As filed with the Securities and Exchange Commission on June 2, 2006
Registration No. 333-131940/811-05084
U.S. Securities and Exchange Commission
Washington, DC 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. 2 Post-Effective Amendment No. ___
(Check appropriate box or boxes)
Exact Name of Registrant as Specified in Charter:
MUTUAL OF AMERICA INVESTMENT CORPORATION
Area Code and Telephone Number:
(212) 224-1600
Address of Principal Executive Offices:
320 Park Avenue, New York, New York 10022
Name and Address of Agent for Service:
Manfred Altstadt
Chairman, President and CEO
Mutual of America Investment Corporation
320 Park Avenue
New York, New York 10022
Copies to:
Thomas L. Martin
Senior Vice President and Secretary
Mutual of America Life Insurance Company
320 Park Avenue
New York, New York 10022
Approximate Date of Proposed Public Offering: As soon as practicable after the
Registration Statement becomes effective under the Securities Act of 1933.
Title of securities being registered: Shares of beneficial interest in the Registrant’s Mid-Term Bond Fund
Calculation of Registration Fee under the Securities Act of 1933: No filing fee is required in reliance on Section 24(f) under the Investment Company Act of 1940, as amended.
Short-Term Bond Fund
320 Park Avenue, New York, New York 10022
Variable Life Insurance Policy Owner:
1. | Following the reorganization, the Mid-Term Bond Fund is expected to have an aggregate operating expense ratio that is no higher than that of the Short-Term Bond Fund currently. |
2. | If you would rather not remain in the Mid-Term Bond Fund after the merger, you may transfer all or a part of your interest in the Mid-Term Bond Fund as provided in your contract to another available investment option on each day the Investment Company is open for business at the then current net asset value per share. Currently, transfers are not subject to charges or limits except there are limitations with respect to frequent purchases and redemptions. |
Short-Term Bond Fund
320 Park Avenue, New York, New York 10022
Variable Life Insurance Policy Owner:
1. | Following the reorganization, the Mid-Term Bond Fund is expected to have an aggregate operating expense ratio that is no higher than that of the Short-Term Bond Fund currently. |
2. | If you would rather not remain in the Mid-Term Bond Fund after the merger, you may transfer all or a part of your interest in the Mid-Term Bond Fund as provided in your contract to another available investment option on each day the Investment Company is open for business at the then current net asset value per share. Currently, transfers are not subject to charges or limits, except there are limitations with respect to frequent purchases and redemptions. |
New York, New York 10022
the Short-Term Bond Fund:
ITEM 1. | To approve or disapprove a Plan of Reorganization (the “Plan”) whereby the Short-Term Bond Fund will be merged with and into the Mid-Term Bond Fund, a series of the Investment Company (the “Mid-Term Bond Fund”). The Plan contemplates (a) the sale of substantially all of the assets and liabilities of the Short-Term Bond Fund to the Mid-Term Bond Fund in exchange for shares of the Mid-Term Bond Fund, and (b) the distribution of such shares of the Mid-Term Bond Fund to the shareholders of the Short-Term Bond Fund in connection with the liquidation of the Short-Term Bond Fund. |
ITEM 2. | To transact such other business as may properly come before the Special Meeting or any adjournment(s) thereof. |
New York, New York
dated June 9, 2006
Short-Term Bond Fund
Mid-Term Bond Fund
320 Park Avenue
New York, New York 10022
(800) 468-3785
America separate accounts, the “separate accounts”), is the legal owner of 0.01% of the shares of the Short-Term Bond Fund. American Life and Mutual of America are referred to herein as the “Insurance Companies”, or if singular, an “Insurance Company”.
Page | ||||||
Introduction | 5 | |||||
Summary | 5 | |||||
Risk Factors | 9 | |||||
Comparative Fee and Expense Table | 11 | |||||
Information Relating to the Proposed Reorganization | 12 | |||||
Federal Income Tax Consequences | 16 | |||||
Capitalization | 17 | |||||
Comparison of Investment Objective and Policies | 18 | |||||
Mid-Term Bond Fund Financial Highlights | 19 | |||||
Summary of Information about the Investment Company Generally | 20 | |||||
Voting Information | 21 | |||||
Additional Information about the Funds | 23 | |||||
Other Business | 24 | |||||
Litigation | 24 | |||||
Shareholder Inquiries | 24 | |||||
Appendix A — Plan of Reorganization | A-1 | |||||
Appendix B — Mid-Term Bond Fund Prospectus dated May 1, 2006 | B-1 |
or loss will be recognized by the variable contract owners as a result of the Reorganization. See “Information Relating to the Proposed Reorganization.”
Bond Fund to the holding period and tax basis in the hands of the Short-Term Bond Fund immediately prior to the Reorganization. Also, the variable contract owners will not recognize any gain or loss as a result of the Reorganization. See “Information Relating to the Proposed Reorganization — Federal Income Tax Consequences” below.
Investment Approach | ||||||
---|---|---|---|---|---|---|
Short-Term Bond Fund | Invests primarily in publicly-traded, investment-grade debt securities, and in corporate, U.S. Government securities and U.S. Government agency securities and money market instruments, such as bonds, notes, mortgage-backed securities and commercial paper. May have a significant portion of its assets in a particular debt security, such as U.S. Government or agency securities, which also may be mortgage-backed securities. | |||||
Mid-Term Bond Fund | Invests primarily in publicly-traded, investment-grade debt securities, and in corporate, U.S. Government securities and U.S. Government agency securities, such as bonds, notes, debentures, zero coupon securities and mortgage-backed securities. May have a significant portion of its assets in a particular debt security, such as U.S. Government agency securities, zero coupon securities or securities rated BBB or higher. |
• | Each Fund has market risk — the value of your investment will go up or down depending on movements in the bond markets. As a result, you may lose money from your investment, or your investment may increase in value. |
• | The investment results for a particular Fund may be better or worse than the results for the comparable bond market taken as a whole, depending on the type of debt securities in which the Fund invests and the portion of the Fund invested in debt securities. |
• | The investment results for a particular Fund may be better or worse than the results of other funds that invest in the same types of securities. In other words, security selection by a Fund’s investment adviser will impact the Fund’s performance. |
• | Changes in prevailing interest rates usually will impact the value of debt securities. The longer the time period before the security matures (or is expected to be redeemed), the more impact interest rate changes will have on the price of the bond. When interest rates rise, the prices of outstanding debt securities tend to fall. When interest rates fall, the prices of outstanding debt securities tend to rise. |
• | Mortgage-backed securities or certificates are subject to prepayment or extension risk when interest rates change. When interest rates fall, the underlying mortgages may be prepaid at a faster rate than previously assumed in pricing the mortgage-backed security, which would shorten the period to maturity of the security. When interest rates rise, the underlying mortgages may be prepaid at a slower rate than previously assumed, which would lengthen the period to maturity of the security. |
• | In periods of economic uncertainty, investors may favor U.S. government debt securities over debt securities of corporate issuers, in which case the value of corporate debt securities would decline in relation to the value of U.S. government debt securities. |
• | Zero coupon securities and discount notes do not pay interest, and they may fluctuate more in market value and be more difficult for a Fund to resell during periods of interest rate changes than other securities with comparable maturities that pay interest in cash at regular intervals. In addition, the Fund may lose a portion of the principal amount of a zero coupon security if it sells the security after an increase in interest rates. |
• | Unrated securities or securities rated below investment grade may be subject to a greater market risk than higher rated (lower yield) securities. Since lower rated and unrated securities are generally issued by corporations that are not as creditworthy or financially secure as issuers of higher rated securities, there is a greater risk that issuers of lower rated (higher yield) securities will not be able to pay the principal and interest due on such securities, especially during periods of adverse economic conditions. |
• | The market for debt securities may be subject to significant volatility, and volatility has generally increased in recent years. |
