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Preliminary proxy material for the
information of the SEC only
RIDGEWAY HELMS MILLENNIUM FUND
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
, 1998
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Ridgeway Helms Millennium Fund
303 Twin Dolphin Drive, Suite 530
Redwood Shores, CA 94065
A Special Meeting of Shareholders of Ridgeway Helms Millennium Fund (the
"Fund"), a series of Advisors Series Trust (the "Trust"), will be held at 9:00
a.m. on , 1998 at the offices of the Fund, 303 Twin Dolphin Drive, Suite 530,
Redwood Shores, CA 94065 for the following purpose, which is more fully
described in the accompanying Proxy Statement dated , 1998.
1. To approve or disapprove a proposed Agreement and Plan of
Reorganization and the transactions contemplated thereby, including (a)
the transfer of all of the assets of the Fund, currently a series of
the Trust, to a newly-formed series--the Millennium Growth Fund (the
"Growth Fund") of The Millennium RHIM Funds, Inc. (the "Corporation"),
a newly-created Maryland corporation, in exchange for shares of the
Growth Fund, and the assumption by the Growth Fund of all of the
liabilities of the Fund; and (b) the distribution to Fund shareholders
of shares of the Growth Fund; and, in connection therewith, to
authorize the Fund as the initial sole shareholder of the Growth Fund:
(i) to approve a new investment advisory agreement between the
Corporation on behalf of the Growth Fund and Ridgeway Helms Investment
Management, Inc. (the "Advisor"); (ii) to approve a new distribution
agreement between the Corporation and Ridgeway Helms Securities
Corporation (the "Distributor"); (iii) to elect four directors of the
Corporation, each to hold office until his successor is duly elected
and qualified; and (iv) to ratify or reject the selection of McGladry &
Pullen LLP as independent accountants of the Corporation for its fiscal
year ending ______, 1999; and
2. To transact such other business as may properly come before the
meeting.
Only shareholders of record at the close of business on , 1998 are entitled to
notice of, and to vote at, the meeting.
By Order of the Board of Trustees
, Secretary
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YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWNED ON THE RECORD DATE.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY BALLOT, DATE AND
SIGN IT, AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH IS ADDRESSED FOR YOUR
CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. IN ORDER TO
AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK FOR YOUR
COOPERATION IN MAILING YOUR PROXY PROMPTLY.
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689907.4
<PAGE>
RIDGEWAY HELMS MILLENNIUM FUND
303 TWIN DOLPHIN DRIVE, SUITE 530
REDWOOD SHORES, CA 94065
PROXY STATEMENT
INTRODUCTION
This statement is furnished in connection with the solicitation of
proxies by the Board of Trustees of the Trust on behalf of the Fund for use at a
Special Meeting of Shareholders of the Fund to be held at the offices of the
Fund at 303 Twin Dolphin Drive, Suite 530, Redwood Shores, California 94065 on
________, 1998 at 9 a.m. Such solicitation will be made primarily by the mailing
of this statement and the materials accompanying it. Supplemental solicitations
may be made by mail, telephone, or personal interviews by officers and
representatives of the Fund. The expenses in connection with preparing and
mailing this statement and the material accompanying it, and of such
supplemental solicitations, will be borne by the Advisor. This Proxy Statement
and the accompanying Proxy are first being sent to shareholders on or about
____________, 1998. The Fund's most recent annual report is available upon
request.
There existed ___________ shares of beneficial interest of the Fund
outstanding as of the close of business on _________, 1998, each whole share
being entitled to one vote and each fraction of a share being entitled to a
proportionate fraction of a vote. Only shareholders of record at the close of
business on ___________, 1998 are entitled to vote at the meeting. Any
shareholder may revoke his or her proxy at any time prior to its exercise by a
written notification of such revocation, such notification to include the
shareholder's name and account number, and which must be signed, addressed to
the Fund at 303 Twin Dolphin Drive, Suite 530, Redwood Shores, California 94065,
and received prior to the meeting to be effective, or by signing another proxy
of a later date, or by personally casting his or her vote at the meeting of
shareholders.
