Value Line, Inc.
220 E. 42nd Street- 6th Floor
New York, NY 10017
Tel: (212) 907-1500
Fax: (212) 682-5779
May 20, 2011
United States
Securities and Exchange Commission
Division of Corporation Finance
Washington, D.C. 20549-4631
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Re:
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Value Line, Inc. Form 10-K for the Fiscal Year Ended April 30, 2010
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Filed July 16, 2010; Definitive Proxy Statement on Schedule 14A Filed August 6, 2010; Forms 10-Q for the Fiscal Quarters Ended July 31, 2010, October 31, 2010 and January 31, 2011; File No. 0-11306
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Ladies and Gentlemen:
Set forth below are our responses to the additional comments of the staff of the Division of Corporation Finance contained in your letter dated May 6, 2011, with respect to Value Line, Inc.’s (“Value Line” or the “Company”) Form 10-K for the fiscal year ended April 30, 2010 filed on July 16, 2010; Definitive Proxy Statement on Schedule 14A Filed August 6, 2010; and Forms 10-Q for the fiscal quarters ended July 31, 2010, October 31, 2010 and January 31, 2011. The Staff’s comments are in italics followed by the responses (“Answers:”) of the Company.
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1.
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We have considered your responses regarding the restructuring of the capital structure of EAM, and we do not object to your use of the equity method of accounting for your remaining interest. Please note that it appears EAM is a variable interest entity (VIE). Please refer to the guidance in ASC 810-1O-15-14.b.1 and ASC 810-10-15- 14.c.1. As such, in future filings please provide the disclosures required by ASC 810- 50 for variable interests that are not the primary beneficiary of a VIE. Please also note that ASC 810-10 requires the controlling financial interest (i.e., primary beneficiary) analysis be reconsidered each reporting period. Please provide us with the disclosures you intend to include in future filings.
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Answer:
Value Line intends to include the following additional disclosure in the footnotes to the consolidated financial statements in its Form 10-K:
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 2
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“Note 1: Organization and Summary of Significant Accounting Policies
Principles of Consolidation (continued)
The Company follows the guidance in FASB Topic 810 “Consolidation” to determine if it should consolidate its investment in a variable interest entity (VIE). A VIE is a legal entity in which either (i) equity investors do not have sufficient equity investment at risk to enable the entity to finance its activities independently or (ii) the equity holders at risk lack the obligation to absorb losses, the right to receive residual returns or the right to make decisions about the entity’s activities that most significantly affect the entity’s economic performance. A holder of a variable interest in a VIE is required to consolidate the entity if it is determined that it has a controlling financial interest in the VIE and is therefore the primary beneficiary. The determination of a controlling financial interest is based on a qualitative assessment to identify the variable interest holder that has (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) either the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The accounting guidance requires the Company to perform an ongoing assessment of whether it is the primary beneficiary of a variable interest entity.
Note X: Variable Interest Entity
As discussed in Note Z, as part of the restructuring transaction, the Company retained a revenues interest and 50% non-voting profits interest in EAM, which was formed to carry on the asset management and mutual fund distribution businesses formerly conducted by Value Line and its subsidiaries. EAM is considered to be a variable interest entity. The Company makes its determination for consolidation of EAM as a variable interest entity based on a qualitative assessment of the purpose and design of EAM, the terms and characteristics of the variable interests in EAM, and the risks EAM is designed to create and pass through to holders of variable interests. Other than EAM, the Company does not have an interest in any other variable interest entities.
Value Line has determined that it does not have a controlling financial interest in EAM because it does not have the power to direct the activities of EAM that most significantly impact its economic performance. Value Line does not hold any voting stock of EAM and it does not have any involvement in the day to day activity or operations of EAM. Although the EAM Trust agreement provides Value Line with certain consent rights and contains certain restrictive covenants related to the activities of EAM, these are considered to be protective rights and therefore Value Line does not maintain control over EAM.
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 3
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In addition, although EAM is expected to be profitable, there is a risk that it could operate at a loss. While all of the profit interest shareholders’ interests in EAM are subject to variability based on EAM’s operational risk, Value Line’s primary interest in EAM is a preferred interest in the revenues of EAM, rather than a profits interest and Value Line accordingly believes it is subject to proportionately less risk than the other holders of the profits interests.
The Company has not provided any explicit or implicit financial or other support to EAM other than what was contractually required in the EAM Trust agreement. Value Line has no obligation to fund EAM in the future and as a result has no exposure to loss beyond its initial investment and any undistributed revenues and profits interests retained in EAM. The following table presents the total assets of EAM, the maximum exposure to loss due to involvement with EAM, as well as the value of the assets and liabilities the Company has recorded for its interest in EAM as of April 30, 2011.
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Maximum
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Revenues
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|||||||||||||||||||
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VIE
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Exposure
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Investment
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Receivable
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Liabilities
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||||||||||||||||
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Assets
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to Loss
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(1)
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(2)
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(in thousands)
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||||||||||||||||||||
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EAM
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$ | 57,780 | $ | 56,627 | $ | 56,113 | $ | 514 | -0- | |||||||||||
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(1)
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Reported within Long Term Assets on consolidated balance sheets.
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(2)
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Reported within Current Assets on consolidated balance sheets.”
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2.
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Please note that for each annual reporting period you will need to consider the requirements of Rule 3-09 of Regulation S-X to determine whether you need to include as an exhibit EAM's audited financial statements. Please note that we would consider the operating entities transferred to the trust to be predecessors to EAM, and their historical financial statements also may be required.
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Answer:
The Company will consider the requirements of Rule 3-09 of Regulation S-X to determine whether it needs to include EAM’s audited financial statements and the historical financial statements for the operating entities transferred to the EAM trust as exhibits to VLI’s Form 10-K. Attached as exhibit 2 are the unaudited financial statements of EULAV Asset Management Trust as of March 31, 2011.
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3.
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We note your response to comment 12 in our letter dated March 4, 2011. We continue to have concerns about the estimated fair value of your remaining investment in EAM. Please provide us with a copy of the valuation report prepared by the third party valuation firm utilized to estimate the fair value, in addition to any other documentation that supports the estimates made in the discounted cash flow method.
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 4
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Answer:
The valuation firm’s report was incorporated into our reply dated March 4, 2011 in response to your previous inquiry. For your reference following is our previous reply to comment #12.
“The analysis of the estimated fair value of Value Line’s interest in EAM considered valuations using the Guideline Public Company method and Comparable Transactions method under the market approach and the Discounted Cash Flow method under the income approach.
Guideline Public Company Method
This valuation method included an analysis of the population of possible guideline companies and selection of those that were considered to be most comparable to EAM in terms of business operations, size, stage of development, prospects for growth and risk. Fourteen comparable companies were identified. From the analysis of these guideline public companies, it was determined that the Enterprise Value to Assets Under Management (“AUM”) and Enterprise Value to EBITDA are frequently applied multiples to companies in this industry segment. The last twelve months (LTM) and forward EBITDA multiples of the guideline public companies were applied to EAM’s respective financial metrics as of December 31, 2010 and 2011. Then, the AUM multiple of the guideline public companies was applied to the Company’s audited AUM as of December 31, 2009 (the most recent prior to the disposition transaction) of $2.29 billion. Using the 25th percentile multiple of the peer group analyzed, those multiples were then applied to EAM’s respective financial data to determine an estimated fair value of EAM. The 25th percentile was chosen because AUM and profitability within the peer group has improved at a faster rate than those of EAM.
Comparable Transaction Method
This valuation method included an analysis of recent transactions in the marketplace for which there was relevant financial data available, and which could be considered reasonably comparable to EAM. The analysis resulted in twenty-three comparable transactions that were completed within the last three years for asset management companies that were deemed to be non-distressed in nature and representative of fair value. For each of the transactions, an Enterprise Value to EBITDA and Enterprise Value to assets under management multiples were determined, and the 25th percentile (see above for basis of 25th percentile) of the implied multiples were applied to EAM’s financial data to determine the fair value of EAM.
In assessing the adequacy of these methods to the determination of Value Line’s non-voting revenue and profits interest in EAM, Value Line considered the fact that both these valuation methodologies resulted in a determination of an “enterprise value”, i.e., an economic measure reflecting the market value of a whole business. Upon detailed review of the contractual mechanism and structure of EAM, it was deemed that it was not appropriate to compare an “enterprise value” construct to this situation where VLI, in substance and form, is entitled to a specified stream of cash flows as defined in the EAM trust agreement. A market participant would consider enterprise value as a sum of claims of all the security-holders: debt-holders, preferred shareholders, minority shareholders, common equity holders, and other. Value Line’s view was that an enterprise value transaction must be distinguished from Value Line’s nonvoting revenues and profits interests. Such interests are appropriately evaluated as cash flow streams, much like a royalty interest. Accordingly, Value Line, although having considered using the results of the two market approach methods, chose instead to rely solely on the income approach method to determine the fair value of its interest in EAM (see below).
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 5
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Income Approach (Discounted Cash Flow Method)
Performing a discounted cash flow analysis requires the preparation and analysis of a reliable forecast of the expected future financial performance of the subject entity. Forecasting cash flow available to the enterprise requires the projection of revenues, operating expenses, taxes, working capital requirements and capital expenditures for a future period, usually three years or more. Projected cash flows must then be discounted to a present value using a discount rate, which appropriately accounts for the market cost of capital, as well as the risk and nature of the subject cash flows. Finally, an assumption must be made regarding the sustainable long-term earnings growth rate at the end of the projection period, and a terminal or residual value of the remaining cash flows must be estimated and discounted to a present value. The sum of the present values of the projected cash flows and the terminal value equals the enterprise value.
Net Income
The Company prepared financial projections for the fiscal year ending April 30, 2010 through April 30, 2015. Income taxes and depreciation were estimated based on projected income before taxes and the historical relationship between sales and depreciation, respectively.
Cash Flow Adjustments
In order to accurately present EAM’s projected operating performance and ongoing cost structure, adjustments were made to certain revenue and expense line items to attempt to arrive at debt-free net cash flow in the valuation model. First, noncash items, including depreciation, were added back to debt-free net income (which is the same as after-debt net income since there is no debt). Second, forecasted capital expenditures and investment in operating working capital were subtracted from the resulting gross cash flow. Working capital requirements were forecast across the entire projected period by analyzing changes on the projected balance sheet.
Discount Rate Estimation
The discount rate applied to the forecasted cash flows and terminal value must adequately reflect the nature of the subject investment and the risk of the underlying cash flows. The appropriate discount rate is the weighted average cost of capital, calculated using estimates of required equity rates of return based upon a build-up approach illustrated below:
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 6
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Eulav Asset Management
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Weighted Average Cost of Capital
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Estimating the Cost of Capital - Buildup Method
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Cost of Equity Estimate:
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Riskless Rate 1
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3.89 | % | ||
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Equity Risk Premium 2
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5.45 | % | ||
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Industry Risk Premium 3
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4.62 | % | ||
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Size Premium 4
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6.00 | % | ||
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Additional Risk factor 5
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3.00 | % | ||
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Cost of Equity Estimate
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22.96 | % | ||
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Cost of Debt Capital:
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Cost of Debt 6
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0.00 | % | ||
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Tax Rate
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38.00 | % | ||
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After-tax Debt Rate
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0.00 | % | ||
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Targeted Capital Structure: 7
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Equity / Enterprise Value
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100.00 | % | ||
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Debt / Enterprise Value
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0.00 | % | ||
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Total Enterprise Value
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100.00 | % | ||
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WACC (Rounded)
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23.00 | % | ||
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1
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Long-Term (30-year) U.S. Treasury Coupon Bond Yield - as of 06/30/2010
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2
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Long-Run Stock Returns: Participating in the Real Economy - Ibbotson and Chen, 2007
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3
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IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010 SIC 6282: Investment Advice
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4
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IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010
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5
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Additional risk factor specific to the nature of EAM trust agreement as it pertains to Shareholder of Non Voting Revenue & Profits Interests
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6
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Cost of debt is an estimate of Value Line's marginal interest rate.
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7
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Targeted Capital Structure is based upon the anticipated capital structure of EAM
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 7
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Terminal Value Calculation
The terminal value was based on a terminal value cash flow multiple. The multiple or capitalization rate was calculated by taking the inverse of the result of subtracting a 3.0% terminal growth rate from the 23% weighted average cost of capital (see above). The terminal growth rate of 3.0% was determined based upon the analysis of the asset management industry and the position of EAM therein. The capitalization rate was applied to the growth-adjusted terminal year cash flow and then discounted to the present value to determine the terminal value.
The discounted cash flow calculation was separately computed for the operating profits interest and the revenue interest. The cash flows for the separate interests were derived from the forecasted financial statements by separating the forecasted annual VLI revenue interest (as defined in the Trust agreement) and related tax from the total entity revenues and related entity tax for each period. The aforementioned analysis was then applied to the separate (operating and revenues) cash flows to determine the present value of the cash flows for each period and corresponding separate values for the operating profit and revenues interest retained by VLI. (Attached are schedules that provide the calculations of those values).
