<PAGE> 1
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
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
FUNDMANAGER PORTFOLIOS
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement)
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> 2
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
April 14, 1998
Dear Shareholder:
I urge you to vote on the important proposals described in the enclosed
proxy material, which is being distributed to shareholders of FundManager
Aggressive Growth Portfolio, FundManager Growth Portfolio, FundManager Growth
with Income Portfolio, FundManager Bond Portfolio, FundManager Managed Total
Return Portfolio and FundManager International Portfolio (the "Portfolios"),
each a series of FundManager Portfolios (the "Trust"), in connection with the
solicitation of proxies by your Board of Trustees for the Special Meeting of
Shareholders to be held on Wednesday, May 20, 1998 at 3:00 p.m., Boston time.
At the Special Meeting, shareholders will be asked to consider and vote on
the following proposals: (1) the approval of a Master Investment Advisory
Contract between the Trust, on behalf of each Portfolio, and Freedom Capital
Management Corporation (Proposal One); and (2) the ratification of the selection
of Ernst & Young LLP as the independent accountants of the Trust (Proposal Two).
The independent non-management Trustees of the Trust have unanimously
approved the proposals described in the enclosed proxy material and recommend
that the shareholders approve them as well. The proposals do not involve any
increase in advisory fees paid by any of the Portfolios, nor do they affect the
investment objectives or policies of any of the Portfolios.
TO VOTE ON THESE PROPOSALS, WE ASK THAT YOU ACT PROMPTLY BY SIGNING AND
RETURNING THE ENCLOSED PROXY CARD TO US AS SOON AS POSSIBLE IN THE ACCOMPANYING
POSTAGE-PAID ENVELOPE. IT IS VERY IMPORTANT THAT WE RECEIVE YOUR CARD SOON, SO
THAT THE NECESSARY QUORUM OF SHAREHOLDERS IS REPRESENTED AT THE MAY 20, 1998
MEETING.
This is your opportunity to voice your opinion on matters that affect your
Portfolio. Your prompt vote will also help to save time and money. If we do not
receive enough votes, we must increase participation with additional mailings.
That's a costly and time consuming process.
If you have any questions before you vote, please contact your Tucker
Anthony or Sutro investment executive or call D.F. King, Inc., a proxy solicita-
<PAGE> 3
tion firm assisting in the proxy process, at 1-800-949-2583. We will be glad to
help you get your vote in quickly.
We appreciate your continued support and look forward to receiving your
votes of approval.
Sincerely,
/s/ Dexter A. Dodge
-----------------------------------
Dexter A. Dodge
Chairman of the Board
<PAGE> 4
FUNDMANAGER AGGRESSIVE GROWTH PORTFOLIO
FUNDMANAGER GROWTH PORTFOLIO
FUNDMANAGER GROWTH WITH INCOME PORTFOLIO
FUNDMANAGER BOND PORTFOLIO
FUNDMANAGER MANAGED TOTAL RETURN PORTFOLIO
FUNDMANAGER INTERNATIONAL PORTFOLIO
EACH A SERIES OF
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
(800) 344-9033
---------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 20, 1998
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
"Meeting") of FundManager Aggressive Growth Portfolio, FundManager Growth
Portfolio, FundManager Growth with Income Portfolio, FundManager Bond Portfolio,
FundManager Managed Total Return Portfolio and FundManager International
Portfolio, each a series of FundManager Portfolios, a Delaware business trust
(the "Trust"), will be held at the principal offices of the Trust, sixth floor,
One Beacon Street, Boston, Massachusetts 02108 on Wednesday, May 20, 1998 at
3:00 p.m., Boston time, and at any adjournment or postponement thereof, for the
purposes listed below. The portfolio series of funds within the Trust are
collectively referred to as the "Portfolios" and individually as a "Portfolio."
The matters to be voted on by the shareholders of the respective Portfolios are
as follows:
1. All Portfolios -- To consider and vote on approval of a Master
Investment Advisory Contract between the Trust, on behalf of each
Portfolio, and Freedom Capital Management Corporation (Proposal One).
2. All Portfolios -- To ratify the selection of Ernst & Young LLP as the
independent auditors of the Trust (Proposal Two).
3. To consider and vote upon such other matters as may properly come before
the Meeting or any adjournment or postponement thereof.
These items are discussed in greater detail in the accompanying Proxy
Statement.
<PAGE> 5
The Board of Trustees has fixed the close of business on March 30, 1998, as
the record date for determination of shareholders who are entitled to notice of
and to vote at the Meeting and any adjournment or postponement thereof.
By order of the Trustees,
/s/ MAUREEN M. RENZI
-------------------------
MAUREEN M. RENZI
Assistant Secretary
Boston, Massachusetts
April 14, 1998
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN. WHETHER OR NOT YOU
EXPECT TO BE PRESENT AT THE MEETING, PLEASE COMPLETE AND SIGN THE ENCLOSED PROXY
CARD(S) AND RETURN IT (THEM) PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH NEEDS NO
POSTAGE IF MAILED IN THE CONTINENTAL UNITED STATES. IF YOU DESIRE TO VOTE IN
PERSON AT THE MEETING, YOUR PROXY MAY BE REVOKED. THIS PROXY IS BEING SOLICITED
BY THE TRUSTEES OF THE TRUST.
<PAGE> 6
FUNDMANAGER AGGRESSIVE GROWTH PORTFOLIO
FUNDMANAGER GROWTH PORTFOLIO
FUNDMANAGER GROWTH WITH INCOME PORTFOLIO
FUNDMANAGER BOND PORTFOLIO
FUNDMANAGER MANAGED TOTAL RETURN PORTFOLIO
FUNDMANAGER INTERNATIONAL PORTFOLIO
EACH A SERIES OF
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
(800) 344-9033
------------------------
PROXY STATEMENT
NOTICE OF SPECIAL MEETINGS OF SHAREHOLDERS
TO BE HELD MAY 20, 1998
SPECIAL MEETING
This Proxy Statement is being furnished to the shareholders of FundManager
Aggressive Growth Portfolio ("Aggressive Growth Portfolio"), FundManager Growth
Portfolio ("Growth Portfolio"), FundManager Growth with Income Portfolio
("Growth with Income Portfolio"), FundManager Bond Portfolio ("Bond Portfolio"),
FundManager Managed Total Return Portfolio ("Managed Total Return Portfolio")
and FundManager International Portfolio ("International Portfolio"), each series
of FundManager Portfolios, a Delaware business trust, which is referred to in
this Proxy Statement as the "Trust." The portfolio series of funds within the
Trust are collectively referred to herein as the "Portfolios" and individually
as a "Portfolio." This Proxy Statement is furnished in connection with the
solicitation of proxies by and on behalf of the Trust's Trustees for use at the
Special Meeting of Shareholders (the "Meeting") to be held at the principal
offices of the Trust, sixth floor, One Beacon Street, Boston, Massachusetts
02108 on Wednesday, May 20, 1998 at 3:00 p.m., Boston time, and at any
adjournment or postponement thereof. This Proxy Statement and the forms of proxy
will be mailed to shareholders of each of the Portfolios on or about April 15,
1998.
1
<PAGE> 7
As more fully described in this Proxy Statement, the Meeting has been
called for the purposes set forth in the table below. This table identifies each
proposal set forth in the Notice of Special Meeting of Shareholders, and the
checkmark (X) indicates which Portfolio's shareholders are being solicited to
approve which proposal:
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH WITH MANAGED TOTAL
GROWTH GROWTH INCOME BOND RETURN INTERNATIONAL
PROPOSAL PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------- ---------- --------- ----------- --------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
1. Approval of New Master
Investment Advisory
Contract (All
Portfolios) X X X X X X
2. Ratification of
Independent Auditors
(All Portfolios) X X X X X X
</TABLE>
The most recent annual reports for the Portfolios have previously been sent
to shareholders and are available upon request, without charge, by writing to
FundManager Portfolios, c/o Federated Services Co., P.O. Box 9043, Boston,
Massachusetts 02205-9840 or calling 1-800-344-9033.
SOLICITATION, REVOCATION AND USE OF PROXIES
HOLDERS OF SHARES OF THE PORTFOLIOS ARE REQUESTED TO COMPLETE, DATE, SIGN
AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE. If the
enclosed proxy is properly executed and returned in time to be voted at the
Meeting, the shares represented thereby will, unless the proxy has previously
been revoked, be voted in accordance with the instructions marked on the proxy.
Unless instructions to the contrary are marked on the proxy, the proxy will be
voted FOR each Proposal, as described in this Proxy Statement and as set forth
in the accompanying Notice of Special Meeting, and in the discretion of the
persons named as proxies in connection with any other matters as may properly
come before the Meeting or any adjournment or postponement of the Meeting. The
Trustees do not know of any matter to be considered at the Meeting other than
the matters referred to in the Notice of Special Meeting.
Proxy solicitations will be made primarily by mail, but proxy solicitations
also may be made by telephone, telegraph or personal interviews conducted by
Trustees and officers of the Trust, by personnel of the Adviser, by personnel of
Tucker Anthony Incorporated, Sutro & Co., Incorporated and Freedom Distributors
Corporation, the Portfolios' distributors, Federated Shareholder Services
Company, the Portfolios' transfer agent, in person or by telephone, and by D.F.
King, Inc., a proxy solicitation firm that has been engaged to assist in proxy
solicitation (the "Solicitor").
Shareholders of the Portfolios may be asked by the Solicitor's
representatives to cast their votes by authorizing the execution of a proxy by
telephone. Shareholders will either be contacted by a representative of the
Solicitor using
2
<PAGE> 8
information derived from a shareholder list provided by the Trust or
shareholders may be sent a written communication or left a telephone message
asking the shareholder to telephone the Solicitor at a designated toll-free
number. In all such cases, the representative of the Solicitor will ask for the
shareholder's full name and address, the last four digits of the shareholder's
social security number or employer identification number, the person's title (in
the case of a corporate shareholder) and confirmation that the person is
authorized to direct the voting of the shares. The shareholder will be asked to
confirm that the Proxy Statement and proxy form have been received. If answered
in the affirmative, the Solicitor representative will advise the shareholder
that the shareholder may authorize the execution of a proxy over the telephone
and ask the shareholder if the shareholder desires to authorize the execution of
a proxy at that time. Telephone conversations will be recorded. If the
shareholder chooses to proceed, the representative of the Solicitor will then
ask the shareholder if the shareholder wishes to support each Proposal. If
answered in the affirmative with respect to a Proposal, the Solicitor will read
the Proposal to the shareholder and ask for such shareholder's voting
instruction on the Proposal.
