<PAGE>
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:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
b(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
LORD ABBETT SECURITIES TRUST
(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):
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[X] 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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
LORD ABBETT SECURITIES TRUST
INVESTMENT MANAGEMENT
THE GM BUILDING 767 FIFTH AVENUE NEW YORK NEW YORK 10153
Dear Shareholder:
You are cordially invited to attend the Special Meeting of Shareholders
of Lord Abbett Securities Trust scheduled to be held on June 19, 1996, at 11:00
a.m., at the General Motors Building, 767 Fifth Avenue, New York, New York.
Your Board of Trustees looks forward to greeting those shareholders who are able
to attend.
At the meeting, in addition to the approval of the appointment of
auditors, you will be asked to vote on a proposed revision of your Series'
fundamental investment policies and restrictions and a new 12b-1 Plan and
Distribution Agreement for your Series.
Such proposals, if approved, are intended to provide for greater
flexibility in the future management of your Series' portfolio, as well as to
maintain the competitive position of the Fund.
All proposals are fully described in the enclosed proxy statement. I
encourage you to review the proxy statement for all the details regarding the
meeting agenda.
Your Board of Trustees believes these proposals are in the best interest
of the Fund and its shareholders and unanimously recommends a vote "for" all
proposals. Regardless of the number of shares you own, it is important that they
be represented and voted. Accordingly, please sign, date and mail the enclosed
proxy card in the postage paid return envelope. If you have any questions
regarding the meeting agenda or need assistance in voting, please contact our
proxy solicitor, D.F. King & Co., Inc. at 1-800-207-3156.
Your prompt response will help save the Fund the expense of additional
solicitation.
Sincerely,
/s/ Ronald P. Lynch
---------------------
Ronald P. Lynch
Chairman of the Board
April 17, 1996
<PAGE>
LORD ABBETT SECURITIES TRUST
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS TO BE HELD
JUNE 19, 1996
PROXY STATEMENT
Notice of Special Meeting of Shareholders
To Be Held June 19, 1996 April 17, 1996
Notice is given hereby of a special meeting of the shareholders of Lord Abbett
Securities Trust (the "Fund"). The meeting will be held at the offices of Lord,
Abbett & Co., on the 11th floor of The General Motors Building, 767 Fifth
Avenue, New York, New York, on Wednesday, June 19, 1996, at 11:00 a.m., for the
following purposes and to transact such other business as may properly come
before the meeting and any adjournments thereof.
ITEM 1. To ratify or reject the selection of Deloitte & Touche LLP as
independent public accountants of the Fund for the current fiscal year;
ITEM 2. To approve or disapprove certain changes in the fundamental
investment policies and restrictions of the Lord Abbett Growth & Income Trust
series of the Fund (the "Series"); and
ITEM 3. To approve or disapprove a new Distribution Plan and Agreement
for the existing class of shares of the Series pursuant to Rule 12b-1 under the
Investment Company Act of 1940.
By order of the Board of Trustees
Kenneth B. Cutler
Vice President and Secretary
The Board of Trustees has fixed the close of business on March 22, 1996 as the
record date for determination of shareholders of the Fund entitled to notice of
and to vote at the meeting. Shareholders are entitled to one vote for each share
held. As of March 22, 1996, there were 138,028,692 shares of the Fund and
7,971,706 shares of the Series issued and outstanding.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD.
SIGN, DATE AND RETURN IT IN THE ENVELOPE PROVIDED.
TO SAVE THE COST OF ADDITIONAL SOLICITATIONS, PLEASE MAIL YOUR PROXY PROMPTLY.
<PAGE>
LORD ABBETT SECURITIES TRUST
767 Fifth Avenue
New York, New York 10153
April 17, 1996
PROXY STATEMENT
---------------
This Proxy Statement is furnished to the shareholders of Lord Abbett
Growth & Income Trust (the "Series"), a series of Lord Abbett Securities Trust,
a diversified, open-end management investment company organized as a Delaware
business trust (the "Fund"), in connection with the solicitation of proxies by
and on behalf of the Board of Trustees for use at a special meeting of
shareholders of the Fund to be held at 11:00 a.m. on Wednesday, June 19, 1996 at
the offices of Lord, Abbett & Co., the investment manager and principal
underwriter of the Fund ("Lord Abbett"), on the 11th floor of the General Motors
Building, 767 Fifth Avenue, New York, New York 10153, and at any adjournments
thereof. This proxy statement and the enclosed proxy card are first being
mailed to shareholders on or about April 17, 1996.
At the close of business on March 22, 1996 (the "Record Date"), there
were issued and outstanding 138,028,692 shares of the Fund and 7,971,706 shares
of the Series. Only shareholders of record at the close of business on the
Record Date are entitled to notice of, and to vote at, the special meeting or
any adjournment thereof. Proxies will be solicited by mail. Additional
solicitations may be made by telephone, facsimile or personal contact by
officers or employees of Lord Abbett and its affiliates. The Fund may also
request brokerage houses, custodians, nominees, and fiduciaries who are
shareholders of record to forward proxy materials to beneficial owners. D.F.
King & Co. has been retained to assist in the solicitation of proxies at an
estimated cost of $5,000. The cost of the solicitation will be borne by the
Series.
Shareholders are entitled to one vote for each full share, and a pro
portionate vote for each fractional share, of the Series held as of the Record
Date. Under Delaware law, shares owned by two or more persons (whether as joint
tenants, co-fiduciaries or otherwise) will be voted as follows, unless a written
instrument or court order providing to the contrary has been filed with the
Secretary of the Fund: (1) if only one votes, that vote binds all; (2) if more
- -
than one votes, the vote of the majority binds all; and (3) if more than one
-
votes and the vote is evenly divided, the vote will be cast proportionately. If
the enclosed form of proxy is properly executed and returned in time to be voted
at the meeting, the proxies named therein will vote
<PAGE>
the shares represented by the proxy in accordance with the instructions marked
thereon. Unmarked proxies will be voted FOR each of the items described in this
Proxy Statement and any other matters as deemed appropriate. A proxy may be
revoked by the signer at any time at or before the meeting by written notice to
the Fund, by execution of a later-dated proxy or by voting in person at the
meeting.
1. RATIFICATION OR REJECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Trustees has selected Deloitte & Touche LLP as the in
dependent public accountants of the Fund for the fiscal year ending October 31,
1996. The Investment Company Act of 1940, as amended (the "Act"), requires that
such selection be submitted for ratification or rejection at the next annual
meeting of shareholders if such meeting be held. Deloitte & Touche LLP acted as
the Fund's independent public accountants for the year ended October 31, 1995,
and since the Fund's inception in 1993. Based on information in the possession
of the Fund, and information furnished by Deloitte & Touche LLP, the firm has no
direct financial interest and no material indirect financial interest in the
Fund. A representative of Deloitte & Touche LLP is expected to attend the
meeting and will be provided with an opportunity to make a statement and answer
appropriate questions.
Ratification of the selection of Deloitte & Touche LLP requires the
affirmative vote of a majority of the votes cast by shareholders of the Fund.
If a shareholder abstains from voting on this matter, then the shares held by
such shareholder shall be deemed present at the meeting for purposes of
determining a quorum, but shall not be deemed to have been voted on this matter.
If a broker returns a "non-vote" proxy, indicating a lack of authority to vote
on this matter, then the shares covered by such non-vote shall be deemed present
at the meeting for purposes of determining a quorum but shall not be deemed to
have been voted on this matter.
The Board of Trustees recommends that shareholders vote to ratify the
selection of Deloitte & Touche LLP as the Fund's independent public accountants
for the fiscal year ending October 31, 1996.
2
<PAGE>
2. PROPOSAL TO AMEND THE FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS OF
THE SERIES
The Board of Trustees has approved various amendments to the Series'
investment policies and restrictions in order to provide increased flexibility
in managing the Series' investment portfolio and to provide some uniformity in
the investment policies and restrictions among the various Lord Abbett-sponsored
funds. The Series' investment policies and restrictions designated "fundamental"
may be changed only by the vote of a "majority" (as defined in the Act) of the
Series' voting securities. Those investment policies and restrictions
designated "non-fundamental" may be changed by the vote of the Board of Trustees
alone. Therefore, the proposed amendments to the fundamental policies and
restrictions described below require shareholder approval. The Series' current
fundamental investment policies and restrictions and its proposed fundamental
and certain non-fundamental investment policies and restrictions are set forth
in Exhibit A attached hereto.
The Series' investment policies and restrictions govern generally the
investment activities of the Series and limit its ability to invest in certain
types of securities or engage in certain types of transactions. The proposed
changes are not expected to affect materially the current operations of the
Series. The proposed fundamental investment policies and restrictions have been
made less restrictive in order to provide greater flexibility in the future
management of the Series investment portfolio and to provide some uniformity
among the Lord Abbett-sponsored funds as noted above. The Board of Trustees has
no present intention of approving actions permitted by these less restrictive
fundamental policies and restrictions. If it were to do so, the risks of
investing in the Series could be increased. No change is proposed with respect
to the Series' investment objective, which is long-term growth of income and
capital without excessive fluctuations in market value.
The proposed policies and restrictions restate many of the policies and
restrictions currently in effect for the Series. In some instances, certain
fundamental policies and restrictions have been modified or eliminated in
accordance with developments in Federal or state blue sky regulations or in the
securities markets since the inception of the Series. In other instances, as
illustrated in Exhibit A, certain policies and restrictions previously deemed
fundamental have been redesignated non-fundamental. By making certain policies
and restrictions non-fundamental, the board may amend a policy or restriction as
it deems appropriate and in the best interest of the Series and its
shareholders, without incurring the costs (normally borne by the Series and its
shareholders) of seeking a shareholder vote. Also, certain of the proposed
fundamental investment policies and restrictions are stated in terms of "to the
extent permitted by applicable law". Applicable law can change over time and
may become more or less restrictive as a result. The policies
3
<PAGE>
and restrictions have been drafted in this manner so that a change in law would
not require the Series to seek a shareholder vote to amend the policy or
restriction to conform to applicable law, as revised.
The principal effect of the proposed amendments will be to permit the
Series to take certain actions not now permitted to the Series without obtaining
additional shareholder approval. The Series either will not be permitted to, or
does not intend to, take any such action unless such action is approved by the
Board of Trustees. The board does not now intend to approve any such action or
to do so in the future unless it deems such action to be an appropriate means of
seeking the Series' investment objective in the best interests of the Series and
its shareholders, in which case disclosure of the change would be made in the
Fund's then current prospectus or statement of additional information or both.
Such actions, none of which the board has a present intention of approving,
involve the following matters, among others: (i) borrowings from banks in
-
amounts up to one-third of total assets (and up to an additional 5% of total
assets for temporary purposes) and such short-term credits as may be necessary
for the clearance of purchases and sales of portfolio securities; (ii) loans of
--
portfolio securities to the extent permitted by law; and (iii) purchases and
---
sales of securities directly or indirectly secured by real estate or interests
therein, commodities and commodity contracts in accordance with applicable law
so long as registration would not be required as a commodity pool operator under
the Commodity Exchange Act. See Exhibit A hereto for a detailed comparison of
the Series' current fundamental investment policies and restrictions and its
proposed fundamental and certain non-fundamental investment policies and
restrictions.
Approval of the proposed amendments to the Series' fundamental investment
policies and restrictions requires the affirmative vote of a "majority" (as
defined in the Act) of the Series' voting securities. A "majority" vote for a
Series is defined in the Act as the vote of the holders of the lesser of: (i)
-
67% or more of the voting securities of such Series present or represented by
proxy at the shareholders meeting, if the holders of more than 50% of the
outstanding voting securities of such Series are present or represented by
proxy, or (ii) more than 50% of the outstanding voting securities of such
--
Series. The effect of an abstention or broker non-vote is the same as a vote
against this proposal.
If the proposed amendments are not approved by the shareholders of the
Series, the current fundamental policies and restrictions will continue in
effect.
The Board of Trustees recommends that shareholders vote in favor of the
proposed amendments to the Series' fundamental investment policies and
restrictions.
4
<PAGE>
3. NEW DISTRIBUTION PLAN AND AGREEMENT FOR THE CLASS C SHARES
At a meeting of the Board of Trustees of the Fund held on March 14, 1996,
the trustees of the Fund unanimously approved, subject to shareholder ap proval,
and determined to submit to the shareholders of the Series for approval, a new
Distribution Plan and Agreement pursuant to Rule 12b-1 under the Act (the
"Proposed Plan") for the existing class of shares of the Series. The existing
class of shares is to be designated the Class C Shares. The text of the
Proposed Plan is attached hereto as Exhibit B. The trustees who approved the
Proposed Plan include all of the In dependent Trustees, none of whom is an
"interested person" of the Fund within the meaning of the Act or has a direct or
indirect financial interest in the operations of the Proposed Plan or in any
agreements related thereto.
If approved by shareholders, the Proposed Plan will replace the dis
tribution plan and agreement (the "Current Plan") that was approved by
shareholders and became effective on October 20, 1993. The changes included in
the Proposed Plan, which are described below, are designed primarily to maintain
the competitive position of the Class C Shares of the Series.
Under the Current Plan (except as to certain accounts for which tracking
data is not available), the Series pays dealers through Lord Abbett distribution
and service fees (a) at the time shares are sold, not to exceed 0.75% and 0.25%,
-
respectively, of the net asset value of such shares and (b) at the end of the
-
quarter following the first anniversary of the sale of shares, and quarterly
thereafter, at an annual rate not to exceed 0.75% and 0.25%, respectively, of
the net asset value of such shares, including any shares issued for reinvested
dividends and distributions after such first anniversary, so long as such shares
remain outstanding. Lord Abbett may retain from the quarterly distribution fee,
for the payment of distribution expenses incurred directly by it, an amount not
to exceed 0.10% of the average annual net asset value of such shares
outstanding. These service and distribution fees are intended to provide
additional incentives for dealers (a) to provide continuing information and
-
investment services to their shareholder accounts and otherwise to encourage
their accounts to remain invested in the Series and (b) to sell shares of the
-
Series.
If shares of the Series are redeemed for cash before the first
anniversary of their purchase, the redeeming shareholder is required to pay to
the Series a contingent deferred reimbursement charge ("CDRC") of 1% of the
original cost or the then net asset value, whichever is less, of such shares.
If the shares are exchanged for shares of another series of the Fund or for
shares of Lord Abbett U.S. Government Securities Money Market Fund ("GSMMF") and
subsequently redeemed
5
<PAGE>
before the first anniversary of their original purchase, the charge will be
collected for the Series by the other series or GSMMF.
Set forth below is a description of the principal changes to be effected
under the Proposed Plan:
(a) Payments to Authorized Institutions. The fees payable under the
-----------------------------------
Proposed Plan will remain unchanged, except that payments thereunder may be made
to institutions and persons permitted by applicable law and/or rules to receive
such payments ("Authorized Institutions"), rather than just to dealers as is the
case under the Current Plan.
(b) Lord Abbett Distributor. The other party to the Proposed Plan is to
-----------------------
be Lord Abbett Distributor LLC, a New York limited liability company to be
formed as a subsidiary of Lord Abbett ("Lord Abbett Distributor"), rather than
Lord Abbett. Lord Abbett Distributor is to take on all the underwriting
functions currently performed directly by Lord Abbett.
(c) CDRC. Commencing July 15, 1996, the Class C Shares of the Series are
----
to become exchangeable for Class C Shares of other Lord Abbett-sponsored funds
rather than for shares of other series of the Fund. A CDRC will not be payable
upon such an exchange unless the shares received in the exchange are
subsequently redeemed before the first anniversary of their original purchase.
In considering whether to recommend the Proposed Plan for approval, the
board considered, among other things, that since the Current Plan was adopted,
different methods of distribution, using different entities, have developed in
the industry. The board sees no reason to limit arbitrarily the categories of
persons eligible to receive payments under the Proposed Plan, and believes that
the availability of payments under the plan will induce such other entities to
invest in Class C Shares.
In light of the anticipated benefits to the Series and its shareholders
as a result of adopting the Proposed Plan, and having reviewed a comparison of
the costs to the Series of the Current Plan and the Proposed Plan, the trustees
of the Fund have concluded, in the exercise of reasonable business judgment and
in light of their fiduciary duties, that there is a reasonable likelihood that
the Proposed Plan will benefit the Series and its shareholders. There can,
however, be no assurance that the anticipated benefits will be realized.
Set forth in the tables below is a summary comparison of the expenses of
the Series, on a current and pro-forma basis. The annual operating expenses
6
<PAGE>
shown in the second column of each table are the Series' actual expenses for the
fiscal year ended October 31, 1995. The expenses shown in the third column
represent, on a pro-forma basis, such actual expenses of the Series adjusted to
show the effect of the changes effected by the Proposed Plan. The example set
forth below is not a representation of past or future expenses. Actual expenses
may be greater or less than those shown.
<TABLE>
<CAPTION>
I II III
- ------------------------------------------------------------------------------------
Year ended October 31, Pro-Forma
1995 (reflecting the (reflecting the
Current Plan) Proposed Plan)
- ------------------------------------------------------------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
(AS A PERCENTAGE OF OFFERING PRICE)
- ------------------------------------------------------------------------------------
Maximum Sales Load/1/ on Purchases None None
Deferred Sales Load /1 / 1.00%/2/ 1.00%/2/
- ------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
- ------------------------------------------------------------------------------------
Management Fee 0.00%/3/ 0.00%/3/
12b-1 Fees 0.88% 0.88%
Other Expenses 0.28%/3/ 0.28%/3/
- ------------------------------------------------------------------------------------
Total Operating Expenses 1.16%/3/ 1.16%/3/
- ------------------------------------------------------------------------------------
</TABLE>
Example: Assume an annual return of 5% and there is no change in the level of
- -------
expenses described above. For every $1,000 invested, with reinvestment of all
distributions, you would pay the following total expenses if you closed your
account after the number of years indicated.
<TABLE>
<CAPTION>
1 YEAR/3,4/ 3 YEARS/3,4/ 5 YEARS/3,4/ 10 YEARS/3,4/
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CURRENT $12 $37 $64 $141
- -------------------------------------------------------------------------------
PRO-FORMA (ESTIMATED) $12 $37 $64 $141
- -------------------------------------------------------------------------------
</TABLE>
1. Sales "load" is referred to as sales "charge" and "deferred sales load"
is referred to as "contingent deferred reimbursement charge" or "CDRC"
throughout this Proxy Statement. Although the Series does not charge a front-end
sales charge, investors should be aware that long-term shareholders may pay,
under both the Current Plan and the Proposed Plan, more
7
<PAGE>
than the economic equivalent of the maximum front-end sales charges permitted by
certain rules of the National Association of Securities Dealers, Inc.
2. Under both the Current Plan and the Proposed Plan, redemptions of shares are
subject to a CDRC of 1% of the original cost or the then net asset value,
whichever is less, if the redemption occurs before the first anniversary of the
original purchase, subject to certain exceptions described herein.
3. Although not obligated to, Lord Abbett may waive its management fee and
subsidize the operating expenses with respect to the Series. For the fiscal
year ended October 31, 1995, Lord Abbett waived its management fee for the
Series. Without such waiver, the management fee would have been 0.75%, and the
total operating expenses would have been 1.91%.
4. Based on total current and pro-forma operating expenses shown in the table
above.
If the shareholders approve the Proposed Plan, the Proposed Plan shall,
unless terminated as described below, become effective July 12, 1996 and
continue in effect until July 12, 1997 and from year to year thereafter only so
long as such continuance is specifically approved, at least annually, by the
Fund's Board of Trustees and its Independent Trustees by a vote cast in person
at a meeting called for the purpose of voting on such continuance. The Proposed
Plan may be terminated at any time by a vote of a majority of the Independent
Trustees or by a shareholder vote in compliance with Rule 12b-1 under the Act.
The Plan may not be amended to increase materially the amount to be spent for
distribution above the maximum amounts set forth in the Proposed Plan without a
shareholder vote in compliance with Rule 12b-1 under the Act. All material
amendments must be approved by a majority of the Independent Trustees.
The Proposed Plan provides that while it is in effect, the selection and
nomination of Independent Trustees is committed to the discretion of the
Independent Trustees then sitting on the board. This does not prevent the
involvement of others in such selection and nomination if the final decision on
any such selection or nomination is approved by a majority of the Independent
Trustees.
Pursuant to Rule 12b-1 under the Act, approval of the Proposed Plan
requires the affirmative vote of a "majority" (as defined in the Act) of the
voting securities of the Series. A "majority" vote for a Series is defined in
the Act as the vote of the holders of the lesser of: (i) 67% or more of the
-
voting securities of such Series present or represented by proxy at the
shareholders meeting, if the holders of more than 50% of the outstanding voting
securities of such Series are present or represented by proxy, or (ii) more than
--
50% of the outstanding voting securities of such Series. The effect of an
abstention or broker non-vote is the same as a vote against this proposal.
8
<PAGE>
If the Proposed Plan is not approved, the Current Plan for the Series
will continue in effect according to its terms.
The Board of Trustees recommends that shareholders of the Series vote in
favor of adoption of the Proposed Plan.
4. OTHER INFORMATION
Management is not aware of any matters to come before the meeting other
than those set forth in the notice. If any such other matters do come before
the meeting, the individuals named as proxies will vote, act, and consent with
respect thereto in accordance with their best judgment.
a. Transactions Involving the Series
and other Series of the Fund.
---------------------------------
It is expected that the Series will acquire the assets of Lord Abbett
Fundamental Value Fund, Inc. ("LAFVF"). This transaction, which is subject to
certain conditions, has been approved by the Board of Trustees of the Fund,
including a majority of the Independent Trustees, as being in the best interests
of the shareholders of the Series. Shareholders of the Series are not required
to approve this transaction. As of March 22, 1996, the net assets of LAFVF were
approximately $45,377,049 and the net assets of the Series were approximately
$53,827,274.
If such transaction is consummated, Class A Shares of the Series will be
issued to the shareholders of LAFVF. The Class A Shares and the existing shares
of the Series, which are to be designated the Class C Shares, will be classes
within the Series. Each such share, regardless of class, will share pro rata
(based on net asset value) in the portfolio and income of the Series and in the
Series' expenses, except for differences in expenses resulting from different
Rule 12b-1 Plans for the classes and possibly other class-specific expenses.
The Class A Shares of the Series are to be subject to a Rule 12b-1 plan that
involves annual distribution and service fees for the account of such class that
are expected initially to equal approximately 0.23% of the average net asset
value of the Class A Shares.
If LAFVF is acquired as proposed, Lord Abbett has agreed to amend the
investment management agreement between the Fund, on behalf of the Series, and
Lord Abbett to include the same breakpoints as are contained in the investment
management agreement between LAFVF and Lord Abbett. Under the management
agreement currently applicable to the Series, the Series is obligated to pay a
monthly fee, based on average daily net assets for each month, at the annual
rate of 0.75%. If
9
<PAGE>
the acquisition of LAFVF is consummated, the management agreement of the Series
will be amended to provide for payment of a monthly fee at the annual rate of
0.75% of the first $200 million of average daily net assets, 0.65% of the next
$300 million of such assets and 0.50% of such assets in excess of $500 million.
The Board of Trustees of the Fund has also approved a sale of the assets
of each of the other series of the Fund to another Lord Abbett-sponsored fund
having an identical or similar investment objective. Following the sale of
their assets in these transactions, which are subject to certain conditions, the
other series of the Fund will terminate. Commencing July 15, 1996, following
the closings of these various transactions, the Class C Shares of the Series are
to become exchangeable for Class C Shares of the other Lord Abbett-sponsored
funds rather than for shares of the other series of the Fund.
Also commencing July 15, 1996, both classes of the Series are to be
offered to the public. It is expected that implementation of the Series' multi-
class structure will (i) enable investors in the Series to choose the
-
distribution option that best suits their individual situations, (ii) facilitate
--
distribution of the Series' shares, and (iii) maintain the competitive position
---
of the Series in relation to other funds that have implemented or are seeking to
implement similar distribution arrangements.
b. Share Ownership of Management
-----------------------------
Listed below is the number of shares of the Fund owned beneficially by
each trustee as of March 22, 1996, together with the number of "phantom" shares
credited to the account of each trustee under a plan (the "Deferred Plan")
permitting independent trustees to defer their trustees' fees and to have the
deferred amounts deemed invested in shares of the Fund for later payment. Also
shown is the number of shares owned beneficially by the trustees and officers as
a group, together with such "phantom" shares credited to the accounts of
trustees as a group. In each case, the amounts shown are less than 1% of the
Fund's outstanding shares of beneficial interest.
10
<PAGE>
<TABLE>
<CAPTION>
Number of Shares
Beneficially
Name Owned and Phantom Shares/1/
- ---------------------------------- -----------------------------
<S> <C>
Ronald P. Lynch 148
Robert S. Dow 1,484
E. Thayer Bigelow 3
Stewart S. Dixon 148
John C. Jansing 3
C. Alan MacDonald 0
Hansel B. Millican, Jr. 3
Thomas J. Neff 3
Trustees and Officers as a group 2,984
</TABLE>
- -------------------
1. Of the shares listed in the foregoing table, the following constitute
"phantom" shares credited to trustees under the Deferred Plan: Mr. Bigelow, 3
shares; Mr. Dixon, 0 shares; Mr. Jansing, 3 shares; Mr. MacDonald, 0 shares; Mr.
Millican, 3 shares; Mr. Neff, 3 shares; and trustees as a group: 12 shares.
c. Timeliness of Shareholder Proposals.
-----------------------------------
Any shareholder proposals to be presented for action at the Fund's next
shareholder meeting pursuant to the provisions of Rule 14a-8 under the
Securities Exchange Act of 1934, as amended, must be received at the Fund's
principal execu tive offices within a reasonable time in advance of the date
solicitation is made for such meeting. The Fund does not intend to hold another
annual or special meeting of shareholders unless required to do so by the Act.
d. Investment Adviser and Underwriter.
----------------------------------
Lord, Abbett & Co., 767 Fifth Avenue, New York, New York 10153, acts as
investment adviser and principal underwriter with respect to the Fund.
e. Annual Report Available Upon Request.
------------------------------------
The Fund will furnish, without charge, a copy of the Fund's most recent
annual report and the most recent semi-annual report succeeding the annual
report, if any, to a shareholder upon request. A shareholder may obtain such
report(s) by writing to the Fund or by calling 800-874-3733.
11
<PAGE>
f. Portfolio Transactions.
----------------------
The Fund's policy with respect to the Series is to obtain best execution
on all portfolio transactions, which means that the Fund seeks to have purchases
and sales of portfolio securities executed at the most favorable prices,
considering all costs of the transaction including brokerage commissions and
dealer markups and markdowns and taking into account the full range and quality
of the brokers' services. Consistent with obtaining best execution, the Series
may pay, as described below, a higher commission than some brokers might charge
on the same transactions. The Fund's policy with respect to best execution
governs the selection of brokers or dealers and the market in which the
transaction is executed. To the extent permitted by law, the Fund may, if
considered advantageous, make a purchase from or sale to another Lord Abbett
sponsored fund without the intervention of any broker-dealer.
Broker-dealers are selected on the basis of their professional capacity
and the value and quality of their brokerage and research services. Normally,
the selection is made by traders who are officers of the Fund and also are
employees of Lord Abbett. These traders do the trading as well for other
accounts -- investment companies (of which they are also officers) and other
investment clients -- managed by Lord Abbett. They are responsible for
obtaining best execution.
The Series pays a commission rate that Fund management believes is
appropriate to give maximum assurance that the Series' brokers will provide to
the Series, on a continuing basis, the highest level of brokerage services
available. While the Fund does not always seek the lowest possible commissions
on particular trades, the Fund believes that its commission rates are in line
with the rates that many other institutions pay. The Fund's traders are
authorized to pay brokerage commissions in excess of those that other brokers
might accept on the same transactions in recognition of the value of the
services performed by the executing brokers, viewed in terms of either the
particular transaction or the overall responsibilities of Lord Abbett with
respect to the Series and the other accounts they manage. Such services include
showing the Series trading opportunities including blocks, a willingness and
ability to take positions in securities, knowledge of a particular security or
market, proven ability to handle a particular type of trade, confidential
treatment, promptness and reliability.
Some of the Fund's brokers also provide research services at least some
of which are useful to Lord Abbett in their overall responsibilities with
respect to the Series and the other accounts they manage. Research includes the
furnishing of analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and the performance of accounts
and trading equipment and computer software packages, acquired from third-party
suppliers, that enable Lord
12
<PAGE>
Abbett to access various information bases. Such services may be used by Lord
Abbett in servicing all their accounts, and not all of such services will
necessarily be used by Lord Abbett in connection with their management of the
Series; conversely, such services furnished in connection with brokerage on
other accounts managed by Lord Abbett may be used in connection with their
management of the Series, and not all of such services will necessarily be used
by Lord Abbett in connection with their advisory services to such other
accounts. The Fund has been advised by Lord Abbett that research services
received from brokers cannot be allocated to any particular account, are not a
substitute for Lord Abbett's services but are supplemental to their own research
effort and, when utilized, are subject to internal analysis before being
incorporated by Lord Abbett into their investment process. As a practical
matter, it would not be possible for Lord Abbett to generate all of the
information presently provided by brokers. While receipt of research services
from brokerage firms has not reduced Lord Abbett's normal research activities,
the expenses of Lord Abbett could be materially increased if it attempted to
generate such additional information through its own staff and purchased such
equipment and software packages directly from the suppliers.
No commitments are made regarding the allocation of brokerage business to
or among brokers and trades are executed only when they are dictated by
investment decisions of the Fund to purchase or sell portfolio securities.
If two or more broker-dealers are considered capable of offering the
equivalent likelihood of best execution, the broker-dealer who has sold the
Fund's shares and/or shares of other Lord Abbett-sponsored funds may be
preferred.
If other clients of Lord Abbett buy or sell the same security at the same
time as the Fund, transactions will, to the extent practicable, be allocated
among all participating accounts in proportion to the amount of each order and
will be executed daily until filled so that each account shares the average
price and commission cost of each day. Other clients who direct that their
brokerage business be placed with specific brokers or who invest through wrap
accounts introduced to Lord Abbett by certain brokers may not participate with
the Fund in the buying and selling of the same securities as described above.
If these clients wish to buy or sell the same security as the Fund does, they
may have their transactions executed at times different from the Fund's
transactions and thus may not receive the same price or incur the same
commission cost as the Fund does.
The Fund will not seek "reciprocal" dealer business (for the purpose of
applying commissions in whole or in part for the Fund's benefit or otherwise)
from broker-dealers as consideration for the direction to them of portfolio
business.
13
<PAGE>
For the fiscal years ended October 31, 1995, and the period from January
4, 1994 (commencement of operations), the Series paid $41,192 and $11,162 in
commissions to independent broker-dealers.
LORD ABBETT SECURITIES TRUST
Kenneth B. Cutler
Vice President and Secretary
14
<PAGE>
EXHIBIT A
COMPARISON OF CURRENT FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS AND
PROPOSED
FUNDAMENTAL AND CERTAIN NON-FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
SHORT SALES/MARGIN.
No policy/restriction stated. FUNDAMENTAL
The Series may purchase securities on
margin to the extent permitted by applica-
ble law.
NON-FUNDAMENTAL
The Series may not make short sales of
securities or maintain a short position
except to the extent permitted by applic-
able law.
- ------------------------------------------------------------------------------------------------------
BORROWING.
FUNDAMENTAL FUNDAMENTAL
The Series may not borrow money except (i) The Series may not borrow money,
as a temporary measure for extraordinary or except that (i) the Series may borrow
emergency purposes, and then not in excess of from banks (as defined in the Act) in
5% of the Series' gross assets (at cost or amounts up to 33 1-3% of its total assets
market value, which ever is lower) at the time (including the amount borrowed), (ii) the
of borrowing and (ii) unless such borrowing Series may borrow up to an additional
does not exceed the asset coverage 5% of its total assets for temporary
requirements of Section 18(f) of the Act. purposes, and (iii) the Series may obtain
such short-term credit as may be
necessary for the clearance of purchases
and sales of portfolio securities.
NON-FUNDAMENTAL
The Series may not borrow in excess of
5% of its gross assets taken at cost or
market value, whichever is lower at the
time of borrowing, and then only as a
temporary measure for extraordinary or
emergency purposes.
- ------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
UNDERWRITING.
FUNDAMENTAL FUNDAMENTAL
The Series may not engage in the underwriting The Series may not engage in the under-
of securities except pursuant to a merger or writing of securities, except pursuant to a
acquisition or to the extent that in connection merger or acquisition or to the extent
with the disposition of its portfolio securities it that, in connection with the disposition of
may be deemed to be an underwriter under its portfolio securities, it may be deemed
federal securities laws. Notwithstanding the to be an underwriter under federal securi-
foregoing, in the future, upon shareholder ties laws.
approval, the Series may seek to achieve its
investment objective by investing all of its
assets in another investment company (or
series or class thereof) having the same
investment objective. Shareholders will be
notified thirty days in advance of such
conversion.
- ------------------------------------------------------------------------------------------------------
LENDING.
FUNDAMENTAL FUNDAMENTAL
The Series may not lend money or securities to The Series may not make loans to other
any person except through entering into short- persons, except that the acquisition of
term repurchase agreements with sellers of bonds, debentures or other corporate debt
securities the Series has purchased and by securities and investment in government
lending Series portfolio securities to registered obligations, commercial paper, pass-
broker-dealers where the loan is 100% secured through instruments, certificates of depos-
by cash or its equivalent as long as the Series it, bankers acceptances, repurchase agree-
complies with regulatory requirements and ments or any similar instruments shall not
except for time or demand deposits with banks be subject to this limitation, and except
and purchases of commercial paper or further that the Series may lend its
publicly-offered debt securities at original issue portfolio securities, provided that the
or otherwise. If the Series enters into lending of portfolio securities may be
repurchase agreements as provided above, it made only in accordance with applicable
will do so only with those primary reporting law.
dealers that report to the Federal Reserve Bank
of New York and with the 100 largest United
States commercial banks and the underlying
securities purchased under the agreements will
consist only of those securities in which the
Series otherwise may invest.
- ------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
REAL ESTATE/COMMODITIES.
FUNDAMENTAL FUNDAMENTAL
The Series may not buy or sell real estate The Series may not buy or sell real estate
(including limited partnerships therein but (except that the Series may invest in secu-
excluding securities of companies, such as real rities directly or indirectly secured by
estate investment trusts, which deal in real real estate or interests therein or issued
estate or interests therein), oil, gas or other by companies which invest in real estate
mineral leases or in commodities or or interests therein) or commodities or
commodity contracts in the ordinary course of commodity contracts (except to the extent
its business, except such interests and other the Series may do so in accordance with
property acquired as a result of owning other applicable law and without registering as
securities, though securities will not be a commodity pool operator under the
purchased in order to acquire any of these Commodity Exchange Act as, for
interests. example, with futures contracts).
NON-FUNDAMENTAL
The Series may not invest in real estate
limited partnership interests or interests
in oil, gas or other mineral leases, or
exploration or other development
programs, except that the Series may
invest in securities issued by companies
that engage in oil, gas or other mineral
exploration or development activities.
- ------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
DIVERSIFICATION.
FUNDAMENTAL FUNDAMENTAL
The Series may not, with respect to 75% of With respect to 75% of its gross assets,
the gross assets of the Series, buy securities if the Series may not buy securities of one
the purchase would then cause it to (i) have issuer representing more than (i) 5% of
more than 5% of its gross assets, at market the Series' gross assets, except securities
value at the time of investment, invested in the issued or guaranteed by the U.S. Govern-
securities of any one issuer except securities ment, its agencies or instrumentalities, or
issued or guaranteed by the U.S. Government, (ii) 10% of the voting securities of such
its agencies or instrumentalities or (ii) own issuer.
more than 10% of the voting securities of any
issuer. Notwithstanding the foregoing, in the
future, upon shareholder approval, the Series
may seek to achieve its investment objective
by investing all of its assets in another
investment company (or series or class thereof)
having the same investment objective.
Shareholders will be notified thirty days in
advance of such conversion.
- ------------------------------------------------------------------------------------------------------
INVESTMENT IN A SINGLE INDUSTRY.
FUNDAMENTAL FUNDAMENTAL
The Series may not concentrate its investments The Series may not invest more than
in any particular industry, excluding U.S. 25% of its assets, taken at market value,
Government securities. Notwithstanding the in the securities of issuers in any
foregoing, in the future, upon shareholder particular industry (excluding securities
approval, the Series may seek to achieve its of the U.S. Government, its agencies and
investment objective by investing all of its instrumentalities).
assets in another investment company (or
series or class thereof) having the same
investment objective.
- ------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
RESTRICTED/ILLIQUID SECURITIES.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not invest knowingly
more than 15% of its net assets (at the
time of investment) in illiquid securities,
except for securities qualifying for resale
under Rule 144A of the Securities Act of
1933, deemed to be liquid by the Board
of Trustees.
- ------------------------------------------------------------------------------------------------------
MORTGAGING AND PLEDGING OF
ASSETS.
No policy/restriction stated. FUNDAMENTAL
The Series may not pledge its assets
(other than to secure borrowings, or to
the extent permitted by the Series'
investment policies, as permitted by
applicable law).
- ------------------------------------------------------------------------------------------------------
INVESTMENTS IN SECURITIES OF
OTHER INVESTMENT COMPANIES.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not invest in the
securities of other investment companies,
except as permitted by applicable law.
- ------------------------------------------------------------------------------------------------------
OPTIONS.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not write, purchase or
sell puts, calls, straddles, spreads or
combinations thereof, except to the extent
permitted in the Fund's prospectus and
statement of additional information, as
they may be amended from time to time.
- ------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
INVESTMENTS IN SECURITIES OF
ISSUERS IN OPERATION FOR LESS
THAN THREE YEARS.
No policy/restriction stated.
NON-FUNDAMENTAL
The Series may not invest in securities of
issuers which, with their predecessors,
have a record of less than three years
continuous operations, if more than 5%
of the Series' total assets would be
invested in such securities (this restriction
shall not apply to mortgage-backed
securities, asset-backed securities or
obligations issued or guaranteed by the
U.S. Government, its agencies or
instrumentalities).
- ------------------------------------------------------------------------------------------------------
OWNERSHIP OF PORTFOLIO
SECURITIES BY OFFICERS AND
DIRECTORS.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not hold securities of any
issuer if more than 1/2 of 1% of the
securities of such issuer are owned
beneficially by one or more officers or
trustees of the Fund or by one or more
partners or members of the underwriter
or investment advisor if these owners in
the aggregate own beneficially more than
5% of the securities of such issuer.
- ------------------------------------------------------------------------------------------------------
TRANSACTIONS WITH CERTAIN
PERSONS.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not buy from or sell to
any of its officers, trustees, employees,
or its investment adviser or any of its
officers, directors, partners or employees,
any securities other than shares of
beneficial interest in the Series.
- ------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
CURRENT POLICY/RESTRICTION PROPOSED POLICY/RESTRICTION
-------------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------
<S> <C>
SENIOR SECURITIES.
FUNDAMENTAL FUNDAMENTAL
The Series may not issue senior securities. The Series may not issue senior securities
to the extent such issuance would violate
applicable law.
- ------------------------------------------------------------------------------------------------------
PURCHASE OF WARRANTS.
No policy/restriction stated. NON-FUNDAMENTAL
The Series may not invest in warrants if,
at the time of the acquisition, its
investment in warrants, valued at the
lower of cost or market, would exceed
5% of the Series' total assets (included
within such limitation, but not to exceed
2% of the Series' total assets, are
warrants which are not listed on the New
York or American Stock Exchange or a
major foreign exchange).
- ------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
EXHIBIT B
Rule 12b-1 Distribution Plan and Agreement
Lord Abbett Securities Trust -- Lord Abbett Growth & Income Trust
-- Class C Shares
RULE 12b-1 DISTRIBUTION PLAN AND AGREEMENT dated as of July 12, 1996 by
and between LORD ABBETT SECURITIES TRUST, a Delaware business trust (the
"Fund"), on behalf of its LORD ABBETT GROWTH & INCOME TRUST series (the
"Series"), and LORD ABBETT DISTRIBUTOR LLC, a New York limited liability company
(the "Distributor").
WHEREAS, the Fund is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "Act"); and the
Distributor is the exclusive selling agent of the Fund's shares of beneficial
interest, including the Series' Class C shares (the "Shares") pursuant to the
Distribution Agreement between the Fund and the Distributor, dated as of the
date hereof, and
WHEREAS, the Fund desires to adopt a Distribution Plan and Agreement (the
"Plan") for the Series with the Distributor, as permitted by Rule 12b-1 under
the Act, pursuant to which the Series may make certain payments to the
Distributor for payment to institutions and persons permitted by applicable law
and/or rules to receive such payments ("Authorized Institutions") in connection
with sales of Shares and for use by the Distributor as provided in paragraph 3
of this Plan, and
WHEREAS, the Fund's Board of Trustees has determined that there is a
reasonable likelihood that the Plan will benefit the Series and the holders of
the Shares.
NOW, THEREFORE, in consideration of the mutual covenants and of other
good and valuable consideration, receipt of which is hereby acknowledged, it is
agreed as follows:
1. The Fund hereby authorizes the Distributor to enter into agreements
with Authorized Institutions (the "Agreements") which may provide for the
payment to such Authorized Institutions of distribution and service fees which
the Distributor receives from the Series in order to provide incentives to such
Authorized Institutions (i) to sell Shares and (ii) to provide continuing
- --
information and investment services to their accounts holding Shares and
otherwise to encourage their accounts to remain invested in the Shares. The
Distributor may, from time to time, waive or
<PAGE>
defer payment of some fees payable at the time of the sale of Shares provided
for under paragraph 2 hereof.
2. Subject to possible reduction as provided below in this paragraph 2,
the Series shall pay to the Distributor fees (i) at the time of sale of Shares
-
(a) for services, not to exceed .25 of 1% of the net asset value of the Shares
- --
sold and (b) for distribution, not to exceed .75 of 1% of the net asset value of
-
the Shares sold; and (ii) at each quarter-end after the first anniversary of the
--
sale of Shares (a) for services, at an annual rate not to exceed .25 of 1% of
-
the average annual net asset value of Shares outstanding for one year or more
and (b) for distribution, at an annual rate not to exceed .75 of 1% of the
-
average annual net asset value of Shares out standing for one year or more. For
purposes of clause (ii) above, (A) Shares issued pursuant to an exchange for
-
Class C shares of another series of the Fund or another Lord Abbett-sponsored
fund (or for shares of a fund acquired by the Fund) will be credited with the
time held from the initial purchase of such other shares when determining how
long Shares mentioned in clause (ii) have been outstanding and (B) payments will
-
be based on Shares outstanding during any such quarter. Sales in clause (i)
above exclude Shares issued for reinvested dividends and distributions, and
Shares outstanding in clause (ii) above include Shares issued for reinvested
dividends and distributions which have been outstanding for one year or more.
The Board of Trustees of the Fund shall from time to time determine the amounts,
within the foregoing maximum amounts, that the Series may pay the Distributor
hereunder. Such determinations by the Board of Trustees shall be made by votes
of the kind referred to in paragraph 10 of this Plan. The service fees
mentioned in this paragraph are for the purposes mentioned in clause (ii) of
paragraph 1 of this Plan and the distribution fees mentioned in this paragraph
are for the purposes mentioned in clause (i) of paragraph 1 and the second
sentence of paragraph 3 of this Plan. The Distributor will monitor the payments
hereunder and shall reduce such payments or take such other steps as may be
necessary to assure that (x) the payments pursuant to this Plan shall be
-
consistent with Article III, Section 26, subparagraphs (d)(2) and (5) of the
Rules of Fair Practice of the National Association of Securities Dealers, Inc.
with respect to investment companies with asset-based sales charges and service
fees as the same may be in effect from time to time and (y) the Series shall not
-
pay with respect to any Authorized Institution service fees equal to more than
.25 of 1% of the average annual net asset value of Shares sold by (or
attributable to shares sold by) such Authorized Institution and held in an
account covered by an Agreement.
3. The Distributor may use amounts received as distribution fees
hereunder from the Series to finance any activity which is primarily intended to
result in the sale of Shares including, but not limited to, commissions or other
payments relating to selling or servicing efforts. Without limiting the
generality of the fore-
2
<PAGE>
going, the Distributor may apply up to 10 of the total basis points authorized
by the Fund's Board of Trustees designated as the distribution fee referred to
in clause (ii)(b) of paragraph 2 to expenses incurred by the Distributor if such
expenses are primarily intended to result in the sale of Shares. The Fund's
Board of Trustees (in the manner contemplated in paragraph 10 of this Plan)
shall approve the timing, categories and calculation of any payments under this
paragraph 3 other than those referred to in the foregoing sentence.
