TYPE: PRES14A
SEQUENCE: 1
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 Rule 14a-11(c)
or Rule 14a-12
West University Fund, Inc.
(Name of Registrant as Specified in Its Charter)
__________________________________________
(Name of Person(s) Filing Proxy Statement
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how
it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as
provided by Exchange Act Rule 0-11(a)(2) and
identify the filing for which the offsetting fee
was paid previously. Identify the previous filing
by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
PRELIMINARY - SUBJECT TO COMPLETION
West University Fund, Inc.
3030 University Blvd.
Houston, Texas 77005
800-465-5657
______________________________
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD March ___, 2000
To our Shareholders:
Notice is hereby given that a Special Meeting of Shareholders of
WEST UNIVERSITY FUND, INC. (the "FUND"), will be held at 2:00 P.M., CST,
on March ____,2000, at 3030 University Blvd., Houston, Texas 77005,
for the following purposes:
1. To approve or disapprove the liquidation and termination of the
Fund pursuant to the Plan of Liquidation attached to the
accompanying Proxy Statement as EXHIBIT A.
2. To consider and act upon any other business as may properly come
before the meeting or any adjournment thereof.
Only shareholders of record at the close of business on February 16,
2000 are entitled to notice of and to vote at the meeting or any
adjournment thereof.
IT IS VERY IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THIS MEETING.
WHETHER OR NOT YOU EXPECT TO BE PRESENT, PLEASE COMPLETE, SIGN, DATE AND
PROMPTLY RETURN THE ENCLOSED PROXY CARD(S)IN THE ENCLOSED SELF-ADDRESSED,
STAMPED ENVELOPE.IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER
SOLICITATION, WE ASK YOUR COOPERATION IN MAILING YOUR PROXY CARD(S)
PROMPTLY.
J. Barry Kendrick
Secretary
Dated: February 16,1999
WEST UNIVERSITY FUND, INC.
3030 UNIVERSITY BLVD.
HOUSTON, TEXAS 77005
800-465-5657
______________________________
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
MARCH ___, 2000
This statement is furnished in connection with the solicitation by the
Board of Directors of WEST UNIVERSITY FUND, INC. (the "FUND") of proxies to
be voted at the Special Meeting of Shareholders of WEST UNIVERSITY FUND,
INC. (the "FUND") to be held at 2:00 P.M., CST, on March ____, 2000, at
3030 University Blvd., Houston, Texas 77005 for the purposes set forth in
the accompanying Notice of Special Meeting. It is expected that this Proxy
Statement and the accompanying Notice of Special Meeting will be first
mailed to shareholders on or about February ___, 1999.
If the accompanying form(s)of proxy is executed properly and
returned, shares represented by it will be voted at the meeting in
accordance with the instructions thereon. However, if no instructions are
specified, shares will be voted FOR the Plan of Liquidation and according
to the best judgment of the proxy holders on all other matters. A proxy
may be revoked at any time prior to the time it is voted by written notice
to the Secretary of the Fund at the address shown above, by submission of
a subsequent proxy or by attendance at the meeting and voting in person.
In order to be approved by shareholders, the Plan of Liquidation must
be approved by the holders of a majority of the outstanding shares of the
Fund, defined in the Investment Company Act of 1940, as amended (the "1940
ACT"), as the lesser of (i) 67% of such shares present at the meeting if
holders of more than 50% of the outstanding shares are present in person or
by proxy, or (ii) more than 50% of the outstanding shares. A proxy may
indicate that all or a portion of the shares represented thereby are not
being voted with respect to a specific proposal. This could occur, for
example, when a broker is not permitted to vote shares held in street name
on certain proposals in the absence of instructions from the beneficial
owner. Shares that are not voted with respect to a specific proposal will
be considered as not present and entitled to vote on such proposal, even
though such shares will be considered present for purposes of determining a
quorum and voting on other proposals. Abstentions on a specific proposal
will be considered as present, but not as voting in favor of such proposal.
Because the proposal to approve or disapprove the Plan of Liquidation
requires the affirmative vote of a specified percentage of shares, both
the non-voting of shares and abstentions on that proposal will have the
effect of votes against that proposal.
At the close of business on the record date, February 16, 2000,
there were 301,854 shares of the Fund outstanding, each of which shares will
be entitled to one vote at the meeting.
