As filed with the Securities and Exchange Commission on February 25, 1999
Securities Act Registration No. 2-34038
Investment Company Act Registration No. 811-1861
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]
Pre-Effective Amendment No. ______ [ ]
Post-Effective Amendment No. 37 [ X ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]
Amendment No. 37
SENTRY FUND, INC.
(Exact Name of Registrant as Specified in Charter)
1800 North Point Drive, Stevens Point, Wisconsin 54481
(Address of Principal Executive Offices and Zip Code)
Telephone (715) 346-6000
(Registrant's Telephone Number, Including Area Code)
Susan M. DeBruin
Sentry Fund, Inc.
1800 North Point Drive
Stevens Point, Wisconsin 54481
(Name and Address of Agent for Service)
Copies to:
Scott A. Moehrke
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, WI 53202
It is proposed that this filing will become effective
(check appropriate box)
[ ] immediately upon filing pursuant to Rule 485(b)
[X] on March 1, 1999, pursuant to Rule 485(b)
[ ] 60 days after filing pursuant to Rule 485(a)(1)
[ ] on (date) pursuant to Rule 485(a)(1)
[ ] 75 days after filing pursuant to Rule 485(a)(2)
[ ] on (date) pursuant to Rule 485(a)(2)
If appropriate, check the following box:
[ ] this post-effective amendment designates a
new effective date for a previously-filed post-
effective amendment.
<PAGE>
SENTRY FUND, INC.
1800 North Point Drive
Stevens Point, WI 54481
Telephone: (800) 533-7827
PROSPECTUS
March 1, 1999
The investment objective of Sentry Fund, Inc. (the
"Fund") is long-term capital growth. The Fund invests
in common stocks and other securities that have the
principal characteristics of common stocks or are
convertible into common stocks.
This Prospectus contains information you should know
before you invest in the Fund. Please read it
carefully and keep it for future reference.
The Securities and Exchange Commission (the "SEC") has
not approved or disapproved of these securities or
passed upon the adequacy of this Prospectus. Any
representation to the contrary is a criminal offense.
<PAGE>
TABLE OF CONTENTS
HIGHLIGHTS AND RISKS 2
PAST PERFORMANCE 3
FEES AND EXPENSES OF THE FUND 4
INVESTMENT OBJECTIVE 5
HOW THE FUND INVESTS 5
FUND MANAGEMENT 6
HOW TO PURCHASE SHARES 7
SPECIAL SERVICES FOR SHAREHOLDERS 9
HOW TO REDEEM SHARES 10
VALUATION OF FUND SHARES 12
DISTRIBUTIONS TO SHAREHOLDERS AND TAXATION 12
YEAR 2000 ISSUE 13
FINANCIAL HIGHLIGHTS 14
In deciding whether to invest in the Fund, you should
rely only on information in this Prospectus or the
Statement of Additional Information (the "SAI"). The
Fund has not authorized others to provide additional
information. The Fund does not authorize use of this
Prospectus in any state or jurisdiction in which an
offer to sell shares of the Fund may not lawfully be
made.
<PAGE>
HIGHLIGHTS AND RISKS
What are the goals of the Fund?
The Fund's goal is long-term capital growth. This goal
is sometimes referred to as the Fund's investment
objective. Current income from dividends or interest
is not an important factor in selecting investments for
the Fund. The Fund cannot guarantee that it will
achieve its goal. For more information, see "How the
Fund Invests."
What will the Fund invest in?
The Fund invests primarily in common stocks of
established domestic companies. In trying to achieve
its goal, the common stocks selected for the Fund will
be those the Fund's investment adviser, Sentry
Investment Management, Inc. (the "Adviser"), believes
offer favorable long-term growth prospects. For more
information, see "How the Fund Invests."
What are the principal risks of investing in the Fund?
The main risks of investing in the Fund are:
Stock Market Risk: Equity funds like the Fund
are subject to stock market risks and significant
fluctuations in value. If the stock market declines
in value, the Fund is likely to decline in value.
Increases or decreases in value of stocks are generally
greater than for bonds or other debt instruments.
Stock Selection Risk: The stocks selected by the
Adviser may decline in value or not increase in
value when the stock market in general is rising.
Liquidity Risk: The Adviser may not be able to sell
stocks at an optimal time or price.
You should be aware that you may lose money by
investing in the Fund.
Is an investment in the Fund appropriate for me?
The Fund is suitable for long-term investors only. The
Fund is not a short-term investment vehicle. An
investment in the Fund may be appropriate if:
Your goal is long-term capital growth;
You do not require current income from this
investment; and
You are willing to accept short-term or
intermediate-term fluctuations in value to seek
possible higher long-term returns.
<PAGE>
PAST PERFORMANCE
The bar chart and table below provide some indication
of the risks of investing in the Fund by showing how
the Fund's performance has varied from year to year and
by showing how the Fund's performance over time
compares to that of the S&P 500 Index1r. The bar
chart and table assume reinvestment of income dividends
and capital gain distributions. When first organized
in 1970, the Fund applied a sales charge to each share
purchase. The Fund's sales charge was eliminated on
March 1, 1991. The performance data shown does not
reflect its deduction, and had it been reflected, the
charge would reduce the performance shown. Remember
that the Fund's past performance does not reflect how
the Fund may perform in the future.
Year-by-year total return as of 12/31 of each year
24.04% 5.23% 28.85% 7.46% 5.96% -1.15% 27.75% 22.76% 29.92% 6.38%
89 90 91 92 93 94 95 96 97 98
Best Quarter: First Quarter 1991 +16.67%
Worst Quarter: Third Quarter 1990 -12.63%
<PAGE>
Average annual total return as of 12/31/98
1 Year 5 Years 10 Years
Sentry Fund 6.4% 16.5% 15.2%
S&P 500 Index(R) 28.5% 23.9% 19.1%
* S&P 500 Indexr is an unmanaged index generally
representative of the U.S. stock market.
FEES AND EXPENSES OF THE FUND
This table describes the fees and expenses that you may
pay if you buy and hold shares of the Fund.
Shareholder Fees (fees paid directly from your
investment): None
Annual Fund Operating Expenses (expenses that are
deducted from Fund assets*)
Management Fees .75%
Distribution and Services (12b-1) Fees None
Other Expenses .08%
Total Annual Fund Operating Expenses .83%
* Fund operating expenses are deducted from Fund
assets before computing the daily share price or making
distributions. As a result, they will not appear on
your account statement, but instead, reduce the amount
of total return you receive.
Example
This example is intended to help you compare the cost
of investing in the Fund with the cost of investing in
other mutual funds.
The example assumes that you invest $10,000 in the Fund
for the time periods indicated and then redeem all of
your shares at the end of those periods. The example
also assumes that your investment has a 5% return each
year, and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or
lower, based on these assumptions, your costs would be
as follows:
1 year $ 87
3 years $ 273
5 years $ 475
10 years $1,056
<PAGE>
INVESTMENT OBJECTIVE
The Fund's investment objective is long-term capital growth.
HOW THE FUND INVESTS
The Adviser generally follows a "growth at a reasonable
price" approach to investing for the Fund. The Fund
will focus on equity securities of companies which, in
the opinion of the Adviser, have prospects for above-
average growth. In determining which securities to
purchase, the Adviser will take into consideration both
growth prospects and valuation. In evaluating
individual companies, the Adviser reviews certain
criteria which it believes are important, such as:
Above average growth;
Strong balance sheet;
Low price to earnings ratio relative to growth;
Shareholder-oriented management;
Above average return on equity; and
Proprietary products.
The securities the Adviser selects typically possess
some, but not all, of the above attributes.
The Fund typically sells a security when the Adviser
believes it has achieved its target price, shows
deteriorating fundamentals, or other securities are
better values.
Under normal circumstances, the Fund will invest most
of its assets in common stocks. Common stocks are
units of ownership of a corporation. Equity funds like
the Fund are subject to stock market risks and
significant fluctuations in value. If the stock market
declines in value, the Fund is likely to decline in
value. Increases or decreases in the value of stocks
are generally greater than for bonds and other debt
investments. In addition the stocks selected by the
Adviser may decline in value or not increase in value
when the stock market in general is rising.
To respond to adverse market, economic, political or
other conditions, the Fund may invest all or a
substantial portion of its assets in short-term
obligations or fixed-income obligations as temporary,
defensive measures. To the extent the Fund uses
temporary, defensive measures, the Fund may not achieve
its investment objective. See the Fund's SAI for a
more complete discussion of these temporary
investments.
<PAGE>
FUND MANAGEMENT
Investment Adviser
The Adviser manages and directs the Fund's investments,
subject to the review of the Fund's Board of Directors.
The Adviser is also responsible for portfolio
transactions and brokerage services.
The Adviser is located at 1800 North Point Drive,
Stevens Point, Wisconsin 54481, and is a wholly-owned
subsidiary of Sentry Insurance a Mutual Company
("Sentry Insurance"). The Adviser, which has been in
the business of providing investment advice for over 23
years, also provides investment management services to
Sentry Insurance and its affiliated companies.
Pursuant to an Investment Advisory Agreement between
the Fund and the Adviser, the Fund pays the Adviser a
quarterly fee computed by using annual rates based on
the average daily net asset value of the Fund during
the quarter. For the fiscal year ended October 31,
1998, the fee paid by the Fund to the Adviser was .75%
of the Fund's average net assets.