Although the representative of the Solicitor will assist with any
questions, the answers to which are contained in the Proxy Statement, the
representative of the Solicitor will not make recommendations on how to vote on
the Proposal. Finally, the representative of the Solicitor will explain that the
Solicitor will execute a written proxy as the shareholder's agent in accordance
with the shareholder's instructions and will forward the proxy to the Trust.
Within 72 hours after each telephone call, the Solicitor will send to each
shareholder who used the telephone proxy voting method a written confirmation of
the shareholder's instructions. The shareholder will be asked to contact the
Solicitor immediately if the shareholder's instructions have not been properly
recorded.
If a shareholder wishes to participate in the Meeting, but does not wish to
authorize the execution of a proxy by telephone, the shareholder may still
submit the proxy form included with this Proxy Statement or attend the Meeting
in person.
A shareholder executing and returning a proxy or submitting a telephone
proxy has the power to revoke it at any time before it is exercised by filing
with the Trust a written notice of revocation at the following address: One
Beacon Street, Boston, Massachusetts 02108, Attention: Maureen Renzi, Assistant
Secretary, or returning a duly executed proxy bearing a later date prior to the
time of the Meeting. Any shareholder who has executed a proxy or submitted a
telephone proxy but is present at the Meeting and who wishes to vote in person
may revoke his or her proxy by notifying the Assistant Secretary of the Trust
(without complying with any formalities) at any time before it is voted.
Presence
3
<PAGE> 9
at the Meeting alone will not serve to revoke a previously executed and returned
proxy.
A majority of the shares of a Portfolio entitled to vote at the Meeting
shall be a quorum for the transaction of business by that Portfolio. In the
event a quorum is not present in person or by proxy at the time any session of
the Meeting is called to order, the persons named as proxies may vote those
proxies which have been received to adjourn the Meeting to a later date. In the
event that a quorum is present but sufficient votes in favor of any of the
Proposals have not been received, the persons named as proxies may propose one
or more adjournments of the Meeting to permit further solicitation of proxies
with respect to any of the Proposals. Any such adjournment will require the
affirmative vote of a majority of those shares present in person or by proxy at
the session of the Meeting to be adjourned. A shareholder vote may be taken on
one or more of the Proposals in the Proxy Statement prior to an adjournment if
sufficient votes for its approval have been received and it is otherwise
appropriate.
For purposes of determining the presence or absence of a quorum and for
determining whether sufficient votes have been received for approval of any
matter to be acted upon at the Meeting, abstentions and broker non-votes will be
treated as shares that are present at the Meeting but which have not been voted.
For this reason, abstentions and broker non-votes will assist a Portfolio in
obtaining a quorum but will have the practical effect of a "no" vote for
purposes of obtaining the requisite vote for approval of Proposals One and Two.
RECORD DATE AND OUTSTANDING SHARES
Only shareholders of the Portfolios of record as of the close of business
on March 30, 1998 (the "Record Date") are entitled to receive notice of, and to
vote at, the Meeting and any adjournment or postponement of the Meeting. As of
the close of business on the Record Date, the following number of shares of each
Portfolio were outstanding and entitled to vote:
<TABLE>
<CAPTION>
NUMBER OF
SHARES
PORTFOLIO OUTSTANDING
--------- -----------
<S> <C>
Aggressive Growth Portfolio........... 2,443,504.897
Growth Portfolio...................... 2,552,907.670
Growth with Income Portfolio.......... 2,460,247.936
Bond Portfolio........................ 5,088,734.749
Managed Total Return Portfolio........ 957,511.696
International Portfolio............... 0.000
</TABLE>
The holder of each full share outstanding as of the close of business on
the Record Date is entitled to one vote for each share held of record upon each
4
<PAGE> 10
matter properly submitted to the Meeting or any adjournment or postponement
thereof, with a proportionate vote for each fractional share.
PROXY SOLICITATION EXPENSES
The cost of soliciting proxies, including the fees of D.F. King, Inc.,
which are estimated to cost $7,500, and all expenses incurred by the Portfolios
in connection with the approval of the new Master Investment Advisory Contract
described in Proposal One, including, without limitation, the expenses relating
to the Meeting and to the meetings of the Trustees at which the proposed new
Master Investment Advisory Contract (as described below) was considered, and the
fees and expenses of counsel to the Portfolios and counsel to the Trustees of
the Trust who are not "interested persons" (the "Independent Trustees") (as
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act")) of the Adviser, will be borne by the Adviser and/or by its
parent, Freedom Securities Corporation ("Freedom Securities"), and not by the
Trust. The Adviser and/or Freedom Securities will also reimburse brokerage firms
and others for their expenses in forwarding proxy materials to the beneficial
owners and soliciting them to execute the proxies.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of the close of business on February 28, 1998, no person owned
beneficially or of record 5% or more of the shares of Managed Total Return
Portfolio and International Portfolio. As of the close of business on February
28, 1998, the following persons owned of record or beneficially 5% or more of
the shares of Agressive Growth Portfolio, Growth Portfolio, Growth with Income
Portfolio and Bond Portfolio (percentage is percentage of outstanding shares of
a Portfolio owned by the shareholders):
AGGRESSIVE GROWTH PORTFOLIO
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
Financial Advisor.... Turtle & Co FC1202 530,919.318 22.32%
c/o State Street Bank &
Trust Co
P.O. Box 9242-9242
Boston, MA 02209-9242
Financial Advisor.... Turtle & Co 287,283.986 12.08%
FC-RR
P.O. Box 9427
Boston, MA 02209-9247
</TABLE>
5
<PAGE> 11
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
Financial Advisor.... Charles Schwab & Co Inc 347,647.386 14.61%
Special Custody Account for
the Exclusive Benefit
of Customers
Attn Mutual Funds
101 Montgomery Street
San Francisco, CA
94104-4122
No Load.............. Wexford Clearing Corp FBO 12,690.168 10.31%
Sutro & Co Cust
FBO Helen B. McCall
IRA P/O DTD 9/10/96
513 Rosarita Dr.
Fullerton, CA 92835-1838
No Load.............. Wexford Clearing Services 7,353.786 5.97%
Corp FBO
Mr. John A. Fagone Ttee
Salon D Estiste Inc
Target Benefit Plan
12 Atlantic Ave.
Marblehead, MA 01945-3278
No Load.............. Frank C. Griffin MD TR 7,025.691 5.71%
The Orthopedic Medical
Clinic
Inc Pft Shg Pln U/A
Dated #1
158 Twin Oaks
Los Gatos, CA 95032-5649
GROWTH PORTFOLIO
</TABLE>
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
Financial Advisor.... Turtle & Co FC1202 681,489.309 26.47%
c/o State Street Bank &
Trust Co.
P.O. Box 9241
Boston, MA 02209-9242
Financial Advisor.... Turtle & Co. 522,092.415 20.28%
FC-RR
P.O. Box 9427
Boston, MA 02209-9427
Financial Advisor.... Charles Schwab & Co Inc. 168,605.579 6.55%
Special Custody Account for
the Exclusive Benefit
of Customers
Attn Mutual Funds
101 Montgomery Street
San Francisco, CA
94104-4122
</TABLE>
6
<PAGE> 12
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
No Load.............. Everen Clearing FBO 4,684.271 5.24%
Don Philip Grijalva
111 East Kilbourn Ave.
3rd Fl
Milwaukee, WI 53202-6611
No Load.............. Wexford Clearing Services 5,957.103 6.67%
Corp
Sutro & Co Inc C/F
Helen E McCall IRA R/L
Dtd 09/10/96
513 Rosarita Dr.
Fullerton, CA 92836-1838
No Load.............. Wexford Clearing Services 6,840.147 7.66%
Corp
John A. Fagone Ttee
Salon D Estiste Inc.
Target Benefit Plan
22 Atlantic Avenue
Marblehead, MA 01945-3278
No Load.............. Frank C. Griffin MD TR 6,001.345 6.72%
The Orthopedic Medical
Clinic
Inc Pft Shg Pln U/A
Dated #1
158 Twin Oaks
Los Gatos, CA 95032-5649
GROWTH WITH INCOME PORTFOLIO
</TABLE>
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
Financial Advisor.... Turtle & Co FC1202 701,285.818 28.25%
c/o State Street Bank &
Trust Company
P.O. Box 9242
Boston, MA 02209-9242
Financial Advisor.... Turtle & Co 550,987.423 22.19%
FC-RR
P.O. Box 9427
Boston, MA 02209-9427
No Load.............. Wexford Clearing Services 3,579.765 6.10%
Corp FBO
Sutro & Co Inc C/F
Helen E. McCall
IRA R/O Dtd 09-10-96
513 Rosarita Dr.
Fullerton, CA 92835-1838
No Load.............. Everen Clearing FBO 4,299.361 7.32%
Don Philip Grijalva
111 East Kilbourn Ave.
3rd Fl
Milwaukee, WI 53202-6611
</TABLE>
7
<PAGE> 13
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
No Load.............. Wexford Clearing Services 2,957.951 5.04%
Corp. FBO
Tucker Anthony C/F
Howard J. Sussman IRA R/O
DTD 06-03-96
247 Camelback Ridge Ave.
Henderson, NV 89012-2255
No Load.............. Wexford Clearing Services 3,289.457 5.60%
Corp FBO
Tucker Anthony Inc C/F
Carl F Simone IRA R/O Dtd
10-02-95
4 Brookside Dr.
Colts Neck, NJ 07722-1407
No Load.............. Wexford Clearing Services 2,989.458 5.09%
Corp
Ann J Caswell
7325 W 88th Ave.
Los Angeles, CA 90045
FUNDMANAGER BOND PORTFOLIO
</TABLE>
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
Financial Advisor.... Turtle & Co FC1202 2,227,528.477 45.34%
c/o State Street Bank &
Trust Co
P.O. Box 9242
Boston, MA 02209-9242
Financial Advisor.... Turtle & Co 1,627,441.109 33.13%
FC-RR
P.O. Box 9427
Boston, MA 02209-9427
Financial Advisor.... Charles Schwab & Co Inc 365,195.647 7.43%
Special Custody Account for
the
Exclusive Benefit
of Customers
Attn Mutual Funds
101 Montgomery Street
San Francisco, CA
94104-4122
No Load.............. Wexford Clearing Services 9,864.005 7.76%
Corp. FBO
Tucker Anthony Inc Cust
Carl F Simone IRA R/O
Dtd 10-02-95
4 Brookside Dr.
Colts Neck, NJ 07722-1407
</TABLE>
8
<PAGE> 14
<TABLE>
<CAPTION>
NAME AND AMOUNT AND PERCENT
ADDRESS OF NATURE OF OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ---------------- -------------------- -------
