As filed with the Securities and Exchange Commission on December 14, 1998
File Nos.: 811-07959
333-42505
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
PRE-EFFECTIVE AMENDMENT NO. 1
ADVISORS SERIES TRUST
(Exact Name of Registrant as Specified in Charter)
(602) 952-1100
(Registrant's Telephone Number, Including Area Code)
4455 E. Camelback Road, Suite 261E
Phoenix, AZ 85018
(Address of Principal Executive Offices)
------------------
ROBERT H. WADSWORTH
Advisors Series Trust
4455 E. Camelback Road, Suite 261E
Phoenix, AZ 85018
(Name and Address of Agent for Service)
-------------------
Copy to:
Julie Allecta, Esq.
Kelvin Leung, Esq.
Paul, Hastings, Janofsky & Walker LLP
345 California Street
San Francisco, California 94104
Approximate Date of Proposed Public Offering: As soon as practicable after this
Registration Statement becomes effective. It is proposed that this filing will
become effective on January 11, 1999 but in no event later than January 22, 1999
pursuant to Rule 488.
No filing fee is required under the 1933 Act because an indefinite number of
shares of beneficial interest, with par value $0.01 per share, has previously
been registered pursuant to Rule 24f-2 under the Investment Company Act of 1940.
SF:58206.2
<PAGE>
CROSS REFERENCE SHEET
Form N-14 Part A, Item Location in Prospectus/Proxy Statement
1 Front Cover; Cross Reference
2 Table of Contents
3 Introduction; Description of the Proposed
Reorganization; Comparison of the Funds; Risk
Factors
4 Introduction, The Transaction, The Proposal,
Description of the Proposed Reorganization
5, 6 The Transaction, Comparison of the Funds; Risk
Factors; Further Information About the Fund and the
New Fund
7 Shares and Voting; Vote Required
8 Not Applicable
9
Form N-14 Part B, Item Location in Statement of Additional Information
10 Cover Page
11 Table of Contents
12 Incorporation of Documents by Reference in
Statement of Additional Information
13 Not Applicable
14 Incorporation of Documents by Reference in
Statement of Additional Information
Form N-14 Part C
Information required to be included in Part C is set forth under the appropriate
item, so numbered, in Part C of Form N-14.
SF:58206.2
<PAGE>
THE FOLLOWING ITEMS ARE HEREBY INCORPORATED BY REFERENCE:
From Post-Effective Amendment No. 30 of Advisors Series Trust, filed October 15,
1998 (SEC File No. 33-17391) and scheduled to become effective on December 29,
1998:
Preliminary Prospectus for SB&H Mid Cap Fund, dated ____________, 1998
Preliminary Statement of Additional Information for SB&H Mid Cap Fund,
dated _________________, 1998
From Post-Effective Amendment No. 31 of VAM Institutional Funds, Inc., filed
August 27, 1998 (SEC File No. 2-95930):
Prospectus for Segall Bryant & Hamill Growth and Income Fund, dated
August 27, 1998
Statement of Additional Information for Segall Bryant & Hamill Growth
and Income Fund, dated August 27, 1998
As previously sent to shareholders of the Segall Bryant & Hamill Growth and
Income Fund and filed with the SEC pursuant to Rule 30b2-1:
Annual Report for the Segall Bryant & Hamill Growth and Income Fund for
the fiscal year ended April 30, 1998.
SF:58206.2
<PAGE>
PART A
SF:58206.2
<PAGE>
VAM INSTITUTIONAL FUNDS, INC.
90 South Seventh Street
Suite 4300
Minneapolis, MN 55402
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
OF
SEGALL BRYANT & HAMILL GROWTH AND INCOME FUND
TO BE HELD JANUARY 29, 1999
To the Shareholders of
Segall Bryant & Hamill Growth and Income Fund:
NOTICE IS HEREBY GIVEN that a special meeting (the "Meeting")
of shareholders of Segall Bryant & Hamill Growth and Income Fund (the "Fund"), a
series of VAM Institutional Funds, Inc., will be held at the offices of the
Fund, 90 South Seventh Street, Suite 4400, Minneapolis, MN 55402 on January 29,
1999, at 10:00 a.m., local time, for the following purposes:
1. To approve or disapprove a proposed reorganization of the Fund
into the SB&H Mid Cap Fund, a newly formed series of Advisors
Series Trust.
2. To transact such other business as may properly come before
the Meeting or any adjournment(s) thereof.
Only shareholders of record at the close of business on
December 21, 1998 (the "Record Date"), will be entitled to notice of and to vote
at the Meeting or any adjournment thereof.
By Order of the Board of Directors
----------------------------
Thomas J. Abood, Secretary
January __, 1999
YOUR VOTE IS IMPORTANT REGARDLESS OF HOW MANY
SHARES YOU OWNED ON THE RECORD DATE.
--------------------
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY FORM, DATE AND
SIGN IT, AND RETURN IT IN THE PRE-ADDRESSED ENVELOPE PROVIDED. NO POSTAGE IS
NECESSARY IF MAILED IN THE UNITED STATES. IN ORDER TO AVOID THE ADDITIONAL
EXPENSE OF FURTHER SOLICITATION, WE REQUEST YOUR COOPERATION IN MAILING YOUR
PROXY PROMPTLY.
SF:58206.2
<PAGE>
VAM INSTITUTIONAL FUNDS, INC.
Segall Bryant & Hamill Growth and Income Fund
and
ADVISORS SERIES TRUST
SB&H Mid Cap Fund
COMBINED PROXY STATEMENT AND PROSPECTUS
--------------------------
DATED: January __, 1999
This document, which includes a Notice of Special Meeting of
Shareholders, a Combined Proxy Statement and Prospectus and a form of Proxy, is
being furnished in connection with the solicitation of proxies by the Board of
Directors (the "Board of Directors") of VAM Institutional Funds, Inc. ("VAM
Funds") for use at the Special Meeting (the "Meeting") of Shareholders of the
Segall Bryant & Hamill Growth and Income Fund (the "Fund"), a separate series of
VAM Funds, to be held on January 29, 1999.
At the Meeting, the shareholders of the Fund will be asked to vote on
the approval or disapproval of a proposed reorganization (the "Reorganization")
of the Fund into SB&H Mid Cap Fund (the "New Fund"), a series of Advisors Series
Trust ("AST Trust"). The Reorganization will include: (i) the transfer of all of
the assets and liabilities of the Fund to the New Fund in exchange for shares of
the New Fund (the "New Fund Shares") of equivalent value to the assets and
liabilities transferred, (ii) the pro rata distribution of such New Fund Shares
to shareholders of record of the Fund as of the effective date of the
Reorganization (the "Effective Date") in full redemption of such shareholders'
shares in the Fund, and (iii) the immediate liquidation and termination of the
Fund. As a result of the Reorganization, each shareholder of the Fund as of the
Effective Date will hold New Fund Shares having the same aggregate net asset
value as the shares of the Fund held by such shareholder immediately before
consummation of the Reorganization. Counsel to the New Fund will issue an
opinion to the effect that for federal income tax purposes, the Reorganization
will be treated as a tax-free reorganization that will not cause the Fund's
shareholders to recognize a gain or loss for federal income tax purposes. See
Section II.A.3 below.
The principal executive offices of VAM Funds are located at 90 South
Street, Suite 4300, Minneapolis, MN 55402 (telephone: 612-376-7000). The
principal executive offices of AST Trust are located at 4455 E. Camelback Road,
Suite 261E, Phoenix, Arizona 85018 (telephone:
602-952-1100).
This Combined Proxy Statement and Prospectus sets forth concisely the
information that a shareholder of the Fund should know before voting on the
proposal. It should be read and retained for future reference.
The New Fund is a new series of AST Trust. The registration statement
for the New
SF:58206.2
1
<PAGE>
Fund (which includes the Preliminary Prospectus and the Preliminary Statement of
Additional Information for the New Fund) was initially filed with the Securities
and Exchange Commission (the "SEC") on October 15, 1998 and is scheduled to
become effective on December 29, 1998 and incorporated by reference herein. The
Prospectus and Statement of Additional Information for the Fund dated August 27,
1998 and the Statement of Additional Information relating to this Combined Proxy
Statement and Prospectus of even date herewith are on file with the SEC and are
incorporated by reference herein. The Fund's Prospectus dated August 27, 1998
and the New Fund's preliminary Prospectus dated as of __________, 1998 accompany
this document. The Statement of Additional Information of the Fund dated August
27, 1998 and the Statement of Additional Information relating to this Combined
Proxy Statement and Prospectus of even date herewith, are available without
charge by writing to the VAM Funds at 90 South Seventh Street, Suite 4300,
Minneapolis, MN 55402, or by calling 612-376-7000.
The Annual Report to Shareholders of the Fund for the fiscal year ended
April 30, 1998, containing audited financial statements of the Fund previously
has been mailed to each shareholder entitled to vote at the Meeting. Additional
copies of that Annual Report are available without charge by writing or calling
the VAM Funds at its address and telephone number listed above. The New Fund is
a new series of AST Trust and has not commenced operations. Therefore, no Annual
Report to Shareholders of the New Fund is available. It is expected that this
Combined Proxy Statement and Prospectus will be mailed to shareholders on or
about January __, 1999.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
SF:58206.2
2
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
I. INTRODUCTION
<S> <C>
A. THE TRANSACTION.........................................................................
B. THE PROPOSAL............................................................................
C. SHARES AND VOTING.......................................................................
II. THE PROPOSAL:
APPROVAL OF THE PROPOSED REORGANIZATION..........................................................
A. DESCRIPTION OF THE PROPOSED REORGANIZATION..............................................
1. The Reorganization.............................................................
2. Effect of the Reorganization...................................................
3. Federal Income Tax Consequences................................................
4. Description of the New Fund Shares.............................................
5. Capitalization.................................................................
B. COMPARISON OF THE FUNDS.................................................................
1. New Investment Objectives and Policies.........................................
2. Investment Restrictions........................................................
3. Comparative Summary of Investor Costs..........................................
4. Comparative Performance Information............................................
5. Advisory Fees, Sub-Advisory Fees and Other Expenses............................
6. Distribution and Shareholder Services..........................................
7. Distribution Plans.............................................................
8. Administration, Custody, Fund Accounting and Transfer Agency
Services.......................................................................
9. Purchase Procedures............................................................
10. Redemption Procedures..........................................................
11. Income Dividends, Capital Gain Distributions and Taxes.........................
12. Portfolio Transactions and Brokerage Commissions...............................
13. Shareholders' Rights...........................................................
C. RISK FACTORS............................................................................
D. RECOMMENDATION OF THE BOARD OF DIRECTORS................................................
1. The Legal Framework............................................................
2. The Director' Considerations...................................................
E. DISSENTERS' RIGHTS OF APPRAISAL.........................................................
F. FURTHER INFORMATION ABOUT THE FUND AND THE
New Fund................................................................................
G. VOTE REQUIRED...........................................................................
III. MISCELLANEOUS ISSUES.............................................................................
A. OTHER BUSINESS..........................................................................
B. NEXT MEETING OF SHAREHOLDERS............................................................
C. EXPERTS.................................................................................
SF:58206.2
3
</TABLE>
<PAGE>
I. INTRODUCTION
A. THE TRANSACTION
The Meeting has been called for the purpose of allowing shareholders of
the Fund to consider and vote on a proposed reorganization of the Fund (the
"Reorganization"). The purpose of the Reorganization is to spin the Fund out of
the VAM Funds prior to the impending liquidation of the VAM Funds and to
continue the Fund, with more of a mid-cap emphasis, as a separate mutual fund to
be called the SB&H Mid Cap Fund (as defined above, the "New Fund"), which will
be a series of AST Trust. This reorganization is necessitated by the decision of
the Board of Directors of VAM Funds to dissolve and liquidate all the VAM Funds,
including the Growth & Income Fund managed by Segall Bryant & Hamill ("SB&H").
If the Fund were simply liquidated along with the other VAM funds, distributions
of Fund assets would likely result in current taxation of any built-in gains for
shareholders who are not investing through a tax-exempt or tax-deferred account.
If the proposed Reorganization is approved, the Fund would continue to operate
in the form of the New Fund and there would be no adverse tax consequences for
shareholders. SB&H, the Fund's portfolio adviser since inception, would continue
to be directly responsible for the New Fund and has agreed to keep the operating
expenses of the New Fund at below their current level. SB&H and the Directors of
the VAM Funds believe it will be in the shareholders' best interests to have the
Fund continue in existence.
The current investment objective of the Fund is to seek growth of
capital with income as a secondary objective. The Fund seeks to achieve its
objective by investing primarily in the equity securities of well-established
U.S. companies which, in the opinion of the Fund's sub-advisor, offer income
potential in addition to growth of capital. The New Fund has an identical
investment objective as the Fund, except that the New Fund will focus its
investments in the equity securities of mid cap companies. Mid cap companies are
those whose market capitalization falls within the range of $300 million to $10
billion at the time of the New Fund's investment. The total expenses for the New
Fund are projected to be lower than the current total expenses of the Fund
because SB&H has agreed to limit the New Fund's total expenses to 1.40% of the
New Fund's average daily net assets. Also, SB&H expects that with an increased
marketing effort, the total assets of the New Fund may increase over time,
thereby spreading fixed costs over an even larger asset base and reducing the
New Fund's per share fixed operating expenses. Of course, there can be no
guarantee that the total expenses of the New Fund will be reduced as a result of
the Reorganization or that the investment objective of either Fund will be
achieved.
In light of the foregoing considerations and the other considerations
described in this document, the Board of Directors of the VAM Funds have
considered and approved the Reorganization of the Fund into a newly created
portfolio of AST Trust. AST Trust is a Delaware business trust organized on
October 3, 1996, with sixteen effective series. The AST Trust specializes in
providing the necessary structure for adviser-sponsored mutual funds like the
Fund and has all the necessary service providers in place and would be in a
position to service the New Fund and its shareholders without interruption as
soon as practicable following the Reorganization. Giving effect to a commitment
by the New Fund's investment advisor, SB&H,
SF:58206.2
4
<PAGE>
to waive fees payable to it and/or reimburse expenses to keep the New Fund's
total expense ratio to no more than 1.40% annually, the New Fund will have a
lower expense ratio than the Fund from the consummation of the Reorganization
(which is expected to occur in February 1999). SB&H may, in the future, reduce
or eliminate such waiver and reimbursement however. The Reorganization will be
accomplished by transferring all of the assets and liabilities of the Fund to a
new series (called "SB&H Mid Cap Fund" or the "New Fund") of AST Trust with the
result that the existing shareholders of the Fund will become, after the
Reorganization, the shareholders of the New Fund. The net asset value per share
of the New Fund and the number of shares owned by each New Fund shareholder will
be the same on the date of the Reorganization as the net asset value per share
of the Fund and the number of shares owned on that date by the Fund's
shareholders.
The cost of the Reorganization and of the Meeting and solicitation of
proxies therefor, including the cost of copying, printing and mailing of proxy
materials, will be borne by the Fund. The total cost is currently estimated to
be $2,000. In addition to solicitations by mail, proxies may also be solicited
by officers of the VAM Funds, the AST Trust or SB&H, without special
compensation, by telephone, telegram or otherwise.
B. THE PROPOSAL
At the Meeting, the shareholders of the Fund will be asked to approve
the proposed Reorganization of the Fund into the New Fund. The Reorganization
will include the transfer of all of the assets and liabilities of the Fund to
the New Fund in exchange for shares of the New Fund of equivalent value, the pro
rata distribution of such New Fund Shares to the shareholders of the Fund in
full redemption of such shareholders' shares in the Fund, and the immediate
liquidation and termination of the Fund.
The Fund and the New Fund (collectively, the "Funds") have identical
investment objectives and similar investment policies (see "Comparison of the
Funds-Investment Objectives and Policies," below). The investment objective of
the Fund is to seek growth of capital with income as a secondary objective, by
investing primarily in the equity securities of well-established companies
(i.e., companies with market capitalizations in excess of $1 billion). The New
Fund has an identical investment objective but it seeks to achieve its objective
by investing primarily in the equity securities of medium capitalization
companies (i.e., companies with market capitalization of between $300 million
and $10 billion at the time of the New Fund's investment).
Investments in the Funds are subject to substantially similar risks.
See Section II.C. below.
The purchase and redemption arrangements of the Funds are substantially
identical. The New Fund and the Fund have different distribution arrangements
which are more fully discussed in Section II.B. below.
The investment advisor to the Fund is Voyageur Asset Management LLC
("VAM LLC")
SF:58206.2
5
<PAGE>
and the sub-advisor to the Fund is SB&H. SB&H will serve as investment advisor
to the New Fund, which does not have a sub-adviser. As discussed below, the
Board of Directors of the VAM Funds believes that the proposed Reorganization is
in the best interests of the Fund and its shareholders, and that the interests
of existing shareholders of the Fund will not be diluted as a result of the
proposed Reorganization. See Section II.D. below.
C. SHARES AND VOTING
The VAM Funds are a Minnesota corporation registered with the SEC as an
open-end management investment company. The VAM Funds currently have four
series, or funds, outstanding, including the Fund. None of these other series
are currently engaging in investment operations and it is the intention of the
Board of Directors to liquidate VAM Funds following the Reorganization.
Currently, the Fund only offers Class A shares of the Fund for sale. The New
Fund has designated only one class of shares. The Fund's shareholders will
receive shares of the New Fund in exchange for their Fund shares if the
Reorganization is approved and consummated. Similar to the structure of the
Fund, the New Fund will have a plan of distribution pursuant to Rule 12b-1 as
promulgated under the Investment Company Act of 1940 (the "1940 Act").
Each share of the Fund, or fraction thereof, is entitled to one vote or
corresponding fraction thereof at the Meeting. At the close of business on
December 21, 1998 (the "Record Date"), the record date for the determination of
shareholders entitled to vote at the Meeting, there were _________________
shares outstanding held by _____ record holders (including omnibus accounts
representing multiple underlying beneficial owners).
All shares represented by each properly signed or transmitted proxy
received prior to the Meeting will be voted at the Meeting. If a shareholder
specifies how the proxy is to be voted on any business properly to come before
the Meeting, it will be voted in accordance with such instruction. A proxy may
be revoked by a shareholder at any time prior to its use by written notice to
the VAM Funds, by submission of a later-dated proxy or by voting in person at
the Meeting. If any other matters come before the Meeting, proxies will be voted
by the persons named therein as proxies in accordance with such persons' best
judgment.
The holders of ten percent of the shares outstanding and entitled to
vote shall in person or by proxy constitute a quorum. When a quorum is present,
approval of the proposal will require the affirmative vote of the lesser of (i)
67% of the shares represented at the Meeting if more than 50% of the outstanding
shares is represented, or (ii) shares representing more than 50% of the Fund's
outstanding shares. The Meeting may be adjourned from time to time by a majority
of the votes properly cast upon the question of adjourning the Meeting to
another date and time, whether or not a quorum is present, and the Meeting may
be held as adjourned without further notice. The persons named in the proxy will
vote in favor of such adjournment those shares which they are entitled to vote
if such adjournment is necessary to obtain a quorum or to obtain a favorable
vote on any proposal.
For purposes of determining the presence of a quorum for transacting
business at the
SF:58206.2
6
<PAGE>
Meeting, abstentions and broker "non-votes" (that is, proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as shares that are present. However, broker non-votes are
disregarded in determining "votes cast" when the voting requirement is based on
achieving a percentage of the voting securities entitled to vote present in
person or by proxy at the Meeting.
As of the Record Date, the Fund's shareholders of record and (to the
VAM Fund's knowledge) beneficial owners who owned more than five percent of the
Fund's shares are as follows:
<TABLE>
<CAPTION>
Shareholder Percentage of the Fund's
Outstanding Shares
<S> <C>
- - --------------------------------------- ---------------------------------------------
--------- -------------
</TABLE>
The New Fund currently does not have any public shareholders.
Currently, First Fund Distributors, Inc. holds all the outstanding shares of the
New Fund.
The officers and Directors of the VAM Funds, as a group, owned of
record and beneficially less than one percent of the outstanding voting
securities of the Fund as of the Record Date.
II. THE PROPOSAL:
APPROVAL OF THE PROPOSED REORGANIZATION
A. DESCRIPTION OF THE PROPOSED REORGANIZATION
1. The Reorganization
If the Reorganization is approved, on the Effective Date the New Fund
will acquire the assets and liabilities of the Fund, and will issue to the Fund
the number of New Fund Shares determined by dividing the value of the Fund's
assets and liabilities so transferred by the net asset value of one New Fund
Share. The assets and liabilities of the Fund and the net asset value of the New
Fund will be calculated at the close of business on the date immediately
preceding the Effective Date (the "Valuation Date") in accordance with the
Funds' valuation procedures described in their respective Prospectuses (in the
case of the New Fund, the Prospectus on file with the SEC, and, in the case of
the Fund, the Prospectus dated August 27, 1998). Contemporaneously with that
asset transfer, the Fund will distribute the New Fund Shares it receives pro
rata to each remaining shareholder of the Fund based on the percentage of the
SF:58206.2
7
<PAGE>
outstanding shares of the Fund held of record by that shareholder on the
Valuation Date.
