable T.V. -
2000 Multimedia* 1.38 90,250
---- --------
Chemicals (Basic) -
3000 E. I. Du Pont 3.05 199,500
4000 Georgia Gulf 2.17 142,500
---- --------
5.22 342,000
---- --------
Chemicals (Diversified) -
1000 Potash 1.06 69,125
1500 Vigoro 1.24 81,188
---- --------
2.30 150,313
---- --------
Chemicals (Specialty) -
3200 Park Electrochemical 1.49 97,200
---- --------
Computer/Peripherals -
5000 EMC* 1.37 89,375
1000 Hewlett-Packard 1.27 83,000
2000 International Business
Machines 2.95 193,250
4000 Western Digital* .93 61,000
---- --------
6.52 426,625
---- --------
Computers Software & Services -
1000 Autodesk .54 35,250
---- --------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Growth Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Common Stocks
Diversified Company -
2000 Hillenbrand 1.00% $ 65,500
1500 ITT* 2.81 183,937
---- -------
3.81 249,437
---- -------
Drug -
1000 Bristol-Myers 1.23 80,250
1000 Merck & Company .94 61,875
---- -------
2.17 142,125
---- -------
Electrical Equipment -
1000 Franklin Electric .47 30,625
2000 General Signal .98 64,500
---- -------
1.45 95,125
---- -------
Foreign Telecommunications -
2000 Vodafone 1.10 72,000
---- -------
Insurance (Life) -
6000 Washington National 2.27 148,500
---- -------
Insurance (Diversified) -
5000 Pioneer Financial Services 1.27 83,125
4000 Lincoln National 2.86 187,000
---- -------
4.13 270,125
---- -------
Machinery -
3150 Raymond* 1.00 65,363
---- -------
Petroleum (Integrated) -
6000 Sun 2.54 166,500
---- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Growth Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Common Stocks
SemiConductor -
5000 Integrated Device Tech.* 1.30% $ 85,000
1000 Novellus Systems* .95 62,000
----- ---------
2.25 147,000
----- ---------
Technology -
10000 Stratordyne* .00 50
----- ---------
Telecommunication Equipment -
1000 Andrew* .66 43,250
1000 DSC Communications* .61 39,625
----- ---------
1.27 82,875
----- ---------
Total Common Stocks
(cost $2,627,604) 43.46 2,844,113
----- ---------
Corporate Bonds & Notes
$ 200,000 Bear Stearns, Note
5.875%, 01-15-96 3.05 199,968
197,000 Citicorp, Note
10.500%, 02-01-16 3.16 206,633
100,000 General Electric Capital
8.650%, 05-01-18 1.54 101,078
300,000 Wisconsin Power & Light,
Note
9.300%, 12-01-25 4.86 317,952
----- ---------
Total Corporate Bonds & Notes
(cost $838,705) 12.61 825,631
----- ---------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Growth Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
U.S. Government Agency
$ 200,000 Federal Home Loan Mtg.
6.75%, 05-06-99 3.09% $ 202,140
200,000 Federal Home Loan Bank
9.12%, 01-23-05 3.07 200,940
200,000 Federal National Mtg.
7.92%, 03-30-05 3.28 214,750
----- ---------
Total U.S. Government Agency
(cost $612,012) 9.44 617,830
----- ---------
U. S. Government Securities
1,000,000 U.S. Treasury Note
5.625%, 01-31-98 15.35 1,004,375
700,000 U.S. Treasury Note
5.500%, 02-28-99 10.71 701,094
400,000 U.S. Treasury Note
5.875%, 02-15-04 6.16 403,250
----- ---------
Total U.S. Government Securities
(cost $2,089,859) 32.22 $2,108,719
----- ---------
Total Investments
(cost $6,168,180) (A) 97.73 6,396,293
Other Assets Less Liabilities 2.27 148,632
----- ---------
Net Assets 100.00% $6,544,925
====== ==========
</TABLE>
(A) Aggregate cost for federal income tax purposes is $6,168,180.
At November 30, 1995 unrealized appreciation (depreciation) of securities
for federal income tax purposes is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $ 326,701
Unrealized depreciation ( 98,589)
---------
Net unrealized appreciation $ 228,112
=========
</TABLE>
* Non - Income Producing Security
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Aerospace/Defense -
$230,000 Boeing Co. Note 8.375%,
03-01-96 2.59% $ 231,725
---- -------
Auto & Truck -
40,000 Ford Holdings
9.250%, 07-15-97 .47 42,112
30,000 Ford Motor Credit Co. Note
8.250%, 05-15-96 .34 30,309
100,000 Ford Motor Company 1993-A
Pass Thru 5.78%, 01-01-99 1.11 99,515
60,000 Ford Motor Credit Co. Note
8.720%, 07-22-99 .74 66,180
30,000 Ford Motor Credit Co. Note
8.000%, 01-15-99 .35 31,711
50,000 General Motors Acceptance
Corp. Deb. 7.750%, 04-15-97 .57 50,844
40,000 General Motors Acceptance
Corp. Note 8.000%, 10-01-96 .46 40,687
50,000 General Motors Acceptance
Corp. Note 9.625%, 12-01-00 .64 57,273
---- -------
4.68 418,631
---- -------
Banking -
60,000 BankAmerica
Corp. Note 7.750%, 07-15-02 .72 64,650
30,000 BankAmerica
Corp. Note 7.875%, 12-01-02 .36 32,573
80,000 Bankers Trust New York
Corp. Note 9.500%, 06-14-00 1.01 90,074
20,000 Bankers Trust New York
Corp. Note 9.400%, 03-01-01 .25 22,621
40,000 Barclays American
Corp. Note 7.875%, 08-15-98 .47 41,762
20,000 Chemical Banking Corp.
