File No. 33-44186
811-6485
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
- --------------------------------------------------------------------------------
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |X|
Pre-Effective Amendment No. __ |_|
Post-Effective Amendment No. 29 |X|
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 |X|
Amendment No. 31 |X|
- --------------------------------------------------------------------------------
SELIGMAN GLOBAL FUND SERIES, INC.
(Exact name of registrant as specified in charter)
- --------------------------------------------------------------------------------
100 PARK AVENUE, NEW YORK, NEW YORK 10017
(Address of principal executive office)
- --------------------------------------------------------------------------------
Registrant's Telephone Number: 212-850-1864 or
Toll Free: 800-221-2450
- --------------------------------------------------------------------------------
THOMAS G. ROSE, Treasurer
100 Park Avenue
New York, New York 10017
(Name and address of agent for service)
- --------------------------------------------------------------------------------
It is proposed that this filing will become effective (check
appropriate box):
|_| immediately upon filing pursuant |_| on (date) pursuant to paragraph
to paragraph (b) (a)(1)
|X| on February 28, 2000 pursuant to |_| 75 days after filing pursuant to
paragraph (b) paragraph (a)(2)
|_| 60 days after filing pursuant to |_| on (date) pursuant to paragraph
paragraph (a)(1) (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>
SELIGMAN
-------------------
GLOBAL FUND
SERIES, INC.
EMERGING
MARKETS FUND
GLOBAL GROWTH FUND
GLOBAL SMALLER
COMPANIES FUND
GLOBAL TECHNOLOGY FUND
INTERNATIONAL
GROWTH FUND
[GRAPHIC]
PROSPECTUS
MARCH 1, 2000
----------
Investing
Around the World
for Capital
Appreciation
The Securities and Exchange Commission has neither approved nor disapproved
these Funds, and it has not determined the prospectus to be accurate or
adequate. Any representation to the contrary is a criminal offense.
An investment in these Funds or any other fund cannot provide a complete
investment program. The suitability of an investment in a Fund should be
evaluated based on the investment objective, strategies and risks described in
this Prospectus, considered in light of all of the other investments in your
portfolio, as well as your risk tolerance, financial goals, and time horizons.
We recommend that you consult your financial advisor to determine if one or more
of these Funds is suitable for you.
managed by
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
EQSGFS1 3/2000
<PAGE>
Table of Contents
This prospectus contains information about Seligman Global Fund Series, Inc.,
which consists of five separate funds.
The Funds
A discussion of the investment strategies, risks, performance and expenses of
the Funds.
Seligman Emerging Markets Fund 2
Seligman Global Growth Fund 6
Seligman Global Smaller Companies Fund 10
Seligman Global Technology Fund 14
Seligman International Growth Fund 18
Management of the Funds 22
Shareholder Information
Deciding Which Class of Shares to Buy 25
Pricing of Fund Shares 27
Opening Your Account 27
How to Buy Additional Shares 28
How to Exchange Shares Among
the Seligman Mutual Funds 29
How to Sell Shares 29
Important Policies That May Affect Your Account 30
Dividends and Capital Gain Distributions 31
Taxes 31
The Seligman Mutual Funds 32
Financial Highlights 34
How to Contact Us 40
For More Information back cover
TIMES CHANGE ... VALUES ENDURE
<PAGE>
The Funds
SELIGMAN EMERGING MARKETS FUND
INVESTMENT OBJECTIVE
The Emerging Markets Fund's investment objective is long-term capital
appreciation.
- --------------------------------------------------------------------------------
Emerging Market:
A market in a developing country. Developing countries are those classified by
the World Bank as low-income or middle-income economies, regardless of their
particular stage of development. Low-income and middle-income economies are
currently defined as those with 1998 per capita Gross National Product (GNP) of
US $9,360 or less.
- --------------------------------------------------------------------------------
PRINCIPAL INVESTMENT STRATEGIES
The Fund uses the following principal investment strategies to seek its
investment objective:
The Fund generally invests at least 65% of its assets in equity securities of
companies that conduct their principal business activities in emerging markets.
The Fund will focus its investments in those developing countries in which the
investment manager believes the economies are developing strongly and markets
are becoming more liquid. The Fund seeks to benefit from policies of economic
development being adopted in many developing countries. These policies include
domestic price reform, reducing internal budget deficits, privatization,
encouraging foreign investments, and developing capital markets.
The Fund combines a bottom-up investment style with top-down analysis of
regions, countries and sectors. This means the investment manager concentrates
first on analysis of individual companies then on analysis of individual
sectors, countries and regions.
In selecting individual securities, the investment manager looks to identify
companies that it believes display one or more of the following:
o Operate in growing markets
o Attractive valuations relative to cash earnings forecasts or other
valuation criteria
o Unique sustainable competitive advantages (e.g., market share,
proprietary products)
o Market liquidity
o Catalyst's which, when recognized, may increase company valuation
Following stock selection, the manager then focuses on portfolio construction
which considers top-down risk control based on such factors as:
o Relative economic growth potential of the various economies and
securities markets
o Political, financial, and social conditions influencing investment
opportunities
o Investor sentiment
o Prevailing interest rates and expected levels of inflation
o Market prices relative to historic averages
The Fund generally sells a stock if the investment manager believes its target
price has been reached, its earnings are disappointing, its revenue growth has
slowed, or its underlying fundamentals have deteriorated. The Fund may also sell
or trim a stock if the investment manager believes, from a risk control
prospective, the stocks position size is inappropriate for the portfolio. Also
stocks may be sold when negative country, currency, or general industry factors
affect a company's outlook, or to meet cash requirements.
2
<PAGE>
The Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. The securities may be listed
on a US or foreign stock exchange or traded in US or foreign over-the-counter
markets. The Fund normally concentrates its investments in common stocks;
however, it may invest in other types of equity securities, including securities
convertible into or exchangeable for common stock, depositary receipts, and
rights and warrants to purchase common stock. The Fund also may invest up to 25%
of its assets in preferred stock and investment-grade or comparable quality debt
securities.
The Fund may invest up to 15% of its net assets in illiquid securities (i.e.,
securities that cannot be readily sold), and may from time to time enter into
forward foreign currency exchange contracts in an attempt to manage the risk of
adverse changes in currencies. The Fund may also purchase put options in an
attempt to hedge against a decline in the price of securities it holds in its
portfolio. A put option gives the Fund the right to sell an underlying security
at a particular price during a fixed period of time. Forward foreign currency
exchange contracts and put options on securities may not be available to the
Fund on reasonable terms in many situations, and the Fund may frequently choose
not to enter into such contracts or purchase such options even when they are
available.
The Fund may, from time to time, take temporary defensive positions that are
inconsistent with its principal strategies in seeking to minimize extreme
volatility caused by adverse market, economic, or other conditions. This could
prevent the Fund from achieving its objective.
The Fund may change its principal strategies if the Board of Directors believes
doing so is consistent with the Fund's objective. The Fund's objective may be
changed only with the approval of shareholders.
As with any mutual fund, there is no guarantee the Fund will achieve its
objective.
PRINCIPAL RISKS
The Fund's net asset value may fluctuate more than other equity funds or other
global equity funds that do not invest heavily in emerging markets. You may
experience a decline in the value of your investment and you could lose money
if you sell your shares at a price lower than you paid for them. Emerging
countries may have relatively unstable governments, economies based on less
diversified industrial bases, and securities markets that trade a smaller number
of securities. Companies in emerging markets are often smaller, less seasoned,
and more recently organized than many US companies.
Investing in securities of foreign issuers involves risks not associated with US
investments, including currency fluctuation, local withholding and other taxes,
different financial reporting practices and regulatory standards, high costs of
trading, changes in political conditions, expropriation, investment and
repatriation restrictions and settlement and custody risks. Investing in
emerging markets involves a greater degree of risk, and an investment in the
Fund should be considered speculative.
The Fund may be negatively affected by the broad investment environment in the
international or US securities markets, which is influenced by, among other
things, interest rates, inflation, politics, fiscal policy, and current events.
To the extent the Fund invests some of its assets in other higher-risk
securities, such as illiquid securities, it may be subject to higher price
volatility.
The Fund may actively and frequently trade securities in its portfolio to carry
out its principal strategies. A high portfolio turnover rate increases
transaction costs which may increase the Fund's expenses. Frequent and active
trading may also cause adverse tax consequences for investors in the Fund due to
an increase in short-term capital gains.
An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
3
<PAGE>
SELIGMAN EMERGING MARKETS FUND
PAST PERFORMANCE
The Fund offers four Classes of shares. The information below provides some
indication of the risks of investing in the Fund by showing how the performance
of Class A shares has varied year to year, as well as how the performance of
each Class compares to two widely-used measures of performance. Although the
Fund's fiscal year ends on October 31, the performance is provided on a calendar
year basis to assist you in comparing the returns of the Fund with the returns
of other mutual funds. How the Fund has performed in the past, however, is not
necessarily an indication of how the Fund will perform in the future. Total
returns will vary between each Class of shares due to the different fees and
expenses of each Class.
The Class A annual total returns presented in the bar chart do not reflect the
effect of any sales charges. If these charges were included, the returns would
be lower. The average annual total returns presented in the table below the
chart do reflect the effect of the applicable sales charges. Both the bar chart
and table assume that all dividends and capital gain distributions were
reinvested.
Class A Annual Total Returns - Calendar Years
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
1997 6.35%
1998 -27.45%
1999 60.69%
Best calendar quarter return: 33.99% - quarter ended 12/31/99.
Worst calendar quarter return: -25.67% - quarter ended 9/30/98.
- --------------------------------------------------------------------------------
Average Annual Total Returns - Periods Ended 12/31/99
<TABLE>
<CAPTION>
SINCE CLASS C
ONE INCEPTION SINCE INCEPTION
YEAR 5/28/96 5/27/99
------- ------------ -------------------
<S> <C> <C> <C>
Class A 53.14% 4.51% n/a
Class B 54.70 4.44 n/a
Class C n/a n/a 37.07%
Class D 58.40 5.17 n/a
MSCI EMF Index 66.41 5.90(1) 32.48(2)
Lipper Emerging Markets Funds Average 70.85 4.05(1) 42.02(2)
</TABLE>
The Morgan Stanley Capital International Emerging Markets Free Index
(MSCI EMF Index) and the Lipper Emerging Markets Funds Average are unmanaged
benchmarks that assume the reinvestment of dividends. The Lipper Emerging
Markets Funds Average excludes the effect of sales charges and the
MSCI EMF Index excludes the effect of fees and sales charges. The MSCI EMF Index
measures the performance of stocks in 26 emerging market countries in Europe,
Latin America, and the Pacific Basin which are available to foreign investors.
The Lipper Emerging Markets Funds Average measures the performance of mutual
funds which invest at least 65% of total assets in equity securities of
companies in emerging markets.
(1) From 5/31/96.
(2) From 5/31/99.
- --------------------------------------------------------------------------------
4
<PAGE>
FEES AND EXPENSES
The table below summarizes the fees and expenses that you may pay as a
shareholder of the Fund. Each Class of shares has its own sales charge schedule
and is subject to different ongoing 12b-1 fees. Shareholder fees are charged
directly to your account. Annual fund operating expenses are deducted from Fund
assets and are therefore paid indirectly by you and other shareholders of the
Fund.
<TABLE>
<CAPTION>
Shareholder Fees Class A Class B Class C Class D
- ----------------- ------ ------- ------- -------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) ......................................... 4.75% 5% 2% 1%
Maximum Sales Charge (Load) on Purchases
(as a% of offering price) ................................... 4.75%(1) none 1% none
Maximum Deferred Sales Charge (Load) (CDSC) on Redemptions
(as a% of original purchase price or current net asset value,
whichever is less) ........................................... none(1) 5% 1% 1%
Annual Fund Operating Expenses for Fiscal 1999
- ----------------------------------------------
(as a percentage of average net assets)
Management Fees ..................................................... 1.25% 1.25% 1.25% 1.25%
Distribution and/or Service (12b-1) Fees ............................ 0.25% 1.00% 1.00% 1.00%
Other Expenses ...................................................... 1.08% 1.08% 1.08% 1.08%
---- ---- ---- ----
Total Annual Fund Operating Expenses ................................ 2.58% 3.33% 3.33% 3.33%
==== ==== ==== ====
</TABLE>
(1) If you buy Class A shares for $1,000,000 or more, you do not pay an initial
sales charge, but your shares will be subject to a 1% CDSC if sold within
18 months.
Example
- -------
This example is intended to help you compare the expenses of investing in the
Fund with the expenses of investing in other mutual funds. It assumes (1) you
invest $10,000 in the Fund for each period and then sell all of your shares at
the end of that period, (2) your investment has a 5% return each year, and (3)
the Fund's operating expenses remain the same. Although your actual expenses may
be higher or lower, based on these assumptions your expenses would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 724 $1,239 $1,780 $3,251
Class B 836 1,324 1,936 3,452+
Class C 531 1,114 1,819 3,686
Class D 436 1,024 1,736 3,622
If you did not sell your shares at the end of each period, your expenses would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 724 $1,239 $1,780 $3,251
Class B 336 1,024 1,736 3,452+
Class C 432 1,114 1,819 3,686
Class D 336 1,024 1,736 3,622
+ Class B shares will automatically convert to Class A shares after eight
years.
5
<PAGE>
SELIGMAN GLOBAL GROWTH FUND
INVESTMENT OBJECTIVE
The Global Growth Fund's investment objective is long-term capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
The Fund uses the following principal investment strategies to seek its
investment objective:
The Fund invests primarily in equity securities of non-US and US growth
companies that have the potential to benefit from global economic or social
trends. The Fund may invest in companies of any size, domiciled in any country.
Typically, the Fund will invest in several countries in different geographic
regions.
The Fund uses an investment style that combines macro analysis of global trends
with in-depth research of individual companies. This means that the investment
manager analyzes the rapidly changing world to identify investment themes that
it believes will have the greatest impact on global markets, and use in-depth
research to identify attractive companies around the world. The Fund focuses on
the following macro trends:
o Economic liberalization and the flow of capital through global trade
and investment
o Globalization of the world's economy
o The expansion of technology as an increasingly important influence on
society
o Increased awareness of the importance of protecting the environment
o An increase in life expectancy leading to changes in consumer
demographics and a greater need for healthcare, personal security, and
leisure
In selecting individual securities, the investment manager looks to identify
companies that it believes display one or more of the following:
o Attractive valuations relative to earnings forecasts or other
valuation criteria (e.g., return on equity)
o Quality management and equity ownership by executives
o Unique competitive advantages (e.g., market share, proprietary
products)
o Potential for improvement in overall operations
The Fund generally sells a stock if the investment manager believes its target
price has been reached, its earnings are disappointing, its revenue growth has
slowed, or its underlying fundamentals have deteriorated. The Fund may also sell
a stock if the investment manager believes that negative country or regional
factors or a shifting in global trends may negatively affect a company's
outlook, or to meet cash requirements.
The Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. The Fund normally
concentrates its investments in common stocks; however, it may invest in other
types of equity securities, including securities convertible into or
exchangeable for common stock, depositary receipts, and rights and warrants to
purchase common stock. The Fund also may invest up to 25% of its assets in
preferred stock and investment-grade or comparable quality debt securities.
The Fund may invest up to 15% of its net assets in illiquid securities (i.e.,
securities that cannot be readily sold), and may from time to time enter into
forward foreign currency exchange contracts in an attempt to manage the risk of
adverse changes in currencies. The Fund may also purchase put options in an
attempt to hedge against a decline in the price of securities it holds in its
portfolio. A put option gives the Fund the right to sell an underlying security
at a particular price during a fixed period of time. Forward foreign currency
exchange contracts and put options on securities may not be
6
<PAGE>
available to the Fund on reasonable terms in many situations, and the Fund may
frequently choose not to enter into such contracts or purchase such options even
when they are available.
The Fund may, from time to time, take temporary defensive positions that are
inconsistent with its principal strategies in seeking to minimize extreme
volatility caused by adverse market, economic, or other conditions. This could
prevent the Fund from achieving its objective.
The Fund may change its principal strategies if the Board of Directors believes
doing so is consistent with the Fund's objective. The Fund's objective may be
changed only with the approval of shareholders.
As with any mutual fund, the Fund may not achieve its objective.
PRINCIPAL RISKS
Stock prices fluctuate. Therefore, as with any fund that invests in stocks, the
Fund's net asset value will fluctuate. You may experience a decline in the value
of your investment and you could lose money if you sell your shares at a price
lower than you paid for them.
Investing in securities of foreign issuers involves risks not associated with US
investments, including currency fluctuation, local withholding and other taxes,
different financial reporting practices and regulatory standards, high costs of
trading, changes in political conditions, expropriation, investment and
repatriation restrictions and settlement and custody risks.
The Fund seeks to limit the risk of investing in foreign securities by
diversifying its investments among different countries, as well as among
different themes. Diversification reduces the effect events in any one country
will have on the Fund's entire investment portfolio. However, a decline in the
value of the Fund's investments in one country may offset potential gains from
investments in another country.
If global trends do not develop as the manager expects, the Fund's performance
could be negatively affected.
The Fund may be negatively affected by the broad investment environment in the
international or US securities markets, which is influenced by, among other
things, interest rates, inflation, politics, fiscal policy, and current events.
To the extent the Fund invests some of its assets in higher-risk securities,
such as illiquid securities, it may be subject to higher price volatility.
The Fund may actively and frequently trade securities in its portfolio to carry
out its principal strategies. A high portfolio turnover rate increases
transaction costs which may increase the Fund's expenses. Frequent and active
trading may also cause adverse tax consequences for investors in the Fund due to
an increase in short-term capital gains.
An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
7
<PAGE>
SELIGMAN GLOBAL GROWTH FUND
PAST PERFORMANCE
The Fund offers four Classes of shares. The information below provides some
indication of the risks of investing in the Fund by showing how the performance
of Class A shares has varied year to year, as well as how the performance of
each Class compares to two widely-used measures of performance. Although the
Fund's fiscal year ends on October 31, the performance is provided on a calendar
year basis to assist you in comparing the returns of the Fund with the returns
of other mutual funds. How the Fund has performed in the past, however, is not
necessarily an indication of how the Fund will perform in the future. Total
returns will vary between each Class of shares due to the different fees and
expenses of each Class.
The Class A annual total returns presented in the bar chart do not reflect the
effect of any sales charges. If these charges were included, the returns would
be lower. The average annual total returns presented in the table below the
chart do reflect the effect of the applicable sales charges. Both the bar chart
and table assume that all dividends and capital gain distributions were
reinvested.
Class A Annual Total Returns - Calendar Years
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
1996 13.01%
1997 11.52%
1998 22.75%
1999 42.80%
Best calendar quarter return: 24.43% - quarter ended 12/31/99.
Worst calendar quarter return: -14.62% - quarter ended 9/30/98.
- --------------------------------------------------------------------------------
Average Annual Total Returns - Periods Ended 12/31/99
<TABLE>
<CAPTION>
CLASS A AND D CLASS B CLASS C
ONE SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION
YEAR 11/1/95 4/22/96 5/27/99
------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Class A 36.06% 20.48% n/a n/a
Class B 36.71 n/a 19.55% n/a
Class C n/a n/a n/a 34.82%
Class D 40.81 21.00 n/a n/a
MSCI World Index 25.34 20.94(1) 19.80(2) 20.71(3)
Lipper Global Funds Average 34.52 20.08(1) 18.93(2) 28.73(3)
</TABLE>
The Morgan Stanley Capital International World Index (MSCI World Index) and the
Lipper Global Funds Average are unmanaged benchmarks that assume reinvestment of
dividends. The Lipper Global Funds Average excludes the effect of sales charges
and the MSCI World Index excludes the effect of fees and sales charges. The MSCI
World Index measures the performance of stocks in 22 developed markets in North
America, Europe, and the Asia/Pacific region. The Lipper Global Funds Average
measures the performance of mutual funds which invest at least 25% of total
assets in equity securities traded outside the US, and which may own US
securities.
(1) From 10/31/95.
(2) From 4/30/96.
(3) From 5/31/99.
- --------------------------------------------------------------------------------
8
<PAGE>
FEES AND EXPENSES
The table below summarizes the fees and expenses that you may pay as a
shareholder of the Fund. Each Class of shares has its own sales charge schedule
and is subject to different ongoing 12b-1 fees. Shareholder fees are charged
directly to your account. Annual fund operating expenses are deducted from Fund
assets and are therefore paid indirectly by you and other shareholders of the
Fund.
<TABLE>
<CAPTION>
Shareholder Fees Class A Class B Class C Class D
- ---------------- ------- ------- ------- -------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) ....................................... 4.75% 5% 2% 1%
Maximum Sales Charge (Load) on Purchases
(as a% of offering price) ..................................... 4.75%(1) none 1% none
Maximum Deferred Sales Charge (Load) (CDSC) on Redemptions
(as a% of original purchase price or current net asset value,
whichever is less) ........................................... none(1) 5% 1% 1%
Annual Fund Operating Expenses for Fiscal 1999
- ----------------------------------------------
(as a percentage of average net assets)
Management Fees ................................................... 1.00% 1.00% 1.00% 1.00%
Distribution and/or Service (12b-1) Fees .......................... 0.25% 1.00% 1.00% 1.00%
Other Expenses .................................................... 0.44% 0.44% 0.44% 0.44%
------- ------- ------- -------
Total Annual Fund Operating Expenses .............................. 1.69% 2.44% 2.44% 2.44%
======= ======= ======= =======
</TABLE>
(1) If you buy Class A shares for $1,000,000 or more, you do not pay an initial
sales charge, but your shares will be subject to a 1% CDSC if sold within
18 months.
Example
- -------
This example is intended to help you compare the expenses of investing in the
Fund with the expenses of investing in other mutual funds. It assumes (1) you
invest $10,000 in the Fund for each period and then sell all of your shares at
the end of that period, (2) your investment has a 5% return each year, and (3)
the Fund's operating expenses remain the same. Although your actual expenses may
be higher or lower, based on these assumptions your expenses would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 639 $ 982 $1,349 $2,378
Class B 747 1,061 1,501 2,591+
Class C 444 853 1,388 2,848
Class D 347 761 1,301 2,776
If you did not sell your shares at the end of each period, your expenses would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 639 $ 982 $1,349 $2,378
Class B 247 761 1,301 2,591+
Class C 345 853 1,388 2,848
Class D 247 761 1,301 2,776
+ Class B shares will automatically convert to Class A shares after eight
years.
9
<PAGE>
SELIGMAN GLOBAL SMALLER COMPANIES FUND
INVESTMENT OBJECTIVE
The Global Smaller Companies Fund's investment objective is long-term capital
appreciation.
- --------------------------------------------------------------------------------
Smaller companies:
Companies with market capitalization (at the time of purchase by the Fund)
equivalent to US $1 billion or less.
- --------------------------------------------------------------------------------
PRINCIPAL INVESTMENT STRATEGIES
The Fund uses the following principal investment strategies to seek its
investment objective:
The Fund generally invests at least 65% of its assets in equity securities of
smaller US and non-US companies. The Fund may invest in companies domiciled in
any country, although it typically invests in developed countries. The Fund will
generally invest in several countries in different geographic regions.
The Fund uses an investment style that combines top-down macro-economic analysis
with bottom-up fundamental research into individual company attractiveness. This
means that the investment managers look to identify countries that they believe
offer good investment opportunities, and use extensive in-depth research to
identify attractive smaller companies around the world. The investment managers
look at one or more of the following factors when making country allocation
decisions:
o Relative economic growth potential of the various economies and
securities markets
o Political, financial, and social conditions influencing investment
opportunities
o Investor sentiment
o Prevailing interest rates and expected levels of inflation
o Market prices relative to historic averages
In selecting individual securities, the investment managers look for companies
that they believe display one or more of the following:
o Attractive valuations relative to earnings forecasts or other
valuation criteria (e.g., return on equity)
o Quality management and equity ownership by executives
o Unique competitive advantages (e.g., market share, proprietary
products)
o Market liquidity
o Potential for improvement in overall operations
The Fund generally sells a stock if the investment managers believe its target
price has been reached, its earnings are disappointing, its revenue growth has
slowed, or its underlying fundamentals have deteriorated. The Fund may also sell
a stock if the investment managers believe that negative country or regional
factors may affect a company's outlook, or to meet cash requirements. The Fund
anticipates that it will continue to hold securities of companies that grow or
expand so long as the investment managers believe the securities continue to
offer prospects of long-term growth.
The Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. The Fund normally
concentrates its investments in common stocks; however, it may invest in other
types of equity securities, including securities convertible into or
exchangeable for common stock, depositary receipts, and rights and warrants to
purchase common stock. The Fund also may invest up to 25% of its assets in
preferred stock and investment-grade or comparable quality debt securities.
The Fund may invest up to 15% of its net assets in illiquid securities (i.e.,
securities that cannot be readily sold), and may from time to time enter into
forward foreign currency exchange contracts in an attempt to manage the risk of
adverse
10
<PAGE>
changes in currencies. The Fund may also purchase put options in an attempt to
hedge against a decline in the price of securities it holds in its portfolio. A
put option gives the Fund the right to sell an underlying security at a
particular price during a fixed period of time. Forward foreign currency
exchange contracts and put options on securities may not be available to the
Fund on reasonable terms in many situations and the Fund may frequently choose
not to enter into such contracts or purchase such options even when they are
available.
The Fund may, from time to time, take temporary defensive positions that are
inconsistent with its principal strategies in seeking to minimize extreme
volatility caused by adverse market, economic, or other conditions. This could
prevent the Fund from achieving its objective.
The Fund may change its principal strategies if the Board of Directors believes
doing so is consistent with the Fund's objective. The Board of Directors may
change the definition of "smaller companies" if it concludes that such a change
is appropriate. The Fund's objective may be changed only with the approval of
shareholders.
As with any mutual fund, there is no guarantee the Fund will achieve its
objective.
PRINCIPAL RISKS
Stock prices fluctuate. Therefore, as with any fund that invests in stocks, the
Fund's net asset value will fluctuate. You may experience a decline in the value
of your investment and you could lose money if you sell your shares at a price
lower than you paid for them.
Investing in securities of foreign issuers involves risks not associated with US
investments, including currency fluctuation, local withholding and other taxes,
different financial reporting practices and regulatory standards, high costs of
trading, changes in political conditions, expropriation, investment and
repatriation restrictions and settlement and custody risks.
Investments in smaller companies typically involve greater risks than
investments in larger companies. Small company stocks, as a whole, may
experience larger price fluctuations than large-company stocks or other types of
investments. Some small companies may have shorter operating histories, less
experienced management and limited product lines, markets, and financial or
managerial resources.
The Fund may be affected by the broad investment environment in the
international or US securities markets, which is influenced by, among other
things, interest rates, inflation, politics, fiscal policy, and current events.
To the extent the Fund invests some of its assets in higher-risk securities,
such as illiquid securities, it may be subject to higher price volatility.
The Fund may actively and frequently trade securities in its portfolio to carry
out its principal strategies. A high portfolio turnover rate increases
transaction costs which may increase the Fund's expenses. Frequent and active
trading may also cause adverse tax consequences for investors in the Fund due to
an increase in short-term capital gains.
An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
11
<PAGE>
SELIGMAN GLOBAL SMALLER COMPANIES FUND
PAST PERFORMANCE
The Fund offers four Classes of shares. The information below provides some
indication of the risks of investing in the Fund by showing how the performance
of Class A shares has varied year to year, as well as how the performance of
each Class compares to two widely-used measures of performance. Although the
Fund's fiscal year ends on October 31, the performance is provided on a calendar
year basis to assist you in comparing the returns of the Fund with the returns
of other mutual funds. How the Fund has performed in the past, however, is not
necessarily an indication of how the Fund will perform in the future. Total
returns will vary between each Class of shares due to the different fees and
expenses of each Class.
The Class A annual total returns presented in the bar chart do not reflect the
effect of any sales charges. If these charges were included, the returns would
be lower. The average annual total returns presented in the table below the
chart do reflect the effect of the applicable sales charges. Both the bar chart
and table assume that all dividends and capital gain distributions were
reinvested.
Class A Annual Total Returns - Calendar Years
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
1993 40.06%
1994 10.14%
1995 25.83%
1996 16.84%
1997 3.55%
1998 5.71%
1999 24.12%
Best calendar quarter return: 18.72% - quarter ended 12/31/99.
Worst calendar quarter return: -17.21% - quarter ended 9/30/98.
- --------------------------------------------------------------------------------
Average Annual Total Returns - Periods Ended 12/31/99
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS D
ONE FIVE SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION
YEAR YEARS 9/9/92 4/22/96 5/27/99 5/3/93
------- ------- -------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Class A 18.21% 13.73% 16.78% n/a n/a n/a
Class B 18.21 n/a n/a 8.29% n/a n/a
Class C n/a n/a n/a n/a 28.08% n/a
Class D 22.26 13.98 n/a n/a n/a 15.40%
Salomon Smith
Barney EM Index World 22.38 13.04 12.80(1) 10.31(2) 17.95(3) 11.57(4)
Lipper Global Small Cap
Funds Average 45.23 17.34 16.32(1) 14.07(2) 39.65(3) 15.80(4)
</TABLE>
The Salomon Smith Barney Extended Market Index World (Salomon Smith Barney
EM Index World) and the Lipper Global Small Cap Funds Average are unmanaged
benchmarks that assume reinvestment of dividends. The Lipper Global Small Cap
Funds Average excludes the effect of sales charges and the Salomon Smith Barney
EM Index World excludes the effect of fees and sales charges. The Salomon Smith
Barney EM Index World measures the performance of small-cap stocks around the
world. The Lipper Global Small Cap Funds Average measure the performance of
mutual funds which invest at least 25% of their total assets in equity
securities of companies whose primary trading markets are outside the US, and
which invest at least 65% of total assets in companies with market
capitalizations of less than US $1 billion at the time of purchase.
(1) From 8/31/92.
(2) From 4/30/96.
(3) From 5/31/99.
(4) From 4/30/93.
- --------------------------------------------------------------------------------
12
<PAGE>
FEES AND EXPENSES
The table below summarizes the fees and expenses that you may pay as a
shareholder of the Fund. Each Class of shares has its own sales charge schedule
and is subject to different ongoing 12b-1 fees. Shareholder fees are charged
directly to your account. Annual fund operating expenses are deducted from Fund
assets and are therefore paid indirectly by you and other shareholders of the
Fund.
<TABLE>
<CAPTION>
Shareholder Fees Class A Class B Class C Class D
- ----------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) ....................................... 4.75% 5% 2% 1%
Maximum Sales Charge (Load) on Purchases
(as a% of offering price) .................................. 4.75%(1) none 1% none
Maximum Deferred Sales Charge (Load) (CDSC) on Redemptions
(as a% of original purchase price or current net asset value,
whichever is less) ........................................... none(1) 5% 1% 1%
Annual Fund Operating Expenses for Fiscal 1999
- ----------------------------------------------
(as a percentage of average net assets)
Management Fees ................................................... 1.00% 1.00% 1.00% 1.00%
Distribution and/or Service (12b-1) Fees .......................... 0.25% 1.00% 1.00% 1.00%
Other Expenses .................................................... 0.47% 0.47% 0.47% 0.47%
-------- -------- -------- --------
Total Annual Fund Operating Expenses ............................. 1.72% 2.47% 2.47% 2.47%
======== ======== ======== ========
</TABLE>
(1) If you buy Class A shares for $1,000,000 or more, you do not pay an initial
sales charge, but your shares will be subject to a 1% CDSC if sold within
18 months.
Example
- -------
This example is intended to help you compare the expenses of investing in the
Fund with the expenses of investing in other mutual funds. It assumes (1) you
invest $10,000 in the Fund for each period and then sell all of your shares at
the end of that period, (2) your investment has a 5% return each year, and (3)
the Fund's operating expenses remain the same. Although your actual expenses may
be higher or lower, based on these assumptions your expenses would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 642 $ 991 $1,364 $2,409
Class B 750 1,070 1,516 2,621+
Class C 447 862 1,402 2,878
Class D 350 770 1,316 2,806
If you did not sell your shares at the end of each period, your expenses would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 642 $ 991 $1,364 $2,409
Class B 250 770 1,316 2,621+
Class C 348 862 1,402 2,878
Class D 250 770 1,316 2,806
+ Class B shares will automatically convert to Class A shares after eight
years.
13
<PAGE>
SELIGMAN GLOBAL TECHNOLOGY FUND
INVESTMENT OBJECTIVE
The Global Technology Fund's investment objective is long-term capital
appreciation.
- --------------------------------------------------------------------------------
Technology:
The use of science to create new products and services. The industry comprises
information technology and communications, as well as medical-, environmental-
and bio-technology.
- --------------------------------------------------------------------------------
PRINCIPAL INVESTMENT STRATEGIES
The Fund uses the following principal investment strategies to seek its
investment objective:
The Fund generally invests at least 65% of its assets in equity securities of US
and non-US companies with business operations in technology and
technology-related industries. Technology-related companies are those companies
that use technology extensively to improve their business processes and
applications. The Fund may invest in companies domiciled in any country which
the investment manager believes to be appropriate to the Fund's objective. The
Fund generally invests in several countries in different geographic regions.
The Fund may invest in companies of any size. Securities of large companies that
are well established in the world technology market can be expected to grow with
the market and will frequently be held by the Fund. However, rapidly changing
technologies and expansion of technology and technology-related industries often
provide a favorable environment for companies of small-to-medium size, and the
Fund may invest in these companies as well.
The investment manager seeks to identify those technology companies that it
believes have the greatest prospects for future growth, regardless of their
countries of origin. The Fund uses an investment style that combines research
into individual company attractiveness with macro analysis. This means that the
investment manager uses extensive in-depth research to identify attractive
technology companies around the world, while seeking to identify particularly
strong technology sectors and/or factors within regions or specific countries
that may affect investment opportunities. In selecting individual securities,
the investment manager looks for companies that it believes display one or more
of the following:
o Above-average growth prospects
o High profit margins
o Attractive valuations relative to earnings forecasts or other
valuation criteria (e.g., return on equity)
o Quality management and equity ownership by executives
o Unique competitive advantages (e.g., market share, proprietary
products)
o Potential for improvement in overall operations
The Fund generally sells a stock if the investment manager believes its target
price has been reached, its earnings are disappointing, its revenue growth has
slowed, or its underlying fundamentals have deteriorated. The Fund may also sell
a stock if the investment manager believes that negative country or regional
factors may affect a company's outlook, or to meet cash requirements.
The Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. The Fund normally
concentrates its investments in common stocks; however, it may invest in other
types of equity securities, including securities convertible into or
exchangeable for common stock, depositary receipts, and rights and warrants to
purchase common stock. The Fund also may invest up to 25% of its assets in
preferred stock and investment-grade or comparable quality debt securities. The
Fund may also invest in depositary receipts, which are publicly traded
instruments generally issued by US or foreign banks or trust companies that
represent securities of foreign issuers.
14
<PAGE>
The Fund may invest up to 15% of its net assets in illiquid securities (i.e.,
securities that cannot be readily sold), and may from time to time enter into
forward foreign currency exchange contracts in an attempt to manage the risk of
adverse changes in currencies. The Fund may also purchase put options in an
attempt to hedge against a decline in the price of securities it holds in its
portfolio. A put option gives the Fund the right to sell an underlying security
at a particular price during a fixed period of time. Forward foreign currency
exchange contracts and put options on securities may not be available to the
Fund on reasonable terms in many situations, and the Fund may frequently choose
not to enter into such contracts or purchase such options even when they are
available.
The Fund may, from time to time, take temporary defensive positions that are
inconsistent with its principal strategies in seeking to minimize extreme
volatility caused by adverse market, economic, or other conditions. This could
prevent the Fund from achieving its objective.
The Fund may change its principal strategies if the Board of Directors believes
doing so is consistent with the Fund's objective. The Fund's objective may be
changed only with the approval of shareholders.
As with any mutual fund, there is no guarantee the Fund will achieve its
objective.
PRINCIPAL RISKS
Stock prices fluctuate. Therefore, as with any fund that invests in stocks, the
Fund's net asset value will fluctuate. You may experience a decline in the value
of your investment and you could lose money if you sell your shares at a price
lower than you paid for them.
Investing in securities of foreign issuers involves risks not associated with US
investments, including currency fluctuation, local withholding and other taxes,
different financial reporting practices and regulatory standards, high costs of
trading, changes in political conditions, expropriation, investment and
repatriation restrictions and settlement and custody risks.
The Fund may be susceptible to factors affecting technology and
technology-related industries, and the Fund's net asset value may fluctuate more
than a fund that invests in a wider range of industries. Technology companies
are often smaller and less experienced companies and may be subject to greater
risks than larger companies, such as limited product lines, markets, and
financial or managerial resources. These risks may be heightened for technology
companies in foreign markets.
The Fund seeks to limit risk by diversifying its investments among different
sectors within the technology industry, as well as among different countries.
Diversification reduces the effect the performance of any one sector or events
in any one country will have on the Fund's entire investment portfolio. However,
a decline in the value of one of the Fund's investments may offset potential
gains from other investments.
The Fund may be negatively affected by the broad investment environment in the
international or US securities markets, which is influenced by, among other
things, interest rates, inflation, politics, fiscal policy, and current events.
In addition, stocks of companies in the technology sector, like those in which
the Fund may invest, are experiencing a period of strong performance. However,
if investor sentiment changes, the value of technology stocks may decline. There
can be no assurances that the Fund will continue consistently to achieve, by
investing in initial public offerings or otherwise, substantially similar
performance that the Fund had previously experienced.
To the extent the Fund invests some of its assets in higher-risk securities,
such as illiquid securities, it may be subject to higher price volatility.
The Fund may actively and frequently trade securities in its portfolio to carry
out its principal strategies. A high portfolio turnover rate increases
transaction costs which may increase the Fund's expenses. Frequent and active
trading may also cause adverse tax consequences for investors in the Fund due to
an increase in short-term capital gains.
An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
15
<PAGE>
SELIGMAN GLOBAL TECHNOLOGY FUND
PAST PERFORMANCE
The Fund offers four Classes of shares. The information below provides some
indication of the risks of investing in the Fund by showing how the performance
of Class A shares has varied year to year, as well as how the performance of
each Class compares to four widely-used measures of performance. Although the
Fund's fiscal year ends on October 31, the performance is provided on a calendar
year basis to assist you in comparing the returns of the Fund with the returns
of other mutual funds. How the Fund has performed in the past, however, is not
necessarily an indication of how the Fund will perform in the future. Total
returns will vary between each Class of shares due to the different fees and
expenses of each Class.
The Class A annual total returns presented in the bar chart do not reflect the
effect of any sales charges. If these charges were included, the returns would
be lower. The average annual total returns presented in the table below the
chart do reflect the effect of the applicable sales charges. Both the bar chart
and table assume that all dividends and capital gain distributions were
reinvested.
Class A Annual Total Returns - Calendar Years
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
1995 45.06%
1996 14.30%
1997 11.75%
1998 30.73%
1999 116.23%
Best calendar quarter return: 55.72% - quarter ended 12/31/99.
Worst calendar quarter return: -16.69% - quarter ended 9/30/98.
- --------------------------------------------------------------------------------
Average Annual Total Returns - Periods Ended 12/31/99
<TABLE>
<CAPTION>
CLASS A AND D CLASS B CLASS C
ONE FIVE SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION
YEAR YEARS 5/23/94 4/22/96 5/27/99
------ ------ --------------- --------------- ---------------
<S> <C> <C> <C>
Class A 105.96% 37.93% 37.00% n/a n/a
Class B 109.62 n/a n/a 38.88% n/a
Class C n/a n/a n/a n/a 92.69%
Class D 113.64 38.17 37.09 n/a n/a
MSCI World Index 25.34 20.25 18.24(1) 19.86(2) 20.71(3)
H&Q Index 122.93 49.59 47.80(1) 49.18(2) 94.67(3)
Lipper Global Funds Average 34.52 19.38 16.83(1) 18.93(2) 29.70(3)
Lipper Science & Technology
Funds Average 137.64 48.31 46.26(1) 50.04(2) 98.19(3)
</TABLE>
The Morgan Stanley Capital International World Index (MSCI World Index), the
Hambrecht and Quist Technology Stock Index (H&Q Index), and the Lipper Funds
Averages are unmanaged benchmarks that assume reinvestment of dividends. The
Lipper Funds Averages exclude the effect of sales charges and the
MSCI World Index and the H&Q Index exclude the effect of fees and sales charges.
The MSCI World Index measures the performance of stocks in 22 developed markets
in North America, Europe, and the Asia/Pacific region. The H & Q Index measures
the performance of US technology stocks. The Lipper Global Funds average
measures the performance of mutual funds which invest at least 25% of total
assets in equity securities traded outside the US, and which may own US
securities. The Lipper Science and Technology Funds Average measures the
performance of mutual funds which invest at least 65% of total assets in science
and technology stocks.
(1) From 5/31/94.
(2) From 4/30/96.
(3) From 5/31/99.
- --------------------------------------------------------------------------------
16
<PAGE>
FEES AND EXPENSES
The table below summarizes the fees and expenses that you may pay as a
shareholder of the Fund. Each Class of shares has its own sales charge schedule
and is subject to different ongoing 12b-1 fees. Shareholder fees are charged
directly to your account. Annual fund operating expenses are deducted from Fund
assets and are therefore paid indirectly by you and other shareholders of the
Fund.
<TABLE>
<CAPTION>
Shareholder Fees Class A Class B Class C Class D
- ---------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) ....................................... 4.75% 5% 2% 1%
Maximum Sales Charge (Load) on Purchases
(as a% of offering price) ................................... 4.75%(1) none 1% none
Maximum Deferred Sales Charge (Load) (CDSC) on Redemptions
(as a% of original purchase price or current net asset value,
whichever is less) ........................................... none(1) 5% 1% 1%
Annual Fund Operating Expenses for Fiscal 1999
(as a percentage of average net assets)
Management Fees ................................................... 1.00% 1.00% 1.00% 1.00%
Distribution and/or Service (12b-1) Fees .......................... 0.25% 1.00% 1.00% 1.00%
Other Expenses .................................................... 0.34% 0.34% 0.34% 0.34%
-------- -------- -------- --------
Total Annual Fund Operating Expenses .............................. 1.59% 2.34% 2.34% 2.34%
======== ======== ======== ========
</TABLE>
(1) If you buy Class A shares for $1,000,000 or more, you do not pay an initial
sales charge, but your shares will be subject to a 1% CDSC if sold within
18 months.
Example
- -------
This example is intended to help you compare the expenses of investing in the
Fund with the expenses of investing in other mutual funds. It assumes (1) you
invest $10,000 in the Fund for each period and then sell all of your shares at
the end of that period, (2) your investment has a 5% return each year, and (3)
the Fund's operating expenses remain the same. Although your actual expenses may
be higher or lower, based on these assumptions your expenses would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 629 $ 953 $1,299 $2,274
Class B 737 1,030 1,450 2,489+
Class C 434 823 1,338 2,749
Class D 337 730 1,250 2,676
If you did not sell your shares at the end of each period, your expenses would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 629 $ 953 $1,299 $2,274
Class B 237 730 1,250 2,489+
Class C 335 823 1,338 2,749
Class D 237 730 1,250 2,676
+ Class B shares will automatically convert to Class A shares after eight
years.
17
<PAGE>
SELIGMAN INTERNATIONAL GROWTH FUND
INVESTMENT OBJECTIVE
The International Growth Fund's investment objective is long-term capital
appreciation.
PRINCIPAL INVESTMENT STRATEGIES
The Fund uses the following principal investment strategies to seek its
investment objective:
The Fund invests primarily in equity securities of non-US issuers. The Fund may
invest in any country; however, it typically will not invest in the United
States. It generally invests in several countries in different geographic
regions.
The Fund generally invests in the common stock of medium- to large-sized
companies in the principal international markets. However, it may also invest in
companies with a lower market capitalization or in smaller regional or emerging
markets.
The Fund uses a top-down investment style. This means the investment manager
concentrates first on regional and country allocations, then on industry
sectors, followed by fundamental analyses of individual companies. The Fund's
investments are allocated among geographic regions or countries based on such
factors as:
o Relative economic growth potential of the various economies and
securities markets
o Political, financial, and social conditions influencing investment
opportunities
o Investor sentiment
o Prevailing interest rates and expected levels of inflation
o Market prices relative to historic averages
In selecting individual securities, the investment manager looks to identify
companies that it believes display one or more of the following:
o Attractive valuations relative to earnings forecasts or other
valuation criteria (e.g., return on equity)
o Quality management and equity ownership by executives
o Unique competitive advantages (e.g., market share, proprietary
products)
o Market liquidity
o Potential for improvement in overall operations
The Fund generally sells a stock if the investment manager believes its target
price has been reached, its earnings are disappointing, its revenue growth has
slowed, or its underlying fundamentals have deteriorated. The Fund may also sell
a stock if the investment manager believes that negative country or regional
factors may affect a company's outlook, or to meet cash requirements.
The Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. The securities may be listed
on a US or foreign stock exchange or traded in US or foreign over-the-counter
markets. The Fund normally concentrates its investments in common stocks;
however, it may invest in other types of equity securities, including securities
convertible into or exchangeable for common stock, depositary receipts, and
rights and warrants to purchase common stock. The Fund also may invest up to 25%
of its assets in preferred stock and investment-grade or comparable quality debt
securities.
18
<PAGE>
The Fund may invest up to 15% of its net assets in illiquid securities (i.e.,
securities that cannot be readily sold), and may from time to time enter into
forward foreign currency exchange contracts in an attempt to manage the risk of
adverse changes in currencies. The Fund may also purchase put options in an
attempt to hedge against a decline in the price of securities it holds in its
portfolio. A put option gives the Fund the right to sell an underlying security
at a particular price during a fixed period of time. Forward foreign currency
exchange contracts and put options on securities may not be available to the
Fund on reasonable terms in many situations, and the Fund may frequently choose
not to enter into such contracts or purchase such options even when they are
available.
The Fund may, from time to time, take temporary defensive positions that are
inconsistent with its principal strategies in seeking to minimize extreme
volatility caused by adverse market, economic, or other conditions. This could
prevent the Fund from achieving its objective.
The Fund may change its principal strategies if the Board of Directors believes
doing so is consistent with the Fund's objective. The Fund's objective may be
changed only with the approval of shareholders.
As with any mutual fund, there is no guarantee the Fund will achieve its
objective.
PRINCIPAL RISKS
Stock prices fluctuate. Therefore, as with any fund that invests in stocks, the
Fund's net asset value will fluctuate. You may experience a decline in the value
of your investment and you could lose money if you sell your shares at a price
lower than you paid for them.
Investing in securities of foreign issuers involves risks not associated with US
investments, including currency fluctuation, local withholding and other taxes,
different financial reporting practices and regulatory standards, high costs of
trading, changes in political conditions, expropriation, investment and
repatriation restrictions and settlement and custody risks.
The Fund seeks to limit the risk of investing in foreign securities by
diversifying its investments among different regions and countries.
Diversification reduces the effect events in any one country will have on the
Fund's entire investment portfolio. However, a decline in the value of the
Fund's investments in one country may offset potential gains from investments in
another country.
The Fund may be negatively affected by the broad investment environment in the
international or US securities markets, which is influenced by, among other
things, interest rates, inflation, politics, fiscal policy, and current events.
To the extent the Fund invests some of its assets in higher-risk securities,
such as illiquid securities, it may be subject to higher price volatility.
The Fund may actively and frequently trade securities in its portfolio to carry
out its principal strategies. A high portfolio turnover rate increases
transaction costs, which may increase the Fund's expenses. Frequent and active
trading may also cause adverse tax consequences for investors in the Fund due to
an increase in short-term capital gains.
An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
19
<PAGE>
SELIGMAN INTERNATIONAL GROWTH FUND
PAST PERFORMANCE
The Fund offers four Classes of shares. The information below provides some
indication of the risks of investing in the Fund by showing how the performance
of Class A shares has varied year to year, as well as how the performance of
each Class compares to two widely-used measures of performance. Although the
Fund's fiscal year ends on October 31, the performance is provided on a calendar
year basis to assist you in comparing the returns of the Fund with the returns
of other mutual funds. How the Fund has performed in the past, however, is not
necessarily an indication of how the Fund will perform in the future. Total
returns will vary between each Class of shares due to the different fees and
expenses of each Class.
The Class A annual total returns presented in the bar chart do not reflect the
effect of any sales charges. If these charges were included, the returns would
be lower. The average annual total returns presented in the table below the
chart do reflect the effect of the applicable sales charges. Both the bar chart
and table assume that all dividends and capital gain distributions were
reinvested.
Class A Annual Total Returns - Calendar Years
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
1993 37.35%
1994 2.63%
1995 9.96%
1996 7.77%
1997 7.65%
1998 13.73%
1999 25.29%
Best calendar quarter return: 17.38% - quarter ended 12/31/98.
Worst calendar quarter return: -17.53% - quarter ended 9/30/98.
- --------------------------------------------------------------------------------
Average Annual Total Returns - Periods Ended 12/31/99
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS D
ONE FIVE SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION SINCE INCEPTION
YEAR YEARS 4/7/92 4/22/96 5/27/99 9/21/93
------- ------- ----------- ----------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Class A 19.32% 11.60% 12.33% n/a n/a n/a
Class B 19.44 n/a n/a 11.01% n/a n/a
Class C n/a n/a n/a n/a 22.47% n/a
Class D 23.33 11.76 n/a n/a n/a 11.00%
MSCI EAFE Index 27.30 13.15 13.47(1) 13.07(2) 27.07(3) 11.93(4)
Lipper International
Funds Average 39.68 15.47 13.78(1) 16.16(2) 36.94(3) 13.72(4)
</TABLE>
The Morgan Stanley Capital International EAFE (Europe, Australasia, Far East)
Index (MSCI EAFE Index) and the Lipper International Funds Average are unmanaged
benchmarks that assume reinvestment of dividends. The Lipper International Funds
Average excludes the effect of sales charges and the MSCI EAFE Index excludes
the effect of fees and sales charges. The MSCI EAFE Index measures the
performance of stocks in 20 developed markets in Europe, Australasia, and the
Far East. The Lipper International Funds Average measures the performance of
mutual funds which invest in equity securities of companies whose primary
trading markets are outside the US.
(1) From 3/31/92.
(2) From 4/30/96.
(3) From 5/31/99.
(4) From 9/30/93.
- --------------------------------------------------------------------------------
20
<PAGE>
FEES AND EXPENSES
The table below summarizes the fees and expenses that you may pay as a
shareholder of the Fund. Each Class of shares has its own sales charge schedule
and is subject to different ongoing 12b-1 fees. Shareholder fees are charged
directly to your account. Annual fund operating expenses are deducted from Fund
assets and are therefore paid indirectly by you and other shareholders of the
Fund.
<TABLE>
<CAPTION>
Shareholder Fees Class A Class B Class C Class D
- ---------------- ------- ------- ------- -------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) ....................................... 4.75% 5% 2% 1%
Maximum Sales Charge (Load) on Purchases
(as a% of offering price) .................................. 4.75%(1) none 1% none
Maximum Deferred Sales Charge (Load) (CDSC) on Redemptions
(as a% of original purchase price or current net asset value,
whichever is less) ........................................... none(1) 5% 1% 1%
Annual Fund Operating Expenses for Fiscal 1999
- ----------------------------------------------
(as a percentage of average net assets)
Management Fees ................................................... 1.00% 1.00% 1.00% 1.00%
Distribution and/or Service (12b-1) Fees .......................... 0.24% 1.00% 1.00% 1.00%
Other Expenses .................................................... 0.64% 0.64% 0.64% 0.64%
-------- -------- -------- --------
Total Annual Fund Operating Expenses .............................. 1.88% 2.64% 2.64% 2.64%
======== ======== ======== ========
</TABLE>
(1) If you buy Class A shares for $1,000,000 or more, you do not pay an initial
sales charge, but your shares will be subject to a 1% CDSC if sold within
18 months.
Example
- -------
This example is intended to help you compare the expenses of investing in the
Fund with the expenses of investing in other mutual funds. It assumes (1) you
invest $10,000 in the Fund for each period and then sell all of your shares at
the end of that period, (2) your investment has a 5% return each year, and (3)
the Fund's operating expenses remain the same. Although your actual expenses may
be higher or lower, based on these assumptions your expenses would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 657 $1,038 $1,443 $2,571
Class B 767 1,120 1,600 2,789+
Class C 463 912 1,486 3,044
Class D 367 820 1,400 2,973
If you did not sell your shares at the end of each period, your expenses would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Class A $ 657 $1,038 $1,443 $2,571
Class B 267 820 1,400 2,789+
Class C 364 912 1,486 3,044
Class D 267 820 1,400 2,973
+ Class B shares will automatically convert to Class A shares after eight
years.
21
<PAGE>
MANAGEMENT OF THE FUNDS
The Board of Directors provides broad supervision over the affairs of each Fund.
J. & W. Seligman & Co. Incorporated (Seligman), 100 Park Avenue, New York, New
York 10017, is the manager of each Fund. Seligman is responsible for each Fund's
investments and administers each Fund's business and other affairs.
Established in 1864, Seligman currently serves as manager to 20 US registered
investment companies, which offer more than 50 investment portfolios with
approximately $26.7 billion in assets as of January 31, 2000. Seligman also
provides investment management or advice to institutional or other accounts
having an aggregate value at January 31, 2000, of approximately $10.9 billion.
- --------------------------------------------------------------------------------
Affiliates of Seligman:
Seligman Advisors, Inc.:
Each Fund's general distributor; responsible for accepting orders for purchases
and sales of Fund shares.
Seligman Services, Inc.:
A limited purpose broker/dealer; acts as the broker/dealer of record for
shareholder accounts that do not have a designated broker or financial advisor.
Seligman Data Corp. (SDC):
Each Fund's shareholder service agent; provides shareholder account services to
the Funds at cost.
- --------------------------------------------------------------------------------
Each Fund pays Seligman a fee for its management services equal to a percentage
of the Fund's average daily net assets. The fee rate declines as each Fund's net
assets increase. The management fee rates are:
o Emerging Markets Fund
1.25% on first $1 billion of net assets
1.15% on next $1 billion of net assets
1.05% on net assets in excess of $2 billion
o Global Technology Fund
1.00% on first $2 billion of net assets
0.95% on next $2 billion of net assets
0.90% on net assets in excess of $4 billion
o Other Funds (Global Growth Fund, Global Smaller Companies Fund,
International Growth Fund)
1.00% on first $1 billion of net assets
0.95% on next $1 billion of net assets
0.90% on net assets in excess of $2 billion
The Subadviser
Henderson Investment Management Limited (HIML) has provided investment advice,
research and assistance to Seligman with respect to the Funds' non-US
investments. HIML, whose address is 3 Finsbury Avenue, London EC2M 2PA, was
established in 1984 and is a wholly owned subsidiary of Henderson plc, a United
Kingdom corporation. Henderson plc is a subsidiary of AMP Limited, an Australian
life insurance and financial services company.
Beginning the close of business on March 31, 2000, HIML will no longer assist
Seligman with respect to the International Growth Fund, the Emerging Markets
Fund, the Global Growth Fund and the Global Technology Fund. However, HIML will
continue to sub-advise the Global Smaller Companies Fund with respect to the
Fund's non-US investments.
Seligman pays HIML a fee for the services it provides. This fee does not
increase the fee payable by any Fund.
Portfolio Management
International Growth Fund and Global Growth Fund
The International Growth Fund and the Global Growth Fund are managed by
Seligman's Global Growth Team, which is co-headed by Ms. Marion S. Schultheis
and Mr. Jack P. Chang.
22
<PAGE>
Ms. Schultheis joined Seligman in May 1998 as a Managing Director. She is a Vice
President of Seligman Global Fund Series, Inc. and has been Co-Portfolio Manager
of the Global Growth Fund since May 1998. Prior to joining Seligman, Ms.
Schultheis was a Managing Director at Chancellor LGT from October 1997 to May
1998 and Senior Portfolio Manager at IDS Advisory Group Inc. from August 1987 to
October 1997. Ms. Schultheis also manages Seligman Capital Fund, Inc. and
Seligman Growth Fund, Inc. She is a Vice President of Seligman Portfolios, Inc.
and Portfolio Manager of its Seligman Capital Portfolio and Seligman Large-Cap
Growth Portfolio and Co-Portfolio Manager of its Seligman International Growth
Portfolio and Seligman Global Growth Portfolio.
Mr. Chang joined Seligman on September 20, 1999 as a Managing Director. He is a
Vice President of Seligman Global Fund Series, Inc. Prior to joining Seligman,
Mr. Chang was a Senior Vice President and Portfolio Manager at Putnam Investment
Management since 1997. Before that, he was a Portfolio Manager with Columbia
Management Company from 1993 to 1997, and a Senior Analyst and Portfolio Manager
with Scudder, Stevens & Clark from 1989 to 1993. Mr. Chang is also a Vice
President of Seligman Portfolios, Inc. and Co-Portfolio Manager of its Seligman
International Growth Portfolio and Seligman Global Growth Portfolio.
Emerging Markets Fund
The Emerging Markets Fund is managed by Seligman's Emerging Markets Team headed
by Mr. Daniel J. Barker, who joined Seligman on October 11, 1999 as a Senior
Vice President and is a Vice President of Seligman Global Fund Series Inc. Prior
to joining Seligman, Mr. Barker was a Portfolio Manager at GE Investments since
1994. Before that, Mr. Barker was a Corporate Financial Analyst at GE
Information Services from 1990 to 1994.
Global Smaller Companies Fund
The Global Smaller Companies Fund is co-managed by Seligman's Small Company Team
and HIML's International Team. The Small Company Team is headed by Mr. Arsen
Mrakovcic. Mr. Mrakovcic, a Managing Director of Seligman, has been Vice
President of Seligman Global Fund Series, Inc. and Portfolio Manager of the Fund
since October 1, 1995. Mr. Mrakovcic joined Seligman in June 1992 as a Portfolio
Assistant. He was named Vice President, Investment Officer on January 1, 1995,
and Managing Director on January 1, 1996. Mr. Mrakovcic is also Vice President
and Portfolio Manager of Seligman Frontier Fund, Inc. and Vice President of
Seligman Portfolios, Inc. and Portfolio Manager of its Seligman Frontier
Portfolio and Co-Portfolio Manager of its Seligman Global Smaller Companies
Portfolio.
HIML's International Team in respect of the Global Smaller Companies Fund is
headed by Mr. Iain C. Clark, Chief Investment Officer of HIML. Mr. Clark has
been Vice President of Seligman Global Fund Series, Inc. and Co-Portfolio
Manager of the Global Smaller Companies Fund since September 1992. He also has
been a Portfolio Manager of the International Growth Fund. Mr. Clark also has
been Vice President of Seligman Portfolios, Inc. and Portfolio Manager of its
Seligman International Growth Portfolio and Co-Portfolio Manager of its Seligman
Global Smaller Companies Portfolio. He is a Director of Henderson International
Limited and Vice President, Secretary and Treasurer of Henderson International,
Inc. Mr. Clark has been Director and Senior Portfolio Manager of Henderson plc
since 1985.
Global Technology Fund
Seligman's Global Technology Team manages the Global Technology Fund. The Global
Technology Team is headed by Mr. Paul H. Wick, Vice President of Seligman Global
Fund Series, Inc. and Co-Portfolio Manager of the Global Technology Fund since
May 1994. Mr. Wick has been a Managing Director of Seligman since January 1995
and a Director of Seligman since November 1997. He joined Seligman in 1987 as an
Associate, Investment Research. Mr. Wick has been Vice President and Portfolio
Manager of Seligman Communications and Information Fund, Inc. since January 1990
and December 1989, respectively. He is also Vice President of Seligman
Portfolios, Inc. and Portfolio Manager of its Seligman Communications and
Information Portfolio and Co-Portfolio Manager of its Seligman Global Technology
Portfolio and the Seligman New Technologies Fund, Inc.
23
<PAGE>
Ms. Kei Yamamoto, a Senior Vice President of Seligman, is Co-Portfolio Manager
of the Global Technology Fund. She is a Vice President of the Seligman Global
Fund Series, Inc. Ms. Yamamoto joined Seligman in May 1998 as a Vice President
and has been a Senior Vice President since January 2000. Prior to joining
Seligman, Ms. Yamamoto was an Associate Portfolio Manager at Oppenheimer Funds,
Inc. from 1997 to 1998 and an Assistant Portfolio Manager at Franklin Templeton
Group from 1994 to 1997. She is also a Vice President of Seligman Portfolios,
Inc. and Co-Portfolio Manager of its Seligman Global Technology Portfolio.
Mr. Steven A. Werber, who joined Seligman on January 10, 2000 as a Senior Vice
President, is Co-Portfolio Manager of the Global Technology Fund. He is a Vice
President of Seligman Global Fund Series, Inc. Prior to joining Seligman, Mr.
Werber was an Analyst and Portfolio Manager at Fidelity Investments
International since 1996. Prior thereto, he was an Associate, Credit Department,
at Goldman Sachs International from 1992 to 1996 and a Trust Officer at Barnett
Trust Company from 1987 to 1990. Mr. Werber is also a Vice President of Seligman
Portfolios, Inc. and Co-Portfolio Manager of its Seligman Global Technology
Portfolio.
24
<PAGE>
Shareholder Information
DECIDING WHICH CLASS OF SHARES TO BUY
Each of the Fund's Classes represents an interest in the same portfolio of
investments. However, each Class has its own sales charge schedule, and its
ongoing 12b-1 fees may differ from other Classes. When deciding which Class of
shares to buy, you should consider, among other things:
o The amount you plan to invest.
o How long you intend to remain invested in that Fund, or another
Seligman mutual fund.
o If you would prefer to pay an initial sales charge and lower ongoing
12b-1 fees, or be subject to a CDSC and pay higher ongoing 12b-1 fees.
o Whether you may be eligible for reduced or no sales charges when you
buy or sell shares.
Your financial advisor will be able to help you decide which Class
of shares best meets your needs.
- --------------------------------------------------------------------------------
Class A
o Initial sales charge on Fund purchases, as set forth below:
<TABLE>
<CAPTION>
Sales Charge Regular Dealer
Sales Charge as a% Discount
as a% of Net as a% of
Amount of your Investment of Offering Price(1) Amount Invested Offering Price
- --------------------------- -------------------- --------------- ---------------
<S> <C> <C> <C>
Less than $ 50,000 4.75% 4.99% 4.25%
$50,000 - $ 99,999 4.00 4.17 3.50
$100,000 - $249,999 3.50 3.63 3.00
$250,000 - $499,999 2.50 2.56 2.25
$500,000 - $999,999 2.00 2.04 1.75
$1,000,000 and over(2) 0.00 0.00 0.00
</TABLE>
(1) "Offering Price" is the amount that you actually pay for Fund shares; it
includes the initial sales charge.
(2) You will not pay a sales charge on purchases of $1 million or more, but you
will be subject to a 1% CDSC if you sell your shares within 18 months.
o Annual 12b-1 fee (for shareholder services) of up to 0.25%.
o No sales charge on reinvested dividends or capital gain distributions.
o Certain employer-sponsored defined contribution-type plans can purchase
shares with no initial sales charge.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class B
o No initial sales charge on purchases.
o A declining CDSC on shares sold within 6 years of purchase:
====================================================================
Your purchase of Class B shares must be for less than $250,000,
because if you are investing $250,000 or more, you will pay less in
fees and charges if you buy another Class of shares.
====================================================================
Years Since Purchase CDSC
-------------------- ----
Less than 1 year 5%
1 year or more but less than 2 years 4
2 years or more but less than 3 years 3
3 years or more but less than 4 years 3
4 years or more but less than 5 years 2
5 years or more but less than 6 years 1
6 years or more 0
o Annual 12b-1 fee (for distribution and shareholder services) of 1.00%.
o Automatic conversion to Class A shares after eight years, resulting in
lower ongoing 12b-1 fees.
o No CDSC when you sell shares purchased with reinvested dividends or capital
gain distributions.
- --------------------------------------------------------------------------------
25
<PAGE>
- --------------------------------------------------------------------------------
Class C
o Initial sales charge on Fund purchases, as set forth below:
<TABLE>
<CAPTION>
Regular Dealer
Sales Charge Sales Charge Discount
as a% as a% of Net as a% of
Amount of your Investment of Offering Price(1) Amount Invested Offering Price
- -------------------------- -------------------- --------------- --------------
<S> <C> <C> <C>
Less than $100,000 1.00% 1.01% 1.00%
$100,000 - $249,999 0.50 0.50 0.50
$250,000 - $1,000,000(2) 0.00 0.00 0.00
</TABLE>
(1) "Offering Price" is the amount that you actually pay for Fund shares; it
includes the initial sales charge.
(2) Your purchase of Class C shares must be for less than $1,000,000 because if
you invest $1,000,000 or more you will pay less in fees and charges if you
buy Class A shares.
o A 1% CDSC on shares sold within eighteen months of purchase
o Annual 12b-1 fee (for distribution and shareholder services) of 1.00%.
o No automatic conversion to Class A shares, so you will be subject to higher
ongoing 12b-1 fees indefinitely.
o No sales charge on reinvested dividends or capital gain distributions.
o No CDSC when you sell shares purchased with reinvested dividends or capital
gain distributions.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class D*
o No initial sales charge on purchases.
o A 1% CDSC on shares sold within one year of purchase.
o Annual 12b-1 fee (for distribution and shareholder services) of 1.00%.
o No automatic conversion to Class A shares, so you will be subject to higher
ongoing 12b-1 fees indefinitely.
o No CDSC when you sell shares purchased with reinvested dividends or capital
gain distributions.
* Class D shares are not available to all investors. You may purchase
Class D shares only (1) if you already own Class D shares of the Fund
or another Seligman mutual fund, (2) if your financial advisor of
record maintains an omnibus account at SDC, or (3) pursuant to a
401(k) or other retirement plan program for which Class D shares are
already available or for which the sponsor requests Class D shares
because the sales charge structure of Class D shares is comparable to
the sales charge structure of the other funds offered under the
program.
- --------------------------------------------------------------------------------
Each Fund has adopted a plan under Rule 12b-1 of the Investment Company Act of
1940 that allows each Class to pay 12b-1 fees for the sale and distribution of
its shares and/or for providing services to shareholders.
Because each Fund's 12b-1 fees are paid out of each Class's assets on an ongoing
basis, over time these fees will increase your investment expenses and may cost
you more than other types of sales charges.
The Funds' Board of Directors believes that no conflict of interest currently
exists between each Fund's Class A, Class B, Class C and Class D shares. On an
ongoing basis, the Directors, in the exercise of their fiduciary duties under
the Investment Company Act of 1940 and Maryland law, will seek to ensure that no
such conflict arises.
How CDSCs Are Calculated
To minimize the amount of the CDSC you may pay when you sell your shares, each
Fund assumes that shares acquired through reinvested dividends and capital gain
distributions (which are not subject to a CDSC) are sold first. Shares that have
been in your account long enough so they are not subject to a CDSC are sold
next. After these shares are exhausted, shares will be sold in the order they
were purchased (oldest to youngest). The amount of any CDSC that you pay will be
based on the shares' original purchase price or current net asset value,
whichever is less.
You will not pay a CDSC when you exchange shares of any Fund to buy the same
class of shares of any other Seligman mutual fund. For the purpose of
calculating the CDSC when you sell shares that you acquired by exchanging shares
of any Fund, it will be assumed that you held the shares since the date you
purchased the shares of that Fund.
26
<PAGE>
PRICING OF FUND SHARES
When you buy or sell shares, you do so at the Class's net asset value (NAV) next
calculated after Seligman Advisors accepts your request. Any applicable sales
charge will be added to the purchase price for Class A shares and Class C
shares. Purchase or sale orders received by an authorized dealer or financial
advisor by the close of regular trading on the New York Stock Exchange (NYSE)
(normally 4:00 p.m. Eastern time) and accepted by Seligman Advisors before the
close of business (5:00 p.m. Eastern time) on the same day will be executed at
the Class's NAV calculated as of the close of regular trading on the NYSE on
that day. Your broker/dealer or financial advisor is responsible for forwarding
your order to Seligman Advisors before the close of business.
- --------------------------------------------------------------------------------
NAV:
Computed separately for each Class by dividing that Class's share of the net
assets of the Fund (i.e., its assets less liabilities) by the total number of
outstanding shares of the Class.
- --------------------------------------------------------------------------------
If your buy or sell order is received by your broker/dealer or financial advisor
after the close of regular trading on the NYSE, or is accepted by Seligman
Advisors after the close of business, the order will be executed at the Class's
NAV calculated as of the close of regular trading on the next NYSE trading day.
When you sell shares, you receive the Class's per share NAV, less any applicable
CDSC.
The NAV of each Fund's shares is determined each day, Monday through Friday, on
days that the NYSE is open for trading. Because the Funds have portfolio
securities that are primarily listed on foreign exchanges that may trade on
weekends or other days when the Funds do not price their shares, the value of a
Fund's portfolio securities may change on days when you may not be able to buy
or sell Fund shares. Because of their higher 12b-1 fees, the NAV of Class B,
Class C and Class D shares will generally be lower than the NAV of Class A
shares of the same Fund.
Securities owned by a Fund are valued at current market prices. If reliable
market prices are unavailable, securities are valued in accordance with
procedures approved by the Board of Directors.
OPENING YOUR ACCOUNT
The Funds' shares are sold through authorized broker/dealers or financial
advisors who have sales agreements with Seligman Advisors. There are several
programs under which you may be eligible for reduced sales charges or lower
minimum investments. Ask your financial advisor if any of these programs apply
to you. Class D shares are not available to all investors. For more information,
see "Deciding Which Class of Share to Buy - Class D."
To make your initial investment in a Fund, contact your financial advisor or
complete an account application and send it with your check directly to SDC at
the address provided on the account application. If you do not choose a Class,
your investment will automatically be made in Class A shares.
The required minimum initial investments are:
o Regular (non-retirement) accounts: $1,000
o For accounts opened concurrently with Invest-A-Check(R):
$100 to open if you will be making monthly investments
$250 to open if you will be making quarterly investments
- --------------------------------------------------------------------------------
You may buy shares of any Fund for all types of tax-deferred retirement plans.
Contact Retirement Plan Services at the address or phone number listed on the
inside back cover of this prospectus for information and to receive the proper
forms.
- --------------------------------------------------------------------------------
If you buy shares by check and subsequently sell the shares, SDC will not send
your proceeds until your check clears, which could take up to 15 calendar days
from the date of your purchase.
You will be sent a statement confirming your purchase and any subsequent
transactions in your account. You will also be sent quarterly and annual
statements detailing your transactions in that Fund and the other Seligman funds
you own under the same account number. Duplicate account statements will be sent
to you free of charge for the current year and most recent prior year. Copies of
year-end statements for prior years are available for a fee of $10 per year, per
account, with a maximum charge of $150 per account. Send your request and a
check for the fee to SDC.
If you want to be able to buy, sell, or exchange shares by telephone, you
should complete an application when you open your account. This will prevent
you from having to complete a supplemental election form (which may
require a signature guarantee) at a later date.
27
<PAGE>
HOW TO BUY ADDITIONAL SHARES
After you have made your initial investment, there are many options available to
make additional purchases of Fund shares. Subsequent investments must be for
$100 or more. Shares may be purchased through your authorized financial advisor,
or you may send a check directly to SDC. Please provide either an investment
slip or a note that provides your name(s), Fund name, and account number. Unless
you indicate otherwise, your investment will be made in the Class you already
own. Send investment checks to:
Seligman Data Corp.
P.O. Box 9766
Providence, RI 02940-9766
Your check must be in US dollars and be drawn on a US bank. You may not use
third party or credit card convenience checks for investment.
You may also use the following account services to make additional investments:
Invest-A-Check(R). You may buy Fund shares electronically from a savings or
checking account of an Automated Clearing House (ACH) member bank. If your bank
is not a member of ACH, the Fund will debit your checking account by
preauthorized checks. You may buy Fund shares at regular monthly intervals in
fixed amounts of $100 or more, or regular quarterly intervals in fixed amounts
of $250 or more. If you use Invest-A-Check(R), you must continue to make
automatic investments until the Fund's minimum initial investment of $1,000 is
met or your account may be closed.
Automatic Dollar-Cost-Averaging. If you have at least $5,000 in Seligman Cash
Management Fund, you may exchange uncertificated shares of that fund to buy
shares of the same class of another Seligman mutual fund at regular monthly
intervals in fixed amounts of $100 or more or regular quarterly intervals in
fixed amounts of $250 or more. If you exchange Class A shares, or Class C
shares, you may pay an initial sales charge to buy Fund shares.
Automatic CD Transfer. You may instruct your bank to invest the proceeds of a
maturing bank certificate of deposit (CD) in shares of the Fund. If you wish to
use this service, contact SDC or your financial advisor to obtain the necessary
forms. Because your bank may charge you a penalty, it is not normally advisable
to withdraw CD assets before maturity.
Dividends From Other Investments. You may have your dividends from other
companies paid to the Fund. (Dividend checks must include your name, account
number, Fund name, and Class of shares.)
Direct Deposit. You may buy Fund shares electronically with funds from your
employer, the IRS, or any other institution that provides direct deposit. Call
SDC for more information.
Seligman Time Horizon Matrix(SM). (Requires an initial total investment of
$10,000.) This is a needs-based investment process, designed to help you and
your financial advisor plan to seek your long-term financial goals. It considers
your financial needs, and helps frame a personalized asset allocation strategy
around the cost of your future commitments and the time you have to meet them.
Contact your financial advisor for more information.
Seligman Harvester(SM). If you are a retiree or nearing retirement, this program
is designed to help you establish an investment strategy that seeks to meet your
needs throughout your retirement. The strategy is customized to your personal
financial situation by allocating your assets to seek to address your income
requirements, prioritizing your expenses, and establishing a prudent withdrawal
schedule. Contact your financial advisor for more information.
28
<PAGE>
HOW TO EXCHANGE SHARES AMONG THE SELIGMAN MUTUAL FUNDS
You may sell Fund shares to buy shares of the same Class of another Seligman
mutual fund, or you may sell shares of another Seligman mutual fund to buy
shares of any Fund. Exchanges will be made at each fund's respective NAV. You
will not pay an initial sales charge when you exchange, unless you exchange
Class A shares or Class C shares of Seligman Cash Management Fund to buy shares
of the same class of a Fund or another Seligman mutual fund.
Only your dividend and capital gain distribution options and telephone services
will be automatically carried over to any new fund account. If you wish to carry
over any other account options (for example, Invest-A-Check(R) or Systematic
Withdrawals) to the new fund, you must specifically request so at the time of
your exchange.
If you exchange into a new fund, you must exchange enough to meet the new fund's
minimum initial investment.
See "The Seligman Mutual Funds" for a list of the funds available for exchange.
Before making an exchange, contact your financial advisor or SDC to obtain the
applicable fund prospectus(es). You should read and understand a fund's
prospectus before investing. Some funds may not offer all Classes of shares.
HOW TO SELL SHARES
The easiest way to sell Fund shares is by phone. If you have telephone services,
you may be able use this service to sell Fund shares. Restrictions apply to
certain types of accounts. Please see "Important Policies That May Affect Your
Account."
When you sell Fund shares by phone, a check for the proceeds is sent to your
address of record. If you have current ACH bank information on file, you may
have the proceeds of the sale of your Fund shares directly deposited into your
bank account (typically, 3-4 business days after your shares are sold).
You may sell shares to the Fund through a broker/dealer or your financial
advisor. The Fund does not charge any fees or expenses, other than any
applicable CDSC, for this transaction; however, the dealer or financial advisor
may charge a service fee. Contact your financial advisor for more information.
You may always send a written request to sell Fund shares; however, it may take
longer to get your money.
As an additional measure to protect you and the Fund, SDC may confirm written
redemption requests that are (1) for $25,000 or more, or (2) directed to be paid
to an alternate payee or sent to an address other than the address of record,
with you or your financial advisor by telephone before sending you your money.
This will not affect the date on which your redemption request is actually
processed.
You will need to guarantee your signature(s) if the proceeds are:
(1) $50,000 or more;
(2) to be paid to someone other than the account owner; or
(3) mailed to other than your address of record.
- --------------------------------------------------------------------------------
Signature Guarantee:
Protects you and the Funds from fraud. It guarantees that a signature is
genuine. A guarantee must be obtained from an eligible financial institution.
Notarization by a notary public is not an acceptable guarantee.
- --------------------------------------------------------------------------------
You may need to provide additional documents to sell Fund shares if you are:
o a corporation;
o an executor or administrator;
o a trustee or custodian; or
o in a retirement plan.
If your Fund shares are represented by certificates, you will need to surrender
the certificates to SDC before you sell your shares.
Contact your financial advisor or SDC's Shareholder Services Department for
information on selling your shares under any of the above circumstances.
You may also use the following account service to sell Fund shares:
Systematic Withdrawal Plan. If you have at least $5,000 in a Fund, you may
withdraw (sell) a fixed dollar amount (minimum of $50) of uncertificated shares
at regular intervals. A check will be sent to you at your address of record or,
if you have current ACH bank information on file, you may have your payments
directly deposited to your predesignated bank account in 3-4 business days after
your shares are sold. If you bought $1,000,000 or more of Class A shares without
an initial sales charge, your withdrawals may be subject to a 1% CDSC if they
occur within 18 months of purchase. If you own Class B, Class C or Class D
shares and reinvest your dividends and capital gain distributions, you may
withdraw 12%, 10%, or 10%, respectively, of the value of your fund account (at
the time of election) annually without a CDSC.
29
<PAGE>
IMPORTANT POLICIES THAT MAY AFFECT YOUR ACCOUNT
To protect you and other shareholders, each Fund reserves the right to:
o Refuse an exchange request if:
1. you have exchanged twice from the same fund in any three-month
period;
2. the amount you wish to exchange equals the lesser of $1,000,000
or 1% of the Fund's net assets; or
3. you or your financial advisor have been advised that previous
patterns of purchases and sales or exchanges have been considered
excessive.
o Refuse any request to buy Fund shares.
o Reject any request received by telephone.
o Suspend or terminate telephone services.
o Reject a signature guarantee that SDC believes may be fraudulent.
o Close your fund account if its value falls below $500.
o Close your account if it does not have a certified taxpayer
identification number.
Telephone Services
You and your broker/dealer or financial advisor will be able to place the
following requests by telephone, unless you indicate on your account application
that you do not want telephone services:
o Sell uncertificated shares (up to $50,000 per day, payable to account
owner(s) and mailed to address of record).
o Exchange shares between funds.
o Change dividend and/or capital gain distribution options.
o Change your address.
o Establish systematic withdrawals to address of record.
If you do not complete an account application when you open your account,
telephone services must be elected on a supplemental election form (which may
require a signature guarantee).
Restrictions apply to certain types of accounts:
o Trust accounts on which the current trustee is not listed may not sell
Fund shares by phone.
o Corporations may not sell Fund shares by phone.
o IRAs may only exchange Fund shares or request address changes by
phone.
o Group retirement plans may not sell Fund shares by phone; plans that
allow participants to exchange by phone must provide a letter of
authorization signed by the plan custodian or trustee and provide a
supplemental election form signed by all plan participants.
Unless you have current ACH bank information on file, you will not be able to
sell Fund shares by phone within thirty days following an address change.
Your request must be communicated to an SDC representative. You may not request
any phone transactions via the automated access line.
You may cancel telephone services at any time by sending a written request to
SDC. Each account owner, by accepting or adding telephone services, authorizes
each of the other owners to make requests by phone. Your broker/dealer or
financial advisor representative may not establish telephone services without
your written authorization. SDC will send written confirmation to the address of
record when telephone services are added or terminated.
During times of heavy call volume, you may not be able to get through to SDC by
phone to request a sale or exchange of Fund shares. In this case, you may need
to write, and it may take longer for your request to be processed. A Fund's NAV
may fluctuate during this time.
The Funds and SDC will not be liable for processing requests received by phone
as long as it was reasonable to believe that the request was genuine.
Reinstatement Privilege
If you sell Fund shares, you may, within 120 calendar days, use part or all of
the proceeds to buy shares of the same Fund or any other Seligman mutual fund
(reinstate your investment) without paying an initial sales charge or, if you
paid a CDSC when you sold your shares, receiving a credit for the applicable
CDSC paid. This privilege is available only once each calendar year. Contact
your financial advisor for more information. You should consult your tax advisor
concerning possible tax consequences of exercising this privilege.
30
<PAGE>
DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS
Each Fund generally pays any dividends from its net investment income and
distributes net capital gains realized on investments annually. It is expected
that each Fund's distributions will be primarily capital gains.
- --------------------------------------------------------------------------------
Dividend:
A payment by a mutual fund, usually derived from the fund's net investment
income (dividends and interest earned on portfolio securities less expenses).
Capital Gain Distribution:
A payment to mutual fund shareholders which represents profits realized on the
sale of securities in a fund's portfolio.
Ex-dividend Date:
The day on which any declared distributions (dividends or capital gains) are
deducted from a fund's assets before it calculates its NAV.
- --------------------------------------------------------------------------------
You may elect to:
(1) reinvest both dividends and capital gain distributions;
(2) receive dividends in cash and reinvest capital gain distributions; or
(3) receive both dividends and capital gain distributions in cash.
Your dividends and capital gain distributions will be reinvested if you do not
instruct otherwise or if you own Fund shares in a Seligman tax-deferred
retirement plan.
If you want to change your election, you may write SDC at the address listed on
the back cover of this prospectus or, if you have telephone services, you or
your financial advisor may call SDC. Your request must be received by SDC before
the record date to be effective for that dividend or capital gain distribution.
Cash dividends or capital gain distributions will be sent by check to your
address of record or, if you have current ACH bank information on file, directly
deposited into your predesignated bank account within 3-4 business days from the
payable date.
Dividends and capital gain distributions are reinvested to buy additional Fund
shares on the payable date using the NAV of the ex-dividend date.
Dividends on Class B, Class C, and Class D shares will be lower than the
dividends on Class A shares as a result of their higher 12b-1 fees. Capital gain
distributions will be paid in the same amount for each Class.
TAXES
The tax treatment of dividends and capital gain distributions is the same
whether you take them in cash or reinvest them to buy additional Fund shares.
Tax-deferred retirement plans are not taxed currently on dividends or capital
gain distributions or on exchanges.
Dividends paid by the Fund are taxable to you as ordinary income. You may be
taxed at different rates on capital gains distributed by the Fund depending on
the length of time the Fund holds its assets.
When you sell Fund shares, any gain or loss you realize will generally be
treated as a long-term capital gain or loss if you held your shares for more
than one year, or as a short-term capital gain or loss if you held your shares
for one year or less. However, if you sell Fund shares on which a long-term
capital gain distribution has been received and you held the shares for six
months or less, any loss you realize will be treated as a long-term capital loss
to the extent that it offsets the long-term capital gain distribution.
An exchange of Fund shares is a sale and may result in a gain or loss for
federal income tax purposes.
Each January, you will be sent information on the tax status of any
distributions made during the previous calendar year. Because each shareholder's
situation is unique, you should always consult your tax advisor concerning the
effect income taxes may have on your individual investment.
31
<PAGE>
THE SELIGMAN MUTUAL FUNDS
EQUITY
SPECIALTY
- --------------------------------------------------------------------------------
Seligman Communications and Information Fund
Seeks capital appreciation by investing in companies operating in all aspects of
the communications, information, and related industries.
Seligman Global Technology Fund
Seeks long-term capital appreciation by investing primarily in global securities
(US and non-US) of companies in the technology and technology-related
industries.
Seligman Emerging Markets Fund
Seeks long-term capital appreciation by investing primarily in equity securities
of companies in emerging markets.
SMALL COMPANY
- --------------------------------------------------------------------------------
Seligman Frontier Fund
Seeks growth of capital by investing primarily in small company growth stocks.
Seligman Small-Cap Value Fund
Seeks long-term capital appreciation by investing in equities of small
companies, deemed to be "value" companies by the investment manager.
Seligman Global Smaller Companies Fund
Seeks long-term capital appreciation by investing in securities of smaller
companies around the world, including the US.
MEDIUM COMPANY
- --------------------------------------------------------------------------------
Seligman Capital Fund
Seeks capital appreciation by investing in the common stocks of companies
with significant potential for growth.
LARGE COMPANY
- --------------------------------------------------------------------------------
Seligman Growth Fund
Seeks long-term growth of capital value and an increase in future income.
Seligman Global Growth Fund
Seeks capital appreciation by investing primarily in equity securities of
companies that have the potential to benefit from global economic or social
trends.
Seligman Large-Cap Value Fund
Seeks long-term capital appreciation by investing in equities of large
companies, deemed to be "value" companies by the investment manager.
Seligman Common Stock Fund
Seeks favorable, but not the highest, current income and long-term growth of
both income and capital, without exposing capital to undue risk.
Seligman International Growth Fund
Seeks long-term capital appreciation by investing in securities of medium- to
large-sized companies, primarily in the developed markets outside the US.
BALANCED
- --------------------------------------------------------------------------------
Seligman Income Fund
Seeks high current income and improvement in capital value over the long term,
consistent with prudent risk of capital.
FIXED-INCOME
INCOME
- --------------------------------------------------------------------------------
Seligman High-Yield Bond Fund
Seeks to maximize current income by investing in a diversified portfolio of
high-yielding, high-risk corporate bonds, commonly referred to as "junk bonds."
Seligman U.S. Government Securities Fund
Seeks high current income primarily by investing in a diversified portfolio of
securities guaranteed by the US government, its agencies, or instrumentalities,
which have maturities greater than one year.
MUNICIPAL
- --------------------------------------------------------------------------------
Seligman Municipal Funds:
National Fund
Seeks maximum income, exempt from regular federal income taxes.
State-specific funds:*
Seek to maximize income exempt from regular federal income taxes and from
regular income taxes in the designated state.
California Louisiana New Jersey
oHigh-Yield Maryland New York
oQuality Massachusetts North Carolina
Colorado Michigan Ohio
Florida Minnesota Oregon
Georgia Missouri Pennsylvania
South Carolina
* A small portion of income may be subject to state taxes.
MONEY MARKET
- --------------------------------------------------------------------------------
Seligman Cash Management Fund
Seeks to preserve capital and to maximize liquidity and current income, by
investing only in high-quality money market securities having a maturity of 90
days or less. The fund seeks to maintain a constant net asset value of $1.00 per
share.
32
<PAGE>
ASSET ALLOCATION
Seligman Time Horizon/Harvester Series, Inc. is an asset-allocation type mutual
fund. It offers four different asset allocation funds that pursue their
investment objectives by allocating their assets among other mutual funds in the
Seligman Group.
Seligman Time Horizon 30 Fund
Seeks long-term capital appreciation by creating a portfolio of mutual funds
that invests in aggressive growth-oriented domestic and international equity
securities weighted toward small- and medium-capitalization companies.
Seligman Time Horizon 20 Fund
Seeks long-term capital appreciation by creating a portfolio of mutual funds
that invests in growth-oriented domestic and international equity securities,
with a more even weighting among small-, medium- and large-capitalization
companies than Seligman Time Horizon 30 Fund.
Seligman Time Horizon 10 Fund
Seeks capital appreciation by creating a portfolio of mutual funds that invests
in small-, medium- and large-capitalization domestic and international equity
securities as well as domestic fixed-income securities.
Seligman Harvester Fund
Seeks capital appreciation and preservation of capital with current income and
growth of income by creating a portfolio of mutual funds that invests in medium-
and large-capitalization domestic and international equity securities
supplemented by a larger allocation of fixed-income securities and cash than
Seligman Time Horizon 10 Fund.
33
<PAGE>
Financial Highlights
The tables below are intended to help you understand the financial performance
of each Fund's Classes for the past five years or, if less than five years, the
period of the Class's operations. Certain information reflects financial results
for a single share of a Class that was held throughout the periods shown. "Total
return" shows the rate that you would have earned (or lost) on an investment in
the Fund, assuming you reinvested all your dividends and capital gain
distributions. Total returns do not reflect any sales charges. Deloitte & Touche
LLP, independent auditors, have audited this information. Their report, along
with each Fund's financial statements, is included in the Funds' Annual Report,
which is available upon request.
EMERGING MARKETS FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
---------------------------------------- --------------------------------------
Year ended Year ended
October 31, 5/28/96(3) October 31, *5/28/96(3)
----------------------------- to ---------------------------- to
1999 1998 1997 10/31/96 1999 1998 1997 10/31/96
------- ------- ------- -------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period ....... $5.18 $7.34 $6.78 $7.14 $5.09 $7.27 $6.76 $7.14
------- ------- ------- -------- ------- ------- ------- --------
Income from investment operations:
Net investment loss ...................... (0.07) (0.01) (0.05) (0.02) (0.11) (0.06) (0.11) (0.04)
Net gains or losses on securities
(both realized and unrealized) ........ 1.87 (2.00) 1.05 (0.25) 1.83 (1.97) 1.06 (0.25)
Net gains or losses on foreign currency
transactions (both realized
and unrealized)(1) .................... (0.29) (0.15) (0.44) (0.09) (0.29) (0.15) (0.44) (0.09)
------- ------- ------- -------- ------- ------- ------- --------
Total from investment operations ........... 1.51 (2.16) 0.56 (0.36) 1.43 (2.18) 0.51 (0.38)
------- ------- ------- -------- ------- ------- ------- --------
Less distributions:
Dividends from net investment income ..... -- -- -- -- -- -- -- --
Distributions from capital gains ......... -- -- -- -- -- -- -- --
------- ------- ------- -------- ------- ------- ------- --------
Total distributions ........................ -- -- -- -- -- -- -- --
------- ------- ------- -------- ------- ------- ------- --------
Net asset value, end of period ............. $6.69 $5.18 $7.34 $6.78 $6.52 $5.09 $7.27 $6.76
======= ======= ======= ======== ======= ======= ======= ========
Total Return: .............................. 29.15% (29.43)% 8.26% (5.04)% 28.10% (29.99)% 7.54% (5.32)%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) ... $30,822 $24,294 $44,061 $19,864 $16,129 $16,031 $28,819 $10,541
Ratio of expenses to average net assets .... 2.58% 2.22% 2.27% 2.22%+ 3.33% 2.99% 3.04% 3.00%+
Ratio of net loss to average net assets .... (1.11)% (0.12)% (0.56)% (0.69)%+ (1.86)% (0.89)% (1.33)% (1.47)%+
Portfolio turnover rate .................... 136.94% 94.09% 84.09% 12.24% 136.94% 94.09% 84.09% 12.24%
Without expense reimbursement and/or
management fee waiver:(2)
Ratios:
Expenses to average net assets ........... 3.02%+ 3.80%+
Net investment loss to average net assets (1.49)%+ (2.27)%+
</TABLE>
- ----------
See footnotes on page 39.
34
<PAGE>
EMERGING MARKETS FUND
<TABLE>
<CAPTION>
CLASS C CLASS D
---------- -------------------------------------------------------
Year ended
5/27/99(3) October 31, 5/28/96(3)
to ---------------------------------------- to
10/31/99 1999 1998 1997 10/31/96
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period .............. $6.14 $5.09 $7.27 $6.76 $7.14
---------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment loss ............................. (0.07) (0.11) (0.06) (0.11) (0.04)
Net gains or losses on securities
(both realized and unrealized) ............... 0.48 1.83 (1.97) 1.06 (0.25)
Net gains or losses on foreign currency
transactions (both realized and unrealized)(1) (0.03) (0.29) (0.15) (0.44) (0.09)
---------- ---------- ---------- ---------- ----------
Total from investment operations .................. 0.38 1.43 (2.18) 0.51 (0.38)
---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends from net investment income ............ -- -- -- -- --
Distributions from capital gains ................ -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Total distributions ............................... -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Net asset value, end of period .................... $6.52 $6.52 $5.09 $7.27 $6.76
========== ========== ========== ========== ==========
Total Return: 6.19% 28.10% (29.99)% 7.54% (5.32)%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) .......... $307 $12,854 $13,667 $31,259 $13,664
Ratio of expenses to average net assets ........... 3.37%+ 3.33% 2.99% 3.04% 3.00%+
Ratio of net loss to average net assets ........... (2.05)%+ (1.86)% (0.89)% (1.33)% (1.47)%+
Portfolio turnover rate ........................... 136.94%+++ 136.94% 94.09% 84.09% 12.24%
Without expense reimbursement and/or
management fee waiver:(2)
Ratios:
Expenses to average net assets .................. 3.80%+
Net investment loss to average net assets ....... (2.27)%+
</TABLE>
- ----------
See footnotes on page 39.
35
<PAGE>
GLOBAL GROWTH FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
------------------------------------------ ---------------------------------------
Year ended Year ended
October 31, 11/1/95(3) October 31, 4/22/96(3)
------------------------------ to ----------------------------- to
1999 1998 1997 10/31/96 1999 1998 1997 10/31/96
-------- ------- -------- -------- ------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period ..... $9.62 $9.20 $8.08 $7.14 $9.40 $9.06 $8.02 $8.04
-------- ------- -------- -------- ------- -------- ------- -------
Income from investment operations:
Net investment loss .................... (0.07) (0.05) (0.05) (0.03) (0.14) (0.12) (0.12) (0.04)
Net gains or losses on securities
(both realized and unrealized) ...... 3.51 0.81 1.47 1.12 3.41 0.80 1.46 0.06
Net gains or losses on foreign currency
transactions (both realized
and unrealized)(1) .................. (0.20) 0.08 (0.30) (0.15) (0.20) 0.08 (0.30) (0.04)
-------- ------- -------- -------- ------- -------- ------- -------
Total from investment operations ......... 3.24 0.84 1.12 0.94 3.07 0.76 1.04 (0.02)
-------- ------- -------- -------- ------- -------- ------- -------
Less distributions:
Dividends from net investment income ... -- -- -- -- -- -- -- --
Distributions from capital gains ....... -- (0.42) -- -- -- (0.42) -- --
------- -------- -------- ------- -------- ------- -------
Total distributions ...................... -- (0.42) -- -- -- (0.42) -- --
------- -------- -------- ------- -------- ------- -------
Net asset value, end of period ........... $12.86 $9.62 $9.20 $8.08 $12.47 $9.40 $9.06 $8.02
======== ======= ======== ======== ======= ======== ======= =======
Total Return: 33.68% 9.52% 13.86% 13.17% 32.66% 8.76% 12.97% (0.25)%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) . $120,946 $97,947 $109,060 $107,509 $35,344 $21,930 $19,311 $9,257
Ratio of expenses to average net assets .. 1.69% 1.68% 1.69% 1.91% 2.44% 2.44% 2.45% 2.53%+
Ratio of net loss to average net assets .. (0.54)% (0.48)% (0.59)% (0.53)% (1.29)% (1.24)% (1.35)% (1.13)%+
Portfolio turnover rate .................. 65.16% 45.43% 79.32% 31.44% 65.16% 45.43% 79.32% 31.44%++
<CAPTION>
CLASS C CLASS D
---------- ----------------------------------------
Year ended
5/27/99(3) October 31, 11/1/95(3)
to ---------------------------------------- to
10/31/99 1999 1998 1997 10/31/96
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period .............. $10.99 $9.40 $9.06 $8.02 $7.14
---------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment loss ............................. (0.07) (0.14) (0.12) (0.12) (0.09)
Net gains or losses on securities
(both realized and unrealized) ............... 1.43 3.41 0.80 1.46 1.12
Net gains or losses on foreign currency
transactions (both realized and unrealized)(1) 0.12 (0.20) 0.08 (0.30) (0.15)
---------- ---------- ---------- ---------- ----------
Total from investment operations .................. 1.48 3.07 0.76 1.04 0.88
---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends from net investment income ............ -- -- -- -- --
Distributions from capital gains ................ -- -- (0.42) -- --
---------- ---------- ---------- ---------- ----------
Total distributions ............................... -- -- (0.42) -- --
---------- ---------- ---------- ---------- ----------
Net asset value, end of period .................... $12.47 $12.47 $9.40 $9.06 $8.02
========== ========== ========== ========== ==========
Total Return: 13.47% 32.66% 8.76% 12.97% 12.33%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) .......... $1,046 $77,616 $64,443 $64,300 $53,540
Ratio of expenses to average net assets ........... 2.43%+ 2.44% 2.44% 2.45% 2.67%
Ratio of net loss to average net assets ........... (1.18)%+ (1.29)% (1.24)% (1.35)% (1.25)%
Portfolio turnover rate ........................... 65.16%+++ 65.16% 45.43% 79.32% 31.44%
</TABLE>
- ----------
See footnotes on page 39.
36
<PAGE>
GLOBAL SMALLER COMPANIES FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
-------------------------------------------------- ----------------------------------------
Year ended
Year ended October 31, October 31, 4/22/96(3)
-------------------------------------------------- ----------------------------- to
1999 1998 1997 1996 1995 1999 1998 1997 10/31/96
-------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning
of period ........................ $14.11 $15.62 $15.14 $13.90 $11.93 $13.46 $15.04 $14.72 $14.44
-------- -------- -------- -------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment loss ............. (0.10) (0.07) -- -- (0.02) (0.20) (0.18) (0.11) (0.06)
Net gains or losses on securities
(both realized and unrealized) 1.94 (0.85) 1.61 2.38 2.24 1.85 (0.81) 1.56 0.33
Net gains or losses on foreign
currency transactions (both
realized and unrealized)(1) ... (0.21) 0.04 (0.40) (0.18) 0.08 (0.21) 0.04 (0.40) 0.01
-------- -------- -------- -------- -------- -------- -------- -------- --------
Total from investment operations .. 1.63 (0.88) 1.21 2.20 2.30 1.44 (0.95) 1.05 0.28
-------- -------- -------- -------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net
investment income ............ -- -- -- -- -- -- -- -- --
Distributions from capital gains -- (0.63) (0.73) (0.96) (0.33) -- (0.63) (0.73) --
-------- -------- -------- -------- -------- -------- -------- -------- --------
Total distributions ............... -- (0.63) (0.73) (0.96) (0.33) -- (0.63) (0.73) --
-------- -------- -------- -------- -------- -------- -------- -------- --------
Net asset value, end of period .... $15.74 $14.11 $15.62 $15.14 $13.90 $14.90 $13.46 $15.04 $14.72
======== ======== ======== ======== ======== ======== ======== ======== ========
Total Return: 11.55% (5.82)% 8.28% 16.95% 20.10% 10.70% (6.54)% 7.39% 1.94%
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) .................. $213,729 $374,890 $434,397 $350,359 $102,479 $155,345 $222,496 $247,600 $103,968
Ratio of expenses to
average net assets .............. 1.72% 1.65% 1.67% 1.75% 1.83% 2.47% 2.41% 2.43% 2.54%+
Ratio of net income (loss) to
average net assets .............. (0.69)% (0.45)% 0.02% 0.01% (0.20)% (1.44)% (1.21)% (0.74)% (0.80)%+
Portfolio turnover rate ........... 61.31% 50.81% 57.24% 45.38% 63.05% 61.31% 50.81% 57.24% 45.38%++
<CAPTION>
CLASS C CLASS D
----------- -------------------------------------------------------------------------
5/27/99(3) Year ended October 31,
to -------------------------------------------------------------------------
10/31/99 1999 1998 1997 1996 1995
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period . $13.86 $13.47 $15.05 $14.72 $13.63 $11.80
----------- ----------- ----------- ----------- ----------- -----------
Income from investment operations:
Net investment loss ................ (0.06) (0.20) (0.18) (0.11) (0.11) (0.12)
Net gains or losses on securities
(both realized and unrealized) ... 0.98 1.85 (0.81) 1.57 2.34 2.20
Net gains or losses on foreign
currency transactions (both
realized and unrealized)(1) ...... 0.13 (0.21) 0.04 (0.40) (0.18) 0.08
----------- ----------- ----------- ----------- ----------- -----------
Total from investment operations ..... 1.05 1.44 (0.95) 1.06 2.05 2.16
----------- ----------- ----------- ----------- ----------- -----------
Less Distributions:
Dividends from net investment income -- -- -- -- -- --
Distributions from capital gains ... -- -- (0.63) (0.73) (0.96) (0.33)
----------- ----------- ----------- ----------- ----------- -----------
Total distributions .................. -- -- (0.63) (0.73) (0.96) (0.33)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value, end of period ....... $14.91 $14.91 $13.47 $15.05 $14.72 $13.63
=========== =========== =========== =========== =========== ===========
Total Return: 7.58% 10.69% (6.53)% 7.47% 16.14% 19.11%
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) ..................... $363 $162,220 $272,992 $370,625 $285,477 $85,548
Ratio of expenses to
average net assets ................. 2.47%+ 2.47% 2.41% 2.43% 2.51% 2.61%
Ratio of net loss to
average net assets ................. (1.20)%+ (1.44)% (1.21)% (0.74)% (0.75)% (0.97)%
Portfolio turnover rate .............. 61.31%+++ 61.31% 50.81% 57.24% 45.38% 63.05%
</TABLE>
- ----------
See footnotes on page 39
37
<PAGE>
GLOBAL TECHNOLOGY FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
---------------------------------------------------- -----------------------------
Year ended October 31, Year ended October 31, 4/22/96(3)
---------------------------------------------------- ----------------------------- to
1999 1998 1997 1996 1995 1999 1998 1997 10/31/96
-------- -------- -------- -------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period $12.48 $15.14 $11.31 $13.05 $8.37 $11.98 $14.73 $11.09 $11.47
-------- -------- -------- -------- -------- -------- ------- -------- -------
Income from investment operations:
Net investment loss .............. (0.19) (0.14) (0.16) (0.08) (0.10) (0.31) (0.23) (0.26) (0.08)
Net gains or losses on securities
(both realized and unrealized) . 11.26 0.01 4.06 (0.92) 4.90 10.78 0.01 3.97 (0.39)
Net gains or losses on foreign
currency transactions (both
realized and unrealized)(1) .... (0.03) 0.06 (0.07) 0.05 (0.05) (0.03) 0.06 (0.07) 0.09
-------- -------- -------- -------- -------- -------- ------- -------- -------
Total from investment operations ... 11.04 (0.07) 3.83 (0.95) 4.75 10.44 (0.16) 3.64 (0.38)
-------- -------- -------- -------- -------- -------- ------- -------- -------
Less distributions:
Dividends from net
investment income -- -- -- (0.02) -- -- -- -- --
Distributions from capital gains . (0.16) (2.59) -- (0.77) (0.07) (0.16) (2.59) -- --
-------- -------- -------- -------- -------- -------- ------- -------- -------
Total distributions ................ (0.16) (2.59) -- (0.79) (0.07) (0.16) (2.59) -- --
-------- -------- -------- -------- -------- -------- ------- -------- -------
Net asset value, end of period ..... $23.36 $12.48 $15.14 $11.31 $13.05 $22.26 $11.98 $14.73 $11.09
======== ======== ======== ======== ======== ======== ======= ======== =======
Total Return: 89.40% (0.79)% 33.86% (7.33)% 57.31% 88.10% (1.55)% 32.82% (3.31)%
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) ..................$795,234 $475,951 $583,257 $499,858 $447,732 $118,262 $58,575 $53,046 $18,840
Ratio of expenses to average
net assets ...................... 1.59% 1.67% 1.67% 1.75% 1.91% 2.34% 2.43% 2.42% 2.51%+
Ratio of net loss to average
net assets ...................... (1.10)% (1.04)% (1.10)% (0.74)% (0.89)% (1.85)% (1.80)% (1.85)% (1.40)%+
Portfolio turnover rate ............ 91.12% 87.55% 94.06% 73.00% 87.42% 91.12% 87.55% 94.06% 73.00%++
<CAPTION>
CLASS C CLASS D
--------- -----------------------------------------------------------------
5/27/99(3) Year ended October 31,
to -----------------------------------------------------------------
10/31/99 1999 1998 1997 1996 1995
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period ... $16.22 $11.96 $14.73 $11.09 $12.89 $8.34
--------- --------- --------- --------- --------- ---------
Income from investment operations:
Net investment loss .................. (0.13) (0.31) (0.23) (0.26) (0.17) (0.18)
Net gains or losses on securities
(both realized and unrealized) ..... 5.92 10.77 (0.01) 3.97 (0.91) 4.85
Net gains or losses on foreign
currency transactions (both
realized and unrealized)(1) ........ 0.22 (0.03) 0.06 (0.07) 0.05 (0.05)
Total from investment operations ....... 6.01 10.43 (0.18) 3.64 (1.03) 4.62
--------- --------- --------- --------- --------- ---------
Less Distributions:
Dividends from net investment income . -- -- -- -- -- --
Distributions from capital gains ..... -- (0.16) (2.59) -- (0.77) (0.07)
--------- --------- --------- --------- --------- ---------
Total distributions .................... -- (0.16) (2.59) -- (0.77) (0.07)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period ......... $22.23 $22.23 $11.96 $14.73 $11.09 $12.89
========= ========= ========= ========= ========= =========
Total Return: 37.05% 88.17% (1.70)% 32.82% (8.07)% 55.95%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) $6,377 $300,969 $184,032 $232,882 $197,412 $161,622
Ratio of expenses to average net assets 2.23%+ 2.34% 2.43% 2.42% 2.52% 2.66%
Ratio of net loss to average net assets (1.72)%+ (1.85)% (1.80)% (1.85)% (1.50)% (1.63)%
Portfolio turnover rate ................ 91.12%+++ 91.12% 87.55% 94.06% 73.00% 87.42%
</TABLE>
38
<PAGE>
INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
-------------------------------------------------------------------------------
Year ended
Year ended October 31, October 31, *4/22/96(3)
------------------------------------------------------------------------------- to
1999 1998 1997 1996 1995 1999 1998 1997 10/31/96
------- ------- ------- ------- ------- ------- ------ ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period . $17.75 $17.92 $17.17 $16.71 $17.67 $16.93 $17.30 $16.74 $17.38
------- ------- ------- ------- ------- ------- ------ ------ ------
Income from investment operations:
Net investment income (loss) ....... (0.01) 0.03 (0.04) 0.05 0.06 (0.15) (0.12) (0.18) (0.03)
Net gains or losses on securities
(both realized and unrealized) ... 4.49 0.62 2.47 1.77 (0.42) 4.31 0.57 2.42 (0.54)
Net gains or losses on foreign
currency transactions (both
realized and unrealized)(1) ...... (0.76) 0.40 (0.79) (0.44) 0.09 (0.76) 0.40 (0.79) (0.07)
------- ------- ------- ------- ------- ------- ------ ------ ------
Total from investment operations ..... 3.72 1.05 1.64 1.38 (0.27) 3.40 0.85 1.45 (0.64)
------- ------- ------- ------- ------- ------- ------ ------ ------
Less distributions:
Dividends from net
investment income ................ -- -- -- -- -- -- -- -- --
Distributions from capital gains ... -- (1.22) (0.89) (0.92) (0.69) -- (1.22) (0.89) --
------- ------- ------- ------- ------- ------- ------ ------ ------
Total distributions .................. -- (1.22) (0.89) (0.92) (0.69) -- (1.22) (0.89) --
------- ------- ------- ------- ------- ------- ------ ------ ------
Net asset value, end of period ....... $21.47 $17.75 $17.92 $17.17 $16.71 $20.33 $16.93 $17.30 $16.74
======= ======= ======= ======= ======= ======= ====== ====== ======
Total Return: 20.96% 6.51% 9.83% 8.43% (1.24)% 20.08% 5.51% 8.90% (3.68)%
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) ................... $44,763 $44,122 $46,107 $50,998 $48,763 $11,434 $9,835 $6,350 $2,843
Ratio of expenses to
average net assets ............... 1.88% 1.69% 1.78% 1.81% 1.69% 2.64% 2.55% 2.58% 2.66%+
Ratio of net income (loss) to
average net assets ............... (0.06)% 0.16% (0.23)% 0.28% 0.35% (0.82)% (0.70)% (1.03)% (0.35)%+
Portfolio turnover rate .............. 83.10% 81.37% 83.11% 55.71% 60.70% 83.10% 81.37% 83.11% 55.71%++
</TABLE>
<TABLE>
<CAPTION>
CLASS C CLASS D
---------- ---------------------------------------------------------------
5/27/99(3) Year ended October 31,
to ---------------------------------------------------------------
10/31/99 1999 1998 1997 1996 1995
------ ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data:*
Net asset value, beginning of period .... $18.39 $16.93 $17.30 $16.74 $16.43 $17.53
------ ------- ------- ------- ------- -------
Income from investment operations:
Net investment loss ................... (0.10) (0.15) (0.12) (0.18) (0.08) (0.07)
Net gains or losses on securities
(both realized and unrealized) ...... 1.66 4.29 0.57 2.42 1.75 (0.43)
Net gains or losses on foreign currency
transactions (both realized
and unrealized)(1) ................ 0.36 (0.76) 0.40 (0.79) (0.44) 0.09
------ ------- ------- ------- ------- -------
Total from investment operations ........ 1.92 3.38 0.85 1.45 1.23 (0.41)
------ ------- ------- ------- ------- -------
Less Distributions:
Dividends from net investment income .. -- -- -- -- -- --
Distributions from capital gains ...... -- -- (1.22) (0.89) (0.92) (0.69)
Total distributions ..................... -- -- (1.22) (0.89) (0.92) (0.69)
------ ------- ------- ------- ------- -------
Net asset value, end of period .......... $20.31 $20.31 $16.93 $17.30 $16.74 $16.43
====== ======= ======= ======= ======= =======
Total Return: 10.44% 19.97% 5.51% 8.90% 7.62% (2.08)%
Ratios/Supplemental Data:
Net assets, end of period (in thousands) $1,361 $35,728 $37,485 $40,977 $47,917 $31,273
Ratio of expenses to average net assets . 2.72%+ 2.64% 2.55% 2.58% 2.64% 2.50%
Ratio of net loss to average net assets . (1.07)%+ (0.82)% (0.70)% (1.03)% (0.47)% (0.44)%
Portfolio turnover rate ................. 83.10%+++ 83.10% 81.37% 83.11% 55.71% 60.70%
Without expense reimbursement and/or
management fee waiver:(2)
Ratios:
Expenses to average net assets ............................................................................... 2.62%
Net investment loss to average net assets .................................................................... (0.56)%
</TABLE>
- ----------
* Per share amounts are calculated based on average shares outstanding.
(1) The Fund separates the portion of its investment operations that resulted
from changes in foreign exchange rates from the portion that resulted from
changes in the market price of securities held and/or sold by the Fund.
(2) Seligman and Seligman Henderson Co., (subadviser to the Fund until 7/1/98)
at their discretion, waived a portion of their fees and, in some cases,
Seligman Henderson Co. reimbursed certain expenses for the periods
presented. There is no assurance that Seligman will continue this policy in
the future.
(3) Commencement of offering of shares.
+ Annualized.
++ For the year ended October 31, 1996.
+++ For the year ended October 31, 1999.
39
<PAGE>
How to Contact Us
The Fund Write: Corporate Communications/
Investor Relations Department
J. & W. Seligman & Co. Incorporated
100 Park Avenue, New York, NY 10017
Phone: Toll-Free (800) 221-7844 in the US or
(212) 850-1864 outside the US
Website: http://www.seligman.com
Your Regular
(Non-Retirement)
Account Write: Shareholder Services Department
Seligman Data Corp.
100 Park Avenue, New York, NY 10017
Phone: Toll-Free (800) 221-2450 in the US or
(212) 682-7600 outside the US
Website: http://www.seligman.com
Your Retirement
Account Write: Retirement Plan Services
Seligman Data Corp.
100 Park Avenue, New York, NY 10017
Phone: Toll-Free (800) 445-1777
- --------------------------------------------------------------------------------
24-hour automated telephone access is available by dialing (800) 622-4597 on a
touchtone telephone. You will have instant access to price, yield, account
balance, most recent transaction, and other information.
- --------------------------------------------------------------------------------
40
<PAGE>
================================================================================
For More Information
- --------------------------------------------------------------------------------
The following information is available without charge upon request: Call
toll-free (800) 221-2450 in the US or collect (212) 682-7600 outside the US. You
may also call these numbers to request other information about the Funds or to
make shareholder inquiries.
Statement of Additional Information (SAI) contains additional information about
the Funds. It is on file with the Securities and Exchange Commission, or SEC,
and is incorporated by reference into (is legally part of) this prospectus.
Annual/Semi-Annual Reports contain additional information about each Fund's
investments. In the Funds' annual report, you will find a discussion of the
market conditions and investment strategies that significantly affected each
Fund's performance during its last fiscal year.
- --------------------------------------------------------------------------------
SELILGMAN ADVISORS, INC.
an affiliate of
[LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 Park Avenue, New York, NY 10017
Information about the Funds, including the SAI, can be viewed and copied at the
SEC's Public Reference Room in Washington, DC. The SAI, Annual/Semi-Annual
reports and other information about the Funds are also available on the EDGAR
Database on the SEC's Internet site: http://www.sec.gov. For information about
the operation of the Public Reference Room, call (202) 942-8090.
Copies of this information may be obtained, upon payment of a duplicating fee,
by electronic request at the following E-mail address: [email protected], or by
writing: Securities and Exchange Commission, Public Reference Section,
Washington, DC 20549-0102.
SEC FILE NUMBER: 811-6485
================================================================================
<PAGE>
SELIGMAN GLOBAL FUND SERIES, INC.
Seligman Emerging Markets Fund
Seligman Global Growth Fund
Seligman Global Smaller Companies Fund
Seligman Global Technology Fund
Seligman International Growth Fund
Statement of Additional Information
March 1, 2000
100 Park Avenue
New York, New York 10017
(212) 850-1864
Toll Free Telephone: (800) 221-2450
For Retirement Plan Information - Toll-Free Telephone: (800) 445-1777
This Statement of Additional Information (SAI) expands upon and supplements the
information contained in the current Prospectus of Seligman Global Fund Series,
Inc., dated March 1, 2000. This SAI, although not in itself a prospectus, is
incorporated by reference into the Prospectus in its entirety. It should be read
in conjunction with the Prospectus, which you may obtain by writing or calling
the Funds at the above address or telephone numbers.
The financial statements and notes included in the Funds' Annual Report, and the
Independent Auditors' Report thereon, are incorporated herein by reference. The
Annual Report will be furnished to you without charge if you request a copy of
this SAI.
Table of Contents
Fund History .................................................... 2
Description of the Funds and their Investments and Risks ........ 2
Management of the Funds ......................................... 10
Control Persons and Principal Holders of Securities ............. 15
Investment Advisory and Other Services .......................... 17
Brokerage Allocation and Other Practices ........................ 25
Capital Stock and Other Securities .............................. 26
Purchase, Redemption, and Pricing of Shares ..................... 26
Taxation of the Funds ........................................... 32
Underwriters .................................................... 34
Calculation of Performance Data ................................. 36
Financial Statements ............................................ 41
General Information ............................................. 41
Appendix A ...................................................... 43
Appendix B ...................................................... 46
EQSHG1A
<PAGE>
Fund History
Seligman Global Fund Series, Inc. was incorporated in Maryland on November 22,
1991 under the name Seligman International Fund Series, Inc. It changed its name
to Seligman Henderson Global Fund Series, Inc. on May 25, 1993, and changed its
name to its present name on January 21, 2000.
Description of the Funds and their Investments and Risks
Classification
Seligman Global Fund Series, Inc. is a diversified, open-end management
investment company, or mutual fund. It consists of five separate and distinct
series, or funds:
Seligman Emerging Markets Fund (Emerging Markets Fund)
(formerly known as Seligman Henderson Emerging Markets Growth Fund)
Seligman Global Growth Fund (Global Growth Fund)
(formerly known as Seligman Henderson Global Growth Opportunities Fund)
Seligman Global Smaller Companies Fund (Global Smaller Companies Fund)
(formerly known as Seligman Henderson Global Smaller Companies Fund)
Seligman Global Technology Fund (Global Technology Fund)
(formerly known as Seligman Henderson Global Technology Fund)
Seligman International Growth Fund (International Growth Fund)
(formerly known as Seligman Henderson International Fund)
Investment Strategies and Risks
The following information regarding the Funds' investments and risks supplements
the information contained in the Prospectus.
General. In allocating each Fund's investments among geographic regions and
individual countries, the investment manager will consider such factors as the
relative economic growth potential of the various economies and securities
markets; expected levels of inflation; financial, social and political
conditions influencing investment opportunities; and the outlook for currency
relationships.
Each Fund may invest in all types of securities, many of which will be
denominated in currencies other than the US dollar. Each Fund will normally
invest its assets in equity securities, including common stock, securities
convertible into or exchangeable for common stock, depositary receipts, and
warrants. A Fund may, however, invest up to 25% of its assets in preferred stock
and debt securities. A Fund that invests "primarily" in a certain type of
security invests at least 65% of its total assets in that type of security.
Dividends or interest income are considered only when the investment manager
believes that such income will favorably influence the market value of a
security in light of each Fund's objective of capital appreciation. Equity
securities in which each Fund invests may be listed on a US or foreign stock
exchanges or traded in US or foreign over-the-counter markets.
Debt securities in which each Fund may invest are not required to be rated by a
recognized rating agency. As a matter of policy, each Fund, with the exception
of the Emerging Markets Fund, will invest only in "investment-grade" debt
securities or, in the case of unrated securities, debt securities that are, in
the opinion of the investment manager, of equivalent quality to
"investment-grade" securities. "Investment-grade" debt securities are rated
within the four highest rating categories as determined by Moody's Investors
Service (Moody's) or Standard & Poor's Ratings Services (S&P). Securities rated
within the highest of the four investment-grade categories (i.e., Aaa by Moody's
and AAA by S&P) are judged to be of the best quality and carry the smallest
degree of risk. For capital appreciation, the Emerging Markets Fund may invest
up to 5% of its assets in governmental and corporate debt securities that, at
the time of purchase by the Fund, are rated Baa or lower by Moody's and BBB or
lower by S&P or, if unrated, deemed by the investment manager to be of
comparable quality. The Emerging Markets Fund will not invest in debt securities
rated lower than C by Moody's or C by S&P or, if unrated, deemed by the
investment manager to be of comparable quality. Securities rated Baa/BBB or
lower lack high quality investment characteristics and may also have speculative
characteristics. (Appendix A to the Statement of Additional Information contains
a description of these rating categories.) Debt securities are
2
<PAGE>
interest-rate sensitive, so their value tends to decrease when interest rates
rise and increase when interest rates fall.
Each Fund may invest in securities represented by European Depositary Receipts
(EDRs), American Depositary Receipts (ADRs) and Global Depositary Receipts
(GDRs) (collectively, Depositary Receipts). ADRs are receipts generally issued
by a domestic bank or trust company that represent the deposit of a security of
a foreign issuer. ADRs may be publicly traded on exchanges or over-the-counter
in the United States and are quoted and settled in US dollars at a price that
generally reflects the US dollar equivalent of the home country share price.
EDRs and GDRs are receipts similar to ADRs and are typically issued by foreign
banks or trust companies and traded in Europe. Depositary Receipts may be issued
as sponsored or unsponsored programs. In sponsored programs, the issuer has made
arrangements to have its securities traded in the form of a Depositary Receipt.
In unsponsored programs, the issuer may not be directly involved in the creation
of the program. Although regulatory requirements with respect to sponsored and
unsponsored programs are generally similar, the issuers of unsponsored
Depositary Receipts are not obligated to disclose material information in the
United States and, therefore, the import of such information may not be
reflected in the market value of such securities. For purposes of a Fund's
investment policies, an investment in Depositary Receipts will be deemed to be
an investment in the underlying security.
By investing in foreign securities, a Fund will attempt to take advantage of
differences among economic trends and the performance of securities markets in
various countries. To date, the market values of securities of issuers located
in different countries have moved relatively independently of each other,
although markets in certain regions tend to move in the same direction. During
certain periods, the return on equity investments in some countries has exceeded
the return on similar investments in the United States. The investment manager
believes that, in comparison with investment companies investing solely in
domestic securities, it may be possible to obtain significant appreciation from
a portfolio of foreign investments and securities from various markets that
offer different investment opportunities and are affected by different economic
trends. International and global diversification reduces the effect events in
any one country will have on a Fund's entire investment portfolio. Of course, a
decline in the value of a Fund's investments in one country may offset potential
gains from investments in another country.
Foreign Investment Risk Factors. Investments in securities of foreign issuers
may involve risks that are not associated with domestic investments, and there
can be no assurance that a Fund's foreign investments will present less risk
than a portfolio of domestic securities. Foreign issuers may lack uniform
accounting, auditing and financial reporting standards, practices and
requirements, and there is generally less publicly available information about
foreign issuers than there is about US issuers. Governmental regulation and
supervision of foreign stock exchanges, brokers and listed companies may be less
pervasive than is customary in the United States. Securities of some foreign
issuers are less liquid, and their prices are more volatile than securities of
comparable domestic issuers. Foreign securities settlement practices may in some
instances be subject to delays and related administrative uncertainties which
could result in temporary periods when assets of a Fund are uninvested and no
return is earned thereon and may involve a risk of loss to a Fund. Foreign
securities markets may have substantially less trading volume than US markets
and far fewer traded issues. Fixed brokerage commissions on foreign securities
exchanges are generally higher than in the United States and transaction costs
with respect to smaller capitalization companies may be higher than those of
larger capitalization companies. Income from foreign securities may be reduced
by a withholding tax at the source or other foreign taxes. In some countries,
there may also be the possibility of expropriation or confiscatory taxation (in
which case a Fund could lose its entire investment in a certain market);
limitations on the removal of moneys or other assets of a Fund; political or
social instability or revolution; or diplomatic developments that could affect
investments in those countries. In addition, it may be difficult to obtain and
enforce a judgment in a court outside the United States.
Each Fund may invest in sovereign debt. The actions of governments concerning
their respective economies could have an important effect on their ability or
willingness to service their sovereign debt. Such actions could have significant
effects on market conditions and on the prices of securities and instruments
held by a Fund, including the securities and instruments of foreign private
issuers. Factors which may influence the ability or willingness of foreign
sovereigns to service debt include, but are not limited to: the availability of
sufficient foreign exchange on the date payment is due; the relative size of its
debt service burden to the economy as a whole; its balance of payments
(including export performance) and cash flow situation; its access to
international credits and investments; fluctuations in interest and currency
rates and reserves; and its government's policies towards the International
Monetary Fund, the World Bank and other international agencies. If a foreign
sovereign
3
<PAGE>
defaults on all or a portion of its foreign debt, a Fund may have limited legal
recourse against the issuer and/or guarantor. In some cases, remedies must be
pursued in the courts of the defaulting party itself, and the ability of the
holder of foreign sovereign debt securities to obtain recourse may be subject to
the political climate in the prevailing country.
Foreign Currency Risk Factors. Investments in foreign securities will usually be
denominated in foreign currency, and each Fund may be affected, favorably or
unfavorably, by the relative strength of the US dollar, changes in foreign
currency and US dollar exchange rates, and exchange control regulations. A Fund
may incur costs in connection with conversions between various currencies. A
Fund's net asset value per share will be affected by changes in currency
exchange rates. Changes in foreign currency exchange rates may also affect the
value of dividends and interest earned, gains and losses realized on the sale of
securities, and net investment income and gains, if any, to be distributed to
shareholders by a Fund. The rate of exchange between the US dollar and other
currencies is generally determined by the forces of supply and demand in the
foreign exchange markets (which in turn are affected by interest rates, trade
flow, and numerous other factors, including, in some countries, local
governmental intervention), but can sometimes be affected by the imposition of
fixed exchange rates that may overvalue a foreign currency, to the detriment of
foreign investors.
Emerging Market Investment Risk Factors. Some of the risks described in the
preceding paragraphs may be more severe for investments in emerging countries.
By comparison with the United States and other developed countries, emerging
countries may have relatively unstable governments, economies based on a less
diversified industrial base and securities markets that trade a smaller number
of securities. Companies in emerging markets may generally be smaller, less
seasoned and more recently organized than many domestic companies. Prices of
securities traded in the securities markets of emerging countries tend to be
volatile. Furthermore, foreign investors are subject to many restrictions in
emerging countries. These restrictions may require, among other things,
governmental approval prior to making investments or repatriating income or
capital or the payment of special levies and taxes, or may impose limits on the
amount or type of securities held by foreigners or on the companies in which the
foreigners may invest.
The economies of individual emerging countries may differ favorably or
unfavorably from the US economy in such respects as growth of gross domestic
product, rates of inflation, currency depreciation, capital reinvestment,
resource self-sufficiency, and balance of payment position and may be based on a
substantially less diversified industrial base. Further, the economies of
emerging countries generally are heavily dependent upon international trade and,
accordingly, have been, and may continue to be, adversely affected by trade
barriers, exchange controls, managed adjustments in relative currency values,
and other protectionist measures imposed or negotiated by the countries with
which they trade. These economies also have been, and may continue to be,
adversely affected by economic conditions in the countries with which they
trade.
Smaller Company Investment Risk Factors. The investment manager believes that
smaller companies generally have greater earnings and sales growth potential
than larger companies. However, investments in such companies may involve
greater risks, such as limited product lines, limited markets and limited
financial or managerial resources. Less frequently traded securities may be
subject to more abrupt price movements than securities of larger companies.
Technology Investment Risk Factors. The value of Global Technology Fund shares
may be susceptible to factors affecting technology and technology-related
industries and to greater risk and market fluctuation than an investment in a
fund that invests in a broader range of portfolio securities. Technology and
technology-related industries may be subject to greater governmental regulation
than many other industries in certain countries, as well as changes in
governmental policies, and the need for regulatory approvals may have a material
adverse effect on these industries. Additionally, these companies may be subject
to risks of developing technologies, competitive pressures, and other factors
and are dependent upon consumer and business acceptance as new technologies
evolve. Securities of smaller, less experienced companies also may involve
greater risks, such as limited product lines, limited markets and limited
financial or managerial resources, and trading in such securities may be subject
to more abrupt price movements than trading in the securities of larger
companies.
Derivatives. Each Fund may invest in financial instruments commonly known as
"derivatives" only for hedging or investment purposes. A Fund will not invest in
derivatives for speculative purposes, which means where the derivative
investment exposes the Fund to undue risk of loss, such as where the risk of
loss is greater than the cost of the investment.
4
<PAGE>
A derivative is generally defined as an instrument whose value is derived from,
or based upon, some underlying index, reference rate (e.g., interest rates or
currency exchange rates), security, commodity, or other asset. A Fund will not
invest in a specific type of derivative without prior approval from the Funds'
Board of Directors after consideration of, among other things, how the
derivative instrument serves the Fund's investment objective, and the risks
associated with the investment. The only types of derivatives in which each Fund
is currently permitted to invest are forward foreign currency exchange
contracts, stock purchase rights and warrants, and put options.
Forward Foreign Currency Exchange Contracts. The investment manager will
consider changes in exchange rates in making investment decisions. As one way of
managing exchange rate risk, each Fund may enter into forward currency exchange
contracts. A forward foreign currency exchange contract is an agreement to
purchase or sell a specific currency at a future date and at a price set at the
time the contract is entered into. A Fund will usually enter into these
contracts to fix the US dollar value of a security that it has agreed to buy or
sell for the period between the date the trade was entered into and the date the
security is delivered and paid for. A Fund may also use these contracts to hedge
the US dollar value of securities it already owns. A Fund may be required to
cover certain forward currency contract positions by establishing a segregated
account with its custodian that will contain only liquid assets, such as US
Government securities or other liquid high-grade debt obligations.
A Fund may enter into a forward contract to sell or buy the amount of a foreign
currency it believes may experience a substantial movement against another
currency (including the US dollar). In this case the contract would approximate
the value of some or all of a Fund's portfolio securities denominated in such
foreign currency. If appropriate, a Fund may hedge all or part of its foreign
currency exposure through the use of a basket of currencies or a proxy currency
where such currencies or proxy currency act as an effective proxy for other
currencies. In these circumstances, a Fund may enter into a forward contract
where the amount of the foreign currency to be sold exceeds the value of the
securities denominated in such currency. The use of this basket hedging
technique may be more efficient and economical than entering into separate
forward contracts for each currency held in a Fund. The precise matching of the
forward contract amounts and the value of the securities involved will not
generally be possible since the future value of such securities in foreign
currencies will change as a consequence of market movement in the value of those
securities between the date the forward contract is entered into and the date it
matures. The projection of short-term currency market movement is extremely
difficult, and the successful execution of a short-term hedging strategy is
highly uncertain. Under certain circumstances, a Fund may commit a substantial
portion or the entire value of its assets to the consummation of these
contracts. The investment manager will consider the effect a substantial
commitment of its assets to forward contracts would have on the investment
program of each Fund and its ability to purchase additional securities.
Except as set forth above and immediately below, a Fund will also not enter into
such forward contracts or maintain a net exposure to such contracts where the
consummation of the contracts would oblige a Fund to deliver an amount of
foreign currency in excess of the value of such Fund's portfolio securities or
other assets denominated in that currency. A Fund, in order to avoid excess
transactions and transaction costs, may nonetheless maintain a net exposure to
forward contracts in excess of the value of its portfolio securities or other
assets denominated in that currency provided the excess amount is "covered" by
cash or liquid, high-grade debt securities, denominated in any currency, having
a value at least equal at all times to the amount of such excess. Under normal
circumstances, consideration of the prospect for currency parities will be
incorporated into the longer-term investment decisions made with regard to
overall diversification strategies. However, the investment manager believes
that it is important to have the flexibility to enter into such forward
contracts when it determines that the best interests of a Fund will be served.
At the maturity of a forward contract, a Fund may either sell the portfolio
security and make delivery of the foreign currency, or it may retain the
security and terminate its contractual obligation to deliver the foreign
currency by purchasing an "offsetting" contract obligating it to purchase, on
the same maturity date, the same amount of the foreign currency.
As indicated above, it is impossible to forecast with absolute precision the
market value of portfolio securities at the expiration of the forward contract.
Accordingly, it may be necessary for a Fund to purchase additional foreign
currency on the spot market (and bear the expense of such purchase) if the
market value of the security is less than the amount of foreign currency such
Fund is obligated to deliver and if a decision is made to sell the security and
make delivery of the foreign currency. Conversely, it may be necessary to sell
on the spot market
5
<PAGE>
some of the foreign currency received upon the sale of the portfolio security if
its market value exceeds the amount of foreign currency a Fund is obligated to
deliver. However, a Fund may use liquid, high-grade debt securities, denominated
in any currency, to cover the amount by which the value of a forward contract
exceeds the value of the securities to which it relates.
If a Fund retains the portfolio security and engages in an offsetting
transaction, such Fund will incur a gain or a loss (as described below) to the
extent that there has been movement in forward contract prices. If a Fund
engages in an offsetting transaction, it may subsequently enter into a new
forward contract to sell the foreign currency. Should forward prices decline
during the period between a Fund's entering into a forward contract for the sale
of a foreign currency and the date it enters into an offsetting contract for the
purchase of the foreign currency, such Fund will realize a gain to the extent
the price of the currency it has agreed to sell exceeds the price of the
currency it has agreed to purchase. Should forward prices increase, a Fund will
suffer a loss to the extent the price of the currency it has agreed to purchase
exceeds the price of the currency it has agreed to sell.
The Fund's dealing in forward foreign currency exchange contracts will generally
be limited to the transactions described above. However, each Fund reserves the
right to enter into forward foreign currency contracts for different purposes
and under different circumstances. Of course, a Fund is not required to enter
into forward contracts with regard to its foreign currency-denominated
securities and will not do so unless deemed appropriate by the investment
manager.
Although a Fund will seek to benefit by using forward contracts, anticipated
currency movements may not be accurately predicted and the Fund may therefore
incur a gain or loss on a forward contract. A forward contract may help reduce a
Fund's losses on securities denominated in foreign currency, but it may also
reduce the potential gain on the securities depending on changes in the
currency's value relative to the US dollar or other currencies. Additionally,
this method of hedging against a decline in the value of a currency does not
eliminate fluctuations in the underlying prices of the securities. It simply
establishes a rate of exchange at a future date. Foreign currency forward
contracts may not be available to a Fund on reasonable terms in many situations
and a Fund may frequently choose not to enter into such contracts even when they
are available.
Investors should be aware of the costs of currency conversion. Although foreign
exchange dealers do not charge a fee for conversion, they do realize a profit or
"spread" based on the difference between the prices at which they are buying and
selling various currencies. Thus, a dealer may offer to sell a foreign currency
to a Fund at one rate, while offering a lesser rate of exchange should the Fund
desire to resell that currency to the dealer.
Rights and Warrants. Each Fund may invest in common stock rights and warrants
believed by the investment manager to provide capital appreciation
opportunities. Common stock rights and warrants received as part of a unit or
attached to securities purchased (i.e., not separately purchased) are not
included in a Fund's investment restrictions regarding such securities.
A Fund may not invest in rights and warrants if, at the time of acquisition, the
investment in rights and warrants would exceed 5% of the Fund's net assets
(valued at the lower of cost or market). In addition, no more than 2% of net
assets of a Fund may be invested in warrants not listed on the New York or
American Stock Exchanges. For purposes of this restriction, rights and warrants
acquired by the Fund in units or attached to securities may be deemed to have
been purchased without cost.
Put Options. Each Fund may purchase put options on portfolio securities in an
attempt to provide a hedge against a decrease in the market price of an
underlying security held by the Fund. A Fund will not purchase options for
speculative purposes.
Purchasing a put option gives a Fund the right to sell, and obligates the writer
to buy, the underlying security at the exercise price at any time during the
option period. This hedge protection is provided during the life of the put
option since the Fund, as holder of the put option, can sell the underlying
security at the put exercise price regardless of any decline in the underlying
security's market price.
In order for a put option to be profitable, the market price of the underlying
security must decline sufficiently below the exercise price to cover the premium
and transaction costs. By using put options in this manner, a Fund will reduce
any profit it might otherwise have realized in the underlying security by the
premium paid for the put option and by transaction costs.
6
<PAGE>
Because a purchased put option gives the purchaser a right and not an
obligation, the purchaser is not required to exercise the option. If the
underlying position incurs a gain, a Fund would let the put option expire
resulting in a reduced profit on the underlying security equal to the cost of
the put option.
When the Fund purchases an option, it is required to pay a premium to the party
writing the option and a commission to the broker selling the option. If the
option is exercised by the Fund, the premium and the commission paid may be
greater than the amount of the brokerage commission charged if the security were
to be purchased or sold directly. The cost of the put option is limited to the
premium plus commission paid. The Fund's maximum financial exposure will be
limited to these costs.
A Fund may purchase both listed and over-the-counter put options. The Fund will
be exposed to the risk of counterparty nonperformance in the case of
over-the-counter put options.
Put options on securities may not be available to a Fund on reasonable terms in
many situations and a Fund may frequently choose not to purchase options even
when they are available. A Fund's ability to engage in option transactions may
be limited by tax considerations.
Other Investment Companies. Certain emerging markets have restrictions that
preclude or limit direct foreign investment in the securities of their
companies. However, indirect foreign investment is permitted in certain emerging
markets through governmentally authorized investment vehicles or companies,
including closed-end investment companies, which may be acquired at prices in
excess of their net asset values. In accordance with the 1940 Act, each Fund may
invest up to 10% of its assets in shares of other investment companies. If a
Fund invests in other investment companies, shareholders would bear not only
their proportionate share of that Fund's expenses (including operating expenses
and advisory fees), but also similar expenses of the underlying investment
companies.
Short Sales. Each Fund may sell securities short "against-the-box." A short sale
"against-the-box" is a short sale in which a Fund owns an equal amount of the
securities sold short or securities convertible into or exchangeable without
payment of further consideration for securities of the same issuer as, and equal
in amount to, the securities sold short.
Repurchase Agreements. Each Fund may enter into repurchase agreements with
commercial banks and broker/dealers as a short-term cash management tool. A
repurchase agreement is an agreement under which a Fund acquires a security,
generally a US Government obligation, subject to resale at a mutually
agreed-upon price and time. The resale price reflects an agreed upon interest
rate effective for the period of time a Fund holds the security and is unrelated
to the interest rate on the security. A Fund's repurchase agreement will at all
times be fully collateralized.
Repurchase agreements could involve certain risks in the event of bankruptcy or
other default by the seller, including possible delays and expenses in
liquidating securities underlying the agreement, a decline in the value of the
underlying securities and a loss of interest. Repurchase agreements are
typically entered into for periods of one week or less. As a matter of
fundamental policy, a Fund will not enter into repurchase agreements of more
than one week's duration if more than 10% of its net assets would be invested in
such agreements and other illiquid securities.
Illiquid Securities. Each Fund may invest up to 15% of its net assets in
illiquid securities, including restricted securities (i.e., securities not
readily marketable without registration under the Securities Act of 1933 (1933
Act)) and other securities that are not readily marketable. Each Fund does not
currently expect to invest more than 5% of its assets in such securities. A Fund
may purchase restricted securities that can be offered and sold to "qualified
institutional buyers" under Rule 144A of the 1933 Act, and the Funds' Board of
Directors may determine, when appropriate, that specific Rule 144A securities
are liquid and not subject to the 15% limitation on illiquid securities. Should
the Board of Directors make this determination, it will carefully monitor the
security (focusing on such factors, among others as trading activity and
availability of information) to determine that the Rule 144A security continues
to be liquid. It is not possible to predict with assurance exactly how the
market for Rule 144A securities will further evolve. This investment practice
could have the effect of increasing the level of illiquidity in a Fund, if and
to the extent that qualified institutional buyers become for a time uninterested
in purchasing Rule 144A securities.
7
<PAGE>
Borrowing. Each Fund may borrow money only from banks and only for temporary or
emergency purposes (but not for the purchase of portfolio securities) in an
amount not in excess of 5% of each Fund's total assets (except the Emerging
Markets Fund, where such borrowings will not exceed 10% of the Fund's total
assets) and will be made at prevailing interest rates. Each Fund's borrowings
are limited so that immediately after such borrowing the value of its assets
(including borrowings) less its liabilities (not including borrowings) is at
least three times the amount of the borrowings. Should a Fund, for any reason,
have borrowings that do not meet the above test, that Fund must reduce its
borrowings so as to meet the foregoing test within three business days. Under
these circumstances, a Fund may have to liquidate portfolio securities at a time
when it is disadvantageous to do so. Gains made with additional funds borrowed
will generally cause the net asset value of a Fund's shares to rise faster than
could be the case without borrowings. Conversely, if investment results fail to
cover the cost of borrowings, the net asset value of a Fund could decrease
faster than if there had been no borrowings.
Lending of Portfolio Securities. Each Fund may lend portfolio securities to
broker/dealers or other institutions if the investment manager believes such
loans will be beneficial to a Fund. The borrower must maintain with a Fund cash
or equivalent collateral equal to at least 100% of the market value of the
securities loaned. During the time portfolio securities are on loan, the
borrower pays that Fund any dividend or interest paid on the securities. A Fund
may invest the collateral and earn additional income or receive an agreed upon
amount of interest income from the borrower. Loans made by a Fund will generally
be short-term. Loans are subject to termination at the option of the Fund or the
borrower. A Fund may pay reasonable administrative and custodial fees in
connection with a loan and may pay a negotiated portion of the interest earned
on the collateral to the borrower or placing broker. A Fund does not have the
right to vote securities on loan, but would terminate the loan and regain the
right to vote if it were considered important with respect to the investment. A
Fund may lose money if a borrower defaults on its obligation to return
securities and the value of the collateral held by that Fund is insufficient to
replace the loaned securities. In addition, a Fund is responsible for any loss
that might result from its investment of the borrower's collateral.
Except as otherwise specifically noted above, a Fund's investment strategies are
not fundamental and the Funds, with the approval of the Board of Directors, may
change such strategies without the vote of shareholders.
Fund Policies
Each Fund is subject to fundamental policies that place restrictions on certain
types of investments. These policies cannot be changed except by vote of a
majority of the Fund's outstanding voting securities. Under these policies, each
Fund may not:
1. As to 75% of the value of its total assets, invest more than 5% of its
total assets, at market value, in the securities of any one issuer (except
securities issued or guaranteed by the US Government, its agencies or
instrumentalities);
2. Invest more than 25% of its total assets, at market value, in the
securities of issuers principally engaged in the same industry (except
securities issued or guaranteed by the US Government, its agencies or
instrumentalities);
3. Own more than 10% of the outstanding voting securities of any issuer, or
more than 10% of any class of securities of one issuer;
4. Invest more than 5% of the value of its total assets, at market value, in
the securities of issuers which, with their predecessors, have been in
business less than three years; provided, however, that securities
guaranteed by a company that (including predecessors) has been in operation
at least three continuous years shall be excluded from this limitation;
5. Purchase securities of open-end or closed-end investment companies, except
as permitted by the Investment Company Act of 1940, as amended, and other
applicable law or for the purpose of hedging the Fund's obligations under
the deferred compensation plan for directors;
8
<PAGE>
6. Invest in warrants if, at the time of acquisition, the investment in
warrants, valued at the lower of cost or market value, would exceed 5% of
the Fund's net assets. For purposes of this restriction, warrants acquired
by a Fund in units or attached to securities may be deemed to have been
purchased without cost;
7. Make loans of money or securities other than (a) through the purchase of
securities in accordance with a Fund's investment objective, (b) through
repurchase agreements and (c) by lending portfolio securities in an amount
not to exceed 33 1/3% of its total assets;
8. Issue senior securities or borrow money except from banks and then in
amounts not in excess of 5% (10% for Emerging Markets Fund) of its total
assets, as described above;
9. Buy any securities or other property on margin (except for such short-term
credits as are necessary for the clearance of transactions)'
10. Invest in companies for the purpose of exercising control or management;
11. Underwrite securities of other issuers except to the extent that a Fund may
be deemed an underwriter when purchasing or selling portfolio securities;
12. Purchase or retain securities of any issuer (other than the shares of the
Fund) if to the Fund's knowledge, those officers and directors of the Fund
and the officers and directors of the investment manager or subadviser, who
individually own beneficially more than 1/2 of 1% of the outstanding
securities of such issuer, together own beneficially more than 5% of such
outstanding securities;
13. Purchase or sell real estate (although it may purchase securities secured
by real estate or interests therein, or issued by companies or investment
trusts that invest in real estate or interests therein); or
14. Make short sales except short sales against-the-box.
Each Fund also may not change its investment objective without shareholder
approval.
Under the Investment Company Act of 1940, as amended (1940 Act), a "vote of a
majority of the outstanding voting securities" of a Fund means the affirmative
vote of the lesser of (l) more than 50% of the outstanding shares of the Fund;
or (2) 67% or more of the shares present at a shareholders' meeting if more than
50% of the outstanding shares are represented at the meeting in person or by
proxy.
Each Fund also may not acquire any securities of a registered open-end
investment company or a registered unit investment trust in reliance on
subparagraph (F) or subparagraph (G) of Section 12(d)(1) of the 1940 Act. This
policy is not fundamental.
Temporary Defensive Position
In an attempt to respond to adverse market, economic, political, or other
conditions, a Fund may invest up to 100% of its assets in cash or cash
equivalents, including, but not limited to, prime commercial paper, bank
certificates of deposit, bankers' acceptances, or repurchase agreements for such
securities, and securities of the US Government and its agencies and
instrumentalities, as well as cash and cash equivalents denominated in foreign
currencies. A Fund's investments in foreign cash equivalents will be limited to
those that, in the opinion of the investment manager, equate generally to the
standards established for US cash equivalents. Investments in bank obligations
will be limited at the time of investment to the obligations of the 100 largest
domestic banks in terms of assets which are subject to regulatory supervision by
the US Government or state governments, and the obligations of the 100 largest
foreign banks in terms of assets with branches or agencies in the United States.
Portfolio Turnover
A Fund's portfolio turnover rate is calculated by dividing the lesser of
purchases or sales of portfolio securities for the fiscal year by the monthly
average of the value of the portfolio securities owned during the fiscal year.
Securities whose maturity or expiration date at the time of acquisition were one
year or less are excluded from the calculation. The Funds' portfolio turnover
rates for the fiscal years ended October 31, 1999 and 1998 were:
9
<PAGE>
Fund 1999 1998
---- ---- ----
Emerging Markets Fund 136.94% 94.09%
Global Growth Fund 65.16 45.43
Global Smaller Companies Fund 61.31 50.81
Global Technology Fund 91.12 87.55
International Growth Fund 83.10 81.37
Management of the Funds
Board of Directors
The Board of Directors provides broad supervision over the affairs of the Funds.
Management Information
Directors and officers of the Funds, together with information as to their
principal business occupations during the past five years, are shown below. Each
Director who is an "interested person" of the Funds, as defined in the 1940 Act,
is indicated by an asterisk. Unless otherwise indicated, their addresses are 100
Park Avenue, New York, NY 10017.
<TABLE>
<CAPTION>
Name, Principal
(Age) and Position(s) Held Occupation(s) During
Address With Fund Past 5 Years
------- --------- ------------
<S> <C> <C>
William C. Morris* Director, Chairman of Chairman, J. & W. Seligman & Co. Incorporated, Chairman and Chief
(61) the Board, Chief Executive Officer, the Seligman Group of investment companies;
Executive Officer and Chairman, Seligman Advisors, Inc, Seligman Services, Inc., and
Chairman of the Carbo Ceramics Inc., ceramic proppants for oil and gas industry;
Executive Committee and Director, Seligman Data Corp., Kerr-McGee Corporation,
diversified energy company. Formerly, Director, Daniel Industries
Inc., manufacturer of oil and gas metering equipment.
Brian T. Zino* Director, President Director and President, J. & W. Seligman & Co. Incorporated;
(47) and Member of the President (with the exception of Seligman Quality Municipal Fund,
Executive Committee Inc. and Seligman Select Municipal Fund, Inc.) and Director or
Trustee, the Seligman Group of investment companies; Chairman,
Seligman Data Corp.; Member of the Board of Governors of the
Investment Company Institute and Director, ICI Mutual Insurance
Company; Seligman Advisors, Inc., and Seligman Services, Inc.
Richard R. Schmaltz* Director and Member of Director and Managing Director, Director of Investments, J. & W.
(59) the Executive Committee Seligman & Co. Incorporated; Director or Trustee, the Seligman
Group of investment companies (except Seligman Cash Management
Fund, Inc.); Director, Seligman Henderson Co., and Trustee
Emeritus of Colby College. Formerly, Director, Investment
Research at Neuberger & Berman from May 1993 to September 1996.
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
Name, Principal
(Age) and Position(s) Held Occupation(s) During
Address With Fund Past 5 Years
------- --------- ------------
<S> <C> <C>
John R. Galvin Director Dean, Fletcher School of Law and Diplomacy at Tufts University;
(70) Director or Trustee, the Seligman Group of investment companies;
Tufts University Chairman Emeritus, American Council on Germany; Governor of the
Packard Avenue, Center for Creative Leadership; Director; Raytheon Co.,
Medford, MA 02155 electronics; National Defense University; and the Institute for
Defense Analysis. Formerly, Director, USLIFE Corporation, life
insurance; Ambassador, U.S. State Department for negotiations in
Bosnia; Distinguished Policy Analyst at Ohio State University and
Olin Distinguished Professor of National Security Studies at the
United States Military Academy. From June 1987 to June 1992, he
was the Supreme Allied Commander, Europe and the
Commander-in-Chief, United States European Command.
Alice S. Ilchman Director Retired President, Sarah Lawrence College; Director or Trustee,
(64) the Seligman Group of investment companies; Trustee, the Committee
18 Highland Circle for Economic Development; and Chairman, The Rockefeller
Bronxville, NY 10708 Foundation, charitable foundation. Formerly, Trustee, The Markle
Foundation, philanthropic organization; and Director, New York
Telephone Company and International Research and Exchange Board,
intellectual exchanges.
Frank A. McPherson Director Retired Chairman and Chief Executive Officer of Kerr-McGee
(66) Corporation; Director or Trustee, the Seligman Group of investment
2601 Northwest Expressway, companies; Director, Kimberly-Clark Corporation, consumer
Suite 805E products; Bank of Oklahoma Holding Company; Baptist Medical
Oklahoma City, OK 73112 Center; Oklahoma Chapter of the Nature Conservancy; Oklahoma
Medical Research Foundation; and National Boys and Girls Clubs of
America; and Member of the Business Roundtable and National
Petroleum Council. Formerly, Chairman, Oklahoma City Public
Schools Foundation; and Director, Federal Reserve System's Kansas
City Reserve Bank and the Oklahoma City Chamber of Commerce.
John E. Merow Director Retired Chairman and Senior Partner, Sullivan & Cromwell, law
(70) firm; Director or Trustee, the Seligman Group of investment
125 Broad Street, companies; Director, Commonwealth Industries, Inc., manufacturers
New York, NY 10004 of aluminum sheet products; the Foreign Policy Association;
Municipal Art Society of New York; the U.S. Council for
International Business; and New York-Presbyterian Hospital;
Chairman, New York-Presbyterian Healthcare Network, Inc.;
Vice-Chairman, the U.S.-New Zealand Council; and Member of the
American Law Institute and Council on Foreign Relations.
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
Name, Principal
(Age) and Position(s) Held Occupation(s) During
Address with Fund Past 5 Years
------- --------- ------------
<S> <C> <C>
Betsy S. Michel Director Attorney; Director or Trustee, the Seligman Group of investment
(57) companies; Trustee, The Geraldine R. Dodge Foundation, charitable
P.O. Box 449 foundation. Formerly, Chairman of the Board of Trustees of St.
Gladstone, NJ 07934 George's School (Newport, RI) and Director, the National
Association of Independent Schools (Washington, DC).
James C. Pitney Director Retired Partner, Pitney, Hardin, Kipp & Szuch, law firm; Director
(73) or Trustee, the Seligman Group of investment companies. Formerly,
Park Avenue at Morris Director, Public Service Enterprise Group, public utility.
County,
P.O. Box 1945,
Morristown, NJ 07962
James Q. Riordan Director Director or Trustee, the Seligman Group of investment companies;
(72) Director, The Houston Exploration Company, oil exploration; The
675 Third Avenue, Brooklyn Museum, KeySpan Energy Corporation; and Public
Suite 3004 Broadcasting Service; and Trustee, the Committee for Economic
New York, NY 10017 Development. Formerly, Co-Chairman of the Policy Council of the
Tax Foundation; Director, Tesoro Petroleum Companies, Inc. and Dow
Jones & Company, Inc.; Director and President, Bekaert
Corporation; and Co-Chairman, Mobil Corporation.
Robert L. Shafer Director Retired Vice President, Pfizer Inc., pharmaceuticals; Director or
(67) Trustee, the Seligman Group of investment companies. Formerly,
96 Evergreen Avenue, Director, USLIFE Corporation, life insurer.
Rye, NY 10580
James N. Whitson Director Director and Consultant, Sammons Enterprises, Inc., a diversified
(64) holding company; Director or Trustee, the Seligman Group of
6606 Forestshire Drive investment companies; Director, C-SPAN, cable television, and
Dallas, TX 75230 CommScope, Inc., manufacturer of coaxial cables. Formerly,
Executive Vice President, Chief Operating Officer, Sammons
Enterprises, Inc.; and Director, Red Man Pipe and Supply Company,
piping and other materials.
Daniel J. Barker Vice President and Senior Vice President, J. & W. Seligman & Co. Incorporated, since
(32) Portfolio Manager October 1999. Formerly, Portfolio Manager at GE Investments since
1994; and Corporate Financial Analyst at GE Information Services from
1990 to 1994.
Iain C. Clark Vice President and Chief Investment Officer, Henderson Investment Management Limited
(49) Portfolio Manager since April 1992. He has been a Director at Henderson
International Limited and Senior Portfolio Manager at
Henderson plc, respectively, since April 1985.
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Name, Principal
(Age) and Position(s) Held Occupation(s) During
Address With Fund Past 5 Years
------- --------- ------------
<S> <C> <C>
Jack P. Chang Vice President and Managing Director, J. & W. Seligman & Co. Incorporated; Vice
(41) Portfolio Manager President and Portfolio Manager, Seligman Portfolios, Inc.
Formerly, Senior Vice President and Portfolio Manager at Putnam
Investment Management since 1997; and Portfolio Manager
with Columbia Management Company from 1993 to 1997.
Arsen Mrakovcic Vice President and Managing Director, J. & W. Seligman & Co. Incorporated; Vice
(34) Portfolio Manager President and Portfolio Manager, Seligman Frontier Fund, Inc. and
Seligman Portfolios, Inc. Formerly, Vice President, Investment
Officer, J. & W. Seligman & Co. Incorporated from January 1995 to
January 1996 and Portfolio Assistant, J. & W. Seligman & Co.
Incorporated from June 1992 to January 1995.
Marion S. Schultheis Vice President and Managing Director, J. & W. Seligman & Co. Incorporated since May
(54) Portfolio Manager 1998; Vice President and Portfolio Manager, Seligman Capital Fund,
Inc., Seligman Growth Fund, Inc. and Seligman Portfolios, Inc..
Formerly, Managing Director at Chancellor LGT from October 1997
until May 1998; and Senior Portfolio Manager at IDS Advisory Group
Inc. from August 1987 until October 1997.
Steven A. Werber Vice President and Senior Vice President, J. & W. Seligman & Co. Incorporated; Vice
(34) Portfolio Manager President and Portfolio Manager, Seligman Portfolios, Inc.
Formerly, Analyst and Portfolio Manager at Fidelity Investments
International since 1996; and Associate at Goldman
Sachs International from 1992 to 1996.
Paul H. Wick Vice President and Managing Director and Director, J. & W. Seligman & Co.
(37) Portfolio Manager Incorporated since January 1995 and November 1997, respectively;
Vice President and Portfolio Manager, Seligman Communications and
Information Fund, Inc., Seligman New Technologies Fund, Inc., and
Seligman Portfolios, Inc. He joined J. & W. Seligman & Co.
Incorporated in 1987 as an Associate, Investment Research.
Formerly, Vice President, Investment Officer, J. & W. Seligman &
Co. Incorporated from April 1993 to November 1997.
Kei Yamamoto Vice President and Senior Vice President, J. & W. Seligman & Co. Incorporated; Vice
(35) Portfolio Manager President and Portfolio Manager, Seligman Portfolios, Inc.
Formerly, Associate Portfolio Manager at Oppenheimer Funds, Inc.
from 1997 to 1998; and Assistant Portfolio Manager at Franklin
Templeton Group from 1994 to 1997.
Lawrence P. Vogel Vice President Senior Vice President, Finance, J. & W. Seligman & Co.
(43) Incorporated, Seligman Advisors, Inc., and Seligman Data Corp.;
Vice President, the Seligman Group of investment companies and
Seligman Services, Inc.; Vice President and Treasurer, Seligman
International, Inc.; and Treasurer, Seligman Henderson Co.
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
Name, Principal
(Age) and Position(s) Held Occupation(s) During
Address With Fund Past 5 Years
------- --------- ------------
<S> <C> <C>
Frank J. Nasta Secretary General Counsel, Senior Vice President, Law and Regulation and
(35) Corporate Secretary, J. & W. Seligman & Co. Incorporated;
Secretary, the Seligman Group of investment companies, Seligman
Advisors, Inc., Seligman Henderson Co., Seligman Services, Inc.,
Seligman International, Inc. and Seligman Data Corp.
Thomas G. Rose Treasurer Treasurer, the Seligman Group of investment companies and Seligman
(42) Data Corp.
</TABLE>
The Executive Committee of the Board acts on behalf of the Board between
meetings to determine the value of securities and assets owned by the Funds for
which no market valuation is available, and to elect or appoint officers of the
Funds to serve until the next meeting of the Board.
Directors and officers of the Funds are also directors and officers of some or
all of the other investment companies in the Seligman Group.
Compensation
<TABLE>
<CAPTION>
Pension or Total Compensation
Aggregate Retirement Benefits From Funds and
Name and Compensation Accrued as Part of Fund Complex Paid
Position with Fund From Funds (1) Fund Expenses to Directors (1)(2)
------------------ -------------- ------------- -------------------
<S> <C> <C> <C>
William C. Morris, Director and Chairman N/A N/A N/A
Brian T. Zino, Director and President N/A N/A N/A
Richard R. Schmaltz, Director N/A N/A N/A
John R. Galvin, Director $6,682.22 N/A $82,000
Alice S. Ilchman, Director 6,582.22 N/A 80,000
Frank A. McPherson, Director 6,678.22 N/A 80,000
John E. Merow, Director 5,570.22 N/A 80,000
Betsy S. Michel, Director 6,682.22 N/A 82,000
James C. Pitney, Director 5,370.22 N/A 74,000
James Q. Riordan, Director 6,582.22 N/A 80,000
Robert L. Shafer, Director 6,582.22 N/A 80,000
James N. Whitson, Director 6,582.22 (3) N/A 80,000 (3)
</TABLE>
- ------------------------------
(1) For the Fund's fiscal year ended October 31, 1999.
(2) The Seligman Group of investment companies consists of twenty investment
companies.
(3) Deferred.
Seligman Global Fund Series, Inc. has a compensation arrangement under which
outside directors may elect to defer receiving their fees. Seligman Global Fund
Series, Inc. has adopted a deferred compensation plan under which a director who
has elected deferral of his or her fees may choose a rate of return equal to
either (1) the interest rate on short-term Treasury Bills, or (2) the rate of
return on the shares of certain of the investment companies advised by J. & W.
Seligman & Co. Incorporated (Seligman), as designated by the director. The cost
of such fees and earnings is included in directors' fees and expenses, and the
accumulated balance thereof is included in other liabilities in the Funds'
financial statements. The total amount of deferred compensation (including
earnings) payable in respect of the Funds to Mr. Whitson as of October 31, 1999
was $34,353.
Messrs. Merow and Pitney no longer defer current compensation; however, they
have accrued deferred compensation in the amounts of $14,984 and $1,178,
respectively, as of October 31, 1999.
The Funds may, but are not obligated to, purchase shares of the other funds in
the Seligman Group of investment companies to hedge their obligations in
connection with the deferred compensation plan.
14
<PAGE>
Sales Charges
Class A shares of each Fund may be issued without a sales charge to present and
retired directors, trustees, officers, employees (and their family members) of
the Funds, the other investment companies in the Seligman Group, and Seligman
and its affiliates. Family members are defined to include lineal descendants and
lineal ancestors, siblings (and their spouses and children) and any company or
organization controlled by any of the foregoing. Such sales may also be made to
employee benefit plans and thrift plans for such persons and to any investment
advisory, custodial, trust or other fiduciary account managed or advised by
Seligman or any affiliate. The sales may be made for investment purposes only,
and shares may be resold only to a Fund.
Class A shares may be sold at net asset value to these persons since such sales
require less sales effort and lower sales related expenses as compared with
sales to the general public.
Code of Ethics
Seligman, Seligman Advisors, Inc. (Seligman Advisors), their subsidiaries and
affiliates, and the Seligman Group of Investment Companies have adopted a Code
of Ethics that sets forth the circumstances under which officers, directors and
employees (collectively, Employees) are permitted to engage in personal
securities transactions. The Code of Ethics proscribes certain practices with
regard to personal securities transactions and personal dealings, provides a
framework for the reporting and monitoring of personal securities transactions
by Seligman's Director of Compliance, and sets forth a procedure of identifying,
for disciplinary action, those individuals who violate the Code of Ethics. The
Code of Ethics prohibits Employees (including all investment team members) from
purchasing or selling any security or an equivalent security that is being
purchased or sold by any client, or where the Employee intends, or knows of
another person's intention, to purchase or sell the security on behalf of a
client. The Code also prohibits all Employees from acquiring securities in a
private placement or in an initial or secondary public offering unless an
exemption has been obtained from Seligman's Director of Compliance.
The Code of Ethics prohibits (1) each portfolio manager or member of an
investment team from purchasing or selling any security within seven calendar
days of the purchase or sale of the security by a client's account (including
investment company accounts) that the portfolio manager or investment team
manages; (2) each Employee from engaging in short-term trading (a purchase and
sale or vice-versa within 60 days); and (3) each member of an investment team
from engaging in short sales of a security if, at that time, any client managed
by that team has a long position in that security. Any profit realized pursuant
to any of these prohibitions must be disgorged.
Employees are required, except under very limited circumstances, to engage in
personal securities transactions through Seligman's order desk. The order desk
maintains a list of securities that may not be purchased due to a possible
conflict with clients. All Employees are also required to disclose all
securities beneficially owned by them upon commencement of employment and at the
end of each calendar year.
A copy of the Code of Ethics is on public file with, and is available upon
request from, the Securities and Exchange Commission (SEC). You can access it
through the SEC's Internet site, http://www.sec.gov.
Control Persons and Principal Holders of Securities
Control Persons
As of February 11, 2000, there was no person or persons who controlled any of
the Funds, either through a significant ownership of shares or any other means
of control.
Principal Holders
As of February 11, 2000, Merrill Lynch, Pierce, Fenner & Smith, Incorporated for
the Sole Benefit of Its Customers, Attn. Fund Administration, 4800 Deer Lake
Drive East, 3rd Floor, Jacksonville, FL 32246, owned of record more than 5% of
the then outstanding shares of capital stock of a Class of the following Funds:
15
<PAGE>
Percentage of Total Outstanding
Fund/Class Shares of the Class of the Fund
---------- -------------------------------
Emerging Markets Fund/A 7.50%
Emerging Markets Fund/B 30.11%
Emerging Markets Fund/D 32.00%
Global Growth Fund/A 32.65%
Global Growth Fund/B 36.45%
Global Growth Fund/D 44.00%
Global Smaller Companies Fund/A 18.72%
Global Smaller Companies Fund/B 30.40%
Global Smaller Companies Fund/D 44.14%
Global Technology Fund/A 16.57%
Global Technology Fund/B 29.70%
Global Technology Fund/D 29.07%
International Growth Fund/A 10.78%
International Growth Fund/B 26.58%
International Growth Fund/D 30.56%
As of the same date, the following entities owned 5% or more of the then
outstanding shares of capital stock of a Class for the following Funds:
<TABLE>
<CAPTION>
Percentage of Total
Outstanding Fund
Name and Address Fund/Class Shares Held
---------------- ---------- -----------
<S> <C> <C>
PaineWebber for the Benefit of Joseph Wisne Trust
3707 W. Maple, Bloomfield Hills, MI 48301 Emerging Markets/A 7.50%
Donaldson Lufkin Jenrette Securities Corporation
Inc., PO Box 2052, Jersey City, NJ 07303-9998 Emerging Markets/C 7.38%
Investors Fiduciary Trust Company, Custodian For
Barbara Cancienne, 8147 Titleist Drive, Pineville,
LA 71360 Emerging Markets/C 6.54%
Donaldson Lufkin Jenrette Securities Corporation
Inc., PO Box 2052, Jersey City, NJ 07303-9998 Emerging Markets/C 5.85%
Dr. George and Vera Marse JTWROS, 5400 Rebecca Blvd.,
Kenner, LA 70065 Emerging Markets/C 5.52%
Salomon Smith Barney Inc, For Shareholder Accounts,
333 West 34th Street, 3rd Floor, New York, NY 10001 Global Smaller Companies/C 6.75%
Donaldson Lufkin Jenrette Securities Corporation
Inc., PO Box 2052, Jersey City, NJ 07303-9998 Global Smaller Companies/C 6.69%
Salomon Smith Barney Inc, For Shareholder Accounts,
333 West 34th Street, 3rd Floor, New York, NY 10001 Global Smaller Companies/C 6.67%
LEWCO Securities Corp., FBO Accounts, 34 Exchange
Place, 4th Floor, Jersey City, NJ 07311 Global Smaller Companies/C 5.69%
Stephens Funeral Home Inc, 305 East State Street,
Scottville, MI 49454-1289 Global Smaller Companies/C 5.34%
First Clearing Corporation, FBO Accounts, Allen
Pellett IRA, 226 Camille Avenue, Greenville, SC International Growth /C 5.80%
29605-1704
</TABLE>
16
<PAGE>
Management Ownership
As of February 11, 2000, Directors and officers of the Funds as a group owned:
1.56% of the then outstanding Class A shares of capital stock of the Emerging
Markets Fund; 1.93% of the then outstanding Class A shares of capital stock of
the Global Growth Fund; 4.42% of the then outstanding Class A shares of capital
stock of the International Growth Fund; and less than 1% of the then outstanding
Class A shares of capital stock of the Global Smaller Companies Fund and Global
Technology Fund. As of the same date, Directors and officers of the Funds as a
group owned less than 1% of the then outstanding Class B, Class C and Class D
shares of capital stock of any of the Funds.
Investment Advisory and Other Services
Investment Manager
Seligman manages the Funds. Seligman is a successor firm to an investment
banking business founded in 1864 which has thereafter provided investment
services to individuals, families, institutions, and corporations. On December
29, 1988, a majority of the outstanding voting securities of Seligman was
purchased by Mr. William C. Morris and a simultaneous recapitalization of
Seligman occurred. See Appendix B for further history of Seligman.
All of the officers of the Funds listed above are officers or employees of
Seligman. Their affiliations with the Funds and with Seligman are provided under
their principal business occupations.
Each Fund pays Seligman a fee for its management services equal to a percentage
of the Fund's average daily net assets. The fee rate declines as each Fund's net
assets increase. The management fee rate with respect to the Emerging Markets
Fund is equal to 1.25% of average daily net assets on the first $1 billion of
net assets, 1.15% of average daily net assets on the next $1 billion and 1.05%
of average daily net assets in excess of $2 billion. The management fee rate
with respect to the Global Technology Fund is equal to an annual rate of 1.00%
of average daily net assets on the first $2 billion of net assets, .95% of
average daily net assets on the next $2 billion and .90% of average daily net
assets in excess of $4 billion. The management fee rate with respect to each
other Fund is equal to an annual rate of 1.00% of average daily net assets on
the first $1 billion of net assets, .95% of average daily net assets on the next
$1 billion and .90% of average daily net assets in excess of $2 billion. The
following chart indicates the management fees paid by each Fund as well as the
percentage such fees represents of each Fund's average daily net assets for the
fiscal years ended October 31, 1999, 1998 and 1997.
<TABLE>
<CAPTION>
Fiscal Management % of
Year/Period Fee Average Daily
Fund Ended Paid ($) Net Assets (%)
---- ----------------- -------- --------------
<S> <C> <C> <C> <C>
Emerging Markets Fund 10/31/99 $ 706,046 1.25%
10/31/98 1,034,015 1.25
10/31/97 1,110,307 1.25
Global Growth Fund 10/31/99 $2,115,163 1.00%
10/31/98 1,982,193 1.00
10/31/97 1,903,374 1.00
Global Smaller Companies Fund 10/31/99 $6,731,872 1.00%
10/31/98 9,995,944 1.00
10/31/97 9,494,033 1.00
Global Technology Fund 10/31/99 $9,309,644 1.00%
10/31/98 8,247,297 1.00
10/31/97 8,488,410 1.00
International Growth Fund 10/31/99 $910,270 1.00%
10/31/98 954,634 1.00
10/31/97 993,229 1.00
</TABLE>
17
<PAGE>
Under a Subadvisory Agreement, dated July 1, 1998 until the close of business on
March 31, 2000, Henderson Investment Management Limited (HIML) will furnish
certain investment advice, research and assistance with respect to each Fund's
non-US investments. Effective on the close of business March 31, 2000, Seligman
will assume complete responsibility for the portfolio management of Seligman
International Growth Fund, Seligman Emerging Markets Fund, Seligman Global
Growth Fund and Seligman Global Technology Fund. HIML will continue to provide
such services with respect to Seligman Global Smaller Companies Fund's non-US
investments.
HIML, headquartered in the United Kingdom, was incorporated in 1984 and is a
registered investment adviser under the Investment Advisers Act of 1940. HIML is
a wholly owned subsidiary of Henderson plc. Henderson plc is a subsidiary of AMP
Limited, an Australian life insurance and financial services company. Henderson
plc, headquartered in London, is one of the largest money managers in Europe.
HIML receives a fee from Seligman, in respect of each Fund other than Seligman
Global Smaller Companies Fund until March 31, 2000, and in respect of Seligman
Global Smaller Companies Fund thereafter, based on the "applicable percentage"
of the average monthly assets of such Fund under its supervision. The
"applicable percentage" is an annual rate of 0.90% for the period July 1, 1998
to June 30, 1999; 0.70% for the period July 1, 1999 to June 30, 2000; and 0.50%
thereafter. The Subadvisory Agreement provides that it will continue until
December 31, 1999; and, thereafter, is subject to the annual approval of the
Funds' Board of Directors.
Each Fund pays all of its expenses, other than those assumed by Seligman or
HIML, including brokerage commissions, administration, shareholder services and
distribution fees, fees and expenses of independent attorneys and auditors,
taxes and governmental fees, including fees and expenses of qualifying the Funds
and their shares under federal and state securities laws, cost of stock
certificates and expenses of repurchase or redemption of shares, expenses of
printing and distributing reports, notices and proxy materials to shareholders,
expenses of printing and filing reports and other documents with governmental
agencies, expenses of shareholders' meetings, expenses of corporate data
processing and related services, shareholder record keeping and shareholder
account services, fees and disbursements of transfer agents and custodians,
expenses of disbursing dividends and distributions, fees and expenses of
directors of the Funds not employed by or serving as a director of Seligman or
its affiliates, insurance premiums and extraordinary expenses such as litigation
expenses. These expenses are allocated between each Fund and between the classes
of each Fund in a manner determined by the Board of Directors to be fair and
equitable.
The Management Agreement provides that Seligman will not be liable to the Funds
for any error of judgment or mistake of law, or for any loss arising out of any
investment, or for any act or omission in performing its duties under the
Agreement, except for willful misfeasance, bad faith, gross negligence, or
reckless disregard of its obligations and duties under the Agreements.
The Management Agreement was initially approved by the Board of Directors at a
meeting held on March 19, 1992 and by the shareholders on May 20, 1993. The
Management Agreement will continue in effect until December 31 of each year if
(1) such continuance is approved in the manner required by the 1940 Act (i.e.,
by a vote of a majority of the Board of Directors or of the outstanding voting
securities of each Fund and by a vote of a majority of the Directors who are not
parties to the Management Agreement or interested persons of any such party) and
(2) Seligman has not notified the Funds at least 60 days prior to December 31 of
any year that it does not desire such continuance. The Management Agreement may
be terminated by a Fund, without penalty, on 60 days' written notice to Seligman
and will terminate automatically in the event of its assignment. Seligman Global
Fund Series, Inc. has agreed to change its name upon termination of the
Management Agreement if continued use of the name would cause confusion in the
context of Seligman's business.
Principal Underwriter
Seligman Advisors, an affiliate of Seligman, 100 Park Avenue, New York, New York
10017, acts as general distributor of the shares of each Fund and of the other
mutual funds in the Seligman Group. Seligman Advisors is an "affiliated person"
(as defined in the 1940 Act) of Seligman, which is itself an affiliated person
of the Funds. Those individuals identified above under "Management Information"
as directors or officers of both the Funds and Seligman Advisors are affiliated
persons of both entities.
18
<PAGE>
Services Provided by the Investment Manager
Under the Management Agreement, dated March 19, 1992, subject to the control of
the Board of Directors, Seligman manages the investment of the assets of each
Fund, including making purchases and sales of portfolio securities consistent
with each Fund's investment objectives and policies, and administers its
business and other affairs. Seligman provides the Fund with such office space,
administrative and other services and executive and other personnel as are
necessary for Fund operations. Seligman pays all of the compensation of
directors of the Fund who are employees or consultants of Seligman and of the
officers and employees of the Fund. Seligman also provides senior management for
Seligman Data Corp., the Fund's shareholder service agent.
Service Agreements
There are no other management-related service contracts under which services are
provided to the Funds.
Other Investment Advice
No person or persons, other than directors, officers, or employees of Seligman,
or HIML with respect to Global Smaller Companies Fund, regularly advise the
Funds with respect to their investments.
Dealer Reallowances
Dealers and financial advisors receive a percentage of the initial sales charge
on sales of Class A shares and Class C shares of the Funds, as set forth below:
Class A shares:
<TABLE>
<CAPTION>
Regular Dealer
Sales Charge Sales Charge Reallowance
as a % of as a % of Net as a % of
Amount of Purchase Offering Price(1) Amount Invested Offering Price
- ------------------ ----------------- --------------- --------------
<S> <C> <C> <C>
Less than $ 50,000 4.75% 4.99% 4.25%
$50,000 - $ 99,999 4.00 4.17 3.50
$100,000 - $249,999 3.50 3.63 3.00
$250,000 - $499,999 2.50 2.56 2.25
$500,000 - $999,999 2.00 2.04 1.75
$1,000,000 and over 0 0 0
</TABLE>
(1) "Offering Price" is the amount that you actually pay for Fund shares; it
includes the initial sales charge.
Class C shares:
<TABLE>
<CAPTION>
Regular Dealer
Sales Charge Sales Charge Reallowance
as a % of as a % of Net as a % of
Amount of Purchase Offering Price(1) Amount Invested Offering Price
- ------------------ ----------------- --------------- --------------
<S> <C> <C> <C>
Less than $100,000 1.00% 1.01% 1.00%
$100,000 - $249,999 0.50 0.50 0.50
$250,000 - $1,000,000 0 0 0
</TABLE>
(1) "Offering Price" is the amount that you actually pay for Fund shares; it
includes the initial sales charge.
Seligman Services, Inc. (Seligman Services), an affiliate of Seligman, is a
limited purpose broker/dealer. Seligman Services is eligible to receive
commissions from certain sales of Fund shares. For the fiscal years ended
October 31, 1999, 1998 and 1997, Seligman Services received commissions in the
following amounts:
19
<PAGE>
Commissions Paid
to
Seligman Services
Fund 1999 1998 1997
- ---- ---- ---- ----
Emerging Markets Fund $ 1,112 $ 647 $ 7,957
Global Growth Fund 1,425 10,047 1,921
Global Smaller Companies Fund 3,405 45,438 35,359
Global Technology Fund 19,032 90,491 38,720
International Growth Fund -0- 8,971 1,009
Rule 12b-1 Plans
Each Fund has adopted an Administration, Shareholder Services and Distribution
Plan (12b-1 Plan) in accordance with Section 12(b) of the 1940 Act and Rule
12b-1 thereunder.
Under its 12b-1 Plan, each Fund may pay to Seligman Advisors an administration,
shareholder services and distribution fee in respect of the Fund's Class A,
Class B, Class C, and Class D shares. Payments under the 12b-1 Plan may include,
but are not limited to: (1) compensation to securities dealers and other
organizations (Service Organizations) for providing distribution assistance with
respect to assets invested in the Fund; (2) compensation to Service
Organizations for providing administration, accounting and other shareholder
services with respect to Fund shareholders; and (3) otherwise promoting the sale
of shares of the Fund, including paying for the preparation of advertising and
sales literature and the printing and distribution of such promotional materials
and prospectuses to prospective investors and defraying Seligman Advisors' costs
incurred in connection with its marketing efforts with respect to shares of the
Fund. Seligman, in its sole discretion, may also make similar payments to
Seligman Advisors from its own resources, which may include the management fee
that Seligman receives from each Fund. Payments made by each Fund under its Rule
12b-1 Plan are intended to be used to encourage sales of such Fund, as well as
to discourage redemptions.
Fees paid by each Fund under its 12b-1 Plan with respect to any class of shares
may not be used to pay expenses incurred solely in respect of any other class or
any other Seligman fund. Expenses attributable to more than one class of a Fund
are allocated between the classes in accordance with a methodology approved by
the Funds' Board of Directors. Each Fund may participate in joint distribution
activities with other Seligman funds, and the expenses of such activities will
be allocated among the applicable funds based on relative sales, in accordance
with a methodology approved by the Board.
Class A
Under its 12b-1 Plan, each Fund, with respect to Class A shares, pays quarterly
to Seligman Advisors a service fee at an annual rate of up to .25% of the
average daily net asset value of the Class A shares. This fee is used by
Seligman Advisors exclusively to make payments to Service Organizations which
have entered into agreements with Seligman Advisors. Such Service Organizations
receive from Seligman Advisors a continuing service fee of up to .25% on an
annual basis, payable quarterly, of the average daily net assets of Class A
shares attributable to the particular Service Organization for providing
personal service and/or maintenance of shareholder accounts. The fee payable to
Service Organizations from time to time shall, within such limits, be determined
by the Directors. The Funds are not obligated to pay Seligman Advisors for any
such costs it incurs in excess of the fee described above. No expenses incurred
in one fiscal year by Seligman Advisors with respect to Class A shares of a Fund
may be paid from Class A 12b-1 fees received from that Fund in any other fiscal
year. If a Fund's 12b-1 Plan is terminated in respect of Class A shares, no
amounts (other than amounts accrued but not yet paid) would be owed by that Fund
to Seligman Advisors with respect to Class A shares. The total amount paid by
each Fund to Seligman Advisors in respect of Class A shares for the fiscal year
ended October 31, 1999 and such amounts as a percentage of Class A shares'
average daily net assets, were as follows:
20
<PAGE>
Total % of Average
Fund Fees Paid Net Assets
---- --------- ----------
Emerging Markets Fund $ 68,209 0.25%
Global Growth Fund 279,246 0.25
Global Smaller Companies Fund 678,107 0.25
Global Technology Fund 1,543,038 0.25
International Growth Fund 103,943 0.24
Class B
Under its 12b-1 Plan, each Fund, with respect to Class B shares, pays monthly a
12b-1 fee at an annual rate of up to 1% of the average daily net asset value of
the Class B shares. This fee is comprised of (1) a distribution fee equal to
.75% per annum, which is paid directly to a third party, FEP Capital, L.P., to
compensate it for having funded, at the time of sale of Class B shares (i) a 4%
sales commission to Service Organizations and (ii) a payment of up to .25% of
sales to Seligman Advisors to help defray its costs of distributing Class B
shares; and (2) a service fee of up to .25% per annum which is paid to Seligman
Advisors. The service fee is used by Seligman Advisors exclusively to make
payments to Service Organizations, which have entered into agreements with
Seligman Advisors. Such Service Organizations receive from Seligman Advisors a
continuing service fee of up to .25% on an annual basis, payable quarterly, of
the average daily net assets of Class B shares attributable to the particular
Service Organization for providing personal service and/or maintenance of
shareholder accounts. The amounts expended by Seligman Advisors or FEP Capital,
L.P. in any one year upon the initial purchase of Class B shares of a Fund may
exceed the 12b-1 fees paid by that Fund in that year. Each Fund's 12b-1 Plan
permits expenses incurred in respect of Class B shares in one fiscal year to be
paid from Class B 12b-1 fees received from the Fund in any other fiscal year;
however, in any fiscal year the Funds are not obligated to pay any 12b-1 fees in
excess of the fees described above. Seligman Advisors and FEP Capital, L.P. are
not reimbursed for expenses which exceed such fees. If a Fund's 12b-1 Plan is
terminated in respect of Class B shares, no amounts (other than amounts accrued
but not yet paid) would be owed by that Fund to Seligman Advisors or FEP
Capital, L.P. with respect to Class B shares. The total amount paid by each Fund
in respect of Class B shares for the fiscal year ended October 31, 1999, was
equal to 1% per annum of the Class B shares' average daily net assets, as
follows:
Total
Fund Fees Paid
---- ---------
Emerging Markets Fund $162,219
Global Growth Fund 290,077
Global Smaller Companies Fund 1,873,413
Global Technology Fund 826,302
International Growth Fund 105,777
Class C
Under the 12b-1 Plan, each Fund, with respect to Class C shares, pays monthly to
Seligman Advisors a 12b-1 fee at an annual rate of up to 1% of the average daily
net asset value of the Class C shares. This fee is used by Seligman Advisors as
follows: During the first year following the sale of Class C shares, a
distribution fee of .75% of the average daily net assets attributable to Class C
shares is used, along with any CDSC proceeds during the first eighteen months,
to (1) reimburse Seligman Advisors for its payment at the time of sale of Class
C shares of a 1.25% sales commission to Service Organizations, and (2) pay for
other distribution expenses, including paying for the preparation of advertising
and sales literature and the printing and distribution of such promotional
materials and prospectuses to prospective investors and other marketing costs of
Seligman Advisors. In addition, during the first year following the sale of
Class C shares, a service fee of up to .25% of the average daily net assets
attributable to such Class C shares is used to reimburse Seligman Advisors for
its prepayment to Service Organizations at the time of sale of Class C shares of
a service fee of .25% of the net asset value of the Class C shares sold (for
shareholder services to be provided to Class C shareholders over the course of
the one year immediately following the sale). The payment of service fees to
Seligman Advisors is limited to amounts Seligman Advisors actually paid to
Service Organizations at the time of sale as service fees. After the initial
one-year period following a sale of Class C shares, the entire 12b-1 fee
attributable to such Class C shares is paid to Service Organizations for
providing continuing shareholder services and distribution assistance in respect
of the
21
<PAGE>
Funds. The total amount paid by each Fund to Seligman Advisors in respect of
Class C shares from May 27, 1999 (inception) to October 31, 1999 was equal to 1%
per annum of the Class C shares' average daily net assets, as follows:
Total
Fund Fees Paid
---- ---------
Emerging Markets Fund $709
Global Growth Fund 1,951
Global Smaller Companies Fund 686
Global Technology Fund 9,367
International Growth Fund 1,361
The amounts expended by Seligman Advisors in any one year with respect to Class
C shares of a Fund may exceed 12b-1 fees paid by the Fund in that year. Each
Fund's 12b-1 Plan permits expenses incurred by Seligman Advisors in respect of
Class C shares in one fiscal year to be paid from Class C 12b-1 fees received
from the Fund in any other fiscal year; however, in any fiscal year the Funds
are not obligated to pay any 12b-1 fees in excess of the fees described above.
As of September 30, 1999 (the most recent calendar quarter for which such
information was reported), Seligman Advisors incurred the following amounts of
unreimbursed expenses in respect of each Fund's Class C shares:
Amount of % of the
Unreimbursed Expenses Net Assets of
Incurred with Respect Class C at
Fund to Class C Shares September 30, 1999
---- ----------------- ------------------
Emerging Markets Fund $ 4,212 1.60%
Global Growth Fund 12,887 1.48
Global Smaller Companies Fund 4,184 1.48
Global Technology Fund 57,937 1.36
International Growth Fund 10,018 1.47
If the 12b-1 Plan is terminated in respect to Class C shares of the Funds, no
amounts (other than amounts accrued but not yet paid) would be owed by that Fund
to Seligman Advisors with respect to Class C shares.
Class D
Under its 12b-1 Plan, each Fund, with respect to Class D shares, pays monthly to
Seligman Advisors a 12b-1 fee at an annual rate of up to 1% of the average daily
net asset value of Class D shares. This fee is used by Seligman Advisors, as
follows: During the first year following the sale of Class D shares, a
distribution fee of .75% of the average daily net assets attributable to such
Class D shares is used, along with any CDSC proceeds, to (1) reimburse Seligman
Advisors for its payment at the time of sale of Class D shares of a .75% sales
commission to Service Organizations, and (2) pay for other distribution
expenses, including paying for the preparation of advertising and sales
literature and the printing and distribution of such promotional materials and
prospectuses to prospective investors and other marketing costs of Seligman
Advisors. In addition, during the first year following the sale of Class D
shares, a service fee of up to .25% of the average daily net assets attributable
to such Class D shares is used to reimburse Seligman Advisors for its prepayment
to Service Organizations at the time of sale of Class D shares of a service fee
of .25% of the net asset value of the Class D shares sold (for shareholder
services to be provided to Class D shareholders over the course of the one year
immediately following the sale). The payment of service fees to Seligman
Advisors is limited to amounts Seligman Advisors actually paid to Service
Organizations at the time of sale as service fees. After the initial one-year
period following a sale of Class D shares, the entire 12b-1 fee attributable to
such Class D shares is paid to Service Organizations for providing continuing
shareholder services and distribution assistance in respect of each Fund. The
total amount paid by each Fund to Seligman Advisors in respect of Class D shares
for the fiscal year ended October 31, 1999 was equal to 1% per annum of the
Class D shares' average daily net assets, as follows:
22
<PAGE>
Total
Fund Fees Paid
---- ---------
Emerging Markets Fund $133,737
Global Growth Fund 725,528
Global Smaller Companies Fund 2,145,218
Global Technology Fund 2,357,023
International Growth Fund 371,408
The amounts expended by Seligman Advisors in any one year with respect to Class
D shares of a Fund may exceed 12b-1 fees paid by the Fund in that year. Each
Fund's 12b-1 Plan permits expenses incurred by Seligman Advisors in respect of
Class D shares in one fiscal year to be paid from Class D 12b-1 fees received
from the Fund in any other fiscal year; however, in any fiscal year the Funds
are not obligated to pay any 12b-1 fees in excess of the fees described above.
As of September 30, 1999 (the most recent calendar quarter for which such
information was reported), Seligman Advisors incurred the following amounts of
unreimbursed expenses in respect of each Fund's Class D shares:
Amount of % of the
Unreimbursed Expenses Net Assets of
Incurred with Respect Class D at
Fund to Class D Shares September 30, 1999
---- ----------------- ------------------
Emerging Markets Fund $ 8,308 0.06%
Global Growth Fund -0- -0-
Global Smaller Companies Fund 560,537 0.33
Global Technology Fund 15,521 0.01
International Growth Fund 15,894 0.05
If a Fund's 12b-1 Plan is terminated in respect of Class D shares, no amounts
(other than amounts accrued but not yet paid) would be owed by that Fund to
Seligman Advisors with respect to Class D shares.
Payments made by each Fund under its 12b-1 Plan in respect of Class A, Class B
and Class D shares for the fiscal year ended October 31, 1999, and in respect of
Class C shares from May 27, 1999 (inception) to October 31, 1999, were spent on
the following activities in the following amounts:
<TABLE>
<CAPTION>
Compensation to Compensation to Other
Fund/Class Underwriters Broker/Dealers Compensation*
- ---------- ------------ -------------- -------------
<S> <C> <C> <C>
Emerging Markets Fund/Class A -0- $68,209 -0-
Emerging Markets Fund/Class B -0- 40,517 $121,702
Emerging Markets Fund/Class C $ 709 -0- -0-
Emerging Markets Fund/Class D 26,936 106,801 -0-
Global Growth Fund/Class A -0- $279,246 -0-
Global Growth Fund/Class B -0- 72,555 $217,522
Global Growth Fund/Class C $ 1,951 -0- -0-
Global Growth Fund/Class D 124,449 601,079 -0-
Global Smaller Companies Fund/Class A -0- $678,107 -0-
Global Smaller Companies Fund/Class B -0- 468,312 $1,405,101
Global Smaller Companies Fund/Class C $ 686 -0- -0-
Global Smaller Companies Fund/Class D 331,572 1,813,646 -0-
Global Technology Fund/Class A -0- $1,543,038 -0-
Global Technology Fund/Class B -0- 206,541 $619,761
Global Technology Fund/Class C $ 9,367 -0- -0-
Global Technology Fund/Class D 358,392 1,998,631 -0-
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
Compensation to Compensation to Other
Fund/Class Underwriters Broker/Dealers Compensation*
- ---------- ------------ -------------- -------------
<S> <C> <C> <C>
International Growth Fund/Class A -0- $103,943 -0-
International Growth Fund/Class B -0- 26,457 $79,320
International Growth Fund/Class C $1,361 -0- -0-
International Growth Fund/Class D 82,653 288,755 -0-
</TABLE>
* Payment is made to FEP Capital, L. P. to compensate it for having funded at
the time of sale, payments to broker/dealers and underwriters.
The 12b-1 Plan with respect to the International Growth Fund was originally
approved on July 15, 1993 by the Board of Directors, including a majority of the
Directors who are not "interested persons" (as defined in the 1940 Act) and who
have no direct or indirect financial interest in the operation of the Fund
(Qualified Directors) and by the shareholders of such Fund on September 21,
1993. The 12b-1 Plan with respect to the Emerging Markets Fund was originally
approved on March 21, 1996 by the Board of Directors, including a majority of
the Qualified Directors, and by the sole shareholder of each Class of shares of
the Fund on May 10, 1996. The 12b-1 Plan with respect to the Global Growth Fund
was originally approved on September 21, 1995 by the Board of Directors,
including a majority of the Qualified Directors, and by the sole shareholder of
such Fund on October 30, 1995. The 12b-1 Plan with respect to the Global Smaller
Companies Fund was originally approved on July 16, 1992 by the Board of
Directors, including a majority of the Qualified Directors. Amendments to the
12b-1 Plan in respect of Class D shares of the Global Smaller Companies Fund
were approved by the Board of Directors of the Fund, including a majority of the
Qualified Directors, on March 18, 1993 and the amended 12b-1 Plan was approved
by the shareholders of the Global Smaller Companies Fund on May 20, 1993. The
12b-1 Plan with respect to the Global Technology Fund was originally approved on
March 17, 1994 by the Board of Directors, including a majority of the Qualified
Directors, and by the sole shareholder of such Fund on that date. The 12b-1
Plans were approved in respect of the Class B shares of each Fund other than the
Emerging Markets Fund on March 21, 1996 by the Board of Directors, including a
majority of the Qualified Directors, and by the sole shareholder of each such
Fund's Class B shares on that date, and became effective in respect of such
Class B shares on April 22, 1996. In addition, the 12b-1 Plans were approved
with respect of Class C shares of each Fund on May 20, 1999 by the Directors,
including a majority of the Qualified Directors, and became effective in respect
of each Fund's Class C shares on June 1, 1999.
The 12b-1 Plans will continue in effect through December 31 of each year so long
as such continuance is approved annually by a majority vote of both the
Directors and the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. No material amendment to the 12b-1 Plans
may be made except by a majority of both the Directors and Qualified Directors.
The 12b-1 Plans may not be amended to increase materially the amounts payable to
Service Organizations with respect to a Class without the approval of a majority
of the outstanding voting securities of such Class. If the amount payable in
respect of Class A shares under a Fund's 12b-1 Plan is proposed to be increased
materially, the Fund will either (i) permit holders of Class B shares to vote as
a separate class on the proposed increase or (ii) establish a new class of
shares subject to the same payment under the 12b-1 Plan as existing Class A
shares, in which case Class B shares will thereafter convert into the new class
instead of into Class A shares.
The 12b-1 Plans require that the Treasurer of the Funds shall provide to the
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended (and purposes therefor) under the 12b-1 Plans. Rule
12b-1 also requires that the selection and nomination of Directors who are not
"interested persons" of the Funds be made by such disinterested Directors. The
12b-1 Plans are reviewed by the Directors annually.
Seligman Services acts as a broker/dealer of record for shareholder accounts
that do not have a designated financial advisor. As such, it receives
compensation from each Fund pursuant to its 12b-1 Plan for providing personal
services and account maintenance to such accounts and other distribution
services. For the fiscal years ended October 31, 1999, 1998 and 1997, Seligman
Services received distribution and service fees from each Fund pursuant to its
12b-1 Plan as follows:
24
<PAGE>
Distribution and Service Fees
Paid to
Seligman Services
--------------------------------
Fund 1999 1998 1997
---- -------- -------- --------
Emerging Markets Fund $ 5,507 $ 6,219 $ 5,900
Global Growth Fund 10,216 2,295 6,876
Global Smaller Companies Fund 34,166 11,939 45,222
Global Technology Fund 110,774 26,484 86,328
International Growth Fund 17,810 20,727 18,533
Brokerage Allocation and Other Practices
Brokerage Transactions
Seligman and HIML will seek the most favorable price and execution in the
purchase and sale of portfolio securities of each Fund. When two or more of the
investment companies in the Seligman Group or other investment advisory clients
of Seligman or HIML desire to buy or sell the same security at the same time,
the securities purchased or sold are allocated by Seligman or HIML in a manner
believed to be equitable to each. There may be possible advantages or
disadvantages of such transactions with respect to price or the size of
positions readily obtainable or saleable.
In over-the-counter markets, the Funds deal with responsible primary market
makers unless a more favorable execution or price is believed to be obtainable.
Each Fund may buy securities from or sell securities to dealers acting as
principal, except dealers with which its directors and/or officers are
affiliated.
For the fiscal years ended October 31, 1999, 1998 and 1997, the Funds paid total
brokerage commissions to others for execution, research and statistical services
in the following amounts:
Total Brokerage
Commissions Paid
------------------------------------
Fund 1999 1998 1997
---- ---------- ---------- ----------
Emerging Markets Fund $ 377,148 $ 392,683 $ 419,950
Global Growth Fund 415,319 378,349 585,985
Global Smaller Companies Fund 2,120,777 1,801,953 1,910,979
Global Technology Fund 1,252,711 1,234,913 936,431
International Growth Fund 324,394 344,771 409,545
Commissions
For the fiscal years ended October 31, 1999, 1998 and 1997, the Funds did not
execute any portfolio transactions with, and therefore did not pay any
commissions to, any broker affiliated with the Funds, Seligman, HIML, or
Seligman Advisors.
Brokerage Selection
Consistent with seeking the most favorable price and execution when buying or
selling portfolio securities, Seligman may give consideration to the research,
statistical, and other services furnished by brokers or dealers to Seligman for
its use, as well as the general attitude toward and support of investment
companies demonstrated by such brokers or dealers. Such services include
supplemental investment research, analysis, and reports concerning issuers,
industries, and securities deemed by Seligman to be beneficial to the Funds. In
addition, Seligman is authorized to place orders with brokers who provide
supplemental investment and market research and security and economic analysis
although the use of such brokers may result in a higher brokerage charge to a
Fund than the use of brokers selected solely on the basis of seeking the most
favorable price and execution and although such research and analysis may be
useful to Seligman in connection with its services to clients other than the
Funds.
25
<PAGE>
Directed Brokerage
During the Funds' fiscal year ended October 31, 1999, neither the Funds,
Seligman, nor HIML directed any of the Funds' brokerage transactions to a broker
because of research services provided.
Regular Broker-Dealers
During the Funds' fiscal year ended October 31, 1999, the Funds did not acquire
securities of any of their regular brokers or dealers (as defined in Rule 10b-1
under the 1940 Act) or of their parents.
Capital Stock and Other Securities
Capital Stock
Seligman Global Fund Series, Inc. is authorized to issue 2,000,000,000 shares of
common stock, each with a par value of $.001 each, divided into five different
series, which represents each of the Funds. Each Fund has four classes,
designated Class A common stock, Class B common stock, Class C common stock, and
Class D common stock. Each share of a Fund's Class A, Class B, Class C, and
Class D common stock is equal as to earnings, assets, and voting privileges,
except that each Class bears its own separate distribution and, potentially,
certain other class expenses and has exclusive voting rights with respect to any
matter to which a separate vote of any class is required by the 1940 Act or
Maryland law. Seligman Global Fund Series, Inc. has adopted a multiclass plan
pursuant to Rule 18f-3 under the 1940 Act permitting the issuance and sale of
multiple classes of common stock. In accordance with the Articles of
Incorporation, the Board of Directors may authorize the creation of additional
classes of common stock with such characteristics as are permitted by the
multiclass plan and Rule 18f-3. The 1940 Act requires that where more than one
class exists, each class must be preferred over all other classes in respect of
assets specifically allocated to such class. All shares have noncumulative
voting rights for the election of directors. Each outstanding share is fully
paid and non-assessable, and each is freely transferable. There are no
liquidation, conversion, or preemptive rights.
Other Securities
Seligman Global Fund Series, Inc. has no authorized securities other than common
stock.
Purchase, Redemption, and Pricing of Shares
Purchase of Shares
Class A
Class A shares may be purchased at a price equal to the next determined net
asset value per share, plus an initial sales charge.
Purchases of Class A shares by a "single person" (as defined below under
"Persons Entitled to Reductions") may be eligible for the following reductions
in initial sales charges:
Volume Discounts are provided if the total amount being invested in Class A
shares of a Fund alone, or in any combination of shares of the other mutual
funds in the Seligman Group which are sold with an initial sales charge, reaches
levels indicated in the sales charge schedule set forth in the Prospectus.
The Right of Accumulation allows an investor to combine the amount being
invested in Class A shares of a Fund and shares of the other Seligman mutual
funds sold with an initial sales charge with the total net asset value of shares
of those mutual funds already owned that were sold with an initial sales charge
and the total net asset value of shares of Seligman Cash Management Fund which
were acquired through an exchange of shares of another Seligman mutual fund on
which there was an initial sales charge at the time of purchase to determine
reduced sales charges in accordance with the schedule in the prospectus. The
value of the shares owned, including the value of shares of Seligman Cash
Management Fund acquired in an exchange of shares of another Seligman mutual
fund on which there was an initial sales charge at the time of purchase will be
taken into account in orders placed
26
<PAGE>
through a dealer, however, only if Seligman Advisors is notified by an investor
or a dealer of the amount owned by the investor at the time the purchase is made
and is furnished sufficient information to permit confirmation.
A Letter of Intent allows an investor to purchase Class A shares over a 13-month
period at reduced initial sales charges in accordance with the schedule in the
Prospectus, based on the total amount of Class A shares of the Fund that the
letter states the investor intends to purchase plus the total net asset value of
shares that were sold with an initial sales charge of the other Seligman mutual
funds already owned and the total net asset value of shares of Seligman Cash
Management Fund which were acquired through an exchange of shares of another
Seligman mutual fund on which there was an initial sales charge at the time of
purchase. Reduced sales charges also may apply to purchases made within a
13-month period starting up to 90 days before the date of execution of a letter
of intent.
Persons Entitled To Reductions. Reductions in initial sales charges apply to
purchases of Class A shares by a "single person," including an individual;
members of a family unit comprising husband, wife and minor children; or a
trustee or other fiduciary purchasing for a single fiduciary account. Employee
benefit plans qualified under Section 401 of the Internal Revenue Code of 1986,
as amended, organizations tax exempt under Section 501(c)(3) or (13) of the
Internal Revenue Code, and non-qualified employee benefit plans that satisfy
uniform criteria are considered "single persons" for this purpose. The uniform
criteria are as follows:
1. Employees must authorize the employer, if requested by a Fund, to
receive in bulk and to distribute to each participant on a timely basis the Fund
prospectus, reports, and other shareholder communications.
2. Employees participating in a plan will be expected to make regular
periodic investments (at least annually). A participant who fails to make such
investments may be dropped from the plan by the employer or the Fund 12 months
and 30 days after the last regular investment in his account. In such event, the
dropped participant would lose the discount on share purchases to which the plan
might then be entitled.
3. The employer must solicit its employees for participation in such an
employee benefit plan or authorize and assist an investment dealer in making
enrollment solicitations.
Eligible Employee Benefit Plans. The table of sales charges in the Prospectus
applies to sales to "eligible employee benefit plans," except that the Fund may
sell shares at net asset value to "eligible employee benefit plans" which have
at least (1) $500,000 invested in the Seligman Group of mutual funds or (2) 50
eligible employees to whom such plan is made available. Such sales must be made
in connection with a payroll deduction system of plan funding or other systems
acceptable to Seligman Data Corp., the Funds' shareholder service agent.
"Eligible employee benefit plan" means any plan or arrangement, whether or not
tax qualified, which provides for the purchase of Fund shares. Sales of shares
to such plans must be made in connection with a payroll deduction system of plan
funding or other system acceptable to Seligman Data Corp. Section 403(b) Plans
sponsored by public educational institutions are not eligible for net asset
value purchases based on the aggregate investment made by the plan or member of
eligible employees.
Such sales are believed to require limited sales effort and sales-related
expenses and therefore are made at net asset value. Contributions or account
information for plan participation also should be transmitted to Seligman Data
Corp. by methods which it accepts. Additional information about "eligible
employee benefit plans" is available from financial advisors or Seligman
Advisors.
Further Types of Reductions. Class A shares may also be issued without an
initial sales charge in the following instances:
(1) to any registered unit investment trust which is the issuer of periodic
payment plan certificates, the net proceeds of which are invested in Fund
shares;
(2) to separate accounts established and maintained by an insurance company
which are exempt from registration under Section 3(c)(11) of the 1940 Act;
(3) to registered representatives and employees (and their spouses and minor
children) of any dealer that has a sales agreement with Seligman Advisors;
27
<PAGE>
(4) to financial institution trust departments;
(5) to registered investment advisers exercising discretionary investment
authority with respect to the purchase of Fund shares;
(6) to accounts of financial institutions or broker/dealers that charge account
management fees, provided Seligman or one of its affiliates has entered
into an agreement with respect to such accounts;
(7) pursuant to sponsored arrangements with organizations which make
recommendations to, or permit group solicitations of, its employees,
members or participants in connection with the purchase of shares of the
Fund;
(8) to other investment companies in the Seligman Group in connection with a
deferred fee arrangement for outside directors;
(9) to certain "eligible employee benefit plans" as discussed above;
(10) to those partners and employees of outside counsel to the Fund or its
directors or trustees who regularly provide advice and services to the
Fund, to other funds managed by Seligman, or to their directors or
trustees; and
(11) in connection with sales pursuant to a 401(k) alliance program which has an
agreement with Seligman Advisors.
CDSC Applicable to Class A Shares. Class A shares purchased without an initial
sales charge in accordance with the sales charge schedule in the Funds'
Prospectus, or pursuant to a Volume Discount, Right of Accumulation, or Letter
of Intent are subject to a CDSC of 1% on redemptions of such shares within
eighteen months of purchase. Employee benefit plans eligible for net asset value
sales (as described below) may be subject to a CDSC of 1% for terminations at
the plan level only, on redemptions of shares purchased within eighteen months
prior to plan termination. The 1% CDSC will be waived on shares that were
purchased through Morgan Stanley Dean Witter & Co. by certain Chilean
institutional investors (i.e. pension plans, insurance companies, and mutual
funds). Upon redemption of such shares within an eighteen month period, Morgan
Stanley Dean Witter will reimburse Seligman Advisors a pro rata portion of the
fee it received from Seligman Advisors at the time of sale of such shares.
See "CDSC Waivers" below for other waivers which may be applicable to Class A
shares.
Class B
Class B shares may be purchased at a price equal to the next determined net
asset value, without an initial sales charge. However, Class B shares are
subject to a CDSC if the shares are redeemed within six years of purchase at
rates set forth in the table below, charged as a percentage of the current net
asset value or the original purchase price, whichever is less.
Years Since Purchase CDSC
- -------------------- ----
Less than 1 year .......................................... 5%
1 year or more but less than 2 years ...................... 4%
2 years or more but less than 3 years ..................... 3%
3 years or more but less than 4 years ..................... 3%
4 years or more but less than 5 years ..................... 2%
5 years or more but less than 6 years ..................... 1%
6 years or more ........................................... 0%
Approximately eight years after purchase, Class B shares will convert
automatically to Class A shares. Shares purchased through reinvestment of
dividends and distributions on Class B shares also will convert automatically to
Class A shares along with the underlying shares on which they were earned.
28
<PAGE>
Conversion occurs at the end of the month which precedes the eighth anniversary
of the purchase date. If Class B shares of the Fund are exchanged for Class B
shares of another Seligman Mutual Fund, the conversion period applicable to the
Class B shares acquired in the exchange will apply, and the holding period of
the shares exchanged will be tacked onto the holding period of the shares
acquired. Class B shareholders of the Fund exercising the exchange privilege
will continue to be subject to the Fund's CDSC schedule if such schedule is
higher or longer than the CDSC schedule relating to the new Class B shares. In
addition, Class B shares of the Fund acquired by exchange will be subject to the
Fund's CDSC schedule if such schedule is higher or longer than the CDSC schedule
relating to the Class B shares of the Seligman mutual fund from which the
exchange has been made.
Class C
Class C shares may be purchased at a price equal to the next determined net
asset value, plus an initial sales charge. Purchases of Class C shares by a
"single person" may be eligible for the reductions in initial sales charges
described above for Class A shares. Class C shares are subject to a CDSC of 1%
if the shares are redeemed within eighteen months of purchase, charged as a
percentage of the current net asset value or the original purchase price,
whichever is less.
Class D
Class D shares may be purchased at a price equal to the next determined net
asset value, without an initial sales charge. However, Class D shares are
subject to a CDSC of 1% if the shares are redeemed within one year of purchase,
charged as a percentage of the current net asset value or the original purchase
price, whichever is less. Unlike Class B shares, Class D shares do not
automatically convert to Class A shares after eight years.
Systematic Withdrawals. Class B, Class C and Class D shareholders who reinvest
both their dividends and capital gain distributions to purchase additional
shares of a Fund may use the Systematic Withdrawal Plan to withdraw up to 12%,
10%, and 10%, respectively, of the value of their accounts per year without the
imposition of a CDSC. Account value is determined as of the date the systematic
withdrawals begin.
CDSC Waivers. The CDSC on Class B, Class C and Class D shares (and certain Class
A shares, as discussed above) will be waived or reduced in the following
instances:
(1) on redemptions following the death or disability (as defined in Section
72(m)(7) of the Internal Revenue Code) of a shareholder or beneficial
owner;
(2) in connection with (1) distributions from retirement plans qualified under
Section 401(a) of the Internal Revenue Code when such redemptions are
necessary to make distributions to plan participants (such payments
include, but are not limited to, death, disability, retirement, or
separation of service), (2) distributions from a custodial account under
Section 403(b)(7) of the Internal Revenue Code or an IRA due to death,
disability, minimum distribution requirements after attainment of age 70
1/2 or, for accounts established prior to January 1, 1998, attainment of
age 59 1/2, and (3) a tax-free return of an excess contribution to an IRA;
(3) in whole or in part, in connection with shares sold to current and retired
Directors of the Funds;
(4) in whole or in part, in connection with shares sold to any state, county,
or city or any instrumentality, department, authority, or agency thereof,
which is prohibited by applicable investment laws from paying a sales load
or commission in connection with the purchase of any registered investment
management company;
(5) in whole or in part, in connection with systematic withdrawals;
(6) in connection with participation in the Merrill Lynch Small Market 401(k)
Program.
If, with respect to a redemption of any Class A, Class B, Class C or Class D
shares sold by a dealer, the CDSC is waived because the redemption qualifies for
a waiver as set forth above, the dealer shall remit to Seligman Advisors
promptly upon notice, an amount equal to the payment or a portion of the payment
made by Seligman Advisors at the time of sale of such shares.
29
<PAGE>
Payment in Securities. In addition to cash, the Funds may accept securities in
payment for Fund shares sold at the applicable public offering price (net asset
value and, if applicable, any sales charge), although the Funds do not presently
intend to accept securities in payment for Fund shares. Generally, a Fund will
only consider accepting securities (l) to increase its holdings in a portfolio
security, or (2) if Seligman determines that the offered securities are a
suitable investment for the Fund and in a sufficient amount for efficient
management. Although no minimum has been established, it is expected that a Fund
would not accept securities with a value of less than $100,000 per issue in
payment for shares. A Fund may reject in whole or in part offers to pay for Fund
shares with securities, may require partial payment in cash for applicable sales
charges, and may discontinue accepting securities as payment for Fund shares at
any time without notice. The Funds will not accept restricted securities in
payment for shares. The Funds will value accepted securities in the manner
provided for valuing portfolio securities.
Fund Reorganizations
Class A shares and Class C shares may be issued without an initial sales charge
in connection with the acquisition of cash and securities owned by other
investment companies. Any CDSC will be waived in connection with the redemption
of shares of a Fund if the Fund is combined with another Seligman mutual fund,
or in connection with a similar reorganization transaction.
Offering Price
When you buy or sell Fund shares, you do so at the Class's net asset value (NAV)
next calculated after Seligman Advisors accepts your request. Any applicable
sales charge will be added to the purchase price for Class A shares and Class C
shares.
NAV per share of each class of a Fund is determined as of the close of regular
trading on the New York Stock Exchange (normally, 4:00 p.m. Eastern time), on
each day that the NYSE is open for business. The NYSE is currently closed on New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. A Fund
will also determine NAV for each class on each day in which there is a
sufficient degree of trading in the Fund's portfolio securities that the NAV of
Fund shares might be materially affected. NAV per share for a class is computed
by dividing such class's share of the value of the net assets of the Fund (i.e.,
the value of its assets less liabilities) by the total number of outstanding
shares of such class. All expenses of the Fund, including the management fee,
are accrued daily and taken into account for the purpose of determining NAV. The
NAV of Class B, Class C, and Class D shares will generally be lower than the NAV
of Class A shares as a result of the higher 12b-1 fees with respect to such
shares.
Portfolio securities, including open short positions and options written, are
valued at the last sale price on the securities exchange or securities market on
which such securities primarily are traded. Securities traded on a foreign
exchange or over-the-counter market are valued at the last sales price on the
primary exchange or market on which they are traded. United Kingdom securities
and securities for which there are not recent sales transactions are valued
based on quotations provided by primary market makers in such securities. Other
securities not listed on an exchange or securities market, or securities in
which there were no transactions, are valued at the average of the most recent
bid and asked price, except in the case of open short positions where the asked
price is available. Any securities or other assets for which recent market
quotations are not readily available are valued at fair value as determined in
accordance with procedures approved by the Board of Directors. Short-term
obligations with less than 60 days remaining to maturity are generally valued at
amortized cost. Short-term obligations with more than 60 days remaining to
maturity will be valued at current market value until the sixtieth day prior to
maturity, and will then be valued on an amortized cost basis based on the value
on such date unless the Board determines that this amortized cost value does not
represent fair market value.
Generally, trading in foreign securities, as well as US Government securities,
money market instruments and repurchase agreements, is substantially completed
each day at various times prior to the close of regular trading on the NYSE. The
values of such securities used in computing the net asset value of the shares of
each Fund are determined as of such times. Foreign currency exchange rates are
also generally determined prior to the close of regular trading on the NYSE.
30
<PAGE>
For purposes of determining the net asset value per share of a Fund, all assets
and liabilities initially expressed in foreign currencies will be converted into
US dollars at the mean between the bid and offer prices of such currencies
against US dollars quoted by a major bank that is a regular participant in the
foreign exchange market or on the basis of a pricing service that takes into
account the quotes provided by a number of such major banks.
Specimen Price Make-Up
Under the current distribution arrangements between the Funds and Seligman
Advisors, Class A shares and Class C shares are sold with a maximum initial
sales charge of 4.75% and 1.00%(1), respectively, and Class B and Class D shares
are sold at NAV(2). Using each Class's NAV at October 31, 1999, the maximum
offering price of each Fund's shares is as follows:
<TABLE>
<CAPTION>
Class A
Global
Emerging Global Smaller Global International
Markets Growth Companies Technology Growth
Fund Fund Fund Fund Fund
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value per share $ 6.69 $ 12.86 $ 15.74 $ 23.36 $ 21.47
Maximum sales charge (4.75% of
Offering price) ................ .33 .64 .78 1.16 1.07
--------- --------- --------- --------- ---------
Offering price to public ......... $ 7.02 $ 13.50 $ 16.52 $ 24.52 $ 22.54
========= ========= ========= ========= =========
<CAPTION>
Class B
Global
Emerging Global Smaller Global International
Markets Growth Companies Technology Growth
Fund Fund Fund Fund Fund
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value and
Offering price per share(2) .... $ 6.52 $ 12.47 $ 14.90 $ 22.26 $ 20.33
========= ========= ========= ========= =========
<CAPTION>
Class C
Global
Emerging Global Smaller Global International
Markets Growth Companies Technology Growth
Fund Fund Fund Fund Fund
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value per share $ 6.52 $ 12.47 $ 14.91 $ 22.23 $ 20.31
Maximum sales charge (1.00% of
Offering price(1)) ............. .07 .13 .15 .22 .21
--------- --------- --------- --------- ---------
Offering price to public ......... $ 6.59 $ 12.60 $ 15.06 $ 22.45 $ 20.52
========= ========= ========= ========= =========
Class D
Global
Emerging Global Smaller Global International
Markets Growth Companies Technology Growth
Fund Fund Fund Fund Fund
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value and
Offering price per share(2) .... $ 6.52 $ 12.47 $ 14.91 $ 22.23 $ 20.31
========= ========= ========= ========= =========
</TABLE>
- ---------
(1) In addition to the front-end sales charge of 1.00%, Class C shares are
subject to a 1% CDSC if you redeem your shares within 18 months of
purchase.
(2) Class B shares are subject to a CDSC, declining from 5% in the first year
after purchase to 0% after six years. Class D shares are also subject to a
1% CDSC if you redeem your shares within one year of purchase.
31
<PAGE>
Redemption in Kind
The procedures for selling Fund shares under ordinary circumstances are set
forth in the Prospectus. In unusual circumstances, payment may be postponed, or
the right of redemption postponed for more than seven days, if the orderly
liquidation of portfolio securities is prevented by the closing of, or
restricted trading on, the NYSE during periods of emergency, or such other
periods as ordered by the SEC. Under these circumstances, redemption proceeds
may be made in securities. If payment is made in securities, a shareholder may
incur brokerage expenses in converting these securities to cash.
Taxation of the Funds
Foreign Income Taxes. Investment income received by the Fund from sources within
foreign countries may be subject to foreign income taxes withheld at source. The
United States has entered into tax treaties with many foreign countries which
entitle the Fund to a reduced rate of such taxes or exemption from taxes on such
income. It is impossible to determine the effective rate of foreign tax in
advance since the amount of each Fund's assets to be invested within various
countries is not known.
US Federal Income Taxes. Each Fund is qualified and intends to continue to
qualify for each taxable year for tax treatment as a "regulated investment
company" under the Internal Revenue Code. Qualification relieves a Fund of
Federal income tax liability on that part of its net ordinary income and net
realized capital gains which it pays out to its shareholders. Such qualification
does not, of course, involve governmental supervision of management or
investment practices or policies. Investors should consult their own counsel for
a complete understanding of the requirements a Fund must meet to qualify for
such treatment. The information set forth in the Prospectus and the following
discussion relate solely to the US Federal income taxes on dividends and
distributions by a Fund and assumes that each Fund qualifies as a regulated
investment company. Investors should consult their own counsel for further
details, including their possible entitlement to foreign tax credits that might
be "passed through" to them under the rules described below, and the application
of state and local tax laws to his or her particular situation.
Each Fund intends to declare and distribute dividends in the amounts and at the
times necessary to avoid the application of the 4% Federal excise tax imposed on
certain undistributed income of regulated investment companies. Each Fund will
be required to pay the 4% excise tax to the extent it does not distribute to its
shareholders during any calendar year at least 98% of its ordinary income for
the calendar year plus 98% of its capital gain net income for the twelve months
ended October 31 of such year. Certain distributions of the Fund which are paid
in January of a given year but are declared in the prior October, November or
December to shareholders of record as of a specified date during such a month
will be treated as having been distributed to shareholders and will be taxable
to shareholders as if received in December.
Dividends of net ordinary income and distributions of any net realized
short-term capital gain are taxable to shareholders as ordinary income. Since
each Fund expects to derive a substantial portion of its gross income (exclusive
of capital gains) from sources other than qualifying dividends, it is expected
that only a portion of each Fund's dividends or distributions will qualify for
the dividends received deduction for corporations.
The excess of net long-term capital gains over the net short-term capital losses
realized and distributed by each Fund to its shareholders will be taxable to the
shareholders as long-term capital gains, irrespective of the length of time a
shareholder may have held Fund shares. Individual shareholders will be subject
to federal income tax on net capital gain at a maximum rate of 20% in respect of
shares held for more than one year. Net capital gain of a corporate shareholder
is taxed at the same rate as ordinary income. Any dividend or distribution
received by a shareholder on shares of a Fund shortly after the purchase of such
shares will have the effect of reducing the net asset value of such shares by
the amount of such dividend or distribution. Furthermore, such dividend or
distribution, although in effect a return of capital, would be taxable to the
shareholder as described above. If a shareholder has held shares in a Fund for
six months or less and during that period has received a distribution taxable to
the shareholder as a long-term capital gain, any loss recognized by the
shareholder on the sale of those shares during that period will be treated as a
long-term capital loss to the extent of the distribution.
Dividends and distributions are taxable in the manner discussed regardless of
whether they are paid to the shareholder in cash or are reinvested in additional
shares of a Fund's common stock.
32
<PAGE>
Income received by a Fund from sources within various foreign countries may be
subject to foreign income tax. If more than 50% of the value of a Fund's total
assets at the close of its taxable year consists of the stock or securities of
foreign corporations, such Fund may elect to "pass through" to its shareholders
the amount of foreign income taxes paid by such Fund. Pursuant to such election,
shareholders would be required: (i) to include in gross income, even though not
actually received, their respective pro-rata shares of a Fund's gross income
from foreign sources; and (ii) either to deduct their pro-rata share of foreign
taxes in computing their taxable income, or to use such share as a foreign tax
credit against Federal income tax (but not both). No deduction for foreign taxes
could be claimed by a shareholder who does not itemize deductions.
Shareholders who choose to utilize a credit (rather than a deduction) for
foreign taxes will be subject to the limitation that the credit may not exceed
the shareholder's US tax (determined without regard to the availability of the
credit) attributable to his or her total foreign source taxable income. For this
purpose, the portion of dividends and distributions paid by a Fund from its
foreign source income will be treated as foreign source income. Each Fund's
gains from the sale of securities will generally be treated as derived from US
sources, however, and certain foreign currency gains and losses likewise will be
treated as derived from US sources. The limitation on the foreign tax credit is
applied separately to foreign source "passive income," such as the portion of
dividends received from a Fund, which qualifies as foreign source income. In
addition, the foreign tax credit is allowed to offset only 90% of the
alternative minimum tax imposed on corporations and individuals. Because of
these limitations, shareholders may be unable to claim a credit for the full
amount of their proportionate shares of the foreign income taxes paid by a Fund.
Each Fund intends for each taxable year to meet the requirements of the Code to
"pass through" to its shareholders foreign income taxes paid, but there can be
no assurance that a Fund will be able to do so. Each shareholder will be
notified within 60 days after the close of each taxable year of each Fund
whether the foreign taxes paid by such Fund will "pass through" for that year,
and, if so, the amount of each shareholder's pro-rata share (by country) of (i)
the foreign taxes paid, and (ii) such Fund's gross income from foreign sources.
Of course, shareholders who are not liable for Federal income taxes, such as
retirement plans qualified under Section 401 of the Code, will not be affected
by any such "pass through" of foreign tax credits.
Investments in Passive Foreign Investment Companies. If a Fund purchases shares
in certain foreign investment entities, referred to as "passive foreign
investment companies," the Fund itself may be subject to US Federal income tax,
and an additional charge in the nature of interest, on a portion of any "excess
distribution" from such company or gain from the disposition of such shares,
even if the distribution or gain is paid by such Fund as a dividend to its
shareholders. If a Fund were able and elected to treat a passive foreign
investment company as a "qualified electing fund," in lieu of the treatment
described above, such Fund would be required each year to include in income, and
distribute to shareholders in accordance with the distribution requirements set
forth above, its pro rata share of the ordinary earnings and net capital gains
of the company, whether or not distributed to such Fund.
Certain Foreign Currency Transactions. Gains or losses attributable to foreign
currency contracts, or to fluctuations in exchange rates that occur between the
time a Fund accrues interest or other receivables or accrues expenses or other
liabilities denominated in a foreign currency and the time the Fund actually
collects such receivables or pays such liabilities are treated as ordinary
income or ordinary loss. Similarly, gains or losses on disposition of debt
securities denominated in a foreign currency attributable to fluctuations in the
value of the foreign currency between the date of acquisition of the security
and the date of disposition also are treated as ordinary gain or loss. These
gains or losses increase or decrease the amount of a Fund's net investment
income available to be distributed to its shareholders as ordinary income.
Options Transactions. A special "marked-to-market" system governs the taxation
of "section 1256 contracts," which include certain listed options. Each Fund may
invest in such section 1256 contracts. In general, gain or loss on section 1256
contracts will be taken into account for tax purposes when actually realized. In
addition, any section 1256 contracts held at the end of a taxable year will be
treated as sold at fair market value (that is, marked-to-market), and the
resulting gain or loss will be recognized for tax purposes. In general, gain or
loss recognized by a Fund on the actual or deemed disposition of a section 1256
contract will be treated as 60% long-term and 40% short-term capital gain or
loss, regardless of the period of time the section 1256 contract is actually
held by such Fund. Each Fund can elect to exempt its section 1256 contracts,
which are part of a "mixed" straddle from the application of section 1256.
33
<PAGE>
Shareholders are urged to consult their tax advisors concerning the effect of
federal income taxes in their individual circumstances.
Unless a shareholder includes a certified taxpayer identification number (social
security number for individuals) on the account application and certifies that
the shareholder is not subject to backup withholding, the Funds are required to
withhold and remit to the US Treasury a portion of distributions and other
reportable payments to the shareholder. The rate of backup withholding is 31%.
Shareholders should be aware that, under regulations promulgated by the Internal
Revenue Service, a Fund may be fined $50 annually for each account for which a
certified taxpayer identification number is not provided. In the event that such
a fine is imposed, the Fund may charge a service fee of up to $50 that may be
deducted from the shareholder's account and offset against any undistributed
dividends and capital gain distributions. The Funds also reserve the right to
close any account which does not have a certified taxpayer identification
number.
Underwriters
Distribution of Securities
Seligman Global Fund Series, Inc. and Seligman Advisors are parties to a
Distributing Agreement, dated January 1, 1993, under which Seligman Advisors
acts as the exclusive agent for distribution of shares of the Funds. Seligman
Advisors accepts orders for the purchase of Fund shares, which are offered
continuously. As general distributor of the Fund's capital stock, Seligman
Advisors allows reallowances to all dealers on sales of Class A and Class C
shares, as set forth above under "Dealer Reallowances." Seligman Advisors
retains the balance of sales charges and any CDSC paid by investors.
Total sales charges paid by shareholders of Class A and Class C shares of the
Funds for the fiscal year ended October 31, 1999, and of Class A shares of the
Funds for the fiscal years ended October 31, 1998 and 1997, are shown below, as
well as the amounts of Class A and Class C sales charges that were retained by
Seligman Advisors. No Class C shares of any Fund were issued or outstanding
during the fiscal years ended October 31, 1998 and 1997.
<TABLE>
<CAPTION>
1999
Total Sales Charges Paid by Amount of Class A and Class C
Shareholders on Class A and Sales Charges Retained by
Fund Class C Shares Seligman Advisors
---- -------------- -----------------
<S> <C> <C>
Emerging Markets Fund $ 35,795 $ 3,697
Global Growth Fund 132,518 14,013
Global Smaller Companies Fund 236,132 26,432
Global Technology Fund 861,770 90,188
International Growth Fund 54,552 5,458
<CAPTION>
1998
Total Sales Charges Amount of Class A Sales
Paid by Shareholders Charges Retained by
Fund on Class A Shares Seligman Advisors
---- ----------------- -----------------
<S> <C> <C>
Emerging Markets Fund $ 101,075 $ 11,459
Global Growth Fund 176,957 19,994
Global Smaller Companies Fund 848,066 94,085
Global Technology Fund 1,099,378 121,127
International Growth Fund 117,729 13,622
</TABLE>
34
<PAGE>
<TABLE>
<CAPTION>
1997
Total Sales Charges Amount of Class A Sales
Paid by Shareholders Charges Retained by
Fund on Class A Shares Seligman Advisors
---- ----------------- -----------------
<S> <C> <C>
Emerging Markets Fund $ 622,098 $69,894
Global Growth Fund 403,744 44,965
Global Smaller Companies Fund 3,632,126 400,220
Global Technology Fund 1,923,733 210,590
International Growth Fund 152,666 17,927
</TABLE>
Compensation
Seligman Advisors, which is an affiliated person of Seligman, which is an
affiliated person of the Funds, received the following commissions and other
compensation from the Funds during the fiscal year ended October 31, 1999:
<TABLE>
<CAPTION>
Compensation on
Net Underwriting Redemptions and
Discounts and Repurchases
Commissions (Class (CDSC on Class A,
A and Class C Sales Class C and Class D Brokerage Other
Fund Charges Retained) Shares Retained) Commissions Compensation(1)
- ---- ----------------- ---------------- ----------- ---------------
<S> <C> <C> <C> <C>
Emerging Markets Fund $3,697 $9,177 $-0- $2,495
Global Growth Fund 14,013 11,732 -0- 6,466
Global Smaller Companies Fund 26,432 79,967 -0- 11,862
Global Technology Fund 90,188 58,539 -0- 18,747
International Growth Fund 5,458 11,185 -0- 1,482
</TABLE>
(1) Seligman Advisors has sold its rights to collect the distribution fees paid
by each Fund in respect of Class B shares and any CDSC imposed on
redemptions of Class B shares to FEP Capital, L.P., in connection with an
arrangement with FEP Capital, L.P. as discussed above under "12b-1 Plans."
In connection with this arrangement, Seligman Advisors receives payments
from FEP Capital, L.P. based on the value of Class B shares sold. Such
payments received for fiscal year 1999 are reflected in the table.
Other Payments
Seligman Advisors shall pay broker/dealers, from its own resources, a fee on
purchases of Class A shares of $1,000,000 or more (NAV sales), calculated as
follows: 1.00% of NAV sales up to but not including $2 million; .80% of NAV
sales from $2 million up to but not including $3 million; .50% of NAV sales from
$3 million up to but not including $5 million; and .25% of NAV sales from $5
million and above. The calculation of the fee will be based on assets held by a
"single person," including an individual, members of a family unit comprising
husband, wife and minor children purchasing securities for their own account, or
a trustee or other fiduciary purchasing for a single fiduciary account or single
trust. Purchases made by a trustee or other fiduciary for a fiduciary account
may not be aggregated purchases made on behalf of any other fiduciary or
individual account.
Seligman Advisors shall also pay broker/dealers, from its own resources, a fee
on assets of certain investments in Class A shares of the Seligman mutual funds
participating in an "eligible employee benefit plan" that are attributable to
the particular broker/dealer. The shares eligible for the fee are those on which
an initial sales charge was not paid because either the participating eligible
employee benefit plan has at least (1) $500,000 invested in the Seligman mutual
funds or (2) 50 eligible employees to whom such plan is made available. Class A
shares representing only an initial purchase of Seligman Cash Management Fund
are not eligible for the fee. Such shares will become eligible for the fee once
they are exchanged for shares of another Seligman mutual fund. The payment is
based on cumulative sales for each Plan during a single calendar year, or
portion thereof. The payment schedule, for each calendar year, is as follows:
1.00% of sales up to but not including $2 million; .80% of sales from $2 million
up to but not including $3 million; .50% of sales from $3 million up to but not
including $5 million; and .25% of sales from $5 million and above.
Seligman Advisors may from time to time assist dealers by, among other things,
providing sales literature to, and holding informational programs for the
benefit of, dealers' registered representatives. Dealers may limit the
35
<PAGE>
participation of registered representatives in such informational programs by
means of sales incentive programs which may require the sale of minimum dollar
amounts of shares of Seligman mutual funds. Seligman Advisors may from time to
time pay a bonus or other incentive to dealers that sell shares of the Seligman
mutual funds. In some instances, these bonuses or incentives may be offered only
to certain dealers which employ registered representatives who have sold or may
sell a significant amount of shares of the Fund and/or certain other mutual
funds managed by Seligman during a specified period of time. Such bonus or other
incentive will be made in the form of cash or, if permitted, may take the form
of non-cash payments. The non-cash payments will include (i) business seminars
at Seligman's headquarters or other locations, (ii) travel expenses, including
meals, entertainment and lodging, incurred in connection with trips taken by
qualifying registered representatives and members of their families to places
within or outside the United States, or (iii) the receipt of certain
merchandise. The cash payments may include payment of various business expenses
of the dealer. The cost to Seligman Advisors of such promotional activities and
payments shall be consistent with the rules of the National Association of
Securities Dealers, Inc., as then in effect.
Calculation of Performance Data
Class A
The average annual total returns for the one-year period ended October 31, 1999
and for the period May 28, 1996 (inception) through October 31, 1999 for the
Class A shares of the Emerging Markets Fund were 22.98% and (3.28)%,
respectively. The average annual total returns for the one-year period ended
October 31, 1999 and for the period November 1, 1995 (inception) through October
31, 1999 for the Class A shares of the Global Growth Fund were 27.33% and
15.76%, respectively. The average annual total returns for the one- and
five-year periods ended October 31, 1999 and for the period September 9, 1992
(inception) through October 31, 1999 for the Class A shares of the Global
Smaller Companies Fund were 6.28%, 8.77% and 14.08%, respectively. The average
annual total returns for the one- and five-year periods ended October 31, 1999
and for the period May 23, 1994 (inception) through October 31, 1999 for the
Class A shares of the Global Technology Fund were 80.44%, 28.41% and 29.54%,
respectively. The average annual total returns for the one- and five-year
periods ended October 31, 1999 and for the period April 7, 1992 (inception)
through October 31, 1999 for the Class A shares of the International Growth Fund
were 15.18%, 7.61% and 10.81%, respectively.
The average annual total returns for each Fund's Class A shares were computed by
assuming a hypothetical initial investment of $1,000 in Class A shares of the
Fund, subtracting the maximum sales charge of 4.75% of the public offering
price, and assuming that all of the dividends and capital gain distributions
paid by the Fund's Class A shares, if any, were reinvested over the relevant
time period. It was then assumed that at the end of each period, the entire
amount was redeemed. The average annual total return was then calculated by
calculating the annual rate required for the initial payment to grow to the
amount which would have been received upon such redemption (i.e., the average
annual compound rate of return).
Class B
The average annual total returns for the one-year period ended October 31, 1999
and for the period from May 28, 1996 (inception) to October 31, 1999 for the
Class B shares of the Emerging Markets Fund were 23.10% and (3.48)%,
respectively. The average annual total returns for the one-year period ended
October 31, 1999 and for the period from April 22, 1996 (inception) to October
31, 1999 for the Class B shares of the Global Growth Fund were 27.66% and
14.17%, respectively. The average annual total returns for the one-year period
ended October 31, 1999 and for the period from April 22, 1996 (inception) to
October 31, 1999 for the Class B shares of the Global Smaller Companies Fund
were 5.70% and 2.81%, respectively. The average annual total returns for the
one-year period ended October 31, 1999 and for the period from April 22, 1996
(inception) to October 31, 1999 for the Class B shares of the Global Technology
Fund were 83.10% and 27.39%, respectively. The average annual total returns for
the one-year period ended October 31, 1999 and for the period from April 22,
1996 (inception) to October 31, 1999 for the Class B shares of the International
Growth Fund were 15.08% and 7.70%, respectively.
The average annual total returns for each Fund's Class B shares were computed by
assuming a hypothetical initial investment of $1,000 in Class B shares of the
Fund, and assuming that all of the dividends and capital gain distributions paid
by the Fund's Class B shares, if any, were reinvested over the relevant time
periods. It was
36
<PAGE>
then assumed that at the end of each period, the entire amount was redeemed,
subtracting the applicable CDSC, if applicable.
Class C
The total returns for each Fund's Class C shares for the period from May 27,
1999 (inception) to October 31, 1999 were: 8.32% for International Growth Fund,
4.17% for Emerging Markets Fund, 11.35% for Global Growth Fund, 5.51% for Global
Smaller Companies Fund and 34.72% for Global Technology Fund.
The total returns for each Fund's Class C shares were computed by assuming a
hypothetical initial investment of $1,000 in Class C shares of each Fund,
subtracting the maximum sales charge of 1.00% of the public offering price, and
assuming that all of the dividends and capital gain distributions paid by each
Fund's Class C shares, if any, were reinvested over the period. It was then
assumed that at the end of the period, the entire amount was redeemed,
subtracting the 1% CDSC, if applicable.
Class D
The average annual total returns for the one- and five-year periods ended
October 31, 1999 and for the period from September 21, 1993 (inception) through
October 31, 1999 for the Class D shares of the International Growth Fund were
18.97%, 7.75%, and 9.13%, respectively. The average annual total returns for the
one-year period ended October 31, 1999 and for the period from May 28, 1996
(inception) through October 31, 1999 for the Class D shares of the Emerging
Markets Fund were 27.10% and (2.62)%, respectively. The average annual total
returns for the one-year period ended October 31, 1999 and the period from
November 1, 1995 (inception) through October 31, 1999 for the Class D shares of
the Global Growth Fund were 31.66% and 16.32%, respectively. The average annual
total returns for the one- and five-year periods ended October 31, 1999 and for
the period from May 3, 1993 (inception) through October 31, 1999 for Class D
shares of the Global Smaller Companies Fund were 9.69%, 8.99% and 12.45%,
respectively. The average annual total returns for the one- and five-year
periods ended October 31, 1999 and for the period from May 23, 1994 (inception)
through October 31, 1999 for the Class D shares of the Global Technology Fund
were 87.17%, 28.63% and 29.67%, respectively.
The average annual total returns for each Fund's Class D shares were computed by
assuming a hypothetical initial investment of $1,000 in Class D shares of the
Fund, and assuming that all dividends and distributions paid by the Fund's Class
D shares, if any, were reinvested over the relevant time period. It was then
assumed that at the end of each period, the entire amount was redeemed,
subtracting the 1% CDSC, if applicable.
The tables below illustrate the total returns on a $1,000 investment in each of
the Fund's Class A, Class B, Class C and Class D shares from the commencement of
a Fund's operations through October 31, 1999, assuming investment of all
dividends and capital gain distributions and deduction of any applicable sales
charges or CDSCs. Average annual total returns are determined by calculating the
annual rate of return required for the initial $1,000 investment to grow to the
amount that would have been received upon redemption. (i.e., the average annual
compound rate of return). The results shown should not be considered a
representation of the dividend income or gain or loss in capital value which may
be realized from an investment made in a Class of shares of any Fund today.
<TABLE>
<CAPTION>
Class A
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund
10/31/96 $ 904 $-0- $-0- $ 904
10/31/97 979 -0- -0- 979
10/31/98 691 -0- -0- 691
10/31/99 892 -0- -0- 892 (10.80)%
</TABLE>
37
<PAGE>
<TABLE>
<CAPTION>
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Global Growth Fund
10/31/96 $1,077 $-0- $-0- $1,077
10/31/97 1,227 -0- -0- 1,227
10/31/98 1,282 61 -0- 1,343
10/31/99 1,715 81 -0- 1,796 79.60%
Global Smaller Companies
Fund
10/31/92 $953 $-0- $-0- $953
10/31/93 1,330 -0- 3 1,333
10/31/94 1,591 10 3 1,604
10/31/95 1,853 69 4 1,926
10/31/96 2,019 230 4 2,253
10/31/97 2,083 352 4 2,439
10/31/98 1,881 412 4 2,297
10/31/99 2,099 460 4 2,563 156.26%
Global Technology Fund
10/31/94 $1,116 $-0- $-0- $1,116
10/31/95 1,740 16 -0- 1,756
10/31/96 1,508 116 3 1,627
10/31/97 2,019 156 3 2,178
10/31/98 1,664 494 3 2,161
10/31/99 3,115 972 5 4,092 309.22%
International Growth Fund
10/31/92 $944 $-0- $-0- $944
10/31/93 1,268 -0- 4 1,272
10/31/94 1,402 28 5 1,435
10/31/95 1,326 87 5 1,418
10/31/96 1,363 169 5 1,537
10/31/97 1,422 261 5 1,688
10/31/98 1,409 384 5 1,798
10/31/99 1,704 465 6 2,175 117.47%
<CAPTION>
Class B
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund
10/31/96 $947 $-0- $-0- $947
10/31/97 1,018 -0- -0- 1,018
10/31/98 713 -0- -0- 713
10/31/99 886 -0- -0- 886 (11.42)%
</TABLE>
38
<PAGE>
<TABLE>
<CAPTION>
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Global Growth Fund
10/31/96 $998 $-0- $-0- $998
10/31/97 1,127 -0- -0- 1,127
10/31/98 1,169 56 -0- 1,225
10/31/99 1,521 75 -0- 1,596 59.58%
Global Smaller Companies
Fund
10/31/96 $1,019 $-0- $-0- $1,019
10/31/97 1,042 -0- 53 1,095
10/31/98 932 43 48 1,023
10/31/99 1,002 48 53 1,103 10.27%
Global Technology Fund
10/31/96 $967 $-0- $-0- $967
10/31/97 1,284 -0- -0- 1,284
10/31/98 1,044 220 -0- 1,264
10/31/99 1,911 437 -0- 2,348 134.82%
International Growth Fund
10/31/96 $963 $-0- $-0- $963
10/31/97 995 54 -0- 1,049
10/31/98 974 133 -0- 1,107
10/31/99 1,140 159 -0- 1,299 29.90%
<CAPTION>
Class C
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund
10/31/99 $1,042 $-0- $-0- $1,042 4.17%
Global Growth
Fund
10/31/99 $1,113 $-0- $-0- $1,113 11.35%
Global Smaller Companies
Fund
10/31/99 $1,055 $-0- $-0- $1,055 5.51%
Global Technology Fund
10/31/99 $1,347 $-0- $-0- $1,347 34.72%
International Growth Fund
10/31/99 $1,083 $-0- $-0- $1,083 8.32%
</TABLE>
39
<PAGE>
<TABLE>
<CAPTION>
Class D
Fund/ Value of Value of Value Total Value
Period Initial Capital Gain of of Total
Ended (1) Investment (2) Distributions Dividends Investment (2) Return (1)(3)
--------- -------------- ------------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund
10/31/96 $947 $-0- $-0- $947
10/31/97 1,018 -0- -0- 1,018
10/31/98 713 -0- -0- 713
10/31/99 913 -0- -0- 913 (8.68)%
Global Growth
Fund
10/31/96 $1,123 $-0- $-0- $1,123
10/31/97 1,269 -0- -0- 1,269
10/31/98 1,317 63 -0- 1,380
10/31/99 1,747 84 -0- 1,831 83.07%
Global Smaller Companies
Fund
10/31/93 $1,167 $-0- $-0- $1,167
10/31/94 1,385 9 -0- 1,394
10/31/95 1,600 60 -0- 1,660
10/31/96 1,728 200 -0- 1,928
10/31/97 1,767 305 -0- 2,072
10/31/98 1,581 355 -0- 1,936
10/31/99 1,750 393 -0- 2,143 114.32%
Global Technology Fund
10/31/94 $1,168 $-0- $-0- $1,168
10/31/95 1,806 16 -0- 1,822
10/31/96 1,554 121 -0- 1,675
10/31/97 2,063 161 -0- 2,224
10/31/98 1,675 511 -0- 2,186
10/31/99 3,113 1,001 -0- 4,114 311.39%
International Growth Fund
10/31/93 $1,048 $-0- $-0- $1,048
10/31/94 1,151 23 -0- 1,174
10/31/95 1,079 71 -0- 1,150
10/31/96 1,099 138 -0- 1,237
10/31/97 1,136 211 -0- 1,347
10/31/98 1,112 310 -0- 1,422
10/31/99 1,333 372 -0- 1,705 70.55%
</TABLE>
- ----------
(1) From commencement of operations on:
<TABLE>
<CAPTION>
Fund Class A Shares Class B Shares Class C Shares Class D Shares
---- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Emerging Markets Fund 5/28/96 5/28/96 5/27/99 5/28/96
Global Growth Fund 11/1/95 4/22/96 5/27/99 11/1/95
Global Smaller Companies Fund 9/9/92 4/22/96 5/27/99 5/3/93
Global Technology Fund 5/23/94 4/22/96 5/27/99 5/23/94
International Growth Fund 4/7/92 4/22/96 5/27/99 9/21/93
</TABLE>
(2) The "Value of Initial Investment" as of the date indicated reflects the
effect of the maximum sales charge or CDSC, if applicable, assumes that all
dividends and capital gain distributions were taken in cash and reflects
changes in the net asset value of the shares purchased with the
hypothetical initial investment. "Total Value of Investment" reflects the
effect of the CDSC, if applicable, and assumes investment of all dividends
and capital gain distributions.
40
<PAGE>
(3) "Total Return" for each Class of shares of a Fund is calculated by assuming
a hypothetical initial investment of $1,000 at the beginning of the period
specified; subtracting the maximum sales charge for Class A and Class C
shares; determining total value of all dividends and capital gain
distributions that would have been paid during the period on such shares
assuming that each dividend or capital gain distribution was invested in
additional shares at net asset value; calculating the total value of the
investment at the end of the period; subtracting the CDSC on Class B, Class
C and Class D shares, if applicable; and finally, by dividing the
difference between the amount of the hypothetical initial investment at the
beginning of the period and its total value at the end of the period by the
amount of the hypothetical initial investment. The International Growth
Fund's total return and average annual total return quoted from time to
time through September 21, 1993 for Class A shares does not reflect the
deduction of the administration, shareholder services and distribution fees
effective on that date, which fees, if reflected would reduce the
performance quoted.
No adjustments have been made for any income taxes payable by investors on
dividends invested or gain distributions taken in shares.
Seligman and/or the prior subadviser waived its fees and reimbursed certain
expenses during some of the periods above, which positively affected the
performance results presented.
From time to time, reference may be made in advertising or promotional material
to performance information, including mutual fund rankings, prepared by Lipper
Analytical Services, Inc., an independent reporting service which monitors the
performance of mutual funds. In calculating the total return of the Fund's Class
A, Class B, Class C, and Class D shares, the Lipper analysis assumes investment
of all dividends and distributions paid but does not take into account
applicable sales charges. Each Fund may also refer in advertisements in other
promotional material to articles, comments, listings and columns in the
financial press pertaining to the Fund's performance. Examples of such financial
and other press publications include BARRON'S, BUSINESS WEEK, CDA/WIESENBERGER
MUTUAL FUNDS INVESTMENT REPORT, CHRISTIAN SCIENCE MONITOR, FINANCIAL PLANNING,
FINANCIAL TIMES, FINANCIAL WORLD, FORBES, FORTUNE, INDIVIDUAL INVESTOR,
INVESTMENT ADVISOR, INVESTORS BUSINESS DAILY, KIPLINGER'S, LOS ANGELES TIMES,
MONEY MAGAZINE, MORNINGSTAR, INC., PENSION AND INVESTMENTS, SMART MONEY, THE NEW
YORK TIMES, THE WALL STREET JOURNAL, USA TODAY, U.S. NEWS AND WORLD REPORT,
WORTH MAGAZINE, WASHINGTON POST AND YOUR MONEY.
A Fund's advertising or promotional material may make reference to the Fund's
"Beta," "Standard Deviation," or "Alpha." Beta measures the volatility of the
Fund, as compared to that of the overall market. Standard deviation measures how
widely the Fund's performance has varied from its average performance, and is an
indicator of the Fund's potential for volatility. Alpha measures the difference
between the returns of the Fund and the returns of the market, adjusted for
volatility.
Financial Statements
The Annual Report to shareholders for the fiscal year ended October 31, 1999
contains a schedule of the investments of each of the Funds as of October 31,
1999, as well as certain other financial information as of that date. The
financial statements and notes included in the Annual Report, and the
Independent Auditors' Report thereon, are incorporated herein by reference. The
Annual Report will be furnished without charge to investors who request copies
of this SAI.
General Information
Rule 18f-2 under the 1940 Act provides that any matter required to be submitted
by the provisions of the 1940 Act or applicable state law, or otherwise, to the
holders of the outstanding voting securities of an investment company such as
the Fund shall not be deemed to have been effectively acted upon unless approved
by the holders of a majority of the outstanding shares of each class or Fund
affected by such matter. Rule 18f-2 further provides that a class or Fund shall
be deemed to be affected by a matter unless it is clear that the interests of
each class or Fund in the matter are substantially identical or that the matter
does not affect any interest of such class or Fund. However, the Rule exempts
the selection of independent public accountants, the approval of principal
distributing contracts and the election of directors from the separate voting
requirements of the Rule.
Custodian and Recordkeeping Agents. Chase Manhattan Bank, One Pierrepont Plaza,
Brooklyn, New York 11201, serves as custodian for the Fund. State Street Bank &
Trust Company, 801 Pennsylvania, Kansas City, Missouri 64105, maintains, under
the general supervision of Seligman, certain accounting records and determines
the net asset value for the each Fund.
41
<PAGE>
Auditors. Deloitte & Touche LLP, independent auditors, have been selected as
auditors of the Funds. Their address is Two World Financial Center, New York, NY
10281.
42
<PAGE>
Appendix A
Moody's Investors Service (Moody's)
Debt Securities
Aaa: Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk. Interest payments are protected by a
large or by an exceptionally stable margin and principal is secure. While the
various protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong position of such
issues.
Aa: Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high-grade
bonds. They are rated lower than Aaa bonds because margins of protection may not
be as large or fluctuation of protective elements may be of greater amplitude or
there may be other elements present which make the long-term risks appear
somewhat larger than in Aaa securities.
A: Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.
Baa: Bonds which are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be characteristically lacking or may be unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact may have speculative characteristics as well.
Ba: Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate, and thereby not well safeguarded
during other good and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B: Bonds which are rated B generally lack characteristics of a desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
Caa: Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.
Ca: Bonds which are rated Ca represent obligations which are speculative in high
degree. Such issues are often in default or have other marked shortcomings.
C: Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.
Moody's applies numerical modifiers (1, 2 and 3) in each generic rating
classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; modifier 2 indicates a mid-range ranking; and modifier 3
indicates that the issuer ranks in the lower end of its generic rating category.
43
<PAGE>
Commercial Paper
Moody's Commercial Paper Ratings are opinions of the ability of issuers to repay
punctually promissory senior debt obligations not having an original maturity in
excess of one year. Issuers rated "Prime-1" or "P-1" indicate the highest
quality repayment ability of the rated issue.
The designation "Prime-2" or "P-2" indicates that the issuer has a strong
ability for repayment of senior short-term promissory obligations. Earnings
trends and coverage ratios, while sound, may be more subject to variation.
Capitalization characteristics, while still appropriate, may be more affected by
external conditions. Ample alternative liquidity is maintained.
The designation "Prime-3" or "P-3" indicates that the issuer has an acceptable
capacity for repayment of short-term promissory obligations. The effect of
industry characteristics and market compositions may be more pronounced.
Variability in earnings and profitability may result in changes in the level of
debt protection measurements and may require relatively high financial leverage.
Adequate alternate liquidity is maintained.
Issues rated "Not Prime" do not fall within any of the Prime rating categories.
Standard & Poor's Ratings Services (S&P)
Debt Securities
AAA: Debt issues rated AAA are highest grade obligations. Capacity to pay
interest and repay principal is extremely strong.
AA: Debt issues rated AA have a very high degree of safety and very strong
capacity to pay interest and repay principal and differ from the highest rated
issues only in small degree.
A: Debt issues rated A are regarded as upper medium grade. They have a strong
degree of safety and capacity to pay interest and repay principal although it is
somewhat more susceptible in the long-term to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.
BBB: Debt issues rated BBB are regarded as having a satisfactory degree of
safety and capacity to pay interest and re-pay principal. Whereas they normally
exhibit adequate protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay interest and
re-pay principal for bonds in this category than for bonds in higher rated
categories.
BB, B, CCC, CC: Debt issues rated BB, B, CCC and CC are regarded on balance, as
predominantly speculative with respect to capacity to pay interest and pre-pay
principal in accordance with the terms of the bond. BB indicates the lowest
degree of speculation and CC the highest degree of speculation. While such bonds
will likely have some quality and protective characteristics, these are
outweighed by large uncertainties or major risk exposure to adverse conditions.
C: The rating C is reserved for income bonds on which no interest is being paid.
D: Debt issues rated D are in default, and payment of interest and/or repayment
of principal is in arrears.
NR: Indicates that no rating has been requested, that there is insufficient
information on which to base a rating or that S&P does not rate a particular
type of bond as a matter of policy.
44
<PAGE>
Commercial Paper
S&P Commercial Paper ratings are current assessments of the likelihood of timely
payment of debts having an original maturity of no more than 365 days.
A-1: The A-1 designation indicates that the degree of safety regarding timely
payment is very strong.
A-2: Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1."
A-3: Issues carrying this designation have adequate capacity for timely payment.
They are, however, more vulnerable to the adverse effects of changes in
circumstances than obligations carrying the higher designations.
B: Issues rated "B" are regarded as having only a speculative capacity for
timely payment.
C: This rating is assigned to short-term debt obligations with a doubtful
capacity of payment.
D: Debt rated "D" is in payment default.
NR: Indicates that no rating has been requested, that there is insufficient
information on which to base a rating or that S&P does not rate a particular
type of bond as a matter of policy.
The ratings assigned by S&P may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within its major rating categories.
45
<PAGE>
Appendix B
HISTORY OF J. & W. SELIGMAN & CO. INCORPORATED
Seligman's beginnings date back to 1837, when Joseph Seligman, the oldest of
eight brothers, arrived in the United States from Germany. He earned his living
as a pack peddler in Pennsylvania, and began sending for his brothers. The
Seligmans became successful merchants, establishing businesses in the South and
East.
Backed by nearly thirty years of business success - culminating in the sale of
government securities to help finance the Civil War - Joseph Seligman, with his
brothers, established the international banking and investment firm of J. & W.
Seligman & Co. In the years that followed, the Seligman Complex played a major
role in the geographical expansion and industrial development of the United
States.
The Seligman Complex:
...Prior to 1900
o Helps finance America's fledgling railroads through underwritings.
o Is admitted to the New York Stock Exchange in 1869. Seligman remained a
member of the NYSE until 1993, when the evolution of its business made it
unnecessary.
o Becomes a prominent underwriter of corporate securities, including New York
Mutual Gas Light Company, later part of Consolidated Edison.
o Provides financial assistance to Mary Todd Lincoln and urges the Senate to
award her a pension.
o Is appointed U.S. Navy fiscal agent by President Grant.
o Becomes a leader in raising capital for America's industrial and urban
development.
...1900-1910
o Helps Congress finance the building of the Panama Canal.
...1910s
o Participates in raising billions for Great Britain, France and Italy,
helping to finance World War I.
...1920s
o Participates in hundreds of successful underwritings including those for
some of the Country's largest companies: Briggs Manufacturing, Dodge
Brothers, General Motors, Minneapolis-Honeywell Regulatory Company, Maytag
Company United Artists Theater Circuit and Victor Talking Machine Company.
o Forms Tri-Continental Corporation in 1929, today the nation's largest,
diversified closed-end equity investment company, with over $3 billion in
assets, and one of its oldest.
...1930s
o Assumes management of Broad Street Investing Co. Inc., its first mutual
fund, today known as Seligman Common Stock Fund, Inc.
o Establishes Investment Advisory Service.
...1940s
o Helps shape the Investment Company Act of 1940.
o Leads in the purchase and subsequent sale to the public of Newport News
Shipbuilding and Dry Dock Company, a prototype transaction for the
investment banking industry.
o Assumes management of National Investors Corporation, today Seligman Growth
Fund, Inc.
o Establishes Whitehall Fund, Inc., today Seligman Income Fund, Inc.
46
<PAGE>
...1950-1989
o Develops new open-end investment companies. Today, manages more than 50
mutual fund portfolios.
o Helps pioneer state-specific, municipal bond funds, today managing a
national and 18 state-specific municipal funds.
o Establishes J. & W. Seligman Trust Company and J. & W. Seligman Valuations
Corporation.
o Establishes Seligman Portfolios, Inc., an investment vehicle offered
through variable annuity products.
...1990s
o Introduces Seligman Select Municipal Fund, Inc. and Seligman Quality
Municipal Fund, Inc., two closed-end funds that invest in high quality
municipal bonds.
o In 1991 establishes a joint venture with Henderson plc, of London, known as
Seligman Henderson Co., to offer global and international investment
products.
o Introduces to the public Seligman Frontier Fund, Inc., a small
capitalization mutual fund.
o Launches Seligman Global Fund Series, Inc., which today offers five
separate Funds: Seligman International Growth Fund, Seligman Global Smaller
Companies Fund, Seligman Global Technology Fund Seligman Global Growth Fund
and Seligman Emerging Markets Fund.
o Launches Seligman Value Fund, Inc., which currently offers two separate
Fund: Seligman Large-Cap Value Fund and Seligman Small-Cap Value Fund.
o Launches innovative Seligman New Technologies Fund, Inc., a closed-end
"interval" fund seeking long-term capital appreciation by investing in
technology companies, including venture capital investing.
...2000
o Introduces Seligman Time Horizon/Harvester Series, Inc., an asset
allocation type mutual fund containing four funds: Seligman Time Horizon 30
Fund, Seligman Time Horizon 20 Fund, Seligman Time Horizon 10 Fund and
Seligman Harvester Fund.
47
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION
Item 23. Exhibits.
All Exhibits have been previously filed and are incorporated by reference
herein, except Exhibits marked with an asterisk (*), which are filed herewith.
(a) Articles Supplementary dated May 24, 1999. (Incorporated by reference
to Registrant's Post-Effective Amendment No. 28 filed on May 28,
1999.)
(a)(1) Articles of Amendment and Restatement of Articles of Incorporation of
Registrant. (Incorporated by reference to Registrant's Post-Effective
Amendment No. 27 filed on March 1, 1999.)
(b) Amended and Restated By-Laws. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 23, filed on February 27,
1997.)
(c) Specimen Stock Certificates for Class A and Class D Shares with
respect to Seligman International Growth Fund (formerly, Seligman
Henderson International Fund). (Incorporated by reference to Exhibit 4
of Registrant's Post-Effective Amendment No. 6 filed on April 23, 1993
and Registrant's Post-Effective Amendment No. 8 filed on September 21,
1993.) Specimen Stock Certificate for Class B Shares with respect to
Seligman International Growth Fund. (Incorporated by reference to
Registrant's Form SE filed on April 16, 1996.)
(c)(1) Specimen Stock Certificates for Class A and Class D Shares with
respect to Seligman Global Smaller Companies Fund (formerly, Seligman
Henderson Global Smaller Companies Fund, and also formerly, Seligman
Henderson Global Emerging Companies Fund). (Incorporated by reference
to Exhibit 4a to Registrant's Post-Effective Amendment No. 10 filed on
August 10, 1992.) Specimen Stock Certificate for Class B Shares with
respect to Seligman Global Smaller Companies Fund. (Incorporated by
reference to Registrant's Form SE filed on April 16, 1996.)
(c)(2) Specimen Stock Certificates for Class A and Class D Shares with
respect to Seligman Global Technology Fund (formerly, Seligman
Henderson Global Technology Fund). (Incorporated by reference to
Exhibit 4b of Registrant's Post-Effective Amendment No. 11, filed on
May 10, 1994.) Specimen Stock Certificate for Class B Shares with
respect to Seligman Global Technology Fund. (Incorporated by reference
to Registrant's Form SE filed on April 16, 1996.)
(c)(3) Specimen Stock Certificates for Class A and Class D Shares with
respect to Seligman Global Growth Fund (formerly, Seligman Henderson
Global Growth Opportunities Fund). (Incorporated by reference to
Registrant's Form SE filed on October 30, 1995.) Specimen Stock
Certificate for Class B Shares with respect to Seligman Global Growth
Fund. (Incorporated by reference to Registrant's Form SE filed on
April 16, 1996.)
(c)(4) Specimen Stock Certificates for Class A, Class B and Class D Shares
with respect to Seligman Emerging Markets Fund (formerly, Seligman
Henderson Emerging Markets Growth Fund). (Incorporated by reference to
Registrant's Form SE, filed on May 15, 1996.)
(c)(5) Additional rights of security holders are set forth in Article FIFTH
and SEVENTH of the Registrant's Articles of Incorporation and Articles
I and IV of Registrant's By-Laws. (Incorporated by reference to
Exhibits 1 and 2, respectively, to Registrant's Post-Effective
Amendment No. 23, filed on February 27, 1997.)
(d) Revised Management Agreement between the Registrant and J. & W.
Seligman & Co. Incorporated. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 21, filed on May 20, 1996.)
C-1
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
(d)(1) Subadvisory Agreement between J. & W. Seligman & Co. Incorporated and
Henderson Investment Management Limited. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 25 filed on February 26,
1998.)
(e) Addendum to Sales/Bank Agreement. (Incorporated by reference to
Post-Effective Amendment No. 57 to the Registration Statement of
Seligman Capital Fund, Inc. (File No. 811-1886) filed on May 28,
1999.)
(e)(1) Form of Bank Agreement between Seligman Advisors, Inc. and Banks.
(Incorporated by reference to Post-Effective Amendment No. 57 to the
Registration Statement of Seligman Capital Fund, Inc. (File No.
811-1886) filed on May 28, 1999.)
(e)(2) Distributing Agreement between the Registrant and Seligman Advisors,
Inc. (Incorporated by reference to Exhibit 6 of Registrant's
Post-Effective Amendment No. 17, filed on October 27, 1995.)
(e)(3) Sales Agreement between Seligman Advisors, Inc. and Dealers.
(Incorporated by reference to Registrant's Post-Effective Amendment
No. 20, filed on April 19, 1996.)
(e)(4) Form of Sales Agreement between Seligman Advisors, Inc. and Morgan
Stanely Dean Witter & Co (formerly, Dean Witter Reynolds, Inc.).
(Incorporated by reference to Exhibit 6b of the Post-Effective
Amendment No. 53 to the Registration Statement of Seligman Capital
Fund, Inc. (File No. 2-33566) filed on April 28, 1997.)
(e)(5) Form of Sales Agreement between Seligman Advisors, Inc. and Morgan
Stanley Dean Witter & Co (formerly Dean Witter Reynolds, Inc.) with
respect to certain Chilean institutional investors. (Incorporated by
reference to Exhibit 6c of Post-Effective Amendment No. 53 to the
Registration Statement of Seligman Capital Fund, Inc. (File No.
2-33566), filed on April 28, 1997.)
(e)(6) Form of Dealer Agreement between Seligman Advisors, Inc. and Salomon
Smith Barney Inc (formerly, Smith Barney Inc). (Incorporated by
reference to Exhibit 6d of the Post-Effective Amendment No. 53 to the
Registration Statement of Seligman Capital Fund, Inc. (File No.
2-33566) filed on April 28, 1997.)
(f) Matched Accumulation Plan of J. & W. Seligman & Co. Incorporated.
(Incorporated by reference to Exhibit 7 of the Post-Effective
Amendment No. 21 to the Registration Statement of Seligman Frontier
Fund, Inc. (File No. 2-92487) filed on January 29, 1997.)
(f)(1) Amended Deferred Compensation Plan for Directors. (Incorporated by
reference to Registrant's Post-Effective Amendment No. 27 filed on
March 1, 1999.)
(f)(2) Deferred Compensation Plan for Directors. (Incorporated by reference
to the Post-Effective Amendment No. 21 to the Registration Statement
of Seligman Frontier Fund, Inc. (File No. 2-92487) filed on January
29, 1997.)
(g) Custody Agreement, dated May 1, 1996, between Registrant and Chase
Manhattan Bank. (Incorporated by reference to Exhibit 8 of
Registrant's Post-Effective Amendment No. 22 filed on November 20,
1996.)
(h) Recordkeeping Agreement between Registrant and Investors Fiduciary
Trust Company. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 23, filed on February 27, 1997.)
(i) Opinion and Consent of Counsel on behalf of each of the Fund's Class C
shares. Incorporated by reference to Registrant's Post-Effective
Amendment No. 28 filed on May 28, 1999.)
C-2
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
(i)(2) Opinion and Consent of Counsel on behalf of Registrant's Seligman
International Growth Fund. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 23, filed on February 27, 1997.)
(i)(3) Opinon and Consent of Counsel on behalf of Registrant's Seligman
Emerging Markets Fund. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 21 filed on May 20, 1996.)
(i)(4) Opinion and Consent of Counsel on behalf of Registrant's Seligman
Global Growth Fund. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 17 filed on October 27, 1995.)
(i)(5) Opinion and Consent of Counsel on behalf of Registrant's Seligman
Global Technology Fund. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 27 filed March 1, 1999.)
(j) *Consent of Independent Auditors.
(k) Not applicable.
(l) Form of Purchase Agreement for Initial Capital between Registrant's
Class C shares and J. & W. Seligman & Co. Incorporated. (Incorporated
by reference to Registrant's Post-Effective Amendment No. 28 filed on
May 28, 1999.)
(l)(1) Form of Purchase Agreement for Initial Capital between Registrant's
Seligman International Growth Fund's Class A and Class D Shares and J.
& W. Seligman & Co. Incorporated. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 23 filed on February 27,
1997.) Form of Purchase Agreement for Initial Capital between
Registrant's Seligman International Growth Fund's Class B shares and
J. & W. Seligman & Co. Incorporated. (Incorporated by reference to
Exhibit 13a of Registrant's Post-Effective Amendment No. 20 filed on
April 19, 1996.)
(l)(2) Form of Purchase Agreement for Initial Capital between Registrant's
Seligman Global Smaller Companies Fund's Class D Shares and J. & W.
Seligman & Co. Incorporated. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 23 filed on February 27,
1997.) Form of Purchase Agreement for Initial Capital between
Registrant's Seligman Global Smaller Companies Fund's Class B shares
and J. & W. Seligman & Co. Incorporated. (Incorporated by reference to
Exhibit 13b of Registrant's Post-Effective Amendment No. 20 filed on
April 19, 1996.)
(l)(3) Form of Purchase Agreement for Initial Capital between Registrant's
Seligman Global Technology Fund's Class A and Class D Shares and J. &
W. Seligman & Co. Incorporated. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 23, filed on February 27,
1997.) Form of Purchase Agreement for Initial Capital between
Registrant's Seligman Global Technology Fund's Class B shares and J. &
W. Seligman & Co. Incorporated. (Incorporated by reference to Exhibit
13c of Registrant's Post-Effective Amendment No. 20, filed on April
19, 1996.)
(l)(4) Form of Purchase Agreement for Initial Capital between Registrant's
Seligman Global Growth Fund's Class B shares and J. & W. Seligman &
Co. Incorporated. (Incorporated by reference to Exhibit 13d of
Registrant's Post-Effective Amendment No. 20 filed April 19, 1996.)
C-3
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
(l)(5) Copy of Purchase Agreement for Initial Capital between Registrant's
Seligman Emerging Markets Fund's Class A, Class B and Class D Shares
and J. & W. Seligman & Co. Incorporated. (Incorporated by reference to
Registrant's Post-Effective Amendment No. 21, filed on May 20, 1996.)
(m) Form of Amended Administration, Shareholder Services and Distribution
Plans for each of Seligman International Growth Fund, Seligman Global
Smaller Companies Fund, Seligman Global Technology Fund, Seligman
Global Growth Fund and Seligman Emerging Markets Fund (the Funds), and
Form of Amended Administration, Shareholder Services and Distribution
Agreements for each of the Funds. (Incorporated by reference to
Post-Effective Amendment No. 57 to the Registration Statement of
Seligman Capital Fund, Inc. (File No. 811-1886) filed on May 28,
1999.)
(n) Plan of Multiple Classes of Shares (four Classes) pursuant to Rule
18f-3 under the Investment Company Act of 1940. (Incorporated by
reference to Post-Effective Amendment No. 57 to the Registration
Statement of Seligman Capital Fund, Inc. (File No. 811-1886) filed on
May 28, 1999.)
(p) *Code of Ethics.
(Other Exhibits) Powers of Attorney. (Incorporated by reference to Registrant's
Post-Effective Amendment No. 25 filed on February 26, 1998.)
Item 24. Persons Controlled by or Under Common Control with Registrant. None.
Item 25. Indemnification. Reference is made to the provisions of Articles
TWELFTH and THIRTEENTH of Registrant's Amended and Restated Articles
of Incorporation filed as Exhibit 24(b)(1) and Article VII of
Registrant's Amended and Restated By-Laws filed as Exhibit 24(b)(2) to
Registrant's Post-Effective Amendment No. 23 to its Registration
Statement.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to directors,
officers and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been advised by
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 expenses
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.
Item 26. Business and Other Connections of Investment Adviser. J. & W. Seligman
& Co. Incorporated (Seligman) also serves as investment manager to
nineteen other associated investment companies. They are Seligman
Capital Fund, Inc., Seligman Cash Management Fund, Inc., Seligman
Common Stock Fund, Inc., Seligman Communications and Information Fund,
Inc., Seligman Frontier Fund, Inc., Seligman Growth Fund, Inc.,
Seligman High Income Fund Series, Seligman Income Fund, Inc., Seligman
Municipal Fund Series, Inc., Seligman Municipal Series Trust, Seligman
New Jersey Municipal Fund, Inc., Seligman New Technologies Fund, Inc.,
Seligman Pennsylvania Municipal Fund Series, Seligman Portfolios,
Inc., Seligman Quality Municipal Fund, Inc., Seligman Select Municipal
Fund, Inc., Seligman Time Horizon/Harvester Series, Inc., Seligman
Value Fund Series, Inc. and Tri-Continental Corporation.
C-4
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
Henderson Investment Management Limited (HIML), serves as subadviser
to Registrant's Seligman Global Smaller Companies Fund and to the
Global Smaller Companies Portfolio of Seligman Portfolios, Inc. HIML
served as a subadviser to each of the Registrant's other Funds and to
the Seligman Global Portfolios of Seligman Portfolios, Inc. from July
1, 1998 to March 31, 2000.
Seligman and HIML each have an investment advisory service division,
which provides investment management or advice to private clients. The
list required by this Item 26 of officers and directors of Seligman
and HIML, respectively, together with information as to any other
business, profession, vocation or employment of a substantial nature
engaged in by such officers and directors during the past two years,
is incorporated by reference to Schedules A and D of Form ADV, filed
by the investment manager and the subadviser, respectively, pursuant
to the Investment Advisers Act of 1940, as amended (SEC File Nos.
801-15798 and 801-55577) filed on March 31, 1999.
Item 27. Principal Underwriters.
(a) The names of each investment company (other than the Registrant)
for which Registrant's principal underwriter currently distributing
securities of the Registrant also acts as a principal underwriter,
depositor or investment adviser follow:
Seligman Capital Fund, Inc.
Seligman Cash Management Fund, Inc.
Seligman Common Stock Fund, Inc.,
Seligman Communications and Information Fund, Inc.
Seligman Frontier Fund, Inc.
Seligman Growth Fund, Inc.
Seligman High Income Fund Series, Inc.
Seligman Income Fund, Inc.
Seligman Municipal Fund Series, Inc.
Seligman Municipal Series Trust, Inc.
Seligman New Jersey Municipal Fund, Inc.
Seligman Pennsylvania Municipal Fund Series, Inc.
Seligman Portfolios, Inc.
Seligman Time Horizon/Harvester Series, Inc.
Seligman Value Fund Series, Inc.
(b) Name of each director, officer or partner of Registrant's
principal underwriter named in response to Item 20:
<TABLE>
<CAPTION>
Seligman Advisors, Inc.
As of January 31, 2000
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
William C. Morris* Director Chairman of the Board
and Chief Executive
Officer
Brian T. Zino* Director President and Director
Ronald T. Schroeder* Director None
</TABLE>
C-5
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
<TABLE>
<CAPTION>
Seligman Advisors, Inc.
As of January 31, 2000
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
Fred E. Brown* Director Director Emeritus
William H. Hazen* Director None
Thomas G. Moles* Director None
David F. Stein* Director None
Stephen J. Hodgdon* President and Director None
Charles W. Kadlec* Chief Investment Strategist None
Lawrence P. Vogel* Senior Vice President, Finance Vice President
Edward F. Lynch* Senior Vice President, National None
Sales Director
James R. Besher Senior Vice President, Division None
14000 Margaux Lane Sales Director
Town & Country, MO 63017
Gerald I. Cetrulo, III Senior Vice President, Sales None
140 West Parkway
Pompton Plains, NJ 07444
Matthew A. Digan* Senior Vice President, Domestic None
Funds
Jonathan G. Evans Senior Vice President, Sales None
222 Fairmont Way
Ft. Lauderdale, FL 33326
T. Wayne Knowles Senior Vice President, Division None
104 Morninghills Court Sales Director
Cary, NC 27511
Joseph Lam Senior Vice President, Regional None
Seligman International Inc. Director, Asia
Suite 1133, Central Building
One Pedder Street
Central Hong Kong
Bradley W. Larson Senior Vice President, Sales None
367 Bryan Drive
Alamo, CA 94526
Michelle L. McCann-Rappa* Senior Vice President, Retirement None
Plans
Scott H. Novak* Senior Vice President, Insurance None
Jeff Rold Senior Vice President, Product None
181 East 73rd Street, Apt 20B Business Management
New York, New York 10021
Richard M. Potocki Senior Vice President, Regional None
Seligman International UK Limited Director, Europe and the Middle East
Berkeley Square House 2nd Floor
Berkeley Square
London, United Kingdom W1X 6EA
Bruce M. Tuckey Senior Vice President, Sales None
41644 Chathman Drive
Novi, MI 48375
Andrew S. Veasey Senior Vice President, Sales None
14 Woodside Drive
Rumson, NJ 07760
</TABLE>
C-6
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
<TABLE>
<CAPTION>
Seligman Advisors, Inc.
As of January 31, 2000
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
Charles L. von Breitenbach, II* Senior Vice President, Managed None
Money
J. Brereton Young* Senior Vice President, Director None
of Sales Development
Jeffrey S. Dean* Vice President, Business Analysis None
Ron Dragotta* Vice President, Regional Retirement None
Plans Manager
Mason S. Flinn Vice President, Regional Retirement None
2130 Fillmore Street Plans Manager
PMB 280
San Francisco, CA 94115-2224
Marsha E. Jacoby* Vice President, Offshore Business None
Manager
Jody Knapp Vice President, Regional Retirement None
17011 East Monterey Drive Plans Manager
Fountain Hills, AZ 85268
David W. Mountford Vice President, Regional Retirement None
7131 NW 46th Street Plans Manager
Lauderhill, FL 33319
Ronald W. Pond* Vice President, Portfolio Advisor None
Jeffery C. Pleet* Vice President, Regional Retirement None
Plans Manager
Tracy A. Salomon* Vice President, Retirement Marketing None
Helen Simon* Vice President, Sales Administration None
Gary A. Terpening* Vice President, Director of Business None
Development
John E. Skillman III* Vice President, Portfolio Advisor None
Charles E. Wenzel Vice President, Regional Retirement None
117 Carpetners Row Plans Manager
Mount Chanin, DE 19710
Robert McBride Vice President, Marketing Director None
Seligman International, Inc. Latin America
Sucursal Argentina
Edificio Laminar Plaza
Ingeniero Butty No. 240, 4th Floor
C1001ASB Buenos Aires, Argentina
Daniel Chambers Regional Vice President None
4618 Lorraine Avenue
Dallas, TX 75209
Richard B. Callaghan Regional Vice President None
7821 Dakota Lane
Orland Park, IL 60462
Kevin Casey Regional Vice President None
19 Bayview Avenue
Babylon, NY 11702
</TABLE>
C-7
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
<TABLE>
<CAPTION>
Seligman Advisors, Inc.
As of January 31, 2000
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
Bradford C. Davis Regional Vice President None
241 110th Avenue SE
Bellevue, WA 98004
Cathy Des Jardins Regional Vice President None
PMB 152
1705 14th Street
Boulder, CO 80302
Kenneth Dougherty Regional Vice President None
8640 Finlarig Drive
Dublin, OH 43017
Kelli A. Wirth Dumser Regional Vice President None
7121 Jardiniere Court
Charlotte, NC 28226
Edward S. Finocchiaro Regional Vice President None
120 Screenhouse Lane
Duxbury, MA 02332
Michael C. Forgea Regional Vice President None
32 W. Anapamu Street #186
Santa Barbara, CA 93101
Carla A. Goehring Regional Vice President None
11426 Long Pine Drive
Houston, TX 77077
Michael K. Lewallen Regional Vice President None
908 Tulip Poplar Lane
Birmingham, AL 35244
Judith L. Lyon Regional Vice President None
7105 Harbour Landing
Alpharetta, GA 30005
Leslie A. Mudd Regional Vice President None
5243 East Calle Redonda
Phoenix, AZ 85018
Tim O'Connell Regional Vice President None
11908 Acacia Glen Court
San Diego, CA 92128
George M. Palmer, Jr. Regional Vice President None
1805 Richardson Place
Tampa, FL 33606
Thomas Parnell Regional Vice President None
1575 Edgecomb Road
St. Paul, MN 55116
Craig Prichard Regional Vice President None
9207 Cross Oaks Court
Fairfax Station, VA 22039
Nicholas Roberts Regional Vice President None
200 Broad Street, Apt. 2451
Stamford, CT 06901
Diane H. Snowden Regional Vice President None
11 Thackery Lane
Cherry Hill, NJ 08003
</TABLE>
C-8
<PAGE>
File No. 33-44186
811-6485
PART C. OTHER INFORMATION (continued)
<TABLE>
<CAPTION>
Seligman Advisors, Inc.
As of January 31, 2000
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
James Taylor Regional Vice President None
290 Bellington Lane
Creve Coeur, MO 63141
Steve Wilson Regional Vice President None
83 Kaydeross Park Road
Saratoga Springs, NY 12866
Frank J. Nasta* Secretary Secretary
Aurelia Lacsamana* Treasurer None
Gail S. Cushing* Assistant Vice President, National None
Accounts Manager
Sandra G. Floris* Assistant Vice President, Order Desk None
Keith Landry* Assistant Vice President, Order Desk None
Albert A. Pisano* Assistant Vice President and None
Compliance Officer
Joyce Peress* Assistant Secretary Assistant Secretary
</TABLE>
* The principal business address of each of these directors and/or officers is
100 Park Avenue, New York, NY 10017.
(c) Not applicable.
Item 28. Location of Accounts and Records. The accounts, books and other
documents required to be maintained by Section 31(a) of the Investment
Company Act of 1940, as amended, and the Rules 17 CFR 270.31(a)-1 to
31(a)-3 promulgated thereunder, are maintained by J. & W. Seligman &
Co. Incorporated located at 100 Park Avenue, New York, NY 10017 and at
the following locations: (1) Custodian for the Funds: Chase Manhattan
Bank, 1 Pierrepont Plaza, Brooklyn, New York 11201; (2) Recordkeeping
Agent for the Funds: State Street Bank & Trust Company, 801
Pennsylvania, Kansas City, Missouri 64105; and, (3) Transfer Agent,
Redemption and Other Shareholder Account Services for the Funds:
Seligman Data Corp., 100 Park Avenue, New York, NY 10017.
Item 29. Management Services. Not Applicable.
Item 30. Undertakings. Registrant undertakes: (1) to furnish a copy of
Registrant's latest Annual Report, upon request and without charge, to
every person to whom a prospectus is delivered, and (2) if requested
to do so by the holders of at least 10% of its outstanding shares, to
call a meeting of shareholders for the purpose of voting upon the
removal of a director or directors and to assist in communications
with other shareholders as required by Section 16(c) of the Investment
Company Act of 1940, as amended.
C-9
<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 all of the
requirements for effectiveness of this Post-Effective Amendment No. 29 pursuant
to Rule 485(b) under the Securities Act of 1933 and has duly caused this
Post-Effective Amendment No. 29 to its Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of New
York, State of New York, on the 25th day of February, 2000.
SELIGMAN GLOBAL FUND SERIES, INC.
By: /s/ William C. Morris
---------------------------------
William C. Morris, Chairman
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, this Post-Effective Amendment No. 29 to its Registration
Statement has been signed below by the following persons in the capacities
indicated on February 25, 2000.
Signature Title
/s/ William C. Morris Chairman of the Board (Principal
- --------------------------- executive officer) and Director
William C. Morris
/s/ Brian T. Zino President and Director
- ---------------------------
Brian T. Zino
/s/ Thomas G. Rose Treasurer (Principal financial and
- --------------------------- and accounting officer)
Thomas G. Rose
John R. Galvin, Director )
Alice S. Ilchman, Director )
Frank A. McPherson, Director )
John E. Merow, Director ) /s/ Brian T. Zino
Betsy S. Michel, Director ) ---------------------------------
James C. Pitney, Director ) Brian T. Zino, Attorney-in-fact
James Q. Riordan, Director )
Richard R. Schmaltz, Director )
Robert L. Shafer, Director )
James N. Whitson, Director )
<PAGE>
SELIGMAN GLOBAL FUND SERIES, INC.
Post-Effective Amendment No. 29 to the
Registration Statement on Form N-1A
EXHIBIT INDEX
Form N-1A Item No. Description
- ------------------ -----------
Item 23(j) Consent of Independent Auditors
Item 23(p) Code of Ethics
[LETTERHEAD OF DELOITTE & TOUCHE]
CONSENT OF INDEPENDENT AUDITORS
Seligman Global Fund Series, Inc.:
We consent to the use in Post-Effective Amendment No. 29 to Registration
Statement No. 33-44186 of our report dated December 10, 1999, appearing in the
Annual Report to Shareholders for the year ended October 31, 1999, incorporated
by reference in the Statement of Additional Information, and to the reference to
us under the caption "Financial Highlights" in the Prospectus, which is also
part of such Registration Statement.
/s/ DELOITTE & TOUCHE LLP
New York, New York
February 23, 2000
CODE OF ETHICS
J. & W. Seligman & Co. Incorporated
Seligman Advisors, Inc.
Seligman Services, Inc.
Seligman Data Corp.
Seligman International, Inc.
Seligman International UK Limited
The Seligman Group of Investment Companies
I. Introduction
A primary duty of all directors, officers and employees (collectively
"Employees") of J. & W. Seligman & Co. Incorporated, its subsidiaries and
affiliates (collectively, "Seligman") is to be faithful to the interest of the
various Seligman advisory clients, including the registered and unregistered
companies advised by Seligman (collectively, "Clients"). Directors of the
Seligman Registered Investment Companies also have a duty to the Seligman
Registered Investment Companies and their shareholders. Persons who are
Disinterested Directors are "Employees" for purposes of this Code of Ethics.
Through the years, Seligman and its predecessor organizations have had a
reputation of maintaining the highest business and ethical standards and have
been favored with the confidence of investors and the financial community. Such
a reputation and confidence are not easily gained and are among the most
precious assets of Seligman. In large measure, they depend on the devotion and
integrity with which each Employee discharges his or her responsibilities. Their
preservation and development must be a main concern of each Employee, and each
Employee has a primary obligation to avoid any action or activity that could
produce conflict between the interest of the Clients and that Employee's
self-interest.
The purpose of this Code of Ethics ("Code") is to set forth the policies of
Seligman in the matter of conflicts of interest and to provide a formal record
for each Employee's reference and guidance. This Code is also designed to
prevent any act, practice or course of business prohibited by the rules and
regulations governing our industry.
Each Employee owes a fiduciary duty to each Client. Therefore, all Employees
must avoid activities, interests and relationships that might appear to
interfere with making decisions in the best interest of the Clients.
As an Employee, you must at all times:
1. Avoid serving your own personal interests ahead of the interests of
Clients. You may not cause a Client to take action, or not to take action,
for your personal benefit rather than the Client's benefit.
2. Avoid taking inappropriate advantage of your position. The receipt of
investment opportunities, perquisites or gifts from persons seeking
business with Clients or with Seligman could call into question the
exercise of your better judgment. Therefore, you must not give or receive
benefits that would compromise your ability to act in the best interest of
the Clients.
3. Conduct all personal Securities Transactions in full compliance with the
Code, including the pre-authorization and reporting requirements, and
comply fully with the Seligman Insider Trading Policies and Procedures (See
Appendix A).
While Seligman encourages you and your families to develop personal investment
programs, you must not take any action that could cause even the appearance that
an unfair or improper action has been taken. Accordingly, you must follow the
policies set forth below with respect to trading in your Account(s). This Code
places reliance on the good sense and judgment of you as an Employee; however,
if you are unclear as to the Code's meaning, you should seek the advice of the
Law and Regulation Department and assume the Code will be interpreted in the
most restrictive manner. Questionable situations should be resolved in favor of
Clients.
<PAGE>
Technical compliance with the Code's procedures will not insulate from scrutiny
any trades that indicate a violation of your fiduciary duties.
Application of the Code to Disinterested Directors
Disinterested Directors are only subject to the reporting requirements in
Section III.5(b) of the Code. Disinterested Directors are not subject to other
provisions of the Code but are subject to the requirements of the federal
securities laws and other applicable laws, such as the prohibition on trading in
securities of an issuer while in possession of material non-public information.
II. Definitions
(a) "Accounts" means all Employee Accounts and Employee Related Accounts.
(b) "Beneficial Interest" is broadly interpreted. The SEC has said that
the final determination of Beneficial Interest is a question to be
determined in the light of the facts of each particular case. The
terms Employee Account and Employee Related Account, as defined below,
generally define Beneficial Interest. However, the meaning of
"Beneficial Interest" may be broader than that described below. If
there are any questions as to Beneficial Interest, please contact the
Director of Compliance, General Counsel or Associate General Counsel.
(i) "Employee Account" means the following securities Accounts: (i)
any of your personal account(s); (ii) any joint or
tenant-in-common account in which you have an interest or are a
participant; (iii) any account for which you act as trustee,
executor, or custodian; (iv) any account over which you have
investment discretion or otherwise can exercise control,
including the accounts of entities controlled directly or
indirectly by you; (v) any account in which you have a direct or
indirect interest through a contract, arrangement or otherwise
(e.g., economic, voting power, power to buy or sell, or
otherwise); (vi) any account held by pledges, or for a
partnership in which you are a member, or by a corporation which
you should regard as a personal holding company; (vii) any
account held in the name of another person in which you do not
have benefits of ownership, but which you can vest or revest
title in yourself at once or some future time; (viii) any account
of which you have benefit of ownership; and (ix) accounts
registered by custodians, brokers, executors or other fiduciaries
for your benefit.
(ii) "Employee Related Account" means any Account of (i) your spouse
and minor children and (ii) any account of relatives or any other
persons to whose support you materially contribute, directly or
indirectly.
(c) "Disinterested Director" means a director or trustee of a Seligman
Registered Investment Company who is not an "interested person" of
such investment company within the meaning of Section 2(a)(19) of the
Investment Company Act of 1940.
(d) "Equivalent Security" includes, among other things, an option to
purchase or sell a Security or an instrument convertible or
exchangeable into a Security.
(e) "Investment Team" means one or more Investment Teams formed by the
Manager in various investment disciplines to review and approve
Securities for purchase and sale by Client Accounts. This includes a
team's leader, portfolio managers, research analysts, traders and
their direct supervisors.
(f) "Security" includes, among other things, stocks, notes, bonds,
debentures, and other evidences of indebtedness (including loan
participation and assignments), limited partnership interests,
investment contracts, and all derivative instruments (e.g., options
and warrants).
<PAGE>
(g) "Securities Transaction" means a purchase or sale of a Security.
(h) "Seligman Registered Investment Company" means an investment company
registered under the Investment Company Act of 1940 for which Seligman
serves as investment manager or adviser.
III. Personal Securities Transactions
1. Prohibited Transactions
These apply to all of your Accounts.
(a) Seven-Day Blackout: If you are a member of an Investment Team,
Securities Transactions are prohibited within seven calendar days
either before or after the purchase or sale of the relevant security
(or an Equivalent Security) by a Client whose Account is managed by
your Investment Team.
(b) Intention to Buy or Sell for Clients: Securities Transactions are
prohibited at a time when you intend, or know of another's intention,
to purchase or sell that Security (or an Equivalent Security) on
behalf of a Client.
(c) Sixty-Day Holding Period: Profits on Securities Transactions made
within a sixty-day period are prohibited and must be disgorged. This
is a prohibition of short term trading. Specifically,
o Purchase of a Security within 60 days of your sale of the
Security (or an Equivalent Security), at a price that is less
than the price in the previous sale is prohibited.
o Sale of a Security within the 60 day period of your purchase of
the Security (or an Equivalent Security), at a price that is
greater than the price in the previous purchase is prohibited.
Examples are as follows:
1. Employee purchases 100 shares of XYZ ($10 a share) on January 1.
Employee sells 100 shares of XYZ ($15 a share) on February 15.
Employee must disgorge $500.
2. Employee purchases 100 shares of XYZ ($10 a share) on January 1.
Employee purchases 50 shares of XYZ ($12 a share) on January 30.
Employee sells 50 shares of XYZ ($15 a share) on March 15.
Employee must disgorge $150. (The March 15 sale may not be
matched to the January 1 purchase).
3. Employee purchases 100 shares of XYZ ($10 a share) on January 1.
Employee sells 100 shares of XYZ ($10 a share) on February 1.
Employee purchases 100 shares of XYZ ($9 a share) on March 1
Employee must disgorge $100. (The February 1 sale is permissible
because no profit was made. However, the March 1 purchase is
matched against the February 1 sale resulting in a $100 profit).
(d) Restricted Transactions: Transactions in a Security are prohibited (i)
on the day of a purchase or sale of the Security by a Client, or (ii)
anytime a Client's order in the Security is open on the trading desk.
Other Securities may be restricted from time to time as deemed
appropriate by the Law and Regulation Department.
<PAGE>
(e) Short Sales: If you are a member of an Investment Team, you may not
engage in any short sale of a Security if, at the time of the
transaction, any Client managed by your Team has a long position in
that same Security. However, this prohibition does not prevent you
from engaging short sales against the box and covered call writing, as
long as these personal trades are in accordance with the sixty-day
holding period described above.
(f) Public Offerings: Acquisitions of Securities in initial and secondary
public offerings are prohibited, unless granted an exemption by the
Director of Compliance. An exemption for an initial public offering
will only be granted in certain limited circumstances, for example,
the demutualization of a savings bank.
(g) Private Placements: Acquisition of Securities in a private placement
is prohibited absent prior written approval by the Director of
Compliance.
(h) Market Manipulation: Transactions intended to raise, lower, or
maintain the price of any Security or to create a false appearance of
active trading are prohibited.
(i) Inside Information: You may not trade, either personally or on behalf
of others, on material, non-public information or communicate
material, non-public information to another in violation of the law.
This policy extends to activities within and outside your duties at
Seligman. (See Appendix A).
2. Maintenance of Accounts
All Accounts that have the ability to engage in Securities Transactions
must be maintained at Ernst & Company (Investec) and/or the specific
Merrill Lynch branch office located at 712 Fifth Avenue, New York, NY. You
are required to notify the Director of Compliance of any change to your
account status. This includes opening a new Account, converting,
transferring or closing an existing account or acquiring Beneficial
Interest in an Account through marriage or otherwise. You must place all
orders for Securities Transactions in these Account(s) with the Equity
Trading Desk or the appropriate Fixed Income Team as set forth in Section
III.3 ("Trade Pre-authorization Requirements").
The Director of Compliance may grant exceptions to the foregoing
requirements on a case by case basis. All requests for exceptions must be
applied for in writing and submitted for approval to the Director of
Compliance and will be subject to certain conditions.
3. Trade Pre-authorization Requirements
All Securities Transactions in an Employee Account or Employee Related
Account must be pre-authorized, except for Securities Transactions set
forth in Section III.4 ("Exempt Transactions").
(a) Trade Authorization Request Form: Prior to entering an order for a
Securities Transaction in an Employee Account or Employee Related
Account, which is subject to pre-authorization, you must complete a
Trade Authorization Request Form (set forth in Appendix B) and submit
the completed Form (faxed or hand delivered) to the Director of
Compliance (or designee).
(b) Review of the Form and Trade Execution: After receiving the completed
Trade Authorization Request Form, the Director of Compliance (or
designee) will review the information and, as soon as practical,
determine whether to authorize the proposed Securities Transaction.
The authorization, date and time of the authorization must be
reflected on the Form. Once approved the order may then be executed by
Equity Trading Desk or the appropriate Fixed Income Team, except for
accounts for which an exemption was granted under Section III.2.
<PAGE>
(c) Length of Trade Authorization Approval: Any authorization, if granted,
is effective until the earliest of (i) its revocation, (ii) the close
of business on the day from which authorization was granted or (iii)
your discovery that the information in the Trade Authorization Request
Form is no longer accurate. If the Securities Transaction was not
placed or executed within that period, a new pre-authorization must be
obtained. A new pre-authorization need not be obtained for orders
which cannot be filled in one day due to an illiquid market, so long
as such order was placed for execution on the day the original
pre-authorization was given.
No order for a Securities Transaction may be placed prior to the Director
of Compliance (or designee) receiving the completed Trade Pre-authorization
Form and approving the transaction. In some cases, trades may be rejected
for a reason that is confidential.
4. Exempt Transactions
The prohibitions of this Code shall not apply to the following Securities
Transactions in your Account(s):
(a) Purchases or sales of Securities which are non-volitional (i.e., not
involving any investment decision or recommendation).
(b) Purchases of Securities through certain corporate actions (such as
stock dividends, dividend reinvestments, stock splits, mergers,
consolidations, spin-offs, or other similar corporate reorganizations
or distributions generally applicable to all holders of the same class
of Securities).
(c) Purchases of Securities effected upon the exercise of rights issued by
an issuer pro rata to all holders of a class of its Securities, to the
extent such rights were acquired from the issuer.
(d) Purchases or sales of open-end registered investment companies, U.S.
Government Securities and money market instruments (e.g., U.S.
Treasury Securities, bankers acceptances, bank certificates of
deposit, commercial paper and repurchase agreements).
(e) Purchases of Securities which are part of an automatic dividend
reinvestment plan or stock accumulation plan; however, quarterly
account statement of such plans must be sent to the Director of
Compliance.
(f) Securities Transactions that are granted a prior exemption by the
Director of Compliance, the General Counsel or the Associate General
Counsel.
5. Reporting
(a) You must arrange for the Director of Compliance to receive from the
executing broker, dealer or bank duplicate copies of each confirmation
and account statement for each Securities Transaction in an Employee
Account or Employee Related Account.
(b) If you are a Disinterested Director you are required to report the
information specified below with respect to any Securities Transaction
in any Securities Account in which you have Beneficial Interest, if
you knew, or in the ordinary course of fulfilling your official duties
as a Disinterested Director, should have known, that during 15 days
immediately before or after the date of your transaction, the Security
(or Equivalent Security) was purchased or sold by a Seligman
Registered Investment Company or considered for purchase or sale by a
Seligman Registered Investment Company. Such report shall be made not
later than 10 days after the end of the calendar quarter in which the
Transaction was effected and shall contain the following information:
<PAGE>
(i) The date of the transaction, the name of the company, the number
of shares, and the principal amount of each Security involved;
(ii) The nature of the transaction (i.e., purchase, sale or any other
type of acquisition or disposition);
(iii) The price at which the transaction was effected;
(iv) The name of the broker, dealer or bank with or through whom the
transaction was effected; and
(v) The date the report is submitted.
(c) You are required to disclose all Securities beneficially owned by you
within ten days of commencement of employment and at the end of each
calendar year within 10 days thereafter (See Appendix C).
(d) You are also required to disclose all Employee and Employee Related
Securities Accounts, Private Securities Transactions and Outside
Activities, Affiliations and Investments upon commencement of
employment and annually thereafter (See Appendix D).
(e) Any report may contain a statement that the report shall not be
construed as an admission by you, that you have any direct or indirect
beneficial ownership in the Security to which the report relates.
(f) The Director of Compliance or his designee will review all reports.
6. Dealings with the Clients
You should not have any direct or indirect investment interest in the
purchase or sale of any Security or property from or to Clients. This is a
prohibition against dealings between you and the Clients and is not
intended to preclude or limit investment transactions by you in Securities
or property, provided such transactions are not in conflict with the
provisions of this Code.
7. Preferential Treatment, Favors and Gifts
You are prohibited from giving and receiving gifts of significant value or
cost from any person or entity that does business with or on behalf of any
Client. You should also avoid preferential treatment, favors, gifts and
entertainment which might, or might appear to, influence adversely or
restrict the independent exercise of your best efforts and best judgments
on behalf of the Clients or which might tend in any way to impair
confidence in Seligman by Clients. Cash Gifts that do not exceed $100 in
value per person for a calendar year are permissible. Ordinary courtesies
of business life, or ordinary business entertainment, and gifts of
inconsequential value are also permissible. However, they should not be so
frequent nor so extensive as to raise any question of impropriety.
8. Outside Business Activities and Service as a Director, Trustee or in a
Fiduciary Capacity of any Organization
You may not engage in any outside business activities or serve as a
Director, Trustee or in a fiduciary capacity of any organization, without
the prior written consent of the Director of Compliance.
<PAGE>
9. Remedies of the Code
Upon discovering a violation of this Code, sanctions may be imposed against
the person concerned as may be deemed appropriate, including, among other
things, a letter of censure, fines, suspension or termination of personal
trading rights and/or employment.
As part of any sanction, you may be required to absorb any loss from the
trade. Any profits realized, as a result of your personal transaction that
violates the Code must be disgorged to a charitable organization, which you
may designate.
10. Compliance Certification
At least once a year, you will be required to certify on the Employee
Certification Form (set forth in Appendix E) that you have read and
understand this Code, that you have complied with the requirements of the
Code, and that you have disclosed or reported all personal Securities
Transactions pursuant to the provisions of the Code.
11. Inquiries Regarding the Code
If you have any questions regarding this Code or any other
compliance-related matter, please call the Director of Compliance, or in
his absence, the General Counsel or Associate General Counsel.
--------------------------------
William C. Morris
Chairman
December 22, 1966
Revised: March 8, 1968 December 7, 1990
January 14, 1970 November 18, 1991
March 21, 1975 April 1, 1993
May 1, 1981 November 1, 1994
May 1, 1982 February 28, 1995
April 1, 1985 November 19, 1999*
March 27, 1989
* Refers to the incorporation of the Code of Ethics of the Seligman Investment
Companies originally adopted June 12, 1962, as amended.
<PAGE>
Appendix A
Amended November 19, 1999
J. & W. Seligman & Co. Incorporated - Insider Trading Policies and Procedures
SECTION I. BACKGROUND
Introduction
United States law creates an affirmative duty on the part of broker-dealers
and investment advisers to establish, maintain and enforce written policies and
procedures that provide a reasonable and proper system of supervision,
surveillance and internal control to prevent the misuse of material, non-public
information by the broker-dealer, investment adviser or any person associated
with them. The purpose of these procedures is to meet those requirements. The
following procedures apply to J. & W. Seligman & Co. Incorporated, its
subsidiaries and affiliates (collectively, "Seligman") and all officers,
directors and employees (collectively, "Employees") thereof.
Statement of Policy
No Employee may trade, either personally or on behalf of others, on
material, non-public information or communicate material, non-public information
to another in violation of the law. This policy extends to activities within and
outside their duties at Seligman. Each Employee must read, acknowledge receipt
and retain a copy of these procedures.
Inside Information
The term "insider trading" is not defined in the federal securities laws,
but generally is used to refer to the use of material, non-public information to
trade in securities or to communicate material, non-public information to
others.
While the law concerning insider trading is not static, it is understood
that the law generally prohibits:
A. trading by an insider, while in possession of material, non-public
information, or
B. trading by a non-insider, while knowingly in possession of material,
non-public information, where the information either was disclosed to
the non-insider in violation of an insider's duty to keep it
confidential or was misappropriated, or
C. communicating material, non-public information to others.
The elements of insider trading and the penalties for such unlawful conduct
are discussed below. If you have any questions after reviewing these procedures,
you should consult the Director of Compliance, General Counsel or Associate
General Counsel.
1. Who Is An Insider?
The concept of "insider" is broad. It includes Employees of a company. In
addition, a person can be a "temporary insider" if he or she enters into a
special confidential relationship in the conduct of a company's affairs and
as a result is given access to information solely for the company's
purposes. A temporary insider can include, among others, a company's
attorneys, accountants, consultants, bank lending officers, and the
Employees of such organizations. In addition, Seligman may become a
temporary insider of a company it advises or for which it performs other
services. According to the Supreme Court, the company must expect the
outsider to keep the disclosed non-public information
<PAGE>
confidential and the relationship must at least imply such a duty before
the outsider will be considered an insider.
2. What Is Material Information?
Trading on inside information is not a basis for liability unless the
information is material. "Material information" generally is defined as
information for which there is a substantial likelihood that a reasonable
investor would consider it important in making his or her investment
decisions, or information that is reasonably certain to have a substantial
affect on the price of a company's securities. Information that Employees
should consider material includes, but is not limited to: dividend changes,
earnings estimates, changes in previously released earnings estimates,
significant merger or acquisition proposals or agreements, major
litigation, liquidation problems and extraordinary management developments.
In addition, information about major contracts or new customers could also
qualify as material, depending upon the importance of such developments to
the company's financial condition or anticipated performance.
Material information does not have to relate to a company's business. For
example, in Carpenter v. U.S., 408 U.S. 316 (1987), the Supreme Court
considered as material certain information about the contents of a
forthcoming newspaper column that was expected to affect the market price
of a Security. In that case, a Wall Street Journal reporter was found
criminally liable for disclosing to others the dates that reports on
various companies would appear in the Journal and whether those reports
would be favorable or not.
3. What Is Non-Public Information?
Information is non-public until it has been effectively communicated to the
market place. One must be able to point to some fact to show that the
information is generally public. For example, information found in a report
filed with the SEC, or appearing in Dow Jones, Reuters Economic Services,
The Wall Street Journal or other publications of general circulation would
be considered public. However, see Section II, Paragraph 2.
4. Penalties for Insider Trading
Penalties for trading on or communicating material, non-public information
are severe, both for individuals involved in such unlawful conduct and
their employers. A person can be subject to some or all of the penalties
below even if he or she does not personally benefit from the violation.
Penalties include:
- Civil injunctions
- Disgorgement of profits
- Jail sentences
- Fines for the person who committed the violation of up to three times
the profit gained or loss avoided, whether or not the person actually
benefited, and
- Fines for the employer or other controlling person of up to the
greater of $1,000,000 or three times the amount of the profit gained
or loss avoided.
In addition, any violation of policies and procedures set forth herein can
be expected to result in serious sanctions by Seligman, including dismissal of
the persons involved.
<PAGE>
SECTION II. PROCEDURES
Procedures to Implement Policy Against Insider Trading.
The following procedures have been established to assist the Employees of
Seligman in avoiding insider trading, and to aid Seligman in preventing,
detecting and imposing sanctions against insider trading. Every Employee of
Seligman must follow these procedures or risk serious sanctions, including
dismissal, substantial personal liability and criminal penalties. If you have
any questions about these procedures you should consult the Director of
Compliance, the General Counsel or Associate General Counsel.
1. Identifying Inside Information.
Before trading for yourself or others (including investment companies and
private Accounts managed by Seligman), in the securities of a company about
which you may have potential inside information, ask yourself the following
questions:
a. Is the information material? Is this information that an investor
would consider important in making his or her investment decisions? Is
this information that would substantially affect the market price of
the securities if generally disclosed?
b. Is the information non-public? To whom has this information been
provided? Has the information been effectively communicated to the
marketplace in a publication of general circulation or does it fall
within the circumstances set forth in paragraph 2 below.
If, after consideration of the above, you believe that the information is
material and non-public, or if you have questions as to whether the information
is material and non-public, you should take the following steps:
c. Report the matter immediately to the Director of Compliance, General
Counsel or Associate General Counsel.
d. Do not purchase or sell the securities on behalf of yourself or
others, including investment companies or private Accounts managed by
Seligman.
e. Do not communicate the information inside or outside Seligman other
than to the Director of Compliance, General Counsel or Associate
General Counsel.
f. After the Director of Compliance, General Counsel or Associate General
Counsel has reviewed the issue, you will be instructed to continue the
prohibitions against trading and communication, or you will be allowed
to trade and communicate the information.
2. Important Specific Examples
a. If you have a telephone or face-to-face conversation with a senior
executive of a publicly-traded company and are provided information
about the company that you have reason to believe has not yet been
disclosed in a widely-disseminated publication such as a press
release, quarterly report or other public filing, you have received
non-public information. This information is considered non-public even
if you believe that the company executive would provide the same
information to other analysts or portfolio managers who call the
company. Until information has been disclosed in a manner that makes
it available to (or capable of being accessed by) the investment
community as a whole, it is considered non-public. If the information
is material, as described above, you may not trade while in possession
of this information unless you first discuss the matter and obtain
approval from the Director of Compliance, General Counsel or Associate
General Counsel. Although it may be lawful for an analyst to act on
the basis of material information that the company's management has
chosen to disclose selectively to that analyst, where the information
is provided in a one-on-one context,
<PAGE>
regulators are likely to question such conduct. Approval from the Law
and Regulation Department will therefore depend on the specific
circumstances of the information and the disclosure. Under the Supreme
Court's important decision of Dirks v. SEC, 463 U.S. 646 (1983),
securities analysts may be free to act on selectively disclosed
material information if it is provided by company executives
exclusively to achieve proper corporate purposes.
b. If you obtain material information in the course of an analysts'
conference call or meeting conducted by a publicly-traded company in
the ordinary course of its business in which representatives of
several other firms or investors are also present (as distinguished
from the one-on-one situation described in the preceding paragraph),
you may act on the basis of that information without need to consult
with the Director of Compliance, General Counsel or Associate General
Counsel, even if the information has not yet been published by the
news media. You should be aware, however, that if there is something
highly unusual about the meeting or conference call that leads you to
question whether it has been authorized by the company or is otherwise
suspect, you should first consult with the Director of Compliance,
General Counsel or Associate General Counsel.
c. If you are provided material information by a company and are
requested to keep such information confidential, you may not trade
while in possession of that information before first obtaining the
approval of the Director of Compliance, General Counsel or the
Associate General Counsel.
As these examples illustrate, the legal requirements governing insider
trading are not always obvious. You should therefore always consult with the
Director of Compliance, General Counsel or Associate General Counsel if you have
any question at all about the appropriateness of your proposed conduct.
3. Restricting Access To Material, Non-Public Information
Information in your possession that you identify as material and non-public
may not be communicated to anyone, including persons within Seligman,
except as provided in paragraphs 1 and 2 above. In addition, care should be
taken so that such information is secure. For example, files containing
material, non-public information should be sealed; access to computer files
containing material, non-public information should be restricted.
4. Resolving Issues Concerning Insider Trading
If, after consideration of the items set forth in paragraphs 1 and 2, doubt
remains as to whether information is material or non-public, or if there is
any unresolved question as to the applicability or interpretation of the
foregoing procedures, or as to the propriety of any action, it must be
discussed with the Director of Compliance, General Counsel and or the
Associate General Counsel before trading or communicating the information
to anyone.
5. Personal Securities Trading
All Employees shall follow with respect to personal Securities trading the
procedures set forth in the Code of Ethics. In addition, no Employee shall
establish a brokerage Account with a Firm other than those previously
approved without the prior consent of the Director of Compliance and every
Employee shall be subject to reporting requirements under Section III.5 of
the Code of Ethics. The Director of Compliance, or his designee, shall
monitor the personal Securities trading of all Employees.
<PAGE>
Appendix B
Amended November 19, 1999
J. & W. SELIGMAN & CO. INCORPORATED
TRADE AUTHORIZATION REQUEST FORM
<TABLE>
<S> <C>
1. Name of Employee/Telephone Number: ______________________________
2. If different than #1, name of the person in whose
account the trade will occur: ______________________________
3. Relationship of (2) to (1): ______________________________
4. Name the firm at which the account is held: ______________________________
5. Name of Security: ______________________________
6. Number of shares or units to be bought or
sold or amount of bond: ______________________________
7. Approximate price per share, unit or bond: ______________________________
8. Check those that are applicable: _______ Purchase ______ Sale
_____ Market Order ______ Limit Order (Price of Limit Order: _____)
9. Do you possess material non public information regarding
the Security or the issuer of the Security? ______ Yes ______ No
10. To your knowledge, are there any outstanding (purchase or
sell) orders for this Security or any Equivalent Security by
a Seligman Client? ______ Yes ______ No
11. To your knowledge, is this Security or Equivalent Security
being considered for purchase or sale for one or more
Seligman Clients? ______ Yes ______ No
12. Is this Security being acquired in an initial or secondary public
offering? ______ Yes ______ No
13. Is this Security being acquired in a private placement? ______ Yes ______ No
14. Have you or any Related Account covered by the pre-
authorization provisions of the Code purchased or sold
this Security within the past 60 days? ______ Yes ______ No
</TABLE>
<PAGE>
- - - - - -
For Investment Team Members Only:
15. Has any Client Account managed by your team purchased or sold this
Security or Equivalent Security within the past seven calendar days or do
you expect any such account to purchase or sell this Security or
Equivalent Security within seven
calendar days of your purchase or sale? ______ Yes ______ No
16. Why is this Security Transaction appropriate for you and not for one or
more of your team's Clients?
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
- - - - - -
I have read the J. & W. Seligman & Co. Incorporated Code of Ethics, as revised
on November 19, 1999, within the prior 12 months and believe that the proposed
trade(s) fully complies with the requirements of the Code of Ethics and Insider
Trading policy.
_____________________________
Employee Signature
_____________________________
Date Submitted
Authorized by: ________________________
Date: ________________________
<PAGE>
Appendix C
Amended November 19, 1999
REPORT OF SECURITIES BENEFICIALLY OWNED
AS OF DECEMBER 31, 1999
The following is a list of all Securities positions (except open-end
investment companies, U.S. Government Securities and money market instruments)
in which I have direct or indirect beneficial ownership, as defined in the Code
of Ethics. This includes Securities held at home, in safe deposit boxes or by an
issuer.
<TABLE>
<CAPTION>
Description of Security No. of Shares Principal Amount Location of Security
<S> <C> <C> <C>
- -------------------------- ------------ ------------------- ------------------
- -------------------------- ------------ ------------------- ------------------
- -------------------------- ------------ ------------------- ------------------
- -------------------------- ------------ ------------------- ------------------
- -------------------------- ------------ ------------------- ------------------
- -------------------------- ------------ ------------------- ------------------
</TABLE>
_______ The list above (and any additional sheets I have attached)
represents all my Securities positions in which I have direct
or indirect beneficial ownership as defined in the Code of
Ethics.
_______ I only have a beneficial ownership interest in open-end
investment companies, U.S. Government Securities and money
market instruments, and/or I do not beneficially own any
Securities.
Date: ________________________ _____________________________
First Last, Company
<PAGE>
Appendix D
Amended November 19, 1999
EMPLOYEE REPORTING QUESTIONNAIRE
<TABLE>
<S> <C>
Employee Name: ___________________________ Ext: ______ Department: ___________________
Please Print
Company/Affiliate: ______________________________ Supervisor: ___________________
1. Securities Accounts
Do you have any Accounts in which Securities can be purchased or sold over
which you have control or in which you have a Beneficial Interest, as
defined in Seligman's Code of Ethics?
Yes _______ No ________
If yes, please list all such Accounts:
Account Account Type of
Institution Number Title Account
---------------------------- ---------------- -------------------------- --------------
---------------------------- ---------------- -------------------------- --------------
---------------------------- ---------------- -------------------------- --------------
2. Financial Interests
Do you have any private placements, restricted stock warrants, general or
limited partnerships, or other investment interests in any organization
(public, private or charitable) not held in the accounts listed above?
Please include Securities and certificates held in your custody.
Yes _______ No _______
If yes, please describe: ______________________________________________________________________________
_______________________________________________________________________________________________________
3. Outside Activities/Affiliations
a) Do you have any activities outside Seligman or its affiliates for which
you receive additional compensation:
Yes _______ No _______
If yes, please describe: ______________________________________________________________________________
_______________________________________________________________________________________________________
b) Do you serve in the capacity of officer, director, partner or employee
(or in any other fiduciary capacity) for any company or organization
(public, private or charitable) other than Seligman or its affiliates.
Yes ________ No _______
If yes, please describe: ______________________________________________________________________________
_______________________________________________________________________________________________________
I hereby certify that I have read and understand the foregoing statements
and that each of my responses thereto are true and complete. I agree to
immediately inform the Director of Compliance if there is any change in any
of the above answers. I also understand that any misrepresentation or
omissions of facts in response to this questionnaire and failure to
immediately inform the Director of Compliance of any changes to responses
provided herein may result in termination of my employment.
____________________________________ __________________________
Employee's Signature Date
____________________________________
Title
</TABLE>
<PAGE>
Appendix E
Amended November 19, 1999
Annual Certification of Compliance with the Code of Ethics
I acknowledge that I have received and read the Code of Ethics and Insider
Trading Policies and Procedures, as amended on November 19, 1999 and hereby
agree, in consideration of my continued employment by J. & W. Seligman & Co.
Incorporated, or one of its subsidiaries or affiliates, to comply with the Code
of Ethics and Insider Trading Policies and Procedures.
I hereby certify that during the past calendar year:
1. In accordance with the Code of Ethics, I have fully disclosed the
Securities holdings in my Employee Account(s) and Employee Related
Account(s) (as defined in the Code of Ethics).
2. In accordance with the Code of Ethics, I have maintained all Employee
Accounts and Employee Related Accounts at Ernst & Company (Investec) or
Merrill Lynch located at 712 Fifth Avenue, New York, NY except for Accounts
as to which the Director of Compliance has provided written permission to
maintain elsewhere.
3. In accordance with the Code of Ethics, except for transactions exempt from
reporting under the Code of Ethics, I have arranged for the Director of
Compliance to receive duplicate confirmations and statements for each
Securities Transaction of all Employee Accounts and Employee Related
Accounts, and I have reported all Securities Transactions in each of my
Employee Accounts and Employee Related Accounts.
4. I have complied with the Code of Ethics in all other respects.
_______________________________
Employee Signature
_______________________________
Date:____________ Print Name
