SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for use of the Commission Only (as permitted by
Rule 14a-6(e) (2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Columbia Funds Trust I; Columbia Funds Trust III; Columbia Funds Trust IV;
Columbia Funds Trust V; Columbia Funds Trust VI; Columbia Funds Trust VII;
Columbia Funds Trust VIII, Columbia Funds Trust IX and Columbia Funds Trust XI
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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/ / 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.
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THE COLUMBIA FUNDS
(THE "FUNDS")
ONE FINANCIAL CENTER,
BOSTON, MASSACHUSETTS 02111-2621
1-866-348-1468
JULY 22, 2005
Dear Shareholder:
I am writing to you to ask for your vote on the following important matters that
affect your investment in the Funds: (1) the election of Trustees for your Fund;
and (2) the approval of amendments to and the elimination of certain fundamental
investment restrictions of your Fund. If approved, these amendments to and
eliminations of certain fundamental investment restrictions will serve to
facilitate efficient administration of and compliance monitoring for your Fund.
Shareholders of Funds that are voting on certain merger transactions have
received or will receive shortly separate proxy statements in connection with
the merger transactions. This proxy statement is not a duplicate of the merger
proxy statement. It is for a separate shareholder meeting called for the
election of Trustees.
It is expected that if shareholders of a Fund approve the election of all
nominees to its Board of Trustees, the Fund will be reorganized as a series of
Columbia Funds Trust IX, a Massachusetts business trust into which the legal
entities of all of the retail Columbia Funds are expected to be consolidated.
Columbia believes that this consolidation will also enhance the efficiency of
administration and compliance monitoring for the Columbia Funds. In addition, in
connection with this consolidation, the Trustees have approved the amendment of
the Declaration of Trust of Columbia Funds Trust IX, which is expected to be
effective on August 10, 2005. A comparison of the amended Declaration of Trust
to the existing Declaration of Trust for each Fund, including Columbia High
Yield Municipal Fund and Columbia Managed Municipals Fund, which are already
series of Columbia Funds Trust IX, appears under the heading "Information About
the Acquiring Trust" in this Proxy Statement. Please read it carefully.
Included in this booklet is information about the upcoming meeting of
shareholders of the Funds (the "Special Meeting"):
- A NOTICE OF SPECIAL MEETING OF SHAREHOLDERS OF EACH OF THE FUNDS, which
summarizes the issues on which you are being asked to vote; and
- A PROXY STATEMENT FOR THE SPECIAL MEETING, which provides more detailed
information on the specific issues being considered at the Special
Meeting.
ALSO ENCLOSED ARE YOUR BALLOT AND POSTAGE-PAID RETURN ENVELOPE.
Although we would like very much to have each shareholder attend this meeting,
we realize that it may not be possible. Whether or not you plan to be present,
we need your vote. We urge you to record your voting instructions by telephone,
via the Internet or by completing, signing and returning the enclosed proxy
card(s) promptly. A postage-paid envelope is enclosed for mailing, and Internet
voting instructions are listed at the top of your proxy card(s).
Your vote is important. A prompt response on your part will help to ensure that
your interests are represented. If you have any questions about the proposals,
please call a Columbia customer service representative at (866)348-1468 or
contact your financial advisor.
Sincerely yours,
Christopher L. Wilson
President
COLUMBIA FUNDS TRUST I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Columbia Tax-Managed Value Fund
COLUMBIA FUNDS TRUST III
Columbia Federal Securities Fund
Columbia Global Equity Fund
Columbia Intermediate Government Income Fund
Columbia Liberty Fund
Columbia Mid Cap Value Fund
Columbia Quality Plus Bond Fund
COLUMBIA FUNDS TRUST IV
Columbia Municipal Money Market Fund
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
COLUMBIA FUNDS TRUST V
Columbia California Tax-Exempt Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Florida Intermediate Municipal Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Company Index Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia New York Tax-Exempt Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Columbia Small Company Index Fund
Columbia U.S. Treasury Index Fund
COLUMBIA FUNDS TRUST VI
Columbia Growth & Income Fund
Columbia Small Cap Value Fund
COLUMBIA FUNDS TRUST VII
Columbia Newport Tiger Fund
COLUMBIA FUNDS TRUST VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
COLUMBIA FUNDS TRUST IX
Columbia High Yield Municipal Fund
Columbia Managed Municipals Fund
COLUMBIA FUNDS TRUST XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Disciplined Value Fund
Columbia Growth Stock Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Small Company Equity Fund
Columbia Small Cap Fund
Columbia Young Investor Fund
(EACH, A "FUND"; AND COLLECTIVELY, THE "FUNDS")
ONE FINANCIAL CENTER,
BOSTON, MASSACHUSETTS 02111-2621
1-866-348-1468
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 16, 2005
To the Shareholders of the Funds.
NOTICE IS HEREBY GIVEN that the Special Meeting of Shareholders of the Funds
(the "Meeting") will be held at the offices of the Funds at One Financial
Center, Boston, Massachusetts, on September 16, 2005, at 10:00 a.m. Boston time.
The purpose of the Meeting is to consider and act upon the following matters:
1. To elect your Fund's nominees for Trustees. (To be voted on separately by all
shareholders of each trust, voting together with shareholders of all funds of
that trust.)
2. To approve amendments to and the elimination of certain fundamental
investment restrictions of your Fund. (To be voted upon by the shareholders
of each affected fund, voting separately by fund and separately on each
proposed amendment or elimination.)
3. To transact such other business as may properly come before the Meeting, or
any adjournment(s) thereof.
The Board of Trustees has fixed the close of business on June 28, 2005, as the
record date for the determination of the shareholders of the Funds entitled to
notice of, and to vote at, the Meeting and any adjournments thereof.
THE BOARD OF TRUSTEES RECOMMENDS THAT YOU VOTE FOR ALL OF THE PROPOSALS.
By order of the Board of Trustees,
R. Scott Henderson
Secretary of the Funds
July 22, 2005
NOTICE: YOUR VOTE IS IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
PLEASE SEE THE ENCLOSED PROXY STATEMENT AND OTHER MATERIALS FOR INSTRUCTIONS ON
HOW TO VOTE EASILY AND QUICKLY.
COLUMBIA FUNDS TRUST I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Columbia Tax-Managed Value Fund*
COLUMBIA FUNDS TRUST III
Columbia Federal Securities Fund
Columbia Global Equity Fund
Columbia Intermediate Government Income Fund*
Columbia Liberty Fund
Columbia Mid Cap Value Fund*
Columbia Quality Plus Bond Fund
COLUMBIA FUNDS TRUST IV
Columbia Municipal Money Market Fund*
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
COLUMBIA FUNDS TRUST V
Columbia California Tax-Exempt Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Florida Intermediate Municipal Bond Fund*
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Company Index Fund*
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia New York Tax-Exempt Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Columbia Small Company Index Fund*
Columbia U.S. Treasury Index Fund
COLUMBIA FUNDS TRUST VI
Columbia Growth & Income Fund*
Columbia Small Cap Value Fund
COLUMBIA FUNDS TRUST VII
Columbia Newport Tiger Fund*
COLUMBIA FUNDS TRUST VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
COLUMBIA FUNDS TRUST IX
Columbia High Yield Municipal Fund
Columbia Managed Municipals Fund*
1
COLUMBIA FUNDS TRUST XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Disciplined Value Fund
Columbia Growth Stock Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Small Company Equity Fund
Columbia Small Cap Fund
Columbia Young Investor Fund
(EACH ITALICIZED ENTITY, A "FUND"; TOGETHER WITH THE OTHER ITALICIZED ENTITIES,
THE "FUNDS"; EACH UNITALICIZED ENTITY, A "TRUST"; TOGETHER WITH THE OTHER
UNITALICIZED ENTITIES, THE "TRUSTS")
ONE FINANCIAL CENTER,
BOSTON, MASSACHUSETTS 02111-2621
1-866-348-1468
PROXY STATEMENT
FOR THE SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 16, 2005
This Proxy Statement is being furnished in connection with the solicitation of
proxies by the Board of Trustees (the "Board" or the "Trustees") of the Trusts
for use at the special meeting of the shareholders of the Funds (the "Meeting")
to be held at the offices of the Funds, One Financial Center, Boston,
Massachusetts, on September 16, 2005, at 10:00 a.m. Boston time, and at any
adjournment(s) thereof, for the purposes set forth in the accompanying Notice of
Special Meeting of Shareholders (the "Notice"). The Notice, this Proxy Statement
and the enclosed proxy card are first being mailed, or otherwise being made
available, to shareholders on or about July 25, 2005. Please read this Proxy
Statement and keep it for future reference.
The Meeting has been called for the purpose of having the shareholders of the
Funds consider and take action upon the proposals listed in the Notice (the
"Proposals"). This Proxy Statement contains information you should
- ------------------------------
* Each Fund with an asterisk, a "Merger Fund"; together with the other Funds
with an asterisk, the
"Merger Funds." Shareholders of each of the Merger Funds are voting on certain
merger
transactions, and have received or will receive shortly separate proxy
statements in connection
with the merger transactions. This proxy statement is not a duplicate of the
merger proxy
statement. It is for a separate shareholder meeting called for the election of
Trustees.
2
know before voting on the Proposals. As described in greater detail below, while
shareholders are being asked to amend and eliminate certain "fundamental"
investment restrictions, this is being done solely to facilitate compliance
testing through standardization and to enhance future flexibility. The Funds'
investment advisor, Columbia Management Advisors, Inc. ("Columbia Management")
has no present intention of changing the way that the Funds are managed in
response to these proposals. The following is a list of the Proposals presented
in this Proxy Statement and the Funds that are affected by such Proposals:
<Table>
<Caption>
PROPOSAL AFFECTED FUNDS
- -------- --------------
Proposal 1: To approve All Funds
the election of
Trustees.
Proposal 2.A.: To All Funds except the Merger Funds
approve an amendment
to certain Funds'
fundamental investment
restrictions with
respect to borrowing
money, pledging assets
and issuing senior
securities.
Proposal 2.B.: To All Funds except the Merger Funds
approve an amendment
to certain Funds'
fundamental investment
restrictions with
respect to making
loans.
</Table>
3
<Table>
<Caption>
PROPOSAL AFFECTED FUNDS
- -------- --------------
Proposal 2.C.: To Columbia Asset Allocation Fund
approve an amendment Columbia Disciplined Value Fund
to certain Funds' Columbia Dividend Income Fund
fundamental investment Columbia Federal Securities Fund
restrictions with Columbia Global Equity Fund
respect to Columbia Growth Stock Fund
diversification of Columbia High Yield Municipal Fund
investments. Columbia High Yield Opportunity Fund
Columbia Income Fund
Columbia Intermediate Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Liberty Fund
Columbia Quality Plus Bond Fund
Columbia Small Cap Fund
Columbia Small Cap Value Fund
Columbia Small Company Equity Fund
Columbia Strategic Income Fund
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Tax-Managed Growth Fund
Columbia U.S. Treasury Index Fund
Columbia Utilities Fund
Columbia Young Investor Fund
Proposal 2.D.: To Columbia Asset Allocation Fund
approve an amendment Columbia Connecticut Intermediate Municipal Bond
to certain Funds' Fund
fundamental investment Columbia Disciplined Value Fund
restrictions with Columbia Dividend Income Fund
respect to investments Columbia Growth Stock Fund
in commodities. Columbia High Yield Municipal Fund
Columbia Income Fund
Columbia Intermediate Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Massachusetts Intermediate Municipal Bond
Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Quality Plus Bond Fund
Columbia Rhode Island Intermediate Municipal Bond
Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
Columbia Tax-Managed Growth Fund
Columbia U.S. Treasury Index Fund
Columbia Young Investor Fund
</Table>
4
<Table>
<Caption>
PROPOSAL AFFECTED FUNDS
- -------- --------------
Proposal 2.E.: To All Funds except the Merger Funds
approve an amendment
to certain Funds'
fundamental investment
restrictions with
respect to investments
in real estate.
Proposal 2.F.: To All Funds except the Merger Funds
approve an amendment
to certain Funds'
fundamental investment
restrictions with
respect to
underwriting of
securities.
Proposal 2.G.: To Columbia California Tax-Exempt Fund
approve the Columbia Connecticut Tax-Exempt Fund
elimination of certain Columbia Federal Securities Fund
Fund's fundamental Columbia Global Equity Fund
investment Columbia Liberty Fund
restrictions with Columbia Massachusetts Tax-Exempt Fund
respect to purchasing Columbia New York Tax-Exempt Fund
securities on margin. Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia U.S. Treasury Index Fund
Columbia Utilities Fund
Proposal 2.H.: To Columbia Global Equity Fund
approve the Columbia Growth Stock Fund
elimination of certain Columbia Income Fund
Funds' fundamental Columbia Intermediate Bond Fund
investment Columbia U.S. Treasury Index Fund
restrictions with Columbia Young Investor Fund
respect to investing
for the purpose of
exercising control.
Proposal 2.I.: To Columbia U.S. Treasury Index Fund
approve the
elimination of certain
Funds' fundamental
investment
restrictions with
respect to short
sales.
</Table>
5
<Table>
<Caption>
PROPOSAL AFFECTED FUNDS
- -------- --------------
Proposal 2.J.: To All Funds except the Merger Funds, Columbia Global
approve an amendment Equity Fund and Columbia Utilities Fund
to certain Funds'
fundamental investment
restrictions with
respect to
concentrating
investments in an
industry.
Proposal 2.K.: To Columbia U.S. Treasury Index Fund
approve the
elimination of certain
Funds' fundamental
investment
restrictions with
respect to purchasing
illiquid securities.
Proposal 2.L.: To Columbia U.S. Treasury Index Fund
approve the
elimination of certain
Funds' fundamental
investment
restrictions with
respect to investing
in securities of other
investment companies.
Proposal 2.M.: To Columbia Small Cap Value Fund
approve the
elimination of certain
Funds' fundamental
investment
restrictions with
respect to buying and
selling puts and
calls.
</Table>
With respect to Proposal 1, the shareholders of each Fund in a Trust will vote
together with the shareholders of all other Funds of that Trust on the election
of Trustees. With respect to Proposal 2, the shareholders of each Fund will vote
separately by Fund and separately on each Proposal 2.A. through 2.M. affecting
the Fund.
Timely, properly executed proxies will be voted as you instruct. If no
specification is made with respect to a Proposal, shares will be voted in
accordance with the recommendation of the Board as to that Proposal. The
solicitation is being made primarily by the mailing of this Proxy Statement and
the accompanying proxy card. Supplemental solicitations of proxies may be made
by personal interview, mail, telephone, facsimile or electronic
6
mail ("e-mail") by officers and Trustees of your Fund, officers and employees of
Columbia Management and other representatives of your Fund, as described below.
Columbia Management will bear the costs incurred in connection with the
solicitation of proxies, the costs of holding the Meeting, and other expenses
associated with obtaining the approval of the Funds and their shareholders.
Shareholders of record at the close of business on June 28, 2005 (the "Record
Date") are entitled to receive notice of, and to vote at, the Meeting or any
adjournment(s) thereof. Shareholders of a Fund that is a series of Columbia
Funds Trust I, Columbia Funds Trust III, Columbia Funds Trust IV, Columbia Funds
Trust V, Columbia Funds Trust VI or Columbia Trust VII on the Record Date shall
be entitled to one vote for each whole share held, as to any matter on which
they are entitled to vote, and each fractional share shall be entitled to a
proportionate fractional vote. Shareholders of a Fund that is a series of
Columbia Funds Trust VIII, Columbia Funds Trust IX and Columbia Funds Trust XI
on the Record Date shall be entitled to a number of votes on any matter on which
they are entitled to vote equal to the net asset value of the share (or
fractional share) in United States dollars determined at the close of business
on the Record Date (for example, a share having a net asset value of $10.50
would be entitled to 10.5 votes).
I. PROPOSAL 1: ELECTION OF TRUSTEES
Mses. Kelly and Verville and Messrs. Hacker, Lowry, Mayer, Nelson, Neuhauser,
Simpson, Stitzel, Theobald and Woolworth (who have each agreed to serve) are
proposed for election as Trustees of the Fund.
REQUIRED VOTE
The affirmative vote of a plurality of the holders of shares of beneficial
interest of each series of a Trust (voting together as a single class) present
at the Meeting in person or by proxy is required for the election of each such
Trustee. The names and ages of the Trustees of the Funds, the year each was
first elected, their principal business occupations during at least the last
five years, the number of portfolios in the other registered investment
companies advised by Columbia Management (the "Fund Complex") overseen by each
Trustee and other directorships that each Trustee holds are shown below. The
address of each Trustee is One Financial Center, Boston, MA 02111-2621.
7
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
FUND
YEAR FIRST ELECTED COMPLEX
POSITION OR APPOINTED TO PRINCIPAL OCCUPATION(S) OVERSEEN
NAME/AGE AND ADDRESS WITH FUNDS OFFICE(1) DURING PAST FIVE YEARS BY DIRECTOR
- ------------------------ ---------- ------------------ --------------------------------- -------------
Douglas A. Hacker Director/ 1996 Executive Vice President - 101
(Age 49) Trustee Strategy of United Airlines
(airline) since December, 2002
(formerly President of UAL
Loyalty Services (airline) from
September, 2001 to December,
2002; Executive Vice President
and Chief Financial Officer of
United Airlines from July, 1999
to September, 2001; Senior Vice
President - Finance from March,
1993 to July, 1999).
Janet Langford Kelly Director/ 1996 Partner, Zelle, Hofmann, Voelbel, 101
(Age 47) Trustee Mason & Gette LLP (Law firm)
since 2005; Adjunct Professor of
Law, Northwestern University,
since September, 2004; (formerly
Chief Administration Officer and
Senior Vice President, Kmart
Holding Corporation (consumer
goods), from September, 2003 to
March, 2004; Executive Vice
President - Corporate Development
and Administration, General
Counsel and Secretary, Kellogg
Company (food manufacturer), from
September, 1999 to August, 2003;
Senior Vice President, Secretary
and General Counsel, Sara Lee
Corporation (branded, packaged,
consumer - products manufacturer)
from January, 1995 to September,
1999).
<Caption>
NAME/AGE AND ADDRESS OTHER DIRECTORSHIPS HELD
- ------------------------ -------------------------------
Douglas A. Hacker None
(Age 49)
Janet Langford Kelly None
(Age 47)
</Table>
8
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
FUND
YEAR FIRST ELECTED COMPLEX
POSITION OR APPOINTED TO PRINCIPAL OCCUPATION(S) OVERSEEN
NAME/AGE AND ADDRESS WITH FUNDS OFFICE(1) DURING PAST FIVE YEARS BY DIRECTOR
- ------------------------ ---------- ------------------ --------------------------------- -------------
Richard W. Lowry(2) Director/ 1995 Private Investor since August, 103
(Age 69) Trustee 1987 (formerly Chairman and Chief
Executive Officer, U.S. Plywood
Corporation (building products
manufacturer)).
Charles R. Nelson Director/ 1981 Professor of Economics, 101
(Age 62) Trustee University of Washington, since
January, 1976; Ford and Louisa
Van Voorhis Professor of
Political Economy, University of
Washington, since September,
1993; (formerly Director,
Institute for Economic Research,
University of Washington, from
September, 2001 to June, 2003;
Adjunct Professor of Statistics,
University of Washington, since
September, 1980; Associate
Editor, Journal of Money Credit
and Banking, since September,
1993; consultant on econometric
and statistical matters).
John J. Neuhauser(2) Director/ 1985 Academic Vice President and Dean 103
(Age 62) Trustee of Faculties since August, 1999,
Boston College (formerly Dean,
Boston College School of
Management from September, 1977
to August, 1999).
Patrick J. Simpson Director/ 2000 Partner, Perkins Coie, LLP (law 101
(Age 61) Trustee firm).
<Caption>
NAME/AGE AND ADDRESS OTHER DIRECTORSHIPS HELD
- ------------------------ -------------------------------
Richard W. Lowry(2) None
(Age 69)
Charles R. Nelson None
(Age 62)
John J. Neuhauser(2) Saucony, Inc. (athletic
(Age 62) footwear)
Patrick J. Simpson None
(Age 61)
</Table>
9
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
FUND
YEAR FIRST ELECTED COMPLEX
POSITION OR APPOINTED TO PRINCIPAL OCCUPATION(S) OVERSEEN
NAME/AGE AND ADDRESS WITH FUNDS OFFICE(1) DURING PAST FIVE YEARS BY DIRECTOR
- ------------------------ ---------- ------------------ --------------------------------- -------------
Thomas E. Stitzel Director/ 1998 Business Consultant since 1999 101
(Age 69) Trustee (formerly Professor of Finance
from 1975 to 1999; College of
Business, Boise State
University); Chartered Financial
Analyst.
Thomas C. Theobald(3) Director/ 1996 Partner and Senior Advisor, 101
(Age 68) Trustee Chicago Growth Partners (private
equity investing) since
September, 2004; (formerly
Managing Director, William Blair
Capital Partners (private equity
investing) from September, 1994
to September, 2004).
Anne-Lee Verville Director/ 1998 Retired since 1997 (formerly 101
(Age 59) Trustee General Manager, Global Education
Industry, IBM Corporation
(computers and technology) from
1994 to 1997).
Richard L. Woolworth Director/ 1991 Retired since December, 2003 101
(Age 64) Trustee (formerly Chairman and Chief
Executive Officer, The Regence
Group (regional health insurer);
Chairman and Chief Executive
Officer, Blue Cross Blue Shield
of Oregon; Certified Public
Accountant, Arthur Young &
Company).
<Caption>
NAME/AGE AND ADDRESS OTHER DIRECTORSHIPS HELD
- ------------------------ -------------------------------
Thomas E. Stitzel None
(Age 69)
Thomas C. Theobald(3) Anixter International (network
(Age 68) support equipment distributor);
Ventas Inc. (real estate
investment trust); Jones Lang
LaSalle (real estate management
services) and Ambac Financial
Group (financial guarantee
insurance).
Anne-Lee Verville Chairman of the Board of
(Age 59) Directors, Enesco Group, Inc.
(designer, importer and
distributor of giftware and
collectibles).
Richard L. Woolworth NorthWest Natural (a natural
(Age 64) gas service provider).
</Table>
10
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
FUND
YEAR FIRST ELECTED COMPLEX
POSITION OR APPOINTED TO PRINCIPAL OCCUPATION(S) OVERSEEN
NAME/AGE AND ADDRESS WITH FUNDS OFFICE(1) DURING PAST FIVE YEARS BY DIRECTOR
- ------------------------ ---------- ------------------ --------------------------------- -------------
INTERESTED TRUSTEE
William E. Mayer(2)(4) Director/ 1994 Partner, Park Avenue Equity 103
(Age 65) Trustee Partners (private equity) since
February, 1999; (formerly
Partner, Development Capital LLC
from November, 1996 to February,
1999).
<Caption>
NAME/AGE AND ADDRESS OTHER DIRECTORSHIPS HELD
- ------------------------ -------------------------------
INTERESTED TRUSTEE
William E. Mayer(2)(4) Lee Enterprises (print media);
(Age 65) WR Hambrecht + Co. (financial
service provider); First Health
(healthcare); Readers Digest
(publisher); OPENFIELD
Solutions (retail industry
technology provider).
</Table>
(1) In October 2003, the trustees of the Liberty Funds and Stein Roe Funds were
elected to the boards of the Columbia Funds; simultaneous with that
election, Patrick J. Simpson and Richard L. Woolworth, who had been
directors/trustees of the Columbia Funds were appointed to serve as trustees
of the Liberty Funds and Stein Roe Funds. The date shown is the earliest
date on which a trustee/director was elected or appointed to the board of a
Fund in the Fund Complex.
(2) Messrs. Lowry, Neuhauser and Mayer each also serve as a director/trustee of
the All-Star Funds, currently consisting of 2 investment companies, which
are advised by an affiliate of Columbia Management.
(3) Mr. Theobald was appointed as Chairman of the Board effective December 10,
2003.
(4) Mr. Mayer is an "interested person" (as defined in the Investment Company
Act of 1940, as amended) of the Funds by reason of his affiliation with WR
Hambrecht + Co.
11
FOR INFORMATION REGARDING THE EXECUTIVE OFFICERS OF YOUR FUND, SEE APPENDIX A TO
THIS PROXY STATEMENT.
CONSOLIDATION OF LEGAL ENTITIES
The Trustees have also approved, subject to shareholder approval of the election
of all current Trustees, the reorganization of each Fund as a series (a "New
Fund") of a single Massachusetts business trust, Columbia Funds Trust IX (the
"Acquiring Trust"). The Trustees believe that the consolidation of the Funds
into a single legal entity will enhance the efficiency of compliance monitoring
and administration. This consolidation is currently expected to be effected in
the first quarter of 2006 (or in the case of each Fund that is a surviving fund
in a merger transaction, on the date of the closing of such merger transaction).
The New Fund will have the same fundamental investment restrictions as the
corresponding Fund immediately prior to the Reorganization (which will reflect
any approvals of Proposals 2.A. through 2.M.). All of the Trustees of the
Acquiring Trust are expected to serve as Trustees of the New Funds, even if one
or more of such Trustees are not elected pursuant to Proposal 1.
The consolidation of legal entities (the "Reorganizations") would be effected
pursuant to a plan of reorganization (a "Plan") that provides for the transfer
of all of the assets of each Fund to a New Fund in exchange for shares of the
New Fund and the assumption by the New Fund of all of the liabilities of the
Fund, followed by the liquidation of the Fund.
As described in more detail below in "Information About the Acquiring Trust",
the Acquiring Trust, like each Trust, is a business trust governed by
Massachusetts law and an agreement and declaration of trust (the "Agreement and
Declaration of Trust"). The Acquiring Trust has separate series representing
different portfolios. Each series of the Acquiring Trust will have shares
representing beneficial interests in the assets and liabilities belonging to
that series, and shares of each series will be further divided into separate
classes. The New Funds will continue the business of the Funds.
Each New Fund will have the same investment objectives, policies and
restrictions as the corresponding Fund (as amended by Proposal 2 to the extent
the amendments are approved by shareholders). In addition, each New Fund will be
managed by the same investment team as the corresponding Fund using the same
investment process, and will have the same management fees and expense structure
as the corresponding Fund immediately prior to the Reorganization.
12
Because each Reorganization would satisfy the provisions of Rule 17a-8 of the
Investment Company Act of 1940, as amended (the "1940 Act") that permit
reorganizations without a shareholder vote and none of the Agreements and
Declarations of Trust of the Funds requires a shareholder vote for such
Reorganizations, no shareholder vote is required to complete the
Reorganizations.
BACKGROUND AND REASONS FOR THE REORGANIZATIONS
At a meeting held on May 11, 2005, the Board, including all Trustees who are not
"interested persons" of the Funds (as defined in Section 2(a)(19) of the 1940
Act) (each, an "Independent Trustee") unanimously approved the Reorganization of
each Fund. The Board was assisted in its determination by independent legal
counsel for the Independent Trustees. The Board determined that each
Reorganization would be in the best interests of the relevant Fund, and that the
interests of the Fund's shareholders would not be diluted as a result of
effecting the Reorganization.
The Board also took into account the fact that the expected costs of the
proposed Reorganizations, including the costs incurred in connection with the
solicitation of proxies, the costs of holding the Meeting, the fees associated
with creating the New Funds, accounting fees, and legal fees, would be borne by
Columbia Management and not the Trusts or the Funds.
The primary purpose of the Reorganizations is to facilitate compliance
monitoring efficient administration.
AGREEMENT AND PLAN OF REORGANIZATION
Each Plan provides that the relevant New Fund will acquire all of the assets of
the corresponding Fund in exchange for the assumption by the New Fund of all of
the liabilities of the Fund and for the issuance of the shares of the New Fund
("Reorganization Shares"), all as of the Valuation Date, currently expected to
be October 7, 2005, for Columbia Tax-Managed Growth Fund; September 23, 2005,
for Columbia Federal Securities Fund, Columbia Strategic Income Fund and
Columbia Intermediate Tax-Exempt Bond Fund; September 16, 2005, for Columbia
Tax-Exempt Fund and Columbia California Tax-Exempt Fund; and a date in the first
quarter of 2006 for all other Funds. The following discussion of the Plans is
qualified in its entirety by the full text of the Plan for each Fund, the form
of which is attached as Exhibit 11 to this Proxy Statement.
Each Fund will sell all of its assets attributable to each class of its shares
to the corresponding New Fund, and, in exchange, the New Fund will assume
13
all of the liabilities of the Fund and deliver to the Fund a number of full and
fractional shares of beneficial interest of the same class of the New Fund
having an aggregate net asset value equal to the value of the assets of the
Fund, less the value of the liabilities of the Fund assumed by the New Fund
attributable to such class.
For federal income tax purposes, all of the Reorganizations are expected to be
tax-free reorganizations. For more information about the tax consequences of the
proposed Reorganizations, see "Federal Income Tax Consequences of the
Reorganizations" below.
Upon consummation of the transactions proposed to occur on the Exchange Date,
each Fund will distribute pro rata to its shareholders of record of each class
as of the Exchange Date the full and fractional Reorganization Shares of such
class received by the Fund. Each holder of shares of the Fund will receive a
number of full and/or fractional Reorganization Shares having an aggregate net
asset value on the Exchange Date equal to the value of and of the same class as
the full and/or fractional shares of the Fund held by the shareholder as of the
Exchange Date. This distribution will be accomplished by the establishment of
accounts on the share records of the corresponding New Fund in the names of the
Fund shareholders, each account representing the respective number of full and
fractional Reorganization Shares due such shareholder.
The consummation of each Reorganization is subject to the conditions set forth
in the Plan, including receipt of opinions of counsel, any of which may be
waived. Each Plan may be terminated and the Reorganization abandoned at any
time, before or after approval by the shareholders of the relevant Fund, prior
to the Exchange Date, by mutual consent of the Trustees of the relevant Fund and
trustees of the New Fund or, if any condition set forth in the Plan has not been
fulfilled and has not been waived by the party entitled to its benefits, by such
party.
All fees and expenses, including legal and accounting expenses, portfolio
transfer taxes (if any) or other similar expenses incurred in connection with
the consummation by each New Fund and its corresponding Fund of the transactions
contemplated by the Plan will be borne by Columbia Management.
OTHER MATTERS
The investment objectives, policies and restrictions of each Fund (as amended by
Proposal 2 to the extent the amendments are approved by shareholders) will be
adopted by each New Fund and will not change as a result of the Reorganizations.
In addition, Columbia Management will serve
14
as the investment adviser of each New Fund. Furthermore, the management fees and
expense structures of each New Fund will be the same as for the corresponding
Fund.
Immediately prior to the Reorganizations, the New Funds will have nominal assets
and no liabilities, and Columbia Management will be the sole shareholder of each
New Fund.
INFORMATION ABOUT THE ACQUIRING TRUST. On May 11, 2005, the Trustees of the
Acquiring Trust approved the amendment and restatement of the Acquiring Trust's
Agreement and Declaration of Trust (as amended and restated, the "Declaration of
Trust")and By-Laws (as amended and restated, the "By-Laws"), which are expected
to be effective on August 10, 2005.
The table below summarizes the significant differences between the Declaration
of Trust and By-Laws of the Acquiring Trust (as are expected to be effective on
August 10, 2005) and the organizational documents for the Funds. Prior to the
amendment and restatement of the Declaration of Trust and By-laws of the
Acquiring Trust approved by the Trustees of the Acquiring Trust on May 11, 2005,
the Agreement and Declaration of Trust of the Acquiring Trust were identical to
those of Columbia Funds Trust VIII and Columbia Funds Trust XI. For additional
information, shareholders of a Fund should refer directly to such documents,
copies of which may be obtained by contacting the Acquiring Trust at its address
listed on the cover page of this Proxy Statement.
15
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
SHAREHOLDER LIABILITY: A shareholder or former A shareholder or former
shareholder held to be personally shareholder held to be personally
liable solely by reason of his or liable solely by reason of his or
her being or having been a her being or having been a
shareholder is entitled to be shareholder is entitled to be
held harmless from and held harmless from and
indemnified against all loss and indemnified against all loss and
expense arising from such expense arising from such
liability. liability.
Every note, bond, contract, Every note, bond, contract,
instrument, certificate or instrument, certificate or
undertaking made or issued by any undertaking made or issued by any
Trustees or Trustee or by any Trustees or Trustee or by any
officers or officer must recite officers or officer must recite
that the same was executed or that the same was executed or
made by or on behalf of the Trust made by or on behalf of the Trust
and that obligations of such and that obligations of such
instrument are not binding on any instrument are not binding on any
of them or shareholders of them or shareholders
individually. individually.
SHAREHOLDER VOTING Shareholders have the power to Shareholders have the power to
RIGHTS: vote only (i) for the election vote only (i) for the election or
or, to the extent required by removal of Trustees; (ii) with
law, removal of Trustees; (ii) respect to any investment
with respect to any termination, adviser; (iii) with respect to
by the shareholders, of the Trust any termination, by the
or series or class of the Trust; shareholders, of the Trust or
(iii) with respect to derivative series or class of the Trust;
actions, to the extent certain (iv) with respect to any
demand requirements are met; and amendment, by the Trustees that
(iv) with respect to any other requires shareholder
matters required by law, the authorization; (v) with respect
organizational documents or to derivative actions similar to
deemed desirable by the Board of a Massachusetts corporation; and
Trustees. (vi) with respect to any other
matters required by law, the
organizational documents, or
deemed desirable by the Board of
Trustees.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
SHAREHOLDER LIABILITY: A shareholder or former shareholder
held to be personally liable solely
by reason of his or her being or
having been a shareholder is
entitled to be held harmless from
and indemnified against all loss and
expense arising from such liability.
Every note, bond, contract,
instrument, certificate or
undertaking made or issued by any
Trustees or Trustee or by any
officers or officer must recite that
the same was executed or made by or
on behalf of the Trust and that
obligations of such instrument are
not binding on any of them or
shareholders individually.
SHAREHOLDER VOTING Shareholders have the power to vote
RIGHTS: only (i) for the election or removal
of Trustees; (ii) with respect to
any investment adviser; (iii) with
respect to any termination, by the
shareholders, of the Trust or series
or class of the Trust; (iv) with
respect to any amendment, by the
shareholders, to the Declaration of
Trust; (v) with respect to
derivative actions similar to a
Massachusetts corporation, to the
extent certain demand requirements
are met; and (vi) with respect to
any other matters required by law,
the organizational documents or
deemed desirable by the Board of
Trustees.
</Table>
16
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
No shareholder may bring a
derivative claim without first
requesting the Trustees to bring
or maintain such action,
proceeding or claim. Such demand
shall be excused only when the
plaintiff makes a specific
showing that irreparable injury
to the Trust or series would
otherwise result.
Each whole share (or fractional On a record date, each
share) outstanding on the record outstanding share or fractional
date is entitled to a number of share is entitled to one vote or
votes on any matter which it is a proportional fractional vote.
entitled to vote equal to the net Shareholders may vote together
asset value of the share (or with shareholders of the other
fractional share) in U.S. dollars series of the Trust on matters
determined at the close of affecting the Trust as a whole,
business on the record date (for such as the election of Trustees.
example, a share having a net
asset value of $10.50 would be
entitled to 10.5 votes).
Shareholders will vote together
with shareholders of the other
series of the Trust on matters
affecting the Trust as a whole,
such as the election of Trustees.
SHAREHOLDER MEETINGS: Shareholders have no specific Shareholders have no specific
right to call meetings, except as right to call meetings, except as
may be required by applicable may be required by applicable
law, including the Investment law, including the Investment
Company Act of 1940. Company Act of 1940.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
Each whole share (or fractional
share) outstanding on the record
date is entitled to a number of
votes on any matter which it is
entitled to vote equal to the net
asset value of the share (or
fractional share) in U.S. dollars
determined at the close of business
on the record date (for example, a
share having a net asset value of
$10.50 would be entitled to 10.5
votes).
Shareholders may vote together with
shareholders of the other series of
the Trust on matters affecting the
Trust as a whole, such as the
election of Trustees.
SHAREHOLDER MEETINGS: Shareholders may call a meeting upon
written application of shareholders
holding at least 10% of the
outstanding shares, or 10% of the
outstanding shares of any series or
class (if shareholders of such
series or class are entitled to vote
by individual series or class. The
application must state the
</Table>
17
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
SHAREHOLDER QUORUM: 30% of the shares entitled to 30% of the shares entitled to
vote at the meeting. vote at the meeting.
SHAREHOLDER CONSENT: Majority consent required for Majority consent required for
shareholder action taken without shareholder action taken without
a meeting. a meeting.
NOTICE TO SHAREHOLDERS: Notice of shareholder meetings is Written notice of shareholder
to be mailed, postage prepaid, or meetings must be given not less
sent by facsimile or other than seven days in advance.
electronic submission not less
than seven days before the date Notice is not expressly required
of such meeting. to include the purpose for which
Notice is not expressly required the meeting is called.
to state the purpose for which
the meeting is called.
SHAREHOLDER PROXIES: Shareholders may put a proxy in Shareholders may put a proxy in
place for a duration of up to six place for a duration of up to six
months. months.
TRUSTEE'S POWER TO AMEND The Declaration of Trust may be The Declaration of Trust may be
DECLARATION OF TRUST: amended at any time by an amended at any time by an
instrument in writing signed by a instrument in writing signed by a
majority of the then Trustees, majority of the then Trustees
provided that, for non- when authorized so to do by vote
ministerial amendments, notice is of a majority of the shares
promptly mailed to shareholders entitled to vote with respect to
as of the day such amendment is such amendment, except that
effective. shareholder authorization is not
required for amendments to change
the name of the Trust, supply any
omission, cure any ambiguity or
cure, correct or supplement any
defective or inconsistent
provision.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
purpose of the meeting and the
matters to be acted upon.
SHAREHOLDER QUORUM: 30% of the shares entitled to vote
at the meeting.
SHAREHOLDER CONSENT: Majority consent required for
shareholder action taken without a
meeting.
NOTICE TO SHAREHOLDERS: Notice of shareholder meetings is to
be mailed, postage prepaid, not less
than seven days before the date of
such meeting.
Notice must include the purpose or
purposes for which a meeting is
called.
SHAREHOLDER PROXIES: Shareholders may put a proxy in
place for a duration of up to six
months.
TRUSTEE'S POWER TO AMEND Except when otherwise required by
DECLARATION OF TRUST: the Investment Company Act of 1940,
the Declaration of Trust may be
amended by a majority vote of the
Trustees, provided that, for
non-ministerial amendments, notice
is mailed promptly to shareholders
as of the day such amendment is
effective.
</Table>
18
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
TERMINATION OF TRUST: Shareholders have the right to Shareholders have the right to
terminate the Trust, or series or terminate the Trust or series
class, upon approval of at least upon approval of at least
66 2/3% of the outstanding shares two-thirds of the outstanding
of the Trust or the affected shares of the Trust or the
series or class. affected series.
Trustees may terminate the Trust, Trustees may terminate the Trust
or any series or class, without or series without shareholder
shareholder approval by written approval by written notice to the
notice to shareholders. shareholders.
MERGER OR CONSOLIDATION The Declaration of Trust provides Shareholders have no express
TRUST: that a consolidation, merger or right under the Declaration of
transfer may be authorized by Trust to vote on mergers or
vote of a majority of the consolidations.
Trustees then in office without
shareholder approval, unless
otherwise required by law.
REMOVAL OF TRUSTEES: Trustee may be removed, with or Trustee may be removed, with or
without cause, by a majority of without cause, by (i) a majority
Trustees then in office. of Trustees then in office or
(ii) by a vote of two-thirds of
the holders of outstanding
shares, with, at a meeting called
for the purpose.
DIRECTOR/TRUSTEE Not limited. Not limited.
COMMITTEES:
TRUSTEE LIABILITY: Trustees are not personally Trustees are not personally
liable for claims against the liable for claims against the
Trust or for any neglect or Trust or for any neglect or
wrongdoing of any officer, agent, wrongdoing of any officer, agent,
employee, investment adviser, or employee, investment adviser, or
principal underwriter of the principal underwriter of the
Trust. Trust.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
TERMINATION OF TRUST: Shareholders have the right to
terminate the Trust, or series or
class, upon approval of at least a
majority of the outstanding shares
of the Trust or the affected series
or class.
Trustees may terminate the Trust, or
series or class, without shareholder
approval by written notice to
shareholders.
MERGER OR CONSOLIDATION Shareholders have no express right
TRUST: under the Declaration of Trust to
vote on mergers or consolidations.
REMOVAL OF TRUSTEES: Trustee may be removed, with or
without cause, by (i) a majority of
Trustees then in office; (ii) by a
vote of two-thirds of the holders of
outstanding shares at a meeting
called for the purpose; or (iii) by
the holders of two-thirds of the
outstanding shares by declaration in
writing filed with the custodian of
the Trust.
DIRECTOR/TRUSTEE Not limited.
COMMITTEES:
TRUSTEE LIABILITY: Trustees are not personally liable
for claims against the Trust or for
any neglect or wrongdoing of any
officer, agent, employee, investment
adviser, or principal underwriter of
the Trust.
</Table>
19
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
Each Trustee is not responsible Each Trustee is not responsible
for the act or omission of any for the act or omission of any
other Trustee and may be liable other Trustee and may be liable
only by reason of willful only by reason of willful
misfeasance, bad faith, gross misfeasance, bad faith, gross
negligence or reckless disregard negligence or reckless disregard
of the duties involved in the of the duties involved in the
conduct of his office. conduct of his office.
The appointment, designation or
identification of a Trustee as
the chairman of the Board, the
lead or assistant lead
independent Trustee, a member or
chairman of a committee of the
Board, an expert on any topic or
in any area (including an audit
committee financial expert) or as
having any other special
appointment, designation or
identification shall not (a)
impose on that person any duty,
obligation or liability that is
greater than the duties,
obligations and liabilities
imposed on that person as a
Trustee in the absence of the
appointment, designation or
identification or (b) affect in
any way such Trustee's rights or
entitlement to indemnification,
and no Trustee who has special
skills or expertise, or is
appointed, designated or
identified as aforesaid, shall
(x) be held to a higher standard
of care by virtue thereof or (y)
be limited with respect to any
indemnification to which such
Trustee would otherwise be
entitled.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
Each Trustee is not responsible for
the act or omission of any other
Trustee and may be liable only by
reason of willful misfeasance, bad
faith, gross negligence or reckless
disregard of the duties involved in
the conduct of his office.
</Table>
20
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
TRUSTEE INDEMNIFICATION: The By-Laws state that the Trust The Declaration of Trust states
will indemnify each of its that the Trust will indemnify
Trustees and officers who are not each of its Trustees and officers
employees or officers of any against all liabilities and
investment adviser to the Trust expenses, including amounts paid
or any affiliated person thereof in satisfaction of judgments, in
and may indemnify each of its compromise, as fines and
officers who are employees or penalties, and as counsel fees,
officers of any investment reasonably incurred by such
adviser to the Trust or any person while in office or
affiliated person thereof against thereafter, by reason of the
all liabilities and expenses, indemnified person's service as a
including amounts paid in Trustee or officer. The Trust
satisfaction of judgments, in will not indemnify its Trustees
compromise, as fines and and officers against any
penalties, and as counsel fees, liability to the Trust or to its
reasonably incurred by such shareholders to which he or she
person while in office or would otherwise be subject by
thereafter, by reason of the reason of willful misfeasance,
indemnified person's service as a bad faith, gross negligence or
Trustee or officer. The Trust reckless disregard of the duties
will not indemnify its Trustees involved in the conduct of such
and officers against any person's office.
liability to the Trust or to its
shareholders to which he or she Under the Declaration of Trust,
would otherwise be subject by in the absence of a final
reason of willful misfeasance, decision on the merits by an
bad faith, gross negligence or adjudicating body that such
reckless disregard of the duties person is liable by reason of
involved in the conduct of his willful misfeasance, bad faith,
office. gross negligence or reckless
Under the By-Laws, in the absence disregard of the duties involved
of a final decision on the merits in the conduct of their office,
by an adjudicating body that such indemnification will be provided
person has not acted in good if (a) approved as in the best
faith in the reasonable belief interests of the Trust, after
that such person's action was in notice that it involves such
the best interests of the Trust indemnification, by at least a
or is liable to the Trust or its majority of the disinterested
Shareholders by reason of willful Trustees acting on the matter
(provided that a majority of the
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
TRUSTEE INDEMNIFICATION: The Declaration of Trust states that
the Trust will indemnify each of its
Trustees and officers against all
liabilities and expenses, including
amounts paid in satisfaction of
judgments, in compromise, as fines
and penalties, and as counsel fees,
reasonably incurred by such person
while in office or thereafter, by
reason of the indemnified person's
service as a Trustee or officer. The
Trust will not indemnify its
Trustees and officers against any
liability to the Trust or to its
shareholders to which he or she
would otherwise be subject by reason
of willful misfeasance, bad faith,
gross negligence or reckless
disregard of the duties involved in
the conduct of his office.
Under the Declaration of Trust, in
the absence of a final decision on
the merits by an adjudicating body
that such person is not liable by
reason of willful misfeasance, bad
faith, gross negligence or reckless
disregard of the duties involved in
the conduct of their office, no
indemnification will be provided
unless such person is determined to
be not liable by (a) a vote of a
majority of the disinterested
Trustees or (b) an independent legal
counsel as expressed in a written
opinion.
</Table>
21
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
misfeasance, bad faith, gross disinterested Trustees then in
negligence or reckless disregard office act on the matter) upon a
of the duties involved in the determination, based upon a
conduct of his or her office, review of readily available
indemnification will be provided facts, that such person is not
if (a) approved, after notice liable to the Trust or its
that it involves such shareholders by reason of willful
indemnification, by at least a misfeasance, bad faith, gross
majority of the disinterested negligence or reckless disregard
Trustees acting on the matter of the duties involved in the
(provided that a majority of the conduct of his or her office or
disinterested Trustees then in (b) there has been obtained an
office act on the matter) upon a opinion in writing of independent
determination, based upon a legal counsel to the effect that
review of readily available such indemnification would not
facts, that such person has acted protect such person against any
in good faith in the reasonable liability to the Trust to which
belief that such person's action such person would otherwise be
was in the best interests of the subject by reason of willful
Trust and is not liable to the misfeasance, bad faith, gross
Trust or its shareholders by negligence or reckless disregard
reason of willful misfeasance, of the duties involved in the
bad faith, gross negligence or conduct of his or her office.
reckless disregard of the duties
involved in the conduct of his or
her office or (b) there has been
obtained an opinion in writing of
independent legal counsel, based
upon a review of readily
available facts to the effect
that such person appears to have
acted in good faith in the
reasonable belief that such
person's action was in the best
interests of the Trust and that
such indemnification would not
protect such person against any
liability to the Trust to which
such person would otherwise be
subject by reason of willful
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
</Table>
22
<Table>
<Caption>
COLUMBIA FUNDS TRUST I
COLUMBIA FUNDS TRUST III
COLUMBIA FUNDS TRUST IV
COLUMBIA FUNDS TRUST V
COLUMBIA FUNDS TRUST VI
THE ACQUIRING TRUST COLUMBIA FUNDS TRUST VII
--------------------------------- ---------------------------------
misfeasance, bad faith, gross
negligence or reckless disregard
of the duties involved in the
conduct of his or her office.
LEGAL EXPENSES: The By-Laws state that legal The Declaration of Trust states
expenses may be paid from time to that legal expenses may be paid
time by the Trust in advance of from time to time by the Trust in
the final disposition of any such advance of the final disposition
proceeding if the Trust receives of any such proceeding if the
a written undertaking by the Trust receives a written
indemnified person to reimburse undertaking by the indemnified
the Trust in the event it is person to reimburse the Trust in
subsequently determined that the the event it is subsequently
indemnified person is not determined that the indemnified
entitled to such indemnification person is not entitled to such
and (a) the indemnified person indemnification and (a) the
provides security for his indemnified person provides
undertaking, or (b) the Trust is security for his undertaking, or
insured against losses arising by (b) the Trust is insured against
reason of any lawful advances, or losses arising by reason of any
(c) a majority of the lawful advances, or (c) a
disinterested, non-party Trustees majority of the disinterested,
or an independent legal counsel, non-party Trustees or an
as expressed in a written independent legal counsel, as
opinion, determines that there is expressed in a written opinion,
reason to believe that the determines that there is reason
indemnified person ultimately to believe that the indemnified
will be found entitled to person ultimately will be found
indemnification. entitled to indemnification.
DIVIDENDS: Not limited. Not limited.
<Caption>
COLUMBIA FUNDS TRUST VIII
COLUMBIA FUNDS TRUST IX
(PRIOR TO AMENDMENT AND RESTATEMENT)
COLUMBIA FUNDS TRUST XI
------------------------------------
LEGAL EXPENSES: The Declaration of Trust states that
legal expenses may be paid from time
to time by the Trust in advance of
the final disposition of any such
proceeding if the Trust receives a
written undertaking by the
indemnified person to reimburse the
Trust (unless it is determined that
such person is ultimately entitled
to indemnification) and (a) the
indemnified person provides security
for his undertaking, or (b) the
Trust is insured against losses
arising by reason of any lawful
advances, or (c) a majority of the
disinterested, non-party Trustees or
an independent legal counsel, as
expressed in a written opinion,
determines that there is reason to
believe that the indemnified person
ultimately will be found entitled to
indemnification.
DIVIDENDS: Not limited.
</Table>
23
FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATIONS
The Reorganizations are intended to be tax-free. As a condition to each Fund's
obligation to consummate the Reorganization, the Fund will receive an opinion
from Ropes & Gray LLP, counsel to each Trust, to the effect that, on the basis
of the existing provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), the treasury regulations promulgated thereunder, current administrative
rules and court decisions, generally for federal income tax purposes, except as
noted below:
(i) the Reorganization will constitute a reorganization within the meaning of
Section 368(a) of the Code, and the Fund and the New Fund will each be a
"party to a reorganization" within the meaning of Section 368(b) of the
Code;
(ii) under Section 361 of the Code, no gain or loss will be recognized by the
Fund upon the transfer of its assets to the New Fund in exchange for
Reorganization Shares and the assumption by the New Fund of the Fund's
liabilities, or upon the distribution of such Reorganization Shares by the
Fund to the shareholders of the Fund in liquidation;
(iii) under Section 354 of the Code, the Fund shareholders will recognize no
gain or loss upon exchange of their shares of the Fund for the
Reorganization Shares;
(iv) under Section 358 of the Code, the aggregate tax basis of the
Reorganization Shares to be received by each shareholder of the Fund will
be the same as the aggregate tax basis of the shares of the Fund exchanged
therefor;
(v) under Section 1223(1) of the Code, the holding period of the
Reorganization Shares received by each shareholder of the Fund will
include the holding period for the Fund shares exchanged for the
Reorganization Shares; provided such shares of the Fund were held as a
capital asset on the date of the exchange;
(vi) under Section 1032 of the Code, no gain or loss will be recognized by the
New Fund upon receipt of the assets transferred to the New Fund pursuant
to the Plan in exchange for the Reorganization Shares and assumption by
the New Fund of the liabilities of the Fund;
(vii) under Section 362(b) of the Code, the New Fund's tax basis in the assets
that the New Fund receives from the Fund will be the same as the Fund's
tax basis in such assets immediately prior to such exchange;
24
(viii) under Section 1223(2) of the Code, the New Fund's holding period in such
assets will include the Fund's holding period in such assets;
(ix) under Section 381 of the Code, the New Fund will succeed to the capital
loss carryovers of the Fund, if any, but the use by the New Fund of any
such capital loss carryovers (and of capital loss carryovers of the New
Fund) may be subject to limitation under Sections 383 and 284 of the Code.
The opinion will be qualified to reflect that the Code requires that certain
contracts or securities (including, in particular, futures contracts, certain
foreign currency contracts, "non-equity" options and investments in "passive
foreign investment companies") be marked-to-market (treated as sold for their
fair market value) at the end of a taxable year (or upon their termination or
transfer).
The opinion will be based on certain factual certifications made by officers of
each Trust and the Funds and will also be based on customary assumptions. Each
Fund has agreed to make and provide additional representations to Ropes & Gray
with respect to each Fund that are reasonably requested by Ropes & Gray. The
opinion is not a guarantee that the tax consequences of the Reorganizations will
be as described above. The opinion will note and distinguish certain published
precedent. There is no assurance that the Internal Revenue Service or a court
would agree with the opinion.
TRUSTEES' COMPENSATION
The members of the Board of Trustees also serve as trustees for certain other
portfolios in the Fund Complex. As of December 31, 2004, the Fund Complex
consisted of 127 open-end funds and 11 closed-end management investment company
portfolios. Two-thirds of the Trustees' fees are allocated among the funds
within the Fund Complex based on the relative net assets of each fund and
one-third of the fees is divided equally among the funds within the Fund
Complex.
FOR MORE INFORMATION REGARDING THE COMPENSATION OF THE TRUSTEES, SEE APPENDIX
B.1 AND APPENDIX B.2 TO THIS PROXY STATEMENT.
SHAREHOLDER COMMUNICATIONS
Shareholders may communicate with the Trustees as a group or individually. Any
such communications should be sent to the Fund's Board or an individual Trustee
in writing, c/o the Secretary of the Funds, One Financial Center, Boston, MA
02111-2621. The Secretary may determine
25
not to forward to the Board or a Trustee any letter that does not relate to the
business of a Fund.
TRUSTEE SHARE OWNERSHIP
The table in Appendix C shows, as of December 31, 2004, the dollar range of
equity securities beneficially owned by each Trustee (i) in each of the Funds,
and (ii) in all funds overseen by the Trustee in the Fund Complex. Except as
shown in Appendix C, the Trustees did not, as of December 31, 2004 beneficially
own shares of the Funds.
TRUSTEES' MEETINGS AND COMMITTEES
The Board is responsible for the overall management and supervision of your
Fund's affairs and for protecting the interests of your Fund's shareholders. For
the calendar year ended December 31, 2004, your Fund held 18 meetings (5 regular
joint Board meetings and 13 special joint Board meetings). The Funds are not
required under their Agreements and Declarations of Trust to hold annual
meetings, but have voluntarily undertaken to hold meetings to elect Trustees at
least every five years.
The Board has created several committees to perform specific functions on behalf
of the Funds. The members of each committee, along with a description of each
committee's functions, appear below, followed by a table that sets forth the
number of meetings held by each committee during the last fiscal year.
1. AUDIT COMMITTEE
Your Fund has an Audit Committee (the "Audit Committee") comprised of Trustees
who are not "interested persons" (as defined in the 1940 Act) of any Fund. Each
member of the Audit Committee must be financially literate and at least one
member must have prior accounting experience or related financial management
expertise.
The Audit Committee serves as an independent and objective party to monitor your
Fund's accounting policies, financial reporting and internal control systems and
the work of your Fund's independent registered public accountant. The Audit
Committee also serves to provide an open avenue of communication between the
independent registered public accountants, Columbia Management Group, Inc.'s
("Columbia") internal accounting staff and the Board. The principal functions of
the Audit Committee are to assist Board oversight of (1) the integrity of your
Fund's financial statements, (2) your Fund's compliance with legal and
regulatory requirements, (3) the independent registered public accountant's
26
qualifications and independence, (4) the performance of Columbia Management's
internal audit function, and (5) the independent registered public accountant.
The Audit Committee is directly responsible for the appointment, compensation,
retention and oversight of the work of the independent registered public
accountants (including the resolution of disagreements between management and
the independent registered public accountants regarding financial reporting) for
the purpose of preparing or issuing an audit report or performing other review
or attest services for your Fund.
The Funds' Audit Committee members are Ms. Verville and Messrs. Hacker, Stitzel
and Woolworth.
Based on the recommendation from the Audit Committee and on its own review, the
Board selected PricewaterhouseCoopers LLP ("PwC") as independent registered
public accountant for your Fund for its fiscal year. Representatives of PwC are
not expected to be at the Meeting, but have been given the opportunity to make a
statement if they so desire and will be available should any matter arise
requiring their presence.
2. GOVERNANCE COMMITTEE
Messrs. Lowry, Mayer, Simpson and Theobald are members of the Governance
Committee of each Fund. The Funds have no nominating or compensation committee.
The Governance Committee performs certain of the functions typically performed
by those committees. Among other things, the Governance Committee recommends to
the Board nominees for Trustee and nominees for appointment to various
committees; performs periodic evaluations of the effectiveness of the Board;
reviews and recommends to the Board policies and practices to be followed in
carrying out the Trustees' duties and responsibilities; and reviews and makes
recommendations to the Board regarding the compensation of the Trustees who are
not affiliated with Columbia. On February 9, 2005, the Governance Committee
adopted a written charter which sets forth the Governance Committee's structure,
duties and powers, and methods of operation. A copy of the Governance Committee
Charter is attached as Appendix D.
Three of the four Governance Committee members, Messrs. Lowry, Simpson and
Theobald, who are not "interested persons" (as defined in the 1940 Act) of any
Fund ("Governance Committee Independent Trustees"), participate in the
consideration, selection and nomination of Trustees. The Governance Committee
Independent Trustees will consider candidates for Trustee identified by any
reasonable source, including current Independent Trustees, Fund management, Fund
shareholders and other persons or entities. Shareholders of your Fund who wish
to nominate a candidate to
27
your Fund's Board may send information regarding prospective candidates to the
Governance Committee, in care of the relevant Fund, at One Financial Center,
Boston, MA 02111-2621. The information should include evidence of the
shareholders' Fund ownership, a full listing of the proposed candidate's
education, experience, current employment, date of birth, names and addresses of
at least three professional references, information as to whether the candidate
is not an "interested person" under the 1940 Act and such other information as
may be helpful to the Governance Committee Independent Trustees in evaluating
the candidate. All satisfactorily completed information packages regarding a
candidate will be forwarded to a member of the Governance Committee for
consideration. Recommendations for candidates will be evaluated in light of
whether the number of Trustees of your Fund is expected to be increased and
anticipated vacancies. All nominations from Fund shareholders will be
considered. There may be times when the Governance Committee is not recruiting
new Board members. In that case, shareholder recommendations will be maintained
on file pending the active recruitment of Trustees.
When considering candidates for Trustee, the Governance Committee Independent
Trustees consider, among other things, whether prospective nominees have
distinguished records in their primary careers, personal and professional
integrity, and substantive knowledge in areas important to the Board's
operations, such as background or education in finance, auditing, securities
law, the workings of the securities markets, or investment advice. For
candidates to serve as Independent Trustees, independence from your Fund's
investment adviser, its affiliates and other principal service providers is
critical, as is an independent and questioning mind-set. In each case, the
Governance Committee Independent Trustees will evaluate whether a candidate is
an "interested person" under the 1940 Act. The Governance Committee Independent
Trustees also consider whether a prospective candidate's workload would be
consistent with regular attendance at Board meetings and would allow him or her
to be available for service on Board committees, and devote the additional time
and effort necessary to stay apprised of Board matters and the rapidly changing
regulatory environment in which the Funds operate. Different substantive areas
may assume greater or lesser significance at particular times, in light of a
Board's present composition and its perceptions about future issues and needs.
The Governance Committee Independent Trustees initially evaluate prospective
candidates on the basis of their resumes, considered in light of the criteria
discussed above. Those prospective candidates that appear likely to be able to
fill a significant need of the Board would be contacted by a Governance
Committee Independent Trustee by telephone to discuss the position; if there
appeared to be sufficient interest, an in-person meeting
28
with one or more of the Governance Committee Independent Trustees would be
arranged. If a Governance Committee Independent Trustee, based on the results of
these contacts, believes he or she has identified a viable candidate, he or she
would air the matter with the other Governance Committee Independent Trustees
for input. Any request by Fund management to meet with the prospective candidate
would be given appropriate consideration. The Funds have not paid a fee to third
parties to assist in finding nominees.
3. ADVISORY FEES & EXPENSES COMMITTEE
Ms. Kelly and Messrs. Mayer, Nelson and Neuhauser are members of the Advisory
Fees & Expenses Committee of each Fund. The Advisory Fees & Expenses Committee's
functions include reviewing and making recommendations to the Board as to
contracts requiring approval of a majority of the disinterested Trustees and as
to any other contracts that may be referred to the committee by the Board.
4. COMPLIANCE COMMITTEE
Mses. Kelly and Verville, and Messrs. Nelson, Neuhauser, Simpson and Stitzel are
members of the Compliance Committee of the Board of Trustees of the Funds. The
Compliance Committee's functions include providing oversight of the monitoring
processes and controls regarding the Funds. The Committee supervises legal,
regulatory and internal rules, policies, procedures and standards other than
those relating to accounting matters and oversight of compliance by the Funds'
investment adviser, principal underwriter and transfer agent.
<Table>
<Caption>
NUMBER OF
MEETINGS
FOR CALENDAR
YEAR ENDED
DECEMBER 31, 2004
-----------------
Audit Committee 11
Governance Committee 4
Advisory Fees & Expenses Committee 7
Compliance Committee 6
</Table>
5. INVESTMENT OVERSIGHT COMMITTEES
Each Investment Oversight Committee ("IOC") is responsible for monitoring, on an
ongoing basis, a select group of Columbia Funds and gives particular
consideration to such matters as the Funds' adherence to their investment
mandates, historical performance, changes in investment
29
processes and personnel, and proposed changes to investment objectives.
Investment personnel who manage the Funds will attend IOC meetings from time to
time to assist each IOC in its review of the Funds. Each IOC meets four times a
year. Investment Oversight Committee 1 currently consists of Messrs. Lowry,
Mayer and Neuhauser. Investment Oversight Committee 2 currently consists of Mr.
Hacker and Ms. Verville. Investment Oversight Committee 3 currently consists of
Ms. Kelley and Messrs. Stitzel and Theobald. Investment Oversight Committee 4
currently consists of Messrs. Nelson, Simpson and Woolworth.
AUDIT COMMITTEE PRE-APPROVAL OF INDEPENDENT ACCOUNTANT SERVICES
The Audit Committee is required to pre-approve the engagement of your Fund's
independent registered public accountant to provide audit and non-audit services
to your Fund and non-audit services to Columbia Management or any entity
controlling, controlled by or under common control with Columbia Management that
provides ongoing services to the Funds ("Columbia Affiliate"), if the engagement
relates directly to the operations or financial reporting of the Funds. The
engagement may be entered into pursuant to pre-approval policies and procedures
established by the Audit Committee.
The Audit Committee has adopted an Audit and Non-Audit Services Pre-Approval
Policy ("Policy"). The Policy sets forth the procedures and conditions pursuant
to which services to be performed by the Funds' independent registered public
accountant are to be pre-approved. Unless a type of service receives general
pre-approval under the Policy, it requires specific pre-approval by the Audit
Committee if it is to be provided by the independent registered public
accountant.
The Policy provides for the general pre-approval by the Audit Committee of
certain: (i) audit services to the Funds; (ii) audit-related services to the
Funds; (iii) tax services to the Funds; (iv) other services to the Funds; and
(v) Fund-related services to Columbia Affiliates. The Policy requires the Fund
Treasurer and/or Director of Trustee Administration to submit to the Audit
Committee, at least annually, a schedule of the types of services that are
subject to general pre-approval. The schedule(s) must provide a description of
each type of service that is subject to general pre-approval and, where
possible, will provide projected fee caps for each instance of providing each
service. At least annually, the Audit Committee will review and approve the
types of services and review the projected fees for the next year, and may add
to, or subtract from, the list of pre-approved services from time to time, based
on subsequent determinations. In addition to the fees for each individual
service, the Audit Committee has the authority to
30
implement a fee cap on the aggregate amount of non-audit services provided to an
individual New Fund. The fee amounts listed on the schedules will be updated to
the extent necessary at each of the other regularly scheduled meetings of the
Audit Committee.
FEES PAID TO THE INDEPENDENT REGISTERED PUBLIC ACCOUNTANT
The table in Appendix E1 sets forth the aggregate fees billed by PwC for each
Fund's last two fiscal years for professional services rendered for (i) audit
services, including the audit of each Fund's financial statements and services
normally provided in connection with statutory and regulatory filings or
engagements for those fiscal years; (ii) audit-related services associated with
the review of the Funds' semi-annual financial statements; (iii) tax services
and, primarily, reviews of Fund tax returns; and (iv) other services. Please
note that the table includes amounts related to non-audit services that would
have been subject to pre-approval if Securities and Exchange Commission ("SEC")
rules relating to the pre-approval of non-audit services had been in effect at
that time.
All of the audit fees, audit-related fees, tax fees and other fees billed by PwC
for services provided to a Fund during its most recent fiscal year were
pre-approved by the Audit Committee.
The amount billed by PwC in each of the last two fiscal years for audit-related
services provided to Columbia or Columbia Affiliates for engagements that
related directly to the operations or financial reporting of each Fund was
$95,000.
The table in Appendix E2 sets forth the aggregate fees billed by PwC for
non-audit services for the Funds, Columbia and Columbia Affiliates for the last
two fiscal years.
The Audit Committee has determined that the provision of the services described
above is compatible with maintaining the independence of PwC.
REQUIRED VOTE. The affirmative vote of a plurality of the holders of shares of
beneficial interest of each Fund present at the Meeting in person or by proxy is
required for the election of each such Trustee.
II. PROPOSAL 2: ADOPTION OF STANDARDIZED FUNDAMENTAL INVESTMENT RESTRICTIONS
As described in the following proposals, the Trustees recommend that
shareholders of the affected Funds approve the elimination of and revisions to
certain fundamental investment restrictions of such Funds. Generally, the
purpose of these proposed changes is to increase each Fund's investment
31
flexibility and reduce administrative and compliance burdens by simplifying and
making uniform these fundamental investment restrictions across all Funds.
BACKGROUND. The 1940 Act requires registered investment companies like the Funds
to have "fundamental" investment restrictions governing certain of their
investment practices. Investment companies may also voluntarily designate
restrictions relating to other investment practices as fundamental.
"Fundamental" investment restrictions can be changed only by a shareholder vote.
The proposed elimination of and revisions to certain of the fundamental
investment restrictions of the Funds are discussed below. Columbia Management
has indicated that it has no present intention of changing the manner in which
it manages the Funds in response to these proposals. By eliminating those
fundamental investment restrictions that are not required and revising those
fundamental investment restrictions that are required, however, the Trustees
believe that Columbia Management will be better able to manage the Funds in a
changing regulatory or investment environment. In addition, the process of
monitoring the Funds' compliance with investment restrictions will be
simplified.
The discussion below in Proposals 2.A. through 2.M. highlights the differences
between the Funds' current fundamental investment restrictions and, where
applicable, a proposed uniform fundamental investment restriction. However,
because the current fundamental investment restrictions vary among the Funds,
shareholders of each Fund should consider comparing their Fund's current
restrictions (contained in EXHIBITS 1 through 10) with the proposed
restrictions.
2.A. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO BORROWING
MONEY, PLEDGING ASSETS AND ISSUING SENIOR SECURITIES.
AFFECTED FUNDS: All Funds except the Merger Funds
The 1940 Act requires the Funds to state the extent to which they may borrow
money and issue senior securities. Under Section 18(f)(1) of the 1940 Act, an
open-end investment company may not issue senior securities, except that it may
borrow from banks, for any purpose, up to 33 1/3% of its total assets (including
the amount borrowed). EXHIBITS 1 and 2 list the current fundamental investment
restrictions of each of the affected Funds with respect to borrowing money,
pledging assets and issuing senior securities, respectively. Generally, the
Funds' current fundamental investment restrictions are more restrictive than
these 1940 Act requirements.
32
The Trustees recommend that each affected Fund amend its policy so that it will
allow each affected Fund to issue senior securities, pledging assets or borrow
money to the full extent permitted under applicable law. The proposed changes
would automatically conform each affected Fund's policy more closely to the
exact statutory and regulatory requirements, as they exist from time to time,
without incurring the time and expense of obtaining shareholder approval to
change the restriction. In addition, the proposed changes will reduce
administrative and compliance burdens by simplifying and making uniform the
Funds' fundamental investment restrictions with respect to borrowing money and
issuing senior securities. The 1940 Act does not require a fundamental
restriction with respect to the ability to pledge assets.
The proposed amended fundamental investment restriction is as follows:
"The fund may not. . . [b]orrow money or issue senior securities except to
the extent permitted by the 1940 Act, the rules and regulations thereunder
and any applicable exemptive relief."
2.B. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO MAKING LOANS.
AFFECTED FUNDS: All Funds except the Merger Funds
The 1940 Act requires the Funds to state the extent to which they intend to make
loans to other persons. The Trustees recommend that each Fund's fundamental
investment restriction with respect to making loans be revised to reflect a
standard restriction for all the Funds. The amendment would permit each Fund to
enter into repurchase agreements and securities loans to the extent permitted by
the 1940 Act and applicable rules and exemptive relief. EXHIBIT 3 lists the
current fundamental investment restriction of each Fund with respect to making
loans.
The proposed amended fundamental investment restriction is as follows:
"The fund may not . . . [m]ake loans, except to the extent permitted by the
1940 Act, the rules and regulations thereunder and any applicable exemptive
relief."
Following the amendment, each Fund may, consistent with the 1940 Act and its
investment objective and policies, enter into repurchase agreements and
securities loans without limit. The staff of the SEC has taken the position that
a fund may not loan more than 1/3 of the total value of its assets (including
any collateral for such loans). As noted above, although Columbia Management has
no present intention of changing the way in which each Fund is managed, this
increased flexibility could assist each
33
Fund, in the future, in achieving its investment objective and responding to
changes in applicable law or regulation. The proposed change would also
automatically conform each Fund's lending policy more closely to the exact
statutory and regulatory requirements, as they exist from time to time, without
incurring the time and expense of obtaining shareholder approval to change the
policy. In addition, these proposed changes will reduce administrative and
compliance burdens by simplifying and making uniform the fundamental investment
restrictions with respect to making loans.
When a Fund enters into a repurchase agreement, it typically purchases a
security for a relatively short period of time (usually not more than seven
days), which the seller agrees to repurchase at a fixed time and price,
representing the Fund's cost plus interest. When a Fund enters into a securities
loan, it lends certain of its portfolio securities to broker-dealers or other
parties, typically in exchange for a portion of the interest earned on the
collateral posted by the borrower or a fee from the borrower. The borrower may
also pay the Fund an amount equal to any interest, dividends or other
distributions payable on the securities lent. These transactions must be fully
collateralized at all times, but involve risk to the Fund if the seller, in the
case of repurchase agreements, or the borrower, in the case of securities loans,
should default on its obligations. If the Fund's counterparty to these
transactions should become involved in bankruptcy or insolvency proceedings, it
is possible that the Fund may be treated as an unsecured creditor and may be
required to return the underlying securities or collateral, as applicable, to
the counterparty's estate.
34
2.C. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
DIVERSIFICATION OF INVESTMENTS.
AFFECTED FUNDS:
Columbia Asset Allocation Fund
Columbia Disciplined Value Fund
Columbia Dividend Income Fund
Columbia Federal Securities Fund
Columbia Global Equity Fund
Columbia Growth Stock Fund
Columbia High Yield Municipal Fund
Columbia High Yield Opportunity Fund
Columbia Income Fund
Columbia Intermediate Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Liberty Fund
Columbia Quality Plus Bond Fund
Columbia Small Cap Fund
Columbia Small Cap Value Fund
Columbia Small Company Equity Fund
Columbia Strategic Income Fund
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Tax-Managed Growth Fund
Columbia U.S. Treasury Index Fund
Columbia Utilities Fund
Columbia Young Investor Fund
The Trustees recommend that each affected Fund's fundamental investment
restriction with respect to the diversification of its investments be revised to
reflect applicable law and a uniform policy for all of the affected Funds.
Each affected Fund is a "diversified" Fund as defined in the 1940 Act. Under the
1940 Act, a "diversified" Fund generally may not, with respect to 75% of its
total assets, invest more than 5% of its total assets in the securities of any
one issuer or own more than 10% of the outstanding voting securities of such
issuer (except U.S. Government securities, cash, cash items or the securities of
other investment companies). The remaining 25% of the Fund's total assets is not
subject to this restriction.
35
EXHIBIT 4 lists the current fundamental investment restrictions of each of the
affected Funds with respect to diversification of investments. The proposed
amended fundamental investment restriction is designed to track the statutory
definition of "diversified" company and read as follows:
"The fund may not . . . [p]urchase securities (except securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities) of
any one issuer if, as a result, more than 5% of its total assets will be
invested in the securities of such issuer or it would own more than 10% of
the voting securities of such issuer, except that: (a) up to 25% of its
total assets may be invested without regard to these limitations and (b) a
Fund's assets may be invested in the securities of one or more management
investment companies to the extent permitted by the 1940 Act, the rules and
regulations thereunder, or any applicable exemptive relief."
It is intended that this restriction will be interpreted in a manner consistent
with the statutory requirements, including rules adopted and interpretations of
the SEC under Section 5 of the 1940 Act. For example, for purposes of this
restriction, in accordance with Rule 5b-2 of the 1940 Act, the value of a
guarantee or letter of credit may be excluded from the value of a Fund's
investments in the guarantor (or issuer of the letter of credit) if the
aggregate value of securities owned by the Fund and guaranteed by such guarantor
(plus any other investments in securities issued by the guarantor) does not
exceed 10% of the Fund's total assets.
In addition, for Columbia Massachusetts Intermediate Municipal Bond Fund,
Columbia Connecticut Intermediate Municipal Bond Fund, Columbia New Jersey
Intermediate Municipal Bond Fund, Columbia New York Intermediate Municipal Bond
Fund, Columbia Rhode Island Intermediate Municipal Bond Fund, Columbia
Intermediate Tax-Exempt Bond Fund, Columbia Tax-Exempt Fund and Columbia
Tax-Exempt Insured Fund, the proposed restriction would provide that:
"For purposes of this restriction, tax exempt securities that are supported
solely by the revenues of a particular private entity will be deemed to
have been issued by that entity."
The Trustees recommend that the affected Funds' current fundamental investment
restrictions with respect to diversification of investments be amended as
proposed in order to conform the affected Funds' restrictions to the statutory
requirements discussed above. These proposed changes will reduce administrative
and compliance burdens by simplifying and making uniform the fundamental
investment restrictions with respect to diversification of investments.
36
2.D. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO INVESTMENTS IN
COMMODITIES.
AFFECTED FUNDS:
Columbia Asset Allocation Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia Disciplined Value Fund
Columbia Dividend Income Fund
Columbia Growth Stock Fund
Columbia High Yield Municipal Fund
Columbia Income Fund
Columbia Intermediate Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Quality Plus Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
Columbia Tax-Managed Growth Fund
Columbia U.S. Treasury Index Fund
Columbia Young Investor Fund
The 1940 Act requires the Funds to state a fundamental investment restriction
regarding the purchase and sale of commodities. EXHIBIT 5 lists the current
fundamental investment restriction of each Fund with respect to investment in
commodities and commodity contracts (including, for one Fund, investments in
oil, gas or mineral development programs or leases). The Funds' current
restrictions generally prohibit them from purchasing commodities or commodity
contracts, but for certain of the Funds permit them to invest in certain futures
contracts.
The proposed amended fundamental investment restriction is as follows:
"The fund may not . . . [p]urchase or sell commodities, except that a fund
may, to the extent consistent with its investment objective, invest in
securities of companies that purchase or sell commodities or which invest
in such programs, and purchase and sell options, forward contracts, futures
contracts, and options on futures contracts and enter into swap contracts
and other financial transactions relating to
37
commodities. This limitation does not apply to foreign currency
transactions, including without limitation forward currency contracts."
The Trustees recommend that the affected Funds' current fundamental investment
restrictions with respect to investments in commodities be amended as proposed.
The proposed amendment would make it clear that the Funds may utilize not only
certain futures, but also options, options on futures and other financial
transactions that do not involve physical commodities to the extent consistent
with the Funds' investment objectives and policies. The addition of financial
transactions relating to commodities is intended to give the Funds maximum
flexibility to invest in a variety of modern financial instruments that could
technically be considered commodities, but which do not involve the direct
purchase and sale of physical commodities, which are the intended focus of the
restriction. Although Columbia Management has no present intention of changing
the way in which the Funds are managed as a result of this amendment, this
investment flexibility could, in the future, assist the Funds in achieving their
investment objectives, in part because such strategies may offer opportunities
for hedging and increased investment return. These proposed changes will also
reduce administrative and compliance burdens by simplifying and making uniform
the fundamental investment restrictions with respect to commodities.
2.E. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO INVESTMENTS IN
REAL ESTATE.
AFFECTED FUNDS: All Funds except the Merger Funds
The 1940 Act requires the Funds to state a fundamental policy regarding the
purchase and sale of real estate. EXHIBIT 6 lists the current fundamental
investment restriction of each Fund with respect to investment in real estate
and securities secured by and/or of companies that deal in real estate.
Currently, many Funds' investment policies restrict their ability to sell real
estate even when the Fund acquires ownership of the real estate as a result of
its permissible investments. For instance, it is possible that a Fund could, as
a result of an investment in debt securities of a company that deals in real
estate, come to hold an interest in real estate if the issuer defaulted on its
debt obligations. Accordingly, the Trustees recommend that this policy be
modified to allow the holding and sale of real estate when ownership of real
estate results from the exercise of its rights as a holder of real estate
securities and to clarify that a Fund may invest in real estate-related
securities and real estate-backed securities or instruments.
38
The proposed amended fundamental investment restriction is as follows:
"The fund may not . . . [p]urchase or sell real estate, except a fund may
purchase securities of issuers which deal or invest in real estate and may
purchase securities which are secured by real estate or interests in real
estate and it may hold and dispose of real estate or interests in real
estate acquired through the exercise of its rights as a holder of
securities which are secured by real estate or interests therein."
These proposed changes will also reduce administrative and compliance burdens by
simplifying and making uniform the fundamental investment restrictions with
respect to real estate.
2.F. AMENDING FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO UNDERWRITING
OF SECURITIES.
AFFECTED FUNDS: All Funds except the Merger Funds
The 1940 Act requires the Funds to state the extent to which they intend to
engage in the business of underwriting securities issued by other persons. Under
applicable law, a person or company generally is considered to be an underwriter
if the person or company participates in the public distribution of securities
of other issuers, which involves purchasing the securities from another issuer
with the intention of re-selling the securities to the public. From time to
time, a Fund may purchase securities in a private transaction for investment
purposes and later sell the securities to institutional investors. Under these
or other circumstances, a Fund could possibly be considered to be within the
technical definition of an underwriter under applicable law. The SEC staff has
issued interpretations that clarify that re-sales of privately placed securities
by institutional investors, such as funds, do not make the institutional
investor an underwriter in these circumstances.
EXHIBIT 7 lists the current fundamental investment restrictions with respect to
participation in the underwriting of securities of each of the affected Funds.
The proposed amended fundamental investment restriction is as follows:
"The fund may not . . . [u]nderwrite any issue of securities issued by
other persons within the meaning of the Securities Act of 1933 except when
it might be deemed to be an underwriter either: (a) in connection with the
disposition of a portfolio security; or (b) in connection with the purchase
of securities directly from the issuer thereof in accordance with its
investment objective. This restriction shall not limit the fund's ability
to invest in securities issued by other registered investment companies."
39
The Trustees recommend that this policy be amended as proposed in order to
conform the affected Funds' policies to the statutory and related requirements
discussed above and to the policies of the other Funds. In addition, these
proposed changes will reduce administrative and compliance burdens by
simplifying and making uniform the fundamental investment restrictions with
respect to underwriting of securities.
2.G. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
PURCHASING SECURITIES ON MARGIN
AFFECTED FUNDS:
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Federal Securities Fund
Columbia Global Equity Fund
Columbia Liberty Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia U.S. Treasury Index Fund
Columbia Utilities Fund
EXHIBIT 8 lists the current fundamental investment restriction of each of the
affected Funds with respect to purchasing securities on margin. Section 12(a)(1)
of the 1940 Act generally prohibits a fund from purchasing securities on margin
in contravention of any SEC rules. To date, however, the SEC has not adopted any
such rules. There are no SEC rules requiring, and the 1940 Act does not require,
that funds state a fundamental investment policy with respect to purchasing
securities on margin. As noted above, although Columbia Management has no
present intention of changing the way in which the affected Funds are managed as
a result of the elimination of these restrictions, the Trustees believe it is
not in the Funds' best interests to maintain unnecessary fundamental policies.
Accordingly, the Trustees recommend that each affected Fund's fundamental
investment restriction with respect to purchasing securities on margin be
eliminated.
40
2.H. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
INVESTING FOR THE PURPOSE OF EXERCISING CONTROL
AFFECTED FUNDS:
Columbia Global Equity Fund
Columbia Growth Stock Fund
Columbia Income Fund
Columbia Intermediate Bond Fund
Columbia U.S. Treasury Index Fund
Columbia Young Investor Fund
EXHIBIT 9 lists the current fundamental investment restriction of each of the
affected Funds with respect to investing for the purpose of exercising control.
Applicable regulations formerly required disclosure on this subject to the
extent that a fund intends to invest in companies for the purpose of exercising
control (as defined in the 1940 Act). There is no requirement, however, that a
Fund have an affirmative policy on this subject, or that any policy that it does
have be categorized as fundamental. As noted above, although Columbia Management
has no present intention of changing the way in which the affected Funds are
managed as a result of the elimination of these restrictions, consistent with
the Trustees' belief that it is not in the Funds' best interests to maintain
fundamental investment restrictions that are not required by applicable law, the
Trustees recommend that each affected Fund's fundamental investment restriction
with respect to investing for the purpose of exercising control be eliminated.
2.I. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO SHORT
SALES
AFFECTED FUND:
Columbia U.S. Treasury Index Fund
The affected Fund has a fundamental investment restriction stating that:
The Fund may not "[m]ake short sales of securities or maintain a short
position."
There are no SEC rules requiring, and the 1940 Act does not require, that the
Fund state a fundamental investment policy with respect to short sales. As noted
above, although Columbia Management has no present intention of changing the way
in which the affected Fund is managed as a result of the elimination of these
restrictions, consistent with the Trustees' belief that it is not in the Fund's
best interests to maintain fundamental investment restrictions that are not
required by applicable law, the Trustees recommend
41
that the affected Fund's fundamental investment restriction with respect to
short sales be eliminated.
2.J. AMENDMENT TO FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
CONCENTRATING INVESTMENTS IN AN INDUSTRY
AFFECTED FUNDS: All Funds except the Merger Funds, Columbia Global Equity Fund
and Columbia Utilities Fund
Under applicable law, an investment company may not concentrate its investments
in any industry or group of industries without shareholder approval, and must
concentrate its investments consistent with any policy to do so. Although
"concentration" is not defined in the 1940 Act, the SEC has generally regarded a
fund as concentrating its investments in an industry if the fund invests more
than 25% of its net assets in securities of issuers in that industry.
EXHIBIT 10 lists the affected Funds' current fundamental investment restrictions
with respect to concentrating investments in an industry. The proposed amended
fundamental investment restriction is as follows:
"The fund may not . . . [p]urchase any securities which would cause 25% or
more of the value of its total assets at the time of purchase to be
invested in the securities of one or more issuers conducting their
principal business activities in the same industry, provided that: (a)
there is no limitation with respect to obligations issued or guaranteed by
the U.S. Government, any state or territory of the United States, or any of
their agencies, instrumentalities or political subdivisions; and (b)
notwithstanding this limitation or any other fundamental investment
limitation, assets may be invested in the securities of one or more
management investment companies to the extent permitted by the 1940 Act,
the rules and regulations thereunder and any applicable exemptive relief."
The Trustees recommend that this policy be amended as shown above to conform the
affected Funds' policies to the statutory and related requirements discussed
above and to the policies of the other Funds. In addition, these proposed
changes will reduce administrative and compliance burdens by simplifying and
making uniform the fundamental investment restrictions with respect to
concentrating investments in an industry.
42
2.K. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
PURCHASING ILLIQUID SECURITIES
AFFECTED FUND:
Columbia U.S. Treasury Index Fund
The affected Fund has a fundamental investment restriction stating that:
The Fund may not "[i]nvest more than 5% of the value of the Fund's net
assets in securities which may be illiquid because of legal or contractual
restrictions on resale or securities for which there are no readily
available market quotations. For purposes of this limitation, repurchase
agreements with maturities greater than seven days shall be considered
illiquid securities."
The 1940 Act does not require the Fund to state a fundamental investment
restriction on this matter although the staff of the SEC has taken the position
that an open-end investment company may not invest more than 15% of its net
assets in illiquid securities (10% for money market funds). As noted above,
although Columbia Management has no present intention of changing the way in
which the affected Fund is managed as a result of the elimination of these
restrictions, the Trustees believe it is not in the Fund's best interests to
maintain fundamental policies that are not required by applicable law.
Accordingly, the Trustees recommend that the affected Fund's fundamental
investment restriction with respect to purchasing illiquid securities be
eliminated.
2.L. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO
INVESTING IN SECURITIES OF OTHER INVESTMENT COMPANIES
AFFECTED FUND:
Columbia U.S. Treasury Index Fund
The affected Fund has a fundamental investment restriction stating that:
The Fund may not "[p]urchase securities of other investment companies
except as they may be acquired in connection with a merger, consolidation,
acquisition, reorganization or offer of exchange and except as permitted
under the 1940 Act. Purchases in connection with this restriction may
subject shareholders to duplicate fees and expenses."
Under the 1940 Act, a Fund's investment in investment companies is limited to,
subject to certain exceptions, (i) 3% of the total outstanding voting shares of
any one investment company, (ii) 5% of the Fund's total assets with respect to
shares of any one investment company, and (iii) 10%
43
of the Fund's total assets with respect to shares of investment companies in the
aggregate. The 1940 Act, however, does not require investment companies to
maintain fundamental investment policies with respect to investing in securities
of other investment companies. In addition, the Securities and Exchange
Commission has issued exemptive relief that permits certain investment companies
additional flexibility with respect to investments in other investment
companies. As noted above, although Columbia Management has no present intention
of changing the way in which the affected Fund is managed as a result of the
elimination of these restrictions, consistent with the Trustees' belief that it
is not in the Fund's best interests to maintain fundamental investment
restrictions that are not required by applicable law, the Trustees recommend
that the affected Fund's fundamental investment restriction with respect to
investing in securities of other investment companies be eliminated.
2.M. ELIMINATION OF FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO BUYING
AND SELLING PUTS AND CALLS
AFFECTED FUND:
Columbia Small Cap Value Fund
The affected Fund has a fundamental investment restriction stating that:
The Fund "[m]ay purchase and sell futures contracts and related options so
long as the total initial margin and premiums on the contracts do not
exceed 5% of its total assets."
The Trustees recommend that the affected Fund's fundamental investment
restriction with respect to buying and selling puts and calls be eliminated.
If this Proposal is approved, the affected Fund would be able to engage in a
variety of transactions involving the use of options to the extent consistent
with the Fund's investment objectives and policies. As noted above, although
Columbia Management has no present intention of changing the way in which the
Fund is managed as a result of the elimination of these restrictions, this
increased investment flexibility could, in the future, assist the affected Fund
in achieving its investment objective. Columbia Management also believes that
elimination of this investment restriction would reduce administrative and
compliance burdens by conforming the affected Fund's fundamental investment
restrictions with the other Funds which currently do not have a fundamental
investment restriction with respect to investments in options. For more
information regarding options on futures, see Proposal 2.D. above.
44
A Fund may purchase put options to protect its portfolio holdings in an
underlying security against a decline in market value. Such protection is
provided during the life of the put option since the Fund, as holder of the
option, is able to sell the underlying security at the put exercise price
regardless of any decline in the underlying security's market price. In order
for a put option to be profitable, the market price of the underlying security
must decline sufficiently below the exercise price to cover the premium and
transaction costs. By using put options in this manner, a fund will reduce any
profit it might otherwise have realized from appreciation of the underlying
security by the premium paid for the put option and by transaction costs.
A Fund may purchase call options to hedge against an increase in the price of
securities that the fund wants ultimately to buy. Such hedge protection is
provided during the life of the call option since the Fund, as holder of the
call option, is able to buy the underlying security at the exercise price
regardless of any increase in the underlying security's market price. In order
for a call option to be profitable, the market price of the underlying security
must rise sufficiently above the exercise price to cover the premium and
transaction costs.
The successful use of a Fund's options strategies depends on the ability of
Columbia Management to forecast correctly interest rate and market movements.
When a Fund purchases an option, it runs the risk that it will lose its entire
investment in the option in a relatively short period of time, unless the Fund
exercises the option or enters into a closing sale transaction before the
option's expiration. If the price of the underlying security does not rise (in
the case of a call) or fall (in the case of a put) to an extent sufficient to
cover the option premium and transaction costs, the Fund will lose part or all
of its investment in the option. This contrasts with an investment by the Fund
in the underlying security, since the Fund will not realize a loss if the
security's price does not change.
The effective use of options also depends on a Fund's ability to terminate
option positions at times when Columbia Management deems it desirable to do so.
There is no assurance that a Fund will be able to effect closing transactions at
any particular time or at an acceptable price.
REQUIRED VOTE. Shareholders of each Fund are entitled to vote on each Proposal
2.A. through 2.M. if the Proposal affects their Fund, voting separately by Fund.
Approval of each of Proposals 2.A. through 2.M. requires the affirmative vote of
a "majority of the outstanding voting securities" of a Fund entitled to vote on
such Proposal. As defined by the 1940 Act, a "majority of the outstanding voting
securities" means the vote of (i) 67% or more of the Fund's shares present at
the Meeting, if the
45
holders of more than 50% of the outstanding shares of the Fund are represented
at the Meeting in person or by proxy, or (ii) more than 50% of the Fund's
outstanding shares, whichever is less. To the extent multiple Proposals apply to
the same Fund, the adoption of any of these Proposals is not contingent on the
adoption of any other Proposal by shareholders of the Fund. In addition, with
respect to each Fund, the adoption of any of these Proposals 2.A. through 2.M.
is not contingent on election of any Trustees pursuant to Proposal 1.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT SHAREHOLDERS VOTE FOR PROPOSALS 2.A.
THROUGH 2.M., AS APPLICABLE.
III. OTHER INFORMATION
Certain additional information regarding Columbia Management and the Meeting is
presented below.
MANAGEMENT
Columbia Management, located at One Financial Center, Boston, MA 02111, is the
Funds' investment adviser. Columbia Management, a registered investment adviser,
has been an investment adviser since 1969. Columbia Funds Distributor, Inc.
("CFD"), located at One Financial Center, Boston, MA 02111, is the Funds'
distributor. Columbia Management and CFD are wholly owned subsidiaries of
Columbia Management Group, Inc. ("CMG"), which is a wholly owned subsidiary of
Bank of America Corporation. Prior to April 1, 2004, CMG was an indirect wholly
owned subsidiary of Fleet Boston Financial Corporation. Effective April 1, 2004,
Fleet Boston Financial Corporation was acquired by Bank of America Corporation.
Bank of America is one of the world's largest financial institutions, serving
individual consumers, small businesses and large corporations and institutions
with a full range of banking, investing, asset management and other financial
and risk management products and services. CMG is located at One Financial
Center, Boston, MA 02111.
LEGAL PROCEEDINGS
On February 9, 2005, Columbia Management and CFD (collectively, the "Columbia
Group") entered into an Assurance of Discontinuance with the New York Attorney
General ("NYAG") (the "NYAG Settlement") and consented to the entry of a
cease-and-desist order by the Securities and Exchange Commission ("SEC") (the
"SEC Order"). The SEC Order and the NYAG Settlement are referred to collectively
as the "Settlements". The Settlements contain substantially the same terms and
conditions as
46
outlined in the agreements in principle which Columbia Group entered into with
the SEC and NYAG in March 2004.
Under the terms of the SEC Order, the Columbia Group has agreed among other
things, to: pay $70 million in disgorgement and $70 million in civil money
penalties; cease and desist from violations of the antifraud provisions and
certain other provisions of the federal securities laws; maintain certain
compliance and ethics oversight structures; retain an independent consultant to
review the Columbia Group's applicable supervisory, compliance, control and
other policies and procedures; and retain an independent distribution consultant
(see below). The Columbia Funds have also voluntarily undertaken to implement
certain governance measures designed to maintain the independence of their
boards of trustees. The NYAG Settlement also, among other things, requires
Columbia Management and its affiliates, Banc of America Capital Management, LLC
and BACAP Distributors, LLC, to reduce certain Columbia Funds, Nations Funds and
other mutual funds management fees collectively by $32 million per year for five
years, for a projected total of $160 million in management fee reductions.
Pursuant to the procedures set forth in the SEC order, the $140 million in
settlement amounts described above will be distributed in accordance with a
distribution plan to be developed by an independent distribution consultant, who
is acceptable to the SEC staff and the Columbia Funds' independent trustees. The
distribution plan must be based on a methodology developed in consultation with
the Columbia Group and the Funds' independent trustees and not unacceptable to
the staff of the SEC. At this time, the distribution plan is still under
development. As such, any gain to the fund or its shareholders can not currently
be determined.
As a result of these matters or any adverse publicity or other developments
resulting from them, there may be increased redemptions or reduced sales of Fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Columbia Funds.
A copy of the SEC Order is available on the SEC website at http://www.sec.gov. A
copy of the NYAG Settlement is available as part of the Bank of America
Corporation Form 8-K filing on February 10, 2005.
In connection with events described in detail above, various parties have filed
suit against certain funds, the Trustees of the Columbia Funds, FleetBoston
Financial Corporation and its affiliated entities and/or Bank of America
Corporation and its affiliated entities. More than 300 cases including those
filed against entities unaffiliated with the funds, their Boards, FleetBoston
Financial Corporation and its affiliated entities and/or Bank of America
Corporation and its affiliated entities have been
47
transferred to the Federal District Court in Maryland and consolidated in a
multi-district proceeding (the "MDL").(1) The MDL is ongoing.
On January 11, 2005, a putative class action lawsuit was filed in federal
district court in Massachusetts against, among others, the Trustees of the Funds
and Columbia. The lawsuit alleges that defendants violated common law duties to
fund shareholders as well as sections of the Investment Company Act of 1940, by
failing to ensure that the Funds and other affiliated funds participated in
securities class action settlements for which the funds were eligible.
Specifically, plaintiffs allege that defendants failed to submit proof of claims
in connection with settlements of securities class action lawsuits filed against
companies in which the funds held positions.
In 2004, certain Columbia Funds, the Trustees of the Columbia Funds, advisers
and affiliated entities were named as defendants in certain purported
shareholder class and derivative actions(2) making claims, including claims
under the Investment Company and the Investment Advisers Acts of 1940 and state
law. The suits seek damages and allege, inter alia, that the fees and expenses
paid by the funds are excessive and that the advisers and their affiliates
inappropriately used fund assets to distribute the funds and for other improper
purpose. On March 2, 2005, the actions were consolidated in the Massachusetts
federal court as IN RE COLUMBIA ENTITIES LITIGATION. The plaintiffs filed a
consolidated amended complaint on June 9, 2005.
On March 21, 2005 purported class action plaintiffs filed suit in Massachusetts
state court alleging that the conduct, including market timing, entitles Class B
shareholders in certain Columbia funds to an exemption from contingent deferred
sales charges upon early redemption (the "CDSC Lawsuit"). The CDSC Lawsuit has
been removed to federal court in Massachusetts and the federal Judicial Panel
has conditionally ordered its transfer to the MDL.
- ---------------
(1) The derivative cases purportedly brought on behalf of the Columbia Funds in
the MDL have been consolidated under the lead case, Slaybe, et al. v.
Columbia Management Advisers, Inc. et al, No. 04-CV-1768 (D. Md. Sept. 29,
2004). The fund derivative plaintiffs allege that the funds were harmed by
market timing and late trading activity and seek, among other things,
removal of the trustees of the funds, removal of Columbia Management and
CFD, disgorgement of all management fees and monetary damages.
(2) Cohen, et al. v. FleetBoston Financial Corporation, et al., (D. Mass. Aug.
2, 2004); Osburn, et al. v. FleetBoston Financial Corporation, et al., (D.
Mass. Aug. 10, 2004); Slick er, et al. v. FleetBoston Financial Corporation,
et al., (D. Mass. Aug. 11, 2004); Simmonds, et al. v. FleetBoston Financial
Corporation, et al., (D. Mass. Sept. 8, 2004).
48
OTHER BUSINESS
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 Proposals. 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 Funds has previously received written
contrary instructions from the shareholder entitled to vote the shares.
OUTSTANDING SHARES AND SIGNIFICANT SHAREHOLDERS
The table in Appendix F lists for each Fund the total number of shares
outstanding as of the close of business on June 28, 2005, for each class of a
Fund's shares entitled to vote at the Meeting.
The table in Appendix G lists each holder of more than five percent of any class
of shares of each Fund as of the close of business on May 31, 2005. The Trustees
and officers of each Fund, in the aggregate, owned less than 1% of each Fund's
outstanding shares as of May 31, 2005.
INFORMATION ABOUT THE MEETING AND THE VOTING AND TABULATION OF PROXIES
All proxies solicited by or on behalf of the Board that are properly executed
and returned in time to be voted at the Meeting will be voted at the Meeting as
instructed on the proxy. If no instructions are given, the proxy will be voted
in favor of the Proposals.
Any proxy may be revoked at any time prior to its being exercised by written
notification received by the Funds' Secretary, by the execution of a later dated
proxy, or by attending the Meeting 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"). For each
Fund, 30% of the shares of the Fund outstanding on the Record Date and entitled
to vote, present at the Meeting in person or represented by proxy, constitutes a
quorum for the transaction of business by the shareholders of that Fund.
Approval of Proposal 1 is by a plurality of votes cast at the Meeting. Approval
of each of Proposals 2.A. through 2.M. requires the affirmative vote of a
"majority of the outstanding voting securities" of a Fund entitled to vote on
such Proposal. As defined by the 1940 Act, a "majority of the outstanding voting
securities" means the vote of (i) 67% or more of the
49
Fund's shares present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Fund are represented at the Meeting in person or by
proxy, or (ii) more than 50% of the Fund's outstanding shares, whichever is
less. Only shareholders of record on June 28, 2005, may vote.
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 Proposal 1,
withheld authority, abstentions and broker non-votes have no effect on the
outcome of voting. With respect to any other Proposals, withheld authority,
abstentions and broker non-votes have the effect of a vote "against" the
Proposal. "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
If a quorum is not present at the Meeting, the Meeting will be adjourned to
permit further solicitation of proxies. In the event that a quorum is present at
the Meeting but sufficient votes to approve any of the proposals have not been
received, the persons named as proxies may propose one or more adjournments of
the Meeting to permit further solicitation of proxies. A shareholder vote may be
taken on one or more of the proposals referred to above prior to such
adjournment if sufficient votes have been received and it is otherwise
appropriate. Any such adjournment will require the affirmative vote of a
majority of those shares voted at the Meeting (without regard to abstentions and
broker non-votes). If a quorum is present, the persons named as proxies will
vote those proxies that entitle them to vote for any such proposal in favor of
such adjournment and will vote those proxies that require them to vote for
rejection of any such proposal against any such adjournment.
SUBMISSION OF PROPOSALS FROM SHAREHOLDERS AT FUTURE MEETINGS
Your Fund does not regularly hold annual shareholder meetings, but may from time
to time schedule special meetings. In accordance with the regulations of the
SEC, in order to be eligible for inclusion in the Fund's proxy statement for
such a meeting, a shareholder proposal must be received a reasonable time before
the Fund prints and mails its proxy statement.
You may submit shareholder proposals c/o the Secretary of the Funds, One
Financial Center, Boston, Massachusetts 02111-2621.
50
OTHER INFORMATION
EACH FUND HAS PREVIOUSLY SENT ITS MOST RECENT ANNUAL REPORT AND SEMI-ANNUAL
REPORT FOR ANY SUBSEQUENT SEMI-ANNUAL PERIOD TO ITS SHAREHOLDERS. YOU MAY OBTAIN
A COPY OF THE REPORT, FREE OF CHARGE, BY WRITING TO COLUMBIA AT ONE FINANCIAL
CENTER, BOSTON, MASSACHUSETTS 02111-2621, OR BY CALLING 1-866-348-1468.
51
APPENDIX A -- OFFICER INFORMATION
The names and ages of the executive officers of the Funds, the year each was
first elected or appointed to office and their principal business occupations
during at least the last five years are shown below. The address of each officer
is One Financial Center, Boston, MA 02111-2621.
OFFICERS
<Table>
<Caption>
YEAR FIRST ELECTED
OR APPOINTED TO
NAME/AGE AND ADDRESS POSITION WITH FUNDS OFFICE PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
- ------------------------ ------------------------ ------------------ ----------------------------------------------------------
Christopher L. Wilson Head of Mutual Funds 2004 Head of Mutual Funds since August, 2004 and Senior Vice
(Age 47) since August 2004; President of the Advisor since January, 2005; President of
President of the the Columbia Funds, Liberty Funds and Stein Roe Funds
Columbia Funds since since October, 2004; President and Chief Executive Officer
October 2004 of the Nations Funds since January, 2005; Senior Vice
President of BACAP Distributors LLC since January, 2005;
Director of FIM Funding, Inc. since January, 2005; Senior
Vice President of Columbia Funds Distributor, Inc. since
January, 2005; Director of Columbia Funds Services, Inc.
since January, 2005 (formerly President and Chief
Executive Officer, CDC IXIS Asset Management Services,
Inc. from September, 1998 to August, 2004).
J. Kevin Connaughton Treasurer 2000 Treasurer of the Columbia Funds since October, 2003 and of
(Age 40) the Liberty Funds, Stein Roe Funds and All-Star Funds
since December, 2000; Vice President of the Advisor since
April, 2003 (formerly President of the Columbia Funds,
Liberty Funds and Stein Roe Funds from February, 2004 to
October, 2004; Chief Accounting Officer and Controller of
the Liberty Funds and All-Star Funds from February, 1998
to October, 2000); Treasurer of the Galaxy Funds since
September, 2002 (formerly Treasurer from December, 2002 to
December, 2004 and President from February, 2004 to
December, 2004 of the Columbia Management Multi-Strategy
Hedge Fund, LLC; Vice President of Colonial Management
Associates, Inc. from February, 1998 to October, 2000).
</Table>
A-1
<Table>
<Caption>
YEAR FIRST ELECTED
OR APPOINTED TO
NAME/AGE AND ADDRESS POSITION WITH FUNDS OFFICE PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
- ------------------------ ------------------------ ------------------ ----------------------------------------------------------
Mary Joan Hoene Senior Vice President 2004 Senior Vice President and Chief Compliance Officer of the
(Age 54) and Chief Compliance Columbia Funds, Liberty Funds, Stein Roe Funds and
40 West 57th Officer since 2004 All-Star Funds since August, 2004 (formerly Partner,
Street New York, NY Carter, Ledyard & Milburn LLP from January, 2001 to
10019 August, 2004; Counsel, Carter, Ledyard & Milburn LLP from
November, 1999 to December, 2000; Vice President and
Counsel, Equitable Life Assurance Society of the United
States from April, 1998 to November, 1999).
Michael G. Clarke Chief Accounting Officer 2004 Chief Accounting Officer of the Columbia Funds, Liberty
(Age 35) since October 2004 Funds, Stein Roe Funds and All-Star Funds since October,
2004 (formerly Controller of the Columbia Funds, Liberty
Funds, Stein Roe Funds and the All-Star Funds from May,
2004 to October, 2004); Assistant treasurer from June,
2002 to May, 2004; Vice President, Product Strategy &
Development of the Liberty Funds Group from February, 2001
to June, 2002; Assistant Treasurer of the Liberty Funds
Group from February, 2001 to June, 2002; Assistant
Treasurer of the Liberty Funds, Stein Roe Funds and the
All-Star Funds from August, 1999 to February, 2001; Audit
Manager, Deloitte & Touche LLP from May, 1997 to August,
1999.
Jeffrey R. Coleman Controller since October 2004 Controller of the Columbia Funds, Liberty Funds, Stein Roe
(Age 35) 2004 Funds and the All-Star Funds since October, 2004 (formerly
Vice President of CDC IXIS Asset Management Services, Inc.
and Deputy Treasurer of the CDC Nvest Funds and Loomis
Sayles Funds from February, 2003 to September, 2004;
Assistant Vice President of CDC IXIS Asset Management
Services, Inc. and Assistant Treasurer of the CDC Nvest
Funds from August, 2000 to February, 2003; Tax Manager of
PFPC, Inc. from November, 1996 to August, 2000).
R. Scott Henderson Secretary since December 2004 Secretary of the Columbia Funds, Liberty Funds and the
(Age 45) 2004 Stein Roe Funds since December, 2004 (formerly Of Counsel
Bingham McCutchen from April 2001 to September 2004;
Executive Director and General Counsel, Massachusetts
Pension Reserves Investment Management Board from
September, 1997 to March, 2001).
</Table>
A-2
APPENDIX B.1 -- TRUSTEES' COMPENSATION
For the calendar year ended December 31, 2004, the Trustees received the
following compensation for serving as Trustees:
<Table>
<Caption>
TOTAL COMPENSATION FROM THE
FUND COMPLEX PAID TO THE
PENSION OR RETIREMENT TRUSTEES FOR THE
BENEFITS ACCRUED AS PART CALENDAR YEAR ENDED
DISINTERESTED TRUSTEES OF FUND EXPENSES(1) DECEMBER 31, 2004
- ---------------------- ------------------------ ---------------------------
Douglas A. Hacker N/A $135,000
Janet Langford Kelly N/A $148,500
Richard W. Lowry N/A $150,700
Charles R. Nelson N/A $141,500
John J. Neuhauser N/A $158,284
Patrick J. Simpson(2) N/A $129,000
Thomas E. Stitzel N/A $149,000
Thomas C. Theobald(2) N/A $172,500
Anne-Lee Verville(2) N/A $157,000
Richard L. Woolworth N/A $131,000
INTERESTED TRUSTEE
- -----------------------
William E. Mayer N/A $166,700
</Table>
(1) The Funds do not currently provide pension or retirement plan benefits to
the Trustees.
(2) During the calendar year ended December 31, 2004, Mr. Simpson deferred
$129,000 of his total compensation pursuant to the deferred compensation
plan, Mr. Theobald deferred $90,000 of his total compensation pursuant to
the deferred compensation plan and Ms. Verville deferred $55,000 of her
total compensation pursuant to the deferred compensation plan.
B-1
APPENDIX B.2 -- TRUSTEES' COMPENSATION
For purposes of Appendix B.2, the following definitions apply:
<Table>
Columbia High Yield Columbia Connecticut Columbia Newport Tiger
Opportunity Fund Intermediate Municipal Fund ("NTF")
("HYOF") Bond Fund ("CIMBF")
Columbia Strategic Columbia Connecticut Columbia Income Fund
Income Fund ("SIF") Tax-Exempt Fund ("IF")
("CCTEF")
Columbia Tax-Managed Columbia Florida Columbia Intermediate
Growth Fund ("TMGF") Intermediate Municipal Bond Fund ("IBF")
Bond Fund ("FIMBF")
Columbia Tax-Managed Columbia Intermediate Columbia High Yield
Value Fund ("TMVF") Tax-Exempt Bond Fund Municipal Fund
("ITEBF") ("HYMF")
Columbia Federal Columbia Large Company Columbia Managed
Securities Fund Index Fund ("LCIF") Municipals Fund
("FSF") ("MMF")
Columbia Global Equity Columbia Massachusetts Columbia Asset
Fund ("GEF") Intermediate Municipal Allocation Fund
Bond Fund ("MIMBF") ("AAF")
Columbia Intermediate Columbia Massachusetts Columbia Dividend
Government Income Fund Tax-Exempt Fund Income Fund ("DIF")
("IGIF") ("MTEF")
Columbia Liberty Fund Columbia New Jersey Columbia Disciplined
("LF") Intermediate Municipal Value Fund ("DVF")
Bond Fund ("NJIMBF")
Columbia Mid Cap Value Columbia New York Columbia Growth Stock
Fund ("MCVF") Intermediate Municipal Fund ("GSF")
Bond Fund ("NYIMBF")
Columbia Quality Plus Columbia New York Columbia Large Cap
Bond Fund ("QPBF") Tax-Exempt Fund Core Fund ("LCCF")
("NYTEF")
Columbia Municipal Columbia Rhode Island Columbia Large Cap
Money Market Fund Intermediate Municipal Growth Fund ("LCGF")
("MMMF") Bond Fund ("RIIMBF")
Columbia Tax-Exempt Columbia Small Company Columbia Small Company
Fund ("TEF") Index Fund ("SCIF") Equity Fund ("SCEF")
Columbia Tax-Exempt Columbia U.S. Treasury Columbia Small Cap
Insured Fund ("TEIF") Index Fund ("USTIF") Fund ("SCF")
Columbia Utilities Columbia Growth & Columbia Young
Fund ("UF") Income Fund ("GIF") Investor Fund ("YIF")
Columbia California Columbia Small Cap
Tax-Exempt Fund Value Fund ("SCVF")
("CTEF")
</Table>
B-2
For the last fiscal year, the Trustees received from each Fund the following
compensation for serving as Trustees:
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM HYOF FROM SIF FROM FSF FROM QPBF FROM IGIF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 5/31/05 5/31/05 8/31/04 4/30/05 4/30/04
- ------- -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $1,685 $2,955 3,132 $2,062 $1,153
Janet Langford Kelly 1,937 3,415 3,140 2,337 1,305
Richard W. Lowry 1,544 2,722 2,941 1,876 1,049
William E. Mayer 1,787 3146 3,232 2,158 1,208
Charles R. Nelson 1,792 3,156 3,121 2,149 1,202
John J. Neuhauser 1,619 2,848 3,115 1,955 1,094
Patrick J. Simpson(a) 1,612 2,839 2,497 1,939 1,085
Thomas E. Stitzel 1,816 3,187 3,342 2,201 1,231
Thomas C. Theobald(b) 2,201 3,864 3,788 2,706 1,509
Anne-Lee Verville(c) 1,939 3,399 3,691 2,355 1,317
Richard L. Woolworth 1,546 2,713 2,732 1,887 1,055
</Table>
(a) During the fiscal year ended May 31, 2005, Mr. Simpson deferred $1,612 and
$2,839 of his compensation from HYOF and SIF, respectively. During the
fiscal year ended August 31, 2004, Mr. Simpson deferred $2,497 of his
compensation from FSF. During the fiscal year ended April 30, 2005, Mr.
Simpson deferred $1,939 of his compensation from QPBF and $1,085 from IGIF.
(b) During the fiscal year ended May 31, 2005, Mr. Theobald deferred $1,287 and
$2,233 of his compensation from HYOF and the SIF, respectively. During the
fiscal year ended August 31, 2004, Mr. Theobald deferred $1,845 of his
compensation from FSF. During the fiscal year ended April 30, 2005, Mr.
Theobald deferred $1,622 of his compensation from QPBF and $901 from IGIF.
(c) During the fiscal year ended May 31, 2005, Ms. Verville deferred $400 and
$665 of her compensation from HYOF and SIF, respectively. During the fiscal
year ended August 31, 2004, Ms. Verville deferred $1,320 of her compensation
from FSF. During the fiscal year ended April 30, 2005, Ms. Verville deferred
$478 of her compensation from QPBF and $277 from IGIF.
B-3
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM TMGF FROM TMVF FROM LF FROM MCVF FROM TEF FROM TEIF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 10/31/04 10/31/04 9/30/04) 9/30/04 11/30/04 11/30/04
- ------- -------------- -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $ 988 $566 $2,959 $3,375 $3,705 $745
Janet Langford Kelly 1,044 597 3,009 3,485 3,956 794
Richard W. Lowry 927 536 2,845 3,145 3,457 703
William E. Mayer 1,032 600 3,125 3,463 3,918 794
Charles R. Nelson 1,023 588 3,008 3,463 3,866 781
John J. Neuhauser 969 560 2,965 3,347 3,664 744
Patrick J. Simpson(a) 947 548 2,485 2,682 3,529 720
Thomas E. Stitzel 1,043 607 3,052 3,461 3,917 805
Thomas C. Theobald(b) 1,291 725 4,137 4,122 4,934 962
Anne-Lee Verville(c) 1,155 666 3,503 3,927 4,322 875
Richard L. Woolworth 931 547 2,504 2,646 3,446 716
<Caption>
AGGREGATE
COMPENSATION
FROM UF
FOR THE FISCAL
YEAR ENDED
TRUSTEE 11/30/04
- ------- --------------
Douglas A. Hacker $2,236
Janet Langford Kelly 2,364
Richard W. Lowry 2,215
William E. Mayer 2,464
Charles R. Nelson 2,383
John J. Neuhauser 2,322
Patrick J. Simpson(a) 2,282
Thomas E. Stitzel 2,602
Thomas C. Theobald(b) 2,640
Anne-Lee Verville(c) 2,718
Richard L. Woolworth 2,415
</Table>
(a) During the fiscal year ended October 31, 2004, Mr. Simpson deferred $947 of
his compensation from TMGF and $548 of his compensation from TMVF. During
the fiscal year ended September 30, 2004, Mr. Simpson deferred $2,682 of his
compensation from MCVF and $2,485 of his compensation from LF. During the
fiscal year ended November 30, 2004, Mr. Simpson deferred $3,529 of his
compensation from TEF and $720 of his compensation from TEIF. During the
fiscal year ended November 30, 2004, Mr. Simpson deferred $2,282 of his
compensation from UF.
(b) During the fiscal year ended October 31, 2004, Mr. Theobald deferred $745
his compensation from TMGF and $387 of his compensation from TMVF. During
the fiscal year ended September 30, 2004, Mr. Theobald deferred $2,278 of
his compensation from MCVF and $2,839 of his compensation from LF. During
the fiscal year ended November 30, 2004, Mr. Theobald deferred $3,018 of his
compensation from TEF and $529 of his compensation from TEIF. During the
fiscal year ended November 30, 2004, Mr. Theobald deferred $869 of his
compensation from UF.
(c) During the fiscal year ended October 31, 2004, Ms. Verville deferred $455 of
her compensation from TMGF and $236 of her compensation from TMVF. During
the fiscal year ended September 30, 2004, Ms. Verville deferred $1,602 of
her compensation from MCVF and $1,895 compensation from LF. During the
fiscal year ended November 30, 2004, Ms. Verville deferred $1,844 of her
compensation from the TEF and $323 from the TEIF. During the fiscal year
ended November 30, 2004, Ms. Verville deferred $531 of her compensation from
UF.
B-4
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM CTEF FROM CCTEF FROM MTEF FROM NYTEF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 10/31/04 10/31/04 10/31/04 10/31/04
- ------- -------------- -------------- -------------- --------------
Douglas A. Hacker $1,029 $1,535 $ 885 $753
Janet Langford Kelly 1,136 1,591 930 818
Richard W. Lowry 993 1,505 839 748
William E. Mayer 1,120 1,665 938 834
Charles R. Nelson 1,110 1,606 917 812
John J. Neuhauser 1,039 1,568 877 809
Patrick J. Simpson(a) 1,017 1,551 859 795
Thomas E. Stitzel 1,127 1,760 952 885
Thomas C. Theobald(b) 1,344 1,777 1,128 993
Anne-Lee Verville(c) 1,240 1,844 1,041 956
Richard L. Woolworth 989 1,647 861 811
</Table>
(a) During the fiscal year ended October 31, 2004, Mr. Simpson deferred $1,017
of his compensation from CTEF, $1,551 from CCTEF, $859 from MTEF and $795
from NYTEF.
(b) During the fiscal year ended October 31, 2004, Mr. Theobald deferred $724 of
his compensation from CTEF, $555 from CCTEF, $591 from MTEF and $447 from
NYTEF.
(c) During the fiscal year ended October 31, 2004, Ms. Verville deferred $443 of
her compensation from CTEF, $339 from CCTEF, $361 from MTEF and $273 from
NYTEF.
B-5
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM CIMBF FROM FIMBF FROM THE MIMBF FROM NJIMBF FROM NYIMBF FROM RIIMBF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 10/31/04 10/31/04 10/31/04 10/31/04 10/31/04 10/31/04
- ------- -------------- -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $ 794 $ 0 $1,106 $607 $674 $1,053
Janet Langford Kelly 837 784 1,164 639 710 1,095
Richard W. Lowry 748 725 1,038 576 639 1,023
William E. Mayer 838 806 1,163 644 715 1,135
Charles R. Nelson 822 783 1,142 631 700 1,098
John J. Neuhauser 782 757 1,086 602 668 1,066
Patrick J. Simpson(a) 765 745 1,061 590 654 1,052
Thomas E. Stitzel 844 837 1,168 655 726 1,186
Thomas C. Theobald(b) 1,029 909 1,446 771 858 1,253
Anne-Lee Verville(c) 930 893 1,293 715 793 1,257
Richard L. Woolworth 757 771 1,047 708 654 1,100
<Caption>
AGGREGATE
COMPENSATION
FROM ITEBF
FOR THE FISCAL
YEAR ENDED
TRUSTEE 10/31/04
- ------- --------------
Douglas A. Hacker $2,201
Janet Langford Kelly 1,631
Richard W. Lowry 1,462
William E. Mayer 1,636
Charles R. Nelson 1,604
John J. Neuhauser 1,528
Patrick J. Simpson(a) 1,496
Thomas E. Stitzel 1,653
Thomas C. Theobald(b) 1,997
Anne-Lee Verville(c) 1,818
Richard L. Woolworth 1,488
</Table>
(a) During the fiscal year ended October 31, 2004, Mr. Simpson deferred $,765,
$745, $1,061, $590, $654, $1,052, and $1,496 of his compensation from the
CIMBF, FIMBF, MIMBF, NJIMBF, NYIMBF, RIIMBF and ITEBF, respectively.
(b) During the fiscal year ended October 31, 2004, Mr. Theobald deferred $57455,
$376, $833, $400, $449, $471, and $1,094 of his compensation from CIMBF,
FIMBF, MIMBF, NJIMBF, NYIMBF, RIIMBF and ITEBF, respectively.
(c) During the fiscal year ended October 31, 2004, Ms. Verville deferred $351,
$230, $509, $244, $274, $288 and $668 of her compensation from CIMBF, FIMBF,
MIMBF, NJIMBF, NYIMBF, RIIMBF and ITEBF, respectively.
B-6
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM SCVF FROM GIF FROM NTF FROM HYMF FROM MMF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 06/30/04 07/30/04 08/30/04 06/30/04 06/30/04
- ------- -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $1,273 $3,956 $1,181 $1,551 $1,448
Janet Langford Kelly 1,149 3,873 1,178 1,437 1,297
Richard W. Lowry 1,139 3,589 1,099 1,427 1,284
Salvatore Macera(a) 51 0 N/A 49 66
William E. Mayer 1,257 3,948 1,202 1,573 1,420
Charles R. Nelson 1,232 3,824 1,167 1,527 1,515
John J. Neuhauser 1,320 3,891 1,154 1,611 1,503
Patrick J. Simpson(b) 677 2,448 928 994 690
Thomas Stitzel 1,221 3,870 1,240 1,560 1,351
Thomas C. Theobald(c) 1,373 4,969 1,442 1,722 1,856
Anne-Lee Verville(d) 1,482 4,566 1,383 1,825 1,686
Richard L. Woolworth 731 2,599 1,013 1,080 733
</Table>
(a) Mr. Macera retired as a Trustee from the Board of Trustees effective June
18, 2003.
(b) During the fiscal year ended June 30, 2004, Mr. Simpson deferred $677 of his
compensation from SCVF. During the fiscal year ended July 31, 2004, Mr.
Simpson deferred $2,448 of his compensation from GIF. During the fiscal year
ended August 31, 2004, Mr. Simpson deferred $928 of his compensation from
NTF. During the fiscal year ended June 30, 2004, Mr. Simpson deferred $994
and $690 of his compensation from HYMF and MMF, respectively.
(c) During the fiscal year ended June 30, 2004, Mr. Theobald deferred $640 of
his compensation from SCVF. During the fiscal year ended July 31, 2004, Mr.
Theobald deferred $2,886 of his compensation from GIF. During the fiscal
year ended August 31, 2004, Mr. Theobald deferred $778 of his compensation
from NTF. During the fiscal year ended June 30, 2004, Mr. Theobald deferred
$752 and $888 of his compensation from HYMF and MMF, respectively.
(d) During the fiscal year ended June 30, 2004, Ms. Verville deferred $552 of
her compensation from SCVF. During the fiscal year ended July 31, 2004, Ms.
Verville deferred $2,061 of her compensation from GIF. During fiscal year
ended August 31, 2004, Ms. Verville deferred $558 of her compensation from
NTF. During the fiscal year ended June 30, 2004, Ms. Verville deferred $612
and $612 of her compensation from HYMF and MMF, respectively.
B-7
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM AAF FROM LCGF FROM DVF FROM LCCF FROM SCF FROM SCEF
FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 09/30/04 09/30/04 09/30/04 09/30/04 09/30/04 09/30/04
- ------- -------------- -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $1,332 $2,243 $1,458 $1,392 $2,562 $1,304
Janet Langford Kelly 1,346 2,274 1,483 1,409 2,676 1,326
Richard W. Lowry 1,230 2,051 1,394 1,303 2,341 1,232
William E. Mayer 1,356 2,272 1,515 1,431 2,605 1,344
Charles R. Nelson 1,344 2,267 1,484 1,281 2,653 1,323
John J. Neuhauser 1,316 2,211 1,450 1,383 2,521 1,291
Patrick J. Simpson(a) 1,103 1,922 1,073 1,144 2,188 979
Thomas E. Stitzel 1,364 2,293 1,517 1,448 2,646 1,341
Thomas C. Theobald(b) 1,612 2,731 1,717 1,658 3,077 1,562
Anne-Lee Verville(c) 1,533 2,575 1,705 1,614 2,966 1,516
Richard L. Woolworth 1,109 1,924 1,088 1,163 2,145 982
<Caption>
AGGREGATE
COMPENSATION
FROM DIF
FOR THE FISCAL
YEAR ENDED
TRUSTEE 09/30/04
- ------- --------------
Douglas A. Hacker $1,013
Janet Langford Kelly 1,027
Richard W. Lowry 965
William E. Mayer 1,055
Charles R. Nelson 1,032
John J. Neuhauser 1,014
Patrick J. Simpson(a) 823
Thomas E. Stitzel 1,074
Thomas C. Theobald(b) 1,180
Anne-Lee Verville(c) 1,185
Richard L. Woolworth 849
</Table>
(a) During the fiscal year ended September 30, 2004, Mr. Simpson deferred
$1,103, $1,922, $1,073, $1,144, $2,188, $979, $823 from AAF, LCGF, DVF,
LCCF, SCF and SCEF, respectively.
(b) During the fiscal year ended September 30, 2004, Mr. Theobald deferred $824,
$1,377, $921, $812, $1,566, $872, $542 from AAF, LCGF, DVF, LCCF, SCF and
SCEF, respectively.
(c) During the fiscal year ended September 30, 2004, Ms. Verville deferred $555,
$889, $716, $567, $1,035, $654, $398 from AAF, LCGF, DVF, LCCF, SCF and
SCEF, respectively.
B-8
<Table>
<Caption>
AGGREGATE AGGREGATE
COMPENSATION COMPENSATION
FROM GSF FROM YIF
FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED
TRUSTEE 09/30/04 09/30/04
- ------- -------------- --------------
Douglas A. Hacker $2,404 $1,951
Janet Langford Kelly 2,432 1,981
Richard W. Lowry 2,266 1,810
William E. Mayer 2,482 1,982
Charles R. Nelson 2,437 1,977
John J. Neuhauser 2,393 1,927
Patrick J. Simpson(a) 1,948 1,506
Thomas Stitzel 2,510 2,008
Thomas C. Theobald(b) 2,853 2,205
Anne-Lee Verville(c) 2,796 2,245
Richard L. Woolworth 1,990 1,514
</Table>
(a) During the fiscal year ended September 30, 2004, Mr. Simpson deferred $1,948
of his compensation from GSF and $1,506 of his compensation from YIF.
(b) During the fiscal year ended September 30, 2004, Mr. Theobald deferred
$1,404 of his compensation from GSF and $1,004 of his compensation from YIF.
(c) During the fiscal year ended September 30, 2004, Ms. Verville deferred
$1,004 of her compensation from GSF and $750 of her compensation from YIF.
B-9
<Table>
<Caption>
AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE AGGREGATE
COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION COMPENSATION
FROM GEF FOR FROM MMMF FROM LCIF FROM USTIF FROM SCIF FROM IF
THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL FOR THE FISCAL
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
TRUSTEE 03/31/05 03/31/05 03/31/05 03/31/05 03/31/05 03/31/05
- ------- ------------ -------------- -------------- -------------- -------------- --------------
Douglas A. Hacker $626 $1,008 $1,965 $ 907 $ 939 $1,403
Janet Langford Kelly 678 997 2,228 958 1,053 1,576
Richard W. Lowry 563 886 1,796 813 855 1,279
William E. Mayer 652 1,036 2,067 943 985 1,473
Charles R. Nelson 644 988 2,070 920 983 1,469
John J. Neuhauser 596 942 1,892 860 902 1,348
Patrick J. Simpson(a) 586 933 1,857 848 689 1,324
Thomas E. Stitzel 678 1,083 2,132 979 784 1,522
Thomas C. Theobald(b) 760 1,100 2,569 1,086 1,212 1,818
Anne-Lee Verville(c) 709 1,118 2,255 1,023 1,074 1,607
Richard L. Woolworth 593 1,000 1,813 871 872 1,304
<Caption>
AGGREGATE
COMPENSATION
FROM IBF
FOR THE FISCAL
YEAR ENDED
TRUSTEE 03/31/05
- ------- --------------
Douglas A. Hacker $2,291
Janet Langford Kelly 2,609
Richard W. Lowry 2,096
William E. Mayer 2,411
Charles R. Nelson 2,418
John J. Neuhauser 2,208
Patrick J. Simpson(a) 2,166
Thomas E. Stitzel 2,487
Thomas C. Theobald(b) 3,013
Anne-Lee Verville(c) 2,632
Richard L. Woolworth 2,110
</Table>
(a) During the fiscal year ended March 31, 2005, Mr. Simpson deferred $586 of
his compensation from GEF, $933 from MMMF, $1,857 from LCIF, $848 from
USTIF, $885 from SCIF, $1,324 from IF, and $2,166 from IBF.
(b) During the fiscal year ended March 31, 2005, Mr. Theobald deferred $385 of
his compensation from GEF, $419 from MMMF, $1,511 from LCIF, $534 from
USTIF, $698 from SCIF, $1,052 from IF, and $1,789 from IBF.
(c) During the fiscal year ended March 31, 2005, Ms. Verville deferred $169 of
her compensation from GEF, $192 from MMMF, $676 from LCIF, $242 from USTIF,
$312 from SCIF, $468 from IF, and $797 from IBF.
B-10
APPENDIX C -- TRUSTEE SHARE OWNERSHIP
<Table>
<Caption>
AGGREGATE DOLLAR
RANGE OF EQUITY
SECURITIES OWNED IN
DOLLAR RANGE OF ALL FUNDS OVERSEEN BY
EQUITY SECURITIES OWNED TRUSTEE/DIRECTOR IN
NAME FUND IN THE FUND THE FUND COMPLEX
- ---- -------------------------------------- ----------------------- ---------------------
Douglas A. Hacker Columbia Young Investor Fund $50,001-$100,000 Over $100,000
Columbia Mid Cap Value Fund Over $100,000
Columbia Growth & Income Fund $10,001-$50,000
Janet Langford Kelly Columbia Young Investor Fund Over $100,000 Over $100,000
Columbia Growth & Income Fund Over $100,000
Richard W. Lowry Columbia Global Equity Fund $10,001-$50,000 Over $100,000
William E. Mayer None $0 $50,001-$100,000
Charles R. Nelson Columbia Income Fund $50,001-$100,000 Over $100,000
Columbia Mid Cap Value Fund $10,001-$50,000
Columbia Asset Allocation Fund $50,001-$100,000
Columbia Growth Stock Fund $50,001-$100,000
Columbia Intermediate Bond Fund Over $100,000
Columbia Growth & Income Fund $50,001-$100,000
John J. Neuhauser Columbia Liberty Fund Over $100,000 Over $100,000
Columbia Young Investor Fund $1-$10,000
Columbia High Yield Opportunity Fund $1-$10,000
Columbia Growth & Income Fund $1-$10,000
Columbia Small Cap Value Fund $10,001-$50,000
Columbia Massachusetts Tax-Exempt Fund $50,001-$100,000
Columbia Mid Cap Value Fund $1-$10,000
Columbia Utilities Fund $1-$10,000
</Table>
C-1
<Table>
<Caption>
AGGREGATE DOLLAR
RANGE OF EQUITY
SECURITIES OWNED IN
DOLLAR RANGE OF ALL FUNDS OVERSEEN BY
EQUITY SECURITIES OWNED TRUSTEE/DIRECTOR IN
NAME FUND IN THE FUND THE FUND COMPLEX
- ---- -------------------------------------- ----------------------- ---------------------
Patrick J. Simpson None $0 Over $100,000
Thomas E. Stitzel Columbia Newport Tiger Fund $50,001-$100,000 Over $100,000
Thomas C. Theobald Columbia High Yield Municipal Fund $10,001-$50,000 Over $100,000
Columbia Growth Stock Fund $10,001-$50,000
Columbia Disciplined Value Fund $10,001-$50,000
Anne-Lee Verville None $0 Over $100,000
Richard W. Woolworth None $0 Over $100,000
</Table>
C-2
APPENDIX D
GOVERNANCE COMMITTEE CHARTER
The Governance Committee (the "Committee") of the Funds shall be composed
entirely of members of the Board of the Funds who are not affiliated with the
Funds' investment adviser, sub-advisers or principal underwriter.
The functions of the Committee are:
To make nominations for independent trustee membership on the Board of Trustees
when necessary and to consider candidates proposed for the Board of Trustees by
shareholders of the Funds;
To review periodically Board governance practices and procedures and any
recommendations of the Chief Compliance Officer of the Funds relating thereto,
and to recommend to the Board any changes it may deem appropriate;
To review periodically trustee compensation and to recommend to the independent
trustees any changes it may deem appropriate;
To review committee assignments on an annual basis;
To review on an annual basis the responsibilities and charter of each committee
of the Board, whether there is continuing need for each committee, whether there
is a need for additional committees of the Board, and whether committees should
be combined or reorganized, and to make recommendations for any such action to
the Board;
To plan and administer the Board's annual self-evaluation process;
To evaluate on at least an annual basis the independence of counsel to the
independent trustees, to make recommendations to the independent trustees
regarding their determination of such counsel's status as an "independent legal
counsel" under applicable SEC rules, and to supervise such counsel.
The Committee shall meet as frequently and at such times as circumstances
dictate. Minutes shall be kept of the Committee's meetings.
The Committee shall have the resources and authority appropriate to discharge
its responsibilities, including authority to retain special counsel and other
experts or consultants at the expense of the appropriate Fund.
The Committee shall review this charter at least annually and recommend to the
Board any changes it deems appropriate.
D-1
APPENDIX E1
<Table>
<Caption>
AUDIT- ALL
AUDIT RELATED TAX OTHER
FUND NAME FYE FEES FEES FEES FEES TOTAL
--------- -------- ------ ------- ----- ----- ------
Columbia High Yield Opportunity Fund 5/31/04 37,520 4,000 2,612 -- 44,132
5/31/03 39,930 -- 4,585 -- 44,515
Columbia Strategic Income Fund 5/31/04 39,560 4,000 4,612 -- 48,172
5/31/03 42,020 -- 3,085 -- 45,105
Columbia Tax-Managed Growth Fund 10/31/04 20,390 3,500 2,300 -- 26,190
10/31/03 21,850 4,000 2,100 -- 27,950
Columbia Tax-Managed Value Fund 10/31/04 16,830 3,500 2,300 -- 22,630
10/31/03 17,990 4,000 2,100 -- 24,090
Columbia Global Equity Fund 3/31/05 22,500 3,700 2,454 -- 28,654
3/31/04 10,715 4,000 2,412 -- 17,127
Columbia Intermediate Government
Income Fund 4/30/05 24,440 3,700 2,654 -- 30,794
4/30/04 23,280 4,000 2,541 -- 29,821
Columbia Quality Plus Bond Fund 4/30/05 33,390 8,950 4,454 -- 46,794
4/30/04 26,260 4,000 5,241 -- 35,501
Columbia Federal Securities Fund 8/31/04 38,200 3,500 4,912 -- 46,612
8/31/03 40,590 4,000 2,900 -- 47,490
Columbia Mid Cap Value Fund 9/30/04 24,900 3,500 2,300 -- 30,700
9/30/03 25,330 4,000 2,200 -- 31,530
Columbia Liberty Fund+ 9/30/04 35,590 3,500 2,512 -- 41,602
9/30/03 31,000 4,000 2,987 -- 37,987
Columbia Municipal Money Market Fund 3/31/05 21,480 3,700 1,554 -- 26,734
3/31/04 20,460 4,000 1,412 -- 25,872
Columbia Tax-Exempt Fund 11/30/04 39,550 3,700 3,410 -- 46,660
11/30/03 42,020 4,000 3,512 -- 49,532
Columbia Tax-Exempt Insured Fund 11/30/04 26,250 3,700 5,010 -- 34,960
11/30/03 28,020 4,000 5,083 -- 37,103
Columbia Utilities Fund 11/30/04 26,830 3,700 2,410 -- 32,940
11/30/03 28,840 4,000 2,300 -- 35,140
Columbia Large Company Index Fund 3/31/05 21,890 3,700 4,154 -- 29,744
3/31/04 20,850 4,000 5,332 -- 30,182
Columbia U.S. Treasury Index Fund 3/31/05 21,890 3,700 3,654 -- 29,244
3/31/04 20,850 4,000 3,854 -- 28,704
Columbia Small Company Index Fund 3/31/05 21,890 3,700 4,154 -- 29,744
3/31/04 20,850 4,000 2,632 -- 27,482
Columbia Intermediate Tax-Exempt
Bond Fund+ 10/31/04 24,440 3,500 2,000 -- 29,940
10/31/03 23,000 4,000 2,383 -- 29,383
Columbia Massachusetts Intermediate
Municipal Bond Fund+ 10/31/04 23,390 3,500 2,000 -- 28,890
10/31/03 23,000 4,000 2,678 -- 29,678
Columbia Connecticut Intermediate
Municipal Bond Fund+ 10/31/04 23,390 3,500 2,000 -- 28,890
10/31/03 23,000 4,000 2,678 -- 29,678
</Table>
E-1
<Table>
<Caption>
AUDIT- ALL
AUDIT RELATED TAX OTHER
FUND NAME FYE FEES FEES FEES FEES TOTAL
--------- -------- ------ ------- ----- ----- ------
Columbia New Jersey Intermediate
Municipal Bond Fund+ 10/31/04 19,720 3,500 2,000 -- 25,220
10/31/03 23,000 4,000 3,278 -- 30,278
Columbia New York Intermediate
Municipal Bond Fund+ 10/31/04 19,720 3,500 2,000 -- 25,220
10/31/03 23,000 4,000 2,678 -- 29,678
Columbia Rhode Island Intermediate
Municipal Bond Fund+ 10/31/04 19,720 3,500 2,000 -- 25,220
10/31/03 23,000 4,000 3,278 -- 30,278
Columbia Florida Intermediate
Municipal Bond Fund+ 10/31/04 21,330 3,500 2,000 -- 26,830
10/31/03 21,000 4,000 2,383 -- 27,383
Columbia California Tax-Exempt Fund+ 10/31/04 21,730 3,500 2,000 -- 27,230
10/31/03 23,000 4,000 3,082 -- 30,082
Columbia Connecticut Tax-Exempt
Fund+ 10/31/04 21,730 3,500 2,000 -- 27,230
10/31/03 23,000 4,000 3,082 -- 30,082
Columbia Massachusetts Tax-Exempt
Fund+ 10/31/04 21,730 3,500 2,000 -- 27,230
10/31/03 23,000 4,000 3,011 -- 30,011
Columbia New York Tax-Exempt Fund 10/31/04 22,110 3,500 3,000 -- 28,610
10/31/03 23,530 4,000 2,500 -- 30,030
Columbia Small Cap Value Fund 6/30/04 22,830 4,000 4,862 -- 31,692
6/30/03 24,470 11,500 4,650 -- 40,620
Columbia Growth & Income Fund++ 7/31/04 30,030 4,000 2,441 -- 36,471
7/31/03 47,985 6,000 4,600 -- 58,585
Columbia Newport Tiger Fund 8/31/04 26,350 3,500 6,162 -- 36,012
8/31/03 28,390 4,000 9,966 -- 42,356
Columbia Income Fund 3/31/05 27,130 3,700 2,654 -- 33,484
3/31/04 25,840 4,000 2,512 -- 32,352
Columbia Intermediate Bond Fund 3/31/05 27,130 3,700 4,454 -- 35,284
3/31/04 25,840 4,000 2,512 -- 32,352
Columbia High Yield Municipal Fund+ 6/30/04 26,470 4,000 2,400 -- 32,870
6/30/03 28,500 9,500 5,100 -- 43,100
Columbia Managed Municipals Fund+ 6/30/04 26,290 4,000 4,700 -- 34,990
6/30/03 23,000 9,500 4,700 -- 37,200
Columbia Growth Stock Fund 9/30/04 21,540 3,500 2,412 -- 27,452
9/30/03 23,130 4,000 4,100 -- 31,230
Columbia Young Investor Fund 9/30/04 23,630 3,500 5,941 -- 33,071
9/30/03 26,590 4,000 4,100 -- 34,690
Columbia Dividend Income Fund+ 9/30/04 21,270 3,500 2,000 -- 26,770
9/30/03 21,000 4,000 2,520 -- 27,520
Columbia Asset Allocation Fund+ 9/30/04 27,560 3,500 2,000 -- 33,060
9/30/03 29,000 4,000 2,520 -- 35,520
Columbia Large Cap Core Fund+ 9/30/04 22,310 3,500 2,000 -- 27,810
9/30/03 21,000 4,000 2,520 -- 27,520
</Table>
E-2
<Table>
<Caption>
AUDIT- ALL
AUDIT RELATED TAX OTHER
FUND NAME FYE FEES FEES FEES FEES TOTAL
--------- -------- ------ ------- ----- ----- ------
Columbia Large Cap Growth Fund+ 9/30/04 21,260 3,500 2,000 -- 26,760
9/30/03 21,000 4,000 2,520 -- 27,520
Columbia Disciplined Value Fund+ 9/30/04 20,220 3,500 2,000 -- 25,720
9/30/03 21,000 4,000 2,520 -- 27,520
Columbia Small Company Equity Fund+ 9/30/04 21,270 3,500 2,000 -- 26,770
9/30/03 21,000 4,000 2,520 -- 27,520
Columbia Small Cap Fund+ 9/30/04 22,310 3,500 4,700 -- 30,510
9/30/03 21,000 4,000 2,520 -- 27,520
</Table>
+ Effective March 1, 2004, PwC replaced E&Y as auditors.
++ Fund changed fiscal year end from 6/30/03 to 7/31/03. Figures for Audit fees,
Audit-related fees and Tax fees include $31,990, $6,000 and $2,300,
respectively, for June 30, 2003.
E-3
APPENDIX E2
<Table>
<Caption>
NON-AUDIT
FUND NAME FYE SERVICES
- --------- -------- ---------
Columbia High Yield Opportunity Fund 5/31/04 6,612
5/31/03 4,585
Columbia Strategic Income Fund 5/31/04 8,612
5/31/03 3,085
Columbia Tax-Managed Growth Fund 10/31/04 5,800
10/31/03 6,100
Columbia Tax-Managed Value Fund 10/31/04 5,800
10/31/03 6,100
Columbia Global Equity Fund 3/31/05 6,154
3/31/04 6,412
Columbia Intermediate Government Income Fund 4/30/05 6,354
4/30/04 6,541
Columbia Quality Plus Bond Fund 4/30/05 13,404
4/30/04 9,241
Columbia Federal Securities Fund 8/31/04 8,412
8/31/03 6,900
Columbia Mid Cap Value Fund 9/30/04 5,800
9/30/03 6,200
Columbia Liberty Fund+ 9/30/04 6,012
9/30/03 6,987
Columbia Municipal Money Market Fund 3/31/05 5,254
3/31/04 5,412
Columbia Tax-Exempt Fund 11/30/04 7,110
11/30/03 7,512
Columbia Tax-Exempt Insured Fund 11/30/04 8,710
11/30/03 9,083
Columbia Utilities Fund 11/30/04 6,110
11/30/03 6,300
Columbia Large Company Index Fund 3/31/05 7,854
3/31/04 9,332
Columbia U.S. Treasury Index Fund 3/31/05 7,354
3/31/04 7,854
Columbia Small Company Index Fund 3/31/05 7,854
3/31/04 6,632
Columbia Intermediate Tax-Exempt Bond Fund+ 10/31/04 5,500
10/31/03 6,383
Columbia Massachusetts Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 6,678
</Table>
E-4
<Table>
<Caption>
NON-AUDIT
FUND NAME FYE SERVICES
- --------- -------- ---------
Columbia Connecticut Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 6,678
Columbia New Jersey Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 7,278
Columbia New York Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 6,678
Columbia Rhode Island Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 7,278
Columbia Florida Intermediate Municipal Bond Fund+ 10/31/04 5,500
10/31/03 6,383
Columbia California Tax-Exempt Fund+ 10/31/04 5,500
10/31/03 7,082
Columbia Connecticut Tax-Exempt Fund+ 10/31/04 5,500
10/31/03 7,082
Columbia Massachusetts Tax-Exempt Fund+ 10/31/04 5,500
10/31/03 7,011
Columbia New York Tax-Exempt Fund 10/31/04 6,500
10/31/03 6,500
Columbia Small Cap Value Fund 6/30/04 8,862
6/30/03 16,150
Columbia Growth & Income Fund 7/31/04 6,441
7/31/03 10,600
Columbia Newport Tiger Fund 8/31/04 9,662
8/31/03 13,966
Columbia Income Fund 3/31/05 6,354
3/31/04 6,512
Columbia Intermediate Bond Fund 3/31/05 8,154
3/31/04 6,512
Columbia High Yield Municipal Fund+ 6/30/04 6,400
6/30/03 14,600
Columbia Managed Municipals Fund+ 6/30/04 8,700
6/30/03 14,200
Columbia Growth Stock Fund 9/30/04 5,912
9/30/03 8,100
Columbia Young Investor Fund 9/30/04 9,441
9/30/03 8,100
Columbia Dividend Income Fund+ 9/30/04 5,500
9/30/03 6,520
Columbia Asset Allocation Fund+ 9/30/04 5,500
9/30/03 6,520
</Table>
E-5
<Table>
<Caption>
NON-AUDIT
FUND NAME FYE SERVICES
- --------- -------- ---------
Columbia Large Cap Core Fund+ 9/30/04 5,500
9/30/03 6,520
Columbia Large Cap Growth Fund+ 9/30/04 5,500
9/30/03 6,520
Columbia Disciplined Value Fund+ 9/30/04 5,500
9/30/03 6,520
Columbia Small Company Equity Fund+ 9/30/04 5,500
9/30/03 6,520
Columbia Small Cap Fund+ 9/30/04 8,200
9/30/03 6,520
</Table>
+ Effective March 1, 2004, PwC replaced E&Y as auditors.
The table above does not include $95,000 paid in both fiscal years to PwC by a
control affiliate related to internal controls reviews of the registrant's
transfer agent.
E-6
APPENDIX F -- SHARES OUTSTANDING AND ENTITLED TO VOTE
For each class of the Funds' shares entitled to vote at the Meeting, the number
of shares outstanding as of June 28, 2005 was as follows:
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA HIGH YIELD OPPORTUNITY FUND
A 59,088,118.2600
B 41,512,145.4330
C 6,541,453.3920
Z 2,782,028.3510
COLUMBIA STRATEGIC INCOME FUND
A 100,688,322.0090
B 56,446,726.0070
C 8,677,931.7780
J 34,320,725.5960
Z 9,319,809.0560
COLUMBIA TAX-MANAGED GROWTH FUND
A 4,195,680.1970
B 10,715,359.5270
C 1,632,845.3110
E 666,045.6490
F 658,062.1850
Z 19,022.5040
COLUMBIA TAX-MANAGED VALUE FUND
A 1,136,344.4580
B 3,719,206.8830
C 906,687.9700
Z 5,495.9950
COLUMBIA FEDERAL SECURITIES FUND
A 71,753,138.2560
B 6,776,436.0090
C 842,400.5030
Z 3,597,814.0010
COLUMBIA GLOBAL EQUITY FUND
A 6,346,889.6960
B 1,315,436.0610
C 92,225.9570
COLUMBIA INTERMEDIATE GOVERNMENT INCOME FUND
A 268,290.8740
B 227,974.6550
C 130,965.9150
G 234,578.3870
T 3,075,298.2880
Z 28,354,925.5690
</Table>
F-1
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA LIBERTY FUND
A 67,809,636.1070
B 17,107,944.8470
C 660,490.7790
Z 79,036.1210
COLUMBIA MID CAP VALUE FUND
A 26,397,882.1340
B 12,810,829.2550
C 2,660,110.6860
Z 25,603,011.9540
COLUMBIA QUALITY PLUS BOND FUND
A 2,990,556.1720
B 1,093,496.0470
C 475,697.7440
G 331,148.3460
T 2,834,734.1420
Z 87,414,273.2620
COLUMBIA MUNICIPAL MONEY MARKET FUND
A 8,338,179.7960
B 413,173.5270
C 270,589.6100
Z 50,537,783.7020
COLUMBIA TAX-EXEMPT FUND
A 116,390,598.4260
B 2,820,717.7290
C 635,524.8250
COLUMBIA TAX-EXEMPT INSURED FUND
A 14,049,877.3230
B 2,021,984.3410
C 1,104,925.5850
COLUMBIA UTILITIES FUND
A 23,558,618.2290
B 3,936,687.2520
C 501,467.7540
Z 2,412,323.1740
COLUMBIA CALIFORNIA TAX-EXEMPT FUND
A 25,139,278.5890
B 3,166,785.4950
C 1,813,973.9720
Z 0
COLUMBIA CONNECTICUT INTERMEDIATE MUNICIPAL BOND FUND
A 1,062,811.5870
B 495,042.3190
C 868,099.1440
G 27,704.4330
T 2,564,314.6600
Z 12,427,512.6140
</Table>
F-2
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA CONNECTICUT TAX-EXEMPT FUND
A 12,540,702.2230
B 4,825,270.0810
C 2,691,472.9820
COLUMBIA FLORIDA INTERMEDIATE MUNICIPAL BOND FUND
A 109,475.7080
B 45,257.1670
C 112,018.3560
Z 5,618,246.6910
COLUMBIA INTERMEDIATE TAX-EXEMPT BOND FUND
A 1,786,341.5240
B 227,252.9520
C 292,203.9980
G 48,172.4530
T 1,726,300.7020
Z 44,217,274.2460
COLUMBIA LARGE COMPANY INDEX FUND
A 929,904.4970
B 477,250.8760
C 110,679.2640
Z 29,346,550.5510
COLUMBIA MASSACHUSETTS INTERMEDIATE MUNICIPAL BOND FUND
A 800,329.0840
B 310,194.6180
C 672,390.8170
G 86,773.5260
T 5,381,976.6830
Z 22,926,627.5960
COLUMBIA MASSACHUSETTS TAX-EXEMPT FUND
A 18,976,005.1390
B 3,642,996.5320
C 1,815,484.8130
COLUMBIA NEW JERSEY INTERMEDIATE MUNICIPAL BOND FUND
A 376,891.1000
B 190,388.2820
C 465,866.6100
G 16,923.5570
T 667,278.4620
Z 6,040,224.8530
COLUMBIA NEW YORK INTERMEDIATE MUNICIPAL BOND FUND
A 254,972.6900
B 318,714.6720
C 252,106.9890
G 14,558.3890
T 1,673,615.1120
Z 8,463,574.9760
</Table>
F-3
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA NEW YORK TAX-EXEMPT FUND
A 7,826,965.0020
B 3,888,054.0480
C 1,325,308.6530
COLUMBIA RHODE ISLAND INTERMEDIATE MUNICIPAL BOND FUND
A 130,394.8080
B 78,069.3420
C 146,997.3580
G 29,208.8450
T 1,107,431.5640
Z 9,191,318.3220
COLUMBIA SMALL COMPANY INDEX FUND
A 417,237.9020
B 171,087.0490
C 175,769.7110
Z 15,328,411.5210
COLUMBIA U.S. TREASURY INDEX FUND
A 407,187.3260
B 140,585.9900
C 82,585.8600
Z 13,526,375.1260
COLUMBIA GROWTH & INCOME FUND
A 32,041,028.0920
B 38,762,096.5750
C 4,533,674.0710
Z 27,169,696.7190
COLUMBIA SMALL CAP VALUE FUND
A 9,168,156.7230
B 4,807,377.2090
C 1,443,764.7640
Z 1,879,287.6040
COLUMBIA NEWPORT TIGER FUND
A 13,696,940.0190
B 4,103,439.2430
C 1,974,115.8050
T 1,909,353.4190
Z 1,889,513.5510
COLUMBIA INCOME FUND
A 9,768,800.7440
B 2,533,737.6350
C 1,109,277.2390
Z 57,255,745.5640
COLUMBIA INTERMEDIATE BOND FUND
A 20,199,562.5770
B 9,653,544.2880
C 5,066,102.6020
Z 111,883,252.1860
</Table>
F-4
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA HIGH YIELD MUNICIPAL FUND
A 8,016,245.1830
B 2,878,758.6320
C 1,169,809.1540
Z 39,252,626.4790
COLUMBIA MANAGED MUNICIPALS FUND
A 4,949,968.8110
B 639,098.6010
C 243,342.5480
Z 38,850,083.3270
COLUMBIA ASSET ALLOCATION FUND
A 233,458.8980
B 428,127.6000
C 43,854.6510
G 1,593,655.6160
T 11,523,795.0110
Z 10,755,297.0560
COLUMBIA DIVIDEND INCOME FUND
A 2,097,371.3250
B 1,405,016.2600
C 298,281.0110
G 380,187.2200
T 8,455,243.7520
Z 25,360,599.8430
COLUMBIA DISCIPLINED VALUE FUND
A 273,388.0270
B 286,857.3960
C 35,424.5510
G 383,307.8050
T 9,583,502.6080
Z 20,227,561.2500
COLUMBIA GROWTH STOCK FUND
A 5,020,642.2390
B 19,326,443.7140
C 1,560,165.3870
Z 34,127,628.0350
COLUMBIA LARGE CAP CORE FUND
A 765,684.3730
B 503,214.1230
C 42,688.9700
G 899,760.9890
T 13,830,073.4580
Z 25,966,158.1400
</Table>
F-5
<Table>
<Caption>
NUMBER OF SHARES OUTSTANDING
FUND CLASS AND ENTITLED TO VOTE
- ------------------------------------------------ ----------------------------
COLUMBIA LARGE CAP GROWTH FUND
A 495,473.2260
B 381,038.9270
C 69,752.3600
G 2,674,574.3390
T 10,745,548.0160
Z 61,431,244.8100
COLUMBIA SMALL COMPANY EQUITY FUND
A 296,714.0050
B 136,711.0740
C 63,513.1470
G 235,186.7320
T 3,882,795.0480
Z 8,452,798.1460
COLUMBIA SMALL CAP FUND
A 11,159,038.2410
B 2,360,589.2780
C 3,374,160.0680
G 557,716.1270
T 8,075,386.8560
Z 55,646,115.2470
COLUMBIA YOUNG INVESTOR FUND
A 7,183,805.2450
B 456,372.2210
C 63,938.5680
Z 61,018,072.0320
</Table>
F-6
APPENDIX G -- OWNERSHIP OF SHARES
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
COLUMBIA HIGH YIELD OPPORTUNITY FUND -- A
B Citigroup Global Markets, Inc. 2,327,419.7090 5.45 42,701,142.1460
333 W. 34th St.
New York, NY 10001-2402
C Merrill Lynch Pierce Fenner & 400,624.2620 6.01 6,661,854.4010
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Bank of America NA 148,979.4630 5.30 2,812,452.2750
411 N. Akard St.
Dallas, TX 75201-3307
Z Charles Schwab & Co. Inc. 529,045.7550 18.81 2,812,452.2750
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA STRATEGIC INCOME FUND -- A
C Merrill Lynch Pierce Fenner & 609,033.7060 7.28 8,365,861.9830
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Bank of America NA 7,013,855.3160 92.33 7,596,204.3260
411 N. Akard St.
Dallas, TX 75201-3307
J Tokai Tokyo Securities 32,381,625.5960 93.31 34,703,515.5960
Shinyaesu Bldg 7-1
Kyobashi 1-Chome
Chuo-Ku
Tokyo, Japan 104-0031
J Mitsubishi Securities Co. Ltd. 2,321,890.0000 6.69 34,703,515.5960
Investment Trust Division
Mitsubishi Building
2-5-2 Marunouchi
Chiyoda-Ku Tokyo 100-0005
Japan
COLUMBIA TAX-MANAGED GROWTH FUND -- A
Z Jonathan Lowet 6,259.8630 32.91 19,022.5040
160 E. 91st St.
New York, NY 10125-0001 ]
</Table>
G-1
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Merrill Lynch Pierce Fenner & 150,919.6600 8.89 1,698,165.1330
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Streimer Sheet Metal Works 11,980.8310 62.98 19,022.5040
Inc.
740 N. Knott St.
Portland, OR 97227-2099
COLUMBIA TAX-MANAGED VALUE FUND -- A
Z Rose Diaz & 1,400.3650 25.54 5,483.7800
Robert R. Diaz
91 Salem Rd.
Fishkill, NY 12524-1420
Z Steven J. Barbon 2,427.6170 44.27 5,483.7800
Robert P. Rohall
P.O. Box 279
Temple, PA 19560-0279
Z Robert P. Rohall 648.0720 11.82 5,483.7800
701 Georgia Ave.
Reading, PA 19605-1109
Z The Dekema Living Trust 929.7600 16.95 5,483,7800
P.O. Box 2174
Friday Harbor, WA 98250-2174
A LPL Financial Services 79,649.2750 6.87 1,158,993.7370
9785 Towne Centre Dr.
San Diego, CA 92121-1968
COLUMBIA FEDERAL SECURITIES FUND -- A
C Citigroup Global Markets, Inc. 44,291.5210 5.23 846,122.8880
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Merrill Lynch Pierce Fenner & 51,949.4470 6.14 846,122.8880
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Columbia Thermostat Fund 3,139,993.5170 95.23 3,297,218.3520
227 W. Monroe St. Ste. 3000
Chicago, IL 60606-5018
COLUMBIA GLOBAL EQUITY FUND -- A
A Citigroup Global Markets, Inc. 376,301.2450 5.87 6,405,860.1650
7th Floor
333 W. 34th St.
New York, NY 10001-2402
</Table>
G-2
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C UBS Financial Services Inc. 5,798.7110 6.18 93,784.1430
FBO
James D. Heerwagen
P.O. Box 3321,
1000 Harbor Blvd.
Weehawken, NJ 07086-6761
C Merrill Lynch Pierce Fenner & 6,217.5060 6.63 93,784.1430
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA INTERM GOVERNMENT INCOME FD-T
A MCB Trust Services Cust FBO 14,526.5300 5.41 268,526.9560
IMPCO Technologies Inc.
Deferred C
700 17th St. Ste. 300
Denver, CO 80202-3531
A ADP Clearing & Outsourcing 13,953.4880 5.20 268,526.9560
26 Broadway
New York, NY 10004-1703
C ADP Clearing & Outsourcing 10,106.3220 7.67 131,749.6250
26 Broadway
New York, NY 10004-1703
A Ferris Baker Watts Inc. 77,726.2040 28.95 268,526.9560
75 Arch St. Ste. 402
Akron, OH 44304-1433
C UBS Financial Services Inc. 28,901.3030 21.94 131,749.6250
FBO
MS Public Health Workers
Federal Credit Union
2815 N. State St.
Jackson, MS 39216-4306
C UBS Financial Services Inc. 14,312.9770 10.86 131,749.6250
FBO
Mississippi Public Employees
Credit Union
613 S. West St.
Jackson, MS 39201-5506
C UBS Financial Services Inc. 19,221.6390 14.59 131,749.6250
FBO
Ferguson FCU
577 N. A. Sandifer Rd.
Monticello, MS 39654-7691
Z Bank of America NA 26,682,457.1190 93.10 28,661,001.1080
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA LIBERTY FUND -- A
Z ADP Clearing & Outsourcing 5,888.7270 7.49 78,605.0130
26 Broadway
New York, NY 10004-1703
</Table>
G-3
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Se Boo Kang & 5,976.4110 7.60 78,605.0130
In Soon Kang
1305 King Arthur Dr.
Mechanicsburg, PA 17050-7672
Z William R. Larsen & 10,697.6500 13.61 78,605.0130
Beatriz M. De Larsen
416 E 11th St. SE
Rome, GA 30161-6222
Z Streimer Sheet Metal Works 20,222.6510 25.73 78,605.0130
Inc.
740 N. Knott St.
Portland, OR 97227-2099
COLUMBIA MID CAP VALUE FUND -- Z
C Merrill Lynch Pierce Fenner & 390,881.5240 14.50 2,696,070.1990
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Bank of America NA 8,275,067.5790 31.98 25,878,387.6830
411 N. Akard St.
Dallas, TX 75201-3307
Z Charles Schwab & Co. Inc. 2,687,029.6960 10.38 25,878,387.6830
Special custody account for
the exclusive benefit of
customers
101 Montgomery St.
San Francisco, CA 94104-4122
A Charles Schwab & Co. Inc. 2,298,500.1270 8.64 26,594,955.8710
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA QUALITY PLUS BOND FUND -- T
G ADP Clearing & Outsourcing 33,074.1010 9.10 363,628.4870
26 Broadway
New York, NY 10004-1703
C Merrill Lynch Pierce Fenner & 42,550.4310 8.97 474,113.4280
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A American Express Trust Company 703,600.6330 23.58 2,984,273.1560
996 AXP Financial Ctr.
Minneapolis, MN 55474-0009
Z Amvescap National Trust Co as 11,070,544.8170 12.90 85,850,781.9100
Agent for Fleet National Bank
FBO
FleetBoston Financialsavings
Plus
P.O. Box 105779
Atlanta, GA 30348-5779
</Table>
G-4
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Bank of America NA TTEE 11,199,784.6620 13.05 85,850,781.9100
FBO Bank of America 401K Plan
700 Louisiana St.
Houston, TX 77002-2700
Z Bank of America NA 57,998,698.5480 67.56 85,850,781.9100
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. 514,777.4460 17.25 2,984,273.1560
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA MUNICIPAL MONEY MARKET FUND -- A
C NFSC 74,456.1200 27.93 266,589.6100
Rodolfo A. Gonzales
Rudy T. Gonzales
796 Ash Ave.
Chula Vista, CA 91910-5320
C UBS Financial Services Inc. 42,662.8600 16.00 266,589.6100
FBO
Jo E. Leibowitz
1220 Sara Ct.
Silver City, NM 88061-7104
B Pershing LLC 76,941.0000 18.62 413,173.5270
P.O. Box 2052
Jersey City, NJ 07303-2052
B ADP Clearing & Outsourcing 25,234.0900 6.11 413,173.5270
26 Broadway
New York, NY 10004-1703
A ADP Clearing & Outsourcing 609,044.7500 7.20 8,464,679.3560
26 Broadway
New York, NY 10004-1703
B Robert Young Tod 63,343.8200 15.33 413,173.5270
992 Oak Street
East Hartford, CT 06118-3550
B First Clearing, LLC 36,222.7000 8.77 413,173.5270
Brian J. Downing & Cheryl
Downing Family Trust
8115 C R 135
Celina, TX 75009
C First Clearing Corporation 21,167.5700 7.94 266,589.6100
Randolph C. Lindel & Nancy E.
Lindel
46 Deer Hill Ave.
Danbury, CT 06810-7937
</Table>
G-5
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
B UBS Financial Services Inc. 30,484.4300 7.38 413,173.5270
FBO
Robert L. Polin &
Ann H. Polin
176 Polin Farm Road
Elloree, SC 29047-9504
C Marcia A. Kemp 50,399.4200 18.91 266,589.6100
Thomas W. Kemp
7550 Hessler Dr. NE
Rockford, MI 49341-9509
C Ann M. Meinke 34,828.0400 13.06 266,589.6100
Patricia K. Westgate
4555 Honey Creek Ave. NE
Ada, MI 49301-9629
C Jefferson Liu & 34,460.9700 12.93 266,589.6100
Donna Y. Liu
28761 Appletree
Mission Viejo, CA 92692-1089
A The Price Family Trust 500,501.2800 5.91 8,464,679.3560
1 Quail Ridge Rd. S.
Rolling Hills, CA 90274-5017
A Robert F. Kidd & Joan H. Story 461,483.0400 5.45 8,464,679.3560
61 Marr Ave.
Oakland, CA 94611-3130
B Dean Witter FBO 90,519.5100 21.91 413,173.5270
Nancy W. Garn
P.O. Box 250
New York, NY 10008-0250
A Joseph Sherman DBA 610,840.3900 7.22 8,464,679.3560
Sierra Pines
P.O. Box 1416
San Gabriel, CA 91778-1416
COLUMBIA TAX-EXEMPT FUND -- A
C Pershing LLC 54,365.5770 8.28 656,969.7170
P.O. Box 2052
Jersey City, NJ 07303-2052
B Merrill Lynch Pierce Fenner & 360,117.6200 12.30 2,927,025.9790
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 106,997.3590 16.29 656,969.7170
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
</Table>
G-6
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
COLUMBIA TAX-EXEMPT INSURED FUND -- A
C Citigroup Global Markets, Inc. 317,358.5530 26.37 1,203,586.3670
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 218,525.8210 10.77 2,029,818.6610
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 355,906.4590 29.57 1,203,586.3670
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA UTILITIES FUND -- A
B Citigroup Global Markets, Inc. 255,169.3110 6.35 4,020,298.7260
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 40,099.2850 7.95 504,275.4410
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 349,873.5560 8.70 4,020,298.7260
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 73,952.2970 14.67 504,275.4410
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A Merrill Lynch Pierce Fenner & 1,811,182.0030 7.60 23,825,132.4420
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA CALIFORNIA TAX-EXEMPT FUND -- A
C NFSC 119,203.9450 6.51 1,830,765.8510
Shirley Ann Del Faro
Livingtrust
3901 Alonzo Ave.
Encino, CA 91316-4408
</Table>
G-7
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
B Citigroup Global Markets, Inc. 224,721.3900 6.88 3,268,074.6940
7th Floor
333 W. 34th St.
New York, NY 10001-2402
A Citigroup Global Markets, Inc. 1,989,744.3930 7.81 25,463,350.8670
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 230,289.7660 7.05 3,268,074.6940
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 519,023.8750 28.35 1,830,765.8510
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A Merrill Lynch Pierce Fenner & 1,386,230.8110 5.44 25,463,350.8670
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA CT INTERM MUNI BOND FUND -- T
A UBS Financial Services Inc. 69,482.2890 6.05 1,147,536.6560
Sharon Hosley
44 Hamre Ln.
Branford, CT 06405-3736
A UBS Financial Services Inc. 60,399.6370 5.26 1,147,536.6560
Richard Hosley
44 Hamre Lane
Branford, CT 06405-3736
T Kelly F. Shackelford 151,804.5160 5.77 2,630,965.4370
P.O. Box 672
New Canaan, CT 06840-0672
A Citigroup Global Markets, Inc. 438,585.0410 38.22 1,147,536.6560
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 62,541.6630 6.83 915,298.6010
7th Floor
333 W. 34th St.
New York, NY 10001-2402
G ADP Clearing & Outsourcing 4,440.5910 16.00 27,747.5940
26 Broadway
New York, NY 10004-1703
</Table>
G-8
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
G ADP Clearing & Outsourcing 1,529.5300 5.51 27,747.5940
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 3,059.0940 11.02 27,747.5940
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 3,236.4020 11.66 27,747.5940
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 9,041.7010 32.59 27,747.5940
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 2,971.3580 10.71 27,747.5940
26 Broadway
New York, NY 10004-1703
A Merrill Lynch Pierce Fenner & 226,659.2690 19.75 1,147,536.6560
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
B Merrill Lynch Pierce Fenner & 138,808.5210 27.98 496,145.1440
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 236,063.1050 25.79 915,298.6010
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
B UBS Financial Services Inc. 33,397.3940 6.73 496,145.1440
FBO
Gabriel G. Haddad and Karen K.
Haddad
24 Bedford Rd.
Greenwich, CT 06831-2533
Z Bank of America NA 11,231,637.6490 94.57 11,876,300.6140
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA MA INTERM MUNI BOND FUND -- T
B Pershing LLC 16,300.0250 5.05 322,662.7170
PO Box 2052
Jersey City, NJ 07303-2052
G ADP Clearing & Outsourcing 10,877.9520 12.54 86,773.5260
26 Broadway
New York, NY 10004-1703
</Table>
G-9
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
G ADP Clearing & Outsourcing 7,893.1520 9.10 86,773.5260
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 21,238.6370 24.48 86,773.5260
26 Broadway
New York, NY 10004-1703
T ADP Clearing & Outsourcing 282,175.7910 5.22 5,401,785.4250
26 Broadway
New York, NY 10004-1703
T ADP Clearing & Outsourcing 293,745.5180 5.44 5,401,785.4250
26 Broadway
New York, NY 10004-1703
A Merrill Lynch Pierce Fenner & 71,817.1320 7.34 977,826.3590
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 81,273.0190 12.07 673,573.6590
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
A A G Edwards & Sons Inc. 191,306.9140 19.56 977,826.3590
1 N. Jefferson Ave.
Saint Louis, MO 63103-2205
Z Bank of America NA 22,477,564.5750 97.61 23,027,503.0420
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. 117,584.0980 18.16 977,826.3590
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA CONNECTICUT TAX-EXEMPT FUND -- A
A Citigroup Global Markets, Inc. 724,808.2730 5.73 12,638,689.5370
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 652,684.9000 13.04 5,007,005.3660
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 488,474.1410 17.88 2,732,200.9430
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
</Table>
G-10
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
A Merrill Lynch Pierce Fenner & 859,698.4110 6.80 12,638,689.5370
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA FLORIDA INTERM MUNI BOND FD -- Z
A NFSC 18,967.4260 17.28 109,733.7330
William F. Davis Trust
2949 Sunset Point Rd.
Clearwater, FL 33759-1615
B NFSC 3,268.5410 7.16 45,651.9510
Sid Cox Jr. Revoctrust
353 Kelly Plantation Dr.
Destin, FL 32541-3404
B NFSC 2,875.4580 6.30 45,651.9510
Jeremiah & Edith Danberg Revoc
104 Apache Way
Tewksbury, MA 01876-4617
A Citigroup Global Markets, Inc 12,208.6930 11.13 109,733.7330
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Citigroup Global Markets, Inc 3,605.0790 7.90 45,651.9510
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Pershing LLC 2,408.0000 5.27 45,651.9510
P.O. Box 2052
Jersey City, NJ 07303-2052
B Pershing LLC 2,416.1790 5.29 45,651.9510
P.O. Box 2052
Jersey City, NJ 07303-2052
B ADP Clearing & Outsourcing 2,430.7470 5.32 45,651.9510
26 Broadway
New York, NY 10004-1703
C Merrill Lynch Pierce Fenner & 67,331.6850 60.18 111,875.3870
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
B Merrill Lynch Pierce Fenner & 6,553.9430 14.36 45,651.9510
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
</Table>
G-11
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
B UBS Financial Services Inc. 3,653.7740 8.00 45,651.9510
FBO
P.O. Box 7082
Indian Lakes Est., FL
33855-7082
B Janney Montgomery Scott LLC 9,579.0000 20.98 45,651.9510
U/W Elsie M. Kelber
1801 Market St.
Philadelphia, PA 19103-1628
C First Clearing LLC 8,559.5700 7.65 111,875.3870
Rita Cohen
57 Pratt St. Ste. 815
Hartford, CT 06103-1614
C First Clearing, LLC 19,775.4280 17.68 111,875.3870
1255 Pasadena Ave. S. Apt. 405
S. Pasadena, FL 33707-6207
A A G Edwards & Sons Inc. FBO 22,189.1980 20.22 109,733.7330
T. Frank Syfrett &
Patricia B. Syfrett
1 N. Jefferson Ave.
Saint Louis, MO 63103-2205
Z Bank of America NA 5,373,063.9630 93.02 5,776,071.0980
411 N. Akard St.
Dallas, TX 75201-3307
C Dean Witter FBO 5,612.7220 5.02 111,875.3870
Theodore P. Zawada Trust
P.O. Box 250
New York, NY 10008-0250
C Dean Witter FBO 7,951.3560 7.11 111,875.3870
P.O. Box 250
New York, NY 10008-0250
A Charles Schwab & Co. Inc. 26,470.9030 24.12 109,733.7330
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA INTERM TAX-EXEMPT BOND FUND -- T
G Anna Pulson & 3,114.7200 5.70 54,607.6200
Nicola Pulsone
48 Derby St.
West Newton, MA 02465-1602
C NFSC 16,294.1480 5.60 290,906.4160
Sirios Livingtrust
1254 Cuyamaca Ave.
Chula Vista, CA 91911-3553
A Citigroup Global Markets, Inc. 105,104.7380 5.64 1,862,717.1610
7th Floor
333 W. 34th St.
New York, NY 10001-2402
</Table>
G-12
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Citigroup Global Markets, Inc. 27,480.3060 9.45 290,906.4160
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Citigroup Global Markets, Inc. 23,658.2840 10.62 222,873.9360
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Pershing LLC 17,540.3180 7.87 222,873.9360
P.O. Box 2052
Jersey City, NJ 07303-2052
G ADP Clearing & Outsourcing 18,542.8280 33.96 54,607.6200
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 8,515.7480 15.59 54,607.6200
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 4,767.1150 8.73 54,607.6200
26 Broadway
New York, NY 10004-1703
A Merrill Lynch Pierce Fenner & 309,293.0030 16.60 1,862,717.1610
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 98,382.2840 33.82 290,906.4160
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
G Howard L. Lovelace & Mary E. 7,188.5940 13.16 54,607.6200
Lovelace
15 Nottinghill Ct.
Manalapan, NJ 07726-8685
G Fiserv Securities Inc. 3,147.2800 5.76 54,607.6200
One Commerce Square
2005 Market St. Ste. 1200
Philadelphia, PA 19103-7008
A UBS Financial Services Inc. 101,619.9160 5.46 1,862,717.1610
FBO
Margaret E. Diponio
14800 Farmington Rd. Ste. 102
Livonia, MI 48154-5464
C A G Edwards & Sons Inc. FBO 30,761.7000 10.57 290,906.4160
Richard J. Miele & Carmel L.
Miele
1 N. Jefferson Ave.
Saint Louis, MO 63103-2205
</Table>
G-13
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Bank of America NA 33,930,088.1330 78.26 43,355,183.0030
411 N. Akard St.
Dallas, TX 75201-3307
T Charles Schwab & Co. Inc. 154,182.3750 8.82 1,747,395.0520
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA LARGE COMPANY INDEX FUND -- Z
C NFSC 8,894.6360 7.89 112,694.9550
Gary J. Gartner
2002 Irrevtrust
599 Lexington Ave.
New York, NY 10022-6030
Z Amvescap National Trust Co. 6,416,064.0300 21.60 29,701,346.4110
FleetBoston Financialsavings
Plus
P.O. Box 105779
Atlanta, GA 30348-5779
Z Bank of America NA 5,916,805.8200 19.92 29,701,346.4110
411 N. Akard St.
Dallas, TX 75201-3307
A Bank of America 164,879.8610 18.22 904,996.0970
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA MA INTERM MUNI BOND FUND -- T
B Pershing LLC 16,300.0250 5.05 322,662.7170
P.O. Box 2052
Jersey City, NJ 07303-2052
G ADP Clearing & Outsourcing 10,877.9520 12.54 86,773.5260
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 7,893.1520 9.10 86,773.5260
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 21,238.6370 24.48 86,773.5260
26 Broadway
New York, NY 10004-1703
T ADP Clearing & Outsourcing 282,175.7910 5.22 5,401,785.4250
26 Broadway
New York, NY 10004-1703
T ADP Clearing & Outsourcing 293,745.5180 5.44 5,401,785.4250
26 Broadway
New York, NY 10004-1703
A Merrill Lynch Pierce Fenner & 71,817.1320 7.34 977,826.3590
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
</Table>
G-14
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Merrill Lynch Pierce Fenner & 81,273.0190 12.07 673,573.6590
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
A A G Edwards & Sons Inc. FBO 191,306.9140 19.56 977,826.3590
Mark Haller
1 N. Jefferson Ave.
Saint Louis, MO 63103-2205
Z Bank of America NA 22,477,564.5750 97.61 23,027,503.0420
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. Cust 177,584.0980 18.16 977,826.3590
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA MA TAX-EXEMPT FUND -- A
B Citigroup Global Markets, Inc. 303,468.7860 8.06 3,766,333.9220
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 105,049.5190 5.79 1,814,688.4520
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Merrill Lynch Pierce Fenner & 510,213.2500 28.12 1,814,688.4520
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA NJ INTERM MUNI BOND FUND -- T
A RBC Dain Rauscher Inc. FBO 47,641.5090 12.51 380,773.0670
Catherine McTernan
James McTernan
146 Patriot Hill Dr.
Basking Ridge, NJ 07920-4216
C RBC Dain Rauscher Inc. FBO 28,873.9170 6.14 470,250.4560
Catherine McTernan
James McTernan
146 Patriot Hill Dr.
Basking Ridge, NJ 07920-4216
G ADP Clearing & Outsourcing 1,528.1750 9.03 16,923.5570
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 12,675.9790 74.90 16,923.5570
26 Broadway
New York, NY 10004-1703
</Table>
G-15
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
A ADP Clearing & Outsourcing 153,696.0980 40.36 380,773.0670
26 Broadway
New York, NY 10004-1703
B ADP Clearing & Outsourcing 10,048.7740 5.27 190,638.4540
26 Broadway
New York, NY 10004-1703
C ADP Clearing & Outsourcing 27,837.4140 5.92 470,250.4560
26 Broadway
New York, NY 10004-1703
C ADP Clearing & Outsourcing 34,478.8830 7.33 470,250.4560
26 Broadway
New York, NY 10004-1703
T ADP Clearing & Outsourcing 51,137.9660 7.64 669,115.6470
26 Broadway
New York, NY 10004-1703
A Merrill Lynch Pierce Fenner & 24,724.0130 6.49 380,773.0670
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 104,196.4610 22.16 470,250.4560
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
G Cynthia L. Peterson 1,048.5720 6.20 16,923.5570
68 Davidson Ave.
Ramsey, NJ 07446-1465
C First Clearing, LLC 52,955.1620 11.26 470,250.4560
Peter A. Staats
P.O. Box 106
Belle Mead, NJ 08502-0106
Z Bank of America NA 5,753,028.3870 95.48 6,025,364.5040
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. Cust 50,996.7440 13.39 380,773.0670
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA NY INTERM MUNI BOND FUND -- T
B NFSC 18,674.8940 5.39 346,308.1160
Emma Persico
56 Millsburg Rd.
Middletown, NY 10940-8410
G Shelley J. Masters 898.8320 5.44 16,509.5720
60 Morrow Ave. Apt. 6AN
Scarsdale, NY 10583-8153
</Table>
G-16
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Citigroup Global Markets, Inc. 32,039.5490 14.65 218,641.4730
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Pershing LLC 14,364.5760 6.57 218,641.4730
P.O. Box 2052
Jersey City, NJ 07303-2052
G ADP Clearing & Outsourcing 1,940.1190 11.75 16,509.5720
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 963.2980 5.83 16,509.5720
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 1,803.6440 10.92 16,509.5720
26 Broadway
New York, NY 10004-1703
B Merrill Lynch Pierce Fenner & 81,249.8340 23.46 346,308.1160
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 57,383.2280 26.25 218,641.4730
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
G FISERV Securities Inc. 9,789.8760 59.30 16,509.5720
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7008
Z Bank of America NA 8,124,676.0270 97.79 8,307,872.5150
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. Cust 47,675.8740 18.73 254,483.0810
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA NEW YORK TAX-EXEMPT FUND -- A
B Citigroup Global Markets, Inc. 266,668.9550 6.69 3,987,559.7830
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 364,225.6020 27.58 1,320,591.4690
7th Floor
333 W. 34th St.
New York, NY 10001-2402
</Table>
G-17
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
A Citigroup Global Markets, Inc. 629,528.6660 8.02 7,850,933.3660
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 351,560.7540 8.82 3,987,559.7830
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 289,655.4730 21.93 1,320,591.4690
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A Merrill Lynch Pierce Fenner & 553,408.5080 7.05 7,850,933.3660
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
COLUMBIA RI INTERM MUNI BOND FUND -- T
A Virginia D. Rossi Tod 30,060.2960 23.09 130,180.1710
720 Chopmist Hill Rd.
N Scituate, RI 02857-1052
T John J. Almeida Revocable 60,371.8570 5.45 1,107,714.4320
Trust
27 Topmast Ct.
Jamestown, RI 02835-2227
A Citigroup Global Markets, Inc. 44,695.4310 34.33 130,180.1710
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Pershing LLC 20,538.7400 14.00 146,749.9130
P.O. Box 2052
Jersey City, NJ 07303-2052
G ADP Clearing & Outsourcing 6,329.1140 19.61 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 3,092.1710 9.58 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 1,970.6960 6.11 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 1,967.9790 6.10 32,273.3460
26 Broadway
New York, NY 10004-1703
</Table>
G-18
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
G ADP Clearing & Outsourcing 2,870.9190 8.90 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 3,553.4760 11.01 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 2,709.9580 8.40 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 6,956.6830 21.56 32,273.3460
26 Broadway
New York, NY 10004-1703
G ADP Clearing & Outsourcing 2,822.3500 8.75 32,273.3460
26 Broadway
New York, NY 10004-1703
A ADP Clearing & Outsourcing 12,772.9390 9.81 130,180.1710
26 Broadway
New York, NY 10004-1703
A ADP Clearing & Outsourcing 14,446.1810 11.10 130,180.1710
26 Broadway
New York, NY 10004-1703
B ADP Clearing & Outsourcing 18,731.8180 23.99 78,069.3420
26 Broadway
New York, NY 10004-1703
B ADP Clearing & Outsourcing 24,398.6340 31.25 78,069.3420
26 Broadway
New York, NY 10004-1703
B ADP Clearing & Outsourcing 7,605.2810 9.74 78,069.3420
26 Broadway
New York, NY 10004-1703
C Merrill Lynch Pierce Fenner & 64,324.5370 43.83 146,749.9130
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C First Clearing LLC 10,041.1130 6.84 146,749.9130
1174 Logee St.
Woonsocket, RI 02895-6031
C Legg Mason Wood Walker Inc. 8,044.1400 5.48 146,749.9130
P.O. Box 1476
Baltimore, MD 21203-1476
Z Bank of America NA 8,926,820.1980 97.62 9,144,063.7360
411 N. Akard St.
Dallas, TX 75201-3307
</Table>
G-19
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Morgan Stanley DW Inc. FBO 8,118.6400 5.53 146,749.9130
Harvey Bennett Jr.
Harborside Financial Cntr
Plaza 3
Jersey City, NJ 07311
T Charles Schwab & Co. Inc. 102,037.1210 9.21 1,107,714.4320
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA SMALL COMPANY INDEX FUND -- Z
A MCB Trust Services Cust. FBO 29,317.4700 7.03 417,192.0770
Princeton Softech Inc.
700 17th St. Ste. 300
Denver, CO 80202-3531
C NFSC 10,377.6430 5.73 181,117.5640
Madison Historical Society
Inc.
P.O. Box 17
Madison, CT 06443-0017
C NFSC 17,351.4440 9.58 181,117.5640
Ministerial Fund of
I Cong. Church of Madison
39 Sunny Hill Dr.
Madison, CT 06443-3305
C Pershing LLC 10,226.6940 5.65 181,117.5640
P.O. Box 2052
Jersey City, NJ 07303-2052
A Reliance Trust Co. Cust 26,430.6620 6.34 417,192.0770
P.O. Box 48529
Atlanta, GA 30362-1529
A Mercer Trust Company 22,258.2950 5.34 417,192.0770
Transmetta 401(K) Plan
One Investors Way
752270 M.S. N-6-H
Norwood, MA 02062-1599
COLUMBIA U.S. TREASURY INDEX FUND -- Z
B Columbia Trust Company IRA 8,033.0780 5.79 138,801.3100
Michael A. Marino
5 Stoneybrook Dr.
Bridgewater, MA 02324-3555
A Steffian Bradley Architects 19,847.8400 5.13 387,050.7630
401K Plan
Metro Center
1 Station Pl.
Stamford, CT 06902-6800
A Pershing LLC 28,051.4770 7.25 387,050.7630
P.O. Box 2052
Jersey City, NJ 07303-2052
</Table>
G-20
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
B Pershing LLC 12,722.9080 9.17 138,801.3100
P.O. Box 2052
Jersey City, NJ 07303-2052
C ADP Clearing & Outsourcing 6,210.3080 7.75 80,102.8680
26 Broadway
New York, NY 10004-1703
C Bear Stearns Securities Corp. 5,796.0810 7.24 80,102.8680
1 Metrotech Center North
Brooklyn, NY 11201-3870
C First Clearing LLC 9,456.1640 11.81 80,102.8680
Lenore Brusca
12 Layng Ter.
Springfield, NJ 07081-2908
A Legg Mason Wood Walker Inc. 38,921.2340 10.06 387,050.7630
P.O. Box 1476
Baltimore, MD 21203-1476
A Legg Mason Wood Walker Inc. 62,127.9680 16.05 387,050.7630
P.O. Box 1476
Baltimore, MD 21203-1476
C Legg Mason Wood Walker Inc. 27,726.1670 34.61 80,102.8680
P.O. Box 1476
Baltimore, MD 21203-1476
A Reliance Trust Co. 23,824.6350 6.16 387,050.7630
P.O. Box 48529
Atlanta, GA 30362-1529
Z Bank of America NA 4,348,044.0170 31.00 14,026,947.6830
411 N. Akard St.
Dallas, TX 75201-3307
B LPL Financial Services 7,950.8610 5.73 138,801.3100
9785 Towne Centre Drive
San Diego, CA 92121-1968
COLUMBIA GROWTH & INCOME FUND -- A
Z AMVESCAP Natl. Tr. Co. 11,585,918.7910 40.46 28,638,265.0970
Fleet Boston Financial Savings
Plus
P.O. Box 105779
Atlanta, GA 30348-5779
Z Bank of America NA 4,297,336.6760 15.01 28,638,265.0970
411 N. Akard St.
Dallas, TX 75201-3307
Z Charles Schwab & Co. Inc. 2,249,928.1690 7.86 28,638,265.0970
Special custody account for
the exclusive benefit of
customers
101 Montgomery St.
San Francisco, CA 94104-4122
</Table>
G-21
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
A Charles Schwab & Co. Inc. 1,803,962.7880 5.57 32,376,526.0130
Cust.
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA SMALL CAP VALUE FUND -- A
A New York Life Trust Company 473,078.9910 5.21 9,087,519.6570
846 University Ave.
Norwood, MA 02062-2641
B Merrill Lynch Pierce Fenner & 276,533.8220 5.61 4,927,248.0370
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 287,000.5280 20.01 1,434,579.7420
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Bank of America NA 1,558,118.1440 88.98 1,751,046.8650
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. 960,689.4630 10.57 9,087,519.6570
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA NEWPORT TIGER FUND -- A
A Fidelity Investments Inst. L 1,151,958.4680 8.28 13,908,777.6070
OPS Co.
FIIOC as agent for certain
employee benefit plans
100 Magellan Way
Covington, KY 41015-1999
B Citigroup Global Markets, Inc. 245,178.0370 5.72 4,286,317.3980
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 176,648.8060 8.76 2,015,676.5550
7th Floor
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 367,366.6400 8.57 4,286,317.3980
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
</Table>
G-22
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Merrill Lynch Pierce Fenner & 382,516.8570 18.98 2,015,676.5550
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A Merrill Lynch Pierce Fenner & 781,780.0670 5.62 13,908,777.6070
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A The Northern Trust Company 1,164,978.7500 8.38 13,908,777.6070
A G Edwards Inc.
P.O. Box 92994
Chicago, IL 60675-2994
Z Bank of America NA 267,027.8450 13.96 1,912,872.6310
411 N. Akard St.
Dallas, TX 75201-3307
Z Liberty Northwest Insurance 334,101.6460 17.47 1,912,872.6310
Corp.
P.O. Box 4555
Portland, OR 97208-4555
Z Charles Schwab & Co. Inc. 579,496.0560 30.29 1,912,872.6310
101 Montgomery St.
San Francisco, CA 94104-4122
A Charles Schwab & Co. Inc. 778,404.1640 5.60 13,908,777.6070
101 Montgomery St.
San Francisco, CA 94104-4122
COLUMBIA INCOME FUND -- Z
B Merrill Lynch Pierce Fenner & 134,499.4880 5.30 2,539,418.5720
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 77,123.6680 7.10 1,086,783.8640
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Daily Valuation 29,752,912.8590 53.04 56,092,069.1910
The Northern Trust Co.
Mutual Liberty
P.O. Box 92994
Chicago, IL 60675-2994
Z Bank of America NA 4,134,695.2160 7.37 56,092,069.1910
411 N. Akard St.
Dallas, TX 75201-3307
</Table>
G-23
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Charles Schwab & Co. Inc. 4,554,167.4680 8.12 56,092,069.1910
Special custody account for
the exclusive benefit of
customers
101 Montgomery Street
San Francisco, CA 94104-4122
COLUMBIA INTERMEDIATE BOND FUND -- Z
B Citigroup Global Markets, Inc. 569,289.2590 5.83 9,756,733.4790
7th Floor
333 W. 34th St.
New York, NY 10001-2402
Z Citigroup Global Markets Inc. 11,535,288.5850 11.96 96,428,512.6530
333 West 34th Street
7th Floor
Mutual Funds Dept.
New York, NY 10001-2402
C Citigroup Global Markets, Inc. 537,350.2220 10.48 5,125,784.3970
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Merrill Lynch Pierce Fenner & 669,152.7330 13.05 5,125,784.3970
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Columbia Thermostat Fund 6,229,239.6960 6.46 96,428,512.6530
227 W. Monroe St. Ste. 3000
Chicago, IL 60606-5018
Z Bank of America NA 12,282,272.8700 12.74 96,428,512.6530
411 N. Akard St.
Dallas, TX 75201-3307
Z Charles Schwab & Co. Inc. 17,898,826.1140 18.56 96,428,512.6530
Special custody account for
the exclusive benefit of
customers
101 Montgomery Street
San Francisco, CA 94104-4122
A Charles Schwab & Co. Inc. 6,186,189.8070 31.14 19,864,432.5160
101 Montgomery St.
San Francisco, CA 94104-4122
A Transamerica Life Insurance & 3,015,257.0650 15.18 19,864,432.5160
Annuity Company
P.O. Box 30368
Los Angeles, CA 90030-0368
</Table>
G-24
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
COLUMBIA HIGH YIELD MUNICIPAL FUND -- Z
A NFSC 450,584.6280 5.64 7,993,995.9130
Joe Nguyen
Nga Nguyen
Phuong Nguyen
1618 Hilton Head Ln.
Frisco, TX 75034-6919
B Citigroup Global Markets, Inc. 197,623.4550 6.66 2,969,263.0000
333 W. 34th St.
New York, NY 10001-2402
B Merrill Lynch Pierce Fenner & 166,520.5710 5.61 2,969,263.0000
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Merrill Lynch Pierce Fenner & 241,448.7450 21.43 1,126,868.8100
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A Merrill Lynch Pierce Fenner & 436,333.1240 5.46 7,993,995.9130
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Bank of America NA 22,676,906.9830 59.87 37,874,969.4580
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA MANAGED MUNICIPALS FUND -- A
B NFSC 37,157.6250 5.77 643,469.2340
Norman J. Busch Trust
2710 N. McCord Rd.
Toledo, OH 43615-1716
B NFSC 37,157.6250 5.77 643,469.2340
Margaret L. Busch Trust
2710 N. McCord Rd.
Toledo, OH 43615-1716
C Pershing LLC 25,372.6780 10.38 244,343.9080
P.O. Box 2052
Jersey City, NJ 07303-2052
B Merrill Lynch Pierce Fenner & 56,683.0230 8.81 643,469.2340
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
</Table>
G-25
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
C Merrill Lynch Pierce Fenner & 80,824.3120 33.08 244,343.9080
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
C Raymond James & Assoc. Inc. 22,162.8830 9.07 244,343.9080
FBO Sanders D&G
880 Carillon Pkwy.
St. Petersburg, FL 33716-1100
C First Clearing LLC 17,236.5620 7.05 244,343.9080
TDR Builders Inc.
10881 Billingham Ave. NW
Uniontown, OH 44685-9143
Z Charles Schwab & Co. Inc. 2,689,545.5980 6.87 39,172,237.8750
Special custody account for
the exclusive benefit of
customers
101 Montgomery Street
San Francisco, CA 94104-4122
COLUMBIA ASSET ALLOCATION FUND -- T
C NFSC 2,401.1430 5.95 40,334.3660
Joseph W. Schaber
Madonna Schaber
Joseph Schaber
4380 Glenhaven Rd.
Cincinnati, OH 45238-6233
C Citigroup Global Markets, Inc. 2,371.5760 5.88 40,334.3660
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C American Enterprise Investment 3,243.6940 8.04 40,334.3660
Svcs.
P.O. Box 9446
Minneapolis, MN 55440-9446
C American Enterprise Investment 2,294.9590 5.69 40,334.3660
Svcs.
P.O. Box 9446
Minneapolis, MN 55440-9446
Z Bank of America NA 1,528,747.5120 14.15 10,801,768.1420
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA DIVIDEND INCOME FUND -- T
C Citigroup Global Markets, Inc. 15,187.3060 5.14 295,229.7460
7th Floor
333 W. 34th St.
New York, NY 10001-2402
</Table>
G-26
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
B Merrill Lynch Pierce Fenner & 68,567.1830 5.11 1,341,552.9850
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
A SEI Private Trust Co. 660,776.7390 31.99 2,065,824.2480
C/O Wachovia-Premier
One Freedom Valley Drive
Oaks, PA 19456
Z Bank of America NA 23,015,968.0850 96.26 23,909,540.5040
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA DISCIPLINED VALUE FUND -- T
C NFSC 2,712.7830 7.70 35,214.8440
FBO John Boles
603 W. Ojai Ave.
Ojai, CA 93023-3732
C NFSC 1,899.7650 5.39 35,214.8440
FBO Judith L. Davy
7207 John McCain Road
Colleyville, TX 76034-6805
A Pershing LLC 39,282.1350 14.59 269,207.6540
P.O. Box 2052
Jersey City, NJ 07303-2052
C Merrill Lynch Pierce Fenner & 7,385.1890 20.97 35,214.8440
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
C First Clearing LLC 2,425.7670 6.89 35,214.8440
John B. Mercaldo
129 Meadow Brook Rd.
Oxford, CT 06478-4900
Z Bank of America NA 16,555,161.6120 81.28 20,369,108.5190
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA GROWTH STOCK FUND -- A
C Merrill Lynch Pierce Fenner & 134,688.9620 8.32 1,617,936.4870
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Columbia Thermostat Fund 2,609,393.3600 6.48 40,268,912.3550
227 W. Monroe St. Ste. 3000
Chicago, IL 60606-5018
</Table>
G-27
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Charles Schwab & Co. Inc. 2,223,598.2100 5.52 40,268,912.3550
Special custody account for
the exclusive benefit of
customers
101 Montgomery Street
San Francisco, CA 94104-4122
COLUMBIA YOUNG INVESTOR FUND -- A
C Merrill Lynch Pierce Fenner & 10,130.9890 15.83 63,997.8260
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 2
Jacksonville, FL 32246-6484
Z Charles Schwab & Co. Inc. 4,112,089.6180 6.68 61,546,650.9960
Special custody account for
the exclusive benefit of
customers
101 Montgomery Street
San Francisco, CA 94104-4122
COLUMBIA LARGE CAP CORE FUND -- T
C ADP Clearing & Outsourcing 4,089.0660 9.46 43,211.2210
26 Broadway
New York, NY 10004-1703
C FISERV Securities Inc. 2,706.9850 6.26 43,211.2210
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7008
C First Clearing LLC 2,242.4220 5.19 43,211.2210
Roy E. Anger
9130 Cherry Hill Ct.
Fort Myers, FL 33908-3648
C American Enterprise Investment 3,622.2850 8.38 43,211.2210
Svcs.
P.O. Box 9446
Minneapolis, MN 55440-9446
C American Enterprise Investment 2,881.9350 6.67 43,211.2210
Svcs.
P.O. Box 9446
Minneapolis, MN 55440-9446
Z Bank of America NA 10,077,899.2020 37.26 27,046,939.8170
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA LARGE CAP GROWTH FUND -- T
C Charles H. Ventura 8,947.5840 13.41 66,727.8220
745 Distel Dr. Ste. 101
Los Altos, CA 94022-1544
Z AMVESCAP National Trust Co. 7,990,495.7410 12.82 62,320,091.7890
Fleetboston Financialsavings
Plus
P.O. Box 105779
Atlanta, GA 30348-5779
</Table>
G-28
<Table>
<Caption>
CLASS REGISTRATION SHARE BALANCE PERCENT CLASS TOTAL
- ----- ------------------------------ --------------- ------- ---------------
Z Bank of America NA 22,130,317.6800 35.51 62,320,091.7890
411 N. Akard St.
Dallas, TX 75201-3307
C Morgan Stanley DW Inc. FBO 7,137.8150 10.70 66,727.8220
Harvey Bennett Jr.
Harborside Financial Cntr.
Plaza 3
Jersey City, NJ 07311
COLUMBIA SMALL COMPANY EQUITY FUND -- T
C American Enterprise Investment 4,621.2120 7.09 65,146.9390
Svcs.
P.O. Box 9446
Minneapolis, MN 55440-9446
Z Bank of America NA 6,870,868.6790 80.91 8,492,219.2920
411 N. Akard St.
Dallas, TX 75201-3307
A Bank of America 82,247.3250 27.57 298,373.1210
411 N. Akard St.
Dallas, TX 75201-3307
COLUMBIA SMALL CAP FUND -- T
C Citigroup Global Markets, Inc. 186,600.8270 5.29 3,530,696.8050
7th Floor
333 W. 34th St.
New York, NY 10001-2402
C Merrill Lynch Pierce Fenner & 247,038.8790 7.00 3,530,696.8050
Smith
For the sole benefit of its
customers
4800 Deer Lake Dr. E. Fl. 3
Jacksonville, FL 32246-6484
Z Bank of America NA 41,139,541.7370 72.15 57,019,362.1340
411 N. Akard St.
Dallas, TX 75201-3307
A Charles Schwab & Co. Inc. 3,669,385.9010 32.36 11,340,609.6110
Special custody acct. for
exclusive of customers
101 Montgomery St.
San Francisco, CA 94104-4122
T Charles Schwab & Co. Inc. 1,628,610.6250 19.93 8,172,044.4550
Special custody acct. for
exclusive of customers
101 Montgomery St.
San Francisco, CA 94104-4122
</Table>
G-29
EXHIBIT 1
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO BORROWING
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "borrow[,] except from banks, other affiliated funds and other
entities to the extent permitted by the [1940 Act] [Investment Company Act of
1940]."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[b]orrow money, issue senior securities or mortgage, pledge or
hypothecate its assets except to the extent permitted by the [Investment Company
Act of 1940, as amended ("1940 Act")] [1940 Act]."
1
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
The Fund may "[b]orrow from banks, other affiliated funds and other [entities]
[persons] to the extent permitted by applicable law, provided [that] [the]
[each] Fund's borrowings shall not exceed 33 1/3% of the value of its total
assets (including the amount borrowed) less liabilities (other than borrowings)
or such other percentage permitted by law."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[b]orrow money or issue senior securities except that the Fund
may borrow from banks for temporary or emergency purposes, and not for
leveraging, and then in amounts not in excess of 33 1/3% of the value of the
Fund's total assets at the time of such borrowing; or mortgage, pledge, or
hypothecate any assets except in connection with any bank borrowing and in
amounts not in excess of the lesser of the dollar amounts borrowed or 33 1/3% of
the value of the Fund's total assets at the time of such borrowing. Whenever
borrowings are outstanding, a Fund will not make any additional investments
(including roll-overs). For purposes of this restriction, collateral
arrangements with respect to (a) the purchase and sale of options on stock
indexes and (b) initial and variation margin for
2
futures contracts will not be deemed to be issuances of senior securities or to
be pledges of a Fund's assets."
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[b]orrow from banks, other affiliated funds and other entities
except to the extent permitted by applicable law and, provided the Fund's
borrowings shall not exceed 33 1/3% of the value of its total assets (including
the amount borrowed) less liabilities (other than borrowings) or such other
percentage permitted by law."
3
EXHIBIT 2
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO ISSUING SENIOR
SECURITIES
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "[i]ssue any senior security except to the extent permitted
under the [1940 Act][Investment Company Act of 1940]."
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
Series of Columbia Funds Trust I
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Global Equity Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
The Fund may "[n]ot issue senior securities except as provided in paragraph [1]
[4.] above and to the extent permitted [under] [by] the 1940 Act."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Connecticut Intermediate Municipal Bond Fund
1
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[b]orrow money, issue senior securities or mortgage, pledge or
hypothecate its assets except to the extent permitted by the [Investment Company
Act of 1940, as amended (1940 Act)] [1940 Act]."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[b]orrow or issue senior securities except that the Fund may
borrow from banks for temporary or emergency purposes, and not for leveraging,
and then in amounts not in excess of 33 1/3% of the value of its total assets at
the time of borrowing; or mortgage, pledge, or hypothecate any assets except in
connection with such bank borrowing and in amounts not in excess of the lesser
of the dollar amounts borrowed or 33 1/3% of the value of the Fund's total
assets at the time of such borrowing. Whenever borrowings are outstanding, a
Fund will not make any additional investments (including roll-overs). For
purposes of this restriction, collateral arrangements with respect to (a) the
purchase and sale of options on stock indexes and (b) initial and variation
margin for futures contracts will not be deemed to be issuances of senior
securities or to be pledges of a Fund's assets."
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Series of Columbia Funds Trust III
Columbia Federal Securities Fund
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
2
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
The Fund may "[n]ot issue senior securities except as provided in paragraph 1
above to the extent permitted by the Act."
3
EXHIBIT 3
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO MAKING LOANS
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "[m]ake loans, although it may (a) participate in an interfund
lending program with other affiliated registered open-end investment companies
provided that no such loan may be made if, as a result, the aggregate of such
loans would exceed 33 1/3% of the value of its total assets; (b) purchase money
market instruments and enter into repurchase agreements; and (c) acquire
publicly distributed or privately placed debt securities."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "make loans, although it may (a) lend portfolio securities and
participate in an interfund lending program with certain other Funds provided
that no such loan may be made if, as a result, the aggregate of such loans would
exceed 33 1/3% of the value of its total assets (taken at market value at the
time of such loans); (b) purchase money market instruments and enter into
repurchase agreements; and (c) acquire publicly distributed or privately placed
debt securities."
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Global Equity Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
1
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
The Fund may "[m]ake loans (a) through lending of securities, (b) through the
purchase of debt instruments or similar evidences of indebtedness typically sold
privately to financial institutions, (c) through an interfund lending program
with other affiliated funds provided that no such loan be made if, as a result,
the aggregate of such loans would exceed 33 1/3% of the value of its total
assets (taken at market value at the time of such loans) and (d) through
repurchase agreements."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[m]ake loans, except that the Fund may purchase or hold debt
obligations, lend portfolio securities and enter into repurchase agreements, as
described herein and in the prospectus."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
2
The Fund may not "[m]ake loans except to the extent permitted by the 1940 Act."
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "make loans, although it may (a) lend portfolio securities and
participate in an interfund lending program with other affiliated registered
open-end investment companies provided that no such loan may be made if, as a
result, the aggregate of such loans would exceed 33 1/3% of the value of its
total assets (taken at market value at the time of such loans); (b) purchase
money market instruments and enter into repurchase agreements; and (c) acquire
publicly distributed or privately placed debt securities."
3
EXHIBIT 4
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO DIVERSIFICATION OF
INVESTMENTS
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "invest in a security if, with respect to 75% of its assets, as
a result of such investment, more than 5% of its total assets (taken at market
value at the time of such investment) would be invested in the securities of any
one issuer, except that this restriction does not apply to U.S. government
securities or repurchase agreements for such securities and except that all or
substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
substantially similar investment policies as the Fund."
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "invest in a security if, with respect to 75% of its assets, as
a result of such investment, more than 5% of its total assets (taken at market
value at the time of investment) would be invested in the securities of any one
issuer (for this purpose, the issuer(s) of a security being deemed to be only
the entity or entities whose assets or revenues are subject to the principal and
interest obligations of the security), other than obligations issued or
guaranteed by the U.S. government or by its agencies or instrumentalities or
repurchase agreements for such securities, and except that all or substantially
all of the assets of the Fund may be invested in another registered investment
company having the same investment objective and substantially similar
investment policies as the Fund (however, in the case of a guarantor of
securities (including an issuer of a letter of credit) the value of the
guarantee (or letter of credit) may be excluded from this computation if the
aggregate value of securities owned by it and guaranteed by such guarantor (plus
any other investments in securities issued by the guarantor) does not exceed 10%
of its total assets)."
Series of Columbia Funds Trust IV
Columbia Utilities Fund
The Fund may "[w]ith respect to 75% of total assets, not purchase any security
(other than obligations of the U.S. Government and cash items including
receivables) if as a result more than 5% of its total assets would
1
then be invested in securities of a single issuer or purchase the voting
securities of an issuer if, as a result of such purchases, the Fund would own
more than 10% of the outstanding voting shares of such issuer."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[m]ake any investment inconsistent with the Fund's
classification as a diversified series of an open-end investment company under
the 1940 Act."
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
The Fund may not "[m]ake any investment inconsistent with the Fund's
classification as a diversified series of an open-end investment company under
the 1940 Act, provided, however, that the Florida Fund may invest all of its
investable assets in a Qualifying Portfolio (i.e., a diversified, open-end
management investment company having the same investment goal and policies and
substantially the same investment restrictions as those applicable to the Fund).
This limitation does not apply, however, to any Fund classified as a
non-diversified series of an open-end investment company under the 1940 Act."
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "with respect to 75% of its total assets, invest more than 5%
of its total assets, taken at market value at the time of a particular purchase,
in the securities of a single issuer, except for securities issued or guaranteed
by the U.S. Government or any of its agencies or instrumentalities or repurchase
agreements for such securities, and except that all or substantially all of the
assets of the Fund may be invested in another registered investment company
having the same investment objective and substantially similar investment
policies as the Fund."
2
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Federal Securities Fund
Columbia Liberty Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
The Fund may "[n]ot concentrate more than 25% of its total assets in any one
industry or[,] with respect to 75% of total assets[,] purchase any security
(other than obligations of the U.S. government and cash items including
receivables) if as a result more than 5% of its total assets would then be
invested in securities of a single issuer or purchase [the] voting securities of
an issuer if, as a result of such purchase[s], [the] [a] Fund would own more
than 10% of the outstanding voting shares of such issuer."
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[p]urchase the securities of any one issuer (except securities
issued or guaranteed by the U.S. government and its agencies or
instrumentalities, as to which there are no percentage limits or restrictions)
if immediately after and as a result of such purchase (a) more than 5% of the
value of its assets would be invested in that issuer, or (b) the Fund would hold
more than 10% of the outstanding voting securities of that issuer and except
that the Fund may invest all or substantially all of its assets in another
registered investment company having substantially the same investment objective
as the Fund."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[p]urchase the securities of any issuer if as a result more
than 5% of the value of the Fund's total assets would be invested in the
securities of such issuer, except that (a) this 5% limitation does not apply to
U.S. Government securities and (b) up to 25% of the value of the Fund's total
assets may be invested without regard to this 5% limitation."
3
EXHIBIT 5
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO INVESTMENTS IN
COMMODITIES
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "purchase or sell commodities or commodities contracts or oil,
gas, or mineral programs, except that it may enter into futures and options
transactions."
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "purchase or sell real estate (although it may purchase
securities secured by real estate or interests therein, or securities issued by
companies which invest in real estate or interests therein), commodities, or
commodity contracts, except that it may enter into (a) futures and options on
futures and (b) forward contracts."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[p]urchase or sell commodities or commodity contracts except
that the Fund may, to the extent consistent with its investment objective and
policies, purchase and sell financial futures contracts and related options and
foreign currency forward contracts, futures contracts and related options."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
1
The Fund may not "[i]nvest in commodities, except that the Large Company Index
Fund and the Small Company Index Fund may invest in stock index futures."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "purchase or sell commodities or commodities contracts or oil,
gas or mineral programs, except that it may enter into (i) futures and options
on futures and (ii) forward contracts."
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
The Fund may not "[p]urchase or sell commodities or commodity contracts except
that a Fund may, to the extent consistent with its investment goal and policies,
purchase and sell financial futures contracts and related options and foreign
currency forward contracts, futures contracts and related options."
Series of Columbia Funds Trust I
Columbia Tax-Managed Growth Fund
The Fund may "[n]ot invest in commodities, except that the Fund may purchase and
sell futures contracts and related options to the extent that total initial
margin and premiums on the contracts do not exceed 5% of its total assets."
2
EXHIBIT 6
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO INVESTMENTS IN REAL
ESTATE
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "purchase or sell real estate (other than Municipal Securities
or money market securities secured by real estate or interests therein or such
securities issued by companies which invest in real estate or interests
therein)."
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[p]urchase or sell real estate or interests in real estate
limited partnerships (other than securities secured by real estate or interests
therein), interests in oil, gas or mineral leases, commodities or commodity
contracts in the ordinary course of business (the Fund reserves the freedom of
action to hold and to sell real estate acquired as a result of the ownership of
securities and to enter into futures and options transactions in accordance with
its investment policies)."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[p]urchase or sell real estate or real estate limited
partnerships interests, or invest in oil, gas or mineral leases, or mineral
exploration or development programs, except that the Fund may invest in
securities secured by real estate, mortgages or interests therein and may
purchase securities issued by companies that invest or deal in any of the
above."
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
1
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[p]urchase or sell real estate, except that the Fund may
purchase securities of issuers which deal or invest in real estate and may
purchase securities which are secured by real estate or interests in real
estate."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "purchase or sell real estate (although it may purchase
securities secured by real estate or interests therein, or securities issued by
companies which invest in real estate, or interests therein)."
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
2
The Fund may "[o]nly own real estate acquired as the result of owning securities
and not more than 5% of total assets."
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "purchase or sell real estate (although it may purchase
securities secured by real estate or interests therein, or securities issued by
companies which invest in real estate or interests therein), commodities, or
commodity contracts, [(]except that it may enter into (a) futures and options on
futures and (b) forward contracts.[)]"
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
The Fund may "[i]nvest up to 5% of its net assets in real estate as a result of
owning securities (i.e., foreclosing and collateral)."
3
EXHIBIT 7
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO UNDERWRITING OF
SECURITIES
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust V
Columbia Intermediate Tax-Exempt Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[u]nderwrite securities of other issuers, except insofar as
the Fund technically may be deemed to be an underwriter under the Securities Act
of 1933 in connection with the purchase and sale of its portfolio securities."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "act as an underwriter of securities, except insofar as it may
be deemed to be an "underwriter" for purposes of the Securities Act of 1933 on
disposition of securities acquired subject to legal or contractual restrictions
on resale, except that all or substantially all of the assets of the Fund may be
invested in another registered investment company having the
1
same investment objective and substantially similar investment policies as the
Fund."
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "act as an underwriter of securities, except that it may
participate as part of a group in bidding, or bid alone, for the purchase of
Municipal Securities directly from an issuer for its own portfolio."
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
The Fund may "[u]nderwrite securities issued by others [only][except] when
disposing of portfolio securities."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[u]nderwrite any issue of securities except to the extent that
the sale of portfolio securities in accordance with the Fund's investment
objective, policies and limitations may be deemed to be underwriting."
2
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[u]nderwrite securities issued by other persons, except
insofar as the Fund may technically be deemed an underwriter under the
Securities Act of 1933 in selling a security and except that the Fund may invest
all or substantially all of its assets in another registered investment company
having substantially the same investment objective as the Fund."
3
EXHIBIT 8
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO PURCHASING
SECURITIES ON MARGIN
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Columbia Utilities Fund
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
The Fund may "[p]urchase and sell futures contracts and related options so long
as the total initial margin and premiums [on the contracts] do not exceed 5% of
[its] total assets."
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[p]urchase any security on margin, except that the Fund may
obtain such short-term credit as may be necessary for the clearance of purchases
and sales of securities (this restriction does not apply to securities purchased
on a when-issued basis or to margin deposits in connection with futures and
options transactions)."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[p]urchase securities on margin, except that a Fund may obtain
any short-term credits necessary for the clearance of purchases and sales of
securities. For purposes of this restriction, the deposit or payment of initial
or variation margin in connection with futures contracts or related options will
not be deemed to be a purchase of securities on margin by the Fund."
1
EXHIBIT 9
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO INVESTING FOR THE
PURPOSE OF EXERCISING CONTROL
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[p]urchase more than 10% of the voting securities of any one
issuer, more than 10% of the securities of any class of any one issuer or more
than 10% of the outstanding debt securities of any one issuer; provided that
this limitation shall not apply to investments in U.S. Government securities."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "invest in a security if, as a result of such investment, it
would hold more than 10% (taken at the time of such investment) of the
outstanding voting securities of any one issuer, except that all or
substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
substantially similar investment policies as the Fund."
Series of Columbia Funds Trust III
Columbia Global Equity Fund
The Fund may not "[p]urchase the securities of any one issuer (except securities
issued or guaranteed by the U.S. government and its agencies or
instrumentalities, as to which there are no percentage limits or restrictions)
if immediately after and as a result of such purchase (a) more than 5% of the
value of its assets would be invested in that issuer, or (b) the Fund would hold
more than 10% of the outstanding voting securities of that issuer and except
that the Fund may invest all or substantially all of its assets in another
registered investment company having substantially the same investment objective
as the Fund."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[i]nvest in companies for the purpose of exercising control or
management."
1
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "acquire more than 10%, taken at the time of a particular
purchase, of the outstanding voting securities of any one issuer, except that
all or substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
substantially similar investment policies as the Fund."
2
EXHIBIT 10
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO CONCENTRATING
INVESTMENTS
IN AN INDUSTRY
Series of Columbia Funds Trust III
Columbia Quality Plus Bond Fund
Series of Columbia Funds Trust XI
Columbia Asset Allocation Fund
Columbia Dividend Income Fund
Columbia Large Cap Core Fund
Columbia Large Cap Growth Fund
Columbia Disciplined Value Fund
Columbia Small Cap Fund
Columbia Small Company Equity Fund
The Fund may not "[c]oncentrate its investments in the securities of one or more
issuers conducting their principal business activities in the same industry
(other than securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities)."
Series of Columbia Funds Trust IX
Columbia High Yield Municipal Fund
The Fund may not "invest more than 25% of its total assets (taken at market
value at the time of each investment) in securities of non-governmental issuers
whose principal business activities are in the same industry, except that all or
substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
substantially similar investment policies as the Fund."
Series of Columbia Funds Trust V
Columbia Connecticut Intermediate Municipal Bond Fund
Columbia New Jersey Intermediate Municipal Bond Fund
Columbia New York Intermediate Municipal Bond Fund
Columbia Rhode Island Intermediate Municipal Bond Fund
Columbia Massachusetts Intermediate Municipal Bond Fund
Columbia Intermediate Tax-Exempt Bond Fund
The Fund may not "[c]oncentrate its investments in the securities of one or more
issuers conducting their principal business activities in the same
1
industry (other than (a) securities issued or guaranteed by the U.S. Government,
any state, territory or possession of the U.S. Government, the District of
Columbia, or any of their authorities, agencies, instrumentalities or political
subdivisions, and (b) with respect to the Florida Fund, investment of all the
investable assets of the fund in a Qualifying Portfolio (i.e., a diversified,
open-end management investment company having the same investment goal and
policies and substantially the same investment restrictions as those applicable
to the Fund))."
Series of Columbia Funds Trust VIII
Columbia Income Fund
Columbia Intermediate Bond Fund
The Fund may not "invest in a security if, as a result of such investment, more
than 25% of its total assets (taken at market value at the time of each
investment) would be invested in the securities of issuers in any particular
industry, except that this restriction does not apply to (i) repurchase
agreements, or (ii) securities of issuers in the financial services industry,
and except that all or substantially all of the assets of the Fund may be
invested in another registered investment company having the same investment
objective and substantially similar investment policies as the Fund."
Series of Columbia Funds Trust I
Columbia High Yield Opportunity Fund
Columbia Strategic Income Fund
Columbia Tax-Managed Growth Fund
Series of Columbia Funds Trust III
Columbia Liberty Fund
Columbia Federal Securities Fund
Series of Columbia Funds Trust IV
Columbia Tax-Exempt Fund
Columbia Tax-Exempt Insured Fund
Series of Columbia Funds Trust VI
Columbia Small Cap Value Fund
The Fund may "[n]ot concentrate more than 25% of its total assets in any one
industry or with respect to 75% of total assets purchase any security (other
than obligations of the U.S. government and cash items including receivables) if
as a result more than 5% of its total assets would then be invested in
securities of a single issuer, or purchase the voting securities of
2
an issuer if, as a result of [such] purchase[s], the Fund would own more than
10% of the outstanding voting shares of such issuer."
Series of Columbia Funds Trust V
Columbia U.S. Treasury Index Fund
The Fund may not "[p]urchase any securities that would cause 25% or more of the
value of the Fund's total assets at the time of purchase to be invested in the
securities of issuers conducting their principal business activities in the same
industry, provided that there shall be no limit on the purchase of U.S.
Government securities."
Series of Columbia Funds Trust V
Columbia California Tax-Exempt Fund
Columbia Connecticut Tax-Exempt Fund
Columbia Massachusetts Tax-Exempt Fund
Columbia New York Tax-Exempt Fund
The Fund may "[n]ot concentrate more than 25% of its total assets in any one
industry."
Series of Columbia Funds Trust XI
Columbia Young Investor Fund
Columbia Growth Stock Fund
The Fund may not "invest in a security if more than 25% of its total assets
(taken at market value at the time of a particular purchase) would be invested
in the securities of issuers in any particular industry, except that this
restriction does not apply to securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities, and except that all or
substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
substantially similar investment policies as the Fund."
3
EXHIBIT 11
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION dated as of , 2005, is by
and among (the "Acquired Trust"), a Massachusetts business trust, on
behalf of (the "Acquired Fund"); (the "Acquiring Trust"), a
Massachusetts business trust on behalf of (the "Acquiring Fund"); and
Columbia Management Advisors, Inc. ("Columbia").
This Agreement is intended to be and is adopted as a plan of reorganization and
liquidation within the meaning of Sections 361(a) and Section 368(a) of the
United States Internal Revenue Code of 1986, as amended (the "Code"), and any
successor provision. The reorganization will consist of the transfer of all of
the assets of the Acquired Fund attributable to each class of its shares in
exchange for shares of the same class of shares of the Acquiring Fund (the
"Acquisition Shares"), and the assumption by the Acquiring Fund of the
liabilities of the Acquired Fund and the distribution of the Acquisition Shares
to the relevant shareholders of the Acquired Fund in liquidation of the Acquired
Fund, all upon the terms and conditions set forth in this Agreement.
In consideration of the premises and of the covenants and agreements hereinafter
set forth, the parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS OF ACQUIRED FUND IN EXCHANGE FOR ASSUMPTION OF
LIABILITIES AND ACQUISITION SHARES AND LIQUIDATION OF ACQUIRED FUND.
1.1. Subject to the terms and conditions herein set forth and on the basis
of the representations and warranties contained herein,
(a) The Acquired Fund will transfer and deliver to the Acquiring Fund,
and the Acquiring Fund will acquire, all the assets of the Acquired
Fund as set forth in paragraph 1.2;
(b) The Acquiring Fund will assume all of the Acquired Fund's
liabilities and obligations of any kind whatsoever, whether
absolute, accrued, contingent or otherwise, in existence on the
Closing Date (as defined in paragraph 1.2 hereof) (the
"Obligations"); and
(c) The Acquiring Fund will issue and deliver to the Acquired Fund in
exchange for the net assets attributable to each class of its shares
the number of Acquisition Shares of the
1
corresponding class (including fractional shares, if any) determined
by dividing the value of such net assets, computed in the manner and
as of the time and date set forth in paragraph 2.1, by the net asset
value of one Acquisition Share of the applicable class computed in
the manner and as of the time and date set forth in paragraph 2.2.
Such transactions shall take place at the closing provided for in
paragraph 3.1 (the "Closing").
1.2 The assets of the Acquired Fund to be acquired by the Acquiring Fund
shall consist of all cash, securities, dividends and interest
receivable, receivables for shares sold and all other assets which are
owned by the Acquired Fund on the closing date provided in paragraph
3.1 (the "Closing Date") and any deferred expenses, other than
unamortized organizational expenses, shown as an asset on the books of
the Acquired Fund on the Closing Date. The Acquiring Fund agrees that
all rights to indemnification and all limitations of liability
existing in favor of the Acquired Fund's current and former Trustees
and officers, acting in their capacities as such, under the Acquired
Fund's organizational documents as in effect as of the date of this
Agreement shall survive the reorganization as obligations of the
Acquiring Fund and shall continue in full force and effect, without
any amendment thereto, and shall constitute rights which may be
asserted against the Acquiring Fund, its successors or assigns.
1.3 As provided in paragraph 3.4, as soon after the Closing Date as is
conveniently practicable (the "Liquidation Date"), the Acquired Fund
will liquidate and distribute pro rata to shareholders of record of
each class of shares, determined as of the close of business on the
Valuation Date (as defined in paragraph 2.1), the Acquisition Shares
of the relevant class received by the Acquired Fund pursuant to
paragraph 1.1. Such liquidation and distribution will be accomplished
by the transfer of the Acquisition Shares then credited to the account
of the Acquired Fund on the books of the Acquiring Fund to open
accounts on the share records of the Acquiring Fund in the names of
the Acquired Fund shareholders and representing the respective pro
rata number of Acquisition Shares due such shareholders. The Acquiring
Fund shall not be obligated to issue certificates representing
Acquisition Shares in connection with such exchange.
1.4 With respect to Acquisition Shares distributable pursuant to paragraph
1.3 to an Acquired Fund shareholder holding a
2
certificate or certificates for shares of the Acquired Fund, if any,
on the Valuation Date, the Acquired Fund will not permit such
shareholder to receive Acquisition Share certificates therefor,
exchange such Acquisition Shares for shares of other investment
companies, effect an account transfer of such Acquisition Shares, or
pledge or redeem such Acquisition Shares until such Acquired Fund
shareholder has surrendered all his or her outstanding certificates
for Acquired Fund shares or, in the event of lost certificates, posted
adequate bond.
1.5 If applicable, as soon as practicable after the Closing Date, the
Acquired Trust shall file an application pursuant to Section 8(f) of
the Investment Company Act of 1940, as amended (the "1940 Act"), for
an order declaring that it has ceased to be an investment company and,
upon receipt of such order, shall make all filings and take all other
steps as shall be necessary and proper to effect its complete
termination under Massachusetts law. After the Closing Date, the
Acquired Fund shall not conduct any business except in connection with
its liquidation, deregistration (if applicable), and termination.
2. VALUATION.
2.1 For the purpose of paragraph 1, the value of the Acquired Fund's
assets to be acquired by the Acquiring Fund hereunder shall be the
value of such assets computed as of the close of regular trading on
the New York Stock Exchange on the business day next preceding the
Closing (such time and date being herein called the "Valuation Date")
using the valuation procedures set forth in the organizational
documents of the Acquiring Fund and the then current prospectus or
prospectuses or statement or statements of additional information of
the Acquiring Fund (collectively, as amended or supplemented from time
to time, the "Acquiring Fund Prospectus") for determining net asset
value, [after deduction for the expenses of the reorganization
contemplated hereby to be paid by the Acquired Fund pursuant to
paragraph 9.2, and shall be certified by the Acquired Fund.]
2.2 For the purpose of paragraph 2.1, the net asset value of an
Acquisition Share of each class shall be the net asset value per share
computed as of the close of regular trading on the New York Stock
Exchange on the Valuation Date, using the valuation procedures set
forth in the organizational documents of the Acquiring Fund and the
Acquiring Fund Prospectus.
3
3. CLOSING AND CLOSING DATE.
3.1 The Closing Date shall be on , 2005, or on such other date
as the parties may agree. The Closing shall be held at p.m. at
Columbia's offices, One Financial Center, Boston, Massachusetts 02111,
or at such other time and/or place as the parties may agree.
3.2 The portfolio securities of the Acquired Fund shall be made available
by the Acquired Fund to the custodian for the Acquiring Fund (the
"Custodian"), for examination no later than five business days
preceding the Valuation Date. On the Closing Date, such portfolio
securities and all the Acquired Fund's cash shall be delivered by the
Acquired Fund to the Custodian for the account of the Acquiring Fund,
such portfolio securities to be duly endorsed in proper form for
transfer in such manner and condition as to constitute good delivery
thereof in accordance with the custom of brokers or, in the case of
portfolio securities held in the U.S. Treasury Department's book-entry
system or by the Depository Trust Company, Participants Trust Company
or other third party depositories, by transfer to the account of the
Custodian in accordance with Rule 17f-4, Rule 17f-5 or Rule 17f-7, as
the case may be, under the 1940 Act and accompanied by all necessary
federal and state stock transfer stamps or a check for the appropriate
purchase price thereof. The cash delivered shall be in the form of
currency or certified or official bank checks, payable to the order of
"[Name of Custodian], custodian for [Name of Acquiring Fund]."
3.3 In the event that on the Valuation Date (a) the New York Stock
Exchange shall be closed to trading or trading thereon shall be
restricted, or (b) trading or the reporting of trading on said
Exchange or elsewhere shall be disrupted so that accurate appraisal of
the value of the net assets of the Acquired Fund or the Acquiring Fund
is impracticable, the Closing Date shall be postponed until the first
business day after the day when trading shall have been fully resumed
and reporting shall have been restored; provided that if trading shall
not be fully resumed and reporting restored within three business days
of the Valuation Date, this Agreement may be terminated by either the
Acquired Fund or the Acquiring Fund upon the giving of written notice
to the other party.
3.4 At the Closing, the Acquired Fund or its transfer agent shall deliver
to the Acquiring Fund or its designated agent a list of the
4
names and addresses of the Acquired Fund shareholders and the number
of outstanding shares of each class of the Acquired Fund owned by each
Acquired Fund shareholder, all as of the close of business on the
Valuation Date, certified by any Vice President, Secretary or
Assistant Secretary of the Acquired Fund. The Trust will provide to
the Acquired Fund evidence satisfactory to the Acquired Fund that the
Acquisition Shares issuable pursuant to paragraph 1.1 have been
credited to the Acquired Fund's account on the books of the Acquiring
Fund. On the Liquidation Date, the Acquiring Fund will provide to the
Acquired Fund evidence satisfactory to the Acquired Fund that such
Acquisition Shares have been credited pro rata to open accounts in the
names of the Acquired Fund shareholders as provided in paragraph 1.3.
3.5 At the Closing, each party shall deliver to the other such bills of
sale, instruments of assumption of liabilities, checks, assignments,
stock certificates, receipts or other documents as such other party or
its counsel may reasonably request in connection with the transfer of
assets, assumption of liabilities and liquidation contemplated by
paragraph 1.
4. REPRESENTATIONS AND WARRANTIES.
4.1 The Acquired Fund represents and warrants the following to the
Acquiring Fund as of the date hereof and agrees to confirm the
continuing accuracy and completeness in all material respects of the
following on the Closing Date:
(a) The Acquired Fund is a series of the Acquired Trust that is duly
organized, validly existing and in good standing under the laws of
The Commonwealth of Massachusetts;
(b) The Acquired Trust is a duly registered investment company
classified as a management company of the open-end type and its
registration with the Securities and Exchange Commission as an
investment company under the 1940 Act is in full force and effect,
and the Acquired Fund is a separate series thereof duly designated
in accordance with the applicable provisions of the Declaration of
Trust of the Acquired Trust and the 1940 Act;
(c) The Acquired Fund is not in violation in any material respect of any
provision of its organizational documents or of any agreement,
indenture, instrument, contract, lease or other undertaking to which
the Acquired Fund is a party or by which the Acquired Fund is bound,
and the execution,
5
delivery and performance of this Agreement will not result in any
such violation;
(d) The Acquired Fund has no material contracts or other commitments
(other than this Agreement and such other contracts as may be
entered into in the ordinary course of its business) which if
terminated may result in material liability to the Acquired Fund or
under which (whether or not terminated) any material payments for
periods subsequent to the Closing Date will be due from the Acquired
Fund;
(e) To the knowledge of the Acquired Fund, except as has been disclosed
in writing to the Acquiring Fund, no litigation or administrative
proceeding or investigation of or before any court or governmental
body is presently pending or threatened as to the Acquired Fund, any
of its properties or assets, or any person whom the Acquired Fund
may be obligated to indemnify in connection with such litigation,
proceeding or investigation, and is not a party to or subject to the
provisions of any order, decree or judgment of any court or
governmental body, which materially and adversely affects its
business or its ability to consummate the transactions contemplated
hereby;
(f) The statement of assets and liabilities, the statement of
operations, the statement of changes in net assets, and the schedule
of investments of the Acquired Fund, as of and for its most recently
completed fiscal year, audited by PricewaterhouseCoopers LLP (and,
if applicable, an unaudited statement of assets and liabilities,
statement of operations, statement of changes in net assets and
schedule of investments for any subsequent semiannual period
following the most recently completed fiscal year), copies of which
have been furnished to the Acquiring Fund, fairly reflect the
financial condition and results of operations of the Acquired Fund
as of such dates and for the periods then ended in accordance with
generally accepted accounting principles consistently applied, and
the Acquired Fund has no known liabilities of a material amount,
contingent or otherwise, other than those shown on the statements of
assets referred to above or those incurred in the ordinary course of
its business since the date of the Acquired Fund's most recently
completed fiscal year;
6
(g) Since the date of the Acquired Fund's most recently completed fiscal
year, there has not been any material adverse change in the Acquired
Fund's financial condition, assets, liabilities or business (other
than changes occurring in the ordinary course of business), or any
incurrence by the Acquired Fund of indebtedness, except as disclosed
in writing to the Acquiring Fund. For the purposes of this
subparagraph (g), distributions of net investment income and net
realized capital gains, changes in portfolio securities, changes in
the market value of portfolio securities or net redemptions shall be
deemed to be in the ordinary course of business;
(h) As of the Closing Date, all federal and other tax returns and
reports of the Acquired Fund required by law to have been filed by
such date (giving effect to extensions) shall have been filed, and
all federal and other taxes shown to be due on such returns and
reports or on any assessment received shall have been paid, or
provisions shall have been made for the payment thereof. All of the
Acquired Fund's tax liabilities will have been adequately provided
for on its books. To the best of the Acquired Fund's knowledge, it
will not have had any tax deficiency or liability asserted against
it or question with respect thereto raised, and it will not be under
audit by the Internal Revenue Service or by any state or local tax
authority for taxes in excess of those already paid;
(i) The Acquired Fund meets the requirements of subchapter M of the Code
for treatment as a "regulated investment company" within the meaning
of Section 851 of the Code, and will continue meeting such
requirements at all times through the Closing Date. The Acquired
Fund has not at any time since its inception been liable for nor is
now liable for any material income or excise tax pursuant to Section
852 or 4982 of the Code. The Acquired Fund has duly filed all
federal, state, local and foreign tax returns which are required to
have been filed, and all taxes of the Acquired Fund which are due
and payable have been paid except for amounts that alone or in the
aggregate would not reasonably be expected to have a material
adverse effect. The Acquired Fund is in compliance in all material
respects with applicable regulations of the Internal Revenue Service
pertaining to the reporting of dividends and other distributions on
and redemptions of its capital stock and to withholding in respect
7
of dividends and other distributions to shareholders, and is not
liable for any material penalties which could be imposed thereunder;
(j) Exhibit A attached hereto sets forth the authorized capital of the
Acquired Fund. All issued and outstanding shares of the Acquired
Fund are, and at the Closing Date will be, duly and validly issued
and outstanding, fully paid and non-assessable (except as set forth
in the Acquired Fund's then current prospectus or prospectuses or
statement or statements of additional information (collectively, as
amended or supplemented from time to time, the "Acquired Fund
Prospectus")) by the Acquired Fund and will have been issued in
compliance with all applicable registration or qualification
requirements of federal and state securities laws. Except as set
forth on Exhibit A attached hereto, no options, warrants or other
rights to subscribe for or purchase, or securities convertible into,
any shares of common stock of the Acquired Fund are outstanding and
none will be outstanding on the Closing Date;
(k) The Acquired Fund's investment operations from inception to the date
hereof have been in compliance in all material respects with the
investment policies and investment restrictions set forth in the
Acquired Fund Prospectus, except as previously disclosed in writing
to the Acquiring Fund;
(l) The execution, delivery and performance of this Agreement has been
duly authorized by the Trustees of the Acquired Fund, and, upon
approval thereof by the required majority of the shareholders of the
Acquired Fund, this Agreement will constitute the valid and binding
obligation of the Acquired Fund enforceable in accordance with its
terms except as the same may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally and other equitable principles;
(m) The Acquisition Shares to be issued to the Acquired Fund pursuant to
paragraph 1 will not be acquired for the purpose of making any
distribution thereof other than to the Acquired Fund shareholders as
provided in paragraph 1.3;
(n) The information provided by the Acquired Fund for use in the Proxy
Statement referred to in paragraph 5.3 shall be
8
accurate and complete in all material respects and shall comply with
federal securities and other laws and regulations as applicable
thereto;
(o) No consent, approval, authorization or order of any court or
governmental authority is required for the consummation by the
Acquired Fund of the transactions contemplated by this Agreement,
except such as may be required under the Securities Act of 1933, as
amended (the "1933 Act"), the Securities Exchange Act of 1934, as
amended (the "1934 Act"), the 1940 Act and state securities or "Blue
Sky" laws (which terms used herein shall include the laws of the
District of Columbia and of Puerto Rico);
(p) At the Closing Date, the Acquired Fund will have good and marketable
title to its assets to be transferred to the Acquiring Fund pursuant
to paragraph 1.1 and will have full right, power and authority to
sell, assign, transfer and deliver the Investments (as defined
below) and any other assets and liabilities of the Acquired Fund to
be transferred to the Acquiring Fund pursuant to this Agreement. At
the Closing Date, subject only to the delivery of the Investments
and any such other assets and liabilities and payment therefor as
contemplated by this Agreement, the Acquiring Fund will acquire good
and marketable title thereto and will acquire the Investments and
any such other assets and liabilities subject to no encumbrances,
liens or security interests whatsoever and without any restrictions
upon the transfer thereof, except as previously disclosed to the
Acquiring Fund. As used in this Agreement, the term "Investments"
shall mean the Acquired Fund's investments shown on the schedule of
its investments as of the date of its most recently completed fiscal
year, referred to in subparagraph 4.1(f) hereof, as supplemented
with such changes in the portfolio as the Acquired Fund shall make,
and changes resulting from stock dividends, stock split-ups, mergers
and similar corporate actions through the Closing Date;
(q) Reserved;
(r) No registration of any of the Investments would be required if they
were, as of the time of such transfer, the subject of a public
distribution by either of the Acquiring Fund or the Acquired Fund,
except as previously disclosed by the Acquired Fund to the Acquiring
Fund.
9
4.2 The Acquiring Fund represents and warrants the following to the
Acquired Fund as of the date hereof and agrees to confirm the
continuing accuracy and completeness in all material respects of the
following on the Closing Date:
(a) The Acquiring Fund is a series of the Acquiring Trust that is duly
organized, validly existing and in good standing under the laws of
The Commonwealth of Massachusetts;
(b) The Acquiring Trust is a duly registered investment company
classified as a management company of the open-end type and its
registration with the Securities and Exchange Commission as an
investment company under the 1940 Act is in full force and effect,
and the Acquiring Fund is a separate series thereof duly designated
in accordance with the applicable provisions of the Declaration of
Trust of the Acquiring Trust and the 1940 Act;
(c) At the Closing Date, the Acquiring Fund Prospectus will conform in
all material respects to the applicable requirements of the 1933 Act
and the rules and regulations of the Securities and Exchange
Commission thereunder and will not include any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, and
there will be no material contracts to which the Acquiring Fund is a
party that are not referred to in such Prospectus or in the
registration statement of which it is a part;
(d) At the Closing Date, the Acquiring Fund will have good and
marketable title to its assets;
(e) The Acquiring Fund is not in violation in any material respect of
any provisions of its organizational documents or of any agreement,
indenture, instrument, contract, lease or other undertaking to which
the Acquiring Fund is a party or by which the Acquiring Fund is
bound, and the execution, delivery and performance of this Agreement
will not result in any such violation;
(f) To the knowledge of such counsel, except as has been disclosed in
writing to the Acquired Fund, no litigation or administrative
proceeding or investigation of or before any court or governmental
body is presently pending or
10
threatened as to the Acquiring Fund, any of its properties or
assets, or any person whom the Acquiring Fund may be obligated to
indemnify in connection with such litigation, proceeding or
investigation, and the Acquiring Fund is not a party to or subject
to the provisions of any order, decree or judgment of any court or
governmental body which materially and adversely affects its
business or its ability to consummate the transactions contemplated
hereby;
(g) Reserved;
(h) Reserved;
(i) As of the Closing Date, the Acquiring Fund shall have not been
required by law to have filed any federal or other tax returns or
reports. All of the Acquiring Fund's tax liabilities, if any, will
have been adequately provided for on its books. To the best of the
Acquiring Fund's knowledge, it will not have not have had any tax
deficiency or liability asserted against it or question with respect
thereto raised, and it will not be under audit by the Internal
Revenue Service or by any state or local tax authority for taxes in
excess of those already paid;
(j) The Acquiring Fund was established by the Trustees of the Acquiring
Trust in order to effect the transactions described in this
Agreement. It has not yet filed its first federal income tax return
and, thus, has not yet elected to be treated as a "regulated
investment company" for federal income tax purposes. However, upon
filing its first income tax return at the completion of its first
taxable year, the Acquiring Fund will elect to be a "regulated
investment company" and until such time will take all steps
necessary to ensure that it qualifies for taxation as a "regulated
investment company" under Sections 851 and 852 of the Code.
(k) The Acquiring Fund has no shares of beneficial interest issued and
outstanding;
(l) Reserved;
(m) The execution, delivery and performance of this Agreement have been
duly authorized by all necessary action on the part of the Acquiring
Fund, and this Agreement constitutes the valid and binding
obligation of the Acquiring Fund enforceable in accordance with its
terms, except as the same
11
may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights
generally and other equitable principles;
(n) The Acquisition Shares to be issued and delivered to the Acquired
Fund pursuant to the terms of this Agreement will at the Closing
Date have been duly authorized and, when so issued and delivered,
will be duly and validly issued shares in the Acquiring Fund, and
will be fully paid and non-assessable (except as set forth in the
Acquiring Fund Prospectus) by the Acquiring Fund, and no shareholder
of the Acquiring Fund will have any preemptive right of subscription
or purchase in respect thereof;
(o) The information to be furnished by the Acquiring Fund for use in the
Proxy Statement referred to in paragraph 5.3 shall be accurate and
complete in all material respects and shall comply with federal
securities and other laws and regulations applicable thereto; and
(p) No consent, approval, authorization or order of any court or
governmental authority is required for the consummation by the
Acquiring Fund of the transactions contemplated by this Agreement,
except such as may be required under the 1933 Act, the 1934 Act, the
1940 Act and state securities or "Blue Sky" laws (which term as used
herein shall include the laws of the District of Columbia and of
Puerto Rico).
5. COVENANTS OF THE ACQUIRED FUND AND THE ACQUIRING FUND.
The Acquired Fund and the Acquiring Fund each hereby covenants and agrees with
the other as follows:
5.1 Each of the Acquiring Fund and the Acquired Fund each will operate its
business in the ordinary course between the date hereof and the
Closing Date, it being understood that such ordinary course of
business will include regular and customary periodic dividends and
distributions.
5.2 The Acquired Fund will call a meeting of its shareholders to be held
prior to the Closing Date to elect the Board of Trustees of the
Acquired Fund and take all other reasonable action necessary to obtain
the required shareholder approval of the transactions contemplated
hereby.
5.3 In connection with the Acquired Fund shareholders' meeting referred to
in paragraph 5.2, the Acquired Fund will prepare a
12
Proxy Statement for such meeting, to be distributed to the Acquired
Fund shareholders pursuant hereto, all in compliance with the
applicable requirements of the 1934 Act and the 1940 Act.
5.4 The information to be furnished by the Acquired Fund and the Acquiring
Fund for use in the Proxy Statement, as referred to in paragraph 5.3,
shall be accurate and complete in all material respects and shall
comply with federal securities and other laws and regulations
thereunder applicable thereto.
5.5 The Acquiring Fund will advise the Acquired Fund promptly if at any
time prior to the Closing Date the assets of the Acquired Fund include
any securities which the Acquiring Fund is not permitted to acquire.
5.6 Subject to the provisions of this Agreement, the Acquired Fund and the
Acquiring Fund will each take, or cause to be taken, all action, and
do or cause to be done, all things reasonably necessary, proper or
advisable to cause the conditions to the other party's obligations to
consummate the transactions contemplated hereby to be met or fulfilled
and otherwise to consummate and make effective such transactions.
5.7 The Acquiring Fund will use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act
and such of the state securities or "Blue Sky" laws as it may deem
appropriate in order to continue its operations after the Closing
Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND.
The obligations of the Acquired Fund to consummate the transactions provided for
herein shall be subject, at its election, to the performance by the Acquiring
Fund of all the obligations to be performed by them hereunder on or before the
Closing Date and, in addition thereto, to the following further conditions:
6.1 The Acquiring Fund shall have delivered to the Acquired Fund, a
certificate executed in its name by its President or a Vice President
and its Treasurer or an Assistant Treasurer, in form and substance
satisfactory to the Acquired Fund and dated as of the Closing Date, to
the effect that the representations and warranties of the Acquiring
Fund made in this Agreement are true and correct at and as of the
Closing Date, except as they may be
13
affected by the transactions contemplated by this Agreement, and that
the Acquiring Fund has complied with all the covenants and agreements
and satisfied all of the conditions on their parts to be performed or
satisfied under this Agreement at or prior to the Closing Date.
6.2 The Acquired Fund shall have received a favorable opinion of Ropes &
Gray LLP dated the Closing Date and, in a form satisfactory to the
Acquiring Fund, to the following effect:
(a) The Acquiring Trust is duly organized and validly existing under the
laws of The Commonwealth of Massachusetts and has power to own all
of its properties and assets and to carry on its business as
presently conducted;
(b) This Agreement has been duly authorized, executed and delivered on
behalf of the Acquiring Fund and, assuming the Proxy Statement
referred to in paragraph 5.3 complies with applicable federal
securities laws and assuming the due authorization, execution and
delivery of this Agreement by the Acquired Fund is the valid and
binding obligation of the Acquiring Fund enforceable against the
Acquiring Fund in accordance with its terms, except as the same may
be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights
generally and other equitable principles;
(c) The Acquiring Fund has the power to assume the liabilities to be
assumed by it hereunder and upon consummation of the transactions
contemplated hereby the Acquiring Fund will have duly assumed such
liabilities;
(d) The Acquisition Shares to be issued for transfer to the Acquired
Fund shareholders as provided by this Agreement are duly authorized
and upon such transfer and delivery will be validly issued and
outstanding and fully paid and nonassessable shares in the Acquiring
Fund, and no shareholder of the Acquiring Fund has any preemptive
right of subscription or purchase in respect thereof;
(e) The execution and delivery of this Agreement did not, and the
performance by the Acquiring Fund of its obligations hereunder will
not, violate the Acquiring Fund's organizational documents, or any
provision of any agreement known to such counsel to which the
Acquiring Fund is a party or by which it is bound or, to the
knowledge of such
14
counsel, result in the acceleration of any obligation or the
imposition of any penalty under any agreement, judgment, or decree
to which the Acquiring Fund is a party or by which it is bound;
(f) To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by the Acquiring Fund of the
transactions contemplated by this Agreement except such as may be
required under state securities or "Blue Sky" laws or such as have
been obtained;
(g) Such counsel does not know of any legal or governmental proceedings
relating to the Acquiring Fund existing on or before the date of
mailing of the Proxy Statement referred to in paragraph 5.3 or the
Closing Date required to be described in the Proxy Statement which
are not described as required;
(h) The Acquiring Trust is registered with the Securities and Exchange
Commission as an investment company under the 1940 Act; and
(i) To the knowledge of such counsel, except as has been disclosed in
writing to the Acquired Fund, no litigation or administrative
proceeding or investigation of or before any court or governmental
body is presently pending or threatened as to the Acquiring Fund or
any of its properties or assets or any person whom the Acquired Fund
may be obligated to indemnify in connection with such litigation,
proceeding or investigation, and the Acquiring Fund is not a party
to or subject to the provisions of any order, decree or judgment of
any court or governmental body, which materially and adversely
affects its business or its ability to consummate the transaction
contemplated hereby.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND.
The obligations of the Acquiring Fund to complete the transactions provided for
herein shall be subject, at its election, to the performance by the Acquired
Fund of all the obligations to be performed by it hereunder on or before the
Closing Date and, in addition thereto, to the following further conditions:
7.1 The Acquired Fund shall have delivered to the Acquiring Fund a
certificate executed in its name by its President or a Vice
15
President and its Treasurer or an Assistant Treasurer, in form and
substance satisfactory to the Acquiring Fund and dated as of the
Closing Date, to the effect that the representations and warranties of
the Acquired Fund made in this Agreement are true and correct at and
as of the Closing Date, except as they may be affected by the
transactions contemplated by this Agreement, and that the Acquired
Fund have complied with all the covenants and agreements and satisfied
all of the conditions on their parts to be performed or satisfied
under this Agreement at or prior to the Closing Date;
7.2 The Acquiring Fund shall have received a favorable opinion of Ropes &
Gray LLP, dated the Closing Date and in a form satisfactory to the
Acquiring Fund, to the following effect:
(a) The Acquired Trust is duly organized and validly existing under the
laws of The Commonwealth of Massachusetts and has power to own all
of its properties and assets and to carry on its business as
presently conducted;
(b) This Agreement has been duly authorized, executed and delivered on
behalf of the Acquired Fund and, assuming the Proxy Statement
referred to in paragraph 5.3 comply with applicable federal
securities laws and, assuming the due authorization, execution and
delivery of this Agreement by the Acquiring Fund, is the valid and
binding obligation of the Acquired Fund enforceable against the
Acquired Fund in accordance with its terms, except as the same may
be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights
generally and other equitable principles;
(c) The Acquired Fund has the power to sell, assign, transfer and
deliver the assets to be transferred by it hereunder, and, upon
consummation of the transactions contemplated hereby, the Acquired
Fund will have duly transferred such assets to the Acquiring Fund;
(d) The execution and delivery of this Agreement did not, and the
performance by the Acquired Fund of its respective obligations
hereunder will not, violate the Acquired Fund's organizational
documents or any provision of any agreement known to such counsel to
which the Acquired Fund is a party or by which it is bound or, to
the knowledge of such counsel, result in the acceleration of any
obligation or the imposition
16
of any penalty under any agreement, judgment, or decree to which the
Acquired Fund is a party or by which it is bound;
(e) To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by the Acquired Fund of the
transactions contemplated by this Agreement, except such as have
been obtained;
(f) Such counsel does not know of any legal or governmental proceedings
relating to the Acquired Fund existing on or before the date of
mailing of the Proxy Statement referred to in paragraph 5.3 or the
Closing Date required to be described in the Proxy Statement which
are not described as required;
(g) The Acquired Trust is registered with the Securities and Exchange
Commission as an investment company under the 1940 Act; and
(h) To the knowledge of such counsel, except as has been disclosed in
writing to the Acquiring Fund, no litigation or administrative
proceeding or investigation of or before any court or governmental
body is presently pending or threatened as to the Acquired Fund or
any of its properties or assets or any person whom the Acquiring
Fund may be obligated to indemnify in connection with such
litigation, proceeding or investigation, and the Acquired Fund is
not a party to or subject to the provisions of any order, decree or
judgment of any court or governmental body, which materially and
adversely affects its business or its ability to consummate the
transaction contemplated thereby.
7.3 Reserved.
7.4 The Acquired Fund shall have furnished to the Acquiring Fund a
certificate, signed by the President (or any Vice President) and the
Treasurer of the Acquired Fund, as to the adjusted tax basis in the
hands of the Acquired Fund of the securities delivered to the
Acquiring Fund pursuant to this Agreement.
7.5 The custodian of the Acquired Fund shall have delivered to the
Acquiring Fund a certificate identifying all of the assets of the
Acquired Fund held by such custodian as of the Valuation Date.
17
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH OF THE ACQUIRING FUND
AND THE ACQUIRED FUND.
The respective obligations of the Acquired Fund and the Acquiring Fund hereunder
are each subject to the further conditions that on or before the Closing Date:
8.1 Shareholders of the Acquired Fund shall have elected the nominees for
Trustees of the Acquired Fund, set forth in the Proxy Statement.
8.2 On the Closing Date no action, suit or other proceeding shall be
pending before any court or governmental agency in which it is sought
to restrain or prohibit, or obtain damages or other relief in
connection with, this Agreement or the transactions contemplated
hereby.
8.3 All consents of other parties and all other consents, orders and
permits of federal, state and local regulatory authorities (including
those of the Securities and Exchange Commission and of state "Blue
Sky" and securities authorities) deemed necessary by the Acquired Fund
or the Acquiring Fund to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been
obtained, except where failure to obtain any such consent, order or
permit would not involve a risk of a material adverse effect on the
assets or properties of the Acquired Fund or the Acquiring Fund.
8.4 Reserved.
8.5 The Acquired Fund shall have received a favorable opinion of Ropes &
Gray LLP satisfactory to the Acquired Fund, and the Acquiring Fund
shall have received a favorable opinion of Ropes & Gray LLP
satisfactory to the Acquiring Fund, each substantially to the effect
that, for federal income tax purposes:
(a) The transactions contemplated by this Agreement will constitute a
reorganization within the meaning of Section 368(a) of the Code, and
the Acquired Fund and the Acquiring Fund will each be "a party to a
reorganization" within the meaning of Section 368(b) of the Code;
(b) No gain or loss will be recognized by the Acquired Fund (i) upon the
transfer of its assets to the Acquiring Fund in exchange for the
Acquisition Shares and the assumption by the Acquiring Fund of the
liabilities of the Acquired Fund or (ii) upon the distribution of
the Acquisition Shares by the
18
Acquired Fund to its shareholders in liquidation, as contemplated in
paragraph 1 hereof;
(c) No gain or loss will be recognized by the Acquiring Fund upon
receipt of the assets of the Acquired Fund in exchange for the
assumption of liabilities and obligations and issuance of the
Acquisition Shares as contemplated in paragraph 1 hereof;
(d) The tax basis of the assets of the Acquired Fund acquired by the
Acquiring Fund will be the same as the tax basis of such assets in
the hands of the Acquired Fund immediately prior to the transfer,
and the holding period of the assets of the Acquired Fund in the
hands of the Acquiring Fund will include the period during which
those assets were held by the Acquired Fund;
(e) The holding periods of the assets of the Acquired Fund in the hands
of the Acquiring Fund will include the periods during which such
assets were held by the Acquired Fund;
(f) No gain or loss will be recognized by the Acquired Fund shareholders
upon the exchange of all of their Acquired Fund shares for the
Acquisition Shares;
(g) The aggregate tax basis of the Acquisition Shares to be received by
each shareholder of the Acquired Fund will be the same as the
aggregate tax basis of the Acquired Fund shares exchanged therefor;
(h) An Acquired Fund shareholder's holding period for the Acquisition
Shares to be received will include the period during which the
Acquired Fund shares exchanged therefor were held, provided that the
shareholder held the Acquired Fund shares as a capital asset on the
date of the exchange; and
(i) The Acquiring Fund will succeed to and take into account the items
of the Acquired Fund described in Section 381(c) of the Code,
subject to the conditions and limitations specified in Sections 381,
382, 383 and 384 of the Code and the regulations thereunder.
The opinion will be based on certain factual certifications made by
officers of the Acquired Fund and the Acquiring Fund and will also be
based on customary assumptions. The opinion is not a
19
guarantee that the tax consequences of the relevant Acquisition
will be as described above.
Ropes & Gray LLP will express no view with respect to the effect of
the Acquisition on any transferred asset as to which any unrealized
gain or loss is required to be recognized at the end of a taxable year
(or on the termination or transfer thereof) under federal income tax
principles.
8.6 At any time prior to the Closing, any of the foregoing conditions of
this Agreement may be waived jointly by the Board of each of the
Acquired Fund and the Acquiring Fund, if, in their judgment, such
waiver will not have a material adverse effect on the interests of the
shareholders of the Acquired Fund or the Acquiring Fund.
9. BROKERAGE FEES AND EXPENSES.
9.1 The Acquired Fund and the Acquiring Fund each represents and warrants
to the other that there are no brokers or finders entitled to receive
any payments in connection with the transactions provided for herein.
9.2 All fees and expenses incurred in connection with the transactions
contemplated herein shall be borne by Columbia.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES.
10.1 The Acquired Fund and the Acquiring Fund agree that neither party has
made any representation, warranty or covenant not set forth herein and
that this Agreement constitutes the entire agreement between the
parties.
10.2 The representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in
connection herewith shall not survive the consummation of the
transactions contemplated hereunder except paragraphs 1.1, 1.3, 1.5,
5.4, 9, 10, 13 and 14.
11. TERMINATION.
11.1 This Agreement may be terminated by the mutual agreement of the
Acquired Fund and the Acquiring Fund. In addition, either the Acquired
Fund or the Acquiring Fund may at its option terminate this Agreement
at or prior to the Closing Date because:
(a) Of a material breach by the other of any representation, warranty,
covenant or agreement contained herein to be performed by the other
party at or prior to the Closing Date;
20
(b) A condition herein expressed to be precedent to the obligations of
the terminating party has not been met and it reasonably appears
that it will not or cannot be met; or
(c) Any governmental authority of competent jurisdiction shall have
issued any judgment, injunction, order, ruling or decree or taken
any other action restraining, enjoining or otherwise prohibiting
this Agreement or the consummation of any of the transactions
contemplated herein and such judgment, injunction, order, ruling,
decree or other action becomes final and non-appealable; provided
that the party seeking to terminate this Agreement pursuant to this
Section 11.1(c) shall have used its reasonable best efforts to have
such judgment, injunction, order, ruling, decree or other action
lifted, vacated or denied.
If the transactions contemplated by this Agreement have not been
substantially completed by December 31, 2007, this Agreement shall
automatically terminate on that date unless a later date is agreed to
by both the Acquired Fund and the Acquiring Fund.
11.2 If for any reason the transactions contemplated by this Agreement are
not consummated, no party shall be liable to any other party for any
damages resulting therefrom, including without limitation
consequential damages.
12. AMENDMENTS.
This Agreement may be amended, modified or supplemented in such manner as may be
mutually agreed upon in writing by the authorized officers of the Acquired Fund
and the Acquiring Fund; provided, however, that following the shareholders'
meeting called by the Acquired Fund pursuant to paragraph 5.2 no such amendment
may have the effect of changing the provisions for determining the number of the
Acquisition Shares to be issued to shareholders of the Acquired Fund under this
Agreement to the detriment of such shareholders without their further approval.
13. NOTICES.
Any notice, report, statement or demand required or permitted by any provisions
of this Agreement shall be in writing and shall be given by prepaid telegraph,
telecopy or certified mail addressed to the Acquired Fund or the Acquiring Fund,
One Financial Center, Boston, Massachusetts 02111, Attention: Secretary.
21
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT; NON-RECOURSE.
14.1 The article and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
14.2 This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
14.3 This Agreement shall be governed by and construed in accordance with
the domestic substantive laws of The Commonwealth of Massachusetts,
without giving effect to any choice or conflicts of law rule or
provision that would result in the application of the domestic
substantive laws of any other jurisdiction.
14.4 This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment
or transfer hereof or of any rights or obligations hereunder shall be
made by any party without the written consent of the other party.
Nothing herein expressed or implied is intended or shall be construed
to confer upon or give any person, firm or corporation, other than the
parties hereto and their respective successors and assigns, any rights
or remedies under or by reason of this Agreement.
14.5 A copy of the Declaration of Trust of the Acquiring Trust and the
Acquired Trust is on file with the Secretary of The Commonwealth of
Massachusetts, and notice is hereby given that no trustee, officer,
agent or employee of such fund shall have any personal liability under
this Agreement, and that this Agreement is binding only upon the
assets and properties of the Acquired Fund and the Acquiring Fund.
[THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK.]
22
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as a sealed instrument by its President, a Vice President or Treasurer
and its corporate seal to be affixed thereto and attested by its Secretary or
Assistant Secretary.
[NAME OF ACQUIRED FUND]
By:
-------------------------------------
Name:
Title:
[NAME OF ACQUIRING FUND]
By:
-------------------------------------
Name:
Title:
Solely for purposes of Paragraph 9.2 of
the Agreement
COLUMBIA MANAGEMENT ADVISORS, INC.
By:
-------------------------------------
Name:
Title:
23
EXHIBIT A
<Table>
<Caption>
ACQUIRED FUND AUTHORIZED CAPITAL
- ---------------------------- ----------------------------
- ---------------------------- ----------------------------
- ---------------------------- ----------------------------
</Table>
* Converts to Class A shares after the expiration of a period of time.
A-1
COLUMBIA MANAGEMENT
PROXY
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 16, 2005
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES. The undersigned
hereby appoints Christopher L. Wilson, J. Kevin Connaughton, Michael G. Clarke
and Vincent P. Pietropaolo, and each of them, with full power of substitution to
each, to vote all shares at the Special Meeting of Shareholders to be held at
One Financial Center, Boston, Massachusetts, on September 16, 2005 at 10:00 a.m.
Eastern time and at any and all adjournments, as specified herein and in
accordance with their best judgment, on any other business that may properly
come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BELOW
AND, ABSENT DIRECTION, WILL BE VOTED FOR THE PROPOSAL LISTED BELOW. THIS PROXY
WILL BE VOTED IN ACCORDANCE WITH THE HOLDER'S BEST JUDGMENT AS TO ANY OTHER
MATTER.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-837-1888
NOTE: Please sign exactly as name or names appear
hereon. Joint owners should each sign personally.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such. If a corporation, please sign in corporate
name by President or other authorized officer. If a
partnership, please sign in partnership name by
authorized person.
---------------------------------------------------
Shareholder sign here
---------------------------------------------------
Co-owner sign here
---------------------------------------------------
Date CNT_15318
FUNDS FUNDS FUNDS
- ----- ----- -----
Fundname Drop In 1 Fundname Drop In 2 Fundname Drop In 3
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Fundname Drop In 7 Fundname Drop In 8 Fundname Drop In 9
PLEASE MARK BOXES BELOW IN BLUE OR BLACK INK AS FOLLOWS. EXAMPLE: [X]
- ---------------------------------------------------------------------------
[ ] To vote FOR ALL Proposals for all funds mark this box. No other vote is
necessary.
- ---------------------------------------------------------------------------
1. TO ELECT TRUSTEES:
01. Douglas A. Hacker 02. Janet Langford Kelly 03. Richard W. Lowry 04. Charles R. Nelson
05. John J. Neuhauser 06. Patrick J. Simpson 07. Thomas E. Stitzel 08. Thomas C. Theobald
09. Anne-Lee Verville 10. Richard L. Woolworth 11. William E. Mayer
To withhold authority to vote for one or more of the nominees, write
the corresponding number(s) of the nominee(s) on the line provided next
to your fund(s).
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
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2.a. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO BORROWING MONEY, PLEDGING ASSETS, AND
ISSUING SENIOR SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.b. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO MAKING LOANS.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Fundname Drop In 1 [ ] [ ] [ ] Fundname Drop In 2 [ ] [ ] [ ] Fundname Drop In 3 [ ] [ ] [ ]
Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.c. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO DIVERSIFICATION OF INVESTMENTS.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Fundname Drop In 1 [ ] [ ] [ ] Fundname Drop In 2 [ ] [ ] [ ] Fundname Drop In 3 [ ] [ ] [ ]
Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.d. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO INVESTMENTS IN COMMODITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Fundname Drop In 1 [ ] [ ] [ ] Fundname Drop In 2 [ ] [ ] [ ] Fundname Drop In 3 [ ] [ ] [ ]
Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.e. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO INVESTMENTS IN REAL ESTATE.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Fundname Drop In 1 [ ] [ ] [ ] Fundname Drop In 2 [ ] [ ] [ ] Fundname Drop In 3 [ ] [ ] [ ]
Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.f. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO UNDERWRITING OF SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.g. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO PURCHASING SECURITIES ON MARGIN.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.h. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO INVESTING FOR THE PURPOSE OF EXERCISING
CONTROL.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.i. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO SHORT SALES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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2.j. TO APPROVE AN AMENDMENT TO CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO CONCENTRATING INVESTMENTS IN AN INDUSTRY.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ] Fundname Drop In 6 [ ] [ ] [ ]
Fundname Drop In 7 [ ] [ ] [ ] Fundname Drop In 8 [ ] [ ] [ ] Fundname Drop In 9 [ ] [ ] [ ]
2.k. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO PURCHASING ILLIQUID SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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2.l. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO INVESTING IN SECURITIES OF OTHER
INVESTMENT COMPANIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
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Fundname Drop In 4 [ ] [ ] [ ] Fundname Drop In 5 [ ] [ ] [ ]
2.m. TO APPROVE THE ELIMINATION OF CERTAIN FUNDS' FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO BUYING AND SELLING PUTS AND CALLS.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Fundname Drop In 1 [ ] [ ] [ ] Fundname Drop In 2 [ ] [ ] [ ]
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