The purpose of this Special Meeting of the Shareholders of the Fund is
to consider the approval of the Agreement and Plan of Reorganization providing
for the transfer of all of the assets of the Fund, as a series of the Trust, to
a newly-formed series (the Growth Fund) of the Corporation in exchange for
shares of the Growth Fund and the assumption by the Growth Fund of all of the
liabilities of the Fund, and the distribution to Fund shareholders of shares of
the Growth Fund; and in connection therewith, to authorize the Fund as the
initial sole shareholder of the Growth Fund: (i) to approve a new investment
advisory agreement between the Corporation on behalf of the Growth Fund and the
Advisor; (ii) to approve a new distribution agreement between the Corporation
and the Distributor; (iii) to elect four directors of the Corporation; and (iv)
to ratify the selection of McGladrey & Pullen LLP as the Corporation's
independent accountants. The Trustees of the Trust have approved, and recommend
that the shareholders of the Fund approve the Agreement and Plan of
Reorganization (the "Reorganization") to be effective on or before June 30,
1998. As a result of the Reorganization, the proposed new Investment Advisory
and Distribution Agreements will be substantially identical in all material
respects to the Fund's current Investment Advisory and Distribution Agreements
in effect immediately prior to the Reorganization, except for the dates of
execution and termination. As a result, the Advisor will continue to perform
investment advisory services for the Growth Fund and the Distributor will
continue to sell shares of the Fund after the Reorganization on the same terms
as are in effect immediately before the Acquisition.
Forty (40%) percent of the outstanding shares of the Fund, represented
in person or by proxy, shall be required to constitute a quorum at the meeting.
When a quorum is present, a majority of the outstanding shares normally is
sufficient to pass a proposal. However, for purpose of Proposal 1, in connection
with the approval of a new investment advisory agreement and a new distribution
agreement, the Investment Company Act of 1940 (the "1940 Act") requires that a
"majority" vote be obtained. The percentage required by the 1940 Act that
constitutes a majority is the lesser of (a) 67% or more of the outstanding
shares present at such meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented by proxy; or (B) more
than 50% of the outstanding shares of the Fund. If a quorum is not present at
the meeting, or if a quorum is present but sufficient votes to approve the
Proposal are not received, the persons named as proxies may propose one or more
adjournments of the meeting to permit further solicitation of proxies. In
determining whether to adjourn the meeting, the following factors may be
considered: the nature of the Proposal that is the subject of the meeting, the
percentage of votes actually cast, the percentage of negative votes actually
cast, the nature of any further solicitation and the information to be provided
to shareholders with respect to the reasons for the solicitation. Any
adjournment will require the affirmative vote of a majority of those shares
represented at the meeting in person or by proxy.
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<PAGE>
Any signed proxy will be voted in favor of Proposal 1 unless a choice is
indicated to vote against or to abstain from voting on the Proposal. An
abstention on the Proposal will have the same legal effect as a vote against
such Proposal. Further, the Proposal is considered "discretionary" and brokers
that are record or nominee holders of shares of the Fund who have received no
instructions from their clients have discretion to vote on this matter. Absent
voting by the particular beneficial owners of such shares, such "broker
non-votes" will be considered as votes cast in determining the outcome of the
Proposal.
As of ____________, 1998, the following persons or entities owned as
much as 5% of the Fund's outstanding shares:
Nature of
Name & Address % of Class Ownership
[To Come]
As of ______________, 1998, the officers and Trustees of the Fund
beneficially owned, directly or indirectly (including the power to vote or to
dispose of any shares), less than 1% of the shares of the total outstanding
shares of beneficial interest of the Fund.
PROPOSAL 1. APPROVAL OR DISAPPROVAL OF THE PROPOSED AGREEMENT AND PLAN OF
REORGANIZATION
At a meeting held on March __, 1998, the Board of Trustees of the
Trust, on behalf of the Fund, adopted, subject to shareholder approval, the
Agreement and Plan of Reorganization (the "Plan of Reorganization") whereby the
Fund, currently a series of the Trust, would be reorganized as a series of the
Corporation (referred to herein as the "Reorganization"). A copy of the Plan of
Reorganization is attached as Exhibit A. If the Plan of Reorganization is
approved by the shareholders and consummated, all the assets, liabilities and
operations of the Fund will be assumed by and transferred to the Growth Fund, a
newly created series of the Corporation created for the purpose of succeeding to
the business of the Fund.
In exchange, the Growth Fund will deliver its shares of common stock,
equal in number and type to the full and fractional shares of the Fund
outstanding prior to the Effective Time of the Reorganization. Each shareholder
of record of the Fund will receive a number of shares of the Growth Fund equal
to the number and type of shares of the Fund held at the Effective Time of the
Reorganization and the Growth Fund will establish an open account on its stock
records in the name of each shareholder of the Fund.
In addition, the Plan of Reorganization authorizes the Fund, as the
sole shareholder of the Growth Fund immediately prior to the Reorganization, to
take certain actions without further shareholder involvement. The Fund has been
advised by counsel to the Advisor that no independent shareholder approval is
necessary for any of such actions, which include: (a) approval of the new
Investment Advisory Agreement between the Corporation on behalf of the Growth
Fund and the Advisor; (b) approval of the new Distribution Agreement between the
Corporation and the Distributor; (c) election of four directors of the
Corporation; and (d) ratification of the selection of McGladrey & Pullen LLP as
independent accountants.
