SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant
Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
ASM INDEX 30 FUND, INC.
(Name of Registrant as Specified In Its Charter)
(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:
2) Aggregate number of securities to which transaction
applies:
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):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/_/ Fee paid previously with preliminary material
/_/ 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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
PRELIMINARY COPY
ASM INDEX 30 FUND, INC.
15438 North Florida Avenue
Suite 107
Tampa, Florida 33613
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD OCTOBER 30, 1997
To the stockholders of ASM Index 30 Fund, Inc.:
Notice is hereby given that a special meeting in lieu of an annual
meeting of stockholders (the "Meeting") of the ASM Index 30 Fund, Inc.,
(the "Fund") will be held at the offices of the Fund, 15438 North
Florida Avenue, Suite 107, Tampa, Florida 33613, on Thursday,
October 30, 1997 at 9:00 a.m. Eastern Time for the following purposes:
1. To elect a Board of Directors of the Fund;
2. To ratify or reject the selection of Coopers & Lybrand LLP,
Certified Public Accountants, as independent auditors of the
Fund for the current fiscal year; and
3. To approve or disapprove a new Investment Management Agreement
between the Fund and Vector Index Advisors, Inc., as set forth
in Exhibit A and described under Proposal 2 of the attached
Proxy Statement;
4. To consider and act upon any other business (none known as of
the date of this Notice) which may legally come before the
Meeting or any adjournment thereof.
Pursuant to the Fund's Bylaws, the Board of Directors has fixed the
close of business on August 1, 1997 as the record date for the
determination of stockholders entitled to notice of and to vote at
the Meeting. Only stockholders of record at that time will be
entitled to vote at the Meeting or any adjournment thereof.
By Order of the Board of Directors
S. CASH ULMER
Secretary
Tampa, Florida
Dated: September ****, 1997
PLEASE RETURN YOUR PROXY CARD PROMPTLY
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Stockholders are cordially invited to attend the Meeting in person.
If you do not expect to attend the Meeting, please indicate your
voting instructions on the enclosed proxy card(s), date and sign
it, and return it in the envelope provided, which is addressed for
your convenience and needs no postage if mailed in the United
States. In order to avoid the additional expense of further
solicitation, we ask your cooperation in mailing in your proxy
promptly.
ASM INDEX 30 FUND, INC.
PROXY STATEMENT
Special Meeting of Stockholders
October 30, 1997
SOLICITATION, REVOCATION AND VOTING OF PROXIES
The enclosed proxy is solicited by and on behalf of the
Board of Directors of ASM Index 30 Fund, Inc. (the "Fund"). The
solicitation is being made in connection with a Special Meeting
of Stockholders (the "Meeting") of the Fund, to be held at the
offices of the Fund, 15438 North Florida Avenue, Tampa, Florida
33613, on October 30, 1997 at 9:00 a.m. Eastern Time, and at any and
all adjournments thereof. At the Meeting, the stockholders of
the Fund are being asked to vote on the items listed on the
Notice of Annual Meeting of Stockholders accompanying this proxy
statement.
You may revoke your proxy at any time before it is exercised
by delivering a written notice to the Fund expressly revoking
your proxy, by signing and forwarding to the Fund a later-dated
proxy, or by attending the Meeting and casting your votes in
person. The Fund will request broker-dealer firms, custodians,
nominees and fiduciaries to forward proxy material to the
beneficial owners of the shares of record held by such persons.
The Fund may reimburse such broker-dealer firms, custodians,
nominees and fiduciaries for their reasonable expenses incurred
in connection with such proxy solicitation. The cost of
soliciting these proxies and any resolicitations will be borne by
the Fund. In addition to solicitations by mail, some of the
officers and employees of the Fund or its investment adviser
without extra remuneration, may conduct additional solicitations
by telephone, telegraph, and personal interviews. The Fund or
its adviser may retain a firm to solicit proxies on behalf of the
Fund, the fee for which will be borne by the Fund, if such
solicitation is necessary to obtain a quorum or approve items one
or two, or by the adviser if such solicitation is for the purpose
of approving item three. It is expected that this proxy
statement will be first mailed to stockholders on or about
September ****, 1997.
A majority of the shares of the Fund entitled to vote at the
meeting constitutes a quorum for the transaction of business at
the Meeting. Shares represented in person or by proxy (including
shares which abstain or do not vote with respect to one or more
of the Proposals presented for stockholder approval) will be
counted for purposes of determining whether a quorum is present
at the Meeting. Election of Directors as described in Proposal 1
requires the approval of a plurality of votes cast at the
Meeting. Approval of Proposal 2 requires the approval of a
majority of the votes cast at the Meeting. Approval of Proposal
3 requires the affirmative vote of the holders of a "majority of
the outstanding voting securities" of the Fund. Under the
Investment Company Act of 1940, as amended (the "1940 Act"), this
means that to be approved, Proposal 3 must receive the
affirmative vote of the lesser of (i) 67% or more of the voting
securities of the Fund present at the Meeting, if the holders of
more than 50% of the outstanding shares of the Fund are present
in person or represented by proxy or (ii) more than 50% of the
outstanding voting securities of the Fund. Under Maryland law
and the 1940 Act, abstentions and broker non-votes will be
treated as votes not cast and, therefore, will not be counted for
purposes of determining whether matters to be voted upon at the
Meeting have been approved.
The proxyholders will vote as directed all proxies received
that are duly executed. It is the present intention that, absent
contrary instructions, proxies executed without instructions will
be voted: FOR the election as Directors of the Fund of the
nominees named hereinafter, but the proxyholders reserve full
discretion to cast votes for other persons selected by the
disinterested directors of the Fund in the event any nominee is
unable to serve; FOR the ratification of selection of Coopers &
Lybrand, LLP as independent auditors for the Fund for the current
fiscal year; FOR the approval of a new Investment Management
Agreement between the Fund and Vector Index Advisers, Inc.; and,
in the discretion of the proxyholders, upon such other business
not now known or determined as may legally come before the
Meeting.
VOTING RIGHTS
Only stockholders of record at the close of business on August
1, 1997 are entitled to vote at the Meeting or any adjournment
thereof. Stockholders are entitled to cast one vote for each
full share, and a fractional vote for each fractional share held
on the record date. All voting rights are non-cumulative. On
August 1, 1997, the number of shares of the Fund outstanding was
2,262,241.540.
INTRODUCTION
Under Maryland law and the 1940 Act, the Fund generally is
not required to hold an annual meeting. However, an annual
meeting of the Fund's stockholders has not been held since April
****, 1995. The Board of Directors of the Fund (the "Board") has
therefore determined that it is appropriate to hold the Meeting
to permit stockholders to vote on several matters, including the
re-election of the Board, the ratification of the appointment of
an independent accounting firm, and the approval of a new
advisory agreement. Each Proposal is discussed further in this
Proxy Statement. Under present expense limitation provisions in
effect for the Fund, the Board believes no Proposal will result
in any increase of expenses allocable to the current stockholders
of the Funds.
YOUR VOTE IS IMPORTANT.
PLEASE VOTE ON EACH PROPOSAL.
PLEASE RETURN YOUR PROXY CARDS PROMPTLY NO MATTER HOW MANY
SHARES YOU OWN.
If you hold shares in more than one account, and therefore
receive more than one proxy card, please return all cards you
receive.
PROPOSAL 1:
ELECTION OF DIRECTORS
The current Board of Directors consists of the five persons
nominated for election at this Meeting. The nominees include the
Fund's four current independent Directors. Each person elected
as Director will serve until the next meeting held for the
purpose of electing Directors and until his successor is elected
and qualified. All of the nominees have consented to serve as
Directors. However, if any nominee is not available for election
at the time of the Meeting, the proxyholders may vote for any
other person nominated by the current Directors, or may refrain
from electing or voting to elect anyone to fill the position.
The following table shows each nominee who is standing for
election and his age, principal occupation or employment during
the past five years and other directorships. The table also
shows the year in which the nominee was elected to the Board of
Directors of the Fund.
<TABLE>
<CAPTION>
Shares/Percentage
Beneficially
Name, Age and Five-Year Length of Owned as of
Business Experience Service August 1, 1997
<S> <C> <C>
STEVEN H. ADLER (59)<F1> Director 0
Director and President Since 1991
Chairman and President
Vector Index Advisors,
Inc. (1991-present).
JEROME P.
FELTENSTEIN (62) Director 3,952.98/0.175%
Director Since 1993
Chief Executive Officer,
Rain Men, USA, Inc.
(9/95-present); Chief
Executive Officer,
American Business
Associates (5/82-4/95).
W. KEITH SCHILIT (43) Director 0
Director Since 1993
Professor, University
of South Florida (1985-
present); Principal,
Catalyst Ventures
(1985-present); Director,
Dataflex (3/97-present).
DANIEL CALABRIA (61) Director 108.47%/.005%
Director Since 1996
Retired; private investor
consultant (2/95-present);
formerly Executive Vice
President, Wm. R. Hough
& Co. (6/93-1/95);
formerly President,
Templeton Funds
Management Corp. (6/86-
11/92); Trustee, The Idex
Mutual Funds (3/96-
present); Trustee, The
Florida Tax Free Funds
(12/93-present).
ARTHUR SALZFASS (62) Director 0
Director Since 1997
Consultant, Micro Info
(11/84-present);
President (nonsalaried),
Rutledge Books, Inc.
(5/97-present); Chief
Operating Officer, Honi-
corp, Inc. (10/94-6/95);
Chief Executive Officer
and President, U.S.
Fibercom, Inc. (10/93-
6/94); Director, SBM,
Inc. (6/92-Present).
<FN>
<F1> An "interested person" (as defined in the 1940 Act) of the
Fund.
</FN>
</TABLE>
Currently, the Funds pay independent Directors fees of
$1,000 per quarterly meeting, plus $500 for each special meeting
attended. During the fiscal year ended October 31, 1996, fees to
all Directors and reimbursements for expenses related to
attendance at Board meetings totalled $20,266. During the last
fiscal year, there were five meetings of the Board of Directors.
All of the Directors attended at least 75% of such meetings.
<TABLE>
<CAPTION> COMPENSATION TABLE
Pension Estimated
Aggregate or Retirement Annual
Compensation Benefits Accrued as Benefits
During Part of Fund Upon
Director Fiscal 1996 Expenses Retirement
<S> <C> <C> <C>
Steven H.
Adler none none none
Jerome P.
Feltenstein $6,500 none none
W. Keith
Schilit $6,500 none none
Daniel
Calabria $5,000 none none
Arthur
Salzfass N/A N/A N/A
</TABLE>
The Board has established one committee, an Audit Committee
consisting of those Directors who are not interested persons.
During fiscal 1996, the Audit Committee met one time, and all
members attended such meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THE ELECTION OF EACH NOMINEE FOR DIRECTOR.
* * * *
PROPOSAL 2:
RATIFICATION OF THE SELECTION OF AUDITORS
The Board has selected Coopers & Lybrand, LLP to serve as
independent accountants to audit the financial statements of the
Fund for the fiscal year ending October 31, 1997. Coopers &
Lybrand LLP has advised the Fund that neither it, nor any of its
members, has any other relationship with the Fund, and that none
of them has any direct or indirect financial interest in the
Fund. No representative of Coopers & Lybrand, LLP is expected to
be present at the Meeting.
This firm has acted as auditors for the Fund for the fiscal
year ended October 31, 1996. The selection of Coopers & Lybrand,
LLP was based upon the skill and expertise of that firm in the
specialized area of investment company accounting, reflected in
its national practice in this field. Pursuant to the terms of an
order of the U.S. Securities & Exchange Commission, the selection
of the accountants for the Fund is committed to the discretion of
the Directors who are not interested persons of the Fund or
Vector. Prior to fiscal year 1996, the Fund retained the firm of
Hacker & Johnson as its independent accountant. The
determination to retain Messrs. Coopers & Lybrand, LLP did not
result from any dispute or disagreement with the former
accountant.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
RATIFICATION OF THE APPOINTMENT OF COOPERS & LYBRAND
LLP AS THE FUND'S AUDITOR.
* * * *
PROPOSAL 3:
TO APPROVE AN INVESTMENT MANAGEMENT AGREEMENT
FOR THE FUND
Introduction
Vector Index Advisors, Inc., 15438 North Florida Avenue,
Tampa, Florida, has provided investment management services to
the Fund since the Fund's inception. The Fund is presently the
only client of Vector. On April 15, 1992, the stockholders of
the Fund approved an investment management agreement (the "1992
Agreement") between the Fund and Vector. The 1992 Agreement had
an initial term of two years ending April 15, 1994, and could be
extended annually thereafter. In March 1994, the 1992 Agreement
was continued for an additional year ending April 15, 1995, by
unanimous action of the Board, including the independent
Directors of the Fund. However, the 1992 Agreement was not
effectively continued by the Fund before April 15, 1995, and
therefore expired by its terms on that date.
Nevertheless, Vector has continued to provide investment
management services to the Fund without interruption and without
compensation since April 15, 1995, and proposes to continue to
provide such services. The Board of Directors of the Fund
has been advised by the Fund's counsel that the Fund may
accept such services without payment of compensation to
Vector under applicable provisions of the 1940 Act.
Under the 1940 Act, no person or entity may act as the
"investment advisor" to a registered investment company (such as
the Fund) for compensation, unless such services are provided and
applicable fees are paid pursuant to an effective written
advisory agreement approved as required under the 1940 Act. The
terms of the 1940 Act do not treat as an "investment advisor" a
person or entity which is not compensated for providing its
services. Therefore, Vector is not deemed to be an "investment
advisor" to the Fund as that term is defined in the 1940 Act,
although it has provided such services to the Fund, because it
has not retained any fee for such services. Specifically, Vector
has not retained any investment advisory fees from the Fund for
any period on or after April 15, 1995, because it has had in
effect prior to and during that period a commitment to the Fund
that Vector would waive its management fee under the 1992
Agreement, and in fact has made voluntary payments to the Fund of
additional amounts, to the extent required to reduce the
operating expenses of the Fund to specified levels.
In fact, despite the expiration of the 1992 Agreement,
Vector committed in writing to the Fund that it would: (i)
continue to provide the Fund with the investment management
services called for under the 1992 Agreement, and (ii) would
continue to honor its expense limitation commitments to the Fund
even though the 1992 Agreement was not in effect.
Comparison of the New Management Agreement and Former Management
Agreement
Vector has now proposed to the Board of Directors of the
Fund that the Board and the stockholders of the Fund approve a
new investment management agreement between the Fund and Vector
(the "New Agreement"). The terms of the New Agreement generally
are the same as the terms of the 1992 Agreement, except as set
forth below.
The most significant difference between the 1992 Agreement
and the New Agreement is the compensation provision. The 1992
Agreement provided for compensation of Vector at an annual rate
of 0.60 of 1% of the Fund's net assets. The New Agreement
provides for compensation to Vector at an annual rate of 0.18 of
1% of the Fund's net assets. However, Vector has committed to
the Fund in writing that it will continue its present voluntary
agreement to waive its fee and to reimburse the Fund for expenses
incurred in excess of 0.18% of the Fund's net asset value during
the present fiscal year ending October 31, 1997.
The New Agreement, if and when approved, will bear a new
date. It will also eliminate references to state expense
limitations provisions, which are no longer required because the
National Securities Market Improvement Act of 1996 precludes
states from imposing such limitations. The present expense
limitation provision which Vector has extended to the Fund "caps"
Fund expenses at a level lower than the lowest such limitation.
Other terms of the proposed New Management Agreement are as
follows:
Advisory Services. The New Agreement provides that Vector will
provide professional investment management with respect to the
investment of the assets of the Fund, and will supervise and
arrange the purchase and sale of securities held in the portfolio
of the Fund and generally administer the affairs of the Fund.
Vector will decide what securities will be purchased or sold by
the Fund, and when. Vector also will arrange for the purchase
and sale of securities held in the portfolio of the Fund by
placing purchase and sale orders for the Fund.
The New Agreement also provides that Vector will manage the
affairs of the Fund, including: maintaining the Fund's books and
records; overseeing the Fund's insurance relationships; preparing
the Fund's proxy materials and other regulatory filings;
preparing required "blue sky" filings; responding to shareholder
communications directed to Vector; and overseeing all
relationships between the Fund and its other service providers.
Expenses. The New Agreement provides that Vector will furnish
the Fund with all office space, facilities, and equipment and
clerical personnel necessary for carrying out Vector's duties
under the Agreement. Vector will pay the compensation of all
Directors, officers and employees of the Fund who are affiliated
with Vector. The Fund will pay all other expenses to the extent
that such expenses are not covered by the expense cap described
above.
Limitation of Liability. The New Agreement provides that, in the
absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of obligations or duties ("disabling conduct")
on the part of Vector (and its officers, directors, agents,
employees, or controlling persons, shareholders and any other
persons or entity affiliated with Vector) will not be subject to
liability to the Fund or to any shareholder of the Fund for any
act or omission in the course of, or connected with rendering
services hereunder, including without limitation, any error of
judgment or mistake of law or for any loss suffered by any of
them in connection with the matters to which the Agreement
related, except to the extent specified in Section 36(b) of the
1940 Act concerning loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services.
Except for such disabling conduct, the Fund will indemnify Vector
(and its officers, directors, agents, employees, or controlling
persons, shareholders and any other person or entity affiliated
with Vector) from any liability arising from Vector's conduct
under the Agreement to the extent permitted by law.
Term. If approved by the stockholders of the Fund, the New
Agreement will become effective on the Meeting date, and will
have an initial term ending on September 17, 1999. Thereafter,
the New Agreement will be continued from year to year, provided
that its continuation is specifically approved at least annually:
(a) by a vote of the holders of a majority of the outstanding
shares of the Fund, or by the Board of Directors, and (b) by a
vote of a majority of the Directors who are not parties to the
Agreement or "interested persons" (as defined in the 1940 Act) of
any such party, cast in person at a meeting called for the
purpose of voting on such approval.
Termination; Assignment. The New Agreement provides that it may
be terminated without penalty upon 60 days' written notice by
Vector, by the Directors of the Fund, or by the affirmative vote
of the holders of a "majority of the outstanding voting
securities" of the Fund (as defined in the 1940 Act). Also, the
New Agreement will automatically terminate in the event of its
assignment (as defined in the 1940 Act).
Evaluation of the New Management Agreement by the Board of
Directors of the Fund
The Board met on May 23 and June 5, 1997 to consider the New
Agreement. In evaluating the New Agreement, the Board requested
and reviewed various materials, including materials furnished by
Vector. These materials included information regarding Vector
and its personnel, operations, financial condition and investment
philosophy. Vector also provided information regarding the
performance records and expenses of other mutual funds managed
with investment objectives and policies similar to those of the
Fund. The Board of Directors also considered differences between
the terms of the New Management Agreement and the terms of the
1992 Agreement. The Board noted that the fee payable to Vector
under the New Agreement will be set at a rate which is lower than
the rate of the fee set under the 1992 Agreement.
Also in connection with approval of the New Agreement, the
Directors met with officers of Vector. During these meetings,
personnel from Vector were available to discuss operations of
Vector and to answer questions concerning the proposed investment
management arrangement. In addition, the independent Directors
of the Fund were advised by counsel regarding their fiduciary
duties in connection with their consideration of the proposed
arrangements.
The Board of Directors, in reviewing the proposal that the
Fund retain Vector to continue providing investment management
services to the Fund, considered a number of factors including:
the employment of Steven Adler and other personnel by Vector,
Vector's ability to provide a stable financial environment for
the advisory operations and the Fund; and Vector's commitment to
maintain the current operating expense levels of the Fund.
The Directors concluded that, based upon the foregoing, in
their judgment it would be in the best interest of the Fund and
its stockholders, to cause the Fund to enter into the New
Agreement with Vector. The Board unanimously approved the New
Agreement.
Information About Vector Index Advisors, Inc.
For the fiscal year ended October 31, 1996, Vector was not
entitled to any fees, and reimbursed the Fund for expenses in the
amount of $89,199. The expenses of the Fund for the fiscal year
ended October 31, 1996 after fee waivers and expenses assumed
totalled 1.86% of the Fund's average net assets.
Vector is a Florida corporation organized on February 23,
1990, with principal offices at 15438 North Florida Avenue, Suite
107, Tampa, Florida 33613. Steven H. Adler is Chairman,
President and CEO of Vector, and owns 50.43% of Vector. The
following table provides information about the current directors
and principal officers of Vector:
<TABLE>
<CAPTION>
Name and Position
Address with Vector Principal Occupation
<S> <C> <C>
Steven H. Adler<F1> Chairman, President Vector Index Advisers,
15438 North Flor- and CEO (Chairman, President
ida Avenue CEO and portfolio
Suite 107 Manager, 2/90-present;
Tampa, FL 33613 ASM Index 30 Fund, Inc.
(formerly known as ASM
Fund, Inc.) (Director
and President), 7/90-
present.
Gene F. Mag Director Executive Options,
304 Old Mill Pond Rd. Inc. (President, Executive
Palm Harbor, FL 34683 Recruitment Service),
4/91-present.
Edward Semlitz Director Retired; Sunstate
903 Guisando de Avila Courier, Inc. (President,
Tampa, FL 33613 Bank Courier Service),
10/81-4/94.
S. Cash Ulmer<F1> Vice President Vector Index Advisers,
15438 North Flor- and Compliance Inc. (Vice President
ida Avenue Officer and Compliance
Suite 107 Officer), 3/97-pres-
Tampa, FL 33613 ent.
<FN>
<F1> Indicates persons who are also directors and/or officers of
the Fund.
</FN>
</TABLE>
Mr. Mag and Mr. Semlitz own 2.74% and 4.48% of Vector,
respectively. Mr. Irwin M. Leibowitz, a shareholder of Vector,
owns 5.55% of Vector.
Mr. Adler has been primarily responsible for the day-to-day
management of the Fund since its inception.
Regulatory Matters/SEC Proceeding
During the Fund's fiscal year ending October 31, 1994,
Vector had voluntarily agreed to reimburse the Fund for certain
expenses that exceeded the Fund's expense cap in place during
that period. Although Vector did reimburse the Fund for expenses
that exceeded the cap during that period, Vector did not
reimburse on a timely basis in accordance with the 1940 Act rules
and rules under the Investment Advisers Act of 1940. In 1996 the
SEC, issued an order (the "Order") to Vector and Steven H. Adler,
president of Vector (and a director of the Fund), which
instructed Vector and Mr. Adler to pay a fine and to take certain
measures to assure that such an oversight would not occur again.
Under the Order Vector agreed, among other things, to hire
an independent consultant to complete a thorough exam of Vector
and its operations, and to obtain a report of the findings of the
consultant. Vector retained the Fund's legal counsel to conduct
the examination of Vector. Counsel delivered its report (the
"Report") to the SEC, to the Fund's Board of Directors, and to
Vector on March 14, 1997.
The Report made a number of suggestions to Vector concerning
areas of its operations in which Vector should adopt or improve
its procedures so as to improve the protection provided to the
Fund and the assets of the Fund. Vector has adopted and
implemented all the recommendations set forth in the Report.
The Report also highlighted an issue which Vector is in the
process of addressing. In fiscal year 1993, pursuant to advice
from the Fund's then independent accountants, the Fund concluded that
it had qualified under subchapter M of the Internal Revenue Code
of 1986 (the "Code"). Vector and the Fund are still in the
process of examining whether the Fund did qualify under that
provision of the Code in that year. If the Fund did not qualify,
then it may be required to pay additional taxes under the Code.
However, if it is concluded that the Fund has an additional tax
liability, the determination will not adversely affect the Fund,
as Vector has already committed in writing to the Fund that
Vector will pay whatever taxes (including interest and penalties,
if any) which the Fund may owe, and therefore it is anticipated
that there will be no adverse impact upon the Fund.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
STOCKHOLDERS VOTE TO APPROVE THE NEW
MANAGEMENT AGREEMENT WITH VECTOR.
* * * *
Principal Underwriter and Administrator
The Fund acts as its own distributor. Mutual Funds Services
Co., 6000 Memorial Drive, Dublin, Ohio 43017 is the Fund's
Administrator.
INFORMATION ABOUT OWNERSHIP OF SHARES OF THE FUND
Holders of Fund Shares
From time to time, the number of shares of the Fund held in
"street name" accounts of various securities dealers for the
benefit of their clients may exceed 5% of the total shares
outstanding. To the knowledge of the Fund, according to its
records, the only other entities holding beneficially more than
5% of each Portfolio's outstanding shares of stock as of August 1,
1997 are:
1. Valley Fresh Distributing, Inc. 16,447.37 shares
P.O. Box 1089
Center, CO 81125
2. Diana Engelhorn Trust, DTD 7/10/96 24,852.55 shares
Anthony Williams, TTEE
c/o Coudert Brothers
1114 Avenue of the Americas
New York, NY 10036-7703
3. Diana Engelhorn Trust, DTD 7/10/96 24,800.21 shares
Anthony Williams, TTEE
c/o Coudert Brothers
1114 Avenue of the Americas
New York, NY 10036-7703
GENERAL MATTERS
The Board does not intend to bring any matters before the
Meeting other than the proposals described above, and the Board
is not aware of any other matters to be brought before the
Meeting or any adjournments thereof by others. If any other
matters legally come before the Meeting, it is intended that the
accompanying proxy may be voted on such matters in accordance
with the best judgment of the persons named in said proxy.
In the event that sufficient votes in favor of the proposals
set forth in the Notice of Annual Meeting of Stockholders are not
received by the date of the Meeting, the proxyholders may propose
one or more adjournments of the Meeting for a period or periods
of not more than sixty (60) days in the aggregate to permit
further solicitation of proxies, even though a quorum is present.
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. Proxies
which are instructed to be voted against the matters to be
considered at the Meeting when it reconvenes will be voted
against a proposal to adjourn.
Fund Name Change. The New Management Agreement also
reflects a change in the name of the Fund to "ASM Index 30 Fund,
Inc." The name change was unanimously approved by the Fund's
Board of Directors at a meeting held on March 20, 1997. The
Fund's name was changed to strengthen its identity with its
investment objective, policies and strategy. The name change
comports with SEC proposed rules regarding Fund names.
Fundamental Investment Policy. At the continuance of the March
20, 1997 Board meeting, which was held on May 23, 1997, the Board
of Directors unanimously approved changing to a fundamental
policy the Fund's non-fundamental policy limiting Fund
investments to the thirty (30) companies that comprise the Dow
Jones Industrial Average. The Boards believes that this change
also reflects the Fund's intended investment strategies and
philosophies.
Stockholder Proposals
The Meeting is an annual meeting of stockholders. The Fund
is not required to, nor does it intend to, hold regular annual
meetings of its stockholders. Any stockholder who wishes to
submit a proposal for consideration at the next meeting of
stockholders, when and if such a meeting is called, should submit
such proposal promptly to the Fund.
Reports to Stockholders and Financial Statements
The Annual Report to Stockholders of the Fund, including
audited financial statements of the Fund for the fiscal year
ended October 31, 1996, and the Semi-Annual Report to
Stockholders for the period ended April 30, 1997, are available
from the Fund. The Annual Report and Semi-Annual Report should
be read in conjunction with this Proxy Statement, but are not
part of the proxy soliciting material. A copy of the Annual and
Semi-Annual Reports may be obtained from the Fund, without
charge, by contacting the Fund in writing at the address on the
cover of this Proxy Statement, or by calling 1-800-445-2763.
Respectfully Submitted,
S. CASH ULMER
Secretary
Tampa, Florida
Dated: September ****, 1997
STOCKHOLDERS WHO ARE UNABLE TO ATTEND THE MEETING IN
PERSON ARE REQUESTED TO FILL IN, DATE AND SIGN
THE PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED PREPAID ENVELOPE.
WHEN SIGNING AS ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE
YOUR FULL TITLE AS SUCH. WHERE STOCK IS HELD JOINTLY,
BOTH SIGNATURES ARE REQUIRED.
ASM INDEX 30 FUND, INC.
SPECIAL MEETING OF STOCKHOLDERS - October 30, 1997
The undersigned hereby revokes all previous proxies for his or her
shares and appoints Steven H. Adler and S. Cash Ulmer and each of
them,with full power of substitution, proxies of the undersigned to
vote all shares of ASM Index 30 Fund, Inc. (the "Fund"), which the
undersigned is entitled to vote at the Special Meeting to be held at
15438 North Florida Avenue, Suite 107, Tampa, Florida 33613, at
9:00 a.m. Eastern time on the 30th day of October, 1997, including any
adjournment thereof, upon such business as may properly be brought
before the Meeting.
NO. 1 Election of Directors
/_/ FOR all nominees listed below /_/ WITHHOLD AUTHORITY
(except as marked to the to vote for
contrary below) all nominees listed
below
NOTE: To withhold authority to vote for any individual nominee,
strike a line through the name of the nominee in the list
below.
Steven H. Adler, W. Keith Schilit, Arthur Salzfass
Jerome P. Feltenstein, Daniel Calabria
NO. 2 Ratification of the selection of Coopers & Lybrand LLP, as
the independent auditors for the Fund for the fiscal year
ending October 31, 1997.
FOR AGAINST ABSTAIN
/_/ /_/ /_/
NO. 3 Approval of the New Investment Management Agreement
between the Fund and Vector Index Advisers, Inc.
FOR AGAINST ABSTAIN
/_/ /_/ /_/
NO. 4 Authority to consider and act upon any other business
which may legally come before the Meeting or any
adjournment thereof.
GRANT WITHHOLD
/_/ /_/
PLEASE SIGN AND PROMPTLY RETURN IN THE ACCOMPANYING
ENVELOPE. NO POSTAGE REQUIRED IF MAILED IN THE U.S.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS. IT WILL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, THIS PROXY SHALL BE VOTED
IN FAVOR OF EACH LISTED PROPOSAL (INCLUDING ALL
NOMINEES FOR DIRECTORS). IF ANY OTHER MATTERS
PROPERLY COME BEFORE THE MEETING, AUTHORIZATION IS GIVEN
THE PROXY HOLDERS TO VOTE IN ACCORDANCE WITH THE VIEWS OF
MANAGEMENT THEREON. MANAGEMENT IS NOT AWARE OF ANY SUCH
MATTERS.
Dated: ___________________________
___________________________
Signature
___________________________
Signature
Note: Please sign exactly as your name appears on the proxy. If
signing for estates, trusts or corporations, title or
capacity should be stated. If shares are held jointly,
each holder must sign.
ASM INDEX 30 FUND, INC.
MANAGEMENT AGREEMENT
AGREEMENT made this day of , 1997, by and between ASM
INDEX 30 FUND, INC. (the "Fund'), a Maryland corporation, and
VECTOR INDEX ADVISORS, INC. (the "Manager"), a Florida corporation.
WITNESSETH:
In consideration of the mutual promises and agreements herein
contained and other good and valuable consideration, the receipt of
which is hereby acknowledged, it is hereby agreed by and between
the parties hereto as follows:
1. In General.
The Fund hereby appoints the Manager to act as
investment adviser. The Manager agrees, all as more fully
set forth herein, to provide professional investment
management with respect to the investment of the assets of
the Fund and to supervise and arrange the purchase and sale
of securities held in the portfolio of the Fund and generally
administer the affairs of the Fund.
2. Duties and Obligations of the Manager with respect to
Management of the Fund.
(a) Subject to the succeeding provisions of this section and
subject to the direction and control of the Board of
Directors of the Fund, the Manager shall:
(i) Decide what securities shall be purchased or sold
by the Fund and when; and
(ii) Arrange for the purchase and sale of securities
held in the portfolio of the Fund by placing
purchase and sale orders for the Fund.
(b) Any investment purchases or sales made by the Manager
shall at all times conform to, and be in accordance
with, any requirements imposed by: (1) the provisions of
the Act and of any rules or regulations in force
thereunder; (2) any other applicable provisions of law;
(3) the provisions of the Articles of Incorporation and
By-Laws of the Fund as amended from time to time; (4)
any policies and determinations of the Board of
Directors of the Fund; and (5) the fundamental policies
of the Fund, as reflected in its registration statement
under the Act, or as amended by the shareholders of the
Fund.
(c) The Manager shall also administer the affairs of the
Fund and, in connection therewith, shall be responsible
for (i) maintaining the Fund's books and records, (other
than financial or accounting books and records
maintained by the Fund's custodian or transfer agent);
(ii) overseeing the Fund's insurance relationships;
(iii) preparing for the Fund (or assisting counsel
and/or auditors in the preparation of) all required tax
returns, proxy statements and reports to the Fund's
shareholders and Directors and reports to and other
filings with the Securities and Exchange Commission and
any other governmental agency (the Fund agreeing to
supply or cause to be supplied to the Manager all
necessary financial and other information in connection
with the foregoing); (iv) preparing such applications
and reports as may be necessary to register or maintain
the Fund's registration and/or the registration of the
shares of the Fund under the securities or "blue sky"
laws of the various states selected by the Fund's
Distributor (the Fund agreeing to pay all filing fees or
other similar fees in connection therewith); (v)
responding to all inquiries or other communications of
shareholders, if any, which are directed to the Manager,
or if any such inquiry or communication is more properly
to be responded to by the Fund's custodian, transfer
agent or accounting services agent, overseeing their
response thereto; (vi) overseeing all relationships
between the Fund and its custodian(s), transfer agent(s)
and accounting services agent(s), including the
negotiation of agreements and the supervision of the
performance of such agreements; and (vii) authorizing
and directing any of the Manager's directors, officers
and employees who may be elected as Directors or
officers of the Fund to serve in the capacities in which
they are elected. All services to be furnished by the
Manager under this Agreement may be furnished through
the medium of any such directors, officers or employees
of the Manager.
(d) The Manager shall give the Fund the benefit of its best
judgment and effort in rendering services hereunder. In
the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or
duties ("disabling conduct") hereunder on the part of
the Manager (and its officers, directors, agents,
employees, controlling persons, shareholders and any
other persons or entity affiliated with the Manager) the
Manager shall not be subject to liability to the Fund or
to any shareholder of the Fund for any act or omission
in the course of, or connected with rendering services
hereunder, including without limitation, any error of
judgment or mistake of law or for any loss suffered by
any of them in connection with the matters to which this
Agreement related, except to the extent specified in
Section 36(b) of the Act concerning loss resulting from
a breach of fiduciary duty with respect to the receipt
of compensation for services. Except for such disabling
conduct, the Fund shall indemnify the Manager (and its
officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity
affiliated with the Manager) from any liability arising
from the Manager's conduct under this Agreement to the
extent permitted by the Articles of Incorporation and
applicable law.
(e) Nothing in this Agreement shall prevent the Manager or
any affiliated person (as defined in the Act) of the
Manager from acting as investment adviser or manager
and/or principal underwriter for any other person, firm
or corporation and shall not in any way limit or
restrict the Manager or any such affiliated person from
buying, selling or trading any securities for its or
their own accounts or the accounts of others for whom it
or they my be acting, provided, however, that the
Manager expressly represents that it will undertake no
activities which, in its judgment, will adversely affect
the performance of its obligations to the Fund under
this Agreement.
(f) It is agreed that the Manager shall have no
responsibility or liability for the accuracy or
completeness of the Fund's Registration Statement under
the Act or the Securities Act of 1933 except for
information supplied by the Manager for inclusion
therein.
3. Broker-Dealer Relationships.
In connection with its duties set forth in Section 2(a) (ii)
of this Agreement to arrange for the purchase and the sale
of securities held by the Fund by placing purchase and sale
orders for the Fund, the Manager shall select such broker--
dealers ("brokers") as shall, in the Manager's judgment,
implement the policy of the Fund to achieve "best execution",
i.e., prompt and efficient execution at the most favorable
securities price. In making such selection, the Manager is
authorized to consider the reliability, integrity and
financial condition of the broker. The Manager is also
authorized to consider whether the broker provides brokerage
and/or research services to the Fund and/or other accounts
of the Manager. The commissions paid to such brokers, may
be higher than another broker would have charged if a good
faith determination is made by the Manager that the
commission is reasonable in relation to the services
provided, viewed in terms of either that particular
transaction or the Manager's overall responsibilities as to
the accounts as to which it exercises investment discretion.
The Manager shall use its judgment in determining that the
amount of commissions paid are reasonable in relation to the
value of brokerage and research services provided and need
not place or attempt to place a specific dollar value on such
services or on the portion of commission rates reflecting
such services or on the portion of commission rates
reflecting such services. To demonstrate that such
determinations were in good faith, and to show the overall
reasonableness of commissions paid, the Manager shall be
prepared to show that commissions paid (i) were for purposes
contemplated by this Agreement; (ii) provide lawful and
appropriate assistance to the Manager in the performance of
its decision-making responsibilities; and (iii) were within
a reasonable range as compared to the rates charged by
qualified brokers to other institutional investors as such
rates may become known from available information. The Fund
recognizes that, on any particular transaction, a higher than
usual commission may be paid due to the difficulty of the
transaction in question. The Manager also is authorized to
consider sales of shares as a factor in the selection of
brokers to execute brokerage and principal transaction,
subject to the requirements of "best execution", as defined
above.
4. Allocation of Expenses.
The Manager agrees that it will furnish the Fund, at the
Manager's expense, with all office space and facilities, and
equipment and clerical personnel necessary for carrying out
its duties under this Agreement. The Manager will also pay
all compensation of all Directors, officers and employees of
the Fund who are affiliated persons of the Manager. All
costs and expenses not expressly assumed by the manager under
this agreement shall be paid by the Fund, including, but not
limited to (i) interest and taxes; (ii) brokerage
commissions; (iii) insurance premiums; (iv) compensation and
expenses of its Directors other than those affiliated with
the Manager; (v) legal and audit expenses; (vi) fees and
expenses of the Fund's custodian, shareholder servicing or
transfer agent and accounting services agent; (vii) expenses
incident to the issuance of its shares, including stock
certificates and issuance of shares on the payment of, or
reinvestment of, dividends; (viii) fees and expenses incident
to the registration or qualification under Federal or state
securities laws of the Fund or its shares; (ix) expenses of
preparing, printing and mailing reports, notices, proxy
material and prospectuses to shareholders of the Fund; (x)
all other expenses incidental to holding meeting of the
Fund's shareholders; (xi) dues or assessments of or
contributions to the Investment Company Institute or any
successor or other industry association; (xii) such non-
recurring expenses as may arise, including litigation
affecting the Fund and the legal obligations which the Fund
may have to indemnify its officers and Directors with respect
thereto; and (xiii) all expenses which the Fund agrees to
bear in any distribution agreement or in any plan adopted by
the Fund pursuant to Rule 12b-1 under the Act.
Organizational expenses will be borne by the Fund. It is
agreed that these expenses are to be deferred and amortized
over a five year period from the commencement of operations
utilizing the straight-line method of amortization.
5. Compensation of the Manager.
(a) The Fund agrees to pay the Manager and the Manager
agrees to accept as full compensation for all services
rendered by the Manager as such, an annual management
fee, payable monthly and computed on the value of the
net assets of the Fund as of the close of business each
business day at the annual rate of 0.08 of 1% of such
net assets of the Fund.
6. Duration and Termination.
(a) This Agreement shall go into effect on the date set
forth above and shall, unless terminated as hereinafter
provided, continue in effect until 1999 and thereafter
from year to year, but only so long as such continuance
is specifically approved at least annually by the Fund's
Board of Directors, including the vote of a majority of
the Directors who are not parties to this Agreement or
"interested persons" (as defined in the Act) of any such
party cast in person at a meeting called for the purpose
of voting on such approval, or by the vote of the
holders of a "majority" (as so defined) of the
outstanding voting securities of the Fund.
(b) This Agreement may be terminated by the Manager at any
time without penalty upon giving the Fund sixty (60)
days' written notice (which notice may be waived by the
Fund) and may be terminated by the Fund at any time
without penalty upon giving the Manager sixty (60) days'
written notice (which notice may be waived by the
Manager), provided that such termination by the Fund
shall be directed or approved by the vote of a majority
of all of its Directors in office at the time or by the
vote of the holders of a majority (as defined in the
Act) of the voting securities of the Fund. This
Agreement shall automatically terminate in the event of
its assignment (as defined in the Act).
IN WITNESS WHEREOF, the parties hereto have caused the
foregoing instrument to be executed by duly authorized persons and
their seals to be hereunto affixed, all as of the day and year
first above written.
ASM INDEX 30 FUND, INC.
By:
ATTEST:
VECTOR INDEX ADVISORS, INC.
By:
ATTEST:
