| UNITED STATES |
| SECURITIES AND EXCHANGE COMMISSION |
| Washington, D.C. 20549 |
| SCHEDULE 14A |
| Proxy Statement Pursuant to Section 14(a) of |
| the Securities Exchange Act of 1934 (Amendment No.) |
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| [ ] | Definitive Proxy Statement |
| [ ] | Definitive Additional Materials |
| [ ] | Soliciting Material Pursuant to §240.14a-12 |
| (Name of Registrant as Specified In Its Charter) |
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| Rydex Variable Trust |
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Rydex Variable Trust
9601 Blackwell Road,
805 King Farm Boulevard, Suite 500
600
Rockville, MD 20850
March 1, 2010
21, 2011
Dear Contract Holder/Plan Participant:
Holder:
The Board of Trustees (the "Board"“Board”) of Rydex Variable Trust has called a special meeting of shareholders of Multi-Cap Core EquityInternational Long Short Select Fund (the "Fund"“Fund”), a series of Rydex Variable Trust (the "Trust"“Trust”) to be held April 7, 201011, 2011 at 3:1:00 p.m., Eastern Time, or any adjournment(s) or postponement(s) thereof (the "Special
Meeting"“Special Meeting”), at the offices of Rydex Investments, 9601 Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, Maryland 20850. The Board has approved a Plan of Liquidation and Dissolution with respect to the Fund whereby the Fund will cease its investment operations, liquidate its assets and make a final distribution to its shareholders of record in one or more cash payments which will immediately be reinvested in Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market), as applicable. Under the Plan of Liquidation, the Fund will promptly wind up its business and affairs. Subject to approval by the Fund'sFund’s shareholders, the date of liquidation for the Fund is anticipated to be on or about April 23, 2010.25, 2011. The Board has called the Special Meeting so that shareholders can vote on the proposed Plan of Liquidation and Dissolution of Series (the "Proposal"“Proposal”).
After careful consideration, the Board has unanimously approved this proposal with respect to the Fund and recommends that shareholders vote "FOR"“FOR” the proposal. Accordingly, you are asked to authorize the liquidation.
If the Proposal is approved by shareholders of the Fund and you have not elected to move your contract/accountcontract value to a new investment option prior to the liquidation of the Fund, upon the liquidation of the fund, your contract/accountcontract value will be reinvested in Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) if you have a variable annuity issued by First Security Benefit Life Insurance and Annuity Company of New York; Northern Lights Variable Trust JNF Money Market Portfolio if you have a variable annuity issued by Jefferson National Life Insurance Company; NVIT Money Market Fund (Class I)II) if you have a variable annuity or a life insurance policy issued by Nationwide Life Insurance Company; or Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) if you have a variable annuity issued by Security Benefit Life Insurance Company.
A Proxy Statement that describes the Proposal is enclosed. We urge you to vote your shares by completing and returning the enclosed proxy in the envelope provided, or vote by Internet or telephone, at your earliest convenience.
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU OWN. IN ORDER TO
AVOID THE ADDED COST OF FOLLOW-UP SOLICITATIONS AND POSSIBLE ADJOURNMENTS,
PLEASE TAKE A FEW MINUTES TO READ THE PROXY STATEMENT AND CAST YOUR VOTE. IT IS
IMPORTANT THAT YOUR VOTE BE RECEIVED NO LATER THAN
Your vote is important regardless of the number of shares you own. In order to avoid the added cost of follow-up solicitations and possible adjournments, please take a few minutes to read the Proxy Statement and cast your vote. It is important that your vote be received no later than 11:59 P.M. ON APRIL 6, 2010.
p.m. on April 10, 2011.
We appreciate your participation and prompt response in this matter and thank you for your continued support.
Sincerely,
/s/
/s/ Richard M. Goldman
Richard M. Goldman
President
MULTI-CAP CORE EQUITY FUND
International Long Short Select Fund
A SERIES OF
RYDEX VARIABLE TRUST
9601 BLACKWELL ROAD, SUITE 500
ROCKVILLE,Series of
Rydex Variable Trust
805 King Farm Boulevard, Suite 600
Rockville, MD 20850
(800) 820-0888
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 7, 2010
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To be held April 11, 2011
To the Shareholders:
Shareholders:
Notice is hereby given that Rydex Variable Trust (the "Trust"“Trust”) will hold a special meeting of shareholders of Multi-Cap Core EquityInternational Long Short Select Fund (the "Fund"“Fund”) on April 7, 2010,11, 2011, at 3:1:00 p.m., Eastern Time as adjourned from time to time (the "Special Meeting"“Special Meeting”) for the purposes listed below:
1. To approve a Plan of Liquidation and Dissolution, providing for the
liquidation and dissolution of the Fund; and
2. To transact such other business as may properly come before the
Special Meeting.
| 1. | To approve a Plan of Liquidation and Dissolution, providing for the liquidation and dissolution of the Fund; and |
| 2. | To transact such other business as may properly come before the Special Meeting. |
After careful consideration, the Board of Trustees of the Trust (the "Board"“Board”) unanimously approved the Plan of Liquidation and Dissolution and recommends that shareholders vote "FOR"“FOR” the Proposal.
Shareholders of record at the close of business on February 16, 201025, 2011 are entitled to notice of, and to vote at, the Special Meeting. Your attention is called to the accompanying Proxy Statement. You are requested to complete, date, and sign the enclosed proxy card and return it promptly in the envelope provided for that purpose. Your proxy card also provides instructions for voting via telephone or the Internet if you wish to take advantage of these voting options. Proxies may be revoked at any time by executing and submitting a revised proxy, by giving written notice of revocation to the Trust, or by voting in person at the Special Meeting.
By Order of the Board
/s/ ,
/s/ Joanna M. Haigney
Joanna M. Haigney
INTRODUCTION
WHY IS THE SPECIAL MEETING BEING HELD?
Why is the Special Meeting Being Held?
The Board of Trustees (the "Board"“Board”) of Rydex Variable Trust (the "Trust"“Trust”) on behalf of Multi-Cap Core EquityInternational Long Short Select Fund (the "Fund"“Fund”) is sending this proxy statement ("(“Proxy Statement"Statement”), the attached Notice of Special Meeting and the enclosed Voting Instructions Card on or about March 1, 2010.21, 2011. At the special meeting (the "Special Meeting"“Special Meeting”), shareholders of the Fund will be asked to approve the Plan of Liquidation and Dissolution of the Fund, providing for the liquidation and dissolution of the Fund (the "Proposal"“Proposal”). Finally, the Special Meeting is being held to transact such other business, not currently contemplated, that may properly come before the Special Meeting or any adjournment(s) thereof in the discretion of the proxies or their substitutes.
WHY DID YOU SEND ME THIS BOOKLET?
Why did you send me this booklet?
Shares of the Fund are not offered directly to the public but are sold only to insurance companies and their separate accounts as the underlying investment medium for owners of variable annuity contracts and variable life insurance policies. As such, First Security Benefit Life Insurance and Annuity Company of New York, Jefferson National Life Insurance Company, Nationwide Life Insurance Company and Security Benefit Life Insurance Company (collectively, the "Insurance Companies"“Insurance Companies”) are the only shareholders of record of the Fund. Rydex Variable Trust is soliciting voting instructions from variable annuity contract holders and life insurance policy owners invested in the Fund in connection with the proposal. As such and for ease of reference, throughout the proxy statement, variable annuity contract holders and life insurance policy owners may be referred to as "shareholders"“shareholders” of the Fund.
You have received this Proxy Statement because you have a variable annuity contract or life insurance policy issued by of one of the Insurance Companies and you are invested in the Fund. As such, you have the right to give voting instructions on shares of the Fund that are attributable to your variable annuity contract, or life insurance policy, if your voting instructions are properly submitted and received prior to the Special Meeting.
This booklet also includes certain information about Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund and SBL Fund Series C (Money Market), as provided in APPENDIX A.Appendix A. If the Proposal is approved by shareholders of the Fund and you have not elected to move your contract/accountcontract value to a new investment option prior to the liquidation of the Fund, upon the liquidation of the Fund, your contract/accountcontract value will be reinvested in either Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) if you have a variable annuity issued by First Security Benefit Life Insurance and Annuity Company of New York; Northern Lights Variable Trust JNF Money Market Portfolio if you have a variable annuity issued by Jefferson National Life Insurance Company; NVIT Money Market Fund (Class I)II) if you have a variable annuity or life insurance policy issued by Nationwide Life Insurance Company; or Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) if you have a variable annuity issued by Security Benefit Life Insurance Company. Please see "How“How are the proposed liquidation plan and related transactions to be effected if the Fund'sFund’s shareholders approve the Proposal?"” below for more information.
WHO IS ASKING FOR MY VOTE?
Who is asking for my vote?
The enclosed proxyBoard is being solicited by the Boardsoliciting your vote for use at a special meeting of the Fund'sFund’s shareholders.
WHO IS ELIGIBLE TO VOTE?
Who is eligible to vote?
Shareholders holding an investment in shares of the Fund as of the close of business on February 16, 201025, 2011 (the "Record Date"“Record Date”) are eligible to vote or instruct their insurance company or plan trusteeInsurance Company as to how to vote their shares.
As of the Record Date, no person owned beneficially more than 5% of any class of the Fund, except as set forth in APPENDIX B.Appendix B. To the best of the Trust'sTrust’s knowledge, as of the Record Date, the officers and Trustees beneficially owned, as a group, less than 1% of any class of the Portfolio.
HOW DO How do I VOTE?
vote?
Shares of the Fund are sold to Insurance Companies and their Separate
Accountsseparate accounts and are used as investment options under variable annuity contracts and life insurance policies ("(“Variable Contracts"Contracts”). Variable Contract holders who select the Fund for investment through a Variable Contract have a beneficial interest in the Fund, but do not invest directly in or hold shares of the Fund. An Insurance Company that uses the Fund as a funding vehicle, is, in most cases, the legal shareholder of the Fund and, as such, has sole voting power with respect to the shares, but generally will pass through any voting rights to Variable Contract holders. Therefore, for Separate Accountsseparate accounts that are registered with the SEC, an Insurance Company will request voting instructions from the Variable Contract holder and will vote shares or other interests in the Separate
Accountseparate account as directed by the Variable Contract holder. In the event that any Variable Contract holders fail to provide voting instructions with respect to Separate Accountsseparate accounts registered with the SEC, the Insurance Company will vote the shares attributable to those Variable Contract holders for, against, or abstain, in the same proportion as the shares for which voting instructions were received from Variable Contract holders investing through the same Separate Account,separate account, even if only a small number of Variable Contract holders provide voting instructions. The effect of proportional voting is that if a large number of Variable Contract holders fail to give voting instructions, a small number of Variable Contract holders may determine the outcome of the vote.
Variable Contract holders permitted to give instructions to an Insurance Company and the number of shares for which such instructions may be given for purposes of voting at the Special Meeting, and any adjournment or postponement thereof, will be determined as of the Record Date. In connection with the solicitation of such instructions from Variable Contract holders, it is expected that the respective Insurance Companies will furnish a copy of this Proxy Statement to Variable Contract holders.
Shares of the Fund are also sold directly to the trustees and
custodians of certain Qualified Plans. The trustee or custodian for the
Qualified Plan that includes the Fund as an investment option, is, in most
cases, the legal shareholder of the Fund and, as such, has sole voting power
with respect to the shares, but in some cases will pass through any voting
rights to Plan Participants who have an interest in the Fund. With respect to
Fund shares held by trustees or custodians of Qualified Plans, in the event any
Plan Participants fail to give instructions as how to vote their shares, the
trustee or custodian will use proportional voting and vote those shares in
proportion to the instructions given by other Plan Participants who voted. The
effect of proportional voting is that if a large number of Plan Participants
fail to give voting instructions, a small number of Plan Participants may
determine the outcome of the vote.
Qualified Plans, and in some cases their participants, are permitted to
give instructions to the Fund and the number of shares for which instructions
may be given for purposes of voting at the Special Meeting, and any adjournment
or postponement thereof, will be determined as of the Record Date. In connection
with the solicitation of such instructions from Qualified Plans or their
participants, it is expected that the respective trustees/custodians will
furnish a copy of this Proxy Statement to the Qualified Plan and its
participants, as applicable.
