Important Notice
Please Read Immediately
Aquilasm
Group of Funds
Narragansett Insured Tax-Free Income Fund
380 Madison Avenue, Suite 2300, New York, N Y 10017
Notice of Annual Meeting of
Shareholders to be held
on November 7, 2001
To Shareholders of the Fund:
The purpose of this Notice is to advise you that an Annual Meeting of the
Shareholders of Narragansett Insured Tax-Free Income Fund (the "Fund") will be
held:
Place: (a) at the Rhode Island Convention Center
1 Sabin Street
Providence, Rhode Island;
Time: (b) on November 7, 2001
at 2:30 p.m. local time;
Purposes: (c) for the following purposes:
(i) to elect six Trustees; each Trustee elected will hold
office until the next annual meeting of the Fund'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 KPMG LLP as the Fund's independent auditors for the
fiscal year ending June 30, 2002, (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 Fund's records at the close of
business on August 16, 2001 (the "record date").
Also, the number of shares of each of the Fund'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
September 26, 2001
Please Note:
If you do not expect to attend the Meeting, please vote by any of three ways: by
telephone, by Internet or by completing the enclosed proxy card and returning it
in the accompanying stamped envelope. To avoid unnecessary expense to the Fund,
we request your cooperation in voting no matter how large or small your holding
may be.
Narragansett Insured Tax-Free Income Fund
380 Madison Avenue, Suite 2300, New York, N Y 10017
Proxy Statement
Introduction
The purpose of the Notice (the first two pages of this document) is to
advise you of the time, place and purposes of an Annual Meeting of the
Shareholders of Narragansett Insured Tax-Free Income Fund (the "Fund"). The
purpose of this Proxy Statement (all the rest of this document) is to give you
information on which you may base your decisions as to the choices, if any, you
make in voting.
A copy of the Fund's most recent annual report and most recent
semi-annual report will be sent to you without charge upon written request to
the Fund's Distributor, Aquila Distributors, Inc., 380 Madison Avenue, Suite
2300, New York, NY 10017 or by calling 800-437-1020 toll-free or 212-697-6666.
The Fund's founder and Manager (the "Manager") is Aquila Management
Corporation, 380 Madison Avenue, Suite 2300, New York, NY 10017. The Fund's
principal underwriter (the "Distributor") is Aquila Distributors, Inc., 380
Madison Avenue, Suite 2300, New York, NY 10017. The Fund's Investment
Sub-Adviser is Citizens Investment Advisors, a department of Citizens Bank of
Rhode Island (the "Sub-Adviser"), One Citizens Plaza, Providence, RI 02903.
This Notice and Proxy Statement are first being mailed on or about
September 26, 2001.
You should read this Proxy Statement prior to voting. 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 Fund 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 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) 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.
(3) Internet Voting
To vote your shares by the Internet, please contact the Fund 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.
General Information
You may end the power of the proxy holders to vote your shares by: (i)
so notifying the Fund in writing; (ii) signing a new and different proxy card
(if the Fund 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 above or contacting the Fund's Internet address
described above, entering your control number and revoking your previous vote.
Shares held by brokers in "street name" and not voted or marked as
abstentions will not be counted for purposes of determining a quorum, voted on
any matter or otherwise counted as present in determining voting results.
The Fund 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 Fund 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
Fund's shares so that these owners may authorize the voting of their shares. The
Fund will pay these firms their out-of-pocket expenses for doing so.
On the record date, the Fund had four classes of shares outstanding.
All shareholders of the Fund 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 Fund's outstanding classes of shares was as follows: Class
A Shares, $10.44; Class C Shares, $10.44; Class Y Shares, $10.44; and Class I
Shares, $10.43. The meeting is expected to act only upon matters that affect the
Fund as a whole: the election of Trustees and the selection of independent
auditors. On matters that affect the Fund as a whole, all shareholders of the
Fund, including the shareholders of all classes of shares of the Fund, 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, 6,695,303; Class C Shares,
713,159; Class Y Shares, 353,000; and Class I Shares, 13,050.
On the record date, the following holders held 5% or more of the Fund's
outstanding shares. On the basis of information received from the institutional
holders the Fund'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
National Financial
Services Corp.
200 Liberty Street,
New York, NY 671,674 Class A Shares 10.0%
Fiserv Securities, Inc.
