SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14a-6
(e)(2))
[X] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
ULTRA SERIES FUND
(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.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which
transaction applies:
2) Aggregate number of securities to which transaction
applies:
3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule
0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
ULTRA SERIES FUND
MONEY MARKET FUND
BOND FUND
HIGH INCOME FUND
BALANCED FUND
GROWTH AND INCOME STOCK FUND
CAPITAL APPRECIATION STOCK FUND
MID-CAP STOCK FUND
MULTI-CAP GROWTH STOCK FUND
GLOBAL SECURITIES FUND
INTERNATIONAL STOCK FUND
January 31, 2005
Dear Beneficial Owner:
On March 17, 2005, a special meeting of the shareholders of the mutual funds
listed above (each a "Portfolio" and collectively the "Portfolios") will be held
at 5810 Mineral Point Road, Madison, Wisconsin, at 3:00 p.m. Central time to
vote on the following proposals:
- Shareholders of the Portfolios, voting together as a single group,
are being asked to elect Trustees for Ultra Series Fund ("USF").
- Shareholders of the Portfolios, voting together as a single group,
are being asked to ratify the appointment of the accounting firm of
Deloitte & Touche LLP to serve as independent registered public
accounting firm for USF for the fiscal year ending December 31,
2005.
- Shareholders of each Portfolio, voting together as a single group,
are being asked to approve three amendments to USF's Declaration of
Trust.
- Shareholders of each Portfolio, voting separately on a
Portfolio-by-Portfolio basis, are being asked to approve eight
changes to the fundamental investment limitations of USF.
Each Portfolio is a series of USF, which is an underlying investment vehicle
used by variable annuity and variable life insurance contracts and accounts of
the companies of CUNA Mutual Group. As the owner of such a variable life
insurance or variable annuity contract or account or as the administrator or
trustee of a qualified pension or retirement plan which owns such variable life
insurance or variable annuity contract or account (a "Beneficial Owner"), you
are an indirect participant in one or more of the Portfolios and are eligible to
provide instructions on how to vote on these proposals.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT BENEFICIAL OWNERS OF EACH PORTFOLIO VOTE
FOR EACH OF THE TRUSTEE NOMINEES, FOR RATIFICATION OF THE APPOINTMENT OF
DELOITTE & TOUCHE LLP TO SERVE AS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
FOR USF, FOR EACH OF THE THREE PROPOSED AMENDMENTS TO THE DECLARATION OF TRUST,
AND FOR EACH OF THE EIGHT PROPOSED CHANGES TO USF'S FUNDAMENTAL INVESTMENT
LIMITATIONS.
Whether or not you plan to attend the meeting, please fill out, sign and return
your voting instruction card in the envelope provided so that your vote may be
counted. You can also vote easily and quickly by toll-free telephone call or by
internet. Just follow the instructions that appear on your enclosed voting
instruction card. YOUR VOTE IS EXTREMELY IMPORTANT, NO MATTER HOW LARGE OR SMALL
YOUR HOLDINGS MAY BE. Please read the entire proxy statement carefully before
you vote.
Thank you for your prompt attention and participation.
Sincerely,
Michael S. Daubs
President
Ultra Series Fund
ULTRA SERIES FUND
5910 Mineral Point Road
Madison, Wisconsin 53705
MONEY MARKET FUND
BOND FUND
HIGH INCOME FUND
BALANCED FUND
GROWTH AND INCOME STOCK FUND
CAPITAL APPRECIATION STOCK FUND
MID-CAP STOCK FUND
MULTI-CAP GROWTH STOCK FUND
GLOBAL SECURITIES FUND
INTERNATIONAL STOCK FUND
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To be held on March 17, 2005
Notice is hereby given that a Special Meeting of Shareholders of the mutual
funds listed above (each a "Portfolio" and collectively the "Portfolios"), each
of which is a series of Ultra Series Fund ("USF" or the "Fund"), will be held at
5810 Mineral Point Road, Madison, Wisconsin, on March 17, 2005 at 3:00 p.m.
Central time, for the purposes of considering the proposals set forth below.
1. To elect Trustees for USF.
2. To ratify the appointment of the accounting firm of Deloitte &
Touche LLP to serve as independent registered public accounting firm
for USF for the fiscal year ending December 31, 2005.
3. To approve three amendments to USF's Declaration of Trust.
4. To approve eight changes to the fundamental investment limitations
of USF.
5. To transact any other business that properly comes before the
meeting and any adjournments of the meeting.
SHAREHOLDERS OF RECORD OF EACH PORTFOLIO AS OF THE CLOSE OF BUSINESS ON JANUARY
18, 2005 ARE ENTITLED TO NOTICE OF, AND TO VOTE AT, THIS MEETING OR ANY
ADJOURNMENT OF THIS MEETING.
Each Portfolio issues and sells its shares to variable annuity and variable life
insurance contracts and accounts of the companies of CUNA Mutual Groups. These
separate contracts and accounts hold shares of mutual funds, including the
Portfolios, which fund benefits under variable annuity contracts or variable
life insurance contracts issued by the insurance companies. As the record owners
of the assets held in the separate accounts, these variable annuity and variable
life insurance contracts and accounts are the sole shareholders of the
Portfolios and are entitled to vote all of the shares of each Portfolio.
However, pursuant to applicable laws, contracts, or other arrangements, the
insurance companies vote outstanding shares of the Portfolios in accordance with
instructions received from the owners of the annuity and life insurance
contracts and accounts and from the administrators or trustees of qualified
pension or retirement plans which own such variable annuity or life insurance
contracts or accounts (the "Beneficial Owners").
This Notice is being delivered to Beneficial Owners as of the record date, so
that they may instruct the record owners how to vote the shares of the
Portfolios. Beneficial Owners of all of the Portfolios will vote together as a
single group to elect the Trustees of USF, to ratify the selection of the
accounting firm of Deloitte & Touche LLP to serve as independent registered
public accounting firm for USF, and to approve the proposed amendments to USF's
Declaration of Trust. Beneficial Owners of each of the Portfolios will vote
separately to approve changes to the fundamental investment limitations of USF.
BENEFICIAL OWNERS ARE REQUESTED TO EXECUTE AND RETURN PROMPTLY THE ACCOMPANYING
VOTING INSTRUCTION CARD, WHICH IS BEING SOLICITED BY THE BOARD OF TRUSTEES OF
USF. BENEFICIAL OWNERS ALSO CAN VOTE EASILY AND QUICKLY BY TOLL-FREE TELEPHONE
CALL OR BY INTERNET. JUST FOLLOW THE INSTRUCTIONS THAT APPEAR ON THE ENCLOSED
VOTING INSTRUCTION CARD. INSTRUCTIONS MAY BE REVOKED AT ANY TIME BEFORE THEY ARE
EXERCISED BY SUBMITTING A WRITTEN NOTICE OF REVOCATION OR A LATER-DATED
INSTRUCTION CARD OR BY ATTENDING THE MEETING AND VOTING IN PERSON.
By Order of the Trustees:
Holly S. Baggot
Secretary
Dated: January 31, 2005
ULTRA SERIES FUND
5910 Mineral Point Road
Madison, WI 53705
Money Market Fund Capital Appreciation Stock Fund
Bond Fund Mid-Cap Stock Fund
High Income Fund Multi-Cap Growth Stock Fund
Balanced Fund Global Securities Fund
Growth and Income Stock Fund International Stock Fund
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
MARCH 17, 2005
This proxy statement is furnished in connection with the solicitation of voting
instructions by the Trustees of Ultra Series Fund ("USF" or the "Fund") for the
Special Meeting of Shareholders of the mutual funds listed above (each a
"Portfolio" and collectively the "Portfolios"), to be held on March 17, 2005 at
3:00 p.m. Central time, at 5810 Mineral Point Road, Madison, Wisconsin.
SUMMARY OF PROPOSALS
The following table illustrates which proposals are to be voted on by
shareholders of each Portfolio:
PROPOSAL PORTFOLIO
- ------------------------------------ ---------------------------------------------------------------------------------------------
Growth Capital Multi-
and Apprec- Mid- Cap
Money High Bal- Income iation Cap Growth Global Int'l
Market Bond Income anced Stock Stock Stock Stock Securities Stock
Fund Fund Fund Fund Fund Fund Fund Fund Fund Fund
------ ---- ------ ----- ------ -------- ----- ------ ---------- -----
Elect Trustees X X X X X X X X X X
Ratify Independent Registered X X X X X X X X X X
Public Accounting Firm
AMENDMENTS TO DECLARATION OF TRUST
Revise Section 9.2 - Votes to Elect
Trustees X X X X X X X X X X
Revise Section 13.1 - Votes to Amend
Declaration of Trust X X X X X X X X X X
Eliminate Section 4.4 - Votes to
Change Investment Objectives,
Policies, and Limitations X X X X X X X X X X
CHANGES TO FUNDAMENTAL INVESTMENT LIMITATIONS
Revise Limitation #4 to allow the
Portfolios to trade in "commodities"
which do not require delivery or
receipt of physical commodities X X X X X X X X X X
Eliminate Limitation #5 so the
Portfolios are only subject to the
diversification requirements of the
1940 Act X X X X X X X X X X
Eliminate Limitation #6 to allow the
Portfolios, with Board approval, to
invest in securities for the purpose
of exercising control or management X X X X X X X X X X
1
PROPOSAL PORTFOLIO
- ------------------------------------ ---------------------------------------------------------------------------------------------
Growth Capital Multi-
and Apprec- Mid- Cap
Money High Bal- Income iation Cap Growth Global Int'l
Market Bond Income anced Stock Stock Stock Stock Securities Stock
Fund Fund Fund Fund Fund Fund Fund Fund Fund Fund
------ ---- ------ ----- ------ -------- ----- ------ ---------- -----
CHANGES TO FUNDAMENTAL INVESTMENT LIMITATIONS (CONTINUED)
Eliminate Limitation #7 so the
Portfolios are only subject to 1940
Act limitations on Portfolio
investments in other investment
companies X X X X X X X X X X
Revise Limitation #9 to permit the
Portfolios to issue senior
securities to the extent allowed
under the 1940 Act X X X X X X X X X X
Combine and amend Limitation #10 and
#12, each addressing loans by the
Portfolios X X X X X X X X X X
Eliminate Limitation #11 so the
Portfolios are only subject to 1940
Act limitations on Portfolio
investments in illiquid securities X X X X X X X X X X
Eliminate Limitation #13 to allow
Board to change limitations on
Portfolio investments in foreign
securities without shareholder
approval X X X X X X X X X X
VOTING AND OTHER GENERAL INFORMATION
GENERAL INFORMATION
MEMBERS Capital Advisors, Inc. acts as the investment advisor to each of the
Portfolios. In addition to providing portfolio management services, MEMBERS
Capital Advisors also provides or arranges for the provision of substantially
all other services required by the Portfolios, including all administrative,
accounting, and legal services, as well as the services of custodians, transfer
agents, and dividend disbursing agents. The address of MEMBERS Capital Advisors
is 5910 Mineral Point Road, Madison, Wisconsin.
This solicitation is being made primarily by the mailing of this proxy statement
and the accompanying voting instruction card. Supplementary solicitations may be
made by mail, telephone, facsimile, electronic means or by personal interview by
representatives of MEMBERS Capital Advisors. The cost of preparing, printing and
mailing the proxy statement, and all other costs incurred in connection with the
solicitation of proxies, will be paid by the Portfolios.
VOTING RIGHTS
For a shareholder meeting to go forward, there must be a quorum. This means that
at least a majority of the votes entitled to be cast at a meeting of
shareholders must be represented at that meeting, either in person or by proxy.
Where the holders of shares of any Portfolio are entitled or required to vote as
a separate Portfolio, the presence in person or by proxy of the holders of a
majority of the votes of such Portfolio entitled to be cast the meeting shall
constitute a quorum for that vote.
Because variable annuity and variable life insurance contracts and accounts of
the companies of CUNA Mutual Group own of record all of the shares of each
Portfolio, their presence at the meeting in person or by proxy will meet the
quorum requirement. If sufficient votes to approve a proposal are not obtained
for any Portfolio, the proxies may propose one or more adjournments of the
meeting with respect to that Portfolio to permit further solicitation of voting
instructions. Any adjournment will require a vote in favor of the adjournment by
the holders of a majority of the votes represented in person or by proxy at the
meeting (or any adjournment of the meeting).
2
Shareholders of each Portfolio are entitled to one vote for each dollar of net
asset value of the Fund standing in his or her name on the books of the Fund on
the record date for the special meeting. However, as discussed herein, under the
Fund's Declaration of Trust in its current form, it is unclear whether
shareholder votes on the election of Trustees and on amendments to the
Declaration of Trust should to be counted on a one dollar/one vote basis, or on
a one share/one vote basis. For this reason, votes on the election of Trustees
and on the amendments to the Declaration of Trust which are proposed herein will
be counted on both bases. A proposal pertaining to those matters will not be
deemed to have been approved unless it is approved counting votes both ways.
Due to the pass-through voting structure of the variable annuity and variable
life insurance contracts and accounts the insurance companies will vote shares
in the separate contracts and accounts. However, they are required by law to
request voting instructions from the owners of the annuity and life insurance
contracts and accounts and from the administrators or trustees of qualified
pension or retirement plans which own such variable annuity or life insurance
contracts or accounts (the "Beneficial Owners"). They also must vote shares in
the separate accounts on behalf of the Beneficial Owners, including shares for
which no instructions have been received, in proportion to the voting
instructions received.
You may revoke your voting instructions at any time up until voting results are
announced at the shareholders meeting. You can do this by writing to the
Secretary of USF, or by submitting a later-dated voting instruction card, or by
providing voting instructions in person at the meeting and notifying the
election judge that you are revoking your prior instructions. If you return an
executed voting instruction card without instructions, your shares will be voted
"for" each proposal.
None of the matters to be presented at the meeting will entitle any shareholder
to cumulative voting or appraisal rights.
RECORD DATE AND OUTSTANDING SHARES
Only shareholders of record of the Portfolios at the close of business on
January 18, 2005 (the "Record Date") are entitled to notice of and to vote at
the meeting and any postponement or adjournment thereof. On that date, each
Portfolio had the following number and dollar value of shares outstanding and
entitled to vote:
TOTAL DOLLAR
TOTAL NUMBER OF AMOUNT OF SHARES
PORTFOLIO SHARES OUTSTANDING OUTSTANDING
- ------------------------------------------------------------- ------------------ -------------------
Money Market Fund............................................ 129,223,413.239 $129,223,413.24
Bond Fund.................................................... 55,613,680.450 $576,836,828.11
High Income Fund............................................. 11,469,685.371 $118,649,961.06
Balanced Fund................................................ 41,146,231.757 $780,800,357.45
Growth and Income Stock Fund................................. 39,464,382.488 $1,191,020,816.85
Capital Appreciation Stock Fund.............................. 35,229,148.736 $684,988,486.96
Mid-Cap Stock Fund........................................... 13,225,392.975 $213,927,145.69
Multi-Cap Growth Stock Fund.................................. 49,541,334.375 $329,905,455.70
Global Securities Fund....................................... 2,657,125.263 $29,483,775.46
International Stock Fund..................................... 6,960,873.972 $77,940,397.72
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The officers and Trustees of USF cannot directly own shares of the Portfolios,
and they cannot beneficially own shares unless they purchase an insurance
contract through a participating insurance company or are a beneficiary of a
participating qualified retirement plan. As of the Record Date, the officers and
Trustees of USF as a group beneficially owned less than one percent of the
outstanding shares of each Portfolio, and the companies of CUNA Mutual Group,
for themselves and through its separate accounts, and certain qualified plans
were the only shareholders of the Trust. As of the Record Date, no one person
was known by management to have a beneficial interest in any of the Portfolios
exceeding five percent, except as follows:
PORTFOLIO NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF SHARES PERCENTAGE OWNERSHIP
- --------- ------------------------------------ ---------------- --------------------
BOND FUND CUNA Mutual Insurance Society
Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 11,753,134.936 21.1%
CUNA Mutual Insurance Society
Master Trust for Represented
Employees, State Street as Trustee
Madison, WI 3,768,041.160 6.8%
- -------------------------------------------------------------------------------------------------------------------------
HIGH INCOME FUND CUNA Mutual Insurance Society
Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 2,028,832.335 17.7%
CUNA Mutual Insurance Society
Master Trust for Represented
Employees, State Street as Trustee
Madison, WI 662,948.585 5.8%
CUNA Mutual Life Insurance Co.
Madison, WI 661,379.857 5.8%
CUNA Mutual Insurance Society
Madison, WI 661,379.848 5.8%
- -------------------------------------------------------------------------------------------------------------------------
3
<Table>
<Caption>
GROWTH & INCOME STOCK FUND CUNA Mutual Insurance Society
Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 2,589,058.673 6.6%
- -------------------------------------------------------------------------------------------------------------------------
CAPITAL APPRECIATION CUNA Mutual Insurance Society
STOCK FUND Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 2,702,458.858 7.7%
- -------------------------------------------------------------------------------------------------------------------------
MID-CAP STOCK FUND CUNA Mutual Insurance Society
Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 870,710.701 6.6%
- -------------------------------------------------------------------------------------------------------------------------
MULTI-CAP GROWTH CUNA Mutual Insurance Society
STOCK FUND Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 7,312,626.814 14.8%
- -------------------------------------------------------------------------------------------------------------------------
GLOBAL SECURITIES FUND CUNA Mutual Life Insurance Co.
Madison, WI 510,025.541 19.2%
CUNA Mutual Insurance Society
Madison, WI 510,025.562 19.2%
- -------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL STOCK CUMIS Insurance Society, Inc.
Madison, WI 1,773,876.987 25.5%
CUNA Mutual Insurance Society
Master Trust for Non-Represented
Employees, State Street as Trustee
Madison, WI 1,297,314.047 18.6%
CUNA Mutual Insurance Society
Master Trust for Represented
Employees, State Street as Trustee
Madison, WI 407,492.874 5.9%
- -------------------------------------------------------------------------------------------------------------------------
OTHER BUSINESS
The Trustees know of no other business to be brought before the meeting.
However, if any other matters come before the meeting, voting instruction cards
that do not contain specific restrictions to the contrary will be voted on such
matters in accordance with the judgment of the persons named in the voting
instruction cards.
SHAREHOLDER PROPOSALS
The Portfolios do not hold annual or other regular meetings of shareholders.
Since the Portfolios do not hold regular meetings of shareholders, the
anticipated date of the next shareholders meeting of the Portfolios cannot be
provided. To be considered for inclusion in the proxy statement for any
subsequent meeting of shareholders, a shareholder proposal must be submitted a
reasonable time before the proxy statement for that meeting is mailed. Whether a
proposal is included in the proxy statement will be determined in accordance
with applicable federal and state laws. The timely submission of a proposal does
not guarantee its inclusion.
The Portfolios' most recent annual and semiannual reports are available at no
cost. To request a report, please contact CUNA Mutual Life Insurance Company at
2000 Heritage Way, Waverly, Iowa 50677 or call 1-800-798-5500.
Please be sure to read the entire proxy statement before casting your vote. This
proxy statement and the accompanying voting instruction card were first mailed
to Beneficial Owners on or about January 31, 2005.
PROPOSAL ONE
ELECTION OF TRUSTEES
Shareholders are being asked to elect the nominees listed below to the Board of
Trustees of USF. Five current Trustees, Michael S. Daubs, Lawrence R. Halverson,
Rolf F. Bjelland, Gwendolyn M. Boeke, and Richard E. Struthers, are being
submitted for election by the shareholders at the special meeting. One
additional, non-incumbent nominee, Steven P. Riege, also has been nominated to
the Board of Trustees. If elected, each nominee will serve as Trustee until his
or her successor has been elected and qualified to serve as Trustee or until
such time as the Trustee resigns or is removed in accordance with the USF
Declaration of Trust.
At a meeting held on December 28, 2004, the Board of Trustees nominated the
Trustee nominees listed in the table below. All nominees have consented to serve
as Trustees upon their election, but if any of them should decline or be unable
to act as a Trustee, the persons named as proxies may vote in favor of such
other person or persons as the Board may recommend.
Each nominee for Trustee of USF is listed below, together with information
regarding such nominee's principal occupation and business experience during the
past five years. Unless otherwise indicated, all positions have been held more
than five years.
4
NUMBER OF
PORTFOLIOS IN
FUND COMPLEX
OVERSEEN BY OTHER
NAME, POSITION(S) TERM OF OFFICE TRUSTEE OR DIRECTOR-SHIPS
ADDRESS AND HELD AND LENGTH OF PRINCIPAL OCCUPATION(S) DURING PAST NOMINEE FOR HELD BY
YEAR OF BIRTH WITH USF TIME SERVED (1) 5 YEARS TRUSTEE (2) TRUSTEE (3)
- ----------------------- ------------ --------------- ----------------------------------- -------------- --------------
INTERESTED TRUSTEE NOMINEES
MICHAEL S. DAUBS (4) Trustee, 1983 - present CUNA Mutual Insurance Society, 19 None
5910 Mineral Point Rd. Chairman and Chief Officer - Investments, 1990 -
Madison, WI 53705 Principal present
Year of Birth: 1943 Executive
Officer MEMBERS Capital Advisors, Inc.,
President, 1982 - present
CUNA Mutual Life Insurance Company,
Chief Officer - Investments, 1973 -
present
LAWRENCE R. HALVERSON (4) Trustee and 1983 - present MEMBERS Capital Advisors, Inc., 19 None
5910 Mineral Point Rd. Vice Senior Vice President, Equities,
Madison, WI 53705 President 1996 - present
Year of Birth: 1945
DISINTERESTED TRUSTEE NOMINEES
ROLF F. BJELLAND Trustee 2003 - present Retired; Lutheran Brotherhood 19 Regis Corp.,
5910 Mineral Point Rd. Mutual Funds, Chairman and Director
Madison, WI 53705 President, 1983 - 2002; Lutheran 1982 -
Year of Birth: 1938 Brotherhood (now Thrivent present
Financial), Chief Investment
Officer, to 2002
A.L.S. Society, Treasurer, 2002 -
present
GWENDOLYN M. BOEKE Trustee 1983 - present Wartburg Theological Seminary, 19 None
5910 Mineral Point Rd. Development Associate, 1997 - 2003
Madison, WI 53705
Year of Birth: 1934 Evangelical Lutheran Church in
America, Regional Director, 1990 -
2000
Wartburg College, Director, 1986 -
2001
RICHARD E. STRUTHERS Trustee September Clearwater Capital Management, 19 None
5910 Mineral Point Rd. 2004 - present Chairman/Chief Executive Officer,
Madison, WI 53705 1998 - present
Year of Birth: 1952
STEVEN P. RIEGE (5) Trustee Nominee The Rgroup (management consulting), 19 None
5910 Mineral Point Rd. Nominee owner and President, 2001 - present
Madison, WI 53705
Year of Birth: 1954 Robert W. Baird & Co., Senior Vice
President Marketing and First Vice
President Human Resources, 1986 -
2001
- ----------------
(1) At its August 2003 meeting, the Board of Trustees of the Fund adopted term
limitations authorizing each of the Fund's Trustees to serve in such
capacity until the first to occur of such Trustee (1) serving one
twelve-year term as Trustee, or (2) reaching the age of 72; provided
however, that no disinterested Trustee serving on the Fund's Board on the
date of adoption of such term limitations is required to resign pursuant
to such the adoption of such limitations prior to September 30, 2004
(2) The fund complex consists of the Fund, with 10 portfolios, and MEMBERS
Mutual Funds, with 9 portfolios.
