ENDOWMENTS, INC.
One Market, Steuart Tower
P.O. Box 7650
San Francisco, California 94120
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 20, 1997
To the Shareholders of Endowments, Inc.:
The Annual Meeting of Shareholders of Endowments, Inc. (the "fund") will
be held at the offices of the Corporation, One Market, Steuart Tower (Suite
1800), San Francisco, California, on Thursday, November 20, 1997, at 10:00
a.m., local time, to consider and vote on the following matters described under
the corresponding numbers in the accompanying Proxy Statement:
(1) election of a board of seven (7) directors;
(2) ratification of the selection by the Board of Directors of Deloitte &
Touche LLP as independent auditors for the fund for the fiscal year ending July
31, 1998; and
(3) such other matters as may properly come before the meeting.
The Board of Directors has fixed the close of business on October 2, 1997 as
the record date for the determination of shareholders entitled to receive
notice of and to vote at the annual meeting.
THE PROPOSED BUSINESS CANNOT BE CONDUCTED AT THE ANNUAL MEETING UNLESS THE
HOLDERS OF A MAJORITY OF THE SHARES OF THE FUND ARE PRESENT IN PERSON OR BY
PROXY. THEREFORE, PLEASE MARK, DATE, SIGN AND RETURN THE ENCLOSED PROXY, WHICH
IS SOLICITED BY THE BOARD OF DIRECTORS. THE PROXY IS REVOCABLE AND WILL NOT
AFFECT YOUR RIGHT TO VOTE IN PERSON IN THE EVENT YOU ATTEND THE MEETING.
By Order of the Board of Directors
Patrick F. Quan
Secretary
San Francisco, California
October 8, 1997
IT IS IMPORTANT THAT YOU MARK, DATE, SIGN, AND
PROMPTLY MAIL THE ENCLOSED PROXY.
PROXY STATEMENT
The enclosed Proxy is solicited by the Board of Directors of the fund in
connection with the Annual Meeting of Shareholders to be held on Thursday,
November 20, 1997. Every Proxy returned in time to be voted at the meeting
will be voted, and, if a specification is made with respect to any proposal,
the Proxy will be voted accordingly. Anyone giving a Proxy may revoke it prior
to its exercise, either by filing with the fund a written notice of revocation,
by delivering a duly executed Proxy bearing a later date, or by attending the
meeting and voting in person.
At the close of business on October 2, 1997, the record date fixed by the
Board of Directors for the determination of shareholders entitled to notice of
and to vote at the meeting, there were outstanding 2,075,098.647 common shares
of capital stock, $1 par value, the only authorized class of voting securities
of the fund. Each share is entitled to one vote. There is no provision for
cumulative voting. As of August 31, 1997 the shareholders who owned 5% or more
of the fund's outstanding stock were Boy Scouts of America - Mt.
Diablo/Silverado Council, 132,020 shares (6.27%); California Institute of the
Arts, 272,388 shares (12.93%); Citizens' Scholarship Foundation of America,
146,210 shares (6.94%); Foundation for Reproductive Research and Education,
114,622 shares (5.44%); and Loyola Marymount University, 115,087 shares
(5.46%).
This Proxy Statement was first mailed to shareholders on or about October
8, 1997. The fund's Annual Report for the fiscal year ended July 31, 1997
including financial statements has been mailed to each shareholder entitled to
vote at the meeting. The report is not to be regarded as proxy soliciting
material or as part of this Proxy Statement.
With respect to the election of directors (Item 1), the seven nominees
receiving the highest number of votes shall be deemed to be elected. A
plurality of all votes cast at the meeting is sufficient to approve Item 2.
In the event that sufficient votes are not received by the meeting date, a
person named as proxy may propose one or more adjournments of the meeting for a
period or periods of not more than 30 days in the aggregate to permit further
solicitation of Proxies. The persons named as proxies may vote all Proxies in
favor of such adjournment, but only if such persons also consider it reasonable
and in the interest of shareholders to adjourn such meeting. Signed but
unmarked Proxies will be voted for the below nominated Directors and in favor
of all proposals. Shareholder who return Proxies marked as abstaining from
voting on one or more proposals are treated as being present at the meeting for
purposes of obtaining the quorum necessary to hold the meeting, but are not
counted as part of the vote necessary to approve the proposal(s).
1. ELECTION OF DIRECTORS
Seven directors are to be elected at the meeting to hold office until the
next annual meeting of shareholders and until their successors are elected and
qualified. All of the nominees were elected by the shareholders at a meeting
held November 21, 1996. The directors were nominated for re-election at a
meeting of the Board held August 15, 1997. Each of the nominees has agreed to
serve as a director if re-elected. The Certificate of Incorporation provides
that each director, except for the Chairman of the Board or the President,
shall be a designated representative of at least one charitable institution
which is a shareholder of the fund or of Bond Portfolio for Endowments, Inc.
If, due to present unforeseen circumstances, any nominee should not be
available for election, the persons named as proxies will vote the signed but
unmarked Proxies and those marked for the nominated directors for such other
nominee as the present directors shall recommend. The table on the following
page sets forth certain information regarding the nominees.
<TABLE>
<CAPTION>
Name of Nominee Current Principal Year First Memberships on
(Position with Occupation and Elected a Boards of Other
Fund) Principal Employment Director Registered Investment
and Age During Past Five Years /1/ Companies and Publicly
Held Companies
<S> <C> <C> <C>
/2/Robert B. Senior Partner, The 1989 Bond Portfolio for Endowments
Egelston Capital Group The New Economy Fund
(Chairman of the Partners L.P.; former SMALLCAP World Fund
Board) Chairman of the Board,
66 The Capital Group
Companies, Inc.
/2/Frank L. Vice President, Capital 1992 Bond Portfolio for Endowments
Ellsworth(President Research and Management
and Director) Company; former President,
54 Independent Colleges of
Southern California.
Designated Representative:
Independent Colleges of
Southern California.
/3/ /4/ /5/Steven D. President, California 1994 Bond Portfolio for Endowments
Lavine Institute of the Arts.
(Director) Designated Representative:
50 California Institute of the
Arts.
/3/ /4/ /5/Patricia Chief Financial Officer, 1988 Bond Portfolio for Endowments
A. McBride Kevin L. McBride,
(Director) D.D.S., Inc.
54 Designated Representative:
Madison Foundation.
/3/ /4/ /5/Charles Chairman, Pfaffinger 1988 Bond Portfolio for Endowments
R. Redmond Foundation; former
(Director) President and Chief
71 Executive Officer,
Times Mirror Foundation.
Designated Representative:
Loyola Marymount
University.
/2/Thomas E. Terry Consultant. Former Vice 1994 American Variable Insurance
(Director) President and Secretary, Series
59 Capital Research and Bond Portfolio for Endowments
Management Company.
Designated Representative:
Citizens' Scholarship
Foundation of America.
/3/ /4/ /5/Robert C. Management Consultant, 1993 Bond Portfolio for Endowments
Ziebarth Ziebarth Company.
(Director) Designated Representative:
61 Foundation for Reproductive
Research & Education.
</TABLE>
______________________
/1/ Corporate positions, in some instances, may have changed during the period.
/2/ Is considered an "interested person" of the fund within the meaning of the
Investment Company Act of 1940 (the "1940 Act"), on the basis of his
affiliation with Capital Research and Management Company (the "Investment
Adviser").
/3/ The fund has an Audit Committee comprised of the above-designated
directors. The function of the Committee includes such specific matters as
recommending the independent accountant to the Board of Directors, reviewing
the audit plan and results of audits and considering matters deemed appropriate
by the Board of Directors and/or the Committee.
/4/ The fund has a Nominating Committee comprised of the above-designated
directors. The Committee's functions include selecting and recommending to the
full Board of Directors nominees for election as Directors of the fund. While
the Committee is normally able to identify from its own resources an ample
number of qualified candidates, it will consider shareholder suggestions of
persons to be considered as nominees to fill future vacancies on the Board.
Such suggestions must be sent in writing to the Committee of the fund, c/o the
fund's Secretary, and must be accompanied by complete biographical and
occupational data on the prospective nominee, along with the written consent of
the prospective nominee to consideration of his or her name by the Committee.
Suggestions must be received by the fund's Secretary before the end of the
fund's fiscal year to be eligible for consideration for nomination at or before
the next annual meeting of shareholders.
/5/ The fund has a Contracts Committee comprised of the above-designated
directors who are not considered to be "interested persons" of the fund within
the meaning of the 1940 Act. The Committee's function is to request, review
and consider the information deemed necessary to evaluate the terms of the
investment advisory agreement that the fund proposes to enter into, renew or
continue prior to voting thereon, and to make its recommendations to the full
Board of Directors on these matters.
Shares of the fund may be purchased only by institutional investors exempt from
taxation under Section 501(c)(3) of the Internal Revenue Code. Therefore, none
of the directors owns any shares of the fund. Furthermore, the fund pays no
salaries or other compensation to its directors. No other director receives
any compensation from funds managed by Capital Research and Management Company.
There were four Board of Directors, two Audit Committee, no Nominating
Committee, and one Contracts Committee meetings during the fiscal year 1997.
Each of the nominees, except Mr. Lavine, attended at least 75% of all meetings
of the Board and of the committees of which he or she was a member.
OTHER EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
Name Principal Occupation Officer
(Position with Fund) for Last Five Years/1/ Continuously
and Age Since/2/
<S> <C> <C>
Abner D. Goldstine Senior Vice President and 1995
(Senior Vice President) Director, Capital Research and
67 Management Company.
Robert G. O'Donnell Senior Vice President and 1995
(Senior Vice President) Director, Capital Research and
53 Management Company.
Claudia P. Huntington Vice President, Capital Research 1996
(Vice President) and Management Company.
45
Mary C. Hall Senior Vice President, Fund 1986
(Treasurer) Business Management Group, Capital
39 Research and Management Company.
Patrick F. Quan Vice President - Fund 1986
(Secretary) Business Management Group,
39 Capital Research and Management
Company.
</TABLE>
__________________
/1/The occupation shown reflects the principal employment of each individual
during the past five years. Corporate positions, in some instances, may have
changed during the period.
/2/Officers are elected to hold office until their respective successors are
elected, or until they resign or are removed.
No officers, directors, or employees of Capital Research and Management
Company, its parent, or its subsidiaries received any remuneration directly
from the fund.
2. RATIFICATION OF THE SELECTION BY THE BOARD OF DIRECTORS OF DELOITTE &
TOUCHE LLP AS INDEPENDENT AUDITORS FOR THE FISCAL YEAR 1998
Shareholders are requested to ratify the selection by the Board of
Directors (including a majority of directors who are not "interested persons"
of the fund as that term is defined in the 1940 Act) of the firm of Deloitte &
Touche LLP as independent auditors for the fund for the fiscal year 1998. In
addition to the normal audit services, Deloitte & Touche LLP will provide
services in connection with the preparation and review of federal and state tax
returns for the fund. Deloitte & Touche LLP has served as the fund's
independent auditors since February 13, 1991 and has advised the fund that it
has no material direct or indirect financial interest in the fund or its
affiliates. No representative of the firm of Deloitte & Touche LLP is expected
to be available to answer questions or attend the meeting of shareholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR RATIFICATION OF THEIR
SELECTION OF DELOITTE & TOUCHE LLP.
OTHER MATTERS
Neither the persons named in the enclosed Proxy nor the Board of Directors
are aware of any matters that will be presented for action at the meeting other
than matters set forth herein. Should any other matters properly requiring a
vote of shareholders arise, the Proxy in the accompanying form will confer upon
the person or persons entitled to vote the shares represented by such Proxy
discretionary authority to vote the shares in respect of any such matters in
accordance with their best judgment in the interest of the fund and its
shareholders.
SHAREHOLDER PROPOSALS
Notice is hereby given that any shareholder proposals for inclusion in the
proxy solicitation materials for the next annual meeting, presently scheduled
for November 19, 1998, must be received by the fund at its principal executive
offices, One Market, Steuart Tower, Suite 1800, San Francisco, CA 94105, not
less than 120 days in advance of the first anniversary of the date of this
Proxy Statement. Any such proposals must comply with the requirements of Rule
14a-8 promulgated under the Securities Exchange Act of 1934.
GENERAL INFORMATION
Capital Research and Management Company is the investment adviser to the
fund and is located at 333 South Hope Street, Los Angeles, CA 90071 and 135
South State College Boulevard, Brea, CA 92821.
The cost of solicitation of the enclosed Proxies will be borne by the
fund. If necessary to ensure satisfactory representation at the meeting, the
officers of the fund may solicit proxies to a limited extent by telephone or
fax. Any such additional solicitation would be undertaken without cost to the
fund, except actual out-of-pocket communication charges which are estimated not
to exceed $1,000. ALL SHAREHOLDERS ARE URGED TO MARK, DATE, SIGN AND RETURN
THE PROXY CARD IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN
THE UNITED STATES.
A COPY OF THE FUND'S MOST RECENT ANNUAL REPORT MAY BE OBTAINED, WITHOUT
CHARGE, BY WRITING TO THE SECRETARY OF THE FUND AT ONE MARKET, STEUART TOWER,
SUITE 1800, SAN FRANCISCO, CA 94105, OR BY TELEPHONING 415/421-9360. THESE
REQUESTS WILL BE HONORED WITHIN THREE BUSINESS DAYS OF RECEIPT.
By Order of the Board of Directors
Patrick F. Quan
Secretary
October 8, 1997
PROXY
ENDOWMENTS, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
FUND FOR THE ANNUAL MEETING
OF SHAREHOLDERS TO BE HELD NOVEMBER 20, 1997
The undersigned hereby appoints Frank L. Ellsworth and Patrick F. Quan as
lawful agents and proxies, each with full power to appoint a substitute to
represent the undersigned at the aforesaid Annual Meeting of Shareholders to be
held at the offices of the Corporation, One Market, Steuart Tower (Suite 1800),
San Francisco, California, on Thursday, November 20, 1997, at 10:00 a.m., on
all matters coming before said meeting.
1. ELECTION OF DIRECTORS
Nominees: Robert B. Egelston, Frank L. Ellsworth, Steven D. Lavine,
Patricia A. McBride, Charles R. Redmond, Thomas E. Terry, and Robert C.
Ziebarth
[ ] VOTE FOR all nominees listed above, except vote withheld from the
following nominees (if any):
OR
[ ] VOTE WITHHELD from all nominees.
2. RATIFICATION OF SELECTION OF DELOITTE & TOUCHE LLP AS INDEPENDENT AUDITORS
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, upon other matters as may properly come before the
meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR THE NOMINEES LISTED IN ITEM 1 AND FOR ITEM 2.
- ------------, 1997 -----------------------------------------
(Date) (Please sign exactly as name appears below)
SHAREHOLDER:
SHARES HELD OCTOBER 2, 1997:
