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 Section 240.14a-11(c) or Section
240.14a-12
TRANSAMERICA INCOME SHARES, 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
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:
------------------------------------------------------------------------
TRANSAMERICA INCOME SHARES, INC.
550 North Brand Blvd., Suite 1850,
Glendale, California 91203
PROXY STATEMENT AND
NOTICE OF ANNUAL MEETING
To the shareholders:
The annual meeting of shareholders will be held in the offices of Transamerica
Investment Services, Inc., 1150 South Olive Street, 27th floor, Los Angeles,
California at 9:00 a.m. on Wednesday, July 26, 1995, to vote on:
(1) Election of a board of five directors;
(2) To approve or disapprove continuation of the Management and Investment
Advisory Agreement (the "Agreement");
(3) Ratification of Ernst & Young LLP as independent auditors.
Your shares will be voted as you instruct. If your card is not marked, your
shares will be voted for election of the director nominees and in favor of each
unmarked item. You may revoke your vote before the meeting by written notice to
Transamerica Income Shares (the "Company") or by voting in person at the
meeting. If other business arises, the persons named as proxies are authorized
to vote for you.
Shareholders of record on May 31, 1995, are entitled to one vote for each
share owned. This proxy is solicited by the Board of Directors, and the cost is
paid by the Company. Fiduciaries will be requested to forward proxy materials to
their principals, and they will be reimbursed for out-of-pocket expenses. This
statement will be mailed on or about June 7, 1995. The Company's most recent
annual report for the fiscal year ended March 31, 1995, has been previously
mailed to shareholders. It is available without charge from the transfer agent,
Chemical Mellon Shareholder Services, 111 Founders Plaza, Suite 1100, East
Hartford, CT 06108, telephone toll free: 1-800-288-9541.
HELP YOUR COMPANY SAVE THE COST OF FOLLOW-UP LETTERS BY PROMPTLY RETURNING
THE PROXY CARD.
1. DIRECTORS. The persons named as proxies intend to vote to re-elect the
five persons currently serving as directors, unless authority to vote for the
election of all or specified individuals is withheld by so marking the proxy
card. If any nominees are unable to serve, the persons named as proxies may vote
for other persons or vote to fix the number of directors at less than five.
Election is by a majority vote of the shares represented at the meeting. The
mailing address of each nominee is Box 2438, Los Angeles, CA 90051. The name,
age, principal occupation for the past five years and year of election of the
nominees, who have consented to serve if elected, are:
DONALD E. CANTLAY, 73, Managing General Partner of Cee'n'Tee Company.
(1981)(2)(4)
RICHARD N. LATZER, 58, President and Director of Transamerica Investment
Services. Senior Vice President and Chief Investment Officer of Transamerica
Corporation. (1989)(1)
DEWAYNE W. MOORE, 81, Retired Senior Vice President, Chief Financial Officer
and Director of Guy F. Atkinson Company of California. (1980)(3)(4)
GARY U. ROLLE, 53, President and Chairman of the Company. Executive Vice
President, Chief Investment Officer and Director of Transamerica Investment
Services. (1988)(1)(2)
PETER J. SODINI, 54, Associate, Freeman Spogli & Co. (1988)(2)(3)(4)
(1) "Interested person" as defined in the Investment Company Act of 1940, as
amended ("the 1940 Act"). These directors receive no fees or expense
reimbursements from the Company.
(2) Member of the Corporate Responsibility Committee, which reviews nominees
for appointment or election as directors. This Committee considers
nominations by
shareholders, which should be submitted in writing to the Secretary at the
above address.
(3) Member of the Audit Committee, which recommends the selection of auditors.
This Committee reviews the proposed scope of the audit, the results of both
audit and non-audit services and the fees for those services and supervises
internal controls. The Committee held one meeting during the fiscal year.
(4) Not an "interested person" as defined in the 1940 Act. These directors
receive $1,000 for each Board meeting attended, $250 for each Committee
meeting attended and reimbursement for travel expenses.
DIRECTOR NOMINEE COMPENSATION
TOTAL
COMPEN-
AGGREGATE SATION FOR
COMPEN- ALL RELATED
SATION FROM INVESTMENT
DIRECTOR NOMINEES COMPANY COMPANIES
- -------------------------- ----------- -----------
Donald E. Cantlay......... $ 4,000 $ 8,000
Richard N. Latzer......... -0- -0-
DeWayne W. Moore.......... 4,250 8,250
Gary U. Rolle............. -0- -0-
Peter J. Sodini........... 4,250 8,250
Transamerica Income Shares (the "Company") is a closed-end investment
Company traded on the New York Stock Exchange. Each of the nominees are also
members of the Board of Managers of variable annuity separate account funds "B"
and "C" sponsored by Transamerica Occidental Life Insurance Company, which pays
the director fees for those two funds. Funds B and C are registered investment
companies. Because the Company and funds B and C are advised by affiliated
companies wholly owned by Transamerica Corporation, total compensation for these
related investment companies is included in the Total Compensation column.
None of the director nominees currently receive any pension or retirement
benefits from the Company and thus will not receive any benefits funded by the
Company upon retirement.
The above data is for the Company's fiscal year, April 1, 1994 to March 31,
1995. During that year some of the above directors also served as a director of
Transamerica Cash Reserve ("Fund"), a money market mutual fund advised by
Transamerica Fund Management Company ("TFMC"), a wholly owned subsidiary of
Transamerica Corporation. Transamerica Investment Services, Inc. served as
sub-adviser to the Fund during a portion of the Company's fiscal year. In
December, 1994, TFMC was acquired by a subsidiary of John Hancock Mutual Life
Insurance Company, John Hancock Advisers became the Fund's investment adviser
and the Fund was renamed John Hancock Cash Reserve. The Total Compensation table
above includes compensation for director fees from the Fund paid prior to the
acquisition.
The Board held four meetings during the fiscal year. Each nominee for
director attended 75% or more of all Board and applicable committee meetings. At
the Company's fiscal year end on March 31, 1995, the following directors owned
Company shares, including shares held in family trusts: Mr. Cantlay 15,448 and
Mr. Moore 1,000, which holdings, together with shares owned by the Company's
officers, aggregate less than 1% of shares outstanding. Also on that date
Transamerica Occidental Life Insurance Company owned 479,575 shares or 7.6% of
shares outstanding and the Depository Trust Company ( a securities clearing
corporation) held of record but not beneficially 3,487,084 shares or 55.2% of
the outstanding shares. No person, to the Company's knowledge, owns beneficially
more than 10% of the Company's shares. At March 31, 1995, and on May 31, 1995,
the record date for voting at the annual meeting, 6,318,771 shares were
outstanding.
Section 30(f) of the 1940 Act requires the Company's officers, directors and
investment adviser, the affiliated persons of the investment adviser, and the
beneficial owners of more than ten percent of the Company's common stock to file
initial reports of ownership and reports of changes in ownership with the
Securities and Exchange Commission and the New York Stock Exchange, and to
provide copies of these reports to the Company. Based solely on a review of
copies of reports received by it and of written representations by reporting
persons that no additional reports are due, the Company believes that the
requirements for Section 30(f) filing and reporting of changes of beneficial
ownership during the fiscal year ended March 31, 1995, were satisfied.
2. MANAGEMENT AND INVESTMENT ADVISORY AGREEMENT. Transamerica Investment
Services, Inc., (the "Adviser"), a wholly owned subsidiary of Transamerica
Corporation, 600 Montgomery Street, San Francisco, CA 94111, provides
management, investment advisory and research services to the Company for an
annual fee of one-half of one percent of the Company's average net assets
(accrued weekly and payable monthly), and pays for office space, facilities,
equipment and salaries of the Company's officers. The Company pays all other
expenses, including taxes, brokerage, transfer agent fees, custodial fees, stock
exchange listing costs, shareholder reports, postage, auditing and legal fees.
The Adviser guarantees that the Company's expenses shall not exceed 1 1/2% of
the first $30 million of average net assets and 1% over $30 million. If that
limit is exceeded, the Adviser will pay the excess to the Company. The Agreement
must be renewed annually by the directors or a majority of the Company's shares,
and by a majority of the directors who are not "interested persons" of parties
to the Agreement. The Agreement was entered into in 1972 and was last ratified
by shareholders at the annual meeting of shareholders held on July 19, 1994.
The directors of the Company, and those directors who are not "interested
persons" of parties to the Agreement, on May 17, 1995, approved continuance of
the Agreement and recommended to shareholders ratification of that continuance.
In connection with its recommendation that shareholders ratify continuance of
the Agreement, the Board evaluated such factors as the Adviser's experience in
providing various financial services and investment advice to investment
companies and other clients, as well as its reputation, integrity, financial
responsibility and stability. The Board is provided and reviews on a continuing
basis, the Adviser's outlook for the economy, productivity and fixed income
investments; the Company's portfolio holdings and investment transactions;
characteristics of the portfolio including quality, maturity and call
protection; revenues received from the debt securities held and expenses of
operations; changes in the Company's net asset value, earnings and yield; the
Company's performance and its expenses as compared to other similar companies;
the quality and experience of the Adviser's officers and employees and the
Adviser's income, expenses, profitability and balance sheet. Based upon its
review, the Board concluded that the terms of the Agreement and the fees are
fair and reasonable, in light of usual and customary terms and charges made by
others for comparable services, and that it is in the best interests of the
Company and its shareholders to renew the Agreement. Shareholder ratification is
by a vote of 67% or more of the shares present at the meeting if more than 50%
of the shares are present or represented by proxy, or a vote of more than 50% of
the shares, whichever is less.
At the end of the fiscal year, March 31, 1995, the Company had net assets of
$147,669,572, and paid fees of $730,010 to the Adviser for advisory services
during the year. Advisory fees in the fiscal years ended in 1994 and 1993 were
$813,994 and $575,565.
The directors of the Adviser with ages indicated are Kent L. Colwell, 64,
Vice President, Real Estate Services of Transamerica Corporation; Thomas J.
Cusack, 39, Senior Vice President of Transamerica Corporation; Richard H. Finn,
60, Executive Vice President of Transamerica Corporation and President and Chief
Executive Officer of Transamerica Finance Group; Edgar H. Grubb, 56, Executive
Vice President and Chief Financial Officer of Transamerica Corporation; Frank C.
Herringer, 52, President and Chief Executive Officer of Transamerica
Corporation; Richard N. Latzer, 58, President of the Adviser and Senior Vice
President and Chief Investment Officer of Transamerica Corporation; and Gary U.
Rolle, 53, Executive Vice President and Chief Investment Officer of the Adviser.
In addition to Messrs. Latzer and Rolle (above) the officers of the Adviser are:
Susan A. Silbert, 51, Senior Vice President; Sharon K. Kilmer, 37, Vice
President and J. Richard Atwood, 35, Vice President, Chief Financial Officer and
Secretary. Each of the above five persons who are officers of the Company have
held the positions shown or executive positions in Transamerica Corporation or
Transamerica subsidiaries for more than five years except Mr. Atwood who, from
1988 to 1995 was Vice President and Controller of First Pacific Advisors, Inc.
The Adviser's mailing address is Box 2438, Los Angeles, CA 90051.
Decisions to buy and sell securities, selection of brokers or dealers, and
negotiation of commissions are made by the Adviser. Securities orders are placed
with brokers or dealers selected for their ability to give execution at prices
and commission rates (if any) favorable to the Company and, in some instances,
for the ability to provide research and other services. As part of the process
of brokerage allocation, the adviser is authorized to pay commissions which may
exceed what another broker might have charged. If portfolio business is
transacted with brokers or dealers which provide research, comparative Company
performance data, pricing quotations, or other services, the Company pays any
cost of such services and the Adviser and other investment companies advised by
the Adviser may benefit. Portfolio debt securities normally are bought from or
sold to an underwriter or market maker, and the dealer's compensation is
normally included in the price of the security.
Neither the Adviser nor any affiliate receives any brokerage commissions
from the Company. During the fiscal years ended March 31, 1993, 1994, and 1995,
the Company did not pay any brokerage commissions, and the portfolio turnover
rate was 32%, 15% and 15%, respectively.
3. AUDITORS. On May 17, 1995, the Audit Committee and the directors,
including a majority who are not "interested persons," selected Ernst & Young
LLP as the independent auditors for the current fiscal year. Ratification is by
a majority of the shares represented at the annual meeting. Services provided
include examination of the annual financial statements, meeting with the Audit
Committee, and review of federal income tax returns. Ernst & Young LLP will not
attend the annual meeting.
SHAREHOLDER PROPOSALS. Any shareholder proposal intended to be presented at
the 1996 annual meeting of shareholders must be received by the Company no later
than February 5, 1996, for inclusion in the proxy statement.
For the Board of Directors,
Thomas M. Adams,
Secretary
June 7, 1995
PROXY
TRANSAMERICA INCOME SHARES, INC.
ANNUAL MEETING OF SHAREHOLDERS, JULY 26, 1995
DONALD E. CANTLAY, DeWAYNE W. MOORE, and GARY U. ROLLE or any one of them,
are authorized to represent me and vote my shares of stock at the Annual Meeting
of Transamerica Income Shares, Inc. to be held in the offices of Transamerica
Investment Services, Inc., 1150 South Olive Street, 27th Floor, Los Angeles,
California on July 26, 1995 at 9:00 A.M. or at any adjournments on the matters
on the reverse side and on any other matters which may come before the meeting.
(Continued on reverse side)
THIS PROXY WILL BE VOTED AS YOU SPECIFY BELOW. IF NO SPECIFICATION IS MADE, THE
PROXY WILL BE VOTED FOR ITEMS 1, 2 AND 3.
1. Election of the Director Nominees listed below (except as marked)
FOR WITHHOLD D. Cantlay, R. Latzer, D. Moore, G. Rolle and P. Sodini
AUTHORITY
/ / / /
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.)
- -------------------------------------------------------------------------------
2. Continuance of the Management and 3. Ratification of Ernst & Young
Investment Advisory Agreement LLP as Independent Auditors
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
/ / / / / / / / / / / /
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS. HELP YOUR COMPANY SAVE THE EXPENSE OF
ANOTHER MAILING BY RETURNING THIS PROXY PROMPTLY.
Dated______________________________________, 1995
_________________________________________________
Signature
_________________________________________________
Signature if held jointly
(Executors and Trustees should so indicate)
"PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES"