SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14 (a) of the Securities
Exchange Act of 1934 (Amendment No.__)
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 Rule 14a-11(c) or Rule 14a-12
TOUCHSTONE VARIABLE SERIES TRUST
(Name of Registrant as Specified in Its Charter/Declaration of Trust)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/x/ No fee required.
/ / 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:
/ / 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>
TOUCHSTONE VARIABLE SERIES TRUST
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
Notice is hereby given that a Special Meeting of shareholders of the
Touchstone Variable Series Trust (the "Trust"), composed of the Small Cap Value
Fund, the Emerging Growth Fund, the International Equity Fund, the Income
Opportunity Fund, the High Yield Fund, the Value Plus Fund, the Growth & Income
Fund, the Enhanced 30 Fund, the Balanced Fund, the Bond Fund and the Standby
Income Fund (each, a "Fund" and collectively, the "Funds"), will be held on
December 13, 2000 at 10:00 a.m., Eastern Time, at the offices of the Trust, 221
East Fourth Street, Suite 300, Cincinnati, Ohio 45202.
At the Special Meeting, shareholders of the Trust will be asked to consider
and vote upon the following:
1. To elect Trustees of the Trust (Proposal 1).
2. To ratify the selection of Ernst & Young LLP as the
independent accountants of the Trust (Proposal 2).
3. To transact any other business that may properly come before
the meeting; or any adjournment thereof.
Shareholders of record at the close of business on October 30, 2000 are
entitled to notice of, and to vote at, the Special Meeting. The accompanying
Proxy Statement contains more information about the proposals to be placed
before the Special Meeting.
YOUR VOTE IS IMPORTANT, NO MATTER HOW MANY SHARES YOU OWN. TO AVOID THE
COST OF FOLLOW UP SOLICITATION AND A POSSIBLE ADJOURNMENT, PLEASE READ THE
ENCLOSED PROXY STATEMENT AND COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY CARD
AS PROMPTLY AS POSSIBLE. IT IS IMPORTANT THAT YOUR VOTE BE RECEIVED BY DECEMBER
11, 2000.
This proxy statement is first being mailed to shareholders on or about
November 17, 2000.
By Order of the Board of Trustees of the Touchstone Variable Series Trust
Tina D. Hosking
Secretary
Cincinnati, Ohio
November 17, 2000
<PAGE>
TOUCHSTONE VARIABLE SERIES TRUST
221 East Fourth Street, Suite 300
Cincinnati, Ohio 45202
800-669-2796
PROXY STATEMENT
DECEMBER 13, 2000
This Proxy Statement is furnished to shareholders of the Trust on behalf of
the Trust's Board of Trustees (the "Board") in connection with the Trust's
solicitation of the accompanying proxy. This proxy will be voted at a Special
Meeting of shareholders to be held on December 13, 2000 at 10:00 a.m., Eastern
Time, and at any adjournment thereof, at the offices of the Trust, 221 East
Fourth Street, Suite 300, Cincinnati, Ohio 45202, for the purposes set forth
below and in the accompanying Notice of Special Meeting. This Proxy Statement is
being mailed to Trust shareholders on or about November 17, 2000.
The purpose of the Special Meeting is set forth in the accompanying Notice.
REPORTS TO SHAREHOLDERS
Copies of the Trust's Annual Report for the fiscal year ended December 31,
1999 and the Semi-Annual Report for the period ended June 30, 2000, have
previously been mailed to shareholders. These reports may be obtained without
charge by calling (800) 669-2796 (press 3) or by writing to the Trust, 221 East
Fourth Street, Suite 300, Cincinnati, Ohio 45202.
PROPOSAL 1: ELECTION OF TRUSTEES
The first proposal to be considered at the Special Meeting is the election
of Trustees of the Trust (the "Trustees"). The Board is comprised of the
following Trustees: Messrs. Coleman, Cox, Schwab and Stautberg. At the Special
Meeting of Shareholders, the Board seeks to elect Ms. McGruder and Messrs.
Barrett, Brewster, Coleman, Cox, Lerner, Leshner, Robertson, Schwab and
Stautberg to serve on the Board of the Trust until their successors are elected
and qualified. None of the Trustees are related to one another. Mr. Stern, who
served as a Trustee since July 1994, resigned from the Board in November 2000.
Mr. Williams, who served as a Trustee since July 1994, resigned from the Board
in September 2000.
It is the intention of the persons named in the proxy to vote the shares
represented by each properly executed proxy for the election as Trustee of all
of the persons named below as nominees, unless contrary instructions are given
on the proxy. The Board believes that all of the nominees will stand for
election and will serve if elected. However, if any of the persons nominated by
the Board fails to stand for election or becomes unable to accept election, the
proxies will be voted for the election of such other person or persons as a
majority of the Board may recommend.
The following tables provide information concerning each of the nominees.
<TABLE>
<CAPTION>
NOMINEES FOR TRUSTEE
NAME AND OFFICE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS,
WITH THE TRUST OTHER DIRECTORSHIPS AND AGE TRUSTEE SINCE
-------------- --------------------------- -------------
<S> <C> <C>
John F. Barrett* President and Chief Executive Officer of The Western and Nominee
Southern Life Insurance Company and Western-Southern Life
Assurance Company, Director and Vice Chairman of Columbus
Life Insurance Company, Director of Eagle Realty Group, Inc.
and Director of Fort Washington Investment Advisors, Inc.
Director of the following public companies: The Andersons,
Inc., Convergys Corp., and Fifth Third Bancorp. Age 51.
2
<PAGE>
J. Leland Brewster II Retired Partner of Frost & Jacobs LLP (now known as Frost Nominee
Brown Todd LLC)(a law firm). Age 67.
William O. Coleman Retired General Sales Manager and Vice President of The June 1999
Trustee, Chairman of the Board Procter & Gamble Company and a trustee of The Procter &
of Trustees Gamble Profit Sharing Plan and The Procter & Gamble Employee
Stock Ownership Plan. He is a Director of LCA-Vision (a
laser vision correction institute). He is also a Trustee of
Touchstone Strategic Trust, Touchstone Investment Trust and
Touchstone Tax-Free Trust. Age 71.
Phillip R. Cox President and Chief Executive Officer of Cox Financial Corp. July 1994
Trustee (a financial services company). He is a Director of the
Federal Reserve Bank of Cleveland, Broadwing, Inc. and
Cinergy Corporation. He was formerly a Director of BDM
International (an information technology company) from 1996
to 1998 and PNC Bank from 1996 to 2000. He is also a
Trustee of Touchstone Strategic Trust, Touchstone Investment
Trust and Touchstone Tax-Free Trust. Age 52.
H. Jerome Lerner Principal of HJL Enterprises and is Chairman of Crane Nominee
Electronics, Inc. (a manufacturer of electronic
connectors). He is also a Director of Slush Puppy Inc. (a
manufacturer of frozen beverages) and Peerless Manufacturing
(a manufacturer of bakery equipment). He is also a Trustee
of Touchstone Strategic Trust, Touchstone Investment Trust
and Touchstone Tax-Free Trust. Age 62.
Robert H. Leshner* Managing Director of Fort Washington Investment Advisors, Nominee
Inc. (sub-advisor of the Trust). Until 1999, he was
President and a Director of Fort Washington Brokerage
Services, Inc. (registered broker-dealer; formerly known as
Countrywide Investments, Inc.), Integrated Fund Services,
Inc. (registered transfer agent, formerly known as
Countrywide Fund Services, Inc.) and IFS Fund Distributors,
Inc. (registered broker-dealer; formerly known as CW Fund
Distributors, Inc.). He is also a Trustee of Touchstone
Strategic Trust, Touchstone Investment Trust and Touchstone
Tax-Free Trust. Age 61.