| Short-Term Bond Fund | | Mid-Term Bond Fund | | Mid-Term Bond Fund (pro forma including the Short-Term Bond Fund | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Shareholder Fees (fees paid directly from your investment) | N/A | N/A | N/A | |||||||||||
Annual Fund Operating Expenses (expenses that are deducted from Fund assets) | ||||||||||||||
Management Fees** | 0.40 | % | 0.40 | % | 0.40 | % | ||||||||
Distribution (12b-1) Fees | NONE | NONE | NONE | |||||||||||
Other Expenses | 0.33 | % | 0.16 | % | 0.16 | % | ||||||||
Total Annual Fund Operating Expenses | 0.73 | % | 0.56 | % | 0.56 | % |
* | Capital Management had contractually agreed beginning as of January 1, 2003 to limit each Fund’s total operating expenses (excluding taxes, brokerage commissions, extraordinary expenses and other fees related to portfolio transactions) to its investment management fees. Capital Management had voluntarily limited the Funds’ expenses since the inception of each Fund, prior to providing the contractual expense limitation commencing January 1, 2003. This contractual obligation remained in effect for the year 2005; however, as a result of the Capital Management’s written notice of termination under the terms of the Agreement as amended, it terminated at midnight on April 30, 2006. As a result, effective May 1, 2006, the Investment Company is no longer reimbursed by Capital Management for any of its expenses. During 2005, total operating expenses as a percentage of net assets before the related expense reimbursement was 0.33% for the Short-Term Bond Fund and 0.16% for the Mid-Term Bond |
Fund. On a pro forma basis, the 2005 expenses before the related expense reimbursement would be expected to be 0.16% for the Mid-Term Bond Fund. |
** | Capital Management’s investment advisory agreement was renewed by the Investment Company Board at its February 24, 2006 meeting, and as part of such renewal the management fees were reduced by 0.10% for each of the Funds. As a result, effective May 1, 2006 the management fees for the Mid-Term Bond Fund and the Short-Term Bond Fund have been reduced from 0.50% to 0.40% of the average daily net assets of the respective Fund. |
• | you invest $10,000; |
• | you sell all of your shares at the end of the period; |
• | your investment has a 5% return each year; and |
• | each Fund’s operating expenses remain the same as shown above. |
| 1 Year | | 3 Years | | 5 Years | | 10 Years | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Short-Term Bond Fund | $ | 75 | $ | 236 | $ | 413 | $ | 941 | ||||||||||
Mid-Term Bond Fund | $ | 57 | $ | 181 | $ | 317 | $ | 722 | ||||||||||
Pro Forma of the Mid-Term Bond Fund including the Short-Term Bond Fund | $ | 57 | $ | 181 | $ | 317 | $ | 722 |
for the transfer of the assets and the assumption of the liabilities, the Investment Company will issue at the closing full and fractional shares of the Mid-Term Bond Fund equal in aggregate dollar value to the aggregate net asset value of full and fractional outstanding shares of the Short-Term Bond Fund as determined at the Valuation Time specified in the Reorganization Plan. The Reorganization Plan provides that the Short-Term Bond Fund will declare a dividend or dividends and/or other distributions on or as soon as practicable prior to the Closing Date which will have the effect of distributing to shareholders all of its investment company taxable income (computed without regard to any deduction for dividends paid) and realized net capital gain, if any, for the current taxable year through the Closing Date.
Bond Fund will, at least for a period of time, continue operations as a separate series of the Investment Company, and the Board of Directors may consider alternatives to the Reorganization in the best interests of shareholders.
1. | the transfer to the Mid-Term Bond Fund of all or substantially all of the assets of the Short-Term Bond Fund in exchange solely for shares of the Mid-Term Bond Fund and the assumption by the Mid-Term Bond Fund of all of the liabilities of the Short-Term Bond Fund, followed by the distribution of the Mid-Term Bond Fund Shares to the holders of shares of the Short-Term Bond Fund in exchange for their shares of the Short-Term Bond Fund in complete liquidation of the Short-Term Bond Fund, will constitute a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code (the “Code”), and the Mid-Term Bond Fund and the Short-Term Bond Fund will each be “a party to a reorganization” within the meaning of Section 368(b) of the Code; |
2. | no gain or loss will be recognized by the Short-Term Bond Fund upon the transfer of the Short-Term Bond Fund’s assets to the Mid-Term Bond Fund solely in exchange for the Mid-Term Bond Fund Shares and the assumption by the Mid-Term Bond Fund of liabilities of the Short-Term Bond Fund or upon the distribution of the Mid-Term Bond Fund Shares to the shareholders of the Short Term Bond Fund. |
3. | the Mid-Term Bond Fund’s basis in the assets and liabilities received from the Short-Term Bond Fund will be the same as the Short-Term Bond Fund’s basis in such assets and liabilities immediately prior to the transfer; |
4. | the Mid-Term Bond Fund’s holding period for the transferred assets will include the period during which such assets were held by the Short-Term Bond Fund; |
5. | no gain or loss will be recognized by the Mid-Term Bond Fund upon the receipt of the assets of the Short-Term Bond Fund in exchange for shares of the Mid-Term Bond Fund and the assumption by the Mid-Term Bond Fund of the liabilities of the Short-Term Bond Fund; |
6. | no gain or loss will be recognized by the shareholders of the Short-Term Bond Fund on the exchange of their shares of the Short-Term Bond Fund solely for shares of the Mid-Term Bond Fund; |
7. | a Short-Term Bond Fund shareholder’s basis in the Mid-Term Bond Fund shares received in the Reorganization will be the same as the adjusted basis of the shares of the Short-Term Bond Fund exchanged therefor; |
8. | a Short-Term Bond Fund shareholder’s holding period in the shares of the Mid-Term Bond Fund received in the Reorganization will include the shareholder’s holding period for the shares of the Short-Term Bond Fund exchanged therefor, provided that such Short-Term Bond Fund shares were held as capital assets on the Closing Date. |
9. | the Mid-Term Bond Fund will succeed to and take into account the items of the Short-Term Bond Fund described in Section 381(c) of the Code, including any earnings or profits, or deficit therein, of the Short-Term Bond Fund as of the Closing Date, subject to the conditions and limitations specified in Sections 381, 382, 383 and 384 of the Code; and |
10. | no gain or loss will be recognized by variable contract owners as a result of the Reorganization. |
| Short-Term Bond Fund | | Mid-Term Bond Fund | | Pro Forma Mid-Term Bond Fund* | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Total Net Assets | $ | 38,314,760 | $ | 71,443,254 | $ | 109,758,014 | ||||||||
Shares Outstanding | 37,748,047 | 77,559,677 | 119,154,653 | |||||||||||
Net Asset Value Per Share | $ | 1.02 | $ | 0.92 | $ | 0.92 |
* | The pro forma net asset value reflects the increased number of shares due to the merger. |
| Year ended December 31, 2005 | |||||
---|---|---|---|---|---|---|
MID-TERM BOND FUND | ||||||
Net Asset Value, Beginning of Period | $ | 0.94 | ||||
Income (Loss) From Operations: | ||||||
Net investment income | 0.03 | |||||
Net realized and unrealized loss | (0.02 | ) | ||||
Total Income From Operations | 0.01 | |||||
Less Distributions From: | ||||||
Net investment income | (0.03 | ) | ||||
Net realized gains | — | |||||
Total Distributions | (0.03 | ) | ||||
Net Asset Value, End of Period | $ | 0.92 | ||||
Total Return | 0.77 | % | ||||
Net Assets, End of Period (000’s) | $ | 71,443 | ||||
Ratios to Average Net Assets: | ||||||
Expenses after reimbursement (1) | 0.50 | % | ||||
Net investment income | 3.30 | % | ||||
Fund Turnover Rate | 21.99 | % |
(1) | As a result of a contractual expense reimbursement effective through April 30, 2006, the ratio of expenses to average net assets is limited to the Fund’s investment advisory fee. The expense ratio before the Adviser’s expense reimbursement to the Fund was 0.66%. |
ABOUT THE INVESTMENT COMPANY GENERALLY
the Insurance Company has the right to disregard voting instructions from certain variable contract owners. The Insurance Companies do not believe that these circumstances exist with respect to matters currently before shareholders and variable contract owners. Variable contract owners may revoke previously submitted voting instructions given to an Insurance Company by notifying the Insurance Company in writing at any time before 5:00 p.m. (Eastern time) on July 13, 2006 or by attending and voting in person at the Meeting. Mutual of America or Capital Management will bear all of the expenses of soliciting voting instructions. The solicitation will be made primarily by mail, but the Insurance Companies and their affiliates may make telephone, electronic, or oral communications to variable contract owners.
