SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e) (2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
PHOENIX MULTI-PORTFOLIO FUND
(Name of Registrant as Specified in its Charter)
Thomas N. Steenburg, Esq.
c/o Phoenix Duff & Phelps Corporation
56 Prospect Street
Hartford, Connecticut 06115-0480
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction
applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid: ___________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration No.:
3) Filing Party:
4) Date Filed:
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PHOENIX MULTI-PORTFOLIO FUND
101 Munson Street
Greenfield, Massachusetts 01301
Notice of Adjourned Special Meeting
of Shareholders to be Held October 30, 1997
To the Shareholders:
An Adjourned Special Meeting of Shareholders of Phoenix Multi-Portfolio
Fund will be held at 827 Williams Street, Longmeadow, Massachusetts 01106, on
Thursday, October 30, 1997 at 12:00 p.m. for the following purposes:
TO BE VOTED UPON ONLY BY SHAREHOLDERS OF DIVERSIFIED INCOME PORTFOLIO
(1) To approve a new Investment Advisory Agreement providing for
changes to the fees paid to the Investment Adviser;
(2) To approve changes in fundamental policies of the Fund as
follows:
(a) to change the investment objective of the Portfolio to
maximizing current income;
(b) to approve revisions in the restrictions on the use of
call and put options, futures contracts and related
options;
(c) to approve the elimination of a restriction on the use of
futures contracts and related options;
(d) to approve the elimination of restrictions on investments
in the securities of issuers with a record of less than
three years of continuous operations;
(e) to approve an increase in the limitation on the use of
illiquid securities and to eliminate the prohibition on
the purchase of restricted securities;
(f) to approve the elimination of the limitation on the use of
repurchase agreements;
(3) To approve the adoption of a Service Fee Plan.
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The Board of Trustees has fixed September 12, 1997 as the record date for
the determination of shareholders entitled to notice of and to vote at the
meeting.
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Whether or not you plan to attend the meeting in person, please vote your
shares by completing, dating and signing the enclosed proxy and returning it
promptly in the postage paid return envelope enclosed for your use. Prompt
return of proxies by shareholders will save the Fund and shareholders the costs
associated with further solicitation. The enclosed proxy is being solicited by
the Board of Trustees of the Fund.
By Order of the Board of Trustees,
G. Jeffrey Bohne, Secretary
Greenfield, Massachusetts
October 20, 1997
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PHOENIX MULTI-PORTFOLIO FUND
101 Munson Street
Greenfield, Massachusetts 01301
--------------------
PROXY STATEMENT
An Adjourned Special Meeting of Shareholders to be
Held on October 30, 1997
INTRODUCTION
The enclosed proxy is solicited by the Board of Trustees of Phoenix
Multi-Portfolio Fund (the "Trust") for use at the Adjourned Special Meeting of
Shareholders to be held on Thursday, October 30, 1997, and at any adjournment(s)
thereof. Shareholders of record at the close of business on September 12, 1997
of Phoenix Diversified Income Portfolio (the "Fund") are entitled to notice of
and to vote at the meeting or any adjourned session. As of September 12, 1997,
there were in the aggregate, 636,490.926 issued and outstanding shares of the
Fund, of par value of one dollar per share. Shareholders of the Fund will be
entitled to one vote for each full share (and fractional vote corresponding to
any fractional share) registered in his/her name on the Fund's books on the
record date and not thereafter repurchased or redeemed by the Fund.
All shares represented by duly executed proxies will be voted in
accordance with the specification thereon. If a duly executed proxy does not
specify a choice between approval or disapproval of, or abstention with respect
to, any proposal, the shares represented by the proxy will be voted in favor of
the proposal. Any shareholder executing a proxy has the power to revoke it at
any time before it is exercised by executing and submitting to the Fund a
later-dated proxy or written notice of revocation or by attending the meeting
and voting in person.
In addition to the solicitation of proxies by mail, officers and regular
employees of Phoenix Investment Counsel, Inc. and Phoenix Realty Securities,
Inc., the Trust's investment advisers (collectively, the "Investment Advisers"),
and persons employed for such purpose may solicit proxies personally or by
telephone or telegram. Banks, brokers, fiduciaries and nominees will, upon
request, be reimbursed by the Fund for their reasonable expenses in sending
proxy material to beneficial owners of Fund shares. The cost of solicitation of
proxies, which is estimated to approximate $2,000, will be borne by the adviser
or an affiliate, but not by the Fund.
In the event that sufficient votes in favor of any of the items set forth
in the attached Notice of the meeting are not received by the time scheduled for
the meeting, the persons named as proxies may propose one or more adjournments
of the meeting for a period or periods of not more than sixty days in the
aggregate to permit further solicitation of proxies with respect to any such
matters. Any such adjournment(s) will require the affirmative vote of a majority
of the shares present in person or by proxy at the session of the meeting to be
adjourned. The persons
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named as proxies will vote in favor of such adjournment those proxies which they
are entitled to vote in favor of such matters. They will vote against such
adjournment those proxies required to be voted against any such matters.
This Proxy Statement and the enclosed form of proxy are first being
mailed to shareholders on or about October 20, 1997. A copy of the Fund's most
recent annual report will be furnished, without charge, to any shareholder upon
request to Phoenix Equity Planning Corporation, 100 Bright Meadow Boulevard,
P.O. Box 2200, Enfield, Connecticut 06083-2200. Shareholders may also call
Phoenix Equity Planning Corporation toll-free at (800) 243-4361.
Votes Required
The presence in person or by proxy of the holders of a majority of the
outstanding shares is required to constitute a quorum at the meeting. The
holders of each class of shares of all series of the Fund will be voted together
with respect to all Proposals, with one vote per share of the Fund. As used in
this Proxy Statement, the term "a majority of the outstanding shares" means the
lesser of (i) 67% of the shares of the Fund present at the meeting at which more
than 50% of the outstanding shares are represented or (ii) more than 50% of the
outstanding shares of the Fund. The terms "assignment" and "interested person"
as used in this Proxy Statement shall have the respective meanings provided
therefor in the Investment Company Act of 1940, as amended ("1940 Act").
If a shareholder abstains from voting as to any matter, then the shares
held by such shareholder shall be deemed present at the meeting for purposes of
determining a quorum and for purposes of calculating the vote with respect to
such matter, but shall not be deemed to have been voted in favor of such matter.
If a broker returns a "non-vote" proxy, indicating a lack of authority to vote
on such matter, then the shares covered by such non-vote shall be deemed present
at the meeting for purposes of determining a quorum but shall not be deemed to
be represented at the meeting for purposes of calculating the vote with respect
to such matter.
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Security Ownership of Certain Beneficial Owners and Management
Phoenix Home Life Mutual Insurance Company owns 100% of the Fund's
outstanding shares.
On September 12, 1997, Trustees, nominees for Trustee and officers of the
Fund as a group owned beneficially less than one percent of the Fund's
outstanding shares.
The Investment Advisers and the Investment Advisory Agreements
The Trust's investment advisers are Phoenix Investment Counsel, Inc.
("PIC"), 56 Prospect Street, Hartford, Connecticut 06115-0480 and Phoenix Realty
Securities, Inc. ("PRS"), 38 Prospect Street, Hartford, Connecticut 06115-0479
(collectively, the "Advisers"). All of the outstanding shares of PIC are owned
by Phoenix Equity Planning Corporation ("Equity Planning"). All of the
outstanding shares of PRS are owned by Phoenix Realty Group, Inc. ("Phoenix
Realty"). All of the outstanding shares of Equity Planning are owned by Phoenix
Duff & Phelps Corporation ("Phoenix Duff & Phelps"). Approximately 60% of the
outstanding common stock of Phoenix Duff & Phelps are owned by PM Holdings, Inc.
("Holdings"), a wholly-owned subsidiary of Phoenix Home Life. All of the shares
of Phoenix Realty are also owned by Holdings. The principal office of Phoenix
Home Life is located at One American Row, Hartford, Connecticut 06102-5056. The
principal office of Phoenix Duff & Phelps is located at 56 Prospect Street,
Hartford, Connecticut 06115-4080. The principal office of Phoenix Realty is
located 38 Prospect Street, Hartford, Connecticut 06115-0479. The principal
office of Equity Planning is located at 100 Bright Meadow Boulevard, P.O. Box
2200, Enfield, Connecticut 06083-2200.
In addition to the Fund, PIC also serves as investment adviser to all
other Portfolios of Phoenix Multi-Portfolio Fund (except the Real Estate
Securities Portfolio), Phoenix Strategic Allocation Fund, Inc., The Phoenix Edge
Series Fund (all Series other Aberdeen New Asia Series and Phoenix Real Estate
Securities Series), Phoenix Strategic Equity Series Fund (all Series other than
Phoenix Equity Opportunities Fund), Phoenix Series Fund, Phoenix Duff & Phelps
Institutional Mutual Funds (except Enhanced Reserves Portfolio and Real Estate
Equity Securities Portfolio), and as subadviser to SunAmerica Series Trust. PIC
will also be the investment adviser to the Growth and Income Fund of the Phoenix
Equity Series Fund and to the Value Equity Fund and Small Cap Value Fund of the
Phoenix Investment Trust 97 which currently are in registration but are not
effective. PIC has ceased as sub-adviser to American Skandia Trust Phoenix
Balanced Asset Portfolio effective October 14, 1996, Chubb America Fund, Inc.
effective August 28, 1997, and to JNL Series Trust effective May 1, 1997.
As compensation for its services to Phoenix Strategic Allocation Fund,
Inc., PIC is entitled to a fee, payable monthly, at the annual rate of 0.65% of
the average of the aggregate daily net asset values up to $1 billion; 0.60% of
such values between $1 billion and $2 billion; and 0.55% of such values in
excess of $2 billion.
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As compensation for its services to each Series (other than Research
Enhanced Index Series, Aberdeen New Asia Series and the Phoenix Real Estate
Securities Series) of The Phoenix Edge Series Fund, PIC is entitled to a fee,
payable monthly, based on an annual percentage rate of the average of the
aggregate daily net asset values of each Series as follows: for the first
$250,000,000 in assets, 0.40%, 0.70%, 0.50%, 0.60%, 0.75%, 0.55% and 0.75%, for
the Money Market, Growth, Multi-Sector Fixed Income, Strategic Allocation,
International, Balanced Series and Strategic Theme respectively; for the next
$250,000,000 in assets, 0.35%, 0.65%, 0.45%, 0.55%, 0.70%, 0.50% and 0.70%, for
those Series respectively, and for assets over $500,000,000, 0.30%, 0.60%,
0.40%, 0.50%, 0.65%, 0.45% and 0.65%, for those Series respectively. As
compensation for its services to the Research Enhanced Index Series of The
Phoenix Edge Series Fund, PIC is entitled to a fee, payable monthly, at the
annual rate of 0.45% of the average of the aggregate daily net asset values of
such Series. As compensation for its services to the Real Estate Securities
Series of The Phoenix Edge Series Fund, PRS is entitled to a fee, payable
monthly, based on an annual percentage rate of the average of the aggregate
daily net asset values as follows: 0.75% of the first $1 billion; 0.70% of the
next $1 billion; and 0.65% of all sums in excess of $2 billion. The amounts
payable to PIC and PRS are based upon the average of the values of the net
assets of the Series at the close of business each day, computed in accordance
with the method set forth in the Fund's Declaration of Trust. Such amounts are
prorated among the appropriate Series in proportion to their respective averages
of the aggregate daily net asset values for the period for which the fee had
been paid.
As compensation for its services to each Series of Phoenix Strategic
Equity Series Fund, (other than Phoenix Equity Opportunities Fund), PIC is
entitled to a fee, payable monthly, based on an annual percentage rate of the
average of the aggregate daily net asset values of each Series as follows: for
the first $1 billion in assets, 0.75% for the Strategic Theme and Small Cap
Series; for the next $1 billion in assets, 0.70% for those Series, and for
assets over $2 billion, 0.65% for those Series. The amounts payable to PIC are
based upon the average of the values of the net assets of all of the Series at
the close of business each day, computed in accordance with the Fund's
Declaration of Trust. Such amounts are prorated among the Series in proportion
to their respective averages of the aggregate daily net asset value for the
period for which the fee had been paid.
As compensation for its services to each Series of Phoenix Series Fund,
PIC is entitled to a fee, payable monthly, based on an annual percentage rate of
the average of the aggregate daily net asset values of each Series as follows:
for the first $1 billion in assets, 0.70%, 0.70%, 0.65%, 0.65%, 0.55%, 0.45% and
0.40% for the Growth, Aggressive Growth, Convertible, High Yield, Balanced, U.S.
Government and Money Market Series respectively; for the next $1 billion in
assets, 0.65%, 0.65%, 0.60%, 0.60%, 0.50%, 0.40% and 0.35% for those Series
respectively, and for assets over $2 billion, 0.60%, 0.60% 0.55%, 0.55%, 0.45%,
0.35% and 0.30% for those Series respectively. The amounts payable to PIC are
based upon the average of the values of the net assets of all of the Series at
the close of business each day computed in accordance with the Fund's
Declaration of Trust. Such
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amounts are prorated among the Series in proportion to their respective averages
of the aggregate daily net asset value for the period for which the fee had been
paid.
As compensation for its services to Phoenix Duff & Phelps Institutional
Mutual Funds (except Enhanced Reserves Portfolio and Real Estate Equity
Securities Portfolio), PIC is entitled to a fee, payable monthly, based on an
annual percentage rate of the average of the aggregate daily net asset values of
each Portfolio as follows: for the first $1 billion in assets, 0.55%, 0.45%,
0.60%, 0.25% and 0.30% for the Balanced, Managed Bond, Growth, Money Market and
U.S. Government Securities, respectively and for assets over $1 billion, 0.50%,
0.40%, 0.55%, 0.20% and 0.25% for those funds respectively.
As compensation for its services to SunAmerica Series Trust, PIC is
entitled to a monthly fee at the annual rate of 0.35% per annum of the first $50
million of the average daily net asset values of the Growth Portfolio; 0.30% per
annum of the next $100 million; 0.25% per annum of the next $150 million; 0.20%
per annum of the next $200 million; and 0.15% per annum thereafter.
As of November 30, 1996, Phoenix Strategic Allocation Fund, Inc., The
Phoenix Edge Series Fund (all Series other than Aberdeen New Asia Series and
Phoenix Real Estate Securities Series), Phoenix Strategic Equity Series Fund
(all Series other than Phoenix Equity Opportunities Fund), Phoenix Series Fund,
Phoenix Duff & Phelps Institutional Mutual Funds (except Enhanced Reserves
Portfolio and Real Estate Equity Securities Portfolio), Chubb America Fund, Inc.
(Balanced Portfolio), and SunAmerica Series Trust (Balanced/Phoenix Investment
Counsel Portfolio and Growth/Phoenix Investment Counsel Portfolio) had assets
under management of approximately $336,837,000, $2,322,204,000, $386,561,000,
$5,871,815,000, $306,006,000, $20,055,000, $69,912,000 and $183,351,000,
respectively.
PRS serves as investment adviser to Phoenix Real Estate Equity Securities
Portfolio, a Portfolio of Phoenix Duff & Phelps Institutional Mutual Funds,
Phoenix Real Estate Securities Series, a series of The Phoenix Edge Series Fund
and to Phoenix Real Estate Securities Portfolio, a portfolio of the Trust. As
compensation for its services to Phoenix Real Equity Securities Portfolio, PRS
is entitled to a fee, payable monthly, a base fee based on the annual rate of
0.50% of the average aggregate daily net asset value of the Portfolio. As
compensation for its services to Phoenix Real Estate Securities Series and
Phoenix Real Estate Securities Portfolio, respectively, PRS is entitled to a
fee, for each Series or Portfolio, payable monthly, at the annual rate of 0.75%
of the average daily net asset values up to $1 billion; 0.70% of such values
between $1 billion and $2 billion; and 0.65% of such values in excess of $2
billion.
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As of November 30, 1996, Phoenix Real Estate Equity Securities Portfolio,
Phoenix Real Estate Securities Series and Phoenix Real Estate Securities
Portfolio had assets under management of approximately $ 0, $16,040,000 and
$31,200,000, respectively.
The directors of PIC are Michael E. Haylon, President, Philip R.
McLoughlin and David R Pepin. The address of these Directors is 56 Prospect
Street, Hartford, CT 06115-0480. The principal occupation of each director is
that of an executive officer of Phoenix Duff & Phelps Corporation or of Phoenix
Home Life. Mr. McLoughlin also serves as a Director of Phoenix Home Life.
Michael E. Haylon, an officer of the Trust, is President and a director
of PIC. Philip R. McLoughlin, Trustee and President of the Trust, is a Director
and Chairman of PIC. David L. Albrycht, Matthew Considine, Jeanne H. Dorey,
Timothy M. Heaney, William E. Keen, III, Peter S. Lannigan, David Lui, Thomas S.
Melvin, Jr. and Leonard J. Saltiel, Vice Presidents of the Trust, are also
officers of PIC. James D. Wehr, Senior Vice President of the Trust, is also
Managing Director, Fixed Income of PIC; William R. Moyer, Vice President of the
Trust, is Senior Vice President, Chief Financial Officer and Treasurer of PIC
and William J. Newman, Senior Vice President of the Trust is Executive Vice
President and Chief Investment Strategist of PIC.
Michael E. Haylon, Philip R. McLoughlin and David R. Pepin are Directors
of Equity Planning, PIC's parent company, which serves as national distributor
of the Trust's shares. For the fiscal years ended November 30, 1994, 1995 and
1996, Equity Planning's gross commissions on sales of Trust shares totaled
$3,280,959, $1,655,136, and $1,599,637, respectively. Of these gross selling
commissions, $2,912,614, $1,454,880 and $1,340,722, respectively, were paid to
dealers. Equity Planning also acts as financial agent of the Trust. For services
in this capacity during the fiscal years ended November 30, 1994, 1995 and 1996,
Equity Planning received fees of $233,476, $229,771 and $245,491, respectively.
The directors of PRS are Robert W. Fiondella, Philip R. McLoughlin, Scott
C. Noble, Charles J. Paydos, David W. Searfoss and Dona D. Young. The address of
Messrs. Fiondella, Searfoss and Ms. Young is One American Row, Hartford,
Connecticut 06102-5056. The address of Mr. McLoughlin is 56 Prospect Street,
Hartford, Connecticut 06115-0480. The address of Mr. Noble is 38 Prospect
Street, Hartford, Connecticut 06115-0479. The address of Mr. Paydos is 100
Bright Meadow Blvd., Enfield, Connecticut 06083-2200. The principal occupation
of each director is that of an executive officer of Phoenix Home Life.
Philip R. McLoughlin, an officer and Trustee of the Trust, is a director
of PRS. Mr. Noble, an officer of the Trust, is an officer and director of PRS.
Barbara Rubin is Vice President of the Trust and an officer of PRS.
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The Advisory Agreements
The Investment Advisory Agreements between the Trust and PIC and between
the Trust and PRS (collectively, the "Advisory Agreements") provide that PIC and
PRS will serve as investment advisers to the Trust and to each portfolio of the
Trust ("Portfolios") established and designated by the Trustees which, at
November 30, 1996, were the Mid Cap Portfolio previously known as Capital
Appreciation Portfolio, the International Portfolio, the Tax-Exempt Bond
Portfolio, the Endowment Equity Portfolio, the Diversified Income Portfolio
previously known as Endowment Fixed-Income Portfolio, the Emerging Markets Bond
Portfolio, and the Real Estate Securities Portfolio.
With respect to the assets of the Mid Cap, International, Tax-Exempt
Bond, Endowment Equity, Diversified Income and Emerging Markets Bond Portfolios,
PIC acts under an Advisory Agreement dated January 1, 1994. The shareholders of
the Trust last approved the Advisory Agreement on January 31, 1994 because the
Advisory Agreement provided for a revised fee structure. With respect to the
assets of the Real Estate Securities Portfolio, PRS acts under an Advisory
Agreement dated February 28, 1995. The shareholders of the Trust last approved
the Advisory Agreement March 1, 1995 to add the Real Estate Securities Portfolio
to the Advisory Agreement. The Advisory Agreements have been approved by the
Trustees, including a majority of the Trustees who are not interested persons,
as that term is defined in the 1940 Act, of the Advisers or of the Trust on
August 25, 1993 and November 16, 1994.
The Advisory Agreements provide that the Adviser shall furnish
continuously an investment program for the specified Portfolio(s) and any
additional Portfolio which becomes subject to the terms and conditions of the
particular Advisory Agreement, and shall manage the investment and reinvestment
of the assets of each such Portfolio subject at all times to the supervision of
the Trustees. The Adviser, at its expense, also furnishes to the Trust adequate
office space and facilities and certain administrative services, including the
services of any member of its staff who serves as an officer of the Trust. All
costs and expenses (other than those specifically referred to as being borne by
the Adviser) incurred in the operation of the Trust are borne by the Trust. Such
expenses include, but are not limited to, all expenses incurred in the operation
of the Trust and any public offering of its shares, including, among others,
interest, taxes, brokerage fees and commissions, fees of Trustees who are not
full-time employees of PIC or PRS or any of their affiliates, expenses of
Trustees' and shareholders' meetings, including the cost of printing and mailing
proxies, expenses of insurance premiums for fidelity and other coverage,
expenses of repurchase and redemption of shares, expenses of issue and sale of
shares (to the extent not borne by the national distributor under its agreement
with the Trust), expenses of printing and mailing stock certificates
representing shares of the Trust, association membership dues, charges of
custodians, transfer agents, dividend disbursing agents and financial agents,
bookkeeping, auditing and legal expenses. The
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Trust will also pay the fees and bear the expense of registering and maintaining
the registration of the Trust and its shares with the Securities and Exchange
Commission and registering or qualifying its shares under state or other
securities laws and the expense of preparing and mailing prospectuses and
reports to existing shareholders. Additionally, if authorized by the Trustees,
the Trust will pay for extraordinary expenses and expenses of a non-recurring
nature which may include, but not be limited to, the reasonable and
proportionate cost of any reorganization or acquisition of assets and the cost
of legal proceedings to which the Trust is a party.
Each Portfolio will pay expenses incurred in its own operation and will
also pay a portion of the Trust's general administration expenses allocated on
the basis of the asset values of the respective Portfolios.
Under the Advisory Agreements, the Advisers have agreed to reimburse the
Trust monthly for the amount, if any, by which the total operating and
management expenses of any Portfolio (including the Adviser's compensation, but
excluding interest, taxes, brokerage fees and commissions, and extraordinary
expenses) for any fiscal year exceed the level of expenses which such Portfolio
is permitted to bear under the most restrictive expense limitation imposed (and
not waived) on open-end investment companies by any state in which shares of
such Portfolio are then qualified for sale. Present expense limitations, to the
best of the Trust's knowledge, require that each Adviser reimburse the Trust, to
the extent of the compensation received by it from the Trust, for the amount, if
any, by which total operating and management expenses (excluding interest,
taxes, brokerage fees and commissions, and extraordinary expenses) of any
Portfolio in any fiscal year exceed 2-1/2% of the first $30,000,000, 2% of the
next $70,000,000, and 1-1/2 % of any excess over $100,000,000 of such
Portfolio's average net assets for such fiscal year.
For the period from April 1, 1993 to November 30, 1997, PIC has agreed to
reimburse the Trust for the amount by which the total operating expenses of the
Endowment Equity Portfolio and the Diversified Income Portfolio exceed 0.85% and
0.65% of the Portfolio's average net assets, respectively. PIC has agreed to
reimburse the Emerging Markets Bond Portfolio's operating expenses related to
Class A Shares and Class B Shares for the amount, if any, by which such
operating expenses exceed 1.50% and 2.25%, respectively, of the average net
assets for the fiscal years ended November 30, 1995, 1996 and 1997. PRS has
agreed to reimburse the Real Estate Securities Portfolio's operating expenses
related to Class A Shares and Class B Shares for the amount, if any, by which
such operating expenses exceed 1.30% and 2.05%, respectively, of the average net
assets for the fiscal years ended November 30, 1995, 1996 and 1997. For the
fiscal years ended November 30, 1994, 1995 and 1996, PIC reimbursed the Trust
$150,321, $175,341, and $189,883 respectively, for the benefit of the Endowment
Equity Portfolio and the Diversified Income Portfolio. In addition, for the
fiscal year ended November 30, 1996, PIC reimbursed the Trust $123,979 for the
benefit of the Emerging Markets Bond Portfolio. PRS reimbursed the Trust
$130,944 for the benefit of the Real Estate Securities Portfolio for the fiscal
year ended November 30, 1996.
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As compensation for its services to Portfolios of the Phoenix
Multi-Portfolio Fund, PIC is entitled to a fee based on an annual percentage
rate of the average of the aggregate daily net asset values of each Portfolio as
follows: for the first $1 billion in assets, 0.45%, 0.75%, 0.75%, 0.75%, 0.50%,
and 0.75% for the Tax-Exempt Bond, Mid Cap, International, Endowment Equity,
Diversified Income and Emerging Markets Bond Portfolios respectively; for the
next $1 billion in assets, 0.40%, 0.70%, 0.70%, 0.70%, 0.45% and 0.70% for those
Portfolios respectively; and for assets over $2 billion, 0.35%, 0.65%, 0.65%,
0.65%, 0.40% and 0.65% for those Portfolios respectively. As compensation for
its services to the Real Estate Securities Portfolio of the Trust, PRS is
entitled to a fee, payable monthly, based on an annual percentage rate of the
average of the aggregate daily net asset values as follows: 0.75% of the first
$1 billion; 0.70% of the next $1 billion; and 0.65% of all sums in excess of $2
billion. The amounts payable to PIC and PRS shall be based upon the average of
the values of the net assets of the Portfolio at the close of business each day,
computed in accordance with the method set forth in the Declaration of Trust.
Such amounts shall be prorated among the appropriate Portfolio's in proportion
to their respective averages of the aggregate daily net asset values for the
period for which the fee had been paid. For services to the Trust during the
fiscal year ended November 30, 1996, PIC received fees of $5,524,141. For
services to Mid Cap, International, Tax-Exempt Bond, Endowment Equity,
Diversified Income and Emerging Markets Bond Portfolios during the fiscal year
ended November 30, 1996, PIC received gross advisory fees of $3,579,657,
$1,071,572, $646,989, $20,860, $27,273 and $177,790. For services to the Real
Estate Securities Portfolio during the fiscal year ended November 30, 1996, PRS
received a fee of $168,177.
The Advisory Agreements provide that the Investment Advisers shall not be
liable to the Trust or to any shareholder of the Trust for any error of judgment
or mistake of law or for any loss suffered by the Trust or by any shareholder of
the Trust in connection with the matters to which the Advisory Agreements
relate, except a loss resulting from willful misfeasance, bad faith, gross
negligence or reckless disregard on the part of the Investment Advisers in the
performance of their duties thereunder.
Each Advisory Agreement continues in force from year to year for the
specified Portfolio(s) and any additional Portfolio that may become subject to
its terms and conditions provided that, with respect to each such Portfolio, the
Advisory Agreement is approved initially by vote of a majority of the
outstanding voting securities of such Portfolio and thereafter at least annually
either by the Trustees or by vote of a majority of the outstanding voting
securities of such Portfolio. In addition, and in either event, the terms of the
Advisory Agreements and any renewal thereof must be approved by the vote of a
majority of Trustees who are not parties to the Advisory Agreements or
"interested persons" (as that term is defined in the 1940 Act) of any such party
cast in person at a meeting called for the purpose of voting on such approval.
The Advisory Agreements will terminate automatically upon their assignment
(within the meaning of said 1940 Act) and may be terminated at any time, without
payment of any penalty, either by the
9
<PAGE>
Trustees, or, as to each Portfolio, by a vote of a majority of the outstanding
voting securities of such Portfolio or by the Adviser upon sixty (60) days'
written notice to the Trust.
Portfolio Transactions and Brokerage
In effecting portfolio transactions for all Portfolios of the Trust, each
Investment Adviser adheres to the Trust's policy of seeking best execution and
price, determined as described below, except to the extent it is permitted to
pay higher brokerage commissions for "brokerage and research services" as
defined herein. Each Investment Adviser may cause any Portfolio of the Trust to
pay a broker or dealer an amount of commission for effecting a securities
transaction in excess of the amount of commission which another broker or dealer
would have charged for effecting that transaction if the Investment Adviser
determines in good faith that such amount of commission is reasonable in
relation to the value of the brokerage and research services provided by such
broker or dealer or that any offset of direct expenses of a Portfolio yields the
best net price. As provided in Section 28(e) of the Securities Exchange Act of
1934, "brokerage and research services" include advice as to the value of
securities, the advisability of investing in, purchasing or selling securities,
the availability of securities or purchasers or sellers of securities,
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and the performance of accounts;
and effecting securities transactions and performing functions incidental
thereto (such as clearance and settlement). Brokerage and research services
provided by brokers to any Portfolio of the Trust or the Investment Advisers are
considered to be in addition to and not in lieu of services required to be
performed by the Investment Adviser under its contract with the Trust and may
benefit both other Portfolios of the Trust and other clients of the Investment
Adviser. Conversely, brokerage and research services provided by brokers to
other clients of the Investment Adviser may benefit one or more Portfolios of
the Trust. Where transactions are made in the over-the-counter market, the
Investment Adviser will cause all Portfolios of the Trust to deal with the
primary market makers, unless more favorable prices are otherwise obtainable.
The Trust has adopted a policy and procedures governing the execution of
aggregated advisory client orders ("bunching procedures") in an attempt to lower
commission costs on a per-share and per-dollar basis. According to the bunching
procedures, the Advisor shall aggregate transactions unless it believes in its
sole discretion that such aggregation is inconsistent with its duty to seek best
execution (which shall include the duty to seek best price) for the Trust. No
advisory account of the Adviser is to be favored over any other account and each
account that participates in an aggregated order is expected to participate at
the average share price for all transactions of the Adviser in that security on
a given business day, with all transaction costs shared pro rata based on the
Trust's participation in the transaction. If the aggregated order is filled in
its entirety, it shall be allocated among the Adviser's accounts in accordance
with the allocation order, and if the order is partially filled, it shall be
allocated pro rata based on the allocation order. Notwithstanding the foregoing,
the order may be allocated on a basis
10
<PAGE>
different from that specified in the allocation order if all accounts of the
Adviser whose orders are allocated receive fair and equitable treatment and the
reason for such different allocation is explained in writing and is approved in
writing by the Adviser's compliance officer as soon as practicable after the
opening of the markets on the trading day following the day on which the order
is executed. If an aggregated order is partially filled and allocated on a basis
different from that specified in the allocation order, no account that is
benefited by such different allocation may intentionally and knowingly effect
any purchase or sale for a reasonable period following the execution of the
aggregated order that would result in it receiving or selling more shares than
the amount of shares it would have received or sold had the aggregated order
been completely filled.
The policy of the Trust with respect to brokerage is reviewed by the
Trustees annually. Because of the possibility of further regulatory developments
affecting the securities exchanges and brokerage practices generally, the
foregoing practices may be changed, modified or eliminated.
For the fiscal years ended November 30, 1994, 1995 and 1996, brokerage
commissions paid by the Trust on portfolio transactions totaled $3,707,102,
$3,554,069 and $3,113,638 respectively. Brokerage commissions of $2,705,782 were
paid during the fiscal year ended November 30, 1996 on transactions aggregating
$1,346,058,813 executed by brokers who provided research and other statistical
and factual information. None of such commissions was paid to a broker who was
an affiliated person of the Trust or an affiliated person of such a person or,
to the knowledge of the Trust, to a broker an affiliated person of which was an
affiliated person of the Trust, its advisers or its national distributor.
For the fiscal year ended November 30, 1996, the portfolio turnover rates for
the Tax-Exempt Bond, Mid Cap, International, Real Estate Securities, Emerging
Markets Bond, Endowment Equity and Diversified Income Portfolios were 27%, 242%,
151%, 24%, 378%, 142%, and 231% respectively. For the fiscal year ended November
30, 1995, the portfolio turnover rates for the Tax-Exempt Bond, Mid Cap,
International, Endowment Equity and Diversified Income Portfolios were 25%,
218%, 236%, 248% and 618% respectively. For the fiscal year ended November 30,
1994, the portfolio turnover rates for the Tax-Exempt Bond, Mid Cap,
International, Endowment Equity and Diversified Income Portfolios were 54%,
227%, 186%, 250% and 124% respectively. The Endowment Equity and Diversified
Income, previously known as Endowment Fixed-Income, Portfolios commenced
operations on April 1, 1993. The Real Estate Securities Portfolio commenced
operations on March 1, 1995. The Emerging Markets Bond Portfolio commenced
operations on September 5, 1995.
11
<PAGE>
PROPOSAL NO. 1
TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT PROVIDING FOR CHANGES TO THE FEES
TO THE INVESTMENT ADVISER
At a meeting of the Executive Committee ("Committee") on May 27, 1997,
the Committee approved and recommended to the Board of Trustees that it approve
an amendment to the Investment Advisory Agreement currently in effect to change
the advisory fees payable as follows: 0.55% of the first $1 billion of assets;
0.50% of the next $1 billion, and 0.45% of all assets in excess of $2 billion.
At a meeting of the Board of Trustees on May 28, 1997, at which there was
present and voting in person a majority of the Trustees who are not parties to
the Investment Advisory Agreement or interested persons of any such party, the
Trustees unanimously approved an amendment to the Investment Advisory Agreement
that provides for changes to the fees paid to the Investment Advisor ("Proposed
Agreement"). (See Exhibit A). Under the Proposed Agreement, the proposed fees
are designed to conform to the fees charged to similar funds by the Investment
Advisor or its affiliates and to be consistent with prevailing advisory fees for
similar funds in the mutual fund industry. The proposed fees are intended to
recognize the higher level and cost of the management effort required by the
change of investment objectives, as well as the services performed, the
performance results achieved, and the Investment Adviser's net earnings.
The fee actually paid by the Fund under the current fee structure for
the month ending November 30, 1996 was $27,273. Had the new fee structure been
in effect the fee would have been $30,000 for the same time period. The
percentage difference between the aggregate amount of the investment adviser's
fee during the year ended November 30, 1996 had the new fee structure been in
effect is 0.05%. The Fund's total operating expense ratios for the fiscal years
ended November 30, 1994, 1995 and 1996 were 0.65%, 0.65%, and 0.65%,
respectively. If the proposed fees had been in place for the fiscal years ended
November 30, 1994, 1995 and 1996, the Fund's total operating expense ratios
would have been 0.65%, 0.65%, and 0.65%, respectively. Total Operating Expenses
would have been 4.24%, 3.57%, and 2.30% for the fiscal years ended November 30,
1994, 1995 and 1996, respectively, absent any reimbursement.
The current management fee for the Diversified Income Portfolio is
equal to an annual rate of 0.50% of the average of the aggregate daily net asset
values of the Fund up to the first $1 billion, 0.45% of such value between $1
billion and $2 billion, and 0.40% of such value in excess of $2 billion.
Under the proposed Investment Advisory Agreement, the following fees,
based on the following annual rates as a percentage of the average aggregate
daily net asset values the Fund, would be paid to the Investment Adviser:
12
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------- ---------------------------------- -------------------------------------------------
PROPOSED RATES
- -------------------------------- ---------------------------------- ---------------- --------------- ----------------
ACTUAL RATE BASED 1ST
FUND ON 11/96 AVERAGE ASSET SIZE $1 BILLION $1-2 $2+
BILLION BILLION
- -------------------------------- ---------------------------------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C>
Diversified 0.50% 0.55% 0.50% 0.45%
Income Portfolio
f/k/a Endowment Fixed-Income
- -------------------------------- ---------------------------------- ---------------- --------------- ----------------
</TABLE>
The following chart contains actual and pro forma expense information
and ratios for the last fiscal year. Pro forma expense ratios indicate what the
expense ratios would have been had the proposed fee structure and actual asset
sizes applied during the fiscal year.
13
<PAGE>
<TABLE>
<CAPTION>
ACTUAL TOTAL OPERATING EXPENSE PRO FORMA TOTAL OPERATING
EXPENSES
<S> <C> <C>
Shareholder Transaction Expenses
Maximum Sales Load Imposed on
Purchases (as a percentage of offering None 4.75%
price)
Maximum Sales Load: Dividends None None
Deferred Sales Load
Redemption Fees (a) None None
Exchange Fee None None
Annual Fund Operating Exp.
(as a %)
Management Fees 0.50% 0.55%
Service Fees None 0.25%
Other Operating Expenses
(after reimbursement) (b) 0.15% (0.15)%
----- ------
Total Operating Expenses 0.65% 0.65%
</TABLE>
(a) The Trustees may, at their option, impose a redemption fee not in
excess of 1% of net asset value. They do not presently intend to impose such a
redemption charge and shareholders will be given reasonable notice to any change
in this intention.
(b) The Adviser has agreed to reimburse the Trust for the amount by
which operating expenses for any fiscal year through November 30, 1997 exceed
0.65% of the Portfolio's average net assets. On a pro forma basis the Adviser
would have to relinquish a portion of its management fee to fulfill that
commitment. For the fiscal year ending November 30, 1998 the Adviser has agreed
to reimburse the Trust for the amount by which operating expenses exceed 1.00%
of the Portfolio's average net assets. The actual total operating expense ratio
for the fiscal year would have been 2.30% absent reimbursement. The pro forma
total operating expense ratio for the fiscal year would have been 2.60% absent
reimbursement.
The Board considered the current fee and expense structure, historical
expense ratios, expense limitations and voluntary reimbursements as compared to
the fee and expense structure proposed. The Board took note of the fact that the
orientation of the fund is sought to be changed, and that changes in fees and
expenses were consistent with those changes and comparable to fees charged to
similar funds. The Board also reviewed current financial and profitability
information of the Adviser and concluded that the proposed fee and expense
structure was justified by the costs of operating the fund and the Adviser's
entitlement to a fair profit. Finally the Board reviewed and noted the superior
performance of the Fund and found that the specific increase in the management
fee was fair and appropriate.
Voting Requirements
14
<PAGE>
The Trustees recommend that the shareholders approve the Proposed
Agreement. Approval of the Agreement is to be determined by the vote of a
majority of the outstanding shares of the Fund, voting as a separate class. A
majority is constituted by the lessor of: (a) 67% or more of the voting
securities present at such meeting, if the holders of more than 50% of the
outstanding voting securities of such Fund are present or represented by proxy;
or (b) more than 50% of the outstanding voting securities of such Fund. The
Investment Advisory Agreement shall become effective upon the effectiveness of a
post-effective amendment to the Trust's registration statement describing such
Investment Advisory Agreement. If the Agreement is not approved by the
shareholders of the Fund, the Investment Adviser will continue to serve as
investment adviser to such Fund under the terms of the current Advisory
Agreement for the period of time pending approval of the Proposed Agreement (not
to exceed one hundred and twenty days) or a different investment advisory
agreement with the Investment Advisor.
THE TRUSTEES RECOMMEND A VOTE "FOR" THE APPROVAL OF THE PROPOSED INVESTMENT
ADVISORY AGREEMENT
PROPOSAL NO. 2
TO APPROVE A CHANGE IN FUNDAMENTAL POLICIES
Voting Requirements
Shareholder approval of each of the proposed fundamental investment
policies revisions will require the affirmative vote of the holders of a
majority of the outstanding shares of the Portfolio voting as a class. A
majority is constituted by the lessor of: (a) 67% or more of the voting
securities present at such meeting, if the holders of more than 50% of the
outstanding voting securities of such Portfolio are present or represented by
proxy: or (b) more than 50% of the outstanding voting securities of such
Portfolio. Upon shareholder approval the investment restrictions will become
effective upon the effectiveness of a post-effective amendment to the Trust's
registration statement describing such investment restrictions.
The following will each be voted separately.
PROPOSAL NO. 2A
15
<PAGE>
TO APPROVE A CHANGE IN INVESTMENT OBJECTIVE
Management recommended and the Board of Trustees approved changes in
the Diversified Income Portfolio of Phoenix Multi-Portfolio Fund including a
change in its investment objective from seeking current income through
investment primarily in publicly traded, investment quality debt securities to
one that maximizes current income by investing in debt securities. Capital
appreciation will remain as a secondary objective. The Fund seeks to achieve its
objective by investing principally in four market sectors: (1) debt securities
of U.S. companies including lower-rated, high yield securities; (2)
mortgage-related securities; (3) debt securities of foreign governments and
companies including non-dollar denominated instruments; and (4) U.S. Government
securities. To help to achieve the revised objective several other fundamental
policies are proposed to be changed, as explained below.
THE TRUSTEES RECOMMEND A VOTE "FOR" A CHANGE
IN INVESTMENT OBJECTIVE
PROPOSAL 2B
TO APPROVE REVISIONS IN THE RESTRICTIONS ON THE USE OF CALL AND PUT OPTIONS,
FUTURES CONTRACTS AND RELATED OPTIONS
The Trust's fundamental investment policies, set forth as investment
restrictions in the Statement of Additional Information, currently contain
restrictions on the use of call and put options and futures contracts and
related options. Restriction (3) on page 7 of the Trust's Statement of
Additional Information currently reads as follows:
"No Portfolio of the Trust may:
16
<PAGE>
(3) Write, purchase or sell puts, calls or combinations thereof, except
that the Portfolio may (a) write exchange-traded covered call options on
portfolio securities and enter into closing purchase transactions with respect
to such options, and a Portfolio may write exchange-traded covered call options
on foreign currencies and secured put options on securities and foreign
currencies and write covered call and secured put options on securities and
foreign currencies traded over the counter, and enter into closing purchase
transactions with respect to such options, (b) purchase exchange-traded call
options and put options, provided that the premiums on all outstanding call and
put options do not exceed 2% of its total assets, and enter into closing sale
transactions with respect to such options, and (c) engage in financial futures
contracts and related options transactions, provided that the sum of the initial
margin deposits on the Portfolio's existing futures and related options
positions and the premiums paid for related options would not exceed 2% of its
total assets."
The proposed revision would continue to prohibit the Fund from writing
uncovered options and raise the percentage of its assets which may be used for
premiums and initial margin for options and futures to 5% of net assets. The
Adviser believes that these changes will afford the Fund an opportunity to
generate additional income and the ability to hedge against potential declines
in the value of portfolio securities or foreign currencies which might otherwise
adversely affect the Fund. Investment restriction (3) would be restated as
follows:
"The Fund may not...
(3) Write uncovered call or unsecured put options on securities.
Premiums paid on all call and put options held by the Fund may not exceed 5% of
its net assets. Initial margin deposits for financial futures contracts and
related options and premiums paid for related options may not exceed 5% of the
Fund's net assets."
THE TRUSTEES RECOMMEND A VOTE "FOR" THE REVISION OF RESTRICTIONS ON THE USE OF
CALL AND PUT OPTIONS, FUTURES CONTRACTS AND RELATED OPTIONS TO INCREASE THE
APPLICABLE LIMIT TO 5% NET ASSETS
PROPOSAL 2C
TO APPROVE THE ELIMINATION OF RESTRICTION (7)(b) ON THE USE OF FUTURES
AND RELATED OPTIONS
17
<PAGE>
Restriction (7)(b) on page 7 of the Trust's Statement of Additional
Information currently limits the sum of initial margin deposits on the
Portfolio's futures and related options positions and the premiums paid for
related options to 5% of the Portfolio's total assets. Consistent with the
Commodity Futures Trading Act ("CFTA") this limitation should be expressed as
5% of the Portfolio's net assets.
Revision of Restriction (3) on page 7 of the Trust's Statement of
Additional Information as proposed in Proposal 2B would correctly state the
limitation, in terms of the CFTA, and make Restriction (7)(b) unnecessary.
THE TRUSTEES RECOMMEND A VOTE "FOR" THE ELIMINATION OF RESTRICTION (7)(b)
ON THE USE OF FUTURES CONTRACTS AND RELATED OPTIONS
PROPOSAL 2D
TO APPROVE THE ELIMINATION OF RESTRICTIONS ON INVESTMENTS IN THE SECURITIES
OF ANY ISSUER WITH A RECORD OF LESS THAN THREE YEARS OF CONTINUOUS
OPERATIONS
The Trust's fundamental investment policies, set forth as investment
restrictions in the Statement of Additional Information, currently contains a
restriction whereby the Fund may not invest in the aggregate more than 5% of its
total assets in the securities of any issuers which have (with predecessors) a
record of less than three years of continuous operations. Specifically, it reads
as follows:
"No Portfolio of the Trust may...
(12) Invest in the aggregate more than 5% of its total assets in the
securities of any issuers which have (with predecessors) a record of less than
three years of continuous operations."
18
<PAGE>
The proposed revision would eliminate this investment restriction. The
proposed change presents a change in portfolio risk. Smaller companies are often
companies with limited operating history as a public company or companies within
industries which have recently emerged due to cultural, economic, regulatory or
technological developments. Given the limited operating history and rapidly
changing fundamental prospects, investment returns from smaller companies are
highly volatile. Smaller companies may at times find their ability to raise
capital impaired by their size or lack of operating history. Product lines are
often less diversified and subject to competitive threats. Smaller company
stocks are subject to varying patterns of trading volume creating points in time
when the securities are illiquid. The Adviser believes that this change in the
fundamental policy will afford the Fund an opportunity to generate additional
income, consistent with the investment objective of the Fund. Specifically,
investment restriction number (12) as set forth on page 8 of the Trust's current
Statement of Additional Information would be eliminated in its entirety.
THE TRUSTEES RECOMMEND A VOTE "FOR" THE ELIMINATION OF RESTRICTIONS ON
INVESTMENTS IN THE SECURITIES OF ANY ISSUER WITH A RECORD OF LESS THAN THREE
YEARS CONTINUOUS OPERATIONS
PROPOSAL 2E
TO APPROVE THE INCREASE IN THE LIMITATION ON THE USE OF ILLIQUID SECURITIES
FROM 10% OF TOTAL ASSETS TO 15% OF NET ASSETS AND TO ELIMINATE THE
RESTRICTION ON THE PURCHASE OF RESTRICTED SECURITIES
The Trust's fundamental investment policies, set forth as investment
restrictions in the Statement of Additional Information, currently prohibit
purchases of restricted securities and restrict purchases of illiquid
securities. The current text of restriction (14) on page 8 of the Trust's
Statement of Additional Information is as follows:
"No Portfolio of the Trust may...
(14) Purchase restricted securities (including repurchase agreements
having maturities of more than seven days) or securities for which market value
quotations are not readily available if as a result of such purchase more than
10% of the Portfolio's total assets would be invested in the aggregate in such
securities."
19
<PAGE>
The revised fundamental investment policy would remove the reference to
restricted securities and increase the limitation on illiquid securities from
10% of total assets to 15% of net assets. Furthermore, the revised policy would
transfer from current Restriction (8) the treatment of repurchase agreements
with maturities greater than seven days. The Adviser believes that the status of
a security as "restricted", i.e. not purchased in a public offering, is relevant
only in the context of the security's liquidity. While restricted securities
generally are illiquid, some, including many of those traded in reliance upon
Rule 144A under the Securities Act of 1933, are liquid. In addition, these
changes will create a greater opportunity for the Fund to generate additional
income. Investment restriction (14) would be revised to read as follows:
"The Fund may not...
(13) Purchase securities for which market quotations are not readily
available, including but not limited to repurchase agreements having maturities
of more than seven days, or which are not deemed liquid pursuant to procedures
adopted by the Trustees if as a result of such purchase more than 15% of the
Fund's net assets would be invested in the aggregate in such securities."
THE TRUSTEES RECOMMEND A VOTE "FOR" THE INCREASE IN THE LIMITATION ON THE USE OF
ILLIQUID SECURITIES FROM 10% OF TOTAL ASSETS TO 15% OF NET ASSETS AND TO
ELIMINATE THE RESTRICTION ON THE PURCHASE OF RESTRICTED SECURITIES
PROPOSAL 2F
TO ELIMINATE THE LIMITATION ON THE USE OF REPURCHASE
AGREEMENTS IN RESTRICTION (8)
The Trust's fundamental investment policies, set forth as investment
restrictions in the Statement of Additional Information, currently contains a
restriction on the use of repurchase
20
<PAGE>
agreements and illiquid securities within a restriction that generally addresses
lending of funds and securities. The current text of restriction (8) on page 7
of the Trust's Statement of Additional Information is as follows:
"No Portfolio of the Trust may...
(8) Make loans, except that the Portfolio may (a) purchase bonds,
notes, debentures or similar obligations which are customarily purchased by
institutional investors, whether publicly distributed or not, (b) invest in
repurchase agreements, provided that an aggregate of no more than 10% of the
Portfolio's net assets (taken at market value) may be invested in repurchase
agreements having maturities of more than seven days and all other illiquid
securities, and (c) loan its portfolio securities in amounts up to one third of
the market or other fair value of its total assets, subject to restrictions
described more fully above.
Revision of Restriction (14), as proposed in Proposal 2E, would make
inclusion of the repurchase agreement limitation unnecessary in Restriction (8).
THE TRUSTEES RECOMMEND A VOTE "FOR" THE
ELIMINATION OF THE INFORMATION ON THE USE OF REPURCHASE
AGREEMENTS IN RESTRICTION (8)
21
<PAGE>
PROPOSAL NO. 3
TO APPROVE THE ADOPTION OF A SERVICE FEE PLAN
Rule 12b-1 under the Investment Company Act of 1940, as amended (the
"1940 Act"), which governs the adoption and continuation of distribution plans,
provides in substance that an open-end investment company, such as the Fund, may
not engage directly or indirectly in financing any activity which is primarily
intended to result in the sale of its shares except pursuant to a written plan
that contains certain provisions and has been approved by the Fund's Board of
Trustees and shareholders. The Trustees of the Fund have approved a Distribution
Plan (the "Plan") under which the Distributor will provide services to
shareholders, including handling inquiries and maintaining accounts, in exchange
for a fee, payable monthly, equal to 0.25% of the average daily value of the net
assets of the Fund's shares (the "Service Fee"). A copy of the Distribution Plan
is attached as Exhibit B to this Proxy Statement.
Voting Requirements
Approval of the Plan requires the affirmative vote of (i) 67% or more
of the Fund's shares present and entitled to vote at the Meeting, provided more
than 50% of the Fund's outstanding shares are present or represented by proxy,
or (ii) more than 50% of the Fund's outstanding shares, whichever is less.
Background
Rule 12b-1 Plans enable the Fund to pay distribution expenses and
thereby promote the growth of the Fund, which benefits all shareholders. While
Diversified Income Portfolio has not previously adopted a
22
<PAGE>
Distribution Plan, Distribution Plans are in force for all classes of all other
shares offered by the Phoenix Multi-Portfolio Fund's other Portfolios.
Diversified Income Portfolio presently has only one class of shares; its
proposed plan is identical to the Distribution Plans for Class A Shares of each
of the other Portfolios.
The Plan shall remain in effect for one year from the date of its
adoption and may be continued if approved at least annually by a vote of at
least a majority of the Trustees of the Fund as well as a majority of the
Disinterested Trustees. This Plan may be amended at any time, provided that (a)
the Plan may not be amended to increase materially the amount of the
distribution expenses (including the Service Fee) without the approval of at
least a majority of the outstanding voting securities (as defined in the Act) of
the Class A shares of the Fund and (b) all material amendments to this Plan must
be approved by a majority vote of the Trustees of the Fund and of the
Disinterested Trustees cast in person at meeting called for the purpose of such
vote. While this Plan is in effect, the selection and nomination of Trustees who
are not interested persons (as defined in the Act) of the Fund shall be
committed to the discretion of the Disinterested Trustees then in office. This
Plan may be terminated at any time by a vote of a majority of the Disinterested
Trustees or by a vote of a majority of the outstanding voting securities of the
shares of the Fund. In the event this Plan is terminated or otherwise
discontinued, no further payments will be made.
Factors Considered by the Board of Trustees and Anticipated Benefits from the
Amended Plan
The Trustees reviewed the terms of the proposed Plan and concluded that
adoption of the Plan was in the best interests of the shareholders because the
fees payable would encourage additional sales of shares, thereby increasing
assets under management and moving the Fund toward various breakpoints in
investment management and other agreements using asset-based fees.
23
<PAGE>
THE TRUSTEES RECOMMEND A VOTE "FOR" THE ADOPTION
OF A SERVICE FEE PLAN
MISCELLANEOUS
As of the date of this Proxy Statement, the Trust's management knows of
no other matters to be brought before this meeting. However, if any other
matters properly come before this meeting, the persons named in the enclosed
proxy will vote in accordance with their judgment on such matters.
PROPOSALS FOR NEXT MEETING OF SHAREHOLDERS
The next meeting of shareholders is scheduled to be held in 1998.
Proposals by any shareholder of the Trust which are intended to be presented at
the meeting must be received by the Trust for inclusion in its proxy statement
and form of proxy relating to such meeting on or before July 3, 1998.
By Order of the Board of Trustees,
G. Jeffrey Bohne, Secretary
Greenfield, Massachusetts
October 20, 1997
24
<PAGE>
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT made effective as of the __ day of _________, 199__ by
and between Phoenix Multi-Portfolio Fund, a Massachusetts business trust having
a place of business located at 101 Munson Street, Greenfield, Massachusetts (the
"Trust") and Phoenix Investment Counsel, Inc., a Massachusetts corporation
having a place of business located at 56 Prospect Street, Hartford, Connecticut
(the "Adviser").
WITNESSETH THAT:
1. The Trust hereby appoints the Adviser to act as investment adviser to
the Trust on behalf of the Phoenix Strategic Income Fund formerly the Phoenix
Diversified Income Portfolio, previously established and designated by the
Trustees, (the "Portfolio"), for the period and on the terms set forth herein.
The Adviser accepts such appointment and agrees to render the services described
in this Agreement for the compensation herein provided.
2. The Adviser shall furnish continuously an investment program for the
Portfolio and shall manage the investment and reinvestment of the assets of each
Portfolio, subject at all times to the supervision of the Trustees.