If a shareholder wishes to participate in the Special Meeting, he or she may submit the Voting Instructions Card originally sent with the Proxy Statement or attend the Special Meeting in person. All persons entitled to direct the voting of shares, whether they are Variable Contract Holders,
insurance companies, trustees/custodians, Qualified Plansholders or participantsInsurance Companies are described as shareholders for purposes of this Proxy Statement. Shareholders can vote in one of four ways:
o
| · | By mail with the enclosed proxy card – be sure to sign, date and return it in the enclosed postage-paid envelope, |
| · | Through the web site listed in the proxy voting instructions, |
| · | By telephone using the toll-free number listed in the proxy voting instructions, or |
| · | In person at the shareholder meeting on April 11, 2011. |
When and where will the
enclosed proxy card -Special Meeting be
sure to sign, date and
return it in the enclosed postage-paid envelope,
o Through the web site listed in the proxy voting instructions,
o By telephone using the toll-free number listed in the proxy voting
instructions, or
o In person at the shareholder meeting on April 7, 2010.
WHEN AND WHERE WILL THE SPECIAL MEETING BE HELD?
held? The Special Meeting is scheduled to be held at the offices of Rydex Investments, 9601 Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, Maryland 20850 on April 7, 201011, 2011 at 3:1:00 p.m., Eastern Time,, and, if the Special Meeting is adjourned or postponed, at any adjournment(s) or postponement(s) of the Special Meeting. HOW CAN
How can I OBTAIN MORE INFORMATION ABOUT THE FUND?
obtain more information about the Fund?
Additional information about the Fund is available in its prospectus, statement of additional information, semi-annual report, and annual report to shareholders. Copies of the Fund'sFund’s annual and semi-annual reports have previously been mailed to shareholders. This Proxy Statement should be read in conjunction with the annual and semi-annual reports. YOU CAN OBTAIN COPIES OF
THOSE REPORTS, WITHOUT CHARGE, BY WRITING TO RYDEX VARIABLE TRUST, AT 9601
BLACKWELL ROAD, SUITE 500, ROCKVILLE, MARYLANDYou can obtain copies of those reports, without charge, by writing to Rydex Variable Trust, at 805 King Farm Boulevard, Suite 600, Rockville, Maryland 20850, OR BY CALLINGor by calling 888.820.0888.
HOW DOES THE BOARD RECOMMEND THAT
How does the Board recommend that I VOTE?
vote?
The Board recommends that shareholders vote "FOR"“FOR” the Proposal. THE PROPOSAL
APPROVAL OF THE PLAN OF LIQUIDATION AND DISSOLUTION OF
MULTI-CAP CORE EQUITY
INTERNATIONAL LONG SHORT SELECT FUND
WHAT IS THE PROPOSAL?
What is the Proposal?
At a regular meeting of the Board'sBoard held February 12, 2010 meeting,23, 2011, the Board, including those trustees who are not "interested persons"“interested persons” of the Trust as defined in the Investment Company Act of 1940, as amended (the "1940 Act"“1940 Act”) (the "Independent
Trustees"“Independent Trustees”), unanimously approved the proposed liquidationPlan of Liquidation and dissolution plan of Multi-Cap
Core EquityDissolution for the International Long Short Select Fund (the “liquidation plan”) and directed that the liquidation plan providing for the
liquidation and dissolution of the Fund, be submitted to the FundFund’s shareholders for approval. A copy of the form of the liquidation plan, which provides for the complete liquidation of all assets of the Fund, is attached to this Proxy Statement as APPENDIX C.
WHAT ARE THE REASONS FOR THE PROPOSED LIQUIDATION AND DISSOLUTION OF THE FUND?
Appendix C.
What are the reasons for the proposed liquidation and dissolution of the Fund?
The Fund commenced operations on November 29, 2005March 27, 2008 and is an insurance-dedicated fund that is offered through variable annuity contracts and
insurance policiesVariable Contracts issued by insurance companies.
Since inception, the Fund has been less popular with the public than originally anticipated. Sales have been weak, and the issuersinsurance companies do not anticipate any future prospects for gathering substantial assets for the Fund. To illustrate, as of December 31, 2009,2010, the Fund'sFund’s assets under management were only $2,384,788.
$4,715,768.00.
Considering that the asset size of the Fund is small, Management does not anticipate that the Fund will be able to attract sufficient additional assets in the foreseeable future to maintain viability nor does Management anticipate offering the Fund through new insurance or retirement products. Furthermore, Management determined that maintaining the Fund at its current asset levels would not be beneficial in the long-term to shareholders. For example, the small asset base of the Fund makes it difficult for the Fund to take large positions in potentially attractive investment opportunities. Consequently, Management determined that action should be taken to address the small asset size of the Fund.
In evaluating alternatives for the Fund, Management considered reorganization and liquidation options for the Fund. Management analyzed a possible merger of the Fund with other funds in the Rydex Funds complex, and concluded that due to the costs associated with a fund reorganization, which would be borne by both Management and shareholders of the Fund, a fund merger was not an appropriate option. Accordingly, Management recommended and the Board agreed that liquidation and dissolution of the Fund represents the most favorable course of action.
HOW ARE THE PROPOSED LIQUIDATION PLAN AND RELATED TRANSACTIONS TO BE EFFECTED IF
THE FUND'S SHAREHOLDERS APPROVE THE PROPOSAL?
How are the proposed liquidation plan and related transactions to be effected if the Fund’s shareholders approve the Proposal?
If the liquidation plan is approved by the Fund'sFund’s shareholders, the liquidation plan will be effective on or about April 7th, 2010 ("11, 2011 (“Effective Date"Date”). On or about April 22, 2010,As soon as practicable, but notin no event later than April 23, 201025, 2011 (the "Liquidation Date"“Liquidation Date”), the Fund will be liquidated in accordance with the terms of its liquidation plan. All portfolio securities of the Fund not already converted to cash or cash equivalents will be converted to cash or cash equivalents.
Between the Effective Date and the Liquidation Date (the "Liquidation
Period"“Liquidation Period”), the Fund will pay, discharge, or otherwise provide for the payment or discharge of, any and all its liabilities and obligations of the Fund. If the Fund is unable to pay, discharge or otherwise provide for any of its liabilities during its Liquidation Period, the Fund may: (i) retain cash or cash equivalents in an amount that it estimates is necessary to discharge any unpaid liabilities and obligations of the Fund on the Fund'sFund’s books as of the Liquidation Date; and (ii) pay such contingent liabilities as the Board shall reasonably deem to exist against the assets of the Fund on the Fund'sFund’s books.
On the Liquidation Date, the Fund'sFund’s assets will be distributed ratably among its shareholders of record in one or more cash payments which will immediately be reinvested in Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund and SBL
Fund Series C (Money Market) as applicable. The proportionate interests of shareholders in the assets of the Fund shall
be fixed on the basis of their respective shareholdings at the close of business on April 23, 2010the Liquidation Date and subsequently, the Fund'sFund’s books will be closed and subject to applicable law, the shareholders'shareholders’ respective interests in the Fund will not be transferable or redeemable. The first distribution of the Fund'sFund’s assets is expected to consist of cash representing substantially all the assets of the Fund, less the amount reserved to pay creditors of the Fund, if any.As discussed above, the Fund is only available as an investment option for variable annuity contracts and life insurance policiesVariable Contracts issued by insurance companies.companies and to the trustees and custodians of certain Qualified Plans. Prior to the proposed liquidation, Variable Contract holders and Plan
Participants will be provided an opportunity to transfer their assets to the other portfolios available under their Variable Contracts or their Qualified
Plans, respectively.Contracts. In the event that shareholders approve the liquidation plan of the Fund and you have not elected to move your contract/accountcontract value to a new investment option prior to the Fund'sFund’s Liquidation Date, upon the liquidation of the Fund, your contract/accountcontract value will be reinvested in a default investment option as follows:
o
| · | If you are a participant in a registered group annuity contract or you hold an individual variable annuity contract issued by First Security Benefit Life Insurance and Annuity Company of New York, your contract value will be reinvested in Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market), depending upon the investment options available to you under your Variable Contract; |
| · | If you are a participant in a registered group annuity contract or you hold an individual variable annuity contract issued by Jefferson National Life Insurance Company, your contract value will be reinvested in Northern Lights Variable Trust JNF Money Market Portfolio; |
| · | If you are a participant in a registered group annuity contract or you hold an individual annuity contract issued by Nationwide Life Insurance Company, your contract value will be reinvested in NVIT Money Market Fund (Class II); |
| · | If you are a participant in a registered group annuity contract or you hold an individual annuity contract issued by Security Benefit Life Insurance Company, your contract value will be reinvested in Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market), depending upon the investment options available to you under your Variable Contract. |
A summary of each default investment option’s investment objective, investment strategy, risks, and expenses is included in Appendix A. Shareholders should read this information and each default investment option’s prospectus carefully before deciding to take advantage of the default investment options available to you under your Variable Contract;
o If you are a participant in a registered group annuity contract or you
hold an individual variable annuity contract issued by Jefferson
National Life Insurance Company, your contract value will be
reinvested in Northern Lights Variable Trust JNF Money Market
Portfolio;
o If you are a participant in a registered group annuity contract or you
hold an individual annuity contract or life insurance policy issued by
Nationwide Life Insurance Company, your contract value will be
reinvested in NVIT Money Market Fund (Class I);
o If you are a participant in a registered group annuity contract or you
hold an individual annuity contract issued by Security Benefit Life
Insurance Company, your contract value will be reinvested in Rydex
Variable Trust U.S. Government Money Market Fund or SBL Fund Series C
(Money Market), depending uponas some of the investment options available to you
under your Variable Contract.
funds may have higher fees and expenses and different risks than others.
After the liquidation of the Fund, you will be provided a notice about this reinvestment and will be informed that you may request transfers of your contract/accountcontract value out of any of these funds pursuant to the terms under your Variable Contract or Qualified Plan.
.
Variable Contract holders and Plan Participants may have other portfolio options through their variable annuity and life insurance platforms
and Qualified Plans, respectively.platforms. If you are a Variable Contract holder whose Variable Contract includes the Fund as an investment option, please consult the current prospectus for your Variable Contract or call 1-800-888-2461 if you are a First Security Benefit Life Insurance and Annuity Company of New York Contract holder, 1-866-667-0561 if you are Jefferson National Variable Contract holder, 1-800-848-6331 if you are a Nationwide Life Insurance Company variable annuity contract holder, 1-800-243-6295 if you are a Nationwide Life Insurance Company
life insurance policy owner, or 1-800-888-2461 if you are a Security Benefit Life Insurance Company Variable Contract holder for more information on other investment options available to you and instructions on how to transfer your contract value. If you are a Plan Participant whose Qualified Plan includes the
Fund as an investment option, please consult your plan documents or contact your
plan administrator for more information on other investment options available to
you and instructions on how to transfer your account value.
With respect to Variable Contract holders, after consulting with the insurance companyInsurance Company that issued the pertinent Variable Contracts, Management has advised that the liquidation of the Fund will not have an impact onalter a Variable Contract holder'sholder’s rights or the obligations of the Insurance Company to that Variable Contract holder, in particular, the liquidation will not affect a Variable Contract holder’s right to transfer contract values among and between other investment options offered
under their Variable Contracts. A Variable Contract holder would be able to transfer contract values out of any sub-account invested in the Fund free of any charges at any time. In connection with the liquidation of the Fund, any such transfer out of the Fund or any of the default investment options described above within a period beginning 60 days before, and ending 60
days after, the Liquidation Date will not be counted for the purposes of applying any excessive trading policies. After consulting with the insurance
company that issued the pertinent Variable Contracts, Management has advised
that the liquidation of the Portfolio will not alter a Variable Contract
holder's rights or the obligations of the insurance company to that Variable
Contract holder. In addition, if the liquidation plan is adopted, Variable Contract holders will continue to have the same rights they previously had to withdraw contract values allocated to the Fund under their Variable Contracts. Withdrawal of contract value may involve other charges (e.g., surrender charges) and other adverse consequences under the terms of the Variable Contracts, and Variable Contract holders should consult the prospectus for their Variable Contract.
INFORMATION ABOUT NORTHERN LIGHTS VARIABLE TRUST
Information About Northern Lights Variable Trust JNF MONEY MARKET PORTFOLIO,Money Market Portfolio, NVIT MONEY MARKET FUND (CLASS I)Money Market Fund (Class II), RYDEX VARIABLE TRUSTRydex Variable Trust U.S. GOVERNMENT MONEY
MARKET FUND ANDGovernment Money Market Fund and SBL FUND SERIESFund Series C (MONEY MARKET)
APPENDIX(Money Market)
Appendix A contains certain information about Northern Lights Variable Trust JNF Money Market Portfolio , NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund and SBL Fund Series C (Money Market), including a table comparing current operating expenses between the Fund and these funds. This information is summary in nature, and you should consult the prospectuses for Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) for more complete information about these funds. In connection with the liquidation of the Fund, you will receive a prospectus of Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) if your contract/accountcontract value is reinvested in any of these funds, as applicable. There is no assurance that Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund or SBL Fund Series C (Money Market) will perform as expected or achieve its investment objective.
More detaildetailed information about Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund and SBL Fund Series C (Money Market) is available in each corresponding fund'sfund’s prospectus, statement of additional information, semi-annual report, and annual report to shareholders. The copies of each fund'sfund’s prospectus, statement of additional information, and semi-annual and annual reports can be obtained, without charge, by writing to your insurance carrier at the following addresses:
First Security Benefit Life Insurance and
Annuity Company of New York
PO Box 750497
Topeka, KS 66675-0491
Jefferson National Life Insurance
9920 Corporate Campus Dr.,
Suite 1000
Louisville, KY 40223
Nationwide World Headquarters
One Nationwide Plaza RR1-04-F4
Columbus, OH 43215-2220
43215–2220
Rydex Variable Trust
805 King Farm Boulevard, Suite 600
Rockville, MD 20850
Security Benefit Life Insurance Company
One Security Benefit Place
Topeka, KS 66636
ARE THERE ANY FEDERAL INCOME TAX CONSEQUENCES?
Are there any Federal income tax consequences?
Liquidation of the Fund will not result in tax implications for the Fund or the Variable Contract holders because the Fund is held in variable annuity
and life insurance products. However, withdrawals of contract value from a Variable Contract may have adverse tax consequences, and you should consult your tax adviser before making such withdrawals.
WHO PAYS THE COSTS OF THE FUND'S LIQUIDATIONS?
PADCO Advisors II, Inc.,Who pays the costs of the Fund’s liquidations?
Security Investors, LLC, located at 9601 Blackwell Road, Suite 500,
Rockville, Maryland 20850 ("PADCO"One Security Benefit Place, Topeka, KS 66636-0001 (“SI” or the "Advisor"“Advisor”), the Fund'sFund’s investment adviser, or an affiliate, will bear the costs of the Fund'sFund’s liquidation including the expense of soliciting the Fund'sFund’s shareholders for approval of the Fund'sFund’s liquidation plan. However, the Fund will bear the transaction costs (i.e., commissions) associated with the liquidation of the Fund'sFund’s securities.
WHAT IS THE REQUIRED VOTE?
What is the required vote?
Approval of the Proposal by the Fund'sFund’s shareholders requires an affirmative vote of a majority of the votes cast that are entitled to vote on this proposal.
WHAT HAPPENS IF THE FUND'S SHAREHOLDERS DO NOT APPROVE THE PROPOSAL?
What happens if the Fund’s shareholders do not approve the Proposal?
If the Fund'sFund’s shareholders do not approve the Proposal, the Portfolio will continue to be managed in accordance with its current investment objective and policies, and the Board will determine what action, if any, should be taken.
WHAT IS THE RECOMMENDATION OF THE BOARD?
What is the recommendation of the Board?
Based upon its review, the Board has determined that the Proposal is in the best interests of the Fund and its shareholders. In making this determination, the Board took into account materials presented to the Board in advance of its February 12, 2010 meeting,decision, including a memorandum from Management discussing Management'sManagement’s rationale for proposing the liquidation plan of the Fund. In particular, the Board considered the fact that Management did not anticipate any future prospects for increasing the Fund’s assets under management and did not believe that continuing to manage the Fund at its current asset levels would be beneficial to the Fund or its shareholders. The Board also considered Management’s recommendation to not reorganize the Fund into another existing Rydex Fund because of the lack of a suitable Rydex Fund with a complementary investment objective and strategy and the potential cost of a reorganization in comparison to the relatively low level of assets under management that the Fund would contribute to the existing Rydex Fund in such a reorganization. The Board further considered the regulatory constraints involved in the reorganization of a variable fund, including the time needed to seek and obtain exemptive relief to carry out a reorganization of the Fund were a complementary Rydex Fund to be identified. After consideration of these materials and factors and information it considered relevant, the Board, including all of the Independent Trustees,
present at the Board's February 12, 2010 meeting, approved the Proposal and voted to recommend its approval to shareholders of the Fund . The Board is recommending that shareholders vote "FOR"“FOR” the Proposal to approve the liquidation plan of the Fund.
ADDITIONAL INFORMATION
CERTAIN OF THE FUND'S SERVICE PROVIDERS
Certain of The Fund’s Service Providers
Principal Underwriter.Rydex Distributors, Inc.LLC (the "Distributor"“Distributor”), located at 9601 Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, Maryland 20850, serves as the distributor and principal underwriter for shares of the Trust and the Fund under the general supervision and control of the Board and the officers of the Trust andpursuant to a distribution agreement adopted by the Trust (the "Distribution
Agreement"“Distribution Agreement”). The Distributor is a subsidiary of Security Benefit Corporation ("(“Security Benefit"Benefit”) and an affiliate of the Advisor.
The Administrator.Administrator. Rydex Fund Services, Inc.LLC (the "Administrator"“Administrator”), 9601
Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, Maryland 20850, serves as the administrator, transfer agent, and accounting services agent for the Trust, and the Fund, subject to the general supervision and control of the Board and the officers of the Trust, pursuant to a administration agreement between the Trust and the Administrator (the "Administration Agreement"“Administration Agreement”). The Administrator is a subsidiary of Security Benefit and an affiliate of the Advisor.
VOTING INFORMATION
Voting Information
Proxy Solicitation.The principal solicitation of proxies will be by the mailing of this proxy statement on or about March 1, 2010,21, 2011, but proxies may also be solicited by telephone and/or in person by representatives of the Trust, regular employees of PADCO,SI, the investment advisor,Advisor, their affiliate(s), or The Altman Group, a private proxy services firm. If we have not received your vote as the date of the Special Meeting approaches, you may receive a call from these parties to ask for your vote. Arrangements will be made with brokerage houses and other custodians, nominees, and fiduciaries to forward proxies and proxy materials to their principals.
The costs of the Special Meeting, including the costs of retaining The Altman Group, preparation and mailing of the notice, proxy statement and proxy, and the solicitation of proxies, including reimbursement to broker-dealers and others
who forwarded proxy materials to their clients, will be borne by the investment
advisorAdvisor and/or its affiliates. The estimated cost of retaining The Altman Group is approximately $15,000.
$9,040.00.Shareholder Voting. Shareholders of the Fund who own shares at the close of business on February 16, 201025, 2011 (the "Record Date"“Record Date”) will be entitled to notice of, and to vote at, the Special Meeting. Shareholders are entitled to one vote for each share held and fractional votes for fractional shares held. The number of shares of the Fund as to which voting instructions may be given to the Trust is determined by dividing the amount of the shareholder's variable annuity or life insurance policy value attributable to the Fund on the Record Date by the net asset value per share of the Fund as of the same date. As of the Record Date, there were issued and outstanding [XXX][xxx] shares of the Fund, representing the same number of votes. The Insurance Companies who are known to have owned beneficially 5% or more of the Fund'sFund’s outstanding shares as of the Record Date are listed on Exhibit C.in Appendix B. As of the Record Date, the DirectorsTrustees and officers, as a group, owned less than 1.00% of the outstanding shares of the Fund. As of the Record Date, there were no persons who were known to control the Fund.
An Insurance Company that uses shares of the Fund as funding media for its Variable Contracts will vote shares of the Fund held by its Separate Accounts in accordance with the instructions received from shareholders. An Insurance Company also will vote shares of the Fund held in such Separate Account for which it has not received timely instructions in the same proportion as it votes shares so held for which it has received instructions even in instances where a broker would be prevented from exercising discretion. "Broker“Broker non-votes,"” therefore, will be voted by each Insurance Company just as any other shares for which the Insurance Company does not receive voting instructions.. Asinstructions. As a result, a small number of shareholders could determine the outcome of the vote if other shareholders fail to vote. An Insurance Company whose Separate Account invests in the Fund will vote shares held by its general account and its subsidiaries in the same proportion as other votes cast by its Separate Account in the aggregate.
More than 50% of the Fund'sFund’s shares, represented in person or by proxy, will constitute a quorum for the Special Meeting and must be present for the transaction of business at the Special Meeting. Only proxies that are voted by an Insurance Company or abstentions will be counted toward establishing a quorum. In the event that a quorum is not present at the Special Meeting, or a quorum is present but sufficient votes to approve Proposal 1 are not received, the persons named as proxies may propose one or more adjournments of the Special Meeting to permit further solicitation of proxies. Any such adjournment will require the affirmative vote of a majority of the Fund shares represented at the Special Meeting in person or by proxy (excluding abstentions). The persons named as proxies will vote those proxies that they are entitled to vote FOR Proposal 1 in favor of an adjournment of the Special Meeting, and will vote those proxies required to be voted AGAINST Proposal 1 against such adjournment. A shareholder vote may be taken on any proposal prior to any such adjournment if sufficient votes have been received and it is otherwise appropriate. As a practical matter, because the Insurance Companies own more than 50% of the Fund'sFund’s shares and each Insurance Company is expected to be present at the Special Meeting, in person or by proxy, it is likely that there will be a quorum at the Special Meeting.
The person(s) named as proxies on the enclosed proxy card will vote in accordance with your directions, if your proxy is received properly executed. If we receive your proxy, and it is executed properly, but you give no voting instructions with respect to any proposal, your shares will be voted FOR Proposal 1. The duly appointed proxies may, in their discretion, vote upon such other matters as may properly come before the Special Meeting.
In order that your shares may be represented at the Special Meeting, you are requested to vote your shares by mail, the Internet or by telephoneby following the enclosed instructions. IF YOU VOTE BY TELEPHONE OR INTERNET, PLEASE DO NOT
RETURN YOUR PROXY CARD, UNLESS YOU LATER ELECT TO CHANGE YOUR VOTE. If you vote by telephone or Internet, please do not return your proxy card, unless you later elect to change your vote.You may revoke your proxy: (a) at any time prior to its exercise by written notice of its revocation to the secretary of the Fund prior to the Special Meeting; (b) by the subsequent execution and return of another proxy prior to the Special Meeting; or (c) by being present and voting in person at the Special Meeting and giving oral notice of revocation to the chairman of the Special Meeting.
Meeting. However, attendance in-person at the Special Meeting, by itself, will not revoke a previously-tendered proxy.
Required Vote. Approval of Proposal 1 requires the vote of a "majority“majority of the outstanding voting securities"securities” of the Fund, which means the vote of 67% or more of the shares that are present at the Special Meeting, if the holders of more than 50% of the outstanding shares are present or represented by proxy, or the vote of more than 50% of the Fund's
Fund’s outstanding shares, whichever is less. Accordingly, assuming the presence of a quorum, abstentions and broker non-votes have the effect of a negative vote on Proposal 1. Shareholders Sharing the Same Address. As permitted by law, only one copy of this proxy statement may be delivered to shareholders residing at the same address, unless such shareholders have notified the Fund of their desire to receive multiple copies of the shareholder reports and proxy statements that the Fund sends. If you would like to receive an additional copy, please contact the Fund by writing to the Fund'sFund’s address, or by calling the telephone number shown on the front page of this proxy statement. The Fund will then promptly deliver, upon request, a separate copy of the proxy statement to any shareholder residing at an address to which only one copy was mailed. Shareholders wishing to receive separate copies of the Fund'sFund’s shareholder reports and proxy statements in the future, and shareholders sharing an address that wish to receive a single copy if they are receiving multiple copies, should also send a request as indicated.
SHAREHOLDER PROPOSALS
Shareholder Proposals
As a general matter, the Trust does not hold annual meetings of shareholders. Shareholders wishing to submit proposals for inclusion in a proxy statement for a subsequent shareholders'shareholders’ meeting should send their written proposal to the Secretary of the Trust, 9601 Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, MD 20850.
Proposals must be received a reasonable time prior to the date of a meeting of shareholders to be considered for inclusion in the proxy materials for the meeting. Timely submission of a proposal does not, however, necessarily mean that the proposal will be included. Persons named as proxies for any subsequent shareholders'shareholders’ meeting will vote in their discretion with respect to proposals submitted on an untimely basis.
TO ENSURE THE PRESENCE OF
To ensure the presence of a quorum at the Special Meeting, prompt execution and return of the enclosed proxy is requested. A QUORUM AT THE SPECIAL MEETING, PROMPT EXECUTION AND
RETURN OF THE ENCLOSED PROXY IS REQUESTED. A SELF-ADDRESSED, POSTAGE-PAID
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
self-addressed, postage-paid envelope is enclosed for your convenience.
By Order of the Board of Trustees,
/s/
/s/ Richard M. Goldman
Richard M. Goldman
LIST OF APPENDICES
Appendix A: Summary Information of Northern Lights Variable Trust JNF
Money Market Portfolio, NVIT Money Market Fund (Class I),
Rydex Variable Trust U.S. Government Money Market Fund and
SBL Fund Series C (Money Market)
Appendix B: Beneficial and Record Owners
Appendix C: Form of Plan of Liquidation and Dissolution of Series
| Appendix A: | Summary Information of Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class II), Rydex Variable Trust U.S. Government Money Market Fund and SBL Fund Series C (Money Market) |
| Appendix B: | Beneficial and Record Owners |
| Appendix C: | Plan of Liquidation and Dissolution of Series |
APPENDIX A
SUMMARY INFORMATION OF
NORTHERN LIGHTS VARIABLE TRUST JNF MONEY MARKET PORTFOLIO
NVIT MONEY MARKET FUND (CLASS I)
II)
RYDEX VARIABLE TRUST U.S. GOVERNMENT MONEY MARKET FUND
SBL FUND SERIES C (MONEY MARKET)
The following information is extracted from the May 1, 20092010 prospectus of Multi-Cap Core EquityInternational Long Short Select Fund, a series of Rydex Variable Trust; May 1, 20092010 prospectus of JNF Money Market Portfolio, a series of Northern Lights Variable Trust; the May 1, 20092010 prospectus of NVIT Money Market Fund (Class I)II), a series of Nationwide Variable Insurance Trust; the May 1, 20092010 prospectus of Rydex Variable Trust U.S. Government Money Market Fund, a series of Rydex Variable Trust and the May 1, 20092010 prospectus of Series C (Money Market), a series of SBL Fund. Variable Contract holders or Plan Participants should review the prospectuses of Northern Lights Variable Trust JNF Money Market Portfolio, NVIT Money Market Fund (Class I)II), Rydex Variable Trust U.S. Government Money Market Fund and SBL Fund Series C (Money Market) carefully before making any investment decisions with respect to these funds.
------------------------------------------------------------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
(% OF AVERAGE DAILY NET ASSETS)
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
MULTI-CAP CORE JNF MONEY MARKET NVIT MONEY MARKET RYDEX VARIABLE SBL FUND SERIES C
EQUITY FUND (1) PORTFOLIO (2) FUND (CLASS I) (3) TRUST U.S. (MONEY MARKET)
GOVERNMENT MONEY
MARKET FUND
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Management Fees 0.50% 0.15% 0.38% 0.50% 0.50%
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Distribution and/or Service n/a 0.00% n/a n/a n/a
(12b-1) Fees
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Other Expenses 0.63% 0.55% 0.26% 0.72% 0.15%
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Total Expenses 1.13% 0.70% 0.64% 1.22% 0.65%
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Less: Expense n/a (0.18%) n/a n/a n/a
Waiver/Reimbursement
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Net Expenses 1.13% 0.52% 0.64% 1.22% 0.65%
-------------------------------- ----------------- ------------------ ------------------- --------------------- --------------------
Annual Portfolio Operating Expenses (% of average daily net assets) |
| | International Long Short Select Fund (1) | JNF Money Market Portfolio (2) | NVIT Money Market Fund (Class II) | Rydex Variable Trust U.S. Government Money Market Fund | SBL Fund Series C (Money Market) |
| Management Fees | 0.90% | 0.15% | 0.38% | 0.50% | 0.50% |
| Distribution and/or Service (12b-1) Fees | n/a | 0.00% | 0.25% | n/a | n/a |
| Other Expenses | 3.17% | 0.56% | 0.24% | 0.78% | 0.17% |
| Acquired Fund Fees and Expenses | | | 0.02% | | |
| Total Expenses | 4.07% | 0.71% | 0.89% | 1.28% | 0.67% |
| Less: Expense Waiver/Reimbursement | n/a | (0.02%) | n/a | n/a | n/a |
| Net Expenses | 4.07% | 0.69% | 0.89% | 1.28% | 0.67% |
(1) The Management Fee paid to Multi-Cap Core Equity Fund's advisorEffective June 8, 2010, International Long Short Select Fund’s principal investment strategy changed, and the fees and expenses shown are based on estimated amounts for providing services to the fund consists ofcurrent fiscal year. “Total Other Expenses” reflect estimated short dividend expense, short interest expense and remaining other expenses as a basic annual fee rate of 0.70%result of the fund's average daily net assets, and a performance adjustment, resulting in
a minimum fee of 0.50% and a maximum of 0.90%. Because the performance
adjustment is applied relative to the performance of the Russell 3000(R) Index,
the fund's advisor could receive a positive performance adjustment even during
periods where the fund's performance is negative.
investment strategy change.
(2) The "Other Expenses"“Other Expenses” for JNF Money Market Portfolio include custodian, administration, transfer agency and other customary fund expenses, and are based on amounts incurred during the Portfolio'sPortfolio’s most recently completed fiscal year.
The adviser for JNF Money Market Portfolio has contractually agreed to waive its investment advisory fees and/or reimburse the portfolio to the extent that the
ratio of expenses (excluding brokerage fees and commissions, acquired fund fees
and expenses, costs associated with the participation in the United States
Department of the Treasury's Temporary Guarantee Program forat least until April 30, 2011.
Northern Lights Variable Trust JNF Money Market
Funds,
borrowing costs (such as interest and dividend expense on securities sold
short), taxes and extraordinary expenses) to net assets on an annual basis
exceeds 0.50% for the portfolio. The adviser may discontinue this contractual
limit at any time after April 30, 2010 and may recover any amounts waived or
reimbursed under the contract provisions, to the extent that actual fees and
expenses are less that the expense limitation, for a period of three years after
the date of the waiver or reimbursement.
(3) The "Other Expenses" for NVIT Money Market Fund include administrative
services fees which currently are 0.15%, but which are permitted to be as high
as 0.25%. The full amounts of administrative services fees are not reflected in
"Other Expenses" for Class I shares at this time because, until at least May 1,
2010, the Fund does not intend to pay insurance companies a higher amount. If
the full amounts of administrative services fees were charged, total operating
expenses, after fee waivers and/or reimbursements, would be 0.74%.
"Other Expenses" also includes payment by the NVIT Money Market Fund through
September 18, 2009 of an amount equal to 0.03% of the value of the fund's net
assets as of September 19, 2008 to participate in the United States Department
of the Treasury's Temporary Guarantee Program for Money Market Funds.
NORTHERN LIGHTS VARIABLE TRUST JNF MONEY MARKET PORTFOLIO
---------------------------------------------------------
INVESTMENT OBJECTIVE
Portfolio
Investment Objective
The Money Market Portfolio seeks to provide as high a level of current income as is consistent with preservation of capital and daily liquidity.
STRATEGY
Strategy
The Portfolio seeks to achieve its investment objective by investing at least 95%97% of its total assets in a diversified portfolio of money market securities that are in the highest rating category for short-term obligations. The Portfolio also may invest up to 5%3% of its total assets in money market securities that are in the second-highest rating category for short-term obligations. The Portfolio may only invest in U.S. dollar-denominated securities that mature in 397 days or fewer from the date of purchase. The dollar-weighted average portfolio maturity of the Portfolio may not exceed 9060 days. The Portfolio attempts to maintain a stable net asset value of $1.00 per share, although there is no assurance that it will be successful in doing so.
The sub-adviser considers interest rates, currency exchange rates and the economy, analyzes credit and call risks, and uses other security selection techniques when selecting Portfolio securities. The proportion of the Portfolio'sPortfolio’s assets committed to investment in securities with particular characteristics (such as quality, sector, interest rate or maturity) varies based on the sub-adviser'ssub-adviser’s outlook for the U.S. and foreign economies, the financial markets and other factors. The sub-adviser focuses on securities that offer safety, liquidity, and a competitive yield. The sub-adviser conducts a credit analysis of each potential issuer prior to the purchase of its securities. There is no guarantee that the sub-adviser's security selection
techniques will produce the desired results.
INVESTMENTS
The Portfolio may invest in the following: obligations of the U.S. Government (including its agencies and government-sponsored enterprises); short-term corporate debt securities of domestic and foreign corporations; obligations of domestic and foreign commercial banks, savings banks, and savings and loan associations; and commercial paper. The Portfolio may invest more than 25% of
its total assets in securities or obligations issued by U.S. banks. The
Portfolio'sPortfolio’s investments in the types of securities described in this prospectus vary from time to time, and at any time, the Portfolio may not be invested in all types of securities described in this prospectus. Any percentage limitations with respect to assets of the Portfolio are applied at the time of purchase. The Portfolio'sPortfolio’s investments will comply with applicable rules governing the quality, maturity and diversification of securities held by money market funds.
SELL DISCIPLINE
The Portfoliosub-adviser typically will sellsells a security when it has reachedreaches its appreciation potential, has ceased to meetit no longer meets the modelsub-adviser’s investment criteria, or
otherwiseit has deteriorating fundamentals. Securities also may be sold to make
cash available to take advantage of other,fundamentals, or when more attractive investment opportunities are available.
Principal Investment Risks: As with all mutual funds, there is the risk that meet the Portfolio's selection criteria, or for defensive
purposes.
PRIMARY RISKS
Anyou could lose money through your investment in the Portfolio is not insured or guaranteed byPortfolio. Many factors affect the Federal
Deposit Insurance Corporation or any other government agency. Although the
Portfolio seeks to preserve thePortfolio’s net asset value of your investment at $1.00 per share, it
is possible to lose money by investing in the Portfolio. The primary risks of
investing in the Portfolio are described below. The Portfolio's exposure to risk
depends upon its specific investment profile. The amount and types of risk vary
depending on:
o The Portfolio's ability to achieve its objective
o The markets in which the Portfolio invests
o The investments the Portfolio makes in those markets
o Prevailing economic conditions over the period of an investment
CREDIT RISK: The risk that theperformance.
Credit Risk. An issuer of a security, or the counterparty to a contract, willmay default or otherwise be unable to honor a financial obligation. The Portfolio could lose money if the issuer or guarantor of a fixed income
security, or the counterparty to a derivatives contract, repurchase agreement or
a loan of portfolio securities, is unable or unwilling to make timely principal
and/or interest payments, or to otherwise honor its obligations. Securities are
subject to varying
degrees of credit risk, which are often reflected in credit ratings. Securities rated below-investment grade are especially susceptible to this risk.
FOREIGN SECURITIES RISK:
Foreign securities have additional risks, including
relatively low market liquidity, decreased publicly available information about
theRisk. Foreign issuers inconsistent and potentially less stringent accounting, auditing
and financial reporting requirements and standards of practice comparable to
those applicable domestic issuers, expropriation, nationalization or other
adverse political or economic developments and the difficulty of enforcing
obligations in other countries. Investments in foreign securities may also be subject to dividend withholdingpolitical and economic instability, the imposition or confiscatory taxes, currency blockage and/tightening of exchange controls or transfer restrictions.
INFLATION-INDEXED SECURITIES RISK: other limitations on repatriation of capital. In addition, there may be changes in foreign governmental attitudes towards private investment, possibly leading to nationalization, increased taxation or confiscation of investors’ assets.
Inflation-Indexed Securities Risk. A nominal interest rate can be described as the sum of a real interest rate and an expected inflation rate. Inflation-indexed securities, including Treasury Inflation-Protected Securities, decline in value when real interest rates rise. In certain interest rate
environments, such as when real interest rates are rising faster than nominal
interest rates, inflation-indexed securities may experience greater losses than
other fixed income securities with similar durations.
INTEREST RATES AND BOND MATURITIES RISK:
Interest Rates and Bond Maturities Risk. Interest rate risk refers to the risk
that changing interest rateschanges may adversely affect the market value of an investment. With fixed-incomeFixed-income securities an increase in interest rates
typically causes the value of those securities to fall, while a decline in value when interest rates may produce an increase in the market value of those securities.
Because of this risk, an investment in a portfolio that invests in fixed-income
securities is subject to risk even if all the fixed-income securities in the
portfolio are paid in full at maturity.rate rise. Bonds with longer maturities will be more affected by interest rate changes than intermediate-term bonds. For
example, if interest rates go down, the price of long-term bonds will increase
more rapidly than the price of intermediate-term bonds.
MANAGEMENT RISK:
Management Risk. The sub-adviser'ssub-adviser’s investment techniques may be unsuccessful and cause the Portfolio to incur losses.
MARKET RISK:
Market Risk. The pricesmarket value of the Portfolio’s investments will fluctuate as the stock and bond markets fluctuate. Market risk may affect a single issuer, industry or section of the income generated by securities held byeconomy or may affect the Portfolio may decline in response to certain events, including those directly
involving the issuers whose securities are owned by the Portfolio; general
economic and market conditions; regional or global economic instability; and
currency and interest rate fluctuations.
MUNICIPAL BOND RISK: as a whole.
Municipal Bond Risk. Municipal bonds are subject to the risk that litigation, legislation or other political events, local business or economic conditions, or the bankruptcy of the issuer could have a significant effect on an issuer'sissuer’s ability to make payments of principal and/or interest. To the extent that the
Portfolio invests 25% or more of its assets in obligations issued by
U.S. banks,
the Portfolio will be subject to bank concentration risks, such as adverse
changes in economic and regulatory developments affecting the banking industry
that could affect the ability of the banks to meet their obligations.
U.S. GOVERNMENT OBLIGATIONS RISK: Government Obligations Risk. The Portfolio may invest in obligationssecurities issued or guaranteed by the U.S. government or its agencies and instrumentalities of the U.S. Government.instrumentalities. These obligations vary
in the level of support they receive from the U.S. Government. Theysecurities may be: (i)
supported by the full faith and credit of the U.S. Treasury, such as those of
the Government National Mortgage Association; (ii) supported by the right of the
issuer to borrow from the U.S. Treasury, such as those of the Federal National
Mortgage Association; (iii) supported by the discretionary authority of the U.S.
Government to purchase the issuer's obligations, such as those of the former
Student Loan Marketing Association; or (iv) supported onlybe backed by the credit of the issuer, suchgovernment as those ofa whole or only by the Federal Farm Credit Bureau. Theissuing agency. No assurance can be given that the U.S. Government may
choose not togovernment would provide financial support to U.S. Government sponsoredits agencies orand instrumentalities if it is not legally obligatedrequired to do so in which case, if the
issuer defaulted, the Portfolio holding securities of such issuer might not be
able to recover its investment from the U.S. Government.
TEMPORARY GUARANTEE PROGRAM FOR MONEY MARKET FUNDS
On October 3, 2008, the Board of Trustees of the Northern Lights Variable Trust
authorized the participation by the Money Market Portfolio in the U.S.
Treasury's (the "Treasury") Temporary Money Market Guarantee Program (the
"Program"),law.
Fees and
the Portfolio currently participates in the Program. Under the
Program, the Treasury guarantees the Portfolio's $1.00 share price for shares
held by a shareholder as of September 19, 2008 if: (1) the Portfolio's net asset
value falls below $0.995 per share; (2) the Portfolio promptly liquidates
thereafter; and (3) the liquidation proceeds are less than $1.00 per share. The
Program protects the lesser of (i) the number of shares held in a shareholder
account in the Portfolio as of the close of business on September 19, 2008 or
(ii) the number of shares held in a shareholder account in the Portfolio on the
date on which the liquidation occurred.
The Program does not cover or protect shares acquired by an investor after
September 19, 2008. Furthermore, the Program's coverage for all participating
mutual funds is currently approximately $50 billion and therefore does not
guarantee investors will receive a $1.00 net asset value upon the liquidation or
redemption of the investor's shares.
The cost to the Portfolio of participation in the Program for the three-month
initial term ended December 18, 2008 was 0.01% of its assets as of September 19,
2008. This expense was borne by the Portfolio outside of the reimbursement
arrangements currently in place. The Program was authorized for an initial
three-month term and has been renewed thereafter by the Treasury for additional
terms, the latest of which ends on September 18, 2009. In no event will the
Program extend beyond September 18, 2009, and any extension may continue to be
limited to covering shareholders of record as of September 19, 2008.
The Board of Trustees has decided that the Program is beneficial to the
Portfolio and its shareholders and has applied to continue its participation
therein through September 18, 2009. The Portfolio will pay an additional 0.015%
of its assets as of September 19, 2008 in order to continue to participate
through September 18, 2009. Additional details regarding the Program are
available at http://www.ustreas.gov.
FEES AND EXPENSES
Expenses The following table describes the annual operating expenses that you indirectly pay if you invest in the Portfolio through your retirement plan or if you allocate your insurance contract premiums or payments to the Portfolio. However, each insurance contract and separate account involves fees and expenses that are not described in this Prospectus. If the fees and expenses of your insurance contract or separate account were included in this table, your overall expenses would be higher. You should review the insurance contract prospectus for a complete description of fees and expenses.
Annual fund operating expenses are paid out of the Portfolio'sPortfolio’s assets and include fees for portfolio management, maintenance of shareholder accounts, shareholder servicing, accounting and other services. You do not pay these fees directly but, as the example shows, these costs are borne indirectly by all shareholders.
--------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM TOTAL PORTFOLIO ASSETS)
------------------------------------------------------------------ -------------
Management Fees 0.15%
------------------------------------------------------------------ -------------
12b-1 Fees 0.00%
------------------------------------------------------------------ -------------
Other Fees(1) 0.55%
------------------------------------------------------------------ -------------
Total Expenses 0.70%
------------------------------------------------------------------ -------------
Less: Expense Waiver/Reimbursement (0.18%)
------------------------------------------------------------------ -------------
Net Expenses(2) 0.52%
------------------------------------------------------------------ -------------
Annual Fund Operating Expenses (expenses that are deducted from total Portfolio assets) |
| Management Fees | 0.15% |
| 12b-1 Fees | 0.00% |
Other Fees(1) | 0.56% |
| Total Expenses | 0.71% |
| Less: Expense Waiver/Reimbursement | (0.02%) |
Net Expenses(2) | 0.69% |
(1) These expenses include custodian, administration, transfer agency and other customary fund expenses, and are based on amounts incurred during each Portfolio'sPortfolio’s most recently completed fiscal year.
(2) The Adviseradviser for JNF Money Market Portfolio has contractually agreed to waive its investment advisory fees and/or reimburse each Portfolio to the extent that the ratio of expenses
(excluding brokerage fees and commissions, acquired fund fees and expenses,
costs associated with the participation in the United States Department of the
Treasury's Temporary Guarantee Program forportfolio at least until April 30, 2011.
NVIT Money Market Funds, borrowing costs
(such as interest and dividend expense on securities sold short), taxes and
extraordinary expenses) to net assets on an annual basis exceeds 0.50% for the
Money Market Portfolio. The Adviser may discontinue this contractual limit at
any time after April 30, 2010 and may recover any amounts waived or reimbursed
under the contract provisions, to the extent that actual fees and expenses are
less that the expense limitation, for a period of three years after the date of
the waiver or reimbursement.
NVIT MONEY MARKET FUND (CLASS I)
--------------------------------
Fund (Class II)
OBJECTIVE
The Fund seeks as high a level of current income as is consistent with preserving capital and maintaining liquidity. PRINCIPAL STRATEGIES
The Fund is a money market fund that seeks to maintain a fixedstable net asset value of $1.00 per share by
investingshare.
PRINCIPAL STRATEGIES
The Fund invests primarily in a portfolio of high-quality, money market obligations maturingfixed income securities that mature in 397 days or less. These money market obligations primarily include:
o commercial paper and other fixed-income securities are issued by banks, corporations and the U.S. government, and may include asset-backed securities as well as obligations of states, municipalities and foreign corporations;
o asset-backed securities comprised of commercial paper;
o U.S. government securities and U.S. government agency securities;
o obligations ofgovernments. The Fund may purchase foreign governments;
o commercial paper issued by states and municipalities and
o obligations of U.S. banks, foreign banks and U.S. branches of foreign
banks.
All of the money market
securities, although all obligations held by the Fund must be denominated in U.S. dollars. The Fund's money market securities also must be rated in one of the two
highest short-term categories by any nationally recognized statistical rating
organization or, if unrated, be of comparable quality.
The Fund may invest in floating-and adjustable-ratefloating and variable-rate obligations and may enter into repurchase agreements. The Fund'sPrior to June 30, 2010, the Fund will maintain a dollar-weighted average MATURITYmaturity of no more than 90 days. Beginning June 30, 2010, the Fund will be
90maintain a
dollar-weighted average maturity of no more than 60 days, or less.and a weighted average life of no more than 120 days. Because the Fund invests in short-term securities, the Fund’s subadviser generally sells securities only to meet liquidity needs, to maintain target allocations or to take advantage of more favorable opportunities. The Fund's adviser has
selected Federated Investment Management Company as subadviser to manage
PRINCIPAL RISKS
Investments in the Fund's portfolio on a day-to-day basis.
PRINCIPAL RISKSFund are not bank deposits and are not insured or guaranteed by the Federal Deposit Insurance
Corporation (FDIC) or any other government agency. While the Fund seeks to preserve capital, there can be no guarantee that the Fund will meet its objective or be able to maintain a fixed net asset value of $1.00 per share; therefore, you could lose money. In order to maintain a constant net asset value of $1.00 per share, the Fund may reduce the number of shares held by its shareholders.
There is no guarantee that the Fund will provide a certain level of income or that any such income will stay ahead of inflation. Investments inFurther, the Fund’s yield will vary; it is not fixed for a specific period like the yield on a bank certificate of deposit. A low interest rate environment may prevent the Fund are
not bank deposits and are not insuredfrom providing a positive yield, or guaranteed bypaying Fund expenses out of current income could impair the Federal Deposit
Insurance Corporation or any other government agency.
Fund’s ability to maintain a stable net asset value.
Other risks of investing in the Fund include, among other things:
INTEREST RATE RISK -include:
Interest rate risk – generally, when interest rates go up, the value of fixed-income securities goes down.
CREDIT RISK - a money market
Credit risk – an issuer may be unable to pay the interest or principal when due. In addition, if an issuer's financial condition changes, the
ratings on the issuer's securities may be lowered, which could negatively affect
the prices of the securities the Fund owns.
PREPAYMENT RISK - certain money market instruments will be paid off by the
issuer more quickly than anticipated. If this happens, the Fund may be required
to invest the proceeds in securities with lower yields.
LIQUIDITY RISK -
Liquidity risk – is the risk that a security cannot be sold, or cannot be sold quickly, at an acceptable price.
ASSET-BACKED SECURITIES RISK -
Asset-backed securities risk – the credit quality of most asset-backedasset backed securities depends primarily on the credit quality of the assets underlying such securities, how well the entity issuing the security is insulated from the credit risk of the originator or any other affiliated entities, and the amount and quality of any credit enhancement of the securities. Asset-based
Repurchase agreements risk – exposes the Fund to the risk that the party that sells the securities may not have the benefit of any security interest in the related asset.
SHARE REDUCTION RISK - in order to maintain a constant net asset value of $1.00
per share, the Fund may reduce the number of shares held bydefault on its shareholders.
OBLIGATIONS OF FOREIGN GOVERNMENTS - certainobligation to repurchase them.
Foreign securities risk – foreign securities may be more volatile, harder to price and less liquid than U.S. securities.
If the value of the Fund'sFund’s investments goes down, you may lose money.
FEES AND EXPENSES
The following table describes the fees and expenses that you may pay when buying and holding shares of the
Fund. The fees and expenses do not include sales charges and other expenses that may be imposed by variable insurance contracts. If these amounts were reflected, the fees and expenses would be higher than shown. Such sales charges and other expenses are described in the variable insurance contract'scontract’s prospectus.
--------------------------------------------------------------------------------
--------------------------------------------------------------------- ----------
Shareholder Fees (paid directly from your investment) N/A
--------------------------------------------------------------------- ----------
Annual Fund Operating Expenses (deducted from
Fund assets)
--------------------------------------------------------------------- ----------
Management Fees 0.38%
--------------------------------------------------------------------- ----------
Distribution and/or Service (12b-1) Fees N/A
--------------------------------------------------------------------- ----------
Other Expenses (1) 0.26%
--------------------------------------------------------------------- ----------
TOTAL ANNUAL FUND OPERATING EXPENSES (before Fee Waivers/Expense 0.64%
Reimbursements)
--------------------------------------------------------------------- ----------
Amount of Fee Waiver/Expense Reimbursement N/A
--------------------------------------------------------------------- ----------
TOTAL ANNUAL FUND OPERATING EXPENSES (after Fee Waivers/Expense 0.64%
Reimbursements)
--------------------------------------------------------------------- ----------
(1) "Other Expenses" include administrative services fees which currently are
0.15%, but which are permitted to be as high as 0.25%. The full amounts of
administrative services fees are not reflected in "Other Expenses" for Class I
shares at this time because, until at least May 1, 2010, the Fund does not
intend to pay insurance companies a higher amount. If the full amounts of
administrative services fees were charged, total operating expenses, after fee
waivers and/or reimbursements, would be 0.74%.
"Other Expenses" also includes payment by the Fund through September 18, 2009
of an amount equal to 0.03% of the value of the Fund's net assets as of
September 19, 2008 to participate in the United States Department of the
Treasury's Temporary Guarantee Program for
|
| Shareholder Fees (paid directly from your investment) | N/A |
Annual Fund Operating Expenses (deducted from Fund assets) | |
| Management Fees | 0.38% |
| Distribution and/or Service (12b-1) Fees | 0.25% |
| Other Expenses | 0.24% |
| Acquired Fund Fees and Expenses | 0.02% |
| TOTAL ANNUAL FUND OPERATING EXPENSES (before Fee Waivers/Expense Reimbursements) | 0.89% |
| Amount of Fee Waiver/Expense Reimbursement | N/A |
| TOTAL ANNUAL FUND OPERATING EXPENSES (after Fee Waivers/Expense Reimbursements) | 0.89% |
Rydex Variable Trust U.S. Government Money Market
Funds.
RYDEX VARIABLE TRUST U.S. GOVERNMENT MONEY MARKET FUND
------------------------------------------------------
Fund
OBJECTIVE
The Fund seeks to provide security of principal, high current income, and liquidity.
PRINCIPAL INVESTMENT STRATEGY
The U.S. Government Money Market Fund invests primarily in money market instruments issued or guaranteed as to principal and interest by the U.S. Government, its agencies or instrumentalities, and enters into repurchase agreements fully collateralized by U.S. Government securities. The Fund may also invest in 2a-7 eligible securities, including, but not limited to Eurodollar Time Deposits, securities issued by the International Bank for Reconstruction and Development (the World Bank), and high-quality commercial paper certificates of deposit and short-term corporate bonds. The Fund operates under U.S. Securities and Exchange Commission rules, which impose certain liquidity, maturity and diversification requirements on all money market funds. All securities purchased by the Fund must have remaining maturities of 397 days or less, and must be found by the Advisor to represent minimal credit risk and be of eligible quality.
Under normal circumstances, the Fund will invest at least 80% of its net assets in fixed income securities issued by the U.S. government. This is a
non-fundamental policy that can be changed by the Fund upon 60 days' prior
notice to shareholders.
government..
PRINCIPAL RISKS
The U.S. Government Money Market Fund is subject to a number of risks that may affect the value of its shares, including:
o
• Interest Rate Risk
o
• Stable Price Per Share Risk
o
• Credit Risk
o
• Income Risk
INTEREST RATE RISK -– The market value of fixed income investments, and financial instruments related to those fixed income investments, will change in response to interest rate changes. During periods of falling interest rates, the values of fixed income securities generally rise. Conversely, during periods of rising interest rates, the values of such securities generally decline. While
securities with longer maturities tend to produce higher yields, the prices of
longer maturity securities are also subject to greater market fluctuations as a
result of changes in interest rates. However, the extremely short maturity of
securities held in the Fund, certain of the underlying funds -- a means of
achieving an overall Fund objective of principal safety -- reduces the
likelihood of price fluctuation.
STABLE PRICE PER SHARE RISK -– The U.S. Government Money Market Fund is subject to Stable Price Per Share Risk. The U.S. Government Money Market Fund'sFund’s assets are valued using the amortized cost method, which enables the U.S. Government Money Market Fund to maintain a stable price of $1.00 per share. Although the U.S. Government Money Market Fund is managed to maintain a stable price per share of $1.00, there is no guarantee that the price will be constantly maintained, and it is possible to lose money. The U.S. Government Money Market Fund is not a bank deposit and is not federally insured or guaranteed by any government agency or guaranteed to achieve its objective.
CREDIT RISK -– Credit risk is the risk that the Fund could lose money if the issuer or guarantor of a debt instrument becomes unwilling or unable to make timely principal and/or interest payments, or to otherwise meet its obligations.
Securities are subject to varying degrees of credit risk, which are sometimes
reflected in credit ratings.
INCOME RISK
-– Income Risk involves the potential for decline in the
Fund'sFund’s yield (the rate of dividends the Fund or the underlying fund pays) in the event of declining interest rates.
FUND FEES AND EXPENSES
The tables below describe the fees and expenses that you may pay if you buy and hold shares of the Funds. Owners of variable annuity and insurance contracts that invest in the funds should refer to the variable insurance contract prospectus for a description of fees and expenses, as the tables and examples do nonot reflect deductions at the separate account level or contract level for any charges that may be incurred under a contract. If the tables and examples were to reflect the deduction of insurance charges, fees and expenses would be higher.
--------------------------------------------------------------------- ----------
Annual Fund Operating Expenses (deducted from Fund assets) | |
| Management Fees | 0.50% |
| Distribution and/or Service (12b-1) Fees | N/A |
Other Expenses (1) | 0.78% |
| TOTAL ANNUAL FUND OPERATING EXPENSES (before Fee Waivers/Expense Reimbursements) | 1.28% |
| Amount of Fee Waiver/Expense Reimbursement | N/A |
| TOTAL ANNUAL FUND OPERATING EXPENSES (after Fee Waivers/Expense Reimbursements) | 1.22% |
SBL Fund Operating Expenses (deducted from
Fund assets)
--------------------------------------------------------------------- ----------
Management Fees 0.50%
--------------------------------------------------------------------- ----------
Distribution and/or Service (12b-1) Fees N/A
--------------------------------------------------------------------- ----------
Other Expenses (1) 0.75%
--------------------------------------------------------------------- ----------
TOTAL ANNUAL FUND OPERATING EXPENSES (before Fee Waivers/Expense 1.22%
Reimbursements)
--------------------------------------------------------------------- ----------
Amount of Fee Waiver/Expense Reimbursement N/A
--------------------------------------------------------------------- ----------
TOTAL ANNUAL FUND OPERATING EXPENSES (after Fee Waivers/Expense 1.22%
Reimbursements)
--------------------------------------------------------------------- ----------
SBL FUND SERIESSeries C (MONEY MARKET)
--------------------------------
(Money Market)
INVESTMENT OBJECTIVE
Series C seeks as high a level of current income as is consistent with preservation of capital by investing in money market securities with varying maturities.
PRINCIPAL INVESTMENT STRATEGIES
Series C pursues its objective by investing in a diversified and liquid portfolio of high-quality money market instruments, which may include restricted securities as discussed under "Principal“Principal Risks."” Generally, the Series is required to invest at least 95% of its assets in the securities of issuers with the highest short-term credit rating, and the remainingit may not invest more than 3% of its assets may be invested in securities with the second-highest short-term credit rating. The Series is not designed to maintain a constant net asset value of $1.00 per share and it may not maintain a positive yield, and it is possible to lose money by investing in the Series. The Series is subject to certain portfolio quality requirements and portfolio maturity, diversification and liquidity requirements under the federal requirements which includesecurities laws, including the following:
o Maintain an average dollar-weighted portfolio maturity of 90 days or
less
o Buy individual securities that have remaining maturities of 13 months
or less
o Invest only in high-quality, dollar-denominated, short-term
obligations
| · | Maintain a dollar-weighted average portfolio maturity of 60 calendar days or less and a dollar-weighted average life to maturity of 120 calendar days or less |
| · | Invest only in high-quality, dollar-denominated, short-term obligations |
A money market instrument is a short-term debt instrument issued by banks or other U.S. corporations, or the U.S. government or state or local governments. Money market instruments have limited maturity dates of 13 months or less and may include certificates of deposit, bankers'bankers’ acceptances, variable rate demand notes, fixed-term obligations, commercial paper, asset-backed commercial paper and repurchase agreements.
The Investment Manager
Security Investors, LLC (the “Investment Manager”) attempts to increase return and manage risk by (1)
maintaining an average dollar-weighted portfolio maturity within 10 days of the
Series' benchmark, the Money Fund Report published by iMoneyNet, Inc.; (2) selecting securities that mature at regular intervals over the life of the portfolio; (3)(2) purchasing only commercial paperinstruments that have received a rating from the requisite NRSRO’s in one of the top two tiers;highest short-term categories or an unrated security that is of comparable quality; and (4)(3) constantly evaluating alternative investment opportunities for diversification without additional risk.
PRINCIPAL RISKS
Principal Risks — An investment in the Series is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. The value of an investmentIt is possible to lose money by investing in the Series will fluctuate and
is subject to investment risks, which means investors could lose money.Series. The principal risks of investing in the FundSeries are listed below.
CREDIT RISK.
Credit Risk. The Series could lose money if the issuer of a bond is unable to repay interest and principal on time or defaults. The issuer of a bond could also suffer a decrease in quality rating, which would affect the volatility and liquidity of the bond.
INTEREST RATE RISK.
Interest Rate Risk. Investments in fixed-income securities are subject to the possibility that interest rates could rise sharply, causing the value of the Series'Series’ securities and share prices to decline. Fixed income securities with longer durations are subject to more volatility than those with shorter durations.
PREPAYMENT RISK.
Liquidity Risk. Although the Series primarily invests in a diversified portfolio of high quality instruments of governmental and private issuers, the Series’ investments may become less liquid as a result of market developments or adverse investor perception.
Prepayment Risk. Securities subject to prepayment risk generally offer less potential for gains when interest rates decline, because issuers of the securities may be able to prepay the principal due on the securities, and may offer a greater potential for loss when interest rates rise.
RESTRICTED SECURITIES RISK.
Regulatory Risk. Regulations of money market funds are evolving. New regulations may affect negatively the Series’ performance, yield and cost.
Restricted Securities Risk. Restricted securities generally cannot be sold to the public and may involve a high degree of business and financial risk, which may result in substantial losses to the Series. ANNUAL OPERATING EXPENSES
The table below reflects expenses that are deducted from Series assets. The table below does not reflect the fees and expenses of the variable insurance product through which shares of the Series are purchased. If such fees and expenses were reflected, the overall expenses would be higher.
