IMPORTANT NOTICE
PLEASE READ IMMEDIATELY
AQUILA
NARRAGANSETT INSURED TAX-FREE INCOME FUND
380 Madison Avenue, Suite 2300, New York, N.Y. 10017
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD
on NOVEMBER 13, 1998
TO OUR SHAREHOLDERS:
The purpose of this Notice is to advise you that an Annual Meeting
of the Shareholders of Narragansett Insured Tax-Free Income Fund
(the "Fund") will be held:
Place: (a) at the Rhode Island Convention Center
1 Sabin Street
Providence, Rhode Island
Time: (b) on November 13, 1998
at 2:30 p.m. local time;
Purposes: (c) for the following purposes:
(i) to elect six Trustees; each Trustee elected
will hold office until the next annual meeting of
the Fund's shareholders or until his or her
successor is duly elected;
(ii) to ratify (that is, to approve) or reject the
selection of KPMG Peat Marwick LLP as the Fund's
independent auditors for the fiscal year ending
June 30, 1999 (Proposal No. 1); and
PLEASE NOTE:
If you do not expect to attend the Meeting, you are requested to
indicate voting instructions on the enclosed proxy and to date,
sign and return it in the accompanying stamped envelope. To avoid
unnecessary expense to the Fund, your cooperation is requested in
mailing in your proxy no matter how large or small your holding may
be.
(iii) to act upon any other matters which may
properly come before the Meeting at the scheduled
time and place or any adjourned meeting or
meetings.
Who Can
Vote What
Shares: (d) To vote at the Meeting, you must have been a
shareholder on the Fund's records at the close of
business on August 17, 1998 (the "record date").
Also, the number of shares of each of the Fund's
three outstanding classes of shares that you held
at that time and the respective net asset values of
each class of shares at that time determine the
number of votes you may cast at the Meeting (or any
adjourned meeting or meetings).
By Order of the Board of Trustees,
EDWARD M. W. HINES
Secretary
September 25, 1998
<PAGE>
NARRAGANSETT INSURED TAX-FREE INCOME FUND
380 Madison Avenue, Suite 2300, New York, New York 10017
PROXY STATEMENT
INTRODUCTION
The purpose of the Notice (the first two pages of this
document) is to advise you of the time, place and purposes of an
Annual Meeting of the Shareholders of Narragansett Insured Tax-Free
Income Fund (the "Fund"). The purpose of this proxy statement (all
the remainder of this document) is to give you information on which
you may base your decisions as to the choices, if any, you make on
the enclosed proxy card.
A copy of the Fund's most recent annual report and most recent
semi-annual report will be sent to you without charge upon written
request to the Fund's Distributor, Aquila Distributors, Inc., 380
Madison Avenue, Suite 2300, New York, NY 10017 or by calling 800-
453-6864 toll-free or 212-697-6666.
The Fund's organizer and Manager (the "Manager") is Aquila
Management Corporation, 380 Madison Avenue, Suite 2300, New York,
NY 10017. The Fund's principal underwriter (the "Distributor") is
Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New
York, NY 10017. The Fund's Investment Sub-Adviser is Citizens Bank
of Rhode Island (the "Sub-Adviser"), One Citizens Plaza,
Providence, RI 02903.
This Notice and Proxy Statement are first being mailed on or
about September 25, 1998.
The enclosed proxy card authorizes the persons named (or their
substitutes) to vote your shares; the Fund calls these persons the
"proxy holders." As to the election of Trustees you may authorize
the proxy holders to vote your shares for the entire slate
indicated below by marking the appropriate box on the proxy card or
by merely signing and returning your proxy card with no
instructions. Or, you may withhold the authority of the proxy
holders to vote on the election of Trustees by marking the
appropriate box. Also, you may withhold that authority as to any
particular nominee by following the instructions on the proxy card.
As to the other matter listed on the proxy card, you may
direct the proxy holders to vote your shares on that proposal by
checking the appropriate box "For" or "Against" or instruct them
not to vote your shares on the proposal by checking the "Abstain"
box. If you return your signed proxy card and do not check any box
on the proposal, the proxy holders will vote your shares for the
proposal. Shares held by brokers in "street name" and not voted or
marked as abstentions will not be counted for purposes of
determining a quorum.
You may end the power of the proxy holders to vote your
shares, after you have signed and returned your proxy card but
before the power is used, by (i) so notifying the Fund in writing;
(ii) signing a new and different proxy card (if the Fund receives
it before the old one is used); or (iii) voting your shares at the
meeting in person or by your duly appointed agent.
The Fund is sending you this Notice and Proxy Statement in
connection with the solicitation by its Trustees of proxy cards
("proxies") to be used at the Annual Meeting to be held at the time
and place and for the purposes indicated in the Notice or any
adjourned meeting or meetings. The Fund pays the costs of the
solicitation. Proxies are being solicited by the use of the mails;
they may also be solicited by telephone, facsimile and personal
interviews. Brokerage firms, banks and others may be requested to
forward this Notice and Proxy Statement to beneficial owners of the
Fund's shares so that these owners may authorize the voting of
these shares. The Fund will pay these firms for their out-of-pocket
expenses for doing so.
On the record date the Fund had three classes of shares
outstanding. All shareholders of the Fund of all three classes are
entitled to vote at the meeting. Each shareholder on the record
date is entitled to one vote for each dollar (and a proportionate
fractional vote for each fraction of a dollar) of net asset value
(determined as of the record date) represented by full and
fractional shares of any class held on the record date. On the
record date the net asset value per share of each of the Fund's
classes of shares was as follows: Class A Shares, $ 10.49, Class C
Shares, $10.49 and Class Y Shares $10.49. The meeting is expected
to act only upon matters that affect the Fund as a whole: the
election of Trustees and the action on the selection of auditors
(Proposal No. 1). On matters that affect the Fund as a whole, all
shareholders of the Fund, including the shareholders of all classes
of the Fund, are entitled to vote at the meeting.
On the record date the total number of shares of the Fund of
each class outstanding and entitled to vote was as follows:
5,051,522 Class A Shares, 266,730 Class C Shares and 1,601 Class Y
Shares.
On the record date, National Financial Services Corp., 200
Liberty Street, New York, NY 10281 held of record 470,392 Class A
Shares (9.3% of the class); Merrill Lynch, Pierce, Fenner & Smith,
Inc., P.O. Box 30561, New Brunswick, NJ, held of record 405,973
Class A Shares (8.0% of the class) and 32,078 Class C Shares (12.0%
of the class); Corelink Financial Inc., P.O. Box 4054, Concord, CA
94524 held of record 574,536 Class A Shares (11.4% of the Class)
and 117,847 Class C Shares (44.2% of the Class); Donaldson Lufkin
Jenrette Securities Corporation, P.O. Box 2052, Jersey City, NJ
held of record 44,066 Class C Shares (16.5% of the class) and US
Clearing Corp., 26 Broadway New York, NY held of record 1,589 Class
Y Shares (99.2% of the class). On the basis of information received
from the holders, the Fund's management believes that all of the
shares indicated are held for the benefit of clients. Mark S.
Mandell, Park Row, Providence, RI held of record 24,216 Class C
Shares (9.1% of the class). The Fund's management is not aware of
any other person beneficially owning more than 5% of its
outstanding shares as of such date.
ELECTION OF TRUSTEES
At the Meeting, six Trustees are to be elected. Whenever it is
stated in this Proxy Statement that a matter is to be acted on at
the Meeting, this means the Meeting held at the scheduled time or
any adjourned meeting or meetings.
Each Trustee elected will serve until the next annual meeting
or until his or her successor is duly elected. The nominees
selected by the Trustees are named in the table below. See
"Introduction" above for information as to how you can instruct the
proxy holders as to the voting of your shares as to the election of
Trustees.
All of the nominees are presently Trustees and were elected by
the shareholders in November, 1997. Mr. Herrmann, Mr. Alden and Mr.
Nightingale have been Trustees since 1992, Mr. Weeks and Mr. Duffy,
since 1995 and Mr. Clinton, since 1996. The Trustees and officers
as a group own less than 1% of the outstanding shares of the Fund.
In the material below and elsewhere in this Proxy Statement, Aquila
Management Corporation, organizer and Manager of the Fund, is
referred to as the "Manager" and the Fund's Distributor, Aquila
Distributors, Inc., is referred to as the "Distributor." Mr.
Herrmann is an interested person of the Fund as that term is
defined in the Investment Company Act of 1940 (the "1940 Act") as
an officer of the Fund and a director, officer and shareholder of
the Manager and the Distributor. He is so designated by an
asterisk.