One Commerce Square,
2005 Market Street
Philadelphia, PA 982,955 Class A Shares 14.7%
101,213 Class C Shares 14.2%
Merrill Lynch,
Pierce, Fenner & Smith,
Inc. 4800 Deer Lake Drive
East, Jacksonville, FL 373,151 Class A Shares 5.6%
100,774 Class C Shares 14.1%
LPL Financial Services
9785 Towne Centre Dr.
San Diego, CA 82,525 Class C Shares 11.6%
Citizens Bank
870 Westminster Street,
Providence, RI 174,503 Class Y Shares 49.4%
Donaldson Lufkin
Jenrette Securities
Corporation
P.O. Box 2052,
Jersey City, NJ 111,207 Class Y Shares 31.5%
Advest Inc.
90 State House Sq.
Hartford, CT 31,589 Class Y Shares 9.0%
Perry Baker & Co.
The Washington Trust Company
23 Broad
Westerly, RI 13,050 Class I Shares 100%
The Fund'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, six 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.
All of the nominees are presently Trustees and were elected by the
shareholders in September, 2000. The Trustees and officers as a group own less
than 1% of the outstanding shares of the Fund. In the material below and
elsewhere in this Proxy Statement, Aquila Management Corporation is referred to
as the "Manager" and the Fund's Distributor, Aquila Distributors, Inc., is
referred to as the "Distributor." Mr. Herrmann is an interested person of the
Fund as that term is defined in the Investment Company Act of 1940 (the "1940
Act") as an officer of the Fund and a director, officer and shareholder of the
Manager and the Distributor. Mr. Duffy is an interested person as a director of
the Sub-Adviser. They are so designated by an asterisk.
In the following material 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 (this Fund) and
Tax-Free Fund For Utah, each of which is a tax-free municipal bond fund, are
called the "Aquila Bond Funds"; Pacific Capital Cash Assets Trust, Pacific
Capital U.S. Government Securities Cash Assets Trust, Pacific Capital Tax-Free
Cash Assets Trust, Capital Cash Management Trust and Capital Cash U.S.
Government Securities Trust, each of which is a money-market fund, are called
the "Aquila Money-Market Funds"; and Aquila Cascadia Equity Fund and Aquila
Rocky Mountain Equity Fund are called the "Aquila Equity Funds."
The following material includes the name, positions with the Fund,
address and age as of the record date and business experience during at least
the past five years of each nominee and each officer of the Fund. All shares of
the Fund listed as owned by the Trustees are Class A Shares unless indicated
otherwise.
Name, Position Business Experience
with the Fund,
Address, Age,
Shares owned
Lacy B. Herrmann* Founder and Chairman of the Board of Aquila
Chairman of the Management Corporation, the sponsoring
Board of Trustees organization and Manager or Administrator
380 Madison Avenue and/or Adviser or Sub-Adviser to the
New York, NY Aquila Money-Market Funds, the Aquila Bond
10017 Funds and the Aquila Equity Funds,
Age: 72 and Founder, Chairman of the Board of Trustees
Shares Owned: 526(1) and (currently or until 1998) President of each
since its establishment, beginning
in 1984; Director of Aquila
Distributors, Inc., distributor of
the above funds, since 1981 and
formerly Vice President or
Secretary, 1981-1998; President and
a Director of STCM Management
Company, Inc., sponsor and
sub-adviser to Capital Cash
Management Trust and Capital Cash
U.S. Government Securities Trust;
Founder and Chairman of several
other money market funds; Director
or Trustee of OCC Cash Reserves,
Inc. and Quest For Value
Accumulation Trust, and Director or
Trustee of Oppenheimer Quest Value
Fund, Inc., Oppenheimer Quest Global
Value Fund, Inc. and Oppenheimer
Rochester Group of Funds, each of
which is an open-end investment
company; Trustee of Brown
University, 1990-1996 and currently
Trustee Emeritus; actively involved
for many years in leadership roles
with university, school and
charitable organizations.
(1) Held of record
by the Manager as
of 8/22/01.
Vernon R. Alden Director of Sonesta International Hotels
Trustee Corporation, Boston, Massachusetts and
20 Park Place General Independent Partner of the Merrill
Suite 414 Lynch-Lee Funds; Former Director of
Boston, MA Colgate-Palmolive Company, Digital Equipment
02116 Corporation, Intermet Corporation, The McGraw
Age: 78 Hill and The Mead Corporations; Chairman of the
Shares Owned: 214 Board and Executive Committee of The Boston
Company, Inc., a financial services
company, 1969-1978; Trustee of
Tax-Free Trust of Oregon since
1988, of Hawaiian Tax-Free Trust,
Pacific Capital Cash Assets Trust,
Pacific Capital Tax-Free Cash
Assets Trust and Pacific Capital
U.S. Government Securities Cash
Assets Trust since 1989, of
Cascades Cash Fund, 1989-1994, of
Narragansett Insured Tax-Free
Income Fund since 1992, and of
Aquila Cascadia Equity Fund since
1996; Associate Dean and member of
the faculty of Harvard University
Graduate School of Business
Administration, 1951-1962; member
of the faculty and Program Director
of Harvard Business School -
University of Hawaii Advanced
Management Program, summer of 1959
and 1960; President of Ohio
University, 1962-1969; Chairman of
The Japan Society of Boston, Inc.,
and member of several Japan-related
advisory councils; Chairman of the
Massachusetts Business Development
Council and the Massachusetts
Foreign Business Council,
1978-1983; Trustee Emeritus, Boston
Symphony Orchestra; Chairman of the
Massachusetts Council on the Arts
and Humanities, 1972-1984; Member
of the Board of Fellows of Brown
University, 1969-1986; Trustee of
various other cultural and
educational organizations; Honorary
Consul General of the Royal Kingdom
of Thailand; received Decorations
from the Emperor of Japan (1986)
and the King of Thailand (1996 and
1997).
Paul Y. Clinton Principal of Clinton Management
Trustee Associates, a financial and venture
39 Blossom Avenue capital consulting firm; formerly
Osterville, MA Director of External Affairs of Kravco
Age: 70 Corporation, a national real estate
Shares Owned: 255 owner and developer, 1984-1995; formerly
President of Essex Management
Corporation, a management and
financial consulting company,
1979-1983; Trustee of Capital Cash
Management Trust since 1979, of
Narragansett Insured Tax-Free
Income Fund since 1996 and of Prime
Cash Fund (which is inactive) since
1993; Trustee of Short Term Asset
Reserves, 1984-1996; general
partner of Capital Growth Fund, a
venture capital partnership,
1979-1982; President of Geneve
Corp., a venture capital fund,
1970-1978; formerly Chairman of
Woodland Capital Corp., a small
business investment company;
formerly Vice President, W.R. Grace
& Co; Director or Trustee of OCC
Cash Reserves, Inc., Oppenheimer
Quest Global Value Fund, Inc.,
Oppenheimer Quest Value Fund, Inc.,
a series of Quest Funds and Trustee
of Quest For Value Accumulation
Trust, and of the Rochester Group
of Funds, each of which is an
open-end investment company; and of
the Oppenheimer Funds Inc. Mid-Cap
Fund.
David A. Duffy* Trustee of Narragansett Insured Tax-Free
Trustee Income Fund since 1995; President, Duffy &
275 Stony Lane Shanley, Inc., an advertising, marketing
North Kingstown, and public relations firm since 1973; Director
RI 02852 of Citizens Bank of Rhode Island since 1999;
Age: 62 National Chairman of the National Conference
Shares Owned: 1,091 for Community and Justice (formerly the
National Conference of Christians
and Jews); Vice Chairman of the
Providence College Board of Trustees
and Chairman of the College's
President's Council; Past Chair and
current member of the Executive
Committee of the Greater Providence
Chamber of Commerce; past Chair of
the Rhode Island Sports Council;
past Chair of the Rhode Island
Public Telecommunications Authority;
actively involved in many other
civic and non-profit organizations.
He has been the recipient of
numerous awards for public service.
He served with the U.S. Army.
William J. Chairman and founder (1975) and Senior Advisor
Nightingale since 1995 of Nightingale & Associates,
Trustee L.L.C., a general management consulting
1266 East Main Street firm focusing on interim management,
Stamford, CT divestitures, turnaround of troubled companies,
06902 corporate restructuring and financial
Age: 71 advisory services; President, Chief
Shares Owned: 765 Executive Officer and Director of Bali Company,
Inc., a manufacturer of women's
apparel, which became a subsidiary
of Hanes Corporation, 1970-1975;
prior to that, Vice President and
Chief Financial Officer of Hanes
Corporation after being Vice
President-Corporate Development and
Planning of that company,
1968-1970; formerly Senior
Associate of Booz, Allen &
Hamilton, management consultants,
after having been Marketing Manager
with General Mills, Inc.; Trustee
of Narragansett Insured Tax-Free
Income Fund since 1992 and of
Churchill Cash Reserves Trust,
1993-2001, and Churchill Tax-Free
Fund of Kentucky since 1993;
Director of Ring's End, Inc., a
building materials company, since
1989, and of Furr's Restaurant
Group, Inc., operator of a chain of
cafeteria restaurants, since 1998.