<S> <C> <C> <C>
No Load.............. Wexford Clearing Services 8,868.367 6.98%
Corp FBO
Tucker Anthony Inc Cust
Howard J. Sussman IRA R/O
Dtd 6-3-96
247 Camelback Ridge Ave.
Henderson, NV 89012-2255
No Load.............. Wexford Clearing Services 8,997.736 7.08%
Corp. FBO
Ann J. Caswell
7325 W. 88th Pl.
Los Angeles, CA 90045-3410
No Load.............. Wexford Clearing Services 11,567.141 9.10%
Corp FBO
John A Fagone Ttee
Salon D Estists Inc
Target Benefit Plan
22 Atlantic Avenue
Marblehead, MA 01945-3278
No Load.............. Frank C. Griffin MD TR 11,010.214 8.66%
The Orthopedic Medical
Clinic
Inc Pft Shg Pln U/A Dated
#1
158 Twin Oaks
Los Gatos, CA 95032-5649
</TABLE>
9
<PAGE> 15
SECURITY OWNERSHIP OF TRUSTEES AND EXECUTIVE OFFICERS
As of the close of business February 28, 1998, the following Trustees and
executive officers of the Trust owned beneficially or of record the number
shares of each Portfolio set forth below:
<TABLE>
<CAPTION>
TRUSTEE OR OFFICER AND SHARES OF EACH FUND
OFFICE WITH EACH TRUST BENEFICIALLY OWNED(1)
---------------------- ---------------------
<S> <C>
CHARLES B. LIPSON: Executive Growth Portfolio -- 344.503
Vice President Growth with Income
Portfolio -- 289.176
MICHAEL D. HIRSCH: Executive Aggressive Growth
Vice President Portfolio -- 211.520
Growth Portfolio -- 246.297
Growth with Income
Portfolio -- 520.924
Bond Portfolio -- 2,146.397
CAREY C. CORT: Executive Vice Growth Portfolio -- 245.578
President Growth with Income
Portfolio -- 495.763
KRISTIN K. HOVIOUS: Vice President Growth with Income
Portfolio -- 88.125
PATRICK J. CLARK: Vice President Growth Portfolio -- 189.590
MARTIN S. ORGEL: Vice President Growth with Income
Portfolio -- 163.681
Trustees and executive officers of Aggressive Growth
FundManager Portfolios as a group Portfolio -- 211.520;
(18 persons) Growth Portfolio --
1,025.968; Growth with
Income Portfolio --
1,557.669; Bond
Portfolio -- 2,146.397;
Managed Total Return
Portfolio -- 0; Inter-
national Portfolio -- 0
</TABLE>
- ------------
* These Trustees and/or officers are deemed to be "interested persons" of the
Trusts, as defined in the Investment Company Act, inasmuch as they are
affiliated with the Adviser.
(1) None of the persons listed or the Trustees and executive officers as a group
beneficially owns in excess of 1% of the outstanding shares of any
Portfolio. Except as otherwise indicated, the individual indicated as being
the beneficial owner of such shares has sole voting and investment power
with respect to such shares.
10
<PAGE> 16
PROPOSAL ONE
CONSIDERATION AND APPROVAL OF A NEW MASTER
INVESTMENT ADVISORY CONTRACT BETWEEN THE TRUST,
ON BEHALF OF EACH PORTFOLIO, AND THE ADVISER
The investment adviser for the Trust is Freedom Capital Management
Corporation, a Massachusetts corporation, with offices at One Beacon Street,
Boston, Massachusetts 02108. The Adviser is a registered investment advisory
firm which maintains a securities research department, the efforts of which are
made available to the Portfolios. The Adviser is a wholly-owned indirect
subsidiary of Freedom Securities Corporation, which is a publicly-owned Delaware
corporation. The head offices of Freedom Securities are at One Beacon Street,
Boston, Massachusetts 02108.
Freedom Distributors Corporation ("Freedom Distributors"), Tucker Anthony
Incorporated ("Tucker Anthony") and Sutro & Co., Incorporated ("Sutro"),
affiliates of the Adviser, serve as distributors and principal underwriters for
the Portfolios pursuant to Master Distribution Agreements with the Trust. Tucker
Anthony and Sutro are brokerage firms which are members of the New York Stock
Exchange. Freedom Distributors, Tucker Anthony and Sutro are all subsidiaries of
Freedom Securities. Edgewood Services, Inc. also serves as a distributor and
principal underwriter for the Portfolios pursuant to a Distribution Agreement
with the Portfolios.
THE TRANSACTION
Freedom Securities, the parent of the Adviser, is currently involved in a
series of transactions pursuant to which it has issued, or will in the future
issue, significant numbers of additional shares of its common stock, thereby
diluting the stock ownership of its current shareholders, including the Thomas
Lee Entities (as defined below under "Information about the Adviser"), and
pursuant to which the Thomas Lee Entities have sold shares of Freedom
Securities' stock to the public. Upon the issuance of additional shares of
Freedom Securities' common stock pursuant to one or more of these transactions,
the Thomas Lee Entities will own less than 25% of the outstanding voting
securities of Freedom Securities. In addition, the Stockholders Agreement by and
among the Thomas Lee Entities and certain other shareholders of Freedom
Securities (including employees of the Adviser and its affiliates) with respect
to the exercise of certain voting rights held by such shareholders (the
"Stockholders Agreement") is expected to terminate forty-five days following the
closing of Freedom Securities' public offering of shares described below. As a
result of the occurrence of these events, the Thomas Lee Entities may no longer
be deemed to control Freedom Securities and indirectly the Adviser.
11
<PAGE> 17
As described below, the "Transaction" is the event which causes the Thomas
Lee Entities to no longer be deemed to control Freedom Securities and indirectly
the Adviser; which, in this case, will result from either: the ownership of the
Thomas Lee Entities in the voting securities of Freedom Securities falling below
25% or the termination of the Stockholders Agreement.
These underlying transactions include: (i) an initial public offering of up
to 7,400,000 shares of Freedom Securities' common stock (plus an additional
1,110,000 shares to cover the underwriters' over-allotments) (the "Offering"),
(ii) the acquisition of Cleary Gull Reiland & McDevitt Inc. ("Cleary Gull"), a
regional midwestern investment banking firm, for a combination of stock and cash
(the "Acquisition"), (iii) the granting of options to Cleary Gull employees to
purchase up to 272,700 shares of Freedom Securities' common stock, and (iv) the
implementation of Freedom Securities' 1998 Long-Term Incentive Plan and 1998
Employee Stock Purchase Plan, pursuant to which options to purchase up to
2,291,688 shares and 500,000 shares, respectively, of Freedom Securities' common
stock will be granted to participating employees, in addition to the issuance of
shares pursuant to options to purchase a maximum of 2,133,888 shares of Freedom
Securities' common stock which have been granted to participating employees
pursuant to the 1996 Stock Option Plan. The terms and timing of these
transactions were determined in response to a number of factors beyond the scope
of the Investment Company Act and substantially unrelated to the Portfolios or
the Adviser.
On April 1, 1998, Freedom Securities distributed a prospectus in connection
with an initial public offering of up to 7,400,000 shares of Freedom Securities'
common stock (plus an additional 1,110,000 shares to cover underwriters' over-
allotments). Included in the Offering of shares to the public were 2,241,295
shares of common stock sold by the Thomas Lee Entities as selling shareholders.
Upon completion of the Offering, Freedom Securities had outstanding 19,097,403
shares of its common stock, assuming no exercise of options after December 31,
1997. The Offering was completed on April 7, 1998.
On March 9, 1998, Freedom Securities entered into an Agreement and Plan of
Merger to acquire Cleary Gull, headquartered in Milwaukee, Wisconsin, as part of
its strategy of acquiring firms with complementary businesses to strengthen or
expand Freedom Securities' geographic or product offering base. The
consideration to be paid in the Acquisition will be a combination of shares of
Freedom Securities' common stock valued at $17.6 million and $4.4 million in
cash, subject to adjustment under certain circumstances. In addition, stock
options to purchase shares of Cleary Gull capital stock with a value of
approximately $3.5 million will be converted into options to purchase Freedom
Securities' common stock, and Freedom Securities has agreed to grant new options
to Cleary Gull employees to purchase up to an additional 272,700 shares of
Freedom Securities' common stock at the initial offering price of the shares to
12
<PAGE> 18
the public. The Acquisition is presently expected to be completed on or about
April 17, 1998.
Also in 1998, Freedom Securities implemented a new 1998 Long-Term Incentive
Plan and 1998 Employee Stock Purchase Plan, which authorizes the issuance of a
maximum of 2,291,688 shares and 500,000 shares, respectively, of Freedom
Securities' common stock pursuant to the exercise of nontransferable options
granted to participating employees. The 1998 Plans are in addition to the 1996
Stock Option Plan, pursuant to which Freedom Securities has granted options to
purchase a maximum of 2,133,888 shares of its common stock.
After giving effect to the Offering, the Thomas Lee Entities own
approximately 5,018,197 shares of Freedom Securities' common stock, or 26.3% of
the outstanding voting shares of Freedom Securities and indirectly the Adviser.
Upon the issuance of additional shares of Freedom Securities' common stock
pursuant to one or more of the underlying transactions described above, the
Thomas Lee Entities may own less than 25% of the outstanding voting securities
of Freedom Securities and, as a result, may no longer be deemed to control
Freedom Securities.
In addition, the Thomas Lee Entities may no longer be deemed to control
Freedom Securities upon the termination of the voting provisions of the
Stockholders Agreement. The Thomas Lee Entities are parties to a Stockholders
Agreement with certain other shareholders of Freedom Securities, with respect to
the exercise of certain voting rights held by such shareholders, including,
among other things, an agreement of such parties to vote their shares in favor
of fixing the number of directors of Freedom Securities at nine and electing
four individuals designated by the Thomas Lee Entities as directors of Freedom
Securities. The voting agreement contained in the Stockholders Agreement is
expected to terminate on the forty-fifth day following the closing of the
Offering.
The order in which the foregoing events will occur is uncertain. The
Transaction is expected to take place, assuming the conditions to the closing of
the Acquisition are satisfied or waived, some time in May 1998. If the
Transaction occurs and if shareholders of the Portfolios approve the proposed
new Master Investment Advisory Contract (the "New Master Investment Advisory
Contract") with the Adviser, the Adviser will continue the investment advisory
functions it currently performs. If the Transaction does not occur for any
reason, the Portfolios' existing Master Investment Advisory Contract (as defined
below under "Existing Master Investment Advisory Contract") with the Adviser
will remain in place.
Change of Control and Exemptive Order Application. Section 15(a) of the
Investment Company Act provides, in pertinent part, that it shall be unlawful
for any person to serve or act as investment adviser of a registered investment
13
<PAGE> 19
company, except pursuant to a written contract that has been approved by the
vote of a majority of the outstanding voting securities of such registered
investment company. Section 15(a) further requires that such written contract
provide for automatic termination in the event of its assignment. As required by
the Investment Company Act, the Existing Master Investment Advisory Contract
pursuant to which the Adviser provides investment advisory services to the
Portfolios provides for its automatic termination upon its "assignment."
