SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
PROFESSIONALLY MANAGED PORTFOLIOS
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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PROFESSIONALLY MANAGED PORTFOLIOS
RCB GROWTH AND INCOME FUND
RCB SMALL CAP FUND
11111 SANTA MONICA BOULEVARD
SUITE 1700
LOS ANGELES, CA 90025
NOTICE OF SPECIAL MEETING
TO BE HELD DECEMBER 21, 2000
To the shareholders of RCB Growth and Income Fund ("Growth and Income
Fund") and RCB Small Cap Fund ("Small Cap Fund") (collectively, the "Funds"),
each a series of Professionally Managed Portfolios (the "Trust"), for a Special
Meeting of the Funds to be held on December 21, 2000:
Notice is hereby given that a Special Meeting (the "Meeting") of
shareholders of the Funds, will be held on December 21, 2000, at 3.00 p.m.,
Pacific Standard Time, at the offices of the Funds, 11111 Santa Monica
Boulevard, Suite 1700, Los Angeles, CA 90025. At the Meeting, you and the other
shareholders of the Funds will be asked to consider and vote:
1. To approve a new investment advisory agreement by and between the
Trust and Reed, Conner & Birdwell, LLC ("RBC") pursuant to which
RCB will act as advisor with respect to the assets of the Funds,
to become effective upon the completion of the acquisition of
Reed, Conner & Birdwell, Inc. by City National Corporation.
2. To transact such other business as may properly come before the
Meeting or any adjournments thereof.
Shareholders of record at the close of business on October 31, 2000 are
entitled to notice of, and to vote at, the Meeting. Please read the accompanying
Proxy Statement. Regardless of whether you plan to attend the Meeting, PLEASE
COMPLETE, SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY CARD so that a quorum will
be present and a maximum number of shares may be voted. You may change your vote
at any time by notifying the undersigned or at the Meeting.
By Order of the Board of Trustees
Robin Berger, Secretary
Los Angeles, California
November 27, 2000
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PROFESSIONALLY MANAGED PORTFOLIOS
RCB GROWTH AND INCOME FUND
RCB SMALL CAP FUND
11111 SANTA MONICA BOULEVARD
SUITE 1700
LOS ANGELES, CA 90025
PROXY STATEMENT
To the shareholders of RCB Growth and Income Fund ("Growth and Income
Fund") and RCB Small Cap Fund ("Small Cap Fund") (collectively, the "Funds"),
each a series of Professionally Managed Portfolios (the "Trust"), an open-end
management investment company, for a Special Meeting of shareholders of the
Funds to be held on December 21, 2000.
This Proxy Statement is furnished by the Trust to the shareholders of
the Funds on behalf of the Trust's Board of Trustees in connection with the
Funds' solicitation of shareholders' proxies for use at a Special Meeting of
Shareholders of the Funds (the "Meeting") to be held on December 21, 2000 at
3:00 p.m., Pacific Standard Time, at the offices of the Funds, 11111 Santa
Monica Boulevard, Suite 1700, Los Angeles, CA 90025 for the purposes set forth
below and in the accompanying Notice of Special Meeting. The approximate mailing
date of this Proxy Statement is November 27, 2000. At the Meeting, the
shareholders of the Funds will be asked:
1. To approve a new investment advisory agreement by and between the
Trust and Reed, Conner & Birdwell, LLC. ("RCB") pursuant to which
RCB will act as advisor with respect to the assets of the Funds,
to become effective upon the completion of the acquisition of
Reed, Conner & Birdwell, Inc. by City National Corporation.
2. To transact such other business as may properly come before the
Meeting or any adjournments thereof.
Shareholders who execute proxies may revoke them at any time before
they are voted, either by writing to the Secretary of the Trust at the Funds'
address noted above or in person at the time of the Meeting.
The Trust will request broker-dealer firms, custodians, nominees and
fiduciaries to forward proxy materials to the beneficial owners of the shares of
the Funds held of record by such persons. The Advisor may reimburse such
broker-dealer firms, custodians, nominees and fiduciaries for their reasonable
expenses incurred in connection with such proxy solicitation. In addition to the
solicitation of proxies by mail, officers and employees of the Trust, without
additional compensation, may solicit proxies in person or by telephone. The
costs associated with such solicitation and the Meeting will be borne by Reed,
Conner & Birdwell, Inc. and not by the Funds or the Trust.
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If sufficient votes are not received by the date of the Meeting, a
person named as proxy may propose one or more adjournments of the Meeting for a
period or periods not more than 120 days in the aggregate to permit further
solicitation of proxies. The persons named as proxies will vote all proxies in
favor of adjournment that voted in favor of Proposal No. 1 (or abstained) and
vote against adjournment all proxies that voted against Proposal No. 1.
Shareholders of the Funds at the close of business on October 31, 2000
will be entitled to be present and vote at the Meeting. As of that date, there
were 166,823.612 shares of the Growth and Income Fund outstanding and entitled
to vote, representing total net assets of approximately $2,536,767, and
332,329.853 shares of the Small Cap Fund outstanding and entitled to vote,
representing total net assets of approximately $5,156,689.
To the knowledge of the Trust's management, before the close of
business on October 31, 2000, the officers and Trustees of the Trust owned, as a
group, less than 1% of the shares of either Fund.
To the knowledge of the Trust's management, before the close of
business on October 31, 2000, persons owning of record more than 5% of the
outstanding shares of the Growth and Income Fund were as follows:
NAME AND ADDRESS PERCENT OF THE FUND
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Donaldson Lufkin & Jenrette Securities Co. 22.11%
P.O. Box 2052
Jersey City, NJ 07303-9998
Sutro & Co, F/B/O 6.89%
International Soc. For Neurochemistry
Los Angeles, CA
2
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To the knowledge of the Trust's management, before the close of
business on October 31, 2000, persons owning of record more than 5% of the
outstanding shares of the Small Cap Fund were as follows:
NAME AND ADDRESS PERCENT OF THE FUND
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Donaldson Lufkin & Jenrette Securities Co. 7.21%
P.O. Box 2052
Jersey City, NJ 07303-9998
Reed, Conner & Birdwell Inc. 9.82%
Money Purchase Plan, F/B/O
Jeffrey Bronchick
1111 Santa Monica Boulevard
Los Angeles, CA 90025
Timothy J. Rohner 11.68%
7995 Paseo Esmerado
Carlsbad, CA 92009
Robert Saffer 7.60%
263 6th Avenue
Brooklyn, NY 11215
John B. Smith IRA 9.16%
277 Pembrook Drive
Yonkers, NY 10710
The Winner Living Trust 9.91%
1545 10th Street
Manhattan Beach, CA 90266
The Funds' current investment advisor is Reed, Conner & Birdwell, Inc.,
11111 Santa Monica Boulevard, Suite 1700, Los Angeles, CA 90025. The Funds'
distributor is First Fund Distributors, Inc., 4455 E. Camelback Road, Suite
261E, Phoenix, AZ 85018. The Funds' transfer and dividend disbursing agent is
American Data Services, Inc, P.O. Box 5536, Hauppauge, NY 11788-0132.
The persons named in the accompanying proxy will vote in each case as
directed in the proxy, but in the absence of such direction, they intend to vote
FOR Proposal No. 1 and may vote in their discretion with respect to other
matters not now known to the Board of Trustees that may be presented to the
Meeting.
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PROPOSAL NO. 1
APPROVAL OF ADVISORY AGREEMENT BY AND BETWEEN THE TRUST AND THE NEW ADVISOR
BACKGROUND
GENERAL. Reed, Conner & Birdwell, Inc. ("Current Advisor") is a
California corporation located at 11111 Santa Monica Boulevard, Suite 1700, Los
Angeles, CA 90025. The Current Advisor has acted as advisor with respect to the
assets of the Funds pursuant to an existing investment advisory agreement since
September 30, 1998.
On October 30, 2000, the Current Advisor agreed to be acquired by City
National Corporation, a Delaware corporation (the "Proposed Acquisition"). The
Current Advisor will be merged into a special purpose acquisition corporation
and then reformed on or before December 31, 2000 as a Delaware limited liability
company to be named "Reed, Conner & Birdwell, LLC" ("RCB" or "New Advisor"). The
New Advisor will be a subsidiary of City National Corporation ("CNC"). However,
the executive officers of the Current Advisor will continue to have a
substantial financial interest in the New Advisor. Key members of the Current
Advisor's management team will have similar roles with the New Advisor where
they will be responsible for managing the day- to-day operations of RCB and the
Funds.
The Meeting has been called for the purpose of considering a new
advisory agreement for the Funds as a result of the Proposed Acquisition. The
Proposed Acquisition represents an ownership change of the Current Advisor and,
as such, has the effect of terminating the existing Advisory Agreement with
respect to the Funds. Accordingly, shareholders of the Funds are being asked to
approve a new Advisory Agreement (the "New Advisory Agreement") with respect to
the Funds. The New Advisory Agreement embodies substantially the same terms and
fees with the Current Advisor, differing only in the effective and termination
dates and minor updating changes.
The Trust's Board of Trustees at a meeting held on November 6, 2000, approved
the submission of the New Advisory Agreement to shareholders for shareholder
approval.
EXISTING ADVISORY AGREEMENT
The Current Advisor serves as the advisor for the Funds under an
Advisory Agreement (the "Existing Advisory Agreement") dated September 1, 1998.
The Existing Advisory Agreement provides for its automatic termination in the
event of a legal assignment. A change in ownership of the Current Advisor would,
therefore, terminate the Existing Advisory Agreement. The Board of Trustees of
the Trust, including a majority of the "non-interested" Trustees, most recently
approved continuation of the Existing Advisory Agreement for an additional
one-year period on August 23, 2000. Under the Existing Advisory Agreement, the
Current Advisor is entitled to receive from the Growth and Income Fund an annual
fee of 0.60% of that Fund's average daily net assets, and the Small Cap Fund an
annual fee of 0.85% of that Fund's average daily net assets.
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NEW ADVISORY AGREEMENT
Except for different effective and termination dates and minor updating
changes, the terms of the New Advisory Agreement are identical in all respects
to the terms of the Existing Advisory Agreement. A form of the New Advisory
Agreement is attached to this Proxy Statement as EXHIBIT A and the description
set forth in this Proxy Statement of the New Advisory Agreement is qualified in
its entirety by reference to EXHIBIT A.
Under the New Advisory Agreement, the New Advisor will provide
investment advisory services to the Funds, including deciding what securities
will be purchased and sold by the Funds, when such purchases and sales are to be
made, and arranging for such purchases and sales, all in accordance with the
provisions of the Investment Company Act of 1940, as amended (the "Investment
Company Act"), and any rules or regulations thereunder; any other applicable
provisions of law; the provisions of the Agreement and Declaration of Trust and
By-Laws of the Trust as amended from time to time; any policies and
determinations of the Board of Trustees; and the fundamental policies of the
Trust relating to the Funds, as reflected in the Trust's Registration
Statement under the Investment Company Act (including by reference, the Funds'
Statement of Additional Information) as such Registration Statement is amended
from time to time.
As compensation for its services to the Funds under the New Advisory
Agreement, the New Advisor will be entitled to receive from the Funds fees
calculated at the same rate as those charged under the Existing Advisory
Agreement described above, i.e., an annual fee of 0.60% of the Growth and Income
Fund's average daily net assets and an annual fee of 0.85% of the Small Cap
Fund's average daily net assets.
The New Advisory Agreement will continue in effect for a period not to
exceed two years from its effective date, and will continue in effect thereafter
for successive annual periods, provided its continuance is specifically approved
at least annually by (1) a majority vote, cast in person at a meeting called for
that purpose, of the Trust's Board of Trustees or (2) a vote of the holders of a
majority of the outstanding voting securities (as defined in the Investment
Company Act) of the Fund to which the New Advisory Agreement applies, and (3) in
either event by a majority of the Trustees who are not parties to the New
Advisory Agreement or interested persons of the Trust or of any such party (the
"Disinterested Trustees").
The New Advisory Agreement generally provides that it may be terminated
by the Trust or the New Advisor at any time, without penalty, by giving the
other party 60 days' written notice.
The New Advisor will continue to provide, at its expense, office space,
facilities and equipment for carrying out its duties under the New Advisory
Agreement. All other expenses incurred in the operation of the Funds are borne
by the Funds. Fund expenses include legal and auditing fees, fees and expenses
of the New Advisor, their custodian, accounting services and third-party
shareholder servicing agents, Trustees' fees, the cost of communicating with
shareholders and registration fees, as well as its other operating expenses.
5
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The New Advisory Agreement provides that the New Advisor shall not be
liable for any loss sustained by reason of the purchase, sale or retention of
any security whether the purchase, sale or retention has been based on its own
investigation and research or upon investigation and research made by any other
individual, firm or corporation, if the purchase, sale or retention has been
made and the other individual, firm or corporation has been selected in good
faith. The New Advisory Agreement, however, provides that nothing contained in
the New Advisory Agreement shall be construed to protect the New Advisor against
any liability to the Trust or its security holders by reason of willful
misfeasance, bad faith, or gross negligence in the performance of its duties, or
by reason of its reckless disregard of obligations and duties under the New
Advisory Agreement. Additionally, the New Advisory Agreement provides that the
federal securities laws impose liabilities under certain circumstances on
persons who act in good faith, and therefore nothing in the New Advisory
Agreement shall in any way constitute a waiver or limitation of any rights which
the Funds' shareholders may have under any federal securities laws. The New
Advisory Agreement provides that the New Advisor shall follow the principles set
forth in any investment advisory agreement in effect between the Trust and the
New Advisor in connection with its duties to invest the Funds' assets. The New
Advisory Agreement provides that the Trust may indemnify the New Advisor to the
full extent permitted by the Trust's Declaration of Trust and applicable law.
LEGAL REQUIREMENTS UNDER THE INVESTMENT COMPANY ACT
Section 15(f) of the Investment Company Act provides that, when a
change in control of an investment advisor occurs, the investment advisor or any
of its affiliated persons may receive any amount or benefit in connection with
the change in control as long as two conditions are satisfied.
The first condition specifies that no "unfair burden" may be imposed on the
investment company as a result of the transaction relating to the change of
control, or any express or implied terms, conditions or understandings. The term
"unfair burden," as defined in the Investment Company Act, includes any
arrangement during the two-year period after the change in control whereby the
investment advisor (or predecessor or successor advisor), or any interested
person of any such advisor, receives or is entitled to receive any compensation,
directly or indirectly, from the investment company or its security holders
(other than fees for bona fide investment advisory or other services) or from
any person in connection with the purchase or sale of securities or other
property to, from, or on behalf of the investment company (other than fees for
bona fide principal underwriting services). No such compensation arrangements
are contemplated in the Proposed Acquisition. The Current Advisor has agreed to
use its best efforts to ensure that the Proposed Acquisition will not cause the
imposition of an unfair burden, as that term is defined in Secti of the
Investment Company Act, on the Funds.
The second condition specifies that, during the three-year period
immediately following consummation of the transaction, at least 75% of the
investment company's board of directors must not be "interested persons" of the
investment advisor or predecessor investment advisor within the meaning of the
Investment Company Act ("Disinterested Trustees"). Currently, the Board of
Trustees of the Trust meets this 75% requirement.
6
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The Current Advisor has represented that the Proposed Acquisition will
be completed on or before December 31, 2000. In addition, the Board of Trustees
of the Trust approved the New Advisory Agreement at a meeting held on November
6, 2000.
If the Proposed Acquisition is not ultimately consummated, the Existing
Advisory Agreement will continue and remain in effect. However, if the Proposed
Acquisition is consummated but the New Advisory Agreement is not approved by the
Funds' shareholders, the Trustees will promptly seek to enter into a new
advisory arrangement for the Funds, subject to approval by the Funds'
shareholders.
For the fiscal year ended June 30, 2000, the Growth and Income Fund
accrued advisory fees of $11,420 under the Existing Advisory Agreement, all of
which were waived by the Current Advisor. For the same period, the Current
Advisor reimbursed the Fund an additional $66,391 in expenses.
For the fiscal year ended June 30, 2000, the Small Cap Fund accrued
advisory fees of $33,384 under the Existing Advisory Agreement, all of which
were waived by the Current Advisor. For the same period, the Current Advisor
reimbursed the Fund an additional $45,525 in expenses.
TRUSTEES' CONSIDERATION
The New Advisory Agreement was approved by the Board of Trustees of the
Trust, including a majority of the Disinterested Trustees, at a meeting held on
November 6, 2000.
The Board of Trustees of the Trust was presented with information
demonstrating that the terms of the New Advisory Agreement are fair to, and in
the best interests of, the Trust, the Funds and the shareholders of the Funds.
In considering the New Advisory Agreement, the Trustees had before them
information to evaluate the experience of the New Advisor's key personnel in
portfolio management, the quality of services the New Advisor is expected to
provide to the Funds, and the compensation proposed to be paid to the New
Advisor. The Trustees gave equal consideration to all factors deemed to be
relevant to the Funds, including, but not limited to the following: (1) the
quality of services provided to the Funds since the Funds' commencement of
operations; (2) the performance of the Funds since commencement of operations;
(3) the research-intensive nature and quality of the services expected to be
rendered to the Funds by the New Advisor; (4) the fact that the Proposed
Acquisition is not expected to affect the manner in which the New Advisor
advises the Funds; (5) the compensation payable to the New Advisor by the Funds
under the proposed New Advisory Agreement, which will be at the same rates as
the compensation now payable by the Funds to the Current Advisor under the
Existing Advisory Agreement; (6) the terms of the Existing Advisory Agreement,
which will be unchanged under the New Advisory Agreement except for different
effective and termination dates and minor updating changes; (7) the favorable
history, reputation, qualification and background of the Current Advisor, as
well as the qualifications of their personnel and financial condition; (8) the
Current Advisor's favorable overall investment performance record; and (9) other
factors deemed relevant.
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The Current Advisor has advised the Board of Trustees that it expects
that there will be no diminution in the scope and quality of advisory services
provided to the Funds as a result of the Proposed Acquisition.
Along with the approval of the Board of Trustees of the Trust, the
affirmative vote of the holders of a majority of the outstanding shares of the
Fund to which the Agreement applies is required for the New Advisory Agreement
with respect to that Fund to become effective. "Majority" for this purpose under
the Investment Company Act means the lesser of (i) 67% of the voting securities
present at the meeting if more than 50% of the outstanding voting securities are
present, or (ii) shares representing more than 50% of the outstanding shares.
All properly executed proxies received prior to the Meeting will be voted at the
Meeting in accordance with the instructions marked thereon. Proxies received
prior to the Meeting on which no vote is indicated will be voted "for" each
proposal as to which it is entitled to vote. Abstentions and broker non-votes
(i.e., proxies from brokers or nominees indicating that such persons have 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 nominees do
not have discretionary power) are considered present, but they are disregarded
in calculating the percentages of votes cast in favor of or against a proposal
by those "voting securities present" when the voting requirement is based on
achieving a percentage of the voting securities present in person or by proxy at
the Meeting. 40% of the outstanding shares entitled to vote on a proposal must
be present in person or by proxy to have a quorum to conduct business at the
Meeting. Abstentions and broker non-votes will count as votes present at the
Meeting for quorum purposes.
If, by the time scheduled for the Meeting, a quorum of shareholders of
a Fund is not present or if a quorum is present but sufficient votes "for" the
proposal have not been received, the persons named as proxies may propose one or
more adjustments of the Meeting for a period or periods of not more than 120
days in the aggregate to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of the votes cast on
the question in person or by proxy at the session of the Meeting to be
adjourned. The persons named as proxies will vote all proxies in favor of
adjournment that voted in favor of the proposal or that abstained. They will
vote against such adjournment those proxies required to be voted against the
proposal. Broker non-votes will be disregarded in the vote for adjournment.
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ADDITIONAL INFORMATION ON THE TRUST AND THE ADVISORS
The following is a list of the executive officers and Trustees of the
Trust, their positions with the Trust, and their positions with the Advisor, if
any:
Position With
Name Position With Trust Advisor
---- ------------------- -------
Steven J. Paggioli* President and Trustee None
Dorothy A. Berry Chairman and Trustee None
Wallace L. Cook Trustee None
Carl A. Froebel Trustee None
Rowley W.P. Redington Trustee None
Robert H. Wadsworth Vice President None
Robert M. Slotky Treasurer None
Robin Berger Secretary None
--------------------
* Steven J. Paggioli is an interested Trustee with respect to the Trust only.
With the exception of transactions which are not related to the business or
operation of the Trust and to which the Trust is not a party, no Trustee of the
Trust has had any direct or indirect interest in any transaction with the
Advisor or any parent or subsidiary of the Advisor. In addition, no Trustee has
had such an interest in any proposed transaction with any of the above entities.
The address of both the Current Advisor and the New Advisor is 11111
Santa Monica Boulevard, Suite 1700, Los Angeles, California 90025. The names of
the principal executive officers of the Current Advisor are set forth below. The
address for each, as it relates to his duties with the Current Advisor, is the
same as that of the Current Advisor.
Name Position With Current Advisor
---- -----------------------------
Donn B. Conner Principal and President
Jeffrey Bronchick Executive Vice President, Principal
and Chief Investment Officer
James C. Reed Executive Vice President
James P. Birdwell Executive Vice President
The New Advisor will be managed by a Management Board which will
consist of five individuals, two of whom will be designated by the Current
Advisor and three of whom will be designated by CNC. The address for CNC is City
National Center, 400 North Roxbury Drive, Beverly Hills, California 90210. The
two individuals designated by the Current Advisor are set forth below and the
address of each, as it relates to his duties with the New Advisor, is the same
as that of the New Advisor. The three additional managers to be designated by
CNC have not yet been selected.
Name Position With New Advisor
---- -------------------------
Donn B. Conner President and Chief Executive Officer
Jeffrey Bronchick Executive Vice President and Chief
Investment Officer
9
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GENERAL INFORMATION
OTHER MATTERS TO COME BEFORE THE MEETING
The Trust's management does not know of any matters to be presented at
the Meeting other than those described in this Proxy Statement. If other
business should properly come before the Meeting, the proxy holders will vote
thereon in accordance with their best judgment.
SHAREHOLDER PROPOSALS
The Meeting is a special meeting of shareholders. The Trust is not
required to, nor does it intend to, hold regular annual meetings of its
shareholders. If such an annual meeting is called, any shareholder who wishes to
submit a proposal for consideration at the meeting should submit the proposal or
notice of the proposal, if the shareholder chooses not to include the proposal
in the Trust's proxy materials, to the Trust within a reasonable time prior to
the Trust printing and mailing its proxy materials in accordance with,
respectively, Rule 14a-8 or Rule 14a-4(c) under the Securities Exchange Act of
1934.
REPORTS TO SHAREHOLDERS
The Funds will furnish on request, without charge, a copy of the most
recent Annual Report to Shareholders of the Funds. Requests for such reports
should be directed to Reed, Conner & Birdwell, Inc., 11111 Santa Monica
Boulevard, Suite 1700, Los Angeles, CA 90025 or by calling 1-877-478-4RCB
(4722).
IN ORDER THAT THE PRESENCE OF A QUORUM AT THE MEETING MAY BE ASSURED, PROMPT
EXECUTION AND RETURN OF THE ENCLOSED PROXY IS REQUESTED. A SELF-ADDRESSED,
POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
Robin Berger, Secretary
Los Angeles, California
November 27, 2000
10
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EXHIBIT A
FORM OF NEW ADVISORY AGREEMENT.
PROFESSIONALLY MANAGED PORTFOLIOS
INVESTMENT ADVISORY AGREEMENT
RCB Growth and Income Fund
RCB Small Cap Fund
THIS INVESTMENT ADVISORY AGREEMENT is made as of the _______________
day of _______________, 2000, by and between PROFESSIONALLY MANAGED PORTFOLIOS,
a Massachusetts business trust (hereinafter called the "Trust"), on behalf of
the following series of the Trust, the RCB Growth and Income Fund and RCB Small
Cap Fund (each a "Fund") and REED, CONNER & BIRDWELL, LLC, a Delaware limited
liability company (hereinafter called the "Advisor").
WITNESSETH:
WHEREAS, the Trust is an open-end management investment company,
registered as such under the Investment Company Act of 1940, as amended (the
"Investment Company Act"); and
WHEREAS, each Fund is a series of the Trust having separate assets and
liabilities; and
WHEREAS, the Advisor is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended, and is engaged in the business of
supplying investment advice as an independent contractor; and
WHEREAS, the Trust desires to retain the Advisor to render advice and
services to each Fund pursuant to the terms and provisions of this Agreement,
and the Advisor desires to furnish said
advice and services;
NOW, THEREFORE, in consideration of the covenants and the mutual
promises hereinafter contained and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties to this Agreement,
intending to be legally bound hereby, mutually agree as follows:
1. Appointment of Advisor. The Trust hereby employs the Advisor and the
Advisor hereby accepts such employment, to render investment advice and related
services with respect to the assets of each Fund for the period and on the terms
set forth in this Agreement, subject to the supervision and direction of the
Trust's Board of Trustees.
2. Duties of Advisor.
(a) General Duties. The Advisor shall act as investment
adviser to each Fund and shall supervise investments of each Fund on behalf of
A-1
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each Fund in accordance with the investment objectives, policies and
restrictions of each Fund as set forth in each Fund's and Trust's governing
documents, including, without limitation, the Trust's Agreement and Declaration
of Trust and By-Laws; each Fund's prospectus, statement of additional
information and undertakings; and such other limitations, policies and
procedures as the Trustees may impose from time to time in writing to the
Advisor. In providing such services, the Advisor shall at all times adhere to
the provisions and restrictions contained in the federal securities laws,
applicable state securities laws, the Internal Revenue Code, the Uniform
Commercial Code and other applicable law.
Without limiting the generality of the foregoing, the Advisor shall:
(i) furnish each Fund with advice and recommendations with respect to the
investment of each Fund's assets and the purchase and sale of portfolio
securities for each Fund, including the taking of such steps as may be necessary
to implement such advice and recommendations (i.e., placing the orders); (ii)
manage and oversee the investments of each Fund, subject to the ultimate
supervision and direction of the Trust's Board of Trustees; (iii) vote proxies
for each Fund, file ownership reports under Section 13 of the Securities
Exchange Act of 1934 for each Fund, and take other actions on behalf of each
Fund; (iv) maintain the books and records required to be maintained by each Fund
except to the extent arrangements have been made for such books and records to
be maintained by the administrator or another agent of each Fund; (v) furnish
reports, statements and other data on securities, economic conditions and other
matters related to the investment of each Fund's assets which each Fund's
administrator or distributor or the officers of the Trust may reasonably
request; and (vi) render to the Trust's Board of Trustees such periodic and
special reports with respect to each Fund's investment activities as the Board
may reasonably request, including at least one in-person appearance annually
before the Board of Trustees.
(b) Brokerage. The Advisor shall be responsible for decisions
to buy and sell securities for each Fund, for broker-dealer selection, and for
negotiation of brokerage commission rates, provided that the Advisor shall not
direct an order to an affiliated person of the Advisor without general prior
authorization to use such affiliated broker or dealer from the Trust's Board of
Trustees. The Advisor's primary consideration in effecting a securities
transaction will be execution at the most favorable price. In selecting a
broker-dealer to execute each particular transaction, the Advisor may take the
following into consideration: the best net price available; the reliability,
integrity and financial condition of the broker-dealer, the size of and
difficulty in executing the order; and the value of the expected contribution of
the broker-dealer to the investment performance of each Fund on a continuing
basis. The price to each Fund in any transaction may be less favorable than that
available from another broker-dealer if the difference is reasonably justified
by other aspects of the portfolio execution services offered.
Subject to such policies as the Board of Trustees of the Trust may
determine, the Advisor shall not be deemed to have acted unlawfully or to have
breached any duty created by this Agreement or otherwise solely by reason of its
having caused each Fund to pay a broker or dealer that provides (directly or
indirectly) brokerage or research services to the Advisor an amount of
commission for effecting a portfolio transaction in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction, if the Advisor determines in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
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particular transaction or the Advisor's overall responsibilities with respect to
the Trust. The Advisor is further authorized to allocate the orders placed by it
on behalf of each Fund to such brokers or dealers who also provide research or
statistical material, or other services, to the Trust, the Advisor, or any
affiliate of either. Such allocation shall be in such amounts and proportions as
the Advisor shall determine, and the Advisor shall report on such allocations
regularly to the Trust, indicating the broker-dealers to whom such allocations
have been made and the basis therefor. The Advisor is also authorized to
consider sales of shares as a factor in the selection of brokers or dealers to
execute portfolio transactions, subject to the requirements of best execution,
i.e., that such brokers or dealers are able to execute the order promptly and at
the best obtainable securities price.
On occasions when the Advisor deems the purchase or sale of a security
to be in the best interest of one or more of each Fund as well as of other
clients, the Advisor, to the extent permitted by applicable laws and
regulations, may aggregate the securities to be so purchased or sold in order to
obtain the most favorable price or lower brokerage commissions and the most
efficient execution. In such event, allocation of the securities so purchased or
sold, as well as the expenses incurred in the transaction, will be made by the
Advisor in the manner it considers to be the most equitable and consistent with
its fiduciary obligations to each Fund and to such other clients.
3. Representations of the Advisor.
(a) The Advisor shall use its best judgment and efforts in rendering
the advice and services to each Fund as contemplated by this Agreement.
(b) The Advisor shall maintain all licenses and registrations necessary
to perform its duties hereunder in good order.
(c) The Advisor shall conduct its operations at all times in
conformance with the Investment Advisers Act of 1940, the Investment Company
Act, and any other applicable state and/or self-regulatory organization
regulations.
(d) The Advisor shall maintain errors and omissions insurance in an
amount at least equal to that disclosed to the Board of Trustees in connection
with their approval of this Agreement.
4. Independent Contractor. The Advisor shall, for all purposes herein,
be deemed to be an independent contractor, and shall, unless otherwise expressly
provided and authorized to do so, have no authority to act for or represent the
Trust or each Fund in any way, or in any way be deemed an agent for the Trust or
for each Fund. It is expressly understood and agreed that the services to be
rendered by the Advisor to each Fund under the provisions of this Agreement are
not to be deemed exclusive, and the Advisor shall be free to render similar or
different services to others so long as its ability to render the services
provided for in this Agreement shall not be impaired thereby.
5. Advisor's Personnel. The Advisor shall, at its own expense, maintain
such staff and employ or retain such personnel and consult with such other
persons as it shall from time to time determine to be necessary to the
performance of its obligations under this Agreement. Without limiting the
generality of the foregoing, the staff and personnel of the Advisor shall be
deemed to include persons employed or retained by the Advisor to furnish
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statistical information, research, and other factual information, advice
regarding economic factors and trends, information with respect to technical and
scientific developments, and such other information, advice and assistance as
the Advisor or the Trust's Board of Trustees may desire and reasonably request.
6. Expenses.
(a) With respect to the operation of each Fund, the Advisor shall be
responsible for (i) providing the personnel, office space and equipment
reasonably necessary for the operation of each Fund, (ii) the expenses of
printing and distributing extra copies of each Fund's prospectus, statement of
additional information, and sales and advertising materials (but not the legal,
auditing or accounting fees attendant thereto) to prospective investors (but not
to existing shareholders), and (iii) the costs of any special Board of Trustees
meetings or shareholder meetings convened for the primary benefit of the
Advisor. If the Advisor has agreed to limit the operating expenses of each Fund,
the Advisor shall also be responsible on a monthly basis for any operating
expenses that exceed the agreed upon expense limit.
(b) Each Fund is responsible for and has assumed the obligation for
payment of all of its expenses, other than as stated in Subparagraph 6(a) above,
including but not limited to: fees and expenses incurred in connection with the
issuance, registration and transfer of its shares; brokerage and commission
expenses; all expenses of transfer, receipt, safekeeping, servicing and
accounting for the cash, securities and other property of the Trust for the
benefit of each Fund including all fees and expenses of its custodian,
shareholder services agent and accounting services agent; interest charges on
any borrowings; costs and expenses of pricing and calculating its daily net
asset value and of maintaining its books of account required under the
Investment Company Act; taxes, if any; a pro rata portion of expenditures in
connection with meetings of each Fund's shareholders and the Trust's Board of
Trustees that are properly payable by each Fund; salaries and expenses of
officers and fees and expenses of members of the Trust's Board of Trustees or
members of any advisory board or committee who are not members of, affiliated
with or interested persons of the Advisor; insurance premiums on property or
personnel of each Fund which inure to its benefit, including liability and
fidelity bond insurance; the cost of preparing and printing reports, proxy
statements, prospectuses and statements of additional information of each Fund
or other communications for distribution to existing shareholders; legal,
auditing and accounting fees; trade association dues; fees and expenses
(including legal fees) of registering and maintaining registration of its shares
for sale under federal and applicable state and foreign securities laws; all
expenses of maintaining and servicing shareholder accounts, including all
charges for transfer, shareholder record keeping, dividend disbursing,
redemption, and other agents for the benefit of each Fund, if any; and all other
charges and costs of its operation plus any extraordinary and non-recurring
expenses, except as herein otherwise prescribed.
(c) The Advisor may voluntarily absorb certain Fund expenses or waive
the Advisor's own advisory fee.
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(d) To the extent the Advisor incurs any costs by assuming expenses
which are an obligation of each Fund as set forth herein, the Fund shall
promptly reimburse the Advisor for such costs and expenses, except to the extent
the Advisor has otherwise agreed to bear such expenses. To the extent the
services for which a Fund is obligated to pay are performed by the Advisor, the
Advisor shall be entitled to recover from such Fund to the extent of the
Advisor's actual costs for providing such services. In determining the Advisor's
actual costs, the Advisor may take into account an allocated portion of the
salaries and overhead of personnel performing such services.
7. Investment Advisory and Management Fee.
(a) Each Fund shall pay to the Advisor, and the Advisor agrees to
accept, as full compensation for all investment management and advisory services
furnished or provided to each Fund pursuant to this Agreement, an annual
management fee equal to 0.60% of the RCB Growth and Income Fund's and 0.85% of
the RCB Small Cap Fund's daily net assets, computed on the value of the net
assets of each Fund as of the close of business each day.
(b) The management fee shall be accrued daily by each Fund and paid to
the Advisor on the first business day of the succeeding month.
(c) The initial fee under this Agreement shall be payable on the first
business day of the first month following the effective date of this Agreement
and shall be prorated as set forth below. If this Agreement is terminated prior
to the end of any month, the fee to the Advisor shall be prorated for the
portion of any month in which this Agreement is in effect which is not a
complete month according to the proportion which the number of calendar days in
the month during which the Agreement is in effect bears to the number of
calendar days in the month, and shall be payable within ten (10) days after the
date of termination.
(d) The fee payable to the Advisor under this Agreement will be reduced
to the extent of any receivable owed by the Advisor to each Fund and as required
under any expense limitation applicable to each Fund.
(e) The Advisor voluntarily may reduce any portion of the compensation
or reimbursement of expenses due to it pursuant to this Agreement and may agree
to make payments to limit the expenses which are the responsibility of a Fund
under this Agreement. Any such reduction or payment shall be applicable only to
such specific reduction or payment and shall not constitute an agreement to
reduce any future compensation or reimbursement due to the Advisor hereunder or
to continue future payments. Any such reduction will be agreed to prior to
accrual of the related expense or fee and will be estimated daily and reconciled
and paid on a monthly basis.
(f) Any fee withheld or voluntarily reduced and any Fund expense
absorbed by the Advisor voluntarily or pursuant to an agreed upon expense cap
shall be reimbursed by each Fund to the Advisor, if so requested by the Advisor,
in the first, second or third (or any combination thereof) fiscal year next
succeeding the fiscal year of the withholding, reduction or absorption if the
aggregate amount actually paid by each Fund toward the operating expenses for
such fiscal year (taking into account the reimbursement) do not exceed the
applicable limitation on Fund expenses. Such reimbursement may be paid prior to
each Fund's payment of current expenses if so requested by the Advisor even if
such practice may require the Advisor to waive, reduce or absorb current Fund
expenses.
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(g) The Advisor may agree not to require payment of any portion of the
compensation or reimbursement of expenses otherwise due to it pursuant to this
Agreement. Any such agreement shall be applicable only with respect to the
specific items covered thereby and shall not constitute an agreement not to
require payment of any future compensation or reimbursement due to the Advisor
hereunder.
8. No Shorting; No Borrowing. The Advisor agrees that neither it nor
any of its officers or employees shall take any short position in the shares of
each Fund. This prohibition shall not prevent the purchase of such shares by any
of the officers or employees of the Advisor or any trust, pension,
profit-sharing or other benefit plan for such persons or affiliates thereof, at
a price not less than the net asset value thereof at the time of purchase, as
allowed pursuant to rules promulgated under the Investment Company Act. The
Advisor agrees that neither it nor any of its officers or employees shall borrow
from each Fund or pledge or use each Fund's assets in connection with any
borrowing not directly for each Fund's benefit. For this purpose, failure to pay
any amount due and payable to each Fund for a period of more than thirty (30)
days shall constitute a borrowing.
9. Conflicts with Trust's Governing Documents and Applicable Laws.
Nothing herein contained shall be deemed to require the Trust or each Fund to
take any action contrary to the Trust's Agreement and Declaration of Trust,
By-Laws, or any applicable statute or regulation, or to relieve or deprive the
Board of Trustees of the Trust of its responsibility for and control of the
conduct of the affairs of the Trust and Fund. In this connection, the Advisor
acknowledges that the Trustees retain ultimate plenary authority over each Fund
and may take any and all actions necessary and reasonable to protect the
interests of shareholders.
10. Reports and Access. The Advisor agrees to supply such information
to each Fund's administrator and to permit such compliance inspections by each
Fund's administrator as shall be reasonably necessary to permit the
administrator to satisfy its obligations and respond to the reasonable requests
of the Trustees.
11. Advisor's Liabilities and Indemnification.
(a) The Advisor shall have responsibility for the accuracy and
completeness (and liability for the lack thereof) of the statements in each
Fund's offering materials (including the prospectus, the statement of additional
information, advertising and sales materials), except for information supplied
by the administrator or the Trust or another third party for inclusion therein.
(b) In the absence of willful misfeasance, bad faith, gross negligence,
or reckless disregard of the obligations or duties hereunder on the part of the
Advisor, the Advisor shall not be subject to liability to the Trust or each Fund
or to any shareholder of each Fund for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security by each Fund.
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(c) Each party to this Agreement shall indemnify and hold harmless the
other party and the shareholders, directors or trustees, officers and employees
of the other party (any such person, an "Indemnified Party") against any loss,
liability, claim, damage or expense (including the reasonable cost of
investigating and defending any alleged loss, liability, claim, damage or
expenses and reasonable counsel fees incurred in connection therewith) arising
out of the Indemnified Party's performance or non-performance of any duties
under this Agreement provided, however, that nothing herein shall be deemed to
protect any Indemnified Party against any liability to which such Indemnified
Party would otherwise be subject by reason of willful misfeasance, bad faith or
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties under this Agreement.
(d) No provision of this Agreement shall be construed to protect any
Trustee or officer of the Trust, or officer of the Advisor, from liability in
violation of Sections 17(h) and (i) of the Investment Company Act.
12. Non-Exclusivity; Trading for Advisor's Own Account. The Trust's
employment of the Advisor is not an exclusive arrangement. The Trust may from
time to time employ other individuals or entities to furnish it with the
services provided for herein. Likewise, the Advisor may act as investment
adviser for any other person, and shall not in any way be limited or restricted
from buying, selling or trading any securities for its or their own accounts or
the accounts of others for whom it or they may be acting, provided, however,
that the Advisor expressly represents that it will undertake no activities which
will adversely affect the performance of its obligations to each Fund under this
Agreement; and provided further that the Advisor will adhere to a code of ethics
governing employee trading and trading for proprietary accounts that conforms to
the requirements of the Investment Company Act and the Investment Advisers Act
of 1940 and has been approved by the Trust's Board of Trustees.
13. Term.
(a) This Agreement shall go into effect on the date set forth above and
shall, unless terminated as hereinafter provided, remain in effect for a period
of two (2) years, unless sooner terminated as hereinafter provided. This
Agreement shall continue in effect thereafter for additional periods not
exceeding one (1) year so long as such continuation is approved for each Fund at
least annually by (i) the Board of Trustees of the Trust or by the vote of a
majority of the outstanding voting securities of each Fund and (ii) the vote of
a majority of the Trustees of the Trust who are not parties to this Agreement
nor interested persons thereof, cast in person at a meeting called for the
purpose of voting on such approval. The terms "majority of the outstanding
voting securities" and "interested persons" shall have the meanings as set forth
in the Investment Company Act.
(b) Each Fund may use the name "RCB" or any name derived from or using
the name "Reed, Conner & Birdwell" only for so long as this Agreement or any
extension, renewal or amendment hereof remains in effect. Within sixty (60) days
from such time as this Agreement shall no longer be in effect, each Fund shall
cease to use such a name or any other name connected with the Advisor.
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14. Termination; No Assignment.
(a) This Agreement may be terminated by the Trust on behalf of each
Fund at any time, without payment of any penalty, by the Board of Trustees of
the Trust or by vote of a majority of the outstanding voting securities of each
Fund, upon sixty (60) days' written notice to the Advisor, and by the Advisor
upon sixty (60) days' written notice to each Fund. In the event of a
termination, the Advisor shall cooperate in the orderly transfer of each Fund's
affairs and, at the request of the Board of Trustees, transfer any and all books
and records of each Fund maintained by the Advisor on behalf of each Fund.
(b) This Agreement shall terminate automatically in the event of any
transfer or assignment thereof, as defined in the Investment Company Act.
15. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision, statute or rule, or shall be otherwise
rendered invalid, the remainder of this Agreement shall not be affected thereby.
16. Notice of Declaration of Trust. The Advisor agrees that the Trust's
obligations under this Agreement shall be limited to each Fund and to its
assets, and that the Advisor shall not seek satisfaction of any such obligation
from the shareholders of each Fund nor from any trustee, officer, employee or
agent of the Trust or each Fund.
17. Captions. The captions in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect.
18. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws principles thereof; provided that nothing herein shall be
construed to preempt, or to be inconsistent with, any federal law, regulation or
rule, including the Investment Company Act and the Investment Advisers Act of
1940 and any rules and regulations promulgated thereunder.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers, all on the day and year first
above written.
PROFESSIONALLY MANAGED PORTFOLIOS REED, CONNER & BIRDWELL, LLC
on behalf of the RCB Growth and
Income Fund and RCB Small Cap Fund
By:_______________________________ By:_______________________________
Name:_____________________________ Name:_____________________________
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PROXY
RCB GROWTH AND INCOME FUND
SPECIAL MEETING OF SHAREHOLDERS
DECEMBER 21, 2000
SOLICITED ON BEHALF OF THE
BOARD OF TRUSTEES OF
PROFESSIONALLY MANAGED PORTFOLIOS
The undersigned hereby appoints Jeffrey Bronchick, Daryl Weber and Robert M.
Slotky, and each of them, as proxies of the undersigned, each with the power to
appoint his substitute, for the Special Meeting of Shareholders of RCB Growth
and Income Fund (the "Fund"), a series of Professionally Managed Portfolios (the
"Trust"), to be held on December 21, 2000 at the offices of the Fund, 11111
Santa Monica Boulevard, Suite 1700, Los Angeles, CA 90025, or at any and all
adjournments thereof (the "Meeting"), to vote, as designated below, all shares
of the Fund, held by the undersigned at the close of business on October 31,
2000. Capitalized terms used without definition have the meanings given to them
in the accompanying Proxy Statement.
A SIGNED PROXY WILL BE VOTED IN FAVOR OF THE PROPOSAL LISTED BELOW UNLESS YOU
HAVE SPECIFIED OTHERWISE. PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY. YOU
MAY VOTE ONLY IF YOU HELD SHARES IN THE FUND AT THE CLOSE OF BUSINESS ON OCTOBER
31, 2000. YOUR SIGNATURE AUTHORIZES THE PROXIES TO VOTE IN THEIR DISCRETION UPON
SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING, INCLUDING WITHOUT
LIMITATION ALL MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
<PAGE>
Approval of a new advisory agreement by and between the Trust and Reed, Conner &
Birdwell, LLC ("RCB") pursuant to which RCB will act as advisor with respect to
the assets of the Fund, to become effective upon the completion of the
acquisition of Reed, Conner & Birdwell, Inc. by City National Corporation.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: ______________, 2000
__________________________________________
Signature
__________________________________________
Title (if applicable)
__________________________________________
Signature (if held jointly)
__________________________________________
Title (if applicable)
Please sign exactly as name or names appear on your shareholder account
statement. When signing as attorney, trustee, executor, administrator,
custodian, guardian or corporate officer, please give full title. If shares are
held jointly, each shareholder should sign.
<PAGE>
PROXY
RCB SMALL CAP FUND
SPECIAL MEETING OF SHAREHOLDERS
DECEMBER 21, 2000
SOLICITED ON BEHALF OF THE
BOARD OF TRUSTEES OF
PROFESSIONALLY MANAGED PORTFOLIOS
The undersigned hereby appoints Jeffrey Bronchick, Daryl Weber and Robert M.
Slotky, and each of them, as proxies of the undersigned, each with the power to
appoint his substitute, for the Special Meeting of Shareholders of RCB Small Cap
Fund (the "Fund"), a series of Professionally Managed Portfolios (the "Trust"),
to be held on December 21, 2000 at the offices of the Fund, 11111 Santa Monica
Boulevard, Suite 1700, Los Angeles, CA 90025, or at any and all adjournments
thereof (the "Meeting"), to vote, as designated below, all shares of the Fund,
held by the undersigned at the close of business on October 31, 2000.
Capitalized terms used without definition have the meanings given to them in the
accompanying Proxy Statement.
A SIGNED PROXY WILL BE VOTED IN FAVOR OF THE PROPOSAL LISTED BELOW UNLESS YOU
HAVE SPECIFIED OTHERWISE. PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY. YOU
MAY VOTE ONLY IF YOU HELD SHARES IN THE FUND AT THE CLOSE OF BUSINESS ON OCTOBER
31, 2000. YOUR SIGNATURE AUTHORIZES THE PROXIES TO VOTE IN THEIR DISCRETION UPON
SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING, INCLUDING WITHOUT
LIMITATION ALL MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
<PAGE>
Approval of a new advisory agreement by and between the Trust and Reed, Conner &
Birdwell, LLC ("RCB") pursuant to which RCB will act as advisor with respect to
the assets of the Fund, to become effective upon the completion of the
acquisition of Reed, Conner & Birdwell, Inc. by City National Corporation.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: ______________, 2000
__________________________________________
Signature
__________________________________________
Title (if applicable)
__________________________________________
Signature (if held jointly)
__________________________________________
Title (if applicable)
Please sign exactly as name or names appear on your shareholder account
statement. When signing as attorney, trustee, executor, administrator,
custodian, guardian or corporate officer, please give full title. If shares are
held jointly, each shareholder should sign.
