-----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, WrRyt3LwbFe7aoNT24YaI9vdsCdOS/x+fgXPhLPFpeILvER1/ijFq0gP60lNNfTj mpFbZ758o6JOBjhyaZQr/w== 0000898430-03-003263.txt : 20030613 0000898430-03-003263.hdr.sgml : 20030613 20030613155419 ACCESSION NUMBER: 0000898430-03-003263 CONFORMED SUBMISSION TYPE: PRE 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20031003 FILED AS OF DATE: 20030613 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RUSSELL INVESTMENT FUNDS CENTRAL INDEX KEY: 0000824036 IRS NUMBER: 911717303 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-05371 FILM NUMBER: 03743829 BUSINESS ADDRESS: STREET 1: 909 A ST STREET 2: C/O FRANK RUSSELL CO CITY: TACOMA STATE: WA ZIP: 98402 BUSINESS PHONE: 2535729500 MAIL ADDRESS: STREET 1: P O BOX 1616 CITY: TAKOMA STATE: WA ZIP: 98401-1616 FORMER COMPANY: FORMER CONFORMED NAME: RUSSELL INSURANCE FUNDS DATE OF NAME CHANGE: 19960918 PRE 14A 1 dpre14a.txt PRELIMINARY PROXY STATEMENT SCHEDULE 14A 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: [X] Preliminary Proxy [_] Confidential, for Statement Use of the Commission Only (as [_] Definitive Proxy permitted by Rule Statement 14a-6(e)(2)) [_] Definitive Additional Materials [_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 Russell Investment Funds (Name of Registrant as Specified In Its Charter) (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): [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 fees 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: ------------------------------------------------------------------------- RUSSELL INVESTMENT FUNDS 909 A STREET TACOMA, WASHINGTON 98402 [Phone Number] Dear Shareholder: Enclosed is a Notice of Special Meeting of shareholders of Russell Investment Funds ("RIF"). The Special Meeting has been called for October 3, 2003 at a.m., local time, at the offices of RIF at 909 A Street, Tacoma, Washington 98402. The accompanying Proxy Statement details the proposals being presented for consideration by shareholders of RIF's series (each a "Fund," and, collectively, the "Funds"). Shareholders will be asked to consider the following proposals at the Special Meeting: 1. To elect three members of the Board of Trustees of RIF; 2. To approve a change to each Fund's fundamental investment objective; 3. To approve the reclassification of the investment objective of each Fund from "fundamental" to "non-fundamental"; and 4. To consider and act on any other business (none being known as of the date of this notice) as may legally come before the Special Meeting or any adjournment thereof. The enclosed materials provide details of the proposals. A proxy or voting instruction card for the Special Meeting is enclosed. IT IS IMPORTANT THAT YOU COMPLETE, SIGN AND RETURN YOUR CARD, OR TAKE ADVANTAGE OF THE FACSIMILE, TELEPHONIC OR ELECTRONIC VOTING OR VOTING INSTRUCTION PROCEDURES DESCRIBED IN THE PROXY OR VOTING INSTRUCTION CARD, AS SOON AS POSSIBLE TO ENSURE THAT YOUR VOTE OR INSTRUCTIONS ARE COUNTED AT THE SPECIAL MEETING. Sincerely, Karl J. Ege Secretary Note: You may receive more than one card. PLEASE COMPLETE EACH CARD PROVIDED. RUSSELL INVESTMENT FUNDS Multi-Style Equity Fund Aggressive Equity Fund Non-US Fund Core Bond Fund Real Estate Securities Fund (each a "Fund," and, collectively, the "Funds") 909 A STREET TACOMA, WASHINGTON 98402 ----------------- NOTICE OF SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 3, 2003 ----------------- NOTICE IS HEREBY GIVEN that a Special Meeting of the shareholders of the Funds, each a series of Russell Investment Funds ("RIF"), will be held at RIF's offices located at 909 A Street, Tacoma, Washington, on October 3, 2003 at a.m., local time, for the following purposes: 1. To elect three members of the Board of Trustees of RIF; 2. To approve a change to the fundamental investment objective of each Fund; 3. To approve the reclassification of the investment objective of each Fund from "fundamental" to "non-fundamental"; and 4. To consider and act on any other business (none being known as of the date of this notice) as may legally come before the Special Meeting or any adjournment thereof. The attached Proxy Statement provides more information concerning each of the proposed items upon which shareholders will be asked to vote. Shareholders of record as of the close of business on July 7, 2003 are entitled to notice of, and to vote at, the Special Meeting or any adjournment thereof. By Order of the Board of Trustees, Karl J. Ege Secretary Tacoma, Washington July 8, 2003 IT IS IMPORTANT THAT SHARES REPRESENTED BY YOUR VOTING INSTRUCTIONS BE REPRESENTED AT THE SPECIAL MEETING! WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE SPECIAL MEETING, PLEASE COMPLETE AND SIGN THE ENCLOSED PROXY CARD OR VOTING INSTRUCTION CARD AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES, OR TAKE ADVANTAGE OF THE FACSIMILE, TELEPHONIC OR INTERNET VOTING PROCEDURES DESCRIBED IN THE PROXY CARD OR VOTING INSTRUCTION CARD. TABLE OF CONTENTS
PAGE ---------- Questions and Answers About the Special Meeting and the Proxy Statement.. 2 Proposal 1: Election of Trustees to the Board of Trustees of RIF........ 4 Proposal 2: To change the fundamental investment objectives of the Funds 12 Proposal 3: To make each Fund's investment objective non-fundamental.... 13 Other Business........................................................... 15 Information about RIF.................................................... 15 Further Information...................................................... 17 List of Names and Addresses of Money Managers............................ Appendix A Beneficial Owners of the Funds........................................... Appendix B
RUSSELL INVESTMENT FUNDS 909 A Street Tacoma, Washington 98402 [Phone Number] ----------------- PROXY STATEMENT ----------------- DATED July 8, 2003 FOR A SPECIAL MEETING OF SHAREHOLDERS OF Multi-Style Equity Fund Aggressive Equity Fund Non-US Fund Core Bond Fund Real Estate Securities Fund (each a "Fund," and, collectively, the "Funds") EACH A SERIES OF RUSSELL INVESTMENT FUNDS ("RIF") QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE PROXY STATEMENT GENERAL INFORMATION ABOUT THE PROPOSALS Q. What is the purpose of this proxy statement? A. You are receiving these proxy materials--a booklet that includes the Proxy Statement and one or more proxy or voting instruction cards--because you have the right to vote or give voting instructions on important proposals concerning your investment in your Fund(s). The principal purpose of this Proxy Statement is to seek shareholder approval of the matters identified in the table below.
Proposal Shareholders Solicited -------- ---------------------- 1. To elect three members of the Board of Trustees of RIF. Each Fund 2(a) To approve changes to the fundamental investment Each Fund through objectives of the Funds. 2(e) 3. To approve a change to the fundamental investment Each Fund objectives of the Funds to make them non-fundamental.
