<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
BT PYRAMID MUTUAL FUNDS
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
August 23, 1999
Dear Shareholder:
On June 4, 1999, Bankers Trust merged with Deutsche Bank A.G. As a result
of the merger, we are asking shareholders of BT Mutual Funds to approve new
advisory agreements. Enclosed is further information relating to these
changes, including a Questions & Answers section and proxy card(s).
Important information about the changes:
. The merger has no effect on the number of shares you own or the
value of those shares.
. The advisory fees payable under the new advisory agreements have
not increased.
. The investment objective and policies of your mutual fund invest-
ment have not changed.
In addition to the change in advisory agreements, shareholders are also
being asked to approve other changes outlined in the enclosed Proxy Statement.
The Board of Trustees of your BT Mutual Fund believes that the proposals are
important and recommends that you read the enclosed materials carefully and
then vote for all proposals.
What you need to do:
. Read all enclosed materials including the Questions & Answers
section.
. Choose one of the following options to vote:
1. By Mail: Complete the enclosed proxy card and return in
postage-paid envelope provided.
2. By Telephone: Call the Toll-Free # on your proxy card.
3. By Internet: Logon to www.proxyvote.com.
4. Attend Shareholder Meeting (details enclosed).
Please note: if you own shares of more than one Fund, you will receive
more than one proxy card. Please sign and return each proxy card you receive.
Sincerely,
/s/ Daniel O. Hirsch
Daniel O. Hirsch
Secretary
BT Mutual Funds
<PAGE>
QUESTIONS AND ANSWERS
IMPORTANT NEWS
FOR SHAREHOLDERS OF BT PYRAMID MUTUAL FUNDS
Here is a brief overview of some matters affecting your Fund which require
a shareholder vote. We encourage you to read the full text of the enclosed
Proxy Statement, and to vote your shares.
Q. What has happened to require a shareholder vote?
A. On June 4, 1999, Bankers Trust became a subsidiary of Deutsche Bank
A.G. The combined entity now ranks as the fourth largest investment
manager in the world with $670-billion in assets in a full range of
active and index strategies.
To ensure that Bankers Trust or an affiliate may continue to serve as
investment adviser of the BT Mutual Funds, we are seeking shareholder
approval of new advisory agreements.
THE BOARD MEMBERS OF YOUR FUND RECOMMEND THAT YOU VOTE FOR THESE PRO-
POSALS.
Q. Why am I being asked to vote on the new advisory agreements?
A. The Investment Company Act, which regulates investment companies in
the United States such as your BT Mutual Fund, requires a shareholder
vote to approve a new advisory agreement following certain types of
business combinations. Each of the new advisory agreements became ef-
fective immediately upon consummation of the merger and will continue
in effect only upon shareholder approval.
Q. How does the merger affect my BT Mutual Fund?
A. Your BT Mutual Fund and its respective investment objectives have not
changed as a result of the merger. You still own the same shares in
the same Fund as you did prior to the merger. Each of the new advisory
agreements contains substantially the same terms and conditions as the
agreement in effect prior to the merger, except for the dates of exe-
cution and termination. If shareholders do not approve the new advi-
sory agreements, the agreements will no longer continue and the gov-
erning Boards of your Fund will take such action as they deem to be in
the best interests of the Fund, and their respective shareholders.
Q. Have the investment advisory fees remained the same?
A. Yes.
<PAGE>
Q. What are the benefits of the merger?
A. There are several potential positive aspects of the merger you may be
interested in. Most notably, the combined institution will be one of
the largest financial institutions in the world, as well as a leader
in a number of important categories, including asset management. The
financial strength of the combined institution coupled with the in-
creased breadth and depth of its resources and capabilities are advan-
tages the acquisition brings. Further, as a truly global institution,
the combined entity will be in a unique position to provide coverage,
services and products.
Q. How does the Board of Trustees of my BT Mutual Fund recommend that I
vote?
A. After careful consideration, the Board of Trustees of your BT Mutual
Fund recommends that you vote in favor of all the proposals on the en-
closed proxy card(s).
Q. Whom do I call for more information?
A. If you need more information, please call Shareholder Communications
Corporation, your Fund's information agent, at 1-800-732-6168.
Q. How can I vote my shares?
A. You may choose from one of the following options to vote your shares:
. By mail, with the enclosed proxy card(s) and return envelope.
. By telephone, with a toll-free call to the telephone number that
appears on your proxy card.
. Through the Internet, by using the Internet address located on
your proxy card and following the instructions on the site.
. In person at the shareholder meeting (see details enclosed in
proxy statement).
Q. Will my BT Mutual Fund pay for the proxy solicitation and legal costs
associated with this transaction?
A. No, Bankers Trust will bear these costs.
Q. What happens if I own shares in more than one BT Mutual Fund?
A. If you have more than one BT Mutual Fund in your name at the same ad-
dress, you will receive separate proxy cards for each Fund but only
one proxy statement for the account.
Please vote all issues on each proxy card that you receive. Thank you for
mailing your proxy card(s) promptly.
2
<PAGE>
BT PYRAMID MUTUAL FUNDS
BT Investment Equity Appreciation Fund ("Equity Appreciation Fund")
.Investment Class
.Service Class
BT Investment Money Market Fund ("Money Market Fund")
BT Investment Equity 500 Index Fund ("Equity 500 Fund")
BT PreservationPlus Fund ("PreservationPlus Fund")
.Investment Class
.Institutional Class
.Institutional Service Class
.Service Class
One South Street
Baltimore, Maryland 21202
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held October 8, 1999
A Special Meeting of shareholders of BT Pyramid Mutual Funds (the "Trust")
will be held at the offices of BT Alex. Brown Incorporated, One South Street,
30th Floor, Baltimore, Maryland 21202 on October 8, 1999 at 11:00 a.m. (the
"Special Meeting"). The Trust is an open-end management investment company, or-
ganized under the laws of the Commonwealth of Massachusetts, that is comprised
of the above four series (each a "Fund," and collectively, the "Funds") and BT
Institutional Asset Management Fund, which is not addressed in the accompanying
Joint Proxy Statement ("Proxy Statement"). Each of the Money Market Fund, Eq-
uity 500 Fund and PreservationPlus Fund (the "Feeder Funds") operates as a
feeder fund in a master-feeder fund arrangement with a corresponding master
fund portfolio (each a "Portfolio," and collectively, the "Portfolios"). Each
Feeder Fund seeks to achieve its respective investment objectives by investing
all of its investable assets in a corresponding Portfolio with the same invest-
ment objective and policies. The Portfolio in which the PreservationPlus Fund
invests is organized as a separate series of BT Investment Portfolios, an open-
end management investment company, and the Portfolios in which the Money Market
Fund and Equity 500 Fund invest are organized as separately registered open-end
management investment companies, in each case established as a trust under the
laws of the State of New York. Pursuant to the requirements of the Investment
Company Act of 1940, as amended, applicable to master-feeder arrangements, each
Feeder Fund's voting rights with respect to the Portfolio interests that it
holds must be passed through to the Fund's own shareholders.
The Equity Appreciation Fund is not part of a master-feeder arrangement
and, as such, makes direct investments in securities rather than through a
<PAGE>
Portfolio. Throughout the Proxy Statement, for shareholders of the Equity
Appreciation Fund references to the Trustees of the Trust and the Portfolio
should be read as a reference to the Trustees of the Trust, references to the
Boards should be read as a reference to the Board of the Trust and references
to agreements of a Portfolio should be read as references to an agreement in
respect of this Fund.
The PreservationPlus Fund is comprised of four separate classes and the Eq-
uity Appreciation Fund is comprised of two separate classes, each with its own
expense structure. However, since the Proposals presented in the Proxy State-
ment uniformly affect all classes, shareholders of each class may vote on all
the proposals, and each vote regardless of its class has equal weight.
The Special Meeting is being held to consider and vote on the following
matters for each Fund, as indicated below and more fully described under the
corresponding Proposals in the Proxy Statement, and such other matters as may
properly come before the meeting or any adjournments thereof:
PROPOSAL I: (Proposal IA: To approve or disapprove new investment advisory
All Funds Proposals IB and agreements (each a "New Advisory Agreement" and
IC: Equity Appreciation collectively the "New Advisory Agreements") for
Fund and PreservationPlus each Fund's corresponding Portfolio:
Fund ONLY)
A. To approve or disapprove a New Advisory
Agreement between each Fund's corresponding
Portfolio and Bankers Trust Company ("Bankers
Trust").
B. To approve or disapprove a New Advisory
Agreement between each Fund's corresponding
Portfolio and Morgan Grenfell Inc. ("MGI" and,
together with Bankers Trust, the "Advisers") to
be implemented within two years of the date of
the Special Meeting upon approval of the members
of the Trust's and the Portfolio's Boards of
Trustees, respectively, who are not "interested
persons" ("Independent Trustees") (as defined in
the Investment Company Act of 1940, as amended).
C. To approve or disapprove a new sub-
investment advisory agreement (the "New Sub-
advisory Agreements," which term, unless
otherwise specified, is included within the
meaning of New Advisory Agreements) among each
Fund's corresponding Portfolio, MGI and Bankers
Trust under which Bankers Trust may perform
certain of
2
<PAGE>
MGI's responsibilities, at MGI's expense, under
the applicable New MGI Advisory Agreement with
the applicable Portfolio upon approval of the
Independent Trustees of the Trust and the
Portfolio.
PROPOSAL II:(All Funds) To elect Trustees of the Trust and the Portfolios
to hold office until their respective successors
have been duly elected and qualified or until
their earlier resignation or removal.
PROPOSAL III:(Money Market To ratify or reject the selection of
Fund, Equity 500 Fund and PricewaterhouseCoopers LLP as the independent
Equity Appreciation Fund accountants for Money Market Fund, Equity 500
ONLY) Fund and Equity Appreciation Fund and their
corresponding Portfolios for the current fiscal
year.
PROPOSAL IV: To ratify or reject the selection of Ernst &
(PreservationPlus Fund Young LLP as the independent accountants for
ONLY) PreservationPlus Fund and its corresponding
Portfolio for the current fiscal year.
The appointed proxies will vote in their discretion on any other business
as may properly come before the Special Meeting or any adjournment thereof.
The New Advisory Agreements described in Proposals IA, IB and IC, respec-
tively, will contain substantially the same terms and conditions, except for
the parties and the dates of execution, effectiveness and initial term, as the
prior investment advisory agreements pursuant to which services were provided
to the Portfolios. In addition, the form of New Sub-advisory Agreement autho-
rizes the applicable investment adviser to adjust the duties, the amount of as-
sets to be managed and the fees paid to the investment subadviser with and upon
the approval of the Board and the Independent Trustees of each Board. (The
Money Market Fund and Equity 500 Fund are not being asked to vote on Proposals
IB and IC.) As more fully discussed in the accompanying Proxy Statement, ap-
proval of the New Advisory Agreements, which provide for the same services to
be provided at the same fees, is generally occasioned by the merger of Circle
Acquisition Corporation, a wholly-owned subsidiary of Deutsche Bank A.G.
("Deutsche Bank"), with and into Bankers Trust Corporation, the parent company
of Bankers Trust. MGI is, and as a result of this transaction, Bankers Trust
became, an indirect wholly owned subsidiary of Deutsche Bank. The New Advisory
Agreements with MGI described in Proposal IB and the New Sub-advisory Agree-
ments with Bankers Trust described in Proposal IC will permit Deutsche Bank,
upon the approval of the Independent Trustees of the Trust and the Portfolios,
to simplify the organizational
3
<PAGE>
structure of its U.S. mutual fund operations, enhance the efficiency of their
administration and promote consistency of internal controls, compliance and
regulatory oversight. The deferral in implementing the New Advisory Agreements
with MGI is needed to permit Deutsche Bank a sufficient amount of time (which
will vary for different Portfolios) to plan, prepare and institute the neces-
sary arrangements for MGI to consolidate Deutsche Bank's U.S. mutual fund oper-
ations.
The close of business on July 22, 1999 has been fixed as the record date
for the determination of the shareholders of each Fund entitled to notice of,
and to vote at, the Special Meeting. You are cordially invited to attend the
Special Meeting.
IF YOU HAVE ANY QUESTIONS CONCERNING THE PROXY STATEMENT OR THE PROCEDURES
TO BE FOLLOWED TO EXECUTE AND DELIVER A PROXY, PLEASE CONTACT SHAREHOLDER COM-
MUNICATIONS CORPORATION AT 1-800-732-6168.
This notice and related proxy material are first being mailed to sharehold-
ers on or about August 23, 1999. This proxy is being solicited on behalf of the
Board of Trustees of the Trust.
By Order of the Board of Trustees,
/s/ Daniel O. Hirsch
Daniel O. Hirsch, Secretary
New York, New York
August 23, 1999
WHETHER OR NOT YOU EXPECT TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN THE
ENCLOSED ENVELOPE IN ORDER TO ASSURE REPRESENTATION OF YOUR SHARES (UN-
LESS YOU ARE VOTING BY TELEPHONE OR THROUGH THE INTERNET). NO POSTAGE
NEED BE AFFIXED IF THE PROXY CARD IS MAILED IN THE UNITED STATES.
4
<PAGE>
BT Pyramid Mutual Funds
BT Investment Equity Appreciation Fund ("Equity Appreciation Fund")
.Investment Class
.Service Class
BT Investment Money Market Fund ("Money Market Fund")
BT Investment Equity 500 Index Fund ("Equity 500 Fund")
BT PreservationPlus Fund ("PreservationPlus Fund")
.Investment Class
.Institutional Class
.Institutional Service Class
.Service Class
One South Street
Baltimore, Maryland 21202
PROXY STATEMENT FOR THE SPECIAL MEETING
OF SHAREHOLDERS
October 8, 1999
This Joint Proxy Statement ("Proxy Statement") is being furnished in con-
nection with the solicitation of proxies by the Board of Trustees of BT Pyramid
Mutual Funds (the "Trust") with respect to the above four series thereof (each
a "Fund," and collectively, the "Funds") for use at the special meeting of the
Trust to be held at the offices of BT Alex. Brown, One South Street, 30th
Floor, Baltimore, Maryland 21202 on October 8, 1999 at 11:00 a.m. (the "Special
Meeting") and at any adjournments thereof. This Proxy Statement and accompany-
ing proxy card(s) ("Proxy") are expected to be mailed to shareholders on or
about August 23, 1999.
Each of the Money Market Fund, Equity 500 Fund and PreservationPlus Fund
(the "Feeder Funds") operates as a feeder fund in a master-feeder fund arrange-
ment with a corresponding master fund portfolio (each a "Portfolio," and col-
lectively, the "Portfolios"). The Portfolio in which the BT PreservationPlus
Fund invests is organized as a separate series of BT Investment Portfolios ("BT
Portfolios"), an open-end management investment company, and the Portfolios in
which the Money Market Fund and Equity 500 Fund invest are organized as sepa-
rately registered open-end management investment companies, in each case estab-
lished as a trust under the laws of the State of New York. Each Feeder Fund
seeks to achieve its respective investment objectives by investing all of its
investable assets in a corresponding Portfolio with the same investment objec-
tives and policies.
The Equity Appreciation Fund is not part of a master-feeder arrangement
and, as such, makes direct investments in securities rather than through a
Portfolio. Throughout this Proxy Statement, for shareholders of the Equity
Apprecia-
<PAGE>
tion Fund references to the Trustees of the Trust and the Portfolio should be
read as a reference to the Trustees of the Trust, references to the Boards
should be read as a reference to the Board of the Trust and references to
agreements of a Portfolio should be read as references to an agreement in re-
spect of this Fund.
For simplicity, actions are described in this Proxy Statement as being
taken by a Fund, which is a series of the Trust, although all actions are actu-
ally taken by the Trust on behalf of the applicable series or Fund. Some ac-
tions described as taken by or with respect to a Fund are actually actions to
be taken by the corresponding Portfolio in which the Fund invests all of its
assets and on which the Fund votes as a shareholder. Further, actions described
as being taken by the shareholders of the Trust with respect to its Board of
Trustees will also be taken by the Funds as shareholders of the Portfolios with
respect to the Portfolios' respective Boards of Trustees. Your vote and the
vote of other shareholders of the relevant Fund determines how the Fund will
vote with respect to itself and its corresponding Portfolio. See "Background."
The PreservationPlus Fund is comprised of four separate classes and the Eq-
uity Appreciation Fund is comprised of two separate classes, each with its own
expense structure. However, since the proposals presented in this Proxy State-
ment uniformly affect all classes, shareholders of each class may vote on all
the proposals, and each vote regardless of its class has equal weight.
The Special Meeting is being held to consider and vote on the following
matters for each Fund, as indicated below and described more fully under the
corresponding Proposals discussed herein, and such other matters as may prop-
erly come before the meeting or any adjournments thereof:
PROPOSAL I: (Proposal IA: To approve or disapprove new investment advisory
All Funds Proposals IB and agreements (each a "New Advisory Agreement" and
IC: Equity Appreciation collectively the "New Advisory Agreements") for
Fund and PreservationPlus each Fund's corresponding Portfolio:
Fund ONLY)
A. To approve or disapprove a New Advisory
Agreement between each Fund's corresponding Port-
folio and Bankers Trust Company ("Bankers Trust")
(the "New BT Advisory Agreements").
B. To approve or disapprove a New Advisory
Agreement between each Fund's corresponding Port-
folio and Morgan Grenfell Inc. ("MGI," and, to-
gether with Bankers Trust, the "Advisers") (the
"New MGI Advisory Agreements") to be implemented
within two years of the date of the Special Meet-
ing upon approval of the members of the Trust's
and the Portfolios' Boards of Trustees, re-
2
<PAGE>
spectively, who are not "interested persons"
thereof ("Independent Trustees") (as defined in
the Investment Company Act of 1940, as amended
(the "Act")).
C. To approve or disapprove a new sub-invest-
ment advisory agreement (the "New Sub-advisory
Agreements," which term, unless otherwise speci-
fied, is included within the meaning of New Advi-
sory Agreements) among each Fund's corresponding
Portfolio, MGI and Bankers Trust under which
Bankers Trust may perform certain of MGI's re-
sponsibilities, at MGI's expense, under the ap-
plicable New MGI Advisory Agreement with the ap-
plicable Portfolio upon approval of the Indepen-
dent Trustees of the Trust and the Portfolios.
PROPOSAL II: To elect Trustees of the Trust and the Portfolios
- ----------- to hold office until their respective successors
(All Funds) have been duly elected and qualified or until
their earlier resignation or removal.
PROPOSAL III: To ratify or reject the selection of
- ------------ PricewaterhouseCoopers LLP as the independent ac-
(Money Market Fund, countants for the Money Market Fund, Equity 500
Equity 500 Fund Fund and Equity Appreciation Fund and their cor-
and Equity Appreciation responding Portfolios for the current fiscal
Fund ONLY) year.
PROPOSAL IV: To ratify or reject the selection of Ernst &
- ----------- Young LLP as the independent accountants for the
(PreservationPlus Fund PreservationPlus Fund and its corresponding Port-
ONLY) folio for the current fiscal year.
The appointed proxies will vote on any other business as may properly come
before the Special Meeting or any adjournment thereof.
3
<PAGE>
The Funds' shareholders are to consider the approval of new investment ad-
visory agreements as indicated in the table below:
<TABLE>
<CAPTION>
Fund Corresponding Portfolio
------------------------------------------------------------------------
<S> <C>
Equity
Appreciation
Fund N/A
------------------------------------------------------------------------
Money Market Fund Cash Management Portfolio ("Cash Portfolio")*
------------------------------------------------------------------------
Equity 500 Fund Equity 500 Index Portfolio ("Equity 500 Portfolio")*
------------------------------------------------------------------------
PreservationPlus BT PreservationPlus Portfolio ("PreservationPlus
Fund Portfolio")**
</TABLE>
* A separately registered open-end management company organized as a trust un-
der the laws of the State of New York.
** A separate series of BT Portfolios.
The shareholders of the Trust are also to consider the election of Charles
P. Biggar, S. Leland Dill, Martin J. Gruber, Richard Hale, Richard J. Herring,
Bruce E. Langton, Philip Saunders, Jr. and Harry Van Benschoten (the "Trustee
Nominees") as Trustees of the Trust and Portfolios./1/ Dr. Gruber and Mr. Van
Benschoten currently serve on the Board of the Trust and Messrs. Biggar, Dill
and Saunders currently serve on the Board of the Portfolios (collectively, the
"Boards"). Drs. Gruber and Herring and Messrs. Biggar, Dill, Langton and Van
Benschoten currently serve as Trustees of various other investment companies
within the Bankers Trust family of funds. To ensure adherence by the Trust and
the Portfolios to Section 15(f) of the Act, only Mr. Hale will be an "inter-
ested person" (within the meaning of Section 2(a)(19) of the Act) of the Funds
or Portfolios following the Merger (as defined herein) and the approval of the
New Advisory Agreements.
Notice of the Special Meeting and a Proxy accompany this Proxy Statement.
Proxy solicitations will be made primarily by mail, but solicitations may also
be made by telephone, telegraph, through the Internet or in person by officers
or agents of the Funds. All costs of solicitation, including (a) printing and
mailing of this Proxy Statement and accompanying material, (b) the reimburse-
ment of brokerage firms and others for their expenses in forwarding solicita-
tion material to the beneficial owners of the Funds' shares, (c) payment to
Shareholder Communications Corporation for its services in soliciting proxies
and (d) supplementary solicitations to submit Proxies, will be borne by Bankers
Trust. If the Funds record votes by telephone or through the Internet, they
will use procedures designed to authenticate shareholders' identities, to allow
shareholders to authorize the voting of their shares in accordance with their
instructions, and to confirm that their instructions have been properly record-
ed. Proxies voted by telephone or through the Internet may be revoked at any
time before they are voted in the same manner that proxies voted by mail may be
revoked.
- -----------
(1) Unless otherwise indicated, references in this Proxy Statement to the
"Trustee Nominees" includes the Trustee Nominees of both the Trust and the
Portfolios.
4
<PAGE>
The Annual Report of each Fund containing audited financial statements for
the fiscal year ended September 30, 1998 (for the PreservationPlus Fund) and
December 31, 1998 (for the Money Market Fund and Equity 500 Fund), as well as
the Semi-Annual Report of each Fund (each a "Report"), have previously been
furnished to the Funds' respective shareholders. An additional copy of each
Report will be furnished without charge upon request by writing to the Trust
at the address set forth on the cover of this Proxy Statement or by calling 1-
800-368-4031.
If the enclosed Proxy is properly executed and returned in time to be
voted at the Special Meeting, the shares represented thereby will be voted in
accordance with the instructions marked on the Proxy. Shares of a Fund are en-
titled to one vote each at the Special Meeting and fractional shares are enti-
tled to proportionate shares of one vote. If no instructions are marked on the
Proxy with respect to a specific Proposal, the Proxy will be voted "FOR" the
approval of such Proposal and in accordance with the judgment of the persons
appointed as proxies with respect to any other matter that may properly come
before the Special Meeting. Any shareholder giving a Proxy has the right to
attend the Special Meeting to vote his/her shares in person (thereby revoking
any prior Proxy) and also the right to revoke the Proxy at any time by written
notice received by the applicable Fund prior to the time it is voted.
Bankers Trust will vote any shares in accounts as to which it has invest-
ment authority, and shares in any other accounts as to which Bankers Trust is
the agent of record, which are not otherwise represented in person or by proxy
at the Special Meeting. Bankers Trust will vote shares of each Fund over which
it has investment discretion in accord with its fiduciary and other legal ob-
ligations, and in its discretion may consult with the beneficial owners or
other fiduciaries. Bankers Trust will vote shares of each Fund for which it is
the owner of record but does not have investment discretion, with respect to
each Proposal on which shareholders of the applicable Fund are entitled to
vote, which are not otherwise represented in person or by proxy at the Special
Meeting. These shares will be voted by Bankers Trust for, against, or ab-
staining, in the same proportion as the votes cast by holders of all shares in
the Fund otherwise represented at the Special Meeting. This practice is com-
monly referred to as "mirror" or "echo" voting.
In the event that a quorum is not present at the Special Meeting, or if a
quorum is present but sufficient votes to approve a Proposal are not received,
the persons named as proxies may propose one or more adjournments of the Spe-
cial Meeting to permit further solicitation of Proxies with respect to the
Proposal. In determining whether to adjourn the Special Meeting, the following
factors may be considered: the nature of the proposals that are the subject of
the Special Meeting, the percentage of votes actually cast, the percentage of
negative votes actually cast, the nature of any further solicitation and the
information to be provided to shareholders with respect to the reasons for the
solicitation. Any
5
<PAGE>
adjournment will require the affirmative vote of a majority of those shares
represented at the Special Meeting in person or by Proxy. The persons named as
proxies will vote those Proxies that they are entitled to vote "FOR" any Pro-
posal in favor of an adjournment and will vote those Proxies required to be
voted "AGAINST" any such Proposal against any adjournment. A shareholder vote
may be taken on one or more of the Proposals in the Proxy Statement prior to
any adjournment if sufficient votes have been received and it is otherwise ap-
propriate. A quorum of shareholders is constituted by the presence in person
or by proxy of the holders of a majority of the outstanding shares of the
Trust or a Fund thereof (as applicable) entitled to vote at the Special Meet-
ing. For purposes of determining the presence of a quorum for transacting
business at the Special Meeting, abstentions and broker "non-votes" (that is,
proxies from brokers or nominees indicating that these persons have not re-
ceived instructions from the beneficial owner or other persons entitled to
vote shares on a particular matter with respect to which the brokers or nomi-
nees do not have discretionary power) will be treated as shares that are pres-
ent but which have not been voted. (See "Vote Required" for a further discus-
sion of abstentions and broker non-votes.)
Shareholders of record at the close of business on July 22, 1999 (the
"Record Date") are entitled to notice of, and to vote at, the Special Meeting.
As of the Record Date, the following number of shares of each Fund were issued
and outstanding:
<TABLE>
<S> <C>
Equity Appreciation Fund 8,477,424.987 shares
Money Market Fund 609,097,575.050 shares
Equity 500 Fund 5,368,831.896 shares
PreservationPlus Fund 33,478,701.089 shares
</TABLE>
This Proxy Statement is being used in order to reduce the preparation,
printing, handling and postage expenses that would result from the use of a
separate statement for each Fund and, because shareholders may own shares of
more than one Fund, the combined statement may avoid burdening shareholders
with more than one proxy statement. To the extent information relating to com-
mon ownership is available to the Funds, a shareholder that owns of record
shares in two or more of the Funds will receive a package containing a Proxy
Statement and Proxies for the Funds in which such shareholder is a record own-
er. If the information relating to common ownership is not available to the
Funds, a shareholder that beneficially owns of record shares in two or more
Funds may receive two or more packages each containing a Proxy Statement and a
Proxy for each Fund in which the shareholder is a beneficial owner. It is es-
sential that shareholders complete, date, sign and return each enclosed Proxy,
unless a shareholder is voting by telephone or through the Internet.
6
<PAGE>
In order that your shares may be represented, you are requested to, unless
you are voting by telephone or through the Internet :
. indicate your instructions on the Proxy (or Proxies);
. date and sign the Proxy (or Proxies); and
. mail the Proxy (or Proxies) promptly in the enclosed envelope.
Beneficial Ownership of Shares of the Funds
Annex I attached hereto sets forth information as of the Record Date re-
garding the beneficial ownership of the Funds' shares by (i) the only persons
known by each Fund to beneficially own more than five percent of the outstand-
ing shares of the Fund, (ii) the Trustees and Trustee Nominees, (iii) the ex-
ecutive officers of each Fund, and (iv) the Trustees and executive officers of
each Fund as a group. The number of shares beneficially owned by each Trustee,
Trustee Nominee or executive officer is determined under rules of the Securi-
ties and Exchange Commission (the "Commission"), and the information is not
necessarily indicative of beneficial ownership for any other purpose. Under
these rules, beneficial ownership includes any shares as to which the individ-
ual has the sole or shared voting power or investment power and also any
shares which the individual has the right to acquire within 60 days of the
Record Date through the exercise of any stock option or other right. Unless
otherwise indicated, each person has sole investment and voting power (or
shares this power with his or her spouse) with respect to the shares set forth
in Annex I. The inclusion herein of any shares deemed beneficially owned does
not constitute an admission of beneficial ownership of the shares.
Collectively, the Trustees and officers of the Trust own less than 1% of
each Fund's outstanding shares.
Background
Master-Feeder Structure. Shareholders of the Funds are being asked to ap-
prove the New Advisory Agreements, as applicable, and to elect new Boards of
Trustees of the Trust and the Portfolios. As indicated earlier, each Fund (ex-
cept for Equity Appreciation Fund) operates as a feeder fund in a master-
feeder fund arrangement with the Portfolios, which serve as master funds. As
feeder funds, the Funds seek to achieve their respective investment objectives
by investing all of their investable assets in a corresponding Portfolio with
the same investment objectives and policies. The Portfolios invest directly in
investment securities and other investments. Pursuant to the requirements of
the Act applicable to master-feeder arrangements, each Fund's voting rights
with respect to the Portfolio shares that it holds must be passed through to
the Fund's own shareholders. Other feeder funds of a particular Portfolio will
also vote in accordance with their respective charters and/or other applicable
requirements with respect to the approval of the applicable New Advisory
Agreement(s), the election of Trustees of the Portfolios and the ratification
of the Portfolios' independent accountants.
7
<PAGE>
The Portfolios. As indicated earlier, the PreservationPlus Portfolio is a
separate series of BT Portfolios, while the Cash Portfolio and Equity 500
Portfolio are separately registered open-end management investment companies.
Bankers Trust, a banking corporation organized under the laws of the State of
New York, located at 130 Liberty Street (One Bankers Trust Plaza), New York,
New York 10006, serves as the investment adviser, custodian and administrator
of each Portfolio. Bankers Trust is a wholly owned subsidiary of Bankers Trust
Corporation ("BT Corporation"), located at 130 Liberty Street (One Bankers
Trust Plaza), New York, New York 10006, a registered bank holding company or-
ganized under the laws of the State of New York. As discussed later in this
Proxy Statement, as a result of the Merger (as defined herein), BT Corporation
became a wholly owned subsidiary of Deutsche Bank A.G. ("Deutsche Bank"), lo-
cated at 31 West 52nd Street, New York, New York 10019. ICC Distributors,
Inc., located at Two Portland Square, Portland, Maine 04101, serves as the
principal underwriter of each Portfolio. ICC Distributors, Inc. is not affili-
ated with Bankers Trust, Deutsche Bank or any of their affiliates.
8
<PAGE>
PROPOSALS IA, IB AND IC
APPROVAL OF NEW ADVISORY AGREEMENTS
The New Advisory Agreements will contain substantially the same terms and
conditions, except for the parties and the dates of execution, effectiveness
and initial term, as the prior investment advisory agreements pursuant to
which services were provided to the Portfolios. In addition, the form of New
Sub-advisory Agreement authorizes the applicable investment adviser to adjust
the duties, the amount of assets to be managed and the fees paid to the in-
vestment subadviser with and upon the approval of the Board and the Indepen-
dent Trustees of each Board. As more fully discussed below, approval of the
New Advisory Agreements, which provide for the same services to be provided at
the same fees, is generally occasioned by the Merger (as defined herein) pur-
suant to which Bankers Trust became an indirect subsidiary of Deutsche Bank.
The New MGI Advisory Agreements described in Proposal IB and the New Sub-advi-
sory Agreements with Bankers Trust described in Proposal IC (which are not
proposed for approval by shareholders of Money Market Fund or Equity 500 Fund)
will permit Deutsche Bank, upon the approval of the Independent Trustees of
the Trust and the applicable Portfolio, to simplify the organizational struc-
ture of its U.S. mutual fund operations, enhance the efficiency of their ad-
ministration and promote consistency of internal controls, compliance and reg-
ulatory oversight. The deferral in implementing the New MGI Advisory Agree-
ments is needed to permit Deutsche Bank a sufficient amount of time (which
will vary for different Portfolios) to plan, prepare and institute the neces-
sary arrangements for MGI to consolidate Deutsche Bank's U.S. mutual fund op-
erations.
The Prior Advisory Agreements
The Prior Advisory Agreements. Prior to June 4, 1999, Bankers Trust
served as investment adviser to each of the Portfolios (as discussed earlier)
pursuant to separate investment advisory agreements between Bankers Trust and
the applicable Portfolios (the "Prior Advisory Agreements"). The Prior Advi-
sory Agreements were initially approved by the Boards of the applicable Port-
folio and Trust, including a majority of the Independent Trustees of the Port-
folio or the Trust, respectively.
The following table lists: (i) the date of each Prior Advisory
Agreement;(ii) the most recent date on which each Prior Advisory Agreement was
approved by the applicable Portfolio's Trustees, including a majority of the
Independent Trustees, and shareholders; (iii) the most recent date on which
each Prior Advisory Agreement was approved by the applicable Fund's Trustees,
including a majority of the Independent Trustees, and shareholders; and (iv)
the amount paid by the Portfolios to Bankers Trust for services rendered pur-
suant to the Prior Advisory Agreements (for each Portfolio's last fiscal
year):
9
<PAGE>
<TABLE>
<CAPTION>
Date of
Prior Date Last Date Last
Portfolio Advisory Approved By Approved By
(Fiscal Year) Agreement Portfolio's Fund's Fee
- --------------------------------------------------------------------------------------
Trustees Shareholders* Trustees Shareholders*
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Equity
Appreciation
Fund
(9/30/98) 8/6/96 N/A N/A 3/8/99 8/6/96 $1,059,224
- --------------------------------------------------------------------------------------
Cash Portfolio
(12/31/98) 4/23/90 3/8/99 4/23/90 3/8/99 4/23/90 $8,019,093
- --------------------------------------------------------------------------------------
Equity 500
Portfolio
(12/31/98) 4/8/92 3/8/99 4/8/92 3/8/99 4/8/92 $3,186,503
- --------------------------------------------------------------------------------------
PreservationPlus
Portfolio
(9/30/98) 4/28/93 3/8/99 4/28/93 3/8/99 4/28/93 $435,257
</TABLE>
- -----------
*Shareholders voted to approve the Prior Advisory Agreements on their respec-
tive dates of inception.
The Merger. On November 30, 1998, BT Corporation, Deutsche Bank and Circle
Acquisition Corporation entered into an Agreement and Plan of Merger (the
"Merger Agreement"). Pursuant to the terms of the Merger Agreement, Circle Ac-
quisition Corporation, a wholly owned New York subsidiary of Deutsche Bank,
merged with and into BT Corporation on June 4, 1999, with BT Corporation con-
tinuing as the surviving entity (the "Merger"). Under the terms of the Merger,
each outstanding share of BT Corporation common stock was converted into the
right to receive $93 in cash, without interest. Since the Merger, BT Corpora-
tion, along with its affiliates, has continued to offer the range of financial
products and services, including investment advisory services, that it offered
prior to the Merger.
As a result of the Merger, BT Corporation became a wholly owned subsidiary
of Deutsche Bank. Deutsche Bank is a banking company with limited liability
organized under the laws of the Federal Republic of Germany. Deutsche Bank is
the parent company of a group consisting of banks, capital markets companies,
fund management companies, mortgage banks, a property finance company, in-
stallment financing and leasing companies, insurance companies, research and
consultancy companies and other domestic and foreign companies (the "Deutsche
Bank Group"). At March 31, 1999, the Deutsche Bank Group had total assets of
US $727 billion. The Deutsche Bank Group's capital and reserves at March 31,
1999 were US $19.6 billion.
Impact of the Merger on the Prior Advisory Agreements. Section 15(a) of
the Act provides, in pertinent part, that "[i]t shall be unlawful for any per-
son to serve or act as investment adviser of a registered investment company,
except pursuant
10
<PAGE>
to a written contract, which contract, whether with such registered company or
with an investment adviser of such registered company, has been approved by
the vote of a majority of the outstanding voting securities of such registered
company. . . ." Section 15(a)(4) of the Act further requires that such written
contract provide for automatic termination in the event of its assignment.
Section 2(a)(4) of the Act defines "assignment" to include any direct or indi-
rect transfer of a contract by the assignor.
While it may be argued otherwise, consummation of the Merger may have re-
sulted in an "assignment" of the Prior Advisory Agreements within the meaning
of the Act, terminating the agreements according to their respective terms and
the Act as of June 4, 1999. Specifically, as Bankers Trust is a wholly owned
subsidiary of BT Corporation, the merger of Circle Acquisition Corporation
with and into BT Corporation could be deemed to have resulted in an "assign-
ment" of the Prior Advisory Agreements with Bankers Trust.
On May 25, 1999, Bankers Trust was granted an exemptive order (the
"Exemptive Order") by the Commission permitting implementation, without ob-
taining prior shareholder approval, of the New BT Advisory Agreements during
an interim period commencing on the date of the closing of the Merger and con-
tinuing, for a period of up to 150 days, through the date on which each of the
New BT Advisory Agreements are approved or disapproved by the respective
shareholders of each Portfolio (the "Interim Period"). Under the terms of the
Exemptive Order, Bankers Trust was allowed to receive advisory fees during the
Interim Period pursuant to the New BT Advisory Agreements, provided that these
fees would be held in escrow pending shareholder approval of the New BT Advi-
sory Agreements. In accordance with the Exemptive Order, the advisory fees
charged to the Portfolios and paid to Bankers Trust under the New BT Advisory
Agreements have been held in an interest-bearing escrow account and the Port-
folios expect to continue to deposit these fees in such account until approval
of the New BT Advisory Agreements by the respective shareholders of the Port-
folios has been obtained. If the New BT Advisory Agreements are not approved
by the shareholders by the expiration of the Interim Period, the fees held in
escrow will be remitted to the applicable Fund. As of June 30, 1999, the
amount in escrow for Equity Appreciation Fund totaled $75,039.44, for Money
Market Fund totaled $59,131.66, for Equity 500 Fund totaled $69,830.45 and for
PreservationPlus Fund totaled $48,067.89.
The Funds, as shareholders of the Portfolios, are not being asked to ap-
prove or disapprove the Merger or the Merger Agreement; rather, they are being
asked under these Proposals to approve and continue the New BT Advisory Agree-
ments and to approve the New Advisory Agreements for the Portfolios. Other
than the parties and the dates of execution, effectiveness, and initial term
of the agreements, the New Advisory Agreements contain substantially the same
terms and conditions as the Prior Advisory Agreements. In addition, the form
of New Sub-advisory Agreement authorizes the applicable investment adviser to
11
<PAGE>
adjust the duties, the amount of assets to be managed and the fees paid to the
investment subadviser with and upon the approval of the Board and the Indepen-
dent Trustees. The advisory fee rates charged to the Portfolios under the Prior
Advisory Agreements have continued to apply under the New BT Advisory Agree-
ments and would continue to apply under the New MGI Advisory Agreements. MGI,
and not the Portfolios, would be solely responsible for paying the sub-advisory
fees, which may vary from time to time as approved by the Independent Trustees.
The sub-advisory fees would be paid by MGI directly to the subadviser. In addi-
tion, the Advisers have advised the Portfolios that they can expect to continue
to receive the same level and quality of services under the New Advisory Agree-
ments as they received under the Prior Advisory Agreements. The Advisers have
represented to the Boards that in the event of any material change in the in-
vestment management personnel of the Advisers responsible for providing serv-
ices to the Funds, the Advisers will apprise and consult with the relevant
Board or Boards to ensure that the applicable Board, including a majority of
the Board's Independent Trustees, is satisfied that the services provided by
the Advisers will not be diminished in scope and quality.
The New Advisory Agreements
The New Advisory Agreements. The form of the New Advisory and Sub- advisory
Agreement is attached to this Proxy Statement as Exhibit A. If shareholders ap-
prove the New Advisory Agreements, each of the agreements will remain in effect
for an initial term of two years from its effective date, and may be renewed
annually thereafter by specific approval of the respective Board or sharehold-
ers of the applicable Portfolio, provided that they are also approved by a ma-
jority of the Independent Trustees. The terms and conditions of the New Advi-
sory Agreements, other than the parties and their dates of execution, effec-
tiveness and initial term, are substantially the same as those of the Prior Ad-
visory Agreements. The New BT Advisory Agreements and the New MGI Advisory
Agreements will be between the Trust and either Bankers Trust or MGI, as appli-
cable; the New Sub-advisory Agreements will be among the Trust, MGI (as Advis-
er) and Bankers Trust (as sub-adviser). Each of the New BT Advisory Agreements
became effective as of June 4, 1999, the date of the consummation of the Merg-
er.
If the New MGI Advisory Agreements and/or the New Sub-advisory Agreements
are approved, Bankers Trust will continue to perform its advisory duties under
the New BT Advisory Agreements until the New MGI Advisory Agreements and/or the
New Sub-advisory Agreements are implemented. MGI, as Adviser, and Bankers
Trust, as subadviser, would perform its respective advisory duties and be paid
its respective advisory fees only upon implementation of the applicable New Ad-
visory Agreement.
Under the terms of the New Advisory Agreements, as under the Prior Advisory
Agreements, each of the Advisers agrees to furnish the Portfolios with invest
12
<PAGE>
ment advisory and other services in connection with a continuous investment
program for the Portfolios, including investment research and management with
respect to all securities, investments, cash and cash equivalents in the port-
folios. Subject to the supervision and control of the Portfolios' Boards, each
of the Advisers agrees to (a) conform to all applicable rules and regulations
of the Commission, including all applicable provisions of the Securities Act
of 1933, as amended (the "1933 Act"), the Securities Exchange Act of 1934 (the
"Exchange Act"), the Act and the Investment Advisers Act of 1940, as amended
(the "Advisers Act"), and will conduct its activities under the New Advisory
Agreements in accordance with applicable regulations of the Board of Governors
of the Federal Reserve System pertaining to the investment advisory activities
of bank holding companies and their subsidiaries, (b) provide the services
rendered by it in accordance with the applicable Portfolio's investment objec-
tives and policies as stated in Prospectuses and Statements of Additional In-
formation of the relevant Funds, as from time to time in effect, and the Port-
folios' then current registration statements on Form N-1A as filed with the
Commission and the then current offering Memorandum if the Portfolio is not
registered under the 1933 Act, (c) place orders pursuant to its investment de-
terminations for each Portfolio either directly with the issuer or with any
broker or dealer selected by it, (d) determine from time to time what securi-
ties or other investments will be purchased, sold or retained by each Portfo-
lio, and (e) maintain books and records with respect to the securities trans-
actions of each Portfolio and render to the Board of Trustees of the Trust
such periodic and special reports as they may request.
The Advisory Fees. The investment advisory fee rate charged to the Portfo-
lios under the New BT Advisory Agreements and the New MGI Advisory Agreements
is the same as the investment advisory fee rate charged under the Prior Advi-
sory Agreements. As noted above, the investment advisory fee payable under the
New Sub-advisory Agreements would be paid by MGI, not the Portfolios, and may
vary from time to time, subject to the approval of the applicable Portfolio's
Board of Trustees, including a majority of its Independent Trustees.
As under the Prior Advisory Agreements, Bankers Trust or MGI, as applica-
ble, is paid a fee under the New Advisory Agreements for its services, calcu-
lated daily and paid monthly, equal, on an annual basis, to the following:
<TABLE>
<CAPTION>
Portfolio Advisory Agreement Fee*
- ---------------------------------------------------
<S> <C>
Equity Appreciation Fund 0.65%
Cash Portfolio 0.15%
Equity 500 Portfolio 0.085%**
PreservationPlus Portfolio 0.35%
</TABLE>
- -----------
* Pursuant to the Expense Limitation Agreement between Bankers Trust and the
Trust, the total fund operating expenses for each Fund (except for
PreservationPlus Fund) are capped for the current fiscal year. Bankers
Trust has voluntarily waived a portion of the fees payable to it with re-
spect to the PreservationPlus Fund. The fee rates shown do not reflect the
cap.
** This represents the actual fee paid to Bankers Trust over the last fiscal
year. The fee was reduced to 0.075% on May 6, 1998.
13
<PAGE>
Generally. If approved, the New Advisory Agreements, as applicable, will
each remain in effect for an initial term of two years (unless sooner terminat-
ed), and shall remain in effect from year to year thereafter if approved annu-
ally (1) by the Portfolios' Boards or by the holders of a majority of the Port-
folios' respective outstanding voting securities (i.e., in most cases, the
Funds) and (2) by a majority of the Independent Trustees who are not parties to
such contract or agreement. Like the Prior Advisory Agreements, the New Advi-
sory Agreements will terminate upon assignment by any party and are terminable,
without penalty, on 60 days' written notice by the Portfolios' Boards or by a
"majority" vote of the shareholders of the Portfolios (as defined in the Act)
or upon 60 days' written notice by the applicable Adviser.
The services of the Advisers are not deemed to be exclusive and nothing in
the New Advisory Agreements prevents them or their affiliates from providing
similar services to other investment companies and other clients (whether or
not their investment objectives and policies are similar to those of the Port-
folios) or from engaging in other activities. In addition, the Advisers are ob-
ligated to pay expenses associated with providing the services contemplated by
the New Advisory Agreements. The Portfolios bear certain other expenses includ-
ing the fees of the Portfolios' Boards. The Portfolios also pay any extraordi-
nary expenses incurred.
Under the New Advisory Agreements, each of the Advisers will exercise its
best judgment in rendering its advisory services. The Advisers shall not be li-
able for any error of judgment or mistake of law or for any loss suffered by
the Portfolios in connection with the matters to which the New Advisory Agree-
ments relate, provided that nothing therein shall be deemed to protect or pur-
port to protect the Advisers against any liability to the Portfolios or to its
shareholders to which the Advisers could otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence on their part in the perfor-
mance of their duties or by reason of the Advisers' reckless disregard of their
obligations and duties under the New Advisory Agreements.
The Advisers
Bankers Trust. Bankers Trust is the principal banking subsidiary of BT Cor-
poration. Bankers Trust is a bank and, therefore, not required to register as
an investment adviser under the Advisers Act. Bankers Trust provides a broad
range of commercial banking and financial services, including originating loans
and other forms of credit, accepting deposits and arranging financings. Bankers
Trust also engages in trading currencies, securities, derivatives and commodi-
ties. In addition to providing investment advisory services to the Portfolios,
Bankers Trust serves as investment adviser to 31 other investment companies and
as investment subadviser to 34 other investment companies. (See Annex II for a
list of those investment companies that Bankers Trust advises that have invest-
ment objectives
14
<PAGE>
similar to those of the Portfolios, together with information regarding the
fees charged to those companies.) As of March 31, 1999, Bankers Trust had over
$313 billion of assets under management, including $1.8 billion of assets in
the Portfolios.
The names, business addresses and principal occupations of the current di-
rectors and chief executive officer of Bankers Trust are set forth below.
<TABLE>
<CAPTION>
Name and Address Principal Occupation
- -------------------------------------------------------------------------------
<C> <S>
Josef Ackermann Chairman of the Board, Chief Executive Officer and
Deutsche Bank A.G. President, Bankers Trust Company; Member, Board of
Taunusanlage 12 Managing Directors, Deutsche Bank A.G.
D-60262 Frankfurt am Main
Federal Republic of Germany
Hans Angermueller Shearman & Sterling, of counsel
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
George B. Beitzel Director, Computer Task Group, Inc.; Director,
29 King Street Phillips Petroleum Company; Director, TIG Holdings
Chappaqua, NY 10514-3432 Inc.
William R. Howell Chairman Emeritus, J.C. Penney Company, Inc.;
J.C. Penney Company, Inc. Director, Exxon Corporation; Director, Halliburton
P.O. Box 10001 Company; Director, National Organization on
Dallas, TX 75301-1109 Disability; Director, National Retail Federation;
Director and Chairman, Southern Methodist
University Board of Trustees; Director, Warner-
Lambert Company; Director, The Williams Companies,
Inc.
Hermann-Josef Lamberti Member, Board of Managing Directors; Deutsche Bank
Deutsche Bank A.G. A.G.
Taunusanlage 12
D-60262 Frankfurt am Main
Federal Republic of Germany
John A. Ross Regional Chief Executive Officer, Deutsche Bank
Deutsche Bank A.G. Americas Holding Corp.
31 West 52nd Street
New York, NY 10019
Ronaldo H. Schmitz Member, Board of Managing Directors, Deutsche Bank
Deutsche Bank A.G. A.G.
Taunusanlage 12
D-60262 Frankfurt am Main
Federal Republic of Germany
- -------------------------------------------------------------------------------
</TABLE>
In addition to serving as investment adviser to the Portfolios, Bankers
Trust also serves as administrator, transfer agent and custodian of each Port-
folio and Fund. These services will continue to be provided by Bankers Trust
after approval
15
<PAGE>
of the New Advisory Agreements. (Annex III sets forth the fees paid to Bankers
Trust by the Portfolios and the Funds for these services for the most recently
completed fiscal year.)
MGI. MGI is a corporation organized under the laws of the State of Dela-
ware and is a registered investment adviser under the Advisers Act. It is lo-
cated at 885 Third Avenue, 32nd Floor, New York, NY 10022. MGI provides a full
range of investment advisory services to institutional clients. MGI serves as
investment adviser to ten other investment companies and as investment
subadviser to five other investment companies. MGI is a subsidiary of Morgan
Grenfell Asset Management Ltd. ("MGAM"), located at 20 Finsbury Circus, Lon-
don, England, a wholly owned subsidiary of Deutsche Morgan Grenfell Group PLC,
located at 23 Great Winchester Street, London, England, an investment holding
company, which is, in turn, a wholly owned subsidiary of Deutsche Bank. MGAM
currently manages approximately $16.5 billion for a wide range of pension,
corporate, insurance, local authority, government and private clients world-
wide. (See Annex II for a list of those investment companies that MGI advises
that have investment objectives similar to those of the Portfolios, together
with information regarding the fees charged to those companies.)
The names, business addresses and principal occupations of the current di-
rectors and chief executive officer of MGI are set forth below. Except as oth-
erwise indicated, the business address of the individuals named below is 885
Third Avenue, 32nd Floor, New York, NY 10022 and their positions at MGI con-
stitute their principal occupation.
<TABLE>
<CAPTION>
Name and Address Principal Occupation
- -------------------------------------------------------------------------------
<C> <S>
Richard Marin President and Director, Morgan Grenfell Inc.;
280 Park Avenue Managing Director, Bankers Trust Company
New York, NY 10017
David Westover Baldt Executive Vice President and Director, Morgan
Grenfell Inc.
Joan A. Binstock Chief Operating Officer, Secretary, Treasurer and
Director, Morgan Grenfell Inc.
Audrey Mary Theresa Jones Executive Vice President, Portfolio Manager and
Director, Morgan Grenfell Inc.
Robert H. Smith Chairman and Director, Morgan Grenfell Inc.; Chief
Executive Officer, Morgan Grenfell Asset Management;
Chairman and Chief Executive Officer, Morgan
Grenfell Development Capital
Steven Schneider Managing Director, Bankers Trust Company
280 Park Avenue
New York, NY 10017
</TABLE>
16
<PAGE>
Section 15(f) of the Act
Section 15(f) of the Act provides that when a change of control of an in-
vestment adviser to an investment company occurs, the investment adviser or any
of its affiliated persons may receive an amount or benefit in connection there-
with as long as two conditions are satisfied.
First, no "unfair burden" may be imposed on the investment company as a re-
sult of the transaction relating to the change of control, or any express or
implied terms, conditions or understandings applicable thereto. As defined in
the Act, the term "unfair burden" includes any arrangement during the two (2)
year period after the change in control whereby the investment adviser (or
predecessor or successor adviser), or any "interested person" (as defined in
the Act) of such adviser, receives or is entitled to receive any compensation,
directly or indirectly, from the investment company or its security holders
(other than fees for bona fide investment advisory or other services), or from
any person in connection with the purchase or sale of other property to, or on
behalf of the investment company (other than fees for bona fide brokerage and
principal underwriting services). The Advisers have advised the Boards that
there are no circumstances arising from the Merger that might result in an "un-
fair burden" (within the meaning of section 15(f) of the Act) being imposed on
the Portfolios. After conducting their reviews of the Advisers and of Bankers
Trust's performance, and after reviewing materials specifically provided by
Bankers Trust as a result of the termination of the Prior Advisory Agreements
and its request that the Boards approve the New Advisory Agreements, the Boards
were satisfied that they had received and appropriately considered the relevant
factors and, after consultation with counsel, the Boards determined to approve
the New Advisory Agreements.
The second condition is that, during the three (3) year period immediately
following the Merger, at least 75% of the members of the Portfolios' Boards
must not be "interested persons" of the Advisers within the meaning of the Act.
All current members of the Boards are not, and have continued not to be since
the Merger, "interested persons" of the Advisers.
Additional Information
On March 11, 1999, Bankers Trust announced that it had reached an agreement
with the United States Attorney's Office in the Southern District of New York
to resolve an investigation concerning inappropriate transfers of unclaimed
funds and related record-keeping problems that occurred between 1994 and early
1996. Bankers Trust pleaded guilty to misstating entries in the bank's books
and records and agreed to pay a $63.5 million fine to state and federal author-
ities. On July 26, 1999, the federal criminal proceedings were concluded with
Bankers Trust's formal sentencing. The events leading up to the guilty pleas
did not arise out of the investment advisory or mutual fund management activi-
ties of Bankers Trust or its affiliates.
17
<PAGE>
As a result of the plea, absent an order from the Commission, Bankers Trust
would not be able to continue to provide investment advisory services to the
Portfolios or the Funds. The Commission has granted Bankers Trust a temporary
order under Section 9(c) of the Act to permit Bankers Trust and its affiliates
to continue to provide investment advisory services to registered investment
companies, and Bankers Trust, pursuant to Section 9(c) of the Act, has filed an
application for a permanent order. On May 7, 1999, the Commission extended the
temporary order under Section 9(c) of the Act until the Commission takes final
action on the application for a permanent order, or, if earlier, November 8,
1999. However, there is no assurance that the Commission will grant a permanent
order. If the Commission refuses to grant a permanent order, shareholders will
receive supplemental proxy materials requesting approval to release any amounts
held in escrow up to the time of the refusal and such other action as deemed
appropriate by the Boards.
Recommendation of the Boards
At a meeting of the Boards held on March 8, 1999 called for the purpose of,
among other things, voting on approval of the New BT Advisory Agreements, the
Boards, including the Independent Trustees, unanimously approved the New BT Ad-
visory Agreements. In reaching this conclusion, the Boards obtained from BT
Corporation, Deutsche Bank and Bankers Trust such information as they deemed
reasonably necessary to approve Bankers Trust as investment adviser to the
Portfolios. Additionally, the Boards considered a number of factors, including,
among other things, the continuity of the management of the Portfolios after
the Merger; the nature, scope and quality of services that Bankers Trust would
likely provide to the Portfolios; the quality of the personnel of Bankers
Trust; Bankers Trust's commitment to continue to provide these services in the
future; the maintenance of the identical advisory fee rates; and the fact that
the New BT Advisory Agreements contain substantially the same terms and condi-
tions as the Prior Advisory Agreements. Based on the factors discussed above
and others, the Boards determined that the New BT Advisory Agreements are fair
and reasonable and in the best interest of the Portfolios and their respective
shareholders.
At meetings of the Boards held on July 15 and July 27, 1999 called for the
purpose of, among other things, discussing and voting on approval of the New
MGI Advisory Agreements and the New Sub-advisory Agreements, the Boards ob-
tained from Deutsche Bank and MGI such information as they deemed reasonably
necessary to approve MGI as an investment adviser to the Portfolios. Represent-
atives of Deutsche Bank and MGI made detailed presentations at the July 15th
and July 27th meetings with respect to, among other factors, the organizational
structure, assets under management, asset management services, financial condi-
tion and business plan of MGI. The Boards considered the same factors described
above for the New BT Advisory Agreements with regard to the New MGI Advisory
Agreements and the New Sub-advisory Agreements. The Boards
18
<PAGE>
also considered a number of other factors, including the capacity of MGI to
perform its duties under the New Advisory Agreements; the high degree of conti-
nuity of investment management personnel expected to be available to the Port-
folios because most of the personnel of Bankers Trust who provided services un-
der the Prior Management Agreements will be employed by MGI; the financial
standings of Deutsche Bank and MGI; the benefits to the Funds and Portfolios
from technological advances being instituted by Deutsche Bank on a world-wide
basis; the experience and expertise of MGI as an investment adviser, as re-
flected in its amount of assets under management; and the new organizational
structure proposed to be created as a component of the Merger and the benefits
that may accrue to the shareholders as a result thereof. With respect to the
last factor, the Boards considered that the proposed organizational structure
may simplify the organizational structure of Deutsche Bank's U.S. mutual fund
operations, enhance the efficiency of their administration and promote consis-
tency of internal controls, compliance and regulatory oversight. Additionally,
the eventual implementation of the New MGI Advisory Agreements will provide the
Funds and the Portfolios with an investment adviser registered under the Advis-
ers Act.
The Boards were apprised that the deferral in implementing the New MGI Ad-
visory Agreements is needed to permit Deutsche Bank a sufficient amount of time
(which will vary for different Portfolios) to plan, prepare and institute the
necessary arrangements for MGI to consolidate Deutsche Bank's U.S. mutual fund
operations. The Advisers also emphasized to the Boards that the New MGI Advi-
sory Agreements and the New Sub-advisory Agreements would be implemented only
upon the approval of the Independent Trustees based on information they then
deemed adequate and necessary to consider these arrangements. At the July 27th
meeting of the Boards, a majority of the Boards, including a majority of the
Independent Trustees, approved the New MGI Advisory Agreements and the New Sub-
advisory Agreements.
Based on the factors discussed above and others, the Boards determined that
the New MGI Advisory Agreements and the New Sub-Advisory Agreements are fair
and reasonable and in the best interest of the Portfolios and their respective
shareholders.
In addition, at meetings held on March 24 and April 21, 1999 the Boards,
including the Independent Trustees, also were apprised of the guilty pleas dis-
cussed above and the exemptive relief sought by Bankers Trust.
Therefore, after careful consideration, the Boards, including the Indepen-
dent Trustees of each, recommend that the respective shareholders of the Funds
vote "FOR" the approval of the New Advisory Agreements as set forth in these
Proposals.
If the New BT Advisory Agreements are approved by the shareholders, each
agreement will continue in effect as described above. If any New BT
19
<PAGE>
Advisory Agreement is not approved by the shareholders, the advisory fees held
in escrow with respect to that New BT Advisory Agreement will be paid over to
the applicable Portfolio. In such event, the applicable Board(s) will consider
what other action is appropriate based upon the interests of the shareholders.
If any New MGI Advisory Agreements and/or New Sub-advisory Agreements are not
approved by the shareholders, the applicable New BT Advisory Agreement(s), if
they have been approved by the shareholders, will continue in effect in accor-
dance with their terms while the Boards consider whether and the extent to
which other action is appropriate based upon the interests of the shareholders.
If shareholders of a Fund do not approve the applicable New Advisory Agreements
at the same time that shareholders of other investment companies approve the
applicable New Advisory Agreements with respect to a common Portfolio in a man-
ner sufficient to implement the New Advisory Agreements for that Portfolio, the
applicable Fund will remain a participant in that Portfolio while the Boards
consider what other action, if any, is appropriate based upon the interests of
the shareholders of the applicable Fund.
20
<PAGE>
PROPOSAL II
ELECTION OF BOARDS OF TRUSTEES OF THE TRUST AND THE PORTFOLIOS
Trustees constituting the entire Board of Trustees of the Trust and of each
Portfolio are to be elected at the Special Meeting to serve until their succes-
sors have been duly elected and qualified or until their earlier resignation or
removal. The Trustee Nominees were recently selected by the Independent Trust-
ees of the Boards and nominated by the full Boards at meetings held on July 27,
1999. The names and ages of the Trustee Nominees, their principal occupations
during the past five years and certain of their other affiliations are provided
below. Of the Trustee Nominees, Martin J. Gruber and Harry Van Benschoten are
currently Trustees of the Trust and Charles P. Biggar, S. Leland Dill and
Philip Saunders, Jr. are currently Trustees of the Portfolios. No Trustee or
Trustee Nominee of the Trust or the Portfolios serves or will serve as an offi-
cer of the Trust or any Portfolio. Each of the Trustee Nominees has agreed to
serve if elected at the Special Meeting. It is the intention of the persons
designated as proxies in the Proxy, unless otherwise directed therein, to vote
at the Special Meeting for the election of the Trustee Nominees named below as
the entire Board of Trustees of the Trust and of each Portfolio. If any Trustee
Nominee is unable or unavailable to serve, the persons named in the Proxies
will vote the Proxies for such other person as the Boards may recommend.
The following table sets forth the name, age, position with the
Trust/Portfolios, and principal occupation of each Trustee Nominee; each
Trustee Nominee is proposed to be elected as such for the Trust and for each
Portfolio.