This distribution of the New Fund Shares by the Fund to its
shareholders in full redemption of such shareholders' Fund shares will be
accomplished by the establishment of book accounts on the New Fund's share
records in the name of the respective shareholders of the Fund, representing the
respective pro rata number of New Fund Shares deliverable to the Fund
shareholders. Fractional shares will be carried to the third decimal place.
Certificates evidencing the New Fund Shares will not be issued to the Fund's
shareholders.
Immediately following the Fund's pro rata liquidating distribution of
the New Fund Shares to the Fund shareholders, the Fund and VAM Funds will
liquidate and terminate.
Consummation of the Reorganization is subject to approval by the
shareholders of the Fund and the satisfaction of certain other conditions. The
Reorganization may be abandoned at any time before the Effective Date upon the
vote of either a majority of the Board of Directors of the VAM Funds or a
majority of the Board of Trustees of AST Trust.
The above is a summary of the Reorganization. The summary does not
purport to be a complete description of the terms of the Reorganization, which
are set forth in the Agreement and Plan of Reorganization attached as Exhibit A
to this document.
2. Effect of the Reorganization
If the Reorganization is approved and completed, shareholders of the
Fund as of the Effective Date will become shareholders of the New Fund, which
will acquire the net assets of the Fund. The net asset value of the New Fund
Shares held by each shareholder of the Fund immediately after consummation of
the Reorganization will be equivalent to the net asset value of the Fund shares
held by that shareholder immediately before consummation of the Reorganization.
On or before the Effective Date the Fund intends to distribute all of
its then remaining net investment income and realized capital gains.
SB&H, the current sub-adviser to the Fund, will, after the
Reorganization, be the investment adviser for the New Fund and therefore will be
the investment adviser for the Fund's assets after the Reorganization. The
current adviser of the Fund -- VAM LLC -- will cease to have any relationship
with the operation of the Fund (in its reconstituted form as the New Fund).
Also, after the Reorganization, First Fund Distributors, Inc. will be
distributor of the New Fund's shares instead of Dougherty Summit Securities LLC,
the distributor of shares of the Fund. The current Board of Director of VAM
Funds will no longer serve in that capacity. It is, however, expected that the
New Fund will be managed in accordance with its existing investment objective
and policies, which are similar to that of the Fund, other than a change of
investment universe to mid cap companies.
3. Federal Income Tax Consequences
SF:58206.2
8
<PAGE>
As a condition to the closing of the Reorganization, the Fund and the
New Fund must receive a favorable opinion from Paul, Hastings, Janofsky & Walker
LLP, counsel to the New Fund, substantially to the effect that, for federal
income tax purposes: (a) the transfer by the Fund of substantially all of its
assets to the New Fund solely in exchange for the New Fund Shares, as described
above, is a reorganization within the meaning of Section 368(a)(1)(D) of the
Internal Revenue Code of 1986 (the "Code"); (b) no gain or loss is recognized by
the Fund upon the transfer of substantially all of its assets to the New Fund in
exchange solely for shares of the New Fund Shares; (c) no gain or loss is
recognized by the New Fund on receipt of the Fund assets in exchange for the New
Fund Shares; (d) the basis of the assets of the Fund in the hands of the New
Fund is, in each instance, the same as the basis of those assets in the hands of
the Fund immediately prior to the transaction; (e) the holding period of the
Fund's assets in the hands of the New Fund includes the period during which the
assets were held by the Fund; (f) no gain or loss is recognized to the
shareholders of the Fund upon the receipt of the New Fund Shares solely in
exchange for the Fund's shares; (g) the basis of the New Fund Shares received by
the Fund shareholders is, in each instance, the same as the basis of the Fund
shares surrendered in exchange therefor; and (h) the holding period of the New
Fund Shares received by the Fund shareholders includes the holding period during
which shares of the Fund surrendered and exchanged therefor was held, provided
that such shares were held as a capital asset in the hands of the Fund
shareholders on the date of the exchange. The VAM Funds do not intend to seek a
private letter ruling from the Internal Revenue Service with respect to the tax
effects of the Reorganization.
4. Description of the New Fund Shares
Each New Fund Share issued to Fund shareholders pursuant to the
Reorganization will be duly authorized, validly issued, fully paid and
nonassessable when issued, will be transferable without restriction and will
have no preemptive or conversion rights. Each New Fund Share will represent an
equal interest in the assets of the New Fund. The New Fund Shares will be sold
and redeemed based upon the net asset value of the New Fund next determined
after receipt of the purchase or redemption request, as described in the New
Fund's Prospectus.
5. Capitalization
The capitalization of the Funds as of October 31, 1998, and their pro
forma combined capitalization as of that date after giving effect to the
proposed Reorganization are as follows:
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
New Acquired Pro Forma
Fund Fund Combined
------------------- -------------------- -------------------
<S> <C> <C> <C>
Aggregate net assets..................... $0** $6,953,093 $6,953,093
Shares outstanding*...................... $0** $531,394.837 $531,394.837
SF:58206.2
9
<PAGE>
Net asset value per share................ $0** $13.08 $13.08
- - -----------------------------------------
* Each Fund is authorized to issue an indefinite number of shares.
** The New Fund is a new series of AST Trust. It has not commenced operation and
currently has no assets and no shares outstanding.
</TABLE>
SF:58206.2
10
<PAGE>
B. COMPARISON OF THE FUNDS
A brief comparison of the Funds is set forth below.
1. Name, Investment Objectives and Policies
Effective with the Reorganization, the Fund's name, Segall Bryant and
Hamill Growth & Income Fund, would change to that of the New Fund, SB&H Mid Cap
Fund. The investment objective of the Fund is to seek growth of capital with
income as a secondary objective, by investing primarily in the equity securities
of well-established companies (i.e., companies having a market capitalization in
excess of $1 billion). The investment objective of the New Fund is identical.
However, the New Fund will seek to achieve its investment objective by investing
primarily in the equity securities of medium capitalization companies (i.e.,
companies whose market capitalization falls within the range of $300 million to
$10 billion).
The Fund invests primarily (at least 65% of its total assets) in common
stocks and other securities convertible into common stock (including preferred
stocks and debentures). The Fund may also invest up to 35% of its total assets
in debt securities. Under normal market conditions, at least 65% of the value of
the Fund's total assets will be invested in the equity securities of companies
having a market capitalization in excess of $1 billion. The Fund may also invest
in securities of foreign issuers in the form of American Depositary Receipts and
Global Depositary Receipts.
The New Fund has an identical investment objective and policies as the
Fund, except that the New Fund will invest primarily (at least 65% of its total
assets) in equity securities of medium capitalization companies. Medium
capitalization companies are those whose market capitalization falls within the
range of $300 million to $10 billion at the time of the New Fund's investment.
In addition, the Fund is permitted to make short sales against the box, whereas
the New Fund is permitted to make short shares which are not against the box. A
short sale which is not against the box occurs when the New Fund sell securities
short by borrowing securities it does not own and selling them. The New Fund
would then be obligated to replace the securities borrowed by purchasing them at
the market price at the time of replacement. See Section II.C.
below.
2. Investment Restrictions
Both the New Fund and the Fund have identical fundamental investment
restrictions which cannot be changed without the affirmative vote of a majority
of each Fund's outstanding voting securities as defined in the 1940 Act.
SF:58206.2
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<PAGE>
3. Comparative Summary of Investor Costs
The following table summarizes the costs of investing in the Fund,
based on expenses incurred in the most recent fiscal year, and in the New Fund,
based on estimated expenses for the current fiscal year.
<TABLE>
<CAPTION>
Segall Bryant
& Hamill Growth SB&H Mid Cap
and Income Fund* Fund**
-------------------------- -----------------------
(pro forma)
SHAREHOLDER TRANSACTION EXPENSES
<S> <C> <C>
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price) None None
Sales Charge Imposed on Dividend
Reinvestments None None
Maximum Contingent Deferred Sales Charge None None
Redemption Fees None None
Exchange Fees None None
ANNUAL OPERATING EXPENSES:
(as a percentage of average net assets)
Investment Advisory Fee 0.75% 0.75%
12b-1 Fee 0.25% 0.25%
Other Expenses (after voluntary expense
reimbursements) 0.75% 0.40%
Total Fund Operating Expenses (after voluntary 1.75% 1.40%
expense reimbursements)
</TABLE>
* For the fiscal year ended April 30, 1998, without voluntary expense
reimbursements and expenses paid by unaffiliated third parties, Other
Expenses would have been 1.39% and Total Fund Operating Expenses would have
been 2.39%.
** SB&H has agreed to reduce its fees and/or pay expenses of the New Fund to
insure that the New Fund's expenses will not exceed 1.40%. If SB&H did not
limit the New Fund's expenses, it is estimated that "Other Expenses" in the
above table would be 1.45% and "Total Fund Operating Expenses" would be
2.45%. If SB&H does waive any of its fees or pay New Fund expenses, the New
Fund may reimburse SB&H in future years. SB&H may, however, in the future
terminate such fee reduction and/or reimbursement of expenses on a
prospective basis.
Example
Assume, hypothetically, that each Fund's annual return is 5% and that
its operating
SF:58206.2
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<PAGE>
expenses are as set forth above, an investor buying $1,000 of the Fund's and the
New Fund's shares would have paid the following total expenses upon redeeming
such shares:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
Segall, Bryant & Hamill
Growth and Income Fund $18 $55 $95 $206
SB&H Mid Cap Fund $14 $44 N/A N/A
</TABLE>
The above example is to show the effect of expenses. This example does not
represent past or future expenses or returns. Actual expenses and returns may
vary.
4. Comparative Performance Information
The table below indicates the average annual total return (with capital
gains and all dividends and distributions reinvested) for Class A shares of the
Fund during the periods ending April 30, 1998. Performance for the Fund includes
the performance of its predecessor fund, Voyageur Growth and Income Fund. On
April 30, 1997, the Fund acquired the assets and assumed all the liabilities of
the Voyager Growth and Income Fund. The New Fund is a new series of AST Trust
that is not yet in operation. Therefore, no performance information is
available.
One Year 30.39%
Since Inception 20.22%
(9/7/95)
Additional performance information on the Fund may be found in its 1998 Annual
Report to Shareholders.
5. Advisory Fees, Sub-Advisory Fees and Other Expenses
The advisory fees of the Fund and the New Fund are identical.
