As filed with the Securities and Exchange Commission on December 19, 2001
Registration No. 333-73146
================================================================================
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
[X] Pre-Effective Amendment No. 2 [ ] Post-Effective Amendment No. _____
(Check appropriate box or boxes)
- --------------------------------------------------------------------------------
Exact name of Registrant as Specified in Charter:
THE HARTFORD MUTUAL FUNDS, INC.
Address of Principal Executive Offices:
P.O. Box 2999
Hartford, Connecticut 06104-2999
Registrant's Telephone Number: (860) 297-6443
Name and Address of Agent for Service: Copy to:
Kevin J. Carr, Esq. Kathleen L. Prudhomme, Esq.
Investment Law Unit Dorsey & Whitney LLP
The Hartford Financial Services Group, Inc. Suite 1500
55 Farmington Avenue 50 South Sixth Street
Hartford, Connecticut 06105 Minneapolis, Minnesota 55402
Approximate Date of Proposed Public Offering:
As soon as possible following the effective date of this Registration Statement.
- --------------------------------------------------------------------------------
The title of the securities being registered is shares of common stock.
No filing fee is required because an indefinite number of shares of the
Registrant have previously been registered on Form N-1A (Registration Nos.
333-02381, 811-07589) pursuant to Rule 24f-2 under the Investment Company Act of
1940. The Registrant's Rule 24f-2 Notice for the fiscal year ended October 31,
2000 was filed on January 9, 2001. Pursuant to Rule 429 under the Securities Act
of 1933, this Registration Statement relates to the shares previously registered
on the aforesaid Registration Statement on Form N-1A.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine. This Registration Statement shall hereafter become effective in
accordance with the provisions of Section 8(a) of the Securities Act of 1933.
================================================================================
THE FORTIS FUNDS
FORTIS ASSET ALLOCATION PORTFOLIO
FORTIS GLOBAL GROWTH PORTFOLIO
FORTIS GROWTH & INCOME FUND
FORTIS HIGH YIELD PORTFOLIO
FORTIS INTERNATIONAL EQUITY PORTFOLIO
FORTIS MONEY FUND
(EACH A SERIES OF HARTFORD-FORTIS SERIES FUND, INC.)
500 BIELENBERG DRIVE
WOODBURY, MINNESOTA 55125
MAILING ADDRESS:
P.O. BOX 64284
ST. PAUL, MINNESOTA 55164
Dear Shareholder:
The Board of Directors of the mutual funds listed above (each, a "Fortis
Fund") is pleased to submit for your vote a proposal to reorganize each Fortis
Fund into a comparable mutual fund in the Hartford fund family (each, a
"Hartford Fund"). As you know, The Hartford Life and Accident Insurance Company
("Hartford Life"), an indirect wholly owned subsidiary of The Hartford Financial
Services Group, Inc. ("The Hartford") acquired Fortis Advisers, Inc. and Fortis
Investors, Inc., the former investment adviser and distributor of the Fortis
Funds, on April 2, 2001 (the "Acquisition"). Since that time, Hartford
Investment Financial Services, LLC ("HIFSCO") has been serving as investment
adviser and either Hartford Investment Management Company ("HIMCO") or
Wellington Management Company LLP ("Wellington Management") has been serving as
sub-adviser to your Fortis Fund. HIFSCO and either HIMCO or Wellington
Management also act as adviser and sub-adviser to the funds in the Hartford fund
family. OUR GOAL IS TO CONSOLIDATE SIMILAR FUNDS IN THE FORTIS AND HARTFORD FUND
FAMILIES INTO A SINGLE, BROADLY DIVERSIFIED FAMILY OF MUTUAL FUNDS. Those funds
in the Fortis fund family that are not being reorganized will be re-named and
added to the Hartford fund family.
THE BOARD OF DIRECTORS BELIEVES THAT THE TRANSACTION IS IN THE BEST
INTERESTS OF EACH FORTIS FUND AND ITS SHAREHOLDERS AND UNANIMOUSLY RECOMMENDS
THAT YOU VOTE FOR ITS APPROVAL.
The Board considered various factors in reviewing the proposed
reorganization on behalf of Fortis Fund shareholders, including, but not limited
to, the following:
- The Board considered the fact that the Hartford Funds have investment
objectives that are substantially similar and investment policies that
are substantially identical to those of corresponding Fortis Funds. Since
the Acquisition, corresponding Hartford and Fortis Funds have been
managed by the same portfolios managers, using the same investment
policies and strategies.
- Because the combination will result in each reorganized Fund having a
larger asset base, and because the reorganized Funds will have access to
The Hartford's large distribution network which may generate additional
assets, the Board believes the reorganization may provide shareholders
the benefit of economies of scale.
- Hartford Life or the applicable Hartford Funds will bear the customary
expenses associated with the reorganization.
- The combination should allow you to benefit from The Hartford's larger
family of retail mutual funds, which will provide you with substantially
enhanced exchange privileges.
- The reorganization is expected to be tax-free; it is anticipated you will
pay no federal income tax as a result of the reorganization.
- The Board considered that the expense ratios after voluntary fee waivers
of the Hartford Funds are within industry norms and are comparable to or
slightly lower than those of the corresponding Fortis Funds in three out
of six cases when comparing Class A shares. The Board determined that,
in cases where Hartford Fund expenses are higher, the expected benefits
of the reorganization to Fortis Fund shareholders counterbalance the
increased expenses.
If the proposal is approved, each Hartford Fund will acquire all of the
assets of a Fortis Fund that has substantially similar investment objectives,
and substantially identical investment policies and strategies, and Hartford
Fund shares of the same or a similar class will be distributed pro rata to you
in complete liquidation of the Fortis Fund. In order to exchange your Fortis
Fund shares for Hartford Fund shares, the Board of Directors of the Fortis Funds
submits for your approval an Agreement and Plan of Reorganization ("Plan") that
relates to your Fortis Fund.
Your vote on the transaction is critical to its success. Representatives of
Hartford Administrative Services Company, Hartford Life, or a proxy solicitation
firm, Georgeson Shareholder, may be contacting you to urge you to vote on this
important matter. The reorganization of your Fortis Fund will occur only if
approved by a majority of the votes cast in person or by proxy at the meeting.
Whether or not you plan to attend the meeting, please vote your shares by
toll-free telephone call, by the Internet or by mail. IF YOU ARE A SHAREHOLDER
OF MORE THAN ONE FORTIS FUND INVOLVED IN THE PROPOSED REORGANIZATIONS, YOU HAVE
RECEIVED MORE THAN ONE PROXY CARD WITH THIS MAILING AND WILL NEED TO VOTE YOUR
SHARES OF EACH FUND. Following this letter is a Q&A summarizing the
reorganization and information on how you vote your shares. Please read the
entire prospectus/proxy statement carefully before you vote.
Thank you for your prompt attention and participation.
Sincerely,
/s/ DAVID M. ZNAMIEROWSKI
--------------------------------------
David M. Znamierowski
President
THE FORTIS FUNDS/THE HARTFORD FUNDS
PROXY Q&A
THE FOLLOWING IS IMPORTANT INFORMATION TO HELP YOU UNDERSTAND THE PROPOSAL
ON WHICH YOU ARE BEING ASKED TO VOTE. PLEASE READ THE ENTIRE PROXY STATEMENT.
WHY IS THIS REORGANIZATION BEING PROPOSED?
Since the acquisition of Fortis Advisers and Fortis Investors by Hartford
Life, HIFSCO has acted as the investment adviser to both the Fortis fund family
and the Hartford fund family. Our goal in proposing the reorganization is to
consolidate similar funds in the two fund families, creating a single, broadly
diversified family of mutual funds.
Your Board of Directors has determined that the reorganization is in the
best interests of Fortis Fund shareholders and recommends that you vote FOR the
reorganization. Benefits to Fortis Fund shareholders will include:
- The potential for each reorganized fund, as a result of having a larger
asset base, to benefit from economies of scale.
- The opportunity to become part of a growing and competitive fund family
and to benefit from The Hartford's larger family of retail mutual funds,
which will provide you with substantially enhanced exchange privileges,
and its large distribution network.
- As explained below, the reorganization is expected to be tax free to
Fortis Fund shareholders.
WHEN WILL THIS REORGANIZATION BECOME EFFECTIVE?
If shareholder approval is obtained, the reorganization is scheduled to be
effective on or about February 19, 2002.
CAN I MAKE ADDITIONAL INVESTMENTS IN MY FORTIS FUND BEFORE THE REORGANIZATION?
Yes. You can continue to make investments until the effective date of the
reorganization.
IS THERE ANYTHING I NEED TO DO TO CONVERT MY SHARES?
No. Upon shareholder approval of the reorganization, your Fortis Fund
shares automatically will be exchanged for shares of the same or a similar class
in the corresponding Hartford Fund. The total value of the Hartford Fund shares
that you receive will be the same as the total value of the Fortis Fund shares
that you hold immediately before the reorganization.
WILL I INCUR TAXES AS A RESULT OF THIS REORGANIZATION?
This reorganization is expected to be a tax-free event. Generally,
shareholders will not incur capital gains or losses on the conversion from
Fortis Fund shares into Hartford Fund shares as a result of this reorganization.
Furthermore, the cost basis on each investment will remain the same.
Shareholders will incur capital gains or losses if they sell their Fortis
Fund shares before the reorganization becomes effective or sell/exchange their
Hartford Fund shares after the reorganization becomes effective. Shareholders
will also be responsible for tax obligations associated with monthly or periodic
distributions that occur prior to the reorganization. The Fortis Funds will be
required to distribute any realized capital gains to shareholders prior to the
reorganization, and these distributions generally will be taxable to
shareholders. Please note that retirement accounts are exempt from the foregoing
tax consequences.
WHEN SHOULD I VOTE?
Please vote as soon as possible, by mail, by telephone or by the Internet.
Representatives of Hartford Administrative Services Company, Hartford Life, or a
proxy solicitation firm, Georgeson Shareholder, may be contacting you to urge
you to vote on this important matter.
WHO IS PAYING THE COST OF THE SHAREHOLDER MEETING AND OF THIS PROXY
SOLICITATION?
Hartford Life or the applicable Hartford Fund is paying the customary
expenses associated with the reorganization.
THE FORTIS FUNDS
FORTIS ASSET ALLOCATION PORTFOLIO
FORTIS GLOBAL GROWTH PORTFOLIO
FORTIS GROWTH & INCOME FUND
FORTIS HIGH YIELD PORTFOLIO
FORTIS INTERNATIONAL EQUITY PORTFOLIO
FORTIS MONEY FUND
(EACH A SERIES OF HARTFORD-FORTIS SERIES FUND, INC.)
500 BIELENBERG DRIVE
WOODBURY, MINNESOTA 55125
MAILING ADDRESS:
P.O. BOX 64284
ST. PAUL, MINNESOTA 55164
NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS
A Special Meeting of Shareholders of each of the Fortis Funds listed above
(each a "Fortis Fund") will be held on January 31, 2002, at 10:00 a.m., Central
Time at 500 Bielenberg Drive, Woodbury, Minnesota 55125 , for the following
purposes:
1. TO APPROVE A PROPOSED AGREEMENT AND PLAN OF REORGANIZATION
("PLAN") BETWEEN HARTFORD-FORTIS SERIES FUND, INC. AND THE HARTFORD MUTUAL
FUNDS, INC. WHEREBY ALL OF THE ASSETS OF EACH FORTIS FUND WOULD BE ACQUIRED
BY A COMPARABLE MUTUAL FUND IN THE HARTFORD FUND FAMILY (EACH A "HARTFORD
FUND") IN EXCHANGE FOR THE HARTFORD FUND'S SHARES, TO BE DISTRIBUTED PRO
RATA BY THE FORTIS FUND TO THE HOLDERS OF ITS SHARES, IN COMPLETE
LIQUIDATION OF THE FORTIS FUND.
2. TO TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENT THEREOF.
Dated: December , 2001 By Order of the Board of Directors,
/s/ MICHAEL J. RADMER
--------------------------------------
Michael J. Radmer
Secretary
Shareholders of record at the close of business on December 11, 2001 are
entitled to vote at the meeting. Whether or not you plan to attend the meeting,
please vote your shares by returning the proxy card by mail, or by voting by
telephone or the internet. Your vote is important.
TO SECURE THE LARGEST POSSIBLE REPRESENTATION AND TO SAVE THE EXPENSE OF FURTHER
MAILINGS, PLEASE MARK YOUR PROXY CARD, SIGN IT, AND RETURN IT IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. YOU MAY ALSO
VOTE BY TELEPHONE OR THE INTERNET. YOU MAY REVOKE YOUR PROXY AT ANY TIME AT OR
BEFORE THE MEETING OR VOTE IN PERSON IF YOU ATTEND THE MEETING.
THE HARTFORD ADVISERS FUND
THE HARTFORD GLOBAL LEADERS FUND
THE HARTFORD GROWTH AND INCOME FUND
THE HARTFORD HIGH YIELD FUND
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND
THE HARTFORD MONEY MARKET FUND
(EACH A SERIES OF THE HARTFORD MUTUAL FUNDS, INC.)
500 BIELENBERG DRIVE
WOODBURY, MINNESOTA 55125
1-888-843-7824
TO ACQUIRE THE ASSETS OF:
FORTIS ASSET ALLOCATION PORTFOLIO
FORTIS GLOBAL GROWTH PORTFOLIO
FORTIS GROWTH & INCOME FUND
FORTIS HIGH YIELD PORTFOLIO
FORTIS INTERNATIONAL EQUITY PORTFOLIO
FORTIS MONEY FUND
(EACH A SERIES OF HARTFORD-FORTIS SERIES FUND, INC.)
500 BIELENBERG DRIVE
WOODBURY, MINNESOTA 55125
1-800-800-2000, EXTENSION 3012
PROSPECTUS/PROXY STATEMENT
DECEMBER , 2001
This Prospectus/Proxy Statement describes a proposed Agreement and Plan of
Reorganization (the "Plan") pursuant to which you would receive shares of a
mutual fund in the Hartford family of funds (each a "Hartford Fund") in exchange
for the shares of the Fund you currently own (each a "Fortis Fund"). Each
Hartford Fund and each Fortis Fund is a diversified portfolio of securities of
an open-end management investment company. If the Plan is approved with respect
to your Fortis Fund, a Hartford Fund with substantially similar investment
objectives and substantially identical investment policies and strategies would
acquire all of the assets of your Fortis Fund, and Hartford Fund shares would be
distributed pro rata by the Fortis Fund to the holders of its shares, in
complete liquidation of the Fortis Fund. As a result of the Plan, each Fortis
Fund shareholder would become the owner of Hartford Fund shares of the same or a
similar class and having a total net asset value equal to the total net asset
value of such shareholder's holdings in the Fortis Fund. For the name of the
Hartford Fund into which your Fortis Fund would be reorganized, see
"Summary -- About the Proposed Reorganization." For a comparison of the
investment objectives of the Fortis Funds and the Hartford Funds and a summary
of their investment policies and strategies, see "Summary -- Comparison of
Investment Objectives, Policies, Strategies and Principal Risks of the Fortis
Funds and Hartford Funds."
THE BOARD OF DIRECTORS OF THE FORTIS FUNDS UNANIMOUSLY RECOMMENDS APPROVAL
OF THE PLAN.
You should retain this Prospectus/Proxy Statement for future reference. It
sets forth concisely the information about each Hartford Fund that a prospective
investor should know before investing. This Prospectus/Proxy Statement is
accompanied by the Prospectus of the Hartford Fund into which your Fortis Fund
would be reorganized, which is incorporated herein by reference. Statements of
Additional Information for each Hartford Fund (one relating to the Hartford
Fund's Prospectus and a second one relating to this Prospectus/Proxy Statement),
all containing additional information, have been filed with the Securities and
Exchange Commission and are incorporated herein by reference. Copies of the
Statements of Additional Information may be obtained without charge by writing
or calling the Hartford Funds at the address and telephone number shown above.
This Prospectus/Proxy Statement was first mailed to shareholders the week
of December , 2001.
THE SHARES OFFERED BY THIS PROSPECTUS/PROXY STATEMENT ARE NOT DEPOSITS OR
OBLIGATIONS OF ANY BANK, ARE NOT ENDORSED OR GUARANTEED BY ANY BANK, AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD,
OR ANY OTHER GOVERNMENT AGENCY. INVESTMENT IN THESE SHARES INVOLVES INVESTMENT
RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES, OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS/PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
----
SUMMARY..................................................... 1
About the Proposed Reorganization......................... 1
Comparative Fee Tables.................................... 2
COMPARISON OF INVESTMENT OBJECTIVES, POLICIES, STRATEGIES
AND PRINCIPAL RISKS OF THE FORTIS FUNDS AND HARTFORD
FUNDS..................................................... 13
Fortis Asset Allocation Portfolio / The Hartford Advisers
Fund................................................... 13
Fortis Global Growth Portfolio / The Hartford Global
Leaders Fund........................................... 14
Fortis Growth & Income Fund / The Hartford Growth and
Income Fund............................................ 15
Fortis High Yield Portfolio / The Hartford High Yield
Fund................................................... 16
Fortis International Equity Portfolio / The Hartford
International Opportunities Fund....................... 17
Fortis Money Fund / The Hartford Money Market Fund........ 17
COMPARISON OF POTENTIAL RISKS AND REWARDS: PERFORMANCE
INFORMATION............................................... 19
Risk/Return Bar Charts.................................... 19
Average Annual Total Return Tables........................ 26
COMPARISON OF OPERATIONS.................................... 30
Investment Advisory Agreements............................ 30
Other Service Providers................................... 30
Sales Load, Distribution and Shareholder Servicing
Arrangements........................................... 31
Purchase, Exchange and Redemption Procedures.............. 33
Dividends and Other Distributions......................... 35
Tax Consequences.......................................... 35
INFORMATION ABOUT THE REORGANIZATION........................ 35
Considerations by the Board of Directors of the Fortis
Funds.................................................. 35
Description of the Plan of Reorganization................. 37
Description of Hartford Fund Shares....................... 38
Federal Income Tax Consequences........................... 38
Comparative Information on Shareholder Rights and
Obligations............................................ 39
CAPITALIZATION.............................................. 40
INFORMATION ABOUT THE HARTFORD FUNDS AND THE FORTIS FUNDS... 43
Hartford Funds............................................ 43
Fortis Funds.............................................. 43
VOTING INFORMATION.......................................... 44
Outstanding Shares and Voting Requirements................ 45
Other Matters............................................. 51
Board Recommendation...................................... 51
FORM OF AGREEMENT AND PLAN OF REORGANIZATION -- APPENDIX
A......................................................... A-1
HARTFORD FUND PORTFOLIO MANAGER DISCUSSIONS -- APPENDIX B... B-1
HARTFORD FUND FINANCIAL HIGHLIGHTS -- APPENDIX C............ C-1
</Table>
i
SUMMARY
This summary is qualified in its entirety by reference to the additional
information contained elsewhere in this Prospectus/Proxy Statement, the
Prospectus and Statement of Additional Information of each Hartford Fund, the
Prospectus and Statement of Additional Information of each Fortis Fund, and the
Plan, a form of which is attached to this Prospectus/Proxy Statement as Appendix
A.
ABOUT THE PROPOSED REORGANIZATION
The Board of Directors of the corporation of which each Fortis Fund is a
series has voted to recommend approval of the Plan to shareholders of each
Fortis Fund. Under the Plan, each Hartford Fund would acquire all of the assets
of the corresponding Fortis Fund in exchange for the Hartford Fund's shares to
be distributed pro rata by the Fortis Fund to its shareholders in complete
liquidation and dissolution of the Fortis Fund (the "Reorganization"). As a
result of the Reorganization, each shareholder of a Fortis Fund will become the
owner of a Hartford Fund's shares of the same or a similar class having a total
net asset value equal to the total net asset value of such shareholder's
holdings in the Fortis Fund on the date of the Reorganization.
As a condition to the Reorganization, the Hartford Fund and the Fortis Fund
will receive an opinion of counsel that the Reorganization will be considered a
tax-free "reorganization" under applicable provisions of the Internal Revenue
Code of 1986, as amended (the "Code"), so that neither the Hartford Fund nor the
Fortis Fund nor the shareholders of the Fortis Fund will recognize any gain or
loss. The tax basis of the Hartford Fund's shares received by Fortis Fund
shareholders will be the same as the tax basis of their shares in the Fortis
Fund.
The following chart shows the Hartford Fund into which each Fortis Fund
would be reorganized if the Reorganization is approved and the Hartford Fund
share class that Fortis Fund shareholders of each class would receive. The chart
is arranged alphabetically according to the name of the Fortis Fund.
<Table>
<Caption>
FORTIS FUND/SHARE CLASS CORRESPONDING HARTFORD FUND/SHARE CLASS
- ----------------------- ---------------------------------------
Fortis Asset Allocation Portfolio The Hartford Advisers Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
Class Z Class A
Fortis Global Growth Portfolio The Hartford Global Leaders Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
Fortis Growth & Income Fund The Hartford Growth and Income Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
Fortis High Yield Portfolio The Hartford High Yield Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
</Table>
1
<Table>
<Caption>
FORTIS FUND/SHARE CLASS CORRESPONDING HARTFORD FUND/SHARE CLASS
- ----------------------- ---------------------------------------
Fortis International Equity Portfolio The Hartford International Opportunities Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
Fortis Money Fund The Hartford Money Market Fund
Class A Class A
Class B Class B
Class H Class B
Class C Class C
</Table>
COMPARATIVE FEE TABLES
The Fortis Funds, like all mutual funds, incur certain expenses in their
operations and as a shareholder of a Fortis Fund, you pay these expenses
indirectly. The expenses include management fees, Rule 12b-1 distribution and
service fees, as well as the costs of maintaining accounts, administration, and
other activities. The Hartford Funds incur similar expenses in their operations.
The following tables compare the expenses paid by the Fortis Funds with the
expenses that you will incur indirectly as a shareholder of the Hartford Fund
into which your shares will be exchanged. The tables also include any
shareholder fees that are paid directly from your investment. YOU WILL NOT BE
CHARGED ANY SALES LOADS FOR ACQUIRING SHARES OF THE HARTFORD FUND IN EXCHANGE
FOR SHARES OF THE FORTIS FUND YOU CURRENTLY OWN. IN ADDITION, YOU WILL RECEIVE
CREDIT FOR THE PERIOD YOU HELD YOUR FORTIS FUND SHARES IN DETERMINING ANY
CONTINGENT DEFERRED SALES CHARGE DUE UPON THE REDEMPTION OF THE HARTFORD FUND
SHARES YOU RECEIVE IN THE EXCHANGE. Each table (a) compares the fees and
expenses as of October 31, 2001 for a Fortis Fund and its corresponding Hartford
Fund and (b) shows the estimated fees and expenses for the corresponding
Hartford Fund on a pro forma basis as of that date after giving effect to the
Reorganization. Transfer agent fees have been restated to reflect contractual
fees currently in effect. Fee and expense tables that appear in the accompanying
Hartford Fund prospectus are based on fees and expenses as of October 31, 2000
and do not reflect current transfer agency fees. For this reason, the following
fee and expense tables and examples supplement and, to the extent inconsistent,
replace the fee and expense tables and examples in that prospectus.
2
THE HARTFORD ADVISERS FUND / FORTIS ASSET ALLOCATION PORTFOLIO
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS Z(1) CLASS A(1) CLASS B CLASS B/H CLASS B
-------- --------- ------------ ---------- --------- ----------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your Investment
Maximum Sales Charge (Load) on Purchases
(as a percentage of offering price).... 5.50% 4.75% None 5.50% None None None
Maximum Deferred Sales Charge (Load) (as
a percentage of original purchase price
or redemption proceeds, whichever is
less).................................. None None None None 5.00% 4.00% 5.00%
ANNUAL FUND OPERATING EXPENSES (Before
Waivers)
Expenses That Are Deducted From Fund
Assets (as a percentage of average net
assets)
Management Fees.......................... 0.65% 0.87% 0.87% 0.64% 0.65% 0.87% 0.64%
Distribution and/or Service (12b-1)
Fees................................... 0.35% 0.45% None 0.35% 1.00% 1.00% 1.00%
Other Expenses........................... 0.32% 0.08% 0.08% 0.32% 0.33% 0.08% 0.33%
Fund Accounting Fees................... 0.02% -- -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees.................... 0.27% -- -- 0.27% 0.28% -- 0.28%
Other.................................. 0.03% 0.08% 0.08% 0.03% 0.03% 0.08% 0.03%
Total Annual Fund Operating Expenses..... 1.32% 1.40% 0.95% 1.31% 1.98% 1.95% 1.97%
Contractual Waiver....................... 0.05% -- -- 0.05% -- -- --
Net Annual Fund Operating Expenses(2).... 1.27% 1.40% 0.95% 1.26% 1.98% 1.95% 1.97%
<Caption>
HARTFORD
HARTFORD FORTIS PRO FORMA
CLASS C CLASS C CLASS C
--------- --------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your Investment
Maximum Sales Charge (Load) on Purchases
(as a percentage of offering price).... 1.00% None 1.00%
Maximum Deferred Sales Charge (Load) (as
a percentage of original purchase price
or redemption proceeds, whichever is
less).................................. 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING EXPENSES (Before
Waivers)
Expenses That Are Deducted From Fund
Assets (as a percentage of average net
assets)
Management Fees.......................... 0.65% 0.87% 0.65%
Distribution and/or Service (12b-1)
Fees................................... 1.00% 1.00% 1.00%
Other Expenses........................... 0.25% 0.08% 0.25%
Fund Accounting Fees................... 0.02% -- 0.02%
Transfer Agent Fees.................... 0.19% -- 0.19%
Other.................................. 0.04% 0.08% 0.04%
Total Annual Fund Operating Expenses..... 1.90% 1.95% 1.90%
Contractual Waiver....................... -- -- --
Net Annual Fund Operating Expenses(2).... 1.90% 1.95% 1.90%
</Table>
- ---------------
(1) Fortis Fund Class Z shares will be exchanged for Hartford Fund Class A
shares and therefore will be subject to Rule 12b-1 distribution and service
fees of 0.35%, as noted above.
(2) Although the Rule 12b-1 fee for The Hartford Advisers Fund Class A shares is
0.35% of average net assets, the Fund's distributor has contractually agreed
to reduce the fee to 0.30% through at least February 28, 2003. This waiver
may be discontinued at any time thereafter.
3
THE HARTFORD GLOBAL LEADERS FUND / FORTIS GLOBAL GROWTH PORTFOLIO
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B
--------- --------- ---------- --------- ----------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your Investment
Maximum Sales Charge (Load) on Purchases (as a
percentage of offering price).................. 5.50% 4.75% 5.50% None None None
Maximum Deferred Sales Charge (Load) (as a
percentage of original purchase price or
redemption proceeds, whichever is less)........ None None None 5.00% 4.00% 5.00%
ANNUAL FUND OPERATING EXPENSES (Before Waivers)
Expenses That Are Deducted From Fund Assets (as a
percentage of average net assets)
Management Fees.................................. 0.85% 1.00% 0.82% 0.85% 1.00% 0.82%
Distribution and/or Service (12b-1) Fees......... 0.35% 0.25% 0.35% 1.00% 1.00% 1.00%
Other Expenses................................... 0.36% 0.14% 0.35% 0.38% 0.16% 0.36%
Fund Accounting Fees........................... 0.02% -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees............................ 0.27% -- 0.27% 0.28% -- 0.28%
Other.......................................... 0.07% 0.14% 0.06% 0.08% 0.16% 0.06%
Total Annual Fund Operating Expenses............. 1.56% 1.41% 1.52% 2.23% 2.16% 2.18%
Contractual Waiver............................... 0.05% -- 0.05% -- -- --
Net Annual Fund Operating Expenses(1)............ 1.51% 1.41% 1.47% 2.23% 2.16% 2.18%
<Caption>
HARTFORD
HARTFORD FORTIS PRO FORMA
CLASS C CLASS C CLASS C
--------- --------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your Investment
Maximum Sales Charge (Load) on Purchases (as a
percentage of offering price).................. 1.00% None 1.00%
Maximum Deferred Sales Charge (Load) (as a
percentage of original purchase price or
redemption proceeds, whichever is less)........ 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING EXPENSES (Before Waivers)
Expenses That Are Deducted From Fund Assets (as a
percentage of average net assets)
Management Fees.................................. 0.85% 1.00% 0.85%
Distribution and/or Service (12b-1) Fees......... 1.00% 1.00% 1.00%
Other Expenses................................... 0.28% 0.16% 0.28%
Fund Accounting Fees........................... 0.02% -- 0.02%
Transfer Agent Fees............................ 0.19% -- 0.19%
Other.......................................... 0.07% 0.16% 0.07%
Total Annual Fund Operating Expenses............. 2.13% 2.16% 2.13%
Contractual Waiver............................... -- -- --
Net Annual Fund Operating Expenses(1)............ 2.13% 2.16% 2.13%
</Table>
- ---------------
(1) Although the Rule 12b-1 fee for The Hartford Global Leaders Fund Class A
shares is 0.35% of average net assets, the Fund's distributor has
contractually agreed to reduce the fee to 0.30% through at least February
28, 2003. This waiver may be discontinued at any time thereafter.
4
THE HARTFORD GROWTH AND INCOME FUND / FORTIS GROWTH AND INCOME FUND
<Table>
<Caption>
HARTFORD HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C CLASS C CLASS C
-------- ------- --------- -------- --------- --------- -------- ------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your
Investment
Maximum Sales Charge (Load)
on Purchases (as a
percentage of offering
price)..................... 5.50% 4.75% 5.50% None None None 1.00% None 1.00%
Maximum Deferred Sales Charge
(Load) (as a percentage of
original purchase price or
redemption proceeds,
whichever is less)......... None None None 5.00% 4.00% 5.00% 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING
EXPENSES (Before Waivers)
Expenses That Are Deducted
From Fund Assets (as a
percentage of average net
assets)
Management Fees.............. 0.80% 1.00% 0.80% 0.80% 1.00% 0.80% 0.80% 1.00% 0.80%
Distribution and/or Service
(12b-1) Fees............... 0.35% 0.25% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Other Expenses............... 0.33% 0.21% 0.34% 0.34% 0.21% 0.34% 0.25% 0.21% 0.25%
Fund Accounting Fees....... 0.02% -- 0.02% 0.02% -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees........ 0.27% -- 0.27% 0.28% -- 0.28% 0.19% -- 0.19%
Other...................... 0.04% 0.21% 0.05% 0.04% 0.21% 0.04% 0.04% 0.21% 0.04%
Total Annual Fund Operating
Expenses................... 1.48% 1.46% 1.49% 2.14% 2.21% 2.14% 2.05% 2.21% 2.05%
Contractual Waiver........... 0.05% -- 0.05% -- -- -- -- -- --
Net Annual Fund Operating
Expenses(1)................ 1.43% 1.46% 1.44% 2.14% 2.21% 2.14% 2.05% 2.21% 2.05%
</Table>
- ---------------
(1) Although the Rule 12b-1 fee for The Hartford Growth and Income Fund Class A
shares is 0.35% of average net assets, the Fund's distributor has
contractually agreed to reduce the fee to 0.30% through at least February
28, 2003. This waiver may be discontinued at any time thereafter.
5
THE HARTFORD HIGH YIELD FUND / FORTIS HIGH YIELD PORTFOLIO
<Table>
<Caption>
HARTFORD HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C CLASS C CLASS C
-------- ------- --------- -------- --------- --------- -------- ------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your
Investment
Maximum Sales Charge (Load)
on Purchases (as a
percentage of offering
price)..................... 4.50% 4.50% 4.50% None None None 1.00% None 1.00%
Maximum Deferred Sales Charge
(Load) (as a percentage of
original purchase price or
redemption proceeds,
whichever is less)......... None None None 5.00% 4.00% 5.00% 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING
EXPENSES (Before Waivers)
Expenses That Are Deducted
From Fund Assets (as a
percentage of average net
assets)
Management Fees.............. 0.75% 0.74% 0.75% 0.75% 0.74% 0.75% 0.75% 0.74% 0.75%
Distribution and/or Service
(12b-1) Fees............... 0.35% 0.35% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Other Expenses............... 0.34% 0.09% 0.33% 0.36% 0.09% 0.34% 0.29% 0.09% 0.27%
Fund Accounting Fees....... 0.02% -- 0.02% 0.02% -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees........ 0.27% -- 0.27% 0.28% -- 0.28% 0.19% -- 0.19%
Other...................... 0.05% 0.09% 0.04% 0.06% 0.09% 0.04% 0.08% 0.09% 0.06%
Total Annual Fund Operating
Expenses................... 1.44% 1.18% 1.43% 2.11% 1.83% 2.09% 2.04% 1.83% 2.02%
Contractual Waiver........... 0.05% -- 0.05% -- -- -- -- -- --
Net Annual Fund Operating
Expenses(1)................ 1.39% 1.18% 1.38% 2.11% 1.83% 2.09% 2.04% 1.83% 2.02%
</Table>
- ---------------
(1) Although the Rule 12b-1 fee for The Hartford High Yield Fund Class A shares
is 0.35% of average net assets, the Fund's distributor has contractually
agreed to reduce the fee to 0.30% through at least February 28, 2003. This
waiver may be discontinued at any time thereafter.
6
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND / FORTIS INTERNATIONAL EQUITY
PORTFOLIO
<Table>
<Caption>
HARTFORD HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C CLASS C CLASS C
-------- ------- --------- -------- --------- --------- -------- ------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your
Investment
Maximum Sales Charge (Load)
on Purchases (as a
percentage of offering
price)..................... 5.50% 4.75% 5.50% None None None 1.00% None 1.00%
Maximum Deferred Sales Charge
(Load) (as a percentage of
original purchase price or
redemption proceeds,
whichever is less)......... None None None 5.00% 4.00% 5.00% 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING
EXPENSES (Before Waivers)
Expenses That Are Deducted
From Fund Assets (as a
percentage of average net
assets)
Management Fees.............. 0.85% 1.00% 0.85% 0.85% 1.00% 0.85% 0.85% 1.00% 0.85%
Distribution and/or Service
(12b-1) Fees............... 0.35% 0.25% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Other Expenses............... 0.44% 0.43% 0.42% 0.44% 0.43% 0.43% 0.36% 0.43% 0.35%
Fund Accounting Fees....... 0.02% -- 0.02% 0.02% -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees........ 0.27% -- 0.27% 0.28% -- 0.28% 0.19% -- 0.19%
Other...................... 0.15% 0.43% 0.13% 0.14% 0.43% 0.13% 0.15% 0.43% 0.14%
Total Annual Fund Operating
Expenses................... 1.64% 1.68% 1.62% 2.29% 2.43% 2.28% 2.21% 2.43% 2.20%
Contractual Waiver........... 0.05% -- 0.05% -- -- -- -- -- --
Net Annual Fund Operating
Expenses(1)................ 1.59% 1.68% 1.57% 2.29% 2.43% 2.28% 2.21% 2.43% 2.20%
</Table>
- ---------------
(1) Although the Rule 12b-1 fee for The Hartford International Opportunities
Fund Class A shares is 0.35% of average net assets, the Fund's distributor
has contractually agreed to reduce the fee to 0.30% through at least
February 28, 2003. This waiver may be discontinued at any time thereafter.
7
THE HARTFORD MONEY MARKET FUND / FORTIS MONEY FUND
<Table>
<Caption>
HARTFORD HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C CLASS C CLASS C
-------- ------- --------- -------- --------- --------- -------- ------- ---------
SHAREHOLDER FEES
Fees Paid Directly From Your
Investment
Maximum Sales Charge (Load)
on Purchases (as a
percentage of offering
price)..................... None None None None None None 1.00% None 1.00%
Maximum Deferred Sales Charge
(Load) (as a percentage of
original purchase price or
redemption proceeds,
whichever is less)......... None None None 5.00% 4.00% 5.00% 1.00% 1.00% 1.00%
ANNUAL FUND OPERATING
EXPENSES (Before Waivers)
Expenses That Are Deducted
From Fund Assets (as a
percentage of average net
assets)
Management Fees.............. 0.50% 0.40% 0.50% 0.50% 0.40% 0.50% 0.50% 0.40% 0.50%
Distribution and/or Service
(12b-1) Fees............... 0.35% 0.20% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Other Expenses............... 0.34% 0.19% 0.34% 0.36% 0.19% 0.36% 0.28% 0.19% 0.28%
Fund Accounting Fees....... 0.02% -- 0.02% 0.02% -- 0.02% 0.02% -- 0.02%
Transfer Agent Fees........ 0.27% 0.09% 0.27% 0.28% 0.09% 0.28% 0.19% 0.09% 0.19%
Other...................... 0.05% 0.10% 0.05% 0.06% 0.10% 0.06% 0.07% 0.10% 0.07%
Total Annual Fund Operating
Expenses................... 1.19% 0.79% 1.19% 1.86% 1.59% 1.86% 1.78% 1.59% 1.78%
Contractual Waiver........... 0.19% -- 0.19% 0.16% -- 0.16% 0.08% -- 0.08%
Net Annual Fund Operating
Expenses(1)................ 1.00% 0.79% 1.00% 1.70% 1.59% 1.70% 1.70% 1.59% 1.70%
</Table>
- ---------------
(1) Although the Rule 12b-1 fee for The Hartford Money Market Fund Class A
shares is 0.35% of average net assets, the Fund's distributor has
contractually agreed to reduce the fee to 0.30% through at least February
28, 2003. In addition, HIFSCO has contractually agreed to limit the total
operating expenses of the Class A, Class B and Class C shares of The
Hartford Money Market Fund, exclusive of taxes, interest, brokerage
commissions and extraordinary expenses, to 1.00%, 1.70% and 1.70%,
respectively, through at least February 28, 2003. These waivers may be
discontinued at any time thereafter.
8
EXAMPLES
The following Examples are intended to help you compare the cost of
investing in the Fortis Fund whose shares you currently own with the cost of
investing in the Hartford Fund into which your Fortis Fund will be reorganized
if the proposed Reorganization is approved. The Examples are based on the
expense tables above, without taking into account any contractual waivers.
The Examples assume that you invest $10,000 in each Fund for the time
periods indicated and either (i) redeem all of your shares at the end of those
periods or (ii) do not redeem your shares. Each Example assumes that your
investment has a 5% return each year, that the Fund's operating expenses remain
the same and that you reinvest all dividends and distributions. Although your
actual costs may be higher or lower, based on these assumptions your costs would
be:
THE HARTFORD ADVISERS FUND/FORTIS ASSET ALLOCATION PORTFOLIO
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS Z CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- ------- --------- -------- --------- --------- --------
1 year..................... $ 677 $ 611 $ 97 $ 676 $ 701 $ 558 $ 700 $ 391
3 years.................... $ 945 $ 897 $ 303 $ 942 $ 921 $ 882 $ 918 $ 691
5 years.................... $1,234 $1,204 $ 525 $1,229 $1,268 $1,232 $1,262 $1,116
10 years................... $2,053 $2,075 $1,166 $2,042 $2,136 $2,133 $2,125 $2,300
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year..................... $ 298 $ 391
3 years.................... $ 612 $ 691
5 years.................... $1,052 $1,116
10 years................... $2,275 $2,300
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS Z CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- ------- --------- -------- --------- --------- --------
1 year..................... $ 677 $ 611 $ 97 $ 676 $ 201 $ 198 $ 200 $ 291
3 years.................... $ 945 $ 897 $ 303 $ 942 $ 621 $ 612 $ 618 $ 691
5 years.................... $1,234 $1,204 $ 525 $1,229 $1,068 $1,052 $1,062 $1,116
10 years................... $2,053 $2,075 $1,166 $2,042 $2,136 $2,133 $2,125 $2,300
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year..................... $ 198 $ 291
3 years.................... $ 612 $ 691
5 years.................... $1,052 $1,116
10 years................... $2,275 $2,300
</Table>
9
THE HARTFORD GLOBAL LEADERS FUND/FORTIS GLOBAL GROWTH PORTFOLIO
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 700 $ 612 $ 696 $ 726 $ 579 $ 721 $ 414
3 years.............................. $1,016 $ 900 $1,004 $ 997 $ 946 $ 982 $ 760
5 years.............................. $1,353 $1,209 $1,333 $1,395 $1,339 $1,370 $1,233
10 years............................. $2,304 $2,086 $2,263 $2,388 $2,303 $2,339 $2,537
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 319 $ 414
3 years.............................. $ 676 $ 760
5 years.............................. $1,159 $1,233
10 years............................. $2,493 $2,537
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 700 $ 612 $ 696 $ 226 $ 219 $ 221 $ 314
3 years.............................. $1,016 $ 900 $1,004 $ 697 $ 676 $ 682 $ 760
5 years.............................. $1,353 $1,209 $1,333 $1,195 $1,159 $1,170 $1,233
10 years............................. $2,304 $2,086 $2,263 $2,388 $2,303 $2,339 $2,537
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 219 $ 314
3 years.............................. $ 676 $ 760
5 years.............................. $1,159 $1,233
10 years............................. $2,493 $2,537
</Table>
THE HARTFORD GROWTH AND INCOME FUND/FORTIS GROWTH & INCOME FUND
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 692 $ 619 $ 693 $ 717 $ 584 $ 717 $ 406
3 years.............................. $ 992 $ 915 $ 995 $ 970 $ 961 $ 970 $ 736
5 years.............................. $1,314 $1,235 $1,318 $1,349 $1,365 $1,349 $1,192
10 years............................. $2,221 $2,138 $2,232 $2,305 $2,355 $2,305 $2,455
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 324 $ 406
3 years.............................. $ 691 $ 736
5 years.............................. $1,185 $1,192
10 years............................. $2,544 $2,455
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 692 $ 619 $ 693 $ 217 $ 224 $ 217 $ 306
3 years.............................. $ 992 $ 915 $ 995 $ 670 $ 691 $ 670 $ 736
5 years.............................. $1,314 $1,235 $1,318 $1,149 $1,185 $1,149 $1,192
10 years............................. $2,221 $2,138 $2,232 $2,305 $2,355 $2,305 $2,455
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 224 $ 306
3 years.............................. $ 691 $ 736
5 years.............................. $1,185 $1,192
10 years............................. $2,544 $2,455
</Table>
10
THE HARTFORD HIGH YIELD FUND/FORTIS HIGH YIELD PORTFOLIO
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 590 $ 565 $ 589 $ 714 $ 546 $ 712 $ 405
3 years.............................. $ 885 $ 808 $ 882 $ 961 $ 846 $ 955 $ 733
5 years.............................. $1,201 $1,070 $1,196 $1,334 $1,170 $1,324 $1,187
10 years............................. $2,097 $1,817 $2,086 $2,271 $1,978 $2,252 $2,445
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 286 $ 403
3 years.............................. $ 576 $ 727
5 years.............................. $ 990 $1,177
10 years............................. $2,148 $2,425
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 590 $ 565 $ 589 $ 214 $ 186 $ 212 $ 305
3 years.............................. $ 885 $ 808 $ 882 $ 661 $ 576 $ 655 $ 733
5 years.............................. $1,201 $1,070 $1,196 $1,134 $ 990 $1,124 $1,187
10 years............................. $2,097 $1,817 $2,086 $2,271 $1,978 $2,252 $2,445
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 186 $ 303
3 years.............................. $ 576 $ 727
5 years.............................. $ 990 $1,177
10 years............................. $2,148 $2,425
</Table>
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND/FORTIS INTERNATIONAL EQUITY
PORTFOLIO
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 708 $ 638 $ 706 $ 732 $ 606 $ 731 $ 422
3 years.............................. $1,039 $ 979 $1,033 $1,015 $1,028 $1,012 $ 784
5 years.............................. $1,393 $1,344 $1,383 $1,425 $1,476 $1,420 $1,273
10 years............................. $2,387 $2,368 $2,366 $2,463 $2,581 $2,450 $2,619
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 346 $ 421
3 years.............................. $ 758 $ 781
5 years.............................. $1,296 $1,268
10 years............................. $2,766 $2,609
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 708 $ 638 $ 706 $ 232 $ 246 $ 231 $ 322
3 years.............................. $1,039 $ 979 $1,033 $ 715 $ 758 $ 712 $ 784
5 years.............................. $1,393 $1,344 $1,383 $1,225 $1,296 $1,220 $1,273
10 years............................. $2,387 $2,368 $2,366 $2,463 $2,581 $2,450 $2,619
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 246 $ 321
3 years.............................. $ 758 $ 781
5 years.............................. $1,296 $1,268
10 years............................. $2,766 $2,609
</Table>
11
THE HARTFORD MONEY MARKET FUND/FORTIS MONEY FUND
With redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 121 $ 81 $ 121 $ 689 $ 522 $ 689 $ 379
3 years.............................. $ 378 $ 252 $ 378 $ 885 $ 772 $ 885 $ 655
5 years.............................. $ 654 $ 439 $ 654 $1,206 $1,046 $1,206 $1,055
10 years............................. $1,443 $ 978 $1,443 $2,068 $1,674 $2,068 $2,174
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 262 $ 379
3 years.............................. $ 502 $ 655
5 years.............................. $ 866 $1,055
10 years............................. $1,889 $2,174
</Table>
Without redemption
<Table>
<Caption>
HARTFORD HARTFORD
HARTFORD FORTIS PRO FORMA HARTFORD FORTIS PRO FORMA HARTFORD
CLASS A CLASS A CLASS A CLASS B CLASS B/H CLASS B CLASS C
-------- ------- --------- -------- --------- --------- --------
1 year............................... $ 121 $ 81 $ 121 $ 189 $ 162 $ 189 $ 279
3 years.............................. $ 378 $ 252 $ 378 $ 585 $ 502 $ 585 $ 655
5 years.............................. $ 654 $ 439 $ 654 $1,006 $ 866 $1,006 $1,055
10 years............................. $1,443 $ 978 $1,443 $2,068 $1,674 $2,068 $2,174
<Caption>
HARTFORD
FORTIS PRO FORMA
CLASS C CLASS C
------- ---------
1 year............................... $ 162 $ 279
3 years.............................. $ 502 $ 655
5 years.............................. $ 866 $1,055
10 years............................. $1,889 $2,174
</Table>
12
COMPARISON OF INVESTMENT OBJECTIVES, POLICIES, STRATEGIES AND PRINCIPAL RISKS OF
THE FORTIS FUNDS AND HARTFORD FUNDS
This section contains tables comparing the investment objectives of each
Fortis Fund and the Hartford Fund into which it would be reorganized. The
investment objectives of the Hartford Funds and the Fortis Funds (other than
Fortis Money Fund) may be changed without shareholder approval. The investment
policies and strategies and the principal risks of each Fortis Fund are
substantially identical to those of its corresponding Hartford Fund and are
summarized in the tables below. The tables are arranged alphabetically according
to the name of the Hartford Fund. In addition to the policies and strategies set
forth below, each Hartford Fund and each Fortis Fund is subject to certain
additional investment policies and limitations, described in their respective
Statements of Additional Information. Reference is hereby made to the Prospectus
and Statement of Additional Information of each Hartford Fund, and to the
Prospectus and Statement of Additional Information of each Fortis Fund, which
set forth in full the investment objectives, policies, strategies and
limitations of each Hartford Fund and each Fortis Fund, all of which are
incorporated herein by reference thereto.
FORTIS ASSET ALLOCATION PORTFOLIO / THE HARTFORD ADVISERS FUND
INVESTMENT OBJECTIVE -- FORTIS ASSET ALLOCATION PORTFOLIO
Maximizing total return on invested capital, mainly from capital appreciation,
dividends and interest.
INVESTMENT OBJECTIVE -- THE HARTFORD ADVISERS FUND
Maximum long-term total return.
INVESTMENT STRATEGY
Fortis Asset Allocation Portfolio and The Hartford Advisers Fund use the
same investment strategies. Each Fund allocates its assets among three
categories:
- stocks,
- debt securities, and
- money market instruments.
The Funds favor stocks issued by high-quality companies. The debt
securities (other than money market instruments) in which the Funds primarily
invest include securities issued or guaranteed by the U.S. Government and its
agencies or instrumentalities and securities rated investment grade (rated at
least BBB by Standard & Poor's Ratings Services or Baa by Moody's Investors
Service, Inc., or if unrated, securities deemed by the sub-adviser to be of
comparable quality). Neither Fund is restricted to any specific maturity term.
Each Fund may invest up to 20% of its total assets in securities of foreign
issuers and non-dollar securities.
PRINCIPAL RISKS
Fortis Asset Allocation Portfolio and The Hartford Advisers Fund are
subject to the same principal risks. Each Fund is subject to stock market risk,
interest rate risk, credit risk, income risk, call risk, prepayment and
extension risk, manager allocation risk and the risks of foreign investment.
Stock market risk means the stocks held by a Fund may decline in value due
to the activities and financial prospects of individual companies or to general
market and economic conditions.
Interest rate risk refers to the possibility that your investment may go
down in value when interest rates rise.
Income risk is the potential for a decline in a Fund's income due to
falling interest rates.
13
Each Fund is subject to the possibility that, under certain circumstances,
especially during periods of falling interest rates, a bond issuer will
"call" - or repay - its bonds before their maturity date. The Fund may then be
forced to invest the unanticipated proceeds at lower interest rates, resulting
in a decline in the Fund's income.
Because the Funds may invest significantly in mortgage-backed securities,
they are subject to prepayment risk and extension risk. Similar to call risk,
prepayment risk is the risk that falling interest rates could cause faster than
expected prepayments of the mortgages underlying a Fund's mortgage-backed
securities. These prepayments pass through to the Fund, which must reinvest them
at a time when interest rates on new mortgage-backed investments are falling,
reducing the Fund's income. Extension risk is the risk that the rising interest
rates could cause mortgage prepayments to slow, which could increase the
interest rate sensitivity of a Fund's mortgage-backed securities.
Credit risk refers to the possibility that the issuing company may not be
able to pay interest and principal when due.
Manager allocation risk refers to the possibility that the portfolio
managers could allocate assets in a manner that results in a Fund
underperforming its peers.
Foreign investments may be more risky than domestic investments.
Investments in foreign securities may be affected by fluctuations in currency
exchange rates, incomplete or inaccurate financial information on companies,
social upheavals and political actions ranging from tax code changes to
governmental collapse.
FORTIS GLOBAL GROWTH PORTFOLIO / THE HARTFORD GLOBAL LEADERS FUND
INVESTMENT OBJECTIVE -- FORTIS GLOBAL GROWTH PORTFOLIO
Long-term capital appreciation.
INVESTMENT OBJECTIVE -- THE HARTFORD GLOBAL LEADERS FUND
Growth of capital by investing in stocks issued by companies worldwide.
INVESTMENT STRATEGY
Fortis Global Growth Portfolio and The Hartford Global Leaders Fund use the
same investment strategies. Each Fund invests primarily in a diversified
portfolio of common stocks covering a broad range of countries, industries and
companies. Securities in which the Funds invest are denominated in both U.S.
dollars and foreign currencies and may trade in both U.S. and foreign markets.
Under normal market and economic conditions, each Fund invests at least 65%
of its total assets in common stock of high-quality growth companies worldwide.
Under normal market and economic conditions, each Fund will diversify its
investments in securities of issuers among at least five countries, which may
include the United States. There are no limits on the amount of a Fund's assets
that may be invested in each country.
In recent years, the Hartford Fund's annual portfolio turnover rate has
exceeded 200%. Although this has not been the case for the Fortis Fund, the
portfolio turnover rates for the two Funds are expected to be substantially
similar going forward since the Funds are now being managed by the same
sub-adviser using the same investment strategies.
PRINCIPAL RISKS
Fortis Global Growth Portfolio and The Hartford Global Leaders Fund are
subject to the same principal risks.
The value of each Fund may go down in response to overall stock market
movements and trends.
14
Foreign investments may be more risky than domestic investments.
Investments in foreign securities may be affected by fluctuations in currency
exchange rates, incomplete or inaccurate financial information on companies,
social upheavals and political actions ranging from tax code changes to
government collapse.
The Funds emphasize high-quality growth companies. If the sub-adviser
incorrectly assesses a company's prospects for growth, or if its judgment about
how other investors will value the company's growth is wrong, then the price of
the company's stock may decrease, or it may not increase to the level that the
sub-adviser had anticipated.
The Funds' management strategy will influence their performance
significantly. If a Fund invests in countries or regions that experience
economic downturns, its performance could suffer. Similarly, if certain
investments or industries don't perform as expected, or if the managers' stock
selection strategy doesn't perform as expected, a Fund could underperform its
peers or lose money.
Each Fund trades securities very actively, which increases its transaction
costs (thus affecting performance) and increases your taxable distributions.
FORTIS GROWTH & INCOME FUND / THE HARTFORD GROWTH AND INCOME FUND
INVESTMENT OBJECTIVE -- FORTIS GROWTH & INCOME FUND
Capital appreciation and current income.
INVESTMENT OBJECTIVE -- THE HARTFORD GROWTH AND INCOME FUND
Growth of capital and current income by investing primarily in stocks with
earnings growth potential and steady or rising dividends.
INVESTMENT STRATEGY
Fortis Growth & Income Fund and The Hartford Growth and Income Fund use the
same investment strategies. Each Fund invests primarily in a diversified
portfolio of common stocks that typically have steady or rising dividends and
whose prospects for capital appreciation are considered favorable by the Funds'
sub-adviser. Fortis Growth & Income Fund invests primarily in the common stocks
of large companies. Although The Hartford Growth and Income Fund does not list
investments in large companies as a principal strategy, the median market
capitalization of the companies in each Fund's portfolio are similar ($54.3
billion for Fortis Growth & Income Fund and $58.4 billion for The Hartford
Growth and Income Fund as of September 30, 2001). Each Fund may invest up to 20%
of its total assets in securities of foreign issuers and non-dollar securities.
PRINCIPAL RISKS
Fortis Growth & Income Fund and The Hartford Growth and Income Fund are
subject to the same principal risks.
The value of each Fund may go down in response to overall stock market
movements and trends.
Each Fund is subject to income risk, which is the potential that the yield
from the Fund's investments will not be sufficient to provide for the payment of
dividends from net investment income. During the fiscal year ended August 31,
2001, Fortis Growth & Income Fund did not pay any dividends from net investment
income, except on Class A shares. The Hartford Growth and Income Fund did not
pay any dividends from net investment income during the fiscal year ended
October 31, 2001.
Foreign investments may be more risky than domestic investments.
Investments in foreign securities may be affected by fluctuations in currency
exchange rates, incomplete or inaccurate financial information on companies,
social upheavals and political actions ranging from tax code changes to
government collapse.
The Funds' management strategy will influence their performance
significantly. Large-capitalization stocks as a group could fall out of favor
with the market, causing either Fund to underperform funds that
15
focus on small- or medium-capitalization stocks. If a Fund's stock selection
strategy doesn't perform as expected, the Fund could underperform its peers or
lose money.
FORTIS HIGH YIELD PORTFOLIO / THE HARTFORD HIGH YIELD FUND
INVESTMENT OBJECTIVE -- FORTIS HIGH YIELD PORTFOLIO
To maximize total return.
INVESTMENT OBJECTIVE -- THE HARTFORD HIGH YIELD FUND
To seek high current income by investing in non-investment grade debt
securities. Growth of capital is a secondary objective.