Note 10.125%, 11-01-00 .26 23,075
132,000 Citicorp
Note 10.500%, 02-01-16 1.55 138,455
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Banking - continued
$ 40,000 First Union Corp.
Note 9.450%, 06-15-99 .49% $ 44,300
100,000 First Union Corp.
Note 9.890%, 03-13-01 1.30 116,369
20,000 Heller Financial Inc.
Note 8.000%, 12-15-98 .24 21,125
200,000 Morgan J.P. & Co.
Note 9.625%, 12-15-98 2.24 200,186
50,000 Societe Nat. Elf Aquitaine
Note 7.750%, 05-01-99 .59 52,766
50,000 Wells Fargo & Co.
Note 8.200%, 11-01-96 .57 50,992
----- --------
10.05 898,948
----- --------
Broadcasting & Cable T.V.
50,000 Cox Communications, Inc.
Note 8.875%, 03-01-01 .62 55,828
----- --------
Chemical (Basic) -
30,000 DuPont E. I. Note 8.450%,
10-15-96 .34 30,717
----- --------
Chemical (Diversified) -
80,000 ICI Wilmington
Note 9.500%, 11-15-00 1.02 91,090
----- --------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Diversified Company -
$ 70,000 ITT Corp.
Note 9.875%, 04-15-97 .82% $ 73,380
30,000 ITT Corp.
Deb. 10.125%, 04-05-99 .37 33,459
50,000 ITT Corp.
Deb. 9.375%, 12-15-01 .64 56,984
50,000 United Technology Corp.
Note 9.625%, 05-15-99 .57 50,977
---- -------
2.40 214,800
---- -------
Drug -
30,000 Merck & Company
Note 7.750%, 05-01-96 .34 30,248
---- -------
Electric Equipment -
50,000 General Electric Capital
Corp. Note 8.750%,
11-26-96 .58 51,430
---- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Electric Utility -
$ 50,000 Alabama Power Company
1st Mortgage
8.300%, 07-01-22 .59% $ 52,781
50,000 Duke Power Company
1st Ref & Mortgage
8.625%, 03-01-22 .61 54,547
250,000 Iowa Electric Light
1st Mortgage
6.25%, 09-01-96 2.80 250,037
206,000 Iowa Electric Light
1st Ref & Mortgage
7.625%, 05-01-02 2.35 210,151
35,000 Mississippi Power & Light Co.
General Ref Mortgage
8.500%, 01-05-23 .45 39,837
100,000 Ohio Power Co.
Note 6.875%, 06-01-03 1.16 103,459
65,000 Southern Calif. Edison Co.
1st Mortgage
8.875%, 06-01-24 .76 68,400
70,000 Teco Energy
Note 9.220%, 10-15-97 .83 74,227
100,000 Virginia Electric & Power Co.
Note 9.45%, 05-20-96 1.18 105,569
100,000 Wisconsin Pwr & Lt Company
1st Mortgage
9.30%, 12-01-25 1.18 105,984
----- ---------
11.91 1,064,992
----- ---------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Food Processing -
$100,000 Quaker Oats Co.
Medium-Term
Note 9.000%, 12-17-01 1.27% $ 113,594
---- ---------
Insurance (Diversified) -
40,000 Aetna Life & Casualty Co.
Note 8.625%, 03-01-98 .47 42,200
80,000 Cigna Corp.
Note 8.000%, 09-01-96 .91 81,162
200,000 CIT Group Holdings Inc.
Note 5.875%, 12-01-95 2.24 200,000
---- -------
3.62 323,362
---- -------
Machinery (Construction &
Mining) -
200,000 Caterpillar Inc.
Note 6.810%, 08-24-99 2.29 205,044
250,000 Deere & Co.
Note 8.250%, 06-01-96 2.83 252,970
---- -------
5.12 458,014
---- -------
Metals & Mining (Diversified)-
50,000 Alcan Aluminum Ltd
Deb. 9.700%, 10-15-96 .58 51,633
---- -------
Natural Gas Industry -
100,000 British Gas Co.