THE PROPOSED LIQUIDATION
(PROPOSAL NO. 1)
At a meeting held on February 16, 2000, the Board of Directors of the
Fund unanimously determined that it is in the best interests of the Fund
and the Fund's shareholders to liquidate and terminate the Fund as promptly as
practicable. At that meeting, the Board of Directors unanimously adopted the
Plan of Liquidation attached to this Proxy Statement as EXHIBIT A (the
"PLAN" or "PLAN OF LIQUIDATION"). As described below, the Board of Directors
decision is based primarily on the small size of the Fund.
As described in more detail below, the Plan generally provides that,
Promptly upon shareholder approval of the Plan, (i) the Fund will proceed
to sell or otherwise dispose of all of the assets of the Fund, (ii) the
Fund will pay or otherwise provide for the payment of all charges, taxes,
expenses and other liabilities and obligations of the Fund, and (iii) the
proceeds of the sale or other disposition of such assets remaining after
paying or providing or all of such liabilities and obligations will be
distributed to the shareholders of the Fund in proportion to the number of
shares of the Fund held by them, in one or more payments, all at such times
and in such manner as the officers of the Fund consider appropriate.
If approved at the meeting, it is anticipated that the liquidation
will be completed and the liquidating distribution(s) will be paid during
the first quarter of 2000. However, the exact date(s) of the liquidating
distribution(s) will depend on the time required to liquidate the Fund's
assets.
In order to be approved by shareholders, the Plan must be approved by
the holders of a majority of the outstanding shares of the Fund, defined in
the 1940 Act as the lesser of (i) 67% of such shares present at the meeting
if holders of more than 50% of the outstanding shares are present in person
or by proxy, or (ii) more than 50% of the outstanding shares. If the Plan
is not approved by shareholders, the Board of Directors will consider what
action, if any, should be taken in the interests of the Fund's shareholders,
including calling another special shareholders' meeting to reconsider the
Plan or another plan of liquidation, continued suspension of sales of Fund
shares or other possible alternatives.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE
FOR THE PLAN OF LIQUIDATION.
BACKGROUND AND REASONS FOR THE LIQUIDATION
The Board of Directors decision to liquidate and terminate the Fund
is based primarily on the small size of the Fund. The Board of Directors
considered various alternatives, including the possible combination of
the Fund with other unaffiliated mutual funds and investment advisors but,
after inquiries made, concluded that finding a viable merger partner was
unlikely. The Board of Directors ultimately determined at their February 16,
2000 meeting that liquidation and termination of the Fund were in the best
interest the Fund's shareholders. Among other things, the Board of Directors
determined that the proposed liquidation will permit the Fund's shareholders
to invest the distributions they receive upon the Fund's liquidation in
investment vehicles of their own choice.
PLAN OF LIQUIDATION
The following is a summary of the material features of the Plan of
Liquidation and does not purport to be complete. A copy of the complete
Plan is attached to this Proxy Statement as EXHIBIT A.
The Plan provides that, immediately upon shareholder approval of the
Plan, the Fund will cease to conduct business except for the purpose of
winding up its affairs and otherwise carrying out the terms of the Plan.
The Fund will then proceed to sell or otherwise dispose of all of the
assets of the Fund, at such times and in such manner as the officers of
the Fund consider appropriate. The Manager will supervise and manage the
sale of the Fund's portfolio securities.
The Fund will also pay or otherwise provide for the payment of all
charges, taxes, expenses and other liabilities and obligations of the
Fund, at such times and in such manner as the officers of the Fund
consider appropriate.
Pursuant to the Plan, upon the liquidation of the Fund's assets as
described above, the proceeds of the sale or other disposition of such
assets remaining after paying or providing for all of its charges, taxes,
expenses and other liabilities and obligations, will be distributed to the
shareholders of the Fund in proportion to the number of shares of the Fund
held by them and recorded on the books of the Fund in one or more payments,
all at such times and in such manner as the officers of the Fund consider
appropriate. Pursuant to the Plan, the Fund will make all filings with, and
obtain all approvals of, governmental authorities as may be required in
connection with the Plan or the termination of the Fund generally including,
without limitation, the Securities and Exchange Commission and the State of
Texas or any agency thereof. As soon as practicable after the final
liquidating distribution, the officers of the Fund will close the books of
the Fund and prepare and file all required income tax returns and other
documents. Promptly thereafter, the Fund will be statutorily terminated
under Texas law and will cease to exist, and no shareholder will have any
interest whatsoever in the Fund.
The Board of Directors may amend or terminate the Plan at any time, before
or after shareholder approval, if they determine that such action would be
advisable and in the best interests of the Fund and the Fund's shareholders.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
THE PAYMENT OF LIQUIDATING DISTRIBUTIONS TO SHAREHOLDERS WILL BE A
TAXABLE EVENT. BECAUSE THE INCOME TAX CONSEQUENCES FOR A PARTICULAR
SHAREHOLDER MAY VARY DEPENDING ON INDIVIDUAL CIRCUMSTANCES, EACH
SHAREHOLDER IS URGED TO CONSULT ITS OWN TAX ADVISERS CONCERNING THE
FEDERAL, STATE AND LOCAL TAX CONSEQUENCES OF RECEIPT OF A LIQUIDATING
DISTRIBUTION.
The following discussion is a summary of the material United States
federal income tax consequences of the proposed liquidation to certain
shareholders and does not purport to be a complete analysis or listing of
all potential tax considerations or consequences relevant to a decision
whether to vote in favor of the liquidation. The discussion does not
address all aspects of federal income taxation that may apply to
shareholders in light of their status or personal investment circumstances,
nor does it address the federal income tax consequences of the liquidation
that may apply to shareholders subject to special federal income tax
treatment, including corporations, trusts, estates, tax-exempt organizations,
non-resident aliens or dealers in securities. In addition, the discussion
does not address the effect of any applicable state, local or foreign tax
laws. The discussion assumes that shares are held as capital assets within
the meaning of Section 1221 of the Internal Revenue Code of 1986,
as amended (the "CODE").
As discussed above, pursuant to the Plan, the Fund will sell its
assets and distribute the proceeds to its shareholders. The Fund currently
qualifies, and intends to continue to qualify through the end of the
liquidation period, for treatment as a regulated investment company under
the Code, so that it will not be taxed on any of its net income from the
sale of its assets.
However, the payment of liquidating distributions to shareholders will
be a taxable event. A liquidating distribution, to the extent it is
composed of net investment company taxable income and capital gains net
income, if any, will be taxable to the shareholders as ordinary income or
as capital gains income, respectively. Each shareholder will be viewed as
having sold its Fund shares for an amount equal to the liquidating
distribution(s) he or she receives. Each shareholder will recognize gain
or loss in an amount equal to the difference between the shareholder's
adjusted tax basis in the Fund shares, and the aggregate liquidating
distribution(s) received by such shareholder. The gain or loss will be
capital gain or loss to the shareholder if the Fund shares were capital
assets in the shareholder's hands. If the shares have been held for more
than twelve months, the gain or loss will constitute long-term capital gain
or loss. For shares held one year or less, the gain or loss will
constitute a short-term capital gain or loss. To the extent that any
portion of the liquidating distribution is paid from the Fund's current or
accumulated earnings and profits, the distribution will be taxable to
shareholders as an ordinary income dividend or, if paid from net capital
gains, a capital gain dividend. Shareholders will be notified of their
respective shares of ordinary and capital gain dividends for the Fund's
final fiscal year in normal tax-reporting fashion. Amounts included in
income as dividends will increase a shareholder's adjusted tax basis in the
shareholder's shares for purposes of computing gain or loss on the receipt
of the liquidating distribution.
The Fund generally will be required to withhold tax at the rate of
31% with respect to any liquidating distribution paid to individuals and
certain other non-corporate shareholders who have not previously certified
to the Trust that their social security number or taxpayer identification
number provided to the Trust is correct and that the shareholder is not
subject to backup withholding.
IRA ACCOUNTS. The receipt of a liquidating distribution by an IRA
that holds shares of the Fund generally would not be viewed as a taxable
event to the owner. However, some IRAs that hold shares may have been
established with custodians who do not have the power to reinvest the
liquidating distribution, but instead must immediately distribute such
amounts to the IRA owner. In this situation, the distribution would be
taxable to the owner for federal income tax purposes and, if the owner has
not attained the age of 59 1/2 , would also be subject to an additional
10% early withdrawal penalty tax. However, in that circumstance, the owner
may be able to avoid a taxable event by either (i) transferring the IRA
account balance before it is distributed directly to another IRA custodian
or trustee, or (ii) rolling over the distribution within 60 days after the
date of the distribution to another IRA. An IRA may be rolled over only
once in any one-year period. Therefore, a rollover will not be an
available alternative if the IRA was rolled over at any time within the
one-year period preceding the date of the distribution. IRA shareholders
who do not wish to roll over their liquidating distributions, or who have
rolled over their IRA during the previous year, may contact the Fund at
(800) 465-5657, to make other arrangements for the transfer of their IRA.
There are many rules governing IRAs and the transfer and rollover of IRA
assets. In addition, tax results may vary depending on the status of the
IRA owner. Therefore, owners of IRAs should consult with their own tax
Advisers concerning the consequences of the liquidating distribution.
Again, the foregoing summary is generally limited to the material
federal income tax consequences to shareholders who are individual United
States citizens and who hold shares as capital assets. It does not address
the federal income tax consequences to shareholders who are, for example,
corporations, trusts, estates, tax-exempt organizations, non-resident
aliens or dealers in securities. This summary does not address state or
local tax consequences. Shareholders are urged to consult their own tax
advisers to determine the extent of the federal income tax liability they
would incur as a result of receiving a liquidating distribution, as well as
any tax consequences under any applicable state, local or foreign laws.
SECURITY OWNERSHIP BY CERTAIN BENEFICIAL OWNERS
AND DIRECTORS
The following table provides certain information as of February 16,
2000, with respect to those persons known to the Fund to be the beneficial
(and record) owners (having sole voting and dispositive power) of more than
5% of outstanding shares of the Fund:
NAME AND ADDRESS NUMBER PERCENT
OF BENEFICIAL OWNER OF SHARES OF SHARES
Richard P. Cancelmo M.D. IRA 42,862.346 14.2
Virginia S. Arendale Trust 28,294.798 9.374
J.L.& S.J. Hochenedel 25,302.505 8.382
J.P. Jackson IRA 21,735.349 7.201
Peggy Cancelmo 21,513.705 7.127
Shirley Wozencraft 19,817.294 6.565
Richard & Martha Cancelmo 15,518.727 5.141
All Directors and officers of the Fund, as a group, beneficially owned
26,134.423 shares, or 8.658% of the outstanding shares of the Fund. All of the
Fund's Directors and officers have informed the Fund that they intend to
vote all of their shares in favor of the Plan of Liquidation.
INFORMATION ABOUT THE FUND
GENERAL
The Fund is a Texas Corporation registered as an open-end
management investment company under the 1940 Act. The Fund and its
business are described in its Prospectus and Statement of Additional
Information, each dated May 3, 1999, and in its most recent annual
and semi-annual reports.
COPIES OF THE FUND'S MOST RECENT ANNUAL REPORT, AND THE MOST RECENT
SEMI-ANNUAL REPORT SUCCEEDING THE ANNUAL REPORT, ARE AVAILABLE,
WITHOUT CHARGE, BY CONTACTING THE FUND AT 3030 UNIVERSITY BLVD., HOUSTON,
TEXAS 77005 OR BY CALLING (800)-465-5657.
The Fund is not a party to any pending legal proceedings, and no such
proceedings are known to be contemplated by any governmental authorities.
MANAGEMENT
The Fund's investment adviser is Cancelmo Capital Mgt., Inc., 3030
University Blvd., Houston, Texas 77005
OTHER MATTERS
No business other than as set forth herein is expected to come before
the meeting, but should any other matter requiring a vote of shareholders
properly arise, including any question as to an adjournment of the meeting,
the persons named in the enclosed form(s) of proxy will vote thereon
according to their best judgment in the interests of the Fund.
SHAREHOLDER PROPOSALS
A shareholder proposal intended to be presented at any subsequent meeting
of the shareholders of the Fund must be received by the Fund a reasonable
time before the Board of Directors makes the solicitation relating to such
meeting in order to be included in the Fund's proxy statement and forms of
proxy relating to that meeting.
J. Barry Kendrick
Secretary
Dated: February 16, 2000
EXHIBIT A
PLAN OF LIQUIDATION
THIS PLAN OF LIQUIDATION (the "PLAN") is adopted by the Board of
Directors of WEST UNIVERSITY FUND, Inc., a Texas Corporation (the "FUND"),
and provides for the complete liquidation and termination of the Fund.
1. SHAREHOLDER APPROVAL.
This Plan shall be submitted for approval by the shareholders of the
Fund, at a special meeting of shareholders to be called and held for such
purpose in accordance with the Fund's By-Laws.
2. TERMINATION OF BUSINESS OPERATIONS.
Immediately upon shareholder approval of this Plan, the Fund shall
cease to conduct business except for the purpose of winding up its affairs
and otherwise carrying out the terms of this Plan. The liquidation of the
Fund contemplated hereby shall be completed as soon as practicable after
the date of such approval.
3. LIQUIDATION OF ASSETS.
As soon as practicable after shareholder approval of this Plan, the
Fund shall proceed to sell or otherwise dispose of all of the assets of
the Fund, at such times and in such manner as the officers of the Fund
shall consider appropriate, in order to reduce the assets of the Fund to
distributable form in cash, securities or other property, or any combination
thereof. The Fund's investment adviser, Cancelmo Capital Mgt., Inc. (the
"MANAGER"), shall supervise and manage the sale of the Fund's
portfolio securities.
4. PAYMENT OF LIABILITIES.
The Fund shall pay or otherwise provide for the payment of all
charges, taxes, expenses and other liabilities and obligations of the
Fund, at such times and in such manner as the officers of the Fund shall
consider appropriate
5. DISTRIBUTIONS TO SHAREHOLDERS.
Upon the liquidation of the Fund's assets as aforesaid, the proceeds
of the sale or other disposition of such assets remaining after paying or
providing for all of its charges, taxes, expenses and other liabilities and
obligations, shall be distributed to the shareholders of the Fund in
proportion to the number of shares of the Fund held by them and recorded on
the books of the Fund in one or more payments, all at such times and in
such manner as the officers of the Fund shall consider appropriate.
6. FILINGS; ETC.
The Fund shall make all such filings, notices and declarations with,
and use all reasonable commercially reasonable efforts to obtain all such
consents, approval or authorizations of, all governmental authorities as
may be required in connection with this Plan or the termination of the
Fund generally including, without limitation, the Securities and Exchange
Commission and the State of Texas or any agency thereof.
7. MISCELLANEOUS.
(a) The Board of Directors may modify, amend or terminate this Plan and the
transactions contemplated hereby at any time, before or after shareholder
approval, if they determine that such action would be advisable and in the
best interests of the Fund and the shareholders of the Fund.
(b) The Board of Directors and officers of the Fund shall have authority
to execute and deliver on behalf of the Fund any and all such
agreements, instruments, certificates or other documents, make such filings
and give such notices, and take any and all such other actions, as they may
deem necessary or desirable to consummate and make effective the
transactions contemplated by this Plan, and otherwise to implement the
intents and purposes of this Plan (including, without limitation, the
execution and filing of all tax returns, forms and other documents).
(c) This Plan shall be governed and construed in accordance with the
laws of the State of Texas.
WEST UNIVERSITY FUND, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
I, the undersigned shareholder of WEST UNIVERSITY FUND, INC.
(the "Fund"), hereby appoint Richard P. Cancelmo, Jr. and J. Barry Kendrick,
or either of them singly, my proxies with full power of substitution, to vote
all shares of the Fund which I am entitled to vote at the Special Meeting of
Shareholders to be held at 2:00 P.M., CST, on March ____, 2000, at 3030
University Blvd., Houston, Texas 77005, and at any adjournment thereof, as
follows:
1. Proposal to approve or disapprove the liquidation and termination of
the Fund pursuant to the Plan of Liquidation.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. In their discretion on any other matters that may properly come before
the meeting or any adjournment thereof.
(Continued and to be signed on the other side)
(Continued from other side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
SPECIFIED HEREON AND, IN THE ABSENCE OF SPECIFICATION, WILL BE VOTED FOR
THE PLAN OF LIQUIDATION AND ACCORDING TO THE BEST JUDGMENT OF THE PROXY
HOLDERS ON ALL OTHER MATTERS.
Please sign exactly as name appears below. When shares are held by
two or more persons, all of them should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as
such. If a corporation, please sign in full corporate name by a duly
authorized officer. If a partnership, please sign in partnership name by
authorized person. Receipt of Notice of Special Meeting of Shareholders
and Proxy Statement is hereby acknowledged.
Signature Signature if Held Jointly
Dated: __________________, 2000
Please mark, sign, date and return this
proxy card promptly using the enclosed
envelope.