INVESTMENT STRATEGY
Fortis High Yield Portfolio and The Hartford High Yield Fund use the same
investment strategies. Each Fund normally invests at least 65% and may invest up
to 100% of its portfolio in non-investment grade securities (securities rated
"Ba" or lower by Moody's Investors Service, Inc. ("Moody's") or "BB" or lower by
Standard and Poor's Ratings Services ("S&P")), or securities which, if unrated,
are determined by the sub-adviser to be of comparable quality. Debt securities
rated below investment grade are commonly referred to as "high yield -- high
risk securities" or "junk bonds." Neither Fund will invest more than 10% of its
total assets in securities rated below B3 by Moody's or B- by S&P, or, if
unrated, determined to be of comparable quality by the sub-adviser. The Funds
may invest in bonds of any maturity, although each Fund tends to have an average
maturity within the intermediate-term range, which is typically defined as
between five to ten years.
Each Fund may invest up to 15% of its total assets in preferred stocks,
convertible securities, and securities carrying warrants to purchase equity
securities. The Funds will not invest in common stocks directly, but may retain,
for reasonable periods of time, common stocks acquired upon conversion of debt
securities or upon exercise of warrants acquired with debt securities. Each Fund
may invest up to 30% of its total assets in securities of foreign issuers and up
to 10% of its total assets in non-dollar securities.
PRINCIPAL RISKS
Fortis High Yield Portfolio and The Hartford High Yield Fund are subject to
the same principal risks.
The performance of each Fund will be affected by interest rates. When
interest rates rise, bond prices fall; generally the longer a bond's maturity,
the more sensitive it is to this risk.
Each fund is also subject to credit risk, which is the possibility that the
issuing company may not be able to pay interest and principal when due. In
general, lower-rated bonds have higher credit risk. High yield bond prices can
fall on bad news about the economy, an industry or a company. Share price, yield
and total return may fluctuate more than with less aggressive bond funds.
Either Fund could lose money if any bonds it owns are downgraded in credit
rating or go into default. If certain industries or investments don't perform as
a Fund expects, it could underperform its peers or lose money.
The Funds are subject to income risk, which is the potential for a decline
in a Fund's income due to falling interest rates.
Each Fund is subject to the possibility that, under certain circumstances,
especially during periods of falling interest rates, a bond issuer will "call" -
or repay - its bonds before their maturity date. The Fund may then be forced to
invest the unanticipated proceeds at lower interest rates, resulting in a
decline in the Fund's income.
16
Foreign investments may be more risky than domestic investments.
Investments in foreign securities may be affected by fluctuations in currency
exchange rates, incomplete or inaccurate financial information on companies,
social upheavals and political actions ranging from tax code changes to
government collapse.
High yield bonds and foreign securities may make the Funds more sensitive
to market or economic shifts in the U.S. and abroad.
FORTIS INTERNATIONAL EQUITY PORTFOLIO / THE HARTFORD INTERNATIONAL OPPORTUNITIES
FUND
INVESTMENT OBJECTIVE -- FORTIS INTERNATIONAL EQUITY PORTFOLIO
Long-term capital appreciation.
INVESTMENT OBJECTIVE -- THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND
Growth of capital by investing primarily in stocks issued by non-U.S. companies.
INVESTMENT STRATEGY
Fortis International Equity Portfolio and The Hartford International
Opportunities Fund use the same investment strategies. Each Fund normally
invests at least 65% of its assets in stocks issued by non-U.S. companies which
trade in foreign markets that are generally considered to be well established.
Under normal market conditions each Fund diversifies its investments among at
least three countries other than the United States. The securities in which the
Funds invest are denominated in both U.S. dollars and foreign currencies and
generally are traded in foreign markets.
PRINCIPAL RISKS
Fortis International Equity Portfolio and The Hartford International
Opportunities Fund are subject to the same principal risks. The value of each
Fund may go down in response to overall stock market movements and trends.
Foreign investments may be more risky than domestic investments. Investments in
foreign securities may be affected by fluctuations in currency exchange rates,
incomplete or inaccurate financial information on companies, social upheavals
and political actions ranging from tax code changes to government collapse.
The Funds' management strategy will influence their performance
significantly. If a Fund invests in countries or regions that experience
economic downturns, its performance could suffer. Similarly, if certain
investments or industries don't perform as expected, or if the sub-adviser's
stock selection strategy doesn't perform as expected, a Fund could underperform
its peers or lose money.
Each Fund may trade securities actively, which could increase its
transaction costs (thus affecting performance) and increase your taxable
distributions.
FORTIS MONEY FUND / THE HARTFORD MONEY MARKET FUND
INVESTMENT OBJECTIVE -- FORTIS MONEY FUND
To maximize current income to the extent consistent with stability of principal.
INVESTMENT OBJECTIVE -- THE HARTFORD MONEY MARKET FUND
Maximum current income consistent with liquidity and preservation of capital.
INVESTMENT STRATEGY
Fortis Money Fund and The Hartford Money Market Fund use the same
investment strategies. Each Fund seeks to maintain a stable share net asset
value of $1.00 per share. The Funds focus on specific short-term U.S. dollar
denominated money market instruments which are rated in the first two investment
tiers by at least one nationally recognized statistical rating organization, or
if unrated, are determined to be of comparable quality by the sub-adviser. Money
market instruments include (1) banker's acceptances; (2) obligations of
governments (whether U.S. or non-U.S.) and their agencies and instrumentalities;
(3) short-term corporate obligations, including commercial paper, notes and
bonds; (4) other short-term
17
debt obligations; (5) obligations of U.S. banks, non-U.S. branches of U.S. banks
(Eurodollars), U.S. branches and agencies of non-U.S. banks (Yankee dollars),
and non-U.S. branches of non-U.S. banks; (6) asset-backed securities; and (7)
repurchase agreements.
PRINCIPAL RISKS
Fortis Money Fund and The Hartford Money Market Fund are subject to the
same principal risks. The primary risks of these Funds are interest rate risk,
credit risk, income risk, inflation risk and manager risk.
A rise in interest rates could cause a fall in the value of a Fund's
securities.
Credit risk refers to the risk that a security's credit rating could be
downgraded affecting the value, and potentially the likelihood of repayment, of
a Fund's securities.
Income risk is the potential for a decline in a Fund's income due to
falling interest rates.
Inflation risk refers to the risk that, even if the principal value of an
investment in a Fund remains constant, or the income from the investment remains
constant or increases, their real value may be less in the future because of
inflation. Thus, as inflation occurs, the purchasing power of your Fund shares
may decline.
Manager risk refers to the risk that if the manager does not effectively
implement a Fund's investment goal and style, the Fund could underperform its
peers.
An investment in either Fortis Money Fund or The Hartford Money Market Fund
is not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. Although both Funds seek to preserve the value of your
investment at $1.00 per share, there is a risk that the share price of either
Fund could fall below $1.00, which would make your shares worth less than the
amount you paid for them.
18
COMPARISON OF POTENTIAL RISKS AND REWARDS: PERFORMANCE INFORMATION
The bar charts and tables below compare the potential risks and rewards of
investing in the Fortis Funds and the Hartford Funds. Each bar chart provides an
indication of the risks of investing in each Fund by showing changes in the
Fund's performance from year to year for the last ten years or since the Fund's
inception. The tables show how each Fund's average annual total returns for one
year, five years and ten years (or since inception) compare to the returns of a
broad-based market index. The figures assume reinvestment of dividends and
distributions.
Keep in mind that past performance does not indicate future results. The
performance for the Fortis Funds is for periods during which the Funds were
managed by Fortis Advisers, Inc. Each Fortis Fund now has the same investment
adviser, sub-adviser and portfolio managers as its corresponding Hartford Fund.
RISK/RETURN BAR CHARTS
The bar charts shown below show the variability of total returns on a
calendar year-end basis for each Fortis Fund and its corresponding Hartford
Fund. The charts are arranged alphabetically according to the name of the
Hartford Fund.
For both the Fortis Funds and the Hartford Funds, the total returns shown
in the bar charts are those of Class A shares. These shares generally are sold
subject to a sales charge (load), except in the case of Fortis Money Fund and
The Hartford Money Market Fund. However, total returns displayed in the bar
charts do not reflect the payment of any sales charges. If these charges had
been included, the returns shown would have been lower. Remember, you will not
be charged any sales charges in connection with the reorganization of your
Fortis Fund into its corresponding Hartford Fund.
19
THE HARTFORD ADVISERS FUND
NUMBERS ARE PERCENTAGES
<Table>
1997 23.30
1998 21.09
1999 12.08
2000 0.90
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -11.13%.
<Table>
BEST QUARTER: 12.39% (quarter ended 6/30/99)
WORST QUARTER: -4.09% (quarter ended 9/30/99)
</Table>
FORTIS ASSET ALLOCATION PORTFOLIO
NUMBERS ARE PERCENTAGES
<Table>
1991 29.34
1992 6.29
1993 11.27
1994 -0.82
1995 22.01
1996 12.03
1997 19.17
1998 19.3
1999 18.71
2000 -1.35
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -13.85%.
<Table>
BEST QUARTER: 17.96% (quarter ended 12/31/99)
WORST QUARTER: -7.45% (quarter ended 9/30/98)
</Table>
20
THE HARTFORD GLOBAL LEADERS FUND
NUMBERS ARE PERCENTAGES
<Table>
1999 47.68
2000 -7.26
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -26.42%.
<Table>
BEST QUARTER: 31.85% (quarter ended 12/31/99)
WORST QUARTER: -8.02% (quarter ended 12/31/00)
</Table>
FORTIS GLOBAL GROWTH PORTFOLIO
<Table>
1992 6.31
1993 19.51
1994 -4.29
1995 31.56
1996 18.37
1997 7.85
1998 10.16
1999 55.54
2000 -19.64
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -33.35%.
<Table>
BEST QUARTER: 40.05% (quarter ended 12/31/99)
WORST QUARTER: -20.69% (quarter ended 9/30/98)
</Table>
21
THE HARTFORD GROWTH AND INCOME FUND
<Table>
1999 20.80
2000 -6.49
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -17.91%.
<Table>
BEST QUARTER: 15.26% (quarter ended 12/31/99)
WORST QUARTER: -7.04% (quarter ended 12/31/00)
</Table>
FORTIS GROWTH & INCOME FUND
<Table>
1996 18.00
1997 22.90
1998 11.56
1999 10.70
2000 4.18
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -19.96%.
<Table>
BEST QUARTER: 14.06% (quarter ended 12/31/99)
WORST QUARTER: -9.15% (quarter ended 9/30/98)
</Table>
22
THE HARTFORD HIGH YIELD FUND
<Table>
1999 3.47
2000 0.62
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -3.04%.
<Table>
BEST QUARTER: 2.73% (quarter ended 3/31/99)
WORST QUARTER: -1.96% (quarter ended 3/31/00)
</Table>
FORTIS HIGH YIELD PORTFOLIO
<Table>
1991 56.46
1992 15.52
1993 21.82
1994 -3.49
1995 12.29
1996 11.34
1997 9.49
1998 -0.07
1999 2.12
2000 -7.21
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -5.60%.
<Table>
BEST QUARTER: 25.36% (quarter ended 3/31/91)
WORST QUARTER: -5.33% (quarter ended 12/31/00)
</Table>
23
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND
<Table>
1997 0.84
1998 12.53
1999 39.13
2000 -15.52
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -26.42%.
<Table>
BEST QUARTER: 22.28% (quarter ended 12/31/99)
WORST QUARTER: -16.14% (quarter ended 9/30/98)
</Table>
FORTIS INTERNATIONAL EQUITY PORTFOLIO
<Table>
1999 118
2000 -25.31
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was -29.82%.
<Table>
BEST QUARTER: 56.36% (quarter ended 12/31/99)
WORST QUARTER: -15.84% (quarter ended 6/30/00)
</Table>
24
THE HARTFORD MONEY MARKET FUND
<Table>
1997 4.73
1998 4.69
1999 4.32
2000 5.33
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was 2.88%.
<Table>
BEST QUARTER: 1.43% (quarter ended 12/31/00)
WORST QUARTER: 0.98% (quarter ended 6/30/99)
</Table>
FORTIS MONEY FUND
<Table>
1991 5.59
1992 3.06
1993 2.29
1994 3.45
1995 5.17
1996 4.68
1997 4.78
1998 4.82
1999 4.49
2000 5.70
</Table>
The Fund's Class A share total return for the nine-month period from January 1,
2001 to September 30, 2001 was 3.00%.
<Table>
BEST QUARTER: 1.56% (quarter ended 3/31/91)
WORST QUARTER: 0.54% (quarter ended 9/30/93)
</Table>
25
AVERAGE ANNUAL TOTAL RETURN TABLES
The following tables show the Funds' average annual total returns over
different periods ended December 31, 2000 and compare those returns to one or
more broad-based market indexes. Returns shown for the various classes of the
Hartford Funds and the Fortis Funds reflect any applicable sales charges. Total
returns for the indexes shown do not reflect sales charges, expenses or other
fees the Securities and Exchange Commission requires to be reflected in the
Funds' performance. Indexes are unmanaged, and it is not possible to invest
directly in an index.
The tables are arranged alphabetically according to the name of the
Hartford Fund. Please note that the average annual total return since a Fund's
inception is only given for those Funds that have been in existence for less
than ten calendar years.
THE HARTFORD ADVISORS FUND/FORTIS ASSET ALLOCATION PORTFOLIO
<Table>
<Caption>
SINCE INCEPTION --
FORTIS FUND
SINCE -----------------------
INCEPTION--
HARTFORD CLASS B,H,
1 YEAR 5 YEARS 10 YEARS FUND(1) C(2) CLASS Z(3)
------- ------- -------- ----------- ---------- ----------
The Hartford Advisors Fund
Class A........................ -4.65% N/A N/A 13.85% N/A N/A
Class B........................ -4.84% N/A N/A 14.23% N/A N/A
Class C(4)..................... -1.83% N/A N/A 14.23% N/A N/A
Fortis Asset Allocation Portfolio
Class A........................ -6.03% 12.18% 12.64% N/A N/A N/A
Class B........................ -5.04% 12.44% N/A N/A 13.70% N/A
Class H........................ -5.04% 12.45% N/A N/A 13.70% N/A
Class C........................ -2.76% 12.65% N/A N/A 13.65% N/A
Class Z........................ -0.91% N/A N/A N/A N/A 8.45%
S&P 500 Index(5)................. -9.10% 18.30% 17.43% 20.69% 20.24% 0.74%
Lehman Brothers Aggregate Bond
Index(6)....................... 11.63% 6.46% 7.96% 7.57% 8.21% 8.81%
Lehman Brothers Government/
Corporate Bond Index(7)........ 11.85% 6.24% 8.00% 7.49% 7.16% 9.61%
</Table>
- ---------------
(1) 7/22/96
(2) 11/14/94
(3) 7/27/99
(4) The Hartford Advisors Fund Class C shares commenced operations on July 31,
1998. Class C share performance prior to July 31, 1998 reflects Class B
share performance and operating expenses less Class C share sales charges.
(5) A market capitalization weighted price index composed of 500 widely-held
common stocks.
(6) An unmanaged index of government, corporate and mortgage-backed securities
with an average maturity of approximately nine years.
(7) A broad-based, unmanaged, market-value weighted index of all debt
obligations of the U.S. Treasury and U.S. Government agencies (excluding
mortgage-backed securities) and of all publicly issued, fixed-rate,
nonconvertible, investment grade domestic corporate debt.
26
THE HARTFORD GLOBAL LEADERS FUND/FORTIS GLOBAL GROWTH PORTFOLIO
<Table>
<Caption>
SINCE INCEPTION --
SINCE FORTIS FUND
INCEPTION -- -----------------------
HARTFORD CLASS B, H
1 YEAR 5 YEARS FUND(1) CLASS A(2) AND C(3)
------- ------- ------------ ---------- ----------
The Hartford Global Leaders Fund
Class A................................ -12.36% N/A 26.11% N/A N/A
Class B................................ -12.93% N/A 27.44% N/A N/A
Class C................................ -9.79% N/A 27.87% N/A N/A
Fortis Global Growth Portfolio
Class A................................ -23.46% 10.86% N/A 12.64% N/A
Class B................................ -22.82% 10.88% N/A N/A 13.14%
Class H................................ -22.79% 10.89% N/A N/A 13.15%
Class C................................ -20.98% 11.19% N/A N/A 13.21%
MSCI Index(4)............................ -13.18% 12.52% 18.80% 11.94% 13.91%
</Table>
- ---------------
(1) 9/30/98
(2) 7/08/91
(3) 11/14/94
(4) A broad-based, unmanaged, market capitalization weighted, total return index
which measures the performance of 23 developed country global stock markets,
including the United States, Canada, Europe, Australia, New Zealand and the
Far East.
THE HARTFORD GROWTH AND INCOME FUND/FORTIS GROWTH & INCOME FUND
<Table>
<Caption>
SINCE INCEPTION -- SINCE INCEPTION --
1 YEAR 5 YEARS HARTFORD FUND(1) FORTIS FUND(2)
------- ------- ------------------ ------------------
The Hartford Growth and Income Fund
Class A................................. -11.63% N/A 7.90% N/A
Class B................................. -12.22% N/A 8.43% N/A
Class C(3).............................. -9.08% N/A 9.04% N/A
Fortis Growth & Income Fund
Class A................................. -0.77% 12.19% N/A 12.19%
Class B................................. -0.06% 12.22% N/A 12.22%
Class H................................. -0.06% 12.22% N/A 12.22%
Class C................................. 2.44% 12.44% N/A 12.44%
S&P 500 Index(4).......................... -9.10% 18.30% 11.76% 18.30%
</Table>
- ---------------
(1) 4/30/98
(2) 1/02/96
(3) The Hartford Growth and Income Fund Class C shares commenced operations on
July 31, 1998. Class C share performance prior to July 31, 1998 reflects
Class B share performance and operating expenses less Class C share sales
charges.
(4) A market capitalization weighted price index composed of 500 widely held
common stocks.
27
THE HARTFORD HIGH YIELD FUND/FORTIS HIGH YIELD PORTFOLIO
<Table>
<Caption>
SINCE
INCEPTION -- SINCE INCEPTION --
HARTFORD FORTIS FUND CLASS
1 YEAR 5 YEARS 10 YEARS FUND(1) B, C, H(2)
------- ------- -------- ------------ ------------------
The Hartford High Yield Fund
Class A.............................. -3.91% N/A N/A 1.21% N/A
Class B.............................. -5.08% N/A N/A 1.27% N/A
Class C.............................. -2.06% N/A N/A 2.13% N/A
Fortis High Yield Portfolio
Class A.............................. -11.39% 1.97% 10.15% N/A N/A
Class B.............................. -10.95% 2.05% N/A N/A 3.36%
Class H.............................. -10.81% 2.08% N/A N/A 3.36%
Class C.............................. -8.73% 2.23% N/A N/A 3.34%
Lehman High Yield Corporate Index(3)... -5.86% 6.62% 9.09% -0.70% 6.34%
</Table>
- ---------------
(1) 9/30/98
(2) 11/14/94
(3) A broad-based, market-value weighted index that tracks the total return
performance of non-investment grade, fixed-rated, publicly placed, dollar
denominated and nonconvertible debt registered with the SEC.
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND/FORTIS INTERNATIONAL
EQUITY PORTFOLIO
<Table>
<Caption>
SINCE INCEPTION -- SINCE INCEPTION --
1 YEAR HARTFORD FUND(1) FORTIS FUND(2)
------- ------------------ ------------------
The Hartford International Opportunities Fund
Class A.......................................... -20.17% 7.21% N/A
Class B.......................................... -21.20% 7.47% N/A
Class C(3)....................................... -16.20% 7.56% N/A
Fortis International Equity Portfolio
Class A.......................................... -28.86% N/A 20.67%
Class B.......................................... -28.41% N/A 21.29%
Class H.......................................... -28.43% N/A 21.24%
Class C.......................................... -26.61% N/A 21.95%
EAFE GDP Index(4).................................. -18.04% 10.51%(5) 8.52%
MSCI EAFE Index(6)................................. -13.96% 6.25%(5) 5.14%
</Table>
- ---------------
(1) 7/22/96
(2) 3/02/98
(3) Class C shares commenced operation on July 31, 1998. Class C share
performance prior to July 31, 1998 reflects Class B shares performance and
operating expenses less Class C share sales charges.
(4) The Morgan Stanley Europe, Australia, Far East GDP Index is an unmanaged
index of stocks of companies representing stock markets in Europe,
Australia, New Zealand and the Far East.
(5) Return is from 7/31/96 to 12/31/00.
(6) An unmanaged index of the stocks of Europe, Australia and the Far East.
28
THE HARTFORD MONEY MARKET FUND/FORTIS MONEY FUND
<Table>
<Caption>
SINCE INCEPTION --
SINCE INCEPTION -- FORTIS FUND CLASS
1 YEAR 5 YEARS 10 YEARS HARTFORD FUND(1) B, H AND C(2)
------ ------- -------- ------------------ ------------------
The Hartford Money Market Fund
Class A........................... 5.53% N/A N/A 4.79% N/A
Class B........................... -0.20% N/A N/A 3.29% N/A
Class C(3)........................ -2.74% N/A N/A 3.79% N/A
Fortis Money Fund
Class A........................... 5.70% 4.89% 4.40% N/A N/A
Class B........................... 1.27% 3.78% N/A N/A 4.18%
Class H........................... 1.25% 3.80% N/A N/A 4.18%
Class C........................... 3.84% 4.38% N/A N/A 4.46%
60-Day Treasury Bill Index(4)....... 6.11% 5.27% 4.85% 5.27% 5.35%(5)
</Table>
- ---------------
(1) 7/22/96
(2) 11/14/94
(3) The Hartford Money Market Fund Class C shares commenced operations on July
31, 1998. Class C share performance prior to July 31, 1998 reflects Class B
share performance and operating expenses less Class C share sales charges.
(4) An unmanaged index of short-term treasury bills.
(5) Return is from 10/31/94 to 12/31/00.
29
COMPARISON OF OPERATIONS
INVESTMENT ADVISORY AGREEMENTS
Hartford Investment Financial Services, LLC ("HIFSCO") serves as the
investment manager of each of the Hartford Funds. HIFSCO also has acted as the
investment manager of each of the Fortis Funds since the Fortis Funds' previous
adviser, Fortis Advisers, Inc., was acquired by The Hartford Life and Accident
Insurance Company on April 2, 2001 (the "Acquisition"). HIFSCO is a wholly-owned
indirect subsidiary of The Hartford Financial Services Group, Inc. ("The
Hartford"), a Connecticut financial services company with over $170.6 billion in
assets as of September 30, 2001. HIFSCO had over $11.0 billion in assets under
management as of September 30, 2001. HIFSCO is responsible for the management of
each Hartford Fund and each Fortis Fund and supervises the activities of the
investment sub-advisers described below. HIFSCO is principally located at 200
Hopmeadow Street, Simsbury, Connecticut 06070.
Wellington Management Company, LLP is the investment sub-adviser to The
Hartford Advisers Fund, The Hartford Global Leaders Fund, The Hartford Growth
and Income Fund and The Hartford International Opportunities Fund. Since the
Acquisition, Wellington Management also has acted as the investment sub-adviser
to each corresponding Fortis Fund: Fortis Asset Allocation Portfolio, Fortis
Global Growth Portfolio, Fortis Growth & Income Fund and Fortis International
Equity Portfolio. Wellington Management, a Massachusetts limited liability
partnership, is a professional investment counseling firm that provides services
to investment companies, employee benefit plans, endowments, foundations and
other institutions and individuals. Wellington Management and its predecessor
organizations have provided investment advisory services since 1928. As of June
30, 2001, Wellington Management had investment management authority over
approximately $295 billion in assets. Wellington Management is principally
located at 75 State Street, Boston Massachusetts 02109.
The Hartford Investment Management Company ("HIMCO(R)") is the investment
sub-adviser to The Hartford High Yield Fund, The Hartford Money Market Fund and,
since the Acquisition, Fortis High Yield Portfolio and Fortis Money Fund. HIMCO
is a professional money management firm that provides services to investment
companies, employee benefit plans and insurance companies. HIMCO is a wholly
owned subsidiary of The Hartford. As of September 30, 2001, HIMCO and its wholly
owned subsidiary had investment authority over approximately $73.7 billion in
assets. HIMCO is principally located at 55 Farmington Avenue, Hartford,
Connecticut 06105.
The same individuals from either Wellington Management or HIMCO who are
primarily responsible for the day-to-day management of a Hartford Fund are also
responsible for the day-to-day management of the corresponding Fortis Fund.
OTHER SERVICE PROVIDERS
The Hartford Funds and the Fortis Funds have the same distributor, transfer
agent and custodian, and different independent accountants. In all cases, the
types of services provided to the Funds under these service arrangements are
substantially similar.
<Table>
<Caption>
HARTFORD FUNDS FORTIS FUNDS
-------------- ------------
Distributor.................... Hartford Investment Financial Hartford Investment Financial
Services Company Services Company
Transfer Agent................. Hartford Administrative Services Hartford Administrative Services
Company (known as Fortis Company
Advisers, Inc. prior to the
Acquisition)
Custodian...................... State Street Bank and Trust State Street Bank and Trust
Company Company
Independent Accountants........ Arthur Andersen LLP KPMG LLP
</Table>
30
SALES LOAD, DISTRIBUTION AND SHAREHOLDER SERVICING ARRANGEMENTS
Each Hartford Fund offers Class A, Class B, Class C and Class Y Shares.
Each class, other than Class Y, has adopted a Rule 12b-1 plan which allows the
class to pay distribution fees for the sale and distribution of its shares and
for providing services to shareholders.
Each Fortis Fund offers Class A, Class B, Class H and Class C shares. In
addition, Fortis Asset Allocation Portfolio offers Class Z shares. Each of these
classes, other than Class Z, has also adopted a Rule 12b-1 plan.
In the Reorganization, Fortis Fund shareholders will receive Hartford Fund
shares of a comparable class, as set forth below:
<Table>
<Caption>
WILL RECEIVE SHARES OF
FORTIS FUND HARTFORD FUND
- ----------- ----------------------
Class A Class A
Class B or Class H Class B
Class C Class C
Class Z Class A
</Table>
Hartford Fund and Fortis Fund Class A Shares. Class A shares of both the
Hartford Funds and the Fortis Funds may be purchased at a public offering price
equal to their net asset value per share plus a sales charge, except that Class
A shares of The Hartford Money Market Fund and Fortis Money Fund are not subject
to a sales charge. A comparison of front-end sales charges is set forth in the
following tables.
SALES CHARGES FOR EQUITY FUNDS*
<Table>
<Caption>
HARTFORD FUNDS FORTIS FUNDS}
----------------------------------- -----------------------------------
DEALER DEALER
COMMISSION COMMISSION
AS A % OF AS A % OF AS A % OF AS A % OF AS A % OF AS A % OF
OFFERING NET OFFERING OFFERING NET OFFERING
YOUR INVESTMENT PRICE INVESTMENT PRICE PRICE INVESTMENT PRICE**
- --------------- --------- ---------- ---------- --------- ---------- ----------
Less than $50,000.................. 5.50% 5.82% 4.75% 4.75% 4.99% 4.00%
$50,000-$99,999.................... 4.50% 4.71% 4.00% 4.75% 4.99% 4.00%
$100,000-$249,999.................. 3.50% 3.63% 3.00% 3.50% 3.63% 3.00%
$250,000-$499,999.................. 2.50% 2.56% 2.00% 2.50% 2.56% 2.25%
$500,000-$999,999.................. 2.00% 2.04% 1.75% 2.00% 2.04% 1.75%
$1,000,000 or more***.............. 0% 0% **** 0% 0% 1.00%
</Table>
- ---------------
* Includes The Hartford Advisers Fund, The Hartford Global Leaders Fund, The
Hartford Growth and Income Fund, The Hartford International Opportunities
Fund, Fortis Asset Allocation Portfolio, Fortis Global Growth Portfolio,
Fortis Growth & Income Fund, and Fortis International Equity Portfolio.
** A dealer receives additional compensation (as a percentage of the sales
charge) when its annual sales of funds in the Fortis Fund family that have
a sales charge exceed $10 million (2%), $25 million (4%) and $50 million
(5%).
*** There is a contingent deferred sales charge of 1% on Hartford Fund shares
sold within 18 months of purchase and on Fortis Fund shares sold within two
years of purchase.
**** Up to 1.00% of the first $4 million, plus 0.50% of the next $6 million,
plus 0.25% of share purchases over $10 million.
31
SALES CHARGES FOR HIGH YIELD FUNDS
<Table>
<Caption>
THE HARTFORD HIGH YIELD FUND FORTIS HIGH YIELD PORTFOLIO
----------------------------------- -----------------------------------
DEALER DEALER
COMMISSION COMMISSION
AS A % OF AS A % OF AS A % OF AS A % OF AS A % OF AS A % OF
OFFERING NET OFFERING OFFERING NET OFFERING
YOUR INVESTMENT PRICE INVESTMENT PRICE PRICE INVESTMENT PRICE*
- --------------- --------- ---------- ---------- --------- ---------- ----------
Less than $50,000............. 4.50% 4.71% 3.75% 4.50% 4.71% 4.00%
$50,000-$99,999............... 4.00% 4.17% 3.50% 4.50% 4.71% 4.00%
$100,000-$249,999............. 3.50% 3.63% 3.00% 3.50% 3.63% 3.00%
$250,000-$499,999............. 2.50% 2.56% 2.00% 2.50% 2.56% 2.25%
$500,000-$999,999............. 2.00% 2.04% 1.75% 2.00% 2.04% 1.75%
$1,000,000 or more**.......... 0% 0% *** 0% 0% 1.00%
</Table>
- ---------------
* A dealer receives additional compensation (as a percentage of the sales
charge) when its annual sales of funds in the Fortis Fund family that have a
sales charge exceed $10 million (2%), $25 million (4%) and $50 million (5%).
** There is a contingent deferred sales charge of 1% on Hartford Fund shares
sold within 18 months of purchase and on Fortis Fund shares sold within two
years of purchase.
*** Up to 1.00% of the first $4 million, plus 0.50% of the next $6 million, plus
0.25% of share purchases over $10 million.
Hartford Fund Class A shares are subject to Rule 12b-1 distribution and
service fees of 0.35%. The Hartford Funds' distributor has contractually agreed
to reduce this fee to 0.30% through at least February 28, 2003. The waiver may
be discontinued at any time thereafter. Rule 12b-1 fees for the Fortis Funds are
0.45% for Asset Allocation Portfolio, 0.35% for High Yield Portfolio, 0.25% for
Global Growth Portfolio, Growth & Income Fund and International Equity
Portfolio, and 0.20% for Money Fund.
Hartford Fund Class B Shares; Fortis Fund Class B and Class H
Shares. Class B shares of the Hartford Funds and Class B and Class H shares of
the Fortis Funds are offered at their net asset value per share, without any
initial sales charge. The shares are subject to a contingent deferred sales
charge ("CDSC") if sold within a certain period of time, as described in the
table below. Hartford Fund Class B shares and Fortis Fund Class B and Class H
shares automatically convert to Class A shares after eight years.
<Table>
<Caption>
YEARS AFTER HARTFORD FUNDS FORTIS FUNDS
PURCHASE CDSC CDSC
- ----------- -------------- ------------
1st year.................................................... 5.00% 4.00%
2nd year.................................................... 4.00% 4.00%
3rd year.................................................... 3.00% 3.00%
4th year.................................................... 3.00% 3.00%
5th year.................................................... 2.00% 2.00%
6th year.................................................... 1.00% 1.00%
After 6 years............................................... None None
</Table>
Both Hartford Fund Class B shares and Fortis Fund Class B and Class H
shares are subject to Rule 12b-1 distribution and service fees of 1.00% of a
Fund's average daily net assets.
Class B and Class H shares of the Fortis Funds differ only in the amount of
compensation paid by the Fortis Funds' distributor to dealers who sell the
shares.
Hartford Fund and Fortis Fund Class C Shares. Hartford Fund Class C shares
are subject to a 1.00% front-end sales charge, as well as a 1.00% CDSC if the
shares are sold within one year of purchase.
32
Fortis Fund Class C shares also are subject to a 1.00% CDSC if sold within one
year of purchase, but they are not subject to an initial sales charge.
Both Hartford Fund and Fortis Fund Class C shares are subject to Rule 12b-1
distribution and service fees of 1.00% of a Fund's average daily net assets.
There is no automatic conversion to Class A shares for either the Hartford Fund
or the Fortis Fund Class C shares, so annual expenses continue at the Class C
level throughout the life of an investment.
Sales Charge Reductions and Waivers. Class A share sales charges for both
the Hartford Funds and the Fortis Funds are subject to reductions and waivers
under similar circumstances, as set forth in the Funds' prospectuses.
The Hartford Funds waive payment of the Class B share and Class C share
CDSC to make systematic withdrawal plan payments that are limited annually to no
more than 12% of the value of the account at the time the plan is initiated. The
Fortis Funds waive payment of the Class B share and Class H share CDSC (but not
the Class C share CDSC) on redemptions of shares that represent, on an annual
(non-cumulative) basis, up to 10% of the amount (at the time of investment) of
the shareholder's purchases. The Hartford Funds and the Fortis Funds waive
payment of CDSCs under certain other similar circumstances, as set forth in the
Funds' prospectuses.
Fortis Fund Class Z Shares. Fortis Fund Class Z shares are available only
in Asset Allocation Portfolio and only for investment by:
- Accounts of Fortis, Inc. or its subsidiaries, officers, directors,
employees and sales representatives (and their families) which were in
existence and entitled to purchase Class Z shares at the time of the
acquisition of Fortis Advisers, Inc. by The Hartford Life and Accident
Insurance Company ("Hartford Life") on April 2, 2001 (the "Acquisition");
- Pension, profit sharing and other retirement plans created for the
benefit of Fortis Inc. or its subsidiaries which were in existence and
entitled to purchase Class Z shares at the time of the Acquisition; and
- Present or former officers, directors and employees (and their families)
of the Fortis Funds, The Hartford, Wellington Management, the Funds'
transfer agent, and their affiliates.
Investors do not pay any sales charge on Fortis Fund Class Z shares, either
at the time of purchase or upon redemption. In addition, Fortis Fund Class Z
shares are not subject to any Rule 12b-1 distribution or service fees.
Fortis Fund Class Z shares will be exchanged for Hartford Fund Class A
shares which are subject to Rule 12b-1 distribution and service fees of 0.35%,
as described above.
PURCHASE, EXCHANGE AND REDEMPTION PROCEDURES
The transfer agent and dividend disbursing agent for each of the Hartford
Funds and Fortis Funds is Hartford Administrative Services Company (known as
Fortis Advisers, Inc. before the Acquisition). Procedures for the purchase,
exchange and redemption of each Hartford Fund's shares are similar to the
procedures applicable to the purchase, exchange and redemption of the Fortis
Fund shares. Reference is made to the Prospectuses of the Hartford Funds, and
the Prospectuses of the Fortis Funds, each of which is incorporated herein by
reference, for a complete description of the procedures applicable to purchases,
exchanges and redemptions of Hartford Fund and Fortis Fund shares, respectively.
Set forth below is a brief description of the significant purchase, exchange and
redemption procedures applicable to the Hartford Fund shares and the Fortis Fund
shares.
Minimum Investments. The minimum initial investment for each Hartford
Fund, which may be waived in certain circumstances, is $500 for non-retirement
accounts, $250 for retirement accounts, and $25 to open an Automatic Investment
Plan, with required investments of at least $25 a month. The minimum required
for subsequent investments is $25.
33
The minimum initial investment in any of the Fortis Funds is $500, except
that the minimum initial investment under the Systematic Investment Plan is $25
for the Pre-Authorized Check Plan and $50 for any other Systematic Investment
Plan (except for telephone or wire orders). The minimum subsequent investment is
$50 for investments by mail ($25 for the Pre-Authorized Check Plan), $25 for
investments by telephone through the Fortis Information Line and Fortis Internet
Website, and $500 for other investments by telephone or investments by wire.
Investing by Telephone. Both the Hartford Funds and the Fortis Funds offer
automated telephone investing and internet investing. Hartford Fund investors
may add to an account by telephone or the internet if their bank or credit union
is a member of the Automated Clearing House (ACH) system and they have completed
the "Telephone Exchanges and Telephone Redemption" and the "Bank Account or
Credit Union Information" sections on their account application.
For the Fortis Funds, except for Fortis Money Fund, if an investor has a
bank account authorization form on file, he or she may invest $25-$150,000 by
telephone through the automated Fortis Information Line and Fortis Internet
Website. Registered representatives may also make purchases on an investor's
behalf by telephone. The investor's check and account application must be
promptly forwarded so as to be received within three business days.
Investing by Wire. An investor may make initial and subsequent purchases
by wire of both Hartford Fund and Fortis Fund shares by instructing his or her
bank to wire funds in the manner described in the respective Fund's prospectus.
For the Fortis Funds, there is a $500 minimum for wire purchases. Before making
an initial purchase of shares by wire in either the Hartford Funds or the Fortis
Funds, an investor must complete an application and obtain an account number.
Investing by Mail. Investors in both the Hartford Funds and the Fortis
Funds may open and add to accounts by mail.
Exchange Privilege. Hartford Fund shareholders may exchange shares of one
Hartford Fund for shares of the same class of any other Hartford Fund.
Similarly, except for Class Z shares, shareholders may exchange their Fortis
Fund shares for the same class of shares in another Fortis Fund. Class Z shares
of Asset Allocation Portfolio may be exchanged for Class Z shares of Fortis
Growth Fund or for Class A shares of any other Fortis Fund. For both the Fortis
Funds and the Hartford Funds, shareholders pay no exchange fee or additional
sales charges for exchanges, except in the case of exchanges of money market
fund Class A shares that have not already incurred a sales charge. A Hartford
Fund shareholder may make an exchange by calling his or her financial
representative or the Fund's transfer agent. A Fortis Fund shareholder may make
an exchange by writing to or telephoning his or her broker-dealer, sales
representative, or the applicable Fortis Fund.
Redemption. Shares of both the Hartford Funds and the Fortis Funds may be
redeemed by mail or by telephone. Redemptions by telephone are restricted to
sales of up to $50,000 for the Fortis Funds and to sales of $50,000 in any seven
day period for the Hartford Funds. Hartford Money Market Fund Class A shares and
Fortis Money Fund shares also may be redeemed by check for amounts over $100.
Both the Hartford Funds and the Fortis Funds offer automatic investment
plans and systematic withdrawal plans. The Hartford Funds also offer a dollar
cost averaging plan. For additional information concerning purchase, exchange
and redemption procedures for the Hartford Funds, see the accompanying Hartford
Fund prospectus under the captions "About Your Account" and "Transaction
Policies."
34
DIVIDENDS AND OTHER DISTRIBUTIONS
The following chart compares when each Fortis Fund and each Hartford Fund
declares and pays dividends. All of the Fortis Funds and Hartford Funds declare
and pay capital gain distributions, if any, at least annually.
<Table>
<Caption>
DIVIDEND DIVIDEND
FORTIS FUND DISTRIBUTIONS HARTFORD FUND DISTRIBUTIONS
- ----------- ------------- ------------- -------------
Fortis Asset Declares and pays The Hartford Advisers Declares and pays
Allocation Portfolio quarterly Fund quarterly
Fortis Global Growth Declares and pays The Hartford Global Declares and pays
Portfolio annually Leaders Fund annually
Fortis Growth & Income Declares and pays The Hartford Growth and Declares and pays
Fund annually Income Fund quarterly
Fortis High Yield Declares daily The Hartford High Yield Declares and pays
Portfolio and pays monthly Fund monthly
Fortis International Declares and pays The Hartford Declares and pays
Equity Portfolio annually International annually
Opportunities Fund
Fortis Money Fund Declares daily The Hartford Money Declares daily and
and pays monthly Market Fund pays monthly
</Table>
With respect to both the Hartford Funds and the Fortis Funds, unless a
shareholder otherwise instructs, dividends and/or capital gain distributions
will be reinvested automatically in additional shares of the same class at net
asset value.
TAX CONSEQUENCES
As a condition to the Reorganization, each Hartford Fund and each Fortis
Fund will receive an opinion of counsel that the Reorganization will be
considered a tax-free "reorganization" under applicable provisions of the Code
so that neither the Hartford Fund nor the Fortis Fund nor the shareholders of
the Fortis Fund will recognize any gain or loss. The tax basis of the Hartford
Fund's shares received by the Fortis Fund's shareholders will be the same as the
tax basis of their shares in the Fortis Fund.
INFORMATION ABOUT THE REORGANIZATION
CONSIDERATIONS BY THE BOARD OF DIRECTORS OF THE FORTIS FUNDS
The Board of Directors of the Fortis Funds believes that the proposed
Reorganization is in the best interests of each Fortis Fund and its shareholders
and that the interests of the Fortis Fund shareholders will not be diluted as a
result of the Reorganization. The Board first considered engaging in such
transactions with the Hartford Funds at an in-person meeting of the Board of
Directors held on June 20, 2001. At this meeting, representatives of Hartford
Life and its affiliates discussed the proposed Reorganization with the Board in
general terms. These representatives also presented certain preliminary
information to the Board, including comparative performance, expense and asset
size information for the Hartford Funds and the Fortis Funds. In considering the
proposed Reorganization, the Board was advised at all formal meetings by the
Fortis Funds' outside legal counsel.
The Board met again in person on August 2, 2001 to receive additional
information concerning the Reorganization. At this meeting, the Board (including
all of the directors who are not "interested persons," as that term is defined
in the Investment Company Act of 1940, as amended ("1940 Act")) unanimously
approved the Reorganization, subject to the satisfaction of certain conditions
including their review and approval of the Plan. On August 10, 2001, four
independent directors of the Fortis Funds met informally in person with four
independent directors of the Hartford Funds. The Fortis Fund independent
directors then met telephonically on August 24, 2001, to discuss the status of
the conditions to their approval. The Board subsequently reviewed and
unanimously approved the Reorganization and Plan at an in-person meeting (with
two directors attending telephonically) held September 26, 2001, and recommended
its
35
approval by Fortis Fund shareholders. In approving the Reorganization, the Board
determined that participation in the Reorganization is in the best interests of
each Fortis Fund and that the interests of Fortis Fund shareholders would not be
diluted as a result of the Reorganization. In approving the Plan, the Board
considered the following factors:
- The investment objectives of the Fortis Funds and their corresponding
Hartford Funds are substantially similar and their investment policies
and strategies are substantially identical. In addition, corresponding
Fortis Funds and Hartford Funds are managed by the same portfolio
managers. Thus, the Reorganization will enable Fortis Fund shareholders
to continue their current investment programs without substantial
disruption.
- The Reorganization will result in each surviving Fund having a larger
asset base. In addition, the surviving Funds will have access to The
Hartford's substantially larger distribution network which may generate
additional assets for the Funds. Thus, the Reorganization may give Fortis
Fund shareholders the benefit of economies of scale.
- The Reorganization will allow Fortis Fund shareholders access to The
Hartford's larger family of retail mutual funds. After the
Reorganization, Fortis Fund shareholders will be able to exchange into
shares of any other Hartford retail mutual fund without paying a sales
charge (except for The Hartford MidCap Fund, which currently is not
available to new investors). Thus, as a result of the Reorganization,
Fortis Fund shareholders will gain access to a much broader range of
funds.
- Fortis Fund shareholders will not have to pay any federal income tax
solely as a result of the Reorganization.
- The Board noted that the Fortis Funds will be required to distribute any
realized capital gains to shareholders prior to the Reorganization
(except with respect to Fortis Money Fund, which would not be expected to
have any capital gains or losses) and that any such distributions
generally would be taxable to shareholders.
- Hartford Life or the applicable Hartford Funds will be responsible for
the payment of the expenses related to consummating the Reorganization.
- The proposed Reorganization will be effected on the basis of the relative
net asset values of the Hartford Funds and their corresponding Fortis
Funds, so that Fortis Fund shareholders will receive Hartford Fund shares
having a total net asset value equal to the total net asset value of
their Fortis Fund shares as of the closing of the Reorganization.
- The historical performance of the respective Hartford Funds generally
compares favorably to that of the corresponding Fortis Funds. In
addition, the expense ratios after voluntary fee waivers of the Hartford
Funds are within industry norms and are comparable to or slightly lower
than those of the corresponding Fortis Funds in three out of six cases.
The Board noted in this regard that the after-waiver expense ratios of
The Hartford Global Leaders Fund, The Hartford High Yield Fund and The
Hartford Money Market Fund are higher than those of Fortis Global Growth
Portfolio, Fortis High Yield Portfolio and Fortis Money Fund,
respectively. In addition, for the Fortis Asset Allocation Portfolio
Class Z shareholders, expenses will be higher after the Reorganization
because those shares are being exchanged for Class A Hartford Fund
shares. The Board also noted that HIFSCO could discontinue its fee
waivers at any time after February 28, 2002 (which date was changed to
February 28, 2003 subsequent to the Board meeting), which would result in
increased expenses for several of the Hartford Funds. See
"Summary -- Comparative Fee Tables." The Board believes that these latter
factors are counterbalanced by the economies of scale that may result
from the proposed Reorganization and by the other anticipated benefits of
the proposed transactions to Fortis Fund shareholders.
The Board did not assign relative weights to the foregoing factors or deem
any one or group of them to be controlling in and of themselves.
36
Subsequent to the September 26, 2001 Board meeting, the Hartford Funds
entered into transfer agency agreements with Hartford Administrative Services
Company that provide for the calculation of transfer agency fees on a different
basis than had previously been the case. In addition, Hartford Fund fee and
expense information for the fiscal year ended October 31, 2001 became available.
The Fortis Fund Board determined that it would be appropriate to reconsider the
Reorganization in light of this new financial information, and did so at its
regular quarterly meeting on December 13, 2001. Upon reexamining Hartford Fund
expense ratios, the Board noted that expense ratios after voluntary waivers
continued to be within industry norms and remained comparable to or slightly
lower than those of the corresponding Fortis Funds in three out of six cases
when comparing Class A shares. The Board also noted that the new transfer agency
fees were within industry norms and that HIFSCO had extended its fee waivers
through February 28, 2003. Based on these factors and its earlier
considerations, the Board reaffirmed its determination that participation in the
Reorganization is in the best interests of each Fortis Fund and that the
interests of Fortis Fund shareholders will not be diluted as a result of the
Reorganization.
Under Maryland law and the Fortis Funds' organizational documents, the
directors of each Fortis Fund are entitled to be indemnified by the applicable
fund for certain liabilities they may incur in connection with their service as
directors. Under the Plan, each Hartford Fund is required to assume all of the
liabilities of its corresponding Fortis Fund, including any obligation of the
Fortis Fund to indemnify the Fortis Fund directors.
The Board of Directors of the Hartford Funds (including a majority of the
Directors who are not "interested persons," as that term is defined in the 1940
Act), approved the Plan on September 26, 2001. The Board has unanimously
concluded that consummation of the Reorganization is in the best interests of
the Hartford Funds and the shareholders of the Hartford Funds and that the
interests of Hartford Fund shareholders would not be diluted as a result of
effecting the Reorganization and have unanimously voted to approve the Plan.
DESCRIPTION OF THE PLAN OF REORGANIZATION
The Plan provides that your Fortis Fund will transfer all its assets and
liabilities to a corresponding Hartford Fund in exchange solely for the Hartford
Fund's shares to be distributed pro rata by the Fortis Fund to its shareholders
in complete liquidation of the Fortis Fund on or about February 19, 2002 (the
"Closing Date"). The value of each Fortis Fund's assets to be acquired by the
Hartford Fund shall be the value of such assets computed as of the close of
regular trading on the New York Stock Exchange (normally 4:00 p.m. Eastern time)
on the Closing Date (the "Closing"). Fortis Fund shareholders will become
shareholders of the corresponding Hartford Fund as of the Closing, and will be
entitled to the Hartford Fund's next dividend distribution thereafter. Fortis
Fund shareholders will receive Hartford Fund shares of a comparable class having
a total net asset value equal to the total net asset value of their Fortis Fund
shares as of the Closing. Fortis Fund Class A, Class B and Class C shareholders
will receive Class A, Class B or Class C shares, respectively, of the
corresponding Hartford Fund. Fortis Fund Class H shareholders will receive
Hartford Fund Class B shares. Fortis Asset Allocation Portfolio Class Z
shareholders will receive The Hartford Advisers Fund Class A shares.
On or before the Closing, each Fortis Fund will declare and pay a dividend
or dividends which, together with all previous dividends, shall have the effect
of distributing to its shareholders substantially all of its net investment
income and realized net capital gain, if any, for all taxable years ending on or
before the Closing Date.
The Plan provides that no sales charges will be incurred by Fortis Fund
shareholders in connection with their acquisition of Hartford Fund shares in the
Reorganization. The Plan also provides that former holders of Fortis Fund shares
that were subject to a contingent deferred sales charge will receive credit for
the period they held such Fortis Fund shares in determining any contingent
deferred sales charge due upon redemption of the Hartford Fund shares they
receive in the Reorganization and in determining the date upon which any
Hartford Fund Class B shares received in the Reorganization convert to Hartford
Fund Class A shares.
37
Consummation of the Reorganization is subject to the conditions set forth
in the Plan, including receipt of an opinion in form and substance reasonably
satisfactory to the Fortis Funds and the Hartford Funds, as described under the
caption "Federal Income Tax Consequences" below. The Plan may be terminated and
the Reorganization may be abandoned at any time before or after approval by the
Fortis Fund shareholders prior to the Closing Date by either party if it
believes that consummation of the Reorganization would not be in the best
interests of its shareholders.
Under the Plan, Hartford Life or the applicable Hartford Funds will be
responsible for the payment of the expenses related to consummating the
Reorganization. Such expenses include, but are not limited to, accountants'
fees, legal fees, registration fees, transfer taxes (if any), the fees of banks
and transfer agents and the costs of preparing, printing, copying and mailing
proxy solicitation materials to the Fortis Fund shareholders and the costs of
holding the Special Meeting (as hereinafter defined).
The foregoing description of the Plan entered into between the Hartford
Funds and the Fortis Funds is qualified in its entirety by the terms and
provisions of the Plan, the form of which is attached hereto as Appendix A and
incorporated herein by reference thereto.
DESCRIPTION OF HARTFORD FUND SHARES
Full and fractional shares of the Hartford Funds will be issued in the
Reorganization without the imposition of a sales charge or other fee to the
Fortis Fund shareholders in accordance with the procedures described above.
Shares of the Hartford Funds to be issued to Fortis Fund shareholders under the
Plan will be fully paid and non-assessable when issued and transferable without
restriction and will have no preemptive or conversion rights. Reference is
hereby made to the Prospectus of the Hartford Fund into which your Fortis Fund
will be reorganized, provided herewith for additional information about shares
of the Hartford Fund.
FEDERAL INCOME TAX CONSEQUENCES
As a condition to each Reorganization, the participating Hartford Fund and
Fortis Fund will receive an opinion from counsel to the effect that, on the
basis of the existing provisions of the Code, current administrative rules and
court decisions, for federal income tax purposes: (1) the Reorganization will
qualify as a "reorganization" under section 368(a)(1) of the Code, and the
Hartford Fund and the Fortis Fund involved therein each will be "a party to a
reorganization" within the meaning of section 368(b) of the Code; (2) the Fortis
Fund will recognize no gain or loss on the transfer of its assets to the
Hartford Fund in exchange solely for the Hartford Fund's shares or on the
subsequent distribution of those shares to the Fortis Fund's shareholders in
exchange for their Fortis Fund shares; (3) the Hartford Fund will recognize no
gain or loss on its receipt of those assets in exchange solely for its shares;
(4) the Hartford Fund's basis in those assets will be the same as the Fortis
Fund's basis therein immediately before the Reorganization, and the Hartford
Fund's holding period for those assets will include the Fortis Fund's holding
period therefor; (5) a Fortis Fund shareholder will recognize no gain or loss on
the constructive exchange of the shareholder's Fortis Fund shares solely for
Hartford Fund shares pursuant to the Reorganization; and (6) a Fortis Fund
shareholder's aggregate basis in the Hartford Fund shares received by the
shareholder in the Reorganization will be the same as the aggregate basis in the
shareholder's Fortis Fund shares to be constructively surrendered in exchange
for those Fortis Fund shares, and the shareholder's holding period for those
Hartford Fund shares will include the shareholder's holding period for those
Fortis Fund shares, provided the shareholder holds them as capital assets at the
time of the Reorganization.
You should recognize that an opinion of counsel is not binding on the
Internal Revenue Service ("IRS") or any court. Neither the Fortis Funds nor the
Hartford Funds expect to obtain a ruling from the IRS regarding the consequences
of the Reorganizations. Accordingly, if the IRS sought to challenge the tax
treatment of any Reorganization and was successful, neither of which is
anticipated, the Reorganization would be treated as a taxable sale of assets of
the participating Fortis Fund, followed by the taxable liquidation thereof.
38
Because the investment policies and practices of the Hartford Funds are
substantially identical to those of their corresponding Fortis Funds, the
Hartford Funds do not anticipate that taxable sales involving significant
amounts of securities of the combined portfolios will have to be made after the
Reorganizations.
COMPARATIVE INFORMATION ON SHAREHOLDER RIGHTS AND OBLIGATIONS
At a special meeting of Fortis Fund shareholders held on May 31, 2001, as
adjourned to June 21, 2001, Fortis Fund shareholders approved the reorganization
of each Fortis Fund as a series of a Maryland corporation. The Fortis Funds had
previously been organized as Minnesota corporations or series of Minnesota
corporations. The reorganization was effected as of the close of business on
November 30, 2001. Because the Hartford Funds are also series of a Maryland
corporation, your rights as a shareholder of a Hartford Fund will not differ
from your rights as a shareholder of a Fortis Fund.