3
<PAGE>
Jill T. McGruder* President, Chief Executive Officer and a director of IFS Nominee
Financial Services, Inc. (a holding company), Touchstone
Advisors, Inc. (the investment advisor of the Trust) and
Touchstone Securities, Inc. (the principal underwriter of
the Trust). She is a Senior Vice President of The Western
and Southern Life Insurance Company and a Director of
Capital Analysts Incorporated (a registered investment
advisor and broker-dealer). She is also President and a
Director of IFS Agency Services, Inc. (insurance agency),
IFS Insurance Agency, Inc., Fort Washington Brokerage
Services, Inc., IFS Fund Distributors, Inc. and Integrated
Fund Services, Inc. She is President of Touchstone Variable
Series Trust. She was a Trustee of Touchstone Variable
Series Trust from February 1999 to June 1999. From March
1996 until December 1996, she was National Marketing
Director of Metropolitan Life Insurance Co. From 1991 until
1996, she was Vice President of IFS Financial Services,
Inc. Age 45.
Oscar P. Robertson President of Orchem, Inc., a chemical specialties Nominee
distributor, and Orpack Stone Corporation, a corrugated box
manufacturer. He is also a Trustee of Touchstone Strategic
Trust, Touchstone Investment Trust and Touchstone Tax-Free
Trust. Age 61.**
Nelson Schwab, Jr. Senior Counsel of Graydon, Head & Ritchey (a law firm). He June 1999
Trustee is a Director of Rotex, Inc., The Ralph J. Stolle Company
and Security Rug Cleaning Company. He is also a Trustee of
Touchstone Strategic Trust, Touchstone Investment Trust and
Touchstone Tax-Free Trust. Age 82.
Robert E. Stautberg Retired Partner of KPMG LLP. He is a Development Director of July 1994
Trustee St. Xavier High School. He is a member of the Board of
Trustees of Good Samaritan Hospital, Bethesda Hospital, and
TriHealth. He is also a Trustee of Touchstone Strategic
Trust, Touchstone Investment Trust and Touchstone Tax-Free
Trust. Age 66.
</TABLE>
*Indicates each Nominee who is an "interested person" of the Trust, as defined
by the Investment Company Act of 1940, by virtue of his or her affiliation with
the Trust's investment adviser or underwriter.
**On February 2, 1996, an involuntary petition under Chapter 7 of the U.S.
Bankruptcy Code was filed by creditors against Orchem, Inc., of which Mr.
Robertson was the chief executive officer. The case was subsequently converted
to a Chapter 11 bankruptcy and is still pending in the U.S. Bankruptcy Court.
OFFICERS OF THE TRUST
The following sets forth information concerning each executive officer of
the Trust.
<TABLE>
<CAPTION>
NAME AND
PRINCIPAL OCCUPATION FOR THE PAST FIVE YEARS OFFICE AGE OFFICER SINCE
-------------------------------------------- ------ --- -------------
<S> <C> <C> <C>
Jill T. McGruder President 45 February 1999
See information under "NOMINEES FOR TRUSTEE."
4
<PAGE>
Maryellen Peretzky Vice President 48 June 2000
Senior Vice President and Secretary of Fort Washington Brokerage Services,
Inc., Integrated Fund Services, Inc. and IFS Fund Distributors, Inc. She is
Assistant Secretary of Fort Washington Investment Advisors, Inc. and is also
Vice President of Touchstone Investment Trust, Touchstone Strategic Trust and
Touchstone Tax-Free Trust.
Terrie A. Wiedenheft Controller 38 June 2000
Senior Vice President, Chief Financial Officer and Treasurer of Integrated Fund
Services, Inc., IFS Fund Distributors, Inc. and Fort Washington Brokerage
Services, Inc. She is Chief Financial Officer of IFS Financial Services, Inc.,
Touchstone Advisors, Inc. and Touchstone Securities, Inc. and Assistant
Treasurer of Fort Washington Investment Advisors, Inc. She is also Controller
of Touchstone Strategic Trust, Touchstone Investment Trust and Touchstone
Tax-Free Trust.
James J. Vance Treasurer 39 September 1997
Vice President and Treasurer of The Western and Southern Life Insurance
Company. He is also Vice President and Treasurer of Western-Southern Life
Assurance Company
Tina D. Hosking Secretary 32 June 2000
Vice President and Associate General Counsel of Integrated Fund Services, Inc.
and IFS Fund Distributors, Inc. She is also Secretary of Touchstone Investment
Trust, Touchstone Strategic Trust and Touchstone Tax-Free Trust.
</TABLE>
COMMITTEES AND BOARD MEETINGS
The Board has appointed a standing Audit Committee, which during the fiscal
year ended December 31, 1999 conducted four meetings. The current members of
the Audit Committee are Messrs. Schwab and Stautberg. The duties of the Audit
Committee include reviewing the financial statements of the Trust and the scope
of the independent annual audit and internal audits. It also reviews the
independent accountant's letter to management concerning the effectiveness of
the Trust's internal financial and accounting controls, and reviews and
recommends to the Board the firm to be engaged as the Trust's independent
accountants. The Audit Committee may also examine and consider such other
matters relating to the financial affairs and operations of the Trust as it
determines to be appropriate. The Audit Committee reports its activities to the
full Board. The Audit Committee is currently composed of Trustees of the Board
who are not interested persons of the Trust (the "Independent Trustees").
The Board has appointed a standing Nominating Committee, which during the
fiscal year ended December 31, 1999, conducted one meeting. The current members
of the Nominating Committee are Messrs. Coleman, Cox, Schwab and Stautberg. The
duties of the Nominating Committee include selecting and recommending to the
entire Board nominees for election as Independent Trustees. The Nominating
Committee reports its activities to the full Board. The Nominating Committee is
currently comprised of Independent Trustees.
The Trust does not have a standing compensation committee. All compensation
matters are determined by the Board.
During the fiscal year ended December 31, 1999, the Board held five
meetings. During fiscal 1999, none of the Trustees attended less than 75% of the
total number of the meetings of the Board and committees of which they were
members.
COMPENSATION OF TRUSTEES
The Trust pays each Trustee who is not a director, officer or employee of
the Advisor, the Fund Sub-Advisors, the Administrator or any of their affiliates
an annual fee of $5,000 plus $1,000 per meeting attended and reimburses them for
travel and out-of-pocket expenses. The following table reflects Trustee fees
paid for the fiscal year ended December 31, 1999.
TRUSTEES' COMPENSATION TABLE FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
5
<PAGE>
<TABLE>
<CAPTION>
Trustees' Total Trustees' Compensation
Compensation from the Trust and
from the Trust the Fund Complex*
-------------- -----------------
<S> <C> <C>
William O. Coleman $3,768 $5, 442
Phillip R. Cox $7,590 $11,000
Nelson Schwab, Jr. $3,768 $5,442
Robert E. Stautberg $7,590 $11,000
Joseph S. Stern, Jr. $6,216 $9,000
</TABLE>
*The Touchstone complex of funds consists of six series of the Touchstone
Tax-Free Trust, eight series of Touchstone Strategic Trust, six series of
Touchstone Investment Trust and eleven series of Touchstone Variable Series
Trust. Messrs. Lerner and Robertson received no compensation from the Trust for
the period ended December 31, 1999 because they were not members of the Board
during the fiscal year. However Mr. Lerner received Trustee Compensation from
the Fund Complex in the amount of $13,500, and Mr. Robertson received Trustee
Compensation from the Fund Complex in the amount of $15,000.
6
<PAGE>
SHARE OWNERSHIP INFORMATION
GENERAL INFORMATION. As of October 30, 2000, there were 23,750,496 outstanding
shares of the Trust. As of October 30, 2000, there were 1,100,862 outstanding
shares of the Small Cap Value Fund; 1,703,981 outstanding shares of the Emerging
Growth Fund; 2,305,728 outstanding shares of the International Equity Fund;
2,534,779 outstanding shares of the Income Opportunity Fund; 1,839,919
outstanding shares of the High Yield Fund; 570,727 outstanding shares of the
Value Plus Fund; 4,824,915 outstanding shares of the Growth & Income Fund;
1,240,125 outstanding shares of the Enhanced 30 Fund; 2,199,508 outstanding
shares of the Balanced Fund; 3,048,072 outstanding shares of the Bond Fund; and
2,381,879 outstanding shares of the Standby Income Fund.
5% RECORD OWNERSHIP INFORMATION. As of October 30, 2000, the following parties
were known by the Trust to be record owners of 5% or more of the outstanding
shares of the Trust: (i) Separate Account 1 of Western-Southern Life Assurance
Company, 400 Broadway, Cincinnati, Ohio 45202, an Ohio corporation ("WSLAC"),
was the record owner of 14,392,215 shares or 60.60% of the outstanding shares of
the Trust; (ii) WSLIC Company II, 500 Scranton Christiana Road, Newark, Delaware
19713, a Delaware corporation, was the record owner of 3,605,569 shares or
15.18% of the outstanding shares of the Trust; (iii) Separate Account A of The
Western and Southern Life Insurance Company, 400 Broadway, Cincinnati, Ohio
45202, an Ohio corporation ("WSLIC"), was record owner of 3,330,153 shares or
14.02% of the outstanding shares of the Trust; and (iv) WSLAC was the record
owner of 22,572,215 shares or 9.50% of the outstanding shares of the Trust.
WSLAC is a wholly owned subsidiary of WSLIC.
5% CONTRACT OWNERSHIP INFORMATION. As of October 30, 2000, no Contract Owners
were known by the Trust to be able to give voting instructions with respect to
5% or more of the outstanding shares of the Trust.
SHARE OWNERSHIP OF OFFICERS AND TRUSTEES. As of October 30, 2000, no Officers or
Trustees were known by the Trust to be able to give voting instructions with
respect to 1% or more of the outstanding shares of the Trust.
BOARD RECOMMENDATION AND REQUIRED VOTE
Election of the listed Nominees for Trustee requires the affirmative vote
of the holders of a plurality of the beneficial interest of the Trust present or
represented by proxy at the Special Shareholder Meeting. The Board of Trustees,
including all of the Independent Trustees, recommends that shareholders of the
Trust vote FOR the election of each Nominee of the Trust.
PROPOSAL 2: RATIFICATION OF
SELECTION OF INDEPENDENT ACCOUNTANTS
Shareholders of the Trust are being asked to ratify the selection of Ernst
& Young LLP ("E&Y") as independent accountants of the Trust for the fiscal year
ending December 31, 2000. The appointment of accountants is approved annually by
the Independent Trustees. The Trust has been advised by E & Y that, as of the
record date, neither that firm nor any of its partners had any direct or
material indirect financial interest in the Trust. Representatives of E & Y are
not expected to be present at the meeting or make a statement, but will be
available via telephone to respond to appropriate questions. Services provided
by E & Y during the fiscal year ending December 31, 2000 to the Trust included
examination of financial statements, review of filings with the Securities and
Exchange Commission and tax returns. No other services were provided by E & Y to
the Trust.
PricewaterhouseCoopers LLP ("PWC") was asked to resign as the independent
accountants for the Trust by the Board of Trustees in June 1999. This decision
did not result from any dispute between the Trust and PWC. Neither of PWC's
reports on the financial statements for the past two fiscal years contained an
adverse opinion or a disclaimer of opinion, nor was either report qualified as
to uncertainty, audit scope or accounting principles. There were no
disagreements between PWC and the Trust on any matter of accounting principles
and practices, financial statement disclosure, or auditing scope or procedure.
