SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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 toss.240.14a-12
LCM Internet Growth Fund, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / 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: Common
Stock, par value $.001 per share
(2) Aggregate number of securities to which transaction applies:
(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 fee is
calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / 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.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
LCM INTERNET GROWTH FUND, INC.
223 W. Lake Street
Chicago, Illinois 60606
312.705.3028
--------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
June 28, 2001
TO OUR SHAREHOLDERS:
The second Annual Meeting of Shareholders of LCM Internet Growth Fund, Inc. will
be held at the Fund's offices located at 223 W. Lake St., Chicago, Illinois
60606, on Thursday, June 28, 2001 at 10:00 a.m. Central Time for the following
purposes:
(1) To elect six directors to serve until the 2002 Annual Meeting of
Shareholders and until their successors are duly elected and qualified;
(2) To ratify the appointment of PricewaterhouseCoopers LLP as our independent
auditors for fiscal 2001; and
(3) To transact such other business as may properly come before the Annual
Meeting (and any adjournment of the meeting), all in accordance with the
accompanying Proxy Statement.
Shareholders of Record at the close of business on May 25, 2001 are entitled to
receive notice of and to vote at the Annual Meeting or any adjournments.
All shareholders are cordially invited to attend the Annual Meeting in person.
However, whether or not you expect to attend the Annual Meeting in person, you
are urged to complete, date and sign the enclosed proxy card and return it as
soon as possible in the enclosed envelope which has been provided for your
convenience and which requires no postage if mailed in the United States. The
prompt return of proxy cards will ensure a quorum. If you send in your proxy
card and then decide to attend the Annual Meeting to vote your shares in person,
you may still do so. You may revoke your proxy by following the procedures
described in the Proxy Statement.
By Order of the Board of Directors,
Barry J. Glasgow, Secretary
June 4, 2001
LCM INTERNET GROWTH FUND, INC.
223 W. Lake Street
Chicago, Illinois 60606
312.705.3028
Proxy Statement
Unless the context requires otherwise, all references to "LCM," "we" or "our"
refers to LCM Internet Growth Fund, Inc. Our fiscal year ends on March 31. In
this proxy statement, we refer to fiscal years by reference to the calendar year
in which they end (e.g., the fiscal year ended March 31, 2001 is referred to as
"fiscal 2001").
This Proxy Statement is furnished by the Board of Directors of LCM for the
solicitation of proxies from the holders of our common stock, $0.01 par value
(the "Common Stock"), to be voted at the Annual Meeting of Shareholders to be
held at the offices of LCM at 223 W. Lake St., Chicago, Illinois 60606, on
Thursday, June 28, 2001 at 10:00 a.m., Central Time, and at any adjournment
thereof (the "Annual Meeting"). It is expected that the Notice of Annual Meeting
of Shareholders, this Proxy Statement and the enclosed proxy card, together with
the Annual Report to Shareholders for fiscal 2001, will be mailed to
shareholders commencing on or about June 6, 2001.
At the Annual Meeting, our shareholders will elect six directors, each of who
will hold office until the 2002 Annual Meeting and until his successor is duly
elected and qualified. Our shareholders will also vote on whether to ratify
PricewaterhouseCoopers LLP as our independent auditors for fiscal 2002.
Shareholders can ensure that their shares are voted at the Annual Meeting by
signing and returning the enclosed proxy card in the envelope provided. The
submission of a signed proxy will not affect a shareholder's right to attend the
Annual Meeting and vote in person. Shareholders who execute proxies retain the
right to revoke them at any time before they are voted by filing with our
Secretary a written revocation or a proxy bearing a later date. The presence at
the Annual Meeting of a shareholder who has signed a proxy does not itself
revoke that proxy unless the shareholder attending the Annual Meeting files a
written notice of revocation of the proxy with our Secretary at any time prior
to the voting of the proxy.
Proxies will be voted as specified by the shareholders. Where specific choices
are not indicated, proxies will be voted FOR the election of each of the
individuals nominated to serve as directors and FOR ratification of the
appointment of our independent auditors. The Board of Directors knows of no
other matters to be presented for shareholder action at the Annual Meeting. If
any matters properly come before the Annual Meeting, the persons named as
proxies will vote on them in accordance with their best judgment.
The expense of printing and mailing proxy materials, including expenses involved
in forwarding materials to beneficial owners of Common Stock held in the name of
another person, will be paid by us. No solicitation other than by mail is
contemplated, except that officers and representatives of LCM and officers and
employees of our investment adviser, LCM Capital Management, Inc. (the
"Adviser"), may solicit the return of proxies from certain shareholders by
telephone.
Only shareholders of record at the close of business on May 25, 2001 (the
"Record Date") are entitled to receive notice of and to vote the shares of
Common Stock registered in their name at the Annual Meeting. As of the Record
Date, we had outstanding 2,578,883 shares of Common Stock. Each share of Common
Stock entitles its holder to cast one vote on each matter to be voted upon at
the Annual Meeting.
The presence of a quorum is required to transact business at the Annual Meeting.
A quorum is defined as the presence, either in person or by proxy, of the
holders of shares entitled to cast one-third of the votes entitled to be cast at
the Annual Meeting. The shares represented at the Annual Meeting by proxies that
are marked "withhold authority" for the election of directors or "abstain" for
the ratification of our auditors will be counted as shares present for the
purpose of determining whether a quorum is present. Broker non-votes will also
be counted as shares present for purposes of determining a quorum. If a quorum
is not present, the Secretary may adjourn the meeting to permit further
solicitation of proxies.
Directors are elected by a plurality of the votes cast by holders of our Common
Stock entitled to vote at a meeting at which a quorum is present. In other
words, nominees receiving the largest number of affirmative votes cast will be
elected as directors. Accordingly, any shares not voted affirmatively, whether
by abstention, broker non-vote or otherwise will not be counted as affirmative
votes cast for any director.
The appointment of our independent auditors must be ratified by a majority of
the votes entitled to be cast by holders of our Common Stock at a meeting at
which a quorum is present. Abstentions and broker non-votes will have the same
effect as a vote against the appointment of our independent auditors.
SHARE OWNERSHIP
The following table sets forth information regarding the beneficial ownership of
LCM's outstanding shares as of the Record Date by (i) each director and
executive officer and (ii) all directors and executive officers as a group. As
of the Record Date, we do not believe that any person is the beneficial owner of
more than 5% of LCM's outstanding shares.
Percent of
Name and Address (1) Number of Shares Outstanding Shares
- -------------------- ---------------- ------------------
Michael R. Grady, Jr. 9,617.70 (2) *
Barry J. Glasgow 0 *
David von Vistauxx 7,094.60 *
Michael Radnor 2,547.30 *
George D. Kraft 1,047.30 *
Lawrence E. Harb 0 *
All directors and executive officers as a group 20,306.90 *
(6 persons)
* Less than 1% of the outstanding shares
(1) The address of Messrs. Grady and Glasgow is 223 W. Lake Street, Chicago,
Illinois 60606. The address of Dr. von Vistauxx is 223 University Boulevard
East, Silver Spring, Maryland 20901. The address of Dr. Radnor is
Northwestern University, 2001 Sheridan Road, Evanston, Illinois 60208. The
address of Dr. Kraft is I.I.T. Stuart School of Business, 565 West Adams
Street, Chicago, Illinois 60631. The address of Mr. Harb is 3520 Okemos
Road, Suite 120, Okemos, Michigan 48864.
(2) 7,837.29 shares are held in spouse's name and remaining 1,780.41 shares are
held in an Individual Retirement Account for the benefit of Mr. Grady.