INFORMATION ABOUT VOTING Q. Who is asking for my vote? A. The Board of Trustees (the "Board" or the "Trustees") of RIF has requested your vote on several matters in connection with the Special Meeting (the "Special Meeting") of shareholders of the series of RIF (the "Shareholders"). The Special Meeting will be held at a.m., local time, on October 3, 2003, at the offices of RIF located at 909 A Street, Tacoma, Washington. RIF proposes to mail the Notice of Special Meeting, the proxy card and the Proxy Statement to Shareholders of record on or about July , 2003. As described below, on or about such date, the Notice of Special Meeting, Proxy Statement and a voting instruction card will be mailed to holders of certain variable annuity contracts and variable life insurance policies who have the right to instruct Shareholders of record how to vote at the Special Meeting. Q. Who is eligible to vote? A. RIF has the following five series, or funds, in all (each a "Fund," and, collectively, the "Funds"): Multi-Style Equity Fund, Aggressive Equity Fund, Non-US Fund, Core Bond Fund and Real Estate Securities Fund. Shareholders of record of the Funds at the close of business on July 7, 2003 (the "Record Date") are entitled to notice of and to vote at the Special Meeting or at any adjournment of the Special Meeting on the proposals applicable to the Fund(s) for which they hold shares. Shareholders of record will be entitled to one vote for each full share and a fractional vote for each fractional share that they hold on each matter presented at the Special Meeting. The Funds serve as investment vehicles for variable annuity contracts and variable life insurance policies (the "Variable Contracts" and "Variable Policies") issued by various life insurance companies (the "Participating Insurance Companies"). Participating Insurance Companies may also invest their own general account assets in RIF. All shares of the Funds are owned of record by sub-accounts of separate accounts ("Separate Accounts") established to fund the Variable Contracts and Variable Policies issued by the Participating Insurance Companies or by the Participating Insurance Companies in their general accounts. 2 Each Participating Insurance Company, to the extent required by the Investment Company Act of 1940, as amended (the "1940 Act"), will solicit voting instructions from Variable Contract and Variable Policy owners who beneficially own shares of a Fund through a Separate Account (a "1940 Act Separate Account") of such Participating Insurance Company as of the Record Date (the "Contractowners"). These shares will be voted by the applicable Participating Insurance Company as timely directed by the Contractowners. Each Participating Insurance Company will vote the shares of each 1940 Act Separate Account for which no timely instructions are received from a Contractowner in the same proportion as dictated by the timely voting instructions received from other Contractowners for shares of such Fund held in that 1940 Act Separate Account. RIF has been advised by certain Participating Insurance Companies that they are not required by the 1940 Act to solicit voting instructions from the owners of Variable Contracts or Variable Policies who own shares of a Fund through certain of their Separate Accounts (the "Non-1940 Act Separate Accounts") and that such Participating Insurance Companies therefore will not solicit voting instructions from the Variable Contract or Variable Policy owners that beneficially own shares of a Fund through a Non-1940 Act Separate Account (and such Variable Contract or Variable Policy owners are not included in the term "Contractowners" as used herein). Fund shares held in a Non-1940 Act Separate Account will be represented at the Special Meeting by the applicable Participating Insurance Company and voted in the same proportion as the aggregate of votes cast with respect to shares of such Fund held in all of that Participating Insurance Company's 1940 Act Separate Accounts or in such other manner as may be required by law. Q. How do I deliver voting instructions to my Participating Insurance Company? A. Contractowners may instruct their Participating Insurance Company how to vote shares of the Funds attributable to their Variable Contract or Variable Policy in writing, by executing the enclosed voting instruction card and returning it in the envelope provided or via facsimile, telephone or the Internet as described in the proxy or voting instruction card. The Participating Insurance Companies have fixed 4:00 p.m. Eastern time on [DATE] as the last day and time on which voting instructions will be accepted. Voting instructions received after this date and time will not be considered. To give voting instructions via the Internet, please access the website listed on your instruction card(s) or noted in the enclosed voting instructions. To give voting instructions via the Internet, you will need the "control number" that appears on your voting instruction card. The Internet voting procedures are designed to authenticate your identity, to allow you to give voting instructions and to confirm that your instructions have been recorded properly. If you vote via the Internet, you may incur costs associated with electronic access providers and telephone companies. Voting instruction card(s) that are properly signed, dated and received prior to 4:00 p.m. Eastern time on [date] and proper voting instructions received via facsimile, telephone or the Internet prior to 4:00 p.m. Eastern time on [DATE], will be voted by your Participating Insurance Company in accordance with the instructions received. If you sign, date and return the voting instruction card(s), but do not specify a vote for one or more of the Proposals, your Participating Insurance Company will vote the shares of each Fund represented by your voting instructions on the Proposals for which you have not specified a vote as follows: . IN FAVOR of electing each of the nominees to serve on the Board of Trustees of RIF (Proposal 1); . IN FAVOR of approving a change to the investment objective, currently a fundamental investment restriction, of each Fund, (Proposals 2(a) through 2(e), voted on a Fund-by-Fund basis); and . IN FAVOR of approving a change to the fundamental investment objective of each Fund to make it non-fundamental (Proposal 3, voted on a Fund-by-Fund basis). 3 Q. If I send my voting instructions in now as requested, can I change my instructions later? A. Contractowners may revoke their voting instructions at any time prior to 4:00 p.m. Eastern time on [DATE] by submitting written notice of revocation, a later-dated instruction card or a later-dated voting instruction via facsimile, telephone or the Internet. Revocations of voting instructions received after this date and time will not be accepted. Q. How do the Trustees recommend that I vote for these proposals? A. The Trustees recommend that Shareholders and Contractowners vote FOR each proposal. Q. Whom should I call for additional information about this Proxy Statement? A. Please call D.F. King & Co., Inc., RIF's information agent, toll-free at 1-800- - . GENERAL INFORMATION ABOUT THE FUNDS Q. How are the Funds managed? A. RIF is an open-end, management investment company organized under the laws of the Commonwealth of Massachusetts, with principal offices located at 909 A Street, Tacoma, Washington 98402. Under Massachusetts law, each Fund is a "sub-trust" of RIF. The management of the business and affairs of RIF is the responsibility of the Board. The Board oversees the Funds' operations, including reviewing and approving the Funds' contracts with the Funds' investment adviser, Frank Russell Investment Management Company ("FRIMCo") and the Funds' respective sub-advisers ("Money Managers"). RIF's officers are responsible for the day-to-day management and administration of the Funds' operations. The Money Managers are responsible for selection of individual portfolio securities for the assets assigned to them. RIF has received an exemptive order from the U.S. Securities and Exchange Commission ("SEC") which permits RIF, with the approval of the Board, to engage and terminate Money Managers without a shareholder vote. Appendix A to this Proxy Statement lists the current Money Managers for the Funds. The Money Managers will not change as a result of the Proposals that Shareholders are being asked to consider at the Special Meeting. THE PROPOSALS PROPOSAL 1: TO ELECT THREE MEMBERS OF THE BOARD OF TRUSTEES At their meeting held on May 20, 2003, the Trustees determined to present the election of three trustees who have not been previously elected by the Shareholders to hold office until their respective successors are elected and qualified. RIF currently has ten trustees, seven of whom have previously been elected by RIF's Shareholders. This Proposal 1 will not affect the status of these seven Trustees. Each of these Trustees, and, if elected, each of the nominees, will continue to hold office during the lifetime of RIF except as such Trustee sooner dies, resigns or is removed, as provided for in RIF's Master Trust Agreement. RIF also has two Trustees Emeritus. Trustees Emeritus do not have the power to vote on matters coming before the Board, or to direct the vote of any Trustee, and generally are not responsible or accountable in any way for the performance of the Board's responsibilities. In considering the nominees for election as Trustees of RIF, the Trustees took into account the qualifications of each nominee and the concern for the continued efficient conduct of RIF's business. In particular, the Trustees considered the requirements of the 1940 Act as they apply to the election of Trustees generally and the nominees in particular. RIF does not hold regular annual meetings. The Board may call special meetings of Shareholders for action by Shareholder vote as may be required by the 1940 Act or required or permitted by the Master Trust Agreement 4 and by-laws of RIF. In compliance with the 1940 Act, Shareholder meetings will be held to elect Trustees whenever fewer than a majority of the Trustees holding office have been elected by the Shareholders or, in the case of filling vacancies, to assure that at least two-thirds of the Trustees holding office after vacancies are filled have been elected by Shareholders. The Nominees The following information is provided for each nominee. It includes the nominee's name, principal occupation(s) or employment during the past five years, date of birth, address and directorships with other companies that file reports periodically with the SEC. Each nominee is currently a Trustee of RIF. Ms. Weston and Mr. Connealy are not "interested persons" of RIF as defined in Section 2(a)(19) of the 1940 Act. Mr. Phillips is an interested person of RIF by virtue of his employment by Frank Russell Company, the parent of FRIMCo. Each nominee currently oversees 37 funds in the Russell Fund complex. The Russell Fund complex consists of RIF and Frank Russell Investment Company ("FRIC"). The address for each nominee listed below is 909 A Street, Tacoma, Washington 98402-1616.
