As filed, via EDGAR, with the Securities and Exchange Commission
on July 30, 1996
File No.: 333-_____
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
|_| Pre-Effective Amendment No. __
|_| Post-Effective Amendment No. __
(check appropriate box or boxes)
-------------------
GINTEL FUND
(Exact Name of Registrant as Specified in Charter)
203 622-6400
(Area Code and Telephone Number)
6 Greenwich Office Park, Greenwich, Connecticut 06831
(Address of Principal Executive Office) (Zip Code)
---------------------
Stephen G. Stavrides
6 Greenwich Office Park
Greenwich, Connecticut 06831
(Name and address of agent for service)
Copy to:
SUSAN J. PENRY-WILLIAMS, ESQ.
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, New York 10022
-------------------
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.
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.
The Registrant has registered an indefinite number of securities under the
Securities Act of 1933 pursuant to Rule 24f-2 under the Investment Company Act
of 1940; accordingly, no fee is payable herewith. A Rule 24f-2 Notice for
Registrant's most recent fiscal year ended December 31, 1995 was filed with the
Commission on February 23, 1996.
<PAGE>
GINTEL FUND
CROSS REFERENCE SHEET
ITEMS REQUIRED BY FORM N-14
PART A
N-14
ITEM NO. ITEM CAPTION Prospectus Caption
- -------- ------------ ------------------
1. Beginning of Registration Statement and Cross Reference Sheet; Front
Outside Front Cover Page of Prospectus Cover Page.
2. Beginning and Outside Back Cover Page of
Prospectus Back Cover Page.
3. Fee Table, Synopsis Information and Risk Synopsis; Risk Factors;
Factors Comparison of Fees and
Expenses.
4. Information About the Transaction Reasons for the Transaction;
Synopsis; Information about
the Transaction.
5. Information About the Registrant Synopsis; Comparison of the
Funds' Investment Objectives
and Policies; Information
about the Funds; Additional
Information.
6. Information About the Company Synopsis; Comparison of the
Being Acquired Funds' Investment Objectives
and Policies; Information
about the Funds; Additional
Information.
7. Voting Information Voting Matters. Information Relating to
8. Interest of Certain Persons and Experts Inapplicable.
9. Additional Information Required for Inapplicable.
Reoffering by Persons Deemed to be
Underwriters
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<PAGE>
PART B
N-14 STATEMENT OF ADDITIONAL
ITEM NO. ITEM CAPTION INFORMATION CAPTION
- -------- ------------ -------------------
10. Cover Page Cover Page.
11. Table of Contents Cover Page.
12. Additional Information About the
Registrant Statement of Additional
Information of Gintel Fund
dated May 1, 1996.
13. Additional Information About the Company
Being Acquired Inapplicable.
14. Financial Statements Statement of Additional
Information of Gintel Fund,
which incorporates the audited
annual financial statements of
Gintel Fund, as of December
31, 1995 and the unaudited
financial statements and pro
forma combined financial
statements of Gintel ERISA
Fund and Gintel Fund, as of
June 30, 1996.
PART C
N-14
ITEM NO. ITEM CAPTION PART C CAPTION
- -------- ------------ --------------
15. Indemnification Indemnification.
16. Exhibits Exhibits.
17. Undertakings Undertakings.
- ii -
<PAGE>
GINTEL ERISA FUND
6 GREENWICH OFFICE PARK
GREENWICH, CONNECTICUT 06831
Fellow Shareholder:
We are holding a Special Meeting of Shareholders on _____________, 1996, to
seek your approval for the merger of Gintel ERISA Fund into Gintel Fund. On June
10, 1996, the Board of Trustees approved the proposed reorganization based upon
the recommendations of Gintel Equity Management, Inc., the Adviser to both
Funds.
After the proliferation of mutual funds over the last five years, we are seeing
a growing trend towards consolidation in the mutual fund industry. Many smaller
management companies, such as ours, are merging their funds in order to more
efficiently manage their portfolios, reduce fees for their shareholders through
economies of scale, and better focus their limited marketing resources.
The Board of Trustees and I believe the reorganization of ERISA Fund into Gintel
Fund benefits ERISA Fund shareholders because it lowers operating expenses,
provides a greater portfolio diversification, enables shareholders to track the
Gintel Fund's performance in the daily newspapers, and allows the investment
staff to focus on producing the best results for one single fund. In addition,
the Gintel Fund has had a superior investment record over the lifespan of the
Funds.
We wish to point out that the investment objectives of both Funds are quite
similar -- to achieve capital appreciation through investment in equities. Also,
the investment policies and philosophies employed to reach this objective are
essentially the same. The primary difference between these two Funds has been
that ERISA Fund only accepts tax-exempt investors, has been managed somewhat
more conservatively, and has more readily accepted short-term capital gains
without regard for tax consequences.
Our Board of Trustees has concluded that the proposal is in the best interests
of the Gintel ERISA Fund and its shareholders and recommends that you vote FOR
the proposal. In order for the proposal to be approved, the holders of a
majority of the outstanding securities of the Gintel ERISA Fund entitled to vote
at the meeting must vote for the proposal. Please take the time to consider this
important matter and vote now.
In order to make sure that your vote is represented, indicate your choices on
the enclosed proxy card, date and sign it and return it in the enclosed
envelope.
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<PAGE>
We look forward to seeing those of you who can attend the meeting and hope
you will all join me in voting our shares for this proposal.
Sincerely,
/s/Robert M. Gintel
-------------------
Robert M. Gintel
Chairman
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<PAGE>
GINTEL ERISA FUND
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
_______, 1996
A Special Meeting of Shareholders (the "Meeting") of the Gintel ERISA Fund
(the "Gintel ERISA Fund") will be held on ______, 1996 at 9:00 a.m. Eastern
time, at [ ] for the following purposes, which are more fully described in the
accompanying Prospectus/Proxy Statement dated _______, 1996:
1. To approve or disapprove an Agreement and Plan of Reorganization
providing for the transfer of the assets of the Gintel ERISA Fund to
the Gintel Fund in exchange for shares of the Gintel Fund and the
distribution of such shares to shareholders of the Gintel ERISA Fund
in liquidation of the Gintel ERISA Fund; and
2. To transact such other business as may properly come before the
Meeting or any adjournment or adjournments thereof.
The Board of Trustees of the Company fixed the close of business on ______,
1996 as the record date for determination of shareholders entitled to notice of,
and to vote at, the Meeting or any adjournment thereof. The enclosed proxy is
being solicited on behalf of the Board of Trustees of the Fund.
Each shareholder who does not expect to attend in person is requested to
complete, date, sign and return promptly the enclosed form of proxy.
By order of the Board of
Trustees,
Donna K. Grippe
Secretary
Dated: _______, 1996
YOUR VOTE IS IMPORTANT
Please indicate your voting instructions on the enclosed proxy card, sign and
date it, and return it in the envelope provided, which needs no postage if
mailed in the United States. In order to save any additional expense of further
solicitation, please mail your proxy promptly.
<PAGE>
GINTEL ERISA FUND
6 GREENWICH OFFICE PARK
GREENWICH, CONNECTICUT 06831
COMBINED PROSPECTUS/PROXY STATEMENT
_______, 1996
This Combined Prospectus/Proxy Statement is sent to you in connection with
the solicitation of proxies by the Board of Trustees (the "Board") of the Gintel
ERISA Fund for a Special Meeting of Shareholders (the "Meeting") to be held at
_______________________ on ____________ __, 1996, at 9:00 a.m., Eastern time, at
which shareholders of the Gintel ERISA Fund will be asked to consider and
approve a proposed Agreement and Plan of Reorganization dated as of ___________
__, 1996 (the "Plan").
The Plan provides for the transfer of the assets of the Gintel ERISA Fund
to the Gintel Fund, in exchange for shares of the Gintel Fund. Following such
transfer, shares of the Gintel Fund will be distributed to the existing
shareholders of the Gintel ERISA Fund. As a result of the proposed transactions,
each shareholder of the Gintel ERISA Fund will receive that number of full and
fractional shares of the Gintel Fund equal in value at the close of business on
the date of the exchange to the value of that shareholder's shares of the Gintel
ERISA Fund. These transactions are referred to as the "Reorganization." (The
Gintel Fund and the Gintel ERISA Fund are sometimes referred to as a "Fund" and
together as the "Funds").
Each Fund is an open-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), and each is
organized as a Massachusetts business trust. The investment objective of the
Gintel Fund is to achieve capital appreciation by investing in equities. The
primary investment objective of the Gintel ERISA Fund is to maximize total
investment returns through a combination of long-term appreciation and
investment income, and it also will invest for short-term capital gains, when,
in the Adviser's opinion, market conditions make such action appropriate.
The investment adviser to both Funds is Gintel Equity Management, Inc. (the
"Adviser").
This Prospectus/Proxy Statement, which you should keep for future
reference, sets forth concisely the information about the Gintel Fund that a
prospective investor should know before voting. THIS PROSPECTUS/PROXY STATEMENT
IS ACCOMPANIED BY THE PROSPECTUS OF THE GINTEL FUND DATED MAY 1, 1996, WHICH IS
INCORPORATED BY REFERENCE IN ITS ENTIRETY. A Statement of Additional Information
dated _______, 1996 relating to this Prospectus/Proxy Statement (the "Related
Statement of Additional Information") has been filed with the Securities and
Exchange
<PAGE>
Commission (the "Commission") and is incorporated by reference into this
Prospectus/Proxy Statement. A Statement of Additional Information dated May 1,
1996, containing additional information about the Gintel Fund has been filed
with the Commission and is incorporated into the Related Statement of Additional
Information. A copy of the Related Statement of Additional Information may be
obtained without charge by writing to the Funds at 6 Greenwich Office Park,
Greenwich, Connecticut 06831, or by calling the Funds at 203-622-6400.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS/PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
- --------------------------------------------------------------------------------
- 2 -
<PAGE>
SYNOPSIS
This Synopsis provides a concise summary of the information contained
in this Prospectus/Proxy Statement.
THE AGREEMENT AND PLAN OF REORGANIZATION You are being asked to approve
an Agreement and Plan of
Reorganization. Under the
Plan, the Gintel ERISA Fund
will transfer its assets to
the Gintel Fund in exchange
for shares of the Gintel Fund
and the assumption by the
Gintel Fund of the liabilities
of the Gintel ERISA Fund.
After the transaction, you
will receive that number of
shares of the Gintel Fund with
a total value equal to the net
asset value of your shares of
the Gintel ERISA Fund, as
determined at the close of
business on the date of the
exchange. You will not be
charged a sales charge for
this transaction. See "Reasons
for the Transaction" and
"Information About the
Transaction," and the copy of
the Plan, which is attached as
Exhibit A.
TAX CONSEQUENCES Each Fund will receive an
opinion of counsel to the
effect that no gain or loss
will be recognized by the
Gintel ERISA Fund, the Gintel
Fund, or the shareholders of
the Gintel ERISA Fund as a
result of the Reorganization.
See "Information about the
Transaction."
INVESTMENT OBJECTIVES AND POLICIES Gintel Fund. The investment
objective of the Gintel Fund
is to achieve capital
appreciation by investing in
equities. Toward this end, the
Gintel Fund invests in common
stocks or securities
convertible into common stock.
Gintel ERISA Fund. The primary
investment objective of
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<PAGE>
the Gintel ERISA Fund is to
maximize total investment
return through a combination
of long-term appreciation and
investment income, and it will
also invest for short-term
capital gains, when, in the
Advisers's opinion, market
conditions make such action
appropriate. Toward this end,
the Gintel ERISA Fund invests
in common stocks or securities
convertible into common stock,
as well as fixed income
securities or debt
instruments.
Each Fund has additional
investment policies which are
similar and which are
discussed under "Comparison of
the Funds' Investment
Objectives and Policies,"
below.
MANAGEMENT OF THE FUNDS
Investment Adviser Gintel Equity Management, Inc.
(the "Adviser") is the
investment adviser for each
Fund. See "Information About
the Funds."
Administrator Gintel & Co. Limited
Partnership is the administra-
tor for each Fund. See
"Information About the Funds."
Fees and Expenses The investment advisory and
administrative services fees
are identical for each Fund.
Because the administrative
services fees are at
breakpoints based on assets,
it is anticipated that
due to a larger asset base
shareholders will be subject
to lower overall levels of
administrative services fees
and total fund expenses for
the foreseeable future as a
result of the Reorganization.
See "Comparison of Fees and
Expenses."
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<PAGE>
TRUSTEES AND OFFICERS The Trustees and officers are
identical for each Fund and
will remain the same after the
Reorganization.
DISTRIBUTION AND PURCHASE The procedures for purchasing
PROCEDURES; EXCHANGE RIGHTS; and redeeming shares are
REDEMPTION PROCEDURES materially the same for each
Fund, and each Fund has
materially similar exchange
privileges.
OTHER CONSIDERATIONS In the event the shareholders
of the Gintel ERISA Fund do
not approve the
Reorganization, the Fund will
continue its current
operations. Shareholders have
no right of appraisal, but may
continue to redeem their
shares in accordance with
normal Fund policies.
This Synopsis is qualified by reference to the more complete information
contained elsewhere in this Prospectus/Proxy Statement, including information
incorporated herein from the attached Prospectus for the Gintel Fund dated May
1, 1996 (the "Prospectus"), and in the Agreement and Plan of Reorganization
attached to this Prospectus/Proxy Statement as Exhibit A.
RISK FACTORS
In general, the investment policies and risk factors of the Gintel Fund and
the Gintel ERISA Fund are substantially identical. As described more fully below
under "Comparison of the Funds' Investment Objectives and Policies," the
principal risk factors of investing in the Gintel Fund in comparison to those of
the Gintel ERISA Fund are as follows:(1) the Gintel Fund may invest in non-U.S.
securities while the Gintel ERISA Fund may not;(2) each Fund may lend its
portfolios securities to brokers, dealers and other institutional investors
(although the Gintel Fund may not do so in an amount in excess of 10% of its
total assets); (3) each Fund, subject to certain restrictions, may invest in
other investment companies; (4) each Fund will not make short sales of
securities or maintain short positions unless at all times when a short position
is open the Fund owns an equal amount of such securities or securities
convertible into or exchangeable, without payment of any further consideration,
for securities of the same issues as, and equal in an amount to, the securities
sold short; (5) the Gintel Fund may invest in all types of debt securities, in
any proportion and may invest in investment-grade corporate debt securities
which are considered
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<PAGE>
to be those rated Baa-3 or higher by Moody's Investors Service, Inc. or BBB- or
higher by Standard & Poor's Corporation. Securities rated Baa-3 and BBB- are
considered to have speculative characteristics. The Gintel ERISA Fund may invest
in fixed income securities or debt instruments; (6) the Gintel Fund will not
invest in securities judged by the Adviser to be of poor quality, although it
may invest in unrated securities if the Adviser determines that such securities
present attractive investment opportunities and are of comparable quality to the
other debt securities in which the Gintel Fund may invest; (7) the Gintel Fund
may, from time to time, borrow money to the maximum extent permitted by the
Investment Company Act from banks at prevailing interest rates and invest the
funds in additional securities (which it has done infrequently and only for
short periods over the lifespan of the Fund) while the Gintel ERISA Fund may not
borrow money, except it may borrow up to 5% of the value of its total assets at
the time of such borrowing from banks for temporary or emergency purposes (which
it has never done); and (8) each Fund has adopted the following restrictions
which may not be changed without shareholder approval:(i)with respect to 50% of
its assets, it will not at the time of purchase invest more than 5% of its total
assets, at market value, in the securities of any one issuer (except the
securities of the United States Government); and (ii) with respect to the other
50% of its assets, it will not invest at the time of purchase more than 25%
(15%, with respect to the Gintel ERISA Fund) of the market value of its total
assets in any single issuer. These two restrictions, hypothetically, could give
rise to a portfolio with as few as twelve (fourteen, with respect to the Gintel
ERISA Fund) issuers.
COMPARISON OF FEES AND EXPENSES
The following tables summarize and compare the fees and expenses of the
Funds. These tables are intended to assist shareholders in comparing the various
costs and expenses that shareholders indirectly bear with respect to an
investment in the Gintel ERISA Fund and those that they can expect to bear
indirectly as shareholders of the Gintel Fund. Actual expenses may be more or
less than those set forth below. In addition, the "Example" set forth below
should not be considered a representation of future expenses, which will vary
depending upon actual investment returns and expenses.
Shareholder Transaction Expenses
Maximum Sales
Deferred Charge on
Maximum Sales Sales Load Reinvested Redemption
Load on Redemptions Dividend Fees
- -------------------------------------------------------------------------------
Gintel Fund None None None None
Gintel ERISA Fund None None None None
===============================================================================
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<PAGE>
Annual Fund Operating Expenses
(as a percentage of average daily net assets)
Total
Management Other Operating
Fee 12b-1 Fees Expenses* Expenses*
- -------------------------------------------------------------------------------
Gintel Fund 0.99% --- 1.26% 2.25%
Gintel ERISA Fund 1.04% --- 1.41% 2.45%
Pro Forma for
Combined Funds .96% --- 1.15% 2.11%
(6-30-96)
* Includes brokerage commissions, which are paid under the Fund's
Administrative Services Agreement. Although the maximum advisory fee is 1%
and the maximum administrative services fee is 1 1/4% of the first $50
million, 1 1/8% of the next $50 million, and 1% on assets over $100
million, timing differences between the way the expense ratio is calculated
(daily, based on net assets for the fiscal year) and the manner in which
the fees are paid (quarterly, based on the previous three months average
daily net assets) may cause the operating expense ratio to exceed or fall
below these fee rates, but in no case is either Fund actually charged more
or less than the prescribed fees.
Example
Using the above expenses, you would pay the following expenses on a $1,000
investment, assuming a 5% annual return and redemption at the end of each of the
periods shown:
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Gintel Fund $23 $70 $121 $259
Gintel ERISA Fund 25 76 131 279
Pro Forma for
Combined Funds 21 66 113 244
This example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.
INFORMATION ABOUT THE TRANSACTION
AGREEMENT AND PLAN OF REORGANIZATION. The Plan provides that at 9 a.m. on
the Closing Date (as defined below) for the Reorganization, all of the assets of
the Gintel ERISA Fund will be transferred to the Gintel Fund.
In exchange for the transfer of the assets of the Gintel ERISA Fund, the
Gintel Fund will assume the liabilities of the
- 7 -
<PAGE>
Gintel ERISA Fund and will issue to the Gintel ERISA Fund full and fractional
shares of the Gintel Fund. The Gintel ERISA Fund will distribute the shares so
received to the Shareholders of the Gintel ERISA Fund, whose shares in the
Gintel ERISA Fund will become void. Shareholders of the Gintel ERISA Fund at the
time of the Reorganization will become shareholders of the Gintel Fund and will
receive the same dollar amount in Gintel Fund shares as the Shareholder had held
in the Gintel ERISA Fund.
The share transfer books of the Gintel ERISA Fund will be permanently
closed as of the close of business on the business day immediately preceding the
Closing Date of the Reorganization. Redemption requests received thereafter by
the Gintel ERISA Fund will be deemed to be redemption requests relating to
shares of the Gintel Fund.
The current fundamental policies (changeable only by shareholder vote) of
the Gintel ERISA Fund, including any limitations set forth in the By-laws of the
Gintel ERISA Fund, could be deemed to prevent it from taking the actions
necessary to effectuate the Reorganization as described in this Combined
Prospectus/Proxy Statement. In general, these policies may prohibit the Gintel
ERISA Fund from purchasing more than a stated percentage of another company
(which may be deemed to include the Gintel Fund, in connection with its
Reorganization). By approving the Plan, Shareholders will be deemed to have
agreed to waive the application of any such fundamental policies to the extent
necessary to consummate its Reorganization.
The Reorganization is subject to a number of other conditions, including
the receipt of certain legal opinions described in the Plan, the continued
accuracy of the representations and warranties in the Plan, certain regulatory
approvals and the parties' performance in all material respects of their
respective agreements and undertakings in the Plan. Assuming satisfaction of the
conditions in the Plan, the closing date for the Reorganizations will be on
__________ __, 1996, or such other date as is agreed to by the parties (the
"Closing Date").
The Plan provides that the Board of the Gintel ERISA Fund may terminate the
Plan and abandon the Reorganization at any time prior to the Reorganization,
notwithstanding approval thereof by Shareholders, if, in the judgment of the
Board, proceeding with the Reorganization would be inadvisable. The Board of
Trustees of the Gintel Fund may terminate the Plan and abandon the
Reorganization contemplated thereby if any of the conditions set forth in the
Plan have not been satisfied. In the event of any such termination, there will
be no liability for damages on the part of either party to the other.
The Gintel Fund and The Gintel ERISA Fund will pay the ordinary and
reasonable costs and expenses of the Reorganization
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<PAGE>
and all transactions contemplated by the Plan, prorated according to the
relative asset size.
DESCRIPTION OF SHARES OF THE GINTEL FUND. Full and fractional shares of the
Gintel Fund will be issued to the shareholders of the Gintel ERISA Fund in
accordance with the procedures under the Plan as described above. Each share
will be fully paid and nonassessable when issued and transferrable without
restriction and will have no preemptive or conversion rights.
EXPENSES. The Reorganization will be effected for each Gintel ERISA Fund
shareholder at net asset value without the imposition of any sales charges. No
certificates for the Gintel Fund shares will be issued unless requested in
writing.
SHAREHOLDER APPROVAL. Approval of the Plan requires the affirmative vote of
a majority of the votes entitled to be cast of the Gintel ERISA Fund.
The Board may terminate the Plan at any time prior to the closing of the
transaction.
REASONS FOR THE TRANSACTION
The Board considered the Reorganization at a meeting on June 10, 1996. At
the meeting, the Adviser recommended to the Trustees that they approve, and
recommend to the shareholders of the Gintel ERISA Fund for their approval, a
Reorganization of the Gintel ERISA Fund into the Gintel Fund, in accordance with
the terms of the Plan.
In accepting the Adviser's recommendation, the Board considered the fact
that the Adviser is the investment adviser to both Funds. In addition, the Board
considered the similarities of the investment objective and policies of the
Funds and the fact that the Funds share the same service providers. The Board
also considered that the investment record of the Gintel Fund has been superior
to that of the Gintel ERISA Fund over a significant period of time.
Given the above factors and the similarity in the investment strategies of
the Gintel ERISA Fund and the Gintel Fund, the Board concluded that combining
the two Funds would be appropriate and would enable the shareholders of the
combined portfolio to benefit from certain economies of scale, including a lower
expense ratio than that currently experienced by the Gintel ERISA Fund, while
also affording shareholders the continuing opportunity to participate in a
portfolio of equity securities. In addition, the Board concluded that the
Reorganization benefits the Gintel ERISA Fund shareholders because a combined
fund will provide greater portfolio diversification, will enable shareholders to
track the Gintel Fund's performance in the daily newspapers, and will allow the
investment staff to focus on
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<PAGE>
producing the best results for one combined fund. The Board also agrees with the
Adviser that by combining the Funds, the Adviser will be able to concentrate its
marketing resources on a single equity fund to attract investors interested in
such a fund.
The Adviser indicated to the Board its belief that the most appropriate
method of combining the Gintel ERISA Fund into the Gintel Fund would be through
an acquisition of the assets of the Gintel ERISA Fund by the Gintel Fund.
In reaching its decision to recommend shareholder approval of the
Reorganization, the Board made inquiries into a number of factors. The Board was
informed of the expense ratios of the Funds as described above.
The Board also considered the following comparative investment performance
information regarding the Funds:
Total Return Information
------------------------
From January 18, 1992
One Year Period (inception of Gintel ERISA
ended December 31, 1995 Fund) to December 31, 1995
----------------------- ---------------------------
Gintel Fund 30.97% 479.89%
Gintel ERISA Fund 26.62% 356.97%
The factors considered by the Board included, among other things: (1)
recent and anticipated asset and expense levels of the Funds and future
prospects of each Fund; (2) the similarity of the investment advisory,
distribution and administration arrangements, the fact that the Funds have the
same custodian, transfer agent, dividend paying agent and independent
accountants (the "Service Providers"); (3) that combining the assets of the two
Funds is expected to result in lower administrative services fees because the
breakpoints, which are based on asset size, will be applied to a larger asset
base; (4) the terms and conditions of the Reorganization; and (5) the similarity
of the investment objectives, policies and restrictions of the two Funds.
