UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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
[_] Definitive additional materials
[_] Soliciting material pursuant to ss.240.14a-12
Touchstone Funds Group Trust
--------------------------
(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:
TOUCHSTONE FUNDS GROUP TRUST
303 Broadway, Suite 1100
Cincinnati, OH 45202
Dear Valued Shareholder:
The proxy statement that accompanies this letter describes a proposal to approve
a new sub-advisory agreement for the Ultra Short Duration Fixed Income Fund. The
Board of Trustees has approved this proposal and recommends that you vote FOR
the proposal.
Please read the proxy carefully. It explains the current sub-advisory agreement
and the reasons for the proposed new sub-advisory agreement.
Your vote is important regardless of how many shares you own. Please cast your
vote promptly using the enclosed card and postage-paid envelope, by phone using
the toll-free number, or via the Internet.
We appreciate your business and the trust you have placed in us. We look forward
to serving you for many years to come.
Sincerely,
/s/ Jill T. McGruder
Jill T. McGruder
President
Touchstone Funds Group Trust
TOUCHSTONE FUNDS GROUP TRUST
303 Broadway, Suite 1100
Cincinnati, OH 45202
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 20, 2009
Notice is hereby given that a Special Meeting of Shareholders (the "Special
Meeting") of Touchstone Funds Group Trust (the "Trust") with respect to the
Ultra Short Duration Fixed Income Fund (the "Fund") will be held at the offices
of the Trust, 303 Broadway Suite 1100, Cincinnati, OH 45202, at 10:00 a.m.
Eastern Time, on February 20, 2009 for the purpose of approving a new
sub-advisory agreement between the Fund's investment advisor, Touchstone
Advisors, Inc. (the "Advisor") and Fort Washington Investment Advisors, Inc.
("FWIA").
Shareholders of record as of the close of business on December 1, 2008 are
entitled to notice of, and to vote at the Special Meeting, or any adjournment of
this meeting.
By Order of the Board of Trustees,
/s/ Jay S. Fitton
Jay S. Fitton
Secretary
December 5, 2008
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE SPECIAL MEETING ARE REQUESTED TO
COMPLETE, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE,
WHICH NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. SHAREHOLDERS MAY ALSO
VOTE BY TELEPHONE OR VOTE THROUGH THE INTERNET. INSTRUCTIONS FOR THE PROPER
EXECUTION OF THE PROXY ARE SET FORTH IMMEDIATELY FOLLOWING THIS NOTICE OR, WITH
RESPECT TO TELEPHONE OR INTERNET VOTING, ON THE PROXY CARD. IT IS IMPORTANT THAT
YOU VOTE PROMPTLY.
2
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of
assistance to you and avoid the time and expense to the Trust in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to the name shown in the registration
on the proxy card.
3. All Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of
registration. For example:
REGISTRATION VALID SIGNATURE
CORPORATE ACCOUNTS
(1) ABC Corp. . . . . . . . . . . . . . . ABC Corp.
(2) ABC Corp. . . . . . . . . . . . . . . John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer . . . . . . . John Doe
(4) ABC Corp. Profit Sharing Plan . . . . John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust . . . . . . . . . . . . . . Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78 . . . . . . . . . . . .Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA . . . . John B. Smith
(2) Estate of John B. Smith . . . . . . . John B. Smith, Jr., Executor
3
TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND
OF THE
TOUCHSTONE FUNDS GROUP TRUST
303 Broadway, Suite 1100
Cincinnati, Ohio 45202
(800) 543-0407
SPECIAL MEETING OF SHAREHOLDERS
To be held on February 20, 2009
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board") of Touchstone Funds Group Trust (the
"Trust") from the shareholders of the Touchstone Ultra Short Duration Fixed
Income Fund (the "Fund"), a series of the Trust, for use at the special meeting
of shareholders to be held at 10:00 a.m. on February 20, 2009 (the "Meeting")
and any adjournment(s) thereof. The Meeting will be held at the offices of the
Trust, 303 Broadway, Suite 1100, Cincinnati, Ohio 45202 for the purposes of
approving a new sub-advisory agreement between the Fund's investment advisor,
Touchstone Advisors, Inc. (the "Advisor") and Fort Washington Investment
Advisors, Inc. ("FWIA").
This Proxy Statement is furnished to the shareholders of the Fund. This Proxy
Statement, the Notice of Special Meeting and the proxy cards are being mailed to
shareholders on or about December 5, 2008 or as soon as practicable thereafter.
Shareholders of record of the Fund at the close of business on December 1, 2008
(the "Record Date") will be entitled to one vote per share for each full share
of the Fund, with proportionate voting for fractional shares.
It is expected that the solicitation of proxies will be made primarily by mail.
Supplemental solicitations may be made by mail, telephone, facsimile, internet
or personal contact by representatives of the Trust. All costs associated with
the preparation, filing and distribution of this Proxy Statement, the
solicitation and the Meeting will be borne by the Advisor.
Any shareholder submitting a proxy has the power to revoke it by attending and
voting in person at the Meeting, by mailing a notice of revocation to the
Secretary of the Trust at the principal office of the Trust, or by executing a
superseding proxy by telephone or through the internet to the Trust. All
properly executed proxies received before the Meeting will be voted as specified
in the Proxy.
A COPY OF THE TRUST'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2008
IS AVAILABLE FREE OF CHARGE, BY DOWNLOADING IT FROM THE TOUCHSTONE FUNDS'
WEBSITE WWW.TOUCHSTONEINVESTMENTS.COM, BY CALLING 800-543-0407 OR BY WRITING TO
TOUCHSTONE FUNDS GROUP TRUST, TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND,
303 BROADWAY, SUITE 1100, CINCINNATI, OHIO 45202.
4
RECOMMENDATION OF THE BOARD OF TRUSTEES
On November 13, 2008, at a regular meeting, the Board of Trustees, including a
majority of the Trustees who are not "interested persons" pursuant to Section
2(a)(19) of the Investment Company Act of 1940 (the "1940 Act") (the
"Disinterested Trustees"), considered certain information with respect to a
proposal to change the sub-advisor of the Fund.
As a result, the Board of Trustees of the Trust recommends that shareholders of
the Fund vote FOR the approval of FWIA as the sub-advisor to the Fund.
PROPOSAL
THE NEW AGREEMENT
On September 30, 2008, the Board held a special meeting by telephone to consider
management's proposal for various options for the Fund's investment management.
At that meeting, the Advisor recommended that the Board terminate Chartwell
Investment Partners ("Chartwell") as the sub-adviser to the Fund based on the
manner in which Chartwell implemented the Fund's investment strategy. The Board
determined that it was in the best interests of shareholders to immediately
terminate the existing sub-advisory agreement (the "Old Agreement") with
Chartwell, select an interim sub-advisor and approve an interim sub-advisory
agreement. After considering information provided by the Advisor, the Board
determined that it would be most efficient to transition the day to day
management of the Fund to FWIA. As a result, the Board approved FWIA to act as
interim sub-advisor and approved an interim sub-advisory agreement between the
Advisor and FWIA for the Fund (the "Interim Agreement"). On November 13, 2008,
the Board approved, subject to shareholder approval, a new sub-advisory
agreement (the "New Agreement") with FWIA for the Fund.
FWIA's fee rate for its services to the Fund under the New Agreement is the same
as the fee rate paid under the Interim Agreement and the same as Chartwell's fee
rate under the Old Agreement (the Advisor is responsible for the payment of fees
to FWIA for services it performs for the Fund). There are no material
differences between the New Agreement and the Old Agreement.
The New Agreement must be voted upon by the shareholders of the Fund. The New
Agreement is expected to take effect on February 27, 2009, following shareholder
approval.
THE INTERIM ADVISORY AGREEMENT
During the period between the termination of the Old Agreement and the approval
of the New Agreement by shareholders (the "Interim Period"), FWIA has provided
investment sub-advisory services to the Fund pursuant to an interim agreement
between the Advisor and FWIA that was approved by the Board at a special meeting
it held on September 30, 2008 (the "Interim Agreement"). The Interim Agreement
is identical in all respects (including fees to be paid to FWIA) to the New
Agreement, except for the time period covered by the agreement. The Interim
Agreement provides for a termination date no greater that 150 days from the date
of the termination of the Old Agreements, or upon approval of a new sub-advisory
agreement by shareholders, whichever is shorter.
5
SUMMARY OF THE NEW AGREEMENT
The form of the New Agreement is attached as Appendix A to this Proxy Statement.
A description of the proposed New Agreement is set forth below and is qualified
in its entirety by reference to Appendix A.
GENERAL. FWIA will manage the investment and reinvestment of the Fund Assets,
subject to and in accordance with the investment objectives, policies and
restrictions of the Fund and in conformity with the Fund's currently effective
Registration Statement. FWIA will make all determinations with respect to the
investment of the Fund Assets and the purchase and sale of portfolio securities.
FWIA also will determine the manner in which voting rights, rights to consent to
corporate action and any other rights pertaining to the portfolio securities
will be exercised. FWIA will provide periodic reports to the Board. FWIA will
place orders for portfolio transactions on behalf of the Fund in accordance with
Trust policies and shall be responsible for obtaining best execution.
COMPENSATION. For services rendered, the Advisor will pay FWIA a sub-advisory
fee, which is accrued daily and payable monthly at the annual rate of 0.125% of
the Fund's average daily net assets.
LIABILITY. FWIA shall indemnify and hold harmless the Trust and all affiliated
persons thereof against any and all losses, claims, damages, liabilities or
litigation (including reasonable legal and other expenses) by reason of or
arising out of: (a) FWIA being in material violation of any applicable federal
or state law, rule or regulation or any investment policy or restriction set
forth in the Funds' Registration Statement or any written guidelines or
instruction provided in writing by the Board, or (b) the FWIA's willful
misfeasance, bad faith or gross negligence generally in the performance of its
duties hereunder or its reckless disregard of its obligations and duties under
this Agreement.
LIMIT ON TRUST LIABILITY. FWIA agrees that (i) the Trust's obligations to FWIA
under the New Agreement (or indirectly under the Advisory Agreement) shall be
limited in any event to the Fund Assets and (ii) FWIA shall not seek
satisfaction of any such obligation from the holders of shares of the Fund,
other than the Advisor, nor from any Trustee, officer, employee or agent of the
Trust.
TERM. The New Agreement is expected to remain in effect through February 27,
2011, and, unless earlier terminated, will continue from year to year
thereafter, provided that each such continuance is approved annually (i) by the
Board or by the vote of a majority of the outstanding voting securities of the
Fund, and, in either case, (ii) by a majority of the Independent Trustees.
AMENDMENT. The New Agreement may be amended at any time by the parties to the
New Agreement, subject to approval by the Board and, if required by applicable
SEC rules and regulations, a vote of the majority of the outstanding voting
securities of the Fund affected by such change.
TERMINATION. Under the terms of the New Agreement, the New Agreement may be
terminated at any time, without payment of any penalty, (i) by the Advisor upon
not more than sixty (60) days' nor less than thirty (30) days' written notice;
(ii) by the Sub-Advisor upon not less than sixty (60) days' written notice; or
(iii) by the Trust upon either (y) the majority vote of its Board or (z) the
affirmative vote of a majority of the outstanding voting securities of the Fund.
The New Agreement will terminate automatically in the event of its "assignment"
as such term is defined under the 1940 Act.
6
INFORMATION ABOUT FWIA
FWIA is organized as a corporation under the laws of the State of Ohio. The main
offices of FWIA are located at 303 Broadway, Suite 1200, Cincinnati, Ohio 45202.
FWIA was founded in May 1990 and is the money management and primary investment
arm of Western & Southern Financial Group with more than $26.8 billion in assets
under management as of September 30, 2008. FWIA is a registered investment
advisor with expertise in fixed income, public equity and private equity.
Clients include institutions and high-net-worth individuals throughout the
country.
FWIA is an affiliate of the Advisor. Therefore, the Advisor may have a conflict
of interest when making decisions to keep FWIA as the Fund's Sub-Advisor. The
Board reviews the Advisor's decisions with respect to the retention of FWIA, to
reduce the possibility of a conflict of interest situation.
FWIA's ultra short duration strategy seeks to outperform cash alternatives such
as money market funds while assuming a small degree of additional price
volatility. The strategy tends to emphasize yield rather than price appreciation
and de-emphasizes active trading with most securities being held to maturity.
The ultra short duration strategy employs a team of dedicated sector
specialists, believing the complexities of structure, credit, relative value and
econometric modeling demand a detailed knowledge of each facet of the investment
process. The strategy focuses primarily on mortgage-backed and asset-backed
securities which tend to have more complex and uncertain cash flows, thus
offering the potential for more inefficient markets. Capitalizing on these
inefficiencies and focusing on the yield component of return is designed to
produce an attractive risk/return profile.
FWIA's ultra short strategy is managed by a team including Scott D. Weston and
Brent A. Miller, CFA. Mr. Weston has been a Vice President and Senior Portfolio
Manager of FWIA since 1999. He is also FWIA's lead sector specialist in
mortgage-backed and asset-backed securities. Mr. Weston is a graduate of the
University of Utah with a BS in Finance and the University of Cincinnati with an
MBA in Finance. He has investment experience dating back to 1992. Mr. Miller has
been a Portfolio Manager at FWIA since 2001 with an emphasis on mortgage-backed
and asset-backed securities. Mr. Miller graduated Magna Cum Laude from the
University of Evansville with a BS in Mathematics. He has investment experience
dating back to 1999.
The following table lists the name, address and principal occupation of the
principal executive officer and each director or general partner of FWIA:
- ---------------------------------- ---------------------------------- ----------------------------------------
Name Principal Occupation Address
- ---------------------------------- ---------------------------------- ----------------------------------------
Maribeth S. Rahe President and Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Nicholas P. Sargen Chief Investment Officer and 303 Broadway, Suite 1200, Cincinnati,
Director OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
John F. Barrett, Chairman and Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Brendan M. White Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
7
- ---------------------------------- ---------------------------------- ----------------------------------------
James A. Markley Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Roger M. Lanham Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
John J. O'Connor Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Timothy J. Policinksi Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Donald J. Wuebbling Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Margaret C. Bell Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Robert L. Walker Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Richard Jandrain III Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Stephen A. Baker Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Christopher L. Baucom Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
Mark A. Frietch Managing Director 303 Broadway, Suite 1200, Cincinnati,
OH 45202
- ---------------------------------- ---------------------------------- ----------------------------------------
BOARD CONSIDERATION IN APPROVING THE NEW AGREEMENT
In conjunction with its approval of the Interim Agreement and the New Agreement,
the Board considered the current marketplace for ultra short duration funds. The
Advisor concluded that investors generally expect ultra short funds to provide
principal preservation and a competitive yield. The Advisor expects increased
demand for ultra short funds that invest primarily in government securities,
such as the Fund. The Advisor also expects that investors will pay particularly
close attention to the stability of the net asset value of ultra short funds. In
light of the Advisor's research and recommendation, the Board concluded that the
Fund's focus on capital preservation and reasonable price stability are
favorable attributes, and FWIA's conservative investment approach is
appropriately suited to provide principal preservation and a stable net asset
value for the Fund.
In determining whether to approve the New Agreement, the Board considered
information provided by FWIA and the Advisor. The information provided to the
Board included: (1) services to be performed for the Fund, (2) the size and
qualifications of the FWIA's portfolio management staff, (3) how the Fund will
be managed, including a general description of the proposed investment
decision-making process, sources of information and investment strategies, (4)
investment performance information for similarly managed accounts, (5) industry
data comparing advisory fees and expense ratios of comparable investment
companies, (6) brokerage selection procedures, (7) the procedures for allocating
investment opportunities between the Fund and other clients and (8) FWIA's
internal program for ensuring compliance with the Fund's investment objectives,
policies and practices (including codes of ethics), federal securities laws and
other regulatory requirements. The Board also considered the potential conflict
of interest of the Advisor in recommending the engagement of an affiliated
sub-advisor.
8
Prior to voting, the Independent Trustees reviewed the New Agreement with
management and with independent legal counsel and received advice from such
counsel discussing the legal standards for their consideration of the New
Agreement. The Independent Trustees also reviewed the New Agreement in executive
session with counsel at which time no representatives of management were
present.
As previously discussed, the Board unanimously determined that the proposal to
approve the New Agreement would be in the best interests of the Fund. In
determining whether to approve the New Agreement and to recommend its approval
to shareholders, the Board considered, with the assistance of independent legal
counsel, the following factors, in addition to all other information it deemed
relevant, and drew the following conclusions:
(i) The Board is very familiar with FWIA and its staff since FWIA also
sub-advises the following Touchstone funds: TST Diversified Small Cap
Growth Fund, TINT Core Bond Fund, TVST Core Bond Fund, TINT High Yield
Fund, TVST High Yield Fund, TTFT Ohio Tax-Free Bond Fund, and all six of
Touchstone's money market funds and concluded that the nature, extent
and quality of the services to be provided by FWIA will be consistent
with industry norms and that the Fund should benefit from adding FWIA as
a sub-advisor;
(ii) FWIA's conservative investment style is a strong match for the Fund's
emphasis on capital preservation;
(iii) FWIA's familiarity with the portfolio of the Fund and its
mortgage-backed securities expertise will allow FWIA to manage the
effective duration of the Fund and position the portfolio in accordance
with the Fund's principal investment strategies and the best interests
of shareholders;
(iv) the Board reviewed the investment performance of a representative
account that FWIA manages, which has the same investment strategy as the
Fund and concluded that the performance was reasonable;
(v) the fees proposed to be paid by the Advisor to FWIA for its services to
the Fund pursuant to the terms of the New Agreement are identical to the
fees which the Board had previously approved to be paid by the Advisor
to Chartwell for its services to the Fund, and the Board's conclusion
that the fees were reasonable in light of the services to be provided;
(vi) the Board did not consider the costs of services provided by FWIA or the
profitability to FWIA from its relationship with the Fund because it did
not view these factors as relevant given that the sub-advisory fee is
paid by the Advisor; and
(vii) the current and historic asset levels of the Fund and the Board's
conclusion that asset levels were not of a sufficient magnitude as to
represent a likelihood of economies of scale being realized in the
near-term by FWIA, and, thus, did not deem it necessary to make a
determination as to whether the sub-advisory fees proposed to be paid to
FWIA made accommodations for such economies of scale.
In drawing its conclusions with regard to the above factors and determining not
only to unanimously approve the New Agreement, but also to recommend that
Shareholders approve the New Agreement, the Board did not identify any single
piece of information that was all-important, controlling or determinative of its
decision.
9
QUORUM & REQUIRED VOTE
For the Trust, except when a larger quorum is required by applicable law (as it
is in the case of the proposal as further discussed in the following paragraph),
the By-Laws or the Trust's Declaration of Trust, 40% of the shares entitled to
vote constitute a quorum at a shareholder's meeting. When any one or more series
(or classes) is to vote as a single class separate from any other shares, 40% of
the shares of each such series (or classes) entitled to vote constitute a quorum
at a shareholder meeting of that series. Any shareholder meeting may be
adjourned by a majority of the votes cast upon the question of adjourning a
meeting to another date and time whether or not a quorum is present.
Approval of the New Agreement will require the affirmative "vote of a majority
of the outstanding voting securities" of the Fund as defined by the 1940 Act.
This means the lesser of (1) 67% or more of the shares of the Fund present at
the Meeting if the owners of more than 50% of the shares then outstanding are
present in person or by proxy, or (2) more than 50% of the outstanding shares of
the Fund entitled to vote at the Meeting. If sufficient votes to approve the New
Agreement are not received, the persons named as proxies may propose one or more
adjournments of the Meeting to permit further solicitation of voting
instructions. In determining whether to adjourn the Meeting, the following
factors may be considered: the percentage of votes actually cast, the percentage
of negative votes actually cast, the nature of any further solicitation and the
information to be provided to shareholders with respect to the reasons for the
solicitation. Any adjournment will require an affirmative vote of a majority of
those shares represented at the Meeting in person or by proxy. The persons named
as proxies will vote upon such adjournment after consideration of all
circumstances which may bear upon a decision to adjourn the Meeting.
Proxies that reflect abstentions and "broker non-votes" (i.e., shares held by
brokers or nominees as to which (i) instructions have not been received from the
beneficial owners or the persons entitled to vote and (ii) the broker or nominee
does not have discretionary voting power on a particular matter) will be counted
as shares that are present and entitled to vote for purposes of determining the
presence of a quorum, but will have the effect of being counted as votes against
the proposal of the New Agreement, which must be approved in the manner
discussed in the preceding paragraph.
ADDITIONAL INFORMATION
SHARES OUTSTANDING
At the close of business on the Record Date, the number of outstanding shares of
beneficial interest for the Fund was 13,599,734.76.
SHARE OWNERSHIP INFORMATION
As of the Record Date, the following table lists those shareholders who
beneficially owned 5% or more of the outstanding shares of the Fund.
10
- ---------------------------------- --------------------- -----------------------
Name and Address Number of Shares Percent of Fund
- ---------------------------------- --------------------- -----------------------
Charles Schwab Co. 11,064,716.15 81.36%
101 Montgomery Street
San Francisco, CA 94104
- ---------------------------------- --------------------- -----------------------
As of the Record Date, the Trustees and Officers of the Trust as a group owned
of record and beneficially none of the outstanding shares of the Fund.
INVESTMENT ADVISOR AND OTHER SERVICE PROVIDERS
Touchstone Advisors, Inc., (the "Advisor") located at 303 Broadway, Suite 1100,
Cincinnati, Ohio 45202, serves as the investment advisor to the Trust.
Touchstone Securities, Inc. (the "Underwriter") serves as the principal
underwriter of the shares of the Trust. The address of the Underwriter is 303
Broadway, Suite 1100, Cincinnati, Ohio 45202.
The Advisor serves as the administrator for the Trust.
Both the Advisor and the Underwriter are wholly owned subsidiaries of IFS
Financial Services, Inc., which is a wholly owned subsidiary of Western-Southern
Life Assurance Company ("WSLAC"). WSLAC is a wholly owned subsidiary of The
Western and Southern Life Insurance Company, a stock life insurance company
organized under the laws of the State of Ohio on February 23, 1888 ("WSLIC").
FWIA is a wholly owned subsidiary of WSLIC. WSLIC is wholly owned by an
Ohio-domiciled intermediate holding company, Western-Southern Financial Group,
Inc. ("WSFG"). WSFG is wholly owned by an Ohio-domiciled mutual insurance
holding company, Western-Southern Mutual Holding Company ("WSMH"). WSLAC is in
the business of issuing insurance and annuity contracts. The address of WSLAC,
WSLIC, WSFG and WSMH is 400 Broadway, Cincinnati, Ohio 45202.
The following officers of the Trust hold positions with the Advisor, the
Underwriter and FWIA:
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
Name Position with the Position with the Position with the Position with FWIA
Trust Advisor Underwriter
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
Jill T. McGruder President Director Director None
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
Gene L. Needles Vice President President President None
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
Terrie A. Wiedenheft Treasurer & Senior Vice Senior Vice Senior Vice
Controller President & Chief President & Chief President & Chief
Financial Officer Financial Officer Financial Officer
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
Brian E. Hirsch Vice President & Vice President & None None
Chief Compliance Chief Compliance
Officer Officer
- ------------------------------- ------------------- ------------------- --------------------- ---------------------
As administrator to the Fund, the Advisor received $323,591 in administration
fees for the fiscal year ended September 30, 2008. The underwriter of the Fund
received $0 in underwriting fees for the fiscal year ended September 30, 2008.
After the New Agreement is approved, the Advisor will continue to provide
administrative services to the Fund and the underwriter will continue to provide
underwriting services to the Fund.
11
PORTFOLIO TRANSACTIONS
There were no affiliated brokerage transactions for the Fund's most recently
completed fiscal year end.
SUBMISSION OF SHAREHOLDER PROPOSALS
The Trust is not generally required to hold annual or special meetings of
shareholders. Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent shareholders' meeting should send their written
proposals to the Secretary of the Trust at the address set forth on the cover of
this Proxy Statement. Proposals received by the Trust in a reasonable period of
time prior to that meeting will be included in the proxy statement.
OTHER BUSINESS
The Board knows of no other business to be brought before the Meeting. If other
business should properly come before the meeting, the proxy holders will vote
thereon in their discretion.
PLEASE COMPLETE THE ENLOSED PROXY CARD(S) AND RETURN THE CARD(S) PROMPTLY IN THE
ENCLOSED SELF-ADDRESSED, POSTAGE-PAID ENVELOPE.
By order of the Board of Trustees
/s/ Jay S. Fitton
Jay S. Fitton
Secretary
12
APPENDIX A
SUB-ADVISORY AGREEMENT
TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND
TOUCHSTONE FUNDS GROUP TRUST
This SUB-ADVISORY AGREEMENT is made as of February 27, 2009, by and
between TOUCHSTONE ADVISORS, INC., an Ohio corporation (the "Advisor"), and FORT
WASHINGTON INVESTMENT ADVISORS, INC., an Ohio corporation (the "Sub-Advisor").
WHEREAS, the Advisor is an investment advisor registered under the
Investment Advisers Act of 1940, as amended, and has been retained by Touchstone
Funds Group Trust (the "Trust"), a Delaware business trust organized pursuant to
an Agreement and Declaration of Trust dated October 25, 1993 (as amended) and
registered as an open-end diversified management investment company under the
Investment Company Act of 1940 (the "1940 Act"), to provide investment advisory
services with respect to certain assets of the Touchstone Ultra Short Duration
Fixed Income Fund (the "Fund"); and
WHEREAS, the Sub-Advisor also is an investment advisor registered under
the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Advisor desires to retain the Sub-Advisor to furnish it
with portfolio management services in connection with the Advisor's investment
advisory activities on behalf of the Fund, and the Sub-Advisor is willing to
furnish such services to the Advisor and the Fund;
NOW THEREFORE, in consideration of the terms and conditions hereinafter
set forth, it is agreed as follows:
1. EMPLOYMENT OF THE SUB-ADVISOR. In accordance with and subject to the
Investment Advisory Agreement between the Trust and the Advisor, attached hereto
as Exhibit A (the "Advisory Agreement"), the Advisor hereby appoints the
Sub-Advisor to manage the investment and reinvestment of that portion of the
assets of the Fund allocated to it by the Advisor (the "Fund Assets"), in
conformity with the Fund's currently effective Registration Statement,
prospectus and Statement of Additional Information and subject to the control
and direction of the Advisor and the Trust's Board of Trustees, for the period
and on the terms hereinafter set forth. The Sub-Advisor hereby accepts such
employment and agrees during such period to render the services and to perform
the duties called for by this Agreement for the compensation herein provided.
The Sub-Advisor shall at all times maintain its registration as an investment
advisor under the Investment Advisers Act of 1940 (the "Advisers Act") and shall
otherwise comply in all material respects with all applicable laws and
regulations, both state and federal. The Sub-Advisor shall for all purposes
herein be deemed an independent contractor and shall, except as expressly
provided or authorized (whether herein or otherwise), have no authority to act
for or represent the Trust in any way or otherwise be deemed an agent of the
Trust or the Fund.
2. DUTIES OF THE SUB-ADVISOR. The Sub-Advisor will provide the
following services and undertake the following duties:
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a. The Sub-Advisor will manage the investment and reinvestment
of the Fund Assets, subject to and in accordance with the investment
objectives, policies and restrictions of the Fund and in conformity
with the Fund's currently effective Registration Statement, prospectus
and Statement of Additional Information and any directions which the
Advisor or the Trust's Board of Trustees may give from time to time
with respect to the Fund. In furtherance of the foregoing, the
Sub-Advisor will make all determinations with respect to the investment
of the Fund Assets and the purchase and sale of portfolio securities
and shall take such steps as may be necessary or advisable to implement
the same. The Sub-Advisor also will determine the manner in which
voting rights, rights to consent to corporate action and any other
rights pertaining to the portfolio securities will be exercised. The
Sub-Advisor will render regular reports to the Trust's Board of
Trustees and to the Advisor (or such other advisor or advisors as the
Advisor shall engage to assist it in the evaluation of the performance
and activities of the Sub-Advisor). Such reports shall be made in such
form and manner and with respect to such matters regarding the Fund and
the Sub-Advisor as the Trust or the Advisor shall from time to time
request; provided, however, that in the absence of extraordinary
circumstances, the individual primarily responsible for management of
Fund Assets for the Sub-Advisor will not be required to attend in
person more than one meeting per year with the trustees of the Trust.
b. The Sub-Advisor shall immediately notify the Advisor if the
Sub-Advisor reasonably believes that the value of any security held by
the Fund may not reflect fair value. The Sub-Advisor agrees to provide
any pricing information of which the Sub-Advisor is aware to the
Advisor and/or any Fund pricing agent to assist in the determination of
the fair value of any Fund holdings for which market quotations are not
readily available or as otherwise required in accordance with the 1940
Act or the Fund's valuation procedures for the purpose of calculating
the Fund's net asset value in accordance with procedures and methods
established by the Board.
c. Regulatory Compliance.
(i) The Sub-Advisor agrees to comply with the
requirements of the 1940 Act, the Advisers Act, the 1933 Act, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the
Commodity Exchange Act and the respective rules and regulations
thereunder, as applicable, as well as with all other applicable federal
and state laws, rules, regulations and case law that relate to the
services and relationships described hereunder and to the conduct of
its business as a registered investment adviser. In selecting the
Fund's portfolio securities and performing the Sub-Adviser's
obligations hereunder, the Sub-Advisor shall cause the Fund to comply
with the diversification and source of income requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"), for qualification as a regulated investment company. The
Sub-Advisor shall maintain compliance procedures that it reasonably
believes are adequate to ensure the compliance with the foregoing. No
supervisory activity undertaken by the Advisor shall limit the
Sub-Advisor's full responsibility for any of the foregoing.
(ii) The Sub-Advisor has adopted a written code of
ethics that it reasonably believes complies with the requirements of
Rule 17j-1 under the 1940 Act, which it will provide to the Advisor and
the Fund. The Sub-Advisor shall ensure that its Access Persons (as
defined in the Sub-Advisor's Code of Ethics) comply in all material
respects with the Sub-Advisor's Code of Ethics, as in effect from time
to time. Upon request, the Sub-Advisor shall provide the Fund with (i)
a copy of the Sub-Advisor's current Code of Ethics, as in effect from
time to time, and (ii) a certification that it has adopted procedures
reasonably necessary to prevent Access Persons from engaging in any
conduct prohibited by the Sub-Advisor's Code of Ethics. No less
frequently than annually, the Sub-Advisor shall furnish a written
report, which complies with the requirements of Rule 17j-1, concerning
the Sub-Advisor's Code of Ethics to the Fund and the Advisor. The
Sub-Advisor shall respond to requests for information from the Advisor
as to violations of the Code by Access Persons and the sanctions
imposed by the Sub-Advisor. The Sub-Advisor shall immediately notify
the Advisor of any material violation of the Code, whether or not such
violation relates to a security held by any Fund.
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(iii) The Sub-Advisor shall notify the Trust's Chief
Compliance Officer and Advisor immediately upon detection of (i) any
material failure to manage any Fund in accordance with its investment
objectives and policies or any applicable law; or (ii) any material
breach of any of the Fund's or the Adviser's policies, guidelines or
procedures. In addition, the Sub-Advisor shall provide a quarterly
report regarding each Fund's compliance with its investment objectives
and policies and applicable law, including, but not limited to the 1940
Act, the Code, and the Fund's and the Advisor's policies, guidelines or
procedures as applicable to the Sub-Advisor's obligations under this
Agreement. The Sub-Advisor acknowledges and agrees that the Advisor
may, in its discretion, provide such quarterly compliance
certifications to the Board. The Sub-Advisor agrees to correct any such
failure promptly and to take any action that the Board and/or the
Advisor may reasonably request in connection with any such breach. The
Sub-Advisor shall also provide the officers of the Trust with
supporting certifications in connection with such certifications of
Fund financial statements and disclosure controls pursuant to the
Sarbanes-Oxley Act. The Sub-Advisor will promptly notify the Trust in
the event (i) the Sub-Advisor is served or otherwise receives notice of
any action, suit, proceeding, inquiry or investigation, at law or in
equity, before or by any court, public board, or body, involving the
affairs of the Trust (excluding class action suits in which a Fund is a
member of the plaintiff class by reason of the Fund's ownership of
shares in the defendant) or the compliance by the Sub-Advisor with the
federal or state securities laws or (ii) the controlling stockholder of
the Sub-Advisor changes or an actual change in control resulting in an
"assignment" (as defined in the 1940 Act) has occurred or is otherwise
proposed to occur.
(iv) The Sub-Advisor shall maintain separate books
and detailed records of all matters pertaining to the Fund's assets
advised by the Sub-Advisor required by Rule 31a-1 under the 1940 Act
(other than those records being maintained by the Advisor, custodian or
transfer agent appointed by the Fund) relating to its responsibilities
provided hereunder with respect to the Fund, and shall preserve such
records for the periods and in a manner prescribed therefore by Rule
31a-2 under the 1940 Act (the "Fund Books and Records" ). The Fund
Books and Records shall be available to the Advisor and the Board at
any time upon request shall be delivered to the Trust upon the
termination of this Agreement and shall be available for telecopying
without delay during any day the Fund is open for business.
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d. The Sub-Advisor shall provide support to the Advisor with
respect to the marketing of the Fund, including but not limited to: (i)
permission to use the Sub-Advisor's name as provided in Section 5, (ii)
permission to use the past performance and investment history of the
Sub-Advisor with respect to a composite of other funds managed by the
Sub-Advisor that are comparable, in investment objective and
composition, to the Fund, (iii) access to the individual(s) responsible
for day-to-day management of the Fund for marketing conferences,
teleconferences and other activities involving the promotion of the
Fund, subject to the reasonable request of the Advisor, (iv) permission
to use biographical and historical data of the Sub-Advisor and
individual manager(s), and (v) permission to use the names of those
clients pre-approved by the Sub-Advisor to which the Sub-Advisor
provides investment management services, subject to receipt of the
consent of such clients to the use of their names.
e. The Sub-Advisor will, in the name of the Fund, place orders
for the execution of all portfolio transactions in accordance with the
policies with respect thereto set forth in the Trust's registration
statements under the 1940 Act and the Securities Act of 1933, as such
registration statements may be in effect from time to time. When
placing orders with brokers and dealers, the Sub-Advisor's primary
objective shall be to obtain the most favorable price and execution
available for the Fund, and in placing such orders the Sub-Advisor may
consider a number of factors, including, without limitation, the
overall direct net economic result to the Fund (including commissions,
which may not be the lowest available but ordinarily should not be
higher than the generally prevailing competitive range), the financial
strength and stability of the broker, the efficiency with which the
transaction will be effected, the ability to effect the transaction at
all where a large block is involved and the availability of the broker
or dealer to stand ready to execute possibly difficult transactions in
the future. Consistent with the Conduct Rules of the National
Association of Securities Dealers, Inc., and subject to seeking most
favorable price and execution and compliance with Rule 12b-1(h) under
the 1940 Act, the Sub-Advisor may select brokers and dealers to execute
portfolio transactions of the Fund that promote or sell shares of the
Fund. The Sub-Advisor is specifically authorized, to the extent
authorized by law (including, without limitation, Section 28(e) of the
1934 Act,) to pay a broker or dealer who provides research services to
the Sub-Advisor an amount of commission for effecting a portfolio
transaction in excess of the amount of commission another broker or
dealer would have charged for effecting such transaction, in
recognition of such additional research services rendered by the broker
or dealer, but only if the Sub-Advisor determines in good faith that
the excess commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer
viewed in terms of the particular transaction or the Sub-Advisor's
overall responsibilities with respect to discretionary accounts that it
manages, and that the Fund derives or will derive a reasonable benefit
from such research services. The Sub-Advisor will present a written
report to the Board of Trustees of the Trust, at least quarterly,
indicating total brokerage expenses, actual or imputed, as well as the
services obtained in consideration for such expenses, broken down by
broker-dealer and containing such information as the Board of Trustees
reasonably shall request.
f. The Sub-Adviser shall maintain errors and omissions
insurance coverage in an appropriate amount and shall provide prior
written notice to the Trust (i) of any material changes in its
insurance policies or insurance coverage; or (ii) if any material
claims will be made on its insurance policies. Furthermore, the
Sub-Advisor shall, upon reasonable request, provide the Trust with any
information it may reasonably require concerning the amount of or scope
of such insurance.
A-4
g. In the event of any reorganization or other change in the
Sub-Advisor, its investment principals, supervisors or members of its
investment (or comparable) committee, the Sub-Advisor shall give the
Advisor and the Trust's Board of Trustees written notice of such
reorganization or change within a reasonable time (but not later than
30 days) after such reorganization or change.
h. The Sub-Advisor will bear its expenses of providing
services to the Fund pursuant to this Agreement except such expenses as
are expressly undertaken by the Advisor or the Trust.
3. COMPENSATION OF THE SUB-ADVISOR.
a. As compensation for the services to be rendered and duties
undertaken hereunder by the Sub-Advisor, the Advisor will pay to the
Sub-Advisor a monthly fee equal on an annual basis to 0.125% of average
daily net assets of the Fund without regard to any total expense
limitation of the Trust or the Advisor. Such fee shall be computed and
accrued daily. If the Sub-Advisor serves in such capacity for less than
the whole of any period specified in this Section 3a, the compensation
to the Sub-Advisor shall be prorated. For purposes of calculating the
Sub-Advisor's fee, the daily value of the Fund Assets shall be computed
by the same method as the Trust uses to compute the net asset value of
the Fund for purposes of purchases and redemptions of shares thereof.
b. The Sub-Advisor reserves the right to waive all or a part
of its fees hereunder.
4. ACTIVITIES OF THE SUB-ADVISOR. It is understood that the Sub-Advisor
may perform investment advisory services for various other clients, including
other investment companies. The Trust and the Advisor further acknowledge that
the Sub-Advisor may form or serve as an investment advisor or sub-advisor to
future funds, which have the same, similar, or overlapping investment
objectives. Provided, however that the Sub-Advisor represents and warrants that
it has no arrangement or understanding with any party, other than the Trust,
that would influence the decision of the Sub-Advisor with respect to its
selection of securities for the Fund, and that all selections shall be done in
accordance with what is in the best interest of the Fund in a manner consistent
with Sub-Advisor's fiduciary duty.
The Sub-Advisor will report to the Board of Trustees of the Trust (at
regular quarterly meetings and at such other times as such Board of Trustees
reasonably shall request, subject to the limitation on personal attendance at
such meetings set forth in Section 2a) (i) the financial condition and prospects
of the Sub-Advisor, (ii) the nature and amount of transactions affecting the
Fund that involve the Sub-Advisor and affiliates of the Sub-Advisor, (iii)
information regarding any potential conflicts of interest arising by reason of
its continuing provision of advisory services to the Fund and to its other
accounts, and (iv) such other information as the Board of Trustees shall
reasonably request regarding the Fund, the Fund's performance, the services
provided by the Sub-Advisor and affiliates of the Sub-Advisor to the Fund as
compared to its other accounts and the plans of, and the capability of, the
Sub-Advisor with respect to providing future services to the Fund and its other
accounts. The Sub-Advisor agrees to submit to the Trust a statement defining its
policies with respect to the allocation of business among the Fund and its other
clients.
A-5
The Sub-Advisor has supplied to the Advisor and the Trust copies of its
Form ADV with all exhibits and attachments thereto (including the Sub-Advisor's
statement of financial condition) and will hereafter supply to the Advisor,
promptly upon the preparation thereof, copies of all amendments or restatements
of such document.
5. USE OF NAMES. Neither the Advisor nor the Trust shall use the name
of the Sub-Advisor in any prospectus, sales literature or other material
relating to the Advisor or the Trust in any manner not approved in advance by
the Sub-Advisor; provided, however, that the Sub-Advisor will approve all uses
of its name which merely refer in accurate terms to its appointment hereunder or
which are required by the SEC or a state securities commission; and provided
further, that in no event shall such approval be unreasonably withheld. The
Sub-Advisor shall not use the name of the Advisor or the Trust in any material
relating to the Sub-Advisor in any manner not approved in advance by the Advisor
or the Trust, as the case may be; provided, however, that the Advisor and the
Trust shall each approve all uses of their respective names which merely refer
in accurate terms to the appointment of the Sub-Advisor hereunder or which are
required by the SEC or a state securities commission; and, provided further,
that in no event shall such approval be unreasonably withheld.
6. LIABILITY OF THE SUB-ADVISOR. The Sub-Advisor shall indemnify and
hold harmless the Trust and all affiliated persons thereof (within the meaning
of Section 2(a)(3) of the 1940 Act) and all controlling persons (as described in
Section 15 of the 1933 Act) (collectively, the "Sub-Advisor Indemnitees")
against any and all losses, claims, damages, liabilities or litigation
(including reasonable legal and other expenses) by reason of or arising out of:
(a) the Sub-Advisor being in material violation of any applicable federal or
state law, rule or regulation or any investment policy or restriction set forth
in the Funds' Registration Statement or any written guidelines or instruction
provided in writing by the Board, or (b) the Sub-Advisor's willful misfeasance,
bad faith or gross negligence generally in the performance of its duties
hereunder or its reckless disregard of its obligations and duties under this
Agreement. As used in this Section 6, the term "Sub-Advisor" shall include the
Sub-Advisor and/or any of its affiliates and the directors, officers and
employees of the Sub-Advisor and/or any of its affiliates.
7. LIMITATION OF TRUST'S LIABILITY. The Sub-Advisor acknowledges that
it has received notice of and accepts the limitations upon the Trust's liability
set forth in its Declaration of Trust. The Sub-Advisor agrees that (i) the
Trust's obligations to the Sub-Advisor under this Agreement (or indirectly under
the Advisory Agreement) shall be limited in any event to the Fund Assets and
(ii) the Sub-Advisor shall not seek satisfaction of any such obligation from the
holders of shares of the Fund, other than the Advisor, nor from any Trustee,
officer, employee or agent of the Trust.
8. FORCE MAJEURE. The Sub-Advisor shall not be liable for delays or
errors occurring by reason of circumstances beyond its control, including but
not limited to acts of civil or military authority, national emergencies, work
stoppages, fire, flood, catastrophe, acts of God, insurrection, war, riot, or
failure of communication or power supply. In the event of equipment breakdowns
beyond its control, the Sub-Advisor shall take all reasonable steps to minimize
service interruptions but shall have no liability with respect thereto.
A-6
9. RENEWAL, TERMINATION AND AMENDMENT.
a. This Agreement shall continue in effect, unless sooner
terminated as hereinafter provided, until February 27, 2011; and it shall
continue thereafter provided that such continuance is specifically approved
by the parties and, in addition, at least annually by (i) the vote of the
holders of a majority of the outstanding voting securities (as herein
defined) of the Fund or by vote of a majority of the Trust's Board of
Trustees and (ii) by the vote of a majority of the Trustees who are not
parties to this Agreement or interested persons of either the Advisor or
the Sub-Advisor, cast in person at a meeting called for the purpose of
voting on such approval.
b. This Agreement may be terminated at any time, without
payment of any penalty, (i) by the Advisor upon not more than sixty
(60) days' nor less than thirty (30) days' written notice delivered or
mailed by registered mail, postage prepaid, to the Sub-Advisor; (ii) by
the Sub-Advisor upon not less than sixty (60) days' written notice
delivered or mailed by registered mail, postage prepaid, to the
Advisor; or (iii) by the Trust upon either (y) the majority vote of its
Board or (z) the affirmative vote of a majority of the outstanding
voting securities of the Fund. This Agreement shall terminate
automatically in the event of its assignment.
c. This Agreement may be amended at any time by the parties
hereto, subject to approval by the Trust's Board of Trustees and, if
required by applicable SEC rules and regulations, a vote of the
majority of the outstanding voting securities of the Fund affected by
such change.
d. The terms "assignment," "interested persons" and "majority
of the outstanding voting securities" shall have the meaning set forth
for such terms in the 1940 Act.
10. SEVERABILITY. If any provision of this Agreement shall become or
shall be found to be invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby.
11. NOTICE. Any notices under this Agreement shall be in writing
addressed and delivered personally (or by telecopy) or mailed postage-paid, to
the other party at such address as such other party may designate in accordance
with this paragraph for the receipt of such notice. Until further notice to the
other party, it is agreed that the address of the Trust and that of the Advisor
for this purpose shall be 303 Broadway, Suite 1100, Cincinnati, Ohio 45202 and
that the address of the Sub-Advisor shall be 303 Broadway, Suite 1200,
Cincinnati, Ohio 45202.
12. MISCELLANEOUS. Each party agrees to perform such further actions
and execute such further documents as are necessary to effectuate the purposes
hereof. This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Ohio and the Sub-Advisor consents to the
jurisdiction of courts, both state or federal, in Ohio, with respect to any
dispute under this Agreement. The captions in this Agreement are included for
convenience only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
A-7
THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK
A-8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered in their names and on their behalf by the undersigned, thereunto
duly authorized, all as of the day and year first above written.
TOUCHSTONE ADVISORS, INC.
Attest:
By:
- -------------------------------------- -----------------------------
Gene Needles
Name: President
---------------------------------
Title:
--------------------------------
FORT WASHINGTON INVESTMENT
ADVISORS, INC.
Attest:
By:
- -------------------------------------- -----------------------------
Name: Name:
--------------------------------- -----------------------------
Title: Title:
-------------------------------- -----------------------------
A-9
PROXY TABULATOR
P.O. BOX 9112
FARMINGDALE, NY 11735
EVERY SHAREHOLDER'S VOTE IS IMPORTANT! PLEASE SIGN, DATE AND RETURN YOUR VOTING
INSTRUCTIONS TODAY!
Your Proxy Vote is important! Now you can Vote your Proxy on the PHONE or on the
INTERNET. Just follow these simple steps:
TO VOTE BY INTERNET
1) Read the Proxy Statement and have the proxy card below at hand.
2) Go to website WWW.PROXYVOTE.COM
3) Follow the instructions provided on the website.
TO VOTE BY TELEPHONE
1) Read the Proxy Statement and have the proxy card below at hand.
2) Call 1-800-690-6903
3) Follow the instructions.
TO VOTE BY MAIL
1) Read the Proxy Statement.
2) Check the appropriate boxes on the proxy card below.
3) Sign and date the proxy card.
4) Return the proxy card in the envelope provided.
------------------
-> 999 999 999 999 99
------------------
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS
- --------------------------------------------------------------------------------
DETACH AND RETURN THIS PORTION ONLY
THIS CARD IS VALID ONLY WHEN SIGNED AND DATED.
- --------------------------------------------------------------------------------
TOUCHSTONE ULTRA SHORT DURATION FIXED INCOME FUND
EVERY SHAREHOLDER'S VOTE IS IMPORTANT!
VOTE THIS PROXY CARD TODAY!
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING PROPOSAL.
FOR AGAINST ABSTAIN
1. To approve a new investment sub-advisory agreement [_] [_] [_]
Note: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. When signing
as attorney, executor, administrator, trustee, guardian or as custodian for a
minor, please sign your name and give your full title as such. If signing on
behalf of a corporation please sign the full corporate name and your name and
indicate your title. If you are a partner signing for a partnership, please sign
the partnership name, your name and indicate your title. Joint owners should
each sign these instructions. Please sign, date and return.
PLEASE SIGN, DATE, AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE
- --------------------------------------- ----------------------------------
- --------------------------------------- ----------------------------------
Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PROXY PROXY
TOUCHSTONE FUNDS GROUP TRUST
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
FEBRUARY 20, 2009
The undersigned shareholder(s) of the Touchstone Ultra Short Duration Fixed
Income Fund (the "Fund") of the Touchstone Funds Group Trust (the "Trust")
hereby appoints Jay Fitton and Frank 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 Fund to be held on February 20, 2009, at 303 Broadway, Suite 1100,
Cincinnati, Ohio 45202, at 10:00 a.m. local time, and at any adjournment thereof
as indicated on the reverse side. In its discretion, the Fund is authorized to
vote upon such other matters as may properly come before the meeting.
RECEIPT OF THE NOTICE OF THE SPECIAL MEETING AND THE ACCOMPANYING PROXY
STATEMENT, AS APPLICABLE, IS HEREBY ACKNOWLEDGED. THE SHARES REPRESENTED HEREBY
WILL BE VOTED AS INDICATED OR FOR THE PROPOSAL IF NO CHOICE IS INDICATED.
IMPORTANT: PLEASE SIGN AND DATE ON THE REVERSE SIDE BEFORE MAILING