SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Com-
mission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Revised Materials
[ ] Soliciting Material Pursuant to Section 140.14a-12
VAN KAMPEN BOND FUND
(Names of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed per Exchange Act Rules 14a-6(i)(1) and 0-11.
[ ] Fee paid previously with preliminary materials.
-- MAY 2007 --
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IMPORTANT NOTICE
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TO VAN KAMPEN
BOND FUND SHAREHOLDERS
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QUESTIONS & ANSWERS
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Although we recommend that you read the complete Proxy Statement, we have
provided for your convenience a brief overview of the issues to be voted on.
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Q WHY IS A SHAREHOLDER
MEETING BEING HELD?
A The purposes of the
meeting of shareholders of Van Kampen Bond Fund (the "Fund") are to elect
nominees to the Board of Trustees and to seek the approval of shareholders to
replace a fundamental policy of the Fund with a non-fundamental policy.
Q WHAT PROPOSAL WILL BE
VOTED ON?
A You are being asked to
(i) elect nominees for the Board of Trustees of the Fund and (ii) vote on a
proposal to replace the Fund's fundamental policy regarding the Fund's ability
to invest in securities or obligations of foreign issuers with a non-
fundamental policy.
Q WILL MY VOTE MAKE
A DIFFERENCE?
A Yes, your vote is important
and will make a difference no matter how many shares you own. We encourage all
shareholders to participate in the governance of their Fund.
Q HOW DOES THE BOARD OF
TRUSTEES RECOMMEND THAT I VOTE?
A After careful consideration,
the Board of Trustees recommends that you vote "FOR ALL" of the nominees and
"FOR" the proposal replacing one of the Fund's fundamental policies with a
non-fundamental policy on the enclosed proxy card.
Q HOW DO I VOTE MY PROXY?
A You may cast your vote by
mail, phone or internet. To vote by mail, please mark your vote on the enclosed
proxy card and sign, date and return the card in the postage-paid envelope
provided. If you choose to vote via phone or internet, please refer to the
instructions found on the proxy card accompanying this Proxy Statement. To vote
by phone or internet, you will need the "control number" that appears on the
proxy card.
Q WHERE DO I CALL FOR
MORE INFORMATION?
A Please call Van Kampen's
Client Relations Department at 1-800-341-2929 or visit our website at
www.vankampen.com, where you can send us an e-mail message by selecting "Contact
Us."
ABOUT THE PROXY CARD
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Please vote on each issue using blue or black ink to mark an X in one of the
boxes provided on the proxy card.
ELECTION OF TRUSTEES - mark "FOR ALL," "WITHHOLD" or "FOR ALL EXCEPT."
To withhold authority to vote for any one or more individual nominee(s), check
"FOR ALL EXCEPT" and write the nominee's name in the line below.
APPROVAL OF REPLACING THE FUND'S FUNDAMENTAL POLICY REGARDING INVESTMENT IN
SECURITIES OR OBLIGATIONS OF FOREIGN ISSUERS WITH A NON-FUNDAMENTAL POLICY
-- mark "For," "Against" or "Abstain."
Sign, date and return the proxy card in the enclosed postage-paid envelope. All
registered owners of an account, as shown in the address, must sign the card.
When signing as attorney, trustee, executor, administrator, custodian, guardian
or corporate officer, please indicate your full title.
[ ] PLEASE MARK
X VOTES AS IN
THIS EXAMPLE
VAN KAMPEN BOND FUND
ANNUAL MEETING OF SHAREHOLDERS
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
FOR ALL
FOR ALL WITHHOLD EXCEPT
1. Authority to vote [ ] [ ] [ ] 3. To transact such other business as may
for the election as properly come before the Meeting.
Class X Trustees
the nominees named
below:
XXXXXXXXX, XXXXXXXXX, XXXXXXXXX
To withhold authority to vote for any one or more
individual nominee check "For All Except" and write
the
nominee's name on the line below.
----------------------------------
2. Authority to replace the Fund's fundamental policy FOR AGAINST ABSTAIN
regarding the Fund's ability to invest in securities [ ] [ ] [ ]
or obligations of foreign issuers with a
non-fundamental policy.
Please be sure to sign and date this Proxy, Date
Shareholder sign here Co-owner sign here
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
SAMPLE
VAN KAMPEN BOND FUND
1221 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10020
(800) 341-2929
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 22, 2007
Notice is hereby given to the holders of common shares of beneficial interest
("Common Shares") of the Van Kampen Bond Fund (the "Fund") that an Annual
Meeting of Shareholders of the Fund (the "Meeting") will be held at the offices
of Van Kampen Investments Inc., 1 Parkview Plaza, Oakbrook Terrace, Illinois
60181-5555, on Friday, June 22, 2007 at 10:00 a.m., for the following purposes:
1. To elect three Class III trustees by the holders of Common
Shares of the Fund. The elected Class III trustees will each
serve for a three year term or until a successor shall have
been duly elected and qualified.
2. To approve replacing the Fund's fundamental policy regarding
investment in securities or obligations of foreign issuers
with a non-fundamental policy.
3. To transact such other business as may properly come before
the Meeting or any adjournments thereof.
Holders of record of the Common Shares of the Fund at the close of business on
April 27, 2007 are entitled to notice of and to vote at the Meeting and any
adjournment thereof.
By order of the Board of Trustees
STEFANIE V. CHANG,
Vice President
May 1, 2007
THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL REPORT
AND SEMI-ANNUAL REPORT TO ANY SHAREHOLDER UPON REQUEST. ANY SUCH REQUEST SHOULD
BE DIRECTED TO THE FUND BY CALLING 1-800-341-2929 OR BY WRITING TO THE FUND AT 1
PARKVIEW PLAZA, PO BOX 5555, OAKBROOK TERRACE, ILLINOIS 60181-5555.
SHAREHOLDERS OF THE FUND ARE INVITED TO ATTEND THE MEETING IN PERSON. IF YOU
DO NOT EXPECT TO ATTEND THE MEETING, PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON
THE ENCLOSED PROXY CARD, DATE AND SIGN SUCH PROXY CARD, AND RETURN IT IN THE
ENVELOPE PROVIDED, WHICH IS ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE
IF MAILED
IN THE UNITED STATES. YOU MAY ALSO RECORD YOUR VOTING INSTRUCTIONS BY TELEPHONE
OR VIA THE INTERNET.
IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK THAT
YOU MAIL YOUR PROXY PROMPTLY OR RECORD YOUR VOTING INSTRUCTIONS BY TELEPHONE OR
VIA THE INTERNET.
The Board of Trustees of the Fund recommends that you cast your vote:
- FOR ALL of the nominees for the Board of Trustees listed in the Proxy
Statement.
- FOR approval of replacing the Fund's fundamental policy regarding investment
in securities or obligations of foreign issuers with a non-fundamental
policy.
YOUR VOTE IS IMPORTANT.
PLEASE RETURN YOUR PROXY CARD PROMPTLY
NO MATTER HOW MANY SHARES YOU OWN.
PROXY STATEMENT
VAN KAMPEN BOND FUND
1221 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10020
(800) 341-2929
ANNUAL MEETING OF SHAREHOLDERS
JUNE 22, 2007
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INTRODUCTION
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This Proxy Statement is furnished in connection with the solicitation by the
Board of Trustees (the "Trustees" or the "Board") of the Van Kampen Bond Fund
(the "Fund") of proxies to be voted at the Annual Meeting of Shareholders of the
Fund, and all adjournments thereof (the "Meeting"), to be held at the offices of
Van Kampen Investments Inc., 1 Parkview Plaza, Oakbrook Terrace, Illinois
60181-5555, on Friday, June 22, 2007, at 10:00 a.m. The approximate mailing date
of this Proxy Statement and accompanying form of proxy is May 7, 2007.
The purposes of the Meeting are:
1. To elect three Class III trustees by the holders of common shares of
beneficial interest (the "Common Shares") of the Fund. The elected Class III
trustees will each serve for a three year term or until a successor shall have
been duly elected and qualified.
2. To approve replacing the Fund's fundamental policy regarding investment in
securities or obligations of foreign issuers with a non-fundamental policy.
3. To transact such other business as may properly come before the Meeting or
any adjournments thereof.
Participating in the Meeting are holders of Common Shares of the Fund. The
Board has fixed the close of business on April 27, 2007 as the record date (the
"Record Date") for the determination of holders of Common Shares of the Fund
entitled to vote at the Meeting. At the close of business on April 27, 2007,
there were issued and outstanding 11,335,523 Common Shares of the Fund.
THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL REPORT
AND SEMI-ANNUAL REPORT TO ANY SHAREHOLDER UPON REQUEST. ANY SUCH REQUEST SHOULD
BE DIRECTED TO THE FUND BY CALLING 1-800-341-2929 OR BY WRITING TO THE FUND AT 1
PARKVIEW PLAZA, PO BOX 5555, OAKBROOK TERRACE, ILLINOIS 60181-5555.
VOTING
Holders of Common Shares of the Fund ("Common Shareholders") on the Record
Date are entitled to one vote per Common Share with respect to any proposal
submitted to the Common Shareholders of the Fund, with no Common Share having
cumulative voting rights. The voting requirement for passage of a particular
proposal depends on the nature of the proposal.
With respect to Proposal 1, the affirmative vote of a plurality of the Common
Shares of the Fund present at the Meeting in person or by proxy is required to
elect each nominee for Trustee of the Fund. Election by plurality means those
persons who receive the highest number of votes cast "FOR" up to the total
number of persons to be elected as Trustees at the Meeting shall be elected.
With respect to Proposal 2, the affirmative vote of a majority of the Fund's
Common Shares (defined as the lesser of (i) 67% or more of the voting securities
present at the Meeting of shareholders, if holders of more than 50% of the
outstanding voting securities are present at the Meeting, or (ii) more than 50%
of the outstanding voting securities).
THE BOARD OF TRUSTEES OF THE FUND RECOMMENDS THAT YOU CAST YOUR VOTE FOR ALL
OF THE NOMINEES FOR THE BOARD OF TRUSTEES LISTED IN THE PROXY STATEMENT.
All properly executed proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon. Proxies received
prior to the Meeting on which no vote is indicated will be voted "FOR" each
proposal as to which they are entitled to be voted. Abstentions and broker
non-votes (i.e., where a nominee such as a broker, holding shares for beneficial
owners, indicates that instructions have not been received from the beneficial
owners, and the nominee does not exercise discretionary authority) are not
treated as votes "FOR" a proposal. With respect to Proposal 1 (the election of
Trustees), abstentions and broker non-votes are disregarded since only votes
"For" are considered in a plurality voting requirement. With respect to Proposal
2 (replacement of a fundamental policy of the Fund with a non-fundamental
policy), shareholder approval requires approval by a majority of the Fund's
Common Shares (defined as the lesser of (i) 67% or more of the voting securities
present at the Meeting of shareholders, if holders of more than 50% of the
outstanding voting securities are present at such Meeting, or (ii) more than 50%
of the outstanding voting securities); thus abstentions and broker non-votes
will not be treated as votes "For" the proposal and will have the same effect as
votes "Against" the proposal. A majority of the outstanding Common Shares of the
Fund entitled to vote must be present in person or by proxy to have a quorum for
the Fund to conduct business at the Meeting. Abstentions and broker non-votes
will be deemed present for quorum purposes.
2
Common Shareholders who execute proxies may revoke them at any time before
they are voted by filing with the Fund a written notice of revocation, by
delivering a duly executed proxy bearing a later date, by recording later-dated
voting instructions via the internet or automated telephone or by attending the
Meeting and voting in person.
The Fund knows of no business other than the election of Trustees and the
replacement of a fundamental policy of the Fund with a non-fundamental policy
that will be presented for consideration at the Meeting. If any other matters
are properly presented, it is the intention of the persons named on the enclosed
proxy to vote proxies in accordance with their best judgment. In the event a
quorum is present at the Meeting but sufficient votes to approve any of the
proposals are not received, proxies (including abstentions and broker non-votes)
would be voted in favor of one or more adjournments of the Meeting to permit
further solicitation of proxies, provided they determine that such an
adjournment and additional solicitation is reasonable and in the interest of
shareholders based on a consideration of all relevant factors, including the
nature of the relevant proposal, the percentage of votes then cast, the
percentage of negative votes then cast, the nature of the proposed solicitation
activities and the nature of the reasons for such further solicitation.
INVESTMENT ADVISER
The investment adviser for the Fund is Van Kampen Asset Management (the
"Adviser"). The Adviser is a wholly owned subsidiary of Van Kampen Investments
Inc. ("Van Kampen Investments"). Van Kampen Investments is a diversified asset
management company that administers more than three million retail investor
accounts, has extensive capabilities for managing institutional portfolios and
has more than $118 billion under management or supervision as of March 31, 2007.
Van Kampen Investments is an indirect wholly owned subsidiary of Morgan Stanley,
a preeminent global financial services firm that maintains leading market
positions in each of its three primary businesses: securities, asset management
and credit services. Morgan Stanley is a full service securities firm engaged in
securities trading and brokerage activities, investment banking, research and
analysis, financing and financial advisory services. The principal business
address of the Adviser and Van Kampen Investments is 1221 Avenue of the
Americas, New York, New York 10020.
OTHER SERVICE PROVIDERS
The Fund has entered into an accounting services agreement with the Adviser.
The Fund has entered into an employment agreement with John Sullivan and Morgan
Stanley pursuant to which Mr. Sullivan, an employee of Morgan Stanley, serves as
Chief Compliance Officer of the Fund and other Van Kampen funds. The principal
business address of Mr. Sullivan is 1 Parkview Plaza, Oakbrook Terrace, IL
60181. The principal business address of Morgan Stanley is 1221 Avenue of the
Americas, New York, New York 10020.
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3
PROPOSAL 1: ELECTION OF TRUSTEES
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Trustees are to be elected by the shareholders at the Meeting in the following
manner. Three Class III Trustees are to be elected at the Meeting, to serve
until the later of the Fund's Annual Meeting of Shareholders in 2010 or until
their successors have been duly elected and qualified. Holders of Common Shares
will vote with respect to three Class III Trustees (R. Craig Kennedy, Jack E.
Nelson and Hugo F. Sonnenschein) designated to be elected by such class of
shares. An affirmative vote of a plurality of the Common Shares of the Fund is
required to elect the respective nominees. It is the intention of the persons
named in the enclosed proxy to vote the Common Shares represented by them for
the election of the nominees listed unless the proxy is marked otherwise.
As in the past, only one class of Trustees is being submitted to shareholders
of the Fund for election at the Meeting. The Declaration of Trust of the Fund
provides that the Board of Trustees shall consist of Trustees divided into three
classes, the classes to be as nearly equal in number as possible. The Trustees
of only one class are elected at each annual meeting so that the regular term of
only one class of Trustees will expire annually and any particular Trustee
stands for election only once in each three-year period. This type of
classification may prevent replacement of a majority of Trustees of the Fund for
up to a two-year period. The foregoing is subject to the provisions of the
Investment Company Act of 1940, as amended (the "1940 Act"), applicable state
law based on the state of organization of the Fund, the Fund's Declaration of
Trust and the Fund's Bylaws.
4
INFORMATION REGARDING TRUSTEES AND NOMINEES FOR ELECTION AS TRUSTEE
The business and affairs of the Fund are managed under the direction of the
Board of Trustees. The tables below list the incumbent Trustees and nominees for
Trustee, their principal occupations during the last five years, other
directorships held by them and their affiliations, if any, with the Adviser or
its affiliates. The term "Fund Complex" includes each of the investment
companies advised by the Adviser as of the Record Date. Trustees of the Fund
generally serve three year terms or until their successors are duly elected and
qualified. All nominees have consented to being named in this Proxy Statement
and have agreed to serve if elected.
INDEPENDENT TRUSTEES:
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
David C. Arch(1) (61) Trustee Trustee of Chairman and Chief Executive Officer 73
Blistex Inc. the Fund of Blistex Inc., a consumer health
1800 Swift Drive since 1997 care products manufacturer. Director
Oak Brook, IL 60523 of the Heartland Alliance, a
nonprofit organization serving human
needs based in Chicago. Former
Director of St. Vincent de Paul
Center, a Chicago based day care
facility serving the children of low
income families. Board member of the
Illinois Manufacturers' Association.
Jerry D. Choate(1) (68) Trustee Trustee of Prior to January 1999, Chairman and 73
33971 Selva Road the Fund Chief Executive Officer of the
Suite 130 since 2003 Allstate Corporation ("Allstate") and
Dana Point, CA 92629 Allstate Insurance Company. Prior to
January 1995, President and Chief
Executive Officer of Allstate. Prior
to August 1994, various management
positions at Allstate.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
David C. Arch(1) (61) Trustee/Director/Managing
Blistex Inc. General Partner of funds in
1800 Swift Drive the Fund Complex.
Oak Brook, IL 60523
Jerry D. Choate(1) (68) Trustee/Director/Managing
33971 Selva Road General Partner of funds in
Suite 130 the Fund Complex. Director
Dana Point, CA 92629 of H&R Block, Director of
Amgen Inc., a
biotechnological company,
and Director of Valero
Energy Corporation, an
independent refining
company.
5
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
Rod Dammeyer(2) (66) Trustee Trustee of President of CAC, L.L.C., a private 73
CAC, L.L.C. the Fund company offering capital investment
4350 LaJolla Village Drive since 1997 and management advisory services.
Suite 980 Prior to February 2001, Vice Chairman
San Diego, CA 92122-6223 and Director of Anixter
International, Inc., a global
distributor of wire, cable and
communications connectivity products.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
Rod Dammeyer(2) (66) Trustee/Director/Managing
CAC, L.L.C. General Partner of funds in
4350 LaJolla Village Drive the Fund Complex. Director
Suite 980 of Quidel Corporation,
San Diego, CA 92122-6223 Stericycle, Inc., Ventana
Medical Systems, Inc., and
GATX Corporation, and
Trustee of The Scripps
Research Institute. Prior to
January 2005, Trustee of the
University of Chicago
Hospitals and Health
Systems. Prior to April
2004, Director of
TheraSense, Inc. Prior to
January 2004, Director of
TeleTech Holdings Inc. and
Arris Group, Inc. Prior to
May 2002, Director of
Peregrine Systems Inc. Prior
to February 2001, Director
of IMC Global Inc.
6
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
Linda Hutton Heagy+(2) (58) Trustee Trustee of Managing Partner of Heidrick & 73
Heidrick & Struggles the Fund Struggles, an international executive
233 South Wacker Drive since 2003 search firm. Trustee on the
Suite 7000 University of Chicago Hospitals
Chicago, IL 60606 Board, Vice Chair of the Board of the
YMCA of Metropolitan Chicago and a
member of the Women's Board of the
University of Chicago. Prior to 1997,
Partner of Ray & Berndtson, Inc., an
executive recruiting firm. Prior to
1996, Trustee of The International
House Board, a fellowship and housing
organization for international
graduate students. Prior to 1995,
Executive Vice President of ABN AMRO,
N.A., a bank holding company. Prior
to 1990, Executive Vice President of
The Exchange National Bank.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
Linda Hutton Heagy+(2) (58) Trustee/Director/Managing
Heidrick & Struggles General Partner of funds in
233 South Wacker Drive the Fund Complex.
Suite 7000
Chicago, IL 60606
7
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
R. Craig Kennedy(3) (55) Trustee Trustee of Director and President of the German 73
1744 R Street, N.W. the Fund Marshall Fund of the United States,
Washington, D.C. 20009 since 2003 an independent U.S. foundation
created to deepen understanding,
promote collaboration and stimulate
exchanges of practical experience
between Americans and Europeans.
Formerly, advisor to the Dennis
Trading Group Inc., a managed futures
and option company that invests money
for individuals and institutions.
Prior to 1992, President and Chief
Executive Officer, Director and
member of the Investment Committee of
the Joyce Foundation, a private
foundation.
Howard J Kerr(1) (71) Trustee Trustee of Prior to 1998, President and Chief 73
14 Huron Trace the Fund Executive Officer of Pocklington
Galena, IL 61036 since 1997 Corporation, Inc., an investment
holding company. Director of the
Marrow Foundation.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
R. Craig Kennedy(3) (55) Trustee/Director/Managing
1744 R Street, N.W. General Partner of funds in
Washington, D.C. 20009 the Fund Complex.
Howard J Kerr(1) (71) Trustee/Director/Managing
14 Huron Trace General Partner of funds in
Galena, IL 61036 the Fund Complex. Director
of the Lake Forest Bank &
Trust.
8
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
Jack E. Nelson(3) (71) Trustee Trustee of President of Nelson Investment 73
423 Country Club Drive the Fund Planning Services, Inc., a financial
Winter Park, FL 32789 since 2003 planning company and registered
investment adviser in the State of
Florida. President of Nelson Ivest
Brokerage Services Inc., a member of
the NASD, Securities Investors
Protection Corp. and the Municipal
Securities Rulemaking Board.
President of Nelson Sales and
Services Corporation, a marketing and
services company to support
affiliated companies.
Hugo F. Sonnenschein(3) (66) Trustee Trustee of President Emeritus and Honorary 73
1126 E. 59th Street the Fund Trustee of the University of Chicago
Chicago, IL 60637 since 1997 and the Adam Smith Distinguished
Service Professor in the Department
of Economics at the University of
Chicago. Prior to July 2000,
President of the University of
Chicago. Trustee of the University of
Rochester and a member of its
investment committee. Member of the
National Academy of Sciences, the
American Philosophical Society and a
fellow of the American Academy of
Arts and Sciences. Prior to 2006,
Director of Winston Laboratories,
Inc.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
Jack E. Nelson(3) (71) Trustee/Director/Managing
423 Country Club Drive General Partner of funds in
Winter Park, FL 32789 the Fund Complex.
Hugo F. Sonnenschein(3) (66) Trustee/Director/Managing
1126 E. 59th Street General Partner of funds in
Chicago, IL 60637 the Fund Complex.
9
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
Suzanne H. Woolsey, Ph.D.(1) Trustee Trustee of Chief Communications Officer of the 73
(65) the Fund National Academy of Sciences/National
815 Cumberstone Road since 2003 Research Council, an independent,
Harwood, MD 20776 federally chartered policy
institution, from 2001 to November
2003 and Chief Operating Officer from
1993 to 2001. Director of the
Institute for Defense Analyses, a
federally funded research and
development center, Director of the
German Marshall Fund of the United
States, Director of the Rocky
Mountain Institute and Trustee of
California Institute of Technology
and Colorado College. Prior to 1993,
Executive Director of the Commission
on Behavioral and Social Sciences and
Education at the National Academy of
Sciences/National Research Council.
From 1980 through 1989, Partner of
Coopers & Lybrand. Director of
Neurogen Corporation, a
pharmaceutical company, from January
1998 until June 2006.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
Suzanne H. Woolsey, Ph.D.(1) Trustee/Director/Managing
(65) General Partner of funds in
815 Cumberstone Road the Fund Complex. Director
Harwood, MD 20776 of Fluor Corp., an
engineering, procurement and
construction organization,
since January 2004. Director
of Intelligent Medical
Devices, a company that
develops symptom-based
diagnostic tools for
physicians and clinical
labs.
10
INTERESTED TRUSTEE:
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN
OF TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE
Wayne W. Whalen*(2) (67) Trustee Trustee of Partner in the law firm of Skadden, Arps, Slate, Meagher & 73
333 West Wacker Drive the Fund Flom LLP, legal counsel to certain funds in the Fund
Chicago, IL 60606 since 1997 Complex.
NAME, AGE AND ADDRESS OTHER DIRECTORSHIPS
OF TRUSTEE HELD BY TRUSTEE
Wayne W. Whalen*(2) (67) Trustee/Director/
333 West Wacker Drive Managing General
Chicago, IL 60606 Partner of funds in
the Fund Complex.
Director of the
Abraham Lincoln
Presidential Library
Foundation.
---------------
(1) Designated as a Class I trustee.
(2) Designated as a Class II trustee.
(3) Designated as a Class III trustee.
+ As indicated above, Ms. Heagy is an employee of Heidrick and Struggles, an
international executive search firm ("Heidrick"). Heidrick has been (and may
continue to be) engaged by Morgan Stanley from time to time to perform
executive searches. Such searches have been unrelated to Van Kampen's or
Morgan Stanley's asset management businesses and have been done by
professionals at Heidrick without any involvement by Ms. Heagy. Ethical wall
procedures exist to ensure that Ms. Heagy will not have any involvement with
any searches performed by Heidrick for Morgan Stanley. Ms. Heagy does not
receive any compensation, directly or indirectly, for searches performed by
Heidrick for Morgan Stanley. Ms. Heagy does own common shares of Heidrick
(representing less than 1% of Heidrick's outstanding common shares).
* Mr. Whalen is an interested person of funds in the Fund Complex by reason of
he and his firm currently providing legal services as legal counsel to such
funds in the Fund Complex.
11
REMUNERATION OF TRUSTEES
The compensation of Trustees and executive officers that are affiliated
persons (as defined in 1940 Act) of the Adviser or Van Kampen Investments is
paid by the respective affiliated entity. The funds in the Fund Complex,
including the Fund, pay the non-affiliated Trustees an annual retainer and
meeting fees for services to funds in the Fund Complex.
Each fund in the Fund Complex (except the Van Kampen Exchange Fund) provides a
deferred compensation plan to its non-affiliated Trustees that allows such
Trustees to defer receipt of compensation and earn a return on such deferred
amounts based upon the return of the common shares of the funds in the Fund
Complex as selected by the respective non-affiliated Trustees. Each fund in the
Fund Complex (except the Van Kampen Exchange Fund) also provides a retirement
plan to its non-affiliated Trustees that provides non-affiliated Trustees with
compensation after retirement, provided that certain eligibility requirements
are met as more fully described below.
Each non-affiliated Trustee generally can elect to defer receipt of all or a
portion of the compensation earned by such non-affiliated Trustee until
retirement. Amounts deferred are retained by the respective fund and earn a rate
of return determined by reference to the return on the common shares of such
fund or other funds in the Fund Complex as selected by the respective
non-affiliated Trustee, with the same economic effect as if such non-affiliated
Trustee had invested in one or more funds in the Fund Complex, including the
Fund. To the extent permitted by the 1940 Act, the Fund may invest in securities
of those funds selected by the non-affiliated Trustees in order to match the
deferred compensation obligation. The deferred compensation plan is not funded
and obligations thereunder represent general unsecured claims against the
general assets of the Fund.
The Fund has adopted a retirement plan. Under the retirement plan, a
non-affiliated Trustee who is receiving Trustee's compensation from the Fund
prior to such non-affiliated Trustee's retirement, has at least 10 years of
service (including years of service prior to adoption of the retirement plan)
for the Fund and retires at or after attaining the age of 60, is eligible to
receive a retirement benefit each year for ten years following such Trustee's
retirement from the Fund. Non-affiliated Trustees retiring prior to the age of
60 or with fewer than 10 years but more than 5 years of service may receive
reduced retirement benefits from the Fund. Each Trustee has served as a member
of the Fund's Board of Trustees since the year of such Trustee's appointment or
election as set forth in the "Information Regarding Trustees and Nominees for
Election as Trustee" section of this Proxy Statement.
12
Additional information regarding compensation and benefits for Trustees is set
forth below. As indicated in the notes accompanying the table, the amounts
relate to either the Fund's most recently completed fiscal year ended June 30,
2006, the Fund Complex's most recently completed calendar year ended December
31, 2006 or the date of this Proxy Statement.
Additional information regarding compensation and benefits for trustees of the
Fund is set forth below for the periods described in the notes accompanying the
table.
COMPENSATION TABLE
Fund Complex
-----------------------------------------------------
Aggregate Aggregate
Pension or Estimated Total
Retirement Maximum Annual Compensation
Aggregate Benefits Benefits from the before Deferral
Compensation Accrued as Part Fund Complex from Fund
from the of Expenses Upon Retirement Complex
Name Fund(1) (2) (3) (4)
---- ------------ --------------- ----------------- ---------------
INDEPENDENT TRUSTEES
David C. Arch $3,174 $ 35,373 $105,000 $259,418
Jerry D. Choate 3,764 80,600 105,000 254,394
Rod Dammeyer 3,174 64,051 105,000 259,418
Linda Hutton Heagy 3,764 25,769 105,000 254,394
R. Craig Kennedy 3,764 18,372 105,000 254,394
Howard J Kerr 3,174 140,735 143,750 259,418
Jack E. Nelson 3,477 92,953 105,000 238,523
Hugo F. Sonnenschein 3,174 64,671 105,000 259,418
Suzanne H. Woolsey 3,764 57,060 105,000 254,394
INTERESTED TRUSTEE
Wayne W. Whalen 3,174 67,997 105,000 259,418
(1) The amounts shown in this column represent the aggregate compensation before
deferral with respect to the Fund's fiscal year ended June 30, 2006. The
following trustees deferred compensation from the Fund during the fiscal
year ended June 30, 2006: Mr. Choate, $3,764; Mr. Dammeyer, $3,174; Ms.
Heagy, $3,764; Mr. Nelson, $3,477; Mr. Sonnenschein, $3,174; and Mr. Whalen,
$3,174. The cumulative deferred compensation (including interest) accrued
with respect to each trustee, including former trustees, from the Fund as of
Fund's fiscal year ended June 30, 2006 is as follows: Mr. Choate, $11,717;
Mr. Dammeyer, $26,892; Ms. Heagy, $11,731; Mr. Kennedy, $1,455; Mr. Kerr,
$3,036; Mr. Nelson, $11,815; Mr. Sonnenschein, $30,411; and Mr. Whalen,
$32,701. The deferred compensation plan is described above the Compensation
Table.
13
(2) The amounts shown in this column represent the sum of the retirement
benefits accrued by the operating funds in the Fund Complex for each of the
trustees for the funds' respective fiscal years ended in 2006. The
retirement plan is described above the Compensation Table.
(3) For each trustee, this is the sum of the estimated maximum annual benefits
payable by the funds in the Fund Complex as of the date of this Proxy
Statement for each year of the 10-year period commencing in the year of such
trustee's anticipated retirement. The retirement plan is described above the
Compensation Table.
(4) The amounts shown in this column represent the aggregate compensation paid
by all of the funds in the Fund Complex as of December 31, 2006 before
deferral by the trustees under the deferred compensation plan. Because the
funds in the Fund Complex have different fiscal year ends, the amounts shown
in this column are presented on a calendar year basis.
BOARD COMMITTEES AND MEETINGS
The Fund's Board of Trustees has three standing committees (an audit
committee, a brokerage and services committee and a governance committee). Each
committee is comprised solely of "Independent Trustees", which is defined for
purposes herein as trustees who: (1) are not "interested persons" of the Fund as
defined by the 1940 Act and (2) are "independent" of the Fund as defined by the
New York Stock Exchange, American Stock Exchange and Chicago Stock Exchange
listing standards.
The Board's audit committee consists of Messrs. Choate, Dammeyer and Kennedy.
In addition to being Independent Trustees as defined above, each of these
Trustees also meets the additional independence requirements for audit committee
members as defined by the New York Stock Exchange, American Stock Exchange and
Chicago Stock Exchange listing standards. The audit committee makes
recommendations to the Board of Trustees concerning the selection of the Fund's
independent registered public accounting firm, reviews with such independent
registered public accounting firm the scope and results of the Fund's annual
audit and considers any comments which the independent registered public
accounting firm may have regarding the Fund's financial statements, accounting
records or internal controls. The Board of Trustees has adopted a formal written
charter for the audit committee which sets forth the audit committee's
responsibilities. The audit committee charter for the Fund is available on Van
Kampen's website at www.vankampen.com. The audit committee has reviewed and
discussed the financial statements of the Fund with management as well as with
the independent registered public accounting firm of the Fund, and discussed
with the independent registered public accounting firm the matters required to
be discussed under the Statement of Auditing Standards No. 61. The audit
committee has received the written disclosures and the letter from the
independent registered public accounting
14
firm required under Independence Standard Board Standard No. 1 and has discussed
with the independent auditors their independence. Based on this review, the
audit committee recommended to the Board of Trustees of the Fund that the Fund's
audited financial statements be included in the Fund's annual report to
shareholders for the most recent fiscal year for filing with the Securities and
Exchange Commission ("SEC"). Each member of the Fund's audit committee is deemed
an audit committee financial expert.
The Board's brokerage and services committee consists of Mesdames Heagy and
Woolsey and Mr. Sonnenschein. The brokerage and services committee reviews the
Fund's allocation of brokerage transactions and soft-dollar practices and
reviews the transfer agency and shareholder servicing arrangements.
The Board's governance committee consists of Messrs. Arch, Kerr and Nelson. In
addition to being Independent Trustees as defined above, each of these Trustees
also meets the additional independence requirements for nominating committee
members as defined by the New York Stock Exchange, American Stock Exchange and
Chicago Stock Exchange listing standards. The governance committee identifies
individuals qualified to serve as Independent Trustees on the Board and on
committees of the Board, advises the Board with respect to Board composition,
procedures and committees, develops and recommends to the Board a set of
corporate governance principles applicable to the Fund, monitors corporate
governance matters and makes recommendations to the Board, and acts as the
administrative committee with respect to Board policies and procedures,
committee policies and procedures and codes of ethics. The governance committee
charter for the Fund, which includes the Fund's nominating policies, is
available on Van Kampen's website at www.vankampen.com. The Independent Trustees
of the Fund select and nominate any other nominee Independent Trustees for the
Fund. While the Independent Trustees of the Fund expect to be able to continue
to identify from their own resources an ample number of qualified candidates for
the Board of Trustees as they deem appropriate, they will consider nominations
from shareholders to the Board. Nominations from shareholders should be in
writing and sent to the Independent Trustees as described below.
During the fiscal year ended June 30, 2006, the Board of Trustees of the Fund
held ten meetings. During the Fund's last fiscal year, the audit committee of
the Fund held four meetings, the brokerage and services committee of the Board
of the Fund held four meetings and the governance committee of the Board held
two meetings. During the last fiscal year, each of the Trustees of the Fund
during the period such Trustee served as a Trustee attended at least 75% of the
meetings of the Fund's Board of Trustees and all committee meetings thereof of
which such Trustee was a member.
15
SHAREHOLDER COMMUNICATIONS
Shareholders may send communications to the Fund's Board of Trustees.
Shareholders should send communications intended for the Board by addressing the
communication directly to the Board (or individual Board members) and/or
otherwise clearly indicating in the salutation that the communication is for the
Board (or individual Board members) and by sending the communication to either
the Fund's office or directly to such Board member(s) at the address specified
for such Trustee above. Other shareholder communications received by the Fund
not directly addressed and sent to the Board will be reviewed and generally
responded to by management, and will be forwarded to the Board only at
management's discretion based on the matters contained therein.
SHAREHOLDER APPROVAL
With respect to Proposal 1, the affirmative vote of a plurality of the Common
Shares of the Fund present at the Meeting in person or by proxy is required to
elect each nominee for Trustee of the Fund. Election by plurality means those
persons who receive the highest number of votes cast "FOR" up to the total
number of persons to be elected as Trustees at the Meeting shall be elected.
There is no cumulative voting with respect to the election of Trustees.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR ALL" OF THE NOMINEES.
------------------------------------------------------------------------------
PROPOSAL 2: REPLACE A FUNDAMENTAL POLICY OF THE FUND WITH A NON-FUNDAMENTAL
POLICY
------------------------------------------------------------------------------
The Fund's investment objective is to seek interest income while conserving
capital. The Fund seeks to achieve this objective through investing in a
diversified portfolio consisting primarily of high-quality debt securities
rated, at the time of purchase by the Fund, in one of the four highest rating
categories by certain nationally recognized rating agencies. It is the Fund's
policy, which may not be changed without shareholder approval, to have at least
80% of its total assets invested in (i) debt securities rated, at the time of
purchase by the Fund, in one of the four highest categories by Moody's Investors
Service, Inc. ("Moody's"), Standard & Poor's Corporation ("S&P") or Fitch
Investors Service, Inc. ("Fitch"); (ii) securities of, or guaranteed by, the
U.S. Government or any agency of the U.S. Government; (iii) commercial paper
rated "prime"; or (iv) cash and cash equivalents. Some of the Fund's investments
that comprise this 80% basket may be securities of foreign issuers. The Fund is
not proposing any changes to the investment objective or primary investment
strategy as set forth in the preceding sentences.
16
The Fund also operates under other policies, some of which are operating
policies that may be changed by the Fund's Board of Trustees without shareholder
approval and some of which are "fundamental" policies that may only be changed
with shareholder approval. The Fund seeks to eliminate a fundamental policy and
replace it with a non-fundamental policy to allow the Fund to invest up to 20%
of the Fund's total assets in both U.S. dollar denominated and non-U.S. dollar
denominated securities of foreign issuers. Changes in fundamental policies
require the approval of the holders of a majority of the Fund's outstanding
Common Shares (defined as the lesser of (i) 67% or more of the voting securities
present at a meeting of shareholders, if the holders of more than 50% of the
outstanding voting securities are present or represented by proxy at such
meeting, or (ii) more than 50% of the outstanding voting securities).
OVERVIEW
The Fund seeks to invest up to 20% of the Fund's total assets in both U.S.
dollar denominated and non-U.S. dollar denominated securities of foreign issuers
to benefit the Fund's shareholders. The Adviser believes that the ability to
invest in securities of foreign issuers (denominated in both U.S. dollars and
non-U.S. dollars), which may include issuers from emerging market countries,
will allow the Fund to better achieve its investment objective. Under the Fund's
current policy, the Fund is currently authorized to invest in an amount not to
exceed 10% of the total assets of the Fund at the time of purchase, in
securities of foreign issuers so long as the principal and interest on such
securities are payable in U.S. currency and such securities are rated by a U.S.
rating agency as A or better. The Fund seeks to replace this policy with a
non-fundamental policy that allows the Fund to invest up to 20% of the Fund's
net assets in both U.S. dollar denominated and non-U.S. dollar denominated
securities of foreign issuers. In addition, it is proposed that the more
restrictive quality limitation for foreign investments be eliminated. As
mentioned above, the Fund is not changing its primary investment strategy (of
investing primarily in high-quality debt securities); thus, applying the
proposed change, the Fund will continue to invest at least 80% of its total
assets (domestic or foreign) in the categories described above. If approved, the
Adviser may also engage in foreign currency hedges and cross hedges as described
below.
The remainder of this section provides: (1) the details on the Fund's current
fundamental policy regarding investment in securities of foreign issuers and the
new proposed non-fundamental policy; (2) a summary of the recommendation for
this proposal and the Board's conclusion that the proposal is in the best
interests of the Fund's Common Shareholders; and (3) a discussion of the risks
of investing in securities of foreign issuers.
17
THE FUND'S POLICY REGARDING INVESTING IN SECURITIES FOREIGN ISSUERS -- CURRENT
AND PROPOSED
The Fund currently has a fundamental policy that provides that the Fund:
may invest in an amount not to exceed 10% of the total assets of the
Fund at the time of purchase, in securities or obligations of foreign
issuers so long as the principal and interest on such securities are
payable in U.S. currency and such securities are rated by a U.S. rating
agency as A or better.
The Board of Trustees proposes replacing the above described fundamental
policy with a non-fundamental policy that allows the Fund to invest up to 20% of
the Fund's total assets in both U.S. dollar denominated and non-U.S. dollar
denominated securities of foreign issuers. Since the Adviser proposes to invest
in securities of foreign issuers that are denominated in non-U.S. dollars, if
approved, the Fund may use forward contracts to hedge the currency risk
associated with such investments back to the U.S. dollar. In addition to such
direct hedging using forward contracts, the Fund may also enter into "cross
hedges."
The Adviser believes that the ability to invest in securities of foreign
issuers (denominated in both U.S. dollars and non-U.S. dollars), which may
include securities of emerging market issuers, will allow the Fund to better
achieve its investment objective.
ACTION AND RECOMMENDATION OF THE BOARD OF TRUSTEES
Representatives of the Adviser made presentations to the Fund's Board of
Trustees proposing the replacement of the Fund's fundamental policy regarding
the ability to invest in securities of foreign issuers with a non-fundamental
policy. The Adviser believes the increased ability of the Fund to invest in
securities issued by foreign issuers will allow the Fund to better achieve its
investment objective with limited additional risks. The Adviser noted that the
Fund's competitors in its peer group invest, or are permitted to invest, in
securities of foreign issuers to a greater extent than the Fund's current
fundamental investment restriction allows. The Board of Trustees considered
information prepared by the Adviser regarding potential benefits, costs and
risks of replacing the fundamental policy with the non-fundamental policy,
including the greater flexibility and potential cost savings associated with a
non-fundamental policy that can be amended by the Fund's Board of Trustees as
opposed to a fundamental policy that requires a shareholder vote to amend. Among
the potential benefits discussed were (i) allowing the Fund to better achieve
its investment objective, (ii) the ability for the Fund to expand its portfolio
while maintaining its principal investment strategy and (iii) the ability to
invest to a greater extent in a type of issuer in which the Fund's competitors
in its peer groups
18
invest. The Adviser and the Board of Trustees discussed the Fund's current
fundamental investment restriction on investing in securities of foreign
issuers.
After careful consideration, the Board of Trustees determined that the
approval of this proposal and the ability of the Fund to invest up to 20% of its
total assets in securities of foreign issuers (both U.S. dollar denominated and
non-U.S. dollar denominated) are in the best interests of the Fund's Common
Shareholders.
RISKS OF INVESTING IN SECURITIES OF FOREIGN ISSUERS
This section describes the risks of investing in securities of foreign
issuers. Note that the Fund already is subject to many of these risks as the
Fund may already invest up to 10% of its assets in U.S. dollar-denominated
securities of foreign issuers subject to certain credit quality constraints. The
proposal sought is to, among other things, (i) increase the percentage of
securities of foreign issuers permitted to 20% (which may include issuers from
emerging market countries), (ii) allow both U.S. dollar-denominated and non-U.S.
dollar-denominated securities, (iii) eliminate the Fund's currently more
restrictive credit quality limitation on issuers of foreign securities (this
does not change the Fund's overall strategy of investing primarily in
high-quality debt securities) and (iv) if approved, the Adviser may also engage
in certain foreign currency derivatives transactions.
Securities of foreign issuers may be denominated in U.S. dollars or in
currencies other than U.S. dollars. Investments in securities of foreign issuers
present certain risks not ordinarily associated with investments in securities
of U.S. issuers. These risks include fluctuations in foreign currency exchange
rates, political, economic or legal developments (including war or other
instability, expropriation of assets, nationalization and confiscatory
taxation), the imposition of foreign exchange limitations (including currency
blockage), withholding taxes on income or capital transactions or other
restrictions, higher transaction costs (including higher brokerage, custodial
and settlement costs and currency conversion costs) and possible difficulty in
enforcing contractual obligations or taking judicial action. Securities of
foreign issuers may not be as liquid and may be more volatile than comparable
securities of domestic issuers.
In addition, there often is less publicly available information about many
foreign issuers, and issuers of foreign securities are subject to different,
often less comprehensive, auditing, accounting and financial reporting
disclosure requirements than domestic issuers. There is generally less
government regulation of exchanges, brokers and listed companies abroad than in
the United States and, with respect to certain foreign countries, there is a
possibility of expropriation or confiscatory taxation, or diplomatic
developments which could affect investment in those countries. Because there is
usually less supervision and governmental regulation of foreign exchanges,
brokers and dealers than there is in the United States, the Fund
19
may experience settlement difficulties or delays not usually encountered in the
United States.
Delays in making trades in securities of foreign issuers relating to volume
constraints, limitations or restrictions, clearance or settlement procedures, or
otherwise could impact yields and result in temporary periods when assets of the
Fund are not fully invested or attractive investment opportunities are foregone.
The Fund may invest in securities of issuers determined by the investment
adviser to be in developing or emerging market countries. Investments in
securities of issuers in developing or emerging market countries are subject to
greater risks than investments in securities of developed countries since
emerging market countries tend to have economic structures that are less diverse
and mature and political systems that are less stable than developed countries.
In addition to the increased risks of investing in securities of foreign
issuers, there are often increased transaction costs associated with investing
in securities of foreign issuers, including the costs incurred in connection
with converting currencies, higher foreign brokerage or dealer costs and higher
settlement costs or custodial costs.
The Fund may invest in securities of foreign issuers in the form of depositary
receipts. Depositary receipts involve substantially identical risks to those
associated with direct investment in securities of foreign issuers. In addition,
the underlying issuers of certain depositary receipts, particularly unsponsored
or unregistered depositary receipts, are under no obligation to distribute
shareholder communications to the holders of such receipts, or to pass through
to them any voting rights with respect to the deposited securities.
Since the Fund may invest in securities denominated or quoted in currencies
other than the U.S. dollar, the Fund may be affected by changes in foreign
currency exchange rates (and exchange control regulations) which affect the
value of investments in the Fund and the accrued income and appreciation or
depreciation of the investments. Changes in foreign currency exchange rates
relative to the U.S. dollar will affect the U.S. dollar value of the Fund's
assets denominated in that currency and the Fund's return on such assets as well
as any temporary uninvested reserves in bank deposits in foreign currencies. In
addition, the Fund will incur costs in connection with conversions between
various currencies.
The Fund may purchase and sell foreign currency on a spot (i.e., cash) basis
in connection with the settlement of transactions in securities traded in such
foreign currency. The Fund also may enter into contracts with banks, brokers or
dealers to purchase or sell securities or foreign currencies at a future date
("forward contracts"). A foreign currency forward contract is a negotiated
agreement between the contracting parties to exchange a specified amount of
currency at a specified future time at a specified rate. The rate can be higher
or lower than the spot rate between the currencies that are the subject of the
contract.
20
The Fund may attempt to protect against adverse changes in the value of the
U.S. dollar in relation to a foreign currency by entering into a forward
contract for the purchase or sale of the amount of foreign currency invested or
to be invested, or by buying or selling a foreign currency option or futures
contract for such amount. Such strategies may be employed before the Fund
purchases a foreign security traded in the currency which the Fund anticipates
acquiring or between the date the foreign security is purchased or sold and the
date on which payment therefor is made or received. Seeking to protect against a
change in the value of a foreign currency in the foregoing manner does not
eliminate fluctuations in the prices of portfolio securities or prevent losses
if the prices of such securities decline. Furthermore, such transactions reduce
or preclude the opportunity for gain if the value of the currency should move in
the direction opposite to the position taken. Unanticipated changes in currency
prices may result in poorer overall performance for the Fund than if it had not
entered into such contracts. The Fund may also cross-hedge currencies by
entering into a transaction to purchase or sell one or more currencies that are
expected to change in value relative to other currencies to which it has or
expects to have exposure. The Fund's entry into forward contracts, options,
futures or other derivatives will generally require the Fund to segregate cash
and/or liquid securities at least equal to the Fund's obligations throughout the
duration of the contract.
The use of currency transactions can result in the Fund incurring losses
because of the imposition of exchange controls, suspension of settlements or the
inability of the Fund to deliver or receive a specified currency. In addition,
amounts paid as premiums and cash or other assets held in margin accounts with
respect to such transactions are not otherwise available to the Fund for
investment purposes.
When conducted outside the United States, such transactions may not be
regulated as rigorously as in the United States, may not involve a clearing
mechanism and related guarantees, and are subject to the risk of governmental
actions affecting trading in, or the prices of, foreign securities, currencies
and other instruments. The value of such positions also could be adversely
affected by: (i) other complex foreign political, legal and economic factors,
(ii) lesser availability than in the United States of data on which to make
trading decisions, (iii) delays in the Fund's ability to act upon economic
events occurring in foreign markets during non-business hours in the United
States, (iv) the imposition of different exercise and settlement terms and
procedures and margin requirements than in the United States and (v) lower
trading volume and liquidity.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE PROPOSAL TO
REPLACE THE FUNDAMENTAL POLICY REGARDING THE FUND'S ABILITY TO INVEST IN
SECURITIES OF FOREIGN ISSUERS WITH A NON-FUNDAMENTAL POLICY.
21
--------------------------------------------------------------------------------
OTHER INFORMATION
--------------------------------------------------------------------------------
EXECUTIVE OFFICERS OF THE FUND
The following information relates to the executive officers of the Fund. Each
officer also serves in the same capacity for all or a number of the other
investment companies advised by the Adviser or affiliates of the Adviser. The
officers of the Fund are appointed annually by the Trustees and serve for one
year or until their respective successors are chosen and qualified. The Fund's
officers receive no compensation from the Fund but may also be officers of the
Adviser or officers of affiliates of the Adviser and receive compensation in
such capacities.
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER FUND SERVED DURING PAST 5 YEARS
Ronald E. Robison (68) President and Officer President of funds in the Fund Complex since September 2005
1221 Avenue of the Americas Principal since 2003 and Principal Executive Officer of funds in the Fund Complex
New York, NY 10020 Executive Officer since May 2003. Managing Director of Van Kampen Advisors
Inc. since June 2003. Director of Investor Services since
September 2002. Director of the Adviser, Van Kampen
Investments and Van Kampen Exchange Corp. since January
2005. Managing Director of Morgan Stanley and Morgan Stanley
& Co. Incorporated. Managing Director and Director of Morgan
Stanley Investment Management Inc. Chief Administrative
Officer, Managing Director and Director of Morgan Stanley
Investment Advisors Inc. and Morgan Stanley Services Company
Inc. Managing Director and Director of Morgan Stanley
Distributors Inc. and Morgan Stanley Distribution Inc. Chief
Executive Officer and Director of Morgan Stanley Trust.
Executive Vice President and Principal Executive Officer of
the Institutional and Retail Morgan Stanley Funds. Director
of Morgan Stanley SICAV. Previously, Chief Global Operations
Officer of Morgan Stanley Investment Management Inc. and
Executive Vice President of funds in the Fund Complex from
May 2003 to September 2005.
22
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER FUND SERVED DURING PAST 5 YEARS
Dennis Shea (53) Vice President Officer Managing Director of Morgan Stanley Investment Advisors
1221 Avenue of the Americas since 2006 Inc., Morgan Stanley Investment Management Inc., the Adviser
New York, NY 10020 and Van Kampen Advisors Inc. Chief Investment
Officer -- Global Equity of the same entities since February
2006. Vice President of Morgan Stanley Institutional and
Retail Funds since February 2006. Vice President of funds in
the Fund Complex since March 2006. Previously, Managing
Director and Director of Global Equity Research at Morgan
Stanley from April 2000 to February 2006.
J. David Germany (52) Vice President Officer Managing Director of Morgan Stanley Investment Advisors
20 Bank Street, since 2006 Inc., Morgan Stanley Investment Management Inc., the Adviser
Canary Wharf and Van Kampen Advisors Inc. Chief Investment
London, GRB E14 4AD Officer -- Global Fixed Income of the same entities since
December 2005. Managing Director and Director of Morgan
Stanley Investment Management Ltd. Director of Morgan
Stanley Investment Management (ACD) Limited since December
2003. Vice President of Morgan Stanley Institutional and
Retail Funds since February 2006. Vice President of funds in
the Fund Complex since March 2006.
Amy R. Doberman (45) Vice President Officer Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas since 2004 Management; Managing Director of Morgan Stanley Investment
New York, NY 10020 Management Inc., Morgan Stanley Investment Advisers Inc. and
the Adviser. Vice President of the Morgan Stanley
Institutional and Retail Funds since July 2004 and Vice
President of funds in the Fund Complex since August 2004.
Previously, Managing Director and General Counsel of
Americas, UBS Global Asset Management from July 2000 to July
2004 and General Counsel of Aeltus Investment Management,
Inc. from January 1997 to July 2000.
Stefanie V. Chang (40) Vice President and Officer Executive Director of Morgan Stanley Investment Management
1221 Avenue of the Americas Secretary since 2003 Inc. Vice President and Secretary of funds in the Fund
New York, NY 10020 Complex.
23
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER FUND SERVED DURING PAST 5 YEARS
John L. Sullivan (51) Chief Compliance Officer Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza Officer since 1989 August 2004. Prior to August 2004, Director and Managing
Oakbrook Terrace, IL 60181 Director of Van Kampen Investments, the Adviser, Van Kampen
Advisors Inc. and certain other subsidiaries of Van Kampen
Investments, Vice President, Chief Financial Officer and
Treasurer of funds in the Fund Complex and head of Fund
Accounting for Morgan Stanley Investment Management. Prior
to December 2002, Executive Director of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc.
James W. Garrett (38) Chief Financial Officer Managing Director of Morgan Stanley Investment Management,
Harborside Financial Center Officer and since 2006 Inc. since December 2006; Chief Financial Officer and
Jersey City, NJ 07311 Treasurer Treasurer of Morgan Stanley Institutional Funds since 2002
and of funds in the Fund Complex from January 2005 to August
2005 and since September 2006. Previously, Executive
Director of Morgan Stanley Investment Management Inc. from
2002 to December 2006.
24
SHAREHOLDER INFORMATION
As of April 13, 2007, to the knowledge of the Fund, no shareholder owned
beneficially more than 5% of the outstanding Common Shares of the Fund.
The table below indicates the number of Common Shares of the Fund owned
beneficially by each trustee and executive officer that owns shares of the Fund,
as of April 13, 2007, and the percentage of such Trustee's Common Shares to the
total Common Shares outstanding for the Fund.
COMMON SHARES OWNED
AS A PERCENTAGE OF
COMMON COMMON SHARES
INDEPENDENT TRUSTEES SHARES OWNED OUTSTANDING
-------------------- ------------ -------------------
Kennedy....................................... 50 <1%
INTERESTED TRUSTEE
Whalen........................................ 506 <1%
Excluding any deferred compensation balances as described in the Compensation
Table, as of December 31, 2006, the most recently completed calendar year prior
to the date of this Proxy Statement, each trustee of the Fund beneficially owned
equity securities of the Fund and of all of the funds in the Fund Complex
overseen by the trustee in the dollar range amounts specified below.
2006 TRUSTEE BENEFICIAL OWNERSHIP OF SECURITIES
INDEPENDENT TRUSTEES
TRUSTEE
-----------------------------------------------------------------------------------------
ARCH CHOATE DAMMEYER HEAGY KENNEDY KERR NELSON SONNENSCHEIN WOOLSEY
-------- ------- -------- -------- -------- ------- ------- ------------ --------
Dollar range of equity
securities in the
Fund................. none none none none $1- none none none none
$10,000
Aggregate dollar range
of equity securities
in all registered
investment companies
overseen by trustee
in the Fund
Complex.............. over $10,001- over $50,001- over $1- $1- $50,001- over
$100,000 $50,000 $100,000 $100,000 $100,000 $10,000 $10,000 $100,000 $100,000
INTERESTED TRUSTEE
TRUSTEE
--------
WHALEN
--------
Dollar range of equity securities in the Fund............... $1-
$10,000
Aggregate dollar range of equity securities in all
registered investment companies overseen by trustee in the
Fund Complex.............................................. over
$100,000
25
Including deferred compensation balances (which are amounts deferred and thus
retained by the Fund as described in the Compensation Table), as of December 31,
2006, the most recently completed calendar year prior to the date of this Proxy
Statement, each trustee of the Fund had in the aggregate, combining beneficially
owned equity securities and deferred compensation of the Fund and of all of the
funds in the Fund Complex overseen by the trustee, the dollar range of amounts
specified below.
2006 TRUSTEE BENEFICIAL OWNERSHIP AND
DEFERRED COMPENSATION
INDEPENDENT TRUSTEES
TRUSTEE
--------------------------------------------------------------------------------------------
ARCH CHOATE DAMMEYER HEAGY KENNEDY KERR NELSON SONNENSCHEIN WOOLSEY
-------- -------- -------- -------- -------- -------- -------- ------------ --------
Dollar range of
equity securities
and deferred
compensation in the
Fund................ none over over none $1- none none none none
$100,000 $100,000 $10,000
Aggregate dollar
range of equity
securities and
deferred
compensation in all
registered
investment companies
overseen by trustee
in Fund Complex..... over over over over over over over over over
$100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000
INTERESTED TRUSTEE
TRUSTEE
--------
WHALEN
--------
Dollar range of equity
securities and deferred
compensation in the Fund....... $1-
$10,000
Aggregate dollar range of equity
securities and deferred
compensation in all registered
investment companies overseen
by trustee in the Fund
Complex........................ over
$100,000
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 30(f) of the 1940 Act and Section 16(a) of the Securities Exchange Act
of 1934, as amended, require the Fund's Trustees, officers, investment adviser,
affiliated persons of the investment adviser and persons who own more than 10%
of a registered class of the Fund's equity securities to file forms with the SEC
and the New York Stock Exchange or American Stock Exchange, as applicable,
reporting their affiliation with the Fund and reports of ownership and changes
in ownership of Fund Common Shares. These persons and entities are required by
SEC regulation to furnish the Fund with copies of all such forms they file.
Based on a review of
26
these forms furnished to the Fund, the Fund believes that during its last fiscal
year, its Trustees, officers, Adviser and affiliated persons of the Adviser
complied with the applicable filing requirements.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Trustees of the Fund, including a majority of the Trustees who
are not "interested persons" of the Fund (as defined by the 1940 Act), has
selected Deloitte & Touche LLP ("D&T") as the independent auditors to examine
the financial statements for the current fiscal year of the Fund. The selection
of D&T for the current fiscal year was recommended and approved by the Fund's
audit committee and approved by the Fund's Board. The Fund knows of no direct or
indirect financial interest of D&T in the Fund.
AUDIT AND OTHER FEES
The Fund and certain "covered entities" were billed the following amounts by
D&T during the Fund's most recent two fiscal years.
FISCAL YEAR ENDED JUNE 30, 2006
NON-AUDIT FEES
---------------------------------------
AUDIT AUDIT- ALL TOTAL
ENTITY FEES RELATED TAX OTHER NON-AUDIT TOTAL
------ -------- -------- ------ ----- --------- --------
Fund.................. $ 31,800 $ 0 $1,600(3) $0 $ 1,600 $ 33,400
Covered Entities(1)... N/A $244,200(2) $ 0 $0 $244,200 $244,200
FISCAL YEAR ENDED JUNE 30, 2005
NON-AUDIT FEES
---------------------------------------
AUDIT AUDIT- ALL TOTAL
ENTITY FEES RELATED TAX OTHER NON-AUDIT TOTAL
------ ------- -------- ------ ----- --------- --------
Fund................... $30,855 $ 0 $1,600(3) $0 $1,600 $ 32,455
Covered Entities(1).... N/A $321,000(2) $ 0 $0 $ 0 $321,000
---------------
(1) Covered Entities include the Adviser (excluding sub-advisors) and any entity
controlling, controlled by or under common control with the Adviser that
provides ongoing services to the Fund.
(2) Audit-Related Fees represent assurance and related services provided that
are reasonably related to the performance of the audit of the financial
statements of the Covered Entities and funds advised by the Adviser or its
affiliates, specifically attestation services provided in connection with a
SAS 70 Report.
(3) Tax Fees represent tax advice and compliance services provided in connection
with the review of the Fund's tax return.
N/A -- Not Applicable.
27
The audit committee of the Board has considered whether the provision of non-
audit services performed by D&T to the Fund and "covered entities" is compatible
with maintaining D&T's independence in performing audit services. The audit
committee also is required to pre-approve services to "covered entities" to the
extent that the services are determined to have a direct impact on the
operations or financial reporting of the Fund and 100% of such services were
pre-approved by the audit committee pursuant to the audit committee's
pre-approval policies and procedures. The Board's pre-approval policies and
procedures are included as part of the Board's audit committee charter, which is
available on Van Kampen's website at www.vankampen.com.
Representatives of D&T will attend the Meeting, will have the opportunity to
make a statement if they desire to do so and will be available to answer
appropriate questions.
EXPENSES
The expenses of preparing, printing and mailing the enclosed form of proxy,
the accompanying Notice and this Proxy Statement and all other costs, in
connection with the solicitation of proxies will be borne by the Fund. The Fund
will also reimburse banks, brokers and others for their reasonable expenses in
forwarding proxy solicitation material to the beneficial owners of the shares of
the Fund. In order to obtain the necessary quorum at the Meeting, additional
solicitation may be made by mail, telephone, telegraph, facsimile or personal
interview by representatives of the Fund, the Adviser or Van Kampen Investments,
by the transfer agents of the Fund, by dealers or their representatives or by
Computershare Fund Services, a solicitation firm that may be engaged to assist
in proxy solicitation at an estimated cost of approximately $16,500.
SHAREHOLDER PROPOSALS
To be considered for presentation at a shareholders' meeting, rules
promulgated by the SEC generally require that, among other things, a
shareholder's proposal must be received at the offices of the Fund a reasonable
time before a solicitation is made. Shareholder proposals intended to be
presented at the year 2008 annual meeting of shareholders for the Fund pursuant
to Rule 14a-8 under the Exchange Act of 1934, as amended (the "Exchange Act"),
must be received by the Fund at the Fund's principal executive offices by
January 8, 2008. In order for proposals made outside of Rule 14a-8 under the
Exchange Act to be considered "timely" within the meaning of Rule 14a-4(c) under
the Exchange Act, such proposals must be received by the Fund at the Fund's
principal executive offices not later than March 24, 2008. Timely submission of
a proposal does not necessarily mean that such proposal will be included. Any
shareholder who wishes to submit a proposal for consideration at a meeting of
the Fund should send such proposal to the Fund at the
28
principal executive offices of the Fund at 1221 Avenue of the Americas, New
York, New York 10020, Attn: Van Kampen Asset Management General Counsel's
Office.
GENERAL
Management of the Fund does not intend to present and does not have reason to
believe that others will present any other items of business at the Meeting.
However, if other matters are properly presented to the Meeting for a vote, the
proxies will be voted upon such matters in accordance with the judgment of the
persons acting under the proxies.
A list of shareholders of the Fund entitled to be present and vote at the
Meeting will be available at the offices of the Fund, 1 Parkview Plaza, Oakbrook
Terrace, Illinois 60181-5555, for inspection by any shareholder during regular
business hours for ten days prior to the date of the Meeting.
Failure of a quorum to be present at the Meeting for the Fund may necessitate
adjournment and may subject the Fund to additional expense.
IF YOU CANNOT BE PRESENT IN PERSON, YOU ARE REQUESTED TO FILL IN, SIGN AND
RETURN THE ENCLOSED PROXY PROMPTLY. NO POSTAGE IS REQUIRED IF MAILED IN THE
UNITED STATES.
STEFANIE V. CHANG,
Vice President
May 1, 2007
29
[VAN KAMPEN INVESTMENTS LOGO]
VBF 07
[X] PLEASE MARK
VOTES AS IN
THIS EXAMPLE FORM OF PROXY
VAN KAMPEN BOND FUND
ANNUAL MEETING OF SHAREHOLDERS
PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The undersigned holder of Common Shares of VAN KAMPEN BOND FUND,
a Delaware business trust (the "Fund"), hereby appoints XXXXX,
XXXXX and XXXXX and each of them or their respective designees,
with full power of substitution and revocation, as proxies to
represent the undersigned at the Annual Meeting of Shareholders
to be held at the offices of Van Kampen Investments Inc., 1
Parkview Plaza, Oakbrook Terrace, Illinois 60181-5555, on Friday,
June 22, 2007 at 10:00 a.m., and any and all adjournments thereof
(the "Meeting"), and thereat to vote all XXXXX Shares which the
undersigned would be entitled to vote, with all powers the
undersigned would possess if personally present, in accordance
with the instructions indicated herein.
FOR ALL
1. Authority to vote for the election as Trustees, the nominees FOR WITHHOLD EXCEPT
named below: [ ] [ ] [ ]
Class III Trustees: (01) R Craig Kennedy, (02) Jack E.
Nelson and (03) Hugo F. Sonnenschein
------------------------------------------------------------
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
CHECK "FOR ALL EXCEPT" AND WRITE THE NOMINEE'S NAME ON THE
LINE BELOW.
------------------------------------------------------------
2. Authority to replace the Fund's fundamental policy regarding FOR AGAINST ABSTAIN
the Fund's ability to invest in securities or obligations of [ ] [ ] [ ]
foreign issuers with a non-fundamental policy.
3. To transact such other business as may properly come before
the Meeting.
If more than one of the proxies, or their substitutes, are
present at the Meeting or any adjournment thereof, they jointly
(or, if only one is present and voting then that one) shall have
authority and may exercise all powers granted hereby. This Proxy,
when properly executed, will be voted in accordance with the
instructions marked by the undersigned on the reverse side. IF NO
SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED "FOR" THE
PROPOSAL DESCRIBED HEREIN AND IN THE DISCRETION OF THE PROXIES
UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE ACCOMPANYING
NOTICE OF MEETING AND JOINT PROXY STATEMENT FOR THE MEETING TO BE
HELD ON JUNE 22, 2007.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE AND
RETURN PROMPTLY IN ENCLOSED ENVELOPE
HAS YOUR ADDRESS CHANGED? Date
-------------------------------------------- ------------------
Shareholder signature
------------------------------------------ -------------------------------------------- Date --------------
Co-owner signature (if applicable)
------------------------------------------
------------------------------------------
Mark box at right if an address change has
been noted on the reverse side of this
card. [ ]
Please sign this Proxy exactly as your name
or names appear on the books of the Fund.
When signing as attorney, trustee, executor,
administrator, custodian, guardian or
corporate officer, please give full title.
If common shares are held jointly, each
holder must sign.