SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrantþ
Filed by a Party other than the Registranto
Check the appropriate box:
o | Preliminary Proxy Statement | o | Confidential, For Use of the Commission | |||
þ | Definitive Proxy Statement | Only (as permitted by Rule 14a-6(e)(2)) | ||||
o | Definitive Additional Materials | |||||
o | Soliciting Material Under Rule 14a-12 |
BB&T FUNDS
Alan G. Priest, Esq.
Ropes & Gray LLP
One Metro Center
700 12th Street, NW, Suite 900
Washington, D.C. 20005
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box): | ||
þ | No fee required. | |
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. | |
(1) | Title of each class of securities to which transaction applies: N/A | |
(2) | Aggregate number of securities to which transaction applies: N/A | |
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing is calculated and state how it was determined).: N/A | |
(4) | Proposed maximum aggregate value of transaction: N/A | |
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o | Fee paid previously with preliminary materials: | |
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. | |
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(4) | Date Filed: N/A |
Notes:
Proposal | Funds | |||
1 | To approve Investment Sub-Advisory Agreements between BB&T Asset Management, Inc. (“BB&T” or the “Adviser”) and Sterling Capital Management LLC (“Sterling Capital”) with respect to the Mid Cap Value Fund, Total Return Bond Fund and Total Return Bond VIF | All Funds, voting separately | ||
2 | To approve an amendment to the investment objective of the Mid Cap Value Fund | Mid Cap Value Fund | ||
3 | To transact such other business as may properly come before the Special Meeting or any adjournment thereof | All Funds, voting separately |
By Order of the Trustees of each Trust | |
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C. David Bunstine | |
Secretary of each Trust | |
June 8, 2005 | |
SHAREHOLDERS ARE REQUESTED TO PROMPTLY VOTE BY TELEPHONE OR THE INTERNET OR TO EXECUTE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE THE ACCOMPANYING PROXY CARD WHICH IS BEING SOLICITED BY BB&T FUNDS’ AND BB&T VARIABLE INSURANCE FUNDS’ BOARDS OF TRUSTEES. THIS IS IMPORTANT TO ENSURE A QUORUM AT THE SPECIAL MEETING. PROXIES MAY BE REVOKED AT ANY TIME BEFORE THEY ARE EXERCISED BY SUBMITTING TO BB&T FUNDS OR BB&T VARIABLE INSURANCE FUNDS A WRITTEN NOTICE OF REVOCATION OR A SUBSEQUENTLY EXECUTED PROXY OR BY ATTENDING THE SPECIAL MEETING AND VOTING IN PERSON.
Sincerely, | |
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Keith F. Karlawish | |
President | |
BB&T Funds and | |
BB&T Variable Insurance Funds |
Q. | WHY ARE THE BOARDS OF TRUSTEES PROPOSING TO ADOPT INVESTMENT SUB-ADVISORY AGREEMENTS WITH RESPECT TO THE FUNDS? |
A. | On May 20-21, 2005 the Boards of Trustees of the BB&T Trust and BB&T VIF Trust decided to hire Sterling Capital as the investment sub-adviser to the Funds. In reaching this conclusion, the Trustees considered the best interests of both current and future shareholders of the Funds. In unanimously approving the proposed Investment Sub-Advisory Agreements and recommending the approval of such Agreements by Shareholders, the Trustees of the Funds, including the independent Trustees, considered the best interests of Shareholders of the Funds and took into account all factors they deemed relevant. The factors considered by the Trustees included the nature, quality and extent of the service to be provided by Sterling Capital and data on investment performance, management fees and expense ratios of competitive funds. After considering these factors, the Trustees concluded that the proposed Investment Sub-Advisory Agreements would be beneficial to the Funds and to Shareholders. |
Q. | WILL APPROVAL OF THE INVESTMENT SUB-ADVISORY AGREEMENTS RESULT IN ANY ADDITIONAL SHAREHOLDER EXPENSE? |
A. | No. Under the proposed agreements, the Adviser will continue to have full responsibility for providing investment advisory services to the Funds and will compensate the Sub-Adviser at its sole expense. |
Q. | WHY IS THE BB&T FUNDS’ BOARD OF TRUSTEES PROPOSING TO AMEND THE INVESTMENT OBJECTIVE OF THE MID CAP VALUE FUND? |
A. | After considering the Mid Cap Value Fund’s present investment objective and Sterling Capital’s investment management strengths, the BB&T Funds’ Board of Trustees has determined that it would be desirable to focus on seeking long-term growth of capital, without requiring the generation of current income. |