Section 2(a)(4) of the Investment Company Act defines "assignment" to
include any direct or indirect transfer of a contract by the assignor, or of a
controlling block of the assignor's outstanding voting securities by a security
holder of the assignor. Section 2(a)(9) of the Investment Company Act defines
"control" to mean the power to exercise a controlling influence over the
management or policies of a company and establishes a presumption that the
beneficial owner of more than 25% of the voting securities of a company controls
that company.
Rule 15a-4 provides, among other things, that if an investment advisory
contract with an investment company is terminated by assignment, the adviser may
continue to act as such for 120 days under a written contract that has not been
approved by the investment company's shareholders, if the new contract is
approved by the board of directors (or trustees) of the investment company
(including a majority of trustees that are not "interested persons" of the
investment company), the compensation to be paid under the new contract does not
exceed the compensation which would have been paid under the contract most
recently approved by shareholders of the investment company, and neither the
investment adviser nor any controlling person of the investment adviser
"directly or indirectly receives money or other benefit" in connection with the
assignment.
As discussed above, upon the occurrence of the Transaction, the Thomas Lee
Entities may no longer be deemed to "control" Freedom Securities, and an
indirect change in control of the Adviser may be deemed to have occurred. The
Transaction thus may be deemed to result in an indirect "assignment" of the
Existing Master Investment Advisory Contract within the meaning of Section
2(a)(4) and a termination of the Existing Master Investment Advisory Contract
according to its terms. In addition, the Applicants may not conclusively rely on
Rule 15a-4 because Freedom Securities or the Thomas Lee Entities may be deemed
to receive a benefit in connection with the Transaction. As a consequence of the
termination of the Existing Master Investment Advisory Contract, shareholder
approval of the New Master Investment Advisory Contract will be required.
In addition, upon the occurrence of the Transaction, Freedom Distributors,
Tucker Anthony and Sutro, which are also subsidiaries of Freedom Securities
14
<PAGE> 20
and affiliates of the Adviser, would also undergo an indirect change of control
similar to the Adviser, giving rise to the "assignment" of the Portfolios'
current distribution agreements with these distributors within the meaning of
the Investment Company Act, necessitating Trustee approval of new distribution
agreements. The Trustees of the Trusts approved new distribution agreements with
the Portfolios' distributors on March 30, 1998 in anticipation of the
Transaction.
With respect to the Existing Master Investment Advisory Contract, the
Trusts on behalf of the Portfolios and the Adviser (together with the Trusts,
the "Applicants"), applied pursuant to Section 6(c) of the Investment Company
Act, for an order of the Securities and Exchange Commission (the "SEC") to
provide the Applicants an exemption from Section 15(a) of the Investment Company
Act (the "Exemptive Order"). Section 15(a) of the Investment Company Act
generally requires the shareholders to approve a new investment advisory
agreement.
The requested exemption would permit the implementation, prior to formal
shareholder approval, of the New Master Investment Advisory Contract described
below, which is substantially identical to the Existing Master Investment
Advisory Contract, between the Trust and the Adviser with respect to each
Portfolio. The requested exemption would cover an interim period of not more
than 150 days (the "Interim Period") beginning on the date of the Transaction
and continuing through the date the New Master Investment Advisory Contract is
approved or disapproved by the shareholders of the respective Portfolios
pursuant to this proxy, but in no event later than October 31, 1998. For each
Portfolio, the aggregate contractual rate chargeable for investment advisory
services will remain the same. During the Interim Period, fees payable by the
Portfolios for such investment advisory services will be paid into escrow.
Under the Exemptive Order, the Applicants proposed to enter into an escrow
arrangement with an unaffiliated financial institution that will serve as escrow
agent. The arrangement, in substance, will provide that the fees payable to the
Adviser during the Interim Period under the New Master Investment Advisory
Contract will be paid into an interest-bearing escrow account maintained by the
escrow agent and that the amounts in the escrow account with respect to each
Portfolio (including interest earned on such paid fees) will be paid to the
Adviser only if shareholders of the Portfolio approve the New Master Investment
Advisory Contract. If shareholders of a Portfolio fail to approve the New Master
Investment Advisory Contract, the escrow agent will pay that Portfolio its
respective share of the escrow amounts (including any interest earned).
Compliance with Section 15(f) of the Investment Company Act. Section 15(f)
of the Investment Company Act provides that when a change in
15
<PAGE> 21
control of an investment adviser occurs, the investment adviser or any of its
affiliated persons may receive any amount or benefit in connection therewith as
long as two conditions are satisfied.
First, no unfair burden may be imposed on the investment company as a
result of the transaction relating to the change of control or any express or
implied terms, conditions or understandings, applicable thereto. The term
"unfair burden," as defined in the Investment Company Act, includes any
arrangement during the two-year period after the change in control whereby the
investment adviser (or predecessor or successor adviser), or any interested
person of any such adviser, receive or is entitled to receive any compensation,
directly or indirectly from the investment company or its security holders
(other than fees for bona fide investment advisory or other services) or from
any person in connection with the purchase or sale of securities or other
property to, from, or on behalf of the investment company (other than fees for
bona fide principal underwriting services). No such compensation arrangements
are contemplated in the Transaction. The Adviser, Freedom Securities and the
Thomas Lee Entities have each represented to the Board of Trustees of the Trust
that they will use their best efforts to ensure that the Transaction will not
cause the imposition of an unfair burden on any of the Portfolios.
The second condition is that during the three-year period immediately
following consummation of the Transaction, at least 75% of the investment
company's board of trustees must not be "interested persons" of the investment
adviser or predecessor investment adviser within the meaning of the Investment
Company Act. The Adviser, Freedom Securities and the Thomas Lee Entities have
each represented to the Trustees of the Trust that they will use their best
efforts to ensure that the second condition is met. The current composition of
the Trustees of the Trust meets this condition of Section 15(f).
EXISTING MASTER INVESTMENT ADVISORY CONTRACT
Pursuant to a master investment advisory contract dated as of November 29,
1996 (the "Existing Master Investment Advisory Contract") between the Trust and
the Adviser, the Adviser agreed to act as investment adviser and manager to the
Portfolios. As manager and investment adviser, the Adviser has: (a) furnished
continuously an investment program for the Portfolios and determined, subject to
the overall supervision and review of the Trustees, which investments should be
purchased held, sold or exchanged; (b) provided supervision over all aspects of
the Portfolios' operations except those which are delegated to a custodian,
transfer agent or other agent; and (c) provided the Trust with such executive,
administrative and clerical personnel, offices and equipment as are deemed
necessary for the conduct of the business of the Portfolios.
16
<PAGE> 22
Each Portfolio bears all costs of its organization and operation,
including: expenses of preparing printing and mailing all shareholders' reports,
notices, prospectuses (except that the expense of printing and mailing
prospectuses used for promotional purposes will not be borne by the Portfolios),
proxy statements and reports to regulatory agencies; expenses relating to the
issuance, registration and qualification of shares of the Trust; government
fees; interest charges; expenses of furnishing to shareholders their account
statements; taxes; expenses of redeeming shares; brokerage and other expenses
connected with the execution of portfolio securities sales; fees and expenses of
the Trust's custodian, including those for keeping books and accounts and
calculating the net asset value of shares of each Portfolio; fees and expenses
of its independent auditors, legal counsel, transfer agent and dividend
disbursing agent; the compensation and expenses of its officers, Trustees and
employees; expenses of Trustees' and shareholders' meetings; insurance premiums;
and any extraordinary expenses.
The continuation of the Existing Master Investment Advisory Contract was
last approved on May 20, 1997 by all of the Trustees including all of the
Trustees who are not parties to that Existing Master Investment Advisory
Contract or "interested persons" (as defined in the Investment Company Act) of
any such party and was approved on December 16, 1996 by the then outstanding
shareholders of each of the Portfolios, other than the International Portfolio
which became effective on January 31, 1998. Such shareholder approval was sought
to approve a new investment advisory agreement following an indirect change of
control of the Adviser. The Existing Master Investment Advisory Contract will
continue in effect with respect to each Portfolio from year to year, provided
that its continuance is approved annually both (i) by the holders of a majority
of the outstanding voting securities of each Portfolio or by the Board of
Trustees, and (ii) by a majority of the Trustees who are not parties to the
Existing Master Investment Advisory Contracts or "interested persons" (as
defined in the Investment Company Act) of any such party. The Existing Master
Investment Advisory Contract may be terminated on 60 days' written notice by
either party and will terminate automatically if it is assigned.
Each of the Portfolios pays the Adviser a monthly advisory fee in an amount
equal, on an annual basis, to .50% of each Portfolio's average daily net assets
up to and including $500,000,000 and .40% of each Portfolio's average daily net
assets in excess of $500,000,000.
For the fiscal year ended September 30, 1997, Aggressive Growth Portfolio,
Growth Portfolio, Growth with Income Portfolio, Bond Portfolio and Managed Total
Return Portfolio paid the Adviser Investment Advisory fees of $200,484,
$154,313, $167,415, $340,908 and $58,530, respectively. The International
Portfolio did not become effective until January 31, 1998.
17
<PAGE> 23
NEW MASTER INVESTMENT ADVISORY CONTRACT
If the proposed New Master Investment Advisory Contract is approved by the
shareholders of the Portfolios to which the respective agreements relate, the
Adviser will continue to serve as investment adviser to each Portfolio. The
terms and conditions of the proposed New Master Investment Advisory Contract are
substantially identical to those of the Existing Master Investment Advisory
Contract.
The proposed New Master Investment Advisory Contract, if approved, will
continue in effect for a two year period following the later to occur of (i)
such approval by the relevant Portfolio's shareholders, or (ii) the consummation
of the Transaction; provided, that, if exemptive relief is granted by the SEC,
the New Master Investment Advisory Contract will become effective upon the
consummation of the Transaction, even if that is prior to the approval of the
New Master Investment Advisory Contract by the shareholders of the Portfolios.
Subsequently, the proposed New Master Investment Advisory Contract will be
subject to annual approval by the Trustees and by the Trustees who are not
"interested persons" (as defined in the Investment Company Act) of the Adviser
or the Trust (the "Independent Trustees"), or to approval by the relevant
Portfolio's shareholders. The proposed New Master Investment Advisory Contract
may be terminated as to any Portfolio, without penalty, by the Trustees or by
the shareholders of the relevant Portfolio upon 60 days' written notice to the
Adviser or by the Adviser upon 60 days' written notice to the Portfolio. The
proposed New Master Investment Advisory Contract will terminate automatically in
the event of its "assignment," as defined in the Investment Company Act.
