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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934.
Filed by the Registrant[x]
Filed by a Party other than the Registrant[ ]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
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HERITAGE SERIES TRUST
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Payment of Filing Fee (Check the appropriate box):
[x] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-
6(j)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
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4) Proposed maximum aggregate value of transaction:
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5) Total Fee Paid:
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[ ] 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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Preliminary copy for
the information of
the Securities and
Exchange Commission;
File No. 33-57986;
Rule 14a-6
HERITAGE SERIES TRUST - SMALL CAP STOCK FUND
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
August 7, 1995
To the Shareholders:
A Special Meeting of the holders of shares of beneficial
interest of the Heritage Series Trust - Small Cap Stock Fund (the "Fund")
will be held at 8:30 a.m. Eastern time, on the 7th day of August, 1995, at
880 Carillon Parkway, Classroom A, St. Petersburg, FL 33716, or any
adjournment(s) thereof, for the following purposes:
(1) To approve the Investment Subadvisory Agreement between
Heritage Asset Management, Inc. and Eagle Asset
Management, Inc.;
(2) To transact such other business as may properly come
before the Special Meeting or any adjournment(s) thereof.
You will be entitled to vote at the meeting and any
adjournment(s) thereof if you owned shares of the Fund at the close of
business on May 31, 1995. If you attend the meeting, you may vote your
shares in person. If you do not expect to attend the meeting, please
complete, date, sign and return the enclosed proxy card in the enclosed
postage paid envelope.
By Order of the Board of Trustees,
CLIFFORD J. ALEXANDER
Secretary
June 9, 1995
880 Carillon Parkway
St. Petersburg, Florida 33716
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YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy
form, date and sign the form, and return the form in the envelope
provided. If you sign, date and return the proxy form but give no voting
instructions, your shares will be voted "FOR" the proposals noticed above.
In order to avoid the additional expense of further solicitation, we ask
your cooperation in mailing your proxy card promptly. Unless proxy cards
submitted by corporations and partnerships are signed by the appropriate
persons as indicated in the voting instructions on the proxy card, they
will not be voted.
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HERITAGE SERIES TRUST - SMALL CAP STOCK FUND
880 Carillon Parkway
St. Petersburg, Florida 33716
PROXY STATEMENT
INTRODUCTION
This is a proxy statement with respect to Heritage Series Trust
(the "Trust") - Small Cap Stock Fund (the "Fund"), in connection with the
solicitation of proxies made by, and on behalf of, the Trust's Board of
Trustees, to be used at the Fund's special meeting of shareholders or any
adjournment(s) thereof ("Meeting"). This proxy statement will first be
mailed to shareholders on or about June 9, 1995.
A majority of the shares of the Fund outstanding on May 31, 1995
("Record Date") represented in person or by proxy, must be present for the
transaction of business at the Meeting. Only holders of securities as of
this date are entitled to notice of and to vote at the Meeting. In the
absence of a quorum or in the event that a quorum is present at the
Meeting but votes sufficient to approve any one of the Proposals are not
received, the persons named as proxies may propose one or more
adjournments of the Meeting to permit the further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of
those shares represented at the Meeting in person or by proxy. If a
quorum is present, the persons named as proxies will vote those proxies
that they are entitled to vote FOR such Proposal in favor of an
adjournment and will vote those proxies required to be voted AGAINST such
Proposal against such adjournment. A shareholder vote may be taken on one
or more of the Proposals described in this Proxy Statement prior to any
such adjournment if sufficient votes have been received and it is
otherwise appropriate. A majority of the outstanding Shares of the Fund
shall constitute a quorum.
Broker non-votes are shares held in street name for which the
broker indicates that instructions have not been received from the
beneficial owners or persons entitled to vote and the broker does not have
discretionary voting power. Abstentions and broker non-votes will be
counted for purposes of determining whether a quorum is present, but will
not be voted for or against any adjournment. Accordingly, abstentions and
broker non-votes effectively will be a vote against adjournment or against
the proposal where the required vote is a percentage of the shares
present. Abstentions and broker non-votes will not be counted, however,
as votes cast for purposes of determining whether sufficient votes have
been received to approve a proposal.