Note 8.750%, 03-15-98 1.19 106,093
---- -------
Office Equipment & Supplies -
195,000 Xerox Corp. Note
9.200%, 07-15-99 2.23 199,448
---- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Paper and Forest Products -
$ 50,000 International Paper Company
Deb. 9.700%, 03-15-00 .64% $ 56,859
---- -------
Petroleum (Integrated) -
70,000 Pennzoil Co. Note 9.625%,
11-15-99 .88 78,203
---- -------
Precision Instrument Industry -
25,000 Eastman Kodak Companies
Note 10.000%, 06-15-01 .29 25,637
---- -------
Retail Store Industry -
50,000 Dayton Hudson Corp. Note
10.000%, 12-01-00 .65 57,930
100,000 Sears Roebuck Accept
9.600%, 05-21-97 1.26 113,050
30,000 Sears Roebuck & Co. Note
9.250%, 08-01-97 .35 31,617
30,000 Wal Mart Stores Note
9.100%, 07-15-00 .38 33,801
30,000 Wal Mart Stores Note
8.000%, 05-01-96 .34 30,276
---- -------
2.98 266,674
---- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Securities Brokerage Industry -
$ 35,000 Bear Stearns Companies Note
9.375%, 06-01-01 .45% $ 40,004
50,000 Lehman Bros Holdings Inc Note
7.625%, 06-15-97 .57 51,085
100,000 Lehman Bros Inc Sr Sub Note
7.000%, 05-15-97 1.13 101,265
200,000 Lehman Bros Holding Inc. Note
8.500%, 05-01-07 2.49 222,468
50,000 Morgan Stanley Group Note
8.000%, 10-15-96 .57 50,852
40,000 Morgan Stanley Group Note
7.875%, 12-15-98 .47 41,977
30,000 Morgan Stanley Group Note
8.100%, 06-24-02 .37 32,883
30,000 Salomon Inc. Note
8.600%, 05-15-96 .34 30,295
100,000 Salomon Inc. Note
9.500%, 07-01-97 1.17 104,604
100,000 Salomon Inc. Note
7.05%, 01-15-98 1.16 104,050
40,000 Salomon Inc. Note
9.100%, 03-15-98 .47 42,197
100,000 Salomon Inc. Note
7.250%, 01-15-00 1.14 101,593
----- -------
10.33 923,273
----- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
Corporate Bonds & Notes
Semiconductor -
$150,000 Texas Instruments Note
9.000%, 07-15-99 1.71% $ 153,140
---- ---------
Telecommunications Service
Industry -
50,000 General Telephone Co. Florida
1st Mortgage,
7.500%, 08-01-02 .57 50,906
200,000 GTE Hawaiian Telephone, Inc.
1st Mortgage,
9.000%, 12-01-00 2.28 203,250
103,000 General Telephone Co Kentucky
1st Mortgage,
7.750, 06-01-03 1.17 104,802
100,000 Illinois Bell Telephone Co.
Deb. 8.500%, 04-22-26 1.17 104,890
250,000 U.S. West Capital Funding,
Inc., Note,
6.750%, 10-01-05 2.84 254,062
---- --------
8.03 717,910
---- --------
Tobacco -
40,000 Philip Morris Note
8.875%, 07-01-96 .45 40,650
30,000 Philip Morris Note
8.750%, 12-01-96 .34 30,806
130,000 Philip Morris Note
7.750%, 05-01-99 1.54 137,089
---- --------
2.33 208,545
---- --------
Total Corporate Bonds & Notes
(cost $6,786,170) 75.73 6,770,794
----- ---------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Income Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Par Percent of Market Value
Value Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
U.S. Government Agency
$200,000 Federal Home Loan Bank
8.23%, 07-19-04 2.29% $ 204,560
200,000 Federal Home Loan Bank
9.12%, 01-23-05 2.25 200,940
200,000 Federal Home Loan Mtge. Corp.
6.75%, 05-06-96 2.26 202,140
100,000 Federal Home Loan Mtge. Corp.
8.07%, 04-12-02 1.13 100,859
80,000 Federal Home Loan Mtge. Corp.
8.325%, 07-15-09 .96 85,872
200,000 Federal Natl. Mtge. Assn. Deb.
8.400%, 10-25-04 2.42 216,820
200,000 Federal Natl. Mtge. Assn. Deb.
7.920%, 03-30-0S 2.40 214,750
------ ----------
Total U.S. Government Agency
(cost $1,210,212) 13.71 1,225,941
------ ----------
U.S. Government Securities
650,000 U.S. Treasury Notes
5.875%, 02-15-04 7.33 655,285
------ ----------
Total U.S. Government Securities
(cost $645,422)
Total Investments
(cost $8,641,804) (A) 96.77 8,652,020
Other Assets Less Liabilities 3.23 288,438
------ ----------
Net Assets 100.00% $8,940,458
====== ==========
</TABLE>
<TABLE>
(A) Aggregate cost for federal income tax
purposes is $8,641,804.
At November 30, 1995, unrealized appreciation
(depreciation) of securities for federal income
tax purposes is as follows:
<S> <C>
Unrealized appreciation $ 124,916
Unrealized depreciation ( 114,700)
---------
Net unrealized appreciation $ 10,216
---------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Diversified Management Portfolio
PORTFOLIO OF INVESTMENTS
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
General Equity Funds
Aggressive Growth -
1084 Strong Opportunity 3.83% $ 36,889
1336 Twentieth Century Ultra 3.93 37,808
1514 Wasatch Aggressive Equity 3.77 36,228
----- -------
11.53 110,925
----- -------
Balanced -
1005 Columbia Balanced 2.15 20,643
479 Dodge & Cox Balanced 2.75 26,484
----- -------
4.90 47,127
----- -------
Corporate - High Yield -
2860 Federated High Yield Trust 2.65 25,535
2155 Fidelity Capital & Income 2.05 19,656
----- -------
4.70 45,191
----- -------
Growth -
858 Fidelity Stock Selection 2.22 21,361
783 Gabelli Asset 2.22 21,381
1181 Harbor Capital Appreciation 2.90 27,943
1221 Longleaf Partners 2.82 27,159
360 Nicholas 2.31 22,209
739 Oakmark 2.32 22,317
1358 Soundshore 2.76 26,563
831 Steinroe Special 2.19 21,029
----- -------
19.74 189,962
----- -------
Growth/Income -
682 Babson Value 2.25 21,668
316 Dodge & Cox Stock 2.28 21,966
705 Mutual Beacon 2.79 26,791
1123 Neuberger & Berman Guardian 2.81 27,063
1525 Pelican 2.26 21,734
----- -------
12.39 119,222
----- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Diversified Management Portfolio
PORTFOLIO OF INVESTMENTS
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
General Equity Funds - continued
Income -
1909 Berwyn Income 2.44% $ 23,503
867 Lindner Dividend 2.45 23,558
---- ------
4.89 47,061
---- ------
Small Company -
1139 Columbia Special 2.82 27,124
888 Heartland Value 2.69 25,866
1044 Meridian 3.26 31,332
1277 PBHG Growth 3.09 29,719
899 Parkstone Small Cap.
Series "B" 2.81 27,072
1069 Warburg Pincus Emerging
Growth 3.41 32,850
----- -------
18.08 173,963
----- -------
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Diversified Management Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<C> <S> <C> <C>
International Equity Funds
Foreign Equity -
568 Managers International
Equity 2.44% $ 23,485
3077 Twentieth Century
International Equity 2.40 23,110
------ ---------
4.84 46,595
------ ---------
Global Equity -
1156 Founders Worldwide Growth 2.43 23,344
844 Janus Worldwide Fund 2.49 23,989
------ ---------
4.92 47,333
------ ---------
International Bond -
1981 T. Rowe Price Intern. Bond 2.15 20,678
2011 Scudder Intern. Bond 2.38 22,925
------ ---------
4.53 43,603
------ ---------
Pacific Equity -
2662 T. Rowe Price - New Asia 2.20 21,132
------ ---------
Total Mutual Funds
(cost $843,166) 92.72% $ 892,114
------ ---------
Total Investments
(cost $843,166) (A) 92.72% $ 892,114
------ ---------
Other Assets Less Liabilities 7.28 70,024
------ ---------
Net Assets 100.00% $ 962,138
====== =========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Diversified Management Portfolio
PORTFOLIO OF INVESTMENTS
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
Number of Percent of Market Value
Shares Investments Net Assets (Note 1-A)
<S> <C>
International Equity Funds - continued
(A) Aggregate cost for federal income tax purposes is $843,166.
At November 30, 1995 unrealized appreciation
(depreciation) of securities for federal income
tax purposes is as follows:
Unrealized appreciation $ 50,854
Unrealized depreciation ( 1,906)
-------
Net unrealized appreciation $ 48,948
========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1995
<TABLE>
<CAPTION>
GROWTH INCOME DIVERSIFIED
ASSETS PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
Investments at market value $6,396,293 $8,652,020 $ 892,114
(Identified cost $6,168,180,
$8,641,804 and $843,166,
respectively)
Cash 301,026 93,022 70,027
Receivable for:
Interest 71,353 196,198 --
Dividends 3,910 -- --
---------- ---------- ----------
Total assets 6,772,582 8,941,240 962,141
---------- ---------- ----------
LIABILITIES
Investment Securities Payable 226,790 -- --
Accrued expenses 867 782 3
---------- ---------- ----------
Total liabilities 227,657 782 3
---------- ---------- ----------
NET ASSETS (500 million shares
of $.01 par value common stock
authorized; 575,419, 807,034 and
89,859 shares outstanding,
respectively) $6,544,925 $8,940,458 $ 962,138
========== ========== ==========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
STATEMENT OF ASSETS AND LIABILITIES
(Continued)
November 30, 1995
<TABLE>
<CAPTION>
GROWTH INCOME DIVERSIFIED
PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
Net asset value, offering and
redemption price per share (Net
assets/shares outstanding) $ 11.37 $ 11.08 $ 10.71
=========== =========== ===========
At November 30, 1995 net assets
consisted of:
Paid-in capital $ 5,862,196 $ 8,530,045 $ 913,427
Accumulated undistributed net
investment income (loss) 171,102 464,696 (396)
Accumulated undistributed net
realized gains (losses) 283,515 (64,499) 159
Net unrealized appreciation
of investments 228,112 10,216 48,948
----------- ----------- -----------
$ 6,544,925 $ 8,940,458 $ 962,138
=========== =========== ===========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
STATEMENT OF OPERATIONS
For the Year or Period Ended November 30, 1995
<TABLE>
<CAPTION>
GROWTH INCOME DIVERSIFIED
PORTFOLIO PORTFOLIO PORTFOLIO*
<S> <C> <C> <C>
INVESTMENT INCOME
Interest income $ 249,349 $ 611,468 $ 5,500
Dividend income 51,610 -- 3,007
Other income -- 1,559 575
--------- --------- ---------
Total investment income 300,959 613,027 $ 9,082
--------- --------- ---------
Expenses
Investment advisory fees (Note 2) 60,261 46,815 4,534
Custodian fees 4,900 5,321 --
Legal and audit fees 19,411 19,711 1,000
Reports to shareholders 716 539 --
Registration 1,650 2,830 1,500
Insurance 1,200 1,443 --
Directors expenses 3,000 3,000 --
Miscellaneous expenses -- -- 303
Transfer agent fees (Note 2) 26,507 31,846 2,141
--------- --------- ---------
Total expenses 117,645 111,505 9,478
--------- --------- ---------
Net investment income 183,314 501,522 (396)
--------- --------- ---------
REALIZED AND UNREALIZED GAIN(LOSS)
ON INVESTMENTS
Net realized gain (loss) from
security transactions 283,957 (28,399) 159
Increase in unrealized
appreciation of investments 212,856 278,509 48,948
--------- --------- ---------
Net gain on investments 496,813 250,110 49,107
--------- --------- ---------
Net increase in net
assets resulting from
operations $ 680,127 $ 751,632 $ 48,711
