SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
MIMLIC Series 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), 14a-6(i)(2) or
Items 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 transactions 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:
[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:
MIMLIC SERIES FUND, INC.
400 ROBERT STREET NORTH
SAINT PAUL, MINNESOTA
NOTICE OF SPECIAL MEETING OF
SHAREHOLDERS OF THE CAPITAL APPRECIATION PORTFOLIO
APRIL 23, 1996
NOTICE IS HEREBY GIVEN that a Special Meeting of the Shareholders of the
Capital Appreciation Portfolio (the "Portfolio") of MIMLIC Series Fund, Inc.
(the "Fund") will be held at the principal office of the Fund, 400 Robert
Street North, Saint Paul, Minnesota, at 10:30 a.m., Tuesday, April 23, 1996,
for the following purposes:
1. To approve or disapprove a new Investment Sub-Advisory Agreement between
MIMLIC Asset Management Company, the investment adviser to the Portfolio, and
Winslow Capital Management, Inc., the Portfolio's investment sub-adviser.
APPROVAL OF THIS PROPOSAL WILL NOT RESULT IN ANY INCREASE IN THE FEES AND
EXPENSES INCURRED BY THE PORTFOLIO OR THE FUND.
2. To transact such other business as may properly come before the meeting or
at any adjournment thereof.
Pursuant to the Bylaws of the Fund and a resolution of the Board of
Directors, the number of votes which each Shareholder of the Portfolio may
cast will be determined as of March 6, 1996. To be entitled to vote, an
otherwise qualified Shareholder must have been a Shareholder of the Portfolio
on March 6, 1996, the record date. The number of votes to which you are
entitled is shown on the enclosed form of proxy.
WHETHER OR NOT YOU PLAN TO ATTEND THE REGULAR MEETING, YOU ARE REQUESTED TO
SIGN, DATE AND RETURN PROMPTLY THE ENCLOSED PROXY. If you do attend the
meeting, you may revoke the Proxy and vote in person. THE DIRECTORS RECOMMEND
THAT VOTES BE CAST IN FAVOR OF ITEM 1.
Paul H. Gooding
President
Saint Paul, Minnesota
March 8, 1996
F. 33859 3-96
MIMLIC SERIES FUND, INC.
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
OF THE CAPITAL APPRECIATION PORTFOLIO
APRIL 23, 1996
THE MEETING
The accompanying Proxy is solicited on behalf of the Board of Directors of
MIMLIC Series Fund, Inc. (the "Fund"), 400 Robert Street North, Saint Paul,
Minnesota 55101-2098, to be voted at a Special Meeting of Shareholders of the
Capital Appreciation Portfolio (the "Portfolio") of the Fund to be held on
April 23, 1996, at 10:30 a.m. and at any adjournment thereof (the "Meeting").
The sole matter to be submitted to shareholders of the Portfolio is a
proposal to approve a new Investment Sub-Advisory Agreement between MIMLIC
Asset Management Company ("MIMLIC Management"), the investment adviser to the
Portfolio, and Winslow Capital Management, Inc. ("Winslow Management"), the
Portfolio's investment sub-adviser. THE DIRECTORS RECOMMEND THAT VOTES BE
CAST IN FAVOR OF THIS PROPOSAL.
This Proxy Statement and accompanying Proxy are being mailed commencing
approximately on March 13, 1996, or as soon thereafter as is practicable, to
contract owners entitled to instruct The Minnesota Mutual Life Insurance
Company ("Minnesota Mutual") as to how certain shares held in Minnesota
Mutual's separate accounts should be voted at the Meeting. The cost of Proxy
solicitation, including the cost of preparing and mailing the Notice of
Special Meeting of Shareholders and this Proxy Statement, will be paid by the
Portfolio. Representatives of the Fund or MIMLIC Management may, without cost
to the Fund, solicit Proxies for the management of the Fund by means of mail,
telephone or personal interview.
Only Portfolio shareholders of record on March 6, 1996, may vote at the
Meeting. As of that date, the Capital Appreciation Portfolio of the Fund had
76,725,976.4789 shares of Capital Stock, at $.01 par value, issued and
outstanding.
As a general matter, all shares of all portfolios of the Fund have equal
voting rights, except that only shares of a particular portfolio are entitled
to vote upon certain matters pertaining only to that portfolio. Pursuant to
the Investment Company Act of 1940, as amended (the "1940 Act"), and the
rules and regulations thereunder, certain matters approved by a vote of all
Fund shareholders may not be binding on a portfolio whose shareholders have
not approved such matter. As the matter which is the sole subject of this
meeting applies only to the Capital Appreciation Portfolio, the Board of
Directors has called this matter to be voted on only by shareholders in that
Portfolio.
A Proxy may be revoked before the meeting by giving written notice of
revocation to Minnesota Mutual, or at the meeting prior to voting. Each
shareholder is entitled to one vote for each share held. The matter to be
presented at the meeting will not entitle any shareholder of the Fund to
cumulative voting or appraisal rights.
GENERAL INFORMATION
MIMLIC Management serves as investment adviser to the Fund and its
portfolios. Winslow Management serves as investment sub-adviser to the
Capital Appreciation Portfolio. Administrative services are provided to the
Fund by Minnesota Mutual. The address of MIMLIC Management and Minnesota
Mutual is 400 Robert Street North, St. Paul, Minnesota 55101. The address of
Winslow Management is 4720 IDS Tower, 80 South Eighth Street, Minneapolis,
Minnesota 55402.
THE ANNUAL REPORT FOR THE FUND, CONTAINING FINANCIAL STATEMENTS FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1995, HAS PREVIOUSLY BEEN MAILED TO THE FUND'S
SHAREHOLDERS. THE FUND WILL PROVIDE A COPY OF SUCH ANNUAL REPORT, FREE OF
CHARGE, TO ANY SHAREHOLDER UPON REQUEST. SUCH REQUESTS SHOULD BE DIRECTED TO
MS. CAROLIE LEWIS AT MINNESOTA MUTUAL, EITHER BY WRITING TO HER AT 400 ROBERT
STREET NORTH, ST. PAUL, MINNESOTA 55101 OR BY TELEPHONING TOLL-FREE AT
1-800-577-2434.
SHARE OWNERSHIP
The Fund currently offers the shares of all its portfolios, including the
Capital Appreciation Portfolio, continuously and without a sales or
redemption charge only to Minnesota Mutual and its separate accounts. In the
Variable Annuity Account, the Group Variable Annuity Account and Minnesota
Mutual Variable Fund D, the shares fund variable annuity contracts. In the
Variable Life Account and the Variable Universal Life Account the shares fund
variable life insurance policies. The shares are sold directly to those
separate accounts without the use of any underwriter.
The Fund shares held in those separate accounts are voted by Minnesota Mutual
at the annual and special meetings of the Fund. To the extent required by
law, shares attributable to contracts and policies will be voted by Minnesota
Mutual in accordance with instructions received from contract owners with
voting interests in each sub-account of the separate accounts. In the event
no instructions are received from contract owners, with respect to shares of
a portfolio held by those sub-accounts, Minnesota Mutual will vote such
shares of the portfolio and shares not attributable to contracts in the same
proportion as shares of the portfolio held by those sub-accounts for which
instructions have been received. The number of votes which are available to a
contract owner will be calculated separately for each portfolio of the Fund.
If, however, the 1940 Act or any regulation under the 1940 Act should change
so that Minnesota Mutual may be allowed to vote shares in its own right, then
it may elect to do so.
As the matter which is the sole subject of this meeting applies only to the
Capital Appreciation Portfolio, Minnesota Mutual will vote its shares, as
described in the preceding paragraph, only with respect to shares of the
Capital Appreciation Portfolio held by a sub-account of a separate account on
that single issue.
The contract owner holds the voting interest in each contract during the
accumulation period of each variable annuity contract. The number of votes
will be determined by dividing that portion of the accumulation value of the
contract attributable to each Variable Annuity Account, Group Variable
Annuity Account or Fund D sub-account holding shares of the Capital
Appreciation Portfolio by the net asset value per share of the underlying
shares of the Portfolio held by that sub-account.
The annuitant holds the voting interest in each variable annuity contract
during the annuity period. The number of votes will be determined by dividing
that portion of the reserve for each contract allocated to each Variable
Annuity Account, Group Variable Annuity Account or Fund D sub-account holding
shares of the Capital Appreciation Portfolio by the net asset value per share
of the underlying shares of the Portfolio held by that sub-account. After an
annuity begins, the votes attributable to any particular contract will
decrease as the reserves decrease.
The owner of a variable life insurance policy holds the voting interest in
that policy. The number of votes will be determined by dividing that portion
of each policy's actual cash value in a Variable Life Account or Variable
Universal Life Account sub-account holding shares of the Capital Appreciation
Portfolio by the net asset value per share of the underlying shares of the
Portfolio held by that sub-account.
In determining any voting interest, fractional shares will be recognized.
Minnesota Mutual will notify each contract owner of a Fund Shareholders'
meeting if the shares held for the contract or policy may be voted at such
meeting. It will also send proxy materials and a form of instruction so that
it may be instructed with respect to voting.
As of March 6, 1996, no Directors of the Fund other than Frederick P.
Feuerherm owned any policies or contracts which entitle them to instruct the
voting of any shares at the Meeting. Mr. Frederick P. Feuerherm owns a policy
which, as of the date of this proxy statement, will allow him to instruct the
voting of 1,038 shares of the Capital Appreciation Portfolio. Mr. Donald F.
Gruber, the Secretary of the Fund, and Ms. Bardea C. Huppert, Vice President
of the Fund, own policies which, as of the date of this proxy statement, will
allow them to instruct the voting of 1,372 shares and 622 shares,
respectively, of the Capital Appreciation Portfolio.
PROPOSAL 1
APPROVAL OF A NEW INVESTMENT SUB-ADVISORY AGREEMENT BY
THE CAPITAL APPRECIATION PORTFOLIO
With respect to the Capital Appreciation Portfolio of the Fund, MIMLIC
Management, the investment adviser to the Fund and the Portfolio, proposes to
enter into a new Investment Sub-Advisory Agreement with Winslow Management
(the "New Winslow Agreement"). The New Winslow Agreement would replace the
existing investment sub-advisory agreement between MIMLIC Management and
Winslow Management relating to the Capital Appreciation Portfolio. If
approved by shareholders, the New Winslow Agreement would reduce the fee paid
by MIMLIC Management to Winslow Management for its services as investment
sub-adviser. Approval of the New Winslow Agreement would not, however, result
in any change in the investment advisory agreement between the Fund and
MIMLIC Management with respect to the Capital Appreciation Portfolio, nor
would it result in any change in the investment advisory fee paid by the
Portfolio to MIMLIC Management.
APPROVAL OF THIS PROPOSAL WILL NOT RESULT IN ANY INCREASE IN THE FEES AND
EXPENSES INCURRED BY THE CAPITAL APPRECIATION PORTFOLIO OR ITS SHAREHOLDERS
NOR WILL IT RESULT IN ANY CHANGE IN THE PORTFOLIO MANAGER PROVIDING
INVESTMENT MANAGEMENT SERVICES TO THE PORTFOLIO.
THE CURRENT ADVISORY AGREEMENT BETWEEN THE FUND AND MIMLIC MANAGEMENT
MIMLIC Management has been the investment adviser and manager of the Fund
since the Fund began business in 1985. It acts as such pursuant to written
agreements periodically approved by the directors or shareholders of the
Fund. The address of MIMLIC Management is that of the Fund. Winslow
Management serves as investment sub-adviser to the Fund's Capital
Appreciation Portfolio pursuant to an investment sub-advisory agreement with
MIMLIC Management. Templeton Investment Counsel, Inc. ("Templeton Counsel")
serves as investment sub-adviser to the Fund's International Stock Portfolio
pursuant to an investment sub-advisory agreement with MIMLIC Management.
MIMLIC Management is a wholly-owned subsidiary of Minnesota Mutual, which was
organized in 1880, and has assets of approximately $9.8 billion. Paul H.
Gooding, President, Treasurer, and a director of MIMLIC Management is a Vice
President and Treasurer of Minnesota Mutual. Frederick P. Feuerherm, Vice
President, Assistant Secretary and a director of MIMLIC Management is a
Second Vice President of Minnesota Mutual. Messrs. Gooding and Feuerherm are
also Directors of the Fund. Information concerning all of MIMLIC Management's
principal officers and directors is set forth in Exhibit A.
MIMLIC Management acts as investment adviser and manager of the Growth, Bond,
Money Market, Asset Allocation and Mortgage Securities Portfolios of the Fund
under an Investment Advisory Agreement dated January 30, 1986, which became
effective the same date when approved by shareholders, and which was last
approved by the Board of Directors (including a majority of the directors who
are not parties to the contract, or interested persons of any such party) on
January 17, 1996. MIMLIC Management acts as investment adviser and manager of
the Index 500 and Capital Appreciation Portfolios of the Fund under a
Supplemental Investment Advisory Agreement dated April 28, 1987, which became
effective the same date when approved by shareholders of those two
Portfolios, and which was last approved by the Board of Directors (including
a majority of the directors who are not parties to the contract, or
interested persons of any such party) on January 17, 1996. MIMLIC Management
acts as investment adviser and manager of the International Stock Portfolio
under the Second Supplemental Investment Advisory Agreement dated April 27,
1993, which was last approved by the shareholders of that Portfolio on April
27, 1993, and which was last approved by the Board of Directors (including a
majority of the directors who are not parties to the contract, or interested
persons of any such party) on January 17, 1996. MIMLIC Management acts as
investment adviser and manager of the Small Company Portfolio under the Third
Supplemental Investment Advisory Agreement dated April 27, 1993, which became
effective the same date when approved by the shareholders of that Portfolio,
and which was last approved by the Board of Directors (including a majority
of the directors who are not parties to the contract, or interested persons
of any such party) on January 17, 1996. MIMLIC Management acts as investment
adviser and manager of the Value Stock Portfolio and the four Maturing
Government Bond Portfolios of the Fund under the Fourth Supplemental
Investment Advisory Agreement dated April 19, 1994, which became effective on
April 25, 1994 when approved by shareholders of those Portfolios, and which
was last approved by the Board of Directors (including a majority of the
directors who are not parties to the contract, or interested persons of any
such party) on January 17, 1996.
The Investment Advisory Agreement, the Supplemental Investment Advisory
Agreement, the Second Supplemental Investment Advisory Agreement, the Third
Supplemental Investment Advisory Agreement and the Fourth Supplemental
Investment Advisory Agreement (collectively, the "Agreements") will each
terminate automatically in the event of its assignment. In addition, the
Agreements are terminable at any time, without penalty, by the Board of
Directors of the Fund or by vote of a majority of the Fund's outstanding
voting securities on 60 days' written notice to MIMLIC Management, and by
MIMLIC Management on 60 days' written notice to the Fund. Unless sooner
terminated, the Agreements shall continue in effect for more than two years
after its execution only so long as such continuance is specifically approved
at least annually either by the Board of Directors of the Fund or by a vote
of a majority of the outstanding voting securities, provided that in either
event such continuance is also approved by the vote of a majority of the
directors who are not interested persons of any party to the Agreements, cast
in person at a meeting called for the purpose of voting on such approval. The
required shareholder approval of any continuance of the Agreements shall be
effective with respect to any Portfolio if a majority of the outstanding
voting securities of the class of capital stock of that Portfolio votes to
approve such continuance, notwithstanding that such continuance may not have
been approved by a majority of the outstanding voting securities of the Fund.
If the shareholders of a class of capital stock of any Portfolio fail to
approve any continuance of the Agreements, MIMLIC Management will continue to
act as investment adviser with respect to such Portfolio pending the required
approval of its continuance, or a new contract with MIMLIC Management or a
different adviser or other definitive action; provided, that the compensation
received by MIMLIC Management in respect of such Portfolio during such period
will be no more than its actual costs incurred in furnishing investment
advisory and management services to such Portfolio or the amount it would
have received under the Agreement in respect of such Portfolio, whichever is
less.
The Agreements may be amended by the parties only if such amendment is
specifically approved by the vote of a majority of the outstanding voting
securities of the Fund and by the vote of a majority of the directors of the
Fund who are not interested persons of any party to the Agreement cast in
person at a meeting called for the purpose of voting on such approval. The
required shareholder approval shall be effective with respect to any
Portfolio if a majority of the outstanding voting securities of the class of
capital stock of that Portfolio vote to approve the amendment,
notwithstanding that the amendment may not have been approved by a majority
of the outstanding voting securities of the Fund.
MIMLIC Management selects and reviews the Fund's investments, and provides
executive and other personnel for the management of the Fund. The Fund's
Board of Directors supervises the affairs of the Fund as conducted by MIMLIC
Management. Each Portfolio of the Fund, except the Index 500, Capital
Appreciation, International Stock, Small Company, Value Stock and the
Maturing Government Bond Portfolios, pays MIMLIC Management a fee equal to an
annual rate of .50% of average daily net assets. The Index 500, Capital
Appreciation, Small Company and Value Stock Portfolios pay MIMLIC Management
a fee equal to an annual rate of .40%, .75%, .75% and .75%, respectively, of
average daily net assets. International Stock Portfolio pays MIMLIC
Management a fee equal to an annual rate of 1.00% on the first $10 million of
average daily net assets, .90% on the next $15 million, .80% on the next $25
million, .75% on the next $50 million and .65% on the next $100 million and
thereafter. The Maturing Government Bond Portfolios pay an advisory fee equal
to an annual rate of .25% of average daily net assets, however, the Portfolio
which matures in 1998 will pay a rate of .05% from its inception to April 30,
1998 and .25% thereafter and the Portfolio which matures in 2002 will pay a
rate of .05% from its inception to April 30, 1998 and .25% thereafter of
average daily net assets.
From its advisory fee for the Capital Appreciation Portfolio, MIMLIC
Management pays Winslow Management a fee equal to .50% on the first $75
million of average daily net assets and .45% of all net assets in excess of
$75 million for its services under its Investment Sub-Advisory Agreement.
From its advisory fee for the International Stock Portfolio, MIMLIC
Management pays Templeton Counsel a fee equal to .75% on the first $10
million of average daily net assets, .65% on the next $15 million, .55% on
the next $25 million, .50% on the next $50 million and .40% on the next $100
million and thereafter for its services under its Investment Sub-Advisory
Agreement.
The advisory fees paid by the Capital Appreciation, International Stock,
Small Company and Value Stock Portfolios are not higher than the advisory
fees paid by many funds with similar investments and investment policies, but
they are higher than that paid by most funds to their investment advisers.
For these fees, MIMLIC Management acts as investment adviser and manager for
the Fund, except as those duties have been delegated pursuant to the
investment sub-advisory agreements with Winslow Management and Templeton
Counsel. MIMLIC Management also provides executive and other personnel for
the management of the Fund. MIMLIC Management also furnishes the Fund office
space and all necessary office facilities and equipment and personnel for
servicing the investments of the Fund. For the year ended December 31, 1995,
the various Portfolios paid the following amounts as investment advisory
fees:
ADVISORY
PORTFOLIO FEES PAID
----------------------------------------
Growth $ 905,136
Bond 435,045
Money Market 126,630
Asset Allocation 1,538,272
Mortgage Securities 322,465
Index 500 388,206
Capital Appreciation 1,071,527
International Stock 955,095
Small Company 552,670
Value Stock 141,207
Maturing Government Bond --
1998 Portfolio 2,184
2002 Portfolio 1,441
2006 Portfolio 5,450
2010 Portfolio 2,888
The Fund pays all its costs and expenses which are not assumed by MIMLIC
Management. These Fund expenses include, by way of example, but not by way of
limitation, all expenses incurred in the operation of the Fund including,
among others, interest, taxes, brokerage fees and commissions, fees of the
directors who are not employees of MIMLIC Management or any of its
affiliates, expenses of directors' and shareholders' meetings, including the
cost of printing and mailing proxies, expenses of insurance premiums for
fidelity and other coverage, association membership dues, charges of
custodians, auditing and legal expenses. The Fund will also pay the fees and
bear the expense of registering and maintaining the registration of the Fund
and its shares with the Securities and Exchange Commission and registering or
qualifying its shares under state or other securities laws and the expense of
preparing and mailing prospectuses and reports to shareholders. MIMLIC
Management shall bear all advertising and promotional expenses in connection
with the distribution of the Fund's shares, including paying for the printing
of Prospectuses and Statements of Additional Information for new
shareholders, shareholder reports for new shareholders and the costs of sales
literature.
Subsequent to March 6, 1987, Minnesota Mutual has voluntarily agreed to
absorb all fees and expenses that exceed .65% of average daily net assets for
the Growth, Bond, Money Market, Asset Allocation, and Mortgage Securities
Portfolios, .55% of average daily net assets for the Index 500 Portfolio,
.90% of average daily net assets for the Capital Appreciation, Small Company
and Value Stock Portfolios and expenses that exceed 1.00% for the
International Stock Portfolio, other than the advisory fee which may not
exceed 1.00%. In addition, Minnesota Mutual has voluntarily agreed to absorb
all fees and expenses that exceed .40% of average daily net assets for each
of the four Maturing Government Bond Portfolios; however, for the Portfolios
which mature in 1998 and 2002, Minnesota Mutual has voluntarily agreed to
absorb such fees and expenses which exceed .20% of average daily net assets
from the Portfolio's inception to April 30, 1998 and which exceed .40% of
average daily net assets thereafter. For the year ended December 31, 1995,
the expenses voluntarily absorbed by Minnesota Mutual for the various
Portfolios were as follows:
EXPENSES
VOLUNTARILY
PORTFOLIO ABSORBED
------------------------------------------
Growth $ -0-
Bond -0-
Money Market -0-
Asset Allocation -0-
Mortgage Securities -0-
Index 500 -0-
Capital Appreciation -0-
International Stock -0-
Small Company -0-
Value Stock 11,610
Maturing Government Bond --
1998 Portfolio 22,794
2002 Portfolio 24,709
2006 Portfolio 25,199
2010 Portfolio 26,308
There is no specified or minimum period of time during which Minnesota Mutual
has agreed to continue its voluntary absorption of these expenses, and
Minnesota Mutual may in its discretion cease its absorption of expenses at
any time. Should Minnesota Mutual cease absorbing expenses the effect would
be to increase substantially Fund expenses and thereby reduce investment
return.
Each Portfolio will bear all expenses that may be incurred with respect to
its individual operation, including but not limited to transaction expenses,
advisory fees, brokerage, interest, taxes and the charges of the custodian.
The Fund will pay all other expenses not attributable to a specific
Portfolio, but those expenses will be allocated among the Portfolios on the
basis of the size of their respective net assets unless otherwise allocated
by the Board of Directors of the Fund.
In addition, effective May 1, 1992, the Fund entered into an agreement with
Minnesota Mutual under which Minnesota Mutual provides accounting, legal and
other administrative services to the Fund. Prior to May 1, 1996, Minnesota
Mutual provides such services at a monthly cost of $1,500 per Portfolio.
Effective May 1, 1996, Minnesota Mutual will provide such services at a
monthly cost of $2,400 per Portfolio.
The Fund does not execute portfolio brokerage transactions through affiliated
brokers. MIMLIC Sales Corporation, a securities broker-dealer and a
wholly-owned subsidiary of MIMLIC Management, acts as distributor for a group
of mutual funds managed by Advantus Capital Management, Inc., also a
wholly-owned subsidiary of MIMLIC Management.
THE CURRENT WINSLOW AGREEMENT
Winslow Management, a Minnesota corporation with offices at 4720 IDS Tower,
80 South Eighth Street, Minneapolis, Minnesota 55402 has been retained under
an investment sub-advisory agreement to provide investment advice and, in
general, to conduct the management and investment program of the Capital
Appreciation Portfolio, subject to the general control of the Board of
Directors of the Fund. Winslow Management is a recent entrant into the
advisory business, having begun business in June of 1992. Winslow Management
is a registered investment adviser under the Investment Advisers Act of 1940.
The firm was established by its investment principals with a focus on
providing management services to growth equity investment accounts. An
additional experienced principal joined the firm in October of 1993.
Information concerning all of Winslow Management's directors and principal
officers is set forth in Exhibit B. Winslow Management has one other
investment company client for which it acts as the investment adviser. Other
assets currently under management are managed for corporate, endowment,
foundation, retirement system and individual clients.
Winslow Management acts as investment sub-adviser to the Fund's Capital
Appreciation Portfolio under an Investment Sub-Advisory Agreement (the
"Current Winslow Agreement") with MIMLIC Management dated October 1, 1992,
which became effective the same date and was approved by shareholders of the
Capital Appreciation Portfolio on November 13, 1992. The Current Winslow
Agreement was last approved for continuance by the Board of Directors of the
Fund, including a majority of the Directors who are not a party to the
Current Winslow Agreement or interested persons of any such party, on January
17, 1996. The Current Winslow Agreement will terminate automatically upon the
termination of the Investment Advisory and Supplemental Investment Advisory
Agreements and in the event of its assignment. In addition, the Current
Winslow Agreement is terminable at any time, without penalty, by the Board of
Directors of the Fund, by MIMLIC Management or by vote of a majority of the
Capital Appreciation Portfolio's outstanding voting securities on 60 days'
written notice to Winslow Management, and by Winslow Management on 60 days'
written notice to MIMLIC Management. Unless sooner terminated, the Current
Winslow Agreement shall continue in effect from year to year if approved at
least annually either by the Board of Directors of the Fund or by a vote of a
majority of the outstanding voting securities of the Capital Appreciation
Portfolio, provided that in either event such continuance is also approved by
the vote of a majority of the Directors who are not interested persons of any
party to the Current Winslow Agreement, cast in person at a meeting called
for the purpose of voting on such approval.
Winslow Management is compensated for its services under the Current Winslow
Agreement by MIMLIC Management, from a portion of the investment advisory fee
received by MIMLIC Management from the Capital Appreciation Portfolio, as
described above under "The Current Advisory Agreement Between the Fund and
MIMLIC Management."
THE NEW WINSLOW AGREEMENT
As described above, MIMLIC Management and Winslow Management propose to
replace the Current Winslow Agreement with the New Winslow Agreement, which,
if approved by shareholders, would become effective on May 1, 1996. The
Current Advisory Agreement between MIMLIC Management and the Fund with
respect to the Capital Appreciation Portfolio would not be modified or
otherwise affected by the proposed New Winslow Agreement. The principal
difference between the Current Winslow Agreement and the New Winslow
Agreement is that the fee received by Winslow Management from MIMLIC
Management would be reduced under the New Winslow Agreement.
Under the Current Winslow Agreement, MIMLIC Management pays a portion of the
investment advisory fee which it receives from the Capital Appreciation
Portfolio to Winslow Management in exchange for its services under the
Current Winslow Agreement. The fee received by Winslow Management under that
Agreement is equal to .50% on the first $75 million of the Capital
Appreciation Portfolio's average daily net assets and .45% of all net assets
of the Portfolio in excess of $75 million. Under the proposed New Winslow
Agreement, the fee paid by MIMLIC Management to Winslow Management would
equal .375% of all average daily net assets of the Capital Appreciation
Portfolio. For the year ended December 31, 1995, the fee received by Winslow
Management from MIMLIC Management under the Current Winslow Agreement was
$681,652. If the New Winslow Agreement had been in effect during that same
period, Winslow Management would have received fees in the aggregate amount
of $535,764 from MIMLIC Management. The difference between these two sums
represents a 21.4% reduction in fees received by Winslow Management.
Approval of the New Winslow Agreement will not change the investment advisory
fee received by MIMLIC Management from the Capital Appreciation Portfolio,
but will, therefore, result in a corresponding increase in the portion of
such investment advisory fee retained by MIMLIC Management after payment of
fees to Winslow Management. Although the investment advisory fee paid to
MIMLIC Management by the Portfolio will not be reduced, MIMLIC Management
will continue its voluntary agreement to absorb all fees and expenses of the
Portfolio that exceed .90% of average daily net assets (see the discussion of
expenses voluntarily absorbed, above, under the heading "The Current Advisory
Agreement Between the Fund and MIMLIC Management"). MIMLIC Management did not
absorb any such fees and expenses during the years ended December 31, 1995,
1994 and 1993, but has previously absorbed such expenses in the amount of
$16,612, $15,552, $7,786, $8,899, $12,636 and $7,450 for the years ended
December 31, 1992, 1991, 1990, 1989 and 1988 and the period from April 28,
1987 to December 31, 1987, respectively.
In the opinion of MIMLIC Management the fee proposed to be paid to Winslow
Management under the New Winslow Agreement results in a more equitable
division of compensation to the parties for their respective services to the
Portfolio, modified as described below. The net assets of the Capital
Appreciation Portfolio, which amounted to $163,519,780 at December 31, 1995,
are now at a level at which economies of scale allow Winslow Management to
provide the same investment management services to the Portfolio at a lower
cost to MIMLIC Management. Under the New Winslow Agreement, Winslow
Management's duties would continue to be limited primarily to making and
executing investment decisions for the Portfolio, while MIMLIC Management
would continue to supervise and monitor the performance of Winslow Management
and to provide the various administrative services described above, under the
heading "The Current Advisory Agreement Between the Fund and MIMLIC
Management," and as also described in the following paragraph. MIMLIC
Management is of the view that the increased level of advisory fees which it
would retain, after the payment of fees to Winslow Management under the New
Winslow Agreement, represents a reasonable level of compensation for the
investment oversight, administrative and other services provided by MIMLIC
Management to the Portfolio.
Under the Current Winslow Agreement, Winslow Management has as one of its
duties the responsibility for transmitting to MIMLIC Management and to the
custodian for the Capital Appreciation Portfolio, on a daily basis, such
confirmation, trade tickets and other documents as may be necessary to enable
them to perform their administrative responsibilities with respect to the
Portfolio. Under the proposed New Winslow Agreement, Winslow Management would
no longer be responsible for transmitting such information to the Portfolio's
custodian. Rather, MIMLIC Management would assume sole responsibility for
transmitting trade tickets and other similar documents and information to the
Portfolio's custodian and for reconciling MIMLIC Management's records of
securities held by the Portfolio with those of the custodian. In all other
respects the investment management and other services performed by Winslow
Management under the New Winslow Agreement would be identical to those
performed under the Current Winslow Agreement.
The personnel currently employed by Winslow Management to provide services to
the Capital Appreciation Portfolio, including the individual portfolio
manager, will continue to provide such services under the New Winslow
Agreement. The terms and provisions of the New Winslow Agreement are
identical in all respects to those of the Current Winslow Agreement except as
described above. The Portfolio and its shareholders will, therefore, continue
to receive substantially the same services from the same investment
professionals if the Proposal is approved. Approval of the Proposal will not
result in any increase or other change in costs to the Portfolio or its
shareholders inasmuch as the advisory fee received by MIMLIC Management from
the Capital Appreciation Portfolio will not be changed. Minnesota Mutual will
also continue to provide the same administrative services to the Portfolio as
before. Approval of the Proposal will not result in any change in the
Portfolio's investment objectives or policies, nor in any change in the
Portfolio's brokerage and allocation practices or in the manner of
distribution of the Portfolio's shares.
The New Winslow Agreement was approved by the Board of Directors of the Fund,
including a majority of the Directors of the Fund who are not parties to such
agreement or interested persons of such parties, on January 17, 1996, at a
meeting called for the purpose of voting on such approval. The New Winslow
Agreement contains the same termination and continuation provisions as the
Current Winslow Agreement, as described above. In considering the Proposal
and determining to recommend to shareholders that they approve the New
Winslow Agreement, the Board of Directors of the Fund relied primarily on the
fact that the Capital Appreciation Portfolio would continue to receive the
same services from the same personnel, except as otherwise described above,
and at the same overall cost. The Directors also considered the nature and
quality of the services provided to the Capital Appreciation Portfolio by
MIMLIC Management and Winslow Management and the level of compensation which
each would receive in relation to those services if the New Winslow Agreement
were effective. The Directors concluded that the relative levels of
compensation between MIMLIC Management and Winslow Management resulting from
approval of the New Winslow Agreement were reasonable in relation to such
services. Based upon these factors, and considering also the views of MIMLIC
Management described above regarding the division of fees between MIMLIC
Management and Winslow Management, the Fund's Board of Directors determined
to approve the New Winslow Agreement. The Directors also considered that
there is no current financial condition of Winslow Management of which the
Directors are aware that is reasonably likely to impair the financial ability
of Winslow Management to fulfill its commitments to the Capital Appreciation
Portfolio under the proposed New Winslow Agreement, and that the New Winslow
Agreement itself is not reasonably likely to result in any such financial
condition.
SHAREHOLDER APPROVAL
Approval of the Proposal requires the affirmative vote of a majority of the
outstanding shares of the Portfolio, which means the lesser of the vote of
(a) 67% of the shares of the Portfolio present at a meeting where more than
50% of the outstanding shares are present in person or by proxy or (b) more
than 50% of the outstanding shares of the Portfolio. Rejection of the
Proposal by the Portfolio would mean that the Current Winslow Agreement would
continue in effect, in which case the Fund's Board of Directors would
reconsider whether or not to seek approval of the same Proposal at a
subsequent meeting.
THE BOARD OF DIRECTORS OF THE FUND RECOMMENDS THAT SHAREHOLDERS APPROVE THE
PROPOSAL TO APPROVE THE NEW INVESTMENT SUB-ADVISORY AGREEMENT WITH WINSLOW
MANAGEMENT.
OTHER MATTERS
Management does not intend to present any business to the meeting not
mentioned in this Proxy Statement and currently knows of no other business to
be presented. If any other matters are brought before the meeting, the
proxies will vote all Proxies on such matters in accordance with their
judgment of the best interests of the Fund.
SHAREHOLDER PROPOSALS
The Fund does not hold annual or periodically scheduled regular meetings of
shareholders. Regular and special shareholder meetings are held only at such
times and with such frequency as required by law. Minnesota corporation law
does not require an annual meeting; instead, it provides for the Board of
Directors to convene shareholder meetings when it deems appropriate. In
addition, if a regular meeting of shareholders has not been held during the
immediately preceding fifteen months, a shareholder or shareholders holding
3% or more of the voting shares of the Fund may demand a regular meeting of
shareholders of the Fund by written notice of demand given to the chief
executive officer or the chief financial officer of the Fund. Within 30 days
after receipt of the demand by one of those officers, the Board of Directors
shall cause a regular meeting of shareholders to be called and held no later
than 90 days after receipt of the demand, all at the expense of the Fund.
Additionally, the Investment Company Act of 1940 requires shareholder votes
for all amendments to fundamental investment policies and restrictions and
for all investment advisory contracts and amendments thereto. Because the
Fund is not required to hold annual meetings of shareholders, an anticipated
date of the next regular meeting cannot be provided. If a shareholder has a
proposal which such shareholder feels should be presented to all
shareholders, the shareholder should send the proposal to the Fund. The
proposal will be considered as appropriate at a meeting of the Board of
Directors as soon as practicable. Should it be a matter which would have to
be submitted to shareholders at a regular meeting, it will be presented at
the next special or regular meeting of shareholders. In addition, should it
be a matter which the Board of Directors deems of such significance as to
require a special meeting, such a meeting will be called.
INFORMATION REGARDING THE FUND'S OFFICERS
Certain information about the executive officers of the Fund is set forth
below:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
NAME OF OFFICER AGE POSITION WITH FUND BUSINESS EXPERIENCE DURING PAST FIVE YEARS
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Paul H. Gooding 55 President and Director Vice President and Treasurer of Minnesota Mutual;
President, Treasurer and a Director of MIMLIC
Management; President of Advantus Capital
Management, Inc.
Frederick P. Feuerherm 49 Treasurer and Director Second Vice President of Minnesota Mutual; Vice
President, Assistant Secretary and a Director
of MIMLIC Management
Bardea C. Huppert 47 Vice President President and Chief Executive Officer of MIMLIC
Sales Corporation; Second Vice President of
Minnesota Mutual
Donald F. Gruber 51 Secretary Senior Counsel of Minnesota Mutual
</TABLE>
The officers of the Fund serve at the pleasure of the Board of Directors of
the Fund. Mr. Gooding has served as a Director and Officer since April, 1987.
Mr. Feuerherm has been a Director and Officer of the Fund since July, 1993.
Ms. Huppert has served in her capacity as Vice President of the Fund since
April, 1994, and Mr. Gruber in his capacity since April, 1988. None of the
Fund's officers and directors has a family relationship with other officers
and directors of the Fund.
Paul H. Gooding
President
March 8, 1996
EXHIBIT A
DIRECTORS AND PRINCIPAL OFFICERS OF
MIMLIC ASSET MANAGEMENT COMPANY
<TABLE>
<CAPTION>
OFFICE WITH
NAME MIMLIC MANAGEMENT OTHER BUSINESS CONNECTIONS
--------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paul H. Gooding President, Treasurer and President, Secretary and Director, MIMLIC Corporation;
Director Director, MIMLIC Imperial Corporation; Director,
MIMLIC Venture Corporation; Vice President and
Director, MIMLIC Funding, Inc.; Vice President and
Director, Robert Street Energy, Inc.; Vice President,
Director, Personal Finance Company; Vice President
and Treasurer, The Minnesota Mutual Life Insurance
Company; President and Director, Advantus Capital
Management, Inc.
Guy M. de Lambert Vice President, Secretary and President and Director, MIMLIC Venture Corporation;
Director Vice President, MIMLIC Funding, Inc.; President and
Secretary, Robert Street Energy, Inc.; President and
Director, Wedgewood Valley Golf, Inc.; Second Vice
President, The Minnesota Mutual Life Insurance Company
Frederick P. Feuerherm Vice President, Assistant Vice President, MIMLIC Funding, Inc.; Second Vice
Secretary and Director President, The Minnesota Mutual Life Insurance Company
Alan J. Notvik Vice President and Assistant President and Director, MIMLIC Funding, Inc.; Second
Secretary Vice President, The Minnesota Mutual Life Insurance
Company
James P. Tatera Vice President and Assistant Vice President, MIMLIC Funding, Inc.; Second Vice
Secretary President, The Minnesota Mutual Life Insurance Company;
Senior Vice President, Treasurer and Director, Advantus
Capital Management, Inc.
Loren Haugland Vice President None
Lynne Mills Vice President Vice President, Robert Street Energy, Inc.; Second
Vice President, The Minnesota Mutual Life Insurance
Company
Marilyn Froelich Vice President None
Dianne Orbison Vice President Vice President, MIMLIC Venture Corporation; Second
Vice President, The Minnesota Mutual Life Insurance
Company
</TABLE>
EXHIBIT B
DIRECTORS AND PRINCIPAL OFFICERS OF
WINSLOW CAPITAL MANAGEMENT, INC.
<TABLE>
<CAPTION>
POSITION WITH
NAME WINSLOW MANAGEMENT OTHER BUSINESS CONNECTIONS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Clark J. Winslow President and Director President, Portfolio Manager and Director, Winslow Capital
Management, Inc.
Gail M. Knappenberger Executive Vice President and Executive Vice President, Portfolio Manager and Director,
Director Winslow Capital Management, Inc.
Richard E. Pyle Executive Vice President and Executive Vice President, Portfolio Manager and Director,
Director Winslow Capital Management, Inc.
Jon R. Foust Managing Director Managing Director, Winslow Capital Management, Inc.
Lynne P. Pelos Vice President Vice President and Chief Administrative Officer, Winslow
Capital Management, Inc.
Gail L. Kummer Vice President Vice President and Trader, Winslow Capital Management,
Inc.
</TABLE>
Appendix A
MIMLIC Series Fund, Inc. PROXY
400 Robert Street North SPECIAL MEETING OF SHAREHOLDERS
St. Paul, Minnesota 55101-2098 APRIL 23, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned Shareholder of MIMLIC Series Fund, Inc. (the "Fund") of Saint
Paul, Minnesota, namely The Minnesota Mutual Life Insurance Company (herein
"Minnesota Mutual") hereby appoints Paul H. Gooding, Donald F. Gruber, and Eric
J. Bentley or any one of them as proxies, with full power of substitution and
revocation, to represent the undersigned and to cast all votes to which the
undersigned is entitled by virtue of being a Shareholder at the Special Meeting
of Shareholders of the Capital Appreciation Portfolio of the Fund to be held at
the principal office of the Fund, 400 Robert Street North, Saint Paul,
Minnesota, on April 23, 1996, at 10:30 A.M., and at any adjournment thereof,
with all powers the undersigned would possess if present in person. This proxy
shall be voted upon the matters specified and, in the discretion of the proxies,
upon all other matters as may properly come before the meeting.
1. To approve or disapprove the new Investment Sub-Advisory Agreement
between MIMLIC Asset Management Company and Winslow Capital Management,
Inc. with respect to investment sub-advisory services furnished on
behalf of the Fund's Capital Appreciation Portfolio.
Percentage of Shares to be Voted: FOR ___ AGAINST ___ ABSTAIN ___
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED AND AS DESCRIBED HEREIN. SHARES OF THE FUND HELD IN THE VARIABLE
LIFE ACCOUNT, THE VARIABLE ANNUITY ACCOUNT, THE VARIABLE FUND D, THE GROUP
VARIABLE ANNUITY ACCOUNT AND THE GROUP VARIABLE UNIVERSAL LIFE ACCOUNT (THE
"ACCOUNTS") WILL BE VOTED BY MINNESOTA MUTUAL AT THE REGULAR AND SPECIAL
MEETINGS OF THE FUND. SHARES WILL BE VOTED BY MINNESOTA MUTUAL IN ACCORDANCE
WITH INSTRUCTIONS RECEIVED FROM CONTRACT OWNERS WITH VOTING INTERESTS IN EACH
SUB-ACCOUNT OF THE ACCOUNTS. IN THE EVENT NO INSTRUCTIONS ARE RECEIVED FROM A
CONTRACT OWNER, WITH RESPECT TO SHARES OF A PORTFOLIO HELD BY A SUB-ACCOUNT,
MINNESOTA MUTUAL WILL VOTE SUCH SHARES OF THE PORTFOLIO AND SHARES NOT
ATTRIBUTABLE TO CONTRACTS IN THE SAME PROPORTION AS SHARES OF THE PORTFOLIO HELD
BY SUCH SUB-ACCOUNT FOR WHICH INSTRUCTIONS HAVE BEEN RECEIVED. THE NUMBER OF
VOTES WHICH ARE AVAILABLE TO A CONTRACT OWNER WILL BE CALCULATED SEPARATELY FOR
EACH SUB-ACCOUNT OF THE ACCOUNTS. IF, HOWEVER, THE INVESTMENT COMPANY ACT OF
1940 OR ANY REGULATION UNDER THAT ACT SHOULD CHANGE SO THAT MINNESOTA MUTUAL MAY
BE ALLOWED TO VOTE SHARES IN ITS OWN RIGHT, THEN IT MAY ELECT TO DO SO.
The undersigned hereby acknowledges receipt of the Notice to Shareholders of
Special Meeting and the Proxy Statement dated March 8, 1996, and revokes any
proxy heretofore given with respect to the votes covered by this proxy.
Date ___________________________, 1996
Signature ____________________________
Title _______________________________
Appendix B
THE MINNESOTA MUTUAL LIFE INSURANCE COMPANY
400 ROBERT STREET NORTH
ST. PAUL, MINNESOTA 55101-2098
This voting instruction form is solicited on behalf of the Board of
Directors.
Instructions for voting shares of MIMLIC Series Fund, Inc. (the "Fund") held
by The Minnesota Mutual Life Insurance Company ("Minnesota Mutual") at the
Special Meeting of Shareholders of the Capital Appreciation Portfolio of the
Fund on April 23, 1996.
Please check the appropriate box below, date this form and sign exactly as
your name appears below. Your signature acknowledges receipt of the Notice of
Special Meeting and Proxy Statement dated March 8, 1996. Shares will be voted
in accordance with these instructions at the special meeting or any
adjournment thereof.
Minnesota Mutual is instructed to vote as indicated below. IF NO CHOICE IS
INDICATED, RETURN OF THE SIGNED FORM SHALL BE CONSIDERED AS INSTRUCTIONS TO
VOTE FOR THE APPROVAL OF THE NEW INVESTMENT SUB-ADVISORY AGREEMENT BETWEEN
MIMLIC ASSET MANAGEMENT COMPANY AND WINSLOW CAPITAL MANAGEMENT, INC. If any
other matter properly comes before the meeting, Minnesota Mutual will vote in
accordance with its best judgment.
(to be signed and dated on other side)
(continued from other side)
1. The approval or disapproval of a new investment sub-advisory agreement,
relating to investment sub-advisory services furnished on behalf of the
Fund's Capital Appreciation Portfolio, between MIMLIC Asset Management
Company and Winslow Capital Management, Inc.
[ ] For [ ] Against [ ] Abstain
NOTE: PLEASE DATE THIS VOTING INSTRUCTION AND SIGN YOUR NAME IN THE EXACT
FORM AS IT APPEARS HEREIN AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
WHEN SIGNED AS "TRUSTEE" OR "EMPLOYER," PLEASE GIVE FULL TITLE AS SUCH.
_________________________________
SIGNATURE
DATE ______________________, 1996