Pursuant to the Investment Advisory Agreement, if the
total expenses of the Fund (excluding taxes, portfolio
brokerage commissions and interest, but including the
investment advisory fee) exceed the sum of 1-1/2% of
the first $30,000,000 and 1% of the balance of the
average daily net asset value of the Fund in any one
fiscal year, the Adviser will reimburse the Fund for
such excess. This expense limitation is taken into
consideration with each payment of the management fee.
Portfolio Manager
Keith E. Ringberg, the Adviser's Director of Equity
Management, is primarily responsible for the day-to-day
management of the Fund's investment portfolio. Mr.
Ringberg received a B.A. degree from Milton College in
1972, and a M.B.A. from Western Illinois University in
1974. Mr. Ringberg has been employed by the Adviser
for the past 23 years, and has managed the Fund's
portfolio for the past 15 years.
Underwriter and Transfer Agent
Sentry Equity Services, Inc. ("Sentry Equity"), 1800
North Point Drive, Stevens Point, Wisconsin 54481, a
registered broker-dealer and member of the National
Association of Securities Dealers, Inc., acts as
underwriter for the Fund pursuant to an Underwriter
Agreement. Sentry Equity is a wholly-owned subsidiary
of Sentry Insurance, and is therefore affiliated with
the Adviser and the Fund.
Under a separate Agency Agreement, Sentry Equity also
serves as the Fund's Transfer Agent, Dividend
Disbursing Agent, and Plan Agent.
<PAGE>
HOW TO PURCHASE SHARES
You may purchase Fund shares by opening an account
through any Sentry Equity sales agent or directly
through Sentry Equity's office at 1800 North Point
Drive, Stevens Point, Wisconsin 54481, telephone (800)
533-7827.
To open an account:
Complete and sign the account Application.
Send the Application, along with a check for the
initial investment amount, to Sentry Equity at the
address given above.
Your check should be made payable to "Sentry Fund,
Inc." Payment must be made by check drawn on a U.S.
bank, savings and loan, or credit union. Cash, third-
party checks, and checks made payable to "Sentry
Equity" or "Sentry Equity Services, Inc." will not be
accepted.
If your check does not clear, you may be charged a
$20 service fee.
All applications to purchase Fund shares are
subject to acceptance by the Fund and are not binding
until so accepted. The Fund reserves the right to
decline or accept a purchase application in whole or in
part.
Minimum Investments
Initial Investment Subsequent
Investment
Regular Account (Open Purchase Plan): $500 $ 50
Planned Automatic Investment Draft Plan
("PAID" Plan): $200 $ 20
Periodic Purchase Plan: $500 $240 annually
Employer-Sponsored Payroll Deduction Plan: $200 $ 10 per pay period
Traditional IRAs: $500 $ 50
Roth IRAs: $500 $ 50
Education IRAs: $500 N/A
The Fund may change or waive these minimums at any
time; you will be given at least 30 days' notice of any
increase in the minimum dollar amount of purchases.
Purchases which would result in the investor owning,
either beneficially or of record, more than 4.9% of the
Fund's outstanding shares will not be accepted unless
the investor enters
<PAGE>
into an agreement with the Fund
which takes into account the interests of all Fund
shareholders. The Fund will redeem the shares of any
investor in excess of 4.9% of the Fund's outstanding
shares if the investor does not enter into such an
agreement. Sentry Insurance and its affiliated
companies are excluded.
Stock Certificates
The Fund will not issue stock certificates unless they
are requested. Sentry Equity will maintain an account
for you that will record your Fund share holdings to
three decimal places. By making a written request to
Sentry Equity, you may obtain a certificate
representing full shares at no cost.
Distributions
All distributions of investment income (dividends) or
net realized capital gains will be paid in shares of
the Fund, which will be added to your account at net
asset value. See "Distributions to Shareholders and
Taxation." However, if you have a Regular Account, you
may receive all your distributions, or only those
distributions representing investment income, in cash
if you elect to do so on the Application or by written
notice to Sentry Equity.
Confirmations
A written confirmation will be mailed to you each time
a transaction occurs which changes the number of shares
you own. The confirmation will give details of the
transaction and state the number of shares you owned
before and after the transaction.
SPECIAL SERVICES FOR SHAREHOLDERS
The Fund offers the following services to shareholders.
Additional information about these services is
available by contacting Sentry Equity at (800) 533-
7827. The Fund may modify or terminate these services
at any time.
Participation in any of the Fund's investment plans is
entirely voluntary and you may discontinue or convert
to another plan at any time subject to certain
restrictions or penalties for IRA plans.
Planned Automatic Investment Draft Plan
The Planned Automatic Investment Draft ("PAID") Plan is
offered by Sentry Equity to allow the purchase of Fund
shares at regular intervals. Based on your
authorization, an automatic withdrawal is made by
Sentry Equity from your bank account each month to
purchase shares of the Fund. This ensures that the
purchase schedule you select is maintained. There is
no extra charge for this service. Contact Sentry
Equity for a PAID Plan application. For more
information on the PAID Plan, see the Fund's SAI.
<PAGE>
Periodic Purchase Plan
Under the Periodic Purchase Plan, you may elect to make
regular investments of a specified amount either
monthly, quarterly or semi-annually. This plan
requires a minimum annual investment of $240. The
amount and frequency of payments (including additional
payments) may vary as long as the minimum initial
purchase of $500 and minimum annual purchase of $240
requirements are met.
Payroll Deduction
Employer-sponsored payroll deduction plans are designed
for investors who wish to make purchases of Fund shares
at regular intervals. You may enroll in this plan by
making an initial purchase of $200 or more and
completing the Application. For additional investments
made under an employer-sponsored payroll deduction
plan, the minimum purchase is $10 per pay period.
Purchases are entirely voluntary.
Systematic Withdrawal Plan
If you own $5,000 or more of Fund shares (the shares
cannot be in certificate form), you may request
quarterly payments from your account of at least $50,
payable to you or to your designated payee. For
accounts of $10,000 or more, monthly payments can be
made. Ordinarily, sufficient shares will be redeemed
from your account for the amount of the payment on the
20th day of the month. A check will be mailed to you
or your designated payee within three business days
thereafter.
To establish a Systematic Withdrawal Plan, complete the
appropriate section of the Application. For more
information, see the Fund's SAI.
Individual Retirement Accounts
The Fund offers three types of individual retirement
accounts (IRAs): the Traditional (deductible) IRA, the
Roth IRA, and the Education IRA. See the Fund's SAI
for a more complete explanation of these IRAs.
HOW TO REDEEM SHARES
You may request redemption of all or part of your Fund
shares at any time. The price per share will be the
net asset value next computed, less any applicable
income tax withholding, after the time the redemption
request is received in proper form by Sentry Equity.
See "Valuation of Fund Shares." You may contact Sentry
Equity at (800) 533-7827 for more information
concerning redemption of Fund shares. Your redemption
proceeds will be mailed promptly, but no later than
seven days after receipt of a redemption request in
good order. The redemption price of shares may be more
or less than your cost when you purchased the shares,
depending on the market value of the securities owned
by the Fund at the time of redemption.
<PAGE>
If you redeem shares through a financial intermediary
(such as a broker-dealer), the financial intermediary
may charge you transaction fees for its services. You
will not be charged a fee if you redeem your Fund
shares directly through Sentry Equity without the
intervention of a financial intermediary.
Written Redemptions
For most redemption requests, you need only furnish a
written, unconditional request to redeem your shares at
net asset value to Sentry Equity Services, Inc., 1800
North Point Drive, Stevens Point, Wisconsin 54481. If
shares are not represented by stock certificates, a
redemption request form available from Sentry Equity,
or a letter, may be used for the request. Written
redemption requests received via facsimile transmission
will be processed, but funds will not be released until
the original, signed redemption request has been
received by Sentry Equity at its office in Stevens
Point, Wisconsin. Requests for redemption must be
signed exactly as the shares are registered, including
the signature of each owner if owned jointly, and must
specify the number of shares or dollar amount to be
redeemed. Each signature must be guaranteed by a
registered representative of Sentry Equity, a
commercial bank, trust company, member of a stock
exchange, savings and loan association or savings bank,
or other eligible financial institution. A notary
public stamp or seal is not acceptable. The guarantee
may be waived by Sentry Equity on redemptions of
$10,000 or less. If the redemption request is from a
qualified plan, proper withholding and request for
redemption forms must be completed.
Stock Certificates
If shares are represented by stock certificates, the
form on the back of each certificate must be used to
redeem shares. The stock certificate must be signed
exactly as the account is registered. If the account
is owned jointly, both owners must sign.
Special Situations
Under certain circumstances (such as corporate or
fiduciary registrations), Sentry Equity may require
additional documents (such as inheritance tax waivers,
death certificates or corporate resolutions) before the
proceeds of a redemption can be paid.
The Fund may suspend the right of redemption and the
determination of net asset value of its shares under
the following unusual circumstances: when the New York
Stock Exchange is closed (other than weekends and
holidays) or trading is restricted; when an emergency
exists, as determined by the SEC, making disposal of
portfolio securities or the valuation of net assets not
reasonably practicable; or during any period when the
SEC has by order permitted a suspension of redemption
for the protection of shareholders. In that event,
redemption will be effected at the net asset value next
determined after the suspension has been lifted unless
the shareholder has withdrawn the redemption request.
If you have been a shareholder for at least five years
and the aggregate value of your shares does not exceed
$200, the Fund reserves the right to close your
account. Before such action is taken, you will be
provided with six months' prior written notice.
<PAGE>
The Fund has the right to redeem Fund shares in whole
or in part with portfolio securities (i.e., redemption-
in-kind). For more information, please consult the
SAI.
VALUATION OF FUND SHARES
Net asset value is calculated by taking the value of
the Fund's total assets, including interest or
dividends accrued, but not yet collected, less all
liabilities, and dividing by the total number of shares
outstanding. The result, rounded to the nearest cent,
is the net asset value per share. The net asset value
per share is determined as of the close of trading
(generally 4:00 p.m., Eastern Standard Time) on each
day the New York Stock Exchange is open for business.
The New York Stock Exchange is closed on weekends and
national holidays. Net asset value is not determined
on days the New York Stock Exchange is closed. The
price at which a purchase order or redemption request
is effected is based on the next calculation of net
asset value after the order or request is placed.
Orders received by Sentry Equity prior to the close of
trading on the New York Stock Exchange and prior to the
close of the Fund's business day will be confirmed at a
price based on the net asset value effective as of the
close of the New York Stock Exchange on that day with
payment to follow.
DISTRIBUTIONS TO SHAREHOLDERS AND TAXATION
For federal income tax purposes, all dividends and
distributions of short-term capital gains you receive
from the Fund are taxable as ordinary income, whether
reinvested in additional shares or received in cash.
Distributions of long-term capital gains you receive
from the Fund, whether reinvested in additional shares
or received in cash, are taxable as a capital gain.
The capital gain holding period (and the applicable tax
rate) is determined by the length of time the Fund has
held the security and not the length of time you have
held shares in the Fund. The Fund expects that,
because of its investment objective, its distributions
will consist primarily of long- and short-term capital
gains. You will be informed annually of the amount and
nature of all dividends and capital gains paid during
the prior year. Capital gains and dividends may also
be subject to state or local taxes. If you are not
required to pay taxes on your income, you will
generally not be required to pay federal income taxes
on the distributions made to you by the Fund.
The Fund intends to declare dividends in June and
December, and to distribute any capital gains annually
with the December dividend. Any dividend that is
declared in October, November or December as of a
record date in one of those months, but is actually
paid to shareholders during the following January is
"deemed" to have been received by shareholders on
December 31 of the calendar year it was declared.
When a dividend or capital gain is distributed, the
Fund's net asset value decreases by the amount of the
distribution. If you purchase shares shortly before a
distribution, you will be subject to income taxes on
the distribution, even though the value of your
investment (plus cash received, if any) remains the
same. All dividends and capital gains distributions
will automatically be reinvested in additional Fund
shares at the then-prevailing net asset value.
<PAGE>
If you
participate in an Open Purchase Plan, you may request
your dividend and capital gains distributions, if any,
in cash.
If you do not furnish the Fund with your correct social
security number or taxpayer identification number, the
Fund is required by federal law to withhold federal
income tax from your distributions and redemption
proceeds at a rate of 31%.
This section is not intended to be a full discussion of
federal income tax laws and the effect of such laws on
you. There may be other federal, state or local tax
considerations applicable to a particular investor.
You are urged to consult your own tax adviser.
YEAR 2000 ISSUE
The Fund's operations depend on the seamless
functioning of computer systems in the financial
service industry. Many computer software systems in
use today cannot properly process date-related
information after December 31, 1999, because of the
method by which dates are encoded and calculated. This
failure, commonly referred to as the "Year 2000 Issue,"
could adversely affect the handling of security trades,
pricing and account servicing for the Fund.
The Fund has made compliance with the Year 2000 Issue a
priority and is taking steps that it believes are
reasonably designed to address the Year 2000 Issue.
Because the Fund has no computer software system of its
own, Sentry Equity's and the Adviser's computer systems
are the focus of the Fund's efforts. Both Sentry
Equity and the Adviser have represented to the Fund
that they do not currently anticipate that the Year
2000 Issue will have a material impact on their ability
to continue to fulfill their duties as service
providers to the Fund. However, there can be no
assurance that the computer systems of the companies in
which the Fund invests will be compliant or that the
value of such investments will not be adversely
affected by the Year 2000 Issue.
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you
understand the Fund's financial performance for the
past 5 years. Certain information reflects financial
results for a single Fund share. The total returns in
the table represent the rate that an investor would
have earned [or lost] on an investment in the Fund
(assuming reinvestment of all dividends and
distributions). This information has been audited by
PricewaterhouseCoopers LLP, whose report, along with
the Fund's financial statements, are included in the
Fund's Annual Report for the year ended October 31,
1998, which is available on request.
<TABLE>
<CAPTION>
Year Ended October 31,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 23.95 $ 18.19 $ 16.29 $ 15.39 $ 15.93
Income from Investment Operations
Net Investment Income .11 .13 .17 .18 .18
Net Realized and Unrealized Gains
(Losses) on Investments (.30) 6.70 3.01 1.65 .53
Total from Investment Operations (.19) 6.83 3.18 1.83 .71
Less Distributions
Dividends From Net Investment Income (.11) (.16) (.17) (.17) (.22)
Distribution From Net Realized Gains (3.85) (.91) (1.11) (.76) (1.03)
Total Distributions (3.96) (1.07) (1.28) (.93) (1.25)
Net Asset Value End of Period $ 19.80 $ 23.95 $ 18.19 $ 16.29 $ 15.39
Total Return (.76%) 39.23% 20.60% 12.97% 4.86%
Net Assets, End of Period
(in Thousands) $ 111,850 $ 118,278 $ 97,154 $ 84,374 $ 79,622
Ratio of Expenses to Average
Net Assets .83% .83% .84% .86% .86%
Ratio of Net Investment Income to
Average Net Assets .55% .61% .95% 1.17% 1.19%
Portfolio Turnover Rate 29.85% 40.75% 28.28% 26.54% 16.31%
</TABLE>
<PAGE>
INVESTMENT ADVISER
Sentry Investment Management, Inc.
1800 North Point Drive
Stevens Point, WI 54481
UNDERWRITER
Sentry Equity Services, Inc.
1800 North Point Drive
Stevens Point, WI 54481
CUSTODIAN
Citibank, N.A.
399 Park Avenue
New York, NY 10022
LEGAL COUNSEL
Godfrey & Kahn
780 North Water Street
Milwaukee, WI 53202
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
203 North LaSalle
Chicago, IL 60601
The SAI for the Fund contains additional information
about the Fund. Additional Information about the
Fund's investments is contained in the Fund's annual
and semi-annual reports to shareholders. The Fund's
annual report provides a discussion of the market
conditions and investment strategies that significantly
affected the Fund's performance during its last fiscal
year. The Fund's SAI, which is incorporated by
reference into this Prospectus, annual reports and semi-
annual reports are available without charge upon
request to the address or toll-free telephone number
noted on the cover of this Prospectus. These documents
are also available from Sentry Equity. General
inquiries regarding the Fund can be directed to the
Fund at the address and toll-free telephone number on
the coverage page of this Prospectus.
Information about the Fund (including the SAI) can be
reviewed and copied at the SEC's Public Reference Room
in Washington, D.C. Please call the SEC at 1-800-SEC-
0330 for information relating to the operation of the
Public Reference Room. Reports and other information
about the Fund are also available on the SEC's Internet
Website located at http://www.sec.gov. Alternatively,
copies of this information may be obtained, upon
payment of a duplicating fee, by writing the Public
Reference Section of the SEC, Washington, D.C. 20549-
6009.
The Fund's 1940 Act File Number is 811-1861
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
SENTRY FUND, INC.
1800 North Point Drive
Stevens Point, WI 54481
Telephone (800) 533-7827
This Statement of Additional Information is not a
prospectus and should be read in conjunction with the
Prospectus of Sentry Fund, Inc. (the "Fund") dated
March 1, 1999.
A copy of the Fund's Prospectus is available without
charge by writing or calling Sentry Equity Services,
Inc. at 1800 North Point Drive, Stevens Point, WI
54481, (800) 533-7827.
The Fund's audited financial statements for the year
ended October 31, 1998 are incorporated herein by
reference to the Fund's 1998 Annual Report.
Date: March 1, 1999
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TABLE OF CONTENTS
FUND ORGANIZATION 2
INVESTMENT RESTRICTIONS 2
IMPLEMENTATION OF INVESTMENT OBJECTIVES 4
DIRECTORS AND OFFICERS 7
PRINCIPAL SHAREHOLDERS 9
INVESTMENT ADVISER AND OTHER SERVICES 9
BROKERAGE PRACTICES 11
UNDERWRITER AND TRANSFER AGENT 12
CUSTODIAN 13
PURCHASE, REDEMPTION AND PRICING 13
TAXATION OF THE FUND 16
PERFORMANCE INFORMATION 16
INDEPENDENT ACCOUNTANT 17
FINANCIAL STATEMENTS 17
In deciding whether to invest in the Fund, you should
rely on information in this Statement of Additional
Information and the Fund's Prospectus dated March 1,
1999. The Fund has not authorized others to provide
you with additional information. The Fund has not
authorized the use of this Statement of Additional
Information in any state or jurisdiction in which an
offer to sell shares of the Fund may not lawfully be
made.
