SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT )F 1934
(AMENDMENT NO. ___)
Filed by the Registrant [X]
Filed by a Party other than the Registrant []
Check the appropiate box:
[ ] Preliminary Proxy Statement.
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2)).
[X] Definitive Proxy Statement.
[ ] Definitive Additional Materials.
[ ] Soliciting Material Pursuant to 250.14a-11(c) or 250.14a-12.
FRONTEGRA FUNDS, 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 appropiate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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 calcuted and state how it was determined):
(4) Proposed maximum aggregate 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:
<PAGE>
FRONTEGRA TOTAL RETURN BOND FUND
FRONTEGRA OPPORTUNITY FUND
Each, a Series of
FRONTEGRA FUNDS, INC.
400 Skokie Boulevard, Suite 500
Northbrook, Illinois 60062
PROXY STATEMENT MATERIALS
IMPORTANT VOTING INFORMATION INSIDE
Table of Contents
Letter from the Co-Presidents Front Cover Page
Notice of Special Meeting of Shareholders 2
Joint Proxy Statement 3
Proxy Card Back Cover Page
<PAGE>
FRONTEGRA TOTAL RETURN BOND FUND
FRONTEGRA OPPORTUNITY FUND
Each, a Series of
FRONTEGRA FUNDS, INC.
400 Skokie Boulevard, Suite 500
Northbrook, Illinois 60062
July 9, 1999
Dear Shareholder:
I am writing to inform you of the upcoming Special
Meeting of Shareholders of the Frontegra Total Return
Bond Fund and the Frontegra Opportunity Fund (the
"Funds") to be held at 10:00 a.m., Wednesday, July 28,
1999, at 400 Skokie Boulevard, Suite 500, Northbrook,
Illinois 60062. At this meeting, you are being asked
to vote on an important proposal affecting the Funds:
to approve a new sub-advisory agreement between
Frontegra Asset Management, Inc. ("Frontegra"), the
adviser to the Funds, and Reams Asset Management
Company, LLC ("Reams"), the sub-adviser to the Funds.
Because of a transfer of ownership at Reams, the
current sub-advisory agreement will terminate on the
date of the transfer unless approved by the
shareholders of each Fund. The new sub-advisory
agreement is substantially identical to the current sub-
advisory agreement except for the dates of execution,
effectiveness and termination. The Board of Directors
of Frontegra Funds, Inc. (the "Company") unanimously
believes that this proposal is in the Funds' and your
best interest.
The Board of Directors of the Company has
unanimously approved this proposal and recommends a
vote "FOR" the proposal. If you have any questions
regarding the issues to be voted on or need assistance
in completing your proxy card, please contact us at 1-
888-825-2100.
Thank you for investing in the Funds and for your
continuing support.
Sincerely,
William D. Forsyth, III
Co-President of Frontegra Funds, Inc.
Thomas J. Holmberg, Jr.
Co-President of Frontegra Funds, Inc.
Enclosures
<PAGE>
FRONTEGRA TOTAL RETURN BOND FUND
FRONTEGRA OPPORTUNITY FUND
Each, a Series of
FRONTEGRA FUNDS, INC.
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that a Special Meeting of
Shareholders of the Frontegra Total Return Bond Fund
and the Frontegra Opportunity Fund (the "Funds") will
be held at 400 Skokie Boulevard, Suite 500, Northbrook,
Illinois 60062 on Wednesday, July 28, 1999, at 10:00
a.m., local time, to consider and act upon the proposal
noted below:
1. To approve the new sub-advisory agreement between
Frontegra Asset Management, Inc., the adviser to the
Funds, and Reams Asset Management Company, LLC, the sub-
adviser to the Funds; and
2. To consider and act upon any other business which
may properly come before the Meeting or any
adjournments thereof.
Only shareholders of record at the close of
business on Wednesday, June 30, 1999, the record date
for this Meeting, shall be entitled to notice of, and
to vote at, the Meeting or any adjournments thereof.
YOUR VOTE IS IMPORTANT.
PLEASE RETURN YOUR PROXY CARD PROMPTLY.
As a shareholder of the Frontegra Total Return
Bond Fund and/or the Frontegra Opportunity Fund, you
are asked to attend the Meeting either in person or by
proxy. If you are unable to attend the Meeting in
person, we urge you to complete, sign, date and return
the enclosed proxy card in the enclosed postage prepaid
envelope. Your prompt return of the proxy card will
help assure a quorum at the Meeting and avoid
additional expenses to the Funds associated with
further solicitation. Sending in your proxy card will
not prevent you from voting your shares in person at
the Meeting and you may revoke your proxy by advising
the Secretary of Frontegra Funds, Inc. in writing (by
subsequent proxy or otherwise) of such revocation at
any time before it is voted.
By Order of the Board of Directors,
Thomas J. Holmberg, Jr.
Secretary
Northbrook, Illinois
July 9, 1999
<PAGE>
FRONTEGRA TOTAL RETURN BOND FUND
FRONTEGRA OPPORTUNITY FUND
Each, a Series of
FRONTEGRA FUNDS, INC.