Each of these actions is discussed more completely below.
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<PAGE>
The purpose of the Reorganization is to consolidate the Fund (in the
form of the Growth Fund) with another newlyregistered mutual fund, the
Millennium Growth & Income Fund, as well as with future series of the
Corporation to be organized subsequent to the Reorganization, each of which will
be advised by the Advisor. The Advisor expects that by placing the Fund in a
newly-formed family of funds for which the Advisor serves as the investment
advisor to each Fund in the family, shareholders will benefit through the
eventual increase in the number of funds available for an exchange privilege, as
well as a reduction of total expenses and improvement in overall services. The
total expenses for the Growth Fund are projected to be no less than, and subject
to continued growth, lower than the current total expenses of the Fund because
of the benefits to be derived by certain economies of scale connected with the
Growth Fund eventually being a part of a larger fund family for which the
Advisor serves as the investment advisor to each such Fund. Also, the Advisor
expects that with an increased marketing effort, the net asset size of the
Growth Fund will increase over time, thereby spreading fixed costs over an even
larger asset base. There, of course, can be no guarantee that the total expenses
of the Fund will be reduced as a result of the Reorganization. The
Reorganization will also allow the Growth Fund to consolidate both transfer
agency and administration, with one service provider, American Data Services,
Inc. It is anticipated that the Growth Fund will derive efficiencies from this
combination of the transfer agent and administrator.
Following the Reorganization, there will be no material change in the
operations of the Growth Fund from that of the predecessor Fund other than as
stated below. The investment objective, policies and restrictions of the Growth
Fund following the Reorganization will be substantially identical in all
material respects to those of the Fund, other than as stated below. The net
asset value of a share of the Growth Fund will be the same immediately after the
Reorganization as the net asset value of a share of the Fund immediately prior
to the Reorganization, and the Growth Fund will continue to sell and redeem its
shares in the same manner as is set forth in the Fund's prospectus. The Advisor
will continue to manage the Growth Fund's investments and provide other
services, subject to such policies as the Corporation's Board of Directors may
determine, pursuant to a new investment advisory agreement.
The Advisor has agreed to pay all costs associated with the
Reorganization, including the costs associated with the preparation and mailing
of this proxy statement and any proxy solicitation. Therefore, shareholders will
bear none of these costs. In addition, the Reorganization will be a tax-free
transaction as described below.
If the Plan of Reorganization is not approved, the Fund will continue
to operate as a separate series of the Trust and the Trustees may consider
alternative plans.
The Fund has received the opinion of Battle Fowler LLP, counsel to the
Corporation, that the Reorganization pursuant to the Plan of Reorganization will
constitute a tax-free reorganization for federal income tax purposes and will
not affect the federal tax status in the Fund held prior to the Reorganization.
The following table provides a pro forma comparative analysis of
expenses for the Fund and for the Growth Fund (after the proposed
Reorganization). This analysis assumes that the total assets in the Fund and the
Growth Fund for the periods indicated are the approximate current total assets
of the Fund.
-3-
<PAGE>
Pro Forma Comparison of Annual Shareholder Expenses
(based on assets of $10 million)
<TABLE>
<CAPTION>
<S> <C>
Current Expenses of Fund*
(based on December 31, 1997 financial information (unaudited)) As a %of Assets
Advisory Fee .95%
Other Operating Expenses .50%
Total Operating Expense 1.45%
Anticipated Expenses of Series*
(if Proposal 1 is approved) As a % of Assets
Advisory Fee .95%
Other Operating Expenses (estimated) .50%
Total Operating Expenses (estimated) 1.45%
</TABLE>
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*The Advisor currently reimburses the Fund for expenses in excess of 1.45%. The
Advisor has agreed to continue this reimbursement after the Reorganization if
Proposal 1 is approved.
Comparison of Shareholder Transaction Expenses
An investor would pay the following charges when buying or redeeming
shares of the Fund and the Growth Fund.
