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SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURSUANT TO SECTION 14(c) OF THE SECURITIES
EXCHANGE ACT OF 1934
Check the appropriate box:
Preliminary information statement
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X Definitive information statement
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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 Exchange Act Rules 14c-5(g) and 0-11.
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(not applicable)
Fee paid previously with preliminary materials
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- --- 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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May 1, 1998
Manulife Financial
73 Tremont Street
Boston, Massachusetts 02108
Dear Contract Owner,
Enclosed please find an Information Statement regarding Founders Asset
Management, Inc. ("Founders Inc."), the subadviser to the Growth, Worldwide
Growth, Balanced and International Small Cap portfolios of Manufacturers
Investment Trust. Founders Inc. has merged with and into Founders Asset
Management LLC. Upon consummation of the merger, Founders Asset Management LLC
became the subadviser to the above portfolios and Mellon Bank Corporation the
ultimate parent of Founders Asset Management LLC.
The merger has not changed the investment objective or policies, the investment
management of the portfolios, or the investment personnel servicing the
portfolios. The merger has also not resulted in any change in the rate of
advisory or subadvisory fee for any of 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 contract 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,
Donald A. Guloien
President
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MANUFACTURERS INVESTMENT TRUST
116 HUNTINGTON AVENUE, BOSTON, MASSACHUSETTS 02116
INFORMATION STATEMENT TO SHAREHOLDERS REGARDING
FOUNDERS ASSET MANAGEMENT, INC.
May 1, 1998
On April 1, 1998, Founders Asset Management, Inc. ("Founders Inc."), the
subadviser to the Growth, Worldwide Growth, Balanced and International Small Cap
portfolios (the "Portfolios") of Manufacturers Investment Trust (the "Trust")
merged with and into Founders Asset Management LLC ("Founders LLC") (the
"Transaction"). Upon consummation of the Transaction, Founders LLC became the
subadviser to the Portfolios and Mellon Bank Corporation ("Mellon") the ultimate
controlling parent of Founders LLC.
As a result of the Transaction, Founders LLC has entered into a new
subadvisory agreement with Manufacturers Securities Services, LLC ("MSS" or the
"Adviser"), 73 Tremont Street, Boston, MA 02108, the adviser to the Trust. The
new subadvisory agreement is on substantially identical terms to the subadvisory
agreement between MSS and Founders Inc. except as noted below. The Board of
Trustees of the Trust approved the new subadvisory agreement at a meeting held
on December 11, 1997. The Transaction has not resulted in any change in the
portfolio managers for any of the Portfolios nor has there been any material
change in the investment personnel servicing these portfolios.
APPROVAL OF NEW SUBADVISORY AGREEMENT
Prior to April 1, 1998, Founders Inc. was the subadviser to the Portfolios
pursuant to a subadvisory agreement (the "Old Subadvisory Agreement") dated
January 4, 1996, as amended June 20, 1996 and December 31, 1996 between Founders
Inc. and MSS.
As result of the Transaction, the Board of Trustees of the Trust has
approved a new subadvisory agreement between Founders LLC and MSS effective as
of the closing of the Transaction, April 1, 1998 (the "New Subadvisory
Agreement"). Pursuant to an order the Trust has received from the Securities and
Exchange Commission, shareholder approval of the New Subadvisory 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 May 4, 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
The New Subadvisory Agreement is substantially identical to the Old
Subadvisory Agreement, 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 are the same as the
fees paid under the Old Subadvisory Agreement.
Under the terms of the Old Subadvisory Agreement and the New Subadvisory
Agreement (the "Subadvisory Agreements"), Founders Inc. or Founders LLC, as
applicable (collectively, "Founders") manages the investment and reinvestment of
the assets of the Portfolios, subject to the supervision of the Trust's Board of
Trustees. Founders formulates a continuous investment program for each
subadvised Portfolio consistent with the Portfolio's investment objectives and
policies. Founders implements 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. Founders, at its expense, furnishes 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 current 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
Growth Trust .850%
Worldwide Growth Trust 1.00%
Balanced Trust .800%
International Small Cap Trust 1.10%
As compensation for its services, Founders 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
was obligated to pay Founders Inc. under the Old Subadvisory Agreement, and is
currently is obligated to pay Founders LLC 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. THE TRANSACTION HAS
NOT RESULTED IN ANY CHANGES IN THE RATE OF THESE FEES.
