<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. __)
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement ( ) Confidential, for Use
of the Commission
Only (as permitted by
Rule 14c-6(e)(2)
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Universal Capital Investment Trust
---------------------------------------------------------------------
(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)(4) 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 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:
- ---------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- ---------------------------------------------------------------------------
(3) Filing Party:
- ---------------------------------------------------------------------------
(4) Date Filed:
- ---------------------------------------------------------------------------
<PAGE>
<PAGE>
Universal Capital Growth Fund
One Oakbrook Terrace
Suite 708
Oakbrook Terrace, Illinois 60181
630-932-3000
July 16, 1997
Dear Shareholder:
As was recently announced, the Fund's investment adviser, Integrated
Financial Services, Inc. ("IFS"), has entered into an Asset Purchase
Agreement with Graver, Bokhof, Goodwin & Sullivan ("GBGS"), pursuant to
which GBGS would assume the investment management of the Fund under the
same terms and conditions as the Fund's current investment advisory
agreement. Notwithstanding the proposed change in investment management,
Dreher & Associates, Inc. ("Dreher") would continue to serve as the Fund's
distributor.
Under the Investment Company Act of 1940, the asset sale would constitute
an "assignment" of the Fund's investment advisory agreement and, therefore,
would result in an automatic termination of that agreement. Accordingly,
it is necessary for you to approve a new investment advisory agreement. In
addition, you are also being asked to elect a new Board of Trustees.
As you review the attached materials, please keep in mind that IFS, not
your Fund, plans to sell its assets to GBGS. Also, it is important to
remember that GBGS has agreed to manage the Fund without any change in
investment advisory fees and has agreed to assume the current undertaking
of IFS to limit the Fund's ordinary operating expenses to 2% of the Fund's
average daily net assets through December 31, 1997.
THE BOARD OF TRUSTEES OF YOUR FUND HAS UNANIMOUSLY APPROVED EACH PROPOSAL
AND RECOMMENDS THEM FOR YOUR APPROVAL. IN ADDITION, I SUPPORT THESE
PROPOSALS AND INTEND TO CONTINUE IN MY ROLE WITH THE DISTRIBUTOR OF THE
FUND AND TO PROVIDE CONSULTATION SERVICES TO THE GBGS ADVISORY TEAM. I AM
PLEASED TO VOTE MY OWN SHARES OF THE FUND IN FAVOR OF THESE PROPOSALS AND
PERSONALLY RECOMMEND THE SAME COURSE TO YOU.
As always, we thank you for your confidence and support. If you have any
questions about any of the proposals, please feel free to call me directly.
Sincerely,
/s/ James A. Dreher
- -------------------
James A. Dreher
Chairman of the Board
<PAGE>
<PAGE>
UNIVERSAL CAPITAL INVESTMENT TRUST
One Oakbrook Terrace
Oakbrook Terrace, Illinois 60181
(630) 932-3000
---------------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
August 13, 1997
---------------------------------
To the shareholders of Universal Capital Investment Trust:
A special meeting of the shareholders of Universal Capital Growth Fund (the
"Fund"), a series of Universal Capital Investment Trust (the "Trust"), will
be held at the office of the Trust, One Oakbrook Terrace, Oakbrook Terrace,
Illinois 60181, on August 13, 1997, at 10:00 a.m., Chicago time, to:
1. Elect a board of trustees;
2. Consider approval of a new investment advisory agreement with Graver,
Bokhof, Goodwin & Sullivan ("GBGS"); and
3. Transact such other business as may properly come before the meeting.
Shareholders of record at the close of business on June 30, 1997 are
entitled to vote at the meeting.
For the board of trustees,
Linda M. Kozak
Secretary
July 16, 1997
* * * YOUR VOTE IS IMPORTANT * * *
PLEASE SIGN AND MAIL THE ENCLOSED PROXY CARD
<PAGE>
<PAGE>
PROXY STATEMENT
The board of trustees of Universal Capital Investment Trust (the "Trust")
is soliciting proxies from the shareholders for use at a special meeting of
shareholders to be held August 13, 1997, and at any adjournment of that
meeting. A proxy may be revoked at any time before it is voted, either in
person or by written notice to the Trust or by delivery of a later-dated
proxy.
Shareholders of record of the Trust at the close of business on June 30,
1997 are entitled to participate in the meeting and to cast one vote for
each share held. The Trust had 705,374.533 shares of beneficial interest
outstanding on the record date, all of which were shares of Universal
Capital Growth Fund (the "Fund"), the only series of the Trust. This proxy
statement is first being mailed to shareholders on or about July 16, 1997. Any
shareholder who desires a copy of the previously-mailed annual report (or the
more recent semi-annual report) may obtain it upon request, without charge,
from the office of the Trust, One Oakbrook Terrace, Suite 708, Oakbrook
Terrace, Illinois 60181 or by calling (630) 932-3000.
INTRODUCTION
Integrated Financial Services, Inc. ("IFS") is the investment adviser for
the Fund. Dreher & Associates, Inc. ("Dreher") is the distributor for the
Fund. Both IFS and Dreher are majority owned by James A. Dreher.
On June 11, 1997, IFS, GBGS, Dreher and James A. Dreher entered into an
agreement (the "Asset Purchase Agreement") pursuant to which GBGS will buy
specified assets of IFS (the "Asset Sale"). The specified assets (the
"Assets") include (a) IFS's right in and use of the "Universal Capital"
name; (b) the investment advisory agreement dated January 14, 1991 by and
among IFS, Dreher and the Fund; (c) all IFS's files, books, records and
data files relating to the Fund and its investment history; and (d) all
records relating to the Fund required to be maintained and retained under
the 1940 Act or the Investment Advisers Act of 1940. Upon closing of the
Asset Sale (scheduled for August 15, 1997 or as soon thereafter as
practicable), GBGS would assume the investment management of the Fund under
the same terms and conditions as the current investment advisory agreement,
and Dreher would continue to serve as the Fund's distributor. Under the
Investment Company Act of 1940 (the "1940 Act"), the Asset Sale would
constitute an "assignment" of the Fund's investment advisory agreement and,
therefore, would result in an automatic termination of that agreement.
Accordingly, as discussed further below, a new investment advisory
agreement for the Fund with GBGS is being proposed.
In exchange for the Assets, GBGS will pay $16,600 in cash to IFS. In
addition to the Asset Purchase Agreement, GBGS and IFS have entered into a
Consulting Agreement dated as of June 11, 1997. Under the terms of the
Consulting Agreement, GBGS will engage IFS to provide consulting services
to GBGS with respect to the marketing and distribution of the Fund, for
twelve years, commencing upon the closing of the Asset Sale (the "Effective
Date"). GBGS will compensate IFS for such consulting services as follows:
(a) by paying IFS $16,600 on the six-month anniversary of the Effective
Date, (b) by making ten payments of $16,600, adjusted by a ratio measuring
net sales/redemptions, commencing on the one-year anniversary of the
Effective Date and every six months thereafter, and (c) by making twelve
payments, each equal to 1.00% of the investment advisory fees paid by the
Fund to GBGS during the preceding six-month period, commencing on the six-
year anniversary of the Effective Date and every six months thereafter.
<PAGE>
<PAGE>
The Asset Purchase Agreement requires other important commitments from the
parties, including the following:
* IFS, Dreher and James A. Dreher agree to not engage in the business
of providing investment advisory services to any registered
investment company for six years from the date of the closing of the
Asset Sale (the "Closing Date").
* GBGS agrees to not take or recommend any action that would (a) cause
more than 25% of the trustees of the Board of the Fund to be
"interested persons," as defined in Section 2(a)(19) of the 1940 Act
for three years from the Closing Date, or (b) constitute an "unfair
burden" on the Fund within the meaning of Section 15(f) of the 1940
Act for a period of two years from the Closing Date.
* GBGS, to the extent consistent with its fiduciary duties and
applicable law, agrees to recommend to the Board that Dreher be
appointed the distributor of the shares of the Fund pursuant to a
Distribution Agreement until the sixth anniversary of the Closing
Date.
* Dreher, to the extent consistent with its fiduciary duties, trade
principles, NASD rules and other laws, agrees to recommend that its
customers for whom the Fund is a suitable investment and other
broker-dealers with which it has a selling group agreement that they
invest or remain invested in the Portfolio for six years following
the Closing Date.
* GBGS agrees, for a period of six years after the Closing Date, and
subject to approval of the Board, to use its best efforts to execute
Fund agency trades with Dreher if, in GBGS's judgment, the use of
Dreher is likely to result in prices and execution at least as
favorable to the Fund as those available from other qualified brokers
and if, in such transactions, Dreher charges the Fund commission
rates consistent with those charged by Dreher to comparable
unaffiliated customers in similar transactions and no less favorable
to the Fund, as a percentage of Dreher's standard commission
schedule, than charged by Dreher to the Fund prior to the Closing
Date.
Under the Asset Purchase Agreement, the closing of the Asset Sale is
subject to several conditions, including the conditions that: (1) the
Board take action (a) to approve an investment advisory agreement between
GBGS and the Fund, (b) to approve a distribution arrangement acceptable to
GBGS, (c) to approve a restructuring of the Board to comply with Section
15(f) of the 1940 Act, to include a representative of GBGS and to exclude
the current interested trustees (the "Board Restructuring"), and (d) to
call, with a recommendation of a favorable vote, a shareholder meeting of
the Fund to approve the Fund's investment advisory agreement with GBGS and
the Board Restructuring; and (2) the Fund's shareholders approve the new
investment advisory agreement and the Board Restructuring. In addition,
the Asset Purchase Agreement may be terminated by GBGS on the Closing Date
if the total net assets of the Fund are less than $10,000,000. The
Agreement may also be terminated if the closing of the Asset Sale does not
occur on or before December 31, 1997.
2
<PAGE>
<PAGE>
1. ELECTION OF TRUSTEES
A condition to the consummation of the Asset Sale is that a restructuring
of the Board be approved such that the composition of the Board complies
with Section 15(f) of the 1940 Act. Section 15(f) provides, in pertinent
part, that for a period of three years after the Asset Sale, at least 75%
of the trustees of the Board may not be "interested persons" (as defined in
the 1940 Act) of IFS or GBGS.
In order to meet the requirements of Section 15(f), four (4) persons have
been nominated to the Board by the current disinterested trustees. The
nominees include one of the current disinterested trustees (Alan L. Zable),
two additional disinterested nominees (William J. Breen and Robert F.
Seebeck) and one nominee who is affiliated with GBGS (Andrew J. Goodwin,
III).
The nominees, if elected, will take office upon the consummation of the
Asset Sale and their election and qualification is contingent upon
consummation of the Asset Sale. The term of each person elected as trustee
will be from the date of the consummation of the Asset Sale until the next
meeting held for the purpose of electing trustees and until his or her
successor is elected and qualified. If the Asset Sale is not consummated,
the current trustees of the Trust will continue to serve as the Trust's
Board.
All of the nominees have consented to serve as trustees. However, if any
nominee is not available for election at the time of the meeting, the
proxies may be voted for such other person(s) as shall be determined by the
persons acting under the proxies in their discretion.
The following tables show each nominee and non-continuing trustee and such
person's age as of May 31, 1997, principal occupation or employment during
the past five years and other board memberships. The tables also show, to
the extent applicable, the year in which the person was first elected or
appointed to the Board of Trustees of the Trust.
<TABLE>
<CAPTION>
NOMINEES
NAME, AGE AND FIVE-YEAR BUSINESS EXPERIENCE LENGTH OF SERVICE
<S> <C>
Andrew J. Goodwin, III (53)(1) Nominee
General Partner of GBGS since 1991;
Managing Director of Garzarelli Investment
Management, LLC, since 1995; Treasurer and
Secretary of The Garzarelli Funds since 1997
William J. Breen (59) Nominee
Principal, Financial Computer Services and
Disciplined Investment Advisors, Inc. since 1972;
Professor of Finance, Northwestern University
since 1974
Robert F. Seebeck (71) Nominee
Retired; formerly, Managing Director of
Russell Reynolds Associates, Inc., August,
1974 through December, 1996; Vice President
and Director of Smith Barney & Co., June,
1960 through August, 1974.
3
<PAGE>
<PAGE>
NAME, AGE AND FIVE-YEAR BUSINESS EXPERIENCE LENGTH OF SERVICE
Alan L. Zable (61)(2) Since 1991
Consultant since January 1, 1995; Senior
Vice President and Treasurer, Midwest Stock
Exchange, Incorporated, April 1988 through
December 1994; Managing Director and Chief
Financial Officer, Mesirow Financial Services,
Inc. (financial services holding company),
prior thereto
</TABLE>
<TABLE>
<CAPTION>
NON-CONTINUING TRUSTEES
NAME, AGE AND FIVE-YEAR BUSINESS EXPERIENCE LENGTH OF SERVICE
<S> <C>
Richard H. Burgess (63)(3) Since 1991
Compliance Officer, Terra Securities
Corp.; Director of Field Audits, Dreher
& Associates, Inc., December 1995 to
June 1996; Vice President prior thereto,
Dreher & Associates, Inc.
Patricia M. Ellington (61)(3) Since 1991
Vice President, Dreher & Associates, Inc.
since 1987 and Secretary prior thereto;
Assistant Secretary and Assistant
Treasurer, Integrated Financial Services,
Inc., since 1988
Dennis J. Hiffman (55) Since 1991
Vice President, Hiffman Shaffer
Associates, Inc. (commercial and
industrial real estate development,
management and brokerage).
Harold D. McAninch (64)
Consultant; Interim President, Dundalk Since 1991
Community College, June 1994 until
January 1996; prior thereto, President,
College of DuPage (community college).
</TABLE>
(1) Mr. Goodwin is an "affiliate" of GBGS as defined in the 1940 Act.
(2) Messrs. Hiffman, McAninch and Zable are members of the audit
committee of the board of trustees, which makes recommendations
regarding the selection of the Trust's independent auditors and meets
with representatives of the independent auditors to determine the
scope and review the results of each audit.
(3) Mr. Burgess and Ms. Ellington are "interested persons" of the Trust
as defined in the 1940 Act and Ms. Ellington is a member of the
executive committee of the board of trustees which has authority
during intervals between meetings of the board of trustees to
exercise the powers of the board.
4
<PAGE>
<PAGE>
The following table shows shares of the Fund as to which each trustee or
nominee, and all current trustees and officers of the Trust as a group, had
or shared power over voting or disposition at May 31, 1997.
<TABLE>
<CAPTION>
Amount of
Beneficial Ownership(1)
------------------------
Sole Voting Other
Name of or Investment Beneficial Percentage
Trustee Power(2) Ownership(3) Ownership
------- ------------- ------------ ----------
<S> <C> <C> <C>
Richard H. Burgess 1,523 0 *
Patricia M. Ellington 4,039 407 *
Andrew J. Goodwin, III 0 0 0
Dennis J. Hiffman 0 0 0
Harold D. McAninch 1,487 0 *
Alan L. Zable 2,568 0 *
Trustees and officers of the 21,244 3,088 3%
Trust as a group
(eight persons)
</TABLE>
- --------------
* Less than 1% of the outstanding shares of the Fund
(1) All of the shares of the Fund over which the nominees, trustees and
officers of the Trust, directly or indirectly, had or shared voting
or investment power, have been deemed beneficially owned in
accordance with Rule 13d-3 of the Securities Exchange Act of 1934.
(2) Includes all shares as to which such person had sole power over
voting or disposition, and includes shares over which such persons
had sole power over disposition but not voting, allocated under
certain benefit plans to the accounts of the trustees and officers
who are employees of the investment adviser.
(3) Includes all shares as to which such person had shared power over
voting or disposition and shares beneficially owned by the spouse and
minor children of such person (as to which he or she disclaims actual
beneficial ownership).
The Board met four times during the Trust's fiscal year ended September 30,
1996. Each then current trustee attended 75% or more of the meetings of
the Board and the committees of which he or she was a member. The Board does
not have a standing nominating committee.
The Trust currently pays each disinterested trustee $250 per meeting.
Trustees or officers who are "interested persons" receive no compensation
from the Trust for their services as such.
5
<PAGE>
<PAGE>
The table below shows, for each disinterested trustee, the aggregate
compensation paid or accrued by the Trust for the fiscal year ended
September 30, 1996.
<TABLE>
<CAPTION>
TRUSTEES AGGREGATE COMPENSATION FROM TRUST
-------- ---------------------------------
<S> <C>
Dennis J. Hiffman $1,000
Harold D. McAninch $ 750
Alan L. Zable $1,000
</TABLE>
2. APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT
INTRODUCTION. As discussed above, consummation of the Asset Sale would
constitute an "assignment" of the Fund's current investment advisory
agreement and, therefore, would result in an automatic termination of that
agreement. Accordingly, on June 30, 1997, the Board of Trustees, including
the disinterested trustees, unanimously approved a new investment advisory
agreement with GBGS, subject to approval by the shareholders of the Fund
and the consummation of the Asset Sale. The following discussion is
qualified in its entirety by reference to the form of new investment
advisory agreement attached hereto as Exhibit A.
CURRENT INVESTMENT ADVISORY AGREEMENT. IFS has served as investment
advisor to the Fund since its inception in 1991 pursuant to an investment
advisory agreement dated January 14, 1991. The current agreement was last
approved by shareholders on March 9, 1992 in connection with the shareholders'
initial approval of such agreement following a public offering of the Fund,
and last renewed by the Board of Trustees, including a majority of the
disinterested trustees, on December 11, 1996.
Under the terms of the current agreement, subject to the expense
limitations described below, the Fund pays all its own operating expenses
that are not specifically assumed by IFS, including (i) the advisory fee;
(ii) interest; taxes and any governmental filing fees; (iii) compensation
and expenses of the trustees, other than those who are interested persons
of the Trust, IFS or Dreher, the distributor for the Fund; (iv) legal,
audit, custodial, fund accounting and transfer agency fees and expenses;
(v) fees and expenses related to the organization of the Fund and
registration and qualification of the Fund and its shares under federal and
state securities laws; (vi) expenses of printing and mailing reports,
notices and proxy material to shareholders, and expenses incidental to
meetings of shareholders; (vii) expenses of preparing prospectuses and of
printing and distributing them to existing shareholders; (viii) insurance
premiums; (ix) litigation and indemnification expenses and other
extraordinary expenses not incurred in the normal course of the business of
the Trust; (x) distribution expenses pursuant to the Distribution Plan; and
(xi) brokerage commissions and other transaction-related costs.
For its management and advisory services, IFS is paid by the Fund a fee,
accrued daily and paid monthly, at the annual rate of 1.0% of the first
$250 million of the Fund's average daily net assets and .75% of average
daily net assets in excess of $250 million. IFS has voluntarily undertaken
to reimburse the Fund for any annual operating expenses in excess of 2% of
the Fund's average net assets through December 31, 1997.
6
<PAGE>
<PAGE>
During the fiscal year ended September 30, 1997, the Fund incurred total
advisory fees of $102,176, but IFS waived fees or reimbursed expenses in
the aggregate amount of $35,431 pursuant to its expense limitation
undertaking.
The current agreement will remain in effect until January 13, 1998, and
from year to year thereafter, so long as its continuance is approved at
least annually by (a) the board of trustees of the Trust or by the vote of
a majority of the outstanding voting securities of the Fund and (b) the
vote of a majority of the trustees of the Trust who are not "interested
persons" of any party to the agreement, cast in person at a meeting called
for the purpose of voting on such approval. The current agreement may be
terminated at any time, without penalty, by either the Trust or IFS on 60
days' written notice and is automatically terminated in the event of its
assignment (as defined in the 1940 Act).
The current agreement provides that IFS shall not be liable for any loss
suffered by the Trust or its shareholders as a consequence of any act or
omission in connection with investment advisory or portfolio services under
the agreement, except by reason of willful misfeasance, bad faith or gross
negligence on the part of IFS in the performance of its duties or by reason
of reckless disregard by IFS of its obligations and duties under the
agreement.
NEW INVESTMENT ADVISORY AGREEMENT. As noted above, consummation of the
Asset Sale would constitute an "assignment," as that term is defined in the
1940 Act, of the Funds' current investment agreement with IFS. As
required by the 1940 Act, the current investment advisory agreement
provides for its automatic termination in the event of its assignment. In
anticipation of the Asset Sale, a new investment advisory agreement between
the Fund and GBGS is being proposed for approval by the shareholders of the
Fund. The new investment advisory agreement will be dated as of the date
of the consummation of the Asset Sale. The Asset Sale is currently
expected to close on August 15, 1997. The new investment advisory
agreement will be in effect for an initial term ending March 31, 1999, and
may continue thereafter from year to year if approved at least annually by
a "majority of the outstanding voting securities" of the Fund, as defined
in the 1940 Act, or by the Board and, in either event, by the vote of a
majority of the trustees who are not parties to the agreement or interested
persons of any such party, cast in person at a meeting called for such
purpose. THE NEW INVESTMENT ADVISORY AGREEMENT IS ON THE SAME TERMS AS THE
CURRENT INVESTMENT ADVISORY AGREEMENT.
INFORMATION REGARDING GBGS. Graver, Bokhof, Goodwin & Sullivan is a
registered investment adviser whose predecessor firm was founded in 1981.
The firm is owned by its principals, who also have ownership interests in
three other advisory firms. The combined assets under management for the
affiliated firms exceed $1 billion, with investment management provided to
both institutional and individual clients. Among the firms there are 16
professional and 11 staff members who provide investment and administrative
services to clients in equity, fixed income and venture capital portfolio
management.
BOARD OF TRUSTEES EVALUATION. The Board of Trustees met on June 30, 1997
to consider the Asset Sale and its anticipated effects of the Fund. On
that date, the Board, including a majority of the trustees who are not
parties to the proposed new investment advisory agreement or interested
persons of IFS or GBGS, voted to approve the new investment advisory
agreement and to recommend it to shareholders for their approval. The
Board obtained from IFS, GBGS and Dreher various information regarding GBGS
and the plans of the parties. At the June 1997 meeting, GBGS personnel
presented a review of various matters including the history and
organizational structure of GBGS, its investment performance record, the
7
<PAGE>
<PAGE>
proposed team of GBGS partners and associates that would manage the Fund,
its investments strategy, its financial condition and its general plans for
the Fund.
During its deliberations, the Board used the assistance of legal counsel in
understanding its fiduciary duties and the ramifications to the Fund of
the Asset Sale. The Board questioned both GBGS and Dreher about the
planned distribution of the Fund, including the proposed new sales
commission schedule. The Board also discussed with GBGS its Fund
administration capabilities and its plans.
In connection with its deliberations, the Board obtained certain assurances
from the parties, including the following:
* GBGS had no current intention to change the Fund's investment
objectives or policies.
* GBGS intends to devote to the Fund and its affairs all attention and
resources that are necessary to provide the Fund with top quality
investment advisory services.
* GBGS, IFS, Dreher and Mr. Dreher intend to comply with Section 15(f)
of the 1940 Act and are not aware of any express or implied term,
condition, arrangement or understanding that would impose an "unfair
burden" on the Fund as a result of the Asset Sale.
* GBGS, Dreher and Mr. Dreher would take no action that would have the
effect of imposing an "unfair burden" on the Fund as a result of the
Asset Sale.
* GBGS would pay the cost of preparing and distributing proxy materials
to and of holding the meeting of the Fund's shareholders as well as
other fees and expenses in connection with the Asset Sale, including
the fees and expenses of legal counsel to the fund.
In evaluating the new investment advisory agreement, the Board took into
account that the terms relating to the services provided and the fees and
expenses payable by the Fund are the same under the current investment
advisory agreement. The Board noted that in previously approving the
current investment advisory agreement, the Board had considered a number of
factors including the investment advisory fees and expense ratios of the
Fund and competitive investment companies.
The Board particularly considered, as discussed above, the conditions in
the Asset Purchase Agreement that GBGS agrees to recommend to the Board
that Dreher be appointed the distributor of the shares of the Fund and that
GBGS agrees to use its best efforts to execute Fund agency trades with
Dreher.
The Board also considered the recommendation of GBGS and Dreher to revise
the Fund's front-end sales commission schedule coincident with the
consummation of the Asset Sale. See "Other Information - Distributor and
Current Rule 12b-1 Plan" below.
As a result of its investigation and consideration of the Asset Sale and
the new investment advisory agreement, at its June 30, 1997 meeting, the
Board voted to approve the new investment advisory agreement and to
recommend it to shareholders of the Fund for their approval.
8
<PAGE>
<PAGE>
3. OTHER MATTERS
The management is not aware of any other matters that will come before the
meeting. If any other business should come before the meeting, however,
your proxy, if signed and returned, will give discretionary authority to
the persons designated in it to vote according to their best judgment.
OTHER INFORMATION
EXECUTIVE OFFICERS OF THE TRUST. The officers of the Trust, their
principal occupations during the past five years, other business
affiliations and ages at May 31, 1997, are set forth below:
<TABLE>
<CAPTION>
Position(s)
Name (Age) with Trust Principal Occupation(s)
---------- ----------- -----------------------
<S> <C> <C>
James A. Dreher (63) Chairman President, Integrated Financial
Services, Inc., and President,
Dreher & Associates Inc.
Patricia M. Ellington (61) Trustee and President Vice President, Dreher &
Associates, Inc., since 1987
and Secretary prior thereto;
Assistant Secretary and
Assistant Treasurer, Integrated
Financial Services, Inc., since
1988
Linda M. Kozak (36) Secretary and Treasurer Secretary and Treasurer,
Dreher & Associates, Inc.
(since 1987)and Integrated
Financial Services, Inc. and
Dreher Insurance Services, Inc.
(since 1988); Tax accountant,
Coopers & Lybrand, prior to
1987.
</TABLE>
It is anticipated that, after consummation of the Asset Sale, the
restructured Board will elect new officers who are expected to include
persons affiliated with GBGS.
GBGS. GBGS is located at 100 South Wacker Drive, Suite 2100, Chicago,
Illinois 60606-4005. GBGS is a limited partnership organized under the
laws of the State of Illinois. The names and principal occupations of the
General Partners of GBGS are as follows:
<TABLE>
<CAPTION>
Name Principal Occupation
- ---- --------------------
<S> <C>
Steven F. Graver Partner, Graver, Bokhof, Goodwin & Sullivan
H. Steel Bokhof, Jr. Partner, Graver, Bokhof, Goodwin & Sullivan
Andrew J. Goodwin, III* Partner, Graver, Bokhof, Goodwin & Sullivan
James F. Sullivan Partner, Graver, Bokhof, Goodwin & Sullivan
Principal, Burnham, Sullivan, Andelbradt & Co.
</TABLE>
- ----------------
* as 85% General Partner of Goodwin Investors L.P.
9
<PAGE>
<PAGE>
IFS. IFS is located at One Oakbrook Terrace, Suite 708, Oakbrook Terrace,
Illinois 60181. IFS is owned 67% by James A. Dreher, 10% by Patricia M.
Ellington, 10% by Richard H. Burgess and 13% by Daniel Zawada, Executor of
the Estate of Nicholas J. Biscan. The names and principal occupations of
the principal executive officers and the directors of IFS are as follows:
<TABLE>
<CAPTION>
Name Principal Occupation
- ---- ---------------------
<S> <C>
James A. Dreher President and Director,
Integrated Financial Services, Inc. and
Dreher & Associates
Linda M. Kozak Secretary and Treasurer,
Integrated Financial Services, Inc.
Patricia M. Ellington Vice President,
Integrated Financial Services, Inc.
</TABLE>
DISTRIBUTOR AND CURRENT RULE 12B-1 PLAN. Dreher, a broker-dealer owned by
Messrs. Dreher and Burgess and Ms. Ellington, serves as distributor for the
Fund. Dreher has the exclusive right to distribute shares of the Fund in a
continuous offering through affiliated and unaffiliated dealers. The
obligation of Dreher is an agency or "best efforts" arrangement, which does not
obligate Dreher to sell any stated number of shares. Dreher is located at One
Oakbrook Terrace, Suite 708, Oakbrook Terrace, Illinois 60181. Dreher is
responsible for all purchases, sales, redemptions and other transfers of
shares of the Fund without any charge to the Fund except the fees paid to
Dreher under the Distribution Plan. Dreher is also responsible for all
expenses incurred in connection with its performance of services for the
Fund, including, but not limited to, personnel, office space and equipment,
telephone, postage and stationery expenses. Dreher receives commissions
from sales of shares of the Fund which amounts are not expenses of the Fund
but represent sales commissions added to the net asset value of shares
purchased from the Fund. During the fiscal year ended September 30, 1996,
Dreher received and retained commissions of $33,145. As noted above,
coincident with the Asset Sale, the Board has approved a change in the
Fund's front-end sales commission schedule, as follows:
<TABLE>
<CAPTION>
Paid by the Investor
--------------------
% of Offering
As a % of Offering As a % of Net Price Retained by
Investment Price Amount Invested* Selling Dealer
- ---------- ------------------ ---------------- -----------------
<S> <C> <C> <C>
Less than $50,000 5.50% 5.82% 4.75%
$50,000 but less than $100,000 4.50% 4.71% 3.75%
$100,000 but less than $200,000 3.50% 3.63% 2.75%
$200,000 but less than $350,000 2.50% 2.56% 2.00%
$350,000 but less than $500,000 1.50% 1.52% 1.00%
$500,000 and over 0.00% 0.00% 0.00%
</TABLE>
* Rounded to the nearest one-hundredth percent.
10
<PAGE>
<PAGE>
However, shareholders of the Fund prior to the date of the Asset Sale will be
permitted to purchase shares of the Fund in accordance with the Fund's previous
front-end sales commission schedule which follows:
<TABLE>
<CAPTION>
Paid by the Investor
--------------------
% of Offering
As a % of Offering As a % of Net Price Retained by
Investment Price Amount Invested* Selling Dealer
- ---------- ------------------ ---------------- -----------------
<S> <C> <C> <C>
Less than $100,000 1.50% 1.52% 1.75%
$100,000 but less than $250,000 1.00% 1.01% 1.25%
$250,000 or more NONE NONE 0.25%
</TABLE>
* Rounded to the nearest one-hundredth percent.
The Trust has adopted a Distribution Plan pursuant to Rule 12b-1 under the
1940 Act dated January 14, 1991, whereby the Fund pays to Dreher, as
compensation for the services and expenses described below, fees accrued
daily and paid monthly at the aggregate annual rate of .50% of the Fund's
average daily net assets for expenses incurred in the distribution of the
Fund's shares.
Under the Distribution Plan, Dreher makes payments (commonly called "trail
commissions") to broker-dealers and others who have executed selling group
agreements with Dreher, at rates of up to .50% of the average daily net
asset value of shares held by shareholders to whom selling group members
provide services. Dreher also pays for the preparation and printing of
advertising and sales literature, the printing of prospectuses and
shareholder reports used for marketing purposes, and other expenses
incurred in connection with the sale of Fund shares.
During the year ended September 30, 1996, the Fund made payments to Dreher
pursuant to the Distribution Plan, and Dreher paid expenses in connection
with the distribution of Fund shares as shown below:
<TABLE>
<CAPTION>
<S> <C>
Distribution fees paid by Fund to Dreher: $51,088
Distribution expenses incurred by Dreher:
Fees reallowed to brokers $30,653
Employee Compensation 5,840
Printing - Quarterly reports to brokers 2,420
Printing - Prospectus 6,269
Printing - Other 629
Other marketing expenses 2,127
Total Expenses $47,938
-------
</TABLE>
11
<PAGE>
<PAGE>
PORTFOLIO TRANSACTIONS. Portfolio transactions on behalf of the Fund
effected on stock exchanges involve the payment of negotiated brokerage
commissions. There is generally no stated commission in the case of
securities traded in the over-the-counter markets, but the price paid by
the Fund usually includes an undisclosed dealer commission or mark-up. In
underwritten offerings, the price paid by the Fund includes a disclosed,
fixed commission or discount retained by the underwriter or dealer.
In executing portfolio transactions, IFS does, and GBGS would, use its best
efforts to obtain for the Fund the most favorable price and execution
available. In seeking the most favorable price and execution, IFS does,
and GBGS would, consider all factors it deems relevant, including price,
the size of the transaction, the nature of the market for the security, the
amount of commission, the timing of the transaction taking into account
market prices and trends, the execution capability of the broker-dealer and
the quality of service rendered by the broker-dealer in the other
transactions.
The trustees have determined that portfolio transactions for the Fund may
be executed through Dreher, if, in the judgment of IFS, the use of Dreher
is likely to result in prices and execution at least as favorable to the
Fund as those available from other qualified brokers and if, in such
transactions, Dreher charges the Fund commission rates consistent with
those charged by Dreher to comparable unaffiliated customers in similar
transactions. The board of trustees, including a majority of the trustees
who are not interested trustees, has adopted procedures that are reasonably
designed to provide that any commissions, fees or other remuneration paid
to Dreher are consistent with the foregoing standard. The Fund will not
effect principal transactions with Dreher. In executing portfolio
transactions through Dreher, the Fund will be subject to, and intends fully
to comply with, section 17(e) of the Investment Company Act of 1940 and the
rules thereunder.
Brokerage commissions incurred during the fiscal year ended September 30,
1996 aggregated $31,168 for the Fund, not including the gross underwriting
spread on securities purchased in underwritten public offerings, all of
which was paid to Dreher. As noted above, GBGS has agreed to use its best
efforts to continue to execute Fund agency trades with Dreher. It is
expected that a significant portion of the Fund's portfolio transactions
would continue to be executed through Dreher.
PRINCIPAL SHAREHOLDERS. At May 31, 1997, no person was known by the Trust
to own beneficially five percent or more of the outstanding shares of the
Fund, as determined in accordance with Rule 13d-3 under the Securities
Exchange Act of 1934.
SOLICITATION OF PROXIES. Proxies will be solicited by the board of
trustees, and the cost of solicitation will be paid by GBGS. Additional
solicitation may be made by mail, personal interview, telephone and
telegraph by IFS, Dreher or GBGS personnel who will not be additionally
compensated therefor.
SHAREHOLDER PROPOSALS. The Trust does not intend to hold regular annual or
special meetings of shareholders unless required by the 1940 Act.
Therefore, the date of the next meeting, if any, is not known.
ANNUAL REPORT. The Trust's annual report to shareholders for the fiscal
year ended September 30, 1996 has been previously mailed to shareholders.
Any shareholder who desires an additional copy of the annual report (or the
more recent semi-annual report) may obtain it upon request (without charge)
from the office of the Trust, One Oakbrook Terrace, Suite 708, Oakbrook
Terrace, Illinois 60181 or by calling (630) 932-3000.
12
<PAGE>
<PAGE>
QUORUM, VOTING. Each valid proxy will be voted in accordance with the
instructions on the proxy and as the persons named in the proxy determine
on such other business as may come before the meeting. If no instructions
are given, the proxy will be voted FOR items 1 and 2. Voting instructions
given by telephone or electronically transmitted instruments may be counted
if obtained pursuant to procedures designed to verify that such
instructions have been authorized.
Item 1 (election of trustees) requires a plurality vote of the shares of
the Trust. This means that the four nominees receiving the largest number
of votes will be elected.
Item 2 (approval of the new investment advisory agreement) requires the
affirmative vote of a "majority of the outstanding voting securities" as
defined in the 1940 Act, meaning: the affirmative vote of the lesser of (1)
67% of the voting securities of the Fund present at the meeting if more
than 50% of the outstanding shares of the Fund are present in person or by
proxy or (2) more than 50% of the outstanding shares of the fund.
A majority of the shares of the Trust entitled to vote shall be a quorum
for the transaction of business at the meeting. If, by the time of the
meeting, a quorum of shareholders of the Trust is not present or if a quorum is
present but sufficient votes in favor of any of the items are not received,
the persons named as proxies may propose one or more adjournments of the
meeting to permit further soliciting of proxies from the shareholders. Any
such adjournment would require an affirmative vote of the majority of the
shares of the Trust voted at the sessions of the meeting to be adjourned.
The persons named as proxies will vote in favor of any such adjournment if
they determine that such adjournment and additional solicitation are
reasonable and in the interest of the shareholders of the Trust.
In tallying shareholder votes, abstentions and "broker non-votes" (i.e.
shares held by brokers or nominees as to which (i) instructions have not
been received from the beneficial owners or person entitled to vote and
(ii) the broker or nominee does not have discretionary voting power on a
particular matter) will be counted for purposes of determining whether a
quorum is present for purposes of convening the meeting. On Item 1,
abstentions and broker non-votes will have no effect; the four nominees
receiving the largest number of votes will be elected. On Item 2,
abstentions and broker non-votes will be considered to be both present at
the meeting and issued and outstanding and, as a result, will have the
effect of being counted as voted against the Item.
PLEASE COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY.
BY ORDER OF THE BOARD OF TRUSTEES:
LINDA M. KOZAK
Secretary
13
<PAGE>
<PAGE>
EXHIBIT A
---------
INVESTMENT ADVISORY AGREEMENT
----------------------------
GRAVER, BOKHOF, GOODWIN & SULLIVAN, a registered investment adviser
(the "Adviser"), a limited partnership organized under the laws of the
State of Illinois and having its principal office and place of business in
Chicago, Illinois (the "Adviser"), and UNIVERSAL CAPITAL INVESTMENT TRUST,
a Massachusetts business trust registered as an open-end management
investment company under the Investment Company Act of 1940 (the "1940
Act") and having its principal office and place of business in Chicago,
Illinois (the "Trust"), hereby agree as follows:
1. APPOINTMENT OF ADVISER.
(a) Initial Fund. The Trust appoints the Adviser to act as
manager and investment adviser to Universal Capital Growth Fund
(the "Fund"), a series of the Trust, for the period and on the
terms herein set forth. The Adviser accepts such appointment
and agrees to render the services herein set forth, for the
compensation herein provided.
(b) Additional Funds. If the Trust establishes one or more
series of shares other than the Fund with respect to which it
wishes to retain the Adviser to render management and
investment advisory services hereunder, it shall notify the
Adviser in writing, indicating the advisory fee which will be
payable with respect to the additional series of shares. If
the Adviser is willing to render such services, it shall notify
the Trust in writing, whereupon such series of shares shall
become a Fund hereunder.
2. DUTIES OF ADVISER.
The Adviser, at its own expense, shall furnish the following services
and facilities to the Trust:
(a) Investment Program. The Adviser will (i) furnish
continuously an investment program of the Fund, (ii) determine
(subject to the overall supervision and review of the Board of
Trustees of the Trust (the "Trustees")) what investments shall
be purchased, held, sold or exchanged by the Fund and what
portion, if any, of the assets of the Fund shall be held
uninvested, and (iii) make changes on behalf of the Trust in
the investments of the Fund. The Adviser will also manage,
supervise and conduct the other affairs and business of the
Trust and the Fund and matters incidental thereto, subject
always to the control of the Trustees and to the provisions of
the Declaration of Trust and Bylaws and the 1940 Act.
(b) Office Space and Facilities. The Adviser shall furnish
the Trust office space in the offices of the Adviser, or in
such other place or places as may be agreed upon from time to
time, and all necessary office facilities, simple business
equipment, supplies, utilities, and telephone service for
managing the affairs and investments of the Trust. These
services are exclusive of the necessary services and records of
any dividend disbursing agent, transfer agent, registrar,
custodian or fund accounting agent.
A-1
<PAGE>
<PAGE>
(c) Personnel. The Adviser shall provide all necessary
executive and clerical personnel for administering the affairs
of the Trust and shall compensate the Trustees and all
personnel and officers of the Trust if such persons are also
employees of the Adviser or its affiliates, except as provided
in Paragraph 3(g) hereof.
(d) Portfolio Transactions. The Adviser shall place all
orders for the purchase and sale of portfolio securities for
the account of the Fund with brokers or dealers selected by the
Adviser, although the Fund will pay the actual brokerage
commissions on portfolio transactions in accordance with
Paragraph 3(d). In executing portfolio transactions and
selecting brokers or dealers, the Adviser will use its best
efforts to seek on behalf of the Trust or the Fund the best
overall terms available for any transaction. The Adviser shall
consider all factors it deems relevant, including the breadth
of the market in the security, the price of the security, the
financial condition and execution capability of the broker or
dealer, and the reasonableness of the commission, if any (for
the specific transaction and on a continuing basis).
To the extent contemplated by the Trust's registration
statement under the 1933 Act, in evaluating the best overall
terms available, and in selecting the broker or dealer to
execute a particular transaction, the Adviser may also consider
the brokerage and research services (as those terms are defined
in Section 28(e) of the Securities Exchange Act of 1934)
provided to the Fund and/or other accounts over which the
Adviser or an affiliate of the Adviser exercises investment
discretion. Consistent with the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. and subject to
seeking the most favorable combination of net price and
execution available, the Adviser may consider sales of shares
of a Fund as a factor in the selection of broker-dealers to
execute portfolio transactions for the Fund. The Adviser is
authorized to pay to a broker or dealer who provides such
brokerage and research services a commission for executing a
portfolio transaction for the Fund which is in excess of the
amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the
Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer, viewed in
terms of that particular transaction or in terms of all of the
accounts over which investment discretion is so exercised.
The Adviser (or an affiliate of the Adviser) may act as
broker for Trust in connection with the purchase or sale of
securities by or to Trust if and to the extent permitted by
procedures adopted from time to time by the Trustees. Such
brokerage services are not within the scope of the duties of
the Adviser under this agreement, and, within the limits
permitted by law and the Trustees, the Adviser (or an affiliate
of the Adviser) may receive brokerage commissions, fees or
other remuneration from Trust for such services in addition to
its fee for services as Adviser.
(e) Other Services. Within the limits permitted by law, the
Adviser may receive compensation from the Trust for other
services performed by it for the Trust which are not within the
scope of the duties of the Adviser under this agreement.
A-2
<PAGE>
<PAGE>
3. ALLOCATION OF EXPENSES.
Except for the services and facilities to be provided by the Adviser
as set forth in Paragraph 2 above, the Trust assumes and shall pay all
expenses for all other Trust operations and activities and shall reimburse
the Adviser for any such expenses incurred by the Adviser. The expenses to
be borne by the Trust shall include, without limitation:
(a) the charges and expenses of any registrar, stock
transfer or dividend disbursing agent, custodian or depository
appointed by the Trust for the safekeeping of its cash,
portfolio securities and other property or agent performing
fund accounting services;
(b) payments under the Trust's distribution plan or plans
adopted pursuant to rule 12b-1 under the 1940 Act;
(c) the charges and expenses of independent auditors;
(d) brokerage commissions and any other costs incurred for
transactions in the portfolio securities of the Trust;
(e) all taxes, including issuance and transfer taxes, and
corporate fees payable by the Trust to Federal, state or other
governmental agencies;
(f) the cost of stock certificates (if any) representing
shares of the Trust;
(g) expenses involved in registering and maintaining
registrations of the Trust and of its shares with the
Securities and Exchange Commission and various states and other
jurisdictions, including reimbursements of actual expenses
incurred by the Adviser in performing such functions for the
Trust and including compensation of employees of the Adviser in
proportion to the time spent on such matters;
(h) all expenses of shareholders' and Trustees' meetings,
including meetings of committees and of preparing, printing and
mailing proxy statements, quarterly reports, semi-annual
reports, annual reports and other communications to
shareholders (but not expenses of printing and mailing any such
documents used for promotional purposes);
(i) all expenses of preparing and setting in type
prospectuses, and expenses of printing and mailing the same to
shareholders (but not expenses of printing and mailing of
prospectuses and literature used for promotional purposes);
(j) compensation and travel expenses of Trustees who are not
"interested persons" within the meaning of the 1940 Act;
(k) the expense of furnishing, or causing to be furnished, to
each shareholder a statement of the shareholder's account,
including the expense of mailing;
(l) charges and expenses of legal counsel in connection with
matters relating to the Trust, including, without limitation,
legal services rendered in connection with the Trust's
corporate and financial structure and relations with its
shareholders, issuance of Trust shares and registration and
qualification of securities under Federal, state and other
laws;
A-3
<PAGE>
<PAGE>
(m) the expenses of attendance at professional meetings of
organizations such as the Investment Company Institute by the
Trustees and officers of the Trust, and the membership or
association dues of such organizations;
(n) the cost and expense of maintaining the books and records
of the Trust, including general ledger accounting;
(o) the expense of obtaining and maintaining insurance
including a fidelity bond as required by Section 17(g) of the
1940 Act;
(p) interest payable on Trust borrowings; and
(q) postage.
4. ADVISORY FEE.
(a) For the services and facilities to be provided to the
Fund by the Adviser as provided in Paragraph 2 hereof, the
Trust shall pay the Adviser a monthly fee with respect to the
Fund as soon as practical after the last day of each calendar
month, which fee shall be paid at the rate set forth below
based upon the Monthly Average Net Assets (as defined in
subparagraph (c) below) of the Fund for such calendar month:
<TABLE>
<CAPTION>
ADVISORY FEE SCHEDULE
Monthly Average Monthly
Net Assets Fee Rate
--------------- --------
<S> <C>
Up to and including $250 million 1/12 of 1.00%
Over $250 million 1/12 of .75%
</TABLE>
(b) In the case of termination of this Agreement during any
calendar month, the fee for that month shall be reduced
proportionately based upon the number of calendar days during
which it is in effect and the fee shall be computed upon the
average net assets of the Fund for the business days during
which it is so in effect.
(c) The "Monthly Average Net Assets" of the Fund for any
calendar month shall be equal to the quotient produced by
dividing (i) the sum of the net assets of the Fund, determined
in accordance with procedures established from time to time by
or under the direction of the Trustees in accordance with the
Agreement and Declaration of Trust of the Trust, as of the
close of business on each day during such month that the Fund
was open for business, by (ii) the number of such days.
5. EXPENSE LIMITATION.
The Adviser agrees that for any fiscal year of the Trust during which
the total of all expenses of the Fund (including investment advisory fees
under this agreement, but excluding interest, portfolio brokerage
commissions and expenses, taxes and extraordinary items) exceeds the lowest
expense limitation imposed in any state in which the Fund is then making
sales of its shares or in which its shares are then qualified for sale, the
A-4
<PAGE>
<PAGE>
Adviser will reimburse the Fund for such expenses not otherwise excluded
from reimbursement by this Paragraph 5 to the extent that they exceed such
expense limitation.
6. TRUST TRANSACTIONS.
The Adviser agrees that neither it nor any of its officers or
directors will take any long or short position in the shares of the Trust;
provided, however, that such prohibition:
(a) shall not prevent the Adviser from purchasing shares of
the Trust if orders to purchase such shares are placed upon the
receipt by the Adviser of purchase orders for such shares and
are not in excess of such purchase orders received by the
Adviser; and
(b) shall not prevent the purchase of shares of the Trust by
any of the persons above described for their account and for
investment.
7. RELATIONS WITH TRUST.
Subject to and in accordance with the Agreement and Declaration of
Trust and Bylaws of the Trust and the Articles of Incorporation and Bylaws
of the Adviser, respectively, it is understood that the Trustees, officers,
agents and shareholders of the Trust are or may be interested in the
Adviser (or any successor thereof) as directors, officers, or otherwise,
that directors, officers, agents and shareholders of the Adviser are or may
be interested in the Trust as Trustees, officers, shareholders or
otherwise, and that the effect of any such adverse interests shall be
governed by the Agreement and Declaration of Trust, Articles of
Incorporation and Bylaws.
8. LIABILITY OF ADVISER AND OFFICERS AND TRUSTEES OF THE TRUST
No provision of this Agreement shall be deemed to protect the Adviser
against any liability to the Trust or its shareholders to which it might
otherwise be subject by reason of any willful misfeasance, bad faith or
gross negligence in the performance of its duties or the reckless disregard
of its obligations and duties under this Agreement. Nor shall any
provision hereof be deemed to protect any Trustee or officer of the Trust
against any such liability to which he might otherwise be subject by reason
of any willful misfeasance, bad faith, gross negligence or reckless
disregard of his obligations and duties. If any provision of this
Agreement shall be held or made invalid by a court decision, statute, rule
or otherwise the remainder of this Agreement shall not be affected thereby.
9. DURATION AND TERMINATION OF THIS AGREEMENT.
(a) Duration. This Agreement shall become effective on the
date hereof. Unless terminated as herein provided, this
Agreement shall remain in full force and effect until March 31,
1999 and shall continue in full force and effect for successive
periods of one year thereafter so long as such continuance is
approved at least annually (i) by either the Trustees or by
vote of a majority of the outstanding voting shares (as defined
in the 1940 Act) of the Fund, and (ii) in either event by the
vote of a majority of the Trustees who are not parties to this
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.
Any approval of this Agreement by the holders of a
majority of the outstanding shares (as defined in the 1940
A-5
<PAGE>
<PAGE>
Act) of the Fund shall be effective to continue this Agreement
notwithstanding that this Agreement has not been approved by
the vote of a majority of the outstanding shares of the Trust,
unless such approval shall be required by any other applicable
law or otherwise.
(b) Termination. This Agreement may be terminated at any
time, without payment of any penalty, by vote of the Trustees
or by vote of a majority of the outstanding shares (as defined
in the 1940 Act) of the Fund, or by the Adviser on sixty (60)
days' written notice to the other party.
(c) Automatic Termination. This Agreement shall
automatically and immediately terminate in the event of its
assignment.
10. SERVICES NOT EXCLUSIVE.
The services of the Adviser to the Trust hereunder are not to be
deemed exclusive, and the Adviser shall be free to render similar services
to others so long as its services hereunder are not impaired thereby.
11. LIMITATION OF LIABILITY.
The obligations of the Trust hereunder shall not be binding upon any
of the Trustees, shareholders, nominees, officers, agents or employees of
the Trust, personally, but shall bind only the assets and property of the
Trust as provided in the Agreement and Declaration of Trust of the Trust.
The execution and delivery of this Agreement have been authorized by the
Trustees and shareholders of the Trust and signed by an authorized officer
of the Trust, acting as such, and neither such authorization by the
Trustees and shareholders nor such execution and delivery by such officer
shall be deemed to have been made by any of them individually or to impose
any liability on any of them personally, but shall bind only the assets and
property of the Trust as provided in its Declaration of Trust.
IN WITNESS WHEREOF, this Investment Advisory Agreement has been
executed for the Adviser and the Trust by their duly authorized officers,
as of the _____ day of ____________, 1997.
GRAVER, BOKHOF, GOODWIN & SULLIVAN
By:_______________________________
Andrew J. Goodwin, Partner
UNIVERSAL CAPITAL INVESTMENT TRUST
By:_______________________________
__________________, President
A-6
<PAGE>
<PAGE>
In order to vote your shares, please sign and date this card and return it
in the envelope provided. By returning this card, you authorize the
proxies to vote on each proposal as marked, or, if not marked, as
indicated.
UNIVERSAL CAPITAL GROWTH FUND
SPECIAL MEETING OF SHAREHOLDERS OF AUGUST 13, 1997
PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The Board of Trustees recommends voting "FOR" the election of trustees and
"FOR" proposal 2.
(1) For election as trustees, the nominees are:
(A) Andrew J. Goodwin, III (B) William J. Breen (C) Robert F. Seebeck
(D) Alan L. Zable
To vote for all nominees, mark an "X" in the "For All" box. To withhold
authority for any individual nominee, mark an "X" in the box marked "for
all except," and mark another "X" in the appropriate nominee's box. To
withhold authority on all nominees, mark an "X" in the "withhold all" box.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FOR ALL WITHHOLD ALL FOR ALL EXCEPT (A) (B) (C) (D)
( ) ( ) ( ) 1 ( ) ( ) ( ) ( )
FOR AGAINST ABSTAIN Approval of the new investment
advisory agreement with Graver,
( ) ( ) ( ) 2 Bokhof, Goodwin & Sullivan
</TABLE>
(Continued on Reverse Side -- Sign on Reverse Side)
<PAGE>
<PAGE>
(Continued from other side)
By signing and dating this card, you
authorize James A. Dreher, Patricia
M. Ellington and Linda M. Kozak or
any of them, each with the power of
substitution to vote your shares of
the fund at the scheduled meeting of
shareholders of the fund and at any
adjournment of the meeting. THEY
SHALL VOTE AS RECOMMENDED BY THE
BOARD, UNLESS OTHERWISE INDICATED,
AND IN THEIR DISCRETION UPON SUCH
OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING.
x___________________________________
x___________________________________
Dated__________________, 1997
Please sign name or names as
they appear to authorize the
voting of your shares as
indicated. Where shares are
registered with joint owners,
all joint owners should sign.
Persons signing as executors,
administrators, trustees,
etc., should so indicate.
