1933 Act File No. 33-31072
1940 Act File No. 811-5876
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. ____ [ ]
Post-Effective Amendment No. 12 [X]
And
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 12 [X]
LORD ABBETT SERIES FUND, INC.
------------------------------------------------
Exact Name of Registrant as Specified in Charter
767 Fifth Avenue, New York, NY 10153-0203
-----------------------------------------
Address of Principal Executive Office
Registrant's Telephone Number (212) 848-1800
--------------------------------------------
Thomas F. Konop, Vice President
767 Fifth Avenue, New York, NY 10153-0203
-----------------------------------------
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
___ immediately upon filing pursuant to paragraph (b)
X on May 1, 1998 pursuant to paragraph (b) of rule 485
___ 60 days after filing pursuant to paragraph (a)(1)
___ on (date) pursuant to paragraph (a)(1)
___ 75 days after filing pursuant to paragraph (a)(2)
___ on (date) pursuant to paragraph (a)(2) of rule 485.
If appropriate, check the following box:
___ this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
LORD ABBETT SERIES FUND, INC.
FORM N-1A
Cross Reference Sheet
Pursuant to Rule 481(a)
EXPLANATORY NOTE
This Post-Effective Amendment No. 12 (the "Amendment") to the Registration
Statement relates only to the Variable Contract Class of the Growth and Income
Portfolio of Lord Abbett Series Fund, Inc. This Amendment supersedes all
previously filed Registration Statements, including that filed under
Post-Effective Amendment No. 12.
Form N-1A Location In Prospectus or
Item No. Statement of Additional Information
- --------- -----------------------------------
1 Cover Page
2 N/A
3 Financial Highlights; Performance
4 (a) (i) Cover Page; The Fund
4 (a) (ii) Investment Objectives and Policies
4 (b) (c) Investment Objectives and Policies; Risk Factors
5 (a) (b) The Fund; Management
5 (c) N/A
5 (d) Fund's Custodian, Transfer Agent, Auditors and Counsel
5 (e) Management
5 (f) (i) N/A
5 (f) (ii) Purchase and Redemption of Shares; Portfolio Transactions
6 (a) Cover Page; Shareholder Rights
6 (b) Management
6 (c) (d) N/A
6 (e) Cover Page
6 (f) (g) Dividends and Distributions; Tax Status
7 (a) The Fund
7 (b) (c) (d) Purchase and Redemption of Shares; Net Asset Value
7 (e) (f) N/A
8 (a) (b) (c) (d) The Fund; Purchase and Redemption of Shares
9 N/A
10 Cover Page
11 Cover Page - Table of Contents
12 N/A
13 (a) (b) (c) Investment Objectives and Policies
13 (d) Portfolio Turnover Rates - Prospectus
14 Directors and Officers
15 (a) (b) (c) Directors and Officers; Investment Advisory and Other
Services
16 (a) (i) Investment Advisory and Other Services
<PAGE>
Form N-1A Location In Prospectus or
Item No. Statement of Additional Information
- --------- -----------------------------------
16 (a) (ii) Directors and Officers
16 (a) (iii) Investment Advisory and Other Services
16 (b) (e) Investment Advisory and Other Services
16 (c) (d) (f) (g) N/A
16 (h) Investment Advisory and Other Services
16 (i) N/A
17 (a) Portfolio Transactions
17 (b) N/A
17 (c) Portfolio Transactions
17 (d) (e) N/A
18 (a) The Fund - Prospectus
18 (b) N/A
19 (a) (b) The Fund - Prospectus; Purchase and Redemption of
Shares - Prospectus
19 (c) N/A
20 Taxes; Tax Status - Prospectus
21 (a) The Fund - Prospectus
21 (b) (c) N/A
22 N/A
23 FinancialStatement
<PAGE>
PART C OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
The financial statements of the Fund for the fiscal year ended December
31, 1997 are included in the 1997 Annual Report to Shareholders and are
incorporated by reference in Part B hereof.
(b) Exhibits -
(1) Restated Articles of Incorporation *
(2) By-Laws of Registrant*
(3) Not Applicable
(4) Not Applicable
(5) Management Agreement between Registrant and
Lord, Abbett & Co.****
(i) Sub-Investment Management Agreement#
(6) Form of Distribution Plan between Registrant and
Lord, Abbett & Co.**
(7) Not Applicable
(8) (i) Custody Agreement between Registrant and
Morgan Guaranty Trust Company of New York#
(ii) Form of Transfer Agency Agreement***
(9) Fund Participation Agreement between Lord Abbett & Co. and
Great American Reserve Insurance Company*
(10) Opinion and Consent of Counsel***
(11) Consent of Independent Auditors*
(12) Not Applicable
(13) Form of Agreements Governing Contribution of Capital***
(14) Not Applicable
(15) Form of Distribution Agreement between Registrant and Lord,
Abbett & Co.**
(16) Not applicable
(18) Form of Plan entered into by Registrant pursuant to Rule
18(f)3.*****
Ex. 27 Financial Data Schedule*
* Filed herewith
** Incorporated by reference to Registrant's initial registration on Form
N-1A, filed on September 15, 1989.
*** Incorporated by reference to Registrant's Pre-Effective Amendment No.
1, filed on November 17, 1989.
**** Incorporated by reference to Registrant's Post-Effective Amendment No.
1, filed on April 2, 1990.
***** Incorporated by reference to Post-Effective Amendment No. 12 to the
Registration Statement on Form N-1A of Lord Abbett Investment Trust
(File No. 811-7988).
# Incorporated by reference to Registrant's Post-Effective Amendment No.
2, filed on April 22, 1991.
## Incorporated by reference to Registrant's Post-Effective Amendment No.
6, filed on April 28, 1994.
Item 25. Persons Controlled by or Under Common Control with Registrant
<PAGE>
Part C
Page 2
The shares of the Fund are currently sold to Cova Financial Services
Life Insurance Company and Great American Reserve Insurance Company,
individually ("Cova") and ("Great American"), collectively (the "Life
Companies").
Cova and Lord, Abbett & Co., (the Fund's Investment Manager) each made
initial capital contributions to the Fund and together own the majority
of the outstanding shares of the Fund.
COVA Variable Annuity Account One, a separate account of COVA Financial
Services Life Insurance Company is a Delaware corporation located at
One Tower Lane, Oakbrook Terrace, Illinois 60181.
Great American Reserve Insurance Company is a life insurance company
organized under the laws of the State of Indiana located at 11815 N.
Pennsylvania Street, Carmel, Indiana 46032-4572.
Lord, Abbett & Co. is a partnership located at The General Motors
Building, 767 Fifth Avenue, New York, New York 10153-0203. Eight of the
twelve general partners of Lord, Abbett & Co., are officers
and/or
directors of the Fund, are: Zane E. Brown; Daniel E. Carper, Paul A.
Hilstad, Robert S. Dow, W. Thomas Hudson, Robert G. Morris, E. Wayne
Nordberg and John J. Walsh.
The other partners, who are neither officers nor directors of the Fund,
are: Stephen I. Allen, Daria L.Foster and Robert J. Noelke.
Item 26. Number of Record Holders of Securities
The Life Companies and Lord, Abbett & Co. are the shareholders of the
Fund.
Item 27. Indemnification
Registrant is incorporated under the laws of the State of Maryland and
is subject to Section 2-418 of the Corporations and Associations
Article of the Annotated Code of the State of Maryland controlling the
indemnification of the directors and officers. Since Registrant has its
executive offices in the State of New York, and is qualified as a
foreign corporation doing business in such State, the persons covered
by the foregoing statute may also be entitled to and subject to the
limitations of the indemnification provisions of Section 721-726 of the
New York Business Corporation Law.
The general effect of these statutes is to protect officers, directors
and employees of Registrant against legal liability and expenses
incurred by reason of their positions with the Registrant. The statutes
provide for indemnification for liability
<PAGE>
Part C
Page 3
for proceedings not brought on behalf of the corporation and for those
brought on behalf of the corporation, and in each case place conditions
under which indemnification will be permitted, including requirements
that the officer, director or employee acted in good faith. Under
certain conditions, payment of expenses in advance of final disposition
may be permitted. The By-Laws of Registrant, without limiting the
authority of Registrant to indemnify any of its officers, employees or
agents to the extent consistent with applicable law, makes the
indemnification of its directors mandatory subject only to the
conditions and limitations imposed by the above-mentioned Section 2-418
of Maryland Law and by the provisions of Section 17(h) of the
Investment Company Act of 1940 as interpreted and required to be
implemented by SEC Release No. IC-11330 of September 4, 1980.
In referring in its By-Laws to, and making indemnification of directors
subject to the conditions and limitations of, both Section 2-418 of the
Maryland Law and Section 17(h) of the Investment Company Act of 1940,
Registrant intends that conditions and limitations on the extent of the
indemnification of directors imposed by the provisions of either
Section 2-418 or Section 17(h) shall apply and that any inconsistency
between the two will be resolved by applying the provisions of said
Section 17(h) if the condition or limitation imposed by Section 17(h)
is the more stringent. In referring in its By-Laws to SEC Release No.
IC-11330 as the source for interpretation and implementation of said
Section 17(h), Registrant understands that it would be required under
its By-Laws to use reasonable and fair means in determining whether
indemnification of a director should be made and undertakes to use
either (1) a final decision on the merits by a court or other body
before whom the proceeding was brought that the person to be
indemnified ("indemnitee") was not liable to Registrant or to its
security holders by reason of willful malfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct
of his office ("disabling conduct") or (2) in the absence of such a
decision, a reasonable determination, based upon a review of the facts,
that the indemnitee was not liable by reason of such disabling conduct,
by (a) the vote of a majority of a quorum of directors who are neither
"interested persons" (as defined in the 1940 Act) of Registrant nor
parties to the proceeding, or (b) an independent legal counsel in a
written opinion. Also, Registrant will make advances of attorneys' fees
or other expenses incurred by a director in his defense only if (in
addition to his undertaking to repay the advance if he is not
ultimately entitled to indemnification) (1) the indemnitee provides a
security for his undertaking, (2) Registrant shall be insured against
losses arising by reason of any lawful advances, or (3) a majority of a
quorum of the non-interested, non-party directors of Registrant, or an
independent legal counsel in a written opinion, shall determine, based
on a review of readily available facts, that there is reason to believe
that the indemnitee ultimately will be found entitled to
indemnification.
<PAGE>
Part C
Page 4
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expense incurred or paid
by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
In addition, Registrant maintains a directors' and officers errors and
omissions liability insurance policy protecting directors and officers
against liability for breach of duty, negligent act, error or omission
committed in their capacity as directors or officers. The policy
contains certain exclusions, among which is exclusion from coverage for
active or deliberate dishonest or fraudulent acts and exclusion for
fines or penalties imposed by law or other matters deemed uninsurable.
Item 28. Business and Other Connections of Investment Adviser
Lord, Abbett & Co. acts as investment adviser for twelve other open-end
investment companies and as investment adviser to approximately 6,220
private accounts. Other than acting as directors and/or officers of
open-end investment companies sponsored by Lord, Abbett & Co., none of
Lord, Abbett & Co.'s partners has, in the past two fiscal years,
engaged in any other business, profession, vocation or employment of a
substantial nature for his own account or in the capacity of director,
officer, employee, partner or trustee of any entity except as follows:
John J. Walsh
Trustee
Brooklyn Hospital
Parkside Avenue
Brooklyn, N.Y.
Item 29. Principal Underwriter
<PAGE>
Part C
Page 5
(a) Lord Abbett Affiliated Fund, Inc.
Lord Abbett Bond-Debenture Fund, Inc.
Lord Abbett Mid-Cap Value Fund, Inc.
Lord Abbett Developing Growth Fund, Inc.
Lord Abbett Tax-Free Income Fund, Inc.
Lord Abbett Tax-Free Income Trust
Lord Abbett Global Fund, Inc.
Lord Abbett Equity Fund
Lord Abbett U.S. Government Securities Money Market Fund, Inc.
Lord Abbett Securities Trust
Lord Abbett Investment Trust
Lord Abbett Research Fund, Inc.
Investment Advisor
American Skandia Trust
(Lord Abbett Growth and Income Portfolio)
(b) The partners of Lord, Abbett & Co. are:
Name and Principal Positions and Offices
Business Address (1) with Registrant
Robert S. Dow Chairman, President and Director
Paul A. Hilstad Vice President & Secretary
Zane E. Brown Vice President
Daniel E. Carper Vice President
W. Thomas Hudson Vice President
Michael B. McLaughlin Vice President
Robert G. Morris Vice President
E. Wayne Nordberg Vice President
John J. Walsh Vice President
The other partners who are neither officers nor directors of
the Fund are Stephen I. Allen, Daria L. Foster and Robert J.
Noelke.
(1) Each of the above has a principal business address of 767 Fifth
Avenue, New York, NY 10153-0203
(c) Not applicable
<PAGE>
Part C
Page 6
Item 30. Location of Accounts and Records
Registrant maintains the records, required by Rules 31a-1(a) and (b),
and 31a-2(a) at its main office.
Lord, Abbett & Co. maintains the records required by Rules 31a-1(f) and
31a-2(e) at its main office.
Certain records and correspondence may be physically maintained at the
main office of the Registrant's Transfer Agent, Custodian, or
Shareholder Servicing Agent within the requirements of Rule 31a-3.
Item 31. Management Services
None
Item 32. Undertakings
(c) The Registrant undertakes to furnish each person to whom a prospectus
is delivered with a copy of the Registrant's latest annual report to
shareholders, upon request and without charge.
The registrant undertakes, if requested to do so by the holders of at
least 10% of the registrant's outstanding shares, to call a meeting of
shareholders for the purpose of voting upon the question of removal of
a director or directors and to assist in communications with other
shareholders as required by Section 16(c).
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940 the Registrant certifies that it meets the
all the requirements for effectiveness of this Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and had duly caused
this Registration Statement and/or any amendment thereto to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York
and State of New York on the 30th day of April, 1998.
LORD ABBETT SERIES FUND, INC.
By: /s/ Robert S. Dow
Robert S. Dow, Chairman of the Board
and Director
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
President, Chairman of
/s/ Robert S. Dow the Board and Director April 30, 1998
- --------------------------- ---------------------------- ----------------
Robert S. Dow (Title) (Date)
Vice President and
/s/ Keith F. O'Connor Chief Financial Officer April 30, 1998
- --------------------------- ---------------------------- ----------------
Keith F. O'Connor (Title) (Date)
/s/ E. Thayer Bigelow Director April 30, 1998
- --------------------------- ---------------------------- ----------------
E. Thayer Bigelow (Title) (Date)
/s/ Stewart S. Dixon Director April 30, 1998
- --------------------------- ---------------------------- ----------------
Stewart S. Dixon (Title) (Date)
/s/ John C. Jansing Director April 30, 1998
- --------------------------- ---------------------------- ----------------
John C. Jansing (Title) (Date)
/s/ C. Alan MacDonld Director April 30, 1998
- --------------------------- ---------------------------- ----------------
C. Alan MacDonald (Title) (Date)
/s/ Hansel B. Millican, Jr. Director April 30, 1998
- --------------------------- ---------------------------- ----------------
Hansel B. Millican, Jr. (Title) (Date)
/s/ Thomas J. Neff Director April 30, 1998
- --------------------------- ---------------------------- ----------------
Thomas J. Neff (Title) (Date)
<PAGE>
LORD ABBETT SERIES FUND, INC.
The General Motors Building
767 Fifth Avenue
New York, NY 10153-0203
- --------------------------------------------------------------------------------
Lord Abbett Series Fund, Inc. (the "Fund"), is a diversified open-end management
investment company incorporated under Maryland law on August 28, 1989. The Fund
is a series fund currently comprised of one active Portfolio: the Growth and
Income Portfolio (the "Portfolio"). The Portfolio issues one separate class of
shares: the Variable Contract Class, which is offered by this Prospectus. The
Directors may provide for additional Portfolios from time to time.
This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. Additional information about
the Fund has been filed with the Securities and Exchange Commission. The
Statement of Additional Information is incorporated by reference into this
Prospectus. Both may be obtained, without charge, by writing to the Fund or by
calling 800-831-LIFE with respect to Variable Contracts of Cova Financial
Services Life Insurance Company, 800-342-6307 with respect to Variable Contracts
of Great American Reserve Insurance Company and 800-752-7215 with respect to the
variable contracts of SunLife of Canada (U.S).
Investors should read and retain this Prospectus for future reference.
Shareholder inquiries should be made in writing directly to the Fund or by
calling one of the 800 numbers mentioned above.
Shares of the Fund are not deposits or obligations of, or guaranteed or endorsed
by, any bank, and the shares are not federally insured by the Federal Deposit
Insurance Corporation, the Federal Reserve Board, or any other agency. An
investment in the Fund involves risks, including the possible loss of principal.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus and of the Statement of Additional Information is
May 1, 1998.
-1-
<PAGE>
1. FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The following financial highlights have been audited by Deloitte & Touche LLP,
independent auditors, whose report thereon is incorporated by reference into the
Statement of Additional Information and may be obtained on request. The total
return information for the Portfolio shown in the table below does not reflect
expenses of a separate account or any variable contracts. If such charges were
included, the total return figures would be lower for all periods shown. Further
information about the Portfolio's performance is contained in the Annual Report
to shareholders which may be obtained, without charge, by calling one of the 800
numbers mentioned on the previous page.
GROWTH AND INCOME PORTFOLIO
<TABLE>
<CAPTION>
For the Period
Dec. 11, 1989
(Commencement
of Operations) to
Year Ended December 31, Dec. 31, 1989
------------------------------------------------------------------------------------------
Per Share
Operating
Performance: 1997 1996 1995 1994 1993 1992 1991 1990
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset
value,
beginning of
period $17.022 $15.241 $12.71 $13.15 $12.27 $11.61 $ 9.93 $10.07 $10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from
investment
operations
Net investment
income .393** .408 .459 .41 .34 .45* .50* .41* .00*
Net realized
and unrealized
gain (loss)
on investments 3.755 2.563 3.332 (.045) 1.48 1.3575 2.18 (.19) .07
Total from
investment
operations 4.148 2.971 3.791 .365 1.82 1.8075 2.68 .22 .07
- ------------------------------------------------------------------------------------------------------------------------------------
Distributions
Dividends from
net investment
income (.34) (.36) (.36) (.33) (.27) (.32) (.35) (.29) ---
Distributions
from net
realized gain (1.32) (.83) (.90) (.475) (.67) (.8275) (.65) (.07) ---
Net asset
value, end of
period $19.510 $17.022 $15.241 $12.71 $13.15 $12.27 $11.61 $ 9.93 $10.07
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return 24.34% 19.49% 29.82% 2.76% 14.80% 15.62% 27.00% 2.18% 0.70%+
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end
of period (000) $512,438 $303,982 $193,575 $114,608 $82,219 $37,307 $18,297 $10,754 $247
Ratios to
Average Net
Assets:
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses,
including waiver .52% .52% .52% .59% .57% .51% .13% .46% .28%+
Expenses,
excluding waiver .52% .52% .52% .59% .57% .65% .72% .91% 1.73%+
Net investment
income 2.02% 2.32% 2.91% 2.97% 2.76% 3.38% 4.20% 4.38% .00%+
Portfolio
turnover rate 43.09% 48.93% 70.30% 68.94% 78.26% 107.30% 70.82% 49.06% .00%
- ------------------------------------------------------------------------------------------------------------------------------------
Average
commissions per
share paid
on equity
transactions $.063 $.065 $.066 N/A N/A N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Net of management fee waiver
**Calculated using average shares outstanding during the period
+ Not annualized.
See Notes to Financial Statements
-2-
<PAGE>
2. THE FUND
- --------------------------------------------------------------------------------
The Fund is a diversified open-end management investment company incorporated
under the laws of Maryland on August 28, 1989. The Fund is a series fund
currently comprised of one active Portfolio: the Growth and Income Portfolio
(the "Portfolio"). The Portfolio issues one separate class of shares: the
Variable Contract Class which is offered by this Prospectus. Each share of
common stock of the Fund, regardless of Class, has a par value of $.001 per
share and has one vote and an equal right to dividends and distributions with
respect to the Portfolio, except as to those dividends and distributions which
are affected by expenses unique to a class. All shares have noncumulative voting
rights for the election of Directors. Each share is fully paid, nonassessable
and freely transferable. There are no liquidation, conversion or preemptive
rights. The fiscal year-end of the Fund is December 31.
Distribution of Fund Shares
Lord Abbett Distributor LLC ("Lord Abbett Distributor"), located at The General
Motors Building, 767 Fifth Avenue, New York, New York 10153-0203, is the
distributor of the shares of the Portfolio. The Board of Directors of the Fund
has adopted a distribution plan (the "Plan") pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (the "1940 Act"), for the shares,
which has been approved by the shareholders of the Portfolio. The Plan has not
been activated to date. Under the Plan, the Variable Contract Class (the
"Class") of the Portfolio may bear certain costs of distributing shares in
accordance with the Plan. (See "Distribution Plan" below.) Shares of the Class
(the "shares") are currently issued and redeemed only in connection with
investment in and payments under certain variable annuity contracts issued by
life insurance companies and their affiliates ("Life Companies"). The shares are
purchased and redeemed at net asset value. Lord Abbett Distributor and the Fund
each reserves the right to suspend, change or withdraw the offering of shares of
any Portfolio or Portfolios or any of the terms of such offering.
Distribution Plan
Pursuant to the Plan, the Fund, on behalf of the Class, may make payments to
Lord Abbett Distributor for remittance to a Life Company for certain
distribution expenses incurred or paid by such Life Company, provided that such
remittances in the aggregate do not exceed 0.15 of 1%, on an annual basis, of
the average daily net asset value of shares of the Portfolio sold to such Life
Company to be used as the underlying investment for variable life insurance and
variable annuity contracts ("Variable Contracts"). For the year ended December
31, 1997, no payments were made pursuant to the Plan.
Distribution expenses for which a Life Company may be reimbursed include, but
are not limited to, expenses of printing and distributing Fund prospectuses,
statements of
-3-
<PAGE>
additional information and shareholder reports to existing and potential
Variable Contract owners and developing and preparing Fund advertisements and
other promotional materials designed to promote the distribution of shares. Lord
Abbett will be required to submit to the Directors for approval annual
distribution expense budgets and quarterly reports of, and requests for payment
of, distribution expenses as to the Portfolio.
Variable annuity contract owners should refer to the fee table section of their
separate account prospectuses for further information with respect to the effect
of the Plan on their annuity contract expenses.
3. INVESTMENT OBJECTIVE AND POLICIES
- --------------------------------------------------------------------------------
The Portfolio of the Fund has an investment objective that it pursues through
investment policies as described below. The Portfolio is managed by Lord, Abbett
& Co. ("Lord Abbett") and its risks and opportunities should be carefully
examined. There is no assurance that the investment objective of the Portfolio
will be met.
Growth and Income Portfolio
The investment objective of the Growth and Income Portfolio is long-term growth
of capital and income without excessive fluctuation in market value.
The Fund intends to keep the Portfolio's assets invested in those securities
which are selling at reasonable prices in relation to value and, in doing so, it
may have to forego some opportunities for gains when, in the Fund's judgment,
they carry excessive risk.
The Portfolio will try to anticipate major changes in the economy and select
stocks which it believes will benefit most from these changes.
The Portfolio will normally invest in common stocks (including securities
convertible into common stocks) of large, seasoned companies in sound financial
condition, which common stocks are expected to show above-average price
appreciation. Although the prices of common stocks fluctuate and their dividends
vary, historically, common stocks have appreciated in value and their dividends
have increased when the companies they represent have prospered and grown.
The Portfolio constantly seeks to balance the opportunity for profit against the
risk of loss. In the past, very few industries have continuously provided the
best investment opportunities. The Portfolio will take a flexible approach and
make adjustments to reflect changes in the opportunity for sound investments
relative to the risks assumed. Therefore, the Portfolio will sell stocks that
are judged to be overpriced and reinvest the proceeds in other securities which
are believed to offer better values.
-4-
<PAGE>
The Portfolio will not purchase securities for trading purposes. To create
reserve purchasing power and also for temporary defensive purposes, the
Portfolio may invest in straight bonds and other fixed-income securities.
Other Investment Policies and Techniques
When the Fund believes that the Portfolio should assume a temporary defensive
position because of unfavorable investment conditions, the Portfolio may
temporarily hold its assets in cash and short-term money market instruments.
See "Risk Factors" below for a discussion of special diversification standards
which the Portfolio will meet.
The Fund intends to utilize from time to time one or more of the investment
techniques identified below and described in the Statement of Additional
Information. It is the Fund's current intention that no more than 5% of the
Portfolio's net assets will be at risk in the use of any one of such investment
techniques identified below. While some of these techniques involve risk when
utilized independently, the Fund intends to use them to reduce risk and
volatility in the Portfolio, although this result cannot be assured by the use
of such investment techniques.
Covered Call Options. The Fund may write call options on securities it owns. A
call option on stock gives the purchaser of the option, upon payment of a
premium to the writer of the option, the right to call upon the writer to
deliver a specified number of shares of a stock on or before a fixed date at a
predetermined price.
Rights and Warrants. The Fund may invest in rights and warrants to purchase
securities. Included within these purchases, but not exceeding 2% of the value
of the Portfolio's net assets, may be warrants which are not listed on the New
York Stock Exchange or American Stock Exchange.
Repurchase Agreements. The Fund may enter into repurchase agreements with
respect to a security. A repurchase agreement is a transaction by which the Fund
acquires a security and simultaneously commits to resell that security to the
seller (a bank or securities dealer) at an agreed-upon price on an agreed-upon
date. The Fund requires at all times that the repurchase agreement be
collateralized by cash or U.S. Government securities having a value equal to, or
in excess of, the value of the repurchase agreement. Such agreements permit the
Fund to keep all of its assets at work while retaining flexibility in pursuit of
investments of a longer-term nature.
Other Policies of the Portfolio
It is the Fund's current intention that no more than 5% of the Portfolio's net
assets will be at risk in the use of any one of the policies identified below.
-5-
<PAGE>
Closed-End Investment Companies. The Fund may invest in shares of closed-end
investment companies if bought in primary or secondary offerings with a fee or
commission no greater than the customary brokers commission. Shares of such
investment companies sometimes trade at a discount or premium in relation to
their net asset value.
Lending of Portfolio Securities. The Fund may seek to earn income by lending its
Portfolio securities if the loan is collateralized and complies with regulatory
requirements.
Emergency Borrowing. The Fund will be permitted to borrow money up to one-third
of the value of the Portfolio's total assets taken at current value but only
from banks as a temporary measure for extraordinary or emergency purposes.
Beyond 5% of the Portfolio's total assets (at current value), this borrowing may
not be used for investment leverage to purchase securities. As a matter of
operating policy, the Portfolio will not borrow more than 25% of its total
assets taken at current value.
Change in Investment Objective
The Fund will not change the investment objective of the Portfolio without
shareholder approval as described below in "Investment Restrictions." However,
the Fund's policies and techniques are not fundamental. Therefore, if it is
determined that an objective of the Portfolio can best be achieved by a
substantive change in such a policy or technique, the change will be made
without shareholder approval by disclosing it in the Prospectus.
Investment Restrictions
In addition to the investment objectives set forth above, certain restrictions
relating to the investment of assets of the Portfolio are set forth in the
Statement of Additional Information. These investment restrictions are also
deemed fundamental and neither such restrictions nor the investment objectives
of the Portfolio may be changed without the approval of the holders of a
majority of the outstanding shares of the Portfolio (which for this purpose and
under the 1940 Act means the lesser of (i) 67% of the shares represented at a
meeting at which more than 50% of the outstanding shares are present or
represented by proxy or (ii) more than 50% of the outstanding shares).
4. RISK FACTORS
- --------------------------------------------------------------------------------
The Fund serves as the underlying investment for Variable Contracts issued by
the Life Companies.
Section 817(h) of the Internal Revenue Code of 1986, as amended (the "Code"),
imposes certain diversification standards on the underlying assets of Variable
Contracts held in any Portfolios of the Fund. The Code provides that a Variable
Contract shall not be
-6-
<PAGE>
treated as an annuity contract or life insurance for any period (and any
subsequent period) for which the investments are not, in accordance with
regulations prescribed by the Treasury Department, adequately diversified.
Disqualification of a Variable Contract as an annuity contract or life insurance
would result in imposition of federal income tax on contract owners with respect
to earnings allocable to the Variable Contract prior to the receipt of payments
under the Variable Contract. Section 817(h)(2) of the Code is a safe harbor
provision which provides that contracts such as the Variable Contracts meet the
diversification requirements if, as of the close of each quarter, the underlying
assets meet the diversification standards for a regulated investment company and
no more than fifty-five percent (55%) of the total assets consists of cash, cash
items, U.S. Government securities and securities of other regulated investment
companies.
On March 2, 1989, the Treasury Department issued Regulations (Treas. Reg.
1.817-5), which established diversification requirements for the investment
portfolios underlying Variable Contracts. The Regulations amplify the
diversification requirements for Variable Contracts set forth in Section 817(h)
of the Code and provide an alternative to the safe harbor provision described
above. Under the Regulations, an investment portfolio will be deemed adequately
diversified if (i) no more than 55 percent of the value of the total assets of
the portfolio is represented by any one investment; (ii) no more than 70 percent
of such value is represented by any two investments; (iii) no more than 80
percent of such value is represented by any three investments; and (iv) no more
than 90 percent of such value is represented by any four investments. For
purposes of these Regulations, all securities of the same issuer are treated as
a single investment.
The Code provides that for purposes of determining whether or not the
diversification standards imposed on the underlying assets of Variable Contracts
by Section 817(h) of the Code have been met, "each United States government
agency or instrumentality shall be treated as a separate issuer."
The Portfolio will be managed in such a manner as to comply with these
diversification requirements. It is possible that in order to comply with the
diversification requirements, less desirable investment decisions may be made
which would affect the investment performance of the Portfolio.
The prices of long-term securities are more volatile than those of short-term
debt securities. When interest rates go up or down, the market value of such
long-term debt securities tends to go down or up, respectively, to a greater
extent than in the case of short-term debt securities.
5. PORTFOLIO TURNOVER RATES
- --------------------------------------------------------------------------------
For the years ended December 31, 1996 and 1997, the portfolio turnover rates of
the Portfolio were 48.93% and 43.09%, respectively. Higher portfolio turnover
rates may
-7-
<PAGE>
involve correspondingly higher brokerage costs, which would have to be borne
directly by the Fund and ultimately by its shareholders.
6. MANAGEMENT
- --------------------------------------------------------------------------------
The Fund is managed by its officers on a day-to-day basis under the overall
direction of its Board of Directors. The Fund employs Lord Abbett as investment
manager for the Portfolio pursuant to a Management Agreement. Lord Abbett has
been an investment manager for over 68 years and currently manages approximately
$27 billion in a family of mutual funds and other advisory accounts. Lord Abbett
provides the Fund with investment management services and executive and other
personnel, pays the remuneration of its officers, provides the Fund with office
space and pays for ordinary and necessary office and clerical expenses relating
to research, statistical work and supervision of the Portfolio and certain other
costs. The Fund pays all other expenses not expressly assumed by Lord Abbett,
including, without limitation, outside Directors' fees and expenses, association
membership dues, legal and auditing fees, shareholder servicing costs, expenses
relating to shareholder meetings, expenses of preparing, printing and mailing
stock certificates and shareholder reports, expenses of registering the Fund's
shares under federal and state securities laws, expenses of printing and mailing
prospectuses to existing shareholders, insurance premiums and brokerage and
other expenses relating to the execution of Portfolio transactions. Lord Abbett
provides similar services to twelve other funds having their own investment
objectives and also advises other investment clients. Lord Abbett and Cova
Financial Services Life Insurance Company provided operating funds to the Fund
through their purchase of the initial shares of the Fund.
Mr. W. Thomas Hudson, Jr. is Executive Vice President of the Fund and is
primarily responsible for the day-to-day management of the Portfolio. Mr. Hudson
has been employed by Lord Abbett since 1982.
Under the Management Agreement, the Fund is obligated to pay Lord Abbett a
monthly fee, based on average daily net assets of the Portfolio for each month,
at an annual rate of 0.50 of 1%. In addition, the Fund will pay all expenses not
expressly assumed by Lord Abbett. For the year ended December 31, 1997, the
Portfolio of the Fund paid Lord Abbett $2,019,891 in advisory fees.
7. EXPENSES OF THE FUND
- --------------------------------------------------------------------------------
Lord Abbett may waive its management fee and/or advance other expenses of the
Fund. Although each Class must bear the expenses solely attributable to it, the
Classes are expected to experience cost savings over the aggregate amount that
would be payable if each Class were a separate fund, because they have the same
Directors, accountants, attorneys and share other general and administrative
expenses. Any expenses which are not solely attributable to a specific Class are
allocated on the basis of the net assets of the
-8-
<PAGE>
respective Classes. For the year ended December 31, 1997, the expenses borne by
the Portfolio amounted to $2,084,990 or 0.52 of 1% of its average daily net
assets.
8. SHAREHOLDER RIGHTS
- --------------------------------------------------------------------------------
The Portfolio issues one class of shares and may issue additional separate
classes of shares in the future. Each share represents an equal proportionate
interest in the assets of the Portfolio with each other share in the Portfolio.
On any matter submitted to a vote of shareholders, all shares of the Fund then
issued and outstanding and entitled to vote shall be voted in the aggregate and
not by class except for matters concerning only one class. The holder of each
share of stock of the Fund will be entitled to one vote for each full share and
a fractional vote for each fractional share of stock. Shares of one class may
not bear the same economic relationship to the Fund as shares of another class.
In accordance with its view of present applicable law, the Fund views the
separate account(s) of Life Companies as shareholders of the Fund having the
right to vote Fund shares at any meeting of shareholders and will provide
pass-through voting privileges to all contract owners. Life Companies will vote
shares of the Fund held in the separate account(s) for which no timely voting
instructions from contract owners are received, as well as shares they own, in
the same proportion as those shares for which voting instructions are received.
Additional information concerning voting rights is described in the separate
account prospectuses.
The Fund's By-Laws provide that the Fund shall not hold an annual meeting of its
shareholders in any year unless one or more matters are required to be acted on
by shareholders under the 1940 Act, or unless called at the request in writing
of a majority of the Board of Directors or by shareholders holding at least
one-quarter of the shares of the Fund outstanding and entitled to vote at the
meeting. The Fund will hold a shareholder meeting to fill existing vacancies on
the Board in the event that less than a majority of Directors were elected by
the shareholders. The Directors shall also call a meeting of shareholders for
the purpose of voting upon the question of removal of any Director when
requested in writing to do so by the record holders of not less than 10 percent
of the outstanding shares. Under the By-Laws of the Fund and in accordance with
the 1940 Act, shareholder approval of the independent auditors of the Fund will
not be required except when shareholder meetings are held. The Fund has an
obligation to assist shareholder communications.
9. PURCHASE AND REDEMPTION OF SHARES
- --------------------------------------------------------------------------------
Shares are currently only sold to the separate accounts of the Life Companies at
net asset value (see below). Redemptions will be effected by the separate
accounts to meet obligations under the Variable Contracts. Contract owners do
not deal directly with the Fund with respect to acquisition or redemption of
shares.
-9-
<PAGE>
In selecting broker-dealers to execute portfolio transactions for the Fund's
Portfolio, if two or more broker-dealers are considered capable of best
execution, the Fund may prefer the broker-dealer who has sold Fund shares
through the sale of such Variable Contracts.
-10-
<PAGE>
10. DIVIDENDS AND DISTRIBUTIONS
- --------------------------------------------------------------------------------
All dividends and distributions are distributed to the shareholders and will be
payable in shares or cash at the election of shareholders. The Life Companies,
with respect to shares held by their separate accounts, have elected, and intend
to continue to elect, to receive dividends and distributions in shares.
Dividends and distributions are made at such frequency and in such amount as to
assure compliance with the Internal Revenue Code.
11. TAX STATUS
- --------------------------------------------------------------------------------
It is the intention of the Fund to have the Portfolio qualify, and for the
fiscal year ended December 31, 1997, it did qualify, as a "regulated investment
company" under Subchapter M of the Internal Revenue Code. The Fund distributes
all of its net income and gains to its shareholders ( including the separate
accounts). The Portfolio is treated as a separate entity for federal income tax
purposes and, therefore, the investments and results of the Portfolio are
determined separately for purposes of determining whether the Portfolio
qualifies as a "regulated investment company" and for purposes of determining
net ordinary income (or loss) and net realized capital gains (or losses).
12. NET ASSET VALUE
- --------------------------------------------------------------------------------
Portfolio shares are sold and redeemed at a price equal to the share's net asset
value. Net asset value per share is determined as of the close of the New York
Stock Exchange (normally 4:00 P.M. Eastern Standard Time) on each day that the
New York Stock Exchange is open for trading by dividing the net assets of each
class by the number of shares outstanding for that class at the time of
calculation. The daily net asset value per share is also determined once daily
on each day (other than a day during which no such shares were tendered for
redemption and no order to purchase or sell such shares was received by the
Fund) in which there is a sufficient degree of trading in the Portfolio's
securities that the current net asset value of the Portfolio's shares might be
materially affected by changes in the value of the securities.
Total assets are determined by adding the total current value of the Portfolio's
securities, cash, receivables and other assets and subtracting liabilities.
Portfolio shares are sold and redeemed at the net asset value next determined
after receipt of the sales order or request for redemption.
Securities that are listed on a securities exchange are valued at their closing
sales price on the day of the valuation. Price valuations for listed securities
are based on market quotations where the security is primarily traded or, if not
available, are valued at the mean of the bid and asked prices on any valuation
date. Unlisted securities in a Portfolio are primarily valued based on their
latest quoted bid price or, if not available, are valued by a method determined
by the Directors to accurately reflect fair value. Money market
-11-
<PAGE>
instruments maturing in 60 days or less are valued on the basis of amortized
cost, which means that they are valued at their acquisition cost to reflect a
constant amortization rate to maturity of any premium or discount, rather than
at current market value.
13. PERFORMANCE
- --------------------------------------------------------------------------------
From time to time, advertisements and other sales materials for the Fund may
include information concerning the historical performance of the Fund. Total
return information will include the Portfolio's average annual compounded rate
of return for a given period, based upon the value of the shares acquired
through a hypothetical $1000 investment at the beginning of the specified period
and the net asset or redemption value of such shares at the end of the period,
assuming reinvestment of all dividends and distributions at net asset value. In
lieu of or in addition to total return calculations, such information may
include performance rankings and similar information from independent
organizations such as Lipper Analytical Services, Inc., Business Week, Forbes or
other industry publications.
Total return figures utilized by the Fund are based on historical performance
and are not intended to indicate future performance. Total return and net asset
value per share can be expected to fluctuate over time. Further information
about the Fund's performance is contained in the Annual Report to shareholders
which may be obtained, without charge, by calling 800-831-LIFE with respect to
Variable Contracts of Cova ; 800-342-6307 with respect to Variable Contracts of
Great American and 800-752-7215 with respect to the Variable Contacts of Sun
Life.
14. GENERAL INFORMATION
- --------------------------------------------------------------------------------
The Fund's custodian is The Bank of New York, 48 Wall Street, New York, New York
10286. The Fund's transfer agent and dividend disbursing agent is DST Systems,
Inc., Kansas City, Missouri 64141. The Fund's auditors are Deloitte & Touche
LLP, Two World Financial Center, New York, New York 10281. The Fund's counsel is
Debevoise & Plimpton, 875 Third Avenue, New York, New York 10022.
-12-
<PAGE>
start
STATEMENT OF ADDITIONAL INFORMATION
LORD ABBETT SERIES FUND, INC. May 1, 1998
This Statement of Additional Information is not a Prospectus. A Prospectus may
be obtained from Lord, Abbett & Co ("Lord Abbett"), The General Motors Building,
767 Fifth Avenue, New York, N.Y. 10153-0203. This Statement relates to, and
should be read in conjunction with, the Prospectus dated May 1, 1998.
Shareholder inquiries should be made by writing directly to the Fund or by
calling 800-831-LIFE with respect to Variable Contracts of Cova Financial
Services Life Insurance Company and 800 342-6307 with respect to Variable
Contracts of Great American Reserve Insurance Company.
TABLE OF CONTENTS Page
1. Investment Objectives and Policies.........................................2
2. Directors and Officers.....................................................6
3. Control Persons and Principal Holders of Securities........................9
4. Investment Advisory and Other Services....................................10
5. Portfolio Transactions....................................................11
6. Net Asset Value of Fund Shares............................................13
7. Dividends and Distributions...............................................13
8. Distribution Arrangements.................................................14
9. Taxes.....................................................................14
10. Calculation of Performance Data...........................................15
11. Financial Statements......................................................15
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<PAGE>
1.
Investment Objectives and Policies
The Fund's investment objectives and policies are described in the Prospectus
under "Investment Objectives and Policies." In addition to those investment
objectives, the Growth and Income Portfolio (the "Portfolio") is subject to the
following investment restrictions which cannot be changed without approval of a
majority of the outstanding shares of the Portfolio. The Portfolio may not: (1)
sell short securities or buy securities or evidences of interests therein on
margin, although it may obtain short-term credit necessary for the clearance of
purchases of securities; (2) buy or sell put or call options, although it may
buy, hold or sell rights or warrants, write covered call options and enter into
closing purchase transactions as discussed below; (3) borrow money which is in
excess of one-third of the value of its total assets taken at market value
(including the amount borrowed) and then only from banks as a temporary measure
for extraordinary or emergency purposes (borrowings beyond 5% of such total
assets may not be used for investment leverage to purchase securities but solely
to meet redemption requests where the liquidation of the Portfolio's investment
is deemed to be inconvenient or disadvantageous); (4) invest in securities or
other assets not readily marketable at the time of purchase or subject to legal
or contractual restrictions on resale except as described under "Restricted or
Not Readily Marketable Securities for the Fund's Portfolio" below; (5) act as
underwriter of securities issued by others, unless it is deemed to be one in
selling a portfolio security requiring registration under the Securities Act of
1933, such as those described under "Restricted or Not Readily Marketable
Securities for the Fund's Portfolio" below; (6) lend money or securities to any
person except that it may enter into short-term repurchase agreements with
sellers of securities it has purchased, and it may lend its portfolio securities
to registered broker-dealers where the loan is 100% secured by cash or its
equivalent as long as it complies with regulatory requirements and the Fund
deems such loans not to expose the Portfolio to significant risk (investment in
repurchase agreements exceeding 7 days and in other illiquid investments is
limited to a maximum of 5% of a Portfolio's assets); (7) pledge, mortgage or
hypothecate its assets; however, this provision does not apply to permitted
borrowing mentioned above or to the grant of escrow receipts or the entry into
other similar escrow arrangements arising out of the writing of covered call
options; (8) buy or sell real estate including limited partnership interests
therein (except securities of companies, such as real estate investment trusts,
that deal in real estate or interests therein), or oil, gas or other mineral
leases, commodities or commodity contracts in the ordinary course of its
business, except such interests and other property acquired as a result of
owning
-14-
<PAGE>
other securities, though securities will not be purchased in order to acquire
any of these interests; (9) invest more than 5% of its gross assets, taken at
market value at the time of investment, in companies (including their
predecessors) with less than three years' continuous operation; (10) buy
securities if the purchase would then cause a Portfolio to have more than (i) 5%
of its gross assets, at market value at the time of purchase, invested in
securities of any one issuer, except securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities, or (ii) 25% of its gross assets,
at market value at the time of purchase, invested in securities issued or
guaranteed by a foreign government, its agencies or instrumentalities; (11) buy
voting securities if the purchase would then cause a Portfolio to own more than
10% of the outstanding voting stock of any one issuer; (12) own securities in a
company when any of its officers, directors or security holders is an officer or
director of the Fund or an officer, director or partner of the Investment
Manager or sub-adviser, if after the purchase any of such persons owns
beneficially more than 1/2 of 1% of such securities and such persons together
own more than 5% of such securities; (13) concentrate its investments in any
particular industry, but if deemed appropriate for attainment of its investment
objective, up to 25% of its gross assets (at market value at the time of
investment) may be invested in any one industry classification used for
investment purposes; or (14) buy securities from or sell them to the Fund's
officers, directors, or employees, or to the Investment Manager or sub-adviser
or to their partners, directors and employees.
Changes in Fund Objectives, Restrictions, Policies and Strategies
The Fund's investment objectives described in the Prospectus and the Fund's
investment restrictions described above in this Statement of Additional
Information, both under the same heading "Investment Objectives and Policies,"
can be changed only with the approval of a majority of the outstanding shares of
the affected Portfolio. All of the Fund's policies and techniques, including
those described below, can be changed without such approval.
Other Investments. Described below are other Fund policies and techniques
applicable to one or all of the Portfolios as indicated.
Investment Techniques for the Fund's Portfolio
The Fund intends to utilize from time to time one or more of the investment
techniques described below, including covered call options, rights and warrants
and repurchase agreements. It is the Fund's current intention that no more than
5% of the Portfolio's net assets will be at risk in the use of any one of such
investment techniques. While some of these techniques involve risk when utilized
independently, the Fund intends to use them to reduce risk and volatility in its
Portfolio.
-15-
<PAGE>
Covered Call Options. The Fund may write call options on securities it owns. A
call option on stock gives the purchaser of the option, upon payment of a
premium to the writer of the option, the right to call upon the writer to
deliver a specified number of shares of a stock on or before a fixed date at a
predetermined price.
The writing of call options will, therefore, involve a potential loss of
opportunity to sell securities at higher prices. The writer of a fully
collateralized call option assumes the full downside risk of the securities
subject to such option. In addition, in exchange for the premium received, the
writer of the call gives up the gain possibility of the stock appreciating
beyond the call price. While an option that has been written is in force, the
maximum profit that may be derived from the optioned stock is the sum of the
premium (less brokerage commissions and fees) plus the difference between the
strike price of the call and the market price of the underlying security.
The Fund's custodian will segregate cash, liquid high grade debt securities or
other permitted securities in an amount not less than the value of the Fund's
assets committed to written covered call options. If the value of the securities
segregated declines, additional cash or permitted securities will be added on a
daily basis (i.e., marked to market) so that the segregated amount will not be
less than the amount of the Fund's commitments with respect to such written
options.
Rights and Warrants. The Fund may invest in rights and warrants to purchase
securities. Included within that amount, but not to exceed 2% of the value of
the Portfolio's net assets, may be warrants which are not listed on the New York
Stock Exchange or American Stock Exchange.
Rights represent a privilege offered to holders of record of issued securities
to subscribe (usually on a pro rata basis) for additional securities of the same
class, of a different class, or of a different issuer, as the case may be.
Warrants represent the privilege to purchase securities at a stipulated price
and are usually valid for several years. Rights and warrants generally do not
entitle a holder to dividends or voting rights with respect to the underlying
securities nor do they represent any rights in the assets of the issuing
company.
Also, the value of a right or warrant may not necessarily change with the value
of the underlying securities, and rights and warrants cease to have value if
they are not exercised prior to their expiration date.
Repurchase Agreements. The Fund may enter into repurchase agreements with
respect to a security. A repurchase agreement is a transaction by which the Fund
acquires a security and simultaneously commits to resell that security to the
seller (a bank or securities dealer) at an agreed-upon price on an agreed-upon
date. The resale price reflects the purchase price plus an agreed-upon market
rate of interest which is unrelated to the coupon rate or date of maturity of
the
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<PAGE>
purchased security. In this type of transaction, the securities purchased by the
Fund have a total value in excess of the value of the repurchase agreement. The
Fund requires at all times that the repurchase agreement be collateralized by
cash or U.S. government securities having a value equal to, or in excess of, the
value of the repurchase agreement. Such agreements permit the Fund to keep all
of its assets at work while retaining flexibility in pursuit of investments of a
longer-term nature.
The use of repurchase agreements involves certain risks. For example, if the
seller of the agreement defaults on its obligation to repurchase the underlying
securities at a time when the value of these securities has declined, the Fund
may incur a loss upon disposition of them. If the seller of the agreement
becomes insolvent and subject to liquidation or reorganization under the
Bankruptcy Code or other laws, a bankruptcy court may determine that the
underlying securities are collateral not within the control of the Fund and
therefore subject to sale by the trustee in bankruptcy. Even though the
repurchase agreements may have maturities of seven days or less, they may lack
liquidity, especially if the issuer encounters financial difficulties. While the
Fund acknowledges these risks, it is expected that they can be controlled
through stringent selection criteria and careful monitoring procedures. The Fund
intends to limit repurchase agreements to transactions with dealers and
financial institutions believed by the Fund to present minimal credit risks. The
Fund will monitor creditworthiness of the repurchase agreement sellers on an
ongoing basis.
Restricted or Not Readily Marketable Securities for the Fund's Portfolio
Although the Fund has no current intention of investing in such securities in
the foreseeable future, no more than 5% of the value of the Portfolio may be
invested in securities with legal or contractual restrictions on resale
("restricted securities") (including securities qualifying for resale under SEC
Rule 144A that are determined by the Board, or by Lord Abbett pursuant to the
Board's delegation, to be liquid securities, restricted securities, repurchase
agreements with maturities of more than seven days and over-the-counter
options), other than repurchase agreements and those restricted securities which
have a liquid market among certain institutions, including the Fund, and in
securities which are not readily marketable.
Lending of Securities by the Fund's Portfolio
Although the Fund has no current intention of doing so in the foreseeable
future, the Fund may seek to earn income by lending portfolio securities. Under
present regulatory policies, such loans may be made to member firms of the New
York Stock Exchange and are required to be secured continuously by collateral
consisting of cash, cash equivalents, or United States Treasury bills maintained
in an amount at least equal to the market value of the securities loaned. The
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<PAGE>
Fund will have the right to call a loan and obtain the securities loaned at any
time on five days' notice. During the existence of a loan the Fund will receive
the income earned on investment of collateral. The aggregate value of the
securities loaned will not exceed 15% of the value of the Portfolio's total
assets.
Portfolio Turnover Rates
During the fiscal year ended December 31, 1997, the portfolio turnover rate of
the Portfolio was 43.09% compared to 48.93% for the prior fiscal year.
2.
Directors and Officers
The following director and officer is a partner of Lord Abbett, The General
Motors Building, 767 Fifth Avenue, New York, N.Y. 10153-0203. He has been
associated with Lord Abbett for over five years and is also an officer and
director/trustee of the twelve other Lord Abbett-sponsored funds. He is an
"interested person" as defined in the Investment Company Act of 1940, as amended
(the "Act"), and as such, may be considered to have an indirect financial
interest in any Rule 12b-1 Plan described in the Prospectus.
Robert S. Dow, Age 53, Chairman and President
The following outside directors are also directors of the twelve other Lord
Abbett-sponsored funds referred to above.
E. Thayer Bigelow
Courtroom Television Network
600 Third Avenue
New York, New York
Chief Executive Officer of Courtroom Television Network. Formerly President and
Chief Executive Officer of Time Warner Cable Programming, Inc. Prior to that,
President and Chief Operating Officer of Home Box Office, Inc. Age 56.
Stewart S. Dixon
Wildman, Harrold, Allen & Dixon
225 W. Wacker Drive (Suite 2800)
Chicago, Illinois
Partner in the law firm of Wildman, Harrold, Allen & Dixon. Age 67.
John C. Jansing
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<PAGE>
162 S. Beach Road
Hobe Sound, Florida
Retired. Former Chairman of Independent Election Corporation of America, a proxy
tabulating firm. Age 72.
C. Alan MacDonald
Directorship Inc.
8 Sound Shore Drive
Greenwich, Connecticut
Managing Director of Directorship Inc., a consultancy in board management and
corporate governance. Formerly General Partner, The Marketing Partnership, Inc.,
a full service marketing consulting firm (1994-1997). Prior to that, Chairman
and Chief Executive Officer of Lincoln Snacks, Inc., manufacturer of branded
snack foods (1992-1994). His career spans 36 years at Stouffers and Nestle with
18 of the years as Chief Executive Officer. Currently serves as Director of
DenAmerica Corp., J. B. Williams Company, Inc., Fountainhead Water Company, and
Exigent Diagnostics. Age 64.
Hansel B. Millican, Jr.
Rochester Button Company
1100 Noblin Avenue
South Boston, Virginia
President and Chief Executive Officer of Rochester Button Company. Age 69.
Thomas J. Neff
Spencer Stuart U.S.
277 Park Avenue
New York, New York
Chairman of Spencer Stuart U.S., an executive search consulting firm. Age 60.
The second column of the following table sets forth the compensation accrued for
the Fund's outside directors. The third column sets forth information with
respect to the equity-based benefits accrued for outside directors by the Lord
Abbett-sponsored funds. The fourth sets forth the total compensation payable by
such funds to the outside directors. No director of the Fund associated with
Lord Abbett and no officer of the Fund received any compensation from the Fund
for acting as a director or officer.
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<TABLE>
<CAPTION>
For the Fiscal Year Ended December 31, 1997
(1) (2) (3) (4)
Pension or For Year Ended
Retirement Benefits December 31, 1997
Accrued by the Total Compensation
Aggregate Fund and Accrued by the Fund and
Compensation Twelve Other Lord Twelve Other Lord
Accrued by Abbett-sponsored Abbett-sponsored
Name of Director the Fund(1) Funds(2) Funds(3)
- ---------------- ------------ -------------------- ------------------------
<S> <C> <C> <C>
E. Thayer Bigelow $1,185 $17,068 $56,000
Stewart S. Dixon $1,163 $32,190 $55,000
John C. Jansing $1,163 $45,085(4) $55,000
C. Alan MacDonald $1,213 $30,703 $57,400
Hansel B. Millican, Jr. $1,163 $37,747 $55,000
Thomas J. Neff $1,185 $19,853 $56,000
</TABLE>
(1) Outside directors' fees, including attendance fees for board and committee
meetings, are allocated among all Lord Abbett-sponsored funds based on the
net assets of each fund. A portion of the fees payable by the Fund to its
outside directors is being deferred under a plan that deems the deferred
amounts to be invested in shares of the Fund for later distribution to the
directors.
(2) The amounts in Column 3 were accrued by the Lord Abbett-Sponsored Funds
for the 12 months ended December 31, 1997 with respect to the equity based
plans established for independent directors in 1996. This plan supercedes
a previously approved retirement plan for all future directors. Current
directors had the option to convert their accrued benefits under the
retirement plan. All of the outside directors except one made such an
election. Each plan also provides for a pre-retirement death benefit and
actuarially reduced joint-and-survivor spousal benefits.
(3) This column shows aggregate compensation, including directors fees and
attendance fees for board and committee meetings, of a nature referred to
in footnote one, accrued by the Lord Abbett-sponsored funds during the
year ended December 31, 1997. The amounts of the aggregate compensation
payable by the Fund as of December 31, 1997 deemed invested in Fund
shares, including dividends reinvested and changes in net asset value
applicable to such deemed investments, were: Mr. Bigelow, $ 3,135; Mr.
Dixon, $1,078; Mr. Jansing, $4,041; Mr. MacDonald, $1,040; Mr. Millican,
$4,076 and Mr. Neff, $ 4,041. If the amounts deemed invested in Fund
shares were added to each director's actual holdings of Fund shares as of
December 31, 1997, each would own, the following: Mr. Bigelow, 60 shares;
Mr. Dixon, 59 shares; Mr. Jansing, 59 shares; Mr. McDonald, 62 shares; Mr.
Millican, 59 shares; and Mr. Neff, 60 shares.
(4) Mr. Jansing chose to continue to receive benefits under the retirement
plan, which provides that outside directors (Trustees) may receive annual
retirement benefits for life equal to their final annual retainer
following retirement at or after age 72 with at least ten years of
service. Thus, if Mr. Jansing were to retire and the annual retainer
payable by the funds were the same as it is today, he would receive annual
retirement benefits of $50,000.
-20-
<PAGE>
Except where indicated, the following executive officers of the Fund have been
associated with Lord Abbett for over five years. Of the following, Messrs.
Brown, Carper, Hilstad, Hudson, Morris, Nordberg and Walsh are partners of Lord
Abbett; the others are employees: W. Thomas Hudson, age 56, Executive Vice
President; Paul A. Hilstad, age 55, Vice President and Secretary (with Lord
Abbett since 1995; formerly Senior Vice President and General Counsel of
American Capital Management & Research, Inc.); Zane E. Brown, age 46; Daniel E.
Carper, age 46; Robert G. Morris, age 53; E. Wayne Nordberg, age 59; Lawrence H.
Kaplan, age 41 (with Lord Abbett since 1997 - formerly, Vice President and Chief
Counsel of Salomon Brothers Asset Management Inc (1995-1997); prior thereto,
Senior Vice President, Director and General Counsel of Kidder Peabody Asset
Management, Inc. (1990-1995)); Thomas F. Konop, age 56; A. Edward Oberhaus, age
38; Keith O'Connor, age 42; John J. Walsh, age 62, Vice Presidents; and Donna M.
McManus, age 37, Treasurer (with Lord Abbett since 1996; formerly a Senior
Manager at Deloitte & Touche LLP).
The Fund's By-Laws provide that the Fund shall not hold an annual meeting of its
stockholders in any year unless one or more matters are required to be acted on
by stockholders under the Act, or unless called at the request of a majority of
the Board of Directors or by stockholders holding at least one-quarter of the
stock of the Fund outstanding and entitled to vote at the meeting. When any such
annual meeting is held, the stockholders will elect directors to hold the
offices of any directors who have held office for more than one year or who have
been elected by the Board of Directors to fill vacancies. Under the By-Laws and
in accordance with the Act, stockholder approval of the independent auditors of
the Fund will not be required except when such meetings are held.
3.
Control Persons and Principal Holders of Securities Substantial Shareholders
As of March 31, 1998, COVA Variable Annuity Accounts One, Five, Six, and Seven,
separate accounts of COVA Financial Services Life Insurance Company, One Tower
Lane, Oakbrook Terrace, Illinois 60181 ("COVA Life"), was known to the Board of
Directors and the management of the Fund to own of record 28,282,357 shares
representing 99.93% of the total shares issued and outstanding of the Portfolio.
As of the same date, Great American Reserve Insurance Company, 11815 North
Pennsylvania St., Carmel, Indiana 46032, and Sun Life of Canada (U.S.), 1 Copley
Place, Suite 200, Boston, Massachusetts 02116 were so known to own of record
1,408 shares representing .01% and 46 shares representing less than 1/2 of 1%,
respectively. Also, as of such date, Lord Abbett was known to own of record
17,653 shares representing .06% of the total shares issued and outstanding. As
of that date, the officers and directors of the Fund together owned no Variable
Contracts.
-21-
<PAGE>
4.
Investment Advisory and Other Services
As described under "Management" in the Prospectus, Lord Abbett is the Fund's
investment manager. Eight of the twelve general partners of Lord Abbett are
officers and/or directors of the Fund and are identified as follows: Zane E.
Brown, Daniel E. Carper, Robert S. Dow, Paul A. Hilstad, W. Thomas Hudson,
Robert G. Morris, E. Wayne Nordberg and John J. Walsh. The address of each
partner is The General Motors Building, 767 Fifth Avenue, New York, New York
10153-0203.
Lord Abbett acts as investment manager for twelve other investment companies
comprising the Lord Abbett family of funds. The names of these investment
companies are: Lord Abbett Affiliated Fund, Inc., Lord Abbett Bond-Debenture
Fund, Inc., Lord Abbett Developing Growth Fund, Inc., Lord Abbett Global Fund,
Inc., Lord Abbett Mid-Cap Value Fund, Inc., Lord Abbett Tax-Free Income Fund,
Inc., Lord Abbett Tax-Free Income Trust, Lord Abbett Equity Fund, Lord Abbett
U.S. Government Securities Money Market Fund, Inc., Lord Abbett Securities
Trust, Lord Abbett Investment Trust and Lord Abbett Research Fund, Inc.
The services to be provided by Lord Abbett are described under "Management" in
the Prospectus. Under the Management Agreement, the Fund on behalf of the
Portfolio is obligated to pay Lord Abbett a monthly fee, based on the average
daily net assets of the Portfolio for each month, at the annual rate of 0.50 of
1%. For the fiscal years ended December 31, 1995, 1996 and 1997 Lord Abbett
received $704,093, $1,234,273 and $2,019,891 in advisory fees, respectively.
The Fund pays all expenses not expressly assumed by Lord Abbett, including,
without limitation, outside directors' fees and expenses, association membership
dues, legal and auditing fees, taxes, transfer and dividend disbursing agent
fees, shareholder servicing costs, expenses relating to shareholder meetings,
expenses of preparing, printing and mailing stock certificates and shareholder
reports, expenses of registering the Fund's shares under federal and state
securities laws, expenses of printing and mailing prospectuses to existing
shareholders, insurance premiums, brokerage and other expenses connected with
executing portfolio transactions.
Deloitte & Touche LLP, Two World Financial Center, New York, New York 10281 are
the independent auditors of the Fund and must be approved at least annually by
the Fund's Board of Directors to continue in such capacity. They perform audit
services for the Fund including the examination of financial statements included
in the Fund's annual report to shareholders.
The Bank of New York ("BNY"), 48 Wall Street, New York, New York, is the Fund's
custodian. In accordance with the requirements of Rule 17f-5, the Fund's
directors have approved arrangements permitting the Fund's foreign assets not
-22-
<PAGE>
held by BNY or its foreign branches to be held by certain qualified foreign
banks and depositories.
5.
Portfolio Transactions
Our policy is to obtain best execution on all our portfolio transactions, which
means that we seek to have purchases and sales of portfolio securities executed
at the most favorable prices, considering all costs of the transaction including
brokerage commissions and dealer markups and markdowns and taking into account
the full range and quality of the brokers' services. Consistent with obtaining
best execution, we generally pay, as described below, a higher commission than
some brokers might charge on the same transactions. Our policy with respect to
best execution governs the selection of brokers or dealers and the market in
which the transaction is executed. To the extent permitted by law, we may, if
considered advantageous, make a purchase from or sale to another Lord
Abbett-sponsored fund without the intervention of any broker-dealer.
Broker-dealers are selected on the basis of their professional capability and
the value and quality of their brokerage and research services. Normally, the
selection is made by traders who are officers of the Fund and also are employees
of Lord Abbett. These traders do the trading as well for other accounts --
investment companies (of which they are also officers) and other investment
clients -- managed by Lord Abbett. They are responsible for obtaining best
execution.
We pay a commission rate that we believe is appropriate to give maximum
assurance that our brokers will provide us, on a continuing basis, the highest
level of brokerage services available. While we do not always seek the lowest
possible commissions on particular trades, we believe that our commission rates
are in line with the rates that many other institutions pay. Our traders are
authorized to pay brokerage commissions in excess of those that other brokers
might accept on the same transactions in recognition of the value of the
services performed by the executing brokers, viewed in terms of either the
particular transaction or the overall responsibilities of Lord Abbett with
respect to us and the other accounts they manage. Such services include showing
us trading opportunities including blocks, a willingness and ability to take
positions in securities, knowledge of a particular security or market proven
ability to handle a particular type of trade, confidential treatment, promptness
and reliability.
Some of these brokers also provide research services at least some of which are
useful to Lord Abbett in their overall responsibilities with respect to us and
the other accounts they manage. Research includes the furnishing of analyses and
reports concerning issuers, industries, securities, economic factors and trends,
-23-
<PAGE>
portfolio strategy and the performance of accounts and trading equipment and
computer software packages, acquired from third-party suppliers, that enable
Lord Abbett to access various information bases. Such services may be used by
Lord Abbett in servicing all their accounts, and not all of such services will
necessarily be used by Lord Abbett in connection with their management of the
Fund; conversely, such services furnished in connection with brokerage on other
accounts managed by Lord Abbett may be used in connection with their management
of the Fund, and not all of such services will necessarily be used by Lord
Abbett in connection with their advisory services to such other accounts. We
have been advised by Lord Abbett that research services received form brokers
cannot be allocated to any particular account, are not a substitute for Lord
Abbett's services but are supplemental to their own research effort and when
utilized, are subject to internal analysis before being incorporated by Lord
Abbett into their investment process. As a practical matter, it would not be
possible for Lord Abbett to generate all of the information presently provided
by brokers. While receipt of research services from brokerage firms has not
reduced Lord Abbett's normal research activities, the expenses of Lord Abbett
could be materially increased if it attempted to generate such additional
information through its own staff and purchased such equipment and software
packages directly from the suppliers.
No commitments are made regarding the allocation of brokerage business to or
among brokers, and trades are executed only when they are dictated by investment
decisions of the Fund to purchase or sell portfolio securities.
If two or more broker-dealers are considered capable of offering the equivalent
likelihood of best execution, the broker-dealer who has sold our shares and/or
shares of other Lord Abbett-sponsored funds may be preferred.
If other clients of Lord Abbett buy or sell the same security at the same time
as we do, transactions will, to the extent practicable, be allocated among all
participating accounts in proportion to the amount of each order and will be
executed daily until filled so that each account shares the average price and
commission cost of each day. Other clients who direct that their brokerage
business be placed with specific brokers or who invest through wrap accounts
introduced to Lord Abbett by certain brokers may not participate with us in the
buying and selling of the same securities as described above. If these clients
wish to buy or sell the same security as we do, they may have their transactions
executed at times different from our transactions and thus may not receive the
same price or incur the same commission cost as we do.
We will not seek "reciprocal" dealer business (for the purpose of applying
commissions in whole or in part for our benefit or otherwise) from dealers as
consideration for the direction to them of portfolio business.
-24-
<PAGE>
During the fiscal years ended December 31, 1997, 1996 and 1995, the total dollar
amounts of brokerage commissions paid by the Fund were $631,256, $389,776 and
$409,371, respectively.
6.
Net Asset Value of Fund Shares
Information concerning how we value our shares for the purchase and redemption
of our shares is contained in the Prospectus under "Purchase and Redemption of
Shares," respectively.
As disclosed in the Prospectus, we calculate our net asset value as of the close
of the New York Stock Exchange ("NYSE") (normally at 4:00 P.M. Eastern Standard
Time) on each day that the NYSE is open for trading by dividing our total net
assets by the number of shares outstanding at the time of calculation. The NYSE
is closed on Saturdays and Sundays and the following holidays -- New Year's Day,
Martin Luther King, Jr.'s Birthday (observed), Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas.
Valuation of Securities Held in the Portfolio
The Fund values its portfolio securities at market value as of the close of the
NYSE. Market value will be determined as follows: securities listed or admitted
to trading privileges on the New York or American Stock Exchange or on the
NASDAQ National Market System are valued at the last sales price, or, if there
is no sale on that day, at the mean between the last bid and asked prices, or,
in the case of bonds, in the over-the-counter market if, in the judgment of the
Fund's officers, that market more accurately reflects the market value of the
bonds. Over-the-counter securities not traded on the NASDAQ National Market
System are valued at the mean between the last bid and asked prices. Securities
for which market quotations are not available are valued at fair market value
under procedures approved by the Board of Directors.
7.
Dividends and Distributions
It is the Fund's intention to distribute substantially all the net investment
income, if any, of the Portfolio. For dividend purposes, net investment income
of the Portfolio will consist of dividends and/or interest earned by the
Portfolio less the expenses of such Portfolio.
All net realized capital gains of the Fund, if any, are declared and distributed
annually.
-25-
<PAGE>
8.
Distribution Arrangements
General
Lord Abbett Distributor LLC ("Lord Abbett Distributor") serves as the
distributor in connection with the offering of the Fund's shares. In connection
with the sale of its shares, the Fund has authorized Lord Abbett Distributor to
provide only such information and to make only such statements and
representations which are not materially misleading or which are contained in
the Fund's then current Prospectus or Statement of Additional Information or
shareholder reports in such financial and other statements which are furnished
to Lord Abbett by the Fund.
The Fund and Lord Abbett Distributor are parties to a Distribution Agreement
that continues in force until December, 1998. The Distribution Agreement may be
terminated by either party and will automatically terminate in the event of its
assignment. The Distribution Agreement may be renewed annually if specifically
approved by the Board of Directors or by vote of a majority of the outstanding
voting securities of the Fund provided that any such renewal shall be approved
by the vote of a majority of the Directors who are not parties to the
Distribution Agreement and are not "interested persons" of the Fund and have no
direct or indirect financial interest in the operation of the Distribution
Agreement.
9.
Taxes
The Fund intends to qualify as a regulated investment company under Subchapter M
of the Internal Revenue Code of 1986, as amended. Under such provisions, the
Fund will not be subject to Federal income tax on that part of its net ordinary
income and net realized capital gains which it distributes to shareholders. The
Portfolio will be treated as a separate entity for Federal income tax purposes
and, therefore, the investments and results of the Portfolio are determined
separately for purposes of determining whether the Fund qualifies as a regulated
investment company and for purposes of determining the Fund's net ordinary
income (or loss) and net realized capital gains (or losses). To qualify for
treatment as a regulated investment company, the Fund must, among other things,
derive in each taxable year at least 90% of its gross income from dividends,
interest and gains from the sale or other disposition of securities and certain
other related income and derive less than 30% of its gross income in each
taxable year from the gains (without deduction for losses) from the sale or
other disposition of securities (including, in certain circumstances, gains from
options, futures, forward contracts and foreign currencies) held for less than
three months.
-26-
<PAGE>
10.
Calculation of Performance Data
The Portfolio's average annual compounded rate of return is determined by
reference to a hypothetical $1,000 investment that includes capital appreciation
and depreciation for the stated period, according to the following formula:
P(1+T)(n) = ERV
where
P = a hypothetical initial payment of $1000
T = average annual total return
n = number of years
ERV = ending redeemable value of the hypothetical $1000 purchase
at the end of the period.
Aggregate total return is calculated in a similar manner, except that the
results are not annualized. Each calculation assumes that all dividends and
distributions are reinvested at net asset value on the reinvestment dates during
the period.
Using this method to compute average annual compounded rates of total return for
the Portfolio's last one, five and the life of the fund periods ending on
December 31, 1997 were: 24.34%, 17.87% and 16.56% respectively.
11.
Financial Statements
The financial statements for the fiscal year ended December 31, 1997 and the
report of Deloitte & Touche LLP, independent auditors, on such financial
statements contained in the 1997 Annual Report to Shareholders of Lord Abbett
Series Fund, Inc. are incorporated herein by reference to such financial
statements and report in reliance upon the authority of Deloitte & Touche LLP as
experts in auditing and accounting.
-27-
<PAGE>
LORD ABBETT SERIES FUND, INC.
ARTICLES OF RESTATEMENT
FIRST: LORD ABBETT SERIES FUND, INC., a Maryland corporation, (the
"Corporation") desires to restate its charter as currently in effect.
SECOND: The following provisions are all the provisions of the
charter currently in effect.
RESTATED ARTICLES OF INCORPORATION
OF
LORD ABBETT SERIES FUND, INC.
ARTICLE I
I, the subscriber, Kenneth B. Cutler, whose post office address is
767 Fifth Avenue, New York, New York 10153, being over eighteen years of age, am
acting as incorporator with the intention of forming a corporation under and by
virtue of the general laws of the State of Maryland authorizing the formation of
corporations.
ARTICLE II
The name of the corporation (hereinafter called the "Corporation")
is Lord Abbett Series Fund, Inc.
ARTICLE III
The current post office address of the place at which the principal
office of the Corporation in the State of Maryland is located is c/o The
Prentice-Hall Corporation System, Maryland, 11 East Chase Street, Baltimore,
Maryland 21202.
The Corporation's current resident agent is The Prentice-Hall
Corporation System, Maryland, 11 East Chase Street, Baltimore, Maryland 21202.
Said resident agent is a corporation in the State of Maryland.
ARTICLE IV
The purpose or purposes for which the Corporation is formed and the
business or objects to be transacted, carried on and promoted by it, are as
follows:
A. To conduct, operate and carry on the business of an investment
company.
<PAGE>
B. To purchase, subscribe for, invest in or otherwise acquire, and
to own, hold, sell, possess, transfer or otherwise dispose of, or turn to
account or realize upon, and generally deal in, all forms of securities of every
nature, kind, character, type and form, including but not limited to, shares,
stocks, bonds, debentures, notes, scrip, participation certificates, rights to
subscribe, warrants, options, certificates of deposit, chooses in action,
evidences of indebtedness, certificates of indebtedness and certificates of
interest of any and every kind and nature whatsoever, secured and unsecured,
issued or to be issued, by any corporation, partnership, association, trust,
entity or person, public or private, whether organized under the laws of the
United States, or any state, commonwealth, territory or possession thereof, or
organized under the laws of any foreign country.
C. To issue, sell, repurchase, redeem, retire, cancel, acquire,
resell, transfer, and otherwise deal in shares of the capital stock of the
Corporation, and to apply to any such repurchase, redemption, retirement,
cancellation or acquisition of shares of capital stock of the Corporation, any
funds of the Corporation, whether capital, surplus or otherwise to the full
extent permitted by the laws of Maryland, all without the vote or consent of the
stockholders of the Corporation.
D. To deposit any of its assets in any bank, trust company or other
depository, domestic or foreign, and to retain any of its assets in the currency
of the United States or of any foreign country.
E. To conduct its business in the State of Maryland, all other
states and elsewhere in any part of the world, and to have one or more offices
outside the State of Maryland.
F. To do any and all things herein set forth, and in addition such
other acts and things as are necessary or convenient to the attainment of the
purposes of this Corporation, or any of them, to the same extent as natural
persons lawfully might or could do in any part of the world, and to engage in
any lawful act or activity for which corporations may be organized under the
laws of the State of Maryland.
The foregoing objects and purposes shall, except as otherwise
expressly provided, be in no way limited or restricted by reference to, or
inference from the terms of any other clause of this or any other Article of
these Articles of Incorporation, and shall each be regarded as independent, and
construed as powers as well as objects and purposes, and the enumeration of
specific purposes, objects and powers shall not be
2
<PAGE>
construed to limit or restrict in any manner the meaning of general terms or the
general powers of the Corporation now or hereafter conferred by the laws of the
State of Maryland, nor shall the expression of one thing be deemed to exclude
another, though it be of like nature, not expressed; provided, however, that the
Corporation shall not have power to carry on within the State of Maryland any
business whatsoever the carrying on of which would preclude it from being
classified as an ordinary business corporation under the laws of said State; nor
shall any of the foregoing statements of its objects, purposes and powers be
deemed to permit the Corporation to carry on any business, or exercise any
powers, in any state, territory, district or county except to the extent that
the same may lawfully be carried on or exercised under the laws thereof.
ARTICLE V
SECTION 1. The total number of shares which the Corporation has
authority to issue is 1,000,000,000 shares of capital stock of the par value of
$.001 each (the "Shares"), having an aggregate par value of $1,000,000. The
Shares shall initially constitute three classes designated initially as the
"Growth & Income Class", consisting of 50,000,000 Shares, the "Growth Class",
consisting of 50,000,000 Shares and the "Global Equity Class", consisting of
50,000,000 Shares. The Board of Directors shall have the power and authority to
further classify or reclassify any unissued Shares from time to time, including
the power and authority to allocate classes of Shares (including classes of
unissued Shares with classes of Issued Shares) to series of Shares, by setting
or changing the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption of such classes and series of Shares. For the purpose
of these Articles of Incorporation, the term "Class" shall mean such an initial
separate and distinct class of Shares and any further separate and distinct
class of Shares from time to time created by the Board of Directors and the term
"Series" shall mean a series of Shares to which any two or more Classes are
allocated by the Board of Directors. The Board of Directors shall also have the
power and authority to redesignate any class of series of issued Shares by
setting forth such redesignation in Articles Supplementary filed with the
Maryland State Department of Assessments and Taxation.
[On November 6, 1996, the Articles of Incorporation of the Corporation
were further supplemented by the filing of Articles Supplementary with the State
Department of Assessments and Taxation of Maryland which specified the legal
name for the existing Growth and Income Class of the Corporation as the
"Variable Contract Class."
3
<PAGE>
On November 6, 1996, the Articles of Incorporation of the Corporation were
further supplemented by the filing of Articles Supplementary with the State
Department of Assessments and Taxation of Maryland which, pursuant to the power
and authority of the Board of Directors of the Corporation to classify and
reclassify unissued Shares of stock of the Corporation, including the power and
authority to allocate Classes of Shares to Series of Shares, classified the
capital stock of the Corporation by (a) classifying from previously unclassified
Shares, 50,000,000 authorized but unissued Shares as the "Pension Class," and
(b) allocating the Variable Contact Class and the Pension Class to a Series of
Shares designated as the "Growth and Income Portfolio" (the "Portfolio"). Such
Articles Supplementary further provided that all Shares of a Class or of a
Series shall represent the same interest in the Corporation and have the same
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption as the other Shares of that Class or Series, except to the extent
that the Board of Directors provides for differing preferences, conversion or
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, or terms or conditions of redemption of Shares of such Classes
or such Series as determined pursuant to the Articles, or as otherwise
determined pursuant to those Articles Supplementary or additional Articles
Supplementary filed for record with the State Department of Assessments and
Taxation of Maryland, or by the Board of Directors in accordance with law.
Such Articles Supplementary further provided that subject to the power of
the Board of Directors to classify and reclassify unissued shares, all Shares of
the Pension Class and the Variable Contract Class of the Portfolio shall be
invested in the investment portfolio of the Corporation, and shall have the same
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption set forth in Article V of the Articles of Incorporation of the
Corporation and shall be subject to all other provisions of the Articles of
Incorporation relating to stock of the Corporation generally and to the
provisions of those Articles Supplementary.
Such Articles Supplementary further provided that liabilities and expenses
relating solely to a particular Class of the Portfolio (including, without
limitation, distribution expenses under a plan in effect adopted for such Class
pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended (the
"Act"), and administrative expenses under an administration or service
agreement, plan or other arrangement, however designated, which may be adopted
for such Class) shall be allocated to and borne by such Class of the Portfolio
to the extent determined by the Board of Directors, and shall be
4
<PAGE>
appropriately reflected (in the manner determined by the Board of Directors) in
the net asset value, dividends and distributions and liquidation rights of the
Shares of such Class.
Such Articles Supplementary further provided that dividends paid by the
Corporation on each Class of Shares of the Portfolio, to the extent any
dividends are paid, will be calculated in the same manner, will be paid at the
same time, and will be in the same amount, except that (a) any expenses
allocated to a Class of the Portfolio, in the manner set forth under those
Articles Supplementary, shall be borne exclusively by that Class and (b) income,
realized and unrealized capital gains and losses and expense not allocated to a
Class of the Portfolio shall be allocated to each Class on the basis of the net
asset value of that Class in relation to the net asset value of the Portfolio.
Such Articles Supplementary further provided that the net asset value of
each Share of a Class of the Portfolio shall be determined in accordance with
the Articles with appropriate adjustments to reflect the allocations of
expenses, income, and realized and unrealized capital gains and losses of the
Portfolio between its Classes as provided above. The assets belonging to each
Class shall be combined and the assets belonging to such Class shall be an
undivided interest in such combined assets, the percentage of which shall be
determined from time to time on the basis of the net asset value of that Class,
in relation to the net asset value of the Portfolio.]
SECTION 2. A description of the relative preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption of all Classes of Shares
is as follows, unless otherwise set forth in Articles Supplementary filed with
the Maryland State Department of Assessments and Taxation describing any further
Class or Classes or any Series from time to time created by the Board of
Directors:
(a) Assets Belonging to Class. All consideration received by the
Corporation for the issuance or sale of Shares of a particular Class,
together with all assets in which consideration is invested or reinvested,
all income, earnings, profits and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation of such assets, and any
funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall belong to that Class for all
purposes, subject only to the rights of creditors, and shall be so
recorded upon the books of account of the Corporation. Such consideration,
assets, income, earnings, profits and proceeds, including any proceeds
derived from the sale, exchange or liquidation of such assets, and any
funds or payments derived from any reinvestment of such proceeds, in
whatever form the same may
5
<PAGE>
be, together with any unallocated items (as hereinafter defined) relating
to that Class as provided in the following sentence, are herein referred
to as "assets belonging to" that Class. In the event that there are any
assets, income, earnings, profits or proceeds thereof, funds or payments
that are not readily identifiable as belonging to any particular Class
(collectively "Unallocated Items"), the Board of Directors shall allocate
such Unallocated Items to and among any one or more of the Classes created
from time to time in such manner and on such basis as it, in its sole
discretion, deems fair and equitable; and any Unallocated Items so
allocated to a particular Class shall belong to that Class. Each such
allocation by the Board of Directors shall be conclusive and binding upon
stockholders of all Classes for all purposes. If two or more Classes
comprise a Series, the assets belonging to each such Class shall be
combined and the assets belonging to each such Class shall be combined and
the assets belonging to such a Class shall be an undivided interest in
such combined assets, the percentage of which shall be determined in the
manner set forth in the Articles Supplementary filed with the Maryland
State Department of Assessments and Taxation describing such Series.
(b) Liabilities Belonging to Class. The assets belonging to each
particular Class shall be charged with the liabilities of the Corporation
in respect of that Class and with all expenses, costs, charges and
reserves attributable to that Class, and shall be so recorded upon the
books of account of the Corporation. Such liabilities, expenses, costs,
charges and reserves, together with any unallocated items (as hereinafter
defined) relating to that Class as provided in the following sentence, so
charged to that Class, are herein referred to as "liabilities belonging
to" that Class. In the event there are any unallocated liabilities,
expenses, costs, charges or reserves of the Corporation which are not
readily identifiable as belonging to any particular Class (collectively
"Unallocated Items"), the Board of Directors shall allocate and charge
such Unallocated Items to and among any one or more of the Classes created
from time to time in such manner and on such basis as the Board of
Directors in its sole discretion deems fair and equitable; and any
Unallocated Items so allocated and charged to a particular Class shall
belong to that Class. Each such allocation by the Board of Directors shall
be conclusive and binding upon the stockholders of all Classes for all
purposes.
(c) Dividends. Dividends and distributions on Shares of a particular
Class may be paid to the holders of Shares of that Class at such times, in
such manner and from such of the income and capital gains, accrued or
realized, from the assets belonging to that Class, after providing for
actual and accrued liabilities belonging to that Class, as the Board of
Directors may determine.
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(d) Liquidation. In the event of the liquidation or dissolution of
the Corporation the stockholders of each Class that has been created shall
be entitled to receive, as a Class, when and as declared by the Board of
Directors, the excess of the assets belonging to that Class over the
liabilities belonging to that Class. The assets so distributable to the
stockholders of any particular class shall be distributed among such
stockholders in proportion to the number of shares of the Class held by
them and recorded on the books of the Corporation.
(e) Voting. On each matter submitted to vote of the stockholders,
each holder of a Share shall be entitled to one vote for each such Share
standing in his name on the books of the Corporation irrespective of the
Class thereof and all Shares of all Classes shall vote as a single class
("Single Class Voting"); provided, however, that (i) as to any matter with
respect to which a separate vote of any Class or Series is required by the
Investment Company Act of 1940 or would be required under the Maryland
General Corporation Law, such requirements as to a separate vote by that
Class or Series shall apply in lieu of Single Class Voting as described
above; (ii) in the event that the separate vote requirements referred to
in (i) above apply with respect to one or more Classes or Series or
classes, then, subject to (iii) below, the Shares of all other Classes
shall vote as a single class; and (iii) as to any matter which does not
affect the interest of a particular Class or Series, only the holders of
Shares of the one or more affected Classes or Series shall be entitled to
vote.
(f) Equality. All Shares of each particular Class shall represent an
equal proportionate interest in the assets belonging to that Class
(subject to the liabilities belonging to that Class), and each Share of
any particular Class shall be equal to each other Share of that Class, but
the provisions of this sentence shall not restrict any distinctions that
may exist with respect to stockholder elections to receive dividends or
distributions in cash or Shares or that may otherwise exist with respect
to dividends and distributions on Shares of the same Class.
SECTION 3. The Shares of the Corporation, of any Class, shall be
subject to the following provisions:
(a) All Shares now or hereafter authorized, of any Class, shall be
subject to redemption and be redeemable at the option of the stockholder,
in the sense used in the general laws of the State of Maryland authorizing
the formation of corporations. Each holder of the Shares, upon request to
the Corporation accompanied by surrender (to the Corporation, or an agent
designated by it) of the
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appropriate stock certificate or certificates, if any, in proper form for
transfer, and such other instruments as the Board of Directors may
require, shall be entitled to require the Corporation to redeem all or any
part of the Shares outstanding in the name of such holder on the books of
the Corporation, at a redemption price for Shares of that Class equal to
the net asset value of such Shares of that Class determined as hereinafter
set forth, less a charge, not to exceed one percent (1%) of such net asset
value, if and as fixed by resolution of the Board of Directors of the
Corporation from time to time.
(b) Notwithstanding the foregoing, the Board of Directors of the
Corporation may suspend the right of the holders of the Shares of any
Class to require the Corporation to redeem Shares or may suspend any
voluntary purchase of such Shares:
(i) for any period (A) during which the New York Stock
Exchange is closed other than the customary weekend and holiday
closing, or (B) during which trading on the New York Stock Exchange
is restricted;
(ii) for any period during which an emergency, as defined by
the rules of the Securities and Exchange Commission or any successor
thereto, exists as a result of which (A) disposal by the Corporation
of securities owned by it is not reasonably practicable, or (B) it
is not reasonably practicable for the Corporation fairly to
determine the value of its net assets; or
(iii) for such other periods as the Securities and Exchange
Commission or any successor thereto may by order permit for the
protection of security holders of the Corporation.
(c) the Corporation, pursuant to a resolution of the Board of
Directors and without the vote or consent of stockholders of the
Corporation, shall have the right to redeem at net asset value all Shares,
of any Class, in any stockholder account in which there are less than 25
Shares or such lesser number of Shares as shall be specified in such
resolution. Such resolution shall set forth that redemption of Shares in
such accounts has been determined to be necessary to reduce
disproportionately burdensome expenses in servicing stockholder accounts,
or to be otherwise in the economic best interest of the Corporation. Such
resolution shall provide that prior notice of at least 30 days shall be
given to a
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stockholder before such redemption of shares and the stockholder will have
30 days (or such longer period as is specified in the resolution) from the
date of the notice to avoid such redemption by increasing his account to
at least 25 Shares, or such lesser number of Shares as is specified in the
resolution.
SECTION 4. Notwithstanding any provision of Maryland law requiring
any action to be taken or authorized by the affirmative vote of the holders of a
designated proportion greater than a majority of the Shares outstanding or of
the votes entitled to be cast, such action shall be effective and valid if taken
or authorized by the affirmative vote of the holders of a majority of the total
number of Shares outstanding or entitled to vote thereon pursuant to the
provisions of these Articles of Incorporation.
SECTION 5. No holder of stock of the Corporation shall, as such
holder, have any right to purchase or subscribe for any Shares which the
Corporation may issue or sell (whether out of the number of Shares now or
hereafter authorized by these Articles of Incorporation, or any amendment
thereof, or out of any Shares acquired by the Corporation after the issue
thereof, or otherwise) other than such right, if any, as the Board of Directors,
in its discretion, may determine.
ARTICLE VI
The current number of directors of the Corporation is eight, and the
names of those who shall act as such until their successors are duly elected and
qualify are as follows:
Robert S. Dow
E. Wayne Nordberg
E. Thayer Bigelow
Stewart S. Dixon
John C. Jansing
C. Alan MacDonald
Hansel B. Millican
Thomas J. Neff
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However, the By-Laws of the Corporation may fix the number of directors at a
number other than eight and may authorize the Board of Directors, by the vote of
a majority of the entire Board of Directors, to divide the Board into classes,
to increase or decrease the number of directors within a limit specified in the
By-Laws, provided that in no case shall the number of directors be less than
three, and to fill the vacancies created by any such increase in the number of
directors. Unless otherwise provided in the By-Laws of the Corporation, the
directors of the Corporation need not be stockholders.
ARTICLE VII
The following provisions are inserted for the management of the
business and conduct of the affairs of the Corporation, and to create, define,
limit and regulate the powers of the Corporation, the directors and the
stockholders.
SECTION 1. In furtherance and not in limitation of the powers
conferred by the statute and pursuant to these Articles of Incorporation, the
Board of Directors is expressly authorized to do the following:
(a) To make, adopt, alter, amend and repeal By-Laws of the
Corporation.
(b) To declare (from interest, dividends or other income received or
accrued, from accruals of original issue or other discounts on obligations
held, from capital or other profits on portfolio assets whether realized
or unrealized, from surplus whether earned, capital or paid in from any
other lawful sources with respect to a particular Class) dividends and
distributions on the Corporation's Shares, with respect to such Class, for
payment in cash, property or the Corporation's own stock to stockholders
of record on such dates (which may be as frequently as every day) and
payable at such intervals as the Board of Directors shall determine at any
time in advance of such payment, whether or not the amount of such payment
can at that time be determined or must be calculated subsequent to
declaration and prior to payment by reference to amounts or other factors
not yet determined at the time of declaration (including but not limited
to the amount of a dividend or distribution to be determined only be
reference to what is sufficient to enable the Corporation to qualify as a
regulated investment company under the United States Internal Revenue Code
or to avoid liability for Federal income tax); provided that if a dividend
is paid from any source other than earned
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surplus, the source of the dividend shall be disclosed not later than at
the time of payment to the stockholders of such Class or Classes who
receive it (the authority granted by this subsection (b) to permit,
without limitation, and if otherwise lawful: the declaration of dividends
or distributions by means of a formula or other similar method of
determination whether or not the amount of such dividend or distribution
can be calculated at the time of such declaration; establishing record or
payment dates for dividends or distributions on any basis, including
establishing a number of record or payment dates subsequent to the
declaration at any dividend or distribution; establishing the same payment
date for any number of dividends or distributions declared prior to such
date; providing for the payment of dividends or distributions declared and
as yet unpaid to stockholders of the Corporation redeeming shares prior to
the payment date otherwise applicable; and providing in advance for the
conditions under which any dividend or distribution may be payable in the
Corporation's own shares to all or less than all of the Corporation's
stockholders with respect to a particular Class and for the calculation of
any transfer from earned surplus to capital surplus in excess of the
transfer to the stated capital of the aggregate par value of the shares of
a particular Class so to be issued, whether such dividend or distribution
is in authorized but unissued or in treasury shares of the Corporation).
(c) To issue and sell or to cause the issuance and sale of Shares,
of any Class, in such amounts and on such terms and conditions, for such
purpose and for such amount or kind of consideration as is now or
hereafter permitted by the laws of the State of Maryland and in accordance
with the Investment Company Act of 1940.
(d) To purchase and to cause to be purchased Shares, of any Class,
pursuant to these Articles of Incorporation, upon tender thereof by the
holder or holders thereof or otherwise, provided the Corporation has
assets belonging to that Class legally available for such purpose whether
arising out of paid-in surplus, other surplus, net profits or otherwise,
to such extent and in such manner and upon such terms as the Board of
Directors shall deem expedient, and to pay for such Shares in cash
belonging to that Class then held or owned by the Corporation.
(e) To authorize, subject to such vote, consent, or approval of
stockholders and other conditions, if any, as may be required by any
applicable statute, rule or regulation, the execution and performance by
the Corporation of an agreement or agreements with any person,
corporation, association, partnership, or other organization whereby,
subject to the supervision and control of the Board of
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Directors, any such other person, corporation, association, partnership,
or other organization, shall render managerial, investment advisory and
related services to the Corporation (including, if deemed advisable, the
management or supervision of the investment portfolios of the Corporation)
upon such terms and conditions as may be provided in such agreement or
agreements.
(f) To authorize, subject to such vote, consent or approval of
stockholders and other conditions, if any, as may be required by any
applicable statute, rule or regulation, the execution and performance by
the Corporation of an agreement or agreements, which may be exclusive,
with any person, corporation, association, partnership or other
organization, as distributor, providing for the sale and distribution of
the Shares. Such agreement or agreements may provide for the charge by the
Corporation of a premium over the net asset value (determined as
hereinafter provided) of such Shares and allowance of a discount by the
Corporation to such distributor, and may further provide for the
reallowance by such distributor of concessions or commissions from but not
exceeding such discount; provided, however, that such discount shall not
exceed the amount of the premium. Such agreement may also provide for the
payment of certain distribution expenses by the Corporation.
(g) To authorize any agreement of the character described in
subsection (e) or (f) of this Section 1 with any person, corporation,
association, partnership or other organization, although one or more of
the members of the Board of Directors or officers of the Corporation may
be the other party to any such agreement or an officer, director,
shareholder, or member of such other party, and no such agreement shall be
invalidated or rendered voidable by reason of the existence of any such
relationship. Any director of the Corporation who is also a director or
officer of such corporation or who is so interested may be counted in
determining the existence of a quorum at any meeting of the Board of
Directors which shall authorize any such agreement, and may vote thereat
to authorize any such contract or transaction, with like force and effect
as if he were not such director or officer of such other corporation or
not so interested. Any agreement entered into pursuant to said subsections
(e) or (f) shall be consistent with and subject to the requirements of the
Investment Company Act of 1940 (including any amendment thereof or other
applicable Act of Congress hereafter enacted), and no amendment to any
agreement entered into pursuant to said subsection (e) (other than an
amendment reducing the compensation of the other party thereto) shall be
effective unless assented to by the affirmative vote of a majority of the
outstanding
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voting securities of the Corporation (and of each Class affected by such
amendment) as such phrase is defined in the Investment Company Act of
1940.
SECTION 2. The Board of Directors may authorize the purchase by the
Corporation, either directly or through any agent, of the Shares, of any Class,
in the open market or otherwise, at prices not in excess of the net asset value
of such Shares (determined as hereinafter provided) as of a time determined by
the Board of Directors reasonably proximate to the time of purchase by the
Corporation or any such agent.
SECTION 3. For the purposes referred to in these Articles of
Incorporation, the net asset value of the Shares of a particular Class as of any
particular time shall be determined by or pursuant to the direction of the Board
of Directors as follows:
(a) The net asset value of each Share, of any Class, at any
particular time, shall be the quotient, carried out to not less than two
decimal points, obtained by dividing the net value of the assets of the
Corporation belonging to that Class (determined as hereinafter provided)
as of such determination time by the total number of Shares of that Class
then outstanding, including all Shares of that Class which the Corporation
has agreed to sell for which the price has been determined, and excluding
Shares of that Class which have been surrendered to the Corporation or an
agent and which the Corporation has agreed to purchase, for which the
price has been determined.
The net value of the assets of the Corporation of a Class as of any
such determination time shall be determined in accordance with sound
accounting practice by deducting from the gross value of the assets of the
Corporation belonging to that Class (determined as hereinafter provided)
at such time, the amount of all liabilities belonging to that Class,
including accrued expenses, such reserves as may be set up to cover taxes
and any other liabilities, and such other deductions belonging to such
Class as in the opinion of the Board of Directors of the Corporation are
in accordance with sound accounting practice.
The gross value of the assets of the Corporation of a Class at any
such determination time shall be an amount equal to all cash, receivables,
the market value of all securities for which market quotations are readily
available and the fair value of other assets of the Corporation belonging
to that Class at such determination time, all determined in accordance
with sound accounting practice and giving effect to the following:
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(1) the market value as of any such determination time of any
security owned by the Corporation which is traded in the NASDAQ
National Market System or is listed or admitted to trading
privileges on the New York Stock Exchange or the American Stock
Exchange shall be the last sale price or (in the case of a security
in which there has been no previously reported sale transaction
since the last determination time) the mean between the last bid
price and the last asked price, for such security on such exchange
or in such market system. In case securities being valued are listed
or admitted to trading privileges on any securities exchange other
than the New York Stock Exchange, the American Stock Exchange, or
the NASDAQ National Market System, the securities exchange, sale
transactions or bid or asked prices which are to be used as
aforesaid shall be selected by the Board of Directors or any officer
or other person designated by the Board of Directors for the
purpose.
(2) The market value of securities traded in an
over-the-counter market and not traded in the NASDAQ National Market
System, shall be the mean between the last bid and asked price in
such market prior to such determination time.
(3) The market value of other property, including any
securities which are neither listed nor admitted to trading
privileges on any exchange or traded in an over-the-counter market,
shall be determined in good faith in such manner as the Board of
Directors shall prescribe from time to time.
(4) The determination of the market value of securities
hereunder may be made in reliance on any recognized source of
quotations or basis for ascertaining quotations.
(5) If a security is traded in more than one market, a
determination may be made as to which market most accurately
reflects the value of such security.
(b) The Board of Directors is empowered, in its discretion, to
establish other methods for determining such net asset value whenever such
other methods are deemed by it to be necessary or desirable, including,
but without limiting the generality of the foregoing, any method deemed
necessary or desirable in order to
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enable the Corporation to comply with any provision of the Investment
Company Act of 1940 or any rule or regulation thereunder.
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<PAGE>
SECTION 4. The presence in person or by proxy of the holders of
one-third of the Shares of all Classes issued and outstanding and entitled to
vote thereat shall constitute a quorum for the transaction of any business at
all meetings of the shareholders, except as otherwise provided by law or in
these Articles of Incorporation and except that where the holders of Shares of
any Class are entitled to a separate vote as a Class (a "Separate Class") or
where the holders of Shares of two or more (but not all) Classes are required to
vote as a single class (a "Combined Class"), the presence in person or by proxy
of the holders of one-third of the Shares of that Separate Class or Combined
Class, as the case may be, issued and outstanding and entitled to vote thereat
shall constitute a quorum for such vote. If, however, a quorum with respect to
all Classes, a Separate Class or a Combined Class, as the case may be, shall not
be present or represented at any meeting of the shareholders, the holders of a
majority of the Shares of all Classes, such Separate Class or such Combined
Class, as the case may be, present in person or by proxy and entitled to vote
shall have power to adjourn the meeting from time to time as to all Classes,
such Separate Class or such Combined Class, as the case may be, without notice
other than announcement at the meeting, until the requisite number of Shares
entitled to vote at such meeting shall be present. At such adjourned meeting at
which the requisite number of Shares entitled to vote thereat shall be
represented any business may be transacted which might have been transacted at
the meeting as originally notified. The absence from any meeting of stockholders
of the number of Shares in excess of one-third of the Shares of all Classes or
of the affected Class or Classes, as the case may be, which may be required by
the laws of the State of Maryland, the Investment Company Act of 1940 or any
other applicable law, or by these Articles of Incorporation, for action upon any
given matter shall not prevent action at such meeting upon any other matter or
matters which may properly come before the meeting, if there shall be present
thereat, in person or by proxy, holders of the number of Shares required for
action in respect of such other matter or matters.
SECTION 5. Any determination as to any of the following matters made
by or pursuant to the direction of the Board of Directors consistent with these
Articles of Incorporation and in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of duties, shall be final and conclusive
and shall be binding upon the Corporation and every holder of the Shares, of any
Class, namely, the amount of the assets, obligations, liabilities and expenses
of the Corporation belonging to any Class; the amount of the net income of the
Corporation from dividends and interest for any period and the amount of assets
at any time legally available for the payment of dividends with respect to any
Class; the amount of paid-in surplus, other surplus, annual or other net
profits, or net assets in excess of capital, undivided profits, or excess of
profits over losses
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on sales of securities belonging to any Class; the amount, purpose, time of
creation, increase or decrease, alteration or cancellation of any reserves or
charges and the propriety thereof (whether or not any obligation or liability
for which such reserves or charges shall have been created shall have been paid
or discharged) with respect to any Class; the market value, or any sale, bid or
asked price to be applied in determining the market value, of any security owned
or held by the Corporation with respect to any Class; the fair value of any
asset owned by the Corporation; the number of Shares of the Corporation of any
Class issued or outstanding; the existence of conditions permitting the
postponement of payment of the repurchase price of Shares of Class or the
suspension of the right of redemption as provided by law; any matter relating to
the acquisition, holding and disposition of securities and other assets by the
Corporation belonging to any Class; any question as to whether any transaction
constitutes a purchase of securities on margin, a short sale of securities, or
an underwriting of the sale of, or participation in any underwriting or selling
group in connection with the public distribution of any securities; and any
matter relating to the issue, sale, repurchase and/or other acquisition or
disposition of Shares of any Class.
SECTION 6. The Corporation is adopting its corporate title through
permission of the firm of Lord, Abbett & Co., which is entering into a
management or advisory contract with the Corporation. Such contract shall make
appropriate provisions that upon the termination of such contract for any cause,
or if such firm or subsidiary or affiliate or successor deems it advisable to
withdraw the right to the use of its name, the Corporation will, at the request
of such firm or a subsidiary, affiliate or successor lawfully using the name,
take such action as may be necessary to change its name to eliminate all use of
or reference to the words "Lord Abbett" in any form and will not use the
registered service mark of Lord, Abbett & Co., without the written consent of
such firm, subsidiary, affiliate or successor. The Corporation shall also agree
in such contract that investment companies other than the Corporation for which
such firm or a subsidiary successor may act as investment adviser, and other
companies affiliated with Lord, Abbett & Co., may be formed with the words "Lord
Abbett" in their corporate titles. Such agreements on the part of the
Corporation are hereby made binding upon it, its directors, officers,
stockholders, creditors and all other persons claiming under or through it.
ARTICLE VIII
To the fullest extent permitted by Maryland statutory or decisional
law, as amended from time to time, no director or officer of the Corporation
shall be personally
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liable to the Corporation or its stockholders for money damages, except to the
extent such exemption from liability or limitation thereof is not permitted by
the Investment Company Act of 1940, as amended from time to time. No amendment
of these Articles or repeal of any of its provisions shall limit or eliminate
the benefits provided to directors and officers under this provision with
respect to any act or omission which occurred prior to such amendment or repeal.
ARTICLE IX
From time to time any of the provisions of these Articles of
Incorporation may be amended, altered or repealed (including any amendment that
changes the terms of any of the outstanding Shares by classification,
reclassification or otherwise), and other provisions that might, under the
statutes of the State of Maryland at the time in force, be lawfully contained in
Articles of Incorporation may be added or inserted, upon the vote of the holders
of a majority of the Shares of all Classes or of the affected Classes, as the
case may be, at the time outstanding and entitled to vote, and all rights at any
time conferred upon the stockholders of the Corporation by these Articles of
Incorporation are subject to the provisions of this Article IX.
THIRD: The foregoing restatement of the charter has been approved by
a majority of the entire board of directors.
FOURTH: The charter is not amended by these Articles of Restatement.
FIFTH: The current address of the principal office of the
Corporation is set forth in Article III of the foregoing restatement of the
charter.
SIXTH: The name and address of the Corporation's current resident
agent are set forth in Article III of the foregoing restatement of the charter.
SEVENTH: The number of directors of the Corporation and the names of
those currently in office are set forth in Article VI of the foregoing
restatement of the charter.
The undersigned Vice President acknowledges these Articles of
Restatement to be the corporate act of the Corporation and as to all matters or
facts set forth herein required to be verified under oath, the undersigned Vice
President
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acknowledges that to the best of his knowledge, information and belief, these
matters and facts are true in all material respects and that this statement is
made under the penalties of perjury.
IN WITNESS WHEREOF, the Corporation has caused these Articles to be
signed in its name and on its behalf by its Vice President and witnessed to by
its Secretary on this 24th day of April, 1998.
LORD ABBETT SERIES FUND, INC.
By/s/ Thomas F. Konop
--------------------------------
Thomas F. Konop, Vice President
WITNESS:
/s/ Paul A. Hilstad
- --------------------------
Paul A. Hilstad, Secretary
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BY-LAWS
OF
LORD ABBETT SERIES FUND, INC.
ARTICLE I
OFFICES
Section 1. Principal Office. The principal office of the
Corporation in Maryland shall be in the City of Baltimore, and the name of the
resident agent in charge thereof is The Prentice-Hall Corporation Systems,
Maryland.
Section 2. Other Offices. The Corporation may also have an
office in the City and State of New York and offices at such other places as the
Board of Directors may from time to time determine.
ARTICLE II
STOCKHOLDERS MEETINGS
Section 1. Annual Meetings. The Corporation shall not hold an
annual meeting of its stockholders in any fiscal year of the Corporation unless
required in accordance with the following sentence. The Chairman of the Board or
the President shall call an annual meeting of the stockholders when one or more
matters are required to be acted on by stockholders under the Investment Company
Act of 1940, as amended, and the Chairman of the Board, the President, a Vice
President, the Secretary or any director shall call an annual meeting of
stockholders at the request in writing of a majority of the Board of Directors
or of stockholders holding at least one quarter of the stock of the Corporation
outstanding and entitled to vote at the meeting. Any annual meeting of the
stockholders held pursuant to the foregoing sentence shall be held at such time
and at such place, within the City of New York or elsewhere, as may be fixed by
the Chairman of the Board or the President or the Board of Directors or by the
stockholders holding at least one-quarter of the stock of the Corporation
outstanding and entitled to vote, as the case may be, and as may be stated in
the notice setting forth such call, provided that any stockholders requesting
such meeting shall have paid to the Corporation the reasonably estimated cost of
preparing and mailing the notice thereof, which the Secretary shall determine
and specify to the stockholders. Any meeting of stockholders held in accordance
with this Section 1 shall for all purposes constitute the annual meeting of
stockholders for the fiscal year of the Corporation in which the meeting is held
and, without limiting the generality of the foregoing, shall be held for the
purposes of (a) acting on any such matter of matters so required to be acted on
by stockholders under the Investment Company Act of 1940, as amended, and (b)
electing directors, and for transacting such other business as may properly be
bought before the meeting. Only such business, in addition to that prescribed by
law, by the Articles of Incorporation and by these By-Laws, may be brought
before such meeting as may be specified by resolution of the Board of Directors
or by writing filed with the Secretary of the Corporation and signed by the
Chairman of the Board or by the President or by a majority of the directors or
by stockholders holding at least one-quarter of the stock of the Corporation
outstanding and entitled to vote at the meeting.
Section 2. Special meetings. Special meetings of the
stockholders for any purpose or purposes may be held upon call by the Chairman
of the Board or by a majority of the Board of Directors, and shall be called by
the Chairman of the Board, the President, a Vice President, the Secretary or any
director at the request in writing of a majority of the Board of Directors or of
stockholders holding at least one-quarter of the stock of the Corporation
outstanding and entitled to vote at the meeting, at such time and at such place
where an annual meeting of stockholders could be held, as may be fixed by the
Chairman of the Board, the President or the Board of Directors or by the
stockholders holding at least one-quarter of the stock of the Corporation
outstanding and so entitled to vote, as the case may be, and as may be stated in
the notice setting forth such call. Such request shall state the purpose or
purposes of the proposed meeting, and only such purpose or purposes so specified
may properly be brought before such meeting.
<PAGE>
Section 3. Notice of Meetings. Written or printed notice of
every annual or special meeting of stockholders, stating the time and place
thereof and the general nature of the business proposed to be transacted at any
such meeting, shall be delivered personally or mailed not less than 10 nor more
than 90 days previous thereto to each stockholder of record entitled to vote at
the meeting at his address as the same appears on the books of the Corporation.
Meetings may be held without notice if all of the stockholders entitled to vote
are present or represented at the meeting, or if notice is waived in writing,
either before or after the meeting, by those not present or represented at the
meeting. No notice of an adjourned meeting of the stockholders other than an
announcement of the time and place thereof at the preceding meeting shall be
required.
<PAGE>
Section 4. Quorum. The presence in person or by proxy of the
holders of a majority of the Shares of all Classes issued and outstanding and
entitled to vote thereat shall constitute a quorum for the transaction of any
business at all meetings of the shareholders except as otherwise provided by law
or in the Articles of Incorporation and except that where the holders of Shares
of any Class are entitled to a separate vote as a Class (a "Separate Class") or
where the holders of Shares of two or more (but not all) Classes are required to
vote as a single Class (a "Combined Class"), the presence in person or by proxy
of the holders of a majority of the Shares of that Separate Class or Combined
Class, as the case may be, issued and outstanding and entitled to vote thereat
shall constitute a quorum for such vote. If, however, a quorum with respect to
all Classes, a Separate Class or a Combined Class, as the case may be, issued
and outstanding and entitled to vote thereat shall constitute a quorum for such
vote. If, however, a quorum with respect to all Classes, a Separate Class or a
Combined Class, as the case may be, shall not be present or represented at any
meeting of the shareholders, the holders of a majority of the Shares of all
Classes, such Separate Class or such Combined Class, as the case may be, present
in person or by proxy and entitled to vote shall have power to adjourn the
meeting from time to time as to all Classes, such Separate Class or such
Combined Class, as the case may be, without notice other than announcement at
the meeting, until the requisite number of Shares entitled to vote at such
meeting shall be present. At such adjourned meeting at which the requisite
number of Shares entitled to vote thereat shall be represented any business may
be transacted at the meeting as originally notified. The absence from any
meeting of stockholders of the number of Shares in excess of a majority of the
Shares of all Classes or of the affected Class or Classes, as the case may be,
which may be required by the laws of the State of Maryland, the Investment
Company Act of 1940 or any other applicable law or the Articles of
Incorporation, for action upon any given matter shall not prevent action of such
meeting upon any other matter or matters which may properly come before the
meeting, if there shall be present thereat, in person or by proxy, holders of
the number of Shares required for action in respect of such matter or matters.
<PAGE>
Section 5. Voting. All elections shall be had and all
questions decided by a majority of the votes cast, without regard to Class, at a
duly constituted meeting, except as otherwise provided by law or by the Articles
of Incorporation or by these By-Laws and except that with respect to a question
as to which the holders of Shares of any Class or Classes are entitled or
required to vote as a Separate Class or a Combined Class, as the case may be,
such question shall be decided as to such Separate Class or such Combined Class,
as the case may be, by a majority of the votes cast by Shares of such Separate
Class or such Combined Class, as the case may be.
With respect to all Shares having voting rights (a) a
shareholder may vote the Shares owned of record by him either in person or by
proxy executed in writing by the shareholder or by his duly authorized
attorney-in-fact, provided that no proxy shall be valid after eleven months from
its date unless otherwise provided in the proxy and (b) in all elections for
directors every shareholder shall have the right to vote, in person or by proxy,
the Shares owned of record by him, for as many persons as there are directors to
be elected and for whose election he has a right to vote.
ARTICLE III
BOARD OF DIRECTORS
Section 1. General Powers. The property, affairs and business
of the corporation shall be managed by the Board of Directors, provided,
however, that the Board of Directors may authorize the Corporation to enter into
an agreement or agreements with any person, corporation, association,
partnership or other organization, subject to the Board's supervision and
control, for the purpose of providing managerial, investment advisory and
related services to the Corporation which may include management or supervision
of the investment portfolio of the Corporation.
<PAGE>
Section 2. Number, Class Quorum, Election, Term of Office and
Qualifications. The Board of Directors of the Corporation shall consist of not
less than three or more than fifteen persons, none of whom need be stockholders
of the corporation. The number of directors (within the above limits) shall be
determined by the Board of Directors from time to time, as it sees fit, by vote
of a majority of the whole Board. Directors shall consist of one class only. The
directors shall be elected at each annual meeting of stockholders and, whether
or not elected for a specific term, shall hold office, unless sooner removed,
until their respective successors are elected and qualify.
One-third of the whole Board, but in no event less than two,
shall constitute a quorum for the transaction of business, but if at any meeting
of the Board there shall be less than a quorum present, a majority of the
directors present may adjourn the meeting from time to time until a quorum shall
have been obtained, when any business may be transacted which might have been
transacted at the meeting as originally convened. No notice of an adjourned
meeting of the directors other than an announcement of the time and place
thereof at the preceding meeting shall be required. The acts of the majority of
the directors present at any meeting at which there is a quorum shall be the
acts of the Board, except as otherwise provided by law, by the Articles of
Incorporation or by these By-Laws.
<PAGE>
Section 3. Vacancies. The Board of Directors, by vote of a
majority of the whole Board, may elect directors to fill vacancies in the Board
resulting from an increase in the number of directors or from any other cause.
Directors so chosen shall hold office until their respective successors are
elected and qualify, unless sooner displaced pursuant to law or these By-Laws.
The stockholders, at any meeting called for the purpose, may, with or without
cause, remove any director by the affirmative vote of the holders of a majority
of the votes entitled to be cast, and at any meeting called for the purpose may
fill the vacancy in the Board thus caused.
Section 4. Regular Meetings. Regular meetings of the Board of
Directors shall be held at such time and place, within or without the State of
Maryland, as may from time to time be fixed by Resolution of the Board or as may
be specified in the notice of any meeting. No notice of regular meetings of the
Board shall be required except as required by the Investment Company Act of
1940, as amended.
<PAGE>
Section 5. Special Meetings. Special meetings of the Board of
Directors may be called from time to time by the Chairman of the Board, the
President, any Vice President or any two directors. Each special meeting of the
Board shall be held at such place, either within or outside of the State of
Maryland, as shall be designated in the notice of such meeting. Notice of each
such meeting shall be mailed to each director, at his residence or usual place
of business, at least two days before the day of the meeting, or shall be
directed to him at such place by telegraph or cable, or be delivered to him
personally not later than the day before the day of the meeting. Every such
notice shall state the time and place of the meeting but need not state the
purposes thereof, except as otherwise expressly provided in these By-Laws or by
statute.
Section 6. Telephonic Conference Meetings. Any meeting of the
Board or any committee thereof may be held by conference telephone, regardless
where each director may be located at the time, by means of which all persons
participating in the meeting can hear each other, and participation in such
meeting in such manner shall constitute presence in person at such meeting,
except where the Investment Company Act of 1940, as amended, specifically
requires that the vote of such director be cast in person.
Section 7. Fees and Expenses. The directors shall receive such
fees and expenses for services to the Corporation as may be fixed by the Board
of Directors, subject however, to such limitations as may be provided in the
Articles of Incorporation. Nothing herein contained shall be construed to
preclude any director from serving the Corporation in any other capacity as an
officer, agent or otherwise and receiving compensation therefor.
<PAGE>
Section 8. Transactions with Directors. Except as otherwise
provided by law or in the Articles of Incorporation, a director of the
Corporation shall not in the absence of fraud be disqualified from office by
dealing or contracting with the Corporation either as a vendor, purchaser or
otherwise, nor in the absence of fraud shall any transaction or contract of the
Corporation be void or voidable or affected by reason of the fact that any
director, or any firm of which any director is a member, or any corporation of
which any director is an officer, director or stockholder, is in any way
interested in such transaction or contract; provided that at the meeting of the
Board of Directors, at which said contract or transaction is authorized or
confirmed, the existence of an interest of such director, firm or corporation is
disclosed or made known and there shall be present a quorum of the Board of
Directors a majority of which, consisting of directors not so interested, shall
approve such contract or transaction. Nor shall any director be liable to
account to the Corporation for any profit realized by him from or through any
such transaction or contract of the Corporation ratified or approved as
aforesaid, by reason of the fact that he or any firm of which he is a member, or
any corporation of which he is an officer, director, or stockholder, was
interested in such transaction or contract. Directors so interested may be
counted when present at meetings of the Board of Directors for the purpose of
determining the existence of a quorum. Any contract, transaction or act of the
Corporation or of the Board of Directors (whether or not approved or ratified as
hereinabove provided) which shall be ratified by a majority of the votes cast at
any annual or special meeting at which a quorum is present called for such
purpose, or approved in writing by a majority in interest of the stockholders
having voting power without a meeting, shall, except as otherwise provided by
law, be valid and as binding as though ratified by every stockholder of the
Corporation.
<PAGE>
Section 9. Committees. The Board of Directors may, by
resolution adopted by a majority of the whole Board, designate one or more
committees each such committee to consist of two or more directors of the
Corporation, which, to the extent permitted by law and provided in said
resolution, shall have and may exercise the powers of the Board over the
business and affairs of the Corporation, and may have power to authorize the
seal of the Corporation to be affixed to all papers which may require it. Such
committee or committees shall have such name or names as may be determined from
time to time by resolution adopted by the Board of Directors. A majority of the
members of any such committee may determine its action and fix the time and
place of its meetings, unless the Board of Directors shall otherwise provide.
The Board of Directors shall have power at any time to change the membership of,
to fill vacancies in, or to dissolve any such committee.
Section 10. Written Consents. Any action required or permitted
to be taken at any meeting of the Board of Directors or by any committee thereof
may be taken without a meeting, if a written consent thereto is signed by all
members of the Board or of such committee, as the case may be, and such written
consent is filed with the minutes or proceedings of the Board or committee.
<PAGE>
Section 11. Waiver of Notice. Whenever under the provisions of
these By-Laws, or of the Articles of Incorporation, or of any of the laws of the
State of Maryland, or other applicable statue, the Board of Directors is
authorized to hold any meeting or take any action after notice or after the
lapse of any prescribed period of time, a waiver thereof, in writing, signed by
the person or persons entitled to such notice or lapse of time, whether signed
before or after the time of meeting or action stated herein, shall be deemed
equivalent thereto. The presence at any meeting of a person or persons entitled
to notice thereof shall be deemed a waiver of such notice as to such person or
persons.
ARTICLE IV
OFFICERS
Section 1. Number and Designation. The Board of Directors
shall each year appoint from among their members a Chairman and a President of
the Corporation, and shall appoint one or more Vice Presidents, a Secretary and
a Treasurer and, from time to time, any other officers and agents as it may deem
proper. Any two of the above mentioned offices, except those of the President
and a Vice President, may be held by the same person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity if such
instrument be required by law or by these By-Laws to be executed, acknowledged
or verified by any two or more officers.
Section 2. Term of Office. The term of office of all officers
shall be one year or until their respective successors are chosen; but any
officer or agent chosen or appointed by the Board of Directors may be removed,
with or without cause, at any time, by the affirmative vote of a majority of the
members of the Board then in office.
<PAGE>
Section 3. Duties. Subject to such limitations as the Board of
Directors may from time to time prescribe, the officers of the Corporation shall
each have such powers and duties as generally appertain to their respective
offices, as well as such powers and duties as from time to time may be conferred
by the Board of Directors.
ARTICLE V
CERTIFICATE OF STOCK
Section 1. Form and Issuance. Each stockholder of the
Corporation, of a particular Class, shall be entitled upon request, to a
certificate or certificates, in such form as the Board of Directors may from
time to time prescribe, which shall represent and certify the number of shares
of stock of the Corporation of that Class of stock owned by such stockholder.
The certificates for shares of stock of the Corporation shall bear the
signature, either manual or facsimile, of the Chairman of the Board, the
President or a Vice President and the Treasurer or an Assistant Treasurer or the
Secretary or an Assistant Secretary, and shall be sealed with the seal of the
Corporation or bear a facsimile of such seal. The validity of any stock
certificate shall not be affected if any officer whose signature appears thereon
ceases to be an officer of the Corporation before such certificate is issued.
<PAGE>
Section 2. Transfer of Stock. The shares of stock of the
Corporation of any Class shall be transferable on the books of the Corporation
by the holder thereof in person or by a duly authorized attorney, upon surrender
for cancellation of a certificate or certificates for a like number of shares,
with a duly executed assignment and power of transfer endorsed thereon or
attached thereto, or, if no certificate has been issued to the holder in respect
of shares of stock of the Corporation, upon receipt of written instructions,
signed by such holder, to transfer such shares from the account maintained in
the name of such holder by the Corporation or its agent. Such proof of the
authenticity of the signatures as the Corporation or its agent may reasonably
require shall be provided.
<PAGE>
Section 3. Lost, Stolen, Destroyed and Mutilated Certificates.
The holder of any stock of the Corporation of any Class shall immediately notify
the Corporation of any loss, theft, destruction or mutilation of any certificate
therefore, and the Board of Directors may, in its discretion, cause to be issued
to him a new certificate or certificates of stock of the same Class, upon the
surrender of the mutilated certificate or in case of loss, theft or destruction
of the certificate upon satisfactory proof of such loss, theft or destruction of
the certificate upon satisfactory proof of such loss, theft, or destruction; and
the Board of Directors may, in its discretion, require the owner of the lost,
stolen or destroyed certificate, or his legal representatives, to give to the
Corporation and to such registrar or transfer agent as may be authorized or
required to countersign such new certificate or certificates a bond, in such sum
as they may direct, and with such surety or sureties, as they may direct, as
indemnity against any claim that may be made against them or any of them on
account of or in connection with the alleged loss, theft, or destruction of any
such certificate.
<PAGE>
Section 4. Record Date. The Board of Directors may fix, in
advance, a date as the record date for the purpose of determining stockholders,
of any Class, entitled to notice of, or to vote at, any meeting of stockholders
of any Class, or stockholders of any Class entitled to receive payment of any
dividend or the allotment of any rights, or in order to make a determination of
stockholders of any Class for any other proper purpose. Such date, in any case,
shall be not more than 90 days, and in case of a meeting of stockholders, not
less than 10 days, prior to the date on which the particular action requiring
such determination of stockholders is to be taken. In lieu of fixing a record
date, the Board of Directors may provide that the stock transfer books shall be
closed for a stated period but not to exceed, in any case, 20 days prior to the
date of any meeting of stockholders or the date for payment of any divided or
the allotment of rights. If the stock transfer books are closed for the purpose
of determining stockholders entitled to notice of or to vote at a meeting of
stockholders, such books shall be closed for at least 10 days immediately
preceding such meeting. If no record date for the determination of stockholders
entitled to notice of, or to vote at, a meeting of stockholders shall be at the
close of business on the day on which notice of the meeting is mailed or the day
30 days before the meeting, whichever is the closer date to the meeting, and the
record date for the determination of stockholders entitled to receive payment of
a dividend or an allotment of any rights shall be at the close of business on
the day on which the resolution of the Board of Directors declaring the dividend
or allotment of rights is adopted, provided that the payment or allotment date
shall not be more than 90 days after the date of the adoption of such
resolution.
ARTICLE VI
CORPORATE BOOKS
The books of the Corporation may be kept outside the State of
Maryland at such place or places as the Board of Directors may from time to time
determine. The original or duplicate stock ledger shall be maintained at the
office of the Corporation's transfer agent.
ARTICLE VII
SIGNATURES
Except as otherwise provided in these By-Laws or as the Board
of Directors may generally or in particular cases authorize the execution
thereof in some other manner, all deeds, leases, transfers, contracts, bonds,
notes, checks, drafts and other obligations made, accepted or endorsed by the
Corporation and all endorsements, assignments, transfers, stock powers or other
instruments of transfer of securities owned by or standing in the name of the
Corporation shall be signed or executed by two officers of the Corporation, who
shall be the Chairman, the President or a Vice President and a Vice President,
the Secretary or the Treasurer.
ARTICLE VIII
FISCAL YEAR
The fiscal year of the Corporation shall be established by
resolution of the Board of Directors of the Corporation.
ARTICLE IX
CORPORATE SEAL
The corporate seal of the Corporation shall consist of a flat
faced circular die with the word "Maryland" together with the name of the
Corporation, the year of its organization, and such other appropriate legend as
the Board of Directors may from time to time determine, cut or engraved thereon.
In lieu of the corporate seal, when so authorized by the Board of Directors or a
duly empowered committee thereof, a facsimile thereof may be impressed or
affixed or reproduced.
<PAGE>
ARTICLE X
INDEMNIFICATION
As part of the consideration for agreeing to serve and serving
as a director of the Corporation, each director of the Corporation shall be
indemnified by the Corporation against every judgment, penalty, fine,
settlement, and reasonable expense (including attorneys' fees) actually incurred
by the director in connection with any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, in
which the director was, is, or is threatened to be made a named defendant or
respondent (or otherwise becomes a party) by reason of such director's service
in that capacity or status as such, and the amount of every such judgment,
penalty, fine, settlement and reasonable expense so incurred by the director
shall be paid by the Corporation or, if paid by the director, reimbursed to the
director by the Corporation, subject only to the conditions and limitations
imposed by the applicable provisions of Section 2-418 of the Corporations and
Associations Article of the Annotated Code of the State of Maryland and by the
provisions of Section 17(h) of the United States Investment Company Act of 1940
as interpreted and as required to be implemented by Securities and Exchange
Commission Release No. IC-11330 of September 4, 1980. The foregoing shall not
limit the authority of the Corporation to indemnify any of its officers,
employees, or agents to the extent consistent with applicable law.
<PAGE>
ARTICLE XI
AMENDMENTS
All By-Laws of the Corporation shall be subject to alteration,
amendment, or repeal, and new By-Laws not inconsistent with any provision of the
Articles of Incorporation of the Corporation may be made, either by the
affirmative vote of the holders of record of a majority of the outstanding stock
of the Corporation entitled to vote in respect thereof, given at an annual
meeting or at any special meeting, provided notice of the proposed alteration,
amendment or repeal of the proposed new By-Laws is included in or accompanies
the notice of such meeting, or by the affirmative vote of a majority of the
whole Board of Directors given at a regular or special meeting of the Board of
Directors, provided that the notice of any such special meeting indicates that
the By-Laws are to be altered, amended, repealed, or that new By-Laws are to be
adopted.
ARTICLE XII
COMPLIANCE WITH INVESTMENT COMPANY ACT OF 1940
Investment Company Act of 1940. No provision of the By-Laws of
the Corporation shall be given effect to the extent inconsistent with the
requirements of the Investment Company Act of 1940, as amended.
CONSENT OF INDEPENDENT AUDITORS
Lord Abbett Series Fund, Inc.:
We consent to the incorporation by reference in Post-Effective Amendment 12 to
Registration Statement No. 33-31072 of our report dated January 28, 1998
appearing in the annual report to shareholders and to the references to us under
the captions "Financial Highlights" and "General Information" in the Prospectus
and to the references to us under the captions "Investment Advisory and Other
Services" and "Financial Statements" in the Statement of Additional Information,
both of which are part of such Registration Statement.
DELOITTE & TOUCHE LLP
New York, New York
April 27, 1998
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