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[Logo]
757 THIRD AVENUE
NEW YORK, NEW YORK 10017
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A NO-LOAD MUTUAL FUND
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PROSPECTUS
Investment Adviser
Cohen & Steers Capital Management, Inc.
757 Third Avenue
New York, New York 10017
Telephone: (212) 832-3232
Transfer Agent
Chase Global Funds Services Company
P.O. Box 2798
Boston, Massachusetts 02208-2798
Telephone: (800) 437-9912
AS WITH ALL MUTUAL FUNDS, THE SECURITIES AND EXCHANGE COMMISSION HAS NOT
APPROVED OR DISAPPROVED OF THE FUND'S SHARES OR DETERMINED WHETHER THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANYONE WHO INDICATES OTHERWISE
IS COMMITTING A CRIME.
MAY 1, 1999
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TABLE OF CONTENTS
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RISK/RETURN SUMMARY............................................................................ 1
Investment Objective and Principal Investment Strategies................................. 1
Who Should Invest........................................................................ 1
Principal Risks.......................................................................... 1
Historical Fund Performance.............................................................. 2
FEES AND EXPENSES OF THE FUND.................................................................. 3
INVESTMENT OBJECTIVE, PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS........................ 4
Objective................................................................................ 4
Principal Investment Strategies.......................................................... 4
Principal Risks of Investing in the Fund................................................. 5
MANAGEMENT OF THE FUND......................................................................... 6
The Investment Adviser................................................................... 6
Portfolio Managers....................................................................... 7
PURCHASES AND REDEMPTIONS...................................................................... 7
Pricing of Shares........................................................................ 7
Purchase Minimums........................................................................ 7
Form of Payment.......................................................................... 8
Purchases of Shares...................................................................... 8
Exchange Privilege....................................................................... 9
Redemptions of Shares.................................................................... 9
ADDITIONAL INFORMATION......................................................................... 10
Shareholder Services Plan................................................................ 10
Dividends and Distributions.............................................................. 11
Tax Considerations....................................................................... 11
FINANCIAL HIGHLIGHTS........................................................................... 12
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COHEN & STEERS REALTY SHARES, INC.
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RISK/RETURN SUMMARY
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INVESTMENT OBJECTIVE AND PRINCIPAL INVESTMENT STRATEGIES
The Fund's investment goal is total return through investment in real estate
securities. In pursuing total return, the Fund equally emphasizes both capital
appreciation and current income.
Normally, the Fund invests substantially all of its assets in common stocks and
other equity securities issued by real estate companies, such as 'real estate
investment trusts' ('REITs'). A real estate company generally derives at least
50% of its revenue from real estate or has at least 50% of its assets in real
estate. A REIT is a company dedicated to owning, and usually operating, income
producing real estate, or to financing real estate. The Fund's investment
portfolio includes shares of Equity REITs, which are companies that invest the
majority of their assets directly in real property and derive income primarily
from the collection of rents. Equity REITs can also realize capital gains by
selling properties that have appreciated in value. REITs are not taxed on income
distributed to shareholders provided they comply with the requirements of the
Internal Revenue Code.
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WHO SHOULD INVEST
Cohen & Steers Realty Shares may be suitable for you if you are seeking:
Some exposure to real estate to add to your portfolio mix;
A fund that may perform differently than a general stock or bond fund to add to
your portfolio;
Liquidity in a real estate-related investment;
High current income; and
The potential for long-term capital growth.
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PRINCIPAL RISKS
Investment Risk. An investment in the Fund is subject to investment risk,
including the possible loss of the entire principal amount that you invest.
Stock Market Risk. Your investment in Fund shares represents an indirect
investment in the REIT shares and other real estate securities owned by the
Fund. The value of these equity securities, like other stock market investments,
may move up or down, sometimes rapidly and unpredictably. Your Fund shares at
any point in time may be worth less than what you invested, even after taking
into account the reinvestment of Fund dividends and distributions.
Real Estate Market and REIT Risk. Additionally, since the Fund concentrates its
assets in the real estate industry, your investment in the Fund will be closely
linked to the performance of the real estate markets. Property values may fall
due to increasing vacancies or declining rents resulting from unanticipated
economic, legal, cultural or technological developments. REIT prices also
may drop because of the failure of borrowers to pay their loans and poor
management.
Smaller Companies. Even the larger REITs in the industry tend to be small to
medium-sized companies in relation to the equity markets as a whole. REIT shares
therefore can be more volatile than, and perform differently from, larger
company stocks.
Less Diversification. As a 'non-diversified' investment company, the Fund can
invest in fewer individual companies than a diversified investment company.
Because a concentrated portfolio is more likely to experience large market price
fluctuations, the Fund could be subject to a greater risk of loss than a
diversified company.
Your investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
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HISTORICAL FUND PERFORMANCE
You should review the following information regarding the past performance of
the Fund. It shows how the Fund's investment return can change from year to year
and how the Fund's returns can vary from the performance of selected broad
market indices over various time periods. This information is intended to give
you some indication of the risk associated with an investment in the Fund. Past
performance is not, however, an indication as to how the Fund may perform in the
future.
THIS CHART SHOWS THE FUND'S TOTAL RETURN FOR EACH YEAR SINCE THE FUND COMMENCED
OPERATIONS.