TRUSTEE NOMINEES
<TABLE>
<CAPTION>
Position with Principal Occupations During Last
Name and Age Trust/Portfolios Five Years
- ------------------------------------------------------------------------------
<C> <C> <S>
Charles P. Trustee of Portfolios Retired; formerly, Vice President of
Biggar (1)+ since inception of International Business Machines
Age: 68 each Portfolio ("IBM") and President of the National
Services and Field Engineering
Divisions of IBM.
S. Leland Dill Trustee of Portfolios Retired; Director, Coutts (U.S.A.)
(1)+ since inception of International; Trustee, Phoenix-Zweig
Age: 69 each Portfolio Trust(4) and Phoenix-Euclid Market
Neutral Fund(4); former Partner of
KPMG Peat Marwick; Director, Vintners
International Company Inc.; Director,
Coutts Trust Holdings Ltd.; Director,
Coutts Group; General Partner,
Pemco(4).
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
Principal Occupations During
Position with Last
Name and Age Trust/Portfolios Five Years
- -------------------------------------------------------------------------------
<C> <C> <S>
Martin J. Gruber (1)+ Trustee of Trust Nomura Professor of Finance,
Age: 62 since 1992 Leonard N. Stern School of
Business, New York University
(since 1964); Trustee,
TIAA(4); Trustee, Cowen Mutual
Funds(4); Trustee, Japan
Equity Fund(4); Trustee,
Taiwan Equity Fund(4).
Richard Hale* Managing Director, Deutsche
Age: 54 Asset Management; Director,
Flag Investors Fund(4);
Managing Director, BT Alex.
Brown Incorporated; Director
and President, Investment
Company Capital Corp.
Richard J. Herring (2)+ Jacob Safra Professor of
Age: 53 International Banking,
Professor of Finance and Vice
Dean, The Wharton School,
University of Pennsylvania
(since 1972).
Bruce E. Langton (2)+ Retired; Trustee, Allmerica
Age: 68 Financial Mutual Funds (1994
to present); Member, Pension &
Thrift Plans and Investment
Committee, Unilever U.S.
Corporation (1989 to
present)(3); Director, TWA
Pilots Directed Account Plan
and 401K Plan (1988 to
present)(4).
Philip Saunders, Jr. (1)+ Trustee of Portfolios Principal, Philip Saunders
Age: 63 since inception of Associates (Economic and
each Portfolio Financial Analysis); Former
Director, Financial Industry
Consulting, Wolf and Company;
President, John Hancock Home
Mortgage Corporation; Senior
Vice President of Treasury and
Financial Services, John
Hancock Mutual Life Insurance
Company, Inc.
Harry Van Benschoten (1)+ Trustee of Trust Retired; Director, Canada Life
Age: 71 since 1992 Insurance Corporation of New
York.
</TABLE>
- -----------
* "Interested Person" within the meaning of Section 2(a)(19) of the Act.
+ Dr. Gruber and Mr. Van Benschoten are members of the Audit Committee of the
Board of the Trust and Messrs. Biggar, Dill and Saunders are members of the
Audit Committees of the Boards of the Portfolios.
(1) Holds one other Trusteeship in the Bankers Trust Fund Complex, as defined
below.
(2) Holds two other Trusteeships in the Bankers Trust Fund Complex, as defined
below.
(3) A publicly held company with securities registered pursuant to section 12
of the Exchange Act.
(4) An investment company registered under the Act.
22
<PAGE>
Each Board has established an Audit Committee that meets with the
Trust's/Portfolios' independent accountants to review the financial statements
of the Trust/Portfolios, the adequacy of internal controls and the accounting
procedures and policies of the Trust/Portfolios, and reports on these matters
to the Board. The Independent Trustees of each Board, who constitute 100% of
the membership of each current Board, select and nominate the new trustee
nominees who are not "interested persons," as defined under the Act, of the
Trust or Portfolios, as applicable. The Boards do not have compensation
committees. During 1998, the Boards held four meetings and the Audit Committee
held two meetings.
If Richard Hale is elected, he will not be a member of the
Audit Committee.
The following table sets forth the compensation received by the Trustee
Nominees for their services to the Trust, Portfolios and Bankers Trust Fund
Complex (as defined below) during the most recent calendar year. In addition
to the fees listed below, the Trustees are also reimbursed for all reasonable
expenses incurred during the execution of their duties for the Trust,
Portfolios and Bankers Trust Fund Complex.
<TABLE>
<CAPTION>
Aggregate Estimated
Aggregate Compensation Pension or Retirement Annual Total Compensation
Compensation from the Benefits Accrued as Benefits upon From the Complex*
Name of Trustee from the Trust Portfolios Part of Trust Expenses Retirement Paid to Trustees
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Charles P. Biggar N/A $25,143 N/A N/A $36,250
S. Leland Dill N/A $ 3,882 N/A N/A $36,250
Martin J. Gruber $19,167 N/A N/A N/A $36,250
Richard Hale N/A N/A N/A N/A N/A
Richard J. Herring N/A N/A N/A N/A $35,000
Bruce E. Langton N/A $25,425 N/A N/A $35,000
Philip Saunders, Jr. N/A $ 3,910 N/A N/A $36,250
Harry Van Benschoten $19,167 N/A N/A N/A $36,250
</TABLE>
- ----------
* The "Bankers Trust Fund Complex" consists of the Trust and the Portfolios,
as well as BT Institutional Funds, BT Investment Funds, BT Adviser Funds
and BT Insurance Funds Trust.
23
<PAGE>
The following table sets forth the names, ages, position with the Trust and
length of service in such position, and principal occupations during the past
five years of the Officers of the Trust.
<TABLE>
<CAPTION>
Name and Age Position with Trust and Principal Occupations
- -----------------------------------------------------------------------------------------
<C> <S>
John A. Keffer President and Chief Executive Officer since 1998; President, Forum
Age: 57 Financial Group L.L.C. and its affiliates; President, ICC Distributors,
Inc.
Daniel O. Hirsch Secretary since 1998; Director, Deutsche Asset Management since 1999;
Age: 45 Director, BT Alex. Brown Incorporated and Investment Company Capital
Corporation, 1998-99; Associate General Counsel, Office of General
Counsel, United States Securities and Exchange Commission, 1993-1998.
Charles A. Rizzo Treasurer since 1999; Vice President and Department Head, Deutsche
Age: 41 Asset Management since 1998; Senior Manager, PricewaterhouseCoopers LLP
1993-98.
- -----------------------------------------------------------------------------------------
</TABLE>
- -----------
* Underwriter/distributor for the Trust. Mr. Keffer owns 100% of the shares of
ICC Distributors, Inc.
24
<PAGE>
Recommendation of the Boards
At a meeting of the Boards held on July 27, 1999, the Boards, based on a
recommendation of the incumbent Independent Trustees of each, unanimously ap-
proved the nomination of the Trustee Nominees. In reaching this conclusion, the
Boards obtained from the Trustee Nominees such information as they deemed rea-
sonably necessary to approve the Trustee Nominees and considered a number of
factors, including, among other things: alignment of the members of the Boards
of the Trust and the Portfolios; the nature, scope and quality of services that
the Trustee Nominees would likely provide to the Trust and the Portfolios; and
the desirability of maintaining adherence to Section 15(f) of the Act. Based on
the factors discussed above and others, the Boards determined that the election
of the Trustee Nominees is in the best interest of the Trust and the Portfolios
and their respective shareholders.
Therefore, after careful consideration, the Boards, including the Indepen-
dent Trustees of each, recommend that the respective shareholders of the Trust
and the Portfolios vote "FOR" the election of the Trustee Nominees as set forth
in this Proposal.
If the Trustee Nominees are elected by the applicable shareholders, each
Trustee Nominee will serve until his successor is duly elected and qualified or
until his earlier resignation or removal. If the Trustee Nominees are not
elected, the applicable Board(s) will consider what action is appropriate based
upon the interests of the Trust's or Portfolios' shareholders, as applicable.
25
<PAGE>
PROPOSAL III
RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT
ACCOUNTANTS FOR BT INVESTMENT MONEY MARKET FUND, BT CASH MANAGEMENT PORTFOLIO,
BT INVESTMENT EQUITY 500 INDEX FUND, BT EQUITY 500 INDEX PORTFOLIO AND BT
EQUITY APPRECIATION FUND
The Boards of the Trust and the above Portfolios, including a majority of
the Independent Trustees of each, have approved the selection of
PricewaterhouseCoopers LLP to serve as independent accountants for the above
Funds and the above Portfolios for the current fiscal year.
PricewaterhouseCoopers LLP has served as independent accountants of each Fund
and each Portfolio since the date of the applicable Fund and Portfolio's incep-
tion and has advised the Trust and the Portfolios that they have no direct or
indirect financial interest in any Fund or Portfolio. Representatives of
PricewaterhouseCoopers LLP are not expected to be present at the Special Meet-
ing and, thus, are not expected to make a statement; however, one or more rep-
resentatives will be available by telephone to respond to appropriate questions
posed by shareholders or management.
Therefore, after careful consideration, the Boards, including the Indepen-
dent Trustees of each, recommend that the respective shareholders of the Trust
and the Portfolios vote "FOR" the ratification of the independent accountants
as set forth in this Proposal.
26
<PAGE>
PROPOSAL IV
RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS INDEPENDENT ACCOUNTANTS
FOR PRESERVATIONPLUS FUND AND PRESERVATIONPLUS PORTFOLIO
The Boards of the Trust and PreservationPlus Portfolio, including a major-
ity of the Independent Trustees of each, have approved the selection of Ernst &
Young LLP to serve as independent accountants for PreservationPlus Fund and
PreservationPlus Portfolio for the current fiscal year. Ernst & Young LLP has
served as independent accountants of PreservationPlus Fund and PreservationPlus
Portfolio since their respective dates of inception and has advised the Trust
and the PreservationPlus Portfolio that they have no direct or indirect finan-
cial interest in PreservationPlus Fund or PreservationPlus Portfolio. Repre-
sentatives of Ernst & Young LLP are not expected to be present at the Special
Meeting and, thus, are not expected to make a statement; however, one or more
representatives will be available by telephone to respond to appropriate ques-
tions posed by shareholders or management.
Therefore, after careful consideration, the Boards, including the Indepen-
dent Trustees of each, recommend that the respective shareholders of the Trust
and the Portfolios vote "FOR" the ratification of the independent accountants
as set forth in this Proposal.
VOTE REQUIRED
In view of the master-feeder structure discussed earlier, approval of each
of Proposals IA, IB and IC with respect to a particular Portfolio's New Advi-
sory Agreements requires the affirmative vote of a "majority" of the outstand-
ing shares of the Portfolio's various feeder funds as shareholders of the Port-
folio. "Majority" (as defined in the Act) means (as of the Record Date) the
lesser of (a) 67% or more of the shares of the applicable Portfolio present at
the special meeting, if the holders of more than 50% of the outstanding shares
of the Portfolio are present in person or by proxy, or (b) more than 50% of the
outstanding shares of the Portfolio (with respect to the applicable feeder
funds) determined by reference to the shares outstanding of the various feeder
funds). Because abstentions and broker non-votes are treated as shares present
but not voting, any abstentions and broker non-votes will have the effect of
votes against Proposals IA, IB and IC, which require the approval of a speci-
fied percentage of the outstanding shares of a Portfolio.
Approval of Proposal II with respect to the Trustee Nominees of the Trust
requires the affirmative vote of a plurality of the votes cast in person or by
proxy at the Special Meeting for all Funds voting collectively. Approval of
Proposal II with respect to the Trustee Nominees of the Portfolios requires the
affirmative
27
<PAGE>
vote of a plurality of the votes cast in person or by proxy at the special
meetings of shareholders of all the Portfolios' various feeder funds voting
collectively. Because abstentions and broker non-votes are not treated as
shares voted, abstentions and broker non-votes will have no impact on Proposal
II.
Approval of Proposals III and IV with respect to the selection of the inde-
pendent accountants of the applicable Funds requires the affirmative vote of a
majority of the votes cast in person or by proxy at the Special Meeting for
each Fund. Approval of Proposals III and IV with respect to the selection of
the independent accountants of the applicable Portfolios requires the affirma-
tive vote of a majority of the votes cast in person or by proxy at the special
meetings of shareholders of each Portfolio's various feeder funds. Because ab-
stentions and broker non-votes are not treated as shares voted, abstentions and
broker non-votes will have no impact on Proposals III and IV.
THE BOARDS, INCLUDING THE INDEPENDENT TRUSTEES OF EACH, RECOMMEND THAT THE
SHAREHOLDERS VOTE "FOR" APPROVAL OF PROPOSALS IA, IB, IC, II, III AND
IV. ANY UNMARKED PROXIES WILL BE SO VOTED.
The Board is not aware of any other matters that will come before the Spe-
cial Meeting. Should any other matter properly come before the Special Meeting,
it is the intention of the persons named in the accompanying Proxy to vote the
Proxy in accordance with their judgment on such matters.
SUBMISSION OF SHAREHOLDER PROPOSALS
The Funds do not hold regular shareholders' meetings. Shareholders wishing
to submit proposals for inclusion in a proxy statement for a subsequent share-
holders' meeting should send their written proposals to the Secretary of the
Trust at the address set forth on the cover of this Proxy Statement.
Proposals must be received at a reasonable time prior to the date of a
meeting of shareholders to be considered for inclusion in the materials for a
Fund's meeting. Timely submission of a proposal does not, however, necessarily
mean that such proposal will be included.
SHAREHOLDERS' REQUEST FOR SPECIAL MEETING
Shareholders holding at least 10% of each Fund's outstanding voting securi-
ties (as defined in the Act) may require the calling of a meeting of sharehold-
ers for the purpose of voting on the removal of any Trustee of the Fund. Meet-
ings of shareholders for any other purpose also shall be called by the applica-
ble Board of
28
<PAGE>
Trustees when requested in writing by shareholders holding at least 10% of the
shares then outstanding.
IF YOU HAVE ANY QUESTIONS CONCERNING THE PROXY STATEMENT OR THE PROCEDURES
TO BE FOLLOWED TO EXECUTE AND DELIVER A PROXY, PLEASE CONTACT SHAREHOLDER COM-
MUNICATIONS CORPORATION AT 1-800-732-6168.
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE SPECIAL MEETING
AND WHO WISH TO HAVE THEIR SHARES VOTED ARE REQUESTED TO DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE,
UNLESS THEY ARE VOTING BY TELEPHONE OR THROUGH THE INTERNET.
By Order of the Board of Trustees,
/s/ Daniel O. Hirsch
Daniel O. Hirsch, Secretary
August 23, 1999
THE BOARD OF TRUSTEES OF THE TRUST HOPES THAT SHAREHOLDERS WILL ATTEND
THE SPECIAL MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, YOU ARE
URGED TO COMPLETE, DATE, SIGN AND RETURN EACH ENCLOSED PROXY IN
THE ACCOMPANYING ENVELOPE (UNLESS YOU ARE VOTING BY TELEPHONE OR
THROUGH THE INTERNET).