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FUND ORGANIZATION
Sentry Fund, Inc. is a no-load, diversified, open-end
management investment company. The Fund is a
corporation organized under the laws of the State of
Maryland on May 9, 1969. The Fund is authorized to
issue shares of common stock, each of the same class.
Each share has equal, non-cumulative rights as to
voting (with each full share entitled to one vote),
redemption, dividends and liquidation.
No certificates will be issued for shares held in your
account unless requested. However, you will have full
shareholder rights.
Generally, the Fund will not hold annual shareholders'
meetings unless required by the Investment Company Act
of 1940, as amended (the "1940 Act"), or Maryland law.
Shareholders have certain rights, including the right
to call an annual meeting upon a vote of 10% of the
Fund's outstanding shares for the purpose of voting to
remove one or more directors or to transact any other
business. The 1940 Act requires the Fund to assist the
shareholders in calling an annual meeting.
INVESTMENT RESTRICTIONS
Listed below are the Fund's fundamental investment
policies which cannot be changed without the approval
of a majority of the Fund's outstanding voting
securities. As used herein, a "majority of the Fund's
outstanding voting securities" means the lesser of (1)
67% or more of the shares of the Fund represented at a
meeting at which holders of more than 50% of the
outstanding shares of the Fund are present or
represented by proxy, or (2) more than 50% of the
outstanding shares of the Fund.
The Fund may not:
1. Issue senior securities, except as permitted under
the 1940 Act;
2. Borrow money except from banks as a temporary
measure for extraordinary or emergency purposes
and then not in excess of the lesser of 5% of the
current value of the Fund's total assets or 10% of
the Fund's gross assets taken at cost;
3. Pledge or mortgage assets of the Fund with a
current value in excess of 15% of the value of the
Fund's net assets taken at cost;
4. Invest more than 25% of the current value of its
total assets in a particular industry or group of
industries;
5. Underwrite securities of other issuers;
6. Buy and sell commodities or commodity contracts;
7. Buy and sell puts, calls, straddles, spreads or options;
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8. Buy and sell real estate or other interests in
real estate which are not readily convertible into
cash;
9. Make loans to other persons except through the
purchase of a portion of a publicly distributed
issue of bonds or other marketable obligations;
10. Invest more than 5% of the current value of its
total assets in the securities of any one issuer
(other than United States government securities)
if such purchase would cause the current value of
the Fund's investments in all such companies to
exceed 5% of the current value of the Fund's total
assets.
11. Buy or retain securities issued by any other
investment company, except that securities of
closed-end investment companies may be purchased
as part of a plan of merger or through a broker
who is paid no more than the usual or customary
brokerage commissions;
12. Buy or retain securities of any issuer if those
officers and directors of the Fund or its
investment adviser, who own individually more than
1/2% of the securities of such issuer, together own
beneficially more than 5% of such securities;
13. Buy securities on margin or sell securities short;
14. Participate, on a joint or a joint and several
basis, in any trading account in securities;
15. Buy securities if a registration statement would
have to be filed under the Securities Act of 1933
in order to sell the securities to the public at
the time of purchase (such securities are
frequently called "letter" or "restricted" stock);
and
16. Invest more than 10% of the value of the Fund's
total assets in securities of foreign issuers.
The Fund's objective, which is to seek long-term
capital growth, is also a fundamental investment policy
which cannot be changed without the approval of a
majority of the Fund's outstanding voting securities.
In addition, the Fund maintains the following
investment restrictions which may be changed by the
Board of Directors without shareholder approval:
1. The Fund will not invest more than 5% of its total
assets in securities of unseasoned issuers, including
their predecessors, which have been in operation for
less than three years, and equity securities of issuers
which are not readily marketable.
2. The Fund will not invest any part of its total
assets in oil, gas or other mineral exploration,
development or lease programs.
3. The Fund will not pledge, mortgage or hypothecate
its assets in excess of 2% of its net assets taken at
market value at the time of any sale of its shares.
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4. The Fund will not invest in warrants exceeding 5%
of the value of its net assets, no more than 2% of
which may be warrants not listed on the New York Stock
Exchange or the American Stock Exchange.
5. The Fund will not invest in securities that are
not readily saleable, including securities with legal
or contractual restrictions on resale if, as a result
thereof, more than 10% of the Fund's total assets
(taken at market value at the time of purchase) would
be invested in such securities.
The Fund is permitted to invest in securities issued by
broker-dealers that execute the Fund's portfolio
brokerage transactions. The Fund will not invest more
than 5% of the value of its total assets in the
securities of any one such issuer nor will the Fund own
more than 5% of a class of such an issuer's equity
securities nor more than 10% of the outstanding
principal amount of such issuer's debt securities.
Unless otherwise noted, if a percentage restriction is
adhered to at the time of investment, a later increase
or decrease in percentage resulting from a change in
the Fund's assets (i.e., due to cash inflows or
redemptions) or in the market value of the investment
will not constitute a violation of that restriction.
IMPLEMENTATION OF INVESTMENT OBJECTIVES
The following information supplements the discussion of
the Fund's investment objectives described in the
Prospectus under the caption "How the Fund Invests."
Small Capitalization Companies
The Fund may, from time to time, invest in small
capitalization companies. While small-cap companies
generally have the potential for rapid growth,
investments in small-cap companies often involve
greater risks that investments in larger, more
established companies because small-cap companies may
lack the management experience, financial resources,
product diversification, and competitive strengths of
larger companies. In addition, in many instances, the
securities of small-cap companies are traded only over-
the-counter or on a regional securities exchange, and
the frequency and volume of their trading is
substantially less than is typical of larger companies.
Therefore, the securities of small-cap companies may be
subject to greater and more abrupt price fluctuations.
When making large sales, the Fund may have to sell
portfolio holdings at discounts from quoted prices or
may have to make a series of small sales over an
extended period of time due to the trading volume of
small-cap company securities.
You should know that based on the foregoing factors, an
investment in the Fund may be subject to greater price
fluctuations than an investment in a fund that limits
its investments to larger, more established companies.
The research efforts of the Fund's investment adviser
may also play a greater role in selecting securities
for the Fund than in a fund that invests in larger,
more established companies.
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Convertible Securities
The Fund may invest in convertible securities, which
are bonds, debentures, notes, preferred stocks, or
other securities that may be converted into or
exchanged for a specified amount of common stock of the
same or a different issuer within a particular period
of time at a specified price or formula. A convertible
security entitles the holder to receive interest
normally paid or accrued on debt or the dividend paid
on preferred stock until the convertible security
matures or is redeemed, converted or exchanged.
Convertible securities have unique investment
characteristics in that they generally (1) have higher
yields than common stocks, but lower yields than
comparable non-convertible securities; (2) are less
subject to fluctuation in value than the underlying
stock since they have fixed income characteristics; and
(3) provide the potential for capital appreciation if
the market price of the underlying common stock
increases.
The value of a convertible security is a function of
its "investment value" (determined by its yield in
comparison with the yields of other securities of
comparable maturity and quality that do not have a
conversion privilege) and its "conversion value" (the
security's worth, at market value, if converted into
the underlying common stock). The investment value of
a convertible security is influenced by changes in
interest rates with investment value declining as
interest rates increase and increasing as interest
rates decline. The credit standing of the issuers and
other factors also may have an effect on the
convertible security's investment value. The
conversion value of a convertible security is
determined by the market price of the underlying common
stock. If the conversion value is low relative to the
investment value, the price of the convertible security
is governed principally by its investment value.
Generally, the conversion value decreases as the
convertible security approaches maturity. To the
extent the market price of the underlying common stock
approaches or exceeds the conversion price, the price
of the convertible security will be increasingly
influenced by its conversion value. A convertible
security generally will sell at a premium over its
conversion value by the extent to which investors place
value on the right to acquire the underlying common
stock while holding a fixed income security.
A convertible security might be subject to redemption
at the option of the issuer at a price established in
the convertible security's governing instrument. If a
convertible security held by the Fund is called for
redemption, the Fund will be required to permit the
issuer to redeem the security, convert it into the
underlying common stock, or sell it to a third party.
Warrants
Warrants are options to purchase equity securities at a
specified price during a specified period of time.
They do not represent ownership of the securities, but
only the right to buy the securities. Investing in
warrants is pure speculation because warrants have no
voting rights, pay no dividends and have no rights with
respect to the assets of the issuer. The price of
warrants does not necessarily move parallel to the
price of the underlying securities.
The Fund may invest in warrants, if after such
investment, not more than 5% of its net assets will be
invested in warrants other than warrants acquired in
units or attached to other securities. Of such 5%, not
more than 2% of the Fund's net assets at the time of
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purchase may be invested in warrants that are not
listed on the New York Stock Exchange or the American
Stock Exchange.
Temporary Investments
Short-Term Obligations. In times when the Fund's
investment adviser believes that adverse market,
economic, political or other conditions justify such
action, the Fund may invest all or a substantial
portion of its assets temporarily in short-term fixed-
income securities, including, without limitation, the
following:
U.S. government securities, including bills, notes
and bonds, differing as to maturity and rate of
interest, which are either issued or guaranteed by the
U.S. Treasury or by U.S. governmental agencies or
instrumentalities;
Certificates of deposit issued against funds
deposited in a U.S. bank or savings and loan
association;
Bank time deposits, which are monies kept on
deposit with U.S. banks or savings and loan
associations for a stated period of time at a fixed
rate of interest;
Bankers' acceptances, which are short-term credit
instruments used to finance commercial transactions;
Repurchase agreements entered into only with
respect to obligations of the U.S. government, its
agencies or instrumentalities; or
Commercial paper and commercial paper master notes
rated investment grade or better, which are demand
instruments without a fixed maturity date bearing
interest at rates that are fixed to known lending rates
and automatically adjusted when such lending rates
change.