[PERFORMANCE GRAPH]
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HIGHEST QUARTERLY RETURN DURING THIS PERIOD: 20.5%
LOWEST QUARTERLY RETURN DURING THIS PERIOD: - 11.9%
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THIS TABLE SHOWS THE FUND'S AVERAGE ANNUAL TOTAL RETURNS FOR THE PAST ONE AND
FIVE YEARS AND THE PERIOD SINCE THE FUND COMMENCED OPERATIONS, AND COMPARES
THESE RETURNS WITH THE PERFORMANCE OF THREE INDICES.
AVERAGE ANNUAL TOTAL RETURNS
(for periods ended December 31, 1998)
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SINCE
1 YEAR 5 YEARS INCEPTION**
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Cohen & Steers Realty Shares.................................................. - 18.07% 10.60% 13.27%
NAREIT All REIT Index*........................................................ - 18.82% 9.33% 11.40%
Wilshire Real Estate Securities Index*........................................ - 17.43% 9.36% 9.07%
S&P 500'r'*................................................................... 28.58% 28.20% 20.20%
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* The NAREIT Index of All REITs is comprised of 210 real estate investment
trusts. The Wilshire Real Estate Securities Index is comprised of 119
companies operating in the real estate industry and includes REITs. This
Index does not include REITs with investments in health care facilities. The
Fund invests in REITs with health care facilities. The Standard & Poor's 500
Composite Stock Index ('S&P 500') is an unmanaged index of 500 large
capitalization, publicly traded stocks representing a variety of industries.
Performance figures include reinvestment of income dividends and capital
gains distributions. You should note that the Fund is a professionally
managed mutual fund while the indices are unmanaged, do not incur expenses
and are not available for investment.
** The inception date was July 2, 1991.
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FEES AND EXPENSES OF THE FUND
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THIS TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU COULD PAY IF YOU BUY AND
HOLD SHARES OF THE FUND.
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SHAREHOLDER FEES (fees paid directly from your investment): None
ANNUAL FUND OPERATING EXPENSES* (expenses that are deducted
from Fund assets):
MANAGEMENT FEE...................................................................... 0.84%
OTHER EXPENSES
SERVICE FEE*...................................................... 0.05%
OTHER EXPENSES:................................................... 0.20%
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TOTAL OTHER EXPENSES................................................................ 0.25%
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TOTAL ANNUAL FUND OPERATING EXPENSES:**............................................. 1.09%
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* While the Fund has adopted a shareholder services plan, to date the Fund has
not paid any service fees. The Fund's actual 1998 operating expenses,
therefore, were 1.04% of average net assets for the year before expense
reductions from directed brokerage arrangement (see the following footnote).
Shareholders will receive a notice from the Fund before the Fund begins to
pay service fees.
** The investment adviser has directed certain portfolio transactions to brokers
who paid a portion of the Fund's expenses. For the year ended December 31,
1998, the Fund's expenses were reduced by $342,466 under these arrangements.
Although the Fund did not pay these expenses directly, this amount has been
added to the Fund's 'Other Expenses' in accordance with disclosure
regulations. Had these costs not been reflected in the table, the Fund's
total operating expenses would have been 1.08% (1.03% without the service
fees). The Management of the Fund believes these arrangements benefit the
Fund and the Fund's shareholders and intends to continue such arrangements in
the current year.
EXAMPLE
THIS EXAMPLE IS INTENDED TO HELP YOU COMPARE THE COST OF INVESTING IN THE FUND
WITH THE COST OF INVESTING IN OTHER MUTUAL FUNDS. THE EXAMPLE ASSUMES THAT YOU
INVEST $10,000 IN THE FUND FOR THE TIME PERIODS INDICATED AND THEN REDEEM ALL OF
YOUR SHARES AT THE END OF THOSE PERIODS. THE EXAMPLE ALSO ASSUMES THAT YOUR
INVESTMENT HAS A 5% RETURN EACH YEAR AND THAT THE FUND'S OPERATING EXPENSES
REMAIN THE SAME. ALTHOUGH YOUR ACTUAL COSTS MAY BE HIGHER OR LOWER, BASED ON
THESE ASSUMPTIONS YOUR COSTS WOULD BE:
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1 YEAR 3 YEARS 5 YEARS 10 YEARS
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$111 $ 347 $ 601 $1,329
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INVESTMENT OBJECTIVE, PRINCIPAL INVESTMENT STRATEGIES
AND RELATED RISKS
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OBJECTIVE
The investment objective of Cohen & Steers Realty Shares, Inc. (the 'Fund') is
total return through investment in real estate securities. The Fund pursues its
investment objective of total return by seeking, with approximately equal
emphasis, capital appreciation and current income. There can be no assurance
that the Fund will achieve its investment objective. The Fund, of course, will
concentrate its investments in the real estate industry.
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PRINCIPAL INVESTMENT STRATEGIES
In making investment decisions on behalf of the Fund, the investment adviser
relies on a fundamental analysis of each company. The investment adviser reviews
each company's potential for success in light of the company's current financial
condition, its industry position, and economic, and market conditions. The
investment adviser evaluates a number of factors, including growth potential,
earnings estimates and the quality of management.
The following are the Fund's principal investment strategies. A more detailed
description of the Fund's investment policies and restrictions and more detailed
information about the Fund's investments are contained in the Fund's Statement
of Additional Information ('SAI').