Based upon these factors, the Trustees unanimously determined that the
transaction would not result in dilution of the interests of, and would be in
the best interest of, the shareholders of each of the Funds and recommended that
the shareholders of the Gintel ERISA Fund approve the Reorganization and the
Plan. The Trustees present at the June 10, 1996 Board Meeting constituted a
majority of all of the Trustees and a majority of those Trustees who are not
"interested persons" of the Adviser or the Funds, within the meaning of the 1940
Act (the "Independent Trustees").
- 10 -
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
Consummation of the Reorganization is subject to the condition that the
Gintel ERISA Fund and the Gintel Fund receive an opinion from counsel to the
Gintel Fund stating that for federal income tax purposes: (i) the exchange by
the Gintel ERISA Fund of substantially all its assets in exchange for shares of
the Gintel Fund and the assumption by the Gintel Fund of the liabilities of the
Gintel ERISA Fund pursuant to the Plan will constitute a reorganization within
the meaning of section 368(a)(1)(C) or 368(a)(1)(D) of the Code, respectively,
depending upon whether shareholders of the Gintel ERISA Fund receive in the
aggregate less than fifty percent, or fifty percent or more, of the shares of
the Gintel Fund; (ii) the Gintel ERISA Fund will not recognize any gain or loss
as a result of the Reorganization; (iii) the Gintel Fund will not recognize any
gain or loss as a result of the Reorganization; (iv) Shareholders of the Gintel
ERISA Fund will not recognize any gain or loss on the exchange of their the
Gintel ERISA Fund shares for the Gintel Fund shares in the Reorganization; (v)
the basis of the Gintel Fund shares received by a Shareholder will equal the
basis of the Shareholder's Gintel ERISA Fund shares immediately prior to the
Reorganization; (vi) the holding period of the Gintel Fund shares received in
the Reorganization by a Shareholder will include the holding period during which
he held the Gintel ERISA Fund shares exchanged therefor as a capital asset as of
the time of the Reorganization; and (vii) the bases and holding periods of the
Gintel Fund in the assets of the Gintel ERISA Fund received in the
Reorganization will equal the bases and will include the holding periods,
respectively, of such assets in the hands of the Gintel ERISA Fund immediately
prior to the Reorganization.
The Gintel ERISA Fund and the Gintel Fund have not sought a tax ruling from
the Internal Revenue Service ("IRS") with respect to the tax aspects of the
Reorganization, but will act in reliance upon the opinion of counsel discussed
in the preceding paragraph. Such opinion is not binding on the IRS and does not
preclude the IRS from adopting a contrary position. If for any reason the
Reorganization of the Gintel ERISA Fund did not qualify as a tax-free
reorganization for federal income tax purposes, then (i) the transfer of the
Gintel ERISA Fund's assets to the Gintel Fund would be treated as a taxable sale
or exchange of those assets at fair market value, and (ii) the exchange -- by
the shareholders of the Gintel ERISA Fund -- of their Gintel ERISA Fund shares
for the Gintel Fund shares would be treated as a taxable exchange of the Gintel
ERISA Fund shares, also at fair market value. Shareholders should consult their
own advisers concerning that and other potential tax consequences of the
Reorganization to them, including any applicable state and local income tax
consequences.
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<PAGE>
CAPITALIZATION. The following table shows the capitalization of the Gintel
ERISA Fund and the Gintel Fund as of June 30, 1996, and on a pro forma basis as
of that date giving effect to the proposed acquisition of assets at net asset
value:
Gintel ERISA Gintel Pro Forma
Fund Fund Combined
---- ---- --------
Net assets $ 28,922,915 $109,772,129 $138,695,044
(As of 6/30/96)
NAV per share: $ 31.98 $ 17.94 $ 17.94
Shares
outstanding: 904,500 6,118,707 7,730,910
COMPARISON OF THE FUNDS' INVESTMENT OBJECTIVES AND POLICIES
GENERAL. The investment objectives and policies of the Funds are similar.
Both seek appreciation by investing in a non-diversified portfolio of common
stocks. Each Fund invests in major corporations whose shares are listed on the
New York Stock Exchange or the American Stock Exchange. Each Fund may also
invest in securities traded in the Over-the-Counter market (with respect to the
Gintel ERISA Fund, such securities must, in the opinion of the Adviser, be
non-speculative, and such investments may not exceed 25% of its total assets at
time of purchase). Although each Fund has flexibility to invest in a broad range
of corporations, neither will purchase the securities of any corporation with a
record of less than three years' continuous operations, including that of
predecessors. Each Fund may lend its portfolio securities to brokers, dealers
and other institutional investors (with respect to the Gintel Fund, in an amount
not to exceed 10% of its total assets). Each Fund, subject to certain
restrictions, may invest in other investment companies. Neither Fund will make
short sales of securities or maintain short positions unless at all times when a
short position is open the Fund owns an equal amount of such securities or
securities convertible into or exchangeable, without payment of any further
consideration, for securities of the same issue as, and equal in an amount to
the securities sold short. This is a technique known as selling short "against
the box."
The Gintel Fund may, from time to time, borrow money to the maximum extent
permitted by the Investment Company Act from banks at prevailing interest rates
and invest the funds in additional securities. Since inception in 1981, the
Gintel Fund has borrowed approximately eight times for relatively short periods.
The Gintel Fund's borrowings are limited so that immediately after such
borrowings the value of assets (including borrowings) less liabilities (not
including borrowings) is at least three times the amount of the borrowings.
Should the Gintel Fund, for any reason, have borrowings that do not meet the
above test then, within three business days, the Fund must reduce such
borrowings so as to meet the necessary test. Under such a circumstance, the
Gintel Fund may have to liquidate fund securities at a time when it is
disadvantageous to do so. Gains made with additional funds borrowed will
generally cause the net asset value of the Gintel Fund's shares to rise faster
than could be the case without borrowings. Conversely, if investment results
fail to cover the cost of borrowings, the net asset value of the Fund could
decrease faster than if there had been no borrowings. The Gintel ERISA Fund may
not borrow money, except it may borrow up to 5% of the value of its total assets
at the time of such borrowing from banks for temporary or emergency purposes;
however, at no time has the Gintel ERISA Fund ever borrowed for any purpose.
GINTEL ERISA FUND. The primary investment objective of the Gintel ERISA
Fund is to maximize total investment return through a combination of long-term
appreciation and investment income, and it also will invest for short-term
capital gains, when, in the Adviser's opinion, market conditions make such
action appropriate. Toward this end, the Fund invests in common stocks
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or securities convertible into common stock, as well as fixed income securities
or debt instruments.
GINTEL FUND. The investment objective of the Gintel Fund is to achieve
capital appreciation by investing in equities. Toward this end, the Fund invests
in common stocks or securities convertible into common stock. Current income is
not the Fund's investment objective; however, when, in the Adviser's opinion,
market conditions warrant a temporary defensive position, there is no
restriction on the Fund's investment in debt instruments, including tax-exempt
bonds. Similarly, there may be occasions when the Fund will have a portion of
its portfolio invested in cash or cash equivalents.
The Gintel Fund may invest in all types of debt securities, in any
proportion, including debt obligations of the U.S. Treasury, its agencies and
instrumentalities, bonds, notes, mortgage securities, government and government
agency obligations, zero coupon securities, convertible securities, and
repurchase agreements. The Fund may invest in investment-grade corporate debt
securities which are considered to be those rated Baa-3 or higher by Moody's
Investor Service, Inc. or BBB- or higher by Standard & Poor's Corporation.
Securities rated Baa-3 and BBB- are considered to have speculative
characteristics. The Fund will not invest in securities judged by the Adviser to
be of poor quality, although it may invest in unrated securities if the Adviser
determines that such securities present attractive investment opportunities and
are of comparable quality to the other debt securities in which the Fund may
invest.
Up to 20% of the Gintel Fund's total assets may be invested in non-U.S.
securities however, since inception, the Gintel Fund has only invested in
non-U.S. securities on an infrequent basis. There are certain risks involved in
investing in non-U.S. securities, including those resulting from fluctuations in
currency exchange rates, reevaluation of currencies, future political and
economic developments and the possible imposition of currency exchange
regulations or other foreign governmental laws or restrictions, reduced
availability of public information concerning issuers, and the fact that
non-U.S. companies are not generally subject to uniform accounting, auditing and
financial reporting standards or to other regulatory practices and requirements
comparable to those applicable to domestic companies. Moreover, securities of
many non-U.S. companies may be less liquid and their prices more volatile than
those of securities of comparable domestic companies. In addition, with respect
to certain foreign countries, there is the possibility of expropriation,
confiscatory taxation and limitations on the use or removal of funds or other
assets of the Fund.
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<PAGE>
INFORMATION ABOUT THE FUNDS
INVESTMENT ADVISORY AGREEMENTS. The investment advisory agreement between
the Gintel Fund and the Adviser (the "Investment Advisory Agreement") contains
terms that are the same as those set forth in the current investment advisory
agreement between the Gintel ERISA Fund and the Adviser.
The Adviser, a Connecticut corporation with its principal offices at 6
Greenwich Office Park, Greenwich, Connecticut 06831, is registered with the
Commission as an investment adviser and, in addition to managing the Funds, has
been managing discretionary investment accounts for individual investors,
corporate pension funds and profit sharing plans, charitable foundations,
universities and others since 1971.
The Investment Advisory Agreement provides that the Adviser identify and
analyze possible investments for the Fund and determine the amount, timing, and
form of such investments. The Adviser has the responsibility of monitoring and
reviewing the Fund's portfolio, on a regular basis, and recommending the
ultimate disposition of such investments. It is the Adviser's responsibility to
cause the purchase and sale of securities in the Fund's portfolio, subject at
all times to the policies set forth by the Board of Trustees.
ADVISORY AND DISTRIBUTION FEES. Under the current investment advisory
agreements of the Gintel ERISA Fund and the Gintel Fund, each Fund pays the
Adviser advisory fees at the rate of 1.00% average daily net assets.
ADMINISTRATOR. Gintel & Co. Limited Partnership acts as administrator for
both Funds(the "Administrator"). For each
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Fund, the Administrator is paid a maximum administration fee of 1.25% on the
first $50 million in average daily net assets; 1.125% on the next $50 million;
and 1.0% over $100 million.
EXPENSE RATIOS. As of December 31, 1995 the Gintel ERISA Fund had total net
assets of approximately $27,766,076 and the Gintel Fund had total net assets of
approximately $96,738,857. As of December 31, 1995, the total expense ratios for
the Gintel ERISA Fund and Gintel Fund were 2.45% and 2.25%, respectively. See
"Comparison of Fees and Expenses," below. The maximum administrative services
fee, payable at the beginning of each quarter based on average daily net assets
during the preceding quarter, is 1.25% of the first $50 million of the average
daily net assets of each Fund, 1.125% of the next $50 million of the average
daily net assets of each Fund and 1.0% of the average daily net assets in excess
of $100 million. The operating expense ratio for each Fund, which is calculated
on the basis of average assets during the fiscal year, may be higher or lower
than these figures due to timing differences caused by payment of these
administrative services fees on a trailing-quarter rather than fiscal-year
basis. After the Reorganization, it is expected that total operating expenses of
the combined Gintel Fund will be approximately 2.17%. (Please note that each
Fund's expense ratio includes brokerage commissions on portfolio transactions
paid for under a Fund's administrative services fee, and, therefore, may appear
higher than those of other mutual funds as well as for the Fund in prior years.
Other mutual funds do not include brokerage commissions in their operating
expense, but instead add then to the cost of securities purchased or deduct from
them from the proceeds of securities sold.)
DIVIDENDS AND DISTRIBUTIONS. It is each Fund's policy to distribute to
shareholders all of its investment income (net of expenses) and any capital
gains (net of capital losses) in accordance with the timing requirements imposed
by the Internal Revenue Code of 1986. Distributions to shareholders will be
treated in the same manner for Federal income tax purposes whether received in
cash or reinvested in additional shares of a Fund.
PURCHASE PROCEDURES AND EXCHANGE PRIVILEGES/CONTINGENT DEFERRED SALES
CHARGE. The Funds have identical purchase procedures (except for the minimum
initial investment required) and exchange privileges. Shares of both Funds are
sold on a continuous basis at net asset value.
REDEMPTION PROCEDURES. The Funds offer identical redemption features
pursuant to which proceeds of a redemption are remitted to shareholders.
GENERAL. Each Fund is a Massachusetts business trust and has identical
rights under its Agreement and Declaration of Trust and applicable Massachusetts
law. Each share of a Fund is entitled to one vote for all purposes.
Massachusetts law does
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<PAGE>
not require registered investment companies, such as the Funds, to hold annual
meetings of shareholders and it is anticipated that shareholder meetings will be
held only when specifically required by federal or state law. Shareholders have
available certain procedures for the removal of Trustees. Each Fund indemnifies
trustees and officers to the fullest extent permitted under Massachusetts law.
ADDITIONAL INFORMATION
This Prospectus/Proxy Statement and the Related Statement of Additional
Information do not contain all of the information set forth in the registration
statement and the exhibits relating thereto filed by the Fund with the
Commission under the Securities Act of 1933 and the 1940 Act, to which reference
is hereby made.
Information about the Gintel Fund is included in the Prospectus dated May
1, 1996, a copy of which is included herewith and incorporated by reference
herein. Additional information is included in the Statement of Additional
Information dated May 1, 1996, which has been filed as part of the Related
Statement of Additional Information of this Combined Proxy Statement and
Prospectus, dated _______, 1996 and is incorporated herein by reference.
Both Funds file proxy material, reports and other information with the
Commission. These documents and other information can be inspected and copied at
the Public Reference Facilities maintained by the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. Copies of such material can also be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, Securities and Exchange Commission, Washington, D.C. 20549
at prescribed rates.
INFORMATION RELATING TO VOTING MATTERS
GENERAL INFORMATION
This Prospectus/Proxy Statement is being furnished in connection with the
solicitation of proxies by the Board for the Meeting. It is expected that the
solicitation of proxies will be primarily by mail. Representatives of the
Adviser and the Fund and service contractors retained by the Fund, may contact
shareholders directly to discuss the proposals set forth herein, and may also
solicit proxies by telephone, telegraph or personal interview. The Gintel Fund
and the Gintel ERISA Fund will bear the cost of solicitation of proxies. It is
anticipated that banks, broker-dealers and other institutions will be requested
to forward proxy materials to beneficial owners and to obtain authorization for
the execution of proxies. The Gintel Fund and the Gintel ERISA Fund may, upon
request, reimburse banks, broker-
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<PAGE>
dealers and other institutions for their expenses in forwarding proxy materials
to beneficial owners.
Only shareholders of record of the Gintel ERISA Fund at the close of
business on _____ __, 1996 (the "Record Date"), will be entitled to vote at the
Meeting. As of the Record Date, there were __________ shares of the Gintel ERISA
Fund issued and outstanding. As of ______ __, 1996, the following persons owned
of record or beneficially 5% or more of the outstanding shares of either class
of shares of the Gintel ERISA Fund: [ ]
If the accompanying proxy is executed and returned in time for the Meeting,
the shares covered thereby will be voted in accordance with the instructions
thereon. In the absence of any instructions, such proxy will be voted to approve
the Reorganization. Any shareholder giving a proxy may revoke it at any time
before the Meeting by submitting to the Fund a written notice of revocation or a
subsequently executed proxy, or by attending the Meeting and voting in person.
If a proxy represents a broker "non-vote" (that is, a proxy from a broker
or nominee indicating that such person has not received instructions from the
beneficial owner or other person entitled to vote shares on a particular matter
with respect to which the broker or nominee does have discretionary power) or
marked with an abstention (collectively, "abstentions"), the shares represented
thereby will be considered to be present at the meeting for purposes of
determining the existence of a quorum for the transaction of business.
QUORUM AND ADJOURNMENTS
A quorum is constituted by the presence in person or by proxy of the
holders of a majority of the total number of shares outstanding and entitled to
vote, with respect to the Gintel ERISA Fund. If a quorum is not present at the
Meeting, or if a quorum is present but sufficient votes to approve the
Reorganization are not received, the persons named as proxies may propose one or
more adjournments of the Meeting to permit further solicitation of proxies (but
not more than 120 days after the original record date). In determining whether
to adjourn the Meeting, the following factors may be considered: the nature of
the proposals that are the subject of the Meeting, the percentage of votes
actually cast, the percentage of negative votes actually cast, the nature of any
further solicitation and the information to be provided to shareholders with
respect to the reasons for the solicitation. Any adjournment will require the
affirmative vote of a majority of those shares represented at the Meeting in
person or by proxy. The persons named as proxies will vote for or against an
adjournment based on their determination of what is in the best interests of the
shareholders, taking into consideration the factors discussed above. A
shareholder vote may be taken prior to any adjournment if sufficient votes have
been received for approval.
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<PAGE>
APPRAISAL RIGHTS
The Agreement and Declaration of Trust of the Gintel ERISA Fund does not
grant shareholders any rights of share appraisal. Shareholders have the right to
redeem their shares of the Gintel ERISA Fund at net asset value at any time
until the close of business on the business day prior to the Closing Date of the
Reorganization and, thereafter, shareholders may redeem from the Gintel Fund the
Gintel Fund shares acquired by them in the Reorganization.
OTHER BUSINESS
The Board of Trustees of the Gintel ERISA Fund knows of no other business
to be brought before the Meeting. However, if any other matters come before the
Meeting, proxies that do not contain specific restrictions to the contrary will
be voted on such matters in accordance with the judgment of the persons named as
Proxies.
FUTURE SHAREHOLDER PROPOSALS
Pursuant to rules adopted by the Commission under the Securities Exchange
Act of 1934, as amended (the "1934 Act"), Shareholders may request inclusion in
the Fund's proxy statement for an annual meeting of shareholders proposals that
they intend to introduce at such meeting. Any such proposals must be presented a
reasonable time before the proxy materials for the next meeting are sent to
shareholders. The submission of a proposal does not guarantee its inclusion in
the proxy statement and is subject to limitations under the 1934 Act. The Fund
does not hold annual meetings of shareholders. For this reason, no anticipated
date of the next meeting, if any, can be provided.
THE BOARD OF TRUSTEES, INCLUDING A MAJORITY OF THE INDEPENDENT TRUSTEES, OF
GINTEL ERISA FUND RECOMMEND APPROVAL OF THE PLAN.
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<PAGE>
MISCELLANEOUS
FINANCIAL STATEMENTS.
The financial statements of the Funds incorporated by reference in the
Related Statement of Additional Information relating to this Prospectus/Proxy
Statement have been audited by Richard A. Eisner & Company, LLP, independent
accountants, for the periods indicated in their report thereon, which is
included in the annual report to shareholders for the year ended December 31,
1995.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS COMBINED PROSPECTUS/PROXY
STATEMENT AND IN THE MATERIALS EXPRESSLY INCORPORATED HEREIN BY REFERENCE AND,
IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY GINTEL FUND OR THE ADVISER. THIS
PROSPECTUS/PROXY STATEMENT DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION
IN WHICH SUCH AN OFFERING MAY NOT LAWFULLY BE MADE.
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<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
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<PAGE>
FORM OF
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Plan") is made this ___ day of
_______, 1996, by and among the Gintel ERISA Fund (the "ERISA Fund") and the
Gintel Fund (the "Gintel Fund"), each a Massachusetts business trust.
W I T N E S S E T H :
WHEREAS, the ERISA Fund is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, this Plan is intended to be and is adopted as a plan of reorganization
within the meaning of Section 368(a)(1)(C) of the Internal Revenue Code of 1986,
as amended, such reorganization to consist of the transfer of all of the assets
of the ERISA Fund in exchange for shares of beneficial interest, no par value,
of the Gintel Fund ("New Shares"), the assumption by the Gintel Fund of the
liabilities of the ERISA Fund, and the distribution, after the Closing (as
defined in Section (5) of New Shares to the shareholders of the ERISA Fund, all
upon the terms and conditions hereinafter set forth in this Plan; and
WHEREAS, the Board of Trustees of the ERISA Fund, including a majority of the
Trustees who are not interested persons of the ERISA Fund, within the meaning of
the 1940 Act, has determined with regard to the ERISA Fund that participating in
the transactions contemplated by this Plan is in the best interests of the ERISA
Fund and that the interests of shareholders of the ERISA Fund will not be
diluted as a result of such transactions.
NOW, THEREFORE, the Board of Trustees of the ERISA Fund hereby adopts and
declares the following Plan:
1. TRANSFER OF ASSETS.
Subject to the terms and conditions set forth herein, at the Closing the
ERISA Fund shall transfer all of the assets of the ERISA Fund to the Gintel
Fund, and in consideration therefor, the Gintel Fund shall assume all of the
Liabilities (as defined herein), and issue to the ERISA Fund, on behalf of the
ERISA Fund, New Shares having an aggregate net asset value equal to the value of
the assets of the ERISA Fund transferred less the Liabilities assumed.
"Liabilities" shall mean the liabilities and obligations reflected in an
unaudited statement of assets and liabilities of the ERISA Fund as of the close
of business on the Valuation Date (as hereinafter defined), determined in
accordance with generally accepted accounting principles consistently applied
from the ERISA Fund's most recently completed audit period. The net asset value
of the New Shares and the value of the net assets of the ERISA Fund to be
transferred shall be
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<PAGE>
determined as of the close of regular trading on the New York Stock Exchange on
the business day next preceding the Closing (the "Valuation Date") using the
valuation procedures set forth in the then current prospectus and statement of
additional information of the Gintel Fund.
2. ISSUANCE OF THE NEW SHARES.
Upon the consummation of the transactions referred to in Section 1, the New
Shares will be issued to the ERISA Fund, to be credited to the accounts of
shareholders of record of the ERISA Fund at the close of business on the
Valuation Date. At or as soon as practicable after the Closing, the New Shares
will be distributed to such shareholders in exchange for and in liquidation and
cancellation of the shares of the ERISA Fund, each such shareholder to receive
the number of New Shares that is equal in dollar amount to the value of shares
of beneficial interest of the ERISA Fund held by such shareholder as of the
close of business on the Valuation Date. Such distribution will be accomplished
by the establishment of an open account on the share records of the Gintel Fund
in the name of each shareholder of the ERISA Fund and representing the
respective number of New Shares due such shareholder. For these purposes, the
shareholders of record of the ERISA Fund as of the close of business on the
Valuation Date shall be certified by the ERISA Fund's transfer agent.
5. COVENANTS WITH RESPECT TO THE GINTEL FUND AND THE ERISA FUND
5.1 The ERISA Fund will call a special meeting of shareholders (the
"Meeting") for the purposes of (i) considering adoption of this Agreement by the
shareholders of the ERISA Fund; and (ii) considering such other business as may
properly come before such Meeting.
5.2 The ERISA Fund covenants that the Gintel Fund Shares to be issued
hereunder are not being acquired for the purpose of making any distribution
thereof, other than in connection with the Reorganizations contemplated by this
Agreement.
5.3 The ERISA Fund will assist the Gintel Fund in obtaining such
information as the Gintel Fund reasonably requests concerning the beneficial
ownership of the shares of the ERISA Fund.
5.4 Subject to the provisions hereof, the Gintel Fund and the ERISA Fund
will take, or cause to be taken, all actions, and do or cause to be done, all
things reasonably necessary, proper or advisable to consummate and make
effective the transactions contemplated herein, including the obtaining of any
required regulatory approvals.
5.5 The ERISA Fund shall furnish to the Gintel Fund at the Closing Date, a
final statement of the ERISA Fund's assets and
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<PAGE>
liabilities as of the Closing Date, which statement shall be certified by the
ERISA Fund as being determined in accordance with generally accepted accounting
principles consistently applied or in accordance with another mutually agreed
upon standard.
5.6 The Gintel Fund has prepared and filed, or will prepare and file, with
the Securities and Exchange Commission (the "SEC") a registration statement on
Form N-14 under the Securities Act of 1933, as amended (the "1933 Act"),
relating to the Gintel Fund Shares of the Gintel Funds (the "Form N-14
Registration Statement"). The ERISA Fund has provided or will provide the Gintel
Fund with such information and documents relating to the ERISA Fund as are
requested by the Gintel Fund and as are reasonably necessary for the preparation
of the Prospectus/Proxy Statement set forth in the Form N-14 Registration
Statement, and information relating to the notice of meeting and form of proxy,
other information needed for the Form N-14 Registration Statement and any other
proxy solicitation materials to be used in connection with the Meeting
(collectively, the "Proxy Materials"). The Gintel Fund will use all reasonable
efforts to have the Registration Statement become effective under the 1933 Act
as soon as practicable, and will take all actions, if any, required by law to
qualify the Gintel Fund Shares to be issued in the Reorganization under the laws
of the states in which such qualification is required.
5.7 The ERISA Fund: (a) as soon after the Closing Date as is reasonably
practicable, shall prepare and file all federal and other tax returns and
reports as may be required by law to be filed with respect to all periods ending
on or before the Closing Date but not theretofore filed and (b) shall submit for
payment to the Gintel Fund the amount of any federal and other taxes, if any,
shown as due thereon which were not paid on or before the Closing Date and shall
reflect on the unaudited statement of assets and liabilities of the ERISA Fund
referred to in paragraphs 1.3 and 4.5 all Federal and other taxes, if any, that
remain unpaid as of the Closing Date.
5.8 The Gintel Fund agrees to use all reasonable efforts to maintain in
effect the approvals and authorizations required by the 1933 Act, the 1940 Act
and such of the state securities laws as may be necessary and as it may deem
appropriate in order to continue to conduct its operations through the Closing
Date and to consummate the Reorganization, as contemplated herein. The Gintel
Fund agrees to use all reasonable efforts to operate substantially in accordance
with its then current Prospectus and Statement of Additional Information,
including qualifying as a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code") through the Closing Date
and for at least one (1) year thereafter, although the Gintel Fund may merge or
consolidate during such one-year period with an investment company with
investment objectives, policies and restrictions and other characteristics
comparable (or, in the
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case of expense ratios, more favorable) to those of the Gintel Fund.
6. REPRESENTATIONS AND WARRANTIES
6.1 The Gintel Fund represents and warrants to the ERISA Fund as follows:
(a) The Gintel Fund is a business trust validly existing under the
laws of the Commonwealth of Massachusetts and is duly registered as an
open-end, management investment company under the 1940 Act;
(b) The Gintel Fund is not in violation of, and the execution,
delivery and performance of this Agreement will not result in a violation
of, the Gintel Fund's Agreement and Declaration of Trust or By-Laws or
result in a material breach or violation of, or constitute a material
default under, any agreement or other undertaking to which the Gintel Fund
is a party or by which it or its assets is bound;
(c) The execution, delivery and performance of this Agreement has been
duly authorized by all necessary action on the part of the Gintel Fund, and
assuming this Agreement is enforceable against the ERISA Fund, this
Agreement is a valid and binding obligation of the Gintel Fund enforceable
in accordance with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights and to general equity principles;
(d) Except as disclosed in writing to and accepted by the ERISA Fund,
no litigation or administrative proceeding or investigation of or before
any court or governmental body is presently pending or to its knowledge
threatened against the Gintel Fund or any of its properties or assets, and
the Gintel Fund knows of no facts that might form the basis for the
institution of any such proceedings (other than routine inquiries and
examinations), and the Gintel Fund is not a party to or subject to the
provisions of any order, decree or judgment of any court or governmental
body that materially and adversely affects, or is reasonably likely to
materially and adversely affect, its business or its ability to consummate
the transactions contemplated herein;
(e) All of the Gintel Fund's issued and outstanding shares
representing interests in the Gintel Fund are, and on the Closing Date will
be, duly authorized and validly issued and outstanding, and fully paid and
non-assessable (except as disclosed in the Gintel Fund's Prospectus and
recognizing that, under Massachusetts law, shareholders of the Gintel Fund
could, under certain circumstances, be held personally
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<PAGE>
liable for obligations of the Gintel Fund), and no shareholder has any
preemptive rights to purchase any such shares, and the Gintel Fund does not
have outstanding any options, warrants or other rights to subscribe for or
purchase any of its shares (other than dividend reinvestment plans of the
Gintel Fund or as set forth in this Agreement), nor are there outstanding
any securities convertible into any shares of the Gintel Fund (except
pursuant to exchange privileges described in the current Prospectus and
Statement of Additional Information of the Gintel Fund);
(f) The Gintel Fund Shares to be issued and delivered by the Gintel
Fund to the ERISA Fund pursuant to the terms hereof will have been duly
authorized as of the Closing Date and, when so issued and delivered, will
be duly authorized and validly issued, fully paid and non-assessable
(except as disclosed in the Gintel Fund's Prospectus and recognizing that,
under Massachusetts law, shareholders of the Gintel Fund could, under
certain circumstances, be held personally liable for obligations of the
Gintel Fund), and have been or will be duly registered under the 1933 Act
and qualified for sale under the laws of such states where such
qualification is required;
(g) All issued and outstanding shares of the Gintel Fund have been
offered and sold in compliance in all material respects with applicable
registration requirements of the 1933 Act and applicable state securities
laws;
(h) From the effective date of the Form N-14 Registration Statement
through the time of the Meeting and the Closing Date, the Form N-14
Registration Statement (exclusive of those portions based upon written
information regarding the ERISA Fund which fully and fairly discloses such
information) (i) complies in all material respects with the 1933 Act, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the 1940
Act, and the rules and regulations thereunder and (ii) does not and will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and as of such dates and times, any
written information furnished by the Gintel Fund to the ERISA Fund for use
in the Proxy Materials does not contain and will not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the information provided not misleading;
(i) The Statement of Assets and Liabilities, Statement of Operations
and Statement of Changes in Net Assets of the Gintel Fund as of and for the
Gintel Fund's most recent fiscal year, certified by Richard A. Eisner &
Company, LLP, and the unaudited Statement of Assets and Liabilities,
Statement of Operations and Statement of Changes in Net
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<PAGE>
Assets for the Gintel Fund's most current completed six month period within
the fiscal year, if any (copies of which have been or will be furnished to
the ERISA Fund, if available) fairly present, in all material respects, the
Gintel Fund's financial condition as of such dates and its results of
operations for such periods in accordance with generally accepted
accounting principles consistently applied, and as of such dates there were
no liabilities of the Gintel Fund (contingent or otherwise) known to the
Gintel Fund that were not disclosed therein but that would be required to
be disclosed therein in accordance with generally accepted accounting
principles;
(j) Since the date of the most recent audited financial statements,
there has not been any material adverse change in the Gintel Fund's
financial condition, assets, liabilities or business, other than changes
occurring in the ordinary course of business, except as otherwise disclosed
in writing to and accepted by the ERISA Fund prior to the Closing Date (for
the purposes of this subparagraph (j), neither a decline in the Gintel
Fund's net asset value per share nor a decrease in the Gintel Fund's size
due to redemptions shall be deemed to constitute a material adverse
change);
(k) All federal and other tax returns and reports of the Gintel Fund
required by law to be filed on or before the Closing Date, if any, shall
have been filed, and all federal and other taxes owed by the Gintel Fund
shall have been paid so far as due, and to the best of the Gintel Fund's
knowledge, no such return is as of the date hereof under audit and no
material assessment has been asserted with respect to any such return;
(l) For each full and partial taxable year from its inception through
the Closing Date, the Gintel Fund has qualified as a regulated investment
company under Subchapter M of the Code; and
(m) The Gintel Fund will provide to the ERISA Fund the Form N-1A
registration statement concerning the Gintel Fund, which will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make any statements therein,
in light of the circumstances under which such statements were made, not
materially misleading.
6.2 The ERISA Fund represents and warrants to the Gintel Fund as follows:
(a) The ERISA Fund is a business trust validly existing under the laws
of the Commonwealth of Massachusetts, and is duly registered as an
open-end, management investment company under the 1940 Act;
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(b) The ERISA Fund is not in violation of, and the execution, delivery
and performance of this Agreement will not result in a violation of, the
ERISA Fund's Agreement and Declaration of Trust or By-Laws each as amended
to date, or result in a material breach or violation of, or constitute a
material default under, any agreement or other undertaking to which the
ERISA Fund is a party or by which any of them or their assets are bound;
(c) The execution, delivery and performance of this Agreement has been
duly authorized by all necessary action on the part of the ERISA Fund, and
assuming this Agreement is enforceable against the Gintel Fund, this
Agreement is a valid and binding obligation of the ERISA Fund, enforceable
in accordance with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights and to general equity principles;
(d) Except as otherwise disclosed in writing to and accepted by the
Gintel Fund, no litigation or administrative proceeding or investigation of
or before any court or governmental body is presently pending or to its
knowledge threatened against the ERISA Fund or any of its properties or
assets, and the ERISA Fund knows of no facts that might form the basis for
the institution of any such proceedings (other than routine inquiries and
examinations), and the ERISA Fund is not a party to or subject to the
provisions of any order, decree or judgment of any court or governmental
body that materially and adversely affects, or is reasonably likely to
materially and adversely affect, its business or its ability to consummate
the transactions contemplated herein;
(e) All of the ERISA Fund's issued and outstanding shares representing
interests in the ERISA Fund are, and on the Closing Date will be, duly
authorized and validly issued and outstanding, and fully paid and
non-assessable (except as disclosed in the ERISA Fund's Prospectus and
recognizing that, under Massachusetts law, shareholders of the ERISA Fund
could, under certain circumstances, be held personally liable for
obligations of the ERISA Fund) and all such shares will, at the time of the
Closing, be held by the Participating Shareholders of Record as set forth
on the books and records of the ERISA Fund's transfer agent (and in the
amounts set forth therein) and as set forth in any list of Participating
Shareholders of Record provided to the Gintel Fund pursuant to paragraph
3.4, and no Participating Shareholders of Record will have any preemptive
rights to purchase any of such shares and the ERISA Funds do not have
outstanding any options, warrants or other rights to subscribe for or
purchase any of its shares (other than dividend reinvestment plans of the
ERISA Fund or as set forth in this Agreement), nor are there outstanding
any
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securities convertible into any shares of the ERISA Fund (except pursuant
to exchange privileges described in the current Prospectus and Statement of
Additional Information of the ERISA Fund);
(f) All of the ERISA Fund's issued and outstanding shares have been
offered and sold in compliance in all material respects with applicable
registration requirements of the 1933 Act and applicable state securities
laws;
(g) From the effective date of the Form N-14 Registration Statement
through the time of the Meeting and the Closing Date, the ERISA Fund's
Proxy Materials (exclusive of any written information furnished by the
Gintel Fund for use in the Proxy Materials which fully and fairly discloses
such information) (i) comply in all material respects with the applicable
provisions of the 1934 Act and the 1940 Act and the rules and regulations
thereunder and (ii) do not and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and as
of such dates and time, any written information furnished by the ERISA Fund
to the Gintel Fund for use in the Form N-14 Registration Statement does not
and will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the information provided not
misleading;
(h) The Statement of Assets and Liabilities, Statement of Operations
and Statement of Change in Net Assets of the ERISA Fund as of and for the
ERISA Fund's most recent fiscal year, certified by Richard A. Eisner &
Company, LLP and the unaudited Statement of Assets and Liabilities,
Statement of Operations and Statement of Changes in Net Assets for the
ERISA Fund's most recently completed six month semi-annual fiscal period
(copies of which have been or will be furnished to the Gintel Fund) fairly
present, in all material respects, the ERISA Fund's financial condition as
of such dates and its results of operations for such periods in accordance
with generally accepted accounting principles consistently applied, and as
of such dates there were no liabilities of the ERISA Fund (contingent or
otherwise) known to the ERISA Fund that were not disclosed therein but that
would be required to be disclosed therein in accordance with generally
accepted accounting principles;
(i) Since the date of the most recent audited financial statements,
there has not been any material adverse change in the ERISA Fund's
financial condition, assets, liabilities or business, other than changes
occurring in the ordinary course of business, except as otherwise disclosed
in writing to and accepted by the Gintel Fund prior to the Closing Date
(for the purposes of this subparagraph (i), neither a decline in the ERISA
Fund's net
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asset value per share nor a decrease in the ERISA Fund's size due to
redemptions shall be deemed to constitute a material adverse change);
(j) All federal and other tax returns and reports of the ERISA Fund
required by law to be filed on or before the Closing Date shall have been
filed, and all federal and other taxes owed by the ERISA Fund shall have
been paid so far as due, and to the best of the ERISA Fund's knowledge, no
such return is as of the date hereof under audit and no material assessment
has been asserted with respect to any such return;
(k) For each full and partial taxable year from its inception through
the Closing Date, the ERISA Fund has qualified as a regulated investment
company under Subchapter M of the Code; and
(l) At the Closing Date, the ERISA Fund will have good and marketable
title, through its custodian, to the ERISA Fund Assets and full right,
power and authority to assign, deliver and otherwise transfer the ERISA
Fund Assets hereunder, and upon delivery and payment for the ERISA Fund
Assets as contemplated herein, the Gintel Fund will acquire good and
marketable title thereto, subject to no restrictions on the ownership or
transfer thereof other than such restrictions as might arise under the 1933
Act.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ERISA FUND
The obligations of the ERISA Fund to complete the Reorganization shall be
subject, at the ERISA Fund's election, to the performance by the Gintel Fund, of
all the obligations to be performed by it hereunder on or before the Closing
Date, and in addition thereto, the following conditions with respect to the
Gintel Fund:
7.1 All representations and warranties of the Gintel Fund contained herein
shall be true and correct in all material respects as of the date hereof and,
except as they may be affected by the transactions contemplated herein, as of
the Closing Date, with the same force and effect as if made on and as of the
Closing Date.
7.2 The Gintel Fund shall have delivered to the ERISA Fund at the Closing a
certificate executed by one of its officers, dated as of the Closing Date, to
the effect that the representations and warranties of the Gintel Fund made
herein are true and correct at and as of the Closing Date, except as they may be
affected by the transactions contemplated herein, and as to such other matters
as the ERISA Fund shall reasonably request.
7.3 The ERISA Fund shall have received at the Closing an opinion of legal
counsel to the Gintel Fund, dated as of the
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Closing Date, in form (including reasonable and customary qualifications and
assumptions) reasonably satisfactory to the ERISA Fund, substantially to the
effect that:
(i) the Gintel Fund is a business trust validly existing under the
laws of the Commonwealth of Massachusetts and is duly registered as an
open-end, management investment company under the 1940 Act; (ii) the
execution, delivery and performance of this Agreement will not result in a
violation of the Gintel Fund's Agreement and Declaration of Trust or
By-Laws; (iii) the execution, delivery and performance of this Agreement
have been duly authorized by all necessary action on the part of the Gintel
Fund, and this Agreement has been duly executed and delivered by the Gintel
Fund and is a valid and binding obligation of the Gintel Fund, enforceable
in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights or remedies and to general equity principles (regardless
of whether considered at a proceeding in law or equity), equitable defenses
or waivers and the discretion of the court before which any proceeding for
specific performance, injunctive and other forms of equitable relief may be
brought; (iv) to the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental authority of the United
States, the Commonwealth of Massachusetts or the State of New York is
required for the consummation by the Gintel Fund of the Reorganization,
except such as are contemplated hereunder or as are required to be obtained
under the 1933 Act, the 1934 Act or the 1940 Act, or such as may be
required under applicable state laws; (v) except as disclosed in writing to
the ERISA Fund, to the best knowledge of such counsel, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or, to the best knowledge of such
counsel, threatened against the Gintel Fund or any of its properties or
assets, and, to the best knowledge of such counsel, the Gintel Fund is not
a party to or subject to the provisions of any order, decree not of general
application or judgment of any court or governmental body that materially
and adversely affects its business or its ability to consummate the
transactions contemplated herein; and (vi) the Gintel Fund Shares to be
issued and delivered pursuant to the terms of this Agreement will have been
duly authorized as of the Closing Date and, when so issued and delivered,
will be validly issued, fully paid and non-assessable (except as disclosed
in the Gintel Fund's Registration Statement and recognizing that under
Massachusetts law, shareholders of an the Gintel Fund could, under certain
circumstances, be held personally liable for obligations of the Gintel
Fund). In addition, such counsel also shall state that they have
participated in certain conferences with trustees, officers or other
representatives of the Gintel Fund at which the
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<PAGE>
contents of the Prospectus/Proxy Statement and related matters were
discussed and, although they are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Prospectus/Proxy Statement or Registration Statement, on
the basis of the foregoing (relying as to materiality to a large extent
upon the opinions of officers and other representatives of the Gintel
Fund), no facts have come to their attention that lead them to believe that
the Prospectus/Proxy Statement as of its date, as of the date of the ERISA
Fund's shareholders' meeting, and as of the Closing Date, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein regarding the Gintel Fund or necessary to
make the statements therein regarding the Gintel Fund, in the light of the
circumstances under which they were made, not misleading. Such opinion may
state that such counsel does not express any opinion or belief as to the
financial statements, fee tables, capitalization tables or other financial
data or as to the information relating to the ERISA Fund, contained in the
Prospectus/Proxy Statement or Registration Statement, and that such opinion
is solely for the benefit of the ERISA Fund, its trustees and its officers.
Such opinion also shall include such other matters incident to the
Reorganizations as the ERISA Fund may reasonably request.
In rendering such opinion, legal counsel to the Gintel Fund may rely
on an opinion of Massachusetts counsel (with respect to matters of
Massachusetts law) and on certificates of officers or trustees of the
Gintel Fund, in each case reasonably acceptable to the ERISA Fund.
7.4 As of the Closing Date, there shall have been no material change in the
investment objective, policies and restrictions of the Gintel Fund nor any
increase in the rate of permissible investment advisory or other fees or charges
payable by the Gintel Fund or its shareholders to the Gintel Fund's investment
adviser, distributor and/or administrator from those fees and charges described
in the current Prospectus of the Gintel Fund delivered to the ERISA Fund, and
there shall have been no change in any fee waiver or expense reimbursement
undertakings described in the Proxy Materials.
7.5 The Board of Trustees of the Gintel Fund, including a majority of its
trustees who are not "interested persons" of the Gintel Fund (as defined in the
1940 Act), shall have determined that this Agreement and the transactions
contemplated hereby are in the best interests of the Gintel Fund and that the
interest of shareholders of the Gintel Fund would not be diluted as a result of
such transactions, and the Gintel Fund shall have delivered to the ERISA Fund at
the Closing, a certificate, executed by an officer, to the effect that the
condition described in this paragraph has been satisfied.
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<PAGE>
7.6 The Gintel Fund shall have delivered to the ERISA Fund, pursuant to
paragraph 5.1(i), copies of financial statements as of and for its most recently
completed fiscal year.
8. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE GINTEL FUND
The obligations of the Gintel Fund to complete the Reorganization shall be
subject, at the Gintel Fund's election, to the performance by the ERISA Fund of
all the obligations to be performed by it hereunder on or before the Closing
Date and, in addition thereto, the following conditions with respect to the
ERISA Fund:
8.1 All representations and warranties of the ERISA Fund contained herein
shall be true and correct in all material respects as of the date hereof and,
except as they may be affected by the transactions contemplated herein, as of
the Closing Date, with the same force and effect as if made on and as of the
Closing Date.
8.2 The ERISA Fund shall have delivered, in accordance with Article 1
hereof, to the Gintel Fund a statement of the ERISA Fund Assets and Stated
Liabilities of together, if required by the Gintel Fund, with a list of the
ERISA Fund's portfolio securities and other assets showing the respective
adjusted bases and holding periods thereof for income tax purposes, as of the
Closing Date, certified by an appropriate officer of the ERISA Fund.
8.3 The ERISA Fund shall have delivered to the Gintel Fund at the Closing a
certificate executed by one of its officers, and dated as of the Closing Date,
to the effect that the representations and warranties of the ERISA Fund made
herein are true and correct at and as of the Closing Date, except as they may be
affected by the transactions contemplated herein, and as to such other matters
as the Gintel Fund shall reasonably request.
8.4 The Gintel Fund shall have received at the Closing an opinion of legal
counsel to the ERISA Fund, dated as of the Closing Date, in form (including
reasonable and customary qualifications and assumptions) reasonably satisfactory
to the Gintel Fund, substantially to the effect that:
(i) the ERISA Fund is a business trust validly existing under the laws
of the Commonwealth of Massachusetts and is duly registered as an open-end,
management investment company under the 1940 Act; (ii) the execution,
delivery and performance of this Agreement will not result in a violation
of the ERISA Fund's Agreement and Declaration of Trust or By-laws; (iii)
the execution, delivery and performance of this Agreement have been duly
authorized by all necessary action on the part of the ERISA Fund, and this
Agreement has been duly authorized and delivered by the ERISA Fund and is
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<PAGE>
a valid and binding obligation of the ERISA Fund, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights or
remedies and to general equity principles (regardless of whether considered
in a proceeding in law or equity), equitable defenses or waivers and the
discretion of the court before which any proceeding for specific
performance, injunctive and other forms of equitable relief may be brought;
(iv) to the knowledge of such counsel, no consent, approval, authorization
or order of any court or governmental authority of the United States or the
Commonwealth of Massachusetts or State of New York is required for the
consummation by the ERISA Fund of the Reorganization, except such as are
contemplated hereunder or as are required to be obtained under the 1933
Act, the 1934 Act or 1940 Act, or such as may be required under applicable
state laws; and (v) except as otherwise disclosed in writing to the Gintel
Fund, to the best knowledge of such counsel, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or, to the best knowledge of such
counsel, threatened against the ERISA Fund or any of its properties or
assets, and, to the best knowledge of such counsel, the ERISA Fund is not a
party to or subject to the provisions of any order, decree not of general
application or judgment of any court or governmental body that materially
and adversely affects its business or its ability to consummate the
transactions contemplated herein. Such counsel also shall state that they
have participated in certain conferences with trustees, officers or other
representatives of the ERISA Fund at which the contents of the
Prospectus/Proxy Statement and related matters were discussed and, although
they are not passing upon and do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Prospectus/Proxy Statement or Registration Statement, on the basis of the
foregoing (relying as to materiality to a large extent upon the opinions of
officers and other representatives of the ERISA Fund), no facts have come
to their attention that lead them to believe that the Prospectus/Proxy
Statement as of its date, as of the date of the ERISA Fund's shareholders'
meeting, and as of the Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
herein regarding the ERISA Fund or necessary in the light of the
circumstances under which they were made, to make the statements therein
regarding the ERISA Fund not misleading. Such opinion may state that such
counsel does not express any opinion or belief as to the financial
statements, fee tables, capitalization tables or other financial data, or
as to the information relating to the Gintel Fund, contained in the
Prospectus/Proxy Statement or Registration Statement, and that such opinion
is solely for the benefit of the Gintel Fund, its trustees and officers.
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<PAGE>
Such opinion also shall include such other matters incident to the
Reorganization as the Gintel Fund may reasonably request.
In rendering such opinion, legal counsel to the ERISA Fund may rely on an
opinion of Massachusetts counsel (with respect to matters of Massachusetts law)
and on certificates of officers or trustees of the trust, in each case
reasonably acceptable to the Gintel Fund.
8.5 The Gintel Fund shall have received from Richard A. Eisner & Company,
LLP a letter addressed to the ERISA Fund and the Gintel Fund and dated as of the
effective date of the Registration Statement in form and substance satisfactory
to the Gintel Fund, to the effect that:
(a) they are independent public accountants with respect to the ERISA
Fund within the meaning of the 1933 Act and the applicable regulations
thereunder;
(b) in their opinion, the financial statements and per unit income and
capital changes of the ERISA Fund included or incorporated by reference in
the Form N-14 Registration Statement and reported on by them comply as to
form in all material aspects with the applicable accounting requirements of
the 1933 Act and the regulations thereunder;
(c) on the basis of limited procedures agreed upon by the Gintel Fund
and the ERISA Fund and described in such letter (but not an audit in
accordance with generally accepted auditing standards) with respect to the
unaudited pro forma financial statements of the ERISA Fund included in the
Form N-14 Registration Statement and the Proxy Materials, and inquiries of
appropriate officials of the ERISA Fund or the trustee(s) thereof
responsible for financial and accounting matters, nothing came to their
attention which caused them to believe that (i) such unaudited pro forma
financial statements do not comply as to form in all material respects with
the applicable accounting requirements of the 1933 Act and the published
rules and regulations thereunder, or (ii) such unaudited pro forma
financial statements are not fairly presented in conformity with generally
accepted accounting principles applied on a basis substantially consistent
with that of the audited financial statements; and
(d) on the basis of limited procedures agreed upon by the Gintel Fund
and the ERISA Fund and described in such letter (but not an examination in
accordance with generally accepted auditing standards), the information
relating to the ERISA Fund appearing in the Form N-14 Registration
Statement and the Proxy Materials that is expressed in dollars or
percentages of dollars (with the exception of performance comparisons) has
been obtained from the
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<PAGE>
accounting records of the ERISA Fund or from schedules prepared by officers
of the ERISA Fund having responsibility for financial and reporting matters
and such information is in agreement with such records, schedules or
computations made therefrom.
8.6 The ERISA Fund shall have delivered to the Gintel Fund, pursuant to
paragraph 5.2(h), copies of financial statements of the ERISA Fund as of and for
its most recently completed fiscal year.