3. With respect to managing the investment and reinvestment of the
Portfolio's assets, the Adviser shall provide, at its own expense:
(a) Investment research, advice and supervision;
(b) An investment program for each Portfolio consistent with
its investment objectives;
(c) Implementation of the investment program for each
Portfolio including the purchase and sale of securities;
(d) Advice and assistance on the general operations of the
Trust; and
(e) Regular reports to the Trustees on the implementation of
each Portfolio's investment program.
4. The Adviser shall, for all purposes herein, be deemed to be an
independent contractor.
5. The Adviser shall furnish at its own expense, or pay the
expenses of the Trust, for the following:
(a) Office facilities, including office space, furniture and
equipment;
(b) Personnel necessary to perform the functions required to
manage the investment and reinvestment of each
Portfolio's assets (including those required for
research, statistical and investment work);
<PAGE>
(c) Personnel to serve without salaries from the Trust as
officers or agents of the Trust. The Adviser need not
provide personnel to perform, or pay the expenses of the
Trust for, services customarily performed for an
open-end management investment company by its national
distributor, custodian, financial agent, transfer agent,
auditors and legal counsel; and
(d) Compensation and expenses, if any, of the Trustees who
are also full-time employees of the Adviser or any of
its affiliates; and
(e) Any subadviser recommended by the Adviser and appointed
to act on behalf of the Trust.
6. All costs and expenses not specifically enumerated herein as payable
by the Adviser shall be paid by the Trust. Such expenses shall include, but
shall not be limited to, all expenses (other than those specifically referred to
as being borne by the Adviser) incurred in the operation of the Trust and any
public offering of its shares, including, among others, interest, taxes,
brokerage fees and commissions, fees of Trustees who are not full-time employees
of the Adviser or any of its affiliates, expenses of Trustees' and shareholders'
meetings including the cost of printing and mailing proxies, expenses of
insurance premiums for fidelity and other coverage, expenses of repurchase and
redemption of shares, expenses of issue and sale of shares (to the extent not
borne by its national distributor under its agreement with the Trust), expenses
of printing and mailing stock certificates representing shares of the Trust,
association membership dues, charges of custodians, transfer agents, dividend
disbursing agents and financial agents, bookkeeping, auditing and legal
expenses. The Trust will also pay the fees and bear the expense of registering
and maintaining the registration of the Trust and its shares with the Securities
and Exchange Commission and registering or qualifying its shares under state or
other securities laws and the expense of preparing and mailing prospectuses and
reports to shareholders. Additionally, if authorized by the Trustees, the Trust
shall pay for extraordinary expenses and expenses of a non-recurring nature
which may include, but not be limited to the reasonable and proportionate cost
of any reorganization or acquisition of assets and the cost of legal proceedings
to which the Trust is a party.
7. For providing the services and assuming the expenses outlined herein,
the Trust agrees that the Adviser shall be compensated as follows:
(a) Within eight calendar days after the end of each month,
the Trust shall pay the Adviser a monthly fee with
respect to each Portfolio at the annual rate of 0.55% of
the average aggregate daily net asset values of each
Portfolio up to $1 billion, 0.50% of the average
aggregate daily net asset values of each Portfolio up to
$1 billion to 2 billion and 0.45% of the average
aggregate daily net asset values in excess of $2
billion. The amounts payable to the Adviser with respect
to each Portfolio shall be based upon the average of the
values of the net assets of such Portfolio as of the
close of business each day, computed in accordance with
the Trust's Declaration of Trust.
(b) Compensation shall accrue immediately upon the effective
date of this Agreement.
(c) If there is termination of this Agreement during a
month, each Portfolio's fee for that month shall be
proportionately computed upon the average of the daily
net asset values of such Portfolio for such partial
period in such month.
(d) The Adviser agrees to reimburse the Trust for the
amount, if any, by which the total operating and
management expenses for any Portfolio (including the
Adviser's compensation, pursuant to this paragraph, but
excluding taxes, interest, costs of portfolio
acquisitions and dispositions and extraordinary
expenses), for any "fiscal year" exceed the level of
expenses which such Portfolio is permitted to bear under
the most restrictive expense limitation (which is not
waived by the State) imposed on open-end investment
companies by any state
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<PAGE>
in which shares of such Portfolio are then qualified.
Such reimbursement, if any, will be made by the Adviser
to the Trust within fifteen calendar days after the end
of each month. For the purpose of this subparagraph (d),
the term "fiscal year" shall include the portion of the
then current fiscal year which shall have elapsed at the
date of termination of this Agreement.
8. The services of the Adviser to the Trust are not to be deemed
exclusive, the Adviser being free to render services to others and to engage in
other activities. Without relieving the Adviser of its duties hereunder and
subject to the prior approval of the Trustees and subject further to compliance
with applicable provisions of the Investment Company Act of 1940, as amended,
the Adviser may appoint one or more agents to perform any of the functions and
services which are to be provided under the terms of this Agreement upon such
terms and conditions as may be mutually agreed upon among the Trust, the Adviser
and any such agent.
9. The Adviser shall not be liable to the Trust or to any shareholder of
the Trust for any error of judgment or mistake of law or for any loss suffered
by the Trust or by any shareholder of the Trust in connection with the matters
to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith, gross negligence or reckless disregard on the part of
the Adviser in the performance of its duties hereunder.
10. It is understood that:
(a) Trustees, officers, employees, agents and shareholders
of the Trust are or may be "interested persons" of the
Adviser as directors, officers, stockholders or
otherwise;
(b) Directors, officers, employees, agents and stockholders
of the Adviser are or may be "interested persons" of the
Trust as Trustees, officers, shareholders or otherwise;
and
(c) The existence of any such dual interest shall not affect
the validity hereof or of any transactions hereunder.
11. This Agreement shall become effective with respect to the Portfolio
as of the date above (the "Contract Date"). Unless terminated as herein
provided, this Agreement shall remain in full force and effect for a period of
two years following the Contract Date, and shall continue in full force and
effect for periods of one year thereafter with respect to each Portfolio so long
as (a) such continuance with respect to any such Portfolio is approved at least
annually by either the Trustees or by a "vote of the majority of the outstanding
voting securities" of such Portfolio and (b) the terms and any renewal of this
Agreement with respect to any such Portfolio have been approved by a vote of a
majority of the Trustees who are not parties to this Agreement or "interested
persons" of any such party cast in person at a meeting called for the purpose of
voting on such approval.
Any approval of this Agreement by a vote of the holders of a "majority
of the outstanding voting securities" of any Portfolio shall be effective to
continue this Agreement with respect to such Portfolio notwithstanding (a) that
this Agreement has not been approved by a "vote of a majority of the outstanding
voting securities" of any other Portfolio of the Trust affected thereby and (b)
that this Agreement has not been approved by the holders of a "vote of a
majority of the outstanding voting securities" of the Trust, unless either such
additional approval shall be required by any other applicable law or otherwise.
12. The Trust may terminate this Agreement with respect to the Trust or
to any Portfolio upon 60 days' written notice to the Adviser at any time,
without the payment of any penalty, by vote of the Trustees or, as to each
Portfolio, by a "vote of the majority of the outstanding voting securities" of
such Portfolio. The Adviser may terminate this Agreement upon 60 days' written
notice to the Trust, without the payment of any penalty. This Agreement shall
immediately terminate in the event of its "assignment".
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<PAGE>
13. The terms "majority of the outstanding voting securities",
"interested persons" and "assignment", when used herein, shall have the
respective meanings in the Investment Company Act of 1940, as amended.
14. In the event of termination of this Agreement, or at the request of
the Adviser, the Trust will eliminate all reference to "Phoenix" from its name,
and will not thereafter transact business in a name using the word "Phoenix" in
any form or combination whatsoever, or otherwise use the word "Phoenix" as part
of its name. The Trust will thereafter in all prospectuses, advertising
materials, letterheads, and other material designed to be read by investors and
prospective investors delete from its name the word "Phoenix" or any
approximation thereof. If the Adviser chooses to withdraw the Trust's right to
use the word "Phoenix", it agrees to submit the question of continuing this
Agreement to a vote of the Trust's shareholders at the time of such withdrawal.
15. It is expressly agreed that the obligations of the Trust hereunder
shall not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but bind only the trust property of
the Trust, as provided in the Declaration of Trust. The execution and delivery
of this Agreement have been authorized by the Trustees and shareholders of the
Trust and signed by the President of the Trust, acting as such, and neither such
authorization by such Trustees and shareholders nor such execution and delivery
by such officer shall be deemed to have been made by any of them individually or
be binding upon or impose any liability on any of them personally, but shall
bind only the trust property of the Trust as provided in its Declaration of
Trust. The Declaration of Trust, as amended, is or shall be on file with the
Secretary of The Commonwealth of Massachusetts.
16. This Agreement shall be construed and the rights and obligations of
the parties hereunder enforced in accordance with the laws of the State of
Connecticut.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers as of the day and year first written above.
PHOENIX MULTI-PORTFOLIO FUND
By:---------------------------------
Philip R. McLoughlin
President
PHOENIX INVESTMENT COUNSEL, INC.