No. of Portfolios In Russell Term of Principal Fund Other Position(s) Office** and Occupation(s) Complex Directorships Name Held With Length of During the Overseen by Held by and Age Fund Time Served Past 5 Years Trustee Trustee ------- ----------- ------------ --------------------------------- ----------- ------------- NOMINEES Julie W. Weston,....... Trustee Since 2002 Retired since 2000. 1997 to 2000, 37 None Born October 2, 1943 Arbitrator, The American Arbitration Association Commercial Panel. From 1995 to 1999, Hearing Officer, University of Washington Michael J. A. Phillips, Trustee Since 2002 Chairman of the Board, President, 37 None Born January 20, 1948 CEO and Director, Frank Russell Company ("FRC") Daniel P. Connealy,.... Trustee Since April 2001-2003, Vice President and 37 Director, Born June 6, 1946 2003 Chief Financial Officer, Janus Gold Banc Capital Group Inc.; 1979-2001, Corporation, Audit and Accounting Partner, Inc. Pricewaterhouse- Coopers LLP
- -------- ** Each Trustee serves as a Trustee during the lifetime of RIF and until its termination except as such Trustee sooner dies, resigns or is removed. During the fiscal year ended December 31, 2002, there were four regular meetings of the Board, two special meetings of the Board and one telephonic meeting of the Board. All of the Trustees, including the nominees with respect to meetings held after their election to the Board by the Trustees, attended at least 75% of the meetings of the Board of Trustees held during that time. 5 The Board of Trustees has established a standing Audit Committee and a standing Nominating and Governance Committee. The Audit Committee's primary functions are: (1) oversight of the Funds' accounting and financial reporting policies and practices and their internal controls; (2) oversight of the quality and objectivity of the Funds' financial statements and the independent audit thereof; and (3) to act as liaison between the Funds' independent auditors and the full Board. It is management's responsibility to maintain appropriate systems for accounting and internal control and the auditor's responsibility to plan and carry out a proper audit. Currently, the Audit Committee members consist of Mmes. Kristianne Blake and Eleanor W. Palmer and Messrs. Raymond P. Tennison, Jr. and Daniel P. Connealy, each of whom is an independent Trustee. For the fiscal year ended December 31, 2002, the Audit Committee held five meetings. RIF's Board of Trustees has adopted and approved a formal written charter for the Audit Committee, which sets forth the Audit Committee's current responsibilities. The Audit Committee reviews the maintenance of the Funds' records and the safekeeping arrangements of RIF's custodian, reviews both the audit and non-audit work of RIF's independent auditors, submits a recommendation to the Board as to the selection of independent auditors, and pre-approves (i) all audit and non-audit services to be rendered by the auditors for RIF, (ii) all audit services provided to FRIMCo, or any affiliate thereof that provides ongoing services to RIF, relating to the operations and financial reporting of RIF, and (iii) all non-audit services relating to the operations and financial reporting of RIF, provided to FRIMCo, or any affiliate thereof that provides ongoing services to RIF, by any auditors with an ongoing relationship with RIF. The primary functions of the Nominating and Governance Committee are to: (1) nominate individuals who are not interested persons of RIF for independent Trustee membership on the Board; (2) evaluate and review the composition and performance of the Board; (3) review Board governance procedures; (4) review Trustee compensation; and (5) make nominations for membership on all Board committees and review the responsibilities of each committee. The Committee will not consider nominees recommended by Shareholders of the Funds. Currently, the Nominating and Governance Committee members consist of Messrs. Paul E. Anderson, William E. Baxter and Lee C. Gingrich and Ms. Julie W. Weston, each of whom is an independent Trustee. For the fiscal year ended December 31, 2002, the Nominating and Governance Committee held one meeting. 6 Information Regarding the Other Trustees and the Officers of RIF Listed below are the Trustees of RIF not named above as nominees and its principal executive officers, including their names, ages, position(s) with RIF, and principal occupation or employment during the past five years. An asterisk (*) indicates that the Trustee or officer is an "interested person" of RIF as defined in section 2(a)(19) of the 1940 Act. Mr. George F. Russell, Mr. Lynn L. Anderson and Mr. Michael J.A. Phillips are the only Trustees who are "interested persons" of RIF as defined in section 2(a)(19) of the 1940 Act. They are interested persons of RIF because of their relationships with FRIMCo or its affiliates as set forth in the table below. The address for each Trustee and officer listed below is 909 A Street, Tacoma, Washington 98402-1616.