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 8
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Eulav Asset Management
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Pro forma Income Statement
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$ in thousands
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4/30/2011
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4/30/2012
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4/30/2013
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4/30/2014
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4/30/2015
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Mutual Fund Revenues
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$ | 14,424.7 | $ | 17,435.7 | $ | 21,425.6 | $ | 27,056.3 | $ | 35,026.0 | ||||||||||
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Asset Management Fees
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$ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | ||||||||||
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12b-1 Fees
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$ | 4,108.8 | $ | 4,910.2 | $ | 6,133.1 | $ | 7,862.3 | $ | 10,350.1 | ||||||||||
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Total Revenue
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$ | 18,683.2 | $ | 22,495.6 | $ | 27,708.4 | $ | 35,068.3 | $ | 45,525.8 | ||||||||||
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Revenue Growth
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7.3 | % | 20.4 | % | 23.2 | % | 26.6 | % | 29.8 | % | ||||||||||
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Marketing and Promotion-supermarket fees
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$ | 5,000.2 | $ | 6,036.3 | $ | 7,404.0 | $ | 9,389.3 | $ | 12,116.4 | ||||||||||
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Marketing and Promotion-other
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121.7 | $ | 124.4 | $ | 127.1 | $ | 129.9 | $ | 132.8 | |||||||||||
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Salary and Benefits
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3,862.2 | 4,396.4 | 5,393.8 | 6,801.5 | 8,793.9 | |||||||||||||||
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Office and Adminstration
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1,657.5 | 1,772.1 | 1,766.0 | 1,672.4 | 1,510.7 | |||||||||||||||
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Overhead
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275.9 | 282.0 | 288.2 | 294.6 | 301.0 | |||||||||||||||
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Expenses
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10,862.3 | 12,544.6 | 14,897.3 | 18,184.0 | 22,720.2 | |||||||||||||||
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Depreciation and Amortization
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55.3 | 66.6 | 82.03 | 103.8 | 134.7 | |||||||||||||||
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Total Expenses
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$ | 10,917.6 | $ | 12,611.2 | $ | 14,979.2 | $ | 18,287.7 | $ | 22,854.9 | ||||||||||
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Operating Profit
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$ | 7,765.6 | $ | 9,884.4 | $ | 12,729.2 | $ | 16,780.6 | $ | 22,670.9 | ||||||||||
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Operating Margin
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41.6 | % | 43.9 | % | 45.9 | % | 47.9 | % | 49.8 | % | ||||||||||
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Income Tax (Expense) / Benefit
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$ | 2,950.9 | $ | 3,756.1 | $ | 4,837.1 | $ | 6,376.6 | $ | 8,615.0 | ||||||||||
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Tax Rate
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38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
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Net Income
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$ | 4,814.7 | $ | 6,128.3 | $ | 7,892.1 | $ | 10,404.0 | $ | 14,056.0 | ||||||||||
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Net Income Margin
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25.8 | % | 27.2 | % | 28.5 | % | 29.7 | % | 30.9 | % | ||||||||||
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EBITDA
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$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
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EBITDA Margin
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41.9 | % | 44.2 | % | 46.2 | % | 48.1 | % | 50.1 | % | ||||||||||
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EAM
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Calculation of Net Present Value of Non-Voting Revenue Interest
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$ in thousands
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4/30/2011
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4/30/2012
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4/30/2013
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4/30/2014
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4/30/2015
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Mutual Fund Revenues
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$ | 14,424.7 | $ | 17,435.7 | $ | 21,425.6 | $ | 27,056.3 | $ | 35,026.0 | ||||||||||
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Asset Management Fees
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$ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | ||||||||||
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Total Revenue
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$ | 14,574.4 | $ | 17,585.4 | $ | 21,575.3 | $ | 27,206.0 | $ | 35,175.7 | ||||||||||
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VLI Revenue Interest % *
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49.13 | % | 50.61 | % | 51.61 | % | 53.01 | % | 55.00 | % | ||||||||||
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VLI Revenue Interest
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$ | 7,161.0 | $ | 8,900.0 | $ | 11,134.0 | $ | 14,423.0 | $ | 19,347.0 | ||||||||||
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Income Tax (Expense) / Benefit
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$ | 2,721.2 | $ | 3,382.0 | $ | 4,230.9 | $ | 5,480.7 | $ | 7,351.9 | ||||||||||
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Tax Rate
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38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
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Net Cash Flow
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$ | 4,439.8 | $ | 5,518.0 | $ | 6,903.1 | $ | 8,942.3 | $ | 11,995.1 | ||||||||||
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Present Value of Revenue Interest Net Cash Flows
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Present Value Factor @ 23.0%
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0.9017 | 0.7331 | 0.5960 | 0.4845 | 0.3939 | |||||||||||||||
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Present Value of Net Cash Flows
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$ | 4,003.3 | $ | 4,045.1 | $ | 4,114.2 | $ | 4,332.9 | $ | 4,725.3 | ||||||||||
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Total Present Value of Revenue Interest Net Cash Flows
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$ | 21,220.69 | ||||||||||||||||||
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Present Value of Terminal Revenue Interest Net Cash Flows:
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||||||||||||||||||||
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Terminal Period (Year 5 Net Cash Flow X Terminal Growth at 3.0%)
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$ | 12,355.0 | ||||||||||||||||||
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Capitalization Multiple
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5.00 | x | ||||||||||||||||||
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Terminal Value
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$ | 61,775.0 | ||||||||||||||||||
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Present Value Factor @ 23.0%
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0.3939 | |||||||||||||||||||
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Present Value of Terminal Revenue Interest Net Cash Flows
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$ | 24,335.46 | ||||||||||||||||||
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Valuation Summary
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Total Present Value of Revenue Interest Net Cash Flows
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$ | 21,220.7 | ||||||||||||||||||
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Terminal Value of Revenue Interest Net Cash Flows
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$ | 24,335.5 | ||||||||||||||||||
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Net Present Value of Revenue Interest
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$ | 45,556.2 | ||||||||||||||||||
* per Section 4.1B of EAM Declaration of Trust
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SEC Response
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Value Line, Inc.
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May 6, 2011 comment letter
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Page | 9
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EAM
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Calculation of Net Present Value of Non-Voting Profits Interest
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$ in thousands
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||||||||||||||||||||
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4/30/2011
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4/30/2012
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4/30/2013
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4/30/2014
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4/30/2015
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||||||||||||||||
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EBITDA
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$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
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less: Revenue Interest
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$ | 7,161.0 | $ | 8,900.0 | $ | 11,134.0 | $ | 14,423.0 | $ | 19,347.0 | ||||||||||
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Gross Profit Interest
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$ | 659.9 | $ | 1,051.0 | $ | 1,677.2 | $ | 2,461.4 | $ | 3,458.6 | ||||||||||
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Less : Depreciation and Amortization
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$ | (55.3 | ) | $ | (66.6 | ) | $ | (82.0 | ) | $ | (103.8 | ) | $ | (134.7 | ) | |||||
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Adjusted Gross Profit Interest
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$ | 604.6 | $ | 984.4 | $ | 1,595.2 | $ | 2,357.6 | $ | 3,323.9 | ||||||||||
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Income Tax (Expense) / Benefit
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$ | 229.7 | $ | 374.1 | $ | 606.2 | $ | 895.9 | $ | 1,263.1 | ||||||||||
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Tax Rate
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38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
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After Tax Profit Interest
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$ | 430.2 | $ | 676.9 | $ | 1,071.0 | $ | 1,565.5 | $ | 2,195.5 | ||||||||||
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less: Capital Expenditure
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$ | 55.3 | $ | 66.6 | $ | 82.0 | $ | 103.8 | $ | 134.7 | ||||||||||
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After Tax Profit Interest less Capital Expenditure
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$ | 374.9 | $ | 610.3 | $ | 989.0 | $ | 1,461.7 | $ | 2,060.8 | ||||||||||
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VLI Profit Interest % *
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50 | % | 50 | % | 50 | % | 50 | % | 50 | % | ||||||||||
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Net Cash Flow
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$ | 187.4 | $ | 305.2 | $ | 494.5 | $ | 730.9 | $ | 1,030.4 | ||||||||||
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Present Value of Revenue Interest Net Cash Flows
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||||||||||||||||||||
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Present Value Factor @ 23.0%
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0.9017 | 0.7331 | 0.5960 | 0.4845 | 0.3939 | |||||||||||||||
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Present Value of Net Cash Flows
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$ | 169.0 | $ | 223.7 | $ | 294.7 | $ | 354.1 | $ | 405.9 | ||||||||||
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Total Present Value of Profits Interest Net Cash Flows
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$ | 1,447.47 | ||
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Present Value of Terminal Revenue Interest Net Cash Flows:
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||||
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Terminal Period (Year 5 Net Cash Flow X Terminal Growth at 3.0%)
|
$ | 1,061.3 | ||
|
Capitalization Multiple
|
5.00 | x | ||
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Terminal Value
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$ | 5,306.6 | ||
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Present Value Factor @ 23.0%
|
0.3939 | |||
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Present Value of Terminal Profits Interest Net Cash Flows
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$ | 2,090.47 | ||
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Valuation Summary
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||||
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Total Present Value of Revenue Interest Net Cash Flows
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$ | 1,447.5 | ||
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Terminal Value of Revenue Interest Net Cash Flows
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$ | 2,090.5 | ||
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Net Present Value of Profits Interest
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$ | 3,537.9 |
* per Section 4.1B of EAM Declaration of Trust
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Value Line - Nonvoting Revenue and Profits Interest in EAM
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Summary
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$ in millions
|
||||
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Net Present Value of Revenue Interest
|
$ | 45,556.2 | ||
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Net Present Value of Profits Interest
|
3,537.9 | |||
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Total Value
|
49,094.1 | |||
The calculated value of the revenues interest was added to 50% of the calculated value of the operating profits interest to derive a value of $49.1M for VLI’s entire interest in EAM. The capital contributed of $7M was added to this derived value resulting in a fair value of $56.1M for VLI’s interest in EAM.
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SEC Response
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|
Value Line, Inc.
|
|
May 6, 2011 comment letter
|
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Page | 10
|
With respect to your query concerning the inclusion of the cash flows associated with our revenue interest in estimating the fair value of our interest in EAM, we note that in each of the projected financial results for EAM, the Company’s revenues interest (with which there are no corresponding expenses) constitutes at least 90% of the total cash flow to the Company. Furthermore, the Company has no expenses in relation to the balance of its cash flows. In these circumstances we believe that deduction of expenses would be inappropriate.”
Attached as exhibit 3, is a copy of the report prepared by the independent valuation firm, Madison Street Capital. We have also attached as exhibit 4 the worksheets used in the estimates in support of the discounted cash flow method.
|
|
4.
|
We note that you have included the $7 million of cash and liquid securities you contributed to EAM as part of your investment in EAM and in the determination of the gain recognized on deconsolidation. We also note the provision in Section 2.1 (b) of the Declaration of Trust the following statements:
|
Each of VLI And the Company acknowledges that at the time of the Conversion a portion of such monies relate to unused Rule 12b-1 Payments previously made by certain of the Funds to ESI, which portion will be reduced and eliminated over time through excess marketing payments being made by the Company.
Please tell us more about what these statements mean, including whether these payments are considered liabilities of EAM to the Funds. Please also tell us the amount of money that relates to these Rule 12b-l payments required to be reduced by future excess marketing payments of EAM. Finally, please tell us how you determined that the entire $7 million contribution represents excess capital that should be recognized as part of your investment in EAM and in the determination of the gain from deconsolidation.
Answer:
The statement above included in Section 2.1 (b) of the Declaration of Trust is an acknowledgement that EAM had historically received from the Value Line Funds under the compensation plans it had in place with the Funds amounts in excess of its actual expenditures and that in more recent years EAM has been spending amounts on promotion of the Value Line Funds in excess of the compensation received from the Funds. Over time EAM anticipates that its total future expenditures on such promotion will equal or exceed its total future revenues under the Funds’ distribution plans. EAM has no obligation in any circumstance to reimburse the Value Line Funds for any shortfall. The Funds do not have a receivable from the Distributor on their financial statements.
|
SEC Response
|
|
Value Line, Inc.
|
|
May 6, 2011 comment letter
|
|
Page | 11
|
The entire $7 million contribution to EAM by Value Line is considered excess capital. EAM is anticipated to earn enough profit to conduct its current and future operations, including excess marketing expenses for those Funds with 12b-1 fee waivers. Value Line determined to provide sufficient liquidity so that the management of EAM would not need to request additional funding from Value Line or anyone else at a later date. The $7 million was added to Value Line’s capital account at EAM and not assigned to any future operating expenses.
Lastly, the $7 million capital contribution made by Value Line to EAM is included as part of its investment in EAM and was not included in the determination of the gain from deconsolidation.
* * * * *
The Company acknowledges that it is responsible for the adequacy and accuracy of the disclosure in filings with the SEC. The Company understands and acknowledges that staff comments, or changes by the Company to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing. The Company understands that it may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Value Line appreciates the opportunity to submit this response to your office.
|
/s/ Howard A. Brecher
|
|
|
Howard A. Brecher, Acting Chief Executive
|
|
|
Officer, Principal Executive Officer
|
|
|
/s/ John A. McKay
|
|
|
John A. McKay, Chief Financial Officer, Principal
|
|
|
Financial Officer
|
|
|
/s/ Stephen R. Anastasio
|
|
|
Stephen R. Anastasio, Treasurer, Principal
|
|
|
Accounting Officer
|
|
SEC Response
|
|
Value Line, Inc.
|
|
May 6, 2011 comment letter
|
|
Page | 12
|
Via Edgar
Exhibit list to Value Line letter dated May 20, 2011 in response to the SEC Staff Comments letter dated May 6, 2011:
|
|
1.
|
Exhibit 1 – Value Line Memorandum
|
|
|
2.
|
Exhibit 2 – Financial Statements (unaudited) of EULAV Asset Management Trust, 3/31/2011
|
|
|
3.
|
Exhibit 3 – Madison Street Capital report.
|
|
|
4.
|
Exhibit 4 – Estimates in support of the discounted cash flow method
|
Exhibit 1
VALUE LINE, INC.
|
From:
|
Howard A. Brecher
|
|
Date:
|
May 3, 2011
|
The Declaration of Trust dated December 23, 2010, filed as Exhibit 10.16 to the Value Line, Inc. Form 10-Q filed on March 24, 2011, is the fundamental governing document of EULAV Asset Management (EAM) and defines the rights of persons with interests in the EAM
entity.
WHAT HAPPENS TO THE INTEREST OF MITCHELL APPEL IF HE DOES NOT VEST?
This situation is governed by Article VIII of the Declaration of Trust. Mr. Appel’s status is contemplated by Section 8.1(d) on pages 30 ff. because he is both an employee of EAM and a Shareholder (as that term is defined in the Declaration of Trust). Such an individual:
“shall, upon ceasing to be an employee for any reason, automatically and without any action by such person or the Company [EAM is “the Company”] forfeit without payment, the Unvested Percentage (or such higher percentage as the Trustees may determine at the time of grant of Voting Profits Interests to such person) of such person’s Voting Profits Interests, which shall thereupon be available for reissuance by the Company; provided, however, that such person shall not forfeit any portion of such person’s Capital Account.”
Article VIII goes on to explain that the vested portion may be acquired by EAM and that the capital account is not forfeited.
IS VALUE LINE’S INTEREST IN THE TRUST REDEEMABLE?
I am not aware of any provision giving Value Line the right to require EAM or anyone else to purchase Value Line’s interests, or any of its interests, in EAM.
FINANCIAL STATEMENTS OF THE TRUST (EAM)
Unaudited statements as of March 31, 2011, are attached.
IS VALUE LINE’S INTEREST IN THE TRUST CLASSIFIED AS EQUITY (in the
Trusts’s financial statements)?
Reference is made to Value Line’s letter dated March 31, 2011, addressed to the Commission. Answer 7 discusses this point.
Value Line’s interest in the Trust is an equity interest; Answer 7 addressed the question of what “percentage ownership of EAM’s overall equity” is held by Value Line. The Answer 7 explained that “Due to the materially different terms of the Company’s revenues interest and its non-voting profits interest, it is not possible to calculate the Company’s percentage ownership of EAM’s overall equity.”
The Trust’s financial statements reflect Value Line’s interest as a capital account.
ATTACHMENTS
|
Exhibit 2
|
EULAV Asset Management (Consolidated)
|
|
|
Balance Sheet
|
||
|
As of March 31, 2011 (unaudited)
|
|
Mar 31, 11
|
Feb 28, 11
|
$ Change
|
% Change
|
|||||||||||||
|
ASSETS
|
||||||||||||||||
|
Current Assets
|
||||||||||||||||
|
Checking/Savings
|
||||||||||||||||
|
Cash and Cash Equivalents
|
4,822,146.82 | 4,639,525.91 | 182,620.91 | 3.94 | % | |||||||||||
|
Total Checking/Savings
|
4,822,146.82 | 4,639,525.91 | 182,620.91 | 3.94 | % | |||||||||||
|
Accounts Receivable
|
||||||||||||||||
|
Afiliated Fees Receivable
|
1,415,636.56 | 1,293,339.92 | 122,296.64 | 9.46 | % | |||||||||||
|
Total Accounts Receivable
|
1,415,636.56 | 1,293,339.92 | 122,296.64 | 9.46 | % | |||||||||||
|
Other Current Assets
|
||||||||||||||||
|
Prepaid Exp/Other Current Asset
|
257,093.09 | 196,752.74 | 60,340.35 | 30.67 | % | |||||||||||
|
Securities Available for Sale
|
3,258,380.00 | 2,760,116.50 | 498,263.50 | 18.05 | % | |||||||||||
|
Total Other Current Assets
|
3,515,473.09 | 2,956,869.24 | 558,603.85 | 18.89 | % | |||||||||||
|
Total Current Assets
|
9,753,256.47 | 8,889,735.07 | 863,521.40 | 9.71 | % | |||||||||||
|
Fixed Assets
|
||||||||||||||||
|
Property & Equipment, net
|
17,719.76 | 16,874.26 | 845.50 | 5.01 | % | |||||||||||
|
Total Fixed Assets
|
17,719.76 | 16,874.26 | 845.50 | 5.01 | % | |||||||||||
|
Other Assets
|
||||||||||||||||
|
Intangible Long Term Assets
|
49,197,116.71 | 49,197,116.71 | 0.00 | 0.0 | % | |||||||||||
|
Total Other Assets
|
49,197,116.71 | 49,197,116.71 | 0.00 | 0.0 | % | |||||||||||
|
TOTAL ASSETS
|
58,968,092.94 | 58,103,726.04 | 864,366.90 | 1.49 | % | |||||||||||
|
LIABILITIES & EQUITY
|
||||||||||||||||
|
Liabilities
|
||||||||||||||||
|
Current Liabilities
|
||||||||||||||||
|
Accounts Payable
|
||||||||||||||||
|
Accounts Payable
|
1,599,169.94 | 1,027,388.17 | 571,781.77 | 55.65 | % | |||||||||||
|
Total Accounts Payable
|
1,599,169.94 | 1,027,388.17 | 571,781.77 | 55.65 | % | |||||||||||
|
Other Current Liabilities
|
||||||||||||||||
|
Accrued Liabilities
|
1,030,917.41 | 853,074.55 | 177,842.86 | 20.85 | % | |||||||||||
|
Total Other Current Liabilities
|
1,030,917.41 | 853,074.55 | 177,842.86 | 20.85 | % | |||||||||||
|
Total Current Liabilities
|
2,630,087.35 | 1,880,462.72 | 749,624.63 | 39.86 | % | |||||||||||
|
Total Liabilities
|
2,630,087.35 | 1,880,462.72 | 749,624.63 | 39.86 | % | |||||||||||
|
Equity
|
||||||||||||||||
|
Capital Accounts
|
56,072,891.80 | 56,072,891.80 | 0.00 | 0.0 | % | |||||||||||
|
Unrealized Gain/(Loss) on Inv
|
(1,387.84 | ) | 0.00 | (1,387.84 | ) | (100.0 | )% | |||||||||
|
Net Income
|
266,501.63 | 150,371.52 | 116,130.11 | 77.23 | % | |||||||||||
|
Total Equity
|
56,338,005.59 | 56,223,263.32 | 114,742.27 | 0.2 | % | |||||||||||
|
TOTAL LIABILITIES & EQUITY
|
58,968,092.94 | 58,103,726.04 | 864,366.90 | 1.49 | % | |||||||||||
Page 1 of 1
|
Exhibit 2
|
EULAV Asset Management (Consolidated)
|
|
|
Profit && Loss
|
||
|
March 2011 (unaudited)
|
|
Mar 11
|
Feb 11
|
$ Change
|
% Change
|
Dec 23 '10 - Mar 11
|
% of Income
|
|||||||||||||||||||
|
Income
|
||||||||||||||||||||||||
|
Management Fees
|
1,104,273.69 | 1,009,623.48 | 94,650.21 | 9.38 | % | 3,502,067.40 | 77.87 | % | ||||||||||||||||
|
12b1 Fees
|
311,362.87 | 283,716.44 | 27,646.43 | 9.74 | % | 984,580.12 | 21.96 | % | ||||||||||||||||
|
Dividend and Interest Income
|
2,585.89 | 25.91 | 2,559.98 | 9,880.28 | % | 2,669.53 | 0.18 | % | ||||||||||||||||
|
Gain/(Loss) on Securities
|
(117.76 | ) | 781.36 | (899.12 | ) | (115.07 | )% | 0.00 | (0.01 | )% | ||||||||||||||
|
Total Income
|
1,418,104.69 | 1,294,147.19 | 123,957.50 | 9.58 | % | 4,489,317.05 | 100.0 | % | ||||||||||||||||
|
Revenue Offset
|
||||||||||||||||||||||||
|
Revenue Distribution
|
526,952.85 | 481,786.33 | 45,166.52 | 9.38 | % | 1,673,352.02 | 37.16 | % | ||||||||||||||||
|
Total Revenue Offset
|
526,952.85 | 481,786.33 | 45,166.52 | 9.38 | % | 1,673,352.02 | 37.16 | % | ||||||||||||||||
|
Gross Profit
|
891,151.84 | 812,360.86 | 78,790.98 | 9.7 | % | 2,815,965.03 | 62.84 | % | ||||||||||||||||
|
Expense
|
||||||||||||||||||||||||
|
Marketing & Distribution
|
312,501.63 | 348,737.07 | (36,235.44 | ) | (10.39 | )% | 1,120,440.85 | 22.04 | % | |||||||||||||||
|
Office and Administration
|
231,444.81 | 200,744.52 | 30,700.29 | 15.29 | % | 693,033.30 | 16.32 | % | ||||||||||||||||
|
Compensation and Benefits
|
186,704.87 | 186,813.60 | (108.73 | ) | (0.06 | )% | 590,211.37 | 13.17 | % | |||||||||||||||
|
Overhead Allocation
|
44,000.00 | 44,000.00 | 0.00 | 0.0 | % | 144,774.19 | 3.1 | % | ||||||||||||||||
|
Depreciation/Amortization
|
370.42 | 370.41 | 0.01 | 0.0 | % | 1,003.69 | 0.03 | % | ||||||||||||||||
|
Total Expense
|
775,021.73 | 780,665.60 | (5,643.87 | ) | (0.72 | )% | 2,549,463.40 | 54.65 | % | |||||||||||||||
|
Net Income
|
116,130.11 | 31,695.26 | 84,434.85 | 266.4 | % | 266,501.63 | 8.19 | % | ||||||||||||||||
Page 1 of 1
Exhibit 3
Exhibit 3
VLI’s Voting Profits Interests - Supporting Schedules
|
Table of Contents
|
||
|
SECTION 1
|
Pro forma Income Statement
|
4
|
|
SECTION 2
|
Voting Profits Interests
|
6
|
|
SECTION 3
|
Discount Rate
|
8
|
|
SECTION 4
|
Summary
|
11
|
2
Exhibit 3
Preface
This material has been compiled by Madison Street Capital Advisors LLC (“MSC”) in support of certain financial reporting disclosures made by Value Line Inc. (the “Company”). The schedules contained herein are confidential and for the use of the Company. Any publication or use of this material or the analyses contained herein without the express written consent of MSC is strictly prohibited. MSC received business and financial information provided by the Company and has not independently verified any such information and has relied on all such information as being complete and accurate in all material respects.
These schedules being delivered to management of the Company is a recalculation and is not an opinion. No officer, director, employee, agent, shareholder, or controlling person of MSC or any of its affiliates shall be subjected to any personal liability whatsoever to any neither person, nor will any such claim be asserted by or on behalf of you or your affiliates against any such person with respect to this material.
3
Exhibit 3
SECTION 1
Pro forma Income Statement
4
Exhibit 3
Pro forma Income Statement
|
EAM
|
|
Pro forma Income Statement*
|
|
$ in thousands
|
||||||||||||||||||||
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
||||||||||||||||
|
Mutual Fund Revenues
|
$ | 14,424.7 | $ | 17,435.7 | $ | 21,425.6 | $ | 27,056.3 | $ | 35,026.0 | ||||||||||
|
Asset Management Fees
|
$ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | ||||||||||
|
12b-1 Fees
|
$ | 4,108.8 | $ | 4,910.2 | $ | 6,133.1 | $ | 7,862.3 | $ | 10,350.1 | ||||||||||
|
Total Revenue
|
$ | 18,683.2 | $ | 22,495.6 | $ | 27,708.4 | $ | 35,068.3 | $ | 45,525.8 | ||||||||||
|
Revenue Growth
|
7.3 | % | 20.4 | % | 23.2 | % | 26.6 | % | 29.8 | % | ||||||||||
|
Marketing and Promotion-supermarket fees
|
$ | 5,000.2 | $ | 6,036.3 | $ | 7,404.0 | $ | 9,389.3 | $ | 12,116.4 | ||||||||||
|
Marketing and Promotion-other
|
121.7 | 124.4 | 127.1 | 129.9 | 132.8 | |||||||||||||||
|
Salary and Benefits
|
3,862.2 | 4,396.4 | 5,393.8 | 6,801.5 | 8,793.9 | |||||||||||||||
|
Office and Administration
|
1,657.5 | 1,772.1 | 1,766.0 | 1,672.4 | 1,510.7 | |||||||||||||||
|
Overhead
|
275.9 | 282.0 | 288.2 | 294.6 | 301.0 | |||||||||||||||
|
Expenses
|
10,862.3 | 12,544.6 | 14,897.3 | 18,184.0 | 22,720.2 | |||||||||||||||
|
Depreciation and Amortization
|
55.3 | 66.6 | 82.0 | 103.8 | 134.7 | |||||||||||||||
|
Total Expenses
|
$ | 10,917.6 | $ | 12,611.2 | $ | 14,979.2 | $ | 18,287.7 | $ | 22,854.9 | ||||||||||
|
Operating Profit
|
$ | 7,765.6 | $ | 9,884.4 | $ | 12,729.2 | $ | 16,780.6 | $ | 22,670.9 | ||||||||||
|
Operating Margin
|
41.6 | % | 43.9 | % | 45.9 | % | 47.9 | % | 49.8 | % | ||||||||||
|
Income Tax (Expense) / Benefit
|
$ | 2,950.9 | $ | 3,756.1 | $ | 4,837.1 | $ | 6,376.6 | $ | 8,615.0 | ||||||||||
|
Tax Rate
|
38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
|
Net Income
|
$ | 4,814.7 | $ | 6,128.3 | $ | 7,892.1 | $ | 10,404.0 | $ | 14,056.0 | ||||||||||
|
Net Income Margin
|
25.8 | % | 27.2 | % | 28.5 | % | 29.7 | % | 30.9 | % | ||||||||||
|
EBITDA
|
$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
|
EBITDA Margin
|
41.9 | % | 44.2 | % | 46.2 | % | 48.1 | % | 50.1 | % | ||||||||||
* per prior analysis performed by other independent valuation firm
5
Exhibit 3
SECTION 3
Voting Profits Interests
6
Exhibit 3
Voting Profits Interests
|
EAM
|
|
Calculation of Net Present Value of Voting Profits Interests
|
|
$ in thousands
|
||||||||||||||||||||
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
||||||||||||||||
|
EBITDA
|
$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
|
less: Revenue Interest*
|
$ | 7,161.0 | $ | 8,900.0 | $ | 11,134.0 | $ | 14,423.0 | $ | 19,347.0 | ||||||||||
|
Gross Profits Interests
|
$ | 659.9 | $ | 1,051.0 | $ | 1,677.2 | $ | 2,461.4 | $ | 3,458.6 | ||||||||||
|
Income Tax Expense
|
$ | 250.8 | $ | 399.4 | $ | 637.3 | $ | 935.3 | $ | 1,314.3 | ||||||||||
|
Tax Rate
|
38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
|
After Tax Profits Interests
|
$ | 409.1 | $ | 651.6 | $ | 1,039.9 | $ | 1,526.1 | $ | 2,144.3 | ||||||||||
|
less: Capital Expenditure
|
$ | 55.3 | $ | 66.6 | $ | 82.0 | $ | 103.8 | $ | 134.7 | ||||||||||
|
After Tax Profits Interests less Capital Expenditure
|
$ | 353.8 | $ | 585.0 | $ | 957.9 | $ | 1,422.3 | $ | 2,009.6 | ||||||||||
|
Voting Profits Interests % *
|
45 | % | 45 | % | 45 | % | 45 | % | 45 | % | ||||||||||
|
Net Cash Flow
|
$ | 159.2 | $ | 263.3 | $ | 431.0 | $ | 640.0 | $ | 904.3 | ||||||||||
|
Present Value of Profits Interests Net Cash Flows
|
||||||||||||||||||||
|
Present Value Factor @ 40.0%
|
0.8452 | 0.6037 | 0.4312 | 0.3080 | 0.2200 | |||||||||||||||
|
Present Value of Net Cash Flows
|
$ | 134.6 | $ | 158.9 | $ | 185.9 | $ | 197.1 | $ | 199.0 | ||||||||||
|
Total Present Value of Profits Interests Net Cash Flows
|
875 | |||||||||||||||||||
|
Present Value of Terminal Profits Interests Net Cash Flows:
|
||||||||||||||||||||
|
Terminal Period (Year 5 Net Cash Flow X Terminal Growth at 3.0%)
|
$ | 931.5 | ||||||||||||||||||
|
Capitalization Multiple
|
2.70 | x | ||||||||||||||||||
|
Terminal Value
|
$ | 2,517.5 | ||||||||||||||||||
|
Present Value Factor @ 40.0%
|
0.2200 | |||||||||||||||||||
|
Present Value of Terminal Profits Interests Net Cash Flows
|
$ | 553.8 | ||||||||||||||||||
|
Valuation Summary
|
||||||||||||||||||||
|
Total Present Value of Profits Interests Net Cash Flows
|
$ | 875.4 | ||||||||||||||||||
|
Terminal Value of Profits Interests Net Cash Flows
|
$ | 553.8 | ||||||||||||||||||
|
Net Present Value of Voting Profits Interests
|
$ | 1,429.3 | ||||||||||||||||||
|
* See Supporting Schedules for VLI's Non-Voting Revenue and Profits Interests
|
|
** per Section 4.1B of EAM Declaration of Trust
|
7
Exhibit 3
SECTION 4
Discount Rate
8
Exhibit 3
Discount Rate
Discount Rate Support
A discount rate was applied to derive the present value of the cash flows associated with the Revenue and Profits Interests. The required rate of return applied was the Company's weighted average cost of capital (“WACC”). The discount rate applied to the forecasted cash flows and terminal value must adequately reflect the nature of the subject investment and the risk of the underlying cash flows. The appropriate discount rate is a WACC, calculated using estimates of required equity rates of return for the Company. In order to estimate an appropriate weighted average rate of return, the build-up method and applied it to the WACC as follows:
EAM
Weighted Average Cost of Capital
Estimating the Cost of Capital - Buildup Method
|
Cost of Equity Estimate:
|
||||
|
Riskless Rate 1
|
3.89 | % | ||
|
Equity Risk Premium 2
|
5.45 | % | ||
|
Industry Risk Premium 3
|
4.62 | % | ||
|
Size Premium 4
|
6.00 | % | ||
|
Additional Risk factors 5
|
20.00 | % | ||
|
Cost of Equity Estimate
|
39.96 | % | ||
|
Cost of Debt Capital:
|
||||
|
Cost of Debt 6
|
0.00 | % | ||
|
Tax Rate
|
38.00 | % | ||
|
After-tax Debt Rate
|
0.00 | % | ||
|
Targeted Capital Structure: 7
|
||||
|
Equity / Enterprise Value
|
100.00 | % | ||
|
Debt / Enterprise Value
|
0.00 | % | ||
|
Total Enterprise Value
|
100.00 | % | ||
|
WACC (Rounded)
|
40.00 | % | ||
|
1
|
Long-Term (30-year) U.S. Treasury Coupon Bond Yield - as of 06/30/2010
|
|
2
|
Long-Run Stock Returns: Participating in the Real Economy - Ibbotson and Chen, 2007
|
|
3
|
IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010 SIC 6282: Miscellaneous
|
|
4
|
IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010
|
|
5
|
Additional risk factor specific to the nature of EAM trust agreement as it pertains to Shareholder of Voting Profits Interests (see next page)
|
|
6
|
Cost of debt is an estimate of Value Line's marginal interest rate.
|
|
7
|
Targeted Capital Structure is based upon the anticipated capital structure of EAM
|
9
Exhibit 3
Discount Rate – Additional Risk Factors
The following points were applied to the Additional Risk factors component of the discount rate:
· Voting member would lose position as a Trustee if the other 4 voting profits interests holders vote for his removal.
· Voting member does not have authority to use more than 5% of EAM’s assets without concurrence of at least 2 of the other 4 Trustees.
· Voting Member cannot take any of the following actions without VLI’s approval:
|
|
1.
|
Any merger, consolidation, acquisition, partnership, joint venture or other business combination that exceeds 20% of the aggregate Capital Accounts of the EAM Shareholders.
|
|
|
2.
|
Any sale, lease, assignment of other disposition by EAM that exceeds 20% of the aggregate Capital Accounts of the EAM Shareholders during any 36 month period.
|
|
|
3.
|
Borrow more than 1% of Gross Revenues of EAM (borrowing limited to $200,000).
|
|
|
4.
|
Pledge EAM assets.
|
|
|
5.
|
Dilute VLI’s interests or issue voting interests to cause an assignment of Funds’ contracts.
|
|
|
6.
|
Declare bankruptcy.
|
|
|
7.
|
Engage in related party transactions.
|
|
|
8.
|
Enter into other lines of business.
|
|
|
9.
|
Materially change tax or accounting policies.
|
· Distribution Restriction - There cannot be distributions made out of the VLI's capital account ($700,000 minimum balance requirement)
· Transferability Restriction – Voting member is not permitted to transfer his interest without the consent of the Board of Trustees – he is 1 vote out of 5 on the Board. If Voting member withdraws as Voting Profits Interests holder, he forfeits unvested profits interests.
· Vesting Restriction - Vesting takes 10 years. Even after 10 years, if Voting member resigns the maximum vesting in effect is 49%, not 100%. Further, if terminated before 4 years with EAM, there is zero vesting.
· Exit Restriction - EAM has the right to repurchase Voting member’s vested interest at a price which is 2 x Last Year’s Profit attributable to Voting member x Vested %.
10
Exhibit 3
SECTION 4
Summary
11
Exhibit 3
Summary
Value Line - Voting Member's Profits Interests in EAM
Summary
|
$ in millions
|
||||
|
Net Present Value of Profits Interest
|
1,429.3 | |||
|
Total Value
|
1,429.3 | |||
12
Exhibit 3
Exhibit 3
VLI’s Non-Voting Revenue and Profits Interests - Supporting Schedules
Table of Contents
|
SECTION 1
|
Pro forma Income Statement
|
4
|
|
SECTION 2
|
Non-Voting Revenue Interest
|
6
|
|
SECTION 3
|
Non-Voting Profits Interests
|
8
|
|
SECTION 4
|
Discount Rate
|
10
|
|
SECTION 5
|
Summary
|
12
|
2
Exhibit 3
Preface
This material has been compiled by Madison Street Capital Advisors LLC (“MSC”) in support of certain financial reporting disclosures made by Value Line Inc. (the “Company”). The schedules contained herein are confidential and for the use of the Company. Any publication or use of this material or the analyses contained herein without the express written consent of MSC is strictly prohibited. MSC received business and financial information provided by the Company and has not independently verified any such information and has relied on all such information as being complete and accurate in all material respects.
These schedules being delivered to management of the Company is a recalculation and is not an opinion. No officer, director, employee, agent, shareholder, or controlling person of MSC or any of its affiliates shall be subjected to any personal liability whatsoever to any neither person, nor will any such claim be asserted by or on behalf of you or your affiliates against any such person with respect to this material.
3
Exhibit 3
SECTION 1
Pro forma Income Statement
4
Exhibit 3
Pro forma Income Statement
EAM
Pro forma Income Statement
|
$ in thousands
|
||||||||||||||||||||
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
||||||||||||||||
|
Mutual Fund Revenues
|
$ | 14,424.7 | $ | 17,435.7 | $ | 21,425.6 | $ | 27,056.3 | $ | 35,026.0 | ||||||||||
|
Asset Management Fees
|
$ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | ||||||||||
|
12b-1 Fees
|
$ | 4,108.8 | $ | 4,910.2 | $ | 6,133.1 | $ | 7,862.3 | $ | 10,350.1 | ||||||||||
|
Total Revenue
|
$ | 18,683.2 | $ | 22,495.6 | $ | 27,708.4 | $ | 35,068.3 | $ | 45,525.8 | ||||||||||
|
Revenue Growth
|
7.3 | % | 20.4 | % | 23.2 | % | 26.6 | % | 29.8 | % | ||||||||||
|
Marketing and Promotion-supermarket fees
|
$ | 5,000.2 | $ | 6,036.3 | $ | 7,404.0 | $ | 9,389.3 | $ | 12,116.4 | ||||||||||
|
Marketing and Promotion-other
|
121.7 | $ | 124.4 | $ | 127.1 | $ | 129.9 | $ | 132.8 | |||||||||||
|
Salary and Benefits
|
3,862.2 | 4,396.4 | 5,393.8 | 6,801.5 | 8,793.9 | |||||||||||||||
|
Office and Adminstration
|
1,657.5 | 1,772.1 | 1,766.0 | 1,672.4 | 1,510.7 | |||||||||||||||
|
Overhead
|
275.9 | 282.0 | 288.2 | 294.6 | 301.0 | |||||||||||||||
|
Expenses
|
10,862.3 | 12,544.6 | 14,897.3 | 18,184.0 | 22,720.2 | |||||||||||||||
|
Depreciation and Amortization
|
55.3 | 66.6 | 82.0 | 103.8 | 134.7 | |||||||||||||||
|
Total Expenses
|
$ | 10,917.6 | $ | 12,611.2 | $ | 14,979.2 | $ | 18,287.7 | $ | 22,854.9 | ||||||||||
|
Operating Profit
|
$ | 7,765.6 | $ | 9,884.4 | $ | 12,729.2 | $ | 16,780.6 | $ | 22,670.9 | ||||||||||
|
Operating Margin
|
41.6 | % | 43.9 | % | 45.9 | % | 47.9 | % | 49.8 | % | ||||||||||
|
Income Tax (Expense) / Benefit
|
$ | 2,950.9 | $ | 3,756.1 | $ | 4,837.1 | $ | 6,376.6 | $ | 8,615.0 | ||||||||||
|
Tax Rate
|
38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
|
Net Income
|
$ | 4,814.7 | $ | 6,128.3 | $ | 7,892.1 | $ | 10,404.0 | $ | 14,056.0 | ||||||||||
|
Net Income Margin
|
25.8 | % | 27.2 | % | 28.5 | % | 29.7 | % | 30.9 | % | ||||||||||
|
EBITDA
|
$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
|
EBITDA Margin
|
41.9 | % | 44.2 | % | 46.2 | % | 48.1 | % | 50.1 | % | ||||||||||
5
Exhibit 3
SECTION 2
Non-Voting Revenue Interest
6
Exhibit 3
Non-Voting Revenue Interest
EAM
Calculation of Net Present Value of Revenue Interest
|
$ in thousands
|
||||||||||||||||||||
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
||||||||||||||||
|
Mutual Fund Revenues
|
$ | 14,424.7 | $ | 17,435.7 | $ | 21,425.6 | $ | 27,056.3 | $ | 35,026.0 | ||||||||||
|
Asset Management Fees
|
$ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | $ | 149.7 | ||||||||||
|
Total Revenue
|
$ | 14,574.4 | $ | 17,585.4 | $ | 21,575.3 | $ | 27,206.0 | $ | 35,175.7 | ||||||||||
|
VLI Revenue Interest % *
|
49.13 | % | 50.61 | % | 51.61 | % | 53.01 | % | 55.00 | % | ||||||||||
|
VLI Revenue Interest
|
$ | 7,161.0 | $ | 8,900.0 | $ | 11,134.0 | $ | 14,423.0 | $ | 19,347.0 | ||||||||||
|
Income Tax (Expense) / Benefit
|
$ | 2,721.2 | $ | 3,382.0 | $ | 4,230.9 | $ | 5,480.7 | $ | 7,351.9 | ||||||||||
|
Tax Rate
|
38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
|
Net Cash Flow
|
$ | 4,439.8 | $ | 5,518.0 | $ | 6,903.1 | $ | 8,942.3 | $ | 11,995.1 | ||||||||||
|
Present Value of Revenue Interest Net Cash Flows
|
||||||||||||||||||||
|
Present Value Factor @ 23.0%
|
0.9017 | 0.7331 | 0.5960 | 0.4845 | 0.3939 | |||||||||||||||
|
Present Value of Net Cash Flows
|
$ | 4,003.3 | $ | 4,045.1 | $ | 4,114.2 | $ | 4,332.9 | $ | 4,725.3 | ||||||||||
|
Total Present Value of Revenue Interest Net Cash Flows
|
$ | 21,220.69 | ||||||||||||||||||
|
Present Value of Terminal Revenue Interest Net Cash Flows:
|
||||||||||||||||||||
|
Terminal Period (Year 5 Net Cash Flow X Terminal Growth at 3.0%)
|
$ | 12,355.0 | ||||||||||||||||||
|
Capitalization Multiple
|
5.00 | x | ||||||||||||||||||
|
Terminal Value
|
$ | 61,775.0 | ||||||||||||||||||
|
Present Value Factor @ 23.0%
|
0.3939 | |||||||||||||||||||
|
Present Value of Terminal Revenue Interest Net Cash Flows
|
$ | 24,335.46 | ||||||||||||||||||
|
Valuation Summary
|
||||||||||||||||||||
|
Total Present Value of Revenue Interest Net Cash Flows
|
$ | 21,220.7 | ||||||||||||||||||
|
Terminal Value of Revenue Interest Net Cash Flows
|
$ | 24,335.5 | ||||||||||||||||||
|
Net Present Value of Revenue Interest
|
$ | 45,556.2 | ||||||||||||||||||
* per Section 4.1B of EAM Declaration of Trust
7
Exhibit 3
SECTION 3
Non-Voting Profits Interests
8
Exhibit 3
Non-Voting Profits Interest
EAM
Calculation of Net Present Value of Profits Interests
|
$ in thousands
|
||||||||||||||||||||
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
||||||||||||||||
|
EBITDA
|
$ | 7,820.9 | $ | 9,951.0 | $ | 12,811.2 | $ | 16,884.4 | $ | 22,805.6 | ||||||||||
|
less: Revenue Interest
|
$ | 7,161.0 | $ | 8,900.0 | $ | 11,134.0 | $ | 14,423.0 | $ | 19,347.0 | ||||||||||
|
Gross Profits Interests
|
$ | 659.9 | $ | 1,051.0 | $ | 1,677.2 | $ | 2,461.4 | $ | 3,458.6 | ||||||||||
|
Less : Depreciation and Amortization
|
$ | (55.3 | ) | $ | (66.6 | ) | $ | (82.0 | ) | $ | (103.8 | ) | $ | (134.7 | ) | |||||
|
Adjusted Gross Profits Interests
|
$ | 604.6 | $ | 984.4 | $ | 1,595.2 | $ | 2,357.6 | $ | 3,323.9 | ||||||||||
|
Income Tax (Expense) / Benefit
|
$ | 229.7 | $ | 374.1 | $ | 606.2 | $ | 895.9 | $ | 1,263.1 | ||||||||||
|
Tax Rate
|
38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | 38.0 | % | ||||||||||
|
After Tax Profits Interests
|
$ | 430.2 | $ | 676.9 | $ | 1,071.0 | $ | 1,565.5 | $ | 2,195.5 | ||||||||||
|
less: Capital Expenditure
|
$ | 55.3 | $ | 66.6 | $ | 82.0 | $ | 103.8 | $ | 134.7 | ||||||||||
|
After Tax Profits Interests less Capital Expenditure
|
$ | 374.9 | $ | 610.3 | $ | 989.0 | $ | 1,461.7 | $ | 2,060.8 | ||||||||||
|
VLI Profits Interests % *
|
50 | % | 50 | % | 50 | % | 50 | % | 50 | % | ||||||||||
|
Net Cash Flow
|
$ | 187.4 | $ | 305.2 | $ | 494.5 | $ | 730.9 | $ | 1,030.4 | ||||||||||
|
Present Value of Profits Interests Net Cash Flows
|
||||||||||||||||||||
|
Present Value Factor @ 23.0%
|
0.9017 | 0.7331 | 0.5960 | 0.4845 | 0.3939 | |||||||||||||||
|
Present Value of Net Cash Flows
|
$ | 169.0 | $ | 223.7 | $ | 294.7 | $ | 354.1 | $ | 405.9 | ||||||||||
|
Total Present Value of Profits Interests Net Cash Flows
|
$ | 1,447.47 | ||||||||||||||||||
|
Present Value of Terminal Profits Interests Net Cash Flows:
|
||||||||||||||||||||
|
Terminal Period (Year 5 Net Cash Flow X Terminal Growth at 3.0%)
|
$ | 1,061.3 | ||||||||||||||||||
|
Capitalization Multiple
|
5.00 | x | ||||||||||||||||||
|
Terminal Value
|
$ | 5,306.6 | ||||||||||||||||||
|
Present Value Factor @ 23.0%
|
0.3939 | |||||||||||||||||||
|
Present Value of Terminal Profits Interests Net Cash Flows
|
$ | 2,090.47 | ||||||||||||||||||
|
Valuation Summary
|
||||||||||||||||||||
|
Total Present Value of Profits Interests Net Cash Flows
|
$ | 1,447.5 | ||||||||||||||||||
|
Terminal Value of Profits Interests Net Cash Flows
|
$ | 2,090.5 | ||||||||||||||||||
|
Net Present Value of Profits Interests
|
$ | 3,537.9 | ||||||||||||||||||
* per Section 4.1B of EAM Declaration of Trust
9
Exhibit 3
SECTION 4
Discount Rate
10
Exhibit 3
Discount Rate
Discount Rate Support
A discount rate was applied to derive the present value of the cash flows associated with the Revenue and Profits Interests. The required rate of return applied was the Company's weighted average cost of capital (“WACC”). The discount rate applied to the forecasted cash flows and terminal value must adequately reflect the nature of the subject investment and the risk of the underlying cash flows. The appropriate discount rate is a WACC, calculated using estimates of required equity rates of return for the Company. In order to estimate an appropriate weighted average rate of return, the build-up method and applied it to the WACC as follows:
EAM
Weighted Average Cost of Capital
Estimating the Cost of Capital - Buildup Method
|
Cost of Equity Estimate:
|
||||
|
Riskless Rate 1
|
3.89 | % | ||
|
Equity Risk Premium 2
|
5.45 | % | ||
|
Industry Risk Premium 3
|
4.62 | % | ||
|
Size Premium 4
|
6.00 | % | ||
|
Additional Risk factor 5
|
3.00 | % | ||
|
Cost of Equity Estimate
|
22.96 | % | ||
|
Cost of Debt Capital:
|
||||
|
Cost of Debt 6
|
0.00 | % | ||
|
Tax Rate
|
38.00 | % | ||
|
After-tax Debt Rate
|
0.00 | % | ||
|
Targeted Capital Structure: 7
|
||||
|
Equity / Enterprise Value
|
100.00 | % | ||
|
Debt / Enterprise Value
|
0.00 | % | ||
|
Total Enterprise Value
|
100.00 | % | ||
|
WACC (Rounded)
|
23.00 | % | ||
1 Long-Term (30-year) U.S. Treasury Coupon Bond Yield - as of 06/30/2010
2 Long-Run Stock Returns: Participating in the Real Economy - Ibbotson and Chen, 2007
3 IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010 SIC 6282: Investment Advice
4 IbbotsonAssociates: Stocks, Bonds, Bills and Inflation 2010
5 Additional risk factor specific to the nature of EAM trust agreement as it pertains to Shareholder of Non Voting Revenue & Profits Interests