Current Fund Growth Fund
Sales charge on purchases None None
Sales charge on reinvested dividends None None
Redemption fee None None
Exchange fee None None
12b-1 fee None None
Summary of the Plan of Reorganization. The Reorganization will be
structured as a transfer of assets in a tax-free reorganization. In order to
accomplish the Reorganization, on the closing date the Fund will transfer all of
its assets to the Growth Fund, which will assume all of the Fund's liabilities
and will issue a number and type of its shares of common stock to the Fund equal
to the number and type of the Fund's shares of beneficial interest outstanding
as of the closing date. Immediately thereafter, the Fund will distribute these
shares to its shareholders. Each shareholder of record of the Fund will receive
a number and type of shares of the Growth Fund equal to the number and type of
shares of the Fund held at the Effective Time of the Reorganization and the
Growth Fund will establish on its stock records an open account in the name of
each shareholder of the Fund, representing the number and type of shares of the
Growth Fund due to each shareholder. Fractional shares will be carried to the
third decimal place. Following the Reorganization, new share certificates will
not be issued for the Growth Fund. As soon as practicable after the Effective
Date of the Reorganization, the Fund will be dissolved and its existence will be
terminated.
-4-
<PAGE>
The Plan of Reorganization authorizes the Fund as the sole shareholder
of the Growth Fund, immediately prior to the Reorganization to: (i) approve the
new Investment Advisory Agreement between the Corporation, on behalf of the
Growth Fund and the Advisor; (ii) approve the Distribution Agreement with the
Distributor; (iii) elect four directors of the Corporation; and (iv) ratify the
selection of McGladrey & Pullen LLP as the Corporation's independent
accountants. Each of the Investment Advisory and Distribution Agreements will be
substantially identical in all material respects to the Agreements in effect for
the Fund prior to the Reorganization, except for the dates of execution and
termination. In addition, there will be no increase in the fees paid under such
Agreements. If approved, the Reorganization will become effective on or about
June 30, 1998.
The obligations of the Fund and the Growth Fund under the Plan or
Reorganization are subject to various conditions as stated herein. In order to
provide against unforeseen events, the Reorganization may be terminated or
amended at any time prior to the closing thereof by action of the Board of
Trustees, notwithstanding the approval of the Plan or Reorganization by the
shareholders of the Fund. However, after the Fund's shareholders have approved
the Plan of Reorganization, no amendments may be made that materially adversely
affect the interests of the shareholders of the Fund. The Fund and the Growth
Fund may at any time waive compliance with any of the conditions contained in
the Plan of Reorganization, provided that such waiver does not materially
adversely affect the interests of the shareholders of the Fund.
Temporary Amendment to Investment Restrictions and Operating Policies.
The Fund's present investment restrictions in part preclude it from purchasing
securities of any issuer if such purchase would cause the Fund, with respect to
50% of its assets, to acquire more than 10% of the outstanding securities of any
one issuer or invest for the purpose of exercising control over management of
any company. This restriction cannot be removed or waived without shareholder
approval. Furthermore, the Fund's operating policies (which may be changed
without shareholder approval) also provide, in part, that the Fund will not
invest in the securities of other investment companies or purchase other
investment company's voting securities or make any other investment in other
investment companies. Unless temporarily waived, these investment restrictions
and operating policies might preclude the acquisition by the Fund of more than a
nominal number of shares of the Growth Fund at and/or just prior to Effective
Time of the Reorganization (as contemplated by the Plan of Reorganization) which
is necessary for the Fund's shareholders to vote indirectly to: (i) approve the
Investment Advisory Agreement with the Advisor; (ii) approve the Distribution
Agreement with the Distributor; (iii) elect four directors of the Corporation;
and (iv) ratify the selection of McGladrey & Pullen LLP as the Corporation's
independent accountants. Because the above-noted investment restrictions would
preclude the Fund from carrying out the Reorganization in the manner
contemplated in the Plan of Reorganization, the shareholders of the Fund are
being asked to amend such restrictions temporarily in order to permit the
consummation of the Reorganization.
Approval of the new Investment Advisory Agreement with the Advisor. At
a meeting held on March 13, 1998, the Board of Trustees of the Trust, including
a majority of the Trust's Board of Trustees who are not interested persons of
the Trust, (the "Independent Trustees") approved among other items, the adoption
of a new Investment Advisory Agreement with the Advisor, on behalf of the Growth
Fund. A form of this Investment Advisory Agreement appears at Exhibit B. If
shareholders of the Fund approve this Proposal, the Fund, as sole shareholder of
the Growth Fund, will approve the new Investment Advisory Agreement between the
Corporation, on behalf of the Growth Fund, and the Advisor, which will be
substantially identical in all material respects to the Investment Advisory
Agreement between the Trust, on behalf of the Fund, and the Advisor in effect
immediately prior to the Reorganization.
Approval of Distribution Agreement with the Distributor. At a meeting
held on March 13, 1998, the Board of Trustees of the Trust, including a majority
of the Independent Trustees, also approved, among other items, the applicability
to the Growth Fund of the Distribution Agreement with the Distributor. A copy of
the form of Distribution Agreement appears at Exhibit C. If shareholders approve
this Proposal, the Fund, as the sole shareholder of the Growth Fund, will
approve the Distribution Agreement, which is substantially identical in all
material respects to the current Distribution Agreement applicable to the Fund.