39
CAPITALIZATION
The following tables set forth the unaudited capitalization of each Fortis
Fund and of the Hartford Fund into which the Fortis Fund will be reorganized as
of October 31, 2001:
<Table>
<Caption>
FORTIS ASSET HARTFORD PRO
THE HARTFORD ALLOCATION FORMA
ADVISERS FUND PORTFOLIO COMBINED
------------- ---------------- ------------
Net Assets (in thousands)........................... $ 2,245,891 $ 224,074 $ 2,469,965
Net Asset Value Per Share
Class A........................................... $ 14.38 $ 14.14 $ 14.38
Class B........................................... $ 14.24 $ 14.02 $ 14.24
Class C........................................... $ 14.37 $ 13.94 $ 14.37
Class H........................................... $ -- $ 14.00 $ --
Class Z........................................... $ -- $ 14.13 $ --
Class Y........................................... $ 14.54 -- $ 14.54
Shares Outstanding
Class A........................................... 75,719,253 10,755,133 86,456,192
Class B........................................... 43,726,969 1,638,505 47,881,273
Class C........................................... 33,286,046 756,693 34,020,096
Class H........................................... -- 2,584,675 --
Class Z........................................... -- 164,162 --
Class Y........................................... 3,875,798 -- 3,875,798
</Table>
<Table>
<Caption>
THE HARTFORD FORTIS GLOBAL HARTFORD PRO
GLOBAL LEADERS GROWTH FORMA
FUND PORTFOLIO COMBINED
-------------- ------------- ------------
Net Assets (in thousands)............................. $ 421,549 $ 110,970 $ 532,519
Net Asset Value Per Share
Class A............................................. $ 12.83 $ 18.76 $ 12.83
Class B............................................. $ 12.54 $ 17.70 $ 12.54
Class C............................................. $ 12.55 $ 17.77 $ 12.55
Class H............................................. $ -- $ 17.70 $ --
Class Y............................................. $ 13.03 $ -- $ 13.03
Shares Outstanding
Class A............................................. 19,262,984 4,351,471 25,625,696
Class B............................................. 5,021,010 631,687 7,075,559
Class C............................................. 8,254,026 202,464 8,540,702
Class H............................................. -- 823,909 --
Class Y............................................. 607,000 -- 607,000
</Table>
40
<Table>
<Caption>
THE HARTFORD FORTIS HARTFORD
GROWTH AND GROWTH & PRO FORMA
INCOME FUND INCOME FUND COMBINED
------------ ----------- -----------
Net Assets (in thousands).............................. $ 343,757 $ 33,920 $ 377,677
Net Asset Value Per Share
Class A.............................................. $ 10.36 $ 12.94 $ 10.36
Class B.............................................. $ 10.10 $ 12.74 $ 10.10
Class C.............................................. $ 10.11 $ 12.74 $ 10.11
Class H.............................................. $ -- $ 12.75 $ --
Class Y.............................................. $ 10.52 $ -- $ 10.52
Shares Outstanding
Class A.............................................. 23,146,033 1,553,904 25,086,913
Class B.............................................. 4,276,016 528,563 5,454,224
Class C.............................................. 5,974,996 150,502 6,164,649
Class H.............................................. -- 405,177 --
Class Y.............................................. 42,000 -- 42,000
</Table>
<Table>
<Caption>
THE HARTFORD FORTIS HIGH HARTFORD
HIGH YIELD YIELD PRO FORMA
FUND PORTFOLIO COMBINED
------------ ----------- -----------
Net Assets (in thousands)............................. $ 94,503 $ 102,164 $ 196,667
Net Asset Value Per Share
Class A............................................. $ 8.45 $ 4.96 $ 8.45
Class B............................................. $ 8.43 $ 4.97 $ 8.43
Class C............................................. $ 8.43 $ 4.96 $ 8.43
Class H............................................. $ -- $ 4.96 $ --
Class Y............................................. $ 8.48 $ -- $ 8.48
Shares Outstanding
Class A............................................. 5,418,019 12,754,174 12,904,493
Class B............................................. 2,006,998 2,147,217 6,276,866
Class C............................................. 3,273,993 583,456 3,617,284
Class H............................................. -- 5,105,508 --
Class Y............................................. 498,001 -- 498,001
</Table>
41
<Table>
<Caption>
THE HARTFORD FORTIS
INTERNATIONAL INTERNATIONAL HARTFORD
OPPORTUNITIES EQUITY PRO FORMA
FUND PORTFOLIO COMBINED
------------- ------------- ----------
Net Assets (in thousands)............................... $ 126,739 $ 21,523 $ 148,262
Net Asset Value Per Share
Class A............................................... $ 9.33 $ 13.31 $ 9.33
Class B............................................... $ 9.04 $ 13.06 $ 9.04
Class C............................................... $ 8.99 $ 13.06 $ 8.99
Class H............................................... $ -- $ 13.05 $ --
Class Y............................................... $ 9.49 $ -- $ 9.49
Shares Outstanding
Class A............................................... 7,754,975 1,105,649 9,332,273
Class B............................................... 2,080,000 212,933 2,716,739
Class C............................................... 2,060,011 80,378 2,176,778
Class H............................................... -- 227,986 --
Class Y............................................... 1,800,010 -- 1,800,010
</Table>
<Table>
<Caption>
THE HARTFORD HARTFORD
MONEY MARKET FORTIS MONEY PRO FORMA
FUND FUND COMBINED
------------ ------------ ------------
Net Assets (in thousands).......................... $ 222,928 $ 209,701 $ 432,629
Net Asset Value Per Share
Class A.......................................... $ 1.00 $ 1.00 $ 1.00
Class B.......................................... $ 1.00 $ 1.00 $ 1.00
Class C.......................................... $ 1.00 $ 1.00 $ 1.00
Class H.......................................... $ -- $ 1.00 $ --
Class Y.......................................... $ 1.00 $ -- $ 1.00
Shares Outstanding
Class A.......................................... 86,748,000 202,662,473 289,410,473
Class B.......................................... 48,998,000 3,027,374 54,754,055
Class C.......................................... 53,873,000 1,281,979 55,154,979
Class H.......................................... -- 2,728,681 --
Class Y.......................................... 33,309,000 -- 33,309,000
</Table>
42
INFORMATION ABOUT THE HARTFORD FUNDS AND THE FORTIS FUNDS
HARTFORD FUNDS
A discussion of the performance of each of the Hartford Funds (other than
Hartford Money Market Fund) during the fiscal year ended October 31, 2001 is
included in this Prospectus/Proxy Statement as Appendix B. Financial highlights
for the Hartford Funds are included as Appendix C.
Information about the Class A, Class B and Class C shares of each Hartford
Fund is contained in the Hartford Fund's current Class A, Class B and Class C
share Prospectus, each of which is incorporated herein by reference. A copy of
the current Prospectus of the Hartford Fund for which your Fortis Fund shares
will be exchanged is included with this Prospectus/Proxy Statement. Additional
information about each Hartford Fund is included in that Fund's Statement of
Additional Information, and the Statement of Additional Information dated
December , 2001 (relating to this Prospectus/Proxy Statement), each of which
is incorporated herein by reference. Copies of the Statements of Additional
Information, which have been filed with the Securities and Exchange Commission
(the "SEC"), may be obtained upon request and without charge by calling or
writing the Hartford Funds at:
The Hartford Mutual Funds, Inc.
P.O. Box 64387
St. Paul, Minnesota 55164-0387
1-888-843-7824
The Hartford Funds are subject to the informational requirements of the
Securities Act of 1933, as amended (the "1933 Act"), the Securities Exchange Act
of 1934, as amended (the "1934 Act"), and the 1940 Act and file reports and
other information with the SEC under those Acts. Reports, proxy and information
statements, charter documents and other information filed by the Hartford Funds
can be obtained by calling or writing the Hartford Funds and can also be
inspected and copied by the public at the following locations of the SEC:
<Table>
Public Reference Room Midwest Regional Office
450 Fifth Street, N.W. Citicorp Center, Suite 1400
Room 1024 500 West Madison Street
Washington, D.C. 20549 Chicago, Illinois 60661
</Table>
Copies of the information also may be obtained by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington D.C.
20549, at prescribed rates. Further information on the operations of the public
reference facilities may be obtained by calling 1-800-SEC-0330. In addition, the
SEC maintains an Internet site that contains copies of the information. The
address of the site is http://www.sec.gov.
FORTIS FUNDS
Information about the Fortis Funds is contained in each Fortis Fund's
current Prospectus, Annual Report to Shareholders, subsequent Semiannual Report
to Shareholders (if any), Statement of Additional Information, and the Statement
of Additional Information dated December , 2001 (relating to this
Prospectus/Proxy Statement), each of which is incorporated herein by reference.
Copies of such Prospectuses, Annual and Semiannual Reports, and Statements of
Additional Information, which have been filed with the SEC, may be obtained upon
request and without charge from the Fortis Funds by calling or writing the
Fortis Funds at:
Fortis Funds
P.O. Box 64387
St. Paul, Minnesota 55164-0387
1-800-800-2000, extension 3012
The Fortis Funds are subject to the informational requirements of the 1933
Act, the 1934 Act and the 1940 Act and in accordance therewith file reports and
other information with the SEC. Reports, proxy and
43
information statements, charter documents and other information filed by the
Fortis Funds can be obtained by calling or writing the Fortis Funds and can also
be inspected at the public reference facilities maintained by the SEC or
obtained at prescribed rates at the addresses listed in the previous section or
from the SEC's Internet site at http://www.sec.gov.
VOTING INFORMATION
This Prospectus/Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of the Fortis Funds of proxies for use at
the Special Meeting of Shareholders (the "Special Meeting") to be held on
January 31, 2002, at 10:00 a.m., Central Time at 500 Bielenberg Drive, Woodbury,
Minnesota 55125, and at any adjournments thereof. The proxy confers
discretionary authority on the persons designated therein to vote on other
business not currently contemplated which may properly come before the Special
Meeting. A proxy, if properly executed, duly returned and not revoked, will be
voted in accordance with the specifications thereon; if no instructions are
given, such proxy will be voted in favor of the Plan. A shareholder may revoke a
proxy at any time prior to use by filing with the Secretary of the Fortis Funds
an instrument revoking the proxy, by submitting a proxy bearing a later date or
by attending and voting at the Special Meeting.
The cost of the solicitation, including the printing and mailing of proxy
materials, will be borne by Hartford Life or the applicable Hartford Funds. In
addition to solicitations through the mails, proxies may be solicited by
officers, employees and agents of Hartford Administrative Services Company or
Hartford Life. Such solicitations may be by telephone, telegraph or personal
contact. Hartford Administrative Services Company or Hartford Life may also
arrange for an outside firm, Georgeson Shareholder, to solicit shareholder votes
by telephone of the Fortis Funds' behalf. The services provided by Georgeson
Shareholder are expected to cost approximately $137,300. If votes are recorded
by telephone, Georgeson Shareholder will use procedures designed to authenticate
shareholders' identities, to allow shareholders to authorize the voting of their
shares in accordance with their instructions, and to confirm that a
shareholder's instructions have been properly recorded.
You may vote by completing and signing the enclosed proxy card(s) and
mailing them in the enclosed postage paid envelope. You may also vote your
shares by phone at 1-888-221-0697. Internet voting is also available at
www.proxyweb.com. Instructions for voting by phone or internet are on your proxy
card.
44
OUTSTANDING SHARES AND VOTING REQUIREMENTS
The Board of Directors of the Fortis Funds has fixed the close of business
on December 11, 2001, as the record date for the determination of shareholders
of the Fortis Funds entitled to notice of and to vote at the Special Meeting and
any adjournments thereof. Each share of a Fortis Fund is entitled to one vote
and fractional shares have proportionate voting rights. Only shareholders of
record as of the record date are entitled to vote on the proposal. As of the
record date, each of the Fortis Funds had the number of shares of different
classes issued and outstanding listed below:
<Table>
<Caption>
FUND NAME TOTAL SHARES OUTSTANDING
- --------- ------------------------
Fortis Asset Allocation Portfolio
Fortis Asset Allocation Portfolio-Class A................. 10,701,298
Fortis Asset Allocation Portfolio-Class B................. 1,664,417
Fortis Asset Allocation Portfolio-Class C................. 751,950
Fortis Asset Allocation Portfolio-Class H................. 2,551,598
Fortis Asset Allocation Portfolio-Class Z................. 158,130
Fortis Global Growth Portfolio
Fortis Global Growth Portfolio-Class A.................... 4,954,170
Fortis Global Growth Portfolio-Class B.................... 716,714
Fortis Global Growth Portfolio-Class C.................... 215,960
Fortis Global Growth Portfolio-Class H.................... 931,263
Fortis Growth & Income Fund
Fortis Growth & Income Fund-Class A....................... 1,682,128
Fortis Growth & Income Fund-Class B....................... 562,600
Fortis Growth & Income Fund-Class C....................... 161,430
Fortis Growth & Income Fund-Class H....................... 429,591
Fortis High Yield Portfolio
Fortis High Yield Portfolio-Class A....................... 9,472,463
Fortis High Yield Portfolio-Class B....................... 2,070,965
Fortis High Yield Portfolio-Class C....................... 582,793
Fortis High Yield Portfolio-Class H....................... 5,053,930
Fortis International Equity Portfolio
Fortis International Equity Portfolio-Class A............. 956,219
Fortis International Equity Portfolio-Class B............. 214,203
Fortis International Equity Portfolio-Class C............. 66,744
Fortis International Equity Portfolio-Class H............. 235,799
Fortis Money Fund
Fortis Money Fund-Class A................................. 195,371,313
Fortis Money Fund-Class B................................. 2,912,273
Fortis Money Fund-Class C................................. 1,262,470
Fortis Money Fund-Class H................................. 2,819,135
</Table>
45
On the record date, the Directors and officers of each Fortis Fund as a
group owned less than 1% of the outstanding shares of each Fortis Fund. To the
best knowledge of each Fortis Fund, as of the record date, no person, except as
set forth in the table below, owned beneficially or of record 5% or more of the
outstanding shares of any class of a Fortis Fund.
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
Fortis Asset Allocation
Portfolio-Class Z Vanguard Fiduciary Trust Co. 143,407.88 90%
FBO Fortis 401(k) Plan #90895
PO Box 2600
Valley Forge, PA
Fortis International Equity
Portfolio-Class A Mitra & Co. 49,307.06 5%
1000 N Water St, Fl 14
Milwaukee, WI
Fortis International Equity
Portfolio-Class C US Bank, N.A. C/F 5,702.05 8%
Dolores F. Posey IRA
RR 5 Box 76B
Fairmont, WV
Donaldson Lufkin Jenrette Securities 3,760.15 5%
Corporation, Inc.
PO Box 2052
Jersey City, NJ
Fortis International Equity
Portfolio-Class H US Bank, N.A. C/F 13,603.97 5%
M. Judy Wardle R/O IRA
1300 Country Club Dr
Findlay, OH
Fortis Money Fund-Class B Salomon Smith Barney, Inc. 173,833.35 5%
333 W 34th St, 3rd Fl
New York, NY
Fortis Money Fund-Class C US Bank, N.A. C/F 258,698.20 21%
Donald A. Pulice R/O IRA
2024 Henderson Ave
Clarksburg, WV
US Bank, N.A. C/F 198,460.54 16%
Robert E. Phillips R/O IRA
4025 Fairmont Rd
Morgantown, WV
US Bank, N.A. C/F 197,118.59 16%
Robert F. Matz IRA
68 Wilson Ave
Morgantown, WV
Harlan L. & Madeline J. Bahr JTWROS 139,463.16 11%
344 N 5th St
New Strawn, KS
</Table>
46
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
US Bank, N.A. C/F 92,156.05 7%
Kenneth C. Brand Jr. IRA
RR 7 Box 208
Fairmont, WV
US Bank, N.A. C/F Mississippi 64,675.75 5%
State University TDI FBO
Melissa J. Mixon
102 Laurel Hill Dr
Starkville, MS
Fortis Money Fund-Class H Catherine J. Childers 462,860.62 16%
5404 San Jose Blvd
Jacksonville, FL
US Bank Piper Jaffray C/F 141,334.21 5%
John D. Jeffries IRA
800 Nicollet Mall
Minneapolis, MN
</Table>
On the record date, the Directors and officers of each Hartford Fund as a
group owned less than 1% of the outstanding shares of each Hartford Fund. To the
best knowledge of the Hartford Funds, as of the record date, no person, except
as set forth in the table below, owned beneficially or of record 5% or more of
the outstanding shares of any Hartford Fund.
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
The Hartford Advisers Fund-
Class A Edward D. Jones & Co. 52,814,706.82 68%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Advisers Fund-
Class B Edward D. Jones & Co. 8,446,498.49 19%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Advisers Fund-
Class C Edward D. Jones & Co. 3,813,487.37 11%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Advisers Fund-
Class Y Natalie Delemar Acct Admin 3,795,915.90 97%
Bankers Trust Co. TTEE ITT
Hartford Invest & Savings Plan
Dtd 12/19/95
34 Exchange Place, MS 3048
Jersey City, NJ
</Table>
47
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
The Hartford Global Leaders
Fund-Class A Edward D. Jones & Co. 12,928,193.11 68%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Global Leaders
Fund-Class B Edward D. Jones & Co. 1,356,297.51 27%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Global Leaders
Fund-Class C Edward D. Jones & Co. 962,537.654 11%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Global Leaders
Fund-Class Y Natalie Delemar Acct Admin 623,287.46 100%
Bankers Trust Co. TTEE ITT
Hartford Invest & Savings Plan
Dtd 12/19/95
34 Exchange Place, MS 3048
Jersey City, NJ
The Hartford Growth and
Income Fund-Class A Edward D. Jones & Co. 20,042,807.52 83%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Growth and
Income Fund-Class B Edward D. Jones & Co. 2,102,385.45 48%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Growth and
Income Fund-Class C Edward D. Jones & Co. 1,451,978.42 23%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Growth and
Income Fund-Class Y HL Investment Advisors 31,811.91 75%
Attn: Greg Bubnash
PO Box 2999, Wing A-3
Hartford, CT
The Hartford High Yield Fund-
Class A Edward D. Jones & Co. 3,488,813.42 57%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
</Table>
48
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
HL Investment Advisors 342,751.25 5%
Attn: Greg Bubnash
PO Box 2999, Wing A-3
Hartford, CT
The Hartford High Yield Fund-
Class B Edward D. Jones & Co. 436,354.87 19%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
HL Investment Advisors 126,555.78 5%
Attn: Greg Bubnash
PO Box 2999, Wing A-3
Hartford, CT
The Hartford High Yield Fund-
Class C Edward D. Jones & Co. 259,896.88 7%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford High Yield Fund-
Class Y Natalie Delemar Acct Admin 396,292.71 75%
Bankers Trust Co. TTEE ITT
Hartford Invest & Savings Plan
Dtd 12/19/95
34 Exchange Place, MS 3048e
Jersey City, NJ
HL Investment Advisors 130,627.45 24%
Attn: Greg Bubnash
PO Box 2999, Wing A-3
Hartford, CT
The Hartford International
Opportunities Fund-Class A Edward D. Jones & Co. 5,101,534.02 70%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford International
Opportunities Fund-Class B Edward D. Jones & Co. 524,691.16 25%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford International
Opportunities Fund-Class C Edward D. Jones & Co. 247,250.38 12%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
</Table>
49
<Table>
<Caption>
NAME OF FUND AND PERCENT OF
CLASS NAME AND ADDRESS OF RECORD OWNER SHARES OWNED CLASS
- ---------------- ------------------------------------ ------------ ----------
The Hartford International
Opportunities Fund-Class Y Natalie Delemar Acct Admin 1,294,273.81 70%
Bankers Trust Co. TTEE ITT
Hartford Invest & Savings Plan
Dtd 12/19/95
34 Exchange Place, MS 3048
Jersey City, NJ
Saxon & Co. FBO 257,592.18 14%
20-42-002-3500639
PO Box 7780-1888
Philadelphia, PA
Hartford Life Insurance Co. C/O 201,392.66 11%
Greg Bubnash A3 East
200 Hopmeadow St
Simsbury, CT
The Hartford Money Market
Fund-Class A Edward D. Jones & Co. 12,937,618.63 13%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Money Market
Fund-Class B Edward D. Jones & Co. 3,404,468.07 7%
FBO its customers
201 Progress Pkwy
Maryland Heights, MO
The Hartford Money Market
Fund-Class Y Natalie Delemar Acct Admin 31,961,767.62 96%
Bankers Trust Co. TTEE ITT
Hartford Invest & Savings Plan
Dtd 12/19/95
34 Exchange Place, MS 3048
Jersey City, NJ
</Table>
Assuming a quorum is present, approval of the Plan with respect to a Fortis
Fund requires the affirmative vote, in person or by proxy, of a majority of the
votes cast at the meeting, with all classes of a Fund voting together. Under
Maryland law, Fortis Fund shareholders are not entitled to assert dissenters'
rights of appraisal in connection with the Reorganization. In the event that
shareholders of one or more of the Fortis Funds do not approve the Plan, the
Reorganization will proceed with respect to those Fortis Funds that have
approved the Plan, subject to certain other conditions being met. The votes of
shareholders of the Hartford Funds are not being solicited since their approval
is not required in order to effect the Reorganization.
Each Fortis Fund will vote separately on the proposal. In order for the
shareholder meeting to go forward for a Fortis Fund, there must be a quorum.
This means that a majority of that Fund's shares must be represented at the
meeting -- either in person or by proxy. All returned proxies count toward a
quorum, regardless of how they are voted. An abstention will be counted as a
vote cast at the meeting in determining whether the proposal has been approved,
and will have the same effect as a vote "against" the proposal. Broker
non-votes, although counted toward a quorum, will not be counted as cast in
calculating the vote on the proposal and will therefore have no effect on the
vote. (Broker non-votes are shares for which (a) the underlying owner has not
voted and (b) the broker holding the shares does not have
50
discretionary authority to vote on the particular matter.) If you sign and date
your proxy, but do not specify instructions, your shares will be voted in favor
of the proposal.
If a quorum is not obtained for any Fortis Fund or if sufficient votes to
approve the proposal are not received, the persons named as proxies may propose
one or more adjournments of the meeting for that Fund to permit further
solicitation of proxies. Any adjournment will require a vote in favor of the
adjournment by the holders of a majority of the shares present in person or by
proxy at the meeting (or any adjournment of the meeting).
OTHER MATTERS
Management of the Fortis Funds knows of no other matters that may properly
be, or which are likely to be, brought before the Special Meeting. However, if
any other business shall properly come before the Special Meeting, the persons
named in the proxy intend to vote thereon in accordance with their best
judgment.
BOARD RECOMMENDATION
After carefully considering the issues involved, the Board of Directors of
the Fortis Funds has unanimously concluded that the proposed Reorganization is
in the best interests of shareholders. The Board of Directors of the Fortis
Funds recommends that you vote to approve the Plan. Whether or not shareholders
expect to attend the Special Meeting, all shareholders are urged to promptly
sign, fill in and return the enclosed proxy form or vote by toll-free telephone
call or the internet.
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APPENDIX A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is made as of
, 2001, between The Hartford Mutual Funds, Inc., a Maryland
corporation ("Hartford"), on behalf of each segregated portfolio of assets
thereof ("series") listed on Schedule A to this Agreement ("Schedule A") (each,
an "Acquiring Fund"), and Hartford-Fortis Series Fund, Inc., a Maryland
corporation ("Fortis"), on behalf of each series thereof listed on Schedule A
(each, a "Target Fund"). (Each Acquiring Fund and Target Fund is sometimes
referred to herein individually as a "Fund" and collectively as the "Funds," and
Hartford and Fortis are sometimes referred to herein individually as an
"Investment Company" and collectively as the "Investment Companies.") All
agreements, representations and warranties, actions, and obligations described
herein made or to be taken or undertaken by a Fund are made and shall be taken
or undertaken by Hartford on behalf of each Acquiring Fund and by Fortis on
behalf of each Target Fund.
The Investment Companies wish to effect six separate reorganizations, each
described in section 368(a)(1) of the Internal Revenue Code of 1986, as amended
("Code"), and intend this Agreement to be, and adopt it as, a "plan of
reorganization" within the meaning of the regulations under section 368 of the
Code ("Regulations"). Target Fund and Acquiring Fund each have multiple classes
of shares. Each reorganization will involve the transfer of the assets of a
Target Fund, subject to the liabilities of such Target Fund, to the
corresponding Acquiring Fund listed on Schedule A, in exchange solely for Class
A, Class B and Class C shares of common stock of such Acquiring Fund ("Acquiring
Fund Shares"), followed by the constructive distribution of those shares pro
rata to the holders of shares of the corresponding classes of common stock of
that Target Fund ("Target Fund Shares"),such corresponding classes being set
forth on Schedule A hereto, all on the terms and conditions set forth herein.
(All such transactions involving each Target Fund and its corresponding
Acquiring Fund are referred to herein as a "Reorganization.") For convenience,
the balance of this Agreement refers only to a single Reorganization, one
Acquiring Fund, and one Target Fund, but the provisions of this Agreement shall
apply separately to each Reorganization. The consummation of one Reorganization
shall not be contingent on the consummation of any other Reorganization.
In consideration of the mutual promises contained herein, the parties agree
as follows:
1. PLAN OF REORGANIZATION
1.1. Subject to the requisite approval by Target Fund shareholders and to
the other terms and conditions set forth herein and on the basis of the
representations and warranties contained herein, Target Fund agrees to assign,
sell, convey, transfer, and deliver all of its assets described in paragraph 1.2
("Assets") to Acquiring Fund and Acquiring Fund agrees in exchange therefor (a)
to assume all of the liabilities of Target Fund described in paragraph 1.3
("Liabilities"), and (b) to issue and deliver to Target Fund the number of full
and fractional (rounded to the third decimal place) Acquiring Fund Shares of
each specified class determined by dividing the value of the Assets attributable
to the corresponding class of Target Fund Shares less the Liabilities
attributable to such Target Fund Shares by the net asset value ("NAV") of an
Acquiring Fund Share of such class (both computed as set forth in paragraph
2.1). Such transactions shall take place at the Closing (as defined in paragraph
3.1).
1.2. The Assets shall include all cash, cash equivalents, securities,
receivables (including interest and dividends receivable), claims and rights of
action, rights to register shares under applicable securities laws, books and
records, deferred and prepaid expenses shown as assets on Target Fund's books,
and other property owned by Target Fund at the Effective Time (as defined in
paragraph 3.1).
1.3. The Liabilities shall include all liabilities, debts, obligations,
and duties of whatever kind or nature of the Target Fund at the Effective Time,
whether absolute, accrued, contingent, or otherwise, whether or not arising in
the ordinary course of business, and whether or not specifically referred to in
this Agreement, including any obligation to indemnify the directors of Fortis,
acting in their capacities as such,
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to the fullest extent permitted by law and the amended and restated articles of
incorporation ("Articles of Incorporation") and bylaws of Fortis (collectively
"Liabilities").
1.4. At or immediately before the Effective Time, Target Fund shall
declare and pay to its shareholders a dividend and/or other distribution in an
amount large enough so that it will have distributed all of its investment
company taxable income (as defined in section 852(b)(2) of the Code but computed
without regard to any deduction for dividends paid) and substantially all of its
net capital gain (as defined in section 852(b)(3) of the Code, but computed
without regard to any deduction for capital gain dividends) for the current
taxable year through the Effective Time.
1.5. At the Effective Time (or as soon thereafter as is reasonably
practicable), Target Fund shall distribute the Acquiring Fund Shares it receives
pursuant to paragraph 1.1 to Target Fund's shareholders of record, determined as
of the Effective Time (each, a "Shareholder"), in constructive exchange for
their Target Fund Shares. Such distribution shall be accomplished by Hartford's
transfer agent's opening accounts on Acquiring Fund's share transfer books in
the Shareholders' names and transferring such Acquiring Fund Shares thereto.
Each Shareholder's account shall be credited with the respective pro rata number
of full and fractional (rounded to the third decimal place) Acquiring Fund
Shares of the appropriate class due that Shareholder. All outstanding Target
Fund Shares, including any represented by certificates, shall simultaneously be
canceled on Target Fund's share transfer books. Acquiring Fund shall not issue
certificates representing the Acquiring Fund Shares issued in connection with
the Reorganization.
1.6. No front-end sales charges will be incurred by Target Fund
shareholders in connection with their acquisition of Acquiring Fund Shares
pursuant to this Agreement. In addition, in determining contingent deferred
sales charges applicable to any Acquiring Fund Shares distributed in the
Reorganization and in determining the date upon which any Class B Acquiring Fund
Shares distributed in the Reorganization convert to Class A Acquiring Fund
Shares, credit shall be given for the period during which the holders thereof
held the Target Fund Shares in exchange for which such Acquiring Fund Shares
were issued.
1.7. As soon as reasonably practicable after distribution of the Acquiring
Fund Shares pursuant to paragraph 1.5, Fortis shall wind up the affairs of
Target Fund and shall file any required final regulatory reports, including but
not limited to any Form N-SAR and Rule 24f-2 filings with respect to Target
Fund.
1.8. Any transfer taxes payable on issuance of Acquiring Fund Shares in a
name other than that of the registered holder on Target Fund's books of the
Target Fund Shares constructively exchanged therefor shall be paid by the person
to whom such Acquiring Fund Shares are to be issued, as a condition of such
transfer.
2. VALUATION
2.1. For purposes of paragraph 1.1(b), the value of the Assets and the
Liabilities and the NAV of an Acquiring Fund Share shall be computed as of the
close of business on the date of the Closing ("Valuation Time"). The NAV of an
Acquiring Fund Share shall be computed using the valuation procedures set forth
in the Acquiring Fund's then current prospectus and statement of additional
information ("SAI"). The value of the Assets and Liabilities shall be computed
using the valuation procedures set forth in the Target Fund's then current
prospectus and SAI, subject to adjustment by the amount, if any, agreed to by
Hartford and Fortis. Hartford and Fortis agree to use all commercially
reasonable efforts to resolve any material differences between the value of the
Assets and Liabilities determined in accordance with the valuation procedures of
the Target Fund and the value of the Assets and Liabilities determined in
accordance with the valuation procedures of the Acquiring Fund prior to the
Valuation Time.
2.2. All computations pursuant to paragraph 2.1 shall be made by or under
the direction of Hartford Administrative Services Company.
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3. CLOSING AND EFFECTIVE TIME
3.1. The Reorganization, together with related acts necessary to
consummate the same ("Closing"), shall occur at the offices of Dorsey & Whitney
LLP, 50 South Sixth Street, Minneapolis, Minnesota 55402, on or about
, 2002, or at such other place and/or on such other date as to which
the Investment Companies may agree. All acts taking place at the Closing shall
be deemed to take place simultaneously as of the close of business on the date
thereof or at such other time as to which the Investment Companies may agree
("Effective Time"). If, immediately before the Valuation Time, (a) the New York
Stock Exchange is closed to trading or trading thereon is restricted or (b)
trading or the reporting of trading on that exchange or elsewhere is disrupted,
so that accurate appraisal of the value of the Assets and Liabilities and the
NAV of an Acquiring Fund Share is impracticable, the Effective Time shall be
postponed until the first business day after the day when such trading has fully
resumed and such reporting has been restored.
3.2. Fortis shall deliver to Hartford at the Closing a schedule of the
Assets and Liabilities as of the Effective Time, which shall set forth for all
portfolio securities included therein and all other Assets, their adjusted basis
and holding period, by lot, for federal income tax purposes. Fortis' custodian
shall deliver at the Closing a certificate of an authorized officer stating that
(a) the Assets held by the custodian will be transferred to Acquiring Fund at
the Effective Time and (b) all necessary taxes in conjunction with the delivery
of the Assets, including all applicable federal and state stock transfer stamps,
if any, have been paid or provision for payment has been made.
3.3. Fortis' transfer agent shall deliver to Hartford at the Closing a
statement of an authorized officer thereof certifying that its records contain
the names and addresses of the Shareholders and the number and percentage
ownership of outstanding Target Fund Shares of each class owned by each
Shareholder, all as of the Effective Time. Hartford's transfer agent shall
deliver at the Closing a certificate as to the opening on Acquiring Fund's share
transfer books of accounts in the Shareholders' names. Hartford shall issue and
deliver a confirmation to Fortis evidencing the Acquiring Fund Shares of each
class to be credited to Target Fund at the Effective Time or provide evidence
satisfactory to Fortis that such Acquiring Fund Shares have been credited to
Target Fund's account on Acquiring Fund's books. At the Closing, each Investment
Company shall deliver to the other bills of sale, checks, assignments, stock
certificates, receipts, or other documents the other Investment Company or its
counsel reasonably requests.
3.4. Each Investment Company shall deliver to the other at the Closing a
certificate executed in its name by its President or a Vice President in form
and substance satisfactory to the recipient and dated the Effective Time, to the
effect that the representations and warranties it made in this Agreement are
true and correct at the Effective Time except as they may be affected by the
transactions contemplated by this Agreement.
4. REPRESENTATIONS AND WARRANTIES
4.1. Fortis represents and warrants as follows:
4.1.1. Fortis is a corporation that is duly organized, validly
existing, and in good standing under the laws of the State of Maryland; and
its Articles of Incorporation are on file with the Secretary of the State
of Maryland;
4.1.2. Fortis is duly registered as an open-end management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"),
and such registration is in full force and effect;
4.1.3. Target Fund is a duly established and designated series of
Fortis; and all Target Fund Shares outstanding at the Effective Time will
have been duly authorized and duly and validly issued and outstanding
shares of Target Fund, fully paid and non-assessable;
4.1.4. At the Closing, Target Fund will have good and marketable
title to the Assets and full right, power, and authority to sell, assign,
transfer, and deliver the Assets free of any liens or other
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encumbrances; and on delivery and payment for the Assets, Acquiring Fund
will acquire good and marketable title thereto;
4.1.5. Target Fund's current prospectus and SAI conform in all
material respects to the applicable requirements of the Securities Act of
1933, as amended ("1933 Act"), and the 1940 Act and the rules and
regulations thereunder and do not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
4.1.6. Target Fund is not in violation of, and the execution and
delivery of this Agreement and consummation of the transactions
contemplated hereby will not conflict with or violate, applicable law or
any provision of Fortis' Articles of Incorporation or By-Laws or of any
agreement, instrument, lease, or other undertaking to which Target Fund is
a party or by which it is bound or result in the acceleration of any
obligation, or the imposition of any penalty, under any agreement,
judgment, or decree to which Target Fund is a party or by which it is
bound, except as previously disclosed in writing to and accepted by
Hartford;
4.1.7. Except as otherwise disclosed in writing to and accepted by
Hartford, all material contracts and other commitments of or applicable to
Target Fund (other than this Agreement and investment contracts, including
options, futures, and forward contracts) will be terminated, or provision
for discharge of any liabilities of Target Fund thereunder will be made, at
or prior to the Effective Time, without either Fund's incurring any
liability or penalty with respect thereto and without diminishing or
releasing any rights Target Fund may have had with respect to actions taken
or omitted or to be taken by any other party thereto prior to the Closing;
4.1.8. Except as otherwise disclosed in writing to and accepted by
Hartford, no litigation, administrative proceeding, or investigation of or
before any court or governmental body is presently pending or (to Fortis'
knowledge) threatened against Fortis or any of its properties or assets
that, if adversely determined, would materially and adversely affect Target
Fund's financial condition or the conduct of its business; and Fortis knows
of no facts that might form the basis for the institution of any such
litigation, proceeding, or investigation and is not a party to or subject
to the provisions of any order, decree, or judgment of any court or
governmental body that materially or adversely affects its business or its
ability to consummate the transactions contemplated hereby;
4.1.9. The execution, delivery, and performance of this Agreement
have been duly authorized as of the date hereof by all necessary action on
the part of Fortis' board of directors; and, subject to approval by Target
Fund's shareholders, this Agreement constitutes a valid and legally binding
obligation of Target Fund, enforceable in accordance with its terms, except
as the same may be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium, and similar laws relating to or affecting
creditors' rights and by general principles of equity;
4.1.10. At the Effective Time, the performance of this Agreement
shall have been duly authorized by all necessary action by Target Fund's
shareholders;
4.1.11. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the Securities Exchange Act of
1934, as amended ("1934 Act"), the 1940 Act, or applicable state securities
laws for the execution or performance of this Agreement by Fortis, except
for (a) the filing with the Securities and Exchange Commission ("SEC") of a
registration statement by Hartford on Form N-14 relating to the Acquiring
Fund Shares issuable hereunder, and any supplement or amendment thereto
("Registration Statement"), including therein a prospectus/proxy statement
("Proxy Statement"), and (b) such consents, approvals, authorizations, and
filings as have been made or received or as may be required subsequent to
the Effective Time;
4.1.12. On the effective date of the Registration Statement, at the
time of the shareholders' meeting referred to in paragraph 5.2, and at the
Effective Time, the Proxy Statement will (a) comply in all material
respects with the applicable provisions of the 1933 Act, the 1934 Act, and
the 1940 Act and the rules and regulations thereunder and (b) not contain
any untrue statement of a
A-4
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not misleading;
provided that the foregoing shall not apply to statements in or omissions
from the Proxy Statement made in reliance on and in conformity with
information furnished by Hartford for use therein;
4.1.13. There are no Liabilities other than Liabilities disclosed or
provided for in Fortis' financial statements referred to in paragraph
4.1.19 and Liabilities incurred by Target Fund in the ordinary course of
its business subsequent to July 31, 2001 for the Fortis High Yield
Portfolio, August 31, 2001 for the Fortis Asset Allocation Portfolio and
the Fortis Growth & Income Fund, September 30, 2001 for the Fortis Money
Fund, and October 31, 2001 for the Fortis Global Growth Portfolio and the
Fortis International Equity Portfolio, or otherwise previously disclosed to
Hartford, none of which has been materially adverse to the business,
assets, or results of Target Fund's operations;
4.1.14. Target Fund is a "fund" as defined in section 851(g)(2) of the
Code; it qualified for treatment as a regulated investment company under
Subchapter M of the Code ("RIC") for each past taxable year since it
commenced operations and will continue to meet all the requirements for
such qualification for its current taxable year; the Assets will be
invested at all times through the Effective Time in a manner that ensures
compliance with the foregoing; and Target Fund has no earnings and profits
accumulated in any taxable year in which the provisions of Subchapter M did
not apply to it;
4.1.15. Target Fund's federal income tax returns, and all applicable
state and local tax returns, for all taxable years through and including
the taxable year ended July 31, 2000 for the Fortis High Yield Portfolio,
August 31, 2000 for the Fortis Asset Allocation Portfolio and the Fortis
Growth & Income Fund, September 30, 2000 for the Fortis Money Fund, and
October 31, 2000 for the Fortis Global Growth Portfolio and the Fortis
International Equity Portfolio have been timely filed and all taxes payable
pursuant to such returns have been timely paid; and
4.1.16. Fortis' financial statements for the year ended July 31, 2001
for the Fortis High Yield Portfolio, August 31, 2001 for the Fortis Asset
Allocation Portfolio and the Fortis Growth & Income Fund, September 30,
2001 for the Fortis Money Fund, and October 31, 2001 for the Fortis Global
Growth Portfolio and the Fortis International Equity Portfolio to be
delivered to Hartford, fairly represent Target Fund's financial position as
of such date and the results of its operations and changes in its net
assets for the period then ended.
4.2. Hartford represents and warrants as follows:
4.2.1. Hartford is a corporation that is duly organized, validly
existing, and in good standing under the laws of the State of Maryland; and
its articles of incorporation ("Articles of Incorporation") are on file
with the Secretary of the State of Maryland;
4.2.2. Hartford is duly registered as an open-end management
investment company under the 1940 Act, and such registration will be in
full force and effect at the Effective Time;
4.2.3. Acquiring Fund is a duly established and designated series of
Hartford;
4.2.4. No consideration other than Acquiring Fund Shares will be
issued in exchange for the Assets in the Reorganization;
4.2.5. The Acquiring Fund Shares to be issued and delivered to Target
Fund hereunder will, at the Effective Time, have been duly authorized and,
when issued and delivered as provided herein, will be duly and validly
issued and outstanding shares of Acquiring Fund, fully paid and
non-assessable;
4.2.6. Acquiring Fund's current prospectus and SAI conform in all
material respects to the applicable requirements of the 1933 Act and the
1940 Act and the rules and regulations thereunder and do not include any
untrue statement of a material fact or omit to state any material fact
required
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to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading;
4.2.7. Acquiring Fund is not in violation of, and the execution and
delivery of this Agreement and consummation of the transactions
contemplated hereby will not conflict with or violate, applicable law or
any provision of Hartford's Articles of Incorporation or By-Laws or of any
provision of any agreement, instrument, lease, or other undertaking to
which Acquiring Fund is a party or by which it is bound or result in the
acceleration of any obligation, or the imposition of any penalty, under any
agreement, judgment, or decree to which Acquiring Fund is a party or by
which it is bound, except as previously disclosed in writing to and
accepted by Fortis;
4.2.8. Except as otherwise disclosed in writing to and accepted by
Fortis, no litigation, administrative proceeding, or investigation of or
before any court or governmental body is presently pending or (to
Hartford's knowledge) threatened against Hartford or any of its properties
or assets that, if adversely determined, would materially and adversely
affect Acquiring Fund's financial condition or the conduct of its business;
and Hartford knows of no facts that might form the basis for the
institution of any such litigation, proceeding, or investigation and is not
a party to or subject to the provisions of any order, decree, or judgment
of any court or governmental body that materially or adversely affects its
business or its ability to consummate the transactions contemplated hereby;
4.2.9. The execution, delivery, and performance of this Agreement have
been duly authorized as of the date hereof by all necessary action on the
part of Hartford's board of directors (together with Fortis' board of
directors, the "Boards"); no approval of this Agreement by Acquiring Fund's
shareholders is required under Hartford's Articles of Incorporation or
By-Laws, or applicable law; and this Agreement constitutes a valid and
legally binding obligation of Acquiring Fund, enforceable in accordance
with its terms, except as the same may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, and similar
laws relating to or affecting creditors' rights and by general principles
of equity;
4.2.10. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the 1934 Act, the 1940 Act, or
applicable state securities laws for the execution or performance of this
Agreement by Hartford, except for (a) the filing with the SEC of the
Registration Statement and (b) such consents, approvals, authorizations,
and filings as have been made or received or as may be required subsequent
to the Effective Time;
4.2.11. On the effective date of the Registration Statement, at the
time of the shareholders' meeting referred to in paragraph 5.2, and at the
Effective Time, the Proxy Statement will (a) comply in all material
respects with the applicable provisions of the 1933 Act, the 1934 Act, and
the 1940 Act and the rules and regulations thereunder and (b) not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which such statements were made, not
misleading; provided that the foregoing shall not apply to statements in or
omissions from the Proxy Statement made in reliance on and in conformity
with information furnished by Fortis for use therein;
4.2.12. Acquiring Fund is a "fund" as defined in section 851(g)(2) of
the Code; it qualified for treatment as a RIC for each past taxable year
since it commenced operations and will continue to meet all the
requirements for such qualification for its current taxable year; Acquiring
Fund intends to continue to meet all such requirements for the next taxable
year; and it has no earnings and profits accumulated in any taxable year in
which the provisions of Subchapter M of the Code did not apply to it;
4.2.13. Acquiring Fund's federal income tax returns, and all
applicable state and local tax returns, for all taxable years through and
including the taxable year ended October 31, 2001 have been timely filed
and all taxes payable pursuant to such returns have been timely paid; and
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4.2.14. Hartford's financial statements for the year ended October 31,
2001 to be delivered to Fortis, fairly represent Acquiring Fund's financial
position as of that date and the results of its operations and changes in
its net assets for the year then ended.
4.3. Each Investment Company represents and warrants as follows:
4.3.1. The fair market value of the Acquiring Fund Shares received by
each Shareholder will be approximately equal to the fair market value of
its Target Fund Shares constructively surrendered in exchange therefor;
4.3.2. The Shareholders will pay their own expenses, if any, incurred
in connection with the Reorganization;
4.3.3. There is no intercompany indebtedness between the Funds that
was issued or acquired, or will be settled, at a discount;
5. COVENANTS
5.1. Each Fund covenants to operate its respective business in the ordinary
course between the date hereof and the Closing, it being understood that such
ordinary course will include declaring and paying customary dividends and other
distributions (including the dividend and/or other distribution referred to in
paragraph 1.4) and changes in operations contemplated by each Fund's normal
business activities.
5.2. Target Fund covenants to call a shareholders' meeting to consider and
act on this Agreement and to take all other action necessary to obtain approval
of the transactions contemplated hereby.
5.3. Target Fund covenants that the Acquiring Fund Shares to be delivered
hereunder are not being acquired for the purpose of making any distribution
thereof, other than in accordance with the terms hereof.
5.4. Target Fund covenants that it will assist Hartford in obtaining
information Hartford reasonably requests concerning the beneficial ownership of
Target Fund Shares.
5.5. Target Fund covenants that its books and records (including all books
and records required to be maintained under the 1940 Act and the rules and
regulations thereunder) will be turned over to Hartford at the Closing.
5.6. Each Fund covenants to cooperate in preparing the Proxy Statement in
compliance with applicable federal and state securities laws.
5.7. Each Fund covenants that it will, from time to time, as and when
requested by the other Fund, execute and deliver or cause to be executed and
delivered all such assignments and other instruments, and will take or cause to
be taken such further action, as the other Fund may deem necessary or desirable
in order to vest in, and confirm to, (a) Acquiring Fund, title to and possession
of all the Assets, and (b) Target Fund, title to and possession of the Acquiring
Fund Shares to be delivered hereunder, and otherwise to carry out the intent and
purpose hereof.
5.8. Acquiring Fund covenants to use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act, and state
securities laws it deems appropriate to continue its operations after the
Effective Time.
5.9. Subject to this Agreement, each Fund covenants to take or cause to be
taken all actions, and to do or cause to be done all things, reasonably
necessary, proper, or advisable to consummate and effectuate the transactions
contemplated hereby.
6. CONDITIONS PRECEDENT
Each Fund's obligations hereunder shall be subject to (a) performance by
the corresponding Fund of all its obligations to be performed hereunder at or
before the Effective Time, (b) all representations and warranties of the
corresponding Fund contained herein being true and correct in all material
respects as of
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the date hereof and, except as they may be affected by the transactions
contemplated hereby, as of the Effective Time, with the same force and effect as
if made at and as of the Effective Time, and (c) the following further
conditions that, at or before the Effective Time:
6.1. This Agreement and the transactions contemplated hereby shall have
been duly adopted and approved by each Board and shall have been approved by
Target Fund's shareholders in accordance with Fortis' Articles of Incorporation
and By-Laws and applicable law.
6.2. All necessary filings shall have been made with the SEC and state
securities authorities, and no order or directive shall have been received that
any other or further action is required to permit the parties to carry out the
transactions contemplated hereby. The Registration Statement shall have become
effective under the 1933 Act, no stop orders suspending the effectiveness
thereof shall have been issued, and the SEC shall not have issued an unfavorable
report with respect to the Reorganization under section 25(b) of the 1940 Act
nor instituted any proceedings seeking to enjoin consummation of the
transactions contemplated hereby under section 25(c) of the 1940 Act. All
consents, orders, and permits of federal, state, and local regulatory
authorities (including the SEC and state securities authorities) deemed
necessary by either Investment Company to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been obtained,
except where failure to obtain same would not involve a risk of a material
adverse effect on either Fund's assets or properties, provided that either
Investment Company may for itself waive any of such conditions.
6.3. At the Effective Time, no action, suit, or other proceeding shall be
pending before any court or governmental agency in which it is sought to
restrain or prohibit, or to obtain damages or other relief in connection with,
the transactions contemplated hereby.
6.4. Fortis shall have received an opinion of Kevin J. Carr, counsel to
Hartford, substantially to the effect that:
6.4.1. Acquiring Fund is a duly established series of Hartford, a
corporation duly organized, validly existing, and in good standing under
the laws of the State of Maryland with power under its Articles of
Incorporation to own all its properties and assets and, to the knowledge of
such counsel, to carry on its business as presently conducted;
6.4.2. This Agreement has been duly authorized, executed, and
delivered by Hartford on behalf of Acquiring Fund; no approval of this
Agreement by Acquiring Fund's shareholders is required under Hartford's
Articles or Incorporation or By-Laws, or applicable law; and assuming due
authorization, execution, and delivery of this Agreement by Fortis on
behalf of Target Fund, this Agreement is a valid and legally binding
obligation of Hartford with respect to Acquiring Fund, enforceable in
accordance with its terms, except as the same may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, and similar
laws relating to or affecting creditors' rights and by general principles
of equity;
6.4.3. The Acquiring Fund Shares to be issued and distributed to the
Shareholders under this Agreement, assuming their due delivery as
contemplated by this Agreement, will be duly authorized, validly issued and
outstanding, and fully paid and non-assessable;
6.4.4. The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not, violate
Hartford's Articles of Incorporation or By-Laws or any provision of any
agreement (known to such counsel, without any independent inquiry or
investigation) to which Hartford (with respect to Acquiring Fund) is a
party or by which it is bound or (to the knowledge of such counsel, without
any independent inquiry or investigation) result in the acceleration of any
obligation, or the imposition of any penalty, under any agreement,
judgment, or decree to which Hartford (with respect to Acquiring Fund) is a
party or by which it is bound, except as set forth in such opinion or as
previously disclosed in writing to and accepted by Fortis;
6.4.5. No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by Hartford (on
behalf of Acquiring Fund) of the transactions
A-8
contemplated herein, except those obtained under the 1933 Act, the 1934
Act, and the 1940 Act and those that may be required under state securities
laws;
6.4.6. Hartford is registered with the SEC as an investment company,
and to the knowledge of such counsel no order has been issued or proceeding
instituted to suspend such registration; and
6.4.7. To the knowledge of such counsel (without any independent
inquiry or investigation), (a) no litigation, administrative proceeding, or
investigation of or before any court or governmental body is pending or
threatened as to Hartford (with respect to Acquiring Fund) or any of its
properties or assets attributable or allocable to Acquiring Fund and (b)
Hartford (with respect to Acquiring Fund) is not a party to or subject to
the provisions of any order, decree, or judgment of any court or
governmental body that materially and adversely affects Acquiring Fund's
business, except as set forth in such opinion or as otherwise disclosed in
writing to and accepted by Fortis.
In rendering such opinion, such counsel may (1) rely, as to matters governed by
the laws of the State of Maryland, on an opinion of competent Maryland counsel,
(2) make assumptions regarding the authenticity, genuineness, and/or conformity
of documents and copies thereof without independent verification thereof, (3)
limit such opinion to applicable federal and state law, and (4) define the word
"knowledge" and related terms to mean the knowledge of attorneys then with such
counsel who have devoted substantive attention to matters directly related to
this Agreement and the Reorganization.
6.5. Hartford shall have received an opinion of Dorsey & Whitney LLP,
counsel to Fortis, substantially to the effect that:
6.5.1. Target Fund is a duly established series of Fortis, a
corporation duly organized, validly existing, and in good standing under
the laws of the State of Maryland with power under its Articles of
Incorporation to own all its properties and assets and, to the knowledge of
such counsel, to carry on its business as presently conducted.;
6.5.2. This Agreement (a) has been duly authorized, executed, and
delivered by Fortis on behalf of Target Fund and (b) assuming due
authorization, execution, and delivery of this Agreement by Hartford on
behalf of Acquiring Fund, is a valid and legally binding obligation of
Fortis with respect to Target Fund, enforceable in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium, and similar laws relating
to or affecting creditors' rights and by general principles of equity;
6.5.3. The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not, violate
Fortis' Articles of Incorporation or By-Laws or any provision of any
agreement (known to such counsel, without any independent inquiry or
investigation) to which Fortis (with respect to Target Fund) is a party or
by which it is bound or (to the knowledge of such counsel, without any
independent inquiry or investigation) result in the acceleration of any
obligation, or the imposition of any penalty, under any agreement,
judgment, or decree to which Fortis (with respect to Target Fund) is a
party or by which it is bound, except as set forth in such opinion or as
previously disclosed in writing to and accepted by Hartford;
6.5.4. No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by Fortis (on
behalf of Target Fund) of the transactions contemplated herein, except
those obtained under the 1933 Act, the 1934 Act, and the 1940 Act and those
that may be required under state securities laws;
6.5.5. Fortis is registered with the SEC as an investment company, and
to the knowledge of such counsel no order has been issued or proceeding
instituted to suspend such registration; and
6.5.6. To the knowledge of such counsel (without any independent
inquiry or investigation), (a) no litigation, administrative proceeding, or
investigation of or before any court or governmental body is pending or
threatened as to Fortis (with respect to Target Fund) or any of its
properties or assets attributable or allocable to Target Fund and (b)
Fortis (with respect to Target Fund) is not a party to or subject to the
provisions of any order, decree, or judgment of any court or governmental
A-9
body that materially and adversely affects Target Fund's business, except
as set forth in such opinion or as otherwise disclosed in writing to and
accepted by Hartford.
In rendering such opinion, such counsel may (1) rely, as to matters
governed by the laws of the State of Maryland, on an opinion of competent
Maryland counsel, (2) make assumptions regarding the authenticity, genuineness,
and/or conformity of documents and copies thereof without independent
verification thereof, (3) limit such opinion to applicable federal and state
law, and (4) define the word "knowledge" and related terms to mean the knowledge
of attorneys then with such counsel who have devoted substantive attention to
matters directly related to this Agreement and the Reorganization.
6.6. Each Investment Company shall have received an opinion of Dorsey &
Whitney LLP, addressed to and in form and substance reasonably satisfactory to
it, as to the federal income tax consequences mentioned below ("Tax Opinion").
In rendering the Tax Opinion, such counsel may rely as to factual matters,
exclusively and without independent verification, on the representations and
warranties made in this Agreement, which such counsel may treat as
representations and warranties made to it, and in separate letters addressed to
such counsel and the certificates delivered pursuant to paragraph 3.4. The Tax
Opinion shall be substantially to the effect that, based on the facts and
assumptions stated therein and conditioned on consummation of the Reorganization
in accordance with this Agreement, for federal income tax purposes:
6.6.1. Acquiring Fund's acquisition of the Assets in exchange solely
for Acquiring Fund Shares, followed by Target Fund's distribution of those
shares pro rata to the Shareholders in exchange for their Target Fund
Shares, will qualify as a reorganization within the meaning of section
368(a)(1) of the Code, and each Fund will be "a party to a reorganization"
within the meaning of section 368(b) of the Code;
6.6.2. Target Fund will recognize no gain or loss on the transfer of
the Assets to Acquiring Fund in exchange solely for Acquiring Fund Shares
or on the subsequent distribution of those shares to the Shareholders in
exchange for their Target Fund Shares;
6.6.3. Acquiring Fund will recognize no gain or loss on its receipt of
the Assets in exchange solely for Acquiring Fund Shares and the assumption
by Acquiring Fund of the liabilities of Target Fund;
6.6.4. Acquiring Fund's basis in the Assets will be the same as Target
Fund's basis therein immediately before the Reorganization, and Acquiring
Fund's holding period for the Assets will include Target Fund's holding
period therefor;
6.6.5. A Shareholder will recognize no gain or loss on the exchange of
all its Target Fund Shares solely for Acquiring Fund Shares pursuant to the
Reorganization. Shareholders subject to taxation will recognize income upon
receipt of any net investment income or net capital gains of Target Fund
which are distributed by Target Fund prior to the Closing;
6.6.6. A Shareholder's aggregate basis in the Acquiring Fund Shares to
be received by it in the Reorganization will be the same as the aggregate
basis in its Target Fund Shares to be constructively surrendered in
exchange for those Acquiring Fund Shares, and its holding period for those
Acquiring Fund Shares will include its holding period for those Target Fund
Shares, provided the Shareholder held them as capital assets at the
Effective Time; and
6.6.7. Acquiring Fund will succeed to and take into account the items
of Target Fund described in Section 381(c) of the Code. Acquiring Fund will
take these items into account subject to the conditions and limitations
specified in Sections 381, 382, 383 and 384 of the Code and the Regulations
thereunder.
Notwithstanding subparagraphs 6.6.2 and 6.6.4, the Tax Opinion may state that no
opinion is expressed as to the effect of the Reorganization on the Funds or any
Shareholder with respect to any asset as to which any unrealized gain or loss is
required to be recognized for federal income tax purposes at the end of a
taxable year (or on the termination or transfer thereof) under a mark-to-market
system of accounting.
A-10
At any time before the Closing, either Investment Company may waive any of
the foregoing conditions (except that set forth in paragraph 6.1) if, in the
judgment of its Board, such waiver will not have a material adverse effect on
its Fund's shareholders' interests.
7. BROKERAGE FEES
Each Investment Company represents and warrants to the other that there are
no brokers or finders entitled to receive any payments in connection with the
transactions provided for herein.
8. EXPENSES; INDEMNIFICATION
8.1 The parties hereto understand and agree that the cost of the
transactions contemplated by this Agreement are being borne by Hartford Life and
Accident Insurance Company and/or its affiliates, to the extent not borne by the
Acquiring Funds.
8.2 The Acquiring Fund agrees to indemnify and hold harmless the Target
Fund and each of the Target Fund's directors and officers from and against any
and all losses, claims, damages, liabilities or expenses (including, without
limitation, the payment of reasonable legal fees and reasonable costs of
investigation) to which, jointly or severally, the Target Fund or any of its
directors or officers may become subject, insofar as any such loss, claim,
damage, liability or expense (or actions with respect thereto) arises out of or
is based on any breach by the Acquiring Fund of any of its representations,
warranties, covenants or agreements set forth in this Agreement.
8.3 The Target Fund agrees to indemnify and hold harmless the Acquiring
Fund and each of the Acquiring Fund's directors and officers from and against
any and all losses, claims, damages, liabilities or expenses (including, without
limitation, the payment of reasonable legal fees and reasonable costs of
investigation) to which, jointly or severally, the Acquiring Fund or any of its
directors or officers may become subject, insofar as any such loss, claim,
damage, liability or expense (or actions with respect thereto) arises out of or
is based on any breach by the Acquired Fund of any of its representations,
warranties, covenants or agreements set forth in this Agreement.
9. ENTIRE AGREEMENT; NO SURVIVAL
Neither party has made any representation, warranty, or covenant not set
forth herein, and this Agreement constitutes the entire agreement between the
parties. The representations, warranties, and covenants contained herein or in
any document delivered pursuant hereto or in connection herewith shall not
survive the Closing.
10. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time at or prior to the Effective
Time, whether before or after approval by Target Fund's shareholders:
10.1. By either Fund (a) in the event of the other Fund's material breach
of any representation, warranty, or covenant contained herein to be performed at
or prior to the Effective Time, (b) if a condition to its obligations has not
been met and it reasonably appears that such condition will not or cannot be
met, or (c) if the Closing has not occurred on or before December 31, 2002; or
10.2. By the parties' mutual agreement.
In the event of termination under paragraphs 10.1(c) or 10.2, there shall
be no liability for damages on the part of either Fund to the other Fund.
11. AMENDMENT
This Agreement may be amended, modified, or supplemented at any time,
notwithstanding approval thereof by Target Fund's shareholders, in any manner
mutually agreed on in writing by the parties; provided that following such
approval no such amendment may have the effect of changing the provisions
A-11
for determining the number of Acquiring Fund shares to be issued to Target Fund
shareholders under this Agreement to the detriment of such shareholders without
their further approval.
12. MISCELLANEOUS
12.1. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Minnesota; provided that, in the case of any
conflict between such laws and the federal securities laws, the latter shall
govern.
12.2. Nothing expressed or implied herein is intended or shall be construed
to confer upon or give any person, firm, trust, or corporation other than the
parties and their respective successors and assigns any rights or remedies under
or by reason of this Agreement.
12.3. This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement, and shall become effective
when one or more counterparts have been executed by each Investment Company and
delivered to the other party hereto. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, each party has caused this Agreement to be executed and
delivered by its duly authorized officers as of the day and year first written
above.
THE HARTFORD MUTUAL FUNDS, INC.
on behalf of its series,
The Hartford Advisers Fund
The Hartford Global Leaders Fund
The Hartford Growth and Income Fund
The Hartford High Yield Fund
The Hartford International
Opportunities Fund
The Hartford Money Market Fund
By:
------------------------------------
Its:
------------------------------------
HARTFORD-FORTIS SERIES FUND, INC.
on behalf of its series,
Fortis Asset Allocation Portfolio
Fortis Global Growth Portfolio
Fortis Growth & Income Fund
Fortis High Yield Portfolio
Fortis International Equity Portfolio
Fortis Money Fund
By:
------------------------------------
Its:
------------------------------------
A-12
SCHEDULE A
<Table>
<Caption>
TARGET FUND/SHARE CLASS CORRESPONDING ACQUIRING FUND/SHARE CLASS
- ----------------------- ----------------------------------------
Fortis Asset Allocation Portfolio The Hartford Advisers Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
- Class Z - Class A
Fortis Global Growth Portfolio The Hartford Global Leaders Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
Fortis Growth & Income Fund Hartford Global and Income Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
Fortis High Yield Portfolio The Hartford High Yield Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
Fortis International Equity Portfolio The Hartford International Opportunities Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
Fortis Money Fund The Hartford Money Market Fund
- Class A - Class A
- Class B - Class B
- Class H - Class B
- Class C - Class C
</Table>
A-13
APPENDIX B
HARTFORD FUND PORTFOLIO MANAGER DISCUSSIONS
Set forth in this Appendix are discussions of the performance of each
Hartford Fund, other than Hartford Money Market Fund, during the fiscal year
ended October 31, 2001.
B-1
The Hartford
Advisers Fund
Portfolio Management Team
[PHOTO OF RAND L. ALEXANDER]
RAND L. ALEXANDER, CFA
Senior Vice President,
Partner & Director of U.S. Core Equities
Wellington Management Company, LLP
[PHOTO OF PAUL D. KAPLAN]
PAUL D. KAPLAN
Senior Vice President,
Partner & Director of Fixed Income
Wellington Management Company, LLP
Performance Overview
7/22/96 - 10/31/01
Growth of a $10,000 investment in
Class A which includes Sales Charge
[LINE GRAPH]
Advisors Fund S&P 500 Lehman Govt/Corp
- ------------- ------- ----------------
9,450 10,000 10,000
10,188 11,198 10,430
11,123 12,845 10,565
12,484 14,790 11,349
14,383 18,118 11,762
14,766 18,044 12,514
16,678 22,070 12,501
16,771 22,674 12,432
17,964 24,054 12,619
18,086 24,054 13,318
16,157 18,087 15,358
RETURNS (Inception 7/22/96)
Standard Non-Standard
ANNUALIZED ANNUALIZED
1 YEAR(1) 5 YEAR(1) SINCE INCEPT.(1) 1 YEAR(2) 5 YEAR(2) SINCE INCEPT.(2)
---------------------------------------- ----------------------------------------
Advisers A -15.58% 8.43% 9.51% -10.67% 9.66% 10.69%
Advisers B -16.27% 8.77% 9.81% -11.27% 8.91% 9.93%
Advisers C* -13.15% 8.53% 9.71% -11.26% 8.89% 9.92%
S&P 500 -24.89% 10.04% 10.68%
Lehman Govt/Corp 15.32% 8.05% 8.47%
The chart represents a hypothetical investment in The Hartford Advisers Fund.
Past performance does not guarantee future results.
The value of shares will fluctuate so that when redeemed, shares may be worth
more or less than their original cost.
(1) The initial investment in Class A and C shares reflects the maximum sales
charge and B shares reflect a CDSC.
(2) Performance results do not reflect sales charge.
* Class C Shares commenced operations on 8/1/98. Performance prior to 8/1/98
reflects Class B performance less Class C sales charges where applicable.
A $10,000 investment in the fund's Class B shares at the Fund's inception on
7/22/96 would have been valued at $16,489 on 10/31/01 ($16,159 with a redemption
at the end of the period.)
A $10,000 investment in the fund's Class C shares at the Fund's inception on
7/22/96 would have been valued at $16,309 on 10/31/01 (a redemption at the end
of the period would result in the same value because the CDSC period expired.)
Performance information may reflect historical or current expense
waivers/reimbursements from an affiliate of the investment adviser, without
which performance would have been lower.
For information on current expense waivers/reimbursements, please see the
prospectus.
Q. How Did The Fund Perform?
The Hartford Advisers Fund returned -10.7% (for class A shares) for the
twelve-month period ending October 31, 2001. The Fund outperformed the Lipper
Flexible Portfolio peer group -12.39%, while underperforming the Composite
Index(+) benchmark -9.30%.
Q. Why Did The Fund Perform This Way?
During the year, the equity ratio in the Fund declined from a high of 70% to 55%
but is currently back to 60% as we gradually reduce our exposure to bonds. In
the past twelve months, the Fund greatly decreased its position in Technology,
eliminating such holdings as Dell Computer and Veritas Software, and is now
underweight in the industry. Despite overall poor performance of Technology
throughout the year, good Technology stock selection with respect to the
benchmark contributed positively to Fund performance for the twelve-month
period. Over the year, the Fund also decreased its position in Consumer Staples
and increased its weight in Utilities and Materials.
In a year marked by falling interest rates, missed earnings and falling stock
prices, the fixed-income portion of the portfolio was helped by its
longer-than-benchmark duration. Corporate- and mortgage-backed securities
outperformed Treasuries early in the year, but later lagged, as refinancing
activity increased due to interest rate cuts. By the end of the fiscal year,
Treasury securities were showing the best performance in the fixed-income area.
Q. What Is Your Outlook?
Like nearly everyone in the world, we were shocked and saddened by the tragic
events of September 11th. Although we believe that the economy will be weak for
some months to come and that corporate earnings will also be under pressure, we
believe that in the long run the U.S. economy will recover and prosper once
again. While the near-term outlook for the U.S. economy may be poor, aggressive
fiscal and monetary policy actions, coupled with low inflation, should re-ignite
growth in 2002. It remains clear that the Fed and the Congress are doing
whatever they can in order to help the economy recover. In the current
low-interest rate environment, large capitalization, high quality growth
companies look very attractive and should prove to be rewarding investments over
the next few years.
(+) Composite benchmark consists of the S&P 500 and the Lehman Govt/Corp Index.
B-2
The Hartford
Global Leaders Fund
Portfolio Manager
[PHOTO OF ANDREW S. OFFIT]
ANDREW S. OFFIT
Senior Vice President & Partner
Wellington Management Company, LLP
Performance Overview
9/30/98 - 10/31/01
Growth of a $10,000 investment in
Class A which includes Sales Charge
[LINE GRAPH]
Global
Leaders MSCI
Fund World
9,450 10,000
10,697 10,902
13,478 13,037
14,697 13,619
18,472 14,640
17,288 13,767
12,781 10,255
GLOBAL LEADERS FUND MSCI WORLD
$9,450 starting value $10,000 starting value
RETURNS (Inception 9/30/98)
Standard Non-Standard
ANNUALIZED ANNUALIZED
1 YEAR(1) SINCE INCEPT.(1) 1 YEAR(2) SINCE INCEPT.(2)
-------- --------------- -------- ----------------
Global Leaders A -30.14% 8.27% -26.07% 10.27%
Global Leaders B -31.64% 8.66% -26.64% 9.47%
Global Leaders C -28.35% 9.15% -26.62% 9.49%
MSCI World -25.20% 1.20%
The chart represents a hypothetical investment in The Hartford Global Leaders
Fund. Past performance does not guarantee future results.
The value of shares will fluctuate so that when redeemed, shares may be worth
more or less than their original cost.
(1) The initial investment in Class A and C shares reflects the maximum sales
charge and B shares reflect a CDSC.
(2) Performance results do not reflect sales charge.
A $10,000 investment in the fund's Class B shares at the Fund's inception on
9/30/98 would have been valued at $13,224 on 10/31/01 ($12,827 with a redemption
at the end of the period.)
A $10,000 investment in the fund's Class C shares at the Fund's inception on
9/30/98 would have been valued at $13,103 on 10/31/01 (a redemption at the end
of the period would result in the same value because the CDSC period expired.)
Performance information may reflect historical or current expense
waivers/reimbursements from an affiliate of the investment adviser, without
which performance would have been lower.
For information on current expense waivers/reimbursements, please see the
prospectus.
Q.
How Did The Fund Perform?
The Hartford Global Leaders Fund returned -26.1% (for class A shares) for the
twelve-month period ending October 31, 2001. The Fund underperformed its
benchmarks, the MSCI World Index, which returned -25.2%, and the Lipper Global
Average, which returned -25.8%.
Q.
Why Did The Fund Perform This Way?
During the past twelve months, stock picking has been critical to the
strategy and strength of the Fund. Good technology stock selection
with respect to the benchmark contributed positively to Fund performance for the
twelve-month period. Holdings such as Micron Technology and STMicroelectronics
were additive. The Fund's largest industry overweight, Consumer Discretionary,
exhibited some of the best stock selection during the period, while, the
Telecommunications industry was the major detractor from the Fund's performance
for the twelve months.
Q.
What Is Your Outlook?
Overall, we are optimistic for the medium-term. The Technology,
Consumer Discretionary, and Telecom areas have underperformed the market
dramatically over the last several quarters and, with many investors underweight
in these areas and business trends bottoming, we should see improvements.
Larger-cap global-leading names should emerge from this slowdown stronger and
better positioned. We are taking full advantage of this trend.
Volatility can cause periods of uncertainty. Overall this is good news for the
Fund because by their very nature, global leaders have superior products, market
share, and management. Over the long term, if we continue to identify the
winning sectors and companies, the Fund should succeed and outperform.
B-3
The Hartford
Growth and Income Fund
Portfolio Manager
[PHOTO OF JAMES A. RULLO]
JAMES A. RULLO, CFA
Senior Vice President & Partner
Wellington Management Company, LLP
Performance Overview
4/30/98 - 10/31/01
Growth of a $10,000 investment in
Class A which includes Sales Charge
[LINE GRAPH]
Growth and
Income Fund S&P 500
- ----------- -------
9,450 10,000
9,625 9,959
11,652 12,181
11,861 12,515
13,104 13,414
13,124 13,276
10,380 9,982
RETURNS (Inception 4/30/98)
Standard Non-Standard
ANNUALIZED ANNUALIZED
1 YEAR(1) SINCE INCEPT.(1) 1 YEAR(2) SINCE INCEPT.(2)
---------------------------- ----------------------------
Growth & Inc A -25.25% 1.07% -20.90% 2.71%
Growth & Inc B -26.51% 1.13% -21.51% 1.95%
Growth & Inc C* -23.29% 1.70% -21.50% 1.99%
S&P 500 -24.89% -0.10%
The chart represents a hypothetical investment in The Hartford Growth and Income
Fund. Past performance does not guarantee future results.
The value of shares will fluctuate so that when redeemed, shares may be worth
more or less than their original cost.
(1) The initial investment in Class A and C shares reflects the maximum sales
charge and B shares reflect a CDSC.
(2) Performance results do not reflect sales charge.
* Class C Shares commenced operations on 8/1/98. Performance prior to 8/1/98
reflects Class B performance less Class C sales charges where applicable.
A $10,000 investment in the fund's Class B shares at the Fund's inception on
4/30/98 would have been valued at $10,702 on 10/31/01 ($10,381 with a redemption
at the end of the period.)
A $10,000 investment in the fund's Class C shares at the Fund's inception on
4/30/98 would have been valued at $10,609 on 10/31/01 (a redemption at the end
of the period would result in the same value because the CDSC period expired.)
Performance information may reflect historical or current expense
waivers/reimbursements from an affiliate of the investment adviser, without
which performance would have been lower.
For information on current expense waivers/reimbursements, please see the
prospectus.
Q. How Did The Fund Perform?
The Hartford Growth and Income Fund returned -20.9% (for class A shares) for the
12-month period ending October 31, 2001. The Fund's return exceeded the return
for the S&P 500 Index, which returned -24.9% and the Lipper Large Cap Core
Average, which returned -25.5% during the same time period.
Q. Why Did The Fund Perform This Way?
Good stock selection within Financials, Technology, and Health Care contributed
to the Fund's outperformance relative to the S&P 500 Index during the period.
Strong performers in the Financials sector included Pacific Century,
UnionBanCal, and Lehman Brothers. Technology holdings IBM, Micron and Intuit
held up relatively well during the period. Health Care holdings Genzyme, Johnson
& Johnson, and Tenet Healthcare were among the strongest performers in the Fund.
Q. What Is Your Outlook?
Before the terrorist attacks of September 11, we believed that consumer spending
would sustain the economy just long enough for a late 2001 early 2002 economic
rebound to take hold, driven by a completed inventory correction. In the wake of
the terrorist attacks, we now forecast that consumer spending will fall faster
and to levels lower than consensus expectations and that corporations will face
another round of inventory corrections. It is likely that a recovery will not
take place until the second half of 2002. Despite the gloomy economic forecast
and geopolitical uncertainty, we are finding attractive stocks and sectors as a
result of the changing environment. In this highly volatile market environment,
we will continue to focus on selecting attractive companies trading at
attractive valuations.
B-4
The Hartford
High Yield Fund
Portfolio Manager
[PHOTO OF ALISON D. GRANGER]
ALISON D. GRANGER, CFA
Senior Vice President
Hartford Investment
Management Company
Performance Overview
9/30/98 - 10/31/01
Growth of a $10,000 investment in
Class A which includes Sales Charge
[LINE GRAPH]
High Yield Lehman High
Fund Yield
---- -----
9,550 10,000
9,529 9,795
10,326 10,603
10,040 10,222
10,049 10,230
10,176 10,057
10,359 10,040
RETURNS (Inception 9/30/98)
Standard Non-Standard
ANNUALIZED ANNUALIZED
1 YEAR(1) SINCE INCEPT.(1) 1 YEAR(2) SINCE INCEPT.(2)
---------------------------- ----------------------------
High Yield A -2.78% 1.15% 1.80% 2.67%
High Yield B -4.01% 0.97% 0.99% 1.91%
High Yield C -1.00% 1.60% 1.01% 1.93%
Lehman High Yield -0.16% 0.13%
The chart represents a hypothetical investment in The Hartford High Yield Fund.
Past performance does not guarantee future results.
The value of shares will fluctuate so that when redeemed, shares may be worth
more or less than their original cost.
(1) The initial investment in Class A and C shares reflects the maximum sales
charge and B shares reflect a CDSC.
(2) Performance results do not reflect sales charge.
A $10,000 investment in the fund's Class B shares at the Fund's inception on
9/30/98 would have been valued at $10,602 on 10/31/01 ($10,284 with a redemption
at the end of the period.)
A $10,000 investment in the fund's Class C shares at the Fund's inception on
9/30/98 would have been valued at $10,502 on 10/31/01 (a redemption at the end
of the period would result in the same value because the CDSC period expired.)
Performance information may reflect historical or current expense
waivers/reimbursements from an affiliate of the investment adviser, without
which performance would have been lower.
For information on current expense waivers/reimbursements, please see the
prospectus.
Q. How Did The Fund Perform?
The Hartford High Yield Fund's shares placed in the 19th percentile of its
Lipper peer group for the one year ended October 31, 2001, producing a total
return of 1.8% (for class A shares) versus the - 2.7% return of the Lipper
Mutual Fund and Variable Annuity High Yield Fixed Income Universe.
Q. Why Did The Fund Perform This Way?
The Fund's above-average credit quality and low default experience continued to
benefit performance this year.
Our overweight positions in the healthcare and energy industries benefited
performance throughout the year. Health Care providers continue to enjoy rating
upgrades due to greater pricing power and therefore, improved financial
situations. Energy issuers, despite the more recent fall in the price of oil,
also strengthened their balance sheets over the past two years as the relatively
high price of oil allowed them to pay down debt.
Although premature in the second quarter, the Funds' increased exposure to
select telecommunications issuers also aided performance. Specifically, the
funds increased their exposure to select telecom equipment manufacturers and
wireline providers as investors sold securities due to heightened default
concerns. These deeply-discounted issues have since recovered from the depths of
their second-quarter sell-off.
Finally our underweight to cable assets weighed on the Funds' returns throughout
the year.
Q. What Is Your Outlook?
Given the backdrop of the Fed's 450 basis points of easing year to date, we
believe that riskier assets are poised to outperform in the coming quarters. As
such, we have begun to downgrade the portfolio, anticipating that lower quality
assets stand to gain the most. To that end, we continue to favor issuers in the
wireline and technology segments of the telecommunications industry. Such
issuers continue to trade at relatively attractive prices as we believe the
market is currently overestimating the likelihood of default.
We also are emphasizing some of the basic industries and commodity issuers such
as pulp/paper, chemicals, and metals and mining paper as prices of such issuers
have cheapened dramatically in response to poor economic data. Individual issuer
and security selection is key, and we are working closely with our traders and
analysts to identify those with high potential for attractive return
Conversely, the tragic events of September 11th reinforced the view we have held
for most of the year that consumer-related high yield issuers such as those in
the retail, homebuilding and gaming industries, along with lodging and
transportation issuers were overvalued. We will therefore maintain our
underweight to such issuers as prices have yet to reflect our view.
B-5
The Hartford
International Opportunities Fund
Portfolio Manager
[PHOTO OF TROND SKRAMSTAD]
TROND SKRAMSTAD
Senior Vice President,
Partner & Director of
International Equities
Wellington
Management
Company, LLP
Associate Portfolio Manager
[PHOTO OF ANDREW S. OFFIT]
ANDREW S. OFFIT
Senior Vice President
& Partner
Wellington Management
Company, LLP
Performance Overview
7/22/96 - 10/31/01
Growth of a $10,000 investment in
Class A which includes Sales Charge
[LINE GRAPH]
International MSCI EAFE
Opportunities GDP
9,450 10,000
9,658 10,221
10,115 10,629
10,483 11,077
11,864 13,326
10,675 12,961
12,745 15,054
13,630 16,350
15,378 17,590
13,685 15,958
10,283 11,821
INTERNATIONAL OPPORTUNITIES MSCI EAFE GDP
$9,450 starting value $10,000 starting value
RETURNS (Inception 7/22/96)
Standard Non-Standard
ANNUALIZED ANNUALIZED
1 YEAR(1) 5 YEAR(1) SINCE INCEPT.(1) 1 YEAR(2) 5 YEAR(2) SINCE INCEPT.(2)
-------- -------- --------------- -------- -------- ---------------
Int'l Opp A -29.00% 0.06% 0.53% -24.87% 1.20% 1.61%
Int'l Opp B -30.46% 0.03% 0.71% -25.46% 0.50% 0.89%
Int'l Opp C* -27.25% 0.08% 0.68% -25.51% 0.48% 0.87%
MSCI EAFE GDP -25.86% 2.97% 3.10%
The chart represents a hypothetical investment in The Hartford International
Opportunities Fund. Past performance does not guarantee future results.
The value of shares will fluctuate so that when redeemed, shares may be worth
more or less than their original cost.
(1) The initial investment in Class A and C shares reflects the maximum sales
charge and B shares reflect a CDSC.
(2) Performance results do not reflect sales charge.
* Class C Shares commenced operations on 8/1/98. Performance prior to 8/1/98
reflects Class B performance less Class C sales charges where applicable.
A $10,000 investment in the fund's Class B shares at the Fund's inception on
7/22/96 would have been valued at $10,479 on 10/31/01 ($10,269 with a redemption
at the end of the period.)
A $10,000 investment in the fund's Class C shares at the Fund's inception on
7/22/96 would have been valued at $10,363 on 10/31/01 (a redemption at the end
of the period would result in the same value because the CDSC period expired.)
Performance information may reflect historical or current expense
waivers/reimbursements from an affiliate of the investment adviser, without
which performance would have been lower.
For information on current expense waivers/reimbursements, please see the
prospectus.
Q.
How Did The Fund Perform?
The Hartford International Opportunities Fund returned -24.9% (for class A
share) for the twelve-month period ending October 31, 2001. The Fund
outperformed both the Lipper International Fund Average, which returned -26.38%
and the MSCI EAFE GDP Index, which returned -25.81%.
Q.
Why Did The Fund Perform This Way?
The Fund benefited from strong regional and asset allocation decisions
as the underweights in the weak Japan and Latin American markets, overweight in
the strong UK and Korea markets and larger than normal cash weighting all
contributed positively to performance. The Fund also benefited from strong stock
selection in Europe, particularly France, Switzerland and Sweden, which offset
weak stock selection in Japan and the emerging markets.
From a industry point of view, stock selection was strong in the Technology and
Materials industries but lagged somewhat in Telecommunications. Over the year,
the Fund had reduced its positions in Telecommunications and Technology, as the
weakening economy most noticeably affected these sectors. However, the Fund has
recently been increasing its positions in these areas, and is currently
overweight in both, as well as in Health Care. The most significant increase in
position during the past year has been in the Consumer Discretionary industry,
although concern over a slowdown in consumer spending has recently led us to
begin reducing exposure in this area.
Q.
What Is Your Outlook?
We continue to favor Europe over Japan and the Pac Basin ex-Japan due to its
more stable economy and attractively valued currencies. The Japanese economy
remains in very poor shape, and the Koizumi government, while promising much,
has so far produced little in the way of economic restructuring or banking
reform. The recent terrorist attacks on the United States will likely amplify
economic and market developments that were already unfolding, resulting in a
longer and deeper slowdown than was expected. We expect slower growth over the
coming months, particularly on the consumer side, as people re-assess priorities
and conserve resources amidst uncertainty. Capital investment is also likely to
be further restrained. We expect considerable market volatility in the
short-run, as economic and geopolitical risk remains high. We are taking
advantage of market weakness, however, as the massive amounts of liquidity and
growing fiscal stimulus promise to turn the global economy around by next year.
B-6
APPENDIX C
HARTFORD FUND
FINANCIAL HIGHLIGHTS
The tables included in this Appendix are intended to help you understand
the financial performance of each Hartford Fund for the past five years or, if
shorter, the period since the Fund's inception. Certain information reflects
financial results for a single Fund share. The total returns in the tables
represent the rate an investor would have earned, or lost, on an investment in
each Fund (assuming reinvestment of all dividends and distributions). This
information has been audited by Arthur Andersen LLP, whose report, along with
each Fund's financial statements and financial highlights, are included in the
annual report which is available upon request.
C-1
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- SELECTED PER-SHARE DATA(A) --
-----------------------------------------------------------------------------------------------
NET REALIZED
AND DISTRIBUTIONS
NET ASSET NET UNREALIZED TOTAL DIVIDENDS FROM
VALUE AT INVESTMENT GAIN FROM FROM NET REALIZED DISTRIBUTIONS
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL FROM
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS CAPITAL
--------- ---------- ------------ ---------- ---------- ------------- -------------
THE HARTFORD ADVISERS FUND
For the Year Ended October
31, 2001
Class A...................... $17.07 $ 0.30 $(2.05) $(1.75) $(0.31) $(0.64) $ --
Class B...................... 16.90 0.20 (2.03) (1.83) (0.19) (0.64) --
Class C...................... 17.05 0.20 (2.04) (1.84) (0.20) (0.64) --
Class Y...................... 17.24 0.38 (2.07) (1.69) (0.38) (0.64) --
For the Ten Months Ended
October 31, 2000
Class A...................... 17.02 0.24 0.19 0.43 (0.22) (0.16) --
Class B...................... 16.87 0.15 0.17 0.32 (0.13) (0.16) --
Class C...................... 17.02 0.15 0.17 0.32 (0.13) (0.16) --
Class Y...................... 17.16 0.33 0.16 0.49 (0.25) (0.16) --
For the Year Ended December
31, 1999
Class A...................... 15.71 0.27 1.60 1.87 (0.25) (0.31) --
Class B...................... 15.59 0.16 1.58 1.74 (0.15) (0.31) --
Class C...................... 15.73(f) 0.17(f) 1.58(f) 1.75(f) (0.15)(f) (0.31)(f) --(f)
Class Y...................... 15.80 0.35 1.61 1.96 (0.29) (0.31) --
For the Year Ended December
31, 1998
Class A...................... 13.41 0.23 2.58 2.81 (0.25) (0.26) --
Class B...................... 13.33 0.15 2.54 2.69 (0.17) (0.26) --
Class Y...................... 13.46 0.29 2.59 2.88 (0.28) (0.26) --
From inception August 1,
1998, through December 31,
1998
Class C...................... 15.56(f) 0.16(f) 0.64(f) 0.80(f) (0.22)(f) (0.40)(f) --(f)
For the Year Ended December
31, 1997
Class A...................... 11.08 0.16 2.41 2.57 (0.17) (0.07) --
Class B...................... 11.05 0.16 2.31 2.47 (0.12) (0.07) --
Class Y...................... 11.10 0.31 2.32 2.63 (0.20) (0.07) --
From inception July 1, 1996
to December 31, 1996
Class A...................... 10.00 0.09 1.07 1.16 (0.08) -- --
Class B...................... 10.00 0.02 1.11 1.13 (0.08) -- --
Class Y...................... 10.00 0.03 1.16 1.19 (0.09) -- --
THE HARTFORD GLOBAL LEADERS FUND
For the Year Ended October
31, 2001
Class A...................... 17.55 0.01 (4.54) (4.53) (0.18) (0.01)
Class B...................... 17.29 (0.08) (4.48) (4.56) -- (0.18) (0.01)
Class C...................... 17.30 (0.10) (4.46) (4.56) -- (0.18) (0.01)
Class Y...................... 17.73 0.08 (4.59) (4.51) -- (0.18) (0.01)
For the Ten Months Ended
October 31, 2000
Class A...................... 18.56 --(g) (0.92) (0.92) -- (0.09) --
Class B...................... 18.40 (0.06) (0.96) (1.02) -- (0.09) --
Class C...................... 18.40 (0.06) (0.95) (1.01) -- (0.09) --
Class Y...................... 18.68 0.03 (0.89) (0.86) -- (0.09) --
For the Year Ended December
31, 1999
Class A...................... 12.67 --(g) 6.01 6.01 -- (0.12) --
Class B...................... 12.65 (0.02) 5.89 5.87 -- (0.12) --
Class C...................... 12.65 (0.02) 5.89 5.87 -- (0.12) --
Class Y...................... 12.69 0.03 6.08 6.11 -- (0.12) --
From inception September 30,
1998, through December 31,
1998
Class A...................... 10.00 (0.01) 3.03 3.02 -- (0.35) --
Class B...................... 10.00 (0.02) 3.02 3.00 -- (0.35) --
Class C...................... 10.00 (0.02) 3.02 3.00 -- (0.35) --
Class Y...................... 10.00 0.01 3.03 3.04 -- (0.35) --
</Table>
- ---------------
(a)Information presented relates to a share of capital share outstanding
throughout the indicated period.
(b)Annualized.
(c)Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charge.
Total return would be reduced if sales charges were taken into account.
(d)Not annualized.
(e)Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(f)Per share amounts have been restated to reflect a reverse stock split for
Class C shares effective February 11, 1999.
(g)Net Investment Income (Loss) is less than a penny a share.
C-2
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- ---------------------------------------------------------------------------------------------------
RATIO OF
EXPENSES
NET ASSETS TO AVERAGE
NET INCREASE NET ASSET AT END OF NET ASSETS
TOTAL (DECREASE) IN VALUE AT TOTAL PERIOD BEFORE WAIVERS AND
DISTRIBUTIONS NET ASSETS END OF PERIOD RETURN(C) (IN THOUSANDS) REIMBURSEMENTS
------------- ------------- ------------- --------- -------------- ------------------
$(0.94)... $(2.69) $14.38 (10.67)% $1,088,858 1.27%
(0.83)... (2.66) 14.24 (11.27) 622,519 1.93
(0.84)... (2.68) 14.37 (11.26) 478,194 1.93
(1.01)... (2.70) 14.54 (10.20) 56,320 0.74
(0.38)... 0.05 17.07 2.52(d) 893,954 1.26(b)
(0.29)... 0.03 16.90 1.89(d) 631,930 1.92(b)
(0.29)... 0.03 17.05 1.89(d) 432,171 1.92(b)
(0.41)... 0.08 17.24 2.90(d) 64,889 0.75(b)
(0.56)... 1.31 17.02 12.08 693,136 1.31
(0.46)... 1.28 16.87 11.29 555,338 1.97
(0.46)(f) 1.29(f) 17.02(f) 11.29 323,631 1.99
(0.60)... 1.36 17.16 12.62 68,133 0.79
(0.51)... 2.30 15.71 21.09 316,435 1.43
(0.43)... 2.26 15.59 20.27 237,959 2.11
(0.54)... 2.34 15.80 21.62 57,891 0.90
(0.62)(f) 0.17(f) 15.73(f) 5.25(d) 54,907 2.18(b)
(0.24)... 2.33 13.41 23.30 98,633 1.60
(0.19)... 2.28 13.33 22.44 39,334 2.31
(0.27)... 2.36 13.46 23.80 39,773 1.03
(0.08)... 1.08 11.08 11.56(d) 14,347 2.99(b)
(0.08)... 1.05 11.05 11.28(d) 1,499 6.71(b)
(0.09)... 1.10 11.10 11.88(d) 34 144.82(b)
(0.19) (4.72) 12.83 (26.07) 247,094 1.53
(0.19) (4.75) 12.54 (26.64) 62,973 2.23
(0.19) (4.75) 12.55 (26.62) 103,574 2.19
(0.19) (4.70) 13.03 (25.68) 7,908 0.98
(0.09) (1.01) 17.55 (4.98)(d) 255,959 1.53(b)
(0.09) (1.11) 17.29 (5.56)(d) 75,702 2.22(b)
(0.09) (1.10) 17.30 (5.51)(d) 142,549 2.19(b)
(0.09) (0.95) 17.73 (4.62)(d) 10,001 1.01(b)
(0.12) 5.89 18.56 47.68 84,632 1.62
(0.12) 5.75 18.40 46.64 24,588 2.29
(0.12) 5.75 18.40 46.64 43,012 2.33
(0.12) 5.99 18.68 48.39 4,423 1.10
(0.35) 2.67 12.67 30.36(d) 3,771 2.71(b)
(0.35) 2.65 12.65 30.16(d) 486 3.55(b)
(0.35) 2.65 12.65 30.16(d) 517 3.57(b)
(0.35) 2.69 12.69 30.57(d) 392 2.46(b)
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- --- ---------------------------------
RATIO OF RATIO OF
EXPENSES NET
TO AVERAGE INVESTMENT
NET ASSETS INCOME (LOSS) PORTFOLIO
AFTER WAIVERS AND TO AVERAGE TURNOVER
REIMBURSEMENTS NET ASSETS RATE(E)
----------------- ------------- ---------
1.22% 1.99% 36.9%
1.93 1.28 --
1.93 1.28 --
0.74 2.48 --
1.21(b) 1.76(b) 38.4
1.92(b) 1.05(b) --
1.92(b) 1.05(b) --
0.75(b) 2.22(b) --
1.26 1.72 34.6
1.97 1.00 --
1.99 0.99 --
0.79 2.18 --
1.38 1.67 40.2
2.10 0.98 --
0.90 2.09 --
2.10(b) 1.06(b) --
1.40 1.54 38.6
2.10 0.80 --
0.95 2.08 --
1.40(b) 2.13(b) 19.8
2.10(b) 1.24(b) --
0.95(b) 2.75(b) --
1.48 0.08 381.7
2.23 (0.66) --
2.19 (0.63) --
0.98 0.58 --
1.48(b) (0.06)(b) 290.0
2.22(b) (0.80)(b) --
2.19(b) (0.77)(b) --
1.01(b) 0.41(b) --
1.57 (0.15) 203.7
2.29 (0.86) --
2.33 (0.89) --
1.10 0.32 --
1.65(b) (0.19)(b) 49.0
2.35(b) (0.92)(b) --
2.35(b) (0.90)(b) --
1.20(b) 0.31(b) --
</Table>
C-3
FINANCIAL HIGHLIGHTS -- (CONTINUED)
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- SELECTED PER-SHARE DATA(A) --
-----------------------------------------------------------------------------------------------
NET REALIZED
AND DISTRIBUTIONS
NET ASSET NET UNREALIZED TOTAL DIVIDENDS FROM
VALUE AT INVESTMENT GAIN FROM FROM NET REALIZED DISTRIBUTIONS
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL FROM
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS CAPITAL
--------- ---------- ------------ ---------- ---------- ------------- -------------
THE HARTFORD GROWTH AND INCOME
FUND
For the Year Ended October
31, 2001
Class A...................... $13.63 $ --(g) $(2.75) $(2.75) $ -- $(0.52) $ --
Class B...................... 13.40 (0.05) (2.73) (2.78) -- (0.52) --
Class C...................... 13.41 (0.06) (2.72) (2.78) -- (0.52) --
Class Y...................... 13.78 0.03 (2.77) (2.74) -- (0.52) --
For the Ten Months Ended
October 31, 2000
Class A...................... 13.72 (0.02) 0.04 0.02 -- (0.11) --
Class B...................... 13.58 (0.06) (0.01) (0.07) -- (0.11) --
Class C...................... 13.58 (0.06) 0.00 (0.06) -- (0.11) --
Class Y...................... 13.83 0.02 0.04 0.06 -- (0.11) --
For the Year Ended December
31, 1999
Class A...................... 11.45 0.01 2.36 2.37 -- (0.10) --
Class B...................... 11.41 (0.02) 2.29 2.27 -- (0.10) --
Class C...................... 11.41(f) (0.03)(f) 2.30(f) 2.27(f) --(f) (0.10)(f) --(f)
Class Y...................... 11.48 0.06 2.39 2.45 -- (0.10) --
From inception April 30,
1998, through December 31,
1998
Class A...................... 10.00 0.02 1.45 1.47 -- -- (0.02)
Class B...................... 10.00 (0.01) 1.43 1.42 -- -- (0.01)
Class Y...................... 10.00 0.05 1.46 1.51 -- -- (0.03)
From inception August 1,
1998, through December 31,
1998
Class C...................... 10.14(f) 0.01(f) 1.29(f) 1.30(f) --(f) --(f) (0.03)(f)
THE HARTFORD HIGH YIELD FUND
For the Year Ended October
31, 2001
Class A...................... 9.06 0.78 (0.61) 0.17 (0.78) -- --
Class B...................... 9.05 0.72 (0.62) (0.10) (0.72) -- --
Class C...................... 9.05 0.72 (0.62) (0.10) (0.72) -- --
Class Y...................... 9.10 0.83 (0.63) 0.20 (0.82) -- --
For the Ten Months Ended
October 31, 2000
Class A...................... 9.75 0.66 (0.69) (0.03) (0.66) -- --
Class B...................... 9.74 0.62 (0.71) (0.09) (0.60) -- --
Class C...................... 9.74 0.61 (0.70) (0.09) (0.60) -- --
Class Y...................... 9.78 0.69 (0.69) (0.00) (0.68) -- --
For the Year Ended December
31, 1999
Class A...................... 10.15 0.75 (0.40) 0.35 (0.75) -- --
Class B...................... 10.14 0.68 (0.40) 0.28 (0.68) -- --
Class C...................... 10.14 0.68 (0.40) 0.28 (0.68) -- --
Class Y...................... 10.16 0.78 (0.39) 0.39 (0.77) -- --
From inception September 30,
1998, through December 31,
1998
Class A...................... 10.00 0.19 0.13 0.32 (0.17) -- --
Class B...................... 10.00 0.16 0.14 0.30 (0.16) -- --
Class C...................... 10.00 0.16 0.14 0.30 (0.16) -- --
Class Y...................... 10.00 0.21 0.13 0.34 (0.18) -- --
</Table>
- ---------------
(a)Information presented relates to a share of capital share outstanding
throughout the indicated period.
(b)Annualized.
(c)Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charge.
Total return would be reduced if sales charges were taken into account.
(d)Not annualized.
(e)Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(f)Per share amounts have been restated to reflect a reverse stock split for
Class C shares effective February 11, 1999.
(g)Net Investment Income (Loss) is less than a penny a share.
C-4
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- ---------------------------------------------------------------------------------------------------
RATIO OF
EXPENSES
NET ASSETS TO AVERAGE
NET INCREASE NET ASSET AT END OF NET ASSETS
TOTAL (DECREASE) IN VALUE AT TOTAL PERIOD BEFORE WAIVERS AND
DISTRIBUTIONS NET ASSETS END OF PERIOD RETURN(C) (IN THOUSANDS) REIMBURSEMENTS
------------- ------------- ------------- --------- -------------- ------------------
$(0.52)... $(3.27) $10.36 (20.90)% $239,698 1.43%
(0.52)... (3.30) 10.10 (21.51) 43,210 2.11
(0.52)... (3.30) 10.11 (21.50) 60,409 2.09
(0.52)... (3.26) 10.52 (20.60) 440 0.96
(0.11)... (0.09) 13.63 0.15(d) 197,176 1.43(b)
(0.11)... (0.18) 13.40 (0.51)(d) 41,126 2.11(b)
(0.11)... (0.17) 13.41 (0.44)(d) 63,650 2.09(b)
(0.11)... (0.05) 13.78 0.44(d) 490 0.95(b)
(0.10)... 2.27 13.72 20.80 74,764 1.49
(0.10)... 2.17 13.58 20.00 20,375 2.13
(0.10)(f) 2.17(f) 13.58(f) 19.98 29,265 2.16
(0.10)... 2.35 13.83 21.45 480 0.93
(0.02)... 1.45 11.45 14.78(d) 11,120 1.63(b)
(0.01)... 1.41 11.41 14.21(d) 3,538 2.32(b)
(0.03)... 1.48 11.48 15.18(d) 386 1.20(b)
(0.03)(f) 1.27(f) 11.41(f) 12.80(d) 3,726 2.38(b)
(0.78) (0.61) 8.45 1.80% 45,753 1.40
(0.72) (0.62) 8.43 0.99 16,922 2.08
(0.72) (0.62) 8.43 1.01 27,605 2.08
(0.82) (0.62) 8.48 2.15 4,223 0.88
(0.66) (0.69) 9.06 (0.35)(d) 23,214 1.38(b)
(0.60) (0.69) 9.05 (0.92)(d) 7,929 2.04(b)
(0.60) (0.69) 9.05 (0.90)(d) 9,534 2.04(b)
(0.68) (0.68) 9.10 0.02(d) 2,955 0.89(b)
(0.75) (0.40) 9.75 3.47 17,465 1.41
(0.68) (0.40) 9.74 2.80 7,436 2.08
(0.68) (0.40) 9.74 2.81 8,573 2.09
(0.77) (0.38) 9.78 3.98 2,314 0.90
(0.17) 0.15 10.15 3.33(d) 8,507 1.58(b)
(0.16) 0.14 10.14 3.09(d) 2,322 2.31(b)
(0.16) 0.14 10.14 3.08(d) 2,278 2.31(b)
(0.18) 0.16 10.16 3.51(d) 1,034 1.17(b)
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- --- ---------------------------------------------
RATIO OF RATIO OF
EXPENSES NET
TO AVERAGE INVESTMENT
NET ASSETS INCOME (LOSS) PORTFOLIO
AFTER WAIVERS AND TO AVERAGE TURNOVER
REIMBURSEMENTS NET ASSETS RATE(E)
----------------- ------------- ---------
1.38% (0.07)% 79.8%
2.11 (0.80) --
2.09 (0.78) --
0.96 0.34 --
1.38(b) (0.17)(b) 62.6
2.11(b) (0.90)(b) --
2.09(b) (0.88)(b) --
0.95(b) 0.26(b) --
1.44 0.01 53.0
2.13 (0.68) --
2.15 (0.69) --
0.93 0.51 --
1.45(b) 0.23(b) 35.1
2.15(b) (0.47)(b) --
1.00(b) 0.76(b) --
2.15(b) (0.53)(b) --
1.35 9.00 62.8
2.08 8.28 --
2.08 8.28 --
0.88 9.48 --
1.33(b) 8.55(b) 57.2
2.04(b) 7.84(b) --
2.04(b) 7.83(b) --
0.89(b) 8.99(b) --
1.36 7.74 53.0
2.08 7.03 --
2.09 7.01 --
0.90 8.20 --
1.40(b) 7.06(b) 10.9
2.10(b) 6.50(b) --
2.10(b) 6.49(b) --
0.95(b) 7.48(b) --
</Table>
C-5
FINANCIAL HIGHLIGHTS -- (CONTINUED)
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- SELECTED PER-SHARE DATA(A) --
-----------------------------------------------------------------------------------------------
NET REALIZED
AND DISTRIBUTIONS
NET ASSET NET UNREALIZED TOTAL DIVIDENDS FROM
VALUE AT INVESTMENT GAIN FROM FROM NET REALIZED DISTRIBUTIONS
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL FROM
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS CAPITAL
--------- ---------- ------------ ---------- ---------- ------------- -------------
THE HARTFORD INTERNATIONAL
OPPORTUNITIES FUND
For the Year Ended October
31, 2001
Class A...................... $13.03 $ 0.05 $(3.14) $(3.09) $ -- $(0.61) $--
Class B...................... 12.74 (0.04) (3.05) (3.09) -- (0.61) --
Class C...................... 12.68 (0.03) (3.05) (3.08) -- (0.61) --
Class Y...................... 13.19 0.09 (3.18) (3.09) -- (0.61) --
For the Ten Months Ended
October 31, 2000
Class A...................... 15.43 0.08 (2.42) (2.34) (0.01) (0.05) --
Class B...................... 15.17 0.01 (2.39) (2.38) (0.00) (0.05) --
Class C...................... 15.10 0.07 (2.44) (2.37) (0.00) (0.05) --
Class Y...................... 15.56 0.12 (2.43) (2.31) (0.01) (0.05) --
For the Year Ended December
31, 1999
Class A...................... 11.89 0.06 4.46 4.52 (0.15) (0.83) --
Class B...................... 11.73 0.01 4.32 4.33 (0.06) (0.83) --
Class C...................... 11.74(f) (0.02)(f) 4.33(f) 4.31(f) (0.12)(f) (0.83)(f) --(f)
Class Y...................... 11.97 0.09 4.51 4.60 (0.18) (0.83) --
For the Year Ended December
31, 1998
Class A...................... 10.58 0.07 1.26 1.33 (0.02) -- --
Class B...................... 10.49 0.01 1.23 1.24 -- -- --
Class Y...................... 10.62 0.12 1.27 1.39 (0.04) -- --
From inception August 1,1998,
through December 31, 1998
Class C...................... 12.26(f) (0.01)(f) (0.49)(f) (0.50)(f) (0.03)(f) --(f) --(f)
For the Year Ended December
31, 1997
Class A...................... 10.72 0.09 (0.01) 0.08 (0.05) (0.17) --
Class B...................... 10.69 0.07 (0.06) 0.01 (0.04) (0.17) --
Class Y...................... 10.73 0.15 (0.02) 0.13 (0.07) (0.17) --
From inception July 1, 1996
to December 31, 1996
Class A...................... 10.00 0.02 0.79 0.81 (0.06) (0.03) --
Class B...................... 10.00 (0.01) 0.80 0.79 (0.07) (0.03) --
Class Y...................... 10.00 --(g) 0.84 0.84 (0.08) (0.03) --
THE HARTFORD MONEY MARKET FUND
For the Year Ended October
31, 2001
Class A...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class B...................... 1.00 0.03 -- 0.03 (0.03) -- --
Class C...................... 1.00 0.03 -- 0.03 (0.03) -- --
Class Y...................... 1.00 0.04 -- 0.04 (0.04) -- --
For the Ten Months Ended
October 31, 2000
Class A...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class B...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class C...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class Y...................... 1.00 0.05 -- 0.05 (0.05) -- --
For the Year Ended December
31, 1999
Class A...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class B...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class C...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class Y...................... 1.00 0.05 -- 0.05 (0.05) -- --
For the Year Ended December
31, 1998
Class A...................... 1.00 0.05 -- 0.05 (0.05) -- --
Class B...................... 1.00 0.04 -- 0.04 (0.04) -- --
Class Y...................... 1.00 0.05 -- 0.05 (0.05) -- --
From inception August 1,
1998, through December 31,
1998
Class C...................... 1.00 0.02 -- 0.02 (0.02) -- --
For the Year Ended December
31, 1997
Class A...................... 1.00 0.05 -- 0.05 (0.05) -- --
Class Y...................... 1.00 0.05 -- 0.05 (0.05) -- --
From inception August 22,
1997 to December 31, 1997
Class B...................... 1.00 0.01 -- 0.01 (0.01) -- --
From inception July 1, 1996
to December 31, 1996
Class A...................... 1.00 0.02 -- 0.02 (0.02) -- --
Class Y...................... 1.00 0.02 -- 0.02 (0.02) -- --
</Table>
- ---------------
(a)Information presented relates to a share of capital share outstanding
throughout the indicated period.
(b)Annualized.
(c)Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charge.
Total return would be reduced if sales charges were taken into account.
(d)Not annualized.
(e)Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(f)Per share amounts have been restated to reflect a reverse stock split for
Class C shares effective February 11, 1999.
(g)Net Investment Income (Loss) is less than a penny a share.
C-6
- --------------------------------------------------------------------------------
<Table>
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- ---------------------------------------------------------------------------------------------------
RATIO OF
EXPENSES
NET ASSETS TO AVERAGE
NET INCREASE NET ASSET AT END OF NET ASSETS
TOTAL (DECREASE) IN VALUE AT TOTAL PERIOD BEFORE WAIVERS AND
DISTRIBUTIONS NET ASSETS END OF PERIOD RETURN(C) (IN THOUSANDS) REIMBURSEMENTS
------------- ------------- ------------- --------- -------------- ------------------
$(0.61) $(3.70) $ 9.33 (24.87)% $72,326 1.61%
(0.61) (3.70) 9.04 (25.46) 18,798 2.30
(0.61) (3.69) 8.99 (25.51) 18,523 2.28
(0.61) (3.70) 9.49 (24.56) 17,092 1.06
(0.06) (2.40) 13.03 (15.18)(d) 89,309 1.60(b)
(0.05) (2.43) 12.74 (15.70)(d) 25,872 2.29(b)
(0.05) (2.42) 12.68 (15.70)(d) 26,912 2.27(b)
(0.06) (2.37) 13.19 (14.91)(d) 22,454 1.06(b)
(0.98) 3.54 15.43 39.13 63,281 1.61
(0.89) 3.44 15.17 38.11 22,835 2.26
(0.95)(f) 3.36(f) 15.10(f) 37.98 13,514 2.31
(1.01) 3.59 15.56 39.63 25,403 1.11
(0.02) 1.31 11.89 12.53 32,014 1.89
-- 1.24 11.73 11.82 11,767 2.56
(0.04) 1.35 11.97 13.11 10,860 1.36
(0.03)(f) (0.53)(f) 11.74(f) (4.05)(d) 1,379 2.83(b)
(0.22) (0.14) 10.58 0.84 15,701 2.30
(0.21) (0.20) 10.49 0.12 7,188 3.03
(0.24) (0.11) 10.62 1.31 6,422 1.76
(0.09) 0.72 10.72 8.14(d) 4,294 5.40(b)
(0.10) 0.69 10.69 7.86(d) 163 32.61(b)
(0.11) 0.73 10.73 8.36(d) 64 126.52(b)
(0.04)... -- 1.00 4.02 86,748 1.19
(0.03)... -- 1.00 3.31 48,998 1.85
(0.03)... -- 1.00 3.31 53,873 1.82
(0.04)... -- 1.00 4.49 33,309 0.61
(0.04)... -- 1.00 4.54(d) 43,897 1.20(b)
(0.04)... -- 1.00 3.94(d) 14,974 1.85(b)
(0.04)... -- 1.00 3.93(d) 6,842 1.85(b)
(0.05)... -- 1.00 4.94(d) 18,325 0.65(b)
(0.04)... -- 1.00 4.32 44,663 1.15
(0.04)... -- 1.00 3.59 25,762 1.81
(0.04)... -- 1.00 3.59 9,904 1.84
(0.05)... -- 1.00 4.80 8,953 0.64
(0.05)... -- 1.00 4.69 29,424 1.25
(0.04)... -- 1.00 3.97 11,936 1.86
(0.05)... -- 1.00 5.16 5,320 0.71
(0.02)... -- 1.00 1.58(d) 1,203 2.02(b)
(0.05)... -- 1.00 4.73 22,578 1.28
(0.05)... -- 1.00 5.23 2,638 0.82
(0.01)... -- 1.00 1.45(d) 4,449 3.63(b)
(0.02)... -- 1.00 2.01(d) 10,754 2.75(b)
(0.02)... -- 1.00 2.34(d) 0.30 3,496.38(b)
<Caption>
-- RATIOS AND SUPPLEMENTAL DATA --
- --- ------------------------------------------
RATIO OF RATIO OF
EXPENSES NET
TO AVERAGE INVESTMENT
NET ASSETS INCOME PORTFOLIO
AFTER WAIVERS AND TO AVERAGE TURNOVER
REIMBURSEMENTS NET ASSETS RATE(E)
----------------- ---------- ---------
1.56% 0.47% 158.1%
2.30 (0.28) --
2.28 (0.25) --
1.06 0.97 --
1.55(b) 0.64(b) 120.9
2.29(b) (0.09)(b) --
2.27(b) (0.07)(b) --
1.06(b) 1.13(b) --
1.56 0.61 128.3
2.26 (0.09) --
2.31 (0.13) --
1.11 1.07 --
1.65 0.69 148.6
2.35 0.01 --
1.20 1.17 --
2.35(b) (0.71)(b) --
1.65 0.88 59.2
2.35 (0.05) --
1.20 1.33 --
1.65(b) 0.51(b) 21.5
2.35(b) (0.86)(b) --
1.20(b) 0.57(b) --
1.00 3.63 N/A
1.70 2.93 --
1.70 2.93 --
0.55 4.08 --
1.00(b) 5.35(b) N/A
1.70(b) 4.65(b) --
1.70(b) 4.65(b) --
0.55(b) 5.80(b) --
1.00 4.25 N/A
1.70 3.55 --
1.70 3.56 --
0.55 4.70 --
1.00 4.57 N/A
1.70 3.83 --
0.55 4.99 --
1.70(b) 3.57(b) --
1.00 4.67 N/A
0.55 5.13 --
1.70(b) 3.92(b) --
1.00(b) 4.49(b) N/A
0.55(b) 4.56(b) --
</Table>
C-7
PART B
STATEMENT OF ADDITIONAL INFORMATION
DATED DECEMBER , 2001
ACQUISITION OF THE ASSETS OF
FORTIS ASSET ALLOCATION PORTFOLIO
FORTIS GLOBAL GROWTH PORTFOLIO
FORTIS GROWTH & INCOME FUND
FORTIS HIGH YIELD PORTFOLIO
FORTIS INTERNATIONAL EQUITY PORTFOLIO
FORTIS MONEY FUND
EACH A SERIES OF
HARTFORD - FORTIS SERIES FUND, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164
(800) 738-4000
BY AND IN EXCHANGE FOR SHARES OF
THE HARTFORD ADVISERS FUND
THE HARTFORD GLOBAL LEADERS FUND
THE HARTFORD GROWTH AND INCOME FUND
THE HARTFORD HIGH YIELD FUND
THE HARTFORD INTERNATIONAL OPPORTUNITIES FUND
THE HARTFORD MONEY MARKET FUND
EACH A SERIES OF
THE HARTFORD MUTUAL FUNDS, INC.
500 BIELENBERG DRIVE, WOODBURY, MINNESOTA 55125
MAILING ADDRESS: P.O. BOX 64284, ST. PAUL, MINNESOTA 55164
(888) 843-7824
This Statement of Additional Information relates specifically to the
reorganization of the series of Fortis Series Fund, Inc. referenced above (each
a "Fortis Fund") into the above-referenced series of The Hartford Mutual Funds,
Inc. (each a "Hartford Fund"). Pursuant to this reorganization, each Hartford
Fund would acquire all of the assets of a Fortis Fund that has a substantially
similar investment objective and substantially identical investment strategies
and risks, and Hartford Fund shares would be distributed pro rata by each Fortis
Fund to the holders of its shares, in complete liquidation of the Fortis Fund.
For the name of the Hartford Fund into which your Fortis Fund would be
reorganized, see the "Summary -- About the Proposed Reorganization" in the
Prospectus/Proxy Statement dated December __, 2001.
This Statement of Additional Information consists of this cover page and
the following documents, of which items 1 through 8 are incorporated by
reference herein:
1. The Statement of Additional Information dated December 1, 2001 of
Fortis Series Fund, Inc. (now known as Hartford - Fortis Series Fund,
Inc.) included in the Post-Effective Amendment to the Registration
Statement on Form N-1A of Fortis Series Fund, Inc. filed on November
30, 2001, (SEC File Nos. 002-11387/811-00558), previously filed on
EDGAR, Accession Number 0000950137-01-504943.
2. The Statement of Additional Information dated May 1, 2001 of The
Hartford Mutual Funds, Inc., included in the Post-Effective
Amendment to the Registration Statement on Form N-1A of The
Hartford Mutual Funds, Inc. filed on April 30, 2001, (SEC File Nos.
333-02381/811-07589), previously filed on EDGAR, Accession Number
0000950133-01-500819.
3. The audited financial statements of Fortis Money Fund included in
the Fortis Money Fund Annual Report for the fiscal year ended
September 30, 2001, previously filed on EDGAR, Accession Number
0000912057-01-540063.
4. The audited financial statements of Fortis Asset Allocation Portfolio
and Fortis Growth & Income Fund included in the Fortis Stock Funds
Annual Report for the fiscal year ended August 31, 2001, previously
filed on EDGAR, Accession Number 0000912057-01-536560.
5. The audited financial statements of Fortis Global Growth Portfolio and
Fortis International Equity Portfolio included in the Fortis
International Stock Funds Annual Report for the fiscal year ended
October 31, 2000, previously filed on EDGAR, Accession Number
0000912057-00-054224.
6. The unaudited financial statements of Fortis Global Growth Portfolio
and Fortis International Equity Portfolio included in the Fortis
International Stock Funds Semiannual Report for the six months ended
April 30, 2001, previously filed on EDGAR, Accession Number
0000912057-01-520216.
7. The audited financial statement of Fortis High Yield Portfolio
included in the Fortis Bond Funds Annual Report for the fiscal year
ended July 31, 2001, previously filed on EDGAR, Accession Number
0000912057-01-532576.
8. The audited financial statements of The Hartford Advisers Fund, The
Hartford Global Leaders Fund, The Hartford Growth and Income Fund, The
Hartford High Yield Fund, The Hartford International Opportunities
Fund and The Hartford Money Market Fund included in the Annual Report
of The Hartford Mutual Funds, Inc. for the fiscal year ended October
31, 2001; previously filed on EDGAR, Accession Number
0000950135-01-503842.
9. Financial Statements required by Form N-14, Item 14 (to the extent not
included in items 3 through 9 above).
This Statement of Additional Information dated December __, 2001 is not a
prospectus. A Prospectus/Proxy Statement dated December __, 2001 relating to the
above-referenced matters may be obtained from the Hartford Funds or the Fortis
Funds at the addresses and telephone numbers shown above. This Statement of
Additional Information should be read in conjunction with such Prospectus/Proxy
Statement.
2
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
FORTIS ASSET ALLOCATION (ACQUIRED)
HARTFORD ADVISERS FUND (ACQUIRING)
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/2001 10/31/2001 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- -----------
ASSETS
Investments, at value $222,943 $2,231,662 0 $2,454,605
Cash, receivables and other assets 1,410 24,523 0 25,933
Collateral for securities lending transactions 0 249,066 0 249,066
---------- ----------- ---------- -----------
TOTAL ASSETS 224,353 2,505,251 0 2,729,604
---------- ----------- ---------- -----------
LIABILITIES
Payable upon return of securities loaned 0 249,066 0 249,066
Payable for investment securities purchased 0 6,923 0 6,923
Redemptions of capital stock 33 2,394 0 2,427
Accounts payable and accrued expenses 246 977 0 1,223
---------- ----------- ---------- -----------
TOTAL LIABILITIES 279 259,360 0 259,639
---------- ----------- ---------- -----------
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 237,789 2,442,527 0 2,680,316
Unrealized appreciation (depreciation) of investments
in securities (11,858) (133,175) 0 (145,033)
Undistributed net investment income 225 3,162 0 3,387
Accumulated net realized loss from sale of investments (2,083) (66,623) 0 (68,706)
---------- ----------- ---------- -----------
TOTAL NET ASSETS $224,074 $2,245,891 0 $2,469,965
========== =========== ========== ===========
OUTSTANDING SHARES
Class A 10,755,133 75,719,253 (18,194) (A) 86,456,192
Class B 1,638,505 43,726,969 2,515,799 (A) 47,881,273
Class C 756,693 33,286,046 (22,643) (A) 34,020,096
Class H 2,584,675 0 (2,584,675) (A) 0
Class Y 0 3,875,798 0 (A) 3,875,798
Class Z 164,162 0 (164,162) (A) 0
15,899,168 156,608,066 (273,875) (A) 172,233,359
NET ASSET VALUE
Class A $14.14 $14.38 $14.38
Class B $14.02 $14.24 $14.24
Class C $13.94 $14.37 $14.37
Class H $14.00 $0.00 $0.00
Class Y $0.00 $14.54 $14.54
Class Z $14.13 $0.00 $0.00
(a) Reflects increase (decrease) in shares due to differences in the
net asset values of the funds. Fortis Class H will merge to Hartford
Class B, Fortis Class Z will merge to Hartford Class A.
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001 (Unaudited)
FORTIS ASSET ALLOCATION (ACQUIRED)
HARTFORD ADVISERS FUND (ACQUIRING
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/01 10/31/01 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- --------
NET INVESTMENT INCOME:
Income
Interest Income $6,597 $53,502 0 $60,099
Dividend Income 1,753 15,383 0 17,136
Fee income 53 751 0 804
-------- --------- ---- ---------
Total Income 8,403 69,636 0 78,039
-------- --------- ---- ---------
Expenses:
Investment advisory and management fees 2,217 14,009 (697) (A) 15,529
Transfer agent fees 0 4,715 560 (A) 5,275
Distribution fees 1,554 14,521 (164) (A) 15,911
Registration fees 75 396 (33) (A) 438
Custodian fees, gross 36 20 (37) (A) 19
Custodian fees, expense offset 0 (6) 0 (6)
Accounting services 0 417 51 (A) 468
Directors' fees and expenses 22 10 (22) (A) 10
Other 67 389 (21) (A) 435
-------- --------- ---- ---------
Total expenses (before reimbursements and waivers) 3,970 34,471 (363) 38,078
Expense reimbursements 0 0 0 0
Class A distribution fees waived 0 (503) (88) (A) (591)
-------- --------- ---- ---------
Total expenses, net 3,970 33,968 (451) 37,487
-------- --------- ---- ---------
NET INVESTMENT INCOME (LOSS) 4,433 35,668 451 40,552
-------- --------- ---- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss from investments (4,389) (66,684) 0 (71,073)
Net change in unrealized appreciation (depreciation) of
investments (38,894) (223,962) 0 (262,856)
-------- --------- ---- ---------
NET LOSS ON INVESTMENTS (43,282) (290,646) 0 (333,928)
-------- --------- ---- ---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ($38,850) ($254,978) $451 ($293,377)
======== ========= ==== =========
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. -- Asset Allocation
Portfolio (Acquired Fund) by The Hartford Mutual Funds, Inc. -- Hartford
Advisers Fund (Acquiring Fund) as if such acquisition had taken place as of the
close of business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Investments in securities traded on a national securities
exchange (domestic or foreign) or on the NASDAQ National Market System are
valued at the last reported sales price. Securities for which over-the-counter
market quotations are readily available are valued on the basis of the last
current bid price. An outside pricing service may be utilized to provide such
valuations. For fixed income securities, the pricing service may employ a matrix
system to determine valuations using methods which include consideration of
yields or prices of bonds of comparable quality, type of issue, coupon, maturity
and rating indications as to value from dealers, and general market conditions.
Options are valued at the last sales price. If no sale took place on such day,
then options are valued at the mean between the bid and asked prices. Securities
for which market quotations are not readily available are valued at fair value
as determined in good faith by management under supervision of the Board of
Directors. Short-term investments, with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are valued at
amortized cost.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date, except that certain dividends for foreign securities where the
ex-dividend date may have passed are recorded as soon as the Fund is informed of
the dividend in the exercise of reasonable diligence. Interest income and
expenses are recorded on the accrual basis. Realized security gains and losses
are determined using the identified cost method.
LENDING OF PORTFOLIO SECURITIES: At October 31, 2001, securities were on loan to
brokers from the Funds. For collateral, the Funds' custodian received cash,
which is maintained in a separate account and invested by the custodian in
short-term investment vehicles. The risks to the Funds in security lending
transactions are that the borrower may not provide additional collateral when
required or return the securities when due and that the proceeds from the sale
of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by Wellington
Management Company LLP (Wellington). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security (ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FUTURES, OPTIONS ON FUTURES AND OPTIONS TRANSACTIONS: A futures contract is an
agreement between two parties to buy and sell a security at a set price on a
future date. When the Funds enter into such contracts, they are required to
deposit with their custodian an amount of "initial margin" of cash, commercial
paper or U.S. Treasury Bills. Subsequent payments, called maintenance margin, to
and from the broker, are made on a daily basis as the price of the underlying
security fluctuates, making the long and short positions in the futures contract
more or less valuable (i.e. mark-to-market), which results in an unrealized gain
or loss to the Funds. The market value of a traded futures contract is the last
sale price. In the absence of a last sale price, the last offering price is
used. In the absence of either of these prices, fair value is determined
according to procedures established by the Funds' Board of Directors. At any
time prior to expiration of the futures contract, the Funds may close the
position by taking an opposite position, which would operate to terminate the
position in the futures contract. A final determination of the maintenance
margin is then made, additional cash is required to be paid by or released to
the Funds and the Funds realize a gain or loss. The use of futures contracts
involve elements of market and counter party risk, which may exceed the amount
recognized in the Statements of Net Assets (Assets and Liabilities). Change in
the value of the futures contracts may decrease the effectiveness of a Fund's
strategies and potentially result in loss.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's Statement of Net Assets (Schedule of Investments) as an investment
and subsequently "marked-to-market" through net unrealized appreciation
(depreciation) of options to reflect the current market value of the option as
of the end of the reporting period. If a purchased option expires on its
stipulated expiration date, the Fund realizes a loss in the amount of the cost
of the option. If the Fund exercises a put option, it realizes a gain or loss
from the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. If the Fund exercises a call option,
the cost of the security, which the Fund purchases upon exercise, will be
increased by the premium originally paid to buy the call.
The Funds may write covered options. "Covered" means that so long as a Fund is
obligated as the writer of an option, it will own either the underlying
securities or currency or the option to purchase or sell the same underlying
securities or currency having the expiration date of the covered option and an
exercise price equal to or less than the exercise price of the covered option,
or will establish or maintain with it's custodian for the term of the option a
"segregated account" consisting of cash or other liquid securities having a
value equal to the fluctuating market value of the option securities or
currencies. A Fund receives a premium for writing a call or put option, recorded
as a component of other liabilities on the Statement of Net Assets (Assets and
Liabilities), which increases the Funds' return, recorded as a realized gain, if
the option expires unexercised or is closed out at a net profit. Any loss
realized from the covered option is offset by the gain realized on the sale of
the underlying securities or currency. Covered options, at times before exercise
or close out, are marked-to-market through net unrealized appreciation
(depreciation) of options. There is a risk of loss from a change in value of
such options, which may exceed the related premiums received.
INDEXED SECURITIES: The Acquiring Fund may invest in indexed securities whose
values are linked to changes in interest rates, indices, or other underlying
instruments. The Acquiring Fund uses these securities to increase or decrease
it's exposure to different underlying instruments and to gain
exposure to markets that might be difficult to invest through conventional
securities. Indexed securities may be more volatile than their underlying
instruments, but any loss is limited to the amount of the original investment
and there is a limit to the potential appreciation of the investment.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Funds to pay
quarterly distributions from net investment income. The distributions are
recorded on the record date and are payable in cash or reinvested in additional
shares of the fund at net asset value without any charge to the shareholder.
Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: Each Fund is permitted to invest up to 15% of its net
assets in illiquid securities. "Illiquid Securities" are those that may not be
sold or disposed of in the ordinary course of business, at approximately the
price used to determine a Fund's net asset value per share. Each Fund may also
purchase certain restricted (unregistered) securities, commonly known as Rule
144A securities, that can be resold to institutions and which may be determined
to be liquid pursuant to policies and guidelines established by the Fund's Board
of Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with Wellington for the provision of day
to day investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate Wellington. The Acquiring Fund's investment
advisory and management fees are computed at an annual rate of .75% of the first
$500 million of average daily net assets, .65% for the next $500 million, and
.60% for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be used to compensate those
who sell shares of the fund and to pay certain other expenses of selling fund
shares. The Class A Rule 12b-1 fee for the Acquiring Fund has been voluntarily
capped at .30% through at least February 28, 2003. The cap may be removed at any
time thereafter. There is no distribution plan for Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2002. For Class A the limit is 1.40%, Classes B and C the limit is 2.10% and for
Class Y the limit is .95%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2002 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO and/or The Hartford or its subsidiaries. No
officer of the Funds receives any compensation directly from the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001(UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
COMMON STOCK
"FOOD, BEVERAGE & TOBACCO"
34 395 429 Coca-Cola Co. $1,642 $18,913 $20,555
78 539 617 Pepsico, Inc. $3,819 $26,250 $30,069
TOTAL FOR INDUSTRY: "FOOD, BEVERAGE & TOBACCO" $5,461 $45,163 $50,624
"METALS, MINERALS & MINING"
0 250 250 "Illinois Tool Works, Inc." $ 0 $14,300 $14,300
57 630 687 Alcoa, Inc. $1,836 $20,330 $22,166
TOTAL FOR INDUSTRY: "METALS, MINERALS & MINING" $1,836 $34,630 $36,466
AEROSPACE & DEFENSE
0 677 677 "General Motors Corp., Class H" $ 0 $9,309 $ 9,309
BANKS
52 550 602 American Express Co. $1,527 $16,187 $17,714
50 420 470 Bank One Corp. $1,663 $13,940 $15,603
106 981 1,087 Citigroup, Inc. $4,839 $44,651 $49,490
46 400 446 FleetBoston Financial Corp. $1,498 $13,144 $14,642
68 600 668 J.P. Morgan Chase & Co. $2,390 $21,216 $23,606
50 460 510 State Street Corp. $2,295 $20,948 $23,243
76 800 876 U.S. Bancorp (with rights) $1,351 $14,224 $15,575
PAGE 1 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: BANKS $15,563 $144,310 $159,873
BUSINESS SERVICES
90 500 590 Accenture Ltd. Class A $ 1,581 $ 8,785 $ 10,366
CHEMICALS
52 485 537 Dow Chemical Co. $ 1,724 $ 16,120 $ 17,844
COMMUNICATIONS
0 6 6 "McDATA Corp., Class A" $ 0 $ 94 $ 94
0 335 335 "Verizon Communications, Inc." $ 0 $ 16,686 $ 16,686
48 400 448 Qwest Communications
International, Inc. $ 628 $ 5,180 $ 5,808
66 433 499 SBC Communications, Inc. $ 2,515 $ 16,498 $ 19,013
128 1,099 1,227 WorldCom, Inc. - WorldCom Group
(with rights) $ 1,719 $ 14,785 $ 16,504
TOTAL FOR INDUSTRY: COMMUNICATIONS $ 4,862 $ 53,243 $ 58,105
COMPUTERS & OFFICE EQUIPMENT
132 1,216 1,348 Cisco Systems, Inc.
(with rights) $ 2,232 $ 20,570 $ 22,802
130 1,017 1,147 Compaq Computer Corp. $ 1,138 $ 8,896 $ 10,034
72 714 786 EMC Corp. $ 887 $ 8,792 $ 9,679
32 261 293 International Business
Machines Corp. $ 3,415 $ 28,195 $ 31,610
100 883 983 Solectron Corp.
(with rights) $ 1,230 $ 10,857 $ 12,087
PAGE 2 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001(UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: COMPUTERS & OFFICE EQUIPMENT $ 8,902 $ 77,310 $ 86,212
CONSUMER NON-DURABLES
40 300 340 Gillette Co. $ 1,244 $ 9,327 $ 10,571
67 661 728 Safeway, Inc. $ 2,799 $ 27,547 $ 30,346
67 440 507 Tyco International Ltd.
(with rights) $ 3,292 $ 21,622 $ 24,914
TOTAL FOR INDUSTRY: CONSUMER NON-DURABLES $ 7,335 $ 58,496 $ 65,831
DRUGS
51 400 451 Abbott Laboratories (with rights) $ 2,707 $ 21,192 $ 23,899
46 437 483 American Home Products Corp.
(with rights) $ 2,540 $ 24,392 $ 26,932
46 424 470 Bristol-Myers Squibb Co. $ 2,453 $ 22,663 $ 25,116
42 378 420 Merck & Co., Inc. $ 2,667 $ 24,120 $ 26,787
82 748 830 Pfizer, Inc. $ 3,448 $ 31,350 $ 34,798
52 300 352 Pharmacia Corp. (with rights) $ 2,087 $ 12,160 $ 14,247
65 584 649 Schering-Plough Corp.
(with rights) $ 2,428 $ 21,713 $ 24,141
TOTAL FOR INDUSTRY: DRUGS $18,330 $157,590 $175,920
ELECTRONICS
32 260 292 Emerson Electric Co. $ 1,574 $ 12,745 $ 14,319
103 1,285 1,388 General Electric Co. $ 3,743 $ 46,783 $ 50,526
114 1,015 1,129 Intel Corp. $ 2,772 $ 24,786 $ 27,558
49 395 444 Texas Instruments, Inc.
(with rights) $ 1,369 $ 11,056 $ 12,425
PAGE 3 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: ELECTRONICS $9,458 $ 95,370 $104,828
ENERGY
26 0 26 Phillips Petroleum Co. $1,420 $ 0 $ 1,420
ENERGY & SERVICES
0 400 400 "Conoco, Inc." $ 0 $ 10,280 $ 10,280
25 271 296 Anadarko Petroleum Corp.
(with rights) $1,426 $ 15,449 $ 16,875
0 154 154 ChevronTexaco Corp. $ 0 $ 13,637 $ 13,637
129 1,161 1,290 Exxon Mobil Corp. $5,081 $ 45,801 $ 50,882
40 348 388 Schlumberger Ltd. $1,951 $ 16,865 $ 18,816
TOTAL FOR INDUSTRY: ENERGY & SERVICES $8,458 $102,032 $110,490
FINANCE
24 0 24 Dime Bancorp, Inc.
(Warrants) $ 5 $ 0 $ 5
32 0 32 Golden West Financial Corp. $1,550 $ 0 $ 1,550
TOTAL FOR INDUSTRY: FINANCE $1,555 $ 0 $ 1,555
FINANCIAL SERVICES
46 483 529 Franklin Resources, Inc. $1,486 $ 15,488 $ 16,974
49 452 501 Merrill Lynch & Co., Inc. $2,146 $ 19,774 $ 21,920
TOTAL FOR INDUSTRY: FINANCIAL SERVICES $3,632 $ 35,262 $ 38,894
FOREST & PAPER PRODUCTS
PAGE 4 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
46 200 246 International Paper Co. $1,636 $ 7,160 $ 8,796
38 340 378 Kimberly-Clark Corp. $2,109 $18,851 $20,960
0 140 140 Weyerhaeuser Co. $ 0 $ 6,987 $ 6,987
TOTAL FOR INDUSTRY: FOREST & PAPER PRODUCTS $3,745 $32,998 $36,743
HEALTH CARE
35 0 35 McKesson, Inc. $1,295 $ 0 $ 1,295
HEALTH SERVICES
42 462 504 HCA, Inc. $1,662 $18,307 $19,969
HOTELS & GAMING
23 125 148 Marriott International, Inc.
Class A $ 721 $ 3,916 $ 4,637
INSURANCE
42 400 442 American International Group, Inc. $3,333 $31,438 $34,771
34 339 373 Marsh & McLennan Companies, Inc. $3,260 $32,827 $36,087
TOTAL FOR INDUSTRY: INSURANCE $6,593 $64,265 $70,858
MACHINERY
29 272 301 United Technologies Corp. $1,552 $14,663 $16,215
PAGE 5 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
MEDIA & ENTERTAINMENT
26 448 474 Gannett Co., Inc. (with rights) $1,643 $28,314 $29,957
130 1,300 1,430 Liberty Media Corp. Class A $1,526 $15,197 $16,723
44 425 469 Viacom, Inc. Class B $1,599 $15,517 $17,116
TOTAL FOR INDUSTRY: MEDIA & ENTERTAINMENT $4,768 $59,028 $63,796
MEDICAL INSTRUMENTS & SUPPLIES
56 380 436 Johnson & Johnson $3,243 $22,006 $25,249
RETAIL
40 460 500 CVS Corp. $ 956 $10,994 $11,950
64 600 664 Home Depot, Inc. $2,431 $22,938 $25,369
74 703 777 Wal-Mart Stores, Inc. $3,793 $36,139 $39,932
TOTAL FOR INDUSTRY: RETAIL $7,180 $70,071 $77,251
SERVICES
39 0 39 Comcast Corp. Special Class A $1,398 $ 0 $ 1,398
SOFTWARE & SERVICES
96 900 996 AOL Time Warner, Inc.
(with rights) $3,006 $28,089 $31,095
32 300 332 Automatic Data Processing, Inc. $1,653 $15,498 $17,151
PAGE 6 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 283 283 Computer Sciences Corp. $ 0 $ 10,159 $ 10,159
46 420 466 i2 Technologies, Inc. $ 208 $ 1,915 $ 2,123
100 920 1,020 Microsoft Corp. $ 5,815 $ 53,498 $ 59,313
120 1,100 1,220 Oracle Corp. $ 1,620 $ 14,916 $ 16,536
TOTAL FOR INDUSTRY: SOFTWARE & SERVICES $ 12,302 $ 124,075 $ 136,377
TECHNOLOGY
0 0 0 @Track Communications, Inc.
(Warrants) $ 0 $ 0 $ 0
TRANSPORTATION
41 408 449 Boeing Co. $ 1,324 $ 13,301 $ 14,625
44 330 374 FedEx Corp. $ 1,787 $ 13,556 $ 15,343
TOTAL FOR INDUSTRY: TRANSPORTATION $ 3,111 $ 26,857 $ 29,968
UTILITIES
47 447 494 Duke Energy Corp. $ 1,821 $ 17,185 $ 19,006
44 450 494 El Paso Corp. $ 2,142 $ 22,077 $ 24,219
0 450 450 Exelon Corp. $ 0 $ 18,932 $ 18,932
35 296 331 FPL Group, Inc. $ 1,858 $ 15,707 $ 17,565
40 0 40 Reliant Energy, Inc. $ 1,118 $ 0 $ 1,118
TOTAL FOR INDUSTRY: UTILITIES $ 6,939 $ 73,901 $ 80,840
TOTAL FOR SEGMENT: COMMON STOCK $144,626 $1,347,707 $1,492,333
PAGE 7 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
ASSET BACKED SECURITIES
FINANCE
1,000 0 1,000 Citibank Credit Card
Master Trust I 6.900% 11/15/2006 $1,080 $ 0 $1,080
657 0 657 Money Store Home Improvement
Trust 7.410% 05/15/2017 $ 688 $ 0 $ 688
1,500 0 1,500 Standard Credit Card
Master Trust 8.450% 01/07/2007 $1,674 $ 0 $ 1,674
TOTAL FOR INDUSTRY: FINANCE $3,442 $ 0 $ 3,442
TOTAL FOR SEGMENT: ASSET BACKED SECURITIES $3,442 $ 0 $ 3,442
CORPORATE BONDS
"FOOD, BEVERAGE & TOBACCO"
0 4,906 4,906 "CanAgra Foods, Inc. (Baa1)" 6.700% 8/1/27 $ 0 $ 5,016 $ 5,016
0 3,000 3,000 "PepsiAmericas, Inc. (Baa1)" 6.375% 5/1/09 $ 0 $ 3,087 $ 3,087
0 7,000 7,000 "PepsiAmericas, Inc. (Baa1)" 5.950% 2/15/06 $ 0 $ 7,270 $ 7,270
0 5,000 5,000 Archer-Daniels-Midland Co. (A1) 7.000% 2/1/31 $ 0 $ 5,302 $ 5,302
0 2,000 2,000 Archer-Daniels-Midland Co. (A1) 8.125% 6/1/12 $ 0 $ 2,400 $ 2,400
0 2,000 2,000 Hershey Foods Corp. (A1) 7.200% 8/15/27 $ 0 $ 2,114 $ 2,114
TOTAL FOR INDUSTRY: "FOOD, BEVERAGE & TOBACCO" $ 0 $25,189 $25,189
"METALS, MINERALS & MINING"
0 7,000 7,000 "Alcoa, Inc. (A1)" 7.375% 8/1/10 $ 0 $ 7,886 $ 7,886
0 4,000 4,000 Vulcan Materials Co. (A1) 5.750% 4/1/04 $ 0 $ 4,143 $ 4,143
TOTAL FOR INDUSTRY: "METALS, MINERALS & MINING" $ 0 $12,029 $12,029
PAGE 8 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
BANKS
0 2,005 2,005 American Express Co. (A1) 6.875% 11/1/05 $ 0 $ 2,154 $ 2,154
0 500 500 Bank of America Corp. (Aa3) 7.875% 12/1/02 $ 0 $ 527 $ 527
0 3,000 3,000 Bank One Corp. (Aa3) 6.875% 8/1/06 $ 0 $ 3,240 $ 3,240
0 3,000 3,000 Bank One Corp. (Aa3) 6.500% 2/1/06 $ 0 $ 3,188 $ 3,188
0 2,000 2,000 Bayerische Landesbank
Girozentrale (NY) 5.650% 2/1/09 $ 0 $ 2,029 $ 2,029
0 545 545 First Union National Bank (A1) 5.800% 12/1/08 $ 0 $ 553 $ 553
0 2,755 2,755 Key Bank N.A. (A1) 5.800% 4/1/04 $ 0 $ 2,882 $ 2,882
0 3,000 3,000 Wachovia Corp. (A2) 5.625% 12/15/08 $ 0 $ 3,001 $ 3,001
0 5,000 5,000 Wells Fargo & Co. (Aa2) 6.500% 9/3/02 $ 0 $ 5,159 $ 5,159
TOTAL FOR INDUSTRY: BANKS $ 0 $22,733 $22,733
CAPITAL GOODS
250 0 250 Boeing Capital Corp.,
6.10%, 3-1-2011 6.100% 03/01/2011 $253 $ 0 $ 253
250 0 250 Northrop Grumman Corp.,
7.125%, 2-15-201 7.125% 02/15/2011 $264 $ 0 $ 264
TOTAL FOR INDUSTRY: CAPITAL GOODS $517 $ 0 $ 517
CHEMICALS
0 500 500 "ICI Wilmington, Inc. (Baa2)" 6.950% 9/15/04 $ 0 $ 531 $ 531
0 1,000 1,000 "Praxair, Inc. (A3)" 6.150% 4/15/03 $ 0 $ 1,033 $ 1,033
0 7,000 7,000 Rohm & Haas Co. (A3) 7.400% 7/15/09 $ 0 $ 7,751 $ 7,751
TOTAL FOR INDUSTRY: CHEMICALS $ 0 $ 9,315 $ 9,315
COMMUNICATIONS
PAGE 9 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 1,580 1,580 "Motorola, Inc. (A3)" 7.600% 1/1/07 $ 0 $ 1,608 $ 1,608
0 7,000 7,000 "WorldCom, Inc. (A3)" 6.400% 8/15/05 $ 0 $ 7,165 $ 7,165
0 3,000 3,000 AT&T Corp. (A3) 6.500% 3/15/29 $ 0 $ 2,593 $ 2,593
0 1,000 1,000 New York Telephone Co. (A1) 6.000% 4/15/08 $ 0 $ 1,033 $ 1,033
0 7,055 7,055 Sprint Capital Corp. (Baa1) 6.125% 11/15/08 $ 0 $ 7,111 $ 7,111
TOTAL FOR INDUSTRY: COMMUNICATIONS $ 0 $19,510 $19,510
COMPUTERS & OFFICE EQUIPMENT
0 2,000 2,000 "Pitney Bowes, Inc. (Aa3)" 5.500% 4/15/04 $ 0 $ 2,073 $ 2,073
0 5,000 5,000 Hewlett-Packard Co. (A2) 7.150% 6/15/05 $ 0 $ 5,378 $ 5,378
TOTAL FOR INDUSTRY: COMPUTERS & OFFICE EQUIPMENT $ 0 $ 7,451 $ 7,451
CONSUMER CYCLICAL
250 0 250 Abitibi Consolidated, Inc.,
8.85%, 8-1-2030 8.850% 08/01/2030 $ 252 $ 0 $ 252
500 0 500 DaimlerChrysler N.A.
Holding Corp. 7.400% 01/20/2005 $ 530 $ 0 $ 530
250 0 250 DaimlerChrysler N.A.
Holding Corp. 7.750% 01/18/2011 $ 259 $ 0 $ 259
250 0 250 Federated Department Stores, Inc. 6.300% 04/01/2009 $ 248 $ 0 $ 248
600 0 600 Georgia-Pacific Group,
9.625%, 3-15-2022 9.625% 03/15/2022 $ 606 $ 0 $ 606
250 0 250 Safeway, Inc., 7.25%, 2-1-2031 7.250% 02/01/2031 $ 271 $ 0 $ 271
250 0 250 Sysco Corp., 6.50%, 8-1-2028 6.500% 08/01/2028 $ 243 $ 0 $ 243
TOTAL FOR INDUSTRY: CONSUMER CYCLICAL $2,409 $ 0 $ 2,409
CONSUMER NON-DURABLES
0 2,500 2,500 Alberto-Culver Co. (Baa1) 8.250% 11/1/05 $ 0 $ 2,730 $ 2,730
PAGE 10 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 7,000 7,000 Clorox Co. (The) (A1) 6.125% 2/1/11 $ 0 $ 7,147 $ 7,147
0 2,000 2,000 Colgate-Palmolive Co. (Aa3) 5.580% 11/6/08 $ 0 $ 2,089 $ 2,089
0 7,000 7,000 Procter & Gamble Co. (The) (Aa3) 9.360% 1/1/21 $ 0 $ 9,309 $ 9,309
TOTAL FOR INDUSTRY: CONSUMER NON-DURABLES $ 0 $21,275 $21,275
CONSUMER STAPLES
250 0 250 Anheuser-Busch Companies, Inc.,
7.55%, 10-01-2030 7.550% 10/01/2030 $ 298 $ 0 $ 298
250 0 250 Coca-Cola Bottling Co., 6.375%,
5-1-2009 6.375% 05/01/2009 $ 259 $ 0 $ 259
250 0 250 Coca-Cola Enterprises, Inc.,
8.50%, 2-1-2022 8.500% 02/01/2022 $ 305 $ 0 $ 305
500 0 500 Pepsi Bottling Group, Inc.,
7.00%, Ser B 3-1-2029 7.000% 03/01/2029 $ 546 $ 0 $ 546
250 0 250 Proctor & Gamble Co.,
6.875%, 9-15-2009 6.875% 09/15/2009 $ 278 $ 0 $ 278
TOTAL FOR INDUSTRY: CONSUMER STAPLES $1,686 $ 0 $ 1,686
DRUGS
0 2,000 2,000 American Home Products Corp. (A3) 7.250% 3/1/23 $ 0 $ 2,073 $ 2,073
0 3,000 3,000 Pharmacia Corp. (A1) 6.600% 12/1/28 $ 0 $ 3,157 $ 3,157
TOTAL FOR INDUSTRY: DRUGS $ 0 $ 5,230 $ 5,230
ELECTRICAL EQUIPMENT
0 2,000 2,000 Danaher Corp. (A2) 6.000% 10/15/08 $ 0 $ 2,043 $ 2,043
0 5,000 5,000 Eaton Corp. (A2) 6.950% 11/15/04 $ 0 $ 5,386 $ 5,386
TOTAL FOR INDUSTRY: ELECTRICAL EQUIPMENT $ 0 $ 7,429 $ 7,429
ENERGY
500 0 500 Conoco, Inc., 6.95%, 4-15-2029 6.950% 04/15/2029 $ 504 $ 0 $ 504
PAGE 11 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
500 0 500 Texaco Capital, Inc.,
8.625%, 6-30-2010 8.625% 06/30/2010 $ 607 $ 0 $ 607
250 0 250 Valero Energy Corp.,
8.375%, 6-15-2005 8.375% 06/15/2005 $ 278 $ 0 $ 278
300 0 300 Williams Companies, Inc.,
7.50%, Ser A 1-15-2031 7.500% 01/15/2031 $ 299 $ 0 $ 299
TOTAL FOR INDUSTRY: ENERGY $1,688 $ 0 $ 1,688
ENERGY & SERVICES
0 7,000 7,000 Atlantic Richfield Co. (Aa1) 5.900% 4/15/09 $ 0 $ 7,278 $ 7,278
0 7,000 7,000 Enron Corp. (Baa2) 6.400% 7/15/06 $ 0 $ 5,439 $ 5,439
TOTAL FOR INDUSTRY: ENERGY & SERVICES $ 0 $12,717 $12,717
FINANCE
250 0 250 American General Corp.,
6.625%, 2-15-2029 6.625% 02/15/2029 $ 250 $ 0 $ 250
500 0 500 Aristar, Inc., 7.25%, 6-15-2006 7.250% 06/15/2006 $ 541 $ 0 $ 541
500 0 500 BankAmerica Corp., 6.20%, 2-15-2006 6.200% 02/15/2006 $ 528 $ 0 $ 528
500 0 500 Bear Stearns Capital Trust I,
7.00%, Variable, 1-15-2027 7.000% 01/15/2027 $ 503 $ 0 $ 503
250 0 250 British Columbia (Province of),
6.50%, Ser B, 1-15-2026 6.500% 01/15/2026 $ 266 $ 0 $ 266
500 0 500 BSCH Issuance Ltd.,
7.625%, 11-3-2009 7.625% 11/03/2009 $ 541 $ 0 $ 541
250 0 250 Capital One Bank, 6.875%, 2-1-2006 6.875% 02/01/2006 $ 251 $ 0 $ 251
750 0 750 CIT Group, Inc., 7.375%, 3-15-2003 7.375% 03/15/2003 $ 790 $ 0 $ 790
500 0 500 Citigroup, Inc., 6.50%, 1-18-2011 6.500% 01/18/2011 $ 533 $ 0 $ 533
250 0 250 Corp Andina de Fomento,
7.10%, 2-1-2003 7.100% 02/01/2003 $ 258 $ 0 $ 258
500 0 500 Ford Motor Co., 6.375%, 2-1-2029 6.375% 02/01/2029 $ 408 $ 0 $ 408
500 0 500 General Motors Acceptance Corp.,
6.15%, 4-5-2007 6.150% 04/05/2007 $ 495 $ 0 $ 495
500 0 500 Goldman Sachs Group, Inc.,
6.65%, 5-15-2009 6.650% 05/15/2009 $ 524 $ 0 $ 524
PAGE 12 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
250 0 250 Heller Financial, Inc.,
6.375%, 3-15-2006 6.375% 03/15/2006 $270 $0 $270
500 0 500 Household Finance Corp.,
6.00%, 5-1-2004 6.000% 05/01/2004 $527 $0 $527
500 0 500 Inter-American Development Bank,
7.375%, 1-15-2010 7.375% 01/15/2010 $588 $0 $588
500 0 500 International Bank for
Reconstruction & Deve 7.000% 01/27/2005 $554 $0 $554
500 0 500 J.P. Morgan Chase & Co.,
6.75%, 2-1-2011 6.750% 02/01/2011 $530 $0 $530
250 0 250 KeyCorp Capital II,
6.875%, 3-17-2029 6.875% 03/17/2029 $232 $0 $232
250 0 250 Korea (Republic of),
8.875%, 4-15-2008 8.875% 04/15/2008 $294 $0 $294
250 0 250 Korea Development Bank,
7.125%, 4-22-2004 7.125% 04/22/2004 $267 $0 $267
500 0 500 Lehman Brothers Holdings, Inc.,
7.875%, 11-1-2009 7.875% 11/01/2009 $556 $0 $556
500 0 500 Mellon Financial Corp.,
6.375%, 2-15-2010 6.375% 02/15/2010 $522 $0 $522
250 0 250 Morgan Stanley Dean Witter & Co.,
7.75%, 6-15-2005 7.750% 06/15/2005 $277 $0 $277
250 0 250 National City Corp.,
6.875%, 5-15-2019 6.875% 05/15/2019 $254 $0 $254
500 0 500 NBD Bancorp,
7.125%, 5-15-2007 7.125% 05/15/2007 $538 $0 $538
500 0 500 Ontario (Province of),
5.50%, 10-1-2008 5.500% 10/01/2008 $524 $0 $524
250 0 250 Poland (Republic of),
7.125%, 7-1-2004 7.125% 07/01/2004 $269 $0 $269
500 0 500 Prudential Insurance Co.,
6.375%, 7-23-2006 6.375% 07/23/2006 $527 $0 $527
500 0 500 Quebec (Province of),
7.50%, 9-15-2029 7.500% 09/15/2029 $586 $0 $586
500 0 500 ReliaStar Financial Corp.,
8.00%, 10-30-2006 8.000% 10/30/2006 $564 $0 $564
250 0 250 Republic New York Capital I,
7.75%, 11-15-2026 7.750% 11/15/2026 $254 $0 $254
500 0 500 Salomon Smith Barney Holdings,
Inc., 5.875%, 3-15-2006 5.875% 03/15/2006 $526 $0 $526
500 0 500 St. Paul Bancorp, Inc.,
7.125%, 2-15-2004 7.125% 02/15/2004 $531 $0 $531
200 0 200 State Street Corp.,
7.65%, 6-15-2010 7.650% 06/15/2010 $228 $0 $228
500 0 500 Textron Financial Corp.,
7.125%, 12-9-2004 7.125% 12/09/2004 $535 $0 $535
PAGE 13 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
500 0 500 Wells Fargo Bank, N.A.,
6.45%, 2-1-2011 6.450% 02/01/2011 $ 524 $ 0 $ 524
TOTAL FOR INDUSTRY: FINANCE $16,365 $ 0 $16,365
FINANCIAL SERVICES
0 2,000 2,000 "AXA Financial, Inc. (A2)" 7.000% 4/1/28 $ 0 $ 2,018 $ 2,018
0 2,000 2,000 Associates Corp. of North
America (Aa1) 6.000% 7/15/05 $ 0 $ 2,105 $ 2,105
0 2,725 2,725 ERAC USA Finance Co. (Baa1) 7.350% 6/15/08 $ 0 $ 2,809 $ 2,809
0 10,000 10,000 Financing Corp. (AAA S&P) 9.800% 4/6/18 $ 0 $14,682 $14,682
0 7,000 7,000 General Motors Acceptance
Corp. (A2) 8.000% 11/1/31 $ 0 $ 7,244 $ 7,244
0 2,000 2,000 Toyota Motor Credit Corp. (Aa1) 5.500% 12/15/08 $ 0 $ 2,040 $ 2,040
0 2,000 2,000 Transamerica Finance Corp. (A3) 6.125% 11/1/01 $ 0 $ 2,000 $ 2,000
0 5,000 5,000 USAA Capital Corp. (Aa1) 6.900% 11/1/02 $ 0 $ 5,213 $ 5,213
TOTAL FOR INDUSTRY: FINANCIAL SERVICES $ 0 $38,111 $38,111
FOREIGN CORPORATIONS
0 2,000 2,000 "Alcan, Inc. (A2)" 7.250% 11/1/28 $ 0 $ 2,124 $ 2,124
0 255 255 "Chilquinta Energia Finance
Co., LLC (Aaa)" 6.620% 4/1/11 $ 0 $ 266 $ 266
0 7,000 7,000 Apache Finance Property Ltd. (A3) 7.000% 3/15/09 $ 0 $ 7,488 $ 7,488
0 4,000 4,000 TXU Eastern Funding Co. (Baa1) 6.450% 5/15/05 $ 0 $ 4,152 $ 4,152
TOTAL FOR INDUSTRY: FOREIGN CORPORATIONS $ 0 $14,030 $14,030
FOREST & PAPER PRODUCTS
0 7,000 7,000 Westvaco Corp. (Baa1) 7.950% 2/15/31 $ 0 $ 7,251 $ 7,251
PAGE 14 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
HEALTH CARE
375 0 375 Bristol-Myers Squibb Co.,
6.80%, 11-15-2026 6.800% 11/15/2026 $412 $ 0 $ 412
150 0 150 Cardinal Health, Inc.,
6.75%, 2-15-2011 6.750% 02/15/2011 $162 $ 0 $ 162
TOTAL FOR INDUSTRY: HEALTH CARE $574 $ 0 $ 574
INSURANCE
0 2,000 2,000 "John Hancock Financial Services,
Inc. (A1)" 7.375% 2/15/24 $ 0 $2,069 $2,069
0 1,000 1,000 "MBIA, Inc. (Aa2)" 7.000% 12/15/25 $ 0 $ 994 $ 994
0 7,000 7,000 "Provident Cos., Inc. (Baa1)" 7.000% 7/15/18 $ 0 $6,863 $6,863
0 1,000 1,000 "UnitedHealth Group, Inc. (A3)" 6.600% 12/1/03 $ 0 $1,054 $1,054
0 3,000 3,000 ACE INA Holdings (A2) 8.300% 8/15/06 $ 0 $3,272 $3,272
0 2,000 2,000 Allmerica Financial Corp. (A2) 7.625% 10/15/25 $ 0 $2,081 $2,081
0 1,900 1,900 Allstate Corp. (The) (A1) 6.750% 6/15/03 $ 0 $2,007 $2,007
0 2,000 2,000 Allstate Corp. (The) (A1) 6.750% 5/15/18 $ 0 $2,046 $2,046
0 7,000 7,000 American Re Corp. (Aa1) 7.450% 12/15/26 $ 0 $7,604 $7,604
0 1,420 1,420 AmerUs Group Co. (Baa3) 6.950% 6/15/05 $ 0 $1,462 $1,462
0 1,000 1,000 CIGNA Corp. (A3) 6.375% 1/15/06 $ 0 $1,044 $1,044
0 1,260 1,260 CIGNA Corp. (A3) 7.400% 5/15/07 $ 0 $1,385 $1,385
0 2,000 2,000 Jackson National Life Insurance
Co. (A2) 8.150% 3/15/27 $ 0 $2,180 $2,180
0 1,000 1,000 Liberty Financial Co. (A3) 6.750% 11/15/08 $ 0 $1,102 $1,102
0 5,000 5,000 Liberty Mutual Insurance (A2) 8.200% 5/4/07 $ 0 $5,400 $5,400
0 2,000 2,000 New England Mutual Life Insurance
Co. (A1) 7.875% 2/15/24 $ 0 $2,067 $2,067
PAGE 15 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 2,000 2,000 Prudential Funding LLC (A2) 6.750% 9/15/23 $0 $ 1,894 $ 1,894
0 2,000 2,000 Torchmark Corp. (Baa1) 8.250% 8/15/09 $0 $ 2,188 $ 2,188
TOTAL FOR INDUSTRY: INSURANCE $0 $46,712 $46,712
MACHINERY
0 2,000 2,000 Parker Hannifin Corp. (A2) 5.650% 9/15/03 $0 $ 2,080 $ 2,080
0 7,000 7,000 United Technologies Corp. (A3) 7.125% 11/15/10 $0 $ 7,772 $ 7,772
TOTAL FOR INDUSTRY: MACHINERY $0 $ 9,852 $ 9,852
MEDIA & ENTERTAINMENT
0 7,000 7,000 "USA Networks, Inc. (Baa3)" 6.750% 11/15/05 $0 $ 7,327 $ 7,327
0 7,000 7,000 "Viacom, Inc. (A3)" 7.700% 7/30/10 $0 $ 7,814 $ 7,814
0 7,000 7,000 Comcast Cable Communications (Baa2) 6.875% 6/15/09 $0 $ 7,323 $ 7,323
0 500 500 Scripps (E.W.) Co. (The) (A2) 6.375% 10/15/02 $0 $ 513 $ 513
0 3,000 3,000 Washington Post Co. (Aa3) 5.500% 2/15/09 $0 $ 3,005 $ 3,005
TOTAL FOR INDUSTRY: MEDIA & ENTERTAINMENT $0 $25,982 $25,982
MEDICAL INSTRUMENTS & SUPPLIES
0 2,000 2,000 "Becton, Dickinson & Co. (A2)" 6.700% 8/1/28 $0 $ 2,002 $ 2,002
RETAIL
0 4,000 4,000 "Albertson's, Inc. (Baa1)" 6.550% 8/1/04 $0 $ 4,245 $ 4,245
0 5,000 5,000 "Home Depot, Inc. (The) (Aa3)" 6.500% 9/15/04 $0 $ 5,416 $ 5,416
0 6,000 6,000 "Wal-Mart Stores, Inc. (Aa2)" 6.875% 8/10/09 $0 $ 6,708 $ 6,708
PAGE 16 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 1,345 1,345 Target Corp. (A2) 5.875% 11/1/08 $ 0 $ 1,398 $ 1,398
TOTAL FOR INDUSTRY: RETAIL $ 0 $17,767 $17,767
SERVICES
250 0 250 AT&T Corp. - Liberty Media Corp. 8.250% 02/01/2030 $ 233 $ 0 $ 233
250 0 250 Clear Channel Communications, Inc. 7.650% 09/15/2010 $ 264 $ 0 $ 264
500 0 500 Comcast Cable Communications, Inc. 8.500% 05/01/2027 $ 564 $ 0 $ 564
500 0 500 Cox Communications, Inc.,
6.40%, 8-1-2008 6.400% 08/01/2008 $ 523 $ 0 $ 523
500 0 500 Park Place Entertainment Corp.,
8.50%, 11-15-2006 8.500% 11/15/2006 $ 521 $ 0 $ 521
500 0 500 Viacom, Inc., 7.625%, 1-15-2016 7.625% 01/15/2016 $ 568 $ 0 $ 568
250 0 250 Waste Management, Inc.,
7.375%, 8-1-2010 7.375% 08/01/2010 $ 267 $ 0 $ 267
TOTAL FOR INDUSTRY: SERVICES $2,940 $ 0 $2,940
SOFTWARE & SERVICES
0 1,000 1,000 "Computer Associates
International, Inc. (Baa) 6.500% 4/15/08 $ 0 $ 967 $ 967
TECHNOLOGY
250 0 250 AirTouch Communications, Inc.,
6.65%, 5-1-2008 6.650% 05/01/2008 $ 261 $ 0 $ 261
500 0 500 ALLTEL Corp., 6.80%, 5-1-2029 6.800% 05/01/2029 $ 445 $ 0 $ 445
750 0 750 AT&T Corp., 6.00%, 3-15-2009 6.000% 03/15/2009 $ 729 $ 0 $ 729
250 0 250 AT&T Wireless Services, Inc.,
8.75 %, 3-1-2031 8.750% 03/01/2031 $ 284 $ 0 $ 284
250 0 250 Deutsche Telekom International
Financial BV 8.250% 06/15/2030 $ 277 $ 0 $ 277
250 0 250 France Telecom, 7.75%, 3-1-2011 7.750% 03/01/2011 $ 273 $ 0 $ 273
PAGE 17 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
250 0 250 GTE Corp., 7.51%, 4-1-2009 7.510% 04/01/2009 $ 277 $ 0 $ 277
250 0 250 Koninklijke KPN N.V.,
8.375%, 10-1-2030 8.375% 10/01/2030 $ 197 $ 0 $ 197
500 0 500 Lockheed Martin Corp.,
7.65%, 5-1-2016 7.650% 05/01/2016 $ 586 $ 0 $ 586
400 0 400 Raytheon Co., 7.20%, 8-15-2027 7.200% 08/15/2027 $ 403 $ 0 $ 403
250 0 250 Sprint Capital Corp.,
6.875%, 11-15-2028 6.875% 11/15/2028 $ 228 $ 0 $ 228
250 0 250 Sprint Capital Corp.,
7.625%, 1-30-2011 7.625% 01/30/2011 $ 265 $ 0 $ 265
250 0 250 Telecomunicaciones de Puerto
Rico, Inc. 6.650% 05/15/2006 $ 258 $ 0 $ 258
500 0 500 Telefonica Europe BV,
7.35%, 9-15-2005 7.350% 09/15/2005 $ 536 $ 0 $ 536
500 0 500 Time Warner, Inc.,
6.875%, 6-15-2018 6.875% 06/15/2018 $ 499 $ 0 $ 499
250 0 250 Tyco International Group S.A.,
6.875%, 1-15-2029 6.875% 01/15/2029 $ 250 $ 0 $ 250
750 0 750 US West Communications,
7.20%, 11-1-2004 7.200% 11/01/2004 $ 792 $ 0 $ 792
250 0 250 Verizon Global Funding Corp.,
7.25%, 12-1-2010 7.250% 12/01/2010 $ 274 $ 0 $ 274
250 0 250 Verizon Global Funding Corp.,
7.75%, 12-1-2030 7.750% 12/01/2030 $ 282 $ 0 $ 282
500 0 500 Vodafone Group plc,
7.875%, Ser B 2-15-2030 7.875% 02/15/2030 $ 570 $ 0 $ 570
750 0 750 WorldCom, Inc.,
6.125%, 4-15-2002 6.125% 04/15/2002 $ 759 $ 0 $ 759
TOTAL FOR INDUSTRY: TECHNOLOGY $8,445 $ 0 $8,445
TRANSPORTATION
0 6,000 6,000 Burlington Northern Santa Fe Corp.
(Baa2) 7.875% 4/15/07 $ 0 $6,756 $6,756
750 0 750 CSX Corp., 7.90%, 5-1-2017 7.900% 05/01/2017 $ 856 $ 0 $ 856
0 5,000 5,000 DaimlerChrysler North America
Holding Corp 7.125% 4/10/03 $ 0 $5,182 $5,182
0 7,000 7,000 Ford Motor Co. (A3) 6.625% 10/1/28 $ 0 $5,909 $5,909
250 0 250 Norfolk Southern Corp.,
6.75%, 2-15-2011 6.750% 02/15/2011 $ 263 $ 0 $ 263
0 2,000 2,000 Rockwell International Corp. (A3) 6.700% 1/15/28 $ 0 $1,886 $1,886
PAGE 18 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND: FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: TRANSPORTATION $1,119 $19,733 $20,852
UTILITIES
0 2,000 2,000 "Great Plains Energy, Inc. (A2)" 7.125% 12/15/05 $ 0 $ 2,136 $ 2,136
0 500 500 "Williams Cos., Inc. (The) (Baa2)" 6.500% 11/15/02 $ 0 $ 514 $ 514
0 4,000 4,000 Alabama Power Co. (A2) 7.125% 8/15/04 $ 0 $ 4,325 $ 4,325
500 0 500 Alabama Power Co.,
7.125%, Ser L 10-1-200 7.125% 10/01/2007 $ 549 $ 0 $ 549
0 200 200 Allegheny Energy Supply (Baa1) 7.800% 3/15/11 $ 0 $ 217 $ 217
500 0 500 CMS Panhandle Holding Co. 7.000% 07/15/2029 $ 448 $ 0 $ 448
250 0 250 Dominion Fiber Ventures LLC 7.050% 03/15/2005 $ 261 $ 0 $ 261
0 4,000 4,000 Duke Energy Corp. (A1) 5.375% 1/1/09 $0 $ 3,952 $ 3,952
500 0 500 Duke Energy Corp.,
6.00%, Ser A 12-1-2028 6.000% 12/01/2028 $ 454 $ 0 $ 454
250 0 250 El Paso Energy Corp.,
8.05%, 10-15-2030 8.050% 10/15/2030 $ 265 $ 0 $ 265
250 0 250 Enron Corp., 7.375%, 5-15-2019 05/15/2019 $ 187 $ 0 $ 187
500 0 500 Madison Gas & Electric Co. 6.020% 09/15/2008 $ 508 $ 0 $ 508
0 4,000 4,000 National Fuel Gas Co. (A2) 6.000% 3/1/09 $ 0 $ 3,970 $ 3,970
189 0 189 Niagara Mohawk Power Co.,
7.625%, Ser F 7.625% 10/01/2005 $ 205 $ 0 $ 205
0 1,150 1,150 Northern Border Pipeline Co. (A3) 7.750% 9/1/09 $ 0 $ 1,218 $ 1,218
250 0 250 Tennessee Gas Pipeline Co.,
7.50%, 4-1-2017 7.500% 04/01/2017 $ 259 $ 0 $ 259
250 0 250 TransCanada Pipelines Ltd. 6.490% 01/21/2009 $ 260 $ 0 $ 260
500 0 500 TXU Electric Capital V, 8.175%,
1-30-2037 8.175% 01/30/2037 $ 588 $ 0 $ 588
TOTAL FOR INDUSTRY: UTILITIES $3,984 $16,332 $20,316
PAGE 19 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR SEGMENT: CORPORATE BONDS $39,727 $341,617 $381,344
U.S. GOVERNMENT SECURITIES
FEDERAL NATIONAL MORTGAGE
ASSOCIATION
264 0 264 FNMA 6.30% #380269 4-1-2008 6.300% 04/01/2008 $ 285 $ 0 $ 285
1,625 0 1,625 FNMA 7.25% 5-15-2030 7.250% 05/15/2030 $ 1,998 $ 0 $ 1,998
43 0 43 FNMA 9.00% #038270 11-1-2016 9.000% 11/01/2016 $ 47 $ 0 $ 47
34 0 34 FNMA 9.00% #115286 3-1-2021 9.000% 03/01/2021 $ 37 $ 0 $ 37
TOTAL FOR INDUSTRY: FEDERAL NATIONAL MORTGAGE
ASSOCIATION $ 2,367 $ 0 $ 2,367
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION
0 416,708 416,708 5.00% due 02/15/11 $ 0 $455,556 $455,556
298 0 298 GNMA #465193 8.00%, 5-15-2030 8.000% 05/15/2030 $ 316 $ 0 $ 316
172 0 172 GNMA #520976 7.50%, 9-15-2030 7.500% 09/15/2030 $ 181 $ 0 $ 181
590 0 590 GNMA 9.00% #341679 1-15-2023 9.000% 01/15/2023 $ 645 $ 0 $ 645
16 0 16 GNMA 9.50% #256373 10-15-2019 9.500% 10/15/2019 $ 17 $ 0 $ 17
TOTAL FOR INDUSTRY: GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION $ 1,159 $455,556 $456,715
OTHER DIRECT FEDERAL OBLIGATIONS
1,300 0 1,300 Tennessee Valley Authority,
5.375%, Ser G I 5.375% 11/13/2008 $ 1,354 $ 0 $ 1,354
U.S. TREASURY SECURITIES
5,000 0 5,000 US Treasury 6.00% Note 8-15-2004 6.000% 08/15/2004 $ 5,417 $ 0 $ 5,417
PAGE 20 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
2,000 0 2,000 US Treasury Bond,
10.375% 11-15-2012 10.375% 11/15/2012 $ 2,678 $ 0 $ 2,678
4,000 0 4,000 US Treasury Note 4.625% 2-28-2003 4.625% 02/28/2003 $ 4,129 $ 0 $ 4,129
4,000 0 4,000 US Treasury Note 5.625% 2-15-2006 5.625% 02/15/2006 $ 4,348 $ 0 $ 4,348
1,000 0 1,000 US Treasury Note 5.75% 11-30-2002 5.750% 11/30/2002 $ 1,039 $ 0 $ 1,039
3,000 0 3,000 US Treasury Note, 5.00%, 2-15-2011 5.000% 02/15/2011 $ 3,166 $ 0 $ 3,166
3,900 0 3,900 US Treasury, Zero Coupon Strip
11-15-2021 11/15/2021 $ 1,362 $ 0 $ 1,362
TOTAL FOR INDUSTRY: U.S. TREASURY SECURITIES $ 22,139 $ 0 $ 22,139
TOTAL FOR SEGMENT: U.S. GOVERNMENT SECURITIES $ 27,019 $ 455,556 $ 482,575
S-T INVESTMENTS
FINANCE
8,126 0 8,126 Repurchase Agreement 2.57% 11-01-01 2.570% 11/01/2001 $ 8,126 $ 0 $ 8,126
3 0 3 U.S. Bank N.A. Money Market
Variable Rate $3 $ 0 $ 3
TOTAL FOR INDUSTRY: FINANCE $ 8,129 $ 0 $ 8,129
REPURCHASE AGREEMENT
0 86,782 86,782 Joint Repurchase Agreement 2.570% 11/1/01 $ 0 $ 86,782 $ 86,782
TOTAL FOR SEGMENT: S-T INVESTMENTS $ 8,129 $ 86,782 $ 94,911
TOTAL FOR FUND: THE HARTFORD ADVISERS FUND $222,943 $2,231,662 $2,454,605
PAGE 21 OF 22
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD ADVISERS FUND
ACQUIRED FUND : FORTIS ADVANTAGE FUNDS - ASSET ALLOCATION
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 22 OF 22
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
FORTIS WORLDWIDE GLOBAL GROWTH (ACQUIRED)
HARTFORD GLOBAL LEADERS FUND (ACQUIRING)
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/2001 10/31/2001 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- ----------
ASSETS
Investments, at value $105,830 $399,921 0 $505,751
Cash, receivables and other assets 7,285 30,486 0 37,771
Collateral for securities lending transactions 0 9,334 0 9,334
Unrealized appreciation on forward foreign
currency contracts 14 0 0 14
--------- ---------- --------- ----------
TOTAL ASSETS 113,129 439,741 0 552,870
--------- ---------- --------- ----------
LIABILITIES
Unrealized depreciation on forward foreign
currency contracts 0 0 0 0
Payable upon return of securities loaned 0 9,334 0 9,334
Payable for investment securities purchased 1,852 6,894 0 8,746
Redemptions of capital stock 127 1,811 0 1,938
Accounts payable and accrued expenses 180 153 0 333
--------- ---------- --------- ----------
TOTAL LIABILITIES 2,159 18,192 0 20,351
--------- ---------- --------- ----------
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 97,164 573,695 0 670,859
Unrealized appreciation (depreciation) of investments
in securities and translations of assets and liabilities
denominated in foreign currency (120) (775) 0 (895)
Undistributed net investment loss 0 (51) 0 (51)
Accumulated net realized gain (loss) from sale of
investments and currency 13,925 (151,320) 0 (137,394)
--------- ---------- --------- ----------
TOTAL NET ASSETS $110,970 $421,549 0 $532,519
========= ========== ========= ==========
OUTSTANDING SHARES
Class A 4,351,471 19,262,984 2,011,241 (A) 25,625,696
Class B 631,687 5,021,010 1,422,862 (A) 7,075,559
Class C 202,464 8,254,026 84,212 (A) 8,540,702
Class H 823,909 0 (823,909) (A) 0
Class Y 0 607,000 0 (A) 607,000
6,009,531 33,145,020 2,694,406 (A) 41,848,957
NET ASSET VALUE
Class A $18.76 $12.83 $12.83
Class B $17.70 $12.54 $12.54
Class C $17.77 $12.55 $12.55
Class H $17.70 $0.00 $0.00
Class Y $0.00 $13.03 $13.03
(a) Reflects increase (decrease) in shares due to differences in the net
asset values of the funds. Fortis Class H will merge to Hartford Class B.
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001
FORTIS WORLDWIDE GLOBAL GROWTH (ACQUIRED)
HARTFORD GLOBAL LEADERS FUND (ACQUIRING)
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/01 10/31/01 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- --------
NET INVESTMENT INCOME:
Income
Interest Income $407 $1,401 0 $1,808
Dividend Income 1,256 5,862 0 7,118
Fee income 14 115 0 129
--------- ---------- --------- ----------
Total Income 1,677 7,378 0 9,055
--------- ---------- --------- ----------
Expenses:
Investment advisory and management fees 1,475 4,021 (367) (A) 5,129
Transfer agent fees 0 1,143 363 (A) 1,506
Distribution fees 653 2,920 110 (A) 3,683
Registration fees 45 83 (30) (A) 98
Custodian fees, gross 49 192 (49) (A) 192
Custodian fees, expense offset 0 (22) 0 (22)
Accounting services 0 91 30 (A) 121
Directors' fees and expenses 14 2 (14) (A) 2
Other 122 87 (94) (A) 115
--------- ---------- --------- ----------
Total expenses (before reimbursements and waivers) 2,358 8,517 (51) 10,824
Expense reimbursements 0 0 0 0
Class A distribution fees waived 0 (132) (55) (A) (187)
--------- ---------- --------- ----------
Total expenses, net 2,358 8,385 (106) 10,637
--------- ---------- --------- ----------
NET INVESTMENT INCOME (LOSS) (681) (1,007) 106 (1,582)
--------- ---------- --------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from investments & foreign
currency transactions 18,111 (142,160) 0 (124,049)
Net change in unrealized appreciation (depreciation)
from investments and translation of assets & liabilities
denominated in foreign currency (91,616) (700) 0 (92,316)
--------- ---------- --------- ----------
NET LOSS ON INVESTMENTS (73,505) (142,860) 0 (216,365)
--------- ---------- --------- ----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS ($74,186) ($143,867) $106 ($217,947)
========= ========= ========= ==========
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. -- Global Growth
Portfolio (Acquired Fund) by The Hartford Mutual Funds, Inc. -- Hartford Global
Leaders Fund (Acquiring Fund) as if such acquisition had taken place as of the
close of business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Investments in securities traded on a national securities
exchange (domestic or foreign) or on the NASDAQ National Market System are
valued at the last reported sales price. Securities for which over-the-counter
market quotations are readily available are valued on the basis of the last
current bid price. An outside pricing service may be utilized to provide such
valuations. Securities quoted in foreign currencies are translated into U.S.
dollars at the exchange rates at the end of each business day. Options are
valued at the last sales price. If no sale took place on such day, then options
are valued at the mean between the bid and asked prices. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by management under supervision of the Board of
Directors. Short-term investments, with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are valued at
amortized cost.
FOREIGN CURRENCY TRANSACTIONS AND FORWARD CURRENCY CONTRACTS: The accounting
records of the Acquiring Fund are maintained in U.S. dollars. All assets and
liabilities initially expressed in foreign currencies are converted into U.S.
dollars at prevailing exchange rates. Purchases and sales of investment
securities, dividend and interest income and certain expenses are translated at
the rates of exchange prevailing on the respective dates of such transactions.
The Acquiring Fund does not isolate that portion of portfolio security valuation
resulting from fluctuations in foreign currency exchange rates on portfolio
securities from the fluctuations arising from changes in the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss on investments in the accompanying financial statements.
Net realized foreign exchange gains or losses arise from sales of foreign
currencies and the difference between asset and liability amounts initially
stated in foreign currencies and the U.S. dollar value of the amounts actually
received or paid. Net unrealized foreign exchange gains or losses arise from
changes in the value of other assets and liabilities at the end of the reporting
period resulting from changes in the exchange rates.
For the twelve-months ended October 31, 2001 the Funds entered into forward
foreign currency exchange contracts that obligate the Funds to repurchase/
replace or sell currencies at specified future dates. The Funds enter into
forward foreign currency contracts to hedge against adverse fluctuations in
exchange rates between currencies. Forward contracts involve elements of market
risk in excess of the amount reflected in the Statement of Net Assets (Assets
and Liabilities). In addition, risks may arise upon entering into these
contracts from the potential inability of counterparties to meet the terms of
the contract and from unanticipated movement in the value of foreign currencies
relative to the U.S. dollar.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date, except that certain dividends for foreign securities where the
ex-dividend date may have passed are recorded as soon as the Fund is informed of
the dividend in the exercise of reasonable diligence. Interest income and
expenses are recorded on the accrual basis. Realized security gains and losses
are determined using the identified cost method.
LENDING OF PORTFOLIO SECURITIES: At October 31, 2001, securities were on loan to
brokers from the Funds. For collateral, the Funds' custodian received cash,
which is maintained in a separate account and invested by the custodian in
short-term investment vehicles. The risks to the Funds in security lending
transactions are that the borrower may not provide additional collateral when
required or return the securities when due and that the proceeds from the sale
of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by Wellington
Management Company LLP (Wellington). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security (ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FUTURES, OPTIONS ON FUTURES AND OPTIONS TRANSACTIONS: A futures contract is an
agreement between two parties to buy and sell a security at a set price on a
future date. When the Funds enter into such contracts, they are required to
deposit with their custodian an amount of "initial margin" of cash, commercial
paper or U.S. Treasury Bills. Subsequent payments, called maintenance margin, to
and from the broker, are made on a daily basis as the price of the underlying
security fluctuates, making the long and short positions in the futures contract
more or less valuable (i.e. mark-to-market), which results in an unrealized gain
or loss to the Funds. The market value of a traded futures contract is the last
sale price. In the absence of a last sale price, the last offering price is
used. In the absence of either of these prices, fair value is determined
according to procedures established by the funds' Board of Directors. At any
time prior to expiration of the futures contract, the Funds may close the
position by taking an opposite position, which would operate to terminate the
position in the futures contract. A final determination of the maintenance
margin is then made, additional cash is required to be paid by or released to
the Funds and the Funds realize a gain or loss. The use of futures contracts
involve elements of market and counter party risk, which may exceed the amount
recognized in the Statements of Net Assets (Assets and Liabilities). Change in
the value of the futures contracts may decrease the effectiveness of a Fund's
strategies and potentially result in loss.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's Statement of Net Assets (Schedule of Investments) as an investment
and subsequently "marked-to-market" through net unrealized appreciation
(depreciation) of options to reflect the current market value of the option as
of the end of the reporting period. If a purchased option expires on its
stipulated expiration date, the Fund realizes a loss in the amount of the cost
of the option. If the Fund exercises a put option, it realizes a gain or loss
from the sale of the underlying security and
the proceeds from such sale will be decreased by the premium originally paid. If
the Fund exercises a call option, the cost of the security, which the Fund
purchases upon exercise, will be increased by the premium originally paid to buy
the call.
The Funds may write covered options. "Covered" means that so long as a Fund is
obligated as the writer of an option, it will own either the underlying
securities or currency or the option to purchase or sell the same underlying
securities or currency having the expiration date of the covered option and an
exercise price equal to or less than the exercise price of the covered option,
or will establish or maintain with it's custodian for the term of the option a
"segregated account" consisting of cash or other liquid securities having a
value equal to the fluctuating market value of the option securities or
currencies. A Fund receives a premium for writing a call or put option, recorded
as a component of other liabilities on the Statement of Net Assets (Assets and
Liabilities), which increases the Funds' return, recorded as a realized gain, if
the option expires unexercised or is closed out at a net profit. Any loss
realized from the covered option is offset by the gain realized on the sale of
the underlying securities or currency. Covered options, at times before exercise
or close out, are marked-to-market through net unrealized appreciation
(depreciation) of options. There is a risk of loss from a change in value of
such options, which may exceed the related premiums received.
INDEXED SECURITIES: The Acquiring Fund may invest in indexed securities whose
values are linked to changes in interest rates, indices, or other underlying
instruments. The Acquiring Fund uses these securities to increase or decrease
it's exposure to different underlying instruments and to gain exposure to
markets that might be difficult to invest through conventional securities.
Indexed securities may be more volatile than their underlying instruments, but
any loss is limited to the amount of the original investment and there is a
limit to the potential appreciation of the investment.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Funds to pay
annual distributions from net investment income. The distributions are recorded
on the record date and are payable in cash or reinvested in additional shares of
the fund at net asset value without any charge to the shareholder.
Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: Each Fund is permitted to invest up to 15% of its net
assets in illiquid securities. "Illiquid Securities" are those that may not be
sold or disposed of in the ordinary course of business, at approximately the
price used to determine a Fund's net asset value per share. Each Fund may also
purchase certain restricted (unregistered) securities, commonly known as Rule
144A securities, that can be resold to institutions and which may be determined
to be liquid pursuant to policies and guidelines established by the Fund's Board
of Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with Wellington for the provision of day
to day investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate Wellington. The Acquiring Fund's investment
advisory and management fees are computed at an annual rate of .85% of the first
$500 million of average daily net assets, .75% for the next $500 million, and
.70% for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be used to compensate those
who sell shares of the fund and to pay certain other expenses of selling fund
shares. The Class A Rule 12b-1 fee for the Acquiring Fund has been voluntarily
capped at .30% through at least February 28, 2003. The cap may be removed at any
time thereafter. There is no distribution plan for Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2002. For Class A the limit is 1.65%, Classes B and C the limit is 2.35% and for
Class Y the limit is 1.20%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2002 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO and/or The Hartford or its subsidiaries. No
officer of the Funds receives any compensation directly from the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND: FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- -------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
COMMON STOCK
"FOOD, BEVERAGE & TOBACCO"
6 21 27 Nestle S.A. $1,212 $ 4,393 $ 5,605
28 105 133 Pepsico, Inc. $1,374 $ 5,090 $ 6,464
15 56 71 Philip Morris Companies, Inc. $ 702 $ 2,607 $ 3,309
TOTAL FOR INDUSTRY: "FOOD, BEVERAGE & TOBACCO" $3,288 $12,090 $15,378
"METALS, MINERALS & MINING"
14 51 65 Alcoa, Inc. $ 445 $ 1,655 $ 2,100
AEROSPACE & DEFENSE
34 125 159 Raytheon Co. $1,090 $ 4,025 $ 5,115
APPAREL & TEXTILE
15 56 71 Adidas-Salomon AG $ 857 $ 3,156 $ 4,013
PAGE 1 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
BANKS
21 80 101 Banco Popular Espanol S.A. $ 722 $ 2,677 $ 3,399
12 45 57 Bank of America Corp. $ 720 $ 2,643 $ 3,363
16 60 76 Bank One Corp. $ 538 $ 2,001 $ 2,539
15 55 70 Bayerische Hypo- und Vereinsbank AG $ 455 $ 1,682 $ 2,137
23 83 106 BNP Paribas S.A. $ 1,876 $ 6,902 $ 8,778
68 249 317 Citigroup, Inc. $ 3,082 $11,318 $14,400
50 183 233 Credit Suisse Group $ 1,815 $ 6,685 $ 8,500
30 112 142 Deutsche Bank AG $ 1,678 $ 6,215 $ 7,893
78 289 367 Royal Bank of Scotland Group plc $ 1,873 $ 6,910 $ 8,783
TOTAL FOR INDUSTRY: BANKS $12,759 $47,033 $59,792
BUSINESS SERVICES
196 722 918 Capita Group plc $ 1,241 $ 4,582 $ 5,823
627 2,293 2,920 Rentokil Initial plc $ 2,258 $ 8,236 $10,494
TOTAL FOR INDUSTRY: BUSINESS SERVICES $ 3,499 $12,818 $16,317
COMMUNICATIONS
165 606 771 COLT Telecom Group plc $ 281 $ 1,037 $ 1,318
105 386 491 Deutsche Telekom AG $ 1,613 $ 5,950 $ 7,563
78 292 370 Nokia Oyj $ 1,642 $ 6,111 $ 7,753
0 0 0 NTT DoCoMo, Inc. $ 800 $ 2,943 $ 3,743
PAGE 2 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- -------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
60 219 279 SK Telecom Co. Ltd. ADR $ 1,273 $ 4,623 $ 5,896
284 1,051 1,335 Telefonaktiebolaget LM Ericsson AB $ 1,234 $ 4,567 $ 5,801
170 618 788 Telefonica S.A. $ 2,045 $ 7,428 $ 9,473
23 86 109 Verizon Communications, Inc. $ 1,166 $ 4,304 $ 5,470
1,834 6,749 8,583 Vodafone Group plc $ 4,240 $15,608 $19,848
TOTAL FOR INDUSTRY: COMMUNICATIONS $14,294 $52,571 $66,865
COMPUTERS & OFFICE EQUIPMENT
89 329 418 Cisco Systems, Inc. (with rights) $ 1,499 $ 5,558 $ 7,057
58 212 270 Dell Computer Corp. (with rights) $ 1,391 $ 5,074 $ 6,465
92 332 424 Hewlett-Packard Co. $ 1,540 $ 5,594 $ 7,134
11 39 50 International Business Machines Corp. $ 1,156 $ 4,258 $ 5,414
6 21 27 Minnesota Mining and Manufacturing Co. $ 605 $ 2,234 $ 2,839
61 225 286 Solectron Corp. (with rights) $ 748 $ 2,765 $ 3,513
TOTAL FOR INDUSTRY: COMPUTERS & OFFICE EQUIPMENT $ 6,939 $25,483 $32,422
CONSUMER NON-DURABLES
28 101 129 Avon Products, Inc. $ 1,288 $ 4,730 $ 6,018
10 36 46 Cardinal Health, Inc. $ 663 $ 2,446 $ 3,109
17 63 80 Fuji Photo Film Co. Ltd. $ 561 $ 2,079 $ 2,640
63 232 295 Gillette Co. $ 1,962 $ 7,219 $ 9,181
54 198 252 Mattel, Inc. $ 1,020 $ 3,744 $ 4,764
28 103 131 McKesson, Inc. $ 1,025 $ 3,806 $ 4,831
7 26 33 Nintendo Co. Ltd. $ 1,095 $ 3,964 $ 5,059
PAGE 3 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
8 30 38 Tyco International Ltd. (with rights) $ 393 $ 1,464 $ 1,857
TOTAL FOR INDUSTRY: CONSUMER NON-DURABLES $8,007 $29,452 $37,459
DRUGS
31 115 146 Abbott Laboratories (with rights) $1,658 $ 6,087 $ 7,745
25 91 116 American Home Products Corp. (with rights) $1,401 $ 5,069 $ 6,470
44 162 206 AstraZeneca plc $1,979 $ 7,279 $ 9,258
60 222 282 GlaxoSmithKline plc $1,606 $ 5,970 $ 7,576
TOTAL FOR INDUSTRY: DRUGS $6,644 $24,405 $31,049
ELECTRONICS
0 142 142 "Samsung Electronics Co., Ltd., GDR" $ 0 $10,730 $10,730
195 713 908 Arm Holdings plc $ 985 $ 3,592 $ 4,577
30 112 142 General Electric Co. $1,107 $ 4,092 $ 5,199
69 254 323 Intel Corp. $1,692 $ 6,208 $ 7,900
13 49 62 Kyocera Corp. $ 912 $ 3,341 $ 4,253
15 55 70 Murata Manufacturing Co. Ltd. $ 929 $ 3,419 $ 4,348
25 93 118 Siemens AG $1,186 $ 4,421 $ 5,607
46 169 215 Sony Corp. $1,725 $ 6,381 $ 8,106
29 106 135 Texas Instruments, Inc. (with rights) $ 806 $ 2,961 $ 3,767
TOTAL FOR INDUSTRY: ELECTRONICS $9,342 $45,145 $54,487
ENERGY & SERVICES
41 152 193 Exxon Mobil Corp. $1,629 $ 6,008 $ 7,637
PAGE 4 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
13 46 59 Royal Dutch Petroleum Co. $ 641 $ 2,346 $ 2,987
18 67 85 TotalFinaElf S.A. $ 2,543 $ 9,386 $11,929
TOTAL FOR INDUSTRY: ENERGY & SERVICES $ 4,813 $17,740 $22,553
FINANCIAL SERVICES
0 89 89 Fortis Netherlands N.V. $ 0 $ 2,115 $ 2,115
7 26 33 Goldman Sachs Group, Inc. $ 555 $ 2,048 $ 2,603
41 150 191 Merrill Lynch & Co., Inc. $ 1,775 $ 6,539 $ 8,314
23 84 107 Softbank Corp. $ 492 $ 1,792 $ 2,284
TOTAL FOR INDUSTRY: FINANCIAL SERVICES $ 2,822 $12,494 $15,316
FOREST & PAPER PRODUCTS
22 79 101 International Paper Co. $ 770 $ 2,821 $ 3,591
41 152 193 UPM-Kymmene Oyj $ 1,343 $ 4,939 $ 6,282
TOTAL FOR INDUSTRY: FOREST & PAPER PRODUCTS $ 2,113 $ 7,760 $ 9,873
INSURANCE
16 58 74 American International Group, Inc. $ 1,250 $ 4,575 $ 5,825
93 343 436 Lloyds TSB Group plc $ 938 $ 3,450 $ 4,388
TOTAL FOR INDUSTRY: INSURANCE $ 2,188 $ 8,025 $10,213
MEDIA & ENTERTAINMENT
84 312 396 Reed International plc $ 688 $ 2,556 $ 3,244
14 51 65 Thomson Multimedia S.A. $ 330 $ 1,206 $ 1,536
54 197 251 Viacom, Inc. Class B $ 1,961 $ 7,196 $ 9,157
PAGE 5 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
TOTAL FOR INDUSTRY: MEDIA & ENTERTAINMENT $2,979 $10,958 $13,937
MEDICAL INSTRUMENTS & SUPPLIES
47 171 218 Boston Scientific Corp. $1,060 $3,877 $4,937
41 148 189 Johnson & Johnson $2,397 $8,588 $10,985
TOTAL FOR INDUSTRY: MEDICAL INSTRUMENTS & SUPPLIES $3,457 $12,465 $15,922
RETAIL
746 2,699 3,445 Marks & Spencer plc $3,112 $11,302 $14,414
20 73 93 McDonald's Corp. $527 $1,911 $2,438
158 572 730 Staples, Inc. $2,302 $8,340 $10,642
22 80 102 Wal-Mart Stores, Inc. $1,126 $4,122 $5,248
TOTAL FOR INDUSTRY: RETAIL $7,067 $25,675 $32,742
SOFTWARE & SERVICES
68 250 318 AOL Time Warner, Inc. (with rights) $2,129 $7,796 $9,925
37 138 175 Check Point Software Technologies Ltd. $1,086 $4,059 $5,145
47 173 220 Microsoft Corp. $2,727 $10,077 $12,804
84 305 389 Sun Microsystems, Inc. $848 $3,098 $3,946
7 27 34 VeriSign, Inc. $275 $1,030 $1,305
TOTAL FOR INDUSTRY: SOFTWARE & SERVICES $7,065 $26,060 $33,125
TECHNOLOGY
39 0 39 Samsung Electronics Co. Ltd. GDR $2,633 $0 $2,633
PAGE 6 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
TRANSPORTATION
4 16 20 Northrop Grumman Corp. (with rights) $ 450 $ 1,619 $ 2,069
UTILITIES
19 69 88 Vivendi Environnement $ 719 $ 2,635 $ 3,354
TOTAL FOR SEGMENT: COMMON STOCK $103,470 $383,264 $486,734
PREFERRED STOCKS
COMMUNICATIONS
33 122 155 Telecomunicacoes Brasileiras S.A. ADR $ 863 $ 3,171 $ 4,034
TOTAL FOR SEGMENT: PREFERRED STOCKS $ 863 $ 3,171 $ 4,034
S-T INVESTMENTS
FINANCE
1,495 0 1,495 Repurchase Agreement 2.57% 11-01-01 2.570% 11/01/2001 $ 1,495 $ 0 $ 1,495
2 0 2 U.S. Bank N.A. Money Market Variable Rate $ 2 $ 0 $ 2
TOTAL FOR INDUSTRY: FINANCE $ 1,497 $ 0 $ 1,497
PAGE 7 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GLOBAL LEADERS FUND
ACQUIRED FUND : FORTIS WORLDWIDE - GLOBAL GROWTH
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
REPURCHASE AGREEMENT
0 13,486 13,486 Joint Repurchase Agreement 2.570% 11/1/01 $ 0 $ 13,486 $ 13,486
TOTAL FOR SEGMENT: S-T INVESTMENTS $ 1,497 $ 13,486 $ 14,983
TOTAL FOR FUND: THE HARTFORD GLOBAL LEADERS FUND $105,830 $399,921 $505,751
</Table>
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 8 OF 8
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
Fortis Growth & Income (Acquired)
Hartford Growth and Income Fund (Acquiring)
<Table>
<Caption>
Fortis Hartford
Acquired Acquiring
Fund Fund
10/31/2001 10/31/2001 Proforma Proforma
(Historical) (Historical) Adjustments Combined
------------ ------------ ----------- --------
ASSETS
Investments, at value $34,218 $346,881 0 $381,099
Cash, receivables and other assets 653 9,837 0 10,490
Collateral for securities lending transactions 0 9,219 0 9,219
--------- ---------- ------- ----------
TOTAL ASSETS 34,871 365,937 0 400,808
--------- ---------- ------- ----------
LIABILITIES
Payable upon return of securities loaned 0 9,219 0 9,219
Payable for investment securities purchased 897 12,221 0 13,118
Redemptions of capital stock 0 511 0 511
Accounts payable and accrued expenses 54 229 0 283
--------- ---------- ------- ----------
TOTAL LIABILITIES 951 22,180 0 23,131
--------- ---------- ------- ----------
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 33,645 421,718 0 455,363
Unrealized appreciation (depreciation) of investments in
securities and futures contracts (1,904) (41,254) 0 (43,158)
Undistributed net investment income (loss) (35) 0 0 (35)
Accumulated net realized gain (loss) from sale of investments 2,215 (36,707) 0 (34,492)
--------- ---------- ------- ----------
TOTAL NET ASSETS $33,920 $343,757 0 $377,677
========= ========== ======= ==========
OUTSTANDING SHARES
Class A 1,553,904 23,146,033 386,976 (a) 25,086,913
Class B 528,563 4,276,016 649,645 (a) 5,454,224
Class C 150,502 5,974,996 39,151 (a) 6,164,649
Class H 405,177 0 (405,177) (a) 0
Class Y 0 42,000 0 (a) 42,000
2,638,146 33,439,045 670,595 36,747,786
NET ASSET VALUE
Class A $12.94 $10.36 $10.36
Class B $12.74 $10.10 $10.10
Class C $12.74 $10.11 $10.11
Class H $12.75 $0.00 $0.00
Class Y $0.00 $10.52 $10.52
</Table>
(a) Reflects increase (decrease) in shares due to differences in the net asset
values of the funds. Fortis Class H will merge to Hartford Class B.
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001 (Unaudited)
Fortis Growth & Income (Acquired)
Hartford Growth and Income Fund (Acquiring)
<Table>
<Caption>
Fortis Hartford
Acquired Acquiring
Fund Fund
10/31/01 10/31/01 Proforma Proforma
(Historical) (Historical) Adjustments Combined
------------ ------------ ----------- --------
NET INVESTMENT INCOME:
Income
Interest Income $160 $455 0 $615
Dividend Income 493 3,953 0 4,446
Fee income 2 40 0 42
------- -------- --- --------
Total Income 655 4,448 0 5,103
------- -------- --- --------
Expenses:
Investment advisory and management fees 394 2,719 (79) (a) 3,034
Transfer agent fees 0 761 91 (a) 852
Distribution fees 220 1,902 23 (a) 2,145
Registration fees 42 74 (29) (a) 87
Custodian fees, gross 20 12 (20) (a) 12
Custodian fees, expense offset 0 0 0 0
Accounting services 0 66 8 (a) 74
Directors' fees and expenses 2 1 (1) (a) 2
Other 21 62 (14) (a) 69
------- -------- --- --------
Total expenses (before reimbursements and waivers) 699 5,597 (21) 6,275
Expense reimbursements 0 0 0 0
Class A distribution fees waived 0 (115) (12) (a) (127)
------- -------- --- --------
Total expenses, net 699 5,482 (33) 6,148
------- -------- --- --------
NET INVESTMENT INCOME (LOSS) (43) (1,034) 33 (1,171)
------- -------- --- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from investments and option & futures contracts 2,219 (35,963) 0 (33,744)
Net change in unrealized appreciation (depreciation) of
investments in securities & futures contracts (10,853) (43,302) 0 (54,155)
------- -------- --- --------
NET LOSS ON INVESTMENTS (8,634) (79,265) 0 (87,899)
------- -------- --- --------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS ($8,677) ($80,299) $33 ($89,070)
======= ======== === ========
</Table>
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. -- Growth and Income
Fund (Acquired Fund) by The Hartford Mutual Funds, Inc. -- Hartford Growth and
Income Fund (Acquiring Fund) as if such acquisition had taken place as of the
close of business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Investments in securities traded on a national securities
exchange (domestic or foreign) or on the NASDAQ National Market System are
valued at the last reported sales price. Securities for which over-the-counter
market quotations are readily available are valued on the basis of the last
current bid price. An outside pricing service may be utilized to provide such
valuations. Options are valued at the last sales price. If no sale took place on
such day, then options are valued at the mean between the bid and asked prices.
Securities for which market quotations are not readily available are valued at
fair value as determined in good faith by management under supervision of the
Board of Directors. Short-term investments, with maturities of less than 60 days
when acquired, or which subsequently are within 60 days of maturity, are valued
at amortized cost.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date, except that certain dividends for foreign securities where the
ex-dividend date may have passed are recorded as soon as the Fund is informed of
the dividend in the exercise of reasonable diligence. Interest income and
expenses are recorded on the accrual basis. Realized security gains and losses
are determined using the identified cost method.
LENDING OF PORTFOLIO SECURITIES: At October 31, 2001, securities were on loan to
brokers from the Funds. For collateral, the Funds' custodian received cash,
which is maintained in a separate account and invested by the custodian in
short-term investment vehicles. The risks to the Funds in security lending
transactions are that the borrower may not provide additional collateral when
required or return the securities when due and that the proceeds from the sale
of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by Wellington
Management Company LLP (Wellington). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security (ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FUTURES, OPTIONS ON FUTURES AND OPTIONS TRANSACTIONS: A futures contract is an
agreement between two parties to buy and sell a security at a set price on a
future date. When the Funds enter into such contracts, they are required to
deposit with their custodian an amount of "initial margin" of cash, commercial
paper or U.S. Treasury Bills. Subsequent payments, called maintenance
margin, to and from the broker, are made on a daily basis as the price of the
underlying security fluctuates, making the long and short positions in the
futures contract more or less valuable (i.e. mark-to-market), which results in
an unrealized gain or loss to the Funds. The market value of a traded futures
contract is the last sale price. In the absence of a last sale price, the last
offering price is used. In the absence of either of these prices, fair value is
determined according to procedures established by the Funds' Board of Directors.
At any time prior to expiration of the futures contract, the Funds may close the
position by taking an opposite position, which would operate to terminate the
position in the futures contract. A final determination of the maintenance
margin is then made, additional cash is required to be paid by or released to
the Funds and the Funds realize a gain or loss. The use of futures contracts
involve elements of market and counter party risk, which may exceed the amount
recognized in the Statements of Net Assets (Assets and Liabilities). Change in
the value of the futures contracts may decrease the effectiveness of a Fund's
strategies and potentially result in loss.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's Statement of Net Assets (Schedule of Investments) as an investment
and subsequently "marked-to-market" through net unrealized appreciation
(depreciation) of options to reflect the current market value of the option as
of the end of the reporting period. If a purchased option expires on its
stipulated expiration date, the Fund realizes a loss in the amount of the cost
of the option. If the Fund exercises a put option, it realizes a gain or loss
from the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. If the Fund exercises a call option,
the cost of the security, which the Fund purchases upon exercise, will be
increased by the premium originally paid to buy the call.
The Funds may write covered options. "Covered" means that so long as a Fund is
obligated as the writer of an option, it will own either the underlying
securities or currency or the option to purchase or sell the same underlying
securities or currency having the expiration date of the covered option and an
exercise price equal to or less than the exercise price of the covered option,
or will establish or maintain with it's custodian for the term of the option a
"segregated account" consisting of cash or other liquid securities having a
value equal to the fluctuating market value of the option securities or
currencies. A Fund receives a premium for writing a call or put option, recorded
as a component of other liabilities on the Statement of Net Assets (Assets and
Liabilities), which increases the Funds' return, recorded as a realized gain, if
the option expires unexercised or is closed out at a net profit. Any loss
realized from the covered option is offset by the gain realized on the sale of
the underlying securities or currency. Covered options, at times before exercise
or close out, are marked-to-market through net unrealized appreciation
(depreciation) of options. There is a risk of loss from a change in value of
such options, which may exceed the related premiums received.
INDEXED SECURITIES: The Acquiring Fund may invest in indexed securities whose
values are linked to changes in interest rates, indices, or other underlying
instruments. The Acquiring Fund uses these securities to increase or decrease
it's exposure to different underlying instruments and to gain exposure to
markets that might be difficult to invest through conventional securities.
Indexed securities may be more volatile than their underlying instruments, but
any loss is limited to the amount of the original investment and there is a
limit to the potential appreciation of the investment.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Funds to pay
quarterly distributions from net investment income. The distributions are
recorded on the record date and are payable in cash or reinvested in additional
shares of the fund at net asset value without any charge to the shareholder.
Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: Each Fund is permitted to invest up to 15% of its net
assets in illiquid securities. "Illiquid Securities" are those that may not be
sold or disposed of in the ordinary course of business, at approximately the
price used to determine a Fund's net asset value per share. Each Fund may also
purchase certain restricted (unregistered) securities, commonly known as Rule
144A securities, that can be resold to institutions and which may be determined
to be liquid pursuant to policies and guidelines established by the Fund's Board
of Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with Wellington for the provision of day
to day investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate Wellington. The Acquiring Fund's investment
advisory and management fees are computed at an annual rate of .80% of the first
$500 million of average daily net assets, .70% for the next $500 million, and
.65% for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be used to compensate those
who sell shares of the fund and to pay certain other expenses of selling fund
shares. The Class A Rule 12b-1 fee for the Acquiring Fund has been voluntarily
capped at
.30% through at least February 28, 2003. The cap may be removed at any time
thereafter. There is no distribution plan for Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2002. For Class A the limit is 1.45%, Classes B and C the limit is 2.15% and for
Class Y the limit is 1.00%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2002 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO and/or The Hartford or its subsidiaries. No
officer of the Funds receives any compensation directly from the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND : FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON STOCK
"FOOD, BEVERAGE
& TOBACCO"
5 45 50 Pepsi Bottling
Group, Inc. $ 218 $ 2,082 $ 2,300
14 132 146 Pepsico, Inc. $ 662 $ 6,435 $ 7,097
Philip Morris
13 102 115 Companies, Inc. $ 622 $ 4,755 $ 5,377
R.J. Reynolds
5 49 54 Tobacco Holdings, Inc. $ 275 $ 2,768 $ 3,043
TOTAL FOR INDUSTRY:
"FOOD, BEVERAGE
& TOBACCO" $1,777 $16,040 $17,817
"METALS, MINERALS
& MINING"
3 30 33 Alcoa, Inc. $ 110 $ 955 $ 1,065
6 66 72 Engelhard Corp.
(with rights) $ 170 $ 1,738 $ 1,908
Freeport-McMoRan
16 158 174 Copper & Gold, Inc. $ 158 $ 1,581 $ 1,739
12 116 128 Lockheed Martin Corp. $ 585 $ 5,662 $ 6,247
TOTAL FOR INDUSTRY:
"METALS, MINERALS
& MINING" $ 1,023 $ 9,936 $10,959
BANKS
Bank of
6 58 64 America Corp. $ 342 $ 3,439 $ 3,781
</Table>
PAGE 1 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND : FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
29 282 311 Citigroup, Inc. $ 1,304 $12,846 $14,150
9 88 97 Fannie Mae $ 712 $ 7,116 $ 7,828
Pacific Century
23 220 243 Financial Corp. $ 534 $ 5,119 $ 5,653
PNC Financial
3 37 40 Services Group $ 181 $ 2,015 $ 2,196
12 122 134 UnionBanCal Corp. $ 414 $ 4,067 $ 4,481
Washington Mutual,
14 124 138 Inc. (with rights) $ 423 $ 3,741 $ 4,164
TOTAL FOR INDUSTRY:
BANKS $ 3,910 $38,343 $42,253
CHEMICALS Du Pont (E.I.)
10 89 99 de Nemours & Co. $ 380 $ 3,543 $ 3,923
COMMUNICATIONS
20 206 226 AT&T Corp. $ 305 $ 3,142 $ 3,447
7 67 74 Motorola, Inc. $ 116 $ 1,095 $ 1,211
Qwest Communications
11 113 124 International, Inc. $ 146 $ 1,459 $ 1,605
SBC Communications,
6 59 65 Inc. $ 221 $ 2,241 $ 2,462
Sonus Networks,
18 177 195 Inc. $ 76 $ 745 $ 821
Sycamore Networks,
18 241 259 Inc. $ 81 $ 1,061 $ 1,142
5 45 50 Tekelec $ 92 $ 866 $ 958
Verizon Communications,
15 149 164 Inc. $ 742 $ 7,412 $ 8,154
WorldCom, Inc. -
WorldCom Group
30 277 307 (with rights) $ 404 $ 3,726 $ 4,130
TOTAL FOR INDUSTRY:
COMMUNICATIONS $ 2,183 $21,747 $23,930
</Table>
PAGE 2 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND : FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
COMPUTERS &
OFFICE
EQUIPMENT
Cisco Systems,
Inc. (with
30 285 315 rights) $ 499 $ 4,821 $ 5,320
Dell Computer
Corp. (with
9 92 101 rights) $ 216 $ 2,206 $ 2,422
13 134 147 Hewlett-Packard Co. $ 226 $ 2,257 $ 2,483
International Business
4 42 46 Machines Corp. $ 476 $ 4,561 $ 5,037
Lexmark International,
6 58 64 Inc. $ 260 $ 2,609 $ 2,869
6 61 67 SanDisk Corp. $ 70 $ 663 $ 733
Solectron Corp.
14 137 151 (with rights) $ 166 $ 1,680 $ 1,846
TOTAL FOR INDUSTRY:
COMPUTERS &
OFFICE EQUIPMENT $ 1,913 $18,797 $20,710
CONSUMER
NON-DURABLES
10 101 111 McKesson, Inc. $ 385 $ 3,751 $ 4,136
10 96 106 Procter & Gamble Co. $ 701 $ 7,053 $ 7,754
13 127 140 Safeway, Inc. $ 546 $ 5,302 $ 5,848
Tyco International
17 170 187 Ltd. (with rights) $ 845 $ 8,329 $ 9,174
TOTAL FOR INDUSTRY:
CONSUMER NON-DURABLES $ 2,477 $24,435 $26,912
DRUGS
12 126 138 Abbott Laboratories
(with rights) $ 662 $ 6,681 $ 7,343
American Home Products
3 32 35 Corp. (with rights) $ 184 $ 1,803 $ 1,987
Genzyme Corp. -
9 87 96 General Division $ 469 $ 4,699 $ 5,168
7 71 78 Immunex Corp. $ 170 $ 1,699 $ 1,869
6 66 72 Lilly (Eli) & Co. $ 497 $ 5,011 $ 5,508
6 59 65 Merck & Co., Inc. $ 396 $ 3,733 $ 4,129
</Table>
PAGE 3 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND: FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
6 60 66 Pfizer, Inc. $ 253 $ 2,526 $ 2,779
Pharmacia Corp.
22 224 246 (with rights) $ 904 $ 9,095 $ 9,999
Schering-Plough Corp.
17 169 186 (with rights) $ 636 $ 6,298 $ 6,934
TOTAL FOR INDUSTRY:
DRUGS $ 4,171 $41,545 $45,716
ELECTRICAL
EQUIPMENT
Credence Systems
10 89 99 Corp. $ 129 $ 1,204 $ 1,333
Thermo Electron
Corp. (with
7 72 79 rights) $ 148 $ 1,526 $ 1,674
TOTAL FOR INDUSTRY:
ELECTRICAL EQUIPMENT $ 277 $ 2,730 $ 3,007
ELECTRONICS
26 260 286 General Electric Co. $ 965 $ 9,474 $10,439
12 118 130 Intel Corp. $ 291 $ 2,884 $ 3,175
Linear Technology
4 40 44 Corp. $ 163 $ 1,544 $ 1,707
Sanmina Corp. (with
10 106 116 rights) $ 159 $ 1,600 $ 1,759
Texas Instruments,
11 105 116 Inc. (with rights) $ 297 $ 2,945 $ 3,242
TOTAL FOR INDUSTRY:
ELECTRONICS $ 1,875 $18,447 $20,322
ENERGY & SERVICES
4 41 45 ChevronTexaco Corp. $ 367 $ 3,609 $ 3,976
20 201 221 Exxon Mobil Corp. $ 789 $ 7,922 $ 8,711
Helmerich &
6 61 67 Payne, Inc. $ 194 $ 1,862 $ 2,056
Royal Dutch
Petroleum Co.
5 48 53 NY Shares $ 242 $ 2,414 $ 2,656
Santa Fe
6 63 69 International Corp. $ 153 $ 1,536 $ 1,689
</Table>
PAGE 4 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND : FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
6 65 71 Sunoco, Inc. $ 232 $ 2,448 $ 2,680
TOTAL FOR INDUSTRY:
ENERGY & SERVICES $ 1,977 $19,791 $21,768
FINANCIAL SERVICES
Investment Technology
4 45 49 Group, Inc. $ 290 $ 2,892 $ 3,182
Merrill Lynch &
8 83 91 Co., Inc. $ 367 $ 3,645 $ 4,012
TOTAL FOR INDUSTRY:
FINANCIAL SERVICES $ 657 $ 6,537 $ 7,194
FOREST & PAPER
PRODUCTS
Kimberly-Clark
4 36 40 Corp. $ 211 $ 2,009 $ 2,220
3 30 33 Temple-Inland, Inc. $ 150 $ 1,505 $ 1,655
TOTAL FOR INDUSTRY:
FOREST & PAPER PRODUCTS $ 361 $ 3,514 $ 3,875
HEALTH SERVICES
AmerisourceBergen
3 31 34 Corp. $ 203 $ 1,958 $ 2,161
INSURANCE
Ambac Financial
10 94 104 Group, Inc. $ 461 $ 4,502 $ 4,963
American
International
8 74 82 Group, Inc. $ 602 $ 5,818 $ 6,420
St. Paul
Companies, Inc.
10 104 114 (with rights) $ 482 $ 4,792 $ 5,274
TOTAL FOR INDUSTRY:
INSURANCE $ 1,545 $15,112 $16,657
MEDIA &
ENTERTAINMENT
7 69 76 Adelphia Communications
Corp. Class A $ 155 $ 1,518 $ 1,673
</Table>
PAGE 5 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND : FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
Gannett Co., Inc.
4 36 40 (with rights) $ 246 $ 2,256 $ 2,502
Knight-Ridder, Inc.
4 40 44 (with rights) $ 219 $ 2,239 $ 2,458
Liberty Media Corp.
34 333 367 Class A $ 399 $ 3,889 $ 4,288
TOTAL FOR INDUSTRY:
MEDIA & ENTERTAINMENT $ 1,019 $ 9,902 $10,921
MEDICAL INSTRUMENTS
& SUPPLIES
Baxter International,
4 50 54 Inc. (with rights) $ 208 $ 2,409 $ 2,617
Becton, Dickinson
10 101 111 & Co. (with rights) $ 351 $ 3,616 $ 3,967
TOTAL FOR INDUSTRY:
MEDICAL INSTRUMENTS
& SUPPLIES $ 559 $ 6,025 $ 6,584
RETAIL
Bed Bath & Beyond,
12 121 133 Inc. $ 313 $ 3,037 $ 3,350
0 88 88 CVS Corp. $ 0 $ 2,108 $ 2,108
19 183 202 Dollar General Corp. $ 267 $ 2,611 $ 2,878
10 101 111 Home Depot, Inc. $ 398 $ 3,869 $ 4,267
7 73 80 Kroger Co. $ 179 $ 1,781 $ 1,960
Lowe's Companies,
9 83 92 Inc. $ 300 $ 2,820 $ 3,120
12 124 136 McDonald's Corp. $ 321 $ 3,230 $ 3,551
28 263 291 Staples, Inc. $ 402 $ 3,839 $ 4,241
Wal-Mart Stores,
8 79 87 Inc. $ 421 $ 4,081 $ 4,502
TOTAL FOR INDUSTRY:
RETAIL $ 2,601 $27,376 $29,977
SOFTWARE & SERVICES
AOL Time Warner, Inc.
21 207 228 (with rights) $ 659 $ 6,470 $ 7,129
</Table>
PAGE 6 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF
INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND: FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
8 82 90 First Data Corp. $ 561 $ 5,554 $ 6,115
6 57 63 Intuit, Inc.
(with rights) $ 225 $ 2,305 $ 2,530
22 213 235 Microsoft Corp. $ 1,268 $12,403 $13,671
9 88 97 Oracle Corp.
Rational Software $ 122 $ 1,197 $ 1,319
1 6 7 Corp. $ 13 $ 75 $ 88
6 57 63 VeriSign, Inc. $ 217 $ 2,210 $ 2,427
VERITAS Software
4 39 43 Corp. $ 116 $ 1,098 $ 1,214
TOTAL FOR INDUSTRY:
SOFTWARE & SERVICES $ 3,181 $31,312 $34,493
TRANSPORTATION
5 38 43 Southwest Airlines Co. $ 75 $ 606 $ 681
6 63 69 USFreightways Corp. $ 187 $ 1,951 $ 2,138
TOTAL FOR INDUSTRY:
TRANSPORTATION $ 262 $ 2,557 $ 2,819
6 0 6 UTILITIES
Constellation
Energy Group,
Inc. $ 139 $ 0 $ 139
Dominion
4 35 39 Resources,
Inc. $ 214 $ 2,158 $ 2,372
7 69 76 Duke Energy Corp. $ 261 $ 2,643 $ 2,904
10 98 108 Exelon Corp. $ 416 $ 4,115 $ 4,531
0 55 55 Pinnacle West
Capital Corp. $ 0 $ 2,322 $ 2,322
9 93 102 Waste Management, Inc. $ 228 $ 2,271 $ 2,499
TOTAL FOR INDUSTRY:
UTILITIES $ 1,258 $13,509 $14,767
</Table>
PAGE 7 OF 8
<Table>
<Caption>
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD GROWTH AND INCOME FUND ACQUIRED FUND: FORTIS EQUITY FNDS - GROWTH & INCOME
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
----------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL FOR SEGMENT:
COMMON STOCK $33,609 $333,156 $366,765
S-T INVESTMENTS
FINANCE
444 0 444 Repurchase Agreement
2.57% 11-01-01 2.570% 11/01/2001 $ 444 $ 0 $ 444
0 0 0 U.S. Bank N.A.
Money Market
Variable Rate $ 0 $ 0 $ 0
165 0 165 U.S. Treasury
3.46%, 12-20-2001 3.460% 12/20/2001 $ 165 $ 0 $ 165
TOTAL FOR INDUSTRY:
FINANCE $ 609 $ 0 $ 609
REPURCHASE
AGREEMENT
0 13,725 13,725 Joint Repurchase
Agreement 2.570% 11/1/01 $ 0 $ 13,725 $ 13,725
TOTAL FOR SEGMENT:
S-T INVESTMENTS $ 609 $13,725 $ 14,334
TOTAL FOR FUND:
THE HARTFORD
GROWTH AND
INCOME FUND $34,218 $346,881 $381,099
</Table>
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 8 OF 8
<Table>
<Caption>
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
FORTIS HIGH YIELD (ACQUIRED) FORTIS HARTFORD
HARTFORD HIGH YIELD FUND (ACQUIRING) ACQUIRED ACQUIRING
FUND FUND
10/31/2001 10/31/2001 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
-------------- -------------- -------------- --------------
ASSETS
Investments, at value $ 99,714 $91,382 0 $191,096
Cash, receivables and other assets 3,010 3,686 0 6,696
Collateral for securities lending transactions 0 2,249 0 2,249
-------------- -------------- -------------- --------------
TOTAL ASSETS 102,724 97,317 0 200,041
-------------- -------------- -------------- --------------
LIABILITIES
Payable upon return of securities loaned 0 2,249 0 2,249
Income distribution payable 313 0 0 313
Payable for investment securities purchased 136 133 0 269
Redemptions of capital stock 0 385 0 385
Accounts payable and accrued expenses 111 47 0 158
-------------- -------------- -------------- --------------
TOTAL LIABILITIES 560 2,814 0 3,374
- - - -
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 184,647 105,320 0 289,967
Unrealized appreciation (depreciation) of investments in
securities and translation of assets and liabilities
denominated in foreign currency (22,576) (7,197) 0 (29,773)
Undistributed net investment income (loss) 0 139 0 139
Accumulated net realized loss from sale of investments (59,907) (3,759) 0 (63,666)
-------------- -------------- -------------- --------------
TOTAL NET ASSETS $102,164 $94,503 0 $196,667
============== ============== ============== ==============
OUTSTANDING SHARES
Class A 12,754,174 5,418,019 (5,267,700) (a) 12,904,493
Class B 2,147,217 2,006,998 2,122,651 (a) 6,276,866
Class C 583,456 3,273,993 (240,165) (a) 3,617,284
Class H 5,105,508 0 (5,105,508) (a) 0
Class Y 0 498,001 0 (a) 498,001
20,590,355 11,197,011 (8,490,722) (a) 23,296,644
NET ASSET VALUE
Class A $4.96 $8.45 $8.45
Class B $4.97 $8.43 $8.43
Class C $4.96 $8.43 $8.43
Class H $4.96 $0.00 $0.00
Class Y $0.00 $8.48 $8.48
</Table>
(a) Reflects increase (decrease) in shares due to differences in the net asset
values of the funds. Fortis Class H will merge to Hartford Class B.
<Table>
<Caption>
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001 (Unaudited)
FORTIS HIGH YIELD (ACQUIRED) FORTIS HARTFORD
HARTFORD HIGH YIELD FUND (ACQUIRING) ACQUIRED ACQUIRING
FUND FUND
10/31/01 10/31/01 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
-------------- -------------- ------------- -------------
NET INVESTMENT INCOME:
Income
Interest Income $13,039 $7,084 0 $20,123
Dividend Income 24 58 0 82
Fee income 0 7 0 7
-------------- -------------- ------------- -------------
Total Income 13,063 7,149 0 20,212
-------------- -------------- ------------- -------------
Expenses:
Investment advisory and management fees 866 518 9 (a) 1,393
Transfer agent fees 0 154 271 (a) 425
Distribution fees 698 436 0 (a) 1,134
Registration fees 40 21 (28) (a) 33
Custodian fees, gross 7 7 (7) (a) 7
Custodian fees, expense offset 0 (6) 0 (6)
Accounting services 0 14 23 (a) 37
Directors' fees and expenses 8 0 (8) (a) 0
Other 54 14 (34) (a) 34
-------------- -------------- ------------- -------------
Total expenses (before reimbursements and waivers) 1,674 1,158 226 3,058
Expense reimbursements 0 0 0 0
Class A distribution fees waived 0 (17) (36) (a) (53)
-------------- -------------- ------------- -------------
Total expenses, net 1,674 1,141 190 3,005
-------------- -------------- ------------- -------------
NET INVESTMENT INCOME (LOSS) 11,389 6,008 (190) 17,207
-------------- -------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss from investments & foreign currency transactions (10,730) (1,916) 0 (12,646)
Net change in unrealized appreciation (depreciation) from
investments and translation of assets & liabilities denominated
in foreign currency (5,593) (4,914) 0 (10,507)
-------------- -------------- ------------- -------------
NET LOSS ON INVESTMENTS (16,323) (6,830) 0 (23,153)
-------------- -------------- ------------- -------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ($4,934) ($822) ($190) ($5,946)
============== ============== ============= =============
</Table>
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. - High Yield Portfolio
(Acquired Fund) by The Hartford Mutual Funds, Inc. - Hartford High Yield Fund
(Acquiring Fund) as if such acquisition had taken place as of the close of
business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Investments in securities traded on a national securities
exchange (domestic or foreign) or on the NASDAQ National Market System are
valued at the last reported sales price. Securities for which over-the-counter
market quotations are readily available are valued on the basis of the last
current bid price. An outside pricing service may be utilized to provide such
valuations. For fixed income securities, the pricing service may employ a matrix
system to determine valuations using methods which include consideration of
yields or prices of bonds of comparable quality, type of issue, coupon, maturity
and rating indications as to value from dealers, and general market conditions.
Options are valued at the last sales price. If no sale took place on such day,
then options are valued at the mean between the bid and asked prices. Securities
for which market quotations are not readily available are valued at fair value
as determined in good faith by management under supervision of the Board of
Directors. Short-term investments, with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are valued at
amortized cost.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date, except that certain dividends for foreign securities where the
ex-dividend date may have passed are recorded as soon as the Fund is informed of
the dividend in the exercise of reasonable diligence. Interest income and
expenses are recorded on the accrual basis. Realized security gains and losses
are determined using the identified cost method.
LENDING OF PORTFOLIO SECURITIES: At October 31, 2001, securities were on loan to
brokers from the Funds. For collateral, the Funds' custodian received cash,
which is maintained in a separate account and invested by the custodian in
short-term investment vehicles. The risks to the Funds in security lending
transactions are that the borrower may not provide additional collateral when
required or return the securities when due and that the proceeds from the sale
of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by The Hartford
Investment Management Company (HIMCO). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security(ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FUTURES, OPTIONS ON FUTURES AND OPTIONS TRANSACTIONS: A futures contract is an
agreement between two parties to buy and sell a security at a set price on a
future date. When the Funds enter into such contracts, they are required to
deposit with their custodian an amount of "initial margin" of cash, commercial
paper or U.S. Treasury Bills. Subsequent payments, called maintenance margin, to
and from the broker, are made on a daily basis as the price of the underlying
security fluctuates, making the long and short positions in the futures contract
more or less valuable (i.e. mark-to-market), which results in an unrealized gain
or loss to the Funds. The market value of a traded futures contract is the last
sale price. In the absence of a last sale price, the last offering price is
used. In the absence of either of these prices, fair value is determined
according to procedures established by the Funds' Board of Directors. At any
time prior to expiration of the futures contract, the Funds may close the
position by taking an opposite position, which would operate to terminate the
position in the futures contract. A final determination of the maintenance
margin is then made, additional cash is required to be paid by or released to
the Funds and the Funds realize a gain or loss. The use of futures contracts
involve elements of market and counter party risk, which may exceed the amount
recognized in the Statements of Net Assets (Assets and Liabilities). Change in
the value of the futures contracts may decrease the effectiveness of a Fund's
strategies and potentially result in loss.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's Statement of Net Assets (Schedule of Investments) as an investment
and subsequently "marked-to-market" through net unrealized appreciation
(depreciation) of options to reflect the current market value of the option as
of the end of the reporting period. If a purchased option expires on its
stipulated expiration date, the Fund realizes a loss in the amount of the cost
of the option. If the Fund exercises a put option, it realizes a gain or loss
from the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. If the Fund exercises a call option,
the cost of the security, which the Fund purchases upon exercise, will be
increased by the premium originally paid to buy the call.
The Funds may write covered options. "Covered" means that so long as a Fund is
obligated as the writer of an option, it will own either the underlying
securities or currency or the option to purchase or sell the same underlying
securities or currency having the expiration date of the covered option and an
exercise price equal to or less than the exercise price of the covered option,
or will establish or maintain with it's custodian for the term of the option a
"segregated account" consisting of cash or other liquid securities having a
value equal to the fluctuating market value of the option securities or
currencies. A Fund receives a premium for writing a call or put option, recorded
as a component of other liabilities on the Statement of Net Assets (Assets and
Liabilities), which increases the Funds' return, recorded as a realized gain, if
the option expires unexercised or is closed out at a net profit. Any loss
realized from the covered option is offset by the gain realized on the sale of
the underlying securities or currency. Covered options, at times before exercise
or close out, are marked-to-market through net unrealized appreciation
(depreciation) of options. There is a risk of loss from a change in value of
such options, which may exceed the related premiums received.
INDEXED SECURITIES: The Acquiring Fund may invest in indexed securities whose
values are linked to changes in interest rates, indices, or other underlying
instruments. The Acquiring Fund uses these securities to increase or decrease
it's exposure to different underlying instruments and to gain exposure to
markets that might be difficult to invest through conventional securities.
Indexed
securities may be more volatile than their underlying instruments, but any loss
is limited to the amount of the original investment and there is a limit to the
potential appreciation of the investment.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Fund to pay
monthly distributions from net investment income. The distributions are recorded
on the record date and are payable in cash or reinvested in additional shares of
the fund at net asset value without any charge to the shareholder.
Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: Each Fund is permitted to invest up to 15% of its net
assets in illiquid securities. "Illiquid Securities" are those that may not be
sold or disposed of in the ordinary course of business, at approximately the
price used to determine a Fund's net asset value per share. Each Fund may also
purchase certain restricted (unregistered) securities, commonly known as Rule
144A securities, that can be resold to institutions and which may be determined
to be liquid pursuant to policies and guidelines established by the Fund's Board
of Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with HIMCO for the provision of day to day
investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate HIMCO. The Acquiring Fund's investment advisory
and management fees are computed at an annual rate of .75% of the first $500
million of average daily net assets, .65% for the next $500 million, and .60%
for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be
used to compensate those who sell shares of the fund and to pay certain other
expenses of selling fund shares. The Class A Rule 12b-1 fee for the Acquiring
Fund has been voluntarily capped at .30% through at least February 28, 2003. The
cap may be removed at any time thereafter. There is no distribution plan for
Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2002. For Class A the limit is 1.40%, Classes B and C the limit is 2.10% and for
Class Y the limit is .95%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2002 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO and/or The Hartford or its subsidiaries. No
officer of the Funds receives any compensation directly from the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
FOREIGN CURRENCIES
11 0 11 EURO $10 $0 $10
TOTAL FOR SEGMENT: $10 $0 $10
COMMON STOCK
CONSUMER CYCLICAL
1 0 1 Hosiery Corp. of America, Inc.
Class A $0 $0 $0
SERVICES
9 0 9 Marvel Enterprises, Inc. Class C
(Warrants) $0 $0 $0
4 0 4 Splitrock Service (Warrants) $23 $0 $23
TOTAL FOR INDUSTRY: SERVICES $23 $0 $23
TECHNOLOGY
1 0 1 @Track Communications, Inc.
(Warrants) $1 $0 $1
6 0 6 Adelphia Business Solutions,
Inc. (with rights) $4 $0 $4
13 0 13 Powertel, Inc. (Warrants) $338 $0 $338
11 0 11 Telus Corp. (Warrants) $77 $0 $77
TOTAL FOR INDUSTRY: TECHNOLOGY $420 $0 $420
</Table>
PAGE 1 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
TOTAL FOR SEGMENT: COMMON STOCK $443 $0 $443
PREFERRED STOCKS
"METALS, MINERALS & MINING"
0 21 21 Rio Algom Ltd. $0 $505 $505
COMMUNICATIONS
0 5 5 "NEXTLINK Communications, Inc." $0 $10 $10
TOTAL FOR SEGMENT: PREFERRED STOCKS $0 $515 $515
CORPORATE BONDS
"FOOD, BEVERAGE & TOBACCO"
0 260 260 "Hercules, Inc. (Ba1)" 6.600% 8/1/27 $0 $215 $215
75 70 145 Smithfield Foods, Inc., 8.00%,
10-15-2009 8.000% 10/15/2009 $78 $73 $151
TOTAL FOR INDUSTRY: "FOOD, BEVERAGE & TOBACCO" $78 $288 $366
"METALS, MINERALS & MINING"
0 100 100 "Lukens, Inc. (Ca)" 7.625% 8/1/04 $0 $9 $9
1,065 1,280 2,345 AK Steel Corp., 7.875%,
2-15-2009 7.875% 02/15/2009 $996 $1,197 $2,193
180 100 280 Newmont Mining Corp., 8.625%,
5-15-2011 8.625% 05/15/2011 $187 $104 $291
585 460 1,045 Phelps Dodge Corp., 8.75%,
6-1-2011 8.750% 06/01/2011 $532 $418 $950
</Table>
PAGE 2 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
255 660 915 Phelps Dodge Corp., 9.50%,
6-1-2031 9.500% 06/01/2031 $228 $589 $817
375 215 590 Santa Fe Pacific Gold Corp. 8.375% 07/01/2005 $394 $226 $620
810 605 1,415 U.S. Steel L.L.C., 10.75%,
8-1-2008 10.750% 08/01/2008 $729 $545 $1,274
TOTAL FOR INDUSTRY: "METALS, MINERALS & MINING" $3,066 $3,088 $6,154
AEROSPACE & DEFENSE
0 450 450 "Condor Systems, Inc. (Ca)" 11.875% 5/1/09 $0 $153 $153
BANKS
0 300 300 "Golden State Holdings, Inc.
(Ba1)" 7.125% 8/1/05 $0 $306 $306
0 520 520 "Sovereign Bankcorp, Inc. (Ba3)" 8.625% 3/15/04 $0 $550 $550
TOTAL FOR INDUSTRY: BANKS $0 $856 $856
BASIC MATERIALS
1,500 0 1,500 Hercules, Inc., 11.125%,
11-15-2007 11.125% 11/15/2007 $1,395 $0 $1,395
1,750 0 1,750 Lyondell Chemical Co., 9.875%,
Ser B 5-1-2007 9.875% 05/01/2007 $1,680 $0 $1,680
TOTAL FOR INDUSTRY: BASIC MATERIALS $3,075 $0 $3,075
BUSINESS SERVICES
0 75 75 "Interpool, Inc. (Ba3)" 7.350% 8/1/07 $0 $69 $69
1,000 800 1,800 Building One Services Corp.,
10.50%, 5-1-2009 10.500% 05/01/2009 $735 $588 $1,323
530 350 880 United Rentals, Inc., 10.75%,
4-15-2008 10.750% 04/15/2008 $556 $368 $924
TOTAL FOR INDUSTRY: BUSINESS SERVICES $1,291 $1,025 $2,316
</Table>
PAGE 3 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
CAPITAL GOODS
1,250 0 1,250 BRL Universal Equipment, 8.875%, 8.875% 02/15/2008 $1,288 $0 $1,288
1,625 0 1,625 Sequa Corp., 8.875%,
Ser B 4-1-2008 8.875% 04/01/2008 $1,438 $0 $1,438
TOTAL FOR INDUSTRY: CAPITAL GOODS $2,726 $0 $2,726
CHEMICALS
0 1,200 1,200 "Millennium America, Inc. (Ba1)" 7.625% 11/15/26 $0 $860 $860
0 500 500 ARCO Chemical Co. (Ba3) 9.800% 2/1/20 $0 $437 $437
1,650 980 2,630 Equistar Chemical L.P., 7.55%,
2-15-2026 7.550% 02/15/2026 $1,176 $637 $1,813
0 170 170 Georgia Gulf Corp. (Ba2) 7.625% 11/15/05 $0 $174 $174
550 215 765 Georgia Gulf Corp., 10.375%,
11-1-2007 10.375% 11/01/2007 $562 $220 $782
0 300 300 Huntsman Corp. (Ca) 9.500% 7/1/07 $0 $18 $18
0 150 150 Huntsman ICI Chemicals LLC (B2) 10.125% 7/1/09 $0 $122 $122
135 125 260 IMC Global, Inc., 11.25%,
6-1-2011 11.250% 06/01/2011 $138 $128 $266
0 480 480 Lyondell Chemical Co. (Ba3) 9.625% 5/1/07 $0 $461 $461
TOTAL FOR INDUSTRY: CHEMICALS $1,876 $3,057 $4,933
COMMUNICATIONS
0 825 825 "Level 3 Communications, Inc.
(Caa1)" 11.250% 3/15/10 $0 $334 $334
0 100 100 "McLeodUSA, Inc. (B3)" 9.250% 7/15/07 $0 $24 $24
0 300 300 "McLeodUSA, Inc. (B3)" 9.500% 11/1/08 $0 $72 $72
0 200 200 "McLeodUSA, Inc. (B3)" 11.500% 5/1/09 $0 $52 $52
0 100 100 "McLeodUSA, Inc. (CCC+ S&P)" 8.125% 2/15/09 $0 $23 $23
0 300 300 "Metromedia Fiber Network, Inc.
(Caa3)" 10.000% 12/15/09 $0 $57 $57
</Table>
PAGE 4 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 100 100 "Telecorp PCS, Inc. (B3)" 10.625% 7/15/10 $0 $116 $116
0 400 400 "Tritel PCS, Inc. (B3)" 10.375% 1/15/11 $0 $459 $459
0 750 750 "XO Communications, Inc. (Caa1)" 10.750% 11/15/08 $0 $143 $143
0 1,065 1,065 "XO Communications, Inc. (Caa1)" 12.500% 4/15/06 $0 $213 $213
760 680 1,440 Allegiance Telecom, Inc.,
19.08%, Ser B 02/15/2008 $308 $275 $583
0 200 200 Centennial Communications Corp.
(B3) 10.750% 12/15/08 $0 $173 $173
0 325 325 Crown Castle International Corp.
(B3) 10.750% 8/1/11 $0 $307 $307
1,640 860 2,500 Crown Castle International
Corp. 9.375% 08/01/2011 $1,427 $748 $2,175
250 1,025 1,275 Echostar DBS Corp., 9.375%,
2-1-2009 9.375% 02/01/2009 $255 $1,046 $1,301
0 300 300 Focal Communications Corp.
(Caa3) 12.250% 2/15/08 $0 $81 $81
595 295 890 Focal Communications Corp.,
11.875%, Ser B 11.875% 01/15/2010 $214 $106 $320
540 810 1,350 Level 3 Communications, Inc. 11.000% 03/15/2008 $259 $389 $648
4,445 3,095 7,540 Level 3 Communications, Inc. 9.125% 05/01/2008 $2,000 $1,393 $3,393
0 150 150 Loral Space & Communications
Ltd. (B3) 9.500% 1/15/06 $0 $75 $75
2,368 1,755 4,123 Lucent Technologies, Inc.,
6.45%, 3-15-2029 6.450% 03/15/2029 $1,492 $1,106 $2,598
2,330 1,305 3,635 McLeodUSA, Inc., 11.375%,
1-1-2009 11.375% 01/01/2009 $629 $352 $981
320 450 770 Metromedia Fiber Network, Inc. 10.000% 12/15/2009 $70 $99 $169
2,135 1,330 3,465 Metromedia Fiber Network, Inc. 10.000% 11/15/2008 $470 $293 $763
870 1,180 2,050 Motorola, Inc., 5.22%, 10-1-2097 5.220% 10/01/2097 $539 $732 $1,271
3,670 2,620 6,290 Nextel Communications, Inc. 9.375% 11/15/2009 $2,578 $1,841 $4,419
0 870 870 NTL Communications Corp. (B3) 12.375% 2/1/08 $0 $494 $494
0 475 475 NTL Communications Corp. (B3) 9.875% 11/15/09 $0 $222 $222
1,300 450 1,750 PanAmSat Corp., 6.875%,
1-15-2028 6.875% 01/15/2028 $857 $297 $1,154
</Table>
PAGE 5 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
562 170 732 RCN Corp., 34.99%,
Ser B 2-15-2008 (Zero) 02/15/2008 $135 $41 $176
1,795 1,520 3,315 Spectrasite Holdings, Inc.,
16.37%, 4-15-2009 04/15/2009 $521 $441 $962
275 645 920 Time Warner Telecom LLC,
9.75%, 7-15-2008 9.750% 07/15/2008 $209 $490 $699
840 1,350 2,190 Williams Communications Group,
Inc. 10.875% 10/01/2009 $353 $581 $934
2,030 2,610 4,640 Williams Communications Group,
Inc. 11.700% 08/01/2008 $853 $1,122 $1,975
TOTAL FOR INDUSTRY: COMMUNICATIONS $13,169 $14,197 $27,366
CONSTRUCTION
0 100 100 "MDC Holdings, Inc. (Ba2)" 8.375% 2/1/08 $0 $101 $101
0 600 600 Centex Corp. (Baa2) 7.875% 2/1/11 $0 $613 $613
0 50 50 Del Webb Corp. (Ba1) 9.375% 5/1/09 $0 $51 $51
265 155 420 Integrated Electric Services,
Inc. 9.375% 02/01/2009 $223 $130 $353
0 220 220 Kaufman and Broad Home Corp.
(Ba2) 7.750% 10/15/04 $0 $220 $220
0 100 100 Toll Corp. (Ba2) 8.750% 11/15/06 $0 $101 $101
0 125 125 Toll Corp. (BB+ S&P) 7.750% 9/15/07 $0 $122 $122
TOTAL FOR INDUSTRY: CONSTRUCTION $223 $1,338 $1,561
CONSUMER CYCLICAL
1,000 0 1,000 D.R. Horton, Inc., 9.375%,
3-15-2011 9.375% 03/15/2011 $980 $0 $980
CONSUMER NON-DURABLES
0 675 675 "Fleming Cos., Inc. (Ba3)" 10.125% 4/1/08 $0 $705 $705
275 200 475 Airgas, Inc., 9.125%, 10-1-2011 9.125% 10/01/2011 $289 $210 $499
</Table>
PAGE 6 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
340 283 623 Arkmel Finance, Inc., 9.50%,
8-15-2009 9.500% 08/15/2009 $355 $296 $651
520 385 905 Plastipak Holdings, Inc.,
10.75%, 9-1-2011 10.750% 09/01/2011 $544 $403 $947
0 400 400 Xerox Corp. (Ba1) 5.250% 12/15/03 $0 $316 $316
TOTAL FOR INDUSTRY: CONSUMER NON-DURABLES $1,188 $1,930 $3,118
CONSUMER SERVICES
0 300 300 Service Corp. International (B1) 7.875% 2/1/13 $0 $269 $269
2,375 1,245 3,620 Service Corp. International,
6.50%, 3-15-2008 6.500% 03/15/2008 $2,108 $1,105 $3,213
250 420 670 Service Corp. International,
6.875%, 10-1-2007 6.875% 10/01/2007 $226 $380 $606
TOTAL FOR INDUSTRY: CONSUMER SERVICES $2,334 $1,754 $4,088
DRUGS
0 540 540 "Watson Pharmaceuticals, Inc.
(Ba1)" 7.125% 5/15/08 $0 $558 $558
275 240 515 Alaris Medical Systems, Inc.,
11.625%, 12-1-2006 11.625% 12/01/2006 $291 $254 $545
TOTAL FOR INDUSTRY: DRUGS $291 $812 $1,103
ENERGY
300 0 300 Key Energy Services, Inc.,
8.375%, 3-1-2008 8.375% 03/01/2008 $303 $0 $303
625 0 625 Nuevo Energy Co., 9.375%,
Ser B 10-1-2010 9.375% 10/01/2010 $600 $0 $600
1,000 0 1,000 Pioneer Natural Resources Co.,
9.625%, 4-1-2010 9.625% 04/01/2010 $1,127 $0 $1,127
800 0 800 Swift Energy Co., 10.25%,
8-1-2009 10.250% 08/01/2009 $812 $0 $812
TOTAL FOR INDUSTRY: ENERGY $2,842 $0 $2,842
ENERGY & SERVICES
0 75 75 "Clark Refining & Marketing,
Inc. (Ba3)" 8.625% 8/15/08 $0 $65 $65
</Table>
PAGE 7 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 900 900 "Newpark Resources, Inc. (B2)" 8.625% 12/15/07 $0 $801 $801
0 450 450 "Plains Resources, Inc. (B2)" 10.250% 3/15/06 $0 $457 $457
0 400 400 "Varco International, Inc.
(Baa2)" 7.500% 2/15/08 $0 $400 $400
0 125 125 "Vintage Petroleum, Inc. (Ba3)" 9.750% 6/30/09 $0 $134 $134
0 150 150 Belco Oil & Gas Corp. (Ba3) 8.875% 9/15/07 $0 $153 $153
0 50 50 Cross Timbers Oil Co. (Ba3) 8.750% 11/1/09 $0 $52 $52
0 403 403 Nuevo Energy Co. (B1) 9.500% 6/1/08 $0 $391 $391
0 161 161 Peabody Energy Corp. (B1) 9.625% 5/15/08 $0 $171 $171
0 325 325 Pioneer Natural Resources Co.
(Ba1) 6.500% 1/15/08 $0 $313 $313
0 500 500 Pioneer Natural Resources Co.
(Ba1) 7.200% 1/15/28 $0 $438 $438
0 650 650 Pogo Producing Co. (B1) 10.375% 2/15/09 $0 $692 $692
1,400 320 1,720 Pogo Producing Co., 8.25%,
Ser B 4-15-2011 8.250% 04/15/2011 $1,418 $324 $1,742
0 100 100 R&B Falcon Corp. (Baa3) 7.375% 4/15/18 $0 $98 $98
0 150 150 R&B Falcon Corp. (Baa3) 6.500% 4/15/03 $0 $155 $155
300 200 500 Snyder Oil Corp., 8.75%,
6-15-2007 8.750% 06/15/2007 $315 $210 $525
0 575 575 Tesoro Petroleum Corp. (B1) 9.000% 7/1/08 $0 $561 $561
TOTAL FOR INDUSTRY: ENERGY & SERVICES $1,733 $5,415 $7,148
FINANCE
1,000 0 1,000 Sovereign Bancorp, Inc., 10.50%,
11-15-2006 10.500% 11/15/2006 $1,101 $0 $1,101
1,085 0 1,085 Xerox Credit Corp., 6.10%,
12-16-2003 6.100% 12/16/2003 $902 $0 $902
TOTAL FOR INDUSTRY: FINANCE $2,003 $0 $2,003
FINANCIAL SERVICES
</Table>
PAGE 8 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 200 200 "HMH Properties, Inc. (Ba2)" 8.450% 12/1/08 $0 $176 $176
0 465 465 Xerox Credit Corp. (Ba1) 6.100% 12/16/03 $0 $403 $403
TOTAL FOR INDUSTRY: FINANCIAL SERVICES $0 $579 $579
FOREIGN CORPORATIONS
0 100 100 "Placer Dome, Inc. (Baa2)" 7.125% 6/15/07 $0 $103 $103
0 645 645 "Quebecor Media, Inc. (B2)" 11.125% 7/15/11 $0 $674 $674
0 945 945 "Rogers Cablesystems, Inc.
(Baa3)" 10.000% 12/1/07 $0 $1,004 $1,004
0 200 200 "Rogers Cantel, Inc. (Baa3)" 9.750% 6/1/16 $0 $197 $197
0 250 250 "Tembec Industries, Inc. (Ba1)" 8.625% 6/30/09 $0 $263 $263
435 300 735 Acetex Corp., 10.875%, 8-1-2009 10.875% 08/01/2009 $402 $278 $680
750 500 1,250 Asia Global Crossing Ltd.,
13.375%, 10-15-2010 13.375% 10/15/2010 $180 $120 $300
300 220 520 AT&T Canada, Inc., 7.65%,
9-15-2006 7.650% 09/15/2006 $196 $143 $339
600 400 1,000 British Sky Broadcasting
Group plc, 8.20%, 7-15-2009 8.200% 07/15/2009 $618 $412 $1,030
560 375 935 British Telecommunications plc,
8.875%, 12-15-2030 8.875% 12/15/2030 $669 $448 $1,117
750 525 1,275 Callahan Nordrhein-Westfalen,
14.00%, 7-15-2010 14.000% 07/15/2010 $495 $347 $842
255 230 485 Domtar, Inc., 7.875%, 10-15-2011 7.875% 10/15/2011 $261 $235 $496
1,350 350 1,700 eKabel Hessen GMBH, 14.50%,
9-1-2010 14.500% 09/01/2010 $729 $189 $918
0 400 400 Flowserve Finance B.V. (B3) 12.250% 8/15/10 $0 $378 $378
0 575 575 Global Crossing Holdings Ltd.
(B2) 9.625% 5/15/08 $0 $98 $98
170 160 330 Global Crossing Holdings Ltd.,
8.70%, 8-1-2007 8.700% 08/01/2007 $26 $25 $51
4,142 2,333 6,475 Global Crossing Holdings Ltd.,
9.50%, 11-15-2009 9.500% 11/15/2009 $683 $385 $1,068
0 600 600 Inco Ltd. (Baa3) 9.600% 6/15/22 $0 $626 $626
0 415 415 Kappa Beheer B.V. (B2) 10.625% 7/15/09 $0 $400 $400
</Table>
PAGE 9 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
45 30 75 Koninklijke (Royal) KPN N.V. 8.000% 10/01/2010 $38 $25 $63
1,420 1,195 2,615 Koninklijke KPN N.V., 8.375%,
10-1-2030 8.375% 10/01/2030 $1,118 $932 $2,050
0 520 520 KPNQwest N.V. (Ba1) 7.125% 6/1/09 $0 $281 $281
1,980 1,375 3,355 KPNQwest N.V., 8.125%, 6-1-2009 8.125% 06/01/2009 $1,247 $866 $2,113
3,318 2,850 6,168 Marconi Corp. plc, 8.375%,
9-15-2030 8.375% 09/15/2030 $1,192 $1,024 $2,216
0 1,050 1,050 Messer Griesheim GmbH (B2) 10.375% 6/1/11 $0 $927 $927
350 315 665 Nortel Networks Corp., 6.875%,
9-1-2023 6.875% 09/01/2023 $222 $200 $422
0 600 600 Ono Finance PLC (Caa1) 13.000% 5/1/09 $0 $414 $414
550 250 800 Rogers Cantel, Inc., 9.375%,
6-1-2008 9.375% 06/01/2008 $549 $249 $798
0 500 500 Teekay Shipping Corp. (Ba1) 8.320% 2/1/08 $0 $512 $512
0 260 260 Telewest Communications PLC (B2) 9.625% 10/1/06 $0 $195 $195
0 1,405 1,405 Telewest Communications PLC (B2) 11.000% 10/1/07 $0 $1,089 $1,089
635 315 950 Tembec Industries, Inc., 8.50%,
2-1-2011 8.500% 02/01/2011 $668 $332 $1,000
0 100 100 Trizec Finance Ltd. (Baa3) 10.875% 10/15/05 $0 $102 $102
0 330 330 United Pan-Europe
Communications N.V. 10.875% 11/1/07 $0 $42 $42
TOTAL FOR INDUSTRY: FOREIGN CORPORATIONS $9,293 $13,515 $22,808
FOREIGN GOVERNMENTS
1,150 1,000 2,150 Netherlands Government, 5.75%,
9-18-2002 5.750% 09/15/2002 $1,057 $919 $1,976
0 250 250 Republic of Brazil (B1) 12.750% 1/15/20 $0 $194 $194
0 100 100 Republic of Colombia (Ba2) 8.375% 2/15/27 $0 $71 $71
0 8 8 Republic of Ecuador (Caa2) 12.000% 11/15/12 $0 $5 $5
0 145 145 Republic of Ecuador (Caa2) 5.000% 8/15/30 $0 $58 $58
0 400 400 Russian Federation (B2) 11.000% 7/24/18 $0 $358 $358
</Table>
PAGE 10 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
TOTAL FOR INDUSTRY: FOREIGN GOVERNMENTS $1,057 $1,605 $2,662
FOREST & PAPER PRODUCTS
0 350 350 Boise Cascade Corp. (Baa3) 7.350% 2/1/16 $0 $324 $324
0 520 520 Georgia-Pacific Corp. (Baa3) 9.875% 11/1/21 $0 $534 $534
620 385 1,005 Louisiana-Pacific Corp., 8.50%,
8-15-2005 8.500% 08/15/2005 $583 $362 $945
0 507 507 Pactiv Corp. (Baa3) 8.125% 6/15/17 $0 $554 $554
690 670 1,360 Potlatch Corp., 10.00%,
7-15-2011 10.000% 07/15/2011 $711 $690 $1,401
630 400 1,030 Potlatch Corp., 9.425%,
12-1-2009 9.425% 12/01/2009 $706 $440 $1,146
0 125 125 Stone Container Corp. (B2) 12.580% 8/1/16 $0 $134 $134
1,500 600 2,100 Stone Container Corp., 9.75%,
2-1-2011 9.750% 02/01/2011 $1,579 $632 $2,211
TOTAL FOR INDUSTRY: FOREST & PAPER PRODUCTS $3,579 $3,670 $7,249
HEALTH CARE
750 0 750 AdvancePCS, 8.50%, 4-1-2008 8.500% 04/01/2008 $780 $0 $780
2,250 0 2,250 HealthSouth Corp., 10.75%,
10-1-2008 10.750% 10/01/2008 $2,514 $0 $2,514
1,500 0 1,500 Tenet Healthcare Corp., 8.625%,
1-15-2007 8.625% 01/15/2007 $1,581 $0 $1,581
200 0 200 Triad Hospitals, Inc., 8.75%,
5-1-2009 8.750% 05/01/2009 $215 $0 $215
TOTAL FOR INDUSTRY: HEALTH CARE $5,090 $0 $5,090
HEALTH SERVICES
0 1,200 1,200 "Manor Care, Inc. (Ba1)" 7.500% 6/15/06 $0 $1,238 $1,238
0 300 300 "Triad Hospitals, Inc. (B1)" 8.750% 5/1/09 $0 $320 $320
0 250 250 Columbia/HCA Healthcare Corp.
(Ba1) 9.000% 2/15/14 $0 $292 $292
</Table>
PAGE 11 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND: FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- --------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 350 350 Columbia/HCA Healthcare Corp.
(Ba1) 7.500% 11/15/95 $0 $305 $305
200 625 825 HCA, Inc., 6.91%, 6-15-2005 6.910% 06/15/2005 $209 $653 $862
1,760 200 1,960 HCA, Inc., 7.125%, 6-1-2006 7.125% 06/01/2006 $1,844 $210 $2,054
0 340 340 HEALTH SOUTH Corp. (Ba1) 7.000% 6/15/08 $0 $339 $339
0 360 360 HEALTH SOUTH Corp. (Ba1) 6.875% 6/15/05 $0 $362 $362
0 290 290 HEALTH SOUTH Corp. (Ba2) 3.250% 4/1/03 $0 $275 $275
1,605 1,075 2,680 IASIS Healthcare Corp., 13.00%,
10-15-2009 13.000% 10/15/2009 $1,717 $1,150 $2,867
250 160 410 Magellan Health Services, Inc. 9.375% 11/15/2007 $262 $168 $430
650 450 1,100 Select Medical Corp., 9.50%,
6-15-2009 9.500% 06/15/2009 $658 $456 $1,114
0 100 100 Tenet Healthcare Corp. (Baa3) 8.625% 12/1/03 $0 $111 $111
0 200 200 Tenet Healthcare Corp. (Baa3) 7.625% 6/1/08 $0 $237 $237
1,000 400 1,400 Triad Hospitals Holdings, Inc.,
11.00%, Ser B 11.000% 05/15/2009 $1,120 $448 $1,568
150 110 260 Vanguard Health Systems, Inc. 9.750% 08/01/2011 $158 $116 $274
TOTAL FOR INDUSTRY: HEALTH SERVICES $5,968 $6,680 $12,648
HOTELS & GAMING
0 395 395 "MGM Mirage, Inc. (Baa3)" 8.500% 9/15/10 $0 $398 $398
0 200 200 "MGM Mirage, Inc. (Baa3)" 6.875% 2/6/08 $0 $183 $183
0 25 25 "Starwood Hotels & Resorts,
Inc. (Ba1)" 6.750% 11/15/05 $0 $24 $24
0 400 400 Park Place Entertainment Corp.
(Ba1) 7.875% 12/15/05 $0 $390 $390
350 100 450 Park Place Entertainment Corp. 9.375% 02/15/2007 $356 $102 $458
TOTAL FOR INDUSTRY: HOTELS & GAMING $356 $1,097 $1,453
INSURANCE
</Table>
PAGE 12 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 1,000 1,000 "Aetna, Inc. (Baa2)" 7.875% 3/1/11 $0 $1,017 $1,017
MACHINERY
0 100 100 "American Standard Cos., Inc.
(Ba2)" 7.375% 4/15/05 $0 $102 $102
205 120 325 Briggs & Stratton Corp., 8.875%,
3-15-2011 8.875% 03/15/2011 $212 $124 $336
0 955 955 Grove Holdings LLC (C) 5/1/09 $0 $0 $0
600 255 855 Terex Corp., 10.375%, 4-1-2011 10.375% 04/01/2011 $618 $263 $881
TOTAL FOR INDUSTRY: MACHINERY $830 $489 $1,319
MEDIA & ENTERTAINMENT
0 725 725 "CSC Holdings, Inc. (Ba1)" 7.625% 4/1/11 $0 $733 $733
0 150 150 "Fox/Liberty Networks,
LLC (Ba1)" 8.875% 8/15/07 $0 $157 $157
0 825 825 "Hollinger International
Publishing, Inc. (Ba3)" 9.250% 2/1/06 $0 $771 $771
0 125 125 "Lenfest Communications, Inc.
(Baa3)" 10.500% 6/15/06 $0 $148 $148
0 175 175 "PRIMEDIA, Inc. (Ba3)" 7.625% 4/1/08 $0 $138 $138
0 250 250 "PRIMEDIA, Inc. (Ba3)" 10.250% 6/1/04 $0 $215 $215
0 175 175 "World Color Press, Inc. (Baa2)" 7.750% 2/15/09 $0 $176 $176
0 1,225 1,225 Adelphia Communications Corp.
(B2) 10.250% 6/15/11 $0 $1,139 $1,139
500 700 1,200 Adelphia Communications Corp. 10.250% 11/01/2006 $480 $672 $1,152
550 400 950 American Greetings Corp.,
11.75%, 7-15-2008 11.750% 07/15/2008 $530 $386 $916
300 220 520 American Greetings, Inc.,
6.10%, 8-1-2028 6.100% 08/01/2028 $255 $187 $442
600 430 1,030 AT&T Corp. - Liberty Media
Corp. 8.250% 02/01/2030 $560 $401 $961
0 350 350 Charter Communications Holdings
LLC (B2) 11.125% 1/15/11 $0 $370 $370
</Table>
PAGE 13 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
925 830 1,755 Charter Communications Holdings 10.000% 05/15/2011 $934 $838 $1,772
1,315 635 1,950 Charter Communications Holdings 8.625% 04/01/2009 $1,256 $606 $1,862
1,290 540 1,830 Fox Family Worldwide, Inc. 11/01/2007 $1,290 $540 $1,830
600 200 800 Primedia, Inc., 8.50%,
Ser B 2-1-2006 8.500% 02/01/2006 $499 $166 $665
TOTAL FOR INDUSTRY: MEDIA & ENTERTAINMENT $5,804 $7,643 $13,447
MEDICAL INSTRUMENTS & SUPPLIES
0 260 260 "Apogent Technologies, Inc.
(Baa3)" 8.000% 4/1/11 $0 $281 $281
0 160 160 "Omnicare, Inc. (Ba2)" 8.125% 3/15/11 $0 $170 $170
450 325 775 Owens & Minor, Inc., 8.50%,
7-15-2011 8.500% 07/15/2011 $475 $343 $818
TOTAL FOR INDUSTRY: MEDICAL INSTRUMENTS & SUPPLIES $475 $794 $1,269
REAL ESTATE
275 365 640 Stewart Enterprises, Inc.,
10.75%, 7-1-2008 10.750% 07/01/2008 $300 $398 $698
RETAIL
160 120 280 Autonation, Inc., 9.00%,
8-1-2008 9.000% 08/01/2008 $158 $118 $276
SERVICES
750 0 750 Adelphia Communications Corp. 10.875% 10/01/2010 $720 $0 $720
10,117 0 10,117 Australis Media Ltd., 15.75%,
Disc Note 05/15/2003 $1 $0 $1
1,450 0 1,450 Insight Communications Co.,
Inc. 02/15/2011 $805 $0 $805
1,000 0 1,000 Penn National Gaming, Inc.,
11.125%, Series B 11.125% 03/01/2008 $1,042 $0 $1,042
</Table>
PAGE 14 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
900 0 900 Quebecor Media, Inc., 11.125%,
7-15-2011 11.125% 07/15/2011 $940 $0 $940
165 0 165 Stewart Enterprises, Inc.,
10.75%, 7-1-2008 10.750% 07/01/2008 $179 $0 $179
TOTAL FOR INDUSTRY: SERVICES $3,687 $0 $3,687
TECHNOLOGY
500 0 500 CSC Holdings, Inc., 7.625%,
4-1-2011 7.625% 04/01/2011 $506 $0 $506
1,000 0 1,000 Echostar Broadband Corp.,
10.375%, 10-1-20 10.375% 10/01/2007 $1,045 $0 $1,045
1,000 0 1,000 International Cabletel, Inc.,
11.50%, Ser B 11.500% 02/01/2006 $600 $0 $600
250 0 250 Level 3 Communications, Inc. 03/15/2010 $51 $0 $51
1,200 0 1,200 Nextlink Communications, Inc. 12/01/2009 $204 $0 $204
900 0 900 Nextlink Communications, Inc. 12/01/2009 $72 $0 $72
2,400 0 2,400 NTL Communications Corp.,
13.91%, Ser B 10/01/2008 $912 $0 $912
1,250 0 1,250 PSINet, Inc., 11.00%,
8-1-2009 (a) 08/01/2009 $88 $0 $88
1,675 0 1,675 Telewest Communications plc 11.000% 10/01/2007 $1,306 $0 $1,306
1,500 0 1,500 United International Holdings,
Inc. 02/15/2008 $240 $0 $240
300 0 300 United Pan-Europe
Communications N.V., 10.875% 08/01/2009 $45 $0 $45
1 0 1 Voicestream Wireless Corp. 10.375% 11/15/2009 $2 $0 $2
1,750 0 1,750 Williams Communications
Group, Inc. 11.875% 08/01/2010 $735 $0 $735
TOTAL FOR INDUSTRY: TECHNOLOGY $5,806 $0 $5,806
TRANSPORTATION
0 100 100 "Newport News Shipbuilding,
Inc. (Ba1)" 8.625% 12/1/06 $0 $105 $105
0 200 200 "Newport News Shipbuilding, Inc.
(Ba3)" 9.250% 12/1/06 $0 $209 $209
0 500 500 "United Air Lines, Inc. (B2)" 10.670% 5/1/04 $0 $400 $400
</Table>
PAGE 15 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -----------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
0 100 100 "United Air Lines, Inc. (B2)" 9.125% 1/15/12 $0 $71 $71
0 1,150 1,150 Sequa Corp. (Ba2) 9.000% 8/1/09 $0 $1,041 $1,041
1,760 770 2,530 United Air Lines, Inc., 9.75%,
8-15-2021 9.750% 08/15/2021 $1,197 $539 $1,736
TOTAL FOR INDUSTRY: TRANSPORTATION $1,197 $2,365 $3,562
UTILITIES
0 570 570 "Allied Waste North American,
Inc. (B2)" 10.000% 8/1/09 $0 $577 $577
0 300 300 "Browning-Ferris Industries, Inc.
(Ba3)" 6.375% 1/15/08 $0 $270 $270
0 350 350 "Cogentrix Energy, Inc. (Baa3)" 8.750% 10/15/08 $0 $376 $376
0 175 175 "Waste Management, Inc. (Ba1)" 6.875% 5/15/09 $0 $182 $182
0 510 510 "Waste Management, Inc. (Ba1)" 7.375% 8/1/10 $0 $545 $545
0 800 800 "Western Resources, Inc. (Ba1)" 7.650% 4/15/23 $0 $614 $614
0 350 350 AES Corp. (The) (Ba1) 9.375% 9/15/10 $0 $324 $324
0 75 75 AES Corp. (The) (Ba2) 10.250% 7/15/06 $0 $70 $70
2,000 575 2,575 AES Corp., 9.50%, 6-1-2009 9.500% 06/01/2009 $1,885 $542 $2,427
1,800 750 2,550 Allied Waste North America,
7.875%, Ser B 1-1-2009 7.875% 01/01/2009 $1,782 $743 $2,525
1,500 0 1,500 Azurix Corp., 10.75%,
Ser B 2-15-2010 10.750% 02/15/2010 $1,320 $0 $1,320
635 400 1,035 Browning-Ferris Industries,
Inc., 7.40%, 9-15-2035 7.400% 09/15/2035 $525 $331 $856
120 410 530 Calpine Corp., 8.50%, 2-15-2011 8.500% 02/15/2011 $121 $413 $534
500 0 500 Calpine Corp., 8.625%, 8-15-2010 8.625% 08/15/2010 $503 $0 $503
0 80 80 CMS Energy Corp. (Ba3) 8.500% 4/15/11 $0 $82 $82
0 245 245 CMS Energy Corp. (Ba3) 6.750% 1/15/04 $0 $243 $243
0 130 130 CMS Energy Corp. (Ba3) 9.875% 10/15/07 $0 $140 $140
550 150 700 CMS Energy Corp., 7.50%,
1-15-2009 7.500% 01/15/2009 $537 $146 $683
</Table>
PAGE 16 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- ------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
515 380 895 Commonwealth Edison Co., 8.625%,
2-1-2022 8.625% 02/01/2022 $544 $402 $946
0 125 125 El Paso Electric Co. (Ba3) 9.400% 5/1/11 $0 $143 $143
430 425 855 General Chemical Industries,
10.625%, 5-1-2009 10.625% 05/01/2009 $245 $289 $534
960 0 960 Kansas Gas & Electric Co.,
7.60%, 12-15-2003 7.600% 12/15/2003 $989 $0 $989
1,865 1,455 3,320 Mission Energy Holding Co.,
13.50%, 7-15-2008 13.500% 07/15/2008 $2,079 $1,622 $3,701
0 170 170 Pacific Gas & Electric Co. (A2) 7.050% 3/1/24 $0 $162 $162
0 900 900 Pacific Gas & Electric Co. (A2) 6.750% 10/1/23 $0 $855 $855
1,520 0 1,520 Pacific Gas & Electric Co.,
7.25%, Ser 93D 8-1-2006 7.250% 08/01/2026 $1,444 $0 $1,444
1,100 700 1,800 Sierra Pacific Power Co.,
8.00%, Ser A 6-1-2008 8.000% 06/01/2008 $1,191 $758 $1,949
TOTAL FOR INDUSTRY: UTILITIES $13,165 $9,829 $22,994
TOTAL FOR SEGMENT: CORPORATE BONDS $93,640 $83,712 $177,352
U.S. GOVERNMENT SECURITIES
U.S. TREASURY NOTES
0 1,250 1,250 4.625% due 05/16/06 $0 $1,299 $1,299
TOTAL FOR SEGMENT: U.S. GOVERNMENT SECURITIES $0 $1,299 $1,299
S-T INVESTMENTS
FINANCE
5,619 0 5,619 Repurchase Agreement 2.567%
11-01-01 2.567% 11/01/2001 $5,619 $0 $5,619
2 0 2 U.S. Bank N.A. Money Market
Variable Rate $2 $0 $2
</Table>
PAGE 17 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND : THE HARTFORD HIGH YIELD FUND
ACQUIRED FUND : FORTIS ADVANTAGE FNDS - HIGH YIELD
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- ------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------------------------------- -------- ---------- ----------- ----------- -----------
TOTAL FOR INDUSTRY: FINANCE $5,621 $0 $5,621
REPURCHASE AGREEMENT
0 5,856 5,856 Joint Repurchase Agreement 2.567% 11/1/01 $0 $5,856 $5,856
TOTAL FOR SEGMENT: S-T INVESTMENTS $5,621 $5,856 $11,477
TOTAL FOR FUND: THE HARTFORD HIGH YIELD FUND $99,714 $91,382 $191,096
</Table>
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 18 OF 18
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
FORTIS WORLDWIDE INTERNATIONAL EQUITY (ACQUIRED)
HARTFORD INTERNATIONAL OPPORTUNITIES FUND (ACQUIRING)
<Table>
<Caption>
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/2001 10/31/2001 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- --------
ASSETS
Investments, at value $21,615 $122,511 0 $144,126
Cash, receivables and other assets 551 12,477 0 13,028
Collateral for securities lending transactions 0 2,252 0 2,252
Unrealized appreciation on forward foreign currency contracts 0 0 0 0
--------- -------- --------- ----------
TOTAL ASSETS 22,166 137,240 0 159,406
--------- -------- --------- ----------
LIABILITIES
Payable upon return of securities loaned 0 2,252 0 2,252
Payable for investment securities purchased 443 6,071 0 6,514
Redemptions of capital stock 154 2,170 0 2,324
Accounts payable and accrued expenses 46 8 0 54
--------- -------- --------- ----------
TOTAL LIABILITIES 643 10,501 0 11,144
--------- -------- --------- ----------
NET ASSETS
Net proceeds of capital stock, par value$.01 per share 30,126 175,580 0 205,706
Unrealized appreciation (depreciation) of investments
in securities and translation of assets and liabilities
denominated in foreign currency (2,157) (16,154) 0 (18,311)
Undistributed net investment income (loss) 0 1 0 1
Accumulated net realized loss from sale of investments and
currency (6,446) (32,688) 0 (39,134)
--------- -------- --------- ----------
TOTAL NET ASSETS $21,523 $126,739 0 $148,262
========= ========== ========= ==========
OUTSTANDING SHARES
Class A 1,105,649 7,754,975 471,649 (a) 9,332,273
Class B 212,933 2,080,000 423,806 (a) 2,716,739
Class C 80,378 2,060,011 36,389 (a) 2,176,778
Class H 227,986 0 227,986 (a) 0
Class Y 0 1,800,010 0 (a) 1,800,010
1,626,946 13,694,996 1,159,830 16,025,800
NET ASSET VALUE
Class A $13.31 $9.33 $9.33
Class B $13.06 $9.04 $9.04
Class C $13.06 $8.99 $8.99
Class H $13.05 $0.00 $0.00
Class Y $0.00 $9.49 $9.49
</Table>
(a) Reflects increase (decrease) in shares due to differences in the net asset
values of the funds. Fortis Class H will merge to Hartford Class B.
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001
FORTIS WORLDWIDE INTERNATIONAL EQUITY (ACQUIRED)
HARTFORD INTERNATIONAL OPPORTUNITIES FUND (ACQUIRING)
<Table>
<Caption>
FORTIS HARTFORD
ACQUIRED ACQUIRING
FUND FUND
10/31/01 10/31/01 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
------------ ------------ ----------- --------
NET INVESTMENT INCOME:
Income
Interest Income $141 $620 0 $761
Dividend Income 349 2,398 0 2,747
Fee income 0 49 0 49
-------- -------- --- --------
Total Income 490 3,067 0 3,557
-------- -------- --- --------
Expenses:
Investment advisory and management fees 267 1,289 (40) (A) 1,516
Transfer agent fees 0 344 68 (A) 412
Distribution fees 130 763 18 (A) 911
Registration fees 43 22 (30) (A) 35
Custodian fees, gross 26 168 (26) (A) 168
Custodian fees, expense offset 0 (1) 0 (1)
Accounting services 0 29 5 (A) 34
Directors' fees and expenses 3 0 (3) (A) 0
Amortization of organization costs 5 0 0 (A) 5
Other 37 31 (36) 32
-------- -------- --- --------
Total expenses (before reimbursements and waivers) 511 2,645 (44) 3,112
Expense reimbursements 0 0 0 0
Class A distribution fees waived 0 (43) (9) (A) (52)
-------- -------- --- --------
Total expenses, net 511 2,602 (53) 3,060
-------- -------- --- --------
NET INVESTMENT INCOME (LOSS) (21) 465 53 497
-------- -------- --- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized gain from
investments & foreign currency
transactions (5,431) (31,663) 0 (37,094)
Net change in unrealized appreciation (depreciation)
from investments and translation of assets & liabilities
denominated in foreign currency (4,973) (8,748) 0 (13,721)
-------- -------- --- --------
NET LOSS ON INVESTMENTS (10,404) (40,411) 0 (50,815)
-------- -------- --- --------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS ($10,425) ($39,946) $53 ($50,318)
======== ======== === ========
</Table>
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. - International Equity
Portfolio (Acquired Fund) by The Hartford Mutual Funds, Inc. - Hartford
International Opportunities Fund (Acquiring Fund) as if such acquisition had
taken place as of the close of business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Investments in securities traded on a national securities
exchange (domestic or foreign) or on the NASDAQ National Market System are
valued at the last reported sales price. Securities for which over-the-counter
market quotations are readily available are valued on the basis of the last
current bid price. An outside pricing service may be utilized to provide such
valuations. Securities quoted in foreign currencies are translated into U.S.
dollars at the exchange rates at the end of each business day. Options are
valued at the last sales price. If no sale took place on such day, then options
are valued at the mean between the bid and asked prices. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by management under supervision of the Board of
Directors. Short-term investments, with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are valued at
amortized cost.
FOREIGN CURRENCY TRANSACTIONS AND FORWARD CURRENCY CONTRACTS: The accounting
records of the Acquiring Fund are maintained in U.S. dollars. All assets and
liabilities initially expressed in foreign currencies are converted into U.S.
dollars at prevailing exchange rates. Purchases and sales of investment
securities, dividend and interest income and certain expenses are translated at
the rates of exchange prevailing on the respective dates of such transactions.
The Acquiring Fund does not isolate that portion of portfolio security valuation
resulting from fluctuations in foreign currency exchange rates on portfolio
securities from the fluctuations arising from changes in the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss on investments in the accompanying financial statements.
Net realized foreign exchange gains or losses arise from sales of foreign
currencies and the difference between asset and liability amounts initially
stated in foreign currencies and the U.S. dollar value of the amounts actually
received or paid. Net unrealized foreign exchange gains or losses arise from
changes in the value of other assets and liabilities at the end of the reporting
period resulting from changes in the exchange rates.
For the twelve-months ended October 31, 2001 the Funds entered into forward
foreign currency exchange contracts that obligate the Funds to
repurchase/replace or sell currencies at specified future dates. The Funds enter
into forward foreign currency contracts to hedge against adverse fluctuations in
exchange rates between currencies. Forward contracts involve elements of market
risk in excess of the amount reflected in the Statement of Net Assets (Assets
and Liabilities). In addition, risks may arise upon entering into these
contracts from the potential inability of counterparties to meet the terms of
the contract and from unanticipated movement in the value of foreign currencies
relative to the U.S. dollar.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date and dividend income is recorded on the
ex-dividend date, except that certain dividends for foreign securities where the
ex-dividend date may have passed are recorded as soon as the Fund is informed of
the dividend in the exercise of reasonable diligence. Interest income and
expenses are recorded on the accrual basis. Realized security gains and losses
are determined using the identified cost method.
LENDING OF PORTFOLIO SECURITIES: At October 31, 2001, securities were on loan to
brokers from the Funds. For collateral, the Funds' custodian received cash,
which is maintained in a separate account and invested by the custodian in
short-term investment vehicles. The risks to the Funds in security lending
transactions are that the borrower may not provide additional collateral when
required or return the securities when due and that the proceeds from the sale
of investments made with cash collateral received will be less than amounts
required to be returned to the borrowers.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by Wellington
Management Company LLP (Wellington). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security (ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FUTURES, OPTIONS ON FUTURES AND OPTIONS TRANSACTIONS: A futures contract is an
agreement between two parties to buy and sell a security at a set price on a
future date. When the Funds enter into such contracts, they are required to
deposit with their custodian an amount of "initial margin" of cash, commercial
paper or U.S. Treasury Bills. Subsequent payments, called maintenance margin, to
and from the broker, are made on a daily basis as the price of the underlying
security fluctuates, making the long and short positions in the futures contract
more or less valuable (i.e. mark-to-market), which results in an unrealized gain
or loss to the Funds. The market value of a traded futures contract is the last
sale price. In the absence of a last sale price, the last offering price is
used. In the absence of either of these prices, fair value is determined
according to procedures established by the Funds' Board of Directors. At any
time prior to expiration of the futures contract, the Funds may close the
position by taking an opposite position, which would operate to terminate the
position in the futures contract. A final determination of the maintenance
margin is then made, additional cash is required to be paid by or released to
the Funds and the Funds realize a gain or loss. The use of futures contracts
involve elements of market and counter party risk, which may exceed the amount
recognized in the Statements of Net Assets (Assets and Liabilities). Change in
the value of the futures contracts may decrease the effectiveness of a Fund's
strategies and potentially result in loss.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's Statement of Net Assets (Schedule of Investments) as an investment
and subsequently "marked-to-market" through net unrealized appreciation
(depreciation) of options to reflect the current market value of the option as
of the end of the reporting period. If a purchased option expires on its
stipulated expiration date, the Fund realizes a loss in the amount of the cost
of the option. If the Fund exercises a put option, it realizes a gain or loss
from the sale of the underlying security and
the proceeds from such sale will be decreased by the premium originally paid. If
the Fund exercises a call option, the cost of the security, which the Fund
purchases upon exercise, will be increased by the premium originally paid to buy
the call.
The Funds may write covered options. "Covered" means that so long as a Fund is
obligated as the writer of an option, it will own either the underlying
securities or currency or the option to purchase or sell the same underlying
securities or currency having the expiration date of the covered option and an
exercise price equal to or less than the exercise price of the covered option,
or will establish or maintain with it's custodian for the term of the option a
"segregated account" consisting of cash or other liquid securities having a
value equal to the fluctuating market value of the option securities or
currencies. A Fund receives a premium for writing a call or put option, recorded
as a component of other liabilities on the Statement of Net Assets (Assets and
Liabilities), which increases the Funds' return, recorded as a realized gain, if
the option expires unexercised or is closed out at a net profit. Any loss
realized from the covered option is offset by the gain realized on the sale of
the underlying securities or currency. Covered options, at times before exercise
or close out, are marked-to-market through net unrealized appreciation
(depreciation) of options. There is a risk of loss from a change in value of
such options, which may exceed the related premiums received.
INDEXED SECURITIES: The Acquiring Fund may invest in indexed securities whose
values are linked to changes in interest rates, indices, or other underlying
instruments. The Acquiring Fund uses these securities to increase or decrease
it's exposure to different underlying instruments and to gain exposure to
markets that might be difficult to invest through conventional securities.
Indexed securities may be more volatile than their underlying instruments, but
any loss is limited to the amount of the original investment and there is a
limit to the potential appreciation of the investment.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Funds to pay
annual distributions from net investment income. The distributions are recorded
on the record date and are payable in cash or reinvested in additional shares of
the fund at net asset value without any charge to the shareholder.
Net investment income and net realized gains may differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may, therefore, differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the fund.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: Each Fund is permitted to invest up to 15% of its net
assets in illiquid securities. "Illiquid Securities" are those that may not be
sold or disposed of in the ordinary course of business, at approximately the
price used to determine a Fund's net asset value per share. Each Fund may also
purchase certain restricted (unregistered) securities, commonly known as Rule
144A securities, that can be resold to institutions and which may be determined
to be liquid pursuant to policies and guidelines established by the Fund's Board
of Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with Wellington for the provision of day
to day investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate Wellington. The Acquiring Fund's investment
advisory and management fees are computed at an annual rate of .85% of the first
$500 million of average daily net assets, .75% for the next $500 million, and
.70% for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be used to compensate those
who sell shares of the fund and to pay certain other expenses of selling fund
shares. The Class A Rule 12b-1 fee for the Acquiring Fund has been voluntarily
capped at .30% through at least February 28, 2003. The cap may be removed at any
time thereafter. There is no distribution plan for Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2002. For Class A the limit is 1.65%, Classes B and C the limit is 2.35% and for
Class Y the limit is 1.20%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2002 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO and/or The Hartford or its subsidiaries. No
officer of the Funds receives any compensation directly from the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD INTERNATIONAL OPPORT. FUND
ACQUIRED FUND : FORTIS WORLDWIDE - INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
COMMON STOCK
"FOOD, BEVERAGE & TOBACCO"
16 100 116 Compass Group plc $ 120 $ 722 $ 842
4 22 26 Heineken N.V. $ 143 $ 806 $ 949
0 0 0 Japan Tobacco, Inc. $ 137 $ 784 $ 921
1 8 9 Nestle S.A. $ 280 $ 1,619 $ 1,899
28 152 180 Sapporo Breweries Ltd. $ 84 $ 457 $ 541
TOTAL FOR INDUSTRY: "FOOD, BEVERAGE & TOBACCO" $ 764 $ 4,388 $ 5,152
"METALS, MINERALS & MINING"
0 8 8 "PoHang Iron & Steel Co., Ltd.
(Metals, Mine $ 0 $ 578 $ 578
1 6 7 Alcan, Inc. $ 31 $ 186 $ 217
6 14 20 Alcan, Inc. $ 193 $ 427 $ 620
2 11 13 AngloGold Ltd. $ 64 $ 371 $ 435
</Table>
PAGE 1 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD INTERNATIONAL OPPORT. FUND
ACQUIRED FUND : FORTIS WORLDWIDE - INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
7 46 53 CRH plc $ 110 $ 711 $ 821
2 13 15 Pechiney S.A. $ 101 $ 593 $ 694
12 75 87 ThyssenKrupp AG $ 130 $ 803 $ 933
TOTAL FOR INDUSTRY: "METALS, MINERALS & MINING" $ 629 $ 3,669 $ 4,298
AEROSPACE & DEFENSE
36 214 250 BAE Systems plc $ 177 $ 1,036 $ 1,213
APPAREL & TEXTILE
5 25 30 Adidas-Salomon AG $ 282 $ 1,417 $ 1,699
10 55 65 Industria de Diseno Textil
S.A. $ 181 $ 1,031 $ 1,212
15 79 94 Tokyo Style Co. Ltd. $ 139 $ 730 $ 869
TOTAL FOR INDUSTRY: APPAREL & TEXTILE $ 602 $ 3,178 $ 3,780
BANKS
28 147 175 Allied Irish Banks plc $ 266 $ 1,422 $ 1,688
23 127 150 Australia & New Zealand Banking
Group Ltd. $ 204 $ 1,146 $ 1,350
61 357 418 Banca Monte dei Paschi di
Siena S.p.A. $ 149 $ 874 $ 1,023
5 29 34 Banco Popular Espanol S.A. $ 175 $ 971 $ 1,146
4 23 27 Barclays plc $ 117 $ 691 $ 808
4 24 28 Bayerische Hypo- und
Vereinsbank AG $ 115 $ 722 $ 837
4 23 27 BNP Paribas S.A. $ 315 $ 1,894 $ 2,209
0 1,035 1,035 Chinatrust Commercian Bank (Banks) $ 0 $ 525 $ 525
</Table>
PAGE 2 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND : THE HARTFORD INTERNATIONAL OPPORT. FUND
ACQUIRED FUND : FORTIS WORLDWIDE - INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
6 33 39 Credit Suisse Group $ 220 $ 1,192 $ 1,412
2 12 14 Deutsche Bank AG $ 122 $ 676 $ 798
13 72 85 ForeningsSparbanken AB (Swedbank) $ 132 $ 725 $ 857
12 69 81 Royal Bank of Scotland Group plc $ 297 $ 1,648 $ 1,945
12 68 80 Standard Chartered plc $ 121 $ 684 $ 805
7 41 48 Sumitomo Mitsui Banking Corp. $ 43 $ 254 $ 297
0 0 0 UFJ Holdings, Inc. $ 67 $ 424 $ 491
28 166 194 United Overseas Bank Ltd. $ 157 $ 928 $ 1,085
TOTAL FOR INDUSTRY: BANKS $2,500 $ 14,776 $17,276
BASIC MATERIALS
5 0 5 Pohang Iron & Steel Co. Ltd. ADR $ 81 $ 0 $ 81
BUSINESS SERVICES
100 579 679 Rentokil Initial plc $ 360 $ 2,080 $ 2,440
CHEMICALS
6 36 42 Akzo Nobel N.V. $ 263 $ 1,465 $ 1,728
6 33 39 Bayer AG $ 161 $ 954 $ 1,115
20 115 135 Imperial Chemical Industries plc $ 96 $ 541 $ 637
TOTAL FOR INDUSTRY: CHEMICALS $ 520 $ 2,960 $ 3,480
</Table>
COMMUNICATIONS
PAGE 3 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
Acquiring Fund: The Hartford International Opport. Fund
Acquired Fund: Fortis Worldwide -- International
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
0 2 2 "SK Telecom Co., Ltd.
(Communications)" $ 0 $ 449 $ 449
11 66 77 Alcatel S.A. $ 160 $ 997 $ 1,157
35 166 201 British Telecommunications plc $ 175 $ 837 $ 1,012
62 389 451 China Mobile (Hong Kong) Ltd. $ 190 $ 1,179 $ 1,369
46 266 312 COLT Telecom Group plc $ 78 $ 456 $ 534
8 47 55 Deutsche Telekom AG $ 128 $ 718 $ 846
5 31 36 Deutsche Telekom AG ADR $ 81 $ 481 $ 562
11 56 67 Korea Telecom Corp. ADR $ 221 $ 1,161 $ 1,382
0 0 0 Nippon Telegraph & Telephone Corp. $ 62 $ 362 $ 424
13 73 86 Nokia Oyj $ 268 $ 1,530 $ 1,798
0 0 0 NTT DoCoMo, Inc. $ 95 $ 542 $ 637
0 86 86 Orange S.A. (Communications) $ 0 $ 700 $ 700
14 86 100 Sonera Oyj $ 83 $ 487 $ 570
27 167 194 Telefonaktiebolaget LM Ericsson AB $ 117 $ 725 $ 842
6 33 39 Telefonica S.A. $ 68 $ 401 $ 469
8 45 53 Telefonica S.A. ADR $ 274 $ 1,600 $ 1,874
174 992 1,166 Vodafone Group plc $ 403 $ 2,294 $ 2,697
TOTAL FOR INDUSTRY: COMMUNICATIONS $ 2,403 $ 14,919 $ 17,322
COMPUTERS & OFFICE EQUIPMENT
0 505 505 "Compal Electronics, Inc.
(Computers & Office) $ 0 $ 402 $ 402
0 195 195 "Quanta Computers, Inc.
(Computers & Office) $ 0 $ 418 $ 418
3 18 21 Canon, Inc. $ 87 $ 524 $ 611
</Table>
PAGE 4 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
Acquiring Fund: The Hartford International Opport. Fund
Acquired Fund: Fortis Worldwide -- International
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: COMPUTERS & OFFICE EQUIPMENT $ 87 $1,344 $ 1,431
CONSUMER NON-DURABLES
6 40 46 Fuji Photo Film Co. Ltd. $ 198 $1,320 $ 1,518
2 14 16 L'OREAL S.A. $ 166 $ 940 $ 1,106
1 5 6 Nintendo Co. Ltd. $ 139 $ 817 $ 956
14 81 95 Reckitt Benckiser plc $ 200 $1,138 $ 1,338
TOTAL FOR INDUSTRY: CONSUMER NON-DURABLES $ 703 $4,215 $ 4,918
CONSUMER SERVICES
11 64 75 TPG NV $ 215 $1,242 $ 1,457
DRUGS
12 68 80 AstraZeneca plc $ 536 $3,069 $ 3,605
3 17 20 Aventis S.A. $ 228 $1,271 $ 1,499
12 64 76 Banyu Pharmaceutical Co. Ltd. $ 233 $1,244 $ 1,477
1 6 7 Fujisawa Pharmaceutical Co. Ltd. $ 24 $ 144 $ 168
3 18 21 Glaxo Wellcome plc ADR $ 176 $ 983 $ 1,159
1 9 10 GlaxoSmithKline plc $ 24 $ 229 $ 253
12 75 87 Novartis AG $ 467 $2,814 $ 3,281
3 17 20 Roche Holding AG $ 192 $1,156 $ 1,348
0 1 1 Serono S.A. $ 134 $ 788 $ 922
</Table>
PAGE 5 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
Acquiring Fund: The Hartford International Opport. Fund
Acquired Fund: Fortis Worldwide -- International
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: DRUGS $ 2,014 $ 11,698 $ 13,712
ELECTRONICS
0 7 7 "Samsung Electronics Co., Ltd.
(Electronics)" $ 0 $ 922 $ 922
9 51 60 Koninklijke (Royal) Philips
Electronics N.V. $ 200 $ 1,168 $ 1,368
3 16 19 Kyocera Corp. $ 184 $ 1,082 $ 1,266
14 81 95 NEC Corp. $ 127 $ 735 $ 862
1 4 5 Rohm Co. Ltd. $ 75 $ 426 $ 501
3 21 24 Siemens AG $ 162 $ 981 $ 1,143
6 36 42 Sony Corp. $ 235 $ 1,358 $ 1,593
0 1,980 1,980 United Microelectronics Corp.
(Electronics) $ 0 $ 1,629 $ 1,629
TOTAL FOR INDUSTRY: ELECTRONICS $ 983 $ 8,301 $ 9,284
ENERGY & SERVICES
18 104 122 ENI S.p.A. $ 231 $ 1,301 $ 1,532
7 40 47 Royal Dutch Petroleum Co. $ 336 $ 2,030 $ 2,366
2 13 15 Royal Dutch Petroleum Co.
NY Shares $ 111 $ 636 $ 747
2 14 16 Schlumberger Ltd. $ 111 $ 654 $ 765
6 31 37 Suez S.A. $ 173 $ 975 $ 1,148
4 21 25 TotalFinaElf S.A. $ 506 $ 3,005 $ 3,511
TOTAL FOR INDUSTRY: ENERGY & SERVICES $ 1,468 $ 8,601 $ 10,069
FINANCIAL SERVICES
11 60 71 Axa $ 241 $ 1,311 $ 1,552
</Table>
PAGE 6 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ACQUIRED FUND: FORTIS WORLDWIDE -
INTERNATIONAL OPPORT. FUND INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
6 29 35 CNP Assurances $ 177 $ 890 $ 1,067
0 49 49 Fortis Netherlands N.V.
(Financial Services) $ 0 $1,162 $ 1,162
0 0 0 Mizuho Holdings, Inc. $ 42 $ 248 $ 290
11 63 74 Nikko Cordial Corp. $ 59 $ 340 $ 399
4 21 25 Promise Co. Ltd. $ 239 $1,333 $ 1,572
TOTAL FOR INDUSTRY: FINANCIAL SERVICES $ 758 $5,284 $ 6,042
FOREST & PAPER PRODUCTS
10 59 69 Abitibi-Consolidated, Inc. $ 64 $ 358 $ 422
34 198 232 Smurfit (Jefferson) Group $ 67 $ 393 $ 460
3 18 21 UPM-Kymmene Oyj $ 101 $ 578 $ 679
TOTAL FOR INDUSTRY: FOREST & PAPER PRODUCTS $ 232 $1,329 $ 1,561
INSURANCE
13 72 85 Aegon N.V. $ 317 $1,809 $ 2,126
17 90 107 Alleanza Assicurazioni S.p.A. $ 179 $ 929 $ 1,108
10 52 62 CGNU plc $ 121 $ 616 $ 737
18 103 121 Lloyds TSB Group plc $ 177 $1,038 $ 1,215
TOTAL FOR INDUSTRY: INSURANCE $ 794 $4,392 $ 5,186
MEDIA & ENTERTAINMENT
7 38 45 British Sky Broadcasting plc $ 76 $ 430 $ 506
165 928 1,093 Granada plc $ 312 $1,748 $ 2,060
11 67 78 Pearson plc $ 128 $ 808 $ 936
</Table>
PAGE 7 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ACQUIRED FUND: FORTIS WORLDWIDE -
INTERNATIONAL OPPORT. FUND INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
25 143 168 Reed International plc $ 206 $ 1,168 $ 1,374
0 1 1 SKY Perfect Communications,
Inc. $ 112 $ 637 $ 749
4 26 30 Vivendi Universal S.A. $ 199 $ 1,211 $ 1,410
TOTAL FOR INDUSTRY: MEDIA & ENTERTAINMENT $ 1,033 $ 6,002 $ 7,035
MEDICAL INSTRUMENTS & SUPPLIES
5 31 36 Eisai Co. Ltd. $ 128 $ 793 $ 921
22 117 139 Gambro AB Class A $ 130 $ 683 $ 813
5 27 32 Hoya Corp. $ 299 $ 1,612 $ 1,911
TOTAL FOR INDUSTRY: MEDICAL INSTRUMENTS & SUPPLIES $ 557 $ 3,088 $ 3,645
REAL ESTATE
13 77 90 Cheung Kong (Holdings) Ltd. $ 110 $ 652 $ 762
99 557 656 New World Development Co. Ltd. $ 68 $ 382 $ 450
27 154 181 Sun Hung Kai Properties Ltd. $ 165 $ 944 $ 1,109
TOTAL FOR INDUSTRY: REAL ESTATE $ 343 $ 1,978 $ 2,321
RETAIL
6 36 42 Carrefour S.A. $ 311 $ 1,848 $ 2,159
13 79 92 Hennes & Mauritz AB $ 232 $ 1,378 $ 1,610
76 457 533 Marks & Spencer plc $ 318 $ 1,912 $ 2,230
TOTAL FOR INDUSTRY: RETAIL $ 861 $ 5,138 $ 5,999
SOFTWARE & SERVICES
1 3 4 Cap Gemini S.A. $ 68 $ 175 $ 243
</Table>
PAGE 8 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD ACQUIRED FUND: FORTIS WORLDWIDE -
INTERNATIONAL OPPORT. FUND INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
3 19 22 Check Point Software Technologies
Ltd. $ 86 $ 555 $ 641
4 20 24 SAP AG ADR $ 90 $ 517 $ 607
TOTAL FOR INDUSTRY: SOFTWARE & SERVICES $ 244 $ 1,247 $ 1,491
TECHNOLOGY
15 0 15 Orange S.A. $ 119 $ 0 $ 119
2 0 2 Samsung Electronics Co. Ltd. GDR $ 121 $ 0 $ 121
27 0 27 United Microelectronics ADR $ 151 $ 0 $ 151
TOTAL FOR INDUSTRY: TECHNOLOGY $ 391 $ 0 $ 391
TRANSPORTATION
41 233 274 British Airways plc $ 88 $ 507 $ 595
17 0 17 Ryanair Holdings plc $ 155 $ 0 $ 155
0 96 96 Rynair Holdings PLC
(Transportation) $ 0 $ 887 $ 887
4 26 30 Toyota Motor Corp. $ 109 $ 633 $ 742
TOTAL FOR INDUSTRY: TRANSPORTATION $ 352 $ 2,027 $ 2,379
UTILITIES
7 41 48 Endesa S.A. ADR $ 113 $ 626 $ 739
0 75 75 Korea Electric Power Corp.
(Utilities) $ 0 $ 1,175 $ 1,175
24 9 33 Korea Electric Power Corp. ADR $ 213 $ 78 $ 291
6 35 41 RWE AG $ 223 $ 1,356 $ 1,579
2 10 12 Vivendi Environnement $ 65 $ 391 $ 456
</Table>
PAGE 9 OF 10
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (UNAUDITED)
ACQUIRING FUND: THE HARTFORD INTERNATIONAL OPPORT. FUND
ACQUIRED FUND: FORTIS WORLDWIDE - INTERNATIONAL
<Table>
<Caption>
SHARES PAR (HISTORICAL) MARKET VALUE AMOUNT (HISTORICAL)
- ------------------------------------- -------------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) INTEREST MATURITY FUND FUND COMBINED
(IN '000'S) (IN '000'S) (IN '000'S) SECURITY RATE DATE (IN '000'S) (IN '000'S) (IN '000'S)
- ----------- ----------- ----------- -------- ---- ---- ----------- ----------- -----------
TOTAL FOR INDUSTRY: UTILITIES $ 614 $ 3,626 $ 4,240
TOTAL FOR SEGMENT: COMMON STOCK $ 19,685 $ 116,518 $136,203
PREFERRED STOCKS
COMMUNICATIONS
8 39 47 Telecomunicacoes Brasileiras
S.A. ADR $ 202 $ 1,000 $ 1,202
TOTAL FOR SEGMENT: PREFERRED STOCKS $ 202 $ 1,000 $ 1,202
S-T INVESTMENTS
FINANCE
1,730 0 1,730 Repurchase Agreement 2.57%
11-01-01 2.570% 11/01/2001 $ 1,730 $ 0 $ 1,730
0 0 0 U.S. Bank N.A. Money Market
Variable Rate $ 0 $ 0 $ 0
TOTAL FOR INDUSTRY: FINANCE $ 1,730 $ 0 $ 1,730
REPURCHASE AGREEMENT
0 4,993 4,993 Joint Repurchase Agreement 2.570% 11/1/01 $ 0 $ 4,993 $ 4,993
TOTAL FOR SEGMENT: S-T INVESTMENTS $ 1,730 $ 4,993 $ 6,723
TOTAL FOR FUND: THE HARTFORD INTERNATIONAL OPPORT. FUND $ 21,615 $ 122,511 $144,126
</Table>
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 10 OF 10
<Table>
<Caption>
PROFORMA STATEMENT OF ASSETS AND LIABILITIES
At October 31, 2001 (Unaudited)
FORTIS MONEY FUND (ACQUIRED) FORTIS HARTFORD
HARTFORD MONEY MARKET FUND (ACQUIRING) ACQUIRED ACQUIRING
FUND FUND
10/31/2001 10/31/2001 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
-------------- -------------- ------------- ------------
ASSETS
Investments, at value $209,067 $230,212 0 $439,279
Cash, receivables and other assets 848 3,153 0 4,001
-------------- -------------- ------------- ------------
TOTAL ASSETS 209,915 233,365 0 443,280
-------------- -------------- ------------- ------------
LIABILITIES
Income and Cap Gain distribution payable 19 12 0 31
Payable for investment securities purchased 0 2,985 0 2,985
Redemptions of capital stock 0 7,352 0 7,352
Accounts payable and accrued expenses 195 88 0 283
-------------- -------------- ------------- ------------
TOTAL LIABILITIES 214 10,437 0 10,651
-------------- -------------- ------------- ------------
NET ASSETS
Net proceeds of capital stock, par value $.01 per share 209,701 222,928 0 432,629
Unrealized appreciation (depreciation) of investments
in securities 0 0 0 0
Undistributed net investment income 0 0 0 0
Accumulated net realized gain from sale of investments 0 0 0 0
-------------- -------------- ------------- ------------
TOTAL NET ASSETS $209,701 $222,928 0 $432,629
============== ============== ============= ============
OUTSTANDING SHARES
Class A 202,662,473 86,748,000 0 (a) 289,410,473
Class B 3,027,374 48,998,000 2,728,681 (a) 54,754,055
Class C 1,281,979 53,873,000 0 (a) 55,154,979
Class H 2,728,681 0 (2,728,681) (a) 0
Class Y 0 33,309,000 0 (a) 33,309,000
209,700,507 222,928,000 0 (a) 432,628,507
NET ASSET VALUE
Class A $1.00 $1.00 $1.00
Class B $1.00 $1.00 $1.00
Class C $1.00 $1.00 $1.00
Class H $1.00 $0.00 $0.00
Class Y $0.00 $1.00 $1.00
</Table>
(a) Reflects increase (decrease) in shares due to differences in the net asset
values of the funds. Fortis Class H will merge to Hartford Class B.
<Table>
<Caption>
PROFORMA STATEMENT OF OPERATIONS
For the Year Ended October 31, 2001 (Unaudited)
FORTIS MONEY FUND (ACQUIRED) FORTIS HARTFORD
HARTFORD MONEY MARKET FUND (ACQUIRING) ACQUIRED ACQUIRING
FUND FUND
10/31/01 10/31/01 PROFORMA PROFORMA
(HISTORICAL) (HISTORICAL) ADJUSTMENTS COMBINED
-------------- -------------- ------------- ------------
NET INVESTMENT INCOME:
Income
Interest Income $10,162 $6,831 0 $16,993
Dividend Income 0 0 0 0
Fee income 0 0 0 0
-------------- -------------- ------------- ------------
Total Income 10,162 6,831 0 16,993
-------------- -------------- ------------- ------------
Expenses:
Investment advisory and management fees 1,246 737 (207) (a) 1,776
Transfer agent fees 187 332 377 (a) 896
Distribution fees 46 836 718 (a) 1,600
Registration fees 117 51 (36) (a) 132
Custodian fees, gross 6 6 (6) (a) 6
Custodian fees, expense offset 0 (1) 0 (1)
Accounting services 0 29 42 (a) 71
Directors' fees and expenses 22 0 (22) (a) (0)
Other 72 26 (35) 63
-------------- -------------- ------------- ------------
Total expenses (before reimbursements and waivers) 1,696 2,016 831 4,543
Expense reimbursements 0 (183) (297) (480)
Class A distribution fees waived 0 (31) (101) (a) (132)
-------------- -------------- ------------- ------------
Total expenses, net 1,696 1,802 433 3,931
-------------- -------------- ------------- ------------
NET INVESTMENT INCOME (LOSS) 8,466 5,029 (433) 13,062
-------------- -------------- ------------- ------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from investments 3 3 0 6
Net change in unrealized appreciation (depreciation) of
investments 0 0 0 0
-------------- -------------- ------------- ------------
NET GAIN ON INVESTMENTS 3 3 0 6
-------------- -------------- ------------- ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $8,469 $5,032 ($433) $13,068
============== ============== ============= ============
</Table>
(a) For further information regarding variations in expense structure, please
look to footnotes on expense proforma.
PRO FORMA FOOTNOTES OF MERGER BETWEEN ACQUIRED FUND AND ACQUIRING FUND
October 31, 2001 (Unaudited)
1. GENERAL
The accompanying proforma financial statements are presented to show the effect
of the proposed acquisition of Fortis Series Fund, Inc. - Fortis Money Fund
(Acquired Fund) by The Hartford Mutual Funds, Inc. - Hartford Money Market Fund
(Acquiring Fund) as if such acquisition had taken place as of the close of
business on October 31, 2000.
Under the terms of the Agreement and Plan of Reorganization, the combination of
the Acquired Fund and the Acquiring Fund will be taxed as a tax-free business
combination and accordingly will be accounted for by a method of accounting for
tax-free mergers of investment companies (sometimes referred to as the pooling
without restatement method). The acquisition would be accomplished by an
acquisition of the net assets of the Acquired Fund in exchange for shares of the
Acquiring Fund at net asset value. The statements of assets and liabilities and
the related statements of operations of the Acquired Fund and the Acquiring Fund
have been combined as of and for the twelve-month period ended October 31, 2001.
The accompanying pro forma financial statements should be read in conjunction
with the financial statements and schedule of investments of the Acquiring Fund,
which are included in its annual report dated October 31, 2001.
The following notes refer to the accompanying pro forma financial statements as
if the above mentioned acquisition of the Acquired Fund and the Acquiring Fund
had taken place as of the close of business on October 31, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The Acquiring Fund is organized under the laws of the State of Maryland,
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The Acquiring Fund issues multiple class shares. Class A shares are sold with a
front-end sales charge of up to 5.50%. Class B shares are sold without a
front-end sales charge and may be subject to a contingent deferred sales charge
which is assessed on the lesser of the net asset value of the shares at the time
of redemption or the original purchase price, and declines from 5.00% to zero
depending on the period of time the shares are held, and such shares
automatically convert to Class A after eight years. Class C shares are sold with
a front-end sales charge of up to 1% and a contingent deferred sales charge of
up to 1%. Class Y shares are sold to certain eligible institutional investors
without a sales charge. All classes of shares have identical voting, redemption,
dividend, liquidation and other rights and the same terms and conditions, except
that each class may have different expenses, which may affect performance.
Income and realized and unrealized gains or losses on investments are allocated
to each class of shares based on its relative net assets.
The significant accounting policies followed by the Acquiring Fund are
summarized as follows:
SECURITY VALUATION: Short-term securities held in the Acquiring Fund are valued
at amortized cost or original cost plus accrued interest receivable, both of
which approximate market value. The use of this method results in a constant net
asset value of $1.00 under normal market conditions.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
accounted for on the trade date. Interest income and expenses are recorded on
the accrual basis.
JOINT TRADING ACCOUNT: The Acquiring Fund, pursuant to an exemptive order issued
by the Securities and Exchange Commission, may transfer uninvested cash balances
into a joint trading account (for all Hartford Funds) managed by The Hartford
Investment Management Company (HIMCO). These balances may be invested in one or
more repurchase agreements and/or short-term money market instruments.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement by which the
seller of a security agrees to repurchase the security sold at a mutually agreed
upon time and price. At the time the Acquiring Fund enters into a repurchase
agreement, the value of the underlying collateral security (ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities, which serve to collateralize the repurchase agreement,
are held by the Acquiring Fund's custodian in book entry or physical form in the
custodial account of the Acquiring Fund. Repurchase agreements are valued at
cost plus accrued interest receivable. All repurchase agreements are executed
through the Acquiring Fund's custodian, State Street Bank.
FEDERAL INCOME TAXES: The Acquiring Fund intends to qualify, under the Internal
Revenue Code, as a regulated investment company, and, if so qualified, will not
have to pay federal income taxes to the extent that its taxable net income is
distributed. On a calendar year basis, the Acquiring Fund intends to distribute
substantially all of its net investment income and realized gains, if any, to
avoid payment of federal excise taxes. It is the policy of the Fund to declare
daily and pay monthly distributions from net investment income. Distributions
from the Fund are not paid on shares until the day following the date on which
the shares are issued. The distributions are payable in cash or reinvested in
additional shares of the fund at net asset value without any charge to the
shareholder.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
ILLIQUID SECURITIES: The Fund is permitted to invest up to 10% of its net assets
in illiquid securities. "Illiquid Securities" are those that may not be sold or
disposed of in the ordinary course of business, at approximately the price used
to determine a Fund's net asset value per share. Each Fund may also purchase
certain restricted (unregistered) securities, commonly known as Rule 144A
securities, that can be resold to institutions and which may be determined to be
liquid pursuant to policies and guidelines established by the Fund's Board of
Directors.
PAYMENTS TO RELATED PARTIES: Hartford Investment Financial Services Company
(HIFSCO), a wholly owned indirect subsidiary of The Hartford Financial Services
Group, Inc. (The Hartford), is the investment manager for the Acquiring Fund. As
investment manager, HIFSCO has overall investment supervisory responsibility for
the Acquiring Fund. In addition, HIFSCO provides administrative personnel,
services, equipment and facilities and office space for proper operation of the
Acquiring Fund. HIFSCO has contracted with HIMCO for the provision of day to day
investment management services in accordance with the Fund's investment
objective and policies. The Acquiring Fund pays a fee to HIFSCO, a portion of
which may be used to compensate HIMCO. The Acquiring Fund's investment advisory
and management fees are computed at an annual rate of .50% of the first $500
million of average daily net assets, .45% for the next $500 million, and .40%
for average daily net assets over $1 billion.
In addition to the investment advisory and management fee, Classes A, B and C
pay HIFSCO (the Acquiring Fund's principal underwriter) distribution fees equal
to .35% of average daily net assets for Class A and 1.00% of average daily net
assets for Classes B and C on an annual basis, to be used to compensate those
who sell shares of the fund and to pay certain other expenses of selling fund
shares. The Class A Rule 12b-1 fee for the Acquiring Fund has been voluntarily
capped at .30% through at least February 28, 2003. The cap may be removed at any
time thereafter. There is no distribution plan for Class Y Shares.
Allocable expenses incurred by The Hartford Funds (including the Acquiring Fund)
are allocated to each Hartford Fund (including the Acquiring Fund) in proportion
to the average daily net assets of each Hartford Fund (including the Acquiring
Fund), except where allocation of certain expenses is more fairly made directly
to a specific Fund (including the Acquiring Fund) or to specific classes within
in a Fund (including the Acquiring Fund). The Hartford has voluntarily agreed to
limit the total operating expense of the Class A, B, C and Y shares of the
Acquiring Fund, exclusive of taxes, interest, brokerage commissions, certain
distribution expenses and extraordinary expenses, until at least February 28,
2003. For Class A the limit is 1.00%, Classes B and C the limit is 1.70% and for
Class Y the limit is .55%. The Hartford may terminate such voluntary and
temporary fee waivers and expense limitation arrangements at any time after
February 28, 2003 without notice.
The Hartford and its subsidiaries provide facilities and office equipment, as
well as perform certain other services, including fund accounting and financial
reporting to the Acquiring Fund. Certain officers of the Acquiring Fund are
directors and/or officers of HIFSCO, HIMCO and/or The Hartford or its
subsidiaries. No officer of the Funds receives any compensation directly from
the Acquiring Fund.
For the twelve-month period ended October 31, 2001, legal fees and expenses of
the Acquired Fund were paid to a law firm of which the secretary of the fund is
a partner.
The Acquiring Fund has entered into certain expense offset arrangements with its
Custodian bank. The amount of the Acquiring Fund's expense reductions is shown
on the accompanying Statement of Operations as custodian fee expense offset.
LINE OF CREDIT: The Acquiring Fund participates in a $500,000,000 committed
revolving line of credit facility. The facility is to be used for temporary or
emergency purposes. Under the arrangement, the Acquiring Fund is required to own
securities having a market value in excess of 300% of the total bank borrowing.
The interest rate on the borrowing varies depending on the nature of the loan.
The facility also requires a fee to be paid based on the amount of the
commitment, which has not been utilized.
3. PRO FORMA ADJUSTMENTS
The accompanying pro forma financial statements reflect changes in fund shares
as if the merger had taken place on October 31, 2001, and adjustments made to
expenses for duplicated services that would not have been incurred if the merger
had taken place as of the close of business on October 31, 2000.
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS
0 2,000 2,000 "Cargill, Inc." 2.570% 1/14/02 $0 $2,000 $2,000
0 2,000 2,000 "Caterpillar Financial Services, Inc." 3.633% 2/28/02 $0 $2,001 $2,001
0 3,000 3,000 "Goldman Sachs Group, Inc. (The)" 2.820% 12/27/01 $0 $3,001 $3,001
0 1,000 1,000 "Merrill Lynch & Co., Inc." 2.360% 1/28/02 $0 $1,000 $1,000
0 1,000 1,000 "Morgan (J.P.) Chase & Co., Inc." 2.510% 1/28/02 $0 $1,001 $1,001
0 5,000 5,000 American Honda Finance Corp. 3.630% 2/8/02 $0 $5,000 $5,000
0 2,000 2,000 Australia and New Zealand Banking Group 3.360% 12/13/01 $0 $2,000 $2,000
0 1,000 1,000 Bank of America Corp. 3.745% 2/11/02 $0 $1,000 $1,000
0 3,000 3,000 Bank One Corp. 3.125% 12/20/01 $0 $3,000 $3,000
0 2,000 2,000 Chase Manhattan Corp. 2.486% 4/23/02 $0 $2,002 $2,002
0 1,000 1,000 Citicorp 3.898% 2/21/02 $0 $1,001 $1,001
0 2,000 2,000 First Union National Bank 3.558% 11/21/01 $0 $2,000 $2,000
0 2,500 2,500 Fleet National Bank 3.804% 2/1/02 $0 $2,501 $2,501
0 2,500 2,500 General Motors Acceptance Corp. 3.620% 12/10/01 $0 $2,500 $2,500
0 2,000 2,000 Hewlett-Packard Co. 2.556% 10/15/02 $0 $2,000 $2,000
0 3,000 3,000 International Business Machines Corp. 2.180% 12/12/01 $0 $2,993 $2,993
0 2,000 2,000 John Deere Capital Corp. 2.380% 1/14/02 $0 $2,000 $2,000
0 2,500 2,500 Morgan Stanley Dean Witter & Co. 3.330% 12/17/01 $0 $2,501 $2,501
0 2,500 2,500 PNC Bank 2.415% 1/24/02 $0 $2,501 $2,501
0 2,000 2,000 Salomon Smith Barney 2.493% 7/24/02 $0 $2,003 $2,003
0 4,000 4,000 Toyota Motor Credit Corp. 2.370% 10/11/02 $0 $3,999 $3,999
</Table>
PAGE 1 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
0 4,000 4,000 Unilever 2.473% 10/24/02 $0 $4,004 $4,004
0 1,000 1,000 Wells Fargo & Co. 2.430% 4/26/02 $0 $1,001 $1,001
TOTAL FOR INDUSTRY: $0 $53,009 $53,009
TOTAL FOR SEGMENT: CORPORATE BONDS $0 $53,009 $53,009
S-T INVESTMENTS
0 3,500 3,500 "Anheuser-Busch Cos., Inc." 3.680% 4/3/02 $0 $3,441 $3,441
0 3,000 3,000 "Caterpillar Financial Services, Inc." 2.390% 11/28/01 $0 $2,995 $2,995
0 1,500 1,500 "Gannett Co., Inc." 2.490% 11/13/01 $0 $1,499 $1,499
0 2,000 2,000 "Goldman Sachs Group, Inc. (The)" 2.400% 11/20/01 $0 $1,997 $1,997
0 5,000 5,000 "Honeywell International, Inc." 2.670% 11/26/01 $0 $4,991 $4,991
0 3,500 3,500 "KFW International Finance, Inc." 2.800% 3/7/02 $0 $3,460 $3,460
0 5,000 5,000 "Merck & Co., Inc." 2.330% 12/11/01 $0 $4,987 $4,987
0 3,500 3,500 "Nordea North America, Inc." 2.760% 3/19/02 $0 $3,463 $3,463
0 3,000 3,000 "Nordea North America, Inc." 3.320% 11/6/01 $0 $2,999 $2,999
0 3,000 3,000 "Pfizer, Inc." 2.050% 1/23/02 $0 $2,986 $2,986
0 2,000 2,000 "Pfizer, Inc." 2.450% 11/28/01 $0 $1,996 $1,996
0 5,000 5,000 "SBC Communications, Inc." 3.520% 11/8/01 $0 $4,993 $4,993
0 5,000 5,000 "Svenska Handelsbanken, Inc." 2.420% 3/6/02 $0 $4,954 $4,954
0 1,000 1,000 "Texeco, Inc." 3.537% 9/9/02 $0 $1,000 $1,000
0 5,000 5,000 "Texeco, Inc." 2.510% 11/13/01 $0 $4,992 $4,992
0 5,000 5,000 "UBS Finance (Delaware), Inc." 2.700% 12/18/01 $0 $4,980 $4,980
</Table>
PAGE 2 OF 18
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
0 5,000 5,000 "Wal-Mart Stores, Inc." 2.430% 11/2/01 $0 $4,999 $4,999
0 3,000 3,000 Abbey National North America Corp. 2.390% 2/5/02 $0 $2,981 $2,981
0 1,500 1,500 American Express Credit Corp. 3.300% 11/7/01 $0 $1,499 $1,499
0 3,500 3,500 American Express Credit Corp. 2.350% 1/28/02 $0 $3,468 $3,468
0 3,000 3,000 Bradford & Bingley Building PLC 2.080% 1/28/02 $0 $2,985 $2,985
0 1,500 1,500 Bradford & Bingley Building PLC 2.460% 11/29/01 $0 $1,497 $1,497
0 5,000 5,000 Coca-Cola Co. (The) 2.290% 12/4/01 $0 $4,990 $4,990
0 5,000 5,000 Federal Home Loan Mortgage Corp. 3.670% 3/15/02 $0 $4,929 $4,929
0 1,500 1,500 Federal National Mortgage Association 3.740% 3/22/02 $0 $1,478 $1,478
0 1,500 1,500 Ford Motor Credit Co. 2.800% 11/14/01 $0 $1,498 $1,498
0 3,500 3,500 General Electric Capital Corp. 4.650% 11/19/01 $0 $3,496 $3,496
0 1,500 1,500 General Electric Capital Corp. 2.960% 4/10/02 $0 $1,480 $1,480
0 2,500 2,500 General Motors Acceptance Corp. 2.850% 12/4/01 $0 $2,493 $2,493
0 5,000 5,000 Gillette Co. (The) 2.050% 1/26/02 $0 $4,967 $4,967
0 5,000 5,000 Halifax PLC 2.440% 12/27/01 $0 $4,981 $4,981
0 3,000 3,000 International Lease Financing Corp. 2.380% 11/19/01 $0 $2,996 $2,996
0 30,023 30,023 Joint Repurchase Agreement 2.567% 11/1/01 $0 30,023 30,023
0 3,000 3,000 Monsanto Co. 2.340% 12/10/01 $0 $2,992 $2,992
0 3,500 3,500 Nationwide Building Society 3.300% 11/13/01 $0 $3,496 $3,496
0 2,000 2,000 Salomon Smith Barney 2.370% 12/3/01 $0 $1,996 $1,996
0 4,000 4,000 State Street Corp. 2.280% 12/3/01 $0 $3,992 $3,992
0 1,000 1,000 Swedbank 3.490% 4/29/02 $0 $983 $983
0 3,500 3,500 Toronto-Dominion Holdings Corp. 3.650% 4/11/02 $0 $3,443 $3,443
</Table>
PAGE 3 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
0 1,500 1,500 Toronto-Dominion Holdings Corp. 2.510% 11/27/01 $0 $1,497 $1,497
0 1,000 1,000 Toyota Motor Credit Corp. 2.430% 11/16/01 $0 $999 $999
0 5,000 5,000 United Technologies Corp. 2.850% 3/22/02 $0 $4,943 $4,943
0 5,000 5,000 Verizon Global Funding 2.300% 1/7/02 $0 $4,954 $4,954
0 2,500 2,500 Walt Disney Co. 3.570% 3/8/02 $0 $2,469 $2,469
0 2,000 2,000 Walt Disney Co. 2.810% 11/5/01 $0 $1,999 $1,999
0 1,000 1,000 Washington Post Co. 2.700% 12/14/01 $0 $997 $997
0 3,000 3,000 Well Fargo & Co. 2.360% 11/13/01 $0 $2,998 $2,998
0 3,000 3,000 Westpac Capitol Corp. 3.700% 4/5/02 $0 $2,952 $2,952
TOTAL FOR INDUSTRY: $0 $177,203 $177,203
BASIC MATERIALS
5,000 0 5,000 Pfizer Inc. 2.290% 12/14/2001 $4,980 $0 $4,980
1,000 0 1,000 Pfizer, Inc. 2.450% 11/28/2001 $996 $0 $996
TOTAL FOR INDUSTRY:
BASIC MATERIALS $5,976 $0 $5,976
CAPITAL GOODS
6,000 0 6,000 Honeywell International 2.670% 11/26/2001 $5,973 $0 $5,973
6,000 0 6,000 IBM Corp. 2.180% 12/12/2001 $5,984 $0 $5,984
6,000 0 6,000 Textron, Inc. 2.450% 12/19/2001 $5,964 $0 $5,964
1,000 0 1,000 United Technologies Corp. 2.500% 04/22/2002 $985 $0 $985
5,000 0 5,000 United Technologies Corp. 2.850% 03/22/2002 $4,926 $0 $4,926
TOTAL FOR INDUSTRY: CAPITAL GOODS $23,832 $0 $23,832
</Table>
PAGE 4 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICAL
6,000 0 6,000 7 Eleven Inc. 2.180% 12/13/2001 $5,984 $0 $5,984
1,000 0 1,000 American Honda Finance Corp. 2.420% 11/08/2001 $997 $0 $997
1,000 0 1,000 Ford Motor Credit Co. 2.800% 11/14/2001 $997 $0 $997
6,000 0 6,000 General Motors Acceptance Corp. 2.850% 12/04/2001 $5,970 $0 $5,970
1,000 0 1,000 Gillette Co. 2.960% 03/13/2002 $985 $0 $985
2,000 0 2,000 Hewlett-Packard Co., Floater, 10-15-2002 10/15/2002 $2,000 $0 $2,000
5,000 0 5,000 Wal-mart 2.390% 11/05/2001 $4,997 $0 $4,997
TOTAL FOR INDUSTRY: CONSUMER CYCLICAL $21,930 $0 $21,930
CONSUMER STAPLES
2,500 0 2,500 Anheuser Busch Companies, Inc. 3.560% 05/06/2002 $2,430 $0 $2,430
2,500 0 2,500 Anheuser Busch Companies, Inc. 3.680% 04/03/2002 $2,432 $0 $2,432
5,000 0 5,000 Unilever N.V., Floating Rate, 10-24-2002 10/24/2002 $5,007 $0 $5,007
TOTAL FOR INDUSTRY: CONSUMER STAPLES $9,869 $0 $9,869
ENERGY
5,000 0 5,000 Texaco, Inc. FRN 09/09/2002 $5,000 $0 $5,000
FINANCE
5,000 0 5,000 American Express Credit Corp. 3.300% 11/07/2001 $4,973 $0 $4,973
1,000 0 1,000 American Express Credit Corp. 2.960% 04/22/2002 $982 $0 $982
5,000 0 5,000 American Honda Finance FRN 10/09/2002 $5,000 $0 $5,000
</Table>
PAGE 5 OF 8
PROFORMA SCHEDULE OF INVESTMENTS AS OF OCTOBER 31, 2001 (Unaudited)
ACQUIRING FUND: THE HARTFORD MONEY MARKET FUND ACQUIRED FUND: FORTIS MONEY FUND
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
6,000 0 6,000 ANZ Delaware Inc. 2.270% 11/20/2001 $5,989 $0 $5,989
5,000 0 5,000 Bank One Corp., FRN 01/07/2002 $5,002 $0 $5,002
1,000 0 1,000 Bradford & Bingley plc 2.460% 11/29/2001 $995 $0 $995
5,000 0 5,000 Bradford & Bingley Plc. 2.220% 12/17/2001 $4,983 $0 $4,983
4,000 0 4,000 Caterpillar Financial Services. 2.390% 11/28/2001 $3,989 $0 $3,989
5,000 0 5,000 Chase Manhattan Corp., FRN 04/23/2002 $5,004 $0 $5,004
1,000 0 1,000 FHLMC 3.680% 03/28/2002 $972 $0 $972
4,000 0 4,000 FHLMC 3.670% 03/15/2002 $3,894 $0 $3,894
1,000 0 1,000 FHLMC 3.750% 03/27/2002 $972 $0 $972
5,000 0 5,000 Fleet National Bank FRN 02/01/2002 $5,002 $0 $5,002
1,000 0 1,000 FNMA 3.740% 03/22/2002 $972 $0 $972
5,000 0 5,000 General Electric Capital Corp. 3.450% 11/02/2001 $4,972 $0 $4,972
1,000 0 1,000 General Electric Capital Corp. 2.960% 04/10/2002 $983 $0 $983
2,000 0 2,000 Goldman Sachs Group, Inc. 2.400% 11/20/2001 $1,992 $0 $1,992
4,000 0 4,000 Goldman Sachs Group, Inc. FRN 3.741% 08/21/2002 $4,005 $0 $4,005
6,000 0 6,000 Halifax plc 2.440% 12/27/2001 $5,962 $0 $5,962
6,000 0 6,000 International Lease Finance Corp. 2.380% 11/19/2001 $5,976 $0 $5,976
5,000 0 5,000 KFW International Finance, Inc. 3.680% 04/05/2002 $4,863 $0 $4,863
5,000 0 5,000 Nordea North America, Inc. 2.800% 02/28/2002 $4,936 $0 $4,936
4,098 0 4,098 Repurchase Agreement 2.56% 11-01-01 2.560% 11/01/2001 $4,098 $0 $4,098
1,000 0 1,000 Salomon Smith Barney Hld 2.370% 12/03/2001 $996 $0 $996
5,000 0 5,000 Salomon Smith Barney Holdings FRN 07/24/2002 $5,007 $0 $5,007
5,000 0 5,000 State Street Corp. 2.280% 12/03/2001 $4,987 $0 $4,987
</Table>
PAGE 6 OF 8
Proforma Schedule of Investments as of October 31, 2001 (Unaudited)
Acquiring Fund: The Hartford Money Acquired Fund: Fortis Money Fund
Market Fund
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
1,000 0 1,000 Svenska Handelsbanken, Inc. 3.350% 03/08/2002 $983 $0 $983
1,000 0 1,000 Svenska Handelsbanken, Inc. 2.420% 03/06/2002 $989 $0 $989
4,000 0 4,000 Svenska Handelsbanken, Inc. 3.520% 11/02/2001 $3,966 $0 $3,966
5,000 0 5,000 Swedbank 2.340% 12/05/2001 $4,980 $0 $4,980
1,000 0 1,000 Swedbank, Inc. 2.350% 11/21/2001 $996 $0 $996
5,000 0 5,000 Toronto Dominion Holdings USA, Inc. 3.650% 04/11/2002 $4,864 $0 $4,864
1,000 0 1,000 Toronto Dominion Holdings USA, Inc. 2.510% 11/27/2001 $996 $0 $996
5,000 0 5,000 Toyota Motor Credit Corp., Floating Rate 10/11/2002 $4,999 $0 $4,999
Note
2 0 2 U.S. Bank N.A. Money Market Variable Rate $2 $0 $2
1,000 0 1,000 UBS Finance (Delaware), Inc. 2.700% 12/18/2001 $993 $0 $993
5,000 0 5,000 Westpac Capital Corp. 3.700% 04/05/2002 $4,862 $0 $4,862
TOTAL FOR INDUSTRY: FINANCE $126,136 $0 $126,136
TECHNOLOGY
1,000 0 1,000 SBC Communications, Inc. 2.450% 12/19/2001 $994 $0 $994
5,000 0 5,000 SBC Communications, Inc. 3.520% 11/08/2001 $4,955 $0 $4,955
5,000 0 5,000 Verizon Global Funding 2.300% 01/14/2002 $4,970 $0 $4,970
1,000 0 1,000 Verizon Global Funding Corp. 2.500% 04/30/2002 $985 $0 $985
1,000 0 1,000 Walt Disney Co 2.810% 11/05/2001 $998 $0 $998
3,500 0 3,500 Walt Disney Co. 3.570% 03/08/2002 $3,422 $0 $3,422
TOTAL FOR INDUSTRY: TECHNOLOGY $16,324 $0 $16,324
TOTAL FOR SEGMENT: S-T INVESTMENTS $209,067 $177,203 $386,270
</Table>
PAGE 7 OF 8
Proforma Schedule of Investments as of October 31, 2001 (Unaudited)
Acquiring Fund: The Hartford Money Acquired Fund: Fortis Money Fund
Market Fund
<Table>
<Caption>
SHARES PAR(HISTORICAL) MARKET VALUE AMOUNT(HISTORICAL)
- ------------------------------------ ---------------------------------
ACQUIRED ACQUIRING ACQUIRED ACQUIRING
FUND FUND COMBINED(1) FUND FUND COMBINED
(IN (IN (IN INTEREST MATURITY (IN (IN (IN
'000'S) '000'S) '000'S) SECURITY RATE DATE '000'S) '000'S) '000'S)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL FOR FUND:
THE HARTFORD MONEY MARKET FUND $209,067 $230,212 $439,279
</Table>
1. Management does not anticipate having to sell any securities as a result of
the merger.
PAGE 8 OF 8
PART C
OTHER INFORMATION
ITEM 15. INDEMNIFICATION.
Incorporated herein by reference to Article V of the Articles of
Incorporation filed with the Registrant's initial registration statement on
April 9, 1996.
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim is made for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person in connection with the securities being registered), the registrant
undertakes that it will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
ITEM 16. EXHIBITS.
(1) Articles of Incorporation (a)
(2) By-Laws (a)
(3) Not applicable
(4) Agreement and Plan of Reorganization is attached as
Exhibit A to the Prospectus/Proxy Statement included
in Part A of this Registration Statement on Form N-14
(5) See (1) above
(6a) Form of Investment Advisory Agreement (a)
(6b) Form of Sub-Advisory Agreement (a)
(6c) Investment Management Agreement with Hartford
Investment Financial Services Company (c)
(6d) Investment Sub-Advisory Agreement with Wellington
Management Company LLP (c)
(6e) Investment Services Agreement with The Hartford
Investment Management Company (c)
(6f) Form of Amendment Number 1 to Investment Management
Agreement (d)
(6g) Form of Amendment Number 1 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (d)
(6h) Form of Amendment Number 2 to Investment Management
Agreement (e)
(6i) Form of Amendment Number 2 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (e)
(6j) Form of Amendment Number 1 to Investment Services
Agreement with The Hartford Investment Management
Company (g)
(6k) Form of Amendment Number 3 to Investment Management
Agreement (g)
(6l) Form of Amendment Number 3 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (g)
(6m) Form of Amendment Number 4 to Investment Management
Agreement (h)
(6n) Form of Amendment Number 4 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (h)
(6o) Form of Amendment Number 5 to Investment Management
Agreement (i)
(6p) Form of Amendment Number 5 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (i)
(6q) Form of Amendment Number 6 to Investment Management
Agreement (j)
(6r) Form of Amendment Number 6 to Sub-Advisory Agreement
between Hartford Investment Financial Services
Company and Wellington Management Company LLP (j)
(7a) Form of Principal Underwriting Agreement (a)
(7b) Form of Dealer Agreement with the Distributor (b)
2
(7c) Form of Amendment Number 1 to Principal Underwriting
Agreement (d)
(7d) Form of Amendment Number 2 to Principal Underwriting
Agreement (e)
(7e) Form of Amendment Number 3 to Principal Underwriting
Agreement (g)
(7f) Form of Amendment Number 4 to Principal Underwriting
Agreement (h)
(7g) Form of Amendment Number 5 to Principal Underwriting
Agreement (i)
(7h) Form of Amendment Number 6 to Principal Underwriting
Agreement (j)
(8) Not applicable
(9a) Form of Custodian Agreement (b)
(9b) Form of Amendment Number 1 to Custodian Agreement (d)
(9c) Form of Amendment Number 2 to Custodian Agreement (e)
(9d) Form of Amendment Number 3 to Custodian Agreement (g)
(9e) Form of Amendment Number 4 to Custodian Agreement (h)
(9f) Form of Letter Amendment to Custodian Agreement (i)
(9g) Form of Letter Amendment to Custodian Agreement (j)
(10a) Form of Rule 12b-1 Distribution Plan for Class A
Shares (a)
(10b) Form of Rule 12b-1 Distribution Plan for Class B
Shares (a)
(10c) Form of Rule 12b-1 Distribution Plan for Class C
Shares (f)
(10d) Form of Amended Rule 12b-1 Distribution Plan for
Class A Shares (d)
(10e) Form of Amended Rule 12b-1 Distribution Plan for
Class B Shares (d)
(10f) Form of Amendment Number 1 to Amended and Restated
Rule 12b-1 Distribution Plan for Class A Shares (e)
3
(10g) Form of Amendment Number 1 to Amended and Restated
Rule 12b-1 Distribution Plan for Class B Shares (e)
(10h) Form of Amendment Number 2 to Amended and Restated
Rule 12b-1 Distribution Plan for Class A Shares (g)
(10i) Form of Amendment Number 2 to Amended and Restated
Rule 12b-1 Distribution Plan for Class B Shares (g)
(10j) Form of Amendment Number 1 to Rule 12b-1 Distribution
Plan for Class C Shares (g)
(10k) Form of Amendment Number 3 to Amended and Restated
Rule 12b-1 Distribution Plan for Class A Shares (h)
(10l) Form of Amendment Number 3 to Amended and Restated
Rule 12b-1 Distribution Plan for Class B Shares (h)
(10m) Form of Amendment Number 2 to Rule 12b-1 Distribution
Plan for Class C Shares (h)
(10n) Form of Amendment Number 4 to Amended and Restated
Rule 12b-1 Distribution Plan for Class A Shares (i)
(10o) Form of Amendment Number 4 to Amended and Restated
Rule 12b-1 Distribution Plan for Class B Shares (i)
(10p) Form of Amendment Number 3 to Rule 12b-1 Distribution
Plan for Class C Shares (i)
(10q) Form of Amendment Number 5 to Amended and Restated
Rule 12b-1 Distribution Plan for Class A Shares (j)
(10r) Form of Amendment Number 5 to Amended and Restated
Rule 12b-1 Distribution Plan for Class B Shares (j)
(10s) Form of Amendment Number 4 to Rule 12b-1 Distribution
Plan for Class C Shares (j)
(10t) Form of Rule 18f-3 Plan (a)
(10u) Form of Amended Rule 18f-3 Plan (d)
(10v) Form of Amendment Number 1 to Amended and Restated
Rule 18f-3 Plan (e)
(10w) Form of Amended and Restated Rule 18f-3 Plan to Add
Class C Shares (f)
4
(10x) Form of Amendment Number 1 to Amended and Restated
Rule 18f-3 Plan which added Class C Shares (g)
(10y) Form of Amendment Number 2 to Amended and Restated
Rule 18f-3 Plan which added Class C Shares (h)
(10z) Form of Amendment Number 3 to Amended and Restated
Rule 18f-3 Plan which added Class C Shares (i)
(10aa) Form of Amendment Number 4 to Amended and Restated
Rule 18f-3 Plan which added Class C Shares (j)
(11) Opinion and consent of Kevin J. Carr, in-house
counsel to the Registrant, with respect to the
legality of the securities being registered (k).
(12) Opinion and consent of Dorsey & Whitney LLP with
respect to tax matters (to be filed by amendment).
(13) Not applicable.
(14a) Consent of Arthur Andersen LLP (filed herewith).
(14b) Consent of KPMG LLP (filed herewith).
(15) Not applicable.
(16) Power of attorney (k).
(17) Form of proxy card (k).
- ----------
(a) Incorporated herein by reference to Registrant's Initial Registration
Statement filed on April 9, 1996.
(b) Incorporated herein by reference to Registrant's Pre-Effective
Amendment #1 filed on June 27, 1996.
(c) Incorporated herein by reference to Registrant's Post-Effective
Amendment #3 filed on June 20, 1997.
(d) Incorporated herein by reference to Registrant's Post-Effective
Amendment #4 filed on October 16, 1997.
(e) Incorporated herein by reference to Registrant's Post-Effective
Amendment #5 filed on February 6, 1998.
(f) Incorporated herein by reference to Registrant's Post-Effective
Amendment #7 filed on May 13, 1998.
5
(g) Incorporated herein by reference to Registrant's Post-Effective
Amendment #9 filed on July 15, 1998.
(h) Incorporated herein by reference to Registrant's Post-Effective
Amendment #13 filed on February 2, 2000.
(i) Incorporated herein by reference to Registrant's Post-Effective
Amendment #16 filed on August 10, 2000.
(j) Incorporated herein by reference to Registrant's Post-Effective
Amendment #17 filed on February 14, 2001.
(k) Incorporated herein by reference to Registrant's Registration Statement
on Form N-14 filed on November 9, 2001.
ITEM 17. UNDERTAKINGS.
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a prospectus which is
a part of this Registration Statement by any person or party who is deemed to be
an underwriter within the meaning of Rule 145(c) of the Securities Act, the
reoffering prospectus will contain the information called for by the applicable
registration form for reofferings by persons who may be deemed underwriters, in
addition to the information called for by the other items of the applicable
form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an amendment to the
Registration Statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.
(3) The undersigned Registrant agrees to file, by post-effective
amendment, an opinion of counsel or a copy of a ruling of the Internal Revenue
Service supporting the tax consequences of the proposed reorganization within a
reasonable time after receipt of such opinion or ruling.
SIGNATURES
As required by the Securities Act of 1933, this registration statement
has been signed on behalf of the registrant, in the city of Hartford, and the
state of Connecticut on the 19th day of December, 2001.
THE HARTFORD MUTUAL FUNDS, INC.
By: David M. Znamierowski*
Its: President
6
As required by the Securities Act of 1933, this registration statement
has been signed by the following persons in the capacities and on the date
indicated.
<Table>
<Caption>
Signature Title
- --------- -----
David M. Znamierowski* President
(Chief Executive Officer
& Director)
George R. Jay* Controller & Treasurer
(Chief Accounting Officer &
Chief Financial Officer)
Winifred E. Coleman* Director
Duane E. Hill* Director
William A. O'Neil* Director
Millard H. Pryor, Jr.* Director
Lowndes A. Smith* Director
John K. Springer* Director
</Table>
/s/ Kevin J. Carr Dated: December 19, 2001
- ------------------------
* By Kevin J. Carr
Attorney-in-fact
7