Name and Address | | Fund | | Percentage of Fund Owned on Record Date | | Percentage of the Mid-Term Bond Fund Ownership Upon Consummation | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Head Start Sponsoring Board Council of the City of New York, Inc. 45 Main Street Suite 712 Brooklyn, NY 11201 | Short Term Bond Fund | 14.12% | 5.02% | |||||||||||
United Way of Greater Toledo 1 Stranahan Sq Ste 114 Toledo, OH 43604-1467 | Short Term Bond Fund | 10.47% | 3.72% |
20549 or by electronic request to publicinfo@sec.gov, and is also available on the SEC’s web site at http://www.sec.gov.
1. | THE REORGANIZATION |
state securities commission, and any federal, state or local tax authorities or any other relevant regulatory authority, is and shall remain the responsibility of the Merging Fund or the Investment Company on behalf of the Merging Fund.
2. | VALUATION |
3. | CLOSING AND CLOSING DATE |
4. | REPRESENTATIONS AND WARRANTIES |
its business as it is now being conducted. The Merging Fund has been duly established as a series of the Investment Company.
incurrence by the Merging Fund of indebtedness maturing more than one year from the date such indebtedness was incurred except as otherwise disclosed to and accepted in writing by the Acquiring Fund. For purposes of this subsection (f), a decline in net asset value per share of the Merging Fund due to declines in market values of securities in the Merging Fund’s portfolio, the discharge of Merging Fund liabilities, or the redemption of Merging Fund Shares by Merging Fund Shareholders shall not constitute a material adverse change.
restrictions as to which the Investment Company, on behalf of the Acquiring Fund, has received notice and necessary documentation at or prior to the Closing.
Investment Company on behalf of the Acquiring Fund result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease, judgment or decree to which the Acquiring Fund is a party or by which it is bound.
5. | INTENTIONS |
6. | CONDITIONS PRECEDENT TO BE FULFILLED BY THE INVESTMENT COMPANY |
there shall be (i) no pending or threatened litigation brought by any person against the Investment Company, the Merging Fund, or the Acquiring Fund, or the advisers, trustees, or officers of any of the foregoing, arising out of this Plan and (ii) no facts are known to the Investment Company, the Merging Fund, or the Acquiring Fund, that any of such persons reasonably believes might result in such litigation.
within the meaning of Section 368(a) of the Code, and the Acquiring Fund and the Merging Fund will each be “a party to a reorganization” within the meaning of Section 368(b) of the Code; (ii) no gain or loss will be recognized by the Merging Fund upon the transfer of the Merging Fund’s assets to the Acquiring Fund solely in exchange for the Acquiring Fund Shares and the assumption by the Acquiring Fund of liabilities of the Merging Fund or upon the distribution of the Acquiring Fund Shares to the Shareholders of the Merging Fund; (iii) the Acquiring Fund’s basis in the assets received from the Merging Fund will be the same as the Merging Fund’s basis in such assets immediately prior to the transfer; (iv) the Acquiring Fund’s holding period for the transferred assets will include the period during which such assets were held by the Merging Fund; (v) no gain or loss will be recognized by the Acquiring Fund upon the receipt of the assets of the Merging Fund in exchange for Acquiring Fund Shares and the assumption by the Acquiring Fund of the liabilities of the Merging Fund; (vi) no gain or loss will be recognized by the Shareholders of the Merging Fund on the exchange of their shares of the Merging Fund solely for shares of the Acquiring Fund; (vii) a Merging Fund shareholder’s basis in the Acquiring Fund Shares received in the Reorganization will be the same as the adjusted basis of the shares of the Merging Fund exchanged therefor; (viii) a Merging Fund shareholder’s holding period in the Acquiring Fund Shares received in the Reorganization will include the shareholder’s holding period for the shares of the Merging Fund exchanged therefor, provided that the shares of the Merging Fund were held as capital assets on the Closing Date; (ix) the Acquiring Fund will succeed to and take into account the items of the Merging Fund described in Section 381(c) of the Code, including any earnings or profits, or deficit therein, of the Merging Fund as of the Closing Date, subject to the conditions and limitations specified in Sections 381, 382, 383 and 384 of the Code; and (x) no gain or loss will be recognized as a result of the Reorganization by owners of variable annuity contracts or variable life insurance policies whose assets have been allocated to the Funds. The delivery of such opinion is conditioned upon receipt by Sutherland Asbill & Brennan LLP of representations it shall request of each Fund. Notwithstanding anything herein to the contrary, neither party may waive the condition set forth in this Section 6.11.
7. | FEES AND EXPENSES |
8. | ENTIRE PLAN; SURVIVAL OF WARRANTIES |
9. | TERMINATION |
10. | AMENDMENTS |
11. | NOTICES |
12. | HEADINGS; GOVERNING LAW; LIMITATION OF LIABILITY |
Attest: | Mutual of America Investment Corporation on behalf of the Short-Term Bond Fund | |||||
By: Name: Title: | ||||||
Attest: | Mutual of America Investment Corporation on behalf of the Mid-Term Bond Fund | |||||
By: Name: Title: |
June 9, 2006
Short-Term Bond Fund
Mid-Term Bond Fund
New York, New York 10022
(800)
GENERAL INFORMATION | 2 | |||||
FINANCIAL STATEMENTS | 3 |
MID-TERM BOND FUND
PRO FORMA STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
December 31, 2005
| Short-Term Bond Fund | | Mid-Term Bond Fund | | Pro Forma Adjustments (2) | | Mid-Term Bond Fund (Pro Forma) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
ASSETS: | ||||||||||||||||||
Investments at market value (Cost: Short-Term Bond Fund — $38,761,338 Mid-Term Bond Fund — $72,356,925 | ||||||||||||||||||
Mid-Term Bond Fund (Pro Forma) — $111,118,263) | $ | 38,254,204 | $ | 70,582,376 | $ | — | $ | 108,836,580 | ||||||||||
Cash | 7,812 | 7,943 | — | 15,755 | ||||||||||||||
Interest and dividends receivable | 240,241 | 852,935 | — | 1,093,176 | ||||||||||||||
Receivable for securities sold | 7,048 | — | — | 7,048 | ||||||||||||||
TOTAL ASSETS | 38,509,305 | 71,443,254 | — | 109,952,559 | ||||||||||||||
LIABILITIES: | ||||||||||||||||||
Payable for securities purchased | 194,545 | — | — | 194,545 | ||||||||||||||
NET ASSETS | $ | 38,314,760 | $ | 71,443,254 | $ | — | $ | 109,758,014 | ||||||||||
NUMBER OF SHARES OUTSTANDING | 37,748,047 | 77,559,677 | 3,846,929 | 119,154,653 | ||||||||||||||
NET ASSET VALUES, offering and redemption price per share | $ | 1.02 | $ | 0.92 | $ | 0.92 | ||||||||||||
COMPONENTS OF NET ASSETS: | ||||||||||||||||||
Paid-in capital | $ | 39,102,215 | $ | 73,508,365 | $ | — | $ | 112,610,580 | ||||||||||
Accumulated undistributed net investment income | 19,325 | 48,373 | — | 67,698 | ||||||||||||||
Accumulated undistributed net realized gain (loss) on investments | (299,646 | ) | (338,934 | ) | — | (638,580 | ) | |||||||||||
Unrealized appreciation (depreciation) of investments | (507,134 | ) | (1,774,550 | ) | — | (2,281,684 | ) | |||||||||||
NET ASSETS | $ | 38,314,760 | $ | 71,443,254 | $ | — | $ | 109,758,014 |
MID-TERM BOND FUND
PRO FORMA STATEMENT OF OPERATIONS (Unaudited)
For the Year Ended December 31, 2005
| Short-Term Bond Fund | | Mid-Term Bond Fund | | Pro Forma Adjustments (3) | | Mid-Term Bond Fund (Pro Forma) | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
INVESTMENT INCOME AND EXPENSES: | |||||||||||||||||||
Income: | |||||||||||||||||||
Dividends | $ | — | $ | — | $ | — | $ | — | |||||||||||
Interest | 1,030,890 | 2,719,427 | — | 3,750,317 | |||||||||||||||
Total income | 1,030,890 | 2,719,427 | — | 3,750,317 | |||||||||||||||
Expenses: | |||||||||||||||||||
Investment advisory fees | 166,397 | 357,306 | — | 523,703 | |||||||||||||||
Accounting and recordkeeping expenses | 72,386 | 56,325 | (7,239 | ) | 121,472 | ||||||||||||||
Shareholders reports | 18,063 | 37,385 | (903 | ) | 54,545 | ||||||||||||||
Custodian expenses | 14,312 | 8,276 | (7,156 | ) | 15,432 | ||||||||||||||
Independent Directors’ fees and expenses | 2,474 | 5,120 | 7,594 | ||||||||||||||||
Audit | 2,007 | 4,154 | (100 | ) | 6,061 | ||||||||||||||
Legal and other | 119 | 246 | — | 365 | |||||||||||||||
Total expenses before reimbursement | 275,758 | 468,812 | (15,398 | ) | 729,172 | ||||||||||||||
Expense reimbursement | (109,361 | ) | (111,506 | ) | 15,398 | (205,469 | ) | ||||||||||||
Net Expenses | 166,397 | 357,306 | — | 523,703 | |||||||||||||||
NET INVESTMENT INCOME | 864,493 | 2,362,121 | — | 3,226,614 | |||||||||||||||
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS: | |||||||||||||||||||
Net realized loss on investments | (58,241 | ) | (338,934 | ) | — | $ | (397,175 | ) | |||||||||||
Net unrealized depreciation of investments | (261,643 | ) | (1,517,652 | ) | — | (1,779,295 | ) | ||||||||||||
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS | (319,884 | ) | (1,856,586 | ) | — | (2,176,470 | ) | ||||||||||||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 544,609 | $ | 505,535 | $ | — | $ | 1,050,144 |
Notes to Pro Forma Financial Statements as of and for the Year Ended December 31, 2005 (Unaudited)
1. | BASIS OF PRESENTATION |
2. | PRO FORMA ADJUSTMENT TO STATEMENT OF ASSETS AND LIABILITIES |
3. | PRO FORMA ADJUSTMENTS TO STATEMENT OF OPERATIONS |
Accounting and recordkeeping expenses — A 10 percent reduction in the Short-Term Bond Fund expense to reflect the anticipated lower number of securities that will be held in the combined portfolio. |
Shareholders reports — A five percent reduction in the Short-Term Bond Fund expense to reflect the elimination of one fund in the semi-annual and annual reports. |
Custodian expenses — A 50 percent reduction in the Short-Term Bond Fund expense to reflect the elimination of a custodian account and a reduction in portfolio transactions as a result of the lower number of securities that will be held in the combined portfolio. |
Audit — A five percent reduction in the Short-Term Bond Fund expense to reflect the reduction in audit work. |
(MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
U.S. GOVERNMENT (12.3%) | |||||||||||||||||||||||