PORTFOLIO First $50 Million Between $50 Between $200 Excess Over $500
Million and $200 Million and $500 Million
Million Million
Growth Trust .450% .450% .350% .300%
Worldwide
Growth Trust .600% .550% .450% .350%
Balanced Trust .375% .325% .275% .225%
International
Small Cap Trust .650% .600% .500% .400%
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The Old Subadvisory 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 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 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 Subadvisory 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 Subadvisory
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 Subadvisory Agreement.
If any required shareholder approval of any continuance of one or more of
the Subadvisory Agreements is not obtained, Founders 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 Founders or different
adviser or subadviser, or other definitive action.
The Subadvisory 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 Subadvisory 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) by Founders or (iv) by the Adviser. The Subadvisory
Agreements will automatically terminate in the event of their assignment.
The Subadvisory Agreements may be amended by the Adviser and Founders
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 or Founders cast in person at a meeting called for the purpose of voting
on such approval. The Old Subadvisory 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. Shareholder approval is not required for an amendment
to the new Subadvisory Agreement
The Subadvisory Agreements provide that Founders 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 Founder'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 December 11, 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 approved
the New Subadvisory Agreement.
In connection with the approval of the New Subadvisory Agreement, 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 Founders Inc. 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.
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In evaluating the New Subadvisory Agreement, the Board took into account
the fact that the New Subadvisory Agreement is substantially similar to the Old
Subadvisory Agreement, differing only with respect to their effective dates and
certain of the provisions regarding shareholder approval of the Subadvisory
Agreements. The Board in approving the New Subadvisory Agreement, evaluated a
number of factors, including, but not limited to, the nature and quality of the
services to be provided by Founders LLC, the fees to be paid to Founders LLC and
other comparable investment companies, and performance information regarding the
Portfolios and other comparable investment companies. The Board was also given
audited financial statements of Founders Inc. The Board was provided with an
analysis of its fiduciary obligations in connection with such considerations. In
considering the New Subadvisory Agreement, the Trustees discussed the
information provided to them and their fiduciary obligations.
SUBADVISORY FEES PAID
For the year ended December 31, 1997, the Adviser paid subadvisory fees to
Founders Inc. as follows:
Dollar Amount Percent of Average Net Assets
Growth $495,015 .450%
Worldwide Growth $74,971 .600%
Balanced $537,310 .340%
International Small Cap $760,136 .620%
ADVISORY FEES PAID
For the year ended December 31, 1997, the Portfolios paid the Adviser the
following advisory fees:
Dollar Amount Percent of Average Net Assets
Growth $935,029 .850%
Worldwide Growth $124,952 1.000%
Balanced $1,261,070 .800%
International Small Cap $1,347,708 1.100%
For the year ended December 31, 1997, 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
Growth $440,014 .400%
Worldwide Growth $49,981 .400%
Balanced $723,760 .460%
International Small Cap $587,572 .480%
PRIOR TRUSTEES AND SHAREHOLDER APPROVAL OF THE OLD AGREEMENT
The Old Subadvisory Agreement was most recently approved by the Board of
Trustees at a meeting held June 26, 1997 in connection with the annual review of
the Old Subadvisory Agreement. The Old Subadvisory Agreement was most recently
approved by shareholders at a meeting held on March 1, 1996, in the case of the
International Small Cap Trust, at a meeting held on July 12, 1996 in case of the
Growth Trust, and at a meeting held on January 1, 1997, in the case of the
Worldwide Growth and Balanced Trusts. These shareholder approvals occurred in
connection with the initial approval of the Old Subadvisory Agreement by the
sole shareholder of these Trusts.
