- --------------------------------------------------------------------------------
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-b(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
-------------------------------
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[X] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE>
LORD ABBETT U.S. GOVERNMENT MONEY MARKET FUND, INC.
INVESTMENT MANAGEMENT
THE GM BUILDING 767 FIFTH AVENUE NEW YORK NEW YORK 10153
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders
of the Lord Abbett U.S. Government Securities Money Market Fund, Inc. scheduled
to be held on June 19, 1996, at 11:00 a.m., at the General Motors Building, 767
Fifth Avenue, New York, New York. Your Board of Directors looks forward to
greeting those shareholders who are able to attend.
At the meeting, in addition to the election of directors and approval
of the appointment of auditors, you will be asked to vote on a proposed revision
of the Fund's fundamental investment policies and restrictions, a new 12b-1 Plan
and Distribution Agreement and an amendment to the Fund's Articles of
Incorporation.
Such proposals, if approved, are intended to provide for greater
flexibility in the future management of the Fund's portfolio, as well as to
maintain the competitive position of the Fund.
All proposals are fully described in the enclosed proxy statement. I
encourage you to review the proxy statement for all the details regarding the
meeting agenda.
Your Board of Directors believes these proposals are in the best
interest of the Fund and its shareholders and unanimously recommends a vote
"for" all proposals. Regardless of the number of shares you own, it is
important that they be represented and voted. Accordingly, please sign, date
and mail the enclosed proxy card in the postage-paid return envelope.
Your prompt response will help save the Fund the expense of additional
solicitation.
Sincerely,
/s/ Ronald P. Lynch
Ronald P. Lynch
Chairman of the Board
April 17, 1996
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY
MARKET FUND, INC.
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
JUNE 19, 1996
PROXY STATEMENT
YOU ARE URGED TO SIGN AND MAIL THE PROXY CARD IN THE ENCLOSED
POSTAGE-PAID ENVELOPE WHETHER YOU OWN A FEW OR MANY SHARES.
YOUR PROMPT RETURN OF THE PROXY MAY SAVE THE FUND THE
NECESSITY AND EXPENSE OF FURTHER SOLICITATIONS TO INSURE A
QUORUM AT THIS MEETING.
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
767 Fifth Avenue
New York, New York 10153
Notice of Annual Meeting of Shareholders
To Be Held June 19, 1996 April 17, 1996
Notice is given hereby of an annual meeting of the shareholders of Lord Abbett
U.S. Government Securities Money Market Fund, Inc. (the "Fund"). The meeting
will be held at the offices of Lord, Abbett & Co., on the 11th floor of The
General Motors Building, 767 Fifth Avenue, New York, New York, on Wednesday,
June 19, 1996, at 11:00 a.m., for the following purposes and to transact such
other business as may properly come before the meeting and any adjournments
thereof.
<TABLE>
<CAPTION>
<S> <C>
ITEM 1. To elect directors;
ITEM 2. To ratify or reject the selection of Deloitte & Touche LLP as independent
public accountants of the Fund for the current fiscal year;
ITEM 3. To approve or disapprove certain changes in the Fund's fundamental
investment policies and restrictions;
ITEM 4. To approve or disapprove a new Distribution Plan and Agreement
pursuant to Rule 12b-1 under the Investment Company Act of 1940 with
respect to each new proposed class of shares; and
ITEM 5. To approve or disapprove an amendment to the Fund's Articles of
Incorporation (i) authorizing the Board of Directors to create new classes
and series of shares of capital stock; and (ii) confirming that the board
may impose contingent deferred sales charges in connection with new
classes of shares to be created (this change will have no effect on your
shares).
By order of the Board of Directors
Kenneth B. Cutler
Vice President and Secretary
</TABLE>
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
767 Fifth Avenue
New York, New York 10153
April 17, 1996
PROXY STATEMENT
---------------
This Proxy Statement is furnished in connection with the solicitation
of proxies by and on behalf of the Board of Directors of Lord Abbett U.S.
Government Securities Money Market Fund, Inc., a diversified open-end management
investment company incorporated under the laws of Maryland (the "Fund"), for use
at an annual meeting of shareholders of the Fund to be held at 11:00 a.m. on
Wednesday, June 19, 1996 at the offices of Lord, Abbett & Co., the investment
manager and principal underwriter of the Fund ("Lord Abbett"), on the 11th floor
of the General Motors Building, 767 Fifth Avenue, New York, New York 10153, and
at any adjournments thereof. This proxy statement and the enclosed proxy card
are first being mailed to shareholders on or about April 17, 1996.
At the close of business on March 22, 1996 (the "Record Date"), there
were issued and outstanding 150,931,199 shares of the Fund, of which 150,104,491
shares are to be classified as Class A Shares and 826,708 shares are to be
classified as Class C Shares (see Item 5). Only shareholders of record at the
close of business on the Record Date are entitled to notice of, and to vote at,
the annual meeting or any adjournment thereof. Proxies will be solicited by
mail. Additional solicitations may be made by telephone, facsimile or personal
contact by officers or employees of Lord Abbett and its affiliates. The Fund
may also request brokerage houses, custodians, nominees, and fiduciaries who are
shareholders of record to forward proxy materials to beneficial owners. D.F.
King & Co. has been retained to assist in the solicitation of proxies at an
estimated cost of $8,000. The cost of the solicitation will be borne by the
Fund.
Shareholders are entitled to one vote for each full share, and a pro
portionate vote for each fractional share, of the Fund held as of the Record
Date. Under Maryland law, shares owned by two or more persons (whether as joint
tenants, co-fiduciaries or otherwise) will be voted as follows, unless a written
instrument or court order providing to the contrary has been filed with the
Secretary of the Fund: (1) if only one votes, that vote binds all; (2) if more
- -
than one votes, the vote of the majority binds all; and (3) if more than one
-
votes and the vote is evenly divided, the vote will be cast proportionately. If
the enclosed form of proxy is properly executed
<PAGE>
and returned in time to be voted at the meeting, the proxies named therein will
vote the shares represented by the proxy in accordance with the instructions
marked thereon. Unmarked proxies will be voted FOR each of the items described
in this Proxy Statement and any other matters as deemed appropriate. A proxy
may be revoked by the signer at any time at or before the meeting by written
notice to the Fund, by execution of a later-dated proxy or by voting in person
at the meeting.
1. ELECTION OF DIRECTORS
The nominees for election as directors are Ronald P. Lynch, Robert S.
Dow, E. Thayer Bigelow, Stewart S. Dixon, John C. Jansing, C. Alan MacDonald,
Hansel B. Millican, Jr. and Thomas J. Neff, who have been nominated by the
Board of Directors to succeed themselves. The individuals named as proxies
intend to vote the proxies, unless otherwise directed, in favor of the election
of such nominees, each of whom has agreed to continue to serve as a director of
the Fund. Management of the Fund has no reason to believe that any nominee will
be unable to serve as a director. If any nominee should be unable to serve as a
director, it is the intention of the individuals named as proxies to vote for
the election of such person or persons as the Board of Directors may, in its
discretion, recommend.
Information about each person nominated for election as a director is
set forth in the following table. Except where indicated, each of the persons
listed in the table has held the principal occupation listed opposite his name
for the past five years.
<TABLE>
<CAPTION>
Director of
Names and Ages of Principal Occupation and Director- the Fund
Directors of the Fund ships Since
- ------------------------------- ------------------------------------ -------------
<S> <C> <C>
Ronald P. Lynch /1, 2/ Chairman of the Board of the Fund. 1983
60 Partner of Lord Abbett.
Robert S. Dow /1, 2/ President of the Fund. 1995
51 Partner of Lord Abbett.
E. Thayer Bigelow /2/ President and Chief Executive of Time 1994
54 Warner Cable Programming, Inc.
Formerly President and Chief
Operating Officer of Home Box
Office, Inc.
Stewart S. Dixon /2/ Partner in the law firm of Wildman, 1979
65 Harrold, Allen & Dixon.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Director of
Names and Ages of Principal Occupation and Director- the Fund
Directors of the Fund ships Since
- ------------------------------- ------------------------------------ -------------
<S> <C> <C>
John C. Jansing /2/ Retired. Former Chairman of Inde- 1979
70 pendent Election Corporation of
America, a proxy tabulating firm.
C. Alan MacDonald /2/ General Partner, The Marketing 1988
62 Partnership, Inc., a full service
marketing consulting firm. Formerly
Chairman and Chief Executive Officer
of Lincoln Snacks, Inc., manufacturer
of branded snack foods (1992-1994).
Formerly President and Chief
Executive Officer of Nestle Foods
Corp., and prior to that, President and
Chief Executive Officer of Stouffer
Foods Corp., both subsidiaries of
Nestle SA, Switzerland. Currently
serves as Director of Den West
Restaurant Co., J. B. Williams, and
Fountainhead Water Company.
Hansel B. Millican, Jr. /2/ President and Chief Executive Officer 1983
67 of Rochester Button Company.
Thomas J. Neff /2/ President, Spencer Stuart & Asso- 1983
58 ciates, an executive search consulting
firm.
- --------------------------
</TABLE>
1. "Interested person" of the Fund and Lord Abbett, within the meaning of the
Investment Company Act of 1940, as amended, because of his association with
Lord Abbett.
2. Also a director or trustee of the other Lord Abbett-sponsored funds except
for Lord Abbett Research Fund, Inc., of which only Messrs. Lynch, Dow,
Millican and Neff are directors.
Listed below is the number of shares of the Fund owned beneficially by
each director as of March 22, 1996, together with the number of "phantom" shares
credited to the account of each director under a plan (the "Deferred Plan")
permitting independent directors to defer their directors' fees and to have the
deferred amounts deemed invested in shares of the Fund for later payment. Also
shown is the number of shares owned beneficially by the directors and officers
as a group, together with such "phantom" shares credited to the accounts of
directors as a group. In each
3
<PAGE>
case, except as noted otherwise, the amounts shown are less than 1% of the
Fund's outstanding capital stock.
<TABLE>
<CAPTION>
Number of Shares Beneficially
Name Owned and Phantom Shares/1/
- ---------------------------------- ------------------------------
<S> <C>
Ronald P. Lynch 62,041
Robert S. Dow 3,114
E. Thayer Bigelow 774
Stewart S. Dixon 21,509
John C. Jansing 21,407
C. Alan MacDonald 8,986
Hansel B. Millican, Jr. 23,847
Thomas J. Neff 24,034
Directors and Officers as a group 7,300,772 /2/
</TABLE>
___________________
1. Of the shares listed in the foregoing table, the following constitute
"phantom" shares credited to directors under the Deferred Plan: Mr. Bigelow,
774 shares; Mr. Dixon, 20,816 shares; Mr. Jansing, 21,407 shares; Mr.
MacDonald, 8,986 shares; Mr. Millican, 21,743 shares; Mr. Neff, 21,958
shares; and directors as a group: 95,684 shares.
2. Represents approximately 4.8% of the Fund's outstanding capital stock.
The Board of Directors has only one standing committee, an Audit Committee,
consisting of Messrs. Bigelow, MacDonald and Millican. The functions performed
by the Audit Committee include recommendation of the selection of independent
public accountants for the Fund to the Board of Directors for approval, review
of the scope and results of audit and non-audit services, the adequacy of
internal controls and material changes in accounting principles and practices
and other matters when requested from time to time by the directors (the
"Independent Directors") who are not "interested persons" of the Fund within the
meaning of the Investment Company Act of 1940, as amended (the "Act"). The
Audit Committee held four meetings during the fiscal year ended June 30, 1995.
The Board of Directors of the Fund met ten times during the fiscal year
ended June 30, 1995, and each director attended at least 75% of the total number
of meetings of the board and, if he was a member of the Audit Committee, of such
committee.
4
<PAGE>
The second column of the following table sets forth the compensation accrued
by the Fund for the Independent Directors. The third and fourth columns set
forth information with respect to the retirement plan for Independent Directors
maintained by the Fund and the other Lord Abbett-sponsored funds. The fifth
column sets forth the total compensation accrued by the Fund and such other
funds for the Independent Directors. The second, third and fourth columns give
information for the Fund's most recent fiscal year; the fifth column gives
information for the calendar year ended De cember 31, 1995. No director of the
Fund associated with Lord Abbett and no officer of the Fund received any
compensation from the Fund for acting as a director or officer.
<TABLE>
<CAPTION> For Year Ended
For the Fiscal Year Ended June 30, 1995 December 31, 1995
-------------------------------------------------------- ------------------------
(I) (II) (III) (IV) (V)
- --------------------------- --------------- -------------------- ----------------- ------------------------
Estimated Annual
Benefits Upon Re-
Pension or Retire- tirement Proposed Total
ment Benefits to be Paid by the Compensation
Aggregate Com- Accrued by the Fund and Fifteen Accrued by the
pensation Ac- Fund and Fifteen Other Lord Fund and Fifteen
crued by the Other Lord Abbett- Abbett-sponsored Other Lord Abbett-
Name of Director Fund/1/ sponsored Funds/2/ Funds/2/ sponsored Funds/3/
- --------------------------- --------------- -------------------- ----------------- ----------------------
<S> <C> <C> <C> <C>
E. Thayer Bigelow $413 $ 9,772 $33,600 $41,700
Stewart S. Dixon $581 $22,472 $33,600 $42,000
John C. Jansing $591 $28,480 $33,600 $42,960
C. Alan MacDonald $597 $27,435 $33,600 $42,750
Hansel B. Millican, Jr. $588 $24,707 $33,600 $43,000
Thomas J. Neff $573 $16,126 $33,600 $42,000
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
1. Independent Directors' fees, including attendance fees for board and
committee meetings, are generally allocated among all Lord Abbett-sponsored
funds based on net assets of each fund. A portion of the fees payable by
the Fund to its Independent Directors is being deferred under a plan that
deems the deferred amounts to be invested in shares of the Fund for later
distribution to the directors. The total amount accrued under the plan for
each Independent Director since the beginning of his tenure with the Fund,
including dividends reinvested and changes in net asset value applicable to
such deemed investments, as of June 30, 1995, were as follows: Mr. Bigelow,
$419; Mr. Dixon, $20,151; Mr. Jansing, $20,836; Mr. MacDonald, $8,699; Mr.
Millican, $20,711; and Mr. Neff, $20,929.
2. Each Lord Abbett-sponsored fund has a retirement plan providing that
Independent Directors will receive annual retirement benefits for life
equal to 80% of their final annual retainers following retirement at or
after age 72 with at least 10 years of service. Each plan also
5
<PAGE>
provides for a reduced benefit upon early retirement under certain
circumstances, a pre-retirement death benefit and actuarially reduced
joint-and-survivor spousal benefits. The amounts stated in column (IV)
would be payable annually under such retirement plans if the director were
to retire at age 72 and the annual retainers payable by such funds were the
same as they are today. The amounts set forth in column (III) were accrued
by the Lord Abbett-sponsored funds during the fiscal year ended June 30,
1995 with respect to the retirement benefits set forth in column (IV).
3. This column shows aggregate Independent Directors' fees, including
attendance fees for board and committee meetings, of a nature referred to
in the first sentence of footnote (1), accrued by the Lord Abbett-sponsored
funds during the year ended December 31, 1995.
Listed below are the executive officers of the Fund, other than Messrs.
Lynch and Dow who are listed above in the table of nominees. Each executive
officer has been associated with Lord Abbett for over five years, except as
indicated. Messrs. Allen, Carper, Cutler, Henderson, Morris, Nordberg and Walsh
are partners of Lord Abbett; the others listed below are employees.
Stephen I. Allen, age 42, Vice President since 1994.
Daniel E. Carper, age 44, Vice President since 1986.
Kenneth B. Cutler, age 63, Vice President and Secretary since 1979.
John J. Gargana, Jr., age 64, Vice President since 1979.
Thomas S. Henderson, age 64, Vice President since 1979.
Paul A. Hilstad, age 53, Vice President since 1995 (with Lord Abbett since 1995;
formerly Senior Vice President and General Counsel of American Capital
Management & Research, Inc.).
Thomas F. Konop, age 54, Vice President since 1987.
Robert G. Morris, age 51, Vice President since 1995.
E. Wayne Nordberg, age 59, Vice President since 1988.
Keith F. O'Connor, age 40, Treasurer since 1987.
Victor W. Pizzolato, age 63, Vice President since 1979.
David Seto, age 35, Executive Vice President since 1994.
6
<PAGE>
John J. Walsh, age 60, Vice President since 1979.
Pursuant to the Fund's By-Laws, the election of each director of the Fund
requires the affirmative vote of a majority of the votes cast. If a shareholder
abstains from voting on this matter, then the shares held by such shareholder
shall be deemed present at the meeting for purposes of determining a quorum, but
shall not be deemed to have been voted on this matter. If a broker returns a
"non-vote" proxy, indicating a lack of authority to vote on this matter, then
the shares covered by such non-vote shall be deemed present at the meeting for
purposes of determining a quorum but shall not be deemed to have been voted on
this matter.
The Board of Directors recommends that the shareholders vote FOR the
election of each of the nominees as a director of the Fund.
2. RATIFICATION OR REJECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche LLP as the in
dependent public accountants of the Fund for the fiscal year ending June 30,
1996. The Act requires that such selection be submitted for ratification or
rejection at the next annual meeting of shareholders if such meeting be held.
Deloitte & Touche LLP (or a predecessor firm) acted as the Fund's independent
public accountants for the year ended June 30, 1995, and for a number of years
prior thereto. Based on information in the possession of the Fund, and
information furnished by Deloitte & Touche LLP, the firm has no direct financial
interest and no material indirect financial interest in the Fund. A
representative of Deloitte & Touche LLP is expected to attend the meeting and
will be provided with an opportunity to make a statement and answer appropriate
questions.
Ratification of the selection of Deloitte & Touche LLP requires the
affirmative vote of a majority of the votes cast. If a shareholder abstains
from voting on this matter, then the shares held by such shareholder shall be
deemed present at the meeting for purposes of determining a quorum, but shall
not be deemed to have been voted on this matter. If a broker returns a "non-
vote" proxy, indicating a lack of authority to vote on this matter, then the
shares covered by such non-vote shall be deemed present at the meeting for
purposes of determining a quorum but shall not be deemed to have been voted on
this matter.
7
<PAGE>
The Board of Directors recommends that shareholders vote to ratify the
selection of Deloitte & Touche LLP as the Fund's independent public accountants
for the fiscal year ending June 30, 1996.
3. PROPOSAL TO AMEND THE FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS OF
THE FUND
The Board of Directors has approved various amendments to the Fund's
investment policies and restrictions in order to provide increased flexibility
in managing the Fund's investment portfolio and to provide some uniformity in
the investment policies and restrictions among the various Lord Abbett-sponsored
funds. The Fund's investment policies and restrictions designated "fundamental"
may be changed only by the vote of a "majority" (as defined in the Act) of the
Fund's voting securities. Those investment policies and restrictions designated
"non-fundamental" may be changed by the vote of the Board of Directors alone.
Therefore, the proposed amendments to the fundamental policies and restrictions
described below require shareholder approval. The Fund's current fundamental
investment policies and restrictions and its proposed fundamental and certain
non-fundamental investment policies and restrictions are set forth in Exhibit A
attached hereto.
The Fund's investment policies and restrictions govern generally the
investment activities of the Fund and limit its ability to invest in certain
types of securities or engage in certain types of transactions. The proposed
changes are not expected to affect materially the current operations of the
Fund. The proposed fundamental investment policies and restrictions have been
made less restrictive in order to provide greater flexibility in the future
management of the Fund's investment portfolio and to provide some uniformity
among the Lord Abbett-sponsored funds as noted above. The Board of Directors
has no present intention of approving actions permitted by these less
restrictive fundamental policies and restrictions. If it were to do so, the
risks of investing in the Fund could be increased. No change is proposed with
respect to the Fund's investment objective, which is high current income and
preservation of capital through investments in high-quality, short-term liquid
securities.
The proposed policies and restrictions restate many of the policies and
restrictions currently in effect for the Fund. In some instances, certain
fundamental policies and restrictions have been modified or eliminated in
accordance with developments in Federal or state blue sky regulations or in the
securities markets since the inception of the Fund. In other instances, as
illustrated in Exhibit A, certain policies and restrictions previously deemed
fundamental have been redesignated non-fundamental. By making certain policies
and restrictions non-fundamental, the board may amend a policy or restriction
as it deems appropriate and in the best
8
<PAGE>
interest of the Fund and its shareholders, without incurring the costs (normally
borne by the Fund and its shareholders) of seeking a shareholder vote. Also,
certain of the proposed fundamental investment policies and restrictions are
stated in terms of "to the extent permitted by applicable law". Applicable law
can change over time and may become more or less restrictive as a result. The
policies and restrictions have been drafted in this manner so that a change in
law would not require the Fund to seek a shareholder vote to amend the policy or
restriction to conform to applicable law, as revised.
The principal effect of the proposed amendments will be to permit the Fund
to take certain actions not now permitted to the Fund without obtaining
additional shareholder approval. The Fund either will not be permitted to, or
does not intend to, take any such action unless such action is approved by the
Board of Directors. The board does not now intend to approve any such action or
to do so in the future unless it deems such action to be an appropriate means of
seeking the Fund's investment objective in the best interests of the Fund and
its shareholders, in which case disclosure of the change would be made in the
Fund's then current prospectus or statement of additional information or both.
Such actions, none of which the board has a present intention of approving,
involve the following matters, among others: (i) short sales of securities and
-
purchases of securities on margin to the extent permitted by applicable law;
(ii) loans of portfolio securities to the extent permitted by law; (iii) with
-- ---
respect to 25% of gross assets, purchasing securities of one issuer representing
more than 5% of the gross assets of the Fund; (iv) investments of up to 15% of
--
gross assets in illiquid securities; (v) pledges as permitted by the Fund's
-
investment policies and applicable law; (vi) investments in the securities of
--
other investment companies to the extent permitted by applicable law; (vii)
---
purchases and sales of puts and calls; and (viii) investments of more than 5% of
----
gross assets in securities of issuers in operation for less than three years.
See Exhibit A hereto for a detailed comparison of the Fund's current
fundamental investment policies and restrictions and its proposed fundamental
and certain non-fundamental investment policies and restrictions.
Approval of the proposed amendments to the Fund's fundamental investment
policies and restrictions requires the affirmative vote of a "majority" (as
defined in the Act) of the Fund's voting securities. A "majority" vote is
defined in the Act as the vote of the holders of the lesser of: (i) 67% or more
-
of the voting securities present or represented by proxy at the shareholders
meeting, if the holders of more than 50% of the outstanding voting securities
are present or represented by proxy, or (ii) more than 50% of the outstanding
--
voting securities. The effect of an abstention or broker non-vote is the same
as a vote against this proposal.
9
<PAGE>
If the proposed amendments are not approved by the shareholders of the
Fund, the current fundamental policies and restrictions will continue in effect.
The Board of Directors recommends that shareholders vote in favor of the
proposed amendments to the Fund's fundamental investment policies and
restrictions.
4. NEW DISTRIBUTION PLANS AND AGREEMENTS FOR THE
CLASS A AND CLASS C SHARES
At a meeting of the Board of Directors of the Fund held on March 14, 1996,
the directors of the Fund unanimously approved, subject to shareholder approval,
and determined to submit to the shareholders for approval, a new Distribution
Plan and Agreement pursuant to Rule 12b-1 under the Act (i) with respect to
-
shares purchased for cash or acquired through exchange for shares of one or more
of the other Lord Abbett-sponsored funds other than Lord Abbett Securities
Trust, which shares are to be designated the "Class A Shares" (the "Proposed A
Plan") and (ii) with respect to shares acquired through exchange for shares of
--
Lord Abbett Securities Trust, which shares are to be designated the "Class C
Shares" (the "Proposed C Plan"). See Item 5 below for a more detailed
description of the two classes that are to be created out of the existing class
of Fund shares. The texts of the Proposed Plans are attached hereto as Exhibit
B-1 and B-2, respectively. The directors who approved each Proposed Plan
include all of the Independent Directors, none of whom is an "interested person"
of the Fund within the meaning of the Act or has a direct or indirect financial
interest in the operations of either Proposed Plan or in any agreements related
thereto.
If approved by shareholders, the Proposed Plans will replace a dis
tribution plan and agreement with respect to all shareholders of the Fund (the
"Current Plan") that was approved by shareholders on March 14, 1990 and became
effective June 1, 1990. The Current Plan was last amended by action of the
Board of Directors on September 1, 1994. No payments are being made under the
Current Plan, which has been suspended by Lord Abbett since July 1, 1992.
Similarly, no payments are expected to be made in the near future under the
Proposed A Plan or the Proposed C Plan, both of which are to be suspended by
Lord Abbett beginning on the date of their adoption by shareholders. The
principal reason for creating the Proposed A and Proposed C Plans is to
separate, in conjunction with the classification of shares described in Section
5 below, the distribution arrangements for two groups of shares which, though
currently part of the same class of shares, have different exchange
privileges.
Under the Current Plan (except as to certain accounts for which
10
<PAGE>
tracking data is not available), the Fund is authorized to pay to dealers
through Lord Abbett an annual service fee (payable quarterly) of 0.15% of the
average daily net asset value of shares sold by dealers. These service fees are
intended to provide additional incentives for dealers (a) to provide continuing
-
information and investment services to their shareholder accounts and otherwise
to encourage their accounts to remain invested in the Fund and (b) to sell
-
shares of the Fund.
Under the Current Plan, holders of shares acquired through exchange for
shares of another Lord Abbett-sponsored fund may be required to pay to the Fund
on redemption a contingent deferred reimbursement charge ("CDRC") of 1% of the
original cost of the shares surrendered in exchange or the net asset value of
the shares of the Fund so redeemed. If the redeemed shares were received in
exchange for shares of a Lord Abbett-sponsored fund other than Lord Abbett
Securities Trust and if a 1% distribution fee was paid by such other fund in
connection with the purchase of such shares, a CDRC is payable if such Fund
shares are redeemed for cash on or before the end of the twenty-fourth month
after the month in which the initial purchase occurred (an exception is made for
certain redemptions by tax-qualified plans under Section 401 of the Internal
Revenue Code due to plan loans, hardship withdrawal, death, retirement or
separation from service with respect to plan participants). If the redeemed
shares were received in exchange for shares of Lord Abbett Securities Trust, a
CDRC is payable if the original shares were purchased less than a year before
the redemption for cash.
Set forth below is a description of the principal changes to be effected
under the Proposed Plans:
(a) Level of Service Fees. Under the Proposed A Plan, the Fund will be
---------------------
authorized to pay an annual service fee of 0.15%, while such service fee under
the Proposed C Plan will be 0.25%. As noted above, however, no payments are
expected to be made in the near future under the Proposed A Plan or the Proposed
C Plan, both of which are to be suspended beginning on the date of their
adoption by shareholders.
(b) Categories of Persons Eligible to Receive Payments. Service fee
--------------------------------------------------
payments under the Proposed Plans could be made to all Authorized Institutions
(institutions and persons permitted by applicable law and/or rules to receive
such payments), rather than just to dealers as is the case under the Current
Plan.
(c) Use of Payments by Lord Abbett. Lord Abbett would be permitted to use
------------------------------
payments received under the Proposed Plans to provide continuing services to
shareholder accounts not serviced by Authorized Institutions.
11
<PAGE>
(d) CDRC. The CDRC payable under the Proposed A Plan would be
----
substantially similar to that payable under the Current Plan with respect to
shares acquired through exchange for shares of a Lord Abbett-sponsored fund
other than Lord Abbett Securities Trust, and the CDRC payable under the Proposed
C Plan would be substantially similar to that payable under the Current Plan
with respect to shares acquired through exchange for shares of Lord Abbett
Securities Trust, except that, in each case, no CDRC would be payable in
connection with redemptions by retirement plans (not just those qualified under
Section 401 of the Internal Revenue Code) attributable to any benefit payment.
In addition, no CDRC would apply if the plan sponsor requested a redemption to
correct an excess contribution in order to comply with applicable IRS
rules.
(e) Lord Abbett Distributor. The other party to the Proposed Plans is to
-----------------------
be Lord Abbett Distributor LLC, a New York limited liability company, to be
formed as a subsidiary of Lord Abbett ("Lord Abbett Distributor"), rather than
Lord Abbett. Lord Abbett Distributor is to take on all the underwriting
functions currently performed directly by Lord Abbett.
In considering whether to recommend the Proposed Plans for approval, the
board considered, among other things, the factors set forth below:
(i) Expanding Categories of Persons Eligible to Receive Payments. The
------------------------------------------------------------
Current Plan limits payments thereunder to dealers. Since that plan was
adopted, different methods of distribution, using different entities, have
developed in the industry. The Board of Directors sees no reason to limit the
categories of persons eligible to receive payments under the Proposed Plans and
believes that the availability of payments under the plans will induce such
other entities to invest in Class A and Class C Shares.
(ii) Flexibility in Distributor's Use of Payments. Lord Abbett has advised
--------------------------------------------
the Board of Directors of the Fund that allowing Lord Abbett Distributor to
retain fees received from the Fund to provide continuing information and
investment services to shareholder accounts will provide useful flexibility and
will be in line with common practice in the industry.
In light of the anticipated benefits to the Fund and its shareholders as a
result of adopting the Proposed Plans, the directors of the Fund have concluded,
in the exercise of reasonable business judgment and in light of their fiduciary
duties, that there is a reasonable likelihood that each of the Proposed Plans
will benefit the Fund, the Class A Shares and the Class C Shares and their
shareholders, respectively. There can, however, be no assurance that the
anticipated benefits will be realized.
12
<PAGE>
Set forth in the table below is a summary comparison of the Fund's
expenses, on a current and pro-forma basis, taking into account the fees that
could be paid under the Proposed A and C Plans. The annual operating expenses
shown in the second column are the Fund's actual expenses for the fiscal year
ended June 30, 1995. The expenses shown in the third and fourth columns
represent, on a pro-forma basis, such actual expenses of the Fund adjusted to
show the effect of the maximum service fees the board has authorized under the
Proposed A and C Plans, which fees are to be suspended indefinitely by Lord
Abbett. The example set forth below is not a representation of past or future
expenses. Actual expenses may be greater or less than those shown.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
I II III IV
- -----------------------------------------------------------------------------------------------------
Pro-Forma
Pro-Forma (reflecting
Year ended (reflecting estimated amounts
June 30, 1995 maximum amounts that would have
(reflecting payable under the been paid under
CLASS A SHARES the Current Plan) Proposed Plan the Proposed Plan
-----------------
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
(AS A PERCENTAGE OF OFFERING PRICE)
- -----------------------------------------------------------------------------------------------------
Maximum Sales Load/1/ on Purchases None None None
Deferred Sales Load/1/ None/2/ None/2/ None/2/
- -----------------------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
- -----------------------------------------------------------------------------------------------------
Management Fee 0.50% 0.50% 0.50%
12b-1 Fees 0.00%/3/ 0.15%/3/ 0.00%/3/
Other Expenses 0.36% 0.36% 0.36%
- -----------------------------------------------------------------------------------------------------
Total Operating Expenses 0.86% 1.01% 0.86%
- -----------------------------------------------------------------------------------------------------
</TABLE>
Example: Assume an annual return of 5% and there is no change in the level of
- -------
expenses described above. For every $1,000 invested, with reinvestment of all
distributions, you would pay the following total expenses if you closed your
account after the number of years indicated.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CURRENT $9/3,4/ $27/3,4/ $48/3,4/ $106/3,4/
- -----------------------------------------------------------------------------------------------------
PRO-FORMA (MAXIMUM) $10/4/ $32/4/ $56/4/ $124/4/
- -----------------------------------------------------------------------------------------------------
PRO-FORMA (ESTIMATED) $9/4/ $27/4/ $48/4/ $106/4/
- -----------------------------------------------------------------------------------------------------
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
I II III IV
- -----------------------------------------------------------------------------------------------------
Pro-Forma
Pro-Forma (reflecting
Year ended (reflecting estimated amounts
June 30, 1995 maximum amounts that would have
(reflecting payable under the been paid under
CLASS C SHARES the Current Plan) Proposed Plan the Proposed Plan
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
(AS A PERCENTAGE OF OFFERING PRICE)
- -----------------------------------------------------------------------------------------------------
Maximum Sales Load/1/ on Purchases None None None
Deferred Sales Load/1/ None/2/ None/2/ None/2/
- -----------------------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
- -----------------------------------------------------------------------------------------------------
Management Fee 0.50% 0.50% 0.50%
12b-1 Fees 0.00%/3/ 0.25%/3/ 0.00%/3/
Other Expenses 0.36% 0.36% 0.36%
- -----------------------------------------------------------------------------------------------------
Total Operating Expenses 0.86% 1.11% 0.86%
- -----------------------------------------------------------------------------------------------------
</TABLE>
Example: Assume an annual return of 5% and there is no change in the level of
- -------
expenses described above. For every $1,000 invested, with reinvestment of all
distributions, you would pay the following total expenses if you closed your
account after the number of years indicated.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CURRENT $9/3,4/ $27/3,4/ $48/3,4/ $106/3,4/
- -----------------------------------------------------------------------------------------------------
PRO-FORMA (MAXIMUM) $11/4/ $35/4/ $61/4/ $135/4/
- -----------------------------------------------------------------------------------------------------
PRO-FORMA (ESTIMATED) $9/4/ $27/4/ $48/4/ $106/4/
- -----------------------------------------------------------------------------------------------------
</TABLE>
1. Sales "load" is referred to as sales "charge" and "deferred sales load" is
referred to as "contingent deferred reimbursement charge" or "CDRC"
throughout this Proxy Statement.
2. Under both the Current Plan and the Proposed A and C Plans, holders of
shares acquired through exchange for shares of another Lord Abbett-
sponsored fund may be required to pay a CDRC on redemption of up to 1% of
the original cost of the shares surrendered in exchange or the net asset
value of the shares of the Fund so redeemed. See above under Item 4.
3. This figure omits Rule 12b-1 fees because no payments are being made under
the Current Plan, which has been suspended since July 1, 1992. If the
Proposed A Plan were to become operative, the Fund could pay a maximum
annual service fee of 0.15% of net assets on behalf of the Class A Shares
thereunder, and if the Proposed C Plan were to become operative, the Fund
could pay a maximum annual service fee of 0.25% of net assets on behalf of
the Class C Shares thereunder. These figures are shown even though no
payments are
14
<PAGE>
expected to be made in the near future under the Proposed A Plan or the
Proposed C Plan, both of which are to be suspended beginning on the date of
their adoption by shareholders.
4. Based on total current and pro-forma operating expenses shown in the table
above.
If the shareholders approve the Proposed Plans, the Proposed Plans shall,
unless terminated as described below, become effective July 12, 1996 and
continue in effect until July 12, 1997 and from year to year thereafter only so
long as such continuance is specifically approved, at least annually, by the
Fund's Board of Directors and its Independent Directors by a vote cast in person
at a meeting called for the purpose of voting on such continuance. The Proposed
Plans may be terminated at any time by a vote of a majority of the Independent
Directors or by a shareholder vote in compliance with Rule 12b-1 under the Act.
All material amendments must be approved by a majority of the Independent
Directors.
Each Proposed Plan provides that while it is in effect, the selection and
nomination of Independent Directors is committed to the discretion of the
Independent Directors then sitting on the board. This does not prevent the
involvement of others in such selection and nomination if the final decision on
any such selection or nomination is approved by a majority of the Independent
Directors.
Pursuant to Rule 12b-1 under the Act, an affirmative vote of the holders of
a "majority" (as defined in the Act) of the shares to be designated Class A
Shares is required for approval of the Proposed A Plan and a "majority" (as so
defined) of the shares to be designated Class C Shares is required for approval
of the proposed C Share Plan. A "majority" vote of shares is defined in the Act
as the vote of the holders of the lesser of: (i) 67% or more of such shares
-
present or represented by proxy at the shareholders meeting, if the holders of
more than 50% of such shares are present or represented by proxy, or (ii) more
--
than 50% of such shares that are outstanding. The effect of an abstention or
broker non-vote is the same as a vote against this proposal.
If a Proposed Plan is not approved by the holders of the shares to be
designated Class A Shares or the shares to be designated Class C Shares, the
Current Plan will continue in effect according to its terms for such
shares.
The Board of Directors recommends that shareholders vote in favor of
adoption of the Proposed A Plan and the Proposed C Plan, as the case may
be.
15
<PAGE>
5. AMENDMENT OF THE ARTICLES OF INCORPORATION TO AUTHORIZE CLASSES AND SERIES
OF SHARES AND TO CONFIRM THAT THE FUND MAY IMPOSE CONTINGENT DEFERRED SALES
CHARGES IN CONNECTION WITH REDEMPTIONS
On March 14, 1996, the Fund's Board of Directors unanimously voted to
approve an amendment to the Articles of Incorporation of the Fund to give the
Fund's Board of Directors the power to classify the Fund's shares into classes
and series, and voted to submit such amendment to the Fund's shareholders for
approval. The full text of the amendment is attached hereto as Exhibit C.
The Fund's Articles of Incorporation presently designate one class of
shares of capital stock and do not authorize the Board of Directors to create
additional classes or series. The Board of Directors believes that the Fund's
best interests will be served if the Board of Directors is able to create new
series of shares and classes of shares within a series, with each share of a
series, regardless of class, sharing pro rata (based on net asset value) in the
portfolio and income of the series and in the series' expenses, except for
differences in expenses resulting from different Rule 12b-1 plans for the
various classes and possibly other class-specific expenses. It is expected that
implementation of such a multi-class fund structure will (i) facilitate
-
exchanges into Fund shares by investors holding shares (Class A, Class C and
probably one or more other classes) in other Lord Abbett-sponsored funds, (ii)
--
enable investors in the Fund to choose the distribution option that best suits
their individual situations, (iii) facilitate distribution of the Fund's shares,
---
and (iv) maintain the competitive position of the Fund in relation to other
--
funds that have implemented or are seeking to implement similar distribution
arrangements.
The Board of Directors has approved, subject to shareholder approval of the
proposed amendment, two classes of shares which are to share in the Fund's
portfolio but are to have different Rule 12b-1 distribution plans (see Item 4
above). Holders of the existing class of Fund shares have acquired their shares
in one of three ways: (i) through a purchase for cash, (ii) through exchange
- --
for shares of one or more of the other Lord Abbett-sponsored funds other than
Lord Abbett Securities Trust, or (iii) through exchange for shares of a series
---
of Lord Abbett Securities Trust. Shares acquired in the manner described in
clause (i) or (ii) will be designated the "Class A Shares" and will continue to
be offered as described in the Fund's current prospectus, except that the Board
of Directors is recommending that shareholders approve a new Distribution Plan
and Agreement pursuant to Rule 12b-1 under the Act that, if approved, will be
applicable to the Class A Shares. See Item 4 above. Shares acquired
in the manner described in the foregoing clause (iii) will be designated the
"Class C Shares" and will also continue to be offered as described in the Fund's
current prospectus, except that the Board of Directors is recommending that
shareholders approve a new Distribution Plan and Agreement pursuant to Rule
16
<PAGE>
12b-1 under the Act that, if approved, will be applicable to the Class C Shares.
See Item 4 above.
If the proposed amendment to the Fund's Articles of Incorporation is
approved, the Board of Directors will be authorized to create and issue one or
more additional classes of shares within the existing series and to create
additional series. Lord Abbett has advised the Board of Directors of the Fund
that it intends to propose to the board in the near future that the board
authorize the Fund to create a third class of shares, to be designated the
"Class B Shares," to be issued in exchange for Class B Shares of other Lord
Abbett-sponsored funds and as described in the Fund's then-current prospectus.
If authorized, the Class B Shares are expected to be similar to the Class C
Shares except that (i) they will be subject to a contingent deferred sales
-
charge ("CDSC") that is payable to the distributor of such shares, rather than
subject to a contingent deferred reimbursement charge payable to the Fund as in
the case with the Class C Shares (see Item 4 above for a description of the
Class C Share CDRC), (ii) the B Share CDSC will be substantially larger than the
--
1% CDRC charged on early redemptions of Class C Shares, (iii) the B Share CDSC
---
will apply over a period of time substantially longer than the 12 months
applicable to the C Share CDRC, and will scale down to zero over that longer
period, and (iv) the Class B Shares will convert automatically into Class A
--
Shares at net asset value after a period of time.
Shares of all classes will vote together on all matters affecting the Fund,
except for matters, such as approval of a Rule 12b-1 plan or a related service
plan, affecting only a particular class or classes. All shares voting on a
matter will have identical voting rights. All issued shares will be fully paid
and non-assessable, and shareholders will have no pre-emptive or other right to
subscribe to any additional shares. All shares within a series will have the
same rights and be subject to the same limitations set forth in the Articles of
Incorporation with respect to dividends, redemptions and liquidation except for
differences resulting from class-specific Rule 12b-1 plans and related service
plans and certain other class-specific expenses.
The proposed amendment to the Fund's Articles of Incorporation will also
make clear that the Fund may impose a CDSC and other charges (which charges may
vary within and among the classes) payable upon redemption as may be estab
lished from time to time by the Board of Directors of the Fund. The Fund's
Articles of Incorporation currently provide that the Fund may deduct a
redemption charge not exceeding 1% of the net asset value of the shares being
redeemed. The proposed amendment is deemed advisable in order to avoid any
question as to whether a CDSC in excess of 1% may be imposed in connection with
the issuance of future classes or series of the Fund's shares. The Board of
Directors has no intention of imposing a CDSC on early redemptions of your Class
A or Class C Shares.
17
<PAGE>
Approval of the proposed amendment to the Articles of Incorporation
requires an affirmative vote of a majority of each of (i) the outstanding shares
-
to be designated "Class A Shares" and (ii) the outstanding shares of the Fund.
The effect of an abstention or broker non-vote is the same as a vote against
this proposal.
The Board of Directors recommends that shareholders vote in favor of this
proposed amendment to the Articles of Incorporation.
6. OTHER INFORMATION
Management is not aware of any matters to come before the meeting other
than those set forth in the notice. If any such other matters do come before
the meeting, the individuals named as proxies will vote, act, and consent with
respect thereto in accordance with their best judgment.
a. Timeliness of Shareholder Proposals.
-----------------------------------
Any shareholder proposals to be presented for action at the Fund's next
shareholder meeting pursuant to the provisions of Rule 14a-8 under the
Securities Exchange Act of 1934, as amended, must be received at the Fund's
principal executive offices within a reasonable time in advance of the date
solicitation is made for such meeting. The Fund does not intend to hold another
annual or special meeting of shareholders unless required to do so by the Act.
b. Investment Adviser and Underwriter.
----------------------------------
Lord, Abbett & Co., 767 Fifth Avenue, New York, New York, 10153, acts as
investment adviser and principal underwriter with respect to the Fund.
c. Annual Report Available Upon Request.
------------------------------------
The Fund will furnish, without charge, a copy of the Fund's most recent
annual report and the most recent semi-annual report succeeding the annual
report, if any, to a shareholder upon request. A shareholder may obtain such
report(s) by writing to the Fund or by calling 800-874-3733.
d. Portfolio Transactions.
----------------------
Purchases and sales of portfolio securities usually will be principal
transactions and normally such securities will be purchased directly from the
issuer or from an underwriter or purchased from or sold to a market maker for
the securities. Therefore, the Fund usually will pay no brokerage commissions
on such transactions.
18
<PAGE>
Purchases from underwriters of portfolio securities will include a commission or
concession paid by the issuer to the underwriter and purchases from or sales to
dealers serving as market makers will include a dealer's markup or markdown.
Principal transactions, including riskless principal transactions, are not
afforded the protection of the safe harbor in Section 28(e) of the Securities
Exchange Act of 1934.
The Fund's policy is to obtain best execution on all portfolio
transactions, which means that the Fund seeks to have purchases and sales of
portfolio securities executed at the most favorable prices, considering all
costs of the transaction including dealer markups and markdowns and any
brokerage commissions. This policy governs the selection of dealers and brokers
and the market in which the transaction is executed. To the extent permitted by
law, the Fund may, if considered advantageous, make a purchase from or sale to
another Lord Abbett-sponsored fund without the intervention of any broker-
dealer.
The Fund selects broker-dealers on the basis of their professional
capability and the value and quality of their brokerage and research services.
Normally, the selection is made by traders who are officers of the Fund and also
are employees of Lord Abbett. These traders do the trading as well for other
accounts -- investment companies (of which they are also officers) and other
investment clients -- managed by Lord Abbett. They are responsible for the
negotiation of prices and any commissions.
The Fund may pay a brokerage commission on the purchase or sale of a
security that could be purchased from or sold to a market maker if the Fund's
net cost of the purchase or the net proceeds to the Fund of the sale are at
least as favorable as the Fund could obtain on a direct purchase or sale.
Brokers who receive such commissions may also provide research services at least
some of which are useful to Lord Abbett in their overall responsibilities with
respect to the Fund and the other accounts they manage. Research includes
trading equipment and computer software packages, acquired from third-party
suppliers, that enable Lord Abbett to access various information bases and may
include the furnishing of analyses and reports concerning issuers, industries,
securities, economic factors and trends, portfolio strategy and the performance
of accounts. Such services may be used by Lord Abbett in servicing all their
accounts, and not all of such services will necessarily be used by Lord Abbett
in connection with their management of the Fund; conversely, such services
furnished in connection with brokerage on other accounts managed by Lord Abbett
may be used in connection with their management of the Fund, and not all of such
services will necessarily be used by Lord Abbett in connection with their
advisory services to such other accounts. The Fund has been advised by Lord
Abbett that research services received from brokers cannot be allocated to any
particular account, are not a substitute for Lord Abbett's services but are
supplemental to their own research effort and, when utilized, are subject
to
19
<PAGE>
internal analysis before being incorporated by Lord Abbett into their investment
process. As a practical matter, it would not be possible for Lord Abbett to
generate all of the information presently provided by brokers. While receipt of
research services from brokerage firms has not reduced Lord Abbett's normal
research activities, the expenses of Lord Abbett could be materially increased
if it purchased such equipment and software packages directly from the
suppliers and attempted to generate such additional information through its own
staff. No commitments are made regarding the allocation of brokerage business to
or among brokers and trades are executed only when they are dictated by
investment decisions of the Fund to purchase or sell portfolio securities.
If two or more broker-dealers are considered capable of offering the
equivalent likelihood of best execution, the broker-dealer who has sold the
Fund's shares and/or shares of other Lord Abbett-sponsored funds may be
preferred.
If other clients of Lord Abbett buy or sell the same security at the same
time as the Fund, transactions will, to the extent practicable, be allocated
among all participating accounts in proportion to the amount of each order and
will be executed daily until filled so that each account shares the average
price and commission cost of each day. Other clients who direct that their
brokerage business be placed with specific brokers or who invest through wrap
accounts introduced to Lord Abbett by certain brokers may not participate with
the Fund in the buying and selling of the same securities as described above. If
these clients wish to buy or sell the same security as the Fund does, they may
have their transactions executed at times different from the Fund's transactions
and thus may not receive the same price or incur the same commission cost as
the Fund does.
The Fund will not seek "reciprocal" dealer business (for the purpose of
applying commissions in whole or in part for the Fund's benefit or otherwise)
from broker-dealers as consideration for the direction to them of portfolio
business.
For the fiscal years ended June 30, 1995, 1994 and 1993, the Fund paid no
commissions to independent broker-dealers.
LORD ABBETT U.S. GOVERNMENT
SECURITIES MONEY MARKET
FUND, INC.
Kenneth B. Cutler
Vice President and Secretary
20
<PAGE>
COMPARISON OF CURRENT FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS AND
PROPOSED FUNDAMENTAL AND CERTAIN NON-FUNDAMENTAL INVESTMENT POLICIES AND
RESTRICTIONS
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
INVESTMENTS IN COMMON STOCK.
FUNDAMENTAL FUNDAMENTAL
The Fund may not buy common stocks or other voting The Fund may not buy common stocks or other voting
securities. securities.
- ----------------------------------------------------------------------------------------------------------------------------------
SHORT SALES/MARGIN.
FUNDAMENTAL FUNDAMENTAl
The Fund may not sell short or buy on margin The Fund may purchase securities on margin to the
(except for such short-term credits as are extent permitted by applicable law.
necessary for the clearance of transactions).
NON-FUNDAMENTAL
The Fund may not make short sales of securities or maintain
a short position except to the extent permitted by applicable law.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- -------------------------------------------------- -----------------------------------------------------------------------------
<S> <C>
BORROWING.
FUNDAMENTAL FUNDAMENTAL
The Fund may not borrow money, except from banks The Fund may not borrow money, except that (i) the Fund may borrow from banks
(a) as a temporary measure for extraordinary or (as defined in the Act) in amounts up to 33 1/3% of its total assets (including
emergency purposes and then only in amounts up to the amount borrowed), (ii) the Fund may bor row up to an additional 5% of its
5% of Fund assets taken at cost or (b) in an total assets for temporary purposes, and (iii) the Fund may obtain such
amount up to 33 1/3% of total Fund assets in order short-term credit as may be necessary for the clear ance of purchases and
to meet redemption requests which might otherwise sales of portfolio securities.
require untimely disposition of portfolio
securities (the Fund will repay all borrowings NON-FUNDAMENTAL
before making additional investments and interest The Fund may not borrow in excess of 5% of its gross assets taken at cost or
paid on any such borrowings will reduce net market value, whichever is lower at the time of borrowing, and then only as a
income). temporary measure for extraordinary or emergency purposes.
- -------------------------------------------------- -----------------------------------------------------------------------------
UNDERWRITING.
FUNDAMENTAL FUNDAMENTAL
The Fund may not engage in the underwriting of any The Fund may not engage in the under writing of securities, except pursuant to
security issued by other persons except to the a merger or acquisition or to the extent that, in connection with the
extent that in selling portfolio securities the disposition of its portfolio securities, it may be deemed to be an underwriter
Fund may be deemed to be an underwriter under under federal securities laws.
federal securities laws.
- -------------------------------------------------- -----------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- -------------------------------------------------- -----------------------------------------------------------------------------
<S> <C>
LENDING.
FUNDAMENTAL FUNDAMENTAL
The Fund may not make loans, except for (a) time The Fund may not make loans to other persons, except that the acquisition of
or demand deposits with banks, (b) purchasing bonds, debentures or other corporate debt securities and investment in
commercial paper or publicly-offered debt government obligations, commercial paper, pass-through instruments,
securities at original issue or otherwise, (c) certificates of depos it, bankers acceptances, repurchase agree ments or any
repurchase agreements (to the extent they may be similar instruments shall not be subject to this limitation, and except
considered loans) with sellers of securities the further that the Fund may lend its portfolio securities, provided that the
Fund has bought provided not more than 10% of lending of portfolio securities may be made only in accordance with applicable
Fund assets, taken at cost, may be invested in law.
repurchase agreements maturing in more than seven
days and (d) loans of Fund portfolio securities
to registered broker-dealers if 100% secured by
cash or cash equivalents, made in full compliance
with applicable regulations and which, in
management's opinion, do not expose the Fund to
significant risks.
- -------------------------------------------------- -----------------------------------------------------------------------------
REAL ESTATE/COMMODITIES.
FUNDAMENTAL FUNDAMENTAL
The Fund may not buy or sell real estate, although The Fund may not buy or sell real estate, although the Fund may buy short-term
the Fund may buy short-term securities secured by securities secured by real estate or interests therein, or issued by companies
real estate or interests therein, or issued by which invest in real estate or interests therein. The Fund may not buy or
companies which invest in real estate or sell commodities or commodity contracts, interests in oil, gas or other
interests therein. The Fund may not buy or sell mineral exploration or development programs.
commodities or commodity contracts, interests in
oil, gas or other mineral exploration or
development programs.
- -------------------------------------------------- -----------------------------------------------------------------------------
DIVERSIFICATION.
FUNDAMENTAL FUNDAMENTAL
The Fund may not buy securities of an issuer if With respect to 75% of its gross assets, the Fund may not buy securities of
the purchase would then cause more than 5% of one issuer representing more than 5% of the Fund's gross assets, except
Fund assets, taken at cost, to be invested in the securities issued or guaranteed by the U.S. Govern ment, its agencies or
securities of any one issuer, except the U.S. instrumentalities.
Government, its agencies or instrumentalities.
- -------------------------------------------------- -----------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- -------------------------------------------------- -----------------------------------------------------------------------------
<S> <C>
INVESTMENT IN A SINGLE INDUSTRY.
FUNDAMENTAL FUNDAMENTAL
The Fund may not invest 25% or more of the value The Fund may not invest more than 25% of its assets, taken at market value, in
of its assets in securities of issuers in any one the securities of issuers in any particular in dustry (excluding U.S.
industry, except the Fund may invest more than Government securities as described in the Fund's prospectus).
25% in short-term securities issued by the U.S.
Government or its agencies or instrumentalities,
finance companies, or banks or bank holding
companies.
- -------------------------------------------------- -----------------------------------------------------------------------------
RESTRICTED/ILLIQUID SECURITIES.
FUNDAMENTAL NON-FUNDAMENTAL
The Fund may not acquire securities with The Fund may not invest knowingly more than 15% of its net assets (at the time
contractual or other restrictions on resale, of investment) in illiquid securities, except for securities qualifying for
except in connection with repurchase agreements. resale under Rule 144A of the Securities Act of 1933, deemed to be liquid by
the Board of Directors.
- -------------------------------------------------- -----------------------------------------------------------------------------
MORTGAGING AND PLEDGING OF ASSETS.
FUNDAMENTAL
The Fund may not pledge, mortgage or hypothecate FUNDAMENTAL
its assets except to secure borrowings as may be The Fund may not pledge its assets (other than to secure borrowings, or to the
permissible under "BORROWING" above, and in an extent permitted by the Fund's investment policies, as permitted by applicable
aggregate amount not to exceed 10% of its net law.
assets.
- -------------------------------------------------- -----------------------------------------------------------------------------
INVESTMENTS IN SECURITIES OF OTHER INVESTMENT
COMPANIES.
FUNDAMENTAL NON-FUNDAMENTAL
The Fund may not buy securities of other The Fund may not invest in the securities of other investment companies,
investment companies, except in connection with a except as permitted by applicable law.
merger, consolidation, acquisition or
reorganization.
- -------------------------------------------------- -----------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- -------------------------------------------------- -----------------------------------------------------------------------------
<S> <C>
OPTIONS.
FUNDAMENTAL NON-FUNDAMENTAL
The Fund may not write or buy put or call options. The Fund may not write, purchase or sell puts, calls, straddles, spreads or
combinations thereof, except to the extent permitted in the Fund's prospectus
and statement of additional information, as they may be amended from time to
time.
- -------------------------------------------------- -----------------------------------------------------------------------------
INVESTMENTS IN SECURITIES OF ISSUERS IN OPERATION
FOR LESS THAN THREE YEARS.
FUNDAMENTAL
The Fund may not buy the securities of a company, NON-FUNDAMENTAL
which (including predecessors) has a record of The Fund may not invest in securities of issuers which, with their
less than three years' continuous operation if predecessors, have a record of less than three years continuous operations, if
such purchase would then cause more than 5% of more than 5% of the Fund's total assets would be invested in such securities
Fund assets to be invested in the securities of (this restriction shall not apply to mortgage-backed securities, asset-backed
such companies. securities or obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities).
- -------------------------------------------------- -----------------------------------------------------------------------------
OWNERSHIP OF PORTFOLIO SECURITIES BY OFFICERS AND
DIRECTORS.
FUNDAMENTAL
The Fund may not buy or hold the outstanding NON-FUNDAMENTAL
securities of any issuer if, to the knowledge of The Fund may not hold securities of any issuer if more than 1/2 of 1% of the
management, such securities of Fund officers and securities of such issuer are owned beneficially by one or more officers or
directors and the partners of Lord Abbett each of directors of the Fund or by one or more partners or members of the underwriter
whom owns beneficially more than 1/2 of 1% of or investment advisor if these owners in the aggregate own beneficially more
such securities, together own beneficially more than 5% of the securities of such issuer.
than 5% of such securities.
- -------------------------------------------------- -----------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
- -------------------------------------------------- -----------------------------------------------------------------------------
<S> <C>
TRANSACTIONS WITH CERTAIN PERSONS.
No policy/restriction stated. NON-FUNDAMENTAL
The Fund may not buy from or sell to any of its officers, directors,
employees, or its investment adviser or any of its officers, directors,
partners or employees, any securities other than shares of the Fund's common
stock.
- -------------------------------------------------- -----------------------------------------------------------------------------
SENIOR SECURITIES.
No policy/restriction stated. FUNDAMENTAL
The Fund may not issue senior securities to the extent such issuance would
violate applicable law.
- -------------------------------------------------- -----------------------------------------------------------------------------
PURCHASE OF WARRANTS.
No policy/restriction stated. NON-FUNDAMENTAL
The Fund may not invest in warrants if, at the time of the acquisition, its
investment in warrants, valued at the lower of cost or market, would exceed 5%
of the Fund's total assets (included within such limitation, but not to exceed
2% of the Fund's total assets, are warrants which are not listed on the New
York or American Stock Exchange or a major foreign exchange).
- -------------------------------------------------- -----------------------------------------------------------------------------
</TABLE>
6
<PAGE>
EXHIBIT B-1
Rule 12b-1 Distribution Plan and Agreement
Lord Abbett U.S. Government Securities Money Market Fund, Inc. -- Class A Shares
- --------------------------------------------------------------------------------
RULE 12b-1 DISTRIBUTION PLAN AND AGREEMENT dated as of July 12, 1996 by and
between LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC., a
Maryland corporation (the "Fund"), and LORD ABBETT DISTRIBUTOR LLC, a New York
limited liability company(the "Distributor").
WHEREAS, the Fund is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "Act"); and the
Distributor is the exclusive selling agent of the Fund's Class A shares of
capital stock (the "Shares") pursuant to the Distribution Agreement between the
Fund and the Distributor, dated as of the date hereof (the "Distribution
Agreement").
WHEREAS, the Fund desires to adopt a Distribution Plan and Agreement (the
"Plan") with the Distributor, as permitted by Rule 12b-1 under the Act, pursuant
to which the Fund may make certain payments to the Distributor to be used by the
Distributor or paid to institutions and persons permitted by applicable law
and/or rules to receive such payments ("Authorized Institutions") in connection
with sales of Shares and/or servicing of accounts of shareholders holding
Shares.
WHEREAS, the Plan will succeed a Rule 12b-1 Distribution Plan and Agreement
between the Fund and Lord, Abbett & Co. ("Lord Abbett"), an affiliate of the
Distributor.
WHEREAS, the Fund's Board of Directors has determined that there is a
reasonable likelihood that the Plan will benefit the Fund and the holders of the
Shares.
NOW, THEREFORE, in consideration of the mutual covenants and of other good
and valuable consideration, receipt of which is hereby acknowledged, it is
agreed as follows:
1. The Fund hereby authorizes the Distributor to enter into agreements
with Authorized Institutions (the "Agreements") which may provide for the
payment to such Authorized Institutions of distribution and service fees which
the Distributor receives from the Fund in order to provide additional incentives
to such Authorized Institutions (i) to sell Shares and (ii) to provide
- --
continuing information and
<PAGE>
investment services to their accounts holding Shares and otherwise to
encourage their accounts to remain invested in the Shares.
2. The Fund also hereby authorizes the Distributor to use payments
received hereunder from the Fund in order to (a) finance any activity which is
-
primarily intended to result in the sale of Shares and (b) provide continuing
-
information and investment services to shareholder accounts not serviced by
Authorized Institutions receiving a service fee from the Distributor hereunder
and otherwise to encourage such accounts to remain invested in the Shares;
provided that (i) any payments referred to in the foregoing clause (a) shall not
- -------- -
exceed the distribution fee permitted to be paid at the time under paragraph 3
of this Plan and shall be authorized by the Board of Directors of the Fund by a
vote of the kind referred to in paragraph 10 of this Plan and (ii) any payments
--
referred to in clause (b) shall not exceed the service fee permitted to be paid
at the time under paragraph 3 of this Plan.
3. The Fund is authorized to pay the Distributor hereunder for remittance
to Authorized Institutions and/or use by the Distributor pursuant to this Plan
(a) service fees at an annual rate not to exceed .15 of 1% of the average annual
- --
net asset value of Shares outstanding. The Board of Directors of the Fund shall
from time to time determine the amounts, within the foregoing maximum amounts,
that the Fund may pay the Distributor hereunder. Any such fees (which may be
waived by the Authorized Institutions in whole or in part) may be calculated and
paid quarterly or more frequently if approved by the Board of Directors of the
Fund. Such determinations and approvals by the Board of Directors shall be made
and given by votes of the kind referred to in paragraph 10 of this Plan.
4. The net asset value of the Shares shall be determined as provided in
the Articles of Incorporation of the Fund. If the Distributor waives all or a
portion of the fees which are to be paid by the Fund hereunder, the Distributor
shall not be deemed to have waived its rights under this Agreement to have the
Fund pay such fees in the future.
5. The Secretary of the Fund, or in his absence the Chief Financial
Officer, is hereby authorized to direct the disposition of monies paid or
payable by the Fund hereunder and shall provide to the Fund's Board of
Directors, and the Board of Directors shall review, at least quarterly, a
written report of the amounts so expended pursuant to this Plan and the purposes
for which such expenditures were made.
2
<PAGE>
6. Neither this Plan nor any other transaction between the parties hereto
pursuant to this Plan shall be invalidated or in any way affected by the fact
that any or all of the directors, officers, shareholders, or other
representatives of the Fund are or may be "interested persons" of the
Distributor, or any successor or assignee thereof, or that any or all of the
directors, officers, partners, or other representatives of the Distributor are
or may be "interested persons" of the Fund, except as may otherwise be provided
in the Act.
7. The Distributor shall give the Fund the benefit of the Distributor's
best judgment and good faith efforts in rendering services under this Plan.
Other than to abide by the provisions hereof and render the services called for
hereunder in good faith, the Distributor assumes no responsibility under this
Plan and, having so acted, the Distributor shall not be held liable or held
accountable for any mistake of law or fact, or for any loss or damage arising or
resulting therefrom suffered by the Fund or any of the shareholders, creditors,
directors, or officers of the Fund; provided however, that nothing herein shall
be deemed to protect the Distributor against any liability to the Fund or its
shareholders by reason of willful misfeasance, bad faith or gross negligence in
the performance of its duties hereunder, or by reason of the reckless disregard
of its obligations and duties hereunder.
8. This Plan shall become effective upon the date hereof, and shall
continue in effect for a period of more than one year from that date only so
long as such continuance is specifically approved at least annually by a vote of
the Board of Directors of the Fund, including the vote of a majority of the
directors who are not "interested persons" of the Fund and who have no direct or
indirect financial interest in the operation of this Plan or in any agreement
related to this Plan, cast in person at a meeting called for the purpose of
voting on such renewal.
9. This Plan may not be amended to increase materially the amount to be
spent by the Fund hereunder above the maximum amounts referred to in paragraph 3
of this Plan without a shareholder vote in compliance with Rule 12b-1 and Rule
18f-3 under the Act as in effect at such time, and each material amendment must
be approved by a vote of the Board of Directors of the Fund, including the vote
of a majority of the directors who are not "interested persons" of the Fund and
who have no direct or indirect financial interest in the operation of this Plan
or in any agreement related to this Plan, cast in person at a meeting called for
the purpose of voting on such amendment. Amendments to this Plan which do not
increase materially the amount to be spent by the Fund hereunder above the
maximum amounts referred to in para graph 3 of this Plan may be made pursuant to
paragraph 10 of this Plan.
3
<PAGE>
10. Amendments to this Plan other than material amendments of the kind
referred to in the foregoing paragraph 9 may be adopted by a vote of the Board
of Directors of the Fund, including the vote of a majority of the directors who
are not "interested persons" of the Fund and who have no direct or indirect
financial interest in the operation of this Plan or in any agreement related to
this Plan. The Board of Directors of the Fund may, by such a vote, interpret
this Plan and make all determina tions necessary or advisable for its
administration.
11. This Plan may be terminated at any time without the payment of any
penalty (a) by the vote of a majority of the directors of the Fund who are not
-
"interested persons" of the Fund and have no direct or indirect financial
interest in the operation of this Plan or in any agreement related to the Plan,
or (b) by a shareholder vote in compliance with Rule 12b-1 and Rule 18f-3 under
-
the Act as in effect at such time. This Plan shall automatically terminate in
the event of its assignment.
12. So long as this Plan shall remain in effect, the selection and
nomination of those directors of the Fund who are not "interested persons" of
the Fund are committed to the discretion of such disinterested directors. The
terms "interested persons," "assignment" and "vote of a majority of the
outstanding voting securities" shall have the same meanings as those terms are
defined in the Act.
IN WITNESS WHEREOF, each of the parties has caused this in strument to be
executed in its name and on its behalf by its duly authorized representative as
of the date first above written.
LORD ABBETT U.S. GOVERNMENT
SECURITIES MONEY MARKET
FUND, INC.
By: ____________________________
President
ATTEST:
- ------------------------------
Assistant Secretary
LORD ABBETT DISTRIBUTOR LLC
By: _____________________________
4
<PAGE>
EXHIBIT B-2
Rule 12b-1 Distribution Plan and Agreement
Lord Abbett U.S. Government Securities Money Market Fund, Inc. -- Class C Shares
- --------------------------------------------------------------------------------
RULE 12b-1 DISTRIBUTION PLAN AND AGREEMENT dated as of July 12, 1996 by and
between LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC., a
Maryland corporation (the "Fund"), and LORD ABBETT DISTRIBUTOR LLC, a New York
limited liability company (the "Distributor").
WHEREAS, the Fund is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "Act"); and the
Distributor is the exclusive selling agent of the Fund's Class C shares of
capital stock (the "Shares") pursuant to the Distribution Agreement between the
Fund and the Distributor, dated as of the date hereof (the "Distribution
Agreement").
WHEREAS, the Fund desires to adopt a Distribution Plan and Agreement (the
"Plan") with the Distributor, as permitted by Rule 12b-1 under the Act, pursuant
to which the Fund may make certain payments to the Distributor to be used by the
Distributor or paid to institutions and persons permitted by applicable law
and/or rules to receive such payments ("Authorized Institutions") in connection
with sales of Shares and/or servicing of accounts of shareholders holding
Shares.
WHEREAS, the Plan will succeed a Rule 12b-1 Distribution Plan and Agreement
between the Fund and Lord, Abbett & Co. ("Lord Abbett"), an affiliate of the
Distributor.
WHEREAS, the Fund's Board of Directors has determined that there is a
reasonable likelihood that the Plan will benefit the Fund and the holders of the
Shares.
NOW, THEREFORE, in consideration of the mutual covenants and of other good
and valuable consideration, receipt of which is hereby acknowledged, it is
agreed as follows:
1. The Fund hereby authorizes the Distributor to enter into agreements
with Authorized Institutions (the "Agreements") which may provide for the
payment to such Authorized Institutions of distribution and service fees which
the Distributor receives from the Fund in order to provide additional incentives
to such Authorized Institutions (i) to sell Shares and (ii) to provide
- --
continuing information and
<PAGE>
investment services to their accounts holding Shares and otherwise to
encourage their accounts to remain invested in the Shares.
2. The Fund also hereby authorizes the Distributor to use payments
received hereunder from the Fund in order to (a) finance any activity which is
-
primarily intended to result in the sale of Shares and (b) provide continuing
-
information and investment services to shareholder accounts not serviced by
Authorized Institutions receiving a service fee from the Distributor hereunder
and otherwise to encourage such accounts to remain invested in the Shares;
provided that (i) any payments referred to in the foregoing clause (a) shall not
- -------- -
exceed the distribution fee permitted to be paid at the time under paragraph 3
of this Plan and shall be authorized by the Board of Directors of the Fund by a
vote of the kind referred to in paragraph 10 of this Plan and (ii) any payments
--
referred to in clause (b) shall not exceed the service fee permitted to be paid
at the time under paragraph 3 of this Plan.
3. The Fund is authorized to pay the Distributor hereunder for remittance
to Authorized Institutions and/or use by the Distributor pursuant to this Plan
(a) service fees at an annual rate not to exceed .25 of 1% of the average annual
- --
net asset value of Shares outstanding. The Board of Directors of the Fund shall
from time to time determine the amounts, within the foregoing maximum amounts,
that the Fund may pay the Distributor hereunder. Any such fees (which may be
waived by the Authorized Institutions in whole or in part) may be calculated and
paid quarterly or more frequently if approved by the Board of Directors of the
Fund. Such determinations and approvals by the Board of Directors shall be made
and given by votes of the kind referred to in paragraph 10 of this Plan.
4. The net asset value of the Shares shall be determined as provided in
the Articles of Incorporation of the Fund. If the Distributor waives all or a
portion of the fees which are to be paid by the Fund hereunder, the Distributor
shall not be deemed to have waived its rights under this Agreement to have the
Fund pay such fees in the future.
5. The Secretary of the Fund, or in his absence the Chief Financial
Officer, is hereby authorized to direct the disposition of monies paid or
payable by the Fund hereunder and shall provide to the Fund's Board of
Directors, and the Board of Directors shall review, at least quarterly, a
written report of the amounts so expended pursuant to this Plan and the purposes
for which such expenditures were made.
2
<PAGE>
6. Neither this Plan nor any other transaction between the parties hereto
pursuant to this Plan shall be invalidated or in any way affected by the fact
that any or all of the directors, officers, shareholders, or other
representatives of the Fund are or may be "interested persons" of the
Distributor, or any successor or assignee thereof, or that any or all of the
directors, officers, partners, or other representatives of the Distributor are
or may be "interested persons" of the Fund, except as may otherwise be provided
in the Act.
7. The Distributor shall give the Fund the benefit of the Distributor's
best judgment and good faith efforts in rendering services under this Plan.
Other than to abide by the provisions hereof and render the services called for
hereunder in good faith, the Distributor assumes no responsibility under this
Plan and, having so acted, the Distributor shall not be held liable or held
accountable for any mistake of law or fact, or for any loss or damage arising or
resulting therefrom suffered by the Fund or any of the shareholders, creditors,
directors, or officers of the Fund; provided however, that nothing herein shall
be deemed to protect the Distributor against any liability to the Fund or its
shareholders by reason of willful misfeasance, bad faith or gross negligence in
the performance of its duties hereunder, or by reason of the reckless disregard
of its obligations and duties hereunder.
8. This Plan shall become effective upon the date hereof, and shall
continue in effect for a period of more than one year from that date only so
long as such continuance is specifically approved at least annually by a vote of
the Board of Directors of the Fund, including the vote of a majority of the
directors who are not "interested persons" of the Fund and who have no direct or
indirect financial interest in the operation of this Plan or in any agreement
related to this Plan, cast in person at a meeting called for the purpose of
voting on such renewal.
9. This Plan may not be amended to increase materially the amount to be
spent by the Fund hereunder above the maximum amounts referred to in paragraph 3
of this Plan without a shareholder vote in compliance with Rule 12b-1 and Rule
18f-3 under the Act as in effect at such time, and each material amendment must
be approved by a vote of the Board of Directors of the Fund, including the vote
of a majority of the directors who are not "interested persons" of the Fund and
who have no direct or indirect financial interest in the operation of this Plan
or in any agreement related to this Plan, cast in person at a meeting called for
the purpose of voting on such amendment. Amendments to this Plan which do not
increase materially the amount to be spent by the Fund hereunder above the
maximum amounts referred to in paragraph 3 of this Plan may be made pursuant to
paragraph 10 of this Plan.
3
<PAGE>
10. Amendments to this Plan other than material amendments of the kind
referred to in the foregoing paragraph 9 may be adopted by a vote of the Board
of Directors of the Fund, including the vote of a majority of the directors who
are not "interested persons" of the Fund and who have no direct or indirect
financial interest in the operation of this Plan or in any agreement related to
this Plan. The Board of Directors of the Fund may, by such a vote, interpret
this Plan and make all determinations necessary or advisable for its
administration.
11. This Plan may be terminated at any time without the payment of any
penalty (a) by the vote of a majority of the directors of the Fund who are not
-
"interested persons" of the Fund and have no direct or indirect financial
interest in the operation of this Plan or in any agreement related to the Plan,
or (b) by a shareholder vote in compliance with Rule 12b-1 and Rule 18f-3 under
-
the Act as in effect at such time. This Plan shall automatically terminate in
the event of its assignment.
12. So long as this Plan shall remain in effect, the selection and
nomination of those directors of the Fund who are not "interested persons" of
the Fund are committed to the discretion of such disinterested directors. The
terms "interested persons," "assignment" and "vote of a majority of the
outstanding voting securities" shall have the same meanings as those terms are
defined in the Act.
IN WITNESS WHEREOF, each of the parties has caused this in strument to be
executed in its name and on its behalf by its duly authorized representative as
of the date first above written.
LORD ABBETT U.S. GOVERNMENT
SECURITIES MONEY MARKET
FUND, INC.
By: _____________________________
President
ATTEST:
- -------------------------
Assistant Secretary
LORD ABBETT DISTRIBUTOR LLC
By:_____________________________
4
<PAGE>
EXHIBIT C
PROPOSED AMENDMENT TO ARTICLES OF INCORPORATION OF THE FUND AUTHORIZING THE
BOARD OF DIRECTORS TO CREATE NEW CLASSES AND SERIES OF SHARES OF THE CAPITAL
STOCK OF THE FUND AND CONFIRMING THAT THE FUND MAY IMPOSE CONTINGENT
DEFERRED SALES CHARGES IN CONNECTION WITH ITS RULE 12b-1 PLANS
--------------------------------------------------------------
The following text shows those provisions of the Articles of Incorporation of
the Fund that are to be amended; the text that is lined through shows deletions
and the text that is double underlined indicates additions.
ARTICLE V
SECTION 1. The total number of shares which the Corporation has authority
to issue is 1,000,000,000 shares of capital stock of the par value of $.001
each, having an aggregate par value of $1,000,000 initially classified into one
series, of which 960,000,000 shares of capital stock are initially classified as
Class A shares and 40,000,000 shares of capital stock are initially classified
as Class C shares. The Board of Directors of the Corporation shall have full
power and authority, from time to time, to classify or reclassify any unissued
shares of stock of the Corporation, including, without limitation, the power to
classify or reclassify unissued shares into series, and to classify or
reclassify a series into one or more classes of stock that may be invested
together in the common investment portfolio in which the series is invested, by
setting or changing the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption of such shares of stock. All shares of stock of a
series shall represent the same interest in the Corporation and have the same
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption as the other shares of stock of that series, except to the extent
that the Board of Directors provides for differing preferences, conversion or
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, or terms or conditions of redemption of shares of stock of
classes of such series as determined pursuant to Articles Supplementary filed
for record with the State Department of Assessments and Taxation of Maryland, or
as otherwise determined pursuant to these Articles or by the Board of Directors
in accordance with law. Notwithstanding any other provision of these Articles,
upon the first classification of unissued shares of stock into additional
series, the Board of Directors shall specify a legal name for the outstanding
series, as well as for the new series, in appropriate charter documents filed
for record with the State Department of Assessments and Taxation of Maryland
providing for such name change and classification, and upon any further
classification of the shares into additional classes,
<PAGE>
the Board of Directors shall specify a legal name for the new class or classes
in appropriate charter documents filed for record with the State Department of
Assessments and Taxation of Maryland providing for such name change and
classification.
SECTION 2. A description of the relative preferences, conversion and other
rights, voting powers, restrictions, limitations as to dividends, qualifications
and terms and conditions of redemption of all series and classes of series of
shares is as follows, unless otherwise set forth in Articles Supplementary filed
for record with the State Department of Assessments and Taxation of Maryland or
otherwise determined pursuant to these Articles:
(a) Assets Belonging to Series. All consideration received or
receivable by the Corporation for the issuance or sale of shares
of a particular series, together with all assets in which such
consideration is invested or reinvested, all income, earnings,
profits and proceeds thereof, including any proceeds derived from
the sale, exchange or liquidation of such assets, and any funds or
payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to that
series for all purposes, subject only to the rights of creditors,
and shall be so recorded upon the books of account of the
Corporation. Such consideration, assets, income, earnings, profits
and proceeds, including any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or payments
derived from any reinvestment of such proceeds in whatever form
the same may be, together with any unallocated items (as
hereinafter defined) relating to that series as provided in the
following sentence, are herein referred to as "assets belonging
to" that series. In the event that there are any assets, income,
earnings, profits or proceeds thereof, funds or payments which are
not readily identifiable as belonging to any particular series
(collectively "Unallocated Items"), the Board of Directors shall
allocate such Unallocated Items to and among any one or more of
the series created from time to time in such manner and on such
basis as it, in its sole discretion, deems fair and equitable; and
any Unallocated Items so allocated to a particular series
2
<PAGE>
shall belong to that series. Each such allocation by the Board
of Directors shall be conclusive and binding upon the stockholders
of all series for all purposes.
(b) Liabilities Belonging to Series. The assets belonging to each
particular series shall be charged with the liabilities of the
Corporation in respect of that series, including any class
thereof, and with all expenses, costs, charges and reserves
attributable to that series, including any such class, and shall
be so recorded upon the books of account of the Corporation. Such
liabilities, expenses, costs, charges and reserves, together with
any unallocated items (as hereinafter defined) relating to that
series, including any class thereof, as provided in the following
sentence, so charged to that series, are herein referred to as
"liabilities belonging to" that series. In the event there are any
unallocated liabilities, expenses, costs, charges or reserves of
the Corporation which are not readily identifiable as belonging to
any particular series (collectively "Unallocated Items"), the
Board of Directors shall allocate and charge such Unallocated
Items to and among any one or more of the series created from time
to time in such manner and on such basis as the Board of Directors
in its sole discretion deems fair and equitable; and any
Unallocated Items so allocated and charged to a particular series
shall belong to that series. Each such allocation by the Board of
Directors shall be conclusive and binding upon the stockholders of
all series for all purposes. To the extent determined by the Board
of Directors, liabilities and expenses relating solely to a
particular class (including, without limitation, distribution
expenses under a Rule 12b-1 plan and administrative expenses under
an administration or service agreement, plan or other arrangement,
however designated, which may be adopted for such class) shall be
allocated to and borne by such class and shall be appropriately
reflected (in the manner determined by the Board of Directors) in
the net asset value, dividends and distributions and liquidation
rights of the shares of such class.
3
<PAGE>
(c) Dividends. Dividends and distributions on shares of a particular
series may be paid to the holders of shares of that series at such
times, in such manner and from such of the income and capital
gains, accrued or realized, from the assets belonging to that
series, after providing for actual and accrued liabilities
belonging to that series, as the Board of Directors may determine.
Such dividends and distributions may vary between or among classes
of a series to reflect differing allocations of liabilities and
expenses of such series between or among such classes to such
extent as may be provided in or determined pursuant to Articles
Supplementary filed for record with the State Department of
Assessments and Taxation of Maryland or as may otherwise be
determined by the Board of Directors.
(d) Liquidation. In the event of the liquidation or dissolution of the
Corporation, the stockholders of each series shall be entitled to
receive, as a series, when and as declared by the Board of
Directors, the excess of the assets belonging to that series over
the liabilities belonging to that series. The assets so
distributable to the stockholders of one or more classes of a
series shall be distributed among such stockholders in proportion
to the respective aggregate net asset values of the shares of such
series held by them and recorded on the books of the Corporation.
(e) Voting. On each matter submitted to vote of the stock holders,
each holder of a share shall be entitled to one vote for each such
share standing in his name on the books of the Corporation
irrespective of the series or class thereof and all shares of all
series and classes shall vote as a single class ("Single Class
Voting"); provided, however, that (i) as to any matter with
respect to which a separate vote of any series or class is
required by the Investment Company Act of 1940, as amended from
time to time, applicable rules and regulations thereunder, or the
Maryland General Corporation Law, such requirement as to a
separate vote of that series or class shall apply in lieu of
Single Class Voting as described
4
<PAGE>
above; (ii) in the event that the separate vote requirements
referred to in (i) above apply with respect to one or more (but
less than all) series or classes, then, subject to (iii) below,
the shares of all other series and classes shall vote as a single
class; and (iii) as to any matter which does not affect the
interest of a particular series or class, only the holders of
shares of the one or more affected series or classes shall be
entitled to vote.
(f) Conversion. At such times (which times may vary among shares of a
class) as may be determined by the Board of Directors, shares of a
particular class of a series may be automatically converted into
shares of another class of such series based on the relative net
asset values of such classes at the time of conversion, subject,
however, to any conditions of conversion that may be imposed by
the Board of Directors.
SECTION 3. Each share of the capital stock of the Corporation shall be
subject to the following provisions:
(a) All shares of the capital stock of the Corporation now or
hereafter authorized shall be subject to redemption and redeemable
at the option of the stockholder, in the sense used in the General
Laws of the State of Maryland authorizing the formation of
corporations. Each holder of the shares of capital stock of the
Corporation, upon request to the Corporation accompanied by
surrender (to the Corporation, or an agent designated by it) of
the appropriate stock certificate or certificates, if any, in
proper form for transfer, and such other instruments as the Board
of Directors may require, shall be entitled to require the
Corporation to redeem all or any part of the shares of capital
stock outstanding in the name of such holder on the books of the
Corporation, at a redemption price equal to the net asset value of
such shares determined as hereinafter set forth. Notwithstanding
the foregoing, the Corporation may deduct from the proceeds
otherwise due to any stockholder requiring the Corporation to
redeem shares a redemption charge not to exceed one percent (1%)
of
5
<PAGE>
such net asset value, or a reimbursement charge, a deferred sales
charge or other charge that is integral to the Corporation's
distribution program (which charges may vary within and among
series and classes) as may be established from time to time by the
Board of Directors.
SECTION 4. Notwithstanding any provision of law requiring any action to
be taken or authorized by the affirmative vote of the holders of a designated
proportion greater than a majority of the shares or votes entitled to be cast,
such action shall be effective and valid if taken or authorized by the
affirmative vote of the holders of a majority of the total number of shares
outstanding and entitled to vote thereon pursuant to the provisions of these
Articles of Incorporation.
SECTION 5. No holder of stock of the Corporation shall, as such holder,
have any right to purchase or subscribe for any shares of the capital stock of
the Corporation which it may issue or sell (whether out of the number of shares
now or hereafter authorized by these Articles of Incorporation, or any amendment
thereof, or out of any shares of the capital stock of the Corporation acquired
by it after the issue thereof, or otherwise) other than such right, if any, as
the Board of Directors, in its discretion, may determine.
ARTICLE VII
* * *
SECTION 1. In furtherance and not in limitation of the powers conferred by
statute and pursuant to these Articles of Incorporation, the Board of Directors
is expressly authorized to do the following:
* * *
(g) To authorize any agreement of the character described in
subsection (e) or (f) of this Section 1 with any person,
corporation, association, partnership or other
organization, although one or more of the members of the
Board of Directors or officers of the Corporation may be
the other party to any such agreement or an officer,
director, shareholder, or member of such other party, and
no such agreement shall be invalidated or rendered
voidable by reason of
6
<PAGE>
the existence of any such relationship. Any director of
the Corporation who is also a director, officer,
shareholder, or member of such other party may be counted
in determining the existence of a quorum at any meeting of
the Board of Directors which shall authorize any such
agreement, and may vote thereat to authorize any such
contract or transaction, with like force and effect as if
he were not such director, officer, shareholder, or member
of such other party. Any agreement entered into pursuant
to said subsections (e) or (f), shall be consistent with
and subject to the requirements of the Investment Company
Act of 1940, as amended from time to time, applicable
rules and regulations thereunder, or any other applicable
Act of Congress hereafter enacted), and no amendment to
any agreement entered into pursuant to said subsection (e)
(other than an amendment reducing the compensation of the
other party thereto) shall be effective unless assented to
by the affirmative vote of a majority of the outstanding
voting securities of the Corporation, (as such phrase is
defined in the Investment Company Act of 1940, as amended
from time to time) entitled to vote on the matter.
* * *
SECTION 3. For the purposes referred to in these Articles of
Incorporation, the net asset value of shares of the capital stock of the
Corporation of each series and class as of any particular time (a "determination
time") shall be determined by or pursuant to the direction of the Board of
Directors as follows:
(a) At times when a series is not classified into multiple
classes, the net asset value of each share of stock of a
series, as of a determination time, shall be the quotient,
carried out to not less than two decimal points, obtained
by dividing the net value of the assets of the Corporation
belonging to that series (determined as hereinafter
provided) as of such determination time by the total
number of shares of that series then outstanding,
7
<PAGE>
including all shares of that series which the Corporation
has agreed to sell for which the price has been
determined, and excluding shares of that series which the
Corporation has agreed to purchase, or which are subject
to redemption for which the price has been determined.
The net value of the assets of the Corporation of a series
as of a determination time shall be determined in
accordance with sound accounting practice by deducting
from the gross value of the assets of the Corporation
belonging to that series (determined as hereinafter
provided), the amount of all liabilities, belonging to
that series (as such terms are defined in subsection (b)
of Section 2 of Article V), in each case as of such
determination time.
The gross value of the assets of the Corporation belonging
to a series as of such determination time shall be an
amount equal to all cash, receivables, the market value of
all securities for which market quotations are readily
available and the fair value of other assets of the
Corporation belonging to that series (as such terms are
defined in subsection (a) of Section 2 of Article V) at
such determination time, all determined in accordance with
sound accounting practice and giving effect to the
following:
* * *
(b) At times when a series is classified into multiple
classes, the net asset value of each share of stock of a
class of such series shall be determined in accordance
with subsections (a) and (c) of this Section 3 with
appropriate adjustments to reflect differing allocations
of liabilities
8
<PAGE>
and expenses of such series between or among such classes
to such extent as may be provided in or determined
pursuant to Articles Supplementary filed for record with
the State Department of Assessments and Taxation of
Maryland or as may otherwise be determined by the Board of
Directors.
(c) The Board of Directors is empowered, in its discretion, to
establish other methods for determining such net asset
value whenever such other methods are deemed by it to be
necessary or desirable, including, but without limiting
the generality of the foregoing, any method deemed
necessary or desirable in order to enable the Corporation
to comply with any provision of the Investment Company Act
of 1940 or any rule or regulation thereunder.
SECTION 4. Any determination as to any of the following matters made by or
pursuant to the direction of the Board of Directors consistent with these
Articles of Incorporation and in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of duties, shall be final and conclusive
and shall be binding upon the Corporation and every holder of shares of its
capital stock of the Corporation, of any series or class, namely, the amount of
the assets, obligations, liabilities and expenses of the Corporation or
belonging to any series or with respect to any class; the amount of the net
income of the Corporation from dividends and interest for any period and the
amount of assets at any time legally available for the payment of dividends with
respect to any series or class; the amount of paid-in surplus, other surplus,
annual or other net profits, or net assets in excess of capital, undivided
profits, or excess of profits over losses on sales of securities belonging to
the Corporation or any series or class; the amount, purpose, time of creation,
increase or decrease, alteration or cancellation of any reserves or charges and
the propriety thereof (whether or not any obligation or liability for which such
reserves or charges shall have been created shall have been paid or discharged)
with respect to the Corporation or any series or class; the market value, or any
sale, bid or asked price to be applied in determining the market value, of any
security owned or held by the Corporation; the fair value of any other asset
owned by the Corporation; the number of shares of stock of any series or class
issued or issuable; the existence of conditions permitting the postponement of
payment of the repurchase price of shares of stock of any series or class or the
9
<PAGE>
suspension of the right of redemption as provided by law; any matter relating to
the acquisition, holding and disposition of securities and other assets by the
Corporation; any question as to whether any transaction constitutes a purchase
of securities on margin, a short sale of securities, or an underwriting of the
sale of, or participation in any underwriting or selling group in connection
with the public distribution of, any securities; and any matter relating to the
issue, sale, repurchase and/or other acquisition or disposition of shares of
stock of any series or class.
* * *
The Articles of Amendment which set forth the amended provisions above also
provide as follows:
Each share (including for this purpose a fraction of a share) of capital stock
issued and outstanding prior to these Articles of Amendment becoming effective
(other than shares that were issued in connection with an exchange of shares
held in Lord Abbett Securities Trust, a Delaware business trust (each such
share, a "Securities Trust Share" and collectively, the "Securities Trust
Shares")) shall, at the time these Articles of Amendment become effective, be
reclassified automatically, and without any action or choice on the part of the
holder, into a Class A share (or the same fraction of a Class A share) of the
initial series of capital stock. Each Securities Trust Share issued and
outstanding prior to these Articles of Amendment becoming effective shall, at
such effective time, be reclassified automatically, and without any action or
choice on the part of the holder, into a Class C share (or the same fraction of
a Class C share). Outstanding certificates representing issued and outstanding
shares of capital stock of the Corporation immediately prior to these Articles
of Amendment becoming effective shall, upon these Articles of Amendment becoming
effective, be deemed to represent the same number of Class A shares or Class C
shares, as the case may be, of the initial series of capital stock. If the
Corporation issues stock certificates upon the request of a stockholder,
certificates representing outstanding Class A shares and Class C shares of the
initial series of capital stock resulting from the aforesaid reclassification
need not be issued until certificates representing the shares of capital stock
of the Corporation so reclassified, if issued, have been received by the
Corporation or its agent duly endorsed for transfer. The Class A shares and
Class C shares of the initial series of capital stock shall have the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption as set forth in the charter of the Corporation, as herein amended, or
as determined by the Board of Directors pursuant thereto.
10
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
ANNUAL MEETING OF SHAREHOLDERS
JUNE 19, 1996
767 Fifth Avenue
New York, New York 10153
Shares to be designated Class A Shares
The undersigned hereby appoints KENNETH B. CUTLER, ROBERT S. DOW and RONALD P.
LYNCH and each of them proxies, with full power of substitution, to vote
(according to the number of votes which the undersigned would be entitled to
cast if then personally present) at the annual meeting of shareholders of LORD
ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC. (the "Fund") on June
19, 1996, including all adjournments, as specified below, and in their
discretion upon such other business as may properly be brought before the
meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS WHICH RECOMMENDS
THAT YOU VOTE FOR PROPOSALS 1-5.
UNLESS OTHERWISE SPECIFIED IN THE SQUARES PROVIDED, THE VOTE OF THE UNDERSIGNED
IS TO BE CAST FOR ALL PROPOSALS LISTED BELOW.
1. Election of Directors:
For [_] Without Authority [_] For All Except [_] (NOTE: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, CHECK THE "FOR ALL EXCEPT"
BOX AND STRIKE A LINE THROUGH THE NOMINEE'S NAME BELOW.)
Ronald P. Lynch, Robert S. Dow, E. Thayer Bigelow, Stewart S. Dixon, John C.
Jansing, C. Alan MacDonald, Hansel B. Millican, Jr. and Thomas J. Neff.
2. For [_] Against [_] Abstain [_] To ratify the selection of Deloitte &
Touche LLP as independent public accountants of the Fund for the fiscal year
ending June 30, 1996.
3. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
changes in the Fund's fundamental investment policies and restrictions, as
described in the proxy statement.
<PAGE>
4. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
new Class A Share Distribution Plan and Agreement pursuant to Rule 12b-1
under the Investment Company Act of 1940, as described in the proxy
statement.
5. For [_] Against [_] Abstain [_] To approve or disapprove an amendment
to the Fund's Articles of Incorporation (i) authorizing the Board of
-
Directors to create new classes and series of shares of capital stock; and
(ii) confirming that the board may impose contingent deferred sales charges
--
in connection with new classes of shares to be created, as described in
the proxy statement.
2
<PAGE>
ACCOUNT NUMBER SHARES PROXY NUMBER
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
PLEASE SIGN, DATE AND MAIL THIS PROXY IN
THE POSTAGE-PAID RETURN ENVELOPE PROVIDED.
For information as to the voting of stock
registered in more than one name, see page 1
of the proxy statement. When signing the proxy
as attorney, executor, administrator, trustee
or guardian, please indicate the capacity in
which you are acting. Only authorized officers
should sign for corporations.
Date:......................................
Signature(s) of Shareholder(s) as shown at left
...............................................
...............................................
(Please read other side)
3
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
ANNUAL MEETING OF SHAREHOLDERS
JUNE 19, 1996
767 Fifth Avenue
New York, New York 10153
Shares to be designated Class C Shares
The undersigned hereby appoints KENNETH B. CUTLER, ROBERT S. DOW and
RONALD P. LYNCH and each of them proxies, with full power of substitution, to
vote (according to the number of votes which the undersigned would be entitled
to cast if then personally present) at the annual meeting of shareholders of
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC. (the "Fund") on
June 19, 1996, including all adjournments, as specified below, and in their
discretion upon such other business as may properly be brought before the
meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS WHICH RECOMMENDS
THAT YOU VOTE FOR PROPOSALS 1-5.
UNLESS OTHERWISE SPECIFIED IN THE SQUARES PROVIDED, THE VOTE OF THE UNDERSIGNED
IS TO BE CAST FOR ALL PROPOSALS LISTED BELOW.
1. Election of Directors:
For [_] Without Authority [_] For All Except [_] (NOTE: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, CHECK THE "FOR ALL EXCEPT"
BOX AND STRIKE A LINE THROUGH THE NOMINEE'S NAME BELOW.)
Ronald P. Lynch, Robert S. Dow, E. Thayer Bigelow, Stewart S. Dixon, John C.
Jansing, C. Alan MacDonald, Hansel B. Millican, Jr. and Thomas J. Neff.
2. For [_] Against [_] Abstain [_] To ratify the selection of Deloitte &
Touche LLP as independent public accountants of the Fund for the fiscal year
ending June 30, 1996.
3. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
changes in the Fund's fundamental investment policies and restrictions, as
described in the proxy statement.
4
<PAGE>
4. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
new Class C Share Distribution Plan and Agreement pursuant to Rule 12b-1
under the Investment Company Act of 1940, as described in the proxy
statement.
5. For [_] Against [_] Abstain [_] To approve or disapprove an amendment
to the Fund's Articles of Incorporation (i) authorizing the Board of
-
Directors to create new classes and series of shares of capital stock; and
(ii) confirming that the board may impose contingent deferred sales charges
--
in connection with new classes of shares to be created, as described in
the proxy statement.
5
<PAGE>
ACCOUNT NUMBER SHARES PROXY NUMBER
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
PLEASE SIGN, DATE AND MAIL THIS PROXY IN
THE POSTAGE-PAID RETURN ENVELOPE PROVIDED.
For information as to the voting of stock
registered in more than one name, see page 1
of the proxy statement. When signing the proxy
as attorney, executor, administrator, trustee
or guardian, please indicate the capacity in
which you are acting. Only authorized officers
should sign for corporations.
Date:......................................
Signature(s) of Shareholder(s) as shown at left
...............................................
...............................................
(Please read other side)
6