(3) Includes only directorships with companies that have a class of securities
registered with the SEC under Section 12 of the Securities Exchange Act of
1934; or are subject to the requirements of Section 15(d) of such Act; or
are registered as an investment company.
(4) Considered an "interested" Trustee because of the position he holds with
the investment advisor of the Fund.
(5) Mr. Riege also is a nominee as Trustee of MEMBERS Mutual Funds.
5
The Board of Trustees of USF has overall responsibility for managing the Fund in
good faith and in a manner reasonably believed to be in the best interests of
the Fund. The Trustees meet periodically throughout the year to oversee the
Fund's activities, review contractual arrangements with companies that provide
services to the Fund, and review the performance of the Fund and its Portfolios.
The Trustees held six meetings during the fiscal year ended December 31, 2004.
Each incumbent Trustee attended at least 75% of the aggregate of (1) the total
number of meetings of the Board of Trustees (held during the period for the
Trustee was a Trustee) and (2) the total number of meetings held by all
committees of the Board on which the Trustee served (during the periods that the
Trustee served).
Shareholders wishing to communicate with the Board or individual Trustees should
send such correspondence to the Board or to such individual Trustee, c/o MEMBERS
Capital Advisors, 5910 Mineral Point Road, Madison, WI 53705. All such
shareholder communications will be forwarded directly to the applicable Board
member(s) without being screened. The Fund currently does not have a policy with
respect to Board members' attendance at shareholder meetings. The audit; discuss
matters of concern relating to the Fund's financial statements, including any
adjustments to such statements recommended by the independent registered public
accounting firm, or other results of the audit; consider the independent
registered public accounting firms' comments and suggestions with respect to the
Fund's financial policies, accounting procedures and internal accounting
controls; and review the form of audit opinion the accountants propose to render
to the Fund.
The Audit Committee also reviews any memoranda prepared by the independent
registered public accounting firm setting forth any recommended procedural
changes; considers the effect upon the Fund of any changes in accounting
principles or practices proposed by management or the independent registered
public accounting firm; reviews audit and non-audit services provided to the
Fund by the independent registered public accounting firm and the fees charged
for such services; considers whether to retain the accountants for the next
fiscal year and evaluates the independence of the accountants; and reports to
the Board of Trustees from time to time and makes such recommendations as the
committee deems necessary or appropriate.
The Audit Committee met three times during the last fiscal year. A copy of the
Audit Committee Charter is included as Exhibit A to this Proxy Statement.
The Board of Trustees does not have a separate Nominating Committee due to the
Board's relatively small size. Instead, the independent Trustees meet separately
in executive session to discuss any vacancies or nominations to the Board of
Trustees. Mr. Bjelland, Ms. Boeke, and Mr. Struthers participated in the
consideration of Trustee nominees.
The independent Trustees utilize the following process in selecting Trustee
nominees: The independent Trustees (meeting, if they wish, with invited
representatives of Fund management) consider the characteristics and qualities
of possible candidates. The independent Trustees (or a subgroup thereof) then
interview potential candidates. If only a subgroup meets with a candidate, a
report is provided to the other independent Trustees. After the independent
Trustees reach an agreement on a particular candidate or candidates, they make a
recommendation to the full Board of Trustees. The full Board of Trustees then
votes on the new candidate or candidates.
The Trustees have not adopted a formal policy or process with regard to the
consideration of Trustee candidates recommended by Fund shareholders, since
shareholders have not made such recommendations. However, if such a
recommendation was received, the Trustees anticipate that they would consider it
if a Board vacancy existed at that time, as part of the process described in the
preceding paragraph and on the same basis as other candidates.
The Fund has an Audit Committee of the Board of Trustees, the members of which
are all Trustees who are not "interested persons" of the Fund, as defined in
Section 2(a)(19) of the Investment Company Act of 1940 ("independent Trustees").
Mr. Bjelland, Ms. Boeke, and Mr. Struthers currently comprise the members of the
Audit Committee.
The Audit Committee, which has adopted and operates in accordance with a
separate Audit Committee Charter, has as its purposes to meet with the Fund's
independent registered public accounting firm to review the arrangements for and
scope of the audit; discuss matters of concern relating to the Fund's financial
statements, including any adjustments to such statements recommended by the
independent registered public accounting firm, or other results of the audit;
consider the independent registered public accounting firm comments and
suggestions with respect to the Fund's financial policies, accounting procedures
and internal accounting controls; and review the form of audit opinion the
accountants propose to render to the Fund.
The Audit Committee also reviews any memoranda prepared by the independent
registered public accounting firm setting forth any recommended procedural
changes; considers the effect upon the Fund of any changes in accounting
principles or practices proposed by management or the independent registered
public accounting firm; reviews audit and non-audit services provided to the
Fund by the independent registered public accounting firm and the fees charged
for such services; considers whether to retain the accountants for the next
fiscal year and evaluates the independence of the accountants; and reports to
the Board of Trustees from time to time and makes such recommendations as the
committee deems necessary or appropriate.
The Audit Committee met three times during the last fiscal year. A copy of the
Audit Committee Charter is included as Exhibit A to this Proxy Statement.
The Board of Trustees does not have a separate Nominating Committee due to the
Board's relatively small size. Instead, the independent Trustees meet separately
in executive session to discuss any vacancies or nominations to the Board of
Trustees. Mr. Bjelland, Ms. Boeke, and Mr. Struthers participated in the
consideration of Trustee nominees.
The independent Trustees utilize the following process in selecting Trustee
nominees: The independent Trustees (meeting, if they wish, with invited
representatives of Fund management) consider the characteristics and qualities
of possible candidates. The independent Trustees (or a subgroup thereof) then
interview potential candidates. If only a subgroup meets with a candidate, a
report is provided to the other independent Trustees. After the independent
Trustees reach an agreement on a particular candidate or candidates, they make a
recommendation to the full Board of Trustees. The full Board of Trustees then
votes on the new candidate or candidates.
The Trustees have not adopted a formal policy or process with regard to the
consideration of Trustee candidates recommended by Fund shareholders, since
shareholders have not made such recommendations. However, if such a
recommendation was received, the Trustees anticipate that they would consider it
if a Board vacancy existed at that time, as part of the process described in the
preceding paragraph and on the same basis as other candidates.
In identifying a candidate for the trusteeship to which Mr. Riege is nominated,
the independent Trustees considered individuals identified by themselves. The
independent Trustees also invited the Fund's investment advisor to submit names
for consideration. Mr. Riege's name was submitted for consideration by an
employee of the Fund's investment advisor.
The current Trustees and Trustee nominee beneficially owned shares in the Fund
in the following dollar ranges as of December 31, 2004:
DOLLAR RANGE OF EQUITY AGGREGATE DOLLAR RANGE
SECURITIES IN OF EQUITY SECURITIES IN
NAME OF TRUSTEE OR TRUSTEE NOMINEE ULTRA SERIES FUND (1) FUND COMPLEX (1), (2)
- ---------------------------------- ---------------------- -----------------------
INTERESTED TRUSTEES:
Michael S. Daubs Over $100,000 Over $100,000
Lawrence R. Halverson Over $100,000 Over $100,000
DISINTERESTED TRUSTEES:
Rolf F. Bjelland None $50,001 - $100,000
Gwendolyn M. Boeke None $10,000 - $50,000
Steven P. Riege None None
Richard E. Struthers None $10,000 - $50,000
(1) Dollar ranges are as follows: None; $1 - $10,000; $10,001 - $50,000; $50,001
- $100,000; and over $100,000.
(2) The fund complex consists of the Fund, with 10 portfolios, and MEMBERS
Mutual Funds, with 9 portfolios.
6
No compensation is paid by the Fund to any of its officers or Trustees who are
affiliated with MEMBERS Capital Advisors. Each Trustee who is not affiliated
with MEMBERS Capital Advisors receives compensation from all funds in the fund
complex (i.e. Ultra Series Fund and MEMBERS Mutual Funds together) pursuant to
the following schedule (in addition to reimbursement of travel expenses to
attend Trustees' and committee meetings):
Fee Per Regular Board Meeting: $4,750
Fee Per Audit Committee Meeting: $1,000
Fee Per Special Purpose/Telephone Board Meetings: $1,500
Lead Independent Director Fee (Annual): $5,000
Audit Committee Chairman Fee (Annual): $5,000
During the fiscal year ended December 31, 2004, each Trustee not affiliated with
MEMBERS Capital Advisors was compensated by the Fund as set forth in the
following table:
PENSION OR
RETIREMENT TOTAL
AGGREGATE BENEFITS ESTIMATED COMPENSATION
COMPENSATION ACCRUED AS ANNUAL FROM FUND AND
FROM PART OF FUND BENEFITS UPON FUND COMPLEX (1)
NAME OF TRUSTEE THE FUND EXPENSES RETIREMENT PAID TO TRUSTEES
- ---------------------- ------------ ------------ ------------- ----------------
Rolf F. Bjelland $15,250.00 n/a n/a $30,500
Gwendolyn M. Boeke $12,125.00 n/a n/a $24,250
Steven P. Riege (2) n/a n/a n/a n/a
Richard E. Struthers (3) $ 6,750.00 n/a n/a $13,500
(1) The fund complex consists of the Fund, with 10 portfolios, and MEMBERS
Mutual Funds, with 9 portfolios.
(2) Mr. Riege did not receive any compensation from the Fund or from the fund
complex during fiscal year 2004 because he was not a member of the Board of
Trustees during that time.
(3) Mr. Struthers joined the Board of Trustees in September 2004.
