SCHEDULE 14A INFORMATION
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule14a-11(c) or Rule 14a-12
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
(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):
[ ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth amount on which the filing
fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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4) Date Filed:
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MUTUAL OF AMERICA
INSTITUTIONAL FUNDS, INC.
Special Meeting of Shareholders
to be held on August 24, 2000
PROXY STATEMENT
Your Vote is Important
o Please review the Proxy Statement, which describes matters to be voted on,
o Mark your vote on the Proxy Card(s) that accompany the Proxy Statement,
and
o Return the Proxy Card(s) in the enclosed envelope or fax the Card(s) to
212-224-2540.
<PAGE>
Questions and Answers
for the
Special Meeting of Shareholders
Please read the Proxy Statement for complete information about the Special
Meeting and the proposals to be voted on by shareholders. The Questions and
Answers below provide an overview of the Meeting and the proposals.
Q: What is the Notice of Special Meeting?
A: Mutual of America Institutional Funds, Inc. (the "Investment Company") has
called a special meeting of shareholders to be held on August 24, 2000
(the "Meeting"). The Notice of Special Meeting was prepared by the
Investment Company to tell shareholders ("you") about the Meeting. It
lists the matters that will be voted on at the Meeting ("Proposals").
Q: What is the Proxy Statement?
A: The Proxy Statement has information about the Investment Company and
describes in detail the Proposals that will be voted on at the Meeting. It
states the vote needed for each Proposal and whether the Proposal is voted
on by all Funds together or by each Fund separately.
Q: Why did I receive the Investment Company's Proxy Statement?
A: As of June 7, 2000 (the "record date" for the Meeting), you held shares of
one or more of the Investment Company's Funds--the Equity Index, All
America, Bond or Money Market Fund. We have sent you the Proxy Statement
and a Proxy Card for each Fund you own so that you can make a decision
about the Proposals, indicate your vote on the Proxy Card(s) and return
the Card(s) to us. You may vote the shares of the Funds you held as of the
record date.
Q: How can I vote at the Meeting?
A: You may attend the meeting and cast your vote in person, or you may sign
the Proxy Card(s) and instruct the persons designated as proxies to cast
your vote at the Meeting as you indicate on the Proxy Card(s). We have
enclosed a postage prepaid envelope for return of your signed Proxy
Card(s), or you may fax your Proxy Card(s) to us at 212-224-2540.
Q: What happens if not enough shareholders vote and there is no quorum
for the Meeting?
A: The Investment Company must have a quorum with respect to each of the
Funds in order to have the Meeting and will adjourn the meeting to a later
date if not enough shareholders vote. It is very important that
shareholders complete and return their Proxy Cards so that the Meeting can
be held. Please vote and return your Proxy Card as soon as possible.
<PAGE>
Q: Who determined the Proposals to be voted on at the Meeting?
A: The Investment Company's Board of Directors decided what Proposals would
be presented to shareholders at the Meeting. The Board of Directors has
recommended that the shareholders vote FOR all of the Proposals.
Q: In Proposal 1, who are the Nominees for Director? Have they been elected
before?
A: The six Nominees for Director currently serve as directors of the
Investment Company. Information about the Nominees and their business
backgrounds is included in the Proxy Statement.
Q: In Proposal 2, why are the Investment Company Funds' fundamental
investment restrictions being modified?
A: A number of the Funds' fundamental investment restrictions reflect legal
and other restrictions that are no longer applicable to the Funds. Under
the Investment Company Act of 1940 (the "1940 Act"), the Funds must adopt
fundamental investment restrictions for investing in certain securities or
types of transactions. A "fundamental" restriction can be changed only by
the vote of the Fund's shareholders.
The proposed changes will retain fundamental investment restrictions for
the Funds to the extent required under the 1940 Act. The changes will
eliminate current fundamental investment restrictions that the 1940 Act
does not require to be fundamental. The Board of Directors intends to
adopt non-fundamental investment policies for each investment restriction
that is eliminated as a fundamental policy. A "non-fundamental" policy can
be changed from time to time by a vote of the Board of Directors.
Q: Will the changes in Proposal 2 affect the Funds' operations in any
material respect?
A: No. The primary result will be to make some investment restrictions
non-fundamental--changeable by the Board of Directors--instead of
fundamental--changeable only by the shareholders.
Q: How can I get more information about the proposed changes in Proposal 2?
A: You should first look in the Proxy Statement where proposed Changes #1-#17
are discussed. After each proposed change is stated, there is a discussion
captioned "Reason for change" that explains why the Investment Company
wants to make the change. If you need further explanation, please call
your Mutual of America Securities Corporation representative. The
representative will obtain the answer to your question or have someone
from the Investment Company call you back with the information.
ii
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Q: In Proposal 2, can I vote FOR some proposed changes and AGAINST other
changes?
A: Yes, but the Investment Company's Board of Directors has recommended
approval of all of the proposed changes for each of the Funds. To vote FOR
some changes in Proposal 2 and AGAINST others, mark on the Proxy Card "For
All (Except Any Noted Below)" and fill in on the line below the letter(s)
indicating any proposed change(s) you want to vote against.
Q: In Proposal 3, what does "ratify the selection of independent accountants"
mean?
A: The Investment Company is registered with the Securities and Exchange
Commission under the 1940 Act. The 1940 Act requires the Investment
Company's Board of Directors to select independent accountants for the
Funds, and the Board of Directors has selected Arthur Andersen LLP. The
1940 Act also requires the Board of Directors to submit its selection of
accountants to shareholders at the next shareholders' meeting following
selection of accountants. Approval by shareholders of the Board's
designation of accountants is called a "ratification" of the Board's
selection.
Q: In Proposal 4, what other matters will be brought before the Meeting for a
vote?
A: The Investment Company does not know of any other matters that will be
voted on at the Meeting. The Investment Company has advised us that it
does not anticipate shareholders will be given any additional Proposals
for consideration at the Meeting.
iii
<PAGE>
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
320 Park Avenue, New York, New York 10022
1-800-914-8716
o Equity Index Fund
o All America Fund
o Bond Fund
o Money Market Fund
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
================================================================================
Notice is hereby given that a Special Meeting of Shareholders of the Mutual of
America Institutional Funds, Inc. will be held at the offices of Mutual of
America Life Insurance Company, 320 Park Avenue, New York, New York 10022, on
August 24, 2000, at 9:30 a.m., Eastern time, for the following purposes:
1. To elect a Board of Directors;
2. To approve amendments to all of the fundamental investment
restrictions of the Funds;
3. To ratify the selection of Arthur Andersen LLP as independent
accountants for the Funds; and
4. To transact such other business as may properly come before the
Meeting.
The Board of Directors has fixed the close of business on June 7, 2000 as the
record date for the determination of shareholders entitled to notice of, and to
vote at, the Special Meeting or any adjournment thereof.
/s/ Dolores J. Morrissey
President and Chairman of the Board
July , 2000
<PAGE>
Table of Contents
<TABLE>
<CAPTION>
<S> <C>
Notice of Special Meeting of Shareholders ...................................... Cover
Proxy Statement ................................................................... 1
Proposal 1: Elect a Board of Directors ........................................ 5
Proposal 2: Approve Amendments to All Fundamental Investment Restrictions ..... 7
Change # 1 Eliminate the fundamental restriction on options and futures ..... 8
Change # 2 Eliminate the fundamental restriction on foreign securities .... 9
Change # 3 Eliminate the fundamental restriction on investing to
exercise control .................................................. 10
Change # 4 Amend the fundamental restriction on underwriting securities ...... 10
Change # 5 Eliminate the fundamental restriction on short sales .............. 11
Change # 6 Amend the fundamental restriction on commodities .................. 11
Change # 7 Amend the fundamental restriction on diversification among
issuers ........................................................... 12
Change # 8 Amend the fundamental restriction on amount of voting
securities ........................................................ 13
Change # 9 Amend the fundamental restriction on issuing senior securities .... 13
Change # 10 Amend the fundamental restriction on industry concentration ....... 14
Change # 11 Amend the fundamental restriction on real estate and mortgages .... 14
Change # 12 Eliminate the fundamental restriction on registered investment
company securities ................................................ 15
Change # 13 Eliminate the fundamental restriction on purchasing on margin ..... 16
Change # 14 Amend the fundamental restriction on borrowing and
pledging assets ................................................... 17
Change # 15 Amend the fundamental restriction on making loans ................. 18
Change # 16 Eliminate the fundamental restriction on illiquid securities ...... 19
Change # 17 Eliminate the fundamental restriction on purchase of oil, gas and
mineral interests ................................................. 20
Proposal 3: Ratify Selection of Arthur Andersen LLP as Independent
Accountants ....................................................... 21
Additional Information ......................................................... 22
Exhibit A: Proposed Fundamental Investment Restrictions ..................... A-1
Exhibit B: Current Fundamental Investment Restrictions ...................... B-1
Exhibit C: Proposed Non-Fundamental Investment Policies ..................... C-1
</TABLE>
<PAGE>
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
SPECIAL MEETING OF SHAREHOLDERS
To be held on August 24, 2000
PROXY STATEMENT
================================================================================
Mutual of America Institutional Funds, Inc., a Maryland corporation (the
"Investment Company") is furnishing this Proxy Statement in connection with the
solicitation of proxies by its Board of Directors. The proxies will be voted at
a Special Meeting of Shareholders of the Investment Company ("Meeting") to be
held at the offices of Mutual of America Life Insurance Company ("Mutual of
America"), 320 Park Avenue, 6th Floor, New York, New York 10022, on August 24,
2000 at 9:30 a.m. Eastern time, and at all adjournments thereof. The record date
for determining shareholders entitled to vote at the Meeting is the close of
business on June 7, 2000.