----------------------------------------------------------------------
Advisory fee.................................... 0.50%
Other expenses.................................. 0.15%
TOTAL ANNUAL OPERATING EXPENSES................. 0.65%
----------------------------------------------------------------------
| Advisory fee | 0.50% |
| Other expenses | 0.17% |
| Total annual operating expenses | 0.67% |
APPENDIX B
(NEED TO COMPLETE after Record Date)
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL AND RECORD OWNERS
THE FOLLOWING TABLES PROVIDE INFORMATION ABOUT THE PERSONS OR ENTITIES WHO, TO
THE KNOWLEDGE OF THE FUND, OWNED BENEFICIALLY OR OF RECORD
The following tables provide information about the persons or entities who, to the knowledge of the Fund, owned beneficially or of record 5% OR MORE OF ANY
CLASS OF THAT FUND'S OUTSTANDING SHARES AS OF FEBRUARY 16, 2010:
or more of any class of that Fund’s outstanding shares as of February 25, 2011:
------------------------------------------------------ -------------------- ------------------------------
PERCENT OF CLASS
NAME AND ADDRESS OF SHAREHOLDER OF SHARES AND TYPE PERCENTAGE OF FUND
OF OWNERSHIP
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
------------------------------------------------------ -------------------- ------------------------------
Name and Address of Shareholder | Percent of Class of Shares and Type of Ownership | Percentage of Fund |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
APPENDIX C
MULTI-CAP CORE EQUITY
INTERNATIONAL LONG SHORT SELECT FUND
PLAN OF LIQUIDATION AND DISSOLUTION OF SERIES
This Plan of Liquidation and Dissolution of Series (the "Plan"“Plan”) is made
byconcerns the International Long Short Select Fund (the “Fund”), a series of Rydex Variable Trust (the "Trust"“Trust”),. The Trust is organized and existing as a Delaware businessstatutory trust with respect
to Multi-Cap Core Equity Fund (the "Fund"), a separate series of shares of
beneficial interest, and a segregated portfolio of assets,under the laws of the Trust.State of Delaware. The FundTrust is a series ofregistered with the U.S. Securities and Exchange Commission (the “SEC”) as an open-end management investment company registered under the Investment Company Act of 1940, as amended (the "1940 Act"“Act”). ThisThe Fund began operations on March 27, 2008. The Plan is intended to accomplish the complete liquidation and dissolution of the Fund in conformity with all provisionsthe laws of the State of Delaware, law, the 1940 Act, the Internal Revenue Code of 1986, as amended (the "Code"“Code”), and the Trust'sTrust’s Declaration of Trust datedand Amended and Restated Bylaws (“Organizational Documents”). All references in this Plan to action taken by a Fund shall be deemed to refer to action taken by the 11th day of June, 1998, as amended (the "Declaration of Trust").
WHEREAS, the Trust's Board of Trustees (the "Trustees") have
determined,Trust on behalf of the Fund.
WHEREAS, Security Investors, LLC (the “Advisor”) has recommended to the Board of Trustees of the Trust (the “Board”) that the Fund be terminated, liquidated and dissolved; and
WHEREAS, the Board has considered the impact on the Fund’s shareholders of the termination and liquidation of the Fund; and
WHEREAS, the Board has determined that itthe termination, liquidation and dissolution of the Fund is advisable and in the best interests of the shareholders of the Fund, and its shareholders to liquidatehas considered and dissolve the Fund; and
WHEREAS, at a meeting of the Trustees on February 12, 2010,approved this Plan as the method of liquidatingaccomplishing such actions; and dissolving the Fund in accordance with
applicable provisions of Delaware law and the Trust's Declaration of Trust,
including but not limited
WHEREAS, pursuant to Section 11.0411.04(c) of the Declaration of Trust, was
consideredthe Board may at any time sell and adopted.
convert into money all of the assets of any series of the Trust and after making reasonable provision for the payment of all such liabilities, distribute the remaining proceeds or assets of the series ratably among the shareholders of the series if a majority of the Trustees determines that the continuation of the series is not in the best interests of the series and its shareholders as a result of factors or events adversely affecting the ability of the series to conduct its business and operations in an economically viable manner.
NOW THEREFORE, the termination, liquidation and dissolution of the Fund shall be carried out in the manner hereinafter set forth.
forth herein:
1.Effective Date of Plan.Plan. This Plan shall be and become effective immediatelyonly upon a
vote approvingthe adoption and approval of the Plan, by the requisite numberaffirmative vote of a majority of Trustees of the outstanding sharesTrust and a majority of the Fund entitled to vote at a special meetingFund’s shareholders. The day of shareholders of the Fund duly
called for such purpose to be held on April 7, 2010, or such other date as
determined by an officer of the Fund, which dateadoption and approval is hereinafter called the "Effective Date"“Effective Date.”
2.Liquidation and Termination. ThisConsistent with the provisions of this Plan, shall not become effective if it has not been
approved by a majority of the shares of the Fund outstanding and entitled to
vote.
2. Liquidation. As soon as practicable following the Effective Date, the Fund shall be liquidated on or about April 25, 2011, or as promptly as practicable in accordance with Sectionits Organizational Documents and all applicable law, including but not limited to Sections 331 and 332 of the Code (the "Liquidation"“Liquidation”, and the date on which the final liquidating distribution is made, the “Liquidation Date”).
3. CessationNotice of Business.Liquidation. As soon as is reasonable and practicable after the adoption of this Plan, the Fund shall provide notice to the Fund’s shareholders and other appropriate parties that this Plan has been approved by the Board and that the Fund will be liquidating its assets.
4.Cessation of Business. As soon as reasonably practicable on or after the Effective Date, the Fund shall close to new investments and shall cease its regular business as series of a registered investment company and shall not engage in any business activities except for the purposes of winding up itsthe Fund’s business and affairs, preserving the value of its assets, and shall distribute the Fund'sdistributing its respective assets to its shareholders in the Fund in accordance with the provisions of this Plan;Plan after discharging or making reasonable provision for the Fund’s liabilities; provided, however, that the Fund may continue to carry on any activities necessary to maintain its activitiesstatus as ana regulated investment company as described in its current prospectus, with regard to its
shareholders and assets, until the final liquidating distribution to its
shareholders has been made.
4. Restriction of Transfer and Redemption of Shares. The proportionate interests
of shareholders in the assetsunder Subchapter M of the Fund shall be fixed on the basisCode.
5.Payment of their
respective shareholdings at the close of business on April 23, 2010, or such
other date as determined by the Bard. On such date, the books of the Fund shall
be closed. Thereafter, unless the books are reopened because the Plan cannot be
carried into effect under the laws of Delaware or otherwise, the shareholders'
respective interests in the Fund' assets shall not be transferable or
redeemable.
5. Liquidation of Assets.Debts. As soon as it is reasonable and practicable after the Effective Date, the Fund shall determine and pay in full or suchdischarge, or make reasonable provision to pay or discharge, including by establishment of a liquidating trust, escrow or reserve on the books of the Fund or other date asreasonable means determined by the Board, (the "Liquidation
Date"),Fund, all portfolio securitiesclaims and obligations, including, without limitation, all contingent, conditional or unmatured claims and obligations known to the Fund, all claims and obligations that are known to the Fund but for which the identity of the claimant is unknown, and all claims and obligations that have not been made known to the Trust or that have not arisen but that, based on the facts known to the Trust, are likely to arise or to become known to the Trust within 10 years after the date of dissolution (each a “Liability” and collectively, the “Liabilities”). To the extent the Fund cannot pay or discharge a Liability prior to the Liquidation Date, then not already convertedlater than the Liquidation Date the Fund may grant, assign, convey, transfer and contribute such unresolved Liability to the Liquidating Trust referred to in Section 10 below, along with such amounts of cash and other assets as the Fund shall determine might reasonably be required to resolve such unresolved Liability.
6.Liquidation of Assets. As soon as reasonable and practicable after the Effective Date, the Advisor and sub-adviser for the Fund shall use all commercially reasonable efforts to sell all of the Fund’s portfolio assets for cash no later than April 15, 2011 and shall hold or reinvest the proceeds thereof in cash and such short-term securities as the Fund may lawfully hold or invest in. Following the Effective Date and prior to the Liquidation Date, the Fund shall have the authority to engage in such transactions as may be appropriate to complete liquidation and dissolution, including without limitation, the authority to mortgage, pledge, sell, lease, exchange or otherwise dispose of all or any part of its other assets for cash and/or shares, bonds or other securities or property upon such terms and conditions as the Fund or the Advisor and sub-adviser (if any) shall determine, with no further approvals by the Board except as required by law. To the extent the Fund cannot dispose of an asset prior to the Liquidation Date, including in particular any rights associated with securities class action claims of which the Fund is a class member or putative class member, the Fund shall grant, assign, convey, transfer and contribute such asset (each, a “Remaining Asset” and collectively, the “Remaining Assets”) to the Liquidating Trust referred to in Section 10 below.
7.Liquidating Distribution. As soon as reasonable and practicable after the Fund’s assets have been reduced to cash or cash equivalents, but no later than April 25, 2011, the Fund shall be converteddistribute pro rata to cash or cash equivalents.
6. Liabilities. Between the Effective Date andFund’s shareholders of record as of the close of business on the Liquidation Date (the
"Liquidation Period"), the Fund shall pay, discharge, or otherwise provide for
the payment or discharge of, any and all liabilities and obligations of the Fund. IfFund’s then existing assets in complete and full cancellation and redemption of all the Fund is unable to pay, discharge or otherwise provide for any
liabilitiesoutstanding shares of the Fund, during the Liquidation Period, the Fund mayexcept for (i) retain
cash, bank deposits, or cash equivalentsequivalent securities in an estimated amount that it estimates is necessary toto: (a) discharge any unpaid liabilities and obligations of the Fund on the Fund'sFund’s books as ofon the Liquidation Date, including, but not limited to, income dividends and capital gains distributions, if any, payable for the period prior tothrough the Liquidation Date,Date; and (ii)(b) pay such contingent liabilities as the TrusteesBoard shall reasonably deem to exist against the assets of the Fund on the Fund's books.
7. Distribution to Shareholders. On the Liquidation Date, the Fund's assets will
be distributed ratably among the Fund's shareholders of record in oneFund’s books, and (ii) any Remaining Assets or more
cash payments which shall immediately be allocated to Northern Lights Variable
Trust JNF Money Market Portfolio, NVIT Money Market Fund, Rydex Variable Trust
U.S. Government Money Market Fund or SBL Fund Series C (Money Market), as
applicable. The first distribution of the Fund's assets is expected to consist
of cash representing substantially all theother assets of the Fund lessthat are contributed to the amount
reservedLiquidating Trust referred to pay creditors of the Fund.
If the Trustees are unable to make distributions to all of the Fund's
shareholders because of the inability to locate shareholders to whom
distributions in cancellation and redemption of Fund shares are payable, the
Trustees may create, in the name and on behalf of the Fund, a trust with a
financial institution and, subject to applicable abandoned property laws,
deposit any remaining assets of the Fund in such trust for the benefit of the
shareholders.
Section 10 below. 8. Receipt of Cash or Other Distributions After the Liquidation Date. Following
the Liquidation Date, if the Fund receives any form of cash or is entitled to
any other distributions that it had not recorded on its books on or before the
Liquidation Date, except as otherwise described below, such cash or other
distribution will be disbursed in the following manner:
a. The Trust will determine the shareholders of record of the Fund as
of the Effective Date of the Plan.
b. The Trust will then identify the shareholders of record as of the
Effective Date who would be entitled to a pro rata share of the cash
or distribution received by the Fund (net of all expenses associated
with effecting the disposition of such cash or distribution).
c. The Trust will then be responsible for disbursing to each such
shareholder of record, identified in accordance with paragraph 8.b
above, their pro rata portion of the cash or distribution in
accordance with paragraph 7 above.
d. If there are no shareholders entitled to receive such proceeds, any
cash or distribution will be distributed proportionately among the
remaining Fund of the Trust based on the net assets of each Fund.
9. Satisfaction of Federal Income and Excise Tax Distribution Requirements. At
or immediately prior toRequirements. If necessary, the Fund shall, by the Liquidation Date, the Fund shall, if necessary, have declared and paid a dividend or dividends which, together with all previous such dividends, shall have the effect of distributing to the Fund’s shareholders of the Fund all of the Fund'Fund’s investment company taxable income for the taxable years ending at or prior to the Liquidation Date (computed without regard to any deduction for dividends paid), and all of itsthe Fund’s net capital gain, if any, realized in the taxable years ending at or prior to the Liquidation Date (after reduction for any capital loss carry-forward) and any additional amounts necessary to avoid any excise tax for such periods. 10. PowersAlternatively, the Fund may, if eligible, treat all or any portion of Trustees.the amounts to be distributed pursuant to this Section 8 as having been paid out as part of the liquidating distributions made to the Fund’s shareholders pursuant to Section 7.
