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:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
TIP Institutional Funds
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
same
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11(1).
1) Title of each class of securities to which transaction applies:
_____________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_____________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
_____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_____________________________________________________________________________
5) Total fee paid:
_____________________________________________________________________________
/_/ Fee paid previously with preliminary 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
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PENN CAPITAL STRATEGIC HIGH YIELD BOND FUND
TURNER MICRO CAP GROWTH FUND
TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO
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IMPORTANT SHAREHOLDER INFORMATION
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THE DOCUMENT YOU HOLD IN YOUR HANDS CONTAINS YOUR PROXY
STATEMENT AND PROXY CARD. A PROXY CARD IS, IN ESSENCE, A
BALLOT. WHEN YOU VOTE YOUR PROXY CARD, IT TELLS US HOW TO
VOTE ON YOUR BEHALF ON IMPORTANT ISSUES RELATING TO YOUR
FUND. IF YOU SIMPLY SIGN THE PROXY CARD WITHOUT SPECIFYING A
VOTE, YOUR SHARES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF TRUSTEES. YOU WILL RECEIVE
ONE PROXY CARD FOR EACH FUND IN WHICH YOU OWN SHARES.
WE URGE YOU TO SPEND A FEW MINUTES WITH THE PROXY STATEMENT,
FILL OUT YOUR PROXY CARD, AND RETURN IT TO US. VOTING YOUR
PROXY, AND DOING SO PROMPTLY, ENSURES THAT YOUR FUND WILL NOT
NEED TO CONDUCT ADDITIONAL MAILINGS. WHEN SHAREHOLDERS DO NOT
RETURN THEIR PROXIES IN SUFFICIENT NUMBERS, WE HAVE TO MAKE
FOLLOW-UP SOLICITATIONS.
PLEASE TAKE A FEW MOMENTS TO EXERCISE YOUR RIGHT TO VOTE.
THANK YOU.
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ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
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ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
PENN CAPITAL STRATEGIC HIGH YIELD BOND FUND
TURNER MICRO CAP GROWTH FUND
TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO
Dear Shareholder:
A Special Meeting of Shareholders of the Penn Capital Strategic High
Yield Bond Fund, Turner Micro Cap Growth Fund, and Turner Short Duration
Government Funds - Three Year Portfolio (each a "Fund" and, together, the
"Funds") of the Alpha Select Funds ("Alpha Select") has been scheduled for
Monday, January 25, 1999. If you are a Shareholder of Record as of the close of
business on Friday, December 11, 1998, you are entitled to vote at the meeting
and for any adjournment of the meeting.
While you are, of course, welcome to join us at the meeting, most
Shareholders will cast their votes by filling out and signing the enclosed Proxy
Card(s). Whether or not you plan to attend the meeting, we need your vote.
Please mark, sign, and date the enclosed Proxy Card(s) and return it promptly in
the enclosed, postage-paid envelope so that the maximum number of shares may be
voted.
The attached Proxy Statement is designed to give you information
relating to the proposal(s) upon which you will be asked to vote. The Board of
Trustees is recommending that you approve a reorganization of the Funds under
which each Fund would be combined with and into a corresponding portfolio of TIP
Funds. Shareholders of each Fund will vote separately. Assuming approval by
Shareholders of each Fund:
(i) each holder of shares of Alpha Select Penn Capital Strategic
High Yield Bond Fund will receive a number of shares of TIP
Funds Penn Capital Strategic High Yield Bond Fund equal in
dollar value and in the number of shares of Alpha Select Penn
Capital Strategic High Yield Bond Fund owned by such holder at
the time of the combination;
(ii) each holder of shares of Alpha Select Turner Micro Cap Growth
Fund will receive a number of shares of TIP Funds Turner Micro
Cap Growth Fund the equal in dollar value and in the number of
shares of Alpha Select Turner Micro Cap Growth Fund owned by
such holder at the time of the combination; and
(iii) each holder of shares of Alpha Select Turner Short Duration
Government Funds - Three Year Portfolio will receive a number
of shares of TIP Funds Turner Short Duration Government Funds
Three Year Portfolio equal in dollar value and in the number
of shares of Alpha Select Turner Short Duration Government
Funds - Three Year Portfolio.
As further explained in the accompanying proxy statement, the Board of
Trustees expects such a combination to result in operational efficiencies. We
encourage you to support the Trustees' recommendation to approve the proposals.
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We are proposing the Reorganization for two principal reasons:
o POTENTIALLY LOWER OPERATING EXPENSES: TIP Funds currently consists of
12 series with substantial assets. Once the Funds are reorganized into
corresponding series of TIP Funds, they will pay lower administrative
and other fees due to the higher asset levels of TIP Funds.
o SYNERGIES WITH THE OTHER TIP FUNDS: Six TIP Funds are currently managed
by Turner Investment Partners, Inc., and two TIP Funds are currently
managed by Penn Capital Management Company, Inc. Having all of the
Turner- and Penn Capital-advised Funds available in a single entity
will facilitate exchanges between the Funds. In addition, it is hoped
that the Funds will achieve operating efficiencies and will realize
economies of scale.
Your vote is important to us. Please do not hesitate to call
1-888-TIP-7654, if you have any questions about the proposals under
consideration. Thank you for taking the time to consider these important
proposals and for your investment in the Funds.
Sincerely,
Stephen Kneeley
President
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INFORMATION ABOUT YOUR PROXY STATEMENT
Q. WHY AM I RECEIVING THIS PROXY STATEMENT?
A. Alpha Select Funds (formerly, TIP Institutional Funds) (the "Trust")
seeks your approval of a reorganization of the Trust's Penn Capital
Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and
Turner Short Duration Government Funds - Three Year Portfolio (the
"Funds"). The Board of Trustees recommends approval of the
reorganization because it believes that it will result in a structure
that more appropriately serves the needs of shareholders.
Q. HOW WILL THE REORGANIZATION WORK?
A. The Penn Capital Strategic High Yield Bond, Turner Micro Cap Growth,
and Turner Short Duration Government Funds - Three Year Portfolio Funds
each will transfer all of their assets and all of their liabilities to
a series of TIP Funds in return for shares of the TIP Funds having an
equivalent aggregate value. The assets of the Trust's Penn Capital
Strategic High Yield Bond, Turner Micro Cap Growth, and Turner Short
Duration Government Funds - Three Year Portfolio Funds will be
transferred at their current value as of the reorganization date, and
the shares provided in return will have a total value equal to the
transferred assets, again as of the reorganization date. Finally, each
of the Penn Capital Strategic High Yield Bond, Turner Micro Cap Growth,
and Turner Short Duration Government Funds - Three Year Portfolio will
distribute the shares received by it to its shareholders in a
liquidating distribution. Shareholders of the Trust's Penn Capital
Strategic High Yield Bond, Turner Micro Cap Growth, Turner Short
Duration Government Funds - Three Year Portfolio Funds will thus
effectively be converted into shareholders of TIP Funds. If the Plan is
carried out as proposed, there will be no federal or state tax
consequences to either Fund or its shareholders.
Please refer to the Proxy Statement for a detailed explanation of the
proposals and for a more complete description of TIP Funds and Alpha
Select Funds.
Q. HOW WILL THIS AFFECT MY ACCOUNT?
A. Following the reorganization, you will be a shareholder of TIP Funds.
The reorganization will not, however, affect the value of your account.
In addition, you can expect the same high level of management expertise
and shareholder services that you currently receive.
Q. WHY DO I NEED TO VOTE?
A. Your vote is needed to ensure that the proposal can be acted upon. Your
immediate response on the enclosed proxy card will help prevent the
need for any further solicitations for a shareholder vote. We encourage
all shareholders to participate.
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Q. HOW DOES THE BOARD OF TRUSTEES SUGGEST THAT I VOTE?
A. After careful consideration, the Board of Trustees of Alpha Select
Funds recommends that you vote "FOR" the item(s) proposed on the
enclosed proxy card(s).
Q. WHO IS PAYING FOR EXPENSES RELATED TO THE SHAREHOLDER MEETING?
A. Turner Investment Partners, Inc., the sponsor of TIP Funds and Alpha
Select Funds, will pay the costs of the solicitation and the
shareholder meeting.
Q. WHERE DO I MAIL MY PROXY CARD?
A. You may use the enclosed postage-paid envelope or mail your proxy card
to:
Alpha Select Funds
c/o ADP
53 Mercedes Way
Edgewood, NY 11717
[YOU MAY ALSO VOTE OVER THE INTERNET OR BY TELEPHONE. PLEASE FOLLOW THE
ENCLOSED INSTRUCTIONS TO UTILIZE THESE METHODS OF VOTING.]
Q. WHOM DO I CALL IF I HAVE QUESTIONS?
A. We will be happy to answer your questions about the proxy solicitation.
Please call us at (888) TIP-7654 between 8:00 a.m. and 5:30 p.m.
Eastern Time, Monday through Friday.
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ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
JANUARY 25, 1999
Notice is hereby given that a Special Meeting of Shareholders (the
"Meeting") of the Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap
Growth Fund, and Turner Short Duration Government Funds - Three Year Portfolio
(each a "Fund" and, together, the "Funds") of the Alpha Select Funds ("Alpha
Select") will be held at the offices of SEI Investments Company ("SEI
Investments"), Oaks, Pennsylvania 19456, on Monday, January 25, 1999 at 3:30
p.m. Eastern time (the "Meeting").
At the Meeting, Shareholders of each Fund will be asked to consider and
act upon a proposed Agreement and Plan of Reorganization and Liquidation
pursuant to which each Fund will transfer all of its assets and liabilities to a
portfolio of TIP Funds with an identical investment objective and comparable
investment policies in exchange for shares of the applicable portfolio. The new
portfolios of TIP Funds designated to acquire the assets and liabilities are
Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and
Turner Short Duration Government Funds - Three Year Portfolio. The proposals,
which are identical for each Fund and which are more fully described in the
attached Proxy Statement, are as follows:
1. PENN CAPITAL STRATEGIC HIGH YIELD BOND FUND:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE PENN CAPITAL STRATEGIC
HIGH YIELD BOND FUND, AND TIP FUNDS, ON BEHALF OF THE PENN CAPITAL
STRATEGIC HIGH YIELD BOND FUND.
2. TURNER MICRO CAP GROWTH FUND:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE TURNER MICRO CAP GROWTH
FUND, AND TIP FUNDS, ON BEHALF OF THE TURNER MICRO CAP GROWTH FUND.
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3. TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE TURNER SHORT DURATION
GOVERNMENT FUNDS - THREE YEAR PORTFOLIO, AND TIP FUNDS, ON BEHALF OF
TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO.
Shareholders of each Fund will vote separately on each Proposal applicable to
them.
The persons named as proxies are authorized to vote on such other
business as may properly come before the Meeting in accordance with their own
discretion.
All Shareholders are cordially invited to attend the Meeting. However,
if you are unable to attend the Meeting, you are requested to mark, sign and
date the enclosed Proxy Card(s) and return it promptly in the enclosed,
postage-paid envelope so that the Meeting may be held and a maximum number of
shares may be voted. [YOU MAY ALSO VOTE OVER THE INTERNET OR BY TELEPHONE.
PLEASE FOLLOW THE ENCLOSED INSTRUCTIONS TO UTILIZE THESE METHODS OF VOTING.]
Shareholders of record at the close of business on Friday, December 11,
1998 are entitled to notice of and to vote at the Meeting or any adjournment
thereof.
BY ORDER OF THE BOARD OF TRUSTEES
JAMES W. JENNINGS, SECRETARY
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ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Trustees of Alpha Select Funds ("Alpha Select") for
use at a Special Meeting of Shareholders to be held on Monday, January 25, 1999
at 3:30 p.m., Eastern time, at the offices of SEI Investments Company ("SEI
Investments"), Oaks, Pennsylvania 19456, and at any adjourned session thereof
(such meeting and any adjournments thereof are hereinafter referred to as the
"Meeting"). Shareholders of Penn Capital Strategic High Yield Bond Fund, Turner
Micro Cap Growth Fund, and Turner Short Duration Government Funds - Three Year
Portfolio (each a "Fund" and, together, the "Funds") of record at the close of
business on Friday, December 11, 1998 ("Shareholders"), are entitled to vote at
the Meeting. As of December 11, 1998, the approximate number of units of
beneficial interest ("shares") issued and outstanding for each of the Funds is
set forth below:
<TABLE>
<CAPTION>
FUNDS SHARES OUTSTANDING
- ----- ------------------
<S> <C>
Penn Capital Strategic High Yield Bond Fund __________________
Turner Micro Cap Growth Fund __________________
Turner Short Duration Government Funds - Three Year Portfolio __________________
</TABLE>
Each share is entitled to one vote and each fractional share is
entitled to a proportionate fractional vote on each matter as to which such
shares are to be voted at the Meeting.
In addition to the solicitation of proxies by mail, Trustees and
officers of Alpha Select, officers and employees of SEI Investments, the
administrator and shareholder servicing agent for Alpha Select, Turner
Investment Partners, Inc. ("Turner"), and Penn Capital Management Company ("Penn
Capital") may solicit proxies in person or by telephone. Employees of SEI
Investments, Turner, and Penn Capital will not be compensated by Alpha Select
for their solicitation activities. Persons holding shares as nominees will, upon
request, be reimbursed for their reasonable expenses incurred in sending
soliciting materials to their principals. The cost of the solicitation and the
shareholder meeting will be borne by Turner. The proxy card(s) and this Proxy
Statement are being mailed to Shareholders on or about Wednesday, December 23,
1998.
Shares represented by duly executed proxies will be voted in accordance
with the instructions given. Proxies may be revoked at any time before they are
exercised by a written revocation received by the President of the Trust at
Oaks, Pennsylvania 19456, by properly executing a later-dated proxy, or by
attending the Meeting and voting in person. [YOU MAY ALSO VOTE OVER THE INTERNET
OR BY TELEPHONE. PLEASE FOLLOW THE ENCLOSED INSTRUCTIONS TO UTILIZE THESE
METHODS OF VOTING.]
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PROPOSALS
1. PENN CAPITAL STRATEGIC HIGH YIELD BOND FUND:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE PENN CAPITAL STRATEGIC
HIGH YIELD BOND FUNDS, AND TIP FUNDS, ON BEHALF OF THE PENN CAPITAL
STRATEGIC HIGH YIELD BOND FUND.
2. TURNER MICRO CAP GROWTH FUND:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE TURNER MICRO CAP GROWTH
FUND, AND TIP FUNDS, ON BEHALF OF THE TURNER MICRO CAP GROWTH FUND.
3. TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO:
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
BETWEEN ALPHA SELECT FUNDS, ON BEHALF OF THE TURNER SHORT DURATION
GOVERNMENT FUNDS - THREE YEAR PORTFOLIO, AND TIP FUNDS, ON BEHALF OF
TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO.
INTRODUCTION
The Meeting is being called in order to permit the Shareholders of the
Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and
Turner Short Duration Government Funds - Three Year Portfolio of Alpha Select to
vote on an Agreement and Plan of Reorganization and Liquidation (the
"Agreement"). Shareholders of each Fund will vote separately on the
transactions. Assuming approval by the Shareholders of each Fund, each Fund will
transfer all of its assets and liabilities to one of four corresponding "shell"
portfolios of TIP Funds in exchange for shares of such portfolios. The
portfolios of TIP Funds are: Penn Capital Strategic High Yield Bond Fund, Turner
Micro Cap Growth Fund, and Turner Short Duration Government Funds - Three Year
Portfolio, (each a "Portfolio" and, together, the "Portfolios").
The Board of Trustees of Alpha Select is recommending that Shareholders
of the Funds approve the Agreement between Alpha Select, on behalf of the Funds,
and TIP Funds, on behalf of the Portfolios. The Agreement provides for the
transfer of all of the assets of each Fund to the corresponding Portfolio in
exchange solely for shares of beneficial interest of such Portfolio and the
assumption by such Portfolio of the liabilities of such Fund and the
distribution of such Portfolio's shares to the Shareholders of such Fund in
liquidation of such Fund (the "Reorganization").
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Once shares of a Portfolio have been distributed to Shareholders of the
corresponding Fund, the such Fund will be liquidated. The Board of Trustees
anticipates that the exchange of assets of the Funds for shares of the
Portfolios will occur on January 27, 1999. A copy of the Agreement is attached
to this Proxy Statement as Exhibit A, and the description of the Agreement in
this Proxy Statement is qualified in its entirety by reference to Exhibit A.
SUMMARY OF THE TRANSACTION
Alpha Select Funds is organized as a Delaware business trust and is not
required to hold annual meetings of Shareholders. The Meeting is being called in
order to permit the Shareholders of the Penn Capital Strategic High Yield Bond
Fund, Turner Micro Cap Growth Fund, and Turner Short Duration Government Funds -
Three Year Portfolio of Alpha Select to vote on an Agreement pursuant to which
each of the Funds will transfer all of its assets and liabilities to one of four
newly-organized Portfolios of TIP Funds in exchange for shares of TIP Funds'
Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and
Turner Short Duration Government Funds - Three Year Portfolio. Once shares of
the TIP Funds Portfolios have been distributed to Shareholders of the Alpha
Select Funds, the Funds will be liquidated. It is currently anticipated that the
Reorganization will occur on January 27, 1999.
DESCRIPTION OF THE AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
The Agreement by and between Alpha Select, on behalf of each of the
Funds, and TIP Funds, on behalf of each of the Portfolios, provides for:
(i) the transfer of all, or substantially all, of the assets of
the Alpha Select Penn Capital Strategic High Yield Bond Fund
solely in exchange for shares of beneficial interest of the
TIP Funds Penn Capital Strategic High Yield Bond Fund and the
assumption by the TIP Funds Penn Capital Strategic High Yield
Bond Fund of all, or substantially all, of the liabilities of
the Alpha Select Penn Capital Strategic High Yield Bond Fund,
followed by the distribution on the closing date of the TIP
Funds Penn Capital Strategic High Yield Bond Fund shares to
the holders of Alpha Select Penn Capital Strategic High Yield
Bond Fund shares;
(ii) the transfer of all, or substantially all, of the assets of
the Alpha Select Turner Micro Cap Growth Fund solely in
exchange for shares of beneficial interest of the TIP Funds
Turner Micro Cap Growth Fund and the assumption by the TIP
Funds Turner Micro Cap Growth Fund of all, or substantially
all, of the liabilities of the Alpha Select Turner Micro Cap
Growth Fund, followed by the distribution on the closing date
of the TIP Funds Turner Micro Cap Growth Fund shares to the
holders of Alpha Select Turner Micro Cap Growth Fund shares;
and
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(iii) the transfer of all, or substantially all, of the assets of
the Alpha Select Turner Short Duration Government Funds -
Three Year Portfolio solely in exchange for shares of
beneficial interest of the TIP Funds Turner Short Duration
Government Funds - Three Year Portfolio and the assumption by
the TIP Funds Turner Short Duration Government Funds - Three
Year Portfolio of all, or substantially all, of the
liabilities of the Alpha Select Turner Short Duration
Government Funds - Three Year Portfolio, followed by the
distribution on the closing date of the TIP Funds Turner Short
Duration Government Funds - Three Year Portfolio shares to the
holders of Alpha Select Turner Short Duration Government
Funds - Three Year Portfolio shares.
On the closing date for the Reorganization, which is anticipated to be
January 27, 1999, if the Funds obtain shareholder approval of the appropriate
proposal for the Reorganization, each Fund will assign, deliver, and otherwise
transfer all of its assets, and assign all or substantially all of its
liabilities, to the corresponding Portfolio free and clear of all liens and
encumbrances, and such Portfolio will acquire all the assets and will assume all
such liabilities of the corresponding Funds in exchange for shares of such
Portfolio. In addition, the Agreement provides that the net asset value per
share of each Fund and of each corresponding Portfolio will be equal and the
number of shares of each Portfolio issued in exchange for shares of the
corresponding Fund will equal the number of shares of such Fund issued and
outstanding at the time of the Reorganization. Thereafter, Alpha Select will
take all necessary and proper steps to effect the complete termination of each
Fund.
The Agreement also provides that TIP Funds will receive, prior to the
closing, an opinion of counsel to the effect that: (i) Alpha Select and the
Funds are duly organized and validly existing under the laws of the Commonwealth
of Delaware; (ii) Alpha Select is an open-end management investment company
registered under the Investment Company Act of 1940 (the "1940 Act"); (iii) the
Agreement and the Reorganization provided for therein and the execution of the
Agreement have been duly authorized and approved by all requisite action of
Alpha Select, and has been duly executed and delivered by Alpha Select on behalf
of the Funds, and is a valid and binding obligation of the Funds, subject to
applicable bankruptcy, insolvency, fraudulent conveyance, and similar laws or
court decisions regarding enforcement of creditors' rights generally; and (iv)
to the best of counsel's knowledge after reasonable inquiry, no consent,
approval, order, or other authorization of any federal or state court or
administrative or regulatory agency is required for Alpha Select to enter into
the Agreement or carry out its terms on behalf of the Funds that has not been
obtained other than where the failure to obtain such consent, approval, order,
or authorization would not have a material adverse affect on the operations of
the Funds.
In addition, Alpha Select shall have received, prior to the closing, an
opinion of counsel to the effect that: (i) TIP Funds and the Portfolios are duly
organized and validly existing under the laws of the Commonwealth of
Massachusetts; (ii) TIP Funds is an open-end management investment company
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registered under the 1940 Act; (iii) the Agreement, the Reorganization provided
for therein, and the execution of the Agreement have been duly authorized and
approved by all requisite corporate action of TIP Funds and the Agreement has
been duly executed and delivered by TIP Funds and is a valid and binding
obligation of TIP Funds, subject to applicable bankruptcy, insolvency,
fraudulent conveyance and similar laws or court decisions regarding enforcement
of creditors' rights generally; (iv) to the best of counsel's knowledge after
reasonable inquiry, no consent, approval, order or other authorization of any
federal or state court or administration or regulatory agency is required for
TIP Funds to enter into the Agreement or carry out its terms on behalf of the
Portfolios that has not already been obtained, other than where the failure to
obtain any such consent, approval, order or authorization would not have a
material adverse effect on the operations of TIP Funds or the Portfolios; and
(v) TIP Funds shares to be issued in the reorganization have been duly
authorized and upon issuance thereof in accordance with the Agreement, will be
validly issued, fully paid and non-assessable.
TAX CONSEQUENCES OF THE REORGANIZATION
At the time of the closing, Alpha Select and TIP Funds shall have
received an opinion of counsel substantially to the effect that for federal
income tax purposes: (1) no gain or loss will be recognized by a Fund upon the
transfer of its assets in exchange solely for the corresponding Portfolio's
shares and the assumption by such Portfolio of that Fund's stated liabilities;
(2) no gain or loss will be recognized by a Portfolio on its receipt of a Fund's
assets in exchange for that Portfolio's shares and the assumption by that
Portfolio of such Fund's liabilities; (3) the basis of a Fund's assets in a
Portfolio's hands will be the same as the basis of those assets in that Fund's
hands immediately before the conversion; (4) a Portfolio's holding period for
the assets transferred to the Portfolio by a Fund will include the holding
period of those assets in the Fund's hands immediately before the conversion;
(5) no gain or loss will be recognized by a Fund on the distribution of a
Portfolio's shares to that Fund's shareholders in exchange for their shares of
the Fund; (6) no gain or loss will be recognized to a shareholder of a Fund as a
result of the Fund's distribution of a Portfolio's shares to that Fund's
shareholders in exchange for the Fund's shareholder's shares of the Fund; (7)
the basis of a Portfolio's shares received by a Fund's shareholders will be the
same as the adjusted basis of that Fund's shareholders' shares of the Fund
surrendered in exchange therefor; and (8) the holding period of a Portfolio's
shares received by a Fund's shareholders will include the Fund's shareholders'
holding period for the Fund's shareholders' shares of the Fund surrendered in
exchange therefor, provided that the Fund's shares were held as capital assets
on the date of the conversion.
The Reorganization is expected to qualify as a "reorganization" within
the meaning of Section 368(a)(1)(F) of the Internal Revenue Code of 1986, as
amended (the "Code"), with each of the Portfolios and the Funds being "parties
to a reorganization" within the meaning of Section 368(b) of the Code. As a
consequence, the Reorganization will be tax-free for each of the Portfolios, the
Funds and their respective Shareholders.
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DESCRIPTION OF ALPHA SELECT FUNDS AND THE FUNDS
Alpha Select was organized under Delaware law as a business trust
pursuant to a Declaration of Trust dated October 25, 1993, and amended on
September 7, 1998. Alpha Select is an open-end management investment company
registered under the 1940 Act, and has authorized capital consisting of an
unlimited number of units of beneficial interest without par value of separate
series. Each of the Funds is a duly organized and validly existing series of
Alpha Select.
The Penn Capital Strategic High Yield Bond Fund seeks to maximize
income through high current yield and, as a secondary objective, to produce
above average capital appreciation. The Fund invests primarily in a diversified
portfolio of high yield bonds.
The Turner Micro Cap Growth Fund seeks capital appreciation. It invests
primarily in a diversified portfolio of common stocks of issuers with market
capitalizations of not more than $500 million at the time of purchase that the
Adviser believes offer strong earnings growth potential.
The Turner Short Duration Government Funds - Three Year Portfolio seeks
maximum total return consistent with preservation of capital and prudent
investment management. The Fund invests primarily in attractively priced
obligations either issued or guaranteed by the U.S. Government, its agencies and
instrumentalities. Moreover, the Fund seeks to limit fluctuations and principal
and reduce interest rate risk by maintaining average effective durations no
greater than those of three-year U.S. Treasury notes. Effective duration is an
indicator of a security's volatility or risk associated with changes in interest
rates.
Turner serves as investment adviser to each Fund (except the Penn
Capital Strategic High Yield Bond Fund) pursuant to investment advisory
agreements dated January 1, 1998, and March 1, 1998 (each, an "Advisory
Agreement"). The Funds' Advisory Agreements with Turner provides, in part, that
Turner makes investment decisions for the assets of the Funds it advises and
continuously reviews, supervises and administers such Funds' investment
programs, subject to the supervision of, and policies established by, the
Trustees of the Trust. For its services, Turner is entitled to a fee, which is
calculated daily and paid monthly, at an annual rate of 1.00%, the average daily
net assets of the Turner Micro Cap Growth Fund, and .25% of Turner Short
Duration Government Funds - Three Year Portfolio.
Penn Capital serves as investment adviser to the Penn Capital Strategic
High Yield Bond Fund pursuant to an investment advisory agreement dated March 1,
1998 (the "Penn Advisory Agreement"). The Penn Advisory Agreement provides in
part, that Penn Capital makes investment decisions for the assets of the Penn
Capital Strategic High Yield Bond Fund and continuously reviews, supervises and
administers the Fund's investment program, subject to the supervision of, and
policies established by, the Trustees of the Trust. For its services, Penn
Capital is entitled to a fee, which is calculated daily, and paid monthly at the
annual rate of .55% of the average daily net assets of the Penn Capital
Strategic High Yield Bond Fund.
6
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Turner has voluntarily agreed to waive all or a portion of its fees and
to reimburse expenses of the Turner Micro Cap Growth Fund, and Turner Short
Duration Government Funds - Three Year Portfolio, in order to limit their total
operating expenses (as a percentage of average daily net assets on an annualized
basis) to not more than 1.25% and .36% (.61% for the Adviser Class Shares),
respectively. Penn Capital has voluntarily agreed to waive all or a portion of
its fees and to reimburse expenses of the Penn Capital Strategic High Yield Bond
Fund in order to limit its total operating expenses (as a percentage of average
daily net assets on an annualized basis) to not more than .68% (.93% for Adviser
Class Shares). Turner and Penn Capital reserve the right, in their sole
discretion, to terminate these voluntary fee waivers and reimbursements at any
time. Absent these fee waivers and expense reimbursements, the total operating
expenses of the Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap
Growth Fund, and Turner Short Duration Government Funds - Three Year Portfolio,
during the most recent fiscal year would have been %, %, and %,
respectively.
DESCRIPTION OF TIP FUNDS AND THE PORTFOLIOS
TIP Funds was organized under Massachusetts law as a business trust
pursuant to an Agreement and Declaration of Trust dated January 26, 1996, as
amended and restated on February 21, 1997. TIP Funds is an open-end management
investment company registered under the 1940 Act which has authorized capital
consisting of an unlimited number of units of beneficial interest, each with a
par value of $.00001, of each of the separate series of TIP Funds. The Penn
Capital Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and Turner
Short Duration Government Funds - Three Year Portfolio, are each duly organized
and validly existing series of TIP Funds.
The Strategic High Yield Bond Fund seeks to maximize income through
high current yield and, as a secondary objective, to produce above average
capital appreciation. The Fund invests primarily in a diversified portfolio of
high yield bonds.
The Micro Cap Growth Fund seeks capital appreciation. It invests
primarily in a diversified portfolio of common stocks of issuers with market
capitalizations of not more than $500 million at the time of purchase that the
Adviser believes offer strong earnings growth potential.
The Turner Short Duration Government Funds - Three Year Portfolio seeks
maximum total return consistent with preservation of capital and prudent
investment management. The Fund invests primarily in attractively priced
obligations either issued or guaranteed by the U.S. Government, its agencies and
instrumentalities. Moreover, the Fund seeks to limit fluctuations and principal
and reduce interest rate risk by maintaining average effective durations no
greater than those of three-year U.S. Treasury notes.
Following the conclusion of the reorganization, Turner and Penn Capital
will serve as investment advisers to the corresponding series of TIP Funds. The
investment advisory agreements between Turner and Penn Capital and TIP Funds are
substantially identical to the advisory agreements that exist between Turner and
Penn Capital and Alpha Select, on behalf of the Funds. Significantly, the
investment advisory agreements provide for the same fees, duties, and standards
of care.
7
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Turner will serve as investment adviser to each Fund (except the Penn
Capital Strategic High Yield Bond Fund) pursuant to an investment advisory
agreement which provides, in part, that Turner makes investment decisions for
the assets of the Funds it advises and continuously reviews, supervises and
administers such Funds' investment programs, subject to the supervision of, and
policies established by, the Trustees of the Trust. For its services, Turner is
entitled to a fee, which is calculated daily and paid monthly, at an annual rate
of 1.00%, the average daily net assets of the Turner Micro Cap Growth Fund, and
.25% of Turner Short Duration Government Funds - Three Year Portfolio.
Penn Capital will serve as investment adviser to the Penn Capital
Strategic High Yield Bond Fund pursuant to an investment advisory agreement
which provides in part, that Penn Capital makes investment decisions for the
assets of the Penn Capital Strategic High Yield Bond Fund and continuously
reviews, supervises and administers the Fund's investment program, subject to
the supervision of, and policies established by, the Trustees of the Trust. For
its services, Penn Capital is entitled to a fee, which is calculated daily, and
paid monthly at the annual rate of .55% of the average daily net assets of the
Penn Capital Strategic High Yield Bond Fund.
Turner has voluntarily agreed to waive all or a portion of its fees and
to reimburse expenses of the Turner Micro Cap Growth Fund, and Turner Short
Duration Government Funds - Three Year Portfolio, in order to limit their total
operating expenses (as a percentage of average daily net assets on an annualized
basis) to not more than 1.25% and .36% (.61% for Adviser Class Shares),
respectively. Penn Capital has voluntarily agreed to waive all or a portion of
its fees and to reimburse expenses of the Penn Capital Strategic High Yield Bond
Fund in order to limit its total operating expenses (as a percentage of average
daily net assets on an annualized basis) to not more than .68% (.93% for Adviser
Class Shares). Turner and Penn Capital reserve the right, in their sole
discretion, to terminate these voluntary fee waivers and reimbursements at any
time.
The tables below set forth comparative fee information (after waivers
and reimbursements) for both the Funds and the Portfolios:
8
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<TABLE>
<CAPTION>
====================================================================================================================
Alpha Select TIP Funds
Penn Capital Strategic High Penn Capital Strategic High
Yield Bond Fund(1) Yield Bond Fund(2)
====================================================================================================================
<S> <C> <C>
Advisory Fees (after fee waivers) .55% .55%
- --------------------------------------------------------------------------------------------------------------------
Other Expenses .13% .13%
- --------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (after .68% .68%
fee waivers)
====================================================================================================================
<CAPTION>
====================================================================================================================
Alpha Select TIP Funds
Turner Micro Cap Growth Turner Micro Cap Growth
Fund(1) Fund(2)
====================================================================================================================
<S> <C> <C>
Advisory Fees (after fee waivers) 1.00% 1.00%
- --------------------------------------------------------------------------------------------------------------------
Other Expenses (after expense .25% .25%
reimbursements)
- --------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (after fee 1.25% 1.25%
waivers and expense reimbursements)
====================================================================================================================
<CAPTION>
====================================================================================================================
Alpha Select TIP Funds
Turner Short Duration Turner Short Duration
Government Funds - Three Year Government Funds - Three Year
Portfolio(1) Portfolio(2)
====================================================================================================================
<S> <C> <C>
Advisory Fees (after fee waivers) .25% .25%
- --------------------------------------------------------------------------------------------------------------------
Other Expenses (after expense .36% .36%
reimbursements)
- --------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (after fee .61% .61%
waivers and expense reimbursements)
====================================================================================================================
</TABLE>
(1) The "Advisory Fees" and "Other Expenses" shown reflect current
voluntary waivers and/or reimbursements by Turner Partners. Absent such
waivers and/or reimbursements, "Advisory Fees" for the Penn Capital
Strategic High Yield Bond Fund, Turner Micro Cap Growth Fund, and the
Turner Short Duration Government Funds - Three Year Portfolio would be
.68%, .33%, and .64%, respectively; "Other Expenses" would be .55%,
1.00% and .25%, respectively; and "Total Operating Expenses" would be,
1.13%, 1.33% and .89%, respectively.
9
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(2) Turner and Penn Capital have agreed for the first year of the Funds'
operations, on a voluntary basis, to waive its advisory fee for the
Penn Capital Strategic High Yield Bond Fund, Turner Micro Cap Growth
Fund, and the Turner Short Duration Government Funds - Three Years
Portfolio to the extent necessary to keep the "Total Operating
Expenses" of the Funds from exceeding .68%, 1.25% and .61%,
respectively. Turner and Penn Capital reserve the right to terminate
its waivers at any time in its sole discretion. Absent such waivers
and/or reimbursements, "Advisory Fees" for the Penn Capital Strategic
High Yield Bond Fund, Turner Micro Cap Growth Fund, and the Turner
Short Duration Government Funds - Three Year Portfolio would be .55%,
1.00% and .25%, respectively, and "Total Operating Expenses" would be
1.13%, 1.33% and .89%, respectively.
REASONS FOR THE REORGANIZATION
Turner has served as investment adviser to the Turner Micro Cap Growth
Fund since its inception. In addition, Turner and its predecessor have served as
adviser to the Turner Short Duration Government Funds - Three Year Portfolio
since its inception. Penn Capital has served as adviser to the Penn Capital
Strategic High Yield Bond Fund since its inception. In the interests of
obtaining increased efficiencies relating to investment management and
operational issues, Turner determined to propose to the Alpha Select Trustees
and to the Funds' Shareholders, the transfer of the assets of the Funds, into
newly-organized Portfolios of TIP Funds. Each of the Portfolios has an
investment objective identical and comparable investment policies to that of its
corresponding Fund. It is believed that the total operating expenses of TIP
Funds and each of its Portfolios (after fee waivers) will be equal to or lower
than that of the corresponding Fund of Alpha Select. Specifically, the Trustees
of Alpha Select are proposing the Reorganization for two principal reasons:
o POTENTIALLY LOWER OPERATING EXPENSES: TIP Funds currently consists of
12 series with substantial assets. Once the Funds are reorganized into
corresponding series of TIP Funds, they will pay lower administrative
and other fees due to the higher asset levels of TIP Funds.
o SYNERGIES WITH THE OTHER TIP FUNDS: Six TIP Funds are currently managed
by Turner Investment Partners, Inc., and two TIP Funds are currently
managed by Penn Capital Management Company, Inc. Having all of the
Turner- and Penn Capital-advised Funds available in a single entity
will facilitate exchanges between the Funds. In addition, it is hoped
that the Funds will achieve operating efficiencies and will realize
economies of scale.
CONSIDERATIONS OF THE TRUSTEES OF THE ALPHA SELECT FUND
At a Meeting held on November 4, 1998, the Trustees of Alpha Select
reviewed the Agreement and determined that the Reorganization is in the best
interests of the Funds and the Funds' Shareholders, and that the interests of
the Funds' Shareholders will not be diluted as a result of the Reorganization.
10
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In making this determination, the Trustees carefully reviewed the terms
and provisions of the Agreement, the substantial similarity of the objectives,
policies and restrictions of the Funds and the corresponding Portfolios, the tax
consequences of the Reorganization to the Funds and their Shareholders, and the
expense ratios of the Funds and the Portfolios. In addition, the Trustees
considered the performance of the Funds since their inception, the nature and
quality of the services expected to be rendered to the Portfolios by Turner and
Penn Capital, as well as the services provided by Turner and Penn Capital to the
Funds, the fact that the compensation payable to Turner and Penn Capital will be
the same for the Funds as for the Portfolios, the history, reputation,
qualification and background of Turner and Penn Capital and the qualifications
of their personnel and their financial condition, and the benefits expected to
be realized by the Shareholders of the Funds as a result of the Reorganization,
including the potential efficiencies and economies of scale discussed in
"Reasons for the Reorganization."
After careful review and consideration, the Trustees have determined to
recommend that the Shareholders of the Funds approve the Agreement and the
Reorganization transaction. If this recommendation is not adopted by
Shareholders of a Fund, the Reorganization will be effectuated with respect to
any approving Fund, and any non-approving Fund will continue to operate in the
same manner as prior to the proposed Reorganization.
COMPARISON OF THE INVESTMENT OBJECTIVES AND POLICIES OF THE FUNDS AND THE
PORTFOLIOS
Each of the newly organized Portfolios of TIP Funds has an investment
objective that is identical to the investment objective of each corresponding
Fund of Alpha Select. The TIP Funds Turner Short Duration Government Funds -
Three Year Portfolio, however, has slightly increased investment flexibility.
DESPITE THIS INCREASED FLEXIBILITY, HOWEVER, IT IS NOT ANTICIPATED THAT THE
ACTUAL INVESTMENT STRATEGIES THAT WILL BE EMPLOYED BY TURNER FOR NEWLY-CREATED
TURNER SHORT DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO WILL BE MATERIALLY
DIFFERENT THAN THOSE TURNER HAS EMPLOYED FOR THE ALREADY-EXISTING TURNER SHORT
DURATION GOVERNMENT FUNDS - THREE YEAR PORTFOLIO.
As mentioned above, the existing Turner Short Duration Government
Funds - Three Year Portfolio will have an increased investment flexibility,
despite the fact that Turner has no present intention of changing the investment
strategy of the Portfolio. This increased investment flexibility, however, will
allow Turner to engage in certain additional types of transactions if market
conditions so warrant. For example, the Portfolio will have slightly increased
flexibility to borrow money for temporary defensive purposes and to lend a
slightly higher percentage of its assets to third parties. While these
investment techniques give the Portfolio more flexibility, Turner has no present
intention of engaging in investment techniques that are different from the
techniques currently utilized by the Fund.
11
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In addition, the Alpha Select Funds and TIP Funds each have a different
Board of Trustees. However, the Funds have the same administrator, custodian,
distributor and transfer agent as the Alpha Select Funds, as well as the same
principal executive officers. PLEASE SEE "ADDITIONAL INFORMATION ABOUT ALPHA
SELECT FUNDS AND OTHER MATTERS."
INVESTMENT ADVISORY INFORMATION
Turner Investment Partners, Inc., is a professional investment
management firm founded in March, 1990. Robert E. Turner is the Chairman and
controlling shareholder of Turner. As of August 1, 1998, Turner had
discretionary management authority with respect to approximately $3 billion of
assets. Turner has provided investment advisory services to investment companies
since 1992, and currently advises six portfolios of TIP Funds. The principal
business address of Turner is 1235 Westlakes Drive, Suite 350, Berwyn,
Pennsylvania 19312.
Turner serves as the investment adviser for the Alpha Select Turner
Micro Cap Fund, and Turner Short Duration Government Funds - Three Year
Portfolio under an investment advisory agreement. Under the advisory agreement,
Turner continuously reviews, supervises and administers these Funds' investment
programs, subject to the supervision of, and policies established by, the
Trustees of the Trust. The same portfolio management personnel will manage the
TIP Funds Turner Micro Cap Fund, and Turner Short Duration Government Funds -
Three Year Portfolio.
Penn Capital Management Company, Inc., 52 Haddonfield-Berlin Road,
Suite 1000, Cherry Hill, New Jersey 08034, is a professional investment
management firm founded in 1987 and registered as an investment adviser under
the Investment Advisers Act. Richard A. Hocker is a founding partner and Chief
Investment Officer of Penn Capital, an investment management firm that manages
the investment portfolios of institutions and high net worth individuals and
which currently has assets under management of approximately $350 million. Penn
Capital also serves as adviser to two portfolios of TIP Funds.
Penn Capital serves as the investment adviser for the Alpha Select Penn
Capital Strategic High Yield Bond Fund under an investment advisory agreement.
Under the advisory agreement, Penn Capital continuously reviews, supervises and
administers the Fund's investment program, subject to the supervision of, and
policies established by, the Trustees of the Trust. The same portfolio
management personnel will manage the TIP Funds Penn Capital Strategic High Yield
Bond Fund.
THE TRUSTEES RECOMMEND THAT THE SHAREHOLDERS OF THE ALPHA
SELECT FUNDS VOTE FOR THE PROPOSALS TO APPROVE THE AGREEMENT
AND PLAN OF REORGANIZATION AND LIQUIDATION.
12
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SHAREHOLDER RIGHTS
GENERAL. Alpha Select Funds was established as a business trust under Delaware
law by a Declaration of Trust dated October 25, 1993, and amended and restated
on September 7, 1998. The Fund is also governed by its By-Laws and by applicable
Delaware law.
TIP Funds was established as a business trust under Massachusetts law by a
Declaration of Trust dated January 26, 1996, and amended and restated as of
February 21, 1997. The Fund is also governed by its By-Laws and by applicable
Massachusetts law.
SHARES. Alpha Select Funds is authorized to issue an unlimited number shares of
beneficial interest, with no par value, from an unlimited number of series
(portfolios) of shares. The shares of each Alpha Select Fund have no preference
as to conversion, exchange, dividends, retirement or other features, and have no
preemptive rights.
TIP Funds is authorized to issue an unlimited number shares of beneficial
interest, with a par value of $.00001 per share, from an unlimited number of
series (portfolios) of shares. The shares of each TIP Fund have no preference as
to conversion, exchange, dividends, retirement or other features, and have no
preemptive rights.
SHAREHOLDER MEETINGS. Annual meetings of shareholders of Alpha Select Funds will
not be held, but special meetings of shareholders may be held under certain
circumstances. A meeting will be held to vote on the removal of a Trustee(s) of
a Fund if requested in writing by the holders of not less than [10%] of the
outstanding shares of the Fund. The Funds will assist in shareholder
communications in such matters to the extent required by law.
TIP Funds has similar voting provisions.
ELECTION AND TERM OF TRUSTEES. Alpha Select's affairs are supervised by the
Trustees under the laws governing business trusts in the State of Delaware.
Trustees of Alpha Select are elected by a majority vote of a quorum cast by
written ballot at the regular meeting of shareholders, if any, or at a special
meeting held for that purpose. Trustees hold office until their successors are
duly elected and qualified or until their death, removal or resignation.
Shareholders may remove a Trustee by vote of a majority of the votes entitled to
be cast for the election of directors and may elect a successor to fill a
resulting vacancy. A Trustee elected thereby serves for the balance of the term
of the removed Trustee.
TIP Funds has similar requirements regarding Trustees, except it is governed by
the laws of the Commonwealth of Massachusetts.
13
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SHAREHOLDER LIABILITY. Shareholders of Alpha Select are not personally liable
for the obligations of the Alpha Select Funds.
The shareholders of the TIP Funds generally are not personally liable for the
acts, omissions or obligations of the Trustees or of TIP Funds.
LIABILITY OF TRUSTEES. The Trustees shall not be personally liable for any
obligation of the Alpha Select Funds. The Funds will indemnify its Trustees and
officers out of Fund assets against all liabilities and expenses except for
liabilities arising from such person's self-dealing, willful misconduct or
recklessness.
TIP Funds has similar provisions regarding Trustee liability.
ADDITIONAL INFORMATION ABOUT THE FUNDS AND OTHER MATTERS
THE ADMINISTRATOR. SEI Investments Mutual Funds Services (the "Administrator")
provides both TIP Funds and Alpha Select Funds with administrative services,
including regulatory reporting and all necessary office space, equipment,
personnel, and facilities.
The Administrator also serves as shareholder servicing agent for both TIP Funds
and Alpha Select Funds under a shareholder servicing agreement with each Trust.
THE TRANSFER AGENT AND CUSTODIAN. DST Systems, Inc. (the "Transfer Agent"), 330
W. 9th Street, Kansas City, Missouri 64105, serves as the transfer agent and
dividend disbursing agent for both TIP Funds and Alpha Select Funds under a
transfer agency agreement with each Trust. First Union National Bank, Broad and
Chestnut Streets, P.O. Box 7618, Philadelphia, Pennsylvania 19101 acts as the
custodian (the "Custodian") of Alpha Select Funds and TIP Funds.
THE DISTRIBUTOR. SEI Investments Distribution Co. ("SIDCO"), Oaks, Pennsylvania
19456, a wholly-owned subsidiary of SEI Investments Company, acts as distributor
for both TIP Funds and Alpha Select Funds pursuant to a distribution agreement
(the "Distribution Agreement"). No compensation is paid to the Distributor for
its distribution services to TIP Funds.
PORTFOLIO TRANSACTIONS. For Alpha Select Funds' fiscal period ended September
30, 1998, the Funds paid the following amounts in brokerage commissions to
affiliates of the Funds.
14
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<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
TOTAL BROKERAGE AMOUNT PAID TO % PAID TO AFFILIATED
FUND COMMISSIONS AFFILIATED BROKER BROKER
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Penn Capital Strategic $10,312 N/A N/A
High Yield Bond Fund
- --------------------------------------------------------------------------------------------------------------------
Turner Micro Cap $6,974 N/A N/A
Growth Fund
- --------------------------------------------------------------------------------------------------------------------
Turner Short Duration N/A N/A N/A
Government Funds - Three
Year Portfolio
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
VOTING INFORMATION
ADJOURNMENT. In the event that sufficient votes in favor of a Proposal for one
or more Funds set forth in the Notice of the Special Meeting are not received by
the time scheduled for the meeting, the persons named as proxies may propose one
or more adjournments of the meeting for a period or periods of not more than 60
days in the aggregate to permit further solicitation of proxies with respect to
the Proposal. Any such adjournment will require the affirmative vote of a
majority of the votes cast on the question in person or by proxy at the session
of the meeting to be adjourned. The persons named as proxies will vote in favor
of such adjournment those proxies which they are entitled to vote in favor of
the Proposal. They will vote against any such adjournment those proxies required
to be voted against the Proposal. The costs of any such additional solicitation
and of any adjourned session will be borne by Turner.
REQUIRED VOTE. Shares represented by a properly executed proxy will be voted in
accordance with the instructions thereon, or if no specification is made, the
shares will be voted "FOR" the approval of the Reorganization Agreement.
Approval of a Proposal with respect to a Fund requires the affirmative vote of a
majority of the Shareholders of that Fund.
Abstentions and "broker non-votes" will not be counted for or against any
Proposal to which it relates, but will be counted for purposes of determining
whether a quorum is present. Abstentions and broker non-votes will be counted as
votes present for purposes of determining the number of voting securities
present at the Meeting, and will therefore have the effect of counting against
the Proposal.
5% SHAREHOLDERS. As of December 11, 1998, the following persons were the only
persons who were, to the knowledge of Alpha Select, beneficial owners of 5% or
more of shares of the Funds:
15
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<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS OF BENEFICIAL NUMBER OF PERCENTAGE OF FUND'S
FUND OWNER SHARES SHARES
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
Alpha Select's Trustees and officers beneficially own [LESS THAN 1%] of the
shares of Alpha Select.
OTHER INFORMATION
SHAREHOLDER PROPOSALS. Alpha Select Funds does not hold annual Shareholder
Meetings. Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent meeting should send their written proposals to the
Secretary of Alpha Select Funds c/o SEI Investments Company, Legal Department,
Oaks, Pennsylvania 19456.
REPORTS TO SHAREHOLDERS. Alpha Select will furnish, without charge, a copy of
the most recent Annual Report to Shareholders of the Funds and the most recent
Semi-Annual Report succeeding such Annual Report, if any, on request. Requests
should be directed to Alpha Select Funds, or by calling 1-888-TIP-7654.
OBTAINING ADDITIONAL INFORMATION. Information about TIP Funds and Alpha Select
Funds, including the prospectus, SAI, and shareholder reports of each Fund, may
be obtained from the SEC in any of the following ways: (1) in person: you may
review and copy documents in the SEC's Public Reference Room in Washington D.C.
(for information call 1-800-SEC-0330); (2) on-line: you may retrieve information
from the SEC's web site at "http://www.sec.gov"; or (3) mail: you may request
documents, upon payment of a duplicating fee, by writing to SEC, Public
Reference Section, Washington, D.C. 20549-6009. To aid you in obtaining this
information, TIP Funds' 1940 Act registration number is 811-07527 and Alpha
Select Funds' 1940 Act registration number is 811-08104.
16
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OTHER MATTERS. The Trustees know of no other business to be brought before the
Meeting. However, if any other matters properly come before the Meeting, it is
their intention that proxies which do not contain specific restrictions to the
contrary will be voted on such matters in accordance with the judgment of the
persons named in the enclosed form of proxy.
SHAREHOLDER INQUIRIES. Shareholder inquiries may be addressed to Alpha Select
Funds in writing at the address on the cover page of this Proxy Statement or by
telephoning 1-888-TIP-7654.
---------------------
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING ARE REQUESTED TO
DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES. [YOU MAY ALSO VOTE OVER THE
INTERNET OR BY TELEPHONE. PLEASE FOLLOW THE ENCLOSED INSTRUCTIONS TO UTILIZE
THESE METHODS OF VOTING.]
17
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EXHIBIT A
FORM OF AGREEMENT AND PLAN
OF REORGANIZATION AND LIQUIDATION
AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION dated as of
_____________, 199_ (the "Agreement"), by and between the Alpha Select Funds
(the "Trust"), a Delaware business trust, on behalf of the Penn Capital
Strategic High Yield Bond Fund, the Turner Micro Cap Growth Fund, the and the
Turner Short Duration Government Funds - Three Year Portfolio (collectively, the
"Acquired Funds"), and the TIP Funds ("TIP Funds") a Massachusetts business
trust, on behalf of the TIP Penn Capital Strategic High Yield Bond Fund, the TIP
Turner Micro Cap Growth Fund, and TIP Turner Short Duration Government Funds -
Three Year Portfolio (collectively, the "Acquiring Funds").
WHEREAS, the Trust was organized under Delaware law as a business trust
under a Declaration of Trust dated October 25, 1993, as amended and restated on
October 7, 1998. The Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"). The Trust has authorized capital consisting of an unlimited number of
units of beneficial interest of separate series of the Trust. The Acquired Funds
are duly organized and validly existing series of the Trust;
WHEREAS, TIP Funds was organized under Massachusetts law as a business
trust under a Declaration of Trust dated January 26, 1996, as amended and
restated on February 21, 1997. TIP Funds is an open-end management investment
company registered under the 1940 Act. TIP Funds has authorized capital
consisting of an unlimited number of units of beneficial interest of separate
series of TIP Funds. The Acquiring Funds are duly organized and validly existing
series of TIP Funds;
NOW, THEREFORE, in consideration of the mutual promises herein
contained, the parties hereto agree to effect the transfer of all of the assets
of the Acquired Funds solely in exchange for the assumption by the corresponding
Acquiring Funds of all or substantially all of the liabilities of the Acquired
Funds and units of beneficial interest of the corresponding Acquiring Funds
("Acquiring Funds Shares") followed by the distribution, at the Effective Time
(as defined in Section 9 of this Agreement), of such Acquiring Funds Shares to
the holders of units of beneficial interest of the Acquired Funds ("Acquired
Funds Shares") on the terms and conditions hereinafter set forth in liquidation
of the Acquired Funds. The parties hereto covenant and agree as follows:
A-1
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1. PLAN OF REORGANIZATION. At the Effective Time, the Acquired Funds will
assign, deliver and otherwise transfer all of their assets and good and
marketable title thereto, and assign all or substantially all of the liabilities
as are set forth in a statement of assets and responsibilities, to be prepared
as of the Effective Time (the "Statement of Assets and Liabilities") to the
Acquiring Funds free and clear of all liens, encumbrances and adverse claims
except as provided in this Agreement, and the Acquiring Funds shall acquire all
such assets, and shall assume all such liabilities of the Acquired Funds, in
exchange for delivery to the Acquired Funds by the Acquiring Funds of a number
of Acquiring Funds Shares (both full and fractional) equivalent in number and
value to the Acquired Funds Shares outstanding immediately prior to the
Effective Time. The assets and stated liabilities of the Acquired Funds, as set
forth in the Statement of Assets and Liabilities attached hereto as Exhibit A,
shall be exclusively assigned to and assumed by the Acquiring Funds. All debts,
liabilities, obligations and duties of the Acquired Funds, to the extent that
they exist at or after the Effective Time and are stated in the Statement of
Assets and Liabilities, shall after the Effective Time attach to the Acquiring
Funds and may be enforced against the Acquiring Funds to the same extent as if
the same had been incurred by the Acquiring Funds.
2. TRANSFER OF ASSETS. The assets of the Acquired Funds to be acquired by the
corresponding series of the Acquiring Funds and allocated thereto shall include,
without limitation, all cash, cash equivalents, securities, receivables
(including interest and dividends receivable) as set forth in the Statement of
Assets and Liabilities, as well as any claims or rights of action or rights to
register shares under applicable securities laws, any books or records of the
Acquired Funds and other property owned by the Acquired Funds at the Effective
Time.
3. LIQUIDATION AND DISSOLUTION OF THE ACQUIRED FUNDS. At the Effective Time, the
Acquired Funds will liquidate and the Acquiring Funds Shares (both full and
fractional) received by the Acquired Funds will be distributed to the
shareholders of record of the Acquired Funds as of the Effective Time in
exchange for their respective Acquired Funds Shares and in complete liquidation
of the Acquired Funds. Each shareholder of the Acquired Funds will receive a
number of Acquiring Funds Shares equal in number and value to the Acquired Funds
Shares held by that shareholder, and each Acquiring Funds and Acquired Funds
share will be of equivalent net asset value per share. Such liquidation and
distribution will be accompanied by the establishment of an open account on the
share records of the Acquiring Funds in the name of each shareholder of the
Acquired Funds and representing the respective number of Acquiring Funds Shares
due such shareholder. As soon as practicable after the Effective Time, but not
later than _________, 199_ the Trust shall take all steps as shall be necessary
and proper to effect a complete termination of the Acquired Funds.
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4. REPRESENTATIONS AND WARRANTIES OF THE ACQUIRING FUNDS. The Acquiring Funds
represent and warrant to the Acquired Funds as follows:
(a) ORGANIZATION, EXISTENCE, ETC. TIP Funds is a business trust duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has the power to carry on its
business as it is now being conducted.
(b) REGISTRATION AS INVESTMENT COMPANY. TIP Funds is registered under
the 1940 Act as an open-end management investment company; such
registration has not been revoked or rescinded and will be in full
force and effect.
(c) FINANCIAL STATEMENTS. The audited financial statements, if any, of
TIP Funds relating to the Acquiring Funds dated as of September 30,
1998 (the "Acquiring Funds Financial Statements"), which will, if
available, be delivered to the Acquired Funds as of the Effective Time,
will fairly present the financial position of the Acquiring Funds as of
the date thereof.
(d) SHARES TO BE ISSUED UPON REORGANIZATION. The Acquiring Funds Shares
to be issued in connection with the Reorganization have been duly
authorized and upon consummation of the Reorganization will be validly
issued, fully paid and nonassessable. Prior to the Effective Time,
there shall be no issued and outstanding Acquiring Funds Shares or any
other securities issued by the Acquiring Funds.
(e) AUTHORITY RELATIVE TO THIS AGREEMENT. TIP Funds, on behalf of the
Acquiring Funds, has the power to enter into this Agreement and to
carry out its obligations hereunder. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, have been duly authorized by the TIP Funds Board
of Trustees, and no other proceedings by the Acquiring Funds are
necessary to authorize its officers to effectuate this Agreement and
the transactions contemplated hereby. Each of the Acquiring Funds is
not a party to or obligated under any charter, by-law, indenture or
contract provision or any other commitment or obligation, or subject to
any order or decree, which would be violated by its executing and
carrying out this Agreement.
(f) LIABILITIES. There are no liabilities of the Acquiring Funds,
whether or not determined or determinable, other than liabilities
disclosed or provided for in the Acquiring Funds Financial Statements
and liabilities incurred in the ordinary course of business subsequent
to the Effective Time or otherwise previously disclosed to the Acquired
Funds, none of which has been materially adverse to the business,
assets or results of operations of the Acquiring Funds.
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(g) LITIGATION. Except as previously disclosed to the Acquired Funds,
there are no claims, actions, suits or proceedings pending or, to the
actual knowledge of the Acquiring Funds, threatened which would
materially adversely affect the Acquiring Funds or its assets or
business or which would prevent or hinder in any material respect
consummation of the transactions contemplated hereby.
(h) CONTRACTS. Except for contracts and agreements disclosed to the
Acquired Funds, under which no default exists, each of the Acquiring
Funds is not a party to or subject to any material contract, debt
instrument, plan, lease, franchise, license or permit of any kind or
nature whatsoever with respect to the Acquiring Funds.
(i) TAXES. As of the Effective Time, all Federal and other tax returns
and reports of the Acquiring Funds required by law to have been filed
shall have been filed, and all other taxes shall have been paid so far
as due, or provision shall have been made for the payment thereof, and
to the best of the Acquiring Funds' knowledge, no such return is
currently under audit and no assessment has been asserted with respect
to any of such returns.
5. REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED FUNDS. The Acquired Funds
represent and warrant to the Acquiring Funds as follows:
(a) ORGANIZATION, EXISTENCE, ETC. The Trust is a business trust duly
organized, validly existing and in good standing under the laws of the
State of Delaware and has the power to carry on its business as it is
now being conducted.
(b) REGISTRATION AS INVESTMENT COMPANY. The Trust is registered under
the 1940 Act as an open-end management investment company; such
registration has not been revoked or rescinded and is in full force and
effect.
(c) FINANCIAL STATEMENTS. The audited financial statements of the Trust
relating to the Acquired Funds for the fiscal year ended September 30,
1998, and the unaudited financial statements of the Acquired Funds
dated as of March 31, 1998 (the "Acquired Funds Financial Statements"),
as delivered to the Acquiring Funds, fairly present the financial
position of the Acquired Funds as of the dates thereof, and the results
of its operations and changes in its net assets for the periods
indicated.
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(d) MARKETABLE TITLE TO ASSETS. Each of the Acquired Funds will have,
at the Effective Time, good and marketable title to, and full right,
power and authority to sell, assign, transfer and deliver, the assets
to be transferred to the Acquiring Funds. Upon delivery and payment for
such assets, each of the Acquiring Funds will have good and marketable
title to such assets without restriction on the transfer thereof free
and clear of all liens, encumbrances and adverse claims.
(e) AUTHORITY RELATIVE TO THIS AGREEMENT. The Trust, on behalf of the
Acquired Funds, has the power to enter into this Agreement and to carry
out its obligations hereunder. The execution, delivery and performance
of this Agreement, and the consummation of the transactions
contemplated hereby, have been duly authorized by the Trust's Board of
Trustees, and, except for approval by the shareholders of the Acquired
Funds, no other proceedings by the Acquired Funds are necessary to
authorize its officers to effectuate this Agreement and the
transactions contemplated hereby. Each of the Acquired Funds is not a
party to or obligated under any charter, by-law, indenture or contract
provision or any other commitment or obligation, or subject to any
order or decree, which would be violated by its executing and carrying
out this Agreement.
(f) LIABILITIES. There are no liabilities of the Acquired Funds,
whether or not determined or determinable, other than liabilities
disclosed or provided for in the Acquired Funds Financial Statements
and liabilities incurred in the ordinary course of business subsequent
to _________, 199_, or otherwise previously disclosed to the Acquiring
Funds, none of which has been materially adverse to the business,
assets or results of operations of the Acquired Funds. The Trust's
Registration Statement, which is on file with the Securities and
Exchange Commission, does not contain an untrue statement of a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(g) LITIGATION. Except as previously disclosed to the Acquiring Funds,
there are no claims, actions, suits or proceedings pending or, to the
knowledge of the Acquired Funds, threatened which would materially
adversely affect the Acquired Funds or its assets or business or which
would prevent or hinder in any material respect consummation of the
transactions contemplated hereby.
(h) CONTRACTS. Except for contracts and agreements disclosed to the
Acquiring Funds, under which no default exists, each of the Acquired
Funds, at the Effective Time, is not a party to or subject to any
material contract, debt instrument, plan, lease, franchise, license or
permit of any kind or nature whatsoever.
(i) TAXES. As of the Effective Time, all Federal and other tax returns
and reports of the Acquired Funds required by law to have been filed
shall have been filed, and all other taxes shall have been paid so far
as due, or provision shall have been made for the payment thereof, and
to the best of the Acquired Funds' knowledge, no such return is
currently under audit and no assessment has been asserted with respect
to any of such returns.
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6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUNDS.
(a) All representations and warranties of the Acquired Funds contained
in this Agreement shall be true and correct in all material respects as
of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Effective Time,
with the same force and effect as if made on and as of the Effective
Time.
(b) The Acquiring Funds shall have received an opinion of counsel for
the Acquired Funds, dated as of the Effective Time, addressed to and in
form and substance satisfactory to counsel for the Acquiring Funds, to
the effect that (i) the Acquired Funds are duly organized and validly
existing series of the Trust under the laws of the Commonwealth of
Massachusetts; (ii) the Trust is an open-end management investment
company registered under the 1940 Act; (iii) this Agreement and the
Reorganization provided for herein and the execution of this Agreement
have been duly authorized and approved by all requisite action of each
of the Acquired Funds and this Agreement has been duly executed and
delivered by the Trust on behalf of the Acquired Funds and is a valid
and binding obligation of the Acquired Funds, subject to applicable
bankruptcy, insolvency, fraudulent conveyance and similar laws or court
decisions regarding enforcement of creditors' rights generally; (iv) to
the best of counsel's knowledge after reasonable inquiry, no consent,
approval, order or other authorization of any Federal or state court or
administrative or regulatory agency is required for each of the
Acquired Funds to enter into this Agreement or carry out its terms that
has not been obtained other than where the failure to obtain any such
consent, approval, order or authorization would not have a material
adverse effect on the operations of the Acquired Funds; and (v) upon
consummation of this Agreement, the Acquiring Funds shall have acquired
all of the Acquired Funds's assets listed in the Statement of Assets
and Liabilities, free and clear of all liens encumbrances or adverse
claims.
(c) The Acquired Funds shall have delivered to the Acquiring Funds at
the Effective Time the Acquired Funds' Statement of Assets and
Liabilities, prepared in accordance with generally accepted accounting
principles consistently applied, together with a certificate of the
Treasurer or Assistant Treasurer of the Acquired Funds as to the
aggregate asset value of the Acquired Funds' portfolio securities.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUNDS.
(a) All representations and warranties of the Acquiring Funds contained
in this Agreement shall be true and correct in all material respects as
of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Effective Time,
with the same force and effect as if made on and as of the Effective
Time.
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(b) The Acquired Funds shall have received an opinion of counsel, dated
as of the Effective Time, addressed to and in form and substance
satisfactory to counsel for the Acquired Funds, to the effect that: (i)
the Acquiring Funds are duly organized and validly existing series of
TIP Funds under the laws of the Commonwealth of Massachusetts; (ii) TIP
Funds is an open-end management investment company registered under the
1940 Act; (iii) this Agreement and the Reorganization provided for
herein and the execution of this Agreement have been duly authorized
and approved by all requisite corporate action of each of the Acquiring
Funds and this Agreement has been duly executed and delivered by the
Acquiring Funds and is a valid and binding obligation of the Acquiring
Funds, subject to applicable bankruptcy, insolvency, fraudulent
conveyance and similar laws or court decisions regarding enforcement of
creditors' rights generally; (iv) to the best of counsel's knowledge,
no consent, approval, order or other authorization of any Federal or
state court or administrative or regulatory agency is required for each
of the Acquiring Funds to enter into this Agreement or carry out its
terms that has not already been obtained, other than where the failure
to obtain any such consent, approval, order or authorization would not
have a material adverse effect on the operations of the Acquiring
Funds; and (v) the Acquiring Funds Shares to be issued in the
Reorganization have been duly authorized and upon issuance thereof in
accordance with this Agreement will be validly issued, fully paid and
nonassessable.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUNDS AND
THE ACQUIRING FUNDS. The obligations of the Acquired Funds and the
Acquiring Funds to effectuate this Agreement shall be subject to the
satisfaction of each of the following conditions:
(a) Such authority from the Securities and Exchange Commission (the
"SEC") as may be necessary to permit the parties to carry out the
transactions contemplated by this Agreement shall have been received.
(b) With respect to the Acquired Funds, the Trust will call a meeting
of shareholders to consider and act upon this Agreement and to take all
other actions reasonably necessary to obtain the approval by
shareholders of each of the Acquired Funds of this Agreement and the
transactions contemplated herein, including the Reorganization and the
termination of the Acquired Funds if the Reorganization is consummated.
The Trust has prepared or will prepare the notice of meeting, form of
proxy and proxy statement (collectively, "Proxy Materials") to be used
in connection with such meeting; provided that the Acquiring Funds has
furnished or will furnish a current, effective Prospectus relating to
the Acquiring Funds Shares for incorporation within and/or distribution
with the Proxy Materials, and with such other information relating to
the Acquiring Funds as is reasonably necessary for the preparation of
the Proxy Materials.
(c) The Registration Statement on Form N-1A of the Acquiring Funds
shall be effective under the Securities Act of 1933 and, to the best
knowledge of the Acquiring Funds, no investigation or proceeding for
that purpose shall have been instituted or be pending, threatened or
contemplated under the 1933 Act.
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(d) The shares of the Acquiring Funds shall have been duly qualified
for offering to the public in all states of the United States, the
Commonwealth of Puerto Rico and the District of Columbia (except where
such qualifications are not required) so as to permit the transfer
contemplated by this Agreement to be consummated.
(e) The Acquired Funds and the Acquiring Funds shall have received on
or before the Effective Time an opinion of counsel satisfactory to the
Acquired Funds and the Acquiring Funds substantially to the effect that
for Federal income tax purposes:
(1) No gain or loss will be recognized to the Acquired Funds
upon the transfer of its assets in exchange solely for the
Acquiring Funds Shares and the assumption by the Acquiring
Funds of the corresponding Acquired Fund's stated liabilities;
(2) No gain or loss will be recognized to the Acquiring Funds
on its receipt of the Acquired Funds' assets in exchange for
the Acquiring Funds Shares and the assumption by the Acquiring
Funds of the corresponding Acquired Fund's liabilities;
(3) The basis of an Acquired Fund's assets in the
corresponding Acquiring Fund's hands will be the same as the
basis of those assets in the Acquired Fund's hands immediately
before the conversion;
(4) The Acquiring Funds' holding period for the assets
transferred to the Acquiring Funds by the Acquired Funds will
include the holding period of those assets in the
corresponding Acquired Fund's hands immediately before the
conversion;
(5) No gain or loss will be recognized to the Acquired Funds
on the distribution of the Acquiring Funds Shares to the
Acquired Funds' shareholders in exchange for their Acquired
Funds Shares;
(6) No gain or loss will be recognized to the Acquired Funds'
shareholders as a result of the Acquired Funds' distribution
of Acquiring Funds Shares to the Acquired Funds' shareholders
in exchange for the Acquired Funds' shareholders' Acquired
Funds Shares;
(7) The basis of the Acquiring Funds Shares received by the
Acquired Funds' shareholders will be the same as the adjusted
basis of that Acquired Funds' shareholders' Acquired Funds
Shares surrendered in exchange therefor; and
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(8) The holding period of the Acquiring Funds Shares received
by the Acquired Funds' shareholders will include the Acquired
Funds' shareholders' holding period for the Acquired Funds'
shareholders' Acquired Funds Shares surrendered in exchange
therefor, provided that said Acquired Funds Shares were held
as capital assets on the date of the conversion.
(f) A vote approving this Agreement and the Reorganization contemplated
hereby shall have been adopted by at least a majority of the
outstanding shares of each of the Acquired Funds entitled to vote at an
annual or special meeting.
(g) The Board of Trustees of TIP Funds, at a meeting duly called for
such purpose, shall have authorized the issuance by each of the
Acquiring Funds of Acquiring Funds Shares at the Effective Time in
exchange for the assets of the Acquired Funds pursuant to the terms and
provisions of this Agreement.
9. EFFECTIVE TIME OF THE REORGANIZATION. The exchange of the Acquired Funds'
assets for Acquiring Funds Shares shall be effective as of close of business on
January 27, 1999, or at such other time and date as fixed by the mutual consent
of the parties (the "Effective Time").
10. TERMINATION. This Agreement and the transactions contemplated hereby may be
terminated and abandoned without penalty by resolution of the Board of Trustees
of the Trust, at any time prior to the Effective Time, if circumstances should
develop that, in the opinion of the Board, make proceeding with the Agreement
inadvisable.
11. AMENDMENT. This Agreement may be amended, modified or supplemented in such
manner as may be mutually agreed upon in writing by the parties; provided,
however, that following the Shareholders' Meeting called on behalf of the
Acquired Funds pursuant to Section 8 of this Agreement, no such amendment may
have the effect of changing the provisions for determining the number or value
of Acquiring Funds Shares to be paid to the Acquired Funds' shareholders under
this Agreement to the detriment of the Acquired Funds, shareholders without
their further approval.
12. GOVERNING LAW. This Agreement shall be governed and construed in accordance
with the laws of the State of Massachusetts.
13. NOTICES. Any notice, report, statement or demand required or permitted by
and provision of this Agreement shall be in writing and shall be given by
prepaid telegraph, telecopy, certified mail or overnight express courier
addressed as follows:
if to the Acquiring Funds:
- -------------------
- -------------------
- -------------------
- -------------------
A-9
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with a copy to:
James W. Jennings, Esq.
Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
if to the Acquired Funds:
- -------------------
- -------------------
- -------------------
- -------------------
with a copy to:
John H. Grady, Jr., Esq.
Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
14. FEES AND EXPENSES.
(a) Each of the Acquiring Funds and the Acquired Funds represents and
warrants to the other that there are no brokers or finders entitled to
receive any payments in connection with the transactions provided for
herein.
(b) Except as otherwise provided for herein, all expenses of the
transactions contemplated by this Agreement incurred by each of the
Acquired Funds and the Acquiring Funds will be borne by Turner
Investment Partners. Such expenses include, without limitation, (i)
expenses incurred in connection with the entering into and the carrying
out of the provisions of this Agreement; (ii) expenses associated with
the preparation and filing of the Proxy Statement under the 1934 Act;
(iii) registration or qualification fees and expenses of preparing and
filing such forms as are necessary under applicable state securities
laws to qualify the Acquiring Funds Shares to be issued in connection
herewith in each state in which the Acquired Funds' shareholders are
resident as of the date of the mailing of the Proxy Statement to such
shareholders; (iv) postage; (v) printing; (iv) accounting fees; (vii)
legal fees; and (viii) solicitation costs of the transaction.
Notwithstanding the foregoing, the Acquiring Funds shall pay their own
Federal and state registration fees.
15. HEADINGS, COUNTERPARTS, ASSIGNMENT.
(a) The article and paragraph headings contained in this Agreement are
for reference purposes only and shall not effect in any way the meaning
or interpretation of this Agreement.
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(b) This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original.
(c) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, but no
assignment or transfer hereof or of any rights or obligations hereunder
shall be made by any party without the written consent of the other
party. Nothing herein expressed or implied is intended or shall be
construed to confer upon or give any person, firm or corporation other
than the parties hereto and their respective successors and assigns any
rights or remedies under or by reason of this Agreement.
16. ENTIRE AGREEMENT. Each of the Acquiring Funds and the Acquired Funds agree
that neither party has made any representation, warranty or covenant not set
forth herein and that this Agreement constitutes the entire agreement between
the parties. The representations, warranties and covenants contained herein or
in any document delivered pursuant hereto or in connection herewith shall
survive the consummation of the transactions contemplated hereunder.
17. FURTHER ASSURANCES. Each of the Acquiring Funds and the Acquired Funds shall
take such further action as may be necessary or desirable and proper to
consummate the transactions contemplated hereby.
18. BINDING NATURE OF AGREEMENT. As provided in each Trust's Declaration of
Trust on file with the Secretary of State of the State of Delaware, this
Agreement was executed by the undersigned officers of TIP Funds and the Trust,
on behalf of each of the Acquiring Funds and the Acquired Funds, respectively,
as officers and not individually, and the obligations of this Agreement are not
binding upon the undersigned officers individually, but are binding only upon
the assets and property of each Trust. Moreover, no series of a trust shall be
liable for the obligations of any other series of that trust.
Attest: THE ALPHA SELECT FUNDS,
on behalf of its series, the Penn
Capital Strategic High Yield Bond
Fund, the Turner Micro Cap Growth
Fund, and the Turner Short Duration
Government Funds-Three Year
Portfolio
________________________ By:______________________________
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Attest: TIP FUNDS,
on behalf of its series, the Penn
Capital Strategic High Yield Bond
Fund, the Turner Micro Cap Growth
Fund, and the Turner Short Duration
Government Funds-Three Year
Portfolio
________________________ By:______________________________
A-12
<PAGE>
ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
PENN CAPITAL STRATEGIC HIGH YIELD BOND FUND
SPECIAL MEETING OF THE SHAREHOLDERS
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR
THE SPECIAL MEETING OF SHAREHOLDERS, JANUARY 25, 1999
The undersigned, revoking previous proxies with respect to the Shares (defined
below), hereby appoints Stephen J. Kneeley and Lynda J. Striegel as proxies and
each of them, each with full power of substitution, to vote at the Special
Meeting of Shareholders of the Penn Capital Strategic High Yield Bond Fund of
Alpha Select Funds (formerly, TIP Institutional Funds) (the "Trust") to be held
in the offices of SEI Investments Company ("SEI Investments"), Oaks,
Pennsylvania 19456, on Monday, January 25, 1999, at 3:30 p.m., and any
adjournments or postponements thereof (the "Meeting") all shares of beneficial
interest of said Trust that the undersigned would be entitled to vote if
personally present at the Meeting ("Shares") on the proposal set forth below
respecting the proposed Agreement and Plan of Reorganization between the Trust,
on behalf of the Alpha Select Penn Capital Strategic High Yield Bond Fund, and
TIP Funds Penn Capital Strategic High Yield Bond Fund, and, in accordance with
their own discretion, any other matters properly brought before the Meeting.
<PAGE>
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS A VOTE "FOR" THE PROPOSAL TO:
PROPOSAL 1. Approval of an Agreement and Plan of Reorganization and
Liquidation providing for the transfer of the assets and
liabilities of the Penn Capital Strategic High Yield Bond Fund, a
portfolio of the Alpha Select Funds, in exchange for shares of
the Penn Capital Strategic High Yield Bond Fund, a portfolio of
the TIP Funds.
____For ____Against ____Abstain
THIS PROXY WILL, WHEN PROPERLY EXECUTED, BE VOTED AS DIRECTED HEREIN BY THE
SIGNING SHAREHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS
RETURNED, THIS PROXY WILL BE VOTED FOR THE FOREGOING PROPOSAL AND WILL BE VOTED
IN THE APPOINTED PROXIES' DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY
COME BEFORE THE MEETING.
<PAGE>
The undersigned acknowledges receipt with this Proxy of a copy of the Notice of
Special Meeting and the Proxy Statement of the Board of Trustees. Your
signature(s) on this Proxy should be exactly as your name(s) appear on this
Proxy. If the shares are held jointly, each holder should sign this Proxy.
Attorneys-in-fact, executors, administrators, trustees or guardians should
indicate the full title and capacity in which they are signing.
Dated: , 199_
--------------------------------
Signature of Shareholder
--------------------------------
Signature (Joint owners)
PLEASE DATE, SIGN AND RETURN PROMPTLY USING THE ENCLOSED, POSTAGE-PAID ENVELOPE
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING; YOU MAY, NEVERTHELESS, VOTE IN
PERSON IF YOU DO ATTEND.
<PAGE>
ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
TURNER MICRO CAP GROWTH FUND
SPECIAL MEETING OF THE SHAREHOLDERS
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR
THE SPECIAL MEETING OF SHAREHOLDERS, JANUARY 25, 1999
The undersigned, revoking previous proxies with respect to the Shares (defined
below), hereby appoints Stephen J. Kneeley and Lynda J. Striegel as proxies and
each of them, each with full power of substitution, to vote at the Special
Meeting of Shareholders of the Turner Micro Cap Growth Fund of Alpha Select
Funds (formerly, TIP Institutional Funds) (the "Trust") to be held in the
offices of SEI Investments Company ("SEI Investments"), Oaks, Pennsylvania
19456, on Monday, January 25, 1999, at 3:30 p.m., and any adjournments or
postponements thereof (the "Meeting") all shares of beneficial interest of said
Trust that the undersigned would be entitled to vote if personally present at
the Meeting ("Shares") on the proposal set forth below respecting the proposed
Agreement and Plan of Reorganization between the Trust, on behalf of the Alpha
Select Turner Micro Cap Growth Fund, and TIP Funds Turner Micro Cap Growth Fund,
and, in accordance with their own discretion, any other matters properly brought
before the Meeting.
<PAGE>
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS A VOTE "FOR" THE PROPOSAL TO:
PROPOSAL 1. Approval of an Agreement and Plan of Reorganization and
Liquidation providing for the transfer of the assets and
liabilities of the Turner Micro Cap Growth Fund, a portfolio of
the Alpha Select Funds, in exchange for shares of the Turner
Micro Cap Growth Fund, a portfolio of the TIP Funds.
____For ____Against ____Abstain
THIS PROXY WILL, WHEN PROPERLY EXECUTED, BE VOTED AS DIRECTED HEREIN BY THE
SIGNING SHAREHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS
RETURNED, THIS PROXY WILL BE VOTED FOR THE FOREGOING PROPOSAL AND WILL BE VOTED
IN THE APPOINTED PROXIES' DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY
COME BEFORE THE MEETING.
<PAGE>
The undersigned acknowledges receipt with this Proxy of a copy of the Notice of
Special Meeting and the Proxy Statement of the Board of Trustees. Your
signature(s) on this Proxy should be exactly as your name(s) appear on this
Proxy. If the shares are held jointly, each holder should sign this Proxy.
Attorneys-in-fact, executors, administrators, trustees or guardians should
indicate the full title and capacity in which they are signing.
Dated: , 199_
--------------------------------
Signature of Shareholder
--------------------------------
Signature (Joint owners)
PLEASE DATE, SIGN AND RETURN PROMPTLY USING THE ENCLOSED, POSTAGE-PAID ENVELOPE
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING; YOU MAY, NEVERTHELESS, VOTE IN
PERSON IF YOU DO ATTEND.
<PAGE>
ALPHA SELECT FUNDS
(FORMERLY, TIP INSTITUTIONAL FUNDS)
TURNER SHORT DURATION GOVERNMENT FUND - THREE YEAR PORTFOLIO
SPECIAL MEETING OF THE SHAREHOLDERS
PROXY SOLICITED BY THE BOARD OF TRUSTEES FOR
THE SPECIAL MEETING OF SHAREHOLDERS, JANUARY 25, 1999
The undersigned, revoking previous proxies with respect to the Shares (defined
below), hereby appoints Stephen J. Kneeley and Lynda J. Striegel as proxies and
each of them, each with full power of substitution, to vote at the Special
Meeting of Shareholders of the Turner Short Duration Government Fund - Three
Year Portfolio of Alpha Select Funds (formerly, TIP Institutional Funds) (the
"Trust") to be held in the offices of SEI Investments Company ("SEI
Investments"), Oaks, Pennsylvania 19456, on Monday, January 25, 1999, at 3:30
p.m., and any adjournments or postponements thereof (the "Meeting") all shares
of beneficial interest of said Trust that the undersigned would be entitled to
vote if personally present at the Meeting ("Shares") on the proposal set forth
below respecting the proposed Agreement and Plan of Reorganization between the
Trust, on behalf of the Alpha Select Turner Short Duration Government Fund -
Three Year Portfolio, and TIP Funds Turner Short Duration Government Fund -
Three Year Portfolio, and, in accordance with their own discretion, any other
matters properly brought before the Meeting.
<PAGE>
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS A VOTE "FOR" THE PROPOSAL TO:
PROPOSAL 1. Approval of an Agreement and Plan of Reorganization and
Liquidation providing for the transfer of the assets and
liabilities of the Turner Short Duration Government Funds -
Three Year Portfolio, a portfolio of the Alpha Select Funds, in
exchange for shares of the Turner Short Duration Government
Funds - Three Year Portfolio, a portfolio of the TIP Funds.
____For ____Against ____Abstain
THIS PROXY WILL, WHEN PROPERLY EXECUTED, BE VOTED AS DIRECTED HEREIN BY THE
SIGNING SHAREHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS
RETURNED, THIS PROXY WILL BE VOTED FOR THE FOREGOING PROPOSAL AND WILL BE VOTED
IN THE APPOINTED PROXIES' DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY
COME BEFORE THE MEETING.
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The undersigned acknowledges receipt with this Proxy of a copy of the Notice of
Special Meeting and the Proxy Statement of the Board of Trustees. Your
signature(s) on this Proxy should be exactly as your name(s) appear on this
Proxy. If the shares are held jointly, each holder should sign this Proxy.
Attorneys-in-fact, executors, administrators, trustees or guardians should
indicate the full title and capacity in which they are signing.
Dated: , 199_
--------------------------------
Signature of Shareholder
--------------------------------
Signature (Joint owners)
PLEASE DATE, SIGN AND RETURN PROMPTLY USING THE ENCLOSED, POSTAGE-PAID ENVELOPE
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING; YOU MAY, NEVERTHELESS, VOTE IN
PERSON IF YOU DO ATTEND.