400 Skokie Boulevard, Suite 500
Northbrook, Illinois 60062
JOINT PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
To be held on July 28, 1999
General. This Joint Proxy Statement is being
furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board") of
Frontegra Funds, Inc. (the "Company") for the Frontegra
Total Return Bond Fund (the "Total Return Bond Fund")
and the Frontegra Opportunity Fund (the "Opportunity
Fund") (collectively, the "Funds"). The proxies will
be voted at the Special Meeting (the "Meeting") of
Shareholders to be held at 400 Skokie Boulevard, Suite
500, Northbrook, Illinois 60062 on Wednesday, July 28,
1999, at 10:00 a.m., local time, and any adjournments
thereof, for the purposes set forth in the enclosed
Notice of Special Meeting of Shareholders. The Notice
of Special Meeting of Shareholders, this Joint Proxy
Statement and the enclosed proxy card are first being
mailed to shareholders on or about July 9, 1999.
Record Date/Shareholders Entitled to Vote. Each
Fund is a separate investment portfolio, or series, of
the Company, a Maryland corporation and registered
investment company under the Investment Company Act of
1940, as amended (the "1940 Act"). The record holders
of outstanding shares of each Fund are entitled to one
vote per share (and a fractional vote per fractional
share) on all matters presented at the Meeting. Only
shareholders of record as of the close of business on
Wednesday, June 30, 1999 (the "Record Date"), will be
entitled to notice of, and to vote at, the Meeting and
any adjournments thereof. As of the Record Date, there
were 1,650,159.135 issued and outstanding shares of the
Total Return Bond Fund and 537,574.441 issued and
outstanding shares of the Opportunity Fund.
Share Ownership. The following table sets forth
information regarding the beneficial ownership of the
Funds' outstanding shares as of the Record Date by (i)
the directors and executive officers of the Company,
(ii) the directors and executive officers of the
Company as a group and (iii) persons who are known by
the Funds to beneficially own more than 5% of any
Fund's outstanding shares:
Number of
Name and Address Fund Shares Percentage
William D. Forsyth(1) Total Return Bond Fund 0 *
Opportunity Fund 4,730.361 *
Thomas J. Holmberg, Jr.(1) Total Return Bond Fund 0 *
Opportunity Fund 0 *
David L. Heald(2) Total Return Bond Fund 126.586 *
Opportunity Fund 105.482 *
All directors and Total Return Bond Fund 126.586 *
executive officers as Opportunity Fund 4,835.840 *
a group (3 persons)
_______________
(1) The address of Mr. Forsyth and Mr. Holmberg is
Frontegra Asset Management, Inc., 400 Skokie
Boulevard, Suite 500, Northbrook, Illinois 60062.
(2) Mr. Heald's address is 400 Skokie Boulevard,
Suite 260, Northbrook, Illinois 60062.
* Less than 1%.
<PAGE>
<TABLE>
<CAPTION>
Number of
Name and Address Fund Shares Percentage
<S> <C> <C> <C>
Bankers Trust Company, Trustee Total Return Bond Fund 566,274.085 34.316%
F/B/O Southern Illinois Hospital
Church Street Station
Post Office Box 9014
New York, New York 10008
Jerry Branson and Paul Hopkins, Trustees Total Return Bond Fund 375,861.928 22.777%
F/B/O IBEW Local 461 Pension Fund
1661 Landmark Road
Aurora, Illinois 60506
Walt Loukota and John Negro, Trustees Total Return Bond Fund 364,734.036 22.103%
F/B/O IBEW Local 405 Retirement Savings
Fund
150 1st Avenue N.E., Suite 375
Cedar Rapids, Iowa 52401
Bankers Trust Company, Trustee Total Return Bond Fund 199,233.828 12.074%
F/B/O Culver Educational Foundation
Mike Bloebaum
648 Grassmere Park Road MS 7200
Nashville, Tennessee 37211
Ed Otstott OBA Midwest Ltd., Trustee Opportunity Fund 189,709.736 35.290%
F/B/O IBEW Local 117 Pension Fund
8160 South Cass Avenue
Darien, Illinois 60561
Culver Educational Foundation Opportunity Fund 136,591.566 25.409%
1300 Academy Road
Post Office Box 156
Culver, Indiana 46511
Reams Foundation, Inc. Opportunity Fund 55,074.500 10.245%
Post Office Box 1377
Columbus, Indiana 47202
Jennifer Sagar, Trustee Opportunity Fund 53,365.027 9.927%
F/B/O UA Local 125
Retirement Savings Fund
Eastern Iowa Fringe Benefit Funds
205 50th Street Avenue S.W.
Cedar Rapids, Iowa 52404
G. Segal, H.Silverstone and Opportunity Fund 40,407.569 7.517%
B. Schneidewind, Trustees
F/B/O Euromarket Designs Inc.
Profit Sharing Trust
725 Landwehr Road
Northbrook, Illinois 60062
<PAGE>
Number of
Name and Address Fund Shares Percentage
<S> <C> <C> <C>
James Gallery OBA Midwest Ltd., Trustee Opportunity Fund 34,757.492 6.466%
Midwest Ltd., Trustee
F/B/O IBEW Local 9 and
Line Clearance
Contractors Pension Fund
8160 South Cass Avenue
Darien, Illinois 60561
</TABLE>
Voting of Proxies. Whether you expect to be
personally present at the Meeting or not, please mark,
sign, date and return the enclosed proxy card.