6 Cost of debt is an estimate of Value Line's marginal interest rate.
7 Targeted Capital Structure is based upon the anticipated capital structure of EAM
11
Exhibit 3
SECTION 4
Summary
12
Exhibit 3
Summary
Value Line - Nonvoting Revenue and Profits Interests in EAM
Summary
$ in millions
|
Net Present Value of Revenue Interest
|
$ | 45,556.2 | ||
|
Net Present Value of Profits Interests
|
3,537.9 | |||
|
Total Value
|
49,094.1 |
13
Exhibit 4
|
Annualized
|
Annualized
|
Annualized
|
Annualized
|
Annualized
|
Annualized
|
|||||||||||||||||||
|
4/30/2010
|
4/30/2011
|
4/30/2012
|
4/30/2013
|
4/30/2014
|
4/30/2015
|
|||||||||||||||||||
|
Percentage change in Assets from prior year
|
0.00 | % | 9.97 | % | 20.72 | % | 22.66 | % | 26.81 | % | 29.04 | % | ||||||||||||
|
Revenue Distribution
|
47.70 | % | 49.14 | % | 50.61 | % | 51.61 | % | 53.01 | % | 55.00 | % | ||||||||||||
|
Rate of Inflation
|
0.00 | % | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | ||||||||||||
|
Mutual Fund Revenues
|
$ | 13,469,327 | $ | 14,424,699 | $ | 17,435,729 | $ | 21,425,642 | $ | 27,056,329 | $ | 35,026,003 | ||||||||||||
|
Asset Mgmt Fees
|
$ | 149,724 | $ | 149,724 | $ | 149,724 | $ | 149,724 | $ | 149,724 | $ | 149,724 | ||||||||||||
|
12b-1 Fees
|
$ | 3,800,621 | $ | 4,108,769 | $ | 4,910,182 | $ | 6,133,131 | $ | 7,862,292 | $ | 10,350,084 | ||||||||||||
|
Total Revenues
|
$ | 17,419,672 | $ | 18,683,192 | $ | 22,495,635 | $ | 27,708,497 | $ | 35,068,344 | $ | 45,525,810 | ||||||||||||
|
Direct Account Assets
|
$ | 1,056,970,000 | $ | 1,170,024,047 | $ | 1,311,178,202 | $ | 1,462,357,202 | $ | 1,688,647,695 | $ | 1,946,687,708 | ||||||||||||
|
Supermarket Assets
|
$ | 718,027,000 | $ | 783,608,848 | $ | 1,057,511,157 | $ | 1,494,193,208 | $ | 2,123,330,292 | $ | 3,047,165,653 | ||||||||||||
|
Guardian Annuity Assets
|
$ | 475,003,000 | $ | 520,720,664 | $ | 618,398,426 | $ | 707,347,731 | $ | 834,345,132 | $ | 1,001,985,645 | ||||||||||||
|
Total Assets
|
$ | 2,250,000,000 | $ | 2,474,353,559 | $ | 2,987,087,786 | $ | 3,663,898,141 | $ | 4,646,323,119 | $ | 5,995,839,006 | ||||||||||||
|
avg. fee = 76-77 bp
|
avg. fee = 76-77 bp
|
avg. fee = 76-77 bp
|
avg. fee = 76-77 bp
|
avg. fee = 76-77 bp
|
avg. fee = 76-77 bp
|
|||||||||||||||||||
Exhibit 4
SCHEDULE OF ASSETS, MGT FEES, and 12b1 FEES-Fiscal 2011
|
assets5/1/10
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
YTD
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Assets By Fund
|
% Change
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
10.00 | % | 37,003,098 | 37,311,457 | 37,622,386 | 37,935,906 | 38,252,039 | 38,570,806 | 38,892,229 | 39,216,331 | 39,543,134 | 39,872,660 | 40,204,932 | 40,539,973 | 40,877,806 | 40,877,806 | ||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
10.00 | % | 58,355,106 | 58,841,399 | 59,331,744 | 59,826,175 | 60,324,726 | 60,827,432 | 61,334,328 | 61,845,447 | 62,360,826 | 62,880,499 | 63,404,503 | 63,932,874 | 64,465,648 | 64,465,648 | ||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
-15.00 | % | 125,000,000 | 123,437,500 | 121,894,531 | 120,370,850 | 118,866,214 | 117,380,386 | 115,913,131 | 114,464,217 | 113,033,415 | 111,620,497 | 110,225,241 | 108,847,425 | 107,486,832 | 107,486,832 | ||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
8.00 | % | 128,896,324 | 129,755,633 | 130,620,670 | 131,491,475 | 132,368,085 | 133,250,539 | 134,138,876 | 135,033,135 | 135,933,356 | 136,839,578 | 137,751,842 | 138,670,187 | 139,594,655 | 139,594,655 | ||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
5.00 | % | 25,884,274 | 25,992,125 | 26,100,426 | 26,209,177 | 26,318,382 | 26,428,042 | 26,538,159 | 26,648,735 | 26,759,771 | 26,871,270 | 26,983,234 | 27,095,664 | 27,208,563 | 27,208,563 | ||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
19.00 | % | 395,000,000 | 401,254,167 | 407,607,358 | 414,061,141 | 420,617,109 | 427,276,880 | 434,042,097 | 440,914,430 | 447,895,575 | 454,987,255 | 462,191,220 | 469,509,248 | 476,943,144 | 476,943,144 | ||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
10.00 | % | 331,000,000 | 333,758,333 | 336,539,653 | 339,344,150 | 342,172,018 | 345,023,451 | 347,898,647 | 350,797,802 | 353,721,117 | 356,668,793 | 359,641,033 | 362,638,042 | 365,660,025 | 365,660,025 | ||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
5.00 | % | 183,000,000 | 183,762,500 | 184,528,177 | 185,297,044 | 186,069,116 | 186,844,403 | 187,622,922 | 188,404,684 | 189,189,704 | 189,977,994 | 190,769,569 | 191,564,442 | 192,362,627 | 192,362,627 | ||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
5.00 | % | 16,800,688 | 16,870,691 | 16,940,985 | 17,011,573 | 17,082,454 | 17,153,631 | 17,225,105 | 17,296,876 | 17,368,946 | 17,441,317 | 17,513,989 | 17,586,964 | 17,660,243 | 17,660,243 | ||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
18.00 | % | 322,616,237 | 327,455,481 | 332,367,313 | 337,352,822 | 342,413,115 | 347,549,312 | 352,762,551 | 358,053,989 | 363,424,799 | 368,876,171 | 374,409,314 | 380,025,454 | 385,725,835 | 385,725,835 | ||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
10.00 | % | 345,000,000 | 347,875,000 | 350,773,958 | 353,697,075 | 356,644,550 | 359,616,588 | 362,613,393 | 365,635,171 | 368,682,131 | 371,754,482 | 374,852,436 | 377,976,207 | 381,126,008 | 381,126,008 | ||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
5.00 | % | 83,738,151 | 84,087,060 | 84,437,423 | 84,789,245 | 85,142,534 | 85,497,294 | 85,853,533 | 86,211,256 | 86,570,470 | 86,931,180 | 87,293,393 | 87,657,116 | 88,022,354 | 88,022,354 | ||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.00 | % | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | 86,442,113 | ||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
5.00 | % | 95,872,676 | 96,272,145 | 96,673,279 | 97,076,085 | 97,480,568 | 97,886,737 | 98,294,599 | 98,704,160 | 99,115,427 | 99,528,408 | 99,943,110 | 100,359,539 | 100,777,704 | 100,777,704 | ||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
2,234,608,667 | 2,253,115,604 | 2,271,880,016 | 2,290,904,831 | 2,310,193,023 | 2,329,747,615 | 2,349,571,682 | 2,369,668,347 | 2,390,040,783 | 2,410,692,218 | 2,431,625,929 | 2,452,845,248 | 2,474,353,559 | 2,474,353,559 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Affiliate Management Fees:
|
MGT FEE/DAYS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.45 | % | 13,992 | 14,108 | 14,226 | 14,345 | 14,464 | 14,585 | 14,706 | 14,829 | 14,952 | 15,077 | 15,202 | 15,329 | 175,815 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.65 | % | 31,872 | 32,138 | 32,406 | 32,676 | 32,948 | 33,223 | 33,500 | 33,779 | 34,060 | 34,344 | 34,630 | 34,919 | 400,495 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
- | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.50 | % | 54,065 | 54,425 | 54,788 | 55,153 | 55,521 | 55,891 | 56,264 | 56,639 | 57,016 | 57,397 | 57,779 | 58,164 | 673,103 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.62 | % | 13,429 | 13,485 | 13,541 | 13,598 | 13,654 | 13,711 | 13,769 | 13,826 | 13,883 | 13,941 | 13,999 | 14,058 | 164,896 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.75 | % | 250,784 | 254,755 | 258,788 | 262,886 | 267,048 | 271,276 | 275,572 | 279,935 | 284,367 | 288,870 | 293,443 | 298,089 | 3,285,812 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.66 | % | 183,567 | 185,097 | 186,639 | 188,195 | 189,763 | 191,344 | 192,939 | 194,547 | 196,168 | 197,803 | 199,451 | 201,113 | 2,306,625 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.75 | % | 114,852 | 115,330 | 115,811 | 116,293 | 116,778 | 117,264 | 117,753 | 118,244 | 118,736 | 119,231 | 119,728 | 120,227 | 1,410,246 | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.37 | % | 5,202 | 5,223 | 5,245 | 5,267 | 5,289 | 5,311 | 5,333 | 5,355 | 5,378 | 5,400 | 5,423 | 5,445 | 63,872 | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.75 | % | 204,660 | 207,730 | 210,846 | 214,008 | 217,218 | 220,477 | 223,784 | 227,140 | 230,548 | 234,006 | 237,516 | 241,079 | 2,669,010 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.50 | % | 144,948 | 146,156 | 147,374 | 148,602 | 149,840 | 151,089 | 152,348 | 153,618 | 154,898 | 156,189 | 157,490 | 158,803 | 1,821,353 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.50 | % | 35,036 | 35,182 | 35,329 | 35,476 | 35,624 | 35,772 | 35,921 | 36,071 | 36,221 | 36,372 | 36,524 | 36,676 | 430,205 | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.50 | % | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 36,018 | 432,211 | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.60 | % | 48,136 | 48,337 | 48,538 | 48,740 | 48,943 | 49,147 | 49,352 | 49,558 | 49,764 | 49,972 | 50,180 | 50,389 | 591,056 | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
1,136,560 | 1,147,984 | 1,159,548 | 1,171,256 | 1,183,109 | 1,195,109 | 1,207,257 | 1,219,557 | 1,232,010 | 1,244,618 | 1,257,383 | 1,270,308 | 14,424,699 | |||||||||||||||||||||||||||||||||||||||||||||||
|
Sales Agent Fees:
|
12b1 FEE
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.15 | % | 4,664 | 4,703 | 4,742 | 4,782 | 4,821 | 4,862 | 4,902 | 4,943 | 4,984 | 5,026 | 5,067 | 5,110 | 58,605 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.15 | % | 7,355 | 7,416 | 7,478 | 7,541 | 7,603 | 7,667 | 7,731 | 7,795 | 7,860 | 7,926 | 7,992 | 8,058 | 92,422 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.25 | % | 27,032 | 27,213 | 27,394 | 27,577 | 27,761 | 27,946 | 28,132 | 28,319 | 28,508 | 28,698 | 28,890 | 29,082 | 336,552 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.10 | % | 2,166 | 2,175 | 2,184 | 2,193 | 2,202 | 2,212 | 2,221 | 2,230 | 2,239 | 2,249 | 2,258 | 2,267 | 26,596 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.25 | % | 83,595 | 84,918 | 86,263 | 87,629 | 89,016 | 90,425 | 91,857 | 93,312 | 94,789 | 96,290 | 97,814 | 99,363 | 1,095,271 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.20 | % | 55,626 | 56,090 | 56,557 | 57,029 | 57,504 | 57,983 | 58,466 | 58,954 | 59,445 | 59,940 | 60,440 | 60,943 | 698,977 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.25 | % | 68,220 | 69,243 | 70,282 | 71,336 | 72,406 | 73,492 | 74,595 | 75,713 | 76,849 | 78,002 | 79,172 | 80,360 | 889,670 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.25 | % | 72,474 | 73,078 | 73,687 | 74,301 | 74,920 | 75,544 | 76,174 | 76,809 | 77,449 | 78,094 | 78,745 | 79,401 | 910,676 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.00 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Sales Agent Fees
|
321,132 | 324,836 | 328,587 | 332,386 | 336,234 | 340,131 | 344,077 | 348,075 | 352,124 | 356,224 | 360,378 | 364,585 | 4,108,769 | |||||||||||||||||||||||||||||||||||||||||||||||
Exhibit 4
SCHEDULE OF ASSETS, MGT FEES, and 12b1 FEES-Fiscal 2012
|
assets5/1/11
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
YTD
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Market appreciation
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Percent increase
|
% Change
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Guardian Growth
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Assets By Fund
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
8.842 | % | 40,877,806 | 41,492,908 | 42,117,265 | 42,751,017 | 43,394,305 | 44,047,273 | 44,710,066 | 45,382,833 | 46,065,723 | 46,758,889 | 47,462,484 | 48,176,668 | 48,901,597 | 48,901,597 | ||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
3.999 | % | 64,465,648 | 65,271,481 | 66,087,387 | 66,913,493 | 67,749,924 | 68,596,811 | 69,454,285 | 70,322,477 | 71,201,521 | 72,091,554 | 72,992,713 | 73,905,136 | 74,828,964 | 74,828,964 | ||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.000 | % | 107,486,832 | 107,805,543 | 108,125,199 | 108,445,803 | 108,767,357 | 109,089,865 | 109,413,329 | 109,737,752 | 110,063,137 | 110,389,487 | 110,716,804 | 111,045,092 | 111,374,354 | 111,374,354 | ||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
7.015 | % | 139,594,655 | 141,864,789 | 144,171,840 | 146,516,409 | 148,899,107 | 151,320,552 | 153,781,376 | 156,282,219 | 158,823,731 | 161,406,574 | 164,031,420 | 166,698,953 | 169,409,865 | 169,409,865 | ||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
7.130 | % | 27,208,563 | 27,555,447 | 27,906,753 | 28,262,539 | 28,622,860 | 28,987,776 | 29,357,343 | 29,731,622 | 30,110,673 | 30,494,557 | 30,883,334 | 31,277,068 | 31,675,822 | 31,675,822 | ||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
8.132 | % | 476,943,144 | 488,204,939 | 499,732,652 | 511,532,563 | 523,611,099 | 535,974,838 | 548,630,516 | 561,585,025 | 574,845,422 | 588,418,929 | 602,312,940 | 616,535,023 | 631,092,923 | 631,092,923 | ||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
5.262 | % | 365,660,025 | 371,015,356 | 376,449,119 | 381,962,463 | 387,556,554 | 393,232,574 | 398,991,722 | 404,835,218 | 410,764,295 | 416,780,207 | 422,884,227 | 429,077,643 | 435,361,767 | 435,361,767 | ||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
7.384 | % | 192,362,627 | 194,302,476 | 196,261,886 | 198,241,056 | 200,240,184 | 202,259,472 | 204,299,124 | 206,359,344 | 208,440,339 | 210,542,321 | 212,665,499 | 214,810,088 | 216,976,304 | 216,976,304 | ||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
17.249 | % | 17,660,243 | 17,928,818 | 18,201,478 | 18,478,284 | 18,759,299 | 19,044,589 | 19,334,217 | 19,628,249 | 19,926,754 | 20,229,798 | 20,537,450 | 20,849,781 | 21,166,862 | 21,166,862 | ||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
7.975 | % | 385,725,835 | 392,426,320 | 399,243,200 | 406,178,496 | 413,234,266 | 420,412,603 | 427,715,635 | 435,145,529 | 442,704,489 | 450,394,756 | 458,218,611 | 466,178,376 | 474,276,410 | 474,276,410 | ||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
3.999 | % | 381,126,008 | 386,366,215 | 391,678,472 | 397,063,767 | 402,523,107 | 408,057,509 | 413,668,005 | 419,355,641 | 425,121,478 | 430,966,591 | 436,892,070 | 442,899,020 | 448,988,561 | 448,988,561 | ||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
14.050 | % | 88,022,354 | 89,362,748 | 90,723,554 | 92,105,082 | 93,507,648 | 94,931,572 | 96,377,179 | 97,844,800 | 99,334,769 | 100,847,428 | 102,383,121 | 103,942,200 | 105,525,020 | 105,525,020 | ||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
16.905 | % | 86,442,113 | 87,961,066 | 89,506,710 | 91,079,514 | 92,679,956 | 94,308,520 | 95,965,701 | 97,652,002 | 99,367,934 | 101,114,019 | 102,890,786 | 104,698,773 | 106,538,531 | 106,538,531 | ||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
7.015 | % | 100,777,704 | 101,590,122 | 102,409,090 | 103,234,659 | 104,066,884 | 104,905,818 | 105,751,515 | 106,604,029 | 107,463,416 | 108,329,731 | 109,203,030 | 110,083,368 | 110,970,804 | 110,970,804 | ||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
2,474,353,559 | 2,513,148,229 | 2,552,614,605 | 2,592,765,145 | 2,633,612,550 | 2,675,169,771 | 2,717,450,012 | 2,760,466,739 | 2,804,233,681 | 2,848,764,839 | 2,894,074,489 | 2,940,177,189 | 2,987,087,786 | 2,987,087,786 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Affiliate Management Fees:
|
MGT FEE/DAYS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.450 | % | 15,560 | 15,794 | 16,032 | 16,273 | 16,518 | 16,766 | 17,019 | 17,275 | 17,535 | 17,798 | 18,066 | 18,338 | 202,973 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.650 | % | 35,355 | 35,797 | 36,245 | 36,698 | 37,157 | 37,621 | 38,091 | 38,567 | 39,050 | 39,538 | 40,032 | 40,532 | 454,684 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.400 | % | 35,935 | 36,042 | 36,149 | 36,256 | 36,363 | 36,471 | 36,579 | 36,688 | 36,796 | 36,906 | 37,015 | 37,125 | 438,325 | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.500 | % | 59,110 | 60,072 | 61,049 | 62,041 | 63,050 | 64,076 | 65,118 | 66,177 | 67,253 | 68,346 | 69,458 | 70,587 | 776,336 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.620 | % | 14,237 | 14,418 | 14,602 | 14,788 | 14,977 | 15,168 | 15,361 | 15,557 | 15,756 | 15,956 | 16,160 | 16,366 | 183,347 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.750 | % | 305,128 | 312,333 | 319,708 | 327,257 | 334,984 | 342,894 | 350,991 | 359,278 | 367,762 | 376,446 | 385,334 | 394,433 | 4,176,548 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.660 | % | 204,058 | 207,047 | 210,079 | 213,156 | 216,278 | 219,445 | 222,659 | 225,920 | 229,229 | 232,586 | 235,993 | 239,449 | 2,655,901 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.750 | % | 121,439 | 122,664 | 123,901 | 125,150 | 126,412 | 127,687 | 128,975 | 130,275 | 131,589 | 132,916 | 134,256 | 135,610 | 1,540,874 | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.370 | % | 5,528 | 5,612 | 5,697 | 5,784 | 5,872 | 5,961 | 6,052 | 6,144 | 6,238 | 6,332 | 6,429 | 6,526 | 72,176 | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.750 | % | 245,266 | 249,527 | 253,862 | 258,271 | 262,758 | 267,322 | 271,966 | 276,690 | 281,497 | 286,387 | 291,361 | 296,423 | 3,241,330 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.500 | % | 160,986 | 163,199 | 165,443 | 167,718 | 170,024 | 172,362 | 174,732 | 177,134 | 179,569 | 182,038 | 184,541 | 187,079 | 2,084,825 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.500 | % | 37,234 | 37,801 | 38,377 | 38,962 | 39,555 | 40,157 | 40,769 | 41,389 | 42,020 | 42,660 | 43,309 | 43,969 | 486,202 | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.500 | % | 36,650 | 37,294 | 37,950 | 38,617 | 39,295 | 39,986 | 40,688 | 41,403 | 42,131 | 42,871 | 43,624 | 44,391 | 484,901 | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.600 | % | 50,795 | 51,205 | 51,617 | 52,033 | 52,453 | 52,876 | 53,302 | 53,732 | 54,165 | 54,602 | 55,042 | 55,485 | 637,306 | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
1,327,284 | 1,348,806 | 1,370,710 | 1,393,005 | 1,415,696 | 1,438,792 | 1,462,301 | 1,486,230 | 1,510,588 | 1,535,382 | 1,560,621 | 1,586,314 | 17,435,729 | |||||||||||||||||||||||||||||||||||||||||||||||
|
Sales Agent Fees:
|
12b1 FEE
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.150 | % | 5,187 | 5,265 | 5,344 | 5,424 | 5,506 | 5,589 | 5,673 | 5,758 | 5,845 | 5,933 | 6,022 | 6,113 | 67,658 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.150 | % | 8,159 | 8,261 | 8,364 | 8,469 | 8,575 | 8,682 | 8,790 | 8,900 | 9,011 | 9,124 | 9,238 | 9,354 | 104,927 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.250 | % | 29,555 | 30,036 | 30,524 | 31,021 | 31,525 | 32,038 | 32,559 | 33,088 | 33,626 | 34,173 | 34,729 | 35,294 | 388,168 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.100 | % | 2,296 | 2,326 | 2,355 | 2,385 | 2,416 | 2,446 | 2,478 | 2,509 | 2,541 | 2,574 | 2,606 | 2,640 | 29,572 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.250 | % | 101,709 | 104,111 | 106,569 | 109,086 | 111,661 | 114,298 | 116,997 | 119,759 | 122,587 | 125,482 | 128,445 | 131,478 | 1,392,183 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.200 | % | 61,836 | 62,742 | 63,660 | 64,593 | 65,539 | 66,499 | 67,473 | 68,461 | 69,463 | 70,481 | 71,513 | 72,560 | 804,819 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.250 | % | 81,755 | 83,176 | 84,621 | 86,090 | 87,586 | 89,107 | 90,655 | 92,230 | 93,832 | 95,462 | 97,120 | 98,808 | 1,080,443 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.250 | % | 80,493 | 81,600 | 82,722 | 83,859 | 85,012 | 86,181 | 87,366 | 88,567 | 89,785 | 91,019 | 92,271 | 93,539 | 1,042,413 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Sales Agent Fees
|
370,991 | 377,515 | 384,159 | 390,927 | 397,819 | 404,840 | 411,990 | 419,273 | 426,691 | 434,248 | 441,944 | 449,785 | 4,910,182 | |||||||||||||||||||||||||||||||||||||||||||||||
Notes: Aggressive income trust will merge into the Convertible Fund with the Convertible Fund surviving.