9.Expenses in Connection with this Plan. The Trust'sFund will bear the costs incurred in connection with the Liquidation, but only to the extent such costs do not exceed the Total Annual Fund Operating Expenses of the Fund, as stated in the Fund’s current prospectus, as supplemented. Any expenses and liabilities attributed to a Fund in excess of the Fund’s Total Annual Operating Expenses will be borne by Security Investors, LLC, with the exception of those expenses of the Liquidating Trust, if any, expressly assumed by the beneficial owners of the liquidating trust, as set forth in the Liquidating Trust Agreement (defined in Section 10 below). Notwithstanding the foregoing, the Fund’s shareholders will pay their own expenses, if any, incurred in connection with the receipt of any proceeds of the Liquidation.
10.Liquidating Trust. The Board may, if the Board in its absolute discretion deems it necessary, appropriate or desirable, establish with one or more trustees selected by the Board, a liquidating trust (the “Liquidating Trust”)
pursuant to a liquidating trust agreement (the “Liquidating Trust Agreement”), which Liquidating Trust may include one or more separate series. Upon establishment of the Liquidating Trust, the Board shall (i) grant, assign, convey, transfer and contribute to the trustees of the Liquidating Trust all Remaining Assets of a Fund and any other assets of the Fund not yet distributed to the shareholders of the Fund, (ii) grant, assign, convey, transfer and contribute all unresolved Liabilities of the Fund to the Liquidating Trust, along with such amounts of cash and other assets as the Fund shall determine might reasonably be required to resolve such unresolved Liabilities, and (iii) distribute interests in a series of the Liquidating Trust that corresponds to the Fund, pro rata to such Fund’s shareholders of record as of the close of business on the Effective Date.
a.No distributions of any assts held by the trustees of the Liquidating Trust shall be made by such trustees other than as provided by the express terms and provisions of the Liquidating Trust Agreement, and no assets held by the trustees of the Liquidating Trust shall ever revert or be distributed to a Fund or to any shareholder thereof, as such, other than a former shareholder of record entitled thereto as provided in the Liquidating Trust Agreement. Assets held in the Liquidating Trust shall be distributed to the beneficiaries of the Liquidating Trust at the time and under the conditions set forth in the express terms and provisions of the Liquidating Trust Agreement.
b.It is intended that each series of the Liquidating Trust will constitute a liquidating trust that is owned by the former shareholders of record of the particular Fund to which such series relates for federal income tax purposes. Accordingly, for federal income tax purposes, it is intended that the assignment of the Remaining Assets and other assets of a Fund to the trustees of the Liquidating Trust shall, subject to the terms and conditions of the Liquidating Trust Agreement, constitute a final liquidating distribution by a Fund to its shareholders of record of their pro rata interests in such assets, followed by such shareholders’ contribution of their pro rata interests in such assts to the corresponding series of the Liquidating Trust.
11.Restriction on Transfer and Redemption of Shares. The proportionate interests of shareholders in the assets of the Fund shall be fixed on the basis of their respective shareholdings at the close of business on the day prior to the Liquidation Date. On the Liquidation Date, the books of the Fund shall be closed. Thereafter, unless the books are reopened because the Plan cannot be carried into effect under the laws of the State of Delaware or otherwise, the shareholders’ respective interests in the Fund’s assets shall not be transferable.
12.Power of Board of Trustees. The Board and, subject to the direction of the Trustees, itsBoard, the officers of the Trust, shall have authority to do or authorize any or all acts and things as provided for in thisthe Plan and any and all such further acts and things as they may consider necessary or desirable to carry out the purposes of the Plan, including without limitation, the execution and filing of all certificates, documents, information returns, tax returns forms and other papers which may be necessary or appropriate to implement the Plan or which may be required by the
provisions of the 1940 Act or any other applicable laws.Plan. The death, resignation or disability of any Trusteetrustee or any officer of the Trust shall not impair the authority of the surviving or remaining Trusteestrustees or officers to exercise any of the powers provided for in the Plan.
11.
13.Filings. The Board hereby authorizes the appropriate parties to make any necessary or appropriate filings relating to the liquidation and/or dissolution of the Fund with the State of Delaware, the Internal Revenue Service (the “IRS”), the SEC, or with any other appropriate authority. Without limiting the generality of the foregoing, the officers of the Fund are authorized and directed to file or cause to be filed Form 966 with the Internal Revenue Service within 30 days of adoption of this Plan.
14.Amendment of Plan.Plan. The TrusteesBoard shall have the authority at any time to authorize variations from or amendments to the provisions of thethis Plan as may be necessary or appropriate to effect the liquidation of the Fund, andFunds, the distribution of the Fund'sFunds’ net assets to itstheir shareholders in accordance with the laws of the State of Delaware, the 1940 Act, the Code, and the DeclarationFund’s Organizational Documents, and the winding up of Trust,the affairs of the Fund, if the Trustees determineBoard determines that such action would be advisable and in the best interests of the Fund and its shareholders. 12. Termination of Plan. ThisThe Board may abandon this Plan and the transactions contemplated hereby may
be terminated and abandoned by resolution of the Trustees at any time priorwith respect to the Liquidation DateFund if circumstances should developit determines that abandonment would be advisable and in the opinion of the
Trustees in their sole discretion, make proceeding with this Plan inadvisable
for the Fund.
13. Filings. As soon as practicable after the final distribution of the Fund's
assets to shareholders, the Trust shall file a notice of liquidation and
dissolutionbest interests of the Fund and any other documents as are necessary to effect the
liquidation and dissolution of the Fund in accordance with the requirements of
the Trust's Declaration ofits shareholders.
Rydex Variable Trust
Delaware law, the Code, any applicable
securities laws, and any rules and regulations of the U.S. Securities and
Exchange Commission or any state securities commission, including, without
limitation, withdrawing any qualification to conduct business in any state in
which the Fund is so qualified, as well as the preparation and filing of any tax
returns, including, but not limited to the Fund' final income tax returns, Forms
966, 1096 and 1099.
14. Further Assurances. The Trust shall take such further action, prior to, at,
and after the Liquidation Date, as may be necessary or desirable and proper to
consummate the transactions contemplated by this Plan.
15. Governing Law. This Plan shall be governed and construed in accordance with
the laws of Delaware.
RYDEX VARIABLE TRUST
on behalf of Multi-Cap Core Equity Fund
By:
--------------------------------------
Name:
Title:
RYDEX VARIABLE TRUST
9601 BLACKWELL RD., SUITE 500
ROCKVILLE, MARYLAND
805 King Farm Boulevard, Suite 600
Rockville, Maryland 20850
PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS
APRIL 7, 2010
April 11, 2011
The undersigned hereby appoint(s) Joanna Haigney, Nick Bonos, and Michael Byrum,Amy Lee, or any one of them, proxies, each of them with full power of substitution, to vote and act with respect to all shares of Multi-Cap Core EquityInternational Long Short Select Fund (the "Fund"“Fund”) which the undersigned is entitled to vote at the Special Meeting of shareholders of the Fund to be held at the offices of Rydex Investments, 9601
Blackwell Road,805 King Farm Boulevard, Suite 500,600, Rockville, Maryland 20850 on April 7, 201011, 2011 at 3:1:00 p.m., Eastern Time,, and at any adjournment(s) or postponements thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.TRUSTEES. This proxy card will be voted as instructed. IF NO SPECIFICATION IS MADE, THE PROXY CARD WILL BE
VOTED "FOR" PROPOSAL 1. THE PROXIES ARE AUTHORIZED, IN THEIR DISCRETION, TO VOTE
UPON SUCH MATTERS AS MAY COME BEFORE THE SPECIAL MEETING OR ANY ADJOURNMENTS.
VIf no specification is made, the proxy card will be voted “FOR” Proposal 1. The proxies are authorized, in their discretion, to vote upon such matters as may come before the Special Meeting or any adjournments.
▼ FOLD AND DETACH HERE V
.................................................................................
MULTI-CAP CORE EQUITY▼
INTERNATIONAL LONG SHORT SELECT FUND
(THE "FUND"
(the “Fund”)
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD APRIL 7, 2010
Special Meeting of Shareholders to be held April 11, 2011
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING PROPOSAL
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Please vote, date and sign this proxy card and return it promptly in the enclosed envelope. Please indicate your vote by an "x"“x” in the appropriate boxes below:
To approve the Plan of Liquidation and Dissolution, providing for the liquidation and dissolution of Multi-Cap Core EquityInternational Long Short Select Fund.
FOR AGAINST ABSTAIN
| | | | | |
PLEASE VOTE BY |X|
CHECKING THE
APPROPRIATE BOX
AS IN THIS EXAMPLE
| PLEASE VOTE BY CHECKING THE APPROPRIATE BOX AS IN THIS EXAMPLE | x |
Signature: __________________________________________________ Signature (if held jointly):_____
____________________________
Date: ___________________________ Date: ___________________________
This proxy must be signed exactly as your name(s) appears hereon. If as an attorney, executor, guardian or in some representative capacity or as an officer of a corporation, please add titles as such. Joint owners must each sign. By signing this proxy card, you acknowledge that you have received the proxy statement that the proxy card accompanies.
PROXY VOTING INSTRUCTIONS
Your mailed proxy statement provides details on important issues relating to your Fund. THE BOARD OF TRUSTEES OF RYDEX VARIABLE TRUST RECOMMENDS THAT YOU
VOTE "FOR" THE PROPOSAL.
The Board of Trustees of Rydex Variable Trust recommends that you vote “FOR” the proposal.
To make voting faster and more convenient for you, we are offering a variety of ways to vote your proxy. You may vote using the Internet or by telephone instead of completing and mailing the enclosed proxy card. The Internet and telephone are generally available 24 hours a day and your vote will be confirmed and posted immediately. Use whichever method is most convenient for you! If you choose to vote via the Internet or by phone, you should not mail your proxy card.
WAYS TO VOTE YOUR SHARES
Ways to Vote Your Shares
Your vote is important no matter how many shares you own. Voting your shares early will avoid costly follow-up mail and telephone solicitation.
Online 1. Click on www.proxyonline.com.
2. Enter the 12 digit control number.
3. Follow the instructions on the Web site.
4. Once you have voted, you do not need to mail your
proxy card.
By Phone 1. Call toll-free 866-796-7186.
2. Enter the 12 digit control number.
3. Follow the recorded instructions.
4. Once you have voted, you do not need to mail your
proxy card
By Mail Complete and sign your proxy card and mail it in
the postage-paid envelope received with your
shareholder mailing. To ensure your vote is validated
properly, please sign your proxy card as described in
the "Instructions for Signing Proxy Cards" section of
your proxy materials.
In Person The Shareholder Meeting will take place April
7, 2010, at 3:00 p.m., Eastern Time, at the offices of
Rydex Investments, 9601 Blackwell Road, Suite 500,
Rockville, Maryland 20850 .
V
| Online | 1. Click on www.proxyonline.com. 2. Enter the 12 digit control number. 3. Follow the instructions on the Web site. 4. Once you have voted, you do not need to mail your proxy card. |
| By Phone | 1. Call toll-free 866-458-9863. 2. Enter the 12 digit control number. 3. Follow the recorded instructions. 4. Once you have voted, you do not need to mail your proxy card |
| By Mail | Complete and sign your proxy card and mail it in the postage-paid envelope received with your shareholder mailing. To ensure your vote is validated properly, please sign your proxy card as described in the “Instructions for Signing Proxy Cards” section of your proxy materials. |
| In Person | The Shareholder Meeting will take place April 11, 2011, at 1:00 p.m., Eastern Time, at the offices of Rydex Investments, 805 King Farm Boulevard, Suite 600, Rockville, Maryland 20850. |
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Questions?
We urge you to spend time reviewing your proxy statement and the proposal included in the package. Should you have any questions, we encourage you to call 1-800-361-27821-877-864-5058 toll-free Monday through Friday from 9:30 a.m. to 10:00 p.m. Eastern Time. We have retained The Altman Group to assist our shareholders in the voting process. If we have not received your proxy card or vote as the date of the special meeting approaches, representatives from The Altman Group may call you to remind you to exercise your vote.
YOUR PROXY VOTE IS IMPORTANT! PLEASE VOTE TODAY