29
<PAGE>
Annex I
(i) 5% Shareholders
MONEY MARKET FUND:
<TABLE>
<CAPTION>
Shares
Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- -----------------------------------------------------------------------------
<S> <C> <C>
Bankers Trust Co. 113,912,369.4200 19.232%
Custody Texas Instruments Employees
Universal Profit Sharing Plan
Attn: Michael Bucowski
34 Exchange Place
Jersey City, NJ 07302- 3885
Capital Factors 51,012,156.6300 8.612%
Financing Trust Series 1994-1
120 East Palmetto Park Road
Boca Raton, FL 33432-4835
</TABLE>
EQUITY 500 FUND:
<TABLE>
<CAPTION>
Name and Address of Beneficial Shares Beneficially Percent Ownership
Owner Owned of Outstanding Shares
- ------------------------------------------------------------------------------
<S> <C> <C>
Bankers Trust Company 944,347.4260 17.589%
Custody 401(k) Westinghouse
Personal Investment
Bankers Trust Co. Mail Stop 3064
Attn: John Sawicki
34 Exchange Place, 6th Floor
Jersey City, NJ 07302-3885
State Street Bank and Trust Custody 597,853.6060 11.136%
of Northrop Grumman ESSD Savings
Attn: Annette Johnson
34 Exchange Place, # 6-3064
Jersey City, NJ 07302-3885
Bankers Trust Company 481,983.3900 8.977%
Custody 401(k) Matsushita Elec.
Corp. of America
Attn: Elijah Outen
100 Plaza One, Mailstop 3064
Jersey City, NJ 07311-3999
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Shares Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- -------------------------------------------------------------------------------
<S> <C> <C>
Bankers Trust Co. Custody 401(k) 319,737.5500 5.955%
Framatome Technologies
Attn: Tom Arnold
Recordkeeping
684 Grassmere Park Road
Nashville, TN 37211-3658
Bechtel Bettis Inc. Savings Plan 275,197.1960 5.126%
c/o Bankers Trust Company
100 Plaza One
Jersey City, NJ 07311-3901
</TABLE>
PRESERVATIONPLUS FUND:
<TABLE>
<CAPTION>
Shares Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- ----------------------------------------------------------------------------------
<S> <C> <C>
Institutional Service Class
Collins & Aikman Retirement Income Plan 4,020,896.304 35.167%
c/o Bankers Trust
100 Plaza One MS 3055
Attn: Frances Chaba
Jersey City NJ 07311-3902
Bankers Trust Co. Trustee 3,433,270.39 30.027%
U/A Dtd 7/1/91
FBO The Sweetheart Cup Co.
100 Plaza One
401K PS & Retirement Plan
Jersey City NJ 07311-3901
Bankers Trust Co. Trustee 2,046,740.784 17.901%
U/A Dtd 10/1/98
Grove US LLC Retirement Savings 40
130 Liberty Street Fl. 20
Attn: Anna Tikonoff
New York, NY 10006-1105
Northwestern Trust Company 1,806,704.765 15.801%
SVG 401K Savings Plan
1201 3rd Avenue Suite 2010
Seattle WA 98101-3206
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
Shares Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- -------------------------------------------------------------------------------
<S> <C> <C>
Institutional Class
Chase Manhattan Bank Trustee 9,482,704.52 51.278%
U/A 1/1/85 FBO Avon Employees
Savings & Stock Ownership Plan
130 Liberty Street Fl. 23
Attn: Anna Tikonoff
New York NY 10006-1105
Bankers Trust Co. of CA 3,531,523.586 19.097%
Trustee U/A 8/1/92
Futura 401(K) Savings Plan
PO Box 9014 Church St. Station
Fixed Account
New York NY 10008
Boston Safe Deposit & Trust Co. 2,850,105.798 15.412%
Trustee Thermo Electron Corp.
Plus Plan U/A Dtd 1/1/94
130 Liberty Street Fl. 23
New York NY 10006-1105
Investment Class
Robert E. Rich, Robert E. Rich, Jr., 1,617,202.175 80.059%
David A. Rich, Trustees
U/A Dtd 1/1/85
Rich Prods. Retirement & Savings
Plan
1150 Niagara Street
c/o James R. Haddad
Buffalo, NY 14213-1714
Province HealthCare Company 165,664.291 8.201%
401K Plan U/A Dtd 11/1/97
c/o Amsouth Bank
PO Box 830859
Attn: Tracey Crain
Birmingham AL 35283
Service Class
National Plus 401K Plan 673,702.706 43.973%
FBO Textile Workers Pension Fund
U/A Dtd 3/30/89
6 Blackstone Valley Pl. Ste. 302
c/o Monica Bender
Lincoln RI 02865-1112
</TABLE>
I-3
<PAGE>
<TABLE>
<CAPTION>
Shares
Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- ------------------------------------------------------------------------
<S> <C> <C>
Northwestern Trust Company 466,454.655 30.446%
U/A Dtd 9/1/96
FBO Community Health Systems
1201 3rd Avenue Ste. 2010
Retirement & Profit Sharing Plan
Seattle WA 98101-3026
Security Trust Company Trustee 233,261.04 15.225%
U/A Dtd 5/1/99
FBO Burnstead Construction
2390 E. Camelback Rd. Ste. 240
401(K) PSP
Phoenix AZ 85016-3434
Patrick Shao & Deb Schmitz Trustees 85,737.601 5.596%
Wheel Works 401(K) Plan
802 S. 1st Street
San Jose CA 95110-3194
</TABLE>
EQUITY APPRECIATION FUND:
<TABLE>
<CAPTION>
Shares
Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- --------------------------------------------------------------------------------
<S> <C> <C>
Northern Telecom Omnibus Account 5,101,490.6550 60.177%
c/o Bankers Trust Company
Attn: John Sawicki
Mail-stop 3064
34 Exchange Place, 6th Floor
Jersey City, NJ 07302-3885
Bankers Trust Co. as Trustee for 1,633,735.1290 19.272%
Westinghouse Savannah River Inc. Savings
and Investment Plan
34 Exchange Pl.--Mail Stop 3064
Jersey City, NJ 07302-3885
Bankers Trust Co. as Trustee 514,213.3720 6.066%
for Hanson Industries Plan 401(k)
Attn: Marisa Depp,
Mail Stop 3055
34 Exchange Pl., 5th Floor
Jersey City, NJ 07302-3885
</TABLE>
I-4
<PAGE>
<TABLE>
<CAPTION>
Shares
Beneficially Percent Ownership
Name and Address of Beneficial Owner Owned of Outstanding Shares
- -----------------------------------------------------------------------------
<S> <C> <C>
Bankers Trust Co. as Trustee for 502,724.1040 5.930%
Millenium Chemicals 401(k)
Attn: Linda Castello
200 International Circle, Ste 2000
Hunt Valley, MD 21030-1336
(ii) Trustees and Trustee Nominees *
Charles P. Biggar *
S. Leland Dill *
Martin J. Gruber *
Richard Hale *
Richard J. Herring *
Bruce E. Langton *
Philip Saunders, Jr. *
Harry Van Benschoten *
(iii) Executive Officers *
John A. Keffer *
Daniel O. Hirsch *
Charles Rizzo *
(iv) Trustees and Executive Officers as a *
Group
</TABLE>
- -----------
*The Trustees, the Trustee Nominees, the executive officers of the Trust and
the Trustees and executive officers as a group own less than 1% of the Fund's
outstanding shares.
I-5
<PAGE>
Annex II
BT Pyramid Funds
<TABLE>
<CAPTION>
Net Assets Advisory
(As of Most Fee as a
Recently Percentage of
Completed Average Daily
Fiscal Year) Net Assets
- ------------------------------------------------------------------------------
<S> <C> <C>
Cash Management Portfolio:
Includes the following feeder funds: 0.15%
BT Investment Cash Management Fund.......... $ 232,585,828.00
BT Investment Money Market Fund............. $ 436,604,000.00
BT Institutional Cash Management Fund....... $2,347,142,000.00
Institutional Cash Reserves................. $2,367,776,951.00
Money Market ProFund........................ $ 204,909,098.00
Treasury Money Portfolio:
Includes the following feeder funds: 0.15%
BT Investment Treasury Money Fund........... $ 308,910,930.00
BT Institutional Treasury Money Fund........ $1,728,834,000.00
Capital Appreciation Portfolio:
Includes the following feeder fund: 0.65%
BT Investment Capital Appreciation Fund..... $ 25,496,736.00
Small Cap Portfolio:
Includes the following feeder fund: 0.65%
BT Investment Small Cap Fund................ $ 172,310,059.00
BT Investment Equity Appreciation Fund........ $ 122,077,106.00 0.65%
American General Series Portfolio Company 3--
Small Cap Value Fund (VALIC)a............... $ 3,273,066.27 NOTE A
Season Series Trust--Large Cap Growth
Portfolioa.................................. $ 5,142,375.93 0.10%--first
$500 million
0.03%--over
$500 million
Season Series Trust--Cap Composite
Portfolioa.................................. $ 5,308,328.33 0.05%--first
$500 million
0.03%--over
$500 million
Season Series Trust--Cap Value Portfolioa..... $ 5,470,359.19 0.10%--first
$500 million
0.03%--over
$500 million
Season Series Trust--Cap Growth Portfolioa.... $ 5,380,426.86 0.10%--first
$500 million
0.03%--over
$500 million
</TABLE>
- ----------
a Bankers Trust acts as Sub-Advisor of the portion of the portfolio of this
fund which invests according to an investment strategy that seeks to repli-
cate a securities index.
<PAGE>
<TABLE>
<CAPTION>
Net Assets Advisory
(As of Most Fee as a
Recently Percentage of
Completed Average Daily
Fiscal Year) Net Assets
- -------------------------------------------------------------------------------
<S> <C> <C>
Season Series Trust--Mid-Cap Value $ 5,504,588.18 0.10%--first
Portfolioa.................................. $500 million
0.03%--over
$500 million
Season Series Trust--Small-Cap Portfolioa..... $ 5,350,213.30 0.07%--first
$500 million
0.03%--over
$500 million
Morgan Grenfell Smaller Companies Fund........ $ 6,513,010.00 1.00%
Morgan Grenfell Micro Cap Fund................ $ 17,485,411.00 1.50%
Morgan Grenfell Small Cap Fund, Inc........... $ 116,599,100.00 1.00%
Morgan Grenfell International Select Equity
Fund........................................ $ 57,890,123.00 0.70%
Equity 500 Index Portfolio: 0.08%
Includes the following feeder funds:
BT Institutional Equity 500 Index Fund...... $2,288,969,859.00
Scudder S & P 500 Index Fund................ $ 244,805,518.35
American Aadvantage S & P 500 Index Fund.... $ 322,610,586.01
USAA S & P 500 Index Fund................... $2,713,859,248.97
American Aadvantage S&P 500 Index Mileage
Fund...................................... $ 3,632,960.16
BT Investment Equity 500 Index Fund......... $ 929,474,411.08
Quantitative Equity Fund...................... N/A/1/ 0.50%
American Skandia Trust--AST Bankers Trust
Enhanced 500 Portfolio...................... $ 452,128,871.00 NOTE J
Security Equity Fund--Enhanced Index Series
(Security Benefit).......................... $ 15,785,667.21 NOTE K
BT Insurance Equity 500 Index Fund............ $ 49,691,350.00 0.20%
American General Series Portfolio--MidCap
Index Fund (VALIC).......................... $ 814,774,297.65 NOTE D
American General Series Portfolio--Stock Index
Fund (VALIC)................................ $4,624,973,419.19 NOTE D
American General Series Portfolio Company 2--
Stock Index Fund (VALIC).................... $ 12,489,608.16 NOTE D
American General Series Portfolio Company 2--
MidCap Index Fund........................... $ 6,585,995.57 NOTE D
</TABLE>
- -----------
/1/The fund commenced operations on March 31, 1999. Accordingly, the fund does
not have a full fiscal year of operations to report.
II-2
<PAGE>
<TABLE>
<CAPTION>
Net Assets Advisory
(As of Most Fee as a
Recently Percentage of
Completed Average Daily
Fiscal Year) Net Assets
- ------------------------------------------------------------------------------
<S> <C> <C>
EQ Advisors Trust--BT Equity 500 Index
Portfolio (Equitable)...................... $ 392,561,486.32 0.05%
Variable Insurance Products Fund II--Index
500 Portfolio (Fidelity)................... $ 4,624,170,180.40 At an annual
rate of
0.006% (0.6
basis points)
Fidelity Concord Street Trust--Spartan U.S.
Equity Index Fund.......................... $17,202,394,585.66 At an annual
rate of
0.006% (0.6
basis points)
Pacific Select Fund--Equity Index Portfolio
(Pacific Mutual)........................... $ 1,808,280,989.82 NOTE E
AARP U.S. Stock Index Fund (Scudder)......... $ 464,922,428.55 NOTE F
</TABLE>
NOTE A) A monthly fee computed at the annual rate of 0.03% of the average daily
net asset value of the portion of the Small Cap Value Fund portfolio that BT
manages.
NOTE D) A monthly fee computed at the annual rate of 0.03% of the average daily
net asset values of the portion of the Small Cap Value Fund portfolio that BT
manages. With respect to the Stock Index Fund, VALIC shall pay to Bankers
Trust, a monthly fee computed at the annual rate of 0.02% of the first $2 bil-
lion and 0.01% of average daily net asset values on the excess over $2 billion.
VALIC shall pay Bankers Trust, a monthly fee computed at the annual rate of
0.03% of the first $300 million and 0.02% of average daily net asset values on
the excess over $300 million of the Mid Cap Index Fund, and 0.03% of the first
$150 million and 0.02% of average daily net asset values on the excess over
$150 million of the Small Cap Index Fund.
NOTE E) A fee is paid at the beginning of each calendar quarter, based on an
annual percentage of the combined daily net assets of the Equity Index and
Small-Cap Index Portfolios, according to the following schedule, subject to a
minimum annual fee of $100,000: 0.08% on first $100 million; 0.04% on next $100
million; 0.02% on excess.
NOTE F) The fee paid to the Sub-Adviser is calculated on a quarterly basis and
depends on the level of total assets in the AARP U.S. Stock Index Fund. The fee
rate decreases as the level of total assets for the Fund increases. The fee
rate for each level of assets is: 0.07% of the first $100 million of average
daily net assets, 0.03% of such assets in excess of $100 million, and 0.01% of
such assets in excess of $200 million with a minimum annual fee of $75,000.
II-3
<PAGE>
NOTE J) An annual rate of .17% of the portion of the average daily net assets
of the Portfolio not in excess of $300 million; plus .13% of the portion of the
net assets over $300 million.
NOTE K) An annual rate of .20% of the combined average daily net assets of the
Enhanced Index Funds of $100 million or less; and an annual rate of .15% of the
combined average daily net assets of the Enhanced Index Funds of more than $100
million but less than $300 million; and an annual rate of .13% of the combined
average daily net assets of the Enhanced Index Funds of more than $300 million.
Subject to the following minimum fees: (I) in the first year from the date the
Enhanced Index Series of Security Equity Fund is seeded (the "Seeding Date"),
no minimum fee; (ii) in the second year from the Seeding Date, $100,000 minimum
and (iii) in the third year from the Seeding Date and each year thereafter,
$200,000 minimum. If at the end of the second year from the Seeding Date the
total amount of the fees paid by the Advisor to the Sub-Advisor for services to
the Enhanced Index Funds is collectively less than $100,000, then the Advisor
will pay any such difference in a lump-sum to the Sub-Advisor. If at the end of
the third year from the Seeding Date, and each year thereafter that this Agree-
ment is in effect, the total amount of the fees paid by the Advisor to the Sub-
Advisor for services to the Enhanced Index Funds is collectively less than
$200,000, then the Advisor will pay any such difference in a lump-sum to the
Sub-Advisor.