Described in the following material are the name, positions
with the Fund, age as of the record date and business experience
during at least the past five years (other than with the Fund) of
each nominee and all officers of the Fund. All shares listed as
owned by the Trustees are Class A Shares unless indicated
otherwise.
Lacy B. Herrmann*, President and Chairman of the Board of Trustees,
Age: 69, Shares Owned: 529 (1)
Founder and Chairman of the Board of Aquila Management Corporation
since 1984, the sponsoring organization and Manager or
Administrator and/or Adviser or Sub-Adviser to the following open-
end investment companies, and Founder, Chairman of the Board of
Trustees, and President of each: Hawaiian Tax-Free Trust since
1984; Tax-Free Trust of Arizona since 1986; Tax-Free Trust of
Oregon since 1986; Tax-Free Fund of Colorado since 1987; Churchill
Tax-Free Fund of Kentucky since 1987; and Tax-Free Fund For Utah
since 1992; each of which is a tax-free municipal bond fund, and
two equity funds, Aquila Rocky Mountain Equity Fund since 1993 and
Aquila Cascadia Equity Fund, since 1996, which, together with this
Fund are called the Aquila Bond and Equity Funds; Pacific Capital
Cash Assets Trust since 1984; Churchill Cash Reserves Trust since
1985; Pacific Capital U.S. Government Securities Cash Asset Trust
since 1988; Pacific Capital Tax-Free Cash Assets Trust since 1988;
each of which is a money market fund, and together with Capital
Cash Management Trust ("CCMT") are called the Aquila Money-Market
Funds; Vice President and Director, and formerly Secretary, of
Aquila Distributors, Inc. since 1981, distributor of the above
funds; President and Chairman of the Board of Trustees of CCMT, a
money market fund, since 1981, and an Officer and Trustee/Director
of its predecessors since 1974; Chairman of the Board of Trustees
and President of Prime Cash Fund (which is inactive) since 1982 and
of Short Term Asset Reserves 1984-1996; President and a Director of
STCM Management Company, Inc., sponsor and sub-adviser to CCMT;
Chairman, President, and a Director since 1984 of InCap Management
Corporation, formerly sub-adviser and administrator of Prime Cash
Fund and Short Term Asset Reserves, and Founder and Chairman of
several other money market funds; Director or Trustee of OCC Cash
Reserves, Inc. and Quest For Value Accumulation Trust, and Director
or Trustee of Oppenheimer Quest Value Fund, Inc., Oppenheimer Quest
Global Value Fund, Inc. and Oppenheimer Rochester Group of Funds,
each of which is an open-end investment company; Trustee of Brown
University, 1990-1996 and currently Trustee Emeritus; actively
involved for many years in leadership roles with university, school
and charitable organizations.
(1) Held of record by the Manager; in addition, the Manager holds
of record 11 Class C Shares and 11 Class Y Shares.
Vernon R. Alden, Trustee, Age: 75, Shares Owned: 214
Director of Sonesta International Hotels Corporation and
Independent General Partner of the Merrill Lynch-Lee Funds;
Former Director of Colgate-Palmolive Company, Digital Equipment
Corporation, Intermet Corporation, The McGraw Hill and The Mead
Corporation; Chairman of the Board and Executive Committee of The
Boston Company, Inc., a financial services company, 1969-1978;
Trustee of Tax-Free Trust of Oregon since 1988, of Hawaiian Tax-
Free Trust, Pacific Capital Cash Assets Trust, Pacific Capital Tax-
Free Cash Assets Trust and Pacific Capital U.S. Government
Securities Cash Assets Trust since 1989, of Cascades Cash Fund,
1989-1994 and of Aquila Cascadia Equity Fund since 1996; Associate
Dean and member of the faculty of Harvard University Graduate
School of Business Administration, 1951-1962; member of the faculty
and Program Director of Harvard Business School - University of
Hawaii Advanced Management Program, summer of 1959 and 1960;
President of Ohio University, 1962-1969; Chairman of The Japan
Society of Boston, Inc., and member of several Japan-related
advisory councils; Chairman of the Massachusetts Business
Development Council and the Massachusetts Foreign Business Council,
1978-1983; Trustee Emeritus, Boston Symphony Orchestra; Chairman of
the Massachusetts Council on the Arts and Humanities, 1972-1984;
Member of the Board of Fellows of Brown University, 1969-1986;
Trustee of various other cultural and educational organizations;
Honorary Consul General of the Royal Kingdom of Thailand; Received
Decorations from the Emperor of Japan (1986) and the King of
Thailand (1996 and 1997).
Paul Y. Clinton, Trustee, Age: 67, Shares Owned: 220
Principal of Clinton Management Associates, a financial and venture
capital consulting firm; formerly Director of External Affairs of
Kravco Corporation, a national real estate owner and developer,
1984-1995; formerly President of Essex Management Corporation, a
management and financial consulting company, 1979-1983; Trustee of
Capital Cash Management Trust since 1979 and of Prime Cash Fund
(which is inactive), since 1993; Trustee of Short Term Asset
Reserves 1984-1996; general partner of Capital Growth Fund, a
venture capital partnership, 1979-1982; President of Geneve Corp.,
a venture capital fund, 1970-1978; formerly Chairman of Woodland
Capital Corp., a small business investment company; formerly Vice
President, W.R. Grace & Co; Director or Trustee of OCC Cash
Reserves, Inc., Oppenheimer Quest Global Value Fund, Inc.,
Oppenheimer Quest Value Fund, Inc., and Trustee of Quest For Value
Accumulation Trust, and of the Rochester Group of Funds, each of
which is an open-end investment company.
David A. Duffy, Trustee, Age: 59, Shares Owned: 224 (2)
President, Duffy & Shanley, Inc., an advertising, marketing and
public relations firm since 1973; National Chairman of the National
Conference for Community and Justice (formerly the National
Conference of Christians and Jews); Vice Chairman of the Providence
College Board of Trustees and Chairman of the College's President's
Council; Past Chair and current member of the Executive Committee
of the Greater Providence Chamber of Commerce; past Chair of the
Rhode Island Sports Council; past Chair of the Rhode Island Public
Telecommunications Authority; and many other civic and non-profit
organizations. He has been the recipient of numerous awards for
public service. He served with the U.S. Army.
(2) Held of record by Duffy & Shanley Inc.
William J. Nightingale, Trustee, Age: 68, Shares Owned: 661
Chairman and founder (1975) and Senior Advisor since 1995 of
Nightingale & Associates, L.L.C., a general management consulting
firm focusing on interim management, divestitures, turnaround of
troubled companies, corporate restructuring and financial advisory
services; President, Chief Executive Officer and Director of Bali
Company, Inc., a manufacturer of women's apparel, which became a
subsidiary of Hanes Corporation, 1970-1975; prior to that, Vice
President and Chief Financial Officer of Hanes Corporation after
being Vice President-Corporate Development and Planning of that
company, 1968-1970; formerly Senior Associate of Booz, Allen &
Hamilton, management consultants, after having been Marketing
Manager with General Mills, Inc.; Trustee of Churchill Cash
Reserves Trust and Churchill Tax-Free Fund of Kentucky since 1993;
Director of Kasper A.S.L. Ltd.; Ring's End, Inc; Furr's/Bishop's
Inc.
J. William Weeks, Trustee, Age: 71, Shares Owned: 587
Trustee of Tax-Free Fund of Colorado since 1995; Senior Vice
President of Tax-Free Fund of Colorado and Narragansett Insured
Tax-Free Income Fund, 1992-1995; Vice President of Hawaiian Tax-
Free Trust, Tax-Free Trust of Arizona, Tax-Free Trust of Oregon and
Churchill Tax-Free Fund of Kentucky, 1990-1995; Senior Vice
President or Vice President of the Bond and Equity Funds and Vice
President of Short Term Asset Reserves and Pacific Capital Cash
Assets Trust, 1984-1988; President and Director of Weeks & Co.,
Inc., financial consultants, 1978-1988; limited partner and
investor in various real estate partnerships since 1988; Partner of
Alex. Brown & Sons, investment bankers, 1966-1976; Vice President
of Finance and Assistant to the President of Howard Johnson
Company, a restaurant and motor lodge chain, 1961-1966; formerly
with Blyth & Co., Inc., investment bankers.
Stephen J. Caridi, Vice President, Age: 37
Vice President of the Distributor since 1995, Assistant Vice
President, 1988-1995, Marketing Associate, 1986-1988; Assistant
Vice President of Tax-Free Fund For Utah since 1993; Mutual Funds
Coordinator of Prudential Bache Securities, 1984-1986; Account
Representative of Astoria Federal Savings and Loan Association,
1979-1984.