The Administrator. American Data Services, Inc. (the "Administrator")
will serve as the Growth Fund's administrator pursuant to an Administrative
Service Agreement entered into with the Corporation and will provide the Growth
Fund with administrative services, including, but not limited to, preparing
various federal and state regulatory filings, preparing various financial
reports for the Growth Fund to be supplied to the Corporation's Board of
Directors, monitoring the activities of the Growth Fund's custodian, shareholder
servicing agents and accountants and coordinating the preparation and payment of
Growth Fund expenses and the Growth Fund's expense accruals. For its services,
the Administrator receives
-5-
<PAGE>
an annual fee based on the average daily net assets of the Growth Fund and of
other series of the Corporation. The Administrator will be providing
substantially similar services to the Growth Fund and the Corporation that the
Investment Company Administration Corporation currently provides to the Fund and
to the Trust. In addition, the Administrator currently serves as the Transfer
Agent for the Fund and will serve as the Transfer Agent for the Growth Fund, as
well as other series of the Corporation.
Custodian. Star Bank, N.A. will serve as the custodian for the Growth
Fund's assets. Such Bank currently serves as the custodian for the Fund's
assets.
Continuation of shareholder Accounts and Plans. If the Plan of
Reorganization is approved, an account will be established for each shareholder
containing the appropriate number of shares of the Growth Fund. Such account
will be identical in all respects to the account currently maintained for each
shareholder of the Fund. In addition, no further action will be necessary in
order to continue any retirement plan currently maintained on behalf of a
shareholder with respect to Fund shares.
Tax Consequences. The Fund has been provided with an opinion from
Battle Fowler LLP, counsel to the Corporation, that the transaction contemplated
by the Plan of Reorganization will constitute a tax-free reorganization for
federal income tax purposes under Section 368 of the Internal Revenue Code of
1986, as amended. Accordingly, for federal income tax purposes, shareholders
will not recognize gain or loss on their exchange of shares of the Fund for
shares of the Growth Fund, each shareholder's tax basis in the shares of the
Growth Fund received will equal the shareholder's tax basis in the shares of the
Fund exchanged therefor, and each shareholder's holding period in the shares of
the Growth Fund received will include the shareholder's holding period in the
shares of the Fund exchanged, provided the shares of the Fund were held as
capital assets at the time of the exchange. While the Fund is not aware of any
adverse state or local tax consequences of the proposed Reorganization, it has
not made any investigation as to such consequences. Shareholders should consult
their own tax advisers with respect to such matters.
Liability and Indemnification of Officers and Directors. As a general
matter, comparable to the Trust's Declaration of Trust, the Corporation's
Articles of Incorporation permit indemnification of Directors and officers to
the extent consistent with the Maryland law and the federal securities laws.
The Articles of Incorporation further provide that the Directors will
not be liable for errors of judgment or mistakes of fact or law. However,
nothing in the Articles of Incorporation protect a Director against any
liability to which the Director would otherwise be subject by reason of wilful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involving the conduct of his office. The Articles of Incorporation provide for
indemnification by the Corporation of the Directors and officers, except with
respect to any matter as to which any such person did not act in good faith in
the reasonable belief that such person's action was in or not opposed to the
best interests of the Corporation. Such person may not be indemnified against
any liability to the Corporation or its shareholders to which such person would
otherwise be subject by reason of wilful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of such
person's office. The Articles of Incorporation also authorize the purchase of
liability insurance on behalf of Directors and officers. In addition, the Growth
Fund, in the Plan of Reorganization, has agreed to indemnify the Trustees (in
their capacity as Trustees and as officers of the Fund) for a period of two
years after the date of the Reorganization from all liabilities that may arise
in connection with, or as a result of, the Reorganization, the proxy statement
and the proxy solicitation.
Annual Meetings. As a general matter, neither the Trust nor the
Corporation is required to hold regular annual or other meetings of
shareholders. Instead, the By-laws of each of the Trust and the Corporation
provide for shareholder voting only as required under applicable state law, as
the same may be amended from time to time, and the 1940 Act. Delaware and
Maryland law provide that a special meeting of shareholders shall be called upon
the written request of the holders of 10% of a Fund's outstanding shares.