OFFICERS OF THE FUND
Michael S. Daubs and Lawrence R. Halverson, who are Trustees of the Fund, also
serve as the Principal Executive Officer and Vice President, respectively, of
the Funds. Information concerning them is set forth under the caption
"Interested Trustee Nominees" above. The other officers of the Funds are:
TERM OF OFFICE OTHER
NAME, ADDRESS AND POSITION(S) HELD AND LENGTH OF PRINCIPAL OCCUPATION(S) DURING DIRECTORSHIPS
YEAR OF BIRTH WITH USF TIME SERVED PAST 5 YEARS HELD (1)
- ----------------------- ------------------- -------------- -------------------------------- -------------
MARY E. HOFFMAN Treasurer 1998 - present MEMBERS Capital Advisors, Inc., None
5910 Mineral Point Road Assistant Vice President -
Madison, WI 53705 Finance & Operations, 2001 -
Year of Birth: 1970 present; Product Operations and
Finance Manager, 1998 - 2001
HOLLY S. BAGGOT Secretary and 1999 - present MEMBERS Capital Advisors, Inc., None
5910 Mineral Point Road Assistant Treasurer Senior Manager - Product and
Madison, WI 53705 Fund Operations, 2001 - present;
Year of Birth: 1960 Operations & Administration
Manager, 1998 - 2001
DAN P. OWENS Assistant Treasurer 2000 - present MEMBERS Capital Advisors, Inc., None
5910 Mineral Point Road Senior Manager - Portfolio
Madison, WI 53705 Operations, 2001 - present;
Year of Birth: 1966 Investment Operations Manager,
1999 - 2001
(1) Includes only directorships with companies that have a class of securities
registered with the SEC under Section 12 of the Securities Exchange Act of
1934; or are subject to the requirements of Section 15(d) of such Act; or
are registered as an investment company.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD RECOMMENDS THAT BENEFICIAL OWNERS VOTE FOR EACH OF THE TRUSTEE
NOMINEES.
Pursuant to Section 9.2 of the Declaration of Trust, Trustees are elected "by
the affirmative vote of the holders of at least a majority of the shares
entitled to vote present in person or by proxy" at the shareholders meeting. As
discussed in greater detail below, there presently is ambiguity in the
Declaration of Trust with respect to whether election of Trustees should be
based upon a vote of the shares held by shareholders or based upon the allowance
of one vote for each dollar of net asset value of the Fund held by each
shareholder, as set forth in Section 6.2(d) of the Declaration of Trust. In
other words, it is not clear whether the voting rule in the election of Trustees
is one share/one vote or one dollar/one vote.
Due to this ambiguity, this election of Trustees will be determined by both
methods. This means that each of the six Trustee nominees will be elected as
Trustee if (and only if) a majority of the shares present at the meeting vote
for the Trustee and if a majority of the votes (based upon one vote for
7
each dollar of net asset value) also are cast in favor of the Trustee. In the
election of Trustees, votes may be cast in favor, against or withheld. Votes
that are withheld will affect the outcome of the election of Trustees because
the election of Trustees requires an affirmative vote of a majority of the
shares or votes present at the shareholder meeting. All Portfolios will vote
together as a single group on the election of Trustees.
PROPOSAL TWO
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
INFORMATION CONCERNING THE FUND'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Fund's Board of Trustees, including a majority of the Trustees who are not
interested persons of MEMBERS Capital Advisors or the Fund, has appointed
Deloitte & Touche LLP as the Fund's independent registered public accounting
firm for the fiscal year ending December 31, 2005. The Board recommends that
Beneficial Owners vote in favor of ratifying this appointment.
Deloitte & Touche LLP examines the annual financial statements of the Fund and
provides certain other audit-related and tax-related services to the Fund.
Representatives of Deloitte & Touche LLP are not expected to be present at the
meeting; however, they will be available by telephone to respond to appropriate
questions if requested. Deloitte & Touche LLP are serving as the Fund's
independent registered public accounting firm for the fiscal year ended December
31, 2004.
PricewaterhouseCoopers LLP served as the Fund's independent registered public
accounting firm for the fiscal year ended December 31, 2003.
PricewaterhouseCoopers LLP examined the annual financial statements of the Fund
for that fiscal year and provided certain other audit-related and tax-related
services to the Fund. Representatives of PricewaterhouseCoopers LLP are not
expected to be present at the meeting.
During the Fund's two most recent fiscal years prior to January 1, 2004 (and in
any subsequent period prior to the appointment of Deloitte & Touche LLP), the
Fund did not consult Deloitte & Touche LLP regarding the application of
accounting principles to a specified transaction or the type of audit opinion
that might be rendered on the Fund's financial statements or regarding any
matter that was the subject of a disagreement or reportable event with respect
to the Fund's former accountants.
FEES PAID TO DELOITTE & TOUCHE LLP AND PRICEWATERHOUSECOOPERS LLP
The aggregate fees billed to the Fund by Deloitte & Touche LLP and by
PricewaterhouseCoopers LLP for professional services rendered during the fiscal
years ended December 31, 2004 and December 31, 2003 were as follows:
Audit Fees. Deloitte & Touche LLP billed the Fund $105,000 for the fiscal year
ended December 31, 2004, and PricewaterhouseCoopers LLP billed the Fund $94,055
for the fiscal year ended December 31, 2003, in connection with the audit of the
Fund's annual financial statements and for services that are normally provided
by the independent registered public accounting firm in connection with
statutory and regulatory filings or engagements.
Audit-Related Fees. Deloitte & Touche LLP and PricewaterhouseCoopers LLP did not
bill the Fund any amounts during the last two fiscal years for assurance and
related services reasonably related to the performance of the audit and not
reported under the heading "Audit Fees" above.
Tax Fees. Deloitte & Touche LLP will bill the Fund $2,400 for the fiscal year
ended December 31, 2004, and PricewaterhouseCoopers LLP billed the Fund $6,500
for the fiscal year ended December 31, 2003, for professional services rendered
by the respective firms for tax compliance, tax advice, tax planning and tax
return preparation.
All Other Fees. Deloitte & Touche LLP and PricewaterhouseCoopers LLP did not
bill the Fund for any services other than those set forth above during the last
two fiscal years.
Audit Committee Pre-Approval Policies. The Audit Committee has established
procedures requiring pre-approval of all audit and non-audit services to be
provided by the independent registered public accounting firm. The Audit
Committee's review includes the determination of a process for the approval of
the fees for such services. All of the services described above that were
provided on or after May 6, 2003, the effective date of SEC rules relating to
the pre-approval of non-audit services, were pre-approved in accordance with the
Audit Committee's pre-approval procedures.
For the fiscal years ended December 31, 2004 and December 31, 2003, there were
no non-audit fees billed by Deloitte & Touche LLP and PricewaterhouseCoopers
LLP, respectively, for services rendered to the Fund, MEMBERS Capital Advisors,
and any entity controlling, controlled by or under common control with MEMBERS
Capital Advisors that provides ongoing services to the Fund.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD RECOMMENDS THAT BENEFICIAL OWNERS VOTE FOR RATIFICATION OF DELOITTE &
TOUCHE LLP AS THE FUND'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE
FISCAL YEAR ENDING DECEMBER 31, 2005.
In order to ratify Deloitte & Touche LLP as the Fund's independent registered
public accounting firm, at least a majority of the votes represented at the
meeting and entitled to vote (with each shareholder receiving one vote for each
dollar of net asset value held by the shareholder in the Fund) must be cast in
favor of ratification, provided that a quorum is present. All Portfolios will
vote together as a single group on the ratification of Deloitte & Touche LLP.
8
PROPOSAL THREE
AMENDMENT TO DECLARATION OF TRUST, SECTION 9.2
VOTE REQUIRED TO ELECT TRUSTEES
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, an amendment to
Section 9.2 of the Fund's Amended and Restated Declaration of Trust (the
"Declaration of Trust") that would remove an existing ambiguity in the
Declaration of Trust and clarify that Trustees will be elected based upon a vote
in which each shareholder will receive one vote for each dollar of net asset
value held by that shareholder in the Fund.
Section 6.2(d) of the Declaration of Trust provides: "On any matter submitted to
a vote of the Shareholders, each holder of a Share shall be entitled to one vote
for each dollar of net asset value standing in his or her name . . ."
However, in apparent contradiction of Section 6.2(d), the second sentence of
Section 9.2 of the Declaration of Trust presently provides: "Election of
Trustees shall be by the affirmative vote of the holders of at least a majority
of the Shares entitled to vote present in person or by proxy at such meeting."
Thus, Section 6.2(d) provides for "dollar voting" on "any matter," but Section
9.2 provides for voting by shares rather than by dollars in the election of
Trustees. This creates an ambiguity with respect to how to count votes in the
election of Trustees - by shares or by dollars.
In order to resolve this ambiguity in favor of a uniform policy of shareholder
voting on the basis of dollars of net asset value, the Board of Trustees has
unanimously approved, and recommends that Beneficial Owners approve, an
amendment to the second sentence of Section 9.2 of the Declaration of Trust so
that it reads as follows:
Election of Trustees shall be by the affirmative vote of the holders of at
least a majority of the votes which are represented in person or by proxy
at such meeting, with the number of votes computed as provided in Section
6.2(d).
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED AMENDMENT TO SECTION 9.2 OF THE DECLARATION OF TRUST.
In order to be approved, pursuant to Section 13.1 of the Declaration of Trust
the amendment must be approved at a meeting of shareholders "by the affirmative
vote of the holders of a majority of the Shares then outstanding and entitled to
vote." Because Section 13.1, like Section 9.2 and in contrast to Section 6.2(d),
calls for a vote by shares, there is ambiguity with respect to whether approval
of this proposed amendment should be based upon a vote of the shares held by
shareholders or based upon the allowance of one vote for each dollar of net
asset value of the Fund held by each shareholder. In other words, it is not
clear whether the voting rule for amendments to the Declaration of Trust is one
share/one vote or one dollar/one vote.
Due to this ambiguity, shareholder approval of this proposed amendment will be
determined by both methods. This means that the proposed amendment will be
approved if (and only if) a majority of shares outstanding and entitled to vote
are cast in favor of the amendment and if a majority of the votes (based upon
one vote for each dollar of net asset value) outstanding and entitled to vote
also are cast in favor of the amendment. In the voting on this proposed
amendment, votes may be cast in favor, against or withheld. Votes that are
withheld will affect the outcome of the approval of this proposed amendment
because approval of amendments to the Declaration of Trust requires an
affirmative vote of a majority of the shares or votes outstanding and entitled
to vote at the shareholder meeting. All Portfolios will vote together as a
single group on this proposed amendment.
PROPOSAL FOUR
AMENDMENT TO DECLARATION OF TRUST, SECTION 13.1
VOTE REQUIRED TO AMEND DECLARATION OF TRUST
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, an amendment to
Section 13.1 of the Declaration of Trust that would remove an existing ambiguity
in the Declaration of Trust and clarify that amendments to the Declaration of
Trust will be approved by shareholders based upon a vote in which each
shareholder will receive one vote for each dollar of net asset value held by
that shareholder in the trust.
Section 6.2(d) of the Declaration of Trust provides: "On any matter submitted to
a vote of the Shareholders, each holder of a Share shall be entitled to one vote
for each dollar of net asset value standing in his or her name . . ."
Section 13.1 of the Declaration of Trust in turn provides, in relevant part:
The provisions of this Declaration of Trust may be amended or altered
(except as to the limitations on personal liability of the Shareholders
and Trustees and the prohibition of assessments upon Shareholders), or the
Trust may be terminated, at any meeting of Shareholders called for the
purpose, by the affirmative vote of the holders of a majority of the
Shares then outstanding and entitled to vote, or by an instrument or
instruments in writing, without a meeting, signed by a majority of the
Trustees and the holders of a majority of such Shares . . . .
Notwithstanding the foregoing, (i) no amendment may be made pursuant to
this Section 13.1 which would change any rights with respect to any
outstanding Shares of the Trust by reducing the amount payable thereon
upon liquidation of the Trust or by diminishing or
9
eliminating any voting rights pertaining thereto, except with the vote or
written consent of the holders of two-thirds (2/3) of the outstanding
Shares entitled to vote thereon; and (ii) no amendment may be made with
respect to the investment restrictions contained in Section 4.2 hereof
without the affirmative vote of the holders of a majority (as defined in
the 1940 Act) of the Shares of the Class of stock affected by such change.
. . .
Because Section 6.2(d) provides for voting by dollars of net asset value in all
cases rather than by shares, Section 13.1 - which repeatedly refers to a vote of
shares - gives rise to ambiguity as to how to count votes on a proposed
amendment to the Declaration of Trust.
To resolve this ambiguity in favor of a uniform policy of shareholder voting on
the basis of dollars of net asset value, as set forth in Section 6.2(d), the
Board of Trustees has unanimously approved, and recommended that Beneficial
Owners approve, an amendment to Section 13.1 of the Declaration of Trust so that
the portion quoted above reads as follows:
The provisions of this Declaration of Trust may be amended or altered
(except as to the limitations on personal liability of the Shareholders
and Trustees and the prohibition of assessments upon Shareholders), or the
Trust may be terminated, at any meeting of Shareholders called for the
purpose, by the affirmative vote of the holders of a majority of the votes
which are entitled to be cast at such meeting, or by an instrument or
instruments in writing, without a meeting, signed by a majority of the
Trustees and the holders of a majority of the votes then entitled to be
cast . . . . Notwithstanding the foregoing, (i) no amendment may be made
pursuant to this Section 13.1 which would change any rights with respect
to any outstanding Shares of the Trust by reducing the amount payable
thereon upon liquidation of the Trust or by diminishing or eliminating any
voting rights pertaining thereto, except with the vote or written consent
of the holders of two-thirds (2/3) of the votes then entitled to be cast
thereon; and (ii) no amendment may be made with respect to the investment
restrictions contained in Section 4.2 hereof without the affirmative vote
of the holders of a majority (as defined in the 1940 Act) of the votes of
the Class of stock affected by such change. For purposes of this Section
13.1, the number of votes entitled to be cast on any proposed amendment or
termination of the Declaration of Trust shall be determined in accordance
with the provisions of Section 6.2(d) of this Declaration.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED AMENDMENT TO SECTION 13.1 OF THE DECLARATION OF TRUST.
In order to be approved, pursuant to the existing Section 13.1 of the
Declaration of Trust the proposed amendment must be approved at a meeting of
shareholders "by the affirmative vote of the holders of a majority of the Shares
then outstanding and entitled to vote." As discussed above, there is ambiguity
with respect to whether approval of this proposed amendment should be based upon
a vote of the shares held by shareholders or based upon the allowance of one
vote for each dollar of net asset value of the Trust held by each shareholder.
In other words, it is not clear whether the voting rule is one share/one vote or
one dollar/one vote.
Due to this ambiguity, shareholder approval of this proposed amendment will be
determined by both methods. This means that the proposed amendment will be
approved if (and only if) a majority of shares outstanding and entitled to vote
are cast in favor of the amendment and if a majority of the votes (based upon
one vote for each dollar of net asset value) outstanding and entitled to vote
also are cast in favor of the amendment. In voting on this proposed amendment,
votes may be cast in favor, against or withheld. Votes that are withheld will
affect the outcome of the approval of this proposed amendment because approval
of amendments to the Declaration of Trust requires an affirmative vote of a
majority of the shares or votes outstanding and entitled to vote at the
shareholder meeting. All Portfolios will vote together as a single group on this
proposed amendment.
PROPOSAL FIVE
AMENDMENT TO DECLARATION OF TRUST, SECTION 4.4
VOTE REQUIRED BY DECLARATION OF TRUST TO CHANGE INVESTMENT POLICIES AND
LIMITATIONS
Under the Investment Company Act of 1940 (the "1940 Act"), a mutual fund must
establish investment policies with respect to certain topics, which policies are
deemed to be "fundamental." A "fundamental" policy cannot be changed without the
approval of the fund's shareholders. In addition, a mutual fund may establish
other investment policies and limitations, and it may designate these as being
either "fundamental" or "non-fundamental." Non-fundamental policies or
limitations may be changed by the Board of Trustees without shareholder
approval. A fund's fundamental and non-fundamental investment policies and
limitations must be described, and designated as such, in the registration
statements which it files with the SEC.
Under Section 4.4 of USF's Declaration of Trust, it is not entirely clear
whether investment policies and limitations which have been designated as
"non-fundamental" in USF's registration statement can be changed by the Board of
Trustees without shareholder approval, even though this is permitted by the 1940
Act. This section provides:
The Investment Objectives and Policies and the Investment Limitations are
deemed to be fundamental policies and may not be changed without the
approval of the holders of a majority of the outstanding voting Shares of
each Portfolio affected which, for purpose herein [sic], shall mean the
lesser of (i) 67% of the Shares represented at a meeting which [sic] more
than 50% of the outstanding Shares are represented or (ii) more than 50%
of the outstanding Shares. A change in policy affecting only one Portfolio
may be effected only with the approval of a majority of the outstanding
Shares of such portfolio.
The Declaration of Trust does not define the terms "Investment Policies" or
"Investment Limitations," and therefore does not explicitly limit these terms to
those investment policies and limitations which the 1940 Act requires to be
fundamental or which have been designated as fundamental in USF's registration
statement.
10
As discussed later in this proxy statement, USF's Board of Trustees is proposing
that some of the investment policies which are now designated as "fundamental"
in USF's registration statement be changed to "non-fundamental" policies, so
that the Board of Trustees has the flexibility to change them in the future
without a shareholder vote. However, unless Section 4.4 is removed from USF's
Declaration of Trust at the same time, a question would remain as to whether a
shareholder vote still would be required in order to change such non-fundamental
policies, even though such a vote would not be required by the 1940 Act itself.
For this reason, at its December 28, 2004 meeting, the Board of Trustees
approved, and recommended that Beneficial Owners approve, an amendment to USF's
Declaration of Trust which would remove Section 4.4 altogether. If Beneficial
Owners approve this amendment, they still will be entitled to vote on changes to
USF's fundamental investment policies and limitations to the full extent
required by the 1940 Act. In addition, since all of the Portfolios' investment
objectives are designated as fundamental in USF's registration statement,
Beneficial Owners also will remain entitled to vote on any proposed changes to
such investment objectives.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED AMENDMENT TO THE DECLARATION OF TRUST, ELIMINATING
SECTION 4.4.
In order to be approved, pursuant to the existing Section 13.1 of the
Declaration of Trust, the proposed amendment must be approved at a meeting of
shareholders "by the affirmative vote of the holders of a majority of the Shares
then outstanding and entitled to vote." As discussed above, there is ambiguity
with respect to whether approval of this proposed amendment should be based upon
a vote of the shares held by shareholders or based upon the allowance of one
vote for each dollar of net asset value of the Trust held by each shareholder.
In other words, it is not clear whether the voting rule for amendments to the
Declaration of Trust is one share/one vote or one dollar/one vote.
Due to this ambiguity, shareholder approval of this proposed amendment will be
determined by both methods. This means that the proposed amendment will be
approved if (and only if) a majority of shares outstanding and entitled to vote
are cast in favor of the amendment and if a majority of the votes (based upon
one vote for each dollar of net asset value) outstanding and entitled to vote
also are cast in favor of the amendment. In voting on this proposed amendment,
votes may be cast in favor, against or withheld. Votes that are withheld will
affect the outcome of the approval of this proposed amendment because approval
of amendments to the Declaration of Trust requires an affirmative vote of a
majority of the shares or votes outstanding and entitled to vote at the
shareholder meeting. All Portfolios will vote together as a single group on this
proposed amendment.
PROPOSAL SIX
AMENDMENT TO FUNDAMENTAL INVESTMENT LIMITATION #4
TRADING IN "COMMODITIES"
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, a change to the fourth
Fundamental Limitation listed in USF's registration statement. Currently, this
fourth Fundamental Limitation provides that no Portfolio may:
Purchase or sell commodities, commodity contracts (except financial
futures contracts), foreign exchange or real estate, including interests
in real estate investment trusts whose securities are not readily
marketable or invest in oil, gas or other mineral development or
exploration programs. (This does not prohibit investment in the securities
of corporations which own interests in commodities, foreign exchange, real
estate or oil, gas or other mineral development or exploration programs.)
The HIGH INCOME, MID-CAP STOCK, MULTI-CAP GROWTH STOCK, GLOBAL SECURITIES
and INTERNATIONAL STOCK FUNDS may invest in securities related to oil,
gas, or other mineral development or exploration programs.
The Board of Trustees proposes that this fundamental limitation be amended to
provide that no Portfolio may: "Purchase physical commodities or enter into
contracts requiring the delivery or receipt of physical commodities." The Board
has four reasons for recommending this change.
First, the Board believes that the change will provide the Portfolios with
appropriate flexibility to engage in financial transactions which might be
deemed to involve the purchase or sale of "commodities." The Board noted that
the 1940 Act requires a mutual fund to state as a fundamental investment policy
the extent to which it may engage in the purchase and sale of "commodities."
When the 1940 Act was enacted, the term "commodities" was understood to refer
principally to physical commodities such as agricultural products, precious and
base metals, oil and gas, and the like. In recent years, however, a variety of
new financial contracts and instruments have been created which might be deemed,
for regulatory purposes, to be "commodities."
Thus, one purpose of the proposed change is to provide the Board of Trustees
with the flexibility, without further shareholder vote, to determine what
categories of financial contracts and instruments which might be deemed
"commodities" - but which do not require the delivery or receipt of physical
commodities - are permissible investments for the Portfolios. Although the Board
has no current plans to change the investment policies and restrictions set
forth in the Portfolios' prospectus with respect to these types of financial
contracts and instruments, it believes that it is in the shareholders' best
interest for the Board to have this flexibility without incurring the time and
expense of holding a shareholders meeting each time it believes such a new type
of financial contract or instrument would be an appropriate permissible
investment for a Portfolio.
Second, the Board of Trustees noted that the reference to "real estate" in the
current investment limitation overlaps substantially with the current eighth
Fundamental Limitation, which provides that no fund may: "Purchase or sell real
estate, except a fund may purchase securities which are issued by companies
which invest in real estate or interests therein." The Board noted that the 1940
Act requires a mutual fund to state as a fundamental investment policy the
extent to which it may engage in the purchase and sale of real estate, and that
the current eighth Fundamental
11
Limitation is responsive to this requirement. The Board does not propose to
amend the current eighth Fundamental Limitation in any way, so the Portfolios
will remain subject to its limitation. Accordingly, the only operative effect of
the proposed amendment to the fourth Fundamental Limitation with respect to real
estate will be to eliminate the prohibition on purchasing interests in real
estate investment trusts (or "REITs") which are not readily marketable. As
discussed under Proposal Twelve below, the Portfolios already are subject, and
will remain subject, to limitations imposed by the SEC on the extent to which
they may invest in securities which are not readily marketable, i.e., are deemed
to be "illiquid." Given this, the Board of Trustees does not believe it is
necessary or appropriate to impose a separate outright prohibition on one
specific category of securities which are not readily marketable.
Third, the Board of Trustees noted that the current fourth Fundamental
Limitation bars the Portfolios from purchasing or selling foreign exchange. The
Board noted that mutual funds commonly purchase and sell foreign exchange in
connection with the settlement of transactions which are denominated in a
currency other than U.S. dollars, and may also do so in order to hedge foreign
currency risk associated with owning securities which are traded in foreign
markets. For this reason, and because the 1940 Act does not require a
fundamental limitation with respect to the purchase and sale of foreign
exchange, the Board believes that this fundamental limitation should be
eliminated.
Finally, the Board of Trustees noted that the current fourth Fundamental
Limitation bars the Portfolios from purchasing or selling interests in oil, gas
or other mineral development or exploration programs. Although the Portfolios do
not currently intend to make such investments, the Board does not believe a
fundamental limitation on such investments is necessary or appropriate. In this
regard, the Board noted that the proposed amended limitation would continue to
prevent the Portfolios from investing in any such programs which would require
them to deliver or take receipt of physical commodities.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE TO FUNDAMENTAL LIMITATION #4.
Shareholders will vote on this and the other changes to fundamental investment
policies which are proposed herein on a Portfolio-by-Portfolio basis. Thus, such
a change will not take effect with respect to a particular Portfolio unless the
shareholders of that Portfolio approve it by the required vote.
Under the 1940 Act, a proposed change in a fundamental investment policy must be
approved with respect to a Portfolio by the lesser of: (a) 67% or more of the
voting securities of the Portfolio present at the related shareholders meeting,
if the holders of more than 50% of the outstanding voting securities of the
Portfolio are present or represented by proxy at the meeting, or (b) 50% of the
outstanding voting securities of the Portfolio. The required vote described in
the preceding sentence sometimes is called a "1940 Act Majority." The 1940 Act
provides in effect that where a fund's governing documents provide for "dollar
voting," the percentages required for a 1940 Act Majority are calculated on a
dollar voting basis.
Section 4.4 of USF's Declaration of Trust, which is quoted under Proposal Five
above, mirrors this 1940 Act voting requirement. However, Section 4.4, when read
together with Section 6.2(d) of the Declaration of Trust, does not make it clear
whether voting on amendments to fundamental investment policies is to be
performed on a one share/one vote basis or a one dollar/one vote basis. For this
reason, shareholder approval of this and the other changes to fundamental
investment policies which are proposed herein will be determined by both
methods.
Therefore, the proposed change in fundamental investment policy set forth in
this proposal will not be approved with respect to a Portfolio unless the
shareholders of that Portfolio approve it by a 1940 Act Majority, determined
both on a one share/one vote basis and a one dollar/one vote basis.
PROPOSAL SEVEN
ELIMINATION OF FUNDAMENTAL INVESTMENT LIMITATION #5
ISSUER DIVERSIFICATION
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, the elimination of the
fifth Fundamental Limitation listed in USF's registration statement. Currently,
this fifth Fundamental Limitation provides that no Portfolio may:
Make investments in the securities of any one issuer which, at the time of
acquisition, account for more than five percent (5%) of the value of the
assets of a fund in securities of any one issuer, except in the case of
the securities issued or guaranteed by the U.S. Government, its agencies
or instrumentalities.
The Board of Trustees believes that this Fundamental Limitation is unduly
restrictive, placing greater restrictions on the Portfolios than are imposed
under the 1940 Act. The 1940 Act classifies all mutual funds as either
"diversified" or "non-diversified," and it provides that a fund cannot change
its classification from one to the other without a shareholder vote. Each of the
Portfolios presently is classified as a "diversified" fund. The 1940 Act
provides that a "diversified" fund must satisfy the following diversification
requirement:
At least 75 per centum of the value of its total assets is represented by
cash and cash items (including receivables), Government securities,
securities of other investment companies, and other securities for the
purposes of this calculation limited in respect of any one issuer to an
amount not greater in value than 5 per centum of the value of the total
assets of such management company and to not more than 10 per centum of
the outstanding voting securities of such issuer.
The Board of Trustees recommends that the fifth Fundamental Limitation be
eliminated altogether, so that the Portfolios will be subject only to the 1940
Act diversification requirement quoted above. The principal effect of this
change will be to permit a Portfolio to hold more than five percent of
12
its assets in the securities of one issuer. However, no more than a total of
twenty-five percent of a Portfolio's assets could be invested in such
over-five-percent holdings.
Although the Board of Trustees does not expect such over-five-percent holdings
to be commonplace, it believes that the Portfolios' investment advisor and
sub-advisors should have the flexibility to make such investments if they
believe the investments to be in the shareholders' best interests. The Board
noted that most other "diversified" mutual funds already have this flexibility.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE ELIMINATING FUNDAMENTAL LIMITATION #5.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation # 5 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
PROPOSAL EIGHT
ELIMINATION OF FUNDAMENTAL INVESTMENT LIMITATION #6
INVESTMENTS FOR THE PURPOSE OF EXERCISING CONTROL OR MANAGEMENT
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, the elimination of the
sixth Fundamental Limitation listed in USF's registration statement. Currently,
this sixth Fundamental Limitation provides that no Portfolio may: "Invest in
securities of a company for the purpose of exercising control or management."
The Board of Trustees recommends that the sixth Fundamental Limitation be
eliminated altogether. The Board has noted that the 1940 Act does not require a
mutual fund to have a fundamental investment policy addressing this topic. It
also has noted that certain state securities regulators previously required
funds to adopt such a policy, but no longer do so. Thus, applicable law no
longer requires a fundamental limitation addressing this topic.
The Trustees do not presently expect any of the Portfolios to invest for the
purpose of exercising control over another company. For this reason, the
Trustees have approved a non-fundamental limitation to the same effect as the
current fundamental limitation, which will take effect if shareholders approve
the elimination of the fundamental limitation. The Trustees then could change
this non-fundamental limitation in the future without a shareholder vote if they
deemed this to be in the best interests of shareholders. This might be the case,
for example, if a Portfolio held securities of an issuer which was in a
"workout" situation, and the Portfolio's investment advisor or sub-advisor
wished to participate in structuring the "workout."
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE ELIMINATING FUNDAMENTAL LIMITATION #6.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation #6 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
PROPOSAL NINE
ELIMINATION OF FUNDAMENTAL INVESTMENT LIMITATION #7
INVESTMENTS IN OTHER INVESTMENT COMPANIES
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, the elimination of the
seventh Fundamental Limitation listed in USF's registration statement.
Currently, this seventh Fundamental Limitation provides that no Portfolio may:
Invest in securities issued by any other registered investment companies
in excess of five percent (5%) of total assets, nor in excess of three
percent (3%) of the assets of the acquired investment company. Not more
than ten percent (10%) of total assets taken at market value will be
invested in such securities.
The Board of Trustees proposes and recommends that the seventh Fundamental
Limitation be eliminated altogether. The Board has noted that the 1940 Act does
not require a mutual fund to have a fundamental investment policy addressing
this topic. The Board also has noted that this Fundamental Limitation merely
restates the same restrictions which are imposed by Section 12(d)(1) of the 1940
Act itself. Thus, if this Fundamental Limitation is eliminated, the Portfolios
will remain subject to exactly the same limitation as a matter of law unless
Section 12(d)(1) of the 1940 Act is amended.
13
The Board believes that elimination of this investment restriction as a
fundamental policy would provide additional flexibility to the Portfolios in the
event that Section 12(d)(1) of the 1940 Act ever is amended.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE ELIMINATING FUNDAMENTAL LIMITATION #7.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation #7 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
PROPOSAL TEN
AMENDMENT TO FUNDAMENTAL INVESTMENT LIMITATION #9
ISSUANCE OF SENIOR SECURITIES
At its December 28, 2004 meeting, the Fund's Board of Trustees unanimously
approved, and recommended that Beneficial Owners approve, a change to the ninth
Fundamental Limitation listed in USF's registration statement. Currently, this
ninth Fundamental Limitation provides that no Portfolio may:
Issue senior securities as defined in the Act, except insofar as a fund
may be deemed to have issued a senior security by reason of (a) entering
into any repurchase agreement; (b) borrowing money in accordance with
restrictions described above; (c) lending portfolio securities; (d)
purchasing securities on a when-issued or delayed delivery basis; or (e)
accommodating short sales. If the asset coverage falls below three hundred
percent (300%), when taking into account items (a) through (e), a fund may
be required to liquidate investments to be in compliance with the Act.
The Board of Trustees proposes that this fundamental limitation be amended to
provide that no Portfolio may:
Issue senior securities as defined in the Investment Company Act of 1940,
except as is permitted by such Act, by rules under such Act, and by SEC
positions with respect to the issuance of obligations which might be
deemed senior securities.
Section 18(f) of the 1940 Act places limitations on mutual funds' issuance of
securities and other obligations which are deemed to be "senior securities"
under that Act. Because the 1940 Act's definition of the term "senior security"
is very complicated, from time to time the SEC issues rules and interpretations
concerning what types of securities and other obligations are deemed to be
"senior securities," and the circumstances under which a fund can issue
securities or other obligations which might otherwise be deemed "senior
securities."
The current fundamental limitation attempts to identify specific instances in
which the SEC permits a fund to issue securities or enter into obligations which
might be deemed to be "senior securities" under the 1940 Act. However, because
the SEC issues new rules and interpretations in this area from time to time, the
limitation falls out of date whenever a new interpretation is issued. For this
reason, the Board of Trustees believes that it is in shareholders' best interest
to re-cast the limitation to contemplate future changes in SEC rules and
interpretations which might provide greater flexibility to the Portfolios'
investment managers. Under the limitation as it is proposed to be amended, the
Portfolios could issue securities and other obligations which might be deemed
"senior securities" to the extent permitted by the SEC from time to time,
subject to any conditions the SEC might impose in connection with its rules and
interpretations.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE TO FUNDAMENTAL LIMITATION #9.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation #9 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
PROPOSAL ELEVEN
COMBINATION AND AMENDMENT OF FUNDAMENTAL INVESTMENT LIMITATIONS #10 AND #12
LOANS BY THE PORTFOLIOS
Both the tenth and the twelfth Fundamental Limitations listed in USF's
registration statement address lending by the Portfolios. The twelfth
Fundamental Limitation provides that no Portfolio may:
Make loans (the acquisition of bonds, debentures, notes and other
securities as permitted by the investment objectives of a fund shall not
be deemed to be the making of loans) except that a fund may purchase
securities subject to repurchase agreements under policies established by
the Trustees.
14
The tenth Fundamental Limitation provides that no Portfolio may:
Lend portfolio securities in excess of thirty percent (30%) of the value
of its total assets. Any loans of portfolio securities will be made
according to guidelines established by the Trustees, including maintenance
of collateral of the borrower at least equal at all times to the current
market value of the securities loaned.
The Board of Trustees proposes that these two fundamental limitations be
combined into one and amended to provide that no Portfolio may:
Make loans (the acquisition of bonds, debentures, notes and other
securities as permitted by the investment objectives of a fund shall not
be deemed to be the making of loans) except that a fund may purchase
securities subject to repurchase agreements under policies established by
the Trustees and may make loans of securities as permitted by applicable
law.
The Board of Trustees believes that the two limitations should be combined into
one in order to eliminate the confusion that can result from having two
limitations which address the same general subject, i.e., the making of loans by
the Portfolios. In combining the two limitations, no change is proposed to the
language of the current twelfth Fundamental Limitation. The current tenth
Fundamental Limitation, which specifically addresses the lending of securities
by the Portfolios, would be changed to permit the Portfolios to lend their
securities as permitted by applicable law.
The effect of this proposed change to the current tenth Fundamental Limitation
is as follows: Under current SEC interpretations, a mutual fund can lend
securities equal in value to up to one-third of its total assets, after taking
into account the value of the collateral the fund receives for the loan. If
shareholders approve the proposed change, the Portfolios could lend securities
up to this amount. Under the current fundamental limitation, the Portfolios can
lend securities up to 30% (rather than one-third) of the value of their total
assets. Thus, the change would permit a modest increase in the maximum
proportion of their securities which the Portfolios can lend.
The proposed change also would eliminate the current tenth Fundamental
Limitation's requirement that securities lending be conducted "according to
guidelines established by the Trustees, including maintenance of collateral of
the borrower at least equal at all times to the current market value of the
securities loaned." Current SEC interpretations already require that securities
loans be collateralized at least 100%, and that the securities loaned and the
collateral received be "marked to market" on a daily basis. They also require
that the Board of Trustees exercise reasonable oversight with respect to the
Portfolios' securities lending activities. Thus, in practice, the elimination of
this language in the current tenth Fundamental Limitation will not result in the
elimination of any protections associated with securities lending by the
Portfolios.
The Trustees recognize that when the Portfolios lend their securities, they
undertake credit risk with respect to the borrower of the securities. If the
borrower is not able to return the borrowed securities or post additional
collateral when required, the Portfolios could experience a loss when they
liquidate the collateral which they hold. The Trustees believe that the modest
increase in securities lending which would be permitted under the proposed
elimination of this fundamental limitation will not increase the risk borne by
the Portfolios significantly, given the requirement that collateral be "marked
to market" daily and the other SEC requirements with respect to securities
lending.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED COMBINATION AND AMENDMENT OF FUNDAMENTAL LIMITATION #10
AND #12.
In order to be approved as to a Portfolio, the combination and amendment of
Fundamental Limitation #10 and #12 must be approved by a 1940 Act Majority of
that Portfolio's shareholders. The term "1940 Act Majority" is defined under
Proposal Six above. For the reasons discussed under Proposal Six, this proposal
will not be approved with respect to a Portfolio unless the shareholders of that
Portfolio approve it by a 1940 Act Majority, determined both on a one share/one
vote basis and a one dollar/one vote basis.
PROPOSAL TWELVE
ELIMINATION OF FUNDAMENTAL INVESTMENT LIMITATION #11
INVESTMENTS IN ILLIQUID SECURITIES
The Fund's eleventh Fundamental Limitation listed in USF's registration
statement currently provides that no Portfolio may:
Invest in illiquid assets (which include repurchase agreements that do not
mature within seven (7) days, non-negotiable time deposits maturing in
over seven (7) days, restricted securities, and other securities for which
there is no ready market) in an amount in excess of ten percent (10%) of
the value of its total assets. The HIGH INCOME, MID-CAP STOCK, MULTI-CAP
GROWTH STOCK, GLOBAL SECURITIES and INTERNATIONAL STOCK FUNDS may invest
up to fifteen percent (15%) of the value of the fund's net assets in
illiquid assets.
The Board of Trustees is recommending that this fundamental limitation be
eliminated altogether. Current SEC interpretations provide that a mutual fund,
other than a money market fund, cannot invest more than 15% of its assets in
illiquid assets. A money market fund, such as USF's Money Market Fund, cannot
invest more than 10% of its assets in illiquid assets. Under current SEC
interpretations, certain securities which are "restricted securities" under the
Securities Act of 1933 (the "1933 Act") may nevertheless be deemed "liquid" for
purposes of these limitations if a sufficient trading market exists for them.
Such securities include commercial paper issued under Section 4(2) of the 1933
Act and privately placed securities which can be traded among institutions
pursuant to Rule 144A under the 1933 Act.
15
If the current eleventh Fundamental Limitation is eliminated, the Portfolios
will remain subject to the SEC limitations described in the preceding paragraph.
Thus, the elimination of this fundamental limitation would effectively increase
the percentage of illiquid assets which Bond Fund, Balanced Fund, Growth and
Income Fund, and Capital Appreciation Fund can hold from 10% to 15%, and would
leave the percentage unchanged as to the other Portfolios. In addition, the
elimination of this fundamental limitation would permit all of the Portfolios to
count certain "restricted securities" as being "liquid" for purposes of the
percentage limitations, in accordance with the SEC interpretations referred to
above.
The Board of Trustees believes that these changes are in shareholders' best
interest because they would provide greater portfolio management flexibility to
the Portfolios' investment advisors and sub-advisors. With respect to the
Portfolios whose permitted investments in illiquid securities would effectively
increase from 10% to 15%, the Trustees believe the Portfolios would continue to
hold more than enough liquid securities to meet redemption requests in the
normal course. In addition, because illiquid securities sometimes can be
purchased on more favorable terms than liquid securities, the Trustees believe
these Portfolios could benefit from the change if their investment advisor or
sub-advisor chooses to take advantage of it.
The Trustees recognize that investing in illiquid securities involves some risk.
A Portfolio's investment advisor or sub-advisor may not be able to sell an
illiquid security when it wishes to, or may realize lower sale proceeds when it
ultimately does sell the security. Nevertheless, within the SEC's limitations on
investments in illiquid securities, the Trustees believe the Portfolios'
investment advisors and sub-advisors should have the flexibility to judge
whether these risks are outweighed by the potential benefits to shareholders.
The Trustees also believe that the Portfolios could benefit from the ability to
purchase "restricted securities" without limitation, provided that they are
deemed "liquid" in accordance with SEC interpretations. They have noted in this
regard that a very large market now exists for many Section 4(2) and Rule 144A
securities, and that many such securities trade as freely as non-restricted
securities. The Trustees believe that expanding the Portfolios' investable
universe in this manner will provide additional and appropriate investment
flexibility to their investment advisors and sub-advisors.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE ELIMINATING FUNDAMENTAL LIMITATION #11.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation #11 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
PROPOSAL THIRTEEN
ELIMINATION OF FUNDAMENTAL INVESTMENT LIMITATION #13
INVESTMENTS IN FOREIGN SECURITIES
The Fund's thirteenth Fundamental Limitation listed in USF's registration
statement currently provides that no Portfolio may:
Except as follows, invest in foreign securities (ADRs are not considered
foreign securities) in excess of ten percent (10%) of the value of its
total assets. The HIGH INCOME, MID-CAP STOCK, and MULTI-CAP GROWTH STOCK
FUNDS may invest up to twenty-five percent (25%) of the value of the
fund's total assets in foreign securities. The GLOBAL SECURITIES and
INTERNATIONAL STOCK FUNDS may invest up to 100% of the value of the fund's
total assets in foreign securities.
The Board of Trustees is recommending that this fundamental limitation be
eliminated altogether. If this proposal is approved, the Board of Trustees has
approved a non-fundamental limitation providing that no Portfolio will invest
more than 25% of the value of its total assets in foreign securities, except
that: (1) High Income Fund may invest up to 50% of its total assets in such
securities; and (2) International Stock Fund and Global Securities Fund may
invest up to 100% of their total assets in such securities. This non-fundamental
limitation could be further amended by the Board without a shareholder vote.
Because the 1940 Act does not require a mutual fund to have a fundamental
limitation with respect to investments in foreign securities, the Board of
Trustees believes it is appropriate to change this limitation from fundamental
to non-fundamental. This will enable the Board to change the limitation with
respect to particular Portfolios in the future without incurring the time and
expense associated with holding a shareholders meeting to vote on the change.
If this change is approved, it would have the effect of increasing the
percentage of total assets which Bond Fund, Balanced Fund, Growth and Income
Stock Fund, Capital Appreciation Fund, and Money Market Fund can invest in
foreign securities from 10% to 25%. However, Money Market Fund could only invest
in foreign securities which are denominated in U.S. Dollars and which meet its
stringent credit quality and diversification standards. In addition, this change
would have the effect of increasing the percentage of total assets which High
Income Fund can invest in foreign securities from 25% to 50%. Given the
increased availability of foreign securities, the expanded trading markets for
such securities, and the diversification which foreign securities can provide to
a portfolio, the Board of Trustees believes it is appropriate to provide this
increased flexibility to these Portfolios' investment advisors and sub-advisors.
In addition, with respect to High Income Fund, the change would align the
Portfolio's limitation on investments in foreign securities with the limitation
which applies to a "mirror" fund which is offered directly to the public and
which has the same investment advisor and sub-advisor (i.e., MEMBERS Mutual
Funds High Income Fund).
16
In making these determinations, the Trustees recognized that investing in
foreign securities involves certain risks which are not associated with
investing in domestic securities. These risks include possible fluctuations in
currency exchange rates; higher trading and custody charges than for domestic
securities; different accounting and reporting practices and requirements than
for domestic companies; less stringent securities regulations than those of the
U.S.; and potential political and economic instability. The Trustees believed
that it is appropriate to enable the individual Portfolios' investment advisors
and sub-advisors to determine the extent to which these risks should be
undertaken within the limitations set forth in the proposed new non-fundamental
investment limitation.
BOARD RECOMMENDATION; VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT THE BENEFICIAL OWNERS OF EACH PORTFOLIO
VOTE FOR THIS PROPOSED CHANGE ELIMINATING FUNDAMENTAL LIMITATION #13.
In order to be approved as to a Portfolio, the elimination of Fundamental
Limitation #13 must be approved by a 1940 Act Majority of that Portfolio's
shareholders. The term "1940 Act Majority" is defined under Proposal Six above.
For the reasons discussed under Proposal Six, this proposal will not be approved
with respect to a Portfolio unless the shareholders of that Portfolio approve it
by a 1940 Act Majority, determined both on a one share/one vote basis and a one
dollar/one vote basis.
17
EXHIBIT A
ULTRA SERIES FUND
AUDIT COMMITTEE CHARTER
DECEMBER 2, 2004
1. The Audit Committee of the Board of Trustees of MEMBERS Mutual Funds and
Ultra Series Funds (the "Trusts") shall consist of at least three
directors, including the chairperson, who are not "interested persons" of
the Trusts, as defined in the Investment Company Act of 1940, as amended
(the "1940 Act"), and who are also "independent trustees" of the Trusts,
as such term is defined in Section 301 of the Sarbanes-Oxley Act of 2002.
At least one member of the Audit Committee must be an "audit committee
financial expert" as defined in Form N-CSR, Item 3(b).
2. The purposes of the Audit Committee are:
(a) to oversee the Trusts' accounting and financial reporting
policies and practices, its internal controls and procedures
for financial reporting and, as appropriate, such internal
controls of certain service providers;
(b) to consider the provision of audit and any non-audit services
by the Trust's independent auditors;
(c) to oversee the quality and objectivity of the Trusts'
financial statements and the independent audit thereof;
(d) to act as a liaison between the Trusts' independent auditors
and the full Board of Trustees; and
(e) to act upon reports or other information of deficiencies,
weaknesses of internal controls and procedures for financial
reporting, fraud or other similar matters.
The function of the Audit Committee is oversight; it is management's
responsibility to maintain appropriate systems for accounting and internal
control, and the independent auditors' responsibility to plan and carry
out a proper audit.
3. To carry out its purposes, the Audit Committee shall have the following
duties and powers:
(a) to recommend the selection, retention or termination of the
independent auditors and, in connection therewith, to evaluate
the independence of the auditors, including whether the
auditors provide any consulting services to the adviser, and
to receive the independent auditors' specific representations
as to their independence;
(b) to meet with the Trusts' independent auditors, including
private meetings, as necessary (i) to review the arrangements
for the scope of the annual audit and any special audits; (ii)
to discuss any matters of concern relating to the Trusts'
financial statements, including any adjustments to such
statements recommended by the independent auditors, or other
results of said audit(s); (iii) to consider the independent
auditors' comments with respect to the Trusts' financial
policies, procedures and internal accounting controls and
management's responses thereto; and (iv) to review the form of
opinion the independent auditors propose to render to the
Board of Trustees and shareholders;
(c) to discuss with the independent auditors all critical
accounting policies and practices to be used; all alternate
treatments of financial information with GAAP that have been
discussed with the management, ramifications of the use of
such alternative disclosures and treatments, and the treatment
preferred by the auditing firm; and other material written
communications between the auditing firm and management, such
as any management letter or schedule of unadjusted
differences;
(d) to consider the effect upon the Trusts of any changes in
accounting principles or practices proposed by management or
the independent auditors;
(e) to review and pre-approve the audit and non-audit services to
be provided by the independent auditors, such review to
include the determination of a process for the approval of the
fees for such services;
(f) to establish procedures for the receipt, retention and
treatment of complaints received by the Audit Committee
regarding accounting, internal accounting controls or auditing
matters, and the confidential, anonymous submission by
employees of concerns regarding questionable accounting or
auditing matters;
(g) to investigate any reports of deficiencies in the design or
operation of internal controls and procedures for financial
reporting, material weaknesses in such internal controls, any
fraud involving management or other employees who have a
significant role in the Trusts' internal controls, or other
improprieties or suspected improprieties in Trusts operations;
(h) to receive and act upon any reports from counsel to the Trusts
indicating a "material violation" of securities law or a
breach of fiduciary duty by the Trusts or any agent of the
Trusts;
(i) to report its activities to the full Board of Trustees on a
regular basis and to make such recommendations with respect to
the above and other matters as the Audit Committee may deem
necessary or appropriate; and
(j) To assist the Board of Trustees with the oversight of the
Trusts' internal audit function.
In order to assist the Audit Committee in performing its oversight
function, management will provide drafts of the Trusts' financial
statements to Audit Committee members before the financial
statements are filed with the SEC or published. Audit Committee
members will have the opportunity to make inquiries of management
concerning such drafts and, if they deem it necessary or
appropriate, to convene a meeting of the Audit committee to consider
such drafts.
4. The Audit Committee shall meet as often as it determines is appropriate to
carry out is responsibilities under this charter, but not less frequently
than quarterly and is empowered to hold special meetings as circumstances
require.
5. The Audit Committee, in its discretion, shall meet separately periodically
with management, with the Treasurer of the Trusts or with internal
auditors or other personnel responsible for the internal audit function
and with the independent auditor for the Trusts.
6. The Audit Committee shall have the resources and authority appropriate to
discharge its responsibilities, including the authority to retain special
counsel and other experts or consultants, and pay the independent
auditors, special counsel, and other experts or consultants, out of the
assets of the Trusts, as determined under the Trusts' Management
Agreement.
18
7. The Audit Committee shall have authority to set policies relating to the
hiring by the Trusts of the independent auditors.
8. The Audit Committee shall evaluate the Trusts' performance at least
annually.
9. The Audit Committee shall review this Charter annually and recommend any
changes to the full Board of Trustees.
19
VOTING INSTRUCTION ULTRA SERIES FUND VOTING INSTRUCTION
SPECIAL MEETING OF SHAREHOLDERS -- MARCH 17, 2005
The undersigned owner of a variable annuity and variable life insurance
contracts and qualified pension and retirement plans of companies of CUNA Mutual
Group who, by virtue of such contracts and plans, beneficially own shares of the
Portfolios listed below, a series of Ultra Series Fund (the "Fund"). These
voting instructions are for a Special Meeting of Shareholders of the Fund to be
held at 5810 Mineral Point Road, Madison, Wisconsin, on March 17, 2005, at 3:00
p.m. Central time.
Please check in the appropriate boxes below, date this form, and sign in exactly
as your name appears below. By signing this form, you acknowledge receipt of the
Notice of Special Meeting of Shareholders and the accompanying proxy statement.
As legal owner of the shares, CUNA Mutual Group will vote the shares in
accordance with these instructions at the Special Meeting of Shareholders or any
adjournment thereof. If any other matter properly comes before the Special
Meeting of Shareholders, CUNA Mutual Group will vote in accordance with its best
judgment.
VOTE VIA THE INTERNET: HTTPS://VOTE.PROXY-DIRECT.COM
VOTE VIA THE TELEPHONE: 1-866-235-4258
999 9999 9999 999
NOTE:. Please date these voting instructions and sign
your name in the exact form as it appears herein and
return it promptly in the enclosed envelope. If you
sign as "Trustee" or "Employer, " please give full
title as such.
________________________________________________________
Signature of Beneficial Owner
________________________________________________________
Signature of Beneficial Owner (other) (if held jointly)
__________________________________________, 2005
Date USF_14878
PORTFOLIO PORTFOLIO PORTFOLIO
- --------- --------- ---------
Money Market Bond High Income
Balanced Growth and Income Stock Capital Appreciation Stock
Mid-Cap Stock Multi-Cap Growth Stock Global Securities
International Stock
VOTING OPTIONS
READ YOUR PROXY STATEMENT AND HAVE IT AT HAND WHEN VOTING.
[COMPUTER LOGO] [PHONE LOGO] [LETTER LOGO]
VOTE ON THE INTERNET VOTE BY PHONE VOTE BY MAIL
LOG ON TO: CALL 1-866-235-4258 VOTE, SIGN AND DATE THIS VOTING
HTTPS://VOTE.PROXY-DIRECT.COM FOLLOW THE RECORDED INSTRUCTION AND RETURN IN THE
FOLLOW THE ON-SCREEN INSTRUCTIONS INSTRUCTIONS POSTAGE-PAID ENVELOPE
AVAILABLE 24 HOURS AVAILABLE 24 HOURS
PLEASE MARK BOXES BELOW IN BLUE OR BLACK INK AS FOLLOWS. EXAMPLE: [X]
To Vote FOR ALL Proposals mark this box. No vote is necessary. [ ]
1. ELECTION OF TRUSTEES:
FOR ALL WITHHOLD ALL FOR ALL EXCEPT
01 Michael S. Daubs 02 Lawrence R. Halverson 03 Rolf F. Bjelland [ ] [ ] [ ]
04 Gwendolyn M. Boeke 05 Richard E. Struthers 06 Steven P. Riege
If you do not wish to vote for a particular nominee, mark the "For All Except" FOR AGAINST ABSTAIN
box and write the nominee's number on the line provided. _________________________ [ ] [ ] [ ]
2. TO RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS INDEPENDENT
ACCOUNTANTS FOR THE FUND.
3. TO APPROVE THE AMENDMENTS TO THE FUND'S DECLARATION OF TRUST LISTED BELOW,
AS DESCRIBED IN THE PROXY STATEMENT.
3.A. REVISE SECTION 9.2 REGARDING VOTE REQUIRED TO ELECT TRUSTEES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
3.B. REVISE SECTION 13.1 REGARDING VOTE REQUIRED TO AMEND THE DECLARATION OF
THE TRUST.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
3.C. ELIMINATE SECTION 4.4 REGARDING VOTE REQUIRED TO CHANGE INVESTMENT
OBJECTIVES, POLICIES AND LIMITATIONS.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4. TO APPROVE THE AMENDMENT OR ELIMINATION OF THE FUNDAMENTAL INVESTMENT
POLICIES LISTED BELOW, AS DESCRIBED IN THE PROXY STATEMENT.
4.A. AMEND FUNDAMENTAL LIMITATION #4 REGARDING TRADING IN "COMMODITIES".
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.B. ELIMINATE FUNDAMENTAL LIMITATION #5 REGARDING ISSUER DIVERSIFICATION.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.C. ELIMINATE FUNDAMENTAL LIMITATION #6 REGARDING INVESTMENTS FOR THE PURPOSE
OF EXERCISING CONTROL OR MANAGEMENT.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.D. ELIMINATE FUNDAMENTAL LIMITATION #7 REGARDING INVESTMENTS IN OTHER
INVESTMENT COMPANIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.E. AMEND FUNDAMENTAL LIMITATION #9 REGARDING ISSUANCE OF SENIOR SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.F. COMBINE AND AMEND FUNDAMENTAL LIMITATION #10 AND #12 REGARDING LOANS BY THE
PORTFOLIO.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.G. ELIMINATE FUNDAMENTAL LIMITATION #11 REGARDING INVESTMENTS IN ILLIQUID
SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]
4.H. ELIMINATE FUNDAMENTAL LIMITATION #13 REGARDING INVESTMENTS IN FOREIGN
SECURITIES.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
Money Market [ ] [ ] [ ] Bond [ ] [ ] [ ] High Income [ ] [ ] [ ]
Balanced [ ] [ ] [ ] Growth and Income Stock [ ] [ ] [ ] Capital Appreciation
Mid-Cap Stock [ ] [ ] [ ] Multi-Cap Growth Stock [ ] [ ] [ ] Stock [ ] [ ] [ ]
International Global Securities [ ] [ ] [ ]
Stock [ ] [ ] [ ]