II-4
<PAGE>
Annex III
<TABLE>
<CAPTION>
Fund Fee Portfolio Fee
- ----------------------------------------------------------------
<S> <C> <C> <C>
Equity Appreciation Fund $814,788 N/A N/A
- ----------------------------------------------------------------
Cash Management
Money Market Fund $1,295,091 Portfolio $2,673,031
- ----------------------------------------------------------------
Equity Index
Equity 500 Fund $2,262,552 Portfolio $ 676,625
- ----------------------------------------------------------------
PreservationPlus
PreservationPlus Fund $255,319 Portfolio $ 64,560
- ----------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT A
[FORM OF INVESTMENT ADVISORY AND
SUB-ADVISORY AGREEMENT]
AGREEMENT made as of [ ] by and between [Trust Name], a (state of or-
ganization) (herein called the "Trust") and [ ] (herein called the "In-
vestment Adviser") [and [ ] (herein called the "Investment Subadviser")].
WHEREAS, the Trust is registered as an open-end management investment com-
pany under the Investment Company Act of 1940;
WHEREAS, the Trust desires to retain the Investment Adviser to render in-
vestment advisory and other services to the Trust with respect to certain of
its series of shares of beneficial interests as may currently exist or be cre-
ated in the future (each, a "Fund") as listed on Exhibit A hereto, and the In-
vestment Adviser is willing to so render such services on the terms hereinaf-
ter set forth;
[WHEREAS, the Investment Adviser desires to retain the Investment
Subadviser to perform certain of the Investment Adviser's duties under this
Agreement, and the Investment Subadviser is willing to so render such services
on the terms hereinafter set forth;](/1/)
NOW, THEREFORE, this Agreement
W I T N E S S E T H:
In consideration of the promises and mutual covenants herein contained, it
is agreed between the parties hereto as follows:
1. Appointment. The [Trust] [Investment Adviser] hereby appoints the [In-
vestment Adviser] [Investment Subadviser] to act as [investment adviser] [in-
vestment subadviser] to each Fund for the period and on the terms set forth in
this Agreement. The [Investment Adviser] [Investment Subadviser] accepts such
appointment and agrees to render the services herein set forth for the compen-
sation herein provided.
2. Management. Subject to the supervision of the [Board of Trustees of the
Trust] [Investment Adviser], the [Investment Adviser] [Investment Subadviser]
will provide a continuous investment program for the Fund, including invest-
ment research and management with respect to all securities, investments, cash
and cash equivalents in the Fund. The [Investment Adviser] [Investment
Subadviser] will determine from time to time what securities and other invest-
ments will be
- -----------
(1) Contained in the form of Investment Sub-advisory Agreement only.
<PAGE>
purchased, retained or sold by each Fund. The [Investment Adviser] [Investment
Subadviser] will provide the services rendered by it hereunder in accordance
with the investment objective(s) and policies of each Fund as stated in the
Fund's then-current prospectus and statement of additional information (or the
Fund's then current registration statement on Form N-1A as filed with the Secu-
rities and Exchange Commission (the "SEC") and the then-current offering memo-
randum if the Fund is not registered under the Securities Act of 1933, as
amended ("1933 Act"). The [Investment Adviser] [Investment Subadviser] further
agrees that:
(a) it will conform with all applicable rules and regulations of the
SEC (herein called the "Rules") and with all applicable provisions of the
1933 Act; as amended, the Securities Exchange Act of 1934, as amended (the
"1934 Act"), the Investment Company Act of 1940, as amended (the "1940
Act"); and the Investment Advisers Act of 1940, as amended (the "Advisers
Act"), and will, in addition, conduct its activities under this Agreement
in accordance with applicable regulations of the Board of Governors of the
Federal Reserve System pertaining to the investment advisory activities of
bank holding companies and their subsidiaries;
(b) it will place orders pursuant to its investment determinations for
each Fund either directly with the issuer or with any broker or dealer se-
lected by it. In placing orders with brokers and dealers, the [Investment
Adviser] [Investment Subadviser] will use its reasonable best efforts to
obtain the best net price and the most favorable execution of its orders,
after taking into account all factors it deems relevant, including the
breadth of the market in the security, the price of the security, the fi-
nancial condition and execution capability of the broker or dealer, and
the reasonableness of the commission, if any, both for the specific trans-
action and on a continuing basis. Consistent with this obligation, the
[Investment Adviser] [Investment Subadviser] may, to the extent permitted
by law, purchase and sell portfolio securities to and from brokers and
dealers who provide brokerage and research services (within the meaning of
Section 28(e) of the 1934 Act) to or for the benefit of any fund and/or
other accounts over which the [Investment Adviser] [Investment Subadviser]
or any of its affiliates exercises investment discretion. Subject to the
review of the [Trust's Board of Trustees] [Investment Adviser] from time
to time with respect to the extent and continuation of the policy, the
[Investment Adviser] [Investment Subadviser] is authorized to pay to a
broker or dealer who provides such brokerage and research services a com-
mission for effecting a securities transaction which is in excess of the
amount of commission another broker or dealer would have charged for ef-
fecting that transaction if the [Investment Adviser] [Investment
Subadviser] determines in good faith that such commission was reasonable
in relation to the value of the brokerage and research services provided
by such broker or dealer, viewed in terms of either that particular trans-
action or the overall responsibilities of the [Investment Adviser] [In-
vestment
EX-2
<PAGE>
Subadviser] with respect to the accounts as to which it exercises invest-
ment discretion; and
(c) It will maintain books and records with respect to the securities
transactions of each Fund and will render to the [Trust's Board of Trust-
ees] [Investment Adviser] such periodic and special reports as the Board
may request.
[3. Subject to the provisions of this Agreement, the duties of the Invest-
ment Subadviser, the portion of portfolio assets that the Subadviser shall man-
age, and the fees to be paid the Investment Subadviser by the Investment Ad-
viser under and pursuant to this Agreement may be adjusted from time to time by
the Investment Adviser with and upon the approval of the Board and the members
of the Trust's Board of Trustees who are not "interested persons," as defined
in the Act ].(/2/)
4. Services Not Exclusive. The investment advisory services rendered by the
[Investment Adviser] [Investment Subadviser] hereunder are not to be deemed ex-
clusive, and the [Investment Adviser] [Investment Subadviser] shall be free to
render similar services to others so long as its services under this Agreement
are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3 of
the Rules under the 1940 Act, the [Investment Adviser] [Investment Subadviser]
hereby agrees that all records which it maintains for the Trust are the prop-
erty of the Trust and further agrees to surrender promptly to the [Trust] [In-
vestment Adviser] any of such records upon request of the [Trust] [Investment
Adviser]. The [Investment Adviser] [Investment Subadviser] further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940 Act the rec-
ords required to be maintained by Rule 31a-1 under the 1940 Act and to comply
in full with the requirements of Rule 204-2 under the Advisers Act pertaining
to the maintenance of books and records.
6. Expenses. During the term of this Agreement, the [Investment Adviser]
[Investment Subadviser] will pay all expenses incurred by it in connection with
its activities under this Agreement other than the cost of purchasing securi-
ties (including brokerage commissions, if any) for the Fund.
7. Compensation. For the services provided and the expenses assumed pursu-
ant to this Agreement, the [Trust] [Investment Adviser] will pay the [Invest-
ment Adviser] [Investment Subadviser], and the [Investment Adviser] [Investment
Subadviser] will accept as full compensation therefor, fees, computed daily and
payable monthly, on an annual basis equal to the percentage set forth on Ex-
hibit A hereto of that Fund's average daily net assets.
- -----------
(2) Provision contained in the form of Investment Sub-advisory Agreement only.
EX-3
<PAGE>
8. Limitation of Liability of the [Investment Adviser] [Investment
Subadviser]: Indemnification.
(a) The [Investment Adviser] [Investment Subadviser] shall not be liable
for any error of judgment or mistake of law or for any loss suffered by a Fund
in connection with the matters to which this Agreement relates, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of com-
pensation for services or a loss resulting from willful misfeasance, bad faith
or gross negligence on the part of the [Investment Adviser] [Investment
Subadviser] in the performance of its duties or from reckless disregard by it
of its obligations and duties under this Agreement;
(b) Subject to the exceptions and limitations contained in Section 7(c)
below:
(i) the [Investment Adviser] [Investment Subadviser] (hereinafter re-
ferred to as a "Covered Person") shall be indemnified by the respective
Fund to the fullest extent permitted by law, against liability and against
all expenses reasonably incurred or paid by him in connection with any
claim, action, suit or proceeding in which he becomes involved, as a party
or otherwise, by virtue of his being or having been the [Investment Advis-
er] [Investment Subadviser] of the Fund, and against amounts paid or in-
curred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or "proceeding" shall apply
to all claims, actions, suits or proceedings (civil, criminal or other,
including appeals), actual or threatened while in office or thereafter,
and the words "liability" and "expenses" shall include, without limita-
tion, attorneys' fees, costs, judgments, amounts paid in settlement,
fines, penalties and other liabilities.
(c) no indemnification shall be provided hereunder to a Covered Person:
(i) who shall have been adjudicated by a court or body before which
the proceeding was brought (A) to be liable to the [Trust] [Investment Ad-
viser] or to one or more Funds' investors by reason of willful misfea-
sance, bad faith, gross negligence or reckless disregard of the duties in-
volved in the conduct of his office, or (B) not to have acted in good
faith in the reasonable belief that his action was in the best interest of
a Fund; or
(ii) in the event of a settlement, unless there has been a determina-
tion that such Covered Person did not engage in willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in
the conduct of his office;
(A) by the court or other body approving the settlement; or
(B) by at least a majority of those Trustees who are neither In-
terested Persons of the Trust nor are parties to the matter based
upon a
EX-4
<PAGE>
review of readily available facts (as opposed to a full trial-type
inquiry); or
(C) by written opinion of independent legal counsel based upon a
review of readily available facts (as opposed to a full trial-type
inquiry); provided, however, that any investor in a Fund may, by ap-
propriate legal proceedings, challenge any such determination by the
Trustees or by independent counsel.
(d) The rights of indemnification herein provided may be insured against
by policies maintained by the [Trust] [Investment Adviser], shall be severa-
ble, shall not be exclusive of or affect any other rights to which any Covered
Person may now or hereafter be entitled, shall continue as to a person who has
ceased to be a Covered Person and shall inure to the benefit of the successors
and assigns of such person. Nothing contained herein shall affect any rights
to indemnification to which Trust personnel and any other persons, other than
a Covered Person, may be entitled by contract or otherwise under law.
(e) Expenses in connection with the preparation and presentation of a de-
fense to any claim, suit or proceeding of the character described in subsec-
tion (b) of this Section 7 may be paid by the [Trust] [Investment Adviser] on
behalf of the respective Fund from time to time prior to final disposition
thereto upon receipt of an undertaking by or on behalf of such Covered Person
that such amount will be paid over by him to the [Trust] [Investment Adviser]
on behalf of the respective Fund if it is ultimately determined that he is not
entitled to indemnification under this Section 7; provided, however, that ei-
ther (i) such Covered Person shall have provided appropriate security for such
undertaking or (ii) the [Trust] [Investment Adviser] shall be insured against
losses arising out of any such advance payments, or (iii) either a majority of
the Trustees who are neither Interested Persons of the Trust nor parties to
the matter, or independent legal counsel in a written opinion, shall have de-
termined, based upon a review of readily available facts as opposed to a tri-
al-type inquiry or full investigation, that there is reason to believe that
such Covered Person will be entitled to indemnification under this Section 7.
9. Duration and Termination. is Agreement shall be effective as to a Fund
as of the date the Fund commences investment operations after this Agreement
shall have been approved by the Board of Trustees of the Trust with respect to
that Fund and the Investor(s) in the Fund in the manner contemplated by Sec-
tion 15 of the 1940 Act and, unless sooner terminated as provided herein,
shall continue until the second anniversary of such date. Thereafter, if not
terminated, this Agreement shall continue in effect as to such Fund for suc-
cessive periods of 12 months each, provided such continuance is specifically
approved at least annually (a) by the vote of a majority of those members of
the Board of Trustees of the Trust who are not parties to this Agreement or
Interested Persons of any such
EX-5
<PAGE>
party, cast in person at a meeting called for the purpose of voting on such
approval, or (b) by Vote of a Majority of the Outstanding Voting Securities of
the Trust; provided, however, that this Agreement may be terminated by the
Trust at any time, without the payment of any penalty, by the Board of Trust-
ees of the Trust, by Vote of a Majority of the Outstanding Voting Securities
of the Trust on 60 days' written notice to the [Investment Adviser] [Invest-
ment Subadviser], or by the [Investment Adviser] [Investment Subadviser] as to
the [Trust] [Investment Adviser] at any time, without payment of any penalty,
on 90 days' written notice to the [Trust] [Investment Adviser]. This Agreement
will immediately terminate in the event of its assignment (as used in this
Agreement, the terms "Vote of a Majority of the Outstanding Voting Securi-
ties," "Interested Person" and "Assignment" shall have the same meanings as
such terms have in the 1940 Act and the rules and regulatory constructions
thereunder.)
10. Amendment of this Agreement. No material term of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of a material term of
this Agreement shall be effective with respect to a Fund, until approved by
Vote of a Majority of the Outstanding Voting Securities of that Fund.
11. Representations and Warranties. The [Investment Adviser] [Investment
Subadviser] hereby represents and warrants as follows:
(a) [The [Investment Adviser] [Investment Subadviser] is exempt from
registration under the 1940 Act:]
(b) The [Investment Adviser] [Investment Subadviser] has all requisite
authority to enter into, execute, deliver and perform its obligations un-
der this Agreement;
(c) This Agreement is legal, valid and binding, and enforceable in ac-
cordance with its terms; and
(d) The performance by the [Investment Adviser] [Investment
Subadviser] of its obligations under this Agreement does not conflict with
any law to which it is subject.
12. Covenants. The [Investment Adviser] [Investment Subadviser] hereby
covenants and agrees that, so long as this Agreement shall remain in effect:
(a) The [Investment Adviser] [Investment Subadviser] shall remain ei-
ther exempt from, or registered under, the registration provisions of the
Advisers Act; and
(b) The performance by the [Investment Adviser] [Investment
Subadviser] of its obligations under this Agreement shall not conflict
with any law to which it is then subject.
EX-6
<PAGE>
13. Notices. Any notice required to be given pursuant to this Agreement
shall be deemed duly given if delivered or mailed by registered mail, postage
prepaid, (a) to the Investment Adviser, Mutual Funds Services, 130 Liberty
Street (One Bankers Trust Plaza), New York, New York 10006 , [(b) to the
Subadviser, [Address] or ](c) to the Trust, c/o BT Alex. Brown, Incorporated,
One South Street, Baltimore, Maryland 21202.
14. Waiver. With full knowledge of the circumstances and the effect of its
action, the [Investment Adviser] [Investment Subadviser] hereby waives any and
all rights which it may acquire in the future against the property of any in-
vestor in a Fund, other than shares in that Fund, which arise out of any ac-
tion or inaction of the [Trust] [Investment Adviser] under this Agreement.