By:---------------------------------
Michael E. Haylon
President
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<PAGE>
EXHIBIT B
PHOENIX MULTI-PORTFOLIO FUND
(the "Fund")
CLASS A SHARES DISTRIBUTION PLAN
PURSUANT TO RULE 12b-1
under the
INVESTMENT COMPANY ACT OF 1940
1. Introduction
The Fund and Phoenix Equity Planning Corporation (the "Distributor"), a
broker-dealer registered under the Securities Exchange Act of 1934, have entered
into a Distribution Agreement pursuant to which the Distributor will act as
principal underwriter of each class of shares of the Fund for sale to the
permissible purchasers. The Trustees of the Fund have determined to adopt this
Distribution Plan (the "Plan"), in accordance with the requirements of Section
12b-1 of the Investment Company Act of 1940, as amended (the "Act") with respect
to Class A shares of the Fund and have determined that there is a reasonable
likelihood that the Plan will benefit the Fund and its Class A shareholders.
2. Rule 12b-1 Fees
The Fund shall pay the Distributor, at the end of each month, an amount
on an annual basis equal to 0.25% of the average daily value of the net assets
of the Fund's Class A shares, as compensation for providing personal service to
shareholders, including assistance in connection with inquiries relating to
shareholder accounts, and for maintaining shareholder accounts (the "Service
Fee").
Amounts paid or payable by the Fund under this Plan or any agreement
with any person or entity relating to the implementation of this Plan ("related
agreement") shall only be used to pay for, or reimburse payment for, the
distribution expenditures described in the preceding paragraph and shall, given
all surrounding circumstances, represent charges within the range of what would
have been negotiated at arm's length as payment for the specific sales or
promotional services and activities to be financed hereunder and any related
agreement, as determined by the Trustees of the Fund, in the exercise of
reasonable business judgment, in light of fiduciary duties under state law and
Sections 36(a) and (b) of the Act and based upon appropriate business estimates
and projections.
3. Reports
At least quarterly in each year this Plan remains in effect, the Fund's
Principal Accounting Officer or Treasurer, or such other person authorized to
direct the disposition of monies paid or payable by the Fund, shall prepare and
furnish to the Trustees of the Fund for their review, and the Trustees shall
review, a written report complying with the requirements of Rule 12b-l under the
Act regarding the amounts expended under this Plan and the purposes for which
such expenditures were made.
4. Required Approval
This Plan shall not take effect until it, together with any related
agreement, has been approved by a vote of at least a majority of the Fund's
Trustees as well as a vote of at least a majority of the Trustees of the Fund
who are not interested persons (as defined in the Act) of the Fund and who have
no direct or indirect financial interest in the operation of this Plan or in any
related agreement (the "Disinterested Trustees"), cast in person at a meeting
called for the purpose of voting on this Plan or any related agreement and this
Plan shall not take effect with respect to the Fund until it has been approved
by a vote of at least a majority of the outstanding voting Class A shares (as
such phrase is defined in the Act).
<PAGE>
5. Term
This Plan shall remain in effect for one year from the date of its
adoption and may be continued thereafter if specifically approved at least
annually by a vote of at least a majority of the Trustees of the Fund as well as
a majority of the Disinterested Trustees. This Plan may be amended at any time,
provided that (a) the Plan may not be amended to increase materially the amount
of the distribution expenses provided in Paragraph 2 hereof (including the
Service Fee) without the approval of at least a majority of the outstanding
voting securities (as defined in the Act) of the Class A shares of the Fund and
(b) all material amendments to this Plan must be approved by a majority vote of
the Trustees of the Fund and of the Disinterested Trustees cast in person at a
meeting called for the purpose of such vote.
6. Selection of Disinterested Trustees
While this Plan is in effect, the selection and nomination of Trustees
who are not interested persons (as defined in the Act) of the Fund shall be
committed to the discretion of the Disinterested Trustees then in office.
7. Related Agreements
Any related agreement shall be in writing and shall provide that (a)
such agreement shall be subject to termination, without penalty, by vote of a
majority of the outstanding voting securities (as defined in the Act) of the
Class A shares of the Fund on not more than 60 days' written notice to the other
party to the agreement and (b) such agreement shall terminate automatically in
the event of its assignment.
8. Termination
This Plan may be terminated at any time by a vote of a majority of the
Disinterested Trustees or by a vote of a majority of the outstanding voting
securities (as defined in the Act) of the Class A shares of the Fund. In the
event this Plan is terminated or otherwise discontinued, no further payments
hereunder will be made hereunder.
9. Records
The Fund shall preserve copies of this Plan and any related agreements
and all reports made pursuant to Paragraph 3 hereof, and any other information,
estimates, projections and other materials that serve as a basis therefor,
considered by the Trustees of the Fund, for a period of not less than six years
from the date of this Plan, the agreement or report, as the case may be, the
first two years in an easily accessible place.
10. Non-Recourse
The Fund's Declaration of Trust dated October 15, 1987, a copy of
which, together with the amendments thereto ("Declaration"), is on file in the
office of the Secretary of the Commonwealth of Massachusetts, refers to the
Trustees under the Declaration of Trust collectively as Trustees, but not as
individuals or personally, and no Trustee, shareholder, officer, employee or
agent of the Fund may be held to any personal liability, nor may any resort be
had to their private property for the satisfaction of any obligation or claim or
otherwise in connection with the affairs of the Fund but the Fund property only
shall be liable.
[Adopted at a duly held meeting of the Board of Trustees on August 27, 1997.]
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<PAGE>
PHOENIX MULTI-PORTFOLIO FUND
101 Munson Street
Greenfield, Massachusetts 01301
Proxy for an Adjourned Special Meeting of Shareholders
October 30, 1997
PROXY
The undersigned shareholder of Phoenix Multi-Portfolio Trust (the
"Trust"), revoking any and all previous proxies heretofore given for shares of
the Trust held by the undersigned, hereby constitutes and appoints Philip R.
McLoughlin, Thomas N. Steenburg and William E. Keen, III, and any and each of
them, proxies and attorneys of the undersigned, with power of substitution to
each, for and in the name of the undersigned to vote and act upon all matters
(unless and except as expressly limited below) at the Adjourned Special Meeting
of Shareholders of the Trust to be held on October 30, 1997 at 827 Williams
Street, Longmeadow, Massachusetts, and at any and all adjournments thereof, with
respect to all shares of the Trust for which the undersigned is entitled to
provide instructions or with respect to which the undersigned would be entitled
to provide instructions or act, with all the powers the undersigned would
possess if personally present and to vote with respect to specific matters as
set forth below on the reverse. Any proxies heretofore given by the undersigned
with respect to said meeting are hereby revised.
To avoid the expense of adjourning the Meeting to a subsequent date, please
return this proxy in the enclosed self addressed, postage-paid envelope.
This proxy, if properly executed, will be voted in the manner as directed herein
by the undersigned shareholder. Unless otherwise specified in the squares
provided, the undersigned's vote will be cast "FOR" each Proposal. If no
direction is made for any Proposals, this proxy will be voted "FOR" any and all
such Proposals.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF THE FUND WHICH
RECOMMENDS A VOTE "FOR" EACH OF THE PROPOSALS
<PAGE>
|X| Please mark votes as in this Example.
PROPOSAL 1.
TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT PROVIDING FOR CHANGES TO THE FEES
TO THE INVESTMENT ADVISER.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2A.
TO APPROVE A CHANGE IN INVESTMENT OBJECTIVE.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2B.
TO APPROVE THE REVISIONS IN THE RESTRICTIONS ON THE USE OF CALL AND PUT OPTIONS,
FUTURES CONTRACTS AND RELATED OPTIONS TO INCREASE THE APPLICABLE LIMIT TO 5% NET
ASSETS.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2C.
TO APPROVE THE ELIMINATION OF A RESTRICTION ON THE USE OF FUTURES CONTRACTS AND
RELATED OPTIONS.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2D.
TO APPROVE THE ELIMINATION OF RESTRICTIONS ON INVESTMENTS IN THE SECURITIES OF
ANY ISSUER WITH A RECORD OF LESS THAN THREE YEARS OF CONTINUOUS OPERATIONS.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2E.
TO APPROVE THE INCREASE IN THE LIMITATION ON THE USE OF ILLIQUID SECURITIES FROM
10% OF TOTAL ASSETS TO 15% OF NET ASSETS AND TO ELIMINATE THE RESTRICTION ON THE
PURCHASE OF RESTRICTED SECURITIES.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 2F.
TO APPROVE THE ELIMINATION OF THE LIMITATION ON THE USE OF REPURCHASE
AGREEMENTS.
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL 3.
TO APPROVE THE ADOPTION OF A SERVICE FEE PLAN.
|_| FOR |_| AGAINST |_| ABSTAIN
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<PAGE>
-------------------
Please be sure to sign and date this Proxy. Date
- ------------------------------------------------------------ -------------------
- --------------------------------------------------------------------------------
Shareholder sign here Co-owner sign here
- --------------------------------------------------------------------------------
NOTE: Please sign exactly as your name appears hereon. If shares are registered
in more than one name, all registered shareholders should sign this proxy; but
if one shareholder signs, this signature binds the other shareholder. When
signing as an attorney, executor, administrator, agent, trustee, or guardian, or
custodian for a minor, please give full title as such. If a corporation, please
sign in full corporate name by an authorized person. If a partnership, please
sign in partnership name by an authorized person.
This proxy may be revoked by the shareholder(s) at any time prior to the Special
Meeting in lieu of the Annual Meeting.
RECORD DATE SHARES:
3
