<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
ENTERPRISE ACCUMULATION TRUST
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
ENTERPRISE ACCUMULATION TRUST
---------------------
NOTICE OF SPECIAL MEETING OF CONTRACTHOLDERS
TO BE HELD ON APRIL 28, 1997
---------------------
TO THE CONTRACTHOLDERS:
Notice is hereby given that a special meeting of Contractholders (the
"Meeting") of ENTERPRISE ACCUMULATION TRUST, (the "Trust"), will be held at the
offices of the Trust, 3343 Peachtree Road, NE, Suite 450, Atlanta, Georgia
30326, on April 28, 1997 at 2:00 p.m., Eastern Standard Time, for the following
purposes:
1. For each Portfolio, to approve or disapprove a change to its
fundamental investment restrictions with respect to diversification;
2. For each Portfolio, to approve or disapprove a proposal to permit
Enterprise Capital Management, Inc. ("Enterprise Capital") to enter into
new or amended contracts with Portfolio Managers without obtaining
Contractholder approval;
3. For the Managed Portfolio, to approve or disapprove a Portfolio
Manager's Agreement between the Trust, Enterprise Capital and OpCap
Advisors ("OpCap") whereby the management fee paid by Enterprise Capital to
OpCap would be reduced to .25 of 1% per year for assets under management in
excess of $2 billion;
4. For each of the Equity and Managed Portfolios, to approve or
disapprove a Portfolio Manager's Agreement between the Trust, Enterprise
Capital and OpCap to become effective upon the consummation of a
transaction involving certain assets of OpCap's parent, Oppenheimer Capital
and PIMCO Advisors L.P. ("PIMCO");
5. To act upon such other matters as properly may come before the
Meeting or any adjournment or adjournments thereof.
The close of business of March 11, 1997 has been fixed as the record date
for the determination of Contractholders entitled to notice of and to vote at
the Meeting and any adjournments thereof. Your attention is called to the
accompanying Proxy Statement. Regardless of whether you plan to attend the
Meeting, PLEASE COMPLETE, SIGN AND RETURN PROMPTLY THE ENCLOSED VOTING
INSTRUCTION FORM. If you are present at the Meeting, you may change your vote,
if desired, at that time.
CATHERINE R. MC CLELLAN
Secretary
March 29, 1997
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED VOTING INSTRUCTION FORM/FORMS
IN THE ENCLOSED POSTAGE PAID ENVELOPE SO THAT YOU MAY BE SURE YOUR SHARES WILL
BE REPRESENTED AT THE MEETING.
<PAGE> 3
YOUR VOTE IS IMPORTANT
PLEASE RETURN YOUR VOTING INSTRUCTIONS FORM PROMPTLY
Contractholders who do not expect to attend the Meeting are requested to
indicate voting instructions on the enclosed voting instruction form for each
Portfolio of the Trust in which they own shares and to date, sign and return it
in the envelope provided, which needs no postage if mailed in the United States.
In order to avoid unnecessary expense, we ask for your cooperation in mailing in
your voting instruction form no matter how large or small your holding may be.
<PAGE> 4
ENTERPRISE ACCUMULATION TRUST
ATLANTA FINANCIAL CENTER
3343 PEACHTREE ROAD, NE, SUITE 450
ATLANTA, GEORGIA 30326
---------------------
PROXY STATEMENT
---------------------
SPECIAL MEETING OF CONTRACTHOLDERS
TO BE HELD ON APRIL 28, 1997
---------------------
GENERAL
This Proxy Statement is furnished to the Contractholders of Enterprise
Accumulation Trust, a Massachusetts business trust (the "Trust"), in connection
with the solicitation by the Board of Trustees of proxies to be used at a
special meeting (the "Meeting") of Contractholders to be held on April 28, 1997,
or any adjournment or adjournments thereof. The Notice of Meeting, Proxy
Statement and Voting Instruction Form will first be mailed on or about March 29,
1997.
Shares of beneficial interest ("Shares") of the Trust are presently sold to
The Mutual Life Insurance Company of New York ("MONY") and its affiliate, MONY
Life Insurance Company of America ("MONY America"), for allocation to variable
accounts established by MONY and MONY America (collectively the "Variable
Accounts") to provide benefits to Contractholders ("Contractholders") of
variable annuity and variable life insurance contracts ("Contracts") issued by
those companies. Instructions of Contractholders are being solicited for the
approval or disapproval of each Proposal described below. The Trust consists of
five portfolios ("Portfolios"), which are being asked to vote on the proposals
as follows:
<TABLE>
<CAPTION>
PROPOSAL PORTFOLIO
-------- ---------
<C> <S> <C>
1. To approve or disapprove a fundamental All Portfolios
investment restriction relating to
diversification
2. To approve or disapprove a Proposal to permit All Portfolios
Enterprise Capital Management, Inc.
("Enterprise Capital") to enter into new or
amended contracts with Portfolio Managers
without Contractholder approval.
3. To approve or disapprove Portfolio Manager's Managed Portfolio
Agreement between the Trust, Enterprise
Capital and OpCap Advisors ("OpCap"), with a
management fee reduction to .25% of 1% per
year for assets under management in excess of
$2 billion.
4. To approve or disapprove a Portfolio Equity and Managed Portfolios
Manager's Agreement between the Trust,
Enterprise Capital and OpCap to become
effective upon the consummation of a
transaction involving certain assets of
OpCap's parent, Oppenheimer Capital, and
PIMCO Advisors L.P. ("PIMCO")
</TABLE>
1
<PAGE> 5
SHARE OWNERSHIP
Each Portfolio is a separate series of shares of beneficial interest of the
Trust: the Equity Portfolio, Small Cap Portfolio, Managed Portfolio,
International Growth Portfolio, and High-Yield Bond Portfolio.
As of March 11, 1997 (the "Record Date"), the number of outstanding shares
of each Portfolio is as follows:
<TABLE>
<CAPTION>
PORTFOLIO OUTSTANDING
- --------- -----------
<S> <C>
Equity...................................................... 11,730,847
Small Cap................................................... 9,684,129
Managed..................................................... 58,374,215
International Growth........................................ 9,627,486
High-Yield Bond............................................. 6,998,282
</TABLE>
As of the Record Date, MONY and MONY America owned all of the outstanding
shares of the Trust. Although shares held by the Variable Accounts generally
will be voted in accordance with instructions received from Contractholders, as
discussed below, the Trust might nevertheless be deemed to be controlled by MONY
and MONY America by virtue of the definition of "control" contained in the
Investment Company Act of 1940, as amended (the "Investment Company Act"). MONY
and MONY America disclaim such control.
To the knowledge of the Trust, as of the Record Date, no single person or
"group" (as such term is used in Section 13(d) of the Securities Exchange Act of
1934), had the power to direct the vote of more than 5% of any Portfolio's
outstanding shares. As of the Record Date, Trustees and officers of the Trust as
a group beneficially owned none of the Trust's outstanding shares.
PROXIES AND VOTING
In order that you may be represented at the Meeting or any adjournment or
adjournments thereof, you are requested to indicate your voting instructions on
the enclosed voting instruction form, to date and sign the form, and to mail the
form promptly in the enclosed postage paid envelope, allowing sufficient time
for the form to be received before the Meeting. Abstentions will be counted as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum and will have the effect of a negative vote.
A quorum for the Meeting will consist of a majority of the shares issued
and outstanding and entitled to vote in person or be represented by proxy. If,
by the time scheduled for the Meeting, a quorum is not present or if a quorum is
present but sufficient voting instructions in favor of the proposals described
in this Proxy Statement are not received from Contractholders, MONY or MONY
America may propose one or more adjournments of the Meeting to permit further
solicitation of voting instructions from Contractholders. Any such adjournment
will require the affirmative vote of a majority of the shares of the Trust
present in person or by proxy at the session of the Meeting to be adjourned. The
persons named as proxies will vote in favor of any such adjournment if they
determine that such adjournment and additional solicitation are reasonable and
in the interests of each Portfolio's Contractholders.
Shares of each Portfolio will be voted separately on each Proposal, with
each Portfolio voting as a single class. Approval of each proposal will require
the affirmative vote of the lesser of (1) more than 50% of the outstanding
shares of each respective Portfolio, or (2) 67% or more of the shares of such
Portfolio present at
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<PAGE> 6
the meeting, in person or by proxy, if the holders of 50% or more of the
outstanding shares of such Portfolio are present or represented by proxy.
MONY and MONY America will vote shares of the Portfolios allocated to
subaccounts ("Subaccounts") of their respective Variable Accounts which
correspond to the Portfolios based on instructions received from the
Contractholders of such Variable Account having the voting interest in the
corresponding number of shares of each Portfolio held in such Variable Account.
Each Contractholder will have the equivalent of one voting instruction per $100
of value attributable to each of the contracts held with fractional voting
instructions for amounts less than $100. These voting instructions, represented
as votes per $100 of value in each of the Subaccounts of the Variable Accounts,
will be converted into a proportionate number of votes in shares of each of the
corresponding Portfolios of the Trust. Shares for which no instructions are
received in time to be voted will be voted by the record holder in the same
proportion as instructions which have been received in time to be voted. If
required by state insurance officials, a Variable Account may disregard voting
instructions in certain instances.
Voting instructions may be revoked at any time prior to the voting thereof
by: (i) written instructions addressed to the Secretary of the Trust at
Enterprise Capital Management, Inc., 3343 Peachtree Road, NE, Suite 450,
Atlanta, Georgia 30326; (ii) attendance at the Meeting and voting in person or
(iii) properly executing and returning a new voting instruction form (if
received in time to be voted). Mere attendance at the Meeting will not revoke
voting instructions.
All expenses of the preparation and distribution of these proxy materials
will be borne by the Trust and OpCap. In addition to the solicitation of voting
instructions by the use of the mails, voting instructions may be solicited by
officers and employees of Enterprise Capital or its affiliates, or of MONY or
its affiliates, personally or by telephone or telegraph or by one or more proxy
soliciting firms. Brokerage houses, banks and other fiduciaries may be requested
to forward soliciting material to their principals and to obtain authorization
for the execution of voting instruction forms. For those services, they will be
reimbursed by Enterprise Capital and MONY for their out-of-pocket expenses.
All information contained in this Proxy Statement concerning the Trust,
Enterprise Capital, OpCap or affiliates of Enterprise Capital or OpCap has been
supplied by each of such persons, respectively. All information contained in
this Proxy Statement regarding MONY or MONY America or their respective
affiliates has been supplied by MONY.
PROPOSAL NO. 1
APPROVAL OR DISAPPROVAL OF PROPOSAL TO AMEND
FUNDAMENTAL INVESTMENT RESTRICTION RELATING TO DIVERSIFICATION
The Meeting has been called to consider a proposal to amend a fundamental
investment restriction of each Portfolio. The Board of Trustees approved this
proposal at a meeting held on February 20, 1997.
The Trustees recommend that Contractholders approve the change to the
fundamental investment restriction as described below. A fundamental investment
restriction may be changed only with contractholders approval.
Each Portfolio of the Trust has adopted a fundamental investment policy
whereby no Portfolio will invest more than 5% of the value of its total assets
in the securities of any single issuer other than cash items and U.S. government
securities, as defined in the Investment Company Act of 1940 ("1940 Act"). Con-
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<PAGE> 7
tractholders are asked to vote on a Proposal to modify this existing fundamental
restriction of each Portfolio to limit this policy as to 75% of the total assets
of each Portfolio. The amended restriction would read as follows:
No Portfolio will, as to 75% of the assets of each Portfolio, invest
more than 5% of the value of its total assets in the securities of any
single issuer other than cash items and U.S. government securities, (as
defined in the Investment Company Act of 1940).
Each Portfolio's investment restriction relating to investments in a single
issuer was initially adopted due to regulatory requirements at such time.
Current regulatory requirements no longer mandate that an investment company's
policy apply to 100% of the total assets of each Portfolio. The Trustees believe
that limiting this investment restriction to 75% of the total assets of each
Portfolio would provide the Portfolios with needed flexibility to respond, as
appropriate, to beneficial investment opportunities while maintaining
diversification as to 75% of the total assets of each Portfolio.
Notwithstanding the foregoing, there is no present intention to make any
change in the way in which any Portfolio is managed.
If the proposed change to the Trust's investment restriction is approved by
Contractholders at the Meeting, the Trust's prospectus and statement of
additional information will be revised as appropriate to reflect those changes.
This Proposal No. 1 will not result in a change to the investment objective of
any Portfolio of the Trust.
If Proposal No. 1 is not approved by the Contractholders of any particular
Portfolio of the Trust, the existing fundamental restriction regarding
investment in a single issuer will continue in effect for that Portfolio of the
Trust.
THE BOARD OF TRUSTEES RECOMMENDS THAT CONTRACTHOLDERS VOTE "FOR" PROPOSAL NO. 1.
PROPOSAL NO. 2
APPROVAL OR DISAPPROVAL OF PROPOSAL TO PERMIT
ENTERPRISE CAPITAL MANAGEMENT, INC. TO
ENTER INTO NEW OR AMENDED CONTRACTS WITH
PORTFOLIO MANAGERS WITHOUT OBTAINING
CONTRACTHOLDER APPROVAL
The Board of Trustees of the Trust is submitting for approval by the
Contractholders of each of the Portfolios a proposal to permit Enterprise
Capital to enter into new or amended contracts with Portfolio Managers without
obtaining Contractholder approval. On February 22, 1996, the Board of Trustees
discussed and approved this proposal at an in-person meeting.
The Board recommends that Contractholders of each Portfolio approve a
proposal which would permit Enterprise Capital from time to time to enter into a
new or materially amended Portfolio Manager Agreement with a Portfolio Manager
(i.e., a subadviser) to the Portfolio without obtaining Contractholder approval.
Approval by the Trustees, including a majority of Independent Trustees, who are
not "interested persons" of the Trust within the meaning of the 1940 Act
("Independent Trustees") will continue to be required to approve any new or
amended Advisory Agreement. The proposal will apply to any Portfolio Manager
Agreement entered into by Enterprise Capital with a Portfolio Manager that is
not otherwise an affiliated
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<PAGE> 8
person (as defined in Section 2(a)(3) of the 1940 Act) of the Trust or
Enterprise Capital, other than by reason of serving as a Portfolio Manager (a
"Portfolio Manager"). Among other changes, the proposal would cover new
Portfolio Manager Agreements necessitated because the prior Portfolio Manager
Agreements were terminated as a result of an "assignment" (as defined in the
1940 Act), an amendment to a Portfolio Manager Agreement or a new Portfolio
Manager Agreement to substitute a new Portfolio Manager for an old Portfolio
Manager.
This Proposal is being submitted to Contractholders pursuant to the
requirements of an Exemptive Order (the "Order") obtained from the Securities
and Exchange Commission (the "Commission") on December 10, 1996. The Order
grants exemptive relief from certain provisions of the 1940 Act and certain
rules thereunder and is discussed below.
REASONS WHY CONTRACTHOLDERS APPROVAL IS SOUGHT
Section 15 of the 1940 Act makes it unlawful for any person to act as
investment adviser to an investment company except pursuant to a written
contract which has been approved by shareholders. For purposes of Section 15,
the term "investment adviser" includes any Portfolio Manager to an investment
company. Section 15 also requires that an Investment Advisory Agreement provide
that it will terminate automatically upon its assignment. "Assignment," for
purposes of the 1940 Act, includes in substance the transfer of an Advisory
Agreement or the transfer of control of the investment adviser through the
transfer of a controlling block of the adviser's outstanding voting securities.
In conformity with Section 15 of the 1940 Act, the Trust currently obtains
Contractholders' approval of a Portfolio Manager Agreement in three general
situations:
A. The employment of a new Portfolio Manager: (i) to replace an
existing Portfolio Manager; (ii) as an additional Portfolio Manager; or
(iii) to act as Portfolio Manager for new Portfolio;
B. A change in the terms of a Portfolio Manager Agreement; and
C. The continued employment of an existing Portfolio Manager on the
same terms where there has been or is expected to be an assignment of a
Portfolio Manager Agreement as a result of a change of control of the
Portfolio Manager.
Enterprise Capital may currently terminate a Portfolio Manager Agreement
without Contractholder approval. Contractholders of a Portfolio may also
currently terminate a Portfolio Manager Agreement with respect to that Portfolio
at any time by a vote of a majority of the Portfolio's outstanding shares, as
defined in the 1940 Act. The proposed OpCap Advisors Portfolio Manager's
Agreement that is described in Proposal No. 3 is an example of the type of new
or amended Portfolio Manager Agreement that would no longer require
Contractholder approval if this Proposal No. 2 is approved, subject to
compliance with the other conditions of the Order, which are set forth below.
DISCUSSION
As a "multi-manager" type of investment company, Trust employs Enterprise
Capital subject to the supervision of the Trustees, to manage or provide for the
management of each Portfolio. Enterprise Capital selects a Portfolio Manager to
invest the assets of each Portfolio, subject to the review and approval of the
Trustees, and, currently, subject to the approval of each Portfolio's
Contractholders, and on an ongoing basis reviews the Portfolio Manager's
performance. Enterprise Capital is responsible for communicating performance,
expectations and evaluations to the Portfolio Manager and for recommending to
the Trustees whether
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<PAGE> 9
the Portfolio Manager's contract should be renewed, modified or terminated. The
Portfolio Manager is entitled to receive a fee from Enterprise Capital.
Enterprise Capital and the Trustees believe that requiring Contractholders to
approve changes in a Portfolio Manager and to the Portfolio Manager Agreement
(including continuation of an assigned subadvisory agreement) not only results
in unnecessary administrative expenses to each Portfolio, but may also cause
harmful delays in executing changes that Enterprise Capital and the Trustees
have determined are necessary or desirable. Enterprise Capital and the Trustees
believe that such expenses, and the possibility of delays, may result in
Contractholders receiving less satisfactory service than would be the case if
this proposal is implemented.
Accordingly, the Trust obtained the Order. Pursuant to the Order, subject
to receipt of approval of this Proposal 2 and the other conditions described
below, the Contractholders of each Portfolio will receive an information
statement complying with certain provisions of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the rules promulgated thereunder,
following a change of Portfolio Manager and/or the entry into a new or amended
Portfolio Manager Agreement that would have otherwise required Contractholder
approval. The information statement will contain substantially all of the
information about the Portfolio Manager and the Portfolio Manager Agreement that
would otherwise be contained in a written proxy statement. The information
statement will include disclosure as to the level of fees to be paid to
Enterprise Capital and the Portfolio Manager and will disclose Portfolio Manager
changes or changes to a Portfolio Manager Agreement.
Enterprise Capital intends that the information statement described above,
as well as adherence to the conditions of the Order as set forth below, will
protect Contractholders of each Portfolio, including by enabling Portfolio
Contractholders to receive adequate disclosure about the Portfolio Manager. If
the Proposal No. 2 is approved, amendments to the Advisory Agreement between
Enterprise Capital and the Trust will remain subject to Contractholder and
Trustees approval requirements of Section 15 of the 1940 Act and related proxy
disclosure requirements. Moreover, although approval of the proposal will
generally permit Enterprise Capital and the Trustees to change the fees payable
to a Portfolio Manager without Contractholder approval, such changes will not
permit Enterprise Capital and the Trustees to increase the rate of the fees
payable by each Portfolio to Enterprise Capital without first obtaining
Contractholder approval.
The Trustees believe that approval of the proposal to permit Enterprise
Capital to enter into new or amended contracts with Portfolio Managers without
obtaining Contractholders' approval is in the best interests of the
Contractholders of each Portfolio. If Proposal No. 2 is not approved by
Contractholders of any Portfolio, the Order obtained by the Trust will have no
effect with respect to that Portfolio. In such event, Contractholders of such
Portfolio would continue to have to approve any new or amended Portfolio Manager
Agreements entered into by Enterprise Capital with respect to such Portfolio.
CONDITIONS
The Order grants Trust relief from Section 15(a) of the 1940 Act and a rule
thereunder in order for the Trust and its Portfolio to operate in the manner
described in this Proposal, subject to certain conditions including approval of
this Proposal by Contractholders of each Portfolio. The Trust will not rely on
the Order until all such conditions have been met.
The conditions for the relief are as follow:
1. Enterprise Capital will provide general management and
administrative services to the Trust, including overall supervisory
responsibility for the general management and investment of the Trust's
securities Portfolios, and, subject to review and approval by the Board of
Trustees with respect to each
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Portfolio, will (a) set a Portfolio's overall investment strategies; (b)
select Portfolio Managers; (c) monitor and evaluate the performance of
Portfolio Managers; (d) allocate and, when appropriate, reallocate a
Portfolio's assets among its Portfolio Managers in those cases where a
Portfolio has more than one Portfolio Manager; and (e) implement procedures
reasonably designed to ensure that the Portfolio Managers comply with each
respective Portfolio's investment objectives, policies, and restrictions.
2. Before a Portfolio may rely on the Order, the operation of the
Portfolio in the manner described in the application will be approved by a
majority of the Contractholders of any separate account for which the Trust
serves as a funding medium, as defined in the 1940 Act, or, in the case of
a new Portfolio whose public Contractholders purchased shares on the basis
of a prospectus containing the disclosure contemplated by condition 4
below, by the sole shareholder before the offer of shares of such Portfolio
to the public.
3. The Trust will furnish to its Contractholders all information about
a new Portfolio Manager or Portfolio Manager Agreement for a Portfolio that
would be included in a proxy statement. Such information will include
disclosure as to the level of fees to be paid to Enterprise Capital and
each Portfolio Managers of the Portfolio and any change in such disclosure
caused by the addition of a new Portfolio Manager or any proposed materials
change in a Portfolio Manager Agreement. The Trust will meet this condition
by providing its Contractholders with an informal information statement
complying with the provisions of regulation 14C under the Exchange Act and
Schedule 14C thereunder. With respect to the newly retained Portfolio
Manager, or a change in a Portfolio Manager Agreement, this information
statement will be provided to Contractholder of the Portfolio a maximum of
sixty (60) days after the addition of the new Portfolio Manager or the
implementation of any change in a Portfolio Manager Agreement. The
information statement will also meet the requirements of Schedule 14A under
the Exchange Act. The Trust will ensure that the information statement is
furnished to unitholders of any separate account for which the Trust serves
as a funding medium.
4. The Trust will disclose in its prospectus the existence, substance
and effect of the Order. In addition, each Portfolio will hold itself out
to the public as employing the "manager of managers" approach described in
the application. The Prospectus and any sales materials or other
shareholder communications relating to a Portfolio of the Trust will
prominently disclose that Enterprise Capital has ultimate responsibility
for investment performance of the Portfolio due to its responsibility to
oversee Portfolio Managers and recommend their hiring, termination and
replacement.
5. No Trustee or officer of the Trust or director or officer of
Enterprise Capital will own directly or indirectly (other than through a
pooled investment vehicle that is not controlled by any such Trustee,
director or officer) any interest in any Portfolio Manager except for (a)
ownership of interests in Enterprise Capital or any entity that controls,
is controlled by or is under common control with Enterprise Capital; or (b)
ownership of less than 1% of the outstanding securities of any class of
equity or debt of a publicly-traded company that is either a Portfolio
Manager or any entity that controls, is controlled by or is under common
control with a Portfolio Manager.
6. Enterprise Capital will not enter into a Portfolio Manager
Agreement with any Affiliated Portfolio Manager without such agreement,
including the compensation to be paid thereunder, being approved by the
Contractholders of the applicable Portfolio.
7. At all times, a majority of the members of the Board will be
persons each of whom is an Independent Trustee of the Trust, as defined in
Section 2(a)(19) of the 1940 Act, and the nomination of
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new or additional Independent Trustees will be placed within the discretion
of the then existing Independent Trustees.
8. When a Portfolio Manager change is proposed for a Portfolio with an
Affiliated Portfolio Manager, the Board, including a majority of the
Independent Trustees, will make a separate finding, reflected in the
Board's minutes, that such change is in the best interest of the Portfolio
and the Contractholders of any separate account for which the Trust serves
as a funding medium and does not involve a conflict of interest from which
Enterprise Capital or the Affiliated Portfolio Manager derives an
inappropriate advantage.
THE BOARD OF TRUSTEES RECOMMENDS THAT CONTRACTHOLDERS VOTE "FOR" PROPOSAL NO. 2.
PROPOSAL NO. 3
APPROVAL OR DISAPPROVAL OF NEW PORTFOLIO MANAGER'S AGREEMENT
BETWEEN THE TRUST, ENTERPRISE CAPITAL AND OPCAP
INCORPORATING A REDUCTION IN THE MANAGEMENT FEE PAID TO OPCAP
AS TO THE MANAGED PORTFOLIO
BACKGROUND
General. The Meeting has been called for the purpose of considering a new
Portfolio Manager's Agreement for each of the Equity and Managed Portfolios
incorporating a proposed reduction in the Portfolio Manager fee paid by
Enterprise Capital to OpCap Advisors ("OpCap") for services rendered to the
Managed Portfolio for assets under management in excess of $2,000,000,000.
Accordingly, Contractholders are being asked to approve a new Portfolio
Manager's Agreement (the "New Portfolio Manager's Agreement") embodying exactly
the same terms as the current Portfolio Manager's Agreement for such Portfolios
but with a reduced fee for the Portfolio Manager as to the Managed Portfolio.
The Fund's Board of Trustees has approved the New Portfolio Manager's Agreement,
subject to approval by the Contractholders of the Portfolio. The net effect of
the fee reduction will not impact the overall fee charged to Contractholders of
the Managed Portfolio.
EXISTING PORTFOLIO MANAGER'S AGREEMENT
OpCap Advisors currently serves as Portfolio Manager for the Portfolio
under an Investment Advisory Agreement (the "Existing Portfolio Manager's
Agreement") dated May 31, 1996. The Board of Trustees, including a majority of
the Trustees who are not "interested persons" of the Trust or any party to the
Agreement, most recently voted to renew the Existing Portfolio Manager's
Agreement on February 20, 1997. Under the Existing Portfolio Manager's
Agreement, OpCap Advisors is entitled to receive Portfolio Manager fees for each
of the Equity and Managed Portfolios at the annual rate of 0.40% of the average
of the daily closing net asset values of the Portfolio per year, paid monthly
for assets up to $1,000,000,000; and 0.30% thereafter.
NEW PORTFOLIO MANAGER'S AGREEMENT
Except for a different fee schedule, the terms of the New Portfolio
Manager's Agreement are identical in all respects to the terms of the Existing
Portfolio Manager's Agreement. A form of the New Portfolio
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Manager's Agreement is attached to this Proxy Statement as Exhibit A, and the
description set forth in this Proxy Statement of the New Portfolio Manager's
Agreement is qualified in its entirety by reference to Exhibit A.
Under the New Portfolio Manager's Agreement, the Portfolio Manager will
provide certain investment advisory services to the Portfolio, including
deciding what securities will be purchased and sold by the Portfolio, when such
purchases and sales are to be made, and arranging for such purchases and sales,
all in accordance with the provisions of the 1940 Act, as amended (the
"Investment Company Act") and any rules thereunder, the governing documents of
the Trust, the fundamental policies of the Trust and Portfolio, as reflected in
its registration statement, and any policies and determinations of the Board of
Trustees of the Trust.
As compensation for its services to the Managed Portfolio under the New
Portfolio Manager's Agreement, the Portfolio Manager will be entitled to receive
from Enterprise Capital fees as for services to the Managed Portfolio calculated
at the following annual rates based upon average daily net assets: 0.40% for the
first $1 billion under management, 0.30% for assets from $1 billion to $2
billion; and 0.25% thereafter. The New Portfolio Manager's Agreement will
continue in effect for two years from its effective date, and will continue in
effect thereafter for successive annual periods, provided its continuance is
specifically approved at least annually by (1) a majority vote, cast in person
at a meeting called for that purpose, of the Trust's Board of Trustees or (2) a
vote of the holders of a majority (as defined in the Investment Company Act and
the rules thereunder) of the outstanding voting securities of the Portfolio, and
(3) in either event by a majority of the Trustees who are not parties to the New
Portfolio Manager's Agreement or interested persons of the Trust or of any such
party. The New Portfolio Manager's Agreement provides that it may be terminated
at any time, without penalty, by either party or by the Trust upon 60 days
written notice, provided that such termination by the Portfolio shall be
directed or approved by a vote of the Trustees of the Trust, or by a vote of
holders of a majority of the shares of the Portfolio.
The overall management fee of the Managed Portfolio paid to Enterprise
Capital is 0.80% of the average daily net assets up to $400 million; 0.75% of
average daily net assets from $400 million to $800 million; and 0.70% of average
daily net assets in excess of $800 million. Fees paid to Enterprise Capital for
management services for the Managed Portfolio during 1996 were $11,086,850.
Under the terms of the new Portfolio Manager's Agreement, Enterprise Capital
would be entitled to retain an additional 0.05% of the management fee for assets
under management in the Managed Portfolio.
TRUSTEES' CONSIDERATION
The Board of Trustees believes that the terms of the New Portfolio
Manager's Agreement are fair to, and in the best interests of, the Trust, the
Portfolio, and their Contractholders. The Board of Trustees, including all of
the Independent Trustees, recommends approval by the Contractholders of the New
Agreement among OpCap Advisors, Enterprise Capital and the Portfolio. In making
this recommendation, the Trustees carefully evaluated the experience of the
Portfolio Manager's key personnel in institutional investing, the quality of
services the Portfolio Manager is expected to provide and has provided to the
Portfolio, and the compensation proposed to be paid to the Portfolio Manager,
and have given careful consideration to all factors deemed to be relevant to the
Portfolio, including, but not limited to: (1) the fee and expense ratios of
comparable mutual funds; (2) the performance of the Portfolio since commencement
of operations; (3) the nature and quality of the services expected to be
rendered to the Portfolio by the Portfolio Manager; (4) that the terms of the
Existing Portfolio Manager's Agreement will be unchanged under the New Portfolio
Manager's Agreement except for the different fee; (5) the history, reputation,
qualification and background of the Portfolio Manager,
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as well as the qualifications of its personnel and their respective financial
conditions; and (6) other factors deemed relevant.
THE BOARD OF TRUSTEES RECOMMENDS THAT CONTRACTHOLDERS VOTE "FOR" PROPOSAL NO. 3.
PROPOSAL NO. 4
APPROVAL OR DISAPPROVAL OF NEW PORTFOLIO
MANAGER'S AGREEMENT BETWEEN THE TRUST,
ENTERPRISE CAPITAL AND OPCAP
BACKGROUND
General. The Meeting has been called for the purpose of considering a new
Portfolio Manager's Agreement for the Equity Portfolio and the Managed Portfolio
as a result of a proposed transaction which if consummated, would result in a
change of control of Oppenheimer Capital, the parent of OpCap. Accordingly,
Contractholders are being asked to approve a new Portfolio Manager's Agreement
(the "New Portfolio Manager's Agreement") embodying exactly the same terms as
the current Portfolio Manager Agreement for such Portfolios but with a reduced
fee for the Portfolio Manager as to the Managed Portfolio.
EXISTING PORTFOLIO MANAGER'S AGREEMENT
OpCap Advisors currently serves as Portfolio Manager for the Portfolio
under an Investment Advisory Agreement (the "Existing Portfolio Manager's
Agreement") dated May 31, 1996. The Board of Trustees, including a majority of
the Trustees who are not "interested persons" of the Trust or any party to the
Agreement, most recently voted to renew the Existing Portfolio Manager's
Agreement on February 20, 1997. Under the Existing Portfolio Manager's
Agreement, OpCap Advisors is entitled to receive Portfolio Manager fees for each
of the Equity and Managed Portfolios at the annual rate of 0.40% of the average
of the daily closing net asset values of the Portfolio per year, paid monthly
for assets up to $1,000,000,000; and 0.30% thereafter.
NEW PORTFOLIO MANAGER'S AGREEMENT
Except for a different fee schedule, the terms of the New Portfolio
Manager's Agreement are identical in all respects to the terms of the Existing
Portfolio Manager's Agreement. A form of the New Portfolio Manager's Agreement
is attached to this Proxy Statement as Exhibit A, and the description set forth
in this Proxy Statement of the New Portfolio Manager's Agreement is qualified in
its entirety by reference to Exhibit A.
Under the New Portfolio Manager's Agreement, the Portfolio Manager will
provide certain investment advisory services to the Portfolio, including
deciding what securities will be purchased and sold by the Portfolio, when such
purchases and sales are to be made, and arranging for such purchases and sales,
all in accordance with the provisions of the 1940 Act, as amended (the
"Investment Company Act") and any rules thereunder, the governing documents of
the Trust, the fundamental policies of the Trust and Portfolio, as reflected in
its registration statement, and any policies and determinations of the Board of
Trustees of the Trust.
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As compensation for its services to the Managed Portfolio under the New
Portfolio Manager's Agreement, the Portfolio Manager will be entitled to receive
from Enterprise Capital fees as for services to the Managed Portfolio calculated
at the following annual rates based upon average daily net assets: .40% for the
first $1 billion under management: 0.30% for assets from $1 billion to $2
billion; and 0.25% thereafter. The New Portfolio Manager's Agreement will
continue in effect for two years from its effective date, and will continue in
effect thereafter for successive annual periods, provided its continuance is
specifically approved at least annually by (1) a majority vote, cast in person
at a meeting called for that purpose, of the Trust's Board of Trustees or (2) a
vote of the holders of a majority (as defined in the Investment Company Act and
the rules thereunder) of the outstanding voting securities of the Portfolio, and
(3) in either event by a majority of the Trustees who are not parties to the New
Portfolio Manager's Agreement or interested persons of the Trust or of any such
party. The New Portfolio Manager's Agreement provides that it may be terminated
at any time, without penalty, by either party or by the Trust upon 60 days
written notice, provided that such termination by the Portfolio shall be
directed or approved by a vote of the Trustees of the Trust, or by a vote of
holders of a majority of the shares of the Portfolio.
The overall management fee of the Managed Portfolio paid to Enterprise
Capital is 0.80% of the average daily net assets up to $400 million; 0.75% of
average daily net assets from $400 million to $800 million; and 0.70% of average
daily net assets in excess of $800 million. Fees paid to Enterprise Capital for
management services for the Managed Portfolio during 1996 were $11,086,850.
Under the terms of the new Portfolio Manager's Agreement, Enterprise Capital
would be entitled to retain an additional 0.05% of the management fee for assets
under management in the Managed Portfolio.
The New Portfolio Manager's Agreement would take effect upon the
consummation of the transaction described below.
INFORMATION ABOUT OPCAP ADVISORS
OpCap Advisors is a majority-owned subsidiary of Oppenheimer Capital, a
registered investment adviser with approximately $50.6 billion in assets under
management on January 31, 1997. Oppenheimer Financial Corp. ("Opfin"), a holding
company, is a 1.0% general partner of OpCap Advisors. Opfin also holds a one-
third managing general partner interest in Oppenheimer Capital, and Oppenheimer
Capital, L.P., a Delaware limited partnership whose units are traded on the New
York Stock Exchange and of which Opfin is the sole 1.0% general partner, owns
the remaining two-thirds interest.
On February 13, 1997, PIMCO Advisors L.P. ("PIMCO Advisors"), a registered
investment adviser with approximately $110 billion in assets under management
through various subsidiaries, signed an Agreement and Plan of Merger with
Oppenheimer Group, Inc. ("OGI") and its subsidiary Opfin pursuant to which PIMCO
Advisors and its affiliate, Thomson Advisory Group Inc. ("TAG"), will acquire
the one-third managing general partner interest in Oppenheimer Capital, its 1.0%
general partnership interest in OpCap Advisors, and its 1.0% general partner
interest in Oppenheimer Capital L.P. (the "Transaction") and OGI will be merged
with and into TAG. The aggregate purchase price is approximately $265 million in
convertible preferred stock of TAG and assumption of certain indebtedness. The
amount of TAG preferred stock comprising the purchase price is subject to
reduction in certain circumstances. The Transaction is subject to certain
conditions being satisfied prior to closing, including consents from certain
lenders, approvals from regulatory authorities, including a favorable tax ruling
from the Internal Revenue Service, and consents of certain clients, which are
expected to take up to six months to obtain. If the Transaction is consummated,
it will involve a change in control of Oppenheimer Capital and its subsidiary
OpCap Advisors.
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The principal business address of OpCap Advisors, Oppenheimer Capital and
their affiliates is Oppenheimer Tower, 200 Liberty Street, One World Financial
Center, New York, New York 10281. The principal business address of OpCap
Advisors would not change following the Transaction. Joseph La Motta is Chairman
of Oppenheimer Capital and OpCap Advisors. George Long is President of
Oppenheimer Capital and Bernard H. Garil is President of OpCap Advisors.
Effects of the Transaction. Upon consummation of the Transaction,
Oppenheimer Capital and OpCap Advisors will be controlled by PIMCO Advisors.
PIMCO Advisors has advised OGI that it anticipates that the senior portfolio
management team of Oppenheimer Capital will continue in their present
capacities; that the eligibility of OpCap Advisors to serve as an investment
adviser or Portfolio Manager will not be affected by the Transaction; and that
Oppenheimer Capital and OpCap Advisors will be able to continue to provide
advisory and management services with no material changes in operating
conditions. PIMCO has further advised OGI that it currently anticipates that the
Transaction will not affect the ability of Oppenheimer Capital and OpCap
Advisors to fulfill their obligations under their investment advisory or
subadvisory agreements.
Information Concerning PIMCO. PIMCO Advisors, with approximately $110
billion in assets under management as of December 31, 1996, is one of the
largest publicly traded money management firms in the United States. PIMCO
Advisors' address is 800 Newport Center Drive, Suite 100, Newport Beach,
California 92660.
PIMCO Partners, G.P. ("PIMCO GP") owns approximately 42.83% and 66.37%,
respectively (and will at the closing of the Transaction own a majority of the
voting stock of TAG which owns approximately 14.94% and 25.06%, respectively),
of the total outstanding Class A and Class B units of limited partner interest
("Units") of PIMCO Advisors and is PIMCO Advisors' sole general partner. PIMCO
GP is a California general partnership with two general partners. The first of
these is an indirect wholly-owned subsidiary of Pacific Mutual Life Insurance
Company ("Pacific Mutual").
PIMCO Partners L.L.C. ("PPLLC"), a California limited liability company, is
the second, and managing, general partner of PIMCO GP. PPLLC's members are the
Managing Directors (the "PIMCO Managers") of Pacific Investment Management
Company, a subsidiary of PIMCO Advisors (the "PIMCO Subpartnership"). The PIMCO
Managers are: William H. Gross, Dean S. Meiling, James F. Muzzy, William F.
Podlich, III, Frank D. Rabinovitch, Brent R. Harris, John L. Hague, William S.
Thompson Jr., William C. Powers, David H. Edington, Benjamin Trosky, William R.
Benz, II and Lee R. Thomas, III.
PIMCO Advisors is governed by an Operating Board and an Equity Board.
Governance matters are allocated generally to the Operating Board and the
Operating Board delegates to the Operating Committee the authority to manage
day-to-day operations of PIMCO Advisors. The Operating Board is composed of
twelve members, including the chief executive officer of the PIMCO
Subpartnership as Chairman and six PIMCO Managers designated by the PIMCO
Subpartnership.
The authority of PIMCO Advisors' Operating Board and Operating Committee to
take certain specified actions is subject to the approval of PIMCO Advisors'
Equity Board. Equity Board approval is required for certain major transactions
(e.g., issuance of additional PIMCO Advisors' Units and appointment of PIMCO
Advisors' chief executive officer). In addition, the Equity Board has
jurisdiction over matters such as actions which would have a material effect
upon PIMCO Advisors' business taken as a whole and (after an appeal from an
Operating Board decision) matters likely to have a material adverse economic
effect on any subpartnership of PIMCO Advisors. The Equity Board is composed of
twelve members, including the chief
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executive officer of PIMCO Advisors, three members designated by a subsidiary of
Pacific Mutual, the chairman of the Operating Board and two members designated
by PPLLC.
Because of its power to appoint (directly or indirectly) seven of the
twelve members of the Operating Board as described above, the PIMCO
Subpartnership may be deemed to control PIMCO Advisors. Because of the direct or
indirect power to appoint 25% of the members of the Equity Board, (i) Pacific
Mutual and (ii) the PIMCO Managers and/or the PIMCO Subpartnership may each be
deemed, under applicable provisions of the Investment Company Act, to control
PIMCO Advisors. Pacific Mutual, PIMCO Subpartnership and the PIMCO Managers
disclaim such control.
PIMCO Advisors, OpCap Advisors, OGI and Oppenheimer Capital have agreed to
comply and use all commercially reasonable efforts to cause compliance with the
provisions of Section 15(f) of the Investment Company Act. Section 15(f)
provides, in pertinent part, that an investment adviser and its affiliates may
receive any amount or benefit in connection with a sale of an interest in such
investment adviser which results in an assignment of an investment advisory
contract if (1) for a period of three years after the time of such event, 75% of
the members of the Board of Trustees or Directors of the investment company
which it advises are not "interested persons" (as defined in the Investment
Company Act) of the new or old investment adviser, and (2) during the two-year
period after the date on which the transaction occurs, there is no "unfair
burden" imposed on the investment company as a result of the transaction. For
this purpose, "unfair burden" is defined to include any arrangement during the
two-year period after the transaction whereby the investment adviser or
predecessor or successor investment advisers, or any interested person of any
such adviser, receives or is entitled to receive any compensation directly or
indirectly (i) from any person in connection with the purchase or sale of
securities or other property to, from, or on behalf of the investment company
other than bona fide ordinary compensation as principal underwriter for such
company, or (ii) from the investment company or its security holders for other
than bona fide investment advisory or other services. No compensation
arrangements of the types described above are contemplated in the Transaction.
[The composition of the Board of Trustees is presently in compliance with the
75% requirement and will continue to be so if the Transaction is consummated.]
Set forth below are the names, ages and principal occupations of the chief
executive officers of OpCap Advisors and Oppenheimer Capital.
BERNARD H. GARIL (56)
President and Chief Operating Officer of OpCap Advisors; Vice President of
OCC Cash Reserves, Inc. and OCC Value Accumulation Trust, open-end investment
companies; formerly Senior Vice President of Oppenheimer & Co., Inc., 1981-1990.
JOSEPH M. LAMOTTA (64)
Chairman and Chief Executive Officer of OpCap Advisors; Chairman,
Oppenheimer Capital; Chairman and President, OCC Cash Reserves and OCC Value
Accumulation Trust, open-end investment companies, and Chairman of the Saratoga
Advantage Trust, an open-end investment company.
OpCap Advisors and Oppenheimer Capital are located at Oppenheimer Tower,
World Financial Center, New York, New York, 10281, and all its executive
officers have business addresses at that location.
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Exhibit B to this Proxy Statement sets forth a list of the investment
companies for which OpCap Advisors acts as investment adviser, the size of such
investment companies and the compensation OpCap Advisors receives for such
services.
AFFILIATED BROKERS
For the fiscal year ended December 31, 1996, Oppenheimer and Co., Inc., an
affiliate of OpCap Advisors, was paid a total of $88,056 in brokerage
commissions by the Equity Portfolio, $394,204 in brokerage commissions by the
Managed Portfolio which amounts were 42.85% and 39.73%, respectively of each
Portfolio's total brokerage commissions paid during the period.
VOTE REQUIRED
Approval of Proposal 4 with respect to any Portfolio requires the
affirmative vote of "a majority of the outstanding voting securities" of that
Portfolio, which for this purpose means the affirmative vote of the lesser of
(i) more than 50% of the outstanding shares of each of the Portfolios or (ii)
67% or more of the shares of the Portfolio present at the Meeting if more than
50% of the outstanding shares of the Portfolio are represented at the meeting in
person or by proxy.
If Proposal 4 is not approved, the existing Portfolio Manager's Agreement
will remain in effect and the Board will consider alternative actions.
THE BOARD OF TRUSTEES RECOMMENDS CONTRACTHOLDERS VOTE "FOR" PROPOSAL NO. 4.
RECEIPT OF CONTRACTHOLDER PROPOSALS
Notwithstanding the approval or disapproval of the proposals described
above, as in the past, the Trustees do not intend to hold regular annual
meetings of Contractholders of the Trust. If a Contractholder wishes to present
a proposal to be included in the proxy statement for the next meeting of
Contractholders of a Portfolio, such proposal must be received by the Trust a
reasonable time before the solicitation is to be made. The Trustees will call
meetings of Contractholders of a Portfolio as may be required under the
Investment Company Act (such as to approve a new Investment Advisory Agreement
for a Portfolio or to remove Trustees) or as they may determine in their
discretion.
MAILING OF ANNUAL REPORT
The Trust will furnish, without charge, a copy of its Annual Report for the
year ended December 31, 1996 to Contractholders upon request. Such requests
should be made to Catherine R. McClellan, Enterprise Capital, Atlanta Financial
Center, 3343 Peachtree Road, Suite 450, Atlanta, GA, 30326 or by calling 800-
432-4320. The report will be sent by first class mail within three business days
of the request.
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OTHER BUSINESS
The management knows of no business other than the matters specified above
which will be presented at the Meeting. Inasmuch as matters not known at the
time of the solicitation may come before the Meeting, the enclosed voting
instruction form confers discretionary authority with respect to such matters as
may properly come before the Meeting. It is the intention of MONY and MONY
America to vote in accordance with their judgment on such matters.
BY ORDER OF THE BOARD OF TRUSTEES
CATHERINE R. MC CLELLAN
Secretary
Date: March 29, 1997
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EXHIBIT A
EQUITY AND MANAGED PORTFOLIOS
OF
ENTERPRISE ACCUMULATION TRUST
PORTFOLIO MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of May, 1997 is among Enterprise
Accumulation Trust (the "Fund"), a Massachusetts business trust, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and OpCap Advisors, a Delaware general partnership (hereinafter
referred to as the "Portfolio Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement dated as
of September 9, 1994 with the Fund, a copy of which agreement is attached hereto
as Exhibit A (the "Investment Adviser's Agreement"). Pursuant to the Investment
Adviser's Agreement, the Adviser has agreed to render investment advisory and
certain other management services to all of the Portfolios of the Fund, and the
Fund has agreed to employ the Adviser to render such services and to pay to the
Adviser certain fees therefore. The Investment Adviser's Agreement recognizes
that the Adviser may enter into agreements with other investment advisers who
will serve as Portfolio Managers to the Portfolios of the Fund.
(B) The parties hereto wish to enter into an agreement whereby the
Portfolio Manager will provide to the Equity and Managed Portfolios of the Fund
(the "Portfolios") securities investment advisory services for those Portfolios.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Portfolio Manager agree as follows:
(1) The Fund and Adviser hereby employs the Portfolio Manager to
render certain investment advisory services to the Portfolios, as set forth
herein. The Portfolio Manager hereby accepts such employment and agrees to
perform such services on the terms herein set forth, and for the
compensation herein provided.
(2) The Portfolio Manager shall furnish the Portfolios advice with
respect to the investment and reinvestment of the assets of the Portfolios,
or such portion of the assets of the Portfolios as the Adviser shall
specify from time to time, in accordance with the investment objectives,
restrictions and limitations of the Portfolios as set forth in the Fund's
most recent Registration Statement.
(3) The Portfolio Manager shall perform a monthly reconciliation of
the Portfolios to the holdings report provided by the Fund's custodian and
bring any material or significant variances regarding holding or valuation
to the attention of the Adviser.
(4) The Portfolio Manager shall for all purposes herein be deemed to
be an independent contractor. The Portfolio Manager has no authority to act
for or represent the Fund or the Portfolios in any way
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except to direct securities transactions pursuant to its investment advice
hereunder. The Portfolio Manager is not an agent of the Fund or the
Portfolios.
(5) It is understood that the Portfolio Manager does not, by this
Agreement, undertake to assume or pay any costs or expenses of the Fund or
the Portfolios.
(6)(a) The Adviser agrees to pay the Portfolio Manager for its
services to be furnished under this Agreement, with respect to each
calendar month after the effective date of this Agreement, on the twentieth
(20th) day after the close of each calendar month, a sum equal to 0.03333
of 1% of the average of the daily closing net asset value of the Portfolios
managed by the Portfolio Manager during such month (that is, .40 of 1% per
year) for assets under management up to $1,000,000,000 (one billion
dollars) per Portfolio; a sum equal to 0.025 of 1% of the average of the
daily closing net asset values of the Portfolios during such month (that
is, .30 of 1% per year) for assets under management in excess of
$1,000,000,000 (one billion dollars) per Portfolio; and as to the Managed
Portfolio, a sum equal to 0.2083% of the average daily closing net asset
value of the Portfolio during such month (that is .25 of 1% per year) for
assets under management in excess of $2,000,000,000 (two billion dollars).
(6)(b) The payment of all fees provided for hereunder shall be
prorated and reduced for sums payable for a period less than a full month
in the event of termination of this Agreement on a day that is not the end
of a calendar month.
(6)(c) For the purposes of this Paragraph 6, the daily closing net
asset values of the Portfolios shall be computed in the manner specified in
the Registration Statement for the computation of the value of such net
assets in connection with the determination of the net asset value of the
Portfolios' shares.
(7) The services of the Portfolio Manager hereunder are not to be
deemed to be exclusive, and the Portfolio Manager is free to render
services to others and to engage in other activities so long as its
services hereunder are not impaired thereby. Without in any way relieving
the Portfolio Manager of its responsibilities hereunder, it is agreed that
the Portfolio Manager may employ others to furnish factual information,
economic advice and/or research, and investment recommendations, upon which
its investment advice and service is furnished hereunder.
(8) In the absence of willful misfeasance, bad faith or gross
negligence in the performance of its duties hereunder, or reckless
disregard of its obligations and duties hereunder, the Portfolio Manager
shall not be liable to the Fund, the Portfolios or the Adviser or to any
shareholder or shareholders of the Fund, the Portfolios or the Adviser for
any mistake of judgment, act or omission in the course of, or connected
with, the services to be rendered by the Portfolio Manager hereunder.
(9) The Portfolio Manager will take necessary steps to prevent the
investment professionals of the Portfolio Manager who are responsible for
investing assets of the Portfolios from taking, at any time, a short
position in any shares of any holdings of any Portfolios of the Fund for
any accounts in which such individuals have a beneficial interest,
excluding short positions, including without limitation, short
against-the-box positions, effected for tax reasons. The Portfolio Manager
also will cooperate with the Fund in adopting a written policy prohibiting
insider trading with respect to Fund Portfolio transactions insofar as such
transactions may relate to the Portfolio Manager.
(10) In connection with the management of the investment and
reinvestment of the assets of the Portfolio, the Portfolio Manager is
authorized to select the brokers or dealers including Oppenheimer & Co.,
Inc., ("Opco") that will execute purchase and sale transactions for the
Portfolios, and is directed to use its best efforts to obtain the best
available price and most favorable execution with respect to such
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purchases and sales of Portfolio securities for the Fund. Subject to this
primary requirement, and maintaining as its first consideration the
benefits for the Portfolios and its shareholders, the Portfolio Manager
shall have the right, subject to the approval of the Board of Trustees of
the Fund and of the Adviser, to follow a policy of selecting brokers and
dealers who furnish statistical research and other services to the
Portfolios, the Adviser, or the Portfolio Manager and, subject to the Rules
of Fair Practice of the National Association of Securities Dealers, Inc.,
to select brokers and dealers who sell shares of Portfolios of the Fund.
The Adviser and the Fund's Portfolios recognize and intend that
subject to the foregoing provisions of this Section, Opco will act as its
regular broker so long as it is lawful for it so to act and that Opco may
be a major recipient of brokerage commissions paid by the Fund's
Portfolios. Opco may effect securities transactions for the Fund's
Portfolios only if (1) the commissions, fees or other remuneration received
or to be received by it are reasonable and fair compared to the
commissions, fees or other remuneration received by other brokers in
connection with comparable transactions involving similar securities being
purchased or sold on a securities exchange during a comparable period of
time and (2) the Trustees, including a majority of those Trustees who are
not interested persons, have adopted procedures pursuant to Rule 17e-1
under the Investment Company Act of 1940 for determining the permissible
level of such commissions. The Fund's Portfolios will not purchase any
securities from or sell any securities to Opco acting as principal for
their own account.
(11) The Fund may terminate this Agreement by sixty days written
notice to the Adviser and the Portfolio Manager at any time, without the
payment of any penalty, by vote of the Fund's Board of Trustees, or by vote
of a majority of its outstanding voting securities. The Adviser may
terminate this Agreement by sixty days written notice to the Portfolio
Manager and the Portfolio Manager may terminate this Agreement by sixty
days written notice to the Adviser, without the payment of any penalty.
This Agreement shall immediately terminate in the event of its assignment,
unless an order is issued by the Securities and Exchange Commission
conditionally or unconditionally exempting such assignment from the
provision of Section 15 (a) of the Investment Company Act of 1940, in which
event this Agreement shall remain in full force and effect.
(12) Subject to prior termination as provided above, this Agreement
shall continue in force from the date of execution until May 1, 1997 and
from year to year thereafter if its continuance after said date: (1) is
specifically approved on or before said date and at least annually
thereafter by vote of the Board of Trustees of the Fund, including a
majority of those trustees who are not parties to this Agreement of
interested persons of any such party, or by vote of a majority of the
outstanding voting securities of the Fund, and (2) is specifically approved
at least annually by the vote of a majority of trustees of the Fund 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.
(13) The Adviser shall indemnify and hold harmless the Portfolio
Manager, its officers and directors and each person, if any, who controls
the Portfolio Manager within the meaning of Section 15 of the Securities
Act of 1933 (any and all such persons shall be referred to as "Indemnified
Party"), against any loss, liability, claim, damage or expense (including
the reasonable cost of investigating or defending any alleged loss,
liability, claim, damages or expense and reasonable counsel fees incurred
in connection therewith), arising by reason of any matter to which this
Portfolio Manager's Agreement relates. However, in no case (i) is this
indemnity to be deemed to protect any particular Indemnified Party against
any liability to which such Indemnified Party would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of reckless
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disregard of its obligations and duties under this Portfolio Manager's
Agreement or (ii) is the Adviser to be liable under this indemnity with
respect to any claim made against any particular Indemnified Party unless
such Indemnified Party shall have notified the Adviser in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Portfolio Manager or such controlling persons.
The Portfolio Manager shall indemnify and hold harmless the Adviser
and each of its directors and officers and each person if any who controls
the Adviser within the meaning of Section 15 of the Securities Act of 1933,
against any loss, liability, claim, damage or expense described in the
foregoing indemnity, but only with respect to the Portfolio Manager's
willful misfeasance, bad faith or gross negligence in the performance of
its duties under this Portfolio Manager's Agreement. In case any action
shall be brought against the Adviser or any person so indemnified, in
respect of which indemnity may be sought against the Portfolio Manager, the
Portfolio Manager shall have the rights and duties given to the Adviser,
and the Adviser and each person so indemnified shall have the rights and
duties given to the Portfolio Manager by the provisions of subsection (i)
and (ii) of this section.
(14) Except as otherwise provided in paragraph 13 hereof and as may be
required under applicable federal law, this Portfolio Manager's Agreement
shall be governed by the laws of the State of New York.
(15) The Portfolio Manager agrees to notify the parties within a
reasonable period of time regarding a material change in the membership of
the Portfolio Manager.
(16) The terms "vote of a majority of the outstanding voting
securities," "assignment" and "interested persons," when used herein, shall
have the respective meanings specified in the Investment Company Act of
1940 as now in effect or as hereafter amended.
(17) This Agreement is executed by the Trustees of the Fund, not
individually, but rather in their capacity as Trustees under the
Declaration of Trust made March 2, 1988. None of the Shareholders,
Trustees, officers, employees, or agents of the Fund shall be personally
bound or liable under this Agreement, nor shall resort be had to their
private property for the satisfaction of any obligation or claim hereunder
but only to the property of the Fund and, if the obligation or claim
relates to the property held by the Fund for the benefit of one or more but
fewer than all Portfolios, then only to the property held for the benefit
of the affected Portfolio.
A-4
<PAGE> 23
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their duly authorized officers and their corporate seals hereunder duly affixed
and attested, as of the date first above written.
<TABLE>
<S> <C>
(SEAL) ENTERPRISE CAPITAL
MANAGEMENT, INC.
By: ----------------------------------------------
ATTEST ---------------------------------------
Secretary
(SEAL) OPCAP ADVISORS
By: ----------------------------------------------
ATTEST ---------------------------------------
Secretary
(SEAL) ENTERPRISE ACCUMULATION TRUST
By: ----------------------------------------------
ATTEST ---------------------------------------
Secretary
</TABLE>
A-5
<PAGE> 24
EXHIBIT B
The registered investment companies listed below are managed by OpCap
Advisors and have similar investment objectives to at least one of the
Portfolios:
<TABLE>
<CAPTION>
APPROXIMATE NET
ASSETS
FUND (AS OF 3/5/97) ADVISORY FEE RATE
- ---- --------------- -----------------
<S> <C> <C>
Oppenheimer Quest Value Fund, Inc.(1) $ 727,037,375 1.0% on the first $400 million;
.90% on the next $400 million;
.85% of net assets in excess of $800
million
Oppenheimer Quest
Opportunity Value Fund(1) $2,588,190,004 1.0% on the first $400 million;
.90% on the next $400 million;
.85% of net assets in excess of $800
million
Oppenheimer Quest Officers Value
Fund(1)(2) $ 9,629,594 1.0% of its daily net assets
Oppenheimer Quest Capital Value Fund,
Inc. $ 517,386,883 (3)
Enterprise Accumulation Trust:
Equity Portfolio $ 351,881,504 .40% on the first $1 billion;(4)
.30% on assets over $1 billion;
Managed Portfolio $2,119,223,394 .40% on the first $1 billion;(4)
.30% on assets over $1 billion
Enterprise Group of Funds Managed
Portfolio $ 249,381,713 .40% on the first $100 million;(5)
.30% on assets in excess of $100
million
Penn Series Funds, Inc.:
Value Equity Fund $ 202,900,000 .50%(6)
Endeavor Series Trust:
Value Equity Portfolio $ 128,700,000 .40%(7)
Opportunity Value Portfolio $ 3,824,007 .40%(6)
OCC Accumulation Trust:
Equity Portfolio $ 21,579,021 .80% on the first $400 million;
.75% on the next $400 million;
.70% of net assets in excess of $800
million
Managed Portfolio $ 210,594,170 .80% on the first $400 million;
.75% on the next $400 million;
.70% of net assets in excess of $800
million
WNL Series Trust:
Elite Value Asset Allocation
Portfolio $ 2,776,727 .40%(8)
The Saratoga Advantage Trust:
Large Capitalization Value Portfolio $ 25,297,008 .30%(8)
</TABLE>
- ---------------
(1) With respect to each of these funds, Oppenheimer Funds, Inc. ("OFI") is the
investment adviser and OpCap Advisors is the sub-adviser. OFI pays OpCap
Advisors monthly an annual fee based on the average daily net assets of the
fund equal to 40% of the advisory fee collected by OFI based on the total
net assets of the fund as of November 22, 1995 (the "base amount") plus 30%
of the investment advisory fee collected by OFI based on the total net
assets of the fund that exceed the base amount.
B-1
<PAGE> 25
(2) OFI's advisory fee for the Oppenheimer Quest Officers Value Fund is 1.00%.
However, effective August 1, 1996, OFI is waiving the portion of its
management fee equal to what OFI would have been required to pay OpCap as
the sub-advisory fee and OpCap has agreed to waive its sub-advisory fee.
(3) Effective February 28, 1997, OFI became the manager of the fund and will be
paid a fee at the rate of 1.00% of the first $400 million of assets, .90% of
the next $400 million of net assets and .85% of assets over $800 million.
OFI will pay OpCap a sub-advisory fee equal to 40% of the net advisory fee
calculated by OFI for the fund based on the total net assets of the fund as
of February 28, 1997 and remaining 120 days later (the "base amount") plus
30% of the investment advisory fee collected by OFI based on the total net
assets that exceed the base amount.
(4) These fees are for investment advisory services only. Management services
are provided to the portfolios by a third party, not OpCap Advisors. The
Manager, who pays the investment advisory fee to OpCap Advisors, receives a
management fee, on an annual basis, of 0.80% of the first $400 million of
average daily net assets; .75% on the next $400 million and .70% on assets
above $800 million of each of the portfolios.
(5) This fee is for investment advisory services only. Management services are
provided to the Portfolio by a party other than OpCap Advisors. The Manager,
who pays the investment advisory fee to OpCap Advisors, receives a
Management Fee of 0.75% of the average daily net assets of the Portfolio.
(6) These fees are for investment advisory services only. Administrative
services are provided to these funds by a third party, not OpCap Advisors.
The funds are each charged on an annual basis a fee for administrative
services of 0.15% of their respective average daily net assets.
(7) This fee is for investment advisory services only. Management services are
provided to the Portfolio by a party other than OpCap Advisors. The Manager,
who pays the investment advisory fee to OpCap Advisors, receives a
Management Fee of .80% of the average daily net assets of the Portfolio.
(8) This fee is for investment advisory services only. Management services are
provided to the portfolio by a party other than OpCap Advisors. The Manager,
who pays the investment advisory fee to OpCap Advisors, receives a
Management Fee of 0.65% of the average daily net assets of the Portfolio.
B-2
<PAGE> 26
APPENDIX
ENTERPRISE ACCUMULATION TRUST
PROXY FOR CONTRACTHOLDER MEETING APRIL 28, 1997
The undersigned does hereby appoints Victor Ugolyn, Catherine R. McClellan or
Herbert M. Williamson, and each of them as proxies of the undersigned, each will
power to appoint his substitute, for the Special Meeting of Contractholders of
Enterprise Accumulation Trust (the "Trust") to be held on April 28, 1997, at the
offices of Enterprise Capital Management, Atlanta Financial Center, 3343
Peachtree Road, NE, Suite 450, Atlanta, Georgia 30326 at 2:00 p.m., and at any
adjournment thereof (the "Meeting") to vote, as designated below, all shares of
the Trust, held by the undersigned at the close of business on March 12, 1997.
Capitalized terms used without definition have the meanings given to them in the
accompanying Proxy Statement.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR ALL OF THE PROPOSALS LISTED BELOW
AND ON THE REVERSE SIDE HEREOF. THE SHARES REPRESENTED HEREBY WILL BE VOTED A
INDICATED OR FOR IF NO CHOICE IS INDICATED. THE PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF TRUSTEES.
1. APPROVAL OF CHANGE IN THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WHEREBY
NO, PORTFOLIO WILL, AS TO 75% OF THE ASSETS OF EACH PORTFOLIO, INVEST MORE
THAN 5% OF THE VALUE OF ITS TOTAL ASSETS IN THE SECURITIES OF ANY SINGLE
ISSUER OTHER THAN CASH ITEMS AND U.S. GOVERNMENT SECURITIES, AS DEFINED IN
THE INVESTMENT COMPANY ACT OF 1940).
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
Portfolio [ ] [ ] [ ]
------------------------------------------------------------
</TABLE>
2. APPROVAL OF PROPOSED TO PERMIT ENTERPRISE CAPITAL MANAGEMENT, INC. TO ENTER
INTO NEW OR AMENDED CONTRACTS WITH PORTFOLIO MANAGERS WITHOUT OBTAINING
CONTRACTHOLDER APPROVAL.
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
Portfolio [ ] [ ] [ ]
------------------------------------------------------------
</TABLE>
(Continued on other side)
(Continued from other side)
3. APPROVAL OF PORTFOLIO MANAGER'S AGREEMENT BETWEEN THE ADVISER, TRUST AND
OPCAP ADVISORS WITH A MANAGEMENT FEE REDUCED AS TO THE MANAGED PORTFOLIO.
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
Portfolio [ ] [ ] [ ]
------------------------------------------------------------
</TABLE>
4. APPROVAL OF PORTFOLIO MANAGER'S AGREEMENT BETWEEN THE ADVISER, TRUST AND
OPCAP ADVISORS TO BECOME EFFECTIVE UPON THE CONSUMMATION OF A TRANSACTION
INVOLVING OPCAP'S PARENT, OPPENHEIMER CAPITAL, AND PIMCO.
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
Portfolio [ ] [ ] [ ]
------------------------------------------------------------
</TABLE>
5. TO ACT UPON SUCH OTHER MATTERS AS PROPERLY MAY COME BEFORE THE MEETING OR ANY
ADJOURNMENT OR ADJOURNMENTS THEREOF.
DATED:
-------------------------------------------------------------------------- ,
1996
(Month, Day)
------------------------------
Signature(s)
------------------------------
Signature(s)
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc.,
please give your full title as such. Joint owners should each sign this
Voting Instruction Form.