Diana P. Herrmann, Vice President, Age: 40
Trustee of Tax-Free Trust of Arizona and Tax-Free Trust of Oregon
since 1994, of Churchill Tax-Free Fund of Kentucky and Churchill
Cash Reserves Trust since 1995, of Aquila Cascadia Equity Fund
since 1996 and of Aquila Rocky Mountain Equity Fund and Tax-Free
Fund For Utah since 1997; and Capital Cash Management Trust since
1997; President and Chief Operating Officer of the Manager since
1997; Senior Vice President and Secretary, and formerly Vice
President, of the Manager since 1986 and Director since 1984;
Senior Vice President or Vice President and formerly Assistant Vice
President of the Aquila Money-Market Funds since 1986; Executive
Vice President, Senior Vice President or Vice President of the
Aquila Bond Funds and Vice President of the Aquila Equity Funds
since 1997; Vice President of InCap Management Corporation since
1986 and Director since 1983; Assistant Vice President of Oxford
Cash Management Fund, 1986-1988 and Prime Cash Fund 1986-1996;
Assistant Vice President and formerly Loan Officer of European
American Bank, 1981-1986; daughter of the Fund's President; Trustee
of the Leopold Schepp Foundation (academic scholarships) since
1995; actively involved in mutual fund and trade associations and
in college and other volunteer organizations.
William C. Wallace, Vice President, Age: 63
Vice President of Capital Cash Management Trust and Pacific Capital
Cash Assets Trust since 1984; Senior Vice President of Hawaiian
Tax-Free Trust since 1985 and Vice President, 1984-1985; Senior
Vice President of Tax-Free Trust of Arizona since 1989 and Vice
President, 1986-1988; Vice President of Tax-Free Trust of Oregon
since 1986, of Churchill Tax-Free Fund of Kentucky and Tax-Free
Fund of Colorado since 1987, of Pacific Capital Tax-Free Cash
Assets Trust and Pacific Capital U.S. Government Securities Cash
Assets Trust since 1988; Secretary and Director of STCM Management
Company, Inc. since 1974; President of the Distributor 1995-1998,
formerly Vice President of the Distributor, 1986-1992; Member of
the Panel of Arbitrators, American Arbitration Association, since
1978; Assistant Vice President, American Stock Exchange, Market
Development Division, and Director of Marketing, American Gold Coin
Exchange, a subsidiary of the American Stock Exchange, 1976-1984.
Rose F. Marotta, Chief Financial Officer, Age: 74
Chief Financial Officer of the Aquila Money-Market Funds and the
Aquila Bond and Equity Funds since 1991 and Treasurer, 1981-1991;
formerly Treasurer of the predecessor of CCMT; Treasurer and
Director of STCM Management Company, Inc., since 1974; Treasurer of
Trinity Liquid Assets Trust, 1982-1986 and of Oxford Cash
Management Fund, 1982-1988; Treasurer of InCap Management
Corporation since 1982, of the Manager since 1984 and of the
Distributor since 1985.
Richard F. West, Treasurer, Age: 62
Treasurer of the Aquila Money-Market Funds and the Aquila Bond and
Equity Funds and of Aquila Distributors, Inc. since 1992; Associate
Director of Furman Selz Incorporated, 1991-1992; Vice President of
Scudder, Stevens & Clark, Inc. and Treasurer of Scudder
Institutional Funds, 1989-1991; Vice President of Lazard Freres
Institutional Funds Group, Treasurer of Lazard Freres Group of
Investment Companies and HT Insight Funds, Inc., 1986-1988; Vice
President of Lehman Management Co., Inc. and Assistant Treasurer of
Lehman Money Market Funds, 1981-1985; Controller of Seligman Group
of Investment Companies, 1960-1980.
Edward M. W. Hines, Secretary, Age: 58
Partner of Hollyer Brady Smith Troxell Barrett Rockett Hines & Mone
LLP, attorneys, since 1989 and counsel, 1987-1989; Secretary of the
Aquila Money-Market Funds and the Aquila Bond and Equity Funds
since 1982; Secretary of Trinity Liquid Assets Trust, 1982-1985 and
Trustee of that Trust, 1985-1986; Secretary of Oxford Cash
Management Fund, 1982-1988.