Currently, VAM LLC serves as investment advisor to the Fund pursuant to an
Investment Advisory Agreement between the VAM Funds and VAM LLC dated April 30,
1997. SB&H serves as the sub-advisor to the Fund pursuant to a Sub-Advisory
Agreement between VAM LLC and SB&H dated April 30, 1997. The Fund pays VAM LLC a
monthly investment advisory fee equivalent on an annual basis to 0.75% of its
average daily net assets. VAM LLC in turn pays SB&H sub-advisory fees of 0.75%
of the Fund's average daily net assets.
After the Reorganization, SB&H will serve as investment advisor to the
New Fund pursuant to an Advisory Agreement. The New Fund will pay SB&H a monthly
management fee based upon the New Fund's average daily net assets at the annual
rate of 0.75%. The New Fund does not have any investment sub-advisor.
SF:58206.2
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<PAGE>
The expense ratio of the New Fund (which, because of certain voluntary
waivers by SB&H) is expected to be lower than the expense ratio of the Fund for
the balance of 1999 (1.40% for the New Fund as compared to 1.75% for the Fund)
because of certain voluntary waiver and expense reimbursements by SB&H. Absent
the fee waiver, the New Fund's total operating expenses would be 2.45%.
For the fiscal year ended April 30, 1998, the Fund paid advisory fees
of $44,267. During the same period, VAM LLC and the Fund's distributor,
Dougherty Summit Securities LLC, absorbed or waived fees in the amount of
$34,000.
6. Distribution and Shareholder Services
Dougherty Summit Securities LLC has served as distributor of the Fund's
shares since April 30, 1998. First Fund Distributors, Inc., an affiliate of the
New Fund's administrator --Investment Company Administration, LLC ("ICAC")
(which is not affiliated with either the VAM Funds or VAM LLC) will serve as
distributor of the New Fund's shares.
The Fund imposes a maximum front-end sales load of 4.75% on its Class A
shares. In the event a shareholder purchases Class A shares of the Fund without
paying a front-end sales load as part of an investment of $1 million or more and
later redeems such shares within one year of purchase, a 1% contingent deferred
sales charge will be imposed. The New Fund shares, however, are not subject to
any sales charge. Furthermore, no sales charge is imposed by either the Fund or
the New Fund on reinvestment of dividends or capital gain distributions.
7. Distribution Plans
The VAM Funds have adopted a Rule 12b-1 distribution plan for the
Fund's shares, which provides for the payment of distribution fees at annual
rates of up to 0.25% of the average daily net assets attributable to the shares
of the Fund. Payments under the distribution plan shall be used to compensate or
reimburse the Fund's distributor and broker-dealers for services provided and
expenses incurred in connection with the sale of the Fund's shares, and are not
tied to the amount of actual expenses incurred.
The New Fund has also adopted a distribution plan pursuant to Rule
12b-1 (the "New Fund Plan"). The New Fund Plan provides that the New Fund will
pay for distribution and related expenses at an annual rate of up to 0.25% of
the New Fund's average net assets to SB&H as Distribution Coordinator. Payments
made pursuant to the New Fund Plan will represent compensation for distribution
and service activities, not reimbursement for specific expenses incurred. The
Plan allows excess distribution expenses to be carried forward for the following
three fiscal years. Expenses permitted to be paid by the New Fund under the New
Fund Plan include: preparation, printing and mailing of prospectuses;
shareholder reports such as semi-annual and annual report, performance reports
and newsletters; sales literature and other promotional material to prospective
investors; direct mail solicitation; advertising; public relations; compensation
of sales personnel; advisors or other third parties for the assistance with
respect to the distribution of the New Fund Shares; payments to financial
intermediaries for
SF:58206.2
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<PAGE>
shareholder support; administrative and accounting services with respect to the
shareholders of the New Fund; and such other expenses as may be approved from
time to time by the Board of Trustees of the AST Trust.
8. Administration, Custody, Fund Accounting and Transfer Agency
Services
Pursuant to an Administration Agreement (the "Administration
Agreement") between AST Trust and ICAC, ICAC would act as administrator for AST
Trust and would provide various administrative services including (but not
limited to) arranging for the maintenance of certain books and records of the
New Fund, preparing and mailing certain documents in connection with tax and
disclosure obligations, preparing agendas and supporting documentation or, and
minutes of, meetings of AST Trust Board of Trustees and meetings of shareholders
and coordinating all relationships between the New Fund and its other service
providers. The administration services provided to AST Trust pursuant to the
Administration Agreement are similar in scope to the administration services
provided to the VAM Funds pursuant to its existing administration agreement.
Pursuant to a Transfer Agency Agreement (the "Transfer Agency
Agreement") between AST Trust and American Data Services, Inc. ("ADS"), ADS
would act as the transfer agent and dividend disbursing agent for the New Fund.
The services provided under the Transfer Agency Agreements are similar to those
provided under the VAM Funds' existing transfer agency agreement.
Pursuant to a Custody Agreement (the "Custody Agreement") between AST
Trust and Star Bank, N.A. ("Star Bank"), Star Bank would act as custodian of the
portfolio securities, cash and other property of the New Fund. Pursuant to the
VAM Funds' existing custody agreement with Norwest Bank Minnesota, N.A.
("Norwest"), Norwest provides accounting and certain recordkeeping services for
the VAM Funds' portfolios. The terms of the portions of the Custody Agreement
relating to custodial services are similar in all material respects to the terms
of the VAM Funds' existing custodian agreement with Norwest.
9. Purchase Procedures
The Fund generally requires a minimum initial investment of $1,000 and
minimum subsequent investments of $100 or more. The New Fund has identical
minimum purchase requirements. However, for investments in an Individual
Retirement Account and Automatic Investment Plan, the minimum initial investment
is $250 and minimum subsequent investment is $100. In the case of the New Fund,
special reduced minimum investment limits apply to participants in 401(k) plans
and employee benefit plans with separate accounts for employees,
The Fund's shares are purchased at the public offering price, which is
based on the net asset value next determined after receipt of a shareholder's
order in proper form. If a shareholder buys shares through his or her investment
representative, the representative must receive the shareholder's order before
the close of regular trading on the New York Stock Exchange to receive that
day's public offering price. The New Fund shares are purchased using a similar
SF:58206.2
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<PAGE>
method. To eliminate the need for safekeeping, neither the Fund nor the New Fund
will issue share certificates.
10. Redemption Procedures
Shareholders of both Funds may redeem their shares at the net asset
value next determined after receipt of a written redemption request or a
telephone redemption order without the imposition of any fee or other charge. As
noted above, however, in the case of Class A shares of the Fund, a contingent
deferred sales charge of 1% is imposed on certain redemptions of Class A shares
that were purchased without an initial sales charge as part of an investment of
$1 million or more.
11. Income Dividends, Capital Gain Distributions and Taxes
The Fund distributes substantially all of its net investment income and
net capital gains to shareholders each year. The New Fund intends to continue
this policy. Both Funds also have identical distribution options. Shareholders
of the Fund and the New Fund may choose from three distribution options: (1)
reinvest all distributions in additional Fund shares without a sales charge; (2)
receive distributions from net investment income in cash while reinvesting
capital gain distributions in additional shares without a sales charge; or (3)
receive all distributions in cash. Shareholders of the New Fund can change their
distribution option by notifying the transfer agent in writing. If a shareholder
does not select an option when the shareholder opens the account, all
distributions will be reinvested. All distributions not paid in cash will be
reinvested in shares of the Fund.
The New Fund intends to qualify as a separate "regulated investment
company" under Subchapter M of the Code for federal income tax purposes and to
meet all other requirements that are necessary for it (but not its shareholders)
to pay no federal taxes on income and capital gains paid to shareholders in the
form of dividends. In order to accomplish this goal, the New Fund must, among
other things, distribute substantially all of its ordinary income and net
capital gains on a current basis and maintain a portfolio of investments which
satisfies certain diversification criteria.
12. Portfolio Transactions and Brokerage Commissions
After the closing of the Reorganization, SB&H will continue to be
responsible for decisions to buy and sell securities, broker-dealer selection,
and negotiation of commission rates through its new capacity as the advisor. In
placing orders for the Fund's (and after the closing of the Reorganization, the
New Fund's) portfolio transactions, SB&H will use its best efforts to seek to
execute portfolio transactions in a manner which, under the circumstances,
result in total costs or proceeds being the most favorable to the New Fund. In
assessing the best overall terms available for any transaction, SB&H considers
all factors it deems relevant, including the breadth of the market in the
security, the price of the security, the financial condition and execution
capability of the broker or dealer, research services provided to SB&H, and the
reasonableness of the commissions, if any, both for the specific transaction and
on a continuing basis. SB&H is not
SF:58206.2
16
<PAGE>
required to obtain the lowest commission or the best net price for the New Fund
on any particular transaction, is not required to execute any order in a fashion
either preferential to the New Fund relative to other accounts they manage or
otherwise materially adverse to any other accounts.
13. Shareholders' Rights
VAM Funds is a Minnesota corporation. Because the Fund is a series of
the VAM Funds, its operations are governed by the VAM Fund's Articles of
Incorporation and By-laws and applicable Minnesota law. AST Trust is a Delaware
business trust. Because the New Fund is a series of AST Trust, its operations
are governed by AST Trust's Agreement and Declaration of Trust and By-laws and
applicable Delaware law.
Under Delaware law, trustees and shareholders of a business trust are
generally afforded by statute the same limited liability as their corporate
counterparts and are permitted liberal indemnifications. However, some states do
not recognize the liability limitation provided by Delaware law. Furthermore,
AST Trust, being a Delaware business trust, has a Board of Trustees instead of a
Board of Directors, as is the case of VAM Funds. The composition of the Board of
Trustees of the AST Trust is also different from that of the VAM Funds, [both in
terms of membership and size.]
The Funds normally will not hold meetings of shareholders except as
required under the 1940 Act and Minnesota law (in the case of the Fund) or
Delaware law (in the case of the New Fund). However, with respect to each of the
Fund and the New Fund, a meeting of shareholders shall be held upon the written
request of the holders of shares representing not less than 10% of the
outstanding shares entitled to vote on the matters specified in the written
request.
Shareholders of each Fund have no preemptive, conversion or
subscription rights. The shares of each Fund have non-cumulative voting rights,
with each shareholder of that Fund entitled to one vote for each full share of
that Fund (and a fractional vote for each fractional share) held in the
shareholder's name on the books of that Fund as of the record date for the
action in question. On any matter submitted to a vote of shareholders, shares of
each Fund will be voted by that Fund's shareholders individually when the matter
affects the specific interest of that Fund only, such as approval of that Fund's
investment management arrangements. The shares of the Funds will be voted in the
aggregate on other matters, such as the election of trustees or directors, as
appropriate, and ratification of the Boards' selection of the Funds' independent
accountants.
C. RISK FACTORS
The New Fund's portfolio, like that of the Fund, is subject to the
general risks and considerations associated with equity investing. In addition,
some of the securities which both the New Fund and the Fund may invest may be of
smaller companies. The securities of smaller companies often trade less
frequently and in more limited volume, and may be subject to more abrupt or
erratic price movements, than securities of larger, more established companies.
Such companies may have limited product lines, markets or financial resources,
or may depend on a
SF:58206.2
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<PAGE>
limited management group. While the Fund emphasizes investments in equity
securities of well-established companies, the New Fund will emphasize investment
in the equity securities of mid cap companies. Investing in securities of mid
cap companies may involve greater risk than investing in securities of large cap
companies, since securities of mid cap companies can be subject to more abrupt
or erratic movements in value. However, they tend to involve less risk than
securities of small cap companies.
Unlike the Fund, which limits its short sale activities to "short sale
against the box", the New Fund may engage in sell short securities that it does
not own. Short sales by the Fund create opportunities to increase the Fund's
return but, at the same time, involve specific risk considerations and may be
considered a speculative technique. Since the Fund in effect profits from a
decline in the price of the securities sold short without the need to invest the
full purchase price of the securities on the date of the short sale, the Fund's
net asset value per share will tend to increase more when the securities it has
sold short decrease in value, and to decrease more when the securities it has
sold short increase in value, than would otherwise be the case if it had not
engaged in such short sales. The amount of any gain will be decreased, and the
amount of any loss increased, by the amount of any premium, dividends or
interest the Fund may be required to pay in connection with the short sale.
Furthermore, under adverse market conditions the Fund might have difficulty
purchasing securities to meet its short sale delivery obligations, and might
have to sell portfolio securities to raise the capital necessary to meet its
short sale obligations at a time when fundamental investment considerations
would not favor such sales.
D. RECOMMENDATION OF THE BOARD OF DIRECTORS
In response to the circumstances described above, the Board of
Directors of the VAM Funds, after due consideration, has unanimously approved
the proposed Reorganization, subject to approval by shareholders. The Directors,
after reviewing the terms of the proposed Reorganization, concluded the proposed
Reorganization to be in the best interests of the shareholders of the Fund. The
Board of Directors also unanimously recommends that shareholders vote for the
adoption of the proposal.
1. The Legal Framework
The proposed Reorganization, if approved by the Fund's shareholders,
will close as soon as practicable, subject to the satisfaction or certain
conditions thereto. The Investment Advisory Agreement between the New Fund and
SB&H will remain in effect for an initial term of up to two years and will
continue in effect thereafter for successive periods if and so long as such
continuance is specifically approved annually by (a) the Board of Trustees of
AST Trust or (b) a majority vote of the New Fund's shareholders, provided that
in either event, the continuance also is approved by a majority of the Trustees
who are not interested persons (the "independent Trustees") by vote cast in
person at a meeting called for the purpose of voting on such approval.
2. The Directors' Considerations
SF:58206.2
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<PAGE>
The transactions contemplated by the Reorganization were presented to
the Board of Directors of the VAM Funds for consideration at its December 7,
1998 Board of Directors meeting. The Board of Directors, including a majority of
the independent Directors, voted to approve the proposed Reorganization. The
Board of Directors concluded unanimously that the Proposal set forth in this
Combined Proxy Statement and Prospectus is in the best interests of the Fund and
its shareholders and would not result in the dilution of such shareholders'
interests.
In determining whether to recommend approval of the Reorganization to
shareholders of the Fund, the Board of Directors (including the independent
Directors), made an inquiry into a number of matters and considered the
following factors, among others: (i) the compatibility of investment objectives,
policies and restrictions of the Fund and the New Fund, (ii) the capabilities of
SB&H and other service providers to the New Fund, (iii) the nature of the Fund's
existing shareholder base, (iv) expense ratios and available information
regarding the fees and expenses of the Fund and the New Fund as well as similar
funds, (v) portfolio transaction policies of the Fund and the New Fund, (vi) the
terms and conditions of the Reorganization and whether the Reorganization would
result in dilution of shareholder interests, (vii) costs incurred by the Fund
and New Fund as a result of the Reorganization, (viii) tax consequences of the
Reorganization and (ix) possible alternatives to the Reorganization.
In reaching the decision to approve the Reorganization and to recommend
that the shareholders of the Fund vote to approve the Reorganization, the Board
of Directors, including the independent Directors, unanimously concluded that
the participation of the Fund in the Reorganization is in the best interests of
the Fund's shareholders and would not result in the dilution of such
shareholders' interests. Their conclusion was based on a number of factors,
including the following:
(1) The investment objective of the Fund and the New Fund will
be identical and policies and restrictions will be substantially the same.
(2) SB&H will continue to be responsible for providing
day-to-day investment management services to the Fund following consummation of
the Reorganization, which the Directors believe to be important to the Fund's
existing shareholder base.
(3) SB&H has agreed to waive fees payable to it and/or
reimburse the New Fund for expenses in excess of fixed expense caps, and to keep
(at least initially) the total operating expenses of the New Fund to that below
the current fee level, even though SB&H may in the future modify or eliminate
such reduction.
E. DISSENTERS' RIGHT OF APPRAISAL
Shareholders of the Fund who object to the proposed Reorganization will
be entitled to "dissenters' rights" under Minnesota law, which allows dissenting
shareholders to recover the fair value of the shareholders' shares. However,
shareholders of the Fund has, in any event, the right at any time up to the
Effective Date to redeem shares of the Fund at net asset value. After the
Reorganization, such shareholders will hold shares of the New Fund, which may
also be
SF:58206.2
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<PAGE>
redeemed in net asset value in accordance with the procedures described in the
New Fund's Preliminary Prospectus dated ____________, subject to the forward
pricing requirements of Rule 22c-1 under the 1940 Act.
F. FURTHER INFORMATION ABOUT THE FUND AND THE NEW FUND
Further information about the Fund is contained in its current
Prospectus and Statement of Additional Information dated August 27, 1998, which
are incorporated herein by reference. Further information about the New Fund is
contained in its Preliminary Prospectus and Preliminary Statement of Additional
Information dated ___________, 1998, which are incorporated herein by reference.
Documents that relate to the Fund are available, without charge, by writing to
American Data Services, Inc., 150 Motor Parkway, Suite 109, Hauppauge, NY 11788
by calling (888) 229-2105. Copies of the Fund's Prospectus and the New Fund's
Preliminary Prospectus also accompany this Combined Proxy Statement and
Prospectus.
The VAM Funds are subject to the informational requirements of the
Securities and Exchange Act of 1934 and the 1940 Act, and in accordance
therewith files reports, proxy materials and other information with the SEC.
Such reports, proxy materials and other information can be inspected and copied
at the Public Reference Room maintained by the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the SEC's regional offices at
_____________________. Copies of such materials can be obtained at prescribed
rates from the Public Reference Branch, Office of Consumer Affairs and
Information Services, of the SEC, Washington, D.C. 20549.
G. VOTE REQUIRED
Approval of the proposed Reorganization requires the affirmative vote
of the holders of a majority (as defined under the 1940 Act and as described
above) of the total number of the Fund's Class A shares outstanding on the
Record Date. If the shareholders of the Fund do not approve the proposed
Reorganization, or if the Reorganization is not consummated for any other
reason, then the Board of Directors will take such further action as it deems to
be in the best interest of the Fund and its shareholders subject to approval by
the shareholders of the Fund if required by applicable law.
III. MISCELLANEOUS ISSUES
A. OTHER BUSINESS
The Board of Directors of the VAM Funds know of no other business to be
brought before the Meeting. However, if any other matters come before the
Meeting, it is the Board of Directors' intention that proxies which do not
contain specific restrictions to the contrary will be voted on such matters in
accordance with the judgment of the persons named in the enclosed form of proxy.
SF:58206.2
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<PAGE>
B. NEXT MEETING OF SHAREHOLDERS
The VAM Funds are not required and do not intend to hold annual or
other periodic meetings of shareholders except as required by the 1940 Act. If
the Reorganization is not consummated, the next meeting of the shareholders of
the Fund will be held at such time as the Board of Directors may determine or at
such time as may be legally required. Any shareholder proposal intended to be
presented at such meeting must be received by the VAM Funds at its office at a
reasonable time before the Meeting, as determined by the Board of Directors, to
be included in the VAM Fund's proxy statement and form of proxy relating to such
meeting, and must satisfy all other legal requirements.
C. EXPERTS
The financial statements of the Fund incorporated in this Combined
Proxy Statement and Prospectus by reference to the Annual Report to Shareholders
for the year ended April 30, 1998, have been so incorporated in reliance on the
report of KPMG Peat Marwick LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE
SF:58206.2
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<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION is made as of the____ day of
_____ ,1998, by and between VAM INSTITUTIONAL FUNDS, INC. ("VAM Funds"), a
Minnesota corporation, on behalf of Segall Bryant & Hamill Growth and Income
Fund (the "Fund") and ADVISORS SERIES TRUST (the "Trust"), a Delaware business
trust, on behalf of SB&H Mid Cap Fund (the "Mid Cap Fund").
In consideration of the mutual promises herein contained, the parties
hereto agree as follows:
1. Approval by Shareholders
A meeting of the shareholders of the Fund shall be called and held for
the purpose of acting upon this Agreement and Plan of Reorganization (the
"Agreement") and the transactions contemplated herein.
2. Plan of Reorganization
(a) On behalf of the Fund, VAM Funds will convey, transfer and
deliver to the Trust at the closing provided for in Section 3 (hereinafter
called the "Closing") all of the Fund's then existing assets, the assets
belonging to the Fund to be conveyed, transferred and delivered to the Mid Cap
Fund, a newly-formed series of the Trust. In consideration thereof, the Trust
agrees at the Closing (i) to assume and pay, to the extent that they exist on or
after the effective date of the Reorganization (as defined in Section 3 hereof),
all of the Fund's obligations and liabilities, whether absolute, accrued,
contingent or otherwise, the obligations and liabilities of the Fund to become
the obligations and liabilities of the Mid Cap Fund; and (ii) to deliver to the
Fund full and fractional shares of beneficial interest of the Mid Cap Fund, no
par value (the "Shares"), equal in number to the number of full and fractional
shares of capital stock of the Fund, $0.01 par value, outstanding immediately
prior to the effective date of the Reorganization.
(b) At the effective date of the Reorganization, VAM Funds
will distribute pro rata to the shareholders of record of the Fund as of the
effective date of the Reorganization the Shares of the Mid Cap Fund received by
the Fund pursuant to this Section 2. Each shareholder of record of the Fund will
receive a number of Shares of the Mid Cap Fund equal to the number of shares of
the Fund held at the effective date of the Reorganization. Such distribution
will be accompanied by the establishment of an open account on the stock records
of the Trust in the name of each such shareholder of the Fund and representing
the number of Shares due such shareholder. Fractional Shares will be carried to
the third decimal place. Certificates representing Shares will not be issued.
(c) Prior to the Closing, all redemption requests received in
proper order and form and not previously satisfied will be aggregated and the
total dollars to be paid out resulting
SF:58206.2
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<PAGE>
from the redemptions will be set aside by VAM Funds' transfer agent. After the
Closing, the Trust's transfer agent will honor all such pre-Closing redemptions
on behalf of VAM Funds and its transfer agent.
(d) As soon as practicable after the effective date of the
Reorganization, VAM Funds shall take all necessary steps under Minnesota law to
effect a complete liquidation and dissolution of the Fund.
(e) The transactions contemplated herein are referred to as
the "Reorganization."
3. Closing and Effective Date of the Reorganization
With respect to the Fund, the Closing shall occur on (a) the final
adjournment of the meeting of shareholders of the Fund at which this Agreement
will be considered or (b) such later date as the parties may mutually agree (the
"effective date of the Reorganization").
4. Conditions Precedent
The obligations of VAM Funds and the Trust to effectuate the Agreement
hereunder shall be subject to the satisfaction of each of the following
conditions:
(a) Such authority, including "no-action" letters, and orders
from the Securities and Exchange Commission (the "Commission") and state
securities commissions, as may be necessary to permit the parties to carry out
the transactions contemplated by this Agreement shall have been received.
(b) (i) The Trust's Registration Statement and any amendments
thereto, as may be deemed necessary and appropriate, prepared on Form N-1A shall
have been filed with the Commission under the Securities Act of 1933 (the "1933
Act") and the Investment Company Act of 1940 (the "1940 Act"); and (ii) no
stop-order suspending the effectiveness of the Registration Statement shall have
been issued, and no proceeding for that purpose shall have been initiated or
threatened by the Commission (and not withdrawn or terminated).
(c) Confirmation shall have been received from the Commission
or its staff that the Trust, effective upon or before the effective date of the
Reorganization, shall be duly registered as an open-end management investment
company under the 1940 Act.
(d) Each party shall have received an opinion from Paul,
Hastings, Janofsky & Walker LLP, addressed to both parties substantially to the
effect that, for federal income tax purposes: (i) the transfer by the Fund of
substantially all of its assets to the Mid Cap Fund solely in exchange for the
Shares, as described above, is a reorganization within the meaning of Section
368(a)(1)(F) of the Internal Revenue Code (the "Code"); (ii) no gain or loss is
recognized by the Fund upon the transfer of substantially all of its assets to
the Mid Cap Fund in exchange solely for the Shares; (iii) no gain or loss is
recognized by the Mid Cap Fund on receipt of the Fund
SF:58206.2
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<PAGE>
assets in exchange for the Shares; (iv) the basis of the assets of the Fund in
the hands of the Mid Cap Fund is, in each instance, the same as the basis of
those assets in the hands of the Fund immediately prior to the transaction; (v)
the holding period of the Fund's assets in the hands of the Mid Cap Fund
includes the period during which the assets were held by the Fund; (vi) no gain
or loss is recognized to the shareholders of the Fund upon the receipt of the
Shares solely in exchange for the Fund's shares; (vii) the basis of the Shares
received by the Fund's shareholders is, in each instance, the same as the basis
of the Fund shares surrendered in exchange therefor; and (viii) the holding
period of the Shares received by the Fund's shareholders includes the holding
period during which shares of the Fund surrendered and exchanged therefor were
held, provided that such shares were held as a capital asset in the hands of the
Fund's shareholders on the date of the exchange. Furthermore, notwithstanding
anything herein to the contrary, neither the Mid Cap Fund nor the Fund may waive
the condition set forth in this paragraph Section 4(d).
(e) The Shares shall have been duly qualified for offering to
the public in such jurisdictions (except where such qualifications are not
required) so as to permit the transfers contemplated by this Agreement to be
consummated.
(f) With respect to the Fund, a vote approving this Agreement
and the Reorganization contemplated hereby shall have been adopted by at least a
majority of the outstanding shares of common stock of the Fund entitled to vote
at an annual or special meeting.
(g) With respect to the Mid Cap Fund, the Trustees of the
Trust shall have taken the following action at a meeting duly called for such
purposes:
(1) the approval of the Investment Advisory
Agreement between the Trust on behalf of the
Mid Cap Fund, and Segall Bryant & Hamill;
(2) the approval of the Plan of Distribution
adopted by the Trust, on
behalf of the Mid Cap Fund;
(3) the approval of the Distribution Agreement
between the Trust and
First Fund Distributors, Inc.; and
(4) the ratification of the selection of
McGladrey & Pullen LLP as independent
certified public accountants for the Mid Cap
Fund;
(5) the authorization of the issuance by the
Trust prior to the effective date of the
Reorganization, of one or more Shares of the
Mid Cap Fund to the Fund in consideration
for the payment of $1.00 per Share for the
purpose of enabling the Fund to vote on the
matters referred to above in this Section 4;
(6) the submission of the matters referred to in
paragraph (g) of this Section 4 to the sole
shareholder of the Mid Cap Fund; and
SF:58206.2
24
<PAGE>
(7) the authorization of the issuance by the
Trust of Shares at the effective date of the
Reorganization in exchange for the Fund's
assets pursuant to the terms and provisions
of this Agreement.
(h) With respect to the Fund, the shareholders of the Fund
shall have voted to direct the Fund to vote, and the Fund shall have voted,
immediately after it becomes sole shareholder of the Mid Cap Fund, to:
(1) approve all actions necessary to carry out the Plan of
Reorganization, including to;
(i) approve the Investment Advisory Agreement;
(ii) approve the Plan of Distribution;
(iii) approve the Distribution Agreement; and
(iv) approve the selection of McGladrey &
Pullen LLP as independent certified
public accountants for the Mid Cap
Fund; and
(i) With respect to the Fund, the shareholders of the Fund
shall have voted to approve its reorganization into the Mid Cap Fund.
At any time prior to the Closing for the Fund, any of the
foregoing conditions (other than the condition set forth in Section 4(d)) may be
waived by the Board of Directors of VAM Funds if, in the judgment of such Board,
such waiver will not have a material adverse effect on the benefits intended
under this Agreement to the shareholders of the Fund.
(j) All accrued and unpaid expenses of the Fund, including all
administrative, legal and other expenses owed by the Fund or Segall Bryant &
Hamill to VAM Funds or its agents shall have been paid in full. In addition, an
amount equal to $500 shall be deposited in an escrow account for payment of all
expenses owed, or expected to be owed, to VAM Funds or its agents relating to
the Reorganization not otherwise accrued and paid at Closing.
5. Expenses
The expenses of entering into and carrying out the provisions of this
Agreement and the Reorganization and the proxy solicitation contemplated herein
will be borne by the Fund.
6. Indemnification
(a) Segall Bryant & Hamill, its successors or assigns, the
Trust and the Mid Cap Fund each agree to indemnify VAM Funds, the Fund, its
directors (in their capacity as directors or officers), and agents from all
liabilities that may arise in connection with, or as a
SF:58206.2
25
<PAGE>
result of, the Reorganization or the proxy material distributed to shareholders
of the Fund and the proxy solicitation contemplated in this Agreement. No party
shall be entitled to indemnification under this Agreement unless written notice
of the events or circumstances giving rise to such claim for indemnification has
been provided to the indemnifying party or parties no later than two (2) years
after the date of the Closing. Notwithstanding the above, any such
indemnification for acts occurring after the date of the Closing shall be for a
period not later than one (1) year after such Closing.
(b) Voyageur Asset Management LLC, its successors or assigns,
the VAM Funds and the Fund each agree to indemnify the Trust, the Mid Cap Fund,
its directors and trustees (in their capacity as directors and trustees or
officers), and agents from all liabilities that may arise in connection with, or
as a result of, the Reorganization or the proxy material distributed to
shareholders of the Fund and the proxy solicitation contemplated in this
Agreement. No party shall be entitled to indemnification under this Agreement
unless written notice of the events or circumstances giving rise to such claim
for indemnification has been provided to the indemnifying party or parties no
later than two (2) years after the date of the Closing. Notwithstanding the
above, any such indemnification for acts occurring after the date of the Closing
shall be for a period not later than one (1) year after such Closing.
7. Termination
With respect to the Fund and the Mid Cap Fund, the Board of Directors
of VAM Funds or the Board of Trustees of the Trust, respectively, may terminate
this Agreement and abandon the Reorganization contemplated hereby, at any time
prior thereto, notwithstanding approval thereof by the shareholders of the Fund
if, in the judgment of such Boards, proceeding with the Agreement would be
inadvisable.
8. Entire Agreement
This Agreement embodies the entire agreement between the parties and
there are no agreements, understandings, restrictions or warranties among the
parties other than those set forth herein or herein provided for. Furthermore,
after the Fund's shareholders have approved this Agreement, no amendments may be
made that materially adversely affect the interests of the shareholders of the
Fund unless such amendments are submitted for shareholder approval.
9. Further Assurances
Each of VAM Funds and the Trust shall take such further action as may
be necessary or desirable and proper to consummate the transactions contemplated
hereby.
10. Governing Law
This Agreement and the transactions contemplated hereby shall be
governed by and construed and enforced in accordance with the laws of the State
of Delaware.
SF:58206.2
26
<PAGE>
IN WITNESS WHEREOF, each of VAM Funds and the Trust has caused this
Agreement and Plan of Reorganization to be executed on its behalf by its
Chairman, President or a Vice President and attested by its Secretary or
Assistant Secretary, all as of the day and year first above written.
