DARSIE & ELSTE
ATTORNEYS AT LAW
P.O. Box 22219
LEXINGTON, KENTUCKY 40522
GAY M. ELSTE JOHN C. DARSIE, JR.
(1936-1994)
September 17, 1999
Securities and Exchange Commission
450 5th Street
Judiciary Plaza
Washington DC 20549
Attention: Proxy Filing Desk
Please find attached the 1999 Proxy for Dupree Mutual Funds.
Please feel free to contact me at (606) 323 1161 for any further information
which may be provided or undertaken.
Sincerely,
Gay M. Elste
DUPREE MUTUAL FUNDS
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
October 26, 1999
The Annual Meeting of Shareholders of Dupree Mutual Funds, a Kentucky business
trust, (the "Trust"), will be held at the Radisson Plaza Hotel, 369 West Vine
Street, Lexington, Kentucky 40507-1636, on Tuesday, October 26, 1999 at 10:00
A. M., Lexington time, for the following purposes:
1. Election of Trustees
2. Ratification or rejection of independent certified public accountants
3. Each of the six single state municipal bond series will be asked to
separately vote to amend the fundamental investment restrictions for the
series to allow additional nationally recognized statistical rating
organizations' ratings of municipal securities be utilized in the
determination of investment grade securities eligible for purchase by the
series.
4. Other business
Shareholders are cordially invited to meet with the officers and Trustees
of the Trust prior to the meeting, beginning at 9:30 A.M. at the Radisson
Plaza Hotel. This notice of annual meeting, proxy statement and proxy are
first being delivered or mailed to shareholders on September 27, 1999.
FRED L. DUPREE, JR.
Secretary
September 17, 1999
125 South Mill Street
Lexington, Kentucky 40507
YOUR VOTE IS IMPORTANT!
Shareholders are urged to read carefully and follow the instructions on the
enclosed proxy card, indicate their choices as to each of the matters to be
acted upon, and to date, sign, and return the completed and signed proxy in
the accompanying envelope, which requires no postage if mailed in the United
States. Your prompt return of the proxy will help the Trust avoid the
additional expense of further solicitation to assure a quorum at the meeting.
DUPREE MUTUAL FUNDS
Annual Meeting of Shareholders
October 26, 1999
PROXY STATEMENT
This statement is furnished in connection with the solicitation of proxies
by the Board of Trustees of Dupree Mutual Funds, a Kentucky business trust,
(the "Trust"), for use at the Annual Meeting of Shareholders of the Trust to
be held on October 26, 1999, and at any and all adjournments thereof.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the meeting, the shares covered thereby will be voted in
accordance with the instructions marked thereon by the shareholders.
Executed proxies that are unmarked will be voted:
1) for the nominees of the Board of Trustees of the Trust in the election of
Trustees,
2) in favor of the ratification of the selection of independent
certified public accountants for the Trust, and
3) in favor of amendment of the series' fundamental investment
restrictions to allow additional nationally, recognized statistical
rating organizations' ratings of municipal securities be utilized
in the determination of investment grade securities eligible for
purchase by the series.
SUMMARY OF PROPOSALS
Election of Ratify or Ratify or
Trustees Reject Reject
Independent Amendment to
Certified Investment
Public Restrictions
Accountant
Kentucky Tax-Free
Income Series Cumulative Vote Vote Separate Series Vote
Kentucky Tax-Free
Short-to-Medium Series Cumulative Vote Vote Separate Series Vote
North Carolina Tax-Free
Income Series Cumulative Vote Vote Separate Series Vote
North Carolina Tax-Free
Short-to-Medium Series Cumulative Vote Vote Separate Series Vote
Tennessee Tax-Free
Income Series Cumulative Vote Vote Separate Series Vote
Tennessee Tax-Free
Short-to-Medium Series Cumulative Vote Vote Separate Series Vote
Intermediate
Government Bond Series Cumulative Vote Vote Not Applicable
Any proxy may be revoked at any time prior to its exercise by a written
notice of revocation addressed to and received by the Secretary of the Trust,
by delivering a duly executed proxy bearing a later date, or by attending the
meeting and voting in person.
As of September 17 , 1999, there were xxxxxxxxx shares of beneficial
interest of the Trust outstanding, being comprised of:
XXXXXXXXXX.XXX shares of Kentucky Tax-Free Income Series
XXXXXXXXXX.XXX shares of Kentucky Tax-Free Short-to-Medium Series
XXXXXXXXXX.XXX shares of North Carolina Tax-Free Income Series
XXXXXXXXXX.XXX shares of North Carolina Tax-Free Short-to-Medium Series,
XXXXXXXXXX.XXX shares of Tennessee Tax-Free Income Series
XXXXXXXXXX.XXX shares of Tennessee Tax-Free Short-to-Medium Series, and
XXXXXXXXXX.XXX shares of Intermediate Government Bond Series
all having no par value. As of that date no person was known to the Trust
to be the beneficial owner of more than five percent of the outstanding
shares of the Kentucky Tax-Free Income Series, North Carolina Tax-Free
Income Series, or the Intermediate Government Bond Series.
As of that date, the following persons were known to the Trust to be
beneficial owners of more than five percent of the outstanding shares of
the following series:
Name(s) of Share Owners Amount of Beneficial Ownership Percent of
Shares Held
KY Tax-Free Short-to-Medium Series
shares %
shares %
NC Tax-Free Short-to-Medium Series
shares %
shares %
shares %
shares %
TN Tax-Free Income Series
shares %
shares %
TN Tax-Free Short-to-Medium Series
shares %
shares %
shares %
shares %
shares %
As of that date, the Trustees and Officers of the Trust, as a group bene-
ficially owned, directly or indirectly xxxxxx shares, representing approx-
imately xxx % of the outstanding shares.
A copy of the annual report of Dupree Mutual Funds for the fiscal year ended
June 30, 1999, including financial statements, has been mailed to share-
holders of record at the close of business on that date, and to persons who
became shareholders of record between that time and the close of business on
September 17, 1999, the record date for the determination of the shareholders
who are entitled to be notified of and to vote at the meeting. Copies of the
annual report may be obtained by shareholders free of charge by contacting
the Trust at P.O. Box 1149, Lexington, KY 40588-1149 or calling 800 866 0614.
Shareholders are entitled to one vote for each full share, and a proportionate
vote for each fractional share, of the Trust held as of the record date except
with respect to the election of Trustees, as to which cumulative voting shall
apply. In accordance with Kentucky law, shares owed by three or more persons
as co-fiduciaries will be voted in accordance with the will of the majority
of such fiduciaries, unless a written instrument or court order providing to
the contrary has been filed with the Secretary of the Trust.
A majority of the shares of the Trust entitled to vote shall constitute a
quorum for the transaction of business. A majority of the shares voted, at a
meeting where a quorum is present, shall decide any questions, except where a
different vote is specified by the Investment Company Act of 1940, and a
plurality shall elect a Trustee. If no instruction is given on a proxy, the
proxy will be voted in favor of the nominees as trustees, in favor of
selection of Ernst & Young LLP to serve as independent certified public
accountants and in favor of amending the fundamental investment restrictions
to expand the group of ratings services for municipal securities, whose ratings
may be considered. Abstentions and broker no-votes will not count toward a
quorum though they will be counted with the majority of votes cast on any
item of business if a quorum is present.
The costs of the meeting, including the solicitation of proxies, will be paid
by the Trust. Persons holding shares as nominees will be reimbursed, upon
request, for their reasonable expenses in sending soliciting material to the
principals of the accounts. In addition to the solicitation of proxies by
mail, officers and Trustees of the Trust may solicit proxies in person or by
telephone.
The date of this Proxy Statement is September 17, 1999.
ELECTION OF TRUSTEES
The Trust's Board of Trustees has nominated the seven (7) persons listed
below for election as Trustees for the ensuing year, each to hold office
until the 2000 Annual Meeting of Shareholders and until their successors are
duly elected and qualified. All of the nominees are members of the present
Board of Trustees of the Trust. A shareholder using the enclosed form of
proxy can vote for all or any of the nominees of the Board of Trustees or
can withhold his or her vote from all or any of such nominees. If the proxy
card is properly executed but unmarked it will be voted for all of the
nominees. Each of the nominees has agreed to serve as a Trustee if elected;
however, should any nominee become unable or unwilling to accept nomination
or election, the persons named in the proxy will exercise their voting
power in favor of such other person or persons as the Board of Trustees of
the Trust may recommend. Two of the nominees, Thomas P. Dupree, Sr. and
Fred L. Dupree, Jr. are brothers.
In electing Trustees, shareholders are entitled to exercise cumulative voting
rights. Under cumulative voting, each shareholder has the right to cast, in
person or by proxy, an aggregate amount of votes equal to the number of shares
held by such shareholder, multiplied by the number of Trustees to be elected,
and the shareholder may cast the whole number of votes for one candidate, or
distribute such votes among two or more candidates. The accompanying form
of proxy confers cumulative voting rights on the persons named thereon as
proxies.
Name, Address and
Age of Nominee Principal Occupations(1) Shares Beneficially
Owned Directly or
Indirectly, as of
September 17, 1999
THOMAS P. DUPREE, SR.*
125 South Mill Street
Lexington, KY 40507
Age: 69
Chairman of the Board of Dupree &
Company, Inc. (President until 1996) .%
FRED L. DUPREE, JR.*
125 South Mill Street
Lexington, KY 40507
Age: 72
Vice President, Secretary, Treasurer and
Director of Dupree & Company, Inc. .%
WILLIAM T. GRIGGS II*
125 South Mill Street
Lexington, KY 40507
Age: 48
President, Dupree & Company, Inc.
(Vice President until 1996) .%
LUCY A. BREATHITT
1703 Fairway Drive
Lexington, KY 40502
Age: 62
Alexander Farms, farming; KY Horse Park
Foundation Board; KY Horse Park Museum
Board. .%
WILLIAM A. COMBS, JR.
111 Woodland Avenue, #510
Lexington, KY 40502
Age: 59
Secretary, Treasurer, Director, Dana Motor
Company, Cincinnati, OH; Secretary,
Treasurer, Director, Freedom Dodge,
Lexington, KY; Secretary, Treasurer, Director,
Ellerslie Reality, Inc., Lexington, KY; Partner,
Forkland Development Company, Lexington,
KY; Partner, Lexland, Lexington, KY;
Director, First Security Bank, Lexington, KY .%
ROBERT L. MADDOX
2800 Citizens Plaza
Louisville, KY 40202
Age: 75
Partner (retired 1994) Wyatt, Tarrant &
Combs, Louisville, KY, Attorneys; Director,
Nugent Sand Company, Louisville, KY;
Director, Orr Safety Corp., Louisville, KY;
Director, Whip-Mix Corp., Louisville, KY. .%
WILLIAM S. PATTERSON
367 West Short Street
Lexington, KY 40507
Age: 67
President, CEO, Cumberland Surety Co.,
Lexington, KY; President, Patterson & Co.,
Frankfort, KY (real estate development
thoroughbred horse-breeding, farming). .%
* Thomas P. Dupree, Sr., Fred L. Dupree, Jr., and William T. Griggs II are
"interested persons" of the Trust's Investment Adviser and of the Trust
within the meaning of Section 2(a)(19) of the Investment Company Act of 1940
by virtue of their officership, directorship and/or employment with Dupree &
Company, Inc. Dupree & Company, Inc. also serves as the Trust's Transfer
Agent. The other nominees are the non-interested Trustees of the Trust. For
the fiscal year ended June 30, 1999 the Trust paid to Dupree & Company, Inc.
investment advisory fees and transfer agent fees totaling $2,949,116.
(1) Except as otherwise noted, each individual has held the office indicat-
ed, or other offices in the same company, for the last five years.
Pension or
Name of Person, Aggregate Retirement Estimated Annual Total Compensation
Position Compensation BenefitsAccrued Benefits Upon From Trust and
From Trust As Part of Trust Retirement Trust Complex
Expenses Paid to Trustees
Thomas P. Dupree, Sr. -0- None - No Pension None -0-
President, Chairman or Retirement Plan
Trustee
Fred L. Dupree, Jr. -0- None - No Pension None -0-
Vice President, or Retirement Plan
Secretary, Treasurer
Trustee
William T. Griggs II* -0- None - No Pension None -0-
Vice President, Assistant or Retirement Plan
Secretary, Trustee
Lucy A. Breathitt $14,000 None - No Pension None $14,000
Trustee or Retirement Plan
William A. Combs, Jr.$14,000 None - No Pension None $14,000
Trustee or Retirement Plan
Robert L. Maddox $14,000 None - No Pension None $14,000
Trustee or Retirement Plan
William S. Patterson $14,000 None - No Pension None $14,000
Trustee or Retirement Plan
Michelle M. Dragoo -0- None - No Pension None -0-
Vice President or Retirement Plan
since 1997 Assistant
Vice President
1992-1996
Alison L. Arnold -0- None - No Pension None -0-
Assistant Vice or Retirement Plan
President
The Board of Trustees has authorized the payment of a fee of $13,000 to each
of the non-interested Trustees for the fiscal year ending June 30, 2000,
plus a fee of $1,000 to each of the non-interested Trustees for each audit
committee meeting attended. Two audit committee meetings are anticipated to
be held during the fiscal year ending June 30, 2000.
The Board of Trustees has an audit committee comprised of the four non-
interested trustees, but does not have an executive committee or a nominating
committee. The audit committee met once during the fiscal year ended June 30,
1999, with all members in attendance. All nominees attended at least 75% of
the four meetings of the Board of Trustees during the fiscal year ended June
30, 1999.
At the October 27, 1998 Annual Meeting of Shareholders 68,397,592.951 Dupree
Mutual Funds shares were outstanding and entitled to vote. Of the shares
outstanding and entitled to vote 44,977,039.146 shares were present
and voting in person or by proxy, for a percentage of 65.76%.
RATIFICATION OR REJECTION OF SELECTION
OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The selection by the Board of Trustees of the firm of Ernst & Young LLP, cert-
ified public accountants, as the independent certified public accountants for
the fiscal year ending June 30, 2000 will be submitted for ratification or
rejection by the shareholders at the annual meeting. If approved, Ernst &
Young LLP will perform audit, tax preparation and other accounting services
for the Trust for the fiscal year ending June 30, 2000.
The affirmative vote of a majority of the Trust's outstanding voting securities
is required for ratification of the selection of Ernst & Young LLP As defined
in the Investment Company Act of 1940, the phrase "vote of a majority of the
outstanding voting securities" means the vote of the holders of the lesser of
(a) 67% of the shares present in person or represented by proxy and entitled
to vote at the meeting, if the holders of more than 50% of the outstanding
shares are so present or represented, and (b) more than 50% of the out-
standing shares. Representatives of Ernst & Young LLP are expected to be
available at the annual meeting to respond to appropriate questions.
FUNDAMENTAL INVESTMENT RESTRICTIONS/RATING SERVICES
Kentucky Tax-Free Income Series
Kentucky Tax-Free Short-to-Medium Series
North Carolina Tax-Free Income Series
North Carolina Tax-Free Short-to-Medium Series
Tennessee Tax-Free Income Series
Tennessee Tax-Free Short-to-Medium Series
Each of the individual single state municipal bond series of the Trust will be
asked to vote separately to allow for additional nationally recognized statis-
tical rating organizations' ratings of municipal securities to be utilized in
the determination of investment grade securities eligible for purchase by the
series.
Since its inception, each of the single state municipal bond series of the Trust
has followed the fundamental policy of investing at least 80% of the value of
the assets in securities meeting the investment grade quality standards defined
by Moody's Investors Service Inc. (Moody's) or Standard & Poor's Corpration
(S&P). These grades are defined as the four highest grades for bonds and the
three highest grades for notes. In addition, each of the single state
municipal bond series could include within the 80% category those notes or
bonds secured by the full faith and credit of the United States Government.
Over the years, several other nationally recognized statistical rating organiza-
tions have emerged to rate the many municipal securities which are issued in the
states for which the Trust has established series. Municipal issuers select
rating services for a variety of reasons, including convenience, familiarity
with the issuer, price, etc. In order for the Trust to be able to contin-
ually make the most appropriate purchases for each series' portfolio, the
Trust would be well served to allow its Investment Adviser for each series to
consider not only ratings provided by Moody's or Standard & Poor's but also
other recognized national ratings services who may be rating given issues of
municipal securities.
The Trust is not proposing to modify its commitment to the purchase of invest-
ment grade securities for each of the series, but is seeking to expand upon
the available ratings organizations which may be utilized in the
consideration of market ratings for the several municipal securities issues
which may be attractive additions to the portfolios of the single state
series. The affirmative vote of a majority of the trust's outstanding voting
securities is required to amend the fundamental investment restrictions. As
defined in the Investment Company Act of 1940, the phrase "vote of a
majority of the outstanding voting securities" means the vote of the
holders of the lesser of (a) 67% of the shares present in person or
represented by proxy and entitled to vote at the meeting, if the holders of
more than 50% of the outstanding shares are so present or represented,
and (b) more than 50% of the outstanding shares.
INVESTMENT ADVISORY AGREEMENTS - ALL SERIES
Dupree & Company, Inc., 125 South Mill Street, Suite 100, Lexington, KY
40507 is the investment advisor for all series of the trust and was the
original Investment Advisor from 1979-1986 of the original series of the
Trust, the former Kentucky Tax-Free Income Fund, Inc. At the time
that the shareholders of the former Kentucky Tax-Free Income Fund,
Inc. voted to change its form of business to a business trust,
Dupree & Company, Inc. created its subsidiary corporation, Dupree
Investment Advisers, Inc. to become the investment advisor for the several
series of the Trust which were later created. The creation of Dupree
Investment Advisers, Inc. was undertaken at that time by Dupree &
Company, Inc. for business and tax reasons associated with that company.
In 1997 Dupree Investment Advisers, Inc. was absorbed by its parent
company, Dupree & Company, Inc.
Thomas P. Dupree, Sr., who is Chairman of the Board of Dupree & Company, Inc.
and owner of 51% of the stock of Dupree & Company, Inc. (Claire Dupree, Mr.
Dupree's wife is the owner of the remaining 49% of the stock of Dupree &
Company, Inc.) also serves as President and a member of the Trust's Board of
Trustees. William T. Griggs II is President of Dupree & Company, Inc., Mr.
Griggs also serves as a Vice President of the Trust. Fred L. Dupree, Jr. is
Vice President, Secretary, Treasurer and a Director of Dupree & Company,
Inc., Michelle M. Dragoo and Dorine D. Kelly are Vice Presidents of Dupree &
Company, Inc. Alison L. Arnold is Assistant Vice President of Dupree &
Company, Inc.
Each series is currently served by Dupree & Company, Inc., pursuant to
agreements previously approved by shareholders of each series. The
affirmative vote of a majority of the series' outstanding voting securities
is required for ratification of the Investment Advisory Agreement. As
defined in the Investment Company Act of 1940, the phrase "vote a majority
of the outstanding voting securities" means the vote of the holders of the
lesser of (a) 67% of the shares present in person or represented by proxy and
entitled to vote at the meeting, if the holders of more than 50% of the
outstanding shares are so present or represented, and (b) more than 50% of
the outstanding shares. The Investment Advisory Agreement for each series
commenced November 1, 1997 and has been continued in effect until
October 31, 1999, and thereafter from year to year, if such continuation is
specifically approved. At least annually the proposed agreement must be
specifically approved by the Trust's Board of Trustees at a meeting called
for that purpose or by a vote of the holders of a majority of the series'
shares, and in either case, also by a vote of a majority of the Trust's
Trustees who are not "interested persons" of Dupree & Company, Inc. or the
Trust within the meaning of the Investment Company Act of 1940. The proposed
agreement is subject to termination by either party without penalty on 60
days written notice to the other, and it terminates automatically in the
event of assignment.
Pursuant to each agreement, the Investment Adviser provides investment super-
visory services, office space and facilities and corporate administration.
Specifically, the Investment Adviser obtains and evaluates relevant information
regarding the economy, industries, businesses, municipal issuers, securities
markets and securities to formulate a continuing program for the management
of each series' assets in a manner consistent with the series' investment
objectives; and to implement this program by selecting the securities to be
purchased or sold by the series and placing orders for such purchases and
sales. In addition, the Investment Adviser provides for the series' office
needs, maintains each series' books and records, assumes and pays all sales
and promotional expenses incurred in the distribution of each series' shares,
staffs the series with persons competent to perform all of its executive and
administrative functions, supervises and coordinates the activities of the
Trust's institutional and other agents (e.g. custodian, transfer agent,
independent accountants, outside legal counsel), and permits its officers and
employees to serve as Trustees and officers of the Trust, all without
additional cost to the Trust.
Under each agreement, neither the Investment Adviser nor any of its
directors, officers or employees performing executive or administrative
functions for each series will be liable to the Trust for any error of
judgment, mistake of law or other act or omission in connection with a
matter to which the agreement relates, unless such error, mistake, act or
omission involves willful misfeasance, bad faith, gross negligence or
reckless disregard of duty or otherwise constitutes a breach of fiduciary
duty involving personal misconduct.
Each agreement permits the Investment Adviser to voluntarily reimburse any
series. The Trust currently sells to Kentucky, Indiana, Florida, Tennessee,
Texas and North Carolina residents. Kentucky, Florida, Tennessee and North
Carolina do not currently impose a limitation upon investment advisory fees
charged to mutual funds, but both Indiana and Texas do as follows: 1.5% of
the first $30,000,000 in net assets and 1% of any additional net assets for
Indiana; and 2% of the first $10,000,000 of average net assets, 1.5% of the
next $20,000,000 of average net assets and 1% of the remaining average net
assets for Texas.
OTHER BUSINESS
The management of the Trust knows of no other business which may come before the
meeting. However, if any additional matters are properly presented at the
meeting, it is intended that the persons named in the enclosed proxy, or
their substitutes, will vote such proxy in accordance with their judgment on
such matters.
SHAREHOLDERS' PROPOSALS
If a shareholder wishes to present a proposal at the 2000 Annual Meeting of
Shareholders, scheduled for that year, such proposal must be received by the
Secretary of the Trust at the Trust's Lexington office prior to May 20, 2000.
The Trustees and officers of the Trust welcome the opportunity to discuss
proposals or suggestions any shareholder may have.
PROXY
DUPREE MUTUAL FUNDS
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR ANNUAL MEETING TO BE HELD AT
THE RADISSON PLAZA HOTEL, 369 WEST VINE STREET, LEXINGTON, KY 40507-1636
AT 10:00 A.M., LEXINGTON TIME, TUESDAY, OCTOBER 26, 1999
The signed hereby constitutes and appoints THOMAS P. DUPREE, SR. and FRED L.
DUPREE, JR. and each of them, with full power of substitution, to represent
the SIGNED at the Annual Meeting of the Shareholders of DUPREE MUTUAL FUNDS
(the "Trust") to be held at the Radisson Plaza Hotel, 369 West Vine Street,
Lexington, KY 40507-1636 on Tuesday, October 26, 1999 at 10:00 A.M.,
Lexington time, and at any adjournments thereof, and there at to vote all
of the shares of the Trust which the signed would be entitled to vote, with all
powers the signed would possess if personally present, in accordance with the
following instructions:
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER INSTRUCTED HEREIN
BY THE SIGNED SHAREHOLDER.
IF NO INSTRUCTION IS GIVEN THIS PROXY WILL BE VOTED:
FOR THE ELECTION OF THE NOMINEES AS TRUSTEES,
IN FAVOR OF THE RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP TO SERVE AS
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS, AND
FOR EACH OF THE SIX SINGLE STATE MUNICIPAL BOND SERIES:
IN FAVOR OF AMENDMENT OF THE SERIES' FUNDAMENTAL INVESTMENT RESTRICTIONS TO
ALLOW ADDITIONAL NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATIONS'
RATINGS OF MUNICIPAL SECURITIES BE UTILIZED IN THE DETERMINATION OF
INVESTMENT GRADE SECURITIES ELIGIBLE FOR PURCHASE BY THE SERIES.
DUPREE MUTUAL FUNDS - ANNUAL MEETING TO BE HELD AT THE RADISSON PLAZA HOTEL,
369 WEST VINE STREET, LEXINGTON, KY 40507-1636 AT 10:00 A.M., LEXINGTON
TIME, TUESDAY, OCTOBER 26, 1999
(1) Election Of Trustees, please indicate your vote :
The Nominees are:
Thomas P. Dupree, Sr. Lucy A. Breathitt
Fred L. Dupree, Jr. William A. Combs, Jr.
William T. Griggs II Robert L. Maddox
William S. Patterson
Cumulative voting rights will be exercised in the election of Trustees.
Total proxy votes as to this issue will be distributed among those
individuals selected.
Election Of Trustees
___ FOR ALL Trustees as nominated
___ WITHHOLD authority to vote for any individual nominee, write the name of
the nominee(s) to withhold below.
_____________________________________________________________
___WITHHOLD ALL Nominees - (ABSTAIN FROM)
(2) Ratification or rejection of selection of Independent Certified Public
Accountants
ratification of the selection of Ernst & Young LLP to serve as independent
certified public accountants for the Trust for the fiscal year ending June
30, 2000.
___ FOR ___ AGAINST ___ ABSTAIN FROM
Ratification or rejection of selection of Independent Certified Public
Accountants
(3) Each single state municipal bond series of the Trust will vote separately:
Ratification or rejection of resolution that the Prospectus forming part of
the N-1A be revised to reflect the several ratings services, in addition to
Moody's and Standard & Poor's, which may be consulted for initial ratings of
securities issues and on which the Trust relies, in part, for the selection
of investment grade securities for purchase by one of the several portfolios
of the Trust.
___ FOR ___ AGAINST ___ ABSTAIN FROM
Ratification or rejection of resolution that the Prospectus be revised to
allow additional nationally recognized statistical rating organizations'
ratings of municipal securities be utilized in the determination of
investment grade securities eligible for purchase by the series.
(4) Other Business
use of their discretion in acting upon any and all other matters which may
properly come before the meeting and any adjournments thereof.
___ FOR ___ AGAINST ___ ABSTAIN FROM
Other Business
ATTENDANCE:
___Check this box if you plan to attend the meeting: # _____ Attending
Your shares will be voted as indicated.
Else, if signed and no direction is provided for a given item, it will be
voted as indicated on the reverse.
The signed hereby acknowledges receipt of the accompanying Notice of Annual
Meeting and Proxy Statement, each dated September 17, 1999.
ALL Joint owners MUST sign.
Signed:_____________________________________________ Dated: ____________
Signed:_____________________________________________ Dated: ____________
When signing as attorney, trustee, executor, administrator, custodian,
guardian or corporate officer , please give full title.
THIS IS YOUR PROXY BALLOT, PLEASE:
1. Complete the reverse side
2. Have all owner's sign as designated
3. Tear the proxy at the perforation, and
4. Return your proxy in the reply envelope provided.
Your Vote is Important.
Your prompt return of the proxy will help the Trust avoid the
additional expense of further solicitation to assure a quorum at the meeting.
We hope you will be able to attend the annual shareholder's meeting.
COMMENTS:
