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:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
METROPOLITAN SERIES FUND, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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METROPOLITAN SERIES FUND, INC.
501 BOYLSTON STREET, BOSTON, MASSACHUSETTS 02116
Dear Policy Holder:
We are writing to inform you that Metropolitan Series Fund, Inc. (the
"Fund") will hold a special meeting of shareholders of the Fund, which consists
of 37 portfolios (the "Portfolios"), on April 28, 2006 at 2:00 p.m. Eastern
Time at the offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston
Street, Boston, Massachusetts 02116.
As discussed in more detail in the enclosed Proxy Statement, you will be
asked to approve the following proposals:
. Election of nine Directors of the Fund. Eight nominees are currently
Directors of the Fund.
. If you are entitled to give voting instructions with respect to shares of
the MFS Total Return Portfolio, approval of an amendment to the Advisory
Agreement between the Fund, with respect to that Portfolio, and the Manager.
. If you are entitled to give voting instructions with respect to certain
Portfolios, approval of the elimination of or changes to certain fundamental
investment restrictions with respect to certain Portfolios in order to,
among other things, adopt more standardized investment restrictions across
the Portfolios and to eliminate redundant or burdensome restrictions.
A formal Notice of Special Meeting of Shareholders is enclosed, followed by
a proxy statement relating to the proposals (the "Proxy Statement"). Please
review the enclosed Proxy Statement for a more detailed description of the
proposals.
As an owner of a variable life insurance or variable annuity contract issued
by separate accounts of the insurance companies in the MetLife enterprise
(each, an "Insurance Company"), you have the right to instruct your Insurance
Company how to vote at the meeting on the relevant proposals. You may give
voting instructions for the number of shares of the relevant Portfolios
attributable to your life insurance policy or annuity contract as of the record
time of the close of business on February 17, 2006.
YOUR VOTE IS IMPORTANT. PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED
VOTING INSTRUCTIONS FORM PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE WHETHER
OR NOT YOU PLAN TO BE PRESENT AT THE MEETING. YOU CAN ALSO VOTE BY PHONE OR
ELECTRONICALLY BY FOLLOWING THE SIMPLE INSTRUCTIONS THAT APPEAR ON THE ENCLOSED
INSTRUCTION SLIP. YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING.
THE DIRECTORS RECOMMEND THAT YOU VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE
ENTITLED TO GIVE INSTRUCTIONS.
Please take a few moments to review the details of the proposals. If you
have any questions regarding the proposals, please feel free to call the
contact number listed in the enclosed Proxy Statement. We urge you to vote at
your earliest convenience.
We appreciate your participation in and prompt response to these matters and
thank you for your continued support.
Very truly yours,
- -------------------------
Hugh C. McHaffie,
President
[ ], 2006
METROPOLITAN SERIES FUND, INC.
501 BOYLSTON STREET, BOSTON, MASSACHUSETTS 02116
BLACKROCK AGGRESSIVE GROWTH PORTFOLIO METLIFE CONSERVATIVE ALLOCATION
BLACKROCK BOND INCOME PORTFOLIO PORTFOLIO
BLACKROCK DIVERSIFIED PORTFOLIO METLIFE CONSERVATIVE TO MODERATE
BLACKROCK INVESTMENT TRUST PORTFOLIO ALLOCATION PORTFOLIO
BLACKROCK LARGE CAP VALUE PORTFOLIO METLIFE MID CAP STOCK INDEX PORTFOLIO
BLACKROCK LEGACY LARGE CAP GROWTH METLIFE MODERATE ALLOCATION PORTFOLIO
PORTFOLIO METLIFE MODERATE TO AGGRESSIVE
BLACKROCK MONEY MARKET PORTFOLIO ALLOCATION PORTFOLIO
BLACKROCK STRATEGIC VALUE PORTFOLIO METLIFE STOCK INDEX PORTFOLIO
CAPITAL GUARDIAN U.S. EQUITY PORTFOLIO MFS INVESTORS TRUST PORTFOLIO
DAVIS VENTURE VALUE PORTFOLIO MFS TOTAL RETURN PORTFOLIO
FI INTERNATIONAL STOCK PORTFOLIO MORGAN STANLEY EAFE INDEX PORTFOLIO
FI MID CAP OPPORTUNITIES PORTFOLIO NEUBERGER BERMAN MID CAP VALUE
FI VALUE LEADERS PORTFOLIO PORTFOLIO
FRANKLIN TEMPLETON SMALL CAP GROWTH RUSSELL 2000 INDEX PORTFOLIO
PORTFOLIO SALOMON BROTHERS STRATEGIC BOND
HARRIS OAKMARK FOCUSED VALUE PORTFOLIO OPPORTUNITIES PORTFOLIO
HARRIS OAKMARK LARGE CAP VALUE SALOMON BROTHERS U.S. GOVERNMENT
PORTFOLIO PORTFOLIO
JENNISON GROWTH PORTFOLIO OPPENHEIMER GLOBAL EQUITY PORTFOLIO
LEHMAN BROTHERS AGGREGATE BOND INDEX T. ROWE PRICE LARGE CAP GROWTH
PORTFOLIO PORTFOLIO
LOOMIS SAYLES SMALL CAP PORTFOLIO T. ROWE PRICE SMALL CAP GROWTH
METLIFE AGGRESSIVE ALLOCATION PORTFOLIO
PORTFOLIO ZENITH EQUITY PORTFOLIO
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
April 28, 2006
Notice is hereby given that a Special Meeting (the "Meeting") of the
shareholders (the "Shareholders") of Metropolitan Series Fund, Inc. (the
"Fund") will be held at 2:00 p.m. Eastern Time on April, 28 2006, at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116 for the following purposes:
1. To elect the members of the Board of Directors of the Fund.
2. To approve, for the MFS Total Return Portfolio ("MFS Total Return"),
an amendment to the Advisory Agreement between the Fund, on behalf of
MFS Total Return, and the Manager.
3. To approve, for the BlackRock Aggressive Growth Portfolio, BlackRock
Diversified Portfolio, BlackRock Investment Trust Portfolio, BlackRock
Large Cap Value Portfolio, BlackRock Strategic Value Portfolio, FI
International Stock Portfolio, FI Mid Cap Opportunities Portfolio,
Franklin Templeton Small Cap Growth Portfolio, Harris Oakmark Large
Cap Value Portfolio, Lehman Brothers Aggregate Bond Index Portfolio,
MetLife Mid Cap Stock Index Portfolio, MetLife Stock Index Portfolio,
Morgan Stanley EAFE Index Portfolio, Neuberger Berman Mid Cap Value
Portfolio, Oppenheimer Global Equity Portfolio, Russell 2000 Index
Portfolio, T. Rowe Price Large Cap Growth Portfolio and T. Rowe Price
Small Cap Growth Portfolio, the elimination of or changes to certain
fundamental investment restrictions.
4. To consider and act upon any other matters which may properly come
before the Meeting and any adjournment thereof.
Shareholders of record as of the close of business on February 17, 2006 are
entitled to notice of and to vote at the Meeting and any adjournment thereof.
By order of the Board of
Directors of the Fund,
-----------------------------
Thomas M. Lenz, Secretary
[ ], 2006
YOUR VOTE IS IMPORTANT
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED VOTING INSTRUCTIONS FORM
PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE WHETHER OR NOT YOU PLAN TO BE
PRESENT AT THE MEETING. YOU CAN ALSO VOTE BY PHONE OR ELECTRONICALLY BY
FOLLOWING THE SIMPLE INSTRUCTIONS THAT APPEAR ON THE ENCLOSED INSTRUCTION SLIP.
YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING.
METROPOLITAN SERIES FUND, INC.
501 Boylston Street
Boston, Massachusetts 02116
BLACKROCK AGGRESSIVE GROWTH PORTFOLIO METLIFE CONSERVATIVE ALLOCATION
BLACKROCK BOND INCOME PORTFOLIO PORTFOLIO
BLACKROCK DIVERSIFIED PORTFOLIO METLIFE CONSERVATIVE TO MODERATE
BLACKROCK INVESTMENT TRUST PORTFOLIO ALLOCATION PORTFOLIO
BLACKROCK LARGE CAP VALUE PORTFOLIO METLIFE MID CAP STOCK INDEX PORTFOLIO
BLACKROCK LEGACY LARGE CAP GROWTH METLIFE MODERATE ALLOCATION PORTFOLIO
PORTFOLIO METLIFE MODERATE TO AGGRESSIVE
BLACKROCK MONEY MARKET PORTFOLIO ALLOCATION PORTFOLIO
BLACKROCK STRATEGIC VALUE PORTFOLIO METLIFE STOCK INDEX PORTFOLIO
CAPITAL GUARDIAN U.S. EQUITY PORTFOLIO MFS INVESTORS TRUST PORTFOLIO
DAVIS VENTURE VALUE PORTFOLIO MFS TOTAL RETURN PORTFOLIO
FI INTERNATIONAL STOCK PORTFOLIO MORGAN STANLEY EAFE INDEX PORTFOLIO
FI MID CAP OPPORTUNITIES PORTFOLIO NEUBERGER BERMAN MID CAP VALUE
FI VALUE LEADERS PORTFOLIO PORTFOLIO
FRANKLIN TEMPLETON SMALL CAP GROWTH RUSSELL 2000 INDEX PORTFOLIO
PORTFOLIO SALOMON BROTHERS STRATEGIC BOND
HARRIS OAKMARK FOCUSED VALUE PORTFOLIO OPPORTUNITIES PORTFOLIO
HARRIS OAKMARK LARGE CAP VALUE SALOMON BROTHERS U.S. GOVERNMENT
PORTFOLIO PORTFOLIO
JENNISON GROWTH PORTFOLIO OPPENHEIMER GLOBAL EQUITY PORTFOLIO
LEHMAN BROTHERS AGGREGATE BOND INDEX T. ROWE PRICE LARGE CAP GROWTH
PORTFOLIO PORTFOLIO
LOOMIS SAYLES SMALL CAP PORTFOLIO T. ROWE PRICE SMALL CAP GROWTH
METLIFE AGGRESSIVE ALLOCATION PORTFOLIO
PORTFOLIO ZENITH EQUITY PORTFOLIO
PROXY STATEMENT
This Proxy Statement is being furnished in connection with the solicitation
of voting instructions by the Board of Directors (the "Board of Directors" or
the "Directors") of Metropolitan Series Fund, Inc. (the "Fund") for use at a
special meeting (the "Meeting") of shareholders of the portfolios of the Fund
(each, a "Portfolio," and, collectively, the "Portfolios"). The Meeting will be
held at 2:00 p.m. Eastern Time on April 28, 2006, at the offices of MetLife
Advisers, LLC (the "Manager"), 501 Boylston Street, Boston, Massachusetts
02116. This Proxy Statement and its enclosures are being mailed to shareholders
beginning on or about [ ], 2006. Shareholders of record as of the
close of business on February 17, 2006 (the "Record Date") are entitled to vote
on the proposals, as set forth below.
The Meeting is being called for the following purposes: (1) to elect
Directors of the Fund, (2) to approve an amendment to the Advisory Agreement
between the Fund, with respect to the MFS Total Return Portfolio ("MFS Total
Return"), and the Manager (the "Advisory Agreement"), (3) to approve the
elimination of or change to certain fundamental investment restrictions for
certain Portfolios and (4) to transact such other business as may properly come
before the Meeting or any postponement or adjournment thereof.
Section I of this Proxy Statement contains information relating to the
proposal to elect Directors of the Fund. Section II contains information
relating to the proposal to approve an amendment to the Advisory Agreement.
Section III contains information
1
relating to the proposal to eliminate or change certain fundamental investment
restrictions for certain Portfolios. Section IV contains additional background
information about the Fund, the Manager and other matters. Section V contains
general information about the Meeting and shareholder voting.
The Fund, an open-end management investment company, is a Maryland
corporation that was formed in 1982. The Fund is a series-type company that has
37 Portfolios. The shares of the Portfolios are currently sold only to separate
accounts established by Metropolitan Life Insurance Company ("MetLife") and its
insurance company affiliates (together with MetLife, each, an "Insurance
Company," and, collectively, the "Insurance Companies"). Most of the shares of
the Portfolios are attributable to variable life insurance or variable annuity
contracts (each, a "Contract," and, collectively, "Contracts," owned by
"Contract Owners") issued by the Insurance Companies. As explained more fully
below, you may give voting instructions for the number of shares of each
Portfolio attributable to your Contract(s). The following table identifies each
of the proposals (each, a "Proposal" and, collectively, the "Proposals") to be
voted on at the Meeting and indicates the Portfolios as to which voting
instructions are being solicited for each Proposal. Not all of the Proposals
relate to all of the Portfolios. Each Contract Owner can give voting
instructions only on Proposals that relate to Portfolios that he or she is
actually using with his or her Contract(s).
2
SUMMARY OF PROPOSALS AND PORTFOLIOS AFFECTED*
II. PROPOSAL TO
APPROVE AN
AMENDMENT TO
THE ADVISORY III-B. PROPOSAL
AGREEMENT III-A. PROPOSAL TO REVISE
BETWEEN THE TO REVISE FUNDAMENTAL
FUND, ON FUNDAMENTAL INVESTMENT
BEHALF OF MFS INVESTMENT RESTRICTION
I. PROPOSAL TO TOTAL RETURN, RESTRICTIONS RELATING TO
ELECT A BOARD AND THE RELATING TO UNDERWRITING
NAME OF FUND OF DIRECTORS MANAGER BORROWING OF SECURITIES
- --------------------------------------------- -------------- --------------- --------------- ---------------
BlackRock Aggressive Growth.................. X X X
BlackRock Bond Income........................ X
BlackRock Diversified........................ X X X
BlackRock Investment Trust................... X X X
BlackRock Large Cap Value.................... X X X
BlackRock Legacy Large Cap Growth............ X
BlackRock Money Market....................... X
BlackRock Strategic Value.................... X X X
Capital Guardian U.S. Equity................. X
Davis Venture Value.......................... X
FI International Stock....................... X X X
FI Mid Cap Opportunities..................... X X X
FI Value Leaders............................. X
Franklin Templeton Small Cap Growth.......... X X X
Harris Oakmark Focuses Value................. X
Harris Oakmark Large Cap Value............... X X X
Jennison Growth.............................. X
Lehman Brothers Aggregate Bond Index......... X X X
Loomis Sayles Small Cap...................... X
MetLife Aggressive Allocation................ X
MetLife Conservative Allocation.............. X
MetLife Conservative to Moderate Allocation.. X
MetLife Mid Cap Stock Index.................. X X X
MetLife Moderate Allocation.................. X
MetLife Moderate to Aggressive Allocation.... X
MetLife Stock Index.......................... X X X
MFS Investors Trust.......................... X
Morgan Stanley EAFE Index.................... X X X
MSF Total Return............................. X X
Neuberger Berman Mid Cap Value............... X X X
Oppenheimer Global Equity.................... X X X
Russell 2000 Index........................... X X X
Salomon Brothers Strategic Bond Opportunities X
Salomon Brothers U.S. Government............. X
T. Rowe Price Large Cap Growth............... X X X
T. Rowe Price Small Cap Growth............... X X X
Zenith Equity................................ X
- --------
* An "X" denotes that the Portfolio is affected by the Proposal and that the
Portfolio's shareholders are being solicited to vote with respect to that
Proposal.
3
SUMMARY OF PROPOSALS AND PORTFOLIOS AFFECTED - (CONTINUED)*
III-C. PROPOSAL
TO REVISE
FUNDAMENTAL III-D. PROPOSAL III-E. PROPOSAL III-F. PROPOSAL
INVESTMENT TO ELIMINATE TO REVISE TO REVISE
RESTRICTIONS FUNDAMENTAL FUNDAMENTAL FUNDAMENTAL
RELATING TO INVESTMENT INVESTMENT INVESTMENT
ISSUANCE OF RESTRICTIONS RESTRICTIONS RESTRICTIONS
SENIOR RELATING TO RELATING TO RELATING TO
NAME OF FUND SECURITIES OPTIONS MAKING LOANS REAL ESTATE
- --------------------------------------------- --------------- --------------- --------------- ---------------
BlackRock Aggressive Growth.................. X X X X
BlackRock Bond Income........................
BlackRock Diversified........................ X X X X
BlackRock Investment Trust................... X X X X
BlackRock Large Cap Value.................... X X X X
BlackRock Legacy Large Cap Growth............
BlackRock Money Market.......................
BlackRock Strategic Value.................... X X X X
Capital Guardian U.S. Equity.................
Davis Venture Value..........................
FI International Stock....................... X X X X
FI Mid Cap Opportunities..................... X X X X
FI Value Leaders.............................
Franklin Templeton Small Cap Growth.......... X X X X
Harris Oakmark Focuses Value.................
Harris Oakmark Large Cap Value............... X X X X
Jennison Growth..............................
Lehman Brothers Aggregate Bond Index......... X X X X
Loomis Sayles Small Cap......................
MetLife Aggressive Allocation................
MetLife Conservative Allocation..............
MetLife Conservative to Moderate Allocation..
MetLife Mid Cap Stock Index.................. X X X X
MetLife Moderate Allocation..................
MetLife Moderate to Aggressive Allocation....
MetLife Stock Index.......................... X X X X
MFS Investors Trust..........................
Morgan Stanley EAFE Index.................... X X X X
MSF Total Return.............................
