Letter of Transmittal
U.S. Securities and Exchange Commission
Filing Desk
450 5th. St., N.W.
Washington, DC 20549
Re: East End Mutual Funds, Inc.
CIK No. 0000920261
File Nos. 811-8408
Commissioners:
Filed herewith on EDGAR in accordance with the provisions of Regulation S-T
is post Effective Amendment No. 5 to the captioned Funds's Registration
Statement on Form N1-A. Changes have been marked in accordance with
Regulation 310, the Articles of Incorporation, By-Laws and Investment
Management agreement are incorporated by reference.
Very Truly Yours
/s/ Aristides M.Matsis, President
EAST END MUTUAL FUNDS,INC.
POST EFFECTIVE AMENDMENT
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON 9/13/00
FILE NO: 811-8408
SECURITIES AND EXCHANGE COMMISSION
Washington,D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
Post-Effective Amendment No. /_5_/
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY /X/
ACT OF 1940
Amendment No. 4
EAST END MUTUAL FUNDS, INC.
(Exact name of Registrant as Specified in Charter)
736 West End Avenue, Suite 3A
New York, New York 10025-6245
(Address of Principal Executive Office)
Registrant's Telephone Number, including Area Code:
212-666-0289
ARISTIDES M. MATSIS, 736 WEST END AVENUE, SUITE 3A
NEW YORK, NEW YORK 10025
(Name and Address of Agent for Service)
(Please send a copy of communications to:)
Aristides M.Matsis
736 West End Avenue, Ste. 3A
New York, New York 10025
212-666-0289
ANNUAL REGISTRATION STATEMENT PURSUANT TO RULE 485
It is proposed that this filing will become effective
immediately upon filing.
A Rule 24f-2 Notice for the year ended June 30, 2000 was
filed on September 13, 2000
FORM N-1A
CROSS REFERENCE SHEET
Form N-1A Part A
ITEM NO. PROSPECTUS LOCATION
1. Cover Page . . Cover Page
2. Synopsis . . . Shareholder Transaction Expenses
3. Condensed Financial Information . . Per Share Table
4. General Description of Registrant . .
Investment Objective of the
Fund; Investment Policies of
the Fund; Other Investment
Policies; Investment Risks;
Who Should Invest; General
Information; Dividends and
Distributions; Taxation
5. Management of the Fund . . . .
Management's Experience;
How the Fund is Managed;
Fund Service Providers
5A. Management Discussion of Fund Performance
6. Capital Stock and Other Securities . General Information
7. Purchase of Securities Being Offered . .
How to Invest in the Fund;
How Net Asset Value is Determined
Plan of Distribution;
8. Redemption or Repurchase
How to Sell (Redeem) Your Shares
FORM N-1A PART B
LOCATION IN STATEMENT OF ADDITIONAL INFORMATION
ITEM NO.
9. Pending Legal Proceedings . . . None
10. Cover Page . . . Cover Page
11. Table of Contents . . Table of Contents
12. General Information The Company;
Description of Predecessor Company
Independent Auditors
13. Investment Objectives Investment Objective .
. . Policies; Investment
Restrictions
14. Management of the Fund . . Investment Manager;
Directors and Officers
15. Control Persons and Principal Holders of Securities
.
16. Investment Advisory The Investment Manager
Independent Auditors
See item "Fund Service Providers"
in Prospectus
17. Brokerage Allocation Execution of Portfolio Transactions
18. Capital Stock and Other Securities
See "General Information"
in Prospectus
19. Purchase, Redemption and Pricing of Securities Being Offered
Additional Purchase and
Redemption Information
.Distribution Plan
20. Tax Status . Tax Information
Tax Distributions of Dividends
21. Underwriters . Not Applicable
22. Calculations of Performance Data
Measuring Performance
23. Financial Statements Independent Auditors' Report;
As of June 30, 2000
Schedule of Investments Statement of
Asset and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Financial Highlights
Notes to Financial Statement
PART C OTHER INFORMATION
24. Financial Statements and Exhibits
(a) Financial Statements as of June 30, 2000
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Financial Highlights
(b) Exhibits
Exhibit No.
(1) copies of the Charter as now in effect; 2*
(2) Articles of Incorporation 1*
agreement with respect to
more than 5 percent of any
class of equity securities
of the Registrant;
None
(3) Copies of any voting trust
None
(4) copies of all instruments Article VI
defining the rights of holders of the
Securities Section (e)
registered including where applicable, the
relevant portion of the Articles of
Incorporation or bylaws of the
Registrant;
(5) copies of all investment
advisory contracts relating to
the management of the assets
of the Registrant;
Form of Investment Management 5*
Agreement between East End
Mutual Funds, Inc. with
respect to The Capital
Appreciation Series and East
End Investment Management Company;
(6) copies of each underwriting or 16*****
distribution contract between
the Registrant and a principal
underwriter, and specimens or
copies of all agreements between
principal underwriters and dealers;
(7) copies of all bonus, profit sharing,
pension or other similar arrangements
wholly or partly for the benefit of directors or
officers of the Registrant in
their capacity as such; any such
plan that is not set forth in a
formal document, furnish a
reasonably detailed description thereof;
none
(8) copies of all custodian
agreements and depository
contracts under Section 17(f)
of the 1940 Act with respect
to securities and similar
investments of the Registrant,
including the schedule of remuneration;
Form of Custodian Agreement 8***
between East End Mutual Funds,
Inc. and The Provident Bank;
(9) copies of all other material contracts
not made in the ordinary course
of business which are to be
performed in whole or in part at
or after the date of the filing of
the Registration Statement;
(a) Transfer Agency and Service 9(a)***
Agreement between East End
Mutual Funds, Inc. and
East End Investment Management
Company;
(b) Pricing of Portfolio 9(b)***
Agreement between East End
Mutual Funds,Inc.and East End
Investment Management Company;
(c) Administration Agreement for 9(c)***
Reporting and Accounting
Services between East End Mutual
Funds, Inc. and East End
Investment Management Company.
(10) an opinion and consent of counsel 10****
as to the legality of the securities
being registered, indicating whether
they will, when sold, be legally
issued, fully paid and non-assessable;
(11) copies of any other opinions,
appraisals or rulings and consents
to use thereof relied on in the
preparation of this Registration
Statement and required by Section 7
of the 1933 Act.
(a) Independent Auditors Report 11(a)*****
(b) Consent of Independent Public 11(b)*****
Accountants
(12) all financial statements None
omitted from Item 23;
(13) copies of any agreements or None
understandings made in
consideration for providing the
initial capital between or among
the Registrant, the underwriter,
adviser, promoter, or initial
stockholders and written assurances
from promoters or initial shareholders
that their purchases were made for
investment purposes without any
present intention of redeeming or
reselling;
(14) copies of the model plan used in the
establishment of any retirement plan
in conjunction with which Registrant
offers its securities, any instructions
thereto and any other documents making
up the model plan. Such form(s) should
disclose the costs and fees charged in
connection therewith;
Master Retirement Plan 14(a)***
Master Retirement Plan - Profit Sharing
Adoption Agreement 14(b)***
Master Retirement Plan - Money Purchase
Adoption Agreement 14(c)***
Simplified Employee Pension Plan
Adoption Agreement 14(d)***
Self Directed Individual Retirement
Account 14(e)***
Standardized Paired Profit Sharing
Plan with Trust Agreement 14(f)***
(15) copies of any plan entered into
by Registrant pursuant to Rule 12b-1
under the 1940 Act, which describes
all material aspects of the
financing of distribution of
Registrant's shares, and any agreements
with any person relating to implement-
ation of such Plan;
Form of Plan of Distribution 15(a)**
to be adopted by East End Mutual
Funds, Inc. with respect to the
Capital Appreciation Series; (b)(ii)***
Form of Agreement Pursuant to 15(b)***
Plan of Distribution between
East End Mutual Funds, Inc. with
respect to the Capital Appreciation
Series and East End Investment
Management Company;
Form of Selling Agreement 15(b)(ii)*****
(16) Schedule for computation 16*****
of each performance quotation
provided in the Registration
Statement in response to Item 22
(which need not be audited);
* These Exhibits were filed with Registration Statement 6/02/94
** This Exhibit was filed with Pre-Effective Amendment No.2 - 9/14/94
*** This Exhibit was filed with Pre-Effective Amendment No.3 - 1/25/95
**** This Exhibit was filed with Post-Effective Amendment No.5 - 9/13/00
***** This Exhibit was filed with Post-Effective Amendment No.5 - 9/13/00
(25) Persons Controlled by or Under Common Control
With Registrant
See Caption "Control Persons and Principal
Holders of Securities" in the
Statement of Additional Information
(26) Number of Holders of Securities
(a) Title of Class
Common Capital Stock, $.001 par value
(b) Number of Record Holders
(27). Indemnification
(a) General. The Articles of Incorporation
(the "Articles") of the Corporation provide
that to the fullest extent permitted by
Maryland statutory and decisional law
and the Investment Company Act
of 1940, no director or officers of the
Corporation shall be personally
liable to the Corporation or its
shareholders for money damages.
The Articles further provide that the
Corporation shall indemnify;
(1) its directors and officers, whether serving the
corporation, or at its request, any other entity,
to the full extent permitted or required by the
general laws of the State of Maryland now or
hereafter in force, including the advancing of
expenses under the procedures and to the full
extent permitted by law, and
(2) its other employees and agents, to such extent
as shall be authorized by the Board of Directors,
the Corporation's By-Laws and permitted by law.
The foregoing rights indemnification are not
exclusive of any other rights to which those
seeking indemnification may be entitled. The
Board of Directors may take such action as is
necessary to carry out the indemnification
provisions and is expressly empowered to adopt,
approve, and amend,from time to time, such By-Laws,
resolutions or contracts implementing such
provisions or such further indemnification
arrangements as may be permitted by law.
The Articles further provide that no amendment
of the Articles of Incorporation shall limit or
eliminate the right to indemnification provided,
with respect to acts or omissions occurring prior
to such amendment. Nothing contained in the
Articles shall be construed to authorize the
Corporation to indemnify any officer or director
of the Corporation against any liability to the
Corporation or to any holders of securities of
the Corporation to which he or she is subject
by reason of willful malfeasance, bad faith,gross
negligence, or reckless disregard of the duties
involved in the conduct of his or her office. Any
indemnification by the Corporation shall be
consistent with the requirements of law, including
the Investment Company Act of 1940.
The By-Laws of the Corporation provide that the
Corporation shall indemnify any individual who is a
present or former director or officer of the
Corporation and who, by reason of his or her position
was, is or is threatened to be made a party to any
threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative
or investigative (hereinafter collectively referred
to as a "Proceeding") against judgments, penalties,
fines, settlements and reasonable expenses actually
incurred by such director or officer in connection
with such Proceeding, to the fullest extent that such
indemnification may be lawful under Maryland law.
(b) Disabling Conduct. The By-Laws provide that
nothing therein shall be deemed to protect any
director or officer against any liability to the
Corporation or its shareholders to which such
director or officer 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 (such
conduct hereinafter referred to as "Disabling Conduct"
The By-Laws provide that no indemnification of
a director or officer may be made unless: (1) there
is a final decision on the merits by a court or
other body before whom the Proceeding was brought
that the director or officer to be indemnified was not
liable by reason of Disabling Conduct; or (2) in
the absence of such a decision, there is a reasonable
determination, based upon a review of the facts, that
the director or officer to be indemnified was not
liable by reason of Disabling Conduct, which determin-
ation shall be made by: (i) the vote of a majority of a
quorum of directors who are neither "interested persons"
of the Corporation as defined in Section 2(a)(19) of
the Investment Company Act of 1940, nor parties to the
Proceeding; or (ii) an independent legal counsel in a
written opinion.
(c) Standard of Conduct. Under Maryland law, the Corporation
may not indemnify any director if it is proved that:
(1) the act or omission of the director was material to the
cause of action adjudicated in the Proceeding and (i)
was committed in bad faith or (ii) was the result of
active and deliberate dishonesty; or (2) the director
actually received an improper personal benefit; or
(3) in the case of a criminal proceeding, the director had
reasonable cause to believe that the act or omission was
unlawful. No indemnification may be made under Maryland
law unless authorized for a specific proceeding after a
determination has been made, in accordance with Maryland
law, that indemnification is permissible in the circum-
stances because the requisite standard of conduct has
been met.
(d) Required Indemnification. Maryland law requires that a
director or officer who is successful, on the merits or
otherwise, in the defense of any Proceeding shall be
indemnified against reasonable expenses incurred by the
director or officer in connection with the Proceeding.
In addition, under Maryland law, a court of appropriate
jurisdiction may order indemnification under certain cir-
cumstances.
(e) Advance Payment. The By-Laws provide that the Corporation
may pay any reasonable expenses so incurred by any director
or officer in defending a Proceeding in advance of the
final disposition thereof to the fullest extent permissible
under Maryland law. In accordance with the By-Laws, such
advance payment of expenses shall be made only upon the
undertaking by such director or officer to repay the
advance unless it is ultimately determined that such
director or officer is entitled to indemnification, and
only if one of the following conditions is met:
(1) the director or officer to be indemnified provides a
security for his undertaking;
(2) the Corporation shall be insured against losses arising
by reason of any lawful advances; or
(3) there is a determination, based on a review of
readily available facts, that there is reason to believe
that the director or officer to be indemnified ultimately
will be entitled to indemnification which determination
shall be made by:
(i) a majority of a quorum of directors who are neither
"interested persons" of the Corporation, as defined in
Section 2(a)(19) of the Investment Company Act of 1940,
nor parties to the Proceeding; or (ii) an independent
legal counsel in a written opinion.
(f) Insurance. The By-Laws provide that, to the fullest
extent permitted by Maryland law and Section 17(h) of the
Investment Company Act of 1940, the Corporation may
purchase and maintain insurance on behalf of any officer
or director of the Corporation, against any liability
asserted against him or her and incurred by him or her in
and arising out of his or her position, whether or not the
Corporation would have the power to indemnify him or her
against such liability.
(g) Public Policy Presumption under the Securities Act of 1933
and Undertaking Pursuant to Rule 484(b)(1) under the 1933
Act. 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 Registrant's By-Laws or other-
wise, the Registrant has been advised that, in the opinion
of the Securities and Exchange Commission, such indemni-
fication 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
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 a controlling precedent, submit to a court of
appropriate jurisdiction the question of whether indemni-
fication by it is against public policy as expressed in
the Act and will be governed by the final adjudication
of such issue.
(28) Business and Other Connections of Investment Adviser
Aristides M.Matsis has been managing trusts, pension plans
and private accounts in connection therewith has been
investing and reinvesting the these assets.
(29) Principal Underwriter
The Fund does not have a principal underwriter
(30) Location of Accounts and Records
The books and records of the Fund, are maintained at East
End Investment Management Company, 736 West End Avenue,
Suite 3A, New York, NY 10025.
(31) Management Services
There are no management service contracts not
described in Part A or Part B of this Form N-1A
(32) Undertakings
(a) Registrant agrees that the Directors of East End
Mutual, Funds, Inc. will promptly call a meeting of
shareholders for the purpose of acting upon questions
of removal of a director or directors, when requested
in writing to do so by the record holders of not less
than 10% of the outstanding shares.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the use of our report, dated August 2, 2000 , in the
annual financial statements and financial highlights of the East End
Mutual Funds, Inc. - Capital Appreciation Series, which is included
in Part A and Part B in Post Effective Amendment No. 5 to
Registration Statement No. 4 under the Securities Act of 1933 and
included in the Prospectus and Statement of Additional Information,
as specified, and to the reference made to us under the caption
"Independent Auditors" in the Statement of Additional Information.
August 2, 2000
Abington Pennsylvania
Sanville & Company
Certified Public Accountants
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 Registration to the Statement to be signed on its
behalf by the undersigned, hereunto duly authorized in New York,
New York, on the 13th. day of September, 2000.
EAST END MUTUAL FUNDS, INC.
By: /s/ Aristides Matsis, President
PROSPECTUS
OF
EAST END MUTUAL FUNDS, INC.
CAPITAL APPRECIATION SERIES
The East End Mutual Funds, Inc. Capital Appreciation Series (the "Fund")
is a series of East End Mutual Funds, Inc.(the "Company"), an open-end,
diversified, management investment company registered as such under the
Investment Company Act of 1940. The Company may, from time to time,
issue additional series, which will have different investment objectives
from those of the Fund. This Prospectus sets forth basic information about the
Fund that prospective investors should know before investing. It should be read
and retained for future reference. A Statement of Additional Information,
dated September 13, 2000, has been filed with the U.S. Securities and Exchange
Commission and is incorporated in its entirety by reference and is available,
without charge, upon written request to the Fund at East End Mutual Funds,
Inc., 736 West End Avenue, Ste. 3A, New York, New York 10025, by calling
1 877 309-6565 or downloading it from our website at WWW.EASTEND-MUTUALFUNDS.
COM
As with all mutual funds the Securities and Exchange Commission has not
approved or disapproved these securities or passed on the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
Prospectus dated: September 13, 2000
This document shall not be an offer to sell or a solicitation of or an offer
to buy nor shall there be any sale of these securities in any state in which
such offer, solicitation or sale would be unlawful prior to qualification
under the securities law of any such state.
TABLE OF CONTENTS
PAGE
Shareholder Transaction Expenses................................. 3
Costs ........................................................... 3
Financial Highlights............................................. 4
Risk Return Chart and Table...................................... 5
Investment Objective of the Fund................................. 5
Investment Policies of the Fund.................................. 6
Other Investment Policies and their Risks........................ 7
Investment Risks................................................. 8
Portfolio Turnover............................................... 10
Who Should Invest................................................ 10
How the Fund is Managed.......................................... 11
Brokerage Allocation............................................. 12
Fund Service Providers........................................... 12
How to Invest in the Fund........................................ 13
How Net Asset Value is Determined................................ 14
Plan of Distribution............................................. 15
How to Sell (Redeem) Your Shares................................. 15
General Information.............................................. 17
Dividends and Distributions...................................... 17
Taxation......................................................... 18
This table describes the fees and expenses that you may
pay if you buy and hold Shares of the Fund.
Maximum Sales Load Imposed on Purchases.......................... None
Maximum Sales Load Imposed on Reinvested Dividends............... None
Deferred Sales Load.............................................. None
Redemption Fees.................................................. None
Exchange Fee..................................................... None
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fees................................................. 1.00%
12b-1 Fees...................................................... .00
Other Expenses.................................................. .87
Total Fund Operating Expenses................................... 1.87%
(1) Although not contractually obligated to do so, the Manager
waived certain amounts during the past fiscal year. The Fund
paid for the fiscal year ended June 30, 2000, 1.80% in expenses.
The purpose of this table is to assist you in understanding the
various costs and expenses that you would bear, directly or
indirectly, as an investor of the Fund.
EXAMPLE
The following Example is intended to help you compare the cost of
investing in Shares of the Fund with the cost of investing in
other mutual funds. The example assumes that you invest $10,000
in the Fund's shares 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 operating expenses are as shown in the Table
and remain the same.Although your actual costs may be higher or
lower, based on these assumptions your costs would be:
1 Year $189 3 Years $585 5 Years $1,006 10 years $2,167
This example should not be considered a representation of past or
future expenses or performance. Actual expenses and performance
may be higher or lower than those shown.
FINANCIAL HIGHLIGHTS
EAST END MUTUAL FUNDS, INC. - CAPITAL APPRECIATION SERIES
Selected Data for a Share of Stock
Throughout each Period
Oct 2,1995
Year Ended June 30, to
2000 1999 1998 1997 1996
PER SHARE OPERATING PERFORMANCE
Net Asset Value Beginning of Period ($) 10.160 9.500 10.340 13.730 10.480
INCOME FROM INVESTMENT OPERATIONS:
Net Investment Loss (0.018) (0.130) (0.290) (0.370) (0.007)
NET REALIZED AND UNREALIZED GAIN
OR (LOSS) ON INVESTMENTS 10.858 0.790 (0.550) (2.083) 3.335
TOTAL FROM INVESTMENT OPERATIONS 10.840 0.660 (0.840) (2.453) 3.328
LESS DISTRIBUTIONS:
Distributions from Net Realized Gain 0.937 0.078
TOTAL DISTRIBUTIONS 0.937 0.078
NET ASSET VALUE END OF PERIOD ($) 21.000 10.160 9.500 10.340 13.730
TOTAL RETURN (%) 106.693 6.947 (8.124)(17.870) 31.760
RATIOS/SUPPLEMENTAL DATA:
Ratio of Expenses to Average
Net Assets (%)* 1.801 2.668 3.057 4.840 2.770
Average Net Assets (%) * (1.488) (1.411) (2.658) (3.670) (0.910)
Portfolio Turnover Rate (%) 42.139 77.364 86.840 26.980 65.810
Net Assets, End of Period ($) 462,224 224,490 209,872 235,139 284,414
* annualized
The accompanying notes are an integral part of these financial statements
The bar chart shows variability of the Fund's shares as a
percent change of net asset value on a fiscal year
basis. During the 4 3/4 year period shown in the bar
chart, the highest return for a 12 month period was
106.69% for the last fiscal year ending June 30, 2000 and
the lowest return was -17.87% for the 12 month period
ending June 30,1997.
RISK RETURN TABLE
<TABLE>
<S> <C> <C>
Average Annual Total Returns
For the periods ending Past Year Past 4 3/4 Years
June 30, 2000 10/95 to 6/00
East End Capital
Appreciation 125.21 % 26.36 %
Standard & Poor's 600 Index
12.70 % 16.92 %
Russell 2000 Index
16.20 % 15.03 %
S & P 600 is the Standard & Poor's composite Index of 600 Stocks, and the
Russell 2000 are widely recognized unmanged index's of common stock prices
dividends and distributions are included, expenses have not since Index's
have none.
The Fund's total return over its last fiscal year ending June 30,2000
relative to the Standard and Poor's 600 and Russell 2000 both are broad
based unmanaged market index's with similar investment objectives as
the Fund were as follows: the Fund's fiscal one year return was 125.21%,
the Standard and Poor's 600 Index was 12.70% and the Russell 2000 16.20%.
Past performance may not necessarily predict future performance. This
information provides you with historical performance information so
that you can analyze whether the Fund's investment risks are balanced by
its potential rewards.
PRINCIPAL RISKS OF THE FUND
There are risks common to all mutual funds. The following is a
summary description of these risk factors. A complete description of the
risks can be found in "Principal Risks of Investing in the Fund". For
example a fund's share price may decline and an investor could lose
money if his cost was above his sale price. Also there is no assurance
that a fund will achieve its investment objective. An investment in
the Fund does not necessarily constitute a balanced investment
program for any one investor. The risk posed by the fact that the :
(1) value of equity securities rise and fall, (2) smaller market
capitalization companies tend to have fewer share holders, less liquid-
ity, more volatility, unproven business records, limited product or
service base and limited access to capital and (3) foreign economic,
political or regulatory conditions may be less favorable than those of
the United States.
INVESTMENT OBJECTIVE OF THE FUND
The investment objective of the Fund is to provide capital appreciation.
Income is a secondary objective. While current income will be
considered in making Fund investments, it will be of secondary importance.
The Fund's investment objective may not be changed without shareholder
approval. No assurance can be given that the Fund will attain its objective
Investors may wish to reduce the potential risk of investing in the Fund by
purchasing shares on a regular, periodic basis (dollar cost averaging)
rather than making an investment in one lump sum.
INVESTMENT POLICES OF THE FUND
The East End Investment Management Company, the Fund's Manager
(hereafter sometimes the "Manager") seeks capital growth and secondarily
income by investing the Fund's assets principally in the common stock of
companies which, in the Manager's judgment, are exhibiting and are expected
to continue achieving above average growth in share appreciation. The
management of those companies selected will have plans to introduce
or will have introduced new products, services or marketing innovations
that are unique and perceived as needed in the marketplace. However, there
is always the risk that the new products or services that are introduced
will not be well received or a marketing innovation will be unsuccess-
ful.
The Manager generally expects the companies selected to gain market
share within their industry, to maintain yearly gains in sales growth.
Two major elements of the disciplined selection process are (1) above
average earnings growth and (2) better than average relative price
performance of the company's stock. Both fundamental and technical market
research are used to locate emerging new potential leaders in an industry.
The Fund may invest in securities traded on the New York Stock Exchange,
NASDAQ, the American Stock Exchange and in the over-the-counter market.
When the Manager perceives that the relative risks and rewards of holding
equities are less than for debt instruments, as for example when the
risk of holding U.S. Treasury bonds is offset by the probable rewards of
falling long-term interest rates or when equities are deemed to be over-
valued., the investment manager may invest in obligations of the U.S.
Government, its agencies and instrumentalities, obligations of foreign
governments and corporate bonds with investment grade ratings by
Standard & Poor's Corporation ("Standard & Poor's"). Up to 50% of
the Fund's assets may be invested in the debt instruments described.