J. William Weeks Trustee of Capital Cash Management Trust since
Trustee 2001, of Narragansett Insured
210 Jamaica Lane Tax-Free Income Fund and of Tax-
Palm Beach, FL 33480 Free Fund of Colorado since 1995;
Age: 74 Senior Vice President of Tax-Free Fund
Shares Owned: 678 of Colorado and Narragansett Insured
Tax-Free Income Fund, 1992-1995;
Vice President of Hawaiian Tax-Free
Trust, Tax-Free Trust of Arizona,
Tax-Free Trust of Oregon and
Churchill Tax-Free Fund of Kentucky,
1990-1995; Senior Vice President or
Vice President of the Bond Funds and
Vice President of Short Term Asset
Reserves and Pacific Capital Cash
Assets Trust, 1984-1988; President
and Director of Weeks & Co., Inc.,
financial consultants, 1978-1988;
limited partner and investor in
various real estate partnerships
since 1988; partner of Alex. Brown &
Sons, investment bankers, 1966-1976;
Vice President of Finance and
Assistant to the President of Howard
Johnson Company, a restaurant and
motor lodge chain, 1961-1966;
formerly with Blyth & Co., Inc.,
investment bankers.
Diana P. Herrmann President and Chief Operating Officer of
President the Manager since 1997, a
380 Madison Director since 1984, Secretary since 1986
Avenue and previously its Executive Vice
New York, President, Senior Vice President
NY 10017 or Vice President, 1986-1997;
Age: 43 President of various Aquila Bond and
Money-Market Funds since 1998; Assistant
Vice President, Vice President,
Senior Vice President or Executive
Vice President of Aquila
Money-Market, Bond and Equity Funds
since 1986; Trustee of a number of
Aquila Money-Market, Bond and Equity
Funds since 1995; Trustee of Reserve
Money-Market Funds, 1999-2000 and of
Reserve Private Equity Series,
1998-2000; Assistant Vice President
and formerly Loan Officer of
European American Bank, 1981-1986;
daughter of the Fund's Chairman;
Trustee of the Leopold Schepp
Foundation (academic scholarships)
since 1995; actively involved in
mutual fund and trade associations
and in college and other volunteer
organizations.
Stephen J. Caridi Vice President of the Distributor since
Senior Vice 1995, Assistant Vice President 1988-1995,
President Marketing Associate, 1986-1988; Vice
380 Madison President of Hawaiian Tax-Free Trust since
Avenue 1998; Senior Vice President of Narragansett
New York, Insured Tax-Free Income Fund since
NY 10017 1998, Vice President since 1996; Assistant Vice
Age: 40 President of Tax-Free Fund For Utah since 1993;
Mutual Funds Coordinator of
Prudential Bache Securities,
1984-1986; Account Representative of
Astoria Federal Savings and Loan
Association, 1979-1984.
Rose F. Marotta Chief Financial Officer of the Aquila
Chief Financial Officer Money-Market, Bond and Equity Funds
380 Madison Avenue since 1991 and Treasurer, 1981-1991;
New York, NY formerly Treasurer of the predecessor of
10017 Capital Cash Management Trust; Treasurer
Age: 77 and Director of STCM Management Company,
Inc. since 1974; Chief Financial Officer
of the Manager since 1984 and of the
Distributor, 1985-2000.
Joseph P. DiMaggio Treasurer of the Aquila Money-Market,
Treasurer Bond and Equity Funds; Treasurer of Aquila
380 Madison Avenue Distributors, Inc. since 2000; Controller of
New York, NY 10017 Van Eck Global Funds, 1993-2000; Mutual
Age: 44 Fund Accounting Manager of Alliance
Capital Management L.P., 1985-1993.
Lori A Vindigni Assistant Vice President of Aquila Management
Assistant Treasurer Corporation since 1998, Fund Accountant
380 Madison Avenue for the Aquilasm Group of Funds, 1995-1998;
New York, NY Staff Officer and Fund Accountant of
10017 Citibank Global Asset Management Group of
Age: 34 Investment Companies, 1994-1995; Fund Accounting
Supervisor of Dean Witter Group of Investment
Companies, 1990-1994.
Edward M. W. Hines Partner of Hollyer Brady Smith & Hines
Secretary LLP, attorneys, since 1989 and counsel,
551 Fifth Avenue 1987-1989; Secretary of the Aquila Money-
New York, NY 10176 Market, Bond and Equity Funds since 1982.
Age: 61
Robert W. Anderson Compliance Officer of Aquila Management
Assistant Secretary Corporation since 1998 and Assistant
380 Madison Avenue Secretary of the Aquila Money-Market,
New York, NY 10017 Bond and Equity Funds since 2000;
Age: 60 Consultant, The Wadsworth Group, 1995-1998;
Executive Vice President of
Sheffield Management Company
(investment adviser and distributor
of a mutual fund group), 1986-1995.
John M. Herndon Assistant Secretary of the Aquila Money-
Assistant Secretary Market, Bond and Equity Funds since 1995
380 Madison Avenue and Vice President of the Aquila Money-
New York, NY Market Funds since 1990; Vice President of
10017 the Manager since 1990; Investment Services
Age: 61 Consultant and Bank Services Executive
of Wright Investors' Service, a
registered investment adviser,
1983-1989; Member of the American
Finance Association, the Western
Finance Association and the Society
of Quantitative Analysts.
The Fund does not currently pay fees to any of the Fund's officers or
to Trustees affiliated with the Manager or the Sub-Adviser. For its fiscal year
ended June 30, 2001 the Fund paid a total of $43,346 in compensation and
reimbursement of expenses to the Trustees. No other compensation or remuneration
of any type, direct or contingent, was paid by the Fund to its Trustees.
The Fund is one of the 14 Funds in the Aquilasm Group of Funds, which
consist of tax-free municipal bond funds, money-market funds and equity funds.
The following table lists the compensation of all nominees for Trustee who
received compensation from the Fund or from other funds in the Aquilasm Group of
Funds during the Fund's fiscal year. None of such Trustees has any pension or
retirement benefits from the Fund or any of the other funds in the Aquila group.
Compensation Number of
from all boards on
Compensation Funds which the
from the in the Trustee
Fund Aquilasm serves
Name Group of
Funds
Vernon R. Alden $4,850 $55,760 7
Paul Y. Clinton $4,850 $9,850 3
David A. Duffy $4,500 $4,500 1
William J.
Nightingale $5,850 $17,100 3
J. William Weeks $5,550 $15,050 2
Class A Shares may be purchased without a sales charge by certain of
the Fund's Trustees and officers.
The Fund's Manager is Manager or Administrator to the Aquilasm Group of
Funds, which consists of tax-free municipal bond funds, money-market funds and
equity funds. As of July 31, 2001, these funds had aggregate assets of
approximately $3.3 billion, of which approximately $1.9 billion consisted of
assets of the tax-free municipal bond funds. The Manager is controlled by Mr.
Lacy B. Herrmann, through share ownership directly, through a trust and by his
wife. During the fiscal year ended June 30, 2001,the Fund incurred management
fees of $353,164, of which $282,531 was waived and the balance was paid to the
Sub-Adviser.
During the fiscal year ended June 30, 2001, $94,257 was paid under Part
I of the Fund's Distribution Plan to Qualified Recipients with respect to the
Class A Shares, of which, $2,243 was retained by the Distributor. With respect
to Class C Shares, during the same period $38,975 was paid under Part II of the
Plan and $12,991 was paid under the Shareholder Services Plan. Of these total
payments of $51,966, the Distributor received $20,840. All of such payments were
for compensation.
The Distributor currently handles the distribution of the shares of
fourteen funds (five money-market funds, seven tax-free municipal bond funds and
two equity funds), including the Fund. 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 current employees of
Aquila Management Corporation.
Other Information on Trustees
The Trustees have appointed a standing Audit Committee consisting of
all of the Trustees (the "Independent Trustees") who are not "interested
persons" of the Fund, as that term is defined in the 1940 Act. The Committee (i)
recommends to the Board of Trustees what firm of independent auditors will be
selected by the Board of Trustees (subject to shareholder ratification); (ii)
reviews the methods, scope and result of audits and the fees charged; and (iii)
reviews the adequacy of the Fund's internal accounting procedures and controls.
The Committee held one meeting during the Fund's last fiscal year. The Board of
Trustees does not have a nominating committee. During the Fund'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 and Audit Committee
meetings (if such Trustee was a member of that committee).
Ratification or Rejection
of Selection of
Independent Auditors
(Proposal No. 2)
KPMG LLP ("KPMG"), which is currently serving as the Fund's independent
auditors, has been selected by the Fund's Board of Trustees, including a
majority of the Independent Trustees, as the Fund's independent auditors for the
fiscal year ending June 30, 2002. Such selection is submitted to the
shareholders for ratification or rejection.
The Fund paid the following fees to KPMG during the fiscal year ended
June 30, 2001:
Audit Fees: $12,500
Financial Information
Systems Design and Implementation 0
All Other Fees $5,038
(Fees for preparation
of the Fund's tax
returns and review of Forms 1099
for the Fund's shareholders.)
KPMG did not perform any services during the fiscal year for the Fund's
investment adviser (the Manager) or any entity controlling, controlled by or
under common control with the Manager that provides services to the Fund.
The Audit Committee of the Fund's Board of Trustees, which consists of
all of the independent Trustees, has reviewed all services performed and fees
charged by KPMG and has accepted its representation that it is independent in
recommending re-appointment of it for the fiscal year ending June 30, 2002.
KPMG has no direct or indirect financial interest in the Fund or the
Manager. It is expected that representatives of KPMG will not be present at the
meeting but will be available should any matter arise requiring their presence.
Receipt of
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 Fund's proxy statement and proxy card for a
particular annual meeting. One of these conditions relates to the timely receipt
by the Fund of any such proposal. Under these rules, proposals submitted for
inclusion in the proxy material for the Fund's next annual meeting after the
meeting to which this Proxy Statement relates must be received by the Fund not
less than 120 days before the anniversary of the date stated in this Proxy
Statement for the first mailing of this Proxy Statement. The date for such
submission could change, depending on the scheduled date for the next annual
meeting; if so, the Fund will so advise you.
The fact that the Fund receives a shareholder proposal in a timely
manner does not insure its inclusion in the Fund's proxy material, since there
are other requirements in the proxy rules relating to such inclusion.
Other Business
The Fund 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, telephone or internet vote
entitles them to vote, in accordance with their judgment on such matter or
matter, except as noted. That is, by signing and returning your proxy card or by
voting by telephone or the Internet, you give the proxy holders discretionary
authority as to any such matter or matters.
<Page>
Important Notice
Please Read Immediately
Narragansett Insured Tax-Free Income Fund
Notice Of Annual Meeting Of Shareholders
to be held on November 7, 2001
PROXY STATEMENT
<page>
Aquilasm Group of Funds
Narragansett Insured Tax-Free Income Fund-Class A
Proxy for Shareholders Meeting November 7, 2001
Proxy Solicited on Behalf of the Board of Trustees
The undersigned shareholder of Narragansett Insured Tax-Free Income Fund
(the "Fund") does hereby appoint LACY B. HERRMANN, DIANA P. HERRMANN 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
Fund to be held on Wednesday, November 7, 2001, at the Rhode Island Convention
Center, 1 Sabin Street, Providence, Rhode Island; at 2:30 p.m. local 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 below.
Such shares are entitled to one vote for every dollar of net asset value
represented by the share balance printed below.
Please read the proxy statement prior to voting.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please so indicate on the proxy card or
e-mail us at info@aquilafunds.com
VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week
Telephone
1-800-690-6903
To vote your shares by telephone, call toll free 1-800-690-6903. You
will be prompted to enter the 12-digit control number on this proxy card. 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.
Internet
www.proxyvote.com
To vote your shares by the Internet, contact the Fund at
www.proxyvote.com You will be prompted to enter the 12-digit control number on
this proxy card. Follow the simple instructions at the website, using your proxy
card as a guide. If you vote by the Internet, you need not return the proxy card
by mail.
Mail
You can vote your shares by completing and returning this proxy card.
Please mark your proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please indicate it on the proxy card, or
e-mail us at info@aquilafunds.com
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
-----------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
Narragansett Insured Tax-Free Income Fund- Class A
Vote on Trustees
(Proposal No.1 in Proxy Statement)
1. Election of Trustees 01) Lacy B. Herrmann*; 02) Vernon R. Alden; 03) Paul Y.
Clinton; 04) David A. Duffy*; 05) William J. Nightingale; 06) J. William Weeks
*interested Trustees
--
[__] For All
--
[__] Withhold All
--
[__] For All Except
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.
