SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO._______)
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement,
[ ] Confidential, for use of the
Commission only (as permitted by
Rule l4a-6(e)(2)).
[ ] Definitive proxy statement.
[X] Definitive additional materials
[ ] Soliciting material under Rule 14a-12.
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(Name of Registrant as Specified In Its Charter)
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(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:
________________________________________________________________________________
FIELDING QUESTIONS FROM CLIENTS REGARDING THE SCHWAB MARKET MANAGER
PROXY AND THE PROPOSED CHANGES CONTAINED WITHIN
For Internal Use Only, Not For Public Use
OVERVIEW
The purpose of the proxy is to request that shareholders vote the proposal to
convert the Schwab MarketManager Portfolios(R) from the current fund-of-funds
structure to a multi-manager structure. The Fund's Trustees believe that the
proposals are in the best interest of shareholders and recommend a vote in favor
of each proposal. PLEASE SEE THE FAQ'S FOR ADDITIONAL INFORMATION.
A copy of the Plain English Summary of the Proxy Statement is attached for your
reference. The Plain English Summary highlights the proposed changes that
shareholders are being asked to vote on. Additional information regarding the
proposed changes is contained in the Proxy Statement. Shareholders should be
encouraged to review the Proxy Statement and to vote."
Shareholders of the Schwab MarketManager Portfolios, as of the close of business
on February 28, 2002 (the record date), are being sent a proxy on or about March
29, 2002 and may have questions regarding its purpose and/or their required
tasks.
Shareholders who have specific questions regarding the proxy should contact D.F.
King & Co. at 1-800-628-8528. D.F. King is the Funds' proxy solicitor and can
assist shareholders with proxy questions as well as accept their votes over the
phone.
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FAQ's
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Q1: WHAT IF CLIENTS ASK QUESTIONS REGARDING HOW THEY SHOULD VOTE?
A1: Schwab representatives or representatives affiliated with Schwab CANNOT
instruct shareholders to vote for or against the proposed changes in the
Proxy Statement. However, they can: (1) Relay information that is spelled
out in the proxy statement. 2.) Help clients navigate the proposals. 3.)
Highlight the importance of voting. As outlined in the proxy, the Funds'
trustees believe that the proposals outlined in the proxy statement are in
the best interest of shareholders and therefore recommend a vote in favor
of each proposal. Shareholders should be directed to PAGE 3 of the Plain
English Summary.
Q2: WHO IS SUGGESTING THESE CHANGES?
A2: The changes were suggested by Charles Schwab Investment Management
("CSIM"), the fund's investment adviser, as a way to enhance the
efficiency and flexibility of the Funds. The Funds' trustees believe that
the proposed changes are in the best interest of shareholders and
therefore recommend a vote in favor of each proposal. Shareholders should
be directed to PAGE 6 of the Plain English Summary for additional
information.
Q3: WHERE CAN A SUMMARY OF PROPOSED CHANGES BE FOUND?
A3: PAGE 4 of the Plain English Summary contains a table outlining the proposed
changes.
Q4: IF APPROVED, WHEN WILL THESE CHANGES BECOME EFFECTIVE?
A4: Subject to approval at the May 28, 2002 shareholder meeting, it is
anticipated that the changes will begin to go into effect on or about June
3, 2002.
Q5: WHAT ARE CURRENT SHAREHOLDERS BEING ASKED TO VOTE ON?
A5: The proposed overall change is to convert from a multi-fund investment
structure to a multi-manager investment structure. The changes are
summarized on PAGE 6 of the Plain English Summary and set out in greater
detail on PAGE 13 of the Proxy Statement. Shareholders should be directed
to these pages for more specific information.
Q6: HOW COULD THESE CHANGES BENEFIT SHAREHOLDERS?
A6: If shareholders approve the changes, there are several potential benefits
that could result: (1) lower expected annual costs to shareholders; (2)
access to a broader range of money managers; (3) more complete information
for shareholders; and (4) a customized investment approach. Under this last
benefit, CSIM would not only be able to choose the sub-advisers and how
much they manage, but also give specific instructions on certain issues.
For additional information regarding these benefits, shareholders should be
directed to PAGE 7 of the Plain English Summary.
Q7: HOW DO SHAREHOLDERS VOTE THEIR SHARES?