Obligations of certain agencies and instrumentalities of the U.S.
Government, such as those of Government National Mortgage Association,
are supported by the full faith and credit of the U.S.Treasury; others,
such as the Export-Import Bank of the United States, are supported
by the right of the issuer to borrow from the Treasury; others, such as
those of the Federal National Mortgage Association, are supported by the
discretionary authority of the U.S. Government to purchase the agency's
obligations; still others, such as those of the Student Loan Marketing
Association, are supported only by the credit of the instrumentality.
No assurance can be given that the U.S. Government would provide
financial support to U.S. Government sponsored instrumentalities, if
it is not obligated to do so by law.
The Manager may also invest up to 10% of the Fund's portfolio in a
diversified group of high yielding, below investment grade corporate
debt securities. No investments will be made in securities that are
rated below BBB by Standard & Poor's nor in un-rated securities. Securities
rated less than BBB by Standard & Poor's are classified as non-investment
grade debt securities or "junk bonds". These securities generally have a
higher yield but also present higher risks than investment grade bonds.
The risks include higher likelihood of default by the issuer, greater price
volatility, difficulty in disposing of or valuing the securities under
certain market conditions, and the possible adverse effects of economic
recession, interest rate increases and changes in public perceptions of
the market for these investments. These securities are predominantly
speculative. Such securities are considered as speculative by the major
credit rating agencies.
Purposes Investing for Defensive
During periods when the Manager deems it advisable for the Fund's portfolio
to be more conservatively positioned as when significant adverse market
or economic circumstances require immediate action to avoid losses,
the investment adviser will invest in short-term liquid and high-grade
debt securities that present minimal credit and interest rate risk.
Such investments will include bank obligations, commercial paper (which
are unissued promissory notes issued by corporations) and obligations
issued or guaranteed by the United States Government, its agencies or
instrumentalities or by foreign governments.
Bank obligations include U.S. dollar-denominated certificates of deposit,
bankers' acceptances and short-term time deposits, issued or supported
by the credit of United States Government or issued or supported by the
credit of a foreign government.
Commercial paper purchased by the Fund may include, in addition to that
issued by U.S. corporations, obligations issued by Canadian corporations
and Canadian counterparts of U.S. corporations and Euro-paper, which is U.S.
dollar-denominated commercial paper of a foreign issuer.
The investment policies of the Fund are, as described above,not fundamental
and may be changed without shareholder approval.
OTHER INVESTMENT POLICIES AND THEIR RISKS
The Fund may also engage, subject to the limitations set forth, in the
following investment practices, each of which may involve certain
risks. See "Risk Factors", p._7__. Percentage investment limitations will
be considered only at the time of investment. The Statement of Additional
Information contains more detailed information about some of these
investment practices, including limitations designed to reduce risk.
The following investment policies may be changed without shareholder
approval.
Lending Portfolio Securities
The Fund may lend its investment securities constituting up to 25% of
its total assets to qualified institutional investors for the purpose of
realizing additional income. A loan of portfolio securities may be either
short-term (less than nine months) or long-term. The risk of lending port-
folio securities consists of possible delays in receiving the securities
or possible loss of rights in the collateral should the borrower fail
financially. Loans of securities by the Fund will be collateralized by
cash, letters of credit, or securities issued or guaranteed by the U.S.
Government or its agencies. The collateral will equal, at all times,
at least 100% of the current market value of the loaned securities. The
Fund will have the right to obtain the return of the loaned securities on
five-days notice.
"WHEN-ISSUED" SECURITIES
The Fund may occasionally purchase securities on a "when-issued" basis,
for payment and delivery at a future date, typically 15 to 45 days after
the commitment to purchase. It is anticipated that such "when-issued"
securities will principally be equity securities. The price is generally
fixed on the date of commitment to purchase and the value of the
security is thereafter reflected in the Fund's net asset value. At the
time of settlement, the market value of the security may be more or less
than the purchase price. When the Fund purchases "when issued" securities,
a segregated account will be established and maintained with the Fund's
custodian in an amount equal, at least, to the when-issued commitments
consisting of cash or high-quality liquid debt instruments.
Warrants
The Fund also may invest up to 5% of its net assets in warrants. A reason
for investing in warrants is to permit the Fund to participate in
an anticipated increase in the market value of a security without having
to purchase the security to which the warrants relate. Warrants convey
no rights to dividends or voting rights, but only an option to purchase
equity securities of the issuer at a fixed price. If such securities
appreciate,the warrants may be exercised and sold at again, but a loss will
be incurred if such securities decrease in value or the term of the
warrant expires before it is exercised. The 5% limitation does not include
warrants acquired by the Fund in units or attached to other securities.
FOREIGN INVESTMENTS
The purchase of foreign securities allows the Manager the flexibility
to invest globally when the U.S. market lacks sufficient investment
opportunities. The securities of certain foreign issuers are listed
directly on one or more national securities exchanges or on NASDAQ. These
securities may be bought and sold in the same manner as the securities
of U.S. issuers traded there. The securities of other foreign issuers are
represented by American Depository Receipts ("ADRs"). ADRs are certificates
issued by a U.S. depository bank or trust company and represent the
right to receive securities of a foreign issuer deposited with such
depository bank or a non-U.S. branch of such depository bank. ADRs are
traded on one or more national security exchanges, on NASDAQ or in the over
the counter market. Investment in ADRs has certain advantages over direct
investment in foreign securities traded in foreign markets as for example:
(i) ADR's are U.S. dollar denominated investments which are easily
transferable and for which market quotations are readily available; and
(ii) Issuers whose securities are represented by ADRs are subject to
the same auditing, accounting and financial reporting standards as domestic
issuers. Fee structures differ widely among ADRs. The depository bank
charges an issuance fee when an ADR is created and a similar charge,
called a cancellation fee, is levied when the underlying shares are sold
back into the local market. Certain depository banks charge fees other
than the issuance and cancellation fees, for example, dividend fees and
rights issuance fees as well. ADRs may be sponsored by the issuing
depository bank or un-sponsored. Un-sponsored ADRs are riskier. The
information available about them may not be current or may be
incomplete, they are less liquid and since most of them are traded in
the over-the-counter market, the spread between the bid and asked prices
are wider, meaning higher transaction costs. The Fund may invest up to 25%
of net assets in U.S. dollar denominated American Depository Receipts,
both sponsored and un-sponsored. Foreign investments may be affected
favorably or unfavorably by changes in currency exchange rates and
by currency control regulations. There may be less publicly available
information about a foreign company than about a U.S. company. Securities
of some foreign companies are less liquid or more volatile than securities
of U.S. companies. Investments in foreign securities can involve other
risks different from those affecting U.S. investments, including local
political and economic developments, expropriation and nationalization of
assets and imposition of withholding taxes on dividends or interest
payments.
Closed-End Investment Companies
The Fund may also invest up to 10% of its total assets in shares of
closed-end investment companies that invest in the securities of issuers
located in particular countries. Shares of certain closed-end investment
companies may at times be acquired only at market prices representing
premiums to their net asset values. If the Fund acquires shares of closed
end investment companies, shareholders would bear both their proportionate
share of expenses of the Fund (including management and advisory fees)
and, indirectly, the expenses of such closed-end investment companies.
PORTFOLIO TURNOVER
Although investments are generally made for the long term, the Manager
retains the right to trade securities actively for short-term trading
profits, irrespective of how long they have been held, if the objective
of the Fund would be better served. The annual portfolio turnover of the
Fund for the fiscal year June 30,2000 was 42.139%. A turnover rate of 100%
would occur, for example, if the value of all of the securities held in the
Fund's portfolio were replaced within a one-year period. A high turnover
rate involves correspondingly higher brokerage commission expenses which
would have to be borne directly by a fund. It may also affect the
character of capital gains, if any, realized and distributed by a fund
since short-term capital gains are taxable as ordinary income.
The Fund is subject to certain types of risks. It is subject to the risks
of the securities markets in which the portfolio securities of the Fund
are traded. Securities markets are cyclical the prices of the securities
traded in such markets rise and fall at various times. These cyclical
periods may extend over significant periods of time. The Fund is also
subject to the risk that the Manager will not be successful in managing
the Fund's portfolio at times. The Manager will make decisions on
buying, selling or holding portfolio securities based upon the skills
of the Manager in interpreting the available economic, financial and market
data.
Investors should also be aware that certain of the investment policies
of the Fund described above under Other Investment Policies may be deemed
aggressive and will entail greater than average risk to the extent such
policies are implemented. Risks associated with such policies are set
forth above under the descriptions for such policies. Certain fundamental
investment restrictions which are described in the Statement of Additional
Information have been adopted with respect to the Fund. These restrictions
are deemed to be fundamental and may not be changed without shareholder
approval.
WHO SHOULD INVEST
The Fund is intended for investors who are seeking growth of capital
and income. Although the Fund's Manager may consider current income when
making Fund portfolio investments, it is of secondary importance. Investors
should not consider the Fund a substitute for fixed income investments.
HOW THE FUND IS MANAGED
The business affairs of the Fund are managed under the general super-
vision of the Company's Board of Directors. The Company's officers, its
employees and the Manager are responsible for the day-to-day operations
of the Fund. East End Investment Management Company, 736 West End Avenue,
Suite 3A, New York, NY 10025 (the "Manager") serves as the Fund's invest-
ment manager. The Manager does not provide investment management services
to any other mutual funds. Under the terms of the Investment Management
Agreement, the Manager, for the fee described below, manages the investment
and reinvestment of the assets contained in the Fund's portfolio and
continuously reviews, supervises and administers the Fund's investment
program. The Manager is subject to the authority of the Company's Board of
Directors.
Aristides M. Matsis is responsible for the day-to-day management of the
Fund's portfolio also president, treasurer and a director of the Fund and
the Manager. Mr. Aristides M. Matsis is a private investor in stocks, bonds
and real estate for the past thirty five years. Since 1993, He has been
continuously registered with the U.S. Securities and Exchange Commission
as an investment advisor and has managed a series of private investment
trusts with similar investment objectives as the Fund since 1987 and the
assets of the Fund since 1995.
The Manager will receive a fee, payable monthly, for the performance of its
services at an annual rate of 1% on the first $500 million of the average
net assets of the Fund and 3/4 of 1% on average net assets in excess of
$500 million. The fee will be accrued daily at the rate of 1/365 of 1% for
the purpose of determining the offering and redemption price of the Fund's
shares. The Fund shall bear all of its expenses and all expenses of the
Fund's organization, operation and business not specifically assumed or
agreed to be paid by the Manager. The Manager will pay or provide for
the payment of the cost of such office space, office equipment and office
services as are adequate for the Fund's needs; provide competent personnel
to perform all of the Fund's executive, administrative and clerical
functions not performed by Company employees or agents on behalf of the
Fund; and authorize persons who are officers, directors and employees of
the Manager who may be designated as directors, officers, and committee
members of the Company to serve in such capacities at no cost to the
Company or the Fund.
The Fund pays all of its other costs and expenses including, among
others, interest; taxes; fees and expenses of directors who are non-
interested persons; administrative and distribution expenses related
directly to the issuance and redemption of Fund shares; expenses of report-
ing or qualifying shares for sale; charges of custodians and transfer
and other agents; costs of preparing, printing and mailing reports and
notices to shareholders; charges for legal and auditing services, and other
fees and expenses of every kind not expressly assumed by the Manager.
See the Statement of Additional Information for a detailed listing of
such costs and expenses.
The Manager may elect, from time to time, to defer the receipt of some
part or all of its management fee or advance money for expenses in
order to keep the Fund's annual operating expenses at or below the 2%
of average net assets. Any management fee or portion thereof thus deferred
and expenses advanced will be subject to recoupment by the Manager
and reimbursement by the Fund, at any time within the three years following
the deferral or advancement; provided, the Fund is able to make such
reimbursement and further provided, that such payment would not adversely
affect the Fund's tax status or have any other adverse tax impact on the
Fund or its shareholders. Any deferrals will be shown on the Fund's
books as a contingent liability until such time as it is extinguished or
expires. The liability of the Fund to make such reimbursement which, as
noted, is a contingent liability, takes place at the time the advancement
or deferral of expenses occurs.
BROKERAGE ALLOCATION
The Investment Management Agreement authorizes the Manager to select
brokers and dealers for the placing of brokerage orders. In placing
brokerage orders, the Manager will use its best efforts to obtain the most
favorable prices and executions. The determination of what may constitute
the most favorable price and execution in a brokerage order involves a
number of factors, including the overall direct net economic result to the
Fund (involving both price paid or received, and any commissions or other
costs paid), and the efficiency with which the transaction is effected.
