File Nos. 33-4382 & 811-4626
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-12
THE CASCADES TRUST
(Exact Name of Registrant as Specified in Charter)
380 Madison Avenue, Suite 2300
New York, New York 10017
(Address of Principal Executive Offices)
(212) 697-6666
(Registrant's Telephone Number)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
Important Notice
Please Read Immediately
Aquilasm
Group of Funds
Tax-Free Trust of Oregon
380 Madison Avenue, Suite 2300, New York, NY 10017
Notice of Annual Meeting of
Shareholders to Be Held
on April 10, 2006
To Shareholders of the Trust:
The purpose of this Notice is to advise you that an Annual Meeting of the
Shareholders of Tax-Free Trust of Oregon (the "Trust"), the only series of the
Cascades Trust, will be held:
Place: (a) at the World Forestry Center
4033 SW Canyon Road
Portland, Oregon;
Time: (b) on Monday, April 10, 2006
at 1:00 p.m. Pacific Daylight Time;
Purposes: (c) for the following purposes:
(i) to elect eight Trustees; each Trustee elected will hold
office until the next annual meeting of the Trust's
shareholders or until his or her successor is duly
elected (Proposal No. 1);
(ii) to ratify (that is, to approve) or reject the selection
of Tait, Weller & Baker LLP as the Trust's independent
registered public accounting firm for the fiscal year
ending September 30, 2006 (Proposal No. 2);
(iii) to act upon any other matters which may properly come
before the Meeting at the scheduled time and place or
any adjourned meeting or meetings.
Who Can Vote
What Shares: (d) To vote at the Meeting, you must have been a
shareholder on the Trust's records at the close of business
on January 12, 2006 (the "record date"). Also, the number of
shares of each of the Trust's outstanding classes of shares
that you held at that time and the respective net asset
values of each class of shares at that time determine the
number of votes you may cast at the Meeting (or any
adjourned meeting or meetings).
By order of the Board of Trustees,
EDWARD M. W. HINES
Secretary
March 6, 2006
Please Note:
If you do not expect to attend the Meeting, please vote by any of three ways: by
the Internet, by telephone or by completing the enclosed proxy card and
returning it in the accompanying stamped envelope. To avoid unnecessary expense
to the Trust, we request your cooperation in voting no matter how large or small
your holding may be.
Tax-Free Trust of Oregon
380 Madison Avenue, Suite 2300,
New York, New York 10017
Proxy Statement
Introduction
The purpose of the Notice preceding this Proxy Statement is to advise you
of the time, place and purposes of an Annual Meeting of the Shareholders of
Tax-Free Trust of Oregon (the "Trust"), the only series of the Cascades Trust.
The purpose of this Proxy Statement is to give you information on which you may
base your decisions as to the choices, if any, you make in voting.
The Trust's Manager (the "Manager") is Aquila Investment Management LLC,
380 Madison Avenue, Suite 2300, New York, NY 10017, a subsidiary of the Trust's
founder, Aquila Management Corporation. The Trust's principal underwriter (the
"Distributor") is Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New
York, NY 10017. The Trust's Investment Sub-Adviser is U.S. Bancorp Asset
Management, Inc. (the "Sub-Adviser"), 555 S.W. Oak Street, Portland, Oregon
97204.
A copy of the Trust's most recent annual report will be sent to you without
charge upon written request to the Distributor, at the above address, or by
calling 800-437-1020 toll-free or 212-697-6666.
This Notice and Proxy Statement are first being mailed on or about March 6,
2006.
You should read this Proxy Statement prior to voting. If your shares are
registered in the name of your broker or someone other than yourself, you may
authorize that person to vote your shares. If your shares are registered in your
name, then you may vote in one of three ways:
(1) Proxy Card
The enclosed proxy card authorizes the persons named (or their substitutes)
to vote your shares; the Trust calls these persons the "proxy holders." As to
the election of Trustees you may authorize the proxy holders to vote your shares
for the entire slate indicated below by marking the appropriate box on the proxy
card or by merely signing and returning your proxy card with no instructions. Or
you may withhold the authority of the proxy holders to vote on the election of
Trustees by marking the appropriate box. Also, you may withhold that authority
as to any particular nominee by following the instructions on the proxy card.
As to the other matter listed on the proxy card, you may direct the proxy
holders to vote your shares on this proposal by marking the appropriate box
"For" or "Against" or instruct them not to vote your shares on the proposal by
marking the "Abstain" box. If you return your signed proxy card and do not mark
a box on the proposal, the proxy holders will vote your shares for that
proposal.
