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As filed with the Securities and Exchange Commission on June 24, 2020
Securities Act File No. 333-______
1940 Act Registration No. 811-4603
U.S. SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C. 20549
FORM N-14
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
☐ Pre-Effective Amendment No._____
☐ Post-Effective Amendment No.____
(Check appropriate box or boxes)
THRIVENT SERIES FUND, INC.
(Exact Name of Registrant as Specified in Charter)
901 MARQUETTE AVENUE, SUITE 2500
MINNEAPOLIS, MINNESOTA 55402-3265
(Address of Principal Executive Offices)
612-844-7190
(Area Code and Telephone Number)
JOHN D. JACKSON
ASSISTANT SECRETARY
THRIVENT SERIES FUND, INC.
901 MARQUETTE AVENUE, SUITE 2500
MINNEAPOLIS, MINNESOTA 55402-3265
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable after this registration statement becomes effective. It is proposed that this filing will become effective on July 24, 2020 pursuant to Rule 488 under the Securities Act of 1933.
Title of Securities Being Registered: Shares of beneficial interest, par value $.01 per share. The Registrant has registered an indefinite number of shares of beneficial interest pursuant to Section 24(f) of the Investment Company Act of 1940, as amended, and is in a continuous offering of such shares under an effective registration statement (File Nos. 33-3677 and 811-4603). No filing fee is due herewith because of reliance on Section 24(f) of the Investment Company Act of 1940, as amended.
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LETTER FOR CONTRACTHOLDERS
Dear Contractholder:
The Board of Directors of Thrivent Series Fund, Inc. (the “Fund”) has scheduled a special meeting of contractholders for August 24, 2020 (the “Meeting”). At the Meeting, the contractholders of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”) will be asked to consider and approve an Agreement and Plan of Reorganization (an “Agreement”) providing for its reorganization into Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”).
As further described in the Prospectus/Proxy Statement, Thrivent Financial for Lutherans is the direct shareholder of the Target Portfolio and sponsor of the variable life insurance contracts and variable annuity contracts (each, a “Variable Contract”). As the holder of a Variable Contract, you are being solicited for voting instructions so that shares of the Target Portfolio may be voted in proportion to the instructions received.
Due to COVID-19 health and safety concerns, the Meeting will be conducted online only on August 24, 2020 at 9:30 a.m. Central Time. You will not be able to attend the meeting in person.
You will be able to attend and participate in the Meeting online by visiting www.proxypush.com/THR, where you will be able to listen to the meeting live, submit questions and vote.
To be admitted to the Meeting and vote your shares, you must register in advance at www.proxypush.com/THR prior to the deadline of Thursday, August 20, 2020 at 4:00 p.m. Central Time and provide the control number as provided in the Notice, or proxy card, or voting instruction form at www.proxypush.com/THR. Upon completing your registration, you will receive further instructions via email, including unique links to access the Meeting and to submit questions in advance of the Meeting.
If you are not planning to attend the Meeting online, please vote before August 24 in one of the ways described below.
If the merger is approved, your investment in the Target Portfolio will automatically be transferred into the Acquiring Portfolio. We will send you a written confirmation after this takes place. This transfer is not expected to be a taxable event. (Of course, you may transfer your investment to a completely different series, which will not count as one of your permitted annual exchanges.)
Your vote counts! You may vote quickly and easily in any one of these ways:
• | Internet: see the instructions on the enclosed proxy card. |
• | Phone: see the instructions on the enclosed proxy card. |
• | Mail: use the enclosed proxy card and postage-paid envelope. |
• | Attend the virtual Meeting: attend the Meeting online on August 24. You can register to attend and vote at the Meeting online by following the instructions on the enclosed proxy card. |
Thank you for taking this matter seriously and participating in this important process.
Sincerely,
David S. Royal
President and Chief Investment Officer
Thrivent Series Fund, Inc.
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Questions & Answers
For Contractholders of Thrivent Partner Growth Stock Portfolio
Although we recommend that you read the complete Prospectus/Proxy Statement, we have provided the following questions and answers to clarify and summarize the issues to be voted on.
Q: Why is a contractholder meeting being held?
A: A special meeting of contractholders (the “Meeting”) of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”) is being held to seek contractholder approval of a reorganization (the “Reorganization”) of the Target Portfolio into Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”). Please refer to the Prospectus/Proxy Statement for a detailed explanation of the proposed Reorganization and for a more complete description of the Acquiring Portfolio.
Q: Why is the Reorganization being recommended?
A: After careful consideration, the Board of Directors (the “Board”) of Thrivent Series Fund, Inc. (the “Fund”) has determined that the Reorganization is in the best interests of the contractholders of the Target Portfolio and recommends that you cast your vote “FOR” the proposed Reorganization. The Target Portfolio and the Acquiring Portfolio both invest primarily in equity securities with growth characteristics and each is a series of the Company, an open-end investment company registered under the Investment Company Act of 1940. Thrivent Financial for Lutherans (“Thrivent Financial”) is the investment adviser for the Target Portfolio and the Acquiring Portfolio.
The Target Portfolio has generally underperformed relative to comparable growth equity funds since its current portfolio management took over in 2014. The Reorganization was approved by the Board on June 24, 2020. The Board considered the fact that as of March 31, 2020, the Target Portfolio was ranked in the bottom quartile of its Lipper peer group for the prior one-year and two-year periods and below median for the three-year and five-year periods. The Acquiring Portfolio has posted much more competitive results, ranking in the top quartile for the one-year and two-year time periods and above median for three-year and five-year periods. The current portfolio manager, Lauri Brunner, began managing the Acquiring Portfolio in September 2018.
The Board believes that the Reorganization would be in the best interests of the contractholders of the Target Portfolio because: (i) contractholders will become contractholders of a much larger combined portfolio with greater potential to increase asset size and achieve economies of scale; (ii) at the time of the Board’s approval on June 24, 2020, the Acquiring Portfolio had achieved better performance than the
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Target Portfolio for the one-, two-, three- and five-year periods ended March 31, 2020, both in terms of Lipper peer group rankings and on an absolute basis, though there is no guarantee of future performance; (iii) Thrivent Financial believes that it can most effectively manage the assets currently in the Target Portfolio by combining such assets with the Acquiring Portfolio; and (iv) the Acquiring Portfolio has a lower gross expense ratio than the Target Portfolio and shareholders of the Target Portfolio will experience a lower net expense ratio in the Acquiring Portfolio following the Reorganization.
The Acquiring Portfolio anticipates selling approximately 47% of the market value of the Target Portfolio’s investments after the Reorganization. As of May 29, 2020, the Target Portfolio’s investments that the Acquiring Portfolio would anticipate selling have a market value of $130,403,977.46.
Q: Who can vote?
A: Owners of the variable life insurance contracts and variable annuity contracts (each a “Variable Contract” and such owners, “Contractholders”) as of July 10, 2020 funded by the Target Portfolio are entitled to vote at the Meeting. Thrivent Financial for Lutherans (“Thrivent Financial”) is the Target Portfolio’s investment adviser. Thrivent Financial (the “Shareholder”) is the sponsor of your Variable Contract. The Target Portfolio is currently an investment option in the separate accounts held directly by the Shareholder, which are used to fund the variable life insurance policies and variable annuity contracts sponsored by the Shareholder. Accordingly, Contractholders are being solicited to provide voting instructions to the direct Shareholder, which will in turn cast votes in accordance with instructions provided by the Contractholders.
If your voting instructions are not timely received, any shares of the Target Portfolio attributable to a Variable Contract will be voted by Thrivent Financial in proportion to the voting instructions received for all Variable Contracts participating in the proxy solicitation. This voting procedure may result in a relatively small number of Contractholders determining the outcome of the vote. If a proxy card is timely returned with no voting instructions, the shares of the Portfolio will be voted FOR the Reorganization.
Any shares of the Target Portfolio held by Thrivent Financial or its affiliates for their own account will also be voted in proportion to the voting instructions received from all Contractholders participating in the proxy solicitation.
Q: How will the Reorganization affect me?
A: Assuming Contractholders approve the proposed Reorganization, the assets of the Target Portfolio will be combined with those of the Acquiring Portfolio. The shares of the Target Portfolio that fund your benefits under Variable Contracts automatically
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would be exchanged for an equal dollar value of shares of the Acquiring Portfolio. The Reorganization would affect only the investments underlying Variable Contracts and would not otherwise affect Variable Contracts. Following the Reorganization, the Target Portfolio will dissolve.
Q: Will I have to pay any commission or other similar fee as a result of the Reorganization?
A: Contractholders will not pay any commissions or fees in connection with the Reorganization, although certain transaction costs such as trading commissions and custody transaction charges will be borne by the Target Portfolio and/or the Acquiring Portfolio.
Q: Will the total annual operating expenses that my portfolio investment bears increase as a result of the Reorganization?
A: No, they are likely to decrease. An unexpected increase in “Other Expenses” of the Acquiring Portfolio could cause them to increase. For more information about how fund expenses may change as a result of the Reorganization, please see the comparative and pro forma table and related disclosures in the COMPARISON OF THE PORTFOLIOS—Expenses section of the Prospectus/Proxy Statement.
Q: Will I have to pay any U.S. federal income taxes as a result of the Reorganization?
A: The Reorganization is expected to be tax-free for federal income tax purposes. The Target Portfolio will seek an opinion of counsel to this effect. Generally, neither Shareholders nor Contractholders will incur capital gains or losses on the exchange of Target Portfolio shares for Acquiring Portfolio shares as a result of the Reorganization. The cost basis on each investment will also remain the same. If you choose to make a total or partial surrender of your Variable Contract, you may be subject to taxes and other charges under your Variable Contract.
Q: Can I surrender or exchange my interests in the Target Portfolio for a different subaccount option of the Fund or surrender my contract before the Reorganization takes place?
A: Yes, but please refer to the most recent prospectus of your Variable Contract as certain charges and/or restrictions may apply to such exchanges and surrenders.
Q: If Contractholders of the Target Portfolio do not approve the Reorganization, what will happen to the Target Portfolio?
A: Thrivent Financial will reassess what changes it would like to make to a Target Portfolio, including a possible repurposing of the Target Portfolio’s principal investment strategies or recommending to the Board a liquidation of the Target Portfolio. It may ultimately decide to make no changes.
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Q: Who pays the costs of the Reorganization?
A: If the Reorganization is approved, certain transaction costs such as trading commissions and custody transaction charges will be borne by the Target Portfolio and/or the Acquiring Portfolio. Other costs associated with the Reorganization, such as the costs of the Meeting, proxy expenses, legal fees, IT system changes, audit fees and filing fees, will be paid by Thrivent Financial and will not be borne by shareholders of the Target Portfolio, regardless of whether the Reorganization is completed.
Q: How can I vote?
A: Contractholders are invited to attend the online Meeting to cast their vote. Due to COVID-19 safety concerns, the Meeting will be conducted online only and Contractholders will not be able to attend in person.
You will be able to attend and participate in the Meeting online by visiting www.proxypush.com/THR, where you will be able to listen to the meeting live, submit questions and vote.
To be admitted to the Meeting and vote your shares, you must register in advance at www.proxypush.com/THR prior to the deadline of Thursday, August 20, 2020 at 4:00 p.m. Central Time and provide the control number as provided in the Notice, or proxy card, or voting instruction form at www.proxypush.com/THR. Upon completing your registration, you will receive further instructions via email, including unique links to access the Meeting and to submit questions in advance of the Meeting.
You may also vote by executing a proxy using one of three methods:
• | Internet: Instructions for casting your vote via the Internet can be found in the enclosed proxy voting materials. The required control number is printed on your enclosed proxy card. If this feature is used, there is no need to mail the proxy card. |
• | Phone: Instructions for casting your vote via phone can be found in the enclosed proxy voting materials. The toll-free number and required control number are printed on your enclosed proxy card. If this feature is used, there is no need to mail the proxy card. |
• | Mail: If you vote by mail, please indicate your voting instructions on the enclosed proxy card, date and sign the card, and return it in the envelope provided, which is addressed for your convenience and needs no postage if mailed in the United States. |
Contractholders who execute proxies by Internet, phone or mail may revoke them at any time prior to the Meeting by filing with the Target Portfolio a written notice of revocation, by executing another proxy bearing a later date, by voting later by Internet or phone or by attending the online Meeting. Merely attending the online Meeting, however, will not revoke any previously submitted proxy.
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Q: How do I attend the Meeting online?
A: There is no physical location for the Meeting. To attend the Meeting online, please visit www.proxypush.com/THR and follow the instruction as outlined on the website.
The Meeting will be a webcast that you can view on your browser with no plug-ins or downloads required. You can access the Meeting online using your computer, tablet or mobile device.
Access to the Meeting Online. A live audio webcast of the Meeting will begin promptly at 9:30 a.m. Central Time on August 24, 2020. Online access to the audio webcast will open approximately 15 minutes in advance of the meeting start time. You should ensure that you have a strong Wi-Fi connection wherever you intend to participate in the Meeting and give yourself plenty of time to log in and ensure that you can hear audio prior to the start of the Meeting.
Registration. To attend the Meeting online, you must register at www.proxypush.com/THR by 4:00 p.m. Central Time on August 20, 2020. You will receive an email confirming your registration, and you will receive a link with instructions on how to access the Meeting approximately one hour prior to its start time. However, you won’t be able to join the Meeting until 15 minutes before it is scheduled to start.
Q: When should I vote?
A: Every vote is important and the Board encourages you to record your vote as soon as possible. Voting your proxy now will ensure that the necessary number of votes is obtained, without the time and expense required for additional proxy solicitation.
Q: Who should I call if I have questions about the proposal in the Prospectus/Proxy Statement?
A: Call Mediant Communications at 888-441-3205 with your questions.
Q: How can I get more information about the Target and Acquiring Portfolios or my variable contract?
A: You may obtain (1) a prospectus, statement of additional information or annual/semiannual report for the Portfolios, (2) a prospectus or statement of additional information for your Variable Contract or (3) the statement of additional information regarding the Reorganization (request the “Reorganization SAI”) by:
• | Phone—800-847-4836 and say “Variable Annuity” or “Variable Universal Life” |
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• | Mail—Thrivent Series Fund, Inc., 4321 North Ballard Road, Appleton, WI 54919 |
• | Internet: |
— | For a copy of a prospectus, a statement of additional information, and/or annual/semiannual report: |
• | Variable Annuity Reference Center: https://www.thrivent.com/what-we-offer/insurance/annuities/variable-annuity-reference-center.html |
• | Variable Universal Life Reference Center: https://www.thrivent.com/what-we-offer/insurance/variable-universal-life-reference-center.html |
• | AdvisorFlex Variable Annuity Reference Center: https://www.thrivent.com/what-we-offer/insurance/annuities/thrivent-advisorflex-variable-annuity-reference-center.html |
— | For a copy of the Reorganization SAI: www.proxypush.com/THR |
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Thrivent Partner Growth Stock Portfolio
a series of
THRIVENT SERIES FUND, INC.
901 Marquette Ave., Suite 2500
Minneapolis, Minnesota 55402
800-847-4836
Thrivent.com
NOTICE OF SPECIAL MEETING
OF CONTRACTHOLDERS
To be Held on August 24, 2020
NOTICE IS HEREBY GIVEN THAT a special meeting of contractholders (with any adjournments, the “Meeting”) of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”), a series of Thrivent Series Fund, Inc. (the “Fund”), will be held on August 24, 2020 at 9:30 a.m. Central Time. The Meeting will be held online only and Contractholders will not be able to attend the Meeting in person. To participate in the online Meeting, contractholders eligible to vote at the Meeting must register in advance at www.proxypush.com/THR prior to the deadline of Thursday, August 20, 2020 at 4:00 p.m. Central Time and provide the control number as provided in the Notice, or proxy card, or voting instruction form at www.proxypush.com/THR. Upon completing your registration, you will receive further instructions via email, including unique links to access the Meeting and to submit questions in advance of the Meeting.
The Meeting is being held for the following purposes:
1. | To approve an Agreement and Plan of Reorganization pursuant to which the Target Portfolio would (i) transfer all of its assets to Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”), a series of the Fund, in exchange for Shares of the Acquiring Portfolio, (ii) distribute such Shares of the Acquiring Portfolio to contractholders of the Target Portfolio, and (iii) dissolve. |
2. | To transact such other business as may properly be presented at the Meeting or any adjournment thereof. |
The Board of Directors of the Fund (the “Board”) has fixed the close of business on July 10, 2020 as the record date for the determination of contractholders (“Contractholders”) entitled to notice of, and to vote at, the Meeting and all adjournments thereof.
Thrivent Financial for Lutherans is the direct shareholder of the Target Portfolio and sponsor of the variable life insurance contracts and variable annuity contracts (each, a “Variable Contract”). As the holder of a Variable Contract, you are being solicited for voting instructions so that shares of the Target Portfolio may be voted in proportion to the instructions received.
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Contractholders are invited to attend the online Meeting to cast their vote. Due to COVID-19 safety concerns, the Meeting will be conducted online only and Contractholders will not be able to attend in person.
You may also vote by executing a proxy using one of three methods:
• | Internet—Instructions for casting your vote via the Internet can be found in the enclosed proxy voting materials. The required control number is printed on your enclosed proxy card. If this feature is used, there is no need to mail the proxy card. |
• | Phone—Instructions for casting your vote via phone can be found in the enclosed proxy voting materials. The toll-free number and required control number are printed on your enclosed proxy card. If this feature is used, there is no need to mail the proxy card. |
• | Mail—If you vote by mail, please indicate your voting instructions on the enclosed proxy card, date and sign the card, and return it in the envelope provided, which is addressed for your convenience and needs no postage if mailed in the United States. |
Contractholders who execute proxies by Internet, phone, or mail may revoke them at any time prior to the Meeting by filing with the Target Portfolio a written notice of revocation, by executing another proxy bearing a later date, or by attending the online Meeting. Merely attending the online Meeting, however, will not revoke any previously submitted proxy.
The Board recommends that you cast your vote FOR the proposed Reorganization as described in the Prospectus/Proxy Statement.
YOUR VOTE IS IMPORTANT
Please return your proxy card or record your voting instructions promptly no matter how many shares you own. In order to avoid the additional expense of further solicitation, we ask that you mail your proxy card or record your voting instructions by Internet or phone promptly regardless of whether you plan to attend the online Meeting.
Date: [ ], 2020
John D. Jackson
Assistant Secretary
Thrivent Series Fund, Inc.
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COMBINED PROSPECTUS/PROXY STATEMENT
THRIVENT PARTNER GROWTH STOCK PORTFOLIO
a series of
THRIVENT SERIES FUND, INC.
901 Marquette Ave., Suite 2500
Minneapolis, Minnesota 55402
800-847-4836
[ ], 2020
This Prospectus/Proxy Statement is furnished to you as a contractholder of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”), a series of Thrivent Series Fund, Inc. (the “Fund”). A special meeting of shareholders of the Target Portfolio will be held on August 24, 2020 (the “Meeting”) to consider the items that are described below and discussed in greater detail elsewhere in this Prospectus/Proxy Statement. The Board of Directors of the Fund (the “Board”) requests that you vote your shares by completing and returning the enclosed proxy card or by recording your voting instructions by Internet or phone regardless of whether you plan to attend the Meeting online in order to avoid the additional expense of further solicitation.
The Acquiring Portfolio and the Target Portfolio are sometimes referred to herein individually as a “Portfolio” or collectively as the “Portfolios.” Each of the Acquiring Portfolio and the Target Portfolio is organized as a series of the Fund, an open-end investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The Target Portfolio is a diversified company and the Acquiring Portfolio is non-diversified company, each as defined under the 1940 Act.
The Board has fixed the close of business on July 10, 2020 as the record date (“Record Date”) for the determination of contractholders (“Contractholders”) entitled to notice of, and to vote at, the Meeting and all adjournments thereof. For ease of reference, the term “Shareholders” will be used in this Prospectus/Proxy Statement and the accompanying materials to refer collectively to both record owners and beneficial owners of shares of the Target Portfolio and Acquiring Portfolio (i.e., owners of variable life insurance contracts and variable annuity contracts (each, a “Variable Contract”) funded by the Portfolios and shareholders of the Portfolios) as of the Record Date.
This Prospectus/Proxy Statement sets forth concisely the information shareholders of the Target Portfolio ought to know before voting on the Reorganization. Please read it carefully and retain it for future reference.
The following documents, each having been filed with the Securities and Exchange Commission (the “SEC”), are incorporated herein by reference:
• | The Thrivent Series Fund, Inc. Prospectus, dated April 30, 2020 (the “Fund Prospectus”) with SEC file number 033-03677. |
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• | A Statement of Additional Information, dated [ ], 2020, relating to this Combined Prospectus/Proxy Statement (the “Reorganization SAI”) with SEC file number [ ]; |
• | The Thrivent Series Fund, Inc. Statement of Additional Information, dated April 30, 2020 (the “Fund SAI”) with SEC file number 033-03677. |
Copies of the foregoing may be obtained without charge by calling or writing the Portfolio as set forth below. If you wish to request the Reorganization SAI, please ask for the “Reorganization SAI.”
In addition, each Portfolio will furnish, without charge, a copy of its most recent annual report and subsequent semi-annual report, if any, to a Contractholder upon request.
Copies of each Portfolio’s most recent prospectus, statement of additional information, annual report and semi-annual report can be obtained at Thrivent.com as follows:
• | Variable Annuity Reference Center: https://www.thrivent.com/what-we-offer/insurance/annuities/variable-annuity-reference-center.html |
• | Variable Universal Life Reference Center: https://www.thrivent.com/what-we-offer/insurance/variable-universal-life-reference-center.html |
• | AdvisorFlex Variable Annuity Reference Center: https://www.thrivent.com/what-we-offer/insurance/annuities/thrivent-advisorflex-variable-annuity-reference-center.html |
Requests for these documents can also be made by calling 800-847-4836 or writing Thrivent Series Fund, Inc., 4321 North Ballard Road, Appleton, WI 54919. A copy of the Reorganization SAI can also be obtained from Mediant Communications at www.proxypush.com/THR.
The Portfolios file reports and other information with the SEC. Information filed by the Portfolios with the SEC can be reviewed on the EDGAR database on the SEC’s internet site (https://www.sec.gov). You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC’s e-mail address (publicinfo@sec.gov).
The Board knows of no business other than that discussed above that will be presented for consideration at the Meeting. If any other matter is properly presented, it is the intention of the persons named in the enclosed proxy to vote in accordance with their best judgment.
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No person has been authorized to give any information or make any representation not contained in this Prospectus/Proxy Statement and, if so given or made, such information or representation must not be relied upon as having been authorized. This Prospectus/Proxy Statement does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction in which, or to any person to whom, it is unlawful to make such offer or solicitation.
Neither the Securities and Exchange Commission nor any state regulator has approved or disapproved of these shares or passed upon the adequacy of this Prospectus/Proxy Statement. A representation to the contrary is a crime.
The date of this Prospectus/Proxy Statement is [ ], 2020. The Prospectus/Proxy Statement will be sent to Contractholders on or around [ ], 2020.
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The following is a summary of certain information contained elsewhere in this Prospectus/Proxy Statement and is qualified in its entirety by reference to the more complete information contained in this Prospectus/Proxy Statement. Contractholders should read the entire Prospectus/Proxy Statement carefully.
The Board, including the directors who are not “interested persons” (as defined in the 1940 Act) of each Portfolio (the “Independent Directors”), has unanimously approved an Agreement and Plan of Reorganization (the “Reorganization Agreement”) on behalf of each Portfolio, subject to Target Portfolio Contractholder approval. The Reorganization Agreement provides for:
• | the transfer of all of the assets of the Target Portfolio to the Acquiring Portfolio in exchange for shares of the Acquiring Portfolio; |
• | the distribution by the Target Portfolio of such Acquiring Portfolio shares to Target Portfolio shareholders; and |
• | the dissolution of the Target Portfolio. |
When the Reorganization is complete, Target Portfolio shareholders will hold Acquiring Portfolio shares. The aggregate value of the Acquiring Portfolio shares a Target Portfolio shareholder will receive in the Reorganization will equal the aggregate value of the Target Portfolio shares owned by such shareholder immediately prior to the Reorganization, but the overall number of shares held by Target Portfolio shareholders may change. After the Reorganization, the Acquiring Portfolio will continue to operate with the investment objective and investment policies set forth in this Prospectus/Proxy Statement. The Reorganization will not affect your Variable Contract.
As discussed in more detail elsewhere in this Prospectus/Proxy Statement, the Board believes that the Reorganization would be in the best interests of the Target Portfolio’s Contractholders because: (i) Contractholders will become contractholders of a larger combined portfolio with greater potential to increase asset size and achieve economies of scale; (ii) the Acquiring Portfolio has achieved better performance than the Target Portfolio for the one-, two- and three-year periods ended December 31, 2019, though there is no guarantee of future performance; (iii) Thrivent Financial, the Portfolios’ investment adviser, believes that it can most effectively manage the assets currently in the Target Portfolio by combining such assets with the Acquiring Portfolio; and (iv) the Acquiring Portfolio has a lower gross expense ratio than the Target Portfolio and shareholders of the Target Portfolio will experience a lower net expense ratio in the Acquiring Portfolio following the Reorganization.
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In addition, the Board, when determining whether to approve the Reorganization, considered, among other things, the future growth prospects of each of the Target Portfolio and the Acquiring Portfolio, the fact that the Target Portfolio Contractholders would not experience any diminution in contractholder services as a result of the Reorganization, and the fact that the Reorganization is expected to be a tax-free reorganization for federal income tax purposes.
Background and Reasons for the Reorganization
The Target Portfolio and the Acquiring Portfolio have similar investment objectives to seek long-term growth of capital, but the Target Portfolio has a secondary objective to increase dividend income while the Acquiring Portfolio does not.
The two Portfolios also have some similarities and some differences in their principal investment strategies, which are described in more detail in the COMPARISON OF THE PORTFOLIOS—Investment Objective and Principal Strategies section of the Prospectus/Proxy Statement. Both Portfolios invest in equity securities of domestic and international companies with potential above average earnings growth. The Target Portfolio also seeks investments in companies that have the ability to pay increasing dividends through strong cash flow. The Acquiring Portfolio focuses mainly on the equity securities of large domestic and international companies which have market capitalizations equivalent to those included in widely known indices such as the Russell 1000 Growth Index, S&P 500 Index, or the large company market capitalization classifications published by Lipper, Inc. These companies typically have a market capitalization of approximately $8 billion or more.
In determining whether to recommend approval of the Reorganization Agreement to Target Portfolio Contractholders, the Board considered a number of factors, including, but not limited to: (i) the expenses and advisory fees applicable to the Portfolios before the proposed Reorganization and the estimated expense ratios of the combined portfolio after the proposed Reorganization; (ii) the comparative investment performance of the Portfolios; (iii) the future growth prospects of each Portfolio; (iv) the terms and conditions of the Reorganization Agreement; (v) whether the Reorganization would result in the dilution of Contractholder interests; (vi) the compatibility of the Portfolios’ investment objectives, policies, risks and restrictions; (vii) that the proposed Reorganization was expected to be a tax-free reorganization for federal income tax purposes; (viii) the compatibility of the Portfolios’ service features available to Contractholders; and (ix) the estimated costs of the Reorganization, which, except for transaction costs, would be borne by Thrivent Financial for Lutherans (“Thrivent Financial” or the “Adviser”), the investment adviser of the Portfolios. The Board concluded that these factors supported a determination to approve the Reorganization Agreement.
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The Board has determined that the Reorganization is in the best interests of the Target Portfolio and that the interests of the Target Portfolio’s Contractholders will not be diluted as a result of the Reorganization. In addition, the Board has determined that the Reorganization is in the best interests of the Acquiring Portfolio and that the interests of the Acquiring Portfolio Contractholders will not be diluted as a result of the Reorganization.
The Board is asking Contractholders of the Target Portfolio to approve the Reorganization at the Meeting to be held on August 24, 2020. If Contractholders of the Target Portfolio approve the proposed Reorganization, it is expected that the closing date of the transaction (the “Closing Date”) will be after the close of business on or about August 31, 2020, but it may be at a different time as described herein.
Effect if Contractholders do not Approve the Reorganization of the Target Portfolio
If Contractholders of the Target Portfolio do not approve the proposed Reorganization, the Board will consider alternatives, including repurposing the Target Portfolio’s principal strategies.
The Board recommends that you vote “FOR” the Reorganization.
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Investment Objective and Principal Strategies
Investment Objective. The Target Portfolio and the Acquiring Portfolio have similar investment objectives to seek long-term growth of capital, but the Target Portfolio has a secondary objective to increase dividend income while the Acquiring Portfolio does not.
Principal Strategies. Both Portfolios invest in equity securities of domestic and international companies with potential above average earnings growth. The Target Portfolio also seeks investments in companies that have the ability to pay increasing dividends through strong cash flow. The Acquiring Portfolio focuses mainly on the equity securities of large domestic and international companies which have market capitalizations equivalent to those included in widely known indices such as the Russell 1000 Growth Index, S&P 500 Index, or the large company market capitalization classifications published by Lipper, Inc. These companies typically have a market capitalization of approximately $8 billion or more.
The Target Fund is managed by a subadviser, T. Rowe Price Associates, Inc. The Acquiring Fund is managed by the Adviser.
Portfolio Holdings. A description of the Portfolios’ policies and procedures with respect to the disclosure of the Portfolios’ portfolio securities is available on the Portfolios’ website.
The following table provides a side-by-side comparison of the investment objectives and principal strategies of the Target Portfolio and the Acquiring Portfolio.
Target Portfolio
| Acquiring Portfolio
| |||
Investment Objective | The investment objective of the Target Portfolio is to seek long-term growth of capital and, secondarily, increase dividend income. | The investment objective of the Acquiring Portfolio is to seek long-term growth of capital. |
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Target Portfolio
| Acquiring Portfolio
| |||
Principal Strategies | The Portfolio’s principal strategy for achieving its investment objectives under normal circumstances is to invest at least 80% of net assets (plus the amount of any borrowing for investment purposes) in common stocks. Should the Adviser determine that the Portfolio would benefit from reducing the percentage of its assets invested in common stocks from 80% to a lesser amount, it will notify you at least 60 days prior to such a change.
The Portfolio concentrates its investments in growth companies. The Portfolio’s subadviser, T. Rowe Price Associates, Inc. (“T. Rowe Price”), seeks investments in companies that have the ability to pay increasing dividends through strong cash flow. The subadviser generally looks for companies with an above-average rate of earnings growth and a lucrative niche in the economy that gives them the ability to sustain earnings momentum even during times of slow economic growth. T. Rowe Price believes that when a company increases its earnings faster than both inflation and the overall economy, the market will eventually reward it with a higher stock price. The Portfolio may at times invest significantly in certain sectors, such as the information technology sector.
In pursuing the Portfolio’s investment objectives, T. Rowe Price has the discretion to purchase some securities that do not meet its normal investment criteria, as described above, when it believes such purchase will provide an opportunity for substantial appreciation. These situations might arise when T. Rowe Price believes a security could increase in value for a variety of reasons including a change in management, an extraordinary corporate event, a new product introduction or innovation, or a favorable competitive development.
While the Portfolio invests primarily (at least 80%) in common stocks, it may also invest in foreign stocks (up to 30% of total assets), and futures and options to obtain investment exposure or for hedging, in keeping with the Portfolio’s objectives.
The Portfolio may sell securities for a variety of reasons, such as to secure gains, limit losses, or reposition assets into more promising opportunities. | Under normal circumstances, the Portfolio invests at least 80% of its net assets (plus the amount of any borrowing for investment purposes) in equity securities of large companies. The Adviser focuses mainly on the equity securities of large domestic and international companies which have market capitalizations equivalent to those included in widely known indices such as the Russell 1000 Growth Index, S&P 500 Index, or the large company market capitalization classifications published by Lipper, Inc. These companies typically have a market capitalization of approximately $8 billion or more. Should the Adviser change the investments used for purposes of this 80% threshold, you will be notified at least 60 days prior to the change.
The Portfolio seeks to achieve its investment objective by investing in common stocks. The Adviser uses fundamental, quantitative, and technical investment research techniques and focuses on stocks of companies that it believes have demonstrated and will sustain above-average earnings growth over time, or which are expected to develop rapid sales and earnings growth in the future when compared to the economy and stock market as a whole. Many such companies are in the technology sector and the Portfolio may at times have a higher concentration in this industry.
The Portfolio may sell securities for a variety of reasons, such as to secure gains, limit losses, or reposition assets into more promising opportunities. |
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The Portfolios are subject to similar principal risks, with a few differences. Shares of each Portfolio will rise and fall in value and there is a risk that you could lose money by investing in each Portfolio. The table below compares the principal risks of an investment in each Portfolio. The risks are listed alphabetically and each risk is described below the table.
Risk | Target Portfolio | Acquiring Portfolio | ||||||
Derivatives Risk | X | |||||||
Equity Security Risk | X | X | ||||||
Foreign Securities Risk | X | X | ||||||
Growth Investing Risk | X | X | ||||||
Health Crisis Risk | X | X | ||||||
Investment Adviser Risk | X | X | ||||||
Issuer Risk | X | X | ||||||
Large Cap Risk | X | |||||||
Market Risk | X | X | ||||||
Non-Diversified Risk | X | |||||||
Technology-Oriented Companies Risk | X | X |
Principal risks to which both Portfolios are subject
Equity Security Risk. Equity securities held by the Portfolio may decline significantly in price, sometimes rapidly or unpredictably, over short or extended periods of time, and such declines may occur because of declines in the equity market as a whole, or because of declines in only a particular country, company, industry, or sector of the market. From time to time, the Portfolio may invest a significant portion of its assets in companies in one or more related sectors or industries which would make the Portfolio more vulnerable to adverse developments affecting such sectors or industries. Equity securities are generally more volatile than most debt securities.
Foreign Securities Risk. Foreign securities generally carry more risk and are more volatile than their domestic counterparts, in part because of potential for higher political and economic risks, lack of reliable information and fluctuations in currency exchange rates where investments are denominated in currencies other than the U.S. dollar. Certain events in foreign markets may adversely affect foreign and domestic issuers, including interruptions in the global supply chain, natural disasters and outbreak of infectious diseases. The Portfolio’s investment in any country could be subject to governmental actions such as capital or currency controls, nationalizing a company or industry, expropriating assets, or imposing punitive taxes that would have an adverse effect on security prices, and impair the Portfolio’s ability to repatriate capital or income. Foreign securities may also be more difficult to resell than comparable U.S. securities because the markets for foreign securities are often less liquid. Even when a foreign security increases in price in its local currency, the appreciation may be diluted by adverse changes in exchange rates when the security’s value is converted to U.S. dollars. Foreign withholding taxes also may apply and errors and delays may occur in the settlement process for foreign securities.
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Growth Investing Risk. Growth style investing includes the risk of investing in securities whose prices historically have been more volatile than other securities, especially over the short term. Growth stock prices reflect projections of future earnings or revenues and, if a company’s earnings or revenues fall short of expectations, its stock price may fall dramatically.
Health Crisis Risk. The global pandemic outbreak of the novel coronavirus known as COVID-19 has resulted in substantial market volatility and global business disruption. The duration and full effects of the outbreak are uncertain and may result in trading suspensions and market closures, limit liquidity and the ability of the Portfolio to process shareholder redemptions, and negatively impact Portfolio performance. The COVID-19 outbreak and future pandemics could affect the global economy in ways that cannot be foreseen and may exacerbate other types of risks, negatively impacting the value of the Portfolio.
Investment Adviser Risk. The Portfolio is actively managed and the success of its investment strategy depends significantly on the skills of the Adviser in assessing the potential of the investments in which the Portfolio invests. This assessment of investments may prove incorrect, resulting in losses or poor performance, even in rising markets. There is also no guarantee that the Adviser will be able to effectively implement the Portfolio’s investment objective.
Issuer Risk. Issuer risk is the possibility that factors specific to an issuer to which the Portfolio is exposed will affect the market prices of the issuer’s securities and therefore the value of the Portfolio.
Market Risk. Over time, securities markets generally tend to move in cycles with periods when security prices rise and periods when security prices decline. The value of the Portfolio’s investments may move with these cycles and, in some instances, increase or decrease more than the applicable market(s) as measured by the Portfolio’s benchmark index(es). The securities markets may also decline because of factors that affect a particular industry or due to impacts from the spread of infectious illness, public health threats or similar issues.
Technology-Oriented Companies Risk. Common stocks of companies that rely extensively on technology, science or communications in their product development or operations may be more volatile than the overall stock market and may or may not move in tandem with the overall stock market. Technology, science and communications are rapidly changing fields, and stocks of these companies, especially of smaller or unseasoned companies, may be subject to more abrupt or erratic market movements than the stock market in general. There are significant competitive pressures among technology-oriented companies and the products or operations of such companies may become obsolete quickly. In addition, these companies may have limited product lines, markets or financial resources and the management of such companies may be more dependent upon one or a few key people.
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Additional principal risk to which only the Target Portfolio is subject
Derivatives Risk. The use of derivatives (such as futures and options) involves additional risks and transaction costs which could leave the Portfolio in a worse position than if it had not used these instruments. The Portfolio utilizes equity futures in order to increase or decrease its exposure to various asset classes at a lower cost than trading stocks directly. The use of derivatives can lead to losses because of adverse movements in the price or value of the underlying asset, index or rate, which may be magnified by certain features of the contract. Changes in the value of the derivative may not correlate as intended with the underlying asset, rate or index, and the Portfolio could lose much more than the original amount invested. Derivatives can be highly volatile, illiquid and difficult to value. Certain derivatives may also be subject to counterparty risk, which is the risk that the other party in the transaction will not fulfill its contractual obligations due to its financial condition, market events, or other reasons.
Additional principal risks to which only the Acquiring Portfolio is subject
Large Cap Risk. Large-sized companies may be unable to respond quickly to new competitive challenges such as changes in technology. They may also not be able to attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion.
Non-Diversified Risk. The Portfolio is not “diversified” within the meaning of the 1940 Act. That means the Portfolio may invest a greater percentage of its assets in the securities of any single issuer compared to other funds. A non-diversified portfolio is generally more susceptible than a diversified portfolio to the risk that events or developments affecting a particular issuer or industry will significantly affect the Portfolio’s performance.
The Target Portfolio is a diversified company as defined under the 1940 Act.
The Board. The Board has oversight responsibilities for each Portfolio and performs its fiduciary duties imposed on the directors of investment companies by the 1940 Act and under applicable state law.
The Adviser. Thrivent Financial is the investment adviser for each Portfolio and manages each Portfolio on a day-to-day basis. Thrivent Financial and its investment advisory affiliate, Thrivent Asset Management, LLC, have been in the investment advisory business since 1986 and managed approximately $132 billion in assets as of December 31, 2019, including approximately $55 billion in mutual fund assets. These advisory entities are located at 901 Marquette Avenue, Suite 2500, Minneapolis, Minnesota 55402.
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The Portfolios’ annual report to Contractholders discusses the basis for the Board approving the investment advisory agreement during the period covered by the report.
Portfolio Management. Thrivent Financial has engaged T. Rowe Price, 100 East Pratt Street, Baltimore, Maryland 21202, as investment subadviser for the Target Portfolio. T. Rowe Price and its affiliates had approximately $1.21 trillion in total assets under management as of December 31, 2019. Joseph B. Fath, CPA is primarily responsible for the day-to-day management of the Target Portfolio. Mr. Fath has served as the portfolio manager of the Target Portfolio since April 2014. He currently serves as Chairman of the Portfolio’s Investment Advisory Committee. Mr. Fath joined T. Rowe Price in 2002. He joined as an equity research analyst and, since 2008, has assisted other T. Rowe Price portfolio managers in managing the Firm’s U.S. large-cap growth strategies.
Lauri Brunner is primarily responsible for the day-to-day management of the Acquiring Portfolio, and she has served as portfolio manager of the Acquiring Portfolio since September 2018. Ms. Brunner has been with Thrivent Financial since 2007 and currently is a Senior Portfolio Manager. Ms. Brunner will continue to manage the Acquiring Portfolio following the Reorganization.
The Fund SAI provides information about the portfolio managers’ compensation, other accounts managed by the portfolio managers, and the portfolio managers’ ownership of shares of the Portfolios.
Advisory Fees. Each Portfolio pays an annual investment advisory fee to the Adviser. The advisory contract between the Adviser and the Fund provides for the following advisory fees for each Portfolio, expressed as an annual rate of average daily net assets:
Target Portfolio
0.650% of average daily net assets up to $250 million
0.625% of average daily net assets greater than $250 million up to $500 million
0.600% of average daily net assets greater than $500 million up to $1 billion
0.550% of average daily net assets over $1 billion
Acquiring Portfolio
0.400% for all assets
During the twelve-months ended December 31, 2019, the contractual advisory fees for the Target Portfolio were 0.650% of the Target Portfolio’s average daily net assets.
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During the twelve-months ended December 31, 2019, the contractual advisory fees for the Acquiring Portfolio were 0.400% of the Acquiring Portfolio’s average daily net assets.
For a complete description of each Portfolio’s advisory services, see the section of the Portfolio Prospectus entitled “Management” and the section of the Fund SAI entitled “Investment Adviser, Investment Subadvisers, and Portfolio Managers.”
The table below sets forth the fees and expenses that investors may pay to buy and hold shares of each of the Target Portfolio and the Acquiring Portfolio, including (i) the fees and expenses paid by the Target Portfolio for the twelve-month period ended December 31, 2019, (ii) the fees and expenses paid by the Acquiring Portfolio for the twelve-month period ended December 31, 2019, and (iii) pro forma fees and expenses for the Acquiring Portfolio for the twelve-month period ended December 31, 2019, assuming the Reorganization had been completed as of the beginning of such period. If you own a Variable Contract, you will have additional expenses, including mortality and expense risk charges. These additional contract-level expenses are not reflected in the table below.
Actual | Pro Forma | |||||||||||
Target Portfolio | Acquiring Portfolio | Acquiring Portfolio (assuming merger with Target Portfolio) | ||||||||||
Shareholder Fees (fees directly paid from your investment) | ||||||||||||
Maximum Sales Charge (Load) | N/A | N/A | N/A | |||||||||
Maximum Deferred Sales Charge (Load) | N/A | N/A | N/A | |||||||||
Annual Fund Operating Expenses as a Percentage of Average Net Assets (expenses that you pay each year as a percentage of the value of your investment) | ||||||||||||
Management Fees | 0.65 | % | 0.40 | % | 0.40 | % | ||||||
Other Expenses | 0.09 | % | 0.04 | % | 0.04 | % | ||||||
Total Annual Operating Expenses | 0.74 | % | 0.44 | % | 0.44 | % |
Example
The following example, using the actual and pro forma operating expenses for the twelve-month period ended December 31, 2019, is intended to help you compare the costs of investing in the Acquiring Portfolio pro forma after the Reorganization with the costs of investing in each of the Target Portfolio and the Acquiring Portfolio without the Reorganization. The example assumes that you invest $10,000 in each
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Portfolio for the time period indicated and that you redeem all of your shares at the end of each period. The example also assumes that your investments have a 5% return each year and that each Portfolio’s operating expenses remain the same each year. Although your actual returns may be higher or lower, based on these assumptions your costs would be:
Actual | Pro Forma | |||||||||||
Target Portfolio | Acquiring Portfolio | Acquiring Portfolio (assuming merger with the Target Portfolio) | ||||||||||
Total operating expenses assuming redemption at the end of the period | ||||||||||||
One Year | $ | 76 | $ | 45 | $ | 45 | ||||||
Three Years | $ | 237 | $ | 141 | $ | 141 | ||||||
Five Years | $ | 411 | $ | 246 | $ | 246 | ||||||
Ten Years | $ | 918 | $ | 555 | $ | 555 |
Portfolio Turnover
Each Portfolio pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Portfolio shares are held in a taxable account. These costs, which are not reflected in Total Annual Operating Expenses or in the Example, affect the Portfolios’ performance. During the fiscal year ended December 31, 2019, the Acquiring Portfolio’s and the Target Portfolio’s portfolio turnover rates were 58% and 29%, respectively, of the average value of their portfolios.
The price of a Portfolio’s shares is based on the Portfolio’s net asset value (“NAV”). Each Portfolio generally determines its NAV once daily at the close of regular trading on the New York Stock Exchange (“NYSE”), which is normally 4:00 p.m. Eastern Time. If the NYSE has an unscheduled early close but certain other markets remain open until their regularly scheduled closing time, the NAV may be determined as of the regularly scheduled closing time of the NYSE. If the NYSE and/or certain other markets close early due to extraordinary circumstances (e.g., weather, terrorism, etc.), the NAV may be calculated as of the early close of the NYSE and/or other markets. The NAV generally will not be determined on days when, due to extraordinary circumstances, the NYSE and/or certain other markets do not open for trading. The Portfolios generally do not determine NAV on holidays observed by the NYSE or on any other day when the NYSE is closed. The NYSE is regularly closed on Saturdays and Sundays, New Year’s Day, Martin Luther King, Jr. Day, Presidents’ Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
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Each Portfolio determines its NAV by adding the value of Portfolio assets, subtracting the Portfolio’s liabilities, and dividing the result by the number of outstanding shares. To determine the NAV, the other Portfolios generally value their securities at current market value using readily available market prices. If market prices are not available or if the Adviser determines that they do not accurately reflect fair value for a security, the Board has authorized the Adviser to make fair valuation determinations pursuant to policies approved by the Board. Fair valuation of a particular security is an inherently subjective process, with no single standard to utilize when determining a security’s fair value. In each case where a security is fair valued, consideration is given to the facts and circumstances relevant to the particular situation. This consideration includes a review of various factors set forth in the pricing policies adopted by the Board. For any portion of a Portfolio’s assets that are invested in other mutual funds, the NAV is calculated based upon the NAV of the mutual funds in which the Portfolio invests, and the prospectuses for those mutual funds explain the circumstances under which they will use fair value pricing and the effects of such a valuation.
Because many foreign markets close before the U.S. markets, significant events may occur between the close of the foreign market and the close of the U.S. markets, when the Portfolio’s assets are valued, that could have a material impact on the valuation of foreign securities (i.e., available price quotations for these securities may not necessarily reflect the occurrence of the significant event). The Fund, subject to oversight by the Board, evaluates the impact of these significant events and adjusts the valuation of foreign securities to reflect the fair value as of the close of the U.S. markets to the extent that the available price quotations do not, in the Adviser’s opinion, adequately reflect the occurrence of the significant events.
The separate accounts place an order to buy or sell shares of a respective Portfolio each business day. The amount of the order is based on the aggregate instructions from owners of the variable annuity contracts. Orders placed before the close of the NYSE on a given day by the separate accounts result in share purchases and redemptions at the NAV calculated as of the close of the NYSE that day.
Please note that the Target Portfolio and the Acquiring Portfolio have identical valuation policies. As a result, there will be no material change to the value of the Target Portfolio’s assets because of the Reorganization.
Also, the Target Portfolio and the Acquiring Portfolio have identical policies with respect to frequent purchases and redemptions and standing allocation orders (for more information, please see Policy Regarding Frequent Purchases and Redemptions and Standing Allocation Order disclosures in the Acquiring Portfolio’s Prospectus—these disclosures are incorporate herein by reference). The Reorganization will not affect these policies.
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The following table sets forth the capitalization of the Target Portfolio and the Acquiring Portfolio, as of May 29, 2020, and the pro forma capitalization of the Acquiring Portfolio as if the Reorganization occurred on that date. These numbers may differ as of the Closing Date.
Actual | Pro Forma | |||||||||||
Target Portfolio | Acquiring Portfolio | Acquiring Portfolio (assuming merger with the Target Portfolio) | ||||||||||
Net assets | ||||||||||||
Portfolio Net Assets | $ | 279,453,778 | $ | 1,637409,818 | $ | 1,916,863,595 | ||||||
Net asset value per share | ||||||||||||
Net asset value | $ | 29.62 | $ | 45.07 | $ | 45.07 | ||||||
Shares outstanding | ||||||||||||
Portfolio Shares | 9,434,991 | 36,329,407 | 42,529,681 |
The pro forma shares outstanding reflect the issuance by the Acquiring Portfolio of approximately 6,200,274 shares. Such issuance reflects the exchange of the assets of the Target Portfolio for newly issued shares of the Acquiring Portfolio at the pro forma net asset value per share. The aggregate value of the Acquiring Portfolio shares that a Target Portfolio shareholder receives in the Reorganization will equal the aggregate value of the Target Portfolio shares owned immediately prior to the Reorganization.
Annual Performance Information
The following chart shows the annual returns of the Target Portfolio since its inception and the Acquiring Portfolio for the past ten calendar years. The bar charts include the effects of each Portfolio’s expenses, but not charges or deductions against your Variable Contract. If these charges and deductions were included, returns would be lower than those shown.
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Target Portfolio
Acquiring Portfolio
As a result of market activity, current performance may vary from the figures shown.
The Target Portfolio’s total return for the three-month period from January 1, 2020 to March 31, 2020 was-14.73%. The Acquiring Portfolio’s total return for the three-month period from January 1, 2020 to March 31, 2020 was -11.15%. During the past 10 years, the Target Portfolio’s highest quarterly return was 18.98% (for the quarter ended March 31, 2012) and its lowest quarterly return was -14.56% (for the
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quarter ended September 30, 2011). During the past 10 years, the Acquiring Portfolio’s highest quarterly return was 16.67% (for the quarter ended March 31, 2012) and its lowest quarterly return was -17.08% (for the quarter ended September 30, 2011).
Comparative Performance Information
As a basis for evaluating each Portfolio’s performance and risks, the following table shows how each Portfolio’s performance compares with broad-based market indices that the Adviser believes are appropriate benchmarks for such Portfolio. Both Portfolios compare their performance against the Russell 1000 Growth Index, an unmanaged market capitalization-weighted index of growth-oriented stocks of the largest companies that are included in the Russell 1000 Index, and the S&P 500 Growth Index, which measures the performance of the growth stocks in the S&P 500 Index. Further, the table includes the effects of each Portfolio’s expenses, but not charges or deductions against your Variable Contract. If these charges and deductions were included, returns would be lower than those shown.
Average annual total returns are shown below for each Portfolio for the periods ended December 31, 2019 (the most recently completed calendar year prior to the date of this Prospectus/Proxy Statement). Remember that past performance of a Portfolio is not indicative of its future performance.
Average Annual Total Returns for the Period ended December 31, 2019
Target Portfolio | Acquiring Portfolio | |||||||||||||||||||||||
Past 1 Year | Past 5 Years | Since Inception (4/30/08) | Past 1 Year | Past 5 Years | Past 10 Years | |||||||||||||||||||
Applicable Portfolio | 31.38 | % | 14.22 | % | 14.85 | % | 32.90 | % | 13.84 | % | 13.70 | % | ||||||||||||
Russell 1000 Growth Index (reflects no deduction for fees, expenses or taxes) | 36.39 | % | 14.63 | % | 15.22 | % | 36.39 | % | 14.63 | % | 15.22 | % | ||||||||||||
S&P 500® Growth Index (reflects no deduction for fees, expenses or taxes) | 31.13 | % | 13.52 | % | 14.78 | % | 31.13 | % | 13.52 | % | 14.78 | % |
The Acquiring Portfolio’s and the Target Portfolio’s financial highlights for the fiscal year ended December 31, 2019, which are included in the Funds’ Prospectus and incorporated herein by reference, have been audited by PricewaterhouseCoopers LLP, independent registered public accounting firm, whose report thereon is included in the Annual Report to Shareholders. The financial highlights audited by PricewaterhouseCoopers LLP have been incorporated by reference in reliance on their reports given on their authority as experts in auditing and accounting.
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Thrivent Financial, 901 Marquette Avenue, Suite 2500, Minneapolis, Minnesota 55402, provides administrative personnel and services necessary to operate the Portfolios and receives an administration fee from the Portfolios. The custodian for the Portfolios is State Street Bank and Trust Company, One Lincoln Street, Boston, Massachusetts 02111. PricewaterhouseCoopers LLP, 45 South Seventh Street, Suite 3400, Minneapolis, MN 55402, serves as the Fund’s independent registered public accounting firm.
The Fund is an open-end management investment company registered under the Investment Company Act of 1940 (the “1940 Act”) and was organized as a Minnesota corporation on February 24, 1986. The Fund is made up of 33 separate series or “Portfolios.” Each Portfolio of the Fund, other than Thrivent Large Cap Growth Portfolio and Thrivent Partner Healthcare Portfolio, is diversified within the meaning of the 1940 Act. Each Portfolio is in effect a separate investment fund, and a separate class of capital stock of the Fund is issued with respect to each Portfolio.
The Fund’s organizational documents are filed as part of the Fund’s registration statement with the SEC, and Contractholders may obtain copies of such documents as described on the first page of this Prospectus/Proxy Statement and in the Questions and Answers preceding this Prospectus/Proxy Statement.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase a Portfolio through a broker-dealer or other financial intermediary (such as an insurance company), the Portfolio and its related companies may pay the intermediary for the sale of Portfolio shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Portfolio over another investment. Ask your salesperson or visit your financial intermediary’s website for more information.
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INFORMATION ABOUT THE REORGANIZATION
Under the Reorganization Agreement, the Target Portfolio will transfer all of its assets to the Acquiring Portfolio in exchange for shares of the Acquiring Portfolio. The Acquiring Portfolio shares issued to the Target Portfolio will have an aggregate value equal to the aggregate value of the Target Portfolio’s net assets immediately prior to the Reorganization. Upon receipt by the Target Portfolio of Acquiring Portfolio shares, the Target Portfolio will distribute such shares of the Acquiring Portfolio to Target Portfolio shareholders. Then, as soon as practicable after the Closing Date of the Reorganization, the Target Portfolio will dissolve under applicable state law. The Acquiring Portfolio anticipates selling approximately 47% of the market value of the Target Portfolio’s investments after the Reorganization. As of May 29, 2020, the Target Portfolio’s investments that the Acquiring Portfolio would anticipate selling have a market value of $130,403,977.46.
The Target Portfolio will distribute the Acquiring Portfolio shares received by it pro rata to Target Portfolio shareholders of record in exchange for their interest in shares of the Target Portfolio. Accordingly, as a result of the Reorganization, each Target Portfolio shareholder would own Acquiring Portfolio shares that would have an aggregate value immediately after the Reorganization equal to the aggregate value of that shareholder’s Target Portfolio shares immediately prior to the Reorganization. The interests of each of the Target Portfolio’s shareholders will not be diluted as a result of the Reorganization. However, as a result of the Reorganization, a shareholder of the Target Portfolio or the Acquiring Portfolio will hold a reduced percentage of ownership in the larger combined portfolio than the shareholder did in either of the separate Portfolios.
The Acquiring Portfolio will be the accounting survivor of the Reorganization.
No sales charge or fee of any kind will be assessed to Target Portfolio shareholders in connection with their receipt of Acquiring Portfolio shares in the Reorganization.
Approval of the Reorganization will constitute approval of amendments to any of the fundamental investment restrictions of the Target Portfolio that might otherwise be interpreted as impeding the Reorganization, but solely for the purpose of and to the extent necessary for consummation of the Reorganization.
Terms of the Reorganization Agreement
The following is a summary of the material terms of the Reorganization Agreement. The form of Reorganization Agreement is attached as Appendix A to the Reorganization SAI.
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Pursuant to the Reorganization Agreement, the Acquiring Portfolio will acquire all of the assets of the Target Portfolio on the Closing Date in exchange for shares of the Acquiring Portfolio. Subject to the Target Portfolio’s Contractholders approving the Reorganization, the Closing Date shall occur on August 31, 2020 or such other date as determined by an officer of the Fund.
On the Closing Date, the Target Portfolio will transfer to the Acquiring Portfolio all of its assets. The Acquiring Portfolio will in turn transfer to the Target Portfolio a number of its shares equal in value to the value of the net assets of the Target Portfolio transferred to the Acquiring Portfolio as of the Closing Date, as determined in accordance with the valuation method described in the Acquiring Portfolio’s then current prospectus. In order to minimize any potential for undesirable federal income and excise tax consequences in connection with the Reorganization, the Target Portfolio will distribute on or before the Closing Date all or substantially all of its undistributed net investment income (including net capital gains) as of such date.
The Target Portfolio expects to distribute shares of the Acquiring Portfolio received by the Target Portfolio to Contractholders of the Target Portfolio promptly after the Closing Date and then dissolve.
The Acquiring Portfolio and the Target Portfolio have made certain standard representations and warranties to each other regarding their capitalization, status and conduct of business. Unless waived in accordance with the Reorganization Agreement, the obligations of the parties to the Reorganization Agreement are conditioned upon, among other things:
• | the approval of the Reorganization by the Target Portfolio’s Contractholders; |
• | the absence of any rule, regulation, order, injunction or proceeding preventing or seeking to prevent the consummation of the transactions contemplated by the Reorganization Agreement; |
• | the receipt of all necessary approvals, registrations and exemptions under federal and state laws; |
• | the truth in all material respects as of the Closing Date of the representations and warranties of the parties and performance and compliance in all material respects with the parties’ agreements, obligations and covenants required by the Reorganization Agreement; |
• | the effectiveness under applicable law of the registration statement of the Acquiring Portfolio of which this Prospectus/Proxy Statement forms a part and the absence of any stop orders under the Securities Act of 1933, as amended, pertaining thereto; and |
• | the receipt of an opinion of counsel relating to the characterization of the Reorganization as a tax-free reorganization for federal income tax purposes (as further described herein under the heading “Material Federal Income Tax Consequences of the Reorganization”). |
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The Reorganization Agreement may be terminated or amended by the mutual consent of the parties either before or after approval thereof by the Contractholders of the Target Portfolio, provided that no such amendment after such approval shall be made if it would have a material adverse effect on the interests of such Target Portfolio’s Contractholders. The Reorganization Agreement also may be terminated by the non-breaching party if there has been a material misrepresentation, material breach of any representation or warranty, material breach of contract or failure of any condition to closing.
Reasons for the Proposed Reorganization
In determining whether to recommend approval of the Reorganization Agreement to Target Portfolio Contractholders, the Board considered a number of factors, including, but not limited to: (i) the expenses and advisory fees applicable to the Portfolios before the proposed Reorganization and the estimated expense ratios of the combined portfolio after the proposed Reorganization; (ii) the comparative investment performance of the Portfolios; (iii) the future growth prospects of each Portfolio; (iv) the terms and conditions of the Reorganization Agreement; (v) whether the Reorganization would result in the dilution of Contractholder interests; (vi) the compatibility of the Portfolios’ investment objectives, policies, risks and restrictions; (vii) that the proposed Reorganization was expected to be a tax-free reorganization for federal income tax purposes; (viii) the compatibility of the Portfolios’ service features available to Contractholders; and (ix) the estimated costs of the Reorganization, which, except for transaction costs, would be borne by the Adviser. The Board considered all factors presented to it, including any adverse factors as described above, and after due consideration concluded that these factors supported a determination to approve the Reorganization Agreement.
The Board believes that the Reorganization would be in the best interests of the Target Portfolio’s Contractholders because: (i) Contractholders will become Contractholders of a larger combined portfolio with greater potential to increase asset size and achieve economies of scale; (ii) the Acquiring Portfolio has achieved better performance than the Target Portfolio for the one-, two- and three-year periods ended December 31, 2019, though there is no guarantee of future performance; (iii) Thrivent Financial, the Portfolios’ investment adviser, believes that it can most effectively manage the assets currently in the Target Portfolio by combining such assets with the Acquiring Portfolio; and (iv) the Acquiring Portfolio has a lower gross expense ratio than the Target Portfolio and shareholders of the Target Portfolio will experience a lower net expense ratio in the Acquiring Portfolio following the Reorganization.
The Board has determined that the Reorganization is in the best interests of the Target Portfolio and that the interests of the Target Portfolio’s Contractholders will not be diluted as a result of the Reorganization. In addition, the Board has determined that
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the Reorganization is in the best interests of the Acquiring Portfolio and that the interests of the Acquiring Portfolio Contractholders will not be diluted as a result of the Reorganization.
Material Federal Income Tax Consequences of the Reorganization
The following is a general summary of the material anticipated U.S. federal income tax consequences of the Reorganization. This discussion is based upon the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations, court decisions, published positions of the Internal Revenue Service (“IRS”) and other applicable authorities, all as in effect on the date hereof and all of which are subject to change or differing interpretations (possibly with retroactive effect). This discussion is limited to U.S. persons who hold shares of the Target Portfolio as capital assets for U.S. federal income tax purposes on the date of the exchange. For federal income tax purposes, the Contractholders are not the shareholders of the Target Portfolio. Rather, Thrivent Financial and its separate accounts are the shareholders.
This summary does not address all of the U.S. federal income tax consequences that may be relevant to a particular Contractholder or to Contractholders who may be subject to special treatment under U.S. federal income tax laws. No assurance can be given that the IRS would not assert or that a court would not sustain a position contrary to any of the tax aspects described below. Contractholders should consult their own tax advisers as to the U.S. federal income tax consequences of the Reorganization to them, as well as the effects of state, local and non-U.S. tax laws.
The Reorganization is expected to be a tax-free reorganization for U.S. federal income tax purposes. It is a condition to closing the Reorganization that the Target Portfolio and the Acquiring Portfolio receive an opinion from Reed Smith LLP, special counsel to each Portfolio, dated as of the Closing Date, regarding the characterization of the Reorganization as a “reorganization” within the meaning of Section 368(a)(1) of the Code. As such a reorganization, the U.S. federal income tax consequences of the Reorganization can be summarized as follows: to the effect that on the basis of existing provisions of the Code, the Treasury regulations promulgated thereunder, current administrative rules and court decisions, generally for U.S. federal income tax purposes, except as noted below:
• | the Reorganization will constitute a reorganization within the meaning of Section 368(a)(1) of the Code, and the Target Portfolio and the Acquiring Portfolio will each be a “party to a reorganization” within the meaning of Section 368(b) of the Code; |
• | under Section 361 of the Code, no gain or loss will be recognized by the Target Portfolio upon the transfer of its assets to the Acquiring Portfolio in exchange for Acquiring Portfolio shares, or upon the distribution of Acquiring Portfolio shares by the Target Portfolio to its shareholders in liquidation; |
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• | under Section 1032 of the Code, no gain or loss will be recognized by the Acquiring Portfolio upon receipt of the assets transferred to the Acquiring Portfolio in exchange for Acquiring Portfolio shares; |
• | under Section 362(b) of the Code, the Acquiring Portfolio’s tax basis in each asset that the Acquiring Portfolio receives from the Target Portfolio will be the same as the Target Portfolio’s tax basis in such asset immediately prior to such exchange; |
• | under Section 1223(2) of the Code, the Acquiring Portfolio’s holding periods in each asset will include the Target Portfolio’s holding periods in such asset; |
• | under Section 354 of the Code, no gain or loss will be recognized by shareholders of the Target Portfolio on the distribution of Acquiring Portfolio shares to them in exchange for their shares of the Target Portfolio; |
• | under Section 358 of the Code, the aggregate tax basis of the Acquiring Portfolio shares that the Target Portfolio’s shareholders receive in exchange for their Target Portfolio shares will be the same as the aggregate tax basis of the Target Portfolio shares exchanged therefor; |
• | under Section 1223(1) of the Code, a Target Portfolio shareholder’s holding period for the Acquiring Portfolio shares received in the Reorganization will be determined by including the holding period for the Target Portfolio shares exchanged therefor, provided that the shareholder held the Target Portfolio shares as a capital asset on the date of the exchange; and |
• | under Section 381 of the Code, the Acquiring Portfolio will succeed to and take into account the items of the Target Portfolio described in Section 381(c) of the Code, subject to the conditions and limitations specified in Section 381, 382, 383 and 384 of the Code and the Treasury regulations thereunder. |
The opinion will be based on certain factual certifications made by the officers of the Target Portfolio and the Acquiring Portfolio and will also be based on customary assumptions such as the assumption that the Reorganization will be consummated in accordance with the Reorganization Agreement. The opinion is not a guarantee that the tax consequences of the Reorganization will be as described above. There is no assurance that the IRS or a court would agree with the opinion.
The Acquiring Portfolio intends to continue to be taxed under the rules applicable to regulated investment companies as defined in Section 851 of the Code which are the same rules currently applicable to the Target Portfolio. In connection with the Reorganization, on or before the Closing Date, the Target Portfolio will declare to its shareholders a dividend which, together with all of its previous distributions, will have the effect of distributing to shareholders all of its investment company taxable income (computed without regard to the deduction for dividends paid), net tax-exempt interest income and net capital gains through the Closing Date.
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Immediately prior to the Reorganization, the Target Portfolio is not expected to have any unutilized capital loss carryforwards. The final amount of unutilized capital loss carryforwards for the Target Portfolio is subject to change and will not be determined until the Closing Date. As of May 29, 2020, the capital loss carryforward of the Target Portfolio and the Acquiring Portfolio was $0 and $0, respectively.
Generally, the Acquiring Portfolio will succeed to the capital loss carryforwards of the Target Portfolio, subject to the limitations described below. If the Target Portfolio has capital loss carryforwards, such capital losses would, in the absence of the Reorganization, generally be available to offset Target Portfolio capital gains, thereby reducing the amount of capital gain net income that must be distributed to the Target Portfolio shareholders.
Under Sections 382 and 383 of the Code, an “equity structure shift” arising as a result of a reorganization under Section 368(a)(1) of the Code can result in limitations on the post-reorganization Portfolio’s use of capital loss carryforwards of the participating Portfolios. An “equity structure shift” can trigger limitations on capital loss carryforwards where there is a more than 50% change in the ownership of a Portfolio.
The Adviser does not anticipate a limitation on capital loss carryforwards because the Reorganization is not expected to result in a more than 50% change in ownership of the Target Portfolio or the Acquiring Portfolio and the Portfolios are not expected to have capital loss carryforwards.
It is expected that, as of the closing of the Reorganization, all of the Target Portfolio’s investments will be eligible investments of the Acquiring Portfolio. Nonetheless, the Acquiring Portfolio anticipates selling some of the Target Portfolio’s investments after the Reorganization. As of May 29, 2020, the Target Portfolio’s investments that the Acquiring Portfolio would anticipate selling are approximately 47% of the Target Portfolio’s net assets and have a market value of $130,403,977.46.
This summary of the U.S. federal income tax consequences of the Reorganization is made without regard to the particular facts and circumstances of any shareholder. Shareholders are urged to consult their own tax advisors as to the specific consequences to them of the Reorganization, including the applicability and effect of state, local, non-U.S. and other tax laws.
It is not expected that the Reorganization will be a taxable event for any contractholder.
Expenses of the Reorganization
All expenses of the Reorganization, except transaction costs, will be paid by the Adviser or an affiliate and will not be borne by shareholders of the Target Portfolio.
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Reorganization expenses include, but are not limited to: all costs related to the preparation and distribution of materials distributed to the Board; all expenses incurred in connection with the preparation of the Reorganization Agreement and a registration statement on Form N-14; SEC and state securities commission filing fees and legal and audit fees in connection with the Reorganization; the costs of printing and distributing this Prospectus/Proxy Statement; legal fees incurred preparing materials for the Boards attending the Board meetings and preparing the Board minutes; auditing fees associated with the Portfolio’s financial statements; portfolio transfer taxes (if any); and any similar expenses incurred in connection with the Reorganization. Management of the Portfolios estimates the total cost of the Reorganization to be approximately $80,000. If the Reorganization is not approved by Contractholders, the Adviser will still bear the costs of the proposed Reorganization.
Any brokerage charges associated with the purchase or disposition of portfolio investments by the Target Portfolio prior to the Reorganization will be borne by the Target Portfolio. Any brokerage charges associated with the purchase or disposition of portfolio investments by the Acquiring Portfolio after the Reorganization will be borne by the Acquiring Portfolio. These brokerage costs are estimated to be $70,250, which is less than one basis point of the Target Portfolio and the Acquiring Portfolio net assets as of May 29, 2020.
The Board has unanimously approved the Reorganization, subject to shareholder approval. Approval of the Reorganization requires the affirmative vote of a “Majority of the Outstanding Voting Securities” (as defined in the Articles of Incorporation) of the Target Portfolio, which is, under the 1940 Act, the lesser of (1) 67% or more of the shares of the Portfolio present at the Meeting if the holders of more than 50% of the outstanding shares of the Portfolio are present or represented by proxy, or (2) more than 50% of the outstanding shares of the Portfolio.
The Board recommends voting “FOR” the proposed Reorganization.
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ADDITIONAL INFORMATION ABOUT THE PORTFOLIOS
At the close of business on the Record Date, the Acquiring Portfolio had outstanding [ ] shares. As of the Record Date, [the directors and officers of the Acquiring Portfolio as a group owned less than 1% of the shares of the Acquiring Portfolio. As of the Record Date, no person was known by the Acquiring Portfolio to own beneficially or of record as much as 5% of the Acquiring Portfolio shares except as follows:]
Name | Shares Outstanding | Approximate Percentage of Ownership | ||||||
[ ] | [ | ] | [ | ]% |
At the close of business on the Record Date, the Target Portfolio had outstanding [ ] shares, which is the total number of possible votes on the proposed Reorganization. As of the Record Date, [the directors and officers of the Target Portfolio as a group owned less than 1% of the shares of the Target Portfolio. As of the Record Date, no person was known by the Target Portfolio to own beneficially or of record as much as 5% of the shares (principal holders) of the Target Portfolio except as follows:]
Name | Shares Outstanding | Approximate Percentage of Ownership | ||||||
[ ] | [ | ] | [ | ]% | ||||
[ ] | [ | ] | [ | ]% |
Under the 1940 Act, any person who owns more than 25% of the voting securities of another company is deemed a control person and is presumed to control such company. A control person may have a significant impact on the outcome of a shareholder vote.
Shares in the Fund may be sold, without sales charges, to:
• | Separate accounts of Thrivent Financial, which are used to fund benefits of Variable Contracts issued by Thrivent Financial; |
• | Separate accounts of other insurance companies not affiliated with Thrivent Financial; and |
• | Other Portfolios of the Fund. |
A Prospectus for the Variable Contract describes how the premiums and the assets relating to the variable contract may be allocated among one or more of the subaccounts that correspond to the Portfolios of the Fund.
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The Fund serves as the underlying investment vehicle for variable annuity contracts and variable life insurance policies that are funded through separate accounts established by Thrivent Financial or other insurance companies. It is possible that in the future, it may not be advantageous for variable life insurance separate accounts and variable annuity separate accounts to invest in the Portfolios at the same time. Although neither Thrivent Financial nor the Fund currently foresees any such disadvantage, the Fund’s Board monitors events in order to identify any material conflicts between such policy owners and contract owners. Material conflict could result from, for example, 1) changes in state insurance laws, 2) changes in federal income tax law, 3) changes in the investment management of a Portfolio, or 4) differences in voting instructions between those given by policy owners and those given by contract owners. Should it be necessary, the Board would determine what action if any, should be taken on response to any such conflicts.
As a result of differences in tax treatment and other considerations, a conflict could arise between the interests of the variable life insurance contract owners and variable annuity contract owners with respect to their investments in the Fund. The Fund’s Board will monitor events in order to identify the existence of any material irreconcilable conflicts and to determine what action if any, should be taken in response to any such conflicts.
VOTING AND MEETING INFORMATION
Approval of the Reorganization requires the affirmative vote of a “Majority of the Outstanding Voting Securities” (as defined in the Articles of Incorporation) of the Target Portfolio, which is, under the 1940 Act, the lesser of (1) 67% or more of the shares of the Target Portfolio present at the Meeting if the holders of more than 50% of the outstanding shares of the Portfolio are present or represented by proxy, or (2) more than 50% of the outstanding shares of the Target Portfolio.
Thrivent Financial, the sponsor of your Variable Contracts, is Shareholder of record of the shares of the Target Portfolio. Shareholders with investments in the Target Portfolio are entitled to provide proxy cards to Thrivent Financial for the shares related to their investments.
The Board has fixed the close of business on July 10, 2020, as the Record Date for the determination of Contractholders entitled to notice of, and to vote at, the Meeting. Target Portfolio shareholders on the Record Date are entitled to one vote for each share held, with no shares having cumulative voting rights.
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A majority of the shares of the Target Portfolio entitled to vote at the Meeting represented in person or by proxy constitutes a quorum. Thrivent Financial and its affiliates together are the record owners of a majority of the shares of the Target Portfolio. Thrivent Financial’s representation at the Meeting will therefore assure the presence of a quorum.
Target Portfolio Contractholders may vote in any one of four ways: (i) Internet, (ii) phone, (iii) mail, or (iv) at the online Meeting. Instructions on how to vote by Internet, phone and mail are included with the enclosed proxy materials. Contractholders who deliver voting instructions by methods (i), (ii) or (iii) may revoke them at any time prior to the Meeting by delivering a written notice of revocation, by executing another proxy card bearing a later date or by participating in the online Meeting and giving voting instructions in person. Merely participating in the online Meeting, however, will not revoke any previously submitted proxy. The required control number for Internet and telephone voting is printed on the enclosed proxy card. The control number is used to match voting proxy cards with Contractholders’ respective accounts and to ensure that, if multiple proxy cards are executed, shares are voted in accordance with the proxy card bearing the latest date. The Target Portfolio employs procedures for Internet and phone voting, such as requiring the control number from the proxy card in order to vote by either of these methods, which it considers to be reasonable to confirm that the instructions received are genuine. If reasonable procedures are employed, the Target Portfolio will not be liable for following Internet or phone votes which it believes to be genuine.
Abstentions and broker non-votes (i.e., where a nominee such as a broker holding shares for beneficial owners votes on certain matters pursuant to discretionary authority or instructions from beneficial owners, but with respect to one or more proposals does not receive instructions from beneficial owners or does not exercise discretionary authority) will be deemed present for quorum purposes. Abstentions and broker non-votes have the same effect as votes “AGAINST” the Reorganization.
All properly executed proxies received prior to the Meeting will be voted at the Meeting in accordance with the instructions marked thereon or otherwise as provided therein. Proxies received prior to the Meeting on which no vote is indicated will be voted “FOR” the approval of the proposed Reorganization.
If your voting instructions are not timely received, any shares of the Target Portfolio attributable to a Variable Contract will be voted by Thrivent Financial in proportion to the voting instructions received for all Variable Contracts participating in the proxy solicitation. This voting procedure may result in a relatively small number of Contractholders determining the outcome of the vote. No minimum response is
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required from Shareholders before Thrivent Financial will vote the Target Portfolio shares. If a proxy card is timely returned with no voting instructions, the shares of the Portfolio will be voted FOR the Reorganization.
Any shares of the Target Portfolio held by Thrivent Financial or any of its affiliates for their own account and any shares held in asset allocation portfolios managed by Thrivent Financial will be voted in proportion to the voting instructions received for all Variable Contracts participating in the solicitation.
Solicitation of proxies is being made primarily by the mailing of this Notice and Prospectus/Proxy Statement with its enclosures on or about July 27, 2020. Contractholders of the Target Portfolio whose shares are held by nominees, such as brokers, can vote their proxies by contacting their respective nominee. In addition to the solicitation of proxies by mail, employees of Thrivent Financial and its affiliates, without additional compensation, may solicit proxies in person or by phone, telegraph, facsimile or oral communication. The Target Portfolio may retain Mediant Communications (“Mediant”), a professional proxy solicitation firm, to assist with any necessary solicitation of proxies. However, Thrivent Financial anticipates that additional telephone solicitation by Mediant will not be necessary. Any proxy solicitation expenses will be paid by the Target Portfolio while certain indirect costs will be paid by Thrivent Financial, although the expectation is that there will be no additional expenses for proxy solicitation.
We ask that you mail your proxy card, for which no postage is required if mailed in the United States, or record your voting instructions by Internet or phone promptly regardless of whether you plan to attend the online Meeting.
In the event that a quorum is present at the Meeting but sufficient votes to approve the proposed Reorganization are not received, proxies (including abstentions and broker non-votes) will be voted in favor of one or more adjournments of the Meeting to permit further solicitation of proxies, provided that the Board determines that such an adjournment and additional solicitation is reasonable and in the interest of Contractholders based on a consideration of all relevant factors, including the nature of the particular proposal, the percentage of votes then cast, the percentage of negative votes cast, the nature of the proposed solicitation activities and the nature of the reasons for such further solicitation. Any such adjournment will require the affirmative vote of the holders of a majority of the outstanding shares voted at the session of the Meeting to be adjourned.
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Other Matters to Come Before the Meeting
The Board knows of no business other than that described in the Notice that will be presented for consideration at the Meeting.
Annual or Special Meetings of Contractholders
There will be no annual or further special meetings of Contractholders of the Fund unless required by applicable law or called by the Board in its discretion. Contractholders wishing to submit proposals for inclusion in a proxy statement for a subsequent Contractholder meeting should send their written proposals to the Secretary of the Fund, 901 Marquette Ave., Suite 2500, Minneapolis, Minnesota 55402. Contractholder proposals should be received in a reasonable time before the solicitation is made.
John D. Jackson
Assistant Secretary
Thrivent Series Fund, Inc.
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STATEMENT OF ADDITIONAL INFORMATION
Relating to the Acquisition of the Assets of
Thrivent Partner Growth Stock Portfolio
By and In Exchange for Shares of
Thrivent Large Cap Growth Portfolio
[ ], 2020
This Statement of Additional Information is available to the Contractholders of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”), a series of Thrivent Series Fund, Inc. (the “Registrant”), in connection with the proposed reorganization (“the Reorganization”) whereby all of the assets of the Target Portfolio would be transferred to Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”), a series of the Registrant, in exchange for Shares of the Acquiring Portfolio. Unless otherwise defined herein, capitalized terms have the meanings given to them in the Prospectus/Proxy Statement dated [ ], 2020 related to the Reorganization (the “Prospectus/Proxy Statement”). The Acquiring Portfolio and the Target Portfolio are sometimes referred to herein individually as a “Portfolio” or collectively as the “Portfolios.”
This Statement of Additional Information is not a prospectus and should be read in conjunction with the Prospectus/Proxy Statement. A copy of the Prospectus/Proxy Statement may be obtained without charge by writing to Mediant Communications, P.O. Box 8035, Cary, NC 27512-9916, calling toll-free 888-441-3205, or visiting www.proxypush.com/THR.
The Acquiring Portfolio will provide, without charge, upon the request of any person to whom this Statement of Additional Information is delivered, a copy of any and all documents that have been incorporated by reference in the registration statement of which this Statement of Additional Information is a part.
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Appendix B — Statement of Additional Information of the Registrant | B-1 |
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The Contractholders of the Target Portfolio are being asked to approve an Agreement and Plan of Reorganization (the “Reorganization Agreement”) pursuant to which the Target Portfolio would (i) transfer all of its assets to the Acquiring Portfolio in exchange for Shares of the Acquiring Portfolio, (ii) distribute such Acquiring Portfolio shares to Contractholders of the Target Portfolio, and (iii) dissolve. A form of the Reorganization Agreement is attached hereto as Appendix A.
ADDITIONAL INFORMATION ABOUT THE PORTFOLIOS
Incorporated herein by reference in its entirety is the Statement of Additional Information of the Registrant, dated April 30, 2020 and as supplemented through the date hereof, which was filed with the Securities and Exchange Commission (the “SEC”) on April 30, 2020 and is attached hereto as Appendix B.
Incorporated herein by reference in their respective entireties are:
(i) | the audited annual financial statements of the Target Portfolio, as of December 31, 2019, along with the opinion of independent registered public accounting firm, included as part of the Target Portfolio’s Form N-CSR as filed with the SEC on February 28, 2020; and |
(ii) | the audited annual financial statements of the Acquiring Portfolio, as of December 2019, along with the opinion of independent registered public accounting firm, included as part of the Acquiring Portfolio’s Form N-CSR as filed with the SEC on February 28, 2020. |
Annual reports referenced as part of a Portfolio’s filing on Form N-CSR may be obtained by following the instructions on the cover of this Statement of Additional Information and may be reviewed on the EDGAR database on the SEC’s Internet site (https://www.sec.gov). You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC’s e-mail address (publicinfo@sec.gov).
In addition to the financial statements incorporated herein by reference, this Statement of Additional Information contains the following pro forma information:
(i) | pro forma statements of assets and liabilities of Thrivent Partner Growth Stock Portfolio (Target Portfolio) and Thrivent Large Cap Growth Portfolio (Acquiring Portfolio) as of December 31, 2019. |
(ii) | pro forma statements of operations of Thrivent Partner Growth Stock Portfolio (Target Portfolio) and Thrivent Large Cap Growth Portfolio (Acquiring Portfolio) for the year ended December 31, 2019. |
(iii) | pro forma schedule of investments of Thrivent Partner Growth Stock Portfolio (Target Portfolio) and Thrivent Large Cap Growth Portfolio (Acquiring Portfolio) as of December 31, 2019. |
(iv) | notes to the pro forma financial statements of Thrivent Partner Growth Stock Portfolio (Target Portfolio) and Thrivent Large Cap Growth Portfolio (Acquiring Portfolio) as of December 31, 2019. |
This pro forma financial information gives effect to the proposed reorganization whereby all of the assets of the Target Portfolio would be transferred to the Acquiring Portfolio in exchange for Shares of the Acquiring Portfolio (earlier defined as a “Reorganization”). Under U.S. generally accepted accounting principles, the historical cost of investment securities will be applied to the surviving entity (i.e., the Acquiring Portfolio).
The unaudited pro forma combined statement of assets and liabilities and schedule of investments assumes that the Reorganization occurred on December 31, 2019, and the unaudited pro forma combined statement of operations, for the year ended December 31, 2019, presents the results of operations of the Acquiring Portfolio as if the Reorganization had occurred on the first business day following the year ended December 31, 2018. The pro forma results of operations are not necessarily indicative of actual future results of operations. The statements of asset and liabilities and schedule of investments have been derived from the books and records of the Target Portfolio and Acquiring Portfolio utilized in calculating net asset values at December 31, 2019. The pro forma statements of operations for the year ended December 31, 2019 have been derived from the books and records of each Target Portfolio and Acquiring Portfolio at December 31, 2019.
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The unaudited pro forma combined financial statements should be read in conjunction with the separate annual financial statements of the Target Portfolio and the Acquiring Portfolio, which are incorporated herein by reference.
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Thrivent Series Fund, Inc.
Pro Forma Statement of Assets and Liabilities
(Unaudited)
As of December 31, 2019 | Partner Growth Stock Portfolio | Large Cap Growth Portfolio | Pro-Forma Adjustments | Large Cap Growth Portfolio Pro-Forma Combined | ||||||||||||
Assets | ||||||||||||||||
Investments in unaffiliated securities at cost | $150,519,372 | $900,263,560 | $1,050,782,932 | |||||||||||||
Investments in affiliated securities at cost | $827,012 | $23,976,325 | $24,803,337 | |||||||||||||
Investments in unaffiliated securities at value (#) | 266,021,592 | 1,469,318,410 | 1,735,340,002 | |||||||||||||
Investments in affiliated securities at value | 827,012 | 23,976,325 | 24,803,337 | |||||||||||||
Cash | 1,944 | (a) | 1,138 | 3,082 | ||||||||||||
Dividends and interest receivable | 93,739 | 589,777 | 683,516 | |||||||||||||
Prepaid expenses | 1,157 | 2,058 | (948 | ) (c) | 2,267 | |||||||||||
Receivable for: | ||||||||||||||||
Investments sold | 572,344 | — | 572,344 | |||||||||||||
Fund shares sold | 3,760 | 5,983 | 9,743 | |||||||||||||
Total Assets | 267,521,548 | 1,493,893,691 | 1,761,414,291 | |||||||||||||
Liabilities | ||||||||||||||||
Accrued expenses | 12,918 | 11,004 | 70,250 | (d) | 94,172 | |||||||||||
Payable for: | ||||||||||||||||
Investments purchased | 548,169 | 2,985,702 | 3,533,871 | |||||||||||||
Return of collateral for securities loaned | — | 3,542,000 | 3,542,000 | |||||||||||||
Fund shares redeemed | 79,146 | 180,406 | 259,552 | |||||||||||||
Investment advisory fees | 149,666 | 513,994 | 663,660 | |||||||||||||
Administrative service fees | 3,922 | 21,844 | 25,766 | |||||||||||||
Director fees | 154 | 855 | 1,009 | |||||||||||||
Director deferred compensation | 20,843 | 240,307 | 261,150 | |||||||||||||
Contingent liabilities^ | — | — | — | |||||||||||||
Total Liabilities | 814,818 | 7,496,112 | 8,381,180 | |||||||||||||
Net Assets | ||||||||||||||||
Capital stock (beneficial interest) | 147,627,411 | 815,412,806 | 963,040,217 | |||||||||||||
Distributable earnings/(accumulated loss) | 119,079,319 | 670,984,773 | (71,198 | ) (e) | 789,992,894 | |||||||||||
Total Net Assets | $266,706,730 | $1,486,397,579 | $1,753,033,111 | |||||||||||||
Shares of beneficial interest outstanding | 9,480,156 | 36,325,132 | 6,516,131 | (b) | 42,841,263 | |||||||||||
Net asset value per share | $28.13 | $40.92 | $40.92 | |||||||||||||
(#) Includes securities on loan of | $— | $3,503,360 | $3,503,360 |
(a) Includes foreign currency holdings of $1,916 (cost $1,888).
(b) The adjustment is necessary to reflect capital shares outstanding post-reorganization.
(c) Represents prepaid expense adjustment for the combined Acquiring Portfolio.
(d) Represents estimated brokerage costs on sales of current Target Portfolio holdings by the combined Acquiring Portfolio for the reorganization.
(e) Represents prepaid expense adjustment for the combined Acquiring Portfolio of $948 and estimated brokerage costs on sales of current Target Portfolio holdings by the combined Acquiring Portfolio of $70,250 for the reorganization.
(^) Contingent liabilities accrual. Additional information can be found in the accompanying Pro Forma Notes to Financial Statements.
The accompanying Pro Forma Notes to Financial Statements are an integral part of this statement.
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Thrivent Series Fund, Inc.
Pro Forma Statement of Operations
(Unaudited)
For the year ended December 31, 2019 | Partner Growth Stock Portfolio | Large Cap Growth Portfolio | Pro-Forma Adjustments | Large Cap Growth Portfolio Pro-Forma Combined (f) | ||||||||||||||
Investment Income | ||||||||||||||||||
Dividends | $1,883,018 | $10,926,488 | $12,809,506 | |||||||||||||||
Interest | 3,657 | 500 | $4,157 | |||||||||||||||
Affiliated income from securities loaned, net | 560 | 5,391 | $5,951 | |||||||||||||||
Income from affiliated investments | 67,411 | 519,623 | $587,034 | |||||||||||||||
Foreign tax withholding | (11,135 | ) | — | ($11,135 | ) | |||||||||||||
Total Investment Income | 1,943,511 | 11,452,002 | 13,395,513 | |||||||||||||||
Expenses | ||||||||||||||||||
Adviser fees | 1,587,442 | 5,513,779 | (610,302 | ) | 6,490,919 | (a) | ||||||||||||
Administrative service fees | 131,529 | 324,336 | (90,000 | ) | 365,865 | (b) | ||||||||||||
Audit and legal fees | 35,540 | 40,619 | (33,668 | ) | 42,491 | (c) | ||||||||||||
Custody fees | 14,085 | 14,188 | (12,130 | ) | 16,143 | (d) | ||||||||||||
Insurance expenses | 4,578 | 8,137 | (3,811 | ) | 8,904 | (d) | ||||||||||||
Printing and postage expenses | — | 70,678 | 70,678 | (e) | ||||||||||||||
Directors’ fees | 8,669 | 58,246 | (1,645 | ) | 65,270 | (d) | ||||||||||||
Other expenses | 15,443 | 25,259 | (4,676 | ) | 36,026 | (d) | ||||||||||||
Total Expenses Before Reimbursement | 1,797,286 | 6,055,242 | 7,096,296 | |||||||||||||||
Total Net Expenses | 1,797,286 | 6,055,242 | 7,096,296 | |||||||||||||||
Net Investment Income/(Loss) | 146,225 | 5,396,760 | 6,299,217 | |||||||||||||||
Realized and Unrealized Gains/(Losses) | ||||||||||||||||||
Net realized gains/(losses) on: | ||||||||||||||||||
Investments | 4,260,541 | 97,341,858 | 101,602,399 | |||||||||||||||
Distributions of realized capital gains from affiliated investments | 9 | 163 | 172 | |||||||||||||||
Foreign currency transactions | 1,480 | — | 1,480 | |||||||||||||||
Change in net unrealized appreciation/(depreciation) on: | ||||||||||||||||||
Investments | 60,085,518 | 278,534,274 | 338,619,792 | |||||||||||||||
Foreign currency transactions | 45 | — | 45 | |||||||||||||||
Net Realized and Unrealized Gains/(Losses) | 64,347,593 | 375,876,295 | 440,223,888 | |||||||||||||||
Net Increase/(Decrease) in Net Assets Resulting From Operations | $64,493,818 | $381,273,055 | $446,523,105 |
(a) assumes an advisory fee of 40 bps
(b) assumes fixed administrative fees of $90,000 and variable administrative fees of 1.7 bps
(c) assumes $30,958 for audit and tax services and $11,533 for legal fees
(d) assumes expense of surviving portfolio with adjustment for target portfolio fees
(e) Printing and postage was a one time proxy charge for the surviving portfolio in 2019
(f) Thrivent Large Cap Growth Portfolio is the accounting survivor.
The accompanying Pro Forma Notes to Financial Statements are an integral part of this statement.
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Pro Forma Schedule of Investments (Unaudited) - December 31, 2019
Thrivent Partner Growth Stock Portfolio and Large Cap Growth Portfolio
Common Stock (99.0%) | Partner Growth Stock Portfolio Shares | Large Cap Growth Portfolio Shares | Combined Pro Forma Shares (assuming merger with Target Portfolio) | Partner Growth Stock Portfolio Value | Large Cap Growth Portfolio Value | Combined Pro Forma Value (assuming merger with Target Portfolio) | ||||||||||||||||||
Communications Services (13.6%) | ||||||||||||||||||||||||
Activision Blizzard, Inc. | 0 | 395,142 | 395,142 | $0 | $23,479,338 | $23,479,338 | ||||||||||||||||||
Alphabet, Inc., Class A(a) | 6,375 | 77,308 | 83,683 | 8,538,611 | 103,545,562 | 112,084,173 | ||||||||||||||||||
Alphabet, Inc., Class C(a,d) | 6,205 | 0 | 6,205 | 8,296,209 | 0 | 8,296,209 | ||||||||||||||||||
Facebook, Inc.(a) | 75,415 | 327,437 | 402,852 | 15,478,929 | 67,206,444 | 82,685,373 | ||||||||||||||||||
IAC/InterActiveCorp(a,d) | 7,436 | 0 | 7,436 | 1,852,382 | 0 | 1,852,382 | ||||||||||||||||||
Match Group, Inc.(a,d) | 10,357 | 0 | 10,357 | 850,413 | 0 | 850,413 | ||||||||||||||||||
Spotify Technology SA(a,d) | 8,333 | 0 | 8,333 | 1,246,200 | 0 | 1,246,200 | ||||||||||||||||||
Tencent Holdings, Ltd. (d) | 93,200 | 0 | 93,200 | 4,490,018 | 0 | 4,490,018 | ||||||||||||||||||
Tencent Music Entertainment Group ADR(a) | 97,213 | 0 | 97,213 | 1,141,281 | 0 | 1,141,281 | ||||||||||||||||||
Walt Disney Company | 20,635 | 0 | 20,635 | 2,984,440 | 0 | 2,984,440 | ||||||||||||||||||
Total | 44,878,483 | 194,231,344 | 239,109,827 | |||||||||||||||||||||
Consumer Discretionary (18.7%) | ||||||||||||||||||||||||
Alibaba Group Holding, Ltd. ADR(a) | 42,328 | 146,649 | 188,977 | 8,977,769 | 31,104,253 | 40,082,022 | ||||||||||||||||||
Amazon.com, Inc.(a) | 9,480 | 83,283 | 92,763 | 17,517,523 | 153,893,659 | 171,411,182 | ||||||||||||||||||
Aptiv plc (d) | 26,407 | 0 | 26,407 | 2,507,873 | 0 | 2,507,873 | ||||||||||||||||||
Booking Holdings, Inc.(a) | 1,222 | 0 | 1,222 | 2,509,658 | 0 | 2,509,658 | ||||||||||||||||||
Dollar General Corporation | 6,134 | 0 | 6,134 | 956,781 | 0 | 956,781 | ||||||||||||||||||
Dollar Tree, Inc.(a) | 19,968 | 0 | 19,968 | 1,877,990 | 0 | 1,877,990 | ||||||||||||||||||
Dollarama, Inc. (d) | 58,105 | 0 | 58,105 | 1,997,017 | 0 | 1,997,017 | ||||||||||||||||||
Ferrari NV (d) | 14,604 | 0 | 14,604 | 2,417,546 | 0 | 2,417,546 | ||||||||||||||||||
Home Depot, Inc. | 0 | 153,427 | 153,427 | 0 | 33,505,388 | 33,505,388 | ||||||||||||||||||
Las Vegas Sands Corporation (d) | 26,194 | 0 | 26,194 | 1,808,434 | 0 | 1,808,434 | ||||||||||||||||||
Lululemon Athletica, Inc.(a,d) | 6,900 | 0 | 6,900 | 1,598,523 | 0 | 1,598,523 | ||||||||||||||||||
Mercadolibre, Inc.(a) | 1,265 | 0 | 1,265 | 723,504 | 0 | 723,504 | ||||||||||||||||||
MGM Resorts International | 37,476 | 0 | 37,476 | 1,246,827 | 0 | 1,246,827 | ||||||||||||||||||
Netflix, Inc.(a,d) | 18,288 | 0 | 18,288 | 5,917,448 | 0 | 5,917,448 | ||||||||||||||||||
NIKE, Inc. | 22,501 | 314,421 | 336,922 | 2,279,576 | 31,853,992 | 34,133,568 | ||||||||||||||||||
NVR, Inc.(a) | 133 | 0 | 133 | 506,519 | 0 | 506,519 | ||||||||||||||||||
Restaurant Brands International, Inc. | 8,524 | 0 | 8,524 | 543,575 | 0 | 543,575 | ||||||||||||||||||
Starbucks Corporation | 0 | 217,463 | 217,463 | 0 | 19,119,347 | 19,119,347 | ||||||||||||||||||
Tesla, Inc.(a) | 3,700 | 0 | 3,700 | 1,547,821 | 0 | 1,547,821 | ||||||||||||||||||
Ulta Beauty, Inc.(a,d) | 2,790 | 0 | 2,790 | 706,261 | 0 | 706,261 | ||||||||||||||||||
Wynn Resorts, Ltd. (d) | 19,219 | 0 | 19,219 | 2,668,943 | 0 | 2,668,943 | ||||||||||||||||||
Total | 58,309,588 | 269,476,639 | 327,786,227 | |||||||||||||||||||||
Consumer Staples (2.4%) | ||||||||||||||||||||||||
Monster Beverage Corporation(a) | 0 | 315,626 | 315,626 | 0 | 20,058,032 | 20,058,032 | ||||||||||||||||||
Philip Morris International, Inc. | 17,161 | 237,222 | 254,383 | 1,460,230 | 20,185,220 | 21,645,450 | ||||||||||||||||||
Total | 1,460,230 | 40,243,252 | 41,703,482 | |||||||||||||||||||||
Energy (0.1%) | ||||||||||||||||||||||||
Concho Resources, Inc. (d) | 8,500 | 0 | 8,500 | 744,345 | 0 | 744,345 | ||||||||||||||||||
Pioneer Natural Resources Company (d) | 7,346 | 0 | 7,346 | 1,111,964 | 0 | 1,111,964 | ||||||||||||||||||
Total | 1,856,309 | 0 | 1,856,309 | |||||||||||||||||||||
Financials (4.9%) | ||||||||||||||||||||||||
Bank of America Corporation | 0 | 385,677 | 385,677 | 0 | 13,583,544 | 13,583,544 | ||||||||||||||||||
Charles Schwab Corporation | 0 | 509,150 | 509,150 | 0 | 24,215,174 | 24,215,174 | ||||||||||||||||||
Chubb, Ltd. (d) | 11,569 | 0 | 11,569 | 1,800,830 | 0 | 1,800,830 | ||||||||||||||||||
Intercontinental Exchange, Inc. | 12,585 | 235,434 | 248,019 | 1,164,742 | 21,789,417 | 22,954,159 | ||||||||||||||||||
S&P Global, Inc. | 0 | 80,230 | 80,230 | 0 | 21,906,801 | 21,906,801 | ||||||||||||||||||
TD Ameritrade Holding Corporation (d) | 32,161 | 0 | 32,161 | 1,598,402 | 0 | 1,598,402 | ||||||||||||||||||
XP, Inc.(a,d) | 7,439 | 0 | 7,439 | 286,550 | 0 | 286,550 | ||||||||||||||||||
Total | 4,850,524 | 81,494,936 | 86,345,460 | |||||||||||||||||||||
Health Care (13.3%) | ||||||||||||||||||||||||
Alcon, Inc.(a,d) | 22,676 | 0 | 22,676 | 1,284,405 | 0 | 1,284,405 | ||||||||||||||||||
Alexion Pharmaceuticals, Inc.(a,d) | 7,634 | 0 | 7,634 | 825,617 | 0 | 825,617 | ||||||||||||||||||
Anthem, Inc. (d) | 8,343 | 0 | 8,343 | 2,519,836 | 0 | 2,519,836 | ||||||||||||||||||
Becton, Dickinson and Company (d) | 12,161 | 0 | 12,161 | 3,307,427 | 0 | 3,307,427 | ||||||||||||||||||
Centene Corporation(a,d) | 41,202 | 0 | 41,202 | 2,590,370 | 0 | 2,590,370 | ||||||||||||||||||
Cigna Holding Company (d) | 11,580 | 0 | 11,580 | 2,367,994 | 0 | 2,367,994 | ||||||||||||||||||
Edwards Lifesciences Corporationa | 0 | 100,118 | 100,118 | 0 | 23,356,528 | 23,356,528 | ||||||||||||||||||
HCA Healthcare, Inc. (d) | 16,138 | 0 | 16,138 | 2,385,358 | 0 | 2,385,358 | ||||||||||||||||||
Illumina, Inc.(a) | 0 | 62,051 | 62,051 | 0 | 20,584,799 | 20,584,799 | ||||||||||||||||||
Intuitive Surgical, Inc.(a) | 6,796 | 58,285 | 65,081 | 4,017,456 | 34,455,178 | 38,472,634 | ||||||||||||||||||
Stryker Corporation (d) | 19,748 | 0 | 19,748 | 4,145,895 | 0 | 4,145,895 | ||||||||||||||||||
Thermo Fisher Scientific, Inc. | 0 | 62,578 | 62,578 | 0 | 20,329,715 | 20,329,715 | ||||||||||||||||||
UnitedHealth Group, Inc. (d) | 16,813 | 142,615 | 159,428 | 4,942,686 | 41,925,957 | 46,868,643 | ||||||||||||||||||
Vertex Pharmaceuticals, Inc.(a) | 17,681 | 126,960 | 144,641 | 3,871,255 | 27,797,892 | 31,669,147 | ||||||||||||||||||
Wellcare Health Plans, Inc.(a) | 2,568 | 0 | 2,568 | 847,979 | 0 | 847,979 | ||||||||||||||||||
Zoetis, Inc. | 0 | 234,817 | 234,817 | 0 | 31,078,030 | 31,078,030 | ||||||||||||||||||
Total | 33,106,278 | 199,528,099 | 232,634,377 | |||||||||||||||||||||
Industrials (6.1%) | ||||||||||||||||||||||||
Boeing Company | 22,538 | 47,359 | 69,897 | 7,341,979 | 15,427,668 | 22,769,647 | ||||||||||||||||||
Equifax, Inc. (d) | 8,347 | 0 | 8,347 | 1,169,582 | 0 | 1,169,582 | ||||||||||||||||||
Fortive Corporation (d) | 29,073 | 0 | 29,073 | 2,220,886 | 0 | 2,220,886 | ||||||||||||||||||
General Electric Company (d) | 61,000 | 0 | 61,000 | 680,760 | 0 | 680,760 | ||||||||||||||||||
Honeywell International, Inc. | 3,458 | 166,941 | 170,399 | 612,066 | 29,548,557 | 30,160,623 | ||||||||||||||||||
JB Hunt Transport Services, Inc. (d) | 12,828 | 0 | 12,828 | 1,498,054 | 0 | 1,498,054 | ||||||||||||||||||
Linde Public Limited Company (d) | 7,507 | 0 | 7,507 | 1,598,240 | 0 | 1,598,240 | ||||||||||||||||||
Lockheed Martin Corporation | 0 | 47,090 | 47,090 | 0 | 18,335,904 | 18,335,904 | ||||||||||||||||||
Norfolk Southern Corporation | 0 | 94,738 | 94,738 | 0 | 18,391,488 | 18,391,488 | ||||||||||||||||||
Roper Industries, Inc. (d) | 8,916 | 0 | 8,916 | 3,158,315 | 0 | 3,158,315 | ||||||||||||||||||
TransUnion | 31,695 | 0 | 31,695 | 2,713,409 | 0 | 2,713,409 | ||||||||||||||||||
Union Pacific Corporation (d) | 7,200 | 0 | 7,200 | 1,301,688 | 0 | 1,301,688 | ||||||||||||||||||
Wabtec Corporation (d) | 29,787 | 0 | 29,787 | 2,317,428 | 0 | 2,317,428 | ||||||||||||||||||
Total | 24,612,407 | 81,703,617 | 106,316,024 | |||||||||||||||||||||
Information Technology (37.4%) | ||||||||||||||||||||||||
Adobe, Inc.(a) | 0 | 45,115 | 45,115 | 0 | 14,879,378 | 14,879,378 | ||||||||||||||||||
Advanced Micro Devices, Inc.(a, d) | 32,100 | 0 | 32,100 | 1,472,106 | 0 | 1,472,106 | ||||||||||||||||||
Apple, Inc. | 42,378 | 319,943 | 362,321 | 12,444,300 | 93,951,262 | 106,395,562 | ||||||||||||||||||
ASML Holding NV GDR (d) | 9,857 | 0 | 9,857 | 2,917,081 | 0 | 2,917,081 | ||||||||||||||||||
Atlassian Corporation plca | 5,107 | 0 | 5,107 | 614,576 | 0 | 614,576 | ||||||||||||||||||
Fidelity National Information Services, Inc. (d) | 39,861 | 0 | 39,861 | 5,544,266 | 0 | 5,544,266 | ||||||||||||||||||
Fiserv, Inc.(a,d) | 30,390 | 126,282 | 156,672 | 3,513,996 | 14,601,988 | 18,115,984 | ||||||||||||||||||
Global Payments, Inc. (d) | 13,342 | 0 | 13,342 | 2,435,716 | 0 | 2,435,716 | ||||||||||||||||||
Hexagon AB (d) | 22,801 | 0 | 22,801 | 1,278,026 | 0 | 1,278,026 | ||||||||||||||||||
Intuit, Inc. | 13,602 | 80,411 | 94,013 | 3,562,772 | 21,062,053 | 24,624,825 | ||||||||||||||||||
Marvell Technology Group, Ltd. (d) | 86,673 | 0 | 86,673 | 2,302,035 | 0 | 2,302,035 | ||||||||||||||||||
MasterCard, Inc. | 31,133 | 197,099 | 228,232 | 9,296,002 | 58,851,790 | 68,147,792 | ||||||||||||||||||
Microsoft Corporation | 104,683 | 804,027 | 908,710 | 16,508,509 | 126,795,058 | 143,303,567 |
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NVIDIA Corporation | 0 | 91,747 | 91,747 | 0 | 21,588,069 | 21,588,069 | ||||||||||||||||||
Paycom Software, Inc.(a,d) | 3,842 | 0 | 3,842 | 1,017,208 | 0 | 1,017,208 | ||||||||||||||||||
PayPal Holdings, Inc.(a) | 22,163 | 336,353 | 358,516 | 2,397,372 | 36,383,304 | 38,780,676 | ||||||||||||||||||
Salesforce.com, Inc.(a) | 29,163 | 231,045 | 260,208 | 4,743,070 | 37,577,159 | 42,320,229 | ||||||||||||||||||
ServiceNow, Inc.(a) | 11,002 | 92,967 | 103,969 | 3,106,085 | 26,246,443 | 29,352,528 | ||||||||||||||||||
Slack Technologies, Inc.(a,d) | 43,480 | 0 | 43,480 | 977,430 | 0 | 977,430 | ||||||||||||||||||
Splunk, Inc.(a,d) | 19,843 | 0 | 19,843 | 2,971,886 | 0 | 2,971,886 | ||||||||||||||||||
Square, Inc.(a,b) | 0 | 185,791 | 185,791 | 0 | 11,623,085 | 11,623,085 | ||||||||||||||||||
Texas Instruments, Inc. | 0 | 174,020 | 174,020 | 0 | 22,325,026 | 22,325,026 | ||||||||||||||||||
Temenos AG (d) | 9,322 | 0 | 9,322 | 1,474,641 | 0 | 1,474,641 | ||||||||||||||||||
Visa, Inc. | 55,410 | 406,949 | 462,359 | 10,411,539 | 76,465,717 | 86,877,256 | ||||||||||||||||||
VMware, Inc. (d) | 13,995 | 0 | 13,995 | 2,124,301 | 0 | 2,124,301 | ||||||||||||||||||
Workday, Inc.(a,d) | 9,325 | 0 | 9,325 | 1,533,496 | 0 | 1,533,496 | ||||||||||||||||||
Zoom Video Communications, Inc.(a) | 950 | 0 | 950 | 64,638 | 0 | 64,638 | ||||||||||||||||||
Total | 92,711,051 | 562,350,332 | 655,061,383 | |||||||||||||||||||||
Materials (1.0%) | ||||||||||||||||||||||||
Ecolab, Inc. | 0 | 94,805 | 94,805 | 0 | 18,296,417 | 18,296,417 | ||||||||||||||||||
Total | 0 | 18,296,417 | 18,296,417 | |||||||||||||||||||||
Real Estate (1.3%) | ||||||||||||||||||||||||
American Tower Corporation | 0 | 95,700 | 95,700 | 0 | 21,993,774 | 21,993,774 | ||||||||||||||||||
Total | 0 | 21,993,774 | 21,993,774 | |||||||||||||||||||||
Utilities (0.2%) | ||||||||||||||||||||||||
NextEra Energy, Inc. | 6,929 | 0 | 6,929 | 1,677,927 | 0 | 1,677,927 | ||||||||||||||||||
Sempra Energy (d) | 14,580 | 0 | 14,580 | 2,208,578 | 0 | 2,208,578 | ||||||||||||||||||
Total | 3,886,505 | 0 | 3,886,505 | |||||||||||||||||||||
Total Common Stock (Cost $150,399,553, Cost $900,263,560, Combined $1,050,663,113 | 265,671,375 | 1,469,318,410 | 1,734,989,785 | |||||||||||||||||||||
Preferred Stock (0.0%) | ||||||||||||||||||||||||
Consumer Discretionary (0.0%) | ||||||||||||||||||||||||
Airbnb, Inc., Series D, Convertible(a,c,d) | 2,943 | 0 | 2,943 | 350,217 | 0 | 350,217 | ||||||||||||||||||
Total | 350,217 | 0 | 350,217 | |||||||||||||||||||||
Total Preferred Stock (Cost $119,819, Cost $0, Combined $119,819) | 350,217 | 0 | 350,217 | |||||||||||||||||||||
Collateral Held for Securities Loaned (0.2%) | ||||||||||||||||||||||||
Thrivent Cash Management Trust | 0 | 3,542,000 | 3,542,000 | 0 | 3,542,000 | 3,542,000 | ||||||||||||||||||
Total Collateral Held for Securities Loaned (Cost $3,542,000, Cost $0, Combined $3,542,000) | 0 | 3,542,000 | 3,542,000 | |||||||||||||||||||||
Short-Term Investments (1.2%) | ||||||||||||||||||||||||
Thrivent Core Short-Term Reserve Fund 1.97% | 82,701 | 2,043,432 | 2,126,133 | 827,012 | 20,434,325 | 21,261,337 | ||||||||||||||||||
Total Short-Term Investments (Cost $827,012, Cost $20,434,325, Combined $21,261,337) | 827,012 | 20,434,325 | 21,261,337 | |||||||||||||||||||||
Total Investments (Cost $151,346,384, Cost $924,239,885, Combined $1,075,586,269) 100.4% | $266,848,604 | $1,493,294,735 | $1,760,143,339 | |||||||||||||||||||||
Other Assets and Liabilities, Net (0.4%) | (141,874 | ) | (6,897,156 | ) | (7,039,030 | ) | ||||||||||||||||||
Total Net Assets 100.0% | $ 266,706,730 | $ 1,486,397,579 | $ 1,753,104,309 |
(a) Non-income producing security.
(b) All or a portion of the security is on loan.
(c) Security is valued using significant unobservable inputs. Further information on valuation can be found in the Notes to Financial Statements.
(d) It is currently anticipated that the security, or a portion of the security, may be disposed of for the Reorganization. Actual portfolio sales will depend on portfolio composition, market conditions and other factors at the time of the Reorganization and will be at the discretion of the Portfolio Manager of the Advisor.
The following table presents the total amount of securities loaned with continuous maturity, by type, offset by the gross payable upon return of collateral for securities loaned by Thrivent Large Cap Growth Portfolio as of December 31, 2019:
Securities Lending Transactions | ||||
Common Stock | $3,503,360 | |||
Total lending | $3,503,360 | |||
Gross amount payable upon return of collateral for securities loaned | $3,542,000 | |||
Net amounts due to counterparty | $38,640 |
Definitions:
ADR - American Depositary Receipt, which are certificates for an underlying foreign security’s shares held by an issuing U.S. depository bank.
GDR - Global Depository Receipts, which are certificates for shares of an underlying foreign security’s shares held by an issuing depository bank from more than one country.
Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and depreciation of investments of the portfolio as a whole (including derivatives), based on cost for federal income tax purposes, were as follows:
Partner Growth Stock Portfolio | Large Cap Growth Portfolio | Combined Pro Forma (assuming merger with Target Portfolio) | ||||||||||
Gross unrealized appreciation | $ | 116,157,556 | $ | 569,735,428 | $ | 685,892,984 | ||||||
Gross unrealized depreciation | (1,258,230 | ) | (2,372,561 | ) | (3,630,791 | ) | ||||||
Net unrealized appreciation (depreciation) | $ | 114,899,326 | $ | 567,362,867 | $ | 682,262,193 | ||||||
Cost for federal income tax purposes | $ | 151,949,278 | $ | 925,931,868 | $ | 1,077,881,146 |
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Fair Valuation Measurements
The following table is a summary of the inputs used, as of December 31, 2019, in valuing Partner Growth Stock Portfolio’s assets carried at fair value.
Investments in Securities | Partner Growth Stock Portfolio Total | Partner Growth Stock Portfolio Level 1 | Partner Growth Stock Portfolio Level 2 | Partner Growth Stock Portfolio Level 3 | ||||||||||||
Common Stock | ||||||||||||||||
Communications Services | 44,878,483 | 40,388,465 | 4,490,018 | — | ||||||||||||
Consumer Discretionary | 58,309,588 | 56,312,571 | 1,997,017 | — | ||||||||||||
Consumer Staples | 1,460,230 | 1,460,230 | — | — | ||||||||||||
Energy | 1,856,309 | 1,856,309 | — | — | ||||||||||||
Financials | 4,850,524 | 4,850,524 | — | — | ||||||||||||
Health Care | 33,106,278 | 31,821,873 | 1,284,405 | — | ||||||||||||
Industrials | 24,612,407 | 24,612,407 | — | — | ||||||||||||
Information Technology | 92,711,051 | 89,958,384 | 2,752,667 | — | ||||||||||||
Utilities | 3,886,505 | 3,886,505 | — | — | ||||||||||||
Preferred Stock | ||||||||||||||||
Consumer Discretionary | 350,217 | — | — | 350,217 | ||||||||||||
Subtotal Investments in Securities | $ | 266,021,592 | $ | 255,147,268 | $ | 10,524,107 | $ | 350,217 | ||||||||
Other Investments * | Total | |||||||||||||||
Affiliated Short-Term Investments | 827,012 | |||||||||||||||
| ||||||||||||||||
Subtotal Other Investments | $ | 827,012 | ||||||||||||||
| ||||||||||||||||
| ||||||||||||||||
Total Investments at Value | $ | 266,848,604 | ||||||||||||||
|
* | Certain investments are measured at fair value using a net asset value per share that is not publicly available (practical expedient). According to disclosure requirements of Accounting Standards Codification (ASC) 820, Fair Value Measurement, securities valued using the practical expedient are not classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statement of Assets and Liabilities. |
Fair Valuation Measurements
The following table is a summary of the inputs used, as of December 31, 2019, in valuing Large Cap Growth Portfolio’s assets carried at fair value.
Investments in Securities | Large Cap Growth Portfolio Total | Large Cap Growth Portfolio Level 1 | Large Cap Growth Portfolio Level 2 | Large Cap Growth Portfolio Level 3 | ||||||||||||
Common Stock | ||||||||||||||||
Communications Services | 194,231,344 | 194,231,344 | — | — | ||||||||||||
Consumer Discretionary | 269,476,639 | 269,476,639 | — | — | ||||||||||||
Consumer Staples | 40,243,252 | 40,243,252 | — | — | ||||||||||||
Financials | 81,494,936 | 81,494,936 | — | — | ||||||||||||
Health Care | 199,528,099 | 199,528,099 | — | — | ||||||||||||
Industrials | 81,703,617 | 81,703,617 | — | — | ||||||||||||
Information Technology | 562,350,332 | 562,350,332 | — | — | ||||||||||||
Materials | 18,296,417 | 18,296,417 | — | — | ||||||||||||
Real Estate | 21,993,774 | 21,993,774 | — | — | ||||||||||||
Subtotal Investments in Securities | $ | 1,469,318,410 | $ | 1,469,318,410 | $ | — | $ | — | ||||||||
Other Investments * | Total | |||||||||||||||
Affiliated Short-Term Investments | 20,434,325 | |||||||||||||||
Collateral Held for Securities Loaned | 3,542,000 | |||||||||||||||
| ||||||||||||||||
Subtotal Other Investments | $ | 23,976,325 | ||||||||||||||
| ||||||||||||||||
| ||||||||||||||||
Total Investments at Value | $ | 1,493,294,735 | ||||||||||||||
|
* | Certain investments are measured at fair value using a net asset value per share that is not publicly available (practical expedient). According to disclosure requirements of Accounting Standards Codification (ASC) 820, Fair Value Measurement, securities valued using the practical expedient are not classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statement of Assets and Liabilities. |
Fair Valuation Measurements
The following table is a summary of the inputs used, as of December 31, 2019, in valuing the combined assets carried at fair value.