Trustees' Recommendations and Required Vote. With respect to the Fund,
the Board of Trustees recommends that shareholders vote FOR the Plan of
Reorganization providing for the transfer of all of the assets of the Fund to
the Growth Fund, a newly-formed series of the Corporation, in exchange for
shares of the Growth Fund, the assumption by the Growth Fund of all of the
liabilities of the Fund and the distribution to Fund shareholders of the shares
of the Growth Fund. Under the Trust's Declaration of Trust, the affirmative vote
of holders of a majority of the outstanding voting securities (as
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<PAGE>
defined in the 1940 Act) of the Fund entitled to vote thereon is required to
approve the adoption of the Plan of Reorganization.
OTHER MATTERS
As a Delaware business trust, the Trust, and as a Maryland corporation,
the Corporation, is not required, and does not intend, to hold regular annual
meetings. Shareholders of the Fund and, subsequently, shareholders of the Growth
Fund who wish to present proposals at any future shareholder meeting must
present such proposals to the Board of Directors of the Corporation at a
reasonable time prior to the solicitation of any shareholder proxy.
Management does not know of any matters to be presented at this Special
Meeting of Shareholders other than those mentioned in this Proxy Statement. If
any other matters properly come before the meeting, the shares represented by
proxies will be voted with respect thereto in accordance with the best judgment
of the person or persons voting the proxies.
By Order of the Board of Trustees
________________, Secretary
_________________, 1998
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<PAGE>
BY SIGNING AND DATING THE LOWER PORTION OF THIS CARD, YOU AUTHORIZE THE
PROXIES TO VOTE FOR PROPOSAL NO. 1 AS MARKED, OR, IF NOT MARKED TO VOTE, "FOR
THE PROPOSAL AND TO USE THEIR DISCRETION TO VOTE ANY OTHER MATTER AS MAY
PROPERLY COME BEFORE THE MEETING. IF YOU DO NOT INTEND TO PERSONALLY ATTEND THE
MEETING, PLEASE COMPLETE, DETACH AND MAIL THE LOWER PORTION OF THIS CARD AT ONCE
IN THE ENCLOSE ENVELOPE.
RIDGEWAY HELMS MILLENNIUM FUND
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
SPECIAL MEETING OF SHAREHOLDERS - , 1998
THE UNDERSIGNED SHAREHOLDER OF THE RIDGEWAY HELMS MILLENNIUM FUND (THE
"FUND") HEREBY APPOINTS ROBERT A. DOWLETT AND N. JOSEPH NAHAS AND EACH OF THEM,
AS ATTORNEYS AND PROXIES OF THE UNDERSIGNED, WITH POWER OF SUBSTITUTION, TO VOTE
ALL OF THE SHARES OF BENEFICIAL INTEREST OF THE FUND STANDING IN THE NAME OF THE
UNDERSIGNED AT THE CLOSE OF BUSINESS ON ________, 1998 AT THE SPECIAL MEETING OF
SHAREHOLDERS OF THE FUND TO BE HELD AT THE OFFICES OF THE FUND AT 303 TWIN
DOLPHIN DRIVE, SUITE 530, REDWOOD SHORES, CALIFORNIA 94065 AT 9:00 A.M. ON
__________, 1998 AND AT ALL ADJOURNMENTS THEREOF, WITH ALL OF THE POWERS THE
UNDERSIGNED WOULD POSSESS IF THEN AND THERE PERSONALLY PRESENT AND ESPECIALLY
(BUT WITHOUT LIMITING THE GENERAL AUTHORIZATION AND POWER THEREBY GIVEN) TO VOTE
AS INDICATED ON THE PROPOSAL. AS MORE FULLY DESCRIBED IN THE PROXY STATEMENT FOR
THE MEETING, AND VOTE AND ACT ON ANY OTHER MATTER WHICH MAY PROPERLY COME BEFORE
THE MEETING.
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES AND WILL BE VOTED
"FOR" THE PROPOSAL LISTED BELOW UNLESS OTHERWISE INDICATED.
<TABLE>
TO VOTE MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS /X/ KEEP THIS PORTION FOR YOUR RECORDS
- ------------------------------------------------------------------------------------------------------------------------------------
RIDGEWAY HELMS MILLENNIUM FUND
VOTE ON PROPOSAL
<S> <C> <C> <C> <C>
FOR AGAINST ABSTAIN
|_| |_| |_| 1. TO APPROVE OR DISAPPROVE THE PLAN OF REORGANIZATION AS MORE FULLY
DESCRIBED IN THE PROXY STATEMENT.
