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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
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
HighMark Funds
One Freedom Valley Drive
Oaks, PA 19456
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(Name of Registrant as Specified in its Charter)
Martin E. Lybecker, Esq.
Ropes & Gray
1301 K Street, N.W., Suite 800 East
Washington, D.C. 20005
------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies: 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 (set forth the amount on which the
filing is calculated and state how it was determined): N/A
4) Proposed maximum aggregate value of transaction: N/A
5) Total fee paid: N/A
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
Notes:
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IMPORTANT SHAREHOLDER INFORMATION
HighMark Funds
The document you hold in your hands contains your proxy statement and proxy
card. A proxy card is, in essence, a ballot. When you vote your proxy, it tells
us how to vote on your behalf on important issues relating to your Fund. The
proxy card may be completed by checking the appropriate box voting for or
against the specific proposals relating to your Fund. If you simply sign the
proxy without specifying a vote, your shares will be voted in accordance with
the recommendations of the Board of Trustees.
We urge you to take the time to read the proxy statement, fill out the proxy
card, and return it to us. Voting your proxy, and doing so promptly, ensures
that the Funds will not need to conduct additional mailings. When shareholders
do not return their proxies in sufficient numbers, we will incur the expense of
follow-up solicitations.
Please take a few moments to exercise your right to vote. Thank you.
(Front Cover of Proxy Package)
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HIGHMARK FUNDS
Notice of Special Meeting of Shareholders of
the HighMark Convertible Securities Fund
to be held December 18, 1998
A Special Meeting of the shareholders of the HighMark Convertible
Securities Fund (the "Fund"), will be held at 3:30 p.m., Eastern time, at the
offices of HighMark Funds, at One Freedom Valley Drive, Oaks, Pennsylvania 19456
on December 18, 1998 for the following purposes:
1. Liquidation. To consider the liquidation of the Fund's assets. All
liquidated assets minus outstanding liabilities and taxes to be distributed
pro rata to the Fund's shareholders and, thereafter, the Fund to be
terminated.
2. To transact such other business as may properly come before the meeting or
any adjournment thereof.
The Board of Trustees has fixed September 30, 1998 as the record date
for determination of shareholders entitled to vote at this Special Meeting.
By Order of the Trustees
Kevin P. Robins
Secretary
November 12, 1998
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY CARD IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
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To HighMark Convertible Securities Fund Shareholders:
The purpose of this proxy package is to announce that a Shareholder Meeting (the
"Meeting") for the HighMark Convertible Securities Fund (the "Fund") has been
scheduled for Friday, December 18, 1998. The purpose of this Meeting is to
submit a very important matter regarding the future of the Fund to the
Shareholders for a vote.
After considering the small asset size of the Fund and the lack of prospects for
growth in asset size and new shareholders, the Trustees of HighMark Funds
concluded that among all of the available alternatives it would be in the best
interests of the Fund's Shareholders to liquidate and distribute the Fund's
assets and then terminate the Fund. The attached proxy statement is designed to
give you information relating to the proposal on which you will be asked to
consider and vote.
While you are, of course, welcome to join us at the Meeting, most Shareholders
cast their votes by filling out and signing the enclosed proxy card. In order to
conduct the Meeting a majority of shares must be represented either in person or
by proxy. Whether or not you plan to attend the Meeting, we need your vote.
Please mark, sign and date the enclosed proxy card and return it promptly in the
enclosed, postage-paid envelope so that the maximum number of shares may be
voted.
We encourage you to read the enclosed proxy statement thoroughly. In addition,
we have included on the next page a list of some commonly asked questions and
answers. If you have any additional questions, please call your account
administrator, investment representative, or HighMark Funds directly at
1-800-433-6884.
Your vote is very important to us. As always, we thank you for your confidence
and support.
Sincerely,
/s/ Mark E. Nagle
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Mark E. Nagle
President
HighMark Funds
PLEASE SIGN AND RETURN THE ENCLOSED PROXY BALLOT CARD
YOUR VOTE IS VERY IMPORTANT
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Q. WHY IS THE BOARD OF TRUSTEES PROPOSING TO CLOSE THE CONVERTIBLE
SECURITIES FUND?
A. As part of a wide ranging effort to maximize efficiencies in the
HighMark Funds, serious consideration was given to the future of the
HighMark Convertible Securities Fund. After considering a variety of
options, the Board of Trustees of HighMark Funds determined that many
factors limited the prospects for long-term growth of the Fund. Poor
prospects for growth in asset levels means that it is unlikely that the
Fund will achieve adequate economies of scale and be the optimally
efficient investment vehicle for shareholder assets for which it was
originally designed.
Q. WHAT WILL HAPPEN TO MY INVESTMENT IN THE CONVERTIBLE SECURITIES FUND IF
THIS PROPOSAL IS APPROVED?
A. The assets in the Fund will be liquidated, the proceeds will be
distributed to shareholders and the Fund will be terminated on December
31, 1998 or as soon thereafter as is operationally feasible. YOU WILL
HAVE UNTIL DECEMBER 30TH TO FIND AN ALTERNATIVE INVESTMENT VEHICLE FOR
YOUR ACCOUNT. Your account representative can assist you in this
process. Any assets that remain invested in the Fund on its termination
date will be liquidated and the proceeds will be remitted to you or
your representative.
Q. ARE THERE ANY ALTERNATIVE INVESTMENT OPTIONS AVAILABLE TO ME?
A. Yes. There are a variety of alternative investment options available to
shareholders of the Convertible Securities Fund. Because of the
importance of meeting your precise investment needs, no specific
recommendations for alternative investment options are provided with
this proxy package. You are encouraged to contact your account
representative to discuss these alternative investment options.
Q. WHAT IF I DO NOT RETURN MY PROXY VOTING BALLOT?
A. In order to conduct the Shareholder Meeting a quorum must be present,
in person or by proxy. A quorum is defined as representation of over
50% of the shares outstanding for the Fund as of September 30, 1998. In
the event that not enough shareholders return the enclosed proxy ballot
card to achieve quorum, we will be forced to incur additional expense
associated with additional solicitations. In order to avoid additional
costs, please return the completed proxy ballot as soon as possible.
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Q. HOW DOES THE BOARD SUGGEST THAT I VOTE?
A. After careful consideration, the Board of Trustees of HighMark Funds,
including the independent members, recommends that you vote "FOR" all
of the items on the enclosed proxy ballot. The Board also wishes to
remind you to vote and return all the proxy ballot cards you receive.
Q. WHO SHOULD I CALL WITH QUESTIONS ABOUT THIS PROXY?
A. If you have any questions regarding this proxy, please contact your
account administrator, investment representative, or HighMark Funds
directly at 1-800-433-6884.
THE INFORMATION PROVIDED IN THIS "Q&A" IS SUPPORTED
BY DISCLOSURES CONTAINED IN THE ACCOMPANYING PROXY STATEMENT
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HIGHMARK FUNDS
PROXY STATEMENT
---------------
The enclosed proxy is solicited on behalf of the Board of Trustees (the
"Trustees") of HighMark Funds with respect to the HighMark Convertible
Securities Fund (the "Fund"). The proxy is revocable at any time before it is
voted by sending written notice of the revocation to the Funds or by appearing
personally at the December 18, 1998 special meeting of shareholders of the Fund
(the "Special Meeting").
Only shareholders of record at the close of business on September 30,
1998 will be entitled to vote at the Special Meeting. As of September 30, 1998,
there were issued and outstanding 2,554,318.423 Shares of the Fund, each Share
being entitled to one vote, and each fractional Share being entitled to a
proportionate fractional vote. Shareholders will vote on the liquidation
proposal and on any other business as may properly come before the Special
Meeting.
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 Funds' current executive offices are located at One Freedom Valley
Drive, Oaks, Pennsylvania 19456. This proxy statement and the enclosed notice of
meeting and proxy card are first being mailed on or about November 12, 1998.
A copy of the Funds' Annual Report dated July 31, 1998 is available
upon request and may be obtained by calling 1-800-433-6884.
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THE PROPOSAL
APPROVAL OR DISAPPROVAL OF THE
LIQUIDATION OF THE FUND'S ASSETS
--------------------------------
This Special Meeting is being called for the purpose of approving the
liquidation of the Fund's assets. The Trustees have determined that it is in the
Fund's and its shareholders' best interests for the Fund to liquidate its assets
and then distribute pro rata to shareholders all of the liquidation proceeds
(net of outstanding liabilities and taxes). Thereafter, the Trustees will wind
up the affairs of, and terminate, the Fund.
The Trustees considered the small asset size of the Fund and the lack
of prospects for growth in asset size and new shareholders as important factors
in reaching this determination. The Trustees also determined that the Fund was
unlikely to reach levels of adequate economies of scale, which, in essence,
means it is unlikely that the Fund will ever be an optimally efficient
investment vehicle for shareholder assets.
The Trustees considered alternatives to liquidating and terminating the
Fund, such as merging it into another fund or funds. The Trustees concluded
that, among all of the available alternatives presented to and considered by the
Trustees, for a variety of reasons the liquidation alternative was in the best
interest of the Fund's shareholders. The other alternatives did not guarantee an
efficient or efficacious manner of protecting each shareholder's interests. For
example, in considering the possibility of a merger, the Trustees determined
that it was not possible to merge with a suitable candidate (giving due
consideration to possible candidates' investment objectives and policies and
expense ratios) without subjecting Fund shareholders to undesirable tax
consequences.
After due deliberation, on September 23, 1998, the Trustees unanimously
approved the liquidation of the Fund's assets and determined that the proper
time had come to present the issue to shareholders. Pursuant to HighMark Funds'
Declaration of Trust, a Fund's shareholder approval is required to effectuate
the liquidation of the Fund's assets. Approval of the proposed liquidation with
respect to a Fund 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.
After liquidating all of the assets of the Fund, the Trustees intend to
distribute to shareholders of the Fund their pro rata share of the Fund's
assets, after paying all outstanding obligations, taxes, and other liabilities,
accrued or contingent, of the Fund, as required by HighMark Funds' Declaration
of Trust. Thereafter, the Trustees intend to wind up the affairs of the Fund and
take such steps as are necessary to terminate the Fund's state or federal
registration. Liquidation and distribution of the Fund's assets and the winding
up and
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<PAGE> 9
termination of the Fund will take place as soon as reasonably practicable after
the Special Meeting.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS APPROVE THE LIQUIDATION OF
THE FUND.
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 the
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.
In the event that a shareholder signs and returns the proxy card, but
does not indicate a choice on the proxy card, the proxy attorneys will vote
those shares in favor of the liquidation proposal.
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 HighMark Funds or HighMark Funds' service providers or,
if necessary, a commercial firm retained for this purpose. The cost of preparing
and mailing the notice of meeting, the proxy card, this proxy statement and any
additional proxy material will be borne by HighMark Capital Management, Inc.
("HighMark Capital Management") and/or its affiliates. Brokerage firms and
others will be reimbursed for their expenses in forwarding solicitation
materials to the beneficial owners of Shares of the Funds.
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The Funds' Investment Advisor is HighMark Capital Management, Inc., a
subsidiary of Union BanCal Corporation, a publicly traded corporation which is
principally owned by The Bank of Tokyo-Mitsubishi, Ltd.
The Funds' principal distributor and administrator are SEI Investments
Distribution Co. and SEI Investments Mutual Funds Services, respectively, One
Freedom Valley Drive, Oaks, Pennsylvania 19456. SEI Investments Distribution Co.
and SEI Investments Mutual Funds Services are direct and indirect subsidiaries
of SEI Investments, which provides investment solutions to banks, institutional
investors, investment advisers, and insurance companies.
Union Bank of California, N.A. ("Union Bank of California"), an
affiliate of HighMark Capital Management, has a dealer agreement with SEI
Investments Distribution Co. pursuant to which Union Bank of California is
authorized to place orders with the Funds' Transfer Agent for the purchase of
Shares and tender Shares to the Transfer Agent for redemption.
As of September 30, 1998, HighMark Funds believes that Bank of
Tokyo-Mitsubishi Trust Company had voting power with respect to 30.41% of the
Shares of the Fund. As a result, Bank of Tokyo-Mitsubishi Trust Company may be
deemed to be a "controlling person" of the Fund under the 1940 Act.
The following list indicates the beneficial ownership of the
shareholders who, to the best knowledge of HighMark Funds, were the beneficial
owners of 5% or more of the outstanding Shares of the Convertible Securities
Fund as of September 30, 1998.
PERCENTAGE OF
BENEFICIAL
NAME AND ADDRESS OWNERSHIP
- ---------------- ---------
BTM U.S. Agency Retirement Plan 30.41%
1251 Avenue of the Americas
New York, NY 10020
The following list indicates the shareholders who, to the best
knowledge of HighMark Funds, were the shareholders of record of 5% or more of
the outstanding Shares of the Convertible Securities Fund as of September 30,
1998.
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PERCENTAGE OF
OWNERSHIP
NAME AND ADDRESS OF RECORD
- ---------------- ---------
BOTT Pension 75.11%
c/o Bank of Tokyo Trust Company
Attn: Dennis Demetropoulos
1251 Avenue of the Americas
New York, NY 10020-1104
Lane & Company 16.33%
c/o Union Bank of California
Attn: Kathleen Heilman
P.O. Box 120109
San Diego, CA 92112-0109
As of September 30, 1998, the Officers and Trustees of the Fund owned
less than 1% of the Fund's outstanding Shares.
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.
November 12, 1998
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HIGHMARK CONVERTIBLE SECURITIES FUND
PROXY FOR A SPECIAL MEETING OF
SHAREHOLDERS, DECEMBER 18, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE TRUSTEES OF HIGHMARK FUNDS.
The undersigned hereby appoints Leslie Kondziela and Kevin P. Robins, and each
of them with full power of substitution as proxies of the undersigned, and
hereby authorizes them to represent and to vote, as designated below, at the
Special Meeting of Shareholders of the HighMark Convertible Securities Fund on
Friday, December 18, at 3:30 p.m., Eastern time, and at any adjournments
thereof, all of the shares of the Fund which the undersigned would be entitled
to vote if personally present.
1. Approval of the Liquidation of all of the assets of the HighMark Convertible
Securities Fund.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
2. To transact any other business as may properly come before the meeting or any
adjournment thereof.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR PROPOSAL (1) AND TO AUTHORIZE THE PROXIES, IN THEIR DISCRETION, TO VOTE UPON
SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
THE TRUSTEES RECOMMEND A VOTE FOR ITEMS (1) AND (2).
NOTE: Please sign exactly as the name appears on this card. EACH joint owner
should sign. When signing as executor, administrator, attorney, trustee
or guardian, or as custodian for a minor, please give the full title as such. If
a corporation, please sign in full corporate name and indicate the signer's
office. If a partner, please sign in the partnership name.
Please be sure to sign and date this Proxy.
----------------------------------------
Signature of Shareholder(s)
----------------------------------------
Signature of Shareholder(s)
Dated:______________, 1998
PLEASE EXECUTE, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.