Proposal One: ELECTION OF DIRECTORS
The Board of Directors proposes that the nominees described below, who are
currently serving as directors, be elected as directors, each of whom will hold
office until the 2002 Annual Meeting and until his successor is duly elected and
qualified. Each director who is deemed an "interested person" of LCM, as defined
in the Investment Company Act of 1940 (the "1940 Act"), is indicated by an
asterisk. The directors and officers listed below have served since inception of
LCM in August 1998, except as otherwise noted.
The nominees have indicated a willingness to serve as directors, but if any of
them should decline or be unable to act as a director, the persons named in the
proxy will vote for the election of another person or persons as the Board of
Directors recommends.
Nominees for Director
Present Position with LCM
Name and Age and Business Experience
*Michael R. Grady, Jr. President, Treasurer and Director of LCM
Age 38 Mr. Grady co-founded the Adviser with Mr. Glasgow in
June 1998 and has served as its President and a
Director since then. Since January 1997, Mr. Grady
has also served as President of LaSalle St. Capital
Markets, Inc., an investment banking, research and
consulting firm, which is an affiliate of the Adviser.
Since December 1996, Mr. Grady has also been a
registered representative of LaSalle St. Securities,
LLC, a registered broker-dealer, an affiliate of the
Adviser and the principal underwriter for LCM's initial
public offering in October 1999 (the "Underwriter").
Prior to joining the LaSalle group of companies,
both of which are located in Chicago, Illinois,
Mr. Grady spent 18 months with Madison Securities,
Inc., a registered broker-dealer in Chicago, Illinois
(from June 1995 until December 1996), and 14 months
with Lexington Securities, Inc., a registered
broker-dealer in Chicago, Illinois (from April 1994
until June 1995). At both companies, he was a
registered representative and Executive Vice
President. Mr. Grady received his B.S. in Finance
from Northern Illinois University in 1985.
*Barry J. Glasgow
Age 58 Vice President, Secretary and Director of LCM
Mr. Glasgow co-founded the Adviser with Mr. Grady in
June 1998 and has served as its Chief Investment
Officer, Secretary, Portfolio Manager and a Director
since then. From May 1991 until June 1998, Mr. Glasgow
served as the Managing Partner and Portfolio Manager
of Gonski & Glasgow Investments, a registered
investment adviser in Elgin, Illinois. From January
1991 until May 1996, Mr. Glasgow served as a registered
representative of Rocky Mountain Securities, Inc., a
registered broker-dealer, in its Elgin, Illinois
branch office. From May 1996 until May 1998, Mr.
Glasgow served as a registered representative of
Berry-Shino Securities, Inc., a registered office.
broker-dealer, in its Elgin, Illinois branch
Since May 1998, Mr. Glasgow has served as a registered
representative of the Underwriter, and from November
1998 until October 1999, Mr. Glasgow was employed as
a Research Analyst at LaSalle St. Capital Markets, Inc.
David von Vistauxx, Ph.D.
Age 51 Director of LCM
Dr. von Vistauxx has served as the President and a
Director of American Communication & Computation, Inc.,
a corporation engaged in the communications
infrastructure business, since January 1980, and as a
Director of International Digital Maintenance, Ltd., a
digital equipment repair firm, since May 1972. Both
companies are located in Silver Springs, Maryland. Dr.
von Vistauxx holds several patents in the fields of
electronic and security devices. As a pioneer in modern
computing, Dr. von Vistauxx developed several early
computer technologies. In the 1970s, he developed the
downlink and computation algorithms for NASA's ABS
satellites, the domestic money transfer system for
Bankers Trust in New York, the off-track betting system
for the State of New York and an encrypted
telecommunications system for the U.S. government.
Dr. von Vistauxx received his B.S. in Physics from the
Massachusetts Institute of Technology (M.I.T.), his
M.S.C.S. from the University of Maryland and a
Doctorate in Economics from Harvard University. Dr. von
Vistauxx is listed in "Who's Who" in the computer
industry.
Michael Radnor, Ph.D.
Age 68 Director of LCM
Dr. Radnor has served as a Professor at the J.L. Kellogg
Graduate School of Management at Northwestern University
in Evanston, Illinois since 1964. In 1983, Dr. Radnor
launched the International Business Development program
through which his staff at Northwestern assisted
numerous U.S. and foreign companies to strengthen their
international operations, technology and trade
strategies and programs. Dr. Radnor is the President of
IBD, Inc. In 1989, Dr. Radnor, with support from the
State of Illinois, established the International
Business Development (IBD) Program to provide
counseling, training, referral services and direct
assistance to small businesses in the Midwest.
Privatized as IBD, Inc. in late 1994, the program works
with firms in several countries worldwide. Dr. Radnor is
also the Chairman of a large consortium of major
firms focused on technology management.
George D. Kraft, Ph.D.
Age 63 Director of LCM
Dr. Kraft has served as a Professor at the I.I.T. Stuart
School of Business in Chicago, Illinois since 1994.
Previously, he was an Associate Professor of Electrical
and Computer Engineering in the Armour College of
Engineering at I.I.T. In 1993, Dr. Kraft helped form the
Telecommuting Advisory Council of Illinois, and in 1991
he was a member of a statewide telecommunications
committee that developed a strategic plan for wiring
Illinois with a broadband multimedia network. He has
consulted extensively for the U.S. government through
work for the Defense Information Systems Agency, the
Department of Housing and Urban Development and the
General Services Administration. Each of these agencies
has used him as a national expert on telecommunication
capabilities and products. Dr. Kraft has also been
involved with the National Institute of Standards and
Technology, as manager of the Integrated Services
Digital Network ("ISDN") Standardization Effort and the
Alternate Chairman of the Executive Steering Committee
of the North American ISDN User's Forum. Dr. Kraft has
served as a Director of LCM since March 1999.
Lawrence E. Harb Director of LCM
Age 48 Mr. Harb is the President and CEO of IT Risk Managers,
Inc., a company that specializes in providing Internet
and Technology training, development, wholesaling and
risk management services to the insurance industry.
Prior to starting IT Risk Managers, Mr. Harb was an
Executive Vice President with J.S. Wurzler Underwriting
Managers. He and his two partners created one of the
first Internet insurance programs underwritten by
Lloyd's of London that protected web sites from hackers,
viruses, and other virtual perils. Mr. Harb launched his
insurance career with Aon Corporation as Chairman and
CEO of Financial Solutions Insurance Services, a company
comprised of six Aon subsidiaries, each specializing in
insuring financial institutions. During his tenure with
Aon, Mr. Harb also started Aon Securities Corp., a
registered broker dealer, and the Aon Funds, a
proprietary family of six mutual funds. Before joining
Aon, Mr. Harb was President and founder of LaSalle
Consultants, Ltd. and President of LCL Investments, Inc.
Mr. Harb also served as an adjunct professor in the
Illinois Institute of Technology's Financial Markets and
Trading Program, from 1993-96. Mr. Harb holds a Master
of Management degree from Northwestern University's
Kellogg School of Management and a B.S. in Management
from Northern Illinois University. Mr. Harb has served
as a Director of LCM since March 1999.
The Board of Directors has a standing Audit Committee. The Board of Directors
does not have a Nominating Committee or a Compensation Committee. The Board of
Directors held four meetings in fiscal 2001. Each director attended 100% of the
meetings of the Board of Directors held in fiscal 2001.
The Audit Committee presently consists of Messrs. von Vistauxx, Radnor, Kraft
and Harb, each of who is independent as defined in Section 121(A) of the listing
standards of the American Stock Exchange. The Audit Committee's primary duties
and responsibilities are to: (i) monitor the integrity of our financial
reporting process and systems of internal controls regarding finance, accounting
and legal compliance; (ii) monitor the independence and performance of our
independent public accountants and monitor the overall performance of our fund
accounting agent; and (iii) provide an avenue of communication among the
independent public accountants, management, the fund accounting agent and the
Board of Directors. The Audit Committee met one time in fiscal 2001.