Properly executed proxies will be voted as you
instruct. If no choice is indicated, proxies will be
voted "FOR" proposal 1 set forth in the Notice and in
accordance with the best judgment of the persons named
as proxies in the enclosed proxy card as to proposal 2.
Any shareholder giving a proxy has the power to revoke
it at any time before the Meeting by advising the
Secretary of the Company in writing (by subsequent
proxy or otherwise) of such revocation at any time
before it is voted, or by attending the Meeting and
voting in person. Attendance by a shareholder at the
Meeting does not, in itself, revoke a proxy. If not so
revoked, the shares represented by the proxy will be
voted at the Meeting, and any adjournments thereof, as
instructed.
Quorum Required to Hold Meeting. Under the
Company's By-Laws, a quorum is constituted by the
presence in person or by proxy of one-third of the
outstanding shares of all series entitled to vote at
the Meeting. When any one or more series is entitled
to vote as a single series, a quorum is constituted by
the presence of one-third of each such series entitled
to vote.
As noted above, each Fund is a separate "series"
of the Company. Proposal 1 set forth in the Notice
requires separate voting by series. Accordingly, for
purposes of the Meeting, a quorum will be constituted
by the presence in person or by proxy of one-third of
the outstanding shares of each Fund.
Abstentions and broker non-votes (i.e., proxies
from brokers or nominees indicating that they have not
received instructions from the beneficial owners on an
item for which the brokers or nominees do not have
discretionary power to vote) will be treated as present
for determining whether a quorum is present with
respect to a particular matter. Abstentions and broker
non-votes will not, however, be counted as voting on
any matter at the Meeting, except that for any proposal
requiring the affirmative vote of a Fund's outstanding
shares for approval, a broker non-vote or abstention
will have the effect of a vote against the proposal.
In the event that a quorum is present at the
Meeting but sufficient votes to approve a proposal are
not received, the Secretary of the Company may adjourn
the Meeting to permit further solicitation of proxies.
Method and Cost of Proxy Solicitation. Proxies
will be solicited by the Company primarily by mail.
The solicitation may also include telephone, facsimile,
telegraph or oral communications by certain officers or
employees of the Funds or the Funds' investment
adviser, Frontegra Asset Management, Inc.
("Frontegra"), who will not be paid for these services.
The Funds' sub-adviser, Reams Asset Management Company,
LLC ("Reams") will pay the costs of the Meeting and the
expenses incurred in connection with the solicitation
of proxies, including those expenses incurred by
Frontegra. Reams will also reimburse brokers and other
nominees for their reasonable expenses in communicating
with persons for whom they hold shares of the Funds.
The Funds' investment adviser is Frontegra, 400
Skokie Boulevard, Suite 500, Northbrook, Illinois
60062. The Funds' administrator is Sunstone Financial
Group, Inc., 207 East Buffalo Street, Suite 400,
Milwaukee, Wisconsin 53202. The Funds' sub-adviser is
Reams, 227 Washington Street, Columbus, Indiana 47201.
COPIES OF THE FUNDS' MOST RECENT ANNUAL AND SEMI-
ANNUAL REPORTS ARE AVAILABLE WITHOUT CHARGE UPON
WRITING TO THE FUNDS AT 400 SKOKIE BOULEVARD, SUITE
500, NORTHBROOK, ILLINOIS 60062 OR BY CALLING, TOLL-
FREE, 1-888-825-2100.
<PAGE>
PROPOSAL 1: TO APPROVE A NEW SUB-ADVISORY AGREEMENT BETWEEN FRONTEGRA
ASSET MANAGEMENT INC. AND REAMS ASSET MANAGEMENT COMPANY, LLC.
Pursuant to a sub-advisory agreement dated October
30, 1996 (the "Current Sub-Advisory Agreement"), Reams
currently provides sub-advisory services to the Funds
and, subject to the supervision of Frontegra, the
adviser to the Funds, manages the portfolio assets of
the Funds. The Current Sub-Advisory Agreement was
approved by the initial shareholders of each Fund on
October 9, 1996. Mr. Fred W. Reams currently owns an
approximate 67% interest in Reams and Mr. Mark M. Egan
owns an approximate 7% interest in Reams. Following a
transfer of ownership within the organization of Reams,
Mr. Reams will own an approximate 10% interest in Reams
and Mr. Egan will own an approximate 60% interest in
Reams. This transfer of ownership will constitute a
"change of control" of Reams within the meaning of
Section 2(a)(4) of the 1940 Act.
Section 15(a) of the 1940 Act prohibits any person
from serving as an investment adviser to a registered
investment company except pursuant to a written
contract that has been approved by the shareholders.
Section 15(a) also provides that any such advisory
contract must terminate on its "assignment" and Section
2(a)(4) provides that a change of control of the
investment adviser constitutes an assignment.
