<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION
14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ X / Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
The HighMark Group
3435 Stelzer Road
Columbus, OH 43219
------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
Martin E. Lybecker, Esq.
Ropes & Gray, Suite 800 East
One Franklin Square
1301 K Street, N.W.
Washington, D.C. 20005
------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2).
/ / $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.
/ X / $125 per Item 22(a)(2) of Exchange Act Schedule 14A.
1) Title of each class of securities to which transaction applies: N/A
2) Aggregate number of securities to which transaction applies: N/A
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:* N/A
4) Proposed maximum aggregate value of transaction: N/A
* Set forth the amount on which the filing is calculated and state how
it was determined.
/ / 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: N/A
2) Form, Schedule or Registration Statement No.: N/A
3) Filing Party: N/A
4) Date Filed: N/A
Notes:
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THE HIGHMARK GROUP
Notice of Special Meeting of Shareholders
to be held March 11, 1996
A special meeting of the shareholders of The HighMark Group (the
"Group"), will be held at 9:00 a.m. at the offices of BISYS Fund Services,
Inc., 3435 Stelzer Road, Columbus, Ohio on March 11, 1996, for the following
purposes:
1. Agreements With The Investment Adviser.
To consider a new Investment Advisory Agreement and to ratify the
continuation of the Sub-Administration, Sub-Transfer Agency and Custodian
Agreements. This new Investment Advisory Agreement is required because the
pending merger of The Mitsubishi Bank, Limited and The Bank of Tokyo, Ltd. and
the related combination of their respective subsidiaries BanCal Tri-State
Corporation, The Bank of California, N.A. ("BOC"), and Union Bank may cause a
legal termination of the existing Investment Advisory Agreement between the
Group and BOC. There will be no change in the Group's investment objectives or
investment policies or in the duties of BOC, which will be renamed Union Bank
of California, N.A. ("UBOC"), as a result of the approval of the new Investment
Advisory Agreement. There will be no change in the fees payable by the Group
to UBOC as a result of approval of the new Investment Advisory Agreement. No
significant changes in the personnel of the investment adviser are currently
planned. The new Investment Advisory Agreement is contingent upon and will be
effective upon the consummation of the mergers and reorganization described
above.
2. Trustees.
To approve or disapprove the election of the Board of Trustees;
3. Independent Accountant.
To ratify the selection of Deloitte & Touche LLP as independent
accountants to the Group; and
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Trustees has fixed December 15, 1995 as the record date
for determination of shareholders entitled to vote at this meeting.
By Order of the Trustees
[Nancy E. Converse]
Secretary
January 22, 1996
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YOU CAN HELP AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP LETTERS TO
ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU ARE UNABLE TO
ATTEND THE MEETING, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY SO
THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE SPECIAL MEETING. THE
ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
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THE HIGHMARK GROUP
3435 STELZER ROAD
COLUMBUS, OHIO 43219
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of Trustees (the
"Trustees") of The HighMark Group (the "Group"). The proxy is revocable at any
time before it is voted by sending written notice of the revocation to the
Group or by appearing personally at the March 11, 1996 special meeting of
shareholders of the Group (the "Special Meeting"). The cost of preparing and
mailing the notice of meeting, the proxy card, this proxy statement and any
additional proxy material has been or is to be borne by
The Bank of California, N.A. ("BOC"), the Group's investment adviser. Proxy
solicitations will be made primarily by mail, but may also be made by
telephone, telegraph, fax or personal interview conducted by certain officers
or employees of the Group or of BISYS Fund Services Ohio, Inc. (the Group's
shareholder servicing agent) or BISYS Fund Services, Inc. (the Group's
administrator) or, if necessary, a commercial firm retained for this purpose.
In the event that the shareholder signs and returns the proxy ballot, but does
not indicate a choice as to any of the items on the proxy ballot, the proxy
attorneys will vote those shares in favor of such proposal(s).
Only shareholders of record at the close of business on December 15,
1995 will be entitled to vote at the Special Meeting. On December 15, 1995,
the Group had outstanding 1,140,915,397.019 shares of beneficial interest
("Shares"), each Share being entitled to one vote, and each fractional Share
being entitled to a proportionate fractional vote. On the same date, The
HighMark Growth Fund (the "Growth Fund") had outstanding 2,595,090.229 Shares,
The HighMark Income and Growth Fund (the "Income and Growth Fund") had
outstanding 479,994.486 Shares, The HighMark Income Equity Fund (the "Income
Equity Fund") had outstanding 17,462,477.287 Shares, The HighMark Balanced Fund
(the "Balanced Fund") had outstanding 2,825,192.229 Shares, the HighMark Bond
Fund (the "Bond Fund") had outstanding 5,907,507.298 Shares, The HighMark
Government Bond Fund (the "Government Bond Fund") had outstanding 481,669.770
Shares, The HighMark Diversified Obligations Fund (the " Diversified
Obligations Fund") had outstanding 378,403,466.350 Shares, The HighMark U.S.
Government Obligations Fund (the "U.S. Government Obligations Fund") had
outstanding 207,059,191.130 Shares, The HighMark 100% U.S. Treasury Obligations
Fund (the "100% U.S. Treasury Obligations Fund") had outstanding
312,663,648.070 Shares. The HighMark California Tax-Free Fund (the "California
Tax-Free Fund") had outstanding 170,482,455.440 Shares, the HighMark Tax-Free
Fund (the "Tax-Free Fund") had outstanding 42,554,704.730 Shares, The HighMark
Intermediate California Municipal Bond Fund (the "California Municipal Fund")
had outstanding 0 Shares and The HighMark Intermediate Municipal Bond Fund (the
"Municipal Fund") had outstanding 0 Shares.
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For purposes of determining the presence of a quorum and counting
votes on the matters presented, Shares represented by abstentions and "broker
non-votes" will be counted as present, but not as votes cast, at the Special
Meeting. Under the Investment Company Act of 1940 (the "1940 Act"), the
affirmative vote necessary to approve the matter under consideration may be
determined with reference to a percentage of votes present at the Special
Meeting, which would have the effect of treating abstentions and non-votes as
if they were votes against the proposal.
The Group's executive offices are located at 3435 Stelzer Road,
Columbus, Ohio 43219. This proxy statement and the enclosed notice of meeting
and proxy card are first being mailed on or about January 22, 1996.
A copy of the Group's Annual Report dated July 31, 1995 is available
upon request and may be obtained by calling 1-800-433-6884.
SUMMARY OF PROPOSALS
This Special Meeting is being called for the following purposes: (1)
to approve or disapprove a new investment advisory agreement between the Group
and BOC (the "New Investment Advisory Agreement"), and to ratify or reject
continuation of the following agreements to which BOC is also a party: the
Sub-Administration Agreement, the Sub-Transfer Agency Agreement and the
Custodian Agreement. The New Investment Advisory Agreement will be dated, and
the continuation of the other agreements will be effective upon the later of
(i) approval of the New Investment Advisory Agreement and ratification of the
continuation of the Sub-Administration Agreement, the Sub-Transfer Agency
Agreement and the Custodian Agreement by shareholders and Trustees of the Group
or (ii) the consummation of a series of merger and reorganization transactions
between BOC's ultimate parent, The Mitsubishi Bank, Limited ("MBL") and The
Bank of Tokyo, Ltd. ("BOT") and their respective California subsidiaries,
BanCal Tri-State Corporation ("Tri-State"), BOC and Union Bank ("Union"). As a
result of the Merger, BOC will be renamed Union Bank of California, N.A.
("UBOC"); (2) to approve or disapprove the election of the Board of Trustees;
(3) to ratify the selection of Deloitte & Touche LLP as independent accountants
to the Group; and (4) to transact such other business as may properly come
before the meeting or any adjournment thereof.
Approval of Proposal (1) with respect to any of the thirteen separate
investment funds of the Group (each a "Fund," or collectively, the "Funds")
requires the affirmative vote of: (a) 67% or more of the Shares of such Fund
present at the Special Meeting, if the holders of more than 50% of the
outstanding Shares are present or represented by proxy, or (b) more than 50% of
the outstanding Shares of such Fund, whichever is less.
Approval of Proposals (2) and (3) requires the affirmative vote of a
majority of the outstanding voting Shares (as defined in the 1940 Act) of the
Group.
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PROPOSAL (1)
APPROVAL OR DISAPPROVAL OF THE NEW
INVESTMENT ADVISORY AGREEMENT AND
RATIFICATION OR REJECTION OF THE
CONTINUATION OF THE SUB-ADMINISTRATION,
THE SUB-TRANSFER AGENCY
AND THE CUSTODIAN AGREEMENTS
THE NEW INVESTMENT ADVISORY AGREEMENT
Consideration of the New Investment Advisory Agreement is being
requested because of the pending merger of MBL and BOT and the related
combination of their subsidiaries, Tri-State, BOC and Union. The New
Investment Advisory Agreement between the Group and the combined California
bank, which will be renamed Union Bank of California, N.A. ("UBOC") would take
effect upon the later of (i) approval of the New Investment Advisory Agreement
by shareholders of the Group or (ii) the consummation of the Merger.
Here are some of the factors you should consider in determining
whether to approve the New Investment Advisory Agreement:
The Board of Trustees has unanimously approved the New Investment
Advisory Agreement;
There will be no change in the Group's investment objectives or
investment policies or in the duties of BOC as a result of
approval of the New Investment Advisory Agreement;
There will be no change in the fees payable by the Group to UBOC
for advisory services as a result of approval of the New
Investment Advisory Agreement; and
The Board of Trustees has been advised that UBOC management
currently intends that no significant changes in the persons
currently responsible for providing investment advice to the
Group will be made by UBOC following the consummation of the
Merger.
BOC, 400 California Street, Post Office Box 45000, San Francisco, CA
94104, serves as investment adviser to each Fund pursuant to an investment
advisory agreement dated May 8, 1992 (the "Present Investment Advisory
Agreement" ). Investment advisory and management services are provided to
each Fund of the Group by MERUS Capital Management ("MERUS"), a division of
BOC.
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Union, BOC and Tri-State, BOC's Delaware holding company, have signed
an Agreement and Plan of Reorganization, dated as of September 27, 1995 (the
"Reorganization Agreement"), a related Plan of Merger, dated as of September
27, 1995 (the "Merger Agreement") and a related Purchase and Assumption
Agreement (the "Purchase Agreement"), dated as of September 27, 1995 (the
Reorganization Agreement, the Merger Agreement and the Purchase Agreement are
collectively the "Merger Agreements"). See "Proposed Merger" below.
Consummation of the Merger will not alter the relationship between BOC and the
Group, and BOC will remain the entity responsible for providing investment
advisory services to the Group following the Merger. However, the Merger will
cause BOC to change its name to UBOC. To the extent the Merger might be deemed
to result in a change in ownership of BOC, the Present Investment Advisory
Agreement would automatically terminate in accordance with its terms as
required by the 1940 Act. Thus, approval of the New Investment Advisory
Agreement by shareholders of the Group is being sought in order to avoid any
interruption in the provision of advisory services to the Group.
On November 29, 1995, the Trustees, including a majority of the
Trustees who are not interested persons of the Group or BOC, as defined in the
1940 Act, approved the New Investment Advisory Agreement with UBOC, pursuant to
which UBOC will continue to act as the Group's investment adviser. THE TERMS
OF THE NEW INVESTMENT ADVISORY AGREEMENT ARE IDENTICAL TO THOSE OF THE PRESENT
INVESTMENT ADVISORY AGREEMENT WITH RESPECT TO DUTIES, FEES AND THE STANDARD OF
CARE. The effective date of the New Investment Advisory Agreement will be the
later of (i) approval by shareholders of the New Investment Advisory Agreement
or (ii) the date of the consummation of the Merger (the "Closing Date"). It is
currently expected that the Closing Date will occur on or about April 1, 1996.
UBOC will be headquartered at 350 California Street, San Francisco, California.
Copies of the Present Investment Advisory Agreement and the New
Investment Advisory Agreement appear as Exhibits A and B, respectively, to this
proxy statement.
The initial form of the Present Investment Advisory Agreement naming
BOC as investment adviser was approved by the Board of Trustees, including a
majority of the Trustees who are not interested persons of the Group or BOC, as
defined in the 1940 Act, on June 11, 1987 and was most recently reapproved, in
its current form dated May 8, 1992, on June 21, 1995. As required by the 1940
Act, such shareholder approval was obtained prior to the commencement of
operations of each Fund. The Present Investment Advisory contract was last
submitted to a vote of shareholders on January 9, 1992 for the purpose of
approval of changes in the term and the payment of brokerage commissions on
Fund portfolio transactions.
The terms of the New Investment Advisory Agreement (which are
materially unchanged from the Present Investment Advisory Agreement) provide
that UBOC, subject to the direction of the Board of Trustees, will provide a
continuous investment program for each Fund, including investment research and
management with respect to all securities and investments and cash equivalents
in said Funds. UBOC will determine from time to time what securities and other
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investments will be purchased, retained or sold by the Group with respect to
the Funds. For its services under the Present Investment Advisory Agreement,
BOC is entitled to receive an annual fee from each Fund of the lesser of:
(a)(i) for the U.S. Government Obligations, Diversified Obligations, 100% U.S.
Treasury Obligations, Tax-Free and California Tax -Free Funds, a fee computed
daily and paid monthly at the annual rate of forty one-hundredths of one
percent (.40%) of such Funds' first $500 million of average daily net assets,
thirty-five one-hundredths of one percent (.35%) of the next $500 million of
average daily net assets, and thirty one-hundredths of one percent (.30%) of
the remaining average daily net assets and (ii) for the Balanced, Growth,
Government, Income and Growth, Intermediate California, Intermediate Municipal,
Income Equity and Bond Funds, a fee computed daily and paid monthly at the
annual rate of one percent (1.00%) of such Funds' first $40 million of average
daily net assets and sixty one-hundredths of one percent (.60%) of the
remaining average daily net assets, or (b) such fee as may from time to time be
agreed upon in writing by the Group and BOC.
These fees are identical in amount to the fees to which each of the
Funds will be contractually subject under the New Investment Advisory
Agreement.
The Present Investment Advisory Agreement and the New Investment
Advisory Agreement each provides that BOC or UBOC, respectively, may, from time
to time and for such periods as it deems appropriate, further reduce its
compensation by voluntarily limiting the expenses of the Funds. During the
fiscal year ended July 31, 1995, BOC earned aggregate investment advisory fees
of $5,315,609 and waived an aggregate of $1,051,529. The California Municipal
Fund and the Municipal Fund had not yet commenced operations during the fiscal
year ended July 31, 1995.
For the fiscal year ended July 31, 1995, investment advisory fees
paid to, and voluntarily reduced by BOC, on a Fund by Fund basis, were as
follows:
<TABLE>
<CAPTION>
Investment Fees
Advisory Voluntarily
Fees Paid Reduced
---------------- --------------
<S> <C> <C>
Growth Fund $37,349 $158,716
Income and Growth Fund $0 $56,251
Income Equity Fund $1,419,062 $11,439
Balanced Fund $83,790 $168,408
Bond Fund $271,150 $250,310
Government Bond Fund $0 $46,447
</TABLE>
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<TABLE>
<CAPTION>
Investment Fees
Advisory Voluntarily
Fees Paid Reduced
---------------- --------------
<S> <C> <C>
Diversified Obligations Fund $1,429,494 $0
U.S. Government Obligations
Fund $729,094 $0
100% U.S. Treasury Obligations
Fund $920,611 $0
California Tax-Free Fund $267,095 $326,450
Tax-Free Fund $157,964 $33,508
</TABLE>
If approved by shareholders at this Special Meeting, the New
Investment Advisory Agreement will continue until July 31, 1996, unless
terminated, and may be renewed from year to year thereafter by the Board of
Trustees. The continuation of the New Investment Advisory Agreement must be
approved (a) by a majority vote of the Trustees, including a majority of the
Trustees who are not parties to the New Investment Advisory Agreement or
interested persons of the Group or BOC, as defined in the 1940 Act, cast in
person at a meeting called for that purpose and (b) by a vote of a majority of
the outstanding voting securities of a Fund. The New Investment Advisory
Agreement may be terminated as to a particular Fund at any time on sixty days'
written notice, without the payment of any penalty, by the Group (by vote of
the Group's Board of Trustees or by vote of a majority of the outstanding
voting securities of such Fund) or by UBOC. The New Investment Advisory
Agreement may not be assigned and shall terminate automatically in the event of
its assignment, as defined in the 1940 Act. The New Investment Advisory
Agreement provides that it may be amended only by an instrument in writing
signed by the party against which enforcement of the change is sought.
As does the Present Investment Advisory Agreement, the New Investment
Advisory Agreement provides that UBOC shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Funds in connection
with the performance of the New Investment Advisory Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of UBOC in the performance of its duties
or from reckless disregard by UBOC of its obligations and duties under the New
Investment Advisory Agreement.
The Trustees of the Group, including the Trustees who are not
interested persons of the Group or BOC as defined in the 1940 Act, reviewed and
unanimously approved the New Investment Advisory Agreement in person at a
meeting on November 29, 1995 and have directed that it be submitted to the
shareholders of the Group for their approval.
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If the New Investment Advisory Agreement is approved by shareholders
and the Merger is thereafter consummated, the New Investment Advisory Agreement
will be executed and become effective on the Closing Date. In the event the
Merger is not consummated, the Present Investment Advisory Agreement will
continue in accordance with its terms. In the event the Merger is consummated
and the New Investment Advisory Agreement is not approved, the Board of
Trustees will consider what further actions should be taken.
PROPOSED MERGER
The terms of the proposed merger provide that (i) MBL and BOT will
engage in a merger transaction in which MBL will be the surviving entity and
will change its name to The Bank of Tokyo-Mitsubishi, Ltd. ("BOTM"), and (ii)
as soon as practicable thereafter, the California bank subsidiaries of BOT and
MBL, Union and BOC, respectively, will combine to become Union Bank of
California, N.A.
The combination of the California banking subsidiaries of BOT and MBL
will be accomplished pursuant to (i) an Agreement and Plan of Reorganization
(the "Reorganization Agreement") among Union, BOC and Tri-State, (ii) an
Agreement and Plan of Merger (the "Merger Agreement"), pursuant to which
Tri-State will merge with and into Union, with Union being the surviving
corporation, and (iii) a Purchase and Assumption Agreement (the "Purchase
Agreement"), between Union and BOC pursuant to which Union will transfer
substantially all of its banking business and other assets to BOC in exchange
for BOC's assumption of substantially all of the liabilities of Union and the
issuance by BOC to Union of 26,117,714 shares of common stock, $15.00 par
value. In a practical sense, the transactions under the Reorganization
Agreement, the Merger Agreement and the Purchase Agreement will be effected as
a single, integrated transaction.
Following the transactions described above, BOC will be renamed Union
Bank of California, N.A., referred to herein as UBOC. UBOC will succeed by
operation of law to all rights, obligations, properties, assets, investments,
deposits, demands, and agreements covered by the Purchase Agreement, and to all
properties, assets, investments, agreements, rights, and obligations of Union
under all fiduciary or representative capacities (e.g., trusts and
executorships). After this transfer to UBOC of substantially all its banking
business, Union will voluntarily relinquish its California banking license and
its federal deposit insurance and will be strictly a bank holding company for
UBOC and its non-bank subsidiaries and will be renamed UnionBanCal Corporation
("UBCC")
Immediately following the combination of the California subsidiaries,
UBCC will own approximately 94% of the outstanding shares of Common Stock of
UBOC. BOTM will in turn own approximately 81% of the issued and outstanding
UBCC Common Stock. In addition to its indirect ownership of UBOC through its
ownership of 81% of UBCC Common Stock, BOTM will also own directly
approximately 6% of the common stock of UBOC. As a
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consequence, both UBCC and BOTM will be deemed to control UBOC for purposes of
the 1940 Act.
The Group has been advised that, after careful review and
consideration, the Group's Board of Trustees believes the Merger will provide
significant value to its shareholders and enable them to participate in the
expanded opportunities for growth that the Merger will make possible.
Consummation of the Merger is subject to the satisfaction of certain
conditions, including the receipt of all necessary regulatory approvals.
Approval of the Merger by the shareholders of Union and BOC is being solicited.
Shareholders of the Group are not being asked to vote on the Merger. The
Merger Agreements may be terminated and the Merger abandoned at any time prior
to the Closing Date by the mutual consent of the parties or upon the occurrence
of other events specified in the Merger Agreements. Completion of the Merger
will occur as soon as practicable after satisfaction or waiver of the
applicable conditions, which the parties anticipate will occur by April 1,
1996.
THE SUB-ADMINISTRATION AGREEMENT
BOC acts as sub-administrator for each of the Group's Funds pursuant
to the Sub-Administration Agreement between The Winsbury Company (now known as
BISYS Fund Services ("BISYS")) and BOC dated December 23, 1991. (A copy of the
Sub-Administration Agreement is attached hereto as Exhibit C.) At a meeting
held on November 29, 1995, the Group's Board of Trustees approved the
continuation of the Sub-Administration Agreement with UBOC. The
Sub-Administration Agreement was ratified by a majority of the outstanding
Shares of each Fund at a meeting of shareholders held on January 9, 1992. All
of the terms of the Sub-Administration Agreement will remain unchanged. The
Board of Trustees is seeking shareholder ratification of the Sub-Administration
Agreement at this time for advisory purposes only.
As Sub-administrator for each Fund, BOC assists BISYS in providing
such administrative services as may be reasonably requested by BISYS from time
to time. Such services may include clerical, bookkeeping, accounting,
stenographic and administrative services which will enable BISYS to more
efficiently perform its obligations under the Administration Agreement. Under
the Sub-Administration Agreement, BOC is entitled to receive a fee from BISYS
with respect to each Fund at an annual rate up to .05% of the Fund's average
daily net assets, plus BOC's related out-of-pocket expenses.
For the fiscal year ended July 31, 1995, sub-administration fees paid
to BOC were as follows:
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<TABLE>
<CAPTION>
Fees
Sub-Administration Voluntarily
Fees Paid Reduced
------------------ -----------
<S> <C> <C>
Growth Fund . . . . . . . . . . . . . . . . . . $ 5,204.48 $ 4,364.04
Income and Growth Fund . . . . . . . . . . . . $ 0.00 $ 2,525.54
Income Equity Fund . . . . . . . . . . . . . . $ 80,398.52 $ 30,315.53
Balanced Fund . . . . . . . . . . . . . . . . . $ 9,450.47 $ 3,650.86
Bond Fund . . . . . . . . . . . . . . . . . . . $ 22,939.79 $ 9,582.10
Government Bond Fund . . . . . . . . . . . . . $ 720.96 $ 2,160.91
Diversified Obligations Fund . . . . . . . . . $135,085.72 $ 51,240.93
U.S. Government Obligations Fund . . . . . . . $ 68,960.52 $ 26,190.11
100% U.S. Treasury Obligations Fund . . . . . . $ 87,050.63 $ 33,564.35
California Tax-Free Fund . . . . . . . . . . . $ 56,432.25 $ 21,114.70
Tax-Free Fund . . . . . . . . . . . . . . . . . $ 18,091.25 $ 6,699.56
</TABLE>
The Administration Agreement permits BISYS to subcontract its
services thereunder, provided that BISYS will not be relieved of its
obligations under the Administration Agreement by the appointment of a
subcontractor and BISYS shall be responsible to the Group for all acts of the
subcontractor as if such acts were its own, except for losses suffered by any
Fund resulting from willful misfeasance, bad faith, or gross negligence by the
subcontractor in the performance of its duties or for reckless disregard by it
of its obligations and duties.
The Sub-Administration Agreement provides that BOC will use its best
efforts to ensure the accuracy of all services performed under the Agreement
but that BOC will not be liable to the Group or BISYS for any action taken or
omitted by BOC in the absence of bad faith, willful misfeasance, or negligence
or for reckless disregard by it of its obligations and duties. BOC will assume
no responsibility under the Sub-Administration Agreement, and will not be
liable, for any damage, loss of data, delay or any other loss whatsoever caused
by events beyond its reasonable control. The Sub-Administration Agreement
further provides that BISYS will indemnify and hold harmless BOC, its
employees, agents, directors, officers, and nominees from and against any and
all claims, demands, actions, and suits, whether groundless or otherwise, and
from and against any and all judgments, liabilities, losses, damages, costs,
charges, counsel fees, and other expenses of every nature and character arising
out of or in any way relating to BOC's actions taken or nonactions with respect
to the performance of services under the Agreement with respect to a Fund or
based, if applicable, upon reasonable reliance on information, records,
instructions, or requests with respect to such Fund given or made to BOC by a
duly authorized representative of BISYS; provided that this indemnification
shall not apply to actions or omissions of BOC in cases of its own bad faith,
willful misfeasance, or negligence or reckless disregard by it of its
obligations and duties.
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The Sub-Administration Agreement will remain in effect until July 31,
1996 and will thereafter continue in effect as to a particular Fund for
successive periods of twelve months ending on July 31st of each year unless
written notice not to renew is given by the non-renewing party to the other
party at least 60 days prior to the expiration of the then-current term. The
Sub-Administration Agreement may be terminated during the initial term by
either party as to a particular Fund at any time on sixty days' written notice
to the other party.
THE SUB-TRANSFER AGENCY AGREEMENT
BOC acts as sub-transfer agent for each of the Group's Funds pursuant
to the Sub-Transfer Agency Agreement between The Winsbury Service Corporation
(now know as BISYS Fund Services Ohio, Inc. "(BISYS Ohio")) and BOC dated as of
February 22, 1989. (A copy of the Sub-Transfer Agency Agreement is attached
hereto as Exhibit D). At a meeting held on November 29, 1995, the Group's
Board of Trustees approved the continuation of the Sub-Transfer Agency
Agreement with UBOC. All of the terms of the Sub-Transfer Agency Agreement
will remain unchanged. The Sub-Transfer Agency Agreement was initially
approved by a majority of the outstanding Shares of each Fund at a meeting of
shareholders held on February 22, 1989, and was ratified by shareholders at a
meeting on January 9, 1992. The Board of Trustees is seeking shareholder
ratification of the Sub-Transfer Agency Agreement at this time for advisory
purposes only.
As sub-transfer agent, BOC performs sub-transfer agency services with
respect to investments in each of the Group's Funds through certain accounts
maintained with BOC and its affiliates. These services include the processing
of purchases and redemptions of Shares and the maintenance of shareholder
transfer and accounting records, such as the history of purchases, redemptions,
dividend distributions, and similar transactions in the shareholder's account.
For its services as sub-transfer agent, BISYS Ohio has agreed to pay
BOC with respect to the Group's Balanced Fund, Growth Fund, Income Equity Fund,
Bond Fund, Government Bond Fund, Income and Growth Fund, California Municipal
Fund and Municipal Fund an annual base fee of $12.00 per shareholder account
with respect to the first 101 through 2,999 shareholder accounts invested in a
Fund and an annual base fee of $9.00 per shareholder account with respect to
3,000 or more shareholder accounts invested in a Fund; BISYS Ohio has agreed to
pay BOC with respect to the Group's U.S. Government Obligations Fund,
Diversified Obligations Fund, 100% U.S. Treasury Obligations Fund, Tax-Free
Fund and California Tax-Free Fund an annual base fee of $15.00 per shareholder
account with respect to 101 or more shareholder accounts invested in the Fund.
(The number of shareholder accounts for purposes of determining the base fee is
calculated on a monthly basis and the base fee does not apply when 100 or less
shareholder accounts have been invested in a Fund.) BOC is also entitled to be
reimbursed by BISYS Ohio for postage, handling fees, and reasonable costs of
supplies used by BOC in the performance of its sub-transfer agency services.
12
<PAGE> 14
For the fiscal year ended July 31, 1995, sub-transfer agency fees
paid to BOC were as follows:
<TABLE>
<CAPTION>
Subtransfer
Agent
Fees Paid
------------
<S> <C>
Growth Fund . . . . . . . . . . . . . . . . . . $ 3,695.00
Income and Growth Fund . . . . . . . . . . . . . $0
Income Equity Fund . . . . . . . . . . . . . . . $31,292.00
Balanced Fund . . . . . . . . . . . . . . . . . $0
Bond Fund . . . . . . . . . . . . . . . . . . . $ 4,391.00
Government Bond Fund . . . . . . . . . . . . . . $0
Diversified Obligations Fund . . . . . . . . . . $ 4,911.00
U.S. Government Obligations Fund . . . . . . . . $0
100% U.S. Treasury Obligations Fund . . . . . . $ 526.25
California Tax-Free Fund . . . . . . . . . . . . $0
Tax-Free Fund . . . . . . . . . . . . . . . . . $0
</TABLE>
The Sub-Transfer Agency Agreement provides that it will continue in
effect unless terminated with respect to a particular Fund upon thirty days'
written notice by one party to the other party. The Agreement also provides
that BOC will use its best efforts to ensure the accuracy of all services
performed under the Sub-Transfer Agency Agreement, and that BISYS Ohio will
indemnify and hold harmless BOC, its employees, agents, directors, and officers
from and against any and all claims, demand, actions, and suits, whether
groundless or otherwise and from and against any and all judgments,
liabilities, losses, damages, costs, charges, counsel fees, and other expenses
of every nature and character arising out of or in any way relating to BOC's
actions taken or non-actions with respect to the performance of services under
the Agreement or based, if applicable, upon information, instructions, or
requests made to BOC by an officer or employee of BISYS Ohio; provided that
this indemnification does not apply to actions or omissions of BOC in cases of
its own bad faith, willful misconduct or gross negligence.
THE CUSTODIAN AGREEMENT
BOC acts as custodian for each of the Group's Funds pursuant to the
Custodian Agreement between BOC and the Group dated December 23, 1991. (A copy
of the Custodian Agreement is attached hereto as Exhibit E). At a meeting held
on November 29, 1995, the Group's Board of Trustees approved the continuation
of the Custodian Agreement with UBOC. As the Group's custodian, BOC's
responsibilities include safeguarding and controlling each Fund's cash and
securities, handling the receipt and delivery of each Fund's securities, and
collecting interest and dividends on each Fund's investments.
13
<PAGE> 15
The Custodian Agreement was approved by a majority of the outstanding
Shares of each of the Group's Funds at a meeting of shareholders held on
January 9, 1992. All of the terms of the Custodian Agreement will remain
unchanged. The Board of Trustees is seeking Shareholder ratification of the
Custodian Agreement at this time for advisory purposes only.
Under the Custodian Agreement, BOC is entitled to receive a custodian
fee from each Fund at an annual rate of .02% of the Fund's average daily net
assets, with an annual minimum fee of $2,500 per Fund. In addition, BOC is
entitled to charge each Fund transactional, holding and disbursement fees
involving each Fund's assets. BOC is entitled to be reimbursed by the Group
for reasonable out-of-pocket expenses incurred in connection with its duties
under the Custodian Agreement, and charges each Fund a flat fee for particular
types of transactions involving the receipt and delivery of the Fund's
securities.
For the fiscal year ended July 31, 1995, custodian fees paid to BOC
under the Custodian Agreement were as follows:
<TABLE>
<CAPTION>
Fees
Custodian Voluntarily
Fees Paid Reduced
--------- ---------------
<S> <C> <C>
Growth Fund . . . . . . . . . . $0 $34,541
Income and Growth Fund . . . . . $0 $25,817
Income Equity Fund . . . . . . . $ 76,450 $0
Balanced Fund . . . . . . . . . $0 $28,297
Bond Fund . . . . . . . . . . . $ 37,760 $0
Government Bond Fund . . . . . . $0 $14,584
Diversified Obligations Fund . . $ 111,937 $0
U.S. Government Obligations Fund. $ 78,529 $0
100% U.S. Treasury Obligations
Fund . . . . . . . . . . . . . $ 56,901 $0
California Tax-Free Fund . . . . $ 58,008 $0
Tax-Free Fund . . . . . . . . . $ 38,800 $0
</TABLE>
The Custodian Agreement will remain in effect until July 31, 1996 and
will thereafter continue in effect as to a particular Fund for successive
periods of twelve-months ending on July 31st of each year, provided that such
continuation is specifically approved at least annually by the Group's Board of
Trustees or by vote of the outstanding Shares of the Fund and, in either case,
by a majority of the Trustees who are not interested persons (as defined in the
1940 Act) of any party to the Custodian Agreement. The Custodian Agreement is
terminable at any time as to a particular Fund without penalty by the Trustees,
by a majority of the outstanding Shares of that Fund or by either party upon
sixty days' written notice to the other party. The Custodian Agreement also
provides that BOC will exercise reasonable care in carrying out the provisions
of the Custodian Agreement but that BOC will be liable only for its own
negligence or bad faith acts or failures to act. Under the Custodian
Agreement, each Fund will indemnify BOC and hold it harmless from and against
all claims, liabilities, and expenses
14
<PAGE> 16
(including attorneys' fees) with respect to such Fund which BOC may suffer or
incur on account of acting as the custodian under the Agreement except such
claims, liabilities, and expenses arising from BOC's own negligence or bad
faith.
TRUSTEES' RECOMMENDATIONS AND OTHER INFORMATION
The New Investment Advisory Agreement and the continuation of the
Sub-Administration Agreement, the Sub-Transfer Agency Agreement and the
Custodian Agreement were approved by the Board of Trustees of the Group,
including a majority of the Trustees who are not interested persons of the
Group as defined in the 1940 Act, at a meeting held on November 29, 1995.
THE TRUSTEES RECOMMEND THAT THE SHAREHOLDERS OF THE GROUP VOTE FOR
THE PROPOSED NEW INVESTMENT ADVISORY AGREEMENT. Unlike the New Investment
Advisory Agreement, which must be approved by shareholders in order to avoid
any interruption in the provision of advisory services to the Group, as
explained above under the heading "The New Investment Advisory Agreement," the
Sub-Administration Agreement, the Sub-Transfer Agency Agreement and the
Custodian Agreement are being presented to shareholders for ratification at
this time for advisory purposes only, and the Trustees also recommend that
shareholders of the Group vote FOR ratification of these Agreements.
In making these recommendations, the Trustees have considered
information relating to UBOC status following the completion of the Merger,
including present capabilities and expertise in serving as investment adviser,
sub-administrator, sub-transfer agent and custodian to the Group. They have
reviewed the terms of each Agreement, including the fact that no effective net
change to the Group's investment advisory, sub-administration, sub-transfer
agent or custodian fees is being proposed. The Trustees have also considered
the fact that UBOC would continue to be familiar with the Group and their
shareholder base.
Pursuant to the Present Investment Advisory Agreement, MERUS
determines, subject to the general supervision of the Board of Trustees of the
Group and in accordance with each Fund's investment objective and restrictions,
which securities are to be purchased and sold by a Fund, and which brokers are
to be eligible to execute its portfolio transactions. While MERUS generally
seeks competitive spreads or commissions on behalf of each of the Funds, the
Group may not necessarily pay the lowest spread or commission available on each
transaction. Allocation of transactions to various dealers is determined by
MERUS in its best judgment and in a manner deemed fair and reasonable to
Shareholders. The primary consideration is prompt execution of orders in an
effective manner at the most favorable price. Subject to this consideration,
dealers who provide supplemental investment research to MERUS may receive
orders for transactions by the Group. Information so received is in addition
to and not in lieu of services required to be performed by MERUS and does not
reduce the advisory fees payable to BOC by the Group. Such information may be
useful to MERUS in serving both the Group and other clients and, conversely,
supplemental information obtained by the placement of business of other clients
may be useful to MERUS in carrying out its obligations to the Group.
15
<PAGE> 17
In connection with their recommendations to shareholders to vote for
the Agreements, the Trustees were advised by BOC that no significant changes in
the persons currently responsible for providing investment advice to the Group
are currently planned to be made by UBOC following consummation of the merger.
BOC also advised the Trustees that it intends to examine all mutual fund
activities of the combined entities subsequent to consummation of the Merger,
and that management of the Group would be involved in the examination of these
activities. Accordingly, BOC has advised the Trustees that it is unable to
predict whether changes will be recommended which would materially impact the
Group's operations or when such changes, if recommended, would be proposed.
Nevertheless, the Trustees, including all members of the Board of Trustees who
are not interested persons of the Group, BOC, or UBOC concluded that UBOC will
be fully capable of performing the services contemplated by the New Investment
Advisory Agreement, the Sub-Administration Agreement, the Sub-Transfer Agency
Agreement and the Custodian Agreement and recommended that the New Investment
Advisory Agreement be approved by the shareholders of the Group, and that the
continuation of the Sub-Administration Agreement, the Sub-Transfer Agency
Agreement and the Custodian Agreement be ratified by shareholders of the Group.
In regard to the New Investment Advisory Agreement, the 1940 Act
provides that, in connection with the sale of any interest in an investment
adviser which results in the "assignment" of an investment advisory contract,
an investment adviser of a registered investment company, or an affiliated
person of such investment adviser, may receive any amount or benefit if (i) for
a period of three years after the sale, at least 75% of the members of the
Board of Trustees of the investment company are not interested persons of the
investment adviser or the predecessor adviser, and (ii) there is no "unfair
burden" imposed on the investment company as a result of such sale or any
express or implied terms, conditions or understanding applicable thereto. For
this purpose, "unfair burden" is defined to include any arrangement during the
two-year period after the transaction, whereby the investment adviser or its
predecessor or successor investment advisers, or any interested persons of any
such adviser, receives or is entitled to receive any compensation directly or
indirectly (i) from any person in connection with the purchase or sale of
securities or other property to, from or on behalf of the investment company
other than bona fide ordinary compensation as principal underwriter for such
company, or (ii) from the investment company or its security holders for other
than bona fide investment advisory or other services. This provision of the
1940 Act was enacted by Congress in 1975 to make it clear that an investment
adviser (or an affiliated person of the adviser) can realize a profit on the
sale of the adviser's business subject to the two safeguards described above.
The majority of the members of the Board of Trustees of the Group is not and
will not be comprised of interested persons of BOC or UBOC. (See Proposal (2)
below, identifying the interested Trustees of the Group.) Additionally, the
Board of Trustees of the Group has received assurance from BOC that no "unfair
burden" will be imposed on the Group as a result of the proposed transaction.
THE BOARD OF TRUSTEES OF THE GROUP RECOMMENDS THAT THE SHAREHOLDERS
APPROVE THE NEW INVESTMENT ADVISORY AGREEMENT AND THAT SHAREHOLDERS RATIFY THE
CONTINUATION OF THE SUB-ADMINISTRATION AGREEMENT, THE SUB-TRANSFER AGENCY
AGREEMENT AND THE CUSTODIAN AGREEMENT.
16
<PAGE> 18
PROPOSAL (2)
ELECTION OF BOARD OF TRUSTEES
At the Special Meeting, shareholders of the Group will be asked to
elect five Trustees to the Board of Trustees, one of whom, Frederick J. Long,
is a new nominee who has been serving as a Trustee to date by appointment by
the other members of the Board. The current Board of Trustees of the Group,
including a majority of the Trustees who are not interested persons, as defined
in the 1940 Act, has selected and proposed for election the nominees listed
below. Each trustee who is elected will hold office until the next meeting of
shareholders of the Group and until such trustee's successor shall have been
elected and shall have qualified, or until such trustee's term is terminated as
provided in the Group's Declaration of Trust and By-laws. The Group is a
Massachusetts business trust, and is therefore not required to hold annual
meetings of shareholders. Consequently, the trustees who are elected at the
Special Meeting could serve for extended periods of time without shareholder
approval.
If the nominees withdraw from election or are otherwise unavailable
to serve as Trustee, the proxies will be voted for such other persons as the
Board of Trustees may choose, or the size of the Board of Trustees may be
reduced as necessary pursuant to the Group's Declaration of Trust and By-laws.
The nominees listed below have consented to being named in this Proxy Statement
and to serve if elected. The table below sets forth certain information about
the nominees.
<TABLE>
<CAPTION>
TRUSTEE BUSINESS EXPERIENCE DURING
NAME SINCE PAST FIVE YEARS AGE
<S> <C> <C> <C>
Thomas L. Braje 1987 Vice President and Chief Financial 52
1000 Alfred Nobel Drive Officer of Bio Rad Laboratories,
Hercules, CA 94547 Inc.
David A. Goldfarb 1987 Partner, Goldfarb & Simens, 53
111 Pine Street Certified Public Accountants
18th Floor
San Francisco, CA 94111
Joseph C. Jaeger 1987 Senior Vice President and 60
100 First Street Chief Financial Officer,
San Francisco, CA 94105 Delta Dental Plan of California
Frederick J. Long 1993 President and Chief Executive 60
520 Pike Street Officer, Acordia Northwest, Inc.,
20th Floor Acordia/Pettit-Morry Company
Seattle, WA 98101 (insurance brokerage)
</TABLE>
17
<PAGE> 19
<TABLE>
<S> <C> <C> <C>
Stephen G. Mintos* 1987 Employee, and prior to 41
3435 Stelzer Road October 1993, a limited partner
Columbus, OH 43219 of BISYS Fund Services
</TABLE>
- --------------
* Indicates an "interested person" of the Group as defined in the
Investment Company Act of 1940. Mr. Mintos is an interested person
of the Group because he is an employee of BISYS Fund Services, Inc.,
the Group's administrator and distributor.
(1) Mr. Mintos also serves as a Trustee of the following registered
investment companies: The Parkstone Group of Funds, The Pacific
Capital Funds and The Riverfront Funds.
The disinterested Trustees received a quarterly fee of $750 for
services as trustee and $1,500 for each meeting of the Board attended, and were
also reimbursed for expenses incurred in connection with attendance at meetings
of the Board of Trustees. The Trustees, if elected, will continue to receive
the same fees as enumerated above. For the fiscal period ended July 31, 1995,
the disinterested Trustees received fees aggregating $42,000.
During the fiscal year ended July 31, 1995, there were five meetings
of the Board of Trustees. Each Trustee attended at least 75% of the meetings.
There are no committees of the Board of Trustees. As of November 17, 1995, the
trustees and officers of the Group owned beneficially less than 1% of the
outstanding Shares of the Group and of each Fund.
For the disinterested Trustees, the following table sets forth
information concerning fees paid and retirement benefits accrued during the
fiscal year ended July 31, 1995:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
(1) (2) (3) (4) (5)
NAME OF AGGREGATE PENSION OR ESTIMATED TOTAL
TRUSTEE COMPENSATION RETIREMENT ANNUAL COMPENSATION
FROM GROUP BENEFITS BENEFITS FROM FUND
ACCRUED AS UPON COMPLEX PAID
PART OF RETIREMENT TO TRUSTEES
FUND
EXPENSES
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Thomas J. Braje $10,500 None None $10,500
- ---------------------------------------------------------------------------
David A. Goldfarb $10,500 None None $10,500
- ---------------------------------------------------------------------------
Joseph C. Jaeger $10,500 None None $10,500
- ---------------------------------------------------------------------------
Frederick J. Long $10,500 None None $10,500
- ---------------------------------------------------------------------------
</TABLE>
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE TO ELECT EACH
NOMINEE TO THE BOARD OF TRUSTEES.
18
<PAGE> 20
INFORMATION ABOUT MBL, TRI-STATE AND BOC
MBL, with 52.71 trillion yen in assets and a 115-year history, is one
of the world's leading commercial banks. In Japan, MBL provides a broad range
of financial services to consumers and corporations. These services are made
available through a network of 346 banking offices located primarily in the
Tokyo and Osaka regions. MBL is also very active overseas. The Mitsubishi
Bank Group, an international network of 72 branches, offices, and subsidiaries
in 27 countries, serves its Japanese and foreign clientele in such areas as
corporate banking, project finance, trade finance, and treasury and foreign
exchange. The Mitsubishi Bank Group is engaged in a variety of investment
banking activities in the world's principal capital markets. These activities
include bond underwriting and dealing, developing financial derivative
products, and providing M&A and other financial advisory services. MBL is one
of Japan's most widely traded and broadly owned corporations, with 46,994
registered shareholders as of March 31, 1995. Its shares are listed in Japan
on the Tokyo, Osaka, Kyoto, and Sapporo stock exchanges and overseas on the New
York, London, Paris, Zurich, Geneva, and Basel stock exchanges.
Tri-State is a registered bank holding company incorporated under the
laws of Delaware, which conducts banking business primarily through its
principal subsidiary, BOC, a national banking association. MBL owns 100% of
the outstanding shares of Tri-State and 17% of the outstanding shares of BOC
Common Stock. Tri-State owns the remaining 83% of the outstanding shares of
BOC Common Stock. As BOC and its subsidiaries represented more than 99% of
Tri-State's total assets and total revenues at June 30, 1995, the following
business discussion focuses on BOC and its subsidiaries.
BOC has operated in California since 1864. With total assets of
approximately $7.9 billion as of September 30, 1995, BOC offers full banking
and fiduciary services and was ranked as the sixth largest bank in California
in terms of total assets as of that date. At September 30, 1995, BOC
maintained 46 banking offices in California, Oregon and Washington and six
branches and six representative offices in foreign countries and an
international banking subsidiary in New York.
BOC offers a variety of credit products, including commercial, real
estate, installment, accounts receivable, inventory and agricultural loans, and
loans to financial institutions and public entities of all sizes. In addition,
BOC provides depository and non-credit services such as checking, cash
management, personal and business (employee benefit) trust, investment,
financial advisory and automated business services to its commercial customers.
Most of BOC's domestic business activity is with customers in California,
Oregon and Washington. Substantially all of BOC's real estate construction and
mortgage loans are secured by property located in these states.
BOC also provides consumer banking services through its branch
system, primarily consisting of checking and savings accounts, money market
accounts, personal and residential loans, MasterCard(R) and Visa(R) , safe
deposit facilities and other related financial services.
19
<PAGE> 21
BOC has been involved in international operations since its
inception. BOC extends credit to foreign central and commercial banks, foreign
governments and their agencies and domestic and foreign corporations engaged in
international business. In addition, BOC is active in the financing of foreign
trade. BOC places deposits with and receives deposits from domestic and
foreign banks which operate in the Eurocurrency market and receives deposits at
its foreign branches from foreign and domestic customers. Non-credit
international services also are provided, including correspondent banking and
funds transfer services. Most of BOC's foreign business activity is with
customers in Asia.
BOC provides trust services in California, Oregon and Washington.
BOC's principal trust offices are located in San Francisco, Los Angeles,
Portland, Seattle and Tacoma. Personal trust services include trust
administration, probate administration, and investment advisory, agency and
custody services. Employee benefit trust services include trust administration
and custody and investment advisory services relating to corporate retirement
plans, individual retirement accounts, Keogh plans and other retirement or
health and welfare plans.
BOC, both directly and through its NASD registered broker-dealer
subsidiary, BankCal Investment Services, Inc., provides a broad range of
investment products. Through its staff located in San Francisco, Los Angeles,
Portland and Seattle, BOC provides fixed income securities, money market
instruments, mutual funds, annuities and equity securities to BOC's corporate,
public entity, financial institution and individual customers.
BOC also serves as investment advisor to the Equity Income Portfolio
and as investment sub-advisor to the Large Cap Value Portfolio of the SEI
Institutional Managed Trust. BOC may reduce its fee, in its descretion. As of
September 30, 1995, the assets and advisory or sub-advisory fees, as
applicable, of these funds were as follows:
Asset Value Ratio of Advisory
----------- Fee to Net Assets
-----------------
Equity Income Portfolio $250,609,000.00 0.25%
Large Cap Value Portfolio $331,592,000.00 0.20%
Tri-State's and BOC's principal executive offices are located at 400
California Street, San Francisco, CA 94104; telephone number (415) 765-0400.
INFORMATION ABOUT BOT AND UNION
The Bank of Tokyo Group is one of Japan's premier international
financial institution. Founded in 1946 as successor to the Yokohama Specie
Bank, which was established in 1880, BOT has been the most prominent force in
Japan's foreign exchange market. In addition to foreign exchange, BOT offers
an array of services to its internationally oriented clients in such fields as
corporate finance, global service banking, investment advisory services and
project finance. These services are carried out through a network of
approximately 400 international offices, subsidiaries, sub-branches and
associated institutions. BOT has 26.78 trillion yen in assets.
Union is a California banking corporation formed in 1952. Union is
the fourth largest commercial bank in California, with $19 billion in assets at
September 30, 1995, and the [THIRTIETH] largest commercial bank nationally,
based on deposits at such date. BOT owned approximately 71.54 percent of the
issued and outstanding Union Common Stock at September 30, 1995.
Union has 209 offices throughout California, primarily centered in
the San Diego, Los Angeles, Orange County and San Francisco metropolitan areas.
It also has licensed loan production offices for either commercial, consumer or
residential loans in five California cities and Dallas, Texas. It has four
20
<PAGE> 22
overseas banking offices located in Guam (2), Saipan and Grand Cayman, a
representative office in Tokyo, Japan and International Banking Facilities in
San Francisco and Los Angeles.
Union provides a wide range of financial services, including trust
and investment management services, to California consumers, small businesses,
middle market companies and major corporations, and has a strong position in
providing financial services for growing Pacific Rim companies in California
through its affiliation with BOT's Pacific Rim network. Union maintains
relationships with a significant number of the Japanese-owned businesses in
California, and assists U.S. companies in establishing businesses in Japan and
other Pacific Rim countries.
Union serves consumers, smaller businesses, and government and
nonprofit institutions through its 209 offices in California. It has seven
commercial banking offices in the state through which extensive services are
provided to California's corporate middle market, such as lines of credit,
accounts receivable and inventory financing, foreign trade financing and an
array of cash-management services. Union considers its principal market for
this segment of Union to be businesses with sales between $20 million and $200
million. Union lends statewide to the California real estate market primarily
through the three geographic regions of its real estate industries area. Union
also provides specialized lending services to corporate customers, a variety of
banking services in the institutional and deposit markets, and asset management
services for individuals and businesses. Union has twelve subsidiaries that
provide various types of services to Union and its customers.
Union's principal executive offices are located at 350 California
Street, San Francisco, California 94104; telephone number (415) 445-0442.
OFFICERS AND DIRECTORS
The principal executive officers and directors of UBOC will be:
<TABLE>
<CAPTION>
NAME PROPOSED POSITION PRINCIPAL
---- ------------------ ---------
WITH UBOC OCCUPATION
--------- ----------
<S> <C> <C>
Alexander D. Calhoun Director. A director Of Counsel, Graham
of Union & James, Attorneys
since 1968. at Law, since
1992. General
Partner, 3638
Washington
Associates.
Richard D. Farman Director. A director President, Chief
of Union Operating Officer
since 1988. and Director of
Pacific
Enterprises since
1993. Former
Chief Executive
Officer Southern
California Gas
Company, a
subsidiary of
Pacific
Enterprises.
</TABLE>
21
<PAGE> 23
<TABLE>
<CAPTION>
NAME PROPOSED POSITION PRINCIPAL
---- ------------------ ---------
WITH UBOC OCCUPATION
--------- ----------
<S> <C> <C>
Stanley F. Farrar Director. A director Partner, Sullivan
of BOC & Cromwell since
since 1984. 1984.
Herman E. Gallegos Director. A director Independent
of Union management
since 1988. consultant since
1982. Former U.S.
Public Delegate to
the 49th United
Nations General
Assembly.
Chairman of the
Board, Gallegos
Institutional
Investors
Corporation
(retired).
Director of
Pacific Telesis
Group and Pacific
Bell.
Jack L. Hancock Director. A director Executive Vice
of Union President of
since 1994. Pacific Bell
(retired).
Director of
Whittaker
Corporation.
Richard C. Hartnack Vice Chairman of the Former Executive
Board of UBOC. Vice Vice President of
Chairman of the Union The First National
Board since 1991. Bank of Chicago.
</TABLE>
22
<PAGE> 24
<TABLE>
<CAPTION>
NAME PROPOSED POSITION PRINCIPAL
---- ------------------ ---------
WITH UBOC OCCUPATION
--------- ----------
<S> <C> <C>
Roy A. Henderson Vice Chairman of the Chairman of
Board LoPresti Flight
of UBOC. A director Concepts. Former
of BOC President and
since 1993. Chief Operating
Officer of Puget
Sound Bank.
Harry W. Low Director. A director Mediator/Arbitrator,
of Union Judicial
since 1993. Arbitration &
Mediation
Services, Inc.
since 1992.
Presiding Justice,
State of
California Court
of Appeals, 1st
District
(retired).
Mary S. Metz Director. A director Dean of University
of Union Extension,
since 1988. University of
California,
Berkeley since
1991. President
Emerita of Mills
College. Director
of Pacific Telesis
Group, Pacific Gas
& Electric Co. and
Longs Drugs
Stores.
Raymond E. Miles Director. A director Professor, Haas
of BOC School of
since 1987. Business,
University of
California,
Berkeley since
1963.
J. Fernando Niebla Director. A director Chairman and Chief
of BOC Executive Officer
since 1994. of Infotec
Development, Inc.
since 1979.
</TABLE>
23
<PAGE> 25
<TABLE>
<CAPTION>
NAME PROPOSED POSITION PRINCIPAL
---- ------------------ ---------
WITH UBOC OCCUPATION
--------- ----------
<S> <C> <C>
Hiroo Nozawa Deputy Chairman of Chairman,
the Board President and
and Chief Operating Chief Executive
Officer of UBOC. Officer of BOC
Chairman, President since 1994. A
and Chief Executive director of MBL
Officer of BOC since since 1992 and of
1994. A director of BOC since 1994.
MBL since 1992 and of Former Senior
BOC since Officer of
1994. Former Senior Mitsubishi.
Officer of
Mitsubishi.
Sidney R. Peterson Director. A director Consultant and
of Union private investor
since 1988. since 1984.
Chairman and Chief
Executive Officer
of Getty Oil
Company (retired).
Director of Avery
Dennison
Corporation,
NICOR, Inc.,
Global Natural
Resources, Inc.
and Group
Technologies
Corporation.
Carl W. Robertson Director. A director Managing Director
of BOC of Warland
since 1975. Investments
Company since
1985.
Charles R. Scott Director. A director Chairman and Chief
of BOC Executive Officer
since 1990. of Leadership
Centers USA since
1995. Former
President and
Chief Executive
Officer of The
Actava Group and
Intermark Inc.
Vice Chairman and
Director of Pier I
Imports, Inc.
Paul W. Steere Director. A director Member, Bogle &
of BOC Gates, P.L.L.C.
since 1981. since 1966.
Director of
Accordia
Northwest, Inc., a
subsidiary of
Accordia, Inc.
</TABLE>
24
<PAGE> 26
<TABLE>
<CAPTION>
NAME PROPOSED POSITION PRINCIPAL
---- ------------------ ---------
WITH UBOC OCCUPATION
--------- ----------
<S> <C> <C>
Henry T. Swigert Director. A director Chairman of ESCO
of BOC Corporation since
since 1989. 1979.
Robert M. Walker Vice Chairman of the Former Vice
Board of UBOC. Vice Chairman of the
Chairman of the Union Board and Chief
Board since 1992. Credit Officer of
Valley National
Bank of Arizona.
Blenda J. Wilson Director. A director President of
of Union California State
since 1993. University,
Northridge since
1992. Former
Chancellor of the
University of
Michigan -
Dearborn.
Kanetaka Yoshida President and Chief President and
Executive Officer and Chief Executive
Director of UBOC. Officer of Union
President and Chief since 1993. A
Executive Officer of director of both
Union since 1993. A Union and BOT
director of both since 1990.
Union and BOT since Former Vice
1990. Former Vice Chairman of the
Chairman of the Union Union Board and
Board Chief Financial
and Chief Financial Officer of Union.
Officer of Union. Former Senior
Former Senior Officer Officer of BOT.
of BOT.
</TABLE>
PROPOSAL (3)
RATIFICATION OF SELECTION OF
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
At the Special Meeting, the Group's shareholders will be asked to
ratify the Board of Trustees' selection of Deloitte & Touche LLP as the Group's
independent certified public accountants for the fiscal year ended July 31,
1996. On September 20, 1995, a majority of the Group's Board of Trustees who
are not interested persons (as defined in the 1940 Act) of the Group voted to
select Deloitte & Touche LLP to replace Coopers & Lybrand LLP who had served as
the Group's independent public accountants since June 11, 1987. Deloitte &
Touche LLP has informed the Group that it has no direct or material indirect
financial interest in the Group. A representative of Deloitte & Touche LLP is
expected to be available at the Meeting in person or telephonically to make a
statement if he or she desires to do so and to respond to appropriate
questions.
25
<PAGE> 27
The Board of Trustees recommends that shareholders vote to ratify the
selection of Deloitte & Touche LLP as the Group's independent accountants for
the fiscal year ending July 31, 1996.
AFFILIATED BROKER TRANSACTIONS
In the fiscal year ended July 31, 1995, no brokerage commissions were
paid to affiliated brokers of the Group or of BOC on account of trading for the
Funds.
OTHER MATTERS AND DISCRETION
OF PERSONS NAMED IN THE PROXY
While the Special Meeting is called to act upon any other business
that may properly come before it, at the date of this proxy statement the only
business which the management intends to present or knows that others will
present is the business stated in the Notice of Meeting. If any other matters
lawfully come before the Special Meeting, and in all procedural matters at said
Special meeting, it is the intention that the enclosed proxy shall be voted in
accordance with the best judgment of the persons named as proxies therein, or
their substitutes, present and acting at the Special Meeting.
If at the time any session of the Special Meeting is called to order,
a quorum is not present, in person or by proxy, the persons named as proxies
may vote those proxies that have been received to adjourn the Special Meeting
to a later date. In the event that a quorum is present but sufficient votes in
favor of one or more of the proposals have not been received, the persons named
as proxies may propose one or more adjournments of the Special Meeting to
permit further solicitation of proxies with respect to any such proposal. All
such adjournments will require the affirmative vote of a majority of the Shares
present in person or by proxy at the session of the Special Meeting to be
adjourned. The persons named as proxies will vote those proxies that they are
entitled to vote in favor of the proposal, in favor of such an adjournment, and
will vote those proxies required to be voted against the proposal, against any
such adjournment. A vote may be taken on one or more of the proposals in this
proxy statement prior to any such adjournment if sufficient votes for its or
their approval have been received and it is otherwise appropriate.
As of November 17, 1995, the Group believes that BOC was the
shareholder of record of 30.65% of the Investor Shares and 97.65% of the
Fiduciary Shares of the Growth Fund, 25.58% of the Investor Shares and 97.55%
of the Fiduciary Shares of the Income and Growth Fund, 29.04% of the Investor
Shares and 95.03% of the Fiduciary Shares of the Income Equity Fund, 8.19% of
the Investor Shares and 98.60% of the Fiduciary Shares of the Balanced Fund,
67.81% of the Investor Shares and 94.51% of the Fiduciary Shares of the Bond
Fund, 84.28% of the Fiduciary Shares of the Government Bond Fund, 97.97% of the
Fiduciary Shares of the Tax-Free Fund, and substantially all of the Fiduciary
Shares of the U.S. Government Obligations Fund, the Diversified Obligations
Fund, the 100% U.S. Treasury Obligations Fund and the California Tax-Free Fund.
There were no shareholders of the California Municipal Fund and the Municipal
Fund as of November 17, 1995. As of November 17, 1995, the Group believes that
BOC had voting power with respect to 60.61% of the Growth Fund Fiduciary
Shares, 42.96% of the Income Equity Fund Fiduciary Shares, 41.09% of the
Balanced Fund Fiduciary
26
<PAGE> 28
Shares, 46.20% of the Bond Fund Fiduciary Shares, 13.88% of the Government Bond
Fund Fiduciary Shares, 15.80% of the Diversified Obligations Fund Fiduciary
Shares, 6.87% of the U.S. Government Obligations Fund Fiduciary Shares, 22.84%
of the 100% U.S. Treasury Fund Fiduciary Shares, 17.90 % of the California
Tax-Free Fund Fiduciary Shares, 44.87% of the Tax-Free Fund Fiduciary Shares
and 7.94% of the Income and Growth Fund Fiduciary Shares. As a result, BOC may
be deemed to be a "controlling person" of each of the Funds under the 1940 Act.
The following list indicates the beneficial ownership of the
shareholders who, to the best knowledge of the Group, are the beneficial owners
of more than 5% of the outstanding Shares of the Group as of November 17, 1995:
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
GROWTH FUND INVESTOR SHARES
---------------------------
Richard Ormsby 5.31%
13004 Abra Rd.
San Diego, CA 92128
John A. Dito 11.00%
650 South Hope St. #2800
Los Angeles, CA 92621
FIDUCIARY SHARES
----------------
The Bank of California, N.A. 32.28%
Capital Accumulation Plan
400 California St.
San Francisco, CA 94104
The Bank of California N.A. 18.14%
Personal Retirement Option Plan
400 California St.
San Francisco, CA 94104
</TABLE>
27
<PAGE> 29
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
INCOME AND GROWTH FUND
----------------------
INVESTOR SHARES
---------------
Sharon K. Clark 7.94%
29036 Miller Rd.
Valley Center, CA 92082
FIDUCIARY SHARES
----------------
Control Master Products Inc. PS 9.05%
1065 Shary Circle
Concord, CA 94518
United Alloys Inc. Profit Sharing Plan 7.36%
900 East Slauson Ave.
Los Angeles, CA 90011
Dick's Towing & Road Service 6.57%
2012 South 146th Street
Seattle, WA 98168
Newport Adhesive & Composites Inc. 5.93%
Qualified Retirement Plan
1822 Reynolds Ave.
Irvine, CA 92714
Decker Communications Inc. 401(k) Plan 12.47%
44 Montgomery, 17th Floor
San Francisco, CA 94104
Economy Foods, Inc. 6.88%
Attn: John Keith Berkley
941 E. Charleston Rd.
POB 50548
Palo Alto, CA 94303
</TABLE>
28
<PAGE> 30
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
Liebman, Reiner, Nachison & Walsh 6.14%
Attn: Helen Champion
3255 Wilshire Blvd., 12th Floor
Los Angeles, CA 90010
INCOME EQUITY FUND
------------------
INVESTOR SHARES
---------------
John A. Dito 6.47%
650 Itope St., #2800
Los Angeles, CA 90071
FIDUCIARY SHARES
----------------
The Bank of California N.A. 17.02%
Capital Accumulation Plan
400 California St.
San Francisco, CA 94104
The Bank of California 7.83%
Personal Retirement Option Plan
400 California St.
San Francisco, CA 94104
BALANCED FUND
-------------
INVESTOR SHARES
---------------
None
</TABLE>
29
<PAGE> 31
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
FIDUCIARY SHARES
----------------
The Bank of California, N.A. 25.74%
Capital Accumulation Plan
400 California St.
San Francisco, CA 94104
The Bank of California N.A. 13.10%
Personal Retirement Options Plan
400 California St.
San Francisco, CA 94104
Milligan New Company 5.12%
Attn: Jack Gillis
150 N. Autumn St.
San Jose, CA 95110
Sound Floor Coverings, Inc. 5.24%
Attn: Peter Chick
18375 Olympic Ave. South
Tukwila, WA 98188
Virgil V. Miller 6.28%
Tumac Lumber Co., Inc.
529 SW Third Ave.
Portland, OR 97204
BOND FUND
---------
INVESTOR SHARES
---------------
James Harris 6.28%
121 Christian Valley Rd.
Auburn, CA 95602
</TABLE>
30
<PAGE> 32
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
George L. Jacobs 39.24%
60 Ironwood
Upland, CA 94605
FIDUCIARY SHARES
----------------
The Bank of California N.A. 11.25%
Capital Accumulation Plan
400 California St.
San Francisco, CA 94104
The Bank of California N.A. 5.78%
Personal Retirement Options Plan
400 California St.
San Francisco, CA 94104
GOVERNMENT BOND FUND
--------------------
INVESTOR SHARES
---------------
None
FIDUCIARY SHARES
----------------
United Alloys Inc. Profit Sharing Plan 10.71%
900 East Slauson Ave.
Los Angeles, CA 90011
Fisher Implement Co. Profit Sharing Plan 6.49%
P.O. Box 159
Albany, OR 97321
Jose G. Bautista 7.44%
20480 View Point Road
Cistro Valley, CA 94592
</TABLE>
31
<PAGE> 33
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
Douglas T. Frederighi 5.29%
4 Quail Run
Lafayette, CA 94549
Michela Rizzuto 10.48%
1975 E. Heather Circle
Brea, CA 92621
Riverview Savings Bank 5.15%
Attn: Ronald Wysake
P.O. Box 1068
Carma, WA 98607
DIVERSIFIED OBLIGATIONS FUND
----------------------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
None.
U.S. GOVERNMENT OBLIGATION FUND
-------------------------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
Spitzel/Anderson Escrow 10.04%
3700 Wilshire Blvd. #820
Los Angeles, CA 90010
Lakeside Foundation 6.05%
50 Fremont Ste 3520
San Francisco, CA 94105
</TABLE>
32
<PAGE> 34
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
100% U.S. TREASURY FUND
-----------------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
The Bank of California, N.A. Capital 6.16%
Accumulation Plan
400 California Street
San Francisco, CA 94104
Louise Laverne Kohlstaedt 5.63%
c/o Emilie J. Rubright
3742 Forest Gate Drive N.E.
Iowa City, IA 52240
CALIFORNIA TAX FREE FUND
------------------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
None.
TAX FREE FUND
-------------
INVESTOR SHARES
---------------
None.
</TABLE>
33
<PAGE> 35
<TABLE>
<CAPTION>
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
<S> <C>
FIDUCIARY SHARES
----------------
Michael S. Engl 16.59%
Attn: Kitty Willard
P.O. Box 2500
Sun Valley, ID 83353
Neil Anderson 5.99%
2915 E. Madison St., #200
Seattle, WA 98112
CALIFORNIA MUNICIPAL FUND
-------------------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
None.
MUNICIPAL FUND
--------------
INVESTOR SHARES
---------------
None.
FIDUCIARY SHARES
----------------
None.
</TABLE>
The table below indicates each additional person other than The Bank of
California and the beneficial owners listed above who own of record 5% or more
of the Investor Shares of the following Funds of the Group as of November 17,
1995. As of November 17, 1995, the Lutheran Services
34
<PAGE> 36
Foundation, 2424 S. Fremont Ave., Alhambra, CA 91803 owned 10.33% of the
Fiduciary Shares of the Government Bond Fund. No person other than the Bank of
California and the beneficial owners listed above own of record more than 5% of
the Fiduciary Shares of a Fund.
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS RECORD OWNERSHIP
- ---------------- ----------------
<S> <C>
GROWTH FUND
-----------
Guy Paquet 6.63%
951 S. Beach Blvd.
La Habra, CA 90631
Bill and Yuriko Tsutagawa 6.00%
2242 Valley Rd.
Oceanside, CA 92056
Layne Hamilton 6.08%
11479 Round House Ct.
Gold River, CA 95670-7714
National Financial Services Corp. 27.24%
FBO Gary Frankosky
One World Financial Center
200 Liberty St. 4th Fl.
New York, NY 10281-0000
INCOME AND GROWTH FUND
----------------------
National Financial Services Corp. 9.67%
For the Exclusive Benefit of Customers
200 Liberty St.
New York, NY 10281
Bill and Yuriko Tsutagawa 44.15%
2242 Valley Rd.
Oceanside, CA 92056
</TABLE>
35
<PAGE> 37
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS RECORD OWNERSHIP
- ---------------- ----------------
<S> <C>
INCOME EQUITY FUND
------------------
Guy Paquet 7.86%
951 S. Beach Blvd.
La Habra, CA 90631
National Financial Services Corp. 29.56
FBO Gary Frankosky
One World Financial Center
200 Liberty St., 4th Fl.
New York, NY 10281
BALANCED FUND
-------------
John F. Roach 67.73%
587 Perugia Way
Los Angeles, CA 90077
Yoko Fujii 6.33%
and Tadashi Fujii
Trst Tadashi & Yoko Fujii 1992 Trst
DTD 11/27/92
1405 Lamont Ave.
Thousand Oaks, CA 91748
Rosalind Fahmy 8.87%
2691 Pocatello
Bolland Heights, CA 91748
BOND FUND
---------
Wallace Allred 6.02%
and Norma Allred
JT WROS
2250 N. Broadway No. 48
Escondido, CA 92026
National Financial Services Corp. 12.81%
</TABLE>
36
<PAGE> 38
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS RECORD OWNERSHIP
- ---------------- ----------------
<S> <C>
One World Financial Center
200 Liberty St. 4th Fl.
New York, NY
GOVERNMENT BOND FUND
--------------------
Chapa-De Indian Health Program, Inc. 91.81%
11670 Atwood Rd.
Auburn, CA 95603
DIVERSIFIED OBLIGATIONS FUND
----------------------------
National Financial Services Corp. 10.65%
For the Benefit of our Customers
One World Financial Center
200 Liberty St. 4th Fl.
New York, NY 10281
Managed Business Assets 5.45%
Ushio America Inc.
10550 Camchere Drive
Cypress, CA 90630
U.S. GOVERNMENT OBLIGATIONS FUND
--------------------------------
Managed Business Assets 6.49%
Phyxis Corporation
9380 Carroll Park Drive
San Diego, CA 92121
National Financial Services Corp. 18.51%
For The Benefit of our Customers
One World Financial Center
200 Liberty St., 4th Fl.
New York, NY 10281
</TABLE>
37
<PAGE> 39
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS RECORD OWNERSHIP
- ---------------- ----------------
<S> <C>
Saperstein Mayeda and Goldstein 30.84%
Dennys Class Settlement Fund
Attn: Helen Thompson
1300 Clay St., 11th Fl.
Oakland, CA 94612
Tulare County Treasurer 5.49%
c/o Gerald Fields
Civic Center Room 103E
Visalia, CA 93291
100% U.S. TREASURY FUND
-----------------------
National Financial Services Corp. 5.96%
For the Benefit of our Customers
One World Financial Center
200 Liberty St. 4th Fl.
New York, NY 10281
Daniel S. Coelho, Sr. 8.83%
300 S. Harbor Blvd. 1000
Anaheim, CA 92805
Liquor Barn Inc. 6.89%
7392 Trade St.
San Diego, CA 92121
CALIFORNIA TAX FREE FUND
------------------------
National Financial Services Corp. 41.16%
For the Benefit of Our Customers
One World Financial Center
200 Liberty St., 4th Fl.
New York, NY 10281-0000
TAX FREE FUND
-------------
Sally Skinner Behnke 5.72%
c/o REB Enterprises
1326 5th Ave., Suite 711
Seattle, WA 98101
</TABLE>
38
<PAGE> 40
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS RECORD OWNERSHIP
- ---------------- ----------------
<S> <C>
National Financial Services Corp. 30.67%
For the Benefit of our Customers
One World Financial Center
200 Liberty St., 4th Fl.
New York, NY 10281
DYK Incorporated 20.80%
Attn: Bob Dykmin
P.O. Box 696
El Cajon, CA 92022
Valley Concereto Company 7.23%
c/o L.P. Hughes
P.O. Box 55099
Seattle, WA 98155
CALIFORNIA MUNICIPAL FUND
-------------------------
None.
MUNICIPAL FUND
--------------
None.
</TABLE>
As of November 17, 1995, the Officers and Trustees of the Group owned
less than 1% of the Group's outstanding Shares.
INFORMATION ABOUT BISYS FUND SERVICES
The Group's principal distributor is BISYS Fund Services, Inc., 3435
Stelzer Road, Columbus, Ohio 43219. BISYS Fund Services, Inc. is wholly owned
by The BISYS Group, Inc., 150 Clove Road, Little Falls, New Jersey 07424, a
publicly owned company engaged in information processing, loan servicing and
401(k) administration and recordkeeping services to and through banking and
other financial organizations. The following persons are officers of the Group
and may be deemed to have an interest in BISYS Fund Services, Inc. by virtue of
their status as employees and/or executive officers of that company:
39
<PAGE> 41
<TABLE>
<CAPTION>
OFFICER
OF THE
NAME POSITION WITH FUNDS AGE FUNDS SINCE
- ---- ------------------- --- -----------
<S> <C> <C> <C>
Stephen G. Mintos Chairman and Trustee 41 1987
J. David Huber Vice President 49 1987
William J. Tomko Vice President 37 1991
Cynthia L. Lindsey Vice President 37 1993
Nancy E. Converse Secretary 46 1994
Martin Dean Treasurer 32 1995
Alaina Metz Assistant Secretary 28 1995
</TABLE>
Bank of California, N.A., has a dealer agreement with BISYS Fund
Services pursuant to which BOC is authorized to place orders with the Group's
Transfer Agent for the purchase of Shares and tender Shares to the Transfer
Agent for redemption.
If you do not expect to attend the Special Meeting, please sign your
proxy card promptly and return it in the enclosed envelope to avoid unnecessary
expense and delay. No postage is necessary.
January 22, 1996
40
<PAGE> 42
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of May 8, 1992 between THE HIGHMARK GROUP, a
Massachusetts business trust (herein called the "Group"), and THE BANK OF
CALIFORNIA, N.A., a national banking association with its principal offices in
San Francisco, California (herein called the "Investment Adviser").
WHEREAS, the Group is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940, as amended ("1940
Act"); and
WHEREAS, the Group desires to retain the Investment Adviser to furnish
investment advisory and administrative services to certain investment
portfolios of the Group (the "Funds") and the Investment Adviser represents
that it is willing and possesses legal authority to so furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Group hereby appoints the Investment Adviser to act
as investment adviser to the Funds identified on Schedule A hereto for the
period and on the terms set forth in this Agreement. The Investment Adviser
accepts such appointment and agrees to furnish the services herein set forth
for the compensation herein provided.
2. Delivery of Documents. The Group has furnished the Investment Adviser
with copies properly certified or authenticated of each of the following:
(a) the Group's Declaration of Trust, as filed with the Secretary of
State of the Commonwealth of Massachusetts on March 10, 1987, and all
amendments thereto or restatements thereof (such Declaration, as presently
in effect and as it shall from time to time be amended or restated, is
herein called the "Declaration of Trust");
(b) the Group's Code of Regulations and amendments thereto;
(c) resolutions of the Group's Board of Trustees authorizing the
appointment of the Investment Adviser and approving this Agreement;
<PAGE> 43
(d) the Group's Notification of Registration on Form N-8A under the
1940 Act as filed with the Securities and Exchange Commission on March 12,
1987 and all amendments thereto;
(e) the Group's Registration Statement on Form N-lA under the
Securities Act of 1933, as amended ("1933 Act"), (File No. 33-12608) and
under the 1940 Act as filed with the Securities and Exchange Commission
and all amendments thereto; and
(f) the Funds' most recent prospectuses and Statement of Additional
Information (such prospectuses and Statement of Additional Information, as
presently in effect, and all amendments and supplements thereto are herein
collectively called the "Prospectus").
The Group will furnish the Investment Adviser from time to time with
copies of all amendments of or supplements to the foregoing.
3. Management. Subject to the supervision of the Group's Board of
Trustees, the Investment Adviser will provide a continuous investment program
for each Fund, including investment research and management with respect to all
securities and investments and cash equivalents in said Funds. The Investment
Adviser will determine from time to time what securities and other investments
will be purchased, retained or sold by the Group with respect to the Funds.
The Investment Adviser will provide the services under this Agreement in
accordance with each Fund's investment objective, policies, and restrictions as
stated in the Prospectus and resolutions of the Group's Board of Trustees. The
Investment Adviser further agrees that it:
(a) will use the same skill and care in providing such services as it
uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(b) will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission and in addition will conduct its
activities under this Agreement in accordance with any applicable
regulations of any governmental authority pertaining to the investment
advisory activities of the Investment Adviser;
(c) will not make loans to any person to purchase or carry units of
beneficial interest in the Group or make loans to the Group;
(d) will place orders pursuant to its investment determinations for
the Group either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Investment Adviser will
attempt to obtain prompt execution of orders in an effective manner at the
most favorable price. Consistent with this obligation, when the execution
and price offered by two or more brokers or dealers are comparable, the
Investment Adviser may, in its discretion, purchase and sell portfolio
-2-
<PAGE> 44
securities to and from brokers and dealers who provide the Investment
Adviser with research advice and other services. Unless and until
appropriate procedures are adopted by the Trustees of the Group under Rule
17e-1 of the 1940 Act and unless the provisions of such Rule are complied
with, portfolio securities will not be purchased from or sold to The
Winsbury Company, The Bank of California, N.A., or any affiliated person
of either the Group, The Winsbury Company, or The Bank of California,
N.A.;
(e) will maintain all books and records with respect to the Group's
securities transactions and will furnish the Group's Board of Trustees
such periodic and special reports as the Board may request;
(f) will treat confidentially and as proprietary information of the
Group all records and other information relative to the Group and prior,
present or potential interestholders, and will not use such records and
information for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and approval in
writing by the Group, which approval shall not be unreasonably withheld
and may not be withheld where the Investment Adviser may be exposed to
civil or criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted authorities, or
when so requested by the Group; and
(g) will maintain its policy and practice of conducting its fiduciary
functions independently. In making investment recommendations for the
Group, the Investment Adviser's personnel will not inquire or take into
consideration whether the issuers of securities proposed for purchase or
sale for the Group's account are customers of the Investment Adviser or of
its parent or its subsidiaries or affiliates. In dealing with such
customers, the Investment Adviser and its parent, subsidiaries, and
affiliates will not inquire or take into consideration whether securities
of those customers are held by the Group.
4. Services Not Exclusive. The investment management services furnished
by the Investment Adviser hereunder are not to be deemed exclusive, and the
Investment Adviser shall be free to furnish similar services to others so long
as its services under this Agreement are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 3la-3
under the 1940 Act, the Investment Adviser hereby agrees that all records which
it maintains for the Group are the property of the Group and further agrees to
surrender promptly to the Group any of such records upon the Group's request.
The Investment Adviser further agrees to preserve for the periods prescribed by
Rule 3la-3 under the 1940 Act the records required to be maintained by Rule
3la-1 under the 1940 Act.
-3-
<PAGE> 45
6. Expenses. During the term of this Agreement, the Investment Adviser
will pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions, if any) purchased for the Group.
7. Compensation. For the services provided and the expenses assumed
pursuant to this Agreement, each of the Funds will pay the Investment Adviser
and the Investment Adviser will accept as full compensation therefor a fee
computed daily and paid monthly at the applicable annual rate set forth on
Schedule A hereto. Each Fund's obligation to pay the above-described fee to
the Investment Adviser will begin as of the date of the initial public sale of
shares in that Fund.
If in any fiscal year the aggregate expenses of any of the Funds (as
defined under the securities regulations of any state having jurisdiction over
the Group) exceed the expense limitations of any such state, the Investment
Adviser will reimburse the Fund for a portion of such excess expenses equal to
such excess times the ratio of the fees otherwise payable by the Fund to the
Investment Adviser hereunder to the aggregate fees otherwise payable by the
Fund to the Investment Adviser hereunder and to The Winsbury Company under the
Administration Agreement between The Winsbury Company and the Group. The
obligation of the Investment Adviser to reimburse the Funds hereunder is
limited in any fiscal year to the amount of its fee hereunder for such fiscal
year, provided, however, that notwithstanding the foregoing, the Investment
Adviser shall reimburse the Funds for such proportion of such excess expenses
regardless of the amount of fees paid to it during such fiscal year to the
extent that the securities regulations of any state having jurisdiction over
the Group so require. Such expense reimbursement, if any, will be estimated
daily and reconciled and paid on a monthly basis.
8. Limitation of Liability. The Investment Adviser shall not be liable
for any error of judgment or mistake of law or for any loss suffered by the
Funds in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Investment Adviser in the
performance of its duties or from reckless disregard by the Investment Adviser
of its obligations and duties under this Agreement.
9. Duration and Termination. This Agreement will become effective as to
a particular Fund as of the date first written above, provided that it shall
have been approved by vote of a majority of the outstanding voting securities
of such Fund, in accordance with the requirements under the 1940 Act, and,
unless sooner terminated as provided herein, shall continue in effect until
October 31, 1993.
Thereafter, if not terminated, this Agreement shall continue in effect as
to a particular Fund for successive periods of twelve months each ending on
October 31st of each year, provided such continuance is specifically approved
at least annually (a) by the vote of a majority of those members of the Group's
Board of Trustees who are not parties to this
-4-
<PAGE> 46
Agreement or interested persons of any party to this Agreement, cast in person
at a meeting called for the purpose of voting on such approval, and (b) by the
vote of a majority of the Group's Board of Trustees or by the vote of a
majority of the outstanding voting securities of such Fund. Notwithstanding
the foregoing, this Agreement may be terminated as to a particular Fund at any
time on sixty days' written notice, without the payment of any penalty, by the
Group (by vote of the Group's Board of Trustees or by vote of a majority of the
outstanding voting securities of such Fund) or by the Investment Adviser. This
Agreement will immediately terminate in the event of its assignment. (As used
in this Agreement, the terms "majority of the outstanding voting securities,"
"interested persons" and "assignment" shall have the same meaning of such terms
in the 1940 Act.)
10. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
11. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by the law of the Commonwealth of Massachusetts.
The names "The HighMark Group" and "Trustees of The HighMark Group" refer
respectively to the Trust created and the Trustees, as trustees but not
individually or personally, acting from time to time under a Declaration of
Trust dated as of March 10, 1987 to which reference is hereby made and a copy
of which is on file at the office of the Secretary of the Commonwealth of
Massachusetts and elsewhere as required by law, and to any and all amendments
thereto so filed or hereafter filed. The obligations of "The HighMark Group"
entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities,
and are not binding upon any of the Trustees, interestholders or
representatives of the Trust personally, but bind only the assets of the Trust,
and all persons dealing with any Fund of the Trust must look solely to the
assets of the Trust belonging to such Fund for the enforcement of any claims
against the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
THE HIGHMARK GROUP
Seal By: /s/ Kenneth B. Quintenz
------------------------
Title: President
------------------------
-5-
<PAGE> 47
THE BANK OF CALIFORNIA, N.A.
Seal By: /s/ Harold C. Warner
---------------------
Title: Senior Vice President
---------------------
-6-
<PAGE> 48
Dated: As of December 1, 1992
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
The Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation(1)
- ------------ ------------
<S> <C>
The Balanced Fund Annual rate of one percent (1.00%) of
the first $40 million of the Fund's
average daily net assets and sixty
one-hundredths of one percent (.60%)
of the remaining average daily net
assets.
The Growth Fund Annual rate of one percent (1.00%) of
the first $40 million of the Fund's
average daily net assets and sixty
one-hundredths of one percent (.60%)
of the remaining average daily net
assets.
The Government Bond Fund Annual rate of one percent (1.00%) of
the first $40 million of the Fund's
average daily net assets and sixty
one-hundredths of one percent (.60%)
of the remaining average daily net
assets.
The Income and Growth Fund Annual rate of one percent (1.00%) of
the first $40 million of the Fund's
average daily net assets and sixty
one-hundredths of one percent (.60%)
of the remaining average daily net
assets.
</TABLE>
THE HIGHMARK GROUP
By: /s/ Kenneth B. Quintenz
----------------------------
Title: President
THE BANK OF CALIFORNIA, N.A.
By: /s/ Harold C. Warner
----------------------------
Title:
-----------------------
- ------------------
(1) All fees are computed daily and paid periodically.
<PAGE> 49
EXHIBIT B
FORM OF
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of ____________________ between THE HIGHMARK GROUP, a
Massachusetts business trust (herein called the "Group:), and UNION BANK OF
CALIFORNIA, N.A., a national banking association with its principal offices in
San Francisco, California (herein called the "Investment Adviser").
WHEREAS, the Group is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940, as amended ("1940
Act"); and
WHEREAS, the Group desires to retain the Investment Adviser to furnish
investment advisory and administrative services to certain investment
portfolios of the Group (the "Funds") and the Investment Adviser represents
that it is willing and possesses legal authority to so furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Group hereby appoints the Investment Adviser to act
as investment adviser to the Funds identified on Schedule A hereto for the
period and on the terms set forth in this Agreement. The Investment Adviser
accepts such appointment and agrees to furnish the services herein set forth
for the compensation herein provided.
2. Delivery of Documents. The Group has furnished the Investment Adviser
with copies properly certified or authenticated of each of the following:
(a) the Group's Declaration of Trust, as filed with the Secretary of
State of the Commonwealth of Massachusetts on March 10, 1987, and all
amendments thereto or restatements thereof (such Declaration, as presently
in effect and as it shall from time to time be amended or restated, is
herein called the "Declaration of Trust");
(b) the Group's Code of Regulations and amendments thereto;
(c) resolutions of the Group's Board of Trustees authorizing the
appointment of the Investment Adviser and approving this Agreement;
<PAGE> 50
(d) the Group's Notification of Registration on Form N-8A under the
1940 Act as filed with the Securities and Exchange Commission on March 12,
1987 and all amendments thereto;
(e) the Group's Registration Statement on Form N-1A under the
Securities Act of 1933, as amended ("1933 Act"), (File No. 33-12608) and
under the 1940 Act as filed with the Securities and Exchange Commission
and all amendments thereto; and
(f) the Fund's most recent prospectuses and Statement of Additional
Information (such prospectuses and Statement of Additional Information, as
presently in effect, and all amendments and supplements thereto are herein
collectively called the "Prospectus").
The Group will furnish the Investment Adviser from time to time with
copies of all amendments of or supplements to the foregoing.
3. Management. Subject to the supervision of the Group's Board of
Trustees, the Investment Adviser will provide a continuous investment program
for each Fund, including investment research and management with respect to all
securities and investments and cash equivalents in said Funds. The Investment
Adviser will determine from time to time what securities and other investments
will be purchased, retained or sold by the Group with respect to the Funds.
The Investment Adviser will provide the services under this Agreement in
accordance with each Fund's investment objective, policies, and restrictions as
stated in the Prospectus and resolutions of the Group's Board of Trustees. The
Investment Adviser further agrees that it:
(a) will use the same skill and care in providing such services as
it uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(b) will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission and in addition will conduct its
activities under this Agreement in accordance with any applicable
regulations of any governmental authority pertaining to the investment
advisory activities of the Investment Adviser;
(c) will not make loans to any person to purchase or carry units of
beneficial interest in the Group or make loans to the Group;
(d) will place orders pursuant to its investment determinations for
the Group either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Investment Adviser will
attempt to obtain prompt execution of orders in an effective manner at the
most favorable price. Consistent with this obligation, when the execution
and price offered by two or more brokers or dealers are comparable, the
Investment Adviser may, in its discretion, purchase and sell portfolio
-2-
<PAGE> 51
securities to and from brokers and dealers who provide the Investment
Adviser with research advice and other services. Unless and until
appropriate procedures are adopted by the Trustees of the Group under Rule
17e-1 of the 1940 Act and unless the provisions of such Rule are complied
with, portfolio securities will not be purchased from or sold to BISYS
Fund Services, Union Bank of California, N.A., or any affiliated person of
either the Group, BISYS Fund Services, or Union Bank of California, N.A.;
(e) will maintain all books and records with respect to the Group's
securities transactions and will furnish the Group's Board of Trustees
such periodic and special reports as the Board may request;
(f) will treat confidentially and as proprietary information of the
Group all records and other information relative to the Group and prior,
present or potential interestholders; and will not use such records and
information for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and approval in
writing by the Group, which approval shall not be unreasonably withheld
and may not be withheld where the Investment Adviser may be exposed to
civil or criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted authorities, or
when so requested by the Group; and
(g) will maintain its policy and practice of conducting its
fiduciary functions independently. In making investment recommendations
for the Group, the Investment Adviser's personnel will not inquire or take
into consideration whether the issuers of securities proposed for purchase
or sale for the Group's account are customers of the Investment Adviser or
of its parent or its subsidiaries or affiliates. In dealing with such
customers, the Investment Adviser and its parent, subsidiaries, and
affiliates will not inquire or take into consideration whether securities
of those customers are held by the Group.
4. Services Not Exclusive. The investment management services furnished
by the Investment Adviser hereunder are not to be deemed exclusive, and the
Investment Adviser shall be free to furnish similar services to others so long
as its services under this Agreement are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Investment Adviser hereby agrees that all records which
it maintains for the Group are the property of the Group and further agrees to
surrender promptly to the Group any of such records upon the Group's request.
The Investment Adviser further agrees to preserve for the periods prescribed by
Rule 31a-3 under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act.
-3-
<PAGE> 52
6. Expenses. During the term of this Agreement, the Investment Adviser
will pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions, if any) purchased for the Group.
7. Compensation. For the services provided and the expenses assumed
pursuant to this Agreement, each of the Funds will pay the Investment Adviser
and the Investment Adviser will accept as full compensation therefor a fee
computed daily and paid monthly at the applicable annual rate set forth on
Schedule A hereto. Each Fund's obligation to pay the above-described fee to
the Investment Adviser will begin as of the date of the initial public sale of
shares in that Fund.
If in any fiscal year the aggregate expenses of any of the Funds (as
defined under the securities regulations of any state having jurisdiction over
the Group) exceed the expense limitations of any such state, the Investment
Adviser will reimburse the Fund for a portion of such excess expenses equal to
such excess times the ratios of the fees otherwise payable by the Fund to the
Investment Adviser hereunder to the aggregate fees otherwise payable by the
Fund to the Investment Adviser hereunder and to BISYS Fund Services under the
Administration Agreement between BISYS Fund Services and the Group. The
obligation of the Investment Adviser to reimburse the Funds hereunder is
limited in any fiscal year to the amount of its fee hereunder for such fiscal
year, provided, however, that notwithstanding the foregoing, the Investment
Adviser shall reimburse the Funds for such proportion of such excess expenses
regardless of the amount of fees paid to it during such fiscal year to the
extent that the securities regulations of any state having jurisdiction over
the Group so require. Such expense reimbursement, if any, will be estimated
daily and reconciled and paid on a monthly basis.
8. Limitation of Liability. The Investment Adviser shall not be liable
for any error of judgment or mistake of law or for any loss suffered by the
Funds in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Investment Adviser in the
performance of its duties or from reckless disregard by the Investment Adviser
of its obligations and duties under this Agreement.
9. Duration and Termination. This Agreement will become effective as to
a particular Fund as of the date first written above, provided that it shall
have been approved by vote of a majority of the outstanding voting securities
of such Fund, in accordance with the requirements under the 1940 Act, and,
unless sooner terminated as provided herein, shall continue in effect until
___________________.
Thereafter, if not terminated, this Agreement shall continue in effect as
to a particular Fund for successive periods of twelve months each ending on
October 31st of each year, provided such continuance is specifically approved
at least annually (a) by the vote of a majority of those members of the Group's
Board of Trustees who are not parties to this
-4-
<PAGE> 53
Agreement or interested persons of any party to this Agreement, cast in person
at a meeting called for the purpose of voting on such approval, and (b) by the
vote of a majority of the Group's Board of Trustees or by the vote of a
majority of the outstanding voting securities of such Fund. Notwithstanding
the foregoing, this Agreement may be terminated as to a particular Fund at any
time on sixty days' written notice, without the payment of any penalty, by the
Group (by vote of the Group's Board of Trustees or by vote of a majority of the
outstanding voting securities of such Fund) or by the Investment Adviser. This
Agreement will immediately terminate in the event of its assignment. (As used
in this Agreement, the terms "majority of the outstanding voting securities,"
"interested persons" and "assignment" shall have the same meaning of such terms
in the 1940 Act.)
10. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
11. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by the law of the Commonwealth of Massachusetts.
The names "The HighMark Group" and "Trustees of The HighMark Group" refer
respectively to the Trust created and the Trustees, as trustees but not
individually or personally, acting from time to time under a Declaration of
Trust dated as of March 10, 1987 to which reference is hereby made and a copy
of which is on file at the office of the Secretary of the Commonwealth of
Massachusetts and elsewhere as required by law, and to any and all amendments
thereto so filed or hereafter filed. The obligations of "The HighMark Group"
entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities,
and are not binding upon any of the Trustees, interestholders or
representatives of the Trust personally, but bind only the assets of the Trust,
and all persons dealing with any Fund of the Trust must look solely to the
assets of the Trust belonging to such Fund for the enforcement of any claims
against the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
THE HIGHMARK GROUP
Seal By:
-------------------------------------
Title:
----------------------------------
-5-
<PAGE> 54
UNION BANK OF CALIFORNIA, N.A.
Seal By:
-------------------------------------
Title:
----------------------------------
-6-
<PAGE> 55
Dated as of ______________, 1995
Form of
Amended and Restated
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
Union Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation*
- ------------ ------------
<S> <C>
The U.S. Government Obligations Fund Annual rate of forty
one-hundredths of one
percent (.40%) of the U.S.
Government Obligations
Fund's first $500 million
of average daily net
assets, thirty-five
one-hundredths of one
percent (.35%) of the next
$500 million of average
daily net assets, and
thirty one-hundredths of
one percent (.30%) of the
remaining average daily net
assets.
The Diversified Obligations Fund Annual rate of forty
one-hundredths of one
percent (.40%) of the
Diversified Obligations
Fund's first $500 million
of average daily net
assets, thirty-five
one-hundredths of one
percent (.35%) of the next
$500 million of average
daily net assets, and
thirty one-hundredths of
one percent (.30%) of the
remaining average daily net
assets.
</TABLE>
A-1
<PAGE> 56
Form of
Amended and Restated
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
Union Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation*
- ------------ ------------
<S> <C>
The 100% U.S. Treasury Obligations Fund Annual rate of forty
one-hundredths of one
percent (.40%) of the U.S.
Treasury Obligations Fund's
first $500 million of
average daily net assets,
thirty-five one-hundredths
of one percent (.35%) of
the next $500 million of
average daily net assets,
and thirty one-hundredths
of one percent (.30%) of
the remaining average daily
net assets.
The Income Equity Fund Annual rate of one percent
(1.00%) of the first $40
million of the Income
Equity Fund's average daily
net assets and sixty
one-hundredths of one
percent (.60%) of the
remaining average daily net
assets.
The Bond Fund Annual rate of one percent
(1.00%) of the first $40
million of the Bond Fund's
average daily net assets
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
</TABLE>
A-2
<PAGE> 57
Form of
Amended and Restated
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
Union Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation*
- ------------ ------------
<S> <C>
The Tax-Free Fund Annual rate of forty
one-hundredths of one
percent (.40%) of the
Tax-Free Fund's first $500
million of average daily
net assets, thirty-five
one-hundredths of one
percent (.35%) of the next
$500 million of average
daily net assets, and
thirty one-hundredths of
one percent (.30%) of the
remaining average daily net
assets.
The California Tax-Free Fund Annual rate of forty
one-hundredths of one
percent (.40%) of the
California Tax-Free Fund's
first $500 million of
average daily net assets,
thirty-five one-hundredths
of one percent (.35%) of
the next $500 million of
average daily net assets,
and thirty one-hundredths
of one percent (.30%) of
the remaining average daily
net assets.
The Balanced Fund Annual rate of one percent
(1.00%) of the first $40
million of the Fund's
average daily net assets
</TABLE>
A-3
<PAGE> 58
Form of
Amended and Restated
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
Union Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation*
- ------------ ------------
<S> <C>
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
The Growth Fund Annual rate of one percent
(1.00%) of the first $40
million of the Fund's
average daily net assets
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
The Government Bond Fund Annual rate of one percent
(1.00%) of the first $40
million of the Fund's
average daily net assets
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
The Income and Growth Fund Annual rate of one percent
(1.00%) of the first $40
million of the Fund's
average daily net assets
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
The Intermediate California Annual rate of one percent
Municipal Bond Fund (1.00%) of the first $40
million of
</TABLE>
A-4
<PAGE> 59
Form of
Amended and Restated
Schedule A
to the
Investment Advisory Agreement
between The HighMark Group and
Union Bank of California, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation*
- ------------ ------------
<S> <C>
the Fund's average daily
net assets and sixty
one-hundredths of one
percent (.60%) of the
remaining average daily net
assets.
The Intermediate Municipal Annual rate of one percent
Bond Fund (1.00%) of the first $40
million of the Fund's
average daily net assets
and sixty one-hundredths of
one percent (.60%) of the
remaining average daily net
assets.
</TABLE>
THE HIGHMARK GROUP
By:
--------------------------
Title: President
UNION BANK OF CALIFORNIA, N.A.
By:
--------------------------
Title:
-----------------------
A-5
<PAGE> 60
EXHIBIT C
SUB-ADMINISTRATION AGREEMENT
AGREEMENT made this 23rd day of December, 1991, between THE WINSBURY
COMPANY LIMITED PARTNERSHIP, d/b/a The Winsbury Company ("Winsbury"), a
partnership organized under the laws of the State of Ohio and having its
principal place of business at 1900 East Dublin-Granville Road, Columbus, Ohio
43229, and THE BANK OF CALIFORNIA, N.A. (the "Sub-Administrator"), a national
banking association having its main office at 400 California Street, San
Francisco, California 94101.
WHEREAS, Winsbury has entered into a Management and Administration
Agreement, dated December 23, 1991 (the "Management and Administration
Agreement"), with The HighMark Group (the "Trust"), a Massachusetts business
trust having its principal place of business at 1900 East Dublin-Granville
Road, Columbus, Ohio 43229, concerning the provision of management and
administrative services for the investment portfolios of the Trust identified
on Schedule A hereto, as such Schedule shall be amended from time to time
(individually referred to herein as the "Fund" and collectively as the
"Funds"); and
WHEREAS, Winsbury desires to retain the Sub-Administrator to assist it in
performing administrative services with respect to each Fund and the
Sub-Administrator is willing to perform such services on the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. Services as Sub-Administrator. The Sub-Administrator will assist
Winsbury in providing administrative services with respect to each Fund as may
be reasonably requested by Winsbury from time to time. Such services may
include, but are in no way limited to, such clerical, bookkeeping, accounting,
stenographic, and administrative services which will enable Winsbury to more
efficiently perform its obligations under the Management and Administration
Agreement. Specific assignments may include:
(i) With regard to the investment adviser to the Trust, and at the
direction of Winsbury, to:
a. advise with regard to various compliance requirements including
but not limited to the performance of credit analysis as
required by Rule 2a-7
<PAGE> 61
under the Investment Company Act of 1940, as amended (the "1940
Act");
b. assist in the preparation of Trustees' compliance reports;
c. assist in the resolution of other technical issues of a
non-compliance nature; and
d. serve as on-site liaison;
(ii) Gathering of information deemed necessary by Winsbury to support
(a) required state regulatory filings (including filings required to be
made with California tax, blue sky and bank agencies) and (b) required
federal regulatory filings;
(iii) Preparation of statistical and research data;
(iv) Assistance in the preparation of the Group's Annual and Semi-Annual
Reports to Shareholders; and
(v) Assistance in the gathering of data from the investment adviser to
the Trust for inclusion in Winsbury's periodic reports to the Trustees.
The Sub-Administrator will keep and maintain all books and records relating
to its services in accordance with Rule 31a-1 under the 1940 Act.
2. Compensation; Reimbursement of Expenses. Winsbury shall pay the
Sub-Administrator for the services to be provided by the Sub-Administrator
under this Agreement in accordance with, and in the manner set forth in,
Schedule B hereto. In addition, Winsbury agrees to reimburse the
Sub-Administrator for the Sub-Administrator's reasonable out-of-pocket expenses
in providing services hereunder.
3. Effective Date. This Agreement shall become effective with respect
to a Fund as of the date first written above (or, if a particular Fund is not
in existence on that date, on the date specified in the amendment to Schedule A
to this Agreement relating to such Fund or, if no date is specified, the date
on which such amendment is executed) (the "Effective Date").
4. Term. This Agreement shall continue in effect with respect to a
Fund, unless earlier terminated by either party hereto as provided hereunder,
until October 31, 1993, and thereafter shall be renewed automatically for
successive one-year terms unless written notice not to renew is given by the
non-renewing party to the other party at least 60 days prior to the expiration
of the then-current term; provided, however, that after such termination for so
long
-2-
<PAGE> 62
as the Sub-Administrator, with the written consent of Winsbury, in fact
continues to perform any one or more of the services contemplated by this
Agreement or any schedule or exhibit hereto, the provisions of this Agreement,
including without limitation the provisions dealing with indemnification, shall
continue in full force and effect. Either party to this Agreement may
terminate such Agreement prior to the expiration of the initial term set forth
above by providing the other party with written notice of such termination at
least 60 days prior to the date upon which such termination shall become
effective. Compensation due the Sub-Administrator and unpaid by Winsbury upon
such termination shall be immediately due and payable upon and notwithstanding
such termination. The Sub-Administrator shall be entitled to collect from
Winsbury, in addition to the compensation described under paragraph 2 hereof,
the amount of all the Sub-Administrator's cash disbursements for services in
connection with the Sub-Administrator's activities in effecting such
termination, including without limitation, the delivery to Winsbury, the Trust,
and/or their respective designees of the Trust's property, records, instruments
and documents, or any copies thereof. Subsequent to such termination for a
reasonable fee to be paid by Winsbury, the Sub-Administrator will provide
Winsbury and/or the Trust with reasonable access to any Trust documents or
records remaining in its possession.
5. Standard of Care; Reliance on Records and Instructions;
Indemnification. The Sub-Administrator shall use its best efforts to insure
the accuracy of all services performed under this Agreement, but shall not be
liable to Winsbury or the Trust for any action taken or omitted by the
Sub-Administrator in the absence of bad faith, willful misfeasance, negligence
or from reckless disregard by it of its obligations and duties. Winsbury
agrees to indemnify and hold harmless the Sub-Administrator, its employees,
agents, directors, officers and nominees from and against any and all claims,
demands, actions and suits, whether groundless or otherwise, and from and
against any and all judgments, liabilities, losses, damages, costs, charges,
counsel fees and other expenses of every nature and character arising out of or
in any way relating to the Sub-Administrator's actions taken or nonactions with
respect to the performance of services under this Agreement with respect to a
Fund or based, if applicable, upon reasonable reliance on information, records,
instructions or requests with respect to such Fund given or made to the
Sub-Administrator by a duly authorized representative of Winsbury; provided
that this indemnification shall not apply to actions or omissions of the
Sub-Administrator in cases of its own bad faith, willful misfeasance,
negligence or from reckless disregard by it of its obligations and duties, and
further provided that prior to confessing any claim against it which may be the
subject of this indemnification, the Sub-Administrator shall give Winsbury
written notice of and reasonable opportunity to defend against said claim in
its own name or in the name of the Sub-Administrator.
6. Record Retention and Confidentiality. The Sub-Administrator shall
keep and maintain on behalf of the Trust all books and records which the Trust
and the Sub-Administrator are, or may be, required to keep and maintain in
connection with the services to
-3-
<PAGE> 63
be provided hereunder pursuant to any applicable statutes, rules and
regulations, including without limitation Rules 31a-1 and 31a-2 under the 1940
Act. The Sub-Administrator further agrees that all such books and records
shall be the property of the Trust and to make such books and records available
for inspection by the Trust, by Winsbury, or by the Securities and Exchange
Commission at reasonable times and otherwise to keep confidential all books and
records and other information relative to the Trust and its shareholders;
except when requested to divulge such information by duly-constituted
authorities or court process.
7. Uncontrollable Events. The Sub-Administrator assumes no
responsibility hereunder, and shall not be liable, for any damage, loss of
data, delay or any other loss whatsoever caused by events beyond its reasonable
control.
8. Rights of Ownership. All computer programs and procedures developed
to perform the services to be provided by the Sub-Administrator under this
Agreement are the property of the Sub-Administrator. All records and other
data except such computer programs and procedures are the exclusive property of
the Trust and all such other records and data will be furnished to Winsbury
and/or the Trust in appropriate form as soon as practicable after termination
of this Agreement for any reason.
9. Return of Records. The Sub-Administrator may at its option at any
time, and shall promptly upon the demand of Winsbury and/or the Trust, turn
over to Winsbury and/or the Trust and cease to retain the Sub-Administrator's
files, records and documents created and maintained by the Sub-Administrator
pursuant to this Agreement which are no longer needed by the Sub-Administrator
in the performance of its services or for its legal protection. If not so
turned over to Winsbury and/or the Trust, such documents and records will be
retained by the Sub-Administrator for six years from the year of creation. At
the end of such six-year period, such records and documents will be turned over
to Winsbury and/or the Trust unless the Trust authorizes in writing the
destruction of such records and documents.
10. Representations of Winsbury. Winsbury certifies to the
Sub-Administrator that this Agreement has been duly authorized by Winsbury and,
when executed and delivered by Winsbury, will constitute a legal, valid and
binding obligation of Winsbury, enforceable against Winsbury in accordance with
its terms, subject to bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting the rights and remedies of
creditors and secured parties.
11. Representations of the Sub-Administrator. The Sub-Administrator
represents and warrants that: (1) the various procedures and systems which the
Sub-Administrator has implemented with regard to safeguarding from loss or
damage attributable to fire, theft, or any other cause of the records and other
data of the Trust and the Sub-Administrator's records, data, equipment
facilities and other property used in the performance of its obligations
-4-
<PAGE> 64
hereunder are adequate and that it will make such changes therein from time to
time as are required for the secure performance of it obligations hereunder,
and (2) this Agreement has been duly authorized by the Sub-Administrator and,
when executed and delivered by the Sub-Administrator, will constitute a legal,
valid and binding obligation of the Sub-Administrator, enforceable against the
Sub-Administrator in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties.
12. Insurance. The Sub-Administrator shall notify Winsbury should any of
its insurance coverage be cancelled or reduced. Such notification shall
include the date of change and the reasons therefor. The Sub-Administrator
shall notify Winsbury of any material claims against it with respect to
services performed under this Agreement, whether or not they may be covered by
insurance, and shall notify Winsbury from time to time as may be appropriate of
the total outstanding claims made by the Sub-Administrator under its insurance
coverage.
13. Notices. Any notice provided hereunder shall be sufficiently given
when sent by registered or certified mail to Winsbury at the following address:
1900 East Dublin-Granville Road, Columbus, Ohio 43229, and to the
Sub-Administrator at the following address: 400 California Street, San
Francisco, California 94104, or at such other address as either party may from
time to time specify in writing to the other party pursuant to this Section.
14. Headings. Paragraph headings in this Agreement are included for
convenience only and are not to be used to construe or interpret this
Agreement.
15. Assignment. This Agreement and the rights and duties hereunder shall
not be assignable with respect to a Fund by either of the parties hereto except
by the specific written consent of the other party and with the specific
written consent of the Trust.
16. Governing Law. This Agreement shall be governed by and provisions
shall be construed in accordance with the laws of The Commonwealth of
Massachusetts.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
[SEAL] THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation,
General Partner
-5-
<PAGE> 65
By: /s/ Kenneth B. Quintenz
-------------------------------
Title: Chairman
----------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Karen Kinney
-------------------------------
Title: Vice President and Manager
----------------------------
-6-
<PAGE> 66
Dated: As of December 1, 1992
AMENDED AND RESTATED
SCHEDULE A
TO THE SUB-ADMINISTRATION AGREEMENT
BETWEEN
THE WINSBURY COMPANY
AND
THE BANK OF CALIFORNIA, N.A.
NAME OF FUND
The HighMark U.S. Government Obligations Fund
The HighMark Diversified Obligations Fund
The HighMark 100% U.S. Treasury Obligations Fund
The HighMark Tax-Free Fund
The HighMark California Tax-Free Fund
The HighMark Balanced Fund
The HighMark Growth Fund
The HighMark Income Equity Fund
The HighMark Special Growth Equity Fund
The HighMark Bond Fund
The HighMark Government Bond Fund
The HighMark Income and Growth Fund
THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation
General Partner
By: /s/ Ron Henderson
---------------------------------
Title: President
------------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Karen Kinney
---------------------------------
Title: Vice President and Manager
------------------------------
A-1
<PAGE> 67
Dated: As of December 1, 1992
AMENDED AND RESTATED
SCHEDULE B
TO THE SUB-ADMINISTRATION AGREEMENT
BETWEEN
THE WINSBURY COMPANY
AND
THE BANK OF CALIFORNIA, N.A.
<TABLE>
<CAPTION>
Name of Fund Compensation(1)
------------ --------------------
<S> <C>
The HighMark California Tax-Free Annual Rate of up to
Fund five one-hundredths
The HighMark Diversified (.05%) of each such
Obligations Fund Fund's average daily
The HighMark Tax-Free Fund net assets
The HighMark U.S. Government
Obligations Fund
The HighMark 100% U.S. Treasury
Obligations Fund
The HighMark Balanced Fund
The HighMark Growth Fund
The HighMark Special Growth Equity Fund
The HighMark Income Equity Fund
The HighMark Bond Fund
The HighMark Government Bond Fund
The HighMark Income and Growth Fund
</TABLE>
THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation
General Partner
By: /s/ Ron Henderson
----------------------------
Title: President
--------------------------
- -------------------
(1) All fees are computed daily and paid periodically.
B-1
<PAGE> 68
THE BANK OF CALIFORNIA, N.A.
By: /s/ Karen Kinney
--------------------------------
Title: Vice President and Manager
-----------------------------
B-2
<PAGE> 69
EXHIBIT D
SUB-TRANSFER AGENCY AGREEMENT
Agreement made this 22nd day of February, 1989, between The Winsbury
Service Corporation (the "Transfer Agent"), a corporation organized under the
laws of the State of Ohio and having its principal place of business at 33
North Third Street, Columbus, Ohio 43215, and The Bank of California, N.A.
(the "Sub-Transfer Agent"), a national banking association having its main
office at 400 California Street, San Francisco, California 94102.
WHEREAS, the Transfer Agent is the transfer agent and shareholder
servicing agent for various investment portfolios of The HighMark Group (the
"Group") pursuant to a Transfer Agent and Shareholder Service Agreement between
the Transfer Agent and the Group; and
WHEREAS, the parties hereto have agreed to arrange separately for the
performance of transfer agency and shareholder service functions for owners of
units of beneficial interest ("Shares") of the Group's investment portfolios
identified on Schedule A hereto ("Funds") who maintain the type of account
("Account") with the Sub-Transfer Agent or its affiliates identified on
Schedule B hereto ("Accountholders"); and
WHEREAS, the Transfer Agent desires to retain the Sub-Transfer Agent to
perform such services and the Sub-Transfer Agent is willing to perform such
services on the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. The Sub-Transfer Agent shall perform, subject to instructions from
the Transfer Agent, the services set forth on Schedule C hereto.
2. The Sub-Transfer Agent represents that it has registered as a
transfer agent under the Securities Exchange Act of 1934, and that it will
maintain and preserve all records as required by any applicable statutes,
rules, and regulations to be maintained and preserved in connection with the
performance of the services provided under this Agreement (including without
limitation all records required to be maintained and preserved on behalf of the
Group pursuant to Rules 31a-1 and 31a-2 of the Investment Company Act of 1940),
and that it will otherwise comply with all laws, rules, and
<PAGE> 70
regulations applicable to the services provided under this Agreement. The
Sub-Transfer Agent hereby agrees to make such records available for inspection
by the Transfer Agent or the Group or the Securities and Exchange Commission at
reasonable times and otherwise to keep confidential all records and other
information relative to the Group and the owners of its Shares
("Shareholders"); except when requested to divulge such information by
duly-constituted authorities or court process, or requested by a Shareholder
with respect to information concerning an account as to which such Shareholder
has either a legal or beneficial interest or when requested by the Transfer
Agent, the Group, or the Shareholder. The Sub-Transfer Agent further agrees
that it will permit the Transfer Agent to have reasonable access to its
personnel and records in order to facilitate the monitoring of the quality of
the services provided under this Agreement. Upon the request of the Transfer
Agent, the Sub-Transfer Agent shall provide copies of all the historical
records relating to transactions involving a Fund and an Accountholder, written
communications regarding a Fund to or from an Accountholder, and other
materials, in each case as may reasonably be requested to enable the Transfer
Agent or its representatives to monitor and review the services to be provided
hereunder, or to comply with any request of the Board of Trustees of the Group
or of a governmental body or self-regulatory organization or a Shareholder.
Among other things, the Sub-Transfer Agent agrees to provide promptly at the
request of the Transfer Agent a complete and accurate set of mailing labels
with the name and address of each Accountholder, and also upon such request
both an accounting history in machine readable form of each individual account
and a printout thereof.
3. The Sub-Transfer Agent may at its option at any time, and shall
promptly upon the Transfer Agent's demand, turn over to the Transfer Agent and
cease to retain the Sub-Transfer Agent's files, records and documents created
and maintained by the Sub-Transfer Agent pursuant to this Agreement which are
no longer needed by the Sub-Transfer Agent in the performance of its services
or for its legal protection. If not so turned over to the Transfer Agent, such
documents and records will be retained by the Sub-Transfer Agent for six years
from the year of creation. At the end of such six-year period, such records
and documents will be turned over to the Transfer Agent unless the Transfer
Agent, upon written authorization from the Group, authorizes in writing the
destruction of such records and documents.
4. All computer programs and procedures developed to perform services
required to be provided by the Sub-Transfer Agent under this Agreement are the
property of the Sub-Transfer Agent. All records and other data except such
computer programs and procedures are the exclusive property of the Group and
all such other records and data will be furnished to the Transfer Agent on
behalf of the Group in appropriate form as soon as practicable after
termination of this Agreement for any reason. The Sub-Transfer Agent
represents and warrants that the various procedures and
-2-
<PAGE> 71
systems which the Sub-Transfer Agent has implemented with regard to
safeguarding from loss or damage attributable to fire, theft, or any other
cause of the blank checks, records, and other data of the Group and the
Sub-Transfer Agent's records, data, equipment facilities, and other property
used in the performance of its obligations under this Agreement are adequate,
and that it will make such changes therein from time to time as are required
for the secure performance of its obligations under this Agreement.
5. The Sub-Transfer Agent hereby agrees to promptly notify the Transfer
Agent if for any reason it is unable to perform fully and promptly any of its
obligations under this Agreement with respect to any Fund or any Accountholder.
6. The Sub-Transfer Agent hereby understands and acknowledges that the
provisions of this Agreement do not in any way limit the authority of the Group
to take such action as it may deem appropriate or advisable in connection with
all matters relating to the operations of a Fund and the sale of such Fund's
Shares.
7. The Transfer Agent shall pay the Sub-Transfer Agent for the services
to be provided under this Agreement in accordance with, and in the manner set
forth in, Schedule D hereto, and to reimburse the Sub-Transfer Agent for
postage, handling fees, and reasonable costs of supplies used by the
Sub-Transfer Agent in the performance of the services provided under this
Agreement. The fees to be paid pursuant to this Section 7 may be changed upon
the written consent of the parties hereto.
8. The Sub-Transfer Agent shall use its best efforts to insure the
accuracy of all services performed under this Agreement, and the Transfer Agent
shall indemnify and hold harmless the Sub-Transfer Agent, its employees,
agents, directors, and officers from and against any and all claims, demands,
actions and suits, whether groundless or otherwise, and from and against any
and all judgments, liabilities, losses, damages, costs, charges, counsel fees
and other expenses of every nature and character arising out of or in any way
relating to the Sub-Transfer Agent's actions taken or non-actions with respect
to the performance of services under this Agreement or based, if applicable,
upon information, instructions or requests made to the Sub-Transfer Agent by an
officer or employee of the Transfer Agent; provided that this indemnification
shall not apply to actions or omissions of the Sub-Transfer Agent in cases of
its own bad faith, willful misconduct or gross negligence, and further provided
that prior to confessing any claim against it which may be the subject of this
indemnification, the Sub-Transfer Agent shall give the Transfer Agent written
notice of and reasonable opportunity to defend against said claim in its own
name or in the name of the Sub-Transfer Agent.
9. This Agreement and the rights and duties hereunder shall not be
assignable by either party hereto except by the specific written consent of the
other
-3-
<PAGE> 72
party. This Agreement shall become effective as of the date first written
above, and thereafter may be terminated at any time by either party hereto upon
thirty (30) days written notice to the other party. Upon termination of this
Agreement, the Sub-Transfer Agent shall be entitled to collect from the
Transfer Agent, in addition to the fees and reimbursement of expenses provided
in Section 7 hereof, its reasonable expenses in connection with the
Sub-Transfer Agent's activities in effecting such termination, including
without limitation, the delivery to the Transfer Agent of the property,
records, instruments and documents, or any copies thereof, relating to the
Sub-Transfer Agent's services under this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first written above.
THE WINSBURY SERVICE CORPORATION
By: /s/ Kenneth B. Quintenz
-------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------------
-4-
<PAGE> 73
Dated: As of December 1, 1992
AMENDED AND RESTATED
SCHEDULE A
to the Sub-Transfer Agency
Agreement between The Winsbury
Service Corporation and The Bank
California, N.A.
Name of Fund
The Balanced Fund
The Growth Fund
The Income Equity Fund
The Special Growth Equity Fund
The Bond Fund
The U.S. Government Obligations Fund
The Diversified Obligations Fund
The 100% U.S. Treasury Obligations Fund
The Tax-Free Fund
The California Tax-Free Fund
The Government Bond Fund
The Income and Growth Fund
THE WINSBURY SERVICE CORPORATION
By /s/ Ron Henderson
------------------------
A-1
<PAGE> 74
THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------
A-2
<PAGE> 75
SCHEDULE B
Type of Account
Individual Retirement Accounts invested in the Group's Funds, including,
but not limited to, those Individual Retirement Accounts invested in the
Group's Funds as a result of the reorganization of the investment portfolios of
the IRA Collective Investment Fund (the "IRA Fund") and certain Funds of the
Group pursuant to an Agreement and Plan of Reorganization between the IRA Fund,
the Group, and The Bank of California, N.A., dated April 20, 1988, and amended
June 21, 1988.
THE WINSBURY SERVICE CORPORATION
By: /s/ Kenneth B. Quintenz
-------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------------
B-1
<PAGE> 76
SCHEDULE C
I. Record Maintenance
The Sub-Transfer Agent shall provide full maintenance of all Shareholder
records for each Accountholder. Such records will include:
A. Share balances;
B. Account transaction history, including dividends paid and the date
and price for all transactions;
C. Name and address of the record Shareholder, including zip codes and
certified tax identification numbers and impending back-up
withholding;
D. Records of distributions and dividend payments;
E. Transfer records; and
F. Overall control records.
II. Regular Daily Operations.
The Sub-Transfer Agent shall perform the following functions daily with
respect to Accountholders:
A. Process new accounts on the Shareholder file;
B. Process additional purchases to the records of accounts already on
the Shareholder file;
C. Process redemptions as instructed by the Accountholder;
D. Transfer of Shares upon instructions from the Accountholder; and
E. Process changes of Accountholder/representative on accounts.
C-1
<PAGE> 77
III. Periodic Operations.
The Sub-Transfer Agent shall perform the following functions periodically
with respect to Accountholders:
A. Mail semi-annual and annual Group and/or Fund reports and
prospectuses;
B. Produce transcripts of account history as requested by the Transfer
Agent; and
C. Prepare and file Form 1099's with the Internal Revenue Service, and
any similar applicable forms or documents required under state law.
IV. Controls.
The Sub-Transfer Agent shall maintain all balance controls daily and
produce monthly summaries expressed in:
A. Shares; and
B. dollar amounts.
V. Special Services Included.
The Sub-Transfer Agent shall prepare envelopes/labels and mail proxy
statements, and shall tabulate and certify votes from returned ballots.
THE WINSBURY SERVICE CORPORATION
By:/s/ Kenneth B. Quintenz
----------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
---------------------------
C-2
<PAGE> 78
Dated: As of December 1, 1992
AMENDED AND RESTATED
SCHEDULE D
to the Sub-Transfer Agency Agreement
between The Winsbury Service
Corporation and The Bank of California, N.A.
FEES
With respect to the Balanced Fund, the Growth Fund, the Income Equity Fund, the
Special Growth Equity Fund, the Bond Fund, the Government Bond Fund and the
Income and Growth Fund annual base fee of $12.00 per Account with respect to
the first 101 through 2999 Accounts invested in a Fund and annual base fee of
$9.00 per Account with respect to 3,000 or more Accounts invested in a Fund,
and with respect to the U.S. Government Obligations Fund, the Diversified
Obligations Fund, the 100% U.S. Treasury Obligations Fund, the Tax-Free Fund,
and the California Tax-Free Fund, annual base fee of $15.00 per Account with
respect to 101 or more Accounts invested in a Fund. The number of Accounts for
purposes of determining the base fee is calculated on a monthly basis and the
base fee shall not apply when 100 or less Accounts are invested in a Fund.
THE WINSBURY SERVICE CORPORATION
By: /s/ Ron Henderson
-------------------------
THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------------
D-1
<PAGE> 79
EXHIBIT E
CUSTODIAN AGREEMENT
This Agreement, dated as of December 23, 1991, is entered into by and
between The HighMark Group, a Massachusetts business trust having its principal
place of business in Columbus, Ohio (hereinafter called the "Group"), and The
Bank of California, N.A., a national banking association having its main office
in San Francisco, California (hereinafter called the "Custodian").
In consideration of the mutual covenants herein contained, the Group
and the Custodian agree as follows:
1. Appointment and Acceptance.
The Group hereby appoints the Custodian as custodian of all of the
securities and cash of each investment portfolio of the Group identified on
Schedule A hereto (a "Fund"), and the Custodian agrees to act as such upon the
terms and conditions herein set forth. The Group agrees to deliver to the
Custodian all securities and cash owned by a Fund, and all payments of income,
payments of principal, or capital distributions received by a Fund with respect
to all securities owned by such Fund from time to time, and the cash
consideration received by a Fund for such new or treasury units of beneficial
interest of such Fund ("Shares") as may be issued or sold from time to time.
The Custodian shall not be responsible for any property of the Group held or
received by a Fund and not delivered to the Custodian.
2. Definitions.
The word "securities" as used herein shall have the meaning stated in
Section 2(a)(36) of the Investment Company Act of 1940, as amended (the "1940
Act").
The words "proper instructions" as used herein mean a writing signed
or initialled by such one or more person or persons ("Authorized Persons") and
in such manner as the Board of Trustees of the Group shall have from time to
time authorized and whose authority, names and signatures have been most
recently certified to the Custodian by the Secretary or an Assistant Secretary
of the Group. Each such writing shall set forth the transactions involved,
including a specific statement of the purpose for which action is requested.
Payments of monies or deliveries of securities with respect to a Fund for
purposes not specifically set forth in this Agreement shall be made by the
Custodian only upon receipt of, in addition to proper instructions, a
Resolution specifying the amount of such payment or describing the securities
to
<PAGE> 80
be delivered, the purpose for which the payment or delivery is being made and
declaring such purpose to be a proper purpose of such Fund and naming the
person or persons to whom such payment or delivery is to be made. Oral
instructions will be considered proper instructions if the Custodian reasonably
believes them to have been given by Authorized Persons. The Group shall cause
all oral instructions to be confirmed in writing. Upon receipt of a Resolution
as to the authorization by the Trustees of the Group accompanied by a detailed
description of procedures approved by the Trustees, proper instructions may
include communications effected directly between electromechanical or electric
devices provided that the Trustees and the Custodian are satisfied that such
procedures afford adequate safeguards for a Fund's assets.
The word "Resolution" shall mean a copy of a resolution of the Board
of Trustees (or the executive committee) of the Group duly certified by the
Secretary or an Assistant Secretary of the Group.
The word "Depository" as used herein has the meaning as set forth in
Section 11 herein.
3. Names, Titles and Signatures.
The Group will furnish the Custodian with a Resolution indicating the
name(s) and signature(s) of the Authorized Persons from time to time authorized
to act hereunder. In the event that any person named in the most recent
Resolution shall cease to be an Authorized Person, the Group will furnish the
Custodian with a certificate of the Secretary or an Assistant Secretary
advising it to that effect. In the absence of such certificate, the Custodian
shall be entitled to rely, as aforesaid, upon the signatures of the Authorized
Persons named in the most recent Resolution.
4. Accounts.
The Custodian shall maintain an account (or accounts) on behalf of
each Fund, which may be an account (or accounts) used commonly on behalf of
only those customers for whom the Custodian acts in a fiduciary, advisory,
custodian, or other similar capacity. Such account (or accounts) with respect
to a Fund shall be subject only to draft or order by the Custodian acting
pursuant to the terms of this Agreement, and the Custodian shall hold in such
account (or accounts), subject to the provisions hereof, all cash received by
it from or for the account of such Fund other than cash maintained by such Fund
in a bank account established and used in accordance with Rule 17f-3 under the
1940 Act. Funds held by the Custodian on behalf of each Fund in such account
(or accounts) shall be at all times identifiable as such in the Custodian's
records.
Funds held by the Custodian on behalf of a Fund may be deposited by it
as Custodian for such Fund in such other banks or trust companies as it may in
its discretion deem necessary or
-2-
<PAGE> 81
desirable in accordance with the purposes and terms described herein, provided
that every such other bank or trust company shall be qualified to act as a
custodian under the 1940 Act and further provided that each such bank or trust
company and the deposit of funds with each such bank or trust company shall be
approved by vote of a majority of the Trustees of the Group as evidenced by a
Resolution. Such funds shall be deposited by the Custodian in its capacity as
Custodian and shall be withdrawable by the Custodian only in that capacity.
At the direction of the Group or its investment adviser, the Custodian
shall convert currency in a Fund's account to other currencies through
customary channels including, without limitation, the Custodian or any of its
affiliates or subsidiaries, as shall be necessary to effect any transaction
directed by the Group or its investment adviser. The Group acknowledges that
(i) the foreign currency exchange department is a part of the Custodian or one
of its affiliates or subsidiaries, (ii) a Fund is not obligated to effect
foreign currency exchange with the Custodian, (iii) the Custodian will receive
benefits for such foreign currency transactions which are in addition to the
compensation which the Custodian receives for administering the Funds, and (iv)
the Custodian will make available the relevant data so that the Group can
determine that the foreign currency exchange transactions are as favorable to a
Fund at terms generally available in arm's length transactions between
unrelated parties.
5. Collection of Income.
The Custodian shall collect all income and other payments with respect
to securities held hereunder when such securities are in the name of, or in the
process of transfer into the name of, the Custodian or a nominee of the
Custodian on the record date for such income or other payments in the case of
registered securities, or are held by the Custodian on the date of payment by
the issuer thereof in the case of bearer securities. The Custodian shall
credit all such income collected by it hereunder with respect to a Fund to the
account of such Fund. Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons and other income
items requiring presentation as and when they become due and shall collect
dividends and interest when due on securities registered in the name of the
Custodian or a nominee of the Custodian.
With respect to securities of foreign issue, while the Custodian will
use its best efforts to collect any monies which may to its knowledge become
collectible arising from such securities, including dividends, interest and
other income, and to notify the Group of any call for redemption, offer of
exchange, right of subscription, reorganization or other proceedings affecting
such securities, it is understood that the Custodian shall be under no
responsibility for any failure or delay (other than a failure or delay arising
from the Custodian's own negligence or bad faith) in effecting such collections
or giving such notices, whether or not relevant information is published in any
financial service available to it.
-3-
<PAGE> 82
The Custodian shall not be under any obligation or duty to take action
to effect collection of any amount, if the securities (domestic or foreign)
upon which such amount is payable are in default and payment is refused after
due demand or presentation. The Custodian will, however, promptly notify the
Group in writing of such default and refusal to pay.
6. Payment of Money of a Fund.
Upon receipt of proper instructions, which may be continuing
instructions when deemed appropriate by the parties, the Custodian shall pay
out monies of a Fund in the following cases only:
a. Upon the purchase of securities for the account of such
Fund but only (1) against the delivery of such securities to the Custodian (or
any bank, banking firm or trust company doing business in the United States or
abroad which is qualified under the 1940 Act to act as a custodian and has been
designated by the Custodian as its agent for this purpose in accordance with
the terms hereof) registered in the name of such Fund or in the name of a
nominee of such Fund or in the name of a nominee of the Custodian referred to
in Section 8 hereof or in proper form for transfer; (2) in the case of a
purchase effected through a Depository, in accordance with the conditions set
forth in Section 11 hereof; or (3) in the case of repurchase agreements entered
into between such Fund and a bank or a registered broker-dealer, (i) against
delivery of the securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve Bank with such
securities or (ii) against delivery of the receipt evidencing purchase by such
Fund of securities owned by the bank or the registered broker-dealer along with
written evidence of the agreement by the bank or the registered broker-dealer
to repurchase such securities from such Fund;
b. In connection with the conversion, exchange or surrender
of securities owned by such Fund as set forth in Section 7(b) hereof;
c. For the redemption or repurchase of Shares of such Fund as
set forth in Section 10 hereof;
d. For the payment of any expense or liability incurred by
such Fund, including but not limited to the following payments for the account
of such Fund: interest, taxes, management, accounting, transfer agent and legal
fees, and operating expenses of such Fund whether or not such expenses are to
be in whole or in part capitalized or treated as deferred expenses;
e. For the payment of any dividends declared with respect to
such Fund pursuant to the governing documents of the Group;
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<PAGE> 83
f. For transfer to a demand or time deposit account of such
Fund in any bank, whether domestic or foreign, or in any savings and loan
association; and
g. For any other proper purposes of such Fund, but only upon
receipt of, in addition to proper instructions, a Resolution specifying the
amount of such payment, setting forth the purpose for which such payment is to
be made, declaring such purpose to be a proper purpose of such Fund, and naming
the person or persons to whom such payment is to be made.
7. Duties of Custodian with Respect to Securities of a Fund held
by Custodian.
a. Holding Securities.
The Custodian shall hold in a separate account for each Fund, and
physically segregated at all times, except for securities held in a Depository,
from those of any other persons, firms or corporations, pursuant to the
provisions hereof, all securities received by it from or for the account of
such Fund. The Custodian shall have no power or authority to assign,
hypothecate, pledge or otherwise dispose of any securities and investments,
except pursuant to proper instructions of the Group or as otherwise provided
herein and only for the account of a Fund as hereinafter provided.
b. Delivery of Securities.
The Custodian shall release and deliver securities owned by a Fund
held by the Custodian or in a Depository account of the Custodian only upon
receipt of proper instructions, which may be continuing instructions when
deemed appropriate by the parties, and only in the following cases:
(1) Upon the sale of such securities for the account of such
Fund and receipt of payment therefor;
(2) Upon the receipt of payment in connection with any
repurchase agreement related to such securities entered into by such Fund;
(3) In the case of a sale effected through a Depository, in
accordance with the provisions of Section 11 hereof;
(4) To a Depository in connection with tender or other
similar offers for portfolio securities of such Fund;
-5-
<PAGE> 84
(5) To the issuer thereof or its agent when such securities
are called, redeemed, retired or otherwise become payable provided that, in any
such case, the cash or other consideration is to be delivered to the Custodian;
(6) To the issuer thereof, or its agent, for transfer into
the name of such Fund or into the name of any nominee or nominees of the
Custodian or into the name or nominee name of any agent appointed pursuant to
Section 9; or for exchange for a different number of bonds, certificates or
other evidence representing the same aggregate face amount or number of units;
provided that, in any such case, the new securities are to be delivered to the
Custodian;
(7) To the broker selling the same for examination in
accordance with the "street delivery" custom;
(8) For exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions for
conversion contained in such securities, or pursuant to any deposit agreement;
provided that, in any such case, the new securities and cash, if any, are to be
delivered to the Custodian;
(9) In the case of warrants, rights or similar securities,
the surrender thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or temporary securities for
definitive securities; provided that, in any such case, the new securities and
cash, if any, are to be delivered to the Custodian;
(10) For delivery in connection with any loans of securities
made by such Fund, but only against receipt of adequate collateral as agreed
upon from time to time by the Custodian and such Fund, which may be in the form
of cash, obligations issued by the United States Government, its agencies or
instrumentalities, or other securities as permitted in accordance with the
terms of the current Prospectus of such Fund;
(11) For delivery as security in connection with any
borrowings by such Fund requiring a pledge of assets by such Fund, but only
against receipt of amounts borrowed by the Custodian except where additional
collateral is being pledged on an outstanding loan; or
(12) For any other proper purposes of such Fund, but only upon
receipt of, in addition to proper instructions, a Resolution specifying the
securities to be delivered, setting forth the purpose for which such delivery
is to be made, declaring such purposes to be proper purposes of such Fund, and
naming the person or persons to whom delivery of such securities shall be made.
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<PAGE> 85
8. Registration of Securities.
Securities held by the Custodian (other than bearer securities) on
behalf of a Fund shall be registered in the name of such Fund or in the name of
any nominee of such Fund or of any nominee of the Custodian which nominee shall
be assigned exclusively to such Fund, unless the Group has authorized in
writing the appointment of a nominee to be used in common with other registered
investment companies having the same investment adviser as such Fund or in
common exclusively with other accounts for which the Custodian acts in a
fiduciary, advisory, custodial, or other similar capacity, or in the name or
nominee name of any agent appointed pursuant to Section 9 or in the name of any
nominee or nominees used by a Depository. All securities accepted by the
Custodian on behalf of a Fund under the terms of this Contract shall be in
"street" or other good delivery form. The Custodian shall use its best efforts
to the end that the specific securities held by the Custodian on behalf of each
Fund shall be at all times identifiable as such in the Custodian's records.
9. Appointment of Agents.
Subject to the provisions of Section 12 hereof, the Custodian may at
any time or times in its discretion appoint (and may at any time remove) any
other bank (as defined in the 1940 Act) as its agent or subcustodian to carry
out such of the provisions of this Agreement as the Custodian may from time to
time direct; provided, however, that the appointment of any agent shall not
relieve the Custodian of any of its responsibilities or liabilities hereunder.
10. Payments for Redemption or Repurchase of Shares of a Fund.
From such funds as may be available for the purpose, but subject to
the limitations of the Declaration of Trust and Code of Regulations of the
Group and any applicable votes of the Trustees of the Group pursuant thereto,
the Custodian shall, upon receipt of instructions from the Transfer Agent for a
Fund, make funds available for payment to holders of Shares ("Shareholders") of
such Fund who have delivered to the Transfer Agent a request for redemption or
repurchase of their Shares. In connection with the redemption or repurchase of
Shares of a Fund, the Custodian is authorized upon receipt of instructions from
the Transfer Agent to wire funds to a commercial bank designated by a redeeming
Shareholder.
11. Deposit of a Fund's Assets in a Depository.
The Custodian may deposit and/or maintain securities owned by a Fund
in (i) a foreign securities depository or clearing agency in accordance with
Rule 17f-5 of the 1940 Act, (ii) a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities Exchange
Act of 1934 which acts as a securities depository, and (iii) the book-entry
system as provided in Subpart O of Treasury Circular No. 300, 31 C.F.R. 306,
-7-
<PAGE> 86
Subpart B of 31 C.F.R. Part 350, and the book-entry regulations of federal
agencies substantially in the form of Subpart O; provided in each case that
such deposit and/or maintenance complies with all applicable provisions of Rule
17f-4 under the 1940 Act, as such Rule may from time to time be amended (each a
"Depository"). The Group shall furnish the Custodian with a Resolution
evidencing the approval by the Group of the use of a Depository by the
Custodian. The Board of Trustees of the Group shall review, at least annually,
the use of a Depository with respect to this Agreement.
Without limiting the generality of the foregoing regarding the use of
such Depository, it is agreed that the following provisions shall apply
thereto:
a. The Custodian shall deposit and/or maintain the securities
in an account of the Custodian in the Depository that shall not include any
assets of the Custodian other than assets held by it for customers;
b. The Custodian shall send the Group a confirmation of any
transfers to or from the account of a Fund. Where securities are transferred
to that account, the Custodian shall also, by book entry or otherwise, identify
as belonging to such Fund a quantity of securities in a fungible bulk of
securities (1) registered in the name of the Custodian (or its nominee) or (2)
shown on the Custodian's account on the books of the Depository;
c. The Custodian shall pay for securities purchased for the
account of a Fund upon (1) receipt of advice from the Depository that such
securities have been transferred to the account, and (2) the making of an entry
on the records of the Custodian to reflect such payment and transfer for the
account of such Fund. The Custodian shall transfer securities sold for the
account of a Fund upon (1) receipt of advice from the Depository that payment
for such securities has been transferred to the account, and (2) the making of
an entry on the records of the Custodian to reflect such transfer and payment
for the account of such Fund. Copies of all advices from the Depository of
transfers of securities for the account of a Fund shall identify such Fund as
well as the Group, be maintained for such Fund by the Custodian and be provided
to the Group at its request. The Custodian shall furnish the Group
confirmation of each transfer to or from the account of a Fund in the form of a
written advice or notice and shall furnish to the Group copies of daily
transaction sheets reflecting each day's transactions in the Depository for the
account of a Fund on the next business day;
d. The Custodian shall promptly send to the Group reports it
receives from the Depository on its system of internal accounting control. The
Custodian shall send to the Group such reports on its own system of internal
accounting control as the Group may reasonably request from time to time;
-8-
<PAGE> 87
e. The Custodian shall comply with all other conditions which
may be imposed from time to time by statute or by appropriate rules and
regulations on the use of a Depository with respect to the securities of a
Fund; and
f. Anything to the contrary in this Agreement
notwithstanding, the Custodian shall be liable to a Fund for any loss or damage
to such Fund resulting from the use of a Depository by reason of any negligence
or misfeasance of the Custodian or any of its agents or its employees or from
any failure of the Custodian or any such agent to pursue diligently such rights
as it may have against such Depository; at the election of a Fund, it shall be
entitled to be subrogated to the rights of the Custodian with respect to any
claim against the Depository or any person which the Custodian may have as a
consequence of any such loss or damage if and to the extent that such Fund has
not been made whole for any such loss or damage. Furthermore, the Custodian
shall be fully responsible for any loss suffered by a Fund as a result of any
act or failure to act on the part of a Depository, to the same extent that the
Custodian would have been liable had the Custodian taken or failed to take such
action with respect to securities of such Fund entrusted to its custody.
Without, in any way, limiting the generality of the foregoing, the Custodian
shall be responsible for the safe custody of the securities held in such
Depository, to the same extent as if the Custodian held physical possession of
such securities.
12. Use of Foreign Subcustodians and Foreign Depositories.
Subject to the provisions of this Section 12, the Custodian may, in
connection with the purchase and sale by a Fund of securities outside the
United States, appoint in writing (and may at any time remove) any foreign
banking institution, trust company, or other entity which is qualified to act
as a foreign custodian under Rule 17f-5 of the 1940 Act (a "Foreign
Sub-Custodian") or any Depository which is a foreign securities depository or
clearning agency which is qualified to act as such under Rule 17f-5 of the 1940
Act (a "Foreign Depository"), to carry out, in accordance with the terms of
this Agreement, such of the provisions of the Agreement as the Custodian may,
from time to time, direct; provided, however, that such Foreign Subcustodian or
Foreign Depository (which itself would meet the qualifications for a successor
custodian set forth in Section 18 is understood to be the agent of the
Custodian and not the agent of such Fund, and the Custodian shall be fully
responsible for the acts of such Foreign Subcustodian or Foreign Depository and
shall not be relieved of any of its responsibilities hereunder by the
appointment of such Foreign Subcustodian or Foreign Depository.
a. The Custodian shall exercise reasonable care in the
selection of any Foreign Subcustodian or Foreign Depository. In making its
selection, the Custodian shall consider (i) the Foreign Subcustodian's or
Foreign Depository's financial strength, general reputation and standing in the
country in which it is located, its ability to provide efficiently the
custodian services required and the relative cost of such services, (ii)
whether the Foreign Subcustodian or
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<PAGE> 88
Foreign Depository would provide a level of safeguards for safekeeping and
custody of securities not materially different from those prevailing in the
United States, (iii) whether the Foreign Subcustodian or Foreign Depository has
branch offices in the United States in order to facilitate jurisdiction over
and enforcement of judgments against it, and (iv) in the case of a Foreign
Depository, the number of its participants and its operating history.
b. The Custodian shall give notice to the Group of its
intention to deposit securities with a Foreign Subcustodian or (directly or
through a Foreign Subcustodian) with a Foreign Depository. The notice shall
identify the proposed Foreign Subcustodian or Foreign Depository and shall
include reasonably available information relied on by the Custodian in making
the selection and, where applicable, a copy of the proposed form of agreement
with the Foreign Subcustodian or Foreign Depository.
c. Within 30 days of its receipt of a notice from the
Custodian pursuant to paragraph 12(b) of this Agreement regarding the
Custodian's proposed selection of one or more Foreign Subcustodians or Foreign
Depositories, the Group shall give written notice to the Custodian of the
Group's approval or disapproval of the proposed selection.
d. The Custodian shall evaluate and determine at least
annually the continued eligibility of each Foreign Subcustodian and Foreign
Depository approved by the Group to act as such hereunder. In discharging this
responsibility, the Custodian shall (i) monitor continuously the day-to-day
services and reports provided by each Foreign Subcustodian or Foreign
Depository, (ii) at least annually, obtain and review the annual financial
report published by such Foreign Subcustodian or Foreign Depository and any
reports on such Foreign Subcustodian or Foreign Depository prepared by a
reputable independent analyst, and (iii) at least triennially, physically
inspect the operations of such Foreign Subcustodian or Foreign Depository.
e. If the Custodian determines that any Foreign Subcustodian
or Foreign Depository no longer satisfies the applicable requirements under
Rule 17f-5 of the 1940 Act to serve as such or is otherwise no longer capable
or qualified to perform the functions contemplated herein, the Custodian shall
promptly give written notice thereof to the Group. The notice shall, in
addition, either (i) indicate the Custodian's intention to transfer securities
held by the removed Foreign Subcustodian or Foreign Depository to another
Foreign Subcustodian or Foreign Depository previously approved by the Group, or
(ii) include a notice pursuant to paragraph 12(b) of this Agreement of the
Custodian's intention to deposit securities with a new Foreign Subcustodian or
Foreign Depository.
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<PAGE> 89
13. Use of Euro-clear Securities Clearance Facilities.
A Fund may, from time to time, with respect to securities purchased or
sold by such Fund in Europe, if any, wish to use the Euro-clear Securities
Clearance Facilities. In such cases, a Foreign Subcustodian of the Custodian
employed pursuant to Section 12 may, notwithstanding the other provisions of
this Agreement:
a. make payments of cash upon the purchase of securities for
the account of such Fund prior to delivery of such securities to the Foreign
Subcustodian; and
b. deliver securities upon sales of such securities for the
account of such Fund prior to receipt by the Foreign Subcustodian of payment
therefor;
provided that any such transactions shall be implemented in accordance with
procedures agreed to in advance in writing by the Group, the Custodian and such
Foreign Subcustodian.
14. Voting and Other Action.
The Custodian shall promptly deliver or mail to the Group all forms of
proxies and all notices of meetings and other notices or announcements
affecting or relating to the securities of a Fund, and, upon receipt of proper
instructions, shall execute and deliver or cause its nominee to execute and
deliver such proxies or other authorizations as may be required. Neither the
Custodian nor its nominee shall vote upon any of the securities or execute any
proxy to vote thereon or give any consent to take any other action with respect
thereto (except as otherwise herein provided) unless ordered to do so by proper
instructions.
15. Transfer Tax and Other Disbursements.
A Fund shall pay or reimburse the Custodian from time to time for any
transfer taxes payable upon transfers of securities made hereunder, and for all
other necessary and proper disbursements and expenses made or incurred by the
Custodian in the performance of this Agreement; provided that, with the
exception of such transfer taxes, a Fund shall not pay or reimburse the
Custodian for any disbursements or expenses made or incurred in connection with
the use by the Custodian of a Depository.
The Custodian shall execute and deliver and shall cause any Depository
to execute and deliver such certificates in connection with securities
delivered to it or by it under this Agreement as may be required under the laws
of any jurisdiction to exempt from taxation any exemptible transfers and/or
deliveries of any such securities. The Custodian shall use reasonable efforts
to obtain refunds of taxes withheld on securities or the income thereof that
are available under applicable tax laws, treaties, and regulations.
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<PAGE> 90
16. Responsibility of Custodian and Indemnification.
The Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Agreement and shall be held harmless in acting
upon proper instructions, Resolutions, any notice, request, consent,
certificate or other instrument reasonably believed by it to be genuine and to
be signed by the proper party or parties and shall be entitled to receive as
conclusive proof of any fact or matter required to be ascertained by it
hereunder, a certificate signed by the President, a Vice President, the
Treasurer, the Secretary or an Assistant Secretary of the Group. The Custodian
may receive and accept a Resolution as conclusive evidence (a) of the authority
of any person to act in accordance with such vote or (b) of any determination
or of any action by the Board of Trustees pursuant to the Declaration of Trust
or the Code of Regulations of the Group as described in such vote, and such
vote may be considered as in full force and effect until receipt by the
Custodian of written notice from the Secretary or an Assistant Secretary to the
contrary.
The Custodian shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for the Group) on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to such advice.
The Custodian shall be held to the exercise of reasonable care in
carrying out the provisions of this Agreement but shall be liable only for its
own negligent or bad faith acts or failures to act. A Fund shall indemnify the
Custodian and hold it harmless from and against all claims, liabilities, and
expenses (including attorneys' fees) with respect to such Fund which the
Custodian may suffer or incur on account of being Custodian hereunder except
such claims, liabilities, and expenses arising from the Custodian's own
negligence or bad faith.
If a Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Custodian, result in the Custodian or its nominee assigned
to such Fund being liable for the payment of money or incurring liability of
some other form, such Fund, as a prerequisite to requiring the Custodian to
take such action, shall provide indemnity to the Custodian in an amount and
form satisfactory to it.
17. Effective Period, Termination and Interpretive and Additional
Provisions.
This Agreement shall become effective with respect to a Fund as of the
date first written above and, unless sooner terminated as provided herein,
shall continue in effect until October 31, 1993. Thereafter, if not
terminated, this Agreement shall continue in effect as to a particular Fund for
successive periods of twelve months each ending on October 31st of each year,
provided such continuance is specifically approved at least annually (a) by the
vote of a majority of those members of the Group's Board of Trustees who are
not parties to this
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<PAGE> 91
Agreement or interested persons (as defined in the Investment Company Act of
1940) of any party to this Agreement, cast in person at a meeting called for
the purpose of voting on such approval, and (b) by the vote of a majority of
the Group's Board of Trustees or by the vote of a majority of the outstanding
voting securities of such Fund.
This Agreement may be terminated with respect to a Fund at any time,
without the payment of any penalty, by an instrument in writing either
delivered or mailed, postage prepaid, to the other party, such termination to
take effect not sooner than sixty (60) days after the date of such delivery or
mailing; provided, however, that the Group shall not terminate this contract in
contravention of any applicable Federal or state regulations, or any provisions
of the Declaration of Trust and the Code of Regulations of the Group as the
same may from time to time be amended, and further provided, that the Group may
at any time by action of its Board of Trustees substitute with respect to a
Fund another bank or trust company for the Custodian by giving notice as above
to the Custodian.
Upon termination hereof the Custodian shall be entitled to such
compensation as may be due it as of the date of such termination and shall
likewise be entitled to reimbursement for its costs, expenses, and
disbursements and as provided herein. In the event of termination of the
Agreement and for so long as the Custodian, with the written consent of the
Group, in fact continues to perform any one or more of the services
contemplated by this Agreement or any Schedule hereto, the provisions of this
Agreement shall continue in full force and effect.
This Agreement may be amended with respect to a Fund at any time by
mutual agreement of the parties hereto in writing; provided, however, that this
Agreement may not be amended in contravention of any applicable Federal or
state regulations, or any provisions of the Declaration of Trust and the Code
of Regulations of the Group as the same may from time to time be amended.
The Group or its authorized representatives shall have reasonable
access to inspect books and records maintained by the Custodian or any agent,
Foreign Subcustodian or Depository holding securities hereunder to verify the
accuracy of such books and records. The Custodian shall notify the Group
promptly of any applicable law or regulation in any country where securities
are held that would restrict such access or inspection.
In connection with the operation of this Agreement, the Custodian and
the Group may, with respect to a Fund, agree from time to time on such
provisions interpretive of or in addition to the provisions of this Agreement
as may in their joint opinion be consistent with the general tenor of this
Agreement, any such interpretive or additional provisions to be signed by both
parties and annexed hereto, provided that no such interpretive or additional
provisions shall contravene any applicable Federal or state regulations, or any
provisions of the Declaration of Trust and Code of Regulations of the Group as
the same may from time to time be amended.
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<PAGE> 92
No interpretive or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Agreement.
18. Successor Custodian.
If a successor custodian is appointed with respect to a Fund by the
Board of Trustees of the Group, the Custodian shall, upon termination, deliver
to such successor custodian at the office of the Custodian, duly endorsed and
in form for transfer, all securities then held hereunder and all funds or other
properties of such Fund deposited with or held by it hereunder.
If no such successor custodian is appointed, the Custodian shall, in
like manner, at its office, upon receipt of a certified copy of a vote of the
Shareholders of such Fund, deliver such securities, funds and other properties
in accordance with such vote.
In the event that no written order designating a successor custodian
or certified copy of a vote of the Shareholders of such Fund shall have been
delivered to the Custodian on or before the date when such termination shall
become effective, then the Custodian shall have the right to deliver to a bank
or trust company of its own selection qualified to act as a custodian under the
1940 Act, having an aggregate capital, surplus, and undivided profits, as shown
by its last published report, of not less than $20,000,000, all securities,
funds, and other properties held by the Custodian on behalf of such Fund and
all instruments held by it relative thereto and all other property held by it
with respect to such Fund under this Agreement. Thereafter such bank or trust
company shall be the successor of the Custodian with respect to such Fund under
this Agreement.
In the event that securities, funds, and other properties remain in
the possession of the Custodian after the date of termination hereof owing to
the failure of the Group to procure the certified copy above referred to, or of
the Trustees to appoint a successor custodian, the Custodian shall be entitled
to fair compensation for its services during such period and the provisions of
this Agreement relating to the duties and obligation of the Custodian shall
remain in full force and effect.
19. Compensation of Custodian.
The Custodian shall be entitled to compensation for its services and
expenses as Custodian for the assets of a Fund as described on Schedule B
hereto.
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<PAGE> 93
20. Massachusetts Law to Apply.
This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.
21. Matters Relating to the Group as a Massachusetts Business
Trust.
The names 'The HighMark Group' and 'Trustees of The HighMark Group'
refer respectively to the Trust created and the Trustees, as trustees but not
individually or personally, acting from time to time under a Declaration of
Trust dated as of March 10, 1987 to which reference is hereby made and a copy
of which is on file at the office of the Secretary of The Commonwealth of
Massachusetts and elsewhere as required by law and to any and all amendments
thereto so filed or hereafter filed. The obligations of 'The HighMark Group'
entered into in the name or on behalf thereof by any of the Group's Trustees,
representatives or agents are made not individually, but in such capacities,
and are not binding upon any of the Trustees, Shareholders, representatives, or
agents of the Trust personally, but bind only the assets of the Trust, and all
persons dealing with any series of Shares of the Trust must look solely to the
assets of the Trust belonging to such series for the enforcement of any claims
against the Trust.
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized officers and its seal
to be hereunto affixed as of the day first written above.
[SEAL] THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
--------------------------
Title: Vice President
--------------------------
[SEAL] THE HIGHMARK GROUP
By: /s/ Kenneth B. Quintenz
--------------------------
Title: President
--------------------------
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<PAGE> 94
Dated: As of December 1, 1992
AMENDED AND RESTATED
Schedule A
to the Custodian Agreement
between The HighMark Group and
The Bank of California, N.A.
Name of Fund
The U.S. Government Obligations Fund
The Diversified Obligations Fund
The 100% U.S. Treasury Obligations Fund
The Balanced Fund
The Growth Fund
The Income Equity Fund
The Special Growth Equity Fund
The Bond Fund
The Tax-Free Fund
The California Tax-Free Fund
The Government Bond Fund
The Income and Growth Fund
[SEAL] THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------------
Title: Vice President
-------------------------
A-1
<PAGE> 95
[SEAL] THE HIGHMARK GROUP
By: /s/ S. Mintos
-------------------------
Title: President
-------------------------
A-2
<PAGE> 96
Schedule B
to the Custodian Agreement
between The HighMark Group and
The Bank of California, N.A.
December 23, 1991
Each Fund shall pay the Custodian a fee at an annual rate of .02% of
the Fund's average daily net assets, with a minimum annual fee of $2,500. The
Custodian shall also be entitled to be reimbursed by each Fund for its
reasonable out-of-pocket expenses incurred in the performance of its duties
under the Agreement. In addition, the Custodian will be entitled to receive
from each Fund the following fees as specified:
<TABLE>
<S> <C>
Transaction Charges:
- -------------------
Depository Eligible $17.00
Depository Ineligible $40.00
Annual Holding Charges:
- ----------------------
Depository Eligible $25.00
Depository Ineligible $40.00
Disbursement Charges: $10.00
- --------------------
</TABLE>
[SEAL] THE BANK OF CALIFORNIA, N.A.
By: /s/ Greg King
-------------------------
Title: Vice President
-------------------------
[SEAL] THE HIGHMARK GROUP
By: /s/ Kenneth B. Quintenz
-------------------------
Title: President
-------------------------
B-1
<PAGE> 97
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK GROWTH FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -----------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
GROWTH FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Growth Fund (the "Fund"), a portfolio of The HighMark Group, to be held at the
offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219
at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in respect of
all Shares of the Fund as to which the undersigned may be entitled to vote or
act. Each proxy shall have power of substitution and a majority of said
proxies or their substitutes, or any one if only one be present and acting,
shall have all powers hereby granted.
<PAGE> 98
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies shall vote FOR
such proposal. The proxies may vote in their discretion on any other matter
which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the
Sub-Administration Agreement, the
Sub-Transfer Agency Agreement and the
Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the
list below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 99
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK INCOME AND GROWTH FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
INCOME AND GROWTH FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Income and Growth Fund (the "Fund"), a portfolio of The HighMark Group, to be
held at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 100
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 101
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK INCOME EQUITY FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
INCOME EQUITY FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Income Equity Fund (the "Fund"), a portfolio of The HighMark Group, to be held
at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio
43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 102
shall vote FOR such proposal. The proxies may vote in their discretion on
any other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 103
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK BALANCED FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
BALANCED FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Balanced Fund (the "Fund"), a portfolio of The HighMark Group, to be held at
the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio
43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 104
shall vote FOR such proposal. The proxies may vote in their discretion on
any other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent accountants __ __ __
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 105
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK BOND FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
BOND FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Bond Fund (the "Fund"), a portfolio of The HighMark Group, to be held at the
offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219
at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in respect of
all Shares of the Fund as to which the undersigned may be entitled to vote or
act. Each proxy shall have power of substitution and a majority of said
proxies or their substitutes, or any one if only one be present and acting,
shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 106
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 107
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -------------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK GOVERNMENT BOND FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
GOVERNMENT BOND FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Government Bond Fund (the "Fund"), a portfolio of The HighMark Group, to be
held at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 108
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 109
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -------------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK DIVERSIFIED OBLIGATIONS FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
DIVERSIFIED OBLIGATIONS FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Diversified Obligations Fund (the "Fund"), a portfolio of The HighMark Group,
to be held at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road,
Columbus, Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all adjournments
thereof, in respect of all Shares of the Fund as to which the undersigned may
be entitled to vote or act. Each proxy shall have power of substitution and a
majority of said proxies or their substitutes, or any one if only one be
present and acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 110
shall vote FOR such proposal. The proxies may vote in their discretion on
any other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-Administration
Agreement, the Sub-Transfer Agency Agreement and the
Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 111
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -------------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK U.S. GOVERNMENT OBLIGATIONS FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -----------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
U.S. GOVERNMENT OBLIGATIONS FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
U.S. Government Obligations Fund (the "Fund"), a portfolio of The HighMark
Group, to be held at the offices of BISYS Fund Services, Inc., 3435 Stelzer
Road, Columbus, Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all
adjournments thereof, in respect of all Shares of the Fund as to which the
undersigned may be entitled to vote or act. Each proxy shall have power of
substitution and a majority of said proxies or their substitutes, or any one if
only one be present and acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 112
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 113
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -----------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK 100% U.S. TREASURY OBLIGATIONS FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -----------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
100% U.S. TREASURY OBLIGATIONS FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
100% U.S. Treasury Obligations Fund (the "Fund"), a portfolio of The HighMark
Group, to be held at the offices of BISYS Fund Services, Inc., 3435 Stelzer
Road, Columbus, Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all
adjournments thereof, in respect of all Shares of the Fund as to which the
undersigned may be entitled to vote or act. Each proxy shall have power of
substitution and a majority of said proxies or their substitutes, or any one if
only one be present and acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 114
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 115
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -------------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK CALIFORNIA TAX-FREE FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
CALIFORNIA TAX-FREE FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
California Tax-Free Fund (the "Fund"), a portfolio of The HighMark Group, to be
held at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 116
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
<PAGE> 117
THE HIGHMARK GROUP
P.O. Box 759, San Francisco, CA 94120
- -------------------------------------------------------------------------------
IMPORTANT PROXY
[ADDRESS] PLEASE FILL OUT AND SIGN PROXY TODAY.
PLEASE DETACH PROXY BELOW AND RETURN USING THE
ENCLOSED SELF-ADDRESSED RETURN ENVELOPE.
THIS PROXY APPLIES TO THE ACCOUNTS LISTED BELOW
THE HIGHMARK TAX-FREE FUND
[Account Number] Number of shares owned
[_________]
PLEASE DO NOT HESITATE TO CONTACT
THE HIGHMARK GROUP AT 1-800-433-6884
SHOULD YOU HAVE ANY QUESTIONS
THIS IS YOUR PROXY
DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- -------------------------------------------------------------------------------
[Account Number] THE HIGHMARK GROUP [________]
TAX-FREE FUND
Proxy for Special Meeting of Shareholders - March 11, 1996
The undersigned hereby appoints Stephen G. Mintos and Cynthia L.
Lindsey proxies to vote and act at the Special Meeting of Shareholders of the
Tax-Free Fund (the "Fund"), a portfolio of The HighMark Group, to be held at
the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio
43219 at 9:00 a.m. on March 11, 1996 and at all adjournments thereof, in
respect of all Shares of the Fund as to which the undersigned may be entitled
to vote or act. Each proxy shall have power of substitution and a majority of
said proxies or their substitutes, or any one if only one be present and
acting, shall have all powers hereby granted.
The proxies are hereby authorized and instructed to vote upon the
matters specified in the notice of meeting as set forth on this side of this
proxy. If no choice is indicated as to a proposal, the proxies
<PAGE> 118
shall vote FOR such proposal. The proxies may vote in their discretion on any
other matter which may properly come before the meeting.
<TABLE>
<S> <C> <C> <C> <C>
(1) Proposal to approve the proposed New FOR AGAINST ABSTAIN
Investment Advisory Agreement, and __ __ __
to ratify the continuation of the Sub-
Administration Agreement, the
Sub-Transfer Agency Agreement and
the Custodian Agreement.
</TABLE>
(2) Election of Trustees
__ FOR all nominees listed except as marked to the contrary
below.
__ WITHHOLD AUTHORITY for all nominees
INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the name in the list
below.
<TABLE>
<S> <C> <C>
Thomas J. Braje Joseph C. Jaeger Stephen G. Mintos
David A. Goldfarb Frederick J. Long
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
(3) Proposal to ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as independent __ __ __
accountants
(4) Transaction of such other business as FOR AGAINST ABSTAIN
may properly come before the meeting __ __ __
or any adjournment thereof.
</TABLE>
Please sign and return.
The proxies are hereby instructed to vote as specified.
x______________________ x______________________ DATED: _____________, 1996
(Sign here exactly as name(s) appear above.
NOTE: Signature(s) should agree with name(s) as printed hereon. All joint
owners should sign. Fiduciaries please indicate their titles. This proxy is
solicited on behalf of the Board of Trustees of The HighMark Group. Please
sign and return promptly in the enclosed envelope.
-2-