Audit Committee Report
In accordance with its written charter adopted by the Board of Directors, a copy
of which is attached to this Proxy Statement as Appendix A, the Audit Committee
assists the Board of Directors in fulfilling its responsibility for oversight of
the quality and integrity of our financial reporting practices.
In discharging its oversight responsibility as to the audit process, the Audit
Committee discussed with the independent auditors their independence from LCM
and its management. In addition, the independent auditors provided the Audit
Committee with written disclosure respecting their independence and the letter
required by Independence Standards Board Standard No. 1 ("Independence
Discussions with Audit Committees").
The Audit Committee discussed and reviewed with the independent auditors all
communications required by generally accepted auditing standards, including
those described in Statement on Auditing Standards No. 61 ("Communication with
Audit Committees") and, with and without management present, discussed and
reviewed the results of the independent auditors' examination of LCM's financial
statements. The Audit Committee reviewed the audited financial statements of LCM
for the fiscal year ended March 31, 2001 with management and the independent
auditors. Management has the responsibility for the preparation of LCM's
financial statements and the independent auditors have the responsibility for
the examination of those statements.
Based upon the above-mentioned review and discussions with management and the
independent auditors, the Audit Committee recommended to the Board of Directors
that LCM's audited financial statements be included in its Annual Report for the
fiscal year ended March 31, 2001 for filing with the Securities and Exchange
Commission.
This report shall not be deemed incorporated by reference by any general
statement incorporating by reference this Proxy Statement into any filing under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, and shall not otherwise be deemed filed under such Acts.
The Audit Committee of the Board of Directors
David von Vistauxx
Michael Radnor
George D. Kraft
Lawrence E. Harb
Director Compensation
Directors and officers of LCM who are also officers, directors or employees of
the Adviser do not receive any remuneration from LCM for serving as directors or
officers of LCM. Accordingly, neither Mr. Grady nor Mr. Glasgow receives any
remuneration from LCM for their services as directors and officers of LCM.
However, the remaining directors received the following fees for their services
as directors of LCM during fiscal 2001.
Pension or
Aggregate Retirement Total
Name Compensation (1) Benefits Compensation
---- ---------------- ----------------- ------------
David von Vistauxx $8,000 $0 $8,000
Michael Radnor $8,000 $0 $8,000
George D. Kraft $8,000 $0 $8,000
Lawrence E. Harb $8,000 $0 $8,000
(1) For fiscal 2002 each director who is not deemed an "interested person" of
LCM, as defined in the 1940 Act, will receive a retainer fee of $6,000. In
addition, each disinterested director will receive a fee of $500 for each Board
of Directors meeting attended by such person, plus reimbursement of reasonable
expenses incurred in connection therewith. The Board anticipates holding four
meetings during fiscal 2001. Thus, each disinterested director is entitled to
$8,000 during fiscal 2001 from LCM, plus reasonable expenses.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors and
officers, among others, to file reports with the Securities and Exchange
Commission disclosing their ownership, and changes in their ownership, of stock
in LCM. Copies of these reports must also be furnished to LCM. Based solely on a
review of these copies, we believe that during fiscal 2001, all filing
requirements were met.
Proposal Two: RATIFICATION OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders at the Annual Meeting, the Board of
Directors has appointed PricewaterhouseCoopers LLP, an independent public
accounting firm, to audit the financial statements of LCM for the fiscal year
ending March 31, 2002. Representatives of PricewaterhouseCoopers LLP may be
present at the Annual Meeting (either in person or by telephone) to make any
statement they may desire and to respond to questions from shareholders.
If the shareholders do not ratify the appointment of PricewaterhouseCoopers LLP,
the selection of our independent auditors will be reconsidered by the Audit
Committee and the Board of Directors.