Fixed Income Obligations. Fixed income obligations in
which the Fund may invest for temporary, defensive
purposes will be primarily investment-grade debt
obligations or determined to be comparable by the
Fund's investment adviser. The market value of all
debt obligations is affected by changes in the
prevailing interest rates. The market value of such
instruments generally reacts inversely to interest rate
changes. If the prevailing interest rates decline, the
market value of debt obligations generally increases.
If the prevailing interest rates increase, the market
value of debt obligations generally decreases. In
general, the longer the maturity of a debt obligation,
the greater its sensitivity to changes in interest
rates.
Portfolio Turnover
Portfolio turnover rate is a measure of the purchase
and sale activity of the securities in the Fund's
portfolio during a one-year period. Since the Fund's
primary objective is to purchase securities for long-
term appreciation, securities are not purchased with a
view to rapid turnover. Therefore, the Fund does not
intend to engage in short-term trading. Purchases and
sales of securities are made whenever the Fund's
investment adviser believes the possibilities for long-
term appreciation of a security have diminished
significantly or the risk
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of decline in the market
price is too great. For the fiscal years ended October
31, 1998 and 1997, the Fund's portfolio turnover rates
were approximately 29.9% and 40.8%, respectively.
DIRECTORS AND OFFICERS
Under the laws of the State of Maryland, the Board of
Directors of the Fund is responsible for managing its
business and affairs. The Directors and officers of
the Fund, together with information as to their
principal business occupations during the last five
years, are shown below. The address of each Director
and officer is 1800 North Point Drive, Stevens Point,
Wisconsin 54481, except as noted below. Each Director
who is deemed an "interested person" as defined in the
1940 Act is indicated by an asterisk. The office of
President is currently vacant.
*Dale R. Schuh, age 50, Chairman of the Board
Mr. Schuh has been Chief Executive Officer and
President of Sentry Insurance a Mutual Company
("Sentry Insurance") since January 1998. He
served as President and Chief Operating Officer
from November 1996 to December 1997; as
Executive Vice President and Chief Operating
Officer from November 1995 to November 1996;
and as Sr. Vice President from 1992 to 1995,
all with Sentry Insurance. Mr. Schuh also
serves as a Director of the following
companies: Sentry Insurance; the Fund's
investment adviser, Sentry Investment
Management, Inc. (the "Adviser"); and the
Fund's underwriter, Sentry Equity Services,
Inc. ("Sentry Equity"). He has been Chairman
of the Board of the Fund since 1993.
* Susan M. DeBruin, age 47, Vice President of the Fund
Ms. DeBruin has been Vice President of the Fund
since June 1998, and President of Sentry Equity
since April 1998. Prior to that, Ms. DeBruin
had been a sales development consultant and
compliance consultant for Sentry Insurance
since 1986.
*William M. O'Reilly, age 44, Secretary
Mr. O'Reilly has been Vice President, General
Counsel and Corporate Secretary of Sentry
Insurance since January 1994. He also serves
as a Director and Secretary of the Adviser and
Sentry Equity, and has been Secretary of the
Fund since 1992.
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*William J. Lohr, age 49, Director and Treasurer
Mr. Lohr has been Vice President and Treasurer
of Sentry Insurance since April 1997. He
served as Vice President and Treasurer of
Citizens Insurance Company of America from 1981
to 1997. Mr. Lohr also serves as a Director
and Treasurer of the Adviser and Sentry Equity.
Thomas R. Copps, age 59, Director
2828 Wayne Street, Stevens Point, WI 54481
Mr. Copps has been Vice President-Public
Relations of the Copps Corporation, a retail
and wholesale distributor of food products,
since May 1979. He has been a Director of the
Fund since 1983.
David W. Graebel, age 69, Director
401 South Airport Blvd., Aurora, CO 80017-2122
Mr. Graebel has been Chairman of the Board of
Graebel Companies, Inc., a moving and storage
company, and its subsidiaries since 1950. He
has been a Director of the Fund since 1969.
Steven J. Umland, age 43, Director
11925 West Lake Park Drive, Milwaukee, WI 53224
Mr. Umland has been Vice President-Finance of
Ministry HealthCare, Inc., a hospital
management service corporation, since 1991.
He has been a Director of the Fund since 1995.
As of February 1, 1999, the Directors and Officers as a
group owned less than 1% of the outstanding shares of
the Fund.
The Fund pays each Director who is not an "interested
person" of the Fund $250 quarterly as a retainer fee
for his services as a Director. These Directors
received an aggregate of $3,000 in fees during the
fiscal year ended October 31, 1998. Officers and
Directors who are "interested persons" of the Fund
receive no compensation from the Fund for their
services.
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PRINCIPAL SHAREHOLDERS
As of February 1, 1999, the following persons owned of
record or are known by the Fund to own of record or
beneficially 5% or more of the Fund's outstanding
shares:
Name and Address Number of Shares Percentage
Sentry Insurance a Mutual Company 1,382,364 23%
1800 North Point Drive
Stevens Point, WI 54481
Bank One Wisconsin Trust Co., N.A. 2,028,834 33%
as Trustee of Sentry 401(k) Plan
601 Main Street
Stevens Point, WI 54481
As of February 1, 1999, Bank One Wisconsin Trust Co.,
as Trustee of the Sentry 401(k) Plan, and Sentry
Insurance a Mutual Company, a Wisconsin corporation,
each owned a controlling interest in the Fund.
Shareholders with a controlling interest could affect
the outcome of proxy voting or the direction of the
management of the Fund.
INVESTMENT ADVISER AND OTHER SERVICES
The Adviser has entered into an Investment Advisory
Agreement (the "Agreement") with the Fund. The Adviser
is a wholly-owned subsidiary of Sentry Insurance. The
Fund's underwriter, Sentry Equity, is also a wholly-
owned subsidiary of Sentry Insurance and is therefore
affiliated with the Adviser and the Fund.
The following persons serve on the Adviser's Board of
Directors: Dale R. Schuh, William J. Lohr and William
M. O'Reilly.
Mr. Schuh is also Chief Executive Officer and
President of Sentry Insurance and serves as
an officer or a director of many of its
subsidiary companies.
Mr. Lohr is also Treasurer of the Adviser and
Vice President of Sentry Insurance and serves
as an officer and director of many of its
subsidiary companies.
Mr. O'Reilly is also Secretary of the Adviser
and Vice President, General Counsel and
Corporate Secretary of Sentry Insurance and
serves as an officer and director of many of
its subsidiary companies.
The Agreement provides that the Adviser will furnish
the Fund with office space, facilities and services;
manage the Fund's investments; provide bookkeeping
services; and permit any of the Adviser's officers and
employees to serve, without compensation by the Fund,
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as officers and directors of the Fund if elected to
such positions. The Fund has agreed to pay the Adviser
a fee for its services at the following rates:
Net Asset Value of the Fund Annual Rate
First $150,000,000 0.75%
Next $150,000,000 0.60%
Next $200,000,000 0.525%
Amount over $500,000,000 0.45%
The fee is computed and paid quarterly. During the
fiscal years ended October 31, 1998, 1997, and 1996,
the Adviser's fees for services to the Fund were
$877,820, $810,738, and $689,374, respectively.
If the costs of the underwriter, Sentry Equity, in
fulfilling its obligations to the Fund under the
Underwriter Agreement exceed its ability to operate
profitably, the Adviser may reimburse Sentry Equity for
a portion of its expenses. See "Underwriter and
Transfer Agent."
Certain expenses of the Fund, such as taxes, portfolio
brokerage commissions, the cost of state and federal
securities registrations, printing stock certificates
and checks, preparation of and postage for
shareholders' reports, costs of preparing and printing
prospectuses, fees for maintaining shareholders'
records, custodial fees, transfer agent fees, auditors'
fees, legal fees and unaffiliated directors' fees, are
paid by the Fund.
If the total expenses of the Fund (excluding taxes,
portfolio brokerage commissions and interest, but
including the investment advisory fee) exceed the sum
of 1-1/2% of the first $30,000,000 and 1% of the
balance of the average daily net asset value of the
Fund in any one fiscal year, the Adviser will reimburse
the Fund for such excess. This expense limitation is
taken into consideration with each payment of the
management fee.
The Agreement will continue from year to year so long
as it is approved annually by (1) the vote of a
majority of the Directors of the Fund who are not
"interested persons" of either the Fund or the Adviser,
cast in person at a meeting called for that purpose,
and (2) the vote of the Board of Directors of the Fund
or the vote of a majority of the outstanding voting
securities of the Fund. The Agreement terminates
automatically if assigned. In addition, the Agreement
may be terminated at any time, without penalty, by the
Board of Directors of the Fund or by the vote of a
majority of the outstanding voting securities of the
Fund, by giving at least 60 days' written notice to the
Adviser. The Adviser may terminate the Agreement by
giving at least 60 days' written notice to the Fund.
The Agreement may be amended only with the approval of
a majority of the outstanding voting securities of the
Fund.
The Agreement provides that the Adviser will not be
liable to the Fund or its shareholders, or any other
person, for any error of judgment or for any loss
arising out of any investment or for any other act or
omission in the performance by the Adviser of its
duties under the Agreement except for a loss resulting
from the Adviser's willful misfeasance, bad faith or
gross negligence in performing its duties or reckless
disregard of its obligations and duties under the
Agreement.
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The name "Sentry" and the minuteman service mark have
been adopted by the Fund with the permission of Sentry
Insurance, which has registered these service marks.
Their use is subject to the right of Sentry Insurance
to withdraw this permission at any time. If the
Adviser, or a corporation controlled by or under common
control with Sentry Insurance, ceases to be the
investment adviser for the Fund, the Fund has agreed to
stop using the name "Sentry" and the minuteman design.
BROKERAGE PRACTICES
In placing the Fund's portfolio purchase and sale
orders, it is the Adviser's policy to seek the best
execution of orders at the most favorable price, taking
into account research services which, in effect, are
provided with brokerage commissions as described in
this and the following paragraphs. The determination of
what is expected to result in the best execution at the
most favorable price involves a number of largely
judgmental considerations. Among these are the
Adviser's evaluation of the broker's efficiency in
executing and clearing transactions, the broker's
financial strength and stability, and the Adviser's
previous experience in dealing with the broker. The
most favorable price to the Fund means the best net
price without regard to the mix between purchase or
sale price and commission, if any. Primary market
makers are used for transactions in the over-the-
counter market except in those instances where the
Adviser believes better execution or a more favorable
price can be obtained elsewhere. The Adviser may also
purchase securities listed on stock exchanges from non-
exchange members in transactions off the exchange.
Brokerage services will not be allocated based on the
sale of the Fund shares.
Section 28(e) of the Securities Exchange Act of 1934 as
amended ("Section 28(e)") permits an investment
adviser, under certain circumstances, to cause an
account to pay a broker or dealer who supplies
brokerage and research services a commission for
effecting a transaction in excess of the amount of
commission another broker or dealer would have charged
for effecting the transaction. Brokerage and research
services include (a) furnishing advice as to the value
of securities, the advisability of investing,
purchasing or selling securities, and the availability
of securities or purchasers or sellers of securities;
(b) furnishing analyses and reports concerning issuers,
industries, securities, economic factors and trends,
portfolio strategy, and the performance of accounts;
and (c) effecting securities transactions and
performing functions incidental thereto (such as
clearance, settlement and custody).
In allocating brokerage business for the Fund, the
Adviser takes into consideration the research,
analytical, statistical and other services and
information provided by the broker, such as economic,
securities, and performance measure research.
Selection of brokers or dealers is not made pursuant to
an agreement or understanding with any of the brokers
or dealers. Even though the Adviser negotiates
commissions, the Fund may absorb higher brokerage
commissions than might be available from other brokers
if the amount is believed by the Adviser to be
reasonable in relation to the value of the overall
quality of the brokerage and research services provided
and the payment is made in compliance with the
provisions of Section 28(e) or other applicable federal
and state laws. Other advisory clients may indirectly
benefit from the availability of these services to the
Adviser, and the
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Fund may indirectly benefit from
services available to the Adviser as a result of
transactions for other clients.
The aggregate amount of brokerage commissions paid by
the Fund for the fiscal years ended October 31, 1996,
1997 and 1998, was $48,941, $112,885, and $119,567,
respectively. All of the commissions were paid to
brokers providing research services. Neither the
Adviser nor any company affiliated with the Adviser
receives any brokerage commissions from the Fund.
During the fiscal year ended October 31, 1998, the Fund
did not acquire any stock of its regular brokers or
dealers.
At times, the Adviser may consider purchases or sales
of the same securities for the Fund and for one or more
of its other clients. In such cases, the Adviser will
allocate purchase and sale transactions among its
clients in a manner it deems equitable.
UNDERWRITER AND TRANSFER AGENT
Sentry Equity, 1800 North Point Drive, Stevens Point,
Wisconsin 54481, a wholly-owned subsidiary of Sentry
Insurance, acts as underwriter for the Fund pursuant to
an Underwriter Agreement (the "Agreement").
The Agreement provides that Sentry Equity will use its
best efforts to offer to the public on a continuous
basis shares of the Fund through its sales agents.
Most sales agents also serve as insurance
representatives of Sentry Insurance. Sales agents
receive a commission from Sentry Equity of 1% on all
sales of Fund shares. However, because the Fund is a
"no load" fund, no sales commissions are charged on the
purchase of Fund shares and, therefore, Sentry Equity
receives no commission or other remuneration from the
Fund for its services as underwriter.
Under the Agreement, Sentry Equity has agreed to
furnish clerical and administrative personnel and
services to the Fund and to provide office space,
facilities and equipment required by such personnel,
other than such services as may be provided by the
Adviser.
The Agreement will continue from year to year so long
as it is approved at least annually by (1) the vote of
a majority of the Directors of the Fund who are not
"interested persons" of either the Fund or Sentry
Equity, cast in person at a meeting called for such
purpose, and (2) the vote of the Fund's Board of
Directors or the vote of a majority of the outstanding
voting securities of the Fund. The Agreement
terminates automatically if assigned. In addition, the
Agreement may be terminated at any time, without
penalty, by the Fund's Board of Directors or by the
vote of a majority of the outstanding voting securities
of the Fund, by giving at least 60 days' written notice
to Sentry Equity. Sentry Equity may terminate the
Agreement by giving at least 60 days' written notice to
the Fund.
Sentry Equity also serves the Fund under a separate
Agency Agreement as Transfer Agent, Dividend Disbursing
Agent and Plan Agent (including the maintenance of
shareholder records). For these services, Sentry
Equity is paid an annual fee of $8.50 per shareholder
account. During the fiscal year ended October 31,
1998, $28,261 was paid pursuant to the Agency
Agreement. To handle these functions, Sentry Equity
has contracted with Sentry Insurance for the use of its
extensive information services staff and equipment.
The
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Fund believes the payment by the Fund to Sentry
Equity for the services described in this paragraph are
comparable to the charges of other companies performing
similar services.
CUSTODIAN
Citibank, N.A., 399 Park Avenue, New York, New York
10022, is custodian of the Fund's securities and cash,
and handles receipts and disbursements for the Fund
pursuant to a Custodian Agreement. The custodian
performs no management or policy making functions for
the Fund. Its compensation is based on the number of
shares in the Fund's portfolio and the number of
portfolio transactions.
PURCHASE, REDEMPTION AND PRICING
Planned Automatic Investment Draft (PAID) Plan
The PAID Plan allows you to make regular, systematic
investments in Fund shares by having a set amount
deducted directly from your bank account every month.
By participating in the PAID Plan, you will be
investing a fixed amount of money at regular time
intervals. This is an investment strategy known as
dollar cost averaging. By always investing the same
amount, you will be purchasing more shares when the
price is low and fewer shares when the price is high.
A program of regular investment cannot ensure a profit
or protect against a loss from declining markets.
Individual Retirement Accounts
In addition to purchasing Fund shares as described in
the Prospectus under "How to Purchase Shares,"
individuals may establish their own tax-sheltered
individual retirement accounts ("IRAs").
Traditional IRA. Under a Traditional (deductible) IRA,
earnings accumulate on a tax-deferred basis on annual
IRA contributions equal to the lesser of 100% of
compensation received during the year or $2,000 ($4,000
in the case of a spousal IRA provided certain income
requirements are met). The $2,000 deductible
contribution limit is available only to (1) taxpayers
who are not active participants in certain qualified
retirement plans, and (2) taxpayers who are active
participants in certain qualified plans but have
adjusted gross income below a specified level.
Generally, a taxpayer is deemed an active participant
in a qualified retirement plan if, for any part of the
plan's taxable year that ends in the taxpayer's taxable
year, the taxpayer or the taxpayer's spouse is an
active participant in one of the following: a
qualified pension plan; a qualified profit sharing or
money purchase plan; a 403(b) annuity program; a
simplified employee pension plan; or a government plan
(other than a plan maintained for state and local
employees under Section 457 of the Internal Revenue
Code). A married taxpayer filing a joint return who is
an active participant in a qualified retirement plan
may make a deductible IRA contribution of up to $2,000
($4,000 in the case of a spousal IRA provided certain
income requirements are met).
Roth IRA. Under a Roth IRA, annual non-deductible
contributions of $2,000 can be made (in combination
with a Traditional IRA, whether deductible or not) or
100% of earned
<PAGE>
income if less than $2,000. Spousal
contributions can be made up to $2,000 annually subject
to certain income limitations. Distributions from a
Roth IRA are tax-free after age 59-1/2 if it has been
held more than five years. Distributions before age 59-
1/2 are tax-free if it has been held more than five
years and the owner dies, becomes disabled, or uses the
proceeds for certain purposes. Eligibility for a Roth
IRA is subject to certain income limitations.
Education IRA. Under an Education IRA, parents who
meet certain income eligibility requirements can set up
savings accounts for their children's post-secondary
education. Depending on the parents' income, the
parents may be able to contribute up to $500 annually
for each child until the child turns 18. Although
parents' contributions to Education IRA accounts are
after-tax contributions, all earnings used to pay for
the child's post-secondary education expenses are tax-
free. Earnings not used to pay for the child's post-
secondary education expenses are subject to income tax
and an additional 10% penalty. Any money remaining in
an Education IRA when the child reaches age 30 must be
distributed or rolled over to another eligible family
member to avoid certain taxes. Eligibility for an
Education IRA is subject to certain income limitations.