Neuberger Berman Mid Cap Value............... X X X X
Oppenheimer Global Equity.................... X X X X
Russell 2000 Index........................... X X X X
Salomon Brothers Strategic Bond Opportunities
Salomon Brothers U.S. Government.............
T. Rowe Price Large Cap Growth............... X X X X
T. Rowe Price Small Cap Growth............... X X X X
Zenith Equity................................
- --------
* An "X" denotes that the Portfolio is affected by the Proposal and that the
Portfolio's shareholders are being solicited to vote with respect to that
Proposal.
4
SUMMARY OF PROPOSALS AND PORTFOLIOS AFFECTED - (CONTINUED)*
III-G. PROPOSAL III-H. PROPOSAL
TO REVISE TO ELIMINATE III-I. PROPOSAL
FUNDAMENTAL FUNDAMENTAL TO REVISE
INVESTMENT INVESTMENT FUNDAMENTAL
RESTRICTIONS RESTRICTIONS INVESTMENT
RELATING TO RELATING TO RESTRICTIONS
INDUSTRY FOREIGN RELATING TO
NAME OF FUND CONCENTRATION SECURITIES COMMODITIES
- --------------------------------------------- --------------- --------------- ---------------
BlackRock Aggressive Growth.................. X X X
BlackRock Bond Income........................
BlackRock Diversified........................ X X X
BlackRock Investment Trust................... X X X
BlackRock Large Cap Value.................... X X
BlackRock Legacy Large Cap Growth............
BlackRock Money Market.......................
BlackRock Strategic Value.................... X X
Capital Guardian U.S. Equity.................
Davis Venture Value..........................
FI International Stock....................... X X
FI Mid Cap Opportunities..................... X X X
FI Value Leaders.............................
Franklin Templeton Small Cap Growth.......... X X X
Harris Oakmark Focuses Value.................
Harris Oakmark Large Cap Value............... X X X
Jennison Growth..............................
Lehman Brothers Aggregate Bond Index......... X X
Loomis Sayles Small Cap......................
MetLife Aggressive Allocation................
MetLife Conservative Allocation..............
MetLife Conservative to Moderate Allocation..
MetLife Mid Cap Stock Index.................. X X X
MetLife Moderate Allocation..................
MetLife Moderate to Aggressive Allocation....
MetLife Stock Index.......................... X X X
MFS Investors Trust..........................
Morgan Stanley EAFE Index.................... X X
MSF Total Return.............................
Neuberger Berman Mid Cap Value............... X X X
Oppenheimer Global Equity.................... X X
Russell 2000 Index........................... X X X
Salomon Brothers Strategic Bond Opportunities
Salomon Brothers U.S. Government.............
T. Rowe Price Large Cap Growth............... X X X
T. Rowe Price Small Cap Growth............... X X X
Zenith Equity................................
- --------
* An "X" denotes that the Portfolio is affected by the Proposal and that the
Portfolio's shareholders are being solicited to vote with respect to that
Proposal.
5
I: ELECTION OF A BOARD OF DIRECTORS
The Fund's Board of Directors proposes (i) that the following current
Directors be re-elected as Directors of the Fund: Hugh C. McHaffie, Arthur G.
Typermass, Steven A. Garban, Linda B. Strumpf, Michael S. Scott Morton, H.
Jesse Arnelle, Nancy Hawthorne and John T. Ludes; and (ii) that the following
new non-"interested person" (as defined in Section 2(a)(19) of the Investment
Company Act of 1940, as amended (the "1940 Act")) be elected as Director of the
Fund: Frances M. Hawk (together with the individuals named in (i), each, a
"Nominee," and collectively, the "Nominees"); such elections to be effective
May 1, 2006.
The Nominating Committee of the Fund, which is composed entirely of
Directors who are not "interested persons" of the Fund (the "Independent
Directors"), met to consider additional candidates to serve as Independent
Directors of the Fund. The Nominating Committee recommended Frances M. Hawk for
a position as an Independent Director and recommended to the Board that her
nomination be submitted to the Fund's shareholders for approval. The Board is
proposing that shareholders of the Fund elect Ms. Hawk as an Independent
Director and that they re-elect each of the current Directors.
The Board of Directors is currently composed of eight Directors, six of whom
are Independent Directors. Effective February 1, 2006, the Board has fixed the
number of Directors at nine. If all of the Nominees are approved by
shareholders, the Board will consist of nine Directors, two of whom will be
"interested persons" of the Fund (the "Interested Directors") and seven of whom
will be Independent Directors.
Information about Nominees
__________________________
Information about the Nominees is presented below. The information is listed
separately for (i) Nominees who will be Interested Directors and (ii) Nominees
who will be Independent Directors. Except as shown, each Nominee's principal
occupation and business experience for the last five years have been with the
employers(s) indicated, although in some cases the Nominee may have held
different positions with such employer(s).
6
INTERESTED DIRECTORS
NUMBER OF
PORTFOLIOS IN
FUND
COMPLEX
OVERSEEN OR
WOULD BE
POSITIONS LENGTH OVERSEEN BY OTHER DIRECTORSHIPS HELD BY
HELD WITH OF TIME PRINCIPAL OCCUPATION(S) DURING NOMINEE IF DIRECTOR OR NOMINEE FOR
NAME, ADDRESS, AND AGE FUND SERVED PAST 5 YEARS /(1)/ ELECTED /(3)/ DIRECTOR /(2)/
- ---------------------- --------- ------- ---------------------------------- ------------- ----------------------------------
Hugh C. McHaffie^ Director, 3 years Senior Vice President (since 42 Chairman of the Board (since 2004)
Metropolitan Life Chairman 2000), MetLife and MetLife Group, and Director (since 2003),
Insurance Company of the Inc. (since 2003); Manager, Chair Enterprise General Insurance
501 Boylston Street Board, of the Board of Managers, Agency, Inc.; Director (since
Boston, MA 02116 President President and Chief Executive 2002) and Executive Vice President
Age: 46 and Chief Officer (since 2003), the Manager; (since 2003), First MetLife
Executive Senior Vice President (since Investors Insurance Company,
Officer 2005), The Travelers Insurance MetLife Investors Insurance
Company, The Travelers Life and Company, MetLife Investors
Annuity Company, Citicorp Life Insurance Company of California
Insurance Company and First and MetLife Investors; Director
Citicorp Life Insurance Company; (since 2004) and Senior Vice
formerly, Senior Vice President, President (since 1999), New
New England Zenith Fund ("Zenith England Life Insurance Company
Fund")**. ("NELICO"); Director, Cova
Corporation (since 2000), General
American (since 2004), Omega
Reinsurance Corporation (since
2003); Director (since 2005),
Travelers Asset Management
International Company LLC and
Travelers Investment Adviser,
Inc.; Director and Chairman (since
2005), CitiStreet Funds, Inc.;
Director and President (since
2005), CitiStreet Funds Management
LLC.
Arthur G. Typermass^ Director 8 years Formerly, Senior Vice-President 38 None
43 Chestnut Street and Treasurer, MetLife.
Garden City, NY 11530
Age: 67
7
NON-INTERESTED DIRECTORS
NUMBER OF
PORTFOLIOS IN
FUND
COMPLEX
OVERSEEN OR
WOULD BE
POSITIONS LENGTH OVERSEEN BY OTHER DIRECTORSHIPS HELD BY
HELD WITH OF TIME PRINCIPAL OCCUPATION(S) DURING NOMINEE IF DIRECTOR OR NOMINEE FOR
NAME, ADDRESS, AND AGE FUND SERVED PAST 5 YEARS /(1)/ ELECTED /(3)/ DIRECTOR /(2)/
- ---------------------- --------- -------- ---------------------------------- ------------- ----------------------------------
Steve A. Garban+ Director 13 years Formerly, Chief Financial Officer, 38 None.
226 Harris Drive Senior Vice President Finance and
State College, PA Operations and Treasurer
16801 (Emeritus), The Pennsylvania State
Age: 67 University.
Linda B. Strumpf Director 6 years Vice President and Chief 38 None.
Ford Foundation Investment Officer, Ford
320 E. 43rd Street Foundation.
New York, NY 10017
Age: 57
Michael S. Scott Director 13 years Jay W. Forrester Professor of 38 None.
Morton+ Management (Emeritus), Sloan
Massachusetts School of Management, MIT.
Institute of
Technology ("MIT")
50 Memorial Drive
Cambridge, MA 02138
Age: 67
H. Jesse Arnelle Director 5 years Counsel, Womble Carlyle Sandrie & 38 Director, Textron Inc. (global
400 Urbano Drive Rice; formerly, Director, Gannet multi-industry company)*;
San Francisco, CA Co. Inc. (diversified news and Director, Armstrong Holdings Inc.
94127 information company)*; formerly, (parent company of floor and
Age: 71 Director, Eastman Chemical Company ceiling products business)*;
(global chemical company)*; Director, FPL Group Inc. (public
formerly, Director, Waste utility holding company)*;
Management, Inc.*; formerly, Director, URS Corporation
Director, Wells Fargo Bank & Co., (engineering design services
Inc. (financial services); firm)*.
formerly, Director, Union Pacific
Resources (oil and gas exploration
company)*.
Nancy Hawthorne Director 3 years Formerly, Board of Advisors, L. 38 Director and Chairman of the
60 Hyslop Road Knife & Sons, Inc. (beverage Board, Avid Technologies (computer
Brookline, MA 02445 distributor); Chief Executive software company)*.
Age: 54 Officer, Clerestory LLC (corporate
financial advisor); formerly,
Trustee, Zenith Fund**; formerly,
Chief Executive Officer and
Managing Partner, Hawthorne,
Krauss and Associates (corporate
financial advisor); formerly,
Chief Financial Officer and
Executive Vice President,
Continental Cablevision,
subsequently renamed MediaOne
(cable television company);
formerly, Director, Life F/X,
Inc.; formerly, Chairman of the
Board, WorldClinic (distance
medicine company); formerly,
Director, Perini Corporation
(construction)*; formerly,
Director, CGU (property and
casualty insurance company);
formerly, Director, Beacon Power
Corporation (energy)*.
8
NUMBER OF
PORTFOLIOS IN
FUND
COMPLEX
OVERSEEN OR
WOULD BE
POSITIONS LENGTH OVERSEEN BY OTHER DIRECTORSHIPS HELD BY
HELD WITH OF TIME PRINCIPAL OCCUPATION(S) DURING NOMINEE IF DIRECTOR OR NOMINEE FOR DIRECTOR
NAME, ADDRESS, AND AGE FUND SERVED PAST 5 YEARS /(1)/ ELECTED /(3)/ /(2)/
- ---------------------- --------- ------- ---------------------------------- ------------- ----------------------------------
John T. Ludes Director 3 years President, LFP Properties 38
57 Water Street (consulting firm); Formerly,
Marion, MA 02738 Trustee, Zenith Fund**; formerly,
Age: 68 Vice Chairman, President and Chief
Operating Officer, Fortune
Brands/American Brands (global
conglomerate); formerly, President
and CEO, Acushnet Company
(athletic equipment).
Frances M. Hawk, CFA, N/A N/A Formerly, Principal and Portfolio 49 Member, Board of Managers, six
CFP Manager, HLM Management Co., Inc. variable annuity separate accounts
108 Oxford Hill Lane (SEC registered investment of The Travelers Insurance
Dowington, PA adviser); Formerly, Assistant Company*; Trustee, five mutual
Age: 58 Treasurer, United Technologies funds sponsored by The Travelers
Corp., Inc., (diversified Insurance Company*.
manufacturing company).
- --------
^ As present or former officers of MetLife and/or owners of securities issued
by MetLife, Inc., the ultimate parent company of the Manager, Messrs.
McHaffie and Typermass may each be deemed to be an "interested person"
within the meaning of the 1940 Act.
* Indicates a directorship with a registered investment company or a company
subject to the reporting requirements of the Securities Exchange Act of
1934, as amended (the "Exchange Act").
** Following the sale of all of its assets to the Fund on May 1, 2003, the
Zenith Fund deregistered as an investment company with the Securities and
Exchange Commission ("SEC") on January 29, 2004.
(+) Served as a trustee, director and/or officer of one or more of the
following companies, each of which had a direct or indirect advisory
relationship with the Manager or its affiliates prior to January 31, 2005:
State Street Research Financial Trust, State Street Research Income Trust,
State Street Research Money Market Trust, State Street Research
Institutional Funds, State Street Research Capital Trust, State Street
Research Master Investment Trust, State Street Research Equity Trust, State
Street Research Securities Trust and State Street Research Exchange Trust.
(1) Previous positions during the past five years with the Fund, MetLife, the
Manager, Zenith Fund, NELICO, New England Financial, New England Funds,
L.P. or New England Securities Corporation are omitted if not materially
different.
(2) Each Director of the Fund also serves as trustee of Metropolitan Series
Fund II ("Met Series Fund II"), a registered investment company advised by
the Manager. Each officer of the Fund serves in the same position with Met
Series Fund II, which consists of one portfolio.
(3) The Fund Complex includes the Fund (37 portfolios), Met Series Fund II (1
portfolio), variable annuity separate accounts of The Travelers Insurance
Company (6 accounts), mutual funds sponsored by the Travelers Insurance
Company (5 funds) and CitiStreet Funds, Inc. (4 portfolios).
9
The term of office of each person elected as Director will be until the next
annual meeting of shareholders and until his or her successor is elected and
qualified. Each of the Nominees has agreed to serve as Director if elected. If
any of the Nominees should be unavailable for election at the time of the
Meeting (which is not presently anticipated), the persons named as proxy may
vote for other persons in their discretion, or the Directors may vote to fix
the number of Directors at fewer than nine.
The Fund's Bylaws do not require the annual election of Directors. In
accordance with the 1940 Act, (i) the Fund will hold a shareholders' meeting
for the election of Directors at such time as less than a majority of the
Directors holding office have been elected by shareholders, and (ii) if, as a
result of a vacancy in the Board of Directors, less than two-thirds of the
Directors holding office have been elected by the shareholders, that vacancy
may only be filled by a vote of the shareholders.
There were [six] meetings of the Board of Directors during 2005. All of the
current directors attended at least 75% of the aggregate of (1) the total
number of meetings of the Board and (2) the total number of meetings held by
all committees of the Board on which they served. It is expected that the Board
of Directors will generally meet at least four times each year.
Committees of the Board of Directors
____________________________________
The Board of Directors of the Fund has a standing Nominating Committee,
Audit Committee, Governance Committee and two Contract Review Committees.
The Audit Committee met three times during 2005. Messrs. Garban, Ludes and
Morton and Ms. Strumpf are the members of the Audit Committee, all of whom are
Independent Directors. The Audit Committee reviews financial and accounting
controls and procedures; recommends the selection of the independent registered
public accounting firm; reviews the scope of the audit; reviews financial
statements and audit reports; and reviews the independence of the independent
registered public accounting firm and approves fees and assignments relating to
both audit and non-audit activities of the independent registered public
accounting firm. Ms. Strumpf currently serves as chair of the Audit Committee.
Each Contract Review Committee met once during 2005, and there was also one
Special Contract Review Committee meeting during 2005, attended by certain
members of each of the Fund's standing Contract Review Committees. One standing
Contract Review Committee consists of Messrs. Arnelle and Ludes and
Ms. Strumpf, and Ms. Strumpf currently serves as its chair. The other standing
Contract Review Committee consists of Ms. Hawthorne and Mr. Garban, and
Mr. Garban currently serves as its chair. Each Contract Review Committee from
time to time reviews and makes recommendations to the Board as to contracts
that require approval of a majority of the Independent Directors, which are
assigned to such Contract Review Committee by the Board, and any other
contracts that may be referred to it by the Board.
10
The Governance Committee met three times during 2005. Messrs. Arnelle and
Scott Morton and Ms. Hawthorne are members of the Governance Committee, and
Mr. Scott Morton currently serves as its Chair. The Governance Committee
reviews periodically Board governance practices, procedures and operations, the
size and composition of the Board of Directors, Director compensation and other
matters relating to the governance of the Fund.
Nominating Committee Information
________________________________
The Nominating Committee did not meet in 2005, but met [two] times during
2006 prior to the date of this Proxy Statement. Messrs. Arnelle and Scott
Morton and Ms. Hawthorne are members of the Nominating Committee, and Mr. Scott
Morton currently serves as its chair. The Nominating Committee evaluates the
qualifications of candidates for Independent Director positions and makes
recommendations to the Independent Directors with respect to nominations for
Independent Director membership on the Fund's Board. The Nominating Committee
considers Independent Director candidates in connection with Board vacancies
and newly created Board positions.
