SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [XXX]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
SMITH BARNEY SERIES FUND
(Name of Registrant as Specified In Its Charter)
CAREN CUNNINGHAM
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11 (c) (1)(ii), 14a-6 (i)(1), or 14a-
6(j)(2) or the 1940 Act Rule 20a-1.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-
11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
EQUITY INDEX PORTFOLIO
A SUB-TRUST OF
SMITH BARNEY SERIES FUND
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 27, 1995
To the Shareholders of:
EQUITY INDEX PORTFOLIO:
Notice is hereby given that a Special Meeting of Shareholders of Equity
Index Portfolio (the "Portfolio"), an investment series organized as a
sub-trust of Smith Barney Series Fund (the "Trust"), will be held at the
offices of the Portfolio, 388 Greenwich Street, 26th floor, New York, New
York 10013, at 3:00 p.m. on April 27, 1995, for the following purposes:
1. To approve or disapprove a new investment advisory agreement between
the Trust, on behalf of the Portfolio, and Travelers Investment Man-
agement Company, a wholly-owned subsidiary of Smith Barney Holdings,
Inc., the parent company of the Portfolio's distributor and its admin-
istrator, containing substantially the same terms and conditions, in-
cluding the same level of fees, as the Portfolio's current investment
advisory agreement (PROPOSAL 1).
2. To transact such other business as may properly come before the Spe-
cial Meeting or any adjournment(s) thereof.
The Board of Trustees has fixed the close of business on March 13, 1995,
as the record date for the determination of shareholders of the Portfolio
entitled to notice of and to vote at the Special Meeting.
By Order of the Board of Trustees,
CHRISTINA T. SYDOR
Secretary
March 30, 1995
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE SPECIAL MEETING ARE REQUESTED
TO COMPLETE, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY CARD IN THE EN-
CLOSED ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES.
INSTRUCTIONS FOR THE PROPER EXECUTION OF THE PROXY CARD ARE SET FORTH ON
THE INSIDE COVER OF THIS NOTICE. IT IS IMPORTANT THAT PROXIES BE RETURNED
PROMPTLY.
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance
to you and avoid the time and expense to the Portfolio involved in vali-
dating your vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the reg-
istration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to the name shown in the registration
on the proxy card.
3. All Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of regis-
tration. For example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURE
CORPORATE ACCOUNTS
<S> <C>
(1) ABC Corp. ABC Corp.
(2) ABC Corp. John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer John Doe
(4) ABC Corp. Profit Sharing Plan John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78 Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA John B. Smith
(2) Estate of John B. Smith John B. Smith, Jr., Executor
</TABLE>
EQUITY INDEX PORTFOLIO
A SUB-TRUST OF
SMITH BARNEY SERIES FUND
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 27, 1995
PROXY STATEMENT
This Proxy Statement is being furnished to annuity contract owners ("Con-
tract Owners") with assets invested in IDS Life Account SLB, a separate
account of IDS Life Insurance Company ("IDS Life"), and in IDS Life of New
York Account SLB (together with the IDS Life Account SLB, the "Accounts"),
a separate account of IDS Life Insurance Company of New York ("IDS Life of
New York"), having contract value allocated to the Equity Index Portfolio
(the "Portfolio") of Smith Barney Series Fund (the "Trust"). IDS Life's
address is IDS Tower 10, Minneapolis, Minnesota 55440. IDS Life of New
York is a wholly owned subsidiary of IDS Life. IDS Life of New York's ad-
dress is 20 Madison Avenue Extension, Albany, New York 12203. This Proxy
Statement relates to solicitation of proxies by the Board of Trustees (the
"Board") of the Trust with respect to the Portfolio, for use at a Special
Meeting of Shareholders of the Portfolio to be held at 3:00 p.m. on April
27, 1995, at the offices of the Portfolio, 388 Greenwich Street, 26th
floor, New York, New York 10013, and at any adjournments thereof (collec-
tively, the "Special Meeting"). A Notice of Special Meeting of Sharehold-
ers and a proxy card accompany this Proxy Statement. Proxy solicitations
will be made primarily by mail, but proxy solicitations may also be made
by telephone, telegraph or personal interviews conducted by officers and
employees of: the Portfolio; Smith Barney Mutual Funds Management Inc.
("SBMFM"), the administrator of the Portfolio; Smith Barney, Inc. ("Smith
Barney"), the distributor of the shares for the Portfolio; The Shareholder
Services Group, Inc. ("TSSG"), a subsidiary of First Data Corporation, the
transfer agent of the Portfolio; and/or The Boston Company Advisors, Inc.
("Boston Advisors"), the sub-administrator of the Portfolio. The costs of
proxy solicitation and expenses incurred in connection with the prepara-
tion of this Proxy Statement and its enclosures will be paid by Smith Bar-
ney. A copy of the annual report of the Portfolio dated December 31, 1994,
is available upon request and without charge by writing to the Portfolio
at the address listed above or by calling 1-800-224-7523.
All of the outstanding shares of the Portfolio are sold exclusively to,
and held of record by IDS Life or IDS Life of New York, for the benefit of
owners of the Accounts ("Contract Owners"). With respect to the Meeting,
Contract Owners have the right to instruct IDS Life and IDS Life of New
York how to vote shares of the Portfolio attributable to the value of
their contract allocated to the Portfolio, through the Accounts, on any
matter affecting the Portfolio. Each share is entitled to one vote, and
any fractional share is entitled to a fractional vote. Each Contract Owner
has the right to direct the votes of that number of shares of the Portfo-
lio determined by multiplying the total number of shares of the Portfolio
outstanding by a fraction, the numerator of which is the number of units
held by such Contract Owner in the Portfolio and the denominator of which
is the total number of units of the Portfolio outstanding on the Record
Date (as defined below). Units reflect the Contract Owner's ownership in
the Accounts, while shares reflect IDS Life's and IDS Life of New York's
ownership in the Portfolio. The value of units is based on the net asset
value of the underlying portfolio adjusted for separate account fees. If
proper instructions are not received from a Contract Owner, the shares
with respect to which the Contract Owner has the right to direct votes
will be voted by IDS Life and IDS Life of New York in the same ratio as
those shares for which proper instructions were received from other Con-
tract Owners. In addition, IDS Life and IDS Life of New York will vote the
shares for which they have voting rights in the same proportion as the
votes for which they have received proper instructions.
The Trust currently issues one class of shares of beneficial interest in
respect of the Portfolio at par value of $.001 per share. If the enclosed
proxy is properly executed and returned in time to be voted at the Special
Meeting, the shares represented by the proxy will be voted in accordance
with the instructions marked thereon. UNLESS INSTRUCTIONS TO THE CONTRARY
ARE MARKED ON THE PROXY, IT WILL BE VOTED FOR THE MATTERS LISTED IN THE
ACCOMPANYING NOTICE OF SPECIAL MEETING OF SHAREHOLDERS. Any shareholder
who has given a proxy has the right to revoke it at any time prior to its
exercise either by attending the Special Meeting and voting his or her
shares in person, or by submitting a letter of revocation or a later-dated
proxy to the Portfolio at the above address prior to the date of the Spe-
cial Meeting. For purposes of determining the presence of a quorum for
transacting business at the Special Meeting, abstentions and broker "non-
votes" (i.e., proxies from brokers or nominees indicating that such per-
sons have not received instructions from the beneficial owner or other
persons entitled to vote shares on a particular matter with respect to
which the brokers or nominees do not have discretionary power) will be
treated as shares that are present but which have not been voted. For this
reason, abstention and broker "non-votes" will have the effect of a "no"
vote for purposes of obtaining the requisite approval of the proposal.
In the event that a quorum is not present at the Special Meeting, the per-
sons named as proxies on the enclosed proxy card may propose one or more
adjournments of the Special Meeting to permit further solicitation of
proxies. In determining whether to adjourn the Special Meeting, the fol-
lowing factors may be considered: the nature of the proposal that is the
subject of the Special Meeting, the percentage of votes actually cast, the
percentage of negative votes actually cast, the nature of any further so-
licitation and the information to be provided to shareholders with respect
to the reasons for the solicitation. Any adjournment will require the af-
firmative vote of a majority of those shares represented at the Special
Meeting in person or by proxy. Under the Trust's Master Trust Agreement
dated May 13, 1991, as amended (the "Master Trust Agreement"), a quorum of
shareholders is constituted by the presence in person or by proxy of the
holders of a majority of the outstanding shares of the Portfolio entitled
to vote at the Special Meeting.
The Board has fixed the close of business on March 13, 1995 as the record
date (the "Record Date") for the determination of shareholders of the
Portfolio entitled to notice of and to vote at the Special Meeting. At the
close of business as of the Record Date, there were 862,096.320 shares of
the Portfolio outstanding. Record Date, to the knowledge of the Portfolio
and the Board, no single shareholder or "group" (as that term is used in
Section 13(d) of the Securities Exchange Act of 1934) beneficially owned
more than 5% of the outstanding shares of the Portfolio with the exception
of Joyce Vonbothmer, 1040 Fifth Avenue, New York, New York 10028, who
owned 7% of the Portfolio. As of the Record Date, the officers and Board
Members beneficially owned less than 1% of the shares of the Portfolio. At
the Record Date, no shares of Travelers Investment Management Company
("TIMCO") or its ultimate parent corporation, The Travelers Inc. ("Travel-
ers") or PanAgora Management or any of its subsidiaries or parent compa-
nies, were held by Board Members.
In order that your shares may be represented at the Special Meeting you
are requested to:
-- indicate your instructions on the enclosed proxy card;
-- date and sign the proxy card;
-- mail the proxy card promptly in the enclosed envelope, which requires
no postage if mailed in the United States; and
-- allow sufficient time for the proxy card to be received on or before
5:00 p.m. on April 26, 1995
As a business trust formed under the laws of the Commonwealth of Massachu-
setts, the Trust is not required to hold annual shareholder meetings but
may hold special meetings as required or deemed desirable. As indicated
above, the Special Meeting is being called to consider a new investment
advisory contract for the Portfolio.
The Board recommends an affirmative vote on Proposal 1.
PROPOSAL 1
TO APPROVE OR DISAPPROVE A NEW INVESTMENT ADVISORY AGREEMENT BETWEEN TRAV-
ELERS INVESTMENT MANAGEMENT COMPANY AND THE TRUST, ON BEHALF OF THE PORT-
FOLIO, CONTAINING SUBSTANTIALLY THE SAME TERMS AND CONDITIONS, INCLUDING
THE SAME LEVEL OF FEES, AS THE PORTFOLIO'S CURRENT INVESTMENT ADVISORY
AGREEMENT.
SUMMARY OF PROPOSAL
For the reasons and based on an extensive analysis of factors described
below, the Trustees of the Trust unanimously determined, subject to ap-
proval by the shareholders of the Portfolio, to enter into a new invest-
ment advisory agreement (the "New Agreement") between the Portfolio and
TIMCO, a wholly owned subsidiary of Smith Barney Holdings, Inc. ("Hold-
ings"), which in turn is a wholly owned subsidiary of Travelers, the ulti-
mate parent company of the Portfolio's distributor and administrator. Pa-
nAgora Asset Management, Inc. ("PanAgora Management") is currently the
Portfolio's investment adviser under an agreement (the "Current Agree-
ment") that will terminate on March 31, 1995, pursuant to notice duly
given by the Board of Trustees of the Trust. The New Agreement contains
substantially the same terms and conditions, including the same investment
advisory fee, contained in the Current Agreement. The New Agreement will
commence on April 1, 1995 and, if approved by shareholders, will continue
initially for a two year period and would continue automatically for suc-
cessive annual periods thereafter; provided such continuance is approved
at least annually by: (a) a majority of the Board who are not interested
persons of the Trust (as the term is used in the Investment Company Act of
1940, as amended (the "1940 Act")) and (b) a majority of the full Board of
Trustees or a majority of the outstanding voting securities of the Portfo-
lio, as defined in the 1940 Act.
THE CURRENT INVESTMENT ADVISER
PanAgora Management, an adviser registered under the Investment Advisers
Act of 1940, as amended (the "Advisers Act"), presently acts as investment
adviser to the Portfolio. PanAgora Management, which is located at 25
Franklin Street, 22nd Floor, Boston, Massachusetts 02110, is 50% owned by
Nippon Life Insurance Company and 50% owned by Lehman Brothers, Inc. ("Le-
hman Brothers"), a wholly owned subsidiary of Lehman Brothers Holdings
Inc. Lehman Brothers Holdings Inc., in turn, is a publicly owned corpora-
tion of which Nippon Life Insurance Company owns approximately 11.2% of
the outstanding voting stock. PanAgora Management renders investment ad-
vice to institutional clients (including other investment companies) with
total assets under management, as of February 28, 1995 of $14.5 billion.
The Current Agreement, dated October 16, 1991, was last approved by share-
holders on December 17, 1992. Under the terms of the Current Agreement,
the Portfolio pays an investment advisory fee at an annual rate of 0.40%
of the average daily net assets of the Portfolio. During the fiscal year
ended December 31, 1994, the Portfolio paid PanAgora Management $29,051 in
investment advisory fees.
THE PROPOSED INVESTMENT ADVISER
TIMCO was founded over 25 years ago as an investment adviser responsible
for providing investment advice to investment companies and private ac-
counts. The investment professionals at TIMCO, which has been a registered
investment adviser since 1971, have extensive experience in developing and
managing equity portfolios with objectives similar to the Portfolio's ob-
jectives. Exhibit B to this Proxy Statement identifies investment compa-
nies that invest in equities for which TIMCO serves as investment adviser,
the fees charged by TIMCO and the size of each such investment company.
Under the terms of these various investment advisory agreements, TIMCO
provides portfolio advice and assistance with respect to the selection,
acquisition, holding and disposal of securities and receives compensation
based on direct and indirect costs it incurs in performing such services.
The name, position with TIMCO and principal occupation of each executive
officer and director of TIMCO are set forth in the following table. The
business address of TIMCO and each officer and director is One Tower
Square, Hartford, CT 06183-2030.
<TABLE>
<CAPTION>
NAME POSITION WITH TIMCO PRINCIPAL OCCUPATION
<S> <C> <C>
Kent A. Kelley Chief Executive Officer Chief Executive Officer
and Portfolio Manager
Sandip A. Bhagat President President and Portfolio
Manager
Jacob E. Hurwitz Vice President Portfolio Manager
Daniel B. Willey Vice President Head Trader
</TABLE>
EVALUATION BY THE BOARD AND REASONS FOR THE PROPOSAL
On January 25, 1995, the Trustees of the Trust met in person at a meeting
called for the purpose of considering, among other things, the New Agree-
ment with TIMCO. The Board also considered at that time the continuation
of the Portfolio's Current Agreement with PanAgora Management and various
other possible alternatives. The Board reviewed materials furnished by
TIMCO and information regarding PanAgora Management. The written material
described, among other matters, each of TIMCO and PanAgora Management and
their affiliates, senior personnel, portfolio managers, analysts, econo-
mists and others, their methods of operations, investment philosophies,
performance records and financial conditions. Representatives of TIMCO met
with the Board to discuss in depth the written materials and to respond to
questions from the Board and its independent counsel. The Board reviewed
and considered PanAgora Management's investment performance on behalf of
the Portfolio and the past investment performance of TIMCO in managing
portfolios of funds with objectives and policies similar to those of the
Portfolio.
The Board of Trustees of the Trust determined to terminate the Portfolio's
Current Agreement with PanAgora Management and to enter into the New
Agreement with TIMCO subject to the approval of shareholders. In so doing,
a variety of factors were evaluated. The Board considered the fact that at
the time of the Portfolio's inception, PanAgora Management had been an in-
tegral part of the asset management structure of Shearson Lehman Brothers,
Inc. ("Shearson Lehman") and that this relationship was fundamentally al-
tered upon the separation of Lehman Brothers (which owns 50% of PanAgora
Management) from Shearson Lehman in July, 1993, when the latter's assets
were acquired by Smith Barney. Prior to that time, Heath B. McLendon, the
Trust's chief executive officer, was in close contact with the Portfolio's
management team and, as an officer of Shearson Lehman, was able to provide
considerable oversight of the adviser's activities. Lehman Brothers, how-
ever, is now a completely separate company and Mr. McLendon no longer has
unrestricted access to PanAgora Management. The Board noted that this
would not be the case, however, if TIMCO were appointed investment adviser
of the Portfolio as TIMCO is a wholly owned subsidiary of Holdings, the
parent company of Smith Barney, of which Mr. McLendon is a managing direc-
tor.
The Board also took note that prior to July 1993, the Portfolio's distrib-
utor (Shearson Lehman) and the Portfolio's investment adviser were affili-
ated. Today, the Portfolio's distributor and administrator are no longer
affiliated with its investment adviser. The Board considered whether
TIMCO, as the Portfolio's investment adviser, could facilitate the Portfo-
lio's integration with the other components of the Smith Barney Group of
Funds and thereby better enhance the support and services received by the
Portfolio's shareholders.
The Board also acknowledged that Lehman Brothers and its affiliates are
currently advising and sponsoring a series of mutual funds that are being
offered, and will continue to be offered, to retail and other investors
through its own distribution network. In this regard, it was noted that
the availability of Lehman-sponsored funds could be confusing to investors
in the Portfolio and other mutual funds sponsored by Smith Barney.
The Board reviewed the past performance records of PanAgora Management and
TIMCO over relevant periods of time as well as the background and experi-
ence of the various officers and managers employed by those companies. The
Board noted that TIMCO had been involved in the management of over ten
different index funds since 1985. The Board also compared the past perfor-
mance of TIMCO and PanAgora Management and evaluated those records against
various indices and industry standards. The Board was satisfied that both
PanAgora Management and TIMCO could provide high quality advisory and man-
agement services to the Portfolio.
After carefully evaluating the foregoing material and factors, and after
meeting in executive session with independent counsel, the Trustees of the
Trust who were not interested persons of the Trust approved, subject to
shareholder approval, the New Agreement with TIMCO containing substan-
tially identical terms and conditions as the Current Agreement, and recom-
mended its approval by the Portfolio's shareholders.
PORTFOLIO TRANSACTIONS
Decisions to buy and sell securities for the Portfolio are made by its in-
vestment adviser (collectively referring to both PanAgora Management and
TIMCO), subject to the overall review of the Board. Although investment
decisions for the Portfolio are made independently from those of other ac-
counts managed by the investment adviser, investments of the type the
Portfolio may make also may be made by those other accounts. When the
Portfolio and one or more other accounts managed by the investment adviser
are prepared to invest in, or desire to dispose of, the same security,
available investments or opportunities for sales will be allocated to
each. In some cases, this procedure may adversely affect the price paid or
received by the Portfolio or the size of the position obtained or disposed
of by the Portfolio.
Transactions on many stock exchanges involve the payment of negotiated
brokerage commissions. On exchanges where commissions are negotiated, the
cost of transactions may vary among different brokers. The cost of securi-
ties purchased from underwriters include an underwriting commission or
concession and the prices at which securities are repurchased from and
sold to dealers include a dealer's mark-up or mark-down.
In selecting brokers or dealers to execute portfolio transactions on be-
half of the Portfolio, the investment adviser seeks the best overall terms
available. In assessing the best overall terms available for any transac-
tions, the investment adviser will consider factors it deems relevant, in-
cluding the breadth of the market in the security, the price of the secu-
rity, the financial condition and execution capability of the broker or
dealer and the reasonableness of the commission, if any, for the specific
transaction and on a continuing basis. In addition, the investment adviser
is authorized, in selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, to con-
sider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities and Exchange Act of 1934) provided to the
Portfolio and/or other accounts over which the investment adviser or its
affiliates exercise investment discretion. The fees under the Portfolio's
investment advisory agreement are not reduced by reason of the Portfolio's
or investment adviser's receiving brokerage and research services. Re-
search and investment services are those which brokerage houses customar-
ily provide to institutional investors and include statistical and eco-
nomic data and research reports on particular issues and industries. These
services are used by the investment adviser in connection with all of its
investment activities, and some of the services obtained in connection
with the execution of transactions for the Portfolio may be used in manag-
ing other investment accounts. Conversely, brokers furnishing these ser-
vices may be selected for the execution of transactions for these other
accounts, whose aggregate assets may exceed those of the Portfolio, and
the services furnished by the brokers may be used by the investment ad-
viser in providing investments for the Portfolio. The Board of Trustees
periodically reviews the commissions paid by the Portfolio to determine if
the commissions paid over representative periods of time were reasonable
in relation to the benefits inuring to the Portfolio.
To the extent consistent with applicable provisions of the 1940 Act and
the rules and exemptions adopted by the Securities and Exchange Commission
(the "SEC") thereunder, the Board has determined that transactions for the
Portfolio may be executed through Smith Barney (an affiliate of the admin-
istrator and distributor for the Portfolio) and other affiliated broker-
dealers if, in the judgment of the Portfolio's investment adviser, the use
of an affiliated broker-dealer is likely to result in price and execution
at least as favorable as those of other qualified broker-dealers.
The Board periodically reviews the commissions paid by the Trust to deter-
mine if the commissions paid over representative periods of time were rea-
sonable in relation to the benefits inuring to the Trust. During the fis-
cal year ended December 31, 1994, the Trust incurred total brokerage com-
missions on portfolio transactions in respect of the Portfolio of
$455,841, of which $18,774 or 4.11% was paid to Smith Barney.
The Portfolio will not purchase any security during the existence of any
underwriting or selling group relating to the security of which Smith Bar-
ney is a member, except to the extent permitted by the SEC.
THE PROPOSED AGREEMENT
A copy of the form of the New Agreement is set forth as Exhibit A to this
Proxy Statement. Under its terms, TIMCO, subject to the supervision and
approval of the Portfolio's Board, would manage the Portfolio's invest-
ments in accordance with the investment objective and policies stated in
the Portfolio's Prospectus and Statement of Additional Information. As in-
vestment adviser, TIMCO would be responsible for making investment deci-
sions concerning assets, supplying investment research and portfolio man-
agement services and placing orders to purchase and sell assets on behalf
of the Portfolio. TIMCO would receive a fee that is computed daily and
paid monthly at the annual rate of 0.40% of the value of the Portfolio's
average daily net assets. WITH THE EXCEPTION OF THE IDENTITY OF THE IN-
VESTMENT ADVISER AND THE COMMENCEMENT AND TERMINATION DATES, THE PROVI-
SIONS OF THE NEW AGREEMENT AND THE CURRENT AGREEMENT WITH PANAGORA MANAGE-
MENT ARE VIRTUALLY IDENTICAL.
Under the terms of the New Agreement, TIMCO bears all expenses in connec-
tion with its performance. Other expenses incurred in the operation of the
Portfolio will continue to be borne by the Portfolio, including: taxes,
interest, brokerage fees and commissions, if any; distribution and share-
holder service fees; fees of the Board members who are not officers, di-
rectors; blue sky qualification fees; charges of custodian and transfer
and dividend disbursing agents; certain insurance premiums; outside audit-
ing and legal expenses; costs of investor services (including allocable
telephone and personnel expenses); costs of preparation and printing of
prospectuses and statements of additional information for regulatory pur-
poses and for distribution to shareholders; costs of preparation and
printing of shareholders' reports; costs incurred in connection with meet-
ings of the shareholders of the Portfolio and of the officers of the Port-
folio or Board and any extraordinary expenses.
If, in any fiscal year, the aggregate expenses of the Portfolio (including
fees pursuant to the Portfolio's investment advisory and administration
agreements but excluding distribution and shareholder services fees, in-
terest, taxes, brokerage, and, if permitted by state securities commis-
sions, extraordinary expenses) exceed the expense limitation of any state
having jurisdiction over the Portfolio, TIMCO will reduce its fee to the
Portfolio for such excess expense to the extent required by state law in
the same proportion as its fee bears to the Portfolio's aggregate fees for
investment advice and administration. This expense reimbursement, if any,
will be estimated, reconciled and paid on a monthly basis.
The New Agreement provides that in the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard for its obligations thereun-
der, TIMCO shall not be liable for any act or omission in the course of or
in connection with the rendering of its services thereunder.
REQUIRED VOTE
Approval of the New Agreement requires the affirmative vote of a "majority
of the outstanding voting securities" of the Portfolio. The term "majority
of the outstanding voting securities" of the Portfolio, as defined in the
1940 Act, means an affirmative vote of the lesser of: (a) 67% of the vot-
ing securities of the Portfolio present at the Special Meeting if more
than 50% of the outstanding shares are present in person or by proxy at
the Special Meeting; and (b) more than 50% of the outstanding voting secu-
rities of the Portfolio.
If the New Agreement is not approved by the shareholders of the Portfolio,
TIMCO will continue to serve as investment adviser to the Portfolio for a
period of time pending approval of such agreement or a different invest-
ment advisory agreement or other definitive action by shareholders, pro-
vided that the compensation received by TIMCO during that period is not
greater than the amount that would have been received under the Portfo-
lio's Current Agreement with PanAgora Management.
SUBMISSION OF SHAREHOLDER PROPOSALS
The Portfolio is not generally required to hold annual or special meetings
of the shareholders. Shareholders wishing to submit proposals for inclu-
sion in a proxy statement for a subsequent shareholders' meeting should
send their written proposals to the Secretary of the Portfolio c/o Smith
Barney Mutual Funds Management Inc., 388 Greenwich Street, 22nd Floor, New
York, New York 10013.
SHAREHOLDERS' REQUEST FOR SPECIAL MEETING
Shareholders holding at least 10% of the Portfolio's outstanding voting
securities (as defined in the 1940 Act) may require the calling of a meet-
ing of the Portfolio's shareholders for the purpose of voting on the re-
moval of any Board member. Meetings of the Portfolio's shareholders for
any other purpose will also be called by the Board when requested in writ-
ing by shareholders holding at least 10% of the shares then outstanding
or, if the Board members shall fail to call or give notice of any meeting
of shareholders for a period of 30 days after such application, sharehold-
ers holding at least 10% of the shares then outstanding may give notice of
such meeting.
OTHER MATTERS TO COME BEFORE THE MEETING
The Board does not intend to present any other business at the Special
Meeting other than as described in this Proxy Statement, nor is the Board
aware that any shareholder intends to do so. If, however, any other mat-
ters are properly brought before the Special Meeting, the persons named in
the accompanying proxy card will vote thereon in accordance with their
judgment.
March 30, 1995
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN, DATE
AND RETURN THE PROXY AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE PAID EN-
VELOPE.
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
SMITH BARNEY SERIES FUND
(EQUITY INDEX PORTFOLIO)
April 1, 1995
Travelers Investment Management Company
One Tower Square
Hartford, CT 06183-2030
DEAR SIRS:
Smith Barney Series Fund (the "Company"), a trust organized under the laws
of the Commonwealth of Massachusetts, confirms its agreement with the
Travelers Investment Management Company (the "Adviser") as follows:
1. Investment Description; Appointment
The Company desires to employ its capital by investing and reinvesting in
investments of the kind and in accordance with the investment objec-
tive(s), policies and limitations specified in its Master Trust Agreement,
as amended from time to time (the "Master Trust Agreement"), the prospec-
tus (the "Prospectus") and the statement of additional information (the
"Statement") filed with the Securities and Exchange Commission as part of
the Company's Registration Statement on Form N-1A, as amended from time to
time, and in the manner and to the extent as may from time to time be ap-
proved by the Board of Trustees of the Company (the "Board"). Copies of
the Prospectus, the Statement and the Master Trust Agreement have been or
will be submitted to the Adviser. The Company agrees to provide copies of
all amendments to the Prospectus, the Statement and the Master Trust
Agreement to the Adviser on an on-going basis. The Company desires to em-
ploy and hereby appoints the Adviser to act as the investment adviser to
the Equity Index Portfolio (the "Portfolio"). The Adviser accepts the ap-
pointment and agrees to furnish the services for the compensation set
forth below.
2. Services as Investment Adviser
Subject to the supervision, direction and approval of the Board of the
Company, the Adviser will: (a) manage the Company's holdings in accordance
with the Portfolio's investment objective(s) and policies as stated in the
Master Trust Agreement, the Prospectus and the Statement; (b) make invest-
ment decisions for the Portfolio; (c) place purchase and sale orders for
portfolio transactions for the Portfolio; and (d) employ professional
portfolio managers and securities analysts who provide research services
to the Portfolio. In providing those services, the Adviser will conduct a
continual program of investment, evaluation and, if appropriate, sale and
reinvestment of the Portfolio's assets.
3. Brokerage
In selecting brokers or dealers to execute transactions on behalf of the
Portfolio, the Adviser will seek the best overall terms available. In as-
sessing the best overall terms available for any transaction, the Adviser
will consider factors it deems relevant, including, but not limited to,
the breadth of the market in the security, the price of the security, the
financial condition and execution capability of the broker or dealer and
the reasonableness of the commission, if any, for the specific transaction
and on a continuing basis. In selecting brokers or dealers to execute a
particular transaction, and in evaluating the best overall terms avail-
able, the Adviser is authorized to consider the brokerage and research
services (as those terms are defined in Section 28(e) of the Securities
Exchange Act of 1934), provided to the Portfolio and/or other accounts
over which the Adviser or its affiliates exercise investment discretion.
4. Information Provided to the Company
The Adviser will keep the Company informed of developments materially af-
fecting the Portfolio's holdings, and will, on its own initiative, furnish
the Company from time to time with whatever information the Adviser be-
lieves is appropriate for this purpose.
5. Standard of Care
The Adviser shall exercise its best judgment in rendering the services
listed in Paragraphs 2 and 3 above. The Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the
Company in connection with the matters to which this Agreement relates,
provided that nothing in this Agreement shall be deemed to protect or pur-
port to protect the Adviser against any liability to the Company or to the
shareholders of the Portfolio to which the Adviser would otherwise be sub-
ject by reason of willful misfeasance, bad faith or gross negligence on
its part in the performance of its duties or by reason of the Adviser's
reckless disregard of its obligations and duties under this Agreement.
6. Compensation
In consideration of the services rendered pursuant to this Agreement, the
Company will pay the Adviser on the first business day of each month a fee
for the previous month at the annual rate of 0.40% of 1.00% of the Portfo-
lio's average daily net assets. The fee for the period from the Effective
Date (defined below) of the Agreement to the end of the month during which
the Effective Date occurs shall be prorated according to the proportion
that such period bears to the full monthly period. Upon any termination of
this Agreement before the end of a month, the fee for such part of that
month shall be prorated according to the proportion that such period bears
to the full monthly period and shall be payable upon the date of termina-
tion of this Agreement. For the purpose of determining fees payable to the
Adviser, the value of the Portfolio's net assets shall be computed at the
times and in the manner specified in the Prospectus and/or Statement.
7. Expenses
The Adviser will bear all expenses in connection with the performance of
its services under this Agreement. The Company will bear certain other ex-
penses to be incurred in its operation, including, but not limited to: in-
vestment advisory and administration fees; fees for necessary professional
and brokerage services; fees for any pricing service; the costs of regula-
tory compliance; and costs associated with maintaining the Company's legal
existence and shareholder relations.
8. Reduction of Fee
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement and the Portfolio's administration agree-
ment, but excluding interest, taxes, brokerage and extraordinary expenses)
exceed the expense limitation of any state having jurisdiction over the
Portfolio, the Adviser will reduce its fee to the Portfolio by the propor-
tion of such excess expense equal to the proportion that its fee thereun-
der bears to the aggregate of fees paid by the Portfolio for investment
advice and administration in that year, to the extent required by state
law. A fee reduction pursuant to this Paragraph 8, if any, will be esti-
mated, reconciled and paid on a monthly basis.
9. Services to Other Companies or Accounts
The Company understands that the Adviser now acts, will continue to act
and may act in the future as investment adviser to fiduciary and other
managed accounts, and as investment adviser to other investment companies,
and the Company has no objection to the Adviser's so acting, provided that
whenever the Portfolio and one or more other investment companies advised
by the Adviser have available funds for investment, investments suitable
and appropriate for each will be allocated in accordance with a formula
believed to be equitable to each company. The Portfolio recognizes that in
some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Portfolio understands that
the persons employed by the Adviser to assist in the performance of the
Adviser's duties under this Agreement will not devote their full time to
such service and nothing contained in this Agreement shall be deemed to
limit or restrict the right of the Adviser or any affiliate of the Adviser
to engage in and devote time and attention to other businesses or to ren-
der services of whatever kind or nature.
10. Term of Agreement
This Agreement shall become effective as of the date first written above
and shall continue for an initial two-year term and shall continue there-
after so long as such continuance is specifically approved at least annu-
ally by (i) the Board of the Company or (ii) a vote of a "majority" (as
that term is defined in the Investment Company Act of 1940, as amended
(the "1940 Act")) of the Portfolio's outstanding voting securities, pro-
vided that in either event the continuance is also approved by a majority
of the Board who are not "interested persons" (as defined in the 1940 Act)
of any party to this Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval. This Agreement is terminable,
without penalty, on 60 days' written notice, by the Board of the Company
or by vote of holders of a majority of the Portfolio's shares, or upon 90
days' written notice, by the Adviser. This Agreement will also terminate
automatically in the event of its assignment (as defined in the 1940 Act
and the rules thereunder).
11. Representation by the Company
The Company represents that a copy of the Master Trust Agreement is on
file with the Secretary of the Commonwealth of Massachusetts.
12. Limitation of Liability
The Company and the Adviser agree that the obligations of the Company
under this Agreement shall not be binding upon any of the members of the
Board, shareholders, nominees, officers, employees or agents, whether
past, present or future, of the Company, individually, but are binding
only upon the assets and property of the Company, as provided in the Mas-
ter Trust Agreement. The execution and delivery of this Agreement have
been authorized by the Board and a majority of the holders of the Portfo-
lio's outstanding voting securities, and signed by an authorized officer
of the Company, acting as such, and neither such authorization by such
members of the Board and shareholders nor such execution and delivery by
such officer shall be deemed to have been made by any of them individually
or to impose any liability on any of them personally, but shall bind only
the assets and property of the Company as provided in the Master Trust
Agreement.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance of this Agreement by signing and returning the enclosed
copy of this Agreement.
Very truly yours,
SMITH BARNEY SERIES FUND
By:
Name: Heath B. McLendon
Title: Chairman of the Board and
Chief Executive Officer
Accepted:
Travelers Investment Management Company
By:
Name:
Title:
EXHIBIT B
TIMCO-ADVISED INVESTMENT COMPANIES
INVESTING IN EQUITY SECURITIES
<TABLE>
<CAPTION>
ADVISORY FEE SCHEDULE
ASSETS AS
INVESTMENT COMPANY OF 2/28/95 FROM TO FEE
<S> <C> <C> <C> <C>
The Travelers Growth and
Income Stock Account
for
Variable Annuities $339,384,909 0.45 %
The Travelers Timed
Growth and Income Stock
Account for Variable
Annuities $309,404,904 0.3233%
The Travelers Capital
Appreciation Fund $ 81,741,073 0.20 %
The Travelers Managed
Asset Trust $ 87,007,655 0.50 %
The Travelers Series
Trust- Social Awareness $ 4,408,004 $ 0 $ 50,000,000
Stock Portfolio 50,000,001 100,000,000 0.65 %
100,000,001 200,000,000 0.55 %
200,000,001 and over 0.45 %
0.40 %
The Travelers Timed Ag- 0.50 %
gressive Stock Account $ 44,139,726 $ 0 $ 20,000,000 0.25 %
for Variable Annuities 20,000,001 100,000,000 0.20 %
100,000,001 300,000,000 0.15 %
300,000,001 and over
</TABLE>
VOTE THIS VOTING INSTRUCTION CARD TODAY
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
(Please Detach at Perforation Before Mailing)
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SMITH BARNEY SERIES FUND
ON BEHALF OF EQUITY INDEX PORTFOLIO
PROXY SOLICITED BY THE BOARD OF TRUSTEES
The undersigned holder of shares of Equity Index Portfolio (the
"Portolio"), a sub-trust of Smith Barney Series Fund (the "Trust"), hereby
appoints Heath B. McLendon, Christina T. Sydor and Caren Cunningham,
attorneys and proxies for the undersigned with full powers of substitution
and revocation, to represent the undersigned and to vote on behalf of the
undersigned all shares of the Treasury Fund that the undersigned is
entitled to vote at the Special Meeting of Shareholders of the Portfolio to
be held at the offices of the Trust, 388 Greenwich Street, 26th Floor, New
York, New York on April 27, 1995 at 3:00 p.m. and any adjournment or
adjournments thereof. The undersigned hereby acknowledges receipt of the
Notice of Special Meeting and Prospectus /Proxy Statement dated March [
], 1995 and hereby instructs said attorneys and proxies to vote said shares
as indicated herein. In their discretion, the proxies are authorized to
vote upon such other business as may properly come before the Special
Meeting. A majority of the proxies present and acting at the Special
Meeting in person or by substitute (or, if only one shall be so present,
then that one) shall have and may exercise all of the power and authority
of said proxies hereunder. The undersigned hereby revokes any proxy
previously given.
PLEASE SIGN, DATE AND RETURN
PROMPTLY IN THE ENCLOSED ENVELOPE
Note: Please sign exactly as your name appears on this Proxy.
If joint owners, EITHER may sign this Proxy. When signing as attorney,
executor,
administrator, trustee, guardian or corporate officer, please give your
full title.
Date:
Signature(s)
________________________________________
(Title(s), if applicable)
VOTE THIS VOTING INSTRUCTION CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
(Please Detach at Perforation Before Mailing)
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Please indicate your vote by an "X" in the appropriate box below. This
proxy, if properly executed, will be voted in the manner directed by the
undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE PROPOSAL.
1. To approve or disapprove a new investment advisory agreement
between Smith Barney Series Fund, on behalf of its Equity Index
Portfolio (the "Portfolio"), and Travelers Investment Management
Company, a wholly owned subsidiary of Smith Barney Holding, Inc., the
parent company of the administrator and distributor for Smith Barney
Series Fund, containing subtantially the same terms and conditions,
including the same level of fees, as the Portfolio's current
investment advisory agreement.
FOR
AGAINST
ABSTAIN
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