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SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURUSANT TO SECTION 14(c) OF THE SECURITIES
EXCHANGE ACT OF 1934
Check the appropriate box:
[ ] Preliminary information statement
[X] Definitive information statement
[ ] Confidential, for use of the Commission only (as permitted by Rule
14c-5(d)(2))
MANUFACTURERS INVESTMENT TRUST
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exhange Act Rules 14c-5(g) and 0-11.
(not applicable)
[ ] 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.
(not applicable)
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[Letter sent to Manulife Variable Universal Life contract owners only]
January 5, 1998
Dear Contract Owner,
Enclosed please find an Information Statement regarding the subadviser to the
Strategic Bond portfolio and U.S. Government Securities portfolio of
Manufacturers Investment Trust, Salomon Brothers Asset Management Inc. ("SBAM").
The Information Statement is being sent to you to inform you that the ultimate
parent of SBAM and Salomon Brothers Asset Management Limited ("SBAM Limited"),
which manages certain assets of the Strategic Bond portfolio, has merged with
and into Smith Barney Holding Inc.
Since you have the option of investing your money in one or both of the
portfolios through your Manulife variable universal life insurance policy, the
Securities and Exchange Commission has required that the enclosed Information
Statement be sent to you informing you of the merger.
THE MERGER HAS NOT CHANGED THE INVESTMENT OBJECTIVE OR POLICIES, THE INVESTMENT
MANAGEMENT OF THE PORTFOLIOS, OR THE INVESTMENT PERSONNEL SERVICING THE
PORTFOLIOS.
The Securities and Exchange Commission is not requiring your approval via a
proxy vote but has requested that the enclosed Information Notice be sent to
explain the merger.
If you have further questions regarding the enclosed Information Statement, do
not hesitate to contact Manulife Financial at 1-800-VARILINE from 8:00 a.m.
through 6:00 p.m. Eastern time on any business day. Thank you for your
attention.
Respectfully yours,
/s/ Donald A. Guloien
Donald A. Guloien
President
(encl.)
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[Letter sent to Venture Variable Annuity contract owners
(Manufacturers North America) only]
January 5, 1998
Re: Your Venture Annuity contract
Dear Contract Owner,
Enclosed you will find an Information Statement regarding the Strategic
Bond and U.S. Government Securities portfolios of Manufacturers Investment Trust
which are managed by Salomon Brothers Asset Management Inc. ("SBAM"). This
Information Statement is being sent to you to inform you that the ultimate
parent of SBAM and Salomon Brothers Asset Management Limited ("SBAM Limited"),
has merged with and into Smith Barney Holding Inc., a wholly owned subsidiary of
Travelers Group Inc.
The merger has not resulted in any change in the portfolio managers for
either the U.S. Government Securities portfolio or the Strategic Bond portfolio,
nor has there been any material change in the other SBAM and SBAM Limited
investment personnel servicing these portfolios.
Please note that we are not asking you for a proxy and you are requested
not to send us a proxy. If you have further questions regarding the Information
Statement please call Client Services at 1-800-344-1029.
Very truly yours,
/s/ John D. DesPrez III
John D. DesPrez III, President
The Manufacturers Life Insurance Company of North America
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[Letter sent to Venture Variable Annuity contract owners
(Manufacturers New York) only]
January 5, 1998
Re: Your Venture Annuity contract
Dear Contract Owner,
Enclosed you will find an Information Statement regarding the Strategic
Bond and U.S. Government Securities portfolios of Manufacturers Investment Trust
which are managed by Salomon Brothers Asset Management Inc. ("SBAM"). This
Information Statement is being sent to inform you that the ultimate parent of
SBAM and Salomon Brothers Asset Management Limited ("SBAM Limited"), has merged
with and into Smith Barney Holding Inc., a wholly owned subsidiary of Travelers
Group Inc.
The merger has not resulted in any change in the portfolio managers for
either the U.S. Government Securities portfolio or the Strategic Bond portfolio,
nor has there been any material change in the other SBAM and SBAM Limited
investment personnel servicing these portfolios.
Please note that we are not asking you for a proxy and you are requested
not to send us a proxy. If you have further questions regarding the Information
Statement please call Client Services at 1-800-551-2078.