The decision to ask PWC to resign and appoint E & Y as the independent
accountants for the Trust for the fiscal year ended December 31, 1999 was
recommended by the Audit Committee and approved by the full Board at a board
meeting held on June 17, 1999. The Audit Committee recommended that the full
Board appoint E & Y as independent accountants of the Trust for the 2000 fiscal
year and reaffirmed E & Y as the independent accountants for the Trust for the
1999 fiscal year at a board meeting held on December 16, 1999.
7
<PAGE>
BOARD RECOMMENDATION AND REQUIRED VOTE
Ratification of the selection of Ernst & Young LLP as independent
accountants of the Trust requires the affirmative vote of the holders of a
majority of the beneficial interest of the Trust present or represented by proxy
at the Special Meeting of Shareholders. The Board of Trustees, including all of
the Independent Trustees, recommends that shareholders of the Trust vote FOR the
ratification of the selection of the independent accountants.
ADDITIONAL INFORMATION
INVESTMENT ADVISOR AND OTHER SERVICE PROVIDERS
Touchstone Advisors, Inc., located at 221 East Fourth Street, Suite 300,
Cincinnati, Ohio 45202, serves as the investment advisor to the Trust and,
accordingly, as investment advisor to each of the Funds.
Touchstone Securities, Inc. serves as the principal underwriter of the
shares of the Trust. The address of Touchstone Securities is 221 East Fourth
Street, Suite 300, Cincinnati, Ohio 45202.
Both the Advisor and the Underwriter are wholly-owned subsidiaries of IFS
Financial Services, Inc., which is a wholly-owned subsidiary of Western-Southern
Life Assurance Company. The address of Western-Southern Life Assurance Company
is 400 Broadway, Cincinnati, Ohio 45202. Western-Southern Life Assurance Company
("WSLAC") is a stock life insurance company organized under the laws of the
State of Ohio on December 1, 1980. WSLAC is a wholly-owned subsidiary of The
Western and Southern Life Insurance Company, a stock life insurance company
originally organized under the laws of the State of Ohio on February 23, 1888
("WSLIC"). WSLIC is wholly owned by an Ohio-domiciled intermediate holding
company, Western-Southern Financial Group, Inc., which is wholly owned by an
Ohio-domiciled mutual insurance holding company, Western-Southern Mutual Holding
Company. WSLAC is in the business of issuing insurance and annuity contracts.
Investors Bank & Trust Company ("Investors Bank") serves as the
administrator, custodian and fund accounting agent for the Trust. The address of
Investors Bank is 200 Clarendon Street, Boston, MA 02116.
OTHER MATTERS TO COME BEFORE THE MEETING
The Trust's management does not know of any matters to be presented at the
meeting other than those described in this Proxy Statement. If other business
should come before the meeting, the proxyholders will vote thereon in accordance
with their best judgment.
PROXY SOLICITATION
The principal solicitation of proxies will be by mail, but proxies may be
solicited by telephone, facsimile and personal contact by directors, officers
and regular employees of Touchstone Advisors, Inc. All costs associated with the
preparation, filing and distribution of this Proxy Statement, the solicitation
and the meeting will be borne by Touchstone Advisors, Inc. Management
Information Services Corp. has been engaged to assist in the distribution and
tabulation of proxies. As the Special Meeting date approaches, a representative
of Touchstone Advisors, Inc., or its affiliates, may contact shareholders whose
votes have not yet been received. The anticipated cost of the proxy solicitation
is approximately $20,000.
VOTING
Only shareholders of record on October 30, 2000 (the "record date") are
entitled to be present and to vote at the Special Meeting or any adjourned
meeting. Page 6 sets forth the number of shares of each Fund of the Trust
outstanding as of the record date.