15. Miscellaneous. The captions in this Agreement are included for conve-
nience of reference only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect. If any provision of
this Agreement shall be held or made invalid by a court decision, statute,
rule or otherwise, the remainder of this Agreement shall not be affected
thereby.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed by the
laws of the , without reference to principles of conflicts of
law. The Trust is organized under the laws of pursuant to a
dated . No Trustee, officer or employee of the Trust shall be person-
ally bound by or liable hereunder, nor shall resort be had to their private
property for the satisfaction of any obligation or claim hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
[SIGNATORIES]
EX-7
<PAGE>
EXHIBIT A
TO
INVESTMENT ADVISORY AGREEMENT
MADE AS OF
BETWEEN
[Trust Name] AND [ ]
Fund Investment Advisory Fee
- ---- -----------------------
EX-8
<PAGE>
CUSIP #055847206
CUSIP #055847107
CUSIP #055847834
CUSIP #055847842
CUSIP #055847826
CUSIP #055847818
CUSIP #055922751
<PAGE>
FORM OF PROXY CARD
[BANKERS TRUST LOGO]
DEUTSCHE BANC ALEX. BROWN
MUTUAL FUND SERVICES
MS 1-18-8
One South Street
Baltimore, Maryland 21202-3220
BT Pyramid Mutual Funds
BT Investment Equity Appreciation Fund
One South Street
Baltimore, Maryland 21202
PROXY FOR THE SPECIAL MEETING OF
STOCKHOLDERS
11:00 a.m., Eastern time, on October 8, 1999
The undersigned hereby appoints Daniel O. Hirsch
and Amy M. Olmert and each of them, with full power of
substitution, as proxies of the undersigned to vote all
shares of stock that the undersigned is entitled in any
capacity to vote at the above-stated special meeting,
and at any and all adjournments or postponements
thereof (the "Special Meeting"), on the matters set
forth on this Proxy Card, and, in their discretion,
upon all matters incident to the conduct of the Special
Meeting and upon such other matters as may properly be
brought before the Special Meeting. This proxy revokes
all prior proxies given by the undersigned.
All properly executed proxies will be voted as
directed. If no instructions are indicated on a
properly executed proxy, the proxy will be voted FOR
approval of Proposals IA, IB, IC, II and III. All
ABSTAIN votes will be counted in determining the
existence of a quorum at the Special Meeting and, for
Proposals IA, IB and IC, as votes AGAINST the
applicable Proposal.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
TRUSTEES WITH RESPECT TO YOUR FUND. THE BOARD OF
TRUSTEES RECOMMENDS A VOTE FOR PROPOSALS IA, IB, IC, II
AND III.
UNLESS VOTING BY TELEPHONE OR INTERNET, PLEASE
SIGN AND DATE BELOW AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
To vote by Telephone
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Call 1-800-690-6903.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
To vote by Internet
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Go to Website www.proxyvote.com.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
DO NOT RETURN YOUR PROXY CARD IF YOU VOTE BY
PHONE OR INTERNET.
TO VOTE, MARK BLOCKS IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS.
<PAGE>
DETACH AND RETURN THIS PORTION ONLY.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
BT INVESTMENT EQUITY APPRECIATION FUND
YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE AND MAIL THIS PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
(Joint owners should EACH sign. Please sign EXACTLY as your name(s) appears on
this card. When signing as attorney, trustee, executor, administrator, guardian
or corporate officer, please give your FULL title below.)
Vote on Trustees
<TABLE>
<S> <C> <C> <C>
II. Election of Messrs. (01) Biggar, For All Withhold All For All Except: To withhold authority
(02) Dill, (03) Hale, (04) Langton, to vote, mark "For All
(05) Saunders, and (06) Van Benschoten Except" and write the
and Drs. (07) Gruber and (08) Herring nominee's number on the
as Trustees of the Board. line below
------------------------
Vote on Proposals
IA. Approval of New Investment FOR AGAINST ABSTAIN III. Ratification of
Advisory Agreement with the selection
Bankers Trust Company of PricewaterhouseCoopers
LLP as the
independent
accountants of
IB. Approval of New Investment FOR AGAINST ABSTAIN the Fund. FOR[] AGAINST[] ABSTAIN []
Advisory Agreement with
Morgan Grenfell Inc.
IC. Approval of FOR AGAINST ABSTAIN The appointed proxies will vote on any
New Investment other business as may properly come before
Sub-advisory the Special Meeting or any adjournment thereof.
Agreement with
Bankers Trust Receipt of the Notice and the Joint Proxy Statement
Company is hereby acknowledged.
- ---------------------------------- -------------------------------
- ---------------------------------- -------------------------------
Signature (Please sign Signature (Joint
within box) Date Owners) Date
</TABLE>
<PAGE>
FORM OF PROXY CARD
[BANKERS TRUST LOGO]
DEUTSCHE BANC ALEX. BROWN
MUTUAL FUND SERVICES
MS 1-18-8
One South Street
Baltimore, Maryland 21202-3220
BT Pyramid Mutual Funds
BT Investment Money Market Fund
One South Street
Baltimore, Maryland 21202
PROXY FOR THE SPECIAL MEETING OF
STOCKHOLDERS
11:00 a.m., Eastern time, on October 8, 1999
The undersigned hereby appoints Daniel O. Hirsch
and Amy M. Olmert and each of them, with full power of
substitution, as proxies of the undersigned to vote all
shares of stock that the undersigned is entitled in any
capacity to vote at the above-stated special meeting,
and at any and all adjournments or postponements
thereof (the "Special Meeting"), on the matters set
forth on this Proxy Card, and, in their discretion,
upon all matters incident to the conduct of the Special
Meeting and upon such other matters as may properly be
brought before the Special Meeting. This proxy revokes
all prior proxies given by the undersigned.
All properly executed proxies will be voted as
directed. If no instructions are indicated on a
properly executed proxy, the proxy will be voted FOR
approval of Proposals IA, IB, IC, II and III. All
ABSTAIN votes will be counted in determining the
existence of a quorum at the Special Meeting and, for
Proposals IA, IB and IC, as votes AGAINST the
applicable Proposal.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
TRUSTEES WITH RESPECT TO YOUR FUND. THE BOARD OF
TRUSTEES RECOMMENDS A VOTE FOR PROPOSALS IA, IB, IC, II
AND III.
UNLESS VOTING BY TELEPHONE OR INTERNET, PLEASE
SIGN AND DATE BELOW AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
To vote by Telephone
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Call 1-800-690-6903.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
To vote by Internet
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Go to Website www.proxyvote.com.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
DO NOT RETURN YOUR PROXY CARD IF YOU VOTE BY
PHONE OR INTERNET.
TO VOTE, MARK BLOCKS IN BLUE OR BLACK INK AS
FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS.
8
<PAGE>
DETACH AND RETURN THIS PORTION ONLY.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
BT INVESTMENT MONEY MARKET FUND
YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE AND MAIL THIS PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
(Joint owners should EACH sign. Please sign EXACTLY as your name(s) appears on
this card. When signing as attorney, trustee, executor, administrator, guardian
or corporate officer, please give your FULL title below.)
Vote on Trustees
<TABLE>
<S> <C>
II. Election of Messrs. (01) Biggar, For Withhold All For Except: To withhold
(02) Dill, (03) Hale, (04) Langton, authority
(05) Saunders, and (06) Van Benschoten to vote, mark
and Drs. (07) Gruber and (08) Herring "For All
as Trustees of the Board. Except" and
write the
nominee's
number on the
line below.
---------------------
Vote on Proposals
IA. Approval of III. Ratification of
New Investment Advisory the selection of
Agreement with PricewaterhouseCoopers
Bankers Trust Company FOR AGAINST ABSTAIN LLP as the independent accountants
of the Fund. FOR[] AGAINST [] ABSTAIN []
IB. Approval of
New Investment
Advisory
Agreement with
Morgan Grenfell FOR AGAINST ABSTAIN The appointed proxies will vote on any
Inc. other business as may properly come before
the Special Meeting or any adjournment thereof.
IC. Approval of Receipt of the Notice and the Joint Proxy Statement
New Investment is hereby acknowledged.
Sub-advisory
Agreement with
Bankers Trust FOR AGAINST ABSTAIN
Company
- ---------------------------------- -------------------------------
- ---------------------------------- -------------------------------
Signature (Please sign Signature (Joint
within box) Date Owners) Date
</TABLE>
<PAGE>
FORM OF PROXY CARD
[BANKERS TRUST LOGO]
DEUTSCHE BANC ALEX. BROWN
MUTUAL FUND SERVICES
MS 1-18-8
One South Street
Baltimore, Maryland 21202-3220
BT Pyramid Mutual Funds
BT Investment Equity 500 Index Fund
One South Street
Baltimore, Maryland 21202
PROXY FOR THE SPECIAL MEETING OF
STOCKHOLDERS
11:00 a.m., Eastern time, on October 8, 1999
The undersigned hereby appoints Daniel O. Hirsch
and Amy M. Olmert and each of them, with full power of
substitution, as proxies of the undersigned to vote all
shares of stock that the undersigned is entitled in any
capacity to vote at the above-stated special meeting,
and at any and all adjournments or postponements
thereof (the "Special Meeting"), on the matters set
forth on this Proxy Card, and, in their discretion,
upon all matters incident to the conduct of the Special
Meeting and upon such other matters as may properly be
brought before the Special Meeting. This proxy revokes
all prior proxies given by the undersigned.
All properly executed proxies will be voted as
directed. If no instructions are indicated on a
properly executed proxy, the proxy will be voted FOR
approval of Proposals IA, IB, IC, II and III. All
ABSTAIN votes will be counted in determining the
existence of a quorum at the Special Meeting and, for
Proposals IA, IB and IC, as votes AGAINST the
applicable Proposal.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
TRUSTEES WITH RESPECT TO YOUR FUND. THE BOARD OF
TRUSTEES RECOMMENDS A VOTE FOR PROPOSALS IA, IB, IC, II
AND III.
UNLESS VOTING BY TELEPHONE OR INTERNET, PLEASE
SIGN AND DATE BELOW AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
To vote by Telephone
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Call 1-800-690-6903.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
To vote by Internet
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Go to Website www.proxyvote.com.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
DO NOT RETURN YOUR PROXY CARD IF YOU VOTE BY
PHONE OR INTERNET.
TO VOTE, MARK BLOCKS IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS.
<PAGE>
DETACH AND RETURN THIS PORTION ONLY.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
BT INVESTMENT EQUITY 500 INDEX FUND
YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE AND MAIL THIS PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
(Joint owners should EACH sign. Please sign EXACTLY as your name(s) appears on
this card. When signing as attorney, trustee, executor, administrator, guardian
or corporate officer, please give your FULL title below.)
Vote on Trustees
<TABLE>
<S> <C>
II. Election of Messrs. (01) Biggar, For All Withhold All For All Except: To withhold
(02) Dill, (03) Hale, (04) Langton, authority
(05) Saunders, and (06) Van Benschoten to vote, mark
and Drs. (07) Gruber and (08) Herring "For All
as Trustees of the Boards. Except" and
write the
nominee's
number on the
line below.
---------------
Vote on Proposals
IA. Approval of III. Ratification of the selection
New Investment of PricewaterhouseCoopers
Advisory LLP as the independent accountants of
Agreement with the Fund and its corresponding
Bankers Trust FOR AGAINST ABSTAIN Portfolio. FOR [] AGAINST [] ABSTAIN []
Company
IB. Approval of FOR AGAINST ABSTAIN The appointed proxies will vote on any
New Investment other business as may properly come before
Advisory the Special Meeting or any adjournment thereof.
Agreement with
Morgan Grenfell
Inc. Receipt of the Notice and the Joint Proxy
Statement is hereby acknowledged.
IC. Approval of FOR AGAINST ABSTAIN
New Investment
Sub-advisory
Agreement with
Bankers Trust
Company
- ---------------------------------- -------------------------------
- ---------------------------------- -------------------------------
Signature (Please sign Signature (Joint
within box) Date Owners) Date
</TABLE>
<PAGE>
FORM OF PROXY CARD
[BANKERS TRUST LOGO]
DEUTSCHE BANC ALEX. BROWN
MUTUAL FUND SERVICES
MS 1-18-8
One South Street
Baltimore, Maryland 21202-3220
BT Pyramid Mutual Funds
BT PreservationPlus Fund
One South Street
Baltimore, Maryland 21202
PROXY FOR THE SPECIAL MEETING OF
STOCKHOLDERS
11:00 a.m., Eastern time, on October 8, 1999
The undersigned hereby appoints Daniel O. Hirsch
and Amy M. Olmert and each of them, with full power of
substitution, as proxies of the undersigned to vote all
shares of stock that the undersigned is entitled in any
capacity to vote at the above-stated special meeting,
and at any and all adjournments or postponements
thereof (the "Special Meeting"), on the matters set
forth on this Proxy Card, and, in their discretion,
upon all matters incident to the conduct of the Special
Meeting and upon such other matters as may properly be
brought before the Special Meeting. This proxy revokes
all prior proxies given by the undersigned.
All properly executed proxies will be voted as
directed. If no instructions are indicated on a
properly executed proxy, the proxy will be voted FOR
approval of Proposals IA, IB, IC, II and III. All
ABSTAIN votes will be counted in determining the
existence of a quorum at the Special Meeting and, for
Proposals IA, IB and IC, as votes AGAINST the
applicable Proposal.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
TRUSTEES WITH RESPECT TO YOUR FUND. THE BOARD OF
TRUSTEES RECOMMENDS A VOTE FOR PROPOSALS IA, IB, IC, II
AND III.
UNLESS VOTING BY TELEPHONE OR INTERNET, PLEASE
SIGN AND DATE BELOW AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
To vote by Telephone
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Call 1-800-690-6903.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
To vote by Internet
1) Read the Proxy Statement and have the Proxy card below at hand.
2) Go to Website www.proxyvote.com.
3) Enter the 12-digit control number set
forth on the Proxy card and follow the
simple instructions.
DO NOT RETURN YOUR PROXY CARD IF YOU VOTE BY
PHONE OR INTERNET.
TO VOTE, MARK BLOCKS IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS.
<PAGE>
DETACH AND RETURN THIS PORTION ONLY.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
BT PRESERVATIONPLUS FUND
YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE AND MAIL THIS PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
(Joint owners should EACH sign. Please sign EXACTLY as your name(s) appears on
this card. When signing as attorney, trustee, executor, administrator, guardian
or corporate officer, please give your FULL title below.)
<TABLE>
<S> <C>
Vote on Trustees For All Withhold All For All Except: To withhold
authority
II. Election of Messrs. (01) Biggar, to vote, mark
(02) Dill, (03) Hale, (04) Langton, "For All
(05) Saunders, and (06) Van Benschoten Except" and
and Drs. (07) Gruber and (08) Herring write the
as Trustees of the Boards. nominee's
number on the
line below.
-----------------------------
Vote on Proposals
IA. Approval of III. Ratification of
New Investment the selection
Advisory of Ernst &
Agreement with Young LLP as
Bankers Trust the independent
Company FOR AGAINST ABSTAIN accountants of
the Fund and its
corresponding
Portfolio. FOR [] AGAINAST [] ABSTAIN []
IB. Approval of The appointed proxies will vote on any
New Investment other business as may properly come before
Advisory the Special Meeting or any adjournment thereof.
Agreement with
Morgan Grenfell FOR AGAINST ABSTAIN
Inc. Receipt of the Notice and the Joint Proxy
Statement, dated August 23 is hereby acknowledged.
IC. Approval of FOR AGAINST ABSTAIN
New Investment
Sub-advisory
Agreement with
Bankers Trust
Company
- ---------------------------------- -------------------------------
- ---------------------------------- -------------------------------
Signature (Please sign Signature (Joint
within box) Date Owners) Date
</TABLE>
