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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:
[ ] 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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<PAGE> 2
HERITAGE U.S. GOVERNMENT INCOME FUND
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
FEBRUARY 26, 1999
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 26, 1999
at 8:30 a.m. Eastern time, or any adjournment(s) thereof, at 880 CARILLON
PARKWAY, TOWER 3 CLASSROOM 1, ST. PETERSBURG, FL 33716, for the following
purposes:
(1) To elect two (2) trustees to serve terms as described herein,
until their successors are elected and qualified;
(2) To ratify the selection of PricewaterhouseCoopers LLP as
independent accountants of the Fund for the fiscal year ending October 31,
1999; 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 22, 1999. 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 25, 1999
880 Carillon Parkway
St. Petersburg, Florida 33716
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card, date
and sign the card, and return the card in the envelope provided. If you sign,
date and return the proxy card 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.
<PAGE> 3
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 26, 1999
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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 card first will be mailed to shareholders on or about January 25,
1999.
A majority of the shares of the Fund outstanding on January 22, 1999
("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 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. However, if the Fund has received a shareholder proposal to be
presented to shareholders at the Meeting prior to December 1, 1998, the duly
appointed proxies do not have the discretionary authority to vote upon such
proposals. Your proxy card may be revoked by giving another proxy, by letter or
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
<PAGE> 4
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
2001 annual meeting of shareholders.
Proposal 1 relates to the election of Class I Trustees (the "Nominees").
All of the Trustees, including the Nominees for Class I Trustees, are listed
below. These Nominees have served as Class I 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 proxy
card. Each of the two 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.
<TABLE>
<CAPTION>
SHARES OF
BENEFICIAL
POSITION WITH INTEREST OWNED
NAME, AGE AND BUSINESS EXPERIENCE DURING PAST FIVE YEARS THE FUND AS OF 10/31/98
-------------------------------------------------------- --------------- --------------
<S> <C> <C>
CLASS I:
DONALD W. BURTON* (54) Trustee --
President of South Atlantic Capital Corporation (venture
capital) since October 1981.
DAVID M. PHILLIPS (59) 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:
JAMES L. PAPPAS (55) 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.
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
SHARES OF
BENEFICIAL
POSITION WITH INTEREST OWNED
NAME, AGE AND BUSINESS EXPERIENCE DURING PAST FIVE YEARS THE FUND AS OF 10/31/98
-------------------------------------------------------- --------------- --------------
<S> <C> <C>
RICHARD K. RIESS* (49) Trustee --
Executive Vice President and Managing Director for Asset
Management of Raymond James Financial, Inc. ("RJF") since
1998; Chief Executive Officer of Eagle Asset Management,
Inc. ("Eagle") since 1996; President of Eagle, since 1995;
Chief Operating Officer of Eagle, 1988 to 1995; Executive
Vice President of Eagle, 1988-1993.
CLASS III:
THOMAS A. JAMES* (56) Trustee and --
Chairman of the Board since 1986, and Chief Executive Chairman of
Officer since 1969 of RJF; Chairman of the Board of Raymond the Board
James & Associates, Inc. since 1969; Chairman of the Board
since 1984 and Chief Executive Officer from 1994 to 1996 of
Eagle.
C. ANDREW GRAHAM (58) Trustee --
Vice President of Financial Designs Ltd. since 1992;
Executive Vice President of the Madison Group, Inc., October
1991-1992; Principal of First Denver Financial Corporation
(investment banking) since 1987.
ERIC STATTIN (65) Trustee --
Litigation consultant/expert witness and private investor
since February 1988.
</TABLE>
- ---------------
* Messrs. James, Riess and Burton are "interested persons" of the Fund as
defined in section 2(a)(19) of the Investment Company Act of 1940, as amended
("1940 Act") as a result of their affiliation with Raymond James and
Associates, Inc.
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, 1998, and except for David
M. Phillips, 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. 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.
3
<PAGE> 6
For the 1999 fiscal year, the Fund will pay each Trustee who is not an
employee of Heritage or an employee of an affiliate of Heritage an annual fee of
$667 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, 1998.
<TABLE>
<CAPTION>
TOTAL
PENSION OR COMPENSATION
AGGREGATE RETIREMENT ESTIMATED FROM THE FUND
COMPENSATION BENEFITS ACCRUED ANNUAL BENEFITS AND THE HERITAGE
FROM THE AS PART OF THE UPON FAMILY OF FUNDS
NAME OF PERSON POSITION FUND FUND'S EXPENSES RETIREMENT PAID TO TRUSTEES
- ----------------------- ------------ ---------------- --------------- ----------------
<S> <C> <C> <C> <C>
Donald W. Burton, Trustee $1,635 $0 $0 $20,000
C. Andrew Graham, Trustee $1,635 $0 $0 $20,000
Thomas A. James, Trustee $ 0 $0 $0 $ 0
James L. Pappas, Trustee $1,635 $0 $0 $20,000
David M. Phillips, Trustee $1,135 $0 $0 $14,000
Richard K. Riess, Trustee $ 0 $0 $0 $ 0
Eric Stattin, Trustee $1,635 $0 $0 $20,000
</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, 1998, all filing requirements applicable to
such persons were met.
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.
PROPOSAL 2: RATIFICATION OF SELECTION OF ACCOUNTANTS
Shareholders are requested to ratify the action of the Board in selecting
the firm of PricewaterhouseCoopers LLP as the independent accountants for Fund
for the fiscal year ending October 31, 1999. The Board believes that the firm is
well qualified and has accordingly selected PricewaterhouseCoopers LLP to act as
independent accountants, subject to ratification of Fund shareholders. Price
Waterhouse LLP has been the Fund's independent accountants since 1996. On July
1, 1998, Price Waterhouse LLP merged with Coopers & Lybrand LLP to form
PricewaterhouseCoopers LLP.
PricewaterhouseCoopers LLP has informed the Fund that it has no material
direct or indirect financial interest in the Fund. Representatives of
PricewaterhouseCoopers 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.
4
<PAGE> 7
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.
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 a
wholly owned subsidiary of 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.
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 39, President. Mr. Hill has been a director
since December 1994 and the Chief Executive Officer and President of
Heritage since April 1989.
H. PETER WALLACE, age 52, 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 41, Treasurer. Mr. Glassman has been
Treasurer of Heritage and Treasurer of Heritage Mutual Funds since May
1989.
CLIFFORD J. ALEXANDER, age 55, 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 33716. Any shareholder proposals to be included
in the Fund's proxy statement must be received by the Fund no later than October
31, 1999. All other shareholder proposals must be received by the Fund no later
than December 12, 1999.
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.
5
<PAGE> 8
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 25, 1999
IT IS IMPORTANT THAT YOU VOTE AND RETURN YOUR PROXY PROMPTLY.
6
<PAGE> 9
PROXY
HERITAGE U.S. GOVERNMENT INCOME FUND
ANNUAL MEETING OF SHAREHOLDERS - FEBRUARY 26, 1999
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 I Trustees:
Donald W. Burton, David M. Phillips
FOR _______ AGAINST _______ ABSTAIN ______
FOR, except vote withheld from the following nominee(s):
__________________________________________________
2. Ratification of the selection of PricewaterhouseCoopers LLP as independent
accountants of the Fund for the fiscal year ending October 31, 1999.
FOR _______ AGAINST _______ ABSTAIN ______
This proxy will not be voted unless it is dated and signed exactly as instructed
below.
Date
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Signature
----------------------------------
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."