VAM INSTITUTIONAL FUNDS, INC, a Minnesota
corporation, on behalf of Segall Bryant & Hamill
Growth and Income Fund
----------------------------------------
ATTEST:
- - ----------------------------------
Secretary
ADVISORS SERIES TRUST, a Delaware
business trust, on behalf of SB&H Mid Cap Fund
---------------------------------------
ATTEST:
- - ------------------------------------
Secretary
Accepted and agreed to as to Sections 5 and 6 only:
SEGALL BRYANT & HAMILL
By:_________________________________
(Name)
(Title)
Accepted and agreed to as to Sections 5 and 6 only:
VOYAGEUR ASSET MANAGEMENT LLC
By:_________________________________
(Name)
(Title)
SF:58206.2
27
<PAGE>
PROXY
FOR SPECIAL MEETING OF SHAREHOLDERS OF
SEGALL BRYANT & HAMILL GROWTH AND INCOME FUND
ON JANUARY 29, 1999
The undersigned hereby appoints Paul Fricke and C. Alfred Bryant, or
each of them, proxies for the undersigned, with full power of substitution, to
represent the undersigned and to vote all of the shares of Segall Bryant &
Hamill Growth and Income Fund (the "Fund") of VAM Institutional Funds, Inc. (the
"VAM Funds") which the undersigned is entitled to vote at the Special Meeting of
Shareholders of the Fund to be held on January 29, 1999, and at any adjournment
thereof.
1. To approve or disapprove a proposed reorganization of the Fund
into the SB&H Mid Cap Fund, a newly formed series of Advisors
Series Trust.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
And, in their discretion, to transact any other business that may
lawfully come before the Meeting or any adjournment(s) thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND
WILL BE VOTED AS DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED FOR THE PROPOSAL.
Dated:___________________________
-----------------------------
Signature of Shareholder
-----------------------------
Signature of Shareholder
When shares are registered jointly in the names of two or more persons, ALL such
persons must sign. Signature(s) must correspond exactly with the name(s) the
shares are registered under.
Please sign, date and return promptly in the enclosed envelope.
SF:58206.2
28
<PAGE>
PART B
VAM INSTITUTIONAL FUNDS, INC.
SEGALL BRYANT & HAMILL GROWTH AND INCOME FUND
90 South Seventh Street
Suite 4300
Minneapolis, MN 55402
(612) 376-7000
---------
STATEMENT OF ADDITIONAL INFORMATION
DATED JANUARY __, 1999
FOR REGISTRATION STATEMENT ON FORM N-14
This Statement of Additional Information is not a prospectus
and should be read in conjunction with the Combined Proxy Statement and
Prospectus dated January __, 1999, which has been filed by Advisors Series Trust
("AST Trust") in connection with a Special Meeting of Shareholders of the Segall
Bryant & Hamill Growth and Income Fund (the "Fund") of VAM Institutional Funds,
Inc. (the "VAM Funds") that has been called to vote on an Agreement and Plan of
Reorganization (and the transactions contemplated thereby). Copies of the
Combined Proxy Statement and Prospectus may be obtained at no charge by writing
to American Data Service, Inc., 150 Motor Parkway, Suite 109, Hauppauge, NY
11788 or by calling toll-free 1-888-229-2105.
Unless otherwise indicated, capitalized terms used herein and
not otherwise defined have the same meanings as are given to them in the
Combined Proxy Statement and Prospectus.
Further information about the VAM Funds, the Fund, AST Trust
and the SB&H Mid Cap Fund (the "New Fund") is contained in the Fund's Prospectus
dated August 27, 1998 , the New Fund's Preliminary Prospectus dated ___________,
1998, and the Annual Report of the Fund for the fiscal year ended April 30,
1998. The Fund's Statement of Additional Information dated August 27, 1998, and
the New Fund's Preliminary Statement of Additional Information dated
____________, 1998, are incorporated by reference in this Statement of
Additional Information and is available without charge by calling American Data
Services, Inc. at (888) 229- 2105.
Pro-forma financial statements are attached hereto as Exhibit
A.
SF:58206.2
29
<PAGE>
TABLE OF CONTENTS
Page
General Information........................................................B-2
Exhibit A..................................................................B-3
SF:58206.2
30
<PAGE>
GENERAL INFORMATION
The shareholders of the Fund are being asked to approve a form
of Agreement and Plan of Reorganization (the "Plan") combining the Fund into the
New Fund (and the transactions contemplated thereby). The Plan contemplates the
transfer of all of the assets of the Fund as of the Effective Date to the New
Fund, and the assumption by the New Fund of the liabilities of the Fund, in
exchange for shares of the New Fund. Immediately after the Effective Date, the
Fund will distribute to its shareholders of record as of the close of business
on the Effective Date the shares of the New Fund received. The shares of the New
Fund that will be issued for distribution to the Fund's shareholders will have
an aggregate net asset value equal to the aggregate net asset value of the
shares of the Fund held as of the Closing Date. The VAM Funds will then take all
necessary steps to terminate the qualification, registration and classification
of the Fund. All issued and outstanding shares of the Fund will be canceled on
the Fund's books. Shares of the New Fund will be represented only by book
entries; no share certificates will be issued.
A Special Meeting of the Fund's shareholders to consider the
transaction will be held at the Fund's offices, 90 South Seventh Street, Suite
4400, Minneapolis, MN 55402 on January 29, 1999 at 10 a.m., local time.
For further information about the transaction, see the
Combined Proxy Statement and Prospectus. For further information about the VAM
Funds and the Fund, see the Fund's Statement of Additional Information, dated
August 27, 1998, which is available without charge by calling the American Data
Services, Inc. at (888) 229-2105. For further information about the AST Trust
and the New Fund, see the New Fund's Preliminary Statement of Additional
Information, dated ___________, 1998, which is available without charge by
calling the AST Trust at (602) 952-8520.
SF:58206.2
31
<PAGE>
Exhibit A
SEGALL BRYANT AND HAMILL GROWTH AND INCOME FUND
PORTFOLIO OF INVESTMENTS AT OCTOBER 31, 1998 (UNAUDITED)
- - --------------------------------------------------------------------------------
Shares COMMON STOCKS: 87.97% Market Value
- - --------------------------------------------------------------------------------
ADVERTISING AGENCIES: 2.94%
3,500 The Interpublic Group of Companies, Inc............. $ 204,750
---------
COMMERCIAL BANKS - U.S.: 2.39%
2,200 Star Banc Corporation............................... 166,375
---------
COMMERCIAL SERVICES: 2.25%
7,400 The ServiceMaster Company........................... 156,325
---------
COMPUTER SERVICES: 2.89%
3,500 Ceridian Corporation*............................... 200,813
---------
COMPUTER SOFTWARE: 2.59%
1,700 Microsoft Corporation*.............................. 179,988
---------
CONSUMER PRODUCTS - MISCELLANEOUS: 2.38%
6,000 Blyth Industries, Inc.*............................. 165,750
---------
DENTAL SUPPLIES AND EQUIPMENT: 1.11%
3,000 DENTSPLY International, Inc......................... 77,250
---------
DIVERSIFIED MANUFACTURING: 3.80%
3,200 Applied Power, Inc.................................. 88,200
8,000 Littlefuse, Inc.*................................... 176,000
---------
264,200
---------
ELECTRIC - INTEGRATED: 1.67%
2,400 New Century Energies, Inc........................... 115,950
---------
ELECTRONICS: 3.92%
6,500 Methode Electronics, Inc............................ 99,938
5,281 Molex Incorporated - Class A........................ 172,623
---------
272,561
---------
FINANCIAL GUARANTEE INSURANCE: 2.18%
3,900 MGIC Investment Corporation......................... 152,100
---------
FOOD - RETAIL: 4.13%
6,000 Safeway, Inc*....................................... $ 286,875
---------
IDENTIFICATION SYSTEMS / DEVICES: 2.57%
4,000 Symbol Technologies, Inc............................ 179,000
---------
INSTRUMENTS - SCIENTIFIC: 3.03%
SF:58206.2
32
<PAGE>
2,500 The Perkin-Elmer Corporation........................ 210,781
---------
INVESTMENT MANAGEMENT: 1.60%
7,000 Security Capital Group Incorporated - Class B*...... 111,563
---------
LIFE / HEALTH INSURANCE: 2.67%
5,000 Protective Life Corporation......................... 185,313
---------
MEDICAL - BIOMEDICAL GENETICS: 2.20%
2,200 Biogen, Inc.*....................................... 152,900
---------
MEDICAL - DRUGS: 2.70%
4,000 Abbott Laboratories................................. 187,750
---------
MEDICAL INSTRUMENTS: 1.95%
4,000 Biomet, Inc.*....................................... 135,750
---------
MEDICAL PRODUCTS: 2.93%
2,500 Johnson & Johnson................................... 203,750
---------
MULTI-LINE INSURANCE: 1.24%
2,000 The Allstate Corporation............................ 86,125
---------
OFFICE AUTOMATION AND EQUIPMENT: 2.79%
2,000 Xerox Corporation................................... 193,750
---------
OFFICE FURNISHINGS: 0.65%
2,500 Steelcase, Inc. - Class A........................... 45,000
---------
OFFICE SUPPLIES AND FORMS: 4.76%
3,700 Avery Dennison Corporation.......................... $ 153,318
5,700 New England Business Service, Inc................... 177,412
---------
330,730
---------
OPERATIONS: 5.60%
2,400 General Electric Company............................ 210,000
2,800 Illinois Tool Works, Inc............................ 179,550
---------
389,550
---------
PIPELINES: 2.28%
3,000 Enron Corp.......................................... 158,250
---------
PUBLISHING - NEWSPAPERS: 1.66%
2,000 Tribune Company..................................... 115,250
---------
RETAIL - BUILDING PRODUCTS: 5.73%
5,000 Fastenal Company.................................... 180,625
5,000 The Home Depot, Inc................................. 217,500
---------
398,125
---------
RETAIL - DISCOUNT: 2.40%
7,000 Dollar General Corporation.......................... 167,124
---------
SF:58206.2
33
<PAGE>
SUPER - REGIONAL BANKS - U.S.: 4.64%
3,000 First Union Corporation............................. 174,000
4,000 Norwest Corporation................................. 148,750
---------
322,750
---------
TELEPHONE - LONG DISTANCE: 1.59%
2,000 MCI WORLDCOM, Inc................................... 110,500
---------
TEXTILE APPAREL: 2.73%
11,000 Jones Apparel Group, Inc.*.......................... 189,750
---------
Total Common Stocks (cost $5,052,366)............... 6,116,648
---------
<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------
Principal Amount SHORT-TERM INVESTMENTS: 6.67%
- - --------------------------------------------------------------------------------
<S>
<C> <C>
$257,534 Star Treasury Fund................................................. $ 257,534
750,000 U.S. Treasury Strips*.............................................. 206,419
---------
Total Short-Term Investments (cost $425,393)....................... 463,953
- - ---------
Total Investments in Securities (cost $5,477,759+): 94.64%......... 6,580,601
Liabilities in excess of Other Assets: 5.36%....................... 372,492 ---------
TOTAL NET ASSETS: 100.0% .......................................... 6,953,093
=========
*Non-incoming producing security.
