<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
PIC Investment Trust
(Name of Registrant as Specified In Its Charter)
PIC Investment Trust
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
- --------------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
- -------------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
<PAGE> 2
/ / Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
- -------------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
3) Filing Party:
- --------------------------------------------------------------------------------
4) Date Filed:
<PAGE> 3
PIC Institutional Balanced Fund
100 North Lake Avenue
Pasadena, California 91101-4106
Notice of Special Meeting
To the Shareholders of the PIC Institutional Balanced Fund, a portfolio
of the PIC Investment Trust:
Notice is hereby given that a Special Meeting (the "Meeting") of
shareholders of the PIC Institutional Balanced Fund (the "Fund"), a separate
series of the PIC Investment Trust (the "Trust"), will be held on February 19,
1997, at 10:00 a.m., Pacific Standard Time, at the offices of Provident
Investment Counsel, 300 North Lake Avenue, Pasadena, California 91101. At the
Meeting, you and the other shareholders of the Fund will be asked to consider:
1. The adoption of a Plan of Distribution pursuant to Rule 12b-1
under the Investment Company Act of 1940, as amended; and
2. Any other business that may properly come before the Meeting
or any adjournments thereof.
Shareholders of record at the close of business on January 15, 1977
are entitled to notice of, and to vote at, the Meeting. Your attention is called
to the accompanying Proxy Statement. Regardless of whether you plan to attend
the Meeting, PLEASE COMPLETE, SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY so
that a quorum will be present and a maximum number of shares may be voted. If
you are present at the Meeting, you may change your vote, if desired, at that
time.
By Order of the Board of Trustees
Jeffrey J. Miller
President
Pasadena, California
January 25, 1997
<PAGE> 4
PIC Institutional Balanced Fund
300 North Lake Avenue
Pasadena, California 91101-4106
PROXY STATEMENT
This Proxy Statement is furnished to the shareholders of the PIC
Institutional Balanced Fund (the "Fund"), a portfolio of PIC Investment Trust
(the "Trust"), on behalf of the Trust's Board of Trustees in connection with the
solicitation of voting instructions for use at a Special Meeting of Shareholders
of the Fund (the "Meeting") to be held on February 19, 1997, at 10:00 a.m.,
Pacific Standard Time, at the offices of Provident Investment Counsel, 300 North
Lake Avenue, Pasadena, California 91101 for the purposes set forth below and in
the accompanying Notice of Special Meeting. The approximate mailing date of this
Proxy Statement is January 15, 1997. At the Meeting the shareholders of the Fund
will be asked to consider:
1. The adoption of a Plan of Distribution (the "Plan") pursuant
to Rule 12b-1 under the Investment Company Act of 1940 as
amended (the "1940 Act"); and
2. Any other business that may properly come before the Meeting
or any adjournments thereof.
The Trust seeks to achieve the Fund's investment objective by investing
all of the assets of the Fund in the PIC Balanced Portfolio (the "Portfolio"),
an open-end management investment company. The Portfolio's investment adviser is
Provident Investment Counsel ("PIC"), 300 North Lake Avenue, Pasadena,
California 91101. PIC also serves as one of the administrators of the Fund. The
Fund's other administrator is Investment Company Administration Corporation,
2025 East Financial Way, Suite 101, Glendora, California 91741. The Fund's
principal underwriter is First Fund Distributors, Inc., 4455 East Camelback,
Suite 261E, Phoenix, Arizona 85018.
The Trust will request broker-dealer firms, custodians, nominees and
fiduciaries to forward proxy materials to the beneficial owners of the shares of
the Fund held of record by such persons. In addition to the solicitation of
proxies by mail, officers and employees of the Trust, without additional
compensation, may solicit proxies in person or by telephone. The costs
associated with such solicitation and the Meeting will be borne by PIC.
Shareholders of the Fund at the close of business on January 15, 1997
will be entitled to be present and vote at the Meeting. As of that date, there
were 1,746,443 shares of the Fund outstanding and entitled to vote. The
affirmative vote of the holders of a majority of the outstanding shares of the
Fund is required to approve the Plan. "Majority" for this purpose under the 1940
Act means the lesser of (i) 67% of the shares represented at the meeting if more
than 50% of such outstanding shares are represented, or (ii) more than 50% of
such outstanding shares.
