-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ii9T52Y3mVyHo0KpH8viUU1xI9GcUX54m7gsCKENMG7wdvc6YltJ/ceEoo8fV9iH lYyeQilvbrEu3f1XqcgJKA== 0000950137-97-003898.txt : 19971126 0000950137-97-003898.hdr.sgml : 19971126 ACCESSION NUMBER: 0000950137-97-003898 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19971218 FILED AS OF DATE: 19971125 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL BOND FUND CENTRAL INDEX KEY: 0000005094 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 520906083 STATE OF INCORPORATION: MD FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 811-02090 FILM NUMBER: 97727748 BUSINESS ADDRESS: STREET 1: 2800 POST OAK BLVD STREET 2: 46TH FLOOR CITY: HOUSTON STATE: TX ZIP: 77056 BUSINESS PHONE: 7139930500 MAIL ADDRESS: STREET 1: 2800 POST OAK BLVD STREET 2: 46TH FL CITY: HOUSTON STATE: TX ZIP: 77056 FORMER COMPANY: FORMER CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL BOND FUND INC DATE OF NAME CHANGE: 19960102 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CAPITAL BOND FUND INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN GENERAL BOND FUND INC DATE OF NAME CHANGE: 19831101 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES FUND CENTRAL INDEX KEY: 0000005099 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 520953662 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 001-06969 FILM NUMBER: 97727749 BUSINESS ADDRESS: STREET 1: 2800 POST OAK BLVD STREET 2: 46TH FLOOR CITY: HOUSTON STATE: TX ZIP: 77056 BUSINESS PHONE: 7139930500 MAIL ADDRESS: STREET 1: 2800 POST OAK BLVD STREET 2: 46TH FL CITY: HOUSTON STATE: TX ZIP: 77056 FORMER COMPANY: FORMER CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES INC DATE OF NAME CHANGE: 19960102 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CAPITAL CONVERTIBLE SECURITIES INC /TX DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN GENERAL CONVERTIBLE SECURITIES INC /TX DATE OF NAME CHANGE: 19600201 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL INCOME TRUST CENTRAL INDEX KEY: 0000820026 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 766040347 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 811-05273 FILM NUMBER: 97727750 BUSINESS ADDRESS: STREET 1: ONE PARKVIEW PLAZA CITY: CHICAGO STATE: IL ZIP: 60181 BUSINESS PHONE: 7139930500 MAIL ADDRESS: STREET 1: ONE PARKVIEW PLAZA CITY: CHICAGO STATE: IL ZIP: 60181 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CAPITAL INCOME TRUST DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CAPITAL BALANCED INCOME TRUST DATE OF NAME CHANGE: 19880327 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CAPITAL HIGH INCOME GOVERNMENT TRUST DATE OF NAME CHANGE: 19880327 DEF 14A 1 NOTICE OF ANNUAL MEETING 1 SCHEDULE 14A (RULE 14A-101) INFORMATION REQUIRED IN PROXY STATEMENT SCHEDULE 14A INFORMATION PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934 Filed by each Registrant /X/ Filed by a Party other than the Registrant / / Check the appropriate box: / / Preliminary Proxy Statement / / Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) /X/ Definitive Proxy Statement / / Definitive Additional Materials / / Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 VAN KAMPEN AMERICAN CAPITAL BOND FUND VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES FUND VAN KAMPEN AMERICAN CAPITAL INCOME TRUST - -------------------------------------------------------------------------------- (Name of each Registrant as Specified in its Charter) - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement if other than the Registrant) Payment of Filing Fee (Check the appropriate box): /X/ No Fee Required / / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. (1) Title of each class of securities to which transaction applies: - -------------------------------------------------------------------------------- (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: - -------------------------------------------------------------------------------- 2 November 1997 IMPORTANT NOTICE TO VAN KAMPEN AMERICAN CAPITAL CLOSED END FUND SHAREHOLDERS QUESTIONS & ANSWERS Although we recommend that you read the complete proxy statement, for your convenience, we have provided a brief overview of the issues to be voted on. Why am I receiving this proxy statement? This is the Joint Annual Meeting of Shareholders and your Trustees have nominated eight individuals for election to each Board as a result of a trans-action by and among Smith Barney Mutual Funds Management, Inc., and its affiliates and your Fund's Adviser and its affiliates. Please refer to the proxy statement for a detailed explanation of the proposed items. How will this affect my account? You can expect the same level of management expertise and high-quality shareholder service you've grown accustomed to. Will my vote make a difference? Your vote is needed to ensure that the proposals can be acted upon. Your immediate response on the enclosed proxy card(s) will help save on the costs of any further solicitations for a shareholder vote. We encourage all shareholders to participate in the governance of their Fund(s). How do the Trustees of each Fund suggest that I vote? After careful consideration, the Trustees of each Fund unanimously recommend that you vote "FOR" each of the items proposed on the enclosed proxy card(s). Who is paying for expenses related to the shareholders' meeting? Each Fund will pay its pro-rata portion of the expenses relating to the shareholders' meeting. Who do I call if I have questions? We will be happy to answer your questions about the proxy solicitation. Please call us at 1-800-341-2929 between 7:00 a.m. and 7:00 p.m. Central time, Monday through Friday. (TDD users call 1-800-421-2833.) Where do I mail my proxy card(s)? You may use the enclosed postage paid envelope or mail your proxy card(s) to: Proxy Tabulator P.O. Box 9113 Hingham, MA 02043-9113 3 ABOUT THE PROXY CARD Please vote on each issue using blue or black ink to mark an X in one of the boxes provided on the proxy card. Election of Trustees -- mark "For All," "Withhold" or "For All Except" To withhold authority to vote for one or more nominees, check "For All Except" and write the nominee's name(s) on the line below. Ratification of Independent Accountants -- mark "For," "Against" or "Abstain" Sign, date and return the proxy card in the enclosed postage-paid envelope. All registered owners of an account, as shown in the address, must sign the card. When signing as attorney, trustee, executor, administrator, custodian, guardian or corporate officer, please indicate your full title. /X/ PLEASE MARK VOTES AS IN THIS EXAMPLE PROXY VAN KAMPEN AMERICAN CAPITAL XXXXX ANNUAL MEETING OF SHAREHOLDERS SAMPLE For For All All Withhold Except 1. To vote to elect eight trustees to / / / / / / serve until their respective successors are duly elected and qualified. XXXXXXXXX, XXXXXXXXX, XXXXXXXXXX INSTRUCTIONS: to withhold authority to vote for one or more nominees check "For All Except" nominee, and write the nominee's name(s) on the line below. - ----------------------------------------------------- Please be sure to sign and date this Proxy. Date Shareholder sign here Co-owner sign here For Against Abstain 2. To ratify the selection of / / / / / / Ernst & Young LLP as the independent accountants. 4 VAN KAMPEN AMERICAN CAPITAL BOND FUND VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES FUND VAN KAMPEN AMERICAN CAPITAL INCOME TRUST ONE PARKVIEW PLAZA OAKBROOK TERRACE, ILLINOIS 60181 TELEPHONE (800) 341-2929 NOTICE OF JOINT ANNUAL MEETING OF SHAREHOLDERS TO BE HELD DECEMBER 18, 1997 A Joint Annual Meeting of Shareholders (the "Meeting") of Van Kampen American Capital Bond Fund (the "Bond Fund"), Van Kampen American Capital Convertible Securities Fund (the "Convertible Securities Fund") and Van Kampen American Capital Income Trust (the "Income Trust") (each a "Fund" and collectively, the "Funds"), will be held at the offices of Van Kampen American Capital, Inc., One Parkview Plaza, Oakbrook Terrace, Illinois 60181, on Thursday, December 18, 1997, at 3:00 p.m. for the following purposes: 1. With respect to each Fund, to elect eight Trustees (including seven new Trustees); 2. With respect to each Fund, to ratify or reject the selection of Ernst & Young LLP as independent accountants for its current fiscal year; and 3. To transact such other business as may properly come before the Meeting or any adjournments thereof. Shareholders of record at the close of business on October 31, 1997 are entitled to notice of and to vote at the Meeting or any adjournment thereof. By Order of the Board of Trustees /s/ Ronald A. Nyberg Ronald A. Nyberg, Vice President and Secretary November 25, 1997 5 EACH FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL REPORT (AND THE MOST RECENT SEMI-ANNUAL REPORT SUCCEEDING THE ANNUAL REPORT, IF ANY) TO A SHAREHOLDER UPON REQUEST. ANY SUCH REQUEST SHOULD BE DIRECTED TO THE VAN KAMPEN AMERICAN CAPITAL FUNDS BY CALLING (800) 341-2929 OR BY WRITING TO THE FUNDS AT ONE PARKVIEW PLAZA, OAKBROOK TERRACE, ILLINOIS 60181. SHAREHOLDERS OF THE FUNDS ARE INVITED TO ATTEND THE MEETING IN PERSON. IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD WITH RESPECT TO EACH FUND IN WHICH YOU WERE A SHAREHOLDER AS OF THE RECORD DATE, DATE AND SIGN SUCH PROXY CARD(S), AND RETURN IT (THEM) IN THE ENVELOPE PROVIDED, WHICH IS ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK THAT YOU MAIL YOUR PROXY PROMPTLY. THE BOARD OF TRUSTEES RECOMMENDS THAT YOU CAST YOUR VOTE: - FOR ALL OF THE NOMINEES FOR THE BOARD OF TRUSTEES OF EACH FUND LISTED IN THE PROXY STATEMENT. - FOR THE RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS INDEPENDENT ACCOUNTANTS FOR THE CURRENT FISCAL YEAR OF EACH FUND. YOUR VOTE IS IMPORTANT. PLEASE RETURN YOUR PROXY CARD(S) PROMPTLY NO MATTER HOW MANY SHARES YOU OWN. 6 PROXY STATEMENT VAN KAMPEN AMERICAN CAPITAL BOND FUND VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES FUND VAN KAMPEN AMERICAN CAPITAL INCOME TRUST ONE PARKVIEW PLAZA OAKBROOK TERRACE, ILLINOIS 60181 TELEPHONE (800) 341-2929 JOINT ANNUAL MEETING OF SHAREHOLDERS DECEMBER 18, 1997 This proxy statement is furnished in connection with the solicitation by the respective Board of Trustees (the "Board") of the Funds (defined below) of proxies to be voted at a Joint Annual Meeting of Shareholders, and all adjournments thereof (the "Meeting"), to be held at the offices of Van Kampen American Capital, Inc., One Parkview Plaza, Oakbrook Terrace, Illinois 60181, on Thursday, December 18, 1997, at 3:00 p.m. The approximate mailing date of this proxy statement and accompanying form of proxy is November 25, 1997. The primary purpose of the Meeting is to permit each Fund's shareholders to elect seven new Trustees and one incumbent Trustee and ratify or reject the selection of Ernst & Young LLP as independent accountants. Participating in the Meeting are holders of shares of beneficial interest (collectively, the "Shares") of Van Kampen American Capital Bond Fund, a Delaware business trust (the "Bond Fund"), Van Kampen American Capital Convertible Securities Fund, a Delaware business trust (the "Convertible Securities Fund") and Van Kampen American Capital Income Trust, a Massachusetts business trust (the "Income Trust"). The Bond Fund, Convertible Securities Fund and Income Trust are sometimes referred to herein individually as a "Fund" and collectively as the "Funds." The Meeting is scheduled as a joint meeting of the respective shareholders of the Funds because the shareholders of each Fund are expected to consider and vote on similar matters. The Board has determined that the use of a joint proxy statement for the Meeting is in the best interest of the shareholders of each Fund. In the event that any shareholder of any Fund present at the Meeting objects to the holding of a joint meeting and moves for an adjournment of the meeting of such Fund to a time immediately after the Meeting so that such Fund's meeting may be held separately, the persons named as proxies will vote in favor of the adjournment. Shareholders of each Fund will vote separately on each of the proposals relating to their Fund, and an unfavorable vote on a proposal by the shareholders of one Fund will not affect 7 the implementation of such a proposal by another Fund, if the proposal is approved by the shareholders of the other Fund. The Board has fixed the close of business on October 31, 1997, as the record date (the "Record Date") for the determination of holders of Shares of each Fund entitled to vote at the Meeting. Shareholders of a Fund on the Record Date will be entitled to one vote per share with respect to each proposal submitted to the shareholders of the Fund for each Share of the Fund then held, with no Share having cumulative voting rights. The following table summarizes each proposal to be presented at the Meeting and the Funds solicited with respect to such proposal:
PROPOSAL AFFECTED FUNDS -------- -------------- 1. Election of Trustees Each Fund 2. Ratification of Independent Accountants Each Fund
EACH FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL REPORT (AND THE MOST RECENT SEMI-ANNUAL REPORT SUCCEEDING THE ANNUAL REPORT, IF ANY) TO A SHAREHOLDER UPON REQUEST. ANY SUCH REQUEST SHOULD BE DIRECTED TO THE VAN KAMPEN AMERICAN CAPITAL FUNDS BY CALLING (800) 341-2929 OR BY WRITING TO THE RESPECTIVE FUND, ONE PARKVIEW PLAZA, OAKBROOK TERRACE, ILLINOIS 60181. At the close of business on October 31, 1997, there were issued and outstanding Shares of each of the Funds as set forth below:
TOTAL SHARES FUND NAME OUTSTANDING --------- ------------ Van Kampen American Capital Bond Fund ...................... 11,362,465 Van Kampen American Capital Convertible Securities Fund .... 3,251,323 Van Kampen American Capital Income Trust.................... 15,290,019
As of October 31, 1997, to the knowledge of each Fund, no person beneficially owned more than 5% of such Fund's outstanding shares. VOTING The voting requirement for passage of a particular proposal depends on the nature of the particular proposal. With respect to Proposal 1, a plurality of all the votes cast at the Meeting, with a quorum present, is required to elect a Trustee. With respect to Proposal 2, an affirmative vote of a majority of the votes cast by holders of Shares present in person or represented by proxy at the Meeting, with a quorum present, is required to ratify the selection of the independent accountants. 2 8 The Board recommends that you cast your vote: - FOR ALL of the nominees for the Board of Trustees of each Fund listed in the proxy statement. - FOR the ratification of the selection of Ernst & Young LLP as independent accountants for the current fiscal year of each Fund. All properly executed proxies received prior to the Meeting will be voted at the Meeting in accordance with the instructions marked thereon. Proxies received prior to the Meeting on which no vote is indicated will be voted "for" each proposal as to which it is entitled to vote. With respect to Proposal 2, abstentions and broker non-votes will not be considered "votes cast" on the proposal. Broker non-votes (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other person entitled to vote shares on a particular matter with respect to which the broker or nominees do not have discretionary power) will have the same effect as abstentions. A majority of the outstanding Shares of a Fund must be present in person or by proxy to have a quorum for such Fund to conduct business at the Meeting. Abstentions, broker non-votes and withhold authority votes will be counted as present for the purpose of determining a quorum. An unfavorable vote on a proposal by the shareholders of one Fund will not affect the implementation of such a proposal by another Fund. Shareholders who execute proxies may revoke them at any time before they are voted by filing with the respective Fund a written notice of revocation, by delivering a duly executed proxy bearing a later date or by attending the Meeting and voting in person. The Funds know of no business other than that mentioned in Proposals 1 and 2 of the Notice that will be presented for consideration at the Meeting. If any other matters are properly presented, it is the intention of the persons named on the enclosed proxy to vote proxies in accordance with their best judgment. In the event a quorum is present at the Meeting but sufficient votes to approve any of the proposals with respect to one or more Funds are not received, the persons named as proxies may propose one or more adjournments of the Meeting of such Fund to permit further solicitation of proxies provided they determine that such an adjournment and additional solicitation is reasonable and in the interest of shareholders based on a consideration of all relevant factors, including the nature of the relevant proposal, the percentage of affirmative votes then cast, the percentage of negative votes then cast, the nature of the proposed solicitation activities and the nature of the reasons for such further solicitation. 3 9 - ------------------------------------------------------------------------------ PROPOSAL 1: ELECTION OF TRUSTEES - ------------------------------------------------------------------------------ BACKGROUND Van Kampen American Capital Asset Management, Inc. serves as investment adviser to each Fund (the "Adviser"). The Adviser is a wholly-owned subsidiary of Van Kampen American Capital, Inc. ("VKAC"). VKAC is a diversified asset management company with more than two million retail investor accounts, extensive capabilities for managing institutional portfolios and more than $60 billion under management or supervision. VKAC's more than 50 open end and 37 closed end funds (including the Funds) and more than 2,500 unit investment trusts are professionally distributed by leading financial advisers nationwide. Generally, Van Kampen American Capital Distributors, Inc., a wholly-owned subsidiary of VKAC, has been the sponsor of the funds mentioned above and acts as distributor to such funds. VKAC is an indirect wholly-owned subsidiary of Morgan Stanley, Dean Witter, Discover & Co. ("MSDWD"). Prior to the Adviser becoming a subsidiary of VKAC in 1994, the Adviser was an indirect wholly-owned subsidiary of The Travelers Inc. and was therefore also affiliated with Smith Barney Mutual Funds Management, Inc. and PFS Distributors, Inc., other subsidiaries of The Travelers Inc. In 1994, the Adviser served as investment adviser to more than 30 open end funds, including the Funds, several funds organized under the Common Sense Trust (the "Common Sense Funds") and Van Kampen American Capital Exchange Fund ("Exchange Fund") (the Funds, the Common Sense Funds and the Exchange Fund collectively referred to as the "Fund Complex"). In 1994, other investment advisory subsidiaries of VKAC served as investment adviser to more than 20 open end funds and more than 30 closed end funds. The Common Sense Funds are currently advised by the Adviser and distributed by PFS Distributors, Inc. In addition, the Common Sense Trust International Equity Fund is subadvised by Smith Barney Mutual Funds Management Inc. Pursuant to recent transactions, the Adviser agreed to assign those advisory agreements for the Common Sense Funds to Smith Barney Mutual Funds Management Inc., subject to the approval of the Common Sense Funds' board of trustees and the Common Sense Funds' shareholders. NOMINATION OF TRUSTEES Each of the current Trustees serves as a Trustee for each of the Funds and for each of the Common Sense Funds. In connection with the events described above, the Funds would remain part of the VKAC family of funds and continue to be advised and serviced by the Adviser and its affiliates. Alternatively, the Common Sense Funds would become a part of the Smith Barney-related family of funds. 4 10 After meetings discussing these proposed transactions, the Trustees approved the advisory changes for the Common Sense Funds and approved submitting such changes to shareholders of the Common Sense Funds. In light of these events, the trustees have discussed the impacts, if any, on the Funds and the Fund's shareholders of these changes. The Trustees also discussed, among other things, the operating efficiency and effectiveness of boards of trustees in general and as they may be impacted by the proposed changes, the relationships between VKAC and Smith Barney-related entities, the understanding and capabilities of the Adviser and other service providers for closed end funds and the impact on the management companies of multiple boards for similar funds. The Trustees reviewed the background and experience of VKAC as they relate to closed end funds. Currently, VKAC serves as investment adviser to 37 closed end funds including the Funds; like the Funds, each of the other 34 closed end funds (the "VKAC Closed End Funds") has a board of trustees comprised of the same seven members. The Trustees reviewed the qualifications, knowledge and experience of the trustees of the VKAC Closed End Funds. Based on the foregoing, the Trustees considered it in the best interests of shareholders of the Funds to re-nominate Dr. Muller as a Trustee of each Fund and to nominate each nominee listed below as a Trustee of each Fund. As described in each nominee's respective biographical information below, each nominee is also a trustee or, in the case of Dr. Muller, a nominee, of the VKAC Closed End Funds. If elected, Dr. Muller would continue as a Trustee of the Funds and Dr. Muller will resign as a trustee of the Common Sense Trust. The Trustees, other than Dr. Muller, are resigning from the boards of the Funds and the Exchange Fund and will remain as trustees of the Common Sense Trust. CLASSES OF TRUSTEES Each Fund's Board is divided into three classes of Trustees, each class generally serving for a term of three years. Generally, the term of one class expires each year and no term shall continue for more than three years after the applicable election. This type of classification may prevent replacement of a majority of the Trustees for up to a two-year period. The foregoing is subject to the provisions of the 1940 Act and Delaware or Massachusetts law, depending upon the laws of which state a Fund is organized under, and the Declaration of Trust and By-Laws of each Fund. Dr. Muller is a Class III Trustee and is being elected for a three year term until the annual meeting of shareholders in 2000. The nominees have been classified as Class I, Class II or Class III Trustees and are being elected for the respective term associated with each class as indicated below. It is the intention of the persons named in the accompanying form of proxy to nominate and to vote such proxy for the election of the persons named below, or if any such persons shall be unable to serve, to vote for the election of such other 5 11 person or persons as shall be determined by the persons named in the proxy in accordance with their judgment. The Funds, however, have no reason to believe that it will be necessary to designate a substitute nominee. GENERAL INFORMATION The following schedule sets forth certain information regarding each nominee for election as Trustee. Dr. Muller is currently a member of the Board of Trustees. All nominees have consented to being named in this proxy statement and have agreed to serve if elected for each Fund. INFORMATION REGARDING NOMINEES FOR ELECTION
PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OR EMPLOYMENT IN PAST 5 YEARS --------------------- ----------------------------- David C. Arch(1).................. Mr. Arch is Chairman and Chief Executive 1800 Swift Drive Officer of Blistex Inc., a consumer health Oak Brook, IL 60521 care product's manufacturer. Director of Age: 52 Elmhurst College and the Illinois Manufacturers' Association. Mr. Arch is also a trustee of each of the VKAC Closed End Funds and two open end investment companies advised by Van Kampen American Capital Management, Inc. ("Management, Inc.") and is a nominee for Managing General Partner of the Exchange Fund. Rod Dammeyer(2)................... Mr. Dammeyer is Managing Director of EGI Two North Riverside Plaza (Equity Group Investments, Inc.) Corporate Suite 1950 Investments, a division of Equity Group Chicago, IL 60606 Investments, Inc., a company that makes Age: 57 private equity investments in other companies, and President, Chief Executive Officer and Director of Anixter International Inc., a value-added provider of integrated networking and cabling solutions that support business information and network infrastructure requirements (employed by Anixter since 1985). Prior to 1997, Mr. Dammeyer was President, Chief Executive Officer and a Director of Great American Management & Investment, Inc., a diversified manufacturing company. He is also a Director of Teletech Holdings Inc., Lukens, Inc., Falcon Building Products, Inc., Revco D.S., Inc., Jacor Communications, Inc., Capsure Holdings Corp., IMC Global Inc., Antec Corporation and a member of the Chase Manhattan Corporation National Advisory Board.
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PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OR EMPLOYMENT IN PAST 5 YEARS --------------------- ----------------------------- Mr. Dammeyer was previously a Director of Santa Fe Energy Resources, Inc., Lomas Financial Corporation, Santa Fe Pacific Corporation, Q-Tel, S.A. de C.V. and Servicios Financieros Quadrum, S.A. Mr. Dammeyer is also a trustee of each of the VKAC Closed End Funds and two open end investment companies advised by Management, Inc. and is a nominee for Managing General Partner of the Exchange Fund. Howard J Kerr(1).................. Mr. Kerr is President and Chief Executive 736 North Western Ave. Officer of Pocklington Corporation, Inc., an P.O. Box 317 investment holding company. Mr. Kerr is also Lake Forest, IL 60045 a Director of Canbra Foods, Ltd., a Canadian Age: 62 oilseed crushing, refining, processing and packaging operation. Mr. Kerr is also a trustee of each of the VKAC Closed End Funds and two open end investment companies advised by Management, Inc. and is a nominee for Managing General Partner of the Exchange Fund. Dennis J. McDonnell*(1)........... Mr. McDonnell is President, Chief Operating One Parkview Plaza Officer and a Director of Van Kampen Oakbrook Terrace, IL 60181 American Capital Advisory Corp. ("Advisory Age: 55 Corp."), the Adviser, Van Kampen American Capital Advisors, Inc. and Management, Inc. He is also an Executive Vice President and Director of VK/AC Holding, Inc. and VKAC. Mr. McDonnell is President and Director of Van Kampen Merritt Equity Advisors Corp. He is President and a trustee of the VKAC Closed End Funds and two open end investment companies advised by Management, Inc., a nominee for Managing General Partner of the Exchange Fund and President of open-end investment companies advised by the Adviser and Advisory Corp. Prior to September of 1996, Mr. McDonnell was Chief Executive Officer and Director of MCM Group, Inc., McCarthy, Crisanti and Maffei, Inc. and Chairman and Director of MCM Asia Pacific Company, Limited and MCM (Europe) Limited. Prior to July of 1996, Mr. McDonnell was President, Chief Operating Officer and Trustee of VSM Inc. and VCJ Inc. Mr. McDonnell has been an Executive Vice President of each Fund and the Exchange Fund since 1995.
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PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OR EMPLOYMENT IN PAST 5 YEARS --------------------- ----------------------------- Steven Muller, Ph.D.(3)........... Dr. Muller is Chairman of The 21st Century President Emeritus Foundation (public affairs). He is President The Johns Hopkins University Emeritus of The Johns Hopkins University. He Suite 711 is also a Director of Beneficial Corporation 1619 Massachusetts Avenue, N.W. (bank holding company) and Millipore Washington, D.C. 20036 Corporation (bio- technology). Prior to May, Age: 70 1997, Dr. Muller was a Director of BT Alex. Brown & Sons (investment banking). Dr. Muller is currently a Trustee of each Fund and the Common Sense Trust and a nominee for election as trustee of each of the VKAC Closed End Funds and as a Managing General Partner of the Exchange Fund. Dr. Muller was initially elected as a Trustee of each Fund in 1990. Theodore A. Myers(3).............. Mr. Myers is a Senior Financial Advisor of 550 Washington Avenue Qualitech Steel Corporation, a manufacturer Glencoe, IL 60022 of special quality bar products, as well as Age: 67 iron carbide (a steel scrap substitute). Mr. Myers is a Director of COVA Series Trust (an open end investment company). He is also a member of the Arthur Andersen Chief Financial Officer Advisory Committee. Prior to 1997, Mr. Myers was a Director of McLouth Steel, and prior to July of 1996, Mr. Myers was an executive Vice President and Chief Financial Officer of Qualitech Steel Corporation. Prior to August, 1993, Mr. Myers was Senior Vice President, Chief Financial Officer and a Director of Food Brands America (formerly known as Doskocil Companies, Inc.), a food processing and distribution company. Mr. Myers is also a trustee of each of the VKAC Closed End Funds and two open end investment companies advised by Management, Inc. and is a nominee for Managing General Partner of the Exchange Fund.
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PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OR EMPLOYMENT IN PAST 5 YEARS --------------------- ----------------------------- Hugo F. Sonnenschein(3)........... Mr. Sonnenschein is President of the 5801 South Ellis Avenue University of Chicago. Mr. Sonnenschein is a Suite 502 member of the Board of Trustees of the Chicago, IL 60637 University of Rochester and a member of its Age: 57 investment committee. Prior to July, 1993, Mr. Sonnenschein was Dean of the School of Arts and Sciences at the University of Pennsylvania. Mr. Sonnenschein is a member of the National Academy of Sciences and a fellow of the American Academy of Arts and Sciences. Mr. Sonnenschein is also a trustee of each of the VKAC Closed End Funds and two open end investment companies advised by Management, Inc. and is a nominee for Managing General Partner of the Exchange Fund. Wayne W. Whalen(2)................ Mr. Whalen is a partner in the law firm of 333 West Wacker Drive Skadden, Arps, Slate, Meagher & Flom Chicago, IL 60606 (Illinois), legal counsel to the VKAC Closed Age: 58 End Funds and certain open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Mr. Whalen is also a trustee of each of the VKAC Closed End Funds and a director/trustee of open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. and is a nominee for Managing General Partner of the Exchange Fund.
- ------------------------------------------------------------------------------ * Mr. McDonnell is an "interested person" (within the meaning of Section 2(a)(19) of the 1940 Act) of the Adviser and each Fund by reason of his position with the Adviser. (1) Term expires at the annual meeting of shareholders in 1998. (2) Term expires at the annual meeting of shareholders in 1999. (3) Term expires at the annual meeting of shareholders in 2000. OFFICERS OF THE FUNDS The following information relates to the executive officers of each Fund who are not nominees. Each officer also serves in the same capacity for all or a number of the other investment companies advised by the Adviser or an affiliate of the Adviser. The officers of each Fund serve for one year or until their respective successors are chosen and qualified. Each Fund's officers receive no compensation from the Funds but may also be officers of the Adviser or officers of affiliates of the Adviser and receive compensation in such capacities. 9 15
POSITIONS AND PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OFFICES WITH FUND DURING PAST 5 YEARS - --------------------- ----------------- --------------------- Peter Hegel.......... Vice President Executive Vice President of Advisory One Parkview Plaza of each Fund Corp., the Adviser, Management, Inc. Oakbrook Terrace, since 1996 and Van Kampen American Capital IL 60181 Advisors, Inc. Prior to July of 1996, Age: 41 Director of VSM Inc. Prior to September of 1996, Director of McCarthy, Crisanti & Maffei, Inc. Vice President of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Ronald A. Nyberg..... Vice President Executive Vice President, General One Parkview Plaza of each Fund Counsel, Secretary and Director of Oakbrook Terrace, since 1995 VKAC and VK/AC Holding, Inc. Executive IL 60181 Vice President, General Counsel, Age: 44 Assistant Secretary and Director of the Adviser, Advisory Corp., Van Kampen American Capital Advisors, Inc., Management, Inc., Van Kampen American Capital Distributors, Inc., Van Kampen American Capital Exchange Corporation, American Capital Contractual Services, Inc., Van Kampen American Capital Trust Company, VK/AC System, Inc., Van Kampen American Capital Insurance Agency of Illinois, Inc. and Van Kampen American Capital Recordkeeping Services, Inc. Executive Vice President, General Counsel and Assistant Secretary of ACCESS Investor Services, Inc. Executive Vice President, General Counsel and Director of Van Kampen Merritt Equity Advisors Corp. Prior to July of 1996, Executive Vice President and General Counsel of VSM Inc. and VCJ Inc. Prior to September of 1996, General Counsel of McCarthy, Crisanti & Maffei, Inc. Prior to June 1997, Director of ICI Mutual Insurance Co., a provider of insurance to members of the Investment Company Institute. Vice President and Secretary of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Alan T. Sachtleben... Vice President of Executive Vice President of the 2800 Post Oak Blvd. Convertible Adviser, Advisory Corp., Management, Houston, TX 77056 Securities Fund Inc. and Van Kampen American Capital Age: 55 since 1987 and Advisors, Inc. Vice President of open Bond Fund and end investment companies advised by Income Trust the Adviser and Advisory Corp. since 1996
10 16
POSITIONS AND PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OFFICES WITH FUND DURING PAST 5 YEARS - --------------------- ----------------- --------------------- Paul R. Wolkenberg... Vice President of Executive Vice President and a 2800 Post Oak Blvd. each Fund Director of VKAC Holding, Inc. and Houston, TX 77056 since 1990 VKAC. Executive Vice President of Van Age: 53 Kampen American Capital Distributors, Inc. and the Adviser. President and a Director of Van Kampen American Capital Trust Company and ACCESS Investor Services, Inc. President, Chief Operating Officer and a Director of Van Kampen American Capital Recordkeeping Services, Inc. Vice President of open end investment companies advised by the Adviser and Advisory Corp. Edward C. Wood III... Vice President and Senior Vice President of the Adviser, One Parkview Plaza Chief Financial Advisory Corp. and Management, Inc. Oakbrook Terrace, Officer of each Vice President and Chief Financial IL Fund Officer of the VKAC Closed End Funds 60181 since 1996 and open end investment companies Age: 41 advised by the Adviser, Advisory Corp. and Management, Inc. Curtis W. Morell..... Vice President and Senior Vice President of the Adviser 2800 Post Oak Blvd. Chief Accounting and Advisory Corp. Vice President and Houston, TX 77056 Officer of each Chief Accounting Officer of the VKAC Age: 51 Fund* Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. John L. Sullivan..... Treasurer of each First Vice President of the Adviser One Parkview Plaza Fund and Advisory Corp. Treasurer of the Oakbrook Terrace, since 1996 VKAC Closed End Funds and open end IL 60181 investment companies advised by the Age: 42 Adviser, Advisory Corp. and Management, Inc. Tanya M. Loden....... Controller of each Vice President of the Adviser and 2800 Post Oak Blvd. Fund Advisory Corp. Controller of the VKAC Houston, TX 77056 since 1991 Closed End Funds and open end Age: 38 investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Steven M. Hill....... Assistant Assistant Vice President of the One Parkview Plaza Treasurer Adviser and Advisory Corp. Assistant Oakbrook Terrace, of each Fund Treasurer of the VKAC Closed End Funds IL 60181 since 1996 and open end investment companies Age: 33 advised by the Adviser, Advisory Corp. and Management, Inc. Michael Robert Assistant Assistant Vice President of the Sullivan........... Controller of Adviser and Advisory Corp. Assistant 2800 Post Oak Blvd. each Fund Controller of the VKAC Closed End Houston, TX 77056 since 1996 Funds and open end investment Age: 64 companies advised by the Adviser, Advisory Corp. and Management, Inc.
11 17
POSITIONS AND PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OFFICES WITH FUND DURING PAST 5 YEARS - --------------------- ----------------- --------------------- Scott E. Martin...... Assistant Senior Vice President, Deputy General One Parkview Plaza Secretary Counsel and Assistant Secretary of Oakbrook, of each Fund VKAC and VK/AC Holding, Inc. Senior IL 60181 since 1996 Vice President, Deputy General Counsel Age: 41 and Secretary of Van Kampen American Capital Distributors, Inc., the Adviser, Advisory Corp., Management, Inc., Van Kampen American Capital Advisors, Inc., ACCESS Investor Services, Inc., Van Kampen American Capital Insurance Agency of Illinois, Inc., VK/AC System, Inc., Van Kampen American Capital Recordkeeping Services, Inc., Van Kampen American Capital Exchange Corporation, American Capital Contractual Services, Inc. and Van Kampen Merritt Equity Advisors Corp. Prior to April of 1997, Senior Vice President, Deputy General Counsel and Secretary of Van Kampen American Capital Services, Inc. and Van Kampen Merritt Holdings Corp. Prior to September of 1996, Deputy General Counsel and Secretary of McCarthy, Crisanti & Maffei, Inc. Prior to July of 1996, Senior Vice President, Deputy General Counsel and Secretary of VSM Inc. and VCJ Inc. Assistant Secretary of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Weston B. Assistant Vice President, Associate General Wetherell.......... Secretary of Counsel and Assistant Secretary of One Parkview Plaza each Fund since VKAC, Van Kampen American Capital Oakbrook, IL 60181 1996 Distributors, Inc., the Adviser, Age: 41 Advisory Corp., Management, Inc. and Van Kampen American Capital Advisors, Inc. Prior to September 1996, Assistant Secretary of McCarthy, Crisanti & Maffei, Inc. Assistant Secretary of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc.
12 18
POSITIONS AND PRINCIPAL OCCUPATIONS NAME, ADDRESS AND AGE OFFICES WITH FUND DURING PAST 5 YEARS - --------------------- ----------------- --------------------- Nicholas Dalmaso..... Assistant Vice President, Assistant Secretary One Park Plaza Secretary of and Senior Attorney of VKAC, the Oakbrook Terrace, each Fund since Adviser, Advisory Corp., Van Kampen IL 60181 1996 American Capital Distributors, Inc., Age: 32 Van Kampen American Capital Advisors, Inc. and Management, Inc. Assistant Secretary of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc. Huey P. Falgout, Assistant Assistant Vice President and Senior Jr................. Secretary of Attorney of VKAC. Assistant Vice 2800 Post Oak Blvd. each Fund President and Assistant Secretary of Houston, TX 77056 since 1996 the Adviser, Advisory Corp., ACCESS Age: 34 Investor Services, Inc., American Capital Contractual Services, Inc., Management, Inc., Van Kampen American Capital Exchange Corporation, Van Kampen American Capital Advisors, Inc. and Van Kampen American Capital Distributors, Inc. Assistant Secretary of the VKAC Closed End Funds and open end investment companies advised by the Adviser, Advisory Corp. and Management, Inc.
- ------------------------------------------------------------------------------ * Mr. Morell has been an officer of the Bond Fund and the Convertible Securities Fund since 1976 and an officer of the Income Trust since 1987. REMUNERATION PAID TO TRUSTEES No remuneration is paid by a Fund to a Trustee who is an affiliated person of the Adviser. Trustees who are not affiliated with the Adviser are compensated by each Fund and reimbursed for out-of-pocket expenses. The fees paid to the Trustees are calculated based upon an aggregate retainer and aggregate meeting fees for the Boards for which the Trustees serve which aggregate amounts are then allocated pro rata based upon the assets of the underlying funds. Each Trustee eligible for compensation on the Board of Bond Fund is currently compensated at the annual rate of $1,921 plus $128 for each Board and committee meeting attended. Each Trustee eligible for compensation on the Board of Income Trust is currently compensated at the annual rate of $1,551 plus $103 for each Board and committee meeting attended. Each Trustee eligible for compensation on the Board of Convertible Securities Fund is currently compensated at the annual rate of $1,416 plus $94 for each Board and committee meeting attended. Each Fund has adopted a retirement plan under which a Trustee who has received compensation from such Fund prior to such Trustee's retirement, has at 13 19 least 10 years of service (including years of service prior to the adoption of the retirement plan) and retires at or after attaining the age of 67 is eligible to receive a retirement benefit for each of the ten years following such retirement from the Fund. The retirement benefit payable per year is based upon the highest total annual compensation received by the Trustee in any of the three calendar years preceding retirement. A Trustee with at least five but less than ten years of service at retirement is eligible to receive a prorated reduced benefit. Finally, a Trustee may receive retirement benefits under each Fund's retirement plan in the event that such Trustee retires prior to age 67 after five years of service if the Nominating Committee of the Fund determines that the earlier retirement date is appropriate. Under the circumstances surrounding the decision to resign, the Nominating Committee of each Fund has determined that the early retirement of those Trustees under the age of 67 as of December 31, 1997 is appropriate under the circumstances and that such retiring Trustee should receive retirement benefits under the plan. In connection with their resignation from service as Trustees of the Funds, each resigning Trustee will receive the vested portion of their retirement benefits under the Fund's retirement plan. In addition, in recognition of their years of service, the Adviser or its affiliates will pay to each resigning Trustee an amount equal to the unvested portion of their retirement benefits. Further information about the retirement plan and retirement plan benefits are included in Annexes A and B. Additional information regarding the compensation and benefits paid by each Fund and the related funds in the Fund Complex is set forth in Annex A. The nominees have indicated that they are currently in the process of reviewing and seeking to adopt a comprehensive compensation and benefits package for the VKAC Closed End Funds and the Funds. Currently, each trustee of a VKAC Closed End Fund not affiliated with the fund's investment adviser receives an annual retainer of $2,500 and a meeting fee of $250 per meeting from each fund. Each VKAC Closed End Fund has a deferred compensation plan allowing trustees to defer receipt of all or a portion of their trustee compensation and the deferred amounts earn a rate of return determined by reference to the VKAC Closed End Fund(s) selected by such trustee. Each VKAC Closed End Fund has a retirement plan for its non-affiliated trustees which provides that each trustee that retires with ten or more years of service (including years of service prior to the plan's adoption) is eligible for a retirement benefit payable annually for the ten-year period following such trustee's retirement equal to the annual retainer in the year such trustee resigns. Under certain conditions, reduced benefits are available for early retirement. For the calendar year ended December 31, 1996, each non-affiliated trustee of the VKAC Closed End Funds earned aggregate compensation (prior to deferral) from the VKAC Closed End Funds' complex equal to approximately $138,500. For the calendar year ended December 31, 1996, Mr. Whalen, who serves as a trustee/director of other investment companies in the Van Kampen American Capital family of funds, earned aggregate compensation from funds advised by the 14 20 Adviser and its affiliates, including the VKAC Closed End Funds of approximately $243,400. MEETINGS AND COMMITTEES With respect to each Fund, the Board met seven times during the Fund's last fiscal year. During such fiscal year all Trustees attended at least 75% of the aggregate of (a) the total number of meetings of the Board and (b) the total number of meetings held by all committees of the Board on which they served. Each Fund has an Audit Committee which makes recommendations to the Board concerning the selection of each Fund's independent accountants, reviews with such independent accountants the scope and results of the annual audits and considers any comments which the independent accountants may have regarding such Fund's financial statements or books of account. The committee currently consists of Messrs. Carlton, Cocanougher, Gross, Merten, Muller, Pettit and Shepard. None of these Trustees, with the exception of Dr. Muller, is standing for election. With respect to Bond Fund, the Committee held two meetings during the last fiscal year. With respect to Convertible Securities Fund and Income Trust, the committee held three meetings during the last fiscal year. Each Fund has a Nominating Committee, the functions of which are (a) selecting and recommending to the Board nominees for election as trustees and (b) proposing and recommending to the Board the terms of compensation for trustees. The committee currently consists of Messrs. Cocanougher, Muller, Pettit and Shepard. None of the Trustees, with the exception of Dr. Muller, is standing for election. With respect to each Fund, the committee held three meetings during the last fiscal year. The committee is prepared to review nominations from shareholders to fill trusteeships in written communications addressed to the committee at each Fund's headquarters, although the committee expects to be able to identify from its own resources an ample number of qualified candidates. If the nominees listed for election as trustees of the Funds are elected by shareholders at the Meeting, they will replace the Trustees, with the exception of Dr. Muller, currently serving on the above-named committees. Committee assignments are expected to be decided by newly-elected trustees after the Meeting. SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Securities Exchange Act of 1934, as amended, requires each of the Fund's Trustees, officers, investment adviser, affiliated persons of the investment adviser and persons who own beneficially more than 10% of a registered class of the Fund's equity securities to file forms with the Securities and Exchange Commission ("SEC") and the New York Stock Exchange, Inc., reporting their affiliation with the Fund and reports of ownership and changes in ownership of Fund 15 21 Shares. These persons and entities are required by SEC regulations to furnish the Fund with copies of all such forms they file. Based on a review of these forms furnished to each Fund, each Fund believes that during the last fiscal year for each Fund, the Fund's Trustees, officers, investment adviser and affiliated persons of the investment adviser complied with the applicable filing requirements. To the knowledge of management of each Fund, no shareholder of any of the Funds owns more than 10% of a registered class of any Fund's equity securities. As of October 31, 1997, no nominees owned, directly or beneficially any Shares of the Funds. The Trustees, nominees and officers as a group owned, directly or beneficially, less than 1% of the outstanding Shares of each Fund as of October 31, 1997. At such date the "interested persons" of each Fund as a group owned an aggregate of less than 5% of the outstanding shares of the Fund. Mr. McDonnell owns preferred shares in MSAM Holdings II, Inc., a wholly-owned subsidiary of MSDWD, which in turn are exchangeable for shares of MSDWD and has options to purchase shares of MSDWD. In addition, Mr. McDonnell has entered into an employment contract with VKAC which terminates on February 17, 1998. SHAREHOLDER APPROVAL The shareholders of each Fund are entitled to vote on this issue. An affirmative vote of a plurality of the outstanding Shares of each Fund present in person or by proxy is required to elect the nominees for each Fund. THE BOARD OF TRUSTEES OF EACH FUND RECOMMENDS A VOTE "FOR ALL" OF THE NOMINEES. - ------------------------------------------------------------------------------ PROPOSAL 2: RATIFICATION OF INDEPENDENT ACCOUNTANTS - ------------------------------------------------------------------------------ The Board of Trustees of each Fund, including a majority of the Trustees who are not "interested persons" of each Fund (as defined by the 1940 Act), has selected the firm of Ernst & Young LLP, independent accountants, to examine the financial statements for the current fiscal year of each Fund. Each Fund knows of no direct or indirect financial interest of such firm in such Fund. Such appointment is subject to ratification or rejection by the shareholders of each Fund. Unless a contrary specification is made, the accompanying proxy will be voted in favor of ratifying the selection of such independent accountants. Representatives of Ernst & Young LLP are expected to be present at the Meeting and should be available to respond to questions from shareholders. SHAREHOLDER APPROVAL The shareholders of each Fund are entitled to vote on this issue. The affirmative vote of a majority of the Shares present in person or by proxy is required to ratify the selection of the independent accountants. THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" RATIFICATION OF THIS PROPOSAL. 16 22 - ------------------------------------------------------------------------------ EXPENSES - ------------------------------------------------------------------------------ The Funds will bear their pro-rata portion of the expense of preparing, printing and mailing the enclosed form of proxy, the accompanying Notice and this Proxy Statement. In order to obtain the necessary quorum at the Meeting, additional solicitation may be made by mail, telephone, telegraph or personal interview by representatives of a Fund, the Adviser, VKAC, Boston Financial Data Services, Inc. or by First Data Investors Services Group. First Data Investors Services Group, a solicitation firm located in Boston, Massachusetts, has been engaged to assist in proxy solicitation at an estimated cost of approximately $8,100 for the Bond Fund, $2,400 for the Convertible Securities Fund and $4,500 for the Income Trust. - ------------------------------------------------------------------------------ SHAREHOLDER PROPOSALS - ------------------------------------------------------------------------------ To be considered for presentation at a shareholders' meeting, rules promulgated by the SEC require that, among other things, a shareholder's proposal must be received at the offices of the relevant fund a reasonable time before a solicitation is made. Timely submission of a proposal does not necessarily mean that such proposal will be included. Any shareholder who wishes to submit proposals for consideration at a meeting of such shareholder's Fund should send such proposal to the Fund at One Parkview Plaza, Oakbrook Terrace, Illinois 60181. - ------------------------------------------------------------------------------ GENERAL - ------------------------------------------------------------------------------ Management of each Fund does not intend to present and does not have reason to believe that others will present any other items of business at the Meeting. However, if other matters are properly presented to the Meeting for a vote, the proxies will be voted upon such matters in accordance with the judgment of the persons acting under the proxies. A list of shareholders of each Fund entitled to be present and vote at the Meeting will be available at the offices of the respective Fund, One Parkview Plaza, Oakbrook Terrace, Illinois 60181, for inspection by any shareholder during regular business hours for ten days prior to the date of the Meeting. Failure of a quorum to be present at the Meeting for any Fund may necessitate adjournment and may subject such Fund to additional expense. IF YOU CANNOT BE PRESENT IN PERSON, YOU ARE REQUESTED TO FILL IN, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES. RONALD A. NYBERG, Vice President and Secretary November 25, 1997 17 23 ANNEX B AMOUNTS TO BE PAID TO TRUSTEES NOT STANDING FOR ELECTION The amounts shown below as payable by a Fund to a Trustee are lump sum amounts payable to such Trustee under each Fund's retirement plan. Payments will be made on or about January 1, 1998. Amounts shown below as payable by the Adviser or its affiliates are lump sum amounts payable in consideration of each Trustee's years of service and certain retirement benefits forgone by Trustees not standing for election.
CONVERTIBLE BOND FUND SECURITIES FUND INCOME TRUST ------------- --------------- ------------- 1. Donald M. Carlton From Fund.......................... $ 8,578 $ 6,577 $ 7,006 From Adviser....................... 12,000 9,200 9,800 Total.............................. 20,578 15,777 16,806 2. A. Benton Cocanougher From Fund.......................... $ 9,114 $ 6,970 $ 7,542 From Adviser....................... 12,750 9,750 10,550 Total.............................. 21,864 16,720 18,092 3. Stephen R. Gross From Fund.......................... $ 9,865 $ 7,595 $ 8,132 From Adviser....................... 13,800 10,625 11,375 Total.............................. 23,665 18,220 19,507 4. Alan G. Merten From Fund.......................... $ 8,578 $ 6,577 $ 7,006 From Adviser....................... 12,000 9,200 9,800 Total.............................. 20,578 15,777 16,806 5. R. Richardson Pettit From Fund.......................... $ 8,578 $ 6,577 $ 7,006 From Adviser....................... 12,000 9,200 9,800 Total.............................. 20,578 15,777 16,806 6. Alan B. Shepard From Fund.......................... $ 20,409 $ 14,690 $ 16,070 From Adviser....................... 0 0 0 Total.............................. 20,409 14,690 16,070