Real Estate Companies
For purposes of the Fund's investment policies, a real estate company is one
that:
derives at least 50% of its revenues from the ownership, construction,
financing, management or sale of commercial, industrial, or residential real
estate; or
has at least 50% of its assets in such real estate.
Under normal circumstances, the Fund will invest substantially all of its assets
in the equity securities of real estate companies. These equity securities can
consist of:
common stocks (including REIT shares);
rights or warrants to purchase common stocks;
securities convertible into common stocks where the conversion feature
represents, in the investment adviser's view, a significant element of the
securities' value; and
preferred stocks.
Real Estate Investment Trusts
The Fund may invest without limit in shares of real estate investment trusts
('REITs'). REITs pool investors' funds for investment primarily in income
producing real estate or real estate related loans or interests. A REIT is not
taxed on income distributed to shareholders if, among other things, it
distributes to its shareholders at least 95% of its taxable income (other than
net capital gains) for each taxable year.
Types of REITs. REITs can generally be classified as Equity REITs, Mortgage
REITs and Hybrid REITs. Equity REITs invest the majority of their assets
directly in real property and derive their income primarily from rents. Equity
REITs can also realize capital gains by selling properties that have appreciated
in value. Mortgage REITs invest the majority of their assets in real estate
mortgages and derive their income primarily from interest payments. Hybrid REITs
combine the characteristics of both Equity REITs and Mortgage REITs. The Fund
invests primarily in Equity REITs.
Defensive Position
When the Fund's investment adviser believes that market or general economic
conditions justify a temporary defensive position, the Fund may deviate from its
investment objective and invest all or any portion of its assets in high-grade
debt securities without regard to whether the issuer is a real estate company.
When and to the extent the Fund assumes a temporary defensive position, it may
not pursue or achieve its investment objective.
4
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PRINCIPAL RISKS OF INVESTING IN THE FUND
Because prices of equity securities fluctuate from day to day, the value of the
Fund's portfolio and the Fund's price per share will vary based upon general
market conditions.
General Risks of Securities Linked to the Real Estate Market
The Fund will not invest in real estate directly, but only in securities issued
by real estate companies. However, because of its policy of concentration in the
securities of companies in the real estate industry, the Fund is also subject to
the risks associated with the direct ownership of real estate. These risks
include:
declines in the value of real estate;
risks related to general and local economic conditions;
possible lack of availability of mortgage funds;
overbuilding;
extended vacancies of properties;
increased competition;
increases in property taxes and operating expenses;
changes in zoning laws;
losses due to costs resulting from the clean-up of environmental problems;
liability to third parties for damages resulting from environmental problems;
casualty or condemnation losses;
limitations on rents;
changes in neighborhood values and the appeal of properties to tenants; and
changes in interest rates
Thus, the value of the Fund's shares may change at different rates compared to
the value of shares of a mutual fund with investments in a mix of different
industries.
In addition to these risks, Equity REITs may be affected by changes in the value
of the underlying property owned by the trusts, while Mortgage REITs may be
affected by the quality of any credit extended. Further, Equity and Mortgage
REITs are dependent upon management skills and generally may not be
diversified. Equity and Mortgage REITs are also subject to heavy cash flow
dependency, defaults by borrowers and self-liquidation. In addition, Equity and
Mortgage REITs could possibly fail to qualify for tax free pass-through of
income under the Internal Revenue Code, or to maintain their exemptions from
registration under the Investment Company Act of 1940, as amended. The above
factors may also adversely affect a borrower's or a lessee's ability to meet its
obligations to the REIT. In the event of a default by a borrower or lessee, the
REIT may experience delays in enforcing its rights as a mortgagee or lessor and
may incur substantial costs associated with protecting its investments.
In addition, even the larger REITs in the industry tend to be small to
medium-sized companies in relation to the equity markets as a whole.
Accordingly, REIT shares can be more volatile than -- and at times will perform
differently from -- large-capitalization stocks such as those found in the Dow
Jones Industrial Average. In addition, because smaller-capitalization stocks are
typically less liquid than large-capitalization stocks, REIT shares may
sometimes experience greater share-price fluctuations than the stocks of larger
companies.
Year 2000
Computer users around the world are faced with the dilemma of the Year 2000
issue, which stems from the use of two digits in most computer systems to
designate the year. When the year advances from 1999 to 2000, many computers
will not recognize '00' as the Year 2000. This issue could potentially affect
every aspect of computer-related activity, on an individual and corporate level.
The Fund could be adversely impacted if the computer systems used by the
investment adviser and other service providers have not been converted to meet
the requirements of the new century. The Fund's investment adviser has evaluated
its internal systems and expects them to be fully capable to handle the change
of millennium. The investment adviser is monitoring on an ongoing
5
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basis the progress of the Fund's service providers to convert their systems to
comply with the requirements of Year 2000. The investment adviser currently has
no reason to believe that these service providers will not be fully and timely
compliant. However, you should be aware that there can be no assurance that all
systems will be successfully converted prior to January 1, 2000, in which case
it would become necessary for the Fund to enter into agreements with new service
providers or to make other arrangements.
Portfolio Turnover
The Fund anticipates that its annual portfolio turnover rate will not exceed
150%, but the turnover rate will not be a limiting factor when the investment
adviser deems portfolio changes appropriate. The turnover rate may vary greatly
from year to year. An annual turnover rate of 150% occurs, for example, when all
of the securities held by the Fund are replaced one and one-half times in a
period of one year. A higher turnover rate results in correspondingly greater
brokerage commissions and other transactional expenses which are borne by the
Fund. High portfolio turnover may result in the realization of net short-term
capital gains by the Fund which, when distributed to shareholders, will be
taxable as ordinary income. See 'Tax Considerations.'
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MANAGEMENT OF THE FUND
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THE INVESTMENT ADVISER
Cohen & Steers Capital Management, Inc., with offices located at 757 Third
Avenue, New York, New York 10017, has been retained to provide investment
advice, and, in general, to conduct the management and investment program of the
Fund under the overall supervision and control of the Board of Directors of the
Fund. Cohen & Steers Capital Management, Inc., a registered investment adviser,
was formed in 1986 and is the leading U.S. manager of portfolios dedicated to
investments in REITs. Its current clients include pension plans, endowment funds
and mutual funds, including Cohen & Steers Realty Income Fund, Inc. and Cohen &
Steers Total Return Realty Fund, Inc., which are closed-end investment
companies, and Cohen & Steers Equity Income Fund, Inc., Cohen & Steers Realty
Shares, Inc., and Cohen & Steers Special Equity Fund, Inc., which are open-end
investment companies. All of Cohen & Steers' client accounts are invested
principally in real estate securities.
Under its Investment Advisory Agreement with the Fund, the investment adviser
furnishes a continuous investment program for the Fund's portfolio, makes the
day-to-day investment decisions for the Fund, and generally manages the
Fund's investments in accordance with the stated policies of the Fund, subject
to the general supervision of the Board of Directors of the Fund. The investment
adviser performs certain administrative services for the Fund and provides
persons satisfactory to the Board of Directors of the Fund to serve as officers
of the Fund. Such officers, as well as certain other employees and Directors of
the Fund, may be directors, officers, or employees of the investment adviser.
Under the Advisory Agreement, the investment adviser pays all employee costs and
other ordinary operating costs of the Fund. Excluded from ordinary operating
costs are interest charges, taxes, brokerage fees, extraordinary legal and
accounting fees and expenses and other extraordinary expenses.
The investment adviser also selects brokers and dealers to execute the Fund's
portfolio transactions. Consistent with the Conduct Rules of the National
Association of Securities Dealers, Inc., and subject to seeking best price and
execution, the investment adviser may consider sales of shares of the Fund as a
factor in the selection of brokers and dealers to execute portfolio transactions
on behalf of the Fund.
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For its services under the Advisory Agreement, and for paying the ordinary
operating expenses of the Fund, the Fund pays the investment adviser a monthly
management fee at the annual rate of 0.85% of the average daily net asset value
of the Fund up to $2.5 billion, plus 0.75% of such assets in excess of $2.5
billion. This fee is higher than that incurred by most other investment
companies. The Fund's effective management fee during 1998 was 0.84% of assets.
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PORTFOLIO MANAGERS
The Fund's portfolio managers, who have managed the Fund since its inception,
are
Martin Cohen -- Mr. Cohen is a Director, President and Treasurer of the Fund.
He is, and has been since their inception, President of Cohen & Steers Capital
Management, Inc., the Fund's investment adviser, and Vice President of Cohen &
Steers Securities, Inc., the Fund's distributor.
Robert H. Steers -- Mr. Steers is a Director, Chairman and Secretary of the
Fund. He is, and has been since their inception, Chairman of Cohen & Steers
Capital Management, Inc., the Fund's investment adviser, and President of Cohen
& Steers Securities, Inc., the Fund's distributor.
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PURCHASES AND REDEMPTIONS
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PRICING OF SHARES
The price at which you can purchase and redeem the Fund's shares is the net
asset value of the shares next determined after we receive your order in proper
form. We calculate our net asset value per share as of the close of trading on
the New York Stock Exchange on each day the Exchange is open for trading. We
determine net asset value per share by adding the market value of all
securities and other assets in the Fund's portfolio, subtracting the Fund's
liabilities, and dividing by the total number of shares of the Fund then
outstanding.
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PURCHASE MINIMUMS
You may open an account with the Fund with a minimum investment of $10,000. (We
are authorized to waive these minimums for particular investors.) Additional
investments must be at least $500 or, if as a result of redemption the value of
your account is less than $10,000, the minimum additional investment is the
greater of $500 or the amount necessary to increase the value of your account to
$10,000. We are free to reject any purchase order.
You may invest in the Fund through accounts with certain brokers, in which case
your broker may charge you a transaction fee when you purchase or redeem shares.
Brokers are free to increase or decrease the investment minimums, except that
the minimum for initial investments may not be reduced below $2,000.
7
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FORM OF PAYMENT
We will accept payment for shares in two forms:
1. A check drawn on any bank or domestic savings institution. Checks must be
payable in U.S. dollars and will be accepted subject to collection at full face
value.
2. A bank wire or Federal Reserve Wire of federal funds.
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PURCHASES OF SHARES
Initial Purchase By Wire
1. Telephone toll free from any continental state: (800) 437-9912. When you
contact the transfer agent, you will need the following information:
name of the Fund;
name(s) in which shares are to be registered;
address;
social security or tax identification number (where applicable);
dividend payment election;
amount to be wired;
name of the wiring bank; and
name and telephone number of the person to be contacted in connection with the
order.
The transfer agent will assign you an account number and a wire reference
control number.
2. Instruct the wiring bank to transmit at least the required minimum amount
(see 'Purchase Minimums' above) to the custodian:
The Chase Manhattan Bank
One Chase Manhattan Plaza
New York, NY 10081-1000
ABA # 021000021
Account: DDA # 910-2-733012
Attn: Cohen & Steers Realty Shares
For further credit to: (Account name)
Account Number:
Wire Reference Control #:
3. Complete the Subscription Agreement attached to the end of this Prospectus.
Mail the Subscription Agreement to the transfer agent:
Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Initial Purchase By Mail
1. Complete the Subscription Agreement included at the end of this Prospectus.
2. Mail the Subscription Agreement and a check in at least the required minimum
amount (see 'Purchase Minimums' above), payable to the Fund, to the transfer
agent at the above address.
Additional Purchases By Wire
1. Telephone toll free from any continental state: (800) 437-9912. When you
contact the transfer agent, you will need the following information:
name of the Fund;
account number;
amount to be wired;
name of the wiring bank; and
name and telephone number of the person to be contacted in connection with the
order.
The transfer agent will assign you a wire reference control number.
2. Instruct the wiring bank to transmit at least the required minimum amount
(see 'Purchase Minimums' above) to the custodian:
The Chase Manhattan Bank
One Chase Manhattan Plaza
New York, NY 10081-1000
ABA # 021000021
Account: DDA # 910-2-733012
Attn: Cohen & Steers Realty Shares
For further credit to: (Account Name)
Account Number:
Wire Reference Control #:
Additional Purchases By Mail
1. Make a check payable to the Fund in at least the required minimum amount (see
'Purchase Minimums' above). Write your Fund account number on the check.
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2. Mail the check and the detachable stub from the Statement of Account (or a
letter providing your account number) to the transfer agent at the address set
forth above.
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EXCHANGE PRIVILEGE
You may exchange some or all of your Fund shares for shares of the other mutual
funds managed by Cohen & Steers, or for shares of Cohen & Steers Vista Cash
Management Fund, subject to any applicable initial sales charges. If you acquire
shares of other Cohen & Steers funds by purchase (rather than by exchange of
Fund shares), you may exchange those shares for Fund shares, subject to any
applicable contingent deferred sales charges.
An exchange of shares may result in your realizing a taxable gain or loss for
income tax purposes. See 'Tax Considerations.' The exchange privilege is
available to shareholders residing in any state in which the shares being
acquired may be legally sold. Before you exercise the exchange privilege, you
should read the prospectus of the fund whose shares you are acquiring. Your
broker may limit or prohibit your right to use the exchange privilege.
There is no charge for the exchange privilege (although your broker may impose a
transaction fee). We may limit or terminate your exchange privilege if you make
exchanges more than four times a year. WE MAY MODIFY OR REVOKE THE EXCHANGE
PRIVILEGE FOR ALL SHAREHOLDERS UPON 60 DAYS PRIOR WRITTEN NOTICE. For additional
information concerning exchanges, or to make an exchange, please call the
transfer agent at (800) 437-9912.
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REDEMPTIONS OF SHARES
You may redeem your shares by telephone or through the transfer agent.
Redemption By Telephone
To redeem shares by telephone, call the Fund's transfer agent at (800) 437-9912.
In order to be honored at that day's price, we must receive any telephone
redemption requests by 4:00 p.m., Eastern time. If we receive your telephone
redemption request after 4:00 p.m., Eastern time, your redemption will be
honored at the next day's price.
If you would like to change your telephone redemption instructions, you must
send the transfer agent written notification signed by all of the account's
registered owners, accompanied by signature guarantee(s), as described below.
We may modify or suspend telephone redemption privileges without notice during
periods of drastic economic or market changes. WE MAY MODIFY OR TERMINATE THE
TELEPHONE REDEMPTION PRIVILEGE AT ANY TIME ON 30 DAYS NOTICE TO SHAREHOLDERS.
Redemption By Mail
You can redeem Fund shares by sending a written request for redemption to the
transfer agent:
Chase Global Funds Services Company
P.O. Box 2798
Boston, Massachusetts 02208-2798
Attn: Cohen & Steers Realty Shares
A written redemption request must:
state the number of shares or dollar amount to be redeemed;
identify the your account number and tax identification number; and
be signed by each registered owner exactly as the shares are registered.
If the shares to be redeemed were issued in certificate form, the certificate
must be endorsed for transfer (or be accompanied by a duly executed stock power)
and must be submitted to the transfer agent together with a redemption request.
Other Redemption Information
Payment of Redemption Proceeds. The Fund will send you the proceeds by check. If
you made the
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election to receive redemption proceeds by wire on the Subscription Agreement,
the Fund will send you the proceeds by wire to your designated bank account.
When proceeds of a redemption are to be paid to someone other than the
shareholder, either by wire or check, you must send a letter of instruction and
the signature(s) on the letter of instruction must be guaranteed, as described
below, regardless of the amount of the redemption. The transfer agent will
normally mail checks for redemption proceeds within five business days.
Redemptions by wire will normally be sent within two business days. The Fund
will delay the payment of redemption proceeds, however, if your check used to
pay for the shares to be redeemed has not cleared, which may take up to 15 days
or more.
The Fund will pay redemption proceeds in cash, by check or wire, unless the
Board of Directors believes that economic conditions exist which make redeeming
in cash detrimental to the best interests of the Fund. In the unlikely event
that this were to occur, all or a portion of your redemption proceeds would
consist of readily marketable portfolio securities of the Fund transferred into
your name. You would then incur brokerage costs in converting the securities
to cash.