U.S. Treasury Note | AAA | 5.00 | 08/15/11 | 3,000,000 | 3,096,444 | ||||||||||||||||||
U.S. Treasury Note | AAA | 4.00 | 11/15/12 | 2,000,000 | 1,956,954 | ||||||||||||||||||
U.S. Treasury Strip | AAA | 0.00 | 11/15/12 | 5,000,000 | 3,705,385 | ||||||||||||||||||
8,758,783 | |||||||||||||||||||||||
U.S. GOVERNMENT AGENCIES (52.3%) | |||||||||||||||||||||||
MORTGAGE-BACKED OBLIGATIONS (4.3%) | |||||||||||||||||||||||
FHLMC | AAA | 8.00 | 07/15/06 | 3,228 | 3,223 | ||||||||||||||||||
FHLMC | AAA | 7.00 | 02/01/14 | 49,786 | 52,142 | ||||||||||||||||||
FHLMC | AAA | 5.00 | 06/15/17 | 3,000,000 | 2,990,922 | ||||||||||||||||||
FNMA | AAA | 7.00 | 04/25/07 | 23,789 | 23,964 | ||||||||||||||||||
3,070,251 | |||||||||||||||||||||||
NON-MORTGAGE-BACKED OBLIGATION (48.0%) | |||||||||||||||||||||||
FHLB | AAA | 2.75 | 03/14/08 | 4,750,000 | 4,556,281 | ||||||||||||||||||
FHLB | AAA | 5.75 | 05/15/12 | 4,500,000 | 4,738,464 | ||||||||||||||||||
FHLMC | AAA | 6.63 | 09/15/09 | 5,000,000 | 5,312,210 | ||||||||||||||||||
FHLMC | AAA | 5.63 | 03/15/11 | 4,000,000 | 4,157,756 | ||||||||||||||||||
FNMA | AAA | 3.25 | 01/15/08 | 5,000,000 | 4,857,215 | ||||||||||||||||||
FNMA | AAA | 3.25 | 02/15/09 | 1,500,000 | 1,436,718 | ||||||||||||||||||
FNMA | AAA | 6.63 | 09/15/09 | 5,500,000 | 5,848,376 | ||||||||||||||||||
FNMA | AAA | 4.38 | 09/15/12 | 3,500,000 | 3,419,896 | ||||||||||||||||||
34,326,916 | |||||||||||||||||||||||
BASIC MATERIALS (1.7%) | |||||||||||||||||||||||
International Paper Co. | BBB | 4.25 | 01/15/09 | 250,000 | 242,632 | ||||||||||||||||||
Intl. Flavors & Fragrances | BBB+ | 6.45 | 05/15/06 | 250,000 | 251,194 | ||||||||||||||||||
Monsanto Co. | A– | 4.00 | 05/15/08 | 500,000 | 489,267 | ||||||||||||||||||
Worthington Industries, Inc. | BBB | 6.70 | 12/01/09 | 250,000 | 264,488 | ||||||||||||||||||
1,247,581 | |||||||||||||||||||||||
CONSUMER, CYCLICAL (5.4%) | |||||||||||||||||||||||
Caterpillar Fin. Svc. | A | 2.63 | 01/30/07 | 500,000 | 488,490 | ||||||||||||||||||
Cox Communications, Inc. Cl A | BBB– | 3.88 | 10/01/08 | 500,000 | 481,849 | ||||||||||||||||||
Daimlerchrysler | BBB | 4.05 | 06/04/08 | 250,000 | 243,374 | ||||||||||||||||||
Harman International Industries, Inc. | BBB+ | 7.13 | 02/15/07 | 186,000 | 188,818 | ||||||||||||||||||
May Dept Stores Co. | BBB | 4.80 | 07/15/09 | 250,000 | 246,514 | ||||||||||||||||||
Newell Rubbermaid | BBB+ | 4.63 | 12/15/09 | 500,000 | 488,921 | ||||||||||||||||||
Pulte Homes, Inc. | BBB– | 4.88 | 07/15/09 | 250,000 | 244,897 | ||||||||||||||||||
Scholastic Corp. | BBB– | 5.00 | 04/15/13 | 250,000 | 230,018 | ||||||||||||||||||
Stanley Works | A | 3.50 | 11/01/07 | 250,000 | 244,043 | ||||||||||||||||||
Target Corp. | A+ | 5.38 | 06/15/09 | 1,000,000 | 1,014,725 | ||||||||||||||||||
3,871,649 |
(MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
CONSUMER, NON-CYCLICAL (3.8%) | |||||||||||||||||||||||
Campbell Soup Co. | A | 5.50 | 03/15/07 | 500,000 | 502,015 | ||||||||||||||||||
Coca-Cola Enterprises | A | 2.50 | 09/15/06 | 500,000 | 491,353 | ||||||||||||||||||
General Mills, Inc. | BBB+ | 2.63 | 10/24/06 | 500,000 | 489,618 | ||||||||||||||||||
Kellogg Co. | BBB+ | 2.88 | 06/01/08 | 500,000 | 476,383 | ||||||||||||||||||
Safeway, Inc. | BBB– | 4.13 | 11/01/08 | 500,000 | 484,160 | ||||||||||||||||||
Wal-Mart Stores, Inc. | AA | 6.88 | 08/10/09 | 250,000 | 266,069 | ||||||||||||||||||
2,709,598 | |||||||||||||||||||||||
ENERGY (1.0%) | |||||||||||||||||||||||
Anadarko Petroleum Corp. | BBB+ | 3.25 | 05/01/08 | 500,000 | 481,510 | ||||||||||||||||||
Ocean Energy, Inc. | BBB | 4.38 | 10/01/07 | 250,000 | 247,166 | ||||||||||||||||||
728,676 | |||||||||||||||||||||||
FINANCIAL (16.5%) | |||||||||||||||||||||||
American Express Credit Corp. | A+ | 3.00 | 05/16/08 | 250,000 | 239,590 | ||||||||||||||||||
American Honda Finance | A+ | 3.85 | 11/06/08 | 500,000 | 486,472 | ||||||||||||||||||
Bank of America Corp. | AA– | 4.75 | 10/15/06 | 500,000 | 499,834 | ||||||||||||||||||
Bank of Oklahoma | BBB+ | 7.13 | 08/15/07 | 350,000 | 362,187 | ||||||||||||||||||
Berkshire Hathaway Financial | AAA | 4.20 | 12/15/10 | 500,000 | 484,064 | ||||||||||||||||||
Brandywine Realty Trust | BBB– | 4.50 | 11/01/09 | 250,000 | 240,835 | ||||||||||||||||||
Capital One Bank | BBB | 5.75 | 09/15/10 | 250,000 | 255,962 | ||||||||||||||||||
Colonial Properties LP | BBB– | 4.80 | 04/01/11 | 300,000 | 289,569 | ||||||||||||||||||
Deere Capital Corp. | A– | 3.90 | 01/15/08 | 500,000 | 490,209 | ||||||||||||||||||
Developers Diversified Realty | BBB | 5.00 | 05/03/10 | 250,000 | 246,318 | ||||||||||||||||||
FleetBoston Financial Group | AA– | 3.85 | 02/15/08 | 250,000 | 245,063 | ||||||||||||||||||
Ford Motor Credit Co. | BB+ | 7.38 | 10/28/09 | 750,000 | 665,165 | ||||||||||||||||||
GE Capital Corp. | AAA | 2.75 | 09/25/06 | 750,000 | 739,364 | ||||||||||||||||||
General Motors Acceptance Corp. | BB | 6.75 | 01/15/06 | 500,000 | 499,670 | ||||||||||||||||||
Heller Financial, Inc. | AAA | 6.38 | 03/15/06 | 500,000 | 501,690 | ||||||||||||||||||
Household Finance Corp. | A | 6.50 | 01/24/06 | 500,000 | 500,498 | ||||||||||||||||||
JP Morgan Chase Bank | A+ | 5.63 | 08/15/06 | 500,000 | 502,143 | ||||||||||||||||||
Lehman Brothers Holdings | A+ | 4.00 | 01/22/08 | 500,000 | 491,719 | ||||||||||||||||||