(2) Internet Voting
To vote your shares by the Internet, please contact the Trust at the
Internet address shown on your proxy card. You will be prompted to enter the
control number on your proxy card. Follow the instructions on the screen, using
your proxy card as a guide. If you vote by the Internet, you need not return the
proxy card by mail.
(3) Telephone Voting
To vote your shares by telephone, call the toll-free number on your proxy
card. You will be prompted to enter the control number on your proxy card.
Follow the recorded instructions using your proxy card as a guide. If you vote
by phone, you need not return the proxy card by mail.
General Information
You may end the power of the proxy holders to vote your shares by: (i) so
notifying the Trust in writing; (ii) signing a new and different proxy card (if
the Trust receives it before the old one is used); (iii) voting your shares at
the meeting in person or by your duly appointed agent; or (iv) calling the toll
free number provided or contacting the Trust's Internet address, both of which
are detailed on your proxy card, entering your control number and revoking your
previous vote.
Proxies for shares held by brokers in "street name" and not voted or marked
as abstentions will be counted for purposes of determining a quorum. They will
be counted as present in determining voting results, and will therefore have the
same effect as negative votes.
The Trust is sending you this Notice and Proxy Statement in connection with
the solicitation by its Trustees of proxies to be used at the Annual Meeting to
be held at the time and place and for the purposes indicated in the Notice or
any adjourned meeting or meetings. Whenever it is stated in this Proxy Statement
that a matter is to be acted on at the Meeting, this means the Meeting held at
the scheduled time or any adjourned meeting or meetings.
The Trust pays the costs of the solicitation. Proxies are being solicited
by the use of the mails; they may also be solicited by telephone, facsimile and
personal interviews. Brokerage firms, banks and others may be requested to
forward this Notice and Proxy Statement to beneficial owners of the Trust's
shares so that these owners may authorize the voting of their shares. The Trust
will pay these firms their out-of-pocket expenses for doing so.
On the record date, the Trust had three classes of shares outstanding. All
shareholders of the Trust are entitled to vote at the meeting. Each shareholder
on the record date is entitled to one vote for each dollar (and a proportionate
fractional vote for each fraction of a dollar) of net asset value (determined as
of the record date) represented by full and fractional shares of any class held
on the record date. On the record date, the net asset value per share of each of
the Trust's outstanding classes of shares was as follows: Class A Shares,
$10.86; Class C Shares, $10.86; and Class Y Shares, $10.86. The meeting is
expected to act only upon matters that affect the Trust as a whole: the election
of Trustees and the selection of an independent registered public accounting
firm. On matters that affect the Trust as a whole, all shareholders of the
Trust, including the shareholders of all classes of shares of the Trust, are
entitled to vote at the meeting.
On the record date, the total number of shares outstanding for each class
of shares was as follows: Class A Shares, 33,755,166; Class C Shares, 3,732,277;
and Class Y Shares, 3,191,891.
On the record date, the following holders held 5% or more of a class of the
Trust's outstanding shares. On the basis of information received from the
institutional holders, the Trust's management believes that all of the shares
indicated are held by them for the benefit of clients.
Name and address Number of shares Percent of class
of the holder of record
Institutional 5% shareholders
Merrill, Lynch,
Pierce, Fenner &
Smith, Inc.,
4800 Deer Lake
Drive East,
Jacksonville, FL 395,662 Class C Shares 10.60%
211,685 Class Y Shares 6.63%
South Valley Bank and
Trust
P.O. Box 1784
Medford, OR 430,159 Class Y Shares 13.48%
Additional 5% shareholders
The Trust's management is not aware of any other person beneficially owning
more than 5% of any class of its outstanding shares as of such date.
Election of Trustees
(Proposal No. 1)
At the Meeting, eight Trustees are to be elected. Each Trustee elected will
serve until the next annual meeting or until his or her successor is duly
elected. The nominees selected by the Trustees are named in the table below. See
"Introduction" above for information as to how you can vote your shares in the
election of Trustees.
The following material includes information about each nominee and each
officer of the Trust. All shares of the Trust listed as owned by the Trustees
are Class A Shares unless indicated otherwise. All of the nominees are presently
Trustees and were elected by the shareholders in May, 2005. All nominees have
consented to serve if elected.
