<PAGE>
SCHEDULE 14A
Information Required in Proxy Statement
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
(Amendment No. 1)
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 (S)240.14a-11(c) or (S)240.14a-12
MassMutual Institutional Funds
- ------------------------------------------------------------------------------
(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), 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 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
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>
[LOGO FOR MASS MUTUAL APPEARS HERE]
October 4, 1996
Dear Shareholder:
You are cordially invited by the Board of Trustees of MassMutual Institutional
Funds (the "Trust"), on behalf of MassMutual Prime Fund, MassMutual Short-term
Bond Fund, MassMutual Core Bond Fund, MassMutual Balanced Fund, MassMutual Value
Equity Fund, MassMutual Small Cap Value Equity Fund, and MassMutual
International Equity Fund (the seven series of the Trust are hereinafter
referred to collectively as the "Funds"), to attend a Special Meeting of the
Trust's shareholders. The Special Meeting will be held Wednesday, October 16,
1996 at Massachusetts Mutual Life Insurance Company, 1295 State Street,
Springfield, Massachusetts, commencing at 9:30 a.m. (EST).
At the Special Meeting, all shareholders of the Trust will be asked to elect
members to the Board of Trustees; to ratify the appointment of the Trust's
independent auditors for the fiscal year ending December 31, 1996; and to
transact such other business as may properly be brought before the Special
Meeting. Shareholders of MassMutual Balanced Fund, MassMutual Value Equity Fund
and MassMutual Small Cap Value Equity Fund will also each be asked to approve a
new investment sub-advisory agreement for their respective Fund.
Important information is contained in the accompanying Proxy Statement, which
you are urged to read carefully. It is important that your shares are
represented and voted at the Special Meeting, regardless of the number you own.
Accordingly, you are requested to mark, sign, date and return the enclosed Proxy
Instructions Forms (a Proxy Instruction Form is enclosed for each Fund in which
you own shares) in the envelope provided so that it is received prior to the
Special Meeting.
Your interest and participation in the affairs of the Trust are greatly
appreciated.
Sincerely,
/s/ Stuart H. Reese
Stuart H. Reese
President
MassMutual Institutional Funds
<PAGE>
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
To Be Held October 16, 1996
and
PROXY STATEMENT
for
MASSMUTUAL INSTITUTIONAL FUNDS
Your vote is important. Please date, complete, and sign the enclosed Proxy
Instruction Forms and mail them in the enclosed return envelope which
requires no postage if mailed in the United States.
<PAGE>
MASSMUTUAL INSTITUTIONAL FUNDS
1295 State Street
Springfield, Massachusetts 01111
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
To be Held October 16, 1996
To the Shareholders:
A Special Meeting of Shareholders of MassMutual Institutional Funds (the
"Trust") will be held at the office of the Trust, 1295 State Street,
Springfield, Massachusetts, at 9:30 a.m., Springfield time, Wednesday, October
16, 1996 for the following purposes:
1. Approval of Investment Sub-Advisory Agreements (shareholders of
MassMutual Value Equity Fund, MassMutual Small Cap Value Equity Fund,
and MassMutual Balanced Fund only).
2. Election of Richard H. Ayers, David E. A. Carson , Richard G. Dooley,
Richard W. Greene, Beverly C. L. Hamilton, and F. William Marshall,
Jr. as Trustees (all shareholders).
3. Ratification of the selection of Coopers & Lybrand L.L.P. as auditors
for the fiscal year ending December 31, 1996 (all shareholders).
Only shareholders of record at the close of business on September 12, 1996
are entitled to notice of and to vote at this meeting and any adjournment
thereof.
By Order of the Board of Trustees,
STEPHEN L. KUHN
Vice President and Secretary
Springfield, Massachusetts
October 4, 1996
-1-
<PAGE>
MASSMUTUAL INSTITUTIONAL FUNDS
1295 State Street
Springfield, Massachusetts 01111
PROXY STATEMENT
General Information
The enclosed proxy is solicited by and on behalf of the Board of Trustees
of MassMutual Institutional Funds (the "Trust") in connection with a Special
Meeting of Shareholders to be held at 1295 State Street, Springfield,
Massachusetts, at 9:30 a.m., October 16, 1996 (the "Special Meeting") for the
purposes described below. The cost of preparing and mailing this Proxy
Statement, the Notice of Special Meeting, the Proxy Instruction Forms and any
additional material which may hereafter be furnished in connection with the
solicitation of proxies will be paid by Massachusetts Mutual Life Insurance
Company ("MassMutual") pursuant to the terms of its Administrative and
Shareholder Services Agreements with the Trust, on behalf of MassMutual Prime
Fund ("Prime Fund"), MassMutual Short-Term Bond Fund ("Short-Term Bond Fund"),
MassMutual Core Bond Fund ("Core Bond Fund"), MassMutual Balanced Fund
("Balanced Fund"), MassMutual Value Equity Fund ("Value Equity Fund"),
MassMutual Small Cap Value Equity Fund ("Small Cap Value Equity Fund"), and
MassMutual International Equity Fund ("International Equity Fund") (the seven
series of the Trust, hereinafter referred to collectively as the "Funds").
This Proxy Statement and the enclosed Proxy Instruction Forms were first
sent to shareholders on or about October 4, 1996. A shareholder giving the proxy
has the power to revoke it at any time before it is exercised. A proxy may be
revoked only by the Trust's receipt of a signed and dated written notice of
revocation, by filing a duly executed Proxy Instruction Form bearing a later
date, or by attending the Special Meeting and voting in person.
The Special Meeting will be held for the following purposes:
<TABLE>
<CAPTION>
Proposal Shareholders Solicited
------------------------- ----------------------
<S> <C>
(1) Approval of Investment Shareholders of Value Equity Fund,
Sub-Advisory Agreements Small Cap Value Equity Fund,
and Balanced Fund only
(2) Election of Richard H. Ayers, All shareholders
David E. A. Carson, Richard G. Dooley,
Richard W. Greene, Beverly C. L.
Hamilton and F. William Marshall, Jr.
as Trustees
</TABLE>
-2-
<PAGE>
(3) Ratification of the selection of All shareholders
Coopers & Lybrand L.L.P. as
auditors for the fiscal year ending
December 31, 1996
To be entitled to notice of and to vote at the Special Meeting, a
shareholder must have owned shares of the Trust as of the close of business on
September 12, 1996 (the "Record Date"). Shareholders entitled to vote shall
have one vote for each share of the Trust owned and a proportionate fractional
vote for each fractional share owned. Proxy Instruction Forms are enclosed for
this purpose. On the Record Date, there were 317,942,369.27 votes eligible to be
cast at this meeting, attributable to each Fund as follows:
Prime Fund: 1,535,470.40 shares
Short-Term Bond Fund: 13,343,403.33 shares
Core Bond Fund: 30,752,701.81 shares
Balanced Fund: 41,884,702.61 shares
Value Equity Fund: 167,208,460.54 shares
Small Cap Value Equity Fund: 34,223,488.57 shares
International Equity Fund: 28,994,142.01 shares
Quorum and Vote Required
- ------------------------
With respect to Proposal 1, shareholders of Balanced Fund, Value Equity
Fund and Small Cap Value Equity Fund will vote separately by Fund and a majority
vote of the shares of a Fund is necessary to approve such Proposal for that
Fund./1/ Pursuant to the Trust's Agreement and Declaration of Trust (the
"Declaration of Trust"), shares representing 30% of the votes of a Fund entitled
to vote on Proposal 1 shall constitute a quorum for the transaction of business
with respect to Proposal 1 by that Fund.
With respect to Proposals 2 and 3, the Trust's Declaration of Trust
provides that the election of each Trustee requires a plurality of all shares
voted and that an affirmative vote of the holders of a majority of the Trust's
shares properly cast is necessary to ratify the selection of independent
accountants, provided that a quorum is present. Under the Declaration of Trust,
shares representing 30% of the votes of the Trust entitled to vote, present in
person or represented by proxy, constitutes a quorum for the transaction of
business with respect to Proposals 2 and 3 at the Special Meeting.
Votes cast by proxy or in person at the Special Meeting will be counted by
persons appointed by the Trust to act as election inspectors for the Special
Meeting. The election
- -------------------------------------
/1/ As used in this Proxy Statement "majority vote" means the affirmative
vote of at least 67% of the voting shares of a Fund present at the Special
Meeting (provided that more than 50% of the outstanding voting shares of the
Fund are present or represented by proxy at the Special Meeting) or more than
50% of the outstanding voting shares of the Fund, whichever is less.
-3-
<PAGE>
inspectors will count the total number of votes cast "for" approval of the
Proposals for purposes of determining whether sufficient affirmative votes have
been cast. The election inspectors will count shares represented by proxies that
withhold authority to vote for a nominee for election as a Trustee or that
reflect abstentions as shares that are present and entitled to vote on the
matter for purposes of determining the presence of a quorum. With respect to
Proposal 1, an abstention from voting has the effect of a negative vote. With
respect to Proposal 2, withholding a vote or an abstention from voting has no
effect on the outcome of the vote or Proposal. With respect to Proposal 3, an
abstention from voting has no effect on the outcome of the vote or Proposal.
A copy of the Trust's Annual Report for the fiscal year ended December 31,
1995 and a copy of the Trust's Semi-Annual Report for the semi-annual period
ended June 30, 1996 are each available without charge upon request and may be
obtained by calling 1-800-542-6767 or by writing the Trust at the address
above.
PROPOSAL (1)
APPROVAL OF NEW INVESTMENT SUB-ADVISORY AGREEMENTS
BETWEEN MASSMUTUAL AND DAVID L. BABSON & COMPANY
Description of Investment Management Agreements
- -----------------------------------------------
MassMutual is the investment manager of the Funds pursuant to seven,
substantially identical, Investment Management Agreements with the Trust, on
behalf of each of the seven Funds (the "Management Agreements"). The Management
Agreements were last approved by MassMutual as the sole initial shareholder of
the Trust on September 26, 1994 in connection with the commencement of the
Trust's operations. The Management Agreements were last approved, in person, by
the Board of Trustees, including a majority of those members of the Board who
are not parties to the Management Agreements or "interested persons" of any such
party, at a meeting called for the purpose of voting on such approval on May 3,
1996. No change is being made to the terms of the Management Agreements.
Under the terms of the Management Agreements, MassMutual acts as investment
adviser and manager to each of the Funds subject to such general or specific
instructions as may be given by the Board of Trustees. The terms of the
Management Agreements permit MassMutual to enter into investment sub-advisory
agreements for the provision of investment advisory services to each of the
Funds. Under the Management Agreements, MassMutual's liability regarding its
investment management obligations and duties is limited to situations involving
its willful misfeasance, bad faith, gross negligence or reckless disregard of
such obligations and duties.
A Management Agreement may be terminated: (1) by the Trust at any time
without penalty on 60 days' notice, provided that such termination has been
directed or approved by a majority of all of the Trustees of the Trust then in
office or by majority vote of the shares of the relevant Fund; or (2) for cause
or with the consent of the parties and the Trust by the Trust or MassMutual at
any time without penalty upon 60 days' written notice to the other party and the
-4-
<PAGE>
Trust. In addition, the Management Agreements automatically terminate: (1)
unless their continuance is specifically approved, at least annually, by the
affirmative vote of a majority of the Board of Trustees, which vote shall
include a majority of the Board members who are not "interested persons" of the
Trust or of MassMutual, or by the affirmative vote of a majority of each Fund's
shares; or (2) upon assignment thereof.
For its services rendered under the Management Agreements, MassMutual is
paid at an annual rate of the average daily net assets of each Fund as follows:
.45% for Prime Fund, the Short-Term Bond Fund, the Core Bond Fund, the Balanced
Fund and the Value Equity Fund; .55% for the Small Cap Value Equity Fund; and
.85% for the International Equity Fund. For the fiscal year ended December 31,
1995, the Funds have paid the following amounts as investment advisory fees to
MassMutual pursuant to the Management Agreements:
<TABLE>
<CAPTION>
Gross Investment Amount of Net
Fund Advisory Fees Earned Fees Waived Fees Paid
- ---- -------------------- ------------ ---------
<S> <C> <C> <C>
Prime Fund $1,027,586 $(70,814) $956,772
Short-Term Bond Fund 528,655 (39,446) 489,209
Core Bond Fund 964,830 (91,069) 873,761
Balance Fund 1,801,770 (165,250) 1,636,520
Value Equity Fund 8,289,231 (852,771) 7,436,460
Small Cap Value Equity Fund 1,928,743 (155,450) 1,733,293
International Equity Fund 1,580,088 (170,788) 1,409,300
Total for All Funds $16,120,903 $(1,545,588) $14,575,315
=========== =========== ===========
</TABLE>
In addition to being the Funds' investment manager, MassMutual also
provides investment advisory or sub-advisory services to the following
registered investment companies.
<TABLE>
<CAPTION>
Total Net Assets
Name of as of
Investment Company December 31, 1995 Rate of Compensation
- ------------------ ----------------- --------------------
<S> <C> <C>
MassMutual Corporate $168,563,044 MassMutual receives a quarterly base
Investors ("CI") rate of 5/16 of 1% of the value of CI's
net assets as of the end of each fiscal
quarter (approximately 1.25% on an
annual basis), plus or minus a quarterly
performance adjustment of up to 1/16 of 1%.
</TABLE>
-5-
<PAGE>
<TABLE>
<CAPTION>
Total Net Assets
Name of as of
Investment Company December 31, 1995 Rate of Compensation
- ------------------ ----------------- --------------------
<S> <C> <C>
MassMutual $95,286,143 MassMutual receives a quarterly advisory
Participation Investors and administrative service fee equal to
("PI") .225% of the value of PI's net assets as of
the last business day of each fiscal quarter
(approximately .90% on an annual basis).
MML Managed $158,698,930 MassMutual receives from each of MML
Bond Fund Equity Fund, MML Money Market Fund,
MML Blend Fund $1,823,140,930 MML Managed Bond Fund and MML Blend Fund a
MML Equity Fund $1,248,899,006 quarterly fee at the annual rate of .50%
MML Money Market $108,920,210 of the first $100 million of such fund's
Fund average net asset value, .45% of the next
$200 million, .40% of the next $200 million,
and .35% of any excess over $500 million.
</TABLE>
Description of Present Investment Sub-Advisory Agreements
- ---------------------------------------------------------
MassMutual and Concert Capital Management, Inc. ("Concert Capital"), an
indirect wholly-owned subsidiary of MassMutual, have entered into three,
substantially identical investment sub-advisory agreements, each dated September
30, 1994, whereby Concert Capital provides investment advisory services to the
Value Equity Fund, the Small Cap Value Equity Fund and the Value Equity Sector
of the Balanced Fund (the "Present Sub-Advisory Agreements")./2/ The Present
Sub-Advisory Agreements were last approved by MassMutual as the sole initial
shareholder of the Value Equity Fund, the Small Cap Value Equity Fund, and the
Balanced Fund on September 26, 1994, in connection with the commencement of the
Trust's operations. The Present Sub-Advisory Agreements were last approved, in
person, by the Board of Trustees, including a majority of those members of the
Board who are not parties to the Sub-Advisory Agreements or "interested persons"
of any such party, at a meeting called for the purpose of voting on such
approval on May 3, 1996.
Under the Present Sub-Advisory Agreements, Concert Capital's liability
regarding its investment management obligations and duties is limited to
situations involving its willful misfeasance, bad faith, gross negligence or
reckless disregard of such obligations and duties. The Present Sub-Advisory
Agreements may be terminated: (1) by the Trust at any time without penalty on 60
days' notice, provided that such termination has been directed or approved by a
- -------------------------------
/2/ MassMutual has also entered into an investment sub-advisory agreement,
dated September 30, 1994, with HarbourView Asset Management Corporation
("HarbourView") whereby HarbourView provides investment advisory services to the
International Equity Fund. No action is being requested with respect to this
Agreement.
-6-
<PAGE>
majority of all of the Trustees of the Trust then in office or by majority vote
of the shares of the relevant Fund; or (2) for cause or with the consent of the
parties and the Trust by Concert Capital or MassMutual at any time without
penalty upon 60 days' written notice to the other party and the Trust. In
addition, the Present Sub-Advisory Agreements automatically terminate: (1)
unless their continuance is specifically approved, at least annually, by the
affirmative vote of a majority of the Board of Trustees, which vote shall
include a majority of the Board members who are not "interested persons" of the
Trust or of MassMutual, or by the affirmative vote of a majority of each Fund's
shares; (2) upon assignment thereof; or (3) upon termination of the underlying
Management Agreements.
For its services under the Present Sub-Advisory Agreements, Concert Capital
is entitled to receive from MassMutual a weekly fee equal to an annual rate of
.13% of the average daily net asset value of the Value Equity Fund and the Value
Equity Sector of the Balanced Fund, and .25% of the average daily net asset
value of the Small Cap Value Equity Fund, as of the close of each business day.
For the fiscal year ended December 31, 1995, the aggregate fees paid to Concert
Capital from MassMutual amounted to $3,529,653. The fees paid under the Present
Sub-Advisory Agreements for 1995 were $2,397,537 for the Value Equity Fund,
$873,629 for the Small Cap Value Equity Fund and $258,485 for the Value Equity
Sector of the Balanced Fund.
In addition to providing investment advisory services to the Value Equity
Fund, the Small Cap Value Equity Fund and the Value Equity Sector of the
Balanced Fund, Concert Capital has also entered into an investment sub-advisory
contract with: (1) Oppenheimer Value Stock Fund, which had net assets of
$163,046,323 as of December 31, 1995, whereby Concert Capital is paid a fee
equal to .40% of the first $50 million of average annual net assets and .20% of
the average annual net assets in excess of $50 million; and (2) MML Equity Fund
and the Equity Sector of MML Blend Fund, whereby Concert Capital is paid a
quarterly fee equal to an annual rate of .13% of the average daily net value of
MML Equity Fund and the Equity Sector of MML Blend Fund.
Description of the Proposed Investment Sub-Advisory Agreements
- --------------------------------------------------------------
MassMutual proposes to terminate the Present Sub-Advisory Agreements and
enter into three investment sub-advisory agreements with David L. Babson &
Company ("Babson"), whose address is One Memorial Drive, Cambridge,
Massachusetts 02142, whereby Babson would provide investment advisory services
to the Value Equity Fund, the Small Cap Value Equity Fund, and the Value Equity
Sector of the Balanced Fund (the "Proposed Sub-Advisory Agreements"). Except
for the change in sub-adviser, the terms of the Proposed Sub-Advisory Agreements
are identical in all material respects to those of the Present Sub-Advisory
Agreements, including with respect to duties, fees and the standard of care.
The form of the Proposed Sub-Advisory Agreements is set forth at Exhibit A.
Babson is a registered investment adviser that has provided investment
counseling to institutions and individuals for over 50 years. On June 30, 1995,
Babson became an indirect
-7-
<PAGE>
subsidiary of MassMutual. Babson's parent is DLB Acquisition Corporation ("DLB
Acquisition"), a wholly-owned indirect subsidiary of MassMutual. DLB Acquisition
is also the parent company of Concert Capital. Babson and Concert Capital intend
to merge their operations, with Babson being the surviving entity. As of
January, 1996, the employees of Concert Capital became co-employees of Babson.
Babson management currently intends that the employees of Concert Capital
currently responsible for providing daily investment advice to the Value Equity
Fund, the Small Cap Value Equity Fund, and the Value Equity Sector of the
Balanced Fund will continue to do so as employees of Babson.
Babson currently provides investment advisory services to the following
investment company portfolios that have investment objectives similar to the
Funds:
<TABLE>
<CAPTION>
Total Net Assets
Name of as of
Investment Company December 31, 1995 Rate of Commission
- ------------------ ----------------- ------------------
<S> <C> <C>
Babson Mutual Fund $865,456,204 Babson is paid at the annual rate of the
Group average daily net assets of each fund in the
(the "Babson Fund") Babson Fund as follows: .30% of the first
$100 million, .25% of the next $150
million, and .20% in excess of $250 million
of the Growth Fund; .70% of the first $30
million and .50% in excess of $30 million
of the Enterprise Fund and the Enterprise
Fund II; .35% for the Value Fund; and
.25% for the Shadow Stock Fund.
Babson-Stewart Ivory $71,574,912 Babson is paid at the annual rate of
International Fund .175% of the Fund's average daily net
assets.
DLB Fund Group $26,193,159 Babson is paid at the annual rate of the
(the "DLB Fund") average daily net assets of each fund in the
DLB Fund as follows: .40% for the Global
Small Cap Fund; .35% for the Value Fund;
and .30% for the Mid Cap Fund.
Select Advisors Variable $3,222,262 Babson is paid at the annual rate .50% of the
Insurance Trust average daily net assets of the Select
Advisors Portfolios Emerging Growth
Portfolio and the Select Advisors Variable
Insurance Trust Emerging Growth
Portfolio.
</TABLE>
-8-
<PAGE>
The Trustees of the Trust, including the Trustees who are not "interested
persons" of the Trust or of Babson, reviewed and approved the Proposed Sub-
Advisory Agreements in person at a meeting on August 2, 1996, and have directed
that they be submitted to the shareholders of the Value Equity Fund, the Small
Cap Value Equity Fund, and the Balanced Fund for their approval.
The Board of Trustees of the Trust recommend that the shareholders of the
Value Equity Fund, the Small Cap Value Equity Fund, and the Balanced Fund vote
FOR the Proposed Sub-Advisory Agreements to be entered into by and between
MassMutual and Babson. In making this recommendation, the Trustees have
considered information relating to the status of Concert Capital and Babson
following completion of their combination of operations, including Babson's
capabilities and expertise to serve as investment sub-adviser to the Value
Equity Fund, the Small Cap Value Equity Fund, and the Value Equity Sector of the
Balanced Fund. They have reviewed the terms of the Proposed Sub-Advisory
Agreements, including the fact that no change to the investment advisory fees of
the Value Equity Fund, the Small Cap Value Equity Fund, and the Balanced Fund is
being proposed.
Here are some of the factors you may wish to consider in determining
whether to approve the Proposed Sub-Advisory Agreements:
The Board of Trustees has approved the Proposed Sub-Advisory Agreements;
There will be no change in the Funds' investment objectives or investment
policies or in the duties of the investment adviser and sub-investment
adviser as a result of approval of the Proposed Sub-Advisory Agreements;
There will be no change in the fees payable by MassMutual for sub-advisory
services as a result of approval of the Proposed Sub-Advisory Agreements;
and
The Board of Trustees has been advised that Babson management currently
intends that no significant changes in the persons currently responsible
for providing daily investment advice to the Funds will be made by Babson
following approval of the Proposed Sub-Advisory Agreements.
PROPOSAL (2)
ELECTION OF TRUSTEES
The Board of Trustees is currently of the following eight Trustees: Gary E.
Wendlandt, Ronald J. Abdow, Mary E. Boland, Richard G. Dooley, F. William
Marshall, Jr., Charles J. McCarthy, John M. Naughton, and John H. Southworth.
All of the Trustees, other than Richard G. Dooley and F. William Marshall, Jr.,
serve until he or she dies, resigns or is removed. Richard G. Dooley and F.
William Marshall, Jr., have been nominated to stand for re-election at the
Special
-9-
<PAGE>
Meeting and will also serve, pursuant to the Trust's Declaration of Trust, for
indefinite terms if elected by the shareholders at the Special Meeting. On
August 2, 1996, the Board of Trustees of the Trust voted to increase the size of
the Board from eight to twelve Trustees. Richard H. Ayers, David E. A. Carson,
Richard W. Greene and Beverly C. L. Hamilton have been nominated to serve as
additional Trustees.
All nominees have consented to serve as Trustees of the Trust, if elected.
If any of the nominees for Trustees should for any reason become unavailable as
a candidate at the meeting, which is not now anticipated, votes pursuant to the
enclosed proxy will be cast for a substitute candidate in the discretion of
those persons named in the enclosed Proxy Instruction Forms. Pursuant to the
Trust's Declaration of Trust, a nominee elected by shareholders will serve as a
Trustee until he or she dies, resigns or is removed.
Nominees for election and re-election, Trustees whose election is not being
sought, and the executive officers of the Trust, together with their ages and a
brief description of their principal occupations during the past five years,
directorships in public companies, and their terms on the Board are set forth
below.
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- -----------------------------------------------------
<S> <C>
Gary E. Wendlandt* Chief Investment Officer (since 1993), Executive Vice
Age 45, Chairman, Chief President (since 1992), Senior Vice President (1983-1992),
Executive Officer and MassMutual; Chairman (since 1995), Vice Chairman
Trustee of the Trust (1993-1995) and President (1988-1993), NML Series
(since 1994) Investment Fund (open-end investment company); Chairman
(since 1995), President (1983-1995) and Trustee, MassMutual
Corporate Investors, and Chairman (since 1995), President
(1988-1995) and Trustee, MassMutual Participation Investors
(closed-end investment companies); President and Director
(since 1995), DLB Acquisition Corporation (holding company
for investment advisers); President and Chief Executive Officer
(since 1994), Director (since 1992), and Vice Chairman (1983-1992),
Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of MassMutual Holding Company);
Director (since 1990), Oppenheimer Acquisition Corporation
(investment advisory holding company); Supervisory Director
(since 1991) MassMutual/Carlson CBO N.V. (collateralized
bond fund); Director (since 1994), MassMutual Corporate
Value Partners Limited (investor in debt and equity
securities) and MassMutual Corporate Value Limited (parent
of MassMutual Corporate Value Partners Limited); Chairman,
President and
</TABLE>
- -------------------
* Trustee who is an "interested person" of the Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
-10-
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- --------------------------------------------------------
<S> <C>
Gary E. Wendlandt* (contd.) Chief Executive Officer (since 1994) and Director (since 1991),
MassMutual Holding Company and Director and
President (since 1994), MassMutual Holding Company Two,
Inc. and MassMutual Holding Company Two MSC, Inc.
(direct and indirect holding company subsidiaries of
MassMutual); Chairman (since 1994) and Director (since
1993), MML Realty Management Corporation; Chairman and
Chief Executive Officer (since 1994), Cornerstone Real Estate
Advisers, Inc. (wholly-owned real estate investment adviser
subsidiary of MassMutual Holding Company); Director (since
1992), Merrill Lynch Derivative Products, Inc.; Chairman
(1994-1995) and Director (1993-1995), MML Real Estate
Corporation.
Ronald J. Abdow President, Abdow Corporation (operator of restaurants);
Age 64, Trustee of General Partner, Grove Investment Group (apartment building
the Trust (since 1994) syndicator); Trustee, Abdow G&R Trust and Abdow
G&R Co. (owners and operators of restaurant properties);
Partner, Abdow Partnership, Abdow Auburn Associates, and
Abdow Hazard Associates (owners and operators of
restaurant properties); Trustee (since 1993) MML Series
Investment Fund (open-end investment company).
Richard H. Ayers Chairman and Chief Executive Officer (since 1989) and
Age 53, Nominee Director (since 1985), The Stanley Works (manufacturer of
tools, hardware and specialty hardware and specialty hardware
products); Director (since 1986), Southern New England
Telecommunications. Corp.; Director (since 1988), Perkin Elmer
Corp.; Director (1985-1996), Connecticut Mutual Investment
Accounts, Inc. and Connecticut Mutual Financial Services Series
Fund I, Inc.
Mary E. Boland Attorney at Law, Egan, Flanagan and Cohen, P.C., (law firm)
Age 57, Trustee of Springfield, MA; Director (since 1995), Trustee (until 1995),
the Trust (since 1994) SIS Bank (formerly, Springfield Institution for Savings);
Trustee, MML Series Investment Fund (open-end investment
company);
David E. A. Carson President and Chief Executive Office (since 1985), People's
Age 62, Nominee Bank; Director, United Illuminating Co.; Trustee, American
Skandia Trust (open-end investment company); Director (until 1996),
Connecticut Mutual Investment Accounts, Inc. and Connecticut
Mutual Financial Services Series I, Inc.
</TABLE>
- ---------------------
* Trustee who is an "interested person" of the Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
-11-
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- -----------------------------------------------------
<S> <C>
Richard G. Dooley* Consultant (since 1993), Executive Vice President and Chief
Age 67, Trustee of Investment Officer (1978-1993), MassMutual; Director, The
the Trust (since 1996) Advest Group, Inc. (financial services holding company),
and Nominee Hartford Steam Boiler Inspection and Insurance Co., New
England Education Loan Marketing Corporation; Trustee
(since 1992), Kimco Realty Corp. (shopping center ownership
and management); Director (since 1993), Jefferies Group, Inc.
financial services holding company), Director and Vice
President, Oppenheimer Acquisition Corporation (investment
advisory holding company); Vice Chairman (since 1995),
Chairman (1988-1995), MML Series Investment Fund (open-
end investment company); Vice Chairman (since 1995),
Chairman (1982-1995), MassMutual Corporate Investors, and
Vice Chairman (since 1995), Chairman (1988-1995),
MassMutual Participation Investors (closed-end investment
companies); Director (1992-1995), Chairman (1982-1992)
Concert Capital Management, Inc. (an indirect investment
advisory subsidiary of MassMutual); Director (1993-1995),
Luxonen S.A. (Swedish investment fund); Supervisory
Director (1991-1995), MassMutual/Carlson CBO N.V.
(collateralized bond fund); Director (1984-1993), MML Real
Estate Corporation (real estate management subsidiary of
MassMutual Holding Company) and MML Realty
Management Corporation (subsidiary of MassMutual Holding
Company to manage real estate projects).
Richard W. Greene Executive Vice President and Treasurer (since 1986),
Age 61, Nominee University of Rochester (private university); Director
(until 1996), Connecticut Mutual Investment Accounts, Inc.
and Connecticut Mutual Financial Services Series Fund
I, Inc.
Beverly C. L. Hamilton President (since 1991), ARCO Investment Management Co.;
Age 50, Nominee Vice President (since 1991), Atlantic Richfield Company;
Director (since 1992), Connecticut Natural Gas; Director
(since 1991), Emerging Markets Growth Fund (closed-end
investment company); Director (until 1996), Connecticut
Mutual Investment Accounts, Inc. and Connecticut Mutual
Financial Services Series Fund I, Inc.
</TABLE>
- ----------------------
* Trustee who is an "interested person" of the Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
-12-
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- -----------------------------------------------------
<S> <C>
F. William Marshall, Jr. President, Chief Executive Officer and Director (since 1993),
Age 54, Trustee of the SIS Bank (formerly, Springfield Institution for Savings);
Trust (since 1996), Chairman and Chief Executive Officer (1990-1993), Bank of
and Nominee Ireland First Holdings, Inc. and First New Hampshire Banks;
Trustee (since 1996), MML Series Investment Fund (open-end
investment company).
Charles J. McCarthy Proprietor, Synectics Financial Company (venture capital
Age 73, Trustee of activities, business consulting and investments); Trustee, MML
the Trust (since 1994) Series Investment Fund (open-end investment company).
John M. Naughton* Executive Vice President, MassMutual; Director (since 1991)
Age 59, Trustee of the Oppenheimer Acquisition Corporation (investment advisory
Trust (since 1994) holding company); Trustee (since 1991), BayState Health
Systems; Director (since 1993), Association of Private Pension
and Welfare Plans; Chairman and Director (since 1995) and
Trustee (1990-1995), SIS Bank (formerly, Springfield
Institution for Savings); Director (1992-1995), Concert Capital
Management, Inc. (an indirect investment advisory subsidiary
of MassMutual); Director (1992-1995), Colebrook Group
(commercial real estate consultants).
John H. Southworth Chairman (since 1993) and President (1984-1992),
Age 68, Trustee of the Southworth Company (manufacturer of paper and calendars);
Trust (since 1994) Director (since 1995), Trustee (until 1995), SIS Bank
(formerly, Springfield Institution for Savings); Trustee, MML
Series Investment Fund (open-end investment company).
Stuart H. Reese Senior Vice President (since 1993), MassMutual; President
Age 41, President of (since 1993), MML Series Investment Fund; President (since
the Trust (since 1994) 1995), Executive Vice President (1993-1995), MassMutual
</TABLE>
- ---------------
* Trustee who is an "interested person" of the Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
-13-
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- -----------------------------------------------------
<S> <C>
Stuart H. Reese (contd.) Corporate Investors and MassMutual Participation Investors;
Director (since 1994), MassMutual Corporate Value Partners
Limited (investor in debt and equity securities) and
MassMutual Corporate Value Limited (parent of MassMutual
Corporate Value Partners Limited); Supervisory Director
(since 1994), MassMutual/Carlson CBO (collateralized bond
fund); Director and Member of Investment Committee (since
1994), MML Bay State Life Insurance Company (wholly-
owned insurance subsidiary of MassMutual); Director and
Member of Investment and Auditing Committees, MML
Pension Insurance Company (wholly-owned insurance
subsidiary of MassMutual Holding Company Two MSC, Inc.);
Director (since 1994), Pace Industries (aluminum die caster);
Vice President and Managing Director (1990-1992), Capital
Markets Group of Aetna Life & Casualty Company; Chairman
and President (1990-1993), Aetna Financial Services, Inc.
Hamline C. Wilson Senior Managing Director (since 1996), Vice President and
Age 58, Vice President Managing Director (1989-1996), MassMutual; Vice President
and Chief Accounting and Chief Financial Officer, MML Series Investment Fund,
and Financial Officer of MassMutual Corporate Investors and MassMutual
the Trust (since 1994) Participation Investors; Investment Officer (since 1992), Vice
President (1983-1992), Concert Capital Management, Inc.
Stephen L. Kuhn Vice President and Associate General Counsel (since 1992),
Age 49, Vice President and Second Vice President and Associate General Counsel (1988-
Secretary of the Trust 1992), MassMutual; Vice President and Secretary, MML
(since 1994) Series Investment Fund, MassMutual Participation Investors
and MassMutual Corporate Investors; President,
MassMutual/Carlson CBO Incorporated; Chief Legal Officer
and Assistant Secretary (since 1995), DLB Acquisition
Corporation (holding company for investment advisers);
Assistant Clerk (since 1994), Chief Legal Officer (since 1993)
and Clerk (1990-1994), Concert Capital Management, Inc.
</TABLE>
-14-
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position Principal Occupation During Past Five Years and Other
with the Trust Principal Business Affiliations
- ---------------------- -----------------------------------------------------
<S> <C>
Raymond B. Woolson Managing Director (since 1996), Second Vice President
Age 37, Treasurer of (1992-1996), Director/Fund Account Administration (1989-
the Trust (since 1994) 1992), MassMutual; Treasurer, MassMutual Corporate
Investors and MassMutual Participation Investors; Treasurer
(since 1996), MML Series Investment Fund; Second Vice
President (since 1994), MassMutual Holding Company.
John J. McMahon Director of Accounting Services, MassMutual; Comptroller
Age 40, Comptroller of (since 1994), MML Series Investment Fund, MassMutual
the Trust (since 1994) Corporate Investors and MassMutual Participation Investors.
</TABLE>
Board and Committee Meetings
- ----------------------------
The Board of Trustees of the Trust have established standing Audit and
Nominating Committees. The Audit Committee, whose members are Messrs. McCarthy
and Southworth, makes recommendations to the Trustees as to the engagement or
discharge of the Trust's independent auditors, supervises investigations into
matters relating to audit functions, reviews with the Trust's independent
auditors the results of the audit engagement, and considers the audit fees. The
Nominating Committee, whose members are Ms. Boland and Messrs. Abdow, Marshall,
McCarthy, and Southworth, considers making all nominations for non-interested
members of the Board of Trustees. The selection and nomination of management
nominees for such vacancies is committed to the discretion of the Nominating
Committee. In 1995, the Audit Committee met once. The Nominating Committee did
not meet in 1995. Each Trustee attended 100% of the aggregate number of all
meetings of the Board of Trustees and the total number of the committee on which
he or she served, other that Messrs. Wendlandt and Naughton, who each attended
75% of such meetings.
Compensation
- ------------
The Trust, on behalf of each Fund, pays each member of its Board of
Trustees who is not an "interested person" of the Trust or MassMutual a $2,000
fee for each calendar quarter and a $2,000 fee for each meeting of the Board of
Trustees attended by such Trustee. Such Trustees who are members of the Audit
Committee, are paid an additional $1,000 per year. Such Trustees who serve on
the Nominating Committee are paid an additional $500 fee for each meeting
attended. In addition, the Trust reimburses out-of-pocket business travel
expenses to such Trustees. Trustees and officers of the Trust who are
"interested persons" of the Trust or MassMutual are not entitled to any fee for
their services to the Trust.
-15-
<PAGE>
The following table discloses the compensation paid to the Trust's non-
interested Trustees for the fiscal year ended December 31, 1995. The Trust has
no pension, retirement, or deferred compensation plans. All of the non-
interested Trustees also serve as Trustees of one other investment company
managed by MassMutual.
<TABLE>
<CAPTION>
Name of Person and Position Aggregate Compensation Total Compensation from
From Trust Trust and Fund Complex
- --------------------------------------------------------------------------------
<S> <C> <C>
Ronald J. Abdow, Trustee
$16,000 $32,000
- --------------------------------------------------------------------------------
Mary E. Boland, Trustee
$16,000 $32,000
- --------------------------------------------------------------------------------
Charles J. McCarthy,
Trustee
$17,000 $34,000
- --------------------------------------------------------------------------------
John H. Southworth, Trustee
$17,000 $74,074
- --------------------------------------------------------------------------------
</TABLE>
PROPOSAL (3)
RATIFICATION OF THE SELECTION OF COOPERS & LYBRAND L.L.P.
AS INDEPENDENT ACCOUNTANTS FOR THE FISCAL
YEAR ENDING DECEMBER 31, 1996
At a meeting on February 9, 1996, a majority of the Board of Trustees of
the Trust, including a majority of those members of the Board who are not
"interested persons" of the Trust, selected the firm of Coopers & Lybrand L.L.P.
("C&L") as independent accountants for the Trust for the fiscal year ending
December 31, 1996. C & L has served the Trust as independent accountant since
the Trust's inception. A representative of C & L will have the opportunity to
make a statement during the Special Meeting via telephone and is expected to be
available via telephone during the Special Meeting to respond to appropriate
shareholder questions.
The Board of Trustees recommends that shareholders ratify the selection of
Coopers & Lybrand L.L.P. as the Trust's independent accountants.
RELATED INFORMATION
Administrator and Underwriter
- -----------------------------
MassMutual, in addition to being the investment manager of the Funds, also
provides administrative and shareholder services to the Trust pursuant to the
terms of its Administrative and Shareholder Services Agreements with the Trust,
on behalf of each of the seven Funds. For its services under the Administrative
and Shareholder Services Agreements, MassMutual earned aggregate fees of
$2,958,614 during the fiscal year ended December 31, 1995.
The Trust's principal underwriter is OppenheimerFunds Distributor, Inc.
("Oppenheimer"), whose address is Two World Trade Center, New York, New York
10048. Oppenheimer
-16-
<PAGE>
provides distribution services to the Trust pursuant to a General Distributor's
Agreement dated August 5, 1994 and a Distribution and Service Plan and Agreement
with Class 1 and Class 2, and Class 3 shares of each Fund. For its services
under the Distribution and Service Plans and Agreements, Oppenheimer earned
aggregate fees of $4,429 during the fiscal year ended December 31, 1995.
Affiliated Broker Transactions
- -------------------------------
In the fiscal year ended December 31, 1995, no brokerage commissions were
paid to affiliated brokers of the Trust or of MassMutual, Concert Capital, or
HarbourView on account of trading for the Funds.
Security Ownership Of Certain Beneficial Owners
- -----------------------------------------------
MassMutual, a Massachusetts corporation whose principal executive offices
are located at 1295 State Street, Springfield, Massachusetts 01111, owns,
through certain of its investment accounts and its provision of seed money for
the Trust, 100% of the Class 2, Class 3 and Class 4 shares of each Fund as of
the Record Date. The table below sets forth information relating to those
persons known to the Trust who beneficially own more than 5% of the Class 1
shares of each of the Funds.
<TABLE>
<CAPTION>
Name of Fund and Number of Class 1
Beneficial Owner Shares Beneficially Owned Percent of Class
- --------------------------- --------------------------------- ----------------
<S> <C> <C>
Massachusetts Mutual Life Prime Fund
Insurance Company 698.107 Shares 100%
1295 State Street
Springfield, MA 01111 Short-Term Bond Fund
10,901.337 Shares 100%
Core Bond Fund
11,093.566 Shares 96.43%
Value Equity Fund
10,258.104 Shares 100%
Balanced Fund
10,441.294 Shares 97.50%
Small Cap Value Equity Fund
10,317.049 Shares 87.01%
International Equity Fund
10,119.402 Shares 79.82%
</TABLE>
-17-
<PAGE>
<TABLE>
<CAPTION>
Name of Fund and Number of
Name and Address of Class 1 Shares
Beneficial Owner Beneficially Owned Percent of Class
- --------------------------- --------------------------------- ----------------
<S> <C> <C>
Creative Presentations, Small Cap Value Equity Fund
Inc. 1,540.792 Shares 12.99%
401(k) Profit Sharing Plan
24907 Anza Drive
Valencia, CA 91355
International Equity Fund
2,559.182 Shares 20.18%
</TABLE>
MassMutual
- ----------
Listed below are the names and principal occupations of the Directors of
MassMutual and of MassMutual's principal executive officer, all of whose
addresses are the same as that of MassMutual.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Position with MassMutual and Principal Occupation
- --------------------------------------------------------------------------------
<S> <C>
Roger G. Ackerman Director of MassMutual; Chaiman and Chief
Executive Officer, Corning Incorporated
(manufacturer of specialty materials,
communication equipment, and consumer products)
- --------------------------------------------------------------------------------
James R. Birle Director of MassMutual; Founding Chairman of
Resolute Partners, Inc.
- --------------------------------------------------------------------------------
Frank C. Carlucci III Director of MassMutual; Chairman and Partner, The
Carlyle Group (merchant banking corporation)
- --------------------------------------------------------------------------------
Gene Chao Director of MassMutual; President, Computer
Projections, Inc.
- --------------------------------------------------------------------------------
Patricia D. Dennis Director of MassMutual; Senior Vice President and
Assistant General Counsel, SBC Communications,
Inc. (telecommunications)
- --------------------------------------------------------------------------------
Anthony Downs Director of MassMutual; Senior Fellow, Brookings
Institution (non-profit policy research center)
- --------------------------------------------------------------------------------
James L. Dunlap Director of MassMutual; Retired (since 1996) Former
Senior Vice President, Texaco, Inc. (producer of
petroleum products) and Former President, Texaco
USA
- --------------------------------------------------------------------------------
William B. Ellis Director of MassMutual; Senior Fellow at Yale
University
- --------------------------------------------------------------------------------
Robert M. Furek Director of MassMutual; President and Chief
Executive Officer, Heublein, Inc. (beverage
distributor)
- --------------------------------------------------------------------------------
Charles K. Gifford Director of MassMutual; Chief Executive Officer of
Bank of Boston Corporation; Chief Executive Officer
of The First National Bank of Boston
- --------------------------------------------------------------------------------
William N. Griggs Director of MassMutual; Managing Director, Griggs
& Santow, Inc. (business consultants)
- --------------------------------------------------------------------------------
</TABLE>
-18-
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Position with MassMutual and Principal Occupation
- --------------------------------------------------------------------------------
<S> <C>
George B. Harvey Director of MassMutual; Chairman, President and
Chief Executive Officer, Pitney Bowes, Inc.
(office machines manufacturer)
- --------------------------------------------------------------------------------
Barbara Barnes Hauptfuhrer Director of MassMutual; Director, The Vanguard
Group of Investment Companies, The Great Atlantic
and Pacific Tea Company, Inc. (operator of retail
food stores), Knight-Ridder, Inc. (publisher of
daily newspapers and operator of cable television
and business information systems), Raytheon
Company (manufacturer of electronic equipment),
Alco Standard Corp. (diversified manufacturer and
distributor)
- --------------------------------------------------------------------------------
Sheldon B. Lubar Director of MassMutual; Chairman, Lubar & Co.,
Incorporated (investment management and advisory
company)
- --------------------------------------------------------------------------------
William B. Marx, Jr. Director of MassMutual; Retired (since 1996); Former
Senior Executive Vice President, Lucent
Technologies, Inc. (public telecommunications
systems and software)
- --------------------------------------------------------------------------------
John F. Maypole Director of MassMutual; Managing Partner of Peach
State Real Estate Holding Company (real estate
investment company)
- --------------------------------------------------------------------------------
Donald F. McCullough Director of MassMutual; Retired (since 1988);
Former Chairman of the Board of Directors, Chief
Executive Officer and President, Collins & Aikman
Corp. (manufacturer of textile products)
- --------------------------------------------------------------------------------
John J. Pajak Director, Vice Chairman and Chief Administrative
Officer of MassMutual
- --------------------------------------------------------------------------------
Barbara S. Preiskel Director of MassMutual; Attorney-at-Law
- --------------------------------------------------------------------------------
David E. Sams, Jr. Director, President and Chief Operating Officer of
MassMutual
- --------------------------------------------------------------------------------
Thomas B. Wheeler Chairman, Chief Executive Officer, and Director of
MassMutual
- --------------------------------------------------------------------------------
Alfred M. Zeien Director of MassMutual; Chairman and Chief
Executive Officer, The Gillette Company
(manufacturer of personal care products)
- --------------------------------------------------------------------------------
</TABLE>
Concert Capital
- ---------------
Listed below are the names and principal occupations of the Directors of Concert
Capital and of Concert Capital's principal executive officer all of whose
addresses are One Memorial Drive, Cambridge, Massachusetts 02142, other than
Messrs. Wendlandt and Wheeler, whose addresses are the same as MassMutual's
address.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Position with Concert Capital and Principal
Occupation
- --------------------------------------------------------------------------------
<S> <C>
Daniel J. Fitzgerald Director of Concert Capital; Executive Vice
President of MassMutual
- --------------------------------------------------------------------------------
Peter C. Schiemann Director of Concert Capital; Executive Vice
President of Babson
- --------------------------------------------------------------------------------
</TABLE>
-19-
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------
Name Position with Concert Capital and Principal
Occupation
- --------------------------------------------------------------------------------
<S> <C>
Peter C. Thompson Director, President and Chief Executive Officer of
Concert Capital; President and Director of Babson
- --------------------------------------------------------------------------------
Gary E. Wendlandt President of Concert Capital; Chief Investment
Officer and Executive Vice President of MassMutual
- --------------------------------------------------------------------------------
</TABLE>
Babson
- ------
Listed below are the names and principal occupations of the Directors of Babson
and of Babson's principal executive officer, all of whose addresses are One
Memorial Drive, Cambridge, Massachusetts 02142
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Position with Babson and Principal Occupation
- --------------------------------------------------------------------------------
<S> <C>
Kathleen M. Elliott Director and Senior Vice President of Babson
- --------------------------------------------------------------------------------
Ronald E. Gwozdz Director and Executive Vice President of Babson
- --------------------------------------------------------------------------------
Hani K. Findakly Director of Babson; President of Potomac Babson
- --------------------------------------------------------------------------------
James W. MacAllen Director and Senior Vice President of Babson;
Senior Vice President of Concert Capital
- --------------------------------------------------------------------------------
Edward L. Martin Director and Executive Vice President of Babson;
Senior Vice President and Director of Potomac
Babson
- --------------------------------------------------------------------------------
John V. Murphy Director, Chief Operating Officer, and Executive
Vice President of Babson; Chief Operating Officer
of Concert Capital; Senior Vice President and
Director of Potomac Babson
- --------------------------------------------------------------------------------
Peter C. Thompson Director and President of Babson; Director of
Potomac Babson; Director, President and Chief
Executive Officer of Concert Capital
- --------------------------------------------------------------------------------
Peter C. Schliemann Director and Executive Vice President of Babson;
Director of Concert Capital
- --------------------------------------------------------------------------------
Jonathan B. Treat Director and Senior Vice President of Babson
- --------------------------------------------------------------------------------
Roland W. Whitridge Director and Senior Vice President of Babson
- --------------------------------------------------------------------------------
</TABLE>
OTHER MATTERS AND DISCRETION OF SHAREHOLDERS
While the meeting has been called to act upon any other business that may
properly come before it, at the date of this Proxy Statement the only business
which the Trustees intend to present or know that others will present is the
business set forth in the Notice of Special Meeting. If other matters lawfully
come before the meeting, and on all procedural matters at said meeting, it is
the intention of those persons named in the enclosed Proxy Instruction Forms to
vote those proxies in accordance with their best judgment.
-20-
<PAGE>
SHAREHOLDER PROPOSALS
The Trust is not required, and does not intend, to hold annual meetings of
shareholders. Shareholders wishing to submit a proposal to be considered for
presentation at the next meeting of shareholders should send their written
proposals to MassMutual Institutional Funds, 1295 State Street, Springfield,
Massachusetts 01111, so that they are received within a reasonable time before
any such meeting.
By Order of the
Board of Directors
Stephen L. Kuhn
Vice President and Secretary
Springfield, Massachusetts
October 4, 1996
-21-
<PAGE>
EXHIBIT A
FORM OF PROPOSED
INVESTMENT SUB-ADVISORY AGREEMENT
Between
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
And
DAVID L. BABSON AND COMPANY INCORPORATED
(With respect to [MassMutual Value Equity Fund][MassMutual Small Cap Equity
Fund] [the Value Equity Sector of the MassMutual Balanced Fund])
A - 1
<PAGE>
INVESTMENT SUB-ADVISORY AGREEMENT
---------------------------------
This INVESTMENT SUB-ADVISORY AGREEMENT (the "Sub-Advisory Agreement"),
is by and between David L. Babson and Company Incorporated, organized under the
laws of the Commonwealth of Massachusetts (the "Sub-Adviser"), and Massachusetts
Mutual Life Insurance Company, a Massachusetts corporation ("MassMutual"),
effective this day of , 1996.
WHEREAS, the [MassMutual Value Equity Fund] [MassMutual Small Cap Value
Equity Fund] [ MassMutual Balanced Fund] (the "Fund") is a series of MassMutual
Institutional Funds (the "Trust"), a Massachusetts business trust which is an
open-end diversified management investment company registered as such with the
Securities and Exchange Commission (the "Commission") pursuant to the Investment
Company Act of 1940, as amended (the "Act"), and the Trust has appointed
MassMutual as the investment adviser for the Fund, [including the Equity Sector
of the Fund,] pursuant to the terms of an Investment Advisory Agreement (the
"Advisory Agreement");
WHEREAS, the Advisory Agreement provides that MassMutual may, at its
option, subject to approval by the Trustees of the Trust and, to the extent
necessary, shareholders of the Fund, appoint a sub-adviser to assume certain
responsibilities and obligations of MassMutual under the Advisory Agreement;
WHEREAS, MassMutual and the Sub-Adviser are investment advisers
registered with the Commission as such under the Investment Advisers Act of
1940, as amended (the "Advisers Act"); and
WHEREAS, MassMutual desires to appoint the Sub-Adviser as its sub-
adviser for the Fund and the Sub-Adviser is willing to act in such capacity upon
the terms herein set forth;
NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, MassMutual and the Sub-Adviser, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. General Provision.
------------------
MassMutual hereby employs the Sub-Adviser and the Sub-Adviser hereby
undertakes to act as the investment sub-adviser of the Fund to provide
investment advice and to perform for the Fund such other duties and
functions as are hereinafter set forth. The Sub-Adviser shall, in all
matters, give to the Fund and the Trust's Board of Trustees, directly or
through MassMutual, the benefit of the Sub-Adviser's best judgment,
effort, advice and
A - 2
<PAGE>
recommendations and shall, at all times conform to, and use its best
efforts to enable the Fund to conform to:
(a) the provisions of the Act and any rules or regulations
thereunder;
(b) any other applicable provisions of state or federal law;
(c) the provisions of the Agreement and Declaration of Trust and
Bylaws of the Trust, as amended from time to time (collectively
referred to as the "Trust Documents");
(d) policies and determinations of the Board of Trustees of the Trust
and MassMutual;
(e) the fundamental and non-fundamental policies and investment
restrictions of the Fund as reflected in the Trust's registration
statement under the Investment Company Act or as such policies
may, from time to time, be amended by the Fund's shareholders;
and
(f) the Prospectus and Statement of Additional Information of the
Fund in effect from time to time.
The appropriate officers and employees of the Sub-Adviser shall be
available upon reasonable notice for consultation with any of the
Trustees and officers of the Trust and MassMutual with respect to any
matter dealing with the business and affairs of the Fund, such as the
valuation of portfolio securities of the Fund, including but not limited
to securities that are either not registered for public sale or
securities not traded on any securities market.
2. Duties of the Sub-Adviser.
--------------------------
(a) The Sub-Adviser shall, subject to the direction and control by the
Trust's Board of Trustees or MassMutual, to the extent MassMutual's
direction is not inconsistent with that of the Board of Trustees,
(i) regularly provide investment advice and recommendations to the
Fund, directly or through MassMutual, with respect to the Fund's
investments, investment policies and the purchase and sale of
securities; (ii) supervise and monitor continuously the investment
program of the Fund and the composition of its portfolio and
determine what securities shall be purchased or sold by the Fund;
(iii) arrange, subject to the provisions of Section 5 hereof, for
the
A - 3
<PAGE>
purchase of securities and other investments for the Fund and the
sale of securities and other investments held in the portfolio of
the Fund; and (iv) provide reports on the foregoing to the Board of
Trustees at each Board meeting.
(b) Provided that none of MassMutual, the Fund or the Trust shall be
required to pay any compensation other than as provided by the
terms of this Sub-Advisory Agreement and subject to the provisions
of Section 5 hereof, the Sub-Adviser may obtain investment
information, research or assistance from any other person, firm or
corporation to supplement, update or otherwise improve its
investment management services.
(c) Provided that nothing herein shall be deemed to protect the Sub-
Adviser from willful misfeasance, bad faith or gross negligence in
the performance of its duties, or reckless disregard to its
obligations and duties under this Sub-Advisory Agreement, the Sub-
Adviser shall not be liable for any loss sustained by reason of
good faith errors or omissions in connection with any matters to
which this Sub-Advisory Agreement relates.
(d) Nothing in this Sub-Advisory Agreement shall prevent MassMutual or
the Sub-Adviser or any officer thereof from acting as investment
adviser or sub-adviser for any other person, firm or corporation
and shall not in any way limit or restrict MassMutual or the Sub-
Adviser or any of their respective directors, officers, members,
stockholders or employees from buying, selling, or trading any
securities for its own account or for the account of others for
whom it or they may be acting, provided that such activities will
not adversely affect or otherwise impair the performance by any
party of its duties and obligations under this Sub-Advisory
Agreement.
(e) The Sub-Adviser shall cooperate with MassMutual by providing
MassMutual with any information in the Sub-Adviser's possession
necessary for supervising the activities of all administrative and
clerical personnel as shall be required to provide corporate
administration for the Fund, including the compilation and
maintenance of such records with respect to its operations as may
reasonably be required. The Sub-Adviser shall, at its own expense,
provide such officers for the Trust as its Board may request.
A - 4
<PAGE>
3. Duties of MassMutual.
---------------------
MassMutual shall provide the Sub-Adviser with the following information
about the Fund:
(a) cash flow estimates on request;
(b) notice of the Fund's "investable funds" by 9:00 a.m. each business
day;
(c) as they are modified, from time to time, current versions of the
documents and policies referred to in Subsections (c), (d), (e) and
(f) of Section 1 hereof, above.
4. Compensation of the Sub-Adviser.
--------------------------------
MassMutual agrees to pay the Sub-Adviser and the Sub-Adviser agrees to
accept as full compensation for the performance of all functions and
duties on its part to be performed pursuant to the provisions hereof, a
fee paid weekly at the annual rate [.13% for the MassMutual Value Equity
Fund, .13% for the Value Equity Sector of the MassMutual Balanced Fund,
and .25% for the MassMutual Small Cap Value Equity Fund] of the average
daily net asset value of the Fund, determined at the close of the New
York Stock Exchange on each day that the Exchange is open for trading
and paid on the last day of each week.
5. Portfolio Transactions and Brokerage.
-------------------------------------
(a) The Sub-Adviser is authorized, in arranging the purchase and sale
of the Fund's publicly-traded portfolio securities, to employ or
deal with such members of securities exchanges, brokers or dealers
(hereinafter "broker- dealers"), including "affiliated" broker-
dealers, as that term is defined in the Act, as may, in its best
judgment, implement the policy of the Fund to obtain, at reasonable
expense, the best execution (prompt and reliable execution at the
most favorable security price obtainable) of the Fund's portfolio
transactions.
(b) The Sub-Adviser may effect the purchase and sale of securities
(which are otherwise publicly traded) in private transactions on
such terms and conditions as are customary in such transactions,
may use a broker in such to effect said transactions, and may enter
into a contract in which the broker acts either as principal or as
agent.
(c) The Sub-Adviser shall select broker-dealers to effect the Fund's
portfolio transactions on the basis of its estimate of their
ability to obtain best execution of
A - 5
<PAGE>
particular and related portfolio transactions. The abilities of a
broker-dealer to obtain best execution of particular portfolio
transaction(s) will be judged by the Sub-Adviser on the basis of all
relevant factors and considerations including, insofar as feasible, the
execution capabilities required by the transaction or transactions; the
ability and willingness of the broker-dealer to facilitate the Fund's
portfolio transactions by participating therein for its own account; the
importance to the Fund of speed, efficiency or confidentiality; the
broker-dealer's apparent familiarity with sources from or to whom
particular securities might be purchased or sold; as well as any other
matters relevant to the selection of a broker-dealer for particular and
related transactions of the Fund.
6. Duration.
---------
Unless terminated earlier pursuant to Section 7 hereof, this Sub-
Advisory Agreement shall remain in effect until [insert date one year
from the date shareholder approval received]. Thereafter it shall
continue in effect from year to year, so long as such continuance shall
be approved at least annually by the Trust's Board of Trustees,
including the vote of the majority of the Trustees of the Trust who are
not parties to this Sub-Advisory Agreement or "interested persons" (as
defined in the Act) of any such party cast in person at a meeting called
for the purpose of voting on such approval, or by the holders of a
"majority" (as defined in the Act) of the outstanding voting securities
of the Fund.
7. Termination.
------------
This Sub-Advisory Agreement shall terminate automatically upon its
assignment or in the event upon the termination of the Advisory
Agreement; it may also be terminated: (i) for cause or with the consent
of the parties and the Trust by MassMutual or the Sub-Adviser at any
time without penalty upon sixty days' written notice to the other party
and the Trust; or (ii) by the Trust at any time without penalty upon
sixty days' written notice to MassMutual and the Sub-Adviser provided
that such termination by the Trust shall be directed or approved by a
vote of a majority of all of the Trustees of the Trust then in office or
by the vote of the holders of a "majority" of the outstanding voting
securities of the Fund (as defined in the Act).
8. Disclaimer of Shareholder Liability.
------------------------------------
MassMutual and the Sub-Adviser understand that the obligations of the
Trust under this Sub-Advisory Agreement are not binding upon any Trustee
or shareholder of the Trust personally, but bind only the Trust and the
Trust's property. MassMutual and the Sub-Adviser represent that each has
notice of the provisions of the Trust Documents disclaiming shareholder
and Trustee liability for acts or obligations of the Trust.
A - 6
<PAGE>
9. Notice.
-------
Any notice under this Sub-Advisory Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other party,
with a copy to the Trust, at the addresses below or such other address
as such other party may designate for the receipt of such notice.
If to MassMutual:
Massachusetts Mutual Life Insurance Company
1295 State Street
Springfield, MA 01111
Attention:
If to the Sub-Adviser:
David L. Babson and Company Incorporated
One Memorial Drive
Cambridge, MA 02142
Attention:
If to either party, copies to:
MassMutual Institutional Funds
1295 State Street
Springfield, MA 01111
Attention:
Investors Bank & Trust
89 South Street
Boston, MA 02205-1537
Attention:
A - 7
<PAGE>
IN WITNESS WHEREOF, MassMutual and the Sub-Adviser have caused this Sub-
Advisory Agreement to be executed on the day and year first above written.
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
By:
------------------------------------------
DAVID L. BABSON AND COMPANY INCORPORATED
By:
------------------------------------------
Accepted and Acknowledged:
--------------------------
MASSMUTUAL INSTITUTIONAL FUNDS on behalf of
[MASSMUTUAL VALUE EQUITY FUND]
[MASSMUTUAL SMALL CAP VALUE EQUITY FUND]
[the Value Equity Sector of the MASSMUTUAL BALANCED FUND]
By:
---------------------------------
A - 8
<PAGE>
APPENDIX
MASSMUTUAL INSTITUTIONAL FUNDS
[MassMutual Value Equity Fund]
[MassMutual Small Cap Value Equity Fund]
[MassMutual Balanced Fund]
1295 State Street
Springfield, Massachusetts 01111
PROXY INSTRUCTION FORM
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF MASSMUTUAL
INSTITUTIONAL FUNDS, WHICH RECOMMENDS THAT YOU VOTE "FOR" ITEMS 1, 2 AND 3.
The undersigned hereby appoints Thomas J. Finnegan, Jr., Stephen L. Kuhn and
Hamline C. Wilson, and any of them, proxies of the undersigned, with power of
substitution, to cast all shares of [MassMutual Value Equity Fund] [MassMutual
Small Cap Value Equity Fund] [MassMutual Balanced Fund] series of MassMutual
Institutional Funds (the "Trust") which the undersigned is entitled to vote at
the Special Meeting of Shareholders of the Trust to be held on October 16, 1996
and at any and all adjournments thereof. The undersigned hereby acknowledges
receipt of the Notice of Special Meeting of Stockholders and the related Proxy
Statement.
In their discretion, the proxies are authorized to vote upon such other matters
as may properly come before the meeting.
This Proxy Instruction Form when properly executed will be voted in the manner
directed herein by the undersigned shareholder. If no specification is made,
this Proxy Instruction Form will be voted "FOR" all nominees as trustees and
"FOR" Proposal 1 and 3.
(PLEASE VOTE, DATE AND SIGN ON THE REVERSE SIDE)
<PAGE>
The proxies are instructed to vote as follows:
(Please mark your choice by placing an "x" in the appropriate box, using blue or
black ink.)
1. Approval of the Investment Sub-Advisory Agreement to be entered into
between Massachusetts Mutual Life Insurance Company and David L. Babson and
Company Incorporated, as described in the Proxy Statement.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
2. Election of Richard H. Ayers, David E. A. Carson, Richard G. Dooley,
Richard W. Greene, Beverly C. L. Hamilton and F. William Marshall, Jr. as
members Board of Trustees, each for an indefinite term.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
ALL NOMINEES ALL NOMINEES
EXCEPT AS LISTED
BELOW
INSTRUCTIONS: To withhold your vote for any nominee(s), write that
nominees name on the line below.
_______________________________________________________________________________
3. Ratification of the selection of Coopers & Lybrand L.L.P. as independent
auditors and accountants for the Trust for the fiscal year ending December
31, 1996.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: _____________, 1996
Signature(s):
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR ON THIS PROXY INSTRUCTION
FORM. When shares are held by joint tenants, both should sign. When signing
as attorney, executor, administrator, trustee or guardian, please give full
title as such. If a corporation, please sign in full corporate name by its
president or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY INSTRUCTION FORM PROMPTLY USING
THE ENCLOSED ENVELOPE
<PAGE>
APPENDIX
MASSMUTUAL INSTITUTIONAL FUNDS
[MassMutual Prime Fund]
[MassMutual Short-Term Bond Fund]
[MassMutual Core Bond Fund]
[MassMutual International Equity Fund]
1295 State Street
Springfield, Massachusetts 01111
PROXY INSTRUCTION FORM
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF MASSMUTUAL
INSTITUTIONAL FUNDS, WHICH RECOMMENDS THAT YOU VOTE "FOR" ITEMS 2 AND 3
The undersigned hereby appoints Thomas J. Finnegan, Jr., Stephen L. Kuhn and
Hamline C. Wilson, and any of them, proxies of the undersigned, with power of
substitution, to cast all shares of [MassMutual Prime Fund] [MassMutual Short-
Term Bond Fund] [MassMutual Core Bond Fund] [MassMutual International Equity
Fund] series of MassMutual Institutional Funds (the "Trust") which the
undersigned is entitled to vote at the Special Meeting of Shareholders of the
Trust to be held on October 16, 1996 and at any and all adjournments thereof.
The undersigned hereby acknowledges receipt of the Notice of Special Meeting of
Stockholders and the related Proxy Statement.
In their discretion, the proxies are authorized to vote upon such other matters
as may properly come before the meeting.
This Proxy Instruction Form when properly executed will be voted in the manner
directed herein by the undersigned shareholder. If no specification is made,
this Proxy Instruction Form will be voted "FOR" all nominees as trustees and
"FOR" Proposal 3.
(PLEASE VOTE, DATE AND SIGN ON THE REVERSE SIDE)
<PAGE>
The proxies are instructed to vote as follows:
(Please mark your choice by placing an "x" the appropriate box, using blue or
black ink.)
2. Election of Richard H. Ayers, David E. A. Carson, Richard G. Dooley,
Richard W. Greene, Beverly C. L. Hamilton and F. William Marshall, Jr. as
members of the Board of Trustees, each for an indefinite term.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
ALL NOMINEES ALL NOMINEES
EXCEPT AS LISTED
BELOW
INSTRUCTIONS: To withhold your vote for any nominee(s), write that
nominees name on the line below.
___________________________________________________________________________
3. Ratification of the selection of Coopers & Lybrand L.L.P. as independent
auditors and accountants for the Trust for the fiscal year ending December
31, 1996.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: _______________ , 1996
Signature(s):
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR ON THIS PROXY INSTRUCTION
FORM. When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title
as such. If a corporation, please sign in full corporate name by its president
or other authorized officer. If a partnership, please sign in partnership name
by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY INSTRUCTION FORM PROMPTLY USING
THE ENCLOSED ENVELOPE