----------------
[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
below or FOR if no choice is indicated.
2. Action on selection of KPMG LLP as independent auditors
(Proposal No. 2 in Proxy Statement)
FOR [__] AGAINST [__] ABSTAIN [__]
As to any other matter said proxies shall vote in accordance with
their best judgment.
Please indicate if you plan to attend the Annual Meeting. If you mark the box
below, you must return the proxy card by mail to have this information recorded.
I plan to attend the annual meeting. [__]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian,
attorney, executor, administrator, trustee, guardian, etc., please sign your
full title as such. Joint owners should each sign.
For address changes and/or comments, please check this box
and write them on the back. [_]
_________________________________Dated: _________
Signature
[Please sign within the box]
_________________________________Dated: __________
Signature
(Joint Owners)
<page>
Aquilasm Group of Funds
Narragansett Insured Tax-Free Income Fund-Class C
Proxy for Shareholders Meeting November 7, 2001
Proxy Solicited on Behalf of the Board of Trustees
The undersigned shareholder of Narragansett Insured Tax-Free Income Fund
(the "Fund") does hereby appoint LACY B. HERRMANN, DIANA P. HERRMANN 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
Fund to be held on Wednesday, November 7, 2001, at the Rhode Island Convention
Center, 1 Sabin Street, Providence, Rhode Island; at 2:30 p.m. local 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 below.
Such shares are entitled to one vote for every dollar of net asset value
represented by the share balance printed below.
Please read the proxy statement prior to voting.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please so indicate on the proxy card or
e-mail us at info@aquilafunds.com
VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week
Telephone
1-800-690-6903
To vote your shares by telephone, call toll free 1-800-690-6903. You
will be prompted to enter the 12-digit control number on this proxy card. 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.
Internet
www.proxyvote.com
To vote your shares by the Internet, contact the Fund at
www.proxyvote.com You will be prompted to enter the 12-digit control number on
this proxy card. Follow the simple instructions at the website, using your proxy
card as a guide. If you vote by the Internet, you need not return the proxy card
by mail.
Mail
You can vote your shares by completing and returning this proxy card.
Please mark your proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please indicate it on the proxy card, or
e-mail us at info@aquilafunds.com
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
-----------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
Narragansett Insured Tax-Free Income Fund- Class C
Vote on Trustees
(Proposal No.1 in Proxy Statement)
1. Election of Trustees 01) Lacy B. Herrmann*; 02) Vernon R. Alden; 03) Paul Y.
Clinton; 04) David A. Duffy*; 05) William J. Nightingale; 06) J. William Weeks
*interested Trustees
--
[__] For All
--
[__] Withhold All
--
[__] For All Except
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.
----------------
[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
below or FOR if no choice is indicated.
2. Action on selection of KPMG LLP as independent auditors
(Proposal No. 2 in Proxy Statement)
FOR [__] AGAINST [__] ABSTAIN [__]
As to any other matter said proxies shall vote in accordance with
their best judgment.
Please indicate if you plan to attend the Annual Meeting. If you mark the box
below, you must return the proxy card by mail to have this information recorded.
I plan to attend the annual meeting. [__]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian,
attorney, executor, administrator, trustee, guardian, etc., please sign your
full title as such. Joint owners should each sign.
For address changes and/or comments, please check this box
and write them on the back. [_]
_________________________________Dated: _________
Signature
[Please sign within the box]
_________________________________Dated: __________
Signature
(Joint Owners)
<page>
Aquilasm Group of Funds
Narragansett Insured Tax-Free Income Fund-Class Y
Proxy for Shareholders Meeting November 7, 2001
Proxy Solicited on Behalf of the Board of Trustees
The undersigned shareholder of Narragansett Insured Tax-Free Income Fund
(the "Fund") does hereby appoint LACY B. HERRMANN, DIANA P. HERRMANN 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
Fund to be held on Wednesday, November 7, 2001, at the Rhode Island Convention
Center, 1 Sabin Street, Providence, Rhode Island; at 2:30 p.m. local 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 below.
Such shares are entitled to one vote for every dollar of net asset value
represented by the share balance printed below.
Please read the proxy statement prior to voting.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please so indicate on the proxy card or
e-mail us at info@aquilafunds.com
VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week
Telephone
1-800-690-6903
To vote your shares by telephone, call toll free 1-800-690-6903. You
will be prompted to enter the 12-digit control number on this proxy card. 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.