There are penalties for withdrawals from Traditional
and Roth IRA accounts before age 59-1/2. If you are
considering establishing any IRA, you should consult
with your tax adviser about applicable plan
requirements, contribution limitations, income limits
for eligibility and potential tax liabilities.
Under current IRS regulations, IRA applicants must be
furnished a disclosure statement containing information
specified by the IRS. Applicants generally have the
right to revoke their account within seven days after
receiving the disclosure statement and obtain a full
refund of their contributions. The custodian may, in
its discretion, hold the initial contributions
uninvested until the expiration of the seven-day
revocation period. The custodian does not anticipate
that it will exercise its discretion, but reserves the
right to do so.
Redemption-in-Kind
The Fund has filed a Notification under Rule 18f-1 of
the 1940 Act, pursuant to which it reserves the right,
in extraordinary circumstances, to pay the redemption
price in whole or part in portfolio securities if
deemed advisable by the Board of Directors or any
officer of the Fund. However, this option to redeem in
portfolio securities is limited with respect to each
shareholder during any 90-day period to an amount not
in excess of the lesser of $250,000 or 1% of the net
asset value of the Fund at the beginning of such
period. If redemption is made in portfolio securities,
the shareholder would incur brokerage expenses if he or
she sold the securities received. An officer of the
Fund will only make such a decision in cases of extreme
urgency where there is not sufficient time for the
Board of Directors to act, and such action will be
subsequently reviewed by the Board of Directors.
Other Special Redemption Situations
The Board of Directors may, by resolution as provided
in the Fund's Articles of Incorporation, establish a
redemption fee of not more than 1% of net asset value
for
<PAGE>
redemption of shares which have been outstanding
less than one year. If such a fee is established,
shareholders will be given at least 30 days' advance
notice.
Pursuant to the Fund's Articles of Incorporation, the
Fund may, by resolution of the Board of Directors and
after giving at least six months' written notice to the
shareholder, redeem all shares owned by any shareholder
who (1) has been a shareholder of record for more than
five consecutive years, and (2) does not own shares the
original cost (purchase price) of which exceeds $200 in
the aggregate at the time of redemption. For purposes
of the foregoing, where multiple purchases and
redemptions of shares have occurred and the Fund is
unable to determine the original cost of the shares
held by the shareholder, the Fund will deem those
shares held at the time of such redemption to be those
acquired at the lowest original cost. The Directors
have taken no action on this matter, but may consider
it from time to time. Shareholders will be notified if
the Board of Directors adopts such a resolution.
The Fund intends to exercise its right as provided in
the Articles of Incorporation to redeem at net asset
value any portion of the shares owned beneficially or
of record by any shareholder in excess of 4.9% of the
outstanding shares of the Fund, excluding Sentry
Insurance and its affiliated companies or other
shareholders who have entered into agreements with the
Fund designed to take into account the interests of all
shareholders. This right will not be exercised if a
shareholder's percentage of ownership exceeds 4.9% of
the outstanding shares as a result of redemptions by
other shareholders or the reinvestment of any dividends
or capital gains distributions.
Systematic Withdrawal Plan
Based on the balance of the account, shareholders may
set up automatic quarterly or monthly withdrawals from
their Fund account. Depending on the size of the
account and the withdrawals requested (and fluctuations
in the net asset value of the shares redeemed),
redemptions for the purpose of satisfying such
withdrawals may reduce or even exhaust a shareholder's
account. If the amount remaining in a shareholder's
account is not sufficient to meet a plan payment, the
remaining amount will be redeemed and the systematic
withdrawal plan will be terminated.
Pricing of Shares (Computation of Net Asset Value)
The net asset value per share is computed as of the
close of trading (generally 4:00 p.m., Eastern Standard
Time) on the New York Stock Exchange each day on which
the Exchange is open for trading or on any other day on
which there is a sufficient degree of trading in the
underlying assets of the Fund so that the Fund's net
asset value may be materially affected. The net asset
value of the Fund's shares is determined by dividing
the value of the Fund's total assets, less its
liabilities, by the total number of shares outstanding.
Portfolio securities which are traded or listed on a
national securities exchange are valued at the last
sales price at the time of computation, or, if there
has been no sale on that day, at the last bid price.
Securities traded on the over-the-counter market are
valued at the mean between the last quoted bid and
asked prices at the time of computation, or in the case
of National Market Issues, the last sales price.
Securities for which market quotations are not readily
available, and other assets of the Fund, are valued at
fair value as determined in good faith by the Fund's
Board of Directors.
<PAGE>
TAXATION OF THE FUND
The Fund intends to qualify annually for treatment as a
"regulated investment company" under Subchapter M of
the Internal Revenue Code and, if so qualified, will
not be liable for federal income taxes to the extent
earnings are distributed to shareholders on a timely
basis. In the event the Fund fails to qualify as a
"regulated investment company," it will be treated as a
regular corporation for federal income tax purposes.
In that event, the Fund would be subject to federal
income taxes and any distributions that it makes would
be taxable and non-deductible by the Fund. What this
means to shareholders of the Fund is that the cost of
investing in the Fund would increase. Under these
circumstances, it would be more economical for
shareholders to invest directly in securities held by
the Fund, rather than investing indirectly in such
securities through the Fund.
PERFORMANCE INFORMATION
The Fund's historical performance or return may be
shown in the form of various performance figures. The
fund's performance figures are based on historical
results and are not necessarily representative of
future performance. Factors affecting the Fund's
performance include general market conditions,
operating expenses and investment management.
Total Return
The average annual total return of the Fund is computed
by finding the average annual compounded rates of
return over the periods that would equate the initial
amount invested to the ending redeemable value,
according to the following formula:
n
P(1+T) =ERV
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a
hypothetical $1,000 payment made at the
beginning of the stated periods at the
end of the stated periods
Performance for a specific period is calculated by
first taking an investment (assumed to be $1,000)
("initial investment") in the Fund's shares on the
first day of the period and computing the "ending
value" of that investment at the end of the period.
The total return percentage is then determined by
subtracting the initial investment from the ending
value and dividing the remainder by the initial
investment and expressing the result as a percentage.
The calculation assumes that all income and capital
gains dividends paid by the Fund have been reinvested
at the net asset value of the Fund on the reinvestment
dates during the period. Total return may also be
shown as the increased dollar value of the hypothetical
investment over the period.
<PAGE>
Cumulative total return represents the simple change in
value of an investment over a stated period and may be
quoted as a percentage or as a dollar amount. Total
returns may be broken down into their components of
income and capital (including capital gains and changes
in share price) in order to illustrate the relationship
between these factors and their contributions to total
return.
For the period ended October 31, 1998, the average
annual total return figures for the Fund for the one,
five and ten-year periods are -.8%, 14.6%, and 14.2%,
respectively.
For the period ended October 31, 1998, the total return
figures for the same periods are -.8%, 97.4%, and
277.1%, respectively.
INDEPENDENT ACCOUNTANT
The Fund's independent accountant,
PricewaterhouseCoopers LLP, 203 North LaSalle Street,
Chicago, Illinois 60601, audits and reports on the
Fund's annual financial statements, reads certain
regulatory reports and the Fund's income tax
statements, and performs other professional accounting,
auditing, tax and advisory services when engaged to do
so by the Fund.
FINANCIAL STATEMENTS
The following audited financial statements of the Fund
are incorporated herein by reference to the Fund's
Annual Report for the fiscal year ended October 31,
1998, as filed with the Securities and Exchange
Commission on or about December 28, 1998:
A. Schedule of Investments as of October 31, 1998
B. Statement of Assets and Liabilities as of October 31, 1998
C. Statement of Operations for the year ended October 31, 1998
D. Statement of Changes in Net Assets for the years
ended October 31, 1998 and 1997
E. Financial Highlights for the fiscal ended October
31, 1998, 1997, 1996, 1995 and 1994
F. Notes to Financial Statements
G. Report of Independent Accountant dated November 19, 1998.
<PAGE>
PART C
OTHER INFORMATION
ITEM 23 Exhibits
(a) Articles of Incorporation of
Registrant*
(b) Bylaws of Registrant*
(c) None
(d) Investment Advisory Agreement with
Sentry Investment Management, Inc. dated
March , 1991*
(e.1) Underwriter Agreement with
Sentry Equity Services, Inc. dated
December 4, 1990*
(e.2) Form of Dealer Agreement*
(f) None
(g) Custodian Agreement with Citibank,
N.A. dated May 1, 1989*
(h.1) Agency Agreement with Sentry
Equity Services, Inc. dated May 14,
1970*
(h.2) Name Agreement with Hardware
Mutual Casualty Company dated May 9,
1969*
(h.3) Agreement between Sentry
Equity Services, Inc. and Hardware
Mutual Casualty Company dated May 14,
1970*
(i) Opinion and Consent of Counsel for
Registrant, dated May 15, 1970*
(j) Consent of PricewaterhouseCoopers
LLP
(k) None
(l) Subscription Agreement executed by
Sentry Life Insurance Company dated July
9, 1969*
(m) None
(n) Financial Data Schedule**
(o) None
* Items (a), (b), (d), (e.1), (e.2), (g), (h.1),
(h.2), (h.3), (i), and (l) are incorporated herein
by reference to such items in Post-Effective
Amendment No. 34 to Registrant's Form N-1A as
filed with the Commission on or about
February 28, 1997.