If the proposed New Master Investment Advisory Contract is approved, as
manager and investment adviser, the Adviser will: (a) furnish continuously an
investment program for the Portfolios and determine, subject to the overall
supervision and review of the Trustees, which investments should be purchased,
held, sold or exchanged; (b) provide supervision over all aspects of the
Portfolios' operations except those which are delegated to a custodian, transfer
agent or other agent; and (c) provide the Trust with such executive,
administrative and clerical personnel, offices and equipment as are deemed
necessary for the conduct of the business of the Portfolios.
If the proposed New Master Investment Advisory Contract is approved, each
Portfolio will bear all costs of its organization and operation, including
expenses of: preparing, printing and mailing all shareholders' reports, notices,
prospectuses (except that the expense of printing and mailing prospectuses used
for promotional purposes will not be borne by the Portfolios), proxy statements
and reports to regulatory agencies; expenses relating to the issuance,
registration and qualification of shares of the Trust; government fees; interest
charges; expenses of furnishing to shareholders their account statements; taxes;
expenses
18
<PAGE> 24
of redeeming shares; brokerage and other expenses connected with the execution
of portfolio securities transactions; fees and expenses of the Trust's
custodian, including those for keeping books and accounts and calculating the
net asset value of shares of each Portfolio; fees and expenses of its
independent auditors, legal counsel, transfer agent and dividend disbursing
agent; the compensation and expenses of its Trustees, officers and employees;
expenses of Trustees' and shareholders' meetings; insurance premiums; and any
extraordinary expenses.
If the proposed New Master Investment Advisory Contract is approved, each
of the Portfolios will pay the Adviser a monthly advisory fee in an amount
equal, on an annual basis, to .50% of each Portfolio's average daily net assets
up to and including $500,000,000 and .40% of each Portfolio's average daily net
assets in excess of $500,000,000, which is identical to the fees paid to the
Adviser under the Existing Master Investment Advisory Contract.
If the New Master Investment Advisory Contract is not approved by the
shareholders of a Portfolio, the Trustees will make other investment advisory
arrangements which, in their judgment, would be in the best interest of such
Portfolio and its shareholders until such time as such Portfolio's shareholders
approve a new investment advisory agreement.
INFORMATION ABOUT THE ADVISER
Information Concerning Parent of the Adviser. The adviser is a wholly-
owed subsidiary of Freedom Securities, a publicly-owned Delaware corporation.
Thomas H. Lee Equity Fund III, L.P., Thomas H. Lee Foreign Fund III, L.P. and
THL-CCI, L.P. (the "Thomas Lee Entities") currently own 26.3% of the outstanding
shares of common stock of Freedom Securities. Thomas H. Lee Equity Fund III,
L.P. and Thomas H. Lee Foreign Fund III, L.P. are each Delaware limited
partnerships. The general partner of Thomas H. Lee Equity Fund III, L.P. and
Thomas H. Lee Foreign Fund III, L.P. is THL Equity Advisors III Limited
Partnership, a Massachusetts limited partnership. The general partner of THL
Equity Advisors III Limited Partnership is THL Equity Trust III, a Massachusetts
business trust. The sole beneficial owner of THL Equity Trust III is Thomas Lee.
THL-CCI Limited Partnership is a Massachusetts limited partnership. Its general
partner, THL Investment Management Corp., is a Massachusetts corporation. The
address of Thomas H. Lee Equity Fund III, L.P., Thomas H. Lee Foreign Fund III,
L.P., THL Equity Advisors III Limited Partnership, THL Equity Trust III,
THL-CCI, L.P. and THL Investment Management Corp. is 75 State Street, Boston,
Massachusetts 02109.
19
<PAGE> 25
Information Concerning Directors, Executive Officers and Certain Employees
of the Adviser. The names, principal occupations and position with the Trust of
the directors, executive officers and certain employees of the Adviser are set
forth below. The business address of each person listed below is One Beacon
Street, Boston, Massachusetts 02108, except that the business address for Mr.
Lipson is One World Financial Center, New York, NY 10281.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
POSITION OTHER BUSINESS EXPERIENCE POSITION WITH
NAME WITH ADVISER WITHIN LAST TWO YEARS THE TRUSTS
---- ------------ ------------------------- -------------
<S> <C> <C> <C>
Dexter A. Dodge Chairman of the Director of the Adviser; Chairman of
Board Director of Freedom the Board and
Distributors Trustee
Henry M. Greenleaf President, Chief President, Chief Executive --
Executive Officer Officer and Director of
and Director the Adviser since 1997;
Vice President and
Senior Portfolio Manager
of The Glenmede Trust
Company from 1995 to
1997
John J. Danello Executive Vice President and Director of President
President, Freedom Distributors
General Counsel,
Clerk and
Director
John H. Goldsmith Director Chairman & CEO, Freedom --
Securities; Chairman and
CEO of Tucker Anthony
William C. Dennis Director Director of the Adviser --
Michael M. Spencer Director Director of the Adviser; --
Chief Executive Officer,
Chief Investment Officer
and Director of Fixed
Income for Freedom
Partners Management
Division of the Adviser
Charles B. Lipson Senior Vice Chief Administrative Executive Vice
President, Officer, FundManager President
FundManager Division of the Adviser
Division of the
Adviser
Michael D. Hirsch Chief Investment Chief Investment Officer, Executive Vice
Officer, FundManager Division of President and
FundManager the Adviser Portfolio
Division of the Manager
Adviser
Carey C. Cort Senior Vice Senior Vice President, Executive Vice
President, FundManager Division of President
FundManager the Adviser
Division of the
Adviser
Patrick J. Clark Vice President, Vice President, Vice President
FundManager FundManager Division of
Division of the the Adviser
Adviser
</TABLE>
20
<PAGE> 26
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
POSITION OTHER BUSINESS EXPERIENCE POSITION WITH
NAME WITH ADVISER WITHIN LAST TWO YEARS THE TRUSTS
---- ------------ ------------------------- -------------
<S> <C> <C> <C>
Kristin K. Hovious Vice President, Vice President, Vice President
FundManager FundManager Division of
Division of the the Adviser
Adviser
Martin S. Orgel Assistant Vice Assistant Vice President, Vice President
President, FundManager Division of
FundManager the Adviser
Division of the
Adviser
Maureen M. Renzi Vice President Vice President of the Assistant
Adviser Secretary
</TABLE>
Transactions with Affiliated Brokers. The Trust is a fund of funds and
invests its assets in other registered investment companies ("Underlying Funds")
selected by the Adviser. Many of the Underlying Funds have adopted 12b-1 and/or
service plans pursuant to which payments of up to 75 basis points per year are
made to the broker selling the shares of the Underlying Funds. Also, the
distributor of the shares of the Underlying Funds may pay concessions to the
broker selling the shares of the Underlying Funds.
Freedom Distributors currently executes portfolio transactions, arranges
letters of intent, confirms the trades, assures prompt payment and settlement
and coordinates such transactions with the custodian and other relevant parties,
and performs other brokerage services on behalf of the Portfolios. In connection
therewith, Freedom Distributors receives and retains payments made pursuant to
the 12b-1 and/or service plans and any concessions paid by the distributor of
the shares of the Underlying Funds. For the fiscal year ended September 30,
1997, $200,000 in brokerage commissions were paid to Freedom Distributors as a
result of these transactions. No brokerage commissions were paid to any other
broker that is (i) an "affiliated" person of the Trust, as defined in the
Investment Company Act; (ii) an affiliated person of such person; or (iii) an
affiliated person of which is an affiliated person of the Trust, its principal
underwriter, its investment adviser, or its administrator.
CONSIDERATION BY THE TRUSTEES
The Trustees of the Trust, including the Independent Trustees, have
approved the New Master Investment Advisory Contract on behalf of each Portfolio
and recommend that the New Master Investment Advisory Contract be approved by
shareholders of the Portfolios.
The Independent Trustees met separately and together with the full Board
two times, on March 17 and March 30, 1998, to discuss the proposals contained
herein. In the course of their review, the Trustees, including the Independent
Trustees, requested information of the Adviser, Freedom Securities and the
21
<PAGE> 27
Thomas Lee Entities and reviewed the information provided by them. The
Independent Trustees also retained special counsel to assist them in the review
of the Transaction and its anticipated effects upon the Portfolios and their
shareholders.
The Trustees of the Trust, including the Independent Trustees, considered,
among other things, the structure of the Transaction and the representations of
the Adviser, with respect to the Portfolios. In particular, the Trustees noted
the parties' agreements to use their best efforts to assure that (x) no unfair
burden would be imposed on the Portfolios as a result of the Transaction and (y)
during the three-year period following consummation of the Transaction, at least
75% of each Trust's Board of Trustees will not be "interested persons" (prior to
or after the Transaction) within the meaning of the Investment Company Act. The
Trustees also relied upon representations of the Adviser, Freedom Securities and
the Thomas Lee Entities that (i) no changes in the operation of the Trusts are
contemplated as a result of the Transaction, (ii) there is no present intention
to propose any increase in the rate of fees paid by the Trust to the Adviser,
and (iii) no changes in the management of the Adviser are presently contemplated
as a result of the Transaction.
The Trustees of the Trust, including the Independent Trustees, further
considered whether the Transaction could enhance the investment advisory
operations of the Adviser and the level and quality of services provided to the
Portfolios and their shareholders, as well as the commitments provided by the
Adviser, Freedom Securities and the Thomas Lee Entities that substantially the
same personnel at the Adviser who now provide advisory services to the
Portfolios would continue to do so after the Transaction.
The Trustees of the Trust, including the Independent Trustees, also
considered the fact that the advisory fees would remain the same under the New
Master Investment Advisory Contract as under the Existing Master Investment
Advisory Contract and the fact that the terms of the New Master Investment
Advisory Contract do not substantially differ from those of the Existing Master
Investment Advisory Contract. The Trustees also relied on the representations of
the Adviser, Freedom Securities and the Thomas Lee Entities that the Portfolios
and their shareholders would not bear any fees or expenses in connection with
the approval of the New Master Investment Advisory Contract. In addition, the
Trustees considered, based on the data available to them, the Adviser's
historical profitability with respect to its management of the Portfolios as
well as its reasonably anticipated profitability after the Transaction. The
Trustees also considered that the New Master Investment Advisory Contract
provided that it may be terminated by the shareholders of the relevant Portfolio
and by the Trustees without the payment of any penalty by such Portfolio.
22
<PAGE> 28
In addition, the Trustees considered during the course of their due
diligence process (i) the history, reputation, qualifications and background of
the Adviser, as well as the qualifications of its personnel, (ii) the Adviser's
investment performance record with respect to the Portfolios, and (iii) the
benefits, if any, expected to be realized as a result of the Transaction.
After considering these and other factors, the Trustees of the Trust,
including the Independent Trustees, at a meeting held in person on March 30,
1998, unanimously approved the proposed New Master Investment Advisory Contract
with the Adviser and recommended its approval to the shareholders of the
Portfolios.
THE TRUSTEES OF THE TRUST, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND
THAT THE SHAREHOLDERS OF EACH PORTFOLIO VOTE FOR PROPOSAL ONE, THE APPROVAL OF
THE NEW MASTER INVESTMENT ADVISORY CONTRACT FOR THEIR RESPECTIVE PORTFOLIO.
REQUIRED VOTE
Approval of the New Master Investment Advisory Contract between the Trust,
on behalf of a Portfolio, and the Adviser requires the affirmative vote of a
majority of the outstanding shares of each Portfolio, voting separately as a
Portfolio. Under the Investment Company Act, this means that, to be approved by
a Portfolio, this Proposal must receive the affirmative vote of holders of the
lesser of either (a) 67% or more of the outstanding shares of the applicable
Portfolio, voting as a single class, present at the Meeting, if the holders of
more than 50% of the outstanding shares of the Portfolio are present or
represented by proxy, or (b) more than 50% of the outstanding shares of the
applicable Portfolio, voting as a single class.
PROPOSAL TWO
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Trustees of the Trust, including the Independent Trustees, have
selected Ernst & Young LLP, 200 Clarendon Street, Boston, MA 02110, as the
independent auditors for the fiscal year ended September 30, 1998 with respect
to the Trust. At the Meeting, shareholders of the Trust are being asked to
ratify the selection of Ernst & Young LLP to perform audit services for the
Trust.
Ernst & Young LLP, which has no direct or indirect material financial
interest in the Trust, has served as the Trust's independent auditors since
1992. The services provided by Ernst & Young LLP consist of (1) examination of
the Trust's annual financial statements, (2) assistance and consultation in
connection with Securities and Exchange Commission filings, and (3) review of
the annual income tax returns filed on behalf of the Trust.
23
<PAGE> 29
If the Trust receives a written request from any shareholder at least five
days prior to the Meeting stating that the shareholder will be present in person
at the Meeting and desires to ask questions of the independent auditors, the
Trust will arrange to have a representative of Ernst & Young LLP present at the
Meeting to respond to such questions.
CONSIDERATION BY THE TRUSTEES
THE TRUSTEES OF THE TRUST, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND
THAT SHAREHOLDERS OF THE TRUST VOTE FOR PROPOSAL TWO, THE RATIFICATION OF THE
SELECTION OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS OF THE TRUST.
REQUIRED VOTE
Ratification of the selection of Ernst & Young LLP as the independent
auditors of the Trust requires the affirmative vote of a majority of the
outstanding shares of the Trust. Under the Investment Company Act, this means
that, to be approved by the Trust, this Proposal must receive the affirmative
vote of the lesser of (1) more than 50% of the outstanding shares of the Trust,
voting as a single class, or (2) 67% or more of the outstanding shares of the
Trust, voting as a single class, present at the Meeting, if the holders of more
than 50% of the outstanding shares of the Trust are present or represented by
proxy.
OTHER MATTERS
The Board of Trustees does not know of any other matters that will be
presented for action at the Meetings. If other matters are presented, proxies
will be voted in accordance with the best judgment of the proxy holders.
SHAREHOLDER PROPOSALS
Under the Trust's Agreement and Declaration of Trust, no annual or special
meetings of shareholders are required. Any shareholder desiring to present a
proposal for consideration at the next meeting of shareholders of one or more of
the Portfolios should submit the proposal in writing so that it is received by
the Assistant Secretary of the Portfolios at One Beacon Street, Boston,
Massachusetts 02108 within a reasonable time before the meeting.
ADDITIONAL INFORMATION
The principal distributors and underwriters for all of the Portfolios are
Tucker Anthony, Incorporated, which is located at One World Financial Center,
New York, NY 10281, Sutro & Co., Incorporated, which is located at 201
California Street, San Francisco, California 94111, Freedom Distributors Corpo-
24
<PAGE> 30
ration, which is located at One Beacon Street, Boston, Massachusetts 02108, and
Edgewood Services, Inc., which is located at 5800 Corporate Drive, Pittsburgh,
Pennsylvania 15237. The Transfer and Shareholder Services Agent for all of the
Portfolios is Federated Shareholder Services Company, which is located at P.O.
Box 8639, Boston, Massachusetts 02266-8609.
The information contained in this Proxy Statement regarding Freedom
Securities and the Thomas Lee Entities and the terms of the Transaction was
provided by Freedom Securities and the Thomas Lee Entities.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE URGED TO FILL IN,
DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY.
25
<PAGE> 31
[This Page Intentionally Left Blank]
<PAGE> 32
EXHIBIT A
MASTER INVESTMENT ADVISORY CONTRACT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end investment company organized as a
Delaware business trust and consists of one or more separate investment
portfolios as may be established and designated by the Trust's Board of
Trustees (the "Board of Trustees") from time to time. This Contract shall
pertain only to such portfolios of the Trust as shall be designated in
Supplements to this Contract as further agreed between the Trust and the
Adviser (the "Portfolios"). A separate series of shares of beneficial
interest in the Trust is offered to investors with respect to each
Portfolio. The Trust engages in the business of investing and reinvesting
the assets of each Portfolio in the manner and in accordance with the
investment objectives and restrictions specified in the currently effective
prospectus (the "Prospectus") relating to the Trust and the Portfolios
included in the company's Registration Statement, as amended from time to
time, filed by the Trust under the Investment Company Act of 1940, as
amended (the "1940 Act") and the Securities Act of 1933. Copies of the
documents referred to in the preceding sentence have been furnished to the
Adviser. Any amendments to those documents shall be furnished to the
Adviser promptly. Pursuant to Master Distribution Contracts and Supplements
thereto between the Trust and each of Tucker Anthony Incorporated, Sutro &
Co., Incorporated, Freedom Distributors Corporation and Edgewood Services,
Inc. (the "Distributors"), the Trust has employed the Distributors to act
as principal underwriters for each Portfolio pursuant to a Master
Administrative Services Contract and Supplements thereto between the Trust
and Federated Services (the "Administrator"). The Trust has employed the
Administrator to provide to the Trust management and other services.
A-1
<PAGE> 33
2. The Trust hereby appoints the Adviser to provide to the Portfolios
the investment advisory services specified in this Contract and the Adviser
hereby accepts such appointment.
3. (a) The Adviser shall, at its expense, (i) employ or associate
with itself such persons as it believes appropriate to assist it in
performing its obligations under this Contract and (ii) provide all
services, equipment and facilities necessary to perform its obligations
under this Contract.
(b) The Trust shall be responsible for all of their expenses and
liabilities, including compensation of Trustees who are not affiliated
with the Distributors or any of their affiliates; taxes and governmental
fees; interest charges; fees and expenses of the Trust's independent
auditors and legal counsel; trade association membership dues; fees and
expenses of any custodian (including maintenance of books and accounts
and calculation of the net asset value of shares of the Portfolios),
transfer agent, registrar and dividend disbursing agent of the Trust;
expenses of issuing, selling, redeeming, registering and qualifying for
Sale shares of beneficial interest in the Trust; expenses of preparing
and printing share certificates, and preparing, printing and mailing
prospectuses and reports to shareholders, notices, proxy statements
(other than the proxy statement prepared for the shareholders meeting
convened to consider this agreement (the "initial meeting")) and reports
to regulatory agencies; and cost of office supplies, including
stationery; travel expenses of all officers, Trustees and employees;
insurance premiums; brokerage and other expenses of executing portfolio
transactions; expenses of shareholders' meetings, other than the initial
meeting; organization expenses; and extraordinary expenses.
4. (a) The Adviser shall provide to the Trust investment guidance and
policy direction in connection with the management of the portfolio of each
Portfolio, including oral and written research, analysis, advice,
statistical and economic data and information and judgments of both a
macroeconomic and microeconomic character.
The Adviser will determine the securities to be purchased or sold
by each Portfolio and will place orders pursuant to its determinations
either directly with the issuer or with any broker or dealer who deals
in such securities. The Adviser will determine what portion of each
Portfolio's portfolio shall be invested in securities described by the
policies of such Portfolio and what portion, if any, should be invested
otherwise or held uninvested.
The Trust will have the benefit of the investment analysis and
research, the review of current economic conditions and trends and the
A-2
<PAGE> 34
consideration of long-range investment policy generally available to
investment advisory customers of the Adviser. It is understood that the
Adviser will not use any non-public information pertinent to investment
decisions undertaken in connection with this Contract that may be in its
possession or in the possession of any of its affiliates nor will the
Adviser seek to obtain any such information.
(b) The Adviser also shall provide to the Trust's officers
administrative assistance in connection with the operation of the Trust and
each of the Portfolios, which shall include (i) compliance with all
reasonable requests of the Trust for information, including information
required in connection with the Trust's filings with the Securities and
Exchange Commission and state securities commissions and (ii) such other
services as the Advisers shall from time to time determine, upon
consultation with the Administrator, to be necessary to useful to the
administration of the Trust and each of the Portfolios.
(c) As manager of the assets of each Portfolio, the Adviser shall make
investments for the account of each Portfolio in accordance with the
Adviser's best judgment and within the investment objectives and
restrictions set forth in the Prospectus, the 1940 Act and the provisions
of the Internal Revenue Code of 1986 relating to regulated investment
companies subject to policy decisions adopted by the Board of Trustees.
(d) The Adviser shall furnish to the Board periodic reports on the
investment performance of each Portfolio and on the performance of its
obligations under this Contract and shall supply such additional reports
and information as the Trust's officers or Board of Trustees shall
reasonably request.
(e) On occasions when the Adviser deems the purchase or sale of a
security to be in the best interest of a Portfolio as well as other
customers, the Adviser, to the extent permitted by applicable law, may
aggregate the securities to be so sold or purchased in order to obtain the
best execution or lower brokerage commissions, if any. The Adviser may also
on occasions purchase or sell a particular security for one or more
customers in different amounts. On either occasion, and to the extent
permitted by applicable law and regulations, allocation of the securities
so purchased or sold, as well as the expenses incurred in the will be made
by the Adviser in the manner it considers to be the most equitable and
consistent with its fiduciary obligations to that Portfolio and to such
other customers.
5. The Adviser shall give the Trust the benefit of the Adviser's best
judgment and efforts in rendering services under this Contract. As an
inducement to the Adviser's undertaking to render these services, the Trust
A-3
<PAGE> 35
agrees that the Adviser shall not be liable under this Contract for any
mistake in judgment or in any other event whatsoever provided that nothing
in this Contract shall be deemed to protect or purport to protect the
Adviser against any liability to the Trust or its shareholders to which the
Adviser would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of the Adviser's duties under
this Contract or by reason of the Adviser's reckless disregard of its
obligations and duties hereunder.
6. In consideration of the services to be rendered by the Adviser
under this Contract, each Portfolio shall pay the Adviser a monthly fee on
the first business day of each month based upon the average daily value (as
determined on each business day at the time set forth in the Prospectus for
determining the net asset value per share) of the net assets of each
Portfolio during the preceding month, at annual rates set forth in a
Supplement to this Contract with respect to each Portfolio. If the fees
payable to the Adviser pursuant to this paragraph 6 begin to accrue before
the end of any month or if this Contract terminates before the end of any
month, the fees for the period from that date to the end of that month or
from the beginning of that month to the date of termination, as the case
may be, shall be prorated according to the proportion which the period
bears to the full month in which the effectiveness or termination occurs.
For purposes of calculating the monthly fees, the value of the net assets
of each Portfolio shall be computed in the manner specified in the
Prospectus for the computation of net asset value. For purposes of this
Contract, a "business day" is any day the New York Stock Exchange is open
for trading.
7. If the aggregate expenses of every character incurred by, or
allocated to, each Portfolio in any fiscal year, other than interest,
taxes, expenses under the Master Distribution Plan, brokerage commissions
and other portfolio transaction expenses, other expenditures which are
capitalized in accordance with generally accepted accounting principles and
any extraordinary expense (including, without limitation, litigation and
indemnification expense), but including the fees payable under this
Contract and the fees payable to the Distributors under the Master
Distribution Plan ("includible expenses"), shall exceed the expense
limitations applicable to that Portfolio imposed by state securities law or
regulations thereunder, as these limitations may be raised or lowered from
time to time, the Adviser shall pay that Portfolio an amount equal to 50%
of that excess. With respect to portions of a fiscal year in which this
Contract shall be in effect, the foregoing limitations shall be prorated
according to the proportion which that portion of the fiscal year bears to
the full fiscal year. At the end of each month of the Trust's fiscal year,
the Distributors will review the includible expenses accrued during that
fiscal year to the end of the period and shall
A-4
<PAGE> 36
estimate the contemplated includible expenses for the balance of that
fiscal year. If, as a result of the review and estimation, it appears
likely that the includible expenses will exceed the limitations referred to
in this paragraph 7 for a fiscal year with respect to a Portfolio, the
monthly fees relating to that Portfolio payable to the Adviser under this
Contract for such month shall be reduced, subject to a later reimbursement
to reflect actual expenses, by an amount equal to 50% of a pro rata portion
(prorated on the basis of the remaining months of the fiscal year,
including the month just ended) of the amount by which the includible
expenses for the fiscal year (less an amount equal to the aggregate of
actual reductions made pursuant to this provision with respect to prior
months of the fiscal year) are expected to exceed the limitations provided
in this paragraph 7. For purposes of the foregoing, the value of the net
assets of each Portfolio shall be computed in the manner specified in
paragraph 6, and any payments required to be made by the Adviser shall be
made once a year promptly after the end of the Trust's fiscal year.
8. (a) This Contract and any Supplement hereto shall become effective
with respect to a Portfolio on the date specified in such Supplement and
shall thereafter continue in effect with respect to that Portfolio for a
period of more than two years from such date only so long as the
continuance is specifically approved at least annually (i) by the vote of a
majority of the outstanding voting securities of the Portfolio (as defined
in the 1940 Act) or by the Board of Trustees and (ii) by the vote, cast in
person at a meeting called for that purpose, of a majority of the members
of the Board of Trustees who are not parties to this Contract or
"interested persons" (as defined in the 1940 Act) of any such party.
(b) This Contract and any Supplement hereto may be terminated with
respect to a Portfolio at any time, without the payment of any penalty,
by a vote of a majority of the outstanding voting securities of that
Portfolio (as defined in the 1940 Act) or by a vote of a majority of the
entire Board of Trustees on 60 days' written notice to the Adviser or by
the Adviser on 60 days' written notice to the Trust. This Contract shall
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
9. Except to the extent necessary to perform the Adviser's
obligations under this Contract, nothing herein shall be deemed to limit or
restrict the right of the Adviser, or any affiliate of the Adviser, or any
employee of the Adviser, to engage in any other business or to devote time
and attention to the management or other aspects of any other business,
whether of a similar or dissimilar nature, or to render services of any
kind to any other corporation, firm, individual or association.
A-5
<PAGE> 37
10. The investment management services of the Adviser to the Trust
under this Contract are not to be deemed exclusive as to the Adviser and
the Adviser will be free to render similar services to others.
11. This Contract shall be construed in accordance with the laws of
the State of Delaware provided that nothing herein shall be construed in a
manner inconsistent with the 1940 Act.
12. In the event that the Board of Trustees shall establish one or
more additional investment portfolios, it shall so notify the Adviser in
writing. If the Adviser wishes to render investment advisory services to
such portfolio, it shall so notify the Trust in writing, whereupon such
portfolio shall become a Portfolio hereunder.
13. The Master Trust Agreement establishing the Trust (the "Master
Trust Agreement") provides that the name "FundManager Trust" refers to the
Trustees under the Master Trust Agreement collectively as Trustees and not
as individuals or personally, and that no shareholder, Trustee, officer,
employee or agent of the Trust shall be subject to claims against or
obligations of the Trust to any extent whatsoever, but that the Trust
estate only shall be liable.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-6
<PAGE> 38
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: Aggressive Growth Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
Aggressive Growth Portfolio (the "Portfolio") is a separate investment
portfolio of the Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the
Portfolio and the Adviser hereby acknowledges that the Master Advisory
Contract shall pertain to the Portfolio, the terms and conditions of the
Master Advisory Contract being hereby incorporated herein by reference.
4. The term "Portfolio" as used in the Master Advisory Contract
shall, for purposes of this Supplement, pertain to the Portfolio.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect to the Portfolio pay the Adviser a monthly fee on the first
business day of
A-7
<PAGE> 39
each month based upon the average daily value (as determined on each
business day at the time set forth in the Prospectus for determining net
asset value per share) of the net assets of the Portfolio during the
preceding month at the following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE PORTFOLIO FEE RATE
------------------------------------ --------
<S> <C>
Assets not exceeding $500 million......... 0.50%
Assets in excess of $500 million.......... 0.40%
</TABLE>
6. This Supplement and the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Portfolio on
, 1998 and shall thereafter continue in effect with
respect to the Portfolio only so long as the continuance is specifically
approved at least annually (a) by the vote of a majority of the outstanding
voting securities of the Portfolio (as defined in the 1940 Act) or by the
Board of Trustees and (b) by the vote, cast in person at a meeting called
for that purpose, of a majority of the members of the Board of Trustees who
are not parties to this Contract or "interested persons" (as defined in the
1940 Act) of any such party. This Contract may be terminated with respect
to the Portfolio at any time, without the payment of any penalty, by vote
of a majority of the outstanding voting securities of the Portfolio (as
defined in the 1940 Act) or by a vote of a majority of the outstanding
voting securities of the Portfolio (as defined in the 1940 Act) or by a
vote of a majority of the members of the Board of Trustees on 60 days'
written notice to the Trust. This Contract shall terminate automatically in
the event of its assignment as defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-8
<PAGE> 40
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: Growth with Income Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
Growth and Income Portfolio (the "Portfolio") is a separate investment
portfolio of the Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the
Portfolio and the Adviser hereby acknowledges that the Master Advisory
Contract shall pertain to the Portfolio, the terms and conditions of the
Master Advisory Contract being hereby incorporated herein by reference.
4. The term "Portfolio" as used in the Master Advisory Contract
shall, for purposes of this Supplement, pertain to the Portfolio.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect to the Portfolio pay the Adviser a monthly fee on the first
business day of
A-9
<PAGE> 41
each month based upon the average daily value (as determined on each
business day at the time set forth in the Prospectus for determining net
asset value per share) of the net assets of the Portfolio during the
preceding month at the following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE PORTFOLIO FEE RATE
------------------------------------ --------
<S> <C>
Assets not exceeding $500 million........... 0.50%
Assets in excess of $500 million............ 0.40%
</TABLE>
6. This Supplement and the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Portfolio on
, 1998 and shall thereafter continue in effect with respect to
the Portfolio only so long as the continuance is specifically approved at
least annually (a) by the vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by the Board of
Trustees and (b) by the vote, cast in person at a meeting called for that
purpose, of a majority of the members of the Board of Trustees who are not
parties to this Contract or "interested persons" (as defined in the 1940
Act) of any such party. This Contract may be terminated with respect to the
Portfolio at any time, without the payment of any penalty, by vote of a
majority of the outstanding voting securities of the Portfolio (as defined
in the 1940 Act) or by a vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by a vote of a
majority of the members of the Board of Trustees on 60 days' written notice
to the Trust. This Contract shall terminate automatically in the event of
its assignment as defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-10
<PAGE> 42
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: Growth Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
Growth Portfolio (the "Portfolio") is a separate investment portfolio of
the Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the
Portfolio and the Adviser hereby acknowledges that the Master Advisory
Contract shall pertain to the Portfolio, the terms and conditions of the
Master Advisory Contract being hereby incorporated herein by reference.
4. The term "Portfolio" as used in the Master Advisory Contract
shall, for purposes of this Supplement, pertain to the Portfolio.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect
A-11
<PAGE> 43
to the Portfolio pay the Adviser a monthly fee on the first business day of
each month based upon the average daily value (as determined on each
business day at the time set forth in the Prospectus for determining net
asset value per share) of the net assets of the Portfolio during the
preceding month at the following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE PORTFOLIO FEE RATE
------------------------------------ --------
<S> <C>
Assets not exceeding $500 million........... 0.50%
Assets in excess of $500 million............ 0.40%
</TABLE>
6. This Supplement and the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Portfolio on
, 1998 and shall thereafter continue in effect with respect to
the Portfolio only so long as the continuance is specifically approved at
least annually (a) by the vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by the Board of
Trustees and (b) by the vote, cast in person at a meeting called for that
purpose, of a majority of the members of the Board of Trustees who are not
parties to this Contract or "interested persons" (as defined in the 1940
Act) of any such party. This Contract may be terminated with respect to the
Portfolio at any time, without the payment of any penalty, by vote of a
majority of the outstanding voting securities of the Portfolio (as defined
in the 1940 Act) or by a vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by a vote of a
majority of the members of the Board of Trustees on 60 days' written notice
to the Trust. This Contract shall terminate automatically in the event of
its assignment as defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED:
FREEDOM CAPITAL FUNDMANAGER PORTFOLIOS
MANAGEMENT CORPORATION
By: By:
--------------------------------- ---------------------------------
Title: Title:
</TABLE>
A-12
<PAGE> 44
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: Bond Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
Bond Portfolio (the "Portfolio") is a separate investment portfolio of the
Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the
Portfolio and the Adviser hereby acknowledges that the Master Advisory
Contract shall pertain to the Portfolio, the terms and conditions of the
Master Advisory Contract being hereby incorporated herein by reference.