The Nominating Committee will consider nominees for Independent Directors
recommended by Contract Owners. The Board has adopted procedures that a
Contract Owner must follow to properly submit a recommendation to the
Nominating Committee. Recommendations must be in a writing submitted to the
Fund's Secretary, c/o MetLife Advisers, LLC, 501 Boylston Street, Boston, MA
02116, and must include: (i) a statement in writing setting forth (A) the name,
age, date of birth, business address, residence address and nationality of the
person recommended by the Contract Owner (the "candidate"); (B) the number of
units that relate to shares of each Portfolio (and class) of the Fund
attributable to any annuity or life insurance contract of the candidate, as
reported to such Contract Owner by the candidate; (C) any other information
regarding the candidate called for with respect to director nominees by
paragraphs (a), (d), (e) and (f) of Item 401 of Regulation S-K or paragraph
(b) of Item 22 of Rule 14a-101 (Schedule 14A) under the Exchange Act; (D) any
other information regarding the candidate that would be required to be
disclosed if the candidate were a nominee in a proxy statement or other filing
required to be made in connection with the election of Independent Directors
pursuant to Section 14 of the Exchange Act and the rules and regulations
promulgated thereunder; and (E) information regarding the candidate that will
be sufficient for the Fund to make a determination as to whether the candidate
is or will be an "interested person" of the Fund (as defined in the 1940 Act);
(ii) the written and signed consent of the candidate to be named as a nominee
and to serve as an Independent Director if elected; (iii) the name of the
recommending Contract Owner as it appears on the books of the relevant
Insurance Company separate account; (iv) the number of units that relate to
shares of each Portfolio (and class) of the Fund attributable to any annuity or
life insurance contract of such recommending Contract Owner; and (v) a
description of all arrangements or understandings between the recommending
Contract Owner and the candidate and any other person or persons (including
their names) pursuant to which the recommendation is being made by the
recommending Contract Owner. In addition, the
11
Nominating Committee may require the candidate to furnish such other
information as it may reasonably require or deem necessary to determine the
eligibility of such candidate to serve on the Board or to satisfy applicable
law. The Nominating Committee accepts recommendations on a continuous basis.
Securities Ownership
____________________
At February 1, 2006, the Directors of the Fund as a group owned less than 1%
of the outstanding shares of the Fund or any Portfolio.
The following table states the dollar range of equity securities
beneficially owned by the Nominees in the Portfolios of the Fund:
AGGREGATE DOLLAR
RANGE OF EQUITY
SECURITIES IN ALL
PORTFOLIOS
OVERSEEN OR TO
BE OVERSEEN BY
DIRECTOR OR
NOMINEE IN
DOLLAR RANGE OF FAMILY OF
EQUITY SECURITIES IN INVESTMENT
NAME OF NOMINEE EACH PORTFOLIO (A) COMPANY (B)
- --------------- -------------------- -----------------
ARTHUR G. TYPERMASS Over $100,000
BlackRock Aggressive Growth Portfolio. Over $100,000
MetLife Stock Index Portfolio......... Over $100,000
FI International Stock Portfolio...... $10,001-$50,000
[Fixed Income]........................ $50,001-$100,000
- --------
(a)Represents ownership, as of February 1, 2006, of insurance products that
utilize the Fund as an investment vehicle. Shares of the Fund may not be
held directly by individuals.
(b)The term "Family of Investment Companies" as used in this Proxy Statement
includes each Portfolio in the Fund.
The Independent Director Nominees and their immediate family members do not
beneficially own any securities in an investment adviser or principal
underwriter of the Fund, or a person (other than a registered investment
company) directly or indirectly controlling, controlled by or under common
control with an investment adviser or principal underwriter of the Fund, as of
February 1, 2006.
Director Compensation
_____________________
The officers and Directors of the Fund who are officers or employees of the
Manager, of any subadviser of the Fund or of MetLife receive no compensation
from the Fund for their services in such capacities, although they may receive
compensation from MetLife, the Manager or any affiliate for services rendered
in those or other capacities.
Each Director who is not currently an active employee of MetLife or its
affiliates also serves as trustee and member of the same committees of Met
Series Fund II and for serving in all capacities receives an aggregate retainer
fee at the annual rate of $56,000, plus aggregate attendance fees of $6,000 for
each Directors' meeting attended, aggregate attendance fees of $2,500 for each
committee meeting attended (provided that, if the
12
Governance Committee and the Nominating Committee hold a joint meeting, each
attendee receives $2,500 in aggregate for that meeting) and reimbursement for
out-of pocket expenses related to such attendance. The chair of the Audit
Committee, the chair of the Governance Committee and the Nominating Committee,
and the chair of each of the Contract Review Committees each receives an
aggregate fee of $2,500 for each full calendar year during which he/she serves
as such chair. The Lead Independent Director of the Fund, Mr. Garban, who was
appointed to such position on February 5, 2004, receives an additional
aggregate annual retainer fee of $5,000. These fees are allocated among the
Portfolios and the one portfolio of Met Series Fund II based on a formula that
takes into account, among other factors, the net assets of each Portfolio and
the portfolio of Met Series Fund II.
The Fund provides no pension or retirement benefits to Directors.
The following table sets forth information regarding compensation received
by the Independent Directors of the Fund for the year ended December 31, 2005.
TOTAL
PENSION OR COMPENSATION
RETIREMENT FROM FUND AND
AGGREGATE BENEFITS ACCRUED ESTIMATED ANNUAL FUND COMPLEX
COMPENSATION AS PART OF FUND BENEFITS UPON PAID TO
NAME OF DIRECTOR FROM FUND EXPENSES RETIREMENT DIRECTORS
- ----------------------------- ------------ ---------------- ---------------- -------------
Linda B. Strumpf..............
Steve A. Garban...............
H. Jesse Arnelle..............
Michael S. Scott Morton.......
Arthur G. Typermass...........
Nancy Hawthorne...............
John T. Ludes.................
Shareholder Communication with the Board of Directors
_____________________________________________________
The Fund has adopted procedures by which Contracts Owners may send
communications to the Board. These communications should be sent to the
attention of the Board, Metropolitan Series Fund, Inc., c/o Thomas M. Lenz, 501
Boylston Street, Boston, MA 02116.
A communication must (i) be in writing and be signed by the Contract Owner,
(ii) identify the specific Portfolio, if any, of the Fund to which it relates,
and (iii) identify the numbers of units that relate to shares of a Portfolio of
the Fund held by the Contract Owner.
These procedures do not apply to (i) any communication from an officer or
Director of the Fund, (ii) any communication from an employee or agent of the
Fund,
13
unless such communication is made solely in such employee's or agent's capacity
as a Contract Owner or (iii) any shareholder proposal submitted pursuant to
Rule 14a-8 under the Exchange Act or any communication made in connection with
such a proposal. See Appendix A.
Director Indemnification
________________________
Pursuant to Maryland law and the Fund's Bylaws, the Fund shall indemnify or
advance any expenses to current and former Directors and officers to the extent
permitted or required by the Maryland General Corporation Law. Except as
specifically required by the Maryland General Corporation Law, however, the
Fund shall only be required to indemnify or advance expenses to any person
other than a Director to the extent specifically approved by resolution adopted
by the Board in accordance with applicable law. No indemnification or advance
payment is provided to protect any Director or officer of the Fund against any
liability to the Fund or its security holders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office. The
Bylaws also provide that the Fund may not make an advance payment of legal
expenses for the defense of a proceeding brought by the Fund or its security
holders against a Director or officer of the Fund unless the Director or
officer undertakes to repay the advance unless it is ultimately determined that
he is entitled to indemnification and (i) he provides a security for his
undertaking, (ii) the Fund shall be insured against losses arising by reason of
any lawful advances or (iii) a majority of a quorum of Directors who are
neither "interested persons" of the Fund nor parties to the proceeding, or an
independent legal counsel in a written opinion, determines that there is reason
to believe that the Director or officer will ultimately be found entitled to
indemnification.
Vote Required for this Proposal
_______________________________
If you submit voting instructions that do not specify otherwise, the
Insurance Companies will vote Fund shares for the election of the Nominees
listed above. If any of said Nominees should be unable to serve, the Insurance
Companies reserve full discretion to vote for another candidate or candidates.
The election of the Directors of the Fund will be by a plurality of the votes
cast (all Portfolios of the Fund voting together as a single class) at the
Meeting in person or by proxy.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS OF THE
FUND VOTE FOR EACH NOMINEE.
II: APPROVAL OF AN AMENDMENT TO THE ADVISORY AGREEMENT BETWEEN THE FUND, ON
BEHALF OF MFS TOTAL RETURN, AND THE MANAGER.
14
Introduction
____________
On December 13, 2005, the Board approved the proposed reorganization of the
MFS Total Return Portfolio (the "Travelers Portfolio"), a series of The
Travelers Series Trust (the "Trust"), into the Fund's MFS Total Return
Portfolio (the "MFS Total Return Reorganization"). The Trust's Board of
Trustees approved the MFS Total Return Reorganization on behalf of the
Travelers Portfolio at a meeting held on November 10, 2005 and recommended that
the MFS Total Return Reorganization be submitted to the Travelers Portfolio's
shareholders for approval. MFS Total Return's shareholders are not required to
approve the MFS Total Return Reorganization. If approved by the Travelers
Portfolio's shareholders, the MFS Total Return Reorganization is expected to
close on May 1, 2006.
Massachusetts Financial Services Company (the "Subadviser"), subadviser to
both MFS Total Return and the Travelers Portfolio, has informed the Fund that
it is not willing to serve as subadviser to MFS Total Return at its current
subadvisory fee schedule past May 1, 2006. In connection therewith and after
negotiation with the Manager, the Subadviser informed the Fund that, should the
MFS Total Return Reorganization be consummated and in light of the increase in
assets of MFS Total Return that would result from such reorganization, it would
be willing to continue to act as subadviser to MFS Total Return after May 1,
2006 at the new subadvisory fee rates shown in the table below (the
"Subadvisory Fee Change").
CURRENT SUBADVISORY FEE PROPOSED SUBADVISORY FEE AFTER MAY 1, 2006
- -------------------------------------------- ------------------------------------------
SUBADVISORY FEE SUBADVISORY FEE
(as a % of average (as a % of average
ASSET LEVEL daily net assets) ASSET LEVEL daily net assets)
- -------------------------- ------------------ ------------------------ ------------------
First $50 million 0.25% First $250 million 0.35%
Excess over $50 million 0.20% Next $1 billion 0.30%
Next $250 million 0.25%
Excess over $1.5 billion 0.20%
In light of the Subadviser's intention to seek an increased subadvisory fee
with respect to MFS Total Return and as discussed more fully below, the Manager
has informed the Fund that, should the subadvisory fee schedule for MFS Total
Return be increased as described above, the Manager would seek an increase in
the advisory fee schedule for MFS Total Return after May 1, 2006 to the levels
shown in the table below (the "Advisory Fee Change"). The Advisory Fee Change
is designed to allow the Manager to continue to provide high-quality advisory
services to MFS Total Return at a reasonable and competitive fee rate and to
avoid penalizing the Manager should the Subadvisory Fee Change take effect,
given that the Manager would then be compensating the Subadviser at the new
subadvisory fee schedule discussed above, and reflects the fact that, because
of economies of scale expected to be realized, should the MFS Total Return
Reorganization be consummated, the total expense levels of MFS Total Return are
expected to decrease by an amount equal to or greater than the advisory fee
increase, although no assurances can be given that such expense decrease will
result.
15
CURRENT ADVISORY FEE PROPOSED ADVISORY FEE AFTER MAY 1, 2006
----------------------------- ------------------------------------------
ADVISORY FEE ADVISORY FEE
(as a % of average (as a % of average
ASSET LEVEL daily net assets) ASSET LEVEL daily net assets)
----------- ------------------ ------------------------ ------------------
All Assets 0.50% First $250 million 0.60%
Next $500 million 0.55%
Excess over $750 million 0.50%
As more fully discussed below, at meetings held on November 3, 2005 and
February 1, 2006, as the case may be, and after careful consideration, the
Board of Directors, including a majority of the Independent Directors, decided
to approve the Subadvisory Fee Change and Advisory Fee Change. The Advisory Fee
Change would be accomplished by amending the Advisory Agreement to reflect the
new advisory fee schedule for MFS Total Return (as amended, the "Amended
Advisory Agreement"). Accordingly, pursuant to the Proposal, the Directors are
proposing that the shareholders of MFS Total Return approve the Amended
Advisory Agreement at the Meeting. Both the Subadvisory Fee Change and proposed
Advisory Fee Change are contingent on the consummation of the MFS Total Return
Reorganization.
Reasons for the Advisory Fee Change
___________________________________
As noted above, the Advisory Fee Change was precipitated by the Subadviser's
request for the Subadvisory Fee Change. In connection with its request for the
Subadvisory Fee Change, the Subadviser noted that the current subadvisory fee
schedule for MFS Total Return is below market levels, and that, in order to
allow the Subadviser to continue to manage the day-to-day portfolio management
affairs of MFS Total Return, retain and attract highly qualified investment
professionals and offer a high level of service to shareholders, its
subadvisory fee schedule would need to be increased. The Directors, desiring to
retain the Subadviser as subadviser to MFS Total Return after May 1, 2006 and
having noted that MFS Total Return's current subadvisory fee schedule is below
market levels, agreed to the Subadvisory Fee Change, contingent upon the
consummation of the MFS Total Return Reorganization.
Because the Subadvisory Fee Change will increase the amount the Manager must
pay the Subadviser, the Manager is seeking the Advisory Fee Change. For the
reasons discussed below, the Directors determined at their November 3, 2005
meeting that it would be in the best interests of MFS Total Return and its
shareholders to approve the Advisory Fee Change as reflected in the proposed
Amended Advisory Agreement.
In approving the Amended Advisory Agreement, the Directors considered a wide
range of information of the type they regularly consider when determining
whether to
16
continue the Fund's advisory or subadvisory agreements in effect from year to
year. In coming to this decision, the Directors also considered information
about, and concluded they were satisfied with, the following, among other
things:
. that, in order to retain the Subadviser as subadviser to MFS Total Return
following the consummation of the MFS Total Return Reorganization, the
Subadvisory Fee Change was necessary and that, in order to avoid
penalizing the Manager for such increase, the advisory fee should be
adjusted as reflected by the Amended Advisory Agreement;
. that the advisory and subadvisory fee schedules under MFS Total Return's
current Advisory Agreement and subadvisory agreement are below market
levels;
. that, following the MFS Total Return Reorganization, total expenses for
MFS Total Return are expected to decrease by a greater amount than the
Portfolio's proposed advisory fee increase, though no assurances can be
given that any such expense decrease will in fact be realized;
. that the Advisory Fee Change would enable the Manager to continue to
provide high-quality advisory services to MFS Total Return at a
reasonable and competitive fee rate; and
. that, other than with respect to the Advisory Fee Change, the Amended
Advisory Agreement is identical to the current Advisory Agreement.
In determining to approve the Amended Advisory Agreement, the Directors also
considered other information that they believed relevant, including information
about the Manager's organizational structure and financial condition. It was
also noted that the proposed advisory fee rates under the Amended Advisory
Agreement contain breakpoints and, accordingly, reflect the potential to share
economies of scale. The Board of Directors also concluded that the Advisory Fee
Change would be, on balance, more favorable for MFS Total Return's shareholders
than the alternative of replacing the Subadviser with some other subadviser
that might be willing to serve as subadviser at MFS Total Return's current
subadvisory fee rate.
After engaging in the review process, and carefully considering the
information summarized above, the Directors unanimously voted to approve, and
to recommend that MFS Total Return's shareholders vote to approve, the Amended
Advisory Agreement.
Description of the Current Advisory Agreement
_____________________________________________
The Manager currently serves as investment adviser to MFS Total Return
pursuant to the Advisory Agreement, which is dated May 1, 2003 and is between
the Fund, on behalf of MFS Total Return, and the Manager. The Advisory
Agreement was entered into in connection with the reorganization of MFS Total
Return from a series of the Zenith fund into a series of the Fund, which was
approved by the shareholders of such
17
Zenith Fund series at a special meeting held on April 25, 2003. The Directors
most recently approved the renewal of the Advisory Agreement at a meeting held
on November 3, 2005.
The Advisory Agreement provides that the Manager will, subject to its rights
to delegate certain responsibilities to another party or parties, provide the
Portfolio both portfolio management services and administrative services,
although the Manager has delegated its portfolio management responsibilities
for MFS Total Return to the Subadviser. Pursuant to the Advisory Agreement, the
Manager furnishes or pays the expenses of MFS Total Return for office space,
facilities and equipment, services of executive and other personnel of MFS
Total Return and certain administrative services. Currently, pursuant to the
Advisory Agreement, the Fund pays the Manager compensation at the annual rate
of 0.50% of average net assets.
Description of the Amended Advisory Agreement
_____________________________________________
The Board of Directors has approved, and proposes that shareholders of MFS
Total Return approve, the Amended Advisory Agreement, which would affect the
Advisory Fee Change discussed above. Other than with respect to the Advisory
Fee Change, the Amended Advisory Agreement would be identical to the current
Advisory Agreement. The Amended Advisory Agreement is attached to this Proxy
Statement as Appendix B.
Comparison of the Advisory Agreement and Amended Advisory Agreement
___________________________________________________________________
As stated above, other than with respect to the Advisory Fee Change, the
Amended Advisory Agreement would be identical to the current Advisory Agreement.
The table below compares the annual operating expenses under the current
advisory fee schedule for the year ended December 31, 2005 to the estimated
annual operating expenses under the proposed advisory fee schedule if the
Advisory Fee Change had been in effect for the year ended December 31, 2005.
The table assumes that the MFS Reorganization was consummated on December 31,
2004 and that, based on the combined assets of MFS Total Return and the
Travelers Portfolio of approximately [$1.8 billion], as of [September 30,
2005], the weighted average advisory fee of MFS Total Return under the proposed
advisory fee schedule would be [ ]%.
THE TABLE DOES NOT REFLECT ANY FEES, EXPENSES AND WITHDRAWAL CHARGES IMPOSED BY
THE CONTRACTS FOR WHICH MFS TOTAL RETURN SERVES AS AN INVESTMENT VEHICLE. IF
THOSE FEES AND EXPENSES HAD BEEN INCLUDED, YOUR COSTS WOULD BE HIGHER.
18
Annual Portfolio Operating Expenses
(expenses that are deducted from MFS Total Return assets)
Class A Class B Class E Class F*
------------- ------------ ------------ --------
Pro Pro Pro Pro
Current Forma Current Forma Current Forma Forma
------- ----- ------- ----- ------- ----- --------
Management Fees......................... 0.50% % 0.50% % 0.50% % %
Distribution and Service (12b-1) Fees... None None 0.25% 0.25% 0.15% 0.15% 0.20%
Other Expenses**........................ % % % % % % %
Total Annual Fund.......................
Operating Expenses**.................... % % % % % % %
- --------
* In connection with the Reorganization, MFS Total Return will issue Class F
shares to shareholders of the Travelers Portfolio.
** MFS Total Return directed certain portfolio trades to brokers who paid a
portion of the Portfolio's expenses. The expense information for MFS Total
Return does not reflect this reduction in expenses. If this reduction were
shown, MFS Total Return's Total Annual Operating Expenses would have been
____% for Class A shares, ____% for Class B shares and ____% for Class E
shares.
The tables below show examples of the total expenses you would pay on a
$10,000 investment over one-, three-, five- and ten-year periods. The tables
are intended to help you compare the cost of investing in MFS Total Return
under the current advisory fee schedule versus investing in MFS Total Return
under the proposed advisory fee schedule. The examples assume a 5% average
annual return, that you redeem all of your shares at the end of each time
period and that you reinvest all of your dividends. The following tables also
assume that total annual operating expenses remain the same. THE EXAMPLES ARE
FOR ILLUSTRATION ONLY, AND YOUR ACTUAL COSTS MAY BE HIGHER OR LOWER.
THE EXAMPLES DO NOT REFLECT ANY FEES, EXPENSES OR WITHDRAWAL CHARGES IMPOSED BY
THE CONTRACTS FOR WHICH MFS TOTAL RETURN SERVES AS AN INVESTMENT VEHICLE. IF
THOSE FEES AND EXPENSES HAD BEEN INCLUDED, YOUR COSTS WOULD BE HIGHER.
Examples of Portfolio Expenses
______________________________
(CURRENT)
----------------------------------------------------------------------------
One Year Three Years Five Years Ten Years
-------- ----------- ---------- ---------
Class A............................ $ $ $ $
Class B............................ $ $ $ $
Class E............................ $ $ $ $
(PRO FORMA)
----------------------------------------------------------------------------
One Year Three Years Five Years Ten Years
-------- ----------- ---------- ---------
Class A............................ $ $ $ $
Class B............................ $ $ $ $
Class E............................ $ $ $ $
Class F*........................... $ $ $ $
- --------
* In connection with the Reorganization, MFS Total Return will issue Class F
shares to shareholders of the Travelers Portfolio.
19
The aggregate amount of the Manager's advisory fee during the year ended
December 31, 2005 was [ ]. If the proposed advisory fee schedule had been
in effect during the year ended December 31, 2005, and if the MFS Total Return
Reorganization had taken place as of December 31, 2004, the aggregate amount of
the Manager's advisory fee would have been [ ]. The difference between
these amounts is [ ].
Additional Information
______________________
Certain Interested Directors and officers of the Fund may be owners of
shares of MetLife or its affiliates, and consequently, if MFS Total Return's
shareholders approve the Amended Advisory Agreement, such officers and
Directors may stand to benefit from such change.
The information set forth in this Proxy Statement concerning the Subadvisory
Fee Change and Advisory Fee Change has been provided to the Fund by MetLife.
Shareholder Voting Regarding the Amendment to the Advisory Agreement
____________________________________________________________________
The vote required to approve the Amended Advisory Agreement is the lesser of
(i) 67% of the shares of MFS Total Return that are present at the Meeting, if
the holders of more than 50% of the shares of such Portfolio outstanding as of
the Record Date are present or represented by proxy at the Meeting, or
(ii) more than 50% of the shares of MFS Total Return outstanding on the Record
Date. If the required vote is not obtained for MFS Total Return, the Directors
will consider what other actions to take in the best interests of MFS Total
Return. Actions considered might include replacement of the Subadviser with a
different subadviser.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS OF MFS
TOTAL RETURN VOTE FOR THE AMENDMENT TO THE ADVISORY AGREEMENT.
III: APPROVAL OF CHANGES TO CERTAIN PORTFOLIOS' FUNDAMENTAL INVESTMENT
RESTRICTIONS
The 1940 Act requires a registered investment company, such as each
Portfolio, to have "fundamental" investment restrictions governing certain of
its investment practices. An investment restriction is "fundamental" if it can
be changed only with the approval of a majority of the outstanding voting
securities of the investment company. Investment companies may also voluntarily
designate restrictions relating to other investment practices as fundamental.
20
Certain portfolios of the Fund were previously series of the Zenith Fund
(the "Zenith Fund Portfolios"). The other portfolios of the Fund have always
been series of the Fund (the "Met Series Fund Portfolios"). The proposals to
change or eliminate fundamental and non-fundamental investment restrictions
relate only to certain Met Series Fund Portfolios. The affected Met Series Fund
Portfolios are the BlackRock Aggressive Growth Portfolio, BlackRock Diversified
Portfolio, BlackRock Investment Trust Portfolio, BlackRock Large Cap Value
Portfolio, BlackRock Strategic Value Portfolio, FI International Stock
Portfolio, FI Mid Cap Opportunities Portfolio, Franklin Templeton Small Cap
Growth Portfolio, Harris Oakmark Large Cap Value Portfolio, Lehman Brothers
Aggregate Bond Index Portfolio, MetLife Mid Cap Stock Index Portfolio, MetLife
Stock Index Portfolio, Morgan Stanley EAFE Index Portfolio, Neuberger Berman
Mid Cap Value Portfolio, Oppenheimer Global Equity Portfolio, Russell 2000
Index Portfolio, T. Rowe Price Large Cap Growth Portfolio and T. Rowe Price
Small Cap Growth Portfolio.
Certain of the Met Series Fund Portfolios' fundamental investment
restrictions are not required by the 1940 Act and were adopted over the years
in response to regulatory, business or industry requirements or conditions that
are no longer in effect. Also, certain of these fundamental investment
restrictions were originally adopted based on those applicable to certain
retail funds advised or subadvised by the Met Series Fund Portfolios'
then-current subadvisers. As many of these Portfolios have changed subadviser
since the time that their fundamental investment restrictions were drafted,
certain of these restrictions may no longer be relevant or desirable. In
addition, many of the Met Series Fund Portfolios' fundamental investment
restrictions relating to the same activity are not consistent with one another
or those of the Zenith Fund Portfolios. These inconsistencies could cause
difficulty in monitoring compliance among the Portfolios.
The Board of Directors reviewed each Portfolio's fundamental investment
restrictions and is proposing to eliminate those fundamental investment
restrictions that are not required by the 1940 Act and to simplify, modernize
(in light of current regulatory requirements) and make more consistent those
fundamental investment restrictions that are required. In certain instances, it
is proposed that fundamental investment restrictions be revised to permit
flexibility to the extent permitted by the 1940 Act, rules adopted under the
1940 Act or applicable interpretations of the SEC or its staff. The Directors
believe that the proposed changes will enhance the ability of the Manager and
the subadvisers of the affected Met Series Fund Portfolios to manage such
Portfolios' assets. In addition, the Directors believe that the proposed
changes will simplify the process of monitoring the Portfolios' compliance with
their investment restrictions.
Although it is proposed that fundamental investment restrictions relating to
certain investment practices be eliminated or revised to permit flexibility, in
many cases a Portfolio will continue to be subject to formal, written
restrictions on those investment practices. However, these investment
restrictions will not be fundamental and, to the extent permitted by applicable
law, may be changed by the Board of Directors without shareholder approval. The
actual investment strategies and practices of the Met Series Fund Portfolios
are not currently expected to change as a result of the proposed changes
21
to the fundamental investment restrictions, although, with the approval of the
Board of Directors, the Manager or subadvisers may change those strategies and
practices in the future.
The proposed elimination of or revisions to certain of the fundamental
investment restrictions of the Met Series Fund Portfolios are discussed below.
The following summaries of the relevant Portfolios' current fundamental
investment restrictions are qualified by reference to the actual text of the
restrictions set forth in Appendix C. The table in Appendix C sets out in the
left hand column the current fundamental investment restrictions of each
affected Met Series Fund Portfolio that are proposed to be eliminated or
changed in this Proxy Statement and, if applicable, the proposed change to each
such restriction in the right hand column.
PROPOSALS
_________
III-A. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO BORROWING.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restrictions of the
affected Portfolios relating to borrowing will be revised. The proposed revised
fundamental investment restriction is set forth below:
The Portfolio may not borrow money, except to the extent permitted by
applicable law, regulation or order.
The Directors are proposing that the affected Portfolios' fundamental
investment restrictions on borrowing be liberalized to allow the affected
Portfolios to borrow money to the maximum extent permitted by law. The
Directors believe that having a standard fundamental policy relating to
borrowing for all Portfolios will simplify compliance monitoring, facilitate
standard borrowing arrangements for the Portfolios and provide maximum
investment flexibility as permitted under the 1940 Act. The 1940 Act generally
prohibits a fund from borrowing unless the fund borrows from a bank and
maintains continuous asset coverage (that is, total assets including
borrowings, less liabilities exclusive of borrowings) of 300% of the amount
borrowed. Certain trading practices, such as reverse repurchase agreements, may
constitute a borrowing and may be subject to the 1940 Act restrictions on
borrowings.
22
If this Proposal is approved, the affected Portfolios may be allowed to
borrow in situations and under circumstances in which they were previously not
allowed to borrow. Borrowing may cause the value of a Portfolio's shares to be
more volatile than if the Portfolio did not borrow. This is because borrowing
tends to exaggerate the effect of any increase or decrease in the value of a
Portfolio's securities.
III-B. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO UNDERWRITING OF
SECURITIES.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restriction of the
affected Portfolios relating to the underwriting of securities issued by others
will be revised. The affected Portfolios will become subject to the following
revised fundamental investment restriction:
The Portfolio may not underwrite securities issued by other persons
except to the extent that, in connection with the disposition of its
portfolio investments, it may be deemed to be an underwriter under certain
federal securities laws.
The primary purpose of this Proposal is to eliminate minor differences in
the wording of the affected Portfolios' current fundamental investment
restriction on underwriting securities to achieve consistency with the
fundamental investment restrictions of other Portfolios of the Fund.
III-C. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO THE ISSUANCE OF
SENIOR SECURITIES.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
23
If this Proposal is approved, the fundamental investment restrictions of
each affected Portfolio relating to the issuance of senior securities will be
revised. Each affected Portfolio will become subject to the following
fundamental investment restriction:
The Portfolio may not issue senior securities except to the extent
permitted by applicable law, regulation or order.
For purposes of this restriction, collateral arrangements with respect to
any type of swap, option, forward contract or futures contract and collateral
arrangements with respect to initial and variation margin would not be deemed
to involve the issuance of a senior security.
The 1940 Act imposes limitations on an open-end investment company's ability
to issue senior securities. The term "senior security," which is defined in the
1940 Act, generally means any security evidencing indebtedness of an investment
company (for example, a bond or note) or any class of shares of an investment
company having priority over any other class as to the investment company's
assets or earnings. The SEC staff permits investment companies to engage in
certain trading practices that may be considered to involve the issuance of
senior securities (for example, short sales, reverse repurchase agreements,
futures contracts) provided that certain conditions are satisfied. Under the
proposed investment restriction, the affected Portfolios would be permitted to
engage in transactions that could be deemed to involve the issuance of senior
securities only in accordance with applicable regulatory requirements under the
1940 Act.
The proposed investment restriction is intended to simplify and standardize
the language of the Portfolios' policies concerning the issuance of senior
securities, and to permit each affected Portfolio to take full advantage of all
investment flexibility permitted under applicable law.
A borrowing by a Portfolio would involve the issuance of senior securities.
Borrowing may cause the value of a Portfolio's shares to be more volatile than
if the Portfolio did not borrow. This is because borrowing tends to exaggerate
the effect of any increase or decrease in the value of a Portfolio's securities.
III-D. ELIMINATE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO OPTIONS.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
24
If this Proposal is approved, the fundamental investment restrictions of
each affected Portfolio relating to options will be eliminated. This
fundamental investment restriction has not been adopted by other Portfolios of
the Fund and is not required by law. The Board believes that eliminating this
investment restriction will provide the affected Portfolios greater investment
flexibility.
III-E. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO MAKING LOANS.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restriction of each
affected Portfolio relating to making loans will be revised. The proposed
revised fundamental restriction is set forth below:
The Portfolio may not make loans, except by purchasing debt obligations
in which the Portfolio may invest consistent with its investment policies,
by entering into repurchase agreements, by lending its portfolio securities,
or as otherwise permitted by applicable law, regulation or order.
The Directors are proposing this revision in order to simplify and
standardize the language of the restriction for each affected Portfolio and to
give the affected Portfolios more flexibility to maximize lending capabilities.
If this Proposal is approved, each affected Portfolio will be able to lend its
portfolio securities to the maximum extent permitted by law. The Directors
believe that the proposed revision will provide the affected Portfolios with
greater ability to respond more effectively to regulatory, industry and market
developments and to increase income from securities lending.
For the purpose of achieving income, a Portfolio may lend its portfolio
securities to brokers, dealers and other financial institutions provided a
number of conditions are satisfied, including that the loan is fully
collateralized. When a Portfolio lends portfolio securities, its investment
performance will continue to reflect changes in the value of the securities
loaned, and the Portfolio will also receive a fee or interest on the
collateral. Securities lending involves the risk of loss of rights in the
collateral or delay in recovery of the collateral if the borrower fails to
return the security loaned or becomes insolvent. A Portfolio may pay lending
fees to the party arranging the loan.
25
III-F. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO REAL ESTATE.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restriction of each
affected Portfolio relating to real estate will be revised. The proposed
revised fundamental restriction is set forth below:
The Portfolio may not purchase or sell real estate, except that,
consistent with its investment policies, the Portfolio may purchase
securities of issuers which deal in real estate, securities which are
secured by interests in real estate, and securities which represent
interests in real estate, and it may acquire and dispose of real estate or
interests in real estate acquired through the exercise of its rights as a
holder of debt obligations secured by real estate or interests therein.
The Directors are proposing this revision in order to simplify and
standardize the language of the restriction for each affected Portfolio. The
Directors believe that the revision of this fundamental investment restriction
will give each affected Portfolio additional investment flexibility for
purposes of pursuing its investment objective.
III-G. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO INDUSTRY
CONCENTRATION.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restrictions of
each affected Portfolio relating to industry concentration will be revised. The
proposed revised fundamental restriction is set forth below.
The Portfolio may not purchase securities (other than (i) securities
issued or guaranteed by the U.S. government, its agencies or
instrumentalities, (ii) securities of a registered investment company, and
(iii) in the case of
26
BlackRock Money Market, bank instruments issued by domestic banks and U.S.
branches of foreign banks) if, as a result of such purchase, more than 25%
of the total assets of the Portfolio (as of the time of investment) would be
invested in any one industry, except to the extent permitted by applicable
law, regulation or order.
The primary purpose of this Proposal is to eliminate differences in the
wording of the affected Portfolios' current fundamental investment restriction
on industry concentration to achieve consistency with the fundamental
investment restrictions of other Portfolios of the Fund.
III-H. ELIMINATE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO FOREIGN
SECURITIES.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON SMALL
CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, METLIFE MID CAP STOCK INDEX,
METLIFE STOCK INDEX, NEUBERGER BERMAN MID CAP VALUE, RUSSELL 2000 INDEX, T.
ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
Each affected Portfolio has a fundamental investment restriction that limits
its investment in foreign securities. The Directors recommend that this
investment restriction be eliminated.
This restriction has not been adopted by other Portfolios of the Fund, and
the 1940 Act does not require that a mutual fund have a fundamental restriction
regarding investments in foreign securities. The Directors believe that the
elimination of this fundamental investment restriction will give each affected
Portfolio additional investment flexibility for purposes of pursuing its
investment objective. Certain of the affected Portfolios may be subject to
other restrictions, which are not fundamental, relating to investment in
foreign securities.
A Portfolio that invests in foreign securities may experience more rapid and
extreme changes in value than Portfolios that invest exclusively in securities
of U.S. issuers or securities that trade exclusively in U.S. markets. The
securities markets of many foreign countries are relatively small, with a
limited number of companies representing a small number of industries.
Additionally, issuers of foreign securities are usually not subject to the same
degree of regulation as U.S. issuers. Reporting, accounting and auditing
standards of foreign countries differ, in some cases significantly, from U.S.
issuer standards. Also, nationalization, expropriation or confiscatory
taxation, currency blockage and market disruption, political changes, security
suspensions or diplomatic developments could adversely affect a Portfolio's
investments in a foreign security.
27
III-I. REVISE FUNDAMENTAL INVESTMENT RESTRICTIONS RELATING TO COMMODITIES.
AFFECTED PORTFOLIOS: BLACKROCK AGGRESSIVE GROWTH, BLACKROCK DIVERSIFIED,
BLACKROCK INVESTMENT TRUST, BLACKROCK LARGE CAP VALUE, BLACKROCK STRATEGIC
VALUE, FI INTERNATIONAL STOCK, FI MID CAP OPPORTUNITIES, FRANKLIN TEMPLETON
SMALL CAP GROWTH, HARRIS OAKMARK LARGE CAP VALUE, LEHMAN BROTHERS AGGREGATE
BOND INDEX, METLIFE MID CAP STOCK INDEX, METLIFE STOCK INDEX, MORGAN STANLEY
EAFE INDEX, NEUBERGER BERMAN MID CAP VALUE, OPPENHEIMER GLOBAL EQUITY, RUSSELL
2000 INDEX, T. ROWE PRICE LARGE CAP GROWTH AND T. ROWE PRICE SMALL CAP GROWTH.
If this Proposal is approved, the fundamental investment restriction of each
affected Portfolio relating to investments in commodities will be revised as
set forth below:
The Portfolio may not purchase or sell commodities or commodity
contracts, except that, consistent with its investment policies, the
Portfolio may purchase and sell financial futures contracts and options and
may enter into swap agreements, foreign exchange contracts and other
financial transactions not requiring the delivery of physical commodities.
This proposed revised investment restriction is intended to simplify and
standardize the language of the affected Portfolio's policies concerning
commodities. In particular, the revised investment restriction makes clear that
the Portfolios may use various financial instruments (for example, futures
contracts) that may constitute commodities under the Commodity Exchange Act,
but which do not require the delivery of physical commodities.
A Portfolio's use of derivative instruments, such as options contracts,
futures contracts, options on futures contracts and swap agreements, involves
risks different from, or greater than, the risks associated with investing
directly in securities and other more traditional investments. The use of a
derivative instrument involves the risk that a loss may be sustained as a
result of the failure of another party to the contract to make required
payments or otherwise comply with the contract's terms. Liquidity risk exists
when a particular derivative instrument is difficult to purchase or sell. If a
derivative transaction is particularly large or if the relevant market is
illiquid, it may not be possible to initiate a transaction or liquidate a
position at an advantageous time or price. Because many derivatives have a
leverage component, adverse changes in the value or level of the underlying
asset, reference rate or index can result in a loss substantially greater than
the amount invested in the derivative itself.
Shareholder Voting Regarding Proposal to Change Fundamental Investment
______________________________________________________________________
Restrictions
____________
Each Met Series Fund Portfolio will vote separately from each other Met
Series Fund Portfolio with respect to its fundamental investment restrictions.
In addition, each proposed elimination of or change to a Met Series Fund
Portfolio's fundamental investment restrictions will be voted on separately
from the other changes or eliminations proposed for that Portfolio. No Proposal
to eliminate or change a fundamental investment restriction is contingent upon
the approval of any other such Proposal. Therefore, it may be the case that
some of a Met Series Fund Portfolio's fundamental investment restrictions will
be changed or eliminated as proposed and others will not.
28
For each Met Series Fund Portfolio, the required vote for approval of the
proposed elimination of or revisions to its fundamental investment restrictions
is the lesser of (1) 67% of the shares of the Portfolio represented at the
Meeting, or (2) more than 50% of the outstanding shares of that Portfolio. If
the required approval of a change to a fundamental investment restriction is
not obtained for a Met Series Fund Portfolio, that Portfolio's existing
restriction will continue in effect, and the Directors will consider such
alternative actions as may be in the best interests of the Portfolio.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS OF EACH MET
SERIES FUND PORTFOLIO VOTE FOR EACH PROPOSED ELIMINATION OR CHANGE TO THE
PORTFOLIO'S FUNDAMENTAL INVESTMENT RESTRICTIONS AS SET FORTH IN THIS PROPOSAL
III.
IV. GENERAL INFORMATION
This section provides certain information about the Fund, including
information about the Manager, the Fund's principal underwriter, independent
registered public accounting firm and executive officers and the identity of
persons, if any, holding more than 5% of the outstanding shares of any class of
any Portfolio.
Manager
_______
The Manager is a Delaware limited liability company. NELICO owns all of the
voting interests in the Manager. NELICO is a wholly owned subsidiary of
MetLife, which in turn is a wholly owned subsidiary of MetLife, Inc., a
publicly traded company. The members of the Manager include each Insurance
Company the separate accounts of which invest in registered investment
companies to which the Manager serves as investment adviser. The Chairman of
the Board and President of the Manager is Hugh C. McHaffie. Mr. McHaffie and
John F. Guthrie, Jr. are the members of the Manager's Board of Managers.
Mr. McHaffie is the Chairman of the Board, President and Chief Executive
Officer of the Fund, and his principal occupation is Senior Vice President of
MetLife. Mr. Guthrie is a Senior Vice President of the Fund, and his principal
occupations [are] Vice President of [MetLife and] NELICO. The address of the
Manager, NELICO, Mr. McHaffie and Mr. Guthrie is 501 Boylston Street, Boston,
Massachusetts 02116. The address of MetLife and MetLife, Inc. is [200 Park
Avenue, New York, New York 10166].
While the Manager provides administrative services to the Fund in its role
as investment adviser thereto, the Fund does not employ a separate
administrator.
29
Principal Underwriter
_____________________
MetLife is the Fund's principal underwriter.
Independent Registered Public Accounting Firm
_____________________________________________
Deloitte & Touche LLP (the "Independent Registered Public Accounting Firm"),
200 Berkeley Street, Boston, Massachusetts 02166, serves as the independent
registered public accounting firm for the Portfolios. Deloitte & Touche LLP
provides audit services, tax return review and assistance and consultation in
connection with review of SEC filings. Representatives of the Independent
Registered Public Accounting Firm will not be available at the Meeting.
The following tables set forth, for the Fund's two most recent fiscal years,
the fees billed by the Independent Registered Public Accounting Firm for
(a) all audit and non-audit services provided directly to the Fund and
(b) those non-audit services provided to the Manager and subadvisers (other
than subadvisers not affiliated with the Manager) and any entity controlling,
controlled by or under common control with the Manager that provides ongoing
services to the Fund (collectively, "Service Entities") that relate directly to
the Portfolios' operations and financial reports:
Fiscal Year Audit-Related All Other
Ended Audit Fees Fees Tax Fees Fees
----------- ---------- ------------- -------- ---------
2004 $660,970 $57,000 $66,971 $0
2005 $718,900 $41,000 $77,900 $0
"Audit Fees" represent fees billed for each of the last two fiscal years or
professional services rendered for the audit of the Fund's annual financial
statements for those fiscal years or services that are normally provided by the
accountant in connection with statutory or regulatory filings or engagements
for those fiscal years. "Audit-Related Fees" represent fees for services
rendered to the Fund (i) for security valuation testing in connection with the
Fund's semi-annual reports for the periods ended June 30, 2004 and June 30,
2005, respectively; and (ii) related to reorganizations involving certain
Portfolios of the Fund (in the case of (ii), such fees were paid by the
Manager). "Tax Fees" represent fees for services rendered to the Fund for tax
return preparation and review of and participation in determining required
income and capital gains distributions. "All Other Fees" represents fees, if
any, billed for other products and services rendered by the Independent
Registered Public Accounting Firm to the Fund for the last two fiscal years.
The Fund's Audit Committee has established pre-approval procedures pursuant
to paragraph (c)(7)(i)(B) of Rule 2-01 of Regulation S-X, which include regular
pre-approval procedures and interim pre-approval procedures. Under the regular
pre-approval procedures, the Audit Committee pre-approves at its regularly
scheduled meetings audit and non-audit services that are required to be
pre-approved under paragraph (c)(7) of Rule 2-01 of Regulation S-X. Under the
interim pre-approval procedures, any member of the Audit Committee who is an
Independent Director is authorized to pre-approve proposed services that arise
between regularly scheduled Audit
30
Committee meetings and that need to commence prior to the next regularly
scheduled Audit Committee meeting. Such Audit Committee member must report to
the Audit Committee at its next regularly scheduled meeting on the pre-approval
decision. There were no fees required to be approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X, which requires the audit committee
of a registered investment company to pre-approve certain non-audit services
provided to the registered investment company's investment adviser or its
affiliates.
For the Fund's two most recent fiscal years, the aggregate non-audit fees
billed by the Independent Registered Public Accounting Firm for services
rendered to the Fund and the Service Entities were as follows:
Aggregate
Fiscal Year Non-Audit Fees
----------- --------------
2004.................................... $ 9,845,411
2005.................................... $12,450,000
The amounts set out above represent the aggregate non-audit fees billed by
the Fund's accountant to MetLife, Inc. and its subsidiaries, and include, among
other non-audit fees, non-audit fees for services rendered to the Fund and
rendered to the Manager and any entity controlling, controlled by or under
common control with the Manager that provides ongoing services to the Fund.
The Fund's Audit Committee considered the provision of non-audit services
that were rendered to the Manager, and any entity controlling, controlled by or
under common control with the Manager that provides ongoing services to the
Fund that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01
of Regulation S-X and concluded that such services are compatible with
maintaining the Independent Registered Public Accounting Firm's independence.
31
Executive Officers
__________________
The following table provides information about the current executive
officers of the Fund, including their principal occupations, which, unless
specific dates are shown, are of more than five years' duration, although the
titles may not have been the same throughout.
CURRENT
POSITION(S) POSITION(S) PRINCIPAL OCCUPATIONS OVER PAST FIVE
NAME AND ADDRESS AGE WITH FUND HELD SINCE YEARS/ (1)/
- --------------------------------------- --- ----------- ----------- ---------------------------------------
Hugh C. McHaffie 46 Director, 2002 Senior Vice President (since 2000),
Metropolitan Life Insurance Company Chairman MetLife, MetLife Group, Inc. (since
501 Boylston Street of the 2003); Manager, Chair of the Board of
Boston, MA 02116 Board, Managers, President and Chief Executive
President Officer (since 2003), the Manager;
and Chief Senior Vice President (since 2005), The
Executive Travelers Insurance Company, The
Officer Travelers Life and Annuity Company,
Citicorp Life Insurance Company and
First Citicorp Life Insurance Company;
Director and President (since 2005),
CitiStreet Funds Management LLC;
formerly, Senior Vice President, Zenith
Fund**.
Jeffrey P. Halperin 38 Interim 2005 Assistant Vice President (since 2003),
Metropolitan Life Insurance Company Chief MetLife Group, Inc.; Assistant Vice
One MetLife Plaza Compliance President (since 2002), MetLife; Chief
27-01 Queens Plaza Officer Compliance Officer (since 2005),
North Long Island City, NY 11101 CitiStreet Funds Management LLC.
John F. Guthrie, Jr. 62 Senior Vice 2002 Manager and Senior Vice President
MetLife Advisers, LLC President (since [ ]), the Manager; Vice
501 Boylston Street President (since [ ]), MetLife; Vice
Boston, MA 02116 President (since [ ]), NELICO; Vice
President (since 2005), Met Investors
Advisory, LLC; Vice President (since
2005), CitiStreet Funds, Inc.; Vice
President (since 2005), CitiStreet
Funds Management LLC; formerly, Senior
Vice President, Zenith Fund**.
32
CURRENT
POSITION(S) POSITION(S) PRINCIPAL OCCUPATIONS OVER PAST FIVE
NAME AND ADDRESS AGE WITH FUND HELD SINCE YEARS/ (1)/
- --------------------------------------- --- ----------- ----------- ---------------------------------------
Alan C. Leland 54 Senior 2005 Treasurer and Chief Financial Officer
MetLife Advisers, LLC Vice (since [ ]), the Manager; Vice
501 Boylston Street President President (since 2004) and Treasurer
Boston, MA 02116 (since 2005), Met Investors Advisory,
LLC; Vice President (since 2003),
MetLife Group, Inc.; Vice President
(since [ ]), MetLife; Senior Vice
President (since [ ]), NELICO;
President (since 2005), CitiStreet
Funds, Inc.; Director and Vice
President (since 2005), CitiStreet
Funds Management, LLC; Assistant
Treasurer (since 2005), Travelers Asset
Management International Company LLC
and Travelers Investment Adviser, Inc.
Peter Duffy 50 Vice 2000 Senior Vice President (since 1998), the
MetLife Advisers, LLC President Manager; Senior Vice President (since
501 Boylston Street and [ ]), NELICO; Vice President (since
Boston, MA 02116 Treasurer [ ]), MetLife; Vice President (since
2005), Travelers Asset Management
International Company LLC and Travelers
Investment Adviser, Inc.; Treasurer and
Chief Financial Officer (since 2005),
Travelers Series Trust; Treasurer,
Chief Financial Officer and Chief
Accounting Officer (since 2005),
CitiStreet Funds, Inc.; formerly, Vice
President and Treasurer, Zenith Fund**.
Thomas M. Lenz 47 Vice 2002 General Counsel and Secretary (since
MetLife Advisers, LLC President 1998), the Manager; Assistant General
501 Boylston Street and Counsel (since [ ]), MetLife;
Boston, MA 02116 Secretary Secretary and Chief Legal Officer
(since 2005), CitiStreet Funds, Inc.;
formerly, Vice President and Secretary,
Zenith Fund**.
- --------
** Following the sale of all of its assets to the Fund on May 1, 2003, the
Zenith Fund deregistered as an investment company with the SEC on
January 29, 2004.
(1) Positions during the past five years with the Fund, MetLife, the Manager,
Zenith Fund, NELICO or New England Securities Corporation are omitted if
not materially different.
33
Certain Affiliations
____________________
The following table lists the positions held by the Fund's officers and any
Director or Nominee who is an "interested person" of the Fund with affiliated
persons or principal underwriter of the Fund:
NAME POSITIONS HELD WITH AFFILIATED PERSONS OR PRINCIPAL UNDERWRITER OF THE FUND
- -------------------- -----------------------------------------------------------------------------------------------------------
Hugh C. McHaffie Senior Vice President, MetLife; Chair of the Board of Managers, President and Chief Executive Officer,
the Manager, and Director and President, CitiStreet Funds Management LLC.
Jeffrey P. Halperin Assistant Vice President, MetLife Group, Inc.; Assistant Vice President, MetLife, and Chief Compliance
Officer, CitiStreet Funds Management LLC.
John F. Guthrie, Jr. Manager and Senior Vice President, the Manager; Vice President, MetLife; Vice President, NELICO; Vice
President, Met Investors Advisory, LLC; Vice President, CitiStreet Funds, Inc. and Vice President,
CitiStreet Funds Management LLC.
Alan C. Leland Treasurer and Chief Financial Officer, the Manager; Vice President and Treasurer, Met Investors
Advisory, LLC; Vice President, MetLife Group, Inc.; Vice President, MetLife; Senior Vice President,
NELICO; President, CitiStreet Funds, Inc; Director and Vice President, CitiStreet Funds Management
LLC; Assistant Treasurer, Travelers Asset Management International Company LLC and Travelers
Investment Adviser, Inc.
Peter Duffy Senior Vice President, the Manager; Senior Vice President; NELICO; Vice President, MetLife; Vice
President, Travelers Asset Management International Company LLC and Travelers Investment Adviser,
Inc.; Treasurer and Chief Financial Officer, Travelers Series Trust; and Treasurer, Chief Financial Officer
and Chief Accounting Officer, CitiStreet Funds, Inc.
Thomas M. Lenz General Counsel and Secretary, the Manager; Assistant General Counsel, MetLife; and Secretary and
Chief Legal Officer, CitiStreet Funds, Inc.
Ownership of Shares
___________________
See Appendix D for the number of shares of each Portfolio outstanding and
entitled to vote on the relevant Proposals as of the Record Date.
All of the shares of the Portfolios are held of record by the Insurance
Companies for allocation to the corresponding investment divisions or
sub-accounts of certain of their separate accounts. Shares of the Portfolios
are not offered for direct purchase by the investing public.
Beneficial Ownership
____________________
[The Insurance Companies have informed the Fund that there were no persons
owning Contracts that would entitle them to instruct the Insurance Companies
with respect to 5% or more of any class of the voting securities of any
Portfolio as of the Record Date.]
[The Fund has been informed that, as of the Record Date, with respect to
each Portfolio, the Fund's officers and Directors, individually and as a group,
owned less than 1% of the outstanding shares of such Portfolio.]
Because the Insurance Companies own 100% of the shares of the Fund, they may
be deemed to be in control (as that term is defined in the 1940 Act) of the
Fund.
Additional information about the Fund
_____________________________________
You may obtain copies of the Fund's annual report for the fiscal year ended
December 31, 2005 or ask any questions you may have regarding this Proxy
Statement without charge by calling (800) 638-7732 or by writing to the
Secretary of the Fund at 501 Boylston Street, Boston, Massachusetts 02116.
34
Regulatory and Litigation Matters
_________________________________
Regulatory bodies have contacted the Manager and certain other affiliates of
MetLife and have requested information relating to market timing and late
trading of mutual funds and variable annuity insurance products and, generally,
the marketing of products. MetLife believes that many of these inquires are
similar to those made to many financial service companies as part of
industry-wide investigations by various regulatory agencies. MetLife at the
present time is not aware of any systemic problems with respect to such matters
that may have a material adverse effect on MetLife, Inc.'s consolidated
financial position. The SEC has commenced an investigation with respect to
market timing and late trading in a limited number of privately-placed variable
insurance contracts that were sold through General American Life Insurance
Company ("General American"). In May 2004, General American received a
so-called "Wells Notice" stating that the SEC staff is considering recommending
that the SEC bring a civil action alleging violations of the U.S. securities
laws against General American. Under the SEC procedures, General American can
avail itself of the opportunity to respond to the SEC staff before it makes a
formal recommendation regarding whether any action alleging violations of the
U.S. securities laws should be considered. General American has responded to
the Wells Notice. MetLife is fully cooperating with regard to these information
requests and investigations. MetLife has also advised the Fund's Directors
that, while certain exceptions to the Fund's policies have been noted, no
situations have been identified that would have a material impact on the
financial position of the Fund.
V. INFORMATION ABOUT VOTING INSTRUCTIONS AND CONDUCT OF THE MEETING
Solicitation of Voting Instructions
___________________________________
Voting instructions will be solicited primarily by mailing this Proxy
Statement and its enclosures, but voting instructions may also be solicited
through further mailings, telephone calls, personal interviews or e-mail by
officers of the Fund or by its agents. [The Fund has retained [ ] to aid
in the solicitation of proxies (which is estimated to cost approximately
[ ]).] MetLife will bear the portion of costs of the Meeting (including
solicitation costs) relating to Proposal II. The remaining portion of the costs
of the Meeting will be borne by the Fund.
Voting Process
______________
The shares of the Portfolios are currently sold to the Insurance Companies
as the record owners for allocation to the corresponding investment divisions
or sub-accounts of certain of their separate accounts that are registered as
investment companies with the SEC. As mentioned at the beginning of this Proxy
Statement, most of the shares of the Portfolios are attributable to Contracts
issued by the Insurance Companies. Other outstanding Portfolio shares are not
attributable to Contracts, because such shares are (a) held in a separate
account that is not registered as an investment company or (b) held in an
Insurance Company's general account rather than in a separate account.
35
Record owners of the shares of the Portfolios as of the Record Date will be
entitled to vote and may cast one vote for each share held. A majority of the
shares of the Portfolios outstanding as of the Record Date, present in person
or represented by proxy, constitutes a quorum for the transaction of business
by the shareholders of the Portfolios at the Meeting.
In determining whether a quorum is present, the tellers (persons appointed
by the Fund to receive, count and report all ballots cast at the Meeting) will
count shares represented by proxies that reflect abstentions, and "broker
non-votes," as shares that are present and entitled to vote. With respect to
each Proposal other than Proposal I, these shares will be counted as present,
but not as voting in-favor of any such Proposal, thus these shares will have
the same effect as if they cast votes against such Proposal. With respect to
Proposal I, so long as a quorum is present, neither abstentions nor broker
non-votes will have any effect on the outcome of such Proposal. "Broker
non-votes" are shares held by brokers or nominees as to which (i) the broker or
nominee does not have discretionary voting power and (ii) the broker or nominee
has not received instructions from the beneficial owner or other person who is
entitled to instruct how the shares will be voted.
In accordance with their understanding of presently applicable law, the
Insurance Companies will vote the shares of the Portfolios that are
attributable to the Contracts based on instructions received from owners of
such Contracts that participate in the corresponding investment divisions in
the separate accounts. The number of the Portfolios' shares held in the
corresponding investment division of a separate account deemed attributable to
each Contract Owner is determined by dividing a variable life insurance
policy's or variable benefit option's cash value or a variable annuity
contract's accumulation units (or if variable annuity payments are currently
being made, the amount of the relevant Insurance Company's reserves
attributable to that variable annuity contract), as the case may be, in that
division by the net asset value of one share in the Portfolio.
The Portfolios currently issue Class A shares, Class B shares and Class E
shares, which, among other things, have different net asset values. Whether a
Portfolio's Class A shares, Class B shares or Class E shares are offered in
connection with a given Contract depends on the particular Contract. Each
Class A, Class B and Class E share of a Portfolio has one vote. For purposes of
determining the number of shares of a Portfolio for which a Contract Owner is
entitled to give voting instructions, the Insurance Companies use the per share
net asset value for such class of such Portfolio's shares that are offered
under the relevant Contract. Fractional votes will be counted. The number of
shares for which a Contract Owner has a right to give voting instructions is
determined as of the Record Date.
Portfolio shares held in an investment division attributable to Contracts or
which no timely instructions are received or that are not attributable to
Contracts will be represented at the Meeting by the record owners and voted in
the same proportion as the shares for which voting instructions are received
for all Contracts participating in that
36
investment division. The Fund has been advised that Portfolio shares held in
the general account or unregistered separate accounts of the Insurance
Companies will be represented at the Meeting by the record owners and voted in
the same proportion as the aggregate of (i) the shares for which voting
instructions are received and (ii) the other shares that are voted in
proportion to such voting instructions.
If an enclosed voting instruction form is completed, executed and returned,
it may nevertheless be revoked at any time before the Meeting by a written
revocation or later voting instruction form.
Adjournments; Other Business
____________________________
With respect to each Portfolio, an adjournment of the Meeting requires the
affirmative vote of a majority of the total number of shares of that Portfolio
that are present in person or by proxy. The Meeting has been called to transact
any business that properly comes before it. The only business that management
of the Fund intends to present or knows that others will present are the
Proposals. If any other matters properly come before the Meeting, and on all
matters incidental to the conduct of the Meeting, the persons named as proxies
intend to vote the proxies in accordance with their judgment, unless the
Secretary of the Fund has previously received written contrary instructions
from the shareholder entitled to vote the shares.
Shareholder Proposals at Future Meetings
________________________________________
The Fund's Bylaws require an annual meeting of shareholders only in years in
which the election of Directors is required to be acted upon by the 1940 Act.
Shareholder proposals to be presented at any future meeting of shareholders of
the Portfolio or the Fund must be received by the Fund within a reasonable time
before the Fund solicits proxies for that meeting in order to be considered for
inclusion in the proxy materials for that meeting.
37
APPENDIX A
METROPOLITAN SERIES FUND, INC.
NOMINATING COMMITTEE CHARTER
1. The respective Nominating Committee (each, a "Committee") of each of the
Metropolitan Series Fund, Inc. and Metropolitan Series Fund II (each, a
"Fund") shall be composed entirely of directors/trustees ("Directors") of
the relevant Fund who are not "interested persons" of such Fund for
purposes of the Investment Company Act of 1940, as amended ("Independent
Directors"). Each Committee's overall role is to assist its Fund's Board of
Directors/Trustees (a "Board") with the selection of Independent Director
candidates as follows.
2. The specific purpose of each Committee is to evaluate the qualifications of
its Fund's candidates for Independent Director positions and to make
recommendations to the Independent Directors with respect to nominations
for Independent Director membership on its Fund's Board. Each Committee
shall consider Independent Director candidates in connection with Board
vacancies and newly created Board positions.
3. Each Committee shall require that Independent Director candidates have a
college degree or equivalent business experience. The Committee may take
into account a wide variety of factors in considering Independent Director
candidates, including (but not limited to): (i) availability and commitment
of a candidate to attend meetings and perform his or her responsibilities
on the relevant Fund's Board, (ii) relevant industry and related
experience, (iii) educational background, (iv) ability, judgment and
expertise and (v) overall diversity of the relevant Board's composition.
4. In identifying potential nominees for its Fund's Board, each Committee may
consider candidates recommended by the following sources: (i) its Fund's
current Directors; (ii) its Fund's officers; (iii) its Fund's investment
adviser, subadvisers or principal underwriters; (iv) in the case of
Metropolitan Series Fund, Inc., owners of variable life insurance and
variable annuity contracts ("Contract Owners") issued by SEC-registered
separate accounts of Metropolitan Life Insurance Company or its affiliated
insurance companies (the "Insurance Companies") that invest in such Fund
(see below); (v) in the case of Metropolitan Series Fund II, shareholders
("Shareholders") of such Fund (see below); and (vi) any other source such
Committee deems to be appropriate. Each Committee may, but is not required
to, retain a third party search firm or other consultant or adviser at the
relevant Fund's expense to identify or assist in the evaluation of
potential candidates.
A-1
5. Each Committee will consider and evaluate nominee candidates properly
submitted by Contract Owners and Shareholders as it considers and evaluates
candidates recommended by other sources. Appendix A to this Charter, as it
may be amended from time to time by each Committee, sets forth procedures
that must be followed by Contract Owners and Shareholders to properly
submit a nominee candidate to the relevant Committee (recommendations not
properly submitted in accordance with Appendix A will not be considered by
such Committee).
6. Each Committee will recommend to its Fund's Independent Directors
candidates to serve as Independent Directors on such Board.
7. To carry out its purposes, each Committee shall:
(a) hold scheduled meetings when the Committee or its Fund's Board
determines necessary or appropriate in accordance with such Fund's
Bylaws;
(b) submit minutes of Committee meetings to its respective Board; and
8. Each Committee shall have the resources and authority appropriate to
discharge its responsibilities, including authority to retain special
counsel and other experts or consultants at the expense of the appropriate
Fund.
9. Each Fund's Board may designate one member of its respective Committee to
serve as Chair of such Committee. Each Committee may make recommendations
to its Fund's full Board regarding the designation of Committee Chair.
Adopted: August 4, 2004
A-2
PROCEDURES BY WHICH CONTRACT OWNERS AND SHAREHOLDERS MAY
COMMUNICATE WITH THE BOARD OF DIRECTORS/TRUSTEES
(As of August 4, 2004)
A Contract Owner of Metropolitan Series Fund, Inc. or a Shareholder of
Metropolitan Series Fund II must follow the following procedures in order to
submit properly a nominee recommendation for the consideration of such Fund's
Nominating Committee.
1. The Contract Owner or Shareholder must submit any such recommendation
(each, a "Recommendation," and, collectively, the "Recommendations")
in writing to the Fund, to the attention of the Secretary of the Fund
("Secretary"), at the address of the principal executive offices of
the Fund. Once each quarter, if any Recommendations have been received
by the Secretary during the quarter, the Secretary will inform the
relevant Committee of the new Recommendations. Because the Funds do
not hold annual or other regular meetings of shareholders for the
purpose of electing Directors, each Committee will accept
Recommendations on a continuous basis.
2. All Recommendations properly submitted to the Fund will be held by the
Secretary until such time as the Committee convenes to consider
Independent Director candidates to fill Board vacancies or newly
created Board positions (an "Independent Director Consideration
Meeting") or the Committee instructs the Secretary to discard a
Recommendation following an Independent Director Consideration Meeting
or an Interim Evaluation (as defined below), PROVIDED, HOWEVER, that
in no event shall the Secretary hold any Recommendation for longer
than three (3) years.
3. At an Independent Director Consideration Meeting, the Committee will
consider each Recommendation then held by the Secretary. Following an
Independent Director Consideration Meeting, the Committee may instruct
the Secretary to discard any or all of the Recommendations currently
held by the Secretary.
4. The Committee may, in its discretion and at any time, convene to
conduct an evaluation of validly submitted Recommendations (each such
meeting, an "Interim Evaluation") for the purpose of determining which
Recommendations will be considered at the next Independent Director
Consideration Meeting. Following an Interim Evaluation, the Committee
may instruct the Secretary to discard any or all of the
Recommendations currently held by the Secretary.
5. The Recommendation must include: (i) a statement in writing setting
forth (A) the name, age, date of birth, business address, residence
address and nationality of the person recommended by the Contract
Owner or Shareholder (the "candidate"); (B) in the case of
Metropolitan Series Fund II, the number of shares, if any, of each
Portfolio (and class) of such Fund owned of record
A-3
or beneficially by the candidate, as reported to such Shareholder by
the candidate; (C) in the case of Metropolitan Series Fund, Inc., the
number of units that relate to shares of each Portfolio (and class) of
such Fund attributable to any annuity or life insurance contract of
the candidate, as reported to such Contract Owner by the candidate;
(D) any other information regarding the candidate called for with
respect to director nominees by paragraphs (a), (d), (e) and (f) of
Item 401 of Regulation S-K or paragraph (b) of Item 22 of Rule 14a-101
(Schedule 14A) under the Securities Exchange Act of 1934, as amended
(the "Exchange Act") (or the corresponding provisions of any
regulation or rule subsequently adopted by the Securities and Exchange
Commission or any successor agency applicable to the Fund); (E) any
other information regarding the candidate that would be required to be
disclosed if the candidate were a nominee in a proxy statement or
other filing required to be made in connection with the election of
Independent Directors pursuant to Section 14 of the Exchange Act and
the rules and regulations promulgated thereunder; and (F) information
regarding the candidate that will be sufficient for the Fund to make a
determination as to whether the candidate is or will be an "interested
person" of the Fund (as defined in the Investment Company Act of 1940,
as amended); (ii) the written and signed consent of the candidate to
be named as a nominee and to serve as an Independent Director if
elected; (iii) in the case of Metropolitan Series Fund II, the name of
the recommending Shareholder as it appears on such Fund's books, or,
in the case of Metropolitan Series Fund, Inc., the name of the
recommending Contract Owner as it appears on the books of the relevant
Insurance Company separate account; (iv) in the case of Metropolitan
Series Fund II, the number of shares of each Portfolio (and class) of
such Fund owned beneficially and of record by the recommending
Shareholder; (v) in the case of Metropolitan Series Fund, Inc., the
number of units that relate to shares of each Portfolio (and class) of
such Fund attributable to any annuity or life insurance contract of
such recommending Contract Owner; and (vi) a description of all
arrangements or understandings between the recommending Shareholder or
Contract Owner and the candidate and any other person or persons
(including their names) pursuant to which the Recommendation is being
made by the recommending Shareholder or Contract Owner. In addition,
the Committee may require the candidate to furnish such other
information as it may reasonably require or deem necessary to
determine the eligibility of such candidate to serve on the Board or
to satisfy applicable law.
A-4
APPENDIX B
FORM OF ADVISORY AGREEMENT
AMENDMENT NO. 1
TO THE
ADVISORY AGREEMENT
(MFS TOTAL RETURN PORTFOLIO)
AMENDMENT made this 1st day of May, 2006 to the Advisory Agreement dated the
1st day of May, 2003 (the "Agreement"), by and between METROPOLITAN SERIES
FUND, INC., a Maryland corporation (the "Fund"), with respect to its MFS Total
Return Portfolio (the "Portfolio"), and METLIFE ADVISERS, LLC, a Delaware
limited liability company (the "Manager"). In consideration of the mutual
covenants contained herein, the parties agree as follows:
1. CHANGE TO COMPENSATION OF THE MANAGER
Pursuant to Paragraph 11 of the Agreement, the compensation of the Manager
referenced in Paragraph 7, which contains the schedule of fees, is hereby
amended as follows:
7. As full compensation for all services rendered, facilities furnished and
expenses borne by the Manager hereunder, the Fund shall pay the Manager
compensation at the annual rate of 0.60% of the first $250 million of the
Portfolio's average daily net assets, 0.55% on the next $500 million of such
assets and 0.50% of such assets in excess of $750 million. Such compensation
shall be payable monthly in arrears or at such other intervals, not less
frequently than quarterly, as the Board of Directors of the Fund may from time
to time determine and specify in writing to the Manager. The Manager hereby
acknowledges that the Fund's obligation to pay such compensation is binding
only on the assets and property belonging to the Portfolio.
2. ADVISORY AGREEMENT
In all other respects, the Agreement is confirmed and remains in full force
and effect.
3. EFFECTIVE DATE
This Amendment shall become effective as of the date of this Amendment.
B-1
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
METROPOLITAN SERIES FUND, INC., METLIFE ADVISERS, LLC
on behalf of its MFS Total Return
Portfolio
By: By:
------------------------------- --------------------------------
John F. Guthrie, Jr. John F. Guthrie, Jr.
Senior Vice President Senior Vice President
B-2
ADVISORY AGREEMENT
(MFS TOTAL RETURN PORTFOLIO)
AGREEMENT entered into on the 1st day of May, 2003 by and between
METROPOLITAN SERIES FUND, INC., a Maryland corporation (the "Fund"), with
respect to its MFS Total Return Portfolio (the "Portfolio"), and METLIFE
ADVISERS, LLC, a Delaware limited liability company (the "Manager").
WITNESSETH:
WHEREAS, the Fund and the Manager wish to enter into an agreement setting
forth the terms upon which the Manager (or certain other parties acting
pursuant to delegation from the Manager) will perform certain services for the
Portfolio;
NOW THEREFORE, in consideration of the premises and covenants hereinafter
contained, the parties agree as follows:
1.(a) The Fund hereby employs the Manager to furnish the Fund with Portfolio
Management Services (as defined in Section 2 hereof) and Administrative
Services (as defined in Section 3 hereof), subject to the authority of the
Manager to delegate any or all of its responsibilities hereunder to other
parties as provided in Sections 1(b) and (c) hereof. The Manager hereby accepts
such employment and agrees, at its own expense, to furnish such services
(either directly or pursuant to delegation to other parties as permitted by
Sections 1(b) and (c) hereof) and to assume the obligations herein set forth,
for the compensation herein provided. The Manager shall, unless otherwise
expressly provided or authorized, have no authority to act for or represent the
Fund in any way or otherwise be deemed an agent of the Fund.
(b) The Manager may delegate any or all of its responsibilities hereunder
with respect to the provision of Portfolio Management Services (and assumption
of related expenses) to one or more other parties (each such party, a
"Sub-Adviser"), pursuant in each case to a written agreement with such
Sub-Adviser that meets the requirements of Section 15 of the Investment Company
Act of 1940 and the rules thereunder (the "1940 Act") applicable to contracts
for service as investment adviser of a registered investment company (including
without limitation the requirements for approval by the directors of the Fund
and the shareholders of the Portfolio), subject, however, to such exemptions as
may be granted by the Securities and Exchange Commission. Any Sub-Adviser may
(but need not) be affiliated with the Manager. If different Sub-Advisers are
engaged to provide Portfolio Management Services with respect to different
segments of the Portfolio, the Manager shall determine, in the manner described
in the prospectus of the Portfolio from time to time in effect, what portion of
the assets belonging to the Portfolio shall be managed by each Sub-Adviser.
B-3
c) The Manager may delegate any or all of its responsibilities hereunder
with respect to the provision of Administrative Services to one or more other
parties (each such party, an "Administrator") selected by the Manager. Any
Administrator may (but need not) be affiliated with the Manager.
2. As used in this Agreement, "Portfolio Management Services" means
management of the investment and reinvestment of the assets belonging to the
Portfolio, consisting specifically of the following:
(a) obtaining and evaluating such economic, statistical and financial
data and information and undertaking such additional investment research as
shall be necessary or advisable for the management of the investment and
reinvestment of the assets belonging to the Portfolio in accordance with the
Portfolio's investment objectives and policies;
(b) taking such steps as are necessary to implement the investment
policies of the Portfolio by purchasing and selling of securities, including
the placing of orders for such purchase and sale; and
(c) regularly reporting to the Board of Directors of the Fund with
respect to the implementation of the investment policies of the Portfolio.
3. As used in this Agreement, "Administrative Services" means the provision
to the Fund, by or at the expense of the Manager, of the following:
(a) office space in such place or places as may be agreed upon from time
to time by the Fund and the Manager, and all necessary office supplies,
facilities and equipment;
(b) necessary executive and other personnel for managing the affairs of
the Portfolio, including personnel to perform clerical, bookkeeping,
accounting, stenographic and other office functions (exclusive of those
related to and to be performed under contract for custodial, transfer,
dividend and plan agency services by the entity or entities selected to
perform such services);
(c) compensation, if any, of directors of the Fund who are directors,
officers or employees of the Manager, any Sub-Adviser or any Administrator
or of any affiliated person (other than a registered investment company) of
the Manager, any Sub-Adviser or any Administrator;
(d) all services, other than services of counsel, required in connection
with the preparation of registration statements and prospectuses, including
amendments and revisions thereto, all annual, semiannual and periodic
reports, and notices and proxy solicitation material furnished to
shareholders of the Fund or regulatory authorities, to the extent that any
such materials relate to the business of the Portfolio, to the shareholders
thereof or otherwise to the Portfolio, the Portfolio to be treated for these
purposes as a separate legal entity and fund; and
B-4
(e) supervision and oversight of the Portfolio Management Services
provided by each Sub-Adviser, and oversight of all matters relating to
compliance by the Fund with applicable laws and with the Fund's investment
policies, restrictions and guidelines, if the Manager has delegated to one
or more Sub-Advisers any or all of its responsibilities hereunder with
respect to the provision of Portfolio Management Services.
4. Nothing in section 3 hereof shall require the Manager to bear, or to
reimburse the Fund for:
(a) any of the costs of printing and mailing the items referred to in
sub-section (d) of this section 3;
(b) any of the costs of preparing, printing and distributing sales
literature;
(c) compensation of directors of the Fund who are not directors, officers
or employees of the Manager, any Sub-Adviser or any Administrator or of any
affiliated person (other than a registered investment company) of the
Manager, any Sub-Adviser or any Administrator;
(d) registration, filing and other fees in connection with requirements
of regulatory authorities;
(e) the charges and expenses of any entity appointed by the Fund for
custodial, paying agent, shareholder servicing and plan agent services;
(f) charges and expenses of independent accountants retained by the Fund;
(g) charges and expenses of any transfer agents and registrars appointed
by the Fund;
(h) brokers' commissions and issue and transfer taxes chargeable to the
Fund in connection with securities transactions to which the Fund is a party;
(i) taxes and fees payable by the Fund to federal, state or other
governmental agencies;
(j) any cost of certificates representing shares of the Fund;
(k) legal fees and expenses in connection with the affairs of the Fund
including registering and qualifying its shares with Federal and State
regulatory authorities;
B-5
(l) expenses of meetings of shareholders and directors of the Fund; and
(m) interest, including interest on borrowings by the Fund.
5. All activities undertaken by the Manager or any Sub-Adviser or
Administrator pursuant to this Agreement shall at all times be subject to the
supervision and control of the Board of Directors of the Fund, any duly
constituted committee thereof or any officer of the Fund acting pursuant to
like authority.
6. The services to be provided by the Manager and any Sub-Adviser or
Administrator hereunder are not to be deemed exclusive and the Manager and any
Sub-Adviser or Administrator shall be free to render similar services to
others, so long as its services hereunder are not impaired thereby.
7. As full compensation for all services rendered, facilities furnished and
expenses borne by the Manager hereunder, the Fund shall pay the Manager
compensation at the annual rate of .50% of average net assets. Such
compensation shall be payable monthly in arrears or at such other intervals,
not less frequently than quarterly, as the Board of Directors of the Fund may
from time to time determine and specify in writing to the Manager. The Manager
hereby acknowledges that the Fund's obligation to pay such compensation is
binding only on the assets and property belonging to the Portfolio.
8. If the total of all ordinary business expenses of the Fund as a whole
(including investment advisory fees but excluding taxes and portfolio brokerage
commissions) for any fiscal year exceeds the lowest applicable percentage of
average net assets or income limitations prescribed by any state in which
shares of the Portfolio are qualified for sale, the Manager shall pay such
excess. Solely for purposes of applying such limitations in accordance with the
foregoing sentence, the Portfolio and the Fund shall each be deemed to be a
separate fund subject to such limitations. Should the applicable state
limitation provisions fail to specify how the average net assets of the Fund or
belonging to the Portfolio are to be calculated, that figure shall be
calculated by reference to the average daily net assets of the Fund or the
Portfolio, as the case may be.
9. It is understood that any of the shareholders, directors, officers,
employees and agents of the Fund may be a shareholder, director, officer,
employee or agent of, or be otherwise interested in, the Manager, any
affiliated person of the Manager, any organization in which the Manager may
have an interest or any organization which may have an interest in the Manager;
that the Manager, any such affiliated person or any such organization may have
an interest in the Fund; and that the existence of any such dual interest shall
not affect the validity hereof or of any transactions hereunder except as
otherwise provided in the articles of incorporation of the Fund, the limited
liability company agreement of the Manager or specific provisions of applicable
law.
10. This Agreement shall become effective as of the date of its execution,
and
B-6
(a) unless otherwise terminated, this Agreement shall continue in effect
for two years from the date of execution, and from year to year thereafter
so long as such continuance is specifically approved at least annually
(i) by the Board of Directors of the Fund or by vote of a majority of the
outstanding voting securities of the Portfolio, and (ii) by vote of a
majority of the directors of the Fund who are not interested persons of the
Fund or the Manager, cast in person at a meeting called for the purpose of
voting on, such approval;
(b) this Agreement may at any time be terminated on sixty days' written
notice to the Manager either by vote of the Board of Directors of the Fund
or by vote of a majority of the outstanding voting securities of the
Portfolio;
(c) this Agreement shall automatically terminate in the event of its
assignment;
(d) this Agreement may be terminated by the Manager on ninety days'
written notice to the Fund;
Termination of this Agreement pursuant to this section 10 shall be without
the payment of any penalty.
11. This Agreement may be amended at any time by mutual consent of the
parties, provided that, if required by law (as may be modified by any
exemptions received by the Manager), such consent on the part of the Fund shall
have been approved by vote of a majority of the outstanding voting securities
of the Portfolio and by vote of a majority of the directors of the Fund who are
not interested persons of the Fund or the Manager, cast in person at a meeting
called for the purpose of voting on such approval.
12. For the purpose of this Agreement, the terms "vote of a majority of the
outstanding voting securities," "interested person," "affiliated person" and
"assignment" shall have their respective meanings defined in the 1940 Act,
subject, however, to such exemptions as may be granted by the Securities and
Exchange Commission under the 1940 Act. References in this Agreement to any
assets, property or liabilities "belonging to" the Portfolio shall have the
meaning defined in the Fund's articles of incorporation as amended from time to
time.
13. In the absence of willful misfeasance, bad faith or gross negligence on
the part of the Manager, or reckless disregard of its obligations and duties
hereunder, the Manager shall not be subject to any liability to the Fund, to
any shareholder of the Fund or to any other person, firm or organization, for
any act or omission in the course of, or connected with, rendering services
hereunder.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
B-7
METROPOLITAN SERIES FUND, INC., METLIFE ADVISERS, LLC
on behalf of its MFS Total Return
Portfolio
By: By:
------------------------------- --------------------------------
John F. Guthrie, Jr. John F. Guthrie, Jr.
Senior Vice President Senior Vice President
B-8
Appendix C
CURRENT AND PROPOSED CHANGES TO FUNDAMENTAL INVESTMENT RESTRICTIONS
Set out in the left hand column of the table below are the current
fundamental investment restrictions for each Portfolio that are proposed to be
changed or eliminated as described in this Proxy Statement. The right hand
column sets out the proposed changes to the fundamental investment
restrictions. The Portfolio listing below will help you more easily find in the
Appendix the changes proposed for your Portfolio. Each Portfolio may borrow for
temporary administrative purposes under each Portfolio's current borrowing and
senior securities fundamental investment restrictions set out below. To the
extent that borrowings for temporary administrative purposes exceeds 5% of the
total assets of each such Fund, such excess shall be subject to the 300% asset
coverage requirement set forth in the Portfolio's current borrowing restriction
below.
PORTFOLIO PAGE NO.
- --------------------------------------------------------------------- --------
BlackRock Aggressive Growth........................................... C-2
BlackRock Diversified................................................. C-8
BlackRock Investment Trust............................................ C-2
BlackRock Large Cap Value............................................. C-5
BlackRock Strategic Value............................................. C-5
FI International Stock................................................ C-11
FI Mid Cap Opportunities.............................................. C-14
Franklin Templeton Small Cap Growth................................... C-17
Harris Oakmark Large Cap Value........................................ C-20
Lehman Brothers Aggregate Bond Index.................................. C-23
MetLife Mid Cap Stock Index........................................... C-38
MetLife Stock Index................................................... C-26
Morgan Stanley EAFE Index............................................. C-29
Neuberger Berman Mid Cap Value........................................ C-32
Oppenheimer Global Equity............................................. C-34
Russell 2000 Index.................................................... C-38
T. Rowe Price Large Cap Growth........................................ C-41
T. Rowe Price Small Cap Growth........................................ C-44
C-1
BLACKROCK AGGRESSIVE GROWTH AND BLACKROCK INVESTMENT TRUST
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of 20%
of total assets.
C-2
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries. For
purposes of the application of this
restriction, companies engaged in the
business of financing may be
classified according to the
industries of their parent or sponsor
companies, or industries that
otherwise most affect the financing
companies.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 10% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")) except
that 25% of total assets may be
invested in securities issued,
assumed, or guaranteed by foreign
governments or their political
subdivisions or instrumentalities;
assumed or guaranteed by domestic
issuers; or issued, assumed, or
guaranteed by foreign issuers with a
class of securities listed on NYSE.
C-3
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy); and
(iii) sell covered call options on
and purchase put and call options
contracts on futures contracts (on
recognized futures exchanges) of the
type and for the same reasons the
Portfolio is permitted to enter
futures contracts (other than the
requirement that the Portfolio be
permitted to enter into futures
contracts, this policy in (iii) is
non-fundamental). The policies in
(i) and (iii) above are permitted
only if either (a) the sum of the
initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission (the "CFTC")). The
policies in (ii) above are permitted
so long as the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-4
BLACKROCK STRATEGIC VALUE AND BLACKROCK LARGE CAP VALUE
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income.
C-5
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33 % of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries. For
purposes of the application of this
restriction, companies engaged in the
business of financing may be
classified according to the
industries of their parent or sponsor
companies, or industries that
otherwise most affect the financing
companies.
C-6
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities;
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-7
BLACKROCK DIVERSIFIED
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of 20%
of total assets.
C-8
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries. For
purposes of the application of this
restriction, companies engaged in the
business of financing may be
classified according to the
industries of their parent or sponsor
companies, or industries that
otherwise most affect the financing
companies. Also, the 25% limitation
above shall not apply to the
Portfolio's (a) money market
securities, securities issued or
guaranteed by the U.S. government,
its agencies or instrumentalities and
(b) bank issued debt securities.
C-9
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 10% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")) except
that 25% of total assets may be
invested in securities issued,
assumed, or guaranteed by foreign
governments or their political
subdivisions or instrumentalities;
assumed or guaranteed by domestic
issuers; or issued, assumed, or
guaranteed by foreign issuers with a
class of securities listed on NYSE.
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may (i) contracts, except that, consistent
as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities;
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy); and (iii)
sell covered call options on and
purchase put and call options
contracts on futures contracts (on
recognized futures exchanges) of the
type and for the same reasons the
Portfolio is permitted to enter
futures contracts (other than the
requirement that the Portfolio be
permitted to enter into futures
contracts, this policy in (iii) is
non-fundamental). The policies in (i)
and (iii) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or (b)
the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii)
above are permitted so long as the
sum of the initial margin for futures
and options sold on futures, plus
premiums paid for unexpired options
on futures does not exceed 5% of
total assets (excluding "in the
money" and "bona fide hedging" as
defined by the CFTC).
C-10
FI INTERNATIONAL STOCK PORTFOLIO:
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income.
C-11
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of 20%
of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
C-12
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-13
FI MID CAP OPPORTUNITIES:
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income.
C-14
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of 25%
of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 30% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs"))
denominated in a foreign currency and
not publicly traded in the U.S.
C-15
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-16
FRANKLIN TEMPLETON SMALL CAP GROWTH
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. Sell put options other than
to close out option positions
previously entered into; provided
that the Portfolio may sell covered
put options on securities and stock
indices to earn additional income, as
a hedge against or to minimize
anticipated loss in value.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of 20%
of total assets.
C-17
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 25% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")).
C-18
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-19
HARRIS OAKMARK LARGE CAP VALUE:
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
C-20
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 25% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")).
C-21
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not Invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; and (ii) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(ii) is non-fundamental). The
policies in (i) and (ii) above are
permitted only if either (a) the sum
of the initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission). The Portfolio's
policy to not purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return is a
non-fundamental policy.
C-22
LEHMAN BROTHERS AGGREGATE BOND INDEX
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3 % of total assets.
C-23
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries. For
purposes of application of this
restriction, companies engaged in the
business of financing may be
classified according to the
industries of their parent or sponsor
companies, or industries that
otherwise most affect the financing
companies.
C-24
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not Invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; and (ii) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(ii) is non-fundamental). The
policies in (i) and (ii) above are
permitted only if either (a) the sum
of the initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission). The Portfolio's
policy to not purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return is a
non-fundamental policy.
C-25
METLIFE STOCK INDEX
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio will not order.
lend portfolio securities in excess
of 20% of total assets.
C-26
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 10% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")) except
25% of total assets may be invested
in securities issued, assumed, or
guaranteed by foreign governments or
their political subdivisions or
instrumentalities; assumed or
guaranteed by domestic issuers; or
issued, assumed, or guaranteed by
foreign issuers with a class of
securities listed on NYSE.
C-27
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy); and
(iii) sell covered call options on
and purchase put and call options
contracts on futures contracts (on
recognized futures exchanges) of the
type and for the same reasons the
Portfolio is permitted to enter
futures contracts (other than the
requirement that the Portfolio be
permitted to enter into futures
contracts, this policy in (iii) is
non-fundamental). The policies in
(i) and (iii) above are permitted
only if either (a) the sum of the
initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission (the "CFTC")). The
policies in (ii) above are permitted
so long as the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-28
MORGAN STANLEY EAFE INDEX
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
C-29
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
C-30
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy); and
(iii) sell covered call options on
and purchase put and call options
contracts on futures contracts (on
recognized futures exchanges) of the
type and for the same reasons the
Portfolio is permitted to enter
futures contracts (other than the
requirement that the Portfolio be
permitted to enter into futures
contracts, this policy in (iii) is
non-fundamental). The policies in
(i) and (iii) above are permitted
only if either (a) the sum of the
initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission (the "CFTC")). The
policies in (ii) above are permitted
so long as the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-31
NEUBERGER BERMAN MID CAP VALUE
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
C-32
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 10% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")).
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts. sell commodities or commodity
The Portfolio's policy to not contracts, except that, consistent
purchase and sell futures contracts with its investment policies, the
(on recognized futures exchanges) on Portfolio may purchase and sell
equity securities or stock indices as financial futures contracts and
a hedge or to enhance return is a options and may enter into swap
non-fundamental policy. agreements, foreign exchange
contracts and other financial
transactions not requiring the
delivery of physical commodities.