Nominees(1)
Number of
Portfolios Other Directorships
Positions Held in Fund Held by Trustee
with Trust and Complex (The position held is a
Name, Address(2) and Length of Principal Occupation(s) Overseen directorship unless indicated
Date of Birth Service(3) During Past 5 Years by Trustee otherwise.)
Interested
Trustees(4)
Diana P. Herrmann Trustee Vice Chair and Chief Executive 11 None
New York, NY since 1994, Officer of Aquila Management
(02/25/58) President Corporation, Founder of the
since 1998, Aquilasm Group of Funds(5) and
and Vice parent of Aquila Investment
Chair of the Management LLC, Manager since
Board since 2004, President and Chief
2003 Operating Officer since 1997, a
Director since 1984, Secretary
since 1986 and previously its
Executive Vice President,
Senior Vice President or Vice
President, 1986-1997; Chief
Executive Officer and Vice
Chair since 2004 and President,
Chief Operating Officer and
Manager of the Manager since
2003; Vice Chair, President,
Executive Vice President or
Senior Vice President of funds
in the Aquilasm Group of Funds
since 1986; Director of the
Distributor since 1997;
trustee, Reserve Money-Market
Funds, 1999-2000 and Reserve
Private Equity Series,
1998-2000; Governor, Investment
Company Institute and head of
its Small Funds Committee since
2004; active in charitable and
volunteer organizations.
John W. Mitchell Trustee Principal of M & H Economic 1 None
Portland, OR since 1999 Consultants; Economist, Western
(07/13/44) Region, for U. S. Bancorp since
1998; Chief Economist, U.S. Bancorp,
Portland, Oregon, 1983-1998; member,
Oregon Governor's Council of Economic
Advisors, 1984-1998; Chairman, Oregon
Governor's Technical Advisory Committee
for Tax Review in 1998.
Non-interested
Trustees
James A. Gardner Chair of President, Gardner Associates, an 1 None
Terrebonne, OR Board of investment and real estate firm,
(07/22/43) Trustees since 1989; Partner, Ranch of the
since 2005 Canyons, a real estate firm, since
and Trustee 1991; President Emeritus, Lewis
since 1986 and Clark College and Law School;
director, Oregon High Desert Museum since
1989, Vice Chairman since 2002; active in
civic, business, educational and church
organizations in Oregon.
Gary C. Cornia Trustee Director, Romney Institute of 4 None
Orem, UT since 2002 Public Management, Marriott
(06/24/48) School of Management, Brigham
Young University, 2004 - present;
Professor, Marriott School of Management,
1980 - present; Past President, the
National Tax Association; Fellow, Lincoln
Institute of Land Policy, 2002-2003;
Associate Dean, Marriott School of
Management, Brigham Young University,
1991-2000; Utah Governor's Tax Review
Committee since 1993.
Edmund P. Jensen Trustee President and CEO, VISA 1 BMG-Seltec, a software
Portland, OR since 2003 International, 1994-1999; company; Portland Family of
(4/13/37) director: Phoenix Technologies, Funds, a community investment
a Tech/BIOS company, 2000-2005; bank.
Corillian Corp., a banking
software company, 2000-2002;
Trintech, a payment software
company, 1999-2002.
Timothy J. Leach Trustee Regional Chief Executive 2 None
Orinda, CA since 2005 Officer, US Trust Company, N.A.,
(08/28/55) 2004-present; Executive Vice
President & Chief Investment
Officer, Private Asset
Management Group, Wells Fargo
Bank, San Francisco, CA,
1999-2003; President and Chief
Investment Officer, ABN Amro
Asset Management (USA),
1998-1999; President & Chief
Investment Officer, Qualivest
Capital Management Inc. and
Senior Vice President & Chief
Investment Officer, Trust &
Investment Group, US Bancorp,
Portland, OR, 1994-1998; Trustee
of Tax-Free Trust of Oregon,
2001-2002.
Ralph R. Shaw Trustee President, Shaw Management 1 Schnitzer Steel Industries,
Portland, OR since 2000 Company, an investment Inc., Magni Systems, Inc.,
(08/23/38) counseling firm, since 1980, Telestream, Inc., BMG Seltec
General Partner, Shaw Venture Corporation, Rentrak
Partners since 1983, Shaw Corporation, Portland Family
Venture Partners II since 1987 of Funds.
and Shaw Venture Partners III
since 1994 (US Bancorp, parent
of the Sub-Adviser, is a limited
partner in the last three
ventures).
Nancy Wilgenbusch Trustee President, Marylhurst University 1 Chair, Oregon Regional
Marylhurst, OR since 2002 since 1984; member, former Advisory Board for PacifiCorp;
(09/17/47) Chair, Portland Branch of the West Coast Bank's Board;
Federal Reserve Bank of San director, Cascade Corporation,
Francisco; active board member a leading international
of a number of civic manufacturer of lift truck
organizations. attachments; director,
Scottish Power.
Other Individuals
Trustees Emeritus(6)
Lacy B. Herrmann Founder and Founder and Chairman of the N/A N/A
New York, NY Chairman Board, Aquila Management
(05/12/29) Emeritus Corporation, the sponsoring
since 2005; organization and parent of the
Chairman of Manager or Administrator and/or
the Board of Adviser or Sub-Adviser to each
Trustees fund of the Aquilasm Group of
1985-2004 Funds; Chairman of the Manager
and Trustee, or Administrator and/or Adviser
1985-2005 or Sub-Adviser to each since
2004; Founder and Chairman
Emeritus of Hawaiian Tax-Free
Trust, Pacific Capital Cash
Assets Trust, Pacific Capital
Tax-Free Cash Assets Trust,
Pacific Capital U.S. Government
Securities Cash Assets Trust,
Tax-Free Fund of Colorado,
Churchill Tax-Free Fund of
Kentucky, Narragansett Insured
Tax-Free Income Fund, Tax-Free
Trust of Arizona, Tax-Free Trust
of Oregon, Tax-Free Fund For
Utah and Aquila Rocky Mountain
Equity Fund; previously Chairman
and a Trustee of each fund in
the Aquilasm Group of Funds
since its establishment until
2004 or 2005; Director of the
Distributor since 1981 and
formerly Vice President or
Secretary, 1981-1998; Trustee
Emeritus, Brown University and
the Hopkins School; active in
university, school and
charitable organizations.
David B. Frohnmayer Trustee President, University of Oregon N/A N/A
Eugene, OR Emeritus since 1994; former Dean of the
(07/09/40) since 2003 University of Oregon Law School
and former Attorney General of
the State of Oregon; Trustee,
Tax-Free Trust of Oregon,
1997-2003.
Raymond H. Lung Trustee Retired; trustee, Qualivest N/A N/A
Portland, OR Emeritus Group of Funds, 1994-1997;
(12/24/26) since 2005 former Executive Vice President
and Executive Trust Officer, U.S.
National Bank of Oregon; previously
active in bank trade organizations and
director of certain Pacific Northwest
companies; Trustee, Tax-Free Trust of
Oregon, 1992-2005.
Patricia L. Moss Trustee President and Chief Executive N/A N/A
Bend, OR Emeritus Officer, Cascade Bancorp and
(07/23/53) since 2005 Bank of the Cascades since 1998;
Trustee, Tax-Free Trust of
Oregon, 2002-2005; active in
community and educational
organizations.
Officers
Charles E. Executive Executive Vice President of all N/A N/A
Childs, III Vice funds in the Aquilasm Group of
New York, NY President Funds and the Manager and the
(04/01/57) since 2003 Manager's parent since 2003;
formerly Senior Vice President,
corporate development, Vice
President, Assistant Vice
President and Associate of the
Manager's parent since 1987;
Senior Vice President, Vice
President or Assistant Vice
President of the Aquila
Money-Market Funds, 1988-2003.
James M. McCullough Senior Vice Senior Vice President or Vice N/A N/A
Portland, OR President President of Aquila Rocky
(06/11/45) since 1999 Mountain Equity Fund and two
Aquila Bond Funds; Senior Vice
President of the Distributor
since 2000; Director of Fixed
Income Institutional Sales, CIBC
Oppenheimer & Co. Inc., Seattle,
WA, 1995-1999.
Jerry G. McGrew Senior Vice President of the Distributor N/A N/A
New York, NY President since 1998, Registered Principal
(06/18/44) since 2002 since 1993, Senior Vice
President, 1997-1998 and Vice
President, 1993-1997; Senior
Vice President, Aquila Rocky
Mountain Equity Fund and five
Aquila Bond Funds since 1995;
Vice President, Churchill Cash
Reserves Trust, 1995-2001.
Sally J. Church Vice Vice President, Tax-Free Trust N/A N/A
Portland, OR President of Oregon since 2002 and
(10/17/48) since 2002 1989-1997; retired, 1997-2002;
Vice President of Aquila
Cascadia Equity Fund, 1996-1997.