Investments in Securities | Combined Pro Forma Total | Combined Pro Forma Level 1 | Combined Pro Forma Level 2 | Combined Pro Forma Level 3 | ||||||||||||
Common Stock | ||||||||||||||||
Communications Services | 239,109,827 | 234,619,809 | 4,490,018 | — | ||||||||||||
Consumer Discretionary | 327,786,227 | 325,789,210 | 1,997,017 | — | ||||||||||||
Consumer Staples | 41,703,482 | 41,703,482 | — | — | ||||||||||||
Energy | 1,856,309 | 1,856,309 | — | — | ||||||||||||
Financials | 86,345,460 | 86,345,460 | — | — | ||||||||||||
Health Care | 232,634,377 | 231,349,972 | 1,284,405 | — | ||||||||||||
Industrials | 106,316,024 | 106,316,024 | — | — | ||||||||||||
Information Technology | 655,061,383 | 652,308,716 | 2,752,667 | — | ||||||||||||
Materials | 18,296,417 | 18,296,417 | — | — | ||||||||||||
Real Estate | 21,993,774 | 21,993,774 | — | — | ||||||||||||
Utilities | 3,886,505 | 3,886,505 | — | — | ||||||||||||
Preferred Stock | ||||||||||||||||
Consumer Discretionary | 350,217 | — | — | 350,217 | ||||||||||||
Subtotal Investments in Securities | $ | 1,735,340,002 | $ | 1,724,465,678 | $ | 10,524,107 | $ | 350,217 | ||||||||
Other Investments * | Total | |||||||||||||||
Affiliated Short-Term Investments | 21,261,337 | |||||||||||||||
Collateral Held for Securities Loaned | 3,542,000 | |||||||||||||||
| ||||||||||||||||
Subtotal Other Investments | $ | 24,803,337 | ||||||||||||||
| ||||||||||||||||
| ||||||||||||||||
Total Investments at Value | $ | 1,760,143,339 | ||||||||||||||
|
* | Certain investments are measured at fair value using a net asset value per share that is not publicly available (practical expedient). According to disclosure requirements of Accounting Standards Codification (ASC) 820, Fair Value Measurement, securities valued using the practical expedient are not classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statement of Assets and Liabilities. |
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Investment in Affiliates
Affiliated issuers, as defined under the Investment Company Act of 1940, include those in which the Portfolio’s holdings of an issuer represent 5% or more of the outstanding voting securities of an issuer, any affiliated mutual fund, or a company which is under common ownership or control with the Portfolio. The Portfolio owns shares of Thrivent Cash Management Trust for the purpose of securities lending and Thrivent Core Short-Term Reserve Fund, a series of Thrivent Core Funds, primarily to serve as a cash sweep vehicle for the Portfolio. Thrivent Cash Management Trust and Thrivent Core Funds are established solely for investment by Thrivent entities.
A summary of transactions (in thousands; values shown as zero are less than $500) for the fiscal year to date, in Partner Growth Stock Portfolio, is as follows:
Portfolio | Value 12/31/2018 | Gross Purchases | Gross Sales | Value 12/31/2019 | Shares Held at 12/31/2019 | % of Net Assets 12/31/2019 | ||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | 821 | $ | 37,158 | $ | 37,152 | $ | 827 | 83 | 0.3 | % | |||||||||||||
Total Affiliated Short-Term Investments | 821 | 827 | 0.3 | |||||||||||||||||||||
Collateral held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | 3,645 | 10,169 | 13,814 | — | — | — | ||||||||||||||||||
Total Collateral Held for Securities Loaned | 3,645 | — | — | |||||||||||||||||||||
Total Value | $ | 4,466 | $ | 827 | ||||||||||||||||||||
Portfolio | Net Realized Gain/(Loss) | Change in Unrealized Appreciation/ (Depreciation) | Distributions of Realized Capital Gains | Income Earned 1/1/2019 - 12/31/2019 | ||||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | — | $ | — | 0 | $ | 67 | |||||||||||||||||
Total Income/Non Income Cash from Affiliated Investments | $ | 67 | ||||||||||||||||||||||
Collateral Held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | — | — | — | 1 | ||||||||||||||||||||
Total Affiliated Income from Securities Loaned, Net | $ | 1 | ||||||||||||||||||||||
Total Value | $ | — | $ | — | $ | 0 |
Investment in Affiliates
Affiliated issuers, as defined under the Investment Company Act of 1940, include those in which the Portfolio’s holdings of an issuer represent 5% or more of the outstanding voting securities of an issuer, any affiliated mutual fund, or a company which is under common ownership or control with the Portfolio. The Portfolio owns shares of Thrivent Cash Management Trust for the purpose of securities lending and Thrivent Core Short-Term Reserve Fund, a series of Thrivent Core Funds, primarily to serve as a cash sweep vehicle for the Portfolio. Thrivent Cash Management Trust and Thrivent Core Funds are established solely for investment by Thrivent entities.
A summary of transactions (in thousands; values shown as zero are less than $500) for the fiscal year to date, in Large Cap Growth Portfolio, is as follows:
Portfolio | Value 12/31/2018 | Gross Purchases | Gross Sales | Value 12/31/2019 | Shares Held at 12/31/2019 | % of Net Assets 12/31/2019 | ||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | 11,249 | $ | 154,842 | $ | 145,657 | $ | 20,434 | 2,043 | 1.4 | % | |||||||||||||
Total Affiliated Short-Term Investments | 11,249 | 20,434 | 1.4 | |||||||||||||||||||||
Collateral held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | — | 15,935 | 12,393 | 3,542 | 3,542 | 0.2 | ||||||||||||||||||
Total Collateral Held for Securities Loaned | — | 3,542 | 0.2 | |||||||||||||||||||||
Total Value | $ | 11,249 | $ | 23,976 | ||||||||||||||||||||
Portfolio | Net Realized Gain/(Loss) | Change in Unrealized Appreciation/ (Depreciation) | Distributions of Realized Capital Gains | Income Earned 1/1/2019 - 12/31/2019 | ||||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | — | $ | — | 0 | $ | 520 | |||||||||||||||||
Total Income/Non Income Cash from Affiliated Investments | $ | 520 | ||||||||||||||||||||||
Collateral Held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | — | — | — | 5 | ||||||||||||||||||||
Total Affiliated Income from Securities Loaned, Net | $ | 5 | ||||||||||||||||||||||
Total Value | $ | — | $ | — | $ | 0 |
Investment in Affiliates
Affiliated issuers, as defined under the Investment Company Act of 1940, include those in which the Portfolio’s holdings of an issuer represent 5% or more of the outstanding voting securities of an issuer, any affiliated mutual fund, or a company which is under common ownership or control with the Portfolio. The Portfolio owns shares of Thrivent Cash Management Trust for the purpose of securities lending and Thrivent Core Short-Term Reserve Fund, a series of Thrivent Core Funds, primarily to serve as a cash sweep vehicle for the Portfolio. Thrivent Cash Management Trust and Thrivent Core Funds are established solely for investment by Thrivent entities.
A summary of transactions (in thousands; values shown as zero are less than $500) for the fiscal year to date, as a combined pro forma, is as follows:
Portfolio | Value 12/31/2018 | Gross Purchases | Gross Sales | Value 12/31/2019 | Shares Held at 12/31/2019 | % of Net Assets 12/31/2019 | ||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | 12,070 | $ | 192,000 | $ | 182,809 | $ | 21,261 | $ | 2,126 | 1.2 | % | ||||||||||||
Total Affiliated Short-Term Investments | 12,070 | 21,261 | 1.2 | |||||||||||||||||||||
Collateral held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | 3,645 | 26,104 | 26,207 | 3,542 | 3,542 | 0.2 | ||||||||||||||||||
Total Collateral Held for Securities Loaned | �� | 3,645 | 3,542 | 0.2 | ||||||||||||||||||||
Total Value | $ | 11,249 | $ | 24,803 | ||||||||||||||||||||
Portfolio | Net Realized Gain/(Loss) | Change in Unrealized Appreciation/ (Depreciation) | Distributions of Realized Capital Gains | Income Earned 1/1/2019 - 12/31/2019 | ||||||||||||||||||||
Affiliated Short-Term Investments | ||||||||||||||||||||||||
Core Short-Term Reserve, 1.970% | $ | — | $ | — | 0 | $ | 587 | |||||||||||||||||
Total Income/Non Income Cash from Affiliated Investments | $ | 587 | ||||||||||||||||||||||
Collateral Held for Securities Loaned | ||||||||||||||||||||||||
Cash Management Trust-Collateral Investment | — | — | — | 6 | ||||||||||||||||||||
Total Affiliated Income from Securities Loaned, Net | $ | 6 | ||||||||||||||||||||||
Total Value | $ | — | $ | — | $ | 0 |
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Notes to Pro Forma Financial Statements (Unaudited)
(1) REORGANIZATION
The unaudited pro forma information has been prepared to give effect to the proposed reorganization of Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”) into Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”) pursuant to an Agreement and Plan of Reorganization (the “Reorganization”).
Under the Reorganization Agreement, the Target Portfolio will transfer all of its assets to the Acquiring Portfolio in exchange for shares of the Acquiring Portfolio. The Acquiring Portfolio shares issued to the Target Portfolio will have an aggregate value equal to the aggregate value of the Target Portfolio’s net assets immediately prior to the Reorganization. Upon receipt by the Target Portfolio of Acquiring Portfolio shares, the Target Portfolio will distribute such shares of the Acquiring Portfolio to Target Portfolio shareholders. Then, as soon as practicable after the Closing Date of the Reorganization, the Target Portfolio will dissolve under applicable state law. The Acquiring Portfolio anticipates selling approximately 47% of the market value of the Target Portfolio’s investments after the Reorganization. As of May 29, 2020, the Target Portfolio’s investments that the Acquiring Portfolio would anticipate selling have a market value of $130,403,977.46.
The Target Portfolio will distribute the Acquiring Portfolio shares received by it pro rata to Target Portfolio shareholders of record in exchange for their interest in shares of the Target Portfolio. Accordingly, as a result of the Reorganization, each Target Portfolio shareholder would own Acquiring Portfolio shares that would have an aggregate value immediately after the Reorganization equal to the aggregate value of that shareholder’s Target Portfolio shares immediately prior to the Reorganization. The interests of each of the Target Portfolio’s shareholders will not be diluted as a result of the Reorganization. However, as a result of the Reorganization, a shareholder of the Target Portfolio or the Acquiring Portfolio will hold a reduced percentage of ownership in the larger combined portfolio than the shareholder did in either of the separate Portfolios.
The Acquiring Portfolio will be the accounting survivor of the Reorganization.
(2) BASIS OF PRO FORMA FINANCIAL STATEMENTS
The pro forma financial information gives effect to the proposed reorganization whereby all of the assets of the Target Portfolio would be transferred to the Acquiring Portfolio in exchange for Shares of the Acquiring Portfolio. Under U.S. generally accepted accounting principles, the historical cost of investment securities will be applied to the surviving entity (i.e., the Acquiring Portfolio).
The unaudited pro forma combined statement of assets and liabilities and schedule of investments assumes that the Reorganization occurred on December 31, 2019, and the unaudited pro forma combined statement of operations, for the year ended December 31, 2019, presents the results of operations of the Acquiring Portfolio as if the Reorganization had occurred on the first business day following the year ended December 31, 2018. The pro forma results of operations are not necessarily indicative of actual future results of operations. The pro forma statements of asset and liabilities and schedule of investments have been derived from the books and records of the Target Portfolio and Acquiring Portfolio utilized in calculating net asset values at December 31, 2019. The pro forma statements of operations for the year ended December 31, 2019 have been derived from the books and records of each Target Portfolio and Acquiring Portfolio for the year ended December 31, 2019. The accompanying pro forma financial statements and notes to the pro forma financial statements should be read in conjunction with the December 31, 2019 annual report of the Target Portfolio and the Acquiring Portfolio.
(3) PRO FORMA EXPENSE ADJUSTMENTS
Management of the Portfolios estimates the total cost of the Reorganization to be approximately $80,000. If the Reorganization is not approved by contract holders, the Adviser will still bear the costs of the proposed Reorganization within the pro-forma financials.
Any brokerage charges associated with the purchase or disposition of portfolio investments by the Target Portfolio prior to the Reorganization will be borne by the Target Portfolio. Any brokerage charges associated with the purchase or disposition of
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portfolio investments by the Acquiring Portfolio after the Reorganization will be borne by the Acquiring Portfolio. These brokerage costs are estimated to be $70,250, which is less than one basis point of the Target Portfolio and the Acquiring Portfolio net assets as of May 29, 2020. The Pro Forma Statement of Operations does not include the effect of any realized gains or losses, or transaction fees incurred in connection with the realignment of the Acquiring Portfolio.
(4) CAPITALIZATION
The following table sets forth the capitalization of the Target Portfolio and the Acquiring Portfolio, as of May 29, 2020, and the pro forma capitalization of the Acquiring Portfolio as if the Reorganization occurred on that date. These numbers may differ as of the Closing Date. Please note that the adjusted shares outstanding in the pro forma statement of assets and liabilities of 6,517,871, is based on December 31, 2019 and will differ from the table below.
Partner Growth Stock Target Portfolio | Large Cap Growth Portfolio Acquiring Portfolio | Pro Forma Acquiring Portfolio | ||||||||||
Net assets | $279,453,778 | $1,637,409,818 | $1,916,863,595 | |||||||||
Net asset value per share | $29.62 | $45.07 | $45.07 | |||||||||
Shares outstanding | 9,434,991 | 36,329,407 | 42,529,681 |
The pro forma shares outstanding reflect the issuance by the Acquiring Portfolio of approximately 6,200,274 shares. Such issuance reflects the exchange of the assets of the Target Portfolio for newly issued shares of the Acquiring Portfolio at the pro forma net asset value per share. The aggregate value of the Acquiring Portfolio shares that a Target Portfolio shareholder receives in the Reorganization will equal the aggregate value of the Target Portfolio shares owned immediately prior to the Reorganization.
(5) SIGNIFICANT ACCOUNTING POLICIES
Valuation of Investments — Securities traded on U.S. or foreign securities exchanges or included in a national market system are valued at the last sale price on the principal exchange as of the close of regular trading on such exchange or the official closing price of the national market system. Over-the-counter securities and listed securities for which no price is readily available are valued at the current bid price considered best to represent the value at that time. Security prices are based on quotes that are obtained from an independent pricing service approved by the Fund’s Board of Directors (the “Board”). The pricing service, in determining values of fixed-income securities, takes into consideration such factors as current quotations by broker/dealers, coupon, maturity, quality, type of issue, trading characteristics, and other yield and risk factors it deems relevant in determining valuations. Securities which cannot be valued by the approved pricing service are valued using valuations from dealers that make markets in the securities. Exchange-listed options and futures contracts are valued at the primary exchange settle price. Exchange cleared swap agreements are valued using the clearinghouse end of day price. Swap agreements not cleared on exchanges will be valued using the mid-price from the primary approved pricing service. Forward foreign currency exchange contracts are marked-to-market based upon foreign currency exchange rates provided by the pricing service. Investments in open-ended mutual funds are valued at their net asset value at the close of each business day.
The Board has delegated responsibility for daily valuation of the Portfolios’ securities to the Portfolios’ Investment Adviser. The Adviser has formed a Valuation Committee (“Committee”) that is responsible for overseeing the Portfolios’ valuation policies in accordance with Valuation Policies and Procedures. The Committee meets on a monthly and on an as-needed basis to review price challenges, price overrides, stale prices, shadow prices, manual prices, money market pricing, international fair valuation, and other securities requiring fair valuation.
The Committee monitors for significant events occurring prior to the close of trading on the New York Stock Exchange that could have a material impact on the value of any securities that are held by the Portfolios. Examples of such events include trading halts, national news/events, and issuer-specific developments. If the Committee decides that such events warrant using fair value estimates, the Committee will take such events into consideration in determining the fair value of such securities. If market quotations or prices are not readily available or determined to be unreliable, the securities will be valued at fair value as determined in good faith pursuant to procedures adopted by the Board.
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In accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), the various inputs used to determine the fair value of the Portfolios’ investments are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities, typically included in this level are U.S. equity securities, futures, options and registered investment company funds. Level 2 includes other significant observable inputs such as quoted prices for similar securities, interest rates, prepayment speeds and credit risk, typically included in this level are fixed income securities, international securities, swaps and forward contracts. Level 3 includes significant unobservable inputs such as the Adviser’s own assumptions and broker evaluations in determining the fair value of investments. The valuation levels are not necessarily an indication of the risk associated with investing in these securities or other investments. Investments measured using net asset value per share as a practical expedient for fair value and that are not publicly available-for-sale are not categorized within the fair value hierarchy.
Valuation of International Securities — The Portfolios value certain foreign securities traded on foreign exchanges that close prior to the close of the New York Stock Exchange using a fair value pricing service. The fair value pricing service uses a multi-factor model that may take into account the local close, relevant general and sector indices, currency fluctuation, prices of other securities (including ADRs, New York registered shares, and ETFs), and futures, as applicable, to determine price adjustments for each security in order to reflect the effects of post-closing events. The Board has authorized the Adviser to make fair valuation determinations pursuant to policies approved by the Board.
Foreign Currency Translation — The accounting records of each Portfolio are maintained in U.S. dollars. Securities and other assets and liabilities that are denominated in foreign currencies are translated into U.S. dollars at the daily closing rates of exchange.
Foreign currency amounts related to the purchase or sale of securities and income and expenses are translated at the exchange rate on the transaction date. Net realized and unrealized currency gains and losses are recorded from closed currency contracts, disposition of foreign currencies, exchange gains or losses between the trade date and settlement date on securities transactions, and other translation gains or losses on dividends, interest income and foreign withholding taxes. The Portfolios do not separately report the effect of changes in foreign exchange rates from changes in prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments in the Statement of Operations.
For federal income tax purposes, the Portfolios treat the effect of changes in foreign exchange rates arising from actual foreign currency transactions and the changes in foreign exchange rates between the trade date and settlement date as ordinary income.
Contingent Liabilities — In the event of adversary action proceedings where the Portfolio is a defendant, the loss contingency will not be accrued as a liability until the amount of potential damages and the likelihood of loss can be reasonably estimated.
Federal Income Taxes — No provision has been made for income taxes because each Portfolio’s policy is to qualify as a regulated investment company under the Internal Revenue Code and distribute substantially all investment company taxable income and net capital gain on a timely basis. It is also the intention of each Portfolio to distribute an amount sufficient to avoid imposition of any federal excise tax. The Portfolios, accordingly, anticipate paying no federal taxes and no federal tax provision was recorded. Each Portfolio is treated as a separate taxable entity for federal income tax purposes. The Portfolios may utilize earnings and profits distributed to shareholders on the redemption of shares as part of the dividends paid deduction.
GAAP requires management of the Portfolios (i.e., the Adviser) to make additional tax disclosures with respect to the tax effects of certain income tax positions, whether those positions were taken on previously filed tax returns or are expected to be taken on future returns. These positions must meet a “more likely than not” standard that, based on the technical merits of the position, it would have a greater than 50 percent likelihood of being sustained upon examination. In evaluating whether a tax position has met the more-likely-than-not recognition threshold, the Adviser must presume that the position will be examined by the appropriate taxing authority that has full knowledge of all relevant information.
The Adviser analyzed all open tax years, as defined by the statute of limitations, for all major jurisdictions. Open tax years are those that are open for examination by taxing authorities. Major jurisdictions for the Portfolios include U.S. Federal, Minnesota, and Wisconsin, as well as certain foreign countries. As of December 31, 2019, open U.S. Federal, Minnesota, and Wisconsin tax years include the tax years ended December 31, 2016 through 2019. Additionally, as of December 31, 2019, the tax year ended December 31, 2015 is open for Wisconsin. The Portfolios have no examinations in progress and none are expected at this time.
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As of December 31, 2019, the Adviser has reviewed all open tax years and major jurisdictions and concluded that there is no effect to the Portfolios’ tax liability, financial position or results of operations. There is no tax liability resulting from unrecognized tax benefits related to uncertain income tax positions taken or expected to be taken in future tax returns. The Portfolios are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next 12 months.
Immediately prior to the Reorganization, the Target Portfolio is not expected to have any unutilized capital loss carryforwards. The final amount of unutilized capital loss carryforwards for the Target Portfolio is subject to change and will not be determined until the Closing Date. As of May 29, 2020, the capital loss carryforward of the Target Portfolio and the Acquiring Portfolio was $0 and $0, respectively.
Generally, the Acquiring Portfolio will succeed to the capital loss carryforwards of the Target Portfolio. If the Target Portfolio has capital loss carryforwards, such capital losses would, in the absence of the Reorganization, generally be available to offset Target Portfolio capital gains, thereby reducing the amount of capital gain net income that must be distributed to the Target Portfolio shareholders.
Foreign Income Taxes — Portfolios are subject to foreign income taxes imposed by certain countries in which they invest. Withholding taxes on foreign dividends have been provided for in accordance with the applicable country’s tax rules and rates. These amounts are shown as foreign dividend tax withholding in the Statement of Operations. The Portfolios pay tax on foreign capital gains, where applicable.
(6) TAX INFORMATION
Distributions are based on amounts calculated in accordance with applicable federal income tax regulations, which may differ from GAAP. The differences between book-basis and tax-basis distributable earnings are primarily attributable to timing differences in recognizing losses deferred on wash sales. At the end of the fiscal year, reclassifications between net asset accounts are made for differences that are permanent in nature. These permanent differences primarily relate to the tax treatment of foreign currency, short-term gain distributions from underlying funds, and real estate investment trusts. The Portfolios had no reclassification adjustments on the Statement of Assets and Liabilities as a result of permanent book-to-tax adjustments.
At December 31, 2019, the components of distributable earnings on a tax basis were as follows:
Portfolio | Undistributed Ordinary Income# | Undistributed Long-Term Capital Gain | ||||||
Large Cap Growth | 5,369,056 | 98,493,157 | ||||||
Partner Growth Stock | 145,738 | 4,055,053 |
# | Undistributed ordinary income includes income derived from short-term capital gains. |
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FORM OF AGREEMENT AND PLAN OF REORGANIZATION
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AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the “Agreement”) is made as of _______, 2020 by Thrivent Series Fund, Inc. (the “Fund”), a Minnesota corporation, on behalf of its series, Thrivent Large Cap Growth Portfolio (the “Acquiring Portfolio”) and Thrivent Partner Growth Stock Portfolio (the “Target Portfolio”). Thrivent Financial for Lutherans is also party to the Agreement solely for purposes of Section 3.F.
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Fund, on behalf of each of the Acquiring Portfolio and the Target Portfolio, has determined that entering into this Agreement whereby the Target Portfolio would transfer all of its assets to the Acquiring Portfolio in exchange for shares of the Acquiring Portfolio, is in the best interests of the shareholders of their respective Fund; and
WHEREAS, the parties intend that this transaction qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”);
NOW, THEREFORE, in consideration of the mutual promises contained herein, and intending to be legally bound hereby, the parties hereto agree as follows:
1. | Plan of Transaction. |
A. Transfer of Assets. Upon satisfaction of the conditions precedent set forth in Sections 7 and 8 hereof, the Target Portfolio will convey, transfer and deliver to the Acquiring Portfolio at the closing, provided for in Section 2 hereof, all of the existing assets of the Target Portfolio (including accrued interest to the Closing Date) (as defined below), free and clear of all liens, encumbrances and claims whatsoever (the assets so transferred collectively being referred to as the “Assets”).
B. Consideration. In consideration thereof, the Acquiring Portfolio agrees that the Acquiring Portfolio at the closing will deliver to the Target Portfolio, full and fractional shares of beneficial interest, par value $0.01 per share, of the Acquiring Portfolio having net asset values per share calculated as provided in Section 3(A) hereof, in an amount equal to the aggregate dollar value of the Assets determined pursuant to Section 3(A) hereof net of any liabilities of the Target Portfolio described in Section 3(E) hereof (the “Liabilities”) (collectively, the “Acquiring Portfolio Shares”). The calculation of full and fractional Acquiring Portfolio Shares to be exchanged shall be carried out to no less than two (2) decimal places. All Acquiring Portfolio Shares delivered to the Target Portfolio in exchange for such Assets shall be delivered at net asset value without sales load, commission or other transactional fees being imposed.
2. | Closing of the Transaction. |
A. Closing Date. The closing shall occur within thirty (30) business days after the later of the receipt of all necessary regulatory approvals and the final adjournment of the meeting of shareholders of the Target Portfolio at which this Agreement will be considered and approved, or such later date as soon as practicable thereafter, as the parties may mutually agree (the “Closing Date”). On the Closing Date, the Acquiring Portfolio shall deliver to the Target Portfolio the Acquiring Portfolio Shares in the amount determined pursuant to Section 1(B) hereof and the Target Portfolio thereafter shall, in order to effect the distribution of such shares to the Target Portfolio shareholders, instruct the Acquiring Portfolio to register the pro rata interest in the Acquiring Portfolio Shares (in full and fractional shares) of each of the holders of record of shares of the Target Portfolio in accordance with their holdings of shares of the Target Portfolio and shall provide as part of such instruction a complete and updated list of such holders (including addresses and taxpayer identification numbers), and the Acquiring Portfolio agrees promptly to comply with said instruction. The Acquiring Portfolio shall have no obligation to inquire as to the validity, propriety or correctness of such instruction, but shall assume that such instruction is valid, proper and correct.
3. | Procedure for Reorganization. |
A. Valuation. The value of the Assets of the Target Portfolio to be transferred by the Acquiring Portfolio shall be computed as of the Closing Date, in the manner set forth in the most recent Prospectus and Statement of Additional Information of the Acquiring Portfolio (collectively, the “Acquiring Portfolio Prospectus”), copies of which have been delivered to the Target Portfolio.
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B. Delivery of Portfolio Assets. The Assets shall be delivered to State Street Bank and Trust Company as Custodian for the Acquiring Portfolio or such other custodian as designated by the Acquiring Portfolio (collectively the “Custodian”) for the benefit of the Acquiring Portfolio, duly endorsed in proper form for transfer in such condition as to constitute a good delivery thereof, free and clear of all liens, encumbrances and claims whatsoever, in accordance with the custom of brokers, and shall be accompanied by all necessary state stock transfer stamps, if any, the cost of which shall be borne by the Target Portfolio and the Acquiring Portfolio, in proportion to their respective declines in total operating expenses, if any.
C. Failure to Deliver Securities. If the Target Portfolio is unable to make delivery pursuant to Section 3(B) hereof to the Custodian of any of the securities of the Target Portfolio for the reason that any such securities purchased by the Target Portfolio have not yet been delivered it by the Target Portfolio’s broker or brokers, then, in lieu of such delivery, the Target Portfolio shall deliver to the Custodian, with respect to said securities, executed copies of an agreement of assignment and due bills executed on behalf of such broker or brokers, together with such other documents as may be required by the Acquiring Portfolio or Custodian, including brokers’ confirmation slips.
D. Shareholder Accounts. The Acquiring Portfolio, in order to assist the Target Portfolio in the distribution of the Acquiring Portfolio Shares to the Target Portfolio shareholders after delivery of the Acquiring Portfolio Shares to the Target Portfolio, will establish pursuant to the request of the Target Portfolio an open account with the Acquiring Portfolio for each shareholder of the Target Portfolio and, upon request by the Target Portfolio, shall transfer to such accounts, the exact number of Acquiring Portfolio Shares then held by the Target Portfolio specified in the instruction provided pursuant to Section 2 hereof.
E. Liabilities. The Liabilities shall include all of the Target Portfolio’s liabilities, debts, obligations, and duties of whatever kind or nature, whether absolute, accrued, contingent, or otherwise, whether or not arising in the ordinary course of business, whether or not determinable at the Closing Date, and whether or not specifically referred to in this Agreement. The Target Portfolio will discharge all of its Liabilities prior to or on the Closing Date.
F. Expenses. In the event that the transactions contemplated herein are consummated, Thrivent Financial for Lutherans (or an affiliate thereof) shall pay the expenses of the Reorganization, including the costs of the special meeting of shareholders of the Target Fund. In addition, as part of the Reorganization, the Target Fund will write off its remaining unamortized organizational expenses, if any, which shall be reimbursed by Thrivent Financial for Lutherans (or an affiliate thereof). The Acquiring Fund shall bear expenses associated with the qualification of shares of the Acquiring Fund for sale in the various states. In addition, to the extent that any transition of Fund securities is required in connection with the Reorganization, the respective Fund may incur transaction expenses associated with the sale and purchase of Fund securities. In the event that the transactions contemplated herein are not consummated for any reason, then all reasonable outside expenses incurred to the date of termination of this Agreement shall be borne by Thrivent Financial for Lutherans (or an affiliate thereof).
G. Dissolution. As soon as practicable after the Closing Date but in no event later than one year after the Closing Date, the Target Portfolio shall voluntarily dissolve and completely liquidate by taking, in accordance with the laws of the State of Minnesota and federal securities laws, all steps as shall be necessary and proper to effect a complete liquidation and dissolution of the Target Portfolio. Immediately after the Closing Date, the share transfer books relating to the Target Portfolio shall be closed and no transfer of shares shall thereafter be made on such books.
4. | Representations and Warranties of the Target Portfolio. |
The Target Portfolio hereby represents and warrants to the Acquiring Portfolio, which representations and warranties are true and correct on the date hereof, and agrees with the Acquiring Portfolio that:
A. Organization. The Fund is a corporation, with transferable shares, duly organized, validly existing and in good standing in conformity with the laws of its jurisdiction of organization. The Target Portfolio is a separate series of the Fund duly organized in accordance with the applicable provisions of the Articles of Incorporation of the Fund, as amended through the date hereof (the “Articles of Incorporation”). The Fund and the Target Portfolio are qualified to do business in all jurisdictions in which it is required to be so qualified, except jurisdictions in which the failure to so qualify would not have a material adverse effect on the Target Portfolio. The Fund and the Target Portfolio have all material federal, state and local authorizations necessary to own all of its properties and assets and to carry on its business as now being conducted, except authorizations which the failure to so obtain would not have a material adverse effect on the Target Portfolio.
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B. Registration. The Fund is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company and such registration has not been revoked or rescinded. The Target Portfolio is in compliance in all material respects with the 1940 Act, and the rules and regulations thereunder with respect to its activities. All of the outstanding common shares of beneficial interest of the Target Portfolio have been duly authorized and are validly issued, fully paid and non-assessable and not subject to pre-emptive or dissenters’ rights.
C. Audited Financial Statements. The statement of assets and liabilities and the portfolio of investments and the related statements of operations and changes in net assets of the Target Portfolio audited as of and for the year ended December 31, 2019, true and complete copies of which have been heretofore furnished to the Acquiring Portfolio, fairly represent the financial condition and the results of operations of the Target Portfolio as of and for their respective dates and periods in conformity with generally accepted accounting principles applied on a consistent basis during the periods involved.
D. Unaudited Financial Statements. The Target Portfolio shall furnish to the Acquiring Portfolio within ten (10) business days after the Closing Date, an unaudited statement of assets and liabilities and the portfolio of investments and the related statements of operations and changes in net assets as of and for the interim period ending on the Closing Date; such financial statements will represent fairly the financial position and portfolio of investments and the results of the Target Portfolio’s operations as of, and for the periods ending on, the dates of such statements in conformity with generally accepted accounting principles applied on a consistent basis during the periods involved and the results of its operations and changes in financial position for the period then ended; and such financial statements shall be certified by the Treasurer of the Target Portfolio as complying with the requirements hereof.
E. Contingent Liabilities. There are, and as of the Closing Date will be, no contingent liabilities of the Target Portfolio not discharged pursuant to Section 3(E), and there are no legal, administrative, or other proceedings pending or, to its knowledge, threatened against the Target Portfolio which would, if adversely determined, materially affect the Target Portfolio’s financial condition. All liabilities were incurred by the Target Portfolio in the ordinary course of its business.
F. Material Agreements. The Target Portfolio is in compliance with all material agreements, rules, laws, statutes, regulations and administrative orders affecting its operations or its assets; and except as referred to in the most recent Prospectus and Statement of Additional Information of the Target Portfolio (collectively, the “Target Portfolio Prospectus”), there are no material agreements outstanding relating to the Target Portfolio to which the Target Portfolio is a party.
G. Statement of Earnings. As promptly as practicable, but in any case no later than 30 calendar days after the Closing Date, the Target Portfolio shall furnish the Acquiring Portfolio with a statement of the earnings and profits of the Target Portfolio within the meaning of the Code as of the Closing Date.
H. Tax Returns. At the date hereof and on the Closing Date, all federal and other material tax returns and reports of the Target Portfolio required by law to have been filed by such dates shall have been filed, and all federal and other taxes shown thereon shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the best of the Target Portfolio’s knowledge no such return is currently under audit and no assessment has been asserted with respect to any such return.
I. Necessary Authority. The Fund on behalf of the Target Portfolio has the necessary power to enter into this Agreement and to consummate the transactions contemplated herein. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein have been duly authorized by the Board on behalf of the Target Portfolio, and except for obtaining approval of the Target Portfolio shareholders, no other corporate acts or proceedings by the Fund on behalf of the Target Portfolio are necessary to authorize this Agreement and the transactions contemplated herein. This Agreement has been duly executed and delivered by the Fund on behalf of the Target Portfolio and constitutes a valid and binding obligation of the Target Portfolio enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws affecting creditors’ rights generally, or by general principles of equity (regardless of whether enforcement is sought in a proceeding at equity or law).
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J. No Violation, Consents and Approvals. The execution, delivery and performance of this Agreement by the Fund on behalf of the Target Portfolio does not and will not (i) result in a material violation of any provision of the Fund’s or the Target Portfolio’s organizational documents, (ii) violate any statute, law, judgment, writ, decree, order, regulation or rule of any court or governmental authority applicable to the Target Portfolio, (iii) result in a material violation or breach of, or constitute a default under any material contract, indenture, mortgage, loan agreement, note, lease or other instrument or obligation to which the Target Portfolio is subject, or (iv) result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Target Portfolio. Except as have been obtained, (i) no consent, approval, authorization, order or filing with or notice to any court or governmental authority or agency is required for the consummation by the Target Portfolio of the transactions contemplated by this Agreement and (ii) no consent of or notice to any third party or entity is required for the consummation by the Target Portfolio of the transactions contemplated by this Agreement.
K. Absence of Changes. From the date of this Agreement through the Closing Date, there shall not have been:
i. | any change in the business, results of operations, assets, or financial condition or the manner of conducting the business of the Target Portfolio, other than changes in the ordinary course of its business, or any pending or threatened litigation, which has had or may have a material adverse effect on such business, results of operations, assets, financial condition or manner of conducting business; |
ii. | issued by the Target Portfolio any option to purchase or other right to acquire shares of the Target Portfolio to any person other than subscriptions to purchase shares at net asset value in accordance with terms in the Target Portfolio Prospectus; |
iii. | any entering into, amendment or termination of any contract or agreement by the Target Portfolio, except as otherwise contemplated by this Agreement; |
iv. | any indebtedness incurred, other than in the ordinary course of business, by the Target Portfolio for borrowed money or any commitment to borrow money entered into by the Target Portfolio; |
v. | any amendment of the Fund’s or the Target Portfolio’s organizational documents; or |
vi. | any grant or imposition of any lien, claim, charge or encumbrance (other than encumbrances arising in the ordinary course of business with respect to covered options) upon any asset of the Target Portfolio other than a lien for taxes not yet due and payable. |
L. Title. On the Closing Date, the Target Portfolio will have good and marketable title to the Assets, free and clear of all liens, mortgages, pledges, encumbrances, charges, claims and equities whatsoever, other than a lien for taxes not yet due and payable, and full right, power and authority to sell, assign, transfer and deliver such Assets; upon delivery of such Assets, the Acquiring Portfolio will receive good and marketable title to such Assets, free and clear of all liens, mortgages, pledges, encumbrances, charges, claims and equities whatsoever, other than a lien for taxes not yet due and payable.
M. Prospectus/Proxy Statement. The Registration Statement on Form N-14 of the Fund (the “Registration Statement”) and the Prospectus/Proxy Statement contained therein (the “Prospectus/Proxy Statement”), as of the effective date of the Registration Statement, and at all times subsequent thereto up to and including the Closing Date, as amended or as supplemented if it shall have been amended or supplemented, conform and will conform as they relate to the Target Portfolio, in all material respects, to the applicable requirements of the applicable federal and state securities laws and the rules and regulations of the Securities and Exchange Commission (the “SEC”) thereunder, and do not and will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, except that no representations or warranties in this Section 4(M) apply to statements or omissions made in reliance upon and in conformity with written information concerning the Acquiring Portfolio furnished to the Target Portfolio by the Acquiring Portfolio.
N. Tax Qualification. The Target Portfolio has qualified as a regulated investment company within the meaning of Section 851 of the Code for each of its taxable years; and has satisfied the distribution requirements imposed by Section 852 of the Code for each of its taxable years.
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5. | Representations and Warranties of the Acquiring Portfolio. |
The Acquiring Portfolio hereby represents and warrants to the Target Portfolio, which representations and warranties are true and correct on the date hereof, and agrees with the Target Portfolio that:
A. Organization. The Fund is duly formed and in good standing under the laws of the state of its organization and is duly authorized to transact business in the state of its organization. The Acquiring Portfolio is a separate series of the Fund duly organized in accordance with the applicable provisions of the Articles of Incorporation. The Fund and the Acquiring are qualified to do business in all jurisdictions in which it is required to be so qualified, except jurisdictions in which the failure to so qualify would not have a material adverse effect on the Acquiring Portfolio. The Fund and the Acquiring Portfolio have all material federal, state and local authorizations necessary to own all of its properties and assets and to carry on its business and the business thereof as now being conducted, except authorizations which the failure to so obtain would not have a material adverse effect on the Acquiring Portfolio.
B. Registration. The Fund is registered under the 1940 Act as an open-end management investment company and such registration has not been revoked or rescinded. The Acquiring Portfolio is in compliance in all material respects with the 1940 Act, and the rules and regulations thereunder with respect to its activities. All of the outstanding shares of common stock of the Acquiring Portfolio have been duly authorized and are validly issued, fully paid and non-assessable and not subject to pre-emptive or dissenters’ rights.
C. Audited Financial Statements. The statement of assets and liabilities and the portfolio of investments and the related statements of operations and changes in net assets of the Acquiring Portfolio audited as of and for the year ended December 31, 2019, true and complete copies of which have been heretofore furnished to the Target Portfolio, fairly represent the financial condition and the results of operations of the Acquiring Portfolio as of and for their respective dates and periods in conformity with generally accepted accounting principles applied on a consistent basis during the periods involved.
D. Unaudited Financial Statements. The Acquiring Portfolio shall furnish to the Target Portfolio within ten (10) business days after the Closing Date, an unaudited statement of assets and liabilities and the portfolio of investments and the related statements of operations and changes in net assets as of and for the interim period ending on the Closing Date; such financial statements will represent fairly the financial position and portfolio of investments and the results of its operations as of, and for the period ending on, the dates of such statements in conformity with generally accepted accounting principles applied on a consistent basis during the period involved and the results of its operations and changes in financial position for the periods then ended; and such financial statements shall be certified by the Treasurer of the Acquiring Portfolio as complying with the requirements hereof.
E. Contingent Liabilities. There are, and as of the Closing Date will be, no contingent liabilities of the Acquiring Portfolio not disclosed in the financial statements delivered pursuant to Sections 5(C) and 5(D) hereof which would materially affect the Acquiring Portfolio’s financial condition, and there are no legal, administrative, or other proceedings pending or, to its knowledge, threatened against the Acquiring Portfolio which would, if adversely determined, materially affect the Acquiring Portfolio’s financial condition. All liabilities were incurred by the Acquiring Portfolio in the ordinary course of its business.
F. Material Agreements. The Acquiring Portfolio is in compliance with all material agreements, rules, laws, statutes, regulations and administrative orders affecting its operations or its assets; and, except as referred to in the Acquiring Portfolio Prospectus there are no material agreements outstanding relating to the Acquiring Portfolio to which the Acquiring Portfolio is a party.
G. Tax Returns. At the date hereof and on the Closing Date, all federal and other material tax returns and reports of the Acquiring Portfolio required by law to have been filed by such dates shall have been filed, and all federal and other taxes shown thereon shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the best of the Acquiring Portfolio’s knowledge no such return is currently under audit and no assessment has been asserted with respect to any such return.
H. Necessary Authority. The Fund on behalf of the Acquiring Portfolio has the necessary power to enter into this Agreement and to consummate the transactions contemplated herein. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein have been duly authorized by the Board on behalf of the Acquiring Portfolio, no other corporate acts or proceedings by the Acquiring Portfolio are necessary to authorize this Agreement and the transactions contemplated herein. This Agreement has been duly executed and
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delivered by the Fund on behalf of the Acquiring Portfolio and constitutes a valid and binding obligation of the Acquiring Portfolio enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws affecting creditors’ rights generally, or by general principals of equity (regardless of whether enforcement is sought in a proceeding at equity or law).
I. No Violation; Consents and Approvals. The execution, delivery and performance of this Agreement by Fund on behalf of the Acquiring Portfolio does not and will not (i) result in a material violation of any provision of Fund’s or the Acquiring Portfolio’s organizational documents, (ii) violate any statute, law, judgment, writ, decree, order, regulation or rule of any court or governmental authority applicable to the Acquiring Portfolio, (iii) result in a material violation or breach of, or constitute a default under any material contract, indenture, mortgage, loan agreement, note, lease or other instrument or obligation to which the Acquiring Portfolio is subject, or (iv) result in the creation or imposition or any lien, charge or encumbrance upon any property or assets of the Acquiring Portfolio. Except as have been obtained, (i) no consent, approval, authorization, order or filing with or notice to any court or governmental authority or agency is required for the consummation by the Acquiring Portfolio of the transactions contemplated by this Agreement and (ii) no consent of or notice to any third party or entity is required for the consummation by the Acquiring Portfolio of the transactions contemplated by this Agreement.
J. Absence of Proceedings. There are no legal, administrative or other proceedings pending or, to its knowledge, threatened against the Acquiring Portfolio which would materially affect its financial condition.
K. Acquiring Portfolio Shares: Registration. The Acquiring Portfolio Shares to be issued pursuant to Section 1 hereof will be duly registered under the Securities Act of 1933, as amended (the “Securities Act”), and all applicable state securities laws.
L. Acquiring Portfolio Shares: Authorization. The Acquiring Portfolio Shares to be issued pursuant to Section 1 hereof have been duly authorized and, when issued in accordance with this Agreement, will be validly issued, fully paid and non-assessable, will not be subject to pre-emptive or dissenters’ rights and will conform in all material respects to the description thereof contained in the Acquiring Portfolio’s Prospectus furnished to the Target Portfolio.
M. Absence of Changes. From the date hereof through the Closing Date, there shall not have been any change in the business, results of operations, assets or financial condition or the manner of conducting the business of the Acquiring Portfolio, other than changes in the ordinary course of its business, which has had a material adverse effect on such business, results of operations, assets, financial condition or manner of conducting business.
N. Registration Statement. The Registration Statement and the Prospectus/Proxy Statement as of the effective date of the Registration Statement, and at all times subsequent thereto up to and including the Closing Date, as amended or as supplemented if they shall have been amended or supplemented, conforms and will conform, as they relate to the Acquiring Portfolio, in all material respects, to the applicable requirements of the applicable federal securities laws and the rules and regulations of the SEC thereunder, and do not and will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, except that no representations or warranties in this Section 5 apply to statements or omissions made in reliance upon and in conformity with written information concerning the Target Portfolio furnished to the Acquiring Portfolio by the Target Portfolio.
O. Tax Qualification. The Acquiring Portfolio has qualified as a regulated investment company within the meaning of Section 851 of the Code for each of its taxable years; and has satisfied the distribution requirements imposed by Section 852 of the Code for each of its taxable years.
6. Covenants.
During the period from the date of this Agreement and continuing until the Closing Date, the Target Portfolio and Acquiring Portfolio agree as follows (except as expressly contemplated or permitted by this Agreement):
A. Other Actions. The Target Portfolio and Acquiring Portfolio shall operate only in the ordinary course of business consistent with prior practice. No party shall take any action that would, or reasonably would be expected to, result in any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect.
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B. Government Filings; Consents. The Fund shall file all reports required to be filed by the Target Portfolio and Acquiring Portfolio with the SEC between the date of this Agreement and the Closing Date and the Target Portfolio and Acquiring Portfolio shall deliver to the other party copies of all such reports promptly after the same are filed. Except where prohibited by applicable statutes and regulations, each party shall promptly provide the other (or its counsel) with copies of all other filings made by such party with any state, local or federal government agency or entity in connection with this Agreement or the transactions contemplated hereby. Each of the Target Portfolio and the Acquiring Portfolio shall use all reasonable efforts to obtain all consents, approvals and authorizations required in connection with the consummation of the transactions contemplated by this Agreement and to make all necessary filings with the appropriate federal and state officials.
C. Preparation of the Registration Statement and the Prospectus/Proxy Statement. In connection with the Registration Statement and the Prospectus/Proxy Statement, each party hereto will cooperate with the other and furnish to the other the information relating to the Target Portfolio or Acquiring Portfolio, as the case may be, required by the Securities Act or the Securities Exchange Act of 1934 and the rules and regulations thereunder, to be set forth in the Registration Statement or the Prospectus/Proxy Statement. The Target Portfolio shall promptly prepare the Prospectus/Proxy Statement and the Acquiring Portfolio shall promptly prepare and file with the SEC the Registration Statement, in which the Prospectus/Proxy Statement will be included as a prospectus. In connection with the Registration Statement, insofar as it relates to the Target Portfolio and its affiliated persons, the Acquiring Portfolio shall only include such information as is approved by the Target Portfolio for use in the Registration Statement. The Acquiring Portfolio shall not amend or supplement any such information regarding the Target Portfolio and such affiliates without the prior written consent of the Target Portfolio which consent shall not be unreasonably withheld or delayed. The Acquiring Portfolio shall promptly notify and provide the Target Portfolio with copies of all amendments or supplements filed with respect to the Registration Statement. The Acquiring Portfolio shall use all reasonable efforts to have the Registration Statement declared effective under the Securities Act as promptly as practicable after such filing. The Acquiring Portfolio shall also take any action (other than qualifying to do business in any jurisdiction in which it is now not so qualified) required to be taken under any applicable state securities laws in connection with the issuance of the Acquiring Portfolio Shares in the transactions contemplated by this Agreement, and the Target Portfolio shall furnish all information concerning the Target Portfolio and the holders of the Target Portfolio’s shares as may be reasonably requested in connection with any such action.
D. Access to Information. During the period prior to the Closing Date, the Target Portfolio shall make available to the Acquiring Portfolio a copy of each report, schedule, registration statement and other document (the “Documents”) filed or received by it during such period pursuant to the requirements of federal or state securities laws (other than Documents which such party is not permitted to disclose under applicable law). During the period prior to the Closing Date, the Acquiring Portfolio shall make available to the Target Portfolio each Document pertaining to the transactions contemplated hereby filed or received by it during such period pursuant to federal or state securities laws (other than Documents which such party is not permitted to disclose under applicable law).
E. Shareholder Meetings. The Target Portfolio shall call a meeting of the Target Portfolio shareholders to be held as promptly as practicable for the purpose of voting upon the approval of this Agreement and the transactions contemplated herein, and shall furnish a copy of the Prospectus/Proxy Statement and proxy card to each shareholder of the Target Portfolio as of the record date for such meeting of shareholders. The Board shall recommend to the Target Portfolio shareholders approval of this Agreement and the transactions contemplated herein, subject to fiduciary obligations under applicable law.
F. Portfolios. The Target Portfolio and Acquiring Portfolio covenant and agree to dispose of certain assets prior to the Closing Date, but only if and to the extent necessary, so that at Closing, when the Assets are added to the Acquiring Portfolio’s portfolio, the resulting portfolio will meet the Acquiring Portfolio’s investment objective, policies and restrictions, as set forth in the Acquiring Portfolio’s Prospectus, a copy of which has been delivered to the Target Portfolio. Notwithstanding the foregoing, nothing herein will require the Target Portfolio to dispose of any portion of the Assets if, in the reasonable judgment of the Target Portfolio’s Directors or investment adviser, such disposition would create more than an insignificant risk that the Reorganization would not be treated as a “reorganization” described in Section 368(a) of the Code.
G. Distribution of Shares. The Target Portfolio covenants that at closing it shall cause to be distributed the Acquiring Portfolio Shares in the proper pro rata amount for the benefit of Target Portfolio’s shareholders and that the Target Portfolio shall not continue to hold amounts of said shares so as to cause a violation of Section 12(d)(1) of
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the 1940 Act. The Target Portfolio covenants to use all reasonable efforts to cooperate with the Acquiring Portfolio and the Acquiring Portfolio’s transfer agent in the distribution of said shares. The Target Portfolio covenants further that, pursuant to Section 3(G) hereof, it shall liquidate and dissolve as promptly as practicable after the Closing Date.
H. Brokers or Finders. Except as disclosed in writing to the other party prior to the date hereof, each of the Target Portfolio and the Acquiring Portfolio represents that no agent, broker, investment banker, financial advisor or other firm or person is or will be entitled to any broker’s or finder’s fee or any other commission or similar fee in connection with any of the transactions contemplated by this Agreement, and each party shall hold the other harmless from and against any and all claims, liabilities or obligations with respect to any such fees, commissions or expenses asserted by any person to be due or payable in connection with any of the transactions contemplated by this Agreement on the basis of any act or statement alleged to have been made by such first party or its affiliate.
I. Additional Agreements. In case at any time after the Closing Date any further action is necessary or desirable in order to carry out the purposes of this Agreement, the proper directors and officers of each party to this Agreement shall take all such necessary action.
J. Public Announcements. For a period of time from the date of this Agreement to the Closing Date, the Target Portfolio and the Acquiring Portfolio will consult with each other before issuing any press releases or otherwise making any public statements with respect to this Agreement or the transactions contemplated herein and shall not issue any press release or make any public statement prior to such consultation, except as may be required by law.
K. Tax Status of Reorganization. The intention of the parties is that the transactions contemplated by this Agreement will qualify as a reorganization within the meaning of Section 368(a) of the Code. Neither the Acquiring Portfolio nor the Target Portfolio shall take any action, or cause any action to be taken (including, without limitation, the filing of any tax return) that is inconsistent with such treatment or results in the failure of the transaction to qualify as a reorganization within the meaning of Section 368(a) of the Code. At or prior to the Closing Date, the Acquiring Portfolio and the Target Portfolio will take such action, or cause such action to be taken, as is reasonably necessary to enable Reed Smith LLP (“Reed Smith”), special counsel to the Acquiring Portfolio and the Target Portfolio, to render the tax opinion required herein (including, without limitation, each party’s execution of representations reasonably requested by Reed Smith).
L. Declaration of Dividend. At or immediately prior to the Closing Date, the Target Portfolio shall declare and pay to its stockholders a dividend or other distribution in an amount large enough so that it will have distributed substantially all (and in any event not less than 98%) of its investment company taxable income (computed without regard to any deduction for dividends paid) and realized net capital gain, if any, for the current taxable year through the Closing Date.
7. Conditions to Obligations of the Target Portfolio.
The obligations of the Target Portfolio hereunder with respect to the consummation of the Reorganization are subject to the satisfaction of the following conditions, unless waived in writing by the Target Portfolio:
A. Shareholder Approval. This Agreement and the transactions contemplated herein shall have been approved by the affirmative vote of a “Majority of the Outstanding Voting Securities” (as defined in the Articles of Incorporation) of the Target Portfolio.
B. Representations, Warranties and Agreements. Each of the representations and warranties of the Acquiring Portfolio contained herein shall be true in all material respects as of the Closing Date, there shall have been no material adverse change in the financial condition, results of operations, business properties or assets of the Acquiring Portfolio as of the Closing Date, and the Target Portfolio shall have received a certificate of an authorized officer of the Acquiring Portfolio satisfactory in form and substance to the Target Portfolio so stating. The Acquiring Portfolio shall have performed and complied in all material respects with all agreements, obligations and covenants required by this Agreement to be so performed or complied with by it on or prior to the Closing Date.
C. Registration Statement Effective. The Registration Statement shall have become effective and no stop orders under the Securities Act pertaining thereto shall have been issued.
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D. Regulatory Approval. All necessary approvals, registrations, and exemptions under federal and state securities laws shall have been obtained.
E. No Injunctions or Restraints; Illegality. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition (an “Injunction”) preventing the consummation of the transactions contemplated by this Agreement shall be in effect, nor shall any proceeding by any state, local or federal government agency or entity seeking any of the foregoing be pending. There shall not have been any action taken or any statute, rule, regulation or order enacted, entered, enforced or deemed applicable to the transactions contemplated by this Agreement, which makes the consummation of the transactions contemplated by this Agreement illegal or which has a material adverse effect on business operations of the Acquiring Portfolio.
F. Tax Opinion. The Target Portfolio shall have obtained an opinion from Reed Smith, special counsel for the Target Portfolio, dated as of the Closing Date, addressed to the Target Portfolio, that the consummation of the transactions set forth in this Agreement comply with the requirements of a reorganization as described in Section 368(a) of the Code. Such opinion shall be based on customary assumptions and such representations as Reed Smith may reasonably request and the Target Portfolio and the Acquiring Portfolio will cooperate to make and certify the accuracy of such representations.
G. Officer Certificates. The Target Portfolio shall have received a certificate of an authorized officer of the Acquiring Portfolio, dated as of the Closing Date, certifying that the representations and warranties set forth in Section 5 are true and correct on the Closing Date, together with certified copies of the resolutions adopted by the Board on behalf of the Acquiring Portfolio.
8. Conditions to Obligations of the Acquiring Portfolio.
The obligations of the Acquiring Portfolio hereunder with respect to the consummation of the Reorganization are subject to the satisfaction of the following conditions, unless waived in writing by the Acquiring Portfolio:
A. Representations, Warranties, and Agreements. Each of the representations and warranties of the Target Portfolio contained herein shall be true in all material respects as of the Closing Date, there shall have been no material adverse change in the financial condition, results of operations, business, properties or assets of the Target Portfolio as of the Closing Date, and the Acquiring Portfolio shall have received a certificate of an authorized officer of the Target Portfolio satisfactory in form and substance to the Acquiring Portfolio so stating. The Target Portfolio shall have performed and complied in all material respects with all agreements, obligations and covenants required by this Agreement to be so performed or complied with by them on or prior to the Closing Date.
B. Registration Statement Effective. The Registration Statement shall have become effective and no stop orders under the Securities Act pertaining thereto shall have been issued.
C. Regulatory Approval. All necessary approvals, registrations, and exemptions under federal and state securities laws shall have been obtained.
D. No Injunctions or Restrains; Illegality. No Injunction preventing the consummation of the transactions contemplated by this Agreement shall be in effect, nor shall any proceeding by any state, local or federal government agency or entity seeking any of the foregoing be pending. There shall not have been any action taken, or any statute, rule, regulation or order enacted, entered, enforced or deemed applicable to the transactions contemplated by this Agreement, which makes the consummation of the transactions contemplated by this Agreement illegal.
E. Tax Opinion. The Acquiring Portfolio shall have obtained an opinion from Reed Smith, special counsel for the Acquiring Portfolio, dated as of the Closing Date, addressed to the Acquiring Portfolio, that the consummation of the transactions set forth in this Agreement comply with the requirements of a reorganization as described in Section 368(a) of the Code. Such opinion shall be based on customary assumptions and such representations as Reed Smith may reasonably request and the Target Portfolio and the Acquiring Portfolio will cooperate to make and certify the accuracy of such representations.
F. Shareholder List. The Target Portfolio shall have delivered to the Acquiring Portfolio an updated list of all shareholders of the Target Portfolio, as reported by the Target Portfolio’s transfer agent, as of one (1) business day prior to the Closing Date with each shareholder’s respective holdings in the Target Portfolio, taxpayer identification numbers, Form W9 and last known address.
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G. Officer Certificates. The Acquiring Portfolio shall have received a certificate of an authorized officer of the Target Portfolio, dated as of the Closing Date, certifying that the representations and warranties set forth in Section 4 hereof are true and correct on the Closing Date, together with certified copies of the resolutions adopted by the Board on behalf of the Target Portfolio and by Target Portfolio shareholders.
9. Amendment, Waiver and Termination.
A. The parties hereto may, by agreement in writing authorized by the Board on behalf of each of the Target Portfolio and the Acquiring Portfolio, amend this Agreement at any time before or after approval thereof by the shareholders of the Target Portfolio; provided, however, that after receipt of Target Portfolio shareholder approval, no amendment shall be made by the parties hereto which substantially changes the terms of Sections 1, 2 and 3 hereof without obtaining Target Portfolio’s shareholder approval thereof.
B. At any time prior to the Closing Date, either of the parties may by written instrument signed by it (i) waive any inaccuracies in the representations and warranties made to it contained herein and (ii) waive compliance with any of the covenants or conditions made for its benefit contained herein. No delay on the part of either party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any such right, power or privilege, or any single or partial exercise of any such right, power or privilege, preclude any further exercise thereof or the exercise of any other such right, power or privilege.
C. This Agreement may be terminated, and the transactions contemplated herein may be abandoned at any time prior to the Closing Date:
i. | by the consent of the Board on behalf of each of the Target Portfolio and the Acquiring Portfolio; |
ii. | by the Target Portfolio, if the Acquiring Portfolio breaches in any material respect any of its representations, warranties, covenants or agreements contained in this Agreement; |
iii. | by the Acquiring Portfolio, if the Target Portfolio breaches in any material respect any of its representations, warranties, covenants or agreements contained in this Agreement; |
iv. | by either the Target Portfolio or the Acquiring Portfolio, if the Closing has not occurred on or prior to December 31, 2020 (provided that the rights to terminate this Agreement pursuant to this subsection (C)(iv) shall not be available to any party whose failure to fulfill any of its obligations under this Agreement has been the cause of or resulted in the failure of the closing to occur on or before such date); |
v. | by the Acquiring Portfolio in the event that: (a) all the conditions precedent to the Target Portfolio’s obligation to close, as set forth in Section 7 hereof, have been fully satisfied (or can be fully satisfied at the Closing); (b) the Acquiring Portfolio gives the Target Portfolio written assurance of its intent to close irrespective of the satisfaction or non-satisfaction of all conditions precedent to the Acquiring Portfolio’s obligation to close, as set forth in Section 8 hereof; and (c) the Target Portfolio then fails or refuses to close within the earlier of ten (10) business days or December 31, 2020; or |
vi. | by the Target Portfolio in the event that: (a) all the conditions precedent to the Acquiring Portfolio’s obligation to close, as set forth in Section 8 hereof have been fully satisfied (or can be fully satisfied at the Closing); (b) the Target Portfolio gives the Acquiring Portfolio written assurance of its intent to close irrespective of the satisfaction or non-satisfaction of all the conditions precedent to the Target Portfolio’s obligation to close, as set forth in Section 7 hereof; and (c) the Acquiring Portfolio then fails or refuses to close within the earlier of ten (10) business days or December 31, 2020. |
10. Remedies.
In the event of termination of this Agreement by either or both of the Target Portfolio and Acquiring Portfolio pursuant to Section 9(C) hereof, written notice thereof shall forthwith be given by the terminating party to the other party hereto, and this Agreement shall therefore terminate and become void and have no effect, and the transactions contemplated herein and thereby shall be abandoned, without further action by the parties hereto.
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11. Survival of Warranties and Indemnification.
A. Survival. The representations and warranties included or provided for herein, or in the schedules or other instruments delivered or to be delivered pursuant hereto, shall survive the Closing Date for a three (3) year period except that any representation or warranty with respect to taxes shall survive for the expiration of the statutory period of limitations for assessments of tax deficiencies as the same may be extended from time to time by the taxpayer. The covenants and agreements included or provided for herein shall survive and be continuing obligations in accordance with their terms. The period for which a representation, warranty, covenant or agreement survives shall be referred to hereinafter as the “Survival Period.” Notwithstanding anything set forth in the immediately preceding sentence, the right of the Acquiring Portfolio and the Target Portfolio to seek indemnity pursuant to this Agreement shall survive for a period of ninety (90) days beyond the expiration of the Survival Period of the representation, warranty, covenant or agreement upon which indemnity is sought. In no event shall the Acquiring Portfolio or the Target Portfolio be obligated to indemnify the other if indemnity is not sought within ninety (90) days of the expiration of the applicable Survival Period.
B. Indemnification. Each party (an “Indemnitor”) shall indemnify and hold the other and its directors, officers, agents and persons controlled by or controlling any of them (each an “Indemnified Party”) harmless from and against any and all losses, damages, liabilities, claims, demands, judgments, settlements, deficiencies, taxes, assessments, charges, costs and expenses of any nature whatsoever (including reasonable attorneys’ fees), including amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and counsel fees reasonably incurred by such Indemnified Party in connection with the defense or disposition of any claim, action, suit or other proceeding, whether civil or criminal, before any court or administrative or investigative body in which such Indemnified Party may be or may have been involved as a party or otherwise or with which such Indemnified Party may be or may have been threatened (collectively, the “Losses”) arising out of or related to any claim of a breach of any representation, warranty or covenant made herein by the Indemnitor, provided, however, that no Indemnified Party shall be indemnified hereunder against any Losses arising directly from such Indemnified Party’s (i) willful misfeasance, (ii) bad faith, (iii) gross negligence or (iv) reckless disregard of the duties involved in the conduct of such Indemnified Party’s position.
C. Indemnification Procedure. The Indemnified Party shall use its best efforts to minimize any liabilities, damages, deficiencies, claims, judgments, assessments, costs and expenses in respect of which indemnity may be sought hereunder. The Indemnified Party shall give written notice to the Indemnitor within the earlier of ten (10) days of receipt of written notice to the Indemnified Party or thirty (30) days from discovery by the Indemnified Party of any matters which may give rise to a claim for indemnification or reimbursement under this Agreement. The failure to give such notice shall not affect the right of the Indemnified Party to indemnity hereunder unless such failure has materially and adversely affected the rights of the Indemnitor; provided that in any event such notice shall have been given prior to the expiration of the Survival Period. At any time after ten (10) days from the giving of such notice, the Indemnified Party may, at its option, resist, settle or otherwise compromise, or pay such claim unless it shall have received notice from the Indemnitor that the Indemnitor intends, at the Indemnitor’s sole cost and expense, to assume the defense of any such matter, in which case the Indemnified Party shall have the right, at no cost or expense to the Indemnitor, to participate in such defense. If the Indemnitor does not assume the defense of such matter, and in any event until the Indemnitor states in writing that it will assume the defense, the Indemnitor shall pay all costs of the Indemnified Party arising out of the defense until the defense is assumed; provided, however, that the Indemnified Party shall consult with the Indemnitor and obtain the Indemnitor’s prior written consent to any payment or settlement of any such claim. The Indemnitor shall keep the Indemnified Party fully apprised at all times as to the status of the defense. If the Indemnitor does not assume the defense, the Indemnified Party shall keep Indemnitor apprised at all times as to the status of the defense. Following indemnification as provided for hereunder, the Indemnitor shall be subrogated to all rights of the Indemnified Party with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made.
12. Survival.
The provisions set forth in Sections 10, 11 and 16 hereof shall survive the termination of this Agreement for any cause whatsoever.
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13. Notices.
All notices hereunder shall be sufficiently given for all purposes hereunder if in writing and delivered personally or sent by registered mail or certified mail, postage prepaid. Notice to the Target Portfolio shall be addressed to the Target Portfolio c/o Thrivent Series Fund, Inc., 901 Marquette Avenue, Suite 2500, Minneapolis, Minnesota 55402, Attention: Chief Legal Officer, or at such other address as the Target Portfolio may designate by written notice to the Acquiring Portfolio. Notice to the Acquiring Portfolio shall be addressed to the Acquiring Portfolio c/o Thrivent Series Fund, Inc., 901 Marquette Avenue, Suite 2500, Minneapolis, Minnesota 55402, Attention: Chief Legal Officer, or at such other address and to the attention of such other person as the Acquiring Portfolio may designate by written notice to the Target Portfolio. Any notice shall be deemed to have been served or given as of the date such notice is delivered personally or mailed.
14. Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties hereto and their successors and assigns. This Agreement shall not be assigned by any party without the prior written consent of the other party hereto.
15. Books and Records.
All books and records of the Target Portfolio, including all books and records required to be maintained under the Investment Company Act of 1940, as amended (the “1940 Act”), and the rules and regulations thereunder, shall be available to the Acquiring Portfolio from and after the Closing Date and shall be turned over to the Acquiring Portfolio as soon as practicable following the Closing Date.
16. General.
This Agreement supersedes all prior agreements between the parties (written or oral), is intended as a complete and exclusive statement of the terms of the Agreement between the parties and may not be amended, modified or changed, or terminated orally. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been executed by the Fund on behalf of the Target Portfolio and by the Fund on behalf of the Acquiring Portfolio and delivered to each of the parties hereto. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. This Agreement is for the sole benefit of the parties hereto, and nothing in this Agreement, expressed or implied, is intended to confer upon any other person any rights or remedies under or by reason of this Agreement. This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota without regard to principles of conflicts or choice of law.
17. Limitation of Liability.
It is expressly agreed that the obligations of the Fund hereunder shall not be binding upon any of the Directors, shareholders, nominees, officers, agents or employees of the Fund personally, but shall bind only the property of the Fund, as provided in the Articles of Incorporation. The execution and delivery of this Agreement have been authorized by the Directors and signed by an authorized officer of the Fund, acting as such, and neither such authorization by such Directors nor such execution and delivery by such officer shall be deemed to have been made by any of them personally, but shall bind only the property of the Fund as provided in the Articles of Incorporation. The obligations of any series of the Fund hereunder shall be the exclusive obligation of that series and the parties hereto can only look to the assets of that series to satisfy any debt or obligation incurred by that series hereunder.
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IN WITNESS WHEREOF, the parties have hereunto caused this Agreement to be executed and delivered by their duly authorized officers as of the day and year first written above.
Thrivent Series Fund, Inc. On Behalf of Its Series, Thrivent Partner Growth Stock Portfolio |
|
Name: David S. Royal Title: President and Chief Investment Officer |
Attest: |
|
Name: John D. Jackson Title: Assistant Secretary |
Thrivent Series Fund, Inc. On Behalf of Its Series, Thrivent Large Cap Growth Portfolio |
|
Name: David S. Royal Title: President and Chief Investment Officer |
Attest: |
|
Name: John D. Jackson Title: Assistant Secretary |
Thrivent Financial for Lutherans (solely for purposes of Section 3.F.) |
|
Name: David S. Royal Title: Chief Investment Officer |
Attest: |
|
Name: John D. Jackson Title: Senior Counsel |
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STATEMENT OF ADDITIONAL INFORMATION OF THE REGISTRANT
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901 Marquette Avenue, Suite 2500
Thrivent All Cap Portfolio
Thrivent ESG Index Portfolio
Thrivent High Yield Portfolio
Thrivent Income Portfolio
Thrivent International Index Portfolio
Thrivent Large Cap Growth Portfolio
Thrivent Large Cap Index Portfolio
Thrivent Large Cap Value Portfolio
Thrivent Low Volatility Equity Portfolio
Thrivent Mid Cap Growth Portfolio
Thrivent Mid Cap Index Portfolio
Thrivent Mid Cap Stock Portfolio
Thrivent Mid Cap Value Portfolio
Thrivent Money Market Portfolio
Thrivent Opportunity Income Plus Portfolio
Thrivent Partner Growth Stock Portfolio
Thrivent Partner Healthcare Portfolio
Thrivent Small Cap Growth Portfolio
Thrivent Small Cap Index Portfolio
Thrivent Small Cap Stock Portfolio
• | Aggregate initial margin and premiums required to establish its futures, options on futures and swap positions do not exceed 5% of the liquidation value of the Portfolio’s portfolio, after taking into account unrealized profits and losses on such positions; or |
• | Aggregate net notional value of its futures, options on futures and swap positions does not exceed 100% of the liquidation value of the Portfolio’s portfolio, after taking into account unrealized profits and losses on such positions. |
• | When the Portfolio enters into a contract for the purchase or sale of a security denominated in a foreign currency, it may desire to “lock in” the U.S. dollar price of the security. By entering into a forward contract for the purchase or sale, for a fixed amount of dollars, of the amount of foreign currency involved in the underlying security transactions, the Portfolio will be able to protect itself against a possible loss resulting from an adverse change in the relationship between the U.S. dollar and the subject foreign currency during the period between the date the security is purchased or sold and the date on which payment is made or received. |
• | When a Portfolio determines that one currency may experience a substantial movement against another currency, including the U.S. dollar, a Portfolio may enter into a forward contract to sell or buy the amount of the former foreign currency, approximating the value of some or all of a Portfolio’s securities denominated in such foreign currency. |
Service Provider | Service | Frequency | ||
The Bank of New York Mellon Corporation | Middle Office / Settlements Vendor | Daily | ||
Bloomberg | Trading System & Data Vendor | Daily | ||
Bloomberg BVAL | Pricing Service | Daily | ||
BNP Paribas Security Services | Middle Office / Settlements Vendor | Daily | ||
Confluence | Regulatory Reporting Vendor | Quarterly; monthly for Thrivent Money Market Portfolio | ||
Donnelley Financial Solutions, Inc. | Regulatory Printer | Quarterly | ||
Ernst and Young | PFIC analysis | Quarterly | ||
FactSet Research Systems Inc. | Systems Vendor | Daily | ||
Fidelity National Information Services, Inc. | Mutual Fund Accounting System Vendor | Daily | ||
Fidelity National Information Services, Inc. | Personal Trading System Vendor | Daily | ||
Goldman Sachs Bank USA | Securities Lending Agent | Daily | ||
ICE Data Services | Pricing Service | Daily | ||
IHS Markit | Pricing Service | Daily | ||
IHS Markit | Bank Debt Reconciliation Vendor | Daily | ||
Institutional Shareholder Services | Proxy Voting & Class Action Services Vendor | Daily |
Service Provider | Service | Frequency | ||
ITG Inc. | Systems Vendor | Daily | ||
Lipper | Data Vendor | Monthly; 1 day lag | ||
Merrill Corporation | Printer | Quarterly | ||
Morningstar | Data Vendor | Monthly; 60 day lag | ||
MSCI | Systems Vendor | Daily | ||
Omgeo LLC | Systems Vendor | Daily | ||
PricewaterhouseCoopers LLP | Independent Registered Public Accounting Firm | Annually | ||
PricingDirect Inc. | Pricing Service | Daily | ||
State Street Bank and Trust Company | Bank Loan Servicing | Daily | ||
State Street Bank and Trust Company | Custodian | Daily | ||
State Street Bank and Trust Company | Systems Vendor | Weekly | ||
VMLY&R | Website Consultant | Monthly | ||
Wolters Kluwer | Systems Vendor | Monthly; 3 day lag |
1. | None of the Portfolios may borrow money, except that a Portfolio may borrow money (through the issuance of debt securities or otherwise) in an amount not exceeding one-third of the Portfolio’s total assets immediately after the time of such borrowing. |
2. | None of the Portfolios may issue senior securities, except as permitted under the 1940 Act or any exemptive order or rule issued by the Securities and Exchange Commission. |
3. | None of the Portfolios (except as noted below) will, with respect to 75% of its total assets, purchase securities of an issuer (other than the U.S. government, its agencies, instrumentalities or authorities or repurchase agreements fully collateralized by U.S. government securities, and other investment companies) if (a) such purchase would, at the time, cause more than 5% of the Portfolio’s total assets taken at market value to be invested in the securities of such issuer; or (b) such purchase would, at the time, result in more than 10% of the outstanding voting securities of such issuer being held by the Portfolio. This restriction does not apply to Thrivent Large Cap Growth Portfolio or Thrivent Partner Healthcare Portfolio, which are “non-diversified” within the meaning of the 1940 Act. |
4. | None of the Portfolios will buy or sell real estate, except that any Portfolio may (i) acquire or lease office space for its own use, (ii) invest in securities of issuers that invest in real estate or interest therein, (iii) invest in mortgage-related securities and other securities that are secured by real estate or interest therein, and (iv) hold and sell real estate acquired by the Portfolio as a result of the ownership of securities. |
5. | None of the Portfolios may purchase or sell commodities or commodity contracts, except that any Portfolio may purchase and sell derivatives (including but not limited to options, futures contracts and options on futures contracts) whose value is tied to the value of a financial index or a financial instrument or other asset (including, but not limited to, securities indexes, interest rates, securities, currencies and physical commodities). |
6. | None of the Portfolios may make loans, except that any Portfolio may (i) lend portfolio securities, (ii) enter into repurchase agreements, (iii) purchase all or a portion of an issue of debt securities, bank loan participation interests, bank certificates of deposit, bankers’ acceptances, debentures or other securities, whether or not the purchase is made upon the original issuance of the securities, and (iv) participate in an interfund lending program with other registered investment companies. |
7. | None of the Portfolios will underwrite the securities of other issuers, except where the Portfolio may be deemed to be an underwriter for purposes of certain federal securities laws in connection with the disposition of portfolio securities; with investments in other investment companies; and with loans that a Portfolio may make pursuant to its fundamental investment restriction on lending. |
8. | None of the Portfolios (except as noted below) will purchase a security if, after giving effect to the purchase, more than 25% of its total assets would be invested in the securities of one or more issuers conducting their principal business activities in the same industry, except that this restriction does not apply to U.S. Government securities (as such term is defined in the 1940 Act). In addition, with respect to Thrivent Money Market Portfolio, this restriction does not apply to instruments issued by domestic banks. This restriction does not apply to the Thrivent Asset Allocation Portfolios, which primarily invest in other Portfolios of the Fund that could be considered to be in the same industry. In addition, under normal circumstances, Thrivent Partner Healthcare Portfolio will invest more than 25% of its total assets in the securities of issuers in the healthcare industry. |
1. | None of the Portfolios will purchase any security while borrowings, including reverse repurchase agreements, representing more than 5% of the Portfolio’s total assets are outstanding. The Portfolios intend to limit borrowings to amounts borrowed from a bank, reverse repurchase agreements (insofar as they are considered borrowings), or an interfund lending agreement. |
2. | The fundamental investment restriction with respect to industry concentration (number 8 above) will be applied pursuant to SEC policy at 25% (instead of “more than 25%”) of a Portfolio’s total assets. |
3. | None of the Portfolios currently intend to purchase securities on margin, except that a Portfolio may obtain such short-term credits as are necessary for the clearance of transactions, and provided that margin payments in connection with futures contracts and options on futures contracts shall not constitute purchasing securities on margin. |
4. | The fundamental investment restriction with respect to diversification (number 3 above) will be applied so securities issued by U.S. government agencies, instrumentalities, or authorities will be eligible for the exception only if those securities qualify as a “Government security” under the 1940 Act. |
5. | The exception for exemptive orders in the fundamental investment restriction with respect to senior securities (number 2 above) will be applied only for exemptive orders issued to the Portfolios. |
• | Bond Portfolio Industries: |
• | Stock Portfolio Industries: |
• | REIT Portfolio Industries: |
• | Money Market Portfolio Industries: |
1. | The Banking Industry is sub-divided into Banks-Foreign and Banks-Domestic. |
2. | Asset-backed commercial paper is categorized into one of the following custom categories: ABCP-Commercial; ABCP-Consumer; ABCP-Diversified; ABCP-Government; and ABCP-Securities. |
3. | Municipal debt is categorized using the following custom list for municipal bonds. |
• | Municipal Bond Categories: |
Category | ||
Revenue Bond Industries | Airport Revenue | Multi-Family Housing |
Education Revenue | Recreational Facilities | |
Electric Revenue | Single-Family Housing | |
Gaming | Special Tax Revenue | |
Healthcare (Non-Hospital) | Surface Transportation | |
Higher Education | Tax Increment Financing | |
Hospital | Tobacco | |
Industrial Development Revenue | Water & Sewer | |
Industrial Development Revenue – Environmental | Other Miscellaneous | |
Lease / Appropriation Revenue | ||
General Obligation | City Bonds | State Bonds |
County Bonds | School District | |
Governments | Escrowed to Maturity/Pre-refunded |
• | Trustee of Thrivent Mutual Funds, a registered investment company consisting of 25 series, which offers Class A and Class S shares; |
• | Trustee of Thrivent Cash Management Trust, a registered investment company consisting of one fund that serves as a cash collateral fund for a securities lending program sponsored by Thrivent Financial; and |
• | Trustee of Thrivent Core Funds, a registered investment company consisting of five funds that are established solely for investment by Thrivent entities. |
Name, Address and Year of Birth | Position with the Fund and Length of Service(2) | Principal Occupation During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director | Other Directorships Held Currently and within Past Five Years | ||||
David S. Royal 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1971) | Chief Investment Officer since 2017; Director and President since 2015 | Senior Vice President, Chief Investment Officer, Thrivent Financial since 2017; VP, President, Mutual Funds, Thrivent Financial from 2015 to 2017; Vice President and Deputy General Counsel, Thrivent Financial from 2006 to 2015 | 65 | Currently, Director of Children’s Cancer Research Fund and Board Member of Twin Bridge Capital Partners; Director of Fairview Hospital Foundation until 2017 | ||||
Russell W. Swansen 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1957) | Director since 2009 | Retired; Senior Vice President and Chief Investment Officer, Thrivent Financial from 2003 to 2017 | 64 | Board Member of Twin Bridge Capital Partners, a registered investment advisory firm, since 2005 |
Name, Address and Year of Birth | Position with the Fund and Length of Service(2) | Principal Occupation During the Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director | Other Directorships Held Currently and within Past Five Years | ||||
Janice B. Case 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1952) | Director since 2011 | Retired | 64 | Independent Trustee of North American Electric Reliability Corporation (the electric reliability organization (“ERO”) for North America) since 2008 |
Name, Address and Year of Birth | Position with the Fund and Length of Service(2) | Principal Occupation During the Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director | Other Directorships Held Currently and within Past Five Years | ||||
Robert J. Chersi 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1961) | Director since 2017 | Founder of Chersi Services LLC (consulting firm) since 2014; Executive Director of Center for Global Governance, Reporting & Regulation and Adjunct Professor of Finance and Economics at Pace University since 2013; Helpful Executive in Reach in the Department of Accounting & Information Systems at Rutgers University since 2013 | 64 | Director and member of the Audit and Risk Oversight Committees of E*TRADE Financial Corporation and Director of E*TRADE Bank since 2019; Lead Independent Director since 2019 and Director and Audit Committee Chair at Brightsphere Investment Group plc since 2016 | ||||
Marc S. Joseph 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1960) | Director since 2011 | Managing Director of Granite Ridge LLP (consulting and advisory firm) since 2009; Managing Director of Triangle Crest (private investing and consulting firm) since 2004 | 61 | None | ||||
Paul R. Laubscher 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1956) | Director since 2009 | Portfolio Manager for U.S. private real estate and private equity portfolios of IBM Retirement Funds | 64 | None | ||||
James A. Nussle 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1960) | Director since 2011 | President and Chief Executive Officer of Credit Union National Association since September 2014; President and Chief Operating Officer of Growth Energy (trade association) from 2010 through August 2014; Director of Portfolio Recovery Associates (PRAA) since 2010; CEO of The Nussle Group LLC (consulting firm) since 2009 | 64 | Advisory Board member of AVISTA Capital Partners (private equity firm) from 2010 to 2015 |
Name, Address and Year of Birth | Position with the Fund and Length of Service(2) | Principal Occupation During the Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director | Other Directorships Held Currently and within Past Five Years | ||||
Verne O. Sedlacek 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1954) | Director since 2017 | Chief Executive Officer of E&F Advisors LLC (consulting) since 2015; President & Chief Executive Officer of the Commonfund from 2003 to 2015 | 64 | Trustee of Valparaiso University since 2015; Trustee of Museum of American Finance since 2015; Chairman of the Board of Directors of AGB Institutional Strategies from 2016 to 2019; Director of Association of Governing Boards of Universities and Colleges from 2007 to 2019 | ||||
Constance L. Souders 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1950) | Director since 2007 | Retired | 64 | None |
Name, Address and Year of Birth | Position with Fund and Length of Service (2) | Principal Occupation During the Past 5 Years | ||
David S. Royal 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1971) | Chief Investment Officer since 2017; Director and President since 2015 | Senior Vice President, Chief Investment Officer, Thrivent Financial since 2017; VP, President, Mutual Funds, Thrivent Financial from 2015 to 2017; Vice President and Deputy General Counsel, Thrivent Financial from 2006 to 2015 | ||
Gerard V. Vaillancourt 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1967) | Treasurer and Principal Accounting Officer since 2005 | Vice President and Mutual Funds Chief Financial Officer, Thrivent Financial since 2017; Vice President, Mutual Fund Accounting, Thrivent Financial from 2006 to 2017 | ||
Michael W. Kremenak 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1978) | Secretary and Chief Legal Officer since 2015 | Vice President, Thrivent Financial since 2015; Senior Counsel, Thrivent Financial from 2013 to 2015 |
Name, Address and Year of Birth | Position with Fund and Length of Service (2) | Principal Occupation During the Past 5 Years | ||
Edward S. Dryden 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1965) | Chief Compliance Officer since 2010 | Vice President, Chief Compliance Officer – Thrivent Funds, Thrivent Financial since 2018; Director, Chief Compliance Officer – Thrivent Funds, Thrivent Financial from 2010 to 2018 | ||
Kathleen M. Koelling 4321 North Ballard Road Appleton, WI (1977) | Privacy Officer since 2011 | Vice President, Deputy General Counsel, Thrivent Financial since 2018; Vice President, Managing Counsel, Thrivent Financial from 2016 to 2018; Privacy Officer, Thrivent Financial since 2011; Anti-Money Laundering Officer, Thrivent Financial from 2011 to 2019; Senior Counsel, Thrivent Financial from 2002 to 2016 | ||
Sharon K. Minta 4321 North Ballard Road Appleton, WI (1973) | Anti-Money Laundering Officer since 2019 | Director, Compliance, Anti-Money Laundering Officer and Manager of Identity Theft and Customer Fraud/Special Investigations Unit, Thrivent Financial since 2019; Compliance Manager, Anti-Money Laundering, Customer Fraud/Special Investigations Unit and Identity Theft programs, Thrivent Financial from 2014 to 2019 | ||
Troy A. Beaver 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1967) | Vice President since 2016 | Vice President, Mutual Funds Marketing & Distribution, Thrivent Financial since 2015; Vice President, Marketing, American Century Investments from 2006 to 2015 | ||
Monica L. Kleve 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1969) | Vice President since 2019 | Vice President, Investment Operations, Thrivent Financial since 2019; Director, Investments Systems and Solutions, Thrivent Financial from 2002 to 2019 | ||
Kathryn A. Stelter 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1962) | Vice President since 2015 | Vice President, Mutual Funds Chief Operations Officer, Thrivent Financial since 2017; Director, Mutual Fund Operations, Thrivent Financial from 2014 to 2017; Director, Mutual Fund Operations at Hartford Funds from 2006 to 2014 | ||
Jill M. Forte 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1974) | Assistant Secretary since 2016 | Senior Counsel, Thrivent Financial since 2017; Counsel, Thrivent Financial from 2015 to 2017; Associate Counsel, Ameriprise Financial, Inc. from 2013 to 2015 | ||
John D. Jackson 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1977) | Assistant Secretary since 2018 | Senior Counsel, Thrivent Financial since 2017; Associate General Counsel, RBC Global Asset Management (US) Inc. from 2011 to 2017 |
Name, Address and Year of Birth | Position with Fund and Length of Service (2) | Principal Occupation During the Past 5 Years | ||
Sarah L. Bergstrom 901 Marquette Avenue, Suite 2500 Minneapolis, MN (1977) | Assistant Treasurer since 2007 | Head of Mutual Fund Accounting, Thrivent Financial since 2017; Director, Fund Accounting Administration, Thrivent Financial from 2007 to 2017 |
(1) | “Interested person” of the Fund as defined in the 1940 Act by virtue of a position with Thrivent Financial. Mr. Royal is considered an interested person because of his principal occupation with Thrivent Financial. Mr. Swansen is considered an interested person because of his past occupation with Thrivent Financial. |
(2) | Each Director generally serves an indefinite term until her or his successor is duly elected and qualified. Officers generally serve at the discretion of the Board until their successors are duly appointed and qualified. |
(3) | The Directors, other than Mr. Royal and Mr. Swansen, are not “interested persons” of the Fund and are referred to as “Independent Directors.” |
Committee | Members (1) | Function | Meetings Held During Last Fiscal Year | |||
Audit | Janice B. Case Robert J. Chersi Marc S. Joseph Paul R. Laubscher James A. Nussle Verne O. Sedlacek Constance L. Souders | The 1940 Act requires that the Fund’s independent auditors be selected by a majority of those Directors who are not “interested persons” (as defined in the 1940 Act) of the Fund. The Audit Committee is responsible for recommending the engagement or retention of the Fund’s independent accountants, reviewing with the independent accountants the plan and the results of the auditing engagement, approving professional services, including permitted non-audit services, provided by the independent accountants prior to the performance of such services, considering the range of audit and non-audit fees, reviewing the independence of the independent accountants, reviewing the scope and results of procedures of internal auditing, and reviewing the system of internal accounting control. | 6 | |||
Contracts | Janice B. Case Robert J. Chersi Marc S. Joseph Paul R. Laubscher James A. Nussle Verne O. Sedlacek Constance L. Souders | The function of the Contracts Committee is to assist the Board in fulfilling its duties with respect to the review and approval of contracts between the Fund and other entities, including entering into new contracts and the renewal of existing contracts. The Contracts Committee considers investment advisory, distribution, transfer agency, administrative service and custodial contracts, and such other contracts as the Board deems necessary or appropriate for the continuation of operations of each Portfolio. | 6 |
Committee | Members (1) | Function | Meetings Held During Last Fiscal Year | |||
Ethics and Compliance | Janice B. Case Robert J. Chersi Marc S. Joseph Paul R. Laubscher James A. Nussle Verne O. Sedlacek Constance L. Souders | The function of the Ethics and Compliance Committee is to monitor the ethics of the Adviser and oversee the legal and regulatory compliance matters of the Portfolios. | 4 | |||
Governance and Nominating | Janice B. Case Robert J. Chersi Marc S. Joseph Paul R. Laubscher James A. Nussle Verne O. Sedlacek Constance L. Souders | The Governance and Nominating Committee assists the Board in fulfilling its duties with respect to the governance of the Fund, including recommendations regarding evaluation of the Board, compensation of the Directors and composition of the committees and the Board’s membership. The Governance and Nominating Committee makes recommendations regarding nominations for Directors and will consider nominees suggested by shareholders sent to the attention of the President of the Fund. | 4 | |||
Investment | Janice B. Case Robert J. Chersi Marc S. Joseph Paul R. Laubscher James A. Nussle Verne O. Sedlacek Constance L. Souders | The Investments Committee assists the Board in its oversight of the investment performance of the Portfolios; the Portfolios’ consistency with their investment objectives and styles; management’s selection of benchmarks, peer groups and other performance measures for the Portfolios; and the range of investment options offered to investors in the Portfolios. In addition, the Committee assists the Board in its review of investment-related aspects of management’s proposals, such as new Portfolios or Portfolio reorganizations. | 5 |
(1) | All of the Independent Directors serve as members of each Committee. |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
David S. Royal | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Russell W. Swansen | Thrivent Aggressive Allocation Portfolio | $50,001-$100,000 | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Janice B. Case | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Robert J. Chersi | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Marc S. Joseph | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Paul R. Laubscher | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
James A. Nussle | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Verne O. Sedlacek | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None | ||||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None | ||||
Constance L. Souders | Thrivent Aggressive Allocation Portfolio | None | Over $100,000 | ||
Thrivent All Cap Portfolio | None | ||||
Thrivent Balanced Income Plus Portfolio | None | ||||
Thrivent Diversified Income Plus Portfolio | None | ||||
Thrivent Global Stock Portfolio | None | ||||
Thrivent Government Bond Portfolio | None | ||||
Thrivent High Yield Portfolio | None | ||||
Thrivent Income Portfolio | None | ||||
Thrivent International Allocation Portfolio | None | ||||
Thrivent Large Cap Growth Portfolio | None |
Name of Director | Dollar Range of Beneficial Ownership in the Portfolio | Aggregate Dollar Range of Beneficial Ownership in All Registered Investment Companies Overseen by the Director in the Family of Investment Companies | |||
Thrivent Large Cap Index Portfolio | None | ||||
Thrivent Large Cap Value Portfolio | None | ||||
Thrivent Limited Maturity Bond Portfolio | None | ||||
Thrivent Low Volatility Equity Portfolio | None | ||||
Thrivent Mid Cap Index Portfolio | None | ||||
Thrivent Mid Cap Stock Portfolio | None | ||||
Thrivent Moderate Allocation Portfolio | None | ||||
Thrivent Moderately Aggressive Allocation Portfolio | None | ||||
Thrivent Moderately Conservative Allocation Portfolio | None | ||||
Thrivent Money Market Portfolio | None | ||||
Thrivent Multidimensional Income Portfolio | None | ||||
Thrivent Opportunity Income Plus Portfolio | None | ||||
Thrivent Partner Emerging Markets Equity Portfolio | None | ||||
Thrivent Partner Growth Stock Portfolio | None | ||||
Thrivent Partner Healthcare Portfolio | None | ||||
Thrivent Real Estate Securities Portfolio | None | ||||
Thrivent Small Cap Growth Portfolio | None | ||||
Thrivent Small Cap Index Portfolio | None | ||||
Thrivent Small Cap Stock Portfolio | None |
Name, Position | Aggregate Compensation From Fund | Total Compensation Paid by the Fund Complex(1) | ||
Janice B. Case | $137,534 | $225,500 | ||
Director | ||||
Robert J. Chersi | $149,730 | $245,500 | ||
Director | ||||
Paul R. Laubscher | $168,023 | $275,500 | ||
Director |
Name, Position | Aggregate Compensation From Fund | Total Compensation Paid by the Fund Complex(1) | ||
Marc S. Joseph | $137,534 | $225,500 | ||
Director | ||||
James A. Nussle | $125,328 | $205,500 | ||
Director | ||||
Verne O. Sedlacek | $137,534 | $225,500 | ||
Director | ||||
Constance L. Souders | $137,534 | $225,500 | ||
Director |
(1) | The Fund has adopted a deferred compensation plan for the benefit of the Independent Directors of the Fund who wish to defer receipt of a percentage of eligible compensation which they otherwise are entitled to receive from the Fund. Compensation deferred is invested in Thrivent Mutual Funds, the allocation of which is determined by the individual Director. The Directors participating in the deferred compensation plan do not actually own shares of the Thrivent Mutual Funds through the plan, since deferred compensation is a general liability of the Thrivent Mutual Funds. However, a Director’s return on compensation deferred is economically equivalent to an investment in the applicable Thrivent Mutual Funds. For compensation paid during the fiscal year ended December 31, 2019, the total amount of deferred compensation payable to the Directors was $0. |
• | Separate accounts (the “Accounts”) of Thrivent Financial, which are used to fund benefits under various variable life insurance and variable annuity contracts (each a “variable contract”) issued by Thrivent Financial; |
• | Separate accounts of other insurance companies not affiliated with Thrivent Financial, which are used to fund benefits under variable life insurance and variable annuity contracts; and |
• | Other Portfolios of the Fund. |
Portfolio | Shareholder | Percent Owned | ||
Thrivent Small Cap Index Portfolio | New York Life Insurance and Annuity Corporation 51 Madison Ave. New York, NY 10010-1603 | 10.67% |
Name | Percentage of Shares Outstanding | |
Thrivent Financial for Lutherans | 79.83% | |
Thrivent Asset Allocation Portfolios | 20.04% | |
New York Life Insurance and Annuity Corporation | 00.12% |
Other Registered Investment Companies (1) | Other Accounts | |||||||
Portfolio Manager | # of Accounts Managed | Assets Managed | # of Accounts Managed | Assets Managed | ||||
Gregory R. Anderson (2) | 6 | $ 2,967,252,356 | 3 | $7,687,750,546 | ||||
Darren M. Bagwell | 8 | $12,549,124,989 | 0 | $ 0 | ||||
Brian W. Bomgren (3) | 4 | $ 2,892,197,160 | 3 | $ 816,850,488 | ||||
Brunner, Lauri A. | 2 | $ 3,027,980,607 | 2 | $ 278,590,529 | ||||
Matthew D. Finn | 1 | $ 712,372,701 | 2 | $ 167,132,083 | ||||
Brian J. Flanagan | 1 | $ 2,394,823,923 | 2 | $ 275,587,326 | ||||
John T. Groton | 0 | $ 0 | 1 | $ 233,559,342 | ||||
Michael G. Landreville | 2 | $ 1,111,631,568 | 3 | $ 402,688,156 | ||||
Kurt J. Lauber | 2 | $ 3,059,900,274 | 2 | $ 341,324,663 | ||||
David J. Lettenberger | 1 | $ 9,511,687 | 1 | $ 58,024,180 | ||||
Stephen D. Lowe | 9 | $11,439,115,577 | 2 | $ 119,507,090 | ||||
Noah J. Monsen (3) | 7 | $ 6,224,331,818 | 3 | $ 816,850,488 | ||||
Paul J. Ocenasek | 3 | $ 1,558,256,168 | 3 | $2,857,714,998 | ||||
Reginald L. Pfiefer | 0 | $ 0 | 1 | $ 261,238,414 | ||||
David S. Royal | 4 | $ 8,282,402,689 | 0 | $ 0 | ||||
Mark L. Simenstad | 7 | $ 9,783,684,258 | 0 | $ 0 | ||||
Conrad E. Smith | 1 | $ 734,941,458 | 2 | $ 519,494,315 | ||||
David R. Spangler | 7 | $11,471,794,123 | 1 | $ 45,030,259 | ||||
Cortney L. Swensen | 0 | $ 0 | 0 | $ 0 | ||||
William D. Stouten (4) | 3 | $ 6,173,274,264 | 3 | $2,216,468,255 | ||||
James M. Tinnuci | 1 | $ 712,372,701 | 2 | $ 167,132,083 | ||||
Sharon Wang | 0 | $ 0 | 0 | $ 0 | ||||
Kent L. White | 3 | $ 1,675,928,427 | 2 | $ 119,507,090 |
Other Registered Investment Companies (1) | Other Accounts | |||||||
Portfolio Manager | # of Accounts Managed | Assets Managed | # of Accounts Managed | Assets Managed | ||||
Graham Wong | 0 | $ 0 | 0 | $ 0 |
(1) | The “Other Registered Investment Companies” represent series of Thrivent Mutual Funds, which have substantially similar investment objectives and policies as the Portfolio(s) managed by the portfolio manager listed. |
(2) | In addition to series of Thrivent Mutual Funds, the “Other Registered Investment Companies” represent Thrivent Church Loan and Income Fund. |
(3) | In addition to series of Thrivent Mutual Funds, the “Other Registered Investment Companies” represent series of Thrivent Core Funds. |
(4) | In addition to series of Thrivent Mutual Funds, the “Other Registered Investment Companies” represent series of Thrivent Cash Management Trust and Thrivent Core Funds. |
Portfolio Manager | Portfolio | Portfolio Ownership | Fund (1) | Fund Ownership | Ownership in Fund Complex(2) | |||||
Gregory R. Anderson | Thrivent Diversified Income Plus Portfolio | None | Thrivent Diversified Income Plus Fund | None | $100,001- $500,000 | |||||
Thrivent Government Bond Portfolio | None | Thrivent Government Bond Fund | None | |||||||
Thrivent Limited Maturity Bond Portfolio | None | Thrivent Limited Maturity Bond Fund | $100,001- $500,000 | |||||||
Thrivent Multidimensional Income Portfolio | None | Thrivent Multidimensional Income Fund | None | |||||||
Thrivent Opportunity Income Plus Portfolio | None | Thrivent Opportunity Income Plus Fund | None | |||||||
Darren M. Bagwell | Thrivent Aggressive Allocation Portfolio | None | Thrivent Aggressive Allocation Fund | $500,001- $1,000,000 | Over $1,000,000 | |||||
Thrivent Balanced Income Plus Portfolio | None | Thrivent Balanced Income Plus Fund | None | |||||||
Thrivent Diversified Income Plus Portfolio | None | Thrivent Diversified Income Plus Fund | None | |||||||
Thrivent Global Stock Portfolio | None | Thrivent Global Stock Fund | None | |||||||
Thrivent International Allocation Portfolio | None | Thrivent International Allocation Fund | None | |||||||
Thrivent Moderate Allocation Portfolio | None | Thrivent Moderate Allocation Fund | None | |||||||
Thrivent Moderately Aggressive Allocation Portfolio | None | Thrivent Moderately Aggressive Allocation Fund | None | |||||||
Thrivent Moderately Conservative Allocation Portfolio | None | Thrivent Moderately Conservative Allocation Fund | None | |||||||
Brian M. Bomgren | Thrivent International Allocation Portfolio | None | Thrivent International Allocation Fund | None | $50,001- $100,000 | |||||
Thrivent Large Cap Index Portfolio | None | |||||||||
Thrivent Low Volatility Equity Portfolio | None | Thrivent Low Volatility Equity Fund | None | |||||||
Thrivent Mid Cap Index Portfolio | None | |||||||||
Thrivent Small Cap Index Portfolio | None | |||||||||
Lauri Brunner | Thrivent Global Stock Portfolio | None | Thrivent Global Stock Fund | None | $100,001- $500,000 |
Portfolio Manager | Portfolio | Portfolio Ownership | Fund (1) | Fund Ownership | Ownership in Fund Complex(2) | |||||
Thrivent Large Cap Growth Portfolio | None | Thrivent Large Cap Growth Fund | None | |||||||
Matthew D. Finn | Thrivent All Cap Portfolio | None | Thrivent All Cap Fund | None | $500,001- $1,000,000 | |||||
Thrivent Small Cap Stock Portfolio | None | Thrivent Small Cap Stock Fund | $500,001- $1,000,000 | |||||||
Brian J. Flanagan | Thrivent Mid Cap Stock Portfolio | None | Thrivent Mid Cap Stock Fund | $100,001- $500,000 | $100,001- $500,000 | |||||
John T. Groton | Thrivent All Cap Portfolio | None | $100,001- $500,000 | |||||||
Michael G. Landreville | Thrivent Government Bond Portfolio | None | Thrivent Government Bond Fund | None | $50,001- $100,000 | |||||
Thrivent Limited Maturity Bond Portfolio | None | Thrivent Limited Maturity Bond Fund | $50,001- $100,000 | |||||||
Kurt J. Lauber | Thrivent Global Stock Portfolio | None | Thrivent Global Stock Fund | None | $100,001- $500,000 | |||||
Thrivent Large Cap Value Portfolio | None | Thrivent Large Cap Value Fund | $100,001- $500,000 | |||||||
David J. Lettenberger | Thrivent Small Cap Growth Portfolio | None | Thrivent Small Cap Growth Fund | None | None | |||||
Stephen D. Lowe | Thrivent Aggressive Allocation Portfolio | None | Thrivent Aggressive Allocation Fund | $100,001- $500,000 | Over $1,000,000 | |||||
Thrivent Balanced Income Plus Portfolio | None | Thrivent Balanced Income Plus Fund | None | |||||||
Thrivent Diversified Income Plus Portfolio | None | Thrivent Diversified Income Plus Fund | None | |||||||
Thrivent Moderate Allocation Portfolio | $100,001- $500,000 | Thrivent Moderate Allocation Fund | $100,001- $500,000 | |||||||
Thrivent Moderately Aggressive Allocation Portfolio | None | Thrivent Moderately Aggressive Allocation Fund | $100,001- $500,000 | |||||||
Thrivent Moderately Conservative Allocation Portfolio | None | Thrivent Moderately Conservative Allocation Fund | None | |||||||
Thrivent Multidimensional Income Portfolio | None | Thrivent Multidimensional Income Fund | None | |||||||
Thrivent Opportunity Income Plus Portfolio | None | Thrivent Opportunity Income Plus Fund | None |
Portfolio Manager | Portfolio | Portfolio Ownership | Fund (1) | Fund Ownership | Ownership in Fund Complex(2) | |||||
Noah J. Monsen | Thrivent Balanced Income Plus Portfolio | None | Thrivent Balanced Income Plus Fund | None | $50,001- $100,000 | |||||
Thrivent Diversified Income Plus Portfolio | None | Thrivent Diversified Income Plus Fund | None | |||||||
Thrivent Global Stock Portfolio | None | Thrivent Global Stock Fund | $1- $10,000 | |||||||
Thrivent International Allocation Portfolio | None | Thrivent International Allocation Fund | None | |||||||
Thrivent Low Volatility Equity Portfolio | None | Thrivent Low Volatility Equity Fund | None | |||||||
Paul J. Ocenasek | Thrivent High Yield Portfolio | None | Thrivent High Yield Fund | None | Over $1,000,000 | |||||
Thrivent Multidimensional Income Portfolio | None | Thrivent Multidimensional Income Fund | None | |||||||
Thrivent Opportunity Income Plus Portfolio | None | Thrivent Opportunity Income Plus Fund | None | |||||||
Reginald L. Pfeifer | Thrivent Real Estate Securities Portfolio | None | None | |||||||
David S. Royal | Thrivent Aggressive Allocation Portfolio | None | Thrivent Aggressive Allocation Fund | $500,001- $1,000,000 | Over $1,000,000 | |||||
Thrivent Moderate Allocation Portfolio | None | Thrivent Moderate Allocation Fund | $1- $10,000 | |||||||
Thrivent Moderately Aggressive Allocation Portfolio | None | Thrivent Moderately Aggressive Allocation Fund | None | |||||||
Thrivent Moderately Conservative Allocation Portfolio | None | Thrivent Moderately Conservative Allocation Fund | None | |||||||
Mark L. Simenstad | Thrivent Aggressive Allocation Portfolio | None | Thrivent Aggressive Allocation Fund | $1- $10,000 | Over $1,000,000 | |||||
Thrivent Balanced Income Plus Portfolio | None | Thrivent Balanced Income Plus Fund | None | |||||||
Thrivent Diversified Income Plus Portfolio | $10,001- $50,000 | Thrivent Diversified Income Plus Fund | None | |||||||
Thrivent Moderate Allocation Portfolio | None | Thrivent Moderate Allocation Fund | None |
Portfolio Manager | Portfolio | Portfolio Ownership | Fund (1) | Fund Ownership | Ownership in Fund Complex(2) | |||||
Thrivent Moderately Aggressive Allocation Portfolio | None | Thrivent Moderately Aggressive Allocation Fund | None | |||||||
Thrivent Moderately Conservative Allocation Portfolio | None | Thrivent Moderately Conservative Allocation Fund | Over $1,000,000 | |||||||
Thrivent Multidimensional Income Portfolio | None | Thrivent Multidimensional Income Fund | $100,001- $500,000 | |||||||
Conrad E. Smith | Thrivent Opportunity Income Plus Portfolio | None | Thrivent Opportunity Income Plus Fund | None | $100,001- $500,000 | |||||
David R. Spangler | Thrivent Aggressive Allocation Portfolio | None | Thrivent Aggressive Allocation Fund | $100,001- $500,000 | $100,001- $500,000 | |||||
Thrivent Balanced Income Plus Portfolio | None | Thrivent Balanced Income Plus Fund | None | |||||||
Thrivent Global Stock Portfolio | None | Thrivent Global Stock Fund | None | |||||||
Thrivent International Allocation Portfolio | None | Thrivent International Allocation Fund | None | |||||||
Thrivent Moderate Allocation Portfolio | None | Thrivent Moderate Allocation Fund | None | |||||||
Thrivent Moderately Aggressive Allocation Portfolio | None | Thrivent Moderately Aggressive Allocation Fund | None | |||||||
Thrivent Moderately Conservative Allocation Portfolio | None | Thrivent Moderately Conservative Allocation Fund | $10,001- $50,000 | |||||||
William D. Stouten | Thrivent Money Market Portfolio | None | Thrivent Money Market Fund | None | $100,001- $500,000 | |||||
James M. Tinucci | Thrivent Small Cap Stock Portfolio | None | Thrivent Small Cap Stock Fund | None | $1- $10,000 | |||||
Sharon Wang | Thrivent Large Cap Index Portfolio | None | None | |||||||
Thrivent Mid Cap Index Portfolio | None | |||||||||
Thrivent Small Cap Index Portfolio | None | |||||||||
Kent L. White | Thrivent Income Portfolio | None | Thrivent Income Fund | $100,001- $500,000 | $500,001- $1,000,000 | |||||
Thrivent Multidimensional Income Portfolio | None | Thrivent Multidimensional Income Fund | None |
Portfolio Manager | Portfolio | Portfolio Ownership | Fund (1) | Fund Ownership | Ownership in Fund Complex(2) | |||||
Thrivent Opportunity Income Plus Portfolio | None | Thrivent Opportunity Income Plus Fund | None |
(1) | Each Fund listed is a series of the Thrivent Mutual Funds, is managed by the same portfolio manager(s) and has substantially similar investment objectives and policies to the corresponding Portfolio listed. |
(2) | Ownership in the Fund Complex includes investments in Thrivent Series Fund, Inc. and Thrivent Mutual Funds. |
# of Other Accounts Managed and Total Assets by Account Type | ||||||||||||
Registered Investment Companies | Other Pooled Investment Vehicles | Other Accounts | ||||||||||
Name of Portfolio Manager | Number of Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | ||||||
Len Ioffe | 38 | $27,427 | 31 | $15,619 | 37 | $9,061 | ||||||
Osman Ali | 38 | $27,427 | 31 | $15,619 | 37 | $9,061 | ||||||
Takashi Suwabe | 16 | $11,416 | 20 | $ 9,727 | 24 | $6,700 |
# Accounts & Total Assets for Which Advisory Fee is Performance Based | ||||||||||||
Registered Investment Companies | Other Pooled Investment Vehicles | Other Accounts | ||||||||||
Name of Portfolio Manager | Number of Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | ||||||
Len Ioffe | 0 | $0 | 0 | $0 | 4 | $1,558 |
# Accounts & Total Assets for Which Advisory Fee is Performance Based | ||||||||||||
Registered Investment Companies | Other Pooled Investment Vehicles | Other Accounts | ||||||||||
Name of Portfolio Manager | Number of Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | Number Accounts | Assets Managed (in millions) | ||||||
Osman Ali | 0 | $0 | 0 | $0 | 4 | $1,558 | ||||||
Takashi Suwabe | 0 | $0 | 0 | $0 | 4 | $1,558 |
Portfolio Manager | Type of Accounts | Total # of Accounts Managed | Total Assets in the Accounts (in millions) | # of Accounts Managed with Advisory Fee Based on Performance | Total Assets with Advisory Fee Based on Performance (in millions) | |||||
Hugh Young | Registered Investment Companies: | 15 | $ 8,902.36 | 0 | $0 | |||||
Other Pooled Investment Vehicles: | 82 | $31,129.80 | 0 | $0 | ||||||
Other Accounts: | 74 | $22,044.86 | 0 | $0 | ||||||
Devan Kaloo | Registered Investment Companies: | 9 | $ 7,978.88 | 0 | $0 | |||||
Other Pooled Investment Vehicles: | 24 | $11,335.90 | 0 | $0 | ||||||
Other Accounts: | 25 | $ 8,801.48 | 0 | $0 | ||||||
Joanne Irvine | Registered Investment Companies: | 9 | $ 7,978.88 | 0 | $0 | |||||
Other Pooled Investment Vehicles: | 24 | $11,335.90 | 0 | $0 | ||||||
Other Accounts: | 25 | $ 8,801.48 | 0 | $0 | ||||||
Mark Gordon-James | Registered Investment Companies: | 9 | $ 7,978.88 | 0 | $0 | |||||
Other Pooled Investment Vehicles: | 24 | $11,335.90 | 0 | $0 | ||||||
Other Accounts: | 25 | $ 8,801.48 | 0 | $0 | ||||||
Flavia Cheong | Registered Investment Companies: | 15 | $ 8,902.36 | 0 | $0 | |||||
Other Pooled Investment Vehicles: | 82 | $31,129.80 | 0 | $0 | ||||||
Other Accounts: | 74 | $22,044.86 | 0 | $0 |
Total # of Accounts Managed | Total Assets (in millions) | |||
Joseph B. Fath | Registered investment companies: | 13 | $79,021.54 | |
Other pooled investment vehicles: | 6 | $18,348.51 | ||
Other accounts: | 8 | $ 2,639.86 |
Portfolio Manager | Type of Accounts | Total # of Accounts Managed | Total Assets (in $ millions) | # of Accounts Managed with Advisory Fee Based on Performance | Total Assets with Advisory Fee Based on Performance (in $ millions) | |||||
Erin Xie | Other Registered Investment Companies: | 3 | $8,730 | 0 | $ 0 | |||||
Other Pooled Investment Vehicles: | 2 | $5,570 | 0 | $ 0 | ||||||
Other Accounts: | 1 | $1,450 | 1 | $1,450 |
Affiliated Person | Position with Fund | Position with Thrivent Financial | ||
David S. Royal | Trustee, President and Chief Investment Officer | Senior Vice President, Chief Investment Officer | ||
Gerard V. Vaillancourt | Treasurer and Principal Accounting Officer | Vice President and Mutual Funds Chief Financial Officer | ||
Michael W. Kremenak | Secretary and Chief Legal Officer | Vice President, Chief Legal Officer | ||
Edward S. Dryden | Chief Compliance Officer | Vice President, Chief Compliance Officer – Thrivent Funds | ||
