Prospectus Supplement
Calvert World Values Fund, Inc.
Calvert Capital Accumulation Fund
Supplement to October 31, 1994 Prospectus
Date of Supplement: September 30, 1995
In the paragraph, "Redemptions From Other Mutual Funds," on page 31 of the
Prospectus, the date in the last sentence should be changed from December 31,
1994 to December 31, 1995. You or your broker must notify the Fund at the time
of the purchase to be eligible for this provision.
PROSPECTUS
October 31, 1994
as revised November 4, 1994
CALVERT WORLD VALUES
CAPITAL ACCUMULATION FUND
4550 Montgomery Avenue, Bethesda, Maryland 20814
INVESTMENT OBJECTIVE
Calvert Capital Accumulation Fund (the "Fund") is a nondiversified series of
Calvert World Values Fund, Inc., an open-end management investment company. The
Fund seeks long-term capital appreciation by investing primarily in the stock of
small- to medium-sized companies using the talent of multiple investment
subadvisors. The market capitalization of companies chosen for investment will
generally range between $100 million and $5 billion, but the Fund may also
invest in larger and smaller companies as deemed appropriate. Other investments
may include foreign securities, convertible issues, and certain options and
futures transactions. The Fund will take reasonable risks in seeking to achieve
its investment objective. There is, of course, no assurance that the Fund will
be successful in meeting its objective since there is risk involved in the
ownership of all equity securities.
RESPONSIBLE INVESTING
To the extent possible, investments are made in enterprises that make a
significant contribution to our society through their products and services and
through the way they do business.
PURCHASE INFORMATION
The Fund offers two classes of shares with different expense levels and sales
charges. If you purchase Class A shares you will pay a sales charge at the time
you purchase the shares ("front-end sales charge"), and the Fund pays Rule 12b-1
fees. Class C shares, which are not available through all dealers, have no
front-end or back-end sales charge, but have higher expenses than Class A
shares, including higher Rule 12b-1 fees. The Class you choose depends on the
amount of the purchase, the length of time you expect to hold the shares, and
other circumstances. See Alternative Sales Options" for further details.
TO OPEN AN ACCOUNT
Call your investment professional, or complete and return the enclosed Account
Application. Minimum initial investment is $2,000 (may be lower for certain
retirement plans).
ABOUT THIS PROSPECTUS
Please read this Prospectus for information you should know before investing,
and keep it for future reference. A Statement of Additional Information dated
October 31, 1994) has been filed with the Securities and Exchange Commission and
is incorporated by reference. This free Statement is available upon request from
the Fund: 800-368-2748.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE FEDERAL OR
ANY STATE SECURITIES COMMISSION PASSED ON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK, AND ARE NOT INSURED BY THE FDIC OR ANY OTHER AGENCY.
THE FUND MAY NOT BE AVAILABLE FOR SALE IN YOUR STATE. PLEASE CHECK WITH CALVERT
OR YOUR INVESTMENT PROFESSIONAL TO DETERMINE WHETHER YOU MAY PURCHASE FUND
SHARES.
<TABLE>
<CAPTION>
FUND EXPENSES
Class A Class C
<S> <C> <C>
A. Shareholder Transaction Costs
Maximum Front-End Sales Charge on 4.75% None
Purchases (as a percentage of offering
price)
Maximum Contingent Deferred Sales Charge None None
B. Annual Fund Operating Expenses Est. for
first year of operations
(as a percentage of net assets)
Management Fees (after waiver) 0.70% 0.70%
Rule 12b-1 Fees 0.25% 1.00%
Other Expenses 0.55% 0.55%
Total Fund Operating Expenses 1.50% 2.25%
</TABLE>
Example: You would pay the following expenses on a $1,000 investment, assuming
5% annual return:
Class 1 Year 3 Years
Class A (assumes payment of
maximum initial sales charge) $62 $93
Class C $23 $70
The example should not be considered a representation of past or future
expenses. Actual expenses and return may be higher or lower than those shown.
Explanation of Table: The purpose of the table is to assist you in understanding
the various costs and expenses that an investor in the Fund would bear directly
(shareholder transaction costs) or indirectly (annual fund operating expenses).
A. Shareholder Transaction Costs are charges you pay when you buy or sell shares
of the Fund. See "Reduced Sales Charges" to see if you qualify for possible
reductions in the sales charge. If you request a wire redemption of less than
$1,000, you will be charged a $5 wire fee.
B. Annual Fund Operating Expenses. Management Fees are paid by the Fund to
Calvert Asset Management Company, Inc. ("Advisor") for managing the Fund's
investments and business affairs. The Advisor may voluntarily defer fees or
assume expenses of the Fund. Without deferrals or waivers, Management fees would
be 0.90%. The Investment Advisory Agreement provides that the Advisor may, to
the extent permitted by law, later recapture any fees it deferred or expenses it
assumed during the two prior years. Beginning after the twenty-fourth month of
operations, the annual advisory fee may be as high as 1.05% or as low as 0.75%
of the Fund's average daily net assets. Management fees include the subadvisory
fees paid by the Advisor and the administrative services fee paid to Calvert
Administrative Services Company. The Fund incurs Other Expenses for maintaining
shareholder records, furnishing shareholder statements and reports, and other
services. Management Fees and Other Expenses have already been reflected in the
Fund's daily share price and are not charged directly to individual shareholder
accounts. Please refer to "Management of the Fund" for further information.
The Fund's Rule 12b-1 fees include an asset-based sales charge. Thus, long-term
shareholders in the Fund may pay more in total sales charges than the economic
equivalent of the maximum front-end sales charge permitted by rules of the
National Association of Securities Dealers, Inc. Please see the section of the
Prospectus entitled "Alternative Sales Options" for information on Rule 12b-1
fees for each Class.
INVESTMENT OBJECTIVE AND POLICIES
The Fund seeks to provide long-term capital appreciation by investing, under
normal market conditions, at least 65% of its assets in the equity securities of
small- to mid-sized companies.
The Fund seeks to provide long-term capital appreciation by investing primarily
in a nondiversified portfolio of the equity securities of small- to mid-sized
companies that are undervalued but demonstrate a potential for growth. The Fund
will rely on its proprietary research to identify stocks that may have been
overlooked by analysts, investors, and the media, and which generally have a
market value between $100 million and $5 billion, but which may be larger or
smaller as deemed appropriate. Investments may also include, but are not limited
to, preferred stocks, foreign securities, convertible securities, bonds, notes
and other debt securities. The Fund may use certain futures and options, invest
in repurchase agreements, and lend its portfolio securities. The Fund will take
reasonable risks in seeking to achieve its investment objective. There is, of
course, no assurance that the Fund will be successful in meeting its objective
since there is risk involved in the ownership of all equity securities. The
Fund's investment objective is not fundamental and may be changed without
shareholder approval. The Fund will notify shareholders at least thirty days in
advance of a change in the investment objective of the Fund so that shareholders
may determine whether the Fund's goals continue to meet their own.
The Fund has a pool of several portfolio managers from which to choose.
The Fund will use the services of several investment subadvisors as portfolio
managers in selecting companies in which to invest. The portfolio managers will
select investments by examining such factors as company growth prospects,
industry economic outlook, new product development, management, security value,
risk, and financial characteristics. Because of this multi-manager approach, the
Fund may benefit from more than one investment strategy in seeking to achieve
its goals. The Fund may employ "growth managers," who generally concentrate on
stocks that have demonstrated, or are expected to produce, earnings growth rates
significantly greater than the market as a whole, as well as "value managers,"
who tend to make stock selections on the basis of perceived relative value as
determined by a defined model in a bottom-up approach. The Advisor will use the
services of a consultant to help it determine the appropriate mix of management
styles to be employed at any given time in an attempt to take advantage of
changing market conditions by allocating asset management among the selection of
talent in the Fund's management pool.
INVESTMENT TECHNIQUES AND RISKS
Small Cap Issuers
The securities of small-cap issuers tend to be less actively traded than the
securities of larger issuers, may trade in a more limited volume, and may change
in value more abruptly than securities of larger companies. Information
concerning these securities may not be readily available so that the companies
may be less actively followed by stock analysts. Small-cap issuers do not
usually participate in market rallies to the same extent as more widely-known
securities, and they tend to have a relatively higher percentage of insider
ownership. The portfolio turnover rate of advisors investing in small-cap stocks
tends to range between 100-200%. There is no limit on the percentage of assets
that may be invested in small-cap issuers.
Temporary defensive positions
Under normal market conditions the Fund strives to be fully invested in
securities. However, for temporary defensive purposes -- which may include a
lack of adequate purchase candidates or an unfavorable market environment -- the
Fund may invest up to 100% of its assets in cash or cash equivalents. Cash
equivalents include instruments such as, but not limited to, U.S. government and
agency obligations, certificates of deposit, bankers' acceptances, time
deposits, commercial paper, short-term corporate debt securities and repurchase
agreements.
The Fund currently intends to invest in no more than 5% of its assets in
noninvestment-grade debt obligations
Although the Fund invests primarily in equity securities, it may invest in debt
securities. These debt securities may consist of investment-grade and
noninvestment-grade obligations. Investment-grade obligations are those which,
at the date of investment, are rated within the four highest grades established
by Moody's Investors Services, Inc. (Aaa, Aa, A, or Baa) or by Standard and
Poor's Corporation (AAA, AA, A, or BBB). Noninvestment-grade
(high-yield/high-risk, or junk bond) securities are those rated below Baa or
BBB, or unrated obligations that the investment subadvisor has determined are
not investment-grade; such securities are speculative, and the Fund currently
intends to limit such investments to 5% of its assets. The Fund will not buy
debt securities rated lower than C.
Interest-rate risk
All fixed income instruments are subject to interest-rate risk: that is, if
market interest rates rise, the current principal value of a bond will decline.
In general, the longer the maturity of the bond, the greater the decline in
value will be.
Noninvestment-grade debt obligations involve greater risks than investment-grade
debt obligations
Noninvestment-grade securities tend to be less sensitive to interest rate
changes than higher-rated investments, but are more sensitive to adverse
economic changes and individual corporate developments. This may affect the
issuer's ability to make principal and interest payments on the debt obligation.
There is also a greater risk of price declines due to changes in the issuer's
creditworthiness. Because the market for lower-rated securities may be less
active ("thinner") than for higher-rated securities, it may be difficult for the
fund to sell the securities. Because of a lack of objective data, a
thinly-traded market may make it difficult to value the securities, so that the
Board of Directors may have to exercise its judgment in assigning a value. See
the Appendix in the Statement of Additional Information for more information on
bond ratings.
The Fund may use options and futures as defensive strategies
The Fund may attempt to reduce the overall risk of its investments by using
options and and futures contracts. An option is a legal contract that gives the
holder the right to buy or sell a specified amount of the underlying interest at
a fixed or determinable price (called the exercise or strike price) upon
exercise of the option. A futures contract is an agreement to take delivery or
to make delivery of a standardized quantity and quality of a certain commodity
during a particular month in the future at a specified price. The Subadvisor
will make decisions whether to invest in these instruments based on market
conditions, regulatory limits and tax considerations. If this strategy is used,
the Fund may be required to cover assets used for this purpose in a segregated
account for the protection of shareholders. See the Statement of Additional
Information for more detail about these strategies.
Risks of using defensive strategies
There can be no assurance that engaging in options, futures, or any other
defensive strategy will be successful. While defensive strategies are designed
to protect the Fund from potential declines, if the Subadvisor misgauges market
values, interest rates, or other economic factors, the Fund may be worse off
than had it not employed the defensive strategy. While the Subadvisor attempts
to determine price movements and thereby prevent declines in the value of
portfolio holdings, there is a risk of imperfect or no correlation between price
movements of portfolio investments and instruments used as part of a defensive
strategy so that a loss is incurred. While defensive strategies can reduce the
risk of loss, they can also reduce the opportunity for gain since they offset
favorable price movements. The use of defensive strategies may result in a
disadvantage to the Fund if the Fund is not able to purchase or sell a portfolio
holding at an optimal time due to the need to cover its transaction in its
segregated account, or due to the inability of the Fund to liquidate its
position because of its relative illiquidity.
Repurchase agreements
Repurchase agreements are arrangements under which the Fund buys securities and
the seller simultaneously agrees to repurchase the securities at a specified
time and price. The Fund may engage in repurchase agreements to earn a higher
rate of return than it could earn simply by investing in the obligation which is
the subject of the repurchase agreement. The Fund will only engage in repurchase
agreements with recognized securities dealers and banks determined to present
minimal credit risk by the Advisor under the direction and supervision of the
Fund's Board of Directors. In addition, the Fund will only engage in repurchase
agreements reasonably designed to secure fully during the term of the agreement
the seller's obligation to repurchase the underlying security and will monitor
the market value of the underlying security during the term of the agreement. If
the seller defaults on its obligation to repurchase and the value of the
underlying security declines, the Fund may incur expenses in selling the
underlying security and may ultimately incur a loss. Repurchase agreements are
always for periods of less than one year, and are considered illiquid if not
terminable within seven days.
The Fund may invest up to 25% of its assets in the securities of foreign
issuers, although it currently holds or intends to hold no more than 5% of its
assets in such securities
The Fund may invest up to 25% of its assets in the securities of foreign
issuers, although it currently holds or intends to hold no more than 5% of its
assets in such securities. The Fund may purchase foreign securities directly or
through U.S. dollar-denominated American Depositary Receipts ("ADRs"), which are
traded in the U.S. on exchanges or over the counter. ADRs are receipts typically
issued by a U.S. bank or trust company which evidence ownership of underlying
securities of a foreign corporation. Foreign securities may involve additional
risks, including currency fluctuations, risks relating to political or economic
conditions, and the potentially less stringent investor protection and
disclosure standards of foreign markets. These factors could make foreign
investments, especially those in developing countries, more volatile. However,
by investing in ADRs rather than directly in foreign issuers' stock, the Fund
can avoid currency and some liquidity risks. The information available for ADRs
is subject to the accounting, auditing and financial reporting standards of the
domestic market or exchange on which they are traded; these standards are more
uniform and more exacting than those to which many foreign issuers may be
subject. See the Statement of Additional Information for more information on
investing in foreign securities.
The Fund may lend its portfolio securities
The Fund may lend its portfolio securities to member firms of the New York Stock
Exchange and commercial banks with assets of one billion dollars or more,
although it does not currently intend to lend more than 5% of its portfolio
securities. The advantage of such loans is that the Fund continues to receive
the equivalent of the interest earned or dividends paid by the issuers on the
loaned securities while at the same time earning interest on the cash or
equivalent collateral which may be invested in accordance with the Fund's
investment objective, policies and restrictions. As with any extension of
credit, there may be risks of delay in recovery and possibly loss of rights in
the loaned securities should the borrower of the loaned securities fail
financially.
High Social Impact Investments
The Fund has adopted a nonfundamental policy that permits it to invest up to
three percent of its assets in investments in securities that offer a rate of
return below the then-prevailing market rate and that present attractive
opportunities for furthering the Fund's social criteria ("High Social Impact
Investments"). In applying this restriction, the percentage of assets in these
securities will be based on the aggregate cumulative value at the time of the
respective acquisitions of those securities currently held by the Fund. These
securities are typically illiquid and unrated and are generally considered
noninvestment-grade debt securities, which involve a greater risk of default or
price decline than investment-grade securities. Through diversification and
credit analysis and limited maturity, investment risk can be reduced, although
there can be no assurance that losses will not occur.
SOCIAL SCREENS
The Fund carefully reviews company policies and behavior regarding social issues
important to quality of life:
Once securities are determined to fall within the investment objective of the
Fund and are deemed financially viable investments, they are screened according
to the social criteria described below. These social screens are applied to
potential investment candidates by the Advisor in consultation with the
Subadvisor.
The following criteria may be changed by the Fund's Board of Directors without
shareholder approval:
- -environment
- -human rights
- -weapons systems
- -nuclear energy
- -employee relations
- -product criteria
(1) The Fund avoids investing in companies that, in the Advisor's opinion, have
significant or historical patterns of violating environmental regulations, or
otherwise have an egregious environmental record. Additionally, the Fund will
avoid investing in nuclear power plant operators and owners, or manufacturers of
key components in the nuclear power process.
(2) The Fund will not invest in companies that are significantly engaged in
weapons production. This includes weapons systems contractors and major nuclear
weapons systems contractors.
(3) The Fund will not invest in companies that, in the Advisor's opinion, have
significant or historical patterns of discrimination against employees on the
basis of race, gender, religion, age, disability or sexual orientation, or that
have major labor-management disputes.
(4) The Fund will not invest in companies that are significantly involved in the
manufacture of tobacco or alcohol products. The Fund will not invest in
companies that make products or offer services that, under proper use, in the
Advisor's opinion, are considered harmful.
The Advisor will seek to review companies' overseas operations consistent with
the social criteria stated above.
While the Fund may invest in companies that exhibit positive social
characteristics, it makes no explicit claims to seek out companies with such
practices.
TOTAL RETURN
The Fund may advertise total return for each class of shares. Total return is
based on historical results and is not intended to indicate future performance.
Total return is calculated separately for each class of shares. It includes not
only the effect of income dividends but also any change in net asset value, or
principal amount, during the stated period. The total return of a class shows
its overall change in value, including changes in share price and assuming all
of the class' dividends and capital gain distributions are reinvested. A
cumulative total return reflects the class' performance over a stated period of
time. An average annual total return reflects the hypothetical annual compounded
return that would have produced the same cumulative total return if the
performance had been constant over the entire period. Because average annual
returns tend to smooth out variations in the returns, you should recognize that
they are not the same as actual year-by-year results. Both types of total return
usually will include the effect of paying the front-end sales charge, in the
case of Class A shares. Of course, total returns will be higher if sales charges
are not taken into account. Quotations of "overall return" do not reflect
deduction of the sales charge. You should consider overall return figures only
if you qualify for a reduced sales charge, or for purposes of comparison with
comparable figures which also do not reflect sales charges, such as mutual fund
averages compiled by Lipper Analytical Services, Inc. Further information about
the Fund's performance is contained in its Annual Report to Shareholders, which
may be obtained without charge by writing or telephoning the Fund at the address
or telephone number listed on the cover of this Prospectus.
MANAGEMENT OF THE FUND
The Fund's Board of Directors supervises the Fund's activities and reviews its
contracts with companies that provide it with services.
The Capital Accumulation Fund is a series of Calvert World Values Fund, Inc. an
open-end management investment company organized as a Maryland corporation on
February 14, 1992. The other series is the Global Equity Fund, a
socially-screened portfolio of equity securities from around the world.
The Fund is not required to hold annual shareholder meetings, but special
meetings may be called for certain purposes such as electing Directors, changing
fundamental policies, or approving a management contract. As a shareholder, you
receive one vote for each share of a Fund you own. For matters affecting only
one Fund, only shares of that Fund are entitled to vote, except that matters
affecting classes differently, such as Distribution Plans, will be voted on
separately by class.
Calvert Asset Management serves as Advisor to the Fund.
Calvert Asset Management Company, Inc. (the "Advisor") is the Fund's investment
advisor. The Advisor provides the Fund with investment supervision and
management; administrative services and office space; furnishes executive and
other personnel to the Fund; and pays the salaries and fees of all Directors who
are affiliated persons of the Advisor. The Advisor may also assume and pay
certain advertising and promotional expenses of the Funds and reserves the right
to compensate broker-dealers in return for their promotional or administrative
services. The Fund pays all other operating expenses as noted in the Statement
of Additional Information.
The Advisor serves as investment advisor to seven other registered investment
companies in the Calvert Group of Funds: First Variable Rate Fund for Government
Income; Calvert Tax-Free Reserves; Calvert Cash Reserves (doing business as
Money Management Plus); Calvert Social Investment Fund; Calvert Municipal Fund,
Inc.; The Calvert Fund; and Acacia Capital Corporation, a registered investment
company whose shares are sold to insurance companies to fund the benefits under
certain variable annuity and variable life insurance policies.
Calvert Group is one of the largest investment management firms in the
Washington, D.C. area.
Calvert Group, Ltd., parent of the Fund's Advisor, transfer agent, and
distributor, is a subsidiary of Acacia Mutual Life Insurance Company of
Washington, D.C. Calvert Group is one of the largest investment management firms
in the Washington, D.C. area. Calvert Group, Ltd. and its subsidiaries are
located at 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. As of
December 31, 1993, Calvert Group managed and administered assets in excess of $4
billion representing more than 200,000 shareholder and depositor accounts.
The Advisor receives a fee based on a percentage of the Fund's assets and the
Fund's performance. From this fee it pays the Subadvisor.
The Investment Advisory Agreement between the Fund and the Advisor provides that
the Advisor is entitled to a base annual fee, payable monthly, of 0.80% of the
Fund's average daily net assets. As of January 1, 1997, the Advisor may earn (or
have its fee reduced by) a performance adjustment based on the extent to which
performance of the Fund exceeds or trails the Standard & Poor's 400 Mid-Cap
Index:
Performance versus the Performance Fee
S&P 400 Mid-Cap Index Adjustment
10% to Less than 25% 0.01%
25% to Less than 40% 0.03%
40% or more 0.05%
The Advisor may in its discretion defer its fees or assume the Fund's operating
expenses. The Investment Advisory Agreement provides that the Advisor may, to
the extent permitted by law, recapture any fees it defers or expenses it assumes
through December 31, 1996. The Advisor has until December 31, 1998 to recapture
fees deferred or expenses reimbursed during the previous two-year period.
The Fund uses a multi-manager approach.
The Fund has a pool of seven investment subadvisors ("Subadvisors") ready to
manage the Fund's assets. The Subadvisors are listed below, the asterisks
indicating those comprising the initial portfolio management team.