Other than shares purchased in connection with providing seed capital, the
shares of the Trust may be only be purchased by Western-Southern Life Assurance
Separate Account 1, Western-Southern Life Assurance Separate Account 2 and
Columbus Life Insurance Company Separate Account 1 (the "Separate Accounts") for
the purpose of funding variable annuity and variable life insurance contracts.
8
<PAGE>
Contract owners or participants (collectively, the "Contract Owners") who
select a Fund for investment through a Contract do not invest directly in or
hold shares of the Funds. Western-Southern Life Assurance Company ("WSLAC") and
Columbus Life Insurance Company ("Columbus"), on behalf of the separate
accounts, are the true shareholders of the Funds and, as the legal owner of each
Funds' shares, have sole voting and investment power with respect to the shares,
but generally will pass through any voting rights to Contract Owners. Contract
Owners, therefore, have the right to instruct WSLAC and Columbus how to vote
their interest with respect to the Proposals. WSLAC or Columbus will vote the
shares of each Fund held in the name of its separate accounts as directed by its
Contract Owners.
The holders of certain group Contracts have the right to direct the vote
for all shares under the respective Contract, for, against or abstaining, in the
same proportions as shares for which instructions have been given by
participants covered by the Contract.
The number of shares for which a Contract Owner or participant may provide
voting instructions is calculated by determining for each sub-account the
percentage representing a Contract Owner or participant's investment in a
sub-account, and applying this percentage to the total number of Fund shares
that the sub-account owns.
In the event that any Contract Owner investing in the Trust through the
separate accounts fails to provide WSLAC or Columbus with voting instructions,
WSLAC or Columbus will vote the shares attributable to such Contract Owner for,
against or abstaining, in the same proportions as the shares for which
instructions have been received for other Contract Owners investing through its
separate accounts. Shares of a Fund owned by WSLAC or Columbus will also be
voted in the same proportions as the shares for which instructions have been
received from other Contract Owners investing through its separate accounts.
Any Contract Owner or participant authorizing WSLAC or Columbus to vote
shares attributable to that Contract Owner or participant has the power to
revoke their authorization by written notice (addressed to the principal
executive office of the Trust shown at the beginning of this Proxy Statement),
by executing a superseding authorization card or by submitting a notice of
revocation to the Trust.
The presence in person or by proxy of a Fund's shareholders entitled to
cast a majority in number of votes is necessary to constitute a quorum for the
transaction of business. Because WSLAC and Columbus are the legal owners of a
majority of shares, there will be a quorum at the Special Meeting regardless of
how Contract Owners direct WSLAC and Columbus to vote on the Proposals. If there
are insufficient votes to approve a Proposal, the persons named as proxies may
propose one or more adjournments of the Special Meeting to permit additional
time for the solicitation of proxies, in accordance with applicable law.
Adjourned meetings must be held within a reasonable time after the date
originally set for the meeting (but not more than 120 days after the record
date). Solicitation of votes may continue to be made without any obligation to
provide any additional notice of the adjournment. The persons named as proxies
will vote in favor of such adjournment those proxies which they are entitled to
vote in favor of the Proposal and will vote against any such adjournment those
proxies to be voted against the Proposal.
SHAREHOLDER PROPOSALS
The meeting is a Special Meeting of shareholders. The Trust is not required
to, nor does it intend to, hold regular annual meetings of Trust Shareholders.
If a regular annual meeting is called, any shareholder who wishes to submit a
proposal for consideration at the meeting should submit the proposal promptly to
the Trust. Timely submission of a proposal does not guarantee its inclusion.
PLEASE COMPLETE THE ENCLOSED PROXY CARD(S) OR AUTHORIZATION CARD(S), AS
APPLICABLE, AND RETURN THE CARD(S) BY DECEMBER 11, 2000 IN THE ENCLOSED
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE.
November 17, 2000 By order of the Board of Trustees of the Trust
Cincinnati, Ohio Tina D. Hosking, Secretary
9