Kathleen M. Koelling | Privacy Officer | Vice President, Deputy General Counsel | ||
Sharon K. Minta | Anti-Money Laundering Officer | Director, Compliance and Anti-Money Laundering Officer | ||
Troy A. Beaver | Vice President | Vice President, Mutual Funds Marketing & Distribution | ||
Monica L. Kleve | Vice President | Vice President, Investment Operations | ||
Kathryn A. Stelter | Vice President | Vice President, Mutual Funds Chief Operations Officer | ||
Jill M. Forte | Assistant Secretary | Senior Counsel | ||
John D. Jackson | Assistant Secretary | Senior Counsel | ||
Sarah L. Bergstrom | Assistant Treasurer | Head of Mutual Fund Accounting |
Thrivent Aggressive Allocation Portfolio | |
Portfolio assets invested in all asset types (including Thrivent mutual funds) | |
First $5 billion: | 0.700% |
Next $5 billion: | 0.675% |
Over $10 billion: | 0.650% |
Thrivent All Cap Portfolio | |
First $250 million: | 0.550% |
Over $250 million: | 0.500% |
Thrivent Balanced Income Plus Portfolio | |
First $500 million: | 0.550% |
Next $500 million: | 0.500% |
Next $1.5 billion: | 0.475% |
Next $2.5 billion: | 0.450% |
Over $5 billion: | 0.425% |
Thrivent Diversified Income Plus Portfolio | |
All assets: | 0.400% |
Thrivent ESG Index Portfolio | |
First $1.5 billion: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent Global Stock Portfolio | |
First $500 million: | 0.650% |
Next $250 million: | 0.575% |
Next $250 million: | 0.550% |
Next $1.5 billion: | 0.475% |
Next $2.5 billion: | 0.450% |
Over $5 billion: | 0.425% |
Thrivent Government Bond Portfolio | |
First $250 million: | 0.350% |
Next $250 million: | 0.300% |
Next $500 million: | 0.250% |
Next $500 million: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent High Yield Portfolio | |
All assets: | 0.400% |
Thrivent Income Portfolio | |
All assets: | 0.400% |
Thrivent International Allocation Portfolio | |
First $250 million: | 0.700% |
Next $750 million: | 0.650% |
Next $500 million: | 0.625% |
Over $1.5 billion: | 0.600% |
Thrivent International Index Portfolio | |
First $1.5 billion: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent Large Cap Growth Portfolio | |
All assets: | 0.400% |
Thrivent Large Cap Index Portfolio | |
First $1.5 billion: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent Large Cap Value Portfolio | |
All assets: | 0.600% |
Thrivent Limited Maturity Bond Portfolio | |
All assets: | 0.400% |
Thrivent Low Volatility Equity Portfolio | |
First $100 million: | 0.600% |
Over $100 million | 0.500% |
Thrivent Mid Cap Growth Portfolio | |
First $200 million: | 0.750% |
Over $200 million | 0.700% |
Thrivent Mid Cap Index Portfolio | |
First $1.5 billion: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent Mid Cap Stock Portfolio | |
First $200 million: | 0.700% |
Next $800 million: | 0.650% |
Next $1.5 billion: | 0.600% |
Next $2.5 billion: | 0.550% |
Over $5 billion: | 0.525% |
Thrivent Mid Cap Value Portfolio | |
First $200 million: | 0.750% |
Over $200 million | 0.700% |
Thrivent Moderate Allocation Portfolio | |
Portfolio assets invested in all asset types (including Thrivent mutual funds) | |
First $500 million: | 0.650% |
Next $1.5 billion: | 0.625% |
Next $3 billion: | 0.600% |
Next $5 billion: | 0.575% |
Over $10 billion: | 0.550% |
Thrivent Moderately Aggressive Allocation Portfolio | |
Portfolio assets invested in all asset types (including Thrivent mutual funds) | |
First $500 million: | 0.700% |
Next $1.5 billion: | 0.675% |
Next $3 billion: | 0.650% |
Next $5 billion: | 0.625% |
Over $10 billion: | 0.600% |
Thrivent Moderately Conservative Allocation Portfolio | |
Portfolio assets invested in all asset types (including Thrivent mutual funds) | |
First $500 million: | 0.600% |
Next $1.5 billion: | 0.575% |
Next $3 billion: | 0.550% |
Next $5 billion: | 0.525% |
Over $10 billion: | 0.500% |
Thrivent Money Market Portfolio | |
All assets: | 0.350% |
Thrivent Multidimensional Income Portfolio | |
First $100 million: | 0.550% |
Over $100 million | 0.500% |
Thrivent Opportunity Income Plus Portfolio | |
First $500 million: | 0.500% |
Over $500 million | 0.450% |
Thrivent Partner Emerging Markets Equity Portfolio | |
First $100 million: | 0.950% |
Next $150 million: | 0.900% |
Over $250 million: | 0.850% |
Thrivent Partner Growth Stock Portfolio | |
First $250 million: | 0.650% |
Next $250 million: | 0.625% |
Next $500 million: | 0.600% |
Over $1 billion: | 0.550% |
Thrivent Partner Healthcare Portfolio | |
First $50 million: | 0.900% |
Next $50 million: | 0.850% |
Next $150 million: | 0.800% |
Over $250 million: | 0.750% |
Thrivent Real Estate Securities Portfolio | |
First $500 million: | 0.750% |
Over $500 million: | 0.700% |
Thrivent Small Cap Growth Portfolio | |
First $200 million: | 0.800% |
Over $200 million: | 0.750% |
Thrivent Small Cap Index Portfolio | |
First $1.5 billion: | 0.200% |
Next $500 million: | 0.150% |
Over $2 billion: | 0.100% |
Thrivent Small Cap Stock Portfolio | |
First $200 million: | 0.700% |
Next $800 million: | 0.650% |
Next $1.5 billion: | 0.600% |
Next $2.5 billion: | 0.550% |
Over $5 billion: | 0.525% |
Portfolio | Percentage | Expiration Date | ||
Thrivent Partner Healthcare Portfolio | 0.05% | 4/30/2021 |
Portfolio | Percentage | Expiration Date | ||
Thrivent ESG Index Portfolio | 0.38% | 4/30/2021 | ||
Thrivent International Index Portfolio | 0.46% | 4/30/2021 | ||
Thrivent Low Volatility Equity Portfolio | 0.80% | 4/30/2021 | ||
Thrivent Mid Cap Growth Portfolio | 0.85% | 4/30/2021 | ||
Thrivent Mid Cap Value Portfolio | 0.90% | 4/30/2021 | ||
Thrivent Multidimensional Income Portfolio | 0.95% | 4/30/2021 | ||
Thrivent Partner Emerging Markets Equity Portfolio | 1.20% | 4/30/2021 | ||
Thrivent Small Cap Growth Portfolio | 0.94% | 4/30/2021 |
Portfolio | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Aggressive Allocation Portfolio | $10,101,195 | $ 9,573,526 | $ 8,768,803 | |||
Thrivent All Cap Portfolio | $ 654,344 | $ 721,044 | $ 677,183 | |||
Thrivent Balanced Income Plus Portfolio | $ 2,312,711 | $ 2,239,107 | $ 2,100,471 | |||
Thrivent Diversified Income Plus Portfolio | $ 3,030,347 | $ 2,784,395 | $ 2,494,954 | |||
Thrivent Global Stock Portfolio | $ 6,541,296 | $ 6,558,929 | $ 6,067,158 | |||
Thrivent Government Bond Portfolio | $ 639,364 | $ 649,930 | $ 698,202 | |||
Thrivent High Yield Portfolio | $ 3,434,578 | $ 3,344,156 | $ 3,308,084 | |||
Thrivent Income Portfolio | $ 6,332,859 | $ 5,918,136 | $ 5,919,225 | |||
Thrivent International Allocation Portfolio | $12,339,943 | $15,109,720 | $15,525,433 | |||
Thrivent Large Cap Growth Portfolio | $ 5,513,779 | $ 5,212,138 | $ 4,478,380 | |||
Thrivent Large Cap Index Portfolio | $ 2,191,506 | $ 1,992,231 | $ 1,645,417 | |||
Thrivent Large Cap Value Portfolio | $ 9,690,499 | $ 9,549,386 | $ 8,634,319 | |||
Thrivent Limited Maturity Bond Portfolio | $ 3,692,041 | $ 3,608,277 | $ 3,582,598 | |||
Thrivent Low Volatility Equity Portfolio | $ 182,434 | $ 105,170 | $ 27,710 | |||
Thrivent Mid Cap Index Portfolio | $ 899,123 | $ 834,848 | $ 684,790 | |||
Thrivent Mid Cap Stock Portfolio | $11,385,458 | $11,238,642 | $10,206,832 | |||
Thrivent Moderate Allocation Portfolio | $59,820,978 | $59,767,878 | $57,967,078 | |||
Thrivent Moderately Aggressive Allocation Portfolio | $41,993,911 | $41,039,912 | $37,891,706 | |||
Thrivent Moderately Conservative Allocation Portfolio | $28,880,736 | $28,475,711 | $27,809,161 | |||
Thrivent Money Market Portfolio | $ 646,074 | $ 550,753 | $ 622,284 | |||
Thrivent Multidimensional Income Portfolio | $ 117,659 | $ 107,401 | $ 75,063 | |||
Thrivent Opportunity Income Plus Portfolio | $ 971,471 | $ 885,243 | $ 795,090 | |||
Thrivent Partner Emerging Markets Equity Portfolio | $ 860,332 | $ 909,499 | $ 871,252 | |||
Thrivent Partner Growth Stock Portfolio | $ 1,587,442 | $ 1,398,680 | $ 981,757 | |||
Thrivent Partner Healthcare Portfolio | $ 1,851,338 | $ 1,713,918 | $ 1,660,943 | |||
Thrivent Real Estate Securities Portfolio | $ 1,408,619 | $ 1,289,059 | $ 1,466,578 | |||
Thrivent Small Cap Growth Portfolio | $ 137,406 | $ 40,712 | $ N/A | |||
Thrivent Small Cap Index Portfolio | $ 1,162,847 | $ 1,084,990 | $ 885,500 | |||
Thrivent Small Cap Stock Portfolio | $ 3,949,139 | $ 3,995,912 | $ 3,684,079 |
Portfolio | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Aggressive Allocation Portfolio | $ 2,492,017 | $ 2,612,611 | $ 2,468,096 | |||
Thrivent All Cap Portfolio | $ – | $ — | $ — | |||
Thrivent Balanced Income Plus Portfolio | $ – | $ — | $ — | |||
Thrivent Diversified Income Plus Portfolio | $ – | $ — | $ — | |||
Thrivent Global Stock Portfolio | $ – | $ — | $ — | |||
Thrivent Government Bond Portfolio | $ – | $ — | $ — | |||
Thrivent High Yield Portfolio | $ – | $ — | $ — | |||
Thrivent Income Portfolio | $ – | $ — | $ — |
Portfolio | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent International Allocation Portfolio | $ – | $ — | $ 735,827 | |||
Thrivent Large Cap Growth Portfolio | $ – | $ — | $ — | |||
Thrivent Large Cap Index Portfolio | $ – | $ — | $ — | |||
Thrivent Large Cap Value Portfolio | $ – | $ — | $ — | |||
Thrivent Limited Maturity Bond Portfolio | $ – | $ — | $ — | |||
Thrivent Low Volatility Equity Portfolio | $ 109,157 | $ 119,474 | $ 110,796 | |||
Thrivent Mid Cap Index Portfolio | $ – | $ — | $ — | |||
Thrivent Mid Cap Stock Portfolio | $ – | $ — | $ — | |||
Thrivent Moderate Allocation Portfolio | $16,881,764 | $17,468,458 | $16,779,943 | |||
Thrivent Moderately Aggressive Allocation Portfolio | $13,401,442 | $13,836,742 | $13,091,675 | |||
Thrivent Moderately Conservative Allocation Portfolio | $ 6,560,774 | $ 6,548,578 | $ 6,278,826 | |||
Thrivent Money Market Portfolio | $ – | $ — | $ — | |||
Thrivent Multidimensional Income Portfolio | $ 101,363 | $ 89,679 | $ 66,766 | |||
Thrivent Opportunity Income Plus Portfolio | $ – | $ — | $ — | |||
Thrivent Partner Emerging Markets Equity Portfolio | $ 104,830 | $ 51,815 | $ 175,203 | |||
Thrivent Partner Growth Stock Portfolio | $ – | $ — | $ — | |||
Thrivent Partner Healthcare Portfolio | $ 118,011 | $ 114,032 | $ 151,436 | |||
Thrivent Real Estate Securities Portfolio | $ – | $ — | $ — | |||
Thrivent Small Cap Growth Portfolio | $ 128,043 | $ 102,193 | N/A | |||
Thrivent Small Cap Index Portfolio | $ – | $ — | $ — | |||
Thrivent Small Cap Stock Portfolio | $ – | $ — | $ — |
Affiliated Person | Position with Fund | Position with Thrivent Distributors | ||
David S. Royal | Director, President and Chief Investment Officer | Elected Manager | ||
Gerard V. Vaillancourt | Treasurer and Principal Accounting Officer | Elected Manager and Vice President | ||
Michael W. Kremenak | Secretary and Chief Legal Officer | Assistant Secretary | ||
Edward S. Dryden | Chief Compliance Officer | Chief Compliance Officer | ||
Troy A. Beaver | Vice President | Chief Executive Officer | ||
Kathryn A. Stelter | Vice President | Chief Operations Officer | ||
John D. Jackson | Assistant Secretary | Secretary and Chief Legal Officer |
Fund | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Aggressive Allocation Portfolio | $ 335,315 | $ 339,851 | $ 306,527 | |||
Thrivent All Cap Portfolio | 109,135 | 101,077 | 99,795 | |||
Thrivent Balanced Income Plus Portfolio | 161,484 | 157,351 | 152,562 | |||
Thrivent Diversified Income Plus Portfolio | 218,790 | 212,259 | 198,510 | |||
Thrivent Global Stock Portfolio | 277,142 | 289,897 | 270,715 | |||
Thrivent Government Bond Portfolio | 121,055 | 115,282 | 117,902 | |||
Thrivent High Yield Portfolio | 235,969 | 238,847 | 237,134 | |||
Thrivent Income Portfolio | 359,146 | 361,112 | 361,163 | |||
Thrivent International Allocation Portfolio | 394,084 | 443,780 | 438,478 | |||
Thrivent Large Cap Growth Portfolio | 324,336 | 327,577 | 292,723 | |||
Thrivent Large Cap Index Portfolio | 276,278 | 269,262 | 236,315 | |||
Thrivent Large Cap Value Portfolio | 364,564 | 382,397 | 353,420 | |||
Thrivent Limited Maturity Bond Portfolio | 246,912 | 251,393 | 250,173 | |||
Thrivent Low Volatility Equity Portfolio | 95,169 | 83,330 | 54,211 | |||
Thrivent Mid Cap Index Portfolio | 166,425 | 159,310 | 145,055 | |||
Thrivent Mid Cap Stock Portfolio | 395,588 | 416,890 | 384,216 | |||
Thrivent Moderate Allocation Portfolio | 1,804,193 | 1,994,253 | 1,933,629 | |||
Thrivent Moderately Aggressive Allocation Portfolio | 1,181,234 | 1,270,613 | 1,174,908 | |||
Thrivent Moderately Conservative Allocation Portfolio | 964,543 | 1,042,864 | 1,019,314 | |||
Thrivent Money Market Portfolio | 121,381 | 109,898 | 113,781 | |||
Thrivent Multidimensional Income Portfolio | 93,637 | 83,710 | 55,926 | |||
Thrivent Opportunity Income Plus Portfolio | 123,030 | 113,639 | 110,213 | |||
Thrivent Partner Emerging Markets Equity Portfolio | 105,098 | 97,690 | 94,317 | |||
Thrivent Partner Growth Stock Portfolio | 131,529 | 120,884 | 108,698 | |||
Thrivent Partner Healthcare Portfolio | 127,747 | 118,924 | 115,450 | |||
Thrivent Real Estate Securities Portfolio | 121,929 | 112,656 | 114,831 | |||
Thrivent Small Cap Growth Portfolio | 92,920 | 54,300 | N/A |
Fund | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Small Cap Index Portfolio | 188,842 | 183,074 | 164,123 | |||
Thrivent Small Cap Stock Portfolio | 190,669 | 193,880 | 184,765 |
Gross Income from Securities Lending Activities | Fees Paid to Securities Lending Agent from a Revenue Split | Fees Paid for any Cash Collateral Management Service (Including Fees Deducted from a Pooled Cash Collateral Reinvestment Vehicle) that are not Included in the Revenue Split | Administrative Fees not Iincluded in the Revenue Split | Indemnification Fee not Included in the Revenue Split | Rebates (Paid to Borrower) | Other Fees not Included in the Revenue Split | Aggregate Fees/ Compensation for Securities Lending Activities | Net Income from Securities Lending Activities | ||||||||
Thrivent Aggressive Allocation Portfolio | ||||||||||||||||
$ 285,624 | $ 5,088 | $- | $- | $- | $235,489 | $- | $240,577 | $ 45,047 | ||||||||
Thrivent All Cap Portfolio | ||||||||||||||||
$ 6,392 | $ 40 | $- | $- | $- | $ 5,989 | $- | $ 6,029 | $ 363 | ||||||||
Thrivent Balanced Income Plus Portfolio | ||||||||||||||||
$ 86,117 | $ 3,225 | $- | $- | $- | $ 54,541 | $- | $ 57,766 | $ 28,351 | ||||||||
Thrivent Diversified Income Plus Portfolio | ||||||||||||||||
$ 150,911 | $ 5,329 | $- | $- | $- | $ 98,545 | $- | $103,874 | $ 47,037 | ||||||||
Thrivent Global Stock Portfolio | ||||||||||||||||
$ 175,339 | $11,211 | $- | $- | $- | $ 63,230 | $- | $ 74,441 | $100,898 |
Gross Income from Securities Lending Activities | Fees Paid to Securities Lending Agent from a Revenue Split | Fees Paid for any Cash Collateral Management Service (Including Fees Deducted from a Pooled Cash Collateral Reinvestment Vehicle) that are not Included in the Revenue Split | Administrative Fees not Iincluded in the Revenue Split | Indemnification Fee not Included in the Revenue Split | Rebates (Paid to Borrower) | Other Fees not Included in the Revenue Split | Aggregate Fees/ Compensation for Securities Lending Activities | Net Income from Securities Lending Activities | ||||||||
Thrivent Government Bond Portfolio | ||||||||||||||||
$ 3,877 | $ 97 | $- | $- | $- | $ 2,907 | $- | $ 3,004 | $ 873 | ||||||||
Thrivent High Yield Portfolio | ||||||||||||||||
$ 958,417 | $37,868 | $- | $- | $- | $579,749 | $- | $617,617 | $340,800 | ||||||||
Thrivent Income Portfolio | ||||||||||||||||
$ 190,201 | $ 4,250 | $- | $- | $- | $147,712 | $- | $151,962 | $ 38,239 | ||||||||
Thrivent International Allocation Portfolio | ||||||||||||||||
$ 625,771 | $44,629 | $- | $- | $- | $175,509 | $- | $220,138 | $405,633 | ||||||||
Thrivent Large Cap Growth Portfolio | ||||||||||||||||
$ 31,945 | $ 598 | $- | $- | $- | $ 25,956 | $- | $ 26,554 | $ 5,391 | ||||||||
Thrivent Large Cap Index Portfolio | ||||||||||||||||
$ 71,566 | $ 4,706 | $- | $- | $- | $ 26,968 | $- | $ 31,674 | $ 39,892 | ||||||||
Thrivent Large Cap Value Portfolio | ||||||||||||||||
$ 20,570 | $ 245 | $- | $- | $- | $ 18,100 | $- | $ 18,345 | $ 2,225 | ||||||||
Thrivent Limited Maturity Bond Portfolio | ||||||||||||||||
$ 15,154 | $ 215 | $- | $- | $- | $ 13,005 | $- | $ 13,220 | $ 1,934 | ||||||||
Thrivent Low Volatility Equity Portfolio | ||||||||||||||||
$ 3,266 | $ 305 | $- | $- | $- | $ 219 | $- | $ 524 | $ 2,742 | ||||||||
Thrivent Mid Cap Index Portfolio | ||||||||||||||||
$ 239,368 | $ 5,723 | $- | $- | $- | $182,092 | $- | $187,815 | $ 51,553 | ||||||||
Thrivent Mid Cap Stock Portfolio | ||||||||||||||||
$ 800,853 | $ 8,252 | $- | $- | $- | $718,195 | $- | $726,447 | $ 74,406 | ||||||||
Thrivent Moderate Allocation Portfolio | ||||||||||||||||
$1,002,967 | $22,263 | $- | $- | $- | $784,466 | $- | $806,729 | $196,238 | ||||||||
Thrivent Moderately Aggressive Allocation Portfolio | ||||||||||||||||
$ 837,761 | $17,835 | $- | $- | $- | $661,623 | $- | $679,458 | $158,303 | ||||||||
Thrivent Moderately Conservative Allocation Portfolio | ||||||||||||||||
$ 362,993 | $ 6,847 | $- | $- | $- | $295,984 | $- | $302,831 | $ 60,162 |
Gross Income from Securities Lending Activities | Fees Paid to Securities Lending Agent from a Revenue Split | Fees Paid for any Cash Collateral Management Service (Including Fees Deducted from a Pooled Cash Collateral Reinvestment Vehicle) that are not Included in the Revenue Split | Administrative Fees not Iincluded in the Revenue Split | Indemnification Fee not Included in the Revenue Split | Rebates (Paid to Borrower) | Other Fees not Included in the Revenue Split | Aggregate Fees/ Compensation for Securities Lending Activities | Net Income from Securities Lending Activities | ||||||||
Thrivent Multidimensional Income Portfolio | ||||||||||||||||
$ 1,951 | $ 74 | $- | $- | $- | $ 1,205 | $- | $ 1,279 | $ 672 | ||||||||
Thrivent Opportunity Income Plus Portfolio | ||||||||||||||||
$ 15,488 | $ 415 | $- | $- | $- | $ 11,334 | $- | $ 11,749 | $ 3,739 | ||||||||
Thrivent Partner Emerging Markets Equity Portfolio | ||||||||||||||||
$ 7,304 | $ 37 | $- | $- | $- | $ 6,932 | $- | $ 6,969 | $ 335 | ||||||||
Thrivent Partner Growth Stock Portfolio | ||||||||||||||||
$ 8,969 | $ 63 | $- | $- | $- | $ 8,346 | $- | $ 8,409 | $ 560 | ||||||||
Thrivent Partner Healthcare Portfolio | ||||||||||||||||
$ 87,526 | $ 6,836 | $- | $- | $- | $ 19,158 | $- | $ 25,994 | $ 61,532 | ||||||||
Thrivent Small Cap Growth Portfolio | ||||||||||||||||
$ 4,363 | $ 151 | $- | $- | $- | $ 2,846 | $- | $ 2,997 | $ 1,366 | ||||||||
Thrivent Small Cap Index Portfolio | ||||||||||||||||
$ 565,407 | $17,428 | $- | $- | $- | $390,540 | $- | $407,968 | $157,439 | ||||||||
Thrivent Small Cap Stock Portfolio | ||||||||||||||||
$ 468,807 | $ 6,690 | $- | $- | $- | $401,869 | $- | $408,559 | $ 60,248 |
Fund | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Aggressive Allocation Portfolio | $ 591,382 | $ 609,684 | $ 651,876 | |||
Thrivent All Cap Portfolio | $ 131,148 | $ 30,061 | $ 30,255 | |||
Thrivent Balanced Income Plus Portfolio | $ 154,738 | $ 234,320 | $ 232,952 | |||
Thrivent Diversified Income Plus Portfolio | $ 171,776 | $ 229,247 | $ 239,915 | |||
Thrivent Global Stock Portfolio | $ 947,346 | $ 797,309 | $ 887,621 | |||
Thrivent Government Bond Portfolio | $ 9,333 | $ 3,529 | $ 5,080 | |||
Thrivent High Yield Portfolio | $ 1,748 | $ 12 | $ 512 | |||
Thrivent Income Portfolio | $ 36,598 | $ 62,003 | $ 49,874 | |||
Thrivent International Allocation Portfolio | $2,683,789 | $1,597,023 | $2,108,907 | |||
Thrivent Large Cap Growth Portfolio | $ 403,982 | $ 592,175 | $ 540,864 | |||
Thrivent Large Cap Index Portfolio | $ 10,965 | $ 15,639 | $ 55,193 | |||
Thrivent Large Cap Value Portfolio | $ 354,163 | $ 351,836 | $ 308,624 | |||
Thrivent Limited Maturity Bond Portfolio | $ 54,048 | $ 45,272 | $ 54,063 | |||
Thrivent Low Volatility Equity Portfolio | $ 28,059 | $ 18,074 | $ 7,969 | |||
Thrivent Mid Cap Index Portfolio | $ 2,955 | $ 19,436 | $ 50,615 | |||
Thrivent Mid Cap Stock Portfolio | $ 846,268 | $ 720,031 | $ 626,013 | |||
Thrivent Moderate Allocation Portfolio | $2,653,800 | $2,943,425 | $4,020,085 | |||
Thrivent Moderately Aggressive Allocation Portfolio | $2,074,956 | $2,078,491 | $2,754,932 | |||
Thrivent Moderately Conservative Allocation Portfolio | $ 887,695 | $ 918,226 | $1,183,987 | |||
Thrivent Money Market Portfolio | $ — | $ — | $ — | |||
Thrivent Multidimensional Income Portfolio | $ 11,177 | $ 4,173 | $ 14,560 | |||
Thrivent Opportunity Income Plus Portfolio | $ 7,703 | $ 8,030 | $ 19,687 | |||
Thrivent Partner Emerging Markets Equity Portfolio | $ 37,846 | $ 24,462 | $ 32,493 | |||
Thrivent Partner Growth Stock Portfolio | $ 26,179 | $ 36,557 | $ 38,622 | |||
Thrivent Partner Healthcare Portfolio | $ 61,711 | $ 42,079 | $ 611,146 | |||
Thrivent Real Estate Securities Portfolio | $ 41,246 | $ 62,755 | $ 23,756 | |||
Thrivent Small Cap Growth Portfolio | $ 14,226 | $ 8,039 | $ — | |||
Thrivent Small Cap Index Portfolio | $ 38,514 | $ 64,242 | $ 74,320 |
Fund | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Small Cap Stock Portfolio | $ 486,891 | $ 543,925 | $ 380,959 |
Fund Name | Commissions | Aggregrate Transactions | ||
Thrivent Aggressive Allocation Portfolio | $ 591,382 | $ 873,449,235 | ||
Thrivent All Cap Portfolio | $ 130,686 | $ 280,911,431 | ||
Thrivent Balanced Income Plus Portfolio | $ 154,738 | $ 239,224,212 | ||
Thrivent Diversified Income Plus Portfolio | $ 171,776 | $ 243,967,121 | ||
Thrivent Global Stock Portfolio | $ 947,346 | $1,543,141,775 | ||
Thrivent Government Bond Portfolio | $ 9,333 | $ 9,333 | ||
Thrivent High Yield Portfolio | $ 1,748 | $ 3,604,695 | ||
Thrivent Income Portfolio | $ 36,598 | $ 83,931,049 | ||
Thrivent International Allocation Portfolio | $2,518,706 | $2,500,960,668 | ||
Thrivent Large Cap Growth Portfolio | $ 403,982 | $1,635,877,658 | ||
Thrivent Large Cap Index Portfolio | $ 10,965 | $ 12,885,337 | ||
Thrivent Large Cap Value Portfolio | $ 354,163 | $ 634,533,513 | ||
Thrivent Limited Maturity Bond Portfolio | $ 54,048 | $ 19,905,574 | ||
Thrivent Low Volatility Equity Portfolio | $ 28,059 | $ 45,928,096 | ||
Thrivent Mid Cap Index Portfolio | $ 2,955 | $ 1,787,737 | ||
Thrivent Mid Cap Stock Portfolio | $ 846,268 | $1,222,105,011 | ||
Thrivent Moderate Allocation Portfolio | $2,653,800 | $3,712,357,778 | ||
Thrivent Moderately Aggressive Allocation Portfolio | $2,074,956 | $3,181,764,335 | ||
Thrivent Moderately Conservative Allocation Portfolio | $ 887,695 | $1,243,814,395 | ||
Thrivent Money Market Portfolio | $ — | $ — | ||
Thrivent Multidimensional Income Portfolio | $ 11,177 | $ 12,448,370 | ||
Thrivent Opportunity Income Plus Portfolio | $ 7,703 | $ 7,169,094 | ||
Thrivent Partner Emerging Markets Equity Portfolio | $ 9,140 | $ 3,141,767 | ||
Thrivent Partner Growth Stock Portfolio | $ 26,179 | $ 137,734,390 | ||
Thrivent Partner Healthcare Portfolio | $ 61,711 | $ 195,256,906 | ||
Thrivent Real Estate Securities Portfolio | $ 41,246 | $ 79,434,905 | ||
Thrivent Small Cap Growth Portfolio | $ 14,226 | $ 24,165,838 | ||
Thrivent Small Cap Index Portfolio | $ 38,514 | $ 152,278,932 | ||
Thrivent Small Cap Stock Portfolio | $ 486,891 | $ 610,758,632 |
Funds | Regular Broker or Dealer (or Parent) | Aggregate Holdings | ||
Thrivent Aggressive Allocation Portfolio | Bank of America Corporation | $ 6,076,824 | ||
Citigroup, Inc. | $ 4,289,694 |
Funds | Regular Broker or Dealer (or Parent) | Aggregate Holdings | ||
Morgan Stanley Dean Witter & Company | $ 4,152,545 | |||
J.P. Morgan | $ 2,288,211 | |||
Goldman, Sachs & Company | $ 546,774 | |||
UBS AG | $ 6,175 | |||
Thrivent All Cap Portfolio | J.P. Morgan | $ 1,505,520 | ||
Thrivent Balanced Income Plus Portfolio | Bank of America Corporation | $ 5,853,278 | ||
J.P. Morgan | $ 3,255,748 | |||
Citigroup, Inc. | $ 2,769,858 | |||
Goldman, Sachs & Company | $ 2,115,522 | |||
Wells Fargo | $ 1,598,833 | |||
Morgan Stanley Dean Witter & Company | $ 987,532 | |||
Credit Suisse Group AG | $ 663,288 | |||
Deutsche Bank | $ 602,457 | |||
Barclays | $ 371,718 | |||
UBS AG | $ 298,542 | |||
Thrivent Diversified Income Plus Portfolio | Bank of America Corporation | $15,585,875 | ||
J.P. Morgan | $10,123,736 | |||
Citigroup, Inc. | $ 5,852,892 | |||
Goldman, Sachs & Company | $ 4,770,420 | |||
Wells Fargo | $ 4,246,116 | |||
Credit Suisse Group AG | $ 1,914,980 | |||
Morgan Stanley Dean Witter & Company | $ 1,913,435 | |||
Deutsche Bank | $ 1,531,517 | |||
Barclays | $ 1,433,830 | |||
UBS AG | $ 643,549 | |||
Mizuho Securities | $ 164,881 | |||
Thrivent Global Stock Portfolio | Citigroup, Inc. | $ 7,334,541 | ||
Morgan Stanley Dean Witter & Company | $ 5,504,116 | |||
J.P. Morgan | $ 3,221,395 | |||
Goldman, Sachs & Company | $ 933,056 | |||
Thrivent Government Bond Portfolio | Wells Fargo | $ 326,249 | ||
Morgan Stanley Dean Witter & Company | $ 318,875 | |||
Thrivent High Yield Portfolio | Bank of America Corporation | $ 2,424,975 | ||
Thrivent Income Portfolio | Bank of America Corporation | $35,532,921 | ||
J.P. Morgan | $30,614,082 | |||
Citigroup, Inc. | $24,772,956 | |||
Goldman, Sachs & Company | $24,431,609 | |||
Morgan Stanley Dean Witter & Company | $15,980,971 | |||
HSBC Securities | $13,312,670 | |||
Credit Suisse Group AG | $11,733,233 | |||
Barclays | $10,523,955 | |||
Wells Fargo | $ 9,626,515 |
Funds | Regular Broker or Dealer (or Parent) | Aggregate Holdings | ||
Mizuho Securities | $ 2,716,489 | |||
Thrivent International Allocation Portfolio | Morgan Stanley Dean Witter & Company | $ 1,161,996 | ||
Thrivent Large Cap Index Portfolio | J.P. Morgan | $19,928,206 | ||
Citigroup, Inc. | $ 7,949,614 | |||
Goldman, Sachs & Company | $ 3,339,733 | |||
Morgan Stanley Dean Witter & Company | $ 2,938,966 | |||
BNY Mellon | $ 1,925,123 | |||
Thrivent Large Cap Value Portfolio | Raymond James & Associates | $18,374,189 | ||
Thrivent Limited Maturity Bond Portfolio | Bank of America Corporation | $19,832,427 | ||
J.P. Morgan | $ 9,697,070 | |||
Morgan Stanley Dean Witter & Company | $ 6,332,509 | |||
Goldman, Sachs & Company | $ 6,082,470 | |||
Wells Fargo | $ 5,476,795 | |||
Citigroup, Inc. | $ 5,250,031 | |||
Barclays | $ 4,308,484 | |||
Mizuho Securities | $ 3,720,826 | |||
Credit Suisse Group AG | $ 2,783,138 | |||
Thrivent Low Volatility Equity Portfolio | Morgan Stanley Dean Witter & Company | $ 5,082 | ||
Thrivent Mid Cap Index Portfolio | Morgan Stanley Dean Witter & Company | $ 177,918 | ||
Thrivent Mid Cap Stock Portfolio | Keybanc Capital Markets | $46,092,552 | ||
Thrivent Moderate Allocation Portfolio | Bank of America Corporation | $41,834,931 | ||
Citigroup, Inc. | $35,211,292 | |||
Goldman, Sachs & Company | $28,191,406 | |||
J.P. Morgan | $26,412,447 | |||
Morgan Stanley Dean Witter & Company | $15,446,940 | |||
Wells Fargo | $15,437,253 | |||
UBS AG | $11,551,163 | |||
Credit Suisse Group AG | $10,515,239 | |||
Deutsche Bank | $ 9,843,223 | |||
Barclays | $ 4,595,233 | |||
Thrivent Moderately Aggressive Allocation Portfolio | Bank of America Corporation | $18,521,663 | ||
Citigroup, Inc. | $13,451,917 | |||
Morgan Stanley Dean Witter & Company | $12,006,764 | |||
Goldman, Sachs & Company | $10,786,574 | |||
J.P. Morgan | $10,651,892 | |||
Wells Fargo | $ 5,111,829 | |||
UBS AG | $ 4,586,277 | |||
Credit Suisse Group AG | $ 4,165,251 | |||
Deutsche Bank | $ 3,567,663 | |||
Barclays | $ 2,144,431 |
Funds | Regular Broker or Dealer (or Parent) | Aggregate Holdings | ||
Thrivent Moderately Conservative Allocation Portfolio | Bank of America Corporation | $27,683,455 | ||
Citigroup, Inc. | $25,899,852 | |||
Goldman, Sachs & Company | $20,912,309 | |||
J.P. Morgan | $15,525,542 | |||
Wells Fargo | $11,595,235 | |||
UBS AG | $ 8,177,732 | |||
Credit Suisse Group AG | $ 7,679,594 | |||
Deutsche Bank | $ 6,967,166 | |||
Morgan Stanley Dean Witter & Company | $ 5,884,744 | |||
Barclays | $ 3,491,144 | |||
Thrivent Multidimensional Income Portfolio | Wells Fargo | $ 346,072 | ||
J.P. Morgan | $ 296,558 | |||
Bank of America Corporation | $ 275,189 | |||
Goldman, Sachs & Company | $ 222,560 | |||
Citigroup, Inc. | $ 163,933 | |||
S.C. Bernstein | $ 96,870 | |||
Credit Suisse Group AG | $ 57,311 | |||
Morgan Stanley Dean Witter & Company | $ 56,720 | |||
Barclays | $ 27,313 | |||
Thrivent Opportunity Income Plus Portfolio | Bank of America Corporation | $ 3,447,805 | ||
J.P. Morgan | $ 2,429,866 | |||
Citigroup, Inc. | $ 1,116,812 | |||
Wells Fargo | $ 1,031,513 | |||
Goldman, Sachs & Company | $ 746,925 | |||
Credit Suisse Group AG | $ 624,217 | |||
Morgan Stanley Dean Witter & Company | $ 462,270 | |||
Deutsche Bank | $ 392,263 | |||
UBS AG | $ 333,458 | |||
Barclays | $ 309,307 | |||
Mizuho Securities | $ 52,600 | |||
Thrivent Small Cap Index Portfolio | Morgan Stanley Dean Witter & Company | $ 8,834 |
Portfolio | 12/31/2019 | 12/31/2018 | 12/31/2017 | |||
Thrivent Aggressive Allocation Portfolio | 60% | 58% | 63% | |||
Thrivent All Cap Portfolio (1) | 128% | 53% | 51% | |||
Thrivent Balanced Income Plus Portfolio | 109% | 147% | 151% | |||
Thrivent Diversified Income Plus Portfolio | 157% | 155% | 146% | |||
Thrivent Global Stock Portfolio | 76% | 55% | 59% | |||
Thrivent Government Bond Portfolio | 354% | 388% | 422% | |||
Thrivent High Yield Portfolio | 48% | 36% | 50% | |||
Thrivent Income Portfolio | 101% | 108% | 105% | |||
Thrivent International Allocation Portfolio | 106% | 75% | 88% | |||
Thrivent Large Cap Growth Portfolio | 58% | 65% | 59% | |||
Thrivent Large Cap Index Portfolio | 3% | 4% | 3% | |||
Thrivent Large Cap Value Portfolio | 18% | 23% | 18% | |||
Thrivent Limited Maturity Bond Portfolio | 101% | 66% | 64% | |||
Thrivent Low Volatility Equity Portfolio (2) | 53% | 52% | 35% | |||
Thrivent Mid Cap Index Portfolio | 17% | 19% | 18% | |||
Thrivent Mid Cap Stock Portfolio | 34% | 31% | 30% | |||
Thrivent Moderate Allocation Portfolio | 136% | 134% | 155% | |||
Thrivent Moderately Aggressive Allocation Portfolio | 93% | 91% | 104% | |||
Thrivent Moderately Conservative Allocation Portfolio | 179% | 180% | 207% | |||
Thrivent Money Market Portfolio | N/A | N/A | N/A | |||
Thrivent Multidimensional Income Portfolio (2,3) | 106% | 103% | 172% | |||
Thrivent Opportunity Income Plus Portfolio | 195% | 186% | 218% | |||
Thrivent Partner Emerging Markets Equity Portfolio | 21% | 19% | 15% | |||
Thrivent Partner Growth Stock Portfolio | 29% | 43% | 52% | |||
Thrivent Partner Healthcare Portfolio | 44% | 33% | 212% | |||
Thrivent Real Estate Securities Portfolio | 23% | 35% | 15% | |||
Thrivent Small Cap Growth Portfolio (4) | 51% | 27% | N/A | |||
Thrivent Small Cap Index Portfolio | 30% | 23% | 16% | |||
Thrivent Small Cap Stock Portfolio | 53% | 58% | 44% |
(1) | The portfolio turnover rate for the fiscal year ended December 31, 2019 was higher than the previous fiscal year primarily because the Portfolio terminated a sub-adviser during the 2019 fiscal year, which caused increased portfolio turnover. |
(2) | The portfolio turnover rate for the fiscal year ended December 31, 2017 is from inception on April 28, 2017 through fiscal year end. |
(3) | The portfolio turnover rate for the fiscal year ended December 31, 2018 was lower than the previous fiscal year primarily because the Portfolio was launched during the 2017 fiscal year and the initial portfolio was constructed, which caused increased portfolio turnover. |
(4) | The portfolio turnover rate for the fiscal year ended December 31, 2018 is from inception on April 27, 2018 through fiscal year end. |
Class | Number of Shares | |
Thrivent Aggressive Allocation Portfolio | 300,000,000 | |
Thrivent All Cap Portfolio | 100,000,000 | |
Thrivent Balanced Income Plus Portfolio | 200,000,000 | |
Thrivent Diversified Income Plus Portfolio | 300,000,000 | |
Thrivent ESG Index Portfolio | 100,000,000 | |
Thrivent Global Stock Portfolio | 300,000,000 | |
Thrivent Government Bond Portfolio | 100,000,000 | |
Thrivent High Yield Portfolio | 500,000,000 | |
Thrivent Income Portfolio | 500,000,000 | |
Thrivent International Allocation Portfolio | 500,000,000 | |
Thrivent International Index Portfolio | 100,000,000 | |
Thrivent Large Cap Growth Portfolio | 200,000,000 | |
Thrivent Large Cap Index Portfolio | 100,000,000 | |
Thrivent Large Cap Value Portfolio | 300,000,000 | |
Thrivent Limited Maturity Bond Portfolio | 300,000,000 | |
Thrivent Low Volatility Equity Portfolio | 100,000,000 | |
Thrivent Mid Cap Growth Portfolio | 100,000,000 | |
Thrivent Mid Cap Index Portfolio | 100,000,000 | |
Thrivent Mid Cap Stock Portfolio | 300,000,000 | |
Thrivent Mid Cap Value Portfolio | 100,000,000 | |
Thrivent Moderate Allocation Portfolio | 1,500,000,000 | |
Thrivent Moderately Aggressive Allocation Portfolio | 1,000,000,000 | |
Thrivent Moderately Conservative Allocation Portfolio | 900,000,000 | |
Thrivent Money Market Portfolio | 1,000,000,000 | |
Thrivent Multidimensional Income Portfolio | 100,000,000 | |
Thrivent Opportunity Income Plus Portfolio | 100,000,000 | |
Thrivent Partner Emerging Markets Equity Portfolio | 100,000,000 | |
Thrivent Partner Growth Stock Portfolio | 100,000,000 | |
Thrivent Partner Healthcare Portfolio | 100,000,000 | |
Thrivent Real Estate Securities Portfolio | 100,000,000 | |
Thrivent Small Cap Growth Portfolio | 100,000,000 | |
Thrivent Small Cap Index Portfolio | 100,000,000 | |
Thrivent Small Cap Stock Portfolio | 200,000,000 |
• | Equity securities that are traded on U.S. exchanges, including options, shall be valued at the last sale price on the principle exchange as of the close of regular trading on such exchange. If there have been no sales, the latest bid quotation is used. |
• | Over-the-Counter Securities. NASDAQ National Market® securities shall be valued at the NASDAQ Official Closing Price. All other over-the-counter securities for which reliable quotations are available shall be valued at the latest bid quotation. |
• | Fixed income securities traded on a national securities exchange will be valued at the last sale price on such securities exchange that day. If there have been no sales, the latest bid quotation is used. |
• | Because market quotations are generally not “readily available” for many debt securities, foreign and domestic debt securities held by the Portfolios may be valued by an Approved Pricing Service (“APS”), using the evaluation or other valuation methodologies used by the APS. If quotations are not available from the APS, the Adviser’s Valuation Committee shall obtain a manual price from a broker or make a fair value determination. |
• | All Portfolios may value debt securities with a remaining maturity of 60 days or less at amortized cost. |
• | derive at least 90% of its gross income from dividends, interest, gains from the sale of securities, and certain other investments; |
• | invest in securities within certain statutory limits; and |
• | distribute at least 90% of its ordinary income to shareholders. |
Aaa: | Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk. |
Aa: | Obligations rated Aa are judged to be of high quality and are subject to very low credit risk. |
A: | Obligations rated A are considered upper-medium grade and are subject to low credit risk. |
Baa: | Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as such may possess certain speculative characteristics. |
Ba: | Obligations rated Ba are judged to be speculative and are subject to substantial credit risk. |
B: | Obligations rated B are considered speculative and are subject to high credit risk. |
Caa: | Obligations rated Caa are judged to be speculative of poor standing and are subject to very high credit risk. |
Ca: | Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest. |
C: | Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery of principal or interest. |
P-1: | Issuers (or supporting institutions) rated Prime-1 have a superior ability to repay short-term debt obligations. |
P-2: | Issuers (or supporting institutions) rated Prime-2 have a strong ability to repay short-term debt obligations. |
P-3: | Issuers (or supporting institutions) rated Prime-3 have an acceptable ability to repay short-term obligations. |
NP: | Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating categories. |
MIG 1: | This designation denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for refinancing. |
MIG 2: | This designation denotes strong credit quality. Margins of protection are ample, although not as large as in the preceding group. |
MIG 3: | This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow, and market access for refinancing is likely to be less well-established. |
SG: | This designation denotes speculative-grade credit quality. Debt instruments in this category may lack sufficient margins of protection. |
VMIG 1: | This designation denotes superior credit quality. Excellent protection is afforded by the superior short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand. |
VMIG 2: | This designation denotes strong credit quality. Good protection is afforded by the strong short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand. |
VMIG 3: | This designation denotes acceptable credit quality. Adequate protection is afforded by the satisfactory short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand. |
SG: | This designation denotes speculative-grade credit quality. Demand features rated in this category may be supported by a liquidity provider that does not have an investment grade short-term rating or may lack the structural and/or legal protections necessary to ensure the timely payment of purchase price upon demand. |
• | Likelihood of payment — capacity and willingness of the obligor to meet its financial commitment on an obligation in accordance with the terms of the obligation; |
• | Nature of and provisions of the obligation; |
• | Protection afforded by, and relative position of, the obligation in the event of bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights. |
AAA: | An obligation rated ‘AAA’ has the highest rating assigned by Standard & Poor’s. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong. |
AA: | An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The obligor’s capacity to meet its financial commitment on the obligation is very strong. |
A: | An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. However, the obligor’s capacity to meet its financial commitment on the obligation is still strong. |
BBB: | An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation. |
BB: | An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor’s inadequate capacity to meet its financial commitment on the obligation. |
B: | An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its financial commitment on the obligation. |
CCC: | An obligation rated ‘CCC’ is currently vulnerable to nonpayment, and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation. |
CC: | An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when a default has not yet occurred, but Standard & Poor’s expects default to be a virtual certainty, regardless of the anticipated time to default. |
C: | An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected to have lower relative seniority or lower ultimate recovery compared to obligations that are rated higher. |
D: | An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless Standard & Poor’s believes that such payments will be made within five business days in the absence of a stated grace period or within the earlier of the stated grace period or 30 calendar days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of similar action and where default on an obligation is a virtual certainty, for example due to automatic stay provisions. An obligation’s rating is lowered to ‘D’ if it is subject to a distressed exchange offer. |
NR: | This indicates that no rating has been requested, that there is insufficient information on which to base a rating, or that Standard & Poor’s does not rate a particular obligation as a matter of policy. |
Plus (+) or minus (-): | The ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories. |
A-1: | A short-term obligation rated ‘A-1’ is rated in the highest category by Standard & Poor’s. The obligor’s capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial commitment on these obligations is extremely strong. |
A-2: | A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor’s capacity to meet its financial commitment on the obligation is satisfactory. |
A-3: | A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation. |
B: | A short-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative characteristics. The obligor currently has the capacity to meet its financial commitments; however, it faces major ongoing uncertainties which could lead to the obligor’s inadequate capacity to meet its financial commitments. |
C: | A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. |
D: | A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless Standard & Poor’s believes that such payments will be made within any stated grace period. However, any stated grace period longer than five business days will be treated as five business days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action and where default on an obligation is a virtual certainty, for example due to automatic stay provisions. An obligation’s rating is lowered to ‘D’ if it is subject to a distressed exchange offer. |
Investment Grade | |
AAA: | Highest credit quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events. |
AA: | Very high credit quality. “AA” ratings denote expectations of very low credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events. |
A: | High credit quality. “A” ratings denote low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings. |
BBB: | Good credit quality. “BBB” ratings indicate that expectations of credit risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity. |
Speculative Grade | |
BB: | Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, particularly in the event of adverse changes in business or economic conditions over time; however, business or financial alternatives may be available to allow financial commitments to be met. |
B: | Highly speculative. ‘B’ ratings indicate that material credit risk is present. |
CCC: | Substantial credit risk. ‘CCC’ ratings indicate that substantial credit risk is present. |
CC: | Very high levels of credit risk. ‘CC’ ratings indicate very high levels of credit risk. |
C: | Exceptionally high levels of credit risk. ‘C’ indicates exceptionally high levels of credit risk. |
F1: | Highest short-term credit quality. Indicates the strongest intrinsic capacity for timely payment of financial commitments; may have an added “+” to denote any exceptionally strong credit feature. |
F2: | Good short-term credit quality. Good intrinsic capacity for timely payment of financial commitments. |
F3: | Fair short-term credit quality. The intrinsic capacity for timely payment of financial commitments is adequate. |
B: | Speculative short-term credit quality. Minimal capacity for timely payment of financial commitments, plus heightened vulnerability to near term adverse changes in financial and economic conditions. |
C: | High short-term default risk. Default is a real possibility. |
RD: | Restricted default. Indicates an entity that has defaulted on one or more of its financial commitments, although it continues to meet other financial obligations. Applicable to entity ratings only. |
D: | Default. Indicates a broad-based default event for an entity, or the default of a specific short-term obligation. |
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3/2/2020
THRIVENT FINANCIAL FOR LUTHERANS and THRIVENT ASSET MANAGEMENT, LLC PROXY VOTING POLICIES AND PROCEDURES SUMMARY
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RESPONSIBILITY TO VOTE PROXIES |
Overview. Thrivent Financial for Lutherans and Thrivent Asset Management, LLC (collectively, in their capacity as investment advisers, “Thrivent”) recognize and adhere to the principle that one of the privileges of owning stock in a company is the right to vote in the election of the company’s directors and on matters affecting certain important aspects of the company’s structure and operations that are submitted to shareholder vote. As an investment adviser with a fiduciary responsibility to its clients, Thrivent analyzes the proxy statements of issuers whose stock is owned by the investment companies which it sponsors and for which it serves as investment adviser (“Thrivent Funds”) and by institutional accounts who have requested that Thrivent be involved in the proxy process.
Thrivent has adopted Proxy Voting Policies and Procedures (“Policies and Procedures”) for the purpose of establishing formal policies and procedures for performing and documenting its fiduciary duty with regard to the voting of client proxies.
Fiduciary Considerations. It is the policy of Thrivent that decisions with respect to proxy issues will be made primarily in light of the anticipated impact of the issue on the desirability of investing in the portfolio company from the viewpoint of the particular client. Thrivent seeks to vote proxies solely in the interests of the client, including Thrivent Fund shareholders, and, where employee benefit plan assets are involved, in the interests of plan participants and beneficiaries. Thrivent votes proxies, where possible to do so, in a manner consistent with its fiduciary obligations and responsibilities. Logistics involved may make it impossible at times, and at other times disadvantageous, to vote proxies in every instance.
Other Considerations. One of the primary factors Thrivent considers when determining the desirability of investing in a particular company is the quality and depth of its management. The Policies and Procedures were developed with the recognition that a company’s management is entrusted with the day-to-day operations of the company, as well as its long-term direction and strategic planning, subject to the oversight of the company’s board of directors. Accordingly, Thrivent believes that the recommendation of management or the board on most issues should be given weight in determining how proxy issues should be voted and these Policies and Procedures are not intended to substitute Thrivent’s judgement for management’s with respect to a company’s day-to-day operations. However, the position of a company’s management will not be supported in any situation where it is found to be not in the best interests of Thrivent’s client, and Thrivent reserves the right to vote contrary to management when it believes a particular proxy proposal may adversely affect the investment merits of owning stock in a portfolio company, or the desirability of investing in the portfolio company from the viewpoint of the particular client.
ADMINISTRATION OF POLICIES AND PROCEDURES |
Thrivent has formed a committee that is responsible for establishing positions with respect to corporate governance and other proxy issues (“Committee”). Annually, the Committee reviews the Policies and Procedures, including in relation to recommended changes reflected in applicable benchmark policies and voting guidelines of Institutional Shareholder Services Inc. (“ISS”). As discussed below, Thrivent may, with the approval of the Committee, vote proxies other than in accordance with the applicable voting guidelines in the Policies and Procedures.
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HOW PROXIES ARE REVIEWED, PROCESSED AND VOTED |
In order to facilitate the proxy voting process, Thrivent has retained ISS as an expert in the proxy voting and corporate governance areas. ISS specializes in providing a variety of fiduciary-level proxy advisory and voting services. These services include custom vote recommendations, research, vote execution, reporting, auditing and consulting assistance for the handling of proxy voting responsibilities. ISS analyzes each proxy vote of Thrivent’s clients and prepares a recommendation that reflects ISS’s application of the Policies and Procedures. For items noted as case-by-case, Thrivent generally leverages the research process and voting guidance/recommendation provided by ISS. Thrivent may deviate from ISS recommendations on general policy issues or specific proxy proposals.
In addition, with regard to voting proxies for the Thrivent ESG Index Portfolio, Thrivent will consider environmental, social and governance criteria intended to take into account principles of socially responsible investing. These criteria include, among other things, voting guidelines provided by a third-party proxy voting service provider (i.e., the ISS Sustainability Proxy Voting Guidelines (“Sustainability Guidelines”)). The Sustainability Guidelines have been developed consistent with the dual objectives of socially responsible shareholders – financial and social. The Sustainability Guidelines seek to reflect a broad consensus of the socially responsible investing community on matters of social and environmental import and are based on a commitment to create and preserve economic value and to advance principles of good corporate governance consistent with responsibilities to society as a whole on matters of corporate governance, executive compensation, and corporate structure.
Proxy Voting Process Overview
Thrivent utilizes ISS’ voting agent services to notify us of upcoming shareholder meetings for portfolio companies held in client accounts and to transmit votes on behalf of our clients. ISS provides comprehensive summaries of proxy proposals, publications discussing key proxy voting issues, and specific vote recommendations regarding Thrivent’s clients’ portfolio company proxies to assist in the proxy voting process. The final authority and responsibility for proxy voting decisions remains with Thrivent. Decisions with respect to proxy matters are made primarily in light of the anticipated impact of the issue on the desirability of investing in the company from the viewpoint of our respective clients.
Thrivent may on any particular proxy vote determine that it is in the best interests of its clients to diverge from the Policies and Procedures’ applicable voting guidelines. In such cases, the person requesting to diverge from the Policies and Procedures’ applicable voting guidelines is required to document in writing the rationale for their vote and submit all written documentation to the Committee for review and approval. In determining whether to approve any particular request, the Committee will determine that the request is not influenced by any conflict of interest and is in the best interests of Thrivent’s clients.
Summary of Thrivent’s Voting Policies
Specific voting guidelines have been adopted by the Committee for regularly occurring categories of management and shareholder proposals. The detailed voting guidelines are available to Thrivent’s clients upon request. The following is a summary of significant Thrivent policies:
Board Structure and Composition Issues – Thrivent believes boards are expected to have a majority of directors independent of management. The independent directors are expected to organize much of the board’s work, even if the chief executive officer also serves as chairperson of the board. Key committees (audit, compensation, and nominating/corporate governance) of the board are expected to be entirely independent of management. It is expected that boards will engage in critical self-evaluation of themselves and of individual members. Boards should be sufficiently diverse to ensure consideration of a wide range of
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perspectives. Individual directors, in turn, are expected to devote significant amounts of time to their duties, to limit the number of directorships they accept, and to own a meaningful amount of stock in companies on whose boards they serve. As such, Thrivent withholds votes for directors who miss more than one-fourth of the scheduled board meetings and considers stock ownership when reviewing contested elections. Thrivent votes against management efforts to stagger board member terms because a staggered board may act as a deterrent to takeover proposals. For the same reasons, Thrivent votes for proposals that seek to fix the size of the board.
Executive and Director Compensation –These proposals necessitate a case-by-case evaluation. Generally, Thrivent opposes compensation packages that provide what we view as excessive awards to a few senior executives or that contain excessively dilutive stock option grants based on a number of criteria such as the costs associated with the plan, plan features, and dilution to shareholders.
Ratification of Auditors - Thrivent votes for proposals to ratify auditors, unless an auditor has a financial interest in or association with the company, and is therefore not independent; there is reason to believe that the independent auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; non-audit fees paid represent 50 percent or more of the total fees paid to the auditor; or poor accounting practices are identified that rise to a serious level of concern.
Mergers and Acquisitions - Thrivent votes on mergers and acquisitions on a case-by-case basis, taking into account and balancing the following: anticipated financial and operating benefits, including the opinion of the financial advisor, market reaction, offer price (cost vs. premium) and prospects of the combined companies; how the deal was negotiated; potential conflicts of interest between management’s interests and shareholders’ interests; and changes in corporate governance and their impact on shareholder rights.
Anti-takeover and Corporate Governance Issues - Thrivent generally opposes anti-takeover measures since they adversely impact shareholder rights. When voting on capital structure issues, Thrivent considers the dilutive impact to shareholders and the effect on shareholder rights.
Social, Environmental and Corporate Responsibility Issues - On proposals which are primarily social, moral or ethical Thrivent generally abstains, other than with respect to the Thrivent ESG Index Portfolio. When voting on matters with apparent economic or operational impacts on the company, Thrivent realizes that the precise economic effect of such proposals is often unclear. Where this is the case, Thrivent typically relies on management’s assessment, and generally votes with company management.
Shareblocking - Shareblocking is the practice in certain foreign countries of “freezing” shares for trading purposes in order to vote proxies relating to those shares. Thrivent generally refrains from voting shares in shareblocking countries unless the matter has compelling economic consequences that outweigh the loss of liquidity in the blocked shares.
Applying Proxy Voting Policies to non-U.S. Companies – Thrivent applies a two-tier approach to determining and applying global proxy voting policies. The first tier establishes baseline policy guidelines for the most fundamental issues, which apply without regard to a company’s domicile. The second tier takes into account various idiosyncrasies of different countries, making allowances for standard market practices, as long as they do not violate the fundamental goals of good corporate governance. The goal is to enhance shareholder value through effective use of the shareholder franchise, recognizing that applying policies developed for U.S. corporate governance may not appropriate for all markets.
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Monitoring and Resolving Conflicts of Interest – Thrivent/clients
The Committee is responsible for monitoring and resolving possible material conflicts between the interests of Thrivent and those of its clients with respect to proxy voting. Examples of situations where conflicts of interest can arise are when i) the issuer is a vendor whose products or services are material to Thrivent’s business; ii) the issuer is an entity participating to a material extent in the distribution of proprietary investment products advised, administered or sponsored by Thrivent; iii) the issuer is a significant executing broker dealer; iv) an Access Person1 of Thrivent also serves as a director or officer of the issuer; and v) there is a personal conflict of interest (e.g., familial relationship with company management).
All material conflicts of interest will be resolved in the interests of the clients. Application of the Policies and Procedures’ applicable voting guidelines to vote client proxies is generally relied on to address possible conflicts of interest since the voting guidelines are pre-determined by the Committee. In addition, in cases where proxies are voted in accordance with the Policies and Procedures’ applicable voting guidelines and consistent with ISS’s recommendation, the Committee does not review for a potential conflict of interest.
In cases where Thrivent is considering overriding these Policies and Procedures’ applicable voting guidelines, or in the event matters presented for vote are not governed by such guidelines, the Committee will follow these procedures:
● | Compliance, in consultation with Legal, will conduct a review to seek to identify any potential material conflicts of interest. If no material conflict of interest is identified, the proxy will be voted as determined by the Committee. |
● | If a material conflict of interest is identified, the Committee will be apprised of that fact and the Committee will evaluate the proposed vote in order to ensure that the proxy ultimately is voted in what Thrivent believes to be the best interests of clients, and without regard for the conflict of interest. The Committee will document its vote determination, including the nature of the conflict, the Committee’s analysis of the matters submitted for proxy vote, and the reasons why the Committee determined that the votes were cast in the best interests of clients. |
Certain Thrivent Funds (“top tier fund”) may own shares of other Thrivent Funds (‘‘underlying fund”). If an underlying fund submits a matter to a shareholder vote, the top tier fund will generally vote its shares in the same proportion as the other shareholders of the underlying fund. If there are no other shareholders in the underlying fund, the top tier fund will vote in what Thrivent believes to be in the top tier fund’s best interest.
Securities Lending
Thrivent will generally not vote nor seek to recall in order to vote shares on loan, unless it determines that a vote would have a material effect on an investment in such loaned security.
OVERSIGHT, REPORTING AND RECORD RETENTION |
Retention | of Proxy Service Provider and Oversight of Voting |
In overseeing proxy voting generally and determining whether or not to retain the services of ISS, Thrivent performs the following functions, among others, to determine that Thrivent continues to vote proxies
1 “Access Person” has the meaning provided under the current Thrivent Code of Ethics.
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in the best interest of its clients: (1) periodic sampling of proxy votes; (2) periodic reviews of Thrivent’s Policies and Procedures to determine they are adequate and have been implemented effectively, including whether they continue to be reasonably designed to ensure that proxies are voted in the best interest of Thrivent’s clients; (3) periodic due diligence on ISS designed to monitor ISS’s (i) capacity and competency to adequately analyze proxy issues, including the adequacy and quality of its staffing and personnel, as well as (ii) its methodologies for developing vote recommendations and ensuring that its research is accurate and complete; and (4) reviews of ISS’s procedures regarding their capabilities to identify and address conflicts of interest.
Proxy statements and solicitation materials of issuers (other than those which are available on the SEC’s EDGAR database) are kept by ISS in its capacity as voting agent and are available upon request. Thrivent retains documentation on shares voted differently than the Thrivent Policies and Procedures voting guidelines, and any document which is material to a proxy voting decision such as the Thrivent Policies and Procedures voting guidelines and the Committee meeting materials.
ISS provides Vote Summary Reports for each Thrivent Fund. The report specifies the company, ticker, cusip, meeting dates, proxy proposals, and votes which have been cast for the Thrivent Fund during the period, the position taken with respect to each issue and whether the Thrivent Fund voted with or against company management.
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T. ROWE PRICE ASSOCIATES, INC. AND ITS INVESTMENT
ADVISERAFFILIATES
PROXY VOTING POLICIES AND PROCEDURES
RESPONSIBILITY TO VOTE PROXIES
T. Rowe Price Associates, Inc., and its affiliated investment advisers (collectively, “T. Rowe Price”) recognize and adhere to the principle that one of the privileges of owning stock in a company is the right to vote in the election of the company’s directors and on matters affecting certain important aspects of the company’s structure and operations that are submitted to shareholder vote. The U.S.-registered investment companies which T. Rowe Price sponsors and serves as investment adviser (the “Price Funds”) as well as other investment advisory clients have delegated to T. Rowe Price certain proxy voting powers. As an investment adviser, T. Rowe Price has a fiduciary responsibility to such clients when exercising its voting authority with respect to securities held in their portfolios. T. Rowe Price reserves the right to decline to vote proxies in accordance with client-specific voting guidelines.
T. Rowe Price has adopted these Proxy Voting Policies and Procedures (“Policies and Procedures”) for the purpose of establishing formal policies and procedures for performing and documenting its fiduciary duty with regard to the voting of client proxies. This document is reviewed at least annually and updated as necessary.
Fiduciary Considerations. It is the policy of T. Rowe Price that decisions with respect to proxy issues will be made in light of the anticipated impact of the issue on the desirability of investing in the portfolio company from the viewpoint of the particular advisory client or Price Fund. Proxies are voted solely in the interests of the client, Price Fund shareholders or, where employee benefit plan assets are involved, in the interests of plan participants and beneficiaries. Our intent has always been to vote proxies, where possible to do so, in a manner consistent with our fiduciary obligations and responsibilities.
One of the primary factors T. Rowe Price considers when determining the desirability of investing in a particular company is the quality and depth of its management. We recognize that a company’s management is entrusted with the day-to-day operations of the company, as well as its long-term direction and strategic planning, subject to the oversight of the company’s board of directors. Accordingly, our proxy voting guidelines are not intended to substitute our judgment for management’s with respect to the company’s day-to-day operations. Rather, our proxy voting guidelines are designed to promote accountability of a company’s management and board of directors to its shareholders; to align the interests of management with those of shareholders; and to encourage companies to adopt best practices in terms of their corporate governance and disclosure. In addition to our proxy voting guidelines, we rely on a company’s public filings, its board recommendations, its track record, country-specific best practices codes, our research
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providers and – most importantly – our investment professionals’ views in making voting decisions.
T. Rowe Price seeks to vote all of its clients’ proxies. In certain circumstances, T. Rowe Price may determine that refraining from voting a proxy is in a client’s best interest, such as when the cost to the client of voting outweigh the expected benefit to the client. For example, the practicalities and costs involved with international investing may make it impossible at times, and at other times disadvantageous, to vote proxies in every instance.
ADMINISTRATION OF POLICIES AND PROCEDURES
Environmental, Social and Governance Committee. T. Rowe Price’s Environmental, Social and Governance Committee (“ESG Committee”) is responsible for establishing positions with respect to corporate governance and other proxy issues. Certain delegated members of the ESG Committee also review questions and respond to inquiries from clients and mutual fund shareholders pertaining to proxy issues. While the ESG Committee sets voting guidelines and serves as a resource for T. Rowe Price portfolio management, it does not have proxy voting authority for any Price Fund or advisory client. Rather, voting authority and responsibility is held by the Chairperson of the Price Fund’s Investment Advisory Committee or the advisory client’s portfolio manager. The ESG Committee is also responsible for the oversight of third-party proxy services firms that T. Rowe Price engages to facilitate the proxy voting process.
Proxy Voting Team. The Proxy Voting team is responsible for administering the proxy voting process as set forth in the Policies and Procedures.
Corporate Governance Team. Our Corporate Governance team is responsible for reviewing the proxy agendas for all upcoming meetings and making company-specific recommendations to our global industry analysts and portfolio managers with regard to the voting decisions in their portfolios.
HOW PROXIES ARE REVIEWED, PROCESSED AND VOTED
In order to facilitate the proxy voting process, T. Rowe Price has retained Institutional Shareholder Services (“ISS”) as an expert in the proxy voting and corporate governance area. ISS specializes in providing a variety of fiduciary-level proxy advisory and voting services. These services include custom vote recommendations, research, vote execution, and reporting. In order to reflect T. Rowe Price’s issue-by-issue voting guidelines as approved each year by the ESG Committee, ISS maintains and implements a custom voting policy for the Price Funds and other advisory client accounts.
Meeting Notification
T. Rowe Price utilizes ISS’ voting agent services to notify us of upcoming shareholder
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meetings for portfolio companies held in client accounts and to transmit votes to the various custodian banks of our clients. ISS tracks and reconciles T. Rowe Price holdings against incoming proxy ballots. If ballots do not arrive on time, ISS procures them from the appropriate custodian or proxy distribution agent. Meeting and record date information is updated daily and transmitted to T. Rowe Price through ProxyExchange, an ISS application.
Vote Determination
Each day, ISS delivers into T. Rowe Price’s customized ProxyExchange environment a comprehensive summary of upcoming meetings, proxy proposals, publications discussing key proxy voting issues, and custom vote recommendations to assist us with proxy research and processing. The final authority and responsibility for proxy voting decisions remains with T. Rowe Price. Decisions with respect to proxy matters are made primarily in light of the anticipated impact of the issue on the desirability of investing in the company from the perspective of our clients.
Portfolio managers execute their responsibility to vote proxies in different ways. Some have decided to vote their proxies generally in line with the guidelines as set by the ESG Committee. Others review the customized vote recommendations and approve them before the votes are cast. In all cases, portfolio managers receive current reports summarizing all proxy votes in their client accounts. Portfolio managers who vote their proxies inconsistent with T. Rowe Price guidelines are required to document the rationale for their votes. The Proxy Voting team is responsible for maintaining this documentation and assuring that it adequately reflects the basis for any vote which is contrary to our proxy voting guidelines.
T. Rowe Price Voting Policies
Specific proxy voting guidelines have been adopted by the ESG Committee for all regularly occurring categories of management and shareholder proposals. A detailed set of proxy voting guidelines is available on the T. Rowe Price website, www.troweprice.com. The following is a summary of our guidelines on the most significant proxy voting topics:
Election of Directors – For most companies, T. Rowe Price generally expects boards to maintain a majority of independent directors. T. Rowe Price may vote against outside directors who do not meet our criteria relating to their independence, particularly when they serve on key board committees, such as compensation and nominating committees, for which we believe that all directors should be independent. In certain markets where majority-independent boards are uncommon, we expect companies to adhere to the minimum independence standard established by regional corporate governance codes. At a minimum, however, we believe boards in all regions should include a blend of executive and non-executive members, and we are likely to vote against senior executives at companies with insufficient representation by independent directors. We also vote against directors who are unable to dedicate sufficient time to their board duties due to their commitments to other boards. We may vote against certain directors who have served on company boards where we believe there has been a gross failure in governance or oversight. In certain markets, a lack of diversity on the board may cause us to oppose the members of the board’s Nominating Committee. Additionally, we may vote against compensation committee members
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who approve excessive executive compensation or severance arrangements. We support efforts to elect all board members annually because boards with staggered terms lessen directors’ accountability to shareholders and act as deterrents to takeover proposals. To strengthen boards’ accountability, T. Rowe Price supports proposals calling for a majority vote threshold for the election of directors and we may withhold votes from an entire board if they fail to implement shareholder proposals that receive majority support.
Anti-Takeover, Capital Structure and Corporate Governance Issues – T. Rowe Price generally opposes anti-takeover measures since they adversely impact shareholder rights and limit the ability of shareholders to act on potential value-enhancing transactions. Such anti-takeover mechanisms include classified boards, supermajority voting requirements, dual share classes, and poison pills. When voting on capital structure proposals, T. Rowe Price will consider the dilutive impact to shareholders and the effect on shareholder rights.
Executive Compensation Issues – T. Rowe Price’s goal is to assure that a company’s equity-based compensation plan is aligned with shareholders’ long-term interests. We evaluate plans on a case-by-case basis, using a number of factors, including dilution to shareholders, problematic plan features, burn rate, and the equity compensation mix. Plans that are constructed to effectively and fairly align executives’ and shareholders’ incentives generally earn our approval. Conversely, we oppose compensation packages that provide what we view as excessive awards to few senior executives or contain the potential for excessive dilution relative to the company’s peers. We also may oppose equity plans at any company where we deem the overall compensation practices to be problematic. We generally oppose efforts to reprice options in the event of a decline in value of the underlying stock unless such plans appropriately balance shareholder and employee interests. For companies with particularly egregious pay practices such as excessive severance packages, executives with outsized pledged/hedged stock positions, executive perks, and bonuses that are not adequately linked to performance, we may vote against members of the board’s Compensation Committee. We analyze management proposals requesting ratification of a company’s executive compensation practices (“Say-on-Pay” proposals) on a case-by-case basis, using a screen that assesses the long-term linkage between executive compensation and company performance as well as the presence of objectionable structural features in compensation plans. Finally, we may oppose Compensation Committee members or even the entire board if we have cast votes against a company’s “Say-on-Pay” vote in consecutive years.
Mergers and Acquisitions – T. Rowe Price considers takeover offers, mergers, and other extraordinary corporate transactions on a case-by-case basis to determine if they are beneficial to shareholders’ current and future earnings stream and to ensure that our Price Funds and advisory clients are receiving fair consideration for their securities. We oppose a high proportion of proposals for the ratification of executive severance packages (“Say on Golden Parachute” proposals) in conjunction with merger transactions if we conclude these arrangements reduce the alignment of executives’ incentives with shareholders’ interests.
Corporate Social Responsibility Issues – Vote recommendations for corporate responsibility issues are generated by the Corporate Governance team in consultation with our
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Responsible Investment team. T. Rowe Price takes into consideration a company’s existing level of disclosure on matters of a social, environmental, or corporate responsibility nature. If the proposal addresses an issue with substantial investment implications for the company’s business or operations, and those issues have not been adequately addressed by management, T. Rowe Price generally supports calls for additional disclosure.
Global Portfolio Companies – The ESG Committee has developed custom international proxy voting guidelines based on ISS’ general global policies, regional codes of corporate governance, and our own views as investors in these markets. ISS applies a two-tier approach to determining and applying global proxy voting policies. The first tier establishes baseline policy guidelines for the most fundamental issues, which span the corporate governance spectrum without regard to a company’s domicile. The second tier takes into account various idiosyncrasies of different countries, making allowances for standard market practices, as long as they do not violate the fundamental goals of good corporate governance. The goal is to enhance shareholder value through effective use of the shareholder franchise, recognizing that application of policies developed for U.S. corporate governance issues are not appropriate for all markets.
Fixed Income and Passively Managed Strategies – Proxy voting for our fixed income and indexed portfolios is administered by the Proxy Voting team using T. Rowe Price’s guidelines as set by the ESG Committee. Indexed strategies generally vote in line with the T. Rowe Price guidelines. Fixed income strategies generally follow the proxy vote determinations on security holdings held by our equity accounts unless the matter is specific to a particular fixed income security such as consents, restructurings, or reorganization proposals.
Shareblocking – Shareblocking is the practice in certain foreign countries of “freezing” shares for trading purposes in order to vote proxies relating to those shares. In markets where shareblocking applies, the custodian or sub-custodian automatically freezes shares prior to a shareholder meeting once a proxy has been voted. T. Rowe Price’s policy is generally to refrain from voting shares in shareblocking countries unless the matter has compelling economic consequences that outweigh the loss of liquidity in the blocked shares.
Securities on Loan – The Price Funds and our institutional clients may participate in securities lending programs to generate income for their portfolios. Generally, the voting rights pass with the securities on loan; however, lending agreements give the lender the right to terminate the loan and pull back the loaned shares provided sufficient notice is given to the custodian bank in advance of the applicable deadline. T. Rowe Price’s policy is generally not to vote securities on loan unless we determine there is a material voting event that could affect the value of the loaned securities. In this event, we have the discretion to pull back the loaned securities in order to cast a vote at an upcoming shareholder meeting. A monthly monitoring process is in place to review securities on loan and how they may affect proxy voting.
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Monitoring and Resolving Conflicts of Interest
The ESG Committee is also responsible for monitoring and resolving potential material conflicts between the interests of T. Rowe Price and those of its clients with respect to proxy voting. We have adopted safeguards to ensure that our proxy voting is not influenced by interests other than those of our fund shareholders and other investment advisory clients. While membership on the ESG Committee is diverse, it does not include individuals whose primary duties relate to client relationship management, marketing, or sales. Since T. Rowe Price’s voting guidelines are predetermined by the ESG Committee, application of the guidelines by portfolio managers to vote client proxies should in most instances adequately address any potential conflicts of interest. However, consistent with the terms of the Policies and Procedures, which allow portfolio managers to vote proxies opposite our general voting guidelines, the ESG Committee regularly reviews all such proxy votes that are inconsistent with the proxy voting guidelines to determine whether the portfolio manager’s voting rationale appears reasonable. The ESG Committee also assesses whether any business or other material relationships between T. Rowe Price and a portfolio company (unrelated to the ownership of the portfolio company’s securities) could have influenced an inconsistent vote on that company’s proxy. Issues raising potential conflicts of interest are referred to designated members of the ESG Committee for immediate resolution prior to the time T. Rowe Price casts its vote.
With respect to personal conflicts of interest, T. Rowe Price’s Code of Ethics and Conduct requires all employees to avoid placing themselves in a “compromising position” in which their interests may conflict with those of our clients and restrict their ability to engage in certain outside business activities. Portfolio managers or ESG Committee members with a personal conflict of interest regarding a particular proxy vote must recuse themselves and not participate in the voting decisions with respect to that proxy.
Specific Conflict of Interest Situations—Voting of T. Rowe Price Group, Inc. common stock (sym: TROW) by certain T. Rowe Price Index Funds will be done in all instances in accordance with T. Rowe Price voting guidelines and votes inconsistent with the guidelines will not be permitted. In the event that there is no previously established guideline for a specific voting issue appearing on the T. Rowe Price Group proxy, the Price Funds will abstain on that voting item. In addition, T. Rowe Price has voting authority for proxies of the holdings of certain Price Funds that invest in other Price Funds. In cases where the underlying fund of an investing Price Fund, including a fund-of-funds, holds a proxy vote, T. Rowe Price will mirror vote the fund shares held by the upper-tier fund in the same proportion as the votes cast by the shareholders of the underlying funds (other than the T. Rowe Price Reserve Investment Fund).
Limitations on Voting Proxies of Banks
T. Rowe Price has obtained relief from the U.S. Federal Reserve Board (the “FRB Relief”) which permits, subject to a number of conditions, T. Rowe Price to acquire in the aggregate on behalf of its clients, 10% or more of the total voting stock of a bank, bank holding company, savings and loan holding company or savings association (each a “Bank”), not to exceed a 15% aggregate beneficial ownership maximum in such Bank. One such condition affects the manner
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in which T. Rowe Price will vote its clients’ shares of a Bank in excess of 10% of the Bank’s total voting stock (“Excess Shares”). The FRB Relief requires that T. Rowe Price use its best efforts to vote the Excess Shares in the same proportion as all other shares voted, a practice generally referred to as “mirror voting,” or in the event that such efforts to mirror vote are unsuccessful, Excess Shares will not be voted. With respect to a shareholder vote for a Bank of which T. Rowe Price has aggregate beneficial ownership of greater than 10% on behalf of its clients, T. Rowe Price will determine which of its clients’ shares are Excess Shares on a pro rata basis across all of its clients’ portfolios for which T. Rowe Price has the power to vote proxies.
REPORTING, RECORD RETENTION AND OVERSIGHT
The ESG Committee, and certain personnel under the direction of the ESG Committee, perform the following oversight and assurance functions, among others, over T. Rowe Price’s proxy voting: (1) periodically samples proxy votes to ensure that they were cast in compliance with T. Rowe Price’s proxy voting guidelines; (2) reviews, no less frequently than annually, the adequacy of the Policies and Procedures to make sure that they have been implemented effectively, including whether they continue to be reasonably designed to ensure that proxies are voted in the best interests of our clients; (3) performs due diligence on whether a retained proxy advisory firm has the capacity and competency to adequately analyze proxy issues, including the adequacy and quality of the proxy advisory firm’s staffing and personnel and its policies; and (4) oversees any retained proxy advisory firms and their procedures regarding their capabilities to (i) produce proxy research that is based on current and accurate information and (ii) identify and address any conflicts of interest and any other considerations that we believe would be appropriate in considering the nature and quality of the services provided by the proxy advisory firm.
T. Rowe Price will furnish Vote Summary Reports, upon request, to its institutional clients that have delegated proxy voting authority. The report specifies the portfolio companies, meeting dates, proxy proposals, and votes which have been cast for the client during the period and the position taken with respect to each issue. Reports normally cover quarterly or annual periods and are provided to such clients upon request.
T. Rowe Price retains proxy solicitation materials, memoranda regarding votes cast in opposition to the position of a company’s management, and documentation on shares voted differently. In addition, any document which is material to a proxy voting decision such as the T. Rowe Price proxy voting guidelines, ESG Committee meeting materials, and other internal research relating to voting decisions are maintained in accordance with applicable requirements.
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PART C
OTHER INFORMATION
Item 15. | Indemnification |
Section 4.01 of Registrant’s First Amended and Restated Bylaws contains provisions requiring the indemnification by Registrant of its directors, officers and certain others under certain conditions. If so required, Registrant shall indemnify its trustees, officers or employees for such expenses whether or not there is an adjudication of liability, if, pursuant to Investment Company Act Release 11330, a determination is made that such person is entitled to indemnification by: (i) final decision of the court before which the proceeding was brought; or (ii) in the absence of such a decision, a reasonable determination, based on factual review, that the person is entitled to indemnification is made by: (a) a majority vote of disinterested, independent trustees; or (b) independent legal counsel in a written opinion.
Advancement of expenses incurred in defending such actions may be made pursuant to Release 11330, provided that the person undertakes to repay the advance unless it is ultimately determined that such person is entitled to indemnification and one or more of the following conditions is met: (1) the person provides security for the undertaking; (2) Registrant is insured against losses arising by reason of any lawful advances; or (3) a majority of disinterested non-party trustees or independent legal counsel in a written opinion determines, based on review of readily available facts, that there is reason to believe the person ultimately will be found entitled to indemnification.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of Registrant, pursuant to the foregoing provisions or otherwise, Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Registrant of expenses incurred or paid by a director or officer or controlling person of Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person of Registrant in connection with the securities being registered, Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether or not such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
Registrant and its officers, employees, and agents are insured under the fidelity bond required by Rule 17g-1 of the Investment Company Act of 1940.
Item 16. | Exhibits |
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Item 17. | Undertakings |
(1) | The undersigned registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this registration statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act [17 CFR 230.145c], the reoffering prospectus will contain the information called for by the applicable registration form for the reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
(2) | The undersigned registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the registration statement and will not be used until the amendment is effective, and that, in determining any liability under the 1933 Act, each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them. |
(3) | The undersigned registrant agrees to file, by post-effective amendment to the registration statement, an opinion of counsel supporting the tax consequences of the proposed reorganization as soon as practicable after the closing of the reorganization. |
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SIGNATURES
As required by the Securities Act of 1933, this Registration Statement has been signed on behalf of the Registrant in the City of Minneapolis, State of Minnesota, on this 24th day of June, 2020.
THRIVENT SERIES FUND, INC. |
/s/ John D. Jackson |
John D. Jackson |
Assistant Secretary |
As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on this 24th day of June, 2020.
Signature | Title | |||
/s/ David S. Royal | Director and President (Principal Executive Officer) | |||
David S. Royal | ||||
/s/ Gerard V. Vaillancourt | Treasurer (Principal Financial and Accounting Officer) | |||
Gerard V. Vaillancourt | ||||
* | Director | |||
Janice B. Case | ||||
* | Director | |||
Robert J. Chersi | ||||
* | Director | |||
Marc S. Joseph | ||||
* | Director | |||
Paul R. Laubscher | ||||
* | Director | |||
James A. Nussle | ||||
* | Director | |||
Verne O. Sedlacek | ||||
* | Director | |||
Constance L. Souders | ||||
* | Director | |||
Russell W. Swansen |
* | John D. Jackson, by signing his name hereto, does hereby sign this document on behalf of each of the above- named Directors and Officers of Thrivent Series Fund, Inc. pursuant to the powers of attorney duly executed by such persons and filed herewith. |
Dated: June 24, 2020 | /s/ John D. Jackson | |
John D. Jackson | ||
Attorney-in-Fact |