We are mailing or delivering this Proxy Statement, the Notice of Special Meeting
and the proxy card to shareholders on or about July , 2000. Any shareholder who
has given a proxy may revoke it prior to the Meeting by delivering written
notice to the Secretary of the Investment Company, by attending the Meeting in
person, or by executing a superseding proxy. All properly executed proxies we
receive in time for the Special Meeting will be voted as specified in the proxy
or, if there is no specification, for each proposal in the Proxy Statement.
The Investment Company has these Funds (or series): the Equity Index Fund, All
America Fund, Bond Fund and Money Market Fund (each a "Fund" and collectively,
the "Funds"). Each nominee listed in Proposal 1 who receives the affirmative
vote of a majority of all votes cast at the Meeting will be elected as a
Director. A majority of all votes cast at the Meeting is required to approve
Proposal 3. Approval of each of the Changes #1-17 in Proposal 2 requires the
affirmative vote of a "majority of the outstanding voting securities" of each
Fund. Under the Investment Company Act of 1940 (the "1940 Act"), the vote of a
"majority of the outstanding voting securities" means the affirmative vote of
the lesser of (a) 67% or more of the voting securities present at the Meeting or
represented by proxy if the holders of more than 50% of the outstanding voting
securities are present or represented by proxy, or (b) more than 50% of the
outstanding voting securities.
1
<PAGE>
The following table summarizes the Proposals in this Proxy Statement applicable
to each Fund.
Proposal Fund(s) Manner in Which the
Number Description of Proposal To Vote Funds Will Vote
1 Elect a Board of Directors All Shareholders of all Funds
(six persons named as nominees) will vote together as a
single class regarding each
nominee
2,#1-17 Approve amendments to all of All Shareholders of each Fund
the fundamental investment will vote separately on each
restrictions of the Funds, with proposed change
some restrictions eliminated if
not required to be fundamental
and others amended
3 Ratify selection of Arthur All Shareholders of all Funds
Andersen LLP as Independent will vote together as a
Accountants for the Funds single class
The table below sets forth shares outstanding of each of the Funds as of the
record date for the Meeting and the shares held by Mutual of America, which is
an affiliate of the Investment Company's investment adviser.
Shares Outstanding Shares (and %) Held
Name of Fund at June 7, 2000 by Mutual of America
Equity Index 3,317,654.5960 2,522,900.5120 (76.045%)
All America 3,923,292.7570 2,268,403.6840 (57.819%)
Bond 2,791,436.5280 2,281,585.0660 (81.735%)
Money Market 3,774,523.6140 109,958.7140 (2.913%)
In addition to Mutual of America, the following shareholders owned of record or
beneficially more than 5% of the outstanding shares of the Funds on the record
date.
Name and Address Fund Shares (and %) Held
Calvary Hospital, Inc. All America 576,402.6180-14.692%
1740 Eastchester Road
Bronx, NY 10461
Calvary Fund, Inc.
1740 Eastchester Road All America 443,228.9880-11.297%
Bronx, NY 10461
Calvary Hospital, Inc.
1740 Eastchester Road All America 473,115.3780-14.261%
Bronx, NY 10461
Manhattan College Money Market 565,339.4930-14.978%
4513 Manhattan College Parkway
Riverdale, NY 10471
Johnson O'Connor Research Money Market 295,067.1400-7.817%
Support Corporation
347 Beacon Street
Boston, MA 02116
2
<PAGE>
In determining whether a quorum exists, the Investment Company will count votes
to Abstain as shares present and voting. Any shareholder abstentions for a
Proposal will have the effect of a "no" vote.
Investment Adviser for the Funds and Subadvisers for the All America Fund.
Mutual of America Capital Management Corporation (the "Adviser"), serves as the
investment adviser for each of the Funds. The Adviser is an indirect,
wholly-owned subsidiary of Mutual of America, and its business address is 320
Park Avenue, New York, New York 10022. Two subadvisers for the All America Fund
manage approximately 20% of the Fund's assets. The names and addresses of these
subadvisers are: Fred Alger Management, Inc., 30 Montgomery Street, Jersey City,
New Jersey 07302 and Oak Associates, Ltd., 3875 Embassy Parkway, Suite 250,
Akron, Ohio 44333.
Officers of the Investment Company. The Investment Company has the following
officers, who serve without compensation from the Investment Company. The
business address of each officer is 320 Park Avenue, New York, New York 10022.
Principal Occupations
Name and Age Position Held During Past Five Years
Dolores J. Morrissey President and President, Mutual of America Securities
(age 71) Chief Executive Corporation, since August 1996; Execu-
Officer tive Vice President and Assistant to
President of Adviser, March 1996 to
December 1996; prior thereto, President
and Chief Executive Officer of Adviser
Manfred Altstadt Senior Executive Senior Executive Vice President and
(age 51) Vice President Chief Financial Officer of Adviser,
and Treasurer Mutual of America and The American
Life Insurance Company of New York
("American Life"); Director of Mutual
of America since October 1998 and
Director of American Life
Patrick A. Burns Senior Executive Senior Executive Vice President and
(age 53) Vice President General Counsel of Adviser, Mutual of
and General America and American Life; Director of
Counsel Mutual of America since October 1998
and Director of American Life
3
<PAGE>
Principal Occupations
Name and Age Position Held During Past Five Years
John R. Greed Executive Vice Executive Vice President and Treasurer,
(age 40) President and Mutual of America and American Life
Chief Financial since May 1997; Senior Vice President
Officer and Deputy Treasurer from July 1996 to
May 1997; prior thereto, Partner,
Arthur Andersen LLP
Stanley M. Lenkowicz Senior Vice Senior Vice President and Deputy
(age 58) President, General Counsel of Mutual of America
Deputy General and American Life
Counsel and
Secretary
Distributor: Mutual of America Securities Corporation is the principal
underwriter of the Funds' shares.
Annual Report: The Investment Company will furnish, without charge, a copy of
its most recent annual report and semi-annual report, containing the Funds'
financial statements. To request these reports, please call the Investment
Company at 1-800-914-8716 or write to Mutual of America Institutional Funds,
Inc., 320 Park Avenue, New York, New York 10022, Attn: Stanley M. Lenkowicz.
4
<PAGE>
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Proposal 1. Elect a Board of Directors
--------------------------------------------------------------------------------
Six Directors will be elected at the Meeting, each to serve until his or her
successor is elected and qualified. Each proxy card will be voted for the
election of the nominees listed below, unless a contrary specification is made
on the card.
The nominees for Director currently are Directors of the Investment Company and
have served in that capacity continuously since originally elected or appointed.
Each nominee has consented to serve as a Director if elected. The business
address of each nominee is indicated in the table below:
<TABLE>
<CAPTION>
Position Held Principal
With Investment Occupations During Director
Name, Address And Age Company Past Five Years Since
--------------------- --------------- ------------------ --------
<S> <C> <C> <C> <C>
Kevin M. Kearney, age 47 Director Partner, Wingate, Kearney & Cullen 2/96
32 Court Street (law firm).
Brooklyn, NY 11201
Dolores J. Morrissey*, age 71 Chairman of the President and Chief Executive Officer 10/94
320 Park Avenue Board, President of Mutual of America Securities
New York, NY 10022 and Director Corporation since August 1996; Executive
Vice President and Assistant to the
President of the Adviser from March 1996
to December 1996; prior thereto, President
and Chief Executive Officer of the Adviser.
John T. Sharkey, age 63 Director Chairman and Chief Executive Officer, 2/96
[to come] Kane, Saunders & Smart; prior thereto,
New York, NY Vice President -- Corporate National
Accounts, MCI Communications.
John R. Silber, age 73 Director Chancellor, Boston University. 2/96
147 Bay State Road
Boston, MA 02215
Stanley Shmishkiss, age 81 Director Shmishkiss Associates; Chairman 8/98
P.O. Box 909 Emeritus of the Board of Trustees of the
Lynn, MA 01904 American Cancer Society Foundation.
Patrick J. Waide, Jr., age 62 Director Retired; Past President, The Drucker 8/96
[to come] Foundation; Chief Operating Officer,
New York, NY Sullivan & Company, New York, New York
from September 1996 to December 1998;
prior thereto, Executive Vice President
and Chief Financial Officer of the
Bessemer Group, Inc., and Senior Vice
President and Chief Financial Officer of
Bessemer Securities.
</TABLE>
-------------
* Ms. Morrissey is an "interested person" (as defined in the Investment Company
Act of 1940) of the Investment Company based on her affiliation with the
Adviser or its affiliate.
Mr. [ ] currently serves as a director of [name companies]
The nominees for Director do not own any of the outstanding shares of the
Investment Company, which are available only to institutional investors.
5
<PAGE>
The Investment Company does not have an Audit Committee; the entire Board of
Directors fulfills the obligations that an Audit Committee would have. The
Investment Company also has no standing nomination, compensation or executive
committees.
During 1999, the Board of Directors held four meetings. All of the directors
attended all four meetings. Directors who are not interested persons of the
Investment Company do not serve on the Board of any other investment company in
the same complex as the Investment Company. The directors received the following
compensation for serving as directors of the Investment Company in 1999:
<TABLE>
<CAPTION>
Pension or Total Compensation
Aggregate Retirement Benefits Estimated from Investment
Compensation Accrued as Part Annual Company and Fund
from Investment of Investment Benefits Upon Complex Paid to
Name of Director Company Company Expenses Retirement Directors
<S> <C> <C> <C> <C> <C>
Kevin M. Kearney ...... $14,198 (2) None None $14,198 (2)
Dolores J. Morrissey .. None (1) None None None (1)
John T. Sharkey ....... $14,824 (2) None None $14,824 (2)
Stanley Shmishkiss .... $16,619 (2) None None $16,619 (2)
John R. Silber ........ $16,619 (2) None None $16,619 (2)
Patrick J. Waide, Jr. . $14,824 (2) None None $14,824 (2)
</TABLE>
------------
(1) As an employee of the Adviser or its affiliate and as an "interested person"
of the Investment Company, Ms. Morrissey serves as director of the
Investment Company without compensation.
(2) Directors who are not "interested persons" of the Investment Company receive
an annual retainer of $16,000 and a fee of $1,500 for each Board or
Committee meeting they attend. (During 1999, the directors received an
annual retainer of $10,000 and a $1,000 fee for each Board or Committee
meeting attended.) In addition, they receive business travel and accident
insurance and life insurance coverage of $75,000.
Required Vote. Each nominee who receives the affirmative vote of a majority of
the Investment Company Fund shares cast at the Meeting will be elected as a
Director. The Directors of the Investment Company recommend that the
shareholders of the Investment Company vote FOR each of the nominees for
Director listed in this Proposal 1.
6
<PAGE>
--------------------------------------------------------------------------------
Proposal 2: Approve Amendments to All Fundamental Investment Restrictions
--------------------------------------------------------------------------------
The Investment Company Act of 1940 (the "1940 Act") requires investment
companies to adopt fundamental policies for investing in certain types of
securities or using certain investment techniques. The Investment Company
adopted its current fundamental investment restrictions at a time when
investment companies typically adopted a lengthy list of restrictions, in part
because of state securities department requirements for investment companies
that are no longer applicable.
Changes to the Investment Company's fundamental investment restrictions require
a vote of shareholders, and the Investment Company holds meetings of
shareholders only from time to time. The Investment Company is using the
opportunity of this Meeting to request that shareholders substantially revise
and update the Funds' fundamental investment restrictions.
The Investment Company is asking that Fund shareholders eliminate a number of
fundamental restrictions that the 1940 Act does not require to be fundamental.
In several instances, 1940 Act provisions, and rules or interpretations adopted
by the Securities and Exchange Commission ("SEC") thereunder, will limit
investments by the Funds, whether or not they have a fundamental policy. The
Board of Directors intends to adopt non-fundamental investment policies covering
certain securities or investment techniques when shareholders approve
elimination of fundamental policies.
The Investment Company currently has 16 fundamental investment restrictions -- 9
are proposed to be amended and retained as fundamental, 6 are proposed to be
eliminated (and replaced with 7 non-fundamental investment policies that will be
adopted by the Board of Directors), and 1 is proposed to be eliminated as
redundant. For 3 of the 9 amended fundamental investment restrictions, the Board
of Directors also intends to adopt new corresponding non-fundamental investment
policies.
The Board of Directors has determined that approval by shareholders of the
proposed amendments to the fundamental investment restrictions is in the best
interests of the shareholders of each of the Funds. The Investment Company does
not anticipate that approval of the Proposal 2 amendments will materially affect
the operations of any Fund or its investment performance.
The purposes of the amendments under Proposal 2 are:
o to clarify or simplify the fundamental investment restrictions;
o to conform the fundamental restrictions to current provisions of the 1940
Act and related rules and regulations, as they may be amended from time to
time; and
7
<PAGE>
o to provide the Investment Company Funds with more investment flexibility,
consistent with practices that have been adopted by other registered
investment companies, by eliminating certain fundamental investment
restrictions that are not required under the 1940 Act.
Non-fundamental investment policies will allow the Funds flexibility to respond
to changed market conditions. They can be changed upon approval by the Board of
Directors, subject to any limits imposed under the 1940 Act and related rules
and interpretations, or other regulatory authorities.
Exhibit A to this Proxy Statement shows the Investment Company's proposed
fundamental investment restrictions, discussed in this Proposal 2. Exhibit B to
this Proxy Statement sets forth the Investment Company's current fundamental
investment restrictions.
For your information, Exhibit C sets forth the non-fundamental investment
policies the Board intends to adopt upon approval by a Fund's shareholders of
the proposed changes to the Fund's current fundamental investment restrictions.
Shareholders are not being asked to vote on the non-fundamental policies in
Exhibit C.
Change #1. Eliminate the fundamental restriction on options and futures
================================================================================
The Funds' current fundamental investment restriction concerning options and
futures contracts states:
No Fund will purchase or sell options or futures except those listed on a
domestic exchange.
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will purchase or sell options or futures contracts or options on
futures contracts unless the options or contracts relate to U.S. issuers or
U.S. stock indexes and are not for speculation, and in addition (i) a Fund
may write only covered call options and may buy put options only if it holds
the related securities, (ii) a Fund may invest in futures contracts to hedge
not more than 20% of its total assets, and (iii) premiums paid on
outstanding options contracts may not exceed 5% of a Fund's total assets.
Reason for change: The 1940 Act does not require the Investment Company to have
a fundamental policy on options and futures contracts. The non-fundamental
policy recognizes that not all options contracts are listed on exchanges, sets
forth
8
<PAGE>
certain restrictions on options and hedging transactions that currently are set
forth elsewhere in the Investment Company's Prospectus or Statement of
Additional Information ("SAI") and imposes additional limitations on the amount
of a Fund's options and futures contracts. The purchase of options and futures
contracts by a Fund may offset either positive or negative changes in the price
levels of a portfolio security or a securities index. The Funds' permitted
investment strategies for options and futures contracts and related risks are
described in the Investment Company's Prospectus and SAI, each dated May 1,
2000. A non-fundamental policy will allow the Directors to update the
restriction in response to changes in applicable law, investment experiences by
the Funds and current market conditions.
Change #2. Eliminate the fundamental restriction on foreign securities
================================================================================
The Funds' current fundamental investment restriction concerning foreign
exchange and foreign securities states:
No Fund will trade in foreign exchange, or invest in securities of foreign
issuers if at the time of acquisition more than 20% of its total assets,
taken at market value at the time of the investment, would be invested in
such securities.
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will invest in foreign exchange nor invest more than 25% of its
total assets in securities of foreign issuers and American Depository
Receipts (ADRs).
Reason for change: The 1940 Act does not require the Investment Company to have
a fundamental policy on foreign securities. The proposed non-fundamental policy
clarifies that the Funds may not trade in foreign exchange and includes ADRs in
the restriction on foreign securities. ADRs are securities of foreign issuers
that are deposited with a U.S. financial institution, which issues receipts for
the securities. ADRs are subject to the same issuer risks as foreign securities,
although they are not subject to foreign custodian risks. The Investment Company
considers it appropriate that there be an aggregate limit on a Fund's holdings
of foreign securities and ADRs. A non-fundamental policy will allow the
Directors to update the restriction in response to investment experiences by the
Funds and current market conditions.
9
<PAGE>
Change #3. Eliminate the fundamental restriction on investing to exercise
control
================================================================================
The Funds' current fundamental investment restriction concerning investing to
exercise control over management of a company states:
No Fund will make an investment in order to exercise control of management
over a company (either singly or together with any other Fund).
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will invest for the purpose of exercising control over management of
an issuer (either separately or together with any other Funds).
Reason for change: The 1940 Act does not require the Investment Company to have
a fundamental policy on exercise of control. The Investment Company Funds have
no current intention of investing for the purpose of exercising control over
management, and 1940 Act diversification requirements limit the ability of a
Fund to invest to gain control of an issuer.
Change #4. Amend the fundamental restriction on underwriting securities
================================================================================
The Funds' current fundamental investment restriction concerning underwriting
securities states:
No Fund will underwrite the securities of other companies.
The proposed change would amend the restriction and retain it as fundamental:
No Fund will underwrite the securities issued by other companies, except to
the extent that the Fund's purchase and sale of portfolio securities may be
deemed to be an underwriting.
Reason for change: Underwriting the securities of an issuing company means
participating in the sale and distribution of the company's securities. If a
Fund purchases and sells a security that has not been registered for sale under
the Securities Act of 1933 (the "1933 Act"), the Fund may technically be an
underwriter for purposes of the 1933 Act. The proposed restriction retains but
restates the Funds' existing restriction on underwriting, by providing that the
Funds will not underwrite securities except to the extent their purchase and
sale of unregistered securities might technically be considered to be an
underwriting.
10
<PAGE>
Change #5. Eliminate the fundamental restriction on short sales
================================================================================
The Funds' current fundamental investment restriction concerning the making of
short sales states:
No Fund will make short sales, except when the Fund has, by reason of
ownership of other securities, the right to obtain securities of equivalent
kind and amount that will be held so long as they are in a short position.
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will make short sales, except when the Fund owns or has the right to
obtain securities of equivalent kind and amount that will be held for as
long as the Fund is in a short position.
Reason for change. The 1940 Act does not require the Investment Company to have
a fundamental policy on short sales. The Funds presently have no intention of
engaging in "short sales", which are a form of borrowing. If a Fund were to sell
short, it would sell borrowed securities with the hope of purchasing securities
of the same type at a lower price, or furnishing securities of the same type
that it already owns, to replace the borrowed securities. The Investment Company
initially adopted the short sale restriction based on requirements of certain
state securities departments, which are no longer applicable to investment
companies. Under both the Investment Company's existing fundamental investment
restriction and the proposed non-fundamental investment policy, a Fund may
engage in a short sale only when it owns or has the right to obtain the same
securities it is selling short, which is called a "short sale against the box".
Short sales by the Funds are limited under 1940 Act provisions and SEC
interpretations of those provisions that restrict borrowing by an investment
company.
Change #6. Amend the fundamental restriction on commodities
================================================================================
The Funds' current fundamental investment restriction concerning the purchase of
commodities or commodities contracts states:
No Fund will purchase commodities or commodities contracts, except to the
extent described in the Prospectus and herein with respect to futures and
related options.
11
<PAGE>
The proposed change would reword the restriction and retain it as fundamental:
No Fund will purchase physical commodities or contracts involving physical
commodities.
Reason for change: Financial futures contracts are traded on commodities
exchanges, and the Funds may invest in financial futures contracts. The change
clarifies that the restriction applies only to the Funds' purchase of physical
(or tangible) commodities products.
Change #7. Amend the fundamental restriction on diversification among issuers
================================================================================
The Funds' current fundamental investment restriction concerning diversification
of investments among issuers states:
No Fund will with respect to at least 75% of the value of its total assets,
invest more than 5% of its total assets in the securities of any one issuer
(including repurchase agreements with any one institution), other than
securities issued or guaranteed by the United States Government or its
agencies or instrumentalities.
The proposed change would amend the restriction and retain it as fundamental:
No Fund will, based on its investments in individual issuers, be
non-diversified as defined under the 1940 Act, which currently restricts a
Fund, with respect to 75% of the value of its total assets, from investing
more than 5% of its total assets in the securities of any one issuer, other
than (i) securities issued or guaranteed by the United States Government or
its agencies or instrumentalities ("U.S. Government Securities"), and (ii)
securities of other registered investment companies; in addition the Money
Market Fund will not invest in any securities that would cause it to fail to
comply with applicable diversification requirements for money market funds
under the 1940 Act and rules thereunder, as amended from time to time.
Reason for change: The proposed restriction refers to the 1940 Act
diversification requirement, allowing automatic updating if the requirement
changes. It also sets forth the restrictions under current law and adds the
permitted exclusion of the securities of other investment companies. The Funds
will be able to invest in investment company securities to the extent permitted
under the 1940 Act (currently limited to 10% of total assets) and any exemptive
relief granted by the SEC. The Funds have no current intention of purchasing the
securities of other investment companies.
12
<PAGE>
Change #8. Amend the fundamental restriction on amount of voting securities
================================================================================
The Funds' current fundamental investment restriction concerning the purchase of
an issuer's voting securities states:
No Fund will with respect to at least 75% of the value of its total assets,
purchase more than 10% of the outstanding voting securities of an issuer,
except that such restriction shall not apply to securities issued or
guaranteed by the United States Government or its agencies or
instrumentalities.
The proposed change would reword the restriction and retain it as fundamental:
No Fund will, based on its investment in an issuer's voting securities, be
non-diversified as defined under the 1940 Act, which currently restricts a
Fund, with respect to 75% of the value of its total assets, from purchasing
more than 10% of the outstanding voting securities of any one issuer other
than (i) U.S. Government Securities, and (ii) securities of other registered
investment companies, and imposes additional restrictions on the Money
Market Fund.
Reason for change: The proposed restriction refers to the 1940 Act
diversification requirement regarding the purchase of voting securities,
allowing automatic updating if the requirement changes. It also sets forth the
restriction under current law and adds the permitted exclusion of the securities
of other investment companies. The Funds will be able to invest in such
securities to the extent permitted under the 1940 Act (currently limited to 10%
of total assets) and any applicable exemptive relief. The Funds have no current
intention of purchasing the securities of other investment companies.
Change #9. Amend the fundamental restriction on issuing senior securities
================================================================================
The Funds' current fundamental investment restriction concerning the issuance of
senior securities states:
No Fund will issue senior securities, except that each Fund may borrow as
described in restriction 13 below (the issuance and sale of options and
futures not being considered the issuance of senior securities) and except
as permitted by the rules and regulations of the Investment Company Act or
an exemption thereunder and with any required approval of the shareholders
of the Investment Company.
The proposed change would reword the restriction and retain it as fundamental:
No Fund will issue senior securities, except as permitted under the 1940 Act
and the rules thereunder as amended from time to time.
13
<PAGE>
Reason for change: The proposed restriction simplifies the wording. Under the
1940 Act, borrowing and certain other transactions by an investment company are
viewed as creating "senior securities". Senior securities, as debt, would be
entitled to payment prior to the claims of the investment company's
shareholders. The 1940 Act and related rules and interpretations permit an
investment company to issue senior securities, including through borrowing, in
certain circumstances. The reference to these provisions will in effect
incorporate them into the fundamental restriction.
Change #10. Amend the fundamental restriction on industry concentration
================================================================================
The Funds' current fundamental investment restriction concerning the
concentration of investments in any industry states:
No Fund will make an investment in an industry if that investment would make
the Fund's holding in that industry exceed 25% of the Fund's total assets,
except that this policy does not apply to obligations issued or guaranteed
by the U.S. Government or its agencies or instrumentalities.
The proposed change would amend the restriction and retain it as fundamental:
No Fund will invest more than 25% of its assets in the securities of issuers
in one industry, other than U.S. Government Securities, except that the
Money Market Fund may invest more than 25% of its total assets in the
financial services industry.
Reason for change: The proposed restriction simplifies the wording and would
allow the Money Market Fund to concentrate in the financial services industry.
Credit companies and banks tend to be active issuers of the types of securities
in which the Money Market Fund may invest. At times, the Money Market Fund may
need to concentrate its investments in the financial services industry in order
to maximize its investment performance.
Change #11. Amend the fundamental restriction on real estate and mortgages
================================================================================
The Funds' current fundamental investment restriction concerning the purchase of
real estate or mortgages states:
No Fund will purchase real estate or mortgages directly, except that the All
America Fund may buy shares of real estate investment trusts listed on stock
exchanges or reported on the National Association of Securities Dealers
Automated Quotations ("NASDAQ") system, and the Bond Fund may buy
mortgage-backed debt issues.
14
<PAGE>
The proposed change would amend the restriction and retain it as fundamental:
No Fund will purchase real estate or mortgages directly, but a Fund may
invest in mortgage-backed securities and may purchase the securities of
companies whose businesses deal in real estate or mortgages, including real
estate investment trusts.
If a Fund's shareholders approve the proposed change, the Directors intend to
adopt the following additional non-fundamental investment policy:
No Fund will, if its investment policy is to invest primarily in equity
securities, purchase mortgage-backed securities unless they are also U.S.
Government Securities, or if its investment policy is to invest primarily in
fixed income securities, invest more than 10% of its total assets in
mortgage-backed securities that are not also U.S. Government Securities.
Reason for change: The revised fundamental policy allows all of the Funds to
purchase mortgage-backed securities. The non-fundamental policy will limit
purchases of these securities by the Investment Company's equity funds to U.S.
Government Securities, which are liquid and may be appropriate for investment by
the equity funds in certain market conditions. The policy's limit for fixed
income Funds currently is included in the Investment Company's SAI. A
non-fundamental policy will allow the Directors to update the restriction in
response to investment experiences by the Funds and current market conditions.
Change #12. Eliminate the fundamental restriction on registered investment
company securities
================================================================================
The Funds' current fundamental investment restriction concerning investment in
the securities of other registered investment companies states:
No Fund will purchase any securities issued by any other investment company,
except as permitted under the Investment Company Act and in accordance with
applicable state law.
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will invest in the securities of any registered investment company,
except as permitted under the Investment Company Act of 1940 and the rules
thereunder, as amended from time to time, or by any exemptive relief granted
by the SEC.
15
<PAGE>
Reason for change: The 1940 Act does not require the Investment Company to have
a fundamental policy for the purchase of investment company securities. Under
current 1940 Act provisions, a Fund may invest up to 10% of its total assets in
the securities of other registered investment companies, may invest not more
than 5% of its total assets in the securities of any one registered investment
company and may not own more than 3% of an investment company's outstanding
voting securities. The Funds do not have any current intention of investing in
registered investment company securities.
Change #13. Eliminate the fundamental restriction on purchasing on margin
================================================================================
The Funds' current fundamental investment restriction concerning purchasing
securities on margin, borrowing money and pledging assets states:
No Fund will purchase any security on margin, except for short-term credit
necessary for clearance of portfolio transactions or in connection with
permitted options and futures contracts, or borrow money, except from banks
for temporary purposes, or pledge its assets unless to secure such
borrowing. The Funds may borrow money from or pledge their assets to banks
in order to transfer funds for various purposes, as required, without
interfering with the orderly liquidation of securities in their portfolios,
but not for leveraging purposes. Such borrowings may not exceed 5% of the
value of Fund's total assets at market value.
The proposed change for purchasing on margin would eliminate the restriction as
a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will purchase securities on margin, except that credits for the
clearance of portfolio transactions and the making of margin payments for
futures contracts and options on futures contracts shall not constitute the
purchasing of securities on margin.
Reason for change: The Funds presently have no intention of "purchasing
securities on margin," which is a form of borrowing. If a Fund were to purchase
securities on margin, it would pay only a portion of the purchase price (the
margin) and borrow the remainder of the purchase price from a broker. The
Investment Company initially adopted the margin restriction based on
requirements of certain state securities departments, which are no longer
applicable to investment companies. The Funds are prohibited from making margin
purchases under the 1940 Act, which restricts the creation of senior securities
through borrowing.
16
<PAGE>
Change #14. Amend the fundamental restriction on borrowing and pledging assets
================================================================================
The Funds' current fundamental investment restriction concerning borrowing money
and pledging assets, which also covers purchasing on margin, is set forth above
under Change #13. The proposed change for borrowing money and pledging assets
would amend the restriction and retain it as fundamental:
No Fund will borrow money, except to the extent permitted by the 1940 Act
and rules thereunder, as amended from time to time, which currently limit a
Fund's borrowing to 33 1/3% of total assets (including the amount borrowed)
minus liabilities (other than borrowings) and require the reduction of any
excess borrowing within three business days.
If a Fund's shareholders approve the proposed change, the Directors intend to
adopt an additional, non-fundamental investment policy regarding borrowing:
No Fund will borrow money except for temporary or emergency purposes (not
for investment or leveraging) or under any reverse repurchase agreement,
provided that a Fund's aggregate borrowings may not exceed 10% of the value
of the Fund's total assets and it may not purchase additional securities if
its borrowings exceed that limit.
Reason for change: The proposed fundamental restriction refers to the 1940 Act
restriction on borrowing, allowing automatic updating if the requirement
changes, and sets forth the restriction under current law. The existing
restriction on pledging assets, which is proposed to be eliminated, was based on
state securities law requirements that are no longer applicable to investment
companies, and the Investment Company considers that the 1940 Act provisions on
borrowing are appropriate to address the pledge of assets. The non-fundamental
policy will establish limits on a Fund's borrowing that are consistent with the
limits currently applicable to the Funds and allow the Directors to update the
restriction in response to investment experiences by the Funds and current
market conditions.
The Investment Company contemplates that Funds in some circumstances may borrow
to meet liquidity needs. The Funds maintain a certain amount of cash in their
portfolios in order to meet redemption requests from shareholders. At times, the
amount of cash may be inadequate to meet all redemption requests. If a Fund must
sell securities to raise cash to pay the redeeming shareholder, there will be a
timing difference between when the Fund pays the shareholder and when it
receives the proceeds from sale of the securities. This difference occurs
because when a shareholder redeems from a Fund, the shareholder normally
receives the redemption proceeds on the next business day. When a Fund sells
securities, however, the settlement date, meaning the date it receives the sale
proceeds, occurs
17
<PAGE>
up to three business days after the sale of securities. If a Fund must sell
securities to pay redemption proceeds to a shareholder, it may need to borrow
money on a temporary basis until it receives sale proceeds on the settlement
date.
Under current law, the Funds may borrow only from banks. If the proposed
amendments to the Funds' fundamental investment restrictions on borrowing are
approved by Fund shareholders, the Investment Company, on behalf of the
approving Funds, may apply to the SEC for an exemption from the prohibition on
borrowing from another Fund or a fund of an affiliated investment company (an
"Affiliated Portfolio"). There is no assurance that the SEC will grant the
exemption. If the SEC does grant the exemption, each Fund covered by the
application would be allowed to borrow from Affiliated Portfolios in accordance
with the conditions in the SEC exemptive order. The Investment Company would
borrow from an Affiliated Portfolio rather than a bank only when the borrowing
Fund would pay a lower rate of interest than available through bank loans for
comparable short-term investments. Before the Investment Company could file an
exemptive application with the SEC, the Board of Directors would have to review
the proposed borrowing program and determine that it would provide potential
benefits to the Funds, including more flexibility in engaging in borrowing
transactions and the possibility of borrowing in a more cost-effective manner.
Change #15. Amend the fundamental restriction on making loans
================================================================================
The Funds' current fundamental investment restriction concerning making loans
states:
No Fund will make loans, except loans of portfolio securities (not exceeding
30% of the value of its total assets at market value) or loans through entry
into repurchase agreements (the purchase of publicly traded debt obligations
not being considered the making of a loan).
The proposed change would amend the restriction and retain it as fundamental:
No Fund will lend assets to other persons (with a Fund's entry into
repurchase agreements or the purchase of debt securities not being
considered the making of a loan), except to the extent permitted by the 1940
Act, the rules thereunder and applicable SEC guidelines, as amended from
time to time, which currently limit a Fund's lending to 33 1/3% of its total
assets, or pursuant to any exemptive relief granted by the SEC.
If a Fund's shareholders approve the proposed change, the Directors intend to
adopt an additional, non-fundamental investment policy regarding lending assets:
No Fund will lend more than 10% of its assets.
18
<PAGE>
Reason for change: The proposed fundamental restriction refers to the 1940 Act
restriction on lending, allowing automatic updating if the requirement changes,
and sets forth the restriction under current law. The non-fundamental policy
will limit a Fund's borrowing and allow the Directors to update the lending
restriction in response to investment experiences by the Funds and current
market conditions.
Under current law, the Funds may not lend to other Funds. If the proposed
amendments to the Funds' fundamental investment restrictions on making loans are
approved by Fund shareholders, the Investment Company, on behalf of the
approving Funds, may apply to the SEC for an exemption from the prohibition on
lending to Affiliated Portfolios ("interfund lending"). There is no assurance
that the SEC will grant the exemption. If the SEC does grant the exemption, each
Fund covered by the application would be allowed to lend to Affiliated
Portfolios to the extent set forth in the non-fundamental policy and in
accordance with the conditions in the SEC exemptive order. Each Fund maintains a
certain amount of cash in its portfolio in order to meet redemption requests as
they occur, and the Funds invest this cash on a short-term basis. A Fund would
lend assets to an affiliate only if it would receive a greater return than
available under other short-term investments. Before the Investment Company
could file an exemptive application with the SEC, the Board of Directors would
have to review the proposed interfund lending program and master loan agreement,
including risks to the Funds, and determine that interfund lending would provide
potential benefits to the Funds, including more flexibility in engaging in
lending transactions and the possibility of earning higher returns on short-term
investments.
Change #16. Eliminate the fundamental restriction on illiquid securities
================================================================================
The Funds' current fundamental investment restriction concerning illiquid
securities states:
No Fund will invest more than 10% of its total assets in repurchase
agreements or time deposits maturing in more than seven days or in portfolio
securities not readily marketable.
The proposed change would eliminate the restriction as a fundamental policy.
If a Fund's shareholders approve the change, the Directors intend to adopt the
following non-fundamental investment policy for the Fund:
No Fund will invest more than 10% of its total assets in securities that are
considered to be illiquid because they are subject to legal or contractual
restrictions on resale or are otherwise not readily marketable, including
repurchase agreements and time deposits that do not mature within seven days
but excluding Rule 144A securities and other restricted securities that are
determined to be liquid pursuant to procedures adopted by the Board of
Directors.
19
<PAGE>
Reason for change: The 1940 Act does not require the Investment Company to adopt
a fundamental policy on the purchase of illiquid securities. The Investment
Company initially adopted the 10% restriction based on the requirements of
certain state securities departments, which are no longer applicable to
investment companies. Under the 1940 Act, a Fund's investment in illiquid
securities is limited to 15% of total assets. The non-fundamental policy will
allow the Directors to update the restriction in response to changes in
applicable law, investment experiences by the Funds and current market
conditions.
Change #17. Eliminate the fundamental restriction on purchase of oil, gas and
mineral interests
================================================================================
The Funds' current fundamental investment restriction concerning the purchase
of oil, gas and mineral interests states:
No Fund will purchase oil, gas or mineral interests, except that the Funds
may purchase securities of issuers that invest in oil, gas or mineral
interests.
The proposed change would eliminate the restriction.
Reason for change: The Funds do not have the authority to purchase oil, gas or
mineral interests, so the restriction is unnecessary.
Required Vote for Proposal 2, Changes #1-#17. The shares of each Fund will vote
separately on each proposed change #1-#17 to the Fund's fundamental investment
restrictions. Approval by a Fund of a proposed change requires the affirmative
vote of a majority of the outstanding shares of that Fund. The approval of any
one proposed change for a Fund is not conditioned on any other proposed change
being approved by the Fund's shareholders or shareholders of other Funds. The
Directors of the Investment Company recommend that the shareholders of each Fund
vote FOR this Proposal 2, Changes #1 through #17.
20
<PAGE>
--------------------------------------------------------------------------------
Proposal 3. Ratify Selection of Arthur Andersen LLP as Independent
Accountants
--------------------------------------------------------------------------------
The Board of Directors, including a majority of the Directors who are not
interested persons of the Investment Company, has selected the firm of Arthur
Andersen LLP, independent certified public accountants ("Arthur Andersen"), to
audit the financial statements of the Investment Company Funds for the year
ending December 31, 2000. Arthur Andersen also acts as independent certified
public accountants for Mutual of America and its subsidiaries, including the
Adviser.
The Investment Company's independent accountants audit the Investment Company's
annual financial statements and provide tax services. Arthur Andersen does not
provide consulting services for the Investment Company, Mutual of America or any
of its subsidiaries. Representatives of Arthur Andersen are not expected to be
present at the Meeting, but they will have the opportunity to make a statement
if they so desire and will be available if any matter requiring their presence
arises at the Meeting.
Required Vote. Ratification of the selection of Arthur Andersen LLP as
independent accountants requires the approval of a majority of the Investment
Company Fund shares voting at the Meeting. The Directors of the Investment
Company recommend that the shareholders of each Fund vote FOR this Proposal 3.
21
<PAGE>
--------------------------------------------------------------------------------
Additional Information
--------------------------------------------------------------------------------
Other Business to Come Before the Meeting. The Board does not know of any other
business to be brought before the Meeting. If any other matters properly come
before the Meeting, however, proxy cards that do not contain specific
instructions to the contrary will be voted on the additional matters in
accordance with the judgment of the persons designated in the proxy cards to
serve as proxies.
Proposals of Shareholders. Any shareholders who wish to submit any proposal for
inclusion in a proxy statement for a shareholder meeting that takes place after
the Meeting should send their written proposals to the Secretary of the
Investment Company, 320 Park Avenue, New York, New York 10022 within a
reasonable time before the solicitation of proxies for the next shareholders
meeting. Even if a shareholder submits a proposal on a timely basis, the
inclusion of the proposal in the Investment Company's proxy statement is not
guaranteed.
Payment of Costs Related to the Meeting. The costs of preparing, printing and
delivering the Notice of Special Meeting, Proxy Statement and proxy cards to the
shareholders and of soliciting shareholders are chargeable to the Investment
Company. Mutual of America Capital Management Corporation, the Adviser for the
Investment Company, however, voluntarily limits the expenses of the Funds of the
Investment Company other than the Funds' investment advisory fees and portfolio
transactions costs.
July , 2000
22
<PAGE>
EXHIBIT A
PROPOSED FUNDAMENTAL INVESTMENT RESTRICTIONS
The following investment restrictions are fundamental. A Fund may not change
these policies unless a majority of the outstanding voting shares of the Fund
approves the change. No Fund will:
1. underwrite the securities issued by other companies, except to the extent
that the Fund's purchase and sale of portfolio securities may be deemed to
be an underwriting;
2. purchase physical commodities or contracts involving physical commodities;
3. based on its investments in individual issuers, be non-diversified as
defined under the 1940 Act, which currently restricts a Fund, with respect
to 75% of the value of its total assets, from investing more than 5% of its
total assets in the securities of any one issuer, other than (i) securities
issued or guaranteed by the United States Government or its agencies or
instrumentalities ("U.S. Government Securities"), and (ii) securities of
other registered investment companies; in addition the Money Market Fund
will not invest in any securities that would cause it to fail to comply with
applicable diversification requirements for money market funds under the
1940 Act and rules thereunder, as amended from time to time;
4. based on its investment in an issuer's voting securities, be non-diversified
as defined under the 1940 Act, which currently restricts a Fund, with
respect to 75% of the value of its total assets, from purchasing more than
10% of the outstanding voting securities of any one issuer other than (i)
U.S. Government Securities, and (ii) securities of other registered
investment companies, and imposes additional restrictions on the Money
Market Fund;
5. issue senior securities, except as permitted under the 1940 Act and the
rules thereunder as amended from time to time;
6. invest more than 25% of its assets in the securities of issuers in one
industry, other than U.S. Government Securities, except that the Money
Market Fund may invest more than 25% of its total assets in the financial
services industry;
7. purchase real estate or mortgages directly, but a Fund may invest in
mortgage-backed securities and may purchase the securities of companies
whose businesses deal in real estate or mortgages, including real estate
investment trusts;
A-1
<PAGE>
8. borrow money, except to the extent permitted by the 1940 Act and rules
thereunder, as amended from time to time, which currently limit a Fund's
borrowing to 33 1/3% of total assets (including the amount borrowed) minus
liabilities (other than borrowings) and require the reduction of any excess
borrowing within three business days; or
9. lend assets to other persons (with a Fund's entry into repurchase agreements
or the purchase of debt securities not being considered the making of a
loan), except to the extent permitted by the 1940 Act, the rules thereunder
and applicable SEC guidelines, as amended from time to time, which currently
limit a Fund's lending to 33 1/3% of its total assets, or pursuant to any
exemptive relief granted by the SEC.
A-2
<PAGE>
EXHIBIT B
CURRENT FUNDAMENTAL INVESTMENT RESTRICTIONS
The following investment restrictions are fundamental policies and may not be
changed without the approval of a majority of the outstanding voting shares of
the affected Fund. No Fund will:
1. purchase or sell options or futures except those listed on a domestic
exchange;
2. trade in foreign exchange, or invest in securities of foreign issuers if at
the time of acquisition more than 20% of its total assets, taken at market
value at the time of the investment, would be invested in such securities;
3. make an investment in order to exercise control of management over a company
(either singly or together with any other Fund);
4. underwrite the securities of other companies;
5. make short sales, except when the Fund has, by reason of ownership of other
securities, the right to obtain securities of equivalent kind and amount
that will be held so long as they are in a short position;
6. purchase commodities or commodities contracts, except to the extent
described in the Prospectus and herein with respect to futures and related
options;
7. with respect to at least 75% of the value of its total assets, invest more
than 5% of its total assets in the securities of any one issuer (including
repurchase agreements with any one institution), other than securities
issued or guaranteed by the United States Government or its agencies or
instrumentalities;
8. with respect to at least 75% of the value of its total assets, purchase more
than 10% of the outstanding voting securities of an issuer, except that such
restriction shall not apply to securities issued or guaranteed by the United
States Government or its agencies or instrumentalities;
9. issue senior securities, except that each Fund may borrow as described in
restriction 13 below (the issuance and sale of options and futures not being
considered the issuance of senior securities) and except as permitted by the
rules and regulations of the Investment Company Act or an exemption
thereunder and with any required approval of the shareholders of the
Investment Company;
B-1
<PAGE>
10. make an investment in an industry if that investment would make the Fund's
holding in that industry exceed 25% of the Fund's total assets, except that
this policy does not apply to obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities;
11. purchase real estate or mortgages directly, except that the All America Fund
may buy shares of real estate investment trusts listed on stock exchanges or
reported on the National Association of Securities Dealers Automated
Quotations ("NASDAQ") system, and the Bond Fund may buy mortgage-backed debt
issues;
12. purchase any securities issued by any other investment company except as
permitted under the Investment Company Act and in accordance with applicable
state law;
13. purchase any security on margin, except for short-term credit necessary for
clearance of portfolio transactions or in connection with permitted options
and futures contracts, or borrow money, except from banks for temporary
purposes, or pledge its assets unless to secure such borrowing. The Funds
may borrow money from or pledge their assets to banks in order to transfer
funds for various purposes, as required, without interfering with the
orderly liquidation of securities in their portfolios, but not for
leveraging purposes. Such borrowings may not exceed 5% of the value of a
Fund's total assets at market value;
14. make loans, except loans of portfolio securities (not exceeding 30% of the
value of its total assets at market value) or loans through entry into
repurchase agreements (the purchase of publicly traded debt obligations not
being considered the making of a loan);
15. invest more than 10% of its total assets in repurchase agreements or time
deposits maturing in more than seven days or in portfolio securities not
readily marketable; or
16. purchase oil, gas or mineral interests, except that the Funds may purchase
securities of issuers that invest in oil, gas or mineral interests.
B-2
<PAGE>
EXHIBIT C
PROPOSED NON-FUNDAMENTAL INVESTMENT POLICIES
Below are the non-fundamental investment policies that the Board of Directors of
the Investment Company intends to adopt for the Funds whose shareholders approve
the proposed amendments to the Funds' fundamental investment restrictions.
The following investment restrictions are not fundamental policies. They may be
changed without shareholder approval by a vote of the Board of Directors of the
Investment Company, subject to any limits imposed under the 1940 Act and related
rules and interpretations or other regulatory authorities. No Fund will:
1. purchase or sell options or futures contracts or options on futures
contracts unless the options or contracts relate to U.S. issuers or U.S.
stock indexes and are not for speculation, and in addition (i) a Fund may
write only covered call options and may buy put options only if it holds the
related securities, (ii) a Fund may invest in futures contracts to hedge not
more than 20% of its total assets, and (iii) premiums paid on outstanding
options contracts may not exceed 5% of the Fund's total assets;
2. invest in foreign exchange nor invest more than 25% of its total assets in
securities of foreign issuers and American Depository Receipts (ADRs);
3. invest for the purpose of exercising control over management of an issuer
(either separately or together with any other Funds);
4. make short sales, except when the Fund owns or has the right to obtain
securities of equivalent kind and amount that will be held for as long as
the Fund is in a short position;
5. if its investment policy is to invest primarily in equity securities,
purchase mortgage-backed securities unless they are also U.S. Government
Securities, or if its investment policy is to invest primarily in fixed
income securities, invest more than 10% of its total assets in
mortgage-backed securities that are not also U.S. Government Securities;
6. invest in the securities of any registered investment company except as
permitted under the Investment Company Act of 1940 and the rules thereunder,
as amended from time to time, or by any exemptive relief granted by the SEC;
C-1
<PAGE>
7. purchase securities on margin, except that credits for the clearance of
portfolio transactions and the making of margin payments for futures
contracts and options on futures contracts shall not constitute the
purchasing of securities on margin;
8. borrow money except for temporary or emergency purposes (not for investment
or leveraging) or under any reverse repurchase agreement, provided that a
Fund's aggregate borrowings may not exceed 10% of the value of the Fund's
total assets and it may not purchase additional securities if its borrowings
exceed that limit;
9. lend more than 10% of its assets;
10. invest more than 10% of its total assets in securities that are considered
to be illiquid because they are subject to legal or contractual restrictions
on resale or are otherwise not readily marketable, including repurchase
agreements and time deposits that do not mature within seven days but
excluding Rule 144A securities and other restricted securities that are
determined to be liquid pursuant to procedures adopted by the Board of
Directors;
11. invest more than 5% of its total assets in equipment trust certificates;*
12. invest more than 10% of its total assets in asset-backed securities or
purchase the most speculative series or class of asset-backed securities
issues;*
13. purchase the most speculative series or class of collateralized mortgage
obligation issues or other mortgage-backed securities issues;*
14. invest in interest-only strips or principal only strips of asset-backed
securities, mortgage-backed securities or other debt securities;*
15. invest more than 5% of its assets in warrants*; or
16. invest more than 10% of its assets in preferred stock.*
-------------
* The Investment Company's Statement of Additional Information, dated May 1,
2000, describes these policies as current intentions of the Funds, and the
Board intends to adopt them as non-fundamental investment policies.
C-2
<PAGE>
MUTUAL OF AMERICA
320 PARK AVENUE
NEW YORK, NEW YORK 10022-6839
ALL AMERICA FUND
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
320 Park Avenue, New York, New York 10022
Special Meeting of Shareholders--August 24, 2000, 9:30 a.m.
This proxy is solicited on behalf of the Board of Directors of Mutual of America
Institutional Funds, Inc. ("Investment Company"). The undersigned hereby
appoints Patrick A. Burns and Stanley M. Lenkowicz and each of them (with power
of substitution) to attend the Special Meeting of Shareholders, and all
adjournments thereof, and to vote all shares of common stock of the Investment
Company held of record. The Proposals to be voted on are discussed in the Notice
of Special Meeting and Proxy Statement, each dated July , 2000.
If you sign below but leave the Card blank, the Investment Company will vote
your Shares FOR all matters.
- To vote by mail, an authorized person should sign below
and return the Card in the envelope provided
- To vote by fax, call 1-212-224-2540
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: X
--------------------------------------------------------------------------------
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. -- ALL AMERICA FUND
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
THE MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE FOLLOWING:
Vote On Proposals
1. To Elect a Board of Directors:
For Withhold For All
All All Except
1. Kevin M. Kearney [ ] [ ] [ ]
2. Dolores J. Morrissey
3. John T. Sharkey
4. John R. Silber
5. Stanley Shmishkiss
6. Patrick J. Waide, Jr.
----------------------------------------------------------
To withhold authority to vote for a nominee, mark "For All
Except" and write the nominee's number on the line above.
2. To approve amended fundamental investment restrictions to: (a) delete
restrictions that are no longer required to be fundamental due to changes in
state laws or which otherwise need not be fundamental; and (b) revise the
language of those restrictions that are still required to be fundamental:
For All
(Except Any Against Abstain
Noted Below) All All
[ ] [ ] [ ]
Changes Proposed
1. Options and futures
2. Foreign securities
3. Exercise of control
4. Underwriting securities
5. Making short sales
6. Commodities
7. Issuer diversification
8. Voting securities
9. Senior securities
10. Industry concentration
11. Real estate and mortgages
12. Investment company securities
13. Purchasing on margin
14. Borrowing money
15. Lending Fund assets
16. Illiquid securities
17. Oil, gas and mineral interests
------------------------------------------------------------
To vote against any Change, mark "For All (Except Any Noted
Below)" and write the Change's letter on the line above.
