Please read this prospectus before investing, and keep it on file for future
reference. It contains important information, including how the Fund invests and
the services available to shareholders.
To learn more about the Fund and its investments, you can obtain a copy of the
Fund's most recent financial reports and portfolio listing, or a copy of the
Statement of Additional Information (SAI) dated December 31, 1997. The SAI has
been filed with the Securities and Exchange Commission (SEC) and is incorporated
herein by reference (legally forms a part of this prospectus). For a free copy
of either document, call (800) 618-7643. The SEC maintains an internet site
(http://www.sec.gov) that contains the SAI, other material incorporated by
reference and other information about companies that file electronically with
the SEC.
Mutual fund shares are not deposits or obligations of, or guaranteed by, any
depository institution. Shares are not insured by the U.S. Government, the FDIC,
the Federal Reserve Board, or any other U.S. Government agency, and are subject
to investment risk, including the possible loss of principal.
The Fund, unlike many other mutual funds which directly acquire and manage their
own portfolios of securities, seeks to achieve its investment objective by
investing all of its assets in the PIC Mid Cap Portfolio. Investors should
carefully consider this investment approach. For additional information, see
"Structure of the Fund and the Portfolio" and "Investment Objectives and
Policies" in this prospectus.
Like all mutual funds, these securities have not been approved or disapproved by
the Securities and Exchange Commission nor has the Securities and Exchange
Commission passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
[LOGO] P*I*C
------------
MID CAP FUND
------------
This fund is a growth fund. It seeks to increase the value of your investment
over the long term. The fund invests primarily in equity securities of companies
with medium market capitalizations.
Prospectus
December 31, 1997
Provident Investment
Counsel
300 North Lake Avenue
Pasadena, Ca 91101
<PAGE>
<TABLE>
<CAPTION>
Contents
<S> <C>
Key Facts 3 The Fund at a Glance
3 Who May Want to Invest
3 Expenses
The Fund in Detail 4 Structure of the Fund and the Portfolios
5 Charter How the Fund is organized.
5 PIC The Fund's Advisor
6 Information About the Fund's Investments
The Fund's overall approach to investing.
7 Securities and Investment
Practices More information about how
the Fund invests.
8 Breakdown of Expenses How operating
costs are calculated and what they
include.
Your Account 10 Ways to Set Up Your Account
11 How to Buy Shares
11 How to Sell Shares
14 Investor Services Services to help you
manage your account.
Shareholder and Account Policies 14 Dividends, Capital Gains and Taxes
16 Transaction Details
Share price calculations and the timing of
purchases and redemptions.
18 Exchange Restrictions
General Information 19
</TABLE>
Prospectus 2
<PAGE>
Key Facts
The Fund at a Glance
Management: Provident Investment Counsel (PIC), located in Pasadena, California
since 1951, is the Fund's Advisor. At September 30, 1997, total assets under
PIC's management were over $20 billion.
Goal: Long term growth of capital (increase in the value of the Fund's shares).
As with any mutual fund, there is no assurance that the Fund will achieve its
goal.
Strategy: Invests in the PIC Mid Cap Portfolio, which invests mainly in equity
securities of companies with medium market capitalizations.
Who May Want to Invest
The Fund may be appropriate for investors who are willing to ride out stock
market fluctuations in pursuit of potentially above average long-term returns.
The Fund is designed for those who want to focus on medium capitalization stocks
in search of above average returns. A company's market capitalization is the
total market value of its outstanding common stock.
The value of the Fund's investments will vary from day to day, and generally
reflects market conditions, interest rates, and other company, political or
economic news. In the short term, stock prices can fluctuate dramatically in
response to these factors. The securities of smaller (including
medium-capitalization), less well-known companies may be more volatile than
those of larger companies. Over time, however, medium-capitalization stocks have
shown greater growth potential than those of larger-capitalization companies.
When you sell your shares, they may be worth more or less than what you paid for
them. By itself, the Fund does not constitute a balanced investment plan.
Expenses
Shareholder transactions expenses are charges you pay when you buy, sell or hold
shares in a fund.
Maximum sales charge None
Maximum sales charge
on reinvested dividends None
Deferred sales charge
on redemptions None
Annual Fund operating expenses are paid out of the Fund's assets. The Fund
indirectly pays an investment advisory fee equal to .70% of the Fund's average
net assets. It also incurs other expenses for services such as administrative
services, maintaining shareholder records and furnishing shareholder statements
and financial reports. The Fund's expenses are factored into its share price or
dividends
3 Prospectus
<PAGE>
and are not charged directly to shareholder accounts.
The following are projections based on estimated expenses, and are calculated as
a percentage of average net assets. PIC reimburses the Fund for any expenses in
excess of 0.99% of average net assets. Without this reimbursement, the total
fund operating expenses would be estimated to be 1.50% of average net assets.
Management fee (paid by
the Portfolio) .70%
Other expenses of the
Portfolio, after reimbursement
by PIC .20%
---
Total operating expenses of the
Portfolio .90%
Other expenses of the Fund,
after reimbursement by PIC .09%
---
Total Fund operating expenses .99%
Example: Let's say, hypothetically, that the Fund's annual return is 5% and that
its operating expenses are exactly as just described. For every $1,000 you
invest, here's how much you would pay in total expenses if you close your
account after the number of years indicated:
After 1 year $ 9
After 3 years $29
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 Fund in Detail
Structure of the Fund and the Portfolio
Unlike many other mutual funds which directly acquire and manage their own
portfolio securities, the Fund seeks to achieve its investment objective by
investing all of its assets in the PIC Mid Cap Portfolio. This Portfolio is a
separate registered investment company with the same investment objective as the
Fund. Since the Fund will not invest in any securities other than shares of the
Portfolio, investors in the Fund will acquire only an indirect interest in the
Portfolio. The Fund's and Portfolio's investment objective cannot be changed
without shareholder approval.
In addition to selling its shares to the Fund, the Portfolio may sell its shares
to other mutual funds or institutional investors. All investors in the Portfolio
invest on the same terms and conditions and pay a proportionate share of the
Portfolio's expenses.
The Fund's Trustees believe that this structure may enable the Fund to benefit
from certain economies of scale, based on the premise that certain of the
expenses of managing an investment portfolio are relatively fixed and that a
larger investment portfolio may
Prospectus 4
<PAGE>
therefore achieve a lower ratio of operating expenses to net assets. Investing
the Fund's assets in the Portfolio may produce other benefits resulting from
increased asset size, such as the ability to participate in transactions in
securities which may be offered in larger denominations than could be purchased
by the Fund alone.
The Fund's investment in the Portfolio may be withdrawn by the Fund's Board of
Trustees at any time if the Board determines that it is in the best interests of
the Fund to do so. For further information, see "Charter--PIC," "Information
aboutt the Fund's Investments" and "Securities and Investment Practices."
Charter
The PIC Mid Cap Fund is a mutual fund: an investment that pools shareholders'
money and invests it toward a specified goal. In technical terms, the Fund is a
diversified series of PIC Investment Trust, which is an open-end management
investment company, organized as a Delaware business trust on December 11, 1991.
The Fund is governed by a Board of Trustees, which is responsible for protecting
the interests of shareholders. The Trustees are experienced executives who meet
throughout the year to oversee the Fund's activities, review contractual
arrangements with companies that provide services to the Fund, and review
performance. The majority of Trustees are not otherwise affiliated with PIC.
The Fund may hold special meetings and mail proxy materials. These meetings may
be called to elect or remove Trustees, change fundamental policies, approve an
investment advisory contract, or for other purposes. Shareholders not attending
these meetings are encouraged to vote by proxy. The Fund will mail proxy
materials in advance, including a voting card and information about the
proposals to be voted on. The number of votes you are entitled to is based on
the number of shares you own.
PIC is the adviser to the PIC Mid Cap Portfolio, in which the Fund invests. An
investment committee of PIC formulates and implements an investment program for
the Fund, including determining which securities should be bought and sold.
PIC may use broker-dealers that sell shares of the Fund to carry out
transactions for the Fund, provided that the Fund receives brokerage services
and commission rates comparable to those of other broker-dealers.
