The Lipper Funds, Inc.
101 Park Avenue, New York, New York 10178
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
February __, 1997
To the Stockholders:
Notice is hereby given that a special meeting (the "Meeting") of
stockholders of the Prime Lipper Europe Equity Fund, an investment portfolio
of The Lipper Funds, Inc. (the "Company") will be held at the offices of
Lipper & Company, 101 Park Avenue, 6th floor, New York, New York on Thursday,
March 10, 1997 at 10:00 a.m., New York time. A Proxy Statement which
provides information about the purpose of the Meeting and a proxy card for
you to cast your votes are included with this notice. The Meeting will be
held for the purposes of considering and voting upon:
1. The ratification and approval of a new identical (except for
the effective date and escrow provisions) investment advisory agreement
between the Company, on behalf of Prime Lipper Europe Equity Fund and
Prime Lipper Asset Management, the Fund's investment adviser.
2. Such other business as may properly come before the Meeting,
or any adjournment(s) thereof, including any adjournment(s) necessary to
obtain requisite quorums and/or approvals.
The Board of Directors of the Company recommends that you vote
"FOR" Proposal 1. The close of business on February 10, 1997 has been fixed
as the record date for the determination of stockholders entitled to notice
of and to vote at the Meeting.
By Order of the Board of Directors,
Abraham Biderman
Secretary
TO AVOID UNNECESSARY EXPENSE OR FURTHER SOLICITATION, WE URGE YOU to indicate
voting instructions on the enclosed proxy, date and sign it and return it
promptly in the envelope provided, no matter how large or small your holdings
may be.
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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /x/
Filed by a party other than the Registrant / /
Check the appropriate box:
/x/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as Permitted by
Rule 14a-6(e)(2)
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
The Lipper Funds, Inc.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/x/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0.11
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0.11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0.11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
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(1) Amount Previously Paid:
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(2) Form, Schedule or Registration No.:
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(3) Filing Party:
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(4) Date Filed:
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The Lipper Funds, Inc.
101 Park Avenue, New York, New York 10178
PROXY STATEMENT
This proxy statement is furnished in connection with the
solicitation by the Board of Directors of The Lipper Funds, Inc. (the
"Company") of proxies to be used at a special meeting (the "Meeting") of
stockholders of Prime Lipper Europe Equity Fund (the "Fund"), an investment
portfolio of the Company, to be held at the offices of Lipper & Company, 101
Park Avenue, 6th floor, New York, New York, on Thursday, March 13, 1997 at
10:00 a.m., New York time (and at any adjournment or adjournments thereof).
The Meeting is being called to consider the ratification and approval of a
new, identical (except for the effective date and escrow provisions)
investment advisory agreement between the Company, on behalf of the Fund, and
Prime Lipper Asset Management ("PLAM"), the Fund's investment adviser.
Stockholder approval of the new investment advisory agreement is
necessary because on December 20, 1996, Fiat S.p.A. concluded the sale of
Prime S.p.A. to Assicurazioni Generali S.p.A. ("Generali"), the Italian
insurance company. Prime S.p.A. is the parent company of Prime U.S.A. Inc.,
one of the two general partners of PLAM. The sale resulted in an indirect
change of control of PLAM, and an "assignment" (and termination) of the then
existing investment advisory agreement for purposes of the Investment Company
Act of 1940 (the "1940 Act"), which governs the Fund's operations. The new
investment advisory agreement, which contains no changes from the previous
investment advisory agreement other than its effective date and escrow
provisions, was approved by the Company's Board of Directors on December 18,
1996.
This proxy statement and the accompanying form of proxy are being
mailed to stockholders on or about February __, 1997. Stockholders who
execute proxies retain the right to revoke them in person at the Meeting or
by written notice received by the Secretary of the Company at any time before
they are voted. Unrevoked proxies will be voted in accordance with the
specification thereon and, unless specified to the contrary, will be voted
FOR Proposal 1. The close of business on February 10, 1997 has been fixed as
the record date (the "Record Date") for the determination of stockholders
entitled to notice of and to vote at the Meeting. Each stockholder is
entitled to one vote for each full share and an appropriate fraction of a
vote for each fractional share held. The Fund's shares of stock are issued
in three classes, Premier Shares, Retail Shares and Group Retirement Plan
Shares. As of the Record Date, there were ___________ shares of stock of the
Fund issued and outstanding in the aggregate.
In the event that a quorum is not present at the Meeting, or in the
event that a quorum is present but sufficient votes to approve any of the
proposals are not received, the persons named as proxies may propose one or
<PAGE>
more adjournments of the Meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the Meeting in person or by proxy. The persons named
as proxies will vote those proxies which they are entitled to vote FOR or
AGAINST any such proposal to adjourn to another date in their discretion. A
stockholder vote may be taken on one or more proposals in this proxy
statement prior to any such adjournment if sufficient votes have been
received for approval. Under the By-Laws of the Company, a quorum is
constituted by the presence in person or by proxy of the holders of record of
a majority of the outstanding shares of stock of the Fund entitled to vote at
the Meeting, except with respect to any matter which requires the separate
approval of one or more classes of stock, in which case the presence in
person or by proxy of the holders of one-third of the shares of all classes
entitled to vote on the matter shall constitute a quorum.
The Company will furnish without charge a copy of its semi-annual
report for the six-month period ended June 30, 1996, to any stockholder
requesting the report. Such request should be made in writing to the Company
at the address above or by calling 1-800-Lipper9 (1-800-547-7379).
BACKGROUND OF THE PROPOSAL
The Fund is one of three investment portfolios of the Company.
PLAM is a joint venture structured as an equally owned New York general
partnership between Lipper Europe L.P., a Delaware limited partnership for
which Lipper & Company, Inc. serves as general partner, and Prime U.S.A. Inc.
("Prime U.S.A."), a Delaware corporation and a wholly-owned subsidiary of
Prime S.p.A. PLAM has served as the investment adviser to the Fund since the
commencement of its operations as an investment company registered under the
1940 Act on April 1, 1996. Prior to April 1, PLAM had served as the general
partner and investment adviser to Prime Lipper Europe Fund L.P., the
predecessor limited partnership to the Fund. Lipper & Company, L.L.C., an
affiliate of PLAM serves as the investment adviser to the other two
investment portfolios of the Company.
On October 22, 1996, Fiat S.p.A. and Generali entered into an
agreement pursuant to which Generali agreed to acquire 95.1% of the
outstanding stock of Prime S.p.A. for approximately U.S.$214,000,000.
Closing of the transaction was subject to a number of conditions, including
receipt of necessary regulatory approvals. The transaction was consummated
on December 20, 1996.
As stated above, the closing of the transaction resulted in the
"assignment" and thus the termination of the then existing investment
advisory agreement between the Company, on behalf of the Fund, and PLAM. The
Board of Directors has approved a new identical (except for the effective
date and escrow provisions) investment advisory agreement between the Company
on behalf of the Fund and PLAM. In approving the new investment advisory
agreement, the Board of Directors determined that the new agreement is in the
best interests of the Fund and its stockholders, and recommended that
stockholders vote to ratify and approve the new agreement. A copy of the new
investment advisory agreement is attached as Exhibit A.
<PAGE>
PROPOSAL 1. Ratification and Approval of the New Investment
Advisory Agreement Between Prime Lipper Europe
Equity Fund and PLAM
At the Meeting, the stockholders of the Fund will be asked to vote
on the proposal to ratify and approve the new, identical investment advisory
agreement (except for the effective date and escrow provisions) between the
Company, on behalf of the Fund, and PLAM. The new investment advisory
agreement was approved by the Board of Directors of the Company, including
(as required under the 1940 Act) a majority of the directors who are not
parties to the new agreement or interested persons of any such parties, at an
in-person meeting held on December 18, 1996, contingent on stockholder
ratification and approval of the new agreement.
The new investment advisory agreement became effective as of
December 20, 1996, subject to stockholder approval. If ratified and
approved, the new investment advisory agreement will continue in effect as
described below. If the new investment advisory agreement is not ratified
and approved by stockholders, the Board of Directors intends to continue the
interim relationship with PLAM until it is able to evaluate and obtain
necessary approval of alternative advisory arrangements. The new investment
advisory agreement is reproduced as Exhibit A to this Proxy Statement.
The 1940 Act requires that investment advisory agreements generally
be approved by stockholders prior to their effectiveness. Due to the fact
that (i) the closing of the transaction could have occurred any day, (ii) the
necessary diligence required to be conducted on Generali, (iii) the time
required to solicit proxies and (iv) the desire for continuity in management
of the Fund, upon announcement of the agreement between Fiat S.p.A. and
Generali, the Fund's management determined to request exemptive relief from
the Securities and Exchange Commission to extend the time period to receive
stockholder approval. An application for exemptive relief was filed on
November 6, 1996, notice of the requested relief was published on December 2,
1996, and the order granting the requested relief was granted on December 30,
1996.
In connection with the exemptive relief discussed above, the
Company, on behalf of the Fund, has entered into an escrow arrangement with
Chase Manhattan Bank, which serves as the Fund's custodian, as escrow agent,
whereby the Fund deposits into an interest-bearing escrow account maintained
by the agent that portion of PLAM's fees payable under the new investment
advisory agreement to PLAM. The amounts held in the escrow account
(including interest earned on such paid-in fees) will be paid to PLAM only
upon stockholder approval of the new investment advisory agreement. In the
absence of such stockholder approval, such amounts in the escrow account
would be paid to the Fund.
The terms of the new investment advisory agreement are identical to
the previous investment advisory agreement, except for the effective date and
escrow provisions. Under the new investment advisory agreement, PLAM is
entitled to receive advisory fees, computed daily and paid monthly, at the
annual rates of 1.10%. PLAM was entitled to receive identical fees under the
<PAGE>
previous investment advisory agreement. The duties that PLAM is required to
perform under the new investment advisory agreement are the same as those
provided by the previous investment advisory agreement. In addition, there
are no changes anticipated in the personnel who provide services under the
new investment advisory agreement. Accordingly, the Fund will receive the
same advisory services, provided in the same manner and at the same fee
levels, as it received under the previous advisory agreement. For the period
April 1, 1996 through December 19, 1996, PLAM was entitled to receive
$_________ for advisory services to the Fund under the then existing advisory
agreement, of which $__________ was waived to maintain certain expense
limitations set forth in the Company's prospectus. The previous investment
advisory agreement was initially approved by the Board of Directors of the
Company on December 14, 1995, and by the Fund's initial shareholder, Lipper &
Company, L.P. on __________, 1996.
At a meeting held on December 18, 1996, the directors, including a
majority of the directors who are not parties to the new agreement or
interested persons of any such parties, approved the new investment advisory
agreement. The directors approved the new agreement because they believe
that continuing the Fund's arrangement with PLAM will enable the Fund to
continue to receive the same high level of investment management expertise
previously received. The directors also believed that continued engagement
of PLAM allows the Fund to continue to effectively operate prior to
stockholder approval. The factors that the Board considered most important
were continuity in the level of management services provided to the Fund, the
continuation of the advisory fee charged under the previous investment
advisory agreement, and the retention of advisory personnel to manage the
assets of the Fund.
If approved by stockholders at the Meeting, the new investment
advisory agreement will remain in effect for a one-year period following the
date of such approval. Thereafter, the new investment advisory agreement
will continue in effect for successive periods not to exceed one year,
provided that such continuance is specifically approved at least annually by
the Board of Directors of the Company, or by a vote of a majority of the
outstanding shares of the Fund, and in either case by a majority of the
directors who are not parties to the new investment advisory agreement or
interested persons (as defined in the Act) of any such parties. The new
investment advisory agreement may be terminated on 60 days' written notice at
any time by PLAM, by a vote of a majority of the Fund's outstanding shares or
by a vote of a majority of the Company's Board of Directors. The new
investment advisory agreement will terminate automatically in the event of
its assignment.
Required Vote
In accordance with the requirements of the 1940 Act, the
affirmative vote of (a) 67% or more of the shares of the Fund present at the
Meeting, if more than 50% of the then outstanding shares are present or
represented by proxy, or (b) more than 50% of the then outstanding shares of
the Fund, whichever is less, is required for the ratification and approval of
the new investment advisory agreement.
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THE DIRECTORS, INCLUDING THE "NON-INTERESTED" DIRECTORS, UNANIMOUSLY
RECOMMEND THAT THE STOCKHOLDERS VOTE "FOR" RATIFICATION AND APPROVAL OF
THE NEW INVESTMENT ADVISORY AGREEMENT.
ADDITIONAL INFORMATION
Other Matters
The Board of Directors of the Company does not know of any other
matter which may come before the Meeting. If any other matter properly comes
before the Meeting, it is the intention of the persons named in the proxy to
vote the proxies in accordance with their judgment on that matter.
Stockholder proposals to be presented at any future meeting of
stockholders of the Company must be received by the Company a reasonable time
before the Company's solicitation of proxies for that meeting in order for
such proposals to be considered for inclusion in the proxy materials related
to that meeting.
Information Regarding Shares Ownership
Set forth below is information regarding ownership of the Fund's
voting securities by persons (including groups) that owed more than 5% of the
Fund's shares of stock as of January 1, 1997, as well as that of the
Company's directors and executive officers:
Name and Address of Amount and Nature of Percent of Fund's
Beneficial Owner Beneficial Ownership Common Stock
- ------------------- -------------------- -----------------
- - -
Directors and
Officers as a group
Prime Lipper Asset Management and Affiliates
Set forth below is certain information with respect to each of the
members of the Management Committee of PLAM:
Name and Address Principal Occupation
- ---------------- --------------------
Kenneth Lipper President of Lipper &
101 Park Avenue Company, L.P.
New York, New York 10178
Abraham Biderman Executive Vice President of
101 Park Avenue Lipper & Company, L.P.
New York, New York 10178
Francisco Taranto Chief Executive Officer,
Via Turati 9 Prime S.p.A.
Milan, Italy 20121
Guido Guzzetti Director, Structured Asset
Via Turati 9 Management, Prime Investment
Milan, Italy 20121 Management SIM, S.p.A.
<PAGE>
PLAM, Lipper Europe, L.P. and Lipper & Company, Inc. are located at
101 Park Avenue, New York, New York 10178, as is Lipper & Company, L.P.,
which serves at the Company's distributor. Lipper & Company, Inc. is wholly-
owned by Kenneth Lipper together with his immediate family members. Prime
U.S.A. is located at Corporate Trust Center, 1209 Orange Street, Wilmington,
Delaware, and Prime S.p.A. is located at Via Turati 9, Milan, Italy 20121.
Generali is located at Piazza Duca Degli, Abruzzi, 2 Trieste 34132.
Administration
Chase Global Fund Services Company, located at 73 Tremont Street,
Boston, Massachusetts 02108, serves as the administrator to the Fund and the
other investment portfolios of the Company.
Expenses of Proxy Solicitation
The costs of preparing, assembling and mailing material in
connection with this solicitation of proxies will be borne by PLAM. Proxies
may also be solicited personally by officers of the Company and by regular
employees of PLAM, or its affiliates, or other representatives of the Company
or by telephone or telegraph, in addition to the use of mails.
February __, 1997
<PAGE>
EXHIBIT A
ADVISORY CONTRACT
THE LIPPER FUNDS, INC.
101 Park Avenue
New York, New York 10178
October 20, 1997
Prime Lipper Asset Management
101 Park Avenue
New York, New York 10178
Dear Sirs:
This will confirm the agreement between the undersigned (the
"Company") and you (the "Investment Adviser") as follows:
1. The Company is an open-end investment company which currently
has three investment portfolios -- Lipper High Income Bond Fund, Lipper U.S.
Equity Fund and Prime Lipper Europe Equity Fund. The Company engages in the
business of investing and reinvesting the assets of Prime Lipper Europe Equity
Fund (the "Fund") in the manner and in accordance with the investment objective
and limitations specified in the Company's Articles of Incorporation, as
amended (the "Articles") and the currently effective prospectus, including the
documents incorporated by reference therein (the "Prospectus"), relating to
the Company and the Fund, included in the Company's Registration Statement, as
amended from time to time (the "Registration Statement"), filed by the Company
under the Investment Company Act of 1940, as amended (the "1940 Act"), and the
Securities Act of 1933, as amended. Copies of the documents referred to in
the preceding sentence have been furnished to the Investment Adviser. Any
amendments to these documents shall be furnished to the Investment Adviser.
2. The Company employs the Investment Adviser to (a) make
investment strategy decisions for the Fund, (b) manage the investing and
reinvesting of the Fund's assets as specified in paragraph 1, (c) place
purchase and sale orders on behalf of the Fund and (d) provide continuous
supervision of the Fund's investment portfolio.
3. (a) The Investment Adviser shall, at its expense, provide the
Fund with office space, office facilities and personnel reasonably necessary
for performance of the services to be provided by the Investment Adviser
pursuant to this Agreement, and provide the Fund with persons satisfactory to
the Company's Board of Directors to serve as officers and employees of the
Fund.
(b) Except as provided in subparagraph (a), the Company shall be
responsible for all of the Fund's expenses and liabilities, including
organizational expenses; taxes; interest; fees (including fees paid to its
directors who are not affiliated with the Investment Adviser or any of its
affiliates); fees payable to the SEC; state securities qualification fees;
costs of preparing and printing prospectuses for regulatory purposes and for
distribution to existing shareholders; advisory and administration fees;
charges of the custodian and transfer agent; insurance premiums; auditing and
<PAGE>
legal expenses; costs of shareholders' reports and shareholders' meetings; any
extraordinary expenses; and brokerage fees and commissions, if any, in
connection with the purchase or sale of portfolio securities; and payments to
the Fund's distributor for activities intended to result in the sale of Fund
shares.
4. As manager of the Fund's assets, the Investment Adviser shall
make investments for the Fund's account in accordance with the investment
objective and limitations set forth in the Articles, the Prospectus, the 1940
Act, the provisions of the Internal Revenue Code of 1986, as amended, relating
to regulated investment companies, applicable banking laws and regulations, and
policy decisions adopted by the Company's Board of Directors from time to time.
The Investment Adviser shall advise the Company's officers and Board of
Directors, at such times as the Company's Board of Directors may specify, of
investments made for the Fund's account and shall, when requested by the
Company's officers or Board of Directors, supply the reasons for making such
investments.
5. The Investment Adviser is authorized on behalf of the Company,
from time to time when deemed to be in the best interests of the Company and
to the extent permitted by applicable law, to purchase and/or sell securities
in which the Investment Adviser or any of its affiliates underwrites, deals
in and/or makes a market and/or may perform or seek to perform investment
banking services for issuers of such securities. The Investment Adviser is
further authorized, to the extent permitted by applicable law, to select
brokers for the execution of trades for the Company, which broker may be an
affiliate of the Investment Adviser, provided that the best competitive
execution price is obtained at the time of the trade execution.
6. In consideration of the Investment Adviser's undertaking to
render the services described in this agreement, the Company agrees that the
Investment Adviser shall not be liable under this agreement for any error of
judgment or mistake of law or for any loss suffered by the Company in
connection with the performance of this agreement, provided that nothing in
this agreement shall be deemed to protect or purport to protect the Investment
Adviser against any liability to the Company or its stockholders to which the
Investment Adviser would otherwise be subject by reason of willful misfeasance,
bad faith or gross negligence in the performance of the Investment Adviser's
duties under this agreement or by reason of the Investment Adviser's reckless
disregard of its obligations and duties under this Agreement ("disabling
conduct"). The Fund will indemnify the Investment Adviser against, and hold it
harmless from, any and all losses, claims, damages, liabilities or expenses
(including reasonable counsel fees and expenses), including any amounts paid in
satisfaction of judgments, in compromise or as fines or penalties, not
resulting from disabling conduct by the Investment Adviser. Indemnification
shall be made only following: (i) a final decision on the merits by a court or
other body before whom the proceeding was brought that the Investment Adviser
was not liable by reason of disabling conduct, or (ii) in the absence of such a
decision, a reasonable determination, based upon a review of the facts, that
the Investment Adviser was not liable by reason of disabling conduct by
(a) the vote of a majority of a quorum of directors of the Fund who are neither
"interested persons" of the Fund (as defined in the 1940 Act) nor parties to
the proceeding ("disinterested non-party directors"), or (b) an independent
legal counsel in a written opinion. The Investment Adviser shall be entitled
<PAGE>
to advances from the Fund for payment of the reasonable expenses (including
reasonable counsel fees and expenses) incurred by it in connection with the
matter as to which it is seeking indemnification in the manner and to the
fullest extent permissible under law. The Investment Adviser shall provide
to the Fund a written affirmation of its good faith belief that the standard
of conduct necessary for indemnification by the Fund has been met and a written
undertaking to repay any such advance if it should ultimately be determined
that the standard of conduct has not been met. In addition, at least one of
the following additional conditions shall be met: (a) the Investment Adviser
shall provide security in form and amount acceptable to the Fund for its
undertaking; (b) the Fund is insured against losses arising by reason of the
advance; or (c) a majority of a quorum of disinterested non-party directors,
or independent legal counsel, in a written opinion, shall have determined,
based on a review of facts readily available to the Fund at the time the
advance is proposed to be made, that there is reason to believe that the
Investment Adviser will ultimately be found to be entitled to indemnification.
7. In consideration of the services to be rendered by the
Investment Adviser under this agreement, the Company shall pay the Investment
Adviser a monthly fee on the first business day of each month at an annual
rate of 1.10% of the average daily value (as determined on the days and at
the time set forth in the Prospectus for determining net asset value per
share) of the Fund's net assets during the preceding month. If the fee
payable to the Investment Adviser pursuant to this paragraph 7 begins to
accrue before the end of any month or if this agreement terminates before
the end of any month, the fee for the period from such date to the end of
such month or from the beginning of such month to the date of termination,
as the case may be, shall be prorated according to the proportion which
such period bears to the full month in which such effectiveness or
termination occurs. For purposes of calculating each such monthly fee,
the value of the Fund's net assets shall be computed in the manner
specified in the Prospectus and the Articles for the computation of the
value of the Fund's net assets in connection with the determination of the
net asset value of shares of the Fund's capital stock.
8. If the aggregate expenses incurred by, or allocated to, the
Fund in any fiscal year shall exceed the expense limitations applicable to
the Fund imposed by state securities laws or regulations thereunder, as such
limitations may be raised or lowered from time to time, the Investment
Adviser shall reimburse the Fund for such excess. The Investment Adviser's
reimbursement obligation will be limited to the amount of fees it received
under this agreement during the period in which such expense limitations
were exceeded, unless otherwise required by applicable laws or regulations.
With respect to portions of a fiscal year in which this agreement shall be
in effect, the foregoing limitations shall be prorated according to the
proportion which that portion of the fiscal year bears to the full fiscal
year. Any payments required to be made by this paragraph 8 shall be made
once a year promptly after the end of the Company's fiscal year.
9. This agreement shall continue in effect until December 27, 1997,
and thereafter for successive annual periods, provided that such continuance is
specifically approved at least annually (a) by the vote of a majority of the
Fund's outstanding voting securities (as defined in the 1940 Act) or by the
<PAGE>
Company's Board of Directors and (b) by the vote, cast in person at a
meeting called for the purpose, of a majority of the Company's directors who
are not parties to this agreement or "interested persons" (as defined in the
1940 Act) of any such party. This agreement may be terminated at any time,
without the payment of any penalty, by a vote of a majority of the Fund's
outstanding voting securities (as defined in the 1940 Act) or by a vote of
a majority of the Company's entire Board of Directors on 60 days' written
notice to the Investment Adviser or by the Investment Adviser on 60 days'
written notice to the Company. This agreement shall terminate
automatically in the event of its assignment (as defined in the 1940 Act).
10. Upon expiration or earlier termination of this agreement, the
Company shall, if reference to "Lipper" is made in the corporate name of the
Company or in the name of the Fund and if the Investment Adviser requests in
writing, as promptly as practicable change its corporate name and the name of
the Fund so as to eliminate all reference to "Lipper", and thereafter the
Company and the Fund shall cease transacting business in any corporate name
using the words "Lipper" or any other reference to the Investment Adviser or
"Lipper". The foregoing rights of the Investment Adviser and obligations of
the Company shall not deprive the Investment Adviser, or any affiliate
thereof which has "Lipper" in its name, of, but shall be in addition to, any
other rights or remedies to which the Investment Adviser and any such
affiliate may be entitled in law or equity by reason of any breach of this
agreement by the Company, and the failure or omission of the Investment
Adviser to request a change of the Company's or the Fund's name or a
cessation of the use of the name of "Lipper" as described in this
paragraph 10 shall not under any circumstances be deemed a waiver of the
right to require such change or cessation at any time thereafter for the
same or any subsequent breach.
11. Except to the extent necessary to perform the Investment
Adviser's obligations under this agreement, nothing herein shall be
deemed to limit or restrict the right of the Investment Adviser, or any
affiliate of the Investment Adviser, or any employee of the Investment
Adviser, to engage in any other business or to devote time and attention
to the management or other aspects of any other business, whether of a
similar or dissimilar nature, or to render services of any kind to any
other corporation, firm, individual or association.
12. During the period of time commencing on the date hereof
and continuing until the earlier of (a) such time as this agreement is
approved by a vote of a majority of the Fund's outstanding voting
securities (as defined in the 1940 Act) or (b) May 31, 1997, the fees
payable to the Adviser under this agreement shall be paid into an
interest-bearing account (the "Account") maintained by an escrow agent.
Such escrow agent shall not be an "affiliated person" (as defined in
the 1940 Act) of any of the parties hereto. All amounts paid into the
Account (including interest earned on such fees) may be paid to the
Adviser upon the approval of a majority of the Fund's outstanding
voting securities (as defined in the 1940 Act) of this agreement. In
the event that the shareholders of the Fund fail to approve this
agreement prior to May 31, 1997, all amounts in the Account shall be
paid to the Fund. The parties hereto expressly acknowledge that the
escrow agent may release the moneys in the Account only upon receipt of
<PAGE>
a certificate from an officer of the Company (who shall not be an
"interested person" (as defined in the 1940 Act) of the Adviser)
stating that the moneys are to be delivered to the Adviser and that
this agreement has been approved by a majority of the outstanding
voting securities of the Fund (as defined in the 1940 Act) or, in
the event that the shareholders of the Fund failed to approve the
agreement prior to the date specified above, that the moneys in the
Account are to be delivered to the Fund.
13. This agreement shall be governed by the laws of the
State of New York.
If the foregoing correctly sets forth the agreement between
the Company and the Investment Adviser, please so indicate by signing
and returning to the Company the enclosed copy hereof.
Very truly yours,
THE LIPPER FUNDS, INC.
By:________________________
Name:
Title:
ACCEPTED:
By: PRIME LIPPER ASSET MANAGEMENT
By: LIPPER EUROPE, L.P., a General
Partner
By: LIPPER & COMPANY, INC., as
General Partner
By:______________________________
Name:
Title:
By: PRIME U.S.A. INC., a General
Partner
By:______________________________
Name:
Title:<PAGE>
PRIME LIPPER EUROPE EQUITY FUND
SPECIAL MEETING OF STOCKHOLDERS -- MARCH 13, 1997
This Proxy is Solicited on Behalf of the Directors
The undersigned hereby appoints Stephen Finkel and Howard Horowitz, and
each of them, attorneys and proxies for the undersigned, with full power of
substitution and revocation, to represent the undersigned at the Special
Meeting of Stockholders of the Fund to be held at Lipper & Company, 101 Park
Avenue, 6th Floor, New York, New York 10178 on Thursday, March 13, 1997, at
10:00 a.m., and at any adjournments thereof, upon the matters set forth in
the Notice of Meeting and Proxy Statement dated February __, 1997 and upon
all other matters properly coming before said Meeting.
Please indicate your vote by an "X" in the appropriate box on the reverse
side. This proxy, if properly executed, will be voted in the manner directed
by the stockholder. If no direction is made, this proxy will be voted FOR
Proposal 1. Please refer to the Proxy Statement for a discussion of the
Proposal.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
____________________________ ________________________________
____________________________ ________________________________
____________________________ ________________________________
Continued, and to be signed and dated, on the reverse side)
<PAGE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" PROPOSAL 1.
1. The ratification and approval of a new identical (except
for the effective date and escrow provisions) investment
advisory agreement between The Lipper Funds, Inc., on
behalf of Prime Lipper Europe Equity Fund), and Prime
Lipper Asset Management, the Fund's investment adviser.
FOR / / AGAINST / / ABSTAIN / /
2. Any other business that may properly come before the
meeting.
3. I will be attending the meeting. / /
Note: Please sign exactly as your name appears on this Proxy. If
joint owners, EITHER may sign this Proxy. When signing as
attorney, executor, administrator, trustee, guardian or
corporate officer, please give your full title.
Date , 1997
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Signature(s), Title(s), if applicable
Please Sign, Date and Return the Proxy Promptly Using the Enclosed Envelope.
Votes MUST be indicated
(x) in Black or Blue ink. / /