</TABLE>
================================================================================
- ---------------------------------- -------------------------------------------
SIGNATURE SIGNATURE (JOINT OWNERS) DATE
PLEASE SIGN NAME OR NAMES AS PRINTED ABOVE TO AUTHORIZE THE VOTING OF
YOUR SHARES AS INDICATED ABOVE, WHERE SHARES ARE REGISTERED WITH JOINT OWNERS,
ALL JOINT OWNERS SHOULD SIGN. PERSONS SIGNING AS EXECUTORS, ADMINISTRATORS,
TRUSTEES, ETC. SHOULD SO INDICATE.
-8-
<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION is made as of the day of
June, 1998, by and between ADVISORS SERIES TRUST (the "Trust"), a Delaware
business trust, on behalf of RIDGEWAY HELMS MILLENNIUM FUND (the "Fund") and THE
MILLENNIUM RHIM FUNDS, INC. (the "Corporation"), a Maryland corporation, on
behalf of THE MILLENNIUM GROWTH FUND (the "Growth 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, the Trust will convey, transfer and
deliver to the Corporation 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 Growth Fund, a newly-formed series of the
Corporation. In consideration thereof, the Corporation agrees at the
Closing (i) to assume and pay, to the extent that they exist on or
after the Effective Time 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 Growth Fund; and (ii) to deliver to the Fund full and fractional
shares of common stock of the Growth Fund, $0.001 par value (the
"Shares"), equal in number and type to the number and type of full and
fractional shares of beneficial interest of the Fund, no par value,
outstanding immediately prior to the Effective Time of the
Reorganization.
(b) At the Effective Time of the Reorganization, the Trust
will distribute pro rata to the shareholders of record of the Fund as
of the Effective Time of the Reorganization the Shares of the Growth
Fund received by the Fund pursuant to this Section 2. Each shareholder
of record of the Fund will receive a number and type of Shares of the
Growth Fund equal to the number and type of Shares of the Fund held at
the Effective Time of the Reorganization. Such distribution will be
accompanied by the establishment of an open account on the stock
records of the Corporation in the name of each such shareholder of the
Fund and representing the number and type of Shares due such
shareholder. Fractional
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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 will be aggregated and the total dollars to be
paid out resulting from the redemptions will be set aside by the
Trust's transfer agent. After the Closing, the Corporation's transfer
agent will honor all such pre-Closing redemptions on behalf of the
Trust and its transfer agent.
(d) As soon as practicable after the Effective Time of the
Reorganization, the Trust shall take all necessary steps under Delaware
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 Time 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 Time of the Reorganization").
4. Conditions Precedent
The obligations of the Trust and the Corporation 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 Corporation'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, as amended, and the Investment Company Act
of 1940, as amended (the "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 Corporation, effective upon or before the
Effective Time of the Reorganization, shall be duly registered as an
open-end management investment company under the Act.
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(d) Each party shall have received an opinion from Battle
Fowler 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 Growth 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 of 1986,
as amended (the "Code"); (ii) no gain or loss is recognized by the Fund
upon the transfer of substantially all of its assets to the Growth Fund
in exchange solely for the Shares; (iii) no gain or loss is recognized
by the Growth Fund on receipt of the Fund assets in exchange for the
Growth Fund Shares; (iv) the basis of the assets of the Fund in the
hands of the Growth 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 Growth 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 Growth Fund Shares
solely in exchange for the Fund's shares; (vii) the basis of the Growth
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 (viii) the holding period of the Growth Fund Shares received by the
Fund 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
shareholders on the date of the exchange. Furthermore, notwithstanding
anything herein to the contrary, neither the Growth Fund nor the Fund
may waive the condition set forth in this paragraph Section 4(d).
(e) The Trust shall have received an opinion from Battle
Fowler LLP addressed to the Trust and the Fund, in a form reasonably
satisfactory to the Trust and the Fund, substantially to the effect
that: (i) the Corporation is a duly registered, open-end, management
investment company, and its registration with the SEC as an investment
company under the 1940 Act is in full force and effect and the Growth
Fund is a validly established separate series of the Corporation; (ii)
the Shares to be issued to the Fund and then distributed to the
shareholders of the Fund pursuant to this Agreement are duly registered
under the 1933 Act on the appropriate form, and are duly authorized and
upon such issuance will be validly issued and outstanding, fully paid
and non-assessable; (iii) to such counsel's knowledge, no stop order
suspending the effectiveness thereof has been issued and no proceedings
for that purpose have been instituted or are pending or threatened; and
(iv) Battle Fowler LLP has participated in conference with officers and
other representatives of the Fund and the Growth Fund and the
independent public accountants for the Fund at which the contents of
the proxy statement of the Fund and the prospectus and statement of
additional information of the Growth Fund and related matters were
discussed and, although Battle Fowler LLP does not pass upon nor assume
any responsibility for the accuracy, completeness or fairness of the
statements contained in the proxy statement, the prospectus of the
Growth Fund or the statement of additional information of the Growth
Fund, no facts came to Battle Fowler LLP's attention that would lead it
to believe that either the proxy statement, at the time such proxy
statement became effective and at the date hereof, contained an untrue
statement of a material fact
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or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
prospectus and the statement of additional information of the Growth
Fund, as of its date and at the date hereof, contained an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(f) The Trust has received an opinion from ____________,
Maryland counsel addressed to the Trust and the Fund, in a form
reasonably satisfactory to the Trust and the Fund, substantially to the
effect that: (i) the Corporation is a corporation duly created pursuant
to its Articles of Incorporation, is validly existing and in good
standing under the laws of the State of Maryland, and the Articles of
Incorporation directs the Corporation's directors to manage the affairs
of the Corporation and grants them all powers necessary or desirable to
carry out such responsibility, including administering the Growth
Fund's business as described in the current Prospectus of the Growth
Fund; and (ii) this Agreement has been duly authorized, executed and
delivered by the Corporation on behalf of the Growth Fund and, assuming
due authorization, execution and delivery of this Agreement on behalf
of the Growth Fund, is a valid and binding obligation of the
Corporation, enforceable against the Corporation in accordance with its
terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, arrangement, moratorium and other similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(g) 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.
(h) With respect to the Fund, a vote approving this Agreement
and the Reorganization contemplated hereby, including a temporary
amendment of those of the Fund's investment restrictions that might
otherwise preclude the consummation of the Reorganization, and
liquidation and dissolution of the Fund, shall have been adopted by at
least a majority of the outstanding shares of beneficial interest of
the Fund entitled to vote at an annual or special meeting.
(i) With respect to the Growth Fund, the Directors of the
Corporation shall have taken the following action at a meeting duly
called for such purposes:
(1) the approval of the Investment Advisory Agreement
between the Corporation on behalf of the Growth Fund, and
Ridgeway Helms Investment Management, Inc.;
(2) the approval of the Distribution Agreement
between the Corporation and Ridgeway Helms Securities
Corporation;
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(3) the ratification of the selection of McGladrey &
Pullen LLP as independent certified public accountants for the
Corporation;
(4) the election of four directors for the
Corporation;
(5) the authorization of the issuance by the
Corporation prior to the Effective Time of the Reorganization,
of one or more Shares of the Growth 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 stockholder of the
Growth Fund; and
(7) the authorization of the issuance by the
Corporation of Shares at the Effective Time of the
Reorganization in exchange for the Fund's assets pursuant to
the terms and provisions of this Agreement.
(j) 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 Growth
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 Distribution Agreement;
(iii) approve the selection of McGladrey &
Pullen LLP as independent certified
public accountants for the
Corporation; and
(iv) elect four directors for the
Corporation.
(k) With respect to the Fund, the shareholders of the Fund
shall have voted to approve its reorganization into the Growth 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 Trustees of the Trust 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.
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(l) The Trust shall have received a letter from McGladrey &
Pullen, LLP addressed to the Trust substantially to the effect that the
transfer of any unamortized organization cost currently recorded on the
books of the Fund to the Growth Fund is in compliance with Generally
Accepted Accounting Principles and does not violate (i) any federal
securities law and (ii) any rule and regulation of the Commission.
(m) All accrued and unpaid expenses of the Fund, including all
administrative, legal and other expenses owed by the Fund or Ridgeway
Helms Investment Management, Inc. to the Trust 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 the Trust 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 Growth Fund or Ridgeway Helms Investment Management, Inc.,
whether or not the Reorganization is consummated.
6. Indemnification
Ridgeway Helms Investment Management, Inc., its successors or assigns,
the Corporation and the Growth Fund each agree to indemnify the Trust, the Fund,
its trustees (in their capacity as 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 Growth Fund, the Boards of Trustees of
the Trust or the Board of Directors of the Corporation, 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.
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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 the Trust and the Corporation 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 California.
IN WITNESS WHEREOF, each of the Trust and the Corporation 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.
ADVISORS SERIES TRUST, a Delaware
business trust, on behalf of The
Ridgeway Helms Millennium Fund
----------------------------------------
ATTEST:
- --------------------------------
Secretary
THE MILLENNIUM RHIM FUNDS, INC, a
Maryland corporation, on behalf of The
Millennium Growth Fund
-----------------------------------------
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ATTEST:
- --------------------------------------
Secretary
Accepted and agreed to as to Sections 5 and 6 only:
RIDGEWAY HELMS INVESTMENT MANAGEMENT, INC.
By:___________________________
(Name)
(Title)
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