A7: The instructions can be found on PAGE 6 of the Plain English Summary and
PAGE 14 of the Proxy Statement.
Q8: BETWEEN NOW AND THE CONVERSION DATE, CAN THESE FUNDS STILL BE PURCHASED BY
CLIENTS?
A8: Yes. However, Clients need to be notified of the pending Proxy Statement
and of the proposed changes. Shares purchased after the record date are not
entitled to vote.
Q9: WHO IS DF KING & CO. ?
A9: The Funds have retained D.F. King & Co. as a proxy solicitor. The Solicitor
has been retained to make follow-up phone calls to shareholders. Clients
who have questions regarding the Proxy Statement may contact D.F. King
directly at 1-800-628-8528. Shareholders should be directed to PAGE 6 of
the Plain English Summary for further information.
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Q10: WHO ARE THE PROPOSED SUB-ADVISERS?
A10: The following screen print identifies the proposed sub-advisers. The screen
is copied from PAGE 34 of the Proxy Statement. Shareholders should be
directed to PAGES 13 AND 34 of the Proxy Statement for additional
information.
[Screen print of Proxy Statement page 34 identifying proposed sub-advisers]
Q11: HOW ARE THE SUB-ADVISERS SELECTED?
A11: CSIM uses a disciplined and rigorous approach when evaluating sub-advisers
for the Funds, considering quantitative as well as qualitative criteria.
This process is encompassed in the "Four P's" (Performance, Philosophy,
People & Process). Shareholders should be directed to PAGE 8 of the Plain
English Summary for further information.
Q12: WILL MULTIPLE MANAGERS COMPLEMENT EACH OTHER?
A12: CSIM believes that they will complement each other. CSIM will have the
ability to coordinate all the sub-advisers for a Fund, managing them
directly so that their investment strategies will complement each other.
Shareholders should be directed to PAGE 7 of the Plain English Summary for
further information.
Q13: HOW DOES THE COST OF THE CURRENT STRUCTURE COMPARE TO THE PROPOSED
STRUCTURE?
A13: The following screen print provides a cost comparison between the current
structure and the proposed structure. The print is copied from PAGE 9 of
the Plain English Summary. Shareholders should be directed to PAGE 9 of
the Plain English Summary and PAGE 20 of the Proxy Statement for
additional information.
[Screen print of Proxy Statement Plain English Summary page 9 showing the cost
comparison between the current structure and the proposed structure.]
Q14: WHAT WILL CSIM'S ROLE BE IN THE PROPOSED STRUCTURE?
A14: CSIM will continue to serve the Funds' investment adviser. CSIM will
manage each Fund using stringent quantitative and qualitative criteria to
select and oversee each sub-adviser. CSIM will also have the option of
managing a Fund's assets directly. Shareholders should be directed to
PAGES 7 AND 8 of the Plain English Summary for further information.
Q15: WILL SHAREHOLDERS REALIZE ANY NET CAPITAL GAIN IF THE CHANGES ARE APPROVED?
A15: As of the date of the proxy statement, the sale of the underlying funds
should not result in a realized net capital gain for shareholders. Market
conditions may change, however, and the conversion could result in a net
realized capital gain that would be distributed to shareholders.
Shareholders should be directed to PAGE 19 of the Proxy Statement for
further information.
Q16: WHAT DO I DO IF I AM CONTACTED BY THE PRESS REGARDING THE PROXY STATEMENT
OR THE PROPOSED CONVERSION?
A16: All press inquiries should be directed to Schwab Corporate Communications
to the attention of Lance Berg at (415) 636-5443 (no client calls).
Q17: WHO CAN I CONTACT IF I HAVE A QUESTION OR ISSUE THAT IS NOT COVERED IN THIS
FAQ?
A17: Product Management/MF Marketing: Steven Greenwell or Keith Goodlett (no
client calls)
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Link: Important Proxy Information about the MarketManager Portfolios
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Page:
PLEASE REVIEW AND VOTE YOUR PROXY
Important changes are being proposed for the MarketManager Portfolios. If you
were a shareholder as of 2/28/02, you should have received a proxy in the mail
which contains important information about the proposed changes as well as
voting instructions. Please make your voice heard and vote today!
If you have questions regarding the proxy, please call our proxy solicitor, D.F.
King and Co. at 1-800-628-8528.
0002-7807