Christine L. Neimeth Vice Vice President of Aquila Rocky N/A N/A
Portland, OR President Mountain Equity Fund and
(02/10/64) since 1998 Tax-Free Trust of Oregon;
Management Information Systems
consultant, Hillcrest Ski and
Sport, 1997; Institutional
Municipal Bond Salesperson,
Pacific Crest Securities, 1996;
active in college alumni and
volunteer organizations.
Robert W. Anderson Chief Chief Compliance Officer of the N/A N/A
New York, NY Compliance Trust, the Manager and the
(08/23/40) Officer Distributor since 2004,
since 2004 Compliance Officer of the
and Manager or its predecessor and
Assistant current parent since 1998 and
Secretary Assistant Secretary of the
since 2000 Aquilasm Group of Funds since
2000.
Joseph P. DiMaggio Chief Chief Financial Officer of the N/A N/A
New York, NY Financial Aquilasm Group of Funds since
(11/06/56) Officer 2003 and Treasurer since 2000.
since 2003
and
Treasurer
since 2000
Edward M. W. Hines Secretary Partner, Hollyer Brady Barrett & N/A N/A
New York, NY since 1985 Hines LLP, legal counsel to the
(12/16/39) Trust, since 1989; Secretary of the
Aquilasm Group of Funds.
John M. Herndon Assistant Assistant Secretary of the N/A N/A
New York, NY Secretary Aquilasm Group of Funds since
(12/17/39) since 1995 1995 and Vice President of the
three Aquila Money-Market Funds since
1990; Vice President of the Manager or
its predecessor and current parent since
1990.
Lori A. Vindigni Assistant Assistant Treasurer of the N/A N/A
New York, NY Treasurer Aquilasm Group of Funds since
(11/02/66) since 2000 2000; Assistant Vice President
of the Manager or its predecessor and
current parent since 1998; Fund
Accountant for the Aquilasm Group of
Funds, 1995-1998.
(1 ) The Trust's Statement of Additional Information includes additional
information about the Trustees and is available, without charge, upon request by
calling 800-437-1020 (toll free).
(2) The mailing address of each Trustee and officer is c/o Tax-Free Trust of
Oregon, 380 Madison Avenue, New York, NY 10017.
(3) Each Trustee holds office until the next annual meeting of shareholders or
until his or her successor is elected and qualifies. The term of office of each
officer is one year.
(4) Ms. Herrmann is an interested person of the Trust as an officer of the
Trust, as a director, officer and shareholder of the Manager's corporate parent,
as an officer and Manager of the Manager, and as a shareholder and director of
the Distributor. Mr. Mitchell is an interested person as a security holder and
an employee of the Sub-Adviser's parent.
(5) In this material Pacific Capital Cash Assets Trust, Pacific Capital U.S.
Government Securities Cash Assets Trust and Pacific Capital Tax-Free Cash Assets
Trust, each of which is a money-market fund, are called the "Aquila Money-Market
Funds"; Hawaiian Tax-Free Trust, Tax-Free Trust of Arizona, Tax-Free Trust of
Oregon, Tax-Free Fund of Colorado, Churchill Tax-Free Fund of Kentucky,
Narragansett Insured Tax-Free Income Fund and Tax-Free Fund For Utah, each of
which is a tax-free municipal bond fund, are called the "Aquila Bond Funds";
Aquila Rocky Mountain Equity Fund is an equity fund; considered together, these
11 funds are called the "Aquilasm Group of Funds."
(6) A Trustee Emeritus may attend Board meetings but has no voting power.
Securities Holdings of the Trustees
(as of 12/31/05)
Dollar Range of Aggregate Dollar Range of Ownership in
Name of Ownership in Tax-Free the Aquilasm Group of Funds
Trustee Trust of Oregon(1) Overseen by Trustee(1)
- ------- --------------- -------------------
Interested Trustees
Diana P. Herrmann B E(2)
John W. Mitchell C C
Non-interested Trustees
James A. Gardner C C
Gary C. Cornia C E
Edmund P. Jensen C C
Timothy J. Leach B B
Ralph R. Shaw C C
Nancy Wilgenbusch C C
(1) A. None
B. $1-$10,000
C. $10,001-$50,000
D. $50,001-$100,000
E. over $100,000
(2) As of January 9, 2006.
None of the non-interested Trustees or their immediate family members holds
of record or beneficially any securities of the Manager, the Sub-Adviser or the
Distributor.