Very truly yours,
/s/ Joe Scott
Joe Scott, President
The Manufacturers Life Insurance Company of New York
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[Letter sent to Venture Life contract owners
(Manufacturers North America) only]
January 5, 1998
Re: Your Venture Life contract
Dear Contract Owner,
Enclosed you will find an Information Statement regarding the Strategic
Bond and U.S. Government Securities portfolios of Manufacturers Investment Trust
which are managed by Salomon Brothers Asset Management Inc. ("SBAM"). This
Information Statement is being sent to you to inform you that the ultimate
parent of SBAM and Salomon Brothers Asset Management Limited ("SBAM Limited"),
has merged with and into Smith Barney Holding Inc., a wholly owned subsidiary of
Travelers Group Inc.
The merger has not resulted in any change in the portfolio managers for
either the U.S. Government Securities portfolio or the Strategic Bond portfolio,
nor has there been any material change in the other SBAM and SBAM Limited
investment personnel servicing these portfolios.
Please note that we are not asking you for a proxy and you are requested
not to send us a proxy. If you have further questions regarding the Information
Statement please call Client Services at 1-800-600-3814.
Very truly yours,
/s/ John D. DesPrez III
John D. DesPrez III, President
The Manufacturers Life Insurance Company of North America
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MANUFACTURERS INVESTMENT TRUST
116 HUNTINGTON AVENUE, BOSTON, MASSACHUSSETTS 02116
INFORMATION STATEMENT TO SHAREHOLDERS REGARDING
SALOMON BROTHERS ASSET MANAGEMENT INC AND
SALOMON BROTHERS ASSET MANAGEMENT LIMITED
DECEMBER 26, 1997
On November 28, 1997, Salomon Inc, the ultimate parent of Salomon Brothers
Asset Management Inc ("SBAM"), the subadviser to the Strategic Bond and U.S.
Government Securities portfolios of Manufacturers Investment Trust (the "Trust")
merged with and into Smith Barney Holding Inc., a wholly owned subsidiary of
Travelers Group Inc. ("Travelers") to form a new company called Salomon Smith
Barney Holdings Inc. ("Salomon Smith Barney") (the "Transaction"). Upon
consummation of the Transaction, Travelers became the ultimate parent of SBAM
and Salomon Brothers Asset Management Limited ("SBAM Limited"), which manages
the investment of certain assets of the Strategic Bond portfolio. Travelers is a
diversified financial servies company engaged in investment services, asset
management, consumer finance and life and property casualty insurance services.
As described below, under certain interpretations, the Transaction might be
deemed to result in an "assignment" as defined in the Investment Company Act of
1940, as amended (the "1940 Act") of the SBAM subadvisory agreement and the SBAM
Limited consulting agreement, which, if so interpreted, would have resulted in
the termination of such agreements. Therefore, the Board of Trustees of the
Trust has approved new agreements for SBAM and SBAM Limited on substantially
identical terms to the old agreements except as noted below. The Transaction has
not resulted in any change in the portfolio managers for either the U.S.
Government Securities portfolio or the Strategic Bond portfolio nor has there
been any material change in the other SBAM and SBAM Limited investment personnel
servicing these portfolios.
APPROVAL OF NEW SUBADVISORY AGREEMENT AND NEW CONSULTING AGREEMENT
Prior to November 28, 1997, SBAM was the subadviser to the U.S. Government
Securities and Strategic Bond portfolios pursuant to a subadvisory agreement
(the "Old Subadvisory Agreement") dated January 1, 1996 between SBAM and
Manufacturers Securities Services, LLC ("MSS" or the "Adviser"), the investment
adviser to the Trust. In addition, in connection with SBAM services as
subadviser to the Strategic Bond portfolio, SBAM Limited provides certain
services to SBAM relating to currency transactions and investments in non-dollar
denominated debt securities pursuant to a subadvisory consulting agreement dated
January 1, 1996 (the "Old Consulting Agreement").
As required by the 1940 Act, the Old Subadvisory Agreement and the Old
Consulting Agreement provided for their automatic termination upon their
"assignment." As discussed above, the Transaction could be deemed an assignment
of both these agreements. Therefore, the Board of Trustees of the Trust has
approved a new subadvisory agreement between SBAM and MSS and a new subadvisory
consulting agreement between SBAM and SBAM Limited effective as of the closing
of the Transaction, November 28, 1997 (the "New Subadvisory Agreement" and the
"New Consulting Agreement," respectively). Pursuant to an order the Trust has
received from the Securities and Exchange Commission, shareholder approval of
the New Subadvisory Agreement and the New Consulting Agreement is not required.
However, a condition of this order is that notice be sent to shareholders
informing them of the new agreements. This Information Statement is being
supplied to shareholders to fulfill that condition. This Information Statement
will be mailed on or about January 5, 1998.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
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DESCRIPTION OF NEW AND OLD SUBADVISORY AGREEMENTS AND NEW AND OLD CONSULTING
AGREEMENTS
The New Subadvisory Agreement and the New Consulting Agreement are
substantially identical to the Old Subadvisory Agreement and Old Consulting
Agreement, respectively, differing only with respect to their effective date and
certain of the provisions regarding shareholder approval of the agreement. The
subadvisory fees payable under the New Subadvisory Agreement and the New
Subadvisory Consulting Agreement are the same as the fees paid under the Old
Subadvisory Agreement and the Old Consulting Agreement, respectively.
Under the terms of the Old Subadvisory Agreement and the New Subadvisory
Agreement (the "Subadvisory Agreements"), SBAM manages the investment and
reinvestment of the assets of the U.S. Government Securities and Strategic Bond
portfolios (the "Portfolios"), subject to the supervision of the Trust's Board
of Trustees. Under the terms of the Old Consulting Agreement and the New
Consulting Agreement (the "Consulting Agreements"), SBAM Limited undertakes to
act as a subadviser and manage the investment and reinvestment of such part of
the assets of the Strategic Bond portfolio as may be agreed between SBAM and
SBAM Limited from time to time, subject to the supervision of SBAM and the
Trustees of the Trust and to the terms of the Subadvisory Consulting Agreements.
SBAM and SBAM Limited formulate a continuous investment program for each
Portfolio subadvised consistent with the Portfolios investment objectives and
policies. SBAM and SBAM Limited implement such programs by purchases and sales
of securities and regularly report to the Adviser and the Trustees of the Trust
with respect to the implementation of such programs. SBAM and SBAM Limited, at
their expense, furnish all necessary investment and management facilities,
including salaries of personnel required for it to execute its duties, as well
as administrative facilities, including bookkeeping, clerical personnel, and
equipment necessary for the conduct of the investment affairs of the subadvised
Portfolios.
As compensation for its services, the Adviser receives an advisory fee
computed separately for each Portfolio. The fee for each Portfolio is stated as
an annual percentage of the curent value of the net assets of the Portfolio. The
fee, which is accrued daily and payable monthly, is calculated for each day by
multiplying the daily equivalent of the annual percentage prescribed for a
Portfolio by the value of the net assets of the Portfolio at the close of
business on the previous business day of the Trust. The following is a schedule
of the advisory fees each Portfolio currently is obligated to pay the Adviser.
PORTFOLIO ADVISORY FEE
Strategic Bond Trust .775%
U.S. Government Securities .650%
As compensation for its services, SBAM receives a fee from the Adviser
computed separately for each Portfolio. The fee for each Portfolio is stated as
an annual percentage of the current value of the net assets of the Portfolio.
The fees are calculated on the basis of the average of all valuations of net
assets of each Portfolio made at the close of business on each business day of
the Trust during the period for which such fees are paid. Once the average net
assets of a Portfolio exceed specified amounts, the fee is reduced with respect
to such excess. The following is a schedule of the management fees the Adviser
paid SBAM under the Old Subadvisory Agreement, and is currently is obligated to
pay SBAM under the New Subadvisory Agreement, out of the advisory fee it
receives from each Portfolio as specified above. THESE FEES ARE PAID BY THE
ADVISER OUT OF THE ADVISORY FEE IT RECEIVES FOR EACH PORTFOLIO AND ARE NOT
ADDITIONAL CHARGES TO THE PORTFOLIO.
PORTFOLIO First $50 Million Between $50 Between $200 Excess Over $500
Million and $200 Million and $500 Million
Million Million
Strategic Bond* .350% .300% .250% .200%
U.S. Government
Securities .225% .225% .150% .100%
* In connection with the Old Consulting Agreement SBAM paid, and in connection
with the New Consulting Agreement SBAM will pay, SBAM Limited, as full
compensation for all services provided under the Consulting Agreements, a
portion of its subadvisory fee, such amount being an amount equal to the fee
payable under the Subadvisory Agreements, multiplied by the current value of the
net assets of the portion of the assets of the
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Strategic Bond Trust that SBAM Limited has been delegated to manage divided by
the current value of the net assets of the Portfolio.
The Old Subadvisory Agreement and the Old Consulting Agreement required
approval of the agreement as to a Portfolio by both (i) the Trustees of the
Trust including a majority of Trustees who are not "interested persons" (defined
in the 1940 Act) of any parties to the agreements and (ii) a majority of the
outstanding voting securities of the Portfolio. The New Subadvisory Agreement
and the New Consulting Agreement require only approval of the Trustees of the
Trust including a majority of Trustees who are not interested persons of any
parties to these agreements.
The Subadvisory Agreements and the Consulting Agreements (collectively,
"the Agreements") will continue in effect as to a Portfolio for a period no more
than two years from the date of their execution only so long as such continuance
is specifically approved at least annually either by the Trustees or by the vote
of a majority of the outstanding voting securities of the Trust, provided that
in either event such continuance shall also be approved by the vote of the
majority of the Trustees who are not "interested persons" (as defined in the
1940 Act) of any party to the Agreements, cast in person at a meeting called for
the purpose of voting on such approval. Any required shareholder approval of any
continuance of any of the Agreements shall be effective with respect to any
Portfolio if a majority of the outstanding voting securities of the series of
shares of beneficial interest of that Portfolio vote to approve such
continuance, notwithstanding that such continuance may not have been approved by
a majority of the outstanding voting securities of any other Portfolio affected
by the Agreement.
If any required shareholder approval of any continuance of one or more of
the Agreements is not obtained, SBAM or SBAM Limited, as applicable, will
continue to act as subadviser with respect to such Portfolio pending the
required approval of the continuance of such Agreement, of a new contract with
SBAM or SBAM Limited, as applicable, or different adviser or subadviser, or
other definitive action.
Each of the Agreements may be terminated at any time without the payment of
any penalty on 60 days' written notice to the other party or parties to the
Agreements and to the Trust: (i) by the Trustees of the Trust; (ii) with respect
to any Portfolio, by the vote of a majority of the outstanding voting securities
of the series of shares of beneficial interest of such Portfolio; (iii) in the
case of the Subadvisory Agreements, by SBAM or the Adviser and (iv) in the case
of the Consulting Agreements, by SBAM or SBAM Limited. The Agreements will
automatically terminate in the event of their assignment.
The Subadvisory Agreements may be amended by the Adviser and SBAM and the
Consulting Agreement by SBAM and SBAM Limited provided such amendment is
specifically approved by the vote of a majority of the Trustees of the Trust who
are not interested persons of the Trust, the Adviser, SBAM or SBAM Limited cast
in person at a meeting called for the purpose of voting on such approval. The
Old Subadvisory Agreement and the Old Consulting Agreement, in addition,
provided that any such amendment must be specifically approved by the vote of a
majority of the outstanding voting securities of each of the Portfolios affected
by the amendment. The required shareholder approval would have been effective
with respect to any Portfolio if a majority of the outstanding voting securities
of that Portfolio voted to approve the amendment, notwithstanding that the
amendment may not have been approved by a majority of the outstanding voting
securities of (a) any other Portfolio affected by the amendment or (b) all the
portfolios of the Trust.
The Agreements provide that SBAM or SBAM Limited will not be liable to the
Trust or the Adviser for any losses resulting from any matters to which the
agreement relates other than losses resulting from SBAM's or SBAM Limited's
willful misfeasance, bad faith or gross negligence in the performance of, or
from reckless disregard of, its duties.
BOARD OF TRUSTEE CONSIDERATIONS
At its meeting duly held on November 17, 1997, the Board of Trustees,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of any party to the New Subadvisory Agreement and the
New Consulting Agreement (collectively, the "New Agreements"), approved the New
Agreements.
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In connection with the approval of the New Agreements, the Board
considered, among other things, that the Transaction would not result in any
material change in (i) any Portfolio's investment objective or policies, (ii)
the investment management of the Portfolios or (iii) the investment personnel
managing the Portfolios. Management of SBAM informed the Trustees that the
Transaction is not expected to result in any such changes, although no assurance
can be given that such changes will not occur.
In evaluating the New Agreements, the Board took into account the fact that
the New Agreements are substantially similar to the Old Subadvisory Agreement
and the Old Consulting Agreement (the "Old Agreements"), differing only with
respect to their effective date and certain of the provisions regarding
shareholder approval of the Agreements. The Board in approving the New
Agreements evaluated a number of factors, including, but not limited to, the
nature and quality of the services provided by SBAM and SBAM Limited, the fees
paid SBAM and SBAM Limited and other comparable investment companies,
performance information regarding the Portfolios and other comparable investment
companies. The Board was also given audited financial statements of SBAM and
SBAM Limited as well as audited financial statements of Travelers. The Board was
also provided with an analysis of its fiduciary obligations in connection with
such considerations. In considering the New Agreements, the Trustees discussed
the information provided to them and their fiduciary obligations.
SUBADVISORY AND SUBADVISORY CONSULTING FEES PAID
For the year ended December 31, 1996, the Adviser paid subadvisory fees to
SBAM as follows:
Dollar Amount Percent of Average Net Assets
Strategic Bond $527,906* .32%
U.S. Government Securities $473,786 .22%
**$131,977 of this amount was paid to SBAM Limited.
ADVISORY FEES PAID
For the year ended December 31, 1996, the Portfolios paid the Adviser the
following advisory fees:
Dollar Amount Percent of Average Net Assets
Strategic Bond $1,298,996 .775%
U.S. Government Securities $1,401,130 .650%
For the year ended December 31, 1996, the net investment advisory fees
retained by the Adviser after payment of the subadvisory fee for the Portfolios
is as follows:
Dollar Amount Percent of Average Net Assets
Strategic Bond $771,090 .46%
U.S. Government Securities $927,345 .43%
PRIOR TRUSTEES AND SHAREHOLDER APPROVAL OF THE OLD AGREEMENTS
The Old Agreements were most recently approved by the Board of Trustees at
a meeting held June 26, 1997 in connection with the annual review of the Old
Agreements. The Old Agreements were most recently approved by shareholders at a
meeting held on December 5, 1995. This shareholder approval occurred in
connection with an indirect change in control of MSS due to the merger of MSS's
then ultimate parent, North American Life Assurance Company, with The
Manufacturers Life Insurance Company, the ultimate parent of MSS.
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OWNERSHIP OF THE TRUST
As of November 28, 1997, 100% of the Trust's shares were legally owned by
three shareholders: (i) The Manufacturers Life Insurance Company of North
America, a Delaware stock life insurance company whose address is 116 Huntington
Avenue ("Manulife North America"), Boston, Massachusetts 02116, (ii) The
Manufacturers Life Insurance Company of New York ("Manulife New York"), a wholly
owned subsidiary of Manulife North America and a New York stock life insurance
company whose address is 555 Theodore Fremd Avenue, Rye, New York 10580 and
(iii) The Manufacturers Life Insurance Company of America ("Manufacturers
America"), a stock life insurance company organized under the laws of
Pennsylvania and redomesticated under the laws of Michigan whose address is 500
North Woodward Avenue, Bloomfield Hills, Michigan 48304. Manulife North America
holds Trust shares attributable to variable annuity contracts in The
Manufacturers Life Insurance Company of North America Separate Account A and
Trust shares attributable to variable life contracts in The Manufacturers Life
Insurance Company of North America Separate Account B, both of which are
separate accounts registered under the 1940 Act, as well as in an unregistered
separate account. Manulife New York holds Trust shares attributable to variable
contracts in The Manufacturers Life Insurance Company of New York Separate
Account A, a separate account registered under the 1940 Act. Manufacturers
America holds Trust shares attributable to variable contracts in Manufacturers
America Separate Accounts Three and Four, which are separate accounts registered
under the 1940 Act. The ultimate parent of both Manulife North America and
Manufacturers Life of America is The Manufacturers Life Insurance Company
("Manulife"), a Canadian mutual life insurance company whose principal address
is 200 Bloor Street East, Toronto, Ontario, Canada M4W 1E5.
Trustees and officers of the Trust, in the aggregate, own less than 1% of
the Trust's outstanding shares.
MANAGEMENT AND CONTROL OF SBAM AND SBAM LIMITED
SBAM is a direct wholly subsidiary of Salomon Brothers Holding Company Inc
("SBHC") which is in turn a wholly owned subsidary Salomon Smith Barney. Salomon
Smith Barney is a wholly owned subsidiary of Travelers. The business address of
SBAM is Seven World Trade Center, New York, New York 10048.
SBAM Limited is a direct, wholly-owned subsidiary of SBHC. The business
address of SBAM Limited is Victoria Plaza, 111 Buckingham Palace Road, London
SW1W OSB, England.
Travelers is a publicly traded financial services holding company whose
principal business address is 388 Greenwich Street, New York, New York 10013.
Travelers is a diversified integrated finance services, and life and
property-casualty insurance services. Travelers' investment services include
investment banking, asset management, retail brokerage and other financial
services provided through Salomon Smith Barney and certain of its subsidiaries.
The names, titles and principal occupation of the current executive
officers and directors of SBAM are as follows:
NAME TITLE AND PRINCIPAL OCCUPATION
Thomas W. Brock Chairman, Chief Executive Officer and Managing Director of
SBAM and Managing Director and Member of the Management
Board of Salomon Brothers Inc
Michael S. Hyland President, Managing Director and Member of the Board of SBAM
and Managing Director of
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Salomon Brothers Inc
Rodney B. Berens Managing Director and Member of the Board of SBAM and
Managing Director and Member of the Management Board of
Salomon Brothers Inc
Vilas V. Gadkari Managing Director and Member of the Board of SBAM and
Managing Director of Salomon Brothers Inc
Zachary Snow Secretary of SBAM and Managing Director and Counsel of
Salomon Brothers Inc
The business address of each person listed above other than Mr. Gadkari is
7 World Trade Center, New York, New York 10048 and the business address of Mr.
Gadkari is Victoria Plaza, 111 Buckingham Palace Road, London, England SW1W OSB.
The names, titles and principal occupation of the current executive
officers and directors of SBAM Limited are as follows:
NAME TITLE AND PRINCIPAL OCCUPATION (INCLUDING
AFFILIATION WITH SBAM LIMITED
Thomas W. Brock Director of SBAM Limited; Chairman, Chief Executive Officer
and Managing Director of SBAM and Managing Director and
Member of the Management Board of Salomon Brothers Inc
Michael S. Hyland Director/Chairman of SBAM Limited; President, Managing
Director and Member of the Board of SBAM and Managing
Director of Salomon Brothers Inc.
Vilas V. Gadkari Chief Investment Officer and Director of SBAM Limited;
Managing Director and Member of the Board of SBAM and
Managing Director of Salomon Brothers Inc.
Joseph V. McDevitt Chief Operating Officer and Director of SBAM Limited
Susan H. Dean Finance Officer of SBAM Limited
Beatrice J. Doran Vice President and Counsel of SBAM Limited
The business address of each person listed below except for Messrs. Hyland
and Brock is Victoria Plaza, 111 Buckingam Palace Road, London SW1W OSB,
England. The business address of Messrs. Hyland and Brock is 7 World Trade
Center, New York, New York 10048.
BROKERAGE TRANSACTIONS
Pursuant to the Agreements, SBAM (and SBAM Limited) (hereafter collectively
referred to as the "Subadvisers" ) are responsible for placing all orders for
the purchase and sale of portfolio securities of the Portfolios. The Subadvisers
have no formula for the distribution of the Portfolio's brokerage business,
their intention being to place orders for the purchase and sale of securities
with the primary objective of obtaining the most favorable overall results for
the Portfolios.
In selecting brokers or dealers through whom to effect transactions, the
Subadvisers give consideration to a number of factors, including price, dealer
spread or commission, if any, the reliability, integrity and financial condition
of the broker-dealer, size of the transaction and difficulty of execution. In
selecting brokers and deal-
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ers, the Subadvisers also give consideration to the value and quality of any
research, statistical, quotation or valuation services provided by the broker or
dealer. In placing a purchase or sale order, a Subadviser may use a broker whose
commission in effecting the transaction is higher than that of some other broker
if the Subadviser determines in good faith that the amount of the higher
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker, viewed in terms of either the particular
transaction or the Subadviser's overall responsibilities with respect to the
Portfolios and any other accounts managed by the Subadviser.
To the extent research services are used by the Subadvisers in rendering
investment advice to the Portfolio, such services would tend to reduce the
Subadvisers' expenses. However, the Subadvisers do not believe that an exact
dollar value can be assigned to these services. Research services received by
the Subadvisers from brokers or dealers executing transactions for the Trust
will be available also for the benefit of other portfolios managed by the
Subadvisers.
For the year ended December 31, 1996, the Trust for all portfolios paid
brokerage commissions in connection with portfolio transactions of $13,006,480,
although no commissions were paid in connection with the Strategic Bond or U.S.
Government Securities portfolios.
Salomon Brothers Inc ("Salomon Brothers") is an affiliated broker of the
Portfolios due to SBAM's position as subadviser to the Portfolios and due to the
position of SBAM Limited as subadviser to the Strategic Bond portfolio. For the
fiscal year ended December 31, 1996, no brokerage commissions were paid to
Salomon Brothers by either the Strategic Bond portfolio or the U.S. Government
Securities portfolio.
OTHER INVESTMENT COMPANIES ADVISED BY SBAM AND SBAM LIMITED
SBAM and SBAM Limited manage the following mutual funds with objectives
similar to the investment objective of the Strategic Bond Portfolio:
- --------------- --------------------------------------------------- ------------------------------ ------------------------
FUND INVESTMENT OBJECTIVE SUBADVISORY FEE NET ASSETS (10/31//97)
(THOUSANDS)
- --------------- --------------------------------------------------- ------------------------------ ------------------------
North Seeks a high level of total return consistent First $50 million - .35% $83,060
American with preservation of capital by giving SBAM broad $50 - 200 million - .30%
Funds discretion to deploy the portfolio's assets among $200 - 500 million -.25%
Strategic certain segments of the fixed-income market as + $500 million - .20%
Income Fund SBAM believes will best contribute to achievement
of the portfolio's investment objective. SBAM pays SBAM Limited a
portion of its subadvisory
fee.*
- --------------- --------------------------------------------------- ------------------------------ ------------------------
The Salomon Seeks to obtain a high level of current income by First $50 million -.375% $32,874
Brothers/JNL investing in a globally diverse portfolio of $50 - 150 million - .35%
Global Bond fixed income investments and by giving SBAM broad $150 - 500 million - .30%
Series discretion to deploy the Series' assets among +$500 million - .25%
certain segments of the fixed income market.
SBAM pays SBAM Limited a
portion of its subadvisory
fee.*
- --------------- --------------------------------------------------- ------------------------------ ------------------------
Salomon Seeks a high level of total return consistent First $50 million - .35% $66,278
Brothers with preservation of capital by $50 - 200 million - .30%
Strategic $200 - 500 million - .25%
Bond
Opportunities
Series
- --------------- --------------------------------------------------- ------------------------------ ------------------------
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- --------------- --------------------------------------------------- ------------------------------ ------------------------
investing primarily in U.S. government obligations, +$500 million - .20%
mortgage backed securities, domestic corporate
debt, and international debt securities rated SBAM pays SBAM Limited 33
investment grade and domestic corporate and 1/3% of it subadvisory fee.
international debt rated below investment grade.
- --------------- --------------------------------------------------- ------------------------------ ------------------------
Salomon Seeks a high level of current income by investing Management Fee - .75%** $77,634
Brothers in a globally diverse portfolio of fixed-income
Strategic investments and by giving SBAM broad discretion SBAM pays SBAM Limited a
Bond Fund to deploy the Fund's assets among certain portion of its advisory fee.*
segments of the fixed-income market.
- --------------- --------------------------------------------------- ------------------------------ ------------------------
Nationwide Seeks a high level of current income by investing First $50 million - .35% ***
Multi Sector in a globally diverse portfolio of fixed-income $50 - 200 million - .30%
Bond Fund investments and by giving SBAM broad discretion to $200 - 500 million - .25%
deploy the fund's assets among certain segments of +$500 million - .20%
the fixed-income market that SBAM believes will
best contribute to achievement of the fund's
objective.
- --------------- --------------------------------------------------- ------------------------------ ------------------------
Salomon Seeks a high level of current income by investing .225% $2,716
Brothers U.S. a substantial portion of its assets in debt
Government obligations and mortgage-backed securities issued
Securities or guaranteed by the U.S. Governemnt, its
Portfolio, an agencies or instrumentalities and collateralized
investment mortgage obligtaions backed by such securities.
portfolio of
WNL Series
Trust
- --------------- --------------------------------------------------- ------------------------------ ------------------------
*SBAM pays SBAM Limited a portion of its advisory fee. The amount payable to
SBAM Limited is equal to the fee payable under SBAM's subadvisory agreement
multiplied by the portion of the assets of the portfolio that SBAM Limited has
been delegated to manage divided by the current value of the net assets of the
portfolio.
**Advisory Fee.
***This portfolio commenced investment operations October 31, 1997
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SBAM manages the following mutual funds with objectives similar to the
investment objective of the U.S. Government Securities portfolio:
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
Fund Investment Objective Subadvisory Fee Net Assets (10/31/97)
(thousands)
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
North American Seeks a high level of current income consistent First $200 million - .225% $84,144
Funds U.S. with preservation of capital and maintenance of $200 - 500 million - .15%
Government liquidity, by investing in debt obligations and +$500 million - .10%
Securities Fund mortgage-backed securities issued or guaranteed
by the U.S. government, its agencies or
instrumentalities, primarily Government National
Mortgage Association mortgage-backed certificates
popularly known as "Ginnie Maes."
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
The Salomon Seeks to obtain a high level of current income by First $150 million - .225% $21,536
Brothers/JNL investing primarily in debt obligations and $150 - 300 million - .175%
U.S. Government mortgage-backed securities issued or guaranteed $300 - 500 million - .15%
& Quality Bond by the U.S. government, its agencies or +$500 million - .10%
Series instrumentalities including collateralized
mortgage obligations backed by such securities.
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
Salomon Brothers Seeks to obtain a high level of current income by First $200 million - .225% $19,739
U.S. Government investing primarily in debt obligations and $200 - 500 million - .15%
Series mortgage-backed securities issued or guaranteed +$500 million - .10%
by the U.S. Government, its agencies or
instrumentalities.
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
Salomon Brothers Seeks a high level of current income by investing Management Fee - .60%* $13,085
U.S. Government in securities issued or guaranteed by the U. S.
Income Fund government, its agencies or instrumentalities.
- ------------------ --------------------------------------------------- ---------------------------- ------------------------
* Advisory Fee
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OTHER MATTERS
The Trust will furnish, without charge, a copy of the Trust's annual report
for the fiscal year ended December 31, 1996 and the Trust's semi-annual report
for the six month period ended June 30, 1997 to a shareholder upon request. To
obtain a report, please contact the Trust by calling (800) 344-1029 or by
writing to 116 Huntington Avenue, Boston, Massachusetts 02116, Attn: Kevin Hill.
Manufacturers Securities Services, LLC, the adviser to the Trust, is
located at 73 Tremont Street, Boston, Massachusetts 02108.
The Trust is not required to hold annual meetings of shareholders and,
therefore, it cannot be determined when the next meeting of shareholders will be
held. Shareholder proposals to be presented at any future meeting of
shareholders of the Trust must be received by the Trust a reasonable time before
the Trust's solicitation of proxies for that meeting in order for such proposals
to be considered for inclusion in the proxy materials related to that meeting.
The cost of the preparation, printing and distribution of this Information
Statement is an expense of MSS although the Adviser expects to receive
reimbursement from Travelers for these expenses.
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