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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT [X] FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]
- --------------------------------------------------------------------------------
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
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LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
August 13, 2001
Dear Shareholder:
The Funds listed in the Notice of Special Meeting of Shareholders will hold a
special meeting on September 26, 2001, at 2:00 p.m., to vote on the proposals
listed in the proxy statement.
Liberty Financial Companies, Inc., the parent company of the Funds' investment
advisors and affiliated sub-advisors, has entered into an agreement to sell its
asset management business, including the Funds' investment advisors and their
affiliated sub-advisors, to Fleet National Bank, an indirect wholly owned
subsidiary of FleetBoston Financial Corporation, a U.S. financial holding
company. The sale will cause the Funds' current advisory agreements to
terminate. In order for the management of each Fund to continue uninterrupted
after the sale, we are asking you to approve new advisory agreements, including
any sub-advisory and portfolio management agreements, for the Funds. The
proposed new advisory agreements are substantially identical to the Funds'
current advisory agreements, except as described in the attached proxy
statement. NO CHANGES IN ADVISORY FEE RATES OR SERVICES ARE BEING PROPOSED.
Your vote is very important. The Boards of Trustees of the Funds listed in the
Notice of Special Meeting have approved the new agreements and recommend that
you vote in favor of the agreements. The Liberty Variable Investment Trust Board
of Trustees also recommends that you vote in favor of the persons proposed for
election as Trustees at the Special Meeting. Please complete, sign and date the
enclosed proxy card and return it in the enclosed postage-paid return envelope.
This will ensure that your vote is counted, even if you cannot attend the
meeting in person.
It is important that you vote promptly.
Sincerely,
/s/ STEPHEN E. GIBSON
STEPHEN E. GIBSON
President
G-60/587G-0601
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IMPORTANT NEWS
FOR FUND SHAREHOLDERS
WHILE WE ENCOURAGE YOU TO READ THE FULL TEXT OF THE ENCLOSED PROXY STATEMENT,
HERE IS A BRIEF OVERVIEW OF MATTERS TO BE VOTED UPON.
QUESTIONS AND ANSWERS
Q. What am I being asked to vote "For" in this proxy?
A. You are being asked to vote for proposals to:
1. Approve a new investment advisory agreement for your Fund with your
Fund's current investment advisor, on substantially identical terms as
the current investment advisory agreement. NO CHANGE IN ADVISORY FEE
RATES OR SERVICES IS BEING PROPOSED.
2. Approve a new sub-advisory agreement for your Fund, if applicable, with
your Fund's current sub-advisor, on substantially identical terms as the
current sub-advisory agreement. NO CHANGE IN SUB-ADVISORY FEE RATES OR
SERVICES IS BEING PROPOSED.
3. Approve new portfolio management agreement(s) for your Fund, if
applicable, with your Fund's current portfolio manager(s), on
substantially identical terms as the current portfolio management
agreement(s). NO CHANGE IN PORTFOLIO MANAGEMENT FEE RATES OR SERVICES IS
BEING PROPOSED.
4. Elect Trustees for the Liberty Variable Investment Trust.
Q. Why am I being asked to vote on new agreements?
A. Liberty Financial Companies, Inc. ("Liberty Financial"), the parent company
of the investment advisors and affiliated sub-advisors to the Funds listed in
the Notice of Special Meeting of Shareholders, has entered into an agreement
to sell its asset management business, including the Funds' investment
advisors and their affiliated sub-advisors, to Fleet National Bank ("Fleet"),
an indirect wholly owned subsidiary of FleetBoston Financial Corporation, a
U.S. financial holding company. The sale will result in the termination of
the current investment advisory agreements and any sub-advisory agreements
and portfolio management agreements for the Funds. The sale will not be
completed unless a number of conditions are met. One of the conditions of the
sale is that shareholders of a percentage of the Funds and other accounts
managed by Liberty Financial affiliates must approve the proposed new
agreements. Your
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Fund's Board of Trustees has approved, and recommends that you approve, the
new agreements applicable to your Fund.
Q. What prompted the sale of Liberty Financial's asset management business to
Fleet?
A. On November 1, 2000, Liberty Financial announced that it had retained CS
First Boston to help explore strategic alternatives, including the possible
sale of Liberty Financial. Liberty Financial ultimately determined to sell
its asset management business to Fleet.
Q. How will the sale of Liberty Financial's asset management business
potentially benefit me?
A. The Funds' Boards of Trustees believe that there may be benefits of scale
from combining the asset management businesses of Fleet and Liberty
Financial, including the ability to attract and retain key personnel, greater
access to resources for investment professionals of the advisors, enhanced
technology and customer service, and the expected availability of additional
investment options for shareholders of the Funds.
Q. How do the proposed new agreements differ from the current agreements?
A. The proposed agreements are substantially identical to the current
agreements. They differ only in their beginning dates and terms and certain
other minor provisions. A comparison of the proposed new agreements is
included in the proxy statement under the heading "New Advisory, Sub-Advisory
and Portfolio Management Agreements."
Q. Will this change the advisory fees on my Fund?
A. No. Advisory fees will remain the same.
Q. Will there be any advisor changes?
A. No. The advisors that currently manage the Funds are expected to continue to
manage the Funds after the sale of Liberty Financial's asset management
business, using the same investment strategies and objectives currently in
place.
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Q. How do the Boards of Trustees recommend that I vote on these proposals?
A. The Boards of Trustees recommend that you vote "FOR" each of the proposals.
The Boards believe that each of these proposals is in the best interests of
your Fund and its shareholders.
Q. How can I vote my proxy?
A. For your convenience, there are two ways you can vote:
- By Mail: vote, sign and return the enclosed proxy card
- In person: September 26, 2001, at 2:00 p.m. at One Financial Center,
Boston, Massachusetts
IT IS IMPORTANT THAT YOU VOTE PROMPTLY.
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LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
(THE "TRUSTS")
ONE FINANCIAL CENTER
BOSTON, MASSACHUSETTS 02111
LIBERTY VARIABLE
INVESTMENT TRUST
Colonial Global Equity Fund, Variable Series
Colonial High Yield Securities Fund, Variable Series
Colonial International Fund for Growth, Variable Series
Colonial International Horizons Fund, Variable Series
Colonial Small Cap Value Fund, Variable Series
Colonial Strategic Income Fund, Variable Series
Colonial U.S. Growth & Income Fund, Variable Series
Crabbe Huson Real Estate Investment Fund, Variable Series
Liberty All-Star Equity Fund, Variable Series
Liberty Newport Japan Opportunities Fund, Variable Series
Liberty S&P 500 Index Fund, Variable Series
Liberty Select Value Fund, Variable Series
Liberty Value Fund, Variable Series
Newport Tiger Fund, Variable Series
Rydex Financial Services Fund, Variable Series
Rydex Health Care Fund, Variable Series
Stein Roe Global Utilities Fund, Variable Series
STEINROE VARIABLE
INVESTMENT TRUST
Liberty Federal Securities Fund, Variable Series
Stein Roe Balanced Fund, Variable Series
Stein Roe Growth Stock Fund, Variable Series
Stein Roe Money Market Fund, Variable Series
Stein Roe Small Company Growth Fund, Variable Series
(the "Funds")
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* Please fold and detach card at perforation before mailing *
Please fill in box(es) as shown using black or blue ink or
number 2 pencil. PLEASE DO NOT USE FINE POINT PENS. [X]
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH PROPOSAL
AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE THEIR
DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL MEETING.
IF YOU DO NOT INTEND PERSONALLY TO ATTEND THIS SPECIAL MEETING, PLEASE COMPLETE
AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY
AGREEMENT. [ ] [ ] [ ]
2. BALANCED FUND ONLY: TO APPROVE A
NEW SUB-ADVISORY AGREEMENT WITH NORDEA
SECURITIES, INC. [ ] [ ] [ ]
3. TO CONSIDER AND ACT UPON ANY OTHER
MATTERS THAT PROPERLY COME BEFORE
THE MEETING AND ANY ADJOURNED SESSION
OF THE MEETING.
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Shareholders of record at the close of business on July 16, 2001 are entitled to
notice of and to vote at the meeting and any adjourned session.
By order of the Board of Trustees,
William J. Ballou
Secretary of each Trust
August 13, 2001
PLEASE RESPOND. YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU
OWN. YOU CAN VOTE EASILY AND QUICKLY BY MAIL OR IN PERSON.
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PROXY STATEMENT
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
(THE "TRUSTS")
ONE FINANCIAL CENTER
BOSTON, MASSACHUSETTS 02111
LIBERTY VARIABLE INVESTMENT TRUST
Colonial Global Equity Fund,
Variable Series
Colonial High Yield Securities
Fund, Variable Series
Colonial International Fund for Growth, Variable Series
Colonial International Horizons Fund, Variable Series
Colonial Small Cap Value Fund, Variable Series
Colonial Strategic Income Fund, Variable Series
Colonial U.S. Growth & Income Fund, Variable Series
Crabbe Huson Real Estate Investment Fund, Variable Series
Liberty All-Star Equity Fund, Variable Series
Liberty Newport Japan Opportunities Fund, Variable Series
Liberty S&P 500 Index Fund,
Variable Series
Liberty Select Value Fund, Variable Series
Liberty Value Fund,
Variable Series
Newport Tiger Fund,
Variable Series
Rydex Financial Services Fund, Variable Series
Rydex Health Care Fund,
Variable Series
Stein Roe Global Utilities Fund, Variable Series
(collectively, the "LVIT Funds")
STEINROE VARIABLE INVESTMENT TRUST
Liberty Federal Securities Fund, Variable Series
Stein Roe Balanced Fund, Variable Series
Stein Roe Growth Stock Fund, Variable Series
Stein Roe Money Market Fund, Variable Series
Stein Roe Small Company Growth Fund, Variable Series
(collectively, the "SRVIT Funds" and,
together with the LVIT Funds, the "Funds")
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The Trustees of the Trusts (the "Trustees") are soliciting proxies from the
shareholders of each of the Funds in connection with a Special Meeting of
Shareholders of each Fund (the "Meeting"). The Meeting has been called to be
held on September 26, 2001 at 2:00 p.m. at One Financial Center, Boston,
Massachusetts. The meeting notice, this Proxy Statement and proxy cards are
being sent to shareholders beginning on or about August 13, 2001.
The only items of business that the Trustees expect will come before the Meeting
are:
(1) approval of a new Investment Advisory Agreement for each Fund (each a "New
Advisory Agreement") with, as applicable, Liberty Advisory Services Corp. or
Stein Roe & Farnham Incorporated (collectively, the "Advisors");
(2) approval of a New Sub-Advisory Agreement (each a "New Sub-Advisory
Agreement") for each of Colonial Global Equity Fund, Variable Series,
Colonial High Yield Securities Fund, Variable Series, Colonial International
Fund for Growth, Variable Series, Colonial International Horizons Fund,
Variable Series, Colonial Small Cap Value Fund, Variable Series, Colonial
Strategic Income Fund, Variable Series, Colonial U.S. Growth & Income Fund,
Variable Series, Crabbe Huson Real Estate Investment Fund, Variable Series,
Liberty All-Star Equity Fund, Variable Series, Liberty Newport Japan
Opportunities Fund, Variable Series, Liberty S&P 500 Index Fund, Variable
Series, Liberty Select Value Fund, Variable Series, Liberty Value Fund,
Variable Series, Newport Tiger Fund, Variable Series, Rydex Financial
Services Fund, Variable Series, Rydex Health Care Fund, Variable Series,
Stein Roe Balanced Fund, Variable Series and Stein Roe Global Utilities
Fund, Variable Series (collectively, the "Sub-Advised Funds") with, as
applicable, Colonial Management Associates, Inc., Crabbe Huson Group, Inc.,
Liberty Asset Management Company, Newport Fund Management, Inc., Nordea
Securities, Inc. and Stein Roe & Farnham Incorporated (collectively, the
"Sub-Advisors");
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(3) approval of a new Portfolio Management Agreement or new Portfolio Management
Agreements (each a "New Portfolio Management Agreement") for each of the
Liberty All-Star Equity Fund, Variable Series, Liberty S&P 500 Index Fund,
Variable Series, Rydex Financial Services Fund, Variable Series and Rydex
Health Care Fund, Variable Series (collectively, the "Portfolio Managed
Funds") with, as applicable, Mastrapasqua & Associates, Inc., Oppenheimer
Capital, Boston Partners Asset Management, L.P., Westwood Management Corp.,
TCW Investment Management Company, Rydex Global Advisors and SSgA Funds
Management, Inc. (collectively, the "Portfolio Managers"); and
(4) the election of Trustees of Liberty Variable Investment Trust.
SUMMARY OF PROPOSALS AND FUNDS AFFECTED
<Table>
<Caption>
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1. PROPOSAL 3. PROPOSAL
TO APPROVE 2. PROPOSAL TO APPROVE
A NEW TO APPROVE A NEW
INVESTMENT A NEW PORTFOLIO 4. PROPOSAL
ADVISORY SUB-ADVISORY MANAGEMENT TO ELECT
NAME OF FUND AGREEMENT AGREEMENT AGREEMENT(S) TRUSTEES
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LIBERTY VARIABLE
INVESTMENT TRUST
Colonial Global Equity
Fund, Variable Series X X X
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Colonial High Yield
Securities Fund,
Variable Series X X X
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Colonial International
Fund for Growth,
Variable Series X X X
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Colonial International
Horizons Fund,
Variable Series X X X
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Colonial Small Cap
Value Fund, Variable
Series X X X
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Colonial Strategic
Income Fund, Variable
Series X X X
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</Table>
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12
<Table>
<Caption>
- ---------------------------------------------------------------------------------
1. PROPOSAL 3. PROPOSAL
TO APPROVE 2. PROPOSAL TO APPROVE
A NEW TO APPROVE A NEW
INVESTMENT A NEW PORTFOLIO 4. PROPOSAL
ADVISORY SUB-ADVISORY MANAGEMENT TO ELECT
NAME OF FUND AGREEMENT AGREEMENT AGREEMENT(S) TRUSTEES
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Colonial U.S. Growth &
Income Fund, Variable
Series X X X
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Crabbe Huson Real
Estate Investment
Fund, Variable Series X X X
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Liberty All-Star Equity
Fund, Variable Series X X X X
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Liberty Newport Japan
Opportunities Fund,
Variable Series X X X
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Liberty S&P 500 Index
Fund, Variable Series X X X X
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Liberty Select Value
Fund, Variable Series X X X
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Liberty Value Fund,
Variable Series X X X
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Newport Tiger Fund,
Variable Series X X X
- ---------------------------------------------------------------------------------
Rydex Financial
Services Fund,
Variable Series X X X X
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Rydex Health Care Fund,
Variable Series X X X X
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Stein Roe Global
Utilities Fund,
Variable Series X X X
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STEINROE VARIABLE
INVESTMENT TRUST
Liberty Federal
Securities Fund,
Variable Series X
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Stein Roe Balanced
Fund, Variable Series X X
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</Table>
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<Table>
<Caption>
- ---------------------------------------------------------------------------------
1. PROPOSAL 3. PROPOSAL
TO APPROVE 2. PROPOSAL TO APPROVE
A NEW TO APPROVE A NEW
INVESTMENT A NEW PORTFOLIO 4. PROPOSAL
ADVISORY SUB-ADVISORY MANAGEMENT TO ELECT
NAME OF FUND AGREEMENT AGREEMENT AGREEMENT(S) TRUSTEES
- ---------------------------------------------------------------------------------
Stein Roe Growth Stock
Fund, Variable Series X
- ---------------------------------------------------------------------------------
Stein Roe Money Market
Fund, Variable Series X
- ---------------------------------------------------------------------------------
Stein Roe Small Company
Growth Fund, Variable
Series X
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</Table>
- ---------------
An "X" denotes that the Fund is affected by the proposal and that the Fund's
shareholders are being solicited with respect to that proposal.
PROPOSALS 1, 2 AND 3
NEW ADVISORY, SUB-ADVISORY AND PORTFOLIO
MANAGEMENT AGREEMENTS
As explained below, the proposed New Advisory Agreement for each Fund, the
proposed New Sub-Advisory Agreement for each Sub-Advised Fund and the proposed
New Portfolio Management Agreement(s) for each Portfolio Managed Fund (the New
Advisory Agreements, the New Sub-Advisory Agreements and the New Portfolio
Management Agreements, as applicable for a Fund, are referred to collectively as
the "New Agreements") are substantially identical (except for their terms and
dates and certain other non-material changes) to the Investment Advisory
Agreement, Sub-Advisory Agreement and Portfolio Management Agreement(s)
currently in effect for that Fund (the "Current Advisory Agreement," "Current
Sub-Advisory Agreement," and "Current Portfolio Management Agreement(s),"
respectively, and, collectively, the "Current Agreements").
The reason the Trustees are proposing a New Advisory Agreement for each Fund, a
New Sub-Advisory Agreement for each Sub-Advised Fund and a New Portfolio
Management Agreement or New Portfolio Management Agreements for each Portfolio
Managed Fund is that the Current Agreements will terminate when the Advisors'
parent company,
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Liberty Financial Companies, Inc. ("Liberty Financial"), sells each of the
Advisors and its other subsidiaries that operate its asset management business
(the "Asset Management Segment") to Fleet National Bank, a national banking
association ("Fleet"). As a result of this acquisition, the Advisors and the
other subsidiaries will become direct or indirect, wholly owned subsidiaries of
Fleet. The Investment Company Act of 1940, as amended (the "Investment Company
Act"), provides generally that the advisory agreement of an investment company,
as well as any sub-advisory or portfolio management agreement, such as any of
the Current Sub-Advisory Agreements and the Current Portfolio Management
Agreements, must provide for automatic termination if assigned, such as when the
investment advisor or its parent company undergoes a significant change of
ownership.
In addition, Liberty Financial has agreed to sell, in a separate transaction,
all of the issued and outstanding capital stock of the subsidiaries constituting
the annuity segment of Liberty Financial's business to Sun Life Assurance
Company of Canada, a Canadian corporation (the "Annuity Sale"). The sale of the
Asset Management Segment to Fleet and the Annuity Sale are not conditioned on
each other. Liberty Financial has entered into a Merger Agreement with Liberty
Mutual Insurance Company ("Liberty Mutual") (the majority stockholder of Liberty
Financial), which provides that, following the acquisition of the Asset
Management Segment by Fleet and the Annuity Sale, LFC Acquisition Corporation, a
wholly owned subsidiary of Liberty Mutual, will merge with and into Liberty
Financial, with Liberty Financial being the surviving corporation (the
"Merger"). In connection with the Merger, holders of Liberty Financial common
stock, other than Liberty Financial, Liberty Mutual and their respective direct
and indirect subsidiaries and other than those holders of Liberty Financial
common stock who validly perfect and exercise their appraisal rights under
Massachusetts law, will be entitled to receive an amount of cash equal to
$33.44, subject to adjustment, per share of common stock. Once such merger
consideration is paid, such shares will be cancelled.
The Trustees have carefully considered the matter and have concluded that it is
appropriate to enter into the New Advisory Agreement, New Sub-Advisory Agreement
and New Portfolio Management Agreement(s), as applicable for each Fund, so that
the Advisors, Sub-Advisors and Portfolio Managers can continue, following the
acquisition of the Asset Management Segment by Fleet, to manage each Fund on the
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same terms as are now in effect. The Trustees also have approved an interim
advisory agreement, sub-advisory agreement and portfolio management
agreement(s), as applicable, for each Fund, pursuant to Rule 15a-4 under the
Investment Company Act, which will be entered into immediately following the
closing of the acquisition of the Asset Management Segment by Fleet only if a
particular Fund has not at that time received the requisite shareholder vote for
the applicable New Agreement(s) at the Meeting. See the section "Basis for the
Trustees' Recommendations" below for further information on these interim
agreements.
The acquisition of the Asset Management Segment by Fleet will occur only if
various conditions are satisfied (or waived by the parties, if permitted by
law). Those conditions include, among others, the receipt of certain government
approvals, approval or consent from investment advisory clients of the Advisors,
the affiliated Sub-Advisors and other Liberty Financial affiliates (including
mutual fund clients) which represent a specified percentage of Liberty
Financial's total assets under management as of March 31, 2001, the avoidance of
a certain level of net redemptions from portfolios managed by the Advisors and
certain of their affiliates that make up the Asset Management Segment and
approval of the acquisition by the requisite vote of the shareholders of Liberty
Financial. Liberty Financial currently expects that the acquisition will occur
during the latter part of 2001, but the acquisition could be delayed. If the
acquisition does not occur, the New Agreements would not be needed because the
automatic termination of the Current Agreements would not occur.
Under the Investment Company Act, a fund cannot enter into a new advisory
agreement and an advisor cannot enter into a new advisory agreement, including
any sub-advisory or portfolio management agreement, on behalf of a fund unless
the shareholders of that fund vote to approve the new advisory agreement. The
Meeting is being held to seek shareholder approval of the New Advisory Agreement
for each Fund, the New Sub-Advisory Agreement for each Sub-Advised Fund and the
New Portfolio Management Agreement(s) for each Portfolio Managed Fund. NO CHANGE
IN ADVISORY, SUB-ADVISORY OR PORTFOLIO MANAGEMENT FEE RATES OR SERVICES IS BEING
PROPOSED.
Shareholders of each Fund will vote separately on the New Advisory Agreement for
that Fund, shareholders of each Sub-Advised Fund will vote separately on the New
Sub-Advisory Agreement for that Fund, and
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shareholders of each Portfolio Managed Fund will vote separately on the New
Portfolio Management Agreement(s) for that Fund. Each share is entitled to cast
one vote, and fractional shares are entitled to a proportionate fractional vote.
All shares are owned of record by sub-accounts of separate accounts ("Separate
Accounts") of life insurance companies (the "Participating Insurance Companies")
established to fund benefits under variable annuity contracts and variable life
insurance policies issued by the Participating Insurance Companies. As of the
Record Date for this Proxy Statement, the Participating Insurance Companies are
Keyport Life Insurance Company ("Keyport"), Independence Life & Annuity Company
(a wholly owned subsidiary of Keyport), Keyport Benefit Life Insurance Company
(a wholly owned subsidiary of Keyport), Liberty Life Assurance Company (an
affiliate of Keyport), MetLife Investors, Security Benefit Life Insurance
Company, Lincoln Life, Great West Life and Annuity Insurance Company, Aegon USA,
Transamerica Life Insurance and SAGE Life Assurance Company. As of the date of
this Proxy Statement, Keyport, Independence Life & Annuity Company, Keyport
Benefit Life Insurance Company and Liberty Life Assurance Company are affiliated
with the Advisors.
The Participating Insurance Companies are mailing copies of this proxy material
to the holders of these contracts and policies who, by completing and signing
the accompanying proxy cards, will instruct the Separate Accounts how they wish
the shares of the Funds to be voted. The Separate Accounts will vote shares of
the Funds as instructed on the proxy cards by their contract or policyholders.
If no instructions are specified on a proxy returned by a contract or policy
holder, the Separate Accounts will vote the shares of the Fund represented
thereby in favor of each New Advisory Agreement, New Sub-Advisory Agreement and
New Portfolio Management Agreement, as applicable. The Separate Accounts intend
to vote shares for which no proxies are returned in the same proportion as the
shares for which proxies are returned. In addition, Keyport, which owns shares
of certain Funds in its general account, intends to vote such shares in the same
proportion as the shares held in its Separate Accounts for which proxies are
returned.
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THE BOARDS OF TRUSTEES RECOMMEND THAT THE SHAREHOLDERS OF EACH FUND VOTE TO
APPROVE THE NEW ADVISORY AGREEMENT, THE NEW SUB-ADVISORY AGREEMENT AND THE NEW
PORTFOLIO MANAGEMENT AGREEMENT(S), AS APPLICABLE, FOR THEIR FUND.
REQUIRED VOTE. For each Fund, the vote required to approve each New Advisory
Agreement, New Sub-Advisory Agreement and New Portfolio Management Agreement, as
applicable, is the lesser of (1) 67% of the shares of that Fund that are present
at the Meeting, if the holders of more than 50% of the shares of the Fund
outstanding as of the record date are present or represented by proxy at the
Meeting, or (2) more than 50% of the shares of the Fund outstanding on the
record date. If the required vote is not obtained for any Fund, the Trustees
will consider what other actions to take in the best interests of the Funds.
DESCRIPTION OF THE NEW ADVISORY AGREEMENTS
The New Advisory Agreement for each Fund is substantially identical (but for a
few non-material changes) to the Current Advisory Agreement for that Fund. The
date of each New Advisory Agreement will be the date that Fleet acquires the
Asset Management Segment, or such later date on which shareholders of the Fund
approve the New Advisory Agreement, and the initial term of each new Advisory
Agreement expires on July 31, 2003. Appendix A1 to this Proxy Statement sets
forth information about the Current Advisory Agreements, including the dates of
the Current Advisory Agreements and the advisory fee rates under both the New
Advisory Agreements and the Current Advisory Agreements. Appendix B1 to this
Proxy Statement contains the form of the New Advisory Agreement applicable to
each Fund. Each Current Advisory Agreement and each New Advisory Agreement
matches the applicable form in Appendix B1, except for items specific to a Fund
such as the Fund's name and fee rate, and the date of the Agreement. The next
several paragraphs briefly summarize some important provisions of the New
Advisory Agreements, but for a complete understanding of the Agreements, you
should read Appendices A1 and B1.
Each New Advisory Agreement essentially provides that the Advisor, under the
Trustees' supervision, will: (1) provide investment management and related
services to the Trust and the Fund, and (2) provide certain administrative and
limited oversight services.
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The New Advisory Agreement for each Fund provides that it will continue in
effect for an initial period beginning on the date Fleet acquires the Asset
Management Segment, or such later date on which shareholders of the Fund approve
the New Advisory Agreements, and ending on July 31, 2003. After that, it will
continue in effect from year to year as long as the continuation is approved at
least annually (i) by the Trustees or by vote of a majority of the outstanding
voting securities of the Fund, and (ii) by vote of a majority of the Trustees
who are not "interested persons," as that term is defined in the Investment
Company Act, of the Trust or the Advisor (those Trustees who are not "interested
persons" of the Trust, or an Advisor, Sub-Advisor or Portfolio Manager for that
Trust, are referred to below as the "Independent Trustees").
The New Advisory Agreement for each Fund may be terminated without penalty by
vote of the Trustees or by vote of a majority of the outstanding voting
securities of the Fund, on sixty days' written notice to an Advisor, or by an
Advisor upon sixty days' written notice to the Trust, and each terminates
automatically in the event of its "assignment" as defined in the Investment
Company Act. The Investment Company Act defines "assignment" to include, in
general, transactions in which a significant change in the ownership of an
investment advisor (including a sub-advisor) or its parent company occurs (such
as the acquisition of the Asset Management Segment by Fleet).
The New Advisory Agreement for each Fund provides that the Advisor will not be
liable to the Fund or its shareholders, except for liability arising from the
Advisor's willful misfeasance, bad faith, gross negligence or reckless disregard
of duty.
Stein Roe & Farnham Incorporated ("Stein Roe") currently provides administrative
services to each of the SRVIT Funds under a separate administration agreement.
This agreement and the agreements discussed in the following paragraphs are not
subject to the "assignment" provisions of the Investment Company Act and are not
impacted by Liberty Financial's sale of the Asset Management Segment to Fleet.
The aggregate administrative services fees paid by each SRVIT Fund to Stein Roe
for the most recently completed fiscal year are set forth in Appendix E. Under
the existing administrative agreement, Stein Roe may make use of its affiliated
companies in connection with the administrative services to be provided to a
Fund under the contract. Whether or not the proposed New Advisory Agreements are
approved,
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the administration agreement for each SRVIT Fund will remain in effect.
Pursuant to pricing and bookkeeping agreements, Colonial Management Associates,
Inc. ("Colonial") and Stein Roe are responsible for providing certain services
to the LVIT Funds and SRVIT Funds, respectively. The aggregate pricing and
bookkeeping fees paid by each Fund to Colonial or Stein Roe for the most
recently completed fiscal year are set forth in Appendix E. Whether or not the
proposed New Advisory Agreements are approved, the pricing and bookkeeping
agreement for each Fund will remain in effect.
Liberty Funds Services, Inc. ("LFSI"), One Financial Center, Boston,
Massachusetts 02111, is the agent for each Fund for the transfer of shares,
disbursement of dividends, and maintenance of shareholder accounting records.
The aggregate transfer agency fees paid by each Fund to LFSI for the most
recently completed fiscal year are set forth in Appendix E. Whether or not the
proposed New Advisory Agreements are approved, the transfer agency agreements
for each Fund will remain in effect.
DESCRIPTION OF THE NEW SUB-ADVISORY AGREEMENTS
The New Sub-Advisory Agreements for the Sub-Advised Funds are substantially
identical (but for a few non-material changes) to the Current Sub-Advisory
Agreements for those Funds. The date of each New Sub-Advisory Agreement will be
the date that Fleet acquires the Asset Management Segment, or such later date on
which the shareholders of the Fund approve the New Sub-Advisory Agreement, and
the initial term of each New Sub-Advisory Agreement expires on July 31, 2003.
Appendix A2 to this proxy statement sets forth information about the Current
Sub-Advisory Agreements, including the dates of the Current Sub-Advisory
Agreements and the advisory fee rates under both the New Sub-Advisory Agreements
and the Current Sub-Advisory Agreements. Appendix B2 to this proxy statement
contains forms of the Sub-Advisory Agreements. Each Current Sub-Advisory
Agreement and each New Sub-Advisory Agreement matches the applicable form in
Appendix B2, except for the changes noted above and items specific to a Fund,
such as the Fund's name and fee rate. The next several paragraphs briefly
summarize some important provisions of the New Sub-Advisory Agreements, but for
a complete understanding of the Agreements, you should read Appendices A2 and
B2.
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The New Sub-Advisory Agreements essentially provide that the Sub-Advisor, under
the Trustees' and the Advisor's supervision, will (1) decide what securities to
buy and sell for the Fund's (or a portion of the Fund's) portfolio (except in
the case of each Portfolio Managed Fund); (2) select brokers and dealers to
carry out portfolio transactions for the Fund (or the portion of the Fund's
portfolio managed by the Sub-Advisor) (except in the case of each Portfolio
Managed Fund); (3) report results to the Board of Trustees of the Trust or the
Advisor, as appropriate; and (4) in the case of certain Portfolio Managed Funds,
to provide an overall investment program and strategy and recommend and oversee
portfolio managers.
The New Sub-Advisory Agreements provide that they will continue in effect for an
initial period beginning on the date Fleet acquires the Asset Management
Segment, or such later date on which the shareholders of the Funds approve the
New Sub-Advisory Agreements, and ending on July 31, 2003. After that, they will
continue in effect from year to year as long as the continuation is approved at
least annually (i) by the Trustees or by vote of a majority of the outstanding
voting securities of the relevant Fund, and (ii) by vote of a majority of the
Independent Trustees.
The New Sub-Advisory Agreements may be terminated without penalty (i) by vote of
the Trustees or by vote of a majority of the outstanding voting securities of
the relevant Fund on sixty days' written notice to the Sub-Advisor, (ii) in some
cases, by the Advisor upon sixty days' written notice to the Sub-Advisor, or
(iii) by the Sub-Advisor upon ninety (in some cases sixty) days' written notice
to the Advisor and the Trust, and the New Sub-Advisory Agreements terminate
automatically in the event of their "assignment," as described above, or upon
termination of the Advisory Agreement.
The Sub-Advisor will not be liable to the Advisor, the relevant Trust, the
relevant Fund or its shareholders, except for liability arising from the
Sub-Advisor's willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations or duties under the New Sub-Advisory Agreement.
DESCRIPTION OF THE NEW PORTFOLIO MANAGEMENT AGREEMENTS
The New Portfolio Management Agreements for the Portfolio Managed Funds are
identical (but for a few non-material changes) to the Current
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Portfolio Management Agreements for those Funds except that the date of each New
Portfolio Management Agreement will be the date that Fleet acquires the Asset
Management Segment, or such later date on which the shareholders of the Fund
approve the New Portfolio Management Agreement, and the initial term of each New
Portfolio Management Agreement expires on July 31, 2003. Appendix A3 to this
proxy statement sets forth information about the Current Portfolio Management
Agreements, including the dates of the Current Portfolio Management Agreements
and the advisory fee rates under both the New Portfolio Management Agreements
and the Current Portfolio Management Agreements. Appendix B3 to this proxy
statement contains the form of the Portfolio Management Agreements. Each Current
Portfolio Management Agreement and each New Portfolio Management Agreement
matches the form in Appendix B3, except for the changes noted above and items
specific to a Fund, such as the Fund's name and fee rate. The next several
paragraphs briefly summarize some important provisions of the New Portfolio
Management Agreements, but for a complete understanding of the Agreements, you
should read Appendices A3 and B3.
The New Portfolio Management Agreements essentially provide that the Portfolio
Manager, under the Trustees', the Advisor's and the Sub-Advisor's supervision,
will (1) decide what securities to buy and sell for the Fund's (or a portion of
the Fund's) portfolio; (2) select brokers and dealers to carry out portfolio
transactions for the Fund (or the portion of the Fund's portfolio managed by the
Portfolio Manager); and (3) report results to the Boards of Trustees of the
Trust, the Advisor or the Sub-Advisor, as appropriate.
The New Portfolio Management Agreements provide that they will continue in
effect for an initial period beginning on the date Fleet acquires the Asset
Management Segment, or such later date on which the shareholders of the
applicable Fund approve the New Portfolio Management Agreement, and ending on
July 31, 2003. After that, they will continue in effect from year to year as
long as the continuation is approved at least annually (i) by the Trustees or by
vote of a majority of the outstanding voting securities of the relevant Fund,
and (ii) by vote of a majority of the Independent Trustees.
The New Portfolio Management Agreements may be terminated without penalty (i) by
vote of the Trustees or by vote of a majority of the outstanding voting
securities of the relevant Fund, on thirty days' written
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notice to the Portfolio Manager, (ii) by the Sub-Advisor upon thirty days'
written notice to the Portfolio Manager, or (iii) by the Portfolio Manager upon
ninety days' written notice to the Sub-Advisor and the Trust, and the New
Portfolio Management Agreements terminate automatically in the event of their
"assignment," as described above, or upon termination of the applicable Advisory
Agreement or Sub-Advisory Agreement.
The Portfolio Manager will not be liable to the Advisor, Sub-Advisor, the
relevant Trust, the relevant Fund or its shareholders, except for liability
arising from the Portfolio Manager's willful misfeasance, bad faith, gross
negligence or reckless disregard in the performance of its obligations or duties
under the New Portfolio Management Agreement.
BASIS FOR THE TRUSTEES' RECOMMENDATIONS
The Trustees initially met on June 11, 2001 to discuss the proposed acquisition
of the Asset Management Segment by Fleet. At that meeting, representatives of
Liberty Financial made a presentation regarding the terms of the proposed
acquisition and representatives of Fleet made a presentation regarding Fleet's
structure and asset management business and their plans as they existed at that
time for the Asset Management Segment. At a meeting held on June 19, 2001,
Liberty Financial and Fleet provided the Trustees with additional information
that they had requested, and the Trustees also completed their annual review of
the contracts for each Fund. The Trustees determined at the June 19, 2001
meeting to recommend that each Fund's shareholders vote to approve the New
Advisory Agreement and, as applicable, the New Sub-Advisory Agreement and the
New Portfolio Management Agreement(s) for their Fund. At a meeting held on July
23, 2001, the Trustees gave further consideration to the proposed acquisition
and reaffirmed their recommendation that shareholders vote to approve the New
Agreements.
In coming to that determination, the Trustees gave particular consideration to
matters relating to the possible effects on the Advisors, the affiliated
Sub-Advisors and the Funds of the acquisition of the Asset Management Segment by
Fleet. Among other things, the Trustees considered:
- - the stated intention of Fleet not to make immediate changes to the investment
management services provided by the Advisors and to
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collaborate with the Advisors, in consultation with the Boards of the Funds,
to develop and implement a strategy for integrating the investment management
businesses of the Advisors with Fleet's investment management business;
- - certain actions taken by Liberty Financial and the Advisors and the affiliated
Sub-Advisors to help retain and incent their key personnel;
- - the general reputation and the financial resources of Fleet and its parent
organization;
- - the potential benefits of scale from combining the asset management businesses
of Fleet and Liberty Financial, including the ability to attract and retain
key personnel and enhance technology and customer service;
- - the expected additional investment options available to shareholders of the
Funds;
- - the impact of the acquisition of the Asset Management Segment on the different
types of investors in the Funds;
- - the stated intention of Fleet to consult with the Boards of the Funds prior to
removing or reducing any voluntary fee waivers or expense limitations; and
- - the stated intention of Fleet of providing investment professionals of the
Advisors with access to greater resources as a result of the acquisition.
In addition, the Trustees considered a wide range of information of the type
they regularly consider when determining whether to continue a Fund's advisory
agreement as in effect from year to year. The Trustees considered information
about, among other things:
- - the Advisors and Sub-Advisors and their respective personnel (including
particularly those personnel with responsibilities for providing services to
the Funds), resources and investment process;
- - the terms of the New Advisory Agreements and, where applicable, the New
Sub-Advisory Agreements and the New Portfolio Management Agreements;
- - the scope and quality of the services that the Advisors, Sub-Advisors and
Portfolio Managers have been providing to the Funds;
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- - the investment performance of each Fund and of similar funds managed by other
advisors;
- - the advisory fee rates payable to the Advisors by the Funds, by the Advisors
to the Sub-Advisors with respect to the Sub-Advised Funds and by the
Sub-Advisors to the Portfolio Managers with respect to the Portfolio Managed
Funds, and by other funds and client accounts managed by the Advisors, the
Sub-Advisors and the Portfolio Managers, and payable by similar funds managed
by other advisors (Appendix C to this Proxy Statement contains information
comparing each Fund's advisory fee schedule to the fee schedule for other
funds managed by the Advisors and, where applicable, one or more Sub-Advisors
and Portfolio Managers, that have investment objectives similar to the
particular Fund);
- - the total expense ratios of the Funds and of similar funds managed by other
advisors; and
- - compensation payable by the Funds to affiliates of the Advisors, the
Sub-Advisors and the Portfolio Managers for other services (see Appendix E to
this Proxy Statement for more information about that compensation).
In addition, the Trustees considered that the agreement relating to the
acquisition by Fleet provides that Fleet will (subject to certain
qualifications) use all reasonable efforts to assure compliance with Section
15(f) of the Investment Company Act. Section 15(f) provides that a mutual fund
investment advisor or its affiliates may receive benefits or compensation in
connection with a change of control of the investment advisor (such as Fleet's
acquisition of the Asset Management Segment) if two conditions are satisfied.
First, for three years after the change of control, at least 75% of the members
of the board of any registered investment company advised by the advisor must
consist of persons who are not "interested persons," as defined in the
Investment Company Act, of the advisor. (No changes in the current composition
of the Trustees are required to satisfy that condition.) Second, no "unfair
burden" may be imposed on any such registered investment company as a result of
the change of control transaction or any express or implied terms, conditions or
understandings applicable to the transaction. "Unfair burden" means any
arrangement, during the two years after the transaction, by which the investment
advisor or any "interested person" of the advisor receives or is entitled to
receive any compensation, directly
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or indirectly, from such investment company or its security holders (other than
fees for bona fide investment advisory or other services) or from any other
person in connection with the purchase or sale of securities or other property
to, from or on behalf of such investment company.
After carefully considering the information described above, the Trustees,
including the Independent Trustees, unanimously voted to approve the New
Advisory Agreement for each Fund, the New Sub-Advisory Agreements for the
Sub-Advised Funds and the New Portfolio Management Agreement(s) for the
Portfolio Managed Funds and to recommend that each Fund's shareholders vote to
approve the New Advisory Agreement and, as applicable, the New Sub-Advisory
Agreement and the New Portfolio Management Agreement(s) for their Fund.
In the event that the shareholders have not approved the New Advisory
Agreements, New Sub-Advisory Agreements or New Portfolio Management Agreements,
as applicable, by the time of the acquisition of the Asset Management Segment by
Fleet, the Advisors, Sub-Advisors and Portfolio Managers will enter into interim
advisory agreements, sub-advisory agreements or portfolio management agreements
pursuant to Rule 15a-4 under the Investment Company Act, which will take effect
immediately following the acquisition of the Asset Management Segment by Fleet
(at which time the Current Agreements will terminate due to an assignment). Each
interim advisory agreement, sub-advisory agreement and portfolio management
agreement will be in substantially the applicable form set forth in Appendix B1,
B2 or B3 but also will include certain provisions required by Rule 15a-4 (such
as a maximum term of 150 days, a provision that a Fund's Board of Trustees or a
majority of the Fund's shareholders may terminate the agreement at any time
without penalty on not more than 10 days' written notice, and a provision that
the compensation earned by the Advisor, Sub-Advisor or Portfolio Manager
thereunder will be held in an interest-bearing escrow account until shareholder
approval of the corresponding New Agreement is obtained, after which the amount
in the escrow account (together with any interest) will be paid to the Advisor,
Sub-Advisor or Portfolio Manager). If a Fund has not received the requisite
shareholder approval for a New Advisory Agreement, New Sub-Advisory Agreement or
New Portfolio Management Agreement(s) within 150 days after the closing of the
acquisition, the Trustees will consider other appropriate arrangements subject
to approval in accordance with the Investment Company Act.
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INFORMATION ABOUT THE ADVISORS, THE SUB-ADVISORS, THE PORTFOLIO MANAGERS AND THE
FLEET/LIBERTY FINANCIAL TRANSACTION
ADVISORS
LIBERTY ADVISORY SERVICES CORP.
Liberty Advisory Services Corp. ("LASC"), a Massachusetts corporation, located
at 125 High Street, Boston, Massachusetts 02110, serves as Manager pursuant to
investment advisory agreements between Liberty Variable Investment Trust on
behalf of the LVIT Funds and LASC. As of May 31, 2001, LASC managed over $871
million in assets. LASC currently serves as investment advisor for 17 open-end
management investment company portfolios. LASC is a direct wholly owned
subsidiary of Keyport, which is an indirect wholly owned subsidiary of Liberty
Financial. Liberty Financial is a direct majority-owned subsidiary of LFC
Management Corporation, which in turn is a direct wholly owned subsidiary of
Liberty Corporate Holdings, Inc., which in turn is a direct wholly owned
subsidiary of LFC Holdings, Inc., which in turn is a direct wholly owned
subsidiary of Liberty Mutual Equity Corporation, which in turn is a direct
wholly owned subsidiary of Liberty Mutual. As of June 30, 2001, LFC Management
Corporation owned 70.46% of the common stock of Liberty Financial and the
balance was held by the public and listed on the New York Stock Exchange.
Liberty Financial is a diversified and integrated asset management organization
which provides insurance and investment products to individuals and
institutions. The principal executive offices of Liberty Financial are located
at 600 Atlantic Avenue, 24th Floor, Boston, Massachusetts 02210. Liberty Mutual
is an underwriter of workers' compensation insurance and a property and casualty
insurer in the United States, organized under the laws of Massachusetts in 1912.
The principal business activities of Liberty Mutual's subsidiaries other than
Liberty Financial are property-casualty insurance, insurance services and life
insurance (including group life and health insurance products) marketed through
its own sales force. The principal executive offices of LFC Management
Corporation, Liberty Corporate Holdings, Inc., LFC Holdings, Inc., Liberty
Mutual and Liberty Mutual Equity Corporation are located at 175 Berkeley Street,
Boston, Massachusetts 02117. Prior to the closing of the Annuity Sale, LASC will
become a wholly owned subsidiary of Liberty Funds Group LLC ("LFG") and will be
acquired by Fleet as part of the Asset Management Segment. Upon completion of
the Annuity Sale, ownership of Keyport will be transferred to Sun Life Assurance
Company.
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The directors and principal executive officer of LASC are Philip K. Polkinghorn
(principal executive officer and director) and Stewart R. Morrison. Mr.
Polkinghorn is the President of Keyport. Mr. Morrison is a Senior Vice President
and the Chief Investment Officer of Keyport. The business address of Messrs.
Polkinghorn and Morrison is 125 High Street, Boston, Massachusetts 02110.
LASC and the Liberty Variable Investment Trust, on behalf of each of the
Colonial Global Equity Fund, Variable Series, Colonial High Yield Securities
Fund, Variable Series, Colonial International Fund for Growth, Variable Series,
Colonial International Horizons Fund, Variable Series, Colonial Small Cap Value
Fund, Variable Series, Colonial Strategic Income Fund, Variable Series, Colonial
U.S. Growth & Income Fund, Variable Series, Liberty S&P 500 Index Fund, Variable
Series, Liberty Select Value Fund, Variable Series, Liberty Value Fund, Variable
Series, Rydex Financial Services Fund, Variable Series and Rydex Health Care
Fund, Variable Series, have entered into separate Sub-Advisory Agreements with
Colonial.
LASC and the Liberty Variable Investment Trust, on behalf of the Stein Roe
Global Utilities Fund, Variable Series, have entered into a separate
Sub-Advisory Agreement with Stein Roe.
LASC and the Liberty Variable Investment Trust, on behalf of each of the Liberty
Newport Japan Opportunities Fund, Variable Series and Newport Tiger Fund,
Variable Series, have entered into separate Sub-Advisory Agreements with Newport
Fund Management, Inc. ("Newport").
LASC and the Liberty Variable Investment Trust, on behalf of the Crabbe Huson
Real Estate Investment Fund, Variable Series, have entered into a separate
Sub-Advisory Agreement with Crabbe Huson Group, Inc. ("Crabbe Huson").
Liberty Asset Management Company ("LAMCO") sub-advises the Liberty All-Star
Equity Fund, Variable Series pursuant to the LASC Management Agreement for such
Fund (to which LAMCO is a party).
The Liberty All-Star Equity Fund, Variable Series' investment program is based
upon LAMCO's multi-manager concept. LAMCO allocates the Fund's portfolio assets
on an equal basis among a number -- currently five -- of independent investment
management organizations ("Portfolio Managers"), each of which employs a
different investment style, and
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periodically rebalances the Fund's portfolio among the Portfolio Managers so as
to maintain an approximately equal allocation of the portfolio among them
throughout all market cycles. Each Portfolio Manager provides these services
under a Current Portfolio Management Agreement among the Trust, on behalf of the
Liberty All-Star Equity Fund, Variable Series, LAMCO and such Portfolio Manager.
STEIN ROE & FARNHAM INCORPORATED
Stein Roe, a Delaware corporation, located at One South Wacker Drive, Chicago,
Illinois 60606, and its predecessor have been providing investment advisory
services since 1932. Stein Roe serves as investment advisor pursuant to
investment advisory agreements between the SteinRoe Variable Investment Trust on
behalf of the SRVIT Funds and Stein Roe. Stein Roe acts as an investment advisor
to trustees, investment companies, pension and profit sharing plans, charitable
organizations, and other institutional investors. As of May 31, 2001, Stein Roe
managed over $23 billion in assets. Stein Roe currently serves as investment
advisor or sub-advisor for 38 open-end and 3 closed-end management investment
company portfolios. Stein Roe is a wholly owned subsidiary of LFG, which in turn
is an indirect wholly owned subsidiary of Liberty Financial.
The directors and principal executive officer of Stein Roe are Stephen E. Gibson
(principal executive officer and director), J. Andrew Hilbert, C. Allen Merritt,
Jr. and Joseph R. Palombo. Mr. Gibson is the President of Stein Roe. Mr. Palombo
is an Executive Vice President of Stein Roe. Mr. Hilbert is the Chief Financial
Officer of Liberty Financial. Mr. Merritt is the Chief of Staff of Liberty
Financial. The business address of Messrs. Gibson and Palombo is One Financial
Center, Boston, Massachusetts 02111; and that of Messrs. Hilbert and Merritt is
600 Atlantic Avenue, 24th Floor, Boston, Massachusetts 02210.
In addition, the following individuals who are officers of the Trusts are also
officers of Stein Roe: William J. Ballou, Kevin M. Carome and Kevin S. Jacobs.
Stein Roe and the SteinRoe Variable Investment Trust, on behalf of Stein Roe
Balanced Fund, Variable Series, have entered into a separate Sub-Advisory
Agreement with Nordea Securities, Inc.
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SUB-ADVISORS
COLONIAL MANAGEMENT ASSOCIATES, INC.
Colonial, a Massachusetts corporation, located at One Financial Center, Boston,
Massachusetts 02111, is a wholly owned subsidiary of LFG, also located at One
Financial Center, Boston, Massachusetts 02111, which in turn is a direct wholly
owned subsidiary of Liberty Financial Services, Inc. ("LFS") which is a direct
wholly owned subsidiary of Liberty Financial. The principal executive offices of
LFS are located at 600 Atlantic Avenue, 24th Floor, Boston, Massachusetts 02110.
Colonial and/or its affiliate, Colonial Advisory Services, Inc., has rendered
investment advisory services to investment company, institutional and other
clients since 1931. As of May 31, 2001, Colonial managed and/or administered
over $17 billion in assets. Colonial currently serves as investment advisor,
sub-advisor or administrator for 48 open-end and 9 closed-end management
investment company portfolios.
The directors of Colonial are Stephen E. Gibson, Joseph R. Palombo and Kevin M.
Carome. Mr. Gibson is the President and Chief Executive Officer of Colonial. Mr.
Palombo is an Executive Vice President of Colonial. Mr. Carome is a Senior Vice
President of Colonial. The business address of Messrs. Gibson and Palombo is One
Financial Center, Boston, Massachusetts 02111. The business address of Mr.
Carome is 600 Atlantic Avenue, 24th Floor, Boston, Massachusetts 02210.
In addition, the following individuals who are officers of the Trusts are also
officers of Colonial: William J. Ballou, Barry Finkle, Ellen Harrington, Kevin
S. Jacobs, Russell L. Kane and Vincent P. Pietropaolo.
STEIN ROE & FARNHAM INCORPORATED
Stein Roe serves as the sub-advisor to Stein Roe Global Utilities Fund, Variable
Series. See above for a description of Stein Roe and its directors and principal
executive officer.
NEWPORT FUND MANAGEMENT, INC.
Newport, a Virginia corporation, located at 580 California Street, San
Francisco, California 94104, serves as an investment advisor and sub-advisor to
investment companies. As of May 31, 2001, Newport managed
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over $912 million in assets. Newport currently serves as investment advisor or
sub-advisor for 9 open-end management investment company portfolios. Newport is
a direct majority-owned subsidiary of Newport Pacific Management, Inc. ("Newport
Pacific"), a California corporation, also located at 580 California Street, San
Francisco, California 94104. Newport Pacific is a direct wholly owned subsidiary
of Liberty Newport Holdings, Limited, which in turn is a direct wholly owned
subsidiary of Liberty Financial.
The directors of Newport and Newport Pacific are Lindsay Cook, J. Andrew Hilbert
and John M. Mussey. Mr. Cook is an Executive Vice President of Liberty
Financial. Mr. Hilbert is the Chief Financial Officer of Liberty Financial. Mr.
Mussey is the Chairman of Newport and Newport Pacific. The business address of
Messrs. Cook and Hilbert is 600 Atlantic Avenue, 24th Floor, Boston,
Massachusetts 02210; and that of Mr. Mussey is 580 California Street, San
Francisco, California 94104.
LIBERTY ASSET MANAGEMENT COMPANY
LAMCO, a Delaware corporation, located at 600 Atlantic Avenue, 24th Floor,
Boston, Massachusetts 02210, is a direct wholly owned subsidiary of LFS, which
is a direct wholly owned subsidiary of Liberty Financial. As of May 31, 2001,
LAMCO managed over $1.4 billion in assets. LAMCO currently serves as investment
advisor for one open-end and two closed-end management investment company
portfolios.
The directors of LAMCO are Lindsay Cook, J. Andrew Hilbert and William R.
Parmentier, Jr. Mr. Cook is an Executive Vice President of Liberty Financial.
Mr. Hilbert is the Chief Financial Officer of Liberty Financial. Mr. Parmentier
is the President, Chief Executive Officer and Chief Investment Officer of LAMCO.
The business address of Messrs. Cook, Hilbert and Parmentier is 600 Atlantic
Avenue, 24th Floor, Boston, Massachusetts 02210.
CRABBE HUSON GROUP, INC.
Crabbe Huson, a Massachusetts corporation, located at 121 S.W. Morrison,
Portland, Oregon 97204, has rendered investment advisory services to investment
company, institutional or other clients since 1980. As of May 31, 2001, Crabbe
Huson managed over $1.56 billion in assets.
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Crabbe Huson currently serves as investment advisor for 5 open-end management
investment company portfolios. Crabbe Huson is a direct, wholly owned subsidiary
of Liberty Financial.
The directors of Crabbe Huson are Lindsay Cook and J. Andrew Hilbert. Mr. Cook
is an Executive Vice President of Liberty Financial and the President of Crabbe
Huson. Mr. Hilbert is a Senior Vice President and the Chief Financial Officer of
Liberty Financial. The business address of Messrs. Cook and Hilbert is 600
Atlantic Avenue, 24th Floor, Boston, Massachusetts 02210.
NORDEA SECURITIES, INC.
Nordea Securities, Inc., d/b/a Nordea Investment Management ("Nordea") in the
United States, is located at 13-15 West 54th Street, New York, New York 10019.
Nordea offers a range of equity investment products and services to
institutional clients, including private and public retirement funds, unions,
endowments, foundations and insurance companies, as well as to mutual fund
sponsors on a sub-advisory basis. As of May 31, 2001, Nordea managed over $32
billion in assets. Nordea is an indirect wholly owned subsidiary of Unibank A/S,
which in turn is a direct wholly owned subsidiary of Nordea Companies Denmark,
which in turn is a direct wholly owned subsidiary of Nordea AB. The principal
executive offices of Unibank A/S are located at Torvegade 2 DK-1786 Copenhagen
V., Denmark. The principal executive offices of Nordea Companies Denmark are
located at Strandgrade 3 DK-1786 Copenhagen V., Denmark. The principal executive
offices of Nordea AB are located at Hamngatan 10, SE-105 71 Stockholm, Sweden.
The directors of Nordea Securities, Inc. are Henrik Bak, Ole Jacobsen, Jerry
Murphy, Peter Nyegaard and Finn Pedersen. Mr. Bak is the President and Chairman
of the Board of Nordea Securities, Inc. Mr. Jacobsen is a Managing Director and
the Head of Nordea Investment Management. Mr. Murphy is the Head of
Administration, Nordea AB, New York. Mr. Nyegaard is the Head of Markets, Nordea
AB. Mr. Pedersen is the Head of Equities, Aros Maizel. The business address of
Messrs. Bak and Murphy is 13-15 West 54th Street, New York, New York, 10019. The
business address of Messrs. Nyegaard and Jacobsen is Torvegade 2 DK-1786
Copenhagen V., Denmark. The business address of Mr. Pedersen is Engelbrektsplan,
Fill, 4 98 Stockholm, Sweden.
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PORTFOLIO MANAGERS
Information about Liberty All-Star Equity Fund, Variable Series' current
Portfolio Managers is set forth below.
MASTRAPASQUA & ASSOCIATES, INC. Mastrapasqua & Associates, Inc.
("Mastrapasqua"), an investment advisor since 1993, is located at 814 Church
Street, Suite 600, Nashville, Tennessee 37203 and is an independently owned
firm. Ownership of Mastrapasqua lies 100% with its officers and trustees.
Mastrapasqua's principal executive officer is Frank Mastrapasqua, Ph.D.,
Chairman and Chief Executive Officer. Mr. Mastrapasqua, Thomas A. Trantum,
President, and Mauro Mastrapasqua, First Vice President, may be deemed to be
control persons of Mastrapasqua by virtue of their aggregate ownership of more
than 25% of the outstanding voting stock of Mastrapasqua. As of May 31, 2001,
Mastrapasqua managed approximately $2.3 billion in assets.
OPPENHEIMER CAPITAL. Oppenheimer Capital ("Oppenheimer"), an investment advisor
since 1969, is located at 1345 Avenue of the Americas, New York, New York 10105.
Oppenheimer is a Delaware partnership and an indirect subsidiary of Allianz A.G.
Oppenheimer's principal executive officer is Kenneth M. Poovey. As of March 31,
2001, Oppenheimer managed over $35.7 billion in assets.
BOSTON PARTNERS ASSET MANAGEMENT, L.P. Boston Partners Asset Management, L.P.
("Boston Partners"), an investment advisor since 1995, is located at 28 State
Street, Boston, Massachusetts 02109. The sole General Partner of Boston Partners
is Boston Partners, Inc., a Delaware Subchapter S Corporation. Desmond J.
Heathwood is the President of Boston Partners, Inc. As of May 31, 2001, Boston
Partners managed over $10.9 billion in assets.
WESTWOOD MANAGEMENT CORP. Westwood Management Corp. ("Westwood"), an investment
advisor since 1983, is located at 300 Crescent Court, Dallas, Texas 75201 and is
a wholly owned subsidiary of Southwest Securities Group, Inc. Westwood's
principal executive officer is Susan M. Byrne and its directors are Ms. Byrne,
Brian Casey, Don A. Buchhotz, David Glatstein, and Patricia R. Fraze. As of May
31, 2001, Westwood managed over $3.7 billion in assets.
TCW INVESTMENT MANAGEMENT COMPANY. TCW Investment Management Company ("TCW"),
located at 865 South Figueroa Street, Los Angeles, California 90017, is a wholly
owned subsidiary of The TCW
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Group, Inc. ("TCW Group"). Established in 1971, TCW Group's direct and indirect
subsidiaries, including TCW, provide a variety of trust, investment management
and investment advisory services. Societe Generale Asset Management, S.A.
("SGAM") owns 51% of the TCW Group. SGAM is a wholly owned subsidiary of Societe
Generale, S.A. ("Societe Generale"). SGAM is located at 92078 place de la
Coupole, 92078 Paris, France. Societe Generale is located at 29, boulevard
Haussmann, 75009 Paris, France. The employees and management and other
shareholders of the TCW Group own the remaining 49% of the company. Under the
terms of an agreement between the TCW Group and SGAM, SGAM will acquire an
additional 19% interest in the TCW Group over the course of the next five years.
SGAM and TCW have stated their intention to maintain the personnel, processes,
investment strategy and operations of TCW, which will continue to operate under
the TCW brand name. As of May 31, 2001, TCW and its affiliates had approximately
$75 billion in assets under management or committed to management.
Information about Rydex Financial Services Fund, Variable Series' and Rydex
Health Care Fund, Variable Series' current Portfolio Manager is set forth below.
RYDEX GLOBAL ADVISORS. Rydex Global Advisors ("Rydex"), a Maryland corporation,
located at 9601 Blackwell Road, Suite 500, Rockville, Maryland 20850, has been
an investment advisor since 1993. As of May 31, 2001, Rydex managed over $5.3
billion in assets.
The trustees and principal executive officer of Rydex are Albert P. Viragh, Jr.
(principal executive officer and trustee), Corey A. Colehour, J. Kenneth Dalton,
John O. Demaret, Patrick T. McCarville and Roger Somers. Mr. Viragh owns a
controlling interest in Rydex.
Information about Liberty S&P 500 Index Fund, Variable Series' current Portfolio
Manager is set forth below.
SSGA FUNDS MANAGEMENT, INC. SSgA Funds Management, Inc. ("SSgA FM"), located at
Two International Place, Boston, Massachusetts 02110, is one of the State Street
Corporation ("SSgA") companies which constitute the investment management
business of SSgA. SSgA has been in the business of providing investment advisory
services since 1978. As of March 31, 2001, all of the SSgA companies managed
approximately $720 billion in assets. SSgA FM is a newly formed entity that, as
of May 2001, manages all of the registered investment company
25
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business of SSgA. As of May 31, 2001, SSgA FM had approximately $53 billion in
assets under management.
The directors of SSgA FM are Gustaff V. Fish, Jr., Agustin Fleites, Timothy B.
Harbert and Mitchell H. Shames. Messrs. Fish, Fleites, Harbert and Shames are
considered control persons of SSgA FM.
DESCRIPTION OF THE TRANSACTION
On June 4, 2001, Liberty Financial announced that it had entered into a Stock
Purchase Agreement with Fleet (the "Purchase Agreement"). Under the Purchase
Agreement, Fleet would acquire the Asset Management Segment for a purchase price
of $900 million, plus the assumption of approximately $110 million in debt. This
price may be adjusted:
- - upward or downward based on increases or decreases in the amount of portfolios
managed by the subsidiaries that make up the Asset Management Segment
(excluding the effects of market action) from December 31, 2000 until a date
prior to the closing as the result of purchases of and exchanges into and
withdrawals from and exchanges out of those portfolios. The maximum purchase
price adjustment under this provision would be $180 million;
- - upward or downward based on increases or decreases in the tangible net worth
of the Asset Management Segment from April 1, 2001 through a date prior to the
closing;
- - downward based on decreases of more than 20% (excluding the effects of sales
and redemptions) in the market values of the assets under management of the
Asset Management Segment between March 31, 2001 and a date prior to the
closing; and
- - upward or downward based on the estimated value of amounts owing to or by
Liberty Financial at the time of closing in respect of taxes with respect to
the income of the Asset Management Segment and the settlement of certain
inter-company accounts, agreements and arrangements between Liberty Financial
and the subsidiaries that make up the Asset Management Segment.
The transaction will not occur unless various conditions are satisfied (or
waived by the parties, if permitted by law). One of these conditions is
obtaining approval or consent from investment advisory clients of the Advisors,
the affiliated Sub-Advisors and other Liberty Financial affiliates that
constitute the Asset Management Segment (including fund
26
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clients) whose accounts represent 80% of the Asset Management Segment's assets
under management as of March 31, 2001. Because of these conditions, approval or
disapproval by a Fund's shareholders of a New Advisory Agreement, New
Sub-Advisory Agreement and Portfolio Management Agreement(s), as applicable, for
their Fund, taken together with other clients' consents or approvals, could
affect whether or not the transaction occurs. As described below, certain
officers of the Trusts will receive certain material payments or benefits if the
transaction occurs. The transaction will result in the automatic termination of
the Current Agreements. If for some reason the transaction does not occur, the
automatic termination of the Current Agreements will not occur, and the New
Agreements will not be entered into, even if they have been approved by the
Funds' shareholders.
Simultaneously with the signing of the Purchase Agreement, at Fleet's request,
Liberty Mutual and Liberty Financial entered into a license agreement with Fleet
which provides that upon the closing of the acquisition of the Asset Management
Segment, Fleet will have a perpetual, royalty free, non-transferable,
non-sublicensable, non-exclusive license to use the Liberty mark and trade name,
the Statue of Liberty design and other associated marks and trade names used in
connection with the Asset Management Segment's business. The license agreement
also contains other covenants and provisions more fully set forth in the Fleet
license agreement. Neither Liberty Mutual nor Liberty Financial will receive
compensation or other consideration under the Fleet license agreement.
As a result of the acquisition, the Advisors, the affiliated Sub-Advisors and
certain of their affiliates that constitute the Asset Management Segment would
become wholly owned, direct or indirect subsidiaries of Fleet. Fleet is a wholly
owned subsidiary of FleetBoston Financial Corporation, a Boston,
Massachusetts-based financial holding company. Fleet and its affiliates offer a
comprehensive array of financial solutions to approximately 20 million customers
in more than 20 countries. Their key lines of business include:
- - CONSUMER AND INVESTMENT SERVICES -- includes domestic retail banking to
consumer and small business customers, community banking, student loan
processing, credit card services, and investment services, including mutual
funds and investments, retirement planning, large institutional asset
management and brokerage;
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36
- - CORPORATE AND GLOBAL BANKING -- includes commercial finance, including
asset-based lending and leasing; international banking in key Latin American
markets; corporate banking, including specialized industry and institutional
lending; and middle market lending, including commercial lending, government
banking services, trade services and cash management; and
- - CAPITAL MARKETS -- includes investment banking services, brokerage,
market-making and principal investing.
CERTAIN INTERESTS OF FUND TRUSTEES AND OFFICERS. Substantially all full-time
employees of Liberty Financial and its subsidiaries (including officers of the
Trusts and one officer of certain subsidiaries of Liberty Financial who is also
a Trustee of the Trusts) participate in the Liberty Financial Companies, Inc.
and Subsidiaries Non-Commissioned Employee Severance and Retention Plan or the
Liberty Financial Companies, Inc. and Subsidiaries Commissioned Employees
Severance and Retention Plan (the "Retention Plans"). The Retention Plans
provide for cash retention bonuses and the full vesting upon a change of control
of all outstanding options to purchase shares of stock of Liberty Financial
("Liberty Financial Options") and shares of restricted stock of Liberty
Financial ("Restricted Stock") for which the target price in the applicable
restricted stock agreement is less than the value of Liberty Financial common
stock on the date of the change of control, even though some of these Liberty
Financial Options and Restricted Stock would not otherwise have vested or become
fully exercisable prior to the change of control. The Retention Plans also
provide for enhanced severance benefits to substantially all employees upon a
change of control and additional payments to cover excise tax obligations. With
respect to employees of the subsidiaries that constitute the Asset Management
Segment, a change of control will be deemed to occur under the Retention Plans
upon the completion of the Fleet transaction.
CERTAIN BROKERAGE MATTERS
In their consideration of the New Advisory Agreements, New Sub-Advisory
Agreements and New Portfolio Management Agreements, the Trustees took account of
the Advisors', Sub-Advisors', and Portfolio Managers' practices regarding the
selection and compensation of brokers and dealers that execute portfolio
transactions for the Funds, and the brokers' and dealers' provision of brokerage
and research services to the Advisors, Sub-Advisors and Portfolio Managers. The
Advisors and the
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affiliated Sub-Advisors have informed the Trustees that they do not expect to
change these practices as a result of Fleet's acquisition of the Asset
Management Segment. A summary of these brokerage and soft-dollar practices is
set forth in Appendix D.
The Advisors, Sub-Advisors and/or Portfolio Managers may cause portfolio
transactions for the Funds to be executed by AlphaTrade Inc. ("AlphaTrade"), a
brokerage firm that is affiliated with the Advisors because it is owned by
Colonial, which, like Crabbe Huson, Newport Stein Roe, LAMCO and LASC, is a
wholly owned subsidiary of Liberty Financial and which is part of the Asset
Management Segment. The Funds pay brokerage commissions to AlphaTrade for
executing these portfolio transactions. Appendix E contains information about
these commission payments.
PROPOSAL 4
ELECTION OF TRUSTEES OF LIBERTY VARIABLE
INVESTMENT TRUST
The purpose of this proposal is to elect eleven members to the Board of Trustees
of Liberty Variable Investment Trust. All of the nominees listed below are
currently members of the Board of Trustees, and have served in that capacity
continuously since originally elected or appointed. All of the currently serving
members, other than Ms. Kelly and Messrs. Hacker, Nelson, Palombo and Theobald,
have been previously elected to the Board of Trustees by the shareholders in
October, 1998. Ms. Kelly and Messrs. Hacker, Nelson, Palombo and Theobald
currently serve on the Boards of Trustees of a number of closed-end funds and
open-end trusts in the Liberty Funds Complex and Stein Roe Funds Complex, and
were recommended for election as Trustees of the Trust by the then current Board
of Trustees of the Trust at a special meeting held on October 25-26, 2000. Each
elected Trustee will serve as Trustee until a successor is elected and qualified
or until death, retirement, resignation or removal.
REQUIRED VOTE. A plurality of the votes cast at the Meeting by shareholders of
the Trust, if a quorum is represented, is required for the election of each
Trustee. Since the number of Trustees for the Trust is fixed at eleven, this
means that the eleven persons receiving the highest number of votes will be
elected as Trustees of the Trust.
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FOR INFORMATION REGARDING THE BOARD OF TRUSTEES AND EXECUTIVE OFFICERS OF YOUR
FUND, SEE APPENDICES G AND H TO THIS PROXY STATEMENT.
TRUSTEES' COMPENSATION
The members of the Board of Trustees of each Fund serve as Trustees of the
Liberty Funds Complex and Stein Roe Funds Complex, for which service each
Trustee, except for Mr. Palombo, receives an annual retainer of $45,000, and
attendance fees of $8,000 for each regular joint Board meeting and $1,000 for
each special joint Board meeting. The Board of Trustees holds six regular joint
Board meetings each year. Committee chairs receive an additional annual retainer
of $5,000. Other committee members receive an additional annual retainer of
$1,000, and receive $1,000 for each special meeting attended on a day other than
a regular joint Board meeting day. Two-thirds of the Trustees' fees are
allocated among the Liberty Funds Complex and Stein Roe Funds Complex based on
their relative net assets, and one-third of the fees is divided equally among
the respective Funds in the Liberty Funds Complex and Stein Roe Funds Complex.
The Boards of Trustees of the Liberty Funds Complex and the Stein Roe Funds
Complex were combined in 2000. The Funds do not provide pension or retirement
plan benefits to the Trustees. However, certain Trustees who served on the
Boards of Trustees of the Liberty Funds Complex and did not continue on the
combined Boards of Trustees of the Liberty Funds Complex and Stein Roe Funds
Complex will receive payments at an annual rate equal to their 1999 Trustee
compensation for the lesser of two years or until the date they would otherwise
have retired at age 72. Liberty Financial and the Funds of the Liberty Funds
Complex will each bear one-half of the cost of the payments; the portion of the
payment borne by the Liberty Funds Complex will be allocated among the Liberty
Funds Complex based on each Fund's share of the Trustee fees for 2000. In
addition, two Trustees who served on the Boards of Trustees of the Stein Roe
Funds Complex and did not continue on the combined Boards of Trustees of the
Liberty Funds Complex and Stein Roe Funds Complex have received or will receive
payments in connection with their service. One Trustee received a payment of
$50,000 upon completion of his service and another will receive four quarterly
payments at an annual rate equal to his 1999 Trustee compensation. Liberty
Financial and the Stein Roe Funds
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Complex will each bear one-half of the cost of the payments to these Trustees;
the Stein Roe Funds Complex' portion of the payments will be allocated among the
Funds based on each Fund's share of the Trustee fees for 2000.
FOR INFORMATION REGARDING THE COMPENSATION RECEIVED BY THE TRUSTEES OF YOUR FUND
FOR SERVING AS TRUSTEES FOR THE YEAR ENDED DECEMBER 31, 2000, SEE APPENDIX I TO
THIS PROXY STATEMENT.
TRUSTEES' MEETINGS AND COMMITTEES
The current Boards of the Trusts consist of two Trustees who are "interested
persons" (as that term is defined in the Investment Company Act) and nine
Trustees who are non-interested persons.
AUDIT COMMITTEE. The Audit Committee makes recommendations to the full Board as
to the firm of independent accountants to be selected, reviews the methods,
scope and results of audits and fees charged by such independent accountants,
and reviews the Funds' internal accounting procedures and controls. The Audit
Committee members for the fiscal year ended December 31, 2000 were Ms. Verville
(Chairperson) and Messrs. Bleasdale, Grinnell, Lowry, Macera and Moody, all of
whom were non-interested Trustees. The current Audit Committee members are Ms.
Verville (Chairperson) and Messrs. Hacker, Macera, Nelson and Neuhauser, all of
whom are non-interested Trustees. The Funds currently have no Nominating or
Compensation Committee.
The Funds have an Audit Committee comprised of Trustees who are not interested
persons of the Fund. The Audit Committee reviews the process for preparing and
reviewing financial statements and other audit-related matters as they arise
throughout the year.
GOVERNANCE COMMITTEE. The Governance Committee members for the fiscal year
ended December 31, 2000 were Messrs. Bleasdale (Chairperson), Lowry, Mayer and
Moody and Ms. Verville, all of whom were non-interested Trustees, except for Mr.
Mayer (Mr. Mayer is interested as a result of his affiliation with a
broker-dealer, but is not affiliated with Liberty Financial). The Governance
Committee in its sole discretion, recommends to the Board of Trustees, among
other things, nominees for trustee and for appointments to various committees.
The Governance Committee will consider candidates for trustee recommended by
shareholders. Written recommendations with supporting information should be
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directed to the Governance Committee in care of the applicable Fund, Attention:
Secretary, One Financial Center, 11th Floor, Boston, Massachusetts 02111-2621.
The current Governance Committee members are Messrs. Theobald (Chairperson),
Hacker, Lowry and Mayer and Ms. Verville.
RECORD OF BOARD AND THE COMMITTEE MEETINGS. The Board and Committees held the
following number of meetings during the fiscal year ended December 31, 2000:
<Table>
The Board of Trustees 6
Audit Committee 5
Compensation Committee 1(1)
Nominating Committee 0(1)
Governance Committee 2
</Table>
(1) The Nominating Committee was dissolved in December, 2000. The Governance
Committee assumed the duties of the Compensation Committee in December,
2000.
During the fiscal year ended December 31, 2000, each of the current Trustees,
except for Ms. Kelly and Messrs. Hacker, Nelson, Palombo and Theobald (none of
whom served on the Board of Trustees prior to December 27, 2000), attended more
than 75% of the meetings of the Board and the committees of which such Trustee
was a member.
If any nominee listed above becomes unavailable for election, the enclosed proxy
card may be voted for a substitute nominee in the discretion of the proxy
holder(s).
THE BOARD OF TRUSTEES RECOMMENDS THAT THE SHAREHOLDERS OF EACH FUND VOTE FOR
EACH NOMINEE IN PROPOSAL 4.
OTHER INFORMATION
PRINCIPAL UNDERWRITER'S AND ADMINISTRATORS' ADDRESS. The address of the Funds'
principal underwriter, Liberty Funds Distributor, Inc., is One Financial Center,
Boston, Massachusetts 02111. The address of the LVIT Funds' administrator,
Colonial, is One Financial Center, Boston, Massachusetts 02111. The address of
the SRVIT Funds' administrator, Stein Roe, is One South Wacker Drive, Chicago,
Illinois 60606.
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41
FUND ANNUAL AND SEMI-ANNUAL REPORTS. THE FUNDS HAVE PREVIOUSLY SENT THEIR
ANNUAL REPORTS AND ANY SUBSEQUENT SEMI-ANNUAL REPORTS TO THEIR SHAREHOLDERS. YOU
CAN OBTAIN A COPY OF THESE REPORTS WITHOUT CHARGE BY WRITING TO LIBERTY FUNDS
DISTRIBUTOR, INC., ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS 02111, OR BY
CALLING 800-426-3750 OR BY CALLING OR WRITING THE PARTICIPATING INSURANCE
COMPANY WHICH ISSUED YOUR VARIABLE ANNUITY CONTRACT OR VARIABLE LIFE INSURANCE
POLICY.
OUTSTANDING SHARES AND SIGNIFICANT SHAREHOLDERS. Shareholders of record at the
close of business on July 16, 2001 are entitled to notice of and to vote at the
Meeting and any adjourned session. Appendix F to this Proxy Statement lists for
each Fund the total number of shares outstanding as of July 16, 2001 for each
class of the Fund's shares entitled to vote at the Meeting. It also identifies
holders of more than 5% of any class of shares of each Fund and contains
information about the shareholdings in the Funds by the Trustees and the
executive officers of the Funds. All shares were owned of record by the Separate
Accounts of the Participating Insurance Companies established to fund benefits
under variable annuity contracts and variable life insurance policies issued by
the Participating Insurance Companies. As of the date of this Proxy Statement,
the Participating Insurance Companies are Keyport, Independence Life & Annuity
Company (a wholly owned subsidiary of Keyport), Keyport Benefit Life Insurance
Company (a wholly owned subsidiary of Keyport), Liberty Life Assurance Company
(an affiliate of Keyport), MetLife Investors, Security Benefit Life Insurance
Company, Lincoln Life, Great West Life and Annuity Insurance Company, Aegon USA,
Transamerica Life Insurance and SAGE Life Assurance Company. As of the date of
this Proxy Statement, Keyport, Independence Life & Annuity Company, Keyport
Benefit Life Insurance Company and Liberty Life Assurance Company are affiliated
with the Advisors.
INFORMATION ABOUT PROXIES AND THE CONDUCT OF THE MEETING
SOLICITATION OF PROXIES. Proxies will be solicited primarily by mailing this
Proxy Statement and its enclosures, but proxies may also be solicited through
further mailings or telephone calls, or in person by officers of the Funds or by
employees or agents of the Advisors or of Liberty Financial and its affiliated
companies.
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COSTS OF SOLICITATION. All of the costs of the Meeting will be paid by Liberty
Financial or Fleet. None of these costs will be borne by the Funds or their
shareholders.
VOTING AND TABULATION OF PROXIES. Shares represented by duly executed proxies
will be voted as instructed on the proxy. The Participating Insurance Companies
are mailing copies of this proxy material to the holders of these contracts and
policies who, by completing and signing the accompanying proxy cards, will
instruct the Separate Accounts how they wish the shares of the Funds to be
voted. The Separate Accounts will vote shares of the Funds as instructed on the
proxy cards by their contract or policyholders. If no instructions are specified
on a proxy returned by a contract or policy holder, the Separate Accounts will
vote the shares of the Fund represented thereby in favor of the election of each
person nominated as a Trustee and in favor of each New Advisory Agreement, and
if applicable, New Sub-Advisory Agreement and New Portfolio Management
Agreement. The Separate Accounts intend to vote shares for which no proxies are
returned in the same proportion as the shares for which proxies are received. In
addition, Keyport, which owns shares of certain Funds in its general account,
intends to vote such shares in the same proportion as the shares held in its
Separate Accounts for which proxies are received. You may vote by either of the
following methods: (1) by mailing the enclosed proxy card or (2) in person at
the Meeting. If you mail the enclosed proxy and no choice is indicated for a
proposal listed in the attached Notice of Special Meeting, your proxy will be
voted in favor of that proposal, including all of the nominees for election as
Trustees. At any time before it has been voted, your proxy may be revoked in one
of the following ways: (i) by sending a signed, written letter of revocation to
the Secretary of the Trust, (ii) by properly executing a later-dated proxy (by
any of the methods of voting described above), or (iii) by attending the
Meeting, requesting return of any previously delivered proxy and voting in
person.
Votes cast in person or by proxy at the Meeting will be counted by persons
appointed by the Funds as tellers for the Meeting (the "Tellers"). Thirty
percent (30%) of the shares of any Fund outstanding on the record date, present
in person or represented by proxy, constitute a quorum for the transaction of
business by the shareholders of that Fund at the Meeting. In determining whether
a quorum is present, the Tellers will count shares represented by proxies that
reflect abstentions, and "broker non-votes," as shares that are present and
entitled to vote. With respect to approval of the
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New Advisory Agreements, New Sub-Advisory Agreements and New Portfolio
Management Agreements, these shares, which will be counted as present but not as
voting in favor of any proposal, will have the same effect as if they cast votes
against the proposal. With respect to the election of Trustees, withheld
authority, abstentions and broker non-votes have no effect on the outcome of
voting. "Broker non-votes" are shares held by brokers or nominees as to which
(i) the broker or nominee does not have discretionary voting power and (ii) the
broker or nominee has not received instructions from the beneficial owner or
other person who is entitled to instruct how the shares will be voted.
ADJOURNMENTS; OTHER BUSINESS. If any Fund has not received enough votes by the
time of the Meeting to approve that Fund's New Advisory Agreement, New
Sub-Advisory Agreement and New Portfolio Management Agreement(s), as applicable,
the persons named as proxies may propose that the Meeting be adjourned one or
more times as to that Fund to permit further solicitation of proxies. Any
adjournment requires the affirmative vote of more than 50% of the total number
of shares of that Fund that are present in person or by proxy when the
adjournment is being voted on. The persons named as proxies will vote in favor
of any such adjournment all proxies that they are entitled to vote in favor of
the relevant Fund's New Advisory Agreement, New Sub-Advisory Agreement and New
Portfolio Management Agreement(s), as applicable. They will vote against any
such adjournment any proxy that directs them to vote against the New Advisory
Agreement, New Sub-Advisory Agreement and New Portfolio Management Agreement(s),
as applicable. They will not vote any proxy that directs them to abstain from
voting on the New Advisory Agreement, New Sub-Advisory Agreement and New
Portfolio Management Agreement(s), as applicable.
The Meeting has been called to transact any business that properly comes before
it. The only business that management of the Funds intends to present or knows
that others will present is the approval of the New Advisory Agreements, New
Sub-Advisory Agreements and New Portfolio Management Agreements, as applicable,
and election of Trustees for the LVIT Funds. If any other matters properly come
before the Meeting, and on all matters incidental to the conduct of the Meeting,
the persons named as proxies intend to vote the proxies in accordance with their
judgment, unless the Secretary of the Trusts has previously received written
contrary instructions from the shareholder entitled to vote the shares.
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SHAREHOLDER PROPOSALS AT FUTURE MEETINGS. The Funds do not hold annual or other
regular meetings of shareholders. Shareholder proposals to be presented at any
future meeting of shareholders of the Funds must be received by the Funds in
writing a reasonable time before the Trust begins to print and mail proxies for
that meeting, in order to be considered for inclusion in the proxy materials for
that meeting. You may submit shareholder proposals to the Secretary of the
Trusts, One Financial Center, Boston, Massachusetts 02111-2621.
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APPENDIX A1
ADVISORY AGREEMENTS
LVIT FUNDS
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE ACTION DATE OF LAST
ADVISORY FEE REGARDING CURRENT SUBMISSION OF CURRENT
RATE SCHEDULE DATE OF ADVISORY AGREEMENT ADVISORY AGREEMENT FOR
(ANNUAL RATE CURRENT SINCE BEGINNING SHAREHOLDER APPROVAL
OF THE NET ADVISORY OF FUND'S LAST AND REASON FOR
NAME OF FUND ASSET VALUE) AGREEMENT FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Colonial 0.95% of June 1, 1999 On June 19, 2001, On June 1, 1999, the
Global assets under the Trustees sole shareholder of the
Equity Fund, $1 billion; approved the Fund approved the
Variable 0.90% of continuation of Current Advisory
Series(1) assets over the current Agreement
$1 billion advisory agreement
- ---------------------------------------------------------------------------------------
Colonial 0.60% May 19, 1998 On June 19, 2001, On May 19, 1998, the
High Yield the Trustees sole shareholder of the
Securities approved the Fund approved the
Fund, continuation of Current Advisory
Variable the current Agreement
Series(2) advisory agreement
- ---------------------------------------------------------------------------------------
Colonial 0.90% of May 2, 1994 On June 19, 2001, On February 27, 1995,
International assets under (amended the Trustees shareholders approved
Fund for $1 billion; February 28, approved the an amendment to the
Growth, 0.85% of 1995) continuation of management agreement to
Variable assets over the current allow Liberty Financial
Series $1 billion advisory agreement and its affiliates to
perform certain
administrative duties
for the Fund
- ---------------------------------------------------------------------------------------
Colonial 0.95% of June 1, 1999 On June 19, 2001, On June 1, 1999, the
International assets under the Trustees sole shareholder of the
Horizons $1 billion; approved the Fund approved the
Fund, 0.90% of continuation of Current Advisory
Variable assets over the current Agreement
Series(3) $1 billion advisory agreement
- ---------------------------------------------------------------------------------------
Colonial 0.80% May 19, 1998 On June 19, 2001, On May 19, 1998, the
Small Cap the Trustees sole shareholder of the
Value Fund, approved the Fund approved the
Variable continuation of Current Advisory
Series(4) the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
</Table>
A1-1
46
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE ACTION DATE OF LAST
ADVISORY FEE REGARDING CURRENT SUBMISSION OF CURRENT
RATE SCHEDULE DATE OF ADVISORY AGREEMENT ADVISORY AGREEMENT FOR
(ANNUAL RATE CURRENT SINCE BEGINNING SHAREHOLDER APPROVAL
OF THE NET ADVISORY OF FUND'S LAST AND REASON FOR
NAME OF FUND ASSET VALUE) AGREEMENT FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Colonial 0.65% May 2, 1994 On June 19, 2001, On February 27, 1995,
Strategic (amended the Trustees shareholders approved
Income Fund, February 28, approved the an amendment to the
Variable 1995) continuation of management agreement to
Series(5) the current allow Liberty Financial
advisory agreement and its affiliates to
perform certain
administrative duties
for the Fund
- ---------------------------------------------------------------------------------------
Colonial 0.80% of May 2, 1994 On June 19, 2001, On February 27, 1995,
U.S. Growth assets under (amended the Trustees shareholders approved
& Income $1 billion; February 28, approved the an amendment to the
Fund, 0.70% of 1995) continuation of management agreement to
Variable assets over the current allow Liberty Financial
Series(6) $1 billion advisory agreement and its affiliates to
perform certain
administrative duties
for the Fund
- ---------------------------------------------------------------------------------------
Crabbe Huson 1.00% June 1, 1999 On June 19, 2001, On June 1, 1999, the
Real Estate the Trustees sole shareholder of the
Investment approved the Fund approved the
Fund, continuation of Current Advisory
Variable the current Agreement
Series(7) advisory agreement
- ---------------------------------------------------------------------------------------
Liberty All- 0.80% November 15, On June 19, 2001, On November 15, 1997,
Star Equity 1997 the Trustees the sole shareholder of
Fund, approved the the Fund approved the
Variable continuation of Current Advisory
Series(8) the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Liberty 1.20% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Newport the Trustees sole shareholder of the
Japan approved the Fund approved the
Opportunities continuation of Current Advisory
Fund, the current Agreement
Variable advisory agreement
Series(9)
- ---------------------------------------------------------------------------------------
</Table>
A1-2
47
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE ACTION DATE OF LAST
ADVISORY FEE REGARDING CURRENT SUBMISSION OF CURRENT
RATE SCHEDULE DATE OF ADVISORY AGREEMENT ADVISORY AGREEMENT FOR
(ANNUAL RATE CURRENT SINCE BEGINNING SHAREHOLDER APPROVAL
OF THE NET ADVISORY OF FUND'S LAST AND REASON FOR
NAME OF FUND ASSET VALUE) AGREEMENT FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Liberty S&P 0.40% May 30, 2000 On June 19, 2001, On May 30, 2000, the
500 Index the Trustees sole shareholder of the
Fund, approved the Fund approved the
Variable continuation of Current Advisory
Series(10) the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Liberty 0.70% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Select Value the Trustees sole shareholder of the
Fund, approved the Fund approved the
Variable continuation of Current Advisory
Series(11) the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Liberty 0.65% June 7, 1993 On June 19, 2001, On February 27, 1995,
Value Fund, (amended the Trustees shareholders approved
Variable February 28, approved the an amendment to the
Series 1995) continuation of management agreement to
the current allow Liberty Financial
advisory agreement and its affiliates to
perform certain
administrative duties
for the Fund
- ---------------------------------------------------------------------------------------
Newport 0.90% May 1, 1995 On June 19, 2001, On May 1, 1995, the
Tiger Fund, the Trustees sole shareholder of the
Variable approved the Fund approved the
Series continuation of Current Advisory
the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Rydex 0.85% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Financial the Trustees sole shareholder of the
Services approved the Fund approved the
Fund, continuation of Current Advisory
Variable the current Agreement
Series(12) advisory agreement
- ---------------------------------------------------------------------------------------
Rydex Health 1.00% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Care Fund, the Trustees sole shareholder of the
Variable approved the Fund approved the
Series(13) continuation of Current Advisory
the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
</Table>
A1-3
48
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE ACTION DATE OF LAST
ADVISORY FEE REGARDING CURRENT SUBMISSION OF CURRENT
RATE SCHEDULE DATE OF ADVISORY AGREEMENT ADVISORY AGREEMENT FOR
(ANNUAL RATE CURRENT SINCE BEGINNING SHAREHOLDER APPROVAL
OF THE NET ADVISORY OF FUND'S LAST AND REASON FOR
NAME OF FUND ASSET VALUE) AGREEMENT FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Stein Roe 0.65% June 7, 1993 On June 19, 2001, On February 27, 1995,
Global (amended the Trustees shareholders approved
Utilities February 28, approved the an amendment to the
Fund, 1995) continuation of management agreement to
Variable the current allow Liberty Financial
Series advisory agreement and its affiliates to
perform certain
administrative duties
for the Fund
- ---------------------------------------------------------------------------------------
</Table>
A1-4
49
SRVIT FUNDS
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE ACTION DATE OF LAST
ADVISORY FEE REGARDING CURRENT SUBMISSION OF CURRENT
RATE SCHEDULE DATE OF ADVISORY AGREEMENT ADVISORY AGREEMENT FOR
(ANNUAL RATE CURRENT SINCE BEGINNING SHAREHOLDER APPROVAL
OF THE NET ADVISORY OF FUND'S LAST AND REASON FOR
NAME OF FUND ASSET VALUE) AGREEMENT FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Liberty 0.40% May 1, 1993 On June 19, 2001, On April 14, 1993,
Federal the Trustees shareholders approved a
Securities approved the new Advisory Agreement
Fund, continuation of with Stein Roe to
Variable the current eliminate breakpoints
Series advisory agreement in the fee and make it
a flat 0.40%
- ---------------------------------------------------------------------------------------
Stein Roe 0.45% May 1, 1993 On June 19, 2001, On April 14, 1993,
Balanced the Trustees shareholders approved a
Fund, approved the new Advisory Agreement
Variable continuation of with Stein Roe to
Series(14) the current increase the advisory
advisory agreement fee from 0.35% to 0.45%
- ---------------------------------------------------------------------------------------
Stein Roe 0.50% of May 1, 1993 On June 19, 2001, On April 13, 1993,
Growth Stock assets under the Trustees shareholders approved a
Fund, $1 billion; approved the new Advisory Agreement
Variable 0.45% of continuation of with Stein Roe to
Series(15) assets over the current eliminate breakpoints
$1 billion advisory agreement in the fee and make it
a flat 0.50%
- ---------------------------------------------------------------------------------------
Stein Roe 0.35% December 9, On June 19, 2001, On December 9, 1988,
Money Market 1988 the Trustees the sole shareholder of
Fund, approved the the Fund approved the
Variable continuation of Current Advisory
Series the current Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Stein Roe 0.50% May 1, 1993 On June 19, 2001, On April 14, 1998,
Small the Trustees shareholders approved a
Company approved the new Advisory Agreement
Growth Fund, continuation of with Stein Roe to
Variable the current eliminate breakpoints
Series advisory agreement in the fee and make it
a flat 0.50%
- ---------------------------------------------------------------------------------------
</Table>
A1-5
50
(1)The Colonial Global Equity Fund, Variable Series' advisor has voluntarily
agreed to reimburse all expenses including management fees so that total
expenses of the Fund (excluding interest, taxes, 12b-1, brokerage and
extraordinary expenses) do not exceed 1.15% of average daily net assets.
(2)The Colonial High Yield Securities Fund, Variable Series' advisor and
distributor have voluntarily agreed to reimburse all expenses including
management fees and distribution fees so that total expenses of the Fund
(excluding interest, taxes, brokerage and extraordinary expenses) do not
exceed 0.95% of average daily net assets.
(3)The Colonial International Horizons Fund, Variable Series' advisor has
voluntarily agreed to reimburse all expenses including management fees so
that total expenses of the Fund (excluding interest, taxes, 12b-1, brokerage
and extraordinary expenses) do not exceed 1.15% of average daily net assets.
(4)The Colonial Small Cap Value Fund, Variable Series' advisor and distributor
have voluntarily agreed to reimburse all expenses including management fees
and distribution fees so that total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 1.10%
of average daily net assets.
(5)The Colonial Strategic Income Fund, Variable Series' advisor and distributor
have voluntarily agreed to reimburse all expenses including management fees
and distribution fees so that total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 1.00%
of average daily net assets.
(6)The Colonial U.S. Growth & Income Fund, Variable Series' advisor and
distributor have voluntarily agreed to reimburse all expenses including
management fees and distribution fees so that total expenses of the Fund
(excluding interest, taxes, brokerage and extraordinary expenses) do not
exceed 1.00% of average daily net assets.
(7)The Crabbe Huson Real Estate Investment Fund, Variable Series' advisor has
voluntarily agreed to reimburse all expenses including management fees so
that total expenses of the Fund (excluding interest, taxes, 12b-1, brokerage
and extraordinary expenses) do not exceed 1.20% of average daily net assets.
(8)The Liberty All-Star Equity Fund, Variable Series' advisor and distributor
have voluntarily agreed to reimburse all expenses including management fees
and distribution fees so that total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 1.00%
of average daily net assets.
A1-6
51
(9)The Liberty Newport Japan Opportunities Fund, Variable Series' advisor and
distributor have voluntarily agreed to reimburse all expenses including
management fees and distribution fees so that total expenses of the Fund
(excluding interest, taxes, brokerage and extraordinary expenses) do not
exceed 1.85% of average daily net assets.
(10)The Liberty S&P 500 Index Fund, Variable Series' advisor and distributor
have voluntarily agreed to reimburse all expenses including management fees
and distribution fees so that the total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 0.75%
of average daily net assets.
(11)The Liberty Select Value Fund, Variable Series' advisor and distributor have
voluntarily agreed to reimburse all expenses including management fees and
distribution fees so that total expenses of the Fund (excluding interest,
taxes, brokerage and extraordinary expenses) do not exceed 1.10% of average
daily net assets.
(12)The Rydex Financial Services Fund, Variable Series' advisor and distributor
have voluntarily agreed to reimburse all expenses including management fees
and distribution fees so that total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 1.45%
of average daily net assets.
(13)The Rydex Health Care Fund, Variable Series' advisor and distributor have
voluntarily agreed to reimburse all expenses including management fees and
distribution fees so that the total expenses of the Fund (excluding
interest, taxes, brokerage and extraordinary expenses) do not exceed 1.60%
of average daily net assets.
(14) The Stein Roe Balanced Fund, Variable Series' advisor has voluntarily
agreed to reimburse all expenses including management fees so that total
expenses of the Fund (excluding interest, taxes, 12b-1, brokerage and
extraordinary expenses) do not exceed 0.75% of average daily net assets.
(15) The Stein Roe Growth Stock Fund, Variable Series' advisor has voluntarily
agreed to reimburse all expenses including management fees so that total
expenses of the Fund (excluding interest, taxes, 12b-1, brokerage and
extraordinary expenses) do not exceed 0.80% of average daily net assets.
A1-7
52
APPENDIX A2
SUB-ADVISORY AGREEMENTS
LVIT FUNDS
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SUB-ADVISORY DESCRIPTION OF DATE OF LAST
FEE RATE TRUSTEE ACTION SUBMISSION OF CURRENT
SCHEDULE REGARDING CURRENT SUB-ADVISORY
(ANNUAL RATE DATE OF SUB-ADVISORY AGREEMENT FOR
OF AVERAGE CURRENT AGREEMENT SINCE SHAREHOLDER APPROVAL
NAME OF FUND/ DAILY NET SUB-ADVISORY BEGINNING OF FUND'S AND REASON FOR
SUB-ADVISOR ASSETS)(1) AGREEMENT LAST FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Colonial 0.75% June 1, 1999 On June 19, 2001, On June 1, 1999, the
Global Equity the Trustees sole shareholder of
Fund, approved the the Fund approved the
Variable continuation of the Current Sub- Advisory
Series/ current sub- Agreement
Colonial advisory agreement
- ---------------------------------------------------------------------------------------
Colonial High 0.40% May 19, 1998 On June 19, 2001, On May 19, 1998, the
Yield the Trustees sole shareholder of
Securities approved the the Fund approved the
Fund, continuation of the Current Sub-Advisory
Variable current sub- Agreement
Series/ advisory agreement
Colonial
- ---------------------------------------------------------------------------------------
Colonial 0.70% March 24, On June 19, 2001, On February 27, 1995,
International 1995 the Trustees shareholders approved
Fund for approved the a new Sub- Advisory
Growth, continuation of the Agreement with
Variable current sub- Colonial. The
Series/ advisory agreement Agreements were
Colonial identical except for
the effective date
- ---------------------------------------------------------------------------------------
Colonial 0.75% June 1, 1999 On June 19, 2001, On June 1, 1999, the
International the Trustees sole shareholder of
Horizons approved the the Fund approved the
Fund, continuation of the Current Sub- Advisory
Variable current sub- Agreement
Series/ advisory agreement
Colonial
- ---------------------------------------------------------------------------------------
</Table>
A2-1
53
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SUB-ADVISORY DESCRIPTION OF DATE OF LAST
FEE RATE TRUSTEE ACTION SUBMISSION OF CURRENT
SCHEDULE REGARDING CURRENT SUB-ADVISORY
(ANNUAL RATE DATE OF SUB-ADVISORY AGREEMENT FOR
OF AVERAGE CURRENT AGREEMENT SINCE SHAREHOLDER APPROVAL
NAME OF FUND/ DAILY NET SUB-ADVISORY BEGINNING OF FUND'S AND REASON FOR
SUB-ADVISOR ASSETS)(1) AGREEMENT LAST FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Colonial 0.60% May 19, 1998 On June 19, 2001, On May 19, 1998, the
Small Cap the Trustees sole shareholder of
Value Fund, approved the the Fund approved the
Variable continuation of the Current Sub-Advisory
Series/ current sub- Agreement
Colonial advisory agreement
- ---------------------------------------------------------------------------------------
Colonial 0.45% March 24, On June 19, 2001, On February 27, 1995,
Strategic 1994 the Trustees shareholders approved
Income Fund, approved the a new Sub- Advisory
Variable continuation of the Agreement with
Series/ current sub- Colonial. The
Colonial advisory agreement Agreements were
identical except for
the effective date
- ---------------------------------------------------------------------------------------
Colonial U.S. 0.60% March 24, On June 19, 2001, On February 27, 1995,
Growth & 1995 the Trustees shareholders approved
Income Fund, approved the a new Sub- Advisory
Variable continuation of the Agreement with
Series/ current sub- Colonial. The
Colonial advisory agreement Agreements were
identical except for
the effective date
- ---------------------------------------------------------------------------------------
Crabbe Huson 0.80% June 1, 1999 On June 19, 2001, On June 1, 1999, the
Real Estate the Trustees sole shareholder of
Investment approved the the Fund approved the
Fund, continuation of the Current Sub- Advisory
Variable current sub- Agreement
Series/ advisory agreement
Crabbe Huson
- ---------------------------------------------------------------------------------------
Liberty All- 0.60% November 15, On June 19, 2001, On November 15, 1997,
Star Equity 1997 the Trustees the sole shareholder
Fund, approved the of the Fund approved
Variable continuation of the the Current Sub-
Series/ LAMCO current sub- Advisory Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
</Table>
A2-2
54
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SUB-ADVISORY DESCRIPTION OF DATE OF LAST
FEE RATE TRUSTEE ACTION SUBMISSION OF CURRENT
SCHEDULE REGARDING CURRENT SUB-ADVISORY
(ANNUAL RATE DATE OF SUB-ADVISORY AGREEMENT FOR
OF AVERAGE CURRENT AGREEMENT SINCE SHAREHOLDER APPROVAL
NAME OF FUND/ DAILY NET SUB-ADVISORY BEGINNING OF FUND'S AND REASON FOR
SUB-ADVISOR ASSETS)(1) AGREEMENT LAST FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Liberty 1.00% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Newport Japan the Trustees sole shareholder of
Opportunities approved the the Fund approved the
Fund, continuation of the Current Sub-Advisory
Variable current sub- Agreement
Series/ advisory agreement
Newport
- ---------------------------------------------------------------------------------------
Liberty S&P 0.20% May 30, 2000 On June 19, 2001, On May 30, 2000, the
500 Index the Trustees sole shareholder of
Fund, approved the the Fund approved the
Variable continuation of the Current Sub-Advisory
Series/ current sub- Agreement
Colonial advisory agreement
- ---------------------------------------------------------------------------------------
Liberty 0.50% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Select Value the Trustees sole shareholder of
Fund, approved the the Fund approved the
Variable continuation of the Current Sub-Advisory
Series/ current sub- Agreement
Colonial advisory agreement
- ---------------------------------------------------------------------------------------
Liberty Value 0.45% March 24, On June 19, 2001, On February 27, 1995,
Fund, 1995 the Trustees shareholders approved
Variable approved the a new Sub- Advisory
Series/ continuation of the Agreement with
Colonial current sub- Colonial. The
advisory agreement Agreements were
identical except for
the effective date
- ---------------------------------------------------------------------------------------
Newport Tiger 0.70% May 1, 1995 On June 19, 2001, On May 1, 1995, the
Fund, the Trustees sole shareholder of
Variable approved the the Fund approved the
Series/ continuation of the Current Sub- Advisory
Newport current sub- Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
</Table>
A2-3
55
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SUB-ADVISORY DESCRIPTION OF DATE OF LAST
FEE RATE TRUSTEE ACTION SUBMISSION OF CURRENT
SCHEDULE REGARDING CURRENT SUB-ADVISORY
(ANNUAL RATE DATE OF SUB-ADVISORY AGREEMENT FOR
OF AVERAGE CURRENT AGREEMENT SINCE SHAREHOLDER APPROVAL
NAME OF FUND/ DAILY NET SUB-ADVISORY BEGINNING OF FUND'S AND REASON FOR
SUB-ADVISOR ASSETS)(1) AGREEMENT LAST FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Rydex 0.65% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Financial the Trustees sole shareholder of
Services approved the the Fund approved the
Fund, continuation of the Current Sub-Advisory
Variable current sub- Agreement
Series/ advisory agreement
Colonial
- ---------------------------------------------------------------------------------------
Rydex Health 0.80% May 30, 2000 On June 19, 2001, On May 30, 2000, the
Care Fund, the Trustees sole shareholder of
Variable approved the the Fund approved the
Series/ continuation of the Current Sub-Advisory
Colonial current sub- Agreement
advisory agreement
- ---------------------------------------------------------------------------------------
Stein Roe 0.45% November 10, On June 19, 2001, On November 10, 1997,
Global 1997 the Trustees shareholders approved
Utilities approved the a new Sub- Advisory
Fund, continuation of the Agreement with Stein
Variable current sub- Roe. Previous
Series/Stein advisory agreement sub-advisor was
Roe Colonial
- ---------------------------------------------------------------------------------------
</Table>
SRVIT FUNDS
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SUB-ADVISORY DESCRIPTION OF DATE OF LAST
FEE RATE TRUSTEE ACTION SUBMISSION OF CURRENT
SCHEDULE REGARDING CURRENT SUB-ADVISORY
(ANNUAL RATE DATE OF SUB-ADVISORY AGREEMENT FOR
OF AVERAGE CURRENT AGREEMENT SINCE SHAREHOLDER APPROVAL
NAME OF FUND/ DAILY NET SUB-ADVISORY BEGINNING OF FUND'S AND REASON FOR
SUB-ADVISOR ASSETS)(1) AGREEMENT LAST FISCAL YEAR SUBMISSION
- ---------------------------------------------------------------------------------------
Stein Roe 0.40% of that May 1, 2001 On June 19, 2001, On April 5, 2001,
Balanced portion of the Trustees shareholders approved
Fund, the Fund's approved the the original
Variable assets under continuation of the Sub-Advisory
Series/ management by current sub- Agreement
Nordea Nordea advisory agreement
- ---------------------------------------------------------------------------------------
</Table>
(1) The Advisor is solely responsible for paying the Sub-Advisory Fee to the
Sub-Advisor from the fees it collects from the Fund.
A2-4
56
APPENDIX A3
PORTFOLIO MANAGEMENT AGREEMENTS
LVIT FUNDS
<Table>
<Caption>
- --------------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE
ACTION
REGARDING
CURRENT
PORTFOLIO PORTFOLIO DATE OF LAST
MANAGEMENT MANAGEMENT SUBMISSION OF CURRENT
FEE RATE AGREEMENT PORTFOLIO MANAGEMENT
SCHEDULE DATE OF CURRENT SINCE AGREEMENT FOR
(ANNUAL RATE OF PORTFOLIO BEGINNING SHAREHOLDER APPROVAL
NAME OF FUND/ THE NET ASSET MANAGEMENT OF FUND'S LAST AND REASON FOR
PORTFOLIO MANAGER VALUE)(1) AGREEMENT FISCAL YEAR SUBMISSION
- --------------------------------------------------------------------------------------------
Liberty All-Star Mastrapasqua & Mastrapasqua & On June 19, Approval not required
Equity Fund, Associates -- Associates -- 2001, the by shareholders
Variable Series/ 0.30% of the November 1, Trustees pursuant to exemptive
Mastrapasqua, assets managed 2000; approved each order issued by SEC on
Oppenheimer, TCW, by that Oppenheimer of the Fund's May 5, 1998
Westwood and Portfolio Capital -- May current
Boston Partners Manager; 5, 2000; TCW Portfolio
Oppenheimer Investment Management
Capital -- Management Agreements
0.30% of the Company -- July
assets managed 6, 2001;
by that Westwood
Portfolio Management
Manager; TCW Corporation --
Investment June 18, 1999;
Management Boston Partners
Company -- Asset
0.30% of the Management,
assets managed L.P. -- June
by that 18, 1999
Portfolio
Manager;
Westwood
Management
Corporation --
0.30% of the
assets managed
by that
Portfolio
Manager; Boston
Partners Asset
Management,
L.P. -- 0.30%
of the assets
managed by that
Portfolio
Manager
- --------------------------------------------------------------------------------------------
</Table>
A3-1
57
<Table>
<Caption>
- --------------------------------------------------------------------------------------------
DESCRIPTION OF
TRUSTEE
ACTION
REGARDING
CURRENT
PORTFOLIO PORTFOLIO DATE OF LAST
MANAGEMENT MANAGEMENT SUBMISSION OF CURRENT
FEE RATE AGREEMENT PORTFOLIO MANAGEMENT
SCHEDULE DATE OF CURRENT SINCE AGREEMENT FOR
(ANNUAL RATE OF PORTFOLIO BEGINNING SHAREHOLDER APPROVAL
NAME OF FUND/ THE NET ASSET MANAGEMENT OF FUND'S LAST AND REASON FOR
PORTFOLIO MANAGER VALUE)(1) AGREEMENT FISCAL YEAR SUBMISSION
- --------------------------------------------------------------------------------------------
Liberty S&P 500 $25,000 for the May 30, 2000 On June 19, On May 30, 2000, the
Index Fund, first $50 2001, the sole shareholder of
Variable Series/ million and Trustees the Fund approved the
SSgA FM 0.05% of approved the Current Portfolio
average daily current Management Agreement
net assets Portfolio
thereafter Management
Agreement
- --------------------------------------------------------------------------------------------
Rydex Financial 0.50%; 0.45% May 30, 2000 On June 19, On May 30, 2000, the
Services Fund, when combined 2001, the sole shareholder of
Variable Series/ assets of the Trustees the Fund approved the
Rydex Fund and Rydex approved the Current Portfolio
Health Care current Management Agreement
Fund, Variable Portfolio
Series reach Management
$300 million Agreement
- --------------------------------------------------------------------------------------------
Rydex Health Care 0.50%; 0.45% May 30, 2000 On June 19, On May 30, 2000, the
Fund, Variable when combined 2001, the sole shareholder of
Series/ Rydex assets of the Trustees the Fund approved the
Fund and Rydex approved the Current Portfolio
Financial current Management Agreement
Services Fund, Portfolio
Variable Series Management
reach $300 Agreement
million
- --------------------------------------------------------------------------------------------
</Table>
(1) The Sub-Advisor is solely responsible for paying the Portfolio Management
Fee to the Portfolio Manager(s) from the fees it collects from the Advisor.
A3-2
58
APPENDIX B1
FORM OF INVESTMENT ADVISORY AGREEMENT
[VARIATION 1 OF 3 -- APPLICABLE TO ALL LVIT FUNDS EXCEPT LIBERTY ALL-STAR EQUITY
FUND, VARIABLE SERIES, LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES, RYDEX
FINANCIAL SERVICES FUND, VARIABLE SERIES AND RYDEX HEALTH CARE FUND, VARIABLE
SERIES]
LIBERTY VARIABLE INVESTMENT TRUST
[ ] FUND, VARIABLE SERIES
[ ] FUND, VARIABLE SERIES
MANAGEMENT AGREEMENT
MANAGEMENT AGREEMENT ("Agreement"), made this [ ] day of [ ], 2001,
between LIBERTY VARIABLE INVESTMENT TRUST, a business trust organized under the
laws of The Commonwealth of Massachusetts (the "Trust"), on its own behalf and
on behalf of [ ] Fund, Variable Series and [ ] Fund,
Variable Series (each a "Fund," and collectively, the "Funds"), and LIBERTY
ADVISORY SERVICES CORP., a corporation organized under the laws of The
Commonwealth of Massachusetts (the "Manager").
WHEREAS, the Trust has been organized as an open-end management investment
company registered as such under the Investment Company Act of 1940, as amended
("Investment Company Act"), and is authorized to issue shares of beneficial
interest in one or more separate series (each representing interests in a
separate portfolio of securities and other assets), including the Funds, which
shares are to be issued and sold to and held by various separate accounts of
insurance companies ("Participating Insurance Companies");
WHEREAS, the Trust heretofore has created various other separate funds which are
covered by other Management Agreements among the Trust, on its own behalf and on
behalf of such other series funds, and the Manager, and the Trust may in the
future create additional fund(s) that may be covered by other separate
agreements;
WHEREAS, the Trust desires the Manager to render certain administrative services
and to render total investment management services to the
B1-1
59
Trust and the Funds, all in the manner and on the terms and conditions
hereinafter set forth;
WHEREAS, the Trust authorizes the Manager to enter into sub-advisory agreements
with one or more firms registered as investment advisers under the Investment
Advisors Act of 1940, as amended (the "Investment Adviser's Act"), or qualifying
as a "bank" within the meaning of the Investment Adviser's Act and thereby
exempted from the requirement to be so registered, to manage all or a portion of
a Fund's assets, as determined by the Manager from time to time (a "Sub-
Adviser"); and
WHEREAS, the Manager is registered as an investment adviser under the Investment
Adviser's Act, and desires to provide services to the Trust and the Funds in
consideration of and on the terms and conditions hereinafter set forth;
NOW, THEREFORE, the Trust, on its own behalf and on behalf of the Funds, and the
Manager hereby agree as follows:
1. EMPLOYMENT OF THE INVESTMENT ADVISER. The Trust hereby employs the Manager
(i) to provide certain administrative and limited oversight services and (ii) to
provide investment management and related services to the Trust and the Funds,
all in the manner set forth in Section 2 of this Agreement, subject to the
direction of the Trustees, and for the period, in the manner, and on the terms
set forth hereinafter. The Manager hereby accepts such employment and agrees
during such period to render the services and to assume the obligations herein
set forth. The Manager shall for all purposes herein be deemed to be an
independent contractor and, except as expressly provided or authorized (whether
herein or otherwise), shall have no authority to act for or represent the Trust
in any way or otherwise be deemed an agent of the Trust.
2. OBLIGATIONS OF, AND SERVICES TO BE PROVIDED BY, THE MANAGER. The Manager
undertakes to provide the services hereinafter set forth and to assume the
following obligations:
A. Administrative Services.
(a) The Manager will provide general administrative services as hereinafter set
forth ("Administrative Services"), all subject to the overall direction and
control of the Board of Trustees of the Trust (the "Board").
B1-2
60
(b) Such Administrative Services shall not include investment advisory,
custodian, underwriting and distribution, transfer agency or pricing and
bookkeeping services, but shall include; (i) provision of office space,
equipment and facilities necessary in connection with the services to be
performed hereunder and the maintenance of the headquarters of the Trust; (ii)
maintenance of the corporate books and records of the Trust (other than those of
its records maintained by the Sub-Advisers referred to in paragraph 2(B)(c)
below, the transfer agent, the custodian and the pricing and bookkeeping agent);
(iii) administration of all dealings and relationships with the Trustees for
meetings of the Board, the scheduling of such meetings and the conduct thereof;
(iv) preparation and filing of proxy materials and administration of
arrangements for meetings of shareholders or beneficial owners of the Funds; (v)
preparation and filing of all required reports and all updating and other
amendments to the Trust's Registration Statement under the Investment Company
Act, the Securities Act of 1933, as amended (the "Securities Act"), and the
rules and regulations thereunder; (vi) calculation of distributions required or
advisable under the Investment Company Act and the Internal Revenue Code of
1986, as amended (the "Code"); (vii) periodic computation and reporting to the
Trustees of each Fund's compliance with diversification and other portfolio
requirements of the Investment Company Act and the Code; (viii) development and
implementation of general shareholder and beneficial owner correspondence and
communications relating to the Funds, including the preparation and filing of
shareholder and beneficial owner reports as are required or deemed advisable;
and (ix) general oversight of the custodial, net asset value computation,
portfolio accounting, financial statement preparation, legal, tax and accounting
services performed for the Trust or the Funds by others.
It is understood that the Manager may, in its discretion and at its expense,
delegate some or all of its administrative duties and responsibilities under
this subsection 2A to any of its affiliates.
B. Investment Advisory Services.
(a) The Manager shall have responsibility for the management and investment of
the assets of the Funds, subject to and in accordance with the separate
investment objectives, policies and limitations of the Funds, as provided in the
Trust's Prospectus and Statement of Additional Information and governing
instruments, as amended from time to time, and any directions and policies which
the Trustees may issue to the Manager from time to time.
B1-3
61
(b) The Manager shall provide a continuous investment program for the Funds,
shall revise each such program as necessary, and shall monitor implementation of
the program.
(c) The Manager may delegate its investment responsibilities under paragraph
2B(a) with respect to each Fund to one or more persons or companies registered
as investment advisers under the Investment Adviser's Act or qualifying as a
"bank" within the meaning of the Investment Adviser's Act and thereby exempted
from the requirement to be so registered ("Sub-Advisers") pursuant to an
agreement among the Trust, such Fund and each Sub-Adviser ("Sub-Advisory
Agreement"). Each Sub-Advisory Agreement may provide that the Sub-Adviser,
subject to the control and supervision of the Trustees and the Manager, shall
have full investment discretion for the Fund and shall make all determinations
with respect to the investment of the Fund's assets or any portion thereof
specified by the Manager. Any delegation of duties pursuant to this paragraph
shall comply with any applicable provisions of Section 15 of the Investment
Company Act, except to the extent permitted by any exemptive order of the
Securities and Exchange Commission or similar relief.
(d) The Manager shall be solely responsible for paying the fees of each
Sub-Adviser from the fees it collects as provided in paragraph 6 below.
(e) The Manager shall evaluate possible Sub-Advisers and shall advise the
Trustees of the candidates which the Manager believes are best suited to invest
the assets of each Fund; shall monitor and evaluate the investment performance
of each Sub-Adviser; shall recommend changes of or additions of Sub-Advisers
when appropriate; and shall coordinate the investment activities of the
Sub-Advisers.
(f) It is understood that the Manager may seek advice with respect to the
performance of any or all of its duties under paragraphs 2B(b) and (c) from a
person or company ("Consultant") pursuant to an agreement among the Manager, the
Trust and the Consultant (a "Fund Consulting Agreement"). A Fund Consulting
Agreement may provide that the Consultant, subject to the control and
supervision of the Trustees and the Manager, shall provide assistance to the
Manager with respect to each Fund's investment program, the selection,
monitoring and evaluation of Sub-Advisers and the allocation of each Fund's
assets to the Sub-Advisers.
B1-4
62
(g) The Funds shall be solely responsible for paying the fees of any
Consultant.
(h) The Manager shall render regular reports to the Trustees relating to the
performance of its duties specified in paragraphs 2B(a), (b) and (c).
C. Expenses Borne By Manager. To the extent necessary to perform its
obligations under this Agreement, the Manager, at its own expense, shall furnish
executive and other personnel and office space, equipment and facilities, and
shall pay any other expenses incurred by it, in connection with the performance
of its duties hereunder, except that the Trust or the Funds, as appropriate,
shall reimburse the Manager for its out-of-pocket costs, including telephone,
postage and supplies, incurred by it in connection with communications with
shareholders and beneficial owners of the Funds. The Manager shall pay all
salaries, fees and expenses of Trustees or officers of the Trust who are
employees of the Manager. The Manager shall not be obligated to bear any other
expenses incidental to the operations and business of the Trust. The Manager
shall not be required to pay or provide any credit for services provided by the
Trust's custodian, transfer agent or other agents.
D. Provision of Information Necessary for Preparation of Registration Statement
Amendments and Other Materials. The Manager will make available and provide
such information as the Trust may reasonably request for use in the preparation
of its Registration Statement, reports and other documents required by federal
laws and any securities and insurance laws of the other states and other
jurisdictions in which the Trust's shares are sold.
E. Code of Ethics. The Manager has adopted a written code of ethics complying
with the requirements of Rule 17j-1 under the Investment Company Act and has
provided the Trust with a copy of the code of ethics and evidence of its
adoption. Within forty-five (45) days of the end of the last calendar quarter of
each year while this Agreement is in effect, an executive officer of the Manager
shall verify to the Trustees that the Manager has complied with the requirements
of Rule 17j-1 during the previous year and that there has been no violation of
the Manager's code of ethics or, if such a violation has occurred, that
appropriate action was taken in response to such violation. Upon the written
request of the Trust, the Manager shall permit the Trust to
B1-5
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examine the reports required to be made to the Manager by Rule 17j-1(c)(1).
F. Disqualification. The Manager shall immediately notify the Trustees of the
occurrence of any event which would disqualify the Manager from serving as an
investment adviser of an investment company pursuant to Section 9(a) of the
Investment Company Act or any other applicable statute or regulation.
G. Other Obligations and Service. The Manager shall make its officers and
employees available to the Trustees and officers of the Trust for consulting and
discussions regarding the management of the Trust and its investment activities.
3. EXECUTION AND ALLOCATION OF PORTFOLIO BROKERAGE.
A. The Manager, subject to the control and direction of the Trustees, any
Sub-Advisers, subject to the control and direction of the Trustees and the
Manager, shall have authority and discretion, as appropriate, to select brokers
and dealers to execute portfolio transactions for each Fund, and for the
selection of the markets on or in which the transactions will be executed.
B. In acting pursuant to paragraph 3A, the Manager and the Sub-Advisers may
place orders through such brokers and dealers in conformity with the policy with
respect to brokerage set forth in the Trust's then effective Registration
Statement.
C. It is understood that none of the Trust, the Manager or any Sub-Advisers
will adopt a formula for allocation of the Trust's brokerage, except as may be
provided for in the custody agreement with the Trust's Custodian.
D. It is understood that the Manager or a Sub-Adviser may, to the extent
permitted by applicable laws and regulations, aggregate securities to be sold or
purchased for a Fund and for other clients in order to obtain the most favorable
price and efficient execution. In that event, allocation of the securities
purchased or sold, as well as expenses incurred in the transaction, will be made
by the Manager or Sub-Adviser, as the case may be, in the manner it considers to
be the most equitable and consistent with its fiduciary obligations to the Trust
and to its other clients, and in conformity with any applicable policies adopted
by the Board of Trustees.
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64
E. The Manager shall provide such reports as the Trustees may reasonably
request with respect to each Fund's total brokerage and the manner in which that
brokerage was allocated.
4. EXPENSES OF THE TRUST.
It is understood that the Trust (or each of its funds (including the Funds),
where applicable) will pay, or will enter into arrangements that require third
parties to pay, all of the expenses of the Trust or such funds, other than those
expressly assumed by the Manager herein, including without limitation:
A. Advisory, sub-advisory and administrative fees;
B. Fees for services of independent public accountants;
C. Legal and consulting fees;
D. Transfer agent, custodian and portfolio recordkeeping and tax information
services;
E. Expenses of periodic calculations of the funds' net asset values and of
equipment for communication among the funds' custodian, transfer agent and
others;
F. Taxes and the preparation of the funds' tax returns;
G. Brokerage fees and commissions;
H. Interest;
I. Costs of Board of Trustees and shareholder meetings;
J. Updates and printing of prospectuses and reports to shareholders;
K. Fees for filing reports with regulatory bodies and the maintenance of the
Trust's existence;
L. Membership dues for industry trade associations;
M. Fees to federal authorities for the registration of the shares of the funds;
N. Fees and expenses of Trustees who are not directors, officers, employees or
stockholders of the Manager of its affiliates;
O. Insurance and fidelity bond premiums; and
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65
P. Litigation and other extraordinary expenses of a non-recurring nature.
5. ACTIVITIES AND AFFILIATES OF THE MANAGER.
A. The Trust acknowledges that the Manager or one or more of its affiliates may
have investment or administrative responsibilities or render investment advice
to or perform other investment advisory services for other individuals or
entities, and that the Manager, its affiliates or any of its or their directors,
officers, agents or employees may buy, sell or trade in securities for its or
their respective accounts ("Affiliated Accounts"). Subject to the provisions of
paragraph 3, the Trust agrees that the Manager or its affiliates may give advice
or exercise investment responsibility and take such other action with respect to
Affiliated Accounts which may differ from the advice given or the timing or
nature of action with respect to the Funds, provided that the Manager acts in
good faith. The Trust acknowledges that one or more of the Affiliated Accounts
may at any time hold, acquire, increase, decrease, dispose of or otherwise deal
with positions in investments in which the Fund may have an interest. The
Manager shall have no obligation to recommend for the Funds a position in any
investment which an Affiliated Account may acquire, and the Trust shall have no
first refusal, co-investment or other rights in respect of any such investment,
either for the Funds or otherwise.
B. Subject to and in accordance with the Declaration of Trust and By-Laws of
the Trust as currently in effect and the Investment Company Act and the rules
thereunder, it is understood that Trustees, officers and agents of the Trust and
shareholders of the Trust are or may be interested persons as defined by the
Investment Company Act ("Interested Persons") of the Manager or its affiliates
as directors, officers, agents and shareholders of the Manager or its
affiliates; that directors, officers, agents and shareholders of the Manager or
its affiliates are or may be Interested Persons of the Trust as Trustees,
officers, agents, shareholders or otherwise; that the Manager or its affiliates
may be Interested Persons of the Trust as shareholders or otherwise; and that
the effect of any such interests shall be governed by said Declaration of Trust,
By-Laws and the Investment Company Act and the rules thereunder.
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6. COMPENSATION OF THE MANAGER.
For all services to be rendered and payments made pursuant to this Agreement,
the Trust, on its own behalf and on behalf of Funds, will pay the Manager
monthly in arrears a fee at an annual rate equal to [ ]%, in the case of
[ ] Fund, Variable Series, and [ ]%, in the case of [ ]
Fund, Variable Series, of the net asset value of such Fund. The fee shall be
accrued for each calendar day and the sum of the daily fee accruals shall be
paid monthly on or before the tenth day of the following calendar month. The
daily accruals of the fee will be computed by (i) multiplying the annual
percentage rate referred to above by the fraction the numerator of which is one
and the denominator of which is the number of calendar days in the year, and
(ii) multiplying the product obtained pursuant to clause (i) above by the net
asset value of such Fund as determined in accordance with the Trust's Prospectus
as of the previous business day on which such Fund was open for business. The
foregoing fee shall be prorated for any month during which this Agreement is in
effect for only a portion of the month.
7. LIABILITIES OF THE MANAGER.
A. Except as provided below, in the absence of willful misfeasance, bad faith,
gross negligence, or reckless disregard of obligations or duties hereunder on
the part of the Manager, the Manager shall not be subject to liability to the
Trust or to any shareholder of the Trust for any act or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security.
B. The Manager shall indemnify and hold harmless the Trust from any loss, cost,
expense or damage resulting from the failure of any Sub-Advisor to comply with
(i) any statement included in the Prospectus and Statement of Additional
Information of the Trust, or (ii) instructions given by the Manager to any
Sub-Advisor for the purpose of ensuring the Trust's compliance with securities,
tax and other requirements applicable to the Trust's business and the investment
activities of its Funds; provided, however, that the indemnification provided in
this paragraph 7B shall apply only to the extent that a Sub-Adviser is liable to
the Trust and, after demand by the Trust, is unable or refuses to discharge its
obligations to the Trust.
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C. No provision of this Agreement shall be construed to protect any Trustee or
officer of the Trust, or the Manager, from liability in violation of Sections
17(h) and (i) of the Investment Company Act.
8. EFFECTIVE DATE: TERM.
This Agreement shall become effective on the later of (i) the date first written
above or (ii) the date on which the offer and sale of shares of the Fund has
been registered under the Securities Act and the Investment Company Act pursuant
to an effective Registration Statement of the Trust on Form N-1A and shall
continue until [ ], and from year to year thereafter, but only so long as
such continuance is specifically approved at least annually by a vote of the
Trustees, including the vote of a majority of the Trustees who are not
interested persons of the Trust, cast in person at a meeting called for the
purpose of voting on such approval, or by vote of a majority of the outstanding
voting securities. The aforesaid provision shall be construed in a manner
consistent with the Investment Company Act and the rules and regulations
thereunder.
9. ASSIGNMENT.
No assignment of this Agreement shall be made by the Manager, and this Agreement
shall terminate automatically in the event of any such assignment. The Manager
shall notify the Trust in writing in advance of any proposed change of control
to enable the Trust to take the steps necessary to enter into a new advisory
contract.
10. AMENDMENT
This Agreement may be amended at any time, but only by written Agreement between
the Manager and the Trust, which is subject to the approval of the Trustees of
the Trust and the shareholders of any affected Fund in the manner required by
the Investment Company Act and the rules thereunder.
11. TERMINATION. This Agreement:
(a) may at any time be terminated without payment of any penalty, by the Trust
(by the Board of Trustees of the Trust or by the vote of a majority of the
outstanding voting securities of the Fund) on sixty (60) days' written notice to
the Manager;
(b) shall immediately terminate in the event of its assignment; and
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(c) may be terminated by the Manager on sixty (60) days written notice to the
Trust.
12. DEFINITIONS. As used in this Agreement, the terms "affiliated person,"
"assignment," "control," "interested person" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth in the
Investment Company Act and the rules and regulations thereunder, subject to any
applicable orders of exemption issued by the SEC.
13. NOTICE. Any notice under this Agreement shall be given in writing
addressed and delivered or mailed postpaid to the other party to this Agreement
at its principal place of business.
14. SEVERABILITY. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
15. SHAREHOLDER LIABILITY. The Manager is hereby expressly put on notice of
the limitation of shareholder liability as set forth in the Declaration of Trust
of the Trust and agrees that obligations assumed by the Trust pursuant to this
Agreement shall be limited in all cases to the Trust and its assets, and if the
liability relates to one or more Funds, the obligations thereunder shall be
limited to the respective assets of such Funds. The Manager further agrees that
it shall not seek satisfaction of any such obligation from the shareholders of
the Funds, nor from the Trustees or any individual Trustee of the Trust.
16. GOVERNING LAW. This Agreement shall be interpreted under, and the
performance of the Manager under this Agreement shall be consistent with, the
provisions of the Agreement and Declaration of Trust and By-Laws of the Trust,
the terms of the Investment Company Act, applicable rules and regulations
thereunder, the Code and regulations thereunder, and the Trust's Prospectus and
Statement of Additional Information, in each case as from time to time in
effect. The provisions of this Agreement shall be construed and interpreted in
accordance with the domestic substantive laws of The Commonwealth of
Massachusetts without giving effect to any choice or conflict of laws rules or
provisions that would result in the application of the domestic substantive laws
of any other jurisdiction; provided, however, that if such law or any of the
provisions of this Agreement conflict with the applicable provisions of the
Investment Company Act, the latter shall control.
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17. USE OF MANAGER'S NAME. The Trust may use the name [" "] or any other
name derived from the name [" "] only for so long as this Agreement (or
another similar management agreement pertaining to other series funds of the
Trust) or any extension, renewal, or amendment hereof (or thereof) remains in
effect, including any similar agreement with any organization that shall have
succeeded to the business of the Manager. At such time as this Agreement (and
each other similar agreement pertaining to such other series funds) or any
extension, renewal or amendment hereof (or thereof), or each such other similar
successor organization agreement shall no longer be in effect, the Trust will
cease to use any name derived from the name [" ,"] any name similar thereto,
or any other name indicating that it is managed by or otherwise connected with
the Manager, or with any organization which shall have succeeded to Manager's
business as investment advisor or manager.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original.
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IN WITNESS WHEREOF, the parties hereto have duly executed this agreement on the
date first above written.
ATTEST:
- --------------------------------
Title: Secretary
ATTEST:
- --------------------------------
Title: Secretary
LIBERTY VARIABLE
INVESTMENT TRUST,
on its own behalf and on behalf of
[ ] Fund, Variable Series and
[ ] Fund, Variable Series
By:
-----------------------------------
Title:
LIBERTY ADVISORY SERVICES CORP.
By:
-----------------------------------
Title:
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FORM OF INVESTMENT ADVISORY AGREEMENT
[VARIATION 2 OF 3 -- APPLICABLE TO LIBERTY ALL-STAR EQUITY FUND, VARIABLE
SERIES, LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES, RYDEX FINANCIAL SERVICES
FUND, VARIABLE SERIES AND RYDEX HEALTH CARE FUND, VARIABLE SERIES]
LIBERTY VARIABLE INVESTMENT TRUST
[ ] FUND, VARIABLE SERIES
MANAGEMENT AND SUB-ADVISORY AGREEMENT
MANAGEMENT AND SUB-ADVISORY AGREEMENT ("Agreement"), made this [ ] day of
[ ] 2001, between LIBERTY VARIABLE INVESTMENT TRUST, a business
trust organized under the laws of The Commonwealth of Massachusetts (the
"Trust"), on its own behalf and on behalf of the [ ] Fund, Variable
Series (the "Fund"), LIBERTY ADVISORY SERVICES CORP., a corporation organized
under the laws of The Commonwealth of Massachusetts ("LASC"), and
[ ], a corporation organized under the laws of the State of
[ ] (the "Sub-Advisor").
WHEREAS, the Trust has been organized as an open-end management investment
company registered as such under the Investment Company Act of 1940, as amended
("Investment Company Act"), and is authorized to issue shares of beneficial
interest in one or more separate series (each representing interests in a
separate portfolio of securities and other assets), including the Fund, which
shares are to be issued and sold to and held by various separate accounts of
insurance companies ("Participating Insurance Companies");
WHEREAS, the Trust heretofore has created various other separate funds which are
covered by other Management Agreements among the Trust, on its own behalf and on
behalf of such other series funds, and LASC, and the Trust may in the future
create additional fund(s) that may be covered by other separate agreements;
WHEREAS, the Trust desires LASC to render certain investment management and
administrative services to the Trust and the Fund, all in the manner and on the
terms and conditions hereinafter set forth;
WHEREAS, the Trust and LASC desire that the Sub-Advisor, as sub-adviser to LASC,
provide investment management services to the Fund based on the Sub-Advisor's
multi-manager concept, under which the
B1-14
72
Sub-Advisor recommends, over-sees and coordinates, and allocates the Fund's
portfolio assets among, several portfolio managers ("Portfolio Managers"), each
having a different investment style, each of which manages a different portion
of the Fund's investment portfolio; and
WHEREAS, each of LASC and the Sub-Advisor is registered as an investment adviser
under the Investment Adviser's Act of 1940, as amended (the "Investment
Adviser's Act"), and desires to provide services to the Trust and the Fund, in
the manner contemplated above, in consideration of and on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, the Trust, on its own behalf and on behalf of the Fund, LASC and
the Sub-Advisor hereby agree as follows:
1. EMPLOYMENT OF THE INVESTMENT ADVISER. The Trust hereby employs LASC (i) to
provide certain administrative and limited oversight services and (ii) to
provide certain investment management and related services to the Trust and the
Fund, all in the manner set forth in Section 2 of this Agreement, subject to the
direction of the Trustees, and for the period, in the manner, and on the terms
set forth hereinafter. LASC hereby accepts such employment and agrees during
such period to render the services and to assume the obligations herein set
forth. LASC shall for all purposes herein be deemed to be an independent
contractor and, except as expressly provided or authorized (whether herein or
otherwise), shall have no authority to act for or represent the Trust in any way
or otherwise be deemed an agent of the Trust.
2. OBLIGATIONS OF, AND SERVICES TO BE PROVIDED BY, THE MANAGER. LASC undertakes
to provide the services hereinafter set forth and to assume the following
obligations:
A. Administrative Services.
(a) LASC will provide general administrative services as hereinafter set forth
("Administrative Services"), all subject to the overall direction and control of
the Board of Trustees of the Trust (the "Board").
(b) Such Administrative Services shall not include investment advisory,
custodian, underwriting and distribution, transfer agency or pricing and
bookkeeping services, but shall include: (i) provision of office space,
equipment and facilities necessary in connection with the services to be
performed hereunder and the maintenance of the headquarters of the Trust; (ii)
maintenance of the corporate books and records of the Trust (other than those of
its records maintained by the Sub-Advisor or the Portfolio Managers, the
transfer agent, the custodian and the pricing and
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bookkeeping agent); (iii) administration of all dealings and relationships with
the Trustees for meetings of the Board, the scheduling of such meetings and the
conduct thereof; (iv) preparation and filing of proxy materials and
administration of arrangements for meetings of shareholders or beneficial owners
of the Funds; (v) preparation and filing of all required reports and all
updating and other amendments to the Trust's Registration Statement under the
Investment Company Act, the Securities Act of 1933, as amended (the "Securities
Act"), and the rules and regulations thereunder; (vi) calculation of
distributions required or advisable under the Investment Company Act and the
Internal Revenue Code of 1986, as amended (the "Code"); (vii) periodic
computation and reporting to the Trustees of each Fund's compliance with
diversification and other portfolio requirements of the Investment Company Act
and the Code; (viii) development and implementation of general shareholder and
beneficial owner correspondence and communications relating to the Funds,
including the preparation and filing of shareholder and beneficial owner reports
as are required or deemed advisable; and (ix) general oversight of the
custodial, net asset value computation, portfolio accounting, financial
statement preparation, legal, tax and accounting services performed for the
Trust or the Fund by others.
It is understood that LASC may, in its discretion and at its expense, delegate
some or all of its administrative duties and responsibilities under this
subsection 2A to any of its affiliates.
B. Investment Advisory Services.
(a) LASC shall have overall supervisory responsibility for the management and
investment of the assets of the Fund, subject to and in accordance with the
investment objectives, policies and limitations of the Fund, as provided in the
Trust's Prospectus and Statement of Additional Information and governing
instruments, as amended from time to time, and any directions and policies which
the Trustees may issue to LASC from time to time (collectively, "Investment
Policies").
(b) With the consent of the Trust, on behalf of the Fund, LASC hereby delegates
to the Sub-Advisor the obligation to provide the Fund, as sub-advisor to LASC,
an overall investment program and strategy, in accordance with the Sub-Advisor's
multi-manager concept. LASC shall be solely responsible for paying the fees of
the Sub-Advisor from the fees it collects from the Trust as provided in
paragraph 5 below.
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(c) In accordance with the Sub-Advisor's multi-manager concept, the Sub-Advisor
will recommend to the Trustees one or more persons or companies registered as
investment advisers under the Investment Adviser's Act or qualifying as a "bank"
within the meaning of the Investment Adviser's Act and thereby exempted from the
requirement to be so registered ("Portfolio Managers"), pursuant to a portfolio
management agreement among the Trust, on behalf of the Fund, each Portfolio
Manager and the Sub-Advisor. Each Portfolio Manager shall have full investment
discretion and authority to make all determinations with respect to the
investment and reinvestment of the portion of the Fund's assets assigned to that
Portfolio Manager by the Sub-Advisor from time to time and the purchase and sale
of portfolio securities with those assets, all within the Fund's Investment
Policies. Subject to Section 6, the Sub-Advisor shall not be responsible or
liable for the investment merits of any decision by a Portfolio Manager to
purchase hold or sell a security for the Fund's portfolio. The Sub-Advisor shall
advise the Trustees as to which persons or companies the Sub-Advisor believes
are best suited for appointment as Portfolio Managers; shall monitor and
evaluate the investment performance of each Portfolio Manager, shall allocate
and reallocate from time to time, in its sole discretion, the respective
portions of the Fund's assets to be managed by the Portfolio Managers; shall
recommend to the Trustees changes of, additions to or terminations of Portfolio
Managers when it believes such changes, additions or terminations are
appropriate; and shall coordinate the investment activities of the Portfolio
Managers with a view to ensuring their compliance with the Fund's Investment
Policies and applicable laws.
(d) The Sub-Advisor shall be solely responsible for paying the fees of each
Portfolio Manager from the fees it collects from LASC as provided in paragraph 5
below.
(e) LASC and/or the Sub-Advisor shall render regular reports to the Board
relating to the performance of their duties specified in paragraphs 2B(a), (b)
and (c).
C. Expenses Borne By Manager. To the extent necessary to perform its
obligations under this Agreement, LASC and/or the Sub-Advisor, at their own
expense, shall furnish executive and other personnel and office space, equipment
and facilities, and shall pay any other expenses incurred by them, in connection
with the performance of their duties hereunder, except that the Trust or the
Fund, as appropriate, shall
B1-17
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reimburse LASC and/or the Sub-Advisor (as appropriate) for its out-of-pocket
costs, including telephone, postage and supplies, incurred by it in connection
with communications with shareholders and beneficial owners of the Fund. LASC
and/or the Sub-Advisor shall pay all salaries, fees and expenses of Trustees or
officers of the Trust who are their employees. LASC and the Sub-Advisor shall
not be obligated to bear any other expenses incidental to the operations and
business of the Trust. LASC and the Sub-Advisor shall not be required to pay or
provide any credit for services provided by the Trust's custodian, transfer
agent or other agents.
D. Provision of Information Necessary for Preparation of Registration Statement
Amendments and Other Materials. LASC will make available and provide such
information as the Trust may reasonably request for use in the preparation of
its Registration Statement, reports and other documents required by federal laws
and any securities and insurance laws of the other states and other
jurisdictions in which the Trust's shares are sold.
E. Code of Ethics. Each of LASC and the Sub-Advisor has adopted a written code
of ethics complying with the requirements of Rule 17j-1 under the Investment
Company Act and has provided the Trust with a copy of such code of ethics and
evidence of its adoption. On or before June 1 in each year, an executive officer
of each of LASC and the Sub-Advisor shall verify to the Trustees that it has
complied with the requirements of Rule 17j-1 during the previous year and that
there has been no material violation of its code of ethics or, if such a
violation has occurred, that appropriate action was taken in response to such
violation. Upon the written request of the Trust, each of LASC and the Sub-
Advisor shall permit the Trust to examine the reports required to be made to it
by Rule 17j-1(c)(1).
F. Disqualification. Each of LASC and the Sub-Advisor shall immediately notify
the Trustees of the occurrence of any event which would disqualify it from
serving as an investment adviser of an investment company pursuant to Section
9(a) of the Investment Company Act or any other applicable statute or
regulation.
G. Other Obligations and Service. Each of LASC and the Sub-Advisor shall make
its officers and employees available to the Trustees and officers of the Trust
for consulting and discussions regarding the management of the Trust and its
investment activities.
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3. EXPENSES OF THE TRUST. It is understood that the Trust (or each of its
funds (including the Fund), where applicable) will pay, or will enter into
arrangements that require third parties to pay, all of the expenses of the Trust
or such funds, other than those expressly assumed by LASC and the Sub-Advisor
herein, including without limitation:
A. Advisory, sub-advisory and administrative fees;
B. Fees for services of independent public accountants;
C. Legal and consulting fees;
D. Transfer agent, custodian and portfolio pricing, recordkeeping and
tax information services;
E. Expenses of periodic calculations of the funds' net asset values
and of equipment for communication among the funds' custodian,
transfer agent and others;
F. Taxes and the preparation of the funds' tax returns;
G. Brokerage fees and commissions;
H. Interest;
I. Costs of Board of Trustees and shareholder meetings;
J. Updates and printing of prospectuses, proxy statements and reports
to shareholders;
K. Fees for filing reports with regulatory bodies and the maintenance
of the Trust's existence;
L. Membership dues for industry trade associations;
M. Fees to federal authorities for the registration of the shares of
the funds;
N. Fees and expenses of Trustees who are not directors, officers,
employees or stockholders of LASC, the Sub-Advisor or any of their
respective affiliates;
O. Insurance and fidelity bond premiums; and
P. Litigation and other extraordinary expenses of a non-recurring
nature.
B1-19
77
4. ACTIVITIES AND AFFILIATES OF THE MANAGER.
A. The Trust acknowledges that each of LASC and the Sub-Advisor or one or more
of its affiliates may have investment or administrative responsibilities or
render investment advice to or perform other investment advisory services for
other individuals or entities, and that each of LASC and the Sub-Advisor, its
affiliates or any of its or their directors, officers, agents or employees may
buy, sell or trade in securities for its or their respective accounts
("Affiliated Accounts"). The Trust agrees that each of LASC and the Sub-Advisor
or its affiliates may give advice or exercise investment responsibility and take
such other action with respect to Affiliated Accounts which may differ from the
advice given or the timing or nature of action with respect to the Fund,
provided that it acts in good faith. The Trust acknowledges that one or more of
the Affiliated Accounts may at any time hold, acquire, increase, decrease,
dispose of or otherwise deal with positions in investments in which the Fund may
have an interest.
B. Subject to and in accordance with the Declaration of Trust and By-Laws of
the Trust as currently in effect and the Investment Company Act and the rules
thereunder, it is understood that Trustees, officers and agents of the Trust and
shareholders of the Trust are or may be interested persons as defined by the
Investment Company Act of LASC and/or the Sub-Advisor or of their respective
affiliates as directors, officers, agents and shareholders thereof; that
directors, officers, agents and shareholders of LASC and/or the Sub-Advisor or
of their respective affiliates are or may be interested persons of the Trust as
Trustees, officers, agents, shareholders or otherwise; that LASC and/or the Sub-
Advisor or their respective affiliates may be interested persons of the Trust as
shareholders or otherwise; and that the effect of any such interests shall be
governed by said Declaration of Trust and By-Laws and the Investment Company Act
and the rules thereunder.
5. COMPENSATION OF LASC AND THE SUB-ADVISOR. For all services to be rendered
and payments made pursuant to this Agreement, (a) the Trust, on its own behalf
and on behalf of the Fund, will pay LASC monthly in arrears a fee at an annual
rate equal to [ ]% of the net asset value of the Fund, and (b) LASC, on its
own behalf, will pay the Sub-Advisor monthly in arrears a fee at an annual rate
equal to [ ]% of such net asset value. The Sub-Advisor acknowledges and
agrees that the Trust shall have no obligation to the Sub-Advisor to pay any
portion of such fee, which shall be solely the responsibility of LASC. Each such
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78
fee shall be accrued for each calendar day and the sum of the daily fee accruals
shall be paid monthly on or before the tenth day of the following calendar
month. The daily accruals of the fee will be computed by (i) multiplying the
annual percentage rate referred to above by the fraction the numerator of which
is one and the denominator of which is the number of calendar days in the year,
and (ii) multiplying the product obtained pursuant to clause (i) above by the
net asset value of the Fund as determined in accordance with the Trust's
Prospectus as of the previous business day on which the Fund was open for
business. The foregoing fee shall be prorated for any month during which this
Agreement is in effect for only a portion of the month.
6. LIABILITIES OF LASC AND THE SUB-ADVISOR.
A. Except as provided below, in the absence of willful misfeasance, bad faith,
gross negligence, or reckless disregard of obligations or duties hereunder on
the part of LASC or the Sub-Advisor, as the case may be, LASC or the Sub-Advisor
shall not be subject to liability to the Trust or to any shareholder of the
Trust for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security.
B. The Sub-Advisor shall indemnify and hold harmless the Trust from any loss,
cost, expense or damage resulting from the failure of any Portfolio Manager to
comply with (i) any statement included in the Prospectus and Statement of
Additional Information of the Trust, or (ii) instructions given by the
Sub-Advisor to any Portfolio Manager for the purpose of ensuring the Trust's
compliance with securities, tax and other requirements applicable to the Trust's
business and the investment activities of its Funds; provided, however, that the
indemnification provided in this paragraph 6B shall apply only to the extent
that a Portfolio Manager is liable to the Trust and, after demand by the Trust,
is unable or refuses to discharge its obligations to the Trust.
C. No provision of this Agreement shall be construed to protect any Trustee or
officer of the Trust, or the LASC or the Sub-Advisor, as the case may be, from
liability in violation of Sections 17(h) and (i) of the Investment Company Act.
7. EFFECTIVE DATE: TERM. This Agreement shall become effective on the later of
(i) the date first written above or (ii) the date on which the offer and sale of
shares of the Fund has been registered under the Securities Act and the
Investment Company Act pursuant to an effective
B1-21
79
Registration Statement of the Trust on Form N-1A and shall continue until
[ ], and from year to year thereafter, but only so long as such continuance
is specifically approved at least annually by a vote of the Trustees, including
the vote of a majority of the Trustees who are not interested persons of the
Trust, cast in person at a meeting called for the purpose of voting on such
approval, or by vote of a majority of the outstanding voting securities. The
aforesaid provision shall be construed in a manner consistent with the
Investment Company Act and the rules and regulations thereunder.
8. ASSIGNMENT. No assignment of this Agreement shall be made by LASC or the
Sub-Advisor, and this Agreement shall terminate automatically in the event of
any such assignment. Each of LASC and the Sub-Advisor shall notify the Trust in
writing in advance of any proposed change of control with respect to it to
enable the Trust to take the steps necessary to enter into a new advisory
contract.
9. AMENDMENT. This Agreement may be amended at any time, but only by written
agreement between LASC, the Sub-Advisor and the Trust, which is subject to the
approval of the Trustees of the Trust and the shareholders of any affected Fund
in the manner required by the Investment Company Act and the rules thereunder.
10. TERMINATION. This Agreement:
(a) may at any time be terminated without payment of any penalty, by the Trust
(by the Board of Trustees of the Trust or by the vote of a majority of the
outstanding voting securities of the Fund) on sixty (60) days' written notice to
LASC and the Sub-Advisor;
(b) shall immediately terminate in the event of its assignment; and
(c) may be terminated by LASC or the Sub-Advisor on sixty (60) days written
notice to the other parties hereto.
11. DEFINITIONS. As used in this Agreement, the terms "affiliated person,"
"assignment," "control," "interested person" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth in the
Investment Company Act and the rules and regulations thereunder, subject to any
applicable orders of exemption issued by the Securities and Exchange Commission.
B1-22
80
12. NOTICE. Any notice under this Agreement shall be given in writing
addressed and delivered or mailed postpaid to the other party to this Agreement
at its principal place of business.
13. SEVERABILITY. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
14. SHAREHOLDER LIABILITY. Each of LASC and the Sub-Advisor is hereby
expressly put on notice of the limitation of shareholder liability as set forth
in the Declaration of Trust of the Trust and agrees that obligations assumed by
the Trust pursuant to this Agreement shall be limited in all cases to the Trust
and its assets, and if the liability relates to one or more Funds, the
obligations thereunder shall be limited to the respective assets of such Funds.
Each of LASC and the Sub-Advisor further agrees that it shall not seek
satisfaction of any such obligation from the shareholders of the Funds, nor from
the Trustees or any individual Trustee of the Trust.
15. GOVERNING LAW. This Agreement shall be interpreted under, and the
performance of each of LASC and the Sub-Advisor under this Agreement shall be
consistent with, the provisions of the Agreement and Declaration of Trust and
By-Laws of the Trust, the terms of the Investment Company Act, applicable rules
and regulations thereunder, the Code and regulations thereunder, and the Trust's
Prospectus and Statement of Additional Information, in each case as from time to
time in effect. The provisions of this Agreement shall be construed and
interpreted in accordance with the domestic substantive laws of The Commonwealth
of Massachusetts without giving effect to any choice or conflict of laws rules
or provisions that would result in the application of the domestic substantive
laws of any other jurisdiction; provided, however, that if such law or any of
the provisions of this Agreement conflict with the applicable provisions of the
Investment Company Act, the latter shall control.
16. USE OF MANAGER'S NAME. The Trust may use the names [" "] and
[" "] or any other name derived from such names only for so long as this
Agreement (or another similar management agreement with Liberty Financial or a
majority or greater owned subsidiary thereof pertaining to other series funds of
the Trust) or any extension, renewal, or amendment hereof (or thereof) remains
in effect. At such time as this Agreement (and each such other similar
B1-23
81
agreement pertaining to such other series funds) or any extension, renewal or
amendment hereof (or thereof), or each such other similar successor organization
agreement shall no longer be in effect, the Trust will cease to use any name
derived from any such names similar thereto, or any other name indicating that
it is managed by or otherwise connected with the Manager, or with any
organization which shall have succeeded to Manager's business as investment
advisor or manager.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have duly executed this agreement on the
date first above written.
LIBERTY VARIABLE INVESTMENT TRUST,
on its own behalf and on behalf of [ ], Variable Series.
By:
------------------------------------
Title:
LIBERTY ADVISORY SERVICES CORP.
By:
------------------------------------
Title:
[ ]
By:
------------------------------------
Title:
B1-24
82
FORM OF INVESTMENT ADVISORY AGREEMENT
[VARIATION 3 OF 3 -- APPLICABLE TO ALL SRVIT FUNDS]
STEINROE VARIABLE INVESTMENT TRUST
[ ] FUND, VARIABLE SERIES
FUND ADVISORY AGREEMENT
FUND ADVISORY AGREEMENT dated [ ], 2001 between STEINROE VARIABLE
INVESTMENT TRUST, a business trust organized under the laws of the Commonwealth
of Massachusetts (the "Trust"), on behalf of the [ ] Fund, Variable
Series (the "Fund"), and STEIN ROE & FARNHAM INCORPORATED, a corporation
organized under the laws of the State of Delaware (the "Investment Adviser").
WHEREAS, the Trust has been organized as an open-end management investment
company registered as such under the Investment Company Act of 1940 ("Investment
Company Act") and is authorized to issue shares of beneficial interest in one or
more separate series each representing interests in a separate portfolio of
securities and other assets, including the Fund, which shares are to be issued
and sold to and held by various separate accounts of insurance companies
("Participating Insurance Company");
WHEREAS, the Trust desires the Investment Adviser to render investment
management services to the Fund in the manner and on the terms and conditions
hereinafter set forth;
WHEREAS, the Trust is entering into a Fund Administration Agreement (the
"Administration Agreement") of even date herewith with Stein Roe & Farnham
Incorporated (the "Administrator") providing for certain administrative services
to the Trust other than investment management services;
WHEREAS, the Investment Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940 and as a commodities trading advisor under the
Commodity Exchange Act, and desires to provide services to the Fund in
consideration of and on the terms and conditions hereinafter set forth;
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83
NOW, THEREFORE, the Trust, on behalf of the Fund, and the Investment Adviser
agree as follows:
1. Employment of the Investment Adviser. The Trust hereby engages the
Investment Adviser to manage the investment and reinvestment of the Trust's
assets represented by Fund shares ("Fund assets" or "assets of the Fund") and to
advise with respect thereto for the period, in the manner, and on the terms
hereinafter set forth. The Investment Adviser hereby accepts such engagement and
agrees during such period to render the services and to assume the obligations
herein set forth. The Investment Adviser shall for all purposes herein be deemed
to be an independent contractor and shall, except as expressly provided or
authorized (whether herein or otherwise), have no authority to act for or
represent the Trust or the Fund in any way or otherwise be deemed an agent of
the Trust or the Fund.
2. Management Services. (a) The Investment Adviser will manage and supervise
the investment and reinvestment of the assets of the Fund and advise with
respect thereto, subject to the direction and overall control of the Board of
Trustees of the Trust and giving due consideration to the investment objective
of the Fund and the investment policies and investment restrictions of and the
other statements concerning the Fund set forth from time to time in the Trust's
then current prospectus and statement of additional information and other
governing documents, and to the provisions of the Internal Revenue Code and
regulations thereunder applicable to the Fund as a regulated investment company
and as the designated investment vehicle for variable annuity, endowment, or
life insurance contracts. In furtherance of its duties set forth above, the
Investment Adviser is authorized on behalf of the Fund (i) to buy, sell,
exchange, convert, lend and otherwise trade in the Fund's portfolio securities
and assets, and (ii) to place orders for the execution of transactions in the
Fund's portfolio securities with or through such brokers, dealers, underwriters
or issuers as the Investment Adviser may select, and to negotiate the terms of
such transactions, including brokerage commissions on brokerage transactions,
all in accordance with the Trust's policies concerning allocation of its
portfolio brokerage, as permitted by law including but not limited to Section
28(e) of the Securities Exchange Act of 1934, and with the statements concerning
the allocation of orders for the purchase and sale of securities among the Fund
and other accounts of the Investment Adviser set forth from time to time in the
Trust's then current
B1-26
84
prospectus and statement of additional information, and in doing so the
Investment Adviser shall not be required to make any reduction of its investment
advisory fee hereunder.
(b) The Investment Adviser shall provide to the Trust and the Administrator
such information, records and reports concerning the Investment Adviser and its
investment management of the Fund's portfolio securities pursuant hereto as the
Trust and the Administrator may reasonably request.
(c) The Investment Adviser will preserve for the Trust all records it maintains
for the Trust as prescribed by the rules and regulations of the Securities and
Exchange Commission in the manner and for the time periods prescribed by such
rules. The Investment Adviser agrees that all such records shall be the property
and under the control of the Trust and shall be made available, within seven
business days of request therefor, to the Trust's Board of Trustees or auditors
during regular business hours at the Investment Adviser's offices. In the event
of termination of this Agreement for any reason, all such records shall be
returned, without charge, promptly to the Trust, free from any claim or
retention of rights by the Investment Adviser, except that the Investment
Adviser may retain copies of such records.
(d) The Investment Adviser will report to the Trustees of the Trust any
potential or existing material irreconcilable conflict among the interests of
shareholders (the separate accounts of insurance companies investing in the
Trust) of which it is aware. The Investment Adviser will assist the Trustees in
carrying out their responsibilities under an Order from the SEC, dated July 1,
1988, granting insurance companies and variable annuity and variable life
insurance separate accounts exemptions from the provisions of Sections 9(a),
13(a), l5(a), and l5(b) of the Investment Company Act and Rules 6e-2(b)(15) and
6e-3(T)(b)(15) thereunder, to the extent necessary to permit shares of the Trust
to be sold to and held by variable annuity and variable life insurance separate
accounts of insurance companies affiliated and unaffiliated with each other. The
Investment Adviser shall provide the Trustees with all information reasonably
necessary for the Trustees to consider any issues raised.
(e) The Investment Adviser will not disclose or use any records or information
obtained pursuant to this Agreement in any manner whatsoever except as expressly
authorized herein, and will keep
B1-27
85
confidential any information obtained pursuant to this Agreement, and disclose
such information only if the Trust has authorized such disclosure, or if such
disclosure is expressly required by applicable federal or state regulatory
authorities.
3. Expenses Borne by Investment Adviser. To the extent necessary to perform
its obligations under this Agreement, the Investment Adviser, at its own
expense, shall furnish executive and other personnel and office space, equipment
and facilities, and shall pay any other expenses incurred by it, in connection
with the performance of its duties hereunder. The Investment Adviser shall pay
all salaries, fees and expenses of Trustees or officers of the Trust who are
employees of the Investment Adviser. The Investment Adviser shall not be
obligated to bear any other expenses incidental to the operations and business
of the Trust. The Investment Adviser shall not be required to pay or provide any
credit for services provided by the Trust's custodian, transfer agent or other
agents, including the Administrator.
4. Expenses Borne by the Trust and Fund. The Trust or the Fund, as
appropriate, shall pay all expenses incidental to the operations and business of
the Trust and the Fund not specifically assumed or agreed to be paid by the
Investment Adviser or the Administrator pursuant to this Agreement or the
Administration Agreement, or by any Participating Insurance Company, including,
without limitation:
(a) the fees of the Investment Adviser as provided in Section 5 below, and of
the Administrator;
(b) fees payable pursuant to any plan adopted by the Trust pursuant to Rule
12b-1 under the Investment Company Act;
(c) all fees and charges of depositories, custodians, and other agencies for
the safekeeping and servicing of the cash, securities, and other property of the
Trust;
(d) all fees and charges of transfer, shareholder servicing, shareholder record
keeping and dividend disbursing agents and all other expenses relating to the
issuance and redemption of shares of the Trust (including the shares of the
Fund) and the maintenance and servicing of shareholder accounts;
(e) all charges for equipment or services used for obtaining price quotations
or for communication among the Investment Adviser, any sub-adviser appointed by
the Trust, the Administrator, the Trust or any
B1-28
86
Participating Insurance Company, the custodian or any sub-custodian, transfer
agent or any other agent selected by the Trust or the Fund;
(f) all expenses incurred in periodic calculations of the net asset value of
the shares of the Trust (including the shares of the Fund);
(g) all charges for bookkeeping, accounting and tax information services
provided to the Trust by the custodian or any subcustodian;
(h) all charges for services of the Trust's independent auditors;
(i) all charges and expenses of legal counsel for the Trust and for the
Trustees of the Trust in connection with legal matters relating to the Trust or
the Fund;
(j) all compensation of the Trustees of the Trust other than those Trustees who
are interested persons of the Trust including, without limitation, Trustees who
are interested persons of the Investment Adviser, the Administrator or any
Participating Insurance Company, or the principal underwriter of the Trust, and
all expenses (including expenses incident to Trustees' meetings) incurred in
connection with their services to the Trust;
(k) all expenses of preparation, printing and mailing of notices and proxy
solicitation material and of reports and other communications to the
shareholders and beneficial owners of the Trust, and all other expenses
(including proxy solicitation expenses) incidental to meetings of the
shareholders or beneficial owners of the Trust;
(1) all expenses of preparation (including type setting) and printing of annual
or more frequent revisions of the Trust's prospectuses and statements of
additional information and supplements thereto, of supplying each then-existing
shareholder or beneficial owner of shares of the Fund or purchaser thereof with
a copy of such revised prospectus or SAI supplements, and of supplying copies of
such statements of additional information to persons requesting the same;
(m) all expenses, if any, related to preparing, printing and engraving and
transmitting certificates representing shares of the Trust;
(n) all expenses of bond and insurance coverage required by law or deemed
advisable by the Board of Trustees;
(o) all brokers' commissions and other normal charges incident to the purchase
and sale of portfolio securities;
B1-29
87
(p) costs, including interest expense, of borrowing money;
(q) all taxes and corporate fees payable to federal, state or other
governmental agencies, domestic or foreign, and all costs and expenses incident
to the maintenance of the Trust's legal existence;
(r) all expenses of registering and maintaining the registration of the Trust
under the Investment Company Act and the shares of the Trust under the
Securities Act of 1933, and all expenses, if any, of qualifying and maintaining
the qualification of the shares of the Trust for sale under securities laws of
various states or other jurisdictions and of registration and qualification of
the Trust under all other laws applicable to the Trust or its business
activities;
(s) all fees, dues, and other expenses incurred by the Trust in connection with
its membership in any trade association or other investment organization; and
(t) all miscellaneous business expenses.
The Trust or the Fund, as appropriate, shall also bear all extraordinary
non-recurring expenses as may arise, including but not limited to expenses
incurred in connection with litigation, proceedings and claims and expenses
incurred in connection with any obligation of the Trust or the Fund to indemnify
any person.
Expenses which are directly charged to or attributable to the Fund or any other
Fund of the Trust shall be borne by that Fund, and expenses which are not solely
attributable to any one Fund of the Trust shall be allocated among the Funds of
the Trust on a basis that the Trustees of the Trust deem fair and equitable.
5. Investment Advisory Fee. For the services to be rendered by the Investment
Adviser hereunder, the Trust, for the benefit of the Fund, shall pay the
Investment Adviser out of Fund assets an annual fee in the amount shown in
Schedule A attached hereto and made a part hereof.
6. Non-Exclusivity. The services of the Investment Adviser to the Fund
hereunder are not to be deemed exclusive and the Investment Adviser shall be
free to render similar services to others.
7. Standard of Care. Neither the Investment Adviser, nor any of its directors,
officers or stockholders (or partners of stockholders), agents or employees
shall be liable or responsible to the Trust or the Fund or their shareholders
(or the beneficial owners of their shares) for any error of
B1-30
88
judgment, mistake of law or any loss arising out of any investment, or for any
other act or omission in the performance by the Investment Adviser of its duties
under this Agreement, except for liability resulting from willful misfeasance,
bad faith or gross negligence on the Investment Adviser's part or from reckless
disregard by the Investment Adviser of its obligations and duties under this
Agreement.
8. Amendment. This Agreement may be amended at any time by a written agreement
executed by both parties hereto, provided that with respect to amendments of
substance such execution on behalf of the Fund shall have been approved by the
vote of a majority of the outstanding voting securities of the Fund and by the
vote of a majority of those Trustees who are not interested persons of the
Trust, the Investment Adviser, the Administrator or a Participating Insurance
Company cast in person at a meeting called for the purpose of voting on such
approval.
9. Term and Termination. This Agreement shall begin on the date first written
above, and may be terminated at any time, without payment of any penalty, by the
Board of Trustees of the Trust, or by the vote of a majority of the outstanding
voting securities of the Fund, upon sixty (60) days' written notice to the
Investment Adviser. This Agreement may be terminated by the Investment Adviser
at any time upon sixty 60 days' written notice to the Trust. This Agreement
shall terminate automatically in the event of its assignment. Unless terminated
as hereinabove provided, this Agreement shall continue in effect until
[ ], and thereafter from year to year only so long as such
continuance is specifically approved at least annually in conformity with the
requirements of the Investment Company Act and the rules and regulations
thereunder (a) by the vote of a majority of those Trustees who are not parties
to this Agreement or interested persons of the Trust, the Investment Adviser,
the Administrator or a Participating Insurance Company, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by either the
Board of Trustees of the Trust or by the vote of a majority of the outstanding
voting securities of the Fund.
10. Non-Liability of Trustees and Shareholders. As provided in the Declaration
of Trust of the Trust, a copy of which is on file with the Secretary of the
Commonwealth of Massachusetts, any obligation of the Trust or the Fund hereunder
shall be binding only upon the assets and property of the Trust or the Fund, as
the case may be, and shall not be
B1-31
89
binding upon any Trustee, officer, employee, agent or shareholder (or beneficial
owner of shares) of the Trust, including, without limitation, the officer of the
Trust executing this Agreement on its behalf. Neither the authorization of any
action by the Trustees or shareholders (or beneficial owners of shares) of the
Trust nor the execution of this Agreement on behalf of the Trust shall impose
any liability upon any Trustee or any shareholder (or beneficial owner of
shares).
11. Use of Investment Adviser's Name. The Trust may use the name "SteinRoe
Variable Investment Trust" or any other name derived from the name "Stein Roe &
Farnham" only for so long as this Agreement or any extension, renewal, or
amendment hereof remains in effect, including any similar agreement with any
organization which shall have succeeded to the business of the Investment
Adviser. At such time as this Agreement or any extension, renewal or amendment
hereof, or such other similar agreement shall no longer be in effect, the Trust
will cease to use any name derived from the name "Stein Roe & Farnham," any name
similar thereto, or any other name indicating that it is advised by or otherwise
connected with Investment Adviser, or with any organization which shall have
succeeded to Investment Adviser's business as investment adviser.
12. Definitions, References and Headings. As used in this Agreement, the terms
"vote of a majority of the outstanding voting securities", "interested person",
"principal underwriter" and "assignment" shall have the respective meanings
provided in the Investment Company Act and the rules thereunder, subject,
however, to such exemptions or no-action responses as may be granted by the
Securities and Exchange Commission under said Act. Headings are placed herein
for convenience of reference only and shall not be taken as a part hereof or
control or affect the meaning, construction or effect of this Agreement.
13. Interpretation; Governing Law. This Agreement shall be interpreted under,
and the performance of the Investment Adviser under this Agreement shall be
consistent with, the provisions of the Agreement and Declaration of Trust and
By-Laws of the Trust, as in effect from time to time, the terms of the
Investment Company Act, other applicable laws and regulations thereunder
(including any amendments hereafter adopted), the Internal Revenue Code of 1986,
and regulations thereunder, and the Trust's prospectus and statement of
additional information. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of Illinois (except Section 10 hereof
which
B1-32
90
shall be construed and interpreted in accordance with the laws of
Massachusetts), without giving effect to the conflict of laws provisions
thereof, provided, however, that if such law or any of the provisions of this
Agreement conflict with the applicable provisions of the Investment Company Act,
the latter shall control.
14. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, a statute, a rule, or otherwise, the remainder of
this Agreement shall not be affected thereby.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have duly executed this agreement on the
date first above written.
[ ] FUND, VARIABLE SERIES
STEINROE VARIABLE INVESTMENT TRUST
By:
- ---------------------------------
STEIN ROE & FARNHAM INCORPORATED
By:
- ---------------------------------
B1-33
91
SCHEDULE A
Fund Advisory Agreement
[ ] Fund, Variable Series
The annual investment advisory fee referred to in paragraph 5 of this Agreement
shall be [ ]% of the net asset value of the Fund, computed as hereinafter
provided. The fee shall be accrued for each calendar day and the sum of the
daily fee accruals shall be paid monthly on or before the tenth day of the
following calendar month. The daily accruals of the fee will be computed by
multiplying the annual rate referred to above by the fraction the numerator of
which is one and the denominator of which is the number of calendar days in the
year, and multiplying such product by the net asset value of the Fund as
determined in accordance with the Fund's prospectus as of the previous business
day on which the Fund was open for business. The foregoing fee shall be prorated
for any month during which this Agreement is in effect for only a portion of the
month.
B1-34
92
APPENDIX B2
NOTE: THE SUB-ADVISORY AGREEMENTS FOR LIBERTY ALL-STAR EQUITY FUND, VARIABLE
SERIES, LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES, RYDEX FINANCIAL SERVICES
FUND, VARIABLE SERIES AND RYDEX HEALTH CARE FUND, VARIABLE SERIES ARE PART OF
THE ADVISORY AGREEMENTS FOR THESE FUNDS. PLEASE REFER TO APPENDIX B1.
NOTE: BRACKETED TEXT APPEARS ONLY IN THE SUB-ADVISORY AGREEMENTS WITH THE FUNDS
INDICATED.
FORM OF SUB-ADVISORY AGREEMENT
[VARIATION 1 OF 3 -- APPLICABLE TO ALL LVIT FUNDS EXCEPT LIBERTY ALL-STAR EQUITY
FUND, VARIABLE SERIES, LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES, LIBERTY
VALUE FUND, VARIABLE SERIES, RYDEX FINANCIAL SERVICES FUND, VARIABLE SERIES,
RYDEX HEALTH CARE FUND, VARIABLE SERIES AND STEIN ROE GLOBAL UTILITIES FUND,
VARIABLE SERIES]
[ ] FUND,
VARIABLE SERIES
[ ] SUB-ADVISORY AGREEMENT
AGREEMENT dated [ ], 2001 among LIBERTY VARIABLE INVESTMENT TRUST, a
Massachusetts business trust (the "Trust"), with respect to [ ] FUND,
VARIABLE SERIES (the "Fund"), LIBERTY ADVISORY SERVICES, a Massachusetts
corporation ("'Advisor"), and [ ], a [ ] corporation (the "Sub-Advisor").
In consideration of the promises and covenants herein, the parties agree as
follows:
1. The Sub-Advisor will manage the investment of the assets of the Fund in
accordance with its investment objective, policies and limitations set forth in
the Trust's prospectus and statement of additional information. as amended from
time to time, and will perform the other services herein set forth, subject to
the supervision of the Advisor and the Board of Trustees of the Trust
B2-1
93
2. In carrying out its investment management obligations, the Sub-Advisor
shall:
(a) evaluate such economic, statistical and financial information and
undertake such investment research as it shall believe advisable:
(b) purchase and sell securities and other investments for the Fund in
accordance with the procedures described in the Trust's prospectus and statement
of additional information: and
(c) report results to the Advisor and to the Board of Trustees.
[FOR COLONIAL INTERNATIONAL FUND FOR GROWTH, VARIABLE SERIES, COLONIAL STRATEGIC
INCOME FUND, VARIABLE SERIES AND COLONIAL U.S. GROWTH & INCOME FUND, VARIABLE
SERIES ONLY:
3. The Sub-Advisor may delegate its investment responsibilities under
paragraph 2(b) with respect to the Fund to one or more Persons or companies
registered as investment advisors under the Investment Adviser's Act of 1940, as
amended, or qualifying as a "bank" within the meaning of such Act and thereby
exempted from the requirement to be so registered ("Second-Tier Sub-Advisors"),
pursuant to an agreement among the Trust, such Fund, the Advisor, the
Sub-Advisor and such Second-Tier Sub-Advisor ("Second-Tier Sub-Advisory
Agreement") Each Second-Tier Sub-Advisory Agreement may provide that the
Second-Tier Sub-Advisor. subject to the control and supervision of the Trustees,
the Advisor and the Sub-Advisor. shall have full investment discretion for the
Fund and the Fund's assets or any portion thereof specified by the Sub-Advisor.
Any selection of duties pursuant to this paragraph shall comply with any
applicable provisions of Section 15 of the Investment Company Act of 1940, as
amended (the "1940 Act"), except to the extent permitted by any applicable
exemptive order of the Securities and Exchange Commission or similar relief, The
Sub-Advisor shall be solely responsible for paying the fees of each Second-Tier
Sub-Advisor from the fees it collects as provided in paragraph 5 below.]
4. The Sub-Advisor shall be free to render similar services to others so long
as its services hereunder are not impaired thereby.
5. The Advisor shall pay the Sub-Advisor a monthly fee at the annual rate of
[ ]% of the average daily net assets of the Fund for managing the investment
of the assets of the Fund as provided in paragraph 1
B2-2
94
above. Such fee shall be paid in arrears on or before the 10th day of the next
following calendar month.
6. This Agreement shall become effective on the date first written above and
(a) unless otherwise terminated, shall continue until [ ], and from year
to year thereafter so long as approved annually in accordance with the 1940 Act:
(b) may be terminated without penalty on sixty days' written notice to the
Sub-Advisor either by vote of the Board of Trustees of the Trust or by vote of a
majority of the outstanding voting securities of the Fund: (c) shall
automatically terminate in the event of its assignment; and (d) may be
terminated without penalty by the Sub-Advisor on sixty days' written notice to
the Trust.
7. This Agreement may be amended in accordance with the 1940 Act.
8. For the purpose of the Agreement, the terms "vote of a majority of the
outstanding shares, "affiliated person" and "assignment" shall have their
respective meanings defined in the 1940 Act and exemptions and interpretations
issued by the Securities and Exchange Commission under the 1940 Act.
9. In the absence of willful misfeasance, bad faith or gross negligence on the
part of the Sub-Advisor, or reckless disregard of its obligations and duties
hereunder, the Sub-Advisor shall not be subject to any liability to the Trust or
the Fund, to any shareholder of the Trust or the Fund or to any other person.
firm or organization, for any act or omission in the course or connection with
rendering services hereunder.
10. The Fund may use the name "[ ]," or any other name derived from the
name "[ ]," only for so long as this Agreement or any extension,
renewal, or amendment hereof remains in effect, including any similar agreement
with any organization that shall have succeeded to the business of the
Sub-Advisor. At such time as this Agreement or any extension, renewal or
amendment hereof, or each such other similar successor organization agreement
shall no longer be in effect, the Fund will cease to use any name derived from
the name "[ ]," any name similar thereto, or any other name indicating
that it is advised by or otherwise connected with the Sub-Advisor, or with any
organization which shall have succeeded to the Sub-Advisor's business as an
investment advisor.
B2-3
95
11. The Sub-Advisor is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Declaration of Trust of the Trust and
agrees that obligations assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the assets of the Fund. The Sub-Advisor further agrees
that it shall not seek satisfaction of any such obligation from the shareholders
of the Fund, nor from the Trustees or any individual Trustee of the Trust.
[ ] FUND, VARIABLE SERIES
By: LIBERTY VARIABLE INVESTMENT TRUST
By:
------------------------------------
[ ]
By:
------------------------------------
LIBERTY ADVISORY SERVICES CORP.
By:
------------------------------------
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96
FORM OF SUB-ADVISORY AGREEMENT
[VARIATION 2 OF 3 -- APPLICABLE TO LIBERTY VALUE FUND, VARIABLE SERIES AND STEIN
ROE GLOBAL UTILITIES FUND, VARIABLE SERIES]
[ ] FUND, VARIABLE SERIES
[ ] SUB-ADVISORY AGREEMENT
AGREEMENT date [ ], 2001 among LIBERTY VARIABLE INVESTMENT TRUST, a
Massachusetts business trust (the "Trust"), with respect to [ ]
FUND, VARIABLE SERIES (the "Fund"), LIBERTY ADVISORY SERVICES CORP., a
Massachusetts corporation ("Adviser"), and [ ], a [ ]
corporation (the "Sub-Adviser").
In consideration of the promises and covenants herein, the parties agree as
follows:
1. The Sub-Adviser will manage the investment of the assets of the Fund in
accordance with its investment objective, policies and limitations set forth in
the Trust's prospectus and statement of additional information, as amended from
time to time, and will perform the other services herein set forth, subject to
the supervision of the Adviser and the Board of Trustees of the Trust.
2. In carrying out its investment management obligations, the Sub-Adviser
shall:
(a) evaluate such economic, statistical and financial information and undertake
such investment research as it shall believe advisable;
(b) purchase and sell securities and other investments for the Fund in
accordance with the procedures described in the Trust's prospectus and statement
of additional information; and
(c) report results to the Adviser and to the Board of Trustees.
3. The Sub-Adviser shall be free to render similar services to others so long
as its services hereunder are not impaired thereby.
4. The Advisor shall pay the Sub-Adviser a monthly fee at the annual rate of
[ ]% of the average daily net assets of the Fund for managing the investment
of the assets of the Fund as provided in paragraph 1 above.
B2-5
97
5. This Agreement shall become effective on the date first written above, and
(a) unless otherwise terminated, shall continue until [ ], and from year
to year thereafter so long as approved annually in accordance with the
Investment Company Act of 1940 (the "1940 Act"); (b) may be terminated without
penalty on sixty days' written notice to the Sub-Adviser either by vote of the
Board of Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Fund; (c) shall automatically terminate in the event of
its assignment; and (d) may be terminated without penalty by the Sub-Adviser on
sixty day's written notice to the Trust.
6. This Agreement may be amended in accordance with the 1940 Act.
7. For the purpose of the Agreement, the terms "vote of a majority of the
outstanding shares," "affiliated person" and "assignment" shall have their
respective meanings defined in the 1940 Act and exemptions and interpretations
issued by the Securities and Exchange Commission under the 1940 Act.
8. In the absence of willful misfeasance, bad faith or gross negligence on the
part of the Sub-Adviser, or reckless disregard of its obligations and duties
hereunder, the Sub-Adviser shall not be subject to any liability to the Trust or
the Fund, to any shareholder of the Trust or the Fund or to any other person,
firm or organization, for any act or omission in the course of or connection
with rendering services hereunder.
9. The Fund may use the name "[ ]," or any other name derived from
the name "[ ]," only for so long as this Agreement or any
extension, renewal, or amendment hereof remains in effect, including any similar
agreement with any organization that shall have succeeded to the business of the
Sub-Adviser. At such time as this Agreement or any extension, renewal or
amendment hereof, or such other similar agreement shall no longer be in effect,
the Fund will cease to use any name derived from the name "[ ],"
any name similar thereto, or any other name indicating that it is advised by or
otherwise connected with the Sub-Adviser, or with any organization
B2-6
98
which shall have succeeded to the Sub-Adviser's business as an investment
adviser.
[ ] FUND,
VARIABLE SERIES
By: LIBERTY VARIABLE INVESTMENT TRUST
By:
------------------------------------------------------
[ ]
By:
------------------------------------------------------
LIBERTY ADVISORY SERVICES CORP.
By:
------------------------------------------------------
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99
FORM OF SUB-ADVISORY AGREEMENT
[VARIATION 3 OF 3 - APPLICABLE TO STEIN ROE BALANCED FUND, VARIABLE SERIES]
SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT, dated this [ ] day of [ ], 2001, among STEIN
ROE & FARNHAM INCORPORATED, a Delaware corporation (the "Adviser"), NORDEA
SECURITIES, INC. (formerly UNIBANK SECURITIES, INC.), d/b/a "NORDEA INVESTMENT
MANAGEMENT," a company incorporated under the laws of the State of Delaware (the
"Sub-Adviser") and STEINROE VARIABLE INVESTMENT TRUST (the "Trust"), on behalf
of Stein Roe Balanced Fund, Variable Series (the "Fund").
WITNESSETH:
WHEREAS, the Adviser provides the Fund, a series of the Trust, an open-end
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), business services pursuant to the terms and conditions
of an investment advisory agreement dated [ ], 2001 as amended (the
"Advisory Agreement"), between the Adviser and the Trust, on behalf of the Fund;
and
WHEREAS, the Sub-Adviser is willing to provide services to the Adviser on the
terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the
parties hereto as herein set forth, the parties covenant and agree as follows:
1. DUTIES OF THE SUB-ADVISER. Subject to the supervision of the Trustees of
the Trust and the Adviser, the Sub-Adviser will: (a) manage the investment of a
portion of the assets of the Fund, as determined by the Adviser, in accordance
with the Fund's investment objectives, policies and limitations as stated in the
Fund's then current Prospectus (the "Prospectus") and Statement of Additional
Information (the "Statement"), and in compliance with the 1940 Act and the
rules, regulations and orders thereunder; (b) place purchase and sale orders for
portfolio transactions for the Fund; (c) evaluate such economic, statistical and
financial information and undertake such investment research as it shall believe
advisable; (d) employ professional portfolio managers to provide research
services to the Fund; and (e) report results
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100
to the Board of Trustees of the Trust. The Adviser agrees to provide the
Sub-Adviser with such assistance as may be reasonably requested by the
Sub-Adviser in connection with its activities under this Agreement, including,
without limitation, information concerning the Portfolio, its funds available,
or to become available, for investment and generally as to the conditions of the
Fund's affairs.
Should the Trustees of the Trust or the Adviser at any time make any
determination as to investment policy and notify the Sub-Adviser thereof in
writing, the Sub-Adviser shall be bound by such determination for the period, if
any, specified in such notice or until notified that such determination has been
revoked. Further, the Adviser or the Trustees of the Trust may at any time, upon
written notice to the Sub-Adviser, suspend or restrict the right of the
Sub-Adviser to determine what assets of the Fund shall be purchased or sold and
what portion, if any, of the Fund's assets shall be held uninvested. It is
understood that the Adviser undertakes to discuss with the Sub-Adviser any such
determinations of investment policy and any such suspension or restrictions on
the right of the Sub-Adviser to determine what assets of the Fund shall be
purchased or sold or held uninvested, prior to the implementation thereof.
2. CERTAIN INFORMATION TO THE SUB-ADVISER. Copies of the Prospectus and the
Statement have been delivered to the Sub-Adviser. The Adviser agrees to notify
the Sub-Adviser of each change in the investment policies of the Fund and to
provide to the Sub-Adviser as promptly as practicable copies of all amendments
and supplements to the Prospectus and the Statement. In addition, the Adviser
will promptly provide the Sub-Adviser with any procedures applicable to the
Sub-Adviser adopted from time to time by the Trustees of the Trust and agrees to
provide promptly to the Sub-Adviser copies of all amendments thereto.
3. EXECUTION OF CERTAIN DOCUMENTS. Subject to any other written instructions
of the Adviser and the Trustees of the Trust, the Sub-Adviser is hereby
appointed the Adviser's and the Trust's agent and attorney-in-fact to execute
account documentation, agreements, contracts and other documents as the
Sub-Adviser shall be requested by brokers, dealers, counterparties and other
persons in connection with its management of the assets of the Fund.
4. REPORTS. The Sub-Adviser shall furnish to the Trustees of the Trust or the
Adviser, or both, as may be appropriate, quarterly reports of its activities on
behalf of the Fund, as required by applicable law or as
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101
otherwise requested from time to time by the Trustees of the Trust or the
Adviser, and such additional information, reports, evaluations, analyses and
opinions as the Trustees of the Trust or the Adviser, as appropriate, may
request from time to time.
5. COMPENSATION OF THE SUB-ADVISER. For the services to be rendered by the
Sub-Adviser under this Agreement, the Adviser shall pay to the Sub-Adviser
compensation, computed and paid monthly in arrears in U.S. dollars, at an annual
rate of 0.40% of the average daily net asset value of the portion of the Fund's
assets under management by the Sub-Adviser. If the Sub-Adviser shall serve for
less than the whole of any month, the compensation payable to the Sub-Adviser
with respect to the Fund will be prorated. The Sub-Adviser will pay its expenses
incurred in performing its duties under this Agreement. Neither the Trust nor
the Fund shall be liable to the Sub-Adviser for the compensation of the
Sub-Adviser. For the purpose of determining fees payable to the Sub-Adviser, the
value of the Fund's net assets shall be computed at the times and in the manner
specified in the Prospectus and/or Statement.
6. LIMITATION OF LIABILITY OF THE SUB-ADVISER. The Sub-Adviser shall not be
liable for any error of judgment or mistake of law or for any loss arising out
of any investment or for any act or omission in the execution and management of
the Fund, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties and obligations hereunder. The Trust, on behalf of the
Fund, may enforce any obligations of the Sub-Adviser under this Agreement and
may recover directly from the Sub-Adviser for any liability it may have to the
Fund.
7. ACTIVITIES OF THE SUB-ADVISER. The services of the Sub-Adviser to the Fund
are not deemed to be exclusive, the Sub-Adviser being free to render investment
advisory and/or other services to others.
8. COVENANTS OF THE SUB-ADVISER. The Sub-Adviser agrees that it (a) will not
deal with itself, "affiliated persons" of the Sub-Adviser, the Trustees of the
Trust or the Fund's distributor, as principals, agents, brokers or dealers in
making purchases or sales of securities or other property for the account of the
Fund, except as permitted by the 1940 Act and the rules, regulations and orders
thereunder and subject to the prior written approval of the Adviser, and except
in accordance with Rule 17e-1 procedures as approved by the Trustees from time
to time and (b) will comply with all other provisions of the then-current
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102
Prospectus and Statement relative to the Sub-Adviser and its trustees, officers,
employees and affiliates.
9. REPRESENTATIONS, WARRANTIES AND ADDITIONAL AGREEMENTS OF THE SUB-
ADVISER. The Sub-Adviser represents, warrants and agrees that:
(a) It (i) is registered as an investment adviser under the U.S. Investment
Advisers Act of 1940 (the "Advisers Act"), is authorized to undertake investment
business in the U.S. and is registered under the laws of any jurisdiction in
which the Sub-Adviser is required to be registered as an investment adviser in
order to perform its obligations under this Agreement, and will continue to be
so registered for so long as this Agreement remains in effect; (ii) is not
prohibited by the 1940 Act or the Advisers Act from performing the services
contemplated by this Agreement; (iii) has met, and will continue to meet for so
long as this Agreement remains in effect, any other applicable Federal or State
requirements, or the applicable requirements of any regulatory or industry
self-regulatory agency, necessary to be met in order to perform the services
contemplated by this Agreement; (iv) has the authority to enter into and perform
the services contemplated by this Agreement; (v) will immediately notify the
Adviser in writing of the occurrence of any event that would disqualify the
Sub-Adviser from serving as an investment adviser of an investment company
pursuant to Section 9(a) of the 1940 Act or otherwise; and (vi) will immediately
notify the Adviser in writing of any change of control of the Sub-Adviser or any
parent of the Sub-Adviser resulting in an "assignment" of this Agreement.
(b) It will maintain, keep current and preserve on behalf of the Fund, in the
manner and for the periods of time required or permitted by the 1940 Act and the
rules, regulations and orders thereunder and the Advisers Act and the rules,
regulations and orders thereunder, records relating to investment transactions
made by the Sub-Adviser for the Fund as may be reasonably requested by the
Adviser or the Fund from time to time. The Sub-Adviser agrees that such records
are the property of the Fund, and will be surrendered to the Fund promptly upon
request.
(c) The Sub-Adviser has adopted a written code of ethics complying with the
requirements of Rule 17j-1 under the 1940 Act and, if it has not already done
so, will provide the Adviser and the Trust with a copy of such code of ethics,
and upon any amendment to such code of ethics, promptly provide such amendment.
At least annually the Sub-Adviser
B2-11
103
will provide the Trust and the Adviser with a certificate signed by the chief
compliance officer (or the person performing such function) of the Sub-Adviser
certifying, to the best of his or her knowledge, compliance with the code of
ethics during the immediately preceding twelve (12) month period, including any
material violations of or amendments to the code of ethics or the administration
thereof.
(d) It has provided the Adviser and the Trust with a copy of its Form ADV as
most recently filed with the Securities and Exchange Commission (the "SEC") and
will, promptly after filing any amendment to its Form ADV with the SEC, furnish
a copy of such amendment to the Adviser and the Trust.
10. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall become
effective on the date first above written and shall govern the relations between
the parties hereto thereafter, and shall remain in force until [ ],
and from year to year thereafter but only so long as its continuance is
"specifically approved at least annually" by the Board of Trustees of the Trust
or by "vote of a majority of the outstanding voting securities" of the Fund.
This Agreement may be terminated at any time without penalty on sixty days'
written notice to the Sub-Adviser by vote of the Board of Trustees of the Trust,
by "vote of a majority of the outstanding voting securities" of the Fund, or by
the Adviser. This Agreement also may be terminated at any time without penalty
by the Sub-Advisor on ninety days' written notice to the Adviser and Trust. This
Agreement shall automatically terminate in the event of its "assignment" or in
the event that the Advisory Agreement shall have terminated for any reason.
11. AMENDMENTS TO THIS AGREEMENT. This Agreement may be amended in accordance
with the 1940 Act.
12. CERTAIN DEFINITIONS. The terms "specifically approved at least annually",
"vote of a majority of the outstanding voting securities", "assignment",
"control", "affiliated persons" and "interested person", when used in this
Agreement, shall have the respective meanings specified, and shall be construed
in a manner consistent with, the 1940 Act and the rules, regulations and orders
thereunder, subject, however, to such exemptions as may be granted by the SEC
under the 1940 Act.
13. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; DUTY TO UPDATE
INFORMATION. All representations and warranties made by the Sub-Adviser
pursuant to Section 9 hereof shall survive for the duration of this
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Agreement and the Sub-Adviser shall immediately notify, but in no event later
than five (5) business days, the Adviser in writing upon becoming aware that any
of the foregoing representations and warranties are no longer true.
14. MISCELLANEOUS. This Agreement shall be governed by and construed in
accordance with the internal laws of The Commonwealth of Massachusetts. All
notices provided for by this Agreement shall be in writing and shall be deemed
given when received, against appropriate receipt, by the Sub-Adviser's Secretary
in the case of the Sub-Adviser, the Adviser's General Counsel in the case of the
Adviser, and the Trust's Secretary in the case of the Fund, or such other person
as a party shall designate by notice to the other parties. This Agreement
constitutes the entire agreement among the parties hereto and supersedes any
prior agreement among the parties relating to the subject matter hereof. The
section headings of this Agreement are for convenience of reference and do not
constitute a part hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered in their names and on their behalf by the undersigned, thereunto duly
authorized, and their respective seals to be hereto affixed, all as of the day
and year first written above.
STEIN ROE & FARNHAM INCORPORATED
By:
------------------------------------
Name:
Title:
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105
NORDEA SECURITIES, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
STEINROE VARIABLE INVESTMENT TRUST, on behalf of
Stein Roe Balanced Fund, Variable Series
By:
------------------------------------
Name:
Title:
A copy of the document establishing the Trust is filed with the Secretary of The
Commonwealth of Massachusetts. This Agreement is executed by officers not as
individuals and is not binding upon any of the Trustees, officers or
shareholders of the Trust individually but only upon the assets of the Fund.
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APPENDIX B3
FORM OF PORTFOLIO MANAGEMENT AGREEMENT
[LVIT -- PORTFOLIO MANAGEMENT AGREEMENT STANDARD FORM]
PORTFOLIO MANAGEMENT AGREEMENT
WITH [ ] PORTFOLIO MANAGER[S]
as of [ ], 2001
[PORTFOLIO MANAGER]
[ADDRESS]
Re Portfolio Management Agreement
Ladies and Gentlemen:
[ ] Fund, Variable Series (the "Fund") is a series of the
Liberty Variable Investment Trust (the "Trust"), a diversified open-end
investment company registered under the Investment Company Act of 1940 (the
"Act"), and is subject to the rules and regulations promulgated thereunder.
Liberty Advisory Services Corp. ("LASC") is the manager of the Fund. Pursuant to
the Management and Sub-Advisory Agreement of even date herewith (the "Management
and Sub-Advisory Agreement") among the Trust, on behalf of the Fund, LASC and
[ ] (the "Fund Manager"), LASC delegates to the Fund Manager
responsibility for investment management of the Fund. In furtherance thereof,
the Fund Manager evaluates and recommends portfolio managers for the Fund and is
responsible for certain administrative matters relating to the Fund.
l. Employment as a Portfolio Manager. The Trust being duly authorized hereby
employs [ ] (the "Portfolio Manager") as a discretionary
portfolio manager, on the terms and conditions set forth herein, of those assets
of the Fund which the Fund Manager determines to assign to the Portfolio Manager
(those assets being referred to as the "Fund Account"). The Fund Manager may,
from time to time, allocate and reallocate the Fund's assets among the Portfolio
Manager and the other portfolio managers of the Fund's assets.
2. Acceptance of Employment; Standard of Performance. The Portfolio Manager
accepts its employment as a discretionary portfolio manager
B3-1
107
and agrees to use its best professional judgment to make timely investment
decisions for the Fund Account in accordance with the provisions of this
Agreement.
3. Portfolio Management Services of Portfolio Manager. In providing portfolio
management services to the Fund Account, the Portfolio Manager shall be subject
to the investment objectives, policies and restrictions of the Fund as set forth
in the Trust's current registration statement under the Act (as the same may be
modified from time to time), and the investment restrictions set forth in the
Act and the Rules thereunder (as and to the extent set forth in such
registration statement or in other documentation furnished to the Portfolio
Manager by the Fund or the Fund Manager), to the supervision and control of the
Trustees of the Trust (the "Trustees"), and to instructions from the Fund
Manager. The Portfolio Manager shall not, without the prior approval of the Fund
or the Fund Manager, effect any transactions which would cause the Fund Account,
treated as a separate fund, to be out of compliance with any of such
restrictions or policies.
4. Transaction Procedures. All portfolio transactions for the Fund Account
will be consummated by payment to or delivery by the custodian of the assets of
the Fund (the "Custodian"), or such depositories or agents as may be designated
by the Custodian in writing, as custodian for the Fund, of all cash and/or
securities due to or from the Fund Account, and the Portfolio Manager shall not
have possession or custody thereof or any responsibility or liability with
respect to such custody. The Portfolio Manager shall advise and confirm in
writing to the Custodian all investment orders for the Fund Account placed by it
with brokers and dealers at the time and in the manner set forth in Schedule A
hereto (as Schedule A may be amended from time to time). The Fund shall issue to
the Custodian such instructions as may be appropriate in connection with the
settlement of any transaction initiated by the Portfolio Manager. The Fund shall
be responsible for all custodial arrangements and the payment of all custodial
charges and fees, and, upon giving proper instructions to the Custodian, the
Portfolio Manager shall have no responsibility or liability with respect to
custodial arrangements or the acts, omissions or other conduct of the Custodian.
5. Allocation of Brokerage. The Portfolio Manager shall have authority and
discretion to select brokers and dealers to execute portfolio transactions
initiated by the Portfolio Manager, and to select the markets on or in which the
transaction will be executed.
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108
A. In doing so, the Portfolio Manager's primary responsibility shall be to seek
to obtain best net price and execution for the Fund. However, this
responsibility shall not obligate the Portfolio Manager to solicit
competitive bids for each transaction or to seek the lowest available
commission cost to the Fund, so long as the Portfolio Manager reasonably
believes that the broker or dealer selected by it can be expected to obtain
a "best execution" market price on the particular transaction and determines
in good faith that the commission cost is reasonable in relation to the
value of the brokerage and research services (as defined in Section 28(e)(3)
of the Securities Exchange Act of 1934) provided by such broker or dealer to
the Portfolio Manager viewed in terms of either that particular transaction
or of the Portfolio Manager's overall responsibilities with respect to its
clients, including the Fund, as to which the Portfolio Manager exercises
investment discretion, notwithstanding that the Fund may not be the direct
or exclusive beneficiary of any such services or that another broker may be
willing to charge the Fund a lower commission on the particular transaction.
B. Subject to the requirements of paragraph A above, the Fund Manager shall
have the right to request that transactions giving rise to brokerage
commissions shall be executed by brokers and dealers (and in amounts), to be
agreed upon from time to time between the Fund Manager and the Portfolio
Manager, that provide brokerage or research services to the Fund or the Fund
Manager, or as to which an on-going relationship will be of value to the
Fund in the management of its assets, which services and relationship may,
but need not, be of direct benefit to the Fund Account. Notwithstanding any
other provision of this Agreement, the Portfolio Manager shall not be
responsible under paragraph A above with respect to transactions executed
through any such broker or dealer.
C. The Portfolio Manager shall not execute any portfolio transactions for the
Fund Account with itself or any broker or dealer which is an "affiliated
person" (as defined in the Act) of the Fund, the Portfolio Manager or any
other Portfolio Manager of the Fund without the prior written approval of
the Fund except in accordance with SEC Exemptive Order No. 24288 dated
February 15, 2000, a copy of which has been furnished to the Portfolio
Manager, and Rule 17e-1 procedures as approved by the Fund's Trustees from
time to time. The Fund will provide the Portfolio Manager with a list of
brokers
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and dealers which are "affiliated persons" of the Fund or its Portfolio
Managers.
6. Proxies. The Portfolio Manager will vote all proxies solicited by or with
respect to the issuers of securities in which assets of the Fund Account may be
invested in accordance with authorization provided by the Fund Manager from time
to time.
7. Fees for Services. As its compensation for its services under this
Agreement, the Fund Manager will pay the Portfolio Manager monthly in arrears a
fee at an annual rate equal to [ ]% of the net asset value of the Fund Account.
The fee shall be accrued for each calendar day and the sum of the daily fee
accruals shall be paid monthly on or before the fifteenth day of the following
calendar month. The daily accruals of the fee will be computed by (i)
multiplying the annual percentage rate referred to above by the fraction the
numerator of which is one and the denominator of which is the number of days in
the year, and (ii) multiplying the product obtained pursuant to clause (i) above
by the net asset value of the Fund Account as determined in accordance with the
Trust's Prospectus as of the previous day on which the Fund was open for
business. The foregoing fee shall be prorated for any month during which this
Agreement is in effect for only a portion of the month. Pursuant to the
Management and Sub-Advisory Agreement, the Fund Manager is solely responsible
for the payment of fees to the Portfolio Manager, and the Portfolio Manager
agrees to seek payment of its fees solely from the Fund Manager.
8. Other Investment Activities of Portfolio Manager. The Trust on behalf of
the Fund acknowledges that the Portfolio Manager or one or more of its
affiliates has investment responsibilities, renders investment advice to and
performs other investment advisory services for other individuals or entities
("Client Accounts"), and that the Portfolio Manager, its affiliates or any of
its or their directors, officers, agents or employees may buy, sell or trade in
any securities for its or their respective accounts ("Affiliated Accounts").
Subject to the provisions of paragraph 2 hereof, the Trust on behalf of the Fund
agrees that the Portfolio Manager or its affiliates may give advice or exercise
investment responsibility and take such other action with respect to other
Client Accounts and Affiliated Accounts which may differ from the advice given
or the timing or nature of action taken with respect to the Fund Account,
provided that the Portfolio Manager acts in good faith, and provided further,
that it is the Portfolio Manager's policy to allocate,
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110
within its reasonable discretion, investment opportunities to the Fund Account
over a period of time on a fair and equitable basis relative to the Client
Accounts and the Affiliated Accounts, taking into account the cash position and
the investment objectives and policies of the Fund and any specific investment
restrictions applicable thereto. The Trust on behalf of the Fund acknowledges
that one or more Client Accounts and Affiliated Accounts may at any time hold,
acquire, increase, decrease, dispose of or otherwise deal with positions in
investments in which the Fund Account may have an interest from time to time,
whether in transactions which involve the Fund Account or otherwise. The
Portfolio Manager shall have no obligation to acquire for the Fund Account a
position in any investment which any Client Account or Affiliated Account may
acquire, and the Fund shall have no first refusal, co-investment or other rights
in respect of any such investment, either for the Fund Account or otherwise.
9. Limitation of Liability. The Portfolio Manager shall not be liable for any
action taken, omitted or suffered to be taken by it in its reasonable judgment,
in good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement, or in accordance with (or
in the absence of) specific directions or instructions from the Fund or the Fund
Manager, provided, however, that such acts or omissions shall not have resulted
from the Portfolio Manager's willful misfeasance, bad faith or gross negligence,
a violation of the standard of care established by and applicable to the
Portfolio Manager in its actions under paragraph 2 hereof or breach of its duty
or of its obligations hereunder (provided, however, that the foregoing shall not
be construed to protect the Portfolio Manager from liability in violation of
Section 17 of the Act).
10. Confidentiality. Subject to the duty of the Portfolio Manager and the Fund
to comply with applicable law, including any demand of any regulatory or taxing
authority having jurisdiction, the parties hereto shall treat as confidential
all information pertaining to the Fund Account and the actions of the Portfolio
Manager and the Fund in respect thereof.
11. Assignment. This Agreement shall terminate automatically in the event of
its assignment, as that term is defined in Section 2(a)(4) of the Act. The
Portfolio Manager shall notify the Fund in writing sufficiently in advance of
any proposed change of control, as defined in Section 2(a)(9) of the Act, as
will enable the Fund to consider whether an assignment as defined in Section
2(a)(4) of the Act will occur, and
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111
whether to take the steps necessary to enter into a new contract with the
Portfolio Manager.
12. Representations, Warranties and Agreements of the Fund. The Trust on
behalf of the Fund represents, warrants and agrees that:
A. The Portfolio Manager has been duly appointed to provide investment services
to the Fund Account as contemplated hereby.
B. The Trust on behalf of the Fund will deliver to the Portfolio Manager a true
and complete copy of its then current registration statement as effective from
time to time and such other documents governing the investment of the Fund
Account, or such other information as is necessary for the Portfolio Manager to
carry out its obligations under this Agreement.
C. Upon certification by the Portfolio Manager that it has adopted a written
code of ethics and procedures reasonably necessary to prevent access persons, as
defined by said code of ethics, from violating the anti-fraud provisions of Rule
17j-1 under the Act, the Fund will not unreasonably withhold its approval of the
code of ethics adopted by the Portfolio Manager provided that the Portfolio
Manager certifies to the Fund that in all other material respects the Portfolio
Manager's code of ethics complies with Rule 17j-1.
13. Representations, Warranties and Agreements of the Portfolio Manager. The
Portfolio Manager represents, warrants and agrees that:
A. It is registered as an "Investment Adviser" under the Investment Advisers
Act of 1940 ("Advisers Act").
B. It will maintain, keep current and preserve on behalf of the Fund, in the
manner required or permitted by the Act and the Rules thereunder, the records
identified in Schedule B (as Schedule B may be amended from time to time). The
Portfolio Manager agrees that such records are the property of the Fund, and
will be surrendered to the Fund promptly upon request.
C. It will adopt and maintain a written code of ethics complying with the
requirements of Rule 17j-1 and submit same and any amendments thereto promptly
to the Fund, but not less often than annually. The Portfolio Manager agrees that
it will notify the Fund within 15 days of adopting material changes to its code
of ethics. While this Agreement is in effect, an officer or general partner of
the Portfolio Manager shall
B3-6
112
certify annually to the Fund that the Portfolio Manager has complied with the
requirements of Rule l7j-1 during the previous year and has procedures
reasonably necessary to prevent access persons from violating the Portfolio
Manager's code of ethics. On an annual basis, the Portfolio Manager shall
provide a written report to the Fund describing any issues arising under its
code of ethics or procedures since the last report was so submitted, including
information about material violations of the code or procedures and any action
taken in response to such violations. Upon the written request of the Fund, the
Portfolio Manager shall permit the Fund to examine the reports required to be
maintained by the Portfolio Manager under Rule l7j-l(c)(l).
D. Upon request, the Portfolio Manager will promptly supply the Trust with any
information concerning the Portfolio Manager and its stockholders, employees and
affiliates which the Trust may reasonably require in connection with the
preparation of its registration statement, proxy material, reports and other
documents relating to the Fund required to be filed under the Act, the
Securities Act of 1933, or other applicable securities laws.
E. Reference is hereby made to the Declaration of Trust dated March 4, 1993, as
amended, establishing the Trust, a copy of which has been filed with the
Secretary of the Commonwealth of Massachusetts and elsewhere as required by law,
and to any and all amendments thereto so filed or hereafter filed. The name
Liberty Variable Investment Trust refers to the Trustees under said Declaration
of Trust, as Trustees and not personally, and no Trustee, shareholder, officer,
agent or employee of the Trust shall be held to any personal liability hereunder
or in connection with the affairs of the Trust or the Fund, but only the assets
of the Fund are liable under this Agreement. Without limiting the generality of
the foregoing, neither the Portfolio Manager nor any of its officers, directors,
partners, shareholders or employees shall, under any circumstances, have
recourse or cause or willingly permit recourse to be had directly or indirectly
to any personal, statutory, or other liability of any shareholder, Trustee,
officer, agent or employee of the Trust or of any successor of the Trust or the
Fund, whether such liability now exists or is hereafter incurred, for claims
against the Trust estate, but shall look for payment solely to the assets of the
Fund or any successor thereto.
14. Amendment. This Agreement may be amended at any time, but only by written
agreement among the Portfolio Manager, the Fund Manager and the Trust, on behalf
of the Fund, which amendment, other
B3-7
113
than amendments to Schedules A and B (which may be amended by the Fund Manager
acting alone), is subject to the approval of the Trustees and the Shareholders
of the Fund as and to the extent required by the Act.
15. Effective Date; Term. This Agreement shall continue in effect until
[ ], and shall continue in effect thereafter provided such
continuance is specifically approved at least annually by (i) the Trust's Board
of Trustees or (ii) a vote of a "majority" (as defined in the Act) of the Fund's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Trustees who are not "interested
persons" (as defined in the Act) of any party to this Agreement, by vote cast in
person at a meeting called for the purpose of voting on such approval. The
aforesaid requirement that continuance of this Agreement be "specifically
approved at least annually" shall be construed in a manner consistent with the
Act and the Rules and Regulations thereunder.
16. Termination. This Agreement may be terminated by any party, without
penalty, immediately upon written notice to the other parties in the event of a
breach of any provision thereof by a party so notified, or otherwise upon not
less than thirty (30) days' written notice to the Portfolio Manager in the case
of termination by the Trust on behalf of the Fund or the Fund Manager, or ninety
(90) days' written notice to the Trust and the Fund Manager in the case of
termination by the Portfolio Manager, but any such termination shall not affect
the status, obligations or liabilities of any party hereto to the other parties.
17. Applicable Law. To the extent that state law is not preempted by the
provisions of any law of the United States heretofore or hereafter enacted, as
the same may be amended from time to time, this Agreement shall be administered,
construed and enforced according to the laws of the Commonwealth of
Massachusetts.
18. Severability. If any term or condition of this Agreement shall be invalid
or unenforceable to any extent or in any application, then the remainder of this
Agreement, and such term or condition except to such extent or in such
application, shall not be affected thereby, and each and every term and
condition of this Agreement shall be valid and enforced to the fullest extent
and in the broadest application permitted by law.
IN WITNESS WHEREOF, the parties have hereunto set their hands as of the date
first written above.
B3-8
114
LIBERTY VARIABLE INVESTMENT TRUST
on its own behalf and on behalf of the
[ ] Fund, Variable Series
By:
- ------------------------------------
[ ]
Title:
[ ]
By:
- ------------------------------------
[ ]
Title:
ACCEPTED AND AGREED TO:
[PORTFOLIO MANAGER]
By:
- ------------------------------------
Name:
- ------------------------------------
Title:
- ------------------------------------
B3-9
115
SCHEDULES:*
A. Operational Procedures [omitted]
B. Record Keeping Requirements
* The Schedules relate to day-to-day operational logistics and to technical
compliance matters.
B3-10
116
[ ] FUND, VARIABLE SERIES
RECORD KEEPING REQUIREMENTS
PORTFOLIO MANAGEMENT AGREEMENT
SCHEDULE B
RECORDS TO BE MAINTAINED BY THE PORTFOLIO MANAGER
1. (Rule 31a-1(b)(5) and (6)) A record of each brokerage order, and all other
portfolio purchases and sales, given by the Portfolio Manager on behalf of the
Fund for, or in connection with, the purchase or sale of securities, whether
executed or unexecuted. Such records shall include:
A. The name of the broker;
B. The terms and conditions of the order and of any modifications or
cancellation thereof;
C. The time of entry or cancellation;
D. The price at which executed;
E. The time of receipt of a report of execution; and
F. The name of the person who placed the order on behalf of the Fund.
2. (Rule 31a-1(b)(9)) A record for each fiscal quarter, completed within ten
(10) days after the end of the quarter, showing specifically the basis or bases
upon which the allocation of orders for the purchase and sale of portfolio
securities to named brokers or dealers was effected, and the division of
brokerage commissions or other compensation on such purchase and sale orders.
Such record:
A. Shall include the consideration given to:
(i) The sale of shares of the Fund by brokers or dealers.
(ii) The supplying of services or benefits by brokers or dealers to:
(a) The Fund;
(b) The Manager ([ ]);
(c) The Portfolio Manager; and
(d) Any person other than the foregoing.
B3-11
117
(iii) Any other consideration other than the technical qualifications of the
brokers and dealers as such.
B. Shall show the nature of the services or benefits made available.
C. Shall describe in detail the application of any general or specific formula
or other determinant used in arriving at such allocation of purchase and
sale orders and such division of brokerage commissions or other
compensation.
D. The name of the person responsible for making the determination of such
allocation and such division of brokerage commissions or other compensation.
3. (Rule 31a-1(b)(10)) A record in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the purchase
or sale of portfolio securities. Where an authorization is made by a committee
or group, a record shall be kept of the names of its members who participate in
the authorization. There shall be retained as part of this record: any
memorandum, recommendation or instruction supporting or authorizing the purchase
or sale of portfolio securities and such other information as is appropriate to
support the authorization.(1)
4. (Rule 31a-1(f)) Such accounts, books and other documents as are required to
be maintained by registered investment advisers by rule adopted Under Section
204 of the Investment Advisers Act of 1940, to the extent such records are
necessary or appropriate to record the Portfolio Manager's transactions with the
Fund.
(1) Such information might include: the current Form 10-K, annual and quarterly
reports, press releases, reports by analysts and from brokerage firms
(including their recommendation: i.e., buy, sell, hold) or any internal
reports or portfolio manager reviews.
B3-12
118
APPENDIX C
CERTAIN OTHER MUTUAL FUNDS ADVISED BY THE ADVISORS, SUB-ADVISORS AND PORTFOLIO
MANAGERS
The Advisors, Sub-Advisors and Portfolio Managers act as investment advisors or
sub-advisors to the following other mutual funds that have investment objectives
similar to the Funds', for compensation at the annual percentage rates of the
corresponding average net asset levels of those funds set forth below.
LVIT FUNDS
COLONIAL HIGH YIELD SECURITIES FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Colonial Liberty High $897.1 0.60%; Advisor
Yield million 0.55%
Securities in excess of
Fund $1.5 billion
- ------------------------------------------------------------------------------
</Table>
COLONIAL INTERNATIONAL FUND FOR GROWTH, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS)(1) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Colonial Colonial $10 million 0.75% Sub-Advisor
International
Horizons
Fund,
Variable
Series
- -------------------------------------------------------------------------------
</Table>
C-1
119
COLONIAL INTERNATIONAL HORIZONS FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Colonial Colonial $49.1 million 0.70% Sub-Advisor
International
Fund for
Growth,
Variable
Series
- ------------------------------------------------------------------------------
</Table>
COLONIAL SMALL CAP VALUE FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Colonial Liberty $404.5 0.80%; 0.75% Advisor
Small-Cap million in excess of
Value Fund $1 billion
- ------------------------------------------------------------------------------
</Table>
COLONIAL STRATEGIC INCOME FUND, VARIABLE SERIES
<Table>
<Caption>
- --------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS)(2) SUB-ADVISOR)
- --------------------------------------------------------------------------------
Colonial Liberty $1.7 billion 0.65%; 0.60% Advisor
Strategic in excess of
Income Fund $1 billion;
0.55% in
excess of $2
billion
- --------------------------------------------------------------------------------
Colonial Colonial $100.3 million 0.75% of Advisor
Intermarket average weekly
Income Trust managed assets
I (which include
assets
representing
leverage)
- --------------------------------------------------------------------------------
</Table>
C-2
120
COLONIAL U.S. GROWTH & INCOME FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Colonial Liberty $1.7 billion 0.80%; 0.70% Advisor
Growth & on assets
Income Fund over $1
billion
- ------------------------------------------------------------------------------
</Table>
LIBERTY ALL-STAR EQUITY FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
LAMCO Liberty All- $1.2 billion 0.80% per Advisor
Star Equity annum of the
Fund Fund's
average
weekly net
asset value
up to $400
million,
0.72% per
annum of such
average
weekly net
asset value
exceeding
$400 million
up to $800
million,
0.648% of
such average
weekly net
asset value
exceeding
$800 million
up to $1.2
billion, and
0.584% of
such average
weekly net
asset value
in excess of
$1.2 billion
- -------------------------------------------------------------------------------
</Table>
C-3
121
LIBERTY ALL-STAR EQUITY FUND, VARIABLE SERIES (CONT'D)
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Mastrapasqua Touchstone $171.4 million 0.60% on Advisor
Growth Value first $50
million;
0.50% on next
$50 million;
0.40% on next
$100 million;
0.35% on
assets over
$200 million
- -------------------------------------------------------------------------------
Mastrapasqua M&A Growth $15.6 million 1.00% Advisor
Value
- -------------------------------------------------------------------------------
Mastrapasqua Touchstone $5.2 million 0.60% on Advisor
Annuity first $50
million;
0.50% on next
$50 million;
0.40% on next
$100 million;
0.35% on
assets over
$200 million
- -------------------------------------------------------------------------------
Mastrapasqua EAI Select $7.07 million 0.375% Advisor
- -------------------------------------------------------------------------------
Oppenheimer Oppenheimer $1.09 billion 0.40% on the Advisor
Quest Value first $344
Fund million;
0.30% on the
next $56
million;
0.27% on the
next $400
million;
0.255% on the
next $3.2
billion;
0.24% on the
next $4
billion;
0.225% on
assets over
$8 billion
- -------------------------------------------------------------------------------
</Table>
C-4
122
LIBERTY ALL-STAR EQUITY FUND, VARIABLE SERIES (CONT'D)
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Oppenheimer OCC $98.6 million 0.80% on the Advisor
Accumulation first $400
Trust: Equity million;
Portfolio 0.75% on the
next $400
million;
0.70% on
assets over
$800 million
- -------------------------------------------------------------------------------
Westwood Gabelli $306.7 million The advisor Sub-Advisor
Westwood is paid a
Equity Fund monthly fee
based upon
the average
daily net
asset value
of the Fund
of 1.00%.
Under the
Sub-Advisory
Agreement the
advisor pays
Westwood a
fee computed
daily and
payable
monthly in an
amount equal
on an
annualized
basis to the
greater of
(i) $150,000
per year on
an aggregate
basis for the
Fund or (ii)
35% of the
net revenues
to the
advisor from
the Fund
- -------------------------------------------------------------------------------
</Table>
C-5
123
LIBERTY ALL-STAR EQUITY FUND, VARIABLE SERIES (CONT'D)
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
TCW TCW Galileo $166.4 million 1.00% Advisor
Aggressive
Growth
Equities Fund
- -------------------------------------------------------------------------------
TCW MSDW Mid-Cap $1.146 billion Advisor fee Sub-Advisor
Equity Trust is 0.75% of
the average
daily net
assets not
exceeding
$500 million;
0.725% of
next $1.5
billion;
0.70% of next
$1 billion;
and 0.675% of
average daily
net assets
exceeding $3
billion. TCW
receives
0.40% of
these fees
- -------------------------------------------------------------------------------
TCW MSDW Select $90.4 million Advisor fee Sub-Advisor
Dimensions is 0.625% of
Investment assets not
Series -- The exceeding
Mid-Cap $500 million;
Growth 0.60% of
Portfolio assets
thereafter.
TCW receives
0.40% of
these fees
- -------------------------------------------------------------------------------
</Table>
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124
LIBERTY NEWPORT JAPAN OPPORTUNITIES FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS)(3) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Newport Liberty $49.5 million 0.90% Advisor
Newport Japan
Opportunities
Fund
- -------------------------------------------------------------------------------
</Table>
LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
SSgA FM Ameritas $172 million 0.05% Sub-Advisor
Index 500
- -------------------------------------------------------------------------------
SSgA FM Citistreet $145 million 0.05% of the Sub-Advisor
Large Company first $50
Stock Fund million;
0.04% of the
next $50
million;
0.02%
thereafter;
minimum
annual fee is
the lesser of
$50,000 or
0.45% of
assets
- -------------------------------------------------------------------------------
SSgA FM John Hancock $547 million 0.05% of the Sub-Advisor
Variable first $50
Series Trust million;
Equity Index 0.04% of the
Fund next $50
million;
0.02% of the
next $200
million;
0.01%
thereafter
- -------------------------------------------------------------------------------
</Table>
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125
LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES (CONT'D)
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
SSgA FM Delaware S&P $32 million 0.05% of the Sub-Advisor
500 Index first $50
Fund million;
0.04% of the
next $50
million;
0.02%
thereafter;
$50,000
annual
minimum
- -------------------------------------------------------------------------------
SSgA FM Franklin S&P $55 million 0.05% of the Sub-Advisor
500 Index first $50
Fund million;
0.04% of the
next $50
million;
0.02%
thereafter
- -------------------------------------------------------------------------------
SSgA FM GE Funds S&P $28 million 0.05% of the Sub-Advisor
500 Index first $100
Fund million;
0.04% of the
next $200
million;
0.03%
thereafter
- -------------------------------------------------------------------------------
SSgA FM GE $88 million 0.05% of the Sub-Advisor
Institutional first $100
Funds S&P 500 million;
Index Fund 0.04% of the
next $200
million;
0.03%
thereafter
- -------------------------------------------------------------------------------
SSgA FM GE $707 million 0.05% of the Sub-Advisor
Investments first $100
Funds S&P 500 million;
Index Fund 0.04% of the
next $200
million;
0.03%
thereafter
- -------------------------------------------------------------------------------
</Table>
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126
LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES (CONT'D)
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
SSgA FM SSgA S&P 500 $2.6 billion Invested in Advisor
Index Fund the State
Street Equity
500 Index
Portfolio
Master Fund
- -------------------------------------------------------------------------------
SSgA FM State Street $3 billion 0.045% Sub-Advisor
Equity 500
Index
Portfolio*
- -------------------------------------------------------------------------------
SSgA FM Market Street $353 million 0.025% of the Sub-Advisor
Equity 500 first $200
Index million;
Portfolio 0.020% of the
next $500
million;
0.015%
thereafter
- -------------------------------------------------------------------------------
SSgA FM Sage Life $4.9 million 0.05% of the Sub-Advisor
Investment first $50
Trust S&P 500 million;
Equity Index 0.04% of the
Fund next $50
million;
0.02%
thereafter;
$50,000
annual
minimum
- -------------------------------------------------------------------------------
</Table>
*Master Feeder Structure -- includes SSgA S&P 500 Index Fund
LIBERTY SELECT VALUE FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Colonial Liberty $1.3 billion 0.70% Advisor
Select Value
Fund
- ------------------------------------------------------------------------------
</Table>
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127
NEWPORT TIGER FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Newport Liberty $676.7 1.00%; 0.75% Advisor
Newport Tiger million over $100
Fund million;
0.70% over
$1.5 billion;
0.65% over
$2.5 billion
- ------------------------------------------------------------------------------
</Table>
RYDEX FINANCIAL SERVICES FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Rydex Rydex $69.2 million 0.85% Advisor
Financials
Series Trust
- ------------------------------------------------------------------------------
</Table>
RYDEX HEALTH CARE FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
ADVISOR, OTHER FUND(S) FEE RATE RELATIONSHIP TO
SUB-ADVISOR WITH NET ASSETS OF (AS A % OTHER FUND
OR PORTFOLIO SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
MANAGER OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Rydex Rydex $65.9 million 0.85% Advisor
Healthcare
Series Trust
- ------------------------------------------------------------------------------
</Table>
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128
SRVIT FUNDS
STEIN ROE BALANCED FUND, VARIABLE SERIES
<Table>
<Caption>
- ------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS OF % OTHER FUND
ADVISOR OR SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
SUB-ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- ------------------------------------------------------------------------------
Stein Roe Stein Roe $194.7 0.55%[as a Advisor
Balanced Fund million feeder fund
of SR&F
Balanced
Portfolio]
- ------------------------------------------------------------------------------
</Table>
STEIN ROE GROWTH STOCK FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Stein Roe Liberty $946 million 0.54% Advisor
Growth Stock
Fund
- -------------------------------------------------------------------------------
Stein Roe Stein Roe $749.2 million 0.54% Advisor
Growth Stock
Fund
- -------------------------------------------------------------------------------
</Table>
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129
STEIN ROE MONEY MARKET FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
SIMILAR OTHER FUNDS AT OF AVERAGE (ADVISOR OR
ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Stein Roe Stein Roe $424.9 million 0.25% up to Advisor
Cash Reserves $500 million;
Fund 0.225% on
next $500
million;
0.200%
thereafter
[as a feeder
fund of SR&F
Cash Reserves
Portfolio]
- -------------------------------------------------------------------------------
Stein Roe Liberty Money $264.4 million 0.25% up to Advisor
Market Fund $500 million;
0.225% on
next $500
million;
0.200%
thereafter
[as a feeder
fund of SR&F
Cash Reserves
Portfolio]
- -------------------------------------------------------------------------------
</Table>
STEIN ROE SMALL COMPANY GROWTH FUND, VARIABLE SERIES
<Table>
<Caption>
- -------------------------------------------------------------------------------
ADVISOR'S
OTHER FUND(S) FEE RATE RELATIONSHIP TO
WITH NET ASSETS OF (AS A % OTHER FUND
SIMILAR OTHER FUND AT OF AVERAGE (ADVISOR OR
ADVISOR OBJECTIVES MAY 31, 2001 NET ASSETS)(4) SUB-ADVISOR)
- -------------------------------------------------------------------------------
Stein Roe Stein Roe $26.2 million 0.85% Advisor
Small Company
Growth Fund
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</Table>
(1)The Colonial International Horizons Fund, Variable Series' advisor has
voluntarily agreed to reimburse all expenses, including management fees, but
excluding interest, taxes, 12b-1, brokerage and extraordinary expenses,
incurred by the Fund in excess of 1.15% of average daily net asset value per
annum.
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(2) Effective November 1, 1998, voluntary reduction from 0.70% to 0.60% on
assets over $1 billion.
(3) The Liberty Newport Japan Opportunities Fund's investment advisor and
administrator have voluntarily agreed to waive advisory and administration
fees and reimburse the Fund for certain expenses so that the total annual
fund operating expenses (exclusive of distribution and service fees,
brokerage commissions, interest, taxes and extraordinary expenses, if any)
will not exceed 1.75%. This arrangement may be modified or terminated by the
advisor or administrator at any time.
(4) The Stein Roe Small Company Growth Fund's advisor has voluntarily agreed to
reimburse the Fund for certain expenses so that the total annual fund
operating expenses (exclusive of distribution and service fees, brokerage
commissions, interest, taxes and extraordinary expenses, if any) will not
exceed 1.50%. This arrangement may be modified or terminated by the advisor
at any time.
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APPENDIX D
BROKERAGE PRACTICES
The following is a summary of the brokerage practices of the Advisors,
Sub-Advisors and Portfolio Managers:
LIBERTY VARIABLE INVESTMENT TRUST
PORTFOLIO TRANSACTIONS
The Trust has no obligation to do business with any broker-dealer or group of
broker-dealers in executing transactions in securities with respect to the
Funds, and the Funds have no intention to deal exclusively with any particular
broker-dealer or group of broker-dealers.
Each of Colonial, Stein Roe, Newport, Crabbe Huson, Rydex, State Street and each
of LAMCO's Portfolio Managers, (each an "Advisor") places the transactions of
the Funds with broker-dealers selected by it and, if applicable, negotiates
commissions. Broker-dealers may receive brokerage commissions on portfolio
transactions, including the purchase and writing of options, the effecting of
closing purchase and sale transactions, and the purchase and sale of underlying
securities upon the exercise of options and the purchase or sale of other
instruments. The Funds from time to time may also execute portfolio transactions
with such broker-dealers acting as principals.
Except as described below in connection with commissions paid to a clearing
agent on sales of securities, it is each Fund's policy and the policy of its
Advisor always to seek best execution, which is to place the Fund's transactions
where the Fund can obtain the most favorable combination of price and execution
services in particular transactions or provided on a continuing basis by a
broker-dealer, and to deal directly with a principal market maker in connection
with over-the-counter transactions, except when the Advisor believes that best
execution is obtainable elsewhere. In evaluating the execution services of,
including the overall reasonableness of brokerage commissions paid to, a broker-
dealer, consideration is given to, among other things, the firm's general
execution and operational capabilities, and to its reliability, integrity and
financial condition.
Subject to such policy of always seeking best execution, and subject to the
additional matters described below regarding each of Colonial
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International Fund for Growth Variable Series, Colonial International Horizons
Fund, Variable Series, Colonial Global Equity Fund, Variable Series, Rydex
Health Care Fund, Variable Series and Liberty All-Star Equity Fund, Variable
Series, securities transactions of the Funds may be executed by broker-dealers
who also provide research services (as defined below) to an Advisor, the Funds
or other accounts as to which such Advisor exercises investment discretion. Such
advisor may use all, some or none of such research services in providing
investment advisory services to each of its clients, including the Fund(s) it
advises. To the extent that such services are used by the Advisors, they tend to
reduce their expenses. It is not possible to assign an exact dollar value for
such services.
Subject to such policies as the Board of Trustees may determine, each of the
Advisors may cause a Fund to pay a broker-dealer that provides brokerage and
research services to it an amount of commission for effecting a securities
transaction, including the sale of an option or a closing purchase transaction,
for a Fund in excess of the amount of commission that another broker-dealer
would have charged for effecting that transaction. As provided in Section 28(e)
of the Securities Exchange Act of 1934, "brokerage and research services"
include advice as to the value of securities, the advisability of investing in,
purchasing or selling securities and the availability of securities or
purchasers or sellers of securities; furnishing analyses and reports concerning
issuers, industries, securities, economic factors and trends and portfolio
strategy and performance of accounts; and effecting securities transactions and
performing functions incidental thereto (such as clearance and settlement). An
Advisor placing a brokerage transaction must determine in good faith that such
greater commission is reasonable in relation to the value of the brokerage and
research services provided to it by the executing broker-dealer viewed in terms
of that particular transaction or its overall responsibilities to the applicable
Fund and all its other clients.
Certain of the other accounts of any of the Advisors may have investment
objectives and programs that are similar to those of the Funds. Accordingly,
occasions may arise when each of the Advisors engages in simultaneous purchase
and sale transactions of securities that are consistent with the investment
objectives and programs of a Fund and such other accounts. On those occasions,
the Advisor will allocate purchase and sale transactions in an equitable manner
according to written procedures as approved by the Board of Trustees. Such
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procedures may, in particular instances, be either advantageous or
disadvantageous to a Fund.
Consistent with applicable rules of the National Association of Securities
Dealers, Inc., and subject to seeking best execution and such other policies as
the Board of Trustees may determine, each of the Advisors may consider sales of
VA contracts and VLI policies as a factor in the selection of broker-dealers to
execute securities transactions for the Funds.
ADDITIONAL MATTERS PERTAINING TO RYDEX HEALTH CARE FUND, VARIABLE SERIES. The
Rydex Health Care Fund, Variable Series may invest in companies that are
involved in the health care industry including companies engaged in the design,
manufacture, or sale of products or services used for or in connection with
health care or medicine. Companies in the health care sector may include
pharmaceutical companies; firms that design, manufacture, sell or supply
medical, dental, and optical products, hardware or services; companies involved
in biotechnology, medical diagnostic, and biochemical research and development,
as well as companies involved in the operation of health care facilities.
ADDITIONAL MATTERS PERTAINING TO COLONIAL INTERNATIONAL FUND FOR GROWTH,
VARIABLE SERIES, COLONIAL INTERNATIONAL HORIZONS FUND, VARIABLE SERIES, COLONIAL
GLOBAL EQUITY FUND, VARIABLE SERIES AND STEIN ROE GLOBAL UTILITIES FUND,
VARIABLE SERIES. The portfolio managers for the Colonial International Fund for
Growth, Variable Series and the Colonial International Horizons Fund, Variable
Series are Charles R. Roberts, Michael Ellis and Deborah Snee and for the
Colonial Global Equity Fund, Variable Series are Charles R. Roberts and Erik P.
Gustafson and Stein Roe Global Utilities Fund, Variable Series are Charles R.
Roberts and Scott Schermerhorn, all of whom are jointly employed by Newport,
Colonial and Stein Roe (each of which is an indirect wholly owned subsidiary of
Liberty Financial). The Funds and the other accounts advised by these managers
sometimes invest in the same securities and sometimes enter into similar
transactions utilizing futures contracts and foreign currencies. In certain
cases, purchases and sales on behalf of the Funds and such other accounts will
be bunched and executed on an aggregate basis. In such cases, each participating
account (including the Colonial International Fund for Growth, Variable Series,
Colonial International Horizons Fund, Variable Series, Colonial Global Equity
Fund, Variable Series and Stein Roe Global Utilities Fund, Variable
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Series) will receive the average price at which the trade is executed. Where
less than the desired aggregate amount is able to be purchased or sold, the
actual amount purchased or sold will be allocated among the participating
accounts (including the Colonial International Fund for Growth, Variable Series,
Colonial International Horizons Fund, Variable Series, Colonial Global Equity
Fund, Variable Series and Stein Roe Global Utilities Fund, Variable Series) in
proportion to the amounts desired to be purchased or sold by each.
Although in some cases these practices could have a detrimental effect on the
price or volume of the securities, futures or currencies as far as the Colonial
International Fund for Growth, Variable Series, Colonial International Horizons
Fund, Variable Series, Colonial Global Equity Fund, Variable Series and Stein
Roe Global Utilities Fund, Variable Series are concerned, Colonial and Stein Roe
believe that in most cases these practices should produce better executions. It
is the opinion of Colonial and Stein Roe that the advantages of these practices
outweigh the disadvantages, if any, which might result from them.
Portfolio transactions on behalf of the Colonial International Fund for Growth,
Variable Series, Colonial International Horizons Fund, Variable Series, Colonial
Global Equity Fund, Variable Series and Stein Roe Global Utilities Fund,
Variable Series may be executed by broker-dealers who provide research services
to Colonial or Stein Roe which are used in the investment management of such
Funds or other accounts over which Colonial or Stein Roe exercise investment
discretion. Such transactions will be effected in accordance with the policies
described above. No portfolio transactions on behalf of the Funds will be
directed to a broker-dealer in consideration of the broker-dealer's provision of
research services to Colonial and Stein Roe, unless a determination is made that
such research assists Colonial in its investment management of the Colonial
International Fund for Growth, Variable Series, Colonial International Horizons
Fund, Variable Series, Colonial Global Equity Fund, Variable Series, Stein Roe
in its management of Stein Roe Global Utilities Fund, Variable Series or other
accounts over which Colonial or Stein Roe exercises investment discretion.
ADDITIONAL MATTERS PERTAINING TO LIBERTY ALL-STAR EQUITY FUND, VARIABLE
SERIES. The Portfolio Management Agreements with LAMCO's Portfolio Managers
provide that LAMCO has the right to request that transactions giving rise to
brokerage commissions, in amounts to be agreed upon from time to time between
LAMCO and the
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Portfolio Manager, be executed by brokers and dealers (to be agreed upon from
time to time between LAMCO and the Portfolio Manager) which provide research
products and services to LAMCO or to Liberty All-Star Equity Fund, Variable
Series or other accounts managed by LAMCO (collectively with Liberty All-Star
Equity Fund, Variable Series, "LAMCO Clients") or as to which an ongoing
relationship will be a value to the Fund in managing its assets. The commissions
paid on such transactions may exceed the amount of commissions another broker
would have charged for effecting that transaction. Research products and
services made available to LAMCO through brokers and dealers executing
transactions for LAMCO Clients involving brokerage commissions include
performance and other qualitative and quantitative data relating to investment
managers in general and the Portfolio Managers in particular; data relating to
the historic performance of categories of securities associated with particular
investment styles; mutual fund portfolio and performance data; data relating to
portfolio manager changes by pension plan fiduciaries; quotation equipment; and
related computer hardware and software, all of which research products and
services are used by LAMCO in connection with its selection and monitoring of
portfolio managers (including the Portfolio Managers) for LAMCO Clients, the
assembly of a mix of investment styles appropriate to LAMCO's Clients'
investment objectives, and the determination of overall portfolio strategies.
LAMCO from time to time reaches understandings with each of the Portfolio
Managers as to the amount of the Liberty All-Star Equity Fund, Variable Series
portfolio transactions initiated by such Portfolio Manager that are to be
directed to brokers and dealers which provide research products and services to
LAMCO. These amounts may differ among the Portfolio Managers based on the nature
of the markets for the types of securities managed by them and other factors.
These research products and services are used by LAMCO in connection with its
management of LAMCO Clients' portfolios, regardless of the source of the
brokerage commissions. In instances where LAMCO receives from broker-dealers
products or services which are used both for research purposes and for
administrative or other non-research purposes, LAMCO makes a good faith effort
to determine the relative proportions of such products or services which may be
considered as investment research, based primarily on anticipated usage, and
pays for the costs attributable to the non-research usage in cash.
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ADDITIONAL MATTERS PERTAINING TO CRABBE HUSON REAL ESTATE INVESTMENT FUND,
VARIABLE SERIES. Consistent with the Conduct Rules of the National Association
of Securities Dealers, Inc., and subject to seeking "best execution" (as defined
below) and such other policies as the Trustees may determine, Crabbe Huson may
consider sales of shares of the Fund as a factor in the selection of
broker-dealers to execute securities transactions for the Fund.
Crabbe Huson places the transactions of the Fund with broker-dealers selected by
Crabbe Huson and, if applicable, negotiates commissions. Broker-dealers may
receive brokerage commissions on portfolio transactions, including the purchase
and writing of options, the effecting of closing purchase and sale transactions,
and the purchase and sale of underlying securities upon the exercise of options
and the purchase or sale of other instruments. The Fund from time to time also
executes portfolio transactions with such broker-dealers acting as principals.
The Fund does not intend to deal exclusively with any particular broker-dealer
or group of broker-dealers.
It is Crabbe Huson's policy generally to seek best execution, which is to place
the Fund's transactions where the Fund can obtain the most favorable combination
of price and execution services in particular transactions or provided on a
continuing basis by a broker-dealer, and to deal directly with a principal
market maker in connection with over-the-counter transactions, except when it is
believed that best execution is obtainable elsewhere. In evaluating the
execution services of, including the overall reasonableness of brokerage
commissions paid to, a broker-dealer, consideration is given to, among other
things, the firm's general execution and operational capabilities, and to its
reliability, integrity and financial condition.
Securities transactions of the Fund may be executed by broker-dealers who also
provide research services (as defined below) to Crabbe Huson and the Fund.
Crabbe Huson may use all, some or none of such research services in providing
investment advisory services to each of its investment company and other
clients, including the Fund. To the extent that such services are used by Crabbe
Huson, they tend to reduce Crabbe Huson's expenses. In Crabbe Huson's opinion,
it is impossible to assign an exact dollar value for such services.
The Trustees have authorized Crabbe Huson to cause the Fund to pay a
broker-dealer which provides brokerage and research services to Crabbe
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Huson an amount of commission for effecting a securities transaction, including
the sale of an option or a closing purchase transaction, for the Fund in excess
of the amount of commission which another broker-dealer would have charged for
effecting that transaction. As provided in Section 28(e) of the Securities
Exchange Act of 1934, "brokerage and research services" include advice as to the
value of securities, the advisability of investing in, purchasing or selling
securities and the availability of securities or purchasers or sellers of
securities; furnishing analyses and reports concerning issues, industries,
securities, economic factors and trends and portfolio strategy and performance
of accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). Crabbe Huson must
determine in good faith that such greater commission is reasonable in relation
to the value of the brokerage and research services provided by the executing
broker-dealer viewed in terms of that particular transaction or Crabbe Huson's
overall responsibilities to the Fund and all its other clients.
The Trustees have authorized Crabbe Huson to utilize the services of a clearing
agent with respect to all call options written by funds that write options and
to pay such clearing agent commissions of a fixed amount per share (currently
1.25 cents) on the sale of the underlying security upon the exercise of an
option written by a fund.
STEIN ROE VARIABLE INVESTMENT TRUST
PORTFOLIO TRANSACTIONS [APPLIES TO ALL FUNDS EXCEPT THE PORTION OF THE ASSETS OF
STEIN ROE BALANCED FUND, VARIABLE SERIES MANAGED BY NORDEA SECURITIES, INC.]
Stein Roe places the orders for the purchase and sale of portfolio securities
and options and futures contracts for its clients, including private clients and
mutual fund clients ("Clients"). Stein Roe and its affiliate Colonial maintain a
single, unified trading operation for trading equity securities. Stein Roe's
overriding objective in selecting brokers and dealers to effect portfolio
transactions is to seek the best combination of net price and execution. The
best net price, giving effect to brokerage commissions, if any, is an important
factor in this decision; however, a number of other judgmental factors may also
enter into the decision. These factors include Stein Roe's knowledge of
negotiated commission rates currently available and other current transaction
costs; the nature of the security being purchased or sold; the size of the
transaction; the
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desired timing of the transaction; the activity existing and expected in the
market for the particular security; confidentiality; the execution, clearance
and settlement capabilities of the broker or dealer selected and others
considered; Stein Roe's knowledge of the financial condition of the broker or
dealer selected and such other brokers and dealers; and Stein Roe's knowledge of
actual or apparent operation problems of any broker or dealer.
Recognizing the value of these factors, Stein Roe may cause a Client to pay a
brokerage commission in excess of that which another broker may have charged for
effecting the same transaction. Evaluations of the reasonableness of brokerage
commissions, based on the factors described in the preceding paragraph, are made
by Stein Roe's trading personnel while effecting portfolio transactions. The
general level of brokerage commissions paid is reviewed by Stein Roe, and
reports are made annually to the Board of Trustees.
Stein Roe maintains and periodically updates a list of approved brokers and
dealers which, in Stein Roe's judgment, are generally capable of providing best
price and execution and are financially stable.
It is Stein Roe's practice, when feasible, to aggregate for execution as a
single transaction orders for the purchase or sale of a particular security for
the accounts of several Clients (and, when feasible, Colonial clients), in order
to seek a lower commission or more advantageous net price. The benefit, if any,
obtained as a result of such aggregation generally is allocated pro rata among
the accounts of Clients which participated in the aggregated transaction.
Stein Roe places certain trades for the Funds through its affiliate AlphaTrade
Inc. ("ATI"). ATI is a wholly owned subsidiary of Colonial. ATI is a fully
disclosed introducing broker that limits its activities to electronic execution
of transactions in listed equity securities. The Funds pay ATI a commission for
these transactions. The Funds have adopted procedures consistent with Investment
Company Act Rule 17e-1 governing such transactions. Certain of Stein Roe's
officers also serve as officers, directors and/or employees of ATI.
CONSISTENT WITH THE CONDUCT RULES OF THE NATIONAL ASSOCIATION OF SECURITIES
DEALERS, INC. AND SUBJECT TO SEEKING BEST EXECUTION AND SUCH OTHER POLICIES AS
THE TRUSTEES OF THE FUNDS MAY DETERMINE, STEIN ROE MAY CONSIDER SALES OF SHARES
OF EACH OF THE FUNDS AS A FACTOR IN THE
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SELECTION OF BROKER-DEALERS TO EXECUTE SUCH MUTUAL FUND SECURITIES TRANSACTIONS.
INVESTMENT RESEARCH PRODUCTS AND SERVICES FURNISHED
BY BROKERS AND DEALERS
Stein Roe engages in the long-standing practice in the money management industry
of acquiring research and brokerage products and services ("research products")
from broker-dealer firms in return directing trades for Client accounts to those
firms. In effect, Stein Roe is using the commission dollars generated from these
Client accounts to pay for these research products. The money management
industry uses the term "soft dollars" to refer to this industry practice. Stein
Roe may engage in soft dollar transactions on trades for those Client accounts
for which Stein Roe has the discretion to select the broker-dealers.
The ability to direct brokerage for a Client account belongs to the Client and
not to Stein Roe. When a Client grants Stein Roe the discretion to select
broker-dealers for Client trades, Stein Roe has a duty to seek the best
combination of net price and execution. Stein Roe faces a potential conflict of
interest with this duty when it uses Client trades to obtain soft dollar
products. This conflict exists because Stein Roe is able to use the soft dollar
products in managing its Client accounts without paying cash ("hard dollars")
for the product. This reduces Stein Roe's expenses.
Moreover, under a provision of the federal securities laws applicable to soft
dollars, Stein Roe is not required to use the soft dollar product in managing
those accounts that generate the trade. This practice is explicitly sanctioned
by a provision of the Securities Exchange Act of 1934, which creates a "safe
harbor" for soft dollar transactions conducted in a specified manner. Although
it is inherently difficult, if not impossible, to document, Stein Roe believes
that over time most, if not all, Clients benefit from soft dollar products such
that cross subsidizations even out.
Stein Roe attempts to reduce or eliminate this conflict by directing Client
trades for soft dollar products only if Stein Roe concludes that the
broker-dealer supplying the product is capable of providing a combination of the
best net price and execution on the trade. Stein Roe may cause a Client account
to pay a brokerage commission in a soft dollar trade in excess of that which
another broker-dealer might have charged for the same transaction.
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Stein Roe acquires two types of soft dollar research products: (i) proprietary
research created by the broker-dealer firm executing the trade and (ii) other
products created by third parties that are supplied to Stein Roe through the
broker-dealer firm executing the trade.
Proprietary research consists primarily of traditional research reports,
recommendations and similar materials produced by the in house research staffs
of broker-dealer firms. This research includes evaluations and recommendations
of specific companies or industry groups, as well as analyses of general
economic and market conditions and trends, market data, contacts and other
related information and assistance. Stein Roe's research analysts periodically
rate the quality of proprietary research produced by various broker-dealer
firms. Based on these evaluations, Stein Roe develops target levels of
commission dollars on a firm-by-firm basis. Stein Roe attempts to direct trades
to each firm to meet these targets.
Stein Roe also uses soft dollars to acquire products created by third parties
that are supplied to Stein Roe through broker-dealers executing the trade (or
other broker-dealers who "step in" to a transaction and receive a portion of the
brokerage commission for the trade). These products include: (1) database
services; (2) quotation, trading and news systems; (3) economic data and
forecasting tools; (4) quantitative and technical analysis tools; (5)
fundamental industry analysis; (6) fixed income security analysis; and (7) other
specialized products, such as specialized economic consulting analyses.
Many third-party products include computer software or on-line data feeds.
Certain products also include computer hardware necessary to use the product.
Certain of these third party services may be available directly from the vendor
on a hard dollar basis. Others are available only through broker-dealer firms
for soft dollars. Stein Roe evaluates each product to determine a cash ("hard
dollars") value of the product to Stein Roe. Stein Roe then on a
product-by-product basis targets commission dollars in an amount equal to a
specified multiple of the hard dollar value to the broker-dealer that supplies
the product to Stein Roe. Stein Roe attempts to direct trades to each firm to
meet these targets.
However, these targets are not binding commitments, and Stein Roe does not agree
to direct a minimum amount of commissions to any broker-dealer for soft dollar
products. In setting these targets, Stein Roe
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makes a determination that the value of the product is reasonably commensurate
with the cost of acquiring it. Stein Roe will receive the product whether or not
commissions directed to the applicable broker-dealer are less than, equal to or
in excess of the target. In the case of third party products, the third party is
paid by the broker-dealer and not by Stein Roe. Stein Roe may enter into a
contract with the third party vendor to use the product.
In certain cases, Stein Roe uses soft dollars to obtain products that have both
research and non-research purposes. Examples of non-research uses are
administrative and marketing functions. These are referred to as "mixed use"
products. As of the date of this Proxy Statement, Stein Roe acquires two mixed
use products. These are (i) a fixed income security data service and (ii) a
mutual fund performance ranking service. In each case, Stein Roe makes a good
faith evaluation of the research and non-research uses of these services. Stein
Roe pays the provider in cash ("hard dollars") for the non-research portion of
its use of these products.
In certain cases, Stein Roe will direct a trade to one broker-dealer with the
instruction that it execute the trade and pay over a portion of the commission
from the trade to another broker-dealer who provides Stein Roe with a soft
dollar research product. The broker-dealer executing the trade "steps out" of a
portion of the commission in favor of the other broker-dealer providing the soft
dollar product. Stein Roe may engage in step out transactions in order to direct
soft dollar commissions to a broker-dealer which provides research but may not
be able to provide best execution. Brokers who receive step out commissions
typically are brokers providing a third party soft dollar product that is not
available on a hard dollars basis. Stein Roe has not engaged in step out
transactions as a manner of compensating broker-dealers that sell shares of
investment companies managed by Stein Roe.
As stated above, Stein Roe's overriding objective in effecting portfolio
transactions for the Funds is to seek to obtain the best combination of price
and execution. However, consistent with the provisions of the Conduct Rules of
the National Association of Securities Dealers, Inc., Stein Roe may, in
selecting broker-dealers to effect portfolio transactions for the Funds, and
where more than one broker-dealer is believed capable of providing the best
combination of net price and execution with respect to a particular transaction,
select a broker-dealer in recognition of its sales of VA contracts or VLI
policies offered by Participating Insurance Companies. Except as described in
the next
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following sentence, neither the Trust nor any Fund nor Stein Roe has entered
into any agreement with, or made any commitment to, any unaffiliated
broker-dealer which would bind Stein Roe, the Trust or any Fund to compensate
any such broker-dealer, directly or indirectly, for sales of VA contracts or VLI
policies. Stein Roe has entered into arrangements with sponsors of programs for
the sale of VA contracts issued by Participating Insurance Companies which are
not affiliates of Stein Roe pursuant to which Stein Roe pays the sponsor from
Stein Roe's fee for managing the Funds an amount in respect of each Fund's
assets allocable to that Fund's shares held in separate accounts of such
unaffiliated Participating Insurance Companies in respect of VA contracts issued
by such entities and sold through such arrangements. Stein Roe does not cause
the Trust or any Fund to pay brokerage commissions higher than those obtainable
from other broker-dealers in recognition of such sales of VA contracts or VLI
policies.
In light of the fact that Stein Roe may also provide advisory services to the
Participating Insurance Companies, and to other advisory accounts that may or
may not be registered investment companies, securities of the same issuer may be
included, from time to time, in the portfolios of the Funds and these other
entities where it is consistent with their respective investment objectives. If
these entities desire to buy or sell the same portfolio security at about the
same time, combined purchases and sales may be made, and in such event the
security purchased or sold normally will be allocated at the average price and
as nearly as practicable on a pro-rata basis in proportion to the amounts
desired to be purchased or sold by each entity. While it is possible that in
certain instances this procedure could adversely affect the price or number of
shares involved in the Funds' transactions, it is believed that the procedure
generally contributes to better overall execution of the Funds' portfolio
transactions.
Because Stein Roe's personnel may also provide investment advisory services to
the Participating Insurance Companies and other advisory clients, it may be
difficult to quantify the relative benefits received by the Trust and these
other entities from research provided by broker-dealers.
The Trust has arranged for the Bank, as its custodian, to act as a soliciting
dealer to accept any fees available to the Bank as a soliciting dealer in
connection with any tender offer for a Fund's portfolio securities. The Bank
will credit any such fees received against its custodial fees. However, the
Board has been advised by counsel that
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recapture by a mutual fund currently is not permitted under the Rules of Conduct
of the National Association of Securities Dealers, Inc.
The Trust's purchases and sales of securities not traded on securities exchanges
generally are placed by Stein Roe with market makers for these securities on a
net basis, without any brokerage commissions being paid by the Trust. Net
trading does involve, however, transaction costs. Included in prices paid to
underwriters of portfolio securities is the spread between the price paid by the
underwriter to the issuer and the price paid by the purchasers. Each Fund's
purchases and sales of portfolio securities in the over-the-counter market
usually are transacted with a broker-dealer on a net basis without any brokerage
commission being paid by such Fund, but do reflect the spread between the bid
and asked prices. Stein Roe may also transact purchases of some portfolio
securities directly with the issuers.
With respect to a Fund's purchases and sales of portfolio securities transacted
with a broker or dealer on a net basis, Stein Roe may also consider the part, if
any, played by the broker or dealer in bringing the security involved to Stein
Roe's attention, including investment research related to the security and
provided to the Fund.
ADDITIONAL MATTERS PERTAINING TO THE PORTION OF THE ASSETS OF STEIN ROE BALANCED
FUND, VARIABLE SERIES MANAGED BY NORDEA SECURITIES, INC.] Transactions on stock
exchanges and other agency transactions for the accounts of the Funds involve
the payment by the Funds of negotiated brokerage commissions. A particular
broker may charge different commissions according to such factors as the
difficulty and size of the transaction. There is generally no stated commission
in the case of securities traded in the over-the-counter markets, but the price
paid by the Funds usually includes an undisclosed dealer commission, markup or
markdown. In underwritten offerings, the price paid by the Funds includes a
disclosed, fixed commission or discount retained by the underwriter or dealer.
In addition to selecting portfolio investments for the Funds, Nordea selects
brokers or dealers to execute securities purchases and sales for the Funds'
accounts. Nordea selects only brokers or dealers which it believes are
financially responsible, will provide efficient and effective services in
executing, clearing and settling an order and will charge commission rates
which, when combined with the quality of the
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foregoing services, will produce best price and execution for the transaction.
Nordea's receipt of research services from brokers may sometimes be a factor in
its selection of a broker that it believes will provide best price and execution
for a transaction. These research services include not only a wide variety of
reports on such matters as economic and political developments, industries,
companies, securities, portfolio strategy, account performance, daily prices of
securities, stock and bond market conditions and projections, asset allocation
and portfolio structure, but also meetings with management representatives of
issuers and with other analysts and specialists. Although it is in many cases
not possible to assign an exact dollar value to these services, they may, to the
extent used, tend to reduce Nordea's expenses. Such services may be used by
Nordea in managing other client accounts and in some cases may not be used with
respect to the Funds. Receipt of services or products other than research from
brokers is not a factor in the selection of brokers. Consistent with the Conduct
Rules of the National Association of Securities Dealers, Inc., and subject to
seeking best price and execution, purchases of shares of a Fund by customers of
broker-dealers may be considered as a factor in the selection of broker-dealers
to execute the Funds' securities transactions.
Nordea may cause a Fund to pay a broker-dealer that provides brokerage and
research services to Nordea an amount of commission for effecting a securities
transaction for that Fund in excess of the amount another broker-dealer would
have charged for effecting that transaction. Nordea must determine in good faith
that such greater commission is reasonable in relation to the value of the
brokerage and research services provided by the executing broker-dealer viewed
in terms of that particular transaction or Nordea's overall responsibilities to
the Fund and its other clients. Nordea's authority to such a Fund to pay greater
commissions is also subject to such policies as the Trustees of the Trust may
adopt from time to time.
Transactions in unlisted securities are carried out through broker-dealers who
make the primary market for such securities unless, in the judgment of Nordea, a
more favorable price can be obtained by carrying out such transactions through
other brokers or dealers.
D-14
145
APPENDIX E
COMPENSATION PAID BY A FUND TO THE ADVISOR AND AFFILIATES
FOR EACH FUND'S LAST FISCAL YEAR
<Table>
<Caption>
- ---------------------------------------------------------------------------------------------------------------------------------
NET
TRANSFER NET NET
AGENCY AND FEES FOR DISTRIBUTION
SHAREHOLDER PRICING AND AND SHAREHOLDER
NET NET SERVICING BOOKKEEPING SERVICING
ADVISORY ADMINISTRATIVE FEES SERVICES (12B-1)
FEE PAID FEES PAID TO PAID TO PAID TO FEES PAID TO
TO ADVISORS' ADVISORS' ADVISORS' ADVISORS'
NAME OF FUND ADVISOR(1) AFFILIATES AFFILIATES AFFILIATES AFFILIATES(2)
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial Global Equity Fund, Variable Series $ 40,690 $ 0 $7,500 $27,000 $23,603
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial High Yield Securities Fund, Variable
Series 100,988 0 7,500 27,000 0
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial International Fund for Growth, Variable
Series 642,065 0 7,500 34,377 1
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial International Horizons Fund, Variable
Series 58,977 0 7,500 27,000 27,493
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial Small Cap Value Fund, Variable Series 0 0 7,500 27,000 0
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial Strategic Income Fund, Variable Series 1,028,637 0 7,500 64,709 1,777
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial U.S. Growth & Income Fund, Variable Series 1,645,625 0 7,500 86,096 982
- ---------------------------------------------------------------------------------------------------------------------------------
Crabbe Huson Real Estate Investment Fund,
Variable Series 0 0 7,500 27,000 7,607
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty All-Star Equity Fund, Variable Series 525,572 0 7,500 33,902 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Newport Japan Opportunities Fund,
Variable Series 0 0 4,508 16,229 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty S&P 500 Index Fund, Variable Series 1,168 0 4,508 16,229 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Select Value Fund, Variable Series 0 0 4,508 16,229 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Value Fund, Variable Series 1,217,773 0 7,500 74,890 250
- ---------------------------------------------------------------------------------------------------------------------------------
Newport Tiger Fund, Variable Series 446,975 0 7,500 27,000 658
- ---------------------------------------------------------------------------------------------------------------------------------
<Caption>
- ---------------------------------------------------- ----------------------------------
NET
BROKERAGE PERCENTAGE OF
COMMISSIONS ON FUND'S TOTAL
FUND'S PORTFOLIO BROKERAGE
TRANSACTIONS COMMISSIONS
PAID TO PAID TO
ADVISORS' ADVISORS'
BROKERAGE BROKERAGE
NAME OF FUND AFFILIATES AFFILIATES
- ---------------------------------------------------- ----------------------------------
Colonial Global Equity Fund, Variable Series $ 0 0%
- -------------------------------------------------------------------------------------------------------
Colonial High Yield Securities Fund, Variable
Series 0 0
- -----------------------------------------------------------------------------------------------------------------------
Colonial International Fund for Growth, Variable
Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial International Horizons Fund, Variable
Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial Small Cap Value Fund, Variable Series 2,662 13
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial Strategic Income Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Colonial U.S. Growth & Income Fund, Variable Series 35,234 8
- ---------------------------------------------------------------------------------------------------------------------------------
Crabbe Huson Real Estate Investment Fund,
Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty All-Star Equity Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Newport Japan Opportunities Fund,
Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty S&P 500 Index Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Select Value Fund, Variable Series 880 17
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Value Fund, Variable Series 111,189 24
- ---------------------------------------------------------------------------------------------------------------------------------
Newport Tiger Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
</Table>
E-1
146
<Table>
<Caption>
- ---------------------------------------------------------------------------------------------------------------------------------
NET
TRANSFER NET NET
AGENCY AND FEES FOR DISTRIBUTION
SHAREHOLDER PRICING AND AND SHAREHOLDER
NET NET SERVICING BOOKKEEPING SERVICING
ADVISORY ADMINISTRATIVE FEES SERVICES (12B-1)
FEE PAID FEES PAID TO PAID TO PAID TO FEES PAID TO
TO ADVISORS' ADVISORS' ADVISORS' ADVISORS'
NAME OF FUND ADVISOR(1) AFFILIATES AFFILIATES AFFILIATES AFFILIATES(2)
- ---------------------------------------------------------------------------------------------------------------------------------
Rydex Financial Services Fund, Variable Series $ 0 $ 0 $4,375 $15,750 $ 0
- ---------------------------------------------------------------------------------------------------------------------------------
Rydex Health Care Fund, Variable Series 0 0 4,375 16,229 0
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Global Utilities Fund, Variable Series 720,174 0 7,500 50,009 2
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Federal Securities Fund, Variable Series 421,467 158,050 7,500 26,318 3,720
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Balanced Fund, Variable Series 1,856,618 618,873 7,500 34,130 7,248
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Growth Stock Fund, Variable Series 2,264,063 679,219 7,500 35,135 12,970
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Money Market Fund, Variable Series 626,629 268,555 7,500 28,291 0
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Small Company Growth Fund,
Variable Series 697,628 209,289 7,500 27,303 2
- ---------------------------------------------------------------------------------------------------------------------------------
<Caption>
- ---------------------------------------------------- ----------------------------------
NET
BROKERAGE PERCENTAGE OF
COMMISSIONS ON FUND'S TOTAL
FUND'S PORTFOLIO BROKERAGE
TRANSACTIONS COMMISSIONS
PAID TO PAID TO
ADVISORS' ADVISORS'
BROKERAGE BROKERAGE
NAME OF FUND AFFILIATES AFFILIATES
- ---------------------------------------------------- ----------------------------------
Rydex Financial Services Fund, Variable Series $ 0 0%
- ---------------------------------------------------------------------------------------------------------------------------------
Rydex Health Care Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Global Utilities Fund, Variable Series 2,483 1
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Liberty Federal Securities Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Balanced Fund, Variable Series 7,667 3
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Growth Stock Fund, Variable Series 11,364 2
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Money Market Fund, Variable Series 0 0
- ---------------------------------------------------------------------------------------------------------------------------------
Stein Roe Small Company Growth Fund,
Variable Series 630 0
- ---------------------------------------------------------------------------------------------------------------------------------
</Table>
(1) For the fiscal year ended December 31, 2000, LASC reimbursed $15,896 of its
advisory fee for Liberty All-Star Equity Fund, Variable Series; $53,931 of
its advisory fee and assumed additional expenses of $1,498 for Colonial
Small Cap Value Fund, Variable Series; $11,685 of its advisory fee for
Colonial High Yield Securities Fund, Variable Series; $30,938 of its
advisory fee and assumed additional expenses of $20,295 for Crabbe Huson
Real Estate Investment Fund, Variable Series; $48,980 of its advisory fee
for Colonial Global Equity Fund, Variable Series; $42,341 of its advisory
fee for Colonial International Horizons Fund, Variable Series; $17,830 of
its advisory fee for Liberty S&P 500 Index Fund, Variable Series; $10,940 of
its advisory fee and assumed additional expenses of $17,476 for Rydex Health
Care Fund, Variable Series; $8,024 of its advisory fee and assumed
additional expenses of $19,923 for Rydex Financial Services Fund, Variable
Series; $11,300 of its advisory fee and assumed additional expenses of
$10,229 for Liberty Select Value Fund, Variable Series; $17,254 of its
advisory fee and assumed additional expenses of $21,118 for Liberty Newport
Japan Opportunities Fund, Variable Series.
E-2
147
(2) For the fiscal year ended December 31, 2000, Liberty Funds Distributor, Inc.
waived $1,142 of its distribution fee for Colonial U.S. Growth & Income
Fund, Variable Series; $229 of its distribution fee for Colonial Strategic
Income Fund, Variable Series; $45 of its distribution fee for Liberty Value
Fund, Variable Series; $1,496 of its distribution fee for Liberty All-Star
Equity Fund, Variable Series; $1,641 of its distribution fee for Colonial
Small Cap Value Fund, Variable Series; $797 of its distribution fee for
Colonial High Yield Securities Fund, Variable Series; $11,552 of its
distribution fee for Liberty S&P 500 Index Fund, Variable Series; $2,518 of
its distribution fee for Rydex Health Care Fund, Variable Series; $2,157 of
its distribution fee for Rydex Financial Services Fund, Variable Series;
$3,798 of its distribution fee for Liberty Select Value Fund, Variable
Series; $3,222 of its distribution fee for Liberty Newport Japan
Opportunities Fund, Variable Series and $1,228 of its distribution fee for
Stein Roe Balanced Fund, Variable Series.
E-3
148
APPENDIX F
SHARES OUTSTANDING AND ENTITLED TO VOTE
For each class of the Fund's shares entitled to vote at the Meeting, the number
of shares outstanding as of July 16, 2001 was as follows:
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING AND
NAME OF FUND ENTITLED TO VOTE PER CLASS
- ------------ ---------------------------------
LIBERTY VARIABLE INVESTMENT TRUST
Colonial Global Equity Fund, Class A 97.087
Variable Series Class B 975,599.166
Colonial High Yield Securities
Fund, Class A 2,533,570.921
Variable Series Class B 795,693.988
Colonial International Fund for Class A 30,307,992.738
Growth, Variable Series Class B 487.017
Colonial International Horizons
Fund, Class A 95.969
Variable Series Class B 1,166,689.862
Colonial Small Cap Value Fund, Class A 759,937.449
Variable Series Class B 588,736.525
Colonial Strategic Income Fund, Class A 13,833,184.944
Variable Series Class B 1,336,064.497
Colonial U.S. Growth & Income
Fund, Class A 10,587,215.050
Variable Series Class B 812,328.785
Crabbe Huson Real Estate
Investment Class A 117.953
Fund, Variable Series Class B 478,264.423
Liberty All-Star Equity Fund, Class A 5,186,690.439
Variable Series Class B 394,728.483
Liberty Newport Japan
Opportunities, Class A 8,333.333
Variable Series Class B 209,380.839
Liberty S&P 500 Index Fund, Class A 8,373.573
Variable Series Class B 2,168,632.674
Liberty Select Value Fund, Class A 8,412.187
Variable Series Class B 712,340.371
Liberty Value Fund, Variable
Series Class A 11,528,261.973
Class B 343,818.306
Newport Tiger Fund, Variable
Series Class A 19,169,943.745
Class B 482,092.270
Rydex Financial Services Fund, Class A 8,399.562
Variable Series Class B 293,865.405
Rydex Health Care Fund, Class A 8,333.333
Variable Series Class B 445,681.452
</Table>
F-1
149
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING AND
NAME OF FUND ENTITLED TO VOTE PER CLASS
- ------------ ---------------------------------
Stein Roe Global Utilities Fund, Class A 5,915,027.036
Variable Series Class B 72.624
STEINROE VARIABLE INVESTMENT TRUST
Liberty Federal Securities Fund, Class A 10,101,843.428
Variable Series Class B 2,546,977.171
Stein Roe Balanced Fund, Class A 22,391,292.627
Variable Series Class B 2,629,937.803
Stein Roe Growth Stock Fund, Class A 8,979,383.778
Variable Series Class B 1,024,967.458
Stein Roe Money Market Fund,
Variable Series Class A 252,982,431.529
Stein Roe Small Company Growth Class A 9,554,632.630
Fund, Variable Series Class B 98.010
</Table>
OWNERSHIP OF SHARES
All of the shares of the Funds are held of record by sub-accounts of separate
accounts of Participating Insurance Companies on behalf of the owners of VA
contracts and VLI policies or by the general account of Keyport. At all meetings
of shareholders of the Funds, each Participating Insurance Company will vote the
shares held of record by sub-accounts of its separate accounts as to which
instructions are received from the VA contract and VLI policy owners on behalf
of whom such shares are held only in accordance with such instructions. All such
shares as to which no instructions are received (as well as, in the case of
Keyport, all shares held by its general account) will be voted in the same
proportion as shares as to which instructions are received (with Keyport's
general account shares being voted in the proportions determined by instructing
owners of Keyport VA contracts and VLI policies). There is no requirement as to
the minimum level of instructions which must be received from policy and
contract owners. Accordingly, each Participating Insurance Company and Keyport
disclaims beneficial ownership of the shares of the Funds held of record by the
sub-accounts of their respective separate accounts (or, in the case of Keyport,
its general account). As of July 16, 2001, to the knowledge of the Funds, there
were no holders of record of variable annuity contracts or variable life
insurance policies who beneficially had the right to vote 5% or more of the
outstanding shares of a Fund. Each Participating Insurance Company
F-2
150
disclaims beneficial ownership of the shares of the Funds held of record by the
sub-accounts of its separate accounts.
As of July 16, 2001, the Trusts believe that the Trustees and officers of the
Trusts, as a group, owned less than one percent of each class of shares of the
Funds and of the Trusts as a whole. As of record on July 16, 2001, the following
persons were known to own of record or beneficially 5% or more of one or more of
each class of the following Funds' then outstanding shares:
LVIT FUNDS
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
COLONIAL GLOBAL EQUITY FUND, VARIABLE SERIES
CLASS A
Colonial Management
Associates, Inc....... 97.087 100.00%
One Financial Center
Boston, Massachusetts
02111
CLASS B
Keyport Benefit Life
Insurance Company..... 98,443.450 10.09%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 375,061.620 38.44%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 502,094.096 51.47%(*)
125 High Street
Boston, Massachusetts
02110
COLONIAL HIGH YIELD SECURITIES FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 270,542.864 10.68%
125 High Street
Boston, Massachusetts
02110
</Table>
F-3
151
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Life Insurance
Company............... 1,625,164.573 64.15%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 618,882.019 24.43%
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 150,503.999 18.92%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 645,062.496 81.07%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
COLONIAL INTERNATIONAL FUND FOR GROWTH, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 22,616,154.852 74.62%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 5,208,657.397 17.19%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Colonial Management
Associates, Inc....... 487.017 100.00%
One Financial Center
Boston, Massachusetts
02111
</Table>
F-4
152
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
COLONIAL INTERNATIONAL HORIZONS FUND, VARIABLE SERIES
CLASS A
Colonial Management
Associates, Inc....... 95.969 100.00%
One Financial Center
Boston, Massachusetts
02111
CLASS B
Keyport Benefit Life
Insurance Company..... 82,287.603 7.05%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 680,691.621 58.34%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 403,710.638 34.60%(*)
125 High Street
Boston, Massachusetts
02110
COLONIAL SMALL CAP VALUE FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 80,012.260 10.53%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 455,542.676 59.95%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 204,406.808 26.90%
125 High Street
Boston, Massachusetts
02110
</Table>
F-5
153
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
CLASS B
Keyport Benefit Life
Insurance Company..... 89,105.282 15.14%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 499,519.346 84.85%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
COLONIAL STRATEGIC INCOME FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 997,545.609 7.21%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 9,145,590.063 66.11%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 2,767,207.530 20.00%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 187,867.114 14.06%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 1,148,088.325 85.93%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
</Table>
F-6
154
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
COLONIAL U.S. GROWTH & INCOME FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 708,872.710 6.70%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 6,321,112.776 59.71%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 2,494,227.702 23.56%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 137,109.788 16.88%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 675,161.445 83.11%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
CRABBE HUSON REAL ESTATE INVESTMENT FUND, VARIABLE SERIES
CLASS A
Colonial Management
Associates, Inc....... 117.953 100.00%
One Financial Center
Boston, Massachusetts
02111
CLASS B
Keyport Benefit Life
Insurance Company..... 40,372.450 8.44%
125 High Street
Boston, Massachusetts
02110
</Table>
F-7
155
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Life Insurance
Company............... 219,649.859 45.93%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 218,242.114 45.63%(*)
125 High Street
Boston, Massachusetts
02110
LIBERTY ALL-STAR EQUITY FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 424,599.722 8.19%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 4,593,031.633 88.55%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Life Insurance
Company............... 47,016.079 11.91%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 347,627.996 88.07%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
LIBERTY NEWPORT JAPAN OPPORTUNITIES FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 8,333.333 100.00%(*)
125 High Street
Boston, Massachusetts
02110
</Table>
F-8
156
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
CLASS B
Keyport Life Insurance
Company............... 200,000.000 95.52%(*)
125 High Street
Boston, Massachusetts
02110
LIBERTY S&P 500 INDEX FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 8,373.573 100.00%
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 291,237.157 13.43%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 1,467,088.692 67.65%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 410,306.825 18.92%
125 High Street
Boston, Massachusetts
02110
LIBERTY SELECT VALUE FUND, VARIABLE SERVICES
CLASS A
Keyport Life Insurance
Company............... 8,412.187 100.00%
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 45,123.525 6.34%
125 High Street
Boston, Massachusetts
02110
</Table>
F-9
157
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Life Insurance
Company............... 507,385.279 71.23%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 159,831.567 22.44%
125 High Street
Boston, Massachusetts
02110
LIBERTY VALUE FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 700,947.239 6.08%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 6,327,720.217 54.89%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 3,726,015.085 32.32%(*)
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Life Insurance
Company............... 311,408.574 90.57%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Benefit Life
Insurance Company..... 32,335.656 9.41%
125 High Street
Boston, Massachusetts
02110
</Table>
F-10
158
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
NEWPORT TIGER FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 5,150,827.534 26.87%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 3,697,872.725 19.29%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
Lincoln National Life... 3,407,461.471 17.78%
P.O. Box 1110
Fort Wayne, Indiana
46801-1110
Keyport Life Insurance
Company............... 5,358,459.749 27.95%(*)
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 30,698.668 6.37%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 450,946.989 93.54%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
RYDEX FINANCIAL SERVICES FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 8,399.562 100.00%(*)
125 High Street
Boston, Massachusetts
02110
</Table>
F-11
159
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
CLASS B
Keyport Benefit Life
Insurance Company..... 47,537.475 16.18%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 170,731.866 58.10%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 75,596.061 25.73%(*)
125 High Street
Boston, Massachusetts
02110
RYDEX HEALTH CARE FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 8,333.333 100.00%
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Benefit Life
Insurance Company..... 64,423.893 14.46%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 306,257.559 68.72%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 75,000.000 16.83%
125 High Street
Boston, Massachusetts
02110
</Table>
F-12
160
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
STEIN ROE GLOBAL UTILITIES FUND, VARIABLE SERIES
CLASS A
Keyport Benefit Life
Insurance Company..... 419,186.049 7.09%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 3,192,420.975 53.97%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 1,989,538.666 33.64%(*)
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Colonial Management
Associates, Inc....... 72.624 100.00%
One Financial Center
Boston, Massachusetts
02111
SRVIT FUNDS
LIBERTY FEDERAL SECURITIES FUND, VARIABLE SERIES
CLASS A
Independence Life and
Annuity Company....... 1,872,613.441 18.54%
695 George Washington
Highway
Lincoln, Rhode Island
02865-4257
Keyport Life Insurance
Company............... 4,900,052.073 48.51%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
</Table>
F-13
161
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Life Insurance
Company............... 2,490,186.166 24.65%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Life Insurance
Company............... 2,184,641.035 85.77%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Benefit Life
Insurance Company..... 362,228.140 14.22%
125 High Street
Boston, Massachusetts
02110
STEIN ROE BALANCED FUND, VARIABLE SERIES
CLASS A
Independence Life and
Annuity Company....... 1,891,180.460 8.45%
695 George Washington
Highway
Lincoln, Rhode Island
02865-4257
Keyport Life Insurance
Company............... 9,078,033.068 40.54%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 9,221,163.723 41.18%(*)
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Life Insurance
Company............... 2,326,017.551 88.44%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
</Table>
F-14
162
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Benefit Life
Insurance Company..... 303,853.992 11.55%
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 3,365,271.011 37.48%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 3,508,979.788 39.08%(*)
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Keyport Life Insurance
Company............... 848,534.107 82.79%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Benefit Life
Insurance Company..... 176,409.550 17.21%
125 High Street
Boston, Massachusetts
02110
STEIN ROE GROWTH STOCK FUND, VARIABLE SERIES
CLASS A
Independence Life and
Annuity Company....... 1,372,527.644 15.29%
695 George Washington
Highway
Lincoln, Rhode Island
02865-4257
STEIN ROE MONEY MARKET FUND, VARIABLE SERIES
CLASS A
Keyport Life Insurance
Company............... 164,892,087.169 65.18%(*)
Variable Account A
125 High Street
Boston, Massachusetts
02110
</Table>
F-15
163
<Table>
<Caption>
NUMBER OF SHARES PERCENTAGE OF OUTSTANDING
FUND AND CLASS OWNED SHARES OF CLASS OWNED
- -------------- ------------------- -------------------------
Keyport Life Insurance
Company............... 47,299,766.277 18.70%
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
Keyport Benefit Life
Insurance Company..... 24,075,351.083 9.52%
125 High Street
Boston, Massachusetts
02110
STEIN ROE SMALL COMPANY GROWTH FUND, VARIABLE SERIES FUNDS
CLASS A
Keyport Life Insurance
Company............... 1,039,009.254 10.87%
Variable Account A
125 High Street
Boston, Massachusetts
02110
Keyport Life Insurance
Company............... 7,398,695.165 77.44%(*)
KMA Variable Account
125 High Street
Boston, Massachusetts
02110
CLASS B
Colonial Management
Associates, Inc....... 98.010 100.00%
One Financial Center
Boston, Massachusetts
02111
</Table>
(*) As of record on July 16, 2001, this Participating Insurance Company owned
25% or more of the then outstanding shares of the Fund indicated and,
therefore, may be deemed to "control" the Fund
F-16
164
APPENDIX G
TRUSTEE INFORMATION
The following table sets forth certain information about the Board of Trustees
of Liberty Variable Investment Trust:
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
Douglas A. Hacker 2000 Executive Vice (2)
(45) President and Chief
Financial Officer of
UAL, Inc. (airline)
since July, 1999;
Senior Vice President
and Chief Financial
Officer of UAL, Inc.
prior thereto.
Janet Langford Kelly 2000 Executive Vice (2)
(43) President -- Corporate
Development and
Administration,
General Counsel, and
Secretary, Kellogg
Company (food
manufacturer) since
September, 1999;
Senior Vice
President, Secretary
and General Counsel,
Sara Lee Corporation
(branded, packaged,
consumer-products
manufacturer) prior
thereto.
</Table>
G-1
165
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
Richard W. Lowry (65) 1995 Private Investor (2)
since August, 1987
(formerly Chairman
and Chief Executive
Officer, U.S. Plywood
Corporation (building
products
manufacturer)).
Salvatore Macera 1998 Private Investor (2)
(70) since 1981 (formerly
Executive Vice
President and
Director of Itek
Corporation
(electronics) from
1975 to 1981).
</Table>
G-2
166
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
William E. Mayer(3) 1994 Managing Partner, (2)
(61) Park Avenue Equity
Partners (venture
capital) since 1998
(formerly Founding
Partner, Development
Capital LLC from
November, 1996 to
1998; Dean and
Professor, College of
Business and
Management,
University of
Maryland from
October, 1992 to
November, 1996);
Director: Lee
Enterprises (print
and on-line media);
WR Hambrecht + Co
(financial service
provider); Systech
Retail Systems
(retail industry
technology provider).
Charles R. Nelson 2000 Van Voorhis (2)
(58) Professor, Department
of Economics,
University of
Washington;
consultant on
econometric and
statistical matters.
</Table>
G-3
167
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
John J. Neuhauser 1985 Academic Vice (2)
(58) President and Dean of
Faculties since
August, 1999, Boston
College (formerly
Dean, Boston College
School of Management
from September, 1977
to September, 1999);
Director, Saucony,
Inc. (athletic
footwear).
</Table>
G-4
168
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
Joseph R. Palombo(4) 2000 Chief Operations (2)
(48) Officer of Mutual
Funds, Liberty
Financial since
August, 2000;
Executive Vice
President and
Director of Colonial
since April, 1999;
Executive Vice
President and Chief
Administrative
Officer of LFG since
April, 1999; Director
of Stein Roe since
September, 2000;
Trustee and Chairman
of the Board of Stein
Roe Mutual Funds
since October, 2000;
Manager of Stein Roe
Floating Rate Limited
Liability Company
since October, 2000
(formerly Vice
President of the
Liberty Funds from
April 1999 to August,
2000; Chief Operating
Officer, Putnam
Mutual Funds from
1994 to 1998).
</Table>
G-5
169
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
Thomas E. Stitzel 1998 Business Consultant (2)
(65) since 1999; (formerly
Professor of Finance
from 1975 to 1999 and
Dean from 1977 to
1991, College of
Business, Boise State
University);
Chartered Financial
Analyst.
Thomas C. Theobald 2000 Managing Director, (2)
(64) William Blair Capital
Partners (private
equity investing)
since 1994; (formerly
Chief Executive
Officer and Chairman
of the Board of
Directors,
Continental Bank
Corporation);
Director of Xerox
Corporation (business
products and
services), Anixter
International
(network support
equipment
distributor), Jones
Lang LaSalle (real
estate management
services) and MONY
Group (life
insurance).
</Table>
G-6
170
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
BENEFICIALLY
OWNED AT
NAME TRUSTEE PRINCIPAL OCCUPATION JULY 16,
(AGE) SINCE AND DIRECTORSHIPS(1) 2001
- ----- ------- -------------------- ------------
Anne-Lee Verville 1998 Chairman of the Board (2)
(56) of Directors, Enesco
Group, Inc.
(designer, importer
and distributor of
giftware and
collectibles);
Director,
LearnSomething.com,
Inc. (online
educational products
and services) since
2000; author and
speaker on
educational systems
needs; (formerly
General Manager,
Global Education
Industry from 1994 to
1997, and President,
Applications
Solutions Division
from 1991 to 1994,
IBM Corporation
(global education and
global
applications)).
</Table>
(1)Except as otherwise noted, each individual has held the office indicated or
other offices in the same company for the last five years.
(2)On July 16, 2001, the Trustees and Officers of each Fund as a group
beneficially owned less than 1% of the then outstanding shares of each Fund.
(3)Mr. Mayer is an "interested person," as defined in the Investment Company
Act, because he is a Director of WR Hambrecht + Co. (a registered
broker-dealer).
(4)Mr. Palombo is an "interested person," as defined in the Investment Company
Act because he is an affiliate of each Fund's investment advisor and an
employee of certain affiliates of the Advisors.
G-7
171
As of December 31, 2000, the Stein Roe Funds Complex consisted of the Liberty
Floating Rate Fund, the Stein Roe Floating Rate Limited Liability Company,
Liberty-Stein Roe Institutional Floating Rate Income Fund, and the following
open-end mutual funds: 4 series of Liberty -- Stein Roe Funds Income Trust, 1
series of Liberty -- Stein Roe Funds Trust, 4 series of Liberty -- Stein Roe
Funds Municipal Trust, 12 series of Liberty -- Stein Roe Funds Investment Trust,
4 series of Liberty -- Stein Roe Advisor Trust, 5 series of SteinRoe Variable
Investment Trust, and 12 portfolios of SR&F Base Trust (together, the "Stein Roe
Funds Complex").
At December 31, 2000, the Liberty Funds Complex consisted of 49 open-end and 9
closed-end management investment portfolios in the Liberty Funds Group -- Boston
and 17 open-end management investment portfolios in the Liberty Variable
Investment Trust (together, the "Liberty Funds Complex").
On December 27, 2000, the Liberty Funds Complex and the Stein Roe Funds Complex
were combined and reorganized into one fund complex. Effective on December 27,
2000, the Trustees listed above serve as Trustees for all the Funds in both the
Liberty Funds Complex and the Stein Roe Funds Complex except for the SteinRoe
Variable Investment Trust. The Trustees, except Ms. Kelly and Messrs. Hacker,
Nelson and Theobald, listed above, began serving as Trustees for the SteinRoe
Variable Investment Trust on April 5, 2001. Ms. Kelly and Messrs. Hacker, Nelson
and Theobald served as Trustees for the SteinRoe Variable Investment Trust prior
to April 5, 2001. The Trustees listed above, except Ms. Kelly and Messrs.
Hacker, Nelson and Theobald, began serving as trustees for the SteinRoe Variable
Investment Trust on April 5, 2001. Ms. Kelly and Messrs. Hacker, Nelson, and
Theobald served as Trustees for the SteinRoe Variable Investment Trust prior to
April 5, 2001.
G-8
172
APPENDIX H
OFFICER INFORMATION
The following table sets forth certain information about the executive officers
of Liberty Variable Investment Trust:
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
Stephen E. Gibson 1998 President of the Fund (2)
(47) Complex since November
1998; President of the
Liberty Funds since June,
1998; Chairman of the
Board since July, 1998,
Chief Executive Officer
and President since
December, 1996 and
Director, since July,
1996, of Colonial
(formerly Executive Vice
President from July, 1996
to December, 1996);
Director, Chief Executive
Officer and President,
LFG since December, 1998
(formerly Director, Chief
Executive Officer and
President, The Colonial
Group, Inc. (TCG) from
December, 1996 to
December, 1998);
President since January,
2000 and Director, since
September, 2000, SR&F
(formerly Vice Chairman
from January, 2000 to
September, 2000 and
Assistant Chairman from
August, 1998 to January,
2000); Managing Director
of Marketing, Putnam
Investments prior
thereto.
</Table>
H-1
173
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
J. Kevin Connaughton 2000 Treasurer of the Liberty (2)
(37) Funds Complex and of the
Liberty All-Star Funds
since December, 2000
(formerly Controller of
the Liberty Funds Complex
and of the Liberty
All-Star Funds from
February, 1998 to
October, 2000); Treasurer
of the Stein Roe Funds
Complex since February
2001 (formerly Controller
from May, 2000 to
February, 2001) Vice
President of Colonial
since February, 1998
(formerly Senior Tax
Manager, Coopers &
Lybrand, LLP from April,
1996 to January, 1998;
Vice President, 440
Financial Group/First
Data Investor Services
Group from March, 1994 to
April, 1996).
</Table>
H-2
174
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
William J. Ballou 2000 Secretary of the Liberty (2)
(36) Funds Complex and of the
Liberty All-Star Funds
since October, 2000
(formerly Assistant
Secretary from October,
1997 to October, 2000);
Secretary of the Stein
Roe Funds Complex since
February, 2001 (formerly
Assistant Secretary from
May, 2000 to February,
2001); Senior Vice
President of Colonial
since April, 2001
(formerly Vice President
from October, 1997 to
March, 2001); Senior
Counsel of Colonial since
April, 2000 (formerly
Counsel from October,
1997 to March, 2000);
Assistant Secretary of
Colonial since October,
1997; Senior Vice
President of LFG since
April, 2001 (formerly
Vice President and
Counsel from October,
1997 to March 2001);
Senior Counsel of LFG
since April, 2000 and
Assistant Secretary since
December, 1998 of LFG
(formerly Associate
Counsel, Massachusetts
Financial Services
Company from May, 1995 to
September, 1997).
</Table>
H-3
175
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
Kevin M. Carome 1999 Executive Vice President (2)
(45) of Liberty Funds Complex
and of the Liberty
All-Star Funds since
October, 2000; Executive
Vice President of the
Stein Roe Funds Complex
since May, 1999 (formerly
Vice President from
April, 1998 to May, 1999,
Assistant Secretary from
April, 1998 to February,
2000 and Secretary from
February, 2000 to May,
2000); Chief Legal
Officer of Liberty
Financial since August,
2000; Senior Vice
President, Legal since
January, 1999 of LFG;
Executive Vice President
and Assistant Secretary
of Stein Roe since
January, 2001 (formerly
General Counsel and
Secretary of Stein Roe
from January, 1998 to
December, 1999);
(formerly Vice President
and Associate General
Counsel of Liberty
Financial from August,
1993 to December, 1998).
</Table>
H-4
176
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
Michelle G. Azrialy 2001 Controller of the Liberty (2)
(32) Funds and of the Liberty
All-Star Funds since May,
2001; Vice President of
LFG since March, 2001
(formerly Assistant Vice
President of Fund
Administration from
September, 2000 to
February, 2001;
Compliance Manager of
Fund Administration from
September, 1999 to
August, 2000) (formerly
Assistant Treasurer,
Chase Global Fund
Services -- Boston from
August, 1996 to
September, 1999; Senior
Accountant,
PricewaterhouseCoopers
LLP from June, 1991 to
July, 1994).
</Table>
H-5
177
<Table>
<Caption>
SHARES AND
PERCENT OF
EACH FUND
EXECUTIVE BENEFICIALLY
NAME OFFICER OFFICE WITH FUND; OWNED AT
(AGE) SINCE PRINCIPAL OCCUPATION(1) JULY 16, 2001
- ----- --------- ----------------------- -------------
Vicki Benjamin 2001 Chief Accounting Officer (2)
(39) of the Liberty Funds,
Stein Roe Funds and
Liberty All-Star Funds
since June, 2001; Vice
President of LFG since
April, 2001 (formerly
Vice President, Corporate
Audit, State Street Bank
and Trust Company from
May, 1998 to April, 2001;
Senior Audit Manager,
Coopers & Lybrand from
December, 1989 to May,
1998).
</Table>
- ---------------
(1)Except as otherwise noted, each individual has held the office indicated or
other offices in the same company for the last five years.
(2)On July 16, 2001, the Trustees and officers of each Fund as a group
beneficially owned less than 1% of the then outstanding shares of the Fund.
H-6
178
APPENDIX I
TRUSTEES' COMPENSATION
In this Appendix, the following acronym codes will be used to identify each of
the Funds:
<Table>
<Caption>
- ---------------------------------------------------------------------------
CODE FUND CODE FUND
- ---------------------------------------------------------------------------
CGEF Colonial Global Equity LVF Liberty Value Fund,
Fund, Variable Series Variable Series
- ---------------------------------------------------------------------------
CHYSF Colonial High Yield NTF Newport Tiger Fund,
Securities Fund, Variable Variable Series
Series
- ---------------------------------------------------------------------------
CIFfG Colonial International Fund RFSF Rydex Financial Services
for Growth, Variable Series Fund, Variable Series
- ---------------------------------------------------------------------------
CIHF Colonial International RHCF Rydex Health Care Fund,
Horizons Fund, Variable Variable Series
Series
- ---------------------------------------------------------------------------
CSCVF Colonial Small Cap Value SRGUF Stein Roe Global Utilities
Fund, Variable Series Fund, Variable Series
- ---------------------------------------------------------------------------
CSIF Colonial Strategic Income
Fund, Variable Series
- ---------------------------------------------------------------------------
CUSGIF Colonial U.S. Growth & LFSF Liberty Federal Securities
Income Fund, Variable Fund, Variable Series
Series
- ---------------------------------------------------------------------------
CHREIF Crabbe Huson Real Estate SRBF Stein Roe Balanced Fund,
Investment Fund, Variable Variable Series
Series
- ---------------------------------------------------------------------------
LASEF Liberty All-Star Equity SRGSF Stein Roe Growth Stock
Fund, Variable Series Fund, Variable Series
- ---------------------------------------------------------------------------
LNJOF Liberty Newport Japan SRMMF Stein Roe Money Market
Opportunities Fund, Fund, Variable Series
Variable Series
- ---------------------------------------------------------------------------
LSPF Liberty S&P 500 Index Fund, SRSCGF Stein Roe Small Company
Variable Series Growth Fund, Variable
Series
- ---------------------------------------------------------------------------
LSVF Liberty Select Value Fund,
Variable Series
- ---------------------------------------------------------------------------
</Table>
I-1
179
For the fiscal and calendar year ended December 31, 2000, the Trustees received
the following compensation for serving as Trustees(1):
LVIT FUNDS
<Table>
<Caption>
- -------------------------------------------------------------------------------------------------
CGEF CHYSF CIFFG CIHF
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM THE FUND FROM THE FUND FROM THE FUND FROM THE FUND
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
TRUSTEE 2000 2000 2000 2000
- -------------------------------------------------------------------------------------------------
Tom Bleasdale(2) $536(3) $570(4) $784(5) $539(6)
- -------------------------------------------------------------------------------------------------
John V. Carberry(7) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Lora S. Collins(2) 485 516 709 488
- -------------------------------------------------------------------------------------------------
James E. Grinnell(2) 516 548 753 519
- -------------------------------------------------------------------------------------------------
Douglas A. Hacker(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Janet Langford Kelly(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Richard W. Lowry 501 532 731 504
- -------------------------------------------------------------------------------------------------
Salvatore Macera 495 526 723 498
- -------------------------------------------------------------------------------------------------
William E. Mayer 506 537 739 509
- -------------------------------------------------------------------------------------------------
James L. Moody, Jr.(2) 531(9) 564(10) 776(11) 534(12)
- -------------------------------------------------------------------------------------------------
Charles R. Nelson(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
John J. Neuhauser 514 546 750 518
- -------------------------------------------------------------------------------------------------
Joseph R. Palombo(13) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Thomas E. Stitzel 490 521 717 494
- -------------------------------------------------------------------------------------------------
Robert L. Sullivan(14) 185 194 266 185
- -------------------------------------------------------------------------------------------------
Thomas C. Theobald(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Anne-Lee Verville 479(15) 509(16) 699(17) 482(18)
- -------------------------------------------------------------------------------------------------
</Table>
I-2
180
<Table>
<Caption>
- -------------------------------------------------------------------------------------------------
CSCVF CSIF CUSGIF CHREIF
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM THE FUND FROM THE FUND FROM THE FUND FROM THE FUND
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
TRUSTEE 2000 2000 2000 2000
- -------------------------------------------------------------------------------------------------
Tom Bleasdale(2) $524(19) $1,121(20) $1,282(21) $513(22)
- -------------------------------------------------------------------------------------------------
John V. Carberry(7) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Lora S. Collins(2) 474 1,015 1,161 465
- -------------------------------------------------------------------------------------------------
James E. Grinnell(2) 504 1,078 1,234 494
- -------------------------------------------------------------------------------------------------
Douglas A. Hacker(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Janet Langford Kelly(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Richard W. Lowry 489 1,047 1,198 479
- -------------------------------------------------------------------------------------------------
Salvatore Macera 484 1,035 1,186 474
- -------------------------------------------------------------------------------------------------
William E. Mayer 494 1,057 1,210 484
- -------------------------------------------------------------------------------------------------
James L. Moody, Jr.(2) 519(23) 1,110(24) 1,270(25) 509(26)
- -------------------------------------------------------------------------------------------------
Charles R. Nelson(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
John J. Neuhauser 503 1,072 1,225 493
- -------------------------------------------------------------------------------------------------
Joseph R. Palombo(13) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Thomas E. Stitzel 479 1,025 1,173 470
- -------------------------------------------------------------------------------------------------
Robert L. Sullivan(14) 181 375 412 180
- -------------------------------------------------------------------------------------------------
Thomas C. Theobald(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Anne-Lee Verville 468(27) 1,001(28) 1,146(29) 459(30)
- -------------------------------------------------------------------------------------------------
</Table>
I-3
181
<Table>
<Caption>
- -------------------------------------------------------------------------------------------------
LASEF LNJOF LSPF LSVF
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM THE FUND FROM THE FUND FROM THE FUND FROM THE FUND
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
TRUSTEE 2000 2000 2000 2000
- -------------------------------------------------------------------------------------------------
Tom Bleasdale(2) $762(31) $181(32) $187(33) $181(34)
- -------------------------------------------------------------------------------------------------
John V. Carberry(7) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Lora S. Collins(2) 691 169 175 169
- -------------------------------------------------------------------------------------------------
James E. Grinnell(2) 735 181 187 181
- -------------------------------------------------------------------------------------------------
Douglas A. Hacker(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Janet Langford Kelly(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Richard W. Lowry 712 171 177 171
- -------------------------------------------------------------------------------------------------
Salvatore Macera 706 175 181 175
- -------------------------------------------------------------------------------------------------
William E. Mayer 720 174 180 174
- -------------------------------------------------------------------------------------------------
James L. Moody, Jr.(2) 755(35) 181(36) 187(37) 181(38)
- -------------------------------------------------------------------------------------------------
Charles R. Nelson(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
John J. Neuhauser 731 177 183 176
- -------------------------------------------------------------------------------------------------
Joseph R. Palombo(13) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Thomas E. Stitzel 698 169 175 169
- -------------------------------------------------------------------------------------------------
Robert L. Sullivan(14) 259 0 0 0
- -------------------------------------------------------------------------------------------------
Thomas C. Theobald(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Anne-Lee Verville 682(39) 163(40) 168(41) 162(42)
- -------------------------------------------------------------------------------------------------
</Table>
I-4
182
<Table>
<Caption>
- -------------------------------------------------------------------------------------------------
LVF NTF RFSF RHCF
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM THE FUND FROM THE FUND FROM THE FUND FROM THE FUND
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
TRUSTEE 2000 2000 2000 2000
- -------------------------------------------------------------------------------------------------
Tom Bleasdale(2) $1,220(43) $686(44) $179(45) $179(46)
- -------------------------------------------------------------------------------------------------
John V. Carberry(7) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Lora S. Collins(2) 1,106 621 167 167
- -------------------------------------------------------------------------------------------------
James E. Grinnell(2) 1,175 660 179 179
- -------------------------------------------------------------------------------------------------
Douglas A. Hacker(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Janet Langford Kelly(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Richard W. Lowry 1,140 640 169 169
- -------------------------------------------------------------------------------------------------
Salvatore Macera 1,129 634 174 174
- -------------------------------------------------------------------------------------------------
William E. Mayer 1,152 647 173 173
- -------------------------------------------------------------------------------------------------
James L. Moody, Jr.(2) 1,209(47) 679(48) 179(49) 179(50)
- -------------------------------------------------------------------------------------------------
Charles R. Nelson(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
John J. Neuhauser 1,167 657 175 175
- -------------------------------------------------------------------------------------------------
Joseph R. Palombo(13) N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------
Thomas E. Stitzel 1,117 627 167 167
- -------------------------------------------------------------------------------------------------
Robert L. Sullivan(14) 401 227 0 0
- -------------------------------------------------------------------------------------------------
Thomas C. Theobald(8) 0 0 0 0
- -------------------------------------------------------------------------------------------------
Anne-Lee Verville 1,092(51) 612(52) 161(53) 161(54)
- -------------------------------------------------------------------------------------------------
</Table>
I-5
183
<Table>
<Caption>
- ---------------------------------------------------------------------------------------
SRGUF
AGGREGATE TOTAL COMPENSATION FROM
COMPENSATION THE LIBERTY FUNDS COMPLEX
FROM THE FUND FOR THE PAID TO THE TRUSTEES FOR THE
FISCAL YEAR ENDED CALENDAR YEAR ENDED
TRUSTEE DECEMBER 31, 2000 DECEMBER 31, 2000(55)
- ---------------------------------------------------------------------------------------
Tom Bleasdale(2) $926(56) $106,000(57)
- ---------------------------------------------------------------------------------------
John V. Carberry(7) N/A N/A
- ---------------------------------------------------------------------------------------
Lora S. Collins(2) 837 96,000
- ---------------------------------------------------------------------------------------
James E. Grinnell(2) 890 102,000
- ---------------------------------------------------------------------------------------
Douglas A. Hacker(8) 0 0
- ---------------------------------------------------------------------------------------
Janet Langford Kelly(8) 0 0
- ---------------------------------------------------------------------------------------
Richard W. Lowry 864 99,000
- ---------------------------------------------------------------------------------------
Salvatore Macera 855 98,000
- ---------------------------------------------------------------------------------------
William E. Mayer 872 100,000
- ---------------------------------------------------------------------------------------
James L. Moody, Jr.(2) 917(58) 105,000(59)
- ---------------------------------------------------------------------------------------
Charles R. Nelson(8) 0 0
- ---------------------------------------------------------------------------------------
John J. Neuhauser 885 101,210
- ---------------------------------------------------------------------------------------
Joseph R. Palombo(13) N/A N/A
- ---------------------------------------------------------------------------------------
Thomas E. Stitzel 846 97,000
- ---------------------------------------------------------------------------------------
Robert L. Sullivan(14) 299 34,033
- ---------------------------------------------------------------------------------------
Thomas C. Theobald(8) 0 0
- ---------------------------------------------------------------------------------------
Anne-Lee Verville 826(60) 94,667(61)
- ---------------------------------------------------------------------------------------
</Table>
(1)The LVIT Funds do not currently provide pension or retirement plan benefits
to the Trustees.
(2)Resigned as Trustee of LVIT and the Liberty Funds Complex on December 27,
2000.
(3)For the fiscal year ended December 31, 2000, compensation includes $266
payable in later years as deferred compensation.
(4)For the fiscal year ended December 31, 2000, compensation includes $281
payable in later years as deferred compensation.
(5)For the fiscal year ended December 31, 2000, compensation includes $388
payable in later years as deferred compensation.
(6)For the fiscal year ended December 31, 2000, compensation includes $267
payable in later years as deferred compensation.
I-6
184
(7)Resigned as Trustee of LVIT and the Liberty Funds Complex on August 4, 2000.
Mr. Carberry did not receive compensation because he was an affiliated
Trustee and employee of Liberty Financial.
(8)Elected by the Trustees of the other funds in the Liberty Funds Complex on
December 27, 2000.
(9)Total compensation of $531 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(10)Total compensation of $564 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(11)Total compensation of $776 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(12)Total compensation of $534 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(13)Elected by the Trustees of the other funds in the Liberty Funds Complex on
August 23, 2000. Mr. Palombo does not receive compensation because is an
affiliated Trustee and employee of Colonial.
(14)Retired as Trustee of the Trust and the Liberty Funds Complex on April 20,
2000.
(15)Total compensation of $479 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(16)Total compensation of $509 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(17)Total compensation of $699 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(18)Total compensation of $482 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(19)For the fiscal year ended December 31, 2000, compensation includes $259
payable in later years as deferred compensation.
(20)For the fiscal year ended December 31, 2000, compensation includes $554
payable in later years as deferred compensation.
(21)For the fiscal year ended December 31, 2000, compensation includes $628
payable in later years as deferred compensation.
(22)For the fiscal year ended December 31, 2000, compensation includes $256
payable in later years as deferred compensation.
(23)Total compensation of $519 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
I-7
185
(24)Total compensation of $1,110 for the fiscal year ended December 31, 2000,
was paid on January 31, 2001.
(25)Total compensation of $1,270 for the fiscal year ended December 31, 2000,
was paid on January 31, 2001.
(26)Total compensation of $509 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(27)Total compensation of $468 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(28)Total compensation of $1,001 for the fiscal year ended December 31, 2000,
will be payable in later years as deferred compensation.
(29)Total compensation of $1,146 for the fiscal year ended December 31, 2000,
will be payable in later years as deferred compensation.
(30)Total compensation of $459 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(31)For the fiscal year ended December 31, 2000, compensation includes $377
payable in later years as deferred compensation.
(32)For the fiscal year ended December 31, 2000, compensation includes $72
payable in later years as deferred compensation.
(33)For the fiscal year ended December 31, 2000, compensation includes $74
payable in later years as deferred compensation.
(34)For the fiscal year ended December 31, 2000, compensation includes $72
payable in later years as deferred compensation.
(35)Total compensation of $755 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(36)Total compensation of $181 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(37)Total compensation of $187 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(38)Total compensation of $181 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(39)Total compensation of $682 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(40)Total compensation of $163 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(41)Total compensation of $168 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(42)Total compensation of $162 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
I-8
186
(43)For the fiscal year ended December 31, 2000, compensation includes $602
payable in later years as deferred compensation.
(44)For the fiscal year ended December 31, 2000, compensation includes $337
payable in later years as deferred compensation.
(45)For the fiscal year ended December 31, 2000, compensation includes $71
payable in later years as deferred compensation.
(46)For the fiscal year ended December 31, 2000, compensation includes $71
payable in later years as deferred compensation.
(47)Total compensation of $1,209 for the fiscal year ended December 31, 2000,
was paid on January 31, 2001.
(48)Total compensation of $679 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(49)Total compensation of $179 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(50)Total compensation of $179 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(51)Total compensation of $1,092 for the fiscal year ended December 31, 2000,
will be payable in later years as deferred compensation.
(52)Total compensation of $612 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(53)Total compensation of $161 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(54)Total compensation of $161 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
(55)At December 31, 2000, the complex consisted of 49 open-end and 9 closed-end
management investment portfolios in the Liberty Funds Group -- Boston and 17
open-end management investment portfolios in LVIT (together, the "Liberty
Funds Complex").
(56)For the fiscal year ended December 31, 2000, compensation includes $454
payable in later years as deferred compensation.
(57)For the calendar year ended December 31, 2000, compensation includes $52,000
payable in later years as deferred compensation.
(58)Total compensation of $917 for the fiscal year ended December 31, 2000, was
paid on January 31, 2001.
(59)Total compensation of $105,000 for the calendar year ended December 31,
2000, was paid on January 31, 2001.
(60)Total compensation of $826 for the fiscal year ended December 31, 2000, will
be payable in later years as deferred compensation.
I-9
187
(61)Total compensation of $94,667 for the calendar year ended December 31, 2000,
will be payable in later years as deferred compensation.
SRVIT FUNDS
<Table>
<Caption>
- -----------------------------------------------------------------------------------------------
LFSF SRBF SRGSF SRMMF
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM THE FUND FROM THE FUND FROM THE FUND FROM THE FUND
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
TRUSTEE 2000 2000 2000 2000
- -----------------------------------------------------------------------------------------------
John A. Bacon, Jr.(2) $2,300 $2,900 $2,900 $2,300
- -----------------------------------------------------------------------------------------------
William W. Boyd(2) 2,400 3,000 3,000 2,400
- -----------------------------------------------------------------------------------------------
Douglas A. Hacker 2,300 2,900 2,900 2,300
- -----------------------------------------------------------------------------------------------
Janet Langford Kelly 2,200 2,800 2,800 2,200
- -----------------------------------------------------------------------------------------------
Richard W. Lowry(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
Salvatore Macera(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
William E. Mayer(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
Charles R. Nelson 2,300 2,900 2,900 2,300
- -----------------------------------------------------------------------------------------------
John J. Neuhauser(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
Joseph R. Palombo(4) N/A N/A N/A N/A
- -----------------------------------------------------------------------------------------------
Thomas E. Stitzel(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
Thomas C. Theobald 2,300 2,900 2,900 2,300
- -----------------------------------------------------------------------------------------------
Anne-Lee Verville(3) 0 0 0 0
- -----------------------------------------------------------------------------------------------
</Table>
I-10
188
<Table>
<Caption>
- -------------------------------------------------------------------------------------------
SRSCGF TOTAL COMPENSATION FROM THE
AGGREGATE STEIN ROE FUNDS COMPLEX
COMPENSATION PAID TO THE TRUSTEES FOR THE
FROM THE FUND FOR THE FISCAL CALENDAR YEAR ENDED
TRUSTEE YEAR ENDED DECEMBER 31, 2000 DECEMBER 31, 2000(5)
- -------------------------------------------------------------------------------------------
John A. Bacon, Jr.(2) $2,300 $ 98,100
- -------------------------------------------------------------------------------------------
William W. Boyd(2) 2,400 102,600
- -------------------------------------------------------------------------------------------
Douglas A. Hacker 2,300 98,100
- -------------------------------------------------------------------------------------------
Janet Langford Kelly 2,200 93,600
- -------------------------------------------------------------------------------------------
Richard W. Lowry(3) 0 0
- -------------------------------------------------------------------------------------------
Salvatore Macera(3) 0 0
- -------------------------------------------------------------------------------------------
William E. Mayer(3) 0 0
- -------------------------------------------------------------------------------------------
Charles R. Nelson 2,300 98,100
- -------------------------------------------------------------------------------------------
John J. Neuhauser(3) 0 0
- -------------------------------------------------------------------------------------------
Joseph R. Palombo(4) N/A N/A
- -------------------------------------------------------------------------------------------
Thomas E. Stitzel(3) 0 0
- -------------------------------------------------------------------------------------------
Thomas C. Theobald 2,300 98,100
- -------------------------------------------------------------------------------------------
Anne-Lee Verville(3) 0 0
- -------------------------------------------------------------------------------------------
</Table>
(1)The SRVIT Funds do not currently provide pension or retirement plan benefits
to the Trustees.
(2)Retired as Trustee of SRVIT and the Stein Roe Funds Complex on December 27,
2000.
(3)Elected by the shareholders of the SRVIT Funds on April 5, 2001.
(4)Elected by the Trustees of the Stein Roe Funds Complex on October 17, 2000.
Elected by the shareholders of the SRVIT Funds on April 5, 2001. Mr. Palombo
does not receive compensation because he is an affiliated Trustee and
employee of Colonial.
(5)As of December 31, 2000, the Stein Roe Funds Complex consisted of the Liberty
Floating Rate Fund, the Stein Roe Floating Rate Limited Liability Company,
Liberty-Stein Roe Institutional Floating Rate Income Fund, and the following
open-end mutual funds: 4 series of Liberty-Stein Roe Funds Income Trust, 4
series of Liberty-Stein Roe Funds Municipal Trust, 12 series of Liberty-Stein
Roe Funds Investment Trust, 4 series of Liberty-Stein Roe Advisor Trust, 1
series of Stein Roe Trust, 12 portfolios of SR&F Base Trust, and 5 series of
SRVIT.
I-11
189
For the calendar year ended December 31, 2000, some of the Trustees received the
following compensation in their capacities as trustees or directors of the
Liberty All-Star Equity Fund, the Liberty All-Star Growth Fund, Inc. and Liberty
Funds IX(1) (together, "Liberty All-Star Funds"(2)):
<Table>
<Caption>
TOTAL COMPENSATION FROM
LIBERTY ALL-STAR FUNDS FOR THE
CALENDAR YEAR ENDED
TRUSTEE DECEMBER 31, 2000(3)
- ------- ------------------------------
Robert J. Birnbaum $25,000
John V. Carberry(4) N/A
James E. Grinnell 25,000
Richard W. Lowry 25,000
William E. Mayer 25,000
John J. Neuhauser 25,000
Joseph R. Palombo(5) N/A
</Table>
(1)On January 25, 2001, the shareholders of Liberty All-Star Growth & Income
Fund, the only series of Liberty Funds Trust IX, approved the acquisition of
the Fund by Liberty Growth & Income Fund, one of the funds in the Liberty
Funds Complex. The Acquisition was effected on February 9, 2001.
(2)The Liberty All-Star Funds do not currently provide pension or retirement
plan benefits to the trustees/directors.
(3)The Liberty All-Star Funds are advised by LAMCO. LAMCO is an indirect wholly
owned subsidiary of Liberty Financial.
(4)Resigned as Trustee and Director of the Liberty All-Star Funds on August 4,
2000. Mr. Carberry did not receive compensation because he was an affiliated
Trustee and Director and employee of Liberty Financial.
(5)Elected by the Trustees and Directors of the Liberty All-Star Funds on
October 25, 2000. Mr. Palombo does not receive compensation because he is an
affiliated Trustee and Director and employee of Colonial.
I-12
190
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSEL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT P.
PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE FUND LISTED
ABOVE TO BE HELD AT 2:00 P.M. ON WEDNESDAY, SEPTEMBER 26, 2001, AT ONE FINANCIAL
CENTER, BOSTON, MASSACHUSETTS, AND AT ANY ADJOURNMENTS THEREOF.
DATE ______________
[ ]
SIGNATURE(S) (IF JOINT PARTICIPANT)
PLEASE SIGN YOUR NAME OR NAMES EXACTLY AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED ABOVE. WHERE SHARES ARE REGISTERED WITH JOINT
OWNERS, ALL JOINT OWNERS SHOULD SIGN. PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO INDICATE CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
SRVIT
191
* Please fold and detach card at perforation before mailing *
Please fill in box(es) as shown using black or blue ink or
number 2 pencil. PLEASE DO NOT USE FINE POINT PENS. [X]
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH PROPOSAL
AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE THEIR
DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL MEETING.
IF YOU DO NOT INTEND PERSONALLY TO ATTEND THIS SPECIAL MEETING, PLEASE COMPLETE
AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY
AGREEMENT. [ ] [ ] [ ]
2. BALANCED FUND ONLY: TO APPROVE A
NEW SUB-ADVISORY AGREEMENT WITH NORDEA
SECURITIES, INC. [ ] [ ] [ ]
3. TO CONSIDER AND ACT UPON ANY OTHER
MATTERS THAT PROPERLY COME BEFORE
THE MEETING AND ANY ADJOURNED SESSION
OF THE MEETING.
192
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST AND
STEINROE VARIABLE INVESTMENT TRUST.
** Please fold and detach card at perforation before mailing **
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company"), hereby instructs the Insurance Company to cause the
shares of each above-referenced fund (the "Fund") allocable to Participant's
contract or policy to be voted in the manner specified on the reverse side with
respect to the matter described in the accompanying proxy statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF EACH PROPOSAL.
** DATE ____________________________
PLEASE MARK, SIGN, DATE AND RETURN THE
VOTING INSTRUCTIONS CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
________________________________________
Signature(s) of joint participant
Please date and sign the name or names
as printed hereon. Where there are Joint
Participants, all Joint Participants
should sign. Corporate Instructions
should be signed by an authorized
officer. Executors, administrators,
trustees, etc. should so indicate when
signing.
** **
SRVIT-VIC
193
- Please fold and detach card at perforation before mailing -
- Please fill in box(es) as shown using black or blue ink or number 2 pencil. -
PLEASE DO NOT USE FINE POINT PENS. /X/
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE EACH
PROPOSAL, AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. BALANCED FUND ONLY: TO APPROVE A NEW SUB-ADVISORY
AGREEMENT WITH NORDEA SECURITIES, INC. / / / / / /
3. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNED
SESSION OF THE MEETING. / / / / / /
SRVIT-VIC
194
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
Please fold and detach card at perforation before mailing
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE FUND LISTED
ABOVE, TO BE HELD AT 2:00 P.M. ON WEDNESDAY, SEPTEMBER 26, 2001, AT ONE
FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY ADJOURNMENTS THEREOF.
DATE____________________
________________________________________
| |
| |
| |
|______________________________________|
Signature(s) of joint participant
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN. PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LVIT-A
195
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING -
- PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK
OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT. / / / / / /
</Table>
<Table>
4. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palcimbo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
- - 5. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE -
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-A
196
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
STEINROE VARIABLE INVESTMENT TRUST PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST AND
STEINROE VARIABLE INVESTMENT TRUST.
Please fold and detach card at perforation before mailing
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company") hereby instructs the Insurance Company to cause the
shares of each above-referenced fund (the "Fund") allocable to Participant's
contract or policy to be voted in the manner specified on the reverse side with
respect to the matter described in the accompanying proxy statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY, SUB-ADVISORY AND PORTFOLIO MANAGEMENT AGREEMENTS.
DATE ______________________________________________
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING
INSTRUCTIONS CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
___________________________________________________
Signature(s) of joint participant
Please date and sign the name or names as printed
hereon. Where there are joint participants, all
joint Participants should sign. Corporate
Instructions should be signed by an authorized
officer, Executors, administrators, trustees, etc.
should so indicate when signing.
LVIT-VIC-A
197
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE
EACH PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO
USE THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE
SPECIAL MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING,
PLEASE COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
\/ Please fold and detach card at perforation before mailing \/
\/ Please fill in box(es) as shown using black or blue ink or number 2 pencil.\/
PLEASE DO NOT USE FINE POINT PENS. [X]
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ]
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ]
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT. [ ] [ ] [ ]
4. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
(01) Douglas A. Hacker, NOMINEES FROM ALL NOMINEES
(02) Janet Langford Kelly, (03) Richard W. Lowry, NOMINEES EXCEPT AS
(04) Salvatore Macora, (05) William E. Mayer, NOTED
(06) Charles R. Nelson, (07) John J. Neuhauser, [ ] [ ] [ ]
(08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S)
ON THE LINE BELOW.
_____________________________________________________
\/ 5. TO CONSIDER AND ACT UPON ANY OTHER MATTER THAT \/
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNED
SESSION OF THE MEETING. LVIT-VIC-A
198
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE FUND LISTED
ABOVE TO BE HELD AT 2:00 P.M. ON WEDNESDAY, SEPTEMBER 26, 2001, AT ONE FINANCIAL
CENTER, BOSTON, MASSACHUSETTS, AND AT ANY ADJOURNMENTS THEREOF.
DATE_________________
[ ]
SIGNATURE(S) OF JOINT OWNERS
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN, PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LVIT-B
199
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL, AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING -
- - PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL.
PLEASE DO NOT USE FINE POINT PENS. /X/
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
</Table>
<Table>
3. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
- - 4. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE -
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-B
200
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
STEINROE VARIABLE INVESTMENT TRUST PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST AND
STEINROE VARIABLE INVESTMENT TRUST.
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company"), hereby instructs the Insurance Company to cause the
shares of each above-referenced fund (the "Fund") allocable to Participant's
contract or policy to be voted in the manner specified on the reverse side with
respect to the matter described in the accompanying proxy statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY AND SUB-ADVISORY AGREEMENTS.
DATE __________________________
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING INSTRUCTIONS
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
__________________________________________________________
Signature(s) of joint participant
Please date and sign the name or names as printed hereon.
Where there are Joint Participants, all Joint Participants
should sign. Corporate Instructions should be signed by an
authorized officer. Executors, administrators, trustees,
etc., should so indicate when signing.
LVIT-VIC-B
201
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING
\/ PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER
2 PENCIL. PLEASE DO NOT USE FINE POINT PENS. /X/
<Table>
<Caption> FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
3. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
4. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
\/ \/
LVIT-VIC-B
202
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
STEINROE VARIABLE INVESTMENT TRUST PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST AND
STEINROE VARIABLE INVESTMENT TRUST.
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company"), hereby instructs the Insurance Company to cause the
shares of each above-referenced fund (the "Fund") allocable to Participant's
contract or policy to be voted in the manner specified on the reverse side with
respect to the matter described in the accompanying proxy statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY, SUB-ADVISORY AND PORTFOLIO MANAGEMENT AGREEMENTS.
DATE___________________________________
PLEASE MARK, SIGN, DATE AND RETURN THE
VOTING INSTRUCTIONS CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
_______________________________________
Signature(s) of joint participant
Please date and sign the name or names
as printed hereon. Where there are Joint
Participants, all Joint Participants
should sign. Corporate Instructions
should be signed by an authorized
officer. Executors, administrators,
trustees, etc. should so indicate when
signing.
\/ \/
LVIT-ABEF-VIC
203
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE
EACH PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO
USE THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE
SPECIAL MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING,
PLEASE COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
\/ \/
Please fill in box(es) as shown using black or blue ink or number 2 pencil. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ] 1.
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ] 2.
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH MASTRAPASQUA & ASSOCIATES, INC. [ ] [ ] [ ] 3.
4. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH OPPENHEIMER CAPITAL. [ ] [ ] [ ] 4.
5. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH BOSTON PARTNERS ASSET MANAGEMENT, L.P. [ ] [ ] [ ] 5.
6. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH WESTWOOD MANAGEMENT CORPORATION. [ ] [ ] [ ] 6.
7. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH TCW INVESTMENT MANAGEMENT COMPANY. [ ] [ ] [ ] 7.
WITHHOLD FOR ALL
FOR ALL FROM ALL NOMINEES
NOMINEES NOMINEES EXCEPT AS
8. TO ELECT A BOARD OF TRUSTEES. NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry, [ ] [ ] [ ] 8.
(04) Salvatore Macera; (05) William E. Mayer, (06) Charles R. Nelson,
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas B. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
_____________________________________________________________________________
9. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNED SESSION OF THE MEETING
</Table>
\/ LVIT-ASEF-VIC \/
204
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
STEINROE VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE FUND LISTED
ABOVE, TO BE HELD AT 2:00 P.M. ON WEDNESDAY, SEPTEMBER 26, 2001, AT ONE
FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY ADJOURNMENTS THEREOF.
DATE_________________
[ ]
Signature(s) of joint participant
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN, PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LVIT-ASE
205
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
* PLEASE FOLD AND DETACH AT CARD PERFORATION BEFORE MAILING *
Please fill in box(es) as shown using black or blue ink or number 2 pencil. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ] 1.
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ] 2.
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH MASIRAPASQUA & [ ] [ ] [ ] 3.
ASSOCIATES, INC.
4. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH OPPENHEIMER CAPITAL. [ ] [ ] [ ] 4.
5. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH BOSTON PARTNERS ASSET [ ] [ ] [ ] 5.
MANAGEMENT, L.P.
6. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH WESTWOOD MANAGEMENT [ ] [ ] [ ] 6.
CORPORATION.
7. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH TCW INVESTMENT [ ] [ ] [ ] 7.
MANAGEMENT COMPANY.
</Table>
<Table>
<Caption>
FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
8. TO ELECT A BOARD OF TRUSTEES.
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayor, (06) Charles R. Nelson,
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW. [ ] [ ] [ ] 8.
________________________________________________________________________
9. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-ASEP
</Table>
206
STEINROE VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
STEINROE VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSEL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT P.
PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE STEINROE
VARIABLE SERIES FUND LISTED ABOVE TO BE HELD AT 2:00 P.M. ON WEDNESDAY,
SEPTEMBER 26, 2001, AT ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY
ADJOURNMENTS THEREOF.
DATE ______________
[ ]
SIGNATURE(S) (IF JOINT PARTICIPANT)
PLEASE SIGN YOUR NAME OR NAMES EXACTLY AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED ABOVE. WHERE SHARES ARE REGISTERED WITH JOINT
OWNERS, ALL JOINT OWNERS SHOULD SIGN. PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO INDICATE CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
SRVIT
207
* Please fold and detach card at perforation before mailing *
Please fill in box(es) as shown using black or blue ink or
number 2 pencil. PLEASE DO NOT USE FINE POINT PENS. [X]
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH PROPOSAL
AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE THEIR
DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL MEETING.
IF YOU DO NOT INTEND PERSONALLY TO ATTEND THIS SPECIAL MEETING, PLEASE COMPLETE
AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY
AGREEMENT. [ ] [ ] [ ]
2. BALANCED FUND ONLY: TO APPROVE A
NEW SUB-ADVISORY AGREEMENT WITH NORDEA
SECURITIES, INC. [ ] [ ] [ ]
3. TO CONSIDER AND ACT UPON ANY OTHER
MATTERS THAT PROPERLY COME BEFORE
THE MEETING AND ANY ADJOURNED SESSION
OF THE MEETING.
208
STEINROE VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
PARTICIPANTS FOR VOTING SHARES OF
STEINROE VARIABLE INVESTMENT TRUST.
** Please fold and detach card at perforation before mailing **
VOTING INSTRUCTIONS
STEINROE VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance
Company (the "Insurance Company"), hereby instructs the Insurance Company to
cause the shares of each of the above-referenced fund (the "Fund") allocable to
Participant's contract or policy to be voted in the manner specified on the
reverse side with respect to the matter described in the accompanying proxy
statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF EACH PROPOSAL.
** DATE ____________________________
PLEASE MARK, SIGN, DATE AND RETURN THE
VOTING INSTRUCTIONS CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
________________________________________
Signature(s) of joint participant
Please date and sign the name or names
as printed hereon. Where there are Joint
Participants, all Joint Participants
should sign. Corporate Instructions
should be signed by an authorized
officer. Executors, administrators,
trustees, etc. should so indicate when
signing.
** **
SRVIT-VIC
209
- Please fold and detach card at perforation before mailing -
- Please fill in box(es) as shown using black or blue ink or number 2 pencil. -
PLEASE DO NOT USE FINE POINT PENS. /X/
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE EACH
PROPOSAL, AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. BALANCED FUND ONLY: TO APPROVE A NEW SUB-ADVISORY
AGREEMENT WITH NORDEA SECURITIES, INC. / / / / / /
3. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNED
SESSION OF THE MEETING. / / / / / /
SRVIT-VIC
210
LIBERTY VARIABLE INVESTMENT TRUST
Please fold and detach card at perforation before mailing
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE LIBERTY
VARIABLE SERIES FUND LISTED ABOVE, TO BE HELD AT 2:00 P.M. ON WEDNESDAY,
SEPTEMBER 26, 2001, AT ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY
ADJOURNMENTS THEREOF.
DATE____________________
________________________________________
| |
| |
| |
|______________________________________|
Signature(s) of joint participant
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN. PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LVIT-A
211
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING -
- PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK
OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT. / / / / / /
</Table>
<Table>
4. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palcimbo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
- - 5. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE -
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-A
212
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST.
Please fold and detach card at perforation before mailing
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company") hereby instructs the Insurance Company to cause the
shares of each of the above-referenced fund (the "Fund") allocable to
Participant's contract or policy to be voted in the manner specified on the
reverse side with respect to the matter described in the accompanying proxy
statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY, SUB-ADVISORY AND PORTFOLIO MANAGEMENT AGREEMENTS.
DATE ______________________________________________
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING
INSTRUCTIONS CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
___________________________________________________
Signature(s) of joint participant
Please date and sign the name or names as printed
hereon. Where there are joint participants, all
joint Participants should sign. Corporate
Instructions should be signed by an authorized
officer, Executors, administrators, trustees, etc.
should so indicate when signing.
LVIT-VIC-A
213
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE
EACH PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO
USE THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE
SPECIAL MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING,
PLEASE COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
\/ Please fold and detach card at perforation before mailing \/
\/ Please fill in box(es) as shown using black or blue ink or number 2 pencil.\/
PLEASE DO NOT USE FINE POINT PENS. [X]
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ]
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ]
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT. [ ] [ ] [ ]
4. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
(01) Douglas A. Hacker, NOMINEES FROM ALL NOMINEES
(02) Janet Langford Kelly, (03) Richard W. Lowry, NOMINEES EXCEPT AS
(04) Salvatore Macora, (05) William E. Mayer, NOTED
(06) Charles R. Nelson, (07) John J. Neuhauser, [ ] [ ] [ ]
(08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S)
ON THE LINE BELOW.
_____________________________________________________
\/ 5. TO CONSIDER AND ACT UPON ANY OTHER MATTER THAT \/
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNED
SESSION OF THE MEETING. LVIT-VIC-A
214
LIBERTY VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE LIBERTY
VARIABLE SERIES FUND LISTED ABOVE TO BE HELD AT 2:00 P.M. ON WEDNESDAY,
SEPTEMBER 26, 2001, AT ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY
ADJOURNMENTS THEREOF.
DATE _________________
[ ]
SIGNATURE(S) OF JOINT OWNERS
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN, PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LVIT-B
215
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL, AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING -
- - PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL.
PLEASE DO NOT USE FINE POINT PENS. /X/
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
</Table>
<Table>
3. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
- - 4. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE -
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-B
216
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST.
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company"), hereby instructs the Insurance Company to cause the
shares of each of the above-referenced fund (the "Fund") allocable to
Participant's contract or policy to be voted in the manner specified on the
reverse side with respect to the matter described in the accompanying proxy
statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY AND SUB-ADVISORY AGREEMENTS.
DATE __________________________
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING INSTRUCTIONS
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
__________________________________________________________
Signature(s) of joint participant
Please date and sign the name or names as printed hereon.
Where there are Joint Participants, all Joint Participants
should sign. Corporate Instructions should be signed by an
authorized officer. Executors, administrators, trustees,
etc., should so indicate when signing.
LVIT-VIC-B
217
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
- PLEASE FOLD AND DETACH CARD AT PERFORATION BEFORE MAILING
\/ PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER
2 PENCIL. PLEASE DO NOT USE FINE POINT PENS. /X/
<Table>
<Caption> FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. / / / / / /
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. / / / / / /
3. TO ELECT A BOARD OF TRUSTEES. FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayer, (06) Charles R. Nelson, / / / / / /
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
</Table>
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
________________________________________________________________________
4. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE
THE MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
\/ \/
LVIT-VIC-B
218
LIBERTY VARIABLE INVESTMENT TRUST INSTRUCTIONS OF VARIABLE CONTRACT
PARTICIPANTS FOR VOTING SHARES OF
LIBERTY VARIABLE INVESTMENT TRUST.
VOTING INSTRUCTIONS
LIBERTY VARIABLE INVESTMENT TRUST
The undersigned, being a Participant under a variable annuity contract or
variable life insurance policy issued by the above-referenced Insurance Company
(the "Insurance Company"), hereby instructs the Insurance Company to cause the
shares of each of the above-referenced fund (the "Fund") allocable to
Participant's contract or policy to be voted in the manner specified on the
reverse side with respect to the matter described in the accompanying proxy
statement.
THE INSURANCE COMPANY WILL FOLLOW VOTING INSTRUCTIONS ONLY IF THEY ARE RECEIVED
AT LEAST ONE DAY PRIOR TO THE DATE OF THE MEETING. IF NO INSTRUCTIONS ARE
SPECIFIED, THE INSURANCE COMPANY WILL VOTE THE SHARES IN FAVOR OF THE NEW
ADVISORY, SUB-ADVISORY AND PORTFOLIO MANAGEMENT AGREEMENTS.
DATE___________________________________
PLEASE MARK, SIGN, DATE AND RETURN THE
VOTING INSTRUCTIONS CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
_______________________________________
Signature(s) of joint participant
Please date and sign the name or names
as printed hereon. Where there are Joint
Participants, all Joint Participants
should sign. Corporate Instructions
should be signed by an authorized
officer. Executors, administrators,
trustees, etc. should so indicate when
signing.
\/ \/
LVIT-ABEF-VIC
219
BY SIGNING AND DATING THIS CARD, YOU INSTRUCT THE INSURANCE COMPANY TO VOTE
EACH PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO
USE THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE
SPECIAL MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING,
PLEASE COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
\/ \/
Please fill in box(es) as shown using black or blue ink or number 2 pencil. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ] 1.
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ] 2.
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH MASTRAPASQUA & ASSOCIATES, INC. [ ] [ ] [ ] 3.
4. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH OPPENHEIMER CAPITAL. [ ] [ ] [ ] 4.
5. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH BOSTON PARTNERS ASSET MANAGEMENT, L.P. [ ] [ ] [ ] 5.
6. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH WESTWOOD MANAGEMENT CORPORATION. [ ] [ ] [ ] 6.
7. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH TCW INVESTMENT MANAGEMENT COMPANY. [ ] [ ] [ ] 7.
WITHHOLD FOR ALL
FOR ALL FROM ALL NOMINEES
NOMINEES NOMINEES EXCEPT AS
8. TO ELECT A BOARD OF TRUSTEES. NOTED
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry, [ ] [ ] [ ] 8.
(04) Salvatore Macera; (05) William E. Mayer, (06) Charles R. Nelson,
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas B. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW.
_____________________________________________________________________________
9. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNED SESSION OF THE MEETING
</Table>
\/ LVIT-ASEF-VIC \/
220
LIBERTY VARIABLE INVESTMENT TRUST
* Please fold and detach card at perforation before mailing *
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR A MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 26, 2001
LIBERTY VARIABLE INVESTMENT TRUST
THE UNDERSIGNED HEREBY APPOINTS WILLIAM J. BALLOU, KEVIN M. CAROME, ELLEN
HARRINGTON, RUSSELL L. KANE, ROBERT R. LEVEILLE, JOSEPH R. PALOMBO AND VINCENT
P. PIETROPAOLO, AND EACH OF THEM, PROXIES OF THE UNDERSIGNED, WITH POWER OF
SUBSTITUTION, TO VOTE AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE LIBERTY
VARIABLE SERIES FUND LISTED ABOVE, TO BE HELD AT 2:00 P.M. ON WEDNESDAY,
SEPTEMBER 26, 2001, AT ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS, AND AT ANY
ADJOURNMENTS THEREOF.
DATE _________________
[ ]
Signature(s) of joint participant
PLEASE SIGN YOUR NAME OR NAMES EXACTLY
AS PRINTED TO THE LEFT TO AUTHORIZE THE
VOTING OF YOUR SHARES AS INDICATED
ABOVE. WHERE SHARES ARE REGISTERED WITH
JOINT OWNERS, ALL JOINT OWNERS SHOULD
SIGN. PERSONS SIGNING AS EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD SO
INDICATE. CORPORATE PROXIES SHOULD BE
SIGNED BY AN AUTHORIZED OFFICER.
LIBERTY VARIABLE INVESTMENT TRUST LVIT-ASE
221
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE EACH
PROPOSAL AS MARKED, OR, IF NOT MARKED, TO VOTE "FOR" EACH PROPOSAL AND TO USE
THEIR DISCRETION TO VOTE ON ANY OTHER MATTER THAT MAY COME BEFORE THE SPECIAL
MEETING. IF YOU DO NOT INTEND PERSONALLY TO ATTEND THE SPECIAL MEETING, PLEASE
COMPLETE AND MAIL THIS CARD AT ONCE IN THE ENCLOSED ENVELOPE.
* PLEASE FOLD AND DETACH AT CARD PERFORATION BEFORE MAILING *
Please fill in box(es) as shown using black or blue ink or number 2 pencil. [X]
PLEASE DO NOT USE FINE POINT PENS.
<Table>
<Caption>
FOR AGAINST ABSTAIN
1. TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT. [ ] [ ] [ ] 1.
2. TO APPROVE A NEW SUB-ADVISORY AGREEMENT. [ ] [ ] [ ] 2.
3. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH MASIRAPASQUA & [ ] [ ] [ ] 3.
ASSOCIATES, INC.
4. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH OPPENHEIMER CAPITAL. [ ] [ ] [ ] 4.
5. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH BOSTON PARTNERS ASSET [ ] [ ] [ ] 5.
MANAGEMENT, L.P.
6. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH WESTWOOD MANAGEMENT [ ] [ ] [ ] 6.
CORPORATION.
7. TO APPROVE A NEW PORTFOLIO MANAGEMENT AGREEMENT WITH TCW INVESTMENT [ ] [ ] [ ] 7.
MANAGEMENT COMPANY.
</Table>
<Table>
<Caption>
FOR ALL WITHHOLD FOR ALL
NOMINEES FROM ALL NOMINEES
NOMINEES EXCEPT AS
NOTED
8. TO ELECT A BOARD OF TRUSTEES.
(01) Douglas A. Hacker, (02) Janet Langford Kelly, (03) Richard W. Lowry,
(04) Salvatore Macera, (05) William E. Mayor, (06) Charles R. Nelson,
(07) John J. Neuhauser, (08) Joseph R. Palombo, (09) Thomas E. Stitzel,
(10) Thomas C. Theobald, (11) Anne-Lee Verville
TO WITHHOLD AUTHORITY TO VOTE, PLEASE WRITE NUMBER(S) ON THE LINE BELOW. [ ] [ ] [ ] 8.
________________________________________________________________________
9. TO CONSIDER AND ACT UPON ANY OTHER MATTERS THAT PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNED SESSION OF THE MEETING.
LVIT-ASEP
</Table>