Exhibit 4
SCHEDULE OF ASSETS, MGT FEES, and 12b1 FEES-Fiscal 2013
|
assets5/1/12
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
YTD
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Market appreciation
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
% Change
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Percent increase
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Guardian Growth
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Assets By Fund
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
3.370 | % | 48,901,597 | 49,569,226 | 50,245,969 | 50,931,951 | 51,627,299 | 52,332,140 | 53,046,604 | 53,770,822 | 54,504,927 | 55,249,055 | 56,003,342 | 56,767,927 | 57,542,950 | 57,542,950 | ||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
2.855 | % | 74,828,964 | 75,975,827 | 77,140,267 | 78,322,554 | 79,522,962 | 80,741,767 | 81,979,252 | 83,235,704 | 84,511,412 | 85,806,673 | 87,121,785 | 88,457,054 | 89,812,787 | 89,812,787 | ||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
3.621 | % | 111,374,354 | 112,178,055 | 112,987,556 | 113,802,899 | 114,624,126 | 115,451,279 | 116,284,400 | 117,123,534 | 117,968,723 | 118,820,011 | 119,677,442 | 120,541,060 | 121,410,911 | 121,410,911 | ||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
5.243 | % | 169,409,865 | 171,561,799 | 173,741,068 | 175,948,019 | 178,183,004 | 180,446,379 | 182,738,504 | 185,059,745 | 187,410,472 | 189,791,059 | 192,201,886 | 194,643,336 | 197,115,799 | 197,115,799 | ||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
2.718 | % | 31,675,822 | 32,054,721 | 32,438,152 | 32,826,169 | 33,218,827 | 33,616,183 | 34,018,292 | 34,425,210 | 34,836,996 | 35,253,708 | 35,675,404 | 36,102,144 | 36,533,990 | 36,533,990 | ||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
8.132 | % | 631,092,923 | 649,177,074 | 667,779,431 | 686,914,844 | 706,598,588 | 726,846,376 | 747,674,369 | 769,099,195 | 791,137,956 | 813,808,243 | 837,128,154 | 861,116,304 | 885,791,841 | 885,791,841 | ||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
3.746 | % | 435,361,767 | 442,955,397 | 450,681,477 | 458,542,316 | 466,540,265 | 474,677,715 | 482,957,099 | 491,380,893 | 499,951,616 | 508,671,831 | 517,544,144 | 526,571,210 | 535,755,726 | 535,755,726 | ||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
5.519 | % | 216,976,304 | 219,186,241 | 221,418,687 | 223,673,871 | 225,952,024 | 228,253,380 | 230,578,176 | 232,926,650 | 235,299,044 | 237,695,602 | 240,116,568 | 242,562,192 | 245,032,726 | 245,032,726 | ||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
8.556 | % | 21,166,862 | 21,335,415 | 21,505,309 | 21,676,556 | 21,849,167 | 22,023,153 | 22,198,524 | 22,375,291 | 22,553,466 | 22,733,060 | 22,914,084 | 23,096,549 | 23,280,467 | 23,280,467 | ||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
5.961 | % | 474,276,410 | 483,659,682 | 493,228,596 | 502,986,825 | 512,938,115 | 523,086,285 | 533,435,231 | 543,988,924 | 554,751,416 | 565,726,837 | 576,919,400 | 588,333,401 | 599,973,221 | 599,973,221 | ||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
2.855 | % | 448,988,561 | 453,798,414 | 458,659,792 | 463,573,249 | 468,539,341 | 473,558,634 | 478,631,697 | 483,759,105 | 488,941,442 | 494,179,295 | 499,473,259 | 504,823,936 | 510,231,932 | 510,231,932 | ||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
6.969 | % | 105,525,020 | 106,655,187 | 107,797,457 | 108,951,962 | 110,118,831 | 111,298,197 | 112,490,194 | 113,694,957 | 114,912,624 | 116,143,331 | 117,387,219 | 118,644,429 | 119,915,104 | 119,915,104 | ||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
6.436 | % | 106,538,531 | 107,623,207 | 108,718,927 | 109,825,802 | 110,943,946 | 112,073,475 | 113,214,503 | 114,367,147 | 115,531,528 | 116,707,762 | 117,895,972 | 119,096,280 | 120,308,807 | 120,308,807 | ||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
5.243 | % | 110,970,804 | 111,788,587 | 112,612,396 | 113,442,276 | 114,278,271 | 115,120,428 | 115,968,790 | 116,823,404 | 117,684,317 | 118,551,574 | 119,425,221 | 120,305,307 | 121,191,879 | 121,191,879 | ||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
2,987,087,786 | 3,037,518,831 | 3,088,955,085 | 3,141,419,294 | 3,194,934,767 | 3,249,525,389 | 3,305,215,635 | 3,362,030,583 | 3,419,995,938 | 3,479,138,039 | 3,539,483,881 | 3,601,061,130 | 3,663,898,141 | 3,663,898,141 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Affiliate Management Fees:
|
MGT FEE/DAYS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.450 | % | 18,588 | 18,842 | 19,099 | 19,360 | 19,625 | 19,892 | 20,164 | 20,439 | 20,718 | 21,001 | 21,288 | 21,579 | 240,597 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.650 | % | 41,154 | 41,784 | 42,425 | 43,075 | 43,735 | 44,405 | 45,086 | 45,777 | 46,479 | 47,191 | 47,914 | 48,649 | 537,674 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.400 | % | 37,393 | 37,663 | 37,934 | 38,208 | 38,484 | 38,761 | 39,041 | 39,323 | 39,607 | 39,892 | 40,180 | 40,470 | 466,957 | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.500 | % | 71,484 | 72,392 | 73,312 | 74,243 | 75,186 | 76,141 | 77,108 | 78,088 | 79,080 | 80,084 | 81,101 | 82,132 | 920,350 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.620 | % | 16,562 | 16,760 | 16,960 | 17,163 | 17,368 | 17,576 | 17,786 | 17,999 | 18,214 | 18,432 | 18,653 | 18,876 | 212,350 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.750 | % | 405,736 | 417,362 | 429,322 | 441,624 | 454,279 | 467,296 | 480,687 | 494,461 | 508,630 | 523,205 | 538,198 | 553,620 | 5,714,420 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.660 | % | 243,625 | 247,875 | 252,198 | 256,597 | 261,073 | 265,626 | 270,259 | 274,973 | 279,770 | 284,649 | 289,614 | 294,666 | 3,220,926 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.750 | % | 136,991 | 138,387 | 139,796 | 141,220 | 142,658 | 144,111 | 145,579 | 147,062 | 148,560 | 150,073 | 151,601 | 153,145 | 1,739,184 | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.370 | % | 6,578 | 6,631 | 6,684 | 6,737 | 6,790 | 6,845 | 6,899 | 6,954 | 7,009 | 7,065 | 7,121 | 7,178 | 82,492 | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.750 | % | 302,287 | 308,268 | 314,367 | 320,586 | 326,929 | 333,397 | 339,993 | 346,720 | 353,579 | 360,575 | 367,708 | 374,983 | 4,049,392 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.500 | % | 189,083 | 191,108 | 193,156 | 195,225 | 197,316 | 199,430 | 201,566 | 203,726 | 205,908 | 208,114 | 210,343 | 212,597 | 2,407,571 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.500 | % | 44,440 | 44,916 | 45,397 | 45,883 | 46,374 | 46,871 | 47,373 | 47,880 | 48,393 | 48,911 | 49,435 | 49,965 | 565,837 | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.500 | % | 44,843 | 45,300 | 45,761 | 46,227 | 46,697 | 47,173 | 47,653 | 48,138 | 48,628 | 49,123 | 49,623 | 50,129 | 569,295 | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.600 | % | 55,894 | 56,306 | 56,721 | 57,139 | 57,560 | 57,984 | 58,412 | 58,842 | 59,276 | 59,713 | 60,153 | 60,596 | 698,596 | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
1,614,658 | 1,643,593 | 1,673,131 | 1,703,287 | 1,734,075 | 1,765,510 | 1,797,607 | 1,830,382 | 1,863,851 | 1,898,029 | 1,932,934 | 1,968,583 | 21,425,642 | |||||||||||||||||||||||||||||||||||||||||||||||
|
Sales Agent Fees:
|
12b1 FEE
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.150 | % | 6,196 | 6,281 | 6,366 | 6,453 | 6,542 | 6,631 | 6,721 | 6,813 | 6,906 | 7,000 | 7,096 | 7,193 | 80,199 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.150 | % | 9,497 | 9,643 | 9,790 | 9,940 | 10,093 | 10,247 | 10,404 | 10,564 | 10,726 | 10,890 | 11,057 | 11,227 | 124,079 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.250 | % | 35,742 | 36,196 | 36,656 | 37,121 | 37,593 | 38,071 | 38,554 | 39,044 | 39,540 | 40,042 | 40,551 | 41,066 | 460,175 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.100 | % | 2,671 | 2,703 | 2,736 | 2,768 | 2,801 | 2,835 | 2,869 | 2,903 | 2,938 | 2,973 | 3,009 | 3,044 | 34,250 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.250 | % | 135,245 | 139,121 | 143,107 | 147,208 | 151,426 | 155,765 | 160,229 | 164,820 | 169,543 | 174,402 | 179,399 | 184,540 | 1,904,807 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.200 | % | 73,826 | 75,114 | 76,424 | 77,757 | 79,113 | 80,493 | 81,897 | 83,325 | 84,779 | 86,257 | 87,762 | 89,293 | 976,038 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.250 | % | 100,762 | 102,756 | 104,789 | 106,862 | 108,976 | 111,132 | 113,331 | 115,573 | 117,860 | 120,192 | 122,569 | 124,994 | 1,349,797 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.250 | % | 94,541 | 95,554 | 96,578 | 97,612 | 98,658 | 99,715 | 100,783 | 101,863 | 102,954 | 104,057 | 105,172 | 106,298 | 1,203,785 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Sales Agent Fees
|
458,481 | 467,367 | 476,446 | 485,723 | 495,202 | 504,889 | 514,789 | 524,906 | 535,245 | 545,813 | 556,615 | 567,655 | 6,133,131 | |||||||||||||||||||||||||||||||||||||||||||||||
Exhibit 4
SCHEDULE OF ASSETS, MGT FEES, and 12b1 FEES-Fiscal 2014
|
assets5/1/13
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
YTD
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Market appreciation
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
% Change
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Percent increase
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Guardian Growth
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Assets By Fund
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
8.772 | % | 57,542,950 | 58,688,913 | 59,857,698 | 61,049,759 | 62,265,560 | 63,505,573 | 64,770,282 | 66,060,177 | 67,375,759 | 68,717,542 | 70,086,046 | 71,481,804 | 72,905,358 | 72,905,358 | ||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
4.388 | % | 89,812,787 | 91,465,620 | 93,148,871 | 94,863,099 | 96,608,873 | 98,386,776 | 100,197,397 | 102,041,339 | 103,919,216 | 105,831,651 | 107,779,281 | 109,762,754 | 111,782,728 | 111,782,728 | ||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
4.562 | % | 121,410,911 | 122,493,228 | 123,585,194 | 124,686,895 | 125,798,416 | 126,919,846 | 128,051,273 | 129,192,786 | 130,344,475 | 131,506,431 | 132,678,745 | 133,861,509 | 135,054,818 | 135,054,818 | ||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
5.243 | % | 197,115,799 | 199,948,195 | 202,821,289 | 205,735,668 | 208,691,925 | 211,690,660 | 214,732,485 | 217,818,018 | 220,947,888 | 224,122,731 | 227,343,195 | 230,609,934 | 233,923,613 | 233,923,613 | ||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
7.074 | % | 36,533,990 | 37,166,462 | 37,809,885 | 38,464,446 | 39,130,338 | 39,807,759 | 40,496,907 | 41,197,986 | 41,911,201 | 42,636,764 | 43,374,887 | 44,125,789 | 44,889,691 | 44,889,691 | ||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
8.132 | % | 885,791,841 | 911,542,842 | 938,042,454 | 965,312,441 | 993,375,198 | 1,022,253,772 | 1,051,971,879 | 1,082,553,927 | 1,114,025,031 | 1,146,411,036 | 1,179,738,540 | 1,214,034,913 | 1,249,328,322 | 1,249,328,322 | ||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
5.773 | % | 535,755,726 | 546,926,555 | 558,330,302 | 569,971,825 | 581,856,080 | 593,988,129 | 606,373,138 | 619,016,383 | 631,923,246 | 645,099,226 | 658,549,932 | 672,281,094 | 686,298,559 | 686,298,559 | ||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
5.519 | % | 245,032,726 | 247,812,918 | 250,624,654 | 253,468,293 | 256,344,196 | 259,252,730 | 262,194,265 | 265,169,175 | 268,177,839 | 271,220,640 | 274,297,965 | 277,410,206 | 280,557,760 | 280,557,760 | ||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
17.983 | % | 23,280,467 | 23,648,751 | 24,022,860 | 24,402,888 | 24,788,927 | 25,181,073 | 25,579,423 | 25,984,074 | 26,395,127 | 26,812,683 | 27,236,844 | 27,667,714 | 28,105,401 | 28,105,401 | ||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
5.961 | % | 599,973,221 | 612,802,198 | 625,905,492 | 639,288,968 | 652,958,617 | 666,920,558 | 681,181,042 | 695,746,452 | 710,623,308 | 725,818,270 | 741,338,139 | 757,189,863 | 773,380,537 | 773,380,537 | ||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
4.388 | % | 510,231,932 | 517,199,805 | 524,262,834 | 531,422,317 | 538,679,572 | 546,035,934 | 553,492,757 | 561,051,412 | 568,713,290 | 576,479,802 | 584,352,375 | 592,332,458 | 600,421,519 | 600,421,519 | ||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
14.648 | % | 119,915,104 | 122,088,406 | 124,301,097 | 126,553,890 | 128,847,511 | 131,182,701 | 133,560,214 | 135,980,816 | 138,445,288 | 140,954,425 | 143,509,037 | 146,109,948 | 148,757,997 | 148,757,997 | ||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
13.890 | % | 120,308,807 | 122,402,066 | 124,531,746 | 126,698,481 | 128,902,914 | 131,145,703 | 133,427,514 | 135,749,026 | 138,110,930 | 140,513,930 | 142,958,739 | 145,446,086 | 147,976,710 | 147,976,710 | ||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
4.949 | % | 121,191,879 | 122,129,917 | 123,075,215 | 124,027,830 | 124,987,818 | 125,955,237 | 126,930,143 | 127,912,596 | 128,902,652 | 129,900,372 | 130,905,815 | 131,919,039 | 132,940,106 | 132,940,106 | ||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
3,663,898,141 | 3,736,315,877 | 3,810,319,592 | 3,885,946,797 | 3,963,235,945 | 4,042,226,451 | 4,122,958,718 | 4,205,474,166 | 4,289,815,251 | 4,376,025,501 | 4,464,149,539 | 4,554,233,111 | 4,646,323,119 | 4,646,323,119 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Affiliate Management Fees:
|
MGT FEE/DAYS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.450 | % | 22,008 | 22,447 | 22,894 | 23,350 | 23,815 | 24,289 | 24,773 | 25,266 | 25,769 | 26,282 | 26,806 | 27,340 | 295,037 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.650 | % | 49,544 | 50,456 | 51,384 | 52,330 | 53,293 | 54,274 | 55,272 | 56,290 | 57,325 | 58,380 | 59,455 | 60,549 | 658,552 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.400 | % | 40,831 | 41,195 | 41,562 | 41,933 | 42,307 | 42,684 | 43,064 | 43,448 | 43,835 | 44,226 | 44,621 | 45,018 | 514,725 | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.500 | % | 83,312 | 84,509 | 85,723 | 86,955 | 88,204 | 89,472 | 90,758 | 92,062 | 93,384 | 94,726 | 96,087 | 97,468 | 1,082,661 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.620 | % | 19,203 | 19,535 | 19,873 | 20,217 | 20,567 | 20,923 | 21,286 | 21,654 | 22,029 | 22,410 | 22,798 | 23,193 | 253,690 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.750 | % | 569,714 | 586,277 | 603,320 | 620,859 | 638,909 | 657,482 | 676,596 | 696,266 | 716,507 | 737,337 | 758,772 | 780,830 | 8,042,869 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.660 | % | 300,810 | 307,082 | 313,485 | 320,021 | 326,693 | 333,505 | 340,459 | 347,558 | 354,805 | 362,202 | 369,755 | 377,464 | 4,053,838 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.750 | % | 154,883 | 156,640 | 158,418 | 160,215 | 162,033 | 163,871 | 165,731 | 167,611 | 169,513 | 171,436 | 173,381 | 175,349 | 1,979,082 | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.370 | % | 7,292 | 7,407 | 7,524 | 7,643 | 7,764 | 7,887 | 8,012 | 8,138 | 8,267 | 8,398 | 8,531 | 8,666 | 95,530 | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.750 | % | 383,001 | 391,191 | 399,556 | 408,099 | 416,825 | 425,738 | 434,842 | 444,140 | 453,636 | 463,336 | 473,244 | 483,363 | 5,176,971 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.500 | % | 215,500 | 218,443 | 221,426 | 224,450 | 227,515 | 230,622 | 233,771 | 236,964 | 240,200 | 243,480 | 246,805 | 250,176 | 2,789,352 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.500 | % | 50,870 | 51,792 | 52,731 | 53,686 | 54,659 | 55,650 | 56,659 | 57,686 | 58,731 | 59,795 | 60,879 | 61,982 | 675,121 | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.500 | % | 51,001 | 51,888 | 52,791 | 53,710 | 54,644 | 55,595 | 56,562 | 57,546 | 58,547 | 59,566 | 60,603 | 61,657 | 674,110 | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.600 | % | 61,065 | 61,538 | 62,014 | 62,494 | 62,978 | 63,465 | 63,956 | 64,451 | 64,950 | 65,453 | 65,960 | 66,470 | 764,793 | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
2,009,034 | 2,050,399 | 2,092,701 | 2,135,962 | 2,180,206 | 2,225,458 | 2,271,740 | 2,319,079 | 2,367,500 | 2,417,030 | 2,467,696 | 2,519,525 | 27,056,329 | |||||||||||||||||||||||||||||||||||||||||||||||
|
Sales Agent Fees:
|
12b1 FEE
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.150 | % | 7,336 | 7,482 | 7,631 | 7,783 | 7,938 | 8,096 | 8,258 | 8,422 | 8,590 | 8,761 | 8,935 | 9,113 | 98,346 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.150 | % | 11,433 | 11,644 | 11,858 | 12,076 | 12,298 | 12,525 | 12,755 | 12,990 | 13,229 | 13,472 | 13,720 | 13,973 | 151,973 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.250 | % | 41,656 | 42,254 | 42,862 | 43,477 | 44,102 | 44,736 | 45,379 | 46,031 | 46,692 | 47,363 | 48,044 | 48,734 | 541,330 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.100 | % | 3,097 | 3,151 | 3,205 | 3,261 | 3,317 | 3,375 | 3,433 | 3,493 | 3,553 | 3,615 | 3,677 | 3,741 | 40,918 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.250 | % | 189,905 | 195,426 | 201,107 | 206,953 | 212,970 | 219,161 | 225,532 | 232,089 | 238,836 | 245,779 | 252,924 | 260,277 | 2,680,956 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.200 | % | 91,154 | 93,055 | 94,995 | 96,976 | 98,998 | 101,062 | 103,169 | 105,321 | 107,517 | 109,758 | 112,047 | 114,383 | 1,228,436 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.250 | % | 127,667 | 130,397 | 133,185 | 136,033 | 138,942 | 141,913 | 144,947 | 148,047 | 151,212 | 154,445 | 157,748 | 161,121 | 1,725,657 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.250 | % | 107,750 | 109,221 | 110,713 | 112,225 | 113,757 | 115,311 | 116,886 | 118,482 | 120,100 | 121,740 | 123,403 | 125,088 | 1,394,676 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Sales Agent Fees
|
579,999 | 592,630 | 605,556 | 618,785 | 632,323 | 646,178 | 660,359 | 674,873 | 689,728 | 704,934 | 720,498 | 736,429 | 7,862,292 | |||||||||||||||||||||||||||||||||||||||||||||||
Exhibit 4
SCHEDULE OF ASSETS, MGT FEES, and 12b1 FEES-Fiscal 2015
|
assets5/1/14
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
YTD
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Market appreciation
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
% Change
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Percent increase
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Guardian Growth
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Assets By Fund
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.356 | % | 72,905,358 | 74,049,262 | 75,211,113 | 76,391,194 | 77,589,791 | 78,807,194 | 80,043,698 | 81,299,604 | 82,575,215 | 83,870,841 | 85,186,795 | 86,523,397 | 87,880,971 | 87,880,971 | ||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
2.860 | % | 111,782,728 | 114,033,113 | 116,328,801 | 118,670,705 | 121,059,757 | 123,496,904 | 125,983,115 | 128,519,378 | 131,106,701 | 133,746,110 | 136,438,656 | 139,185,408 | 141,987,456 | 141,987,456 | ||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
4.600 | % | 135,054,818 | 136,509,166 | 137,979,176 | 139,465,016 | 140,966,856 | 142,484,869 | 144,019,229 | 145,570,111 | 147,137,695 | 148,722,159 | 150,323,685 | 151,942,458 | 153,578,662 | 153,578,662 | ||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
4.949 | % | 233,923,613 | 237,812,417 | 241,765,869 | 245,785,044 | 249,871,034 | 254,024,952 | 258,247,925 | 262,541,102 | 266,905,649 | 271,342,754 | 275,853,623 | 280,439,481 | 285,101,576 | 285,101,576 | ||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.287 | % | 44,889,691 | 45,538,185 | 46,196,047 | 46,863,413 | 47,540,421 | 48,227,208 | 48,923,917 | 49,630,691 | 50,347,676 | 51,075,018 | 51,812,868 | 52,561,377 | 53,320,699 | 53,320,699 | ||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
8.132 | % | 1,249,328,322 | 1,288,166,398 | 1,328,211,841 | 1,369,502,182 | 1,412,076,123 | 1,455,973,568 | 1,501,235,659 | 1,547,904,821 | 1,596,024,795 | 1,645,640,682 | 1,696,798,986 | 1,749,547,658 | 1,803,936,136 | 1,803,936,136 | ||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
3.763 | % | 686,298,559 | 701,451,770 | 716,939,558 | 732,769,311 | 748,948,579 | 765,485,078 | 782,386,698 | 799,661,499 | 817,317,720 | 835,363,785 | 853,808,300 | 872,660,062 | 891,928,064 | 891,928,064 | ||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
5.210 | % | 280,557,760 | 284,282,418 | 288,056,525 | 291,880,736 | 295,755,718 | 299,682,143 | 303,660,695 | 307,692,066 | 311,776,957 | 315,916,079 | 320,110,151 | 324,359,904 | 328,666,076 | 328,666,076 | ||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.582 | % | 28,105,401 | 28,154,165 | 28,203,014 | 28,251,947 | 28,300,966 | 28,350,069 | 28,399,258 | 28,448,532 | 28,497,891 | 28,547,336 | 28,596,867 | 28,646,483 | 28,696,186 | 28,696,186 | ||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
5.626 | % | 773,380,537 | 791,926,766 | 810,917,747 | 830,364,145 | 850,276,882 | 870,667,141 | 891,546,373 | 912,926,305 | 934,818,942 | 957,236,582 | 980,191,812 | 1,003,697,526 | 1,027,766,924 | 1,027,766,924 | ||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
2.860 | % | 600,421,519 | 609,357,703 | 618,426,886 | 627,631,047 | 636,972,196 | 646,452,371 | 656,073,641 | 665,838,106 | 675,747,897 | 685,805,177 | 696,012,142 | 706,371,019 | 716,884,070 | 716,884,070 | ||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.474 | % | 148,757,997 | 149,968,694 | 151,189,245 | 152,419,729 | 153,660,227 | 154,910,822 | 156,171,595 | 157,442,629 | 158,724,008 | 160,015,815 | 161,318,136 | 162,631,056 | 163,954,661 | 163,954,661 | ||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.461 | % | 147,976,710 | 149,165,143 | 150,363,121 | 151,570,720 | 152,788,017 | 154,015,091 | 155,252,020 | 156,498,883 | 157,755,760 | 159,022,731 | 160,299,877 | 161,587,280 | 162,885,023 | 162,885,023 | ||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
5.620 | % | 132,940,106 | 134,228,526 | 135,529,433 | 136,842,948 | 138,169,193 | 139,508,292 | 140,860,369 | 142,225,550 | 143,603,962 | 144,995,733 | 146,400,992 | 147,819,872 | 149,252,502 | 149,252,502 | ||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
4,646,323,119 | 4,744,643,726 | 4,845,318,375 | 4,948,408,139 | 5,053,975,761 | 5,162,085,702 | 5,272,804,192 | 5,386,199,276 | 5,502,340,867 | 5,621,300,801 | 5,743,152,891 | 5,867,972,981 | 5,995,839,006 | 5,995,839,006 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Affiliate Management Fees:
|
MGT FEE/DAYS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.450 | % | 27,768 | 28,204 | 28,647 | 29,096 | 29,553 | 30,016 | 30,487 | 30,966 | 31,452 | 31,945 | 32,446 | 32,955 | 363,536 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.650 | % | 61,768 | 63,011 | 64,280 | 65,574 | 66,894 | 68,241 | 69,615 | 71,016 | 72,446 | 73,904 | 75,392 | 76,910 | 829,051 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.400 | % | 45,503 | 45,993 | 46,488 | 46,989 | 47,495 | 48,006 | 48,523 | 49,046 | 49,574 | 50,108 | 50,647 | 51,193 | 579,566 | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.500 | % | 99,089 | 100,736 | 102,410 | 104,113 | 105,844 | 107,603 | 109,392 | 111,211 | 113,059 | 114,939 | 116,850 | 118,792 | 1,304,038 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.620 | % | 23,528 | 23,868 | 24,213 | 24,563 | 24,917 | 25,277 | 25,643 | 26,013 | 26,389 | 26,770 | 27,157 | 27,549 | 305,886 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.750 | % | 805,104 | 830,132 | 855,939 | 882,548 | 909,983 | 938,272 | 967,441 | 997,515 | 1,028,525 | 1,060,499 | 1,093,467 | 1,127,460 | 11,496,887 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.660 | % | 385,798 | 394,317 | 403,023 | 411,922 | 421,017 | 430,313 | 439,814 | 449,525 | 459,450 | 469,595 | 479,963 | 490,560 | 5,235,296 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.750 | % | 177,677 | 180,035 | 182,425 | 184,847 | 187,301 | 189,788 | 192,308 | 194,861 | 197,448 | 200,069 | 202,725 | 205,416 | 2,294,900 | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.370 | % | 8,681 | 8,696 | 8,711 | 8,726 | 8,741 | 8,756 | 8,772 | 8,787 | 8,802 | 8,817 | 8,833 | 8,848 | 105,170 | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.750 | % | 494,954 | 506,824 | 518,978 | 531,423 | 544,167 | 557,216 | 570,579 | 584,262 | 598,273 | 612,620 | 627,311 | 642,354 | 6,788,961 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.500 | % | 253,899 | 257,678 | 261,513 | 265,405 | 269,355 | 273,364 | 277,433 | 281,562 | 285,752 | 290,005 | 294,321 | 298,702 | 3,308,988 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.500 | % | 62,487 | 62,996 | 63,508 | 64,025 | 64,546 | 65,071 | 65,601 | 66,135 | 66,673 | 67,216 | 67,763 | 68,314 | 784,336 | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.500 | % | 62,152 | 62,651 | 63,154 | 63,662 | 64,173 | 64,688 | 65,208 | 65,732 | 66,259 | 66,792 | 67,328 | 67,869 | 779,668 | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.600 | % | 67,114 | 67,765 | 68,421 | 69,085 | 69,754 | 70,430 | 71,113 | 71,802 | 72,498 | 73,200 | 73,910 | 74,626 | 849,719 | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Affiliate Management Fees
|
2,575,523 | 2,632,906 | 2,691,711 | 2,751,977 | 2,813,741 | 2,877,044 | 2,941,927 | 3,008,431 | 3,076,600 | 3,146,479 | 3,218,113 | 3,291,550 | 35,026,003 | |||||||||||||||||||||||||||||||||||||||||||||||
|
Sales Agent Fees:
|
12b1 FEE
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Aggressive Income
|
0.150 | % | 9,256 | 9,401 | 9,549 | 9,699 | 9,851 | 10,005 | 10,162 | 10,322 | 10,484 | 10,648 | 10,815 | 10,985 | 121,179 | |||||||||||||||||||||||||||||||||||||||||||||
|
Asset Allocation Fund
|
0.150 | % | 14,254 | 14,541 | 14,834 | 15,132 | 15,437 | 15,748 | 16,065 | 16,388 | 16,718 | 17,055 | 17,398 | 17,748 | 191,320 | |||||||||||||||||||||||||||||||||||||||||||||
|
U.S. Govt Money Mkt
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Centurion Fund
|
0.250 | % | 49,544 | 50,368 | 51,205 | 52,056 | 52,922 | 53,802 | 54,696 | 55,605 | 56,530 | 57,470 | 58,425 | 59,396 | 652,019 | |||||||||||||||||||||||||||||||||||||||||||||
|
Convertible Fund
|
0.100 | % | 3,795 | 3,850 | 3,905 | 3,962 | 4,019 | 4,077 | 4,136 | 4,196 | 4,256 | 4,318 | 4,380 | 4,443 | 49,336 | |||||||||||||||||||||||||||||||||||||||||||||
|
Emerging Opportunities
|
0.250 | % | 268,368 | 276,711 | 285,313 | 294,183 | 303,328 | 312,757 | 322,480 | 332,505 | 342,842 | 353,500 | 364,489 | 375,820 | 3,832,296 | |||||||||||||||||||||||||||||||||||||||||||||
|
Income and Growth
|
0.200 | % | 116,909 | 119,490 | 122,128 | 124,825 | 127,581 | 130,398 | 133,277 | 136,220 | 139,227 | 142,301 | 145,443 | 148,655 | 1,586,453 | |||||||||||||||||||||||||||||||||||||||||||||
|
Larger Co
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
NY Tax Exempt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Premier Growth Fund
|
0.250 | % | 164,985 | 168,941 | 172,993 | 177,141 | 181,389 | 185,739 | 190,193 | 194,754 | 199,424 | 204,207 | 209,104 | 214,118 | 2,262,987 | |||||||||||||||||||||||||||||||||||||||||||||
|
SAM
|
0.250 | % | 126,950 | 128,839 | 130,756 | 132,703 | 134,678 | 136,682 | 138,716 | 140,781 | 142,876 | 145,003 | 147,161 | 149,351 | 1,654,494 | |||||||||||||||||||||||||||||||||||||||||||||
|
Tax Exempt High Yield Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
US Govt Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
VL Fund
|
0.000 | % | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Sales Agent Fees
|
754,060 | 772,141 | 790,683 | 809,700 | 829,204 | 849,208 | 869,726 | 890,771 | 912,358 | 934,501 | 957,215 | 980,517 | 10,350,084 | |||||||||||||||||||||||||||||||||||||||||||||||