SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant x
Filed by a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2)
Definitive Proxy Statement
x Definitive Additional Materials
Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Excelsior Funds, Inc.
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(Name of Registrant as Specified in Its Charter)
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Payment of Filing Fee (Check the appropriate box):
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Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
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previously. Identify the previous filing by registration statement number, or
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Dear Client:
As we recently discussed, I am pleased to announce that some important changes
are being considered for the U.S. Trust-advised Excelsior family of funds.
Under the proposed changes, five of the equity funds would be consolidated into
the Excelsior Equity Fund which incorporates our growth, value and small cap
investment strategies. In our opinion, this will allow for more meaningful
measurements of performance against appropriate industry benchmarks, while
potentially reducing portfolio volatility. These changes involve only the
equity funds, and a summary describing these proposed changes in enclosed.
Specifics are outlined in the combined prospectus/proxy statement we are sending
to you today.
I want to emphasize that this restructuring does not constitute a shift away
from our belief in theme equity investing; quite the contrary. We continue to
believe that the major economic and demographic themes we have identified wil
drive business growth into the next century. Therefore, we expect that these
themes will remain the foundation of our equity investment policy.
Going forward, our recommended asset allocation will include greater exposure to
international equities, as we believe it unlikely that domestic equities will
continue their recent stellar performance over the next few years. We now
recommend that international equities compose 20% of the equity portion of most
client portfolios. We also believe that an increased exposure to alternative
investments, such as venture capital, can help to ensure that your portfolio
continues to meet your long-term needs.
Please read carefully the proxy materials we have sent to you regarding the
proposed changes to the Excelsior funds. If you also own Excelsior funds
outside of your Wealth Management Account, you will be receiving separate proxy
material directly from Excelsior. I encourage you to participate in this
important vote by returning the proxies before the deadline. A vote in favor of
the proposal will help us to ensure that we continue to provide the best
selection of funds for your investment needs.
I will continue to review the asset allocation in your account throughout the
transition process to ensure that your investments reflect your objectives and
long-term goals. I will also be speaking to you in the near future to review
proposed changes to your account and to address any issues concerning your
account. Of course, if you have any questions, please do not hesitate to call.
Sincerely,
THE PROPOSED CHANGES TO EXCELSIOR FAMILY OF FUNDS
. Subject to shareholder approval, five of the existing equity theme funds -
the Excelsior Aging of America Fund, the Excelsior Global Competitors Fund,
the Excelsior Communication and Entertainment Fund, the Excelsior
Environmental Fund, and the Excelsior Productivity Enhancers Fund - would
be merged into the Excelsior Equity Fund, which would be renamed the
Excelsior Blended Equity Fund.
. The Excelsior Long-Term Supply of Energy Fund would be renamed the
Excelsior Energy and Natural Resources Fund. The fund would continue to
invest in companies that are likely to benefit from the availability,
development and delivery of clean, secure hydrocarbon and other energy
sources. The fund would also be able to invest in securities representing
other natural resources, including precious metals.
. The Excelsior Business and Industrial Restructuring Fund would be renamed
the Excelsior Value and Restructuring Fund. The fund would continue to
invest in companies that are likely to benefit from a restructuring or
redeployment of their assets and operations in order to become more
competitive or profitable.
. The Excelsior Early Life Cycle Fund would be renamed the Excelsior Small
Capitalization Fund. The Fund would continue to invest in smaller
companies in the earlier stages of their development or in more mature
companies engaged in new and potentially higher growth operations.
. The Excelsior Emerging Americas Fund would be renamed the Excelsior Latin
America Fund. The fund would invest in companies based in South and
Central America and Mexico that are likely to benefit from government
reform policies and improving economic conditions in the region.
The Excelsior family of funds is also planning to introduce two new equity
funds. A large cap growth fund is planned which would invest in equities
believed to be of high quality and high growth potential. In addition, a real
estate fund is planned which would invest primarily in the equity securities of
real estate companies, including real estate investment trusts (REITs). The
Excelsior Income and Growth Fund, as well as the three remaining international
equity funds, the eight fixed-income funds, and the four money market funds,
will be unaffected.
Please see the reverse side for a list of the Excelsior funds that would be
available if the changes are approved. Be sure to participate in the upcoming
proxy vote to ensure that these important changes take place.
THE NEW EXCELSIOR FUNDS
DOMESTIC EQUITY
Excelsior Blended Equity Fund
Excelsior Value and Restructuring Fund
Excelsior Income and Growth Fund
Excelsior Small Capitalization Fund
Excelsior Energy and Natural Resources Fund
VENTURE CAPITAL
Excelsior Private Equity Fund II (closed-end fund)
INTERNATIONAL EQUITY
Excelsior International Fund
Excelsior Latin America Fund
Excelsior Pacific-Asia Fund
Excelsior Pan European Fund
TAXABLE FIXED INCOME
Excelsior Short-Term Government Securities Fund
Excelsior Intermediate-Term Managed Income Fund
Excelsior Managed Income Fund
TAX-EXEMPT FIXED INCOME
Excelsior Short-Term Tax-Exempt Securities Fund
Excelsior Intermediate-Term Tax-Exempt Fund
Excelsior Long-Term Tax-Exempt Fund
Excelsior New York Intermediate-Term Tax-Exempt Fund
Excelsior California Tax-Exempt Income Fund
MONEY MARKET
Excelsior Money Fund
Excelsior Government Fund
Excelsior Treasury Money Fund
Excelsior Short-Term Tax-Exempt Fund
Any mutual funds or other nondeposit investment products in which you invest (i)
are not insured by the FDIC; (ii) are not a deposit or obligation of, or
guaranteed by, United States Trust Company of New York or any other depository
institution; and (iii) are subject to investment risks, including possible loss
of the principal amount invested.
For additional information about these funds, including sales charges and
expenses, please obtain a prospectus and read it carefully before you invest.
June 24, 1997
Dear Client:
As we recently discussed, I am pleased to announce that some important changes
are being considered for the U.S. Trust-advised Excelsior family of funds.
Under the proposed changes, five of the equity funds would be consolidated into
the Excelsior Equity Fund which incorporates our growth, value and small cap
investment strategies. In our opinion, this will allow for more meaningful
measurements of performance against appropriate industry benchmarks, while
potentially reducing portfolio volatility. These changes involve any the equity
funds, and a summary describing these proposed changes is enclosed. Specifics
are outlined in the combined prospectus/proxy statement we are sending to you
today.
I want to emphasize that this restructuring does not constitute a shift away
from our belief in theme equity investing; quite the contrary. We continue to
believe that the major economic and demographic themes we have identified will
drive business growth into the next century. Therefore, we expect that these
themes will remain the foundation of our equity investment policy.
Going forward, our recommended asset allocation will include greater exposure to
international equities, as we believe it unlikely that domestic equities will
continue their recent stellar performance over the next few years. We now
recommend that international equities compose 20% of the equity portion of most
client portfolios. We also believe that an increased exposure to alternative
investments, such as venture capital, can help to ensure that your portfolio
continues to meet your long-term needs.
Please read carefully the proxy materials we have sent to you regarding the
proposed changes to the Excelsior funds. If you also own Excelsior funds
outside of your Wealth Management Account, you will be receiving separate proxy
material directly from Excelsior. I encourage you to participate in this
important vote by returning the proxies before the deadline. A vote in favor of
the proposal will help us to ensure that we continue to provide the best
selection of funds for your investment needs.
Page 2
I will continue to review the asset allocation in your account throughout the
transition process to ensure that your investments reflect your objectives and
long-term goals. I will also be speaking to you in the near future to review
proposed changes to your account and to address any issues concerning your
account. Of course, if you have any questions, please do not hesitate to call.
Sincerely,
Sincerely,
THE PROPOSED CHANGES TO THE EXCELSIOR FAMILY OF FUNDS
. Subject to shareholder approval, five of the existing equity theme funds -
the Excelsior Aging of America Fund, the Excelsior Global Competitors Fund,
the Excelsior Communication and Entertainment Fund, the Excelsior
Environmental Fund, and the Excelsior Productivity Enhancers Fund - would
be merged into the Excelsior Equity Fund, which would be renamed the
Excelsior Blended Equity Fund.
. The Excelsior Long-Term Supply of Energy Fund would be renamed the
Excelsior Energy and Natural Resources Fund. The fund would continue to
invest in companies that are likely to benefit from the availability,
development and delivery of clean, secure hydrocarbon and other energy
sources. The fund would also be able to invest in securities representing
other natural resources, including precious metals.
. The Excelsior Business and Industrial Restructuring Fund would be renamed
the Excelsior Value and Restructuring Fund. The fund would continue to
invest in companies that are likely to benefit from a restructuring or
redeployment of their assets and operations in order to become more
competitive or profitable.
. The Excelsior Early Life Cycle Fund would be renamed the Excelsior Small
Capitalization Fund. The fund would continue to invest in smaller
companies in the earlier stages of their development or in more mature
companies engaged in new and potentially higher growth operations.
. The Excelsior Emerging Americas Fund would be renamed the Excelsior Latin
America Fund. The fund would invest in companies based in South and
Central America and Mexico that are likely to benefit from government
reform politics and improving economic conditions in the region.
The Excelsior family of funds is also planning to introduce two new equity
funds. A large cap growth fund is planned which would invest in equities
believed to be of high quality and high growth potential. In addition, a real
estate fund is planned which would invest primarily in the equity securities of
real estate companies, including real estate investment trusts (REITs). The
Excelsior Income and Growth Fund, as well as the three remaining international
equity funds, the eight fixed-income funds, and the four money market funds,
will be unaffected.
Please see the reverse side for a list of the Excelsior funds that would be
available if the changes are approved. Be sure to participate in the upcoming
proxy vote to ensure that these important changes take place.
THE NEW EXCELSIOR FUNDS
DOMESTIC EQUITY
Excelsior Blended Equity Fund
Excelsior Value and Restructuring Fund
Excelsior Income and Growth Fund
Excelsior Small Capitalization Fund
Excelsior Energy and Natural Resources Fund
VENTURE CAPITAL
Excelsior Private Equity Fund II (closed-end fund)
INTERNATIONAL EQUITY
Excelsior International Fund
Excelsior Latin America Fund
Excelsior Pacific-Asia Fund
Excelsior Pan European Fund
TAXABLE FIXED INCOME
Excelsior Short-Term Government Securities Fund
Excelsior Intermediate-Term Managed Income Fund
Excelsior Managed Income Fund
TAX-EXEMPT FIXED INCOME
Excelsior Short-Term Tax-Exempt Securities Fund
Excelsior Intermediate-Term Tax-Exempt Fund
Excelsior Long-Term Tax-Exempt Fund
Excelsior New York Intermediate-Term Tax-Exempt Fund
Excelsior California Tax-Exempt Income Fund
MONEY MARKET
Excelsior Money Fund
Excelsior Government Fund
Excelsior Treasury Money Fund
Excelsior Short-Term Tax-Exempt Fund
Any mutual funds or other nondeposit investment products in which you invest (i)
are not insured by te FDIC; (ii) are not a deposit or obligation of, or
guaranteed by, United States Trust Company of New York or any other depository
institution; and (iii) are subject to investment risks, including possible loss
of the principal amount invested.
For additional information about these funds, including sales charges and
expenses, please obtain a prospectus and read it carefully before you invest.
Dear Shareholder:
The board of directors of the Excelsior equity funds is proposing certain
changes which we believe will enhance our ability to serve your investment
needs. Very briefly, these proposed changes would merge five of our equity
funds into the Excelsior Equity Fund. These changes are enclosed in the
combination proxy/prospectus.
It is the opinion of United States Trust Company of New York, the advisor to the
funds, that the proposed changes would reduce volatility and potentially enhance
performance. The board of Excelsior encourages you to participate in this very
important vote by returning the proxies before the deadline. We believe that a
vote in favor of the proposal will enhance our ability to serve your investment
needs.
As always, our goal is to provide you with excellent performances and the
highest level of service. If you have any questions about the proposed changes,
please do not hesitate to call your fund representative.
Sincerely,
Frederick S. Wonham