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
-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or
ss. 240.14a-12
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HERITAGE U.S. GOVERNMENT INCOME FUND
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Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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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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HERITAGE U.S. GOVERNMENT INCOME FUND
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
FEBRUARY 23, 1998
TO THE SHAREHOLDERS:
The annual meeting of the holders of shares of beneficial interest of the
Heritage U.S. Government Income Fund (the "Fund") will be on February 23, 1998
at 9:00 a.m. Eastern time, or any adjournment(s) thereof, at 100 Carillon
Parkway, Suite 280 Classroom A, St. Petersburg, FL 33716, for the following
purposes:
(1) To elect three (3) trustees to serve terms as described herein,
until their successors are elected and qualified;
(2) To ratify the selection of Price Waterhouse LLP as independent
accountants of the Fund for the fiscal year ended October 31, 1998;
and
(3) To transact such other business as may properly come before the
Annual Meeting or any adjournment(s) thereof.
You are entitled to vote at the meeting and any adjournment(s) thereof if
you owned shares of the Fund at the close of business on January 9, 1998. 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
January __, 1998
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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<PAGE>
HERITAGE U.S. GOVERNMENT INCOME FUND
880 Carillon Parkway
St. Petersburg, Florida 33716
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PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON FEBRUARY 23, 1998
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INTRODUCTION
This is a proxy statement with respect to Heritage U.S. Government Income
Fund (the "Fund") in connection with the solicitation of proxies made by, and on
behalf of, the Fund's Board of Trustees, to be used at the Fund's annual meeting
of shareholders or any adjournment(s) thereof ("Meeting"). This proxy statement
and proxy first will be mailed to shareholders on or about January 15, 1998.
A majority of the shares of the Fund outstanding on January 9, 1998
("Record Date") represented in person or by proxy, must be present to constitute
a quorum 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.
An abstention is a proxy that is properly executed, returned and
accompanied by instructions withholding authority to vote. 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 or with
respect to which the broker does not have discretionary voting authority.
Abstentions and broker non-votes are counted as votes present for purposes of
determining whether the requisite quorum exists. Approval of Proposals No. 1 and
No. 2 requires a plurality or majority of the votes cast on the matter. As a
result, abstentions and broker non-votes will have no effect on the outcome of
the proposals because abstentions and broker non-votes are votes not cast and,
as such, they have no impact on whether a proposal has received a majority of
the votes cast.
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 by you or by your duly appointed agent or
attorney-in-fact. If you sign, date and return the proxy card, but 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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<PAGE>
telegram revoking your proxy if received by the Fund prior to the Meeting, or by
appearing and voting at the Meeting.
As of the Record Date, the Fund had 3,115,471 shares outstanding and no
shareholder held of record or owned beneficially more than 5% of the issued and
outstanding shares of the Fund. All costs associated with the Meeting, including
the solicitation of proxies, will be borne by the Fund. Solicitations will be
made primarily by mail but also may include telephone communications by regular
employees of Heritage Asset Management, Inc. ("Heritage"), 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 AND SEMI-ANNUAL
REPORTS 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. ELECTION OF TRUSTEES
Pursuant to the provisions of the Fund's Declaration of Trust, the
Trustees have determined that the number of Trustees is fixed at seven. The
Declaration of Trust requires that the Trustees be elected by Class, with each
Class serving for three years after completion of an initial term. The Fund
currently has three Classes of Trustees. There are two Class I Trustees, two
Class II Trustees and three Class III Trustees. Class I Trustees' terms will
expire at the 1999 annual meeting of shareholders; Class II Trustees' terms will
expire at the 2000 annual meeting of shareholders; and Class III Trustees' terms
will expire at the 1998 annual meeting of shareholders.
Proposal 1 relates to the election of Class III Trustees (the "Nominees").
All of the Trustees, including the Nominees for Class III Trustees, are listed
below. These Nominees have served as Class III Trustees since the organization
of the Fund in 1993. If elected, each Nominee will hold office for three years
or until a successor is elected and qualified. Your proxy will be voted for the
election of the Nominees unless you give contrary instructions in the form of
proxy. Each of the three nominees has indicated his willingness to serve if
elected. If any Nominee should withdraw or otherwise become unavailable for
election due to unforeseen events, the proxies will vote for such other Nominee
or Nominees as the Board may recommend unless the Board reduces the number of
trusteeships.
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SHARES OF
BENEFICIAL
NAME, AGE AND BUSINESS EXPERIENCE DURING PAST POSITION WITH INTEREST OWNED
FIVE YEARS THE FUND AS OF 10/31/97
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CLASS I:
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DONALD W. BURTON (53) Trustee ---
President of South Atlantic Capital Corporation
(venture capital) since October 1981.
DAVID M. PHILLIPS (58) Trustee ---
Chairman and Chief Executive Officer of CCC
Information Services, Inc. since 1994 and of
InfoVest Corporation (information services to
the insurance and auto industries and consumer
households) since October 1982.
CLASS II:
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JAMES L. PAPPAS (54) Trustee ---
Dean of College of Business Administration
from August 1987 to 1996 and Lykes Professor
of Banking and Finance since August 1986 at
University of South Florida, Tampa, Florida.
RICHARD K. RIESS* (48) Trustee ---
President from 1995 to present, Chief
Executive Officer from 1996 to present, Chief
Operating Officer from 1988 to 1996, and
Executive Vice President from 1988 to 1994 of
Eagle Asset Management, Inc. ("Eagle").
CLASS III:
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THOMAS A. JAMES* (55)
Chairman of the Board since 1986, and Chief Trustee and ---
Executive Officer since 1969 of Raymond James Chairman of
Financial, Inc. ("RJF"); Chairman of the Board the Board
of Raymond James & Associates, Inc. since
1969; Chairman of the Board since 1984 and
Chief Executive Officer from 1994 to 1996 of
Eagle.
C. ANDREW GRAHAM (57) Trustee ---
Vice President of Financial Designs Ltd. since
1992; Executive Vice President of the Madison
Group, Inc., October 1991-1992.
ERIC STATTIN (64) Trustee ---
Litigation consultant/expert witness and
private investor since February 1988.
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*Messrs. James and Riess are "interested persons" of the Fund as defined
in section 2(a)(19) of the Investment Company Act of 1940, as amended
("1940 Act").
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Each of the above-referenced Trustees also serves as Trustee for Heritage
Capital Appreciation Trust, Heritage Cash Trust, Heritage Income Trust, Heritage
Income-Growth Trust and Heritage Series Trust (the Fund and these investment
companies are collectively referred to herein as the "Heritage Family of
Funds"). All Trustees and officers of the Fund as a group own beneficially less
than 1% of the shares outstanding on the Record Date. The Board of Trustees met
four times during the fiscal year ended October 31, 1997, and except for David
M. Phillips and Richard K. Riess, each Trustee attended at least 75% of those
meetings. The Board has an Audit Committee that reviews and evaluates the audit
function and that consists of the Trustees who are not "interested persons" of
the Trust as defined in the 1940 Act ("Independent Trustees") (currently,
Messrs. Burton, Graham, Pappas, Phillips and Stattin). The Audit Committee met
once during the Fund's last fiscal year and all members attended. The Fund does
not have Nominating or Compensation Committees.
For the 1998 fiscal year, the Fund will pay Independent Trustees $666.67
annually and $250 per meeting of the Board of Trustees. Trustees also are
reimbursed for any expenses incurred in attending Board meetings. Because
Heritage performs substantially all of the services necessary for the operation
of the Fund, the Fund requires no employees. No officer, director or employee of
Heritage receives any compensation from the Fund for acting as a Trustee or
officer. The following table shows the compensation earned by each Trustee for
the fiscal year ended October 31, 1997.
<TABLE>
<CAPTION>
Pension or Total Compensation
Retirement From the Fund
Aggregate Benefits Accrued Estimated Annual and the Heritage
Compensation as Part of the Benefits Upon Family of Funds
Name of Person Position From the Fund Fund's Expenses Retirement Paid to Trustees
- ----------------------- ------------- --------------- ---------- ----------------
<S> <C> <C> <C> <C>
Donald W. Burton, Trustee $1,454 $0 $0 $16,000
C. Andrew Graham, Trustee $1,454 $0 $0 $16,000
David M. Phillips, Trustee $1,090 $0 $0 $12,000
Eric Stattin, Trustee $1,454 $0 $0 $16,000
James L. Pappas, Trustee $1,272 $0 $0 $14,000
Richard K. Riess, Trustee $ 0 $0 $0 $ 0
Thomas A. James,Trustee $ 0 $0 $0 $ 0
</TABLE>
The Fund's officers and Trustees, persons owning more than 10% of the
Fund's common stock and certain officers of Heritage are required by law to
report their transactions in the Fund's shares to the Securities and Exchange
Commission, the New York Stock Exchange and the Fund. Based solely on the Fund's
review of copies of such reports received by it, the Fund believes that, during
the fiscal year ended October 31, 1997, all filing requirements applicable to
such persons were met.
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VOTE REQUIRED
Trustees must be elected by a plurality of the votes cast at the Meeting
in person or by proxy.
THE BOARD OF TRUSTEES
RECOMMENDS THAT YOU VOTE FOR PROPOSAL 1.
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PROPOSAL 2: RATIFICATION OF SELECTION OF ACCOUNTANTS
The Fund's financial statements for the fiscal years ended October 31,
1996, and October 31, 1997 were audited by Price Waterhouse LLP, independent
accountants. The Board of Trustees has selected Price Waterhouse LLP as
independent accountants for the Fund for the fiscal year ending October 31,
1998, subject to termination of that position without penalty by either the
shareholders of the Fund or by the Trustees.
Price Waterhouse LLP has been the Fund's independent accountants since
1996. During 1996, the Independent Trustees accepted the resignation of Coopers
& Lybrand L.L.P. and appointed Price Waterhouse LLP as the Fund's independent
public accountants. Coopers & Lybrand L.L.P.'s reports for each of the two
fiscal periods ended October 31, 1995 did not contain any adverse opinion or
disclaimer of opinion, and were not qualified or modified as to uncertainty,
audit scope, or accounting principles. No disagreement occurred between Coopers
& Lybrand L.L.P. and the Fund during the aforementioned two periods with respect
to any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure.
Price Waterhouse LLP has informed the Fund that it has no material direct
or indirect financial interest in the Fund. Representatives of Price Waterhouse
LLP are not expected to be present at the meeting but have been given the
opportunity to make a statement if they so desire, and will be available should
any matter arise requiring their presence.
VOTE REQUIRED
A majority of the votes cast at the meeting in person or by proxy is
required for ratification.
THE BOARD OF TRUSTEES
RECOMMENDS THAT YOU VOTE FOR PROPOSAL 2.
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HERITAGE AND ITS AFFILIATES
Heritage serves as the Fund's investment adviser and administrator.
Heritage is a Florida corporation organized in 1985 and registered as an
investment adviser under the Investment Advisers Act of 1940. Heritage is wholly
owned by RJF. Thomas A. James, a Trustee, by virtue of his direct or indirect
ownership of RJF, owns beneficially more than 10% of Heritage. The principal
address of Heritage, RJF, Thomas A. James and each of Heritage's directors and
principal executive officers is at 880 Carillon Parkway, St.
Petersburg, Florida 33716.
6
<PAGE>
EXECUTIVE OFFICERS
Officers of the Fund are appointed by the Trustees and serve at the
pleasure of the Board. None of the Fund's officers currently receives any
compensation from the Fund. All officers as a group own beneficially less than
1% of the shares outstanding on the Record Date. The executive officers of the
Fund are:
STEPHEN G. HILL, age 38, PRESIDENT. Mr. Hill has been a director and the
Chief Executive Officer and President of Heritage since April 1989.
H. PETER WALLACE, age 51, VICE PRESIDENT. Mr. Wallace has been a Senior
Vice President and Director of Fixed Income Investments of Heritage since
January 1993. Mr. Wallace also served as Vice President of Mortgage Products of
Donaldson, Lufkin & Jenrette from 1990 to 1992.
DONALD H. GLASSMAN, age 40, TREASURER. Mr. Glassman has been Treasurer of
Heritage and Treasurer of Heritage Mutual Funds since May 1989.
CLIFFORD J. ALEXANDER, age 54, SECRETARY. Mr. Alexander is a partner at
Kirkpatrick & Lockhart LLP.
SHAREHOLDER PROPOSALS
The Fund holds a meeting of shareholders each year. Any shareholder who
wishes to submit proposals to be considered at the next annual 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 by the Fund no
later than October 31, 1998.
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.
OTHER BUSINESS
Management knows of no other business to be presented at the Meeting other
than the matters 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
January __, 1998
IT IS IMPORTANT THAT YOU VOTE AND RETURN YOUR PROXY PROMPTLY.
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PROXY
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HERITAGE U.S. GOVERNMENT INCOME FUND
ANNUAL MEETING OF SHAREHOLDERS - FEBRUARY 23, 1998
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"
1. Election of Class III Trustees:
Thomas A. James, C. Andrew Graham, and Eric Stattin
FOR _______ AGAINST _______ ABSTAIN ______
FOR, except vote withheld from the following nominee(s):
_______________________________________
2. Ratification of the selection of Price Waterhouse LLP as independent
accountants of the Fund for the fiscal year ending October 31, 1998.
FOR _______ AGAINST _______ ABSTAIN ______
This proxy will not be voted unless it is dated and signed exactly as instructed
below.
Signature_______________________________
Date: ______________________ Signature_______________________________
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."