Consequently, the transfer of ownership at Reams will
cause the Current Sub-Advisory Agreement to terminate.
In order for Reams to continue to serve as sub-adviser
to the Funds, shareholders of each Fund must approve a
new sub-advisory agreement (the "New Sub-Advisory
Agreement"). If approved by the Shareholders of the
Funds, the New Sub-Advisory Agreement will be executed
and become effective upon the effective date of the
transfer of ownership of Reams (currently scheduled for
July 30, 1999). The New Sub-Advisory Agreement is
substantially identical to the Current Sub-Advisory
Agreement except for the dates of execution,
effectiveness and termination.
Summary of the Current Sub-Advisory Agreement and
the New Sub-Advisory Agreement. A copy of the New Sub-
Advisory Agreement marked to indicate the changes
between the Current Sub-Advisory Agreement and the New
Sub-Advisory Agreement is attached to this Proxy
Statement as Exhibit A. The following description of
the Agreements is only a summary. You should refer to
Exhibit A for the complete Current and New Sub-Advisory
Agreements. Both the Current and New Sub-Advisory
Agreements provide that Reams provides certain
investment advisory services to the Funds, including
investment research and management, subject to the
supervision of the Board of Directors and Frontegra.
Both the Current Sub-Advisory Agreement and the New Sub-
Advisory Agreement provide that Frontegra will pay
Reams a fee with respect to each Fund based on that
Fund's average daily net assets. Under both the
Current and New Sub-Advisory Agreements, Reams is
compensated by Frontegra for its investment advisory
services at the annual rate of 0.45% of the Opportunity
Fund's average daily net assets and 0.20% of the Total
Return Bond Fund's average daily net assets.
With respect to the Opportunity Fund, Reams may
pay a broker a commission in excess of that which
another broker might have charged for effecting the
same transaction, in recognition of the value of the
research, software and subscriptions provided by the
broker to Reams.
During the fiscal year ended October 31, 1998,
Reams received no compensation from Frontegra for its
investment advisory services to the Opportunity Fund
due to a fee waiver by Reams. Frontegra voluntarily
waived its management fee to ensure that the
Opportunity Fund's total operating expenses did not
exceed 0.90% and Reams, in turn, waived its sub-
advisory fee. During the fiscal year ended October 31,
1998, Reams received $49,758 as compensation for its
investment advisory services to the Total Return Bond
Fund.
Information regarding the principal executive
officers of Reams is set forth below.
Fred W. Reams is the President of Reams. Robert
A. Crider is the Senior Vice President-Fixed Income
Management of Reams. David R. Milroy is the Senior
Vice President-Equity Management of Reams. David B.
McKinney is the Vice President-Administration and
Secretary of Reams. Mark M. Egan is the Senior Vice
President-Fixed Income Management of Reams. James L.
Brookover is the Vice President of Reams. The address
of all of the above individuals is 227 Washington
Street, Columbus, Indiana 47201.
Frontier Partners, Inc., an affiliate of
Frontegra, acts as a third party solicitor on behalf of
Reams and has a 2.2% nonvoting ownership interest in
Reams.
Required Vote. Approval of the New Sub-Advisory
Agreement requires the affirmative vote of a "majority
of the outstanding voting securities" of each Fund.
Under the 1940 Act, a "majority of the outstanding
<PAGE>
voting securities" means the affirmative vote of the
lesser of (a) 67% or more of the shares of the Fund
present at the Meeting or represented by proxy if the
holders of more than 50% of the outstanding shares are
present at the Meeting or represented by proxy, or (b)
more than 50% of the outstanding shares. If the New
Sub-Advisory Agreement is approved by each Fund's
shareholders, it will become effective on or about July
30, 1999. If the shareholders of either Fund do not
approve the New Sub-Advisory Agreement, the Current Sub-
Advisory Agreement will terminate with respect to that
Fund and Reams will cease to serve as the sub-adviser
of that Fund.
Recommendation of the Board of Directors. The
Board believes that the terms and conditions of the New
Sub-Advisory Agreement are fair to, and in the best
interests of, each Fund and its shareholders. The
Board believes that, despite the transfer of ownership
at Reams, there will be no change in the services
provided by Reams to each Fund and there will be no
change in the portfolio managers who will handle the
day-to-day management responsibilities for each Fund's
portfolio. Accordingly, the Board recommends that the
shareholders of each Fund vote to approve the New Sub-
Advisory Agreement.
PROPOSAL 2: OTHER MATTERS
The Board knows of no other matters that may come
before the Meeting, other than proposal 1 as set forth
above. If any other matters properly come before the
Meeting, it is the intention of the persons acting
pursuant to the enclosed proxy card to vote the shares
represented by such proxies in accordance with their
best judgment with respect to such matters.
SHAREHOLDER PROPOSALS
As a Maryland Corporation, the Company, on behalf
of the Funds, is not required to hold shareholder
meetings on a regular basis. Accordingly, the Company
does not intend to hold such meetings unless required
to do so under the 1940 Act. Any shareholder who
wishes to submit a proposal for consideration at the
next meeting of shareholders, when and if such meeting
is called, should submit such proposal to the Company
within a reasonable time before solicitation of proxies
for such meeting occurs. Shareholders should be aware,
however, that unless certain federal rules are complied
with, the mere submission of a proposal to the Company
does not guarantee that it will be considered at the
next meeting of shareholders.