No. of Portfolios in Russell Term of Principal Fund Other Position(s) Office** and Occupation(s) Complex Directorships Name Held With Length of During the Overseen by Held by and Age Fund Time Served Past 5 Years Trustee Trustee ------- ----------- ------------- ----------------------------------- ------------- ------------- INTERESTED TRUSTEE AND TRUSTEE EMERITUS *George F. Russell, Jr., Trustee Since 1999 Chairman Emeritus, FRC; 37 None Born July 3, 1932 Emeritus Chairman Emeritus, FRIC and RIF and Chairman Emeritus *Lynn L. Anderson,...... Trustee Trustee since Vice Chairman, FRC; Chairman of 37 Trustee, Born April 22, 1939 and 1987; the Board, Trustee, FRIC and RIF; SSgA Funds Chairman Chairman of CEO and Chairman of the Board, (investment of the the Board Russell Fund Distributors, Inc. and company) Board since 1999 FRIMCo; Trustee, President and Chairman of the Board, SSgA Funds (investment company); Trustee and Chairman of the Board, Frank Russell Trust Company; Director, Frank Russell Investments (Ireland) Limited and Frank Russell Investments (Cayman) Ltd.; Until October, 2002, President and CEO, FRIC and RIF INDEPENDENT TRUSTEES AND TRUSTEE EMERITUS Paul E. Anderson,....... Trustee Since 1984 1996 to present, President, 37 None Born October 15, 1931 Anderson Management Group LLC (private investments consulting) Paul Anton, Ph.D.,...... Trustee Since 2003 Retired since 1997; Trustee of 37 None Born December 1, 1919 Emeritus FRIC and RIF until 2002 William E. Baxter,...... Trustee Since 1984 Retired since 1986 37 None Born June 8, 1925
7
No. of Portfolios in Russell Term of Principal Fund Other Position(s) Office** and Occupation(s) Complex Directorships Name Held With Length of During the Overseen by Held by and Age Fund Time Served Past 5 Years Trustee Trustee ------- ----------- ------------ ---------------------------------- ------------- ------------- Kristianne Blake,........ Trustee Since 2000 President, Kristianne Gates Blake, 37 -- Trustee Born January 22, 1954 P.S. (accounting services) WM Group of Funds (investment company -- Director, Avista Corporation Lee C. Gingrich,......... Trustee Since 1984 Retired since 1995 37 None Born October 6, 1930 Eleanor W. Palmer,....... Trustee Since 1984 Retired since 1981 37 None Born May 5, 1926 Raymond P. Tennison, Jr., Trustee Since 2000 Currently, President, Simpson 37 None Born December 21, 1955 Investment Company and several additional subsidiary companies, including Simpson Timber Company, Simpson Paper Company and Simpson Tacoma Kraft Company
- -------- ** Each Trustee serves as a Trustee during the lifetime of RIF and until its termination except as such Trustee sooner dies, resigns or is removed. Dr. Anton was appointed Trustee Emeritus by the Board effective December 31, 2002 for a term not to exceed five years. Mr. Russell was appointed Trustee Emeritus by the Board effective January 1, 1999 to serve until his death, retirement, resignation or removal. 8
Term of Principal Position(s) Office** and Occupation(s) Name Held With Length of During the and Age Fund Time Served Past 5 Years ------- ------------------------ ------------------------ ------------------------ OFFICERS Leonard P. Brennan,...... President and Chief Since 2002 Director, President and Born October 11, 1959 Executive Officer CEO, FRIMCo; From 1995 to present, Managing Director Individual Investor Services of Frank Russell Company Mark E. Swanson,......... Treasurer and Chief Since 1998 1998 to present, Born November 26, 1963 Accounting Officer Treasurer and Chief Accounting Officer, FRIC and RIF; Director, Funds Administration, FRIMCo and Frank Russell Trust Company; Treasurer, SSgA Funds (investment company); Manager, Funds Accounting and Taxes, Russell Fund Distributors, Inc. From April 1996 to August 1998, Assistant Treasurer, FRIC. From August 1996 to August 1998, Assistant Treasurer, FRIC and RIF. November 1995 to July 1998, Assistant Secretary, SSgA Funds. February 1997 to July 1998, Manager, Funds Accounting and Taxes, FRIMCo Randall P. Lert, Born.... Director of Since 1991 Director of Investments, October 3, 1953 Investments FRIC and RIF; Chief Investment Officer, FRC and Frank Russell Trust Company; Director, FRIMCo and Russell Fund Distributors, Inc. Karl J. Ege,............. Secretary and General Since 1994 Secretary and General Born October 8, 1941 Counsel Counsel, FRC, FRIC, RIF, FRIMCo, Frank Russell Trust Company, Russell Fund Distributors, Inc. and Frank Russell Capital Inc. Mark D. Amberson,........ Director of Short-Term Since 2001 Director of Short-Term Born July 20, 1960 Investment Funds Investment Funds, FRIC, RIF, FRIMCo and Frank Russell Trust Company. From 1991 to 2001, Portfolio Manager, FRIC, RIF, FRIMCo and Frank Russell Trust Company
- -------- ** All officers serve for one year and until their successors are duly elected and qualified; provided, however, that any officer may be removed at any time either with or without cause, by the Board. 9 Trustee Ownership of Fund Shares The table below sets forth the dollar range of the value of the shares of each Fund, and the dollar range of the aggregate value of the shares of all funds in the Russell Fund Complex, owned directly or beneficially by the Trustees, including the nominees, as of December 31, 2002. The Russell Fund Complex consists of RIF and FRIC. EQUITY SECURITIES BENEFICIALLY OWNED BY TRUSTEES FOR THE CALENDAR YEAR ENDED DECEMBER 31, 2002
Dollar Range of Equity Aggregate Dollar Range of Equity Securities in all Securities in Each Registered Investment Companies Overseen by Trustee Fund Trustees in Russell Fund Complex ------- ---------------------- -------------------------------------------------- George F. Russell, Jr... None None Michael J. A. Phillips.. None None Lynn L. Anderson........ None None Paul E. Anderson........ None Over $100,000 Paul Anton, Ph.D........ None $50,001-$100,000 William E. Baxter....... None $1-$10,000 Kristianne Blake........ None Over $100,000 Daniel P. Connealy...... None None Lee C. Gingrich......... None None Eleanor W. Palmer....... None None Raymond P. Tennison, Jr. None None Julie W. Weston......... None $1-$10,000
10 Remuneration of Trustees RIF pays fees only to the independent Trustees. Compensation of officers and Trustees who are "interested persons" of RIF is paid by FRIMCo or its affiliates. The following represents the compensation paid to each Trustee for the fiscal year ended December 31, 2002. The "Russell Fund Complex" consists of FRIC and RIF. TRUSTEE COMPENSATION TABLE FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002
Pension or Retirement Estimated Total Benefits Annual Compensation Aggregate Accrued as Benefits From Russell Compensation Part of Upon Fund Complex Trustee from RIF RIF Expenses Retirement Paid to Trustees ------- ------------ ------------ ---------- ---------------- Lynn L. Anderson......... $ 0 $0 $0 $ 0 Paul E. Anderson......... $12,530 $0 $0 $ 85,250 Paul Anton, PhD.*........ $11,760 $0 $0 $ 78,250 William E. Baxter........ $11,760 $0 $0 $ 81,750 Kristianne Blake......... $12,677 $0 $0 $ 86,800 Daniel P. Connealy**..... $ 0 $0 $0 $ 0 Lee C. Gingrich.......... $12,390 $0 $0 $ 86,250 Eleanor W. Palmer........ $11,974 $0 $0 $ 83,280 Michael J. A. Phillips... $ 0 $0 $0 $ $0 Raymond P. Tennison, Jr.. $12,040 $0 $0 $81,750.09 George F. Russell, Jr.*** $ 0 $0 $0 $ $0 Julie W. Weston****...... $ 4,327 $0 $0 $ $31,333
- -------- * Dr. Anton was elected Trustee Emeritus effective December 31, 2002. ** Mr. Connealy was elected to the Board of Trustees on April 24, 2003. *** Mr. Russell was elected Trustee Emeritus effective January 1, 1999. **** Ms. Weston was elected to the Board of Trustees on August 19, 2002. The Russell Fund Complex currently pays each of the independent Trustees a retainer of $52,000 per year, $5,000 for each regular quarterly meeting attended in person, $2,000 for each special meeting attended in person, and $2,000 for each Joint Audit Committee meeting or Nominating and Governance Committee meeting attended in person. The Trustees receive a $500 fee for attending an in-person meeting by phone instead of receiving the full fee had the member attended in person. Out of pocket expenses are also paid by the Fund Complex. The Lead Trustee is paid a fee of $10,000 per year, and each Committee Chair is paid a fee of $6,000 per year. The Russell Fund Complex pays each independent Trustee Emeritus an annual retainer equal to 80% of the annual retainer for independent Trustees in effect at the time such person is elected Trustee Emeritus. Required vote The persons named on the proxy card intend, in the absence of contrary instructions, to vote all proxies in favor of the election of the nominees. A Shareholder or Contractowner providing voting instructions may vote for or withhold authority with respect to any or all of the nominees. If an executed proxy card or voting instruction card is received without voting instructions, the shares will be voted for each of the nominees named herein. The nominees have consented to being named in this Proxy Statement and to serve if elected. RIF knows of no reason why the nominees would be unable or unwilling to serve if elected. Should any of the nominees become unable or unwilling to accept nomination or election prior to the Special Meeting, the persons named on the proxy card will exercise their voting power to vote for such substitute person or persons as the current Trustees of RIF may recommend. 11 RIF's Master Trust Agreement requires that the Trustees be elected by a "plurality" vote. Therefore, the three nominees who receive the greatest number of affirmative votes cast by the Shareholders of RIF who are present at the Special Meeting in person or by proxy will be declared elected, provided that there is a sufficient number of shares represented in person or by proxy to meet the quorum requirements set forth in RIF's Master Trust Agreement. THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND THAT THE SHAREHOLDERS OF EACH FUND AND CONTRACTOWNERS PROVIDING VOTING INSTRUCTIONS VOTE "FOR" THE ELECTION OF EACH OF THE THREE NOMINEES TO SERVE ON THE BOARD OF TRUSTEES AS DESCRIBED IN PROPOSAL 1. ANY EXECUTED UNMARKED PROXY CARDS AND VOTING INSTRUCTION CARDS THAT ARE RETURNED ON A TIMELY BASIS WILL BE SO VOTED. PROPOSALS 2(a)-2(e): APPROVAL OF A CHANGE TO THE INVESTMENT OBJECTIVES OF THE FUNDS Pursuant to the 1940 Act, each of the Funds has adopted and operates according to a stated investment objective. The investment policies, restrictions, strategies and activities of each Fund are guided by, and designed to achieve, the Fund's stated investment objective. Each Fund is subject to an investment objective that currently is a fundamental investment restriction, meaning that it may not be changed without Shareholder approval. These investment objectives were established at the inception of the Funds and reflected market conditions and circumstances at that time and the manner in which FRIMCo then wished to conduct the Funds' investment programs. In many cases, market conditions and circumstances have changed since the Funds' inceptions and are expected to continue to change. The proposed changes are designed to clarify the investment objectives and, by doing so, avoid possible investor confusion, facilitate the efforts of FRIMCo to conduct the investment programs of the Funds and reduce administrative burdens associated with clarifying the meaning of and monitoring compliance with the current investment objectives. In addition, clarification of the investment objectives of the Funds may facilitate the marketing of the Funds. In such event, Shareholders could benefit from the economies of scale resulting from increases in the Funds' total assets and consequent decreases in their expense ratios. The changes proposed in the investment objectives for the affected Funds are not expected to affect materially the manner in which such Funds are managed. The current and proposed objectives for the Funds The current and proposed investment objectives for the Funds are set forth in the chart below:
Proposal Fund Current Investment Objective Proposed Investment Objective - -------- ---- ---------------------------- ----------------------------- 2(a) Multi-Style To provide income and capital growth Seeks to provide long term capital Equity by investing principally in equity growth. securities. 2(b) Aggressive To provide capital appreciation by Seeks to provide long term capital Equity assuming a higher level of volatility growth. than is ordinarily expected from the Multi-Style Equity Fund by investing in equity securities.
12
Proposal Fund Current Investment Objective Proposed Investment Objective - -------- ---- ---------------------------- ----------------------------- 2(c) Non-US To provide favorable total return and Seeks to provide long term capital additional diversification for US growth. investors by investing primarily in equity and fixed-income securities of non-US companies and securities issued by non-US governments. 2(d) Real Estate To generate a high level of total return Seeks to provide current income and Securities through above average current income long term capital growth. while maintaining the potential for capital appreciation. 2(e) Core Bond To maximize total return through Seeks to provide current income and capital appreciation and income by the preservation of capital. assuming a level of volatility consistent with the broad fixed- income market by investing in fixed- income securities.
Shareholders of each Fund are being asked to approve a reclassification of the Fund's investment objectives from "fundamental" to "non-fundamental" in Proposal 3, described below. If Shareholders approve Proposal 3, each of the amended investment objectives that are approved pursuant to Proposals 2(a) through 2(e) will be non-fundamental investment objectives. None of Proposals 2(a) through 2(e) is contingent upon approval of Proposal 3 by Shareholders of the subject Fund or upon approval of this Proposal 2 by the other Funds. Approval of Proposal 3 by the Shareholders of any Fund is likewise not contingent upon approval of its corresponding Proposal 2. Required vote The approval of the amended investment objective of each Fund requires the approval of a majority of the outstanding voting securities of that Fund. The vote of a majority of the outstanding voting securities of a Fund means the vote of the lesser of (a) 67% or more of the voting securities of the Fund present at the meeting, if the holders of more than 50% of the outstanding voting securities of the Fund are present or represented by proxy; or (b) more than 50% of the outstanding voting securities of the Fund. Shareholders of each Fund will vote separately on their respective Proposal, as applicable. The investment objective applicable to each Fund will be changed only if approved by the Shareholders of that Fund. THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND THAT THE SHAREHOLDERS OF EACH FUND AND CONTRACTOWNERS PROVIDING VOTING INSTRUCTIONS VOTE "FOR" PROPOSALS 2(a) - 2(e) AS APPLICABLE. ANY EXECUTED UNMARKED PROXY CARDS AND VOTING INSTRUCTION CARDS THAT ARE RETURNED ON A TIMELY BASIS WILL BE SO VOTED. PROPOSAL 3: APPROVAL OF A RECLASSIFICATION OF THE INVESTMENT OBJECTIVES OF EACH FUND FROM FUNDAMENTAL TO NON-FUNDAMENTAL The investment objective for each Fund is a "fundamental" investment policy, meaning that it may not be changed without Shareholder approval. The Funds' investment objectives are not required to be fundamental, and FRIMCo has proposed to the Board that the investment objective for each Fund be reclassified from fundamental 13 to non-fundamental. As a non-fundamental investment policy, each investment objective could be changed by the Trustees without Shareholder approval if the Trustees deem the change to be in the best interests of Shareholders. FRIMCo has proposed these changes in order to provide additional flexibility to conduct the investment program of each Fund in response to changing market conditions and circumstances consistent with applicable laws in effect from time to time, without the expense and delay associated with arranging for a Shareholder meeting to approve changes in the Fund's investment objective. The Board does not expect to use this flexibility frequently. However, the Trustees would be in a position to change the investment objective of any Fund in circumstances when a change, in the Board's judgment, would be in the best interests of the Fund's Shareholders. Such circumstances would include changes in the securities markets generally that would render achievement of the Fund's then current investment objective more difficult on an ongoing basis or changes with respect to the Fund specifically. If the Board did decide to make such a change to any non-fundamental investment objective, the Fund would provide Shareholders with 60 days' notice before the effective date of such change. The current fundamental investment objectives for each Fund, to which Shareholders are being asked to approve changes, are set forth above in Proposals 2(a) through 2(e). If the Shareholders of a Fund approve the proposal to reclassify its investment objective from fundamental to non-fundamental, the Board thereafter would be permitted to change the investment objective for such Fund, if appropriate to do so in its judgment, without the delay and expense of the Fund arranging for Shareholder approval. If these Funds' investment objectives remain fundamental and the Board determined that it was in the best interests of Shareholders to change an investment objective, each such Fund would be required to hold a Shareholder meeting at which such change would be voted upon, and to prepare and send a proxy statement to Shareholders seeking their instructions as to how to vote shares at such meeting. Obtaining Shareholder approval to change the Funds' investment objectives is likely to involve significant delays and costs. The table below summarizes the effects of reclassifying each investment objective from fundamental to non-fundamental.
Fundamental Investment Non-Fundamental Investment Objective Objective ---------------------------------- ------------------------------------ Who must approve changes in a Board and Shareholders Board fundamental investment objective? How quickly can a change to the Relatively slowly, since a vote of Relatively quickly, because the investment objective be made? Shareholders is required change can be accomplished by action of the Board alone, provided that Shareholders are provided 60 days' prior notice that their Fund's objective is being changed What is the relative cost to change an Costly to change because a Less costly to change because a investment objective? Shareholder vote requires holding change can be accomplished by a meeting of Shareholders with action of the Board of Trustees additional SEC filing requirements without Shareholder approval and proxy solicitation efforts
Shareholders of each Fund are being asked to approve a change of each Fund's investment objectives in Proposal 2, described above. If Shareholders approve Proposals 2 and 3, each of the amended investment objectives that are approved pursuant to Proposals 2(a) through 2(e) will be non-fundamental investment objectives. Proposal 3 is not contingent upon approval of Proposal 2 by Shareholders of the subject Fund or upon approval of this Proposal 3 by the other Funds. Approval of Proposal 2 by the Shareholders of any Fund is likewise not contingent upon approval of its corresponding Proposal 3. 14 Required vote The approval of the reclassification of the investment objective of each Fund from fundamental to non-fundamental requires the approval of a majority of the outstanding voting securities of that Fund. The vote of a majority of the outstanding voting securities of a Fund means the vote of the lesser of (a) 67% or more of the voting securities of the Fund present at the meeting, if the holders of more than 50% of the outstanding voting securities of the Fund are present or represented by proxy; or (b) more than 50% of the outstanding voting securities of the Fund. Shareholders of each Fund will vote separately on Proposal 3. The investment objective applicable to each Fund will be reclassified only if approved by the Shareholders of that Fund. THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND THAT THE SHAREHOLDERS OF EACH FUND AND CONTRACTOWNERS PROVIDING VOTING INSTRUCTIONS VOTE "FOR" PROPOSAL 3. ANY EXECUTED UNMARKED PROXY CARDS AND VOTING INSTRUCTION CARDS THAT ARE RETURNED ON A TIMELY BASIS WILL BE SO VOTED. OTHER BUSINESS The Trustees know of no other business to be presented at the Special Meeting other than Proposals 1 through 3, and do not intend to bring any other matters before the Special Meeting. However, if any additional matters should be properly presented, proxies will be voted in the discretion of the persons named as proxies. INFORMATION ABOUT RIF Investment Advisor, Administrator and Transfer Agent FRIMCo provides or oversees the provision of all general management and administration, investment advisory and portfolio management services for the Funds and acts as transfer agent for the Funds. FRIMCo develops the investment program for each of the Funds, selects Money Managers for the Funds (subject to approval by the Board), allocates assets among Money Managers, monitors the Money Managers' investment programs and results, and may exercise investment discretion over certain assets. FRIMCo's mailing address is 909 A Street, Tacoma, Washington 98402. Unlike most investment companies that have a single organization that acts as both administrator and investment advisor, the Funds divide responsibility for corporate management and investment advice between FRIMCo and a number of different Money Managers. A list of the Money Managers and their addresses is provided in Appendix A to this proxy statement. Distributor Russell Fund Distributors, Inc. (the "Distributor") serves as the distributor of RIF's shares. The Distributor receives no compensation from RIF for its services. The Distributor is a wholly owned subsidiary of FRIMCo and its mailing address is 909 A Street, Tacoma, WA 98402. Custodian RIF's custodian is State Street Bank and Trust Company and its mailing address is 1776 Heritage Drive, North Quincy, MA 02171. Independent Auditors Upon the recommendation of the Audit Committee, the Board selected the firm of PricewaterhouseCoopers LLP ("PwC") as independent auditors of RIF for the fiscal year ending December 31, 2003. 15 Audit Fees. The aggregate fees billed by PwC for professional services rendered for the audit of RIF's annual financial statements for the fiscal years ended December 31, 2001 and 2002 were $77,812 and $74,168, respectively. Audit-Related Fees. PwC billed no aggregate fees for assurance and related services rendered that are reasonably related to the audit of RIF's annual financial statements but not reported under "Audit-Fees" above for the fiscal years ended December 31, 2001 and 2002. Tax Fees. The aggregate fees billed by PwC for professional services rendered for tax compliance, tax advice and tax planning for the fiscal years ended December 31, 2001 and 2002 were $82,886 and $27,033, respectively. All Other Fees. The aggregate fees billed by PwC for professional services rendered for products and services other than those described above for the fiscal years ended December 31, 2001 and 2002 were $5,300 and $0, respectively. Substantially all of these services were rendered in connection with the issuance of consent letters related to filings by RIF with the Securities and Exchange Commission. The Audit Committee has considered whether the services described above are compatible with PwC's independence. The Audit Committee has also considered whether the provision of all other non-audit services rendered to FRIMCo, or an affiliate thereof that provides ongoing services to RIF, is compatible with maintaining PwC's independence. The Audit Committee has adopted pre-approval policies and procedures pursuant to which the engagement of any accountant is approved. Such procedures provide that [to be completed when procedures are completed]. The Audit Committee is informed of each such engagement in a timely manner, and such procedures do not include delegation of the Audit Committee's responsibilities to management. Pre-approval has not been waived in respect of services described under "Audit-Related Fees," "Tax Fees" or "All Other Fees" since the date on which the aforementioned pre-approval procedures were adopted by the Audit Committee. The aggregate non-audit fees billed by PwC for services rendered to RIF and to FRIMCo, or an affiliate thereof that provides ongoing services to RIF, for the fiscal years ended December 31, 2001 and 2002 were $330,697 and $210,258, respectively. Representatives of PwC are not expected to be present at the Special Meeting, but will be given the opportunity to make a statement if they so desire and will be available should any matter arise requiring their presence. Massachusetts State Law Considerations RIF is an entity of the type commonly known as a "Massachusetts business trust." Under Massachusetts law, shareholders of such a trust may, under certain circumstances, be held personally liable as partners for its obligations. However, the Master Trust Agreement of RIF contains an express disclaimer of Shareholder liability for acts or obligations of RIF and provides for indemnification and reimbursement of expenses out of RIF's property for any Shareholder held personally liable for the obligations of RIF. The Master Trust Agreement also provides that RIF may maintain appropriate insurance (for example, fidelity bonding and errors and omissions insurance) for the protection of RIF, the Shareholders of the sub-trusts, Trustees, officers, employees and agents covering possible tort and other liabilities. Thus, the risk that a Shareholder would incur financial loss on account of Shareholder liability also is limited to circumstances in which both inadequate insurance exists and RIF itself is unable to meet its obligations. Under Massachusetts law, RIF is not required to hold annual meetings. In the past, the Funds have availed themselves of these provisions of state law to achieve cost savings by eliminating printing costs, mailing charges 16 and other expenses involved to hold routine annual meetings. The Funds may, however, hold a meeting for such purposes as changing fundamental investment restrictions, approving a new investment management agreement or any other matters which are required to be acted on by Shareholders under the 1940 Act. In addition, a meeting also may be called by Shareholders