4. The net asset value of the Shares shall be determined as provided in
the Declaration and Agreement of Trust of the Fund. If the Distributor waives
all or a portion of fees which are to be paid by the Series hereunder, the
Distributor shall not be deemed to have waived its rights under this Agreement
to have the Series pay such fees in the future.
5. The Secretary of the Fund, or in his absence the Chief Financial
Officer, is hereby authorized to direct the disposition of monies paid or
payable by the Series hereunder and shall provide to the Fund's Board of
Trustees, and the Board of Trustees shall review, at least quarterly, a written
report of the amounts so expended pursuant to this Plan and the purposes for
which such expenditures were made.
6. Neither this Plan nor any other transaction between the parties
hereto pursuant to this Plan shall be invalidated or in any way affected by the
fact that any or all of the trustees, officers, shareholders, or other
representatives of the Fund are or may be "interested persons" of the
Distributor, or any successor or assignee thereof, or that any or all of the
directors, officers, partners, members or other representatives of the
Distributor are or may be "interested persons" of the Fund, except as otherwise
may be provided in the Act.
7. The Distributor shall give the Fund the benefit of the Distributor's
best judgment and good faith efforts in rendering services under this Plan.
Other than to abide by the provisions hereof and render the services called for
hereunder in good faith, the Distributor assumes no responsibility under this
Plan and, having so acted, the Distributor shall not be held liable or held
accountable for any mistake of law or fact, or for any loss or damage arising or
resulting therefrom suffered by the Fund, the Series or any of the shareholders,
creditors, directors or officers of the Fund; provided however, that nothing
herein shall be deemed to protect the Distributor against any liability to the
Fund or the Series' shareholders by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties hereunder, or by reason of the
reckless disregard of its obligations and duties hereunder.
3
<PAGE>
8. This Plan shall become effective on the date hereof, and shall
continue in effect for a period of more than one year from such date only so
long as such continuance is specifically approved at least annually by a vote of
the Board of Trustees of the Fund, including the vote of a majority of the
trustees who are not "interested persons" of the Fund and who have no direct or
indirect financial interest in the operation of this Plan or in any agreement
related to this Plan, cast in person at a meeting called for the purpose of
voting on such renewal.
9. This Plan may not be amended to increase materially the amount to be
spent by the Series hereunder without the vote of a majority of its outstanding
voting securities and each material amendment must be approved by a vote of the
Board of Trustees of the Fund, including the vote of a majority of the trustees
who are not "interested persons" of the Fund and who have no direct or indirect
financial interest in the operation of this Plan or in any agreement related to
this Plan, cast in person at a meeting called for the purpose of voting on such
amendment.
10. Amendments to this Plan other than material amendments of the kind
referred to in the foregoing paragraph 9 of this Plan may be adopted by a vote
of the Board of Trustees of the Fund, including the vote of a majority of the
trustees who are not "interested persons" of the Fund and who have no direct or
indirect financial interest in the operation of this Plan or in any agreement
related to this Plan. The Board of Trustees of the Fund may, by such a vote,
interpret this Plan and make all determinations necessary or advisable for its
administration.
11. This Plan may be terminated at any time without the payment of any
penalty by (a) the vote of a majority of the trustees of the Fund who are not
-
"interested persons" of the Fund and have no trustees or indirect financial
interest in the operation of this Plan or in any agreement related to this Plan,
or (b) by a shareholder vote in compliance with Rule 12b-1 and Rule 18f-3 under
-
the Act as in effect at such time. This Plan shall automatically terminate in
the event of its assignment.
12. So long as this Plan shall remain in effect, the selection and
nomination of those trustees of the Fund who are not "interested persons" of the
Fund are committed to the discretion of such disinterested trustees. The terms
"interested persons," "assignment" and "vote of a majority of the outstanding
voting securities" shall have the same meaning as those terms are defined in the
Act.
4
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this in strument to be
executed in its name and on its behalf by its duly authorized repre sentative as
of the date first above written.
LORD ABBETT SECURITIES TRUST
By: _________________________
President
ATTEST:
_________________________
Assistant Secretary
LORD ABBETT DISTRIBUTOR LLC
By: _________________________
5
<PAGE>
LORD ABBETT SECURITIES TRUST
LORD ABBETT GROWTH & INCOME TRUST
SPECIAL MEETING OF SHAREHOLDERS
JUNE 19, 1996
767 Fifth Avenue
New York, New York 10153
The undersigned hereby appoints KENNETH B. CUTLER, ROBERT S. DOW and
RONALD P. LYNCH and each of them proxies, with full power of substitution, to
vote (according to the number of votes which the undersigned would be entitled
to cast if then personally present) at the special meeting of shareholders of
LORD ABBETT SECURITIES TRUST (the "Fund") on June 19, 1996, including all
adjournments, as specified below, and in their discretion upon such other
business as may properly be brought before the meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES WHICH RECOMMENDS THAT
YOU VOTE FOR PROPOSALS 1, 2 AND 3.
UNLESS OTHERWISE SPECIFIED IN THE SQUARES PROVIDED, THE VOTE OF THE UNDERSIGNED
IS TO BE CAST FOR ALL PROPOSALS LISTED BELOW.
1. For [_] Against [_] Abstain [_] To ratify the selection of Deloitte &
Touche LLP as independent public accountants of the Fund for the fiscal
year ending October 31, 1996.
2. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
changes in the Series' fundamental investment policies and restrictions,
as described in the proxy statement.
3. For [_] Against [_] Abstain [_] To approve or disapprove the proposed
new Distribution Plan and Agreement for the Series' existing class of
shares pursuant to Rule 12b-1 under the Investment Company Act of 1940,
as described in the proxy statement.
<PAGE>
ACCOUNT NUMBER SHARES PROXY NUMBER
LORD ABBETT SECURITIES TRUST
LORD ABBETT GROWTH &
INCOME TRUST
PLEASE SIGN, DATE AND MAIL THIS PROXY IN THE POSTAGE PAID RETURN ENVELOPE
PROVIDED.
For information as to the voting of stock registered in more than one name, see
page 1 of the proxy statement. When signing the proxy as attorney, executor,
administrator, trustee or guardian, please indicate the capacity in which you
are acting. Only autho rized officers should sign for corporations.
Date:......................................................
Signature(s) of Shareholder(s) as shown at left
.............................................................
.............................................................
(Please read other side)
2