By Order of the Board of Directors,
Thomas J. Holmberg, Jr.
Secretary
Northbrook, Illinois
July 9, 1999
<PAGE>
Exhibit A
AMENDED AND RESTATED SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT dated as of the 2nd day of
August, 1999, between Frontegra Asset Management, Inc., an Illinois
corporation (the "Adviser"), and Reams Asset Management
Company, LLC, a limited liability company organized
under the laws of the State of Indiana (the "Sub-Adviser").
WHEREAS the Adviser has entered into an Investment
Advisory Agreement dated as of October 30, 1996 (the
"Advisory Agreement") with Frontegra Funds, Inc. (the
"Fund"), an open-end management investment company
registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), with respect to certain of
the Fund's investment portfolios; and
WHEREAS the Adviser wishes to retain the Sub-
Adviser to furnish certain investment advisory services
to such portfolios, and the Sub-Adviser is willing to
furnish those services;
NOW, THEREFORE, in consideration of the premises
and mutual covenants herein contained, the parties
agree as follows:
1. Appointment. The Adviser hereby appoints the
Sub-Adviser as an investment sub-adviser with respect
to each of the Fund's portfolios named on an Exhibit to
this Agreement (each, a "Portfolio") for the period and
on the terms set forth in this Agreement. The Sub-
Adviser accepts such appointment and agrees to render
the services herein set forth, for the compensation
herein provided.
2. Duties as Sub-Adviser. (a) Subject to the
supervision of and any guidelines adopted by the Fund's
Board of Directors (the "Board") and the Adviser, the
Sub-Adviser will provide a continuous investment
program for the Portfolios, including investment
research and management. The Sub-Adviser will
determine from time to time what investments will be
purchased, retained or sold by the Portfolios. The Sub-
Adviser will be responsible for placing purchase and
sell orders for investments and for other related
transactions. The Sub-Adviser will provide services
under this Agreement in accordance with each
Portfolio's investment objectives, policies and
restrictions as stated with respect to such Portfolio
in the Fund's Registration Statement on Form N-1A.
(b) The Sub-Adviser agrees that, in placing
orders with brokers, it will obtain the best net result
in terms of price and execution; provided that, on
behalf of the Portfolio's, the Sub-Adviser may, in its
discretion, use brokers who provide the Sub-Adviser
with research, analysis, advice and similar services to
execute transactions with respect to a Portfolio, and
the Sub-Adviser may pay to those brokers in return for
brokerage and research services a higher commission
than may be charged by other brokers, so long as (i)
such commission is paid in compliance with all
applicable state and Federal laws and in accordance
with this Agreement and (ii) the Sub-Adviser has
determined in good faith that such commission is
reasonable in terms either of the particular
transaction or of the overall responsibility of the Sub-
Adviser to such Portfolio and its other clients and
that the total commissions paid by such Portfolio will
be reasonable in relation to the benefits to such
Portfolio over the long term. In no instance will
<PAGE>
securities of any Portfolio be purchased from or sold
to the Sub-Adviser, or any affiliated person thereof
except in accordance with the Federal securities laws
and the rules and regulations thereunder. The Sub-
Adviser may aggregate sales and purchase orders with
respect to the assets of the Portfolios with similar
orders being made simultaneously for other accounts
advised by the Sub-Adviser or its affiliates. Whenever
the Sub-Adviser simultaneously places orders to
purchase or sell the same security on behalf of a
Portfolio and one or more other accounts advised by the
Sub-Adviser, the orders will be allocated as to price
and amount among all such accounts in a manner believed
to be equitable over time to each such account. The
Adviser recognizes that in some cases this procedure
may adversely affect the results obtained for such
Portfolio.
(c) The Sub-Adviser will maintain all books and
records required to be maintained by the Sub-Adviser
pursuant to the 1940 Act and the rules and regulations
promulgated thereunder with respect to transactions by
the Sub-Adviser on behalf of the Portfolios, and will
furnish the Board and the Adviser with such periodic
and special reports as the Board or the Adviser may
reasonably request. In compliance with the
requirements of Rule 31a-3 under the 1940 Act, the Sub-
Adviser hereby agrees that all records which it
maintains for the Portfolios are the property of the
Fund, agrees to preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act any records which it
maintains for the Fund and which are required to be
maintained by Rule 31a-1 under the 1940 Act, and
further agrees to surrender promptly to the Fund any
records which it maintains for the Portfolios upon
request by the Fund.
(d) At such times as shall be reasonably
requested by the Board or the Adviser, the Sub-Adviser
will provide the Board and the Adviser with economic
and investment analyses and reports as well as
quarterly reports setting forth the performance of the
Portfolios and make available to the Board and the
Adviser any economic, statistical and investment
services normally available to institutional or other
customers of the Sub-Adviser. Upon reasonable advance
notice, twice each calendar year the Sub-Adviser will
make its officers and employees available to meet with
the Board and employees of the Fund at the Fund's
principal place of business or another mutually agreed
upon location to review the securities of the
Portfolios.
