SCHEDULE 14-A
(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
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 14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MAPLEWOOD 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-(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:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11 (a) (2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no. :
(3) Filing party:
(4) Date filed:
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MAPLEWOOD INVESTMENT TRUST, A SERIES COMPANY
312 Walnut Street 21st floor
Cincinnati, Ohio 45202
Dear Shareholder:
You are invited to attend a Special Meeting of Shareholders of the Regional
Opportunity Fund: Ohio, Indiana, Kentucky, to be held at the office of Dunhill
Investment Advisors, Ltd., 700 Pete Rose Way #127, Cincinnati Ohio 45203, at
10:30 a. m. on June 29, 1998.
At this meeting, you are being asked to consider and approve an Agreement and
Plan of Reorganization (the "Plan") providing for the transfer of the assets of
your Fund to a newly-created investment company (the "New Series").
The reorganization is being proposed by Fund management as a result of
management's desire to restructure the administration of the Fund. Specifically,
management wishes to retain Dunhill Investment Advisors, Ltd, a newly formed
organization, to provide investment management, administrative, transfer agency
and shareholder services to the Fund.
If the reorganization is approved by shareholders of the Fund, Dunhill
Investment Advisors, Ltd. will oversee the investment role in conjunction with
CityFund Advisory, Inc., who will remain as the investment adviser directly
managing the Fund.
The possibility of a transaction to reorganize your Fund into the New Series was
first presented to the Fund's Board of Trustees on December 12, 1997. Upon
CityFund Advisory, Inc.'s request and upon reviewing alternative courses of
action, the Trustees approved the reorganization on May 1, 1998. The Fund will
continue to be managed by CityFund Advisory, Inc.
As part of the transaction, each shareholder of your Fund will receive shares of
the New Series which have the same aggregate value as the shares you own in the
Fund immediately prior to the reorganization. Details of the proposed
reorganization, which is intended to be tax-free, are described in the Proxy
Statement. Please give this your prompt attention.
The Fund's Board of Trustees approved the Plan on May 1, 1998 and recommends
that shareholders of your Fund approve the transfer to the New Series. If, for
any reason, the proposed reorganization is not consummated, the Board of
Trustees of the Fund will have to consider other alternatives.
WE ASK YOU TO TAKE THE TIME TO CONSIDER THIS IMPORTANT MATTER AND VOTE NOW.
IN ORDER TO MAKE SURE THAT YOUR VOTE IS REPRESENTED, PLEASE INDICATE YOUR
VOTE ON THE ENCLOSED PROXY CARD AND DATE, SIGN AND RETURN IT IN THE
ENCLOSED ENVELOPE.
Your prompt response will ensure that your shares are counted at the meeting.
Every vote counts! If you later find that you are able to attend the meeting in
person, you may revoke your proxy at the meeting and vote in person.
We are appreciative of your past support of the Fund. CityFund Advisory, Inc.
believes that this transaction serves your interests well and will maintain the
same investment strategies, has greater potential to build the asset base, and
will deliver the same, and in some cases more, convenient administrative
services in the future.
Sincerely,
/s/ John F. Splain
John F. Splain
Secretary
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REGIONAL OPPORTUNITY FUND:
Ohio, Indiana, Kentucky
SPECIAL MEETING OF SHAREHOLDERS
JUNE 29, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The undersigned hereby appoints Jasen M. Snelling and John F. Splain, and each
of them, as Proxies with power of substitution and hereby authorizes each of
them to represent and to vote as provided on the reverse side, all shares of
beneficial interest of the Regional Opportunity Fund: Ohio, Indiana, Kentucky
(the "Fund") which the undersigned is entitled to vote at the special meeting of
shareholders to be held on June 29, 1998 or at any adjournment thereof.
The undersigned acknowledges receipt of the Notice of Special Meeting and Proxy
Statement dated May 16, 1998.
Date: _____________________________________
Note: Please sign exactly as your name
appears on this Proxy. If signing for
an estate, trust or corporation,
title or capacity should be stated.
If the shares are held jointly, both
shareholders should sign, although
the signature of one will bind the
other.
_____________________________________
_____________________________________
Signature(s) PLEASE SIGN IN BOX ABOVE
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PLEASE INDICATE YOUR VOTE BY MARKING AN "X" IN THE APPROPRIATE BOXES BELOW.
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE PROPOSAL DESCRIBED
HEREIN.
1. With respect to approval of an Agreement and Plan of Reorganization (the
"Plan") to reorganize the Fund into a newly-created investment company (the
"New Series"), a vote for approval of the Plan will authorize your Fund, as
the sole shareholder of the New Series prior to the reorganization, to
approve (a) the proposed Management Agreement for the New Series with
Dunhill Investment Advisors, Ltd; (b) the proposed Investment Advisory
Agreement for the New Series with CityFund Advisory, Inc.; and (c) the
proposed Plan of Distribution for the shares of the New Series.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
2. In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting.
PLEASE MARK YOUR PROXY, DATE AND SIGN IT ON THE REVERSE SIDE, AND RETURN IT
PROMPTLY IN THE ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES.
<PAGE>
MAPLEWOOD INVESTMENT TRUST, A SERIES COMPANY
REGIONAL OPPORTUNITY FUND: OHIO, INDIANA, KENTUCKY
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 29, 1998
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NOTICE IS HEREBY GIVEN that a special meeting of shareholders of the
Regional Opportunity Fund: Ohio, Indiana, Kentucky (the "Fund"), a series of
Maplewood Investment Trust, will be held at the office of Dunhill Investment
Advisors, Ltd., 700 W. Pete Rose Way #217, Cincinnati, OH 45203 on June 29, 1998
at 10:30 a.m., Eastern Daylight Time, to consider and vote on the following
matters:
1. To approve or disapprove an Agreement and Plan of Reorganization (the
"Plan") to reorganize the Fund into a newly-created investment company (the
"New Series"). vote for approval of the Plan will authorize your Fund, as
the sole shareholder of the New Series prior to the reorganization, to
approve (a) the proposed Management Agreement for the New Series with
Dunhill Investment Advisors, Ltd. (the "Manager"); (b) the proposed
Investment Advisory Agreement for the New Series with CityFund Advisory,
Inc. (the Advisor"); and (c) the proposed Plan of Distribution for the
shares of the New Series.
2. To transact any other business, not currently contemplated, that may
properly come before the meeting in the discretion of the proxies or their
substitutes.
Shareholders of record at the close of business on May 1, 1998 are entitled
to notice of and to vote at this meeting or any adjournment thereof.
By order of the Board of Trustees,
/s/ John F. Splain
John F. Splain
Secretary
May 16, 1998
- --------------------------------------------------------------------------------
PLEASE EXECUTE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE, THUS AVOIDING UNNECESSARY EXPENSE AND DELAY. NO POSTAGE IS REQUIRED IF
MAILED IN THE UNITED STATES. THE PROXY IS REVOCABLE AND WILL NOT AFFECT YOUR
RIGHT TO VOTE IN PERSON IF YOU ATTEND THE MEETING.
<PAGE>
MAPLEWOOD INVESTMENT TRUST, A SERIES COMPANY
SPECIAL MEETING OF SHAREHOLDERS OF
THE REGIONAL OPPORTUNITY FUND: OHIO, INDIANA, KENTUCKY
TO BE HELD ON JUNE 29, 1998
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PROXY STATEMENT
- --------------------------------------------------------------------------------
This proxy statement is furnished in connection with the solicitation by the
Board of Trustees of Maplewood Investment Trust (the "Trust") of proxies for use
at the special meeting of shareholders or at any adjournment thereof. The proxy
statement and form of proxy were first mailed to shareholders on or about May
22, 1998.
The purpose of the meeting is to consider approval of the reorganization of the
Fund into the Regional Opportunity Fund: Ohio, Indiana, Kentucky series of
Dunhill Investment Trust (the "New Series") and to transact such other business
as may properly come before the meeting or any adjournment thereof.
A proxy, if properly executed, duly returned and not revoked, will be voted in
accordance with the specifications therein. A proxy which is properly executed
that has no voting instructions with respect to a proposal will be voted for
that proposal. A shareholder may revoke a proxy at any time prior to use by
filing with the Secretary of the Trust an instrument revoking the proxy, by
submitting a proxy bearing a later date, or by attending and voting at the
meeting.
The cost of the solicitation, including the printing and mailing of the proxy
materials, will be borne by the Manager or an affiliate of the Manager. In
addition to solicitation through the mail, proxies may be solicited by officers,
employees and agents of the Fund without cost to the Fund. Such solicitation may
be by telephone, facsimile or otherwise. The Advisor will reimburse brokers,
custodians, nominees and fiduciaries for the reasonable expenses incurred by
them in connection with forwarding solicitation material to the beneficial
owners of shares held of record by such persons.
THE FUND'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED FEBRUARY 28, 1998 IS
AVAILABLE AT NO CHARGE BY WRITING TO THE TRUST AT 312 WALNUT STREET, 21ST FLOOR,
CINCINNATI, OHIO 45202- 4094, OR BY CALLING THE TRUST AT (800) 543-0407.
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OUTSTANDING SHARES AND VOTING REQUIREMENTS
The Board of Trustees has fixed the close of business on May 1 , 1998 as the
record date for the determination of shareholders entitled to notice of and to
vote at the special meeting of shareholders of any adjournment thereof. As of
the record date there were 367,129.621 shares of beneficial interest, no par
value, of the Fund outstanding. All full shares of the Fund are entitled to one
vote, with proportionate voting for fractional shares.
No person owned of record and, according to information available to the Trust,
no person owned beneficially, 5% or more of the Fund's outstanding shares on the
record date.
The vote of a majority of the outstanding shares of the Fund is required for
approval of the reorganization of the Fund into the New Series. The vote of a
majority of the outstanding shares means the vote of the lesser of (1) 67% or
more of the shares present or represented by proxy at the meeting, if the
holders of more than 50% of the outstanding shares are present or represented by
proxy, or (2) more than 50% of the outstanding shares.
If the meeting is called to order but a quorum is not represented at the
meeting, the persons named as proxies may vote those proxies which have been
received to adjourn the meeting to a later date. If a quorum is present at the
meeting but sufficient votes to approve the proposal described herein are not
received, the persons named as proxies may propose one or more adjournments of
the meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of a majority of those shares represented at the
meeting in person or by proxy. The persons named as proxies will vote those
proxies received which voted in favor of a proposal in favor of such an
adjournment and will vote those proxies received which voted against a proposal
against any such adjournment. Abstentions and "broker non-votes" are counted for
purposes of determining whether a quorum is present but do not represent votes
cast with respect to a proposal. "Broker non-votes" are shares held by a broker
or nominee for which an executed proxy is received by the Fund, but are not
voted as to one or more proposals because instructions have not been received
from the beneficial owners or persons entitled to vote and the broker or nominee
does not have discretionary voting power.
The trustees of the Trust intend to vote all of their shares in favor of the
proposals described herein. All trustees and officers as a group owned of record
or beneficially less than 1% of the Fund's outstanding shares on the record
date.
1. APPROVAL OR DISAPPROVAL OF THE REORGANIZATION
On May 1, 1998, the Board of Trustees, including a majority of the Trustees who
are not interested persons, as defined in the Investment Company Act of 1940, as
amended (the "1940 Act"), of Dunhill Investment Advisors, Ltd. (the "Manager"),
CityFund Advisory, Inc. (the "Advisor"), or the Trust (the "Independent
Trustees"), approved an Agreement and Plan of Reorganization (the "Plan") which
provides for the reorganization (the "Reorganization") of the Fund into the New
Series. The New Series does not currently have any assets; it is a shell fund
which is being registered as a series of Dunhill Investment Trust for the sole
purpose of receiving the assets of the Fund. The New Series has the same
investment objectives, policies and restrictions as the Fund. The New Series
initially will have a Board of Trustees consisting of three members. One of the
trustees, Christopher J. Smith, is currently a trustee of the Trust. (See
"Information about the Reorganization-Trustees of the New Series and -
Information about the Fund and the New Series.")
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The New Series has been organized and registered for the purpose of continuing
the investment operations of the Fund. Because of the continuation of investment
operations, and to avoid the need to call another shareholders' meeting after
the Reorganization, shareholders of the Fund are also being asked to authorize
the Fund, as the sole shareholder of the New Series prior to the Reorganization,
to approve the proposed Management Agreement for the New Series, the proposed
Investment Advisory Agreement for the New Series and the proposed Distribution
Plan for the New Series. A vote in favor of the Reorganization is also a vote to
authorize the Fund to take such actions. In the event the Reorganization is not
approved by the shareholders of the Fund, the Board of Trustees of the Fund will
consider what other course of action, if any, should be taken with respect to
the Fund, which could include the adoption of a plan to liquidate the Fund.
INFORMATION ABOUT THE REORGANIZATION
The following summary of the Plan does not purport to be complete, and is
subject in all respects to the provisions of, and is qualified in its entirety
by reference to, the Plan, a copy of which is annexed hereto as Exhibit A.
METHOD OF CARRYING OUT THE REORGANIZATION. If the shareholders of the Fund
approve the Plan, the Reorganization will be consummated promptly after the
various conditions to the obligations of each of the parties are satisfied. (See
"Conditions Precedent to Closing.") The date of consummation of the
reorganization (the "Closing Date") will be June 29, 1998 or such other date as
is agreed to by the Fund and the New Series.
On the Closing Date, the Fund will transfer all of its assets in exchange for
the assumption of all of its liabilities by the New Series and for an identical
number of shares of the New Series having an aggregate net asset value equal to
the aggregate value of the Fund's assets transferred to the New Series as of the
close of business on the New York Stock Exchange on the business day next
preceding the Closing Date (the "Calculation Date"). The stock transfer books of
the Fund will be permanently closed as of the close of business on the
Calculation Date and only redemption requests received in proper form prior to
the close of trading on the New York Stock Exchange on the Calculation Date will
be accepted by the Fund.
Redemption requests thereafter received by the Fund shall be deemed to be
redemption requests for shares of the New Series to be distributed to the former
shareholders of the Fund.
CONDITIONS PRECEDENT TO CLOSING. The obligation of the Fund to transfer its
assets to the New Series pursuant to the Plan is subject to the satisfaction of
certain conditions precedent, including performance by the New Series of all the
acts and undertakings required to be performed under the Plan, the receipt of
certain documents from the New Series, the receipt of an opinion of counsel to
the New Series, and the receipt of all consents, orders and permits necessary to
consummate the Reorganization and the Manager's, or an affiliate's, payment of
all expenses associated with the Reorganization on or prior to the Closing Date.
The New Series' obligation to consummate the Reorganization is subject to
performance by the Fund of all acts and undertakings to be performed under the
Plan. The obligations of both parties are subject to the receipt of approval and
authorization of the Plan by vote of not less than a majority of the outstanding
shares of the Fund.
EXPENSES OF THE TRANSACTION. The Manager and/or its affiliates will bear all of
the expenses of the Reorganization and termination of the Fund.
FEDERAL INCOME TAX CONSIDERATIONS. The consummation of the Reorganization is
subject to the condition that the Fund receive an opinion from counsel stating
that for federal income tax purposes: (i) the transfer of all of the assets of
the Fund to the New Series in exchange for the assumption of all
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of the liabilities of the Fund by the New Series, the delivery to the Fund of
the New Series' shares, the distribution by the Fund pro rata to its
shareholders of the New Series' shares and the termination of the Fund, pursuant
to the Plan, will constitute a reorganization within the meaning of Section
368(a)(1) of the Internal Revenue Code of 1986, as amended; (ii) the Fund will
not recognize any gain or loss as a result of the Reorganization; (iii) the New
Series will not recognize any gain or loss on the receipt of the assets of the
Fund in exchange for the New Series' shares; (iv) the shareholders of the Fund
will not recognize any gain or loss on the exchange of their shares of the Fund
for the New Series' shares; (v) the aggregate tax basis of the New Series'
shares received by each shareholder of the Fund will be the same as the
aggregate tax basis of the shares of the Fund exchanged therefor; (vi) the New
Series' adjusted tax bases in the assets received from the Fund in the
Reorganization will be the same as the adjusted tax bases of such assets in the
hands of the Fund immediately prior to the Reorganization; (vii) the holding
period of each former shareholder of the Fund in the New Series' shares received
in the Reorganization will include the period for which such shareholder held
his shares of the Fund as a capital asset; and (viii) the New Series' holding
periods in the assets received from the Fund will include the holding periods of
such assets in the hands of the Fund immediately prior to the Reorganization.
The Fund and the New Series have not sought a tax ruling from the Internal
Revenue Service (the "IRS") with respect to the tax aspects of the
Reorganization, but will act in reliance upon the opinion of counsel discussed
in the previous paragraph. Such opinion is not binding on the IRS and does not
preclude the IRS from adopting a contrary position. If for any reason the
Reorganization did not qualify as a tax-free Reorganization for federal income
tax purposes, then the Reorganization would be treated as a taxable asset sale
and purchase. In such event, the Fund would recognize gain or loss on the
transaction measured by the difference between the consideration received by the
Fund and the tax basis of Fund assets; the tax basis of the assets acquired by
the New Series would equal the purchase price plus the amount of any liabilities
transferred to the New Series; and upon distribution of the New Series' shares
in dissolution of the Fund, the shareholders of the Fund would recognize gain or
loss on the disposition of their Fund shares measured by the difference between
the fair market value of the New Series' shares received by them and the basis
of Fund shares held by them. Shareholders should consult their own advisers
concerning the potential tax consequences of the Reorganization to them,
including state and local income tax consequences.
NO COMMISSIONS, SALES LOADS OR OTHER SIMILAR CHARGES WILL BE INCURRED BY
SHAREHOLDERS OF THE FUND IN CONNECTION WITH THE REORGANIZATION.
INDEMNIFICATION AND INSURANCE. The Plan provides that the Manager will indemnify
each trustee of Maplewood to the fullest extent permissible under Massachusetts
law. The Plan also provides that if the insurance policy currently providing
liability insurance for the trustees of Maplewood terminates for any reason
within one year of the Closing Date, the Manager will procure an insurance
policy providing insurance at the current scope and amount of coverage for such
trustees with respect to any indemnification by the Manager pursuant to the Plan
for a term ending on the first anniversary of the Closing Date.
THE PROPOSED MANAGEMENT AGREEMENT. Under the proposed Management Agreement, the
Manager will provide general investment supervisory services to the New Series.
The Manager will provide various management and statistical services, programs
and strategies to the New Series and will oversee the services provided to the
New Series by the Advisor, subject to the supervision of the Board of Trustees.
The Manager will also provide administrative and consulting services to the New
Series, including advice and services for the development of new products and
services for the New Series, the preparation of information and marketing
materials for use in distributing shares of the New Series and other advertising
and promotional services. The Manager will receive from the New
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Series a fee, computed and accrued daily and paid monthly, at an annual rate of
1.20% of the average daily net assets of the New Series. This is the same fee
that the Fund currently pays to the Advisor for investment advisory services.
If the Reorganization is approved by shareholders of the Fund, the Management
Agreement will become effective on the date of the Reorganization. The
Management Agreement provides that it will remain in force for an initial term
of two years, and from year to year thereafter, subject to annual approval by
(a) the Board of Trustees or (b) a vote of a majority (as defined in the 1940
Act) of the outstanding shares of the New Series; provided that in either event
continuance is also approved by a majority of the Independent Trustees by a vote
cast in person at a meeting called for the purpose of voting on such approval.
The Management Agreement may be terminated at any time, on sixty days' written
notice, without the payment of any penalty, by the Board of Trustees, by a vote
of a majority of the outstanding voting securities of the New Series or by the
Manager. The Management Agreement automatically terminates in the event of its
assignment, as defined in the 1940 Act and the rules thereunder.
The Management Agreement provides that the Manager shall be held harmless and
indemnified by the New Series for any error of judgment, mistake of law or for
any other loss whatsoever suffered in connection with the performance of the
Management Agreement, except a loss resulting from breach of fiduciary duty with
respect to the receipt of compensation for services or a losses resulting from
willful misfeasance, bad faith or gross negligence on the part of the Manager in
the performance of its duties or from reckless disregard by it of its
obligations and duties under the Management Agreement.
INFORMATION CONCERNING THE MANAGER. The Manager is a newly organized Ohio
limited liability company and a registered investment adviser, located at 700
West Pete Rose Way #127, Cincinnati, Ohio 45203. The Manager is owned by Jasen
M. Snelling, Bryan E. Pifer, William C. Riffle and Jerry A. Smith, each of whom
own 25% of the issued and outstanding shares of the Manager. The Manager has no
previous experience in providing investment management services to registered
investment companies.
The managing members of the Manager are Jasen M. Snelling and Bryan E. Pifer.
Jasen M. Snelling is the President and a controlling shareholder of the Advisor
and Mr. Pifer is a principal of Alpha-Omega Capital Corp., the Fund's principal
underwriter; thus, the Manager is deemed to be an affiliate of both the Advisor
and Alpha-Omega Capital Corp.
THE PROPOSED ADVISORY AGREEMENT. The Advisor currently provides investment
advisory services to the Fund pursuant to an Investment Advisory Agreement
between the Trust and the Advisor (the "Present Advisory Agreement"). The
Present Advisory Agreement became effective on the date the Fund's registration
became effective with the Securities and Exchange Commission and was approved by
the Advisor, as the Fund's sole shareholder, on October 24, 1994. The Present
Advisory Agreement was last approved by the Board of Trustees, including a
majority of the Independent Trustees, on October 20, 1997.
The Advisor is controlled by Jasen M. Snelling, who is President of the Advisor,
and Jerry A. Smith, who is Secretary and Treasurer of the Advisor. Mr. Snelling
and his wife together own of record 60% of the issued and outstanding shares of
the Advisor and Mr. Smith owns of record 40% of the issued and outstanding
shares of the Advisor.
5
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If the Reorganization is approved by shareholders of the Fund, the Manager will
become a named party to a new investment advisory agreement (the "New Advisory
Agreement") with the Advisor. Under the New Advisory Agreement, the Manager,
rather than the New Series, will pay the Advisor its fee for providing
investment advisory services to the New Series. There will be no change in the
rate of the overall rate of advisory fees paid by the Fund, which is currently
at the annual rate of 1.20% of the average daily net assets of the Fund.
However, under the proposed new arrangement, the New Series' investment advisory
fee will be paid to the Manager, and the Manager will be responsible for
compensating the Advisor out of such fee.
The terms and conditions of the New Advisory Agreement are substantially
identical in all material respects to those of the Present Advisory Agreement,
except for the following changes:
(1) The New Advisory Agreement has a different effective date and
termination date.
(2) The Manager has been added as a named party to the New Advisory
Agreement because it will be responsible for the overall supervision
of the Advisor's activities and the payment of fees to the Advisor.
(3) The New Advisory Agreement provides that the investment advisory fee
payable to the Advisor will be paid by the Manager, rather than by the
Fund as is provided for in the Present Advisory Agreement. Pursuant to
the Management Agreement, the New Series will pay an investment
advisory fee to the Manager equal to an annual rate or 1.20% of the
average daily net assets of the New Series. This is the same fee
currently paid by the Fund to the Advisor under the Present Advisory
Agreement. Under the New Advisory Agreement, the Manager will be
required to pay a portion of such advisory fee (at the annual rate of
.35% of the New Series' average daily net assets) to the Advisor.
(4) The New Advisory Agreement does not contain a provision requiring the
New Series to obtain consent from the Advisor prior to registering the
New Series in such states which impose expense limitation on mutual
funds. This language has not been provided for in the New Advisory
Agreement because of the enactment, in October 1996, of the National
Securities Markets Improvement Act of 1996, which eliminates
substantive state regulation of mutual funds.
(5) The New Advisory Agreement provides that it will be construed in
accordance with and governed by the laws of the State of Ohio, rather
than by the laws of the State of North Carolina as is provided for in
the Present Advisory Agreement. The governing law has been changed
since the Advisor and the Manager are each organized and headquartered
in Ohio.
Under the New Advisory Agreement, the Advisor will select portfolio securities
for investment by the New Series, purchase and sell securities for the New
Series, and upon making any purchase or sale decision, place orders for the
execution of such portfolio transactions, all in accordance with the 1940 Act
and any rules thereunder, the supervision and control of the Manager and the
Board of Trustees of the Trust and the investment objectives, policies and
restrictions of the New Series. Under the New Advisory Agreement, the Advisor
will receive from the Manager (not the New Series) a fee, computed and accrued
daily and paid monthly, at an annual rate of .35% of the average daily net
assets of the
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Fund. During the fiscal year ended February 28, 1998, the Fund accrued advisory
fees of $ 34,737; however, the Advisor waived its entire advisory fee and
reimbursed the Fund for $ 52,011 of expenses in order to reduce the operating
expenses of the Fund. The Advisor and the Manager currently intend to waive
their advisory and other fees and reimburse expenses to the extent necessary to
limit total operating expenses to 2.70% of average daily net assets. However,
there is no assurance that any fee waiver or expense reimbursements will
continue in the future.
If the Reorganization is approved by shareholders of the Fund, the New Advisory
Agreement will become effective on the date of the Reorganization. The New
Advisory Agreement provides that it will remain in force for an initial term of
two years, and from year to year thereafter, subject to annual approval by (a)
the Board of Trustees or (b) a vote of a majority (as defined in the 1940 Act)
of the outstanding shares of the New Series; provided that in either event
continuance is also approved by a majority of the Independent Trustees, by a
vote cast in person at a meeting called for the purpose of voting on such
approval. The New Advisory Agreement may be terminated at any time, on sixty
days' written notice, without the payment of any penalty, by the Board of
Trustees or by a vote of a majority of the outstanding voting securities of the
New Series. The New Advisory Agreement automatically terminates in the event of
its assignment, as defined in the 1940 Act and the rules thereunder.
The New Advisory Agreement provides that the Advisor shall be held harmless and
indemnified by the New Series for any error of judgement, mistake of law or for
any other loss whatsoever suffered in connection with the performance of the New
Advisory Agreement, except a loss resulting from breach of fiduciary duty with
respect to the receipt of compensation for services or a loss resulting from
willful misfeasance, bad faith or gross negligence on the part of the Advisor in
the performance of its duties or from reckless disregard by it of its
obligations and duties under the New Advisory Agreement.
DISTRIBUTION OF SHARES. Alpha-Omega Capital Corp. (the "Underwriter"), 700 W.
Rose Way #217, Cincinnati, Ohio 45203, serves as the Fund's principal
underwriter, and will serve in this capacity for the New Series if the
Reorganization is approved. The controlling shareholders of the Underwriter are
William C. Riffle and Bryan E. Pifer.
Shares of both the Fund and the New Series are sold subject to a maximum 5%
contingent deferred sales load.
Pursuant to Rule 12b-1 under the 1940 Act, the New Series will adopt a plan of
distribution (the New Distribution Plan") under which the New Series may
directly incur or reimburse the Underwriter for expenditures to finance any
activity primarily intended to result in the sale of shares of the New Series of
the servicing of shareholder accounts. Expenditures by the New Series pursuant
to the New Distribution Plan may not exceed 1% of its average net assets for
each fiscal year. Such expenditures paid as services fees to any person who
sells shares of the New Series may not exceed .25% of the Fund's average daily
net assets; such expenditures paid for distribution-related activities as an
asset-based sales charge under the New Distribution Plan may not exceed .75% of
the New Series' average daily net assets.
The Fund also has a plan of distribution pursuant to Rule 12b-1 and may incur
distribution-related expenses subject to the same limitations described above
with respect to the New Series. The terms of the New Distribution Plan are
substantially identical in all material respects to those of the current
distribution plan.
7
<PAGE>
ADMINISTRATION AND OTHER SERVICES. Currently, Countrywide Fund Services, Inc.
("Countrywide"), 312 Walnut Street, 21st Floor, Cincinnati, Ohio 45202,
supervises the administration of all aspects of the Fund's operations. The Fund
pays Countrywide a fee for these services at the annual rate of .15% of the
average value of its daily net assets up to $50 million, .125% of the next $50
million of such assets and .1% of such assets in excess of $100 million per
month. Countrywide is a wholly-owned indirect subsidiary of Countrywide Credit
Industries, Inc., a New York Stock Exchange listed company principally engaged
in the business of residential mortgage lending. Countrywide is also compensated
under separate agreements for providing transfer agent/shareholder services and
accounting services to the Fund.
The New Series will enter into agreements with the Manager whereby the Manager
will provide administration and transfer agent/shareholder services to the New
Series at rates of compensation identical to the fees currently paid by the Fund
to Countrywide. The New Series also intends to retain Fifth Third Bank to
provide it with accounting services currently provided to the Fund by
Countrywide. The compensation payable to Fifth Third Bank to provide accounting
services to the New Series is the same as that currently paid to Countrywide by
the Fund.
TRUSTEES OF THE NEW SERIES. The New Series has a Board of Trustees comprised of
the individuals listed below. Christopher J. Smith is currently a Trustee of the
Fund. The operations of the New Series will continue to be subject to the same
investment objective, restrictions and policies of the Fund and the New Series
will continue to be managed in conformity with such investment objective,
restrictions and policies by the Advisor, subject to the general oversight of
the New Series' Board of Trustees.
PRINCIPAL OCCUPATION
NAME AND ADDRESS AGE DURING THE LAST 5 YEARS
- --------------------------------------------------------------------------------
James L. Saner 47 President and Chief Executive
105 S. Mullberry Street Officer of P.T.C. Bancorp
Batesville, Indiana
Christopher J. Smith 31 President and Chief Executive
867 Thorntree Court Officer of ObjectTiger Ltd.
Bloomfield Hills, Michigan
Jasen M. Snelling * 34 President and Chief Executive
7448 Indian Creek Road Officer of the Manager and Advisor
Cincinnati, Ohio
* "Interested person" of the New Series, as defined by the 1940 Act.
COMPARISON OF FEES AND EXPENSES. The following tables summarize and compare the
fees and expenses of the Fund and the New Series. These tables are intended to
assist shareholders in comparing the various costs and expenses that
shareholders directly or indirectly bear with respect to an investment in the
Fund and those that they can expect to bear directly or indirectly as
shareholders of the New Series. Fees and expenses are based on the Fund's most
recent fiscal year. Actual expenses may be more or less than those set forth
below. In addition, the "Example" set forth below should not be considered a
representation of future expenses, which will vary depending upon actual
investment returns and expenses.
8
<PAGE>
SHAREHOLDER TRANSACTION EXPENSES:
NEW
FUND SERIES
---- ------
Maximum Sales Charge Imposed on Purchases
(As a percentage of offering price).............. None None
Maximum Contingent Deferred Sales Charge
(As a percentage of original purchase price
or redemption proceeds, whichever is
lower).......................................... 5.00% 5.00%
Sales Charge Imposed on Reinvested Dividends........ None None
Redemption Fee...................................... None None
ANNUAL FUND OPERATING EXPENSES: NEW
(As a percentage of average net assets) FUND SERIES
---- ------
Management Fees After Waivers (1)................... .00% .00%
12b-1 Fees (2)...................................... 1.00% 1.00%
Other Expenses After Reimbursements (3)............. 1.69% 1.69%
----- -----
Total Operating Expenses After Waivers
and Reimbursements (3)........................... 2.69% 2.69%
(1) Absent waivers of management fees, such fees would be 1.20%.
(2) Long-term shareholders may pay more than the economic equivalent of the
maximum front-end sales loads permitted by the National Association of
Securities Dealers.
(3) Absent waivers and expense reimbursements, other expenses would be 3.41%
and total operating expenses would be 5.61%.
EXAMPLE:
You would pay the following expenses on a $1,000 investment, assuming 5% annual
return and redemption at the end of the period:
NEW
FUND SERIES
---- ------
1 Year $ 67 $ 67
3 Years 104 104
5 Years 142 142
10 Years 302 302
The purpose of the foregoing tables is to assist investors in understanding the
various costs and expenses that they will bear directly or indirectly. THE
EXAMPLE SHOWN SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES IN THE FUTURE MAY BE GREATER OR LESS THAN THOSE SHOWN.
9
<PAGE>
INFORMATION ABOUT THE FUND AND THE NEW SERIES. Both the Fund and the New Series
are non-diversified series of open-end management investment companies. The
investment objectives, policies and restrictions of the Fund and the New Series
are substantially identical and are described in detail under the caption
"Investment Objective, Investment Policies and Risk Considerations" in their
respective prospectuses. The Manager has no prior experience as a fund
administrator or transfer agent.
The New Series has been organized as a series of Dunhill Investment Trust, an
unincorporated business trust under the laws of the State of Ohio, pursuant to
an Agreement and Declaration of Trust dated March 13, 1998 (the "Trust
Agreement"). Subsequent to the Reorganization, the former shareholders of the
Fund will acquire those rights incident to shareholders of an Ohio business
trust. Shareholders of the New Series are entitled to one vote for each full
share held and fractional votes for fractional shares held. There will normally
be no meetings of shareholders for the purpose of electing Trustees unless and
until such time as less than a majority of the Trustees holding office have been
elected by shareholders. Shares of the New Series are fully paid and
nonassessable when issued and are transferable, but have no preemptive,
conversion or subscription rights. Shares do not have cumulative voting rights.
In the interest of economy and convenience, certificates representing shares of
the New Series are not physically issued. Under Ohio law, shareholders of the
New Series have no personal liability to third persons for the acts or
obligations of the New Series provided that certain filings required by Ohio law
have been made. In addition, the Trust Agreement disclaims shareholder liability
for acts or obligations of the New Series and requires that notice of such
disclaimer be given in each agreement, obligation or instrument entered into or
executed by the New Series. Shareholders of the New Series are entitled to
dividends declared beginning on the day a purchase has been credited to their
account. The New Series will declare and pay dividends from its net investment
income and its net realized capital gains annually.
The Fund is a series of Maplewood Investment Trust, an unincorporated business
trust under the laws of the Commonwealth of Massachusetts, pursuant to an
Amended and Restated Declaration of Trust dated November 1, 1994. Under the
Declaration of Trust of Maplewood Investment Trust and Massachusetts law,
shareholders of the Fund are not entitled to appraisal rights and will be bound
by the terms of the Plan, if approved. Any shareholder of the Fund may, however,
redeem his shares prior to the Closing Date. The rights of shareholders of the
Fund do not differ significantly from the rights of shareholders of the New
Series described in the preceding paragraph. However, under Massachusetts law,
under certain circumstances, shareholders of a Massachusetts business trust
could be deemed to have the same type of personal liability for the obligations
of the Fund as does a partner of a partnership. However, numerous investment
companies registered under the 1940 Act have been formed as Massachusetts
business trusts and the Fund is not aware of an instance where such result has
occurred. In addition, the Declaration of Trust of the Fund disclaims
shareholder liability for acts or obligations of the Fund and requires that
notice of such disclaimer be given in each agreement, obligation or instrument
entered into or executed by the Fund or the Trustees. The Declaration of Trust
also provides for the indemnification out of the Fund's property for all losses
and expenses of any shareholder held personally liable for the obligations of
the Fund. Moreover, it provides that the Fund will, upon request, assume the
defense of any claim made against any shareholder for any act or obligation of
the Fund and satisfy any judgment thereon. As a result, and particularly because
the Fund's assets are readily marketable and ordinarily substantially exceed
liabilities, management of the Fund believes that the risk of shareholder
liability is slight and limited to circumstances in which the Fund itself would
be unable to meet its obligations. Management of the Fund believes that, in view
of the above, the risk of personal liability is remote.
10
<PAGE>
The Fund and the New Series are each subject to the informational requirements
of the Securities Exchange Act of 1934 and the 1940 Act, and in accordance with
those laws will file reports, proxy statements and other information with the
Securities and Exchange Commission. Reports, proxy statements and other
information filed by the Fund and the New Series may be inspected and copied at
the public reference facilities of the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates.
EVALUATION BY THE BOARD OF TRUSTEES. On May 1, 1998, the Board of Trustees,
including a majority of the Independent Trustees, unanimously approved, subject
to the required shareholder approval described herein, the Reorganization and
the Plan.
In making the determination to recommend approval of the Reorganization and the
Plan to shareholders of the Fund, the Board of Trustees, with the assistance of
counsel to the Trust, carefully evaluated information they deemed necessary to
enable them to determine that the Reorganization would not result in the
dilution of the interests of, and would be in the best interests of, the
shareholders of the Fund. The Board of Trustees gave substantial weight to the
Advisor's representations (i) that the responsibilities of the Advisor under the
New Advisory Agreement are the same in all material respects as under the
Present Advisory Agreement; (ii) that the advisory operations of the Advisor and
the level or quality of advisory services provided to the Fund will not be
materially affected as a result of the New Advisory Agreement; (iii) that the
same personnel of the Advisor who currently provide services to the Fund will
continue to do so upon approval of the New Advisory Agreement; (iv) that the
overall advisory fees payable by the New Series will be at the same rate as the
compensation now payable by the Fund; (v) that the Manager or an affiliate will
pay or reimburse the Fund for the expenses incurred in connection with the
shareholders' meeting and the Reorganization; and (vi) that the Manager has
undertaken to waive fees and/or reimburse expenses so that the New Series'
annual expense ratio for a period of two years following the Reorganization will
not exceed 2.70% of average daily net assets. The Board of Trustees believes
that the New Advisory Agreement should benefit shareholders of the Fund and that
the New Series should receive investment advisory services under the New
Advisory Agreement equal or superior to those currently received by the Fund
under the Present Advisory Agreement, with no change in the overall advisory
fees payable by the Fund. The Board of Trustees therefore unanimously recommends
approval of the Reorganization and the Plan by shareholders of the Fund.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS APPROVE THE REORGANIZATION.
11
<PAGE>
II. OTHER BUSINESS
The proxy holders have no present intention of bringing any other matter before
the meeting other than those specifically referred to above or matters in
connection with or for the purpose of effecting the same. Neither the proxy
holders nor the Board of Trustees are aware of any matters which may be
presented by others. If any other business shall properly come before the
meeting, the proxy holders intend to vote thereon in accordance with their best
judgment.
Any shareholder proposal intended to be presented at the next shareholder
meeting must be received by the Trust for inclusion in its Proxy Statement and
form of Proxy relating to such meeting at a reasonable time before the
solicitation of proxies for the meeting is made.
By Order of the Board of Trustees,
/s/ John F. Splain
John F. Splain
Secretary
Date: May 16, 1998
- --------------------------------------------------------------------------------
Please complete, date and sign the enclosed Proxy and return it promptly in the
enclosed reply envelope. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
12
<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (this "Agreement") is made as of
the 1st day of May, 1998 by and among Maplewood Investment Trust, a
Massachusetts business trust ("Maplewood"), for itself and on behalf of its
Regional Opportunity Fund: Ohio, Indiana, Kentucky series (the "Fund"), Dunhill
Investment Trust, an Ohio business trust ("Dunhill"), for itself and on behalf
of its Regional Opportunity Fund: Ohio, Indiana, Kentucky series (the "Successor
Series"), and Dunhill Investment Advisors, Ltd., an Ohio limited liability
company (the "Manager).
In consideration of the mutual promises herein contained, the parties
hereby agree as follows:
1. APPROVAL BY SHAREHOLDERS.
A special meeting of the shareholders of the Fund (the "Meeting") will be
called for the purpose of considering adoption of this Agreement and considering
such other business as may properly come before the Meeting. The agenda for such
Meeting may include such other proposals as the Board of Directors of Maplewood
may deem appropriate.
2. PLAN OF REORGANIZATION.
(i) Subject to the terms and conditions set forth in this Agreement,
the Fund will convey, transfer and deliver to the Successor Series at the
closing provided for in Section 3 (hereinafter called the "Closing") all of the
then-existing assets of the Fund. In consideration thereof, and subject to the
terms and conditions set forth in this Agreement, at the Closing the Successor
Series will (a) assume all of the obligations and liabilities attributable to
the Fund, of whatever kind or nature, whether absolute, accrued, contingent or
otherwise, and whether or not determinable as of the Closing, and (b) deliver to
the Fund a number of full and fractional shares of beneficial interest of the
Successor Series, no par value (the "Shares"), having an aggregate net asset
value ("NAV") equal to the aggregate net asset value of the shares of beneficial
interest of the Fund (as determined in accordance with the Investment Company
Act of 1940, as amended (the "1940 Act") and the Fund's current Prospectus) on
the Closing Date (as defined in Section 3).
(ii) Upon consummation of the transactions described in Section 2(i)
hereof, the Fund will distribute to persons who are shareholders of record of
the Fund at the Closing the Shares received by the Fund pursuant to Section
2(i), such distribution to be made pro rata to the shareholders based upon the
ratio that the percentage of the outstanding shares of the Fund owned by each
shareholder at the Closing bears to the total number of Shares received by the
Fund from the Successor Series. Such distribution will be accomplished by the
establishment of an open account on the stock records of the Successor Series in
the name of each such shareholder of the Fund and setting forth the number of
Shares due such shareholder in accordance with the foregoing. Fractional Shares
will be carried to the third decimal place. Certificates representing Shares
will not be issued.
<PAGE>
(iii) As soon as is reasonably practicable after the Closing,
Maplewood will take all necessary steps under its Amended and Restated
Declaration of Trust and Massachusetts law to effect a complete liquidation and
dissolution of the Fund, at the expense of Manager or an affiliated party.
(iv) The transactions contemplated in this Section 2 are referred to
as the "Reorganization."
3. CLOSING.
The Closing will occur prior to the commencement of business on June 29,
1998 or such other time and date as may be mutually agreed upon by the parties
(the "Closing Date"). In the event that the NAV calculations of the Fund or the
Successor Series are not readily determinable for purposes of the Reorganization
due to market disruption, the Closing shall occur on the next successive
business day.
4. CONDITIONS TO OBLIGATIONS OF MAPLEWOOD AND THE FUND.
The obligations of Maplewood and the Fund in connection with the
consummation of the Reorganization shall be subject to the satisfaction of each
of the following conditions:
(i) Maplewood shall have received the opinion of legal counsel for
Dunhill, satisfactory to Maplewood in all respects, dated as of the Closing Date
and addressed to Maplewood, to the effect that: (a) Dunhill is established as an
Ohio business trust and is validly existing under the laws of the State of Ohio,
(b) Dunhill is an open-end investment company of the management type registered
under the 1940 Act, and the Successor Series is a duly established series of
Dunhill, (c) this Agreement and the Reorganization provided for herein and the
execution and delivery of this Agreement has been duly authorized and approved
by all requisite action of the Board of Trustees of Dunhill and this Agreement
has been duly executed and delivered by Dunhill and is a valid and binding
obligation of Dunhill and the Successor Series, and (d) the Shares to be issued
in the Reorganization will be duly authorized and upon issuance thereof in
accordance with this Agreement will be validly issued, fully paid and
non-assessable Shares of the Successor Series. In rendering such opinion, such
legal counsel may rely on certificates of officers or trustees of Dunhill, in
each case reasonably acceptable to Maplewood.
(ii) Dunhill and the Successor Series shall have complied with each of
their covenants contained herein and each of the representations and warranties
of Dunhill and the Successor Series contained herein shall be true in all
material respects as of the Closing Date, and Dunhill shall have delivered to
Maplewood a certificate from appropriate officers of Dunhill reasonably
acceptable to the Fund to such effect.
(iii) Manager, or an affiliated person of the Manger, shall have paid
all expenses associated with the Reorganization and termination of the Fund on
or prior to the Closing Date.
<PAGE>
5. CONDITION TO OBLIGATIONS OF DUNHILL AND THE SUCCESSOR SERIES.
The obligations of Dunhill and the Successor Series in connection with the
consummation of the Reorganization shall be subject to Maplewood and the Fund's
compliance in all material respects with each of their covenants contained
herein as of the Closing Date.
6. CONDITIONS TO OBLIGATIONS OF MAPLEWOOD AND DUNHILL.
The obligations of Maplewood and Dunhill in connection with the
consummation of the Reorganization shall be subject to the satisfaction of each
of the following conditions:
(i) Maplewood and Dunhill shall have received an opinion of legal
counsel, dated as of the Closing Date, addressed to and in form and substance
satisfactory to Maplewood and Dunhill to the effect that: (a) the transfer of
all of the assets of the Fund to the Successor Series in exchange for the
assumption of all the liabilities of the Fund by the Successor Series, the
delivery to the Fund of shares of the Successor Series, the distribution by the
Fund pro rata to its shareholders of such shares of the Successor Series, and
the termination of such Fund, pursuant to the Plan, will constitute a
reorganization within the meaning of Section 368(a) (1) of the Internal Revenue
Code of 1986, as amended; (b) the Fund will not recognize any gain or loss as a
result of the Reorganization; (c) the Successor Series will not recognize any
gain or loss on the receipt of the assets of the Fund in exchange for shares of
the Successor Series; (d) the shareholders of the Fund will not recognize any
gain or loss on the exchange of their shares of the Fund for shares of the
Successor Series; (e) the aggregate tax basis of the shares of the Successor
Series received by each shareholder of the Fund in the Reorganization will be
the same as the aggregate tax basis of the shares of the Fund exchanged
therefor; (f) the Successor Series' adjusted tax bases in the assets received
from the Fund in the Reorganization will be the same as the adjusted tax bases
of such assets in the hands of the Fund immediately prior to the Reorganization;
(g) the holding period of each former shareholder of the Fund in the shares of
the Successor Series received in the Reorganization will include the period for
which such shareholder held his shares of the Fund as a capital asset; and (h)
the Successor Series' holding periods in the assets received from the Fund in
the Reorganization will include the holding periods of such assets in the hands
of the Fund immediately prior to the Reorganization.
(ii) Such authority, including "no-action" letters and orders from the
Securities and Exchange Commission (the "Commission") and state securities
commissions, as may be necessary to permit the parties to carry out the
transactions contemplated by this Agreement shall have been received.
(iii) The Shares shall have been duly qualified for offering to the
public in such jurisdictions (except where such qualifications are not required)
so as to permit the transfers contemplated by this Agreement to be consummated.
<PAGE>
(iv) This Agreement and the Reorganization and, if necessary, a
temporary amendment of the investment restrictions that might otherwise preclude
the consummation of the Reorganization, shall have been approved by the holders
of the requisite number of shares of beneficial interest of the Fund entitled to
vote on the matter under Maplewood's Amended and Restated Declaration of Trust.
(v) As of the Closing Date, (a) the Commission shall not have issued
an unfavorable advisory report under Section 25(b) of the 1940 Act nor
instituted nor threatened to institute any proceeding seeking to enjoin
consummation of the Reorganization contemplated hereby under Section 25(c) of
the 1940 Act and (b) no other action, suit or other proceeding shall be
threatened or pending before any court or governmental agency which seeks to
restrain or prohibit, or obtain damages or other relief in connection with, this
Agreement or the transactions contemplated herein.
At any time prior to the Closing, any of the foregoing conditions in
Section 4, 5 or 6 may be waived by the Fund or the Successor Series, as the case
may be, if, in the judgment of such party, such waiver will not have a material
adverse effect on the benefits intended under this Agreement to the shareholders
of the Fund or the Successor Series, as the case may be.
7. REPRESENTATIONS AND WARRANTIES OF DUNHILL.
Dunhill, with respect to itself and the Successor Series, represents and
warrants to Maplewood as follows:
(i) Dunhill is a business trust duly organized, validly existing and
in good standing under the laws of the State of Ohio;
(ii) Dunhill is a registered investment company classified as a
management company of the open-end type, and its registration with the
Commission as an investment company under the 1940 Act is in full force and
effect;
(iii) The Successor Series is a duly established series of Dunhill
(iv) Dunhill is not, and the execution, delivery and performance of
this Agreement will not result, in material violation of Dunhill's Agreement and
Declaration of Trust or Bylaws or of any agreement, indenture, instrument,
contract, lease or other undertaking to which Dunhill is a party or is bound;
(v) There is no litigation or administrative proceeding or
investigation of or before any court or governmental body pending or to
Dunhill's knowledge threatened against Dunhill with respect to the Successor
Series or its properties or assets, and Dunhill knows of no fact which might
form the basis for the institution of such proceedings, and neither Dunhill nor
the Successor Series is a party or subject to the provisions of any order,
decree or judgment of any court or governmental body which materially and
adversely affects their respective businesses or their respective abilities to
consummate the transactions contemplated herein;
<PAGE>
(vi) At the Closing all shares of beneficial interest in the Successor
Series will be duly authorized, legally issued, fully paid and non-assessable,
and the Successor Series does not have outstanding any options, warrants or
other rights to subscribe for or purchase any shares of the Successor Series
(other than dividend reinvestment plans of the Successor Series or as set forth
in this Agreement), nor are there outstanding any securities convertible into
any shares of the Successor Series (exception pursuant to exchange privileges
described in the current Prospectus or Registration Statement of the Successor
Series under the 1933 Act);
(vii) Dunhill has full power and authority to enter into and perform
its obligations under this Agreement; the execution, delivery and performance of
this Agreement have been duly authorized by all necessary action on the part of
the Board of Trustees of Dunhill; and this Agreement constitutes a valid and
binding obligation of Dunhill and the Successor Series, enforceable against
Dunhill and the Successor Series in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights and by
equitable principles;
(viii) Dunhill will provide to the Fund the Form N-1A Registration
Statement under the 1933 Act concerning the Successor Series, which does not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make any statements therein, in
light of the circumstances under which such statements were made, not materially
misleading;
(ix) The information to be furnished by Dunhill for use in
registration statements, proxy materials and other documents, in connection with
the transactions contemplated hereby, will be accurate and complete in all
material respects and will comply in all material respects with federal
securities laws and other laws and regulations thereunder applicable thereto;
and
(x) The Proxy Statement to be used in connection with the transactions
contemplated hereby (only insofar as it relates to the Successor Series or
Dunhill), on its effective date and at the Closing, will conform in all material
respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and
the rules and regulations thereunder, and will not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not materially misleading.
8. COVENANTS OF DUNHILL AND THE MANAGER.
Dunhill and the Manager covenant to Maplewood and the Fund as follows:
(i) Dunhill will use its best efforts and take all actions as may be
necessary or advisable to effectuate the Reorganization and to cause to be
registered and continue the Successor Series in operation thereafter, including
the obtaining of any regulatory approvals required to be obtained by it.
<PAGE>
(ii) The Manager agrees to indemnify and advance expenses to each
person who at the time of the execution of this Agreement serves as a trustee or
officer ("Indemnified Person") of Maplewood, against all costs and expenses,
including attorneys' fees, judgments, fines and amounts paid in settlement,
actually and reasonably incurred by such Indemnified Person arising out of such
person's service as a trustee or officer of Maplewood, provided that such
indemnification and advancement of expenses shall be permitted to the fullest
extent that is available under the Massachusetts Business Corporation Law
("MBCL") (which by analogy applies to a business trust) and other applicable
law. This paragraph 9 (ii) shall not protect any such Indemnified Person against
any liability to Maplewood, Dunhill or their shareholders to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or from reckless disregard of the duties involved in the conduct of
his office. An Indemnified Person seeking indemnification shall be entitled to
advances from the Manager for payment of the reasonable expenses incurred by him
in connection with the matter as to which he is seeking indemnification in the
manner and to the fullest extent permissible under the MBCL and other applicable
law. Such Indemnified Person shall provide to the Manager a written affirmation
of his good faith belief that the standard of conduct necessary for
indemnification by the Manager has been met and a written undertaking to repay
any advance if it should ultimately be determined that the standard of conduct
has not been met.
(iii) Dunhill agrees that in the event that it is subsequently
acquired by merger, acquisition or the sale of substantially all of its assets
("Subsequent Merger"), or it reorganizes or changes its domicile ("Subsequent
Redomestication"), it will provide under the terms of such Subsequent Merger or
Subsequent Redomestication that the indemnification provided for above shall
continue in full force and effect for a period of two years following the
effective date of such Subsequent Merger or Subsequent Redomestication. In the
event that Dunhill enters into negotiation for a Subsequent Merger or Subsequent
Redomestication, Dunhill shall promptly notify the Indemnified Person of such
intended Subsequent Merger or Subsequent Redomestication.
(iv) The Manager agrees that in the event the liability insurance
policy currently in place providing insurance for the trustees of Maplewood
terminates for any reason within one year of Closing Date, the Manager will
procure an insurance policy at the current scope and amount of coverage,
providing insurance for such trustees with respect to any indemnification by the
Manager pursuant to this Agreement for a term ending on the first anniversary of
the Closing Date.
9. COVENANTS OF MAPLEWOOD.
Maplewood covenants to Dunhill and the Successor Series as follows:
(i) Maplewood will use its best efforts and take all actions as may be
necessary or advisable to effectuate the Reorganization, including the obtaining
of any regulatory approvals, as may be required to be obtained by it.
<PAGE>
(ii) Except as otherwise contemplated by this Agreement, Maplewood
will use its best efforts to conduct the business of the Fund in the ordinary
course until the consummation of the Reorganization.
(iii) The Fund will duly supplement its Prospectus in the manner
prescribed by Rule 497(e) of the 1933 Act and all other applicable law and
regulations.
10. BROKERAGE FEES AND EXPENSES.
(i) Maplewood represents and warrants to Dunhill, and Dunhill
represents and warrants to Maplewood, that there are no brokers or finders
entitled to receive and payments in connection with the transactions provided
for herein.
(ii) Maplewood and Dunhill confirm their understanding that the
Manager, or an affiliated person of the Manager, will be responsible for all
expenses in connection with the Reorganization, including termination of the
Fund, which must be paid on or before the Closing Date.
11. TERMINATION.
The Board of Trustees of Maplewood may terminate this Agreement and abandon
the Reorganization contemplated hereby at any time prior to the Closing Date,
notwithstanding approval thereof by the shareholders of the Fund if, in the
judgment of such Board, proceeding with the Reorganization would be inadvisable
or if any of the conditions set forth in Sections 4 or 6 hereof have not been
satisfied. In any event, the Board of Trustees of Maplewood may terminate this
Agreement and abandon the Reorganization contemplated hereby at any time prior
to the Closing Date, if shareholders of the Fund who are parties to this
Agreement do not approve this Agreement and Plan of Reorganization. The Board of
Trustees of Dunhill may terminate this Agreement and abandon the Reorganization
contemplated hereby if any of the conditions set forth in Sections 5 or 6 hereof
have not been satisfied. The Boards of Trustees of Maplewood and Dunhill may
also terminate this Agreement and abandon the Reorganization at any time prior
to the Closing Date, if circumstances should develop that, in the opinion of the
respective Boards, make proceeding with the Reorganization inadvisable. In the
event of any such termination, there shall be no liability for damages on the
part of either party to the other, provided that the obligation of the Manager,
or its affiliates, to pay the expenses in connection with the Reorganization
shall continue.
12. ENTIRE AGREEMENT.
This Agreement embodies the entire Agreement between the parties and there
are not agreements, understandings, restrictions or warranties among the parties
other than those set forth herein or herein provided for. This Agreement may not
be amended without the consent in writing of both parties hereto. Furthermore,
after approval of this Agreement by the shareholders of the Fund, no amendments
may be made that materially adversely affect the interests of shareholders of
the Fund unless such amendments are submitted for shareholder approval.
<PAGE>
13. FURTHER ASSURANCES.
Maplewood and Dunhill shall take such further action as may be reasonably
necessary or desirable and proper to consummate the transactions contemplated
hereby.
14. GOVERNING LAW.
This Agreement and the transactions contemplated hereby shall be governed
by and construed and enforced in accordance with the laws of the State of Ohio,
without regard to principles of conflicts of law.
15. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS.
Copies of the Amended and Restated Declaration of Trust of Maplewood and
the Agreement and Declaration of Trust of Dunhill are on file with the Secretary
of State of The Commonwealth of Massachusetts and the State of Ohio,
respectively, and notice is hereby given that each such instrument is executed
on behalf of the trustees of Maplewood and Dunhill, respectively, as trustees
and not individually and that the obligations of each of Maplewood and Dunhill
pursuant to this Agreement and the other agreements contemplated hereby are not
binding upon any of the trustees or shareholders individually but binding only
upon the assets and property of Maplewood and Dunhill, respectively.
16. NOTICES.
All notices, requests, demands and other communications required or
permitted thereunder shall be in writing and deemed properly given if hand
delivered or deposited in the U.S. mail, return receipt requested or certified,
postage prepaid, or with an overnight delivery service, as follows:
a. if to Maplewood:
Maplewood Investment Trust
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202
Attention: John F. Splain, Secretary
and required copies to:
Cors & Bassett
1200 Carew Tower
Cincinnati, Ohio 45202
Attention: Tracy S. Byrd, Esq.
<PAGE>
b. if to Dunhill or the Manager:
Dunhill Investment Advisors, Ltd.
700 W. Pete Rose Way, #127
Cincinnati, Ohio 45203
Attention: Jasen M. Snelling
or to such additional person or other address as Maplewood or Dunhill,
respectively, shall furnish to the other in writing.
IN WITNESS WHEREOF, each of the parties have caused this Agreement and Plan
of Reorganization to be executed on its behalf by its Chairman or President and
attested by its Secretary, all as of the day and year first above written.
Maplewood Investment Trust, for itself and
on behalf of the Fund
By: ________________________________
Name: O. James Peterson II
Title: Chairman
ATTEST:
By: _______________
Name: John F. Splain
Title: Secretary
Dunhill Investment Trust, for itself and
on behalf of the Successor Series
By: ____________________________
Name: Jasen M. Snelling
Title: President
ATTEST:
By: _______________
Name: Jerry A. Smith
Title: Secretary
Dunhill Investment Advisors, Ltd.
By: ___________________________
Name: Jasen M. Snelling
Title: President
ATTEST:
By: _______________
Name: Jerry A. Smith
Title: Secretary