For Against Abstain
3. To ratify the Board's selection of Arthur
Andersen LLP as independent accountants [ ] [ ] [ ]
4. To transact any other business before Meeting [ ] [ ] [ ]
---------------------------------------- -----------------------------------
Signature Date Print Name and Title
<PAGE>
MUTUAL OF AMERICA
320 PARK AVENUE
NEW YORK, NEW YORK 10022-6839
EQUITY INDEX FUND
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
320 Park Avenue, New York, New York 10022
Special Meeting of Shareholders--August 24, 2000, 9:30 a.m.
This proxy is solicited on behalf of the Board of Directors of Mutual of America
Institutional Funds, Inc. ("Investment Company"). The undersigned hereby
appoints Patrick A. Burns and Stanley M. Lenkowicz and each of them (with power
of substitution) to attend the Special Meeting of Shareholders, and all
adjournments thereof, and to vote all shares of common stock of the Investment
Company held of record. The Proposals to be voted on are discussed in the Notice
of Special Meeting and Proxy Statement, each dated July , 2000.
If you sign below but leave the Card blank, the Investment Company will vote
your Shares FOR all matters.
- To vote by mail, an authorized person should sign below
and return the Card in the envelope provided
- To vote by fax, call 1-212-224-2540
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: X
--------------------------------------------------------------------------------
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. -- EQUITY INDEX FUND
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
THE MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE FOLLOWING:
Vote On Proposals
1. To Elect a Board of Directors:
For Withhold For All
All All Except
1. Kevin M. Kearney [ ] [ ] [ ]
2. Dolores J. Morrissey
3. John T. Sharkey
4. John R. Silber
5. Stanley Shmishkiss
6. Patrick J. Waide, Jr.
----------------------------------------------------------
To withhold authority to vote for a nominee, mark "For All
Except" and write the nominee's number on the line above.
2. To approve amended fundamental investment restrictions to: (a) delete
restrictions that are no longer required to be fundamental due to changes in
state laws or which otherwise need not be fundamental; and (b) revise the
language of those restrictions that are still required to be fundamental:
For All
(Except Any Against Abstain
Noted Below) All All
[ ] [ ] [ ]
Changes Proposed
1. Options and futures
2. Foreign securities
3. Exercise of control
4. Underwriting securities
5. Making short sales
6. Commodities
7. Issuer diversification
8. Voting securities
9. Senior securities
10. Industry concentration
11. Real estate and mortgages
12. Investment company securities
13. Purchasing on margin
14. Borrowing money
15. Lending Fund assets
16. Illiquid securities
17. Oil, gas and mineral interests
------------------------------------------------------------
To vote against any Change, mark "For All (Except Any Noted
Below)" and write the Change's letter on the line above.
For Against Abstain
3. To ratify the Board's selection of Arthur
Andersen LLP as independent accountants [ ] [ ] [ ]
4. To transact any other business before Meeting [ ] [ ] [ ]
---------------------------------------- -----------------------------------
Signature Date Print Name and Title
<PAGE>
MUTUAL OF AMERICA
320 PARK AVENUE
NEW YORK, NEW YORK 10022-6839
BOND FUND
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
320 Park Avenue, New York, New York 10022
Special Meeting of Shareholders--August 24, 2000, 9:30 a.m.
This proxy is solicited on behalf of the Board of Directors of Mutual of America
Institutional Funds, Inc. ("Investment Company"). The undersigned hereby
appoints Patrick A. Burns and Stanley M. Lenkowicz and each of them (with power
of substitution) to attend the Special Meeting of Shareholders, and all
adjournments thereof, and to vote all shares of common stock of the Investment
Company held of record. The Proposals to be voted on are discussed in the Notice
of Special Meeting and Proxy Statement, each dated July , 2000.
If you sign below but leave the Card blank, the Investment Company will vote
your Shares FOR all matters.
- To vote by mail, an authorized person should sign below
and return the Card in the envelope provided
- To vote by fax, call 1-212-224-2540
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: X
--------------------------------------------------------------------------------
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. -- BOND FUND
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
THE MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE FOLLOWING:
Vote On Proposals
1. To Elect a Board of Directors:
For Withhold For All
All All Except
1. Kevin M. Kearney [ ] [ ] [ ]
2. Dolores J. Morrissey
3. John T. Sharkey
4. John R. Silber
5. Stanley Shmishkiss
6. Patrick J. Waide, Jr.
----------------------------------------------------------
To withhold authority to vote for a nominee, mark "For All
Except" and write the nominee's number on the line above.
2. To approve amended fundamental investment restrictions to: (a) delete
restrictions that are no longer required to be fundamental due to changes in
state laws or which otherwise need not be fundamental; and (b) revise the
language of those restrictions that are still required to be fundamental:
For All
(Except Any Against Abstain
Noted Below) All All
[ ] [ ] [ ]
Changes Proposed
1. Options and futures
2. Foreign securities
3. Exercise of control
4. Underwriting securities
5. Making short sales
6. Commodities
7. Issuer diversification
8. Voting securities
9. Senior securities
10. Industry concentration
11. Real estate and mortgages
12. Investment company securities
13. Purchasing on margin
14. Borrowing money
15. Lending Fund assets
16. Illiquid securities
17. Oil, gas and mineral interests
------------------------------------------------------------
To vote against any Change, mark "For All (Except Any Noted
Below)" and write the Change's letter on the line above.
For Against Abstain
3. To ratify the Board's selection of Arthur
Andersen LLP as independent accountants [ ] [ ] [ ]
4. To transact any other business before Meeting [ ] [ ] [ ]
---------------------------------------- -----------------------------------
Signature Date Print Name and Title
<PAGE>
MUTUAL OF AMERICA
320 PARK AVENUE
NEW YORK, NEW YORK 10022-6839
MONEY MARKET FUND
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC.
320 Park Avenue, New York, New York 10022
Special Meeting of Shareholders--August 24, 2000, 9:30 a.m.
This proxy is solicited on behalf of the Board of Directors of Mutual of America
Institutional Funds, Inc. ("Investment Company"). The undersigned hereby
appoints Patrick A. Burns and Stanley M. Lenkowicz and each of them (with power
of substitution) to attend the Special Meeting of Shareholders, and all
adjournments thereof, and to vote all shares of common stock of the Investment
Company held of record. The Proposals to be voted on are discussed in the Notice
of Special Meeting and Proxy Statement, each dated July , 2000.
If you sign below but leave the Card blank, the Investment Company will vote
your Shares FOR all matters.
- To vote by mail, an authorized person should sign below
and return the Card in the envelope provided
- To vote by fax, call 1-212-224-2540
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: X
--------------------------------------------------------------------------------
MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. -- MONEY MARKET FUND
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
THE MUTUAL OF AMERICA INSTITUTIONAL FUNDS, INC. BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE FOLLOWING:
Vote On Proposals
1. To Elect a Board of Directors:
For Withhold For All
All All Except
1. Kevin M. Kearney [ ] [ ] [ ]
2. Dolores J. Morrissey
3. John T. Sharkey
4. John R. Silber
5. Stanley Shmishkiss
6. Patrick J. Waide, Jr.
----------------------------------------------------------
To withhold authority to vote for a nominee, mark "For All
Except" and write the nominee's number on the line above.
2. To approve amended fundamental investment restrictions to: (a) delete
restrictions that are no longer required to be fundamental due to changes in
state laws or which otherwise need not be fundamental; and (b) revise the
language of those restrictions that are still required to be fundamental:
For All
(Except Any Against Abstain
Noted Below) All All
[ ] [ ] [ ]
Changes Proposed
1. Options and futures
2. Foreign securities
3. Exercise of control
4. Underwriting securities
5. Making short sales
6. Commodities
7. Issuer diversification
8. Voting securities
9. Senior securities
10. Industry concentration
11. Real estate and mortgages
12. Investment company securities
13. Purchasing on margin
14. Borrowing money
15. Lending Fund assets
16. Illiquid securities
17. Oil, gas and mineral interests
------------------------------------------------------------
To vote against any Change, mark "For All (Except Any Noted
Below)" and write the Change's letter on the line above.
For Against Abstain
3. To ratify the Board's selection of Arthur
Andersen LLP as independent accountants [ ] [ ] [ ]
4. To transact any other business before Meeting [ ] [ ] [ ]
---------------------------------------- -----------------------------------
Signature Date Print Name and Title