<PAGE> 5
Abstentions and broker non-votes will be counted as shares present for
purposes of determining whether a quorum is present but will not be counted for
or against any adjournment or the proposal to adopt the Plan. Accordingly,
abstentions and broker non-votes effectively will be a vote against adjournment
and against the Plan. Broker non-votes are shares held in street name for which
the broker indicates that instructions have not been received from the
beneficial owners or other persons entitled to vote and for which the broker
does not have discretionary voting authority.
To the knowledge of the Trust's management, as of January 15, 1997 the
officers and trustees of the Fund owned, as a group, less than 1% of the shares
of the Fund. To the knowledge of the Trust's management, as of January 15,
1997, the only persons owning beneficially more than 5% of the outstanding
shares of the Fund were as follows:
Gilbert Papazian IRA
1445 S. Down Road
Hillsborough, CA 94163 -- 7.91%
Oregon School of Arts & Crafts Foundation
8245 S.W. Barnes Road
Portland, OR 97225 -- 5.90%
Sanwa Bank Ttee Trust
FBO Beth Whipple
P.O. Box 60078
Los Angeles, CA 90060 -- 5.18%
Rita Moya Trustee for
National Health Foundation, Inc.
201 N. Figueroa
Los Angeles, CA 90012 -- 13.52%
Fleet National Bank Trustee
for Davies Medical Pension Plan
P.O. Box 92800
Rochester, NY 14692 -- 42.61%
The persons named in the accompanying proxy will vote in each case as
directed in the proxy, but in the absence of such direction, they intend to vote
FOR the proposal to adopt the Plan and may vote in their discretion with respect
to other matters not now known to the Board of Trustees that may be presented to
the Meeting.
APPROVAL OR DISAPPROVAL OF A RULE 12B-1 PLAN OF DISTRIBUTION
On December 19, 1996, the Trustees of the Trust, including a majority
of those Trustees who are not "interested persons" of the Trust (as defined in
the 1940 Act) and who have no direct or indirect financial interest in the
operation of the Plan or any agreement related to the Plan (the "Plan
Trustees"), adopted the Plan. The Fund was originally organized as an investment
vehicle for institutional investors, and its name (PIC Institutional Balanced
Fund) reflects that target market. However, over time it has become apparent to
the Trust's management and to the Trustees that a significant potential market
for the sale of Fund shares is the self-directed retirement plan market (e.g.,
401(k) plans) and other "retail" investors. In approving the Plan, the Trustees
determined that the fees payable under the Plan are likely to facilitate the
sale of shares in this market, resulting in higher levels of sales and lower
levels of redemptions than otherwise would be obtainable. This in turn should
assist in the goal of achieving net positive cash flow into the Fund and an
increase in Fund asset size. There can be no assurance, however, that the Fund
will achieve net positive cash flow. If the Plan is approved, the Fund's name
will be changed to the PIC Pinnacle Balanced Fund, to better reflect its target
market.
Under the Plan, the Fund would be authorized to pay up to 0.25% on an
annualized basis of the Fund's average daily net assets as distribution and
service fees to PIC in connection with the provision of certain distribution and
shareholder services to the Fund by banks, broker-dealers, pension consultants,
record-keepers and others. Distribution services are services primarily intended
to result in sales of Fund shares, including, but not limited to: compensation
and expenses of registered representatives or other sales and marketing
personnel of banks and
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<PAGE> 6
broker-dealers; printing expenses incurred in printing prospectuses and reports
for prospective investors; and the cost of preparing, printing and distributing
advertising relating to the Fund. Shareholder service related activities include
the furnishing of personal and shareholder account maintenance services to
shareholders; processing purchase and redemption orders; and responding to
routine telephone inquiries.
The Plan is a "reimbursement" plan and not a "compensation" plan. This
means that payments will be made to PIC only to the extent that expenses are
actually incurred for distribution or service related activities. At any given
time, the aggregate amount of expenses incurred by PIC in connection with
payments for distribution and service related activities may exceed the total
payments made by the Fund pursuant to the Plan. Under the Plan, the Fund will
maintain records of, and carry forward amounts attributable to, payments or
expenses incurred by PIC for distribution and service related activities in
excess of 0.25% of the Fund's average daily net assets. Any such amounts within
this percentage limitation would be paid in future periods so long as the Plan
is in effect.
PIC has voluntarily undertaken to limit the Fund's annual expenses,
including those expenses allocated from the Portfolio, to 1.05%. In view of this
expense cap, approval of the Plan will not increase expenses incurred by the
Fund. However, the expense cap is voluntary, and although PIC has no current
intention to terminate it, the cap could be terminated at any time in the sole
discretion of PIC. Accordingly, adoption of the Plan has the potential to impact
the Fund's expenses. Set forth in Exhibit A is a comparative table showing the
amount of fees and expenses actually paid by the Fund and the amount of fees and
expenses that would have been paid had the Plan been in effect, based on the
Fund's fiscal year ended October 31, 1996.
The Plan provides that the Board of Trustees will be provided on a
quarterly basis with a written report specifying in reasonable detail the
amounts expended for distribution and service related activities and the
purposes for which such expenditures were made. The Plan, if approved, will
remain in effect for one year from the date of such approval, and thereafter
from year to year so long as it is approved by a majority of the Trust's entire
Board of Trustees, including a majority of the Plan Trustees, unless sooner
terminated according to its terms. In accordance with the requirements of Rule
12b-1 under the 1940 Act, the selection and nomination of those Trustees who are
not interested persons of the Trust will be committed to the discretion of the
disinterested Trustees. The Fund currently is not subject to a 12b-1 Plan. The
form of the Plan is attached as Exhibit B.
Trustees' Evaluation
In considering adoption of the Plan, the Board of Trustees considered,
among other things: (i) the potential costs and benefits of the Plan to
shareholders, including the fact that the adoption of the Plan could increase
the level of expenses paid by Fund shareholders if PIC terminates its expense
cap; (ii) whether the Plan could be expected to assist in the marketing of Fund
shares and reduce the level of share redemptions; (iii) the advantages to the
Fund and its
3
<PAGE> 7
shareholders that might result from growth in the Fund's assets, including
economies of scale and reduced expense ratios; (iv) the advantages to the
Portfolio, and thus indirectly to the Fund and its shareholders, that might
result from growth in the Fund's assets, including greater diversification, and
the fact that net positive cash flows into the Fund could facilitate portfolio
management at the level of the Portfolio by eliminating the need to liquidate
favorable portfolio positions in order to generate sufficient cash to satisfy
redemption requests; and (v) the competitive situation in the industry involving
the adoption of 12b-1 plans by an increasing number of funds, making the Plan a
reasonable measure to encourage additional sales and discourage redemptions. The
Trustees determined that the ability to compensate broker-dealers, banks and
others for distribution and service related activities is likely to result in
higher levels of sales and lower levels of redemptions of Fund shares than would
otherwise occur. This in turn should assist the Fund in achieving net positive
cash flows and an increase in its asset size.
The Trustees also recognized and considered that possible benefits may
be realized by PIC as a result of the adoption of the Plan. If Fund assets grow
more rapidly as a result of the implementation of the Plan, the investment
advisory and administrative fees payable to PIC by the Portfolio and the Fund
(which fees are calculated as a percentage of net assets) will also increase.
Following their consideration, the Trustees, including the Plan
Trustees, concluded that the Plan is in the best interest of the Fund and is
reasonably likely to benefit the shareholders. The Plan will not become
effective unless approved by shareholders.
Recommendation
At the Meeting, Shareholders of the Fund will vote on the proposed
Plan.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS OF THE FUND VOTE FOR THE
PROPOSAL.
GENERAL INFORMATION
Other Matters to Come Before the Meeting
The Fund's management does not know of any matters to be presented at
the Meeting other than those described in this Proxy Statement. If other
business should properly come before the Meeting, the proxyholders will vote
thereon in accordance with their best judgment.
Shareholder Proposals
The Meeting is a special meeting of shareholders. The Fund is not
required to, nor does it intend to, hold regular annual meetings of its
shareholders. If such a meeting is called, any
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<PAGE> 8
shareholder who wishes to submit a proposal for consideration at the meeting
should submit the proposal promptly to the Trust.
Reports to Shareholders
The Trust will furnish, without charge, a copy of its most recent
Annual Report to Shareholders of the Trust on request. Requests for such reports
should be directed to the Trust c/o Provident Investment Counsel, 300 North Lake
Avenue, Pasadena, California 91101-4022, or to (800) 576-8229.
IN ORDER THAT THE PRESENCE OF A QUORUM AT THE MEETING MAY BE ASSURED,
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
Jeffrey J. Miller
President
Pasadena, California
January 27, 1997
5
<PAGE> 9
EXHIBIT LIST
Exhibit A Comparative Expense Information
Exhibit B Form of 12b-1 Plan
6
<PAGE> 10
EXHIBIT B
PLAN OF DISTRIBUTION PURSUANT TO RULE 12b-1
UNDER INVESTMENT COMPANY ACT OF 1940
INTRODUCTION
The Plan of Distribution (the "Plan") set forth below, which is
designed to conform to the requirements of Rule 12b-1 under the Investment
Company Act of 1940 (the "1940 Act") has been adopted by the Board of Trustees
of the PIC Investment Trust (the "Trust") on behalf of its PIC Institutional
Balanced Fund series (the "Fund") and will become effective upon the approval of
the Plan by the shareholders of the Fund.
A majority of the Board of Trustees of the Trust including a majority
of those Trustees who are not "interested persons" of the Fund (as defined in
the 1940 Act) and who have no direct or indirect financial interest in the
operation of this Plan or any agreements related to it (the "Rule 12b-1
Trustees"), have determined by votes cast in person at a meeting called for the
purpose of voting on this Plan that there is a reasonable likelihood that
adoption of this Plan will benefit the Fund and its shareholders.
The purpose of the Plan is to create incentives to various entities,
including but not limited to banks, broker-dealers, pension consultants and
record-keepers, to provide distribution assistance to their customers who are
prospective investors in the Fund and ongoing assistance to their customers who
are investors in the Fund, and to defray the costs and expenses associated with
the preparation, printing and distribution of sales literature, prospectuses for
prospective investors and other promotional, distribution and shareholder
servicing activities.
THE PLAN
The material aspects of the Plan are as follows:
1. Distribution Activities
The Fund shall engage Provident Investment Counsel ("PIC"), one of the
Fund's administrators, to arrange for distribution of shares of the Fund and for
the servicing of shareholder accounts through such qualified broker-dealers and
other institutions, including banks, pension consultants and record-keepers, as
PIC may select. Services provided and activities undertaken to distribute shares
of the Fund are referred to in the Plan as "Distribution Activities."
B-1
<PAGE> 11
2. Reimbursement for Distribution Activities
The Trust shall reimburse PIC at a rate which shall not exceed 0.25%
per annum of the Fund's average daily net assets for all costs incurred by it in
performing Distribution Activities. The Fund shall calculate and accrue daily
amounts reimbursable by the Fund hereunder and shall pay such amounts monthly on
the first day of each month. Costs of PIC subject to reimbursement hereunder are
all costs of performing Distribution Activities and include, among others:
(a) costs of payments made to banks, broker-dealers, pension
consultants, record-keepers and other entities that provide
distribution and shareholder services to prospective investors
or to Fund shareholders, including but not limited to costs
of payments made as incentive compensation or to reimburse
expenses incurred, such as office space and equipment and
telephone facilities;
(b) costs, including costs of payments, relating to answering
routine inquiries regarding the Fund, processing shareholder
transactions and providing any other shareholder services not
otherwise provided by the Trust's transfer agency or other
servicing arrangements;
(c) costs of payments made pursuant to any Distribution Agreement
adopted under this Plan;
(d) costs, including costs of payments, relating to the
formulation and implementation of marketing and promotional
activities, including, but not limited to, direct mail
promotions and television, radio, newspaper, magazine and
other mass media advertising;
(e) costs, including costs of payments, of printing and
distributing prospectuses, statements of additional
information and reports of the Fund to prospective
shareholders of the Fund;
(f) costs, including costs of payments, involved in preparing,
printing and distributing sales literature pertaining to the
Fund; and
(g) costs, including costs of payments, involved in obtaining
whatever information, analyses and reports with respect to
marketing and promotional activities on behalf of the Fund
that the Trust may, from time to time, deem advisable.
The Fund shall accrue and carry forward amounts reimbursable that are
not paid because they exceed 0.25% per annum of the average daily net assets of
the shares of the Fund ("Carry Forward Amounts") and shall pay such amounts
within the 0.25% per annum payment rate limitation so long as this Plan,
including any amendments hereto, is in effect.
B-2
<PAGE> 12
3. Quarterly Reports; Additional Information
An appropriate officer of PIC will provide to the Board of Trustees of
the Fund for review, at least quarterly, a written report specifying in
reasonable detail the amounts expended for Distribution Activities and the
purposes for which such expenditures were made in compliance with the
requirements of Rule 12b-1.
4. Effectiveness; Continuation.
The Plan shall not take effect until it has been approved by a vote of
a majority of the outstanding voting securities (as defined in the 1940 Act) of
the Fund.
If approved by a vote of a majority of the outstanding voting
securities of the Fund, the Plan shall, unless earlier terminated in accordance
with its terms, continue in full force and effect thereafter for so long as such
continuance is specifically approved at least annually by a majority of the
Board of Trustees of the Trust and a majority of the Rule 12b-1 Trustees by
votes cast in person at a meeting called for the purpose of voting on the
continuation of the Plan.
5. Termination.
The Plan may be terminated at any time by vote of a majority of the
Rule 12b-1 Trustees, or by vote of a majority of the outstanding voting
securities (as defined in the 1940 Act) of the Fund.
6. Amendments.
The Plan may not be amended to change the distribution expenses as
provided for in Section 2 hereof so as to increase materially the amounts
payable under the Plan unless such amendment shall be approved by the vote of a
majority of the outstanding voting securities (as defined in the 1940 Act) of
the Fund. All material amendments of the Plan, including the addition or
deletion of categories of expenditures which are reimbursable hereunder, shall
be approved by a majority of the Board of Trustees of the Trust and majority of
the Rule 12b-1 Trustees by vote cast in person at a meeting called for the
purpose of voting on the Plan.
7. Non-interested Trustees.
While the Plan is in effect, the selection and nomination of the
Trustees who are not "interested persons" of the Fund ("non-interested
Trustees") shall be committed to the discretion of the non-interested Trustees.
B-3
<PAGE> 13
8. Preservation of Materials.
The Fund shall preserve copies of the Plan and any related agreements
and all reports made pursuant to Section 3 hereof, for a period of not less than
six years from the date of effectiveness of the Plan, such agreements or
reports, and for at least the first two years in an easily accessible place.
9. Meanings of Certain Terms.
As used in the Plan, the terms, "interested person" and "majority of
the outstanding voting securities" will be deemed to have the same meaning that
those terms have under the 1940 Act and the rules and regulations under the 1940
Act, subject to any exemption that may be granted to the Trust or the Fund under
the 1940 Act by the Securities and Exchange Commission.
PIC Institutional Balanced Fund
By: ___________________________
B-4
<PAGE> 14
PROXY
SPECIAL MEETING OF SHAREHOLDERS OF
PIC INSTITUTIONAL BALANCED FUND - February 19, 1997
SOLICITED ON BEHALF OF
THE BOARDS OF TRUSTEES OF THE PIC INSTITUTIONAL BALANCED FUND
The undersigned hereby appoints Jeffrey J. Miller and Thad
Brown, and each of them, as proxies of the undersigned, each with the power to
appoint his substitute, for the Special Meeting of Shareholders of PIC
Institutional Balanced Fund (the "Fund"), a separate series of the PIC
Investment Trust (the "Trust") to be held on February 19, 1997 at the offices of
Provident Investment Counsel, 300 North Lake Avenue, Pasadena, California 91101
at 10:00 a.m., or at any and all adjournments thereof (the "Meeting"), to vote,
as designated below, all shares of the Fund held by the undersigned at the close
of business on January 15, 1997. Capitalized terms used without definition have
the meanings given to them in the accompanying Proxy Statement.
A SIGNED PROXY WILL BE VOTED IN FAVOR OF THE PROPOSED 12B-1 PLAN BELOW UNLESS
YOU HAVE SPECIFIED OTHERWISE. PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY.
YOU MAY VOTE ONLY IF YOU HELD SHARES IN THE FUND AT THE CLOSE OF BUSINESS ON
JANUARY 15, 1997. YOUR SIGNATURE AUTHORIZES THE PROXIES TO VOTE IN THEIR
DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING,
INCLUDING WITHOUT LIMITATION ALL MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
<PAGE> 15
(1) Approval of the 12b-1 Plan:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: _____________, 1997
____________________________________
Signature
____________________________________
Title (if applicable)
____________________________________
Signature (if held jointly)
____________________________________
Title (if applicable)
Please sign exactly as name or names appear on your shareholder account
statement. When signing as attorney, trustee, executor, administrator,
custodian, guardian or corporate officer, please give full title. If shares are
held jointly, each shareholder should sign.
<PAGE> 16
EXHIBIT A
COMPARATIVE EXPENSE INFORMATION
The following tables show the actual annual operating expenses of the
Fund for its fiscal year ended October 31, 1996, calculated as a percentage of
average net assets and the pro forma expenses assuming the proposed Plan had
been in effect during the entire fiscal year. As the Fund seeks to achieve its
investment objective by investing all of its assets in the PIC Balanced
Portfolio, the tables reflect the combined expenses of the Fund and the
Portfolio.
<TABLE>
<CAPTION>
WITHOUT A PLAN OF DISTRIBUTION WITH A PLAN OF DISTRIBUTION
- ------------------------------ ---------------------------
<S> <C> <C> <C>
Management fee (paid by the Portfolio) .60% Management fee (paid by the Portfolio) .60%
Other expenses of the Portfolio, after Other expenses of the Portfolio, after
reimbursement by PIC .20% reimbursement by PIC .20%
---- ----
TOTAL OPERATING EXPENSES OF THE PORTFOLIO .80% TOTAL OPERATING EXPENSES OF THE PORTFOLIO .80%
Administrative fee paid by the Fund to PIC .20% Administrative fee paid by the Fund to PIC, 0
12b-1 fee NONE after waiver by PIC
Other expenses of the Fund, after 12b-1 fee .25%
reimbursement by PIC .05% Other expenses of the Fund, after
---- reimbursement by PIC 0
----
TOTAL FUND OPERATING EXPENSES 1.05%
TOTAL FUND OPERATING EXPENSES 1.05%
</TABLE>
PIC waives its fees and reimburses the Fund for other expenses to the extent
necessary to ensure that total Fund operating expenses will not exceed 1.05% of
average net assets. Without this reimbursement, the total Fund operating
expenses during the last fiscal year of the Fund would have been 1.72%. Without
reimbursement by PIC and with the inclusion of the 12b-1 fee, the total
operating expenses of the Fund would be estimated to be 1.97%. PIC's
reimbursement is voluntary and may be terminated at any time.
EXAMPLE: Let's say, hypothetically, that the Fund's annual return is 5% and
that its operating expenses after waivers and reimbursements are exactly as
just described. For every $1,000 you invest, here's how much you would pay in
total expenses if your close your account after the number of years indicated
After 1 year $11
After 3 years $33
After 5 years $58
After 10 years $128
This example illustrates the effect of expenses, but it is not meant to suggest
actual or expected costs or returns, all of which may vary. The table above
summarizes the expenses of both the Portfolio and the Fund.
