SCHEDULE 14A(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
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(Name of Registrant as Specified in Its Charter)
STOCKCAR STOCKS MUTUAL FUNDS, INC.
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
NOT APPLICABLE
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<PAGE>
IMPORTANT NEWS
FOR STOCKCAR STOCKS MUTUL FUNDS, INC. SHAREHOLDERS
As a shareholder of the StockCar Stocks Index Fund (the "Fund"), your vote is
being solicited on a matter that will have an effect on the future of your Fund.
These questions and answers are designed to give you a brief overview of the
matter to be voted on by this proxy. However, we encourage you to also read the
full text of the enclosed proxy statement to understand fully what is happening,
and why your vote is being solicited.
Q & A ABOUT THE ENCLOSED PROXY MATERIALS
Q. WHAT IS HAPPENING?
A. The Board of Directors of your Fund has voted to implement a Plan of
Distribution Pursuant to Rule 12b-1 of the Investment Company Act of 1940*
(the "12b-1 Plan"), and the Plan requires the approval of the Fund's
shareholders before it can be put into effect.
Q. WHY AM I BEING ASKED TO VOTE ON A PROPOSED NEW 12B-1 DISTRIBUTION PLAN?
A. The Investment Company Act of 1940 requires a vote of the shareholders of a
fund whenever a fund desires to implement a 12b-1 Plan.
Normally, the more money a mutual fund has in its asset base, the lower its
overall expense ratios can be. A mutual fund gets assets from a number of
sources, including brokers, dealers and other financial professionals that
buy the mutual fund's shares for their clients. A 12b-1 Plan is the only
legal way that a mutual fund can pay these persons to perform services that
are designed to sell shares of a mutual fund.
Your Board decided to implement the 12b-1 Plan primarily to better enable
the Fund to attract new shareholders to the Fund. The Board, in the
exercise of its reasonable business judgement, has concluded that
implementing a 12b-1 Plan will better enable the Fund to attract new
shareholders, and that the resulting increase in Fund assets will benefit
all shareholders by decreasing the expense ratios of the Fund due to an
increase in the Fund's assets. The Board has approved the 12b-1 Plan, and
now is asking you to approve it as well.
Q. HOW WILL THE 12B-1 PLAN AFFECT ME AS A FUND SHAREHOLDER?
A. Your Fund and your Fund's investment adviser will not change. You will
still own the same shares in the same Fund.
Q. WILL THE OVERALL FEES CHARGED BY THE FUND STAY THE SAME?
A. YES. Your Fund pays fees in three major categories:
1. The Fund pays an investment advisory fee to the Fund's investment
adviser. Those investment advisory fees will stay the same.
2. If you approve the 12b-1 Plan, your Fund will pay 12b-1 Plan fees of
0.25% of the Fund's average net assets per year. The Fund has not paid
these fees in the past.
3. Your investment adviser is paid an operational services fee for
providing a wide variety of operating services to the Fund. At your
investment adviser's request, the Board has voted to reduce those fees
by the amount of the new 12b-1 Plan fees.
Because the Fund is lowering its operating service fees by the same amount
as the new 12b-1 Plan fees, your overall expenses will stay exactly the
same.
Q. HOW DO THE BOARD MEMBERS OF MY FUND SUGGEST THAT I VOTE?
A. After careful consideration, the Board members of your Fund, including the
independent members, recommend that you vote to "APPROVE" the 12b-1 Plan on
the enclosed ballot.
Q. WHO IS PAYING THE COST OF THE SHAREHOLDER MEETING AND THIS PROXY
SOLICITATION?
A. StockCar Stocks Advisors, LLC. -- not your Fund -- is paying all costs of
the Fund's shareholder meeting and proxy solicitation.
Q. WHOM DO I CALL FOR MORE INFORMATION?
A. Please call Shareholder Services at 1-800-494-2755
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* Rule 12b-1 of the Investment Company Act of 1940 sets forth the terms under
which an investment company (mutual fund) may use fund assets to pay for the
distribution of fund shares.
<PAGE>
ABOUT THE BALLOT
Shown below is the ballot that you will use to vote on the matter described
above and hereafter in these proxy materials.
1. Approve a new Rule 12b-1 Distribution Plan for No-Load Direct Shares of the
StockCar Stocks Index Fund.
Approve Reject Abstain
/ / / / / /
Signature(s) (All registered owners of accounts shown to the left must sign. If
signing for a corporation, estate or trust, please indicate your capacity or
title.)
X
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Signature Date
X
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Signature Date
PLEASE VOTE TODAY!
Please indicate your vote by using blue or black ink to mark an X in one of the
three boxes provided on your ballot. Mark - Approve, Reject, or Abstain. Then
sign, date and return your ballot in the accompanying postage-paid envelope. All
registered owners of an account, as shown in the address on the ballot, must
sign the ballot. If you are signing for a corporation, trust or estate, please
indicate your title or position.
THANK YOU FOR MAILING YOUR BALLOT PROMPTLY!
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<PAGE>
StockCar Stocks Mutual Funds, Inc.
256 Raceway Drive, Suite 11
Mooresville, North Carolina 28117
TELEPHONE 1-800-494-2755
May 3, 1998
Dear Shareholder:
As you read in the Questions and Answers (Q & A) on page 1, the Board of
Directors of your Fund has determined that it would be in the best interests of
your Fund to implement a 12b-1 Plan.
We're sending this proxy statement to you because your vote is required to
approve the new Plan. As you review these materials, please keep in mind that if
the new 12b-1 Plan is approved, YOUR FUND SHARES WILL NOT CHANGE, THE ADVISORY
FEES CHARGED TO YOUR FUND WILL STAY THE SAME, AND THE OVERALL FEES AND EXPENSES
OF THE FUND WILL STAY THE SAME. If you approve the new 12b-1 Plan, you should
continue to receive the high quality investment management and shareholder
services that you have come to expect, AND YOU WILL HELP THE Fund to attract
additional shareholders.
Your Fund Board has approved the 12b-1 Plan and recommends it for your approval.
I encourage you to vote to "APPROVE" the 12b-1 Plan.
PLEASE VOTE NOW TO HELP SAVE THE COST OF ADDITIONAL SOLICITATIONS.
As always, we thank you for your confidence and support.
Sincerely,
John P. Allen III
President, Board of Directors
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<PAGE>
STOCKCAR STOCKS MUTUAL FUNDS, INC.
256 Raceway Drive, Suite 11
Mooresville, North Carolina 28117
1-800-494-2755
NOTICE OF JOINT SPECIAL MEETING OF SHAREHOLDERS
MAY 26, 1999 AND PROXY STATEMENT
May 3, 1999
To the Shareholders:
You are invited to attend a joint special meeting of shareholders of the
StockCar Stocks Index Fund (the "Fund"), a series of StockCar Stocks Mutual
Funds, Inc. (the "Company").
The meeting will be held at 256 Raceway Drive, Suite 11, Mooresville, NC 28117,
on Wednesday, May 26, 1999 at 9:00 a.m., Eastern time, for the following
purposes and to transact such other business as may properly come before the
meeting or any adjournment of the meeting:
1. To approve a new Rule 12b-1 Distribution Plan (the "12b-1 Plan") for
No-Load Direct Class Shares of the Fund.
The Board of Directors of the Company has selected the close of business on
April 30, 1999 as the record date for the determination of shareholders of the
Fund entitled to notice of and to vote at the meeting. Shareholders are entitled
to one vote for each share held.
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PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD. SIGN, DATE
AND RETURN IT IN THE ENVELOPE PROVIDED. TO SAVE THE COST OF ADDITIONAL
SOLICITATIONS, PLEASE MAIL YOUR PROXY PROMPTLY.
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The accompanying proxy is solicited by the Board of Directors (the "Board") of
the Company for voting at the joint special meeting of shareholders of the
Company to be held on Wednesday, May 26, 1999, and at any and all adjournments
thereof (the "Shareholder Meeting"). This proxy statement was first mailed to
shareholders on or about May 3, 1999.
THE SERIES FUNDS. StockCar Stocks Mutual Funds, Inc.(the "Company") is a "series
company" that is authorized to issue various series of shares. (Each series of
the Company is a "Fund.") Each series has its own investment objective and
policies and operates independently for purposes of investments, dividends and
redemptions.
Presently, the Company offers a single series, the StockCar Stocks Index Fund
(the "Fund").
The Fund presently is divided into two classes of shares; No-Load Direct Shares
and Advisor Shares. Shares of each Class represent a proportionate interest in
that Class. The Company is in the process of registering Advisor Shares with the
Securities and Exchange Commission (the "SEC"), so Advisor Shares have not yet
been offered to the public. Because the Fund did not offer Advisor Shares prior
to April 30, 1999, this proxy only applies to No-Load Direct Shareholders (the
"Shareholders").
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As a Shareholder, you are being asked to vote on a single item, approval of a
new Rule 12b-1 Plan for the No-Load Direct Share Class. Your Board has approved
the 12b-1 Plan and recommends that you vote to "APPROVE" the Plan. The vote
required to approve the 12b-1 Plan is described under the section of this proxy
statement entitled "Miscellaneous."
Your Board has fixed the close of business on April 30, 1999 as the record date
for the determination of Shareholders of the Fund entitled to notice of and to
vote at the Meeting. As of April 30, 1999, the Fund had the following No-Load
Direct Shares issued and outstanding:
FUND NO-LOAD DIRECT CLASS
- ---- --------------------
StockCar Stocks Index Fund 114,518
As of April 30, 1999, no shareholder of the Fund owned more than five percent
(5%) of the Fund's issued and outstanding shares.
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ITEM 1. NEW RULE 12B-1 DISTRIBUTION PLAN
INTRODUCTION
Rule 12b-1 under the 1940 Act (the "Rule"), provides, among other things, that
an investment company (mutual fund) may bear expenses of distributing its shares
only pursuant to a plan (a "12b-1 Plan") adopted in accordance with the Rule.
On April 29, 1999, the Board, including a majority of the "non-interested"
Directors, voted to approve a new 12b-1 Plan for No-Load Direct Class Shares,
and directed that the 12b-1 Plan be submitted to the Shareholders of the Fund at
the Shareholder Meeting, along with a recommendation that the Shareholders
approve the 12b-1 Plan.
If the new Rule 12b-1 Plan is approved, it will become effective immediately. If
the Shareholders do not approve the new 12b-1 Plan, the Board will consider
appropriate action.
DESCRIPTION OF THE NEW 12B-1 PLAN
A form of the new 12b-1 Plan is attached as Exhibit A to this proxy and this
summary is qualified in its entirety by reference to Exhibit A.
Under the new 12b-1 Plan, the Fund's investment adviser, StockCar Stocks
Advisors, LLC (the "Adviser") will receive a distribution fee, payable as an
expense of the No-Load Direct Class Shares of the Fund (the "Shares"), which the
Adviser will use to pay for distribution services. The Adviser will bear all the
expenses of providing such services, including the payment of any commissions or
distribution fees. The Adviser provides for the preparation of advertising or
sales literature and bears the cost of printing and mailing prospectuses to
persons other than shareholders.
2
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The Adviser bears the cost of qualifying and maintaining the qualification of
Shares for sale under the securities laws of the various states, and bears the
expense of registering the Fund's Shares with the SEC.
The Adviser may authorize Declaration Distributors, Inc., the Fund's principal
underwriter ("DDI"), to enter into related selling group agreements with various
broker-dealers, including affiliates of DDI, that provide distribution services
to investors. DDI also may provide some of the distribution services. (See
"Other Information - -- Underwriter" below.) As part of those selling group
agreements, the Adviser may assign some or all of the fees payable under the
12b-1 Plan to the broker/dealers who sell Shares of the Fund.
No-Load Direct Class Shares are sold to the public at net asset value. The
Adviser will receive a distribution fee, payable monthly for as long as the
shares are owned, at the annual rate of 0.25% of average daily net assets
attributable to the Shares. Under the new 12b-1 Plan, for Shares sold by broker,
dealers, and other financial services professionals, the Adviser may assign
payment of 12b-1 fees attributable to those Shares to the brokers, dealers and
other financial services professionals who sold the Shares.
The new 12b-1 Plan for the Shares will continue in effect for an initial term of
one year, and may continue thereafter from year to year if specifically approved
at least annually by vote of:
1. by majority vote of the Board, and
2. the vote of a majority of the "non interested" Directors, cast in person at
a meeting called for such purpose.
Pursuant to the new 12b-1 Plan, the Adviser will prepare reports to the Board on
a quarterly basis for the Fund's No-Load Direct Class Shares showing the amounts
paid to the various firms and such other information as from time to time the
Board may reasonably request.
In approving the new 12b-1 Plan, the Board determined that there is a reasonable
likelihood that the new 12b-1 Plan would benefit the Company, the Fund and its
Shareholders. In doing so, the Board considered several factors, including that
the new 12b-1 Plan would:
(i) enable investors to choose the purchasing option best suited to their
individual situations, thereby encouraging current shareholders to make
additional investments in SBGMF and attracting new investors and assets to
SBGMF. The resulting increase in Fund assets would benefit the Fund and
its shareholders through reduced overall expense ratios,
(ii) facilitate distribution of the Fund's Shares by allowing the Fund to pay
third parties for their efforts to distribute the Fund's shares,
(iii) help maintain the competitive position of the Company in relation to other
funds that have implemented or are seeking to implement similar
distribution arrangements by placing the Fund in the same competitive
position as its peer funds that offer a Plan; and
3
<PAGE>
(iv) permit possible economies of scale, such as a reduction in overall
expenses, increased Fund subscriptions from third party distribution, and
decreased transaction expenses through increased Fund size.
At its meeting on April 29, 1999, the Board also considered the effects of the
new 12b-1 Plan on the expenses of the Fund. By approving the new 12b-1 Plan, the
Board realized that the expenses of the Fund would increase by 0.25% of the
average net assets of the Fund, annually. The Board discussed at length the
advantages and disadvantages of the new 12b-1 Plan as the Plan related to
overall Fund expenses. The Board considered a number of options with respect to
ways in which to minimize the effects of the new 12b-1 Plan fees.
During its deliberations, the Board solicited information from its legal
counsel, underwriter and the Adviser. The Adviser reminded the Board that
presently the Fund pays fees to the Adviser for investment advisory services and
operating services. The fees payable to the Adviser for operating services may
not be used to pay for services designed to sell shares of the Fund. If the new
12b-1 Plan were approved, fees would then be available to pay for such services.
As the assets of the Fund grew, the Fund's operational expenses should decline.
Accordingly, the Adviser recommended that the Board reduce fees payable under
the Fund's Operating Services Agreement to the Adviser by an amount equal to the
new 12b-1 Plan fees. The result of such an action would be to maintain the
Fund's overall operating expenses at their current levels. The Adviser assured
the Board that it would continue to provide the same level of services to the
Fund if the Operating Services fees were reduced.
After full deliberation, the Board accepted the Adviser's recommendation and
voted to amend the Fund's Operating Services Agreement as recommended by the
Adviser. However, the Board made its vote contingent upon Shareholder approval
of the new 12b-1 Plan. If the Shareholders failed to approve the new 12b-1 plan,
fees payable under the Fund's Operating Services Agreement would remain at
current levels.
The table below shows how the Fund's expenses are structured currently and with
the new 12b-1Plan. All fees are payable monthly and computed on an annual basis
as a percentage of average net assets:
Current Fee Structure New Fee Structure
--------------------- -----------------
1. Investment Advisory Fees 0.50% 0.50%
2. Operational Services Fees 0.91% 0.66%
3. Distribution (12b-1) Fees ----- 0.25%
4. Other Fees 0.09% 0.09%
----- -----
Total Annual Fund Operating Expenses 1.50% 1.50%
BOARD OF DIRECTORS RECOMMENDATION
As a result of their consideration of the foregoing factors, the Board voted to
approve the new 12b-1 Plan and to submit it to the Shareholders for their
approval.
The Board recommends that you vote to "APPROVE" the new 12b-1 Plan.
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4
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OTHER INFORMATION
UNDERWRITER.
Declaration Distributors, Inc. ("DDI") acts as principal underwriter for the
Company's Shares. DDI is a broker/dealer registered as such with the Securities
and Exchange Commission, and is a member in good standing of the National
Association of Securities Dealers. DDI has been providing underwriting services
to mutual fund companies for ten years. DDI is a wholly-owned subsidiary of
Declaration Holdings, Inc. ("DHI"), a Delaware corporation.
Declaration Service Company ("DSC"), another wholly-owned subsidiary of DHI,
provides transfer agency, accounting and administrative services to mutual fund
companies, including the Company.
No-Load Direct Class Shares. The Fund's No-Load Direct Class Shares are sold to
the public at net asset value. DDI receives from the Adviser a flat fee of
$20,000 per annum for its services as principal underwriter for all Classes of
Fund Shares. The Company receives in all cases the full net asset value of the
shares sold.
MISCELLANEOUS
General
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The cost of preparing, printing and mailing the enclosed proxy, accompanying
notice and proxy statement and all other costs in connection with solicitation
of proxies will be paid by the Adviser, including any additional solicitation
made by letter, telephone or telegraph. In addition to solicitation by mail,
certain officers and representatives of the Company, officers and employees of
the Adviser and certain financial services firms and their representatives, who
will receive no extra compensation for their services, may solicit proxies by
telephone, telegram or personally. In addition, the Company and/or the Adviser
may retain a firm to solicit proxies on behalf of the Board, the fee for which
will be borne by the Adviser.
A copy of your Fund's most recent Semi-Annual Report, dated March 31, 1999, is
available without charge upon request by writing to Stockcar Stocks Mutual
Funds, Inc., c/o Declaration Service Company, 555 North Lane, Suite 6160,
Conshohocken, Pa 19428, or by calling 1-626-844-1446.
The Fund has not yet completed its first full year of operations. The Fund's
first audited annual report will be available approximately sixty days after the
Fund completes its first year of operations on September 30, 1999.
Proposals Of Shareholders
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As a Maryland Corporation, the Company is not required to hold annual
shareholder meetings unless required under the 1940 Act, but will hold special
meetings as required or deemed desirable. Since the Company does not hold
regular meetings of shareholders, the anticipated date of the next special
shareholders meeting cannot be provided. Any shareholder proposal that may
properly be included in the proxy solicitation material for a special
shareholder meeting must be received by the Company no later than four months
prior to the date when proxy statements are mailed to shareholders.
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Other Matters To Come Before The Meeting
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The Board of Directors of the Company is not aware of any matters that will be
presented for action at the Meeting other than the matter set forth herein.
Should any other matters requiring a vote of shareholders arise, the proxy in
the accompanying form will confer upon the person or persons entitled to vote
the shares represented by such proxy the discretionary authority to vote the
shares as to any such other matters in accordance with their best judgment in
the interest of the Company.
Voting, Quorum
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Each share of the Fund is entitled to one vote on each matter submitted to a
vote of the holders of that class of shares of the Fund at the Meeting; no
shares have cumulative voting rights.
Each valid proxy will be voted in accordance with the instructions on the proxy
and as the persons named in the proxy determine on such other business as may
come before the Meeting. If no instructions are given, the proxy will be voted
to "APROVE" the new 12b-1 Plan.
Shareholders who execute proxies may revoke them at any time before they are
voted, either by writing to the Company or in person at the time of the Meeting.
Proxies given by telephone or electronically transmitted instruments may be
counted if obtained pursuant to procedures designed to verify that such
instructions have been authorized.
Item 1 (approval of new 12b-1 Plan) requires the affirmative vote of a "majority
of the outstanding voting securities" of the No-load Direct Class Shares to
which the 12b-1 Plan applies. The term "majority of the outstanding voting
securities" as defined in the 1940 Act means: the affirmative vote of the lesser
of (1) 67% of the voting securities of the Fund present at the meeting if more
than 50% of the outstanding shares of the Fund are present in person or by proxy
or (2) more than 50% of the outstanding shares of the Fund.
The Fund presently offers only No-Load Direct Shares to the public, and the new
12b-1 Plan applies only to no-Load Direct Shares. Accordingly, all present
shareholders of the Fund are entitled to vote on the new 12b-1 Plan.
The Articles of Incorporation and By-Laws of the Company provide that the
presence at a shareholder meeting in person or by proxy of at least 33.3% of the
shares of a series constitutes a quorum for that series. Thus, the meeting for a
particular series could not take place on its scheduled date if less than 33.3%
of the shares of that series were represented.
If, by the time scheduled for the meeting, a quorum of shareholders of a series
is not present or if a quorum is present but sufficient votes in favor of any of
the items are not received, the persons named as proxies may propose one or more
adjournments of the meeting for that series to permit further soliciting of
proxies from its shareholders. Any such adjournment will require the affirmative
vote of a majority of the shares of the series as to which the meeting is being
adjourned present (in person or by proxy) at the session of the meeting to be
adjourned. The persons named as proxies will vote in favor of any such
adjournment if they determine that such adjournment and additional solicitation
are reasonable and in the interest of the respective series' shareholders.
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In tallying shareholder votes, abstentions and "broker non-votes" (i.e., shares
held by brokers or nominees as to which (i) instructions have not been received
from the beneficial owners or persons entitled to vote and (ii) the broker or
nominee does not have discretionary voting power on a particular matter) will be
counted for purposes of determining whether a quorum is present for purposes of
convening the Meeting. Abstentions and broker non-votes will be considered to be
both present at the Meeting and issued and outstanding and, as a result, will
have the effect of being counted as voted to "REJECT" the new 12b-1 Plan.
The Board of Directors of the Company recommends that you vote to "APPROVE" the
new 12b-1 Plan.
PLEASE COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY. NO POSTAGE IS
REQUIRED IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors,
John P. Allen III
President
<PAGE>
EXHIBIT A
FORM OF
PLAN PURSUANT TO RULE 12B-1
PLAN OF DISTRIBUTION PURSUANT TO RULE 12B-1
FOR NO-LOAD DIRECT CLASS SHARES
OF THE STOCKCAR STOCKS MUTUAL FUND, INC.
ADOPTED APRIL 29, 1999
RECITALS
1. STOCKCAR STOCKS MUTUAL FUND, INC. a corporation operating under the laws of
the State of Maryland (the "Company") is engaged in business as an open-end
management investment company and is registered as such under the Investment
Company Act of 1940, as amended (the "Act").
2. The Company operates as a "series company" within the meaning of Rule 18f-2
under the Act and is authorized to issue shares of beneficial interest in
various series (collectively the "Funds").
3. The Company presently offers one Fund, The StockCar Stocks Index Fund (the
"Fund"). This Plan applies to No-Load Direct Class shares offered by the Fund.
4. The Fund may utilize Fund assets to pay for sales or promotional services or
activities that have been or will be provided in connection with distribution of
No-Load Direct Class shares of the Fund if such payments are made pursuant to a
Plan adopted and continued in accordance with Rule 12b-1 under the Act.
5. The Fund , by virtue of such arrangement may be deemed to act as distributors
of its shares as provided in Rule 12b-1 under the Act and desires to adopt a
Plan pursuant to such Rule (the "Plan").
6. The Directors as a whole, and the Directors who are not interested persons of
the Company (as defined in the Act) and who have no direct or indirect financial
interest in the operation of this Plan and any agreements relating to it (the
"Qualified Directors"), have determined, in the exercise of reasonable business
judgement and in light of their fiduciary duties under state law and under
Section 36(a) and (b) of the Act, that there is a reasonable likelihood that the
Plan will benefit the Fund and its shareholders, and have approved the Plan by
votes cast in person at a meeting called for the purpose of voting on this Plan
and agreements related thereto.
7. The shareholder(s) of the Fund have approved the Plan.
<PAGE>
PLAN PROVISIONS
SECTION 1. EXPENDITURES
(a) Purposes. Fund assets may be utilized to pay for promotional services
related to the distribution of Fund shares, including personal services provided
to prospective and existing Fund shareholders, which include the costs of:
printing and distribution of prospectuses and promotional materials; making
slides and charts for presentations; assisting shareholders and prospective
investors in understanding and dealing with the Fund; and travel and
out-of-pocket expenses (e.g. copy and long distance telephone charges) related
thereto.
(b) Amounts. The Fund will pay to StockCar Stocks Advisors, LLC. (the
"Adviser") a monthly distribution fee at an annual rate of 0.25% of the Fund's
net assets attributable to No-Load Direct Class Shares, such fees to be computed
daily based on the daily average net assets of such Class Shares of the Fund.
The Adviser shall utilize such fees to pay for sales and promotional services
related to the distribution of Fund shares, including personal services provided
to prospective and existing Fund shareholders.
SECTION 2. TERM AND TERMINATION
(a) Initial Term. This Plan shall become effective on May 26, 1999 and
shall continue in effect for a period of one year thereafter unless terminated
or otherwise continued or discontinued as provided in this Plan.
(b) Continuation of the Plan. The Plan and any related agreements shall
continue in effect for periods of one year thereafter for so long as such
continuance is specifically approved at least annually by votes of a majority of
both (a) the directors of the Company and (b) the Qualified Directors, cast in
person at a meeting called for the purpose of voting on this Plan and such
related agreements.
(c) Termination of the Plan. This Plan may be terminated with respect to
the Fund, or any affected share class of the Fund, at any time by vote of a
majority of the Qualified Directors, or by vote of a majority of the outstanding
voting securities of the Fund.
SECTION 3. AMENDMENTS
This Plan may not be amended to increase materially the amount of
distribution expenditures provided for in Section 1 hereof unless such amendment
is approved by a vote of the majority of the outstanding voting securities of
the Fund, and no material amendment to the Plan shall be made unless approved in
the manner provided for annual renewal in Section 2(b) hereof.
SECTION 4. INDEPENDENT DIRECTORS
While this Plan is in effect with respect to the Fund, the selection and
nomination of Directors who are not interested persons of the Company (as
defined in the Act) shall be committed to the discretion of the Directors who
are not interested persons.
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SECTION 5. QUARTERLY REPORTS
The Treasurer of the Company and the Adviser shall provide to the
Directors, and the Directors shall review, at least quarterly, a written report
of the amounts accrued and the amounts expended under this Plan for
distribution, along with the purposes for which such expenditures were made.
SECTION 6. RECORDKEEPING
The Company shall preserve copies of this Plan and any related agreements
and all reports made pursuant to Section 5 hereof, for a period of not less than
six years from the date of this Plan, the agreements or such report, as the case
may be, the first two years in an easily accessible place.
SECTION 7. AGREEMENTS RELATED TO THIS PLAN
Agreements with persons providing distribution services to be paid for or
reimbursed under this Plan shall provide that:
(a) the agreement will continue in effect for a period of one year and will
continue thereafter only if specifically approved by vote of a majority of
the Directors of the Company;
(b) the agreement may be terminated at any time, without payment of any
penalty, by vote of a majority of (i) the Qualified Directors or (ii) the
outstanding voting securities of the Fund, on not more than sixty (60)
days' written notice to any other party to the agreement;
(c) the agreement will terminate automatically in the event of an
assignment; and
(d) in the event the agreement is terminated or otherwise discontinued, no
further payments will be made by the Fund after the effective date of such
action.
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<PAGE>
Thank you for mailing your ballot promptly!
We appreciate your continuing support and look forward to serving
your future investment needs.
STOCKCAR STOCKS MUTUAL FUNDS, INC.
SHAREHOLDER MEETING, MAY 26, 1999
BALLOT
1. Approve a new Rule 12b-1 Distribution Plan for No-Load Direct Shares of the
StockCar Stocks Index Fund.
Approve Reject Abstain
/ / / / / /
Signature(s) (All registered owners of accounts shown to the left must sign. If
signing for a corporation, estate or trust, please indicate your capacity or
title.)
X
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Signature Date
X
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Signature Date
PLEASE VOTE TODAY! PLEASE VOTE PROMPTLY! PLEASE VOTE TODAY!
Please vote using blue or black ink to mark an X in one of the three boxes
provided on your ballot. Mark - Approve, Reject, or Abstain. Then sign, date and
return your ballot in the accompanying postage-paid envelope. All registered
owners of an account, as shown in the address on the ballot, must sign the
ballot. If you are signing for a corporation, trust or estate, please indicate
your title or position. THIS PROXY IS SOLICITED BY THE BOARD OF STOCKCAR STOCKS
MUTUAL FUNDS, INC. WHICH RECOMMENDS A VOTE TO "APPROVE" ALL MATTERS.
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Your vote is needed!
Please vote on the reverse side of this form and sign in the space provided.
Return your completed proxy in the enclosed envelope today.
You may receive additional proxies for your other accounts with the Company.
These are not duplicates; you should sign and return each proxy card in order
for your votes to be counted. Please return them as soon as possible to help
save the cost of additional mailings.
The signers of this proxy hereby appoint Linda Coyne and Paul Giorgio, and each
of them, attorneys and proxies, with power of substitution in each, to vote all
shares for the signers at the special meeting of shareholders to be held May 26,
1999, and at any adjournments thereof, as specified herein, and in accordance
with their best judgement, on any other business that may properly come before
this meeting. If no specification is made herein, all shares will be voted to
"APPROVE" the proposal set forth on this proxy.