========= ========= =========
</TABLE>
* Commencement of operations was April 3, 1995
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
CROWLEY GROWTH PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
11-30-95 11-30-94
<S> <C> <C>
OPERATIONS
Net investment income $ 183,314 $ 55,064
Net realized gain from
security transactions 283,957 206,538
Net increase in unrealized
appreciation of investments 212,856 93,745
----------- -----------
Net increase in net assets
resulting from operations 680,127 355,347
DISTRIBUTIONS TO SHAREHOLDERS
Distributions from net investment income
($.12 and $.11 per share) (61,711) (48,175)
Distributions from net realized gains on
investments ($.40 and $.40 per share) (205,702) (175,180)
CAPITAL SHARE TRANSACTIONS (a)
Increase in net assets resulting
from capital share transactions 635,837 781,846
----------- -----------
Total increase in net assets 1,048,551 913,838
NET ASSETS
Beginning of period 5,496,374 4,582,536
----------- -----------
End of period (including undistributed
net investment income of $171,102 and
$49,499) $ 6,544,925 $ 5,496,374
=========== ===========
</TABLE>
(a) Summary of capital share activity follows:
<TABLE>
<CAPTION>
Year Ended Year Ended
11-30-95 11-30-94
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
Shares sold 81,977 $ 881,682 79,596 $ 827,304
Shares issued on
reinvestment of
distributions 26,529 267,413 21,897 223,355
Shares redeemed (47,196) (513,258) (25,844) ( 268,813)
------- -------- ------- ---------
Net increase 61,310 $ 635,837 75,649 $ 781,846
====== ========= ====== =========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
CROWLEY INCOME PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
11-30-95 11-30-94
<S> <C> <C>
OPERATIONS
Net investment income $ 501,522 $ 373,872
Net realized loss from
security transactions (28,399) (36,099)
Net increase(decrease) in
unrealized appreciation of
investments 278,509 (426,418)
----------- -----------
Net increase (decrease) in net assets
resulting from operations 751,632 (88,645)
DISTRIBUTIONS TO SHAREHOLDERS
Distributions from net investment income
($.63 and $.66 per share) (385,139) (312,989)
Distributions from net realized gains on
investments ($.07 per share) ( - ) (31,705)
CAPITAL SHARE TRANSACTIONS (a)
Increase in net assets
resulting from capital share
transactions 1,919,980 1,664,792
----------- -----------
Total increase in net assets 2,286,473 1,231,453
NET ASSETS
Beginning of period 6,653,985 5,422,532
----------- -----------
End of period (including undistributed
net investment income of $464,696 and
$348,313) $8,940,458 $6,653,985
========== ==========
</TABLE>
(a) Summary of capital share activity follows:
<TABLE>
<CAPTION>
Year Ended Year Ended
11-30-95 11-30-94
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
Shares sold 237,444 $ 2,505,734 155,350 $ 1,680,042
Shares issued on
reinvestment of
distributions 38,170 385,139 31,565 344,694
Shares redeemed (91,003) (970,893) (33,129) (359,944)
------- -------- ------- --------
Net increase 184,611 $ 1,919,980 153,786 $ 1,664,792
======= =========== ======= ===========
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For Eight Months
Ended 11-30-95*
<S> <C>
OPERATIONS
Net investment loss $ (396)
Net realized gain(loss)from
security transactions 159
Net increase in unrealized
appreciation of investments 48,948
---------
Net increase (decrease) in net assets
resulting from operations 48,711
CAPITAL SHARE TRANSACTIONS (a)
Increase in net assets resulting
from capital share transactions 913,427
---------
Total increase in net assets 962,138
NET ASSETS
Beginning of period --
End of period (including accumulated
net investment loss of 396) $ 962,138
=========
</TABLE>
(a) Summary of capital share activity follows:
<TABLE>
<CAPTION>
Eight Months Ended
11-30-95
Shares Amount
<S> <C> <C>
Shares sold 91,820 $ 933,857
Shares redeemed (1,961) (20,430)
------ -------
Net increase 89,859 913,427
====== =======
</TABLE>
*Commencement of operations was April 3, 1995
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
Crowley Growth Portfolio
Financial Highlights
<TABLE>
<CAPTION>
12-01-94 12-01-93
to to
11-30-95 11-30-94
<S> <C> <C>
Net asset value
Beginning of period $ 10.69 $ 10.45
------------ ------------
Income from investment
operations
Net investment income .32 .12
Net gains
on securities (both
realized & unrealized) .88 .63
------------ ------------
Total from investment
operations 1.20 .75
------------ ------------
Less Distributions
Dividends (from net
investment income) (.12) (.11)
Distributions (from
realized capital gains) (.40) (.40)
Return of capital ( - ) ( - )
------------ ------------
Total distributions (.52) (.51)
Net asset value
End of period $ 11.37 $ 10.69
============ ============
Total return 11.85% 7.41%
Ratios/supplemental data:
Net assets end of period
(000 omitted) 6,545 5,496
Ratio of expenses to
average net assets 1.93% 1.85%
(b)
Ratio of net
investment income to
average net assets 3.00% 1.10%
(b)
Portfolio turnover rate 118.08% 107.37%
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
Crowley Growth Portfolio
Financial Highlights
<TABLE>
<CAPTION>
12-01-92 12-01-91 12-01-90 12-06-89(a)
to to to to
11-30-93 11-30-92 11-30-91 11-30-90
<S> <C> <C> <C> <C>
Net asset value
Beginning of period $10.19 $9.94 $9.39 $10.00
------ ----- ----- ------
Income from investment
operations
Net investment income .11 .17 .33 .32
Net gains or losses
on securities (both
realized & unrealized) .18 .32 1.06 (.61)
------ ----- ----- ------
Total from investment
operations .29 .49 1.39 (.29)
------ ----- ----- ------
Less Distributions
Dividends (from net
investment income) (.03) (.17) (.33) (.32)
Distributions (from
realized capital gains) ( - ) (.07) (.50) ( - )
Return of capital ( - ) ( - ) (.01) ( - )
------ ----- ----- ------
Total distributions (.03) (.24) (.84) (.32)
Net asset value
End of period $10.45 $10.19 $ 9.94 $9.39
====== ====== ====== =====
Total return 2.85% 4.93% 14.85% ( 2.90%)
Ratios/supplemental data:
Net assets end of period
(000 omitted) 4,583 4,440 3,283 1,653
Ratio of expenses to
average net assets 1.61% 1.52% 1.89% 1.00%
(b)(c)
Ratio of Net
investment income to
to average net assets 1.00% 1.72% 3.64% 4.49%
(b)(c)
Portfolio turnover rate 243.85% 178.78% 74.86% 110.61%
<FN>
(a) Effective date of the Fund's initial registration under the Securities Act
of 1933, as amended.
(b) Annualized.
(c) The ratio of operating expenses and net income before reimbursement of
expenses by the advisor were 2.00% and 3.49%, respectively.
</FN>
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
Crowley Income Portfolio
Financial Highlights
<TABLE>
<CAPTION>
12-01-94 12-01-93
to to
11-30-95 11-30-94
<S> <C> <C>
Net asset value
Beginning of period $10.69 $11.57
------ ------
Income from investment
operations
Net investment income .65 .61
Net gains (losses)
on securities (both
realized & unrealized) .37 (.76)
------ ------
Total from investment
operations 1.02 (.15)
------ ------
Less Distributions
Dividends (from net
investment income) (.63) (.66)
Distributions (from
realized capital gains) ( - ) (.07)
Return of capital ( - ) ( - )
------ ------
Total distributions (.63) (.73)
Net asset value
End of period $11.08 $10.69
====== ======
Total return 10.12% (1.43)%
Ratios/supplemental data:
Net assets end of period
(000 omitted) 8,940 6,654
Ratio of expenses to
average net assets 1.43% 1.37%
(b)
Ratio of net
investment income to
average net assets 6.43% 6.28%
(b)
Portfolio turnover rate 31.60% 14.45%
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
Crowley Income Portfolio
Financial Highlights
<TABLE>
<CAPTION>
12-01-92 12-01-91 12-01-90 12-06-89(a)
to to to to
11-30-93 11-30-92 11-30-91 11-30-90
<S> <C> <C> <C> <C>
Net asset value
Beginning of period $10.58 $10.48 $10.19 $10.00
------ ------ ------ ------
Income from investment
operations
Net investment income .65 .61 .67 .58
Net gains (losses)
on securities (both
realized & unrealized) .40 .22 .43 .23
------ ------ ------ ------
Total from investment
operations 1.05 .83 1.10 .81
------ ------ ------ ------
Less Distributions
Dividends (from net
investment income) (.06) (.61) (.67) (.58)
Distributions (from
realized capital gains) ( - ) (.12) (.13) (.04)
Return of capital ( - ) ( - ) (.01) ( - )
------ ------ ------ ------
Total distributions (.06) (.73) (.81) (.62)
Net asset value
End of period $11.57 $10.58 $10.48 $10.19
====== ====== ====== ======
Total return 9.97% 7.96% 10.88% 8.10%
Ratios/supplemental data:
Net assets end of period
(000 omitted) 5,423 4,133 2,865 1,397
Ratio of expenses to
average net assets 1.23% 1.20% 1.09% .99%
(c) (b)(c)
Ratio of Net
investment income to
average net assets 6.27% 6.11% 6.78% 7.10%
(c) (b)(c)
Portfolio turnover rate 19.17% 45.00% 79.36% 48.74%
<FN>
(a) Effective date of the Fund's initial registration under the Securities Act
of 1933, as amended.
(b) Annualized.
(c) The ratio of operating expenses and net income before reimbursement of
expenses by the advisor were 1.37% and 6.49%, respectively for 1991 and
1.61% and 6.48%, respectively for 1990.
</FN>
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
Crowley Diversified Management Portfolio
Financial Highlights
<TABLE>
<CAPTION>
Eight Months
04-01-95(a)
to
11-30-95
<S> <C>
Net asset value
Beginning of period $10.00
------
Income from investment
operations
Net investment income --
Net gains (losses)
on securities (both
realized & unrealized) .71
------
Total from investment
operations .71
------
Less Distributions
Dividends (from net
investment income) --
Distributions (from
realized capital gain --
Return of capital --
Total distributions --
Net asset value
End of period $10.71
======
Total return 7.1%
Ratios/supplemental data:
Net assets end of period
(000 omitted) 962
Ratio of expenses to
average net assets 2.06%
(b)
Ratio of net
investment loss
to average net assets (.09)%
(b)
Portfolio turnover rate --
<FN>
(a) Effective date of Portfolio's initial registration statement under the
Securities Act of 1933, as amended.