The Trust does not currently pay fees to any of the Trust's officers or to
Trustees affiliated with the Manager or the Sub-Adviser. For its fiscal year
ended September 30, 2005, the Trust paid a total of $254,775 in compensation and
reimbursement of expenses to the Trustees. No other compensation or remuneration
of any type, direct or contingent, was paid by the Trust to its Trustees.
The Trust is one of the 11 funds in the Aquilasm Group of Funds, which
consist of tax-free municipal bond funds, money-market funds and an equity fund.
The following table lists the compensation of all nominees for Trustee who
received compensation from the Trust or from other funds in the Aquilasm Group
of Funds during the Trust's fiscal year. None of such Trustees has any pension
or retirement benefits from the Trust or any of the other funds in the Aquila
Group of Funds.
Compensation
from all Number of
funds in the boards on
Compensation Aquilasm which the
From the Group of Trustee now
Name Trust Funds serves
James A.
Gardner $40,800 $40,800 1
Gary C.
Cornia $24,000 $65,000 4
Edmund P.
Jensen $23,500 $23,500 1
Timothy J.
Leach $12,500 $19,500 2
John W.
Mitchell $24,500 $24,500 1
Ralph R.
Shaw $34,250 $34,250 1
Nancy
Wilgenbusch $21,500 $21,500 1
Class A Shares may be purchased without a sales charge by certain of the
Trust's Trustees and officers.
The Trust's Manager is a wholly-owned subsidiary of Aquila Management
Corporation ("AMC"), founder of each fund in the Aquilasm Group of Funds. As of
January 31, 2006, these funds had aggregate assets of approximately $4.4
billion, of which approximately $2.4 billion consisted of assets of the tax-free
municipal bond funds. AMC's address is the same as that of the Manager. AMC is
controlled by Mr. Lacy B. Herrmann, through share ownership directly, through
two trusts and by his wife. During the fiscal year ended September 30, 2005, the
Trust paid $1,788,408 in management fees.
During the fiscal year ended September 30, 2005, $551,898 was paid under
Part I of the Trust's Distribution Plan to Qualified Recipients with respect to
the Class A Shares, of which $25,396 was retained by the Distributor. With
respect to Class C Shares, during the same period $322,743 was paid under Part
II of the Plan and $107,581 was paid under the Shareholder Services Plan. Of
these total payments of $982,222, the Distributor received $113,394. All of
such payments were for compensation.
The Distributor currently handles the distribution of the shares of the
funds in the Aquilasm Group of Funds, including the Trust. Under the
Distribution Agreement, the Distributor is responsible for the payment of
certain printing and distribution costs relating to prospectuses and reports as
well as the costs of supplemental sales literature, advertising and other
promotional activities. The shares of the Distributor are owned 24% by Diana P.
Herrmann, 72% by Mr. Herrmann and other members of his immediate family, and the
balance by employees of Aquila Investment Management LLC.
Other Information on Trustees
The Trustees have appointed a standing Audit Committee consisting of all of
the Trustees who are "independent" and are not "interested persons" of the
Trust, as that term is defined in the Investment Company Act of 1940. The
members of the Audit Committee are Gary C. Cornia, James A. Gardner, Edmund P.
Jensen, Timothy J. Leach, Ralph R. Shaw and Nancy Wilgenbusch. The Committee (i)
selects the Trust's independent registered public accounting firm (subject to
shareholder ratification); (ii) reviews the methods, scope and result of audits
and the fees charged; and (iii) reviews the adequacy of the Trust's internal
accounting procedures and controls. Selection of the independent registered
public accounting firm is also ratified by the Board of Trustees. The Audit
Committee held five meetings during the Trust's last fiscal year. The Board of
Trustees has adopted a written charter for the Audit Committee.
During the Trust's last fiscal year, the Board of Trustees held four
meetings. Each current Trustee was present for at least 75% of the total number
of Board meetings.
The Trust's policy is that all Trustees who can do so attend the Annual
Meeting.
The Trust has a Nominating Committee, consisting of all of the Independent
Trustees. The Nominating Committee held three meetings during the last fiscal
year. The committee will consider nominees recommended by the shareholders who
may send recommendations to the committee in care of the Manager at 380 Madison
Avenue, New York, NY 10017. The charter of the Nominating Committee is available
on the Trust's website at www.aquilafunds.com.