Q. | WHAT IF I DO NOT RETURN MY PROXY VOTING BALLOT? |
A. | In order to conduct the Shareholder Meeting, a quorum must be present, in person or by proxy. A quorum for each Fund is defined as representation of over 50% of the shares outstanding for such Fund as of May 23, 2005. In the event that not enough shareholders return the enclosed proxy ballot card to achieve quorum, we will be forced to incur additional expenses associated with additional solicitations. In order to avoid additional costs, please return the completed proxy ballot as soon as possible. |
Q. | HOW DOES THE BOARD SUGGEST THAT I VOTE? |
A. | After careful consideration, the Boards of Trustees of BB&T Funds and BB&T Variable Insurance Funds, including the independent members, recommend that you vote “FOR” (i) adopting the proposed Investment Sub-Advisory Agreements and (ii) approving an amendment to the investment objective of the Mid Cap Value Fund. The Boards also wish to urge you to vote and return all the proxy ballot cards you receive. |
Q. | WHOM SHOULD I CALL WITH QUESTIONS ABOUT THIS PROXY? |
A. | If you have any questions regarding this proxy, please contact your account administrator, investment representative, or BB&T Funds and BB&T Variable Insurance Funds directly at 1-800-228-1872. |
* | Prior to June 1, 2005, the BB&T Total Return Bond Fund was known as the BB&T Intermediate Corporate Bond Fund. |
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Number of | Percent | |||||||
Name and Address of Beneficial Owner | Shares Owned | of Class | ||||||
Mid Cap Value Fund — A Shares | ||||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 166247.331 | 25.89 | ||||||
Branch Banking & Trust Co Daily Recordkeeping Plans 300 East Wendover Avenue Attn Daily Trade Team Greensboro NC 27401 | 41009.842 | 6.39 | ||||||
Mid Cap Value Fund — B Shares | ||||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 32398.568 | 13.13 |
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Number of | Percent | |||||||
Name and Address of Beneficial Owner | Shares Owned | of Class | ||||||
Mid Cap Value Fund — C Shares | ||||||||
MCB Trust Services Cust or Trustee Forsyth County Development Cor 700 17th St Ste 150 Denver Co 80202 | 9397.768 | 40.03 | ||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 7981.682 | 34.00 | ||||||
A Wayne Annas Carolyn B Annas P O Box 563 Valdese NC 28690 | 2398.756 | 10.22 | ||||||
Theodora J Kurcaba RT 1 Box 163-C Terra Alta WV 26764 | 1427.595 | 6.08 | ||||||
Mid Cap Value Fund — I Shares | ||||||||
Wilbranch & Co Pt No Fee Dr 223 W Nash St Wilson NC 278933801 | 7570136.063 | 65.91 | ||||||
Branch Banking & Trust Co Daily Recordkeeping Plans 300 East Wendover Avenue Attn Daily Trade Team Greensboro NC 27401 | 2980814.39 | 25.95 |
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Number of | Percent | |||||||
Name and Address of Beneficial Owner | Shares Owned | of Class | ||||||
Total Return Bond Fund — A Shares | ||||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 167169.423 | 29.05 | ||||||
Branch Banking & Trust Co Daily Recordkeeping Plans 300 East Wendover Avenue Attn Daily Trade Team Greensboro NC 27401 | 112248.024 | 19.50 | ||||||
Edna A Oakley 3976 Figsboro Road Martinsville VA 24112 | 32072.043 | 5.57 | ||||||
Mark R Reed 64 Colson Cove Dr Bronston KY 42518 | 30831.981 | 5.36 | ||||||
Total Return Bond Fund — B Shares | ||||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 166913.723 | 27.63 | ||||||
Total Return Bond Fund — C Shares | ||||||||
Pershing LLC 1 Pershing Plaza Jersey City NJ 07399 | 16088.963 | 77.14 | ||||||
Ernest D Rhodes 1112 Crews Shop Rd Lynchburg VA 245044189 | 2382.171 | 11.42 | ||||||
Total Return Bond Fund — I Shares | ||||||||
Wilbranch & Co Pt No Fee Dr 223 W Nash St Wilson NC 278933801 | 28388301.497 | 85.81 | ||||||
Branch Banking & Trust Co Daily Recordkeeping Plans 300 East Wendover Avenue Attn Daily Trade Team Greensboro NC 27401 | 1837830.119 | 5.56 |
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Number of | Percent | |||||||
Name and Address of Beneficial Owner | Shares Owned | of Class | ||||||
Wilbranch Co P O Box 2887 Attn J Michael Pollock Wilson NC 278941847 | 1528436.763 | 92.31 | ||||||
Hartford Life 200 Hopmeadow St Attn David Ten-Broeck Simsbury Ct 06070 | 127358.483 | 7.69 | ||||||
June 8, 2005 |
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• | The Boards of Trustees have unanimously approved the proposed Investment Sub-Advisory Agreements relating to each of the Mid Cap Value Fund, Total Return Bond Fund and Total Return Bond Fund VIF; | |
• | Sterling Capital will provide investment management sub-advisory services to the Funds subject to the direction and supervision of the Boards of Trustees and BB&T; | |
• | BB&T will continue to review, supervise and administer the Funds’ investment programs; and | |
• | There will be no change in the fees payable by the Funds to BB&T for advisory services as a result of approval of the proposed Sub-Advisory Agreements. |
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Current objective: | to seek “current income, with a secondary goal of moderate capital appreciation” by investing primarily in domestically traded U.S. common stocks of middle capitalization U.S. companies whose capitalization is within the range of those companies in the Russell Midcap® Value Index as well as American Depositary Receipts. | |
Proposed objective: | to seek “long-term growth of capital” by investing the Fund’s assets primarily in equity securities of companies that are considered to be undervalued. |
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Position(s) held with BB&T | ||||
Name and Address | and/or BB&T VIF | Principal Occupation | ||
Thomas W. Lambeth 700 Yorkshire Road Winston-Salem, NC 27106 | Trustee, Chairman of the Board of Trustees | Senior Fellow, Z. Smith Reynolds Foundation. | ||
Drew T. Kagan Montecito Advisors, Inc. 810 N. Jefferson St Suite 101 Lewisburg, WV 24901 | Trustee | President and Director, Montecito Advisors, Inc. | ||
Laura C. Bingham Peace College Office of the President 15 East Peace Street Raleigh, NC 27604-1194 | Trustee | President, Peace College. | ||
Douglas R. Van Scoy 841 Middle Street Sullivans Island, SC 26481 | Trustee | Retired. | ||
James L. Roberts 7 Kittansett Court Skillman, NJ 08558 | Trustee | Retired. | ||
Kenneth L. Miller, Jr. 200 W. Second Street, 16th Floor Winston-Salem, NC 27101 | Trustee | Executive Vice President, Branch Banking and Trust Company. |
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Position(s) held with BB&T | ||||
Name and Address | and/or BB&T VIF | Principal Occupation | ||
Keith F. Karlawish 434 Fayetteville St Raleigh, NC 27601 | President | President, BB&T Asset Management, Inc. | ||
James T. Gillespie 434 Fayetteville St Raleigh, NC 27601 | Vice President | Vice President, BB&T Asset Management, Inc. | ||
E.G. Purcell, III 434 Fayetteville St Raleigh, NC 27601 | Vice President | Senior Vice President, BB&T Asset Management, Inc. | ||
Troy A. Sheets 3435 Stelzer Road Columbus, OH 43219 | Treasurer | Employee, BISYS Fund Services. | ||
Frank Pavlak 3435 Stelzer Road Columbus, OH 43219 | Vice President, Chief Compliance Officer and AML Compliance Officer | Senior Vice President, BISYS Fund Services. | ||
C. David Bunstine 3435 Stelzer Road Columbus, OH 43219 | Secretary | Employee, BISYS Fund Services. | ||
Alaina V. Metz 3435 Stelzer Road Columbus, OH 43219 | Assistant Secretary | Employee, BISYS Fund Services. | ||
Chris Sabato 3435 Stelzer Road Columbus, OH 43219 | Assistant Treasurer | Employee, BISYS Fund Services. |
Percent of Voting Shares | ||||||||
Entity | Address | Owned by Immediate Parent | ||||||
Sterling Capital Management LLC | 4064 Colony Road Suite 300 Charlotte, NC 28211 | 70% |
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Position(s) held with | ||||||||
Name and Address | Sterling Capital | Principal Occupation | ||||||
Eduardo Brea | Managing Director | Investment Advisory | ||||||
Alexander McAlister | Managing Director | Investment Advisory | ||||||
David Ralston | Managing Director | Investment Advisory | ||||||
Brian Walton | Managing Director | Investment Advisory | ||||||
Mark Whalen | Managing Director | Investment Advisory |
Assets as of | Advisory Fee | |||||||||||||||
Most Recent Fiscal | Fiscal Year End | Paid as of Fiscal | ||||||||||||||
Fund Name | Year End | In Millions | Advisory Fee Rate | Year End | ||||||||||||
Hartford Select | N/A (began May 2005 | ) | N/A | 45% | N/A | |||||||||||
Midcap Value Fund |
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BB&T Asset Management, Inc. | ||
By: Title: | ||
Sterling Capital, Management LLC | ||
By: Title: |
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Name Of Fund | Annual Rate Of Compensation | |
BB&T Mid Cap Value Fund | 0.40% of the Fund’s average daily net assets | |
BB&T Total Return Bond Fund | 0.25% of the Fund’s average daily net assets | |
Consented to by: | ||
Date: , 2005 | BB&T Asset Management, Inc. By: | |
Date: , 2005 | Sterling Capital Management LLC By: |
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BB&T Asset Management, Inc. | ||
By: Title: | ||
Sterling Capital, Management LLC | ||
By: Title: |
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Name Of Fund | Annual Rate Of Compensation | |
BB&T Total Return Bond VIF | 0.25% of the Fund’s average daily net assets | |
Consented to by: | ||
Date: , 2005 | BB&T Asset Management, Inc. By: | |
Date: , 2005 | Sterling Capital Management LLC By: |
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To vote by Internet | To vote by telephone | ||||||||
1. | Read the Proxy Statement and have your Proxy Card below at hand. | 1. | Read the Proxy Statement and have your Proxy Card below at hand. | ||||||
2. | Go to the Websitewww.proxyweb.com. | 2. | Call 1-800-690-6903. | ||||||
3. | Follow the simple instructions. | 3. | Follow the simple instructions. |
999 999 999 999 99←
PROXY CARD
FUND NAME PRINTS HERE | PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS | |
ON JULY 8, 2005 |
This proxy is solicited by the Board of Trustees of BB&T Funds for use at a Special Meeting of Shareholders (“Special Meeting”) to be held on July 8, 2005 at 2:00 p.m. Eastern Time at 100 Summer Street, Suite 1500, Boston, MA 02110.
The undersigned hereby appoints C. David Bunstine and Tim Bresnahan, each of them with full power of substitution as proxies of the undersigned, to vote, as designated on reverse, at the above-stated Special Meeting and at any and all adjournments thereof, all units of beneficial interest in the Fund held of record by the undersigned on the record date for the Special Meeting, upon the following matters and upon any other matter which may come before the Special Meeting in their discretion.
ê Date:__________________, 2005
The undersigned hereby acknowledges receipt of the Notice of Special Meeting dated July 8, 2005 and the Proxy Statement attached hereto.
ê | ê | BB&T KW |
MIS EDITS: # OF CHANGES ___/___PRF 1 ___PRF 2 ___
OK TO PRINT AS IS* ___*By signing this form you are authorizing MIS to print this form in its current state.
ê | Please fill in box(es) as shown using black or blue ink or number 2 pencil. | x | ê | |||||
PLEASE DO NOT USE FINE POINT PENS. |
Every properly executed proxy will be voted in the manner specified hereon and, in the absence of specification, will be treated as granting authority to vote FOR the below-enumerated proposals.
FOR | AGAINST | ABSTAIN | ||||||
PROPOSAL (1) | Approval of the Sterling Capital Investment Sub-Advisory Agreement between BB&T Asset Management, Inc. and Sterling Capital Management LLC. | o | o | o | ||||
PROPOSAL (2) | Approval of an amendment to the fundamental investment objective of the Fund. | o | o | o | ||||
PROPOSAL (3) | Transaction of such other business as may properly come before the Special Meeting. |
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
ê | MCV KW | ê |
MIS EDITS: # OF CHANGES ___/___PRF 1 ___PRF 2 ___
OK TO PRINT AS IS* ___*By signing this form you are authorizing MIS to print this form in its current state.
ê | Please fill in box(es) as shown using black or blue ink or number 2 pencil. | x | ê | |||||
PLEASE DO NOT USE FINE POINT PENS. |
Every properly executed proxy will be voted in the manner specified hereon and, in the absence of specification, will be treated as granting authority to vote FOR the below-enumerated proposals.
FOR | AGAINST | ABSTAIN | ||||||
PROPOSAL (1) | Approval of the Sterling Capital Investment Sub-Advisory Agreement between BB&T Asset Management, Inc. and Sterling Capital Management LLC. | o | o | o | ||||
PROPOSAL (2) | NOT APPLICABLE | |||||||
PROPOSAL (3) | Transaction of such other business as may properly come before the Special Meeting. |
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
ê | TRB KW | ê |
MIS EDITS: # OF CHANGES ___/___PRF 1 ___PRF 2 ___
OK TO PRINT AS IS* ___*By signing this form you are authorizing MIS to print this form in its current state.