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<PAGE> PAGE 2
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<PAGE> PAGE 4
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<PAGE> PAGE 7
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<PAGE> PAGE 8
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SIGNATURE LINDSEY PINKHAM
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
this schedule contains summary financial data extracted from the semi annual
report dated June 30, 1996 for the Mutual Investment Fund, of Connecticut, Inc.
and is qualified in its entirety by reference to such semi annual report
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
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<OTHER-ITEMS-LIABILITIES> 496
<TOTAL-LIABILITIES> 496
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 31035
<SHARES-COMMON-STOCK> 1054
<SHARES-COMMON-PRIOR> 938
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<ACCUMULATED-NET-GAINS> 2666
<OVERDISTRIBUTION-GAINS> 0
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<NET-ASSETS> 39618
<DIVIDEND-INCOME> 367
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<OTHER-INCOME> 0
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<REALIZED-GAINS-CURRENT> 2666
<APPREC-INCREASE-CURRENT> 178
<NET-CHANGE-FROM-OPS> 3085
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 241
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 111
<NUMBER-OF-SHARES-REDEEMED> 22
<SHARES-REINVESTED> 27
<NET-CHANGE-IN-ASSETS> 116
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 98
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 159
<AVERAGE-NET-ASSETS> 37405
<PER-SHARE-NAV-BEGIN> 34.77
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<EXPENSE-RATIO> .77
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<AVG-DEBT-PER-SHARE> 0
</TABLE>
MUTUAL INVESTMENT FUND OF CONNECTICUT, INC.
NOTICE OF ANNUAL MEETING
to be held on March 8, 1996
The Annual Meeting of the shareholders of the Mutual Investment Fund of
Connecticut, Inc. (the "Fund") will held at the Rocky Hill Marriott Hotel,
Rocky Hill, Connecticut, on Friday, March 8, 1996, at 1:00 p.m. for the
following purposes:
1. To elect three (3) directors for terms of three years each
until their successors shall be elected.
2. To consider and vote upon an Amended Investment Advisory
Agreement and a Services Agreement with Morgan Guaranty Trust
Company of New York commencing May 1, 1996.
3. To amend the Fund's Certificate of Incorporation and Bylaws to
conform them with certain terms of the Amended Investment
Advisory Agreement and the Services Agreement with Morgan
Guaranty Trust Company of New York, to ease administration of
the Fund and to comply with applicable federal and state laws.
4. To consider and vote upon a proposal to approve the
appointment of the firm of Price Waterhouse LLP to audit the
books and accounts of the Fund for calendar year 1996.
5. To transact such other business as may properly come before
the meeting.
The Board of Directors fixed the close of business on December 31, 1995 as the
record date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting or any adjournments thereof.
Dated: February 20, 1996
By Order of the Board of Directors
/s/ Lindsey R. Pinkham
Lindsey R. Pinkham
Secretary and Treasurer
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING,
PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD AND
RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED.
<PAGE>
MUTUAL INVESTMENT FUND OF CONNECTICUT, INC.
ANNUAL MEETING
TO BE HELD ON
MARCH 8, 1996
PROXIES
The proxies named on the enclosed proxy card were appointed by the Board to vote
the shares represented by the proxy card. Upon receipt by the Mutual Investment
Fund of Connecticut, Inc. (the "Fund") of a properly signed and dated proxy
card, the shares represented thereby will be voted in accordance with the
instructions on the proxy card. If a shareholder does not return a signed proxy
card, those shares so represented cannot be voted by proxy. Shareholders are
urged to mark the boxes on the proxy card to show how their shares are to be
voted. If a shareholder returns a signed proxy card without marking the boxes,
the shares represented by the proxy card will be voted for the elections of
directors and in favor of the other proposals set forth in the Notice. The proxy
card also confers discretionary authority on the proxies to vote on any other
matter not currently known to the management of the Fund that may properly come
before the Annual Meeting. Any proxy delivered pursuant to this solicitation is
revocable at the option of the person(s) executing the same (i) upon receipt by
the Fund before the proxy is voted of a duly executed proxy bearing a later
date, (ii) by written notice of revocation to the Secretary of the Fund received
before the proxy is voted or (iii) by such person(s) voting in person at the
1996 Annual Meeting.
ELECTION OF DIRECTORS
At the Annual Meeting of shareholders of the Fund, three directors are to be
elected to a class whose term will expire at the Annual Meeting in 1999.
It is intended that the shares represented by the accompanying proxy will be
voted for the election of Richard D. Coe, Peter M. Dahlin and Gary C. Smith, for
terms of three years or until their successors shall, in each case, be elected
and qualified. All three nominees were nominated by the Nominating Committee.
Their qualifications are outlined below:
Mr. Coe is President & CEO of Naugatuck Savings Bank. He is currently a
Director of the Fund [filling] an unexpired term and he is eligible for
a first term.
Mr. Dahlin is President, Treasurer & CEO of Thomaston Savings Bank. He
is not a Director of the Fund and is eligible for a first term.
Mr. Smith is President & CEO of Ridgefield Bank. He is currently a
Director of the Fund and he is eligible for a second term.
-2-
<PAGE>
The Fund currently does not compensate directors for their service. Directors
may be reimbursed for reasonable expenses incurred in attending meetings.
If for any reason any of these nominees should be unavailable to serve as a
director at the time of the Annual Meeting, a contingency which is not expected,
the shares represented by the accompanying proxy may be voted for such other
person or persons as may be determined by the holders of the proxy.
APPROVAL OF AN AMENDED INVESTMENT ADVISORY AGREEMENT AND A SERVICES AGREEMENT
WITH MORGAN GUARANTY TRUST COMPANY OF NEW YORK
The Board of Directors has reviewed the Fund's existing relationship with
Morgan Guaranty Trust Company of New York ("Morgan") and, with the approval of
the shareholders at the 1995 Annual Meeting, considered converting the Fund into
the master/feeder mutual fund structure used by certain proprietary mutual funds
of Morgan. Under such a structure, shareholders of the Fund would continue to
purchase shares in the Fund, but the Fund, instead of investing directly in
eligible equity securities would become a "feeder" fund, investing 100% of its
assets in shares of the "master" fund, which must be a fund with identical
investment objectives. The master fund would have a number of feeder funds,
permitting the master fund to take advantage of economies of scale in
structuring investments and in managing expenses.
After consideration of several issues attendant to a conversion to the
master/feeder structure, the Board has determined not to pursue that
alternative. The Board's primary reason for rejecting the conversion is
preserving the extensive operational exemptions from federal securities
regulation granted by the Securities and Exchange Commission (the "SEC"). The
SEC historically has viewed the Fund as a unique mechanism for a small group of
well-defined and sophisticated investors to pool their investment power. The
exemptions enjoyed by the Fund permit it to operate without expensive compliance
with the public disclosure and operational requirements imposed by the SEC on
other investment companies. Because the conversion would have required a
revisiting by the SEC of certain rules and regulations as they apply to the
Fund, the Board determined that maintaining an independent status was
preferable.
In addition, the Board has been updated regularly about the Connecticut banking
statutes and their effect on the Fund. As you know, these statutes were
recodified recently, have already been subject to revisions and the General
Assembly will once again look to make revisions in the current session. The
uncertainty attendant to the numerous revisions to the Connecticut banking
statutes and the possible effect on the Fund's operations and structure has
caused the Board to recommend an independent status to permit the Fund to
respond as necessary to these changes without involving another set of
interested parties, such as the trustees of a master fund.
The Board strongly desires to maintain an investment advisory relationship with
Morgan and has worked collaboratively with Morgan to develop a structure within
which the Fund can continue to operate as an independent fund while enjoying the
benefits of enhanced operational and administrative oversight and services.
Morgan proposes to implement the new structure by reorganizing its contractual
arrangements with the Fund into two separate agreements: an Amended Investment
Advisory Agreement and a new Services Agreement. As outlined below, Morgan would
provide only its investment advisory services under the Amended Investment
Advisory Agreement.
-3-
<PAGE>
It would provide the balance of its services to the Fund and pay certain of the
Fund's expenses under the Services Agreement.
The Amended Investment Advisory Agreement proposed by Morgan will duplicate the
investment advisory services offered under the existing contract. Morgan will
review the investments of the Fund and, from time to time, will make
recommendations to the Fund with respect to sales, changes in investments and
the investment of cash reserves as it may deem advisable. As compensation to
Morgan for its services as investment adviser, the Fund will pay Morgan a fee
that will be computed daily and payable monthly at the following annual rate:
0.50% of the first $74,000,000 of the Fund's average daily net assets;
and
0.45% of the next $75,000,000 of the Fund's average daily net assets
with a minimum annual fee of $125,000.
This fee differs from the fee under the present Investment Advisory Agreement in
two respects:
1. The present Investment Advisory Agreement provides that Morgan will
receive an annual fee at the rate of:
0.50% of the first $75,000,000 of the Fund's gross assets; and
0.45% of the next $75,000,000 of the Fund's gross assets
with a minimum annual fee of $125,000. This fee covers Morgan's investment
advisory, custody and registrar and transfer agent services to the Fund. In
addition, the Investment Advisory Agreement provides that the Fund will pay
Morgan an annual fee of $20,000 for certain administrative and shareholder
services.
The fee rate under the Amended Investment Advisory Agreement is the same as the
fee rate under the present agreement, but it would only cover Morgan's
investment advisory services to the Fund. Morgan proposes to provide its
custody, transfer agent and registrar, administrative and shareholder services
under a new Services Agreement. For the services provided under the new Services
Agreement, Morgan would receive a separate fee. As illustrated in the chart
below, this new fee would increase the Fund's expenses.
2. The investment advisory fee under the Amended Investment Advisory Agreement
will be calculated based on the Fund's average daily net assets. It will be
accrued daily and paid monthly. This is the standard method for calculating and
charging mutual fund investment advisory fees. The present investment advisory
fee is calculated based on the Fund's gross assets at the end of each calendar
quarter. Since under the proposed arrangements, the Fund's net asset value will
be calculated each business day and shareholders will be able to effect
transactions each business day, Morgan believes daily calculation and accrual of
the investment advisory fee is a more appropriate method than the one the Fund
presently uses.
Morgan has proposed that the Fund enter into a Services Agreement with Morgan,
under which Morgan would provide the Fund with custody, fund accounting,
transfer agent and registrar, shareholder servicing and other administrative
services. In addition, Morgan would pay the Fund's usual and customary expenses
out of the fee it receives under the Services Agreement. These
-4-
<PAGE>
expenses include the Fund's legal, accounting, insurance and other
customary expenses. The Fund expenses that would not be paid by Morgan out of
its fee under the Services Agreement but would continue to be paid by the Fund
directly, including the investment advisory fee and extraordinary expenses as
defined in the Services Agreement. The Board would review the amounts paid to
and accounted for by Morgan under the Services Agreement.
Morgan proposes to subcontract its custody and fund accounting
responsibilities to State Street Bank and Trust Company ("SSB"), one of the
largest custodian and fund accountants for domestic funds in the United States
today. In addition, SSB would provide transfer agency services including
maintaining shareholder account records and preparing and sending shareholders
confirmations of their Fund transactions and monthly account statements. Morgan
would pay SSB for its services out of the fee Morgan receives under the Services
Agreement. Morgan would continue to service the Fund shareholders' redemption
and purchase activities, using its shareholder servicing group. The Fund's net
asset value per share would be calculated every business day, and shareholders
would be able to place orders for purchases and redemptions every business day
for settlement the next business day. Shareholders would continue to have access
to the Morgan personnel currently administering the Fund, as well as to a
dedicated "800" number, permitting shareholders to have daily access to
balances, share prices, performance and transactions. Morgan would also continue
to provide the administrative services it has been providing to the Fund which
include compiling financial reports, coordinating the Fund's annual audit, and
preparing and mailing the monthly and annual shareholder reports required by the
Fund's exemptive orders from the SEC. In addition, Morgan would prepare the
Fund's tax returns, develop the Fund's budget and provide daily oversight of
SSB's activities including SSB's calculation of the Fund's daily net asset value
and net income per share and SSB's pricing of the Fund's holdings. As
compensation to Morgan for these services, the Fund would pay a fee that is
computed daily and payable monthly at the annual rate of 0.28% of the Fund's
average daily net assets. The Board understands that these expenses, when
coupled with the expenses under the Amended Investment Advisory Agreement,
[remain] below industry averages for expense ratios for similar funds.
The table that follows compares the costs and expenses of the Fund under its
current arrangements to its pro forma costs should the Fund go forward on the
enhanced services approach. The figures assume average annual assets from
1991-1995 of $35,000,000. Moreover, the figures include ongoing operations
expenses but do not include extraordinary expenses.
New Structure Exsting Structure
Investment Advisory Fee 50.0 BPS $175,000 50.0 BPS $175,000
Custody and Fund Accounting --- ---
Transfer Agency --- ---
Morgan Administration and
Shareholder Servicing* 28.0 BPS 98,000 5.7 BPS 20,000
Audit and Legal Expenses 6.6 BPS 23,000
Insurance and Other 2.9 BPS 10,000
TOTAL 78.0 BPS $273,000 65.2 BPS $228,000
*Under the proposed new Services Agreement, Morgan will provide the services
listed below as well as pay the Fund's usual and customary expenses out of its
fee. Morgan's estimate of the costs of the
-5-
<PAGE>
services to be provided and the amount of the Fund's usual and customary
expenses to be paid is shown below. (These figures assume average annual assets
of $35,000,000.)
New Structure Existing Structure
Custody and Fund Accounting 8.0 BPS $28,000 --- [$]
Transfer Agency 4.3 BPS 15,000 ---
Morgan Administration and
Shareholder Servicing 6.9 BPS 24,000 5.7 BPS 20,000
Audit and Legal Expenses 5.7 BPS 20,000 6.6 BPS 23,000
Insurance and Other 3.1 BPS 11,000 2.9 BPS 10,000
TOTAL 28.0 BPS $98,000 15.2 BPS $53,000
The conversion to the new services program with Morgan is anticipated to occur
on or before May 1, 1996. A complete copy of the Amended Investment Advisory
Agreement and the Services Agreement will be available for your review at the
Annual Meeting. Representatives of Morgan will be available at the Annual
Meeting to discuss these Agreements and to answer any questions you may have.
The Board strongly recommends that the shareholders approve the Amended
Investment Advisory Agreement and Services Agreement. The Board believes that
these agreements will allow the Fund to continue to operate as a unique
investment vehicle while upgrading the level of services provided to the Fund.
AMENDMENT AND RESTATEMENT OF THE CERTIFICATE OF INCORPORATION AND AMENDMENT OF
THE BYLAWS OF THE FUND
The Fund's Certificate of Incorporation would be amended and restated and the
Bylaws would be amended in order to conform them with certain terms of the
proposed Amended Investment Advisory and Services Agreements with Morgan, to
ease administration of the Fund and to comply with applicable federal and state
laws.
The following contains a list of the major changes to the Certificate of
Incorporation:
1. The definition of eligible investors in the Fund, which until
recently was a function of Connecticut statute and upon which
certain of the Fund's exemptive relief was based, is
incorporated into the Certificate of Incorporation.
2. The Certificate of Incorporation would establish a standard
for acceptable securities in which the Fund may invest which
is that same standard imposed by Connecticut statutes on the
equity investment powers of Connecticut banks, as that
standard is amended from time to time.
3. Shareholder action would be permitted under the Certificate of
Incorporation with less that unanimous consent and without the
necessity of a meeting if done in accordance with the general
corporate law of Connecticut and with applicable federal law.
The following contains a list of the major changes to the Bylaws:
1. Permitting shareholders or directors to act by written consent
in lieu of at a meeting.
2. Certificates issued by the Fund, if any, will contain legends
concerning restrictions on transfer of the shares.
3. The purchase or redemption of shares can occur on any business
day, as defined in the Bylaws, subject to existing
limitations.
-6-
<PAGE>
4. The Bylaws can be amended, altered or repealed at any regular
or special meeting of the shareholders or directors; provided,
however, that bylaws adopted or amended by the Board of
Directors shall be subject to amendment or repeal by the
shareholders. Bylaws adopted by the shareholders, if the
adopting resolution shall so expressly state, may not be
amended or repealed by the Board of Directors.
A complete copy of the proposed Amended and Restated Certificate of
Incorporation and Bylaws will be available for your review at the Annual
Meeting, and the Fund's Board and outside counsel will be available to answer
any questions you may have. The Board recommends a vote in favor of this
proposal.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The firm of Price Waterhouse LLP served as independent auditors for the Fund for
the fiscal year ended December 31, 1995. The Board has appointed that firm to
continue in that same capacity for the fiscal year 1996, and recommends that a
resolution be presented to shareholders at the Annual Meeting to ratify their
appointment.
Representatives of Price Waterhouse LLP will attend the Annual Meeting. They
will have the opportunity to make a statement and respond to appropriate
questions from shareholders.
The Board recommends a vote in favor of this proposal.
OTHER MATTERS
The Board does not know of any matters that will be presented for action at the
Annual Meeting other than those described above and matters incident to the
conduct of the meeting. If, however, any other matters not presently known
should come before the Annual Meeting, it is intended that the shares
represented by the accompanying proxy will be voted on such matters in
accordance with the discretion of the holders of such proxy.
[96annual.doc/mifprox.txt]
-7-
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[proxy card]