- ------------------------------------------------------------------------------ * Under the terms of each Fund's retirement plan, Trustees of the Bond Fund, the Convertible Securities Fund and the Income Fund are entitled in the aggregate to $65,122, $48,986 and $52,762, respectively, which represent discounted lump sum payments of each Trustee's vested retirement benefits to be paid in lieu of receiving benefits over 10 years. In connection with the years of service and retirement benefits forgone by the Trustees, the Adviser or its affiliates will pay to the resigning Trustees of the Bond Fund, the Convertible Securities Fund and the Income Fund amounts totalling $62,550, $47,975 and $51,325, respectively. B-1 24 - -- A Wealth of Knowledge * A Knowledge of Wealth(SM) -- VAN KAMPEN AMERICAN CAPITAL LOGO AGC-PS-97 25 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please be sure to sign and date this Proxy. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- VAN KAMPEN AMERICAN CAPITAL BOND FUND FOR THE ANNUAL MEETING OF SHAREHOLDERS PROXY SOLICITED BY THE TRUSTEES TO BE HELD ON DECEMBER 18, 1997 The undersigned, revoking previous proxies, hereby appoint(s) Ronald A. Nyberg, Weston B. Wetherell and Edward C. Wood, III or any one or more of them, proxies, with full power of substitution, to vote all shares of the Fund as indicated above which the undersigned is entitled to vote at the Joint Annual Meeting of Shareholders of the Fund to be held at the offices of Van Kampen American Capital, Inc., One Parkview Plaza, Oakbrook Terrace, Illinois 60181, on Thursday, December 18, 1997 at 3:00 p.m., and at any adjournments 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. This Proxy shall be voted on the proposals described in the Proxy Statement as specified on the reverse side. Receipt of the Notice of the Meeting and the accompanying Proxy Statement is hereby acknowledged. PLEASE SIGN, DATE, AND RETURN PROMPTLY IN ENCLOSED ENVELOPE Date , 1997 ---------------------- NOTE: Please sign exactly as your name appears on this Proxy. When signing in a fiduciary capacity, such as executor, administrator, trustee, attorney, guardian, etc., please so indicate. Corporate and partnership proxies should be signed by an authorized person indicating the persons's title. ------------------------------------ | | | | ------------------------------------ Signature(s) (Title), if applicable) WHEN SHARES ARE REGISTERED WITH JOINT OWNERS, ALL JOINT OWNERS SHOULD SIGN. 26 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- Please refer to the Proxy Statement discussion of the following matters: IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSALS. As to any other matter, said proxies shall vote in accordance with their best judgment. THE TRUSTEES RECOMMEND A VOTE FOR EACH OF THE FOLLOWING PROPOSALS: PLEASE VOTE BY FILLING IN THE APPROPRIATE BOXES BELOW, AS SHOWN, USING BLUE OR BLACK INK OR DARK PENCIL. DO NOT USE RED INK. [ ] 1. To vote to elect eight trustees to serve until FOR FOR ALL their respective successors are duly elected and ALL WITHHOLD EXCEPT qualified. David C. Arch, Rod Dammeyer, [ ] [ ] [ ] Howard J Kerr, Dennis J. McDonnell, Steven Muller, Theodore A. Myers, Hugo F. Sonnenschein, Wayne W. Whalen INSTRUCTION: to withhold authority to vote for one or more nominees, check FOR ALL EXCEPT and write the nominee's name(s) on the line below. ______________________________________ 2. To ratify the selection of Ernst & Young LLP FOR AGAINST ABSTAIN as independent accountants. [ ] [ ] [ ] 2 27 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please be sure to sign and date this Proxy. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- VAN KAMPEN AMERICAN CAPITAL CONVERTIBLE SECURITIES FUND FOR THE ANNUAL PROXY SOLICITED BY THE TRUSTEES MEETING OF SHAREHOLDERS TO BE HELD ON DECEMBER 18, 1997 The undersigned, revoking previous proxies, hereby appoint(s) Ronald A. Nyberg, Weston B. Wetherell and Edward C. Wood, III or any one or more of them, proxies, with full power of substitution, to vote all shares of the Fund as indicated above which the undersigned is entitled to vote at the Joint Annual Meeting of Shareholders of the Fund to be held at the offices of Van Kampen American Capital, Inc., One Parkview Plaza, Oakbrook Terrace, Illinois 60181, on Thursday, December 18, 1997 at 3:00 p.m., and at any adjournments 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. This Proxy shall be voted on the proposals described in the Proxy Statement as specified on the reverse side. Receipt of the Notice of the Meeting and the accompanying Proxy Statement is hereby acknowledged. PLEASE SIGN, DATE, AND RETURN PROMPTLY IN ENCLOSED ENVELOPE Date , 1997 ---------------------- NOTE: Please sign exactly as your name appears on this Proxy. When signing in a fiduciary capacity, such as executor, administrator, trustee, attorney, guardian, etc., please so indicate. Corporate and partnership proxies should be signed by an authorized person indicating the persons's title. ------------------------------------ | | | | ------------------------------------ Signature(s) (Title), if applicable) WHEN SHARES ARE REGISTERED WITH JOINT OWNERS, ALL JOINT OWNERS SHOULD SIGN. 28 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- Please refer to the Proxy Statement discussion of the following matters: IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSALS. As to any other matter, said proxies shall vote in accordance with their best judgment. THE TRUSTEES RECOMMEND A VOTE FOR EACH OF THE FOLLOWING PROPOSALS: PLEASE VOTE BY FILLING IN THE APPROPRIATE BOXES BELOW, AS SHOWN, USING BLUE OR BLACK INK OR DARK PENCIL. DO NOT USE RED INK. [ ] 1. To vote to elect eight trustees to serve until FOR FOR ALL their respective successors are duly elected and ALL WITHHOLD EXCEPT qualified. David C. Arch, Rod Dammeyer, [ ] [ ] [ ] Howard J Kerr, Dennis J. McDonnell, Steven Muller, Theodore A. Myers, Hugo F. Sonnenschein, Wayne W. Whalen INSTRUCTION: to withhold authority to vote for one or more nominees, check FOR ALL EXCEPT and write the nominee's name(s) on the line below. ______________________________________ 2. To ratify the selection of Ernst & Young LLP FOR AGAINST ABSTAIN as independent accountants. [ ] [ ] [ ] 29 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please be sure to sign and date this Proxy. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- VAN KAMPEN AMERICAN CAPITAL INCOME TRUST FOR THE ANNUAL MEETING OF PROXY SOLICITED BY THE TRUSTEES SHAREHOLDERS TO BE HELD ON DECEMBER 18, 1997 The undersigned, revoking previous proxies, hereby appoint(s) Ronald A. Nyberg, Weston B. Wetherell and Edward C. Wood, III or any one or more of them, proxies, with full power of substitution, to vote all shares of the Fund as indicated above which the undersigned is entitled to vote at the Joint Annual Meeting of Shareholders of the Fund to be held at the offices of Van Kampen American Capital, Inc., One Parkview Plaza, Oakbrook Terrace, Illinois 60181, on Thursday, December 18, 1997 at 3:00 pm., and at any adjournments 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. This Proxy shall be voted on the proposals described in the Proxy Statement as specified on the reverse side. Receipt of the Notice of the Meeting and the accompanying Proxy Statement is hereby acknowledged. PLEASE SIGN, DATE, AND RETURN PROMPTLY IN ENCLOSED ENVELOPE Date , 1997 ---------------------- NOTE: Please sign exactly as your name appears on this Proxy. When signing in a fiduciary capacity, such as executor, administrator, trustee, attorney, guardian, etc., please so indicate. Corporate and partnership proxies should be signed by an authorized person indicating the persons's title. ------------------------------------ | | | | ------------------------------------ Signature(s) (Title), if applicable) WHEN SHARES ARE REGISTERED WITH JOINT OWNERS, ALL JOINT OWNERS SHOULD SIGN. 30 VOTE THIS PROXY CARD TODAY! YOUR PROMPT RESPONSE WILL SAVE THE EXPENSE OF ADDITIONAL MAILINGS. Please return the proxy card in the enclosed envelope. -Please fold and detach card at perforation before mailing- Please refer to the Proxy Statement discussion of the following matters: IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSALS. As to any other matter, said proxies shall vote in accordance with their best judgment. THE TRUSTEES RECOMMEND A VOTE FOR EACH OF THE FOLLOWING PROPOSALS: PLEASE VOTE BY FILLING IN THE APPROPRIATE BOXES BELOW, AS SHOWN, USING BLUE OR BLACK INK OR DARK PENCIL. DO NOT USE RED INK. [ ] 1. To vote to elect eight trustees to serve until FOR FOR ALL their respective successors are duly elected and ALL WITHHOLD EXCEPT qualified. David C. Arch, Rod Dammeyer, [ ] [ ] [ ] Howard J Kerr, Dennis J. McDonnell, Steven Muller, Theodore A. Myers, Hugo F. Sonnenschein, Wayne W. Whalen INSTRUCTION: to withhold authority to vote for one or more nominees, check FOR ALL EXCEPT and write the nominee's name(s) on the line below. ______________________________________ 2. To ratify the selection of Ernst & Young LLP FOR AGAINST ABSTAIN as independent accountants. [ ] [ ] [ ] -----END PRIVACY-ENHANCED MESSAGE-----