Markel Corp. | BBB– | 7.00 | 05/15/08 | 150,000 | 155,519 | ||||||||||||||||||
Nationwide Health Properties | BBB– | 7.60 | 11/20/28 | 350,000 | 397,754 | ||||||||||||||||||
National Rural Utilities Coop. Finance Corp. | A+ | 3.88 | 02/15/08 | 250,000 | 244,615 | ||||||||||||||||||
Roslyn Bancorp, Inc. | BBB– | 7.50 | 12/01/08 | 500,000 | 530,121 | ||||||||||||||||||
SLM Corp. | A | 4.00 | 01/15/09 | 500,000 | 486,567 | ||||||||||||||||||
Sprint Capital Corp. | A– | 7.13 | 01/30/06 | 500,000 | 500,800 | ||||||||||||||||||
Textron Finance Corp. | A– | 2.69 | 10/03/06 | 500,000 | 492,455 | ||||||||||||||||||
The CIT Group, Inc. | A | 6.50 | 02/07/06 | 500,000 | 500,838 | ||||||||||||||||||
U S Bancorp | A+ | 3.95 | 08/23/07 | 500,000 | 493,521 | ||||||||||||||||||
Wells Fargo & Company | AA– | 3.50 | 04/04/08 | 250,000 | 242,920 | ||||||||||||||||||
11,785,462 |
(MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
INDUSTRIAL (0.7%) | ||||||||||||||||||||||
Deluxe Corp. | BBB+ | 3.50 | 10/01/07 | 500,000 | 476,970 | |||||||||||||||||
TECHNOLOGY (1.4%) | ||||||||||||||||||||||
Hewlett-Packard Co. | A– | 5.75 | 12/15/06 | 500,000 | 504,180 | |||||||||||||||||
IBM Corp. | A+ | 4.88 | 10/01/06 | 500,000 | 500,411 | |||||||||||||||||
1,004,591 | ||||||||||||||||||||||
TELECOMMUNICATIONS (1.1%) | ||||||||||||||||||||||
Nextel Communications, Inc. | A– | 5.25 | 01/15/10 | 250,000 | 249,687 | |||||||||||||||||
Verizon Global | A+ | 4.00 | 01/15/08 | 500,000 | 490,370 | |||||||||||||||||
740,057 | ||||||||||||||||||||||
UTILITIES (1.6%) | ||||||||||||||||||||||
Kinder Morgan | BBB | 5.15 | 03/01/15 | 250,000 | 242,877 | |||||||||||||||||
Pepco Holdings, Inc. | BBB | 4.00 | 05/15/10 | 250,000 | 237,414 | |||||||||||||||||
Telecom de Puerto Rico | BBB+ | 6.80 | 05/15/09 | 300,000 | 311,728 | |||||||||||||||||
Virginia Electric & Power Co. | BBB | 4.50 | 12/15/10 | 400,000 | 390,007 | |||||||||||||||||
1,182,026 | ||||||||||||||||||||||
TOTAL LONG-TERM DEBT SECURITIES (Cost: $71,677,109) 97.8% | 69,902,560 |
(MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
SHORT-TERM DEBT SECURITIES: | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
U.S. GOVERNMENT AGENCIES (1.0%) | ||||||||||||||||||
Federal National Mortgage Association | 3.25 | 01/03/06 | 680,000 | 679,816 | ||||||||||||||
TOTAL SHORT-TERM DEBT SECURITIES (Cost: $679,816) 1.0% | 679,816 | |||||||||||||||||
TOTAL INVESTMENTS (Cost: $72,356,925) 98.8% | 70,582,376 | |||||||||||||||||
OTHER NET ASSETS 1.2% | 860,878 | |||||||||||||||||
NET ASSETS 100.0% | $ | 71,443,254 |
Abbreviations: | FHLB = Federal Home Loan Bank FHLMC = Federal Home Loan Mortgage Corporation FNMA = Federal National Mortgage Association |
(SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
U.S. GOVERNMENT (19.5%) | |||||||||||||||||||||||
U.S. Treasury Note | AAA | 2.75 | 07/31/06 | 2,500,000 | 2,476,465 | ||||||||||||||||||
U.S. Treasury Note | AAA | 3.00 | 11/15/07 | 1,500,000 | 1,462,617 | ||||||||||||||||||
U.S. Treasury Strip | AAA | 0.00 | 11/15/08 | 4,000,000 | 3,530,388 | ||||||||||||||||||
7,469,470 | |||||||||||||||||||||||
U.S. GOVERNMENT AGENCIES (53.2%) | |||||||||||||||||||||||
MORTGAGE-BACKED OBLIGATIONS (11.4%) | |||||||||||||||||||||||
FHLMC | AAA | 8.50 | 06/01/06 | 12,494 | 12,644 | ||||||||||||||||||
FHLMC | AAA | 7.50 | 02/15/07 | 8,275 | 8,262 | ||||||||||||||||||
FHLMC | AAA | 7.00 | 03/15/07 | 8,167 | 8,154 | ||||||||||||||||||
FHLMC | AAA | 7.75 | 05/01/08 | 59,615 | 61,197 | ||||||||||||||||||
FHLMC | AAA | 6.00 | 10/01/08 | 84,646 | 86,029 | ||||||||||||||||||
FHLMC | AAA | 5.50 | 04/01/09 | 62,356 | 62,774 | ||||||||||||||||||
FHLMC | AAA | 5.50 | 06/01/09 | 67,172 | 67,735 | ||||||||||||||||||
FHLMC | AAA | 8.25 | 10/01/09 | 10,852 | 10,845 | ||||||||||||||||||
FHLMC | AAA | 6.50 | 11/01/09 | 18,619 | 19,122 | ||||||||||||||||||
FHLMC | AAA | 7.50 | 07/01/10 | 3,908 | 4,006 | ||||||||||||||||||
FHLMC | AAA | 6.00 | 11/01/10 | 47,863 | 48,824 | ||||||||||||||||||
FHLMC | AAA | 7.00 | 02/01/14 | 49,786 | 52,142 | ||||||||||||||||||
FHLMC | AAA | 6.50 | 04/01/14 | 216,322 | 224,059 | ||||||||||||||||||
FHLMC | AAA | 8.00 | 05/01/14 | 8,834 | 9,013 | ||||||||||||||||||
FHLMC | AAA | 6.00 | 07/01/16 | 17,366 | 17,831 | ||||||||||||||||||
FHLMC | AAA | 8.50 | 09/01/17 | 9,838 | 10,076 | ||||||||||||||||||
FHLMC | AAA | 8.00 | 09/01/18 | 39,700 | 40,860 | ||||||||||||||||||
FHLMC | AAA | 6.00 | 02/01/19 | 53,876 | 54,924 | ||||||||||||||||||
FHLMC | AAA | 7.50 | 03/15/21 | 37,099 | 37,035 | ||||||||||||||||||
FHLMC | AAA | 4.50 | 03/15/22 | 1,100,494 | 1,096,338 | ||||||||||||||||||
FHLMC | AAA | 4.00 | 11/15/26 | 475,050 | 467,789 | ||||||||||||||||||
FNMA | AAA | 7.50 | 07/01/06 | 777 | 780 | ||||||||||||||||||
FNMA | AAA | 7.75 | 03/01/08 | 12,369 | 12,507 | ||||||||||||||||||
FNMA | AAA | 8.00 | 04/01/08 | 13,105 | 13,539 | ||||||||||||||||||
FNMA | AAA | 6.00 | 09/01/08 | 37,210 | 37,779 | ||||||||||||||||||
FNMA | AAA | 7.50 | 09/01/08 | 16,324 | 16,630 | ||||||||||||||||||
FNMA | AAA | 5.50 | 11/01/08 | 43,652 | 44,021 | ||||||||||||||||||
FNMA | AAA | 5.50 | 12/01/08 | 10,395 | 10,483 | ||||||||||||||||||
FNMA | AAA | 7.50 | 01/01/09 | 4,308 | 4,308 | ||||||||||||||||||
FNMA | AAA | 5.50 | 02/01/09 | 27,832 | 28,067 | ||||||||||||||||||
FNMA | AAA | 6.00 | 07/01/09 | 44,619 | 45,301 | ||||||||||||||||||
FNMA | AAA | 8.50 | 12/01/09 | 20,232 | 21,145 | ||||||||||||||||||
FNMA | AAA | 8.25 | 01/01/10 | 20,150 | 20,344 | ||||||||||||||||||
FNMA | AAA | 6.00 | 01/01/11 | 24,280 | 24,651 | ||||||||||||||||||
FNMA | AAA | 6.00 | 09/01/12 | 78,090 | 79,774 | ||||||||||||||||||
FNMA | AAA | 6.50 | 08/01/13 | 47,627 | 48,863 | ||||||||||||||||||
FNMA | AAA | 8.75 | 09/01/16 | 26,314 | 26,609 |
(SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
U.S. GOVERNMENT AGENCIES (Cont’d.) | |||||||||||||||||||||||
MORTGAGE-BACKED OBLIGATIONS (Cont’d.) | |||||||||||||||||||||||
FNMA | AAA | 8.00 | 06/01/17 | 4,768 | 4,807 | ||||||||||||||||||
FNMA | AAA | 4.50 | 10/25/17 | 1,000,000 | 993,078 | ||||||||||||||||||
FNMA | AAA | 6.50 | 01/25/23 | 48,787 | 49,045 | ||||||||||||||||||
FNMA | AAA | 6.50 | 12/25/23 | 156,307 | 157,573 | ||||||||||||||||||
FNMA | AAA | 4.00 | 11/25/26 | 100,000 | 98,383 | ||||||||||||||||||
GNMA (1) | AAA | 7.50 | 07/15/07 | 16,402 | 16,702 | ||||||||||||||||||
GNMA (1) | AAA | 7.00 | 08/15/07 | 39,637 | 40,190 | ||||||||||||||||||
GNMA (1) | AAA | 7.50 | 05/20/08 | 20,440 | 20,953 | ||||||||||||||||||
GNMA (1) | AAA | 6.00 | 11/15/08 | 45,622 | 46,376 | ||||||||||||||||||
GNMA (1) | AAA | 6.00 | 06/15/09 | 23,816 | 24,341 | ||||||||||||||||||
GNMA (1) | AAA | 9.00 | 03/15/10 | 11,309 | 12,014 | ||||||||||||||||||
Residential Funding Mtge. Sec. | AAA | 5.00 | 02/25/33 | 73,367 | 73,156 | ||||||||||||||||||
4,371,078 | |||||||||||||||||||||||
NON-MORTGAGE-BACKED OBLIGATION (41.8%) | |||||||||||||||||||||||
FFCB | AAA | 2.88 | 06/29/06 | 1,000,000 | 991,724 | ||||||||||||||||||
FHLB | AAA | 2.50 | 03/15/06 | 500,000 | 497,885 | ||||||||||||||||||
FHLB | AAA | 2.88 | 09/15/06 | 2,800,000 | 2,765,568 | ||||||||||||||||||
FHLMC | AAA | 2.75 | 08/15/06 | 1,000,000 | 988,583 | ||||||||||||||||||
FHLMC | AAA | 2.38 | 02/15/07 | 2,000,000 | 1,948,354 | ||||||||||||||||||
FHLMC | AAA | 3.88 | 06/15/08 | 3,750,000 | 3,675,720 | ||||||||||||||||||
FHLMC | AAA | 3.63 | 09/15/08 | 1,500,000 | 1,458,467 | ||||||||||||||||||
FNMA | AAA | 2.25 | 05/15/06 | 2,000,000 | 1,982,952 | ||||||||||||||||||
FNMA | AAA | 2.63 | 11/15/06 | 1,000,000 | 982,255 | ||||||||||||||||||
FNMA | AAA | 2.38 | 02/15/07 | 750,000 | 730,475 | ||||||||||||||||||
16,021,983 | |||||||||||||||||||||||
BASIC MATERIALS (1.5%) | |||||||||||||||||||||||
International Paper Co. | BBB | 3.80 | 04/01/08 | 200,000 | 193,875 | ||||||||||||||||||
Lubrizol Corp. | BBB– | 5.88 | 12/01/08 | 200,000 | 203,510 | ||||||||||||||||||
Monsanto Co. | A– | 4.00 | 05/15/08 | 100,000 | 97,854 | ||||||||||||||||||
Praxair, Inc. | A– | 2.75 | 06/15/08 | 100,000 | 95,159 | ||||||||||||||||||
590,398 | |||||||||||||||||||||||
CONSUMER, CYCLICAL (2.2%) | |||||||||||||||||||||||
Belo Corporation | BBB | 8.00 | 11/01/08 | 150,000 | 159,344 | ||||||||||||||||||
Caterpillar Fin. Svc. | A | 2.63 | 01/30/07 | 250,000 | 244,245 | ||||||||||||||||||
Daimlerchrysler | BBB | 4.05 | 06/04/08 | 150,000 | 146,024 | ||||||||||||||||||
Dow Jones & Co. | A– | 3.88 | 02/15/08 | 150,000 | 147,041 | ||||||||||||||||||
May Dept Stores Co. | BBB | 3.95 | 07/15/07 | 140,000 | 137,665 | ||||||||||||||||||
834,319 |
(SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
CONSUMER, NON-CYCLICAL (1.9%) | ||||||||||||||||||||||
CVS Corp. | A– | 5.63 | 03/15/06 | 150,000 | 150,174 | |||||||||||||||||
Coca-Cola Enterprises | A | 2.50 | 09/15/06 | 100,000 | 98,271 | |||||||||||||||||
General Mills, Inc. | BBB+ | 3.88 | 11/30/07 | 200,000 | 196,081 | |||||||||||||||||
General Mills, Inc. | BBB+ | 2.63 | 10/24/06 | 100,000 | 97,924 | |||||||||||||||||
Kellogg Co. | BBB+ | 2.88 | 06/01/08 | 200,000 | 190,554 | |||||||||||||||||
733,004 | ||||||||||||||||||||||
ENERGY (2.3%) | ||||||||||||||||||||||
Cooper Cameron Corp. | BBB+ | 2.65 | 04/15/07 | 200,000 | 193,373 | |||||||||||||||||
Devon Energy | BBB | 2.75 | 08/01/06 | 100,000 | 98,644 | |||||||||||||||||
Dominion Resources | BBB | 4.13 | 02/15/08 | 200,000 | 196,291 | |||||||||||||||||
Marathon Oil Corp. | BBB+ | 5.38 | 06/01/07 | 200,000 | 201,066 | |||||||||||||||||
Ocean Energy, Inc. | BBB | 4.38 | 10/01/07 | 200,000 | 197,733 | |||||||||||||||||
887,107 | ||||||||||||||||||||||
FINANCIAL (10.9%) | ||||||||||||||||||||||
American Express Co. | A+ | 5.50 | 09/12/06 | 200,000 | 200,943 | |||||||||||||||||
American Honda Fin | A+ | 3.85 | 11/06/08 | 200,000 | 194,589 | |||||||||||||||||
Bank of America Corp. | AA– | 4.75 | 10/15/06 | 100,000 | 99,967 | |||||||||||||||||
Bank of New York, Inc. | A+ | 3.90 | 09/01/07 | 200,000 | 196,970 | |||||||||||||||||
Bank of Oklahoma | BBB+ | 7.13 | 08/15/07 | 250,000 | 258,705 | |||||||||||||||||
Bear Stearns Cos., Inc. | A | 3.00 | 03/30/06 | 100,000 | 99,611 | |||||||||||||||||
CIT Group, Inc. | A | 2.88 | 09/29/06 | 100,000 | 98,611 | |||||||||||||||||
Capital One Bank | BBB | 4.88 | 05/15/08 | 200,000 | 199,186 | |||||||||||||||||
Deere Capital Corp. | A– | 3.90 | 01/15/08 | 200,000 | 196,083 | |||||||||||||||||
Fifth Third Bank | AA– | 3.38 | 08/15/08 | 200,000 | 192,732 | |||||||||||||||||
First Tennessee Bank | A– | 5.75 | 12/01/08 | 200,000 | 204,207 | |||||||||||||||||
GE Capital Corp. | AAA | 2.75 | 09/25/06 | 250,000 | 246,455 | |||||||||||||||||
Huntington National Bank | A– | 3.13 | 05/15/08 | 200,000 | 192,124 | |||||||||||||||||