Since the beginning of the Trust's most recently completed fiscal year, no
Trustee purchased or sold more than 1% of the outstanding shares of any class of
shares of the Manager, Sub-Adviser or the parents or subsidiaries of either.
Vote Required
To be elected, each nominee must receive the affirmative votes of a
majority of the shares present.
Ratification or Rejection
of Selection of
Independent Registered Public Accounting Firm
(Proposal No. 2)
Tait, Weller & Baker LLP ("TWB") has been selected as the Trust's
independent registered public accounting firm for the fiscal year ending
September 30, 2006 by the Trust's Audit Committee. The selection has been
ratified by the Board of Trustees, including a majority of the Independent
Trustees.
TWB has concentrated its accounting practice primarily in the mutual
fund industry for more than 40 years and is one of the industry's largest
providers. TWB was selected by the Audit Committee to perform the audit for the
fiscal year ended September 30, 2005.
KPMG LLP ("KPMG") had served as the Trust's independent registered
public accounting firm for all of the Trust's fiscal years from its inception
through its fiscal year ended 2004. KPMG resigned in mid-2005. KPMG's reports on
the Trust's financial statements, including those for the Trust's two most
recent fiscal years, contained no adverse opinion or disclaimer of opinion. No
reports were qualified or modified as to uncertainty, audit scope, or accounting
principles. Since inception and including the last two fiscal years and the
subsequent period through the date of its resignation, there have been no
disagreements with KPMG on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, and there were
no reportable events of the kinds required to be disclosed under regulations
applicable to proxy statements.
The following table represents fees for professional audit services
rendered by TWB for the audit of the Trust's annual financial statements for the
fiscal year ended September 30, 2005 and those of KPMG for the audit of the
Trust's annual financial statements for the fiscal year ended September 30,
2004, and fees billed for other services rendered by TWB and KPMG.
2004 2005
Audit Fees $20,700 $18,000
Audit related fees 0 0
------- -------
Audit and audit related fees 20,700 18,000
Tax fees (1) 8,100 3,000
All other fees 0 0
------ ------
Total $28,800 $21,000
====== ======
(1) Tax fees consisted of fees for tax consultation and tax compliance services.
Neither TWB nor KPMG performed any services during the fiscal year for
the Trust's investment adviser (the Manager) or any entity controlling,
controlled by or under common control with the Manager that provides services to
the Trust.
All audit and non-audit services performed by either TWB or KPMG on
behalf of the Trust or non-audit services performed on behalf of affiliated
entities within the investment company complex where such engagement relates
directly to the operations and financial reporting of the Trust are pre-approved
by the Audit Committee. Services to be considered between meetings of the
Committee are pre-approved by a selected member of the Committee in accordance
with applicable regulations and subject to additional procedures established by
the Committee.
The Audit Committee reviewed all services performed and fees charged by
TWB and accepted its representation that it was independent with respect to its
audit of the Trust's financial statements for the year ended September 30, 2005.
The Audit Committee has reviewed all services to be performed and fees to be
charged by TWB and in recommending appointment of TWB for the fiscal year ending
September 30, 2006 has accepted its representation that it is independent.
It is expected that representatives of TWB will not be present at the
meeting but representatives of the firm will be available should any matter
arise requiring their advice.
Vote Required
Approval requires the affirmative votes of a majority of the shares
present.
Shareholder Proposals
Under the proxy rules of the Securities and Exchange Commission,
shareholder proposals meeting tests contained in those rules may, under certain
conditions, be included in the Trust's proxy statement and proxy card for a
particular annual meeting. One of these conditions relates to the timely receipt
by the Trust of any such proposal. Under these rules, proposals submitted for
inclusion in the proxy material for the Trust's next annual meeting after the
meeting to which this Proxy Statement relates must be received by the Trust not
less than 120 days before the anniversary of the date of this Proxy Statement.
Accordingly, a shareholder proposal intended to be presented at the Trust's 2007
annual meeting must be received by the Trust by November 6, 2006 in order to be
included in the Trust's proxy material relating to that meeting. The date for
such submission could change, depending on the scheduled date for the next
annual meeting; if so, shareholders will be notified.
The fact that the Trust receives a shareholder proposal in a timely manner
does not insure its inclusion in the Trust's proxy material, since there are
other requirements in the proxy rules relating to such inclusion.
A shareholder wishing to provide notice of a proposal in the manner
prescribed by Rule 14a-4 (c)(1) under the Securities Exchange Act of 1934 must
submit written notice of the proposal to the Trust by January 19, 2007.