(e) In accordance with procedures adopted by the
Board, as amended from time to time, the Sub-Adviser is
responsible for assisting in the fair valuation of all
securities constituting the Portfolios and will use its
reasonable efforts to arrange for the provision of a
price from a party or parties independent of the Sub-
Adviser for each security constituting part of a
Portfolio for which the Fund or the Fund's
administrator is unable to obtain prices in the
ordinary course of business from an automated pricing
service.
3. Further Duties. In all matters relating to
the performance of this Agreement, the Sub-Adviser will
act in conformity with the Fund's Articles of
Incorporation, By-laws and currently effective
registration statement under the 1940 Act and any
amendments or supplements thereto (the "Registration
Statement") and with the written instructions and
written directions of the Board and the Adviser and
will comply with the requirements of the 1940 Act, the
Investment Advisers Act of 1940, as amended (the
"Advisers Act"), the rules under each, Subchapter M of
the Internal Revenue Code of 1986 (the "Code") as
applicable to regulated investment companies, the
diversification requirements applicable to the
Portfolios under Section 817(h) of the Code and all
other applicable Federal and state laws and
regulations. The Adviser agrees to provide to the Sub-
Adviser copies of the Fund's Articles of Incorporation,
By-laws,
<PAGE>
Registration Statement, written instructions
and directions of the Board and the Adviser, and any
amendments or supplements to any of these materials as
soon as practicable after such materials become
available; provided, however, that the Sub-Adviser's
duty under this Agreement to act in conformity with any
document, instruction or guidelines produced by the
Fund or the Adviser shall not arise until it has been
delivered to the Sub-Adviser. In making any changes to
a Portfolio's objectives, policies or restrictions the
Board will make due allowance for the time within which
the Sub-Adviser shall have to bring such Portfolio into
compliance with such changes.
4. Proxies. The Sub-Adviser shall have the
power to vote all securities constituting a Portfolio
and shall not be required to seek or take instruction
from the Adviser or the Fund with respect to any such
vote.
5. Expenses. During the term of this Agreement,
the Sub-Adviser will bear all expenses incurred by it
in connection with its services under this Agreement
other than commissions, taxes, fees or other charges or
expenses directly related to the purchase, sale or
exchange of any securities for the Portfolios. The Sub-
Adviser shall not be responsible for any expenses
incurred by the Fund, the Portfolios or the Adviser.
6. Compensation. (a) For the services provided
by the Sub-Adviser with respect to a Portfolio pursuant
to this Agreement, the Adviser will pay to the Sub-
Adviser a fee, computed daily and payable monthly, at
an annual rate of (i) the fee percentage of such
Portfolio's average daily net assets (computed in the
manner specified in the Advisory Agreement) set forth
on the Exhibit relating to such Portfolio plus (ii)
0.10% of the average daily net assets of such Portfolio
attributable to investors in such Portfolio whose
initial investment in such Portfolio (other than
defined contribution or 401(k) plan investments) was
equal to or greater than $15,000,000, regardless of the
value of such investments following their initial
investment.
(b) The fee due the Sub-Advisor with respect to
each Portfolio shall be computed daily and shall be
paid monthly to the Sub-Adviser on or before the last
business day of the next succeeding calendar month.
Along with each such monthly payment the Adviser shall
provide the Sub-Adviser with a schedule showing the
manner in which such fee was computed.
(c) If during a Portfolio's first twelve months
of operation the Adviser waives any portion of the
management fee due to the Adviser pursuant to the terms
of the Advisory Agreement for the purpose of limiting
such Portfolio's total operating expenses to the
maximum expense percentage of such Portfolio's average
daily net assets for such period set forth on the
Exhibit relating to such Portfolio, and the resulting
net management fee received by the Adviser is less than
the compensation due to the Sub-Adviser pursuant to
subparagraph (a) above (the difference between such net
management fee and such compensation being hereinafter
referred to as the "Difference"), the Sub-Adviser shall
refund to the Adviser an amount equal to the
Difference; provided, however, that (i) the Sub-Adviser
shall not be required to refund to the Adviser an
amount greater than the fees paid by the Adviser to the
Sub-Adviser during such 12-month period; and (ii) such
Difference shall be reduced to the extent that in such
12-month period the net management fee received by the
Adviser with respect to all Portfolios exceeds the
compensation due to the Sub-Adviser with respect to
such Portfolios.
<PAGE>
(d) If this Agreement becomes effective or
terminates with respect to a Portfolio before the end
of any month, the fee relating to such Portfolio for
the period from the effective date with respect to such
Portfolio to the end of the 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.
7. Limitation of Liability. The Sub-Adviser
shall not be liable for any error of judgment or
mistake of law or for any loss suffered by any
Portfolio, the Fund or its shareholders or by the
Adviser in connection with the matters to which this
Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part
in the performance of its duties or from reckless
disregard by it of its obligations and duties under
this Agreement.