holding at least 10% of the shares entitled to vote at the meeting for the purpose of voting upon the removal of Trustees, in which case Shareholders may receive assistance in communicating with other Shareholders as provided in Section 16(c) of the 1940 Act. RIF is holding the Special Meeting because of the items that must be presented for Shareholders' consideration and approval. FURTHER INFORMATION ABOUT VOTING AND THE SPECIAL MEETING This Proxy Statement is provided on behalf of the Board in connection with the Special Meeting of RIF to be held at the offices of RIF at 909 A Street, Tacoma, Washington 98402, on October 3, 2003, at a.m., local time, and any or all adjournments thereof. This Proxy Statement is first being mailed to Shareholders on or about July , 2003. Contractowners may revoke their voting instructions at any time prior to 4:00 p.m. Eastern time on [DATE] by submitting written notice of revocation, a later-dated instruction card or a later-dated instruction via facsimile, telephone or the Internet. RIF requests that Participating Insurance Companies forward proxy material to Contractowners. RIF may reimburse such Participating Insurance Companies for their reasonable expenses incurred in connection with the solicitation of voting instructions. The cost of soliciting these proxies will be borne by each Fund, to the extent of its direct operational expenses, and by FRIMCo. Employees of RIF or FRIMCo may solicit voting instructions from Contractowners for no additional remuneration. Record Date Shareholders of record at the close of business on the Record Date, July 7, 2003, are entitled to be present and to vote at the Special Meeting or any adjournment of the Special Meeting. Each share of record is entitled to one vote on each matter presented at the Special Meeting, with proportionate votes for fractional shares. Shares Outstanding As of June 30, 2003, there were the following number of shares of beneficial interest outstanding of each Fund: Number of Shares Name of Fund Outstanding ------------ ----------- Multi-Style Equity Fund Aggressive Equity Fund Non-US Fund Real Estate Securities Fund Core Bond Fund Quorum The Master Trust Agreement provides that a quorum shall be present at a meeting when a majority of the shares entitled to vote is present at the meeting, but any lesser number shall be sufficient for adjournments. In the event that a quorum is not present at the Special Meeting or sufficient votes to approve a Proposal are not received, the persons named as proxies may propose one or more adjournments of the Special Meeting to permit further solicitation of proxies. A Shareholder vote may be taken on any other matter to properly come before the Special Meeting prior to such adjournment if sufficient votes to approve such matters have been received and such vote is otherwise appropriate. Any adjournment of the Special Meeting will require the affirmative vote of a majority of those shares present at the Special Meeting or represented by proxy and voting. The persons named 17 as proxies on the proxy card will vote against any such adjournment those proxies required to be voted against such Proposal. They will vote in favor of an adjournment all other proxies that they are entitled to vote. The costs of any such additional solicitation and of any adjourned session will be borne by RIF. Abstentions and 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 brokers or nominees do not have discretionary power) will be counted as shares that are present for purposes of determining the presence of a quorum, but which have not been voted. Abstentions and broker non-votes will not be counted in favor of, but will have no other effect on, Proposal 1, and will have the effect of a "no" vote on all other Proposals. Accordingly, Shareholders are urged to forward their voting instructions promptly. Beneficial Owners [As of May 31, 2003, the officers and Trustees, including the nominees, of RIF as a group beneficially owned less than 1% of the shares of each Fund outstanding on such date.] As of June 30, 2003, to the best of RIF's knowledge, no person owned beneficially more than 5% of any Fund, except as set forth in Appendix B. As of the Record Date, the Participating Insurance Companies are The Northwestern Mutual Life Insurance Company ("Northwestern Mutual"), First MetLife Investors Insurance Company, MetLife Investors Insurance Company of California, MetLife Investors Insurance Company, Hartford Life Insurance Company, General American Life Insurance Company and Security Equity Life Insurance Company. Northwestern Mutual is an affiliate of FRIMCo and the Distributor. RIF has been advised by Northwestern Mutual that all shares of a Fund held in its general account will be represented at the Special Meeting by Northwestern Mutual and voted in the same proportion as the aggregate of the votes cast with respect to shares of such Fund held in all of Northwestern Mutual's 1940 Act Separate Accounts. Shareholder Proposals RIF is not required, and does not intend, to hold regular annual meetings of Shareholders. Shareholders wishing to submit proposals for consideration for inclusion in a proxy statement for the next meeting of Shareholders should send their written proposals to RIF's offices, 909 A Street, Tacoma, Washington 98402, Attn: Secretary, so they are received within a reasonable time before any such meeting. The Trustees know of no business, other than the matters mentioned in the Notice and described above, that is expected to come before the Special Meeting. Should any other matter requiring a vote of Shareholders arise, including any question as to an adjournment or postponement of the Special Meeting, the persons named as proxies will vote on such matters according to their best judgment in the interests of RIF. Annual and Semi-Annual Reports The Funds' most recent audited financial statements and Annual Report, for the fiscal year ended December 31, 2002, has been previously mailed to Shareholders, and is available free of charge. If you have not received an Annual Report for the Fund(s) in which you are an investor, or would like to receive additional copies, free of charge, please contact your Participating Insurance Company or contact RIF by mailing a request to Russell Investment Funds, 909 A Street, Tacoma, WA 98402, calling 1-800-787-7354, faxing 253-591-3495, or logging onto www.russell.com. By Order of the Trustees, Karl J. Ege Secretary 18 APPENDIX A The following is a list of names and addresses of the Money Managers for the Funds. The Money Managers have no affiliations with the Funds or the Funds' service providers other than their management of Fund assets. These managers may also serve as Money Managers or advisers to other investment companies unaffiliated with RIF, other Funds in RIF, or to other clients of FRIMCo or of Frank Russell Company, including Frank Russell Company's wholly-owned subsidiary, Frank Russell Trust Company. Multi-Style Equity Fund Alliance Capital Management L.P., through its Bernstein Investment Research and Management Unit, 1345 Avenue of the Americas, New York, NY 10105. Barclays Global Investors, N.A., 45 Fremont Street, San Francisco, CA 94105. Brandywine Asset Management, LLC, 201 North Walnut Street, Suite 1200, Wilmington, DE 19801. Jacobs Levy Equity Management, Inc., 100 Campus Drive, P.O. Box 650, Florham Park, NJ 07932-0650. Montag & Caldwell, Inc., 3455 Peachtree Road, N.E., Suite 1200, Atlanta, GA 30326-3248. Strong Capital Management, Inc., 100 Heritage Reserve, P.O. Box 2936, Menomonee Falls, WI 53201. Turner Investment Partners, Inc., 1205 Westlakes Drive, Suite 100, Berwyn, PA 19312-2414. Westpeak Global Advisors, L.P., 1470 Walnut Street, Boulder, CO 80302. Aggressive Equity Fund CapitalWorks Investment Partners, LLC, 402 West Broadway, 25th Floor, San Diego, CA 92101. David J. Greene and Company, LLC, 599 Lexington Avenue, New York, NY 10022. Geewax, Terker & Company, 414 Old Baltimore Pike, Chadds Ford, PA 19317. Goldman Sachs Asset Management, L.P., 32 Old Slip, 17th Floor, New York, NY 10005. Jacobs Levy Equity Management, Inc., 100 Campus Drive, P.O. Box 650, Florham Park, NJ 07932-0650. Suffolk Capital Management, LLC, 1633 Broadway, 40th Floor, New York, NY 10019. Systematic Financial Management, L.P., 300 Frank Burr Boulevard, Glenpointe East, 7th Floor, Teaneck, NJ 07666-6703. TimesSquare Capital Management, Inc., Four Times Square, 25th Floor, New York, NY 10036-9998. Non-U.S. Fund AQR Capital Management, LLC, 900 Third Avenue, 17th Floor, New York, NY 10022. A-1 Fidelity Management & Research Company, 82 Devonshire Street, Boston, MA 02109-3614. Oechsle International Advisors, LLC, One International Place, 23rd Floor, Boston, MA 02110. The Boston Company Asset Management, LLC, One Boston Place, 14th Floor, Boston, MA 02108-4402. Real Estate Securities Fund AEW Management and Advisors, L.P., World Trade Center East, Two Seaport Lane, Boston, MA 02110-2021. INVESCO Realty Advisors, a division of INVESCO Institutional (N.A.), Inc., One Lincoln Center, Suite 700, 540 LBJ Freeway - LB2, Dallas, TX 75240. RREEF America L.L.C., 875 North Michigan Avenue, 41st Floor, Chicago, IL 60611-1901. Core Bond Fund Pacific Investment Management Company LLC, 840 Newport Center Drive, Suite 300, P.O. Box 6430, Newport Beach, CA 92658-6430. TimesSquare Capital Management, Inc., Four Times Square, 25th Floor, New York, NY 10036-9998. A-2 APPENDIX B
Name and Address of Amount and Nature of Fund Beneficial Owner Beneficial Ownership Percentage Owned - ------------------------ ------------------------ ------------------------ ------------------------
B-1 PROXY CARD PROXY CARD RUSSELL INVESTMENT FUNDS SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 3, 2003 The undersigned having received Notice of the Special Meeting of Shareholders of Russell Investment Funds ("RIF") to be held on October 3, 2003, at __:__, Pacific Time, at the offices of RIF located at 909 A Street, Tacoma, Washington and the related proxy statement, and hereby revoking all Proxies heretofore given with respect to shares to be voted at this Special Meeting, hereby appoints each of David Craig, Greg Lyons, Mary Beth Rhoden and Mark Swanson, or any of them, as Proxies of the undersigned with power to act without the others and with full power of substitution, to vote on behalf of the undersigned as indicated on this proxy card all of the shares in the funds of RIF which the undersigned is entitled to vote at the Special Meeting and at any adjournment or postponement thereof, as fully as the undersigned would be entitled to vote if personally present. This Proxy is solicited on behalf of RIF's Board of Trustees. Shares will be voted as you specify. The Board of Trustees of RIF recommends that you vote FOR each proposal. If this proxy card is signed, dated and returned with no choice indicated as to one or more proposals on which shares represented by this proxy card are entitled to be voted, such shares shall be voted FOR each such proposal. The Proxies are authorized in their discretion to transact such other business as may properly come before the Special Meeting or any adjournment or postponement thereof. If you vote via facsimile, do not return this proxy card. VOTE VIA FACSIMILE: 1-888-796-9932 Note: Please sign exactly as your name appears on this Proxy card and date. If signing for estates, trusts or corporations, title or capacity should be stated. If shares are held jointly, each holder should sign. _______________________________________ Signature _______________________________________ Signature (if held jointly) _______________________________________ Date RIF_13381 FUND FUND FUND - ---- ---- ---- Aggressive Equity Fund Core Bond Fund Multi-Style Equity Fund Non-U.S. Fund Real Estate Securities Fund Please vote by filling in the appropriate box below. If you do not mark one or more proposals your Proxy will be voted FOR each such proposal. PLEASE MARK BOXES BELOW IN BLUE OR BLACK INK AS FOLLOWS. EXAMPLE: [X] - --------------------------------------------------------------------------- [_] To vote FOR all Funds on all Proposals mark this box. (No other vote is necessary.) - --------------------------------------------------------------------------- 1. Elect three members of the Board of Trustees of RIF: FOR WITHHOLD FOR ALL ALL ALL EXCEPT Nominee: 01. Julie W. Weston [_] [_] [_] 02. Michael J.A. Phillips 03. Daniel P. Connealy
Instruction: To withhold authority to vote for any individual nominee, mark the "For All Except" box and write the number and name of any such nominee on the line immediately below. ______________________________________ 2. Approve a change to the fundamental investment objective: FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN Aggressive Equity Fund [_] [_] [_] Core Bond Fund [_] [_] [_] Multi-Style Fund [_] [_] [_] Non-U.S. Fund [_] [_] [_] Real Estate Securities Fund [_] [_] [_]
3. Approve the reclassification of the investment objective from "fundamental" to "non-fundamental": FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN Aggressive Equity Fund [_] [_] [_] Core Bond Fund [_] [_] [_] Multi-Style Fund [_] [_] [_] Non-U.S. Fund [_] [_] [_] Real Estate Securities Fund [_] [_] [_]
EVERY SHAREHOLDER'S VOTE IS IMPORTANT! PLEASE SIGN, DATE AND RETURN YOUR PROXY CARD TODAY! VOTING INSTRUCTION CARD RUSSELL INVESTMENT FUNDS VOTING INSTRUCTION CARD SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 3, 2003 [NAME OF INSURANCE COMPANY] The undersigned, revoking all voting instructions heretofore given with respect to shares to be voted at the Special Meeting of Shareholders of Russell Investment Funds ("RIF") to be held on October 3, 2003 at __:__, Pacific Time, at the offices of RIF located at 909 A Street, Tacoma, Washington, hereby instructs all shares of RIF deemed attributable to the undersigned's contract or policy with the issuing insurance company named above be voted as indicated on the Voting Instruction Card at the Special Meeting and at any adjournment or postponement thereof. The issuing insurance company named above and any proxies appointed by it are authorized in their discretion to transact such other business as may properly come before the Special Meeting or any adjournment or postponement thereof. Voting Instructions are solicited by the issuing insurance company named above on behalf of RIF's Board of Trustees. Shares will be voted as you specify. The Board of Trustees of RIF recommends that you vote FOR each proposal. If this Voting Instruction Card is signed, dated and returned with no choice indicated as to one or more proposals on which shares represented by the undersigned's contract or policy are entitled to be voted, such shares shall be voted FOR each such proposal. If you vote via telephone, facsimile or the Internet, do not return this Voting Instruction Card. VOTE VIA FACSIMILE: 1- 888 - 796 - 9932 VOTE VIA TELEPHONE: 1-866-235-4258 VOTE VIA THE INTERNET: https://vote.proxy-direct.com ---------------------------------------------------- CONTROL NUMBER: 999 9999 9999 999 ---------------------------------------------------- Note: Please sign exactly as your name appears on this Voting Instruction Card and date. If signing for estates, trusts or corporations, title or capacity should be stated. If shares are held jointly, each holder should sign. ____________________________________________________ Signature ____________________________________________________ Signature (if held jointly) ____________________________________________________ Date RIF_13381 FUND FUND FUND - ---- ---- ---- Aggressive Equity Fund Core Bond Fund Multi-Style Equity Fund Non-U.S. Fund Real Estate Securities Fund Please provide voting instructions by filling in the appropriate box below. If you do not mark one or more proposals, the shares attributable to your contract or policy will be voted FOR each such proposal. PLEASE MARK YOUR VOTES AS IN THIS SAMPLE. EXAMPLE: [X] - --------------------------------------------------------------------------- [_] To vote FOR all Funds on all Proposals mark this box. (No other vote is necessary.) - --------------------------------------------------------------------------- 1. Elect three members of the Board of Trustees of RIF: FOR WITHHOLD FOR ALL ALL ALL EXCEPT Nominee: 01 Julie W. Weston 02 Michael J.A. Phillips [_] [_] [_] 03 Daniel P. Connealy
Instruction: To withhold authority to vote for any individual nominee, mark "For All Except" and write the number and name of any such nominee on the line immediately below. _______________________________________ 2. Approve a change to the fundamental investment objective: FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN Aggressive Equity Fund [_] [_] [_] Core Bond Fund [_] [_] [_] Multi-Style Fund [_] [_] [_] Non-U.S. Fund [_] [_] [_] Real Estate Securities Fund [_] [_] [_]
3. Approve the reclassification of the investment objective from "fundamental" to "non-fundamental": FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN Aggressive Equity Fund [_] [_] [_] Core Bond Fund [_] [_] [_] Multi-Style Fund [_] [_] [_] Non-U.S. Fund [_] [_] [_] Real Estate Securities Fund [_] [_] [_]
YOUR VOTING INSTRUCTIONS ARE IMPORTANT! PLEASE SIGN, DATE AND RETURN YOUR VOTING INSTRUCTION CARD TODAY. -----END PRIVACY-ENHANCED MESSAGE-----