[Liberty Logo] 600 Atlantic Avenue
LIBERTY Federal Reserve Plaza
ALL-STAR Boston, MA 02210-2214
- -------------------- 617-722-6036
GROWTH & INCOME FUND
December 13, 1999
Dear Shareholder:
I am writing to notify you of a change to one of the five portfolio managers for
the Liberty All-Star Growth & Income Fund from Wilke/Thompson Capital
Management, Inc. to the TCW Funds Management, Inc. (TCW). The change was
effective November 1, 1999.
Glen E. Bickerstaff, Managing Director U.S. Equities at TCW, will serve as
portfolio manager to the Fund. Prior to joining TCW in 1998, Mr. Bickerstaff
was a portfolio manager at Transamerica Investment Services. He has 19 years of
investment experience. Mr. Bickerstaff and his investment team practice a
concentrated growth-equity investment style.
Liberty All-Star Growth & Income Fund's other four portfolio managers are Boston
Partners Asset Management, L.P., J.P. Morgan Investment Management Inc.,
Oppenheimer Capital and Westwood Management Corporation. Each portfolio manager
manages an equal portion of the Fund's assets.
Please refer to the enclosed information for additional details. If you have
questions, please contact your Investment Professional or Liberty Fund Services,
Inc. at 1-800-345-6611. Thank you for selecting Liberty All-Star Growth & Income
Fund and for giving us the opportunity to serve your investment needs.
Sincerely,
William R. Parmentier, Jr.
President
AL-088I-1099 99/1429
<PAGE>
LIBERTY ALL-STAR GROWTH AND INCOME FUND
ONE FINANCIAL CENTER
BOSTON, MASSACHUSETTS 02111
INFORMATION STATEMENT REGARDING
CHANGE OF PORTFOLIO MANAGER
BACKGROUND
Liberty All-Star Growth and Income Fund (the "Fund") is a series of
Liberty Funds Trust IX (the "Trust"), a Massachusetts business trust organized
in 1998. The principal underwriter of the Fund is Liberty Funds Distributor,
Inc. ("LFD") and the administrator of the Fund is Colonial Management
Associates, Inc. ("CMA"). Both LFD and CMA are affiliates of Liberty Asset
Management Company ("LAMCO"), the Fund's advisor.
The Fund is a "multi-managed" fund that allocates its portfolio assets
among a number of independent investment management organizations ("Portfolio
Managers") -- currently five in number -- recommended by the Fund's advisor,
LAMCO, 600 Atlantic Avenue, Boston, Massachusetts 02210. Each Portfolio Manager
employs a different investment style. From time to time LAMCO rebalances the
Fund's portfolio assets among the Portfolio Managers in order to maintain an
approximately equal allocation of portfolio assets among them throughout all
market cycles.
LAMCO continuously monitors the performance and the investment styles
of the Fund's Portfolio Managers and from time to time may recommend changes in
the Portfolio Managers based on factors such as changes in a Portfolio Manager's
investment style or a departure by a Portfolio Manager from the investment style
for which it had been selected, a deterioration in a Portfolio Manager's
performance relative to that of other investment management firms practicing a
similar style, or adverse changes in its ownership or personnel.
Under an exemptive order issued by the Securities and Exchange
Commission on September 28, 1999, the Fund may enter into a portfolio management
agreement with a new Portfolio Manager without a vote of shareholders of the
Fund, provided that the shareholders of the Fund are furnished information about
the new Portfolio Manager and its portfolio management agreement within 90 days
of the effective date of the Portfolio Manager change. This Information
Statement is being furnished in connection with the replacement effective
November 1, 1999 of Wilke/Thompson Capital Management, Inc. by TCW Funds
Management, Inc. as a Portfolio Manager of the Fund, as recommended by LAMCO and
approved by the Board of Trustees of the Trust on October 27, 1999.
INFORMATION ABOUT TCW FUNDS MANAGEMENT, INC.
TCW Funds Management, Inc. ("TCW"), located at 865 South Figueroa
Street, Los Angeles, California 90017, is a wholly-owned subsidiary of The TCW
Group, Inc. ("TCW Group"). Established in 1971, TCW Group's direct and indirect
subsidiaries, including TCW, provide a variety of trust, investment management
and investment advisory services. Ownership of the TCW Group lies approximately
95% with its employees and 5% with its directors. Robert A. Day, who is Chairman
of the Board of Directors of TCW Group, may be deemed to be a control person of
TCW by virtue of the aggregate ownership by Mr. Day and his family of more than
25% of the outstanding voting stock of the TCW Group. As of September 30, 1999,
TCW had over $55 billion in assets under management.
<PAGE>
The following are the directors and principal executive officer of TCW:
<TABLE>
<CAPTION>
Name and Address Position with TCW Principal Occupation
<S> <C> <C>
Alvin Robert Albe, Jr. Director, President Director, President and CEO of TCW and TCW
865 South Figueroa St. and Chief Executive Investment Management Company ("TIMCO"); Director of
Los Angeles, CA 90017 Officer TCW Asia Limited; Director and Executive Vice
President - Finance & Administration of TCW
Advisors, Inc. ("TCWA"), TCW London International,
Limited, TCW Asset Management Company ("TAMCO") and
Trust Company of the West ("TCofW"); Executive Vice
President - Finance & Administration of The TCW
Group, Inc. ("TCW Group")
Thomas Ernest Larkin, Jr. Director and Chairman Director and Chairman of the Board of TCW; Director
865 South Figueroa St. of the Board and Vice Chairman of TCWA, TAMCO and TIMCO; Director
Los Angeles, CA 90017 of TCW Americas Development, Inc.; Director and
President of TCofW; Director, Executive Vice
President and Group Managing Director of TCW Group
Marc Irwin Stern Director and Chairman Chairman of the Board of TCW, London and Americas,
865 South Figueroa St. of the Board Inc.; Managing Director of TCW/Latin America
Los Angeles, CA 90017 Partners, LLC; Director of TCW/Crescent Mezzanine,
LLC; Director and Vice Chairman of TCWA and
TIMCO; Investment Committee Member of Special
Credits; Chairman of the Board and Investment
Committee Member of Asia; Director, Vice Chairman
and President of TAMCO; Director, Executive Vice
President and Group Managing Director of TCW
Group
</TABLE>
Mr. Glen E. Bickerstaff, Managing Director, U.S. Equities, manages that
portion of the Fund's portfolio assigned to TCW. Prior to joining TCW in 1998,
Mr. Bickerstaff was a portfolio manager at Transamerica Investment Services.
TCW uses a "bottom-up" approach by investing in primarily large-cap
companies that have distinct business model advantages and incorporates secular
growth trends.
On November 1, 1999, the Trustees and Officers of the Trust owned less
than 1% of the outstanding shares of TCW, its parent or any subsidiaries.
The portfolio management agreement dated November 1, 1999 among the
Fund, LAMCO and TCW is substantially identical to the Fund's agreements with its
other Portfolio Managers. Under the portfolio management agreements, including
TCW's, each Portfolio Manager has discretionary investment authority with
respect to the portion of the Fund's portfolio assets allocated to it by LAMCO,
subject to the Fund's investment objective and policies, to the supervision and
control of the Trustees of the Trust, and to any instructions from LAMCO. The
Portfolio Managers are required to use their best professional judgment in
making timely investment decisions for the Fund. The Portfolio Managers,
however, will not be liable for actions taken or omitted in good faith and
believed to be within the authority conferred by their portfolio management
agreements and without willful misfeasance, bad faith or gross negligence.
The Fund pays LAMCO an advisory fee of 0.60% per annum of the average
daily net assets of the Fund. LAMCO in turn pays each Portfolio Manager of the
Fund, including TCW and excluding OpCap Advisors, a fee, accrued daily and paid
monthly, at the annual rate of 0.30% of the average daily net assets of that
portion of the Fund's portfolio assets assigned to that Portfolio Manager. The
agreement with OpCap Advisors provides for a fee of 0.40% per year of the
average daily net asset value of the portion of the Fund's portfolio assigned to
it up to $100 million and 0.30% of such average daily net asset value in excess
of $100 million. OpCap Advisors has voluntarily agreed, however, to waive any
fee in excess of 0.30% until the earlier of March 1, 2002 or the date the total
of the Fund's net assets reaches $100 million. Any increase in the fee payable
to OpCap Advisors following the expiration of its fee waiver agreement will be
borne by LAMCO. No fees or payments have been made by the Fund to TCW or an
affiliate of TCW during the Fund's fiscal year ended December 31, 1998.
OTHER FUNDS MANAGED BY TCW
In addition to the management services provided by TCW to the Fund, TCW
also provides management services to other investment companies. Information
with respect to the assets of and management fees payable to TCW by those funds
having investment objectives similar to those of the Fund is set forth below:
<TABLE>
<CAPTION>
Fund Total Net Assets at Annual Management Fee
November 15, 1999 as a % of
(in millions) Average Daily Net Assets
<S> <C> <C>
Enterprise Group of Funds, Inc. Equity Fund $18.9 0.40%(1)
Enterprise Accumulation Trust Equity Portfolio $545 0.40%(2)
SEI Institutional Investments Trust: Large Cap Fund $2,648 0.20%
SEI Institutional Managed Trust: Large Cap $3,123 0.20%
Growth Fund
TCW Galileo Select Equities Fund $328.9 0.75%
The Vantagepoint Funds Growth Fund $2,666 0.70%(3)
</TABLE>
(1) Under the fund's management agreement, the fund pays TCW a fee at the
annual rate of 0.40% of the first $100 million of the average daily
net assets of the fund and 0.30% in excess of $100 million.
(2) Under the fund's management agreement, the fund pays TCW a fee at the
annual rate of 0.40% of the first $1 billion of the average daily net
assets of the fund and 0.30% in excess of $1 billion.
(3) Under the fund's management agreement, the fund pays TCW a fee at the
annual rate of 0.70% of the first $25 million of the average daily net
assets of the fund, 0.50% of the next $25 million of the average daily
net assets of the fund, 0.45% of the next $50 million of the average
daily net assets of the fund, 0.40% of the next $400 million of the
average daily net assets of the fund and 0.35% in excess of $400
million.
<PAGE>
PORTFOLIO TRANSACTIONS AND BROKERAGE
Each of the Fund's Portfolio Managers, including TCW, has discretion to
select brokers and dealers to execute portfolio transactions initiated by the
Portfolio Manager for the portion of the Fund's portfolio assets allocated to
it, and to select the markets in which such transactions are to be executed. The
portfolio management agreements with the Fund provide, in substance, that in
executing portfolio transactions and selecting brokers or dealers, the primary
responsibility of the Portfolio Manager is to seek to obtain best net price and
execution for the Fund.
The Portfolio Managers are authorized to cause the Fund to pay a
commission to a broker or dealer who provides research products and services to
the Portfolio Manager for executing a portfolio transaction which is in excess
of the amount of commission another broker or dealer would have charged for
effecting that transaction. The Portfolio Managers must determine in good faith,
however, that such commission was reasonable in relation to the value of the
research products and services provided them, viewed in terms of that particular
transaction or in terms of all the client accounts (including the Fund) over
which the Portfolio Manager exercises investment discretion. It is possible that
certain of the services received by a Portfolio Manager attributable to a
particular transaction will primarily benefit one or more other accounts for
which investment discretion is exercised by the Portfolio Manager.
The portfolio management agreements with the Fund's Portfolio Managers,
including TCW, provide that LAMCO has the right to request that transactions
giving rise to brokerage commissions, in amounts to be agreed upon from time to
time between LAMCO and the Portfolio Manager, be executed by brokers and dealers
(to be agreed upon from time to time between LAMCO and the Portfolio Manager)
which provide research products and services to LAMCO or to the Fund or other
accounts managed by LAMCO (collectively with the Fund, "LAMCO Clients"). The
commissions paid on such transactions may exceed the amount of commissions
another broker would have charged for effecting those transactions. Research
products and services made available to LAMCO through brokers and dealers
executing transactions for LAMCO Clients involving brokerage commissions include
performance and other qualitative and quantitative data relating to investment
managers in general and the Portfolio Managers in particular; data relating to
the historic performance of categories of securities associated with particular
investment styles; mutual fund portfolio and performance data; data relating to
portfolio manager changes by pension plan fiduciaries; quotation equipment; and
related computer hardware and software. All of these research products and
services are used by LAMCO in connection with its selection and monitoring of
portfolio managers (including the Portfolio Managers) for LAMCO Clients, the
assembly of a mix of investment styles appropriate to LAMCO's Clients'
investment objectives, and the determination of overall portfolio strategies.
LAMCO from time to time reaches understandings with each of the
Portfolio Managers as to the amount of the Fund's portfolio transactions
initiated by such Portfolio Manager that are to be directed to brokers and
dealers which provide research products and services to LAMCO. These amounts may
differ among the Portfolio Managers based on the nature of the markets for the
types of the securities managed by them and other factors.
These research products and services are used by LAMCO in connection
with its management of LAMCO Clients' portfolios, regardless of the source of
the brokerage commissions. In instances where LAMCO receives from broker-dealers
products or services which are used both for research purposes and for
administrative or other non-research purposes, LAMCO makes a good faith effort
to determine the relative proportions of such products or services which may be
considered as investment research, based primarily on anticipated usage, and
pays for the costs attributable to the non-research usage in cash.
Further information concerning the Fund is contained in its semi-annual
report to shareholders, which is obtainable free of charge by writing Liberty
Funds Distributor, Inc., the Fund's distributor, at One Financial Center,
Boston, Massachusetts 02111 or by calling 1-800-426-3750.
AL-087I-1099 Dated: December 10, 1999
