SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14A-6(E)
(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-12
CONSECO STRATEGIC INCOME FUND
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(Name of Registrant as Specified In Its Charter)
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(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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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[LOGO](SM)
CONSECO(R)
CONSECO STRATEGIC INCOME FUND
11815 NORTH PENNSYLVANIA STREET
CARMEL, INDIANA 46032
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 5, 2002
To our Shareholders:
NOTICE IS HEREBY GIVEN THAT the Annual Meeting of Shareholders of Conseco
Strategic Income Fund (the "Fund"), will be held at the offices of Conseco
Capital Management, Inc., 535 College Drive, Building K, Carmel, Indiana, at
11:00 a.m., local time on December 5, 2002. The following proposals will be
voted on at the Meeting:
1. To elect two (2) Trustees to serve for terms ending in 2005
(Proposal No. 1);
2. To ratify the selection of PricewaterhouseCoopers LLP as the
Fund's independent accountants (Proposal No. 2); and
3. To transact such other business as may properly come before the
Meeting, or any adjournment or postponement thereof.
These items are discussed in greater detail in the attached Proxy
Statement.
Only shareholders of record at the close of business on October 10, 2002
are entitled to notice of, and to vote at, this Meeting or any adjournment
thereof.
By Order of the Trustees
William P. Kovacs, Secretary
October 24, 2002
Carmel, Indiana
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WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE SIGN AND PROMPTLY RETURN
THE ENCLOSED PROXY IN THE ENCLOSED SELF-ADDRESSED ENVELOPE. IN ORDER TO AVOID
THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITATION, WE ASK YOUR
COOPERATION IN MAILING IN YOUR PROXY PROMPTLY. INSTRUCTIONS FOR THE PROPER
EXECUTION OF PROXIES ARE SET FORTH ON THE INSIDE COVER.
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[LOGO](SM)
CONSECO(R)
CONSECO STRATEGIC INCOME FUND
11815 NORTH PENNSYLVANIA STREET
CARMEL, INDIANA 46032
PROXY STATEMENT
This Proxy Statement is furnished to shareholders in connection with the
solicitation of proxies by the Board of Trustees of the Conseco Strategic Income
Fund (the "Fund") for the Annual Meeting of Shareholders (the "Annual Meeting")
to be held at the offices of Conseco Capital Management, Inc., 535 College
Drive, Building K, Carmel, Indiana on December 5, 2002, at 11:00 a.m., local
time, (and at any adjournments thereof), for the purposes set forth in the
accompanying Notice of Annual Meeting of Shareholders.
Shareholders of record at the close of business on October 10, 2002 are
entitled to be present and to vote at the Annual Meeting. Each share of
beneficial interest of the Fund is entitled to one vote and each fractional
share shall be entitled to a proportionate fractional vote, except that shares
held in the treasury of the Fund as of the record date shall not be voted.
Shares represented by executed and unrevoked proxy cards will be voted in
accordance with the specifications made thereon. Returned proxy cards that are
unmarked will be voted in favor of the nominees for Trustee; in accordance with
the recommendation of the Board of Trustees as to all other proposals described
in the Proxy Statement and, at the discretion of the proxyholders, on any other
matter that may properly have come before the Annual Meeting or any adjournments
thereof.
If the enclosed proxy card is executed and returned, it nevertheless may
be revoked by another proxy card or by letter or telegram directed to the Fund.
To be effective, such revocation must be received prior to the meeting and
indicate the shareholder's name. In addition, any shareholder who attends the
meeting in person may vote by ballot at the meeting, thereby canceling any proxy
previously given. The solicitation of proxies will be made primarily by mail.
Authorization to execute proxies may be obtained by telephonic or electronically
transmitted instructions.
The holders of a majority of the Shares issued and outstanding and
entitled to vote present in person or represented by proxy shall be requisite
and shall constitute a quorum for the transaction of business. In the absence of
a quorum, the Shareholders present or represented by proxy and entitled to vote
at the Annual Meeting shall have power to adjourn the meeting from time to time.
Action on any matter is approved if the votes cast in favor of the action exceed
the votes cast against it. Any adjourned meeting may be held as adjourned
without further notice. At any adjourned meeting at which a quorum shall be
present, any business may be transacted as if the meeting had been held as
originally called.
Proxy materials will be mailed to Shareholders of record on or about
October 24, 2002. As of the record date, October 10, 2002, there were 6,819,065
shares of beneficial interest of the Fund. To the Fund's knowledge, no
shareholder beneficially owned five percent or more of its outstanding shares on
that date.
The Fund mailed a copy of its annual report for the last fiscal year on
August 29, 2002. Should you require an additional annual report, the Fund will
furnish, without charge, the report to any shareholder upon request. Such
requests should be directed to the Fund at 11815 North Pennsylvania Street,
Carmel, Indiana 46032, Attention: William P. Kovacs, Fund Secretary.
1
The principal executive offices of the Fund are located at 11815 North
Pennsylvania, Carmel, Indiana 46032. The Fund's investment adviser, Conseco
Capital Management, Inc. (the "Adviser" or "CCM"), is located at 11825 North
Pennsylvania Street, Carmel, Indiana 46032.
PROPOSAL NO. 1: ELECTION OF TRUSTEES
The Board of Trustees (the "Board") consists of seven (7) members serving
staggered terms of office. The two Trustees to be elected at the Annual Meeting
have been nominated to serve a term of three years expiring in 2005. All
Trustees will serve until their successors are duly elected and qualified. Each
Trustee, with the exception of Mr. Walthall, has served as Trustee since the
Fund's commencement of operations in July 1998. Mr. Walthall has served as
Trustee since December 1998.
The persons named upon the accompanying proxy card intend to vote each
such proxy for the election of the Nominees, unless shareholders specifically
indicate on their proxy card the desire to withhold authority to vote for
elections to office. It is not contemplated that any Nominee will be unable to
serve as a Board member for any reason, but if that should occur prior to the
meeting, the proxyholders reserve the right to substitute another person or
persons of their choice as nominee or nominees.
The following information regarding each person nominated for election as
a Trustee, and each person whose term will continue after the Annual Meeting,
includes such person's age, positions with the Adviser (if any), principal
occupation and business experience for the last five years:
NUMBER OF
CONSECO
FAMILY OF
FUNDS AND
PRINCIPAL OCCUPATION AND PORTFOLIOS PUBLIC
NAME OF NOMINEE AGE BUSINESS EXPERIENCE OVERSEEN** DIRECTORSHIPS
- ---------------- ---- ------------------------ ---------- -------------
TERM EXPIRES 2005
HAROLD W.
HARTLEY 79 Trustee of the Fund: Chartered 4 registered Ennis Business
Financial Analyst; Retired, investment Forms, Inc.
Executive Vice President, Tenneco companies
Financial Services, Inc.; Trustee consisting of
of other investment companies 18 portfolios
managed by the Adviser.
DR. R. JAN LECROY 71 Trustee of the Fund; Retired, 4 registered SWS Group, Inc.
President, Dallas Citizens investment
Council; Trustee of other companies
investment companies managed consisting of
by the Adviser. 18 portfolios
OTHER TRUSTEES
TERM EXPIRES 2003
MAXWELL E. BUBLITZ* 47 Trustee and President of the Fund: 4 registered None
Chartered Financial Analyst; investment
CEO, President and Director, companies
CCM; Senior Vice President, consisting of
Investments of Conseco, Inc.; 18 portfolios
President and Trustee of other
investment companies managed by
the Adviser.
2
NUMBER OF
CONSECO
FAMILY OF
FUNDS AND
PRINCIPAL OCCUPATION AND PORTFOLIOS PUBLIC
OTHER TRUSTEES AGE BUSINESS EXPERIENCE OVERSEEN** DIRECTORSHIPS
- ---------------- ---- ------------------------ ---------- -------------
TERM EXPIRES 2003
WILLIAM P. DAVES, Jr. 77 Trustee and Chairman of the 4 registered None
Board of the Fund: Consultant to investment
insurance and healthcare industries; companies
Former Director, Chairman and consisting of
Chief Executive Officer, FFG 18 portfolios
Insurance Co.; Chairman of the
Board and Trustee of other investment
companies managed by the Adviser.
TERM EXPIRES 2004
GREGORY J. HAHN* 41 Trustee and Vice President for 4 registered None
Investments of the Fund: Chartered investment
Financial Analyst; Senior Vice companies
President, Adviser; Trustee, officer consisting of
and portfolio manager of other 18 portfolios
investment companies managed by the
Adviser.
DR. JESS H. PARRISH 74 Trustee of the Fund: Higher 4 registered None
Education Consultant; Former investment
President, Midland College; Trustee companies
of other investment companies consisting of
managed by the Adviser. 18 portfolios
DAVID N. WALTHALL 57 Trustee of the Fund: Principal, 4 registered None
Walthall Asset Management; Formerly investment
President, Chief Executive Officer companies
and Director of Lyrick Corporation; consisting of
Formerly, President and CEO, Heritage 18 portfolios
Media Corporation; Formerly, Director,
Eagle National Bank; Trustee of other
investment companies managed by the
Adviser.
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* The Trustees so indicated are considered "interested persons," of the Fund as
defined in the Investment Company Act of 1940, as amended (the "1940 Act"),
due to their employment with the Adviser and its affiliates.
** The Conseco Family of Funds consists of Conseco Strategic Income Fund,
Conseco Fund Group, Conseco Series Trust and Conseco StockCar Stocks Mutual
Fund, Inc.
All Trustees and officers have a mailing address c/o Conseco Capital
Management, Inc., 11825 North Pennsylvania Street, Carmel, Indiana 46032.
AUDIT COMMITTEE
The Fund has an Audit Committee comprised of all of the Trustees who are
not "interested persons" of the Fund within the meaning of the Investment
Company Act and who are "independent" as defined in the listing standards of the
New York Stock Exchange (NYSE). The principal responsibilities of the Audit
Committee are to (1) review and recommend to the Board for its con-
3
sideration the Fund's independent accountants; (2) review with the independent
accountants the scope and performance of the audit; (3) discuss with the
independent accountants certain matters relating to the Fund's financial
statements, including any adjustment to such financial statements recommended by
such independent accountants; (4) review on a periodic basis a formal written
statement from the independent accountants with respect to their independence,
discuss with the independent accountants any relationships or services disclosed
in the statement that may impact the objectivity and independence of the Fund's
independent accountants; and (5) consider the comments of the independent
accountants and management's responses thereto with respect to the quality and
adequacy of the Fund's accounting and financial reporting policies, practices
and internal controls.
The Fund has adopted an Audit Committee Charter (the "Charter"), which is
attached as Exhibit B to this Proxy Statement. The Fund's Audit Committee has
received written disclosures and the letter required by the Independence
Standards Board Standard No. 1 from PricewaterhouseCoopers LLP ("PWC"),
independent accountants to the Fund.
For the fiscal year ended June 30, 2002, PWC performed both audit and
non-audit services for the Fund. Audit services consisted of examinations of the
Fund's financial statements and review and consultation in connection with
filings with the Securities and Exchange Commission (the "SEC"). Non-audit
services included reviewing tax returns of the Fund.
FEES PAID TO INDEPENDENT ACCOUNTANTS FOR AUDIT SERVICES
For the audit of the Fund's annual financial statements for the fiscal
year ended June 30, 2002, included in the Fund's annual report to shareholders
for that fiscal year, the Fund paid $37,000 to PWC.
FINANCIAL INFORMATION SYSTEM DESIGN AND IMPLEMENTATION FEES
For the fiscal year ended June 30, 2002, the Fund, CCM and entities
controlling, controlled by or under common control with CCM which provide
services to the Fund did not pay or accrue any fees for financial information
systems design and implementation services by PWC.
OTHER NON-AUDIT, NON-SYSTEMS SERVICES
For the fiscal year ended June 30, 2002, the Fund, CCM and entities
controlling, controlled by or under common control with CCM which provide
services to the Fund paid or accrued aggregate fees of approximately $54,845 in
audit fees and $51,250 for other services provided by PWC. The Audit Committee
has determined that the provision of the services described above is compatible
with maintaining the independence of PWC.
OTHER COMMITTEES
The Fund also has a nominating committee and a compensation committee
comprised of its independent Trustees. The nominating committee reviews and
nominates candidates to serve as independent Trustees. The nominating committee
generally will not consider nominees recommended by stockholders of the Fund.
COMMITTEE AND BOARD OF TRUSTEES MEETINGS
During the Fund's fiscal year ended June 30, 2002, the Board of Trustees
held five meetings and one committee meeting. Each of the Trustees then in
office attended at least 75% of the aggregate of the total number of meetings of
the Board of Trustees and committee meetings held during the fiscal year.
4
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the officers and Trustees of the Fund and persons who
own more than ten percent of a registered class of the Fund's equity securities
to file reports of ownership and changes in ownership on Forms 3, 4 and 5 with
the Securities and Exchange Commission ("SEC") and the New York Stock Exchange
("NYSE"). Officers, Trustees and greater than ten percent stockholders of the
Fund are required by SEC regulations to furnish the Fund with copies of all
filed Forms 3, 4 and 5.
Based solely on each Fund's review of the copies of such forms, and
amendments thereto, furnished to it during or with respect to its most recent
fiscal year, and written representations from certain reporting persons that
they were not required to file Form 5 with respect to the most recent fiscal
year, each Fund believes that all of its officers, Trustees, greater than ten
percent beneficial owners and other persons subject to Section 16 of the
Exchange Act due to the requirements of Section 30 of the Investment Company Act
(i.e. any advisory board member, investment adviser or affiliated person of the
Fund's investment adviser) have complied with all filing requirements applicable
to them with respect to transactions during the Fund's most recent fiscal year.
COMPENSATION OF TRUSTEES
Each Trustee who is not an "interested person" of the Fund receives an
annual retainer fee of $7,500, a fee of $1,500 for each Board meeting,
independent Trustee meeting or separate committee meeting, that is committee
meeting(s) not conducted in conjunction with a Board meeting or independent
Trustee meeting, they attend. Additionally, each Trustee receives a fee of $500
for Board meetings and separate committee meetings attended that are conducted
by telephone. The Chairman of the Board receives an additional per meeting fee
of $375 for in-person Board meetings. The Fund also reimburses each Trustee who
is not an "interested person" of the Fund for travel and out-of-pocket expenses.
CCM, the investment adviser to the Fund, pays all compensation to all officers
of and all Trustees of the Fund who are affiliated with CCM.
The Fund does not pay any other remuneration to its officers and Board
members, and the Fund does not have a bonus, pension, profit-sharing or
retirement plan.
The aggregate amount of compensation paid to each Trustee by the Fund for
the fiscal year ended June 30, 2002, and by all funds in the Conseco Family of
Funds for which such Trustee was a Board member (the number of which is set
forth in parenthesis next to each Trustee's total compensation) for the year
ended December 31, 2001, was as follows:
TOTAL COMPENSATION
AGGREGATE FROM FUND AND CONSECO
COMPENSATION FAMILY OF FUNDS COMPLEX
NAME OF TRUSTEE FROM FUND* PAID TO TRUSTEE**
- -------------- -------------- -----------------------
William P. Daves, Jr. $15,500 $57,938 (18)
Harold W. Hartley $14,000 $51,375 (18)
Dr. R. Jan LeCroy $14,000 $51,375 (18)
Dr. Jess H. Parrish $12,000 $51,250 (18)
David N. Walthall $14,000 $51,375 (18)
- ----------
* Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $1,908 for all Trustees as a group.
** Represents TOTAL COMPENSATION FROM ALL investment companies in the Conseco
Family of Funds Complex, including the Fund, for which the Trustee serves
as a Board Member.
5
STOCK OWNERSHIP
AGGREGATE DOLLAR RANGE
AGGREGATE DOLLAR RANGE OF SECURITIES IN ALL CONSECO
TRUSTEES OF EQUITY IN THE FUND FAMILY OF FUNDS COMPLEX
- -------- ---------------------- ----------------------------
Maxwell E. Bublitz* None None
William P. Daves, Jr. $50,001 - $100,000 $50,001 - $100,000
Gregory J. Hahn* $10,001 - $50,000 $10,001 - $50,000
Harold W. Hartley $10,001 - $50,000 $10,001 - $50,000
Dr. R. Jan LeCroy None None
Dr. Jess H. Parrish None over $100,000
David N. Walthall None None
- ----------
* The Trustees so indicated are considered "interested persons," of the Fund as
defined in the Investment Company Act of 1940, as amended (the "1940 Act"),
due to their employment with the Adviser and its affiliates.
To the knowledge of the Fund's management, as of the Record Date, the
Trustees and officers of the Fund owned an aggregate of less than one percent of
the outstanding shares of the Fund.
THE FUND'S BOARD OF TRUSTEES, INCLUDING THE "INDEPENDENT" TRUSTEES, RECOMMENDS
THAT SHAREHOLDERS VOTE "FOR" ELECTION OF
EACH OF THE NOMINEES TO SERVE AS TRUSTEES OF THE FUND.
PROPOSAL NO. 2: RATIFICATION OF
THE SELECTION OF INDEPENDENT ACCOUNTANTS
The Fund's independent accountants must be appointed by a majority of
those Trustees who are not "interested persons" (as defined in the 1940 Act) of
the Fund, and such selection may be submitted for ratification or rejection at
the Annual Meeting of Shareholders; and the employment of such independent
accountants must be conditioned upon the right of the Fund, by vote of a
majority of its outstanding securities at any meeting called for that purpose,
to terminate such employment forthwith without penalty. The Board, including a
majority of those Trustees who are not "interested persons" of the Fund,
approved the selection of PricewaterhouseCoopers LLP for the fiscal year ending
June 30, 2003 at a Board meeting held on May 16, 2002. Accordingly, the
selection by the Board of PricewaterhouseCoopers LLP as independent accountants
of the Fund for the fiscal year ending June 30, 2003 is submitted to
shareholders for ratification. Apart from fees received as independent
accountants, neither PricewaterhouseCoopers LLP nor any of its partners has a
direct, or material indirect, financial interest in the Fund.
PricewaterhouseCoopers LLP has acted as independent accountants of the
Fund since the Fund's organization. The Board believes that the continued
employment of PricewaterhouseCoopers LLP for the fiscal year ending June 30,
2003 is in the best interests of the Fund.
A representative of PricewaterhouseCoopers LLP may be present at the
meeting to respond to appropriate questions.
THE FUND'S BOARD OF TRUSTEES, INCLUDING THE "INDEPENDENT" TRUSTEES, RECOMMENDS
THAT SHAREHOLDERS VOTE "FOR" RATIFICATION OF THE SELECTION OF
PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT ACCOUNTANTS OF THE FUND.
OTHER MATTERS
If a proxy card is properly executed and returned accompanied by
instructions to withhold authority to vote, represents a broker "non-vote" (that
is, a proxy card from a broker or nominee indicating that such person has not
received instructions from the beneficial owner or other person entitled to vote
shares of the Fund on a particular matter with respect to which the broker or
6
nominee does not have discretionary power) or marked with an abstention
(collectively, "abstentions"), the Fund's shares represented thereby will be
considered to be present at the meeting for purposes of determining the
existence of a quorum for the transaction of business. Under Massachusetts law,
abstentions do not constitute a vote "for" or "against" a matter and will be
disregarded in determining "votes cast" on an issue.
The Board is not aware of any other matter, which may come before the
meeting. However, should any such matter with respect to the Fund properly come
before the meeting, it is the intention of the proxy holders to vote the proxy
in accordance with their judgment on any such matter.
The Fund will request broker/dealer firms, custodians, nominees and
fiduciaries to forward proxy materials to the beneficial owners of the shares
held of record. The Fund will reimburse such broker/dealer firms, custodians,
nominees and fiduciaries for their reasonable expenses incurred in connection
with such proxy solicitation. In addition to the solicitation of proxies by
mail, officers of the Fund and employees of the Adviser and its affiliates,
without additional compensation, may solicit proxies in person, by telephone or
otherwise.
The Fund will bear the cost of soliciting proxies. In addition to the use
of the mail, proxies may be solicited personally, by telephone, by telegraph, or
by electronic transmission (e-mail).
Proposals that shareholders wish to include in the Fund's proxy statement
for the Fund's next Annual Meeting of Shareholders must be sent to and received
by the Fund no later than June 22, 2003 at the principal executive offices of
the Fund at 11815 North Pennsylvania Street, Carmel, Indiana 46032.
ADDITIONAL INFORMATION
Conseco Capital Management, Inc., located at 11825 North Pennsylvania
Street, Carmel, Indiana 46032, serves as the Fund's investment adviser.
PFPC, Inc., located at 400 Bellevue Parkway, Wilmington, Delaware 19809,
serves as the Fund's transfer agent and accounting servicing agent.
NOTICE TO BANKS, BROKER/DEALERS VOTING TRUSTEES
AND THEIR NOMINEES
Please advise the Fund, in care of PFPC, Inc., whether other persons are
the beneficial owners of the shares for which proxies are being solicited and,
if so, the number of copies of the proxy statement and other soliciting material
you wish to receive in order to supply copies to the beneficial owners of
shares.
IT IS IMPORTANT THAT PROXY CARDS BE RETURNED PROMPTLY. THEREFORE,
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED STAMPED
ENVELOPE.
Dated: October 24, 2002
7
EXHIBIT A
The following sets forth information regarding the executive officers of
the Fund.
PRINCIPAL OCCUPATION
AND BUSINESS
NAME AND POSITION EXPERIENCE FOR PAST
WITH FUND AGE FIVE YEARS
- ----------------- --- --------------------
MAXWELL E. BUBLITZ 47 Chartered Financial Analyst;
President CEO, President and Director, CCM;
Senior Vice President, Investments
of Conseco, Inc.; President and
Trustee of other investment
companies managed by the Adviser.
GREGORY J. HAHN 41 Chartered Financial Analyst;
Vice President Senior Vice President, CCM; Trustee,
officer and portfolio manager of
other investment companies managed
by the Adviser.
WILLIAM P. KOVACS, ESQ. 56 Vice President, Senior Counsel,
Vice President and Secretary Chief Compliance Office and Director
of CCM. Vice President and Secretary
of other investment companies
managed by the Adviser. Previously,
Of Counsel to Shefsky & Froelich and
Rudnick & Wolfe; Prior thereto, Vice
President and Assistant Secretary,
Kemper Financial Services, Inc.
AUDREY L. BRUCH 35 Certified Public Accountant;
Treasurer Controller, CCM. Treasurer of other
investment companies managed by the
Adviser.
WILLIAM T. DEVANNEY 47 Senior Vice President,
Vice President Corporate Taxes, of Conseco Services,
LLC and various affiliates. Vice
President of other investment
companies managed by the Adviser.
8
EXHIBIT B
CONSECO STRATEGIC INCOME FUND
AUDIT COMMITTEE OF THE BOARD OF TRUSTEES CHARTER
ORGANIZATION
The Audit Committee shall be composed of all independent trustees. Each of
the committee members shall have a working familiarity with basic finance and
accounting practices and at least one member of the Committee shall have
accounting or related financial management expertise.
Audit Committee members shall meet the independence and experience
requirements of the New York Stock Exchange. The committee members shall be
independent of the management of the Company and free of any relationship that,
in the opinion of the Board of Trustees, would interfere with their exercise of
independent judgment. Determinations as to whether a particular director
satisfies the requirements for membership on the Audit Committee shall be made
by the full Board of Trustees.
STATEMENT OF POLICY
Primary responsibility for the Company's financial reporting lies with
management, overseen by the Board of Trustees. The Audit Committee shall provide
assistance to the Board of Trustees in fulfilling their responsibilities. As
such, the Audit Committee will provide an open avenue of communication among the
trustees, the outside accountants, the internal auditors, and the management of
the Company.
While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the outside auditor. Nor is it the
duty of the Audit Committee to conduct investigations, to resolve disagreements,
if any, between management and the outside auditor or to assure compliance with
laws and regulations.
RESPONSIBILITIES
The Audit Committee believes its policies and procedures should remain
flexible to best react to changing conditions. In carrying out its
responsibilities, the Audit Committee will:
1. Review and recommend to the Board of Trustees for its consideration,
the outside auditor to audit the financial statements of the Company. The
outside auditor is ultimately accountable to the Board of Trustees and the Audit
Committee.
2. Obtain a formal written statement from the outside auditor delineating
all relationships between the auditor and the Company, consistent with
Independence Standards Board Standard No. 1, INDEPENDENCE DISCUSSIONS WITH AUDIT
COMMITTEES, to ensure the outside auditor's independence is affirmed. It will
discuss with the Board of Trustees, if necessary, any relationships between the
outside auditor and the Company or any other relationships that may adversely
affect the independence of the outside auditor.
3. Meet with the outside accountants, internal auditors (if necessary),
and management of the Company to review the scope of the proposed audit for the
current year and the audit procedures to be utilized. At the conclusion thereof,
review such audit, including any comments or recommendations of the outside
accountants.
4. Meet with the Company's outside accountants, internal auditors (if
necessary), and management, to review the adequacy and effectiveness of
accounting and financial controls and policies and procedures.
9
5. Review the financial statements and related matters with management and
the outside accountants. Recommend to the Board of Trustees that the audited
financial statements be included in the Annual Report on Form 10-K for filing
with the Securities and Exchange Commission (SEC). For interim financial
statements, either the Committee as a whole or the Committee Chair will be
available to the outside accountants to discuss the Company's interim financial
statements.
6. Provide sufficient opportunity for the outside accountants to meet with
the members of the Audit Committee without members of management present to
discuss any matters that the Audit Committee believe should be discussed
privately with the Audit Committee.
7. Report Audit Committee actions periodically to the Board of Trustees
with such recommendations as the Committee may deem appropriate.
8. Review and discuss the Audit Committee Charter at least annually and at
such other intervals as the Audit Committee or the Board of Trustees determines.
9. The Audit Committee also may perform such other activities, consistent
with this Charter, the Company's Articles of Incorporation, its By-laws, and
applicable law, as the Audit Committee or the Board of Trustees deems necessary
or appropriate.
In performing its duties under this Charter the Audit Committee shall have
the power to retain outside legal, accounting, or other experts it deems
necessary.
10
PROXY
CONSECO STRATEGIC INCOME FUND
ANNUAL MEETING OF SHAREHOLDERS - DECEMBER 5, 2002
The undersigned shareholder of Conseco Strategic Income Fund (the "Fund")
hereby appoint(s) William P. Kovacs, Karl W. Kindig and Sarah L. Todd, or any
one of them, attorneys with full power of substitution, to vote, as indicated
herein, all of the shares of beneficial interest (the "shares") of the Fund
standing in the name of the undersigned at the close of business on October 10,
2002 at the Annual Meeting of Shareholders of the Fund to be held at the Conseco
Capital Management Offices, 535 N. College Drive, Building K, Carmel, Indiana on
December 5, 2002 at 11:00 a.m., and any and all adjournments thereof; with all
the powers the undersigned would possess if then and there personally present
and especially (but without limiting the general authorization and power hereby
given) to vote as indicated on the proposals, as more fully described in the
Proxy Statement for the meeting.
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES AND WILL BE VOTED "FOR"
ELECTION OF THE PROPOSED TRUSTEES AND "FOR" THE PROPOSALS LISTED ON THE REVERSE
SIDE, UNLESS OTHERWISE INDICATED.
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
- ------------- -------------
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
- ------------- -------------
|X| PLEASE MARK |
VOTES AS IN |___
THIS EXAMPLE.
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES AND WILL BE VOTED "FOR"
ELECTION OF THE PROPOSED TRUSTEES AND "FOR" THE PROPOSALS BELOW, UNLESS
OTHERWISE INDICATED.
FOR AGAINST ABSTAIN
1. Election of Trustees. 2. To ratify the selection of |_| |_| |_|
PricewaterhouseCoopers LLP
NOMINEES: (01) Harold W. Hartley as independent accountants
(02) Dr. R. Jan LeCroy of the Fund.
FOR |_| |_| WITHHOLD 3. In their discretion, the Proxies are authorized to
ALL FROM ALL vote upon such other business as may properly come
NOMINEES NOMINEES before the meeting, or any adjournment or
adjournments.
|_| -------------------------------------- MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT |_|
For all nominees except as noted above
SIGNATURE(S) SHOULD BE EXACTLY AS NAME OR NAMES
APPEARING ON THIS PROXY. IF SHARES ARE HELD JOINTLY,
EACH HOLDER SHOULD SIGN. IF SIGNING IS BY ATTORNEY,
ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE FULL
TITLE.
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING
THE ENCLOSED ENVELOPE TO:
Proxy Services, PFPC Inc., P.O. Box 43052, Providence,
RI 02940-5105
IMPORTANT: No matter how many shares you own, please
sign, date and mail your proxy IMMEDIATELY.
To hold the meeting, a majority of the shares eligible
to vote is required by law to be represented.
Therefore, it is important that you vote now so that
your Fund will not have to bear the unnecessary
expense of another solicitation of proxies.
PLEASE MARK BOXES IN BLUE OR BLACK INK.
Signature: Date: Signature: Date:
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