IBM Corp. | A+ | 3.80 | 02/01/08 | 100,000 | 97,940 | |||||||||||||||||
JP Morgan Chase Bank | A+ | 5.63 | 08/15/06 | 100,000 | 100,429 | |||||||||||||||||
Lehman Brothers Holdings | A+ | 3.50 | 08/07/08 | 200,000 | 193,030 | |||||||||||||||||
Merrill Lynch | A+ | 3.13 | 07/15/08 | 200,000 | 191,604 | |||||||||||||||||
National City Bank | A+ | 3.38 | 10/15/07 | 250,000 | 243,456 | |||||||||||||||||
National Rural Utilities Coop. Finance Corp. | A+ | 3.00 | 02/15/06 | 185,000 | 184,680 | |||||||||||||||||
Northern Trust Co. | AA– | 2.88 | 12/15/06 | 200,000 | 196,159 | |||||||||||||||||
Textron Finance Corp. | A– | 2.69 | 10/03/06 | 100,000 | 98,491 | |||||||||||||||||
National Rural Utilities Coop. Finance Corp. | AA– | 2.85 | 11/15/06 | 150,000 | 147,525 | |||||||||||||||||
Vornado Realty Trust | BBB | 5.63 | 06/15/07 | 145,000 | 146,014 | |||||||||||||||||
Wachovia Corp. | A+ | 3.50 | 08/15/08 | 200,000 | 193,255 | |||||||||||||||||
4,172,766 |
(SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
LONG-TERM DEBT SECURITIES: | | Rating* | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
HEALTHCARE (0.5%) | |||||||||||||||||||||||
UnitedHealth Group | A | 3.38 | 08/15/07 | 200,000 | 195,466 | ||||||||||||||||||
INDUSTRIAL (3.6%) | |||||||||||||||||||||||
Bunge, Ltd. | BBB | 4.38 | 12/15/08 | 200,000 | 196,549 | ||||||||||||||||||
Comcast Cable Communications | BBB+ | 6.20 | 11/15/08 | 200,000 | 205,307 | ||||||||||||||||||
Conoco Funding Co. | A– | 5.45 | 10/15/06 | 200,000 | 200,783 | ||||||||||||||||||
Deluxe Corp. | BBB+ | 3.50 | 10/01/07 | 250,000 | 238,485 | ||||||||||||||||||
General Dynamics Corp. | A | 2.13 | 05/15/06 | 100,000 | 99,110 | ||||||||||||||||||
Lafarge Corp. | BBB | 6.50 | 07/15/08 | 100,000 | 102,990 | ||||||||||||||||||
Raytheon Co. | BBB | 4.50 | 11/15/07 | 200,000 | 198,277 | ||||||||||||||||||
Union Pacific Corp. | BBB | 5.75 | 10/15/07 | 120,000 | 121,657 | ||||||||||||||||||
1,363,158 | |||||||||||||||||||||||
TECHNOLOGY (1.3%) | |||||||||||||||||||||||
First Data Corp. | A+ | 3.38 | 08/01/08 | 100,000 | 95,632 | ||||||||||||||||||
Hewlett-Packard Co. | A– | 5.75 | 12/15/06 | 100,000 | 100,836 | ||||||||||||||||||
IBM Corp. | A+ | 4.88 | 10/01/06 | 100,000 | 100,082 | ||||||||||||||||||
Pitney Bowes, Inc. | A+ | 5.75 | 08/15/08 | 200,000 | 203,924 | ||||||||||||||||||
500,474 | |||||||||||||||||||||||
UTILITIES (1.5%) | |||||||||||||||||||||||
DTE Energy Co. | BBB– | 6.45 | 06/01/06 | 200,000 | 201,281 | ||||||||||||||||||
Exelon Corp. | A– | 3.50 | 05/01/08 | 150,000 | 145,126 | ||||||||||||||||||
Telecom de Puerto Rico | BBB+ | 6.80 | 05/15/09 | 200,000 | 207,819 | ||||||||||||||||||
554,226 | |||||||||||||||||||||||
TOTAL LONG-TERM DEBT SECURITIES (Cost: $38,200,583) 98.4% | 37,693,449 |
(SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
December 31, 2005
SHORT-TERM DEBT SECURITIES: | | Rate(%) | | Maturity | | Face Amount($) | | Value($) | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
U.S. GOVERNMENT AGENCIES (1.4%) | ||||||||||||||||||
Federal National Mortgage Association | 4.23 | 02/02/06 | 302,000 | 300,825 | ||||||||||||||
Federal National Mortgage Association | 3.25 | 01/03/06 | 260,000 | 259,930 | ||||||||||||||
560,755 | ||||||||||||||||||
TOTAL SHORT-TERM DEBT SECURITIES (Cost: $560,755) 1.4% | 560,755 | |||||||||||||||||
TOTAL INVESTMENTS (Cost: $38,761,338) 99.8% | 38,254,204 | |||||||||||||||||
OTHER NET ASSETS 0.2% | 60,556 | |||||||||||||||||
NET ASSETS 100.0% | $ | 38,314,760 |
Abbreviations: | FFCB = Federal Farm Credit Bank FHLB = Federal Home Loan Bank FHLMC = Federal Home Loan Mortgage Corporation FNMA = Federal National Mortgage Association GNMA = Government National Mortgage Association |
(16)(a) | Power of Attorney of Mr. Altstadt (Incorporated by reference to Pre-Effective Amendment No. 1 to this Registration Statement on Form N-14 filed on April 3, 2006 (File No. 333-131940).) |
(b) | Power of Attorney of Mr. Flanagan (Incorporated by reference to Pre-Effective Amendment No. 1 to this Registration Statement on Form N-14 filed on April 3, 2006 (File No. 333-131940).) |
(c) | Power of Attorney of Mr. Mertz (Incorporated by reference to Pre-Effective Amendment No. 1 to this Registration Statement on Form N-14 filed on April 3, 2006 (File No. 333-131940).) |
(d) | Power of Attorney of Mr. Nolan (Incorporated by reference to Pre-Effective Amendment No. 1 to this Registration Statement on Form N-14 filed on April 3, 2006 (File No. 333-131940).) |
(e) | Power of Attorney of Mr. McGuire (Incorporated by reference to Pre-Effective Amendment No. 1 to this Registration Statement on Form N-14 filed on April 3, 2006 (File No. 333-131940).) |
INVESTMENT CORPORATION
(Registrant)
By: | /s/ Manfred Altstadt |
Name: | Manfred Altstadt |
Title: | Chairman of the Board, President and Chief Executive Officer |
Signature | Title | Date | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
/s/ Manfred Altstadt* | Chairman of the Board, President and Chief Executive Officer | June 2, 2006 | ||||||||
/s/ John R. Greed | Executive Vice President, Chief Financial Officer and Treasurer | June 2, 2006 | ||||||||
/s/ * | Director | June 2, 2006 | ||||||||
/s/ * | Director | June 2, 2006 | ||||||||
/s/ * | Director | June 2, 2006 | ||||||||
/s/ * | Director | June 2, 2006 | ||||||||
/s/ * | Director | June 2, 2006 |
*By: /s/ | , Attorney-in-fact |