8. Representations of Sub-Adviser. The Sub-
Adviser represents, warrants and agrees as follows:
(a) The Sub-Adviser (i) is registered as an Investment
Adviser under the Advisers Act and will continue to be
so registered for so long as this Agreement remains in
effect; (ii) is not prohibited by the 1940 Act or the
Advisers Act from performing the services contemplated
by this Agreement; (iii) has met, and will seek to
continue to meet for so long as this Agreement remains
in effect, any other applicable Federal or state
requirements, or the applicable requirements of any
regulatory or industry self-regulatory agency,
necessary to be met in order to perform the services
contemplated by this Agreement; (iv) has the authority
to enter into and perform the services contemplated by
this Agreement; and (v) will promptly notify the
Adviser of the occurrence of any event that would
disqualify the Sub-Adviser from serving as an
investment adviser of an investment company pursuant to
Section 9(a) of the 1940 Act or otherwise.
(b) The Sub-Adviser has adopted a written code of
ethics complying with the requirements of Rule 17j-1
under the 1940 Act and will provide the Adviser and the
Board with a copy of such code of ethics, together with
evidence of its adoption. Within 15 calendar days of
the end of the last calendar quarter of each year that
this Agreement is in effect, the President of the Sub-
Adviser shall certify to the Adviser that the Sub-
Adviser has complied with the requirements of Rule 17j-
1 during the previous year and that there has been no
violation of the Sub-Adviser's code of ethics or, if
such a violation has occurred, that appropriate action
was taken in response to such violation. Upon the
written request of the Adviser, the Sub-Adviser shall
permit the Adviser, its employees or its agents to
examine the reports required to be made to the Sub-
Adviser by Rule 17j-1(c)(1) and all other records
relevant to the Sub-Adviser's code of ethics.
(c) The Sub-Adviser has provided the Adviser with
a copy of its Form ADV as most recently filed with the
Securities and Exchange Commission (the "SEC") and
promptly will furnish a copy of all amendments to the
Adviser at least annually.
9. Trademark. The Sub-Adviser shall have no
rights relating to the name of the Fund or the word
"Frontegra" used in connection with investment
products, services or otherwise, and shall make no use
of such names without the express written consent of
the Fund or Adviser, as the case may be.
10. Services Not Exclusive. The Sub-Adviser may
act as an investment adviser to any other person, firm
or corporation, excluding any registered investment
company, and may
<PAGE>
perform management and any other
services for any other person, association,
corporation, firm or other entity, excluding any
registered investment company, pursuant to any contract
or otherwise, and take any action or do anything in
connection therewith or related thereto, except as
prohibited by applicable law; and no such performance
of management or other services or taking of any such
action or doing of any such thing shall be in any
manner restricted or otherwise affected by any aspect
of any relationship of the Sub-Adviser to or with the
Fund, the Portfolios or the Adviser or deemed to
violate or give rise to any duty or obligation of the
Sub-Adviser to the Fund, the Portfolios or the Adviser
except as otherwise imposed by law or by this
Agreement.
11. Duration and Termination. (a) This Agreement
shall become effective with respect to a Portfolio upon
the date of execution of the Exhibit relating to such
Portfolio; provided that this Agreement shall not take
effect unless it has first been approved (i) by a vote
of a majority of those members of the Board who are not
parties to this Agreement or interested persons of the
Adviser, the Sub-Adviser or the Fund, cast in person at
a meeting called for the purpose of voting on such
approval, and (ii) by vote of a majority of the
outstanding voting securities issued by such Portfolio.
(b) Unless sooner terminated with respect to a
Portfolio as provided herein, this Agreement shall
continue in effect for two years from its effective
date. Thereafter, if not terminated, this Agreement
shall continue automatically for successive periods of
12 months each, provided that such continuance is
specifically approved at least annually (i) by a vote
of a majority of those members of the Board who are not
parties to this Agreement or interested persons of the
Adviser, the Sub-Adviser or the Fund, cast in person at
a meeting called for the purpose of voting on such
approval, and (ii) by the Board or by vote of a
majority of the outstanding voting securities issued by
such Portfolio.
(c) Notwithstanding the foregoing, this Agreement
may be terminated with respect to a Portfolio at any
time, without the payment of any penalty, by vote of
the Board or by a vote of a majority of the outstanding
voting securities issued by such Portfolio upon 60
calendar days written notice to the Sub-Adviser. This
Agreement may also be terminated, without the payment
of any penalty, by either party hereto upon 180
calendar days written notice. This Agreement will
terminate automatically in the event of its assignment
or upon termination of the Advisory Agreement.
12. Amendment. No provision of this Agreement
may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by
the party against which enforcement of the change,
waiver, discharge or termination is sought. No
amendment of this Agreement with respect to a Portfolio
shall be effective until approved (a) by a vote of a
majority of those members of the Board who are not
parties to this Agreement or interested persons of the
Adviser, the Sub-Adviser or the Fund, and (b) if
required by the 1940 Act, by a vote of a majority of
the outstanding voting securities issued by such
Portfolio (in the case of (b), the Fund may rely upon
an SEC order or no-action letter permitting it to
modify this Agreement without such vote).
13. Governing Law. This Agreement shall be
construed in accordance with the 1940 Act and the laws
of the State of Indiana, without giving effect to the
conflicts of laws principles
<PAGE>
thereof. To the extent
that the applicable laws of the State of Indiana
conflict with the applicable provisions of the 1940
Act, the latter shall control.
14. Independent Contractor. In performing its
duties under this Agreement the Sub-Adviser shall act
as an independent contractor and unless otherwise
expressly provided herein or authorized in writing, the
Sub-Adviser will have no authority to represent the
Fund, the Portfolios or the Adviser in any way or
otherwise be deemed an agent of the Fund, the Portfolio
or the Adviser.
15. Miscellaneous. The captions in this
Agreement are included for convenience of reference
only and in no way define or delimit any of the
provisions hereof or otherwise affect their
construction or effect. If any provision of this
Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby. This
Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective
successors. As used in this Agreement, the terms
"majority of the outstanding voting securities,"
"affiliated person," "interested person," "assignment,"
"broker," "investment adviser," "net assets," "sale,"
"sell" and "security" shall have the same meaning as
such terms have in the 1940 Act, subject to such
exemption as may be granted by the SEC by any rule,
regulation or order. Where the effect of a requirement
of the Federal securities laws reflected in any
provision of this Agreement is made less restrictive by
a rule, regulation or order of the SEC, whether of
special or general application, such provision shall be
deemed to incorporate the effect of such rule,
regulation or order. This Agreement may be signed in
counterpart.
16. Notices. Any written notice herein required
to be given to the Sub-Adviser or the Adviser shall be
deemed to have been given upon receipt of the same at
their respective addresses set forth below.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have
caused this instrument to be executed by their duly
authorized signatories as of the date and year first
above written.
FRONTEGRA ASSET MANAGEMENT, INC.
400 Skokie Boulevard
Suite 500
Northbrook, Illinois 60062
By: ________________________________________
Name:
Title:
Attest:
_______________________
REAMS ASSET MANAGEMENT COMPANY, LLC
227 Washington Street
Columbus, Indiana 47201
By: ________________________________________
Name:
Title:
Attest:
______________________
<PAGE>
Exhibit A
to the Sub-Advisory Agreement
FRONTEGRA OPPORTUNITY FUND
Fee percentage: 0.45%
Executed as of the 2nd day of August, 1999.
FRONTEGRA ASSET MANAGEMENT, INC.
By: ___________________________________
Name:
Title:
REAMS ASSET MANAGEMENT COMPANY, LLC
By: ___________________________________
Name:
Title:
<PAGE>
Exhibit B
to the Sub-Advisory Agreement
FRONTEGRA TOTAL RETURN BOND FUND
Fee percentage: 0.20%
Executed as of the 2nd day of August, 1999.
FRONTEGRA ASSET MANAGEMENT, INC.
By: __________________________________
Name:
Title:
REAMS ASSET MANAGEMENT COMPANY, LLC
By: __________________________________
Name:
Title:
<PAGE>
FRONTEGRA TOTAL RETURN BOND FUND
FRONTEGRA OPPORTUNITY FUND
Each, a Series of
FRONTEGRA FUNDS, INC.
JOINT PROXY FOR SPECIAL MEETING OF SHAREHOLDERS
The undersigned hereby revokes all previous
proxies and constitutes and appoints William D.
Forsyth, III and Thomas J. Holmberg, Jr. as proxies,
each with power to appoint his substitute, and hereby
authorizes them to represent and to vote by majority,
as designated below, all shares of stock of the Fund
which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the Frontegra Total
Return Bond Fund and the Frontegra Opportunity Fund to
be held at 400 Skokie Boulevard, Suite 500, Northbrook,
Illinois 60062 on July 28, 1999, at 10:00 a.m., local
time, and any adjournments thereof, with respect to the
matters set forth below and described in the Notice of
Special Meeting and Proxy Statement dated July 9, 1999,
receipt of which is hereby acknowledged.
DATE:
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.
_____________________________________
Signature(s)(Title(s), if applicable)
This proxy will be voted as specified. IF NO
SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED IN
FAVOR OF PROPOSAL 1 AND IN THE DISCRETION OF THE
PROXIES AS TO ITEM 2. Please indicate by filling in
the appropriate box below.
1. To approve the new sub-advisory agreement FOR AGAINST ABSTAIN
between Frontegra Asset Management Inc. [] [] []
and Reams Asset Management Company, LLC.
2. To vote upon any other matters which may FOR AGAINST ABSTAIN
legally come before the meeting. [] [] []
WE NEED YOUR VOTE BEFORE JULY 28, 1999
Your vote is important. If you are unable to
attend the Meeting in person, we urge you to complete,
sign, date and return this proxy card using the
enclosed postage prepaid envelope. Your prompt return
of the proxy will help assure a quorum at the Meeting
and avoid additional expenses associated with further
solicitation. Sending in your proxy will not prevent
you from personally voting your shares at the Meeting
and you may revoke your proxy by advising the Secretary
of the Company in writing (by subsequent proxy or
otherwise) of such revocation at any time before it is
voted.
THANK YOU FOR YOUR TIME