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OWNERSHIP OF THE TRUST
As of April 1, 1998, 100% of the Trust's shares were legally owned by four
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,
(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 and
(iv) The Manufacturers Life Insurance Company (U.S.A.), a stock life
insurance company organized under the laws of Pennsylvania and redomesticated
under the laws of Michigan whose address is 500 North Wood ward Avenue,
Bloomfield Hills, Michigan 48304 ("ManUSA").
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 One, Two, Three and Four, which are
separate accounts registered under the 1940 Act. ManUSA holds Trust shares in
several unregistered separate accounts.
The ultimate controlling parent of Manulife New York, Manulife North America,
Manufacturers America and ManUSA 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.
No Trustees or officers of the Trust, have any interest in any contract the
reserves for which are invested in the Trust.
MANAGEMENT AND CONTROL OF FOUNDERS LLC
Founders LLC is a 90%-owned indirect subsidiary of Mellon Bank,
N.A.("Mellon Bank"), with the remaining 10% held by certain Founders LLC
executives and Portfolio Managers. Mellon Bank in turn is a direct, wholly-owned
subsidiary of Mellon Bank Corporation ("Mellon"). The business address of
Founders LLC is 2930 East Third Avenue, Denver, Colorado 80206.
Mellon is a broad-based financial services company whose principal business
address is One Mellon Bank Center, Pittsburgh, Pennsylvania 15258. Mellon ranks
among the largest bank holding companies in the U.S. based on market
capitalization. Mellon also owns The Dreyfus Corporation, a mutual fund company.
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The names, titles and principal occupation of the current executive
officers and members of the Board of Managers of Founders LLC are as follows:
Name Title and Principal Occupation
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Canter, Stephen Edward(1) Member, Board of Managers of Founders LLC;
Vice Chairman and Chief Investment Officer-The
Dreyfus Corporation
Christoffersen, Kenneth Ross Vice President and General Counsel, Secretary
Condron, Christopher Mark(1) Member, Board of Managers of Founders LLC;
Vice Chairman and Chief Operating Officer,
Mellon Bank Corporation; President, Chief
Executive Officer, Chief Operating Officer and
Director-The Dreyfus Corporation
Contillo, Gregory Paul Member, Board of Managers, and Sr. Vice
President-Institutional Marketing
Gaffney, Frank Vice Preisdent, MIS & Telecommunications
Galindo, Jr., Roberto Assistant Vice President-Accounting
Garrity, Laurine Vice President-Marketing
Gerding, Michael Wayne Vice President-Investments
Haines, Michael Kenneth Sr. Vice President-Investments
Kash, Lawrence Stout(1) Member, Board of Managers of Founders LLC;
Vice Chairman of Distribution-The Dreyfus
Corporation and President, The Boston Company
Keely, Edward Francis Vice President-Investments
Kelly, Brian Francis Vice President-Investments
Rankin, James Patrick Vice President-Investor Services
Ray, David Lamar Vice President-Administration, Treasurer and
Assistant Secretary
Ripley, Linda Mertensotto Vice President-Investments
Shapiro, Steven Vice President-Communications
Zeschin, Jonathan Frederick Member, Board of Managers of Founders, President
and Chief Executive Officer
(1) The business address of each of these persons is 200 Park Avenue, New York,
New York 10166.
The business address for all other persons is 2930 East Third Avenue, Denver,
Colorado 80206.
BROKERAGE TRANSACTIONS
Pursuant the Subadvisory Agreements, Founders LLC is responsible for
placing all orders for the purchase and sale of portfolio securities of the
Portfolios. Founders LLC has no formula for the distribution of the Portfolio's
brokerage business, its 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,
Founders gives 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 dealers, Founders also gives 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, Founders
may use a broker whose commission in effecting the transaction is higher than
that of some other broker if Founders 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 Founders' overall responsibilities with respect to the
Portfolios and any other accounts managed by Founders.
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To the extent research services are used by Founders in rendering
investment advice to the Portfolios, such services would tend to reduce
Founders' expenses. However, Founders does not believe that an exact dollar
value can be assigned to these services. Research services received by Founders
from brokers or dealers executing transactions for the Trust will be available
also for the benefit of other portfolios managed by Founders.
For the year ended December 31, 1997, the Trust for all portfolios paid
brokerage commissions in connection with portfolio transactions of $14,209,750,
including the following commissions paid in connection with the Portfolios:
Portfolios Brokerage Commissions Paid
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Growth $352,035
Worldwide Growth $ 73,362
Balanced $588,464
International Small Cap $420,472
OTHER INVESTMENT COMPANIES ADVISED BY FOUNDERS LLC
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Fund Investment Investment Advisory Fee Sub-Advisory Fee Net Assets as of
Objective February 28, 1998
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INTERNATIONAL SMALL CAP TRUST
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Founders Passport Fund Capital 1.00% to $250 million None $ 125,946,396.53
appreciation 0.80% next $250 million
0.70% thereafter
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American Skandia Trust - Capital 1.00% 0.60% to $100 million $ 121,517,612.76
Founders Passport Portfolio appreciation 0.50% thereafter
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American Skandia Advisor Capital growth 1.10% to $100 million 0.60% to $100 million $ 1,807,011.99
Funds, Inc. - ASAF Founders 1.00% thereafter 0.50% thereafter
International Small
Capitalization Fund
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North American Funds - Long-term capital 1.05% to $50 million 0.65% to $50 million $ 16,808,763.81
International Small Cap Fund appreciation 1.00% next $150 million 0.60% next $150 million
0.90% next $300 million 0.50% next $300 million
0.80% thereafter 0.40% thereafter
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WORLDWIDE GROWTH TRUST
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Founders International Equity Long-term growth 1.00% to $250 million None $ 17,582,767.56
Fund of capital 0.80% next $250 million
0.70% therafter
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Founders Worldwide Growth Long-term growth 1.00% to $250 million None $ 325,227,052.82
Fund of capital 0.80% next $250 million
0.70% thereafter
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New England Funds Trust I - Long-term growth 1.05% 0.65% to $50 million $ 56,244,865.35
New England Star Worldwide of capital 0.60% next $50 million
Fund(1) 0.55% thereafter
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GROWTH TRUST
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Founders Growth Fund Long-term growth 1.00% to $30 million None $1,967,592,363.66
of capital 0.75% next $270 million
0.70% next $200 million
0.65% thereafter
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New England Funds Trust I - Long-term growth of 1.05% 0.55% to $50 million $ 287,664,215.40
New England Star Advisers capital 0.50% next $200 million
Fund(1) 0.475% thereafter
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North American Funds - Growth Long-term growth of 0.90% to $50 million 0.50% to $50 million $ 28,593,432.82
Equity Funds capital 0.85% next $150 million 0.45% next $150 million
0.825% next $300 million 0.425% next $300 million
0.80% thereafter 0.40% thereafter
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BALANCED TRUST
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Founders Balanced Fund Current income and 0.65% to $250 million None $1,090,669,960.41
capital appreciation 0.60% next $250 million
0.55% next $250 million
0.50% thereafter
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North American Funds - Current income and 0.775% to $50 million 0.375% to $50 million $ 102,806,169.07
Balanced Fund capital appreciation 0.725% next $150 million 0.325% next $150 million
0.675% next $300 million 0.275% next $300 million
0.625% thereafter 0.225% thereafter
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(1) This fund has four sub-advisers, each managing a different segment of the
fund's portfolio. The net asset amount shown for this fund reflects only
Founders LLC's segment.
OTHER MATTERS
The Trust will furnish, without charge, a copy of the Trust's annual report
for the fiscal year ended December 31, 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 ("MSS"), the adviser to the Trust,
is located at 73 Tremont Street, Boston, Massachusetts 02108. The Trust does not
have a principal underwriter or administrator since shares are sold only to
insurance companies and their separate accounts as the underlying investment
medium for variable contracts. However, MSS and an affiliated broker dealer
serve as principal underwriter of certain contracts issued by affiliates of the
Trust.
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 Founders LLC for these expenses.
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