<PAGE>
** Item (n) is incorporated by reference to such item
in Registrant's Form N-SAR as filed with the
Commission on or about December 28, 1998.
ITEM 24 Persons Controlled by or under Common Control
with Registrant
The following is a description of all persons who might
be considered to be directly or indirectly controlled
by or under common control with the Registrant:
1. Sentry Insurance a Mutual Company ("Sentry
Insurance"), a Wisconsin corporation, is
affiliated with the Registrant, a Maryland
corporation.
2. Sentry Insurance is also affiliated with Sentry
Insurance Foundation, Inc., a Wisconsin
corporation.
3. Sentry Insurance is also affiliated with Sentry
Lloyd's of Texas, a Texas Lloyd's corporation.
4. The following companies are wholly-owned
subsidiaries of Sentry Insurance:
(a) Middlesex Insurance Company
("Middlesex"), a Wisconsin corporation;
(b) Dairyland Insurance Company
("Dairyland"), a Wisconsin corporation;
(c) Sentry Life Insurance Company ("Sentry
Life"), a Wisconsin corporation;
(d) Parker Stevens Agency, Inc., a Wisconsin
corporation;
(e) Parker Stevens Agency of Mass., Inc., a
Massachusetts corporation;
(f) Sentry Investment Management, Inc., a
Delaware corporation, Registrant's Investment
Adviser
(g) Sentry Equity Services, Inc., a Delaware
corporation, Registrant's Underwriter;
(h) Sentry Services, Inc., a Wisconsin
corporation;
(i) Sentry Aviation Services, Inc., a
Wisconsin corporation; and
(j) WAULECO, Inc., a Wisconsin corporation.
5. Patriot General Insurance Company, a Wisconsin
corporation, is a wholly-owned subsidiary of
Middlesex.
6. Sentry Life Insurance Company of New York, a New
York corporation, is a wholly-owned subsidiary of
Sentry Life.
7. Dairyland County Mutual Insurance Company of
Texas, a Texas corporation, is affiliated with
Dairyland.
ITEM 25 Indemnification
The Maryland General Corporation Law, Section 2-418
provides for indemnification of directors, officers,
employees and agents. Officers, directors, employees
and agents of the Fund will be indemnified to the
fullest extent allowed by Maryland law.
Article VII, Section "H" of the Registrant's Articles
of Incorporation provides that the Registrant will
indemnify its directors and officers against expenses,
judgments, fines and settlements reasonably incurred by
them by reason of their offices, provided that such
persons acted in good faith and subject to other
specified conditions. In addition, the same section of
the Articles permits the Registrant to purchase
insurance against certain liabilities of directors and
officers.
In accordance with Section 17(h) of the Investment
Company Act, this provision of the Articles shall not
protect any person against any liability to the
Registrant or its stockholders to which he or she 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 or her
office.
<PAGE>
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
directors, officers, and controlling persons of the
Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer, or
controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in
connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the
question of whether such indemnification by it is
against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
The Registrant participates in an insurance policy
covering the Registrant and the Investment Adviser and
their respective directors, officers, and employees
against certain liabilities arising out of acts,
omissions and breaches of duty in connection with their
offices and employment with such entities. This
insurance policy has limits of $2,500,000 per
occurrence and $10,000,000 in the aggregate.
ITEM 26 Business and Other Connections of the
Investment Adviser
Sentry Investment Management, Inc., the investment
adviser of the Registrant, also acts as investment
adviser to other companies (primarily insurance
companies) affiliated with the adviser.
The following table describes all other business,
professions, vocations and employment of a substantial
nature in which each director or officer of the adviser
is, or has been during the past two fiscal years,
engaged for his or her own account or in the capacity
of director, officer, employee, partner or trustee.
The principal business address for the companies listed
is 1800 North Point Drive, Stevens Point, Wisconsin
54481.
Capacity with
Sentry Investment Substantial Business
Name Management, Inc. and Other Connections
Dale R. Schuh Chairman of the Board Chief Executive Officer and
President of Sentry Insurance
a Mutual Company ("Sentry
Insurance"); Chairman of the
Board of Sentry Fund, Inc.; and
a Director and officer of
various companies in the Sentry
Group
William M. O'Reilly Secretary and Director Vice President, General Counsel
and Corporate Secretary of
Sentry Insurance; Secretary
of Sentry Fund, Inc.; and
a Director and officer of
various companies in the Sentry
Group.
William J. Lohr Treasurer and Director Vice President and Treasurer
of Sentry Insurance; Treasurer
and Director of Sentry Fund, Inc.;
and a Director and officer of
various companies in the Sentry
Group
<PAGE>
ITEM 27 Principal Underwriter
(a) None
(b) The principal business address of each
director and officer of the principal
underwriter is 1800 North Point Drive,
Stevens Point, Wisconsin 54481. Other
required information is as follows:
(1) (2) (3)
Positions and Offices Positions and Offices
Name with Underwriter with Registrant
Susan M. DeBruin President Vice President
Glen E. Scott, Jr. Vice President None
William J. Lohr Treasurer and Director Treasurer and Director
William M. O'Reilly Secretary and Director Secretary
Dale R. Schuh Director (Chairman of the Chairman of the Board
Board)
(c) None.
ITEM 28 Location of Accounts and Records
All accounts, books and other documents are maintained
at the offices of Sentry Equity Services, Inc., 1800
North Point Drive, Stevens Point, Wisconsin 54481.
ITEM 29 Management Services
All management-related service contracts entered into
by Registrant are discussed in Parts A and B of this
Registration Statement.
ITEM 30 Undertakings
The Registrant hereby undertakes to furnish each person
to whom a Prospectus is delivered a copy of the
Registrant's latest Annual Report to Shareholders, upon
request and without charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933 and the Investment Company Act of 1940, the
Registrant has duly caused this Post-Effective
Amendment No. 37 to its Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized in the City of Stevens Point, and State of
Wisconsin, on February 22, 1999.
SENTRY FUND, INC., Registrant
BY: /s/ Susan M. DeBruin
--------------------------------
Susan M. DeBruin, Vice President
Pursuant to the requirements of the Securities Act of
1933, this Post-Effective Amendment No. 37 to the
Registration Statement on Form N-1A has been signed
below by the following persons in the capacities and on
the dates indicated:
Principal Executive Officers and Directors Date
/s/ Dale R. Schuh
- ---------------------------- February 22, 1999
Dale R. Schuh, Director and
Chairman of the Board
(Principal Executive Officer)
/s/ William J. Lohr February 22, 1999
- -----------------------------
William J. Lohr, Treasurer
and Director (Principal Financial
Officer)
/s/ Susan M. DeBruin February 22, 1999
- ------------------------------
Susan M. DeBruin, Vice President
/s/ William M. O'Reilly February 22, 1999
- ------------------------------
William M. O'Reilly, Secretary
- ------------------------------ February __, 1999
David W. Graebel, Director
/s/ Thomas R. Copps February 22, 1999
- ------------------------------
Thomas R. Copps, Director
/s/ Steven J. Umland February 22, 1999
- ------------------------------
Steven J. Umland, Director
<PAGE>
INDEX TO EXHIBITS
Exhibits
(a) Articles of Incorporation of Registrant*
(b) Bylaws of Registrant*
(c) None
(d) Investment Advisory Agreement with Sentry
Investment Management, Inc. dated March 1, 1991*
(e.1) Underwriter Agreement with Sentry Equity
Services, Inc. dated December 4, 1990*
(e.2) Form of Dealer Agreement*
(f) None
(g) Custodian Agreement with Citibank, N.A. dated
May 1, 1989*
(h.1) Agency Agreement with Sentry Equity
Services, Inc. dated May 14, 1970*
(h.2) Name Agreement with Hardware Mutual
Casualty Company dated May 9, 1969*
(h.3) Agreement between Sentry Equity
Services, Inc. and Hardware Mutual Casualty
Company dated May 14, 1970*
(i) Opinion and Consent of Counsel for
Registrant, dated May 15, 1970*
(j) Consent of PricewaterhouseCoopers LLP
(k) None
(l) Subscription Agreement executed by Sentry
Life Insurance Company dated July 9, 1969*
(m) None
(n) Financial Data Schedule**
(o) None
* Items (a), (b), (d), (e.1), (e.2), (g), (h.1), (h.2),
(h.3), (i), and (l) are incorporated herein by
reference to such items in Registrant's Post-Effective
Amendment No. 34 to Form N-1A as filed with the
Commission on or about February 28, 1997.
** Item (n) is incorporated by reference to such item
in Registrant's Form N-SAR as filed with the
Commission on or about December 28, 1998.
PRICEWATERHOUSECOOPERS PricewaterhouseCoopers LLP
203 North LaSalle Street
Chicago, IL 60601-1210
Telephone (312) 701 5500
Facsimile (312) 701 6533
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in
Post-Effective Amendment No. 37 to the
Registration Statement of Sentry Fund, Inc. (the
"Fund") on Form N1-A (File No. 2-34038) of our
report dated November 19, 1998, on our audit of
the financial statements and financial highlights
of the Fund. We also consent to the reference to
our Firm under the captions "Financial Highlights"
in the Prospectus and "Independent Accountant" in
the Statement of Additional Information.
/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
February 25, 1999