In connection with the fiscal year ended March 31, 2001, PricewaterhouseCoopers
LLP provided various audit and non-audit services to LCM and billed LCM for
these services as follows:
a) Audit Fees. Aggregate fees billed to LCM by PricewaterhouseCoopers LLP for
professional services rendered for the audit of LCM's financial statements
for the fiscal year ended March 31, 2001 totaled $7,092.00.
b) Financial Information Systems Design and Implementation Fees.
PricewaterhouseCoopers LLP did not render any services respecting financial
information systems design and implementation during the fiscal year ended
March 31, 2001 to LCM, the Adviser, or any entity controlling, controlled
by, or under common control with the Adviser that provides services to LCM.
c) All Other Fees. Aggregate fees billed to LCM by PricewaterhouseCoopers
LLP for non-audit services rendered for the fiscal year ended March
31, 2001 to LCM, the Adviser, or any entity controlling, controlled
by, or under common control with the Adviser that provides services to
LCM, including tax related services, totaled $8,020.00.
The Board of Directors has considered whether the provision of the non-audit
services related to sections (b) and (c) above is compatible with maintaining
the independence of PricewaterhouseCoopers LLP and has determined that such
services have not adversely affected the independence of PricewaterhouseCoopers
LLP.
Proposal Three: OTHER MATTERS
Although management is not aware of any other matters that may come before the
2001 Annual Meeting, if any such matters should be presented, the persons named
in the accompanying proxy intend to vote such proxy in accordance with their
best judgment.
FUND INFORMATION
The investment adviser for LCM is LCM Capital Management, Inc., 223 West Lake
Street, Chicago, Illinois 60606.
The principal underwriter for LCM's initial public offering in October 1999 was
LaSalle St. Securities, LLC, 223 West Lake Street, Chicago, Illinois 60606. LCM
may occasionally engage LaSalle St. Securities, LLC to execute portfolio
securities transactions.
The administrator for LCM is Firstar Mutual Fund Services, LLC, 615 East
Michigan Street, Milwaukee, Wisconsin 53202.
SUBMISSION OF SHAREHOLDER PROPOSALS
We must receive any proposal that a shareholder intends to present at and have
included in our Proxy Statement for the 2002 Annual Meeting by the close of
business on January 31, 2002. If a shareholder intends to present a proposal at
the 2002 Annual Meeting, but does not seek inclusion of that proposal in our
Proxy Statement for that meeting, the proxy holders for that meeting will be
entitled to exercise discretionary authority on that proposal if we have not
received notice of the proposal by April 15, 2002. If notice of any such
proposal is timely received, the proxy holders may exercise discretionary
authority with respect to such proposal but only to the extent permitted by the
regulations of the Securities and Exchange Commission.
By Order of the Board of Directors,
Barry J. Glasgow, Secretary
Proxy Card
LCM INTERNET GROWTH FUND, INC.
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned appoint(s) Michael R. Grady, Jr. and Barry J. Glasgow, and each
of them, as proxies, each with the power to appoint his substitute, and
authorizes each of them to represent and to vote, as designated on the reverse
side, all of the shares of stock of LCM Internet Growth Fund, Inc. held as of
record by the undersigned as of May 25, 2001at the 2001 Annual Meeting of
Shareholders of LCM Internet Growth Fund, Inc. to be held on June 28, 2001 or at
any adjournment thereof.
This proxy when properly executed will be voted in the manner directed herein by
the undersigned shareholder. If no direction is made, this proxy will be voted
FOR the election of the nominees as directors and FOR the ratification of
PricewaterhouseCoopers LLP as independent auditors.
PLEASE COMPLETE, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE
ENVELOPE PROVIDED
1. ELECTION OF DIRECTORS:
(To serve until the 2002 Annual Meeting and until their successors are elected
and qualified)
1 - Barry J. Glasgow
2 - Michael R. Grady, Jr.
3 - Lawrence E. Harb
4 - George D. Kraft
5 - Michael Radnor
6 - David von Vistauxx
__ FOR all nominees listed to the left (except as specified below).
__ WITHHOLD AUTHORITY to vote for all nominees listed to the left.
Instructions: To withhold authority to vote for any indicated nominee, write the
number(s) of the nominee(s) in the box provided to the right.
2. RATIFICATION OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT AUDITORS FOR THE
FISCAL YEAR ENDING MARCH 31, 2002.
__ FOR
__ AGAINST
__ ABSTAIN
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
Number of shares: ________________
Check appropriate box. Indicate changes below: __ Address change? __ Name
change?
Date: ___________________
- -----------------------------------
(Signature of Shareholder)
- -----------------------------------
(Signature of Shareholder - if held jointly)
Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Appendix A
LCM I NTERNET GROWTH FUND, INC.
AUDIT COMMITTEE CHARTER
I. Purpose
The Audit Committee is appointed by the Board of Directors to assist the Board
in fulfilling its oversight responsibilities. The Audit Committee's primary
duties and responsibilities are to:
o Monitor the integrity of the Company's financial reporting process and
systems of internal controls regarding finance, accounting and legal
compliance.
o Monitor the independence and performance of the Company's independent
public accountants and monitor the overall performance of the Company's
fund accounting agent.
o Provide an avenue of communication among the independent public
accountants, management, the fund accounting agent and the Board of
Directors.
The Audit Committee has the authority to conduct any investigation appropriate
to fulfilling its responsibilities, and it has direct access to the independent
public accountants as well as any service provider to the Company (or any
employee thereof). The Audit Committee has the ability to retain, at the
Company's expense, special legal, accounting, or other consultants or experts it
deems necessary in the performance of its duties.
II. Committee Composition
The Committee shall be comprised of at least three members, consisting solely of
directors of the Company who are not "interested persons" as defined in the
Investment Company Act of 1940, as amended, of the Company.
By June 14, 2001, the Committee shall be comprised of at least three members,
consisting solely of "independent" directors who are "financially literate" or
become "financially literate" within a reasonable period of time after his or
her appointment to the Committee. Committee members may enhance their
familiarity with finance and accounting by participating in educational
programs.
A director is "independent" and "financially literate" if he or she meets the
requirements set forth in the rules of the American Stock Exchange. The current
requirements for independence and financial literacy are attached hereto as
Appendix A, which may be supplemented from time to time as such requirements are
modified. One director who is not independent and who is not a current employee
or an immediate family member of a current executive officer may serve on the
Committee, provided that the Board determines that such director's membership on
the Committee is required by the best interests of the Company and its
shareholders.
By June 14, 2001, at least one member of the Committee shall also have
accounting or related financial management experience in accordance with the
requirements of the American Stock Exchange.
III. Meeting and Reports
The Committee shall meet as frequently as the Committee deems necessary, but at
least annually. The Committee shall report periodically to the Board of
Directors regarding the Committee's activities, findings and recommendations.
Meetings of the Committee may be called by the Chairperson of the Committee or
otherwise as provide in the By-Laws of the Company. The Committee may conduct
its business and affairs at any time or location it deems appropriate.
Attendance and participation in a meeting may take place by telephone conference
or similar communications equipment by means of which all persons participating
in the meeting can hear each other. Any action of the Committee may be made by
written consent. All decisions of the Committee shall be determined by the
affirmative vote of a majority of its members.
The members of the Committee shall be elected by the Board to hold such office
until their successors shall be duly elected and qualified. Unless a Chairperson
is elected by the Board, the members of the Committee may designate a
Chairperson by majority vote of the full committee membership.
IV. Responsibilities and Powers
The Committee shall be responsible for the following:
o Review and assess the adequacy of this Charter on at least an annual basis.
o Review and assess on an annual basis whether the Committee has satisfied
its responsibilities during the prior year in compliance with this Charter.
o Monitor and evaluate the performance, independence and qualifications of
the independent public accountants and review the scope, services and fees
charged for their audit.
o Recommend to the Board of Directors the appointment of the independent
public accountants or approve any proposed discharge of the independent
public accountants when circumstances warrant (or nominate the independent
public accountants to be proposed for shareholder approval in any proxy
statement of the Company).
o Review and discuss with the independent public accountants the independent
public accountants' ultimate accountability to the Board of Directors and
the Audit Committee.
o Ensure the independence of the Company's independent public accountants.
The Committee shall obtain a formal written statement listing all
relationships between the independent public accountants and the Company
from the independent public accounts on an annual basis. The Committee will
also review and discuss with the independent public accountants any
disclosed relationships or services that may impact the objectivity and
independence of the independent public accountants and recommend that the
Board of Directors take appropriate action to ensure the independent public
accountants' independence.
o Review with management any problems that the independent public accountants
raise as a result of their audit of the Company's financial statements.
o Review, evaluate, and periodically meet with the company's fund accounting
agent to assess the scope, services and fees provided for such services and
any issues or problems raised.
o Review and discuss with management and privately discuss with the
independent public accountants on an annual basis the Company's audited
financial statements to be included in the Company's Annual Report and all
major accounting and disclosure policies involved in the preparation of
such report. Make a recommendation to the Board of Directors regarding
inclusion of the audited financial statements in the Company's Annual
Report.
o When required under the SEC's rules, provide an Audit Committee Report to
be included in the Company's annual proxy statement, which states whether
the Committee has: (a) reviewed and discussed with management the Company's
audited financial statements; (b) discussed with the independent public
accountants the matters required to be discussed by Statement on Accounting
Standards No. 61; (c) received the written disclosures and the letter from
the independent public accountants required by Independence Standards Board
Standard No. 1 and discussed with the independent public accountants the
independent public accountants' independence; and (d) based on the review
and discussion of the audited financial statements with management and
discussions with the independent public accountants, the Committee
recommended to the Board of Directors that the audited financial statements
be included in the Company's Annual Report for the last fiscal year for
filing with the SEC.
o Periodically review with management, the fund accounting agent and the
independent public accountants the Company's unaudited financial statements
included in the Company's Semi-Annual Reports and quarterly reports and all
major accounting and disclosure policies involved in the preparation of
such reports.
o Review any significant disagreements between management, the fund
accounting agent and the independent public accountants in connection with
the preparation of the Company's financial statements.
o Direct and supervise an investigation into any matter the Committee deems
necessary and appropriate, including the authority to retain outside
counsel or other professional services.
o Take action in connection with other powers and responsibilities as
determined by the Board of Directors from time to time.
Definitions
AMEX Definition of "Independent" Directors
The following directors would not be considered independent:
(a) a director who is currently an employee of the Company or any of its
affiliates or who was an employee of the Company or any of its affiliates
during the past three years;
(b) a director who accepted any compensation from the Company or any of its
affiliates in excess of $60,000 during the previous fiscal year, other than
compensation for Board service, benefits under a tax-qualified retirement
plan or non-discretionary compensation;
(c) a director who is an immediate family member of an individual who is or has
been during the past three years an executive officer of the Company or any
of its affiliates;
(d) a director who is a partner in, or a controlling shareholder or an
executive officer of, any for-business organization to which the Company
made, or from which the Company received, payments (other than those
arising from investments in the Company's securities) that exceeded 5% of
the Company's or business organization's consolidated gross revenues for
that year, or $200,000, whichever is more, in any of the past three years;
and
(e) a director who is employed as an executive of another entity where any of
the Company's executives serves on that entity's compensation committee.
AMEX Definition of "Financially Literate"
A financially literate director is one who is able to read and understand
fundamental financial statements, including a company's balance sheet, income
statement and cash flow statement.
AMEX Definition of Accounting/Financial Expertise
A director has accounting or related financial management expertise if he or she
has past employment experience in finance or accounting, requisite professional
certification in accounting, or any other comparable experience or background
which results in the director's financial sophistication, including being or
having been a chief executive officer, chief financial officer or other senior
officer with financial oversight responsibilities.