4. The term "Portfolio" as used in the Master Advisory Contract
shall, for purposes of this Supplement, pertain to the Portfolio.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect to the Portfolio pay the Adviser a monthly fee on the first
business day of each month based upon the average daily value (as
determined on each
A-13
<PAGE> 45
business day at the time set forth in the Prospectus for determining net
asset value per share) of the net assets of the Portfolio during the
preceding month at the following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE PORTFOLIO FEE RATE
------------------------------------ --------
<S> <C>
Assets not exceeding $500 million......... 0.50%
Assets in excess of $500 million.......... 0.40%
</TABLE>
6. This Supplement and the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Portfolio on
, 1998 and shall thereafter continue in effect with respect to
the Portfolio only so long as the continuance is specifically approved at
least annually (a) by the vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by the Board of
Trustees and (b) by the vote, cast in person at a meeting called for that
purpose, of a majority of the members of the Board of Trustees who are not
parties to this Contract or "interested persons" (as defined in the 1940
Act) of any such party. This Contract may be terminated with respect to the
Portfolio at any time, without the payment of any penalty, by vote of a
majority of the outstanding voting securities of the Portfolio (as defined
in the 1940 Act) or by a vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by a vote of a
majority of the members of the Board of Trustees on 60 days' written notice
to the Trust. This Contract shall terminate automatically in the event of
its assignment as defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-14
<PAGE> 46
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: Managed Total Return Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
Managed Total Return Portfolio (the "Portfolio") is a separate investment
portfolio of the Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the
Portfolio and the Adviser hereby acknowledges that the Master Advisory
Contract shall pertain to the Portfolio, the terms and conditions of the
Master Advisory Contract being hereby incorporated herein by reference.
4. The term "Portfolio" as used in the Master Advisory Contract
shall, for purposes of this Supplement, pertain to the Portfolio.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect
A-15
<PAGE> 47
to the Portfolio pay the Adviser a monthly fee on the first business day of
each month based upon the average daily value (as determined on each
business day at the time set forth in the Prospectus for determining net
asset value per share) of the net assets of the Portfolio during the
preceding month at the following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE PORTFOLIO FEE RATE
------------------------------------ --------
<S> <C>
Assets not exceeding $500 million........... 0.50%
Assets in excess of $500 million............ 0.40%
</TABLE>
6. This Supplement and the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Portfolio on
, 1998 and shall thereafter continue in effect with respect to
the Portfolio only so long as the continuance is specifically approved at
least annually (a) by the vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by the Board of
Trustees and (b) by the vote, cast in person at a meeting called for that
purpose, of a majority of the members of the Board of Trustees who are not
parties to this Contract or "interested persons" (as defined in the 1940
Act) of any such party. This Contract may be terminated with respect to the
Portfolio at any time, without the payment of any penalty, by vote of a
majority of the outstanding voting securities of the Portfolio (as defined
in the 1940 Act) or by a vote of a majority of the outstanding voting
securities of the Portfolio (as defined in the 1940 Act) or by a vote of a
majority of the members of the Board of Trustees on 60 days' written notice
to the Trust. This Contract shall terminate automatically in the event of
its assignment as defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-16
<PAGE> 48
INVESTMENT ADVISORY CONTRACT SUPPLEMENT
FUNDMANAGER PORTFOLIOS
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108
, 1998
FREEDOM CAPITAL MANAGEMENT CORPORATION
ONE BEACON STREET
BOSTON, MASSACHUSETTS 02108-3105
Dear Sirs:
Re: International Portfolio
This will confirm the agreement between the undersigned (the "Trust") and
Freedom Capital Management Corporation (the "Adviser") as follows:
1. The Trust is an open-end management investment company organized
as a Delaware business trust and consists of such separate investment
portfolios as have been or may be established by the Trustees of the Trust
from time to time. A separate class of shares of beneficial interest of the
Trust is offered to investors with respect to each investment portfolio.
International Portfolio (the "Fund") is a separate investment portfolio of
the Trust.
2. The Trust and the Adviser have entered in to a Master Investment
Advisory Contract ("Master Advisory Contract") pursuant to which the Trust
has employed the Adviser to provide investment advisory and other services
specified in the Master Advisory Contract and the Adviser has accepted such
employment. Terms used but not otherwise defined herein shall have the same
meanings assigned to them by the Master Advisory Contract.
3. As provided in paragraph 1 of the Master Advisory Contract, the
Trust hereby adopts the Master Advisory Contract with respect to the Fund
and the Adviser hereby acknowledges that the Master Advisory Contract shall
pertain to the Fund, the terms and conditions of the Master Advisory
Contract being hereby incorporated herein by reference.
4. The term "Fund" as used in the Master Advisory Contract shall, for
purposes of this Supplement, pertain to the Fund.
5. As provided in paragraph 6 of the Master Advisory Contract and
subject to further conditions as set forth therein, the Trust shall with
respect to the Fund pay the Adviser a monthly fee on the first business day
of each
A-17
<PAGE> 49
month based upon the average daily value (as determined on each business
day at the time set forth in the Prospectus for determining net asset value
per share) of the net assets of the Fund during the preceding month at the
following annual rates:
<TABLE>
<CAPTION>
PORTION OF AVERAGE DAILY
VALUE OF NET ASSETS OF THE FUND FEE RATE
------------------------------- --------
<S> <C>
Assets not exceeding $500 million........... 0.50%
Assets in excess of $500 million............ 0.40%
</TABLE>
6. This Supplement to the Master Advisory Contract (together, the
"Contract") shall become effective with respect to the Fund on
, 1998 and shall thereafter continue in effect with respect to
the Fund only so long as the continuance is specifically approved at least
annually (a) by the vote of a majority of the outstanding voting securities
of the Fund (as defined in the 1940 Act) or by the Board of Trustees and
(b) by the vote, cast in person at a meeting called for that purpose, of a
majority of the members of the Board of Trustees who are not parties to
this Contract or "interested persons" (as defined in the 1940 Act) of any
such party. This Contract may be terminated with respect to the Fund at any
time, without the payment of any penalty, by vote of a majority of the
outstanding voting securities of the Fund (as defined in the 1940 Act) or
by a vote of a majority of the outstanding voting securities of the Fund
(as defined in the 1940 Act) or by a vote of a majority of the members of
the Board of Trustees on 60 days' written notice to the Trust. This
Contract shall terminate automatically in the event of its assignment as
defined in the 1940 Act.
If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
<TABLE>
<S> <C>
Very truly yours,
ACCEPTED: FUNDMANAGER PORTFOLIOS
FREEDOM CAPITAL
MANAGEMENT CORPORATION
By: By:
- ------------------------------------ ------------------------------------
Title: Title:
</TABLE>
A-18
<PAGE> 50
VOTE THIS PROXY CARD TODAY!
(PLEASE DETACH AT PERFORATION BEFORE MAILING)
FUND NAME WILL PRINT HERE PROXY SOLICITATION BY THE BOARD OF TRUSTEES
THE UNDERSIGNED, REVOKING ALL PREVIOUS PROXIES, HEREBY APPOINT(S)
DEXTER A. DODGE AND JOHN J. DANELLO AND EACH OF THEM, ATTORNEYS WITH FULL POWER
OF SUBSTITUTION IN EACH, TO VOTE ALL THE SHARES OF BENEFICIAL INTEREST OF
ABOVE-REFERENCED FUND (THE "FUND"), A PORTFOLIO SERIES OF FUNDMANAGER PORTFOLIOS
(THE "TRUST"), WHICH THE UNDERSIGNED IS (ARE) ENTITLED TO VOTE AT THE SPECIAL
MEETING OF SHAREHOLDERS (THE "MEETING") OF THE FUND TO BE HELD AT THE OFFICES OF
THE TRUST, SIXTH FLOOR, ONE BEACON STREET, BOSTON, MASSACHUSETTS 02108, ON
WEDNESDAY, MAY 20, 1998 AT 3:00 P.M., BOSTON TIME, AND AT ANY ADJOURNMENT OR
POSTPONEMENT THEREOF. ALL POWERS MAY BE EXERCISED BY A MAJORITY OF SAID PROXY
HOLDERS OR SUBSTITUTES VOTING OR ACTING, OR, IF ONLY ONE VOTES AND ACTS, THEN BY
THAT ONE. RECEIPT OF THE PROXY STATEMENT IS HEREBY ACKNOWLEDGED. IF NOT REVOKED
IN THE MANNER DESCRIBED IN THE PROXY STATEMENT, THIS PROXY SHALL BE VOTED AS
SPECIFIED ON THE REVERSE SIDE.
PLEASE SIGN, DATE AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
DATE:_______________, 1998
NOTE: SIGNATURE(S) SHOULD AGREE WITH NAME(S)
PRINTED HEREIN. EXECUTORS, ADMINISTRATORS, TRUSTEES,
ETC. SHOULD SO INDICATE.
___________________________________________________
SIGNATURES
<PAGE> 51
VOTE THIS PROXY CARD TODAY!
(PLEASE DETACH AT PERFORATION BEFORE MAILING)
- --------------------------------------------------------------------------------
THIS PROXY SHALL BE VOTED IN FAVOR OF (FOR) PROPOSALS (1) AND (2) IF NO
SPECIFICATION IS MADE BELOW. AS TO ANY OTHER MATTER, SAID PROXY OR PROXIES SHALL
VOTE IN ACCORDANCE WITH THEIR BEST JUDGMENT. (THE FOLLOWING PROPOSALS ARE
NUMBERED TO CORRESPOND TO THE NUMBERING OF PROPOSALS CONTAINED IN THE PROXY
STATEMENT) PLEASE VOTE BY FILLING IN THE APPROPRIATE BOXES BELOW.
<TABLE>
<S> <C> <C> <C>
1. TO CONSIDER AND VOTE ON APPROVAL OF A NEW MASTER INVESTMENT ADVISORY
CONTRACT BETWEEN THE TRUST, ON BEHALF OF THE FUND, AND FREEDOM CAPITAL
MANAGEMENT CORPORATION. FOR / / AGAINST / / ABSTAIN / /
2. TO RATIFY THE SELECTION OF ERNST & YOUNG LLP AS THE INDEPENDENT
AUDITORS OF THE TRUST. FOR / / AGAINST / / ABSTAIN / /
</TABLE>
IN THE DISCRETION OF SAID PROXY OR PROXIES, TO ACT UPON SUCH OTHER MATTERS
AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR POSTPONEMENT
THEREOF.