Signature Guarantees. The guarantor of a signature must be a trust company or
national bank, a member bank of the Federal Reserve System, a member firm of a
national securities exchange or any other guarantor approved by the Fund's
transfer agent. For redemptions made by corporations, executors, administrators
or guardians, the transfer agent may require additional supporting documents
evidencing the authority of the person making the redemption (including evidence
of appointment or incumbency). For additional information regarding the specific
documentation required, contact the transfer agent at (800) 437-9912. The
transfer agent will not consider your redemption request to be properly made
until it receives all required documents in proper form.
Redemption of Small Accounts. If your Fund account has a value of $2,000 or less
as the result of voluntary redemption, we may redeem your remaining shares. We
will, however, give you 30 days notice of our intention to do so. During this
30-day notice period, you can make additional investments to avoid the forced
liquidation of your account.
- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
SHAREHOLDER SERVICES PLAN
The Fund has adopted a shareholder services plan which provides that the Fund
may obtain the services of qualified financial institutions to act as
shareholder servicing agents for their customers. Under this plan, the Fund may
enter into agreements pursuant to which the shareholder servicing agents perform
certain shareholder services not otherwise provided by the Fund's transfer
agent. For these services, the Fund may pay the shareholder servicing agent a
fee of up to 0.05% of the average daily net assets of the Fund owned by
investors for which the shareholder servicing agent maintains a servicing
relationship.
Among the services provided by shareholder servicing agents are: answering
customer inquiries regarding account matters; assisting in designating and
changing various account options; aggregating and processing purchase and
redemption orders and transmitting and receiving funds for shareholder orders;
transmitting, on behalf of the Fund, proxy statements, prospectuses and
shareholder reports to shareholders and tabulating proxies; processing
dividend payments and providing subaccounting services for Fund shares held
beneficially; and providing such other services as the Fund or a shareholder
may request.
10
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS
The Fund will declare and pay dividends from its investment income quarterly.
The Fund intends to distribute net realized capital gains, if any, at least
once each year, normally in December. The transfer agent will automatically
reinvest your dividends and distributions in additional shares of the Fund
unless you elected on your Subscription Agreement to have them paid to you in
cash.
- --------------------------------------------------------------------------------
TAX CONSIDERATIONS
The following brief tax discussion assumes you are a U.S. shareholder. In the
SAI we have provided more detailed information regarding the tax consequences of
investing in the Fund.
Dividends paid to you out of the Fund's 'investment company taxable income'
(which includes dividends the Fund receives on REIT shares, interest income, and
net short-term capital gains) will be taxable to you as ordinary income.
Distributions of net capital gains (the excess of net long-term capital gains
over net short-term capital losses), if any, are taxable to you as long-term
capital gains, regardless of how long you have held your Fund shares. A
distribution of an amount in excess of the Fund's earnings is treated as a
non-taxable return of capital that reduces your tax basis in your Fund shares;
any such distributions in excess of your tax basis are treated as gain from a
sale of your shares. The tax treatment of your dividends and distributions will
be the same regardless of whether they were paid to you in cash or reinvested in
additional Fund shares.
A distribution will be treated as paid to you on December 31 of the current
calendar year if it is declared by the Fund in October, November or December
with a record date in such a month and paid during January of the following
year.
Each year, we will notify you of the tax status of dividends and other
distributions.
If you redeem your Fund shares, or exchange them for shares of another Cohen &
Steers fund, you may realize a capital gain or loss which will be long-term or
short-term, depending on your holding period for the shares.
We may be required to withhold U.S. federal income tax at the rate of 31% of all
taxable distributions payable if you:
fail to provide us with your correct tax payer identification number;
fail to make required certifications; or
have been notified by the IRS that you are subject to backup withholding.
Backup withholding is not an additional tax. Any amounts withheld may be
credited against your U.S. federal income tax liability.
Fund distributions also may be subject to state and local taxes.
You should consult with your own tax adviser regarding the particular
consequences of investing in the Fund.
