<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(Amendment No. )
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-
6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Allmerica Investment Trust
(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):
[x] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6( i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] 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>
ALLMERICA INVESTMENT TRUST: SELECT CAPITAL APPRECIATION FUND
440 LINCOLN STREET
WORCESTER, MA 01653
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders:
A Special Meeting of Shareholders of the Select Capital Appreciation
Fund (the "Fund"), a series of Allmerica Investment Trust (the "Trust"), will be
held at the offices of the Trust at 440 Lincoln Street, Worcester, Massachusetts
01653 on June 3, 1998 at 10:00 a.m., local time, for the following purposes:
1. To approve or disapprove a new Sub-Adviser Agreement between
Allmerica Financial Investment Management Services, Inc. and
T. Rowe Price Associates, Inc. as described in the attached
Proxy Statement.
2. To transact such other business as may properly come before
the Meeting, or any adjournment thereof.
Shareholders of record as of the close of business on April 9, 1998 are
entitled to notice of, and to vote at, the Meeting or at any adjournment
thereof. Your attention is called to the accompanying Proxy Statement.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE URGED TO
COMPLETE, SIGN AND DATE AND RETURN PROMPTLY THE ENCLOSED PROXY CARD. If you do
attend the Meeting, you may revoke the Proxy and vote in person.
Worcester, MA
April 24, 1998
By order of the Trustees
George M. Boyd
Secretary
<PAGE>
ALLMERICA INVESTMENT TRUST: SELECT CAPITAL APPRECIATION FUND
440 LINCOLN STREET
WORCESTER, MASSACHUSETTS 01653
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
JUNE 3, 1998
The enclosed Proxy is solicited on behalf of the Trustees of Allmerica
Investment Trust, a Massachusetts business trust (the "Trust"), to be voted at a
Special Meeting (the "Meeting") of Shareholders of the Select Capital
Appreciation Fund, a separate series of the Trust (the "Fund"), to be held at
the offices of the Trust, 440 Lincoln Street, Worcester, MA 01653 at 10:00 a.m.,
local time, on June 3, 1998 for the purposes set forth in the accompanying
Notice. The mailing date of this Proxy Statement is on or about April 24, 1998.
A Shareholder may revoke the accompanying Proxy at any time prior to
its use by filing with the Secretary of the Trust a written revocation or duly
executed Proxy bearing a later date. The Proxy will not be voted if the
Shareholder is present at the Meeting and elects to vote in person. Attendance
at the Meeting alone will not serve to revoke the Proxy.
In addition to the solicitation of Proxies by mail, officers and
employees of the Trust, without additional compensation, may solicit Proxies in
person or by telephone. The costs associated with such solicitation and the
Meeting will be borne by the Fund.
The Trust will furnish, without charge, a copy of the most recent
Annual Report to the Shareholders of the Fund. Requests should be directed to
the Trust at 440 Lincoln Street, Worcester, Massachusetts 01653 or by calling
(800)533-7881.
The shares of the Fund may be purchased only by separate accounts
("Separate Accounts") established by First Allmerica Financial Life Insurance
Company ("First Allmerica") or Allmerica Financial Life Insurance and Annuity
Company ("Allmerica Financial Life") for the purpose of funding variable annuity
contracts and variable life insurance policies (such contracts and policies are
referred to hereafter as "Contracts") issued by First Allmerica or Allmerica
Financial Life. Both First Allmerica and Allmerica Financial Life are
wholly-owned subsidiaries of Allmerica Financial Corporation ("AFC"), a
publicly-traded Delaware holding company for a group of affiliated companies,
the largest of which is First Allmerica, a life insurance company organized in
Massachusetts in 1844. Subject to certain exceptions with respect to
unregistered Separate Accounts, First Allmerica and Allmerica Financial Life
will vote shares of the Fund held in each Separate Account in accordance with
instructions received from variable life insurance policy owners and variable
annuity contract owners or participants (collectively, "Contract Owners") with
respect to all matters on which Fund Shareholders are entitled to vote. Except
when otherwise permitted by applicable law or regulation, interests in Contracts
for which no Proxies are received will be voted in proportion to the Proxy
instructions which are received from Contract Owners. First Allmerica and
Allmerica Financial Life also will vote shares in a registered Separate Account
that they own and which are not attributable to Contracts in the same
proportion. As of the close of business on April 9, 1998, the date for
determining Shareholders of record for the Meeting, there were 143,522,105.156
shares of the Fund outstanding. On April 9, 1998, the Trustees and officers of
the Trust, as a group, beneficially owned less than 1% of the outstanding shares
of the Fund.
The persons named in the accompanying Proxy will vote in each case as
directed by the Proxy, but in the absence of such voting directions, they intend
to vote FOR each proposal and may vote in their discretion with respect to other
matters not now known to the Board of Trustees that may be presented at the
Meeting.
<PAGE>
APPROVAL OR DISAPPROVAL OF A NEW SUB-ADVISER
AGREEMENT BETWEEN ALLMERICA FINANCIAL INVESTMENT
MANAGEMENT SERVICES, INC.
AND T. ROWE PRICE ASSOCIATES, INC.
The Trustees recommend that the Shareholders of the Fund approve a new
Sub-Adviser Agreement (the "New Sub-Adviser Agreement") between Allmerica
Financial Investment Management Services, Inc. ("AFIMS") and T. Rowe Price
Associates, Inc. ("T. Rowe Price"). Shareholders are asked to approve the New
Sub-Adviser Agreement in accordance with the requirements of the Investment
Company Act of 1940, as amended (the "1940 Act"). The New Sub-Adviser Agreement
is the same in all substantive respects to the previous Sub-Adviser Agreement
(the "Previous Sub-Adviser Agreement"), dated April 28, 1995, in effect between
Allmerica Investment Management Company, Inc. ("AIMCO"), AFIMS's predecessor/1/,
and Janus Capital Corporation ("JCC"), the Fund's former Sub-Adviser, except
that the fee which AFIMS will pay T. Rowe Price differs from the fee structure
in the Previous Sub-Adviser Agreement and the effective and termination dates
are different. A copy of the New Sub-Adviser Agreement is set forth as Exhibit I
to this Proxy Statement. THERE WILL BE NO CHANGE IN ADVISORY FEES PAID BY THE
FUND. AFIMS WILL PAY T. ROWE PRICE'S SUB-ADVISER FEE.
AFIMS manages the business affairs of the Fund pursuant to a Management
Agreement (the "Management Agreement") dated April 16, 1998 between the Trust
and AFIMS. The Management Agreement provides that, subject to the requirements
of the 1940 Act and the rules and regulations thereunder, AFIMS at its expense
may select and contract with a sub-adviser or sub-advisers to manage the
investments of one or more of the Funds in the Trust. AFIMS has selected T. Rowe
Price as sub-adviser to manage the investments of the Fund and such selection
has been approved by the Board of Trustees of the Trust.
BACKGROUND. Prior to the Trustees' appointment of T. Rowe Price as
Sub-Adviser to the Fund, JCC served as Sub-Adviser of the Fund. Under investment
performance criteria and other standards established by AFIMS and BARRA
RogersCasey, Inc. ("BARRA RogersCasey"), a consultant retained by AFIMS, each
Sub-Adviser of the Trust is continuously monitored against relevant indices and
peer groups. Following their review of the consultant's reports with respect to
JCC's performance over an extended period, the Trustees determined to terminate
the Previous Sub-Adviser Agreement between JCC and AIMCO as of the close of
business March 31, 1998, and T. Rowe Price began serving as Sub-Adviser to the
Fund effective April 1, 1998.
In the course of the selection process, AFIMS and BARRA RogersCasey
reviewed performance and background criteria, as well as written and in-person
proposals by a number of investment advisory firms. In evaluating the proposals,
they considered, among other things, the nature and quality of the services to
be provided by each sub-adviser candidate, comparative data as to each sub-
adviser's investment performance, the experience and financial condition of the
sub-adviser and its affiliates, the level of sub-advisory fees to be paid
compared to industry averages, the sub-adviser's commitment to mutual fund
advisory activities and the quality of the sub-adviser's proposal generally.
Based on this review and selection process, AFIMS and
- -----------------------
/1/ As part of a reorganization on April 16, 1998, AIMCO transferred to AFIMS
that portion of its business relating to the provision of investment
advisory services exclusively to investment companies registered under the
1940 Act such as the Trust while AIMCO retained its financial planning
business. The same personnel and procedures previously employed by AIMCO to
service the Trust are used by AFIMS. Both AIMCO and AFIMS are indirect
wholly-owned subsidiaries of AFC.
<PAGE>
BARRA RogersCasey proposed to the Investment Operations Committee/2/ of the
Board of Trustees the selection of T. Rowe Price as Sub-Adviser for the Fund.
After deliberation, the Committee unanimously recommended to the Trustees the
selection of T. Rowe Price as Sub-Adviser and reported on the reasons for this
recommendation. Upon completion of the review process and following a
presentation to the Trustees by T. Rowe Price, the Trustees voted unanimously,
with the "non-interested" Trustees voting separately, to appoint T. Rowe Price
as Sub-Adviser to the Fund and to recommend to Shareholders of the Fund that
they approve the New Sub-Adviser Agreement.
INFORMATION REGARDING T. ROWE PRICE ASSOCIATES, INC.
Founded in 1937, T. Rowe Price is a publicly held company located at
100 East Pratt Street, Baltimore, Maryland 21202. As of December 31, 1997, T.
Rowe Price and its affiliates managed assets totaling approximately $125 billion
for more than six million individual and institutional investor accounts. None
of the Trustees and officers of the Trust are affiliated with T. Rowe Price.
T. Rowe Price emphasizes risk management and in-house fundamental
research in its investment approach. Portfolio managers work in teams and are
expected to adhere to well-defined investment guidelines. The firm seeks to
achieve superior long-term performance by investing in the stocks of
medium-sized companies, with earnings growth rates in excess of the market and
proven business concepts.
Exhibit II attached to this Proxy Statement contains information on the
type, size and advisory fees of other similar investment company funds managed
by T. Rowe Price. All information about T. Rowe Price has been provided by T.
Rowe Price.
T. Rowe Price International Series, Inc., an investment company managed
by a T. Rowe Price affiliate, is currently used as an investment vehicle for
certain insurance products sponsored by First Allmerica and Allmerica Financial
Life. In addition, the same T. Rowe Price affiliate currently serves as
investment adviser to a corporate investment account of AFC.
- --------------------------
/2/ The Investment Operations Committee is composed of three Trustees who are
"non-interested" persons of the Trust, AFIMS or the Sub-Adviser or their
affiliates, two Trustees who are "interested" persons and two non-Trustee
participants. The Committee monitors investment adviser performance and
analyzes fund data.
<PAGE>
PRINCIPAL EXECUTIVE OFFICERS AND DIRECTORS OF T. ROWE PRICE ASSOCIATES,
INC.
The principal executive officers and directors of T. Rowe Price and
their principal occupations are shown below. The business address of each such
person, unless otherwise indicated, is 100 East Pratt Street, Baltimore,
Maryland 21202.
<TABLE>
<CAPTION>
- ---------------------------------- --------------------------------- --------------------------------------------
NAME POSITION WITH T. ROWE PRICE PRINCIPAL OCCUPATION
- ---------------------------------- --------------------------------- --------------------------------------------
<S> <C> <C>
George J. Collins Director
- ---------------------------------- --------------------------------- --------------------------------------------
James E. Halbkat, Jr. Director President of U.S. Monitor Corp.
P.O. Box 23109
Hilton Head Island, SC 29925
- ---------------------------------- --------------------------------- --------------------------------------------
Richard L. Menschel Director Limited Partner of Goldman Sachs Group L.P.
85 Broad St., 2nd Floor
New York, NY 10004
- ---------------------------------- --------------------------------- --------------------------------------------
John W. Rosenblum Director Dean of the Jepson School of Leadership
University of Richmond Studies at the University of Richmond;
Richmond, VA 23173 Director of: Comdial Corp.; Cone Mills
Corp. and Providence Journal Co.
- ---------------------------------- --------------------------------- --------------------------------------------
Robert L. Strickland Director Director of Hannaford Bros., Co.
604 Two Piedmont Plaza Bldg.
Winston-Salem, NC 27104
- ---------------------------------- --------------------------------- --------------------------------------------
Phillip C. Walsh Director Consultant to Cyprus Amax Minerals Company
Pleasant Valley and Director of Piedmont Mining Company,
Peapack, NJ 07977 Inc.
- ---------------------------------- --------------------------------- --------------------------------------------
Anne Marie Whittemore Director Partner of the law firm of McGuire, Woods,
One James Center Battle & Booth; Director of Owens and Minor,
Richmond, VA 23219 Inc., USF&G Corp., Albemarle Corp. and the
James River Corp.
- ---------------------------------- --------------------------------- --------------------------------------------
James S. Riepe Vice-Chairman of the Board, Chairman of the Board of T. Rowe Price
Director and Managing Director (Canada), Inc., T. Rowe Price Investment
Services, T. Rowe Price Investment
Technologies, Inc., T. Rowe Price
Retirement Plan Services, Inc., T. Rowe
Price Services, Inc., and T. Rowe Price
Trust Co., Director of Rowe Price Fleming
International Inc. ("Price-Fleming")
Rhone-Poulenc Rorer, Inc., T. Rowe Price
Insurance Agency, Inc., a Director and
Vice President of T. Rowe Price Stable
Asset Management, Inc., a Director and
President of TRP Distribution, Inc. and
TRP Suburban Second, Inc.
- ---------------------------------- --------------------------------- --------------------------------------------
George A. Roche Chairman of the Board, Chairman of the Board of T. Rowe Price
President and Director Finance, Inc.; a Director of T. Rowe Price
Retirement Plan Services, Inc., T. Rowe
Price Strategic Partners, Inc., and TRP
Suburban, Inc.; Director and Vice
President of Price-Fleming, T. Rowe Price
Threshold Fund, Inc., and TRP Suburban
Second, Inc.
- ---------------------------------- --------------------------------- --------------------------------------------
M. David Testa Vice-Chairman of the Board, Chairman of the Board of Price-Fleming,
Chief Investment Officer, Chairman and Director of T. Rowe Price
Director and Managing Director (Canada), Inc., a Director and Vice
President of T. Rowe Price Trust Co.; and
a Director of TRPH Corp.
- ---------------------------------- --------------------------------- --------------------------------------------
Henry H. Hopkins Director and Managing Director Director of T. Rowe Price Insurance
Agency, Inc.; a Vice President and
Director of T. Rowe Price Investment
Services, Inc., T. Rowe Price Services,
Inc., T. Rowe Price Threshold Fund
Associates, Inc., TRP Distribution, Inc.
and TRPH Corp., and a Vice President of
Price-Fleming
</TABLE>
<PAGE>
<TABLE>
- ---------------------------------- --------------------------------- --------------------------------------------
<S> <C> <C>
James A. C. Kennedy III Director and Managing Director President and Director of T. Rowe Price
Strategic Partners Associates, Inc., and
Director and Vice President of T. Rowe
Price Threshold Fund Associates, Inc.
- ---------------------------------- --------------------------------- --------------------------------------------
John H. Laporte, Jr. Director and Managing Director
- ---------------------------------- --------------------------------- --------------------------------------------
William T. Reynolds Director and Managing Director Chairman of the Board of T. Rowe Price
Stable Asset Management and Director of
TRP Finance, Inc.
- ---------------------------------- --------------------------------- --------------------------------------------
Brian C. Rogers Director and Managing Director Vice President of T. Rowe Price Trust
Company
- ---------------------------------- --------------------------------- --------------------------------------------
</TABLE>
No arrangements or understandings exist between AFIMS and T. Rowe Price
with respect to the composition of the board of directors of T. Rowe Price or
the Board of Trustees of the Trust or with respect to the selection or
appointment of any person to any office with either of them.
DESCRIPTION OF THE PREVIOUS SUB-ADVISER AGREEMENT AND THE NEW SUB-ADVISER
AGREEMENT
The Previous Sub-Adviser Agreement was executed as of April 28, 1995
and was last approved by the Trustees, including the Trustees who were "non-
interested", at a meeting of the Board of Trustees on May 13, 1997. The Previous
Sub-Adviser Agreement was last submitted to Shareholders on August 15, 1997 to
approve amendments to the sub-adviser fee schedule. Except for different
effective and termination dates and the fee schedule, the terms of the New Sub-
Adviser Agreement are similar in all material respects to the terms of the
Previous Sub-Adviser Agreement. The New Sub-Adviser Agreement is attached to
this Proxy Statement as Exhibit I, and the description of the New Sub-Adviser
Agreement set forth in this Proxy Statement is qualified in its entirety by
reference to Exhibit I.
Under the New Sub-Adviser Agreement, T. Rowe Price will, at its expense
and subject to the general oversight of the Trustees and AFIMS, regularly
provide the Fund with investment research, advice and supervision and will
furnish continuously an investment program consistent with the investment
objective and policies of the Fund. For all of its services provided under the
New Sub-Adviser Agreement, T. Rowe Price is paid by AFIMS a fee computed daily
at an annual rate of 0.50% based on the average daily net assets of the Fund,
which were approximately $240,000,000 at December 31, 1997.
Until September 1, 1997, the Previous Sub-Adviser Agreement included
the following sub-adviser fee schedule:
Assets Rate
------ ----
First $100 million 0.60%
Over $100 million 0.55%
Effective September 1, 1997, the sub-adviser fee schedule for the
Previous Sub-Adviser Agreement was changed to the following:
<PAGE>
Assets Rate
------ ----
First $100 million 0.60%
Next $150 million 0.55%
Next $250 million 0.50%
Over $500 million 0.45%
During the fiscal year ended December 31, 1997, AIMCO paid JCC
$1,070,021 for its sub-advisory services pursuant to the fee schedules under the
Previous Sub-Adviser Agreement. If the new sub-adviser fee had been in effect
during the last fiscal year, the Sub-Adviser would have received $927,292,
representing a decrease of $142,729, or 13.34%. The new sub-adviser fee at the
Fund's net assets on April 1, 1998 of approximately $267,349,350 would decrease
annual fees paid by AFIMS to the Sub-Adviser from $1,511,747 to $1,336,747, a
reduction of $175,000 or 11.58%. Any reduction in sub-adviser fees would benefit
AFIMS directly, but does not affect Fund Shareholders since AFIMS is solely
responsible for the payment of all sub-adviser fees.
The Trustees believe that the new sub-adviser fee rate of 0.50% should
provide an effective means of compensating T. Rowe Price for its advisory
services. When compared to the fees paid to JCC, the new sub-adviser fee rate
will reduce sub-adviser fees at current asset levels (approximately
$267,000,000) and will begin to increase sub-adviser fees after Fund assets grow
to more than $500,000,000. The new sub-adviser fee is believed by the Trustees
and AFIMS to be within the range of sub-adviser fees paid by other comparable
funds. Pursuant to rules of the Securities and Exchange Commission, until the
New Sub-Adviser Agreement is approved by Fund Shareholders, T. Rowe Price has
agreed to waive any sub-adviser fees that exceed the compensation which would
have been paid to JCC under the Previous Sub-Adviser Agreement.
The New Sub-Adviser Agreement provides that T. Rowe Price, as
Sub-Adviser, in return for its fee, and subject to the control and supervision
of the Board of Trustees and in conformance with the investment objective and
policies of the Fund set forth in the Trust's current registration statement and
any other policies established by the Board of Trustees or AFIMS, will manage
the investment and reinvestment of assets of the Fund. In this regard, it is the
responsibility of T. Rowe Price to make investment decisions for the Fund and to
place the Fund's purchase and sale orders for investment securities. The New
Sub-Adviser Agreement states that T. Rowe Price will provide at its expense all
necessary investment, management and administrative facilities, including
salaries of personnel and equipment needed to carry out its duties under the New
Sub-Adviser Agreement, but excluding pricing and bookkeeping services.
The New Sub-Adviser Agreement shall remain in full force and effect for
two years from April 1, 1998 and shall continue in full force and effect for
successive periods of one year thereafter, but only so long as each such
continuance is specifically approved annually by the Board of Trustees, or by
vote of the holders of a majority of the Fund's outstanding voting securities,
and by the vote of a majority of the Trustees who are not "interested persons"
of the Trust, AFIMS, the Sub-Adviser, or any other sub-adviser to the Trust. The
New Sub-Adviser Agreement may be terminated at any time, without payment of any
penalty, by AFIMS, subject to the approval of the Trustees, by vote of the
Trustees, by vote of a majority of the outstanding voting securities of the
Fund, or by T. Rowe Price, in each case on 60 days' written notice. As required
by the
<PAGE>
1940 Act, the New Sub-Adviser Agreement will automatically terminate, without
the payment of any penalty, in the event of its assignment. It also will
terminate in the event that the Management Agreement between the Trust and AFIMS
shall have terminated for any reason.
The New Sub-Adviser Agreement provides that, in the absence of (i)
willful misfeasance, bad faith or gross negligence on the part of T. Rowe Price,
or (ii) reckless disregard by T. Rowe Price of its obligations and duties under
the New Sub-Adviser Agreement, T. Rowe Price shall not be liable to the Trust or
the Fund, or to any Shareholder of the Fund, for any act or omission in the
course of, or connected with, rendering services under the New Sub-Adviser
Agreement.
RECOMMENDATION AND REQUIRED VOTE
As provided in the 1940 Act, approval of the New Sub-Adviser Agreement
requires the affirmative vote of a majority (defined in the Miscellaneous
section) of the outstanding voting securities of the Fund. Abstentions have the
effect of a negative vote on the proposal to approve the New Sub-Adviser
Agreement. If the Shareholders of the Fund fail to approve the New Sub-Adviser
Agreement, T. Rowe Price will continue to serve as Sub-Adviser in a manner
consistent with the 1940 Act, until such time as the Trustees select a different
sub-adviser for the Fund.
The Trustees recommend that Shareholders vote to approve the New Sub-Adviser
Agreement.
MISCELLANEOUS
DEFINITION OF MAJORITY. "Majority of the outstanding voting securities"
means the affirmative vote of the lesser of (1) more than 50% of the outstanding
shares of the Fund and (2) 67% or more of the shares of the Fund present at the
Meeting if more than 50% of the outstanding shares are present at the Meeting in
person or by proxy.
METHODS OF TABULATION. Shares represented by proxies that reflect
abstentions and "broker non-votes" (i.e., shares held by brokers or nominees as
to which (i) instructions have not been received from the beneficial owners or
the persons entitled to vote and (ii) the broker or nominee does not have the
discretionary voting power on a particular matter) will be counted as shares
that are present and entitled to vote on the matter for purposes of determining
the presence of a quorum. Votes cast by proxy or in person at the Meeting will
be counted by persons appointed as tellers for the Meeting.
The tellers will count the total number of votes cast "for" approval of
the proposal or proposals for purposes of determining whether sufficient
affirmative votes have been cast. With respect to any proposal, abstentions and
broker non-votes have the effect of a negative vote on the proposal.
BROKER COMMISSIONS. During the fiscal year ended December 31, 1997, no
commissions were paid to brokers affiliated with JCC.
OTHER BUSINESS. The Trustees know of no other business to be brought
before the Meeting. However, if any other matters properly come before the
Meeting, it is the Trustees' intention that proxies which do not contain
specific restrictions to the contrary will be voted on
<PAGE>
such matters in accordance with the judgment of the persons named in the
enclosed form of Proxy.
DATE FOR RECEIPT OF SHAREHOLDERS' PROPOSALS FOR SUBSEQUENT MEETING OF
SHAREHOLDERS. The Trust's Agreement and Declaration of Trust does not provide
for regular annual meetings of Shareholders, and the Fund does not currently
intend to hold such meetings. Shareholder proposals for inclusion in the Fund's
proxy statement for any subsequent meeting must be received by the Trust not
less than 120 days prior to any such meeting.
DISTRIBUTOR, ADMINISTRATOR. Allmerica Investments, Inc. ("AII"), a
wholly-owned subsidiary of AFC, serves as the Distributor for the Trust. AII,
AFIMS and AFC are located at 440 Lincoln Street, Worcester, MA 01653. First Data
Investor Services Group, Inc., a wholly-owned subsidiary of First Data
Corporation, 4400 Computer Drive, Westborough, MA 01581, serves as the Trust's
administrator.
PLEASE EXECUTE AND RETURN THE ENCLOSED PROXY PROMPTLY. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
RICHARD M. REILLY
President
April 24, 1998
Worcester, MA
<PAGE>
FORM OF EXHIBIT I
SUB-ADVISER AGREEMENT
SUB-ADVISER AGREEMENT executed as of April 16, 1998 between ALLMERICA FINANCIAL
INVESTMENT MANAGEMENT SERVICES, INC., a corporation organized and existing under
the laws of the Commonwealth of Massachusetts, (the "Manager") and T. ROWE PRICE
ASSOCIATES, INC. (the "Sub-Adviser"), a corporation organized and existing under
the laws of the state of Maryland.
WITNESSETH:
That in consideration of the mutual covenants herein contained, it is agreed as
follows:
1. SERVICES TO BE RENDERED BY SUB-ADVISER TO THE TRUST
(a) Subject always to the control of the Trustees of Allmerica
Investment Trust (the "Trust"), a Massachusetts business
trust, the Sub-Adviser, at its expense, will furnish
continuously an investment program for the following series of
shares of the Trust: the Select Capital Appreciation Fund (the
"Fund") and such other series of shares as the Trust, the
Manager and the Sub-Adviser may from time to time agree on
(together, the "Funds"). The Sub-Adviser will make investment
decisions on behalf of the Fund and place all orders for the
purchase and sale of portfolio securities. In the performance
of its duties, the Sub-Adviser will comply with the provisions
of the Agreement and Declaration of Trust and Bylaws of the
Trust and the objectives and policies of the Fund, as set
forth in the current Registration Statement of the Trust filed
with the Securities and Exchange Commission ("SEC") and any
applicable federal and state laws, and will comply with other
policies which the Trustees of the Trust (the "Trustees") or
the Manager, as the case may be, may from time to time
determine and which are furnished by notice in writing to the
Sub-Adviser. The Sub-Adviser shall make its officers and
employees available to the Manager from time to time at
reasonable times to review investment policies of the Fund and
to consult with the Manager regarding the investment affairs
of the Fund. In the performance of its duties hereunder, the
Sub-Adviser is and shall be an independent contractor and,
unless otherwise expressly provided or authorized, shall have
no authority to act for or represent the Trust in any way or
otherwise be deemed to be an agent of the Trust.
(b) The Sub-Adviser, at its expense, will furnish (i) all
investment and management facilities, including salaries of
personnel necessary for it to perform the duties set forth in
this Agreement, and (ii) administrative facilities, including
clerical personnel and equipment necessary for the conduct of
the investment affairs of the Fund (excluding brokerage
expenses and pricing and bookkeeping services).
(c) The Sub-Adviser shall place all orders for the purchase and
sale of portfolio investments for the Fund with issuers,
brokers or dealers selected by the Sub-
<PAGE>
Adviser which may include brokers or dealers affiliated with
the Sub-Adviser. In the selection of such brokers or dealers
and the placing of such orders, the Sub-Adviser always shall
seek best execution (except to the extent permitted by the
next sentence hereof), which is to place portfolio
transactions where the Fund can obtain the most favorable
combination of price and execution services in particular
transactions or provided on a continuing basis by a broker or
dealer, and to deal directly with a principal market maker in
connection with over-the-counter transactions, except when it
is believed that best execution is obtainable elsewhere.
Subject to such policies as the Trustees may require, and
consistent with the requirements of Section 28(e) of the
Securities and Exchange Act of 1934, as amended, the Sub-
Adviser shall not be deemed to have acted unlawfully or to
have breached any duty created by this Agreement or otherwise
solely by reason of its having caused the Trust to pay a
broker or dealer that provides brokerage and research services
an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another
broker or dealer would have charged for effecting that
transaction, if the Sub-Adviser determines in good faith that
such excess amount of commission was reasonable in relation to
the value of the brokerage and research services provided by
such broker or dealer, viewed in terms of either that
particular transaction or the overall responsibilities of the
Sub-Adviser and its affiliates with respect to the Trust and
to other clients of the Sub-Adviser as to which Sub-Adviser or
any affiliate of the Sub-Adviser exercises investment
discretion.
2. OTHER AGREEMENTS
It is understood that any of the shareholders, Trustees,
officers and employees of the Trust may be a shareholder, partner,
director, officer or employee of, or be otherwise interested in, the
Sub-Adviser, and in any person controlled by or under common control
with the Sub-Adviser, and that the Sub-Adviser and any person
controlled by or under common control with the Sub-Adviser may have an
interest in the Trust. It is also understood that the Sub-Adviser and
persons controlled by or under common control with the Sub-Adviser have
and may have advisory, management service or other contracts with other
organizations and persons, and may have other interests and businesses.
Nothing contained in this Agreement shall limit or restrict the freedom
of the Sub-Adviser, or any affiliated person thereof, to render
investment management and corporate administrative services to other
investment counsel or to other persons, firms, or corporations, or to
engage in any other business activities.
3. COMPENSATION TO BE PAID BY THE MANAGER TO THE SUB-ADVISER
The Manager will pay to the Sub-Adviser as compensation for
the Sub-Adviser's services rendered a fee, determined as described in
Schedule A which is attached hereto and made a part hereof. Such fee
shall be paid by the Manager and not by the Trust.
4. MATERIAL TO BE FURNISHED TO SUB-ADVISER
2
<PAGE>
During the term of this Agreement, the Manager shall furnish
the Sub-Adviser with any further documents, materials or information that the
Sub-Adviser may reasonably request to enable it to perform its duties pursuant
to this Agreement. The Manager shall furnish to the Sub-Adviser at its principal
office all prospectuses, proxy statements, reports to shareholders, advertising
and sales literature, or other material prepared for distribution to
shareholders of the Fund or the public, which refer to the Sub-Adviser or its
clients in any way, prior to the use thereof, and the Manager shall not use any
such material if the Sub-Adviser reasonably objects in writing seven business
days (or such other time as may be mutually agreed) after receipt thereof. The
Manager shall take reasonable steps to see that material prepared by employees
or agents of the Manager or its affiliates that refer to the Sub-Adviser or its
clients in any way are consistent with those materials previously approved by
the Sub-Adviser as referenced in the preceding sentence.
5. AMENDMENTS OF THIS AGREEMENT
This Agreement (including Schedule A attached hereto) shall
not be amended as to any Fund unless such amendment is approved at a
meeting by the affirmative vote of a majority of the outstanding voting
securities of the Fund, if such approval is required under the
Investment Company Act of 1940, as amended ("1940 Act"), and by the
vote, cast in person at a meeting called for the purpose of voting on
such approval, of a majority of the Trustees who are not interested in
persons of the Trust or of the Manager or of the Sub-Adviser.
6. EFFECTIVE PERIOD AND TERMINATION OF THIS AGREEMENT
This Agreement shall be effective as of the date executed, and
shall remain in full force and effect as to each Fund continuously
thereafter, until terminated as provided below:
(a) Unless terminated as herein provided or pursuant to any
applicable requirements of the 1940 Act or regulations
promulgated thereunder, this Agreement shall remain in full
force and effect through April 1, 2000 and shall continue in
full force and effect for successive periods of one year
thereafter, but only so long as such continuance is
specifically approved at least annually (i) by the Trustees or
by the affirmative vote of a majority of the outstanding
voting securities of the Fund, and (ii) by a vote of a
majority of the Trustees who are not interested persons of the
Trust or of the Manager or of any Sub-Adviser, by vote cast in
person at a meeting called for the purpose of voting on such
approval; provided, however, that if the continuance of this
Agreement is submitted to the shareholders of the Fund for
their approval and such shareholders fail to approve such
continuance of this Agreement as provided herein, the Sub-
Adviser may continue to serve hereunder in a manner consistent
with the 1940 Act and the rules and regulations
thereunder.
3
<PAGE>
(b) This Agreement may be terminated as to any Fund without the
payment of any penalty by the Manager, subject to the approval
of the Trustees, by vote of the Trustees, or by vote of a
majority of the outstanding voting securities of such Fund at
any annual or special meeting or by the Sub-Adviser, in each
case on sixty days' written notice.
(c) This Agreement shall terminate automatically, without the
payment of any penalty, in the event of its assignment or in
the event that the Management Agreement with the Manager shall
have terminated for any reason.
(d) In the event of termination of this Agreement, the Fund will
no longer use the name "T. Rowe Price" or "T. Rowe Price
Associates, Inc." in materials relating to the Fund except as
may be required by the 1940 Act and the rules and regulations
thereunder.
7. CERTAIN DEFINITIONS
For the purpose of this Agreement the "affirmative vote of a majority
of the outstanding voting securities" means the affirmative vote, at a duly
called and held meeting of shareholders, (a) of the holders of 67% or more of
the shares of the Fund present (in person or by proxy) and entitled to the vote
at such meeting, if the holders of more than 50% of the outstanding shares of
the Fund entitled to vote at such meeting are present in person or by proxy, or
(b) of the holders of more than 50% of the outstanding shares of the Fund
entitled to vote at such meeting, whichever is less.
For the purposes of this Agreement, the terms "control", "interested
person" and "assignment" shall have their respective meanings defined in the
1940 Act and rules and regulations thereunder, subject, however, to such
exemptions as may be granted by the SEC under said Act; the term "specifically
approve at least annually" shall be construed in a manner consistent with the
1940 Act and the rules and regulations thereunder; and the term "brokerage and
research services" shall have the meaning given in the Securities Exchange Act
of 1934 and the rules and regulations thereunder.
8. NON-LIABILITY OF SUB-ADVISER
The Sub-Adviser shall be under no liability to the Trust, the Manager
or the Trust's Shareholders or creditors for any matter or thing in connection
with the performance of any of the Sub-Adviser's services hereunder or for any
losses sustained or that may be sustained in the purchase, sale or retention of
any investment for the Funds of the Trust made by it in good faith; provided,
however, that nothing herein contained shall be construed to protect the
Sub-Adviser against any liability the Trust by reason of the Sub-Adviser's own
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
hereunder.
4
<PAGE>
9. LIMITATIONS OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
A copy of the Trust's Agreement and Declaration of Trust is on file
with the Secretary of the Commonwealth of Massachusetts, and notice is hereby
given that this instrument is executed by the Trustees as Trustees and not
individually and that the obligations of this instrument are not binding upon
any of the Trustees, officers or shareholders individually but are binding only
upon the assets and property of the appropriate Fund.
IN WITNESS WHEREOF, Allmerica Financial Investment Management Services, Inc. has
caused this instrument to be signed in duplicate on its behalf by its duly
authorized representative and T. Rowe Price Associates, Inc. has caused this
instrument to be signed in duplicate on its behalf by its duly authorized
representative, all as of the day and year first above written.
ALLMERICA FINANCIAL INVESTMENT
MANAGEMENT SERVICES, INC.
By:
----------------------------------------
Title:
----------------------------------------
T. ROWE PRICE ASSOCIATES, INC.
By:
----------------------------------------
Title:
----------------------------------------
Accepted and Agreed to as of the day and year first above written:
ALLMERICA INVESTMENT TRUST
By:
----------------------------------------
Title:
----------------------------------------
5
<PAGE>
SCHEDULE A
----------
The Manager will pay to the Sub-Adviser as full compensation for the
Sub-Adviser's services rendered, a fee computed daily and paid quarterly at an
annual rate based on the average daily net assets of the Fund as described
below:
FUND FEE RATE
Select Capital Appreciation Fund 0.50%
The average daily net assets of the Fund shall be determined by taking
an average of all of the determinations of net assets during each month at the
close of business on each business day during such month while this Agreement is
in effect.
The fee for each quarter shall be payable within ten (10) business days
after the end of the quarter.
If the Sub-Adviser shall serve for any period less than a full month,
the foregoing compensation shall be prorated according to the proportion which
such period bears to a full month.
6
<PAGE>
EXHIBIT II
----------
T. ROWE PRICE ASSOCIATES, INC.
FUNDS WITH OBJECTIVES SIMILAR TO
ALLMERICA INVESTMENT TRUST
SELECT CAPITAL APPRECIATION FUND
T. Rowe Price Associates, Inc. ("T. Rowe Price") sponsors and acts as
investment adviser to two registered investment companies having similar
investment objectives and policies to those of the Select Capital Appreciation
Fund:
(i) T. Rowe Price Mid-Cap Growth Fund ("MGF") and
(ii) T. Rowe Price Mid-Cap Growth Portfolio ("MGP")
MGF's Management Fee. For its services to MGF, T. Rowe Price is paid a
- --------------------
management fee consisting of two parts: (i) a "group" fee and (ii) an
"individual" fee.
- The "group" fee, which is designed to reflect the benefits of the
shared resources of the T. Rowe Price investment management complex,
varies based on the combined net assets of certain funds distributed
by T. Rowe Price Investment Services, Inc. (excluding T. Rowe Price
Index Trust, T. Rowe Price Spectrum Funds and any institutional and
private label mutual funds) (the "Combined Price Funds"). MGF pays,
as a portion of the "group" fee, an amount equal to the ratio of its
daily net assets to the daily net assets of all the Combined Price
Funds.
The current "group" fee rate at various asset levels of the Combined Price
Funds is as follows:
.480% first $1 billion
.450% next $1 billion
.420% next $1 billion
.390% next $1 billion
.370% next $1 billion
.360% next $2 billion
.350% next $2 billion
.340% next $5 billion
.330% next $10 billion
.320% next $10 billion
.310% next $16 billion
.305% next $30 billion
.300% thereafter
The "group fee" for MGF was .32% as of December 31, 1997.
- MGF also pays a flat "individual" fund fee of .35% on its net assets.
<PAGE>
MGP's Management Fee. MGP pays T. Rowe Price a single, all inclusive fee of .85%
- --------------------
based on the fund's average daily net assets to cover investment management and
operating expenses.
* * * * * * * * * *
T. Rowe Price also acts as investment sub-adviser to several registered
investment companies ("Subadvised Mutual Funds") having similar investment
objectives and policies to those of the Select Capital Appreciation Fund. For
this purpose, the Subadvised Mutual Funds are mutual funds that are not
sponsored or distributed by T. Rowe Price.
* * * * * * * * * *
The table below lists the investment companies which have similar
investment objectives and policies as the Select Capital Appreciation Fund, the
annual rate of compensation paid to T. Rowe Price and net assets as of December
31, 1997.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
Investment Company Investment Annual Rate of Compensation Net Assets as of
Name Objective 12/31/97
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$126 billion
T. Rowe Price Associates, under management
Inc.
- ------------------------------------------------------------------------------------------------------------
T. Rowe Price Long-term capital .35% (Individual fee) $1,838.7 million
Mid-Cap Growth Fund appreciation plus group fee*
("MGF")
- ------------------------------------------------------------------------------------------------------------
T. Rowe Price Long-term capital .85% $15.3 million
Mid-Cap Growth Portfolio appreciation (Covers investment management
("MGP") and operating expenses)
- ------------------------------------------------------------------------------------------------------------
Subadvised Mutual
Funds
- ------------------------------------------------------------------------------------------------------------
JNL Series Trust Long-term capital .60% on assets from $0 - $20 million $127,052,569
T. Rowe Price/JNL appreciation .50% on assets from $20 - $50 million
Mid-Cap Growth Series .50% on assets from $50 - $200 million
.50% on assets over $200 million
- ------------------------------------------------------------------------------------------------------------
Maxim Series Trust Long-term capital
Maxim Mid-Cap Growth appreciation .50% on all assets $56,704,297
Portfolio
- ------------------------------------------------------------------------------------------------------------
Green Line Mutual Funds Long-term capital
Green Line U.S. Mid-Cap appreciation .50% on all assets $123,284,415
Growth Fund
- ------------------------------------------------------------------------------------------------------------
Style Select Series, Inc. Long-term capital
Mid-Cap Growth Portfolio appreciation .50% on all assets $22,671,912
- ------------------------------------------------------------------------------------------------------------
</TABLE>
*See description of the group and individual fee above.
<PAGE>
ALLMERICA INVESTMENT TRUST
PROXY
SELECT CAPITAL APPRECIATION FUND
(A SERIES OF ALLMERICA INVESTMENT TRUST)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.
The undersigned hereby appoints Richard M. Reilly, Thomas P. Cunningham
and George M. Boyd, and each of them, attorneys and proxies of the undersigned,
with full power of substitution, and does hereby request that the votes
attributable to all of the undersigned's shares be cast as directed, with all
powers the undersigned would possess if personally present, at the Special
Meeting of Shareholders of the Select Capital Appreciation Fund (the "Fund") of
Allmerica Investment Trust to be held at 440 Lincoln Street, Worcester,
Massachusetts 01653, on Wednesday, June 3, 1998 at 10:00 a.m., local time, and
at any adjournment thereof.
Dated____________________, 1998
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY
PROMPTLY USING THE ENCLOSED ENVELOPE.
Please sign exactly as the name appears hereon.
When signing as attorney, executor,
administrator, trustee or guardian, please give
full title as such. If a corporation, please
sign in full corporate name by president or
other authorized officer. If a partnership,
please sign in partnership name by authorized
person. If joint owners, each owner should
sign.
Note: The undersigned hereby acknowledges
receipt of the Notice of Special Meeting and
Proxy Statement, and revokes any Proxy
heretofore given with respect to the votes
covered by this Proxy.
----------------------------------------------
----------------------------------------------
Signature(s)
<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE SHAREHOLDER. IF NO DIRECTION IS MADE, THE PROXY WILL BE VOTED "FOR" ALL
PROPOSALS. IF A PROXY IS NOT RECEIVED FROM A PARTICULAR SHAREHOLDER, EXCEPT WHEN
OTHERWISE PERMITTED BY APPLICABLE LAW, THEN THE VOTES ATTRIBUTABLE TO HIS OR HER
INTEREST WILL BE ALLOCATED IN THE SAME RATIO AS VOTES FOR WHICH INSTRUCTIONS
HAVE BEEN RECEIVED. THE MAILING DATE OF THIS PROXY IS ON OR ABOUT APRIL 24,
1998.
PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW.
THE TRUSTEES RECOMMEND VOTING "FOR" THE PROPOSAL. FOR AGAINST ABSTAIN
1. Proposal to approve or disapprove a new [_] [_] [_]
Sub-Adviser Agreement between Allmerica
Financial Investment Management Services, Inc.
and T. Rowe Price Associates, Inc. relating
to the Fund.
2. In their discretion, the named proxies are
authorized to transact such other business as
may properly come before the Meeting, or any
adjournment thereof.
BE SURE TO VOTE, AND SIGN AND DATE THIS PROXY ON REVERSE SIDE.
<PAGE>
[PASTE-UP LETTERHEAD HERE]
April 24, 1998
Dear Valued Client:
The enclosed proxy materials relate to a Special Meeting of
Shareholders of the Select Capital Appreciation Fund (the "Fund"), a series of
Allmerica Investment Trust, to be held on June 3, 1998 at 10:00 a.m., local
time, here in our offices at 440 Lincoln Street, Worcester, Massachusetts 01653
(the "Meeting").
At the Meeting, Shareholders will be asked to approve a new Sub-Adviser
Agreement (the "New Sub-Adviser Agreement") between Allmerica Financial
Investment Management Services, Inc. ("AFIMS"), the Manager of the Fund, and T.
Rowe Price Associates, Inc. ("T. Rowe Price"). Following an intensive review
process, your Trustees voted to terminate the previous Sub-Adviser Agreement
(the "Previous Sub-Adviser Agreement") with Janus Capital Corporation ("JCC"),
the previous Sub-Adviser, as of March 31, 1998, and appointed T. Rowe Price to
serve as Sub-Adviser effective April 1, 1998. The Trustees are recommending that
Shareholders approve the New Sub-Adviser Agreement with T. Rowe Price at the
Meeting.
The terms of the New Sub-Adviser Agreement are similar in all material
respects to the terms of the Previous Sub-Adviser Agreement, except for the fee
schedule and different effective and termination dates. The New Sub-Adviser
Agreement with T. Rowe Price includes a new sub-adviser fee arrangement. Under
the New Sub-Adviser Agreement, T. Rowe Price is paid by AFIMS a fee computed
daily at an annual rate of 0.50% based on the average daily net asset value of
the Fund. When compared to the fees paid to JCC under the Previous Sub-Adviser
Agreement, the new sub-adviser fee rate will reduce sub-adviser fees at the
current fund asset level (approximately $267,000,000) and will increase
sub-advisory fees after assets grow to more than $500,000,000. Since AFIMS is
solely responsible for the payment of all sub-adviser fees, any reduction of
sub-adviser fees would benefit AFIMS directly, but would not affect Fund
Shareholders. Likewise, the increase in fees as assets exceed $500,000,000 would
be borne solely by AFIMS, not by Fund Shareholders. There will be no change in
the advisory fees paid by the Fund to AFIMS. Under rules of the Securities and
Exchange Commission, until the New Sub-Adviser Agreement is approved by Fund
Shareholders, T. Rowe Price has agreed to waive any sub-adviser fees that exceed
the compensation which would have been paid to JCC under the Previous Sub-
Adviser Agreement.
Although the Trustees would like very much to have you attend the
Meeting, they realize that this is not always possible. Whether or not you plan
to be present at the Meeting, YOUR VOTE IS NEEDED. PLEASE COMPLETE, SIGN AND
RETURN THE ENCLOSED PROXY CARD PROMPTLY IN THE POSTAGE-PAID ENVELOPE PROVIDED.
<PAGE>
Your Trustees look forward to seeing you at the Meeting or receiving
your proxy so your shares may be voted at the Meeting.
Sincerely yours,
/s/ Richard M. Reilly
Richard M. Reilly
President
SHAREHOLDERS ARE URGED TO SIGN AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED
ENVELOPE SO AS TO BE REPRESENTED AT THE MEETING.
<PAGE>
Allmerica Investment Trust
440 Lincoln Street
Worcester, Massachusetts 01653
- --------------------------------------------------------------------------------
IMPORTANT NOTICE
Our records indicate that you have more than one account in the Select Capital
Appreciation Fund. To avoid the expense of multiple mailings, we have enclosed a
proxy card for each of your accounts in this mailing.
Please sign, date and return all proxy cards in the enclosed postage-paid
envelope.
Thank you for your cooperation and prompt attention to this matter.