The individuals named as proxies in the enclosed proxy card will
vote in accordance with your directions as indicated thereon if your proxy
card is received properly executed. If you give no voting instructions
your shares will be voted in favor of the Proposals described in this
proxy statement. The duly appointed proxies may, in their discretion,
vote upon such other matters as may properly come before the Meeting.
Your proxy card may be revoked by giving another proxy, by letter or
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telegram revoking your proxy if received by the Fund prior to the Meeting,
or by appearing and voting at the Meeting.
As of May 31, 1995, the Fund had _________ shares outstanding and
_________________ held of record or owned beneficially more than 5% of the
outstanding shares of the Fund. All costs associated with the Meeting,
including the solicitation of proxies, will be borne by Eagle Asset
Management, Inc. ("Eagle"). Solicitations will be made primarily by mail
but also may include telephone communications by regular employees of
Heritage Asset Management, Inc. ("Heritage"), the Fund's investment
adviser and administrator, who will not receive any compensation therefor
from the Fund. Each full Share of the Fund is entitled to one vote, and
each fractional Share is entitled to a proportionate share of one vote.
You may obtain a copy of the Fund's most recent annual report to
shareholders, free of charge, by writing to Heritage at 880 Carillon
Parkway, St. Petersburg, Florida 33716 or by calling 1-800-421-4184.
PROPOSAL 1. APPROVAL OF THE INVESTMENT SUBADVISORY AGREEMENT
The Fund's assets currently are allocated among two investment
subadvisers, the Research Department of Raymond James & Associates, Inc.
("Research") and Awad & Associates ("Awad"), each a separate division of
Raymond James & Associates ("RJA"), which is an affiliate of Heritage.
Both RJA and Heritage are wholly owned subsidiaries of Raymond James
Financial, Inc. ("RJF"). Heritage believes short-term volatility may be
reduced by allocating the Fund's assets among multiple subadvisers. While
each subadviser to the Fund focuses on investments in small capitalization
companies, the different disciplines employed by different subadvisers may
cause the portion of the Fund allocated to a subadviser to have better or
worse relative performance than other portions during certain market
conditions. By employing multiple disciplines, Heritage believes that
short-term volatility may be reduced while the Fund participates in
returns available from small capitalization companies.
The Trust is proposing the addition of a third subadviser, Eagle,
an affiliate of both RJA and Heritage. If shareholders approve Eagle's
appointment as subadviser, Eagle will provide portfolio management
services based on the same subadvisory fee that each of the Fund's current
subadvisers receives.
Heritage intends to allocate the assets currently managed by
Research to Eagle. Eagle will follow an investment discipline similar to
that employed by Research in that Eagle will invest primarily in the "Buy
1" recommendations from the Research Register. The Research Register is
developed by Research and rates stocks from Strong Buy "Buy 1" to Sell
"5." The assets managed by Eagle will not be invested in direct
proportion to the Buy 1 stocks, as some of these stocks may not be small
capitalization companies, or otherwise may be unsuitable for the Fund.
The proportion of assets allocated to each subadviser will be
reviewed periodically by Heritage. The assets of the Fund may be
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reallocated between the subadvisers at Heritage's discretion, subject to
the oversight of the Board of Trustees, when Heritage deems such
reallocation in the best interests of the Fund's shareholders.
At their May 8, 1995 meeting, the Members of the Board of
Trustees unanimously approved the appointment of Eagle as an investment
subadviser to the Fund and the proposed subadvisory agreement between
Heritage and Eagle ("Eagle Agreement"). These decisions included the
unanimous approval of all Trustees who are not "interested persons" of the
Trust, Heritage, or Eagle as that term is defined in the Investment
Company Act of 1940, as amended ("Independent Trustees").
Description of the Subadvisory Agreement
The Eagle Agreement will be substantially similar to the current
subadvisory agreements between Heritage and Research and Heritage and
Awad. Eagle will manage the investment of Fund assets allocated to it,
and will be responsible for placing orders for the purchase and sale of
portfolio securities for the portion of the portfolio for which it is
responsible, subject to the supervision of the Trustees and Heritage. As
compensation for Eagle's services and for expenses borne by Eagle under
the Agreement, Eagle will be paid monthly by Heritage (not by the Fund) at
an annual rate equal to .50% of the Fund's average daily net assets under
its management.
The Eagle Agreement provides that Eagle will not be liable for
any error of judgment or mistake of law or for any loss suffered by the
Fund in connection with the performance of the Agreement, except a loss
resulting from willful misfeasance, bad faith or gross negligence on its
part in the performance of its duties or from reckless disregard by it of
its obligations and duties under the Subadvisory Agreement.
If approved by shareholders, the Eagle Agreement would be
executed promptly by Heritage and Eagle. Unless sooner terminated, it
would remain in effect for two years following its effective date.
Thereafter, it would continue automatically for successive annual periods,
provided that it is specifically approved at least annually (1) by a vote
of a majority of the Independent Trustees and (2) by all Trustees or by a
vote of a majority of the outstanding shares of the Fund. The Fund may
terminate the proposed Eagle Agreement by a vote of a majority of its
Trustees or a majority of its outstanding voting securities on 60 days'
written notice to Heritage or Eagle. Heritage may at any time terminate
that agreement upon 60 days' written notice to Eagle. Eagle may at any
time terminate that agreement upon 90 days' written notice to Heritage.
The agreement automatically will terminate without penalty in the event of
assignment or termination of the Advisory Agreement.
Information about Eagle
Eagle is a registered investment adviser that was organized in
1976. Eagle provides investment advisory services to a diverse group of
clients including individuals and institutional clients, such as employee
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benefit plans, endowments, foundations, other tax-exempt funds and
registered investment companies. Eagle advised approximately $___ billion
for these clients as of March 31, 1995.
In addition to advising private accounts, Eagle acts as
investment adviser to Eagle International Equity Portfolio of Heritage
Series Trust, investment subadviser to mutual funds, including Heritage
Income-Growth Trust, the Diversified Portfolio of Heritage Income Trust
and the Value Equity Fund, a series of Heritage Series Trust, and two
variable annuity portfolios (Eagle Growth Equity Portfolio for American
Skandia and Eagle Value Equity Portfolio for Golden Select). Eagle is a
wholly-owned subsidiary of RJF, which together with its subsidiaries,
provides a wide range of financial services to retail and institutional
clients.
The principal address of Eagle and each of its directors and
principal executive officer is 880 Carillon Parkway, St. Petersburg,
Florida 33716. The directors and principal executive officer of Eagle
are: Thomas A. James, Director and Chief Executive Officer, Stephen G.
Hill, Director and Richard K. Riess, Director and President.
Recommendation of the Board of Trustees
In approving the Eagle Agreement, the Board analyzed the factors
it deemed relevant, including: the services provided by Eagle to its
other clients; the ability of Eagle to provide services to the Fund; its
personnel, operations, financial condition; its proposed fee schedule; and
other factors that would affect positively or negatively the provision of
portfolio management services.
The Board also considered the experience of the proposed
portfolio manager for the Fund, Mr. Bert L. Boksen, Senior Vice President
of Eagle. For over 17 years, Mr. Boksen was employed by RJA in its
institutional research and sales department. While employed by RJA Mr.
Boksen served as co-head of Research and as Chairman of the RJA Focus List
Committee.
The Board also considered Eagle's policy of selecting brokers on
the basis of research or other services provided only when such use is
consistent with best available price and most favorable execution. The
Board realizes that research services furnished by brokers through which
the Fund effects securities transactions may be used by Eagle in advising
other accounts that it advises. Conversely, research services furnished
to Eagle in connection with other accounts Eagle advised may be used by
Eagle in advising the Fund. Information and research received from
brokers will be in addition to, and not in lieu of, the services required
to be performed by Eagle under the Eagle Agreement.
If Proposal 1 is not approved by shareholders, Heritage will
continue as the Fund's investment adviser and Research and Awad will
continue as the Fund's subadvisers. The Trustees would then consider
whether any other arrangements for the provision of investment subadvisory
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services are appropriate and in the best interests of the Trust's
shareholders.
Vote Required
Approval of Proposal 1 requires the affirmative vote of the
holders of the lesser of (1) 67% or more of the Shares of the Fund present
at the Meeting, if the holders of more than 50% of the outstanding Fund
Shares are present or represented by proxy at the Meeting, or (2) more
than 50% of the outstanding Shares of the Fund entitled to vote at the
Meeting.
THE BOARD OF TRUSTEES
RECOMMENDS THAT YOU VOTE FOR PROPOSAL 1.
INFORMATION ABOUT THE FUND
Current Advisory Arrangements
Heritage is a Florida corporation organized in 1985 and
registered as an investment adviser under the Investment Advisers Act of
1940, as amended. Heritage serves as investment adviser and administrator
to the Fund pursuant to an Investment Advisory and Administration
Agreement between Heritage and the Trust on behalf of the Fund, dated
March 29, 1993. Research and Awad serve as subadvisers to the Fund
pursuant to separate subadvisory agreements dated March 29, 1993 (the
"Subadvisory Agreements"). The Advisory and the Subadvisory Agreements
were each approved by the Fund's sole initial shareholder on March 29,
1993. All of the capital stock of Heritage is owned by RJF. Thomas A.
James, a Trustee of the Trust, by virtue of his direct or indirect
ownership of RJF, owns beneficially more than 10% of Heritage. RJF,
through its subsidiaries, is engaged primarily in providing customers with
a wide variety of financial services in connection with securities,
limited partnerships, options, investment banking and related fields.
Heritage also serves as investment adviser and manager to five other
investment companies with aggregate assets of approximately $1.6 billion
as of March 31, 1995.
The principal address of Heritage, RJF, Thomas A. James and each
of Heritage's directors and principal executive officer is at 880 Carillon
Parkway, St. Petersburg, Florida 33716. The directors and principal
executive officer of Heritage are: Jeffrey P. Julien, Director; Richard K.
Riess, Director; and Stephen G. Hill, Director, President and Chief
Executive Officer.
Under the Advisory Agreement, and subject to the supervision of
the Trustees, Heritage has agreed, among other duties, to provide a
continuous investment program for the Fund's portfolio, supervise all
aspects of the Fund's operation and hold itself available to respond to
shareholder inquiries. The Advisory Agreement expressly permits advisory
services to be delegated to and performed by a subadviser. Under the
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Advisory Agreement, the Fund bears all of its expenses not specifically
assumed by Heritage incurred in its operation and the offering of shares.
As required by state regulations, Heritage will reimburse the Fund if and
to the extent that the aggregate operating expenses of the Fund in any
fiscal year exceed applicable limits. To date, no such reimbursements
have been required.
For services provided under the Advisory Agreement, the Fund pays
Heritage an annualized advisory fee, computed daily and paid monthly, of
1.00% of the Fund's average daily net assets up to $50 million and .75% of
daily net assets over $50 million. During any period that Class A
expenses exceed 2.00% of average daily net assets, or Class C expenses
exceed 2.75%, Heritage will waive management fees as necessary to limit
Fund expenses to these levels. During the fiscal year ended October 31,
1994, the Fund paid (or accrued) to Heritage fees of approximately
$416,788.
Heritage is also the fund accountant and transfer and dividend
disbursing agent for the Fund. For the fiscal year ended October 31,
1994, the Fund paid Heritage approximately $44,240 for its services as
transfer and dividend disbursing agent. For the period May 14, 1994
(commencement of engagement as fund accountant) to October 31, 1994, the
Fund paid Heritage approximately $12,775 for its services as fund
accountant. Heritage will continue to provide these services to the Fund
after the advisory contract is approved.
In addition, an affiliate of Heritage, RJA, serves as the Trust's
principal underwriter. As compensation for certain distribution and
shareholder servicing activities, RJA was paid $100,506 pursuant to the
Trust's Rule 12b-1 distribution plan. RJA will continue to serve as
principal underwriter to the Trust after the advisory contract is
approved. The Fund does not currently execute any securities transactions
through RJA or any other affiliated broker-dealer.
The Advisory Agreement and the Subadvisory Agreements provide
that Heritage, Research and/or Awad, as applicable, will not be liable for
any error of judgment or mistake of law or for any loss suffered by the
Fund in connection with the matter to which the Agreements relate, except
a loss resulting from willful misfeasance, bad faith, or gross negligence
on their part in the performance of their duties or from reckless
disregard by them of their obligations and duties thereunder.
Executive Officers
Officers of the Fund who are employed by Heritage are:
Stephen G. Hill, President. Mr. Hill is a director and the Chief
Executive Officer and President of Heritage.
Donald H. Glassman, Treasurer. Mr. Glassman serves as Treasurer
of Heritage.
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Patricia Schneider, Secretary. Ms. Schneider serves as
Compliance Administrator of Heritage.
SHAREHOLDER PROPOSALS
As a general matter, the Fund does not hold regular annual or
other meetings of shareholders. Any shareholder who wishes to submit
proposals to be considered at a special meeting of the Fund's shareholders
should send such proposals to the Fund at 880 Carillon Parkway, St.
Petersburg, Florida 33733, so as to be received a reasonable time before
the proxy solicitation for that meeting is made.
Shareholder proposals that are submitted in a timely manner will
not necessarily be included in the Fund's proxy materials. Inclusion of
such proposals is subject to limitations under the federal securities
laws.
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OTHER BUSINESS
Management knows of no other business to be presented at the
Meeting other than the matter set forth in this Proxy Statement, but
should any other matter requiring a vote of shareholders arise, the
proxies will vote thereon according to their best judgment in the
interests of the Fund.
By Order of the Board of Trustees,
CLIFFORD J. ALEXANDER,
Secretary
It is important that you vote and return your proxy promptly.
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PROXY
HERITAGE SMALL CAP STOCK FUND
Special Meeting of Shareholders - August 7, 1995
The undersigned hereby appoints as proxies Stephen G. Hill, K.C. Clark and
Donald H. Glassman, each with the power of substitution, to vote for the
undersigned all shares of beneficial interest of the undersigned at the
aforementioned meeting and any adjournment thereof with all the power the
undersigned would have if personally present. The shares represented by
this proxy will be voted as instructed. Unless indicated to the contrary,
this proxy shall be deemed to indicate authority to vote "FOR" all
proposals. This proxy is solicited on behalf of the Board of Trustees.
Please date and sign this proxy and return it in the enclosed postage paid
envelope to: 880 Carillon Parkway, St. Petersburg, Florida 33716.
Please indicate your vote by placing an "X" in the appropriate box below.
The Board of Trustees recommends a vote "FOR"
Approval of the Investment Subadvisory Agreement between Heritage
Asset Management, Inc. and Eagle Asset Management, Inc.
FOR _______ AGAINST _______ ABSTAIN ______
This proxy will not be voted unless it is dated and signed exactly as
instructed below.
_______________________________________
Signature
Date:_______________________ ______________________________________
Signature 1
If shares are held jointly, each
shareholder named should sign; if
only one signs, his signature will be
binding. If the shareholder is a
corporation, the President or Vice
President should sign in her own
name, indicating title. If the
shareholder is a partnership, a
partner should sign in his own name,
indicating that he is a "Partner."
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