SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the Appropriate Box:
[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 Rule 14a-11(c) or Rule 14a-12
Mentor Institutional Trust
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(Name of Registrants as Specified in Their Charters)
Mentor Institutional Trust
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(Name of Persons Filing Proxy Statement)
Payment of filing fee (check the appropriate box):
[X] No fee required.
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(1) Title of each class of securities to which transaction applies:
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the filing fee is calculated and state how it was determined):
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fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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<PAGE>
September 23, 1999
IMPORTANT NEWS
FOR SHAREHOLDERS OF MENTOR INSTITUTIONAL TRUST
We encourage you to read the attached proxy statement in full; however, the
following questions and answers represent some typical concerns that
shareholders might have regarding this proxy.
Q: WHY IS MENTOR PROPOSING THESE CHANGES?
The Fund is advised by affiliates of First Union National Bank ("FUNB"). Other
investment advisory affiliates of FUNB serve as investment advisers to the
Evergreen family of funds. The Evergreen Funds were converted into series of
Delaware business trusts beginning in September 1997. The proposal represents
one of the final steps we are undertaking to unify the Evergreen and Mentor fund
families. Shareholders can anticipate the following benefits:
o A single location for fund information, whether you're looking up funds in
the newspaper or locating a Morningstar report on the Internet.
o Possible economies of scale that could result in cost savings as a result
of the SNAP Fund becoming part of the larger Evergreen family of funds.
o No change in the investment advisory function.
Q: WHAT IS THE IMPACT OF THIS CHANGE ON THE SNAP FUND?
The conversion of the Fund into a series of a Delaware business trust will
provide both consistency across the fund family and flexibility compared to its
previous form of organization. In addition, Delaware law offers certain
advantages for business trusts and some important protections for shareholders.
See part I of the proxy statement for more information. All other aspects of the
SNAP Fund will remain the same. This is the only proposal upon which SNAP Fund
shareholders will be asked to vote.
Q: WILL THE SNAP FUND NAME BE REPLACED BY EVERGREEN?
No. The SNAP Fund name will remain the same.
Q: WILL THESE CHANGES AFFECT THE ONGOING EXPENSES OF THE SNAP PROGRAM?
No. The expenses structure of the SNAP program will not be affected
Q: WILL THERE BE ANY EXPENSES ASSOCIATED WITH THIS PROXY SOLICITATION THAT WILL
BE PAID BY THE SNAP FUND?
No. The SNAP Fund will not pay any expenses resulting from this proxy
solicitation. These expenses will be borne by FUNB.
Q: WILL THE VIRGINIA TREASURY BOARD'S RELATIONSHIP WITH THE SNAP FUND'S ADVISER
BE AFFECTED BY THESE CHANGES?
No. The relationship is not affected by the SNAP Fund's conversion to a
Delaware business trust.
Q: WILL THE VIRGINIA TREASURY BOARD'S CONTROL OF THE SNAP FUND BE IN ANYWAY
CHANGED?
No. All that will change is the SNAP Fund's organizational structure.
Q: WILL THE INVESTMENT GUIDELINES CHANGE?
No. The investment guidelines will remain the same.
The Board members of Mentor Institutional Trust recommended that you vote in
favor or FOR the proposal on the enclosed proxy card.
<PAGE>
September __, 1999
Dear Shareholder:
I am writing to shareholders of the SNAP Fund, a series of Mentor Institutional
Trust, to inform you of a special shareholder meeting to be held on October 15,
1999. Before that meeting I would like your vote on an important issue affecting
your fund as described in the attached proxy statement.
The proxy statement includes a proposal relating to the conversion of the SNAP
Fund into a series of a Delaware business trust. The proposal is intended to
provide consistency and increased flexibility throughout the Evergreen and
Mentor fund family. More specific information about the proposal is contained in
the proxy statement. The conversion into a series of an Evergreen Delaware
business trust is currently expected to be completed in October 1999.
The Board of Trustees has unanimously approved the proposal and recommend that
you vote FOR the proposal described within this document.
I realize that this proxy statement will take time to review, but your vote is
very important. Please familiarize yourself with the proposal presented. If you
attend the meeting, you may vote your shares in person. If you do not expect to
attend the meeting, please complete, date, sign and return your proxy card in
the enclosed postage-paid envelope today. Instructions on how to complete the
proxy card is included immediately after the Notice of Special Meeting.
If we do not receive your completed proxy card after several weeks, you may be
contacted by us to remind you to vote your shares. If you have any questions
about the proxy, please call 1-800-225-1587 x3676.
Thank you for taking this matter seriously and participating in this important
process.
Sincerely,
Paul F. Costello
President
Mentor Institutional Trust
901 East Byrd Street
Richmond, Virginia 23219
<PAGE>
MENTOR INSTITUTIONAL TRUST
901 East Byrd Street
Richmond, Virginia 23219
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held on October 15, 1999
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Notice Is Hereby Given that a Special Meeting (the "Meeting") of
Shareholders of the SNAP Fund, a series of the Mentor Institutional Trust (the
"Fund"), will be held at the offices of Mentor Institutional Trust, 901 East
Byrd Street, Richmond, Virginia 23219 on Friday, October 15, 1999 at 2:00 p.m.,
Eastern time, for the following purpose:
1. To approve an Agreement and Plan of Conversion and Termination
(the "Conversion Plan") for the above-named Fund providing for
the conversion of the Fund into a corresponding series (a
"Successor Fund") of the Evergreen Select Money Market Trust,
a Delaware business trust, and in connection therewith, the
acquisition by the Successor Fund of all of the assets of the
Fund in exchange for shares of the Successor Fund, and the
assumption by the Successor Fund of all of the liabilities of
the Fund. The Plan also provides for the distribution of such
shares of the Successor Fund to shareholders of the Fund in
liquidation and subsequent termination of the Fund.
2. To transact any other business which may properly come before the
Meeting or any adjournments thereof.
The close of business on August 17, 1999 has been fixed as the record date for
the determination of shareholders of the Fund entitled to notice of and to vote
at the Meeting or any adjournments thereof.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY.
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND IN PERSON ARE URGED TO SIGN WITHOUT
DELAY AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO
POSTAGE, SO THAT THEIR SHARES MAY BE REPRESENTED AT THE MEETING. YOUR PROMPT
ATTENTION TO THE ENCLOSED PROXY WILL HELP TO AVOID THE EXPENSE OF FURTHER
SOLICITATION.
By Order of the Board of Trustees
Michael H. Koonce
Secretary
September ___, 1999
<PAGE>
INSTRUCTIONS FOR EXECUTING PROXY CARD
The following general rules for signing proxy cards may be of assistance
to you and may help to avoid the time and expense involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the
party signing should conform exactly to a name shown in the
registration on the proxy card.
3. All Other Accounts: The capacity of the individual signing the
proxy card should be indicated unless it is reflected in the
registration. For example:
Registration Valid Signature
Corporate Accounts
(1) ABC Corp. (1) ABC Corp.
(2) ABC Corp. (2) John Doe, Treasurer
(3) ABC Corp. (3) John Doe, Treasurer
c/o John Doe, Treasurer
(4) ABC Corp. Profit Sharing Plan (4) John Doe, Trustee
Trust Accounts
(1) ABC Trust (1) Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee (2) Jane B. Doe
u/t/d 12/28/78
Custodial or Estate Accounts
(1) John B. Smith, Cust. (1) John B. Smith
f/b/o John B. Smith, Jr. UGMA
(2) John B. Smith (2) John B. Smith, Jr.,
Executor
<PAGE>
TABLE OF CONTENTS
Page
PART I
PROPOSAL - THE PROPOSED CONVERSION OF THE FUND INTO A CORRESPONDING SERIES OF
AN EVERGREEN DELAWARE BUSINESS TRUST
Selection of Delaware Business
Trust Form of Organization
Description of the Conversion
The Successor Trust
Certain Comparative Information
About the Trust and the Successor Trust
Current and Successor Advisory
Agreements
Administration Agreement
Current and Successor Distribution
Arrangements
Name
Certain Votes to Be Taken
Prior to the Conversion
Investment Objectives and
Restrictions
Federal Income Tax Consequences
Appraisal Rights
Recommendation of Trustees
Required Vote
PART II
VOTING INFORMATION CONCERNING THE MEETING
ADDITIONAL INFORMATION
Payment of Expenses
Beneficial Ownership
Annual and Semi-Annual Reports to
Shareholders
OTHER BUSINESS
EXHIBIT A - FORM OF AGREEMENT AND PLAN OF
CONVERSION AND TERMINATION A-1
EXHIBIT B - MANAGEMENT OF THE
SUCCESSOR TRUST B-1
EXHIBIT C - NUMBER OF SHARES OF THE
FUND OUTSTANDING AS OF
THE CLOSE OF BUSINESS ON AUGUST 17, 1999 C-1
EXHIBIT D - VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF D-1
<PAGE>
MENTOR INSTITUTIONAL TRUST
901 East Byrd Street
Richmond, Virginia 23219
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PROXY STATEMENT
Special Meeting of Shareholders
October 15, 1999
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This proxy statement is furnished in connection with the solicitation by
the Board of Trustees of Mentor Institutional Trust (the "Trust") for the
special meeting of shareholders of SNAP Fund to be held on Friday, October 15,
1999, at the offices of the Trust, 901 East Byrd Street, Richmond, Virginia
23219 at 2:00 p.m., and any adjournments thereof (the "Meeting"). A notice of
the Meeting and a proxy card accompany this proxy statement. Shareholders of
record at the close of business on August 17, 1999 (the "Record Date") are
entitled to notice of, and to vote at, the Meeting. This proxy statement and the
accompanying Notice of Meeting and proxy card are first being mailed to
shareholders on or about September __, 1999.
The SNAP Fund is a separate series of the Trust and is referred to herein
as the "Fund." As used in this proxy statement, the Trust's Board of Trustees is
referred to as a "Board."
<PAGE>
PART I
PROPOSAL - THE PROPOSED CONVERSION
OF THE FUND INTO A CORRESPONDING SERIES OF AN EVERGREEN
DELAWARE BUSINESS TRUST
At the Meeting, the shareholders of the Fund will be asked to approve an
Agreement and Plan of Conversion and Termination (the "Conversion Plan") for the
Fund, which provides for the conversion (the "Conversion") of the Fund into a
corresponding series (the "Successor Fund,") of an Evergreen Delaware business
trust (the "Successor Trust"). The Conversion is part of an overall
restructuring of the series of the Trust (the "Series"), each of which is
advised by First Union National Bank ("FUNB") or one of its affiliates. Other
investment adviser affiliates of FUNB serve as investment advisers to the
Evergreen Funds. The Evergreen Funds were reorganized into series of Delaware
business trusts beginning in September 1997 and it is into series of such
Evergreen Delaware business trusts that the Series of the Trust will be
reorganized.
The restructuring of the Fund into a series of a Delaware business trust
involves the Conversion, which is discussed in Part I of this proxy statement.
The overall restructuring also includes several consolidations to combine
certain other Mentor investment companies or series of certain Mentor investment
companies with series of certain Evergreen investment companies having
substantially similar investment objectives and policies. The Fund is not a
party to such proposed consolidations, and the votes of shareholders of such
other Mentor funds are not being solicited by this proxy statement. By forming a
single family of mutual funds, the intended result of the overall restructuring
is to integrate and enhance the investment management, distribution and
operations of all the mutual funds in the Evergreen and Mentor families of funds
and to maximize the potential for greater operational efficiencies which will
result in possible economies of scale including a possible reduction in Fund
general expenses such as legal and accounting fees, custody fees and Trustees'
fees and expenses.
Selection of Delaware Business Trust Form of Organization
On July 13, 1999, the Trust's Board unanimously approved a proposal by the
Fund's investment adviser to reorganize the Fund as a separate series of an
Evergreen Delaware business trust. The Trust is currently organized as a
Massachusetts business trust. The Fund is proposed to be structured as a series
of a Delaware business trust. The principal reason for reorganizing the Fund as
a series of a Delaware business trust is the availability of certain advantages
of Delaware law with respect to business trusts. The Delaware Business Trust Act
(the "Delaware Act") has been specifically drafted to accommodate the unique
governance needs of investment companies and provides that its policy is to give
maximum freedom of contract to the trust instrument of a Delaware business
trust.
Under the Delaware Act, a shareholder of a Delaware business trust is
entitled to the same limitation of personal liability extended to stockholders
of Delaware corporations. No similar statutory or other authority limiting
business trust shareholder liability exists in Massachusetts. As a result,
Delaware law is generally considered to afford additional protection against
potential shareholder liability not available to shareholders of Massachusetts
business trusts under Massachusetts law. See "Certain Comparative Information
About the Trust and the Successor Trust - Shareholder Liability." Similarly,
Delaware law provides that, should a Delaware trust issue multiple series of
shares, each series will not be liable for the debts of another series, another
potential though remote risk in the case of other business trusts, including
those, such as the Trust, that are organized under Massachusetts law.
Delaware has obtained a favorable national reputation for its business
laws and business environment. The Delaware courts, which may be called upon to
interpret the Delaware Act, are among the nation's most highly respected and
have an expertise in corporate matters which in part grew out of the fact that
Delaware legal issues are concentrated in the Court of Chancery where there are
no juries and where judges issue written opinions explaining their decisions.
Accordingly, there is a well established body of precedent which may be relevant
in deciding issues pertaining to a Delaware business trust.
There are other advantages that may be afforded by a Delaware business
trust. Under Delaware law, the Successor Fund will have the flexibility to
respond to future business contingencies. For example, the Trustees of the
Delaware trust will have the power to incorporate the Successor Trust, to merge
or consolidate it with another entity, to cause a series to become a separate
trust, and to change the Successor Trust's domicile without a
shareholder vote. This flexibility could help to assure that the Successor Trust
operates under the most advanced form of organization and could reduce the
expense and frequency of future shareholder meetings for non-investment related
issues.
Description of the Conversion
The detailed terms and conditions of the Conversion are contained in a
Conversion Plan applicable to the Fund. The information in this proxy statement
with respect to the Conversion Plan is qualified in its entirety by reference
to, and made subject to, the complete text of the form of the Conversion Plan, a
copy of which is attached to this proxy statement as Exhibit A.
It is anticipated that the Fund will participate in the Conversion, if
approved by the shareholders of the Fund. If shareholders of the Fund do not
approve the Conversion, the Fund will continue as currently organized.
If the shareholders of the Fund approve the Conversion and the conditions
of the Conversion are satisfied, all of the assets and liabilities of the Fund
will be transferred to the Successor Fund and each shareholder of the Fund will
receive shares of the Successor Fund (the "New Shares"). The New Shares of the
Successor Fund will be issued to the Fund in consideration of the transfer to
the Successor Fund by the Fund of all assets and liabilities of the Fund.
Immediately thereafter, the Fund will liquidate and distribute the New Shares to
its shareholders. Holders of Class Y Shares of the Fund will receive
Institutional Class New Shares of the Successor Fund which, like the Class Y
Shares, do not change any distribution fees. As a result of the Conversion, each
shareholder will receive, in exchange for his or her Fund shares, New Shares
with a total net asset value equal to the total net asset value of the
shareholder's Fund shares immediately prior to the consummation of the
Conversion.
Because the Conversion will be effected at net asset value without the
imposition of a sales charge, the New Shares acquired by shareholders pursuant
to the proposed Conversion would not be subject to any initial sales charge or
CDSC as a result of the Conversion.
The following is a summary description of charges and fees for the
Institutional Class New Shares of the Successor Fund which will be received by
shareholders in the Conversion.
Institutional Class New Shares are sold at net asset value without any
initial or deferred sales charge and are not subject to distribution-related
fees. Institutional Class shares are available only to institutional investors.
Shareholders who receive Institutional Class New Shares in the Conversion and
who wish to make subsequent purchases of a Successor Fund's shares will be able
to purchase Institutional Class New Shares.
Distribution-Related and Shareholder Servicing-Related Expenses.
The Institutional Class of the Successor Fund does not have a Rule 12b-1
Plan or a shareholder servicing plan.
It will not be necessary for holders of share certificates of the Fund to
exchange their certificates for new certificates following consummation of the
Conversion. Certificates for shares of the Fund issued prior to the Conversion
will represent outstanding shares of the Successor Fund after the Conversion.
Shareholders of the Fund who have not been issued certificates and whose shares
are held in an open account will automatically have those shares designated as
shares of the Successor Fund.
If approved by shareholders of the Fund, it is currently contemplated that
the Conversion will become effective as to the Fund on or about the close of
business on October 15, 1999. However, the Conversion may become effective at
another time and date should the Meeting be adjourned to a later date or should
any other condition to the Conversion not be satisfied at that time.
Notwithstanding prior shareholder approval, the Conversion Plan may be
terminated as to the Fund at any time prior to its implementation by the mutual
agreement of the parties thereto.
The Successor Trust
The Successor Trust was established pursuant to a Agreement and
Declaration of Trust (the "Master Trust Agreement") under the laws of the State
of Delaware. The Successor Trust is organized as a "series company" as that term
is used in Rule 18f-2 under the Investment Company Act of 1940, as amended (the
"1940 Act"). The Successor Trust consists of the Successor Fund and other mutual
funds of the same asset class.
The Board of Trustees of the Successor Trust is currently comprised of
individuals who do not currently serve as Trustees of the Trust. Accordingly,
different Trustees will have ultimate responsibility for the oversight and
management of the Successor Fund subsequent to the Conversion. It is
anticipated that subsequent to the Conversion, two current Trustees of the
Trust, Arnold H. Dreyfuss and Louis W. Moelchert, Jr. will be nominated and
elected as Trustees of the Successor Trust. Information with respect to the
current Trustees of the Successor Trust, including compensation received, is set
forth in Exhibit B.
The Successor Trust is authorized to issue shares divisible into an
indefinite number of different series. The interests of investors in the various
series of the Successor Trust will be separate and distinct. All consideration
received for the sales of shares of a particular series of the Successor Trust,
all assets in which such consideration is invested, and all income, earnings and
profits derived from such investments will be allocated to that series. The
Master Trust Agreement of the Successor Trust provides that the Board of
Trustees of the Successor Trust may: (i) establish one or more additional series
thereof; (ii) issue the shares of any series in any number of classes; (iii)
issue shares of a series to different groups of investors; and (iv) convert a
series into a pooled fund structure, without any further action by the
shareholders of the Successor Trust.
The Master Trust Agreement of the Successor Trust provides for shareholder
voting only for the following matters: (a) the election or removal of Trustees
as provided in the Master Trust Agreement; and (b) with respect to such
additional matters relating to the Successor Trust as may be required by (i)
applicable law, (ii) any by-laws adopted by the Trustees, or (iii) as the
Trustees may consider necessary or desirable. Certain of the foregoing matters
will involve separate votes of one or more of the affected series (or affected
classes of a series) of the Successor Trust, while others will require a vote of
the Successor Trust's shareholders as a whole.
All shares of all series vote together as a single class for the election
or removal of Trustees of the Successor Trust with each having one vote for each
dollar of net asset value applicable to each share, regardless of series. See
"Certain Comparative Information About the Trust and the Successor Trust -
Voting Rights" below.
As required by the 1940 Act, shareholders of each series of the Successor
Trust, voting separately, will have the power to vote at special meetings for,
among other things, changes in fundamental investment restrictions applicable to
such series, approval of any new or amended investment advisory agreement,
approval of any new or amended Rule 12b-1 plan and certain other matters that
affect the shareholders of that series. If, at any time, less than a majority
of the Trustees holding office has been elected by the shareholders,
the Trustees then in office will call a shareholders' meeting for the
purpose of electing Trustees of the Successor Trust.
Certain Comparative Information About the Mentor Trust and the Successor Trust
As a Delaware business trust, the Successor Trust's operations will be
governed by the Master Trust Agreement and By-laws, and applicable Delaware law,
rather than by the Trust's Declaration of Trust and By-laws, and applicable
Massachusetts law. As discussed below, certain of the differences between the
Trust and the Successor Trust derive from provisions of the Successor Trust's
Master Trust Agreement and By-laws. Shareholders entitled to vote at the Meeting
may obtain a copy of a Successor Trust's Master Trust Agreement and By-laws,
without charge, by calling 1-800-225-1587 x3676.
Capitalization. The beneficial interests in each Successor Trust are
issued as transferable shares of beneficial interest, $.001 par value per share.
The Master Trust Agreement permits the Trustees to issue an unlimited number of
shares and to divide such shares into an unlimited number of series or classes
thereof, all without shareholder approval. Each share of a series of the
Successor Trust represents an equal proportionate interest in the assets and
liabilities belonging to that series (or class) as declared by the Board of
Trustees. The Trust is authorized to divide its shares into an unlimited number
of series, and the Trustees are empowered to establish other classes. The Trust
has the authority to issue an unlimited number of transferable shares of
beneficial interest.
Amendments to Governing Instrument. Generally, the provisions of the
Master Trust Agreement of the Successor Trust may be amended without shareholder
approval so long as such amendment is not in contravention of applicable law, by
an instrument in writing signed by a majority of the then Trustees of the
Successor Trust (or by an officer of the Successor Trust pursuant to the vote of
a majority of such Trustees). Under the Master Trust Agreement of the Successor
Trust, except as provided by applicable law, a quorum is more than 25% of the
shares entitled to vote. The quorum requirements of the Trust is more than 30%
of the total number of outstanding shares of all series and classes entitled to
vote. The affirmative vote of a majority of the shares of all series and classes
then outstanding and entitled to vote is generally required to amend the
Declaration of Trust of the Trust (unless any larger vote may be required by
applicable governing documents or other law), except that the Declaration
of Trust may be amended by the Trustees of the Trust without the vote of share-
holders in certain limited circumstances.
Voting Rights. The Successor Trust's Master Trust Agreement provides that
a Trustee may be removed at any special meeting of shareholders by a vote of
two-thirds of the outstanding shares. The Trust's Master Trust Agreement
provides that the Trustees may be removed at any meeting called for the purpose
by vote of holders of two-thirds of the outstanding shares. The Master Trust
Agreement and By-laws of the Trust provide that a meeting of the shareholders
for a purpose requiring action by shareholders as provided in the Master Trust
Agreement or By-laws shall be called by the Trustees upon the written request of
shareholders representing 10% of the outstanding shares of all series and
classes entitled to vote. If the Secretary fails to call the meeting or give
notice for a specified period following the shareholders' written request, then
the shareholders representing 10% of the outstanding shares may, in the name of
the Secretary, call such meeting by giving notice thereof. The By-laws of the
Successor Trust provide that, to the extent required by the 1940 Act, meetings
of the shareholders for the purpose of voting on the removal of any Trustee
shall be called promptly by the Trustees upon the written request of
shareholders holding at least 10% of the outstanding shares of the Successor
Trust entitled to vote. Like the Trust, the Successor Trust will not be required
to hold annual meetings of its shareholders and, at this time, does not intend
to do so. Under the Trust's By-laws, the record date for determining
shareholders who are entitled to notice of, and to vote at, a shareholders'
meeting may not be more than 90 days preceding the scheduled meeting date. Under
the By-laws of the Successor Trust, the record date may not be more than 90 days
nor less than 10 days preceding the scheduled meeting date.
The Master Trust Agreement provides for shareholder voting in certain
circumstances. See "The Successor Trust" above. Shareholders of the Trust have
the power to vote with respect to the election of Trustees, the removal of
Trustees, the approval or termination of any investment advisory or management
agreement, and certain amendments to the Declaration of Trust, to the same
extent as the shareholders of a Massachusetts business corporation as to whether
or not a court action, proceeding or claim should be brought or maintained
derivatively or as a class action on behalf of the Trust, and as required by law
or as the Trustees may consider desirable.
The Master Trust Agreement of the Successor Trust provides that a majority
of the shares voted at a meeting at which a quorum is present shall decide any
questions and that a plurality shall elect a Trustee, except when a different
vote is required or permitted by any provision of the 1940 Act or other
applicable law or by the Master Trust Agreement or the By-laws of the Successor
Trust. Similar requirements apply to the Trust. Shareholders of the Successor
Trust are not required to approve the termination of the Successor Trust. The
Declaration of Trust of the Trust provides that shareholders of the Trust are
required to approve the Trust's termination.
Under the Master Trust Agreement, each share of a Successor Fund is
entitled to one vote for each dollar of net asset value applicable to such
share. Under the current Declaration of Trust of the Trust, each whole share of
beneficial interest is entitled to one vote, and each fractional share is
entitled to a proportionate fractional vote. Under the Trust's Declaration of
Trust or applicable law, except with respect to matters as to which a particular
series or class is affected, all shares of each series or class shall vote as a
single class. Generally, the Declaration of Trust further provides that, where
required by law or applicable regulation, certain matters will be voted on
separately by each fund. In all other matters, all funds vote together as a
group. Over time, the net asset values of funds in the Trust have changed in
relation to one another and are expected to continue to do so in the future.
Because of the divergence in net asset values, a given dollar investment in a
fund with a lower net asset value will purchase more shares, and under the
Trust's current voting provisions, have more votes, than the same investment in
a fund with a higher net asset value. Under the Master Trust Agreement of the
Successor Trust, voting power is related to the dollar value of the
shareholders' investments rather than to the number of shares held. As a
consequence of changing from share voting to dollar voting, shareholders with a
larger investment will have an increased influence in management of the Fund.
Shareholder Liability. Under Delaware law, shareholders of a
Delaware business trust are entitled to the same limitation of personal
liability extended to stockholders of Delaware corporations. No similar
statutory or other authority limiting business trust shareholder liability
exists under Massachusetts law or under the laws of any other state. As a
result, to the extent that the Successor Trust or a shareholder is subject to
the jurisdiction of courts in those states, the courts may not apply Delaware
law, and may thereby subject shareholders of a Delaware trust to liability. To
guard against this risk, the Master Trust Agreement: (a) provides that any
written obligation of the Successor Trust may contain a statement that such
obligation may only be enforced against the assets of the Successor Trust;
however, the omission of such a disclaimer will not operate to create personal
liability for any shareholder; and (b) provides for indemnification out of trust
property of any shareholder held personally liable for the obligations of the
Successor Trust. Accordingly, the risk of a shareholder of the Successor Trust
incurring financial loss beyond that shareholder's investment because of
shareholder liability is limited to circumstances in which: (i) a court refuses
to apply Delaware law; (ii) no contractual limitation of liability was in
effect; and (iii) the Successor Trust itself would be unable to meet its
obligations. In view of Delaware law, the nature of the Successor Trust's
business, and the nature of its assets, the risk of personal liability to a
shareholder of a Successor Trust is remote.
Shareholders of the Trust as shareholders of Massachusetts business
trusts may, under certain circumstances, be held personally liable under the
applicable state law for the obligations of the Trust. However, the Declaration
of Trust under which the Trust is currently established contains an express
disclaimer of shareholder liability and requires that notice of such disclaimer
be given in each agreement entered into or executed by the Trust or the Trustees
of the Trust. The Declaration of Trust also provides for indemnification out of
the assets of the Trust.
Liability and Indemnification of Trustees. Under the Master Trust
Agreement of the Successor Trust, a Trustee is liable to the Successor Trust and
its shareholders only for such Trustee's own willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct of
the office of Trustee or the discharge of the duties of a Trustee. Trustees and
officers of the Successor Trust are entitled to be indemnified for the expenses
of litigation against them except with respect to any matter as to which it has
been determined that such person (i) did not act in good faith in the reasonable
belief that his or her action was in or not opposed to the best interests of the
Successor Trust; or (ii) had acted with willful misfeasance, bad faith, gross
negligence or reckless disregard of his or her duties; and (iii) for a criminal
proceeding, had reasonable cause to believe that his or her conduct was
unlawful, such determination to be based upon the outcome of a court action or
administrative proceeding or a reasonable determination, following a review of
the facts, by (a) a vote of a majority of those Trustees who are neither
"interested persons" within the meaning of the 1940 Act nor parties to the
proceeding, or (b) an independent legal counsel in a written opinion. The
Successor Trust may also advance money to any Trustee or officer involved in a
proceeding discussed above provided that the Trustee or officer undertakes to
repay the Successor Trust if his or her conduct is later determined to preclude
indemnification and certain other conditions are met. It is currently the view
of the staff of the Securities and Exchange Commission ("SEC") that to the
extent that any provisions such as those described above are inconsistent
with the 1940 Act, the provisions of the 1940 Act may preempt the foregoing
provisions.
The Declaration of Trust of the Trust generally provides that its
Trustees shall not be liable to the Trust or its shareholders, except for the
Trustees' acts of willful misfeasance, bad faith, gross negligence, or reckless
disregard of duties involved in the conduct of their office. The Trust's
Declaration of Trust generally also provides that Trustees and officers of the
Trust will be indemnified against liability and expenses of litigation against
them unless their conduct constituted willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of their
office.
Right of Inspection. The By-laws of the Successor Trust provide
that no shareholder of the Successor Trust shall have any right to inspect any
account or book or document of the Successor Trust except as conferred by law or
otherwise by the Trustees or by resolution of the shareholders. The Declaration
of Trust and By-laws of the Trust are silent with respect to the right of
inspection.
The foregoing is only a summary of certain of the differences
between the governing instruments and laws generally applicable to the Trust and
the Successor Trust. It is not a complete list of differences. Shareholders
should refer directly to the provisions of the governing instruments and
applicable law for more complete information.
Current and Successor Advisory Agreements
As a result of the Conversion, the Successor Fund will be subject
to a new investment advisory agreement (the "Successor Advisory Agreement")
between the Successor Trust on behalf of the Successor Fund and the current
investment adviser of the Fund. The current investment advisory agreement of the
Fund (the "Current Advisory Agreement") is similar in many respects to the
Successor Advisory Agreement. Except as noted below, the Successor Advisory
Agreement contains the material terms of the Current Advisory Agreement.
Investment services for the Successor Fund will be performed by Mentor. Most
importantly, the rate at which fees are required to be paid by the Fund for
investment advisory services, as a percentage of average daily net assets, will
remain the same for the Successor Fund.
The following summarizes certain aspects of the Current Advisory
Agreement and the Successor Advisory Agreement for the Fund.
Brokerage Transactions. The Successor Advisory Agreement sets forth
specific terms as to brokerage transactions and the investment adviser's use of
broker-dealers. For example, the investment adviser will be obligated to use its
best efforts to seek to execute portfolio transactions at prices which, under
the circumstances, result in total costs or proceeds being most favorable to the
Successor Fund. In assessing the best overall terms available for any
transaction, the investment adviser will consider all factors it deems relevant,
including the breadth of the market in the security, the price of the security,
the financial condition and execution capability of the broker or dealer,
research services provided and the reasonableness of the commission, if any,
both for the specific transaction and on a continuing basis. The Successor
Advisory Agreement also incorporates the provisions of Section 28(e) of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), which permits an
investment adviser to have its client, including an investment company, pay more
than the lowest available commission for executing a securities trade in return
for research services and products. The Current Advisory Agreement of the Fund
specifies similar standards to be used in the selection of brokers and the same
standard as Section 28(e) with respect to investment advisers and the payment of
commissions.
Liability. The Successor Advisory Agreement and the Current
Advisory Agreement provide that the investment adviser shall have no liability
in connection with rendering services thereunder, other than liabilities
resulting from the adviser's willful misfeasance, bad faith, gross negligence or
reckless disregard of its duties.
Amendments. The Current Advisory Agreement of the Fund provides
that all changes must be approved by a majority of the shares of the Fund. Each
Successor Advisory Agreement provides that only amendments of substance require
shareholder approval.
Administration Agreement
Mentor Investment Group, LLC ("MIG") served as administrator for
Trust until June 1999.
Evergreen Investment Services, Inc. ("EIS"), located at 200 Berkeley
Street, Boston, Massachusetts 02116, currently serves as administrator to the
Fund. EIS receives no fee from the Fund for its services. EIS currently
serves as administrator to certain current series of the Evergreen Delaware
business trusts. After the Conversion, EIS will serve as administrator to the
Successor Fund. It is anticipated that no material change will occur in the
Funds' administrative fees or arrangements as a result of the Conversion.
Current and Successor Distribution Arrangements
Mentor Distributors, LLC, located at 3435 Stelzer Road, Columbus,
Ohio 43219, is the principal distributor for the Trust. Mentor Distributors, LLC
is a wholly-owned subsidiary of BISYS Fund Services, Inc. ("BISYS") of the same
address.
After the Conversion, Evergreen Distributor, Inc. ("EDI"), an
affiliate of BISYS located at 125 West 55th Street, New York, New York 10019,
will serve as principal underwriter for the Successor Fund. EDI currently serves
as distributor to the current series of the Evergreen Delaware business trusts.
It is anticipated that no material change will occur in the Fund's distribution
agreement or the Fund's aggregate amount payable under the Fund's
distribution-related and shareholder servicing-related expenses as a result of
the Conversions.
Names
The Fund will not change its name in connection with the
Conversion.
Certain Votes to be Taken Prior to the Conversions
Prior to the Conversion, EDI will own a single outstanding share of
the Successor Fund. The purpose of the issuance by the Successor Fund of this
nominal share prior to the effective time of the Conversion is to enable the
Successor Trust to eliminate the need to incur the additional expense by the
Successor Trust of having to hold separate meetings of shareholders of the
Successor Fund in order to comply with certain shareholder approval requirements
of the 1940 Act. EDI will vote to approve the investment advisory and principal
underwriting agreements and the selection of the Successor Fund's auditors and
will elect Trustees.
Investment Objectives and Restrictions
The Successor Fund will have the same investment objective as the Fund.
The investment adviser does not presently intend to change in any
material way for the Successor Fund the investment strategy or operations
currently employed for the Fund.
Federal Income Tax Consequences
It is anticipated that the transactions contemplated by the
Conversion will be tax-free. Sullivan & Worcester LLP, 1025 Connecticut Avenue,
N.W., Washington, D.C. 20036, counsel to the Successor Fund, has informed the
Board of Trustees of the Trust and of the Successor Trust that if substantially
all of the assets and liabilities of the Fund are transferred to the Successor
Fund, it will issue an opinion that the Conversion will not give rise to the
recognition of income, gain or loss to the Fund, the Successor Fund, or
shareholders of the Fund for federal income tax purposes pursuant to sections
361, 1032(a) and 354(a)(1), respectively, of the Internal Revenue Code of 1986,
as amended (the "Code"). Such opinion will be based upon customary
representations of the Trust and the Successor Trust and certain customary
assumptions. The receipt of such an opinion is a condition to the consummation
of the Conversion.
A shareholder's adjusted basis for tax purposes in shares of the
Successor Fund after the Conversion will be the same as the shareholder's
adjusted basis for tax purposes in the shares of the Fund immediately before the
Conversion. The holding period for the shares of the Successor Fund received in
the Conversion will include a shareholder's holding period for shares of the
Fund (provided that the shares of the Fund were held as capital assets on the
date of the Conversion). Shareholders should consult their own tax advisers with
respect to the state and local tax consequences of the proposed transaction.
Appraisal Rights
Neither the Trust's Declarations of Trust nor Massachusetts law
grants shareholders of the Trust any rights in the nature of appraisal or
dissenters' rights with respect to any action upon which such shareholders may
be entitled to vote. However, the right of mutual fund shareholders to redeem
their shares is not affected by the proposed Conversion. A shareholder may at
any time redeem his or her shares if he or she does not want to continue as a
shareholder if the Conversion is approved. The procedures for the redemption of
shares are set out in the Fund's prospectus and statement of additional
information.
Recommendation of Trustees
In evaluating the Conversion Plan, the Board of Trustees reviewed
the potential benefits associated with the proposed Conversion and adoption of
the proposed Master Trust Agreement. In this regard, the Trustees of Trust
considered: (i) the potential disadvantages which apply to operating the Fund
under their current form of organization; (ii) the advantages which apply to
operating the Successor Fund as a series of a Delaware business trust; (iii) the
advantages of adopting the Master Trust Agreement under Delaware law; (iv) the
possible economies of scale that could result in cost savings as a result of the
smaller Fund becoming part of the larger Evergreen family of funds; (v) the fact
that there will essentially be no change in the investment advisory management
of the Fund's portfolio securities; and (vi) the expected federal tax
consequences to the Fund, the Successor Fund and shareholders of Trust resulting
from the proposed Conversion, and the likelihood that no recognition of income,
gain or loss for federal income tax purposes will occur as a result thereof.
At the meetings of the Board called for the purpose on July 13,
1999, the Board of Trustees of the Trust voted to approve the proposed Plans of
Conversion for the Fund and determined that participation in the Conversion is
in the best interests of the Fund and that the interests of existing
shareholders will not be diluted as a result of the Conversion.
Required Vote
The affirmative vote of the holders of a majority of the issued and
outstanding shares of the Fund is required to approve the Conversion.
THE TRUSTEES OF THE MENTOR INSTITUTIONAL TRUST RECOMMEND THAT THE SHAREHOLDERS
VOTE TO APPROVE THE PROPOSAL.
PART II
VOTING INFORMATION CONCERNING THE MEETING
Only shareholders of record as of the close of business on the
Record Date will be entitled to notice of, and to vote at, the Meeting or any
adjournment thereof. The holders of more than thirty percent of the total number
of outstanding shares entitled to vote at the Meeting present in person or
represented by proxy will constitute a quorum for the Meeting for the Fund.
If the enclosed form of proxy is properly executed and returned in
time to be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted FOR each proposal listed thereon and FOR any
other matters deemed appropriate. Proxies that reflect abstentions and "broker
non-votes" (i.e., shares held by brokers or nominees as to which (i)
instructions have not been received from the beneficial owners or the persons
entitled to vote or (ii) the broker or nominee does not have discretionary
voting power on a particular matter) will be counted as shares that are present
and entitled to vote for purposes of determining the presence of a quorum, but
will have no effect on the outcome of the vote to approve any proposal requiring
a vote based on the percentage of shares actually voted. A proxy may be revoked
at any time on or before the Meeting by written notice to the Secretary of the
Trust, 901 East Byrd Street, Richmond, Virginia 23219. Unless revoked, all valid
proxies will be voted in accordance with the specifications thereon or, in the
absence of such specifications, FOR approval of the Conversion Plan and the
Conversion contemplated thereby described in Part I of this proxy statement.
Approval of the Conversion Plan requires the affirmative vote of a
majority of the votes cast, with all classes voting together as a single class
at the Meeting at which a quorum of a Fund's shares is present.
Each full share outstanding is entitled to one vote and each
fractional share outstanding is entitled to a proportionate share of one vote.
The number of shares of the Fund outstanding as of the close of business on
August 17, 1999 is set forth in Exhibit C.
Proxy solicitations will be made primarily by mail, but proxy
solicitations may also be made by telephone or personal solicitations conducted
by officers and employees of Mentor or FUNB, their affiliates or other
representatives of the Fund (who will not be paid for their solicitation
activities). If you wish to participate in the Meeting, you may submit the proxy
card included with this proxy statement or attend in person. Any proxy given by
you is revocable.
In the event that sufficient votes to approve the proposal are not
received by October 15, 1999, the persons named as proxies may propose one or
more adjournments of the Meeting to permit further solicitation of proxies. In
determining whether to adjourn the Meeting, the following factors may be
considered: the percentage of votes actually cast, the percentage of
negative votes actually cast, the nature of any further solicitation and the
information to be provided to shareholders with respect to the reasons for the
solicitation. Any such adjournment will require an affirmative vote of a
plurality 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 upon such
adjournment after consideration of all circumstances which may bear upon a
decision to adjourn the Meeting.
The Fund is not required nor does it intend to hold annual or any
other periodic meeting of shareholders except as may be required by the 1940
Act. If the Conversion is not approved by shareholders of the Fund, the next
meeting of the shareholders of the Fund will be held at such time as the Board
may determine or as may be legally required. Shareholders wishing to submit
proposals for consideration for inclusion in a proxy statement for a subsequent
shareholder meeting should send their written proposals to the Secretary of the
Trust at the address set forth on the cover of this proxy statement such that
they will be received by the Fund in a reasonable period of time prior to any
such meeting.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES AND THEIR
NOMINEES. Please advise the Fund whether other persons are beneficial owners of
shares for which proxies are being solicited and, if so, the number of copies of
this proxy statement needed to supply copies to the beneficial owners of the
respective shares.
ADDITIONAL INFORMATION
Payment of Expenses
FUNB will pay the expenses of the preparation, printing and mailing
to the Fund's shareholders of the proxy card, accompanying notice of meeting and
this proxy statement.
Beneficial Ownership
Exhibit D contains information about the beneficial ownership by
shareholders of five percent or more of the Fund's outstanding shares, as of
August 17, 1999. On that date, the existing Trustees and officers of the Fund,
together as a group, beneficially owned less than one percent of the Fund's
outstanding shares.
The term "beneficial ownership" is as defined under Section 13(d)
of the 1934 Act. The information as to beneficial ownership is based on
statements furnished to the Fund by the existing Trustees, officers of the
Trust, and/or on records of Mentor Service Company, Inc.
Annual and Semi-Annual Reports to Shareholders
The Fund will furnish, without charge, a copy of its most recent
annual report (and most recent semi-annual report succeeding the annual report,
if any) to a shareholder of the Fund upon request. Any such request should be
directed to Mentor Service Company, Inc. at 901 East Byrd Street, Richmond,
Virginia 23219 or 1-800-645-7816.
OTHER BUSINESS
The Board does not intend to present any other business at the
Meeting. If, however, any other matters are properly brought before the Meeting,
the persons named in the accompanying proxy card will vote thereon in accordance
with their judgment.
THE BOARD, INCLUDING ITS INDEPENDENT TRUSTEES, RECOMMENDS APPROVAL
OF THE PROPOSAL AND ANY UNMARKED PROXIES WITHOUT INSTRUCTIONS TO THE CONTRARY
WILL BE VOTED IN FAVOR OF APPROVAL OF THE PROPOSAL.
September __, 1999
<PAGE>
EXHIBIT A
[FORM OF AGREEMENT AND PLAN OF CONVERSION AND TERMINATION]
AGREEMENT AND PLAN OF CONVERSION AND TERMINATION dated
_____________, 1999 (the "Agreement"), between Mentor Institutional Trust, a
Massachusetts business trust having its principal office at 901 East Byrd
Street, Richmond, Virginia 23219 (the "Original Trust") on behalf of its SNAP
Fund (the "Original Fund"), one of the Original Trust's series portfolios, and
Evergreen Select Money Market Trust, a Delaware business trust having its
principal office at 200 Berkeley Street, Boston, Massachusetts 02116 (the
"Successor Trust") on behalf of its SNAP Fund (the "Successor Fund"), one of the
Successor Trust's series portfolios.
WHEREAS, the Board of Trustees of the Original Trust and the Board
of Trustees of the Successor Trust have respectively determined that it is in
the best interests of the Original Fund and the Successor Fund, respectively,
that the assets of the Original Fund be acquired by the Successor Fund pursuant
to this Agreement and in accordance with, respectively, the applicable laws of
the Commonwealth of Massachusetts and the State of Delaware; and
WHEREAS, the parties desire to enter into a plan of exchange which
would constitute a reorganization within the meaning of Section 368 of the
Internal Revenue Code of 1986, as amended (the "Code"):
NOW THEREFORE, in consideration of the premises and of the
covenants and agreements hereinafter set forth, the parties hereto agree as
follows:
1. PLAN OF EXCHANGE.
(a) Subject to the terms and conditions set forth herein, on
the Exchange Date (as defined herein), the Original Fund shall assign, transfer
and convey the assets, including all securities and cash held by the Original
Fund (subject to the liabilities of the Original Fund) to the Successor Fund and
the Successor Fund shall acquire all of the assets of the Original Fund (subject
to the liabilities of the Original Fund) in exchange for full and fractional
shares of beneficial interest of the Successor Fund, $.001 par value per share
(the "Successor Fund Shares"), to be issued by the Successor Trust on behalf of
the Successor Fund, having, in the case of the Successor Fund, an aggregate net
asset value equal to the value of the net assets of the Original Fund acquired.
The value of the assets of the Original Fund and the net asset value per share
of the Fund Shares of the Successor Fund shall be determined as of the
Valuation Date (as defined herein) in accordance with the procedures for
determining the value of the Original Fund's assets set forth in the
Successor Fund's Declaration of Trust and the then-current prospectus and
statement of additional information for the Successor Fund that forms a part
of the Successor Fund's Registration Statement on Form N-1A (the "Registration
Statement"). In lieu of delivering certificates for the Successor Fund Shares,
the Successor Trust shall credit the Fund Shares to the Original Fund's account
on the share record books of the Successor Trust and shall deliver a
confirmation thereof to the Original Fund. The Original Fund shall then deliver
written instructions to the Successor Trust's transfer agent to establish
accounts for the shareholders on the share record books relating to the Original
Fund. Holders of Class Y shares of the Original Fund shall receive in the
transaction described above, Institutional Class Shares of the Successor Fund.
Fund Shares of each such class shall have the same aggregate net asset value
as the aggregate net asset value of the corresponding class of the
Original Fund.
(b) Delivery of the assets of the Original Fund shall be made not
later than the next business day following the Valuation Date (the "Exchange
Date"). Assets transferred shall be delivered to State Street Bank and Trust
Company, the Successor Trust's custodian (the "Custodian"), for the account of
the Successor Trust and the Successor Fund, with all securities not in bearer or
book entry form duly endorsed, or accompanied by duly executed separate
assignments or stock powers, in proper form for transfer, with signatures
guaranteed, and with all necessary stock transfer stamps, sufficient to transfer
good and marketable title thereto (including all accrued interest and dividends
and rights pertaining thereto) to the Custodian for the account of the Successor
Trust and the Successor Fund free and clear of all liens, encumbrances, rights,
restrictions and claims. All cash delivered shall be in the form of immediately
available funds payable to the order of the Custodian for the account of the
Successor Trust and the Successor Fund. All assets delivered to the Custodian as
provided herein shall be allocated by the Successor Trust to the Successor Fund.
(c) The Original Fund will pay or cause to be paid to the
Successor Trust any interest received on or after the Exchange Date with
respect to assets transferred from the Original Fund to the Successor Fund
hereunder and to the Successor Trust any distributions, rights or other assets
received by the Original Fund after the Exchange Date as distributions on or
with respect to the securities transferred from the Original Fund to the
Successor Fund hereunder and the Successor Trust shall allocate any such
distributions, rights or other assets to the Successor Fund. All such assets
shall be deemed included in assets transferred to the Successor Fund on the
Exchange Date and shall not be separately valued.
(d) The Valuation Date shall be October 15, 1999, or such earlier
or later date as may be mutually agreed upon by the parties.
(e) As soon as practicable after the Exchange Date, the Original
Fund shall distribute all of the Successor Fund Shares received by it among the
shareholders of the Original Fund in proportion to the number of shares each
such shareholder holds in the Original Fund and, upon the effecting of such a
distribution on behalf of the Fund, the Original Fund will dissolve and
terminate. After the Exchange Date, the Original Fund shall not conduct any
business except in connection with its dissolution and termination.
2. THE ORIGINAL TRUST'S REPRESENTATIONS AND WARRANTIES. The
Original Trust represents and warrants to and agrees with the Successor Trust as
follows:
(a) The Original Trust is a business trust duly organized, validly
existing and in good standing under the laws of the Commonwealth of
Massachusetts and has power to own all of its properties and assets and, subject
to the approval of its shareholders as contemplated hereby, to carry out this
Agreement on behalf of the Original Fund.
(b) The Original Trust is registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), as an open-end management investment
company, and such registration has not been revoked or rescinded and is in full
force and effect.
(c) On the Exchange Date, the Original Trust will have full right,
power and authority to sell, assign, transfer and deliver the assets to be
transferred by it hereunder.
(d) The current prospectuses and statement of additional
information of the Original Fund conform in all material respects to the
applicable requirements of the Securities Act of 1933, as amended (the "1933
Act"), and the 1940 Act and the rules and regulations of the Securities and
Exchange Commission (the "Commission") thereunder and do not include any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(e) The Original Fund is not, and the execution, delivery, and
performance of this Agreement (subject to shareholder approval) will not result,
in violation of any provision of the Original Trust's Declaration of Trust or
By-Laws or of any material agreement, indenture, instrument, contract, lease, or
other undertaking to which the Original Trust or the Original Fund is a party or
by which it is bound.
(f) Except as otherwise disclosed in writing to and accepted by the
Successor Fund, no litigation, administrative proceeding, or investigation of or
before any court or governmental body is presently pending or to its knowledge
threatened against the Original Trust or the Original Fund or any of its or
their properties or assets, which, if adversely determined, would materially and
adversely affect their financial condition, the conduct of their business, or
the ability of the Original Trust or the Original Fund to carry out the
transactions contemplated by this Agreement. The Original Trust and the Original
Fund know of no facts that might form the basis for the institution of such
proceedings and are not parties to or subject to the provisions of any order,
decree, or judgment of any court or governmental body that materially and
adversely affects their business or their ability to consummate the transactions
herein contemplated.
(g) At the Exchange Date, there has not been any material adverse
change in the Original Fund's financial condition, assets, liabilities, or
business other than changes occurring in the ordinary course of business, or any
incurrence by the Original Fund of indebtedness maturing more than one year from
the date such indebtedness was incurred, except as otherwise disclosed to and
accepted by the Successor Trust. For the purposes of this subparagraph (h), a
decline in the net asset value of the Original Fund shall not constitute a
material adverse change.
(h) At the Exchange Date, all federal and other tax returns and
reports of the Original Fund required by law to have been filed by such dates
shall have been filed, and all federal and other taxes shown due on said returns
and reports shall have been paid, or provision shall have been made for the
payment thereof. To the best of the Original Trust's knowledge, no such return
is currently under audit, and no assessment has been asserted with respect to
such returns.
(i) For each fiscal year of its operation, the Original Fund has
met the requirements of Subchapter M of the Code for qualification and treatment
as a regulated investment company and has distributed in each such year all net
investment income and realized capital gains required to so qualify.
(j) All issued and outstanding shares of the Original Fund are, and
at the Exchange Date will be, duly and validly issued and outstanding, fully
paid and non-assessable by the Original Fund. All of the issued and outstanding
shares of the Original Fund will, at the time of the Exchange Date, be held by
the persons and in the amounts set forth in the records of the transfer agent.
The Original Fund does not have outstanding any options, warrants, or other
rights to subscribe for or purchase any of the Original Fund shares, nor
is there outstanding any security convertible into any of the Original Fund
shares.
(k) At the Exchange Date, the Original Trust will have good and
marketable title to the Original Fund's assets to be transferred to the
Successor Fund pursuant to Section 1 and full right, power, and authority to
sell, assign, transfer, and deliver such assets hereunder, and, upon delivery
and payment for such assets, the Successor Trust will acquire good and
marketable title thereto, subject to no restrictions on the full transfer
thereof, including such restrictions as might arise under the 1933 Act, other
than as disclosed to the Successor Trust and accepted by the Successor Trust.
(l) The execution, delivery, and performance of this Agreement have
been duly authorized by all necessary action on the part of the Original Fund
and, subject to the approval of the shareholders of the Original Trust on behalf
of the Original Fund, this Agreement constitutes a valid and binding obligation
of the Original Trust on behalf of the Original Fund, enforceable in accordance
with its terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights and to general equity principles.
(m) The information furnished by the Original Fund for use in
no-action letters, applications for orders, registration statements, proxy
materials, and other documents that may be necessary in connection with the
transactions contemplated hereby is accurate and complete in all material
respects and complies in all material respects with federal securities and other
laws and regulations thereunder applicable thereto.
3. THE SUCCESSOR TRUST'S REPRESENTATIONS AND WARRANTIES. The
Successor Trust represents and warrants to and agrees with the Original Trust as
follows:
(a) The Successor Trust is a business trust duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
power to carry on its business as it is now being conducted and to carry out
this Agreement on behalf of the Successor Fund.
(b) The Successor Trust is registered as an open-end management
investment company and adopts the Registration Statement of the Original Trust
and the Original Fund, for purposes of the 1933 Act.
(c) At the Exchange Date, the Fund Shares to be issued to the
Original Fund will have been duly authorized and, when issued and delivered
pursuant to this Agreement, will be legally and validly issued and will be
fully paid and non-assessable by the Successor Trust. No Successor Trust or
Successor Fund shareholder will have any preemptive right of subscription
or purchase in respect thereof.
(d) The current prospectuses and statement of additional
information of the Successor Fund conform in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and the rules and
regulations of the Commission thereunder and do not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(e) The Successor Fund is not, and the execution, delivery and
performance of this Agreement will not result, in violation of the Successor
Trust's Declaration of Trust or By-Laws or of any material agreement, indenture,
instrument, contract, lease, or other undertaking to which the Successor Trust
is a party or by which it is bound.
(f) Except as otherwise disclosed in writing to the Original Trust
and accepted by the Original Trust, no litigation, administrative proceeding or
investigation of or before any court or governmental body is presently pending
or to its knowledge threatened against the Successor Trust or any of its
properties or assets, which, if adversely determined, would materially and
adversely affect its financial condition and the conduct of its business or the
ability of the Successor Trust to carry out the transactions contemplated by
this Agreement. The Successor Trust knows of no facts that might form the basis
for the institution of such proceedings and is not a party to or subject to the
provisions of any order, decree, or judgment of any court or governmental body
that materially and adversely affects its business or its ability to consummate
the transactions contemplated herein.
(g) The Successor Fund has no known liabilities of a material
amount, contingent or otherwise.
(h) At the Exchange Date, there has not been any material adverse
change in the Successor Fund's financial condition, assets, liabilities, or
business other than changes occurring in the ordinary course of business, or any
incurrence by the Successor Fund of indebtedness maturing more than one year
from the date such indebtedness was incurred, except as otherwise disclosed to
and accepted by the Original Trust. For the purposes of this subparagraph (h), a
decline in the net asset value of the Successor Fund shall not constitute a
material adverse change.
(i) At the Exchange Date, all federal and other tax returns and
reports of the Successor Fund required by law then to be filed by such date
shall have been filed, and all federal and other taxes shown due on said returns
and reports shall have been paid or provision shall have been made for the
payment thereof. To the best of the Successor Trust's knowledge, no such return
is currently under audit, and no assessment has been asserted with respect to
such returns.
(j) For each fiscal year of its operation, the Successor Fund has
met the requirements of Subchapter M of the Code for qualification and treatment
as a regulated investment company and has distributed in each such year all net
investment income and realized capital gains required to so qualify.
(k) All issued and outstanding Successor Fund Shares are, and at
the Exchange Date will be, duly and validly issued and outstanding, fully paid
and non-assessable. The Successor Fund does not have outstanding any options,
warrants, or other rights to subscribe for or purchase any Successor Fund
Shares, nor is there outstanding any security convertible into any Successor
Fund Shares.
(l) The execution, delivery, and performance of this Agreement have
been duly authorized by all necessary action on the part of the Successor Trust,
and this Agreement constitutes a valid and binding obligation of the Successor
Trust enforceable in accordance with its terms, subject as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights and to general equity principles.
(m) The Successor Fund Shares to be issued and delivered to the
Original Fund, for the account of the Original Trust shareholders, pursuant to
the terms of this Agreement will, at the Exchange Date, have been duly
authorized and, when so issued and delivered, will be duly and validly issued
Successor Fund Shares, and will be fully paid and non-assessable.
(n) The information furnished by the Successor Trust for use in
no-action letters, applications for orders, registration statements, proxy
materials, and other documents that may be necessary in connection with the
transactions contemplated hereby is accurate and complete in all material
respects and complies in all material respects with federal securities and other
laws and regulations applicable thereto.
4. THE SUCCESSOR TRUST'S CONDITIONS PRECEDENT. The obligations of
the Successor Trust hereunder shall be subject to the following conditions:
(a) The Original Trust shall have furnished to the Successor Trust
a statement of the Original Fund's assets, including a list of securities owned
by the Original Fund with their respective tax costs and values determined as
provided in Section 1 hereof, all as of the Exchange Date.
(b) As of the Exchange Date, all representations and warranties of
the Original Trust on behalf of the Original Fund made in this Agreement shall
be true and correct as if made at and as of such date, and the Original Trust on
behalf of the Original Fund shall have complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied at or
prior to such date.
(c) For the Original Trust, a vote approving this Agreement and the
transactions and exchange contemplated hereby shall have been duly adopted by
the shareholders of the Original Fund.
(d) The Successor Trust shall have received on the Exchange Date an
opinion of Ropes & Gray, counsel to the Original Trust, dated as of the Exchange
Date, in a form satisfactory to the Successor Trust covering the following
points:
(i) The Original Fund is a separate investment series of a
Massachusetts business trust duly organized, validly existing and in good
standing under the laws of the Commonwealth of Massachusetts and has the power
to own all of its properties and assets and to carry on its business as
presently conducted.
(ii) The Original Fund is a separate investment series of a
Massachusetts business trust registered as an investment company under the 1940
Act, and, to such counsel's knowledge, such registration with the Commission as
an investment company under the 1940 Act is in full force and effect.
(iii)This Agreement has been duly authorized, executed and
delivered by the Original Trust and, assuming due authorization, execution, and
delivery of this Agreement by the Successor Trust, is a valid and binding
obligation of the Original Fund enforceable against the Original Fund in
accordance with its terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting creditors'
rights generally and to general equity principles.
(iv) To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental authority of the United
States or the Commonwealth of Massachusetts is required for consummation
by the Original Trust of the transactions contemplated herein, except such
as have been obtained under the 1933 Act, the 1934 Act and the 1940 Act, and as
may be required under state securities laws.
(v) The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not, result in a
violation of the Original Trust's Declaration of Trust or By-laws, or any
provision of any material agreement, indenture, instrument, contract, lease or
other undertaking (in each case known to such counsel) to which the Original
Trust is a party or by which it or any of its properties may be bound or, to the
knowledge of such counsel, result in the acceleration of any obligation or the
imposition of any penalty, under any agreement, judgment, or decree to which the
Original Trust is a party or by which it is bound.
(vi) Only insofar as they relate to the Original Trust, the
descriptions in the proxy materials of statutes, legal and government
proceedings and material contracts, if any, are accurate and fairly present the
information required to be shown.
(vii)To the knowledge of such counsel, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or threatened as to the Original Trust or
the Original Fund or any of its or their respective properties or assets and the
Original Trust and the Original Fund are neither parties to nor subject to the
provisions of any order, decree or judgment of any court or governmental body,
which materially and adversely affects their business other than as previously
disclosed in the proxy materials.
(viii) Assuming that a consideration therefor of not less than the
net asset value thereof has been paid, and assuming that such shares were issued
in accordance with the terms of the Original Fund's registration statement, or
any amendment thereto, in effect at the time of such issuance, all issued and
outstanding shares of the Original Fund are legally issued and fully paid and
non-assessable.
Such opinion shall contain such other assumptions and limitations as shall be in
the opinion of Ropes & Gray appropriate to render the opinions expressed
therein.
5. THE ORIGINAL TRUST'S CONDITIONS PRECEDENT. The obligations of
the Original Trust hereunder shall be subject to the following conditions: (a)
that as of the Exchange Date all representations and warranties of the Successor
Trust made in the Agreement shall be true and correct as if made at and as of
such date, and that the Successor Trust shall have complied with all of the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such date.
(b) The Original Trust shall have received on the Exchange Date an
opinion from Sullivan & Worcester LLP, counsel to the Successor Trust, dated as
of the Exchange Date, in a form reasonably satisfactory to the Original Trust,
covering the following points:
(i) The Successor Fund is a separate investment series of a
Delaware business trust duly organized, validly existing and in good standing
under the laws of the State of Delaware and has the power to own all of its
properties and assets and to carry on its business as presently conducted.
(ii) The Successor Fund is a separate investment series of a
Delaware business trust registered as an investment company under the 1940 Act,
and, to such counsel's knowledge, such registration with the Commission as an
investment company under the 1940 Act is in full force and effect.
(iii)This Agreement has been duly authorized, executed, and
delivered by the Successor Trust and, assuming due authorization, execution and
delivery of this Agreement by the Original Trust, is a valid and binding
obligation of the Successor Trust enforceable against the Successor Trust in
accordance with its terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally and to general equity principles.
(iv) The Successor Fund Shares to be issued and delivered to the
Original Trust on behalf of the Original Fund Shareholders as provided by this
Agreement are duly authorized and upon such delivery will be legally issued and
outstanding and fully paid and non-assessable, and no shareholder of the
Successor Fund has any preemptive rights in respect thereof.
(v) To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental authority of the United
States or the State of Delaware is required for consummation by the Successor
Trust of the transactions contemplated herein, except such as have been obtained
under the 1933 Act, the Securities Exchange Act of 1934, as amended and the 1940
Act, and as may be required under state securities laws.
(vi) The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not, result in a
violation of the Successor Trust's Declaration of Trust or By-Laws or any
provision of any material agreement, indenture, instrument, contract, lease or
other undertaking (in each case known to such counsel) to which the Successor
Trust is a party or by which it or any of its properties may be bound or to the
knowledge of such counsel, result in the acceleration of any obligation or the
imposition of any penalty, under any agreement, judgment, or decree to which the
Successor Trust is a party or by which it is bound.
(vii)Only insofar as they relate to the Successor Trust and the
Successor Fund, the descriptions in the proxy materials of statutes, legal and
governmental proceedings and material contracts, if any, are accurate and fairly
present the information required to be shown.
(viii) Such counsel does not know of any legal or governmental
proceedings, only insofar as they relate to the Successor Trust and the
Successor Fund, existing on or before the effective date of the proxy materials
or the Exchange Date required to be described in the proxy materials which are
not described or filed as required.
(ix) To the knowledge of such counsel, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or threatened as to the Successor Trust
or any of its properties or assets and the Successor Trust is not a party to or
subject to the provisions of any order, decree or judgment of any court or
governmental body, which materially and adversely affects its business, other
than as previously disclosed in the proxy materials.
Such opinion shall contain such assumptions and limitations as shall be in the
opinion of Sullivan & Worcester LLP appropriate to render the opinions expressed
therein.
6. THE SUCCESSOR TRUST'S AND THE ORIGINAL TRUST'S CONDITIONS
PRECEDENT. The obligations of both the Successor Trust and the Original Trust
hereunder as to the Successor Fund and the Original Fund respectively, shall be
subject to the following conditions:
(a) The receipt of such authority, including "no-action" letters
and orders from the Commission or state securities commissions, as may be
necessary to permit the parties to carry out the transaction contemplated by
this Agreement shall have been received.
(b) The Successor Trust's adoption of the Registration Statement on
Form N-1A under the 1933 Act shall have become effective, and any post-effective
amendments to such Registration Statement as are determined by the Trustees of
the Successor Trust to be necessary and appropriate, shall have been filed with
the Commission and shall have become effective.
(c) The Commission shall not have issued an unfavorable advisory
report under Section 25(b) of the 1940 Act nor instituted nor threatened to
institute any proceeding seeking to enjoin consummation of the reorganization
transactions contemplated hereby under Section 25(c) of the 1940 Act and no
other action, suit or other proceeding shall be threatened or pending before any
court or governmental agency which seeks to restrain or prohibit, or obtain
damages or other relief in connection with, this Agreement or the transactions
contemplated herein.
(d) All required consents of other parties and all other consents,
orders, and permits of federal, state and local regulatory authorities
(including those of the Commission and of state Blue Sky securities authorities,
including any necessary "no-action" positions of and exemptive orders from such
federal and state authorities) to permit consummation of the transactions
contemplated hereby shall have been obtained, except where failure to obtain any
such consent, order, or permit would not involve a risk of a material adverse
effect on the assets or properties of the Successor Fund or the Original Fund,
provided that either party hereto may for itself waive any of such conditions.
(e) The parties shall have received a favorable opinion of Sullivan
& Worcester LLP addressed to the Successor Trust and the Original Trust
substantially to the effect that for federal income tax purposes:
(i) The transfer of all of the Original Fund assets in exchange for
the Successor Fund Shares and the assumption by the Successor Fund of all the
liabilities of the Original Fund followed by the distribution of the Successor
Fund Shares to the Original Fund shareholders in dissolution and liquidation of
the Original Fund will constitute a "reorganization" within the meaning of
Section 368(a)(1)(F) of the Code and the Successor Fund and the Original Fund
will each be a "party to a reorganization" within the meaning of Section 368(b)
of the Code.
(ii) No gain or loss will be recognized by the Successor Fund upon
the receipt of the assets of the Original Fund solely in exchange for the
Successor Fund Shares and the assumption by the Successor Fund of the
liabilities of the Original Fund.
(iii) No gain or loss will be recognized by the Original Fund upon
the transfer of the Original Fund assets to the Successor Fund in exchange for
the Successor Fund Shares and the assumption by the Successor Fund of the
liabilities of the Original Fund or upon the distribution (whether actual or
constructive) of the Successor Fund Shares to Original Fund shareholders in
exchange for their shares of the Original Fund.
(iv) No gain or loss will be recognized by the Original Fund
Shareholders upon the exchange of their Original Fund shares for the Successor
Fund Shares in liquidation of the Original Fund.
(v) The aggregate tax basis for the Successor Fund Shares received
by each Original Fund shareholder pursuant to the transactions contemplated by
this Agreement will be the same as the aggregate tax basis of the Original Fund
shares held by such shareholder immediately prior to the transactions
contemplated by this Agreement, and the holding period of the Successor Fund
Shares to be received by each Original Fund Shareholder will include the period
during which the Original Fund shares exchanged therefor were held by such
shareholder (provided the Original Fund shares were held as capital assets on
the date of the transactions contemplated by this Agreement).
(vi) The tax basis of the Original Fund assets acquired by the
Successor Fund will be the same as the tax basis of such assets to the Original
Fund immediately prior to the transactions contemplated by this Agreement, and
the holding period of the assets of the Original Fund in the hands of the
Successor Fund will include the period during which those assets were held by
the Original Fund.
Notwithstanding anything herein to the contrary, neither the
Successor Fund nor the Original Fund may waive the conditions set forth in
Section 6.
Provided, however, that at any time prior to the Exchange Date, any
of the foregoing conditions in this Section 6 may be waived by the parties if,
in the judgment of the parties, such waiver will not have a material adverse
effect on the benefits intended under the Agreement to the shareholders of the
Original Fund.
7. INDEMNIFICATION. The Successor Trust hereby agrees with the
Original Trust and each Trustee of the Original Trust: (i) to indemnify each
Trustee of the Original Trust against all liabilities and expenses referred to
in the indemnification provisions of the Original Trust's organizational
documents, to the extent provided therein, incurred by any Trustee of the
Original Trust; and (ii) in addition to the indemnification provided in (i)
above, to indemnify each Trustee of the Original Trust against all liabilities
and expenses and pay the same as they arise and become due, without any
exception, limitation or requirement of approval by any person, and without any
right to require repayment thereof by any such Trustee (unless such Trustee
has had the same repaid to him or her) based upon any subsequent or final
disposition or findings made in connection therewith or otherwise, if such
action, suit or other proceeding involves such Trustee's participation in
authorizing or permitting or acquiescing in, directly or indirectly, by action
or inaction, the making of any distribution in any manner of all or any assets
of the Original Fund without making provision for the payment of any
liabilities of any kind, fixed or contingent, of the Original Fund, which
liabilities were not actually and consciously personally known to such Trustee
to exist at the time of such Trustee's participation in so authorizing or
permitting or acquiescing in the making of any such distribution.
8. TERMINATION OF AGREEMENT. As to the Original Fund and the
corresponding Successor Fund, this Agreement and the transactions contemplated
hereby may be terminated and abandoned by resolution of the Board of Trustees of
the Original Trust or the Board of Trustees of the Successor Trust, at any time
prior to the Exchange Date (and notwithstanding any vote of the shareholders of
the Original Fund) if circumstances should develop that, in the opinion of
either the Board of Trustees of the Original Trust or the Board of Trustees of
the Successor Trust, make proceeding with this Agreement inadvisable.
As to the Original Fund and the Successor Fund, if this Agreement
is terminated and the exchange contemplated hereby is abandoned pursuant to the
provisions of this Section 8, this Agreement shall become void and have no
effect, without any liability on the part of any party hereto or the Trustees,
officers or shareholders of the Successor Trust or the Trustees, officers or
shareholders of the Original Trust, in respect of this Agreement.
9. WAIVER AND AMENDMENTS. At any time prior to the Exchange Date,
any of the conditions set forth in Section 4 may be waived by the Board of
Trustees of the Successor Trust, and any of the conditions set forth in Section
5 may be waived by the Board of Trustees of the Original Trust, if, in the
judgment of the waiving party, such waiver will not have a material adverse
effect on the benefits intended under this Agreement to the shareholders of the
Original Fund or the shareholders of the Successor Fund, as the case may be. In
addition, prior to the Exchange Date, any provision of this Agreement may be
amended or modified by the Board of Trustees of the Original Trust and the Board
of Trustees of the Successor Trust in such manner as may be mutually agreed upon
in writing by such Trustees if such amendment or modification would not have a
material adverse effect upon the benefits intended under this Agreement and
would be consistent with the best interests of shareholders.
10. NO SURVIVAL OF REPRESENTATIONS. None of the representations and
warranties included or provided for herein shall survive consummation of the
transactions contemplated hereby.
11. GOVERNING LAW. This Agreement shall be governed and construed
in accordance with the laws of the State of Delaware, without giving effect to
principles of conflict of laws; provided, however, that the due authorization,
execution and delivery of this Agreement, in the case of the Original Trust,
shall be governed and construed in accordance with the laws of the Commonwealth
of Massachusetts without giving effect to principles of conflict of laws.
12. CAPACITY OF TRUSTEES, ETC. With respect to both the Original
Trust and the Successor Trust, the names used herein refer respectively to the
Trust created and, as the case may be, the Trustees, as trustees but not
individually or personally, acting from time to time under organizational
documents filed in Massachusetts in the case of the Original Trust and Delaware,
in the case of the Successor Trust, which are hereby referred to and are also on
file at the principal offices of the Original Trust or, as the case may be, the
Successor Trust. The obligations of the Original Trust or of the Successor Trust
entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents of the Original Trust or the Successor Trust, as the
case may be, are made not individually, but in such capacities, and are not
binding upon any of the Trustees, shareholders or representatives of the
Original Trust or, as the case may be, the Successor Trust personally, but bind
only the trust property, and all persons dealing with any Original Fund of the
Original Trust or any Successor Fund of the Successor Trust must look solely to
the trust property belonging to such Original Fund or, as the case may be,
Successor Fund for the enforcement of any claims against the Original Fund or,
as the case may be, Successor Fund.
13. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which, when executed and delivered, shall be deemed to be an original.
IN WITNESS WHEREOF, the Original Trust and the Successor Trust have
caused this Agreement and Plan of Conversion and Termination to be executed as
of the date above first written.
[Original Trust on behalf of]
[Original Fund]
ATTEST:_______________________ By:_____________________
Title:
[Successor Trust]
on behalf of
[Successor Fund]
ATTEST:_______________________ By:_____________________
Title:
<PAGE>
EXHIBIT B
MANAGEMENT OF THE SUCCESSOR TRUST
The Successor Trust is supervised by a Board of Trustees that is
responsible for representing the interests of the shareholders. The Trustees
meet periodically throughout the year to oversee the Successor Fund's
activities, reviewing, among other things, the Successor Fund's performance and
its contractual arrangements with various service providers. Each Trustee is
paid a fee for his or her services.
The Successor Trust has an Executive Committee which consists of the
Chairman of the Board, James Howell, and Messrs. Scofield and Salton, each of
whom is an Independent Trustee. The Executive Committee recommends Trustees to
fill vacancies, prepares the agenda for Board meetings and acts on routine
matters between scheduled Board meetings.
Set forth below are the Trustees and officers of the Successor Trust
and their principal occupations and affiliations over the last five years.
Unless otherwise indicated, the address for each Trustee and officer is 200
Berkeley Street, Boston, Massachusetts 02116. Each Trustee is also a Trustee of
each of the other Trusts in the Evergreen Fund complex.
<TABLE>
<CAPTION>
Name Position with Principal Occupations for Last Five Years
Trust
<S> <C> <C>
Laurence B. Ashkin Trustee Real estate developer and construction
(DOB: 2/2/28) consultant; and President of Centrum
Equities (real estate development) and
Centrum Properties, Inc.
Charles A. Austin III Trustee Investment Counselor to Appleton Partners,
(DOB: 10/23/34) Inc.(investment advice); former Director,
Executive Vice President and Treasurer,
State Street Research & Management
Company (investment advice); Director,
the Andover Companies (Insurance); and
Trustee, Arthritis Foundation of New England
K. Dun Gifford Trustee Trustee, Treasurer and Chairman of the
(DOB: 10/12/38) Finance Committee, Cambridge College;
Chairman Emeritus and Director, American
Institute of Food and Wine; Chairman and
President, Oldways Preservation and
Exchange Trust (education);former Chairman of
the Board, Director, and Executive Vice
President, The London Harness Company (leather
goods purveyor); former Managing Partner,
Roscommon Capital Corp.; former Chief
Executive Officer, Gifford Gifts of
Fine Foods; former Chairman, Gifford,
Drescher & Associates (environmental
consulting)
James S. Howell Chairman of Former Chairman of the Distribution
(DOB: 8/13/24) the Board of Trustees Committee Foundation for the Carolinas;
and former Vice President of Lance Inc.
(food manufacturing).
Leroy Keith, Jr. Trustee Chairman of the Board and Chief Executive
(DOB: 2/14/39) Officer, Carson Products Company
(manufacturing); Director of Total
Return Fund and Equifax, Inc.(worldwide
information management); Trustee of Phoenix
Series Fund, Phoenix Multi-Portfolio
Fund, and The Phoenix Big Edge Series Fund;
and former President, Morehouse College.
Gerald M. McDonnell Trustee Sales Representative with Nucor-Yamoto,
DOB: 7/14/39) Inc. (steel producer).
Thomas L. McVerry Trustee Former Vice President and Director of
(DOB: 8/2/39) Rexham Corporation (manufacturing); and
former Director of Carolina Cooperative
Federal Credit Union.
William Walt Pettit Trustee Partner in the law firm of William Walt
(DOB: 8/26/55) Pettit, P.A.
David M. Richardson Trustee Vice Chair and former Executive Vice
(DOB: 9/14/41) President, DHR International, Inc. (executive
recruitment); former Senior Vice President,
Boyden International Inc. (executive
recruitment); and Director, Commerce and
Industry Association of New Jersey, 411
International, Inc.(communications), and
J&M Cumming Paper Co.
Russell A. Salton, III, MD Trustee Medical Director, U.S. Health Care/Aetna
(DOB: 6/2/47) Health Services; former Managed Health
Care Consultant; and former President,
Primary Physician Care.
Michael S. Scofield Vice Chairman Attorney, Law Offices of Michael S.
(DOB: 2/20/43) of the Board of Trustees Scofield.
Richard J. Shima Trustee Former Chairman, Environmental Warranty,
(DOB: 8/11/39) Inc. (insurance agency); Executive
Consultant, Drake Beam Morin, Inc.
(executive outplacement); Director of
Connecticut Natural Gas Corporation-
Hartford Hospital, Old State House
Association, Middlesex Mutual
Assurance Company (property casualty
insurance