11
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the Fund's
financial performance for the past five years. Certain information reflects
financial results for a single Fund share. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the Fund (assuming reinvestment of all dividends and distributions). This
information has been audited by PricewaterhouseCoopers LLP, whose report, along
with the Fund's audited financial statements, are included in the current annual
report, which is available free of charge upon request.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE 1998 1997 1996 1995 1994
- ------------------------------------ ---------- ---------- ---------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year.............................. $ 50.18 $ 45.09 $ 34.62 $ 32.90 $ 31.92
Income from investment operations
Net investment income........... 1.97 1.87 1.86 1.86 1.66
Net realized and unrealized
gain/(loss) on investments.... (10.89) 7.40 11.04 1.69 0.98
---------- ---------- ---------- -------- --------
Total from investment
operations................ (8.92) 9.27 12.90 3.55 2.64
---------- ---------- ---------- -------- --------
Less dividends and distributions to
shareholders from:
Net investment income........... (1.59) (1.88) (1.76) (1.33) (1.09)
Net Realized gain on
investments................... (1.56) (2.30) (0.55) -- --
Tax return of capital........... (0.13) -- (0.12) (0.50) (0.57)
---------- ---------- ---------- -------- --------
Total dividends and
distributions to
shareholders.............. (3.28) (4.18) (2.43) (1.83) (1.66)
---------- ---------- ---------- -------- --------
Net asset value, end of year........ $ 37.98 $ 50.18 $ 45.09 $ 34.62 $ 32.90
=========== =========== ========== ======== ========
==========================================================================================================
Total investment return............. -18.07% 21.16% 38.48% 11.13% 8.31%
=========== =========== ========== ======== ========
==========================================================================================================
Ratios/Supplemental Data:
Net assets, end of year
(in millions)................. $1,933,340 $3,432,995 $2,036,379 $793,084 $458,098
=========== =========== ========== ======== ========
Ratio of expenses to average
daily net assets (before
expense reduction)............ 1.04% 1.06% 1.10% 1.16% 1.26%
=========== =========== ========== ======== ========
Ratio of expenses to average
daily net assets (net of
expense reduction)............ 1.03% 1.05% 1.08% 1.12% 1.14%
=========== =========== ========== ======== ========
Ratio of net investment income
to average daily net assets
(before expense reduction).... 4.23% 4.02% 5.27% 6.01% 5.59%
=========== =========== ========== ======== ========
Ratio of net investment income
to average daily net assets
(net of expense reduction).... 4.24% 4.04% 5.28% 6.05% 5.71%
=========== =========== ========== ======== ========
Portfolio turnover rate......... 30.18% 40.44% 33.23% 22.68% 39.00%
=========== =========== ========== ======== ========
</TABLE>
12
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS REALTY SHARES, INC.
- --------------------------------------------------------------------------------
SUBSCRIPTION AGREEMENT
1 ACCOUNT TYPE (Please print; indicate only one registration type)
[ ] INDIVIDUAL OR JOINT ACCOUNT
<TABLE>
<S> <C>
--------------------------------------------------------------- -- - -- - - -- - - - - -
Name Social Security Number
---------------------------------------------------------------
Name of Joint Registrant, if any.
(For joint registrations, the account registrants will be joint tenants
with the right of survivorship and not tenants in common unless tenants
in common or community property registrations are requested.)
[ ] TRUST [ ] CORPORATION [ ] PARTNERSHIP [ ] OTHER ENTITY
--------------------------------------------------------------- -------------------------
Name of Entity Tax Identification Number
--------------------------------------------------------------- ---------------------------------------
Name of Trust Agreement (if applicable) Date of Trust Agreement (if applicable)
[ ] UNIFORM GIFT TO MINORS, OR [ ] UNIFORM TRANSFER TO MINORS
(where allowed by Law)
--------------------------------------------------------------- Under the _______________ (state of residence
Name of Adult Custodian (only one permitted) of minor) Uniform Gifts/Transfer to Minor's Act
--------------------------------------------------------------- -- - -- - - -- - - - - -
Name of Minor (only one permitted) Minor's Social Security Number
- ----------------------------------------------------------------------------------------------------------------
2 MAILING ADDRESS
( )
--------------------------------------------------------------- ---------------------------------------
Street or P.O. Box Home Telephone Number
( )
--------------------------------------------------------------- ---------------------------------------
City and State Zip Code Business Telephone Number
</TABLE>
- --------------------------------------------------------------------------------
3 INVESTMENT INFORMATION
$__________ Amount to invest ($10,000 minimum investment). Do not
send cash. Investment will be paid for by
(please check one):
[ ] Check or draft made payable to 'Cohen & Steers Realty
Shares, Inc.'
[ ] Wire through the Federal
Reserve System.* ______________________________________________
Wire Reference Control Number
* Call (800) 437-9912 to notify the Fund of investments by wire and
to obtain a Wire Reference Control Number. See the PURCHASE OF
SHARES section of the Prospectus for wire instructions.
- --------------------------------------------------------------------------------
4 EXCHANGE PRIVILEGES
Exchange privileges will be automatically granted unless you check
the box below. Shareholders wishing to exchange into other Cohen &
Steers Funds should consult the EXCHANGE PRIVILEGE section of the
Prospectus. (Note: If shares are being purchased through a dealer,
please contact your dealer for availability of this service.)
[ ] I decline the exchange privilege.
PLEASE CONTINUE APPLICATION ON REVERSE SIDE.
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
5 REDEMPTION PRIVILEGES
Shareholders may select the following redemption privileges by
checking the box(es) below. See REDEMPTION OF SHARES section of the
Prospectus for further details. Redemption privileges will be
automatically declined for boxes not checked.
[ ] I authorize the Transfer Agent to redeem shares in my account(s)
by telephone, in accordance with the procedures and conditions
set forth in the Fund's current Prospectus.
[ ] I wish to have redemption proceeds paid by wire (please complete
Section 7).
- --------------------------------------------------------------------------------
6 DISTRIBUTION OPTIONS
Dividends and capital gains may be reinvested or paid in cash. If no
options are selected below, both dividends and capital gains will be
reinvested in additional Fund shares.
Dividends [ ] Reinvest. [ ] Pay in cash.
Capital Gains [ ] Reinvest. [ ] Pay in cash.
[ ] I wish to have my distributions paid by wire (please complete
Section 7).
- --------------------------------------------------------------------------------
7 BANK OF RECORD (FOR WIRE INSTRUCTIONS)
PLEASE ATTACH A VOIDED CHECK FROM YOUR BANK ACCOUNT.
<TABLE>
<S> <C>
--------------------------------------------------------------- ---------------------------------------
Bank Name Bank ABA Number
--------------------------------------------------------------- ---------------------------------------
Street or P.O. Box Bank Account Number
--------------------------------------------------------------- ---------------------------------------
City and State Zip Code Account Name
</TABLE>
- --------------------------------------------------------------------------------
8 SIGNATURE AND TAXPAYER CERTIFICATION
By signing this form, the Investor represents and warrants that: (a) the
Investor has the full right, power and authority to invest in the Fund;
and (b) the Investor has received a current prospectus of the Fund and
agrees to be bound by its terms. Persons signing as representatives or
fiduciaries of corporations, partnerships, trusts or other organizations
are required to furnish corporate resolutions or similar documents
providing evidence that they are authorized to effect securities
transactions on behalf of the Investor (alternatively, the secretary or
may drop because of the failure of borrowers to pay their loans and poor
of the persons signing on the space provided below). In addition,
signatures of representatives or fiduciaries of corporations and other
entities must be accompanied by a signature guarantee by a commercial
bank that is a member of the Federal Deposit Insurance Corporation, a
trust company or a member of a national securities exchange.
- --------------------------------------------------------------------------------
PLEASE CHECK ONE:
[ ] U.S. CITIZEN/TAXPAYER
UNDER THE PENALTIES OF PERJURY, THE UNDERSIGNED CERTIFIES THAT:
(1) THE TAXPAYER IDENTIFICATION NUMBER PROVIDED IS CORRECT, AND
(2) I/WE ARE NOT SUBJECT TO BACKUP WITHHOLDING BECAUSE: (A) I/WE
ARE EXEMPT FROM BACKUP WITHHOLDING, OR (B) I/WE HAVE NOT BEEN
NOTIFIED BY THE INTERNAL REVENUE SERVICE ('IRS') THAT I/WE ARE
SUBJECT TO BACKUP WITHHOLDING AS A RESULT OF A FAILURE TO REPORT ALL
INTEREST OR DIVIDENDS, OR (C) THE IRS HAS NOTIFIED ME THAT I AM NO
LONGER SUBJECT TO BACKUP WITHHOLDING. NOTE: IF YOU HAVE BEEN NOTIFIED
BY THE IRS THAT YOU ARE CURRENTLY SUBJECT TO BACKUP WITHHOLDING
BECAUSE OF UNDER-REPORTING INTEREST OF DIVIDENDS ON YOUR TAX RETURN,
YOU MUST CROSS OUT ITEM 2 ABOVE.
[ ] NON U.S. CITIZEN/TAXPAYER (FORM W-8 ATTACHED)
INDICATE COUNTRY OF RESIDENCE FOR TAX PURPOSES ______________________
UNDER PENALTY OF PERJURY, I/WE CERTIFY THAT I/WE ARE NOT U.S.
CITIZENS AND I/WE ARE EXEMPT FOREIGN PERSONS AS DEFINED BY THE IRS.
THE IRS DOES NOT REQUIRE YOUR CONSENT TO ANY PROVISION OF THIS
DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP
WITHHOLDING.
- --------------------------------------------------------------------------------
I certify that (1) the information provided on this Subscription
Agreement is true, correct and complete, (2) I have read the prospectus
for the Fund and agree to the terms thereof, and (3) I am of legal age
or an emancipated minor.
x
------------------------------------------ -------
Signature (Owner, Trustee, Etc.) Date
x
------------------------------------------ -------
Signature (Joint Owner, Co-Trustee) Date
Mail to: Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208
<PAGE>
<PAGE>
[Logo]
TO OBTAIN ADDITIONAL INFORMATION ABOUT THE FUND
If you would like additional information about Cohen & Steers Realty Shares,
Inc., the following documents are available to you without any charge, upon
request:
Annual/Semi-Annual Reports -- Additional information about the Fund's
investments is available in the Fund's annual and semi-annual report to
shareholders. In these reports, you will find a discussion of the market
conditions and investment strategies that significantly affected the Fund's
performance during its most recent fiscal year.
Statement of Additional Information -- Additional information about the Fund's
structure and operations can be found in the Statement of Additional
Information ('SAI'). The information presented in the Statement of Additional
Information is incorporated by reference into the prospectus and is legally
considered to be part of this prospectus.
To request a free copy of any of the materials described above, or to make any
other inquiries, please contact us:
<TABLE>
<S> <C>
By telephone (800) 437-9912
By mail Cohen & Steers Realty Shares
c/o Chase Global Fund Services Company
P.O. Box 2798
Boston, Massachusetts 02208-2798
By e-mail [email protected]
On the Internet http://www.cohenandsteers.com
</TABLE>
Our prospectus and SAI may also be available from your broker or financial
adviser. Reports and other information about the Fund (including the Fund's
Statement of Additional Information) may also be obtained from the Securities
and Exchange Commission:
By going to the Commission's Public Reference Room in Washington, D.C. where
you can review and copy the information. Information on the operation of the
Public Reference Room may be obtained by calling the Commission at
1-800-SEC-0330.
By accessing the Commission's Internet site at http://www.sec.gov where you can
view, download and print the information.
By writing to the Public Reference Section of the Securities and Exchange
Commission, Washington, D.C. 20549-6009 where, upon payment of a duplicating
fee, copies of the information will be sent to you.
SEC File No. 811-6302
757 THIRD AVENUE, NEW YORK, NEW YORK 10017
<PAGE>