The sale of Fund shares may be considered when determining the firms
which are to execute brokerage transactions for the Fund. The Manager is
authorized to pay a brokerage commission in excess of that which another
broker might have charged for effecting the same transaction, in recogni-
tion of the value of brokerage and research services provided by the
broker.
Investment decisions for the Fund will be made independently from those
for other accounts that may be managed, from time to time, by the Manager.
Investments for such other accounts may also be made in the same securities
as the Fund. When a purchase or sale of the same security is made
contemporaneously on behalf of the Fund and another account, available
investments or opportunities for sales will be executed in a manner which
the Manager deems to be equitable. In some instances, this procedure may
affect the price paid or received by the Fund or the size of the investment
position obtained or sold by the Fund.
FUND SERVICE PROVIDERS
The Fund could not function without the services provided by certain
companies. In addition to the investment management services provided by
the Manager, some of the additional services provided by East End Invest-
ment Management Company and by others are listed below.
Custodian;
Provident Bank, Cincinnati, Ohio 45202 (the "Custodian") holds the invest-
ments and other assets that the Fund owns. The Custodian is responsible
for receiving and paying for securities purchased; delivering against
payment for securities sold; receiving and collecting income from invest-
ments; making payments covering expenses of the Fund, and performing other
administrative duties, all directed by persons authorized by the Fund.
The Custodian does not exercise any supervisory function in such matters
as the purchase and sale of portfolio securities, payment of dividends, or
payment of expenses of the Fund.
Portfolio securities of the Fund purchased in the United States are main-
tained in the custody of the Custodian, and may be entered in the
Federal Reserve Book Entry System, or the security depository system of
The Depository Trust Company.
Transfer and Administrative Services, Accounting Services and Portfolio
Pricing Services; East End Investment Management Company, 736 West End
Avenue, Suite 3A, New York, New York 10025. provides transfer agency,
administrative and portfolio pricing services for the Fund. Its function
is to maintain, accurately, the account records of the Fund and of all
shareholders in the Fund as well as to administer the distribution of
income earned as a result of investing in the Fund. East End Investment
Management Company also provides accounting services to th Fund including
portfolio accounting services, expense accrual and payment services,
valuation and financial reporting services, tax accounting services and
compliance control services.
HOW TO INVEST IN THE FUND
Initial Investments
To open a new account-complete and return, by mail, a New Account Applica-
tion (a New Account Application Form is included with this Prospectus and
any required legal documentation together with your check or money
order, or you may download the Prospectus and New Account Application
from our website at WWW.EASTEND-MUTUALFUNDS.COM The completed New
Account Application, together with your check or money order and any
additional documentation required should be mailed to East End Mutual
Funds, Inc., 736 West End Avenue, Suite 3A, New York, New York 10025.
The amount of your first purchase must be $1,000. If you need assistance
with the account registration form or have any questions, please call our
Investor Information Department at 1-877-309-6565. Note: For other types
of account registrations such as for corporations, partnerships, trusts or
other organizations, please call the Investor Information Department to
determine which additional forms you will need. Your Fund shares will be
purchased at the next determined net asset value after your investment has
been received.
Subsequent Investments
Subsequent investments must be in the amount of $250 or more. To make a
subsequent investment:
* Detach and complete the stub attached to your account receipt or
statement from your previous investment.
* Make your check or money order payable to East End Mutual Funds, Inc.
* Write your shareholder account number on the check.
Mail your check and investment form to East End Mutual Funds, Inc.,
736 West End Avenue, Suite 3A, New York, New York 10025.
All investments must be made in U.S. dollars and to avoid fees and delays,
your check should be drawn only on a U.S. bank. A charge may be imposed
if any investment check is not honored.
The Company reserves the right, in its sole discretion, to withdraw all
or any part of the offering made by this prospectus or to reject purchase
orders, when in the judgment of management, such withdrawal or rejection
is in the best interest of the Fund. The Fund also reserves the right at
any time to waive or increase the minimum investment requirements
applicable to initial or subsequent investments. No share purchase applica-
tion is binding till accepted by the Fund. Stock certificates will not be
issued. All investor accounts are maintained on a "book-entry" basis.
Following any investment, the investor will receive a printed confirmation
stating the amount invested, the per share price at which the investment
was made, and the number of shares purchased.
HOW NET ASSET VALUE IS DETERMINED
The price of the Fund's shares is based on the net asset value of the Fund,
which is determined once daily as of 4:00 p.m. East Coast time on each day
that the New York Stock Exchange is open for business. The per share net
asset value of the Fund is determined by dividing the total value of
its securities and other assets, less liabilities, by the total number of
its shares outstanding. In determining net asset value, securities are
valued at the last reported sales price or in the case of securities where
there is no reported last sale, the closing bid price. Securities for which
market quotations are not readily available are valued at their fair values
as determined in good faith by or under the supervision of the Company's
Board of Directors in accordance with methods which have been authorized by
the Board. Short term debt obligations with maturities of 60 days or less
are valued at amortized cost as reflecting fair value, unless the Manager
determines conditions indicate otherwise.
Taxation Identification Numbers
Shareholders are required by law to provide the Fund with their correct
social security or other taxpayer identification number ("TIN"), regardless
of whether they file tax returns,failure to do so may subject a shareholder
to penalties. Failure by a shareholder to provide a correct TIN or properly
to complete the New Account Application, could result in backup withholding
by the Fund of an amount of income tax equal to 31% of distributions,
redemptions or other payments made to the shareholder's account. Any
taxes so withheld may be credited against taxes owed on the shareholder's
federal income tax return. Once withholding is established, all withheld
amounts will be paid to the Internal Revenue Service, from whom such
shareholder should seek any refund. If withholding is commenced with
respect to any shareholder account, the shareholder should consult with
the shareholder's attorney or tax advisor or contact the Internal Revenue
Service directly.
If a shareholder is a non-resident of the United States or other foreign
entity, a completed Form W-8 should be provided to the Fund in order to
avoid backup withholding on distributions, redemptions or other payments
made by the Fund. Payments made to the account of such a shareholder by the
Fund may be subject to federal income tax withholding of up to 30% of the
amount of such payment in lieu of backup withholding. The amount of backup
withholding will change if the tax code so requires in the future.
A shareholder which is an exempt recipient must furnish its TIN. Exempt
recipients include: certain corporations, tax-exempt pension plans, Keogh
and IRA accounts, governmental agencies, financial institutions and reg-
istered securities and commodities dealers.
For further information regarding backup withholding, see Section 3406 of
the Internal Revenue Code and consult with a tax advisor. Information for
Clients of Brokers or Other Financial Organizations:
If you are a client of a securities broker or other financial organization,
you should note that they may charge their clients a separate fee for
administrative services in connection with investments in Fund shares
and may impose account minimums and other requirements. Please refer to
their program materials for any additional special provisions or conditions
that may be different from those described in this Prospectus (for example,
some or all of the services and privileges described may not be available
to you). Securities brokers and other financial organizations have the
responsibility of transmitting purchase orders and funds, and of crediting
their customers' accounts following redemptions, in a timely manner in
accordance with their customer agreements and this Prospectus.
PLAN OF DISTRIBUTION
The Fund has adopted a Distribution Plan pursuant to which the Fund may
incur distribution expenses of up to one half of one percent (0.50%) per
annum of the Fund's average daily net assets. The Plan of Distribution
provides that the Fund may finance activities which are primarily
intended to result in the sale of the Fund's shares including, but not
limited to, direct mail promotions; television, radio, internet, newspaper,
magazine and other types of mass media advertising; compensation of
persons engaged in the marketing and sale of Fund shares; costs of
preparing printing, distributing prospectuses and reports to prospective
shareholders; costs involved in preparing, printing and distributing
sales literature, and the Fund's costs of obtaining information, analyses
and reports with respect to market and promotional activities on
behalf of the Fund that the Manager deems advisable.
HOW TO SELL (REDEEM) YOUR SHARES
You may sell (redeem) your shares at any time this must be done in writing
by the shareholder.
By Mail: Sale requests should be mailed to:
East End Mutual Funds, Inc.
736 West End Avenue, Suite 3A
New York, NY 10025-6245
Should you wish to send your redemption request by overnight courier,
the request for redemption should be sent to:
East End Mutual Funds, Inc.
736 West End Avenue, Suite 3A
New York, NY 10025-6245
The selling price of the shares being redeemed will be the per share
net asset value next calculated after receipt of required documents in
Good Order. Good Order means that the request must include:
1. Your name as shown on the statement and account number
2. The number of shares to be sold (redeemed) or dollar amount.
3. The signatures of all account owners exactly as they are
registered on the account.
4. Required signature guarantees.
5. Any supporting legal documentation that is required in
the case of estates, trusts, corporations or partnerships
and certain other types of accounts.
Signature Guarantees -
A signature guarantee of each owner is required to redeem shares for
transactions and in the following additional situations:
(i) if you change the ownership on your account; and
(ii) if a change of address request is made, a redemption will not be
processed until a signature guarantee is received in proper form.
Signature Guarantees may be obtained from your bank or stock broker. Signature
guarantees are designed to protect both you and the Fund from fraud. To
obtain a signature guarantee you should visit your commercial bank,trust
company, broker-dealer or other member of a national securities exchange,
or other eligible guarantor institution. (Notaries public cannot provide
signature guarantees.) Guarantees must be signed by an authorized person
at one of these institutions, and be accompanied by the words stamped
"Signature Guarantee."
Redemption at the Option of the Fund
If the value of the shares in a shareholder's account is less than $1,000,
the Company may notify the shareholder that, unless the shareholder's Fund
account is increased to $2,000 in value, it will redeem all the share-
holder's shares and close the account by paying the shareholder the
redemption proceeds and any dividends and distributions declared and
unpaid at the date of redemption. The Company will give the shareholder
thirty days after it sends the notice to bring the account to $1,000 before
any action is taken. This minimum balance requirement does not apply to
IRAs, Keogh's and other tax-sheltered investment accounts. The Company
reserves this right because of the expense to the Fund of maintaining very
small accounts.
GENERAL INFORMATION
East End Mutual Funds, Inc. was organized on December 22, 1993 as a
corporation under the laws of the State of Maryland and is registered with
the U.S. Securities and Exchange Commission as an open-end, diversified,
management investment company of the series type. It is authorized to
issue two million shares of $.001 par value common capital stock. The
Company's Articles of Incorporation permit its Board of Directors to
classify unissued shares into one or more classes. Pursuant to this
provision, the Board has authorized the issuance of one million shares of
the Fund. While the Fund is currently the only series of the Company, the
Board of Directors may, from time to time, issue other series, the assets
and liabilities of which will be separate and distinct from any other
series.
Shares issued with respect to the Fund have no preemptive, conversion or
subscription rights. Each whole share will be entitled to one vote as to
any matter on which a vote is authorized and each fractional share
shall be entitled to a proportionate fractional vote. Shareholders have
equal and exclusive rights as to dividends and distributions, as declared
by the Company with respect to the Fund, and to the net assets of the Fund
upon liquidation or dissolution. The shareholders of the Fund, as a
separate series of the Company, vote separately on matters affecting only
the Fund (e.g. approval of the Investment Management Agreement, a change
in investment policy); all series of the Company will vote as a single
class where the interests of each class in the matters to be acted upon
are identical.
DIVIDENDS AND DISTRIBUTIONS
The Company currently intends to distribute all of the Fund's net invest-
ment income and net capital gains, if any, at least annually. Such
distribution will consist of substantially all of the net investment
income for the fiscal year plus substantially all of the net long and short
term capital gains for the twelve month period ending on December 31.
A second distribution, if required to avoid the imposition of tax on the
Fund, will be declared and paid following the end of the Fund's Taxable
year and will include any undistributed net investment income and net
capital gain for such taxable year, to the extent deemed necessary by the
Company. The amount and frequency of distributions by the Company with
respect to the Fund are not guaranteed and are subject to the discretion of
the Company's Board of Directors. Dividends paid by the Company with
respect to the Fund are derived from its net investment income.
The Fund's net investment income is made up of dividends received from
the stocks it holds, as well as interest accrued and paid on money
market instruments and other fixed-income obligations held in its port-
folio.
The Fund realizes capital gains when it sells a security for more than it
paid for it. The Fund may make distributions of its net realized capital
gains (after any reductions for capital loss carry forwards), generally,
once a year. Gains on securities sales held for 90 days or less shall not
exceed 30% of the Fund's income including capital gains as long as such
sale is considered as a disqualification as a regulated investment
company under the Internal Revenue Code.