(b) Annualized.
</FN>
</TABLE>
See accompanying notes to financial statements
<PAGE>
The Crowley Portfolio Group, Inc.
NOTES TO FINANCIAL STATEMENTS
November 30, 1995
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Crowley Portfolio Group, Inc. (the "Fund") is an open-end
diversified investment company currently offering three series of
shares: The Crowley Growth Portfolio, The Crowley Income
Portfolio, and The Crowley Diversified Management Portfolio (each
a "Portfolio").
The objective of The Crowley Growth Portfolio is long-term growth
of capital for investors, with the secondary objective being
current income. The objective of The Crowley Income Portfolio is
to maximize current income, consistent with prudent risk i.e.
reasonable risk to principal. The objective of The Crowley
Diversified Management Portfolio is high total return consistent
with reasonable risk. The Portfolios will use a variety of
investment strategies in an effort to balance portfolio risks and
to hedge market risks. There can be no assurance that the
objectives of the Portfolios will be achieved.
(A) SECURITY VALUATION
Portfolio securities, which are fixed income securities, are
valued by using market quotations, prices provided by
market-makers, or estimates of market values obtained from yield
data relating to instruments or securities with similar
characteristics, in accordance with procedures established in
good faith by the Board of Directors.
<PAGE>
The Crowley Portfolio Group, Inc.
NOTES TO FINANCIAL STATEMENTS
(Continued)
November 30, 1995
Securities listed on an exchange or quoted on a national market
system are valued at the last sales price. Investments in
regulated investment companies are valued at the net asset value
per share as quoted by the National Association of Securities
Dealers. Money market securities with remaining maturates of less
than 60 days are valued on the amortized cost basis as reflecting
fair value. All other securities are valued at their fair value
as determined in good faith by the Board of Directors.
(B) FEDERAL INCOME TAXES
The Portfolios intend to comply with the requirements of the
Internal Revenue Code necessary to qualify as regulated
investment companies and as such will not be subject to federal
income taxes on otherwise taxable income (including net realized
capital gains) which is distributed to shareholders. At November
30, 1995, the Income Portfolio had a capital loss carryforward
for Federal Income Tax purposes of approximately $64,500 of which
$36,100 expires in 2002 and $28,400 in 2003.
(C) SECURITY TRANSACTIONS, INVESTMENT INCOME AND
DISTRIBUTIONS TO SHAREHOLDERS
As is common in the industry, security transactions are accounted
for on the trade date (the date the securities are purchased or
sold). Interest income is recorded on the accrual basis. Bond
premiums and discounts are amortized in accordance with Federal
Income Tax regulations. Dividend income and distributions to
shareholders are recorded on the ex-dividend date.
<PAGE>
The Crowley Portfolio Group, Inc.
NOTES TO FINANCIAL STATEMENTS
(Continued)
November 30, 1995
(D) USE OF ESTIMATES IN FINANCIAL STATEMENTS
In preparing financial statements in conformity with generally
accepted accounting principles, management makes estimates and
assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements, as well as
the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those
estimates.
NOTE 2 - INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Crowley & Crowley Corp. provides the Fund with management and
administrative services pursuant to a management agreement.
As compensation for its services, the Advisor receives a fee,
computed daily and payable monthly, at the annualized rate of 1% of
the average daily net assets of The Crowley Growth Portfolio, .60% of
the average daily net assets of The Crowley Income Portfolio and 1% of
the average daily net assets of Th Crowley Diversified Management
Portfolio. The Advisor pays all expenses incurred by it in rendering
management services to the Fund including the costs of accounting,
bookkeeping and data processing services provided in its role as
administrator. The Portfolios bear their costs of operations, which
include, but are not limited to: advisory fees; taxes; brokerage fees;
accounting fees; legal fees; custodian and auditing fees; and printing
and other expenses which are not expressly assumed by the Advisor
under the Management Contracts.
<PAGE>
The Crowley Portfolio Group, Inc.
NOTES TO FINANCIAL STATEMENTS
(continued)
November 30, 1995
The Crowley Financial Group, Inc. ("TCFG") serves as the
portfolio shareholders' servicing agent. As shareholder servicing
agent, TCFG, will act as the Transfer, Dividend Disbursing and
Redemption Agent to the Portfolios. As compensation for its services,
TCFG receives a fee computed daily and payable monthly, at the
annualized rate of .40% of the average daily net assets of each
Portfolio. During the period December 1, 1994 to November 30, 1995,
TCFG earned fees of $26,507, $31,846 and $2,141 from the Growth,
Income, and Diversified Management Portfolios, respectively.
Crowley Securities serves as distributor of the Fund's shares.
Effective August 1, 1994, the sales load was eliminated on the sale of
all shares.
Certain officers and directors of the Fund are also officers of
Crowley & Crowley Corp. and The Crowley Financial Group, Inc.
NOTE 3 - PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities, other than short-term
investments, aggregated $6,817,577 and $5,036,836, respectively, in
the Growth Portfolio, $5,008,574 and $2,308,883, respectively, in the
Income Portfolio and $843,166 and no sales, respectively, in the
Crowley Diversified Management Portfolio.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information for The Crowley Growth
Portfolio for the November 30, 1995 Annual Report.
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> THE CROWLEY GROWTH AND INCOME PORTFOLIO
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> NOV-30-1995
<PERIOD-END> NOV-30-1995
<INVESTMENTS-AT-COST> 6,168,180
<INVESTMENTS-AT-VALUE> 6,396,293
<RECEIVABLES> 75,263
<ASSETS-OTHER> 301,026
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 6,772,582
<PAYABLE-FOR-SECURITIES> 226,790
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 867
<TOTAL-LIABILITIES> 227,657
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 5,862,196
<SHARES-COMMON-STOCK> 575,419
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 171,102
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 283,515
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 228,112
<NET-ASSETS> 6,544,925
<DIVIDEND-INCOME> 51,610
<INTEREST-INCOME> 249,349
<OTHER-INCOME> 0
<EXPENSES-NET> 117,645
<NET-INVESTMENT-INCOME> 183,314
<REALIZED-GAINS-CURRENT> 283,957
<APPREC-INCREASE-CURRENT> 212,856
<NET-CHANGE-FROM-OPS> 680,127
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (61,711)
<DISTRIBUTIONS-OF-GAINS> (205,702)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 81,977
<NUMBER-OF-SHARES-REDEEMED> 47,196
<SHARES-REINVESTED> 26,529
<NET-CHANGE-IN-ASSETS> 1,048,551
<ACCUMULATED-NII-PRIOR> 49,499
<ACCUMULATED-GAINS-PRIOR> 205,260
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 60,261
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 117,645
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 10.69
<PER-SHARE-NII> .32
<PER-SHARE-GAIN-APPREC> .88
<PER-SHARE-DIVIDEND> (.12)
<PER-SHARE-DISTRIBUTIONS> (.40)
<RETURNS-OF-CAPITAL> .00
<PER-SHARE-NAV-END> 11.37
<EXPENSE-RATIO> 1.93
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information for The Crowley
Income Portfolio for the November 30, 1995 annual report.
</LEGEND>
<SERIES>
<NUMBER> 2
<NAME> THE CROWLEY INCOME PORTFOLIO
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> NOV-30-1995
<PERIOD-END> NOV-30-1995
<INVESTMENTS-AT-COST> 8,641,804
<INVESTMENTS-AT-VALUE> 8,652,020
<RECEIVABLES> 196,198
<ASSETS-OTHER> 93,022
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 8,941,240
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 782
<TOTAL-LIABILITIES> 782
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 8,530,045
<SHARES-COMMON-STOCK> 807,034
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 464,696
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (64,499)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 10,216
<NET-ASSETS> 8,940,458
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 611,468
<OTHER-INCOME> 1,559
<EXPENSES-NET> 111,505
<NET-INVESTMENT-INCOME> 501,522
<REALIZED-GAINS-CURRENT> (28,399)
<APPREC-INCREASE-CURRENT> 278,509
<NET-CHANGE-FROM-OPS> 751,632
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (385,139)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 237,444
<NUMBER-OF-SHARES-REDEEMED> 91,003
<SHARES-REINVESTED> 38,170
<NET-CHANGE-IN-ASSETS> 2,286,473
<ACCUMULATED-NII-PRIOR> 348,313
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 36,099
<GROSS-ADVISORY-FEES> 46,815
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 111,505
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 10.69
<PER-SHARE-NII> .65
<PER-SHARE-GAIN-APPREC> .37
<PER-SHARE-DIVIDEND> (.63)
<PER-SHARE-DISTRIBUTIONS> .00
<RETURNS-OF-CAPITAL> .00
<PER-SHARE-NAV-END> 11.08
<EXPENSE-RATIO> 1.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information for The Crowley
Diversified Management Portfolio for the November 30, 1995 annual report.
</LEGEND>
<SERIES>
<NUMBER> 3
<NAME> THE CROWLEY DIVERSIFIED MANAGEMENT PORTFOLIO
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> NOV-30-1995
<PERIOD-END> NOV-30-1995
<INVESTMENTS-AT-COST> 843,166
<INVESTMENTS-AT-VALUE> 892,114
<RECEIVABLES> 0
<ASSETS-OTHER> 70,027
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 962,141
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3
<TOTAL-LIABILITIES> 3
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 913,427
<SHARES-COMMON-STOCK> 89,859
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (396)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 159
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 48,948
<NET-ASSETS> 962,138
<DIVIDEND-INCOME> 3,007
<INTEREST-INCOME> 5,500
<OTHER-INCOME> 575
<EXPENSES-NET> 9,478
<NET-INVESTMENT-INCOME> (396)
<REALIZED-GAINS-CURRENT> 159
<APPREC-INCREASE-CURRENT> 48,948
<NET-CHANGE-FROM-OPS> 48,711
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 91,820
<NUMBER-OF-SHARES-REDEEMED> 1,961
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 962,138
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,534
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 9,478
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .00
<PER-SHARE-GAIN-APPREC> .71
<PER-SHARE-DIVIDEND> .00
<PER-SHARE-DISTRIBUTIONS> .00
<RETURNS-OF-CAPITAL> .00
<PER-SHARE-NAV-END> 10.71
<EXPENSE-RATIO> 2.06
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
