UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Filed by a Party other than the Registrant [ ]
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|_| Preliminary Proxy Statement
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|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss. 240.14a-12
Constellation Institutional Portfolios
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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4) Date Filed:
TOUCHSTONE INVESTMENTS
303 BROADWAY, SUITE 1100
CINCINNATI, OH 45202
Dear Valued Shareholder:
The proxy statement that accompanies this letter describes a proposal to elect
additional members to the Board of Trustees for the Touchstone Funds Group Trust
(the "Trust"), which previously operated under the name "Constellation Funds"
and the Constellation Institutional Portfolios ("CIP"). Enclosed is a Notice,
Proxy Statement and proxy card for a Special Meeting of Shareholders (the
"Special Meeting") of the funds (each, a "Fund" and collectively, the "Funds"),
The Special Meeting is scheduled for February 5, 2007. If you are a shareholder
of record of a Fund as of the close of business on December 7, 2006, you are
entitled to vote at the Special Meeting, and any adjournment of the Special
Meeting, to elect additional members to the Board of Trustees (the "Board") for
the Trusts.
The Board has considered and nominated four additional Trustees (the "Board
Nominees") for election to the Board of the Trusts. Based on information it
received, the Board has determined it to be in the best interests of
shareholders to approve the Board Nominees to serve as trustees. The Board also
recommended that the Proposal be submitted to shareholders for approval.
Your vote is important to us. Please take a few minutes to review this proxy
statement and vote your shares today. We have enclosed one or more proxy cards
that we ask you to complete, sign, date and return as soon as possible, unless
you plan to attend the Special Meeting.
Thank you for your attention and consideration of this important proposal and
for your investment in the Funds. If you need additional information, please
call shareholder services at 1-800-543-0407.
Sincerely,
/s/ Jill T. McGruder
Jill T. McGruder
President
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY CARD IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE, ALONG
WITH INSTRUCTIONS ON HOW TO VOTE OVER THE INTERNET OR BY TELEPHONE SHOULD YOU
PREFER TO VOTE BY ONE OF THOSE METHODS.
TOUCHSTONE VALUE OPPORTUNITIES FUND TOUCHSTONE FAMILY HERITAGE(R) FUND
TOUCHSTONE DIVERSIFIED SMALL CAP VALUE FUND TOUCHSTONE PITCAIRN TAXABLE BOND FUND
TOUCHSTONE CLOVER CORE FIXED INCOME FUND TOUCHSTONE TAX-EXEMPT BOND FUND
TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND TOUCHSTONE SANDS CAPITAL SELECT GROWTH FUND
TOUCHSTONE SHORT DURATION FIXED INCOME FUND TOUCHSTONE SMALL CAP VALUE OPPORTUNITIES FUND
TOUCHSTONE LARGE CAP QUALITY STOCK FUND TOUCHSTONE MID CAP FUND
TOUCHSTONE DIVERSIFIED VALUE FUND TOUCHSTONE HEALTHCARE & BIOTECHNOLOGY FUND
TOUCHSTONE PITCAIRN SELECT VALUE FUND TOUCHSTONE INTERNATIONAL EQUITY FUND
TOUCHSTONE DIVERSIFIED GROWTH FUND TOUCHSTONE STRATEGIC VALUE AND HIGH INCOME FUND
TOUCHSTONE SMALL CAP FUND
EACH, A SERIES OF
TOUCHSTONE FUNDS GROUP TRUST
303 BROADWAY, SUITE 1100
CINCINNATI, OH 45202
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 5, 2007.
NOTICE IS HEREBY GIVEN THAT a Special Meeting of Shareholders (the "Special
Meeting") of the above-referenced funds (each, a "Fund" and collectively, the
"Funds"), each of which is a series of the Touchstone Funds Group Trust (the
"Trust"), will be held at the offices of Touchstone Advisors, Inc.
("Touchstone"), 303 Broadway, Cincinnati, OH 45202, on February 5, 2007 at 10:00
a.m. Eastern time.
At the Special Meeting, shareholders will be asked to:
Elect 4 additional Trustees to the Board of the Touchstone Funds Group
Trust.
All shareholders are invited to attend the Special Meeting. However, if you are
unable to attend the Special Meeting, you are requested to mark, sign and date
the enclosed Proxy Card and return it promptly in the enclosed, postage-paid
envelope so that the Special Meeting may be held and a maximum number of shares
may be voted. In addition, you can vote easily and quickly by Internet, by
telephone or in person. Your vote is important no matter how many shares you
own. You may change your vote even though a proxy has already been returned by
written notice to the Trust, by submitting a subsequent proxy using the mail, by
Internet, by telephone or by voting in person at the Special Meeting.
Shareholders of record at the close of business on December 7, 2006 are entitled
to notice of and to vote at the Special Meeting or any adjournment thereof.
By Order of the Board of Trustees
/s/ Jay S. Fitton
Jay S. Fitton
Secretary
December 15, 2006
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CIP SANDS CAPITAL INSTITUTIONAL GROWTH PORTFOLIO CIP JSAM LARGE CAP VALUE PORTFOLIO
CIP JSAM VALUE PORTFOLIO
EACH, A SERIES OF
CONSTELLATION INSTITUTIONAL PORTFOLIOS
303 BROADWAY, SUITE 1100
CINCINNATI, OH 45202
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 5, 2007.
NOTICE IS HEREBY GIVEN THAT a Special Meeting of Shareholders (the "Special
Meeting") of the above-referenced funds (each, a "Fund" and collectively, the
"Funds"), each of which is a series of the Constellation Institutional
Portfolios ("CIP"), will be held at the offices of Touchstone Advisors, Inc.
("Touchstone"), 303 Broadway, Cincinnati, OH 45202, on February 5, 2007 at 10:00
a.m. Eastern time.
At the Special Meeting, shareholders will be asked to:
Elect 4 additional Trustees to the Board of the Constellation
Institutional Portfolios.
All shareholders are invited to attend the Special Meeting. However, if you are
unable to attend the Special Meeting, you are requested to mark, sign and date
the enclosed Proxy Card and return it promptly in the enclosed, postage-paid
envelope so that the Special Meeting may be held and a maximum number of shares
may be voted. In addition, you can vote easily and quickly by Internet, by
telephone or in person. Your vote is important no matter how many shares you
own. You may change your vote even though a proxy has already been returned by
written notice to the Trust, by submitting a subsequent proxy using the mail, by
Internet, by telephone or by voting in person at the Special Meeting.
Shareholders of record at the close of business on December 7, 2006 are entitled
to notice of and to vote at the Special Meeting or any adjournment thereof.
By Order of the Board of Trustees
/s/ Jay S. Fitton
Jay S. Fitton
Secretary
December 15, 2006
3
TOUCHSTONE FUNDS GROUP TRUST
CONSTELLATION INSTITUTIONAL PORTFOLIOS
303 BROADWAY, SUITE 1100
CINCINNATI, OH 45202
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 5, 2007
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board") of the Touchstone Funds Group Trust and
the Constellation Institutional Portfolios (each a "Trust" and collectively the
"Trusts") for use at a Special Meeting of Shareholders of the above-referenced
funds (each, a "Fund" and collectively, the "Funds"), each of which is a series
of the Trusts, to be held on February 5, 2007 at 10:00 a.m., Eastern time at the
offices of Touchstone Advisors, Inc. ("Touchstone"), 303 Broadway, Suite 1100,
Cincinnati, OH 45202, and at any adjourned session thereof (such Special Meeting
and any adjournment thereof are hereinafter referred to as the "Special
Meeting"). This Proxy Statement is being mailed to shareholders on or about
December 28, 2006. Shareholders of record of the Funds as of the close of
business on December 7, 2006 (the "Record Date") are entitled to vote at the
Special Meeting and will be asked to consider and act on the following proposal:
- --------------------------------------------------------------------------------
DESCRIPTION OF THE PROPOSAL: FUND(S) SOLICITED:
- --------------------------------------------------------------------------------
Elect 4 additional Trustees for the Board of the Trusts All Funds
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- --------------------------------------------------------------------------------
PROPOSAL: ELECTION OF BOARD OF TRUSTEES
- --------------------------------------------------------------------------------
It is proposed that the persons listed below (each, a "Board Nominee" and
collectively, the "Board Nominees") be elected at the Special Meeting to serve
as Trustees of the Trusts. None of the Board Nominees currently serves on the
Board of the Trusts; however, each of the Board Nominees serves on each of the
boards of trustees in the Touchstone mutual fund complex, with the exception of
the Touchstone Funds Group Trust (formerly known as "The Constellation Funds
Group Trust") and Constellation Institutional Portfolios ("CIP"). In addition to
the Touchstone Funds Group Trust and CIP, the Touchtone fund complex consists of
Touchstone Strategic Trust, Touchstone Tax-Free Trust, Touchstone Investment
Trust and Touchstone Variable Series Trust (collectively, the "Touchstone Fund
Complex").
You are being asked to approve the election of the Board Nominees as Trustees of
the Trusts to satisfy certain requirements of Section 16 of the Investment
Company Act of 1940, as amended (the "1940 Act"). Section 16(a) of the 1940 Act
generally requires the trustees of an investment company be elected by
shareholder vote. Section 16(a) provides however, that trustees may be appointed
without the election by shareholders, if, immediately after such appointment, at
least two-thirds of the trustees then holding office have been elected by
shareholders. Currently, all four Trustees have been elected by shareholders. If
the four Board Nominees were appointed to the Board, immediately following such
appointment, only four of eight, or one-half, of the Board could be elected by
shareholder vote, thus failing to meet the two-thirds requirement. Accordingly,
the Board has determined that it would be in the best interests of the Trusts to
call a special meeting at this time and recommend the election by shareholders
of each Board Nominee.
4
The Board Nominees are Richard L. Brenan, H. Jerome Lerner, John P. Zanotti and
John F. Barrett. Mr. Barrett would be considered an "interested person" of the
Trust, as that term is defined in the 1940 Act, because he also serves as
President and Chairman of The Western and Southern Life Insurance Company and
Western-Southern Life Assurance Company, parent companies of Touchstone
Advisors, Inc. and Touchstone Securities, Inc., the investment adviser and
distributor, respectively, of the Trusts. With the exception of Mr. Barrett,
each of the other Board Nominees will be considered an "Independent Trustee" of
the Trusts. Together, the Board Nominees and the current Trustees will comprise
the entire Board of the Trusts. Because the Trusts do not hold regular annual
shareholder meetings, the entire Board will serve until their successors have
been duly elected or appointed, as applicable, or until their earlier
resignation or removal. The names and ages of the Board Nominees, their
principal occupations during the past five years and certain of their other
affiliations are provided below. Each of the Board Nominees has agreed to serve
if elected at the Special Meeting.
It is the intention of the persons designated as proxies, unless otherwise
directed therein, to vote at the Special Meeting for the election of the Board
Nominees named above. If any Board Nominee is unable or unavailable to serve,
the persons named as proxies will vote for such other person(s) as the Board may
recommend.
The Board has overall responsibility to manage and control the business affairs
of the Trusts, including the complete and exclusive authority to oversee and to
establish policies regarding the management, conduct and operation of the
Trusts' business. The Trustees serve on the Board for terms of indefinite
duration. A Trustee's position in that capacity will terminate if he or she is
removed, resigns or is subject to various disabling events such as death or
incapacity. In the event of any vacancy in the position of a Trustee, the
remaining Trustees may appoint an individual to serve as a Trustee, subject to
the provisions of the 1940 Act. A Trustee may be removed by the vote or written
consent of shareholders holding not less than two-thirds of the Trust's
outstanding shares.
The Touchstone Funds Group Trust Board held four regular meetings, and thirteen
special meetings, during the Trust's most recent fiscal year. The Constellation
Institutional Portfolios Trust Board held three regular meetings, and four
special meetings during the Trust's most recent fiscal year. None of the Board
Nominees was in office during the Trusts' most recent fiscal year.
INFORMATION ABOUT THE BOARD NOMINEES. Listed below, for each Board Nominee, are
their names and ages, as well as their proposed positions with the Trusts, their
principal occupations during the past five years, the number of portfolios in
the Touchstone Fund Complex that, if elected, they will oversee and any other
directorships held by the Board Nominees. The business address of each Board
Nominee is Touchstone Advisors, Inc., 303 Broadway, Suite 1100, Cincinnati, OH,
45202.
5
BOARD NOMINEES FOR INDEPENDENT TRUSTEES:
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NUMBER OF
PRINCIPAL FUNDS IN
LENGTH OF OCCUPATION(S) FUND COMPLEX
NAME AND AGE POSITION TIME SERVED DURING PAST 5 YEARS OVERSEEN* OTHER DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------------
Richard L. Brenan Nominee Not Retired Managing 54 Director of Wing
Age: 62 Applicable Partner of KPMG Eyecare Companies;
LLP (a certified Trustee of Touchstone
public accounting Strategic Trust,
firm); Director of The Touchstone Tax-Free
National Underwriter Trust, Touchstone
Company (a Investment Trust and
publisher of Touchstone Variable
insurance and finance Series Trust.
services products)
until 2003.
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H. Jerome Lerner Nominee Not Principal of HJL 54 Trustee of Touchstone
Age: 68 Applicable Enterprises (a Strategic Trust,
privately held Touchstone Tax-Free
investment Trust, Touchstone
company). Investment Trust and
Touchstone Variable
Series Trust.
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John P. Zanotti Nominee Not CEO, Chairman and 54 Director of QMed
Age: 58 Applicable Director of Avaton, (a health care
Inc. (a wireless management
entertainment company); Trustee
company); President of Touchstone
of Cincinnati Strategic Trust,
Biomedical (a life Touchstone Tax-Free
science and economic Trust, Touchstone
development Investment Trust and
company); CEO, Touchstone Variable
Chairman and Series Trust.
Director of Astrum
Digital Information
(an information
monitoring company)
from 2000 until 2001.
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6
BOARD NOMINEE FOR INTERESTED TRUSTEE:
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NUMBER OF
PRINCIPAL FUNDS IN
LENGTH OF OCCUPATION(S) FUND COMPLEX
NAME AND AGE POSITION TIME SERVED DURING PAST 5 YEARS OVERSEEN* OTHER DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------------
John F. Barrett Nominee Not Chairman of the Board, 54 Director of The
Age: 57 Applicable President and Chief Executive Andersons Inc.
Officer of The Western and (an agribusiness
Southern Life Insurance and retailing
Company, Western- Southern company), Convergys
Life Assurance Company Corporation (a
and Western & Southern provider of business
Financial Group, Inc.; Director support systems
and Chairman of Columbus and customer care
Life Insurance Company; operations) and
Fort Washington Investment Fifth Third Bancorp;
Advisors, Inc., Integrity Trustee of Touchstone
Life Insurance Company Strategic Trust,
and National Integrity Life Touchstone Tax-Free
Insurance Company; Director Trust, Touchstone
of Eagle Realty Group, Inc., Investment Trust and
Eagle Realty Investments, Touchstone Variable
Inc.; Integrated Fund Services, Series Trust.
Inc. and IFS Holdings, Inc.;
Director, Chairman and CEO
of WestAd, Inc.; President and
Trustee of Western & Southern
Financial Fund, Inc.
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Mr. Barrett, as President and Chairman of The Western and Southern Life
Insurance Company and Western-Southern Life Assurance Company, parent companies
of Touchstone Advisors, Inc. and Touchstone Securities, Inc., the investment
adviser and distributor of the Funds, and an officer of other affiliates of the
investment adviser and distributor, is an "interested person" of the Trust
within the meaning of Section 2(a)(19) of the 1940 Act.
*The number of funds is based on each of the Touchstone mutual fund complex that
a Board Nominee currently oversees, in addition to each of the Funds and the
separate series of CIP that the Nominee would oversee if elected.
7
CURRENT INDEPENDENT TRUSTEES:
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NUMBER OF
PRINCIPAL FUNDS IN
LENGTH OF OCCUPATION(S) FUND COMPLEX
NAME AND AGE POSITION TIME SERVED DURING PAST 5 YEARS OVERSEEN* OTHER DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------------
Phillip R. Cox Trustee Trustee President and Chief 54 Director of the Federal
Age: 59 since Executive Officer of Cox Reserve Bank of Cleveland
2006 Financial Corp. (a financial and Cinergy Corporation (a
services company). utility company); Chairman
of The Cincinnati Bell
Telephone Company LLC;
Director of the Timken
Company (a manufacturer of
bearings, alloy steels and
related products and
services); Director of
Diebold, Incorporated (a
provider of integrated
self-service delivery and
security systems); Trustee
of Touchstone Funds Group
Trust, Constellation
Institutional Portfolios,
Touchstone Strategic
Trust, Touchstone Tax-Free
Trust, Touchstone
Investment Trust and
Touchstone Variable Series
Trust.
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Donald C. Siekmann Trustee Trustee Executive for Duro Bag 54 Trustee of Jewish
Age: 68 since Manufacturing Co. (a bag Hospital; Greater
2006 manufacturer); President Cincinnati Arts &
of Shor Foundation for Education Center and
Epilepsy Research (a Cincinnati Arts
charitable foundation); Association; Trustee of
Trustee of Riverfront Funds Touchstone Funds Group
(mutual funds) from 1999- Trust, Constellation
2004. Institutional Portfolios,
Touchstone Strategic
Trust, Touchstone Tax-Free
Trust, Touchstone
Investment Trust and
Touchstone Variable Series
Trust.
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Robert E. Stautberg Trustee Trustee Retired Partner of KPMG 54 Trustee of Tri-Health
Age: 72 since LLP (a certified public Physician Enterprise
2006 accounting firm); Vice Corporation; Trustee of
President of St. Xavier High Touchstone Funds Group
School. Trust, Constellation
Institutional Portfolios,
Touchstone Strategic
Trust, Touchstone
Tax-Free Trust, Touchstone
Investment Trust and
Touchstone Variable
Series Trust.
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8
CURRENT INTERESTED TRUSTEE:
- ------------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
PRINCIPAL FUNDS IN
LENGTH OF OCCUPATION(S) FUND COMPLEX
NAME AND AGE POSITION TIME SERVED DURING PAST 5 YEARS OVERSEEN* OTHER DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------------
Jill T. McGruder(2) Trustee Trustee Senior Vice President of The 54 Director of LaRosa's (a
Age: 51 and since 2006 Western and Southern Life restaurant chain); Trustee
President Insurance Company; President of Touchstone Funds
and a director of IFS Financial Group Trust, Constellation
Services, Inc. (a holding Institutional Portfolios,
company); a director and Touchstone Strategic
Capital Analysts Incorporated Trust, Touchstone Tax-
(an investment advisor and Free Trust, Touchstone
broker-dealer), Integrated Investment Trust and
Investment Services, Inc. (the Touchstone Variable Series
Trust's sub-administrator), Trust.
IFS Fund Distributors, Inc.
(a broker-dealer), Touchstone
Advisors, Inc. (the Trust's
investment advisor) and
Touchstone Securities, Inc. (the
Trust's distributor); President
and a director of IFS Agency
Services Inc. (an insurance
agency), W&S Financial Group
Distributors, Inc. (an annuity
distributor) and IFS Systems,
Inc.; Senior Vice President and
a director of Fort Washington
Brokerage Services, Inc. (a
broker-dealer); President
and Chief Executive Officer
of Integrity Life Insurance
Company and National Integrity
Life Insurance Company;
President of Touchstone
Tax-Free Trust, Touchstone
Investment Trust, Touchstone
Variable Series Trust,
Touchstone Strategic Trust
and Constellation Institutional
Portfolios; President of
Touchstone Advisors, Inc. and
Touchstone Securities, Inc. until
2004.
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(2)Ms. McGruder, as a director of Touchstone Advisors, Inc., the Trust's
investment advisor, and Touchstone Securities, Inc., the Trust's distributor and
an officer of affiliates of the Advisor and Distributor, is an "interested
person" of the Trust within the meaning of Section 2(a)(19) of the1940 Act.
9
PRINCIPAL OFFICERS:
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NUMBER OF
PRINCIPAL FUNDS IN
LENGTH OF OCCUPATION(S) FUND COMPLEX
NAME AND AGE POSITION TIME SERVED DURING PAST 5 YEARS OVERSEEN* OTHER DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------------
Jill T. McGruder Trustee and President See biography above. 54 See biography
Age: 51 President since 2006 above.
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Brian E. Hirsch Vice Vice Vice President-Compliance of IFS 54 None.
Age: 50 President President Financial Services Inc.; Director
and Chief since 2006 of Compliance of Fort Washington
Compliance Brokerage Services, Inc.; Chief
Officer Compliance Officer of Puglisi &
Co. from 2001 until 2002; Vice
President - Compliance of
Palisade Capital
Management LLC (an
investment advisor) from
1997 until 2000.
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James H. Grifo Vice Vice President of Touchstone 54 None.
Age: 55 President President Securities, Inc. and Touchstone
since 2006 Advisors, Inc.; Managing Director
of Deutsche Asset Management
until 2001.
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William A. Dent Vice Vice Senior Vice President of 54 None.
Age: 43 President President Touchstone Advisors, Inc.;
since 2006 Marketing Director of Promontory
Interfinancial Network from
2002-2003; Senior Vice President
of McDonald Investments from
1998-2001.
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Terrie A. Controller Controller Senior Vice President, Chief 54 None.
Wiedenheft and and Financial Officer and Treasurer
Age: 44 Treasurer Treasurer of Integrated Investment Services,
since 2006 Inc., IFS Fund Distributors, Inc.
and Fort Washington Brokerage
Services, Inc.; Chief Financial
Officer of IFS Financial Services,
Inc., Touchstone Advisors, Inc.
and Touchstone Securities, Inc.;
Assistant Treasurer of Fort
Washington Investment
Advisors, Inc.
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Jay S. Fitton Secretary Secretary Senior Counsel at Integrated 54 None.
Age: 36 since 2006 Investment Services, Inc.
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FUND SHARES OWNED BY BOARD NOMINEES. As of the date of this Proxy Statement,
none of the Board Nominees serves on the Board or is a beneficial owner of
shares of the Funds. Beneficial ownership is determined in accordance with Rule
16a-1(a)(2) under the Securities Exchange Act of 1934 (the "Exchange Act").
10
BOARD COMPENSATION. The aggregate compensation paid by the Trust and the
Touchstone Fund Complex to the Trustees and Board Nominees serving during the
fiscal year ended September 30, 2006, is set forth in the table below.
Interested Trustees and Trust officers receive no compensation from the Trust
for services to the Trust. Amounts reflected in the table reflect the period
from March 1, 2006 through September 30, 2006, the portion of the most recent
fiscal year during which each Trustee served in such capacity.
COMPENSATION TABLE:
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PENSION OR TOTAL COMPENSATION
AGGREGATE RETIREMENT BENEFITS ESTIMATED ANNUAL FROM THE TRUST AND
COMPENSATION FROM ACCRUED AS PART OF BENEFITS UPON THE TOUCHSTONE
NAME (POSITION) THE TRUST FUND EXPENSES RETIREMENT FUND COMPLEX*
- ------------------------------------------------------------------------------------------------------------------------------------
Jill T. McGruder
(Trustee/President) None None None None
- ------------------------------------------------------------------------------------------------------------------------------------
Phillip R. Cox
(Trustee) $34,750.00 None None $60,250.00
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Donald C. Siekmann
(Trustee) $35,250.00 None None $57,750.00
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Robert E. Stautberg
(Trustee) $37,500.00 None None $65,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
John F. Barrett
(Trustee) None None None None
- ------------------------------------------------------------------------------------------------------------------------------------
Richard L. Brenan
(Trustee) None None None $24,500.00
- ------------------------------------------------------------------------------------------------------------------------------------
H. Jerome Lerner
(Trustee) None None None $28,500.00
- ------------------------------------------------------------------------------------------------------------------------------------
John P. Zanotti
(Trustee) None None None $22,500.00
- ------------------------------------------------------------------------------------------------------------------------------------
* Represents the aggregate total compensation paid, for the 2005 calendar year,
from the combined Constellation and Touchstone fund complex.
AUDIT COMMITTEE. The Board has a standing Audit Committee that is currently
composed of each of the Independent Trustees of the Trust. Robert E. Stautberg
currently serves as chairman of the Audit Committee and Donald C. Siekmann and
Phillip R. Cox currently serve as members of the Audit Committee. The Audit
Committee operates under a written charter approved by the Board. The Audit
Committee is responsible for the selection of the Trust's independent auditors,
including evaluating their independence and meeting with such auditors to
consider and review matters relating to the Trusts' financial reports and
internal accounting.
NOMINATING COMMITTEE. The Nominating Committee is currently comprised of Donald
C. Siekmann, Chairman; Robert E. Stautberg and Phillip R. Cox, each of whom is
an Independent Trustee. The Nominating Committee recommends nominees for (i)
Independent Trustees for consideration by the incumbent Independent Trustees of
the Trust, and (ii) Interested Trustees for consideration by the full Board of
the Trust. During the Trust's fiscal year ended September 30, 2006, the
Nominating Committee met on August 5, 2006 to consider the subject of this
Proposal. The Nominating Committee, which at the time was composed of the
Trust's former trustees, also met on November 9, 2005 to consider a proposal
with respect to the election of the current Trustees. The Board has adopted a
formal charter for its Nominating Committee setting forth such Committee's
responsibilities.
11
The Nominating Committee will consider shareholder recommendations for
nomination to the Board only in the event that there is a vacancy on the Board.
Shareholders who wish to submit recommendations for nominations to the Board to
fill the vacancy must submit their recommendations in writing to Donald C.
Siekmann, Chairman of the Nominating Committee, c/o Touchstone, 303 Broadway,
Suite 1100 Cincinnati, OH 45202. Shareholders should include appropriate
information on the background and qualifications of any person recommended to
the Nominating Committee (e.g., a resume), as well as the candidate's contact
information and a written consent from the candidate to serve if nominated and
elected. Shareholder recommendations for nominations to the Board will be
accepted on an ongoing basis and such recommendations will be kept on file for
consideration in the event of a future vacancy on the Board.
The Nominating Committee generally identifies candidates for Board membership
through personal and business contacts of Trustees and shareholders. In
addition, the Nominating Committee may use a search firm to identify candidates
for Board, if deemed necessary and appropriate to use such a firm.
The Nominating Committee's process for evaluating a candidate generally includes
a review of the candidate's background and experience, a check of the
candidate's references and other due diligence and, when appropriate, interviews
with Nominating Committee members. In evaluating a candidate, the Nominating
Committee will also consider whether the candidate, if elected, would be an
Independent Trustee. The Nominating Committee has not established any specific
minimum requirements that candidates must meet in order to be recommended by the
Nominating Committee for nomination for election to the Board. Rather, the
Nominating Committee seeks candidates who, in its judgment, will serve the best
interests of the Trusts' long-term shareholders and whose background will
complement the experience, skills and diversity of the other Trustees and add to
the overall effectiveness of the Board.
COMMUNICATIONS WITH THE BOARD. Shareholders wishing to submit written
communications to the Board should send their communications to Board of
Trustees, Touchstone Funds, 303 Broadway, Suite 1100, Cincinnati, OH 45202. Any
such communications received will be reviewed by the Board at its next regularly
scheduled meeting.
BOARD RECOMMENDATION ON THE PROPOSAL. In considering whether to nominate the
Board Nominees, the Nominating Committee considered a number of factors,
including but not limited to the fact that the Board Nominees currently serve on
the board of trustees for the Touchstone Fund Complex, with the exception of the
Trust and CIP, and have distinguished careers in accounting, finance, marketing
and other areas and have during their current tenure as trustees for the
Touchstone Fund Complex brought, and expect to continue to bring, a wide range
of expertise to the Board and the oversight of the Trusts. The Nominating
Committee considered, among other factors, the benefits to the Boards and the
Funds that would be derived as a result of nominating Board Nominees who are
familiar with the operations of Touchstone and are exposed to the wide variety
of issues that arise from overseeing the Funds on a day-to-day basis would bring
to the Boards. The Boards met on August 5, 2006 to consider the recommendation
of the Nominating Committee and voted unanimously to approve the nomination of
the Board Nominees to serve as Trustees, subject to approval by shareholders.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT SHAREHOLDERS VOTE "FOR" EACH OF THE
PROPOSED TRUSTEES SET FORTH IN THE PROPOSAL.
12
- --------------------------------------------------------------------------------
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------
On May 17, 2006, the independent registered public accounting firm Ernst & Young
LLP ("E&Y") was selected as the independent auditors for the Trusts for their
current fiscal year. The former audit firm, KPMG LLP, resigned as of May 17,
2006 upon the Audit Committee's decision to retain E&Y as the Trust's auditor.
KPMG LLP's report on the financial statements for the Touchstone Funds Group
Trust's fiscal year ended September 2005 and the fiscal period from October 1,
2005 through May 17, 2006 and the Constellation Institutional Portfolios' fiscal
year ended December 31, 2005 and the fiscal period from January 1, 2006 through
May 17, 2006 did not contain any adverse opinion or a disclaimer of opinion, and
was not qualified or modified as to uncertainty, audit scope, or accounting
principles. During the Touchstone Funds Group Trust's fiscal year ended
September 2005 and the fiscal period from October 1, 2005 through May 17, 2006,
and the Constellation Institutional Portfolios' fiscal year ended December 31,
2005 there were no disagreements with KPMG LLP on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure. KPMG LLP has informed the Trust that it has no material direct or
indirect financial interest in the Trust. Representatives of KPMG LLP are not
expected to be present at the Special Meeting but have been given the
opportunity to make a statement if they so desire and will be available should
any matter arise requiring their presence.
The Audit Committee must approve all audit and non-audit services provided by
E&Y relating to the operations or financial reporting of the Trusts. The Audit
Committee reviews any audit or non-audit services to be provided by E&Y to
determine whether they are appropriate and permissible under applicable law.
The Audit Committee has adopted policies and procedures to provide a framework
for the Audit Committee's consideration of non-audit services by E&Y. These
policies and procedures require that any non-audit service to be provided by E&Y
to the Trusts, Touchstone or any entity controlling, controlled by or under
common control with Touchstone that relate directly to the operations and
financial reporting of the Trusts is subject to pre-approval by the Audit
Committee or the Chairperson of the Audit Committee before such service is
provided.
Representatives of E&Y are not expected to be present at the Special Meeting,
but will have the opportunity to make a statement if they wish, and will be
available should any matter arise requiring their presence.
AUDIT FEES. The aggregate fees billed by KPMG LLP, the principal accountant
prior to May 7, 2006, in connection with the annual audit of the Touchstone
Funds Group Trust's financial statements and for services normally provided by
the independent auditors in connection with statutory and regulatory filings or
engagements for the fiscal year ended September 30, 2005 were $367,500. The
audit fees billed by E&Y, the current principal accountant, for its services
provided to the Touchstone Funds Group Trust for the fiscal year ended September
30, 2006 were $342,000.00.
The aggregate fees billed by KPMG LLP, the principal accountant prior to May 7,
2006, in connection with the annual audit of the Constellation Institutional
Portfolios' financial statements and for services normally provided by the
independent auditors in connection with statutory and regulatory filings or
engagements for the fiscal year ended December 31, 2005 were $60,000.00.
AUDIT-RELATED FEES. There were no fees billed by KPMG LLP, the principal
accountant prior to May 7, 2006 for assurance and other services reasonably
related to the performance of the audit of the Touchstone Funds Group Trust's
financial statements and not reported above under "Audit Fees" for the fiscal
year ended September 30, 2005 and the fiscal period from October 1, 2005 through
May 7, 2006. Similarly, no audit-related fees were billed by E&Y, the current
principal accountant for the fiscal year ended September 30, 2006 The aggregate
fees billed by KPMG LLP for assurance and other services relating to the
performance of the audit of the financial statements of Constellation Investment
Management Company, L.P., the former investment adviser to the Trust ("CIMCO"),
and other service providers under common control with CIMCO that relate directly
to the operations or financial reporting of the Trust for the fiscal years ended
September 30, 2005 was $3,500. These audit-related services relate to the use of
name consents. None of these services were approved by the Audit Committee
pursuant to the de minimis exception from the pre-approval requirement under
Regulation S-X.
13
TAX FEES. The aggregate fees billed by KPMG LLP, the principal accountant prior
to May 7, 2006 for tax compliance, tax advice and tax planning (together,
"Tax-Related Services") provided to the Touchstone Funds Group Trust for the
fiscal year ended September 30, 2005 were $48,000.00. The fees billed by E&Y for
its Tax-Related Services provided to the Trust for the fiscal year ended
September 30, 2006 is $38,000.00. None of these Tax-Related Services were
approved by the Audit Committee pursuant to the de minimis exception from the
pre-approval requirement under Regulation S-X. These Tax-Related Services
included review of income tax returns and annual excise distribution
calculations. There were no fees billed by KPMG LLP for Tax-Related Services
provided to CIMCO and other service providers under common control with CIMCO
that relate directly to the operations or financial reporting of the Trust for
the Trust's last two completed fiscal years ended September 30, 2005 and 2006.
The aggregate fees billed by KPMG LLP, the principal accountant prior to May 7,
2006 for tax compliance, tax advice and tax planning (together, "Tax-Related
Services") provided to the Constellation Institutional Portfolios' for the
fiscal year ended December 3, 2005 were $6,000.00. None of these Tax-Related
Services were approved by the Audit Committee pursuant to the de minimis
exception from the pre-approval requirement under Regulation S-X. These
Tax-Related Services included review of income tax returns and annual excise
distribution calculations. There were no fees billed by KPMG LLP for Tax-Related
Services provided to CIMCO and other service providers under common control with
CIMCO that relate directly to the operations or financial reporting of the Trust
for the Trust's last two completed fiscal years ended September 30, 2005 and
2006.
ALL OTHER FEES. There were no fees billed by KPMG LLP, the principal accountant
prior to May 7, 2006 for products and services provided to the Trust's other
than the services reported in the above paragraphs for the Touchstone Funds
Group Trust's fiscal year ended September 30, 2005 and the fiscal period from
October 1, 2005 through May 17, 2006 or the Constellation Institutional
Portfolios' fiscal year ended December 31, 2005 and the fiscal period from
January 1, 2006 through May 7, 2006. Similarly, no fees were billed by E&Y for
products and services other than the services reported in the above paragraphs
provided to the Touchstone Funds Group Trust for the fiscal year ended September
30, 2006 or the Constellation Institutional Portfolios for the fiscal year ended
December 31, 2005. There were no fees billed for any products and services other
than those set forth above provided by KPMG LLP to CIMCO or Touchstone and any
entity controlling, controlled by, or under common control with CIMCO or
Touchstone that relate directly to the operations or financial reporting of the
Trust for the Trust's fiscal year ended September 30, 2005 and the fiscal period
from October 1, 2005 through May 7, 2006. No fees were billed by E&Y with
respect to non-audit fees for services rendered to Touchstone and any entity
controlling, controlled by, or under common control with Touchstone for the
fiscal year ended September 30, 2006.
AGGREGATE NON-AUDIT FEES TO THE TRUSTS. There were no non-audit fees billed by
KPMG LLP, the principal accountant prior to May 7, 2006 for services rendered to
the Trusts, CIMCO, Touchstone and other service providers under common control
with CIMCO or Touchstone, for the Trust's fiscal year ended September 30, 2005
and the fiscal period from October 1, 2005 through May 7, 2006. In connection
with its selection of the principal accountant, the Audit Committee has
considered KPMG LLP's provision of non-audit services to CIMCO and Touchstone
and other services provided to any entity controlling, controlled by, or under
common control with CIMCO or Touchstone that were not required to be
pre-approved pursuant to Regulation S-X. Similarly, the Audit Committee has
considered E&Y's provision of non-audit services to Touchstone and other
services provided to any entity controlling, controlled by, or under common
control with Touchstone. The Audit Committee has determined that the provisions
of these services are compatible with maintaining the KPMG LLP's and E&Y's
independence.
14
- --------------------------------------------------------------------------------
OTHER INFORMATION
- --------------------------------------------------------------------------------
GENERAL. As used in this proxy statement, the Trusts' Board of Trustees is
referred to as the "Board," and the term "Trustee" includes each trustee of the
Trust. A Trustee that is an interested person of the Trusts is referred to in
this proxy statement as an "Interested Trustee." A Trustee may be an interested
person of the Trusts because he or she is affiliated with one or more of the
Trust's investment advisers. Trustees that are not interested persons of the
Trusts are referred to in this proxy statement as "Independent Trustees."
Each Trust is organized as a Delaware statutory trust and, as such, is not
required to hold annual meetings of shareholders. The Board has called the
Special Meeting in order to permit the shareholders to consider and vote on the
Proposal. If you wish to participate in the Special Meeting you may submit the
proxy card included with this proxy statement or attend in person. Your vote is
important no matter how many shares you own. You can vote easily and quickly by
mail, by Internet, by telephone or in person. At any time before the Special
Meeting, you may change your vote, even though a proxy has already been
returned, by written notice to the Trust c/o Touchstone, 303 Broadway, Suite
1100 Cincinnati, OH 45202 or by submitting a subsequent proxy, by mail, by
Internet, by telephone or by voting in person at the Special Meeting. Should
shareholders require additional information regarding any of the proposals
contained in the Proxy Statement, or replacement proxy cards, they may contact
the Trust at 1-800-543-0407.
In addition to the solicitation of proxies by mail, the Board and officers of
the Trusts, as well as employees of MIS, an ADP Company, a proxy soliciting firm
engaged by the Trusts, may solicit proxies in person or by telephone. Persons
holding shares as nominees will, upon request, be reimbursed for their
reasonable expenses incurred in sending soliciting materials to their
principals. The expenses of the Special Meeting will be borne proportionately by
each Fund of each Trust based on the assets of each Fund. The costs of the
Special Meeting and the preparation and mailing of this Proxy Statement, as well
as the costs associated with the solicitation of proxies, which is anticipated
to be $100,000.00.
Shares represented by duly executed proxies will be voted in accordance with the
instructions given. All proxy cards solicited that are properly executed and
received in time to be voted at the Special Meeting will be voted at the Special
Meeting or any adjournment thereof according to the instructions on the proxy
card. If no specification is made on a proxy card, it will be voted FOR the
matters specified on the proxy card.
QUORUM AND ADJOURNMENTS. Each whole share is entitled to one vote, and each
fractional share is entitled to a proportionate fractional vote on each matter
as to which such shares are to be voted at the Special Meeting. The holders of
40% of the Fund's shares entitled to vote constitutes a quorum. For purposes of
determining the presence of a quorum, abstentions or "broker non-votes" (as
defined below) will be counted as present and, therefore, will count towards a
quorum.
If a quorum is not present at the Special Meeting, or if a quorum is present at
the Special Meeting but sufficient votes to approve the Proposal are not
received, or if other matters arise requiring Shareholder attention, the persons
named as proxy agents may propose one or more adjournments of the Special
Meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of a majority of those shares present at the
Special Meeting or represented by proxy. The persons named as proxies will vote
those proxies that they are entitled to vote FOR the Proposal in favor of such
an adjournment with respect to the Proposal, and will vote those proxies
required to be voted AGAINST the Proposal, against such an adjournment for the
Proposal.
VOTE REQUIRED TO APPROVE PROPOSAL. With respect to the Proposal, provided that a
quorum is present, the affirmative vote of a plurality of the shares entitled to
vote among all Funds is required to elect the Trustees.
If your shares are held of record by a broker-dealer and you wish to vote in
person at the Special Meeting, you should obtain a legal proxy from your broker
of record and present it to the Inspector of Elections at the Special Meeting.
Abstentions and broker non-votes will have no effect with respect to the
Proposal or any adjournment with respect to the Proposal, which is the election
of Trustees and which requires approval by a plurality.
15
As used above, "broker non-votes" relate to shares that are held of record by a
broker-dealer for a beneficial owner who has not given instructions to such
broker-dealer. Pursuant to certain rules promulgated by the New York Stock
Exchange, Inc. that govern the voting by such broker-dealers, a broker-dealer
holding shares of record for a beneficial owner may not exercise discretionary
voting power with respect to certain non-routine matters (including the approval
of new investment management agreements), although such broker may be authorized
to vote such shares on routine matters for which it has discretionary authority
or has received instructions from the beneficial owner. Broker-dealers will have
discretionary authority to vote on the Proposal. The absence of such
instructions will result in a "broker non-vote" for that Proposal.
INVESTMENT ADVISER. Touchstone Advisors, Inc. ("Touchstone"), 303 Broadway,
Suite 1100, Cincinnati, OH 45202, serves as the investment adviser to the Funds.
ADMINISTRATOR. Touchstone also serves as each Fund's administrator pursuant to
an administrative agreement between the Trusts, on the Funds' behalf, and
Touchstone. Integrated Fund Services, Inc. currently serves as
Sub-Administrator. Its address is the same as that of Touchstone.
DISTRIBUTOR. Touchstone Securities, Inc. ("Touchstone Securities"), 303
Broadway, Cincinnati, Ohio 45202, is the principal underwriter of the Funds and,
as such, the exclusive agent for distribution of shares of the Funds under the
terms of a Distribution Agreement. Touchstone Securities is an affiliate of the
Advisor by reason of common ownership. Touchstone Securities is obligated to
sell the shares on a best efforts basis only against purchase orders for the
shares. Shares of each Fund are offered to the public on a continuous basis.
Touchstone Securities receives no compensation under the Distribution Agreement.
RECORD OWNERSHIP AND BENEFICIAL OWNERSHIP INFORMATION. The chart below depicts
the number of outstanding shares for each Fund as of the Record Date:
- ------------------------------------------------------------------------------------------------------------------------------------
NAME OF FUND NUMBER OF OUTSTANDING SHARES
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Small Cap Value Opportunities Fund 12,378,004.93
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Mid Cap Fund - Class Y 10,383,796.42
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Mid Cap Fund - Class Z 94,865.098
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Healthcare and Biotechnology Fund - Class A 3,204,013.77
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Healthcare and Biotechnology Fund - Class C 62.578
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Value Opportunities Fund - Class A 51.256
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Value Opportunities Fund - Class C 1,042.118
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Value Opportunities Fund - Class Z 5,149,538.06
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Small Cap Value Fund - Class A 140.805
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Small Cap Value Fund - Class C 596.599
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Small Cap Value Fund - Class Z 9,690,320.573
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Clover Core Fixed Income Fund 2,289,690.29
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Ultra Short Duration Fixed Income Fund 16,510,137.49
- ------------------------------------------------------------------------------------------------------------------------------------
16
- ------------------------------------------------------------------------------------------------------------------------------------
NAME OF FUND NUMBER OF OUTSTANDING SHARES
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Short Duration Fixed Income Fund 7,294,636.638
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone HLAM Large Cap Quality Stock Fund 842,777.899
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Value Fund - Class A 13,133,831.26
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Value Fund - Class C 75.643
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Diversified Growth Fund 19,078,987.08
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Pitcairn Select Value Fund 5,049,931.044
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Small Cap Fund - Class A 5,381,148.458
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Small Cap Fund - Class C 60.864
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Family Heritage(R) Fund - Class A 7,689,354.897
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Family Heritage(R) Fund - Class C 92.251
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Pitcairn Taxable Bond Fund 4,031,266.353
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Tax-Exempt Bond Fund 11,195,882.44
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Sands Capital Select Growth Fund - Class Y 23,948,369.46
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Sands Capital Select Growth Fund - Class Z 48,255,651.55
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone International Equity Fund - Class A 14,760,789.71
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone International Equity Fund - Class C 1,798.458
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Strategic Value and High Income Fund - Class A 65.963
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Strategic Value and High Income Fund - Class C 65.963
- ------------------------------------------------------------------------------------------------------------------------------------
Touchstone Strategic Value and High Income Fund - Class Y 152,747.076
- ------------------------------------------------------------------------------------------------------------------------------------
CIP Sands Capital Institutional Growth Portfolio 110,170,317.088
- ------------------------------------------------------------------------------------------------------------------------------------
CIP JSAM Large Cap Value Portfolio 1,982,277.847
- ------------------------------------------------------------------------------------------------------------------------------------
CIP JSAM Value Portfolio 834,498.566
- ------------------------------------------------------------------------------------------------------------------------------------
As of the Record Date, the following persons were the only persons who were
record owners or, to the knowledge of the Trusts, were beneficial owners of 5%
or more of the shares of the Fund, as indicated below by the number of shares
beneficially owned and the percentage of the Fund represented by such beneficial
ownership.
17
TOUCHSTONE HEALTHCARE AND BIOTECHNOLOGY FUND - CLASS A
CHARLES SCHWAB & CO INC. 63.50 %
No. of shares: 2,034,407.775
NATIONAL FINANCIAL SERVICES CORP 5.75 %
No. of shares: 184,199.512
TOUCHSTONE HEALTHCARE AND BIOTECHNOLOGY FUND - CLASS B
TOUCHSTONE ADVISORS 100 %
No. of shares: 62.578
TOUCHSTONE SMALL CAP VALUE OPPORTUNITIES FUND
CHARLES SCHWAB & CO INC. 53.75 %
No. of shares: 6,652,638.324
TOUCHSTONE VALUE OPPORTUNITIES FUND - CLASS A
TOUCHSTONE ADVISORS 100 %
No. of shares: 51.256
TOUCHSTONE VALUE OPPORTUNITIES FUND - CLASS C
PERSHING LLC 48.30 %
No. of shares: 503.305
PERSHING LLC 46.79 %
No. of shares: 487.557
TOUCHSTONE VALUE OPPORTUNITIES FUND - CLASS Z
CHARLES SCHWAB & CO INC. 7.80 %
No. of shares: 401,494.435
BILL & MELINDA GATES FOUNDATION 16.71 %
No. of shares: 860,386.164
TOUCHSTONE DIVERSIFIED SMALL CAP VALUE FUND - CLASS A
KEVIN J. ROMERO 73.65 %
UNIF GIFT MIN ACT No. of shares: 103.699
TOUCHSTONE ADVISORS 26.35 %
No. of shares: 37.106
TOUCHSTONE DIVERSIFIED SMALL CAP VALUE FUND - CLASS C
FIRST CLEARING LLC 93.78 %
FCC AS CUSTODIAN No. of shares: 559.493
PETER LERCH IRA
TOUCHSTONE ADVISORS 6.22 %
No. of shares: 37.106
18
TOUCHSTONE DIVERSIFIED SMALL CAP VALUE FUND - CLASS Z
CHARLES SCHWAB & CO INC. 37.13 %
No. of shares: 3,598,413.22
UMB BANK NA 12.41 %
SYSTEMS INC No. of shares: 1,202,318.292
TRST 40K TRUST PLAN
TOUCHSTONE CLOVER CORE FIXED INCOME FUND
CHARLES SCHWAB & CO INC. 13.70 %
ATTN MUTUAL FUNDS TEAM S No. of shares: 313,786.478
SEI PRIVATE TRUST CO 17.83 %
TRST C O HSBC No. of shares: 408,263.92
ADMINISTRATOR
TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND
CHARLES SCHWAB & CO 77.99 %
No. of shares: 12,875,522.38
TOUCHSTONE SHORT DURATION FIXED INCOME FUND
CHARLES SCHWAB & CO 92.45 %
No. of shares: 6,744,204.31
TOUCHSTONE STRATEGIC VALUE AND HIGH INCOME FUND - CLASS A
TOUCHSTONE ADVISORS 100 %
No. of shares: 65.963
TOUCHSTONE STRATEGIC VALUE AND HIGH INCOME FUND - CLASS C
TOUCHSTONE ADVISORS 00 %
No. of shares: 65.963
TOUCHSTONE STRATEGIC VALUE AND HIGH INCOME FUND - CLASS Y
MURIEL J PETER J MORAN TR 6.24 %
FAMILY TRUST No. of shares: 9,537.534
MORAN III
NFS LLC FEBO 6.74 %
ROBERT R HUFF AND SUSAN FEIDNER HUFF No. of shares: 10,289.166
19
TOUCHSTONE DIVERSIFIED VALUE FUND - CLASS A
PITCAIRN TRUST COMPANY 20.06 %
CASH/CASH CAPITAL GAINS No. of shares: 2,635,069.141
PITCAIRN TRUST COMPANY 6.45 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 847,675.793
PITCAIRN TRUST COMPANY 68.37 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 8,979,433.931
TOUCHSTONE DIVERSIFIED VALUE FUND - CLASS C
TOUCHSTONE ADVISORS 100 %
No. of shares: 75.643
TOUCHSTONE PITCAIRN SELECT VALUE FUND
PITCAIRN TRUST COMPANY 13.92 %
CASH/CASH CAPITAL GAINS No. of shares: 702,842.329
PITCAIRN TRUST COMPANY 63.98 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 3,231,194.616
PITCAIRN TRUST COMPANY 18.91 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 955,113.853
TOUCHSTONE DIVERSIFIED GROWTH FUND
PITCAIRN TRUST COMPANY 19.05 %
CASH/CASH CAPITAL GAINS No. of shares: 3,634,708.036
PITCAIRN TRUST COMPANY 6.64 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 1,266,385.618
PITCAIRN TRUST COMPANY 72.12 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 13,760,589.07
TOUCHSTONE SMALL CAP FUND - CLASS A
PITCAIRN TRUST COMPANY 65.84 %
CASH/CASH CAPITAL GAINS No. of shares: 3,543,051.586
PITCAIRN TRUST COMPANY 8.04 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 432,596.911
PITCAIRN TRUST COMPANY 22.87 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 1,230,651.979
TOUCHSTONE SMALL CAP FUND - CLASS C
TOUCHSTONE ADVISORS 100 %
No. of shares: 60.864
20
TOUCHSTONE FAMILY HERITAGE(R) FUND - CLASS A
PITCAIRN TRUST COMPANY 12.37 %
CASH/CASH CAPITAL GAINS No. of shares: 951,508.372
PITCAIRN TRUST COMPANY 18.47 %
CASH/REINVEST CAPITAL GAINS No. of shares: 1,420,167.619
PITCAIRN TRUST COMPANY 64.66 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 4,971,904.666
TOUCHSTONE FAMILY HERITAGE(R) FUND - CLASS C
TOUCHSTONE ADVISORS 100 %
No. of shares: 92.251
TOUCHSTONE PITCAIRN TAXABLE BOND FUND
PITCAIRN TRUST COMPANY 14.58 %
CASH/CASH CAPITAL GAINS No. of shares: 587,725.173
PITCAIRN TRUST COMPANY 58.67 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 2,365,160.217
PITCAIRN TRUST COMPANY 20.03 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 807,443.974
TOUCHSTONE TAX EXEMPT BOND FUND
PITCAIRN TRUST COMPANY 81.90 %
CASH/CASH CAPITAL GAINS No. of shares: 9,169,071.3
PITCAIRN TRUST COMPANY 11.56 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 1,293,699.192
TOUCHSTONE SANDS CAPITAL SELECT GROWTH FUND CLASS Y
CHARLES SCHWAB & CO. INC. 30.28 %
No. of shares: 7,252,625.971
NATIONAL FINANCIAL SERVICES CORP 5.13 %
No. of shares: 1,227,546.65
SAXON AND CO 16.69 %
No. of shares: 3,996,521.705
THE VANGUARD FIDUCIARY TRUST CO 25.55 %
No. of shares: 6,119,283.206
21
TOUCHSTONE SANDS CAPITAL SELECT GROWTH FUND CLASS Z
CHARLES SCHWAB & CO. INC. 33.00 %
No. of shares: 15,923,542.22
CITIGROUP GLOBAL MARKETS INC. 38.63 %
No. of shares: 18,640,733.05
PITCAIRN TRUST COMPANY 8.57 %
CASH/CASH CAPITAL GAINS No. of shares: 4,136,224.35
TOUCHSTONE INTERNATIONAL EQUITY FUND - CLASS A
PITCAIRN TRUST COMPANY 67.74 %
CASH/CASH CAPITAL GAINS No. of shares: 9,998,663.982
PITCAIRN TRUST COMPANY 9.71 %
CASH/REIN VEST CAPITAL GAINS No. of shares: 1,432,73 1.193
PITCAIRN TRUST COMPANY 16.26 %
REINVEST/REINVEST CAPITAL GAINS No. of shares: 2,400,715.3
TOUCHSTONE INTERNATIONAL EQUITY FUND - CLASS C
PERSHING LLC 24.67 %
No. of shares: 443.623
PERSHING LLC 25.48 %
No. of shares: 458.295
PERSHING LLC 22.59 %
No. of shares: 406.279
PERSHING LLC 21.99 %
No. of shares: 395.564
TOUCHSTONE ADVISORS 5.27 %
No. of shares: 94.697
TOUCHSTONE MID CAP FUND CLASS Y
PATTERSON CO OMNIBUS CASH CASH 65.37 %
AND 9999999980 NC1151 No. of shares: 6,787,552.827
PATTERSON CO OMNIBUS REIN REIN 26.86 %
AND 9999999971 NC1151 No. of shares: 2,789,448.001
22
TOUCHSTONE MID CAP FUND CLASS Z
STRAFE CO 16.84 %
DERM SRF NP PCIAA No. of shares: 15,974.441
STRAFE CO 5.41 %
REV TRUST PCIAA No. of shares: 5,131.393
STRAFE CO 6.89 %
PCIAA No. of shares: 6,535.119
STRAFE CO 5.52 %
GRIMLAND PCIAA No. of shares: 5,232.178
STRAFE CO 6.52 %
ESSENBURG TR PCIAA No. of shares: 6,189.555
STRAFE CO 6.86 %
TRUST PCIAA No. of shares: 6,509.253
STRAFE CO 5.03 %
PCIAA No. of shares: 4,775.57
CIP JSAM VALUE PORTFOLIO
CHARLES SCHWAB & CO INC. 79.66%
REINVEST ACCOUNT No. of shares: 664,801.404
ATTN MUTUAL FUNDS
CIP JSAM LARGE CAP VALUE PORTFOLIO
CHARLES SCHWAB & CO INC. 69.37 %
REINVEST ACCOUNT No. of shares: 1,375,184.060
ATTN MUTUAL FUNDS
NATIONAL INVESTOR SERVICES FBO 9.90 %
097-50000-19 No. of shares: 196,293.276
HIGH POINT REGIONAL HEALTH SYSTEM 6.99 %
No. of shares: 138,680.639
MERRILL LYNCH PIERCE FENNER & SMITH INC 5.86 %
FOR THE SOLE BENEFIT OF ITS CUSTOMERS No. of shares: 116,114.855
CIP SANDS CAPITAL INSTL GROWTH PORTFOLIO
PRUDENTIAL INVESTMENT MGT SERVICES 33.70 %
FBO MUTUAL FUND CLIENTS No. of shares: 37,116,223.604
ATTN PRUCHOICE UNIT NJ-05--20
CHARLES SCHWAB & CO INC. 11.98 %
REINVEST ACCOUNT No. of shares: 13,194,919.960
ATTN MUTUAL FUNDS
T ROWE PRICE 5.78 %
RETIREMENT PLAN SERVICES INC No. of shares: 6,371,464.052
FBO INTERMOUNTAIN HEALTHCARE
23
To the best of the Fund's knowledge, as of the Record Date, no Trustee or
officer of the Trusts owned beneficially more than 1% of a Fund's outstanding
shares.
SHAREHOLDERS SHARING THE SAME ADDRESS. If two or more shareholders share the
same address, only one copy of this proxy statement is being delivered to that
address, unless the Trust has received contrary instructions from one or more of
the shareholders at that shared address. Upon written or oral request, the Trust
will deliver promptly a separate copy of this proxy statement to a shareholder
at a shared address. Please note that each Shareholder will receive a separate
proxy card, regardless of whether he or she resides at a shared address. Please
call 1-800-543-0407 or forward a written request to the Trust c/o Touchstone,
303 Broadway, Suite 1100 Cincinnati, OH 45202 if you would like to (1) receive a
separate copy of this proxy statement; (2) receive your annual reports or proxy
statements separately in the future; or (3) request delivery of a single copy of
annual reports or proxy statements if you are currently receiving multiple
copies at a shared address.
OTHER BUSINESS. The Board does not intend to present any other business at the
Special Meeting. If any other matter may properly come before the Special
Meeting, or any adjournment thereof, the persons named in the accompanying proxy
card(s) intend to vote, act, or consent thereunder in accordance with their best
judgment at that time on such matters. No annual or other special meeting is
currently scheduled for the Trusts. Mere submission of a shareholder proposal
does not guarantee the inclusion of the proposal in the proxy statement or
presentation of the proposal at the Special Meeting because inclusion and
presentation are subject to compliance with certain federal regulations.
SHAREHOLDER PROPOSALS. The Trust is not required to hold annual shareholder
meetings. Shareholders wishing to submit proposals for inclusion or presentation
in a proxy statement for a future meeting should send their written proposals to
the Secretary of the Trusts c/o Touchstone, 303 Broadway, Suite 1100 Cincinnati,
OH 45202. Shareholder proposals must be received by the Trust within a
reasonable time before any such meeting in order for the proposals to be
considered.
COMMUNICATIONS WITH THE BOARD. Shareholders wishing to submit written
communications to the Board should send their communications to the Touchstone
Fund Group, c/o Touchstone, 303 Broadway, Suite 1100 Cincinnati, OH 45202. Any
such communications received will be reviewed by the Board at its next regularly
scheduled meeting.
ANNUAL REPORT TO SHAREHOLDERS. The Annual Report of the Trusts for the fiscal
years ended September 30, 2006 and December 31, 2005 is available on request.
The Annual Report may be obtained by written request to the Trust at the address
listed above, or by telephoning 1-800-543-0407.
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY CARD(S) IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE, ALONG
WITH INSTRUCTIONS ON HOW TO VOTE OVER THE INTERNET OR BY TELEPHONE SHOULD YOU
PREFER TO VOTE BY ONE OF THOSE METHODS.
TSF-59-PROXY-062
24
PROXY TABULATOR
P.O. BOX 9112
TELEPHONE AND INTERNET VOTING INSTRUCTIONS:
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TO VOTE BY TELEPHONE: TO VOTE BY INTERNET: VOTE BY MAIL:
1) Read the proxy statement and have this 1) Read the proxy statement and have this 1) Read the proxy statement and have this
proxy card at hand. proxy card at hand. proxy card at hand.
2) Call toll-free 1-888-221-0697 2) Go to WWW.PROXYWEB.COM 2) Check the appropriate box on reverse.
3) Follow the recorded instructions. 3) Follow the on-line instructions. 3) Sign and date proxy card in the envelope
provided.
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TOUCHSTONE FUNDS GROUP TRUST AND
CONSTELLATION INSTITUTIONAL PORTFOLIOS
303 BROADWAY, SUITE 1100 CINCINNATI, OH 45202
NOTICE
OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 5, 2007
Notice is hereby given that a special meeting of shareholders (the "Special
Meeting") of Touchstone Funds Group Trust and Constellation Institutional
Portfolios (each a "Trust" and collectively the "Trusts") will be held at the
office of Touchstone Advisors, Inc., 303 Broadway, Suite 1100 Cincinnati, OH
45202, on February 5, 2007, at 10:00 a.m. (Eastern time). The purpose of the
Special Meeting is to consider the Proposal set forth on the reverse side and to
transact such other business as may be properly brought before the Special
Meeting or any adjournment(s) thereof. The specifics of this Proposal, which is
more fully described in the attached Proxy Statement, are shown on the reverse
side of the card.
The undersigned shareholder(s) of the referenced Touchstone Funds of the
Touchstone Funds Group Trust and Constellation Institutional Portfolios hereby
appoints Jay S. Fitton and Frank L. Newbauer, or any one of them true and lawful
attorneys with power of substitution of each, to vote all shares which the
undersigned is entitled to vote, at the Special Meeting of Shareholders of the
Funds to be held on February 5, 2007, at the offices of the Trusts, 303
Broadway, Suite 1100 Cincinnati, OH 45202, at 10:00 a.m. local time, and at any
adjournment thereof as indicated on the reverse side. In its discretion, the
Trust is authorized to vote upon such other matters as may properly come before
the meeting.
RECEIPT OF THE NOTICE(S) OF THE SPECIAL MEETING AND THE ACCOMPANYING PROXY
STATEMENT(S), AS APPLICABLE, IS HEREBY ACKNOWLEDGED. THE SHARES REPRESENTED
HEREBY WILL BE VOTED AS INDICATED OR FOR THE PROPOSAL IF NO CHOICE IS INDICATED.
Date ________________
PLEASE SIGN, DATE AND RETURN YOUR VOTING INSTRUCTIONS
TODAY.
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Signature(s) (PLEASE SIGN IN THE BOX)
Please date and sign exactly as the name or names appear on this card. When
signing as attorney, trustee, executor, administrator, custodian, guardian or
corporate officer, please give full title. If shares are held jointly, each
shareholder should sign.
Constellation 06 kw
PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK
OR NUMBER 2 PENCIL. X PLEASE DO NOT USE FINE POINT PENS.
Please refer to the Proxy Statement discussion for this Proposal. If you
simply sign the proxy without specifying a vote, your shares will be voted FOR
the Proposal in accordance with the recommendation of the Board of Trustees, As
to any other matter, said proxy holders shall vote in accordance with the views
of management.
The Board of Trustees recommends a vote "FOR" the Proposal.
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT*
|_| |_| |_|
Proposal To elect four additional Trustees for the Board of the Trust, as
follows:
(01) Richard L. Brenan, (02) H. Jerome Lerner, (03) John P. Zanotti and
(04) John F. Barrett
(INSTRUCTION : To withhold authority to vote for any individual
Nominee(s), write the number(s) of the Nominee(s) on the line below :)
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PLEASE SIGN, DATE AND RETURN IN THE ENCLOSED ENVELOPE.