8.7 The Gintel Fund shall have received from Richard A. Eisner & Company,
LLP a letter addressed to the ERISA Fund and the Gintel Fund and dated as of the
Closing Date stating that as of a date no more than three (3) business days
prior to the Closing Date, Richard A. Eisner & Company, LLP performed limited
procedures in connection with the ERISA Fund's most recent unaudited financial
statements and that (a) nothing came to their attention in performing such
limited procedures or otherwise that led them to believe that there had been any
adverse changes in the financial condition, assets, liabilities or business of
the ERISA Fund, other than changes occurring in the ordinary course of business,
since the date of such audited financial statements, and (b) based on such
limited procedures, the representations made in their report on such audited
financial statements of the ERISA Fund remain true and correct.
8.8 On the Closing Date, the ERISA Fund Assets shall include no assets that
the Gintel Fund, by reason of the Gintel Fund's Agreement and Declaration of
Trust, 1940 Act requirements or otherwise, may not legally acquire.
8.9 The Board of Trustees of the ERISA Fund, including a majority of the
trustees who are not "interested persons" of the ERISA Fund (as defined by the
1940 Act) shall have determined that this Agreement and the transactions
contemplated hereby are in the best interests of the ERISA Fund and that the
interests of the shareholders in the ERISA Fund would not be diluted as a result
of such transactions, and the ERISA Fund shall have delivered to the Gintel Fund
at the Closing, a certificate, executed by an officer, to the effect that the
condition described in this subparagraph has been satisfied.
9. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ERISA FUND AND THE
GINTEL FUND
The obligations herein of the ERISA Fund and of the Gintel Fund to effect
the Reorganization are each subject to the further conditions that on or before
the Applicable Closing Date:
8.1 This Agreement and the transactions contemplated herein shall have been
approved by the requisite vote of the shareholders of the ERISA Fund in
accordance with the applicable provisions of the ERISA Fund's Agreement and
Declaration of Trust
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and By-laws and the requirements of the 1940 Act, and evidence of such approval
shall have been delivered to the Gintel Fund.
8.2 No action, suit or other proceeding shall be pending or threatened
before any court or governmental agency in which it is sought to restrain or
prohibit, or obtain damages or other relief in connection with, this Agreement
as it relates to the Reorganization or any of the transactions related thereto.
8.3 All consents of other parties and all other consents, approvals and
permits of federal, state and local regulatory authorities (including, without
limitation, those of the SEC and of state securities authorities, including
"no-action" positions of or exemptive orders from such federal and state
authorities, and those of the Office of the Comptroller of the Currency ("OCC")
and the Department of Labor with respect to the Employee Retirement Income
Security Act of 1974 ("ERISA") or the Internal Revenue Service with respect to
the Code, deemed necessary by the Gintel Fund or the ERISA Fund to permit
consummation, in all material respects, of the Reorganization and transactions
related thereto shall have been obtained, except where failure to obtain any
such consent, order or permit would not, in the reasonable opinion of the party
asserting that the condition to closing has not been satisfied, involve a risk
of a material adverse effect on the assets or properties of the Gintel Fund or
the ERISA Fund involved in the Reorganization.
8.4 The Form N-14 Registration Statement and the Gintel Fund's registration
statement on Form N-1A covering the continuous offering of shares of the Gintel
Fund shall have become and shall be effective under the 1933 Act, no stop orders
suspending the effectiveness thereof shall have been issued and, to the best
knowledge of the ERISA Fund and the Gintel Fund, no investigation or proceeding
for that purpose shall have been instituted or be pending, threatened or
contemplated under the 1933 Act.
8.5 The Gintel Fund and the ERISA Fund shall have received an opinion of
legal counsel to the Gintel Fund, dated the Closing Date of the Reorganization,
addressed to, and in form and substance satisfactory to, the Gintel Fund and the
ERISA Fund to the effect that: (i) the exchange by the ERISA Fund of
substantially all its assets in exchange for shares of the Gintel Fund and the
assumption by the Gintel Fund of the liabilities of the ERISA Fund pursuant to
the Agreement will constitute a reorganization within the meaning of section
368(a)(1)(C) or 368(a)(1)(D) of the Code, respectively, depending upon whether
shareholders of the ERISA Fund receive in the aggregate less than fifty percent,
or fifty percent or more, of the shares of the Gintel Fund; (ii) the ERISA Fund
will not recognize any gain or loss as a result of the Reorganization; (iii) the
Gintel Fund will not recognize any gain or loss as a result of the
Reorganization; (iv) shareholders of the ERISA Fund will not
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recognize any gain or loss on the exchange of the ERISA Fund shares for the
Gintel Fund shares in the Reorganization; (v) the basis of the Gintel Fund
shares received by a shareholder will equal the basis of the shareholder's ERISA
Fund shares immediately prior to the Reorganization; (vi) the holding period of
the Gintel Fund shares received in the Reorganization by the ERISA Fund
shareholder will include the holding period during which he held the ERISA Fund
shares exchanged therefor as a capital asset as of the time of the
Reorganization; and (vii) the bases and holding periods of the Gintel Fund in
the assets of the ERISA Fund received in the Reorganization will equal the bases
and will include the holding periods, respectively, of such assets in the hands
of the ERISA Fund immediately prior to the Reorganization.
9. BROKERAGE FEES AND EXPENSES
9.1 The ERISA Fund represents and warrants to the Gintel Fund, and the
Gintel Fund represents and warrants to the ERISA Fund, that there are no brokers
or finders entitled to receive any payments in connection with the transactions
provided for herein.
9.2 The ERISA Fund and the Gintel Fund confirm their understanding that
each party will be responsible for its own expenses in connection with each
Reorganization, whether or not consummated (excluding extraordinary expenses
such as litigation expenses, damages and other expenses not normally associated
with transactions of the type contemplated by this Agreement).
10. CLOSING.
The Closing shall be held at the offices of the ERISA Fund and shall occur
as of the commencement of business on (a) ________, 1996, or (b) if all
regulatory or shareholder approvals shall not have been received by such date,
then on the first Monday following receipt of all necessary regulatory approvals
and the final adjourned meeting of shareholders of the ERISA Fund at which this
Plan is considered and approved, or (c) such later time as the ERISA Fund may
determine, giving consideration to the best interests of the ERISA Fund. All
acts taking place at the Closing shall deemed to take place simultaneously
unless otherwise provided.
11. ARTICLES OF AMENDMENT.
For purposes of Massachusetts corporation law, the transactions
contemplated by this Plan will be effectuated by Articles of Amendment,
substantially in the form attached hereto as Exhibit A, which will amend the
Agreement and Declaration of Trust of the ERISA Fund to provide, among other
things, that all shares of the ERISA Fund will be exchanged for, and converted
and reclassified into, New Shares.
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<PAGE>
12. EXPENSES.
The expenses of the transactions contemplated by this Plan shall be borne
by the Gintel Fund and the ERISA Fund, whether or not the transactions
contemplated hereby are consummated.
13. TERMINATION.
This Plan and the transactions contemplated hereby may be terminated and
abandoned by resolution of the Board of Trustees of the ERISA Fund, at any time
prior to the Closing, if circumstances should develop that, in the opinion of
the Board, in its sole discretion, make proceeding with this Plan inadvisable
for either Portfolio. In the event of any such termination, there shall be no
liability for damages on the part of either Portfolio, or its agent or officers,
to the other Portfolio, or its agents or officers.
14. AMENDMENTS.
This Plan may be amended, waived or supplemented in such manner as may be
mutually agreed upon in writing by the authorized officers of the ERISA Fund
with respect to either Portfolio; provided, however, that following the meeting
of the ERISA Fund shareholders called by the ERISA Fund pursuant to Section 4(f)
of this Plan, no such amendment, waiver or supplement may have the effect of
changing the provisions for determining the amount of New Shares to be issued to
the ERISA Fund shareholders under this Plan, or otherwise to the detriment of
such shareholders, without their further approval.
15. GOVERNING LAW.
This Plan shall be governed and construed in accordance with the laws of
Massachusetts, without giving effect to the conflicts of laws provisions
thereof.
16. FURTHER ASSURANCES.
The ERISA Fund, with respect to the ERISA Fund and the Gintel Fund, shall
take such further action, prior to, at, and after the Closing, as may be
necessary or desirable and proper to consummate the transactions contemplated
hereby.
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<PAGE>
IN WITNESS WHEREOF, the Board of Trustees of the ERISA Fund has caused this Plan
to be executed on behalf of the ERISA Fund as of the date first set forth above
by their duly authorized representatives.
GINTEL ERISA FUND
Attest:
By:______________________________
________________
GINTEL FUND
Attest:
By:___________________________
_________________
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<PAGE>
PART B
Related Statement of Additional Information
GINTEL FUND
This Related Statement of Additional Information is not a prospectus but
should be read in conjunction with the Combined Proxy Statement/Prospectus dated
_______, 1996, which may be obtained from Gintel Fund, 6 Greenwich Office Park,
Greenwich, Connecticut 06831. Further information about the Gintel ERISA Fund
and Gintel Fund is contained in and incorporated by reference to the Statement
of Additional Information of the Gintel Fund dated May 1, 1996. Incorporated by
reference herein are: The audited financial statements of the Gintel ERISA Fund
and Gintel Fund for the period ended December 31, 1995.
The pro forma combined statement of assets and liabilities reflects the
financial position of Gintel Fund at ________, 1996 as though the Reorganization
occurred as of that date. The pro forma combined statement of operations and
statement of changes in net assets reflect the results of operations of the
Gintel Fund and Gintel ERISA Fund for the period ended ________, 1996 as though
the Reorganization occurred at the beginning of the period presented.
- 40 -
<PAGE>
<TABLE>
<CAPTION>
Statement of Assets and Liabilities
Six Months Ended June 30, 1996 (Unaudited)
PRO FORMA
GINTEL GINTEL (immediately after
FUND ERISA FUND Reorganizaton)
--------------- -------------- ------------------
ASSETS
Investments in securities, at value----
<S> <C> <C> <C>
(identified cost -- Gintel Fund $ 82,306,084 $ 110,005,437 $ 30,210,125 $ 140,215,562
ERISA Fund $ 27,421,576,
Pro Forma Fund $109,727,660)
Cash 35,482 5 35,487
Deposits with brokers for securities sold short 6,402,907 0 6,402,907
Receivables
Securities sold 1,872,737 2,062,306 3,935,044
Due from broker 954,100 0 954,100
Dividends and interest 381,169 53,287 434,455
Capital stock sold
--------------- -------------- ---------------
Total assets 119,651,832 32,325,723 151,977,555
--------------- -------------- ---------------
LIABILITIES
Securities sold short, at value ----
(proceeds -- Gintel Fund $6,402,907, 6,875,000 0 6,875,000
Pro Forma $6,402,907)
Payables
Securities purchased 2,897,796 3,362,999 6,260,795
Capital stock reaquired 96,664 29,948 126,613
Accrued expenses 10,242 9,861 20,103
--------------- -------------- ---------------
Total liabilities 9,879,703 3,402,808 13,282,511
NET ASSETS $ 109,772,129 $ 28,922,915 $ 138,695,044
=============== ============== ===============
NET ASSET VALUE PER SHARE -- $ 17.94 $ 31.98 $ 17.94
(based on shares outstanding -- Gintel Fund 6,118,707 =============== ============== ===============
ERISA Fund 904,500,
Pro Forma Fund 7,730,910
of beneficial interest (offering and redemption price)
</TABLE>
The accompanying notes to financial statements are an integral part
<PAGE>
<TABLE>
<CAPTION>
Pro Forma Statement of Operations
Six Months Ended June 30, 1996 (Unaudited)
GINTEL GINTEL ERISA PRO FORMA
FUND FUND ADJUSTMENT PRO FORMA
---------- --------- ---------- -----------
<S> <C> <C> <C> <C>
Dividend and interest income $1,771,619 $605,569 $ 2,377,188
---------- --------- -----------
Administrative service fee 579,962 174,126 (33,294)* 720,794
Investment advisory fee 487,743 139,301 627,044
Trustees' fees 13,921 13,921 27,842
State tax expense 994 994 (994)* 994
---------- --------- ---------- -----------
1,082,620 328,342 (34,288) 1,376,674
---------- --------- ---------- -----------
Net investment income 688,999 277,227 1,000,514
---------- --------- -----------
Net realized gain on investments 16,211,902 3,458,446 19,670,348
Change in unrealized appreciation
for the period (1,081,806) (398,201) (1,480,007)
---------- --------- -----------
Net gain on investments 15,130,096 3,060,245 18,190,341
---------- --------- -----------
Net increase in net assets
resulting from operations $15,819,095 3,337,472 $19,190,855
=========== ========= ===========
</TABLE>
* Adjusted to reflect the decrease in the annual rate which would have been
in effect had the funds been combined on January 1, 1996.
The accompanying notes to financial statements are an integral part hereof.
<PAGE>
Pro Forma Notes to Financial Statements June 30, 1996
(Unaudited)
(NOTE A ) -- ORGANIZATION:
The Gintel Fund (the "Fund") is a Massachesetts business trust formed under the
laws of the Commonwealth of Massachusetts with authority to issue an unlimited
number of shares of beneficial interest.
(NOTE B) -- SIGNIFICANT ACCOUNTING POLICIES:
1. Security Valuation
Investments in securities are valued at the last reported sales price on the
last business day of the period, or in the absence of a recorded sale, at the
mean of the closing bid and asked price on that date. Short-term investments are
valued at cost which approximates market value.
2. Federal Income Taxes:
It is the Fund's policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute
substantially all of its taxable income and long-term gains to its shareholders.
Therefore, only a nominal Federal income tax provision is required.
3. Other:
As is common in the industry, security transactions are accounted for on the
trade date. Dividend income and distributions to shareholders are recorded on
the ex-dividend date.
Realized gain or loss on security transactions is determined on the basis of
first-in, first-out or specific identification.
(NOTE C ) -- INVESTMENT ADVISORY AGREEMENT:
The Fund has entered into an Investment Advisory Agreement with Gintel Equity
Management Inc., a related party, which provides for an annual fee of 1% to be
paid quarterly, based on the daily value of the Fund's net assets during the
preceding quarter. The fee will be reduced for any fiscal year, if the Fund's
expenses, as defined, exceed certain limitations.
(NOTE D ) -- ADMINISTRATIVE SERVICES AGREEMENT:
The Fund has entered into an Administrative Services Agreement which provides
that in consideration for the services provided by Gintel & Co., the Fund's
Distributor and a related party, and the payment by the Distributor of
substantially all of the Fund's expenses, including but not limited to brokerage
commissions and operating expenses (but excluding the Investment Advisor's fees,
the fees paid to non-interested Trustees, certain transaction costs, interest,
taxes and extraordinary expenses), the Distributor will receive a fee payable at
the beginning of each quarter based on average daily net assets during the
preceding quarter, at an annual rate of 1.25% of the first $50 million of the
average daily net assets of the Fund, 1.125% of the next $50 million of the
average daily net assets and 1.0% of the average daily net assets in excess of
$100 million.
<PAGE>
Pro Forma Notes to Financial Statements - - - continued June 30, 1996
(Unaudited)
(NOTE E ) -- LINE OF CREDIT:
The Fund has a bank line of credit of $15,000,000. Interest is payable at prime.
Loans are collateralized by securities owned by the Fund. At June 30, 1996 the
Fund had no outstanding borrowings.
(NOTE F ) -- OTHER MATTERS:
1. Investments
Unrealized appreciation at June 30, 1996 $40,045,199
Unrealized depreciation at June 30, 1996 (10,029,390)
----------
$30,015,809
===========
FOR THE SIX MONTHS ENDED JUNE 30, 1996
Purchase of securities other than short-term investments $38,047,411
Sales of securities other than short-term investments $50,728,899
2. Acquisition of Gintel ERISA Fund
Pursuant to a plan of reorganization and upon approval by the shareholders of
the Gintel ERISA Fund, the Gintel Fund will acquire all the net assets of the
Gintel ERISA Fund. If the aquisition had occurred on June 30, 1996, the tax free
exchange of 1,612,203 shares of the Gintel Fund (valued at $29 million) for the
904,500 shares of Gintel ERISA Fund would have occurred. Gintel ERISA Fund's net
assets on June 30,1996 ($29 million), would be combined with those of Gintel
Fund. The aggregate net assets of Gintel Fund and Gintel ERISA Fund immediately
before the proposed acquisition were $109,772,129 and $28,922,915 respectively.
The combined net asstes immediately after the acquisition, based on a date of
June 30, 1996, were $138,695,044. Prior to the acquisition, Gintel ERISA Fund
will distribute substantially all of its undistributed net investment income and
net realized gain on investments. As of July 24, 1996, such amount aggregates
$4,000,000, which may increase or decrease prior to the closing. The Fund does
not anticipate that the net assets will decrease materially by the distribution
since the majority of Gintel ERISA Fund's shareholders are expected to reinvest
their distributions.
3. Capital Stock: ( in shares )
Six Months Year
Ended 6/30/96 Ended 12/31/95
------------- --------------
Shares issued 116,410 115,098
Shares issued in connection with the
acquisition of Gintel ERISA Fund 1,612,203 ----
Shares reinvested ------ 220,009
Shares repurchased (293,480) (1,124,796)
--------- --------
Net increase (decrease) 1,435,133 (789,689)
========= ========
<PAGE>
Part C
Information required to be included in Part C is set forth under the appropriate
Item, so numbered, in Part C to this Registration Statement.
GINTEL FUND
PART C
------
Item 15. Indemnification.
- -------------------------
Reference is hereby made to Article VIII of the Registrant's Declaration
Trust.
The Trustees and officers of the Registrant and the personnel of the
Registrant's investment adviser, administrator and distributor are insured under
an errors and omissions liability insurance policy. The Registrant and its
officers are also insured under the fidelity bond required by Rule 17g-1 under
the Investment Company Act of 1940.
Item 16. Exhibits.
- ------------------
Exhibit No. Description
- ----------- -----------
EX-99.1 Agreement and Declaration of Trust.^(1)
EX-99.2 By-Laws.^(1)
EX-99.3 Inapplicable.
EX-99.4 Form of Agreement and Plan of Reorganization (filed
herewith as Exhibit A to Part A).
EX-99.5 Inapplicable.
EX-99.6 Investment Advisory Agreement.^(1)
EX-99.7 Distribution Agreement.^(1)
EX-99.8 Retirement Plans.^(1)
EX-99.9 Custodian Agreement and Transfer Agency
Agreement.^(1)
EX-99.10 Rule 12b-1 Plan.
- --------
^(1) To be filed by amendment.
- 41 -
<PAGE>
EX-99.11(a) Opinion of Kramer, Levin, Naftalis & Frankel as
to the legality of the securities being issued. ^(1)
EX-99.11(b) Opinion of Peabody & Brown as to the legality of
the securities being issued.^(1)
EX-99.12 Opinion of Kramer, Levin, Naftalis & Frankel as to
tax consequences. (1)
EX-99.13 Inapplicable.
EX-99.14 Consent of Richard A. Eisner & Company, LLP.
EX-99.15 Inapplicable.
EX-99.16 Powers of Attorney. ^(2)
EX-99.17(a) Form of Proxy Card.
EX-99.17(b) The Registrant's declaration to register an
indefinite number of shares pursuant to Rule 24f-2
under the Investment Company Act of 1940.3
EX-99.17(c) Prospectus and Statement of Additional
Information of Gintel Fund including
audited financial statements as of December 31,
1995.^(4)
- --------
^(2) Incorporated herein by reference to Post-Effective Amendment No. 1 to the
Registration Statement on Form N-1A of the Registrant (File No. 2-70207)
filed on June 5, 1981.
^(3) Registrant has registered an indefinite number of its securities under the
Securities Act of 1933 pursuant to Rule 24f-2 under the Investment Company
Act of 1940. The Registrant electronically filed its Rule 24f-2 Notice for
its fiscal year ended December 31, 1995 on February 23, 1996, accession
number 0000922423-96- 000072.
^(4) Incorporated herein by reference to Post-Effective Amendment No. 19 to the
Registration Statement on Form N-1A of the Registrant (File No. 2-70207) as
filed electronically with the Securities and Exchange Commission on April
30, 1996, accession number 0000950123-96-001954.
- 42 -
<PAGE>
Item 17. Undertakings
- ---------------------
(1) The undersigned Registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is
a part of this Registration Statement by any person or party who is
deemed to be an underwriter within the meaning of Rule 145(c) of the
Securities Act [17 CFR 230.145c], the reoffering prospectus will
contain the information called for by the applicable registration form
for reofferings by persons who may be deemed underwriters, in addition
to the information called for by the other items of the applicable
form.
(2) The undersigned Registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as a part of an amendment to
the Registration Statement and will not be used until the amendment is
effective, and that, in determining any liability under the 1933 Act,
each post-effective amendment shall be deemed to be a new registration
statement for the securities offered therein, and the offering of the
securities at that time shall be deemed to be the initial bona fide
offering of them.
- 43 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has caused this Registration Statement to be signed on its behalf in the City of
Greenwich in the State of Connecticut on the 29 day of July, 1996.
GINTEL FUND
By:/s/ Robert M. Gintel
--------------------
Robert M. Gintel
Chairman of the Board
As required by the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities and on the dates
indicated:
Signatures Title Date
- ---------- ----- ----
/s/ Robert M. Gintel Chief Executive July 29, 1996
- ----------------------------------- Officer, Chairman
Robert M.Gintel of the Board and
Trustee (Principal
Executive Officer)
* Trustee July 29, 1996
- -----------------------------------
Thomas H. Lenagh
* Trustee July 29, 1996
- -----------------------------------
Francis J. Palamara
* Trustee July 29, 1996
- -----------------------------------
Russel R. Taylor
/s/ Stephen G. Stavrides Trustee, Vice July 29, 1996
- ----------------------------------- President,
Stephen G. Stavrides Secretary and
Treasurer
(Principal Financial
and
Accounting Officer)
*By /s/Susan J. Penry-Williams July 29, 1996
-------------------------------
Susan J. Penry-Williams,
Attorney-in-fact, pursuant to
powers of attorney previously filed
with the Securities and Exchange
Commission
- 44 -
<PAGE>
INDEX TO EXHIBITS
-----------------
Exhibit Number
- --------------
EX-99.14 Consent of Richard A. Eisner & Company, LLP.
EX-99.17(a) Form of Proxy Card.
- 45 -
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in the Statement of
Additional Information of the Registration Statement being filed under the
Securities Act of 1933 on Form N-14 by Gintel Fund of our reports dated January
22, 1996, relating to the statement of net assets of Gintel Fund and Gintel
ERISA Fund as at December 31, 1995, the related statements of operations for the
year then ended, changes in net assets for each of the years in the two-year
period then ended, and the condensed financial information for each of the
periods indicated appearing in the Forms N-1A of Gintel Fund and Gintel Erisa
Fund; we also consent to the reference to our Firm under the caption "Financial
Statements" in the Registration Statement.
/s/ Richard A. Eisner & Company, LLP
------------------------------------
New York, New York
July 30, 1996
GINTEL ERISA FUND
SPECIAL MEETING OF SHAREHOLDERS -- _________, 1996
Please refer to the Proxy Statement for a discussion of these matters. THE
UNDERSIGNED HOLDER(S) OF SHARES OF STOCK OF THE GINTEL ERISA FUND HEREBY
CONSTITUTES AND APPOINTS ________________ AND _______________, OR EITHER OF
THEM, THE ATTORNEYS AND PROXIES OF THE UNDERSIGNED, WITH FULL POWER OF
SUBSTITUTION, TO VOTE THE SHARES LISTED BELOW AS DIRECTED, AND HEREBY REVOKES
ANY PRIOR PROXIES. To vote, mark an X in blue or black ink on the proxy card
below. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF GINTEL
ERISA FUND.
- -----Detach card at perforation and mail in postage paid envelope provided------
1. Vote on Proposal to approve an Agreement and Plan of Reorganization
with respect to the Gintel ERISA Fund.
FOR AGAINST ABSTAIN
| | | | | |
2. In their discretion, the proxies are authorized to vote upon such
other business as may properly come before the meeting.
- 48 -
<PAGE>
- -----Detach card at perforation and mail in postage paid envelope provided------
GINTEL ERISA FUND
PROXY
THIS PROXY, WHEN PROPERLY EXECUTED AND RETURNED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR APPROVAL OF EACH PROPOSAL.
Please sign exactly as name appears on
this card. When account is joint
tenants, all should sign. When signing
as administrator, trustee or guardian,
please give title. If a corporation or
partnership, sign in entity's name and
by authorized person.
x_______________________________________
x_______________________________________
Dated:____________________________, 1996
- 49 -