John M. Herndon, Assistant Secretary, Age: 58
Assistant Secretary of the Aquila Money-Market Funds and the Aquila
Bond and Equity Funds since 1995 and Vice President of the Aquila
Money-Market Funds since 1990; Vice President of the Manager since
1990; Investment Services Consultant and Bank Services Executive of
Wright Investors' Service, a registered investment adviser, 1983-
1989; Member of the American Finance Association, the Western
Finance Association and the Society of Quantitative Analysts.
Patricia A. Craven, Assistant Secretary & Compliance Officer,
Age: 32
Assistant Secretary of the Aquila Money-Market Funds and the Aquila
Bond and Equity Funds since 1995; Counsel to the Manager and the
Distributor since 1995; Secretary of the Distributor since 1997;
formerly a Legal Associate for Oppenheimer Management Corporation,
1993-1995.
Compensation of Trustees
The Fund does not pay fees to Trustees affiliated with the
Manager or to any of the Fund's officers. During the fiscal year
ended June 30, 1998, the Fund paid $46,522 in fees and
reimbursement of expenses to its other Trustees. The Fund is one of
the 14 funds in the Aquilasm Group of Funds, which consist of tax-
free municipal bond funds, money market funds and two equity funds.
The following table lists the compensation of all Trustees who
received compensation from the Fund and the compensation they
received during the Fund's fiscal year from other funds in the
Aquilasm Group of Funds. None of such Trustees has any pension or
retirement benefits from the Fund or any of the other funds in the
Aquila group.
<TABLE>
<CAPTION>
Compensation Number of
from all funds boards on which
Compensation in the the Trustee
Name from the Fund Aquilasm Group now serves
<S> <C> <C> <C>
Vernon R. Alden $4,710 $52,514 7
Paul Y. Clinton $6,916 $9,422 2
David A. Duffy $5,520 $5,520 1
William J.
Nightingale $3,954 $17,431 3
J. William Weeks $6,276 $15,175 2
</TABLE>
The Manager is manager or administrator to the Aquilasm Group
of Funds which consists of tax-free municipal bond funds, money
market funds and equity funds. As of August 31, 1998, these funds
had aggregate assets of approximately $3.1 billion, of which
approximately $1.95 billion consisted of assets of the tax-free
municipal bond funds. The Manager is controlled by Mr. Lacy B.
Herrmann, through share ownership directly, through a trust and by
his wife. During the Fund's fiscal year ended June 30, 1998, the
Fund accrued fees for the Manager (including the fees it pays to
the Sub-Adviser) of $246,189, of which $221,568 was waived. In
addition, the Manager reimbursed the Fund for other expenses in the
amount of $195,380. Of this amount, $182,811 was paid prior to June
30, 1998 and the balance of $12,569 was paid in July, 1998. During
the fiscal year ended June 30, 1998, Permitted Payments of $72,087
were made to Qualified Recipients with respect to Class A Shares of
the Fund, of which the Distributor received $1,455. During the same
period, payments of $10,093 were made to Qualified Recipients with
respect to Class C Shares of the Fund under the Distribution Plan
and $3,364 under the Shareholder Services Plan. Of these payments
the Distributor received $11,301.
The Distributor currently handles the distribution of the
shares of fourteen funds (five money market funds, seven tax-free
municipal bond funds and two equity funds), including the Fund.
Under the Distribution Agreement, the Distributor is responsible
for the payment of certain printing and distribution costs relating
to prospectuses and reports as well as the costs of supplemental
sales literature, advertising and other promotional activities. At
the date of this proxy statement, there is a proposed transaction
whereby all of the shares of the Distributor, which are currently
owned 75% by Mr. Herrmann and 25% by Diana P. Herrmann, will be
owned by certain directors and/or officers of the Administrator
and/or the Distributor including Mr. Herrmann and Ms. Herrmann.
Other Information on Trustees
The Trustees have appointed an Audit Committee consisting of
all of the Trustees (the "Independent Trustees") who are not
"interested persons," of the Fund as that term is defined in the
1940 Act. The Committee (i) recommends to the Board of Trustees
what firm of independent auditors will be selected by the Board of
Trustees (subject to shareholder ratification); (ii) reviews the
methods, scope and result of audits and the fees charged; and (iii)
reviews the adequacy of the Fund's internal accounting procedures
and controls. The Committee held two meetings during the Fund's
last fiscal year. The Board of Trustees does not have a nominating
committee. During the Fund's last fiscal year, the Board of
Trustees held four meetings. All current Trustees were present for
at least 75% of the total number of Board meetings and Audit
Committee Meetings (if such Trustee was a member of that
Committee).
RATIFICATION OR REJECTION
OF SELECTION OF
INDEPENDENT AUDITORS
(Proposal No. 1)
KPMG Peat Marwick LLP, which is currently serving as the
Fund's auditors, has been selected by the Fund's Board of Trustees,
including a majority of the Independent Trustees, as the Fund's
independent auditors for the fiscal year ending June 30, 1999. Such
selection is submitted to the shareholders for ratification or
rejection.
The firm has no direct or indirect financial interest in the
Fund, the Fund's Manager or the Fund's Sub-Adviser. It is expected
that representatives of the firm will not be present at the meeting
but will be available should any matter arise requiring their
presence.
RECEIPT OF
SHAREHOLDER PROPOSALS
Under the proxy rules of the Securities and Exchange
Commission, shareholder proposals meeting tests contained in those
rules may, under certain conditions, be included in the Fund's
proxy statement and proxy card for a particular annual meeting. One
of these conditions relates to the timely receipt by the Fund of
any such proposal. Under these rules, proposals submitted for
inclusion in the proxy material for the Fund's next annual meeting
after the meeting to which this Proxy Statement relates must be
received by the Fund not less than 120 days before the anniversary
of the date stated in this Proxy Statement for the first mailing of
this Proxy Statement. The date for such submission could change,
depending on the scheduled date for the next annual meeting; if so,
the Fund will so advise you.
The fact that the Fund receives a shareholder proposal in a
timely manner does not insure its inclusion in the Fund's proxy
material, since there are other requirements in the proxy rules
relating to such inclusion.
OTHER BUSINESS
The Fund does not know of any other matter which will come up
for action at the Meeting. If any other matter or matters properly
come up for action at the Meeting, including any adjournment of the
Meeting, the proxy holders will vote the shares which the proxy
cards entitle them to vote in accordance with their judgment on
such matter or matters. That is, by signing and returning your
proxy card, you give the proxy holders discretionary authority as
to any such matter or matters.
<PAGE>
NARRAGANSETT INSURED TAX-FREE INCOME FUND
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 13, 1998
PROXY SOLICITED ON BEHALF OF THE TRUSTEES
The undersigned shareholder of Narragansett Insured Tax-Free
Income Fund (the "Fund") does hereby appoint LACY B. HERRMANN,
DIANA P. HERRMANN and EDWARD M. W. HINES, or any of them, as
attorneys and proxies of the undersigned, with full power of
substitution, to attend the Annual Meeting of Shareholders of
Narragansett Insured Tax-Free Income Fund to be held on November
13, 1998, at the Rhode Island Convention Center, 1 Sabin Street,
Providence, Rhode Island, at 2:30 p.m. local time, and at all
adjournments thereof, and thereat to vote the shares held in the
name of the undersigned on the record date for said meeting on the
matters listed below.
Please mark your proxy, date and sign it below and return it
promptly in the accompanying envelope which requires no postage if
mailed in the United States.
Management recommends a vote for all nominees listed below and
for the proposal listed below. The shares represented hereby will
be voted as indicated below or FOR if no choice is indicated.
As to any other matter said attorneys shall vote in accordance
with their best judgment.
Election of Trustees
__
[__] For All
__
[__] Withhold All
__
[__] For All Except
To withhold authority to vote, mark "For All Except" and write the
nominee's number on the line below.
---------------
(1) LACY B. HERRMANN; (2) VERNON R. ALDEN;
(3) PAUL Y. CLINTON; (4) DAVID A. DUFFY;
(5) WILLIAM J. NIGHTINGALE; (6) J. WILLIAM WEEKS
Vote On Proposal
Ratification of selection of KPMG Peat Marwick LLP as
independent auditors (Proposal No.1 in Proxy Statement)
__ __ __
FOR [__] AGAINST [__] ABSTAIN [__]
Please check here if planning to attend the Annual Meeting of
Shareholders.
__
[__]
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as
a custodian, attorney, executor, administrator, trustee, guardian,
etc., please sign your full title as such. Joint owners should
each sign.
__________________________________
Signature (PLEASE SIGN WITHIN BOX) Date
__________________________________
Signature (Joint Owners) Date