Subadvisor Investment Style Ownership
*Apodaca Johnston Small-Cap Growth Hispanic American
*Brown Capital Mid-/Large-Cap Growth African American
*Fortaleza Asset Management Small-Cap Growth Hispanic/Women
Lee Asset Management Small-/Mid-Cap Growth Women
New Amsterdam Mid-Cap Value/Growth Women
Seneca, Inc. Large-Cap Value Women
Sturdivant Large-Cap Value African American
The Advisor has retained a consultant to make recommendations on allocations to
Subadvisors
The Advisor will select which Subadvisors will manage Fund assets at any given
time and the allocation of assets among the managers. The Advisor has retained a
consultant, Progress Investment Management Company, to aid it in making these
determinations. Progress is a California state-certified minority business
enterprise, registered as an investment advisor with the Securities and Exchange
Commission, that evaluates and monitors emerging minority/women-owned investment
management firms.
Apodaca-Johnston Capital Management, Inc.
Apodaca-Johnston Capital Management, Inc. of San Francisco, California is a
small-cap growth manager that seeks to discover compelling investment ideas by
focusing on those entrepreneurial companies that identify and capitalize on
positive trends. It looks for companies that are experiencing a powerful
acceleration in earnings, exhibit a strong, high quality balance sheet or
decidedly improving financial statements and demonstrate strong relative price
strength.
Performance Index: Russell 2000
Portfolio Manager: Scott S. Johnston
Mr. Johnston is President and Chief Investment Officer of Apodaca-Johnston. He
earned a B.A. from the University of California at Berkeley, and an M.B.A. from
the University of Southern California. Mr. Johnston was the Vice President and
Senior Investment Officer of the Trust Investment Department of San Diego Trust
and Savings Bank from 1976 to 1981. He joined Security Pacific Corporation in
1981 where he was the Managing Director and CEO of the Pacific Century Group,
with $2.5 billion in discretionary assets under management. In 1985 Mr. Johnston
founded Sterling Financial Group, an independent SEC-registered investment
advisory firm, which was merged into Apodaca-Johnston Capital Management.
Portfolio Manager: Jerry C. Apodaca, Jr.
Mr. Apodaca is Vice President of Apodaca-Johnston. He earned a B.A. from the
University of New Mexico in 1983, and has had active business experience since
that time.
Brown Capital Management, Inc.
Brown Capital Management, Inc. of Baltimore, Maryland believes that capital can
be enhanced in times of opportunity and preserved in times of adversity without
timing the market. The firm uses a bottom-up approach that incorporates
growth-adjusted price earnings. Stocks purchased are generally undervalued and
have momentum, have EPS growth rates greater than the market, are more
profitable than the market, and have relatively low price-earnings ratios.
Performance Index: Blended: 60% Russell 1000 Growth and 40% Russell 2000
Portfolio Manager: Eddie C. Brown
Mr. Brown is founder and President of Brown Capital Management. He has over 22
years of investment experience, having served as a Vice President and Portfolio
Manager for 10 years at T. Rowe Price Associates immediately prior to starting
his own firm. Mr. Brown holds a B.S. in Electrical Engineering from Howard
University, an M.S. in Electrical Engineering from New York University, and an
M.S. in Business Administration from the Indiana University School of Business.
Additionally, he is a professionally-designated Chartered Financial Analyst
(CFA) and Chartered Investment Counselor (CIC).
Mr. Brown is active in community affairs. He is currently a Commissioner for
Maryland Public Broadcasting (a Gubernatorial appointment), member of the Board
of Directors of the Baltimore Community Foundation (where he chairs the
investment committee for the foundation's $30 million endowment), member of the
Dean's Advisory Council of Indiana University School of Business, and a member
of The President's Roundtable.
Portfolio Manager: Joel Oppenheim
Mr. Oppenheim has had 24 years investment experience for institutions including
the State of Maryland, T. Rowe Price Associates, Inc., the National Rural
Electric Pension and Brown Capital Management. He holds a B.S. in Economics and
Juris Doctor from the University of Wisconsin, and is a Chartered Financial
Analyst (CFA).
Portfolio Manager: Robert E. Hall
Mr. Hall has over 30 years investment experience including 18 years with T. Rowe
Price Associates, Inc., seven years with Emerging Growth Partners, Inc., and
four years with The Investment Center prior to joining Brown Capital Management.
Mr. Hall is a former Trustee of the Peabody Institute of Johns Hopkins
University.
Fortaleza Asset Management, Inc.
Fortaleza Asset Management, Inc., of Chicago, Illinois, is a small-cap growth
manager that bases its investment principles on three key elements: (1) a
proprietary stock valuation system that incorporates technical and market
sentiment indicators to determine optimal buy points; (2) an emphasis on the
preservation of capital through the implementation of a strict selling
discipline to lock in capital gains and reduce losses; and (3) a discipline that
does not force equity commitment in overvalued markets. The investment approach
is based on a bottom-up stock selection process.
Performance Index: Russell 2000
Portfolio Manager: Margarita Perez
Ms. Perez is the founder, President and Portfolio Manager of Fortaleza, and has
over 13 years of investment experience. Prior to forming Fortaleza, Ms. Perez
was Vice President and Portfolio Manager for Monetta Financial Services, Inc.,
where she was directly involved in the management of equity accounts totalling
in excess of $100 million.
Ms. Perez is a native of Puerto Rico and has lived in the Chicago area since the
late 1960s. She earned an MBA from DePaul University School of Commerce. Ms.
Perez is a member of various professional organizations including the American
Institute of CPAs, National Society of Hispanic MBAs, Association for Investment
Management and Research (AIMR), and the National Association of Securities
Professionals (NASP). She is also a trustee of the Chicago Historical Society.
Portfolio Manager: James Boves
Mr. Boves brings over 25 year of investment management and research experience
to Fortaleza. He has a master's degree in Economics from Northern Illinois
University and is a member of the Investment Analysts Society in Chicago.
Subadvisory compensation
The Investment Subadvisory Agreement between the Advisor and each of the
Subadvisors provides that the Subadvisors currently managing Fund assets are
entitled to a base Subadvisory fee of 0.25% of that portion of the Fund's
average daily net assets managed by the Subadvisor, paid by the Advisor.out of
the fee the Advisor receives from the Fund. As of January 1, 1997, each
Subadvisor may earn (or have its base fee reduced by) a performance adjustment
based on the extent to which performance of the Fund exceeds or trails the index
agreed on with the Advisor as matching its investment style (indicated under the
description of each Subadvisor):
Performance versus Performance Fee
the Index Adjustment
10% to Less than 25% 0.02%
25% to Less than 40% 0.05%
40% or more 0.10%
Payment by the Fund of a performance adjustment will be conditioned on: (1) the
performance of the Fund as a whole having exceeded the S&P 400 Mid-Cap Index;
and (2) payment of the performance adjustment not causing the Fund's performance
to fall below the S&P 400 Mid-Cap Index. The performance adjustment will be paid
by the Fund to the Advisor, which will then pass it on to the Subadvisor.
Calvert Administrative Services Company provides administrative services for the
Fund.
Calvert Administrative Services Company ("CASC"), an affiliate of the Advisor,
has been retained by the Fund to provide certain administrative services
necessary to the conduct of its affairs, including the preparation of regulatory
filings and shareholder reports, the daily determination of its net asset value
per share and dividends, and the maintenance of its portfolio and general
accounting records. For providing such services, CASC receives an annual fee,
payable monthly, from the Fund of 0.10% of the Fund's average daily net assets.
Calvert Securities Corporation serves as underwriter to market the Fund's
shares.
Calvert Securities Corporation ("CSC") is the Fund's principal underwriter and
distributor. Under the terms of its underwriting agreement with the Fund, CSC
markets and distributes the Fund's shares and is responsible for payment of
commissions and service fees to broker-dealers, banks, and financial services
firms, preparation of advertising and sales literature, and printing and mailing
of prospectuses to prospective investors.
The transfer agent keeps your account records.
Calvert Shareholder Services, Inc. is the Fund's transfer, dividend disbursing
and shareholder servicing agent
SHAREHOLDER GUIDE
Opening An Account
You can buy shares of the Fund in several ways.
An account application accompanies this prospectus. A completed and signed
application is required for each new account you open, regardless of the method
you choose for making your initial investment. Additional forms may be required
from corporations, associations, and certain fiduciaries. If you have any
questions or need extra applications, call your broker, or Calvert Group at
800-368-2748. Be sure to specify which class you wish to purchase.
To invest in any of Calvert's tax-deferred retirement plans, please call Calvert
Group at 800-368-2748 to receive information and the required separate
application.
Alternative Sales Options
The Fund offers three classes of shares:
Class A Shares - Front End Load Option
Class A shares are sold with a front-end sales charge at the time of purchase.
Class A shares are not subject to a sales charge when they are redeemed.
Class C shares - Level Load Option
Class C shares are sold without a sales charge at the time of purchase or
redemption.
Class C shares have higher expenses than Class A shares
The Fund bears some of the costs of selling its shares under Distribution Plans
adopted with respect to its Class A and Class C shares pursuant to Rule 12b-1
under the 1940 Act. Payments under the Class A Distribution Plan are limited to
up to 0.35% annually of the average daily net asset value of Class A shares. The
Class C Distribution Plan provides for the payment of an annual distribution fee
to CSC of up to 0.75%, plus a service fee of up to 0.25%, for a total of 1.00%
of the average daily net assets.
Considerations for deciding which class of shares to buy
Income distributions paid by the Fund with respect to Class B and Class C shares
will generally be less than those paid with respect to Class A shares. You
should consider Class A shares if you qualify for a reduced sales charge under
Class A. Class A shares may also be more appropriate for larger accounts or if
you plan to hold the shares for several years. Class C shares are not available
for investments of $1 million or more.
Class A Shares
Class A shares are offered at net asset value plus a front-end sales charge as
follows:
<TABLE>
<CAPTION>
Concession to
As a % of Dealers as a %
As a % of Net Amount of Amount
Amount of Investment Offering Price Invested Invested
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000 4.75% 4.99% 4.00%
$50,000 but less than $100,000 3.75% 3.90% 3.00%
$100,000 but less than $250,000 2.75% 2.83% 2.25%
$250,000 but less than $500,000 1.75% 1.78% 1.25%
$500,000 but less than $1,000,000 1.00% 1.01% 0.80%
$1,000,000 and over 0.00% 0.00% 0.25%*
*For new investments (new purchases but not exchanges) of $1 million or more, a
broker-dealer will have the choice of being paid a finder's fee by CSC according
to one of the following methods: (1) CSC may pay broker-dealers, on a monthly
basis for 12 months, an annual rate of 0.30%. Payments will be made monthly at
the rate of 0.025% of the amount of the investment, less redemptions; (2) CSC
may pay broker-dealers 0.25% of the amount of the purchase; however, CSC
reserves the right to recoup any portion of the amount paid to the broker-dealer
if the investor redeems some or all of the shares from the Fund within thirteen
months of the time of purchase.
</TABLE>
Sales charges on Class A shares may be reduced or eliminated in certain cases.
See Exhibit A to this prospectus.
The sales charge is paid to CSC, which in turn normally reallows a portion to
your broker-dealer. Upon written notice to dealers with whom it has dealer
agreements, CSC may reallow up to the full applicable sales charge. Dealers to
whom substantially the entire sales charge is reallowed may be deemed to be
underwriters under the Securities Act of 1933.
In addition to any sales charge reallowance or finder's fee, your broker-dealer,
or other financial service firm through which your account is held, currently
will be paid periodic service fees at an annual rate of up to 0.25% of the
average daily net asset value of Class A shares held in accounts maintained by
that firm.
Class A Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class A shares (the
"Class A Distribution Plan"), which provides for payments at a maximum rate of
0.35% of the average daily net asset value of Class A shares, to pay expenses
associated with the distribution and servicing of Class A shares. Amounts paid
by the Fund to CSC under the Class A Distribution Plan are used to pay to
broker-dealers and others, including CSC salespersons who service accounts,
service fees at an annual rate of up to 0.35% of the average daily net asset
value of Class A shares, and to pay CSC for its marketing and distribution
expenses, including, but not limited to, preparation of advertising and sales
literature and the printing and mailing of prospectuses to prospective
investors.
Class C Shares
Class C shares are not available through all dealers. Class C shares are offered
at net asset value, without a front-end sales charge or a contingent deferred
sales charge. Class C expenses are higher than those of Class A.
Class C Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class C shares (the
"Class C Distribution Plan"), which provides for payments at an annual rate of
up to 1.00% of the average daily net asset value of Class C shares, to pay
expenses of the distribution and servicing of Class C shares. Amounts paid by
the Fund under the Class C Distribution Plan are currently used by CSC to pay
broker-dealers and other selling firms dealer-paid quarterly compensation at an
annual rate of up to 0.75%, plus a service fee of up to 0.25%, of the average
daily net asset value of each share sold by such others.
Arrangements with Broker-Dealers and Others
CSC may also pay additional concessions, including non-cash promotional
incentives, such as merchandise or trips, to dealers employing registered
representatives who have sold or are expected to sell a minimum dollar amount of
shares of the Fund and/or shares of other Funds underwritten by CSC. CSC may
make expense reimbursements for special training of a dealer's registered
representatives, advertising or equipment, or to defray the expenses of sales
contests. CSC may receive reimbursement of eligible marketing and distribution
expenses from the Fund's Rule 12b-1 Distribution Plan.
Dealers or others may receive different levels of compensation depending on
which class of shares they sell. Payments pursuant to a Distribution Plan are
included in the operating expenses of the class.
HOW TO BUY SHARES
(BE SURE TO SPECIFY WHICH CLASS YOU ARE BUYING)
Method New Accounts Additional Investments
By Mail $2,000 minimum $250 minimum
Please make your check payable Please make your check payable
to the Fund and mail it with to the Fund and mail it with
your application to: your investment slip to:
Calvert Group Calvert Group
4550 Montgomery Avenue P.O. Box 64146
Suite 1000N Baltimore, Maryland
Bethesda, Maryland 20814 21264-4146
West Coast Investors use:
Calvert Group
P.O. Box 883610
San Francisco, CA
94188-3610
By Registered, Certified, or Overnight Mail:
Calvert Group
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Through Your Broker $2,000 minimum $250 minimum
At the Calvert Visit the Calvert Branch Office to make investments by
Branch Office check. See back cover page for the address.
FOR ALL OPTIONS BELOW, PLEASE CALL YOUR BROKER, OR CALVERT GROUP AT 800-368-2745
By Exchange $2,000 minimum $250 minimum
(From your account in another Calvert Group Fund)
When opening an account by exchange, your new account must be established with
the same name(s), address and taxpayer identification number as your existing
Calvert account.
By Bank Wire $2,000 minimum $250 minimum
By Calvert Money Not Available for $50 minimum
Controller* Initial Investment
*Please allow sufficient time for Calvert Group to process your initial request
for this service, normally 10 business days. The maximum transaction amount is
$300,000, and your purchase request must be received by 4:00 p.m. Eastern time.
NET ASSET VALUE
Net asset value per share ("NAV") refers to the worth of one share. NAV is
computed by adding the value of all portfolio holdings, plus other assets,
deducting liabilities and then dividing the result by the number of shares
outstanding. The NAV of each class will vary daily based on the market values of
the Fund's investments.
Portfolio securities and other assets are valued based on market quotations,
except that securities maturing within 60 days are valued at amortized cost. If
quotations are not available, securities are valued by a method that the Board
of Directors believes accurately reflects fair value.
The NAV is calculated at the close of the Fund's business day, which coincides
with the closing of the regular session of the New York Stock Exchange (normally
4:00 p.m. Eastern time). The Fund is open for business each day the New York
Stock Exchange is open. All purchases of Fund shares will be confirmed and
credited to your account in full and fractional shares (rounded to the nearest
1/1000 of a share). You may buy or sell shares of the Fund through a broker.
WHEN YOUR ACCOUNT WILL BE CREDITED
Before you buy shares, please read the following information to make sure your
investment is accepted and credited properly.
Your purchase will be processed at the next offering price based on the next net
asset value calculated after your order is received and accepted. If your
purchase is received by 4:00 p.m. Eastern time, your account will be credited on
the day of receipt. If your purchase is received after 4:00 p.m. Eastern time,
it will be credited the next business day. All your purchases must be made in
U.S. dollars and checks must be drawn on U.S. banks. No cash will be accepted.
The Fund reserves the right to suspend the offering of shares for a period of
time or to reject any specific purchase order. If your check does not clear,
your purchase will be canceled and you will be charged a $10 fee plus costs
incurred by the Fund. When you purchase by check or with Calvert Money
Controller, those funds will be on hold for up to 10 business days from the date
of receipt. During that time, redemptions against those funds will not be
honored. To avoid this collection period, you can wire federal funds from your
bank, which may charge you a fee.
Certain financial institutions or broker-dealers which have entered into a sales
agreement with CSC may enter confirmed purchase orders on behalf of customers by
phone, with payment to follow within a number of days of the order as specified
by the program. If payment is not received in the time specified, the financial
institution could be held liable for resulting fees or losses.
EXCHANGES
You may exchange shares of the Fund for shares of the same class of other
Calvert Group Funds.
If your investment goals change, the Calvert Group Family of Funds has a variety
of investment objectives that includes common stock funds, tax-exempt and
corporate bond funds, and money market funds. The exchange privilege is a
convenient way to buy shares in other Calvert Group Funds in order to respond to
changes in your goals or in market conditions. However, to protect a Fund's
performance and to minimize costs, Calvert Group discourages frequent exchanges
and may prohibit additional purchases of Fund shares by persons engaged in too
many short-term trades. Before you make an exchange from a Fund or Portfolio,
please note the following:
Call your broker or a Calvert representative for information and a prospectus
for any of Calvert's other Funds registered in your state. Read the prospectus
of the Fund or Portfolio into which you want to exchange for relevant
information, including class offerings.
Shares of a particular class of the Fund may be exchanged only for shares of the
same class of another Calvert variable NAV Fund. Any class of any Calvert Fund
may be exchanged for shares of any Calvert money market fund.
Each exchange represents the sale of shares of one Fund and the purchase of
shares of another. Therefore, you could realize a taxable gain or loss on the
transaction.
Complete and sign an application for an account in that Fund or Portfolio,
taking care to register your new account in the same name and taxpayer
identification number as your existing Calvert account(s). Exchange instructions
may then be given by telephone if telephone redemptions have been authorized and
the shares are not in certificate form.
Shares on which you have already paid a sales charge at Calvert Group and shares
acquired by reinvestment of dividends or distributions may be exchanged into
another Fund at no additional charge.
Shareholders (and those managing multiple accounts) who make two purchases and
two exchange redemptions of shares of the same Portfolio during any 6-month
period will be given written notice that they may be prohibited from making
additional investments. This policy does not prohibit a shareholder from
redeeming shares of the Fund, and does not apply to trades solely among money
market funds.
The Fund reserves the right to terminate or modify the exchange privilege with
60 days written notice.
OTHER CALVERT GROUP SERVICES
Calvert Information Network
24 hour total return quotations and prices
Calvert Group has a round-the-clock telephone service that lets existing
customers use a push button phone to obtain prices, performance information and
account balances. Complete instructions for this service may be found on the
back of each statement.
Calvert Money Controller
Calvert Money Controller eliminates the delay of mailing a check or the expense
of wiring funds. You can request this free service on your application.
This service allows you to authorize electronic transfers of money to purchase
or sell shares. You use Calvert Money Controller like an "electronic check" to
move money ($50 to $300,000 ) between your bank account and your Calvert Group
account with one phone call. Allow one or two business days after the call for
the transfer to take place; for money recently invested, allow normal check
clearing time (up to 10 business days) before redemption proceeds are sent to
your bank.
You may also arrange systematic monthly or quarterly investments (minimum $50)
into your Calvert Group account. After you give us proper authorization, your
bank account will be debited to purchase Fund shares. A debit entry will appear
on your bank statement. Share purchases made through Calvert Money Controller
will be subject to the applicable sales charge. If you would like to make
arrangements for systematic monthly or quarterly redemptions from your Calvert
Group account, call your broker or Calvert Group for a Money Controller
Application.
Telephone Transactions
Calvert may record all telephone calls.
If you have telephone transaction privileges, you may purchase, redeem, or
exchange shares, wire funds and use Calvert Money Controller by telephone. You
automatically have telephone privileges unless you elect otherwise. The Fund,
the transfer agent and their affiliates are not liable for acting in good faith
on telephone instructions relating to your account, so long as they follow
reasonable procedures to determine that the telephone instructions are genuine.
Such procedures may include recording the telephone calls and requiring some
form of personal identification. You should verify the accuracy of telephone
transactions immediately upon receipt of your confirmation statement.
Optional Services
Complete the "Option" sections of the application for the easiest way to
establish services.
The easiest way to establish optional services on your Calvert Group account is
to select the options you desire when you complete your account application. If
you wish to add other options later, you may have to provide us with additional
information and a signature guarantee. Please call Calvert Investor Relations at
800-368-2745 for further assistance. For our mutual protection, we may require a
signature guarantee on certain written transaction requests. A signature
guarantee verifies the authenticity of your signature, and may be obtained from
any bank, trust company, savings and loan association, credit union,
broker-dealer firm or member of a domestic stock exchange. A signature guarantee
cannot be provided by a notary public.
Householding of General Mailings
You can help in an effort to reduce Fund expenses and save paper and trees for
the environment.
If you have multiple accounts with Calvert, you may soon receive combined
mailings of some shareholder information, such as semi-annual and annual
reports. Please contact Calvert Investor Relations at 800-368-2745 to receive
additional copies of information.
Special Services and Charges
The Fund pays for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account. You may be required to pay a research fee for these special
services.
If you are purchasing shares of the Fund through a program of services offered
by a broker, dealer or financial institution, you should read the program
materials in conjunction with this Prospectus. Certain features may be modified
in these programs, and administrative charges may be imposed by the
broker-dealer or financial institution for the services rendered.
Tax-Saving Retirement Plans
Contact Calvert Group for complete information kits discussing the plans, and
their benefits, provisions and fees.
Calvert Group can set up your new account in the Fund under one of several
tax-deferred plans. These plans let you invest for retirement and shelter your
investment income from current taxes. Minimums may differ from those listed in
the chart on page _____. Also, reduced sales charges may apply. See "Exhibit A"
- - Reduced Sales Charges."
Individual retirement accounts (IRAs): available to anyone who has earned
income. You may also be able to make investments in the name of your spouse, if
your spouse has no earned income.
Qualified Profit-Sharing and Money-Purchase Plans (including 401(k) Plans):
available to self-employed people and their partners, or to corporations and
their employees.
Simplified Employee Pension Plan (SEP-IRA): available to self-employed people
and their partners, or to corporations. Salary reduction pension plans (SAR-SEP
IRAs) are also available to employers with 25 or fewer employees.
403(b)(7) Custodial Accounts: available to employees of most non-profit
organizations and public schools and universities.
HOW TO SELL YOUR SHARES
You may redeem all or a portion of your shares on any business day. Your shares
will be redeemed at the next net asset value calculated after your redemption
request is received and accepted. See below for specific requirements necessary
to make sure your redemption request is acceptable. Remember that the Fund may
hold payment on the redemption of your shares until it is reasonably satisfied
that investments made by check or by Calvert Money Controller have been
collected (normally up to 10 business days). The Fund reserves the right to
redeem in kind (i.e., to give you the value of your redemption in portfolio
securities instead of in cash).
Redemption Requirements To Remember
To ensure acceptance of your redemption request, please follow the procedures
described here and below.
Once your shares are redeemed, the proceeds will normally be sent to you on the
next business day, but if making immediate payment could adversely affect the
Fund, it may take up to seven (7) days. Calvert Money Controller redemptions
generally will be credited to your bank account on the first or second business
day after your phone call. When the New York Stock Exchange is closed (or when
trading is restricted) for any reason other than its customary weekend or
holiday closings, or under any emergency circumstances as determined by the
Securities and Exchange Commission, redemptions may be suspended or payment
dates postponed.
Minimum account balance is $1,000 per Fund, per class.
Please maintain a balance in your account of at least $1,000 per Fund, per
class. If, due to redemptions, the account falls below $1,000, or you fail to
invest at least $1,000, it may be closed and the proceeds mailed to you at the
address of record. You will have 30 days' notice that your account will be
closed unless you make an additional investment to increase your account balance
to the $1,000 minimum per Fund.
By Mail To:
Calvert Group
4550 Montgomery Ave.
Bethesda, MD 20814
You may redeem available shares from your account at any time by sending a
letter of instruction, including your name, account and Fund number, the number
of shares or dollar amount, and where you want the money to be sent. Additional
requirements, below, may apply to your account. The letter of instruction must
be signed by all required authorized signers. If you want the money to be wired
to a bank not previously authorized, then a voided bank check must be enclosed
with your letter. If you do not have a voided check or if you would like funds
sent to a different address or another person, your letter must be signature
guaranteed.
Type of Registration Requirements
Corporations, Associations Letter of instruction and a corporate resolution,
signed by person(s) authorized to act on the
account, accompanied by signature guarantee(s).
Trusts Letter of instruction signed by the Trustee(s)
(as Trustee), with a signature guarantee.
(If the Trustee's name is not registered on your
account, provide acopy of the trust document,
certified within the last 60 days.)
By Telephone
Please call 800-368-2745. You may redeem shares from your account by telephone
and have your money mailed to your address of record or wired to an address or
bank you have previously authorized. A charge of $5 is imposed on wire transfers
of less than $1,000. See "Telephone Transactions" on page ___. If for any reason
you are unable to reach the Fund by telephone, whether due to mechanical
difficulties, heavy market volume or otherwise, you may send a written
redemption request to the Fund by overnight mail. If your account is held
through a broker, see "Through Your Broker" below.
Calvert Money Controller
Please allow sufficient time for Calvert Group to process your initial request
for this service (normally 10 business days). You may also authorize automatic
fixed amount redemptions by Calvert Money Controller. All requests must be
received by 4:00 p.m. Eastern time. Accounts cannot be closed by this service.
Exchange to Another Calvert Group Fund
You must meet the minimum investment requirement of the other Calvert Group Fund
or Portfolio. You can only exchange between accounts with identical names,
addresses and taxpayer identification number, unless previously authorized with
a signature-guaranteed letter. See "Exchanges."
Systematic Check Redemptions
If you maintain an account with a balance of $10,000 or more, you may have
regular monthly or quarterly redemption checks for $100 or more sent to you or
another recipient. This service must be authorized in advance with a
signature-guaranteed letter.
Through your Broker
If your account is held in your broker's name ("street name"), you should
contact your broker directly to transfer, exchange or redeem shares.
DIVIDENDS AND TAXES
Each year, the Fund distributes substantially all of its net investment income
and capital gains to shareholders.
Dividends from the Fund's net investment income are declared and paid annually.
Net investment income consists of the interest income, net short-term capital
gains, if any, and dividends declared and paid on investments, less expenses.
Distributions of the Fund's net short-term capital gains (treated as dividends
for tax purposes) and its net long-term capital gains, if any, are normally
declared and paid by the Fund once a year; however, the Fund does not anticipate
making any such distributions unless available capital loss carryovers have been
used or have expired. Dividend and distribution payments will vary between
classes; dividend payments will generally be higher for Class A shares.
Dividend and Distribution Payment Options
Dividends and any distributions are automatically reinvested in the same Fund at
net asset value (no sales charge), unless you elect to have the dividends of $10
or more paid in cash (by check or by Calvert Money Controller). Dividends and
distributions may be automatically invested in an identically registered account
with the same account number in any other Calvert Group Fund at net asset value.
If reinvested in the same Fund account, new shares will be purchased at net
asset value on the reinvestment date, which is generally 1 to 3 days prior to
the payment date. You must notify the Fund in writing prior to the record date
to change your payment options. If you elect to have dividends and/or
distributions paid in cash, and the U.S. Postal Service cannot deliver the
check, or if it remains uncashed for six months, it, as well as future dividends
and distributions, will be reinvested in additional shares.
"Buying a Dividend"
At the time of purchase, the share price of the Fund may reflect undistributed
income, capital gains or unrealized appreciation of securities. Any income or
capital gains from these amounts which are later distributed to you are fully
taxable. On the record date for a distribution, the Fund's share value is
reduced by the amount of the distribution. If you buy shares just before the
record date ("buying a dividend") you will pay the full price for the shares and
then receive a portion of the price back as a taxable distribution.
Federal Taxes
The Fund normally distributes all net income and capital gain to shareholders.
These distributions are taxable to you regardless of whether they are taken in
cash or reinvested. Distributions of net investment income are taxable as
ordinary income; distributions of long-term capital gains are taxable as
long-term capital gains regardless of how long you have held the shares.
Dividends and distributions declared during October, November or December and
paid in January of the following year are taxable in the year they are declared.
The Fund will mail you Form 1099-DIV in January indicating the federal tax
status of your dividends. If distributions exceed the Fund's net investment
income and capital gain for the year, the excess will reduce your tax basis for
your shares in the Fund.
You may realize a capital gain or loss when you sell or exchange shares.
If you sell or exchange your Fund shares you will have a short or long-term
capital gain or loss, depending on how long you owned the shares which were
sold. In January, the Fund will mail you Form 1099-B indicating the proceeds
from all sales, including exchanges. You should keep your annual year-end
account statements to determine the cost (basis) of the shares to report on your
tax returns.
Taxpayer Identification Number
If we do not have your correct Social Security or Corporate Tax Identification
Number ("TIN") and a signed certified application or Form W-9, Federal law
requires the Fund to withhold 31% of your dividends and certain redemptions. In
addition, you may be subject to a fine. You will also be prohibited from opening
another account by exchange. If this TIN information is not received within 60
days after your account is established, your account may be redeemed at the
current NAV on the date of redemption. The Fund reserves the right to reject any
new account or any purchase order for failure to supply a certified TIN.
EXHIBIT A REDUCED SALES CHARGES (CLASS A ONLY)
You may qualify for a reduced sales charge through several purchase plans
available. You must notify the Fund at the time of purchase to take advantage of
the reduced sales charge.
Right of Accumulation. The sales charge is calculated by taking into account not
only the dollar amount of a new purchase of shares, but also the higher of cost
or current value of shares previously purchased in Calvert Group Funds that
impose sales charges. This automatically applies to your account for each new
purchase.
Letter of Intent. If you plan to purchase $50,000 or more of Fund shares over
the next 13 months, your sales charge may be reduced through a "Letter of
Intent." You pay the lower sales charge applicable to the total amount you plan
to invest over the 13-month period, excluding any money market fund purchases.
Part of your shares will be held in escrow, so that if you do not invest the
amount indicated, you will have to pay the sales charge applicable to the
smaller investment actually made. For more information, see the Statement of
Additional Information.
Group Purchases. If you are a member of a qualified group, you may purchase
shares of the Fund at the reduced sales charge applicable to the group taken as
a whole. The sales charge is calculated by taking into account not only the
dollar amount of the shares you purchase, but also the higher of cost or current
value of shares previously purchased and currently held by other members of your
group.
A "qualified group" is one which (i) has been in existence for more than six
months, (ii) has a purpose other than acquiring Fund shares at a discount, and
(iii) satisfies uniform criteria which enable CSC and dealers offering Fund
shares to realize economies of scale in distributing such shares. A qualified
group must have more than 10 members, must be available to arrange for group
meetings between representatives of CSC or dealers distributing the Fund's
shares, must agree to include sales and other materials related to the Fund in
its publications and mailings to members at reduced or no cost to CSC or
dealers, and must seek to arrange for payroll deduction or other bulk
transmission of investments to the Fund.
Pension plans may not qualify participants for group purchases; however, such
plans may qualify for reduced sales charges under a separate provision (see
below). Members of a group are not eligible for a Letter of Intent.
Retirement Plans Under Section 457, Section 403(b)(7), or Section 401(k). There
is no sales charge on shares purchased for the benefit of a retirement plan
under Section 457 of the Internal Revenue Code of 1986, as amended ("Code"), or
for a plan qualifying under Seciton 403(b)(7) of the Code if, at the time of
purchase, Calvert Group has been notified in writing that the 403(b)(7) plan has
at least 200 eligible employees. Furthermore, there is no sales charge on shares
purchased for the benefit of a retirement plan qualifying under Section 401(k)
of the Code if, at the time of such purchase, the 401(k) plan administrator has
notified Calvert Group in writing that a) its 401(k) plan has at least 200
eligible employees; or b) the cost or current value of shares the plan has in
Calvert Group of Funds (except money market funds) is at least $1 million.
Neither the Fund, nor CSC, nor any affiliate thereof will reimburse a plan or
participant for any sales charges paid prior to receipt of such written
communication and confirmation by Calvert Group. Plan administrators should send
requests for the waiver of sales charges based on the above conditions to:
Calvert Group Retirement Plans, 4550 Montgomery Avenue, Suite 1000N, Bethesda,
Maryland 20814.
Other Circumstances. There is no sales charge on shares of any fund (portfolio
or series) of the Calvert Group of Funds sold to:
(1) current and retired members of the Board of Trustees/Directors of the
Calvert Group of Funds, (and the Advisory Council of the Calvert Social
Investment Fund);
(2) directors, officers and employees of the Advisor, Distributor, and
their affiliated companies;
(3) directors, officers and registered representatives of brokers
distributing the Fund's shares; and immediate family members of persons
listed in (1), (2), or (3) above;
(4) dealers, brokers, or registered investment advisors that have entered
into an agreement with CSC providing specifically for the use of shares of
the Fund (Portfolio or Series) in particular investment programs or
products (where such program or product already has a fee charged therein)
made available to the clients of such dealer, broker, or registered
investment advisor;
(5) trust departments of banks or savings institutions for trust clients of
such bank or savings institution; and
(6)purchases placed through a broker maintaining an omnibus account with
the Fund (Portfolio or Series) and the purchases are made by (a) investment
advisors or financial planners placing trades for their own accounts or the
accounts of their clients and who charge a management, consulting, or other
fee for their services; or (b) clients of such investment advisors or
financial planners who place trades for their own accounts if the accounts
are linked to the master account of such investment advisor or financial
planner on the books and records of the broker or agent; or (c) retirement
and deferred compensation plans and trusts used to fund those plans,
including, but not limited to, those defined in Section 401(a) or Section
403(b) of the I.R.C., and "rabbi trusts."
Dividends and Capital Gain Distributions from other Calvert Group Funds.
You may prearrange to have your dividends and capital gain distributions
from another Calvert Group Fund with a sales charge automatically invested
in another account with no additional sales charge. Dividends and
distributions from Calvert Group money market funds used to purchase shares
of the Fund will be subject to the applicable sales charge.
Reinstatement Privilege. If you redeem Fund shares and then within 30 days
decide to reinvest in the same Fund, you may do so at the net asset value
next computed after the reinvestment order is received, without a sales
charge. You may use the reinstatement privilege only once. The Fund
reserves the right to modify or eliminate this privilege.
Certain Sales at Net Asset Value Through December 31, 1994
Redemptions from Other Mutual Funds. You may purchase shares of the Fund at
net asset value, without sales charge, to the extent that the purchase
represents proceeds from a redemption, within the preceding 60 days, of shares
of another mutual fund. When making a purchase at net asset value under this
provision, the Fund must receive one of the following with your direct purchase
order: (i) the redemption check representing the proceeds of the shares
redeemed, endorsed to the order of the Fund, or (ii) a copy of the confirmation
from the other fund, showing the redemption transaction. Standard back office
procedures should be followed for wire order purchases. Purchases with
redemptions from money market funds are not eligible for this privilege. This
provision is effective through December 31, 1994 only, but may be extended at
the discretion of the Distributor.
===============================================================================
To Open an Account: Prospectus
800-368-2748 October 31, 1994
Performance and Prices:
Calvert Information Network CALVERT WORLD VALUES
24 hours, 7 days a week CAPITAL ACCUMULATION FUND
800-368-2745
Service for Existing Account:
Shareholders 800-368-2745
Brokers 800-368-2746
TDD for Hearing-Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail:
Calvert Group
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
PRINCIPAL UNDERWRITER
Calvert Securities Corporation
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
===============================================================================
Table of Contents
Fund Expenses
Investment Objective and Policies
Investment Techniques and Risks
Social Screens
Total Return
Management of the Fund
SHAREHOLDER GUIDE:
How to Buy Shares
Net Asset Value
When Your Account Will Be Credited
Exchanges
Other Calvert Group Services
How to Sell Your Shares
Dividends and Taxes
Exhibit A (Reduced Sales Charges)