+At October 31, 1998, the cost of securities for Federal tax purposes was
approximately the same as the basis for financial reporting. Unrealized
appreciation and depreciation of securities were as follows:
Gross unrealized appreciation....................................... $1,215,761
Gross unrealized depreciation....................................... (112,919) ----------
Net unrealized appreciation......................................... $1,102,842
==========
See Notes to Financial Statements.
----------- -----------
</TABLE>
- - --------------------------------------------------------------------------------
Notes to Portfolio of Investments
INVESTMENTS IN SECURITIES
Investments in securities traded on national or international
securities exchanges are valued at the last sales price on that
exchange; securities traded in the over-the-counter market and
listed securities for which no sale was reported on the valuation
date are valued on the basis of the last current bid price. The
values of fixed income securities are determined by using pricing
services or prices quoted by independent brokers. When market
quotations are not readily available, or in certain other
circumstances, securities are valued at fair value according to
methods selected in good faith by the Board of Directors.
Investments in short-term securities with maturities of more than 60
days from the valuation date are valued at the last bid price or at
fair value as determined by a pricing service approved by the Board
of Directors. Short-term securities with maturities of less than 60
days are valued at amortized cost which approximates market value.
Security transactions are accounted for on trade date. Realized
SF:58206.2
34
<PAGE>
gains and losses are calculated on the identified cost basis.
Dividend income is recognized on the ex-dividend date. Interest
income, including level-yield amortization of premium and discount,
is accrued daily.
Pro Forma Statement of Assets and Liabilities October 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
Pro
Segall, Bryant Forma
& Hamill Growth Adjust- Pro Forma
And Income Fund ments Combined
---------- ----- --------
<S> <C> <C> <C>
ASSETS:
Investment securities, at value $6,580,601 $ 0 $6,580,601
Cash 2,127 19,662 21,789
Receivables:
Interest and Dividends 4,542 0 4,542
Fund Shares Sold 11,200 0 11,200
Portfolio Securities Sold 371,377 0 371,377
Unamortized Organization Expenses 19,662 (19,662) 0
Other assets 2,445 0 2,445
----------- ----------- -----------
Total assets 6,991,955 0 6,991,955
----------- ----------- -----------
LIABILITIES:
Accrued liabilities:
Administration fees 2,548 0 2,548
Distribution fees 6,525 0 6,525
Investment advisory fees 4,099 0 4,099
Other accrued expenses 12,316 0 12,316
Other Payables 13,374 0 13,374
----------- ----------- -----------
Total Liabilities 38,862 0 38,862
----------- ----------- -----------
NET ASSETS:
Paid-in capital 5,721,531 0 5,721,531
Accumulated undistributed net investment income (108,843) 0 (108,843)
Accumulated undistributed net realized gain (loss) on
investment transactions 237,563 0 237,563
Net unrealized appreciation/depreciation of investmen 1,102,842 0 1,102,842
----------- ----------- -----------
Net Assets: 6,953,093 0 6,953,093
----------- ----------- -----------
Shares of capital stock outstanding ($.01 par value; unlimited number of shares
authorized):
Shares 531,395 0 531,395
Shares:
Net asset value, redemption price and maxim $ 13.08 0 $ 13.08
offering price per share
Cost of Investments $ 5,477,759 $ 0 $ 5,477,759
See notes to financial statements
</TABLE>
SF:58206.2
35
<PAGE>
SBH Mid Cap Fund
Pro Forma Statements of Operations
For the six months ended October 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
Segall, Bryant Pro Forma
& Hamill Growth SB&H Mid
and Income Pro Forma Cap
Fund Adjustments Fund
---------- ------ ----
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividend $ 33,055 $ 0 $ 33,055
Interest 1,299 0 1,299
Other 10,450 0 10,450
---------- ---------- ----------
Total investment income 44,804 0 44,804
---------- ---------- ----------
EXPENSES: (Note 2)
Administrative fees 7,562 7,561 15,123
Distribution fees 8,563 0 8,563
Investment advisory fees 25,689 0 25,689
Custodian fees 1,815 1,785 3,600
Printing and postage 1,025 2,975 4,000
Professional fees 4,285 4,215 8,500
Registration fees 2,554 2,446 5,000
Transfer agent fees 3,277 3,223 6,500
Trustees fees and expenses 1,151 1,099 2,250
Amortization of deferred org. expenses 1,608 (1,608) 0
Fund accounting expense 4,033 3,967 8,000
Other 14,634 (12,630) 3,516
---------- ---------- ----------
Total Expenses 76,196 13,033 89,229
---------- ---------- ----------
Less amounts waived (16,255) (13,033) (29,288)
---------- ---------- ----------
Net expenses 59,941 0 59,941
---------- ---------- ----------
Net investment income (15,137) 0 (15,137)
---------- ---------- ----------
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS:
Net realized gain on investments (115,805) 0 (115,805)
Change in net unrealized appreciation on investments (207,898) 0 (207,898)
---------- ---------- ----------
Net realized and unrealized loss on investments (323,703) 0 (323,703)
---------- ---------- ----------
Net decrease in net assets from operations (338,840) 0 (338,840)
========== ========== ==========
</TABLE>
See notes to financial statements.
SB&H Mid Cap Fund
Notes to the Pro Forma Financial Statements
1. Basis of presentation
The Pro Forma Portfolio of Investments, Statement of Assets and
Liabilities and Statement of Operations ( "Pro Forma Statements" ) reflect the
accounts of the Segall Bryant & Hamill Growth and Income Fund at October 31,
1998 for the six month period then ended.
The Pro Forma Statements give effect to the proposed transfer of all
assets and liabilities of the Segall
SF:58206.2
36
<PAGE>
Bryant & Hamill Growth and Income Fund to the SB&H Mid Cap Fund in exchange for
shares of such SB&H Mid Cap Fund.
The Pro Forma Statements should be read in conjunction with the
historical financial statements of the Segall Bryant & Hamill Growth and Income
Fund included in the Statement of Additional Information.
2. Pro Forma Operating Expenses
The Pro Forma Statement of Operations assume similar rates of gross
investment income for the investments of the SB&H Mid Cap Fund. Accordingly, the
gross investment income is equal to the Segall Bryant & Hamill Growth and Income
Fund's gross investment income. Certain expenses have been adjusted to reflect
the expected expenses of the SB&H Mid Cap Fund more closely.
PART C
ADVISORS SERIES TRUST
PART C
OTHER INFORMATION
ITEM 15. INDEMNIFICATION
The response to this item is incorporated by reference to Item 25 of
Part C of Post-Effective Amendment No. 30, filed October 15 1998, to the
Registrant's Registration Statement on Form N-1A, Registration Statement No.
333-42505 (the "Registration Statement").
ITEM 16. EXHIBITS
Exhibit No.
1 Agreement and Declaration of Trust (1)
2 By-laws, as amended. (1)
3 Not Applicable.
4 Form of Agreement and Plan of Reorganization (filed herewith
as Exhibit A to Prospectus/Proxy Statement).
5 Specimen share certificate. (3)
6 Investment Advisory Agreement (2)
7 Distribution Agreement. (2)
8 Not Applicable.
SF:58206.2
37
<PAGE>
9 Custodian Agreement. (3)
10 Rule 12b-1 Distribution Plan. (4)
11 Opinion of Counsel regarding legality of issuance of shares
and other matters. (7)
12 Opinion of Counsel on tax matters. (7)
13(a) Administration Agreement with Investment Company
Administration, LLC. (2)
13(b) Fund Accounting Service Agreement. (2)
13(c) Transfer Agency and Service Agreement. (2)
14 Consent of KPMG Peat Marwick LLP (6)
15 Not Applicable.
16 Power of Attorney (5)
17 Not Applicable
(1) Previously filed with the Registration Statement on Form N-1A (File No.
333-17391) on December 6, 1996, and incorporated herein by this reference.
(2) Previously filed with Pre-Effective Amendment No. 1 to the Registration
Statement on Form N-1A (File No. 333-17391) on January 29, 1997, and
incorporated herein by this reference.
(3) Previously filed with Pre-Effective Amendment No. 2 to the Registration
Statement on Form N-1A (File No. 333-17391) on February 28, 1997, and
incorporated herein by this reference.
(4) Previously filed with Post-Effective Amendment No. 2 to the Registration
Statement on Form N-1A (File No. 333-17391) on May 1, 1997, and
incorporated herein by this reference.
(5) Previously filed with Form N-14 (File No. 333-17391) on December 3, 1998
and incorporated herein by this reference
(6) Filed herewith
(7) To be filed by amendment
(6) To be filed by amendment.
ITEM 17. UNDERTAKINGS.
SF:58206.2
38
<PAGE>
(a) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a prospectus which is
a part of this Registration Statement by any person or party who is deemed to be
an underwriter within the meaning of Rule 145(c) of the Securities Act, the
reoffering prospectus will contain the information called for by the applicable
registration form for reofferings by persons who may be deemed underwriters, in
addition to the information called for by the other items of the applicable
form.
(b) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (a) above will be filed as part of an amendment to the
Registration Statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.
SF:58206.2
39
<PAGE>
EXHIBIT 14
KPMG PEAT MARWICK LLP
4200 Norwest Center
90 South Seventh Street
Minneapolis, MN 55402
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
VAM Institutional Funds, Inc.:
We consent to the use of our present for the financial statements of Segall
Bryant & Hamill Growth and Income Fund, dated June 5, 1998, and to the reference
to our Firm under the heading "EXPERTS" incorporated by reference herein in the
combined registration/ proxy statement on Form N-14.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Minneapolis, Minnesota
December 11, 1998
SF:58206.2
40
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended, the Registrant has
duly caused this Pre-Effective Amendment No. 1 to the Registration Statement on
Form N-14 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix and the State of Arizona on the 14th day of
December, 1998.
ADVISORS SERIES TRUST
By /s/ Eric M. Banhazl*
Eric M. Banhazl
President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form N-14 has been signed below by the following
persons in the capacities on the dates indicated.
Name Title Date
/s/ Eric M. Banhazl* President, Principal December 14, 1998
______________________ Financial Accounting
Eric M. Banhazl Officer, and Trustee
/s/ Walter E. Auch Sr.* Trustee December14, 1998
- - ----------------------
Walter E. Auch, Sr.
/s/ Donald E. O'Connor* Trustee December 14, 1998
- - ----------------------
Donald E. O'Connor
/s/ George T. Wofford III* Trustee December 14, 1998
- - ----------------------
George T. Wofford III
*/s/ Robert H. Wadsworth
- - ----------------------
By: Robert H. Wadsworth
Attorney in Fact