C-33
OPPENHEIMER GLOBAL EQUITY
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not borrow money to The Portfolio may not borrow money,
purchase securities or purchase except to the extent permitted by
securities on margin. The Portfolio applicable law, regulation or order.
may not (i) borrow money in excess of
33% of total assets for extraordinary
or emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time),
provided that if these obligations
with reverse repurchase agreements do
not exceed 5% of total assets, no
additional securities will be
purchased for the Portfolio; or
(ii) borrow in the form of short-term
credits necessary to clear Portfolio
transactions or enter into reverse
repurchase agreements with banks,
together with amounts borrowed for
extraordinary or emergency purposes,
more than 1/3 of the amount by which
total assets exceed total liabilities
(excluding the liabilities
represented by such obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
C-34
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income. The Portfolio may not commit
more than 5% of the Portfolio's
assets to transactions in options,
futures or other "derivative"
instruments that are intended for any
purpose other than to protect against
changes in market values of
investments the Portfolio owns or
intends to acquire, to facilitate the
sale or disposition of investments
for the Portfolio, or to adjust the
effective duration or maturity of
fixed income instruments owned by the
Portfolio.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
C-35
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
C-36
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-37
RUSSELL 2000 INDEX AND METLIFE MID CAP STOCK INDEX
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
options positions previously entered
into.
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
C-38
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 10% of total assets in foreign
securities (including investments
through European Depositary Receipts
("EDRs") and International Depositary
Receipts ("IDRs"), but excluding
investments through American
Depositary Receipts ("ADRs")) except
that 25% of total assets may be
invested in securities issued,
assumed, or guaranteed by foreign
governments or their political
subdivisions or instrumentalities;
assumed or guaranteed by domestic
issuers; or issued, assumed, or
guaranteed by foreign issuers with a
class of securities listed on NYSE.
C-39
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy); and
(iii) sell covered call options on
and purchase put and call options
contracts on futures contracts (on
recognized futures exchanges) of the
type and for the same reasons the
Portfolio is permitted to enter
futures contracts (other than the
requirement that the Portfolio be
permitted to enter into futures
contracts, this policy in (iii) is
non-fundamental). The policies in
(i) and (iii) above are permitted
only if either (a) the sum of the
initial margin for futures and
options sold on futures, plus
premiums paid for unexpired options
on futures, does not exceed 5% of
total assets or (b) the aggregate
notional value of positions in
futures and options on futures does
not exceed the liquidation value of
the Portfolio's assets (excluding "in
the money" and "bona fide hedging" as
defined by the Commodity Futures
Trading Commission (the "CFTC")). The
policies in (ii) above are permitted
so long as the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-40
T. ROWE PRICE LARGE CAP GROWTH
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income.
C-41
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 30% (excluding reserves) of
total assets in foreign securities
(including investments through
European Depositary Receipts ("EDRs")
and International Depositary Receipts
("IDRs"), but excluding investments
through American Depositary Receipts
("ADRs").
C-42
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-43
T. ROWE PRICE SMALL CAP GROWTH
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
BORROWING: BORROWING:
The Portfolio may not (a) borrow The Portfolio may not borrow money,
money to purchase securities or except to the extent permitted by
purchase securities on margin; applicable law, regulation or order.
(b) borrow money more than 5% of
total assets for extraordinary or
emergency purposes (e.g., to honor
redemption requests which might
otherwise require the sale of
securities at an inopportune time);
or (c) borrow in the form of
short-term credits necessary to clear
Portfolio transactions or to enter
into reverse repurchase agreements
with banks, together with amounts
borrowed for extraordinary or
emergency purposes, more than 1/3 of
the amount by which total assets
exceed total liabilities (excluding
the liabilities represented by such
obligations).
UNDERWRITING: UNDERWRITING:
The Portfolio may not engage in the The Portfolio may not underwrite
underwriting of securities of other securities issued by other persons
issuers except to the extent that in except to the extent that, in
selling portfolio securities it may connection with the disposition of
be deemed to be a "statutory" its portfolio investments, it may be
underwriter for purposes of the deemed to be an underwriter under
Securities Act of 1933. certain federal securities laws.
ISSUANCE OF SENIOR SECURITIES: ISSUANCE OF SENIOR SECURITIES:
The Portfolio may not issue senior The Portfolio may not issue any
securities. senior securities except to the
extent permitted by applicable law,
regulation or order (for purposes of
this restriction, collateral
arrangements with respect to any type
of swap, option, forward contract or
futures contract and collateral
arrangements with respect to initial
and variation margin are not deemed
to involve the issuance of a senior
security).
OPTIONS: OPTIONS:
The Portfolio may not sell call Eliminate.
options which are not covered
options. The Portfolio may not sell
put options other than to close out
option positions previously entered
into; provided that the Portfolio may
(i) sell covered put options on
securities and stock indices to earn
additional income, as a hedge against
or to minimize anticipated loss in
value; and (ii) sell covered put
options on currencies as a hedge
against anticipated declines in
currency exchange rates in which
securities are held or to be
purchased or to earn additional
income.
C-44
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
LOANS: LOANS:
The Portfolio may not make loans but The Portfolio may not make loans,
this shall not prohibit a Portfolio except by purchasing debt obligations
from entering into repurchase in which the Portfolio may invest
agreements or purchasing bonds, consistent with its investment
notes, debentures or other policies, by entering into repurchase
obligations of a character agreements, by lending its portfolio
customarily purchased by securities, or as otherwise permitted
institutional or individual by applicable law, regulation or
investors. The Portfolio may not lend order.
portfolio securities in excess of
33-1/3% of total assets.
REAL ESTATE: REAL ESTATE:
The Portfolio may not invest more The Portfolio may not purchase or
than 10% of total assets (including sell real estate, except that,
REITs) in real estate interests, consistent with its investment
including real estate mortgage loans, policies, the Portfolio may purchase
provided that the limit shall not securities of issuers which deal in
restrict investments in real estate, securities which are
exchange-traded real estate secured by interests in real estate,
investment trusts and shares of other and securities which represent
real estate companies. interests in real estate, and it may
acquire and dispose of real estate or
interests in real estate acquired
through the exercise of its rights as
a holder of debt obligations secured
by real estate or interests therein.
INDUSTRY CONCENTRATION: INDUSTRY CONCENTRATION:
The Portfolio may not invest more The Portfolio may not purchase
than 25% of total assets in securities (other than (i) securities
securities issued by companies issued or guaranteed by the U.S.
primarily engaged in any one government, its agencies or
industry; provided that: instrumentalities and (ii) securities
(a) utilities will be considered of a registered investment company,
separate industries according to type and (iii) in the case of BlackRock
of service; (b) oil and oil related Money Market, bank instruments issued
companies will be considered separate by domestic banks and U.S. branches
industries according to type (e.g., of foreign banks) if, as a result of
domestic crude oil and gas producers, such purchase, more than 25% of the
domestic integrated oil companies, total assets of the Portfolio (as of
international oil companies, and oil the time of investment) would be
service companies will each be deemed invested in any one industry, except
a separate industry); and to the extent permitted by applicable
(c) savings, loan associations, and law, regulation or order.
finance companies will be considered
separate industries. For these
purposes, money market instruments
issued by a foreign branch of a
domestic bank will not be deemed to
be an investment in a domestic bank.
The Fund will disclose when more than
25% of these above-mentioned
Portfolios' total assets are invested
in four oil related industries.
FOREIGN SECURITIES: FOREIGN SECURITIES:
The Portfolio may not invest more Eliminate.
than 20% (excluding reserves) of
total assets in foreign securities
(including investments through
European Depositary Receipts ("EDRs")
and International Depositary Receipts
("IDRs"), but excluding investments
through American Depositary Receipts
("ADRs")).
C-45
CURRENT RESTRICTIONS PROPOSED RESTRICTIONS
- ------------------------------------- -------------------------------------
COMMODITIES: COMMODITIES:
The Portfolio may not invest in The Portfolio may not purchase or
commodities or commodity contracts; sell commodities or commodity
provided that the Portfolio may contracts, except that, consistent
(i) as a non-fundamental investment with its investment policies, the
policy, purchase and sell futures Portfolio may purchase and sell
contracts (on recognized futures financial futures contracts and
exchanges) on debt securities and options and may enter into swap
indices of debt securities as a hedge agreements, foreign exchange
against or to minimize adverse contracts and other financial
principal fluctuations resulting from transactions not requiring the
anticipated interest rate changes or delivery of physical commodities.
to adjust exposure to the bond
market; (ii) purchase and sell
futures contracts (on recognized
futures exchanges) on equity
securities or stock indices as a
hedge or to enhance return (the
recognized exchange requirement is a
non-fundamental policy);
(iii) purchase and sell currency
futures contracts (on recognized
futures exchanges) as a hedge or to
adjust exposure to the currency
market (the recognized exchange
requirement and limitation as to
purpose are non-fundamental
policies); (iv) sell covered call
options on and purchase put and call
options contracts on futures
contracts (on recognized futures
exchanges) of the type and for the
same reasons the Portfolio is
permitted to enter futures contracts
(other than the requirement that the
Portfolio be permitted to enter into
futures contracts, this policy in
(iv) is non-fundamental); and
(v) sell covered put options on
futures contracts (on recognized
futures exchanges) of the type and
for the same reasons the Portfolio is
permitted to enter into futures
contracts. The policies in (i) and
(iv) above are permitted only if
either (a) the sum of the initial
margin for futures and options sold
on futures, plus premiums paid for
unexpired options on futures, does
not exceed 5% of total assets or
(b) the aggregate notional value of
positions in futures and options on
futures does not exceed the
liquidation value of the Portfolio's
assets (excluding "in the money" and
"bona fide hedging" as defined by the
Commodity Futures Trading Commission
(the "CFTC")). The policies in (ii),
(iii) and (v) above are permitted so
long as the sum of the initial margin
for futures and options sold on
futures, plus premiums paid for
unexpired options on futures does not
exceed 5% of total assets (excluding
"in the money" and "bona fide
hedging" as defined by the CFTC).
C-46
APPENDIX D
OUTSTANDING SHARES
NAME OF FUND CLASS A CLASS B CLASS E
- ------------------------------------------- ------- ------- -------
BlackRock Aggressive Growth................
BlackRock Bond Income......................
BlackRock Diversified......................
BlackRock Investment Trust.................
BlackRock Large Cap Value..................
BlackRock Legacy Large Cap Growth..........
BlackRock Money Market.....................
BlackRock Strategic Value..................
Capital Guardian U.S. Equity...............
Davis Venture Value........................
FI International Stock.....................
FI Mid Cap Opportunities...................
FI Value Leaders...........................
Franklin Templeton Small Cap Growth........
Harris Oakmark Focuses Value...............
Harris Oakmark Large Cap Value.............
Jennison Growth............................
Lehman Brothers Aggregate Bond Index.......
Loomis Sayles Small Cap....................
MetLife Aggressive Allocation..............
MetLife Conservative Allocation............
MetLife Conservative to Moderate Allocation
MetLife Mid Cap Stock Index................
MetLife Moderate Allocation................
MetLife Moderate to Aggressive Allocation..
MetLife Stock Index........................
MFS Investors Trust........................
Morgan Stanley EAFE Index..................
MSF Total Return...........................
Neuberger Berman Mid Cap Value.............
Oppenheimer Global Equity..................
Russell 2000 Index.........................
Salomon Brothers Strategic Bond
Opportunities............................
Salomon Brothers U.S. Government...........
T. Rowe Price Large Cap Growth.............
T. Rowe Price Small Cap Growth.............
Zenith Equity..............................
D-1
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
NEW ENGLAND LIFE INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date A
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
METROPOLITAN LIFE INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date B
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
METLIFE INVESTORS USA INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date C
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
METLIFE INVESTORS INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date D
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
METLIFE INVESTORS INSURANCE COMPANY OF CALIFORNIA
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date E
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
FIRST METLIFE INVESTORS INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date F
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
GENERAL AMERICAN LIFE INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date G
VOTING INSTRUCTION CARD METROPOLITAN SERIES FUND, INC. VOTING INSTRUCTION CARD
VOTING INSTRUCTION FORM FOR THE
SPECIAL MEETING OF SHAREHOLDERS
APRIL 28, 2006, 2:00 p.m. EASTERN TIME
MET TOWER INSURANCE COMPANY
The undersigned hereby instructs the above Insurance Company (the "Insurance
Company") to vote the shares of the Portfolios of Metropolitan Series Fund,
Inc. (the "Fund") as to which the undersigned is entitled to give instructions
at the Special Meeting of Shareholders of the Portfolios to be held at the
offices of MetLife Advisers, LLC (the "Manager"), 501 Boylston Street, Boston,
Massachusetts 02116, at 2:00 p.m. Eastern Time on April 28, 2006 and at any
adjournments thereof.
THE INSURANCE COMPANY AND THE BOARD OF DIRECTORS OF THE FUND SOLICIT YOUR
VOTING INSTRUCTIONS AND RECOMMEND THAT YOU INSTRUCT THE INSURANCE COMPANY TO
VOTE "FOR" THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS. THE
INSURANCE COMPANY WILL VOTE THE APPROPRIATE NUMBER OF PORTFOLIO SHARES PURSUANT
TO THE INSTRUCTIONS GIVEN. IF NO INSTRUCTION IS SET FORTH ON A RETURNED FORM AS
TO THE PROPOSALS FOR WHICH YOU ARE ENTITLED TO GIVE INSTRUCTIONS, THE INSURANCE
COMPANY WILL VOTE FOR SUCH PROPOSALS. THE INSURANCE COMPANY IS AUTHORIZED TO
VOTE IN ITS DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENT THEREOF.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-235-4258
VOTE VIA FACSIMILE: 1-888-796-9932
999 9999 9999 999
NOTE: Please sign exactly as your name appears at
left. Joint owners each should sign. When signing
as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------------
Signature
----------------------------------------------------
Signature of joint owner, if any
----------------------------------------------------
Date H
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK. EXAMPLE:
- --------------------------------------------------------------------------------
[ ] To vote FOR ALL Proposals for ALL Portfolios, mark this box. (No other vote
is necessary.)
- --------------------------------------------------------------------------------
PLEASE NOTE: Marking AGAINST or ABSTAIN above will count as a WITHHOLD for
proposal "I." If a ballot is marked both above this note and below it, the mark
above with override any marks made below. For questions on using this ballot,
please call the number on the reverse side.
I. To elect members of the Board of Directors of the Fund.
[ ] to vote FOR all Nominees; [ ] to vote AGAINST all Nominees;
[ ] to ABSTAIN votes for all Nominees; or vote separately by Nominee below.
Director FOR WITHHOLD
--------------------------------------- --- --------
Hugh C. McHaffie........................ [ ] [ ]
Arthur G. Typermass..................... [ ] [ ]
Steve A. Garban......................... [ ] [ ]
Linda B. Strumpf........................ [ ] [ ]
Michael S. Scott Morton................. [ ] [ ]
H. Jesse Arnelle........................ [ ] [ ]
Nancy Hawthorne......................... [ ] [ ]
John T. Ludes........................... [ ] [ ]
Frances M. Hawk......................... [ ] [ ]
II. TO APPROVE, WITH RESPECT TO THE MFS TOTAL RETURN PORTFOLIO, AN AMENDMENT TO
THE ADVISORY AGREEMENT BETWEEN THE FUND, ON BEHALF OF THE MFS TOTAL RETURN
PORTFOLIO, AND THE MANAGER.
FOR AGAINST ABSTAIN
--- ------- -------
MFS Total Return [ ] [ ] [ ]
III. TO APPROVE, FOR CERTAIN PORTFOLIOS, THE ELIMINATION OF OR CHANGES TO
CERTAIN FUNDAMENTAL INVESTMENT RESTRICTIONS.
[ ] to vote all Portfolios FOR; [ ] to vote all Portfolios AGAINST;
[ ] to ABSTAIN votes for all Portfolios; or vote separately by Portfolio below.
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
BlackRock Aggressive Growth Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
BlackRock Diversified Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
BlackRock Investment Trust Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
BlackRock Large Cap Value Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
BlackRock Strategic Value Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
FI International Stock Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
FI Mid Cap Opportunities Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Franklin Templeton Small Borrowing....................... [ ] [ ] [ ]
Cap Growth Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
Harris Oakmark Large Cap Borrowing....................... [ ] [ ] [ ]
Value Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Lehman Brothers Aggregate Borrowing....................... [ ] [ ] [ ]
Bond Index Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
MetLife Mid Cap Stock Index Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
MetLife Stock Index Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Morgan Stanley EAFE Index Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Neuberger Berman Mid Cap Borrowing....................... [ ] [ ] [ ]
Value Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Portfolio Proposal relating to FOR AGAINST ABSTAIN
- --------------------------- ------------------------------- --- ------- -------
Oppenheimer Global Equity Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
Russell 2000 Index Borrowing....................... [ ] [ ] [ ]
Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
T. Rowe Price Large Cap Borrowing....................... [ ] [ ] [ ]
Growth Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
T. Rowe Price Small Cap Borrowing....................... [ ] [ ] [ ]
Growth Underwriting Securities......... [ ] [ ] [ ]
Issuance of Senior Securities... [ ] [ ] [ ]
Options......................... [ ] [ ] [ ]
Making Loans.................... [ ] [ ] [ ]
Real Estate..................... [ ] [ ] [ ]
Industry Concentration.......... [ ] [ ] [ ]
Foreign Securities.............. [ ] [ ] [ ]
Commodities..................... [ ] [ ] [ ]
PLEASE MARK, SIGN, DATE AND RETURN THIS VOTING INSTRUCTION CARD USING THE
ENCLOSED ENVELOPE.