PIC traces its origins to an investment partnership formed
5 Prospectus
<PAGE>
in 1951. It is now an indirect, wholly owned subsidiary of United Asset
Management Corporation (UAM), a publicly owned corporation with headquarters
located at One International Place, Boston, MA 02110. UAM is principally
engaged, through affiliated firms, in providing institutional investment
management services.
Information About the Fund's Investments
The Fund seeks long term growth of capital by investing in the PIC Mid Cap
Portfolio, which in turn invests primarily in equity securities of companies
with medium market capitalizations. Because the investment characteristics of
the Fund will correspond directly to those of the Portfolio, the following is a
discussion of the various investments of, and techniques employed by, the
Portfolio.
PIC will invest at least 65%, and normally at least 95%, of the Portfolio's
total assets in these securities. The Portfolio has flexibility, however, to
invest the balance in other market capitalizations and security types.
Medium market capitalization companies are those whose market capitalization
falls within the range of $500 million to $5 billion at the time of the
Portfolio's investment. Companies whose capitalization falls outside this range
after purchase continue to be considered medium capitalization for the purposes
of the Portfolio's investment policy. Investing in medium capitalization stocks
may involve greater risk than investing in large capitalization stocks, since
they can be subject to more abrupt or erratic movements in value. However, they
tend to involve less risk than stocks of small capitalization companies.
The value of the Portfolio's domestic and foreign investments varies in response
to many factors. Stock values fluctuate in response to the activities of
individual companies and general market and economic conditions. Investments in
foreign securities may involve risks in addition to those of U.S. investments,
including increased political and economic risk, as well as exposure to currency
fluctuations.
As a mutual fund, the Portfolio seeks to spread investment risk by diversifying
its holdings among many companies and industries. Of course, when you sell your
shares of the Fund, they may be worth more or less than what you paid for them.
Prospectus 6
<PAGE>
PIC normally invests the Portfolio's assets according to its investment
strategy. The Portfolio also reserves the right to invest without limitation in
short term instruments for temporary, defensive purposes.
Securities and Investment Practices.
The following pages contain more detailed information about the types of
instruments in which the Portfolio may invest, and strategies PIC may employ in
pursuit of the Portfolio's investment objective. A summary of risks and
restrictions associated with these instrument types and investment practices is
included as well. A complete listing of the Fund's policies and limitations and
more detailed information about the Portfolio's investments is contained in the
SAI. Policies and limitations are considered at the time of purchase; the sale
of instruments is not required in the event of a subsequent change in
circumstances.
PIC may not buy all of these instruments or use all of these techniques to the
full extent permitted unless it believes that doing so will help the Portfolio
achieve its goals. Current holdings and recent investment strategies are
described in the Fund's financial reports which are sent to shareholders twice a
year. For a free SAI or financial report, call (800) 618-7643.
Equity Securities are common stocks and other kinds of securities that have the
characteristics of common stocks. These other securities include bonds,
debentures and preferred stocks which can be converted into common stocks. They
also include warrants and options to purchase common stocks.
Restriction: With respect to 75% of total assets, the Portfolio may not own more
than 10% of the outstanding voting securities of a single issuer.
Short Term Investments are debt securities that mature within a year of the date
they are purchased by the Portfolio. Some specific examples of short term
investments are commercial paper, bankers' acceptances, certificates of deposit
and repurchase agreements.
Restriction: The Portfolio will only purchase short term investments which are
"high quality." High quality means the investments have been rated A-1 by S&P or
Prime-1 by Moody's, or have an issue of debt securities outstanding rated at
least A by S&P or Moody's. The term also applies to short term investments that
PIC believes are comparable in quality to those with an A-1 or Prime-1 rating.
U.S. Government securities are always considered to be high quality.
7 Prospectus
<PAGE>
Repurchase Agreements. In a repurchase agreement, the Portfolio buys a security
at one price and simultaneously agrees to sell it back at a higher price. Delays
or losses could result if the other party to the agreement defaults or becomes
insolvent.
Exposure to Foreign Markets. Foreign securities and securities issued by U.S.
entities with substantial foreign operations may involve additional risks and
considerations. These include risks relating to political or economic conditions
in foreign countries, fluctuations in foreign currencies, withholding or other
taxes, operational risks, increased regulatory burdens and the potentially less
stringent investor protection and disclosure standards of foreign markets. All
of these factors can make foreign investments, especially those in developing
countries, more volatile.
Restriction: The Portfolio may invest no more than 20% of its total assets in
foreign securities, and it will only purchase foreign securities or American
Depositary Receipts which are listed on a national securities exchange or
included in the NASDAQ National Market System.
Options and Futures. The Portfolio has the right to use options and futures to
hedge its investments in securities, but PIC does not expect to use these
instruments during this fiscal year. The Fund will advise you before any
investment will be made in options or futures. See the SAI for details.
Fundamental Investment Policies and Restrictions. Some of the policies and
restrictions discussed on this and the preceding pages are fundamental; that is,
subject to change only by shareholder approval. The following paragraph states
all those that are fundamental. All policies stated throughout the prospectus,
other than those identified in the following paragraph, can be changed without
shareholder approval.
The Fund seeks long term growth of capital. The Portfolio, with respect to 75%
of total assets, may not invest more than 5% of its total assets in any one
issuer and may not own more than 10% of the outstanding voting securities of a
single issuer. The Portfolio may not invest more than 25% of its total assets in
anyone industry.
Breakdown of Expenses
Like all mutual funds, the Fund pays fees related to its daily operations.
Expenses paid out of the Fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted from
shareholder accounts.
Prospectus 8
<PAGE>
The Portfolio pays an investment advisory fee to PIC each month for managing its
investments, at the annual rate of 0.70% of the Fund's average net assets.
While the investment advisory fee is a significant component of the Portfolio's
(and thus the Fund's) annual operating costs, the Fund also pays other expenses.
The Fund pays a fee to PIC for certain administrative services PIC provides. The
Fund and the Portfolio each pay a monthly administration fee to Investment
Company Administration Corporation for managing some of their business affairs.
The Portfolio pays a fee at the annual rate of 0.10% of its average net assets,
and the Fund pays an annual fee of $15,000. The Fund and the Portfolio also pay
other expenses, such as legal, audit, custodian and transfer agency fees, as
well as the compensation of Trustees who are not affiliated with PIC.
PIC expects that the Portfolio's portfolio turnover rate will normally not
exceed 100%.
PIC has agreed to reimburse the Fund for investment advisory fees and other
expenses above 0.99% of the Fund's average net assets. PIC retains the ability
to be repaid by the Fund if expenses subsequently fall below the specified limit
within the next three years. This reimbursement arrangement, which may be
terminated at any time without notice, will decrease the Fund's expenses and
boost its performance.
9 Prospectus
<PAGE>
Ways to Set Up Your Account
Individual or Joint Tenant
For your general investment needs
Individual accounts are owned by one person. Joint accounts can have two or more
owners (tenants).
- --------------------------------------------------------------------------------
Retirement
To shelter your retirement savings from taxes
Retirement plans allow individuals to shelter investment income and capital
gains from current taxes. In addition, contributions to these accounts may be
tax deductible. Retirement accounts require special applications and typically
have lower minimums.
o Individual Retirement Accounts (IRAs) allow anyone of legal age and under 70
1/2 with earned income to invest up to $2000 per tax year. Individuals can
also invest in a spouse's IRA if the spouse has earned income of less than
$250.
o Rollover IRAs retain special tax advantages for certain distributions from
employer-sponsored retirement plans.
o Keogh or Corporate Profit Sharing and Money Purchase Pension Plans allow
self-employed individuals or small business owners (and their employees) to
make tax-deductible contributions for themselves and any eligible employees
up to $30,000 per year.
o Simplified Employee Pension Plans (SEP-IRAs) provide small business owners
or those with self-employed income (and their eligible employees) with many
of the same advantages as a Keogh, but with fewer administrative
requirements.
o 403(b) Custodial Accounts are available to employees of most tax-exempt
institutions, including schools, hospitals and other charitable
organizations.
o 401(k) Programs allow employees of corporations of all sizes to contribute a
percentage of their wages on a tax-deferred basis. These accounts need to be
established by the trustee of the plan.
