BENESCH 2300 BP America Building
FRIEDLANDER 200 Public Square
COPLAN & Cleveland, Ohio 44114-2378
ARONOFF LLP (216) 363-4500
Fax (216) 363-4588
Michael J. Meaney Writer's Direct Dial Number
(216) 363-4436
November 13, 1997
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
Attention: Filing Desk
Re: MaxFund Trust - Registration Statement on Form N-1A
Ladies and Gentlemen:
On behalf of MaxFund's Trust (the "Trust"), we are filing a Registration
Statement on Form N-1A for the purpose of registering the shares of the Trust
under the Securities Act of 1933.
The filing fee in the amount of $500 has been paid separately by wire transfer.
Also, a Form N-8A Notification of Registration Pursuant to Section 8(a) of the
Investment Company Act of 1940 is being filed concurrently herewith.
The enclosed Registration Statement is substantially similar to the Registration
Statements of Maxus Income Fund, Maxus Equity Fund and Maxus Laureate Fund, all
of which are registered open-end investment companies having the same investment
adviser as that of the Trust. Accordingly, we request that the enclosed
Registration Statement be reviewed on an expeditited basis. The enclosed
Registration Statement of the Trust differs materially from the Registration
Statements of Maxus Income Fund, Maxus Equity Fund and Maxus Laureate Fund only
with respect to the following sections:
<PAGE>
Securities and Exchange Commission
November 13, 1997
Page 2
November 11, 1997 2:07pm -- -- DEW
CLE2: 17035\6 -- 266814 Ver1
1. The sections of the Prospectus entitled HIGHLIGHTS, FEE TABLE,
INVESTMENT OBJECTIVES AND MANAGEMENT TECHNIQUES, INVESTMENT POLICIES
AND RESTRICTIONS, RISKS AND OTHER CONSIDERATIONS, the subheadings under
HOW TO PURCHASE SHARES entitled Investor Shares, Institutional Shares
and Price of Shares, the subheading under INVESTMENT MANAGEMENT
entitled Distribution Plan (Investor Shares Only) and GENERAL
INFORMATION.
2. The sections of the Statement of Additional Information entited
INVESTMENT OBJECTIVE AND POLICIES, MANAGEMENT OF THE FUND, and
COMPENSATION TABLE.
Please contact me at 216/363-4436 with any questions or comments.
Very truly yours,
Michael J. Meaney
Enclosure
<PAGE>
File No. ________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. ___ [_]
Post-Effective Amendment No. ___ [_]
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. ___ [_]
MAXFUND TRUST
(Exact name of registrant as specified in charter)
28601 Chagrin Boulevard, Suite 500, Cleveland,
Ohio 44122 (Address of principal executive
offices)
Registrant's Telephone Number: 216-292-3434
Richard A. Barone, 28601 Chagrin Boulevard, Suite 500, Cleveland, Ohio 44122
(Name and address of agent for service)
Copy to:
Michael J. Meaney, Esq.
Benesch, Friedlander, Coplan & Aronoff LLP
2300 BP America Building, 200 Public Square, Cleveland, Ohio 44114
Approximate date of proposed public offering: As soon as practicable after the
effective date of the Registration Statement.
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant has
elected to register an indefinite number of shares of beneficial interest. The
amount of the registration fee pursuant to Rule 24f-2 of the Investment Company
Act of 1940 is $500.
The Registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
MAXFUND TRUST
Registration Statement on Form N-1A
CROSS REFERENCE SHEET
Part A
Item No. Caption Location
- -------- -------- --------
1. Cover Page Cover Page
2. Synopsis Highlights
3. Condensed Financial Information Not Applicable
4. General Description of Investment Objective and
Registrant Management Techniques, General
Information
5. Management of the Fund Investment Management
6. Capital Stock and Other Securities General Information
7. Purchase of Securities Being Offered Purchase of Shares
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings None
Part B
Item No. Caption Location
- -------- ------- --------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History General Information and
History
13. Investment Objectives and Policies Investment Objectives and
Policies
14. Management of the Fund Management of the Fund
15. Control Persons and Principal Ownership of Shares
Holders of Securities
16. Investment Advisory and Other Investment Advisory and Other
Services Services
<PAGE>
17. Brokerage Allocation Brokerage Allocation
18. Capital Stock and Other Securities Capital Stock and Other
Securities
19. Purchase, Redemption and Pricing Purchase, Redemption and
of Securities Being Offered Pricing of Securities Being
Offered
20. Tax Status Tax Status
21. Underwriters Distributor
22. Calculations of Performance Data Performance
23. Financial Statements Financial Statements
Part C
Information required to be included in Part C is set forth under the
appropriate Item, as numbered, in Part C to this Registration Statement.
<PAGE>
MAXUS OHIO HEARTLAND FUND The Tower at Erieview, 36th Floor
MAXUS AGGRESSIVE VALUE FUND 1301 East Ninth Street
Cleveland, Ohio 44114
(216) 687-1000
Maxus Ohio Heartland Fund and Maxus Aggressive Value Fund (the "Funds") are two
separate diversified portfolios of MaxFund Trust, an open-end management
investment company (the "Trust").
Maxus Ohio Heartland Fund has an investment objective of obtaining a high total
return (a combination of income and capital appreciation). Under normal
circumstances, at least 80% of the value of this Fund's total assets will
consist of equity securities of companies headquartered in the State of Ohio.
Maxus Aggressive Value Fund has an investment objective of obtaining capital
appreciation. Under normal circumstances, at least 80% of the value of this
Fund's total assets will consist of equity securities of companies whose equity
securities have a total market value of not less than $10,000,000 or more than
$200,000,000.
By this Prospectus, each Fund is offering Investor Shares and Institutional
Shares. Investor Shares are offered to the general public. Institutional Shares
are offered to certain institutions and other specified investors. See "How to
Purchase Shares." Investor Shares and Institutional Shares are identical, except
as to minimum investment requirements and the services offered to and expenses
borne by each class.
This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Investors should read this
Prospectus and retain it for future reference. Additional information about the
Funds has been filed with the Securities and Exchange Commission (the "SEC") in
a Statement of Additional Information dated the same date as this Prospectus and
is available upon request and without charge by calling the Funds at (216)
687-1000. Such additional information is hereby incorporated by reference into
this Prospectus.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTUS/January __, 1998
Investors are advised to read this Prospectus and to retain it for future
reference.
<PAGE>
HIGHLIGHTS
Investment Objectives. Each Fund is a diversified fund. The investment objective
of Maxus Ohio Heartland Fund is to obtain a high total return (a combination of
income and capital appreciation). The investment objective of Maxus Aggressive
Value Fund is to obtain capital appreciation. No assurance can be given that
either Fund will achieve its objective. See "Investment Objectives and
Management Techniques."
No Sales Charge. Each Fund sells and redeems its shares at net asset value
without any front-end sales charges or redemption charges. Investor Shares of
each Fund are subject to a plan for using as much as .50% of net assets annually
to aid the distribution of its shares. See "Distribution Plan (Investor Shares
Only)."
Liquidity. Each Fund continuously offers and redeems shares at the net asset
value next computed after receipt by the Fund's Transfer Agent of a purchase
order or redemption request in proper form. See "How to Purchase Shares" and
"How to Redeem Shares."
Minimum Investment. For Investor Shares, the minimum initial investment is
$1,000, with subsequent minimum investments of $100. For Institutional Shares,
the minimum initial investment is $1,000,000, with subsequent minimum
investments of $10,000. See "How to Purchase Shares." Each Fund has the right to
redeem the shares in an account and pay the proceeds to the shareholder if,
because of shareholder redemptions, the value of the account drops below $1,000
in the case of Investor Shares or $1,000,000 in the case of Institutional
Shares. See "How to Redeem Shares."
Dividends. Each Fund intends to pay dividends at least once annually to
shareholders. Unless otherwise directed, all dividends will be automatically
reinvested in additional shares. See "Dividends, Distributions and Taxes."
Investment Adviser. Maxus Asset Management Inc. ("MAM" or the "Adviser") is the
investment adviser for each Fund. Its annual fee is 1% of the first $150,000,000
of the Fund's net assets and .75% of net assets in excess of $150,000,000. This
fee is higher than that paid by most other investment companies. Since 1976 MAM
has been an investment adviser to individuals, retirement plans, corporations
and foundations. MAM is controlled by Richard A. Barone, Chairman of each Fund.
See "Investment Management."
Distributor. Shares of each Fund are offered exclusively by Maxus Securities
Corp ("MSC"), an NASD broker-dealer, on a best efforts basis. MSC is controlled
by Richard A. Barone, Chairman of the Trust. See "Other Information Concerning
Purchase of Shares" and "Distribution Plan (Investor Shares Only) ."
Risk Factors. Neither of the Funds is intended to provide a balanced investment
program to meet all requirements of every investor. The prices of equity
securities fluctuate based on changes in a company's activities and financial
condition and in overall market and financial conditions. There are special
risks associated with investments in the smaller companies in which each Fund
will invest. Also, since Maxus Ohio Heartland Fund concentrates its investments
in the State of Ohio, its assets may be at greater risk because of economic,
political or regulatory risks associated with that state.
<PAGE>
FEE TABLE
Annual Fund Operating Expenses (as a percentage of average net assets)
Maxus Ohio Maxus Aggressive
Heartland Fund Value Fund
Investor Institutional Investor Institutional
Class Class Class Class
Management Fees 1.00% 1.00% 1.00% 1.00%
12b-1 Fees 0.50% 0.00% 0.50% 0.00%
Other Expenses* 0.45% 0.45% 0.45% 0.45%
Total Fund Operating
Expenses* 1.95% 1.45% 1.95% 1.45%
* Based on estimated expenses for the current fiscal year.
The 12b-1 fee in the foregoing table is an asset-based sales charge as
defined in the Rules of Fair Practice of the National Association of Securities
Dealers (the "Rules"). The existence of this charge may cause long-term
shareholders to pay more in total sales charges than the economic equivalent of
the maximum front-end sales charges permitted under those Rules.
A shareholder who requests that the proceeds of a redemption be sent by
wire transfer will be charged for the cost of such wire, which is $10.00 as of
the date of this Prospectus (subject to change without notice).
Example 1 year 3 years
------ -------
You would pay the following expenses on a $1,000
investment in Investor Shares of the Funds,
assuming (1) 5% annual return and (2) redemption
at the end of each time period:
Maxus Ohio Heartland Fund $20 $61
Maxus Aggressive Value Fund $20 $61
<PAGE>
Example 1 year 3 years
------ -------
You would pay the following expenses on a $1,000
investment in Institutional Shares of the Funds,
assuming (1) 5% annual return and (2) redemption
at the end of each time period:
Maxus Ohio Heartland Fund $15 $46
Maxus Aggressive Value Fund $15 $46
The purpose of the foregoing table is to assist you in understanding
the various costs and expenses that an investor in any Fund will bear, directly
or indirectly. The Example set forth in the foregoing table should not be
considered a representation of actual or expected expenses or returns. Actual
expenses or returns may be greater or lesser than those shown.
INVESTMENT OBJECTIVES AND MANAGEMENT TECHNIQUES
Maxus Ohio Heartland Fund.
The investment objective of Maxus Ohio Heartland Fund is to obtain a
high total return (a combination of capital appreciation and income). This
objective is a fundamental policy of this Fund and may not be changed without
approval of a majority of the Fund's shares.
In seeking its objective, under normal conditions, this Fund will
invest at least 80% of its total assets in equity securities of companies
headquartered in the State of Ohio. Equity securities are common stocks and
securities convertible or exchangeable into common stocks. While investments may
be made in all types and sizes of companies headquartered in Ohio, the primary
focus of this Fund will be to invest in small and mid-sized companies, many of
which may be traded in the over-the-counter market. However, the Fund will
generally not invest in companies having annual revenues of less than
$25,000,000.
Under normal conditions, the Fund also may invest up to 20% of its
total assets in high-quality commercial paper (i.e., rated A-1 or A-2 by
Standard & Poor's) and other money market instruments, investment grade
corporate debt securities (i.e., rated BBB or better by Standard & Poor's),
preferred stock and equity securities of companies not headquartered in Ohio. In
addition, when the Adviser believes that market conditions warrant a temporary
defensive posture, the Fund may invest without limitation in high-quality
commercial paper and other money market instruments as described above. Please
refer to Appendix A for a description of these ratings.
<PAGE>
Maxus Aggressive Value Fund
The investment objective of Maxus Aggressive Value Fund is to obtain
capital appreciation. This objective is a fundamental policy of this Fund and
may not be changed without approval of a majority of the Fund's shares.
In seeking its objective, under normal conditions, the Fund will invest
at least 80% of its total assets in equity securities of companies whose equity
securities have a total market value of not less than $10,000,000 or more than
$200,000,000 as of the date of the investment. Equity securities are common
stocks and securities convertible or exchangeable into common stocks. The
primary focus of this Fund will be to invest in companies of this size which the
Adviser believes have businesses and/or assets which have a value in excess of
the current market price of the company's equity securities. In making this
determination, the Adviser will use one or a combination of the following
techniques: (1) balance sheet analysis, (2) cash flow analysis, and (3) analysis
of the likelihood of success of an effort to restructure the company's business.
In addition, the Adviser will consider the purchase or sale of the company's
shares by insiders, other sophisticated investors or the company itself. The
above techniques are intended to identify undervalued companies rather than to
identify potential acquisition candidates.
Under normal conditions, the Fund also may invest up to 20% of its
total assets in high-quality commercial paper (i.e., rated A-1 or A-2 by
Standard & Poor's) and other money market instruments, investment grade
corporate debt securities (i.e., rated BBB or better by Standard & Poor's),
preferred stock and equity securities of companies having a market value of more
than $200,000,000. In addition, when the Adviser believes that market conditions
warrant a temporary defensive posture, the Fund may invest without limitation in
high-quality commercial paper and other money market instruments as described
above. Please refer to Appendix A for a description of these ratings.
Portfolio Turnover
The Funds are not restricted with regard to portfolio turnover and will
make changes in their investment portfolios from time to time as business and
economic conditions and market prices may dictate and their respective
investment policies may require. It is estimated that the portfolio turnover
rate generally will not exceed 50% for Maxus Ohio Heartland Fund and 150% for
Maxus Aggressive Value Fund. A high rate of portfolio turnover in any year will
increase brokerage commissions paid and could result in high amounts of realized
investment gain subject to the payment of taxes by shareholders. Any realized
net short-term investment gain will be taxed to shareholders as ordinary income.
See "Dividends, Distributions and Taxes" below.
INVESTMENT POLICIES AND RESTRICTIONS
Each Fund has adopted certain fundamental policies which may not be
changed without the approval of the holders of a majority of the Fund's
outstanding voting securities (as defined in the 1940 Act). Certain of these
policies are detailed below, while other policies are set forth in the Statement
of Additional Information.
<PAGE>
Neither Maxus Ohio Heartland Fund nor Maxus Aggressive Value Fund may:
(1) invest more than 5% of the value of its total assets in the
securities of any one issuer (except obligations issued or guaranteed
by the United States Government, its agencies and instrumentalities);
(2) acquire more than 10% of the outstanding voting securities
of any one issuer;
(3) invest more than 25% of the value of such Fund's total
assets in securities of companies in a particular industry (except
obligations issued or guaranteed by the United States Government, its
agencies and instrumentalities).
Changes in values of particular Fund assets or the assets of a Fund as
a whole will not cause a violation of the investment restrictions so long as
percentage restrictions are observed by the Fund at the time it purchases any
security. Other investment policies are discussed in the Statement of Additional
Information under the heading "Investment Policies and Restrictions."
RISKS AND OTHER CONSIDERATIONS
Maxus Ohio Heartland Fund and
Maxus Aggressive Value Fund
Neither of the Funds is intended to provide a balanced investment
program to meet all requirements of every investor. No assurance can be given
that either of the Funds will achieve its investment objective.
The prices of equity securities fluctuate based on changes in a
company's activities and financial condition and in overall market and financial
conditions. The smaller companies in which each Fund will invest are especially
sensitive to these factors and therefore may be subject to greater share price
fluctuations than other companies. Also, securities of these smaller companies
are often less liquid, thus possibly limiting the ability of the Fund to dispose
of such securities when the Adviser deems it desirable to do so. As a result of
these factors, securities of these smaller companies may expose shareholders of
each Fund to above average risk.
Both Funds may also invest in debt securities. In general, the prices
of debt securities rise when interest rates fall, and vice versa. Debt
securities have varying degrees of quality and varying levels of sensitivity to
changes in interest rates. Longer-term bonds are generally more sensitive to
interest rate changes than short-term bonds. Investment-grade debt securities
are medium- and high-quality securities. Some, however, possess speculative
characteristics and may be more sensitive to economic changes and to changes in
the financial condition of issuers.
<PAGE>
Maxus Ohio Heartland Fund
Since the Maxus Ohio Heartland Fund concentrates its investments in the
State of Ohio, its assets may be at greater risk because of economic, political
or regulatory risks associated with the State. This Fund also is subject to the
additional risk that only a limited number of attractive securities meeting the
Fund's investment criteria may be available.
PERFORMANCE
From time to time, the Funds may advertise performance data represented
by a cumulative total return or an average annual total return. Total returns
are based on the overall or percentage change in value of a hypothetical
investment in a Fund and assume all of the Fund's dividends and capital gain
distributions are reinvested. A cumulative total return reflects the Fund's
performance over a stated period of time. An average annual total return
reflects the hypothetical annually compounded return that would have produced
the same cumulative total return if the Fund's performance had been constant
over the entire period. Because average annual returns tend to smooth out
variations in the Fund's returns, it should be recognized that they are not the
same as actual year-by-year results.
Performance may be compared to well-known indices such as the Dow Jones
Industrial Average or alternative investments such as Treasury Bills. Also, the
Funds may include published editorial comments compiled by independent
organizations such as Lipper Analytical Services or Morningstar, Inc.
All performance information is historical in nature and is not intended
to represent or guarantee future results. The value of Fund shares when redeemed
may be more or less than their original cost.
Further information about the performance of each of the Funds is
contained in the Funds' Annual Report to Shareholders which may be obtained from
the Fund without charge.
HOW TO PURCHASE SHARES
By this Prospectus, each Fund is offering Investor Shares and
Institutional Shares. Investor Shares and Institutional Shares are identical,
except as to minimum investment requirements and the services offered to and
expenses borne by each class.
Investor Shares
Investor Shares may be purchased by any investor without a sales
charge. A minimum initial investment of $1,000 is required to open an Investor
Shares account with subsequent minimum investments of $100. Investment minimums
may be waived at the discretion of each Fund.
<PAGE>
Institutional Shares
Institutional Shares may be purchased without a sales charge by (1)
financial institutions, such as banks, trust companies, thrift institutions,
mutual funds or other financial institutions, acting on their own behalf or on
behalf of their qualified fiduciary accounts, employee benefit or retirement
plan accounts or other qualified accounts, (2) securities brokers or dealers
acting on their own behalf or on behalf of their clients, (3) directors or
employees of the Funds or of the Adviser or its affiliated companies or by the
relatives of those individuals or the trustees of benefit plans covering those
individuals. These requirements for the purchase of Institutional Shares may be
waived in the sole discretion of the Funds.
A minimum initial investment of $1,000,000 is required to open an
Institutional Shares account with subsequent minimum investments of $10,000.
Investment minimums may be waived at the discretion of each Fund.
Shareholders Accounts
When a shareholder invests in a Fund, Maxus Information Systems Inc.,
the Transfer Agent for each Fund, will establish an open account to which all
full and fractional shares (to three decimal places) will be credited, together
with any dividends and capital gains distributions, which are paid in additional
shares unless the shareholder otherwise instructs the Transfer Agent. Stock
certificates will be issued for full shares only when requested in writing. Each
shareholder is notified of the status of his account following each purchase or
sale transaction.
Initial Purchase
The initial purchase may be made by check or by wire in the following
manner:
By Check. The Account application which accompanies this Prospectus should be
completed, signed, and, along with a check for the initial investment payable to
MaxFund Trust, mailed to: Maxus Information Systems Inc., The Tower at Erieview,
36th Floor, 1301 East Ninth Street, Cleveland, Ohio 44114.
By Wire. In order to expedite the investment of funds, investors may advise
their bank or broker to transmit funds via Federal Reserve Wire System to: Star
Bank, N.A. Cinti/Trust, ABA #0420-0001-3, F/F/C Account No. 19-6201 Maxus Mutual
Funds DDA 483617213 (Star Bank Trust). Also provide the shareholder's name and
account number. In order to obtain this needed account number and receive
additional instructions, the investor may contact, prior to wiring funds, Maxus
Information Systems Inc., at (216) 687-1000. The investor's bank may charge a
fee for the wire transfer of funds.
Subsequent Purchases.
Investors may make additional purchases in the following manner:
<PAGE>
By Check. Checks made payable to MaxFund Trust should be sent, along with the
stub from a previous purchase or sale confirmation, to Maxus Information Systems
Inc., The Tower at Erieview, 36th Floor, 1301 East Ninth Street, Cleveland, Ohio
44114.
By Wire. Funds may be wired by following the previously discussed wire
instructions for an initial purchase.
By Telephone. Investors may purchase shares up to an amount equal to 3 times the
market value of shares held in the shareholder's account in a Fund on the
preceding day for which payment has been received, by telephoning Maxus
Information Systems Inc., at (216) 687-1000 and identifying their account by
number. Shareholders wishing to available themselves of this privilege must
complete a Telephone Purchase Authorization Form which is available from the
Fund. A confirmation will be mailed and payment must be received within 3
business days of date of purchase. If payment is not received within 3 business
days, the Fund reserves the right to redeem the shares purchased by telephone,
and if such redemption results in a loss to the Fund, redeem sufficient
additional shares from the shareholder's account to reimburse the Fund for the
loss. Payment may be made by check or by wire. The Adviser has agreed to hold
the Fund harmless from net losses resulting from this service to the extent, if
any, not reimbursed from the shareholder's account. This telephone purchase
option may be discontinued without notice.
Systematic Investment Plan
The Systematic Investment Plan permits investors to purchase shares of
either Fund at monthly intervals. Provided the investor's bank or other
financial institution allows automatic withdrawals, shares may be purchased by
transferring funds from the account designated by the investor. At the
investor's option, the account designated will be debited in the specified
amount, and shares will be purchased once a month, on or about the 15th day.
Only an account maintained at a domestic financial institution which is an
Automated Clearing House member may be so designated. Investors desiring to
participate in the Systematic Investment Plan should call the Transfer Agent at
(216) 687-1000 to obtain the appropriate forms. The Systematic Investment Plan
does not assure a profit and does not protect against loss in declining markets.
Price of Shares.
The price paid for shares of a certain class of a Fund is the net asset
value per share of such class of such Fund next determined after receipt by the
Transfer Agent of properly identified purchase funds, except that the price for
shares purchased by telephone is the net asset value per share next determined
after receipt of telephone instructions. Net asset value per share is computed
for each class of each Fund as of the close of business (currently 4:00 P.M.,
New York time) each day the New York Stock Exchange is open for trading and on
each other day during which there is a sufficient degree of trading in such
Fund's investments to affect materially net asset value of its redeemable
securities. For purposes of pricing sales and redemptions, net asset value per
share of a series or class is calculated by determining the total value of the
assets of such series or class less all debts, obligations and liabilities
allocable to such series or class, and dividing such amount by the number of
shares of such series or class outstanding.
<PAGE>
For purposes of computing the net asset value per share, securities
listed on a national securities exchange or on the NASDAQ National Market System
will be valued on the basis of the last sale of the date on which the valuation
is made or, in the absence of sales, at the closing bid price. Over-the-counter
securities will be valued on the basis of the bid price at the close of business
on each day or, if market quotations are not readily available, at fair value as
determined in good faith by the Board of Trustees. Unless the particular
circumstances (such as an impairment of the credit-worthiness of the issuer)
dictate otherwise, the fair value of short-term securities with maturities of 60
days or less shall be their amortized cost. All other securities and other
assets of each such Fund will be valued at their fair value as determined in
good faith by the Board of Trustees.
Other Information Concerning Purchase of Shares.
Each Fund reserves the right to reject any order, to cancel any order
due to non-payment and to waive or lower the investment minimums with respect to
any person or class of persons. If an order is canceled because of non-payment
or because your check does not clear, you will be responsible for any loss that
the Fund incurs. If you are already a shareholder, the Fund can redeem shares
from your account to reimburse it for any loss. The Adviser has agreed to hold
each Fund harmless from net losses to that Fund resulting from the failure of a
check to clear to the extent, if any, not recovered from the investor. For
purchases of $50,000 or more, each Fund may, in its discretion, require payment
by wire or cashier's or certified check.
Shares of each Fund are offered exclusively, on a best efforts basis,
by the Funds' Distributor, Maxus Securities Corp ("MSC"), an NASD broker-dealer.
Purchases of the Fund's shares through MSC will be transmitted promptly to the
Transfer Agent so that the investor's purchase order receives the net asset
value next determined following receipt of the order by MSC. The address of MSC
is The Tower at Erieview, 36th Floor, 1301 East Ninth Street, Cleveland, Ohio
44114. MSC, which is controlled by Richard A. Barone, Chairman of each Fund,
receives for its services as Distributor an annual distribution fee of .50% of
average net assets of Investor Shares. See "Distribution Plan (Investor Shares
Only)." Certain employees of MSC may receive compensation under the Distribution
Plan.
HOW TO REDEEM SHARES
All shares of each class of each Fund offered for redemption will be
redeemed at the net asset value per share of such class of that Fund next
determined after receipt of the redemption request, if in good order, by the
Transfer Agent. See "Price of Shares." Because the net asset value of each
Fund's shares will fluctuate as a result of changes in the market value of
securities owned, the amount a stockholder receives upon redemption may be more
or less than the amount paid for the shares. Redemption proceeds will be mailed
to the shareholder's registered address of record or, if $5,000 or more, may be
transmitted by wire, upon request, to the shareholder's pre-designated account
at a domestic bank. The shareholder will be charged for the cost of such wire.
If shares have been purchased by check and are being redeemed, redemption
proceeds will be paid only after the check used to make the purchase has cleared
(usually within 15 days after payment by check). This delay can be avoided if,
at the time of purchase, the shareholder provides payment by certified or
cashier's check or by wire transfer.
<PAGE>
Redemption by Mail.
Shares may be redeemed by mail by writing directly to the Funds'
Transfer Agent, Maxus Information Systems Inc., The Tower at Erieview, 36th
Floor, 1301 East Ninth Street, Cleveland, Ohio 44114. The redemption request
must be signed exactly as the shareholder's name appears on the registration
form, with the signature guaranteed, and must include the account number. If
shares are owned by more than one person, the redemption request must be signed
by all owners exactly as the names appear on the registration.
If a shareholder is in possession of the stock certificate, these
certificates must accompany the redemption request and must be endorsed as
registered with a signature guarantee. Additional documents may be required for
registered certificates owned by corporations, executors, administrators,
trustees or guardians. A request for redemption will not be processed until all
of the necessary documents have been received in proper form by the Transfer
Agent. A shareholder in doubt as to what documents are required should contact
Maxus Information Systems Inc. at (216) 687-1000.
You should be able to obtain a signature guarantee from a bank,
broker-dealer, credit union (if authorized under state law), securities exchange
or association, clearing agency or savings association. A notary public is not
an acceptable guarantor. A Fund may in its discretion waive the signature
guarantee in certain instances.
Redemption By Telephone.
Shares may be redeemed by telephone by calling Maxus Information
Systems Inc. at (216) 687-1000 between 9:00 A.M. and 4:00 P.M. eastern time on
any day the New York Stock Exchange is open for trading. An election to redeem
by telephone must be made on the initial application form or on other forms
prescribed by the Fund which may be obtained by calling the Funds at (216)
687-1000. This form contains a space for the shareholder to supply his own four
digit identification number which must be given upon request for redemption. A
Fund will not be liable for following instructions communicated by telephone
that the Fund reasonably believes to be genuine. If a Fund fails to employ
reasonable procedures to confirm that instructions communicated by telephone are
genuine, the Fund may be liable for any losses due to unauthorized or fraudulent
instructions. Any changes or exceptions to the original election must be made in
writing with signature guaranteed, and will be effective upon receipt by the
Transfer Agent. The Transfer Agent and each Fund reserve the right to refuse any
telephone instructions and may discontinue the aforementioned redemption option
without notice. The minimum telephone redemption is $1,000.
<PAGE>
Other Information Concerning Redemption.
Each Fund reserves the right to take up to seven days to make payment
if, in the judgment of the Fund's Investment Adviser, such Fund could be
affected adversely by immediate payment. In addition, the right of redemption
for a Fund may be suspended or the date of payment postponed (a) for any period
during which the NYSE is closed (other than for customary week-end and holiday
closings), (b) when trading in the markets that the Fund normally utilizes is
restricted, or when an emergency, as defined by the rules and regulations of the
SEC, exists, making disposal of that Fund's investments or determination of its
net asset value not reasonably practicable, or (c) for any other periods as the
SEC by order may permit for protection of that Fund's shareholders.
Due to the high cost of maintaining accounts, each Fund has the right
to redeem, upon not less than 30 days written notice, all of the shares of any
shareholder if, through redemptions, the shareholder's account has a net asset
value of less than $1,000 in the case of Investor Shares or $1,000,000 in the
case of Institutional Shares. A shareholder will be given at least 30 days
written notice prior to any involuntary redemption and during such period will
be allowed to purchase additional shares to bring his account up to the
applicable minimum before the redemption is processed.
SYSTEMATIC WITHDRAWAL PLAN
Shareholders who own shares of a Fund valued at $15,000 or more may
elect to receive a monthly or quarterly check (or direct deposit to the
shareholder's checking account) in a stated amount (minimum amount is $100 per
month or quarter). Shares will be redeemed at net asset value as may be
necessary to meet the withdrawal payments. If withdrawal payments exceed
reinvested dividends and distributions, the investor's shares will be reduced
and eventually depleted. A withdrawal plan may be terminated at any time by the
shareholder or the applicable Fund. Costs associated with a withdrawal plan are
borne by the applicable Fund. Additional information regarding systematic
withdrawal plans may be obtained by calling Maxus Information Systems Inc. at
(216) 687-1000.
INVESTMENT MANAGEMENT
Trustees and Officers.
The business and affairs of each Fund are managed under the direction
of the Board Trustees of the Trust, as required by Ohio law. The day-to-day
operations of each Fund are conducted through or under the direction of its
officers. By virtue of the responsibilities assumed by MAM as investment adviser
(see below), the Funds have no executive employees other than their officers,
each of whom is employed by MAM or its affiliates and none of whom devotes full
time to the affairs of any Fund. No officer, director or employee of MAM or any
of its affiliates receives any compensation from any Fund for serving as a
Trustee or officer of such Fund. Each Fund pays each Trustee who is not an
officer, director or employee of MAM or any of its affiliates a fee of $100 per
meeting attended and reimburses each such Trustee for travel and out-of-pocket
expenses.
<PAGE>
The Investment Adviser.
Each Fund has retained as its investment adviser Maxus Asset Management
Inc ("MAM" or the "Adviser"), The Tower at Erieview, 36th Floor, 1301 East Ninth
Street, Cleveland, Ohio 44114, an investment management organization founded in
1976. The Adviser is actively engaged in providing discretionary investment
management services to institutional and individual clients and is registered
under the Investment Advisers Act of 1940. The Adviser has not been sponsored,
recommended or approved, nor have its abilities or qualifications been passed
upon, by the Securities and Exchange Commission or any other government agency.
MAM is a wholly owned subsidiary of Resource Management Inc ("RMI"), an
Ohio corporation with interests primarily in the financial services industry.
RMI also owns all of the shares of Maxus Securities Corp ("MSC"), the NASD
broker/dealer through which shares of each Fund are being offered. Mr. Richard
A. Barone is the president and majority shareholder of RMI and, therefore, is
deemed to be in control of MAM and MSC.
Subject to the supervision and direction of each Fund's Trustees, MAM,
as investment adviser, manages each Fund's portfolio in accordance with the
stated policies of that Fund. MAM makes investment decisions for each Fund and
places the purchase and sale orders for portfolio transactions. In addition, MAM
or its affiliates furnishes office facilities and clerical and administrative
services, pays the salaries of all officers and employees who are employed by
both it and the Funds and, subject to the direction of the Trust's Board of
Trustees, is responsible for the overall management of the business affairs of
each Fund, including the provision of personnel for recordkeeping, the
preparation of governmental reports and responding to shareholder
communications.
Denis J. Amato is the person primarily responsible for the management
of the portfolio of the Maxus Ohio Heartland Fund. Mr. Amato has been Chief
Investment Officer of MAM since 1997. Previously, he was Managing Director of
Gelfand Partners Asset Management since 1991.
Richard A. Barone is the person primarily responsible for the
management of the portfolio of Maxus Aggressive Value Fund. Mr. Barone has been
President of MAM since 1976.
Advisory Fee.
The Adviser receives from each Fund as compensation for its services to
each Fund an annual fee of 1% on the first $150,000,000 of each Fund's net
assets, and 0.75% of each Fund's net assets in excess of $150,000,000. This fee
is higher than that paid by most other investment companies. The fee is paid
monthly and calculated on the basis of that month's net assets.
<PAGE>
Expenses Borne by Each Fund.
Each Fund pays all expenses not assumed by the Adviser, including
brokerage fees and commissions, fees of Trustees not affiliated with MAM,
expenses of registration of the Fund and of the shares of the Fund with the
Securities and Exchange Commission and the various states, charges of the
custodian, dividend and transfer agent, outside auditing and legal expenses,
liability insurance premiums on property or personnel (including officers and
trustees), maintenance of trust existence such as the filing of reports required
by state law, any taxes payable by the Fund, interest payments relating to Fund
borrowings, costs of preparing, printing and mailing registration statements,
prospectuses, periodic reports and other documents furnished to shareholders and
regulatory authorities, fees and expenses of legal counsel, and costs of
printing share certificates, portfolio pricing services and shareholder
meetings, reimbursements to RMI for organizational expenses, and costs pursuant
to each Fund's plan of distribution described below.
RMI, the parent company of the Adviser, paid the organizational
expenses of each Fund incurred prior to the initial offering of that Fund's
shares, including expenses involved in preparing, printing and mailing
registration statements and prospectuses to potential investors. Each Fund
agreed to reimburse RMI for such expenses. Such reimbursed expenses were
deferred and are being amortized by each Fund on a straightline basis over a
period of five years from the date of commencement of operations.
Distribution Plan (Investors Shares Only).
Under a plan adopted by the Board of Trustees pursuant to Rule 12b-1
under the 1940 Act (the "Plan"), each Fund pays MSC a shareholder servicing and
distribution fee at the annual rate of .50% of the average daily net assets of
the Investor Shares of such Fund. Such fee will be used by MSC to make payments
for administration, shareholder services and distribution assistance, including,
but not limited to (i) compensation to securities dealers and other persons and
organizations ("Service Organizations") for providing distribution assistance
with respect to Investor Shares, (ii) compensation to Service Organizations for
providing administration, accounting and other shareholder services with respect
to Investor Shares, and (iii) otherwise promoting the sale of Investor Shares,
including paying for the preparation of advertising and sales literature and the
printing and distribution of such materials to prospective investors. The fees
paid to MSC under the Plan are payable without regard to actual expenses
incurred. Third parties also may charge fees to their clients who are beneficial
owners of Investor Shares in connection with their clients' accounts. These fees
would be in addition to any amounts which may be received by them from MSC under
the Plan.
Execution of Portfolio Transactions.
Orders for transactions in portfolio securities for each Fund are
placed by the Adviser with securities broker-dealers with the objective of
obtaining the best available price, investment services and execution. Cost of
execution (commissions) is an important consideration but may not be the
overriding determinant. Based upon this consideration the Adviser makes
substantial use of the services of MSC, an affiliate of each Fund and of the
Adviser, but is not required to do so.
<PAGE>
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund will declare and pay, at least annually, dividends to
shareholders of substantially all of its net investment income, if any, earned
during the year from investments, and will distribute net realized capital
gains, if any, once each year. All dividends and distributions will be
reinvested automatically at net asset value in additional shares of a Fund
unless the shareholder has notified such Fund in writing of his election to
receive distributions in cash. As a result of the application of the
Distribution Plan to Investor Shares only, the amount of dividends on
Institutional Shares will exceed the amount of dividends on Investors Shares.
Each Fund will be treated as a separate entity for federal income tax
purposes. Each Fund intends to qualify continually as a regulated investment
company under Subchapter M of the Internal Revenue Code (the "Code"). Such
qualification removes from the Fund any liability for federal income taxes upon
the portion of its income distributed to shareholders and makes federal income
tax upon such distributed income generated by such Fund's investments the sole
responsibility of the shareholders. Continued qualification requires each Fund
to distribute to its shareholders each year substantially all of its income and
capital gains. In addition, amounts not distributed on a timely basis in
accordance with a calendar year distribution requirement are subject to a
nondeductible four percent (4%) excise tax. To prevent imposition of the excise
tax each Fund must distribute for each calendar year an amount equal to the sum
of (1) at least 98% of its calendar year net ordinary income, (2) at least 98%
of the excess of its capital gains over capital losses (adjusted for certain
ordinary losses) realized during the one-year period ending December 31 of such
year, and (3) 100% of any undistributed net ordinary income and net capital
gains for previous years. A distribution will be treated as paid on December 31
of the calendar year if it is declared by the Fund in December of that year with
a record date in December and paid by the Fund during January of the following
calendar year. Such distributions will be taxable to shareholders in the
calendar year in which the distributions are declared, rather than the calendar
year in which the distributions are received. Each Fund will notify shareholders
of the tax status of dividends and distributions.
Any dividend or distribution paid by a Fund has the effect of reducing
the net asset value per share on the ex-dividend date by the amount of the
dividend or distribution. Therefore, a dividend or distribution paid shortly
after a purchase of shares by an investor would represent, in substance, a
return of capital to the shareholder, even though subject to income taxes.
Each Fund may also, from time to time, pay dividends in excess of net
income and net realized capital gains. Any such excess dividends would
constitute a non-taxable return of capital to the shareholder.
<PAGE>
Depending on the residence of the shareholder for tax purposes,
distributions also may be subject to state and local taxes, including
withholding taxes. Shareholders should consult their own tax advisers as to the
tax consequences of ownership of shares of a Fund in their particular
circumstances.
In accordance with the Code, each Fund may be required to withhold a
portion of dividends or redemptions or capital gains paid to a shareholder and
remit such amount to the Internal Revenue Service if the shareholder fails to
furnish the Fund with a correct taxpayer identification number, if the
shareholder fails to supply the Fund with a tax identification number
altogether, if the investor fails to make a required certification that his
taxpayer identification number is correct and that he is not subject to backup
withholding, or if the Internal Revenue Service notifies the Fund to withhold a
portion of such distributions from a shareholder's account.
GENERAL INFORMATION
The Funds are separate, diversified portfolios of MaxFund Trust (the
"Trust"). The Trust is an open-end management investment company, organized as a
business trust under the laws of the State of Ohio by a Declaration of Trust
dated November 7, 1997. The Declaration of Trust provides for an unlimited
number of authorized shares of beneficial interest, which may, without
shareholder approval, be divided into an unlimited number of series of such
shares, and which are presently divided into two series of shares, one for Maxus
Ohio Heartland Fund and one for Maxus Aggressive Value Fund. Each share
represents an equal proportionate interest in a Fund with other shares of the
same series and class, and is entitled to such dividends and distributions out
of the income earned on the assets belonging to that Fund as are declared at the
discretion of the Trustees. All consideration received by the Trust for shares
of one of the Funds and all assets in which such consideration is invested will
belong to that Fund and will be subject to the liabilities relating thereto.
Shareholders are entitled to one vote per share (with proportional
voting for fractional shares) on such matters as shareholders are entitled to
vote. Shareholders vote in the aggregate and not by series or class on all
matters except that (i) shares shall be voted by individual series or class when
required by the 1940 Act or when the Trustees have determined that the matter
affects only the interests of a particular series or class, and (ii) only the
holders of Investor Shares will be entitled to vote on matters submitted to
shareholder vote with regard to the Distribution Plan applicable to such class.
As used in this Prospectus and in the Statement of Additional
Information, a "vote of a majority of the outstanding Shares" of the Trust or a
particular Fund means the affirmative vote, at a meeting of shareholders duly
called, of the lesser of (a) 67% or more of the votes of shareholders of the
Trust or such Fund present at such meeting at which the holders of more than 50%
of the votes attributable to the shareholders of record of the Trust or such
Fund are represented in person or by proxy, or (b) the holders of more than 50%
of the outstanding votes of shareholders of the Trust or such Fund.
<PAGE>
Although the Trust is not required to hold annual meetings of the
shareholders, shareholders holding at least 10% of the Trust's outstanding
shares have the right to call a meeting to elect or remove one or more of the
Trustees of the Trust.
Upon issuance and sale in accordance with the terms of this Prospectus,
each share will be fully paid and non-assessable. Shares of the Funds have no
preemptive, subscription or conversion rights and are redeemable as set forth
under "How to Redeem Shares." The Declaration of Trust also provides that
shareholders shall not be subject to any personal liability for the acts or
obligations of such Fund and that every agreement, obligation or instrument
entered into or executed by such Fund shall contain a provision to the effect
that the shareholders are not personally liable thereunder. Although each Fund
is offering its own shares, it is possible that one Fund may become liable for
any misstatement in this Prospectus about one of the other Funds.
In order to provide the initial capital for the Trust, MAM has
purchased a total of (i) 10,000 shares of Maxus Ohio Heartland Fund at $10.00
per share for an aggregate purchase price of $100,000 and (ii) 20,000 shares of
Maxus Aggressive Value Fund at $5.00 per share for an aggregate purchase price
of $100,000. As long as MAM owns more than 25% of the Trust's shares, it will be
deemed to be in "control" of the Trust as that term is defined in the 1940 Act.
Star Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45201, is the
custodian for each Fund's securities and cash. Maxus Information Systems Inc.
("MIS"), The Tower at Erieview, 36th Floor, 1301 East Ninth Street, Cleveland,
Ohio 44114, is each Fund's Transfer, Redemption and Dividend Distributing Agent.
MIS is a subsidiary of RMI, the parent company of the Adviser.
McCurdy & Associates C.P.A.'s, Inc., 27955 Clemens Road, Westlake, Ohio
44145, have been appointed as independent accountants for the Funds.
Benesch, Friedlander, Coplan & Aronoff LLP, 2300 BP America Building,
200 Public Square, Cleveland, Ohio 44114, is legal counsel to the Funds and to
the Adviser.
Shareholder inquiries should be directed to the Secretary of the Trust
at The Tower at Erieview, 36th Floor, 1301 East Ninth Street, Cleveland, Ohio
44114.
<PAGE>
APPENDIX A
Description of bond and Commercial Paper Ratings*
Standard & Poor's Corporation
Bonds
AAA: Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation. Capacity to pay interest and repay principal is
extremely strong.
AA: Bonds rated AA have very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.
A: Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effect of
changes in circumstances and economic conditions than bonds in the higher rated
categories.
BBB: Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
bonds in this category than for the bonds in higher rated categories.
BBB, B, CCC and CC: Bonds rated BB, B, CCC and CC are regarded on
balance as predominantly speculative with respect to capacity to pay interest
and repay principal in accordance with the terms of the obligation. BB indicates
the lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.
Commercial Paper
A-1: Commercial paper rated A-1 indicates that the degree of safety
regarding timely payment is very strong.
A-2: Commercial paper rated A-2 indicates that the capacity for timely
payment is strong. However, the relative degree of safety is not as overwhelming
as for issues designated A-1.
- ---------------------------
*As described by Standard & Poor's Corporation.
<PAGE>
No dealer, salesman, or other person has been authorized to give any information
or to make any representations, other than those contained in this Prospectus,
and, if given or made, such other information or representations must not be
relied upon as having been authorized by the Funds or the Adviser. This
Prospectus does not constitute an offering in any state in which such offering
may not lawfully be made.
TABLE OF CONTENTS Page
HIGHLIGHTS.....................................................................2
FEE TABLE......................................................................3
INVESTMENT OBJECTIVES AND MANAGEMENT TECHNIQUES................................4
INVESTMENT POLICIES AND RESTRICTIONS...........................................5
RISKS AND OTHER CONSIDERATIONS.................................................6
PERFORMANCE....................................................................7
HOW TO PURCHASE SHARES.........................................................7
HOW TO REDEEM SHARES..........................................................10
SYSTEMATIC WITHDRAWAL PLAN....................................................11
INVESTMENT MANAGEMENT.........................................................12
DIVIDENDS, DISTRIBUTIONS AND TAXES............................................16
GENERAL INFORMATION...........................................................17
<PAGE>
Investors are advised to read
this Prospectus and to retain
it for future reference.
MAXUS OHIO HEARTLAND FUND
MAXUS AGGRESSIVE VALUE FUND
PROSPECTUS
January ___, 1998
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
January __, 1998
MAXUS OHIO HEARTLAND FUND
MAXUS AGGRESSIVE VALUE FUND
The Tower at Erieview, 36th Floor
1301 East Ninth Street
Cleveland, Ohio 44114
(216) 687-1000
Maxus Ohio Heartland Fund and Maxus Aggressive Value Fund (the "Funds")
are separate diversified portfolios of MaxFund Trust, an open-end management
investment company. The investment objective of Maxus Ohio Heartland Fund is to
obtain a high total return (a combination of capital appreciation and income).
The investment objective of Maxus Aggressive Value Fund is to obtain capital
appreciation. This Statement of Additional Information relating to the Funds is
not a prospectus and should be read in conjunction with the Funds' prospectus. A
copy of the Funds' prospectus can be obtained from the Fund's distributor, Maxus
Securities Corp, The Tower at Erieview, 36th Floor, 1301 East Ninth Street,
Cleveland, Ohio 44114, telephone number (216) 687-1000. The prospectus to which
this Statement relates is dated the same date as this Statement of Additional
Information.
The date of this Statement of Additional Information is January ___,
1998.
<PAGE>
TABLE OF CONTENTS
Caption Page Location in Prospectus
General Information and History 1 General Information
Investment Objective and Policies 1 Investment Objectives
and Management Techniques
Management of the Fund 5 Investment Management
Ownership of Shares 6 Not Applicable
Investment Advisory and Other 7 Investment Management
Services
Brokerage Allocation 9 Execution of Portfolio
Transactions
Capital Stock and Other Securities 10 General Information
Purchase, Redemption and Pricing of 10 How to Purchase Shares/
Securities Being Offered How to Redeem Shares
Determination of Net Asset Value 11 How to Purchase Shares
Tax Status 11 Dividends, Distributions
and Federal Taxes
Distributor 12 Investment Management
Financial Statements 15 Not Applicable
<PAGE>
GENERAL INFORMATION AND HISTORY
Maxus Ohio Heartland Fund and Maxus Aggressive Value Fund (the "Funds")
are diversified portfolios of MaxFund Trust (the "Trust"), an open-end
management investment company. Maxus Ohio Heartland Fund seeks a high total
return (a combination of income and capital appreciation). Maxus Aggressive
Value Fund seeks capital appreciation. The Trust was organized as a business
trust under the laws of the State of Ohio pursuant to a Declaration of Trust
dated November 7, 1997.
Investment Objective and Policies
The investment objective and policies of each Fund are briefly
described in the Prospectus under the heading "Investment Objective And
Management Techniques." Each Fund has also adopted the following fundamental
investment policies and restrictions in addition to the fundamental investment
policies described in the Prospectus under the subheading "Investment
Restrictions." These policies cannot be changed without approval by the holders
of a majority of the outstanding voting securities of such Fund (as defined in
the Prospectus under "GENERAL INFORMATION"). Each Fund may not:
1. Invest in securities of other registered investment
companies, except by purchase in the open market involving only
customary brokerage commissions, or except as part of a merger,
consolidation, reorganization or acquisition; or
2. Invest in securities of any registered closed-end
investment company, if immediately after such purchase or acquisition
such Fund would own more than 3% of the total outstanding voting stock
of such closed-end company.
3. Invest more than 10% of the Fund's net assets in securities
for which market quotations are not readily available and repurchase
agreements maturing in more than seven days.
4. Lend money or securities, provided that the making of
interest-bearing demand deposits with banks and the purchase of debt
securities in accordance with its objective and policies are not
prohibited.
5. Borrow money except for temporary or emergency purposes
from banks (but not for the purpose of purchase of investments) and
then only in an amount not to exceed 5% of the Fund's net assets; or
pledge the Fund's securities or receivables or transfer or assign or
otherwise encumber them in an amount exceeding the amount of the
borrowings secured thereby.
6. Make short sales of securities, or purchase any securities
on margin except to obtain such short-term credits as may be necessary
for the clearance of transactions.
7. Write (sell) put or call options, combinations thereof or
similar options; nor may it purchase put or call options if more than
5% of the Fund's net assets would be invested in premiums on put and
call options, combinations thereof or similar options.
<PAGE>
8. Purchase or retain the securities of any issuer if any of
the officers or Trustees of the Trust or its investment adviser owns
beneficially more than 1/2 of 1% of the securities of such issuer and
together own more than 5% of the securities of such issuer.
9. Invest for the purpose of exercising control or management
of another issuer.
10. Invest in commodities or commodity futures contracts or in
real estate, although it may invest in securities which are secured by
real estate and securities of issuers which invest or deal in real
estate.
11. Invest in interests in oil, gas or other mineral
exploration or development programs, although it may invest in the
securities of issuers which invest in or sponsor such programs.
12. Underwrite securities issued by others except to the
extent the Fund may be deemed to be an underwriter, under the federal
securities laws, in connection with the disposition of portfolio
securities.
13. Issue senior securities as defined in the Act.
14. Purchase securities subject to restrictions on disposition
under the Securities Act of 1933.
If a percentage restriction is adhered to at the time of investment, a later
increase or decrease in percentage beyond the specified limit resulting from a
change in values or net assets will not be considered a violation.
The Fund will not invest more than 5% of its assets in repurchase
agreements. A repurchase agreement is an instrument under which the Fund
acquires ownership of an obligation but the seller agrees, at the time of sale,
to repurchase the obligation at a mutually agreed-upon time and price. The
resale price is in excess of the purchase price and reflects an agreed-upon
market rate unrelated to the interest rate on the purchased security. The Fund
will make payments for repurchase agreements only upon physical delivery or
evidence of book entry transfer to the account of the custodian or bank acting
as agent. In the event of bankruptcy or other default of a seller of a
repurchase agreement, the Fund could experience both delays in liquidating the
underlying securities and losses including: (a) possible decline in the value of
the underlying securities during the period while the Fund seeks to enforce its
rights thereto; (b) possible subnormal levels of income and lack of access to
income during this period; and (c) expenses of enforcing its rights.
MANAGEMENT OF THE FUND
The following table provides biographical information with respect to
each current Trustee and officer of the Trust. Each Trustee who is or may be
deemed to be an "interested person" of the Fund, as defined in the Act, is
indicated by an asterisk. Each Trustee of the Fund is also a Trustee of Maxus
Income Fund, Maxus Equity Fund and Maxus Laureate Fund, three other open-end
management investment companies.
<PAGE>
Name and Address Position Held Principal Occupation(s)
With the Fund During Past 5 Years
- ---------------- ------------- -------------------
Richard A. Barone* Chairman, Treasurer President of Maxus Securities
28601 Chagrin Boulevard and Trustee Corp (broker-dealer), Maxus
Cleveland, Ohio 44122 Asset Management Inc.
(Investment adviser) and
Resource Management Inc.
(financial services)
Denis J. Amato Trustee Chief Investment Officer,
Suite 740 Maxus Asset Management, Inc.
1801 East Ninth Street (investment adviser) since
Cleveland, Ohio 44114 1997; previously, Managing
Director, Gelfand Partners
Asset Management (investment
adviser)
N. Lee Dietrich Trustee Retired; formerly Vice
7090 Morley Road President, Ohio Convenient
Painesville, Ohio 44077 Food Mart, Inc.
Sanford Fox, D.D.S. Trustee Endodontist
6789 Ridge Road, #301
Parma, Ohio 44129
Burton D. Morgan Trustee Chairman, Morgan Bank (bank);
Park Place President, Basic Search, Inc.
10 West Streetsboro Road (venture capital); Chairman,
Hudson, Ohio 44236 Multi-Color Corporation
(printing); Chairman Morgan
Funshares, Inc. (mutual fund)
Murlan J. Murphy, Jr. Trustee Independent Investor
11249 lake Forest Drive
Chesterland, Ohio 44026
Michael A. Rossi, C.P.A. Trustee Certified Public Accountant
6559 Wilson Mills Road
Highland Heights, Ohio 44143
<PAGE>
Robert A. Schenkelberg, Jr.* Trustee President, Entrust Inc.
One Commerce Park (financial planning)
Suite 300
23200 Chagrin Boulevard
Beachwood, Ohio 44122
James Onorato Vice President Vice President, Resource
28601 Chagrin Boulevard Management Inc.
Cleveland, Ohio 44122
Robert W. Curtin Secretary Senior Vice President and
28601 Chagrin Boulevard Secretary, Maxus Securities
Cleveland, Ohio 44122 Corp; formerly Executive Vice
President, Roulston & Company,
Inc.
No officer, director or employee of Maxus Asset Management Inc. ("MAM"
or the "Investment Adviser") or of any parent or subsidiary receives any
compensation from the Trust for serving as an officer or Trustee of the Trust.
Each Trustee who is not an interested person of MAM will receive from each Fund
the following fees for each Board or shareholders meeting attended: $100 per
meeting if net assets of such fund are under $10,000,000; $200 per meeting if
net assets of such Fund are between $10,000,000 and $50,000,000; or $300 per
meeting if net assets of such Fund are over $50,000,000. The estimated fees
payable to the Trustees for the current fiscal year, which are the only
compensation or benefits payable to Trustees, are summarized in the following
table:
COMPENSATION TABLE
Aggregate Compensation Total Compensation From All
Name of Trustee from each Fund* Maxus Funds Paid to Trustees*
Ohio Heartland Aggressive Value
Denis J. Amato $ 0 $ 0 $ 0
Richard A. Barone $ 0 $ 0 $ 0
N. Lee Dietrich $800 $800 $3,600
Sanford A. Fox, D.D.S. $800 $800 $3,600
Burton D. Morgan $800 $800 $3,600
Murlan J. Murphy $800 $800 $3,600
<PAGE>
Michael A. Rossi $800 $800 $3,600
Robert A. Schenkelberg $ 0 $ 0 $ 0
*Estimated fees for 1998.
OWNERSHIP OF SHARES
As of December ___, 1997, all of the outstanding shares of each class
of each Fund were owned by Maxus Asset Management, Inc., The Tower at Erieview,
36th Floor, 1301 East Ninth Street, Cleveland, Ohio 44114. A shareholder who
beneficially owns, directly or indirectly, more than 25% of the Fund's voting
securities may be deemed a "control person" (as defined in the 1940 Act) of the
Fund. Maxus Management, Inc. is controlled by Richard A. Barone, the Chairman of
the Fund.
INVESTMENT ADVISORY AND OTHER SERVICES
Maxus Asset Management, Inc. ("MAM"), each Fund's investment adviser,
is a wholly-owned subsidiary of RMI. MAM is registered as an investment adviser
under the Investment Advisers Act of 1940. MAM has not been sponsored,
recommended or approved, nor have its abilities or qualifications been passed
upon, by the Securities and Exchange Commission or any other governmental
agency.
As compensation for MAM's services rendered to each Fund, such Fund
pays a fee, computed and paid monthly, at an annual rate of 1% of the average
value of the first $150,000,000 of the Fund's daily net assets and .75% of
average daily net assets in excess of $150,000,000. This fee is higher than that
paid by most other investment companies.
MAM acts as investment adviser to the Fund pursuant to an Investment
Advisory and Administration Agreement dated November 19, 1997. Subject to the
supervision and direction of the Board of Trustees, MAM, as investment adviser,
manages the Fund's portfolio in accordance with the stated policies of the Fund.
MAM makes investment decisions for each Fund and places the purchase and sale
orders for portfolio transactions. In addition, MAM furnishes office facilities
and clerical and administrative services, and pays the salaries of all officers
and employees who are employed by both it and each Fund and, subject to the
direction of the Board of Trustees, is responsible for the overall management of
the business affairs of the Fund, including the provision of personnel for
recordkeeping, the preparation of governmental reports and responding to
shareholder communications.
<PAGE>
Other expenses are borne by each Fund and include brokerage fees and
commissions, fees of Trustees not affiliated with MAM, expenses of registration
of the Fund and of the shares of the Fund with the Securities and Exchange
Commission (the "SEC") and the various states, charges of the custodian,
dividend and transfer agent, outside auditing and legal expenses, liability
insurance premiums on property or personnel (including officers and trustees),
maintenance of business trust existence, any taxes payable by the Fund, interest
payments relating to Fund borrowings, costs of preparing, printing and mailing
registration statements, prospectuses, periodic reports and other documents
furnished to shareholders and regulatory authorities, reimbursement to RMI for
organizational expenses, including costs of printing share certificates,
portfolio pricing services and Fund meetings, and costs incurred pursuant to the
Distribution Plan (Investor Shares only) described below.
The Investment Advisory and Administration Agreement is subject to
annual approval as to each Fund by (i) the Board of Trustees or (ii) vote of a
majority (as defined in the Act) of the outstanding voting securities of such
Fund, provided that in either event the continuance is also approved by a
majority of the Trustees who are not "interested persons" (as defined in the
Act) of such Fund or MAM by vote cast in person at a meeting called for the
purpose of voting on such approval. The Board of Trustees, including a majority
of the Trustees who are not "interested persons," voted to approve the
Investment Advisory and Administration Agreement at a meeting held on November
19, 1997. The Investment Advisory and Administration Agreement is terminable as
to either Fund without penalty, on not less than 60 days' notice, by the Board
of Trustees or by vote of the holders of a majority of such Fund's shares or,
upon not less than 90 days' notice, by MAM. The Investment Advisory and
Administration Agreement will terminate automatically in the event of its
assignment.
Each Fund has a Plan of Distribution (the "Plan") pursuant to Rule
12b-1 under the Act, pursuant to which the Fund pays Maxus Securities Corp
("MSC") up to .50% of average net assets of Investor Shares annually for the
costs of activities intended to result in the sale of Investor Shares. See
"Investment Management --Distribution Plan" in the Fund's Prospectus.
The Trustees believe that the Plan will benefit each Fund and its
holders of Investor Shares. Among these benefits are: (1) reductions in the per
share expenses of the Fund as a result of increased assets in the Fund; (2)
reductions in the cost of executing portfolio transactions and the possible
ability of the Investment Adviser in some cases to negotiate lower purchase
prices for securities, due to the potentially larger blocks of securities which
may be traded by the Fund as its net assets increase in size; and (3) a more
predictable flow of cash which may provide investment flexibility in seeking the
Fund's investment objective and may better enable the Fund to meet redemption
demands without liquidating portfolio securities at inopportune times.
<PAGE>
The Trust has entered into an Administration Agreement with Maxus
Information Systems Inc. ("MIS"), The Tower at Erieview, 36th Floor, 1301 East
Ninth Street, Cleveland, Ohio 44114, pursuant to which MIS has agreed to act as
each Fund's Transfer, Redemption and Dividend Disbursing Agent and as
Administrator of Plans of each Fund. As such, MIS maintains each Fund's official
record of shareholders and is responsible for crediting dividends to
shareholders' accounts. In consideration of such services, the Fund has agreed
to pay MIS an annual fee, paid monthly, equal to $6.75 per shareholder account
(with a monthly minimum of $775) plus out-of-pocket expenses. In addition, each
Fund has entered into an Accounting Services Agreement with MIS, pursuant to
which MIS has agreed to provide portfolio pricing and related services, for the
payment of an annual fee of $17,400 for the first $25,000,000 in net assets,
$8,500 for the next $25,000,000 in net assets and $4,750 for each additional
$25,000,000 in net assets, plus out-of-pocket expenses.
Star Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45201, serves as
the Fund's custodian. As custodian, Star Bank maintains custody of the Fund's
cash and portfolio securities.
McCurdy & Associates C.P.A.'s, Inc., independent certified public
accountants located at 27955 Clemens Road, Westlake, Ohio 44145, has been
selected as auditors for each Fund. In such capacity, McCurdy & Associates
C.P.A.'s, Inc. periodically reviews the accounting and financial records of each
Fund and examines its financial statements.
BROKERAGE ALLOCATION
Decisions to buy and sell securities for each Fund are made by MAM
subject to the overall supervision and review by the Board of Trustees.
Portfolio security transactions for each Fund are effected by or under the
supervision of MAM.
Transactions on stock exchanges involve the payment of negotiated
brokerage commissions. There is generally no stated commission in the case of
securities traded in the over-the-counter markets, but the price of those
securities includes an undisclosed commission or markup. The cost of securities
purchased from underwriters includes an underwriting commission or concession,
and the prices at which securities are purchased from and sold to dealers
include a dealer's markup or markdown.
In executing portfolio transactions and selecting brokers and dealers,
it is each Fund's policy to seek the best overall terms available. The
Investment Advisory and Administration Agreement provides that, in assessing the
best overall terms available for any transaction, MAM shall consider the 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, and the reasonableness of the commission, if any, for the
specific transaction and on a continuing basis. In addition, the Investment
Advisory and Administration Agreement authorizes MAM, in selecting brokers or
dealers to execute a particular transaction, and, in evaluating the best overall
terms available, to consider the brokerage and research services (as those terms
are defined in Section 28(e) of the Securities Exchange Act of 1934) provided to
the Fund and/or other accounts over which MAM exercises investment discretion.
<PAGE>
The Board of Trustees periodically reviews the commissions paid by each
Fund to determine if the commissions paid over representative periods of time
were reasonable in relation to the benefits inuring to the Fund. It is possible
that certain of the services received will primarily benefit one or more other
accounts for which investment discretion is exercised. Conversely, a Fund may be
the primary beneficiary of services received as a result of portfolio
transactions effected for other accounts. MAM's fee under the Investment
Advisory and Administration Agreement is not reduced by reason of MAM's
receiving such brokerage and research services.
Under the Act, a mutual fund may not pay brokerage commissions to an
affiliate which exceed the usual and customary broker's commissions. A
commission is deemed as not exceeding the usual and customary broker's
commission if (i) the commission is reasonable and fair compared to the
commission received by other brokers in connection with comparable transactions
involving similar securities being purchased or sold during a comparable period
of time and (ii) the Board of Trustees, including a majority of the Trustees who
are not interested persons of the mutual fund, have adopted procedures
reasonably designed to provide that such commission is consistent with the
above-described standard, review these procedures annually for their continuing
appropriateness and determine quarterly that all commissions paid during the
preceding quarter were in compliance with these procedures.
The Fund's Board of Trustees has determined that any portfolio
transaction for a Fund, including in certain instances over-the-counter
purchases and sales, may be effected through MSC if, in MAM's judgment, the use
of MSC is likely to result in price and execution at least as favorable as those
of other qualified brokers, and if, in the transaction, MSC charges the Fund a
commission rate consistent with those charged by MSC to comparable unaffiliated
customers in similar transactions. Each quarter, the Trustees review a report
comparing the commissions charged each Fund by MSC to the commissions which
would have been charged for the same transactions by a national discount
brokerage firm and a full-service brokerage firm at its institutional rates.
Based upon such review, the Board of Trustees determines on a quarterly basis
whether the commissions charged by MSC meet the requirements of the Act. MSC
will not participate in commissions from brokerage given by the Fund to other
brokers or dealers. Over-the-counter purchases and sales are transacted through
brokers and dealers with principal market makers. A Fund will in no event effect
principal transactions with MSC in over-the-counter securities in which MSC
makes a market. MSC is a wholly owned subsidiary of RMI, a corporation
controlled by Richard A. Barone, Chairman of the Fund. Richard A. Barone is,
therefore, considered to control MSC.
Under the rules adopted by the SEC, MSC may not execute transactions
for a Fund on the floor of any national securities exchange, but may effect
transactions for a Fund by transmitting orders for execution, providing for
clearance and settlement, and arranging for the performance of those functions
by members of the exchange not associated with MSC. MSC will be required to pay
fees charged by those persons performing the floor brokerage elements out of the
brokerage compensation it receives from the Fund. Each Fund has been advised by
MSC that on most transactions, the floor brokerage generally constitutes from
10% to 40% of the total commissions paid.
<PAGE>
Even though investment decisions for the Fund are made independently
from those of the other accounts managed by MAM, investments of the kind made by
a Fund may also be made by those other accounts. When a Fund and one or more
accounts managed by MAM are prepared to invest in, or desire to dispose of, the
same security, available investments or opportunities for sales will be
allocated in a manner believed by MAM to be equitable. In some cases, this
procedure may adversely affect the price paid or received by the Fund or the
size of the position obtained for or disposed of by the Fund.
CAPITAL STOCK AND OTHER SECURITIES
See "General Information" in the Fund's prospectus.
PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED
The information pertaining to the purchase and redemption of each
Fund's shares appearing in the Prospectus under the captions "How To Purchase
Shares" and "How To Redeem Shares" is hereby incorporated by reference.
DETERMINATION OF NET ASSET VALUE
The information pertaining to the determination of net asset value
appearing in the Prospectus under the caption "How to Purchase Shares -- Price
of Shares" is hereby incorporated by reference.
TAX STATUS
Each Fund will be treated as a separate entity for federal income tax
purposes. Each Fund's policy is to distribute at least annually, prior to the
end of the calendar year, dividends sufficient to satisfy excise tax
requirements of the Internal Revenue Service and to distribute annually, after
the end of the calendar year, any remaining net investment income and net
realized capital gains. Unless a shareholder elects otherwise, dividends and
capital gains distributions are paid in additional shares that are credited to
the shareholder's account with such Fund.
As a result of the application of the Distribution Plan to Investor
Shares only, the amount of dividends on Institutional Shares will exceed the
amount of dividends on Investor Shares.
Each Fund intends to qualify each year as a "regulated investment
company" under the Internal Revenue Code of 1986, as amended (the "Code").
Qualification as a regulated investment company will result in a Fund's paying
no taxes on net income and net realized capital gains distributed to
shareholders. To qualify for this treatment, a Fund must derive at least 90% of
its gross income from dividends, interest, and gains from the sale or other
disposition of securities; derive less than 30% of its gross income from the
sale or other disposition of securities held for fewer than three months; invest
in securities within certain limits; and distribute to its shareholders at least
90% of its net taxable income earned in any year.
<PAGE>
Dividends derived from a Fund's net investment income, whether received
in additional shares or in cash, will be taxable to shareholders as ordinary
income, but a portion may be eligible for the 70% dividends received deduction
available to corporations.
Distributions of the excess of net long-term capital gain over net
short-term capital loss are taxable to a shareholder in the year in which
received (except as set forth in the next paragraph), whether those
distributions are accepted in cash or in additional shares, and regardless of
the length of time the shareholder has held his Fund shares. These
distributions, like dividends, may also be subject to state and local taxes.
In addition to any dividends paid within the calendar year, dividends
and capital gain distributions declared in December and paid the following
January will be taxable in the year they are declared.
Investors should consider carefully the tax implications of purchasing
shares of a Fund just prior to the record date of a dividend or capital gains
distribution. Although a dividend or distribution paid shortly after shares have
been purchased is in effect a return of investment, it is subject to taxation as
described above, and a sale at a loss of shares held not more than six months
will be long-term capital loss to the extent of any long-term capital gain
dividends received within that period.
Shareholders must furnish the Fund with their correct Taxpayer
Identification Number to avoid being subject to a 20% federal backup withholding
tax on dividend distributions. Investors also must certify on the Account
Application that the stated Tax Identification Number is correct and that the
Investor is not subject to 20% backup withholding for previous under-reporting
to the IRS. Shareholders not subject to income taxation do not have to pay an
income tax on the dividend or capital gain distributions.
Shareholders shall upon demand disclose to the Fund in writing such
information with respect to direct and indirect ownership of Shares of the Fund
as the Trustees of the Fund deem necessary to comply with the provisions of the
Internal Revenue Code, or to comply with the requirements of any other taxing
authority.
Statements as to the tax status of each shareholder's dividends and
distributions will be mailed annually by the Fund's transfer agent. Shareholders
are urged to consult their own tax advisers regarding specific questions as to
Federal, state or local taxes.
<PAGE>
DISTRIBUTOR
Shares of the Fund are offered on a best-efforts basis by Maxus
Securities Corp, a registered NASD broker-dealer. MSC is a wholly-owned
subsidiary of RMI, which is controlled by Richard A. Barone, Chairman of the
Fund.
Pursuant to the Distribution Agreement between the Trust and MSC with
respect to Investor Shares, MSC has agreed to hold itself available to receive
orders, satisfactory to MSC, for the purchase of Shares of each Fund, to accept
such orders on behalf of each Fund as of the time of receipt of such orders and
to transmit such orders to the Fund's transfer agent as promptly as practicable.
MSC receives an annual distribution fee of .50% of average net assets for
distributing and marketing the Investor Shares of the Fund. Certain employees of
MSC may receive compensation under the Distribution Plan. See "Investment
Advisory and Other Services."
The Distribution Agreement provides that MSC shall arrange to sell the
Fund's Shares as agent for the Fund and may enter into agreements with
registered broker-dealers as it may select to arrange for the sale of such
shares. MSC is not obligated to sell any certain number of shares.
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial Statements:
The Financial Statements filed as part of this
Registration Statement are as follows:
Statement of Assets and Liabilities as of
December ___, 1997.*
(b) Exhibits:
Exhibit
Number Description
1 Registrant's Declaration of Trust dated
November 7, 1997.
2 Registrant's By-Laws.
3 None.
4 None.
5 Investment Advisory and Administration
Agreement.
6(a) Distribution Agreement.*
7 None.
8 Custody Agreement.*
9(a) Administration Agreement.*
9(b) Accounting Services Agreement.*
10 Opinion and consent.*
11 Consent of Independent Auditors.*
12 None.
<PAGE>
13 Subscription Agreement between the Trust
and Resource Management Inc.*
14 Individual Retirement Account Documents.*
15(a) Plan of Distribution Pursuant to Rule 12b-1*
27 Financial Data Schedule.*
*To be filed by Amendment.
Item 25. Persons Controlled by or Under Common Control with Registrant.
The Fund, together with Maxus Income Fund, Maxus Equity Fund
and Maxus Laureate Fund (three other investment companies),
may be deemed to be under common control on the basis of the
fact that all officers and Trustees of the Fund are also
officers and Trustees of the other three funds.
In addition, the Fund and Resource Management Inc. (together
with its subsidiaries, MAM, MSC and MIS) may be deemed to be
under common control of Richard A. Barone, the Chairman of the
Fund and the President and controlling shareholder of Resource
Management Inc.
Item 26. Number of Holders of Securities.
As of the date of this Registration Statement, there was one
record holder of the Fund's Shares of Beneficial Interest.
Item 27. Indemnification.
Reference is made to Article VIII of the Registrant's
Declaration of Trust filed as Exhibit 1. The application of
these provisions is limited by Article 10 of the Registrant's
By-laws filed as Exhibit 2 and by the following undertaking
set forth in the rules promulgated by the Securities and
Exchange Commission:
<PAGE>
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
trustees, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission
such indemnification is against public policy as
expressed in such Act and is, therefore,
unenforceable. In the event that a claim for
indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or
paid by a trustee, officer or controlling person of
the registrant in the successful defense of any
action, suit or proceeding) is asserted by such
trustee, officer or controlling person in connection
with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question
whether such indemnification by it is against public
policy as expressed in such Act and will be governed
by the final adjudication of such issue.
Item 28. Business and Other Connections of Investment Adviser.
Reference is made to the section in the Prospectus entitled
"Investment Management".
Item 29. Principal Underwriters.
(a) Maxus Securities Corp, the distributor for the Fund, also
distributes securities for Maxus Income Fund, Maxus Equity Fund and
Maxus Laureate Fund.
(b) The following information is provided with respect to each
director and officer of Maxus Securities Corp:
Name and Principal Positions & Offices Positions & Offices
Business Address with Underwriter with Registrant
Richard A. Barone President, Treasurer Chairman, Treasurer
The Tower at Erieview and Director and a Trustee
1301 East Ninth Street
Cleveland, Ohio 44114
Robert W. Curtin Senior Vice President Secretary
The Tower at Erieview and Secretary
1301 East Ninth Street
Cleveland, Ohio 44114
Item 30. Location of Accounts and Records.
All accounts, books and documents required to be maintained by
the Registrant pursuant to Section 31(a) of the Investment
Company Act of 1940 and Rules 31a-1 through 31a-3 thereunder
are maintained at the office of the Registrant and the
Transfer Agent at The Tower at Erieview, 36th Floor, 1301 East
Ninth Street, Cleveland, Ohio 44114, except that all records
relating to the activities of the Fund's Custodian are
maintained at the office of the Custodian, Star Bank, N.A.,
425 Walnut Street, Cincinnati, Ohio 45201.
<PAGE>
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
The Registrant undertakes (1) to furnish a copy of the
Registrant's latest annual report, upon request and without
charge, to every person to whom a Prospectus is delivered, (2)
to file a post-effective amendment, using reasonably current
financial statements which need not be certified, without four
to six months from the effective date of Registrant's
Registration Statement under the Securities Act of 1933, and
(3) to call a meeting of shareholders for the purpose of
voting upon the question of removal of a trustee or trustees
when requesting in writing to do so by the holders of at least
10% of the Registrant's outstanding shares of beneficial
interest and in connection with such meeting to comply with
the provisions of Section 16(c) of the Investment Company Act
of 1940 relating to shareholder communications.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Cleveland, State of Ohio, on the 7th day of November,
1997.
MAXFUND TRUST
By: /s/ Richard A. Barone
Richard A. Barone, Chairman
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
Signature Title Date
/s/ Richard A. Barone
Richard A. Barone Chairman, Treasurer and Trustee 11/07/97
(Principal Executive Officer,
Financial Officer and Accounting
Officer)
/s/ Denis J. Amato
Denis J. Amato Trustee 11/07/97
/s/ Robert A. Schenkelberg, Jr.
Robert A. Schenkelberg, Jr. Trustee 11/07/97
<PAGE>
Exhibit 1
DECLARATION OF TRUST
OF
MAXFUND TRUST
THIS DECLARATION OF TRUST is made this 7th day of November, 1997 by the
Trustees hereunder (hereinafter with any additional and successor trustees
referred to as the "Trustees") and by the holders of shares of beneficial
interest to be issued hereunder as hereinafter provided.
W I T N E S S E T H:
WHEREAS, the Trustees have formed an unincorporated association in the
form of a business trust under the laws of the State of Ohio for the investment
and reinvestment of funds contributed thereto; and
WHEREAS, the Trustees have agreed to manage all property coming into
their hands as trustees of an Ohio business trust in accordance with the
provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will hold all
cash, securities and other assets, which they may from time to time acquire in
any manner as Trustees hereunder IN TRUST to manage and dispose of the same upon
the following terms and conditions for the pro rata benefit of the holders from
time to time of Shares, whether or not certificated, in this Trust as
hereinafter set forth.
ARTICLE I
Name and Definitions
Section 1. Name. This Trust shall be known as "MaxFund Trust".
Section 2. Definitions. Whenever used herein, unless otherwise
required by the context or specifically provided:
(a) The term "Commission" shall have the meaning provided
in the 1940 Act;
(b) The "Trust" refers to the Ohio business trust
established by this Declaration of Trust, as amended from time to time;
(c) "Shareholder" means a record owner of Shares of the
Trust;
(d) "Shares" means the equal proportionate transferable units
of interest into which the beneficial interest in the Trust shall be
divided from time to time or, if more than one series or class of
Shares is authorized by the Trustees, the equally proportionate
transferable units into which each series or class of Shares shall be
divided from time to time, and includes a fraction of a Share as well
as a whole Share;
<PAGE>
(e) The "1940 Act" refers to the Investment Company Act of
1940, and the Rules and Regulations thereunder, all as amended from
time to time;
(f) The term "Manager" is defined in Article IV, Section 5;
(g) The term "Person" shall mean an individual or any
corporation, partnership, joint venture, trust or other enterprise;
(h) "Declaration of Trust" shall mean this Declaration of
Trust as amended or restated from time to time;
(i) "Bylaws" shall mean the Bylaws of the Trust as amended
from time to time;
(j) The term "series" or "series of Shares" refers to the one
or more separate investment portfolios of the Trust into which the
assets and liabilities of the Trust may be divided and the Shares of
the Trust representing the beneficial interest of Shareholders in such
respective portfolios; and
(k) The term "class" or "class of Shares" refers to the
division of Shares representing any series into two or more classes as
provided in Article III, Section 1 hereof.
ARTICLE II
Purposes of Trust
This Trust is formed for the following purpose or purposes:
(a) to conduct, operate and carry on the business of an
investment company;
<PAGE>
(b) to subscribe for, invest in, reinvest in, purchase or
otherwise acquire, hold, pledge, sell, assign, transfer, lend, write
options on, exchange, distribute or otherwise dispose of and deal in
and with securities of every nature, kind, character, type and form,
including, without limitation of the generality of the foregoing, all
types of stocks, shares, futures contracts, bonds, debentures, notes,
bills and other negotiable or non-negotiable instruments, obligations,
evidences of interest, certificates of interest, certificates of
participation, certificates, interests, evidences of ownership,
guarantees, warrants, options or evidences of indebtedness issued or
created by or guaranteed as to principal and interest by any state or
local government or any agency or instrumentality thereof by the United
States Government or any agency, instrumentality, territory, district
or possession thereof, by any foreign government or any agency,
instrumentality, territory, district or possession thereof, by any
corporation organized under the laws of any state, the United States or
any territory or possession thereof or under the laws of any foreign
country, bank certificates of deposit, bank time deposits, bankers'
acceptances and commercial paper; to pay for the same in cash or by the
issue of stock, including treasury stock, bonds or notes of the Trust
or otherwise; and to exercise any and all rights, powers and privileges
of ownership or interest in respect of any and all such investments of
every kind and description, including, without limitation, the right to
consent and otherwise act with respect thereto, with power to designate
one or more persons, firms, associations or corporations to exercise
any of said rights, powers and privileges in respect of any said
instruments;
(c) to borrow money or otherwise obtain credit and to secure
the same by mortgaging, pledging or otherwise subjecting as security
the assets of the Trust;
(d) to issue, sell, repurchase, redeem, retire, cancel,
acquire, hold, resell, reissue, dispose of, transfer, and otherwise
deal in, Shares including Shares in fractional denominations, and to
apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds or other assets of the appropriate
series or class of Shares, whether capital or surplus or otherwise, to
the full extent now or hereafter permitted by the laws of the State of
Ohio;
(e) to conduct its business, promote its purposes, and carry
on its operations in any and all of its branches and maintain offices
both within and without the State of Ohio, in any and all States of the
United States of America, in the District of Columbia, and in any other
parts of the world; and
(f) to do all and everything necessary, suitable, convenient,
or proper for the conduct, promotion, and attainment of any of the
businesses and purposes herein specified or which at any time may be
incidental thereto or may appear conducive to or expedient for the
accomplishment of any of such businesses and purposes and which might
be engaged in or carried on by a business trust organized under Ohio
Revised Code Chapter 1746, and to have and exercise all of the powers
conferred by the laws of the State of Ohio upon an Ohio business trust.
The foregoing provisions of this Article II shall be construed both as
purposes and powers and each as an independent purpose and power.
ARTICLE III
Beneficial Interest
Section 1. Shares of Beneficial Interest. The Shares of the Trust shall
be issued in one or more series as the Trustees may, without Shareholder
approval, authorize. Each series shall be preferred over all other series in
respect of the assets allocated to that series and shall represent a separate
investment portfolio of the Trust. The beneficial interest in each series at all
times shall be divided into Shares, with or without par value as the Trustees
may from time to time determine, each of which shall except as provided in the
following sentence, represent an equal proportionate interest in the series with
each other Share of the same series, none having priority or preference over
another. The Trustees may, without Shareholder approval, divide Shares of any
series into two or more classes, Shares of each such class having such
preferences and special or relative rights and privileges (including conversion
rights, if any) as the Trustees may determine. The number of Shares authorized
shall be unlimited, and the Shares so authorized may be represented in part by
fractional shares. From time to time, the Trustees may divide or combine the
Shares of any series or class into a greater or lesser number without thereby
changing the proportionate beneficial interests in the series or class.
<PAGE>
Section 2. Ownership of Shares. The ownership of Shares will be
recorded in the books of the Trust or a transfer agent. The record books of the
Trust or any transfer agent, as the case may be, shall be conclusive as to who
are the holders of Shares of each series and class and as to the number of
Shares of each series and class held from time to time by each. No certificates
certifying the ownership of Shares need be issued except as the Trustees may
otherwise determine from time to time.
Section 3. Issuance of Shares. The Trustees are authorized, from time
to time, to issue or authorize the issuance of Shares at not less than the par
value thereof, if any, and to fix the price or the minimum price or the
consideration (in cash and/or such other property, real or personal, tangible or
intangible, as from time to time they may determine) or minimum consideration
for such Shares. Anything herein to the contrary notwithstanding, the Trustees
may issue Shares pro rata to the Shareholders of a series at any time as a stock
dividend, except to the extent otherwise required or permitted by the
preferences and special or relative rights and privileges of any classes of
Shares of that series, and any stock dividend to the Shareholders of a
particular class of Shares shall be made to such Shareholders pro rata in
proportion to the number of Shares of such class held by each of them.
All consideration received by the Trust for the issue or sale of Shares
of each series, together with all income, earnings, profits, and proceeds
thereof, including any proceeds derived from the sale, exchange or liquidation
thereof, and any funds or payments derived from any reinvestment of such
proceeds in whatever form the same may be, shall belong irrevocably to the
series of Shares with respect to which the same were received by the Trust for
all purposes, subject only to the rights of creditors, and shall be so handled
upon the books of account of the Trust and are herein referred to as "assets of"
such series.
Shares may be issued in fractional denominations to the same extent as
whole Shares, and Shares in fractional denominations shall be Shares having
proportionately to the respective fractions represented thereby all the rights
of whole Shares, including, without limitation, the right to vote, the right to
receive dividends and distributions, and the right to participate upon
liquidation of the Trust or of a particular series of Shares.
<PAGE>
Section 4. No Preemptive Rights; Derivative Suits. Shareholders shall
have no preemptive or other right to subscribe for any additional Shares or
other securities issued by the Trust. No action may be brought by a Shareholder
on behalf of the Trust or a series unless a prior demand regarding such matter
has been made on the Trustees and the Shareholders of the Trust or such series.
Section 5. Status of Shares and Limitation of Personal Liability.
Shares shall be deemed to be personal property giving only the rights provided
in this instrument. Every Shareholder by virtue of having become a Shareholder
shall be held to have expressly assented and agreed to the terms hereof and to
have become a party hereto. The death of a Shareholder during the continuance of
the Trust shall not operate to terminate the same nor entitle the representative
of any deceased Shareholder to an accounting or to take any action in court or
elsewhere against the Trust or the Trustees, but only to the rights of said
decedent under this Trust. Ownership of Shares shall not entitle the Shareholder
to any title in or to the whole or any part of the Trust property or right to
call for a partition or division of the same or for an accounting, nor shall the
ownership of Shares constitute the Shareholders partners. Neither the Trust nor
the Trustees, nor any officer, employee or agent of the Trust shall have any
power to bind any Shareholder or Trustee personally or to call upon any
Shareholder for the payment of any sum of money or assessment whatsoever other
than such as the Shareholder at any time personally may agree to pay by way of
subscription for any Shares or otherwise. Every note, bond, contract or other
undertaking issued by or on behalf of the Trust shall include a recitation
limiting the obligation represented thereby to the Trust and its assets or the
assets of a particular series (but the omission of such a recitation shall not
operate to bind any Shareholder or Trustee personally).
ARTICLE IV
Trustees
Section 1. Election. A Trustee may be elected either by the Trustees or
the Shareholders. The Trustees named herein shall serve until the first meeting
of the Shareholders or until the election and qualification of their successors.
Prior to the first meeting of Shareholders the initial Trustees hereunder may
elect additional Trustees to serve until such meeting and until their successors
are elected and qualified. The Trustees also at any time may elect Trustees to
fill vacancies in the number of Trustees. The number of Trustees shall be fixed
from time to time by the Trustees and, at or after the commencement of the
business of the Trust, shall be not less than three. Each Trustee, whether
referred to hereinafter or hereafter becoming a Trustee, shall serve as a
Trustee during the lifetime of this Trust, until such Trustee dies, resigns,
retires, or is removed, or, if sooner, until the next meeting of Shareholders
called for the purpose of electing Trustees and the election and qualification
of his successor. Subject to Section 16(a) of the 1940 Act, the Trustees may
elect their own successors and, pursuant to this Section, may appoint Trustees
to fill vacancies.
<PAGE>
Section 2. Powers. The Trustees shall have all powers necessary or
desirable to carry out the purposes of the Trust, including, without limitation,
the powers referred to in Article II hereof. Without limiting the generality of
the foregoing, the Trustees may adopt By-Laws not inconsistent with this
Declaration of Trust providing for the conduct of the business of the Trust and
may amend and repeal them to the extent that they do not reserve that right to
the Shareholders; they may fill vacancies in their number, including vacancies
resulting from increases in their own number, and may elect and remove such
officers and employ, appoint and terminate such employees or agents as they
consider appropriate; they may appoint from their own number and terminate any
one or more committees; they may employ one or more custodians of the assets of
the Trust and may authorize such custodians to employ subcustodians and to
deposit all or any part of such assets in a system or systems for the central
handling of securities, retain a transfer agent and a Shareholder servicing
agent, or both, provide for the distribution of Shares through a principal
underwriter or otherwise, set record dates, and in general delegate such
authority as they consider desirable (including, without limitation, the
authority to purchase and sell securities and to invest funds, to determine the
net income of the Trust for any period, the value of the total assets of the
Trust and the net asset value of each Share, and to execute such deeds,
agreements or other instruments either in the name of the Trust or the names of
the Trustees or as their attorney or attorneys or otherwise as the Trustees from
time to time may deem expedient) to any officer of the Trust, committee of the
Trustees, any such employee, agent, custodian or underwriter or to any Manager.
Without limiting the generality of the foregoing, the Trustees shall
have full power and authority:
(a) To invest and reinvest cash and to hold cash uninvested;
(b) To vote or give assent, or exercise any rights of
ownership, with respect to stock or other securities or property; and
to execute and deliver proxies or powers of attorney to such person or
persons as the Trustees shall deem proper, granting to such person or
persons such power and discretion with relation to securities or
property as the Trustees shall deem proper;
(c) To hold any security or property in a form not indicating
any trust whether in bearer, unregistered or other negotiable form or
in the name of the Trust or a custodian, subcustodian or other
depository or a nominee or nominees or otherwise;
(d) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or concern,
any security of which is held in the Trust; to consent to any contract,
lease, mortgage, purchase or sale of property by such corporation or
concern, and to pay calls or subscriptions with respect to any security
held in the Trust;
(e) To join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that
connection to deposit any security with, or transfer any security to,
any such committee, depositary or trustee, and to delegate to them such
power and authority with relation to any security (whether or not so
deposited or transferred) as the Trustees shall deem proper, and to
agree to pay, and to pay, such portion of the expenses and compensation
of such committee, depositary or trustee as the Trustees shall deem
proper;
<PAGE>
(f) To compromise, arbitrate, or otherwise adjust claims in
favor of or against the Trust or any matter in controversy, including,
but not limited to, claims for taxes;
(g) Subject to the provisions of Article III, Section 3, to
allocate assets, liabilities, income and expenses of the Trust to a
particular series of Shares or to apportion the same among two or more
series, provided that any liabilities or expenses incurred by a
particular series of Shares shall be payable solely out of the assets
of that series; and to the extent necessary or appropriate to give
effect to the preferences and special or relative rights and privileges
of any classes of Shares, to allocate assets, liabilities, income and
expenses of a series to a particular class of Shares of that series or
to apportion the same among two or more classes of Shares of that
series;
(h) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
(i) To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate for the
conduct of the business, including, without limitation, insurance
policies insuring the assets of the Trust and payment of distributions
and principal on its portfolio investments, and insurance policies
insuring the Shareholders, Trustees, officers, employees, agents,
investment advisers or Managers, principal underwriters, or independent
contractors of the Trust individually against all claims and
liabilities of every nature arising by reason of holding, being or
having held any such office or position, or by reason of any action
alleged to have been taken or omitted by any such person as
Shareholder, Trustee, officer, employee, agent, investment adviser or
Manager, principal underwriter, or independent contractor, including
any action taken or omitted that may be determined to constitute
negligence, whether or not the Trust would have the power to indemnify
such person against such liability; and
(j) To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry out
pension, profit-sharing, share bonus, share purchase, savings, thrift
and other retirement, incentive and benefit plans, trusts and
provisions, including the purchasing of life insurance and annuity
contracts as a means of providing such retirement and other benefits,
for any or all of the Trustees, officers, employees and agents of the
Trust.
Further, without limiting the generality of the foregoing, the Trustees
shall have full power and authority to incur and pay out of the principal or
income of the Trust such expenses and liabilities as may be deemed by the
Trustees to be necessary or proper for the purposes of the Trust; provided,
however, that all expenses and liabilities incurred by or arising in connection
with a particular series of Shares, as determined by the Trustees, shall be
payable solely out of the assets of that series.
<PAGE>
Any determination made in good faith and, so far as accounting matters
are involved, in accordance with generally accepted accounting principles by or
pursuant to the authority granted by the Trustees, as to the amount of the
assets, debts, obligations or liabilities of the Trust or a particular series or
class of Shares; the amount of any reserves or charges set up and the propriety
thereof; the time of or purpose for creating such reserves or charges; the use,
alteration or cancellation of any reserves or charges (whether or not any debt,
obligation or liability for which such reserves or charges shall have been
created shall have been paid or discharged or shall be then or thereafter
required to be paid or discharged); the price or closing bid or asked price of
an investment owned or held by the Trust or a particular series; the market
value of any investment or fair value of any other asset of the Trust or a
particular series; the number of Shares outstanding; the estimated expense to
the Trust or a particular series in connection with purchases of its Shares; the
ability to liquidate investments in an orderly fashion; and the extent to which
it is practicable to deliver a cross-section of the portfolio of the Trust or a
particular series in payment for any such Shares, or as to any other matters
relating to the issue, sale, purchase and/or other acquisition or disposition of
investments or Shares of the Trust or a particular series, shall be final and
conclusive, and shall be binding upon the Trust or such series and its
Shareholders, past, present and future, and Shares are issued and sold on the
condition and understanding that any and all such determinations shall be
binding as aforesaid.
Section 3. Meetings. At any meeting of the Trustees, a majority of the
Trustees then in office shall constitute a quorum. Any meeting may be adjourned
from time to time by a majority of the votes cast upon the question, whether or
not a quorum is present, and the meeting may be held as adjourned without
further notice.
When a quorum is present at any meeting, a majority of the Trustees
present may take an action, except when a larger vote is required by this
Declaration of Trust, the By-Laws or the 1940 Act.
Any action required or permitted to be taken at any meeting of the
Trustees or of any committee thereof may be taken without a meeting, if a
written consent to such action is signed by a majority of the Trustees or
members of any such committee then in office, as the case may be, and such
written consent is filed with the minutes of proceedings of the Trustees or any
such committee.
The Trustees or any committee designated by the Trustee may participate
in a meeting of the Trustees or such committee by means of a conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other at the same time. Participation
by such means shall constitute presence in person at a meeting.
Section 4. Ownership of Assets of the Trust. Title to all of the assets
of each series of Shares of the Trust at all times shall be considered as vested
in the Trustees.
<PAGE>
Section 5. Investment Advice and Management Services. The Trustees
shall not in any way be bound or limited by any present or future law or custom
in regard to investments by trustees. The Trustees from time to time may enter
into a written contract or contracts with any person or persons (herein called
the "Manager"), including any firm, corporation, trust or association in which
any Trustee or Shareholder may be interested, to act as investment advisers
and/or managers of the Trust and to provide such investment advice and/or
management as the Trustees from time to time may consider necessary for the
proper management of the assets of the Trust, including, without limitation,
authority to determine from time to time what investments shall be purchased,
held, sold or exchanged and what portion, if any, of the assets of the Trust
shall be held uninvested and to make changes in the Trust's Investments. Any
such contract shall be subject to the requirements of the 1940 Act with respect
to its continuance in effect, its termination and the method of authorization
and approval of such contract, or any amendment thereto or renewal thereof.
Any Trustee or any organization with which any Trustee may be
associated also may act as broker for the Trust in making purchases and sales of
securities for or to the Trust for its investment portfolio, and may charge and
receive from the Trust the usual and customary commission for such service. Any
organization with which a Trustee may be associated in acting as broker for the
Trust shall be responsible only for the proper execution of transactions in
accordance with the instructions of the Trust and shall be subject to no further
liability of any sort whatever.
The Manager, or any affiliate thereof, also may be a distributor for
the sale of Shares by separate contract or may be a person controlled by or
affiliated with any Trustee or any distributor or a person in which any Trustee
or any distributor is interested financially, subject only to applicable
provisions of law. Nothing herein contained shall operate to prevent any
Manager, who also acts as such a distributor, from also receiving compensation
for services rendered as such distributor.
Section 6. Removal and Resignation of Trustees. The Trustees or the
Shareholders (by vote of 66-2/3% of the outstanding Shares entitled to vote
thereon) may remove at any time any Trustee with or without cause, and any
Trustee may resign at any time as Trustee, without penalty by written notice to
the Trust; provided that sixty days' advance written notice shall be given in
the event that there are only three or fewer Trustees at the time a notice of
resignation is submitted.
ARTICLE V
Shareholders' Voting Powers and Meetings
Section 1. Voting Powers. The Shareholders shall have power to vote
only (i) for the election of Trustees as provided in Article IV, Section 1, of
this Declaration of Trust; provided, however, that no meeting of Shareholders is
required to be called for the purpose of electing Trustees unless and until such
time as less than a majority of the Trustees have been elected by the
Shareholders, (ii) for the removal of Trustees as provided in Article IV,
Section 6, (iii) with respect to any Manager as provided in Article IV, Section
5, (iv) with respect to any amendment of this Declaration of Trust as provided
in Article IX, Section 8, (v) with respect to the termination of the Trust or a
series of Shares as provided in Article IX, Section 5, and (vi) with respect to
such additional matters relating to the Trust as may be required by law, by this
Declaration of Trust, or the By-Laws of the Trust or any registration of the
Trust with the Commission or any state, or as the Trustees may consider
desirable. Each whole Share shall be entitled to one vote as to any matter on
<PAGE>
which it is entitled to vote (except that in the election of Trustees said vote
may be cast for as many persons as there are Trustees to be elected), and each
fractional Share shall be entitled to a proportionate fractional vote.
Notwithstanding any other provision of this Declaration of Trust, on any matter
submitted to a vote of Shareholders, all Shares of the Trust then entitled to
vote shall be voted in the aggregate as a single class without regard to series
or classes of Shares, except (i) when required by the 1940 Act or when the
Trustees shall have determined that the matter affects one or more series or
classes differently Shares shall be voted by individual series or class and (ii)
when the Trustees have determined that the matter affects only the interests of
one or more series or classes then only Shareholders of such series or classes
shall be entitled to vote thereon. There shall be no cumulative voting in the
election of Trustees. Shares may be voted in person or by proxy. A proxy with
respect to Shares held in the name of two or more persons shall be valid if
executed by any one of them, unless at or prior to exercise of the proxy the
Trust receives a specific written notice to the contrary from any one of them. A
proxy purporting to be executed by or on behalf of a Shareholder shall be deemed
valid unless challenged at or prior to its exercise and the burden of proving
invalidity shall rest on the challenger. Whenever no Shares of any series or
class are issued and outstanding, the Trustees may exercise with respect to such
series or class all rights of Shareholders and may take any action required by
law, this Declaration of Trust or any By-Laws of the Trust to be taken by
Shareholders.
Section 2. Meetings. Meetings of the Shareholders may be called by the
Trustees or such other person or persons as may be specified in the By-Laws and
shall be called by the Trustees upon the written request of Shareholders owning
at least 10% of the outstanding Shares entitled to vote. Shareholders shall be
entitled to at least ten days' prior notice of any meeting.
Section 3. Quorum and Required Vote. Thirty percent (30%) of the
outstanding Shares shall be a quorum for the transaction of business at a
Shareholders' meeting, except that where any provision of law or of this
Declaration of Trust permits or requires that holders of any series or class
shall vote as a series or class, then thirty percent (30%) of the aggregate
number of Shares of that series or class entitled to vote shall be necessary to
constitute a quorum for the transaction of business by that series or class. Any
lesser number, however, shall be sufficient for adjournment and any adjourned
session or sessions may be held within 90 days after the date set for the
original meeting without the necessity of further notice. Except when a larger
vote is required by any provision of this Declaration of Trust or the ByLaws of
the Trust and subject to any applicable requirements of law, a majority of the
Shares voted shall decide any question and a plurality shall elect a Trustee,
provided that where any provision of law or of this Declaration of Trust permits
or requires that the holders of any series or class shall vote as a series or
class, then a majority of the Shares of that series or class voted on the matter
(or a plurality with respect to the election of a Trustee) shall decide that
matter insofar as that series or class is concerned.
Section 4. Action by Written Consent. Any action required or permitted
to be taken at any meeting may be taken without a meeting if a consent in
writing, setting forth such action, is signed by a majority of Shareholders
entitled to vote on the subject matter thereof (or such larger proportion
thereof as shall be required by any express provision of this Declaration of
Trust) and such consent is filed with the records of the Trust.
<PAGE>
Section 5. Additional Provisions. The By-Laws may include further
provisions for Shareholders, votes and meetings and related matters.
ARTICLE VI
Distributions and Redemptions
Section 1. Distributions. The Trustees shall distribute periodically to
the Shareholders of each series of Shares an amount approximately equal to the
net income of that series, determined by the Trustees or as they may authorize
and as herein provided. Distributions of income may be made in one or more
payments, which shall be in Shares, cash or otherwise, and on a date or dates
and as of a record date or dates determined by the Trustees. At any time and
from time to time in their discretion, the Trustees also may cause to be
distributed to the Shareholders of any one or more series as of a record date or
dates determined by the Trustees, in Shares, cash or otherwise, all or part of
any gains realized on the sale or disposition of the assets of the series or all
or part of any other principal of the Trust attributable to the series. Each
distribution pursuant to this Section 1 shall be made ratably according to the
number of Shares of the series held by the several Shareholders on the record
date for such distribution, except to the extent otherwise required or permitted
by the preferences and special or relative rights and privileges of any classes
of Shares of that series, and any distribution to the Shareholders of a
particular class of Shares shall be made to such Shareholders pro rata in
proportion to the number of Shares of such class held by each of them. No
distribution need be made on Shares purchased pursuant to orders received, or
for which payment is made, after such time or times as the Trustees may
determine.
Section 2. Determination of Net Income. In determining the net income
of each series or class of Shares for any period, there shall be deducted from
income for that period (a) such portion of all charges, taxes, expenses and
liabilities due or accrued as the Trustees shall consider properly chargeable
and fairly applicable to income for that period or any earlier period and (b)
whatever reasonable reserves the Trustees shall consider advisable for possible
future charges, taxes, expenses and liabilities which the Trustees shall
consider properly chargeable and fairly applicable to income for that period or
an earlier period. The net income of each series or class for any period may be
adjusted for amounts included on account of net income in the net asset value of
Shares issued or redeemed or repurchased during that period. In determining the
net income of a series or class for a period ending on a date other than the end
of its fiscal year, income may be estimated as the Trustees shall deem fair.
Gains on the sale or disposition of assets shall not be treated as income, and
losses shall not be charged against income unless appropriate under applicable
accounting principles, except in the exercise of the discretionary powers of the
Trustees. Any amount contributed to the Trust which is received as income
pursuant to a decree of any court of competent jurisdiction shall be applied as
required by the said decree.
<PAGE>
Section 3. Redemptions. Any Shareholder shall be entitled to require
the Trust to redeem and the Trust shall be obligated to redeem at the option of
such Shareholder all or any part of the Shares owned by said Shareholder, at the
redemption price, pursuant to the method, upon the terms and subject to the
conditions hereinafter set forth:
(a) Certificates for Shares, if issued, shall be presented for
redemption in proper form for transfer to the Trust or the agent of the
Trust appointed for such purpose, and these shall be presented with a
written request that the Trust redeem all or any part of the Shares
represented thereby.
(b) The redemption price per Share shall be the net asset
value per Share when next determined by the Trust at such time or times
as the Trustees shall designate, following the time of presentation of
certificates for Shares, if issued, and an appropriate request for
redemption, or such other time as the Trustees may designate in
accordance with any provision of the 1940 Act, or any rule or
regulation made or adopted by any securities association registered
under the Securities Exchange Act of 1934, as determined by the
Trustees, less any applicable charge or fee imposed from time to time
as determined by the Trustees.
(c) Net asset value of each series or class of Shares (for the
purpose of issuance of Shares as well as redemptions thereof) shall be
determined by dividing:
(i) the total value of the assets of such series or
class determined as provided in paragraph (d) below less to
the extent determined by or pursuant to the direction of the
Trustees in accordance with generally accepted accounting
principles, all debts, obligations and liabilities of such
series or class (which debts, obligations and liabilities
shall include, without limitation of the generality of the
foregoing, any and all debts, obligations, liabilities, or
claims, of any and every kind and nature, fixed, accrued and
otherwise, including the estimated accrued expenses of
management and supervision, administration and distribution
and any reserves or charges for any or all of the foregoing,
whether for taxes, expenses, or otherwise, and the price of
Shares redeemed but not paid for) but excluding the Trust's
liability upon its Shares and its surplus, by
(ii) the total number of Shares of such series or class
outstanding.
The Trustees are empowered, in their absolute discretion, to
establish other methods for determining such net asset value whenever
such other methods are deemed by them to be necessary to enable the
Trust to comply with applicable law, or are deemed by them to be
desirable, provided they are not inconsistent with any provision of the
1940 Act.
(d) In determining for the purposes of this Declaration of
Trust the total value of the assets of each series or class of Shares
at any time, investments and any other assets of such series or class
shall be valued in such manner as may be determined from time to time
by or pursuant to the order of the Trustees.
<PAGE>
(e) Payment of the redemption price by the Trust may be made
either in cash or in securities or other assets at the time owned by
the Trust or partly in cash and partly in securities or other assets at
the time owned by the Trust. The value of any part of such payment to
be made in securities or other assets of the Trust shall be the value
employed in determining the redemption price. Payment of the redemption
price shall be made on or before the seventh day following the day on
which the Shares are improperly presented for redemption hereunder,
except that delivery of any securities included in any such payment
shall be made as promptly as any necessary transfers on the books of
the issuers whose securities are to be delivered may be made and,
except as postponement of the date of payment may be permissible under
the 1940 Act.
Pursuant to resolution of the Trustees, the Trust may deduct
from the payment made for any Shares redeemed a liquidating charge not
in excess of an amount determined by the Trustees from time to time.
(f) The right of any holder of Shares redeemed by the Trust as
provided in this Article VI to receive dividends or distributions
thereon and all other rights of such Shareholder with respect to such
Shares shall terminate at the time as of which the redemption price of
such Shares is determined, except the right of such Shareholder to
receive (i) the redemption price of such Shares from the Trust in
accordance with the provisions hereof, and (ii) any dividend or
distribution to which such Shareholder previously had become entitled
as the record holder of such Shares on the record date for such
dividend or distribution.
(g) Redemption of Shares by the Trust is conditional upon the
Trust having funds or other assets legally available therefor.
(h) The Trust, either directly or through an agent, may
repurchase its Shares, out of funds legally available therefor, upon
such terms and conditions and for such consideration as the Trustees
shall deem advisable, by agreement with the owner at a price not
exceeding the net asset value per Share as determined by or pursuant to
the order of the Trustees at such time or times as the Trustees shall
designate, less any applicable charge, if and as fixed by the Trustees
from time to time, and to take all other steps deemed necessary or
advisable in connection therewith.
(i) Shares purchased or redeemed by the Trust shall be
cancelled or held by the Trust for reissue, as the Trustees from time
to time may determine.
(j) The obligations set forth in this Article VI may be
suspended or postponed, (1) for any period (i) during which the New
York Stock Exchange is closed other than for customary weekend and
holiday closings or (ii) during which trading on the New York Stock
Exchange is restricted, (2) for any period during which an emergency
exists as a result of which (i) the disposal by the Trust of
investments owned by it is not reasonably practicable, or (ii) it is
not reasonably practicable for the Trust fairly to determine the value
of its net assets, or (3) for such other periods as the Commission or
any successor governmental authority by order may permit.
<PAGE>
Notwithstanding any other provision of this Section 3 of Article VI, if
certificates representing such Shares have been issued, the redemption or
repurchase price need not be paid by the Trust until such certificates are
presented in proper form for transfer to the Trust or the agent of the Trust
appointed for such purpose; however, the redemption or repurchase shall be
effective, in accordance with the resolution of the Trustees, regardless of
whether or not such presentation has been made.
Section 4. Redemptions at the Option of the Trust. The Trust shall have
the right at its option and at any time to redeem Share of any Shareholder at
the net asset value thereof as determined in accordance with Section 3 of
Article VI of this Declaration of Trust: (i) if at such time such Shareholder
owns fewer Shares than, or Shares having an aggregate net asset value of less
than, an amount determined from time to time by the Trustees, or (ii) to the
extent that such Shareholder owns Shares of a particular series or class of
Shares equal to or in excess of a percentage of the outstanding Shares of that
series or class determined from time to time by the Trustees, or (iii) to the
extent that such Shareholder owns Shares of the Trust representing a percentage
equal to or in excess of such percentage of the aggregate number of outstanding
Shares of the Trust or the aggregate net asset value of the Trust determined
from time to time by the Trustees.
Section 5. Dividends, Distributions, Redemptions and Repurchases. No
dividend or distribution including, without limitation, any distribution paid
upon termination of the Trust or of any series) with respect to, nor any
redemption or repurchase of, the Shares of any series shall be effected by the
Trust other than from the assets of such series.
ARTICLE VII
Compensation and Limitation of
Liability of Trustees
Section 1. Compensation. The Trustees shall be entitled to reasonable
compensation from the Trust and may fix the amount of their compensation.
Section 2. Limitation of Liability. The Trustees shall not be
responsible or liable in any event for any neglect or wrongdoing of any officer,
agent, employee or Manager of the Trust, nor shall any Trustee be responsible
for the act or omission of any other Trustee, but nothing herein contained shall
protect any Trustee against any liability to which he would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his office.
<PAGE>
Every note, bond, contract, instrument, certificate, share, or
undertaking and every other act or thing whatsoever executed or done by or on
behalf of the Trust or the Trustees or any of them in connection with the Trust,
shall be deemed conclusively to have been executed or done only in their or his
capacity as Trustees or Trustee, and such Trustees or Trustee shall not be
personally liable thereon.
ARTICLE VIII
Indemnification
Section 1. Indemnification of Trustees, Officers, Employees and
Agents. Each person who is or was a Trustee, officer, employee or agent of the
Trust or who serves or has served at the Trust's request as a director, officer
or trustee of another entity in which the Trust has or had any interest as a
shareholder, creditor or otherwise shall be entitled to indemnification out of
the assets of the Trust to the extent provided in, and subject to the provisions
of, the By-Laws, provided that no indemnification shall be granted by the Trust
in contravention of the 1940 Act.
Section 2. Merged Corporations. For the purposes of this Article VIII
references to "the Trust" include any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had power and authority to
indemnify its directors, officers, employees or agents as well as the resulting
or surviving entity; so that any person who is or was a director, officer,
employee or agent of such a constituent corporation or is or was serving at the
request of such a constituent corporation as a trustee, director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise shall stand in the same position under the provisions of this
Article VIII with respect to the resulting or surviving entity as he would have
with respect to such a constituent corporation if its separate existence had
continued.
Section 3. Shareholders. In case any Shareholder or former Shareholder
shall be held to be personally liable solely by reason of his being or having
been a Shareholder and not because of his acts or omissions or for some other
reason, the Shareholder or former Shareholder (or his heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled out of
the assets of the particular series of Share of which he is or was a Shareholder
to be held harmless from and indemnified against all losses and expenses arising
from such liability. Upon request, the Trust shall cause its counsel to assume
the defense of any claim which, if successful, would result in an obligation of
the Trust to indemnify the Shareholder as aforesaid.
<PAGE>
ARTICLE IX
Status of the Trust and Other General Provisions
Section 1. Trust Not a Partnership. It is hereby expressly declared
that a trust and not a partnership is created hereby. Neither the Trust nor the
Trustees, nor any officer, employee or agent of the Trust shall have any power
to bind personally either the Trust's Trustees or officers or any Shareholders.
All persons extending credit to, contracting with or having any claim against
the Trust or a particular series of Shares shall look only to the assets of the
Trust or the assets of that particular series for payment under such credit,
contract or claim; and neither the Shareholders nor the Trustees, nor any of the
Trust's officers, employees or agents, whether past, present or future, shall be
personally liable therefore. Nothing in this Declaration of Trust shall protect
any Trustee against any liability to which such Trustee otherwise would be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of
Trustee hereunder.
Section 2. Trustee's Good Faith Action, Expert Advice, No Bond or
Surety. The exercise by the Trustees of their powers and discretion hereunder
under the circumstances then prevailing, shall be binding upon every one
interested. A Trustee shall be liable for his or her own willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee, and for nothing else, and shall not be liable
for errors of judgment or mistakes of fact or law. The Trustees may take advice
of counsel or other experts with respect to the meaning and operation of this
Declaration of Trust, and subject to the provisions of Section 1 of this Article
IX shall be under no liability for any act or omission in accordance with such
advice or for failing to follow such advice. The Trustees shall not be required
to give any bond as such, nor any surety if a bond is required.
Section 3. Liability of Third Persons Dealing with Trustees. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees pursuant hereto
or to see to the application of any payments made or property transferred to the
Trust or upon its order.
Section 4. Trustees, Shareholders, etc. Not Personally Liable; Notice.
All persons extending credit to, contracting with or having any claim against
the Trust or a particular series of Shares shall look only to the assets of the
Trust or the assets of that particular series of Shares for payment under such
credit, contract or claim; and neither the Shareholders nor the Trustees, nor
any of the Trust's officers, employees or agents, whether past, present or
future, shall be personally liable therefor.
Section 5. Termination of Trust. Unless terminated as provided herein,
the Trust shall continue without limitation of time. The Trust may be terminated
at any time by vote of Shareholders holding at least a majority of the Shares of
each series entitled to vote or by the Trustees by written notice to the
Shareholders. Any series of Shares may be terminated at any time by vote of
Shareholders holding at least a majority of the Shares of such series entitled
to vote or by the Trustees by written notice to the Shareholders of such series.
<PAGE>
Upon termination of the Trust or of any one or more series of Shares,
after paying or otherwise providing for all charges, taxes, expenses and
liabilities, whether due or accrued or anticipated as may be determined by the
Trustees, the Trust shall reduce, in accordance with such procedures as the
Trustees consider appropriate, the remaining assets to distributable form in
cash or shares or other securities, or any combination thereof, and distribute
the proceeds to the Shareholders of the series involved, ratably according to
the number of Shares of such series held by the several Shareholders of such
series on the date of termination, except to the extent otherwise required or
permitted by the preferences and special or relative rights and privileges of
any classes of Shares of that series, provided that any distribution to the
Shareholders of a particular class of Shares shall be made to such Shareholders
pro rata in proportion to the number of Shares of such class held by each of
them.
Section 6. Filing of Copies, References, Headings. The original or a
copy of this instrument and of each amendment hereto and of each Declaration of
Trust supplemental hereto shall be kept at the office of the Trust where it may
be inspected by any Shareholder. A copy of this instrument and of each such
amendment shall be filed by the Trust with the Secretary of State of the State
of Ohio, as well as any other governmental office where such filing may from
time to time be required. Anyone dealing with the Trust may rely on a
certificate by an officer of the Trust as to whether or not any such amendments
have been made and as to matters in connection with the Trust hereunder; and,
with the same effect as if it were the original, may rely on a copy certified by
an officer of the Trust to be a copy of this instrument or of any such
amendment. In this instrument or in any such amendment, references to this
instrument, and all expressions like "herein," "hereof," and "hereunder," shall
be deemed to refer to this instrument as amended or affected by any such
amendment. Headings are placed herein for convenience of reference only and in
case of any conflict, the text of this instrument, rather than the headings,
shall control. This instrument may be executed in any number of counterparts
each of which shall be deemed an original.
Section 7. Applicable Law. The Trust set forth in this instrument is
made in the State of Ohio and it is created under and is to be governed by and
construed and administered according to the laws of said state, including,
without limitation, Ohio Revised Code Chapter 1746. The Trust shall be of the
type commonly called an Ohio business trust, and without limiting the provisions
hereof, the Trust may exercise all powers which are ordinarily exercised by such
a trust.
Section 8. Amendments. This Declaration of Trust may be amended at any
time by an instrument in writing signed by a majority of the then Trustees when
authorized so to do by a vote of Shareholders holding a majority of the Shares
outstanding and entitled to vote, except that an amendment which shall affect
the holders of one or more series or class of Shares but not the holders of all
outstanding series or classes of Shares shall be authorized by vote of the
Shareholders holding a majority of the Shares entitled to vote of the series or
classes affected and no vote of Shareholders of a series or class not affected
shall be required. Amendments having the purpose of changing the name of the
Trust or of supplying any omission, curing any ambiguity or curing, correcting
or supplementing any defective or inconsistent provision contained herein shall
not require authorization by Shareholder vote.
Section 9. Counterparts. This Declaration of Trust may be
simultaneously executed in several counterparts, each of which shall be deemed
to be an original, and such counterparts, together, shall constitute one and the
same instrument, which shall be sufficiently evidenced by any such original
counterpart.
<PAGE>
IN WITNESS WHEREOF, the undersigned Trustees have hereunto set his hand
and seal for himself and him assigns as of the day and year first above written.
------------------------------------
Richard A. Barone, Trustee
------------------------------------
Denis J. Amato, Trustee
------------------------------------
Robert A. Schenkelberg, Jr., Trustee
<PAGE>
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named Richard A. Barone, who acknowledged that he did sign
the foregoing instrument, and that the same is his free act and deed.
IN TESTIMONY WHEREOF, I have set my hand and official seal this _____
day of November, 1997.
----------------------------------
NOTARY PUBLIC
(Notarial Seal)
<PAGE>
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named Denis J. Amato, who acknowledged that he did sign the
foregoing instrument, and that the same is his free act and deed.
IN TESTIMONY WHEREOF, I have set my hand and official seal this _____
day of November, 1997.
----------------------------------
NOTARY PUBLIC
(Notarial Seal)
<PAGE>
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named Robert A. Schenkelberg, Jr., who acknowledged that he
did sign the foregoing instrument, and that the same is his free act and deed.
IN TESTIMONY WHEREOF, I have set my hand and official seal this _____
day of November, 1997.
----------------------------------
NOTARY PUBLIC
(Notarial Seal)
<PAGE>
Exhibit 2
Adopted November 7, 1997
BY-LAWS
OF
MAXFUND TRUST
ARTICLE 1
Declaration of Trust and Principal Office
1.1. Agreement and Declaration of Trust. These By-Laws shall be subject
to the Declaration of Trust, as from time to time in effect (the "Declaration of
Trust"), of the above-captioned Ohio business trust established by the
Declaration of Trust (the "Trust").
1.2. Principal Office of the Trust. The principal office of the Trust
shall be located at such place within or outside the State of Ohio as the
Trustees from time to time may select.
ARTICLE 2
Meetings of Trustees
2.1. Regular Meetings. Regular meetings of the Trustees may be held
without call or notice at such places and at such times as the Trustees from
time to time may determine, provided that notice of the first regular meeting
following any such determination shall be given to absent Trustees.
2.2. Special Meetings. Special meetings of the Trustees may be held at
any time and at any place designated in the call of the meeting when called by
the President or the Treasurer or by two or more Trustees, sufficient notice
thereof being given to each Trustee by the Secretary or an Assistant Secretary
or by the officer or the Trustees calling the meeting.
2.3. Notice of Special Meetings. It shall be sufficient notice to a
Trustee of a special meeting to send notice by mail at least forty-eight hours
or by telegram at least twenty-four hours before the meeting addressed to the
Trustee at his or her usual or last known business or residence address or to
give notice to him or her in person or by telephone at least twenty-four hours
before the meeting. Notice of a meeting need not be given to any Trustee if a
written waiver of notice, executed by him or her before or after the meeting, is
filed with the records of the meeting, or to any Trustee who attends the meeting
without protesting prior thereto or at its commencement the lack of notice to
him or her. Neither notice of a meeting nor a waiver of a notice need specify
the purposes of the meeting.
2.4. Notice of Certain Actions by Consent. If in accordance with the
provisions of the Declaration of Trust any action is taken by the Trustees by a
written consent of less than all of the Trustees, then prompt notice of any such
action shall be furnished to each Trustee who did not execute such written
consent, provided that the effectiveness of such action shall not be impaired by
any delay or failure to furnish such notice.
<PAGE>
ARTICLE 3
Officers
3.1. Enumeration; Qualification. The officers of the Trust shall be a
President, a Treasurer, a Secretary, and such other officers, if any, as the
Trustees from time to time may in their discretion elect. The Trust also may
have such agents as the Trustees from time to time may in their discretion
appoint. Officers may be but need not be a Trustee or shareholder. Any two or
more offices may be held by the same person.
3.2. Election. The President, the Treasurer and the Secretary shall be
elected by the Trustees upon the occurrence of any vacancy in any such office.
Other officers, if any, may be elected or appointed by the Trustees at any time.
Vacancies in any such other office may be filled at any time.
3.3. Tenure. The President, Treasurer and Secretary shall hold office
in each case until he or she sooner dies, resigns, is removed or becomes
disqualified. Each other officer shall hold office and each agent shall retain
authority at the pleasure of the Trustees.
3.4. Powers. Subject to the other provisions of these By-Laws, each
officer shall have, in addition to the duties and powers herein and in the
Declaration of Trust set forth, such duties and powers as commonly are incident
to the office occupied by him or her as if the Trust were organized as an Ohio
business corporation or such other duties and powers as the Trustees may from
time to time designate.
3.5. President. Unless the Trustees otherwise provide, the President
shall preside at all meetings of the shareholders and of the Trustees. Unless
the Trustees otherwise provide, the President shall be the chief executive
officer.
3.6. Treasurer. The Treasurer shall be the chief financial and
accounting officer of the Trust, and, subject to the provisions of the
Declaration of Trust and to any arrangement made by the Trustees with a
custodian, investment adviser or manager, or transfer, shareholder servicing or
similar agent, shall be in charge of the valuable papers, books of account and
accounting records of the Trust, and shall have such other duties and powers as
may be designated from time to time by the Trustees or by the President.
3.7. Secretary. The Secretary shall record all proceedings of the
shareholders and the Trustees in books to be kept therefor, which books or a
copy thereof shall be kept at the principal office of the Trust. In the absence
of the Secretary from any meeting of the shareholders or Trustees, an Assistant
Secretary, or if there be none or if he or she is absent, a temporary Secretary
chosen at such meeting shall record the proceedings thereof in the aforesaid
books.
<PAGE>
3.8. Resignations and Removals. Any Trustee or officer may resign at
any time by written instrument signed by him or her and delivered to the
President or Secretary or to a meeting of the Trustees. Such resignation shall
be effective upon receipt unless specified to be effective at some other time.
The Trustees may remove any Officer elected by them with or without cause.
Except to the extent expressly provided in a written agreement with the Trust,
no Trustee or officer resigning and no officer removed shall have any right to
any compensation for any period following his or her resignation or removal, or
any right to damages on account of such removal.
ARTICLE 4
Committees
4.1. Appointment. The Trustees may appoint from their number an
executive committee and other committees. Except as the Trustees otherwise may
determine, any such committee may make rules for conduct of its business.
4.2. Quorum; Voting. A majority of the members of any Committee of the
Trustees shall constitute a quorum for the transaction of business, and any
action of such a Committee may be taken at a meeting by a vote of a majority of
the members present (a quorum being present).
ARTICLE 5
Reports
The Trustees and officers shall render reports at the time and in the
manner required by the Declaration of Trust or any applicable law. Officers and
Committees shall render such additional reports as they may deem desirable or as
may from time to time be required by the Trustees.
ARTICLE 6
Fiscal Year
The fiscal year of the Trust shall be fixed, and shall be subject to
change, by the Board of Trustees.
ARTICLE 7
Seal
The seal of the Trust shall consist of a flat-faced die with the word
"Ohio," together with the name of the Trust and the year of its organization cut
or engraved thereon but, unless otherwise required by the Trustees, the seal
shall not be necessary to be placed on, and in its absence shall not impair the
validity of, any document, instrument other paper executed and delivered by or
on behalf of the Trust.
<PAGE>
ARTICLE 8
Execution of Papers
Except as the Trustees generally or in particular cases may authorize
the execution thereof in some other manner, all deeds, leases, contracts, notes
and other obligations made by the Trustees shall be signed by the President, any
Vice President, or by the Treasurer and need not bear the seal of the Trust.
ARTICLE 9
Issuance of Share Certificates
9.1. Sale of Shares. Except as otherwise determined by the Trustees,
the Trust will issue and sell for cash or securities from time to time, full and
fractional shares of its shares of beneficial interest, such shares to be issued
and sold at a price of not less than net asset value per share as from time to
time determined in accordance with the Declaration of Trust and these By-Laws
and, in the case of fractional shares, at a proportionate reduction in such
price. In the case of shares sold for securities, such securities shall be
valued in accordance with the provisions for determining value of assets of the
Trust as stated in the Declaration of Trust and these By-Laws. The officers of
the Trust are severally authorized to take all such actions as may be necessary
or desirable to carry out this Section 9.1.
9.2. Share Certificates. In lieu of issuing certificates for shares,
the Trustees or the transfer agent either may issue receipts therefor or may
keep accounts upon the books of the Trust for the record holders of such shares,
who shall in either case, for all purposes hereunder, be deemed to be the
holders of certificates for such shares as if they had accepted such
certificates and shall be held to have expressly assented and agreed to the
terms hereof.
The Trustees at any time may authorize the issuance of share
certificates. In that event, each shareholder shall be entitled to a certificate
stating the number of shares owned by him, in such form as shall be prescribed
from time to time by the Trustees. Such certificate shall be signed by the
President or Vice President and by the Treasurer or Assistant Treasurer. Such
signatures may be facsimile if the certificate is signed by a transfer agent, or
by a registrar, other than a Trustee, officer or employee of the Trust. In case
any officer who has signed or whose facsimile signature has been placed on such
certificate shall cease to be such officer before such certificate is issued, it
may be issued by the Trust with the same effect as if he or she were such
officer at the time of its issue.
9.3. Loss of Certificates. The Trust, or if any transfer agent is
appointed for the Trust, the transfer agent with the approval of any two
officers of the Trust, is authorized to issue and countersign replacement
certificates for the shares of the Trust which have been lost, stolen or
destroyed subject to the deposit of a bond or other indemnity in such form and
with such security, if any, as the Trustees may require.
<PAGE>
9.4. Discontinuance of Issuance of Certificates. The Trustees at any
time may discontinue the issuance of share certificates and by written notice to
each shareholder, may require the surrender of share certificates to the Trust
for cancellation. Such surrender and cancellation shall not affect the ownership
of shares in the Trust.
ARTICLE 10
Indemnification
10.1. Trustees, Officers, etc. The Trust shall indemnify each of its
Trustees and officers (including persons who serve at the Trust's request as
directors, officers or trustees of another organization in which the Trust has
any interest as a shareholder, creditor or otherwise) (hereinafter referred to
as a "Covered Person") against all liabilities and expenses, including but not
limited to amounts paid in satisfaction of judgments, in compromise or as fines
and penalties, and counsel fees reasonably incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or having been
such a Trustee or officer, except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in a decision on the merits
in any such action, suit or other proceeding not to have acted in good faith in
the reasonable belief that such Covered Person's action was in the best
interests of the Trust and except that no Covered Person shall be indemnified
against an liability to the Trust or its Shareholders to which such Covered
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 Covered Person's office. Expenses, including counsel fees so incurred by
any such Covered Person (but excluding amounts paid in satisfaction of
judgments, in compromise or as fines or Penalties), may be paid from time to
time by the Trust in advance of the final disposition or any such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such Covered
Person to repay amounts so paid to the Trust if it is ultimately determined that
indemnification of such expenses is not authorized under this Article, provided
that (a) such Covered Person shall provide security for his undertaking, (b) the
Trust shall be insured against losses arising by reason of Such Covered Person's
failure to fulfill his undertaking, or (c) a majority of the Trustees who are
disinterested persons and who are not Interested Persons (as that term is
defined in the Investment Company Act of 1940) (provided that a majority of such
Trustees then in office act on the matter), or independent legal counsel in a
written opinion, shall determine, based on a review of readily available facts
(but not a full trial-type inquiry), that there is reason to believe such
Covered Person ultimately will be entitled to indemnification.
<PAGE>
10.2. Compromise Payment. As to any matter disposed of (whether by a
compromise payment, pursuant to a consent decree or otherwise) without an
adjudication in a decision on the merits by a court, or by any other body before
which the proceeding was brought, that such Covered Person either (a) did not
act in good faith in the reasonable belief that such Covered Person's action was
in the best interests of the Trust or (b) is liable to the Trust or its
Shareholders by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Covered
Person's office, indemnification shall be provided if (a) approved as in the
best interest of the Trust, after notice that it involves such indemnification,
by at least a majority of the Trustees who are disinterested persons and are not
Interested Persons (provided that a majority of such Trustees then in office act
on the matter), upon a determination based upon a review of readily available
facts (but not a full trial-type inquiry) that such Covered Person acted in good
faith in the reasonable belief that such Covered Person's action was in the best
interests of the Trust and is not liable to the Trust or its Shareholders by
reason of wilful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of such Covered Person's office, or (b)
there has been obtained an opinion in writing of independent legal counsel,
based upon a review of readily available facts (but not a full trial-type
inquiry) to the effect that such Covered Person appears to have acted in good
faith in the reasonable belief that such Covered Person's action was in the best
interests of the Trust and that such indemnification would not protect such
Covered Person against any liability to the Trust to which such Covered 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 his
office. Any approval pursuant to this Section shall not prevent the recovery
from any Covered Person of any amount paid to such Covered Person in accordance
with this Section as indemnification if such Covered Person is subsequently
adjudicated by a court of competent jurisdiction not to have acted in good faith
in the reasonable belief that such Covered Person's action was in the best
interests of the Trust or to have been liable to the Trust or its shareholders
by reason of wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's office.
10.3. Indemnification Not Exclusive. The right of indemnification
hereby provided shall not be exclusive of or affect any other rights to which
any such Covered Person may be entitled. As used in this Article 10, the term
"Covered Person" shall include such person's heirs, executors and
administrators, and a "disinterested person" is a person against whom none of
the actions, suits or other proceedings in question or another action, suit, or
other proceeding on the same or similar grounds is then or has been pending.
Nothing contained in this article shall affect any rights to indemnification to
which personnel of the Trust, other than Trustees and officers, and other
persons may be entitled by contract or otherwise under law, nor the power of the
Trust to purchase and maintain liability insurance on behalf of such person.
10.4. Limitation. Notwithstanding any provisions in the Declaration of
Trust and these By-Laws pertaining to indemnification, all such provisions are
limited by the following undertaking set forth in the rules promulgated by the
Securities and Exchange Commission:
<PAGE>
In the event that a claim for indemnification is asserted by a Trustee,
officer or controlling person of the Trust in connection with the registered
securities of the Trust, the Trust will not make such indemnification unless (i)
the Trust has submitted, before a court or other body, the question of whether
the person to be indemnified was liable by reason of wilful misfeasance, bad
faith, gross negligence, or reckless disregard of duties, and has obtained a
final decision on the merits that such person was not liable by reason of such
conduct or (ii) in the absence of such decision, the Trust shall have obtained a
reasonable determination, based upon a review of the facts, that such person was
not liable by virtue of such conduct, by (a) the vote of a majority of Trustees
who are neither interested persons as such term is defined in the Investment
Company Act of 1940, nor parties to the proceeding or (b) an independent legal
counsel in a written opinion.
The Trust will not advance attorneys' fees or other expenses incurred
by the person to be indemnified unless the Trust shall have (i) received an
undertaking by or on behalf of such person to repay the advance unless it is
ultimately determined that such person is entitled to indemnification and one of
the following conditions shall have occurred: (x) such person shall provide
security for his undertaking, (y) the Trust shall be insured against losses
arising by reason of any lawful advances or (z) a majority of the disinterested,
non-party Trustees of the Trust, or an independent legal counsel in a written
opinion, shall have determined that based on a review of readily available facts
there is reason to believe that such person ultimately will be found entitled to
indemnification.
ARTICLE 11
Shareholders
11.1. Meetings. A meeting of the shareholders shall be called by the
Secretary whenever ordered by the Trustees, or requested in writing by the
holder or holders of at least 10% of the outstanding shares entitled to vote at
such meeting. If the meeting is a meeting of the shareholders of one or more
series or class of shares, but not a meeting of all shareholders of the Trust,
then only the shareholders of such one or more series or classes shall be
entitled to notice of and to vote at the meeting. If the Secretary, when so
ordered or requested, refuses or neglects for more than five days to call such
meeting, the Trustees, or the shareholders so requesting may, in the name of the
Secretary, call the meeting by giving notice thereof in the manner required when
notice is given by the Secretary.
11.2. Access to Shareholder List. Shareholders of record may apply to
the Trustees for assistance in communicating with other shareholders for the
purpose of calling a meeting in order to vote upon the question of removal of a
Trustee. When ten or more shareholders of record who have been such for at least
six months preceding the date of application and who hold in the aggregate
shares having a net asset value of at least $25,000 or at least 1% of the
outstanding shares, whichever is less, so apply, the Trustees shall within five
business days either:
(i) afford to such applicants access to a list of names and
addresses of all shareholders as recorded on the books of the Trust; or
(ii) inform such applicants of the approximate number of
shareholders of record and the approximate cost of mailing material to
them and, within a reasonable time thereafter, mail, materials
submitted by the applicants, to all such shareholders of record. The
Trustees shall not be obligated to mail materials which they believe to
be misleading or in violation of applicable law.
<PAGE>
11.3. Record Dates. For the purpose of determining the shareholders of
any series or class who are entitled to vote or act at any meeting or any
adjournment thereof, or who are entitled to receive payment of any dividend or
of any other distribution, the Trustees from time to time may fix a time, which
shall be not more than 90 days before the date of any meeting of shareholders or
the date of payment of any dividend or of any other distribution, as the record
date for determining the shareholders of such series or class having the right
to notice of and to vote at such meeting and any adjournment thereof or the
right to receive such dividend or distribution, and in such case only
shareholders of record or such record date shall have such right notwithstanding
any transfer of shares on the books of the Trust after the record date; or
without fixing such record date the Trustees may for any such purposes close the
register or transfer books for all or part of such period.
11.4. Place of Meetings. All meetings of the shareholders shall be held
at the principal office of the Trust or at such other place within the United
States as shall be designated by the Trustees or the President of the Trust.
11.5. Notice of Meetings. A written notice of each meeting of
shareholders, stating the place, date and hour and the purposes of the meeting,
shall be given at least ten days before the meeting to each shareholder entitled
to vote thereat by leaving such notice with him or at his residence or usual
place of business or by mailing it, postage prepaid, and addressed to such
shareholder at his address as it appears in the records of the Trust. Such
notice shall be given by the Secretary or an Assistant Secretary or by an
officer designated by the Trustees. No notice of any meeting of shareholders
need be given to a shareholder if a written waiver of notice, executed before or
after the meeting by such shareholder or his attorney thereunto duly authorized,
is filed with the records of the meeting.
11.6. Ballots. No ballot shall be required for any election unless
requested by a shareholder present or represented at the meeting and entitled to
vote in the election.
11.7. Proxies. Shareholders entitled to vote may vote either in person
or by proxy in writing dated not more than six months before the meeting named
therein, which proxies shall be filed with the Secretary or other person
responsible to record the proceedings of the meeting before being voted. Unless
otherwise specifically limited by their terms, such proxies shall entitle the
holders thereof to vote at any adjournment of such meeting but shall not be
valid after the final adjournment of such meeting.
ARTICLE 12
Amendments to the By-Laws
These By-Laws may be amended or repealed, in whole or in part, by a
majority of the Trustees then in office at any meeting of the Trustees, or by
one or more writings signed by such a majority.
<PAGE>
Exhibit 5
INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENT
November 19, 1997
Maxus Asset Management Inc.
28601 Chagrin Boulevard
Cleveland, OH 44122
Dear Sirs:
MaxFund Trust, an Ohio business trust (the "Trust"), herewith confirms
its agreement with you ("MAM") as follows:
The Trust desires to employ its capital by investing and reinvesting
the same in investments of the type and in accordance with the limitations
specified in its Prospectus as from time to time in effect, copies of which have
been or will be submitted to MAM, and in such manner and to such extent as may
from time to time be approved by the Board of Trustees of the Trust. The Trust
desires to employ MAM to act as the investment adviser and administrator for its
investment portfolios Maxus Ohio Heartland Fund, Maxus Aggressive Value Fund and
such other investment portfolios as the Trust may from time to time create
(individually, a "Fund" or collectively, the "Funds").
Subject to the supervision and approval of the Board of Trustees, MAM
will provide investment management of each Fund's portfolio in accordance with
each Fund's investment objective and policies as stated in its most recent
Prospectus delivered to MAM, upon which MAM shall be entitled to rely. In
connection therewith, MAM will provide investment research and supervision of
each Fund's investments and conduct a continuous program of investment,
evaluation and, if appropriate, sale and reinvestment of the Fund's assets. MAM
will furnish to the Trust such statistical information with respect to the
investments which each Fund may hold or contemplate purchasing as the Trust may
reasonably request. The Board wishes to be kept in touch with important
developments materially affecting its portfolio and shall expect MAM, on its own
initiative, to furnish to the Board from time to time such information as MAM
may believe appropriate for this purpose.
<PAGE>
In providing investment management services to the Trust, MAM shall
give primary consideration to securing the most favorable price and efficient
execution. In so doing, MAM may consider the financial responsibility, research
and investment information and other services provided by brokers or dealers who
may effect or be a party to any such transaction or other transactions to which
other clients of MAM may be a party. The Trust recognizes that it is desirable
that MAM have access to supplemental investment and market research and security
and economic analyses provided by brokers and that such brokers may execute
brokerage transactions at a higher cost to the Trust than may result when
allocating brokerage to other brokers on the basis of seeking the most favorable
price and efficient execution. Therefore, MAM is authorized to pay higher
brokerage commissions for the purchase and sale of securities for each Fund to
brokers who provide such research and analyses, subject to review by the Board
of Trustees from time to time with respect to the extent and continuation of
this practice. It is understood that the services provided by such brokers may
be useful to MAM in connection with its services to other clients.
On occasions when MAM deems the purchase or sale of a security to be in
the best interest of each Fund as well as other clients, MAM, to the extent
permitted by applicable laws and regulations, may aggregate the securities to be
sold or purchased in order to obtain the most favorable price or lower brokerage
commissions and efficient execution. In such event, allocation of the securities
so purchased or sold, as well as the expenses incurred in the transaction, will
be made by MAM in the manner it considers to be the most equitable and
consistent with its fiduciary obligations to the Fund and to such other clients.
MAM shall provide the Trust with such office facilities and clerical
and administrative services necessary to manage the business affairs of the
Trust. In addition, MAM will prepare and file various returns, reports and
registrations required by Federal and state law and respond to shareholder
communications. Subject to the direction of the Board of Trustees, MAM shall be
responsible for the overall management of the business affairs of the Trust.
MAM shall exercise its best judgment in rendering to the Trust the
services described above and the Trust agrees as an inducement to MAM's
undertaking the same that MAM shall not be liable hereunder for any mistake of
judgment or in any other event whatsoever, provided that nothing herein shall be
deemed to protect or purport to protect MAM against any liability to the Trust
or to its security holders to which MAM would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties hereunder, or by reason of MAM's reckless disregard of its obligations
and duties hereunder.
MAM shall, at its own expense, maintain such staff and employ or retain
such personnel and consult with such other persons as it shall from time to time
determine to be necessary or useful to the performance of its obligations under
this Agreement. Without limiting the generality of the foregoing, the staff and
personnel of MAM shall be deemed to include persons employed or otherwise
retained by MAM to furnish statistical and other factual data, advice regarding
economic factors and trends, information with respect to technical and
scientific developments, and such other information, advice and assistance as
MAM may desire. MAM shall, as agent for the Trust, maintain the Trust's records
and books of account (other than those maintained by the Fund's transfer agent,
registrar, custodian and other agencies), including records of portfolio
transactions. All such books and records so maintained shall be the property of
each Fund and, upon request therefore, MAM shall surrender to such Fund such of
the books and records so requested.
<PAGE>
MAM shall bear the cost of rendering the investment management,
supervisory and administrative services to be performed by it under this
Agreement, and shall, at its own expense, pay the compensation of the officers
and employees, if any, of the Trust who are employees of MAM, and provide such
office space, facilities and equipment, such clerical help and accounting, data
processing, bookkeeping and internal auditing services as the Trust shall
reasonably require in the conduct of its business and the cost of telephone
service, heat, light, power and other utilities provided to the Trust. The Trust
shall bear all other expenses to be incurred in the operation of the Trust,
including charges and expenses of any registrar, custodian, stock transfer and
dividend disbursing agent; brokerage commissions; taxes; engraving and printing
stock certificates, if any; registration costs of the Trust and its shares under
Federal and state securities laws; the cost and expense of printing, including
typesetting, and distributing prospectuses of the Trust and supplements thereto
to the Trust's shareholders; all expenses of shareholders' and trustees'
meetings and of preparing, printing and mailing proxy statements and reports to
shareholders; fees and travel expenses of trustees' or members of any advisory
board or committee who are not employees of MAM or any corporate affiliate of
MAM; all expenses incident to any dividend, withdrawal or redemption options;
charges and expenses of any outside service used for pricing of each Fund's
portfolio securities; fees and expenses of legal counsel, including counsel to
the trustees who are not interested persons of the Trust or of MAM and
independent accountants; membership dues of industry associations; interest on
Fund borrowings; postage; liability insurance premiums on property or personnel
(including officers and trustees) of the Trust which inure to their benefit; and
extraordinary expenses (including, but not limited to, legal claims and
liabilities and litigation costs and any indemnification relating thereto).
In consideration of services rendered pursuant to this Agreement, the
Trust will pay MAM on the first business day of each month a fee at the annual
rate of one percent (1%) of the average value of each Fund's daily net assets up
to One Hundred Fifty Million Dollars ($150,000,000) and seventy-five hundredths
percent (0.75%) of the average value of each Fund's daily net assets in excess
of One Hundred Fifty Million Dollars ($150,000,000). Net asset value shall be
computed at least once each business day. The fee for the period from the date
the initial registration statement of the Fund is declared effective by the
Securities and Exchange Commission to the end of the month during which such
initial registration shall have been declared effective by the Securities and
Exchange Commission shall be prorated according to the proportion which such
period bears to the full monthly period, and upon any termination of this
Agreement before the end of any month, such fee for such part of a month shall
be prorated according to the proportion which such period bears to the full
monthly period and shall be payable upon the date of termination of this
Agreement. For the purpose of determining fees payable to MAM, the value of each
Fund's net assets shall be computed in the manner specified in such Fund's
Prospectus for the computation of the value of such net assets.
<PAGE>
The Trust understands that MAM now acts and will continue to act as
investment adviser to various fiduciary or other managed accounts, and the Trust
has no objection to MAM's so acting. In addition, it is understood that the
persons employed by MAM to assist in the performance of its duties hereunder
will not devote their full time to such service and nothing contained herein
shall be deemed to limit or restrict the right of MAM or any affiliate of MAM to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
The Trust understands that MAM now acts and may in the future act as
investment adviser to one or more other investment companies, and the Trust has
no objection to MAM's so acting, provided that when two or more companies
managed by MAM have available funds for investment in money market instruments,
available money market investments will be allocated in accordance with a
formula believed to be equitable to each company. It is recognized that in some
cases this procedure may adversely affect the size of the position obtainable
for the Funds.
MAM shall not be liable for any error of judgment or mistake of law or
for any loss suffered by any Fund in connection with the matters to which this
Agreement relates, except for a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations and duties under this Agreement. Any
person, even though also an officer, partner, employee, or agent of MAM who may
be or become an officer, trustee, employee or agent of the Trust, shall be
deemed, when rendering services to the Trust or acting on any business of the
Trust, to be rendering such services to, or acting solely for, the Fund and not
as an officer, partner, employee, or agent or one under the control or direction
of MAM even though paid by it.
This Agreement shall become effective on the date hereof and shall
continue in force for a period of two (2) years and from year to year
thereafter, provided such continuance is specifically approved at least annually
by (i) the Board of Trustees or (ii) as to any Fund, by a vote of a majority (as
defined in the Investment Company Act of 1940, as amended) of such Fund's
outstanding voting securities; provided that in either event the continuance is
also approved by a majority of the Trustees who are not "interested persons" (as
defined in said Act) of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This Agreement is
terminable without penalty, at any time by (i) the Board of Trustees or (ii) as
to any Fund, by vote of holders of a majority of such Fund's shares or by (iii)
MAM. This Agreement will also terminate automatically in the event of its
assignment (as defined in said Act).
Pursuant to the Trust's Declaration of Trust dated November 7, 1997,
neither the Trustees, shareholders, officers, employees or agents of the Trust
shall be personally liable upon, nor shall resort be had to their private
property for the satisfaction of, any obligations of the Trust hereunder, and
MAM shall look solely to the property of the Trust for the satisfaction of any
claim hereunder.
<PAGE>
If the foregoing is in accordance with your understanding, kindly so
indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
MAXFUND TRUST
By:__________________________________
Accepted: Richard A. Barone, Chairman
MAXUS ASSET MANAGEMENT INC.
By:______________________________
<PAGE>