You must elect one of the following distribution options. You may make
such election on your New Account Application form.
1. Automatic Reinvestment Option - All dividends and capital gains
distributions will be re-invested in additional Fund shares.
2. Cash Option - all dividends and capital gains distributions will be
paid in cash.
If you do not elect one of the above Options, Option number 1 will be
selected for you automatically. You may change your Option by writing to
East End Mutual Funds, Inc., 736 West End Avenue, Suite 3A, New York, NY
10025.
The election is effective for dividends and distributions with a record
date seven or more business days after the date the Transfer Agent is
notified of the election.
TAXATION
As with any investment, you should consider the tax implications of an
investment in the Fund. The following is only a short summary of the
important tax considerations generally affecting the Fund and its share-
holders. You should consult your tax adviser with specific reference to
your own tax situation.
Federal Taxes. The Fund qualifies and maintains its qualification as a
"regulated investment company" under the Internal Revenue Code (hereafter
the "Code"), meaning that to the extent a fund's earnings are passed on
to shareholders as required by the Code, the Fund itself is not
required to pay federal income taxes on the earnings. In order to so
qualify, at least 90% of the investment company taxable income of the Fund
will be paid as dividends. Investment company taxable income includes
taxable interest and dividends. To the extent you receive such a dividend
based on either investment company taxable income or a distribution of the
excess of net short-term capital gain over net long-term capital loss,
you would treat that dividend or distribution as ordinary income in
determining your gross income for tax purposes, whether or not you
received payment in the form of cash or additional shares. Unless you are
exempt from federal income taxes, the dividends and short-term capital
gain distributions you receive from the Fund will be taxable to you as
ordinary income.
Any distribution you receive of net long-term capital gain over net
short-term capital loss will be taxed as long-term capital gain no
matter how long you have held Fund shares. If you hold shares for twelve
months or less, and during that time receive a distribution that is taxable
as long-term capital gain, any loss you might realize on the sale of those
shares will be treated as a long-term capital loss to the extent of the
distribution.
Before you purchase shares of the Fund, you should consider the effect
of both dividends and capital gain distributions that are expected to
be declared or that have been declared but not yet paid. When a Fund
makes these payments, its share price will be reduced by the amount of
the payment, so that you will in effect have paid full price for the
shares and then received a portion of your price back as a taxable dividend
distribution.
The Fund will notify you annually as to the tax status of dividend
and capital gains distributions paid by the Fund. Such dividends and
capital gains may be subject to state and local taxes. In the event a
shareholder fails to furnish and certify a taxpayer identification
number (See "Taxpayer Identification Numbers," p.12), or the Internal
Revenue Service notifies the Fund that a shareholder's taxpayer identi-
fication number is incorrect, or that withholding is otherwise required,
the Fund will commence withholding on such shareholder's account.
Any dividends declared by a fund in October, November or December of a
particular year and payable to shareholders of record during those months
will be deemed to have been paid by the Fund and received by shareholders
on December 31st., of that year, as long as the dividends are actually paid
in January of the following year.
Dated: September 13,2000
New York, New York
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VIEWS OF THE MANAGER
ANNUAL REPORT
FOR THE 12 MONTHS ENDED JUNE 30,2000
Dear Fellow Investor:
The total return for East End Capital Appreciation Fund in the
twelve months fiscal year end on June 30, 2000 was 106.69%, much
greater than that of the Standard & Poor's 600 Index which was
12.70% and the Russell 2000 Index 16.20 %. For the period October
2, 1995 the inception of the Fund to June 30, 2000 the average
annual total return for the Fund was 26.36 % , Standard & Poor's 600
16.92 %, Russell 2000 15.03 %. A $10,000 investment during this
period returned $ 22,521 for the Fund, $18,038 for the Standard
& Poor's 600 and $17,137 for the Russell 2000. Dividends and
distributions are included expenses have not since the Index's have
none. A exceptional performance for the Fund compared to its peers
Sensing the markets rotation out of old into new industry equities
the Manager invested in new industry equities that had been out of
favor in 1999. These industries were in Business to Business,
Client Management Resources, and Client Access Protection for
website. These companies provided software and services to industry
for internet website, enabling the efficient and cost effective
management of customer sales, service and information access for
customers and employees. The Fund held Seibel Systems, Oracle, and
Checkpoint Systems leading providers of such software and services.
The internet needed high speed large bandwidth data access to enable
commerce over the internet that would replace copper wire with
fiber optic telephone equipment and lines of which Nortel Networks,
Comverse Communications, and JDS Uniphase, provided all were
holdings of the Fund.
Management will continue to seek insights into future
developments in the marketplace and continue to provide above
average returns for the Fund's shareholders.
We look foward to a continuing relationship with our current
shareholders and to reward their confidence in management.
Sincerely,
/s/ Aristides Matsis, President
FUND HIGHLIGHTS
The total return for East End Capital Appreciation Fund in the
twelve months fiscal year end on June 30, 2000 was 106.69%, much
greater than that of the Standard & Poor's 600 Index which was
12.70% and the Russell 2000 Index 16.20 %. For the period October
2, 1995 the inception of the Fund to June 30, 2000 the average
annual total return for the Fund was 26.36 % , Standard & Poor's 600
16.92 %, Russell 2000 15.03 %. A $10,000 investement during this
period returned $ 22,521 for the Fund, $18,038 for the Standard
& Poor's 600 and $17,137 for the Russell 2000. Dividends and
distributions are included expenses have not since the Index's have
none. A exceptional performance for the Fund compared to its peers
MARKET HIGHLIGHTS
Sensing the markets rotation out of old into new industry equities
the Manager invested in new industry equities that had been out of
favor in 1999. These industries were in Business to Business,
Client Management Resources, and Client Access Protection for
website. These companies provided software and services to industry
for internet website, enabling the efficient and cost effective
management of customer sales, service and information access for
customers and employees. The Fund held Seibel Systems, Oracle, and
Checkpoint Systems leading providers of such software and services.
This graph and chart is presented in accordance with SEC
regulations, compares a $10,000 investment in the Fund made at
inception, with the performance of the Standard & Poor's 600 Index
and the Russell 2000 Index which are a basket of unmanaged stocks
with similar characteristics as the Fund invests in. Results include
the reinvestment of all capital gains distributions but no expenses
since Index's have none. Performance is historical and does not
represent future results. Investment returns and principal value
vary and you may have a gain or loss when you sell shares.
The bar chart shows variability of the Fund's shares as a percent
change of net asset value on a fiscal year basis. During the
4 3/4 year period shown in the bar chart, the highest return for a
12 month period was 106.69% for the last fiscal year ending June
30, 2000 and the lowest return was -17.87% for the 12 month
period ending June 30,1997. .
RISK RETURN TABLE
Average Annual
Total Returns Past Past 4
For the periods Year 3/4
ending Years
June 30, 2000 10/95 to
6/2000
East End Capital
Appreciation 125.21 % 26.36 %
Standard & Poor's
600 Index 12.70 % 16.92 %
Russell 2000 Index
16.20 % 15.03 %
The Fund's total return over its last fiscal year ending June
30, 2000 relative to the Standard and Poor's 600 and Russell 2000
both are broad based unmanaged market index's with similar
investment objectives as the Fund were as follows: the Fund's
fiscal one year return was 125.21%, the Standard and Poor's 600
Index was 12.70% and the Russell 2000 16.20%.
EAST END MUTUAL FUNDS - CAPITAL APPRECIATION SERIES
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
SHARES VALUE
COMMON STOCKS - 91.8%
Commercial Services Security - 16.6 %
Checkpoint Software Tech.Ltd. * 365 77,289
Computer Software - 22.6%
Oracle Corporation * 580 48,756
Siebel Systems * 340 55,611
Insurance - 2.1%
Conseco, Inc. 200 9,750
Internet Services - 7.9%
TIBCO Software Inc. * 340 36,699
Medical Equipment - 0.8%
VISX Inc. * 130 3,648
Pharmaceuticals - 9.0%
Andrx Corp. * 323 20,652
Inhale Therapeutic Systems * 210 21,315
Semiconductors - 8.0%
Intel Corp. 270 36,096
Telecommunications Equipment - 24.8%
Comverse Technolgy Inc. * 280 26,040
JDS Uniphase Corp. * 210 25,174
Nortel Networks Corp. * 672 46,536
Qualcomm Corp. * 280 16,800
Total Investments - 91.8% 424,366
Cash and Other Assets Less Liabilities - 8.2% 37,224
$ 462,224
* Non income producing security
The accompanying notes are a integral part of these financial statements
SANVILLE & COMPANY
Certified Public Accountants
1514 Old York Road
Abington, PA 19001
215 884-8460
INDEPENDENT AUDITORS REPORT
To the Shareholders and
Board of Directors of the
East End Mutual Funds, Inc.
Capital Appreciation Series
We have audited the accompanying statement of assets and liabilities
of East End Mutual Funds. Inc.- Capital Appreciation Series,
including the schedule of investments owned as of June 30, 2000 and
the related statement of operations for the year then ended, the
statement of changes in net assets and the financial highlights for
each of the periods indicated therein. These financial statements
and financial highlights are the responsibility of the Fund's
management Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of June 30, 2000 by
correspondence with the custodian and brokers,. An audit also
includes assessing the accounting principles used and significant
estimates when made by management as well as evaluating the overall
financial statement presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of East End Mutual Funds, Inc. - Capital
Appreciation Series as of June 30, 2000 the results of its
operations for the year then ended, the changes in its net assets
and the financial highlights for each of the periods indicated
therein, in conformity with generally accepted accounting principles.
Abington, Pennsylvania
Sanville & Company
August 2, 2000
Certified Public Accountants
EAST END MUTUAL FUNDS, INC, - CAPITAL APPRECIATION SERIES
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000
ASSETS
Investments in securities at value
Cost - $173,637)( Notes 1 and 3) $ 424,366
U.S. Government securities money market account 5,338
Cash at custodian bank 1,043
Dividend receivable 28
Receivable for investment securities sold 81,952
Total assets 512,737
LIABILITIES
Due to manager 357
Payable for investment securities purchased 50,146
Total liabilities 50,503
NET ASSETS $ 462,224
Net assets consist of :
Capital paid-in $ 212,995
Accumulated net realized loss on investments ( 1,500)
Net unrealized appreciation of investments 250,729
NET ASSETS $ 462,224
NET ASSET VALUE PER SHARE
(based on 22,014 shares outstanding -
authorized with a $.001 per share par value) $ 21.00
The accompanying notes are an integral part of these financial
statements
EAST END MUTUAL FUNDS, INC. - CAPITAL APPRECIATION SERIES
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 2000
INVESTMENT INCOME
Income
Dividends $ 1,085
Total income
1,085
Expenses
Investment management fees (Note 2) 3,552
Custodian fees 2,667
Total expenses 6,229
Net investment loss ( 5,144)
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investments 700
Change in net unrealized gain on investments 243,672
Net realized and unrealized gain on investments 244,372
Net increase in net assets resulting from operations $ 239,228
The accompanying notes are an integral part of these financial
statements
EAST END MUTUAL FUNDS - CAPITAL APPRECIATION SERIES
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
June 30, 2000 June 30, 2000
INCREASE (DECREASE) IN NET ASSETS:
From Operations:
Net Investment loss $ (5,144) $ ( 2,904)
Net realized gain on investments 700 1,835
Change in net unrealized appreciation
on investments 243,672 15,687
Net increase (decrease) in net assets
resulting from operations 239,228 14,618
Distributions to shareholders from:
Net investment income
Net realized gain
Total distributions
Share Transactions
Net proceeds from sales of shares 1,006
Reinvestment of distributions
Cost of shares redeemed ( 2,500)
Net decrease in net assets resulting
from share transactions ( 1,494)
Total increase in net assets 237,734 14,618
Net Assets
Beginning of year 224,490 209,872
End of year 462,224 224,490
Other information
Shares:
Sold 55
Issued in reinvestment of distributions
Redeemed ( 135)
Net (decrease) ( 80)
The accompanying notes are an integral part of these financial statements
EAST END MUTUAL FUNDS, INC. - CAPITAL APPRECIATION SERIES
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
For the Year Ended June 30 Oct 2,1995
to
2000 1999 1998 1997 1996
PER SHARE OPERATING PERFORMANCE
NET ASSET VALUE, BEGINNING OF PERIOD($) 10.160 9.500 10.340 13.730 10.480
INCOME FROM INVESTMENT OPERATIONS:
Net Investment Loss ( 0.018) (0.130) (0.290) (0.370) (0.007)
Net Realized and Unrealized Gain
(Loss) on Investments 10.858 0.790 (0.550) (2.083) 3.335
TOTAL FROM INVESTMENT OPERATIONS 10.840 0.660 (0.840) (2.453) 3.328
LESS DISTRIBUTIONS:
Distributions from Net Realized gain: 0.937 0.078
TOTAL DISTRIBUTIONS 0.937 0.078
NET ASSET VALUE,END OF PERIOD ($) 21.000 10.160 9.500 10.340 13.730
TOTAL RETURN (%) 106.693 6.947 (8.124)(17.870) 31.730
RATIOS / SUPPLEMENTAL DATA:
Ratio of Expenses (After Reimbursement)
to Average Net Assets (%) 1.801 2.668 3.057 4.840 2.770 *
Ratio of Net Investment Loss to Average
Net Assets (%) (1.488) (1.411) (2.658) (3.670) (0.910)*
Portfolio Turnover Rate (%) 42.139 77.364 86.840 26.980 65.810%
NET ASSETS, END OF PERIOD($) 462,224 224,490 209,872 235,139 $284,414
* annualized
The accompanying notes are an integral part of these financial statements
EAST END MUTUAL FUNDS,INC.- CAPITAL APPRECIATION SERIES
NOTES TO FINANCIAL STATEMENTS
June 30, 2000
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Organization: East End Mutual Funds, Inc.- Capital Appreciation Series
("the Fund") is a series of East End Mutual Funds, Inc. ("the Company")
a Maryland corporation. The Fund is a diversified open end management
company registered under the Investment Company Act of 1940 as amended.
The following is a summary of significant accounting policies followed
by the Fund.
Security Valuation: Securities are valued at the last reported sales price
or in the case of securities where there is no reported last sale, the
closing bid price. Securities for which market quotations are not readily
available are valued at their fair values as determined in good faith by
or under the supervision on the Company's Board of Directors in accordance
with methods which have been authorized by the Board. Short term debt
obligations with maturities of 60 days or less are valued at amortized cost
which approximates market value.
Securities Transactions and Investment Income: Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Realized gains and losses on security transactions are determined on the
identified cost basis. Dividend income is recorded on the ex-dividend date.
Interest income is determined on the accural basis. Discount on fixed
income securities is amortized.
Dividends and distributions to Shareholders: The Fund records all dividends
and distributions payable to shareholders on the ex-dividend date.
Permanent book and tax difference relating relating to shareholder dist-
ributions may result in reclassifications to paid in capital and may affect
the per share allocation between net investment income and realized and un-
realized gain/loss. Undistributed net investment income and accumulated
undistributed net realized gain/loss on investment transactions may include
temporary book and tax differences which reverse in subsequent periods. Any
taxable income or gain remaining at fiscal year end is distributed in the
following year.
Federal Income Taxes: It is the Fund's intention to qualify as a regulated
investment company and distribute all of its taxable income. accordingly
no provision for Federal income taxes will be made.
2. MANAGEMENT FEE AND TRANSACTIONS WITH AFFILIATES
Unlike the terms of the investment management agreement, East End Investment
Management Company ("the Manager") has agreed to provide the Fund investment
management services and be responsible for the day to day operations of the
Fund. The Manager will receive a fee payable monthly, for the performance of
its services at an annual rate of 1% on the first $500 million of average
daily net assets and .75% in excess of $500 million of average daily net
assets. The fee will be accrued daily and paid monthly. A management fee of
$3,552 was paid for the year ended June 30, 2000.
The Manager has voluntarily agreed to bear expenses of the Fund in excess
of 1% of daily net assets plus custodian fees over and above the management
fee.
The Manager provided transfer agency, portfolio pricing, administration
accounting, financial reporting, tax accounting and compliance services to
the fund at no charge for the year ended June 30, 2000.
The fund has adopted a distribution Plan ("the Plan") pursuant to Rule 12b-1
under the Investment Company Act of 1940. The Plan provides that the Fund may
finance activities which are primarily intended to result in the sale of the
Fund's shares. The Fund may incur distribution expenses of up to .50% of
average daily net assets. No distribution fee was accrued for the year ended
June 30, 2000.
Certain officers and directors of the Fund are also officers and directors o
the Manager.
3. INVESTMENT TRANSACTIONS:
Purchases and sales of investment securities (excluding short-term
securities) for the year ended June 30, 2000 were $140,289 and $169,559
respectively.
At June 30, 2000 net unrealized appreciation for federal income tax purposes
aggregated $250,729 of which $258,759 related to unrealized appreciation of
securities and $8,030 related to unrealized depreciation of securities. The
cost of investments at June 30,2000 for federal income tax purposes was
$173,637.
STATEMENT OF ADDITIONAL INFORMATION
EAST END MUTUAL FUNDS, INC.
Capital Appreciation Series
736 West End Avenue, Suite 3A
New York, NY 10025-6245
Tel. No.: 1-877-309-6565
Dated: September 13, 2000
This Statement of Additional Information is not a
prospectus. It contains information in addition to that set forth
in the Fund's prospectus, dated June 30,2000 It is intended to
provide you with more detailed information regarding the
activities and operations of the Fund, and should be read in
conjunction with the prospectus, a copy of which may be obtained
from East End Mutual Funds, Inc. without charge at the address
stated above or by calling the above number.
TABLE OF CONTENTS
Page
The Company . . . . . . . . 3
Investment Objective and Policies . . . . . 3
Investment Restrictions . . . . . . . 7
Distribution Plan . . . . . . . . 9
Distributions of Dividends. . . . . . . 10
Directors and Officers . . . . . . . 11
Control Persons and Principal
Holders of Securities . . . . . . 13
The Investment Manager . . . . . . . 13
Execution of Portfolio Transactions . . . . .16
Additional Purchase afnd Redemption Information . . .17
Tax Information . . . . . . . . 19
Description of Predecessor Company
and Management . . . . . . . 23
Independent Auditors . . . . . . . 23
Measuring Performance . . . . . . . 23
THE COMPANY
East End Mutual Funds, Inc. (the "Company") is an open-
end, diversified management investment company. The Company
currently offers shares of the Capital Appreciation series only.
Prior to its organization as a corporation, the Company was
organized and operated as a private investment trust.
East End Investment Management Company (the "Manager")
manages the portfolio of assets of the Capital Appreciation
series.
INVESTMENT OBJECTIVE AND POLICIES
The investment objective and policies of the Fund are
described in detail in the Fund's prospectus. The following
discussion supplements the Prospectus discussion.
"When Issued" Securities
The Fund may, from time to time, purchase securities on
a "when-issued" basis. The price of such securities is fixed at
the time when the purchase is made, but delivery and payment for
the "when-issued" securities take place at a later date.
Normally, the settlement date, when payment is made, occurs
within one month of the date of purchase. While "when-issued"
securities may be sold prior to the settlement date, it is the
intention to purchase such securities for the purpose of
acquiring them unless a sale appears more advantageous. At the
time a commitment is made to purchase a security on a "when-
issued" basis, the transaction will be recorded and the value of
the security reflected in the Fund's per share net asset value.
The market value of the "when-issued" securities may be more or
less than the purchase price at the time of settlement. The
Manager does not believe that the Fund's per share net asset
value will be adversely affected by its purchase of securities on
a "when-issued" basis. The Fund will establish a segregated
account with its custodian bank in which it will maintain cash
and high-grade liquid debt securities equal in value to the
commitments for "when-issued" securities. Such securities either
will be acquired or, if appropriate, will be sold on or before
the settlement date. To the extent that assets in the Fund are
held in cash pending settlement of the purchase of "when-issued"
securities, the Fund will earn income on these assets.
By taking a position in the "when-issued" securities
before the settlement date, the Manager will secure its allotment
of a security on behalf of the Fund at a known price and quantity
instead of taking a chance that the securities will be available
later, on the open market, at a price and quantity that suits the
Manager.
Short Term Trading
In seeking the Fund's objective, the Manager will
buy or sell portfolio securities whenever the Manager believes it
is appropriate to do so. In deciding whether it is appropriate
to sell portfolio securities, the Manager does not consider how
long the Fund has owned the security. From time to time, the
Fund securities will be purchased with a view of realizing short-
term trading profits. By exec uting short-term sales, the Manager
limits its exposure to losses which may be greater than the costs
and expenses of trading involved. Changes in the securities held
in the Fund's portfolio is known as "portfolio turnover" and
generally involves some expenses to the Fund. These expenses may
include brokerage commissions or dealer mark-ups and other
transaction costs on both the sale of the securities and the
reinvestment of the proceeds in other securities. If sales of
the portfolio securities cause the Fund to realize short term
capital gains, such gains will be taxable as ordinary income. As
a result of the Fund's investment policies, under certain market
conditions the Fund's portfolio turnover rate may be greater than
that of other mutual funds. Portfolio turnover rate for a fiscal
year is the ratio of the lesser of purchases or sales of
securities to the monthly average of the value of securities--
excluding securities whose maturities at acquisition were one
year or less. The Fund's portfolio turnover rate is not a
limiting factor when the Manager considers a change in the Fund's
portfolio.
Foreign Securities
Since foreign securities are normally denominated and
traded in foreign currencies, the values of the Fund's assets may
be affected favorably or unfavorably by currency exchange rates
and exchange control regulations. Exchange rates with respect to
certain currencies may be particularly volatile and the Fund's
policy is not to invest in securities denominated in those
currencies. There may be less information publicly available
about a foreign company than a U.S. company and while foreign
companies are not generally subject to accounting, auditing and
financial reporting standards and practices comparable to those
in the U.S., the American Depository Receipts and U.S.investment
companies which invest in the securities of issuers located in
particular foreign countries ("country funds") are subject to
such U.S. reporting and accounting standards and practices.
Foreign income taxes may be withheld at the source on payment of
dividends of the foreign issuer.
The securities of some foreign companies are less
liquid and at times more volatile than securities of comparable
U.S. companies. Foreign brokerage commissions and other fees are
also generally higher than in the U.S.
In addition, with respect to certain foreign countries,
there is a possibility of nationalization or expropriation of
assets, confiscatory taxation, political or financial instability
and diplomatic developments which could affect the value of
investments in those countries. In certain countries, legal
remedies available to investors may be more limited than those
available with respect to investments in the U.S. or other
countries. The laws of some foreign countries may limit the
Fund's ability to invest in securities of certain issuers located
in those countries. Special tax consideration apply to foreign
securities. The Fund intends to invest only in the American
Depository Receipts, the shares of foreign companies whose shares
are directly listed on U.S. exchanges and in the shares of
country funds to eliminate or minimize some of the foregoing
risks.
Securities Loans
The Fund may make secured loans of its portfolio
secur6ities amounting to no more than 25% of its total assets,
thereby realizing additional income. The risks of lending
portfolio securities, as with other extensions of credit, consist
of possible delay in recovery of the securities or possible loss
of rights in the collateral should the borrower fail
financially. As a matter of policy, securities loans are made to
broker dealers pursuant to agreements requiring that the loans
continuously be secured by collateral consisting of cash or short
term debt obligations at least equal at all times to the value of
the securities on loan. The borrower pays to the Fund an amount
equal to any dividends and interest received on securities lent.
The Fund retains all or a portion of the interest received on
investment of the cash collateral or receives a fee from the
borrower. Although voting rights, or rights to consent, with
respect to the loaned securities pass to the borrower, the Fund
retains the right to call the loans on reasonable notice at any
time, and it will do so to enable the Fund to exercise voting
power on any matters materially affecting the investment. The
Fund may also call such loans to sell the securities. This
practice allows the Fund to have interest income it would not
have had otherwise.
INVESTMENT RESTRICTIONS
The following investment restrictions have been adopted
by the Fund and (unless otherwise noted) are fundamental and
cannot be changed without the affirmative vote of a majority of
the Fund's outstanding voting securities. The Fund may not:
1. With respect to 75% of its total assets, invest in
the securities of any one issuer (other than those issued or
guaranteed as to principal and interest by the U.S. Government
and its agencies and instrumentalities), if immediately after and
as a result of such investment (a) more than 5% of the total
assets of the Fund would be invested in the securities of such
issuer or (b) more than 10% of any class of the outstanding
voting securities of any issuer would be held.
2. Make loans to others, except (a) by the purchase
of debt securities which are either publicly distributed or
customarily purchased by institutional investors, and (b) by
lending of up to 25% of its portfolio securities.
3. (a) Borrow money other than from a bank for
temporary or emergency purposes and then only in an amount not in
excess of 5% of its total assets (at the lower of cost or fair
market value): any such borrowing will be made only if
immediately thereafter there is asset coverage of at least 300%
of all borrowings; (b) mortgage, pledge or hypothecate any of
its assets except in connection with permissible borrowings.
4. Purchase securities on margin or underwrite
securities.
5. Invest in oil, gas or mineral exploration or
development leases and programs, or real estate. (This does not
preclude investments in marketable securities of issuers engaged
in such activities.)
6. Invest in commodities or commodity contracts.
7. Invest more than 25% of the market value of its
total assets in the securities of companies engaged in one
industry. (This restriction does not apply to securities of the
U.S. Government, its agencies 0and instrumentalities.)
8. Issue senior securities except that the Fund shall
not be prohibited from making any permitted borrowings, mortgages
or pledges.
9. Engage in the short sales of securities.
10. Invest more than 5% of its total assets in
securities of any one issuer which, together with predecessors,
has not had a record of at least three years of continuous
operation.
11. Invest in the securities of other investment
companies, except as such securities may be acquired as part of a
merger, consolidation or acquisition of assets and except as to
investments in foreign country funds which are registered
investment companies.
12. Invest in securities with legal or contractual
restrictions on resale, or securities which are not readily
marketable.
13. Invest in any issuer for purposes of exercising
control or management.
Investment restrictions, 1 through 9 are fundamental
policies and may not be changed without shareholder approval.
Investment restrictions 10 through 13 may be changed
without shareholder approval.
The percentage limitations set forth in the investment
restrictions described above, are considered at the time that
securities are purchased.
DISTRIBUTION PLAN
The Fund has adopted a Distribution Plan pursuant to
Rule 12b-1 under the Investment Company Act of 1940. The purpose
of the plan is to permit the Fund to compensate dealers for
services provided and for advertising, promotion and other
distribution expenses. The 12b-1 fee will be capped at the annual
rate of .50% of the Fund's average net assets, subject to the
right of the Fund's Board of Directors to reduce the amount of
payments or to suspend the Plan for such periods as they may
determine.
Subject to these limitations, the amount of such
payments and the specific purposes for which they are made shall
be determined by the Board of Directors of the Fund.
Continuance of the plan is subject to annual approval
by the Board of Directors of the Company, including a majority of
the Board of Directors who are not interested persons of the
Company and who have no direct or indirect interest in the Plan
or related agreements (the "Rule 12b-1 Directors"), cast in
person at meeting called for that purpose. All material
amendments to the Plan must likewise be approved by the Board of
Directors, including a majority of the Rule 12b-1 Directors. The
Plan may not be amended in order to increase materially the costs
the Fund may bear for distribution pursuant to the Plan without
being approved by a majority of the outstanding voting securities
of the Fund. The Plan terminates automatically in the event of
its assignment and may be terminated without penalty, at any
time, by a vote of a majority of the outstanding voting
securities of the Fund or by a vote of the majority of the Rule
12b-1 Directors.
DISTRIBUTIONS OF DIVIDENDS
Distributions to Shareholders
The Fund intends to declare and pay dividends and other
distributions, as stated in its Prospectus. In order to avoid
the payment of any federal exmcise tax, the Fund must declare on
or before December 31 of each year distributions at least equal
to 98% of its ordinary income for that calendar year and at least
98% of the excess of any capital gains over capital losses
realized in the 12 month period ending October 31 of that year,
together with any undistributed amounts of ordinary income and
capital gains from the previous calendar year on which no federal
income tax was paid.
Distributions by the Fund result in the reduction of
the net asset value of the Fund's shares. Should a distribution
reduce the net asset value below the shareholder's cost basis,
such distribution would, nevertheless, be taxable to the
shareholder as ordinary income or capital gain as described
above, even though, from an investment standpoint, it may
constitute a partial return of capital. In particular, investors
should be careful to consider the tax implications of buying
shares just prior to a distribution. The price of shares
purchased at that time includes the amount of the forthcoming
distribution. Those investors purchasing shares just prior to a
distribution will then receive a partial return of their
investment upon such distribution, which will, nevertheless, be
taxable to them.
DIRECTORS AND OFFICERS
The Directors are responsible for the overall
management of the Fund, including general supervision and review
of the investment activities. The Officers, who administer the
Fund's daily operations, are appointed by the Board of
Directors. The current Directors and Officers of the Company and
their affiliations and principal occupations for the past five
years are set forth below. The Company does not have any plans
in effect which provide profit sharing, pension or retirement
benefits for the Directors and Officers or which provides them
with health insurance benefits. At present, none of the
Directors will receive any fees or other compensation for serving
as Directors. The Company may determine in the future to pay
fees to the non-interested directors as well as their expenses.
Aristides M. Matsis:* 59 Chairman of the Board and a Director,
President and Treasurer of the Company. His address is 736 West
End Avenue, New York, New York 10025. He is an active private
investor and is the manager of private investment portfolios incl-
uding the management, over the past thirty five years, of private
investment trusts with investment objectives and policies similar
to those of the Fund.
Edith B. Matsis, 40 Her address is 736 West End Avenue, New York,
New York, holds a degree in business administration and manages
the office of the Fund.
* An "interested person" of the Fund as defined in the
Investment Company Act of 1940.
Frederick M. Fisher, D.D.S., Director. His address is 1498 Third
Avenue, New York, New York 10028. Dr. Fisher is in the private
practice of dentistry in New York, New York.
Jeffrey W. Newcomer,D.P.M., Director. His address is 74 Ashton
Place, Buffalo, New York. Dr. Newcomer is in private practice in
Buffalo, New York.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
Mr.Aristides M. Matsis, is a control person of the Com-
pany and principal shareholder of the Fund.
THE INVESTMENT MANAGER
Investment management services are provided to the Fund
by East End Investment Management Company (the "Manager")
pursuant to an investment management agreement dated June 28,
1995. The Investment Management Agreement will remain in effect
until June 28, 2001 unless sooner terminated, and shall continue
in effect thereafter for periods not exceeding one year so long
as such continuation is approved at least annually by (1) the
vote of a majority of the Directors of the Company including by a
majority of the non-interested Directors cast in person at a
meeting called for the purpose of voting on such approval or (2)
by a majority of the Fund's outstanding voting securities. The
Agreement may be terminated at any time, without penalty, by the
Fund or the Manager upon sixty days written notice, and is
automatically terminated in the event of its assignment as
defined in the Investment Company Act.
Mr. Aristides M. Matsis, is a Director and is President
and Treasurer and Edith B. Matsis is a Director, Vice President
and Secretary, of the Manager. Mr.Aristides M. Matsis owns 100% of
the Manager's outstanding voting securities.
The Fund is responsible for the Fund's operating
expenses including, but not limited to: the costs of portfolio
securities purchased or sold (including brokerage commissions and
referral fees to brokers, if any, for referring institutional
investors) and any losses incurred in connection with such
transactions; fees payable to or the reimbursement of expenses
incurred on behalf of the Fund by the Manager under the
Investment Management Agreement; Plan of Distribution payments;
the expenses of organizing the Company and the Fund; filing fees
and expenses relating to the registration and qualification of
the Fund's shares and the Company under federal and/or state
securities laws and maintaining such registrations and
qualifications; fees payable to the Company's Directors who are
non-interested Directors and all expenses incurred in connection
with services, including travel expenses; taxes and governmental
fees; costs of liability, fidelity and other insurance
(including directors and officers liability insurance and errors
and omissions insurance); expenses arising out any claim for
damages or other relief asserted against the Company or the Fund;
legal fees and expenses and accounting and auditing expenses;
charges of the custodian; charges of the transfer agent, pricing
agent and other agents; the expenses of setting in type, printing
and mailing prospectuses, statements of additional information,
proxy materials and shareholder reports to existing shareholders;
any extraordinary expenses (including any expenses the Company
may incur as a result of its involvement in any action, suit or
proceeding or its legal obligation to provide indemnification to
its officers, directors, employees and agents); fees, voluntary
assessments and other expenses incurred in connection with
membership in investment company trade organizations; the costs
of printing, mailing and tabulating proxies and the costs of
meetings of shareholders, the Board and any committees of the
Board; the cost of educational materials, informative literature
and other publications provided by the Company to its Directors
and Officers in connection with the performance of their duties.
i The Manager has agreed that if, in any fiscal year, the
Fund shall qualify its shares for sale in any jurisdiction, the
applicable statutes or regulations of which expressly limit the
amount of the Fund's total annual expense's the Manager shall
defer its annual investment management fee to the extent that the
Fund's total annual expenses as a percentage of average net
assets (other than brokerage commissions, other capital items,
interest, taxes, extraordinary items and other excludable items,
charges, costs and expenses) exceed the percentage limitations
imposed on the Fund by the most stringent regulations of any such
jurisdiction, so long as the Fund remains so qualified in such
jurisdiction. There are no limitations by any state at this time
To the extent the Manager performs a service or assumes
an operating expense for which the Fund is obligated but cannot,
at the time, pay (other than services which the Manager is
obligated to perform under the Investment Management Agreement)
or defers its fee as the result of the application of a state
expense limitation requirement, the Manager is entitled to seek
reimbursement from the Fund within the following three years for
the Managers' costs incurred in rendering such service, assuming
such expense or deferring its fee.
EXECUTION OF PORTFOLIO TRANSACTIONS
Pursuant to the Investment Management Agreement, the
Manager determines which securities are to be purchased and sold
by the Company on behalf of the Fund and which broker-dealers are
eligible to execute the Fund's transactions, subject to the
instructions of and review by the Company's Board of Directors.
Purchases and sales of securities in the over-the-counter market
will generally be executed directly with a "market maker" unless,
in the opinion of the Manager or the Fund, a better price and
execution can otherwise be obtained by using a broker for the
transaction. Where possible, purchase and sale transactions will
be effected through broker-dealers (including banks) which
specialize in the types of securities which the Fund will be
holding, unless better executions are available elsewhere.
Securities may also be purchased from a broker-dealer
acting as dealer and from underwriters. Dealers and underwriters
usually act as a principal for their own account.
Purchases from dealers will include the spread between the bid
and asked price and purchases from underwriters will include a
concession paid by the issuer to the underwriter.
Investment decisions for the Fund are made independently
from those of other client accounts of the Manager.
Nevertheless, it is possible that at times identical securities
will be selected for investment by the Fund and for one or more
of such client accounts. To the extent that any client account
and the Fund are in the market for the same security at the same
time, the number of shares or amount of securities being sought
for the Fund may not be obtainable or, if obtainable, then at a
higher price. Similarly, the Fund may not be able to obtain as
high a price for, or to sell the number of shares or amount of
securities desired, at the same time.
The Fund does not deem it practicable and in its best
interests to solicit competitive bids for commission rates on
each transaction. However, consideration is regularly given to
information concerning the prevailing level of commissions
charged on comparable transactions by qualified brokers in
general.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
Payments to shareholders for shares of the Fund
redeemed directly from the Fund will be made as promptly as
possible but no later than seven days after receipt by the
Fund's Transfer Agent of the written request in proper form,
with the appropriate documentation as stated in the Fund's
Prospectus, except that the right of redemption may be suspended
or the date of payment postponed during any period when (a)
trading on the New York Stock Exchange is restricted as
determined by the Securities and Exchange commission or such
exchange is closed for other than weekends or holidays; (b) an
emergency exists as determined by the Securities and Exchange
Commission making sales or purchases of portfolio securities or
valuation of the Fund not reasonably practicable; or (c) for such
other period as the Securities and Exchange Commission may permit
for the protection of the Fund's shareholders. At various times,
the Fund may be requested to redeem shares for which it has not
yet received confirmation of good payment; in this circumstance,
the Fund may delay the redemption until payment for the purchase
of such shares has been collected and confirmed to the Fund.
The Fund intends to pay cash (U.S. dollars) for all
shares redeemed, but, under abnormal conditions which make
payment in cash unwise, the Fund may make payment partly in its
portfolio securities. Although the Fund does not anticipate that
it will make any part of a redemption payment in securities, if
such payment were made the investor may incur brokerage costs in
converting such securities to cash. The Fund has elected to be
governed by Rule 18f-1 under the 1940 Act, which contains a
formula for determining the minimum redemption amounts that must
be paid in cash. Any portfolio securities issued for an "in
kind" redemption will be readily marketable.
The redemption proceeds may be more or less than the
investor's cost, depending on the market value of the Fund's
portfolio securities at the time of redemption.
TAX INFORMATION
Taxation of the Fund
The Fund intends to qualify and elect to be treated as
a regulated investment company under subchapter M of the Internal
Revenue Code of 1986, as amended (the "Code") for each taxable
year by complying with all applicable requirements regarding the
source of its income, the diversification of its assets, and the
timing of its distributions. The Fund's policy is to distribute
to its shareholders all of its net investment income and any net
realized capital gains for each calendar year in a manner which
complies with the distribution requirements of the Code so as to
avoid being subject to any federal income or excise taxes.
However, the Board of Directors may elect to pay any applicable
excise taxes if it determines that payment is, under the
circumstances, in the best interests of the Fund.
In order to qualify as a regulated investment company
the Fund must, among other things, (a) derive at least 90% of its
gross income from dividends, interest,payments with respect to
loans of stock and securities, gains from the sale or other
disposition of stock or securities, or other income derived with
respect to the business of investing in stock; (b) derive less
than 30% of its gross income from the sale or other disposition
of stock or securities held less than three months; and (c)
diversify its holdings so that, at the end of each fiscal
quarter, (i) at least 50% of the market value of its assets is
represented by cash, cash items, U.S. Government securities,
securities of other regulated investment companies and other
securities (provided that the securities of any one issuer shall
not exceed 5% of the Fund's assets or 10% of the voting
securities of the issuer), and (ii) not more than 5% of the
Fund's assets is invested in the securities of any one issuer
(other than U.S.Government securities or the securities of other
regulated investment companies). As such, and by complying with
the applicable provisions of the Code, the Fund will not be
subject to federal income tax on taxable income (including
realized capital gains) which is distributed to shareholders in
accordance with the timing requirements of the Code.
Investment income received by the Fund from sources
within foreign countries may be subject to foreign income taxes
withheld at the source.
Taxation of Shareholders
Distributions of net investment income and net realized
capital gains will be taxable to shareholders whether made in
cash or reinvested in shares. In determining amounts of net
realized capital gains to be distributed, any capital loss
carryover from prior years will be applied against capital
gains. Shareholders receiving distributions in the form of
additional shares will have a cost basis for federal income tax
purposes in each share so received equal to the net asset value
of a share of the Fund on the reinvestment date. Fund
distributions will also be included in individual and corporate
shareholders income on which the alternative minimum tax may be
imposed.
Distributions of net investment income (which includes
the excess of net short-term capital gain over net long-term
capital loss) will be taxed as ordinary income. A portion of the
net investment income distributions is expected to qualify for
the corporate received deduction, subject to the satisfaction by
the corporate shareholder of certain holding and debt financing
restrictions. The portion of the distribution deducted by the
corporate shareholder must be included in its adjusted
alternative minimum taxable income.
Any distributions of Fund's net long-term capital gain
in excess of its short-term capital loss is treated as long-term
capital gain regardless of the length of time the Fund's shares
have been held by the shareholder. The maximum federal income tax
rate on long-term capital gains income for individuals is
currently 20% as contrasted with a federal income tax rate of
39.6% on ordinary income distributions. For corporate
shareholders, long-term capital gains income is taxed at the same
rate as ordinary income.
Sales and redemptions of shares of the Fund may result
in gains and losses for tax purposes to the extent of the
difference between the proceeds from the shares redeemed and the
shareholder's adjusted tax basis for such shares. Any loss
realized upon the redemption of shares within six months from
their date of purchase will be treated as a long-term capital
loss to the extent of distributions of long-term capital gain
dividends during such six month period. All or a portion of a
loss realized upon the redemption of shares may be disallowed to
the extent shares are purchased (including shares acquired by
means of reinvested dividends) within 30 days before or after
such redemption.
Backup Withholding
The Fund or the securities dealer effecting a sale of
Fund shares by a shareholder will be required to file information
reports with the Internal Revenue Service ("IRS") with respect to
distributions, redemptions and other payments made to the
shareholders. In addition, the Fund will be required to withhold
20% of federal income tax on distributions, redemptions and other
payments made to accounts of individual or other tax exempt
shareholders who (i) have not furnished their correct taxpayer
identification numbers and certain required certifications on the
account application, or (ii) with respect to which the Fund or
the securities dealer has been notified by the IRS that the
number furnished is incorrect or that the account is otherwise
subject to withholding. The Fund will inform investors of the
source of their dividends and distributions at the time they are
paid, and will promptly after the cost of each calendar year
advise investors of the tax status of such distributions and
dividends.
Miscellaneous
The above discussion is not intended to be a complete
discussion of all applicable federal tax consequences of an
investment in the Fun. Distributions and the transactions
referred to in the preceding paragraphs may be subject to state
or local income taxes, and the treatment thereof may differ from
the federal income tax treatment. In particular, under the laws
of certain states, distributions of net investment income are
taxable to shareholders as dividends, even though a portion of
such distributions may be derived from interest on U.S.
Government obligations which, if received directly by such
shareholders, would be exempt from state income tax. Given the
passive nature of the income realized and distributed by the
Fund, as a very general rule, a shareholder should only be
subject to tax on Fund distributions or redemption payments in
the state in which the shareholder resides (or has its commercial
domicile in the case of a non-individual).
INDEPENDENT AUDITORS
Sanville & Company, Philadelphia, Pennsylvania, has
been selected as independent public accountants for East End
Mutual Funds, Inc. The financial statements included in the
Prospectus have been included in reliance on the report of
Sanville & Company, given on the authority of said firm as
experts in auditing and accounting.
MEASURING PERFORMANCE
Performance information provides you with a method of
measuring and monitoring your investments. East End Mutual
Funds, Inc. may quote the performance of the Capital Appreciation
Series in advertisements or shareholder communications.
Understanding performance measures:
Total return for the Capital Appreciation Series may be
calculated on an average annual total return basis or an
aggregate total return basis. Average annual total return
reflects the average annual percentage change in value of an
investment over the measuring period. Aggregate total return
reflects the total percentage change in value of an investment
over the measuring period. Both measures assume the reinvestment
of dividends and distributions.
Performance comparisons:
Yield and total return of the Capital Appreciation
Series may be compared to those of mutual funds with similar
investment objectives and to bond, stock or other relevant
indices or to rankings prepared by independent services or other
financial or industry publications that monitor mutual fund
performance.
Total return and yield data, as reported in national
financial publications such as Money Magazine, Forbes, Barron's,
The Wall Street Journal, Investor's Business Daily and The New
York Times, as well as in publications of a local or regional
nature, may be used for comparison.
The performance of The Capital Appreciation Series may
also be compared to data prepared by Lipper Analytical Services,
Inc.; Morningstar and Value Line Mutual Fund Service and total
returns for the Capital Appreciation Series may be compared to
indices such as the Dow Jones Industrial Average, the Standard &
Poor's 600 or 500 and Russell 2000 or 3000 Stock Index's, and the
NASDAQ Composite or 100 stock Index's.
Performance information:
The Prospectus contains a brief description of how performance is
calcuated quotations of average annual total return for a fund will
be expressed in terms of the average annual compounded rate of return
of a hypothetical investment in such Fund over periods of 1, 5, and
10 years (or up to the life of the Fund). These are the annual rate
of return that would equate to the initial amount invested to the end-
ing redeemable value. These rates of return are calculated pursuant
to the following formula; P(1 + T)n = ERV, (where P = a hypothetical
initial payment of $1,000, T = the average annual total return, n =
the number of years and ERV = the ending redeemable value of a hypo-
thetical $1,000 payment made at the beginning of the period). All
total return figures reflect the deduction of a proportional share of
Fund expenses on an annual basis, and assume that all dividends and
distributions are reinvested when paid. The average annual total
return of the Fund computed for year ended June 30,2000 was 106.69%.
Financial Statements:
The following audited finacial statements for the period ended June
30, 2000 are hereby incorporated into this SAI by reference to the
Funds Annual Report dated June 30, 2000. A copy of such report ac-
companies this statement of Additional Information.
Documents Incorporated by Reference to the Annual report:
Schedules of Investments as of June 30, 2000
Statement of Operations for the period ended June 30, 2000
Statement of Assets and liabilities as of June 30, 2000
Statement of Changes in Net assets year ended June 30, 2000
Financial Highlights for the life of the Fund
Notes to Financial Statements
Report of Independent Accountants
The portions of such Annual Report that are not specifically listed
above are not incorporated by reference into this Statement of e vAdd-
itional Informanton and are not part of the Registration Statement.
Dated: September 13,2000
New York, New York
Form 24F-2
Annual Notice of Securities Sold Pursuant to Rule 24F-2
1. Name and address of issuer:
East End Mutual Funds, Inc.
736 West End Avenue, Ste. 3A
New York, New York 10025
2. Name of each series or class of funds for which notice
is filed.
Capital Appreciation
3. Investment Company Act File Number: 811-8408
Securities Act File Number: 33-80020
4. Last day of fiscal year this notice is filed: June 30
5. Check box if this notice is being filed more than 180 days
after the close of the issuer's fiscal year for purposes of
reporting securities sold after the close of the fiscal year
but before the termination of the issuer's 24f-2 declaration:
No
6. Date of termination of issuer's declaration under Rule 24f-2
(a)(1), if applicable:
Not Applicable
7. Number and amount of securities of the same class or series
which had been registered under the Securities Act of 1933
other than pursuant to rule 24f-2 in a prior fiscal year but
which remained unsold at the beginning of the fiscal year:
Not applicable.
8. Number and amount of securities registered during the fiscal
year other than pursuant to rule 24f-2:
Not Applicable.
9. Number and aggregate sale price of securities sold during the
fiscal year:
103.840, $2,000.00
10.Number and aggregate sale price of securities sold during the
fiscal year in reliance upon registration pursuant to rule 24f-2:
103.840, $2,000.00
11. Number and aggregate sale price of securities issued during
the fiscal year in connection with dividend reimbursement
plans if applicable:
Not Applicable.
12. Calculation of registration fee:
(i) Aggregate sale price of securities sold during the fiscal
year in reliance on rule 24f-2 (from item 10):
$ 2,000.00
(ii) Aggregate price of shares issued in connection with div-
idend reinvestment plans (from item 11 if applicable):
0
(iii) Aggregate price of shares redeemed or repurchased during
the fiscal year(if applicable)
$2,500.00
(iv) Aggregate price of shares redeemed or repurchased and
applied as a reduction to filing fees pursuant to rule 24f-2
(if applicable):
$2,500.00
(v) Net aggregate price of securities sold and issued during
the fiscal ayear in reliance of rule 24f-2[line (i) plus line
(ii), less line (iii), plus line (iv) (if applicable):
($500.00)
(vi) Multiplier prescribed by Section 6(b) of the Securities
Act of 1933 or other applicable law or regulation:
1/2900
(vii) Fee due [line (i) or line (vii):
$ 0
13. Check box if fees are being remitted to the Commission's
lockbox depository as described in Section 3a of the Comm-
ission's Rules of Informal and Other procedures (17CFR 202
.3a:
No fees due
Date of mailing or wire transfer of filing fees to the
Commission's lockbox depository:
No fees due
SIGNATURES
This report has been signed below by the following persons on
behalf of the issuer and in the capacity and on the dates indicated.
By: /s/Aristides Matsis
Aristides Matsis, President
Date 9/13/2000
2
MINUTES OF A SPECIAL MEETING OF THE BOARD
TO APPROVE FIDELITY BOND OF
EAST END MUTUAL FUNDS, INC.
MINUTES of the meeting, duly called, of the Board of Directors of
East End Mutual Funds, Inc. a Maryland corporation, held on the
26th day of June, 2000 at 736 West End Avenue, Suite 3A New
York, New York at 6:30 PM.
The President of the Corporation called the meeting to order.
The Secretary called the roll and the following Independent
Directors were found present: Editha Matsis, Dr. Fred Fisher and
Dr. Jeffrey Newcomer.
The Secretary reported that Notice of the time and place of
holding the meeting was given to each Director by mail in
accordance with the By-Laws.
On motion duly made and carried, the notice was ordered filed.
The President then stated that a quorum was present and the
meeting was ready to transact business.
The minutes of the preceding meeting of the Board, held on the
27th. day of June 1999 were read and adopted.
The President presented his report.
WHEREAS this Corporation must pursuant to Rule 17g-1 of the 1940
Act approve the fidelity bond originally issued National Union
Fire in the amount of $50,000 in favor of East End Mutual Funds,
Inc. solely, of which the premium has been prepaid to September,
14, of 2000.
Now therefore it is resolved that the Corporation by the majority
of its Independent Directors unanimously approves said bond.
On motion duly made and carried, the same was received and
ordered to be filed.
There being no further business before the meeting, on motion
duly made, seconded and carried, the meeting was adjourned.
IN WITNESS WHEREOF, I have hereunto set my hand on this 26th. day
of June, 2000.
/s/Editha B.Matsis, Secretary
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