- --------------------------------------------------------------------------------
Gifts or Transfers to Minor (UGMA, UTMA)
To invest for a child's education or other future needs
These custodial accounts provide a way to give money to a child and obtain tax
benefits. An individual can give up to $10,000 a year per child without paying
federal gift tax. Depending on state laws, you can set up a custodial account
under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors
Act (UTMA).
- --------------------------------------------------------------------------------
Trust
For money being invested by a trust
The trust must be established before an account can be opened.
- --------------------------------------------------------------------------------
Business or Organization
For investment needs of corporations, associations, partnerships or other groups
Does not require a special application.
Prospectus 10
<PAGE>
How to Buy Shares
Once each business day, the Fund calculates its share price: The share price is
the Fund's net asset value (NAV). Shares are purchased at the next share price
calculated after your investment is received and accepted. Share price is
normally calculated at 4 p.m. Eastern time.
If you are investing through a tax-sheltered retirement plan, such as an IRA,
for the first time, you will need a special application. Retirement investing
also involves its own investment procedures. Call (800) 618-7643 for more
information and a retirement application.
If you buy shares by check and then sell those shares within two weeks, the
payment may be delayed for up to seven business days to ensure that your
purchase check has cleared.
Rodney Square Management Corporation (RSMC) is the Fund's Transfer Agent; its
address is 1105 N. Market Street, 3rd floor, Wilmington, Delaware 19890, and its
mailing address is P.O. Box 8987, Wilmington, DE 19899.
First Fund Distributors, Inc., 4455 E. Camelback Road, Suite 261E, Phoenix AZ
85018, is the Trust's principal underwriter.
Minimum Investments
To Open an Account $2,000
For retirement accounts $500
To Add to an Account $250
For retirement plans $250
Through automatic
investment plans $100
Minimum Balance $1,000
For retirement accounts $500
For Information: (800) 618-7643
To Invest By Mail:
PIC Funds
P.O. Box 8981
Wilmington, DE 19899
By Wire: Call:
(800) 618-7643 to set
up an account and
arrange a wire transfer
How to Sell Shares
You can arrange to take money out of your account at any time by selling
(redeeming) some or all of your shares. Your shares will be sold at the next
share price calculated after your order is received and accepted. Share price is
normally calculated at 4 p.m. Eastern time.
11 Prospectus
<PAGE>
To sell shares in a non-retirement account, you may use any of the methods
described on these two pages.
If you are selling some but not all of your shares, leave at least $1,000 worth
of shares in the account to keep it open ($500 for retirement accounts).
Certain requests must include a signature guarantee. It is designed to protect
you and the Fund from fraud. Your request must be made in writing and include a
signature guarantee if any of the following situations apply:
o You wish ro redeem more than $100,000 worth of shares,
o Your account registration has changed within the last 30 days,
o The check is being mailed to a different address from the one on your
account (record address), or
o The check is being made payable to someone other than the account owner.
You should be able to obtain a signature guarantee from a bank, broker-dealer,
credit union (if authorized under state law), securities exchange or
association, clearing agency or savings association. A notary public cannot
provide a signature guarantee.
Selling Shares in Writing
Write a "letter of instruction" with:
o Your name,
o Your Fund account number,
o The dollar amount or number of shares to be redeemed, and
o Any other applicable requirements listed in the table at right.
o Unless otherwise instructed, PIC will send a check to the record address.
Mail your letter to:
PIC Funds
P.O. Box 8987
Wilmington, DE 19899
Prospectus 12
<PAGE>
Account Type Special Requirements
Phone All account types Maximum check
(800) 618-7643 except retirement request: $100,000
- --------------------------------------------------------------------------------
Mail or in Person Individual, Joint Tenant, o The letter of instructions
Sole Proprietorship, must be signed be all
UGMA, UTMA persons required to sign for
transactions, exactly as
their names appear on the
account.
Retirement Account o The account owner should
complete a retirement
distribution form. Call (800)
618-7643 to request one.
Trust o The trustee must sign the
letter indicating capacity as
trustee. If the trustee's
name is not in the account
registration, provide a copy
of the trust document
certified within the last 60
days.
Business or Organization o At least one person
authorized by corporate
resolutions to act on the
account must sign the
letter.
- --------------------------------------------------------------------------------
Wire Executor, Administrator, o Include a corporate
Conservator, Guardian resolution with corporate
seal or a signature
guarantee.
All account types o Call (800) 618-7643 for
except retirement instructions.
o You must sign up for the
wire feature before using it.
To verify that it is in place,
call (800) 618-7643.
Minimum wire: $5,000.
o Your wire redemption
request must be received
by the Fund before 4 p.m.
Eastern time for money to
be wired the next
business day.
13 Prospectus
<PAGE>
Investor Services
PIC provides a variety of services to help you manage your account.
Information Services
PIC's telephone representatives can be reached at (800) 618-7643. Statements and
reports that PIC sends to you include the following:
o Confirmation statements (after every transaction that affects your account
balance or your account registration)
o Financial reports (every six months)
Transaction Services
Exchange privilege. You may sell your fund shares and buy shares of other PIC
funds by telephone or in writing without an exchange fee.
Note that exchanges into the Fund are limited to four per calendar year, and
that they may have tax consequences for you.
Systematic withdrawal plans let you set up periodic redemptions from your
account.
Regular Investment Plans
One easy way to pursue your financial goals is to invest money regularly. PIC
offers convenient services that let you transfer money into your fund account,
or between fund accounts, automatically. While regular investment plans do not
guarantee a profit and will not protect you against loss in a declining market,
they can be an excellent way to invest for retirement, a home, educational
expenses, and other long term financial goals. Certain restrictions apply for
retirement accounts. Call (800) 618-7643 for more information.
Dividends, Capital Gains, and Taxes
The Fund distributes substantially all of its net income and capital gains, if
any, to shareholders each year. Normally, dividends and capital gains are
distributed in December.
Distribution Options
When you open an account, specify on your application how you want to receive
your distributions. If the option you prefer is not listed on the application,
call (800) 618-7643 for instructions. The Fund offers three options:
1. Reinvestment Option. Your dividend and capital gain distributions will be
automatically reinvested in additional shares of the Fund. If you do not
indicate a choice on
Prospectus 14
<PAGE>
your application, you will be assigned this option.
2. Income-Earned Option. Your capital gain distributions will be automatically
reinvested, but you will be sent a check for each dividend distribution.
3. Cash Option. You will be sent a check for your dividend and capital gain
distributions. For retirement accounts, all distributions are automatically
reinvested. When you are over 59 1/2 years old, you can receive distributions in
cash.
Understanding Distributions
As a Fund shareholder, you are entitled to your share of the Fund's net
income and gains on its investments. The Fund passes its earnings along to
its investors as distributions.
The Fund earns dividends from stocks and interest from short term
investments. These are passed along as dividend distributions. The Fund
realizes capital gains whenever it sells securities for a higher price than
it paid for them. These are passed along as capital gain distributions.
When the Fund deducts a distribution from its NAV, the reinvestment price is the
Fund's NAV at the close of business that day. Cash distribution checks will be
mailed within seven days.
Taxes
As with any investment, you should consider how your investment in the Fund will
be taxed. If your account is not a tax-deferred retirement account, you should
be aware of these tax implications.
Taxes on distributions.
Distributions are subject to federal income tax, and may also be subject to
state or local taxes. If you live outside the United States, your distributions
could also be taxed by the country in which you reside. Your distributions are
taxable when they are paid, whether you take them in cash or reinvest them.
However, distributions declared in December and paid in January are taxable as
if they were paid on December 31.
For federal tax purposes, the Fund's income and short term capital gain
distributions are taxed as dividends; long term capital gain distributions are
taxed as long term capital gains. Every January, PIC will send you and the IRS a
statement showing the taxable distributions.
Taxes on transactions. Your redemptions - including exchanges to other PIC funds
- - are subject to capital gains tax. A capital gain or loss is the difference
between the cost of your shares and the price you receive when you sell them.
15 Prospectus
<PAGE>
Whenever you sell shares of the Fund, PIC will send you a confirmation statement
showing how many shares you sold and at what price. You will also receive a
consolidated transaction statement every January. However, it is up to you or
your tax preparer to determine whether the sales resulted in a capital gain and,
if so, the amount of the tax to be paid. Be sure to keep your regular account
statements; the information they contain will be essential in calculating the
amount of your capital gains.
"Buying a dividend." If you buy shares just before the Fund deducts a
distribution from its NAV, you will pay the full price for the shares and then
receive a portion of the price back in the form of a taxable distribution.
There are tax requirements that all funds must follow in order to avoid federal
taxation. In its effort to adhere to these requirements, the Fund may have to
limit its investment activity in some types of instruments.
Transaction Details
The Fund is open for business each day the New York Stock Exchange (NYSE) is
open. PIC calculates the Fund's NAV as of the close of business of the NYSE,
normally 4 p.m. Eastern time.
The Fund's NAV is the value of a single share. The NAV is computed by adding the
value of the Fund's investments, cash, and other assets, subtracting its
liabilities and then dividing the result by the number of shares outstanding.
The NAV is redemption price (price to sell one share).
The Fund's assets are valued primarily on the basis of market quotations. If
quotations are not readily available, assets are valued by a method that the
Board of Trustees believes accurately reflects fair value.
When you sign your account application, you will be asked to certify that your
Social Security or taxpayer identification number is correct and that you are
not subject to 31% withholding for failing to report income to the IRS. If you
violate IRS regulations, the IRS can require a fund to withhold 31% of your
taxable distributions and redemptions.
You may initiate many transactions by telephone. PIC may only be liable for
losses resulting from unauthorized transactions if it does not follow reasonable
procedures designed to verify the identity of the caller. PIC will request
personalized security codes or other information, and may also record calls. You
should verify the accuracy of your confirmation statements
Prospectus 16
<PAGE>
immediately after you receive them. If you do not want the liability to redeem
or exchange by telephone, call PIC for instructions.
The Fund reserves the right to suspend the offering of shares for a period of
time. The Fund also reserves the right to reject any specific purchase order,
including certain purchases by exchange. See "Exchange Restrictions" on page 18.
Purchase orders may be refused if, in PIC's opinion, they would disrupt
management of the Fund.
When you place an order to buy shares, your order will be processed at the next
NAV calculated after your order is received and accepted. Note the following:
o All of your purchases must be made in U.S. dollars, and checks must be drawn
on U.S. banks.
o PIC does not accept cash.
o When making a purchase with more than one check, each check must have a
value of at least $50.
o The Fund reserves the right to limit the number of checks processed at one
time.
o If your check does not clear, your purchase will be canceled and you could
be liable for any losses or fees the Fund or its transfer agent has
incurred.
To avoid the collection period associated with check purchases, consider buying
shares by bank wire, U.S. Postal money order, U.S. Treasury check, Federal
Reserve check, or direct deposit instead.
You may buy shares of the Fund or sell them through a broker, who may charge you
a fee for this service. If you invest through a broker or other institution,
read its program materials for any additional service features or fees that may
apply.
Certain financial institutions that have entered into sales agreements with PIC
may enter confirmed purchase orders on behalf of customers by phone, with
payment to follow no later than the time when the Fund is priced on the
following business day. If payment is not received by that time, the financial
institution could be held liable for resulting fees or losses.
When you place an order to sell shares, your shares will be sold at the next NAV
calculated after your request is received and accepted. Note the following:
o Normally, redemption proceeds will be mailed to you on the next business
day, but if making immediate payment could adversely
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affect the Fund, it may take up to seven days to pay you.
o Redemptions may be suspended or payment dates postponed when the NYSE is
closed (other than weekends or holidays), when trading on the NYSE is
restricted, or as permitted by the SEC.
o PIC reserves the right to deduct an annual maintenance fee of $12.00 from
accounts with a value of less that $2,500. It is expected that accounts will
be valued on the second Friday in November of each year. Accounts opened
after September 30 will not be subject to the fee for that year. The fee,
which is payable to the transfer agent, is designed to offset in part the
relatively higher cost of servicing smaller accounts.
Exchange Restrictions
As a shareholder, you have the privilege of exchanging shares of the Fund for
shares of other PIC funds. However, you should note the following:
o The fund you are exchanging into must be registered for sale in your state.
o You may only exchange between accounts that are registered in the same name,
address, and taxpayer identification number.
o Before exchanging into a fund, read its prospectus.
o Exchanges may have tax consequences for you.
o Because excessive trading can hurt fund performance and shareholders, the
Fund reserves the right to temporarily or permanently terminate the exchange
privilege of any investor who makes more than four exchanges out of the Fund
per calendar year. Accounts under common ownership or control, including
accounts with the same taxpayer identification number, will be counted
together for the purposes of the four exchange limit.
o The exchange limit may be modified for accounts in certain institutional
retirement plans to conform to plan exchange limits and Department of Labor
regulations. See your plan materials for further information.
o The Fund reserves the right to refuse exchange purchases by any person or
group if, in PIC's judgment, the Fund would be unable to invest the money
effectively in accordance with its investment objective and policies, or
would otherwise potentially be adversely affected.
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o Your exchanges may be restricted or refused if the Fund receives or
anticipates simultaneous orders affecting significant portions of the Fund's
assets. In particular, a pattern of exchanges that coincides with a "market
timing" strategy may be disruptive to the Fund.
Although the Fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The Fund
reserves the right to terminate or modify the exchange privilege in the future.
General Information
The Fund is one of a series of shares, each having separate assets and
liabilities, of the Trust. The Board of Trustees may at its own discretion,
create additional series of shares. The Declaration of Trust contains an express
disclaimer of shareholder liability for its acts or obligations and provides for
indemnification and reimbursement of expenses out of the Trust's property for
any shareholder held personally liable for its obligations.
The Declaration of Trust further provides the Trustees will not be liable for
errors of judgment or mistakes of fact or law, but nothing in the Declaration of
Trust protects a Trustee against any liability 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.
Shareholders are entitled to one vote for each full share held (and fractional
votes for fractional shares) and may vote in the election of Trustees and on
other matters submitted to meetings of shareholders. It is not contemplated that
regular annual meetings of shareholders will be held. Rule 18f-2 under the Act
provides that matters submitted to shareholders be approved by a majority of the
outstanding securities of each series, unless it is clear that the interests of
each series in the matter are identical or the matter does not affect a series.
However, the rule exempts the selection of accountants and the election of
Trustees from the separate voting requirements. Income, direct liabilities and
direct operating expenses of each series will be allocated directly to each
series, and general liabilities and expenses of the Trust will be allocated
among the series in proportion to the total net assets of each series by the
Board of Trustees.
The Declaration of Trust provides that the shareholders have the right, upon the
declaration in writing or vote of more than two-thirds of its outstanding
shares, to remove a Trustee. The
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Trustees will call a meeting of shareholders to vote on the removal of a Trustee
upon the written request of the record holders of ten per cent of its shares. In
addition, ten shareholders holding the lesser of $25,000 worth or one per cent
of the shares may advise the Trustees in writing that they wish to communicate
with other shareholders for the purpose of requesting a meeting to remove a
Trustee. The Trustees will then, if requested by the applicants, mail at the
applicants' expense the applicants' communication to all other shareholders.
Except for a change in the name of the Trust, no amendment may be made to the
Declaration of Trust without the affirmative vote of the holders of more than
50% of its outstanding shares. The holders of shares have no pre-emptive or
conversion rights. Shares when issued are fully paid and non-assessable, except
as set forth above. The Trust may be terminated upon the sale of its assets to
another issuer, if such sale is approved by the vote of the holders of more than
50% of its outstanding shares, or upon liquidation and distribution of its
assets, if approved by the vote of the holders of more than 50% of its
outstanding shares. If not so terminated, the Trust will continue indefinitely.
Prospectus 20