Other Business
The Trust does not know of any other matter which will come up for action
at the Meeting. If any other matter or matters properly come up for action at
the Meeting, including any adjournment of the Meeting, the proxy holders will
vote the shares which your proxy card, Internet or telephone vote entitles them
to vote, in accordance with their judgment on such matter or matters, except as
noted. That is, by signing and returning your proxy card or by voting by the
Internet or telephone, you give the proxy holders discretionary authority as to
any such matter or matters.
<page>
IMPORTANT NOTICE
PLEASE READ IMMEDIATELY
Tax-Free Trust of Oregon
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held on April 10, 2006
PROXY STATEMENT
TAX-FREE TRUST OF OREGON
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
INTERNET VOTING
www.proxyvote.com/aquila
To vote your shares by the Internet, contact the Trust at
www.proxyvote.com/aquila. Follow the simple instructions at the website, using
this proxy card as a guide. If you vote by the Internet, you need not return the
proxy card by mail.
TELEPHONE VOTING
1-877-587-0761
To vote your shares by telephone, call toll free 1-877-587-0761. Follow the
simple recorded instructions using this proxy card as a guide. If you vote by
phone, you need not return the proxy card by mail.
VOTE BY MAIL
You can vote your shares by completing and returning this proxy card. Please
mark this proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.
TO VOTE: MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
TAX-FREE TRUST OF OREGON
1. Election of Trustees Nominees: (01) Gary C. Cornia (02) James A. Gardner (03)
Diana P. Herrmann* (04) Edmund P. Jensen (05) Timothy J. Leach (06) John W.
Mitchell* (07) Ralph R. Shaw (08) Nancy Wilgenbusch
* Interested Trustees
For All Withhold All For All Except
[ ] [ ] [ ]
INSTRUCTION: To withhold authority to vote for one or more (but not all)
nominees, mark "FOR ALL EXCEPT" and write the nominee number(s) and/ or name(s)
on the line below.
- --------------------
[sentences below bolded in printed form]
Management recommends a vote FOR all nominees listed above and FOR the proposal
listed below. The shares represented hereby will be voted as indicated at right
or FOR if no choice is indicated.
2. Action on selection of Tait, Weller & Baker LLP as independent registered
public accounting firm. (Proposal No.2 in Proxy Statement)
For Against Abstain
[ ] [ ] [ ]
As to any other matter said proxies shall vote in accordance with their best
judgment.
For address changes and/or comments, please check this box and write them on
the back where indicated. _
[_]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS PROXY CARD. When signing
as a custodian, attorney, executor, administrator, trustee, guardian, etc.,
please sign your full title as such. Joint owners should each sign.
- ----------------------------------------- ----
Signature(s) (PLEASE SIGN WITHIN THE BOX) Date
Yes No
I plan to attend the annual meeting in Portland. [ ] [ ]
I plan to attend the outreach meeting in Bend. [ ] [ ]
Aquilasm Group of Funds
TAX-FREE TRUST OF OREGON
Proxy for Shareholder Meeting - April 10, 2006
Proxy Solicited on Behalf of the Board of Trustees
The shareholder(s) of Tax-Free Trust Of Oregon (the "Trust") whose
signature(s)appear(s) on the reverse does/do hereby appoint DIANA P. HERRMANN,
CHARLES E. CHILDS, III and EDWARD M. W. HINES, or any of them, as attorneys and
proxies of the undersigned, with full power of substitution, to attend the
Annual Meeting of Shareholders of the Trust to be held on Monday, April 10, 2006
at the World Forestry Center, 4033 SW Canyon Road, Portland, Oregon, at 1:00
p.m. Pacific Daylight Time, and at all adjournments thereof, and thereat to vote
the shares held in the name of the undersigned on the record date for said
meeting on the matters listed on the reverse side. Such shares are entitled to
one vote for every dollar of net asset value represented by the share balance
printed on the reverse.
Please read the proxy statement prior to voting.
Annual Meeting Attendance - You are encouraged to attend the Annual Meeting of
Shareholders. If you can attend, please so indicate on the proxy card or e-mail
us at info@aquilafunds.com
Address Changes/Comments: -------------------------------
- ---------------------------------------------------------
- ---------------------------------------------------------
(If you noted any Address Changes/Comments above, please mark corresponding box
on the reverse side.)
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND
DATED ON THE REVERSE SIDE.