Internet
www.proxyvote.com
To vote your shares by the Internet, contact the Fund at
www.proxyvote.com You will be prompted to enter the 12-digit control number on
this proxy card. Follow the simple instructions at the website, using your proxy
card as a guide. If you vote by the Internet, you need not return the proxy card
by mail.
Mail
You can vote your shares by completing and returning this proxy card.
Please mark your proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please indicate it on the proxy card, or
e-mail us at info@aquilafunds.com
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
-----------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
Narragansett Insured Tax-Free Income Fund- Class Y
Vote on Trustees
(Proposal No.1 in Proxy Statement)
1. Election of Trustees 01) Lacy B. Herrmann*; 02) Vernon R. Alden; 03) Paul Y.
Clinton; 04) David A. Duffy*; 05) William J. Nightingale; 06) J. William Weeks
*interested Trustees
--
[__] For All
--
[__] Withhold All
--
[__] For All Except
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.
----------------
[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
below or FOR if no choice is indicated.
2. Action on selection of KPMG LLP as independent auditors
(Proposal No. 2 in Proxy Statement)
FOR [__] AGAINST [__] ABSTAIN [__]
As to any other matter said proxies shall vote in accordance with
their best judgment.
Please indicate if you plan to attend the Annual Meeting. If you mark the box
below, you must return the proxy card by mail to have this information recorded.
I plan to attend the annual meeting. [__]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian,
attorney, executor, administrator, trustee, guardian, etc., please sign your
full title as such. Joint owners should each sign.
For address changes and/or comments, please check this box
and write them on the back. [_]
_________________________________Dated: _________
Signature
[Please sign within the box]
_________________________________Dated: __________
Signature
(Joint Owners)
<page>
Aquilasm Group of Funds
Narragansett Insured Tax-Free Income Fund-Class I
Proxy for Shareholders Meeting November 7, 2001
Proxy Solicited on Behalf of the Board of Trustees
The undersigned shareholder of Narragansett Insured Tax-Free Income Fund
(the "Fund") does hereby appoint LACY B. HERRMANN, DIANA P. HERRMANN 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
Fund to be held on Wednesday, November 7, 2001, at the Rhode Island Convention
Center, 1 Sabin Street, Providence, Rhode Island; at 2:30 p.m. local 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 below.
Such shares are entitled to one vote for every dollar of net asset value
represented by the share balance printed below.
Please read the proxy statement prior to voting.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please so indicate on the proxy card or
e-mail us at info@aquilafunds.com
VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week
Telephone
1-800-690-6903
To vote your shares by telephone, call toll free 1-800-690-6903. You
will be prompted to enter the 12-digit control number on this proxy card. 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.
Internet
www.proxyvote.com
To vote your shares by the Internet, contact the Fund at
www.proxyvote.com You will be prompted to enter the 12-digit control number on
this proxy card. Follow the simple instructions at the website, using your proxy
card as a guide. If you vote by the Internet, you need not return the proxy card
by mail.
Mail
You can vote your shares by completing and returning this proxy card.
Please mark your proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.
Annual Meeting Attendance We encourage you to attend the Annual Meeting of
Shareholders. If you can join us, please indicate it on the proxy card, or
e-mail us at info@aquilafunds.com
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
-----------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
Narragansett Insured Tax-Free Income Fund- Class I
Vote on Trustees
(Proposal No.1 in Proxy Statement)
1. Election of Trustees 01) Lacy B. Herrmann*; 02) Vernon R. Alden; 03) Paul Y.
Clinton; 04) David A. Duffy*; 05) William J. Nightingale; 06) J. William Weeks
*interested Trustees
--
[__] For All
--
[__] Withhold All
--
[__] For All Except
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.
----------------
[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
below or FOR if no choice is indicated.
2. Action on selection of KPMG LLP as independent auditors
(Proposal No. 2 in Proxy Statement)
FOR [__] AGAINST [__] ABSTAIN [__]
As to any other matter said proxies shall vote in accordance with
their best judgment.
Please indicate if you plan to attend the Annual Meeting. If you mark the box
below, you must return the proxy card by mail to have this information recorded.
I plan to attend the annual meeting. [__]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian,
attorney, executor, administrator, trustee, guardian, etc., please sign your
full title as such. Joint owners should each sign.
For address changes and/or comments, please check this box
and write them on the back. [_]
_________________________________Dated: _________
Signature
[Please sign within the box]
_________________________________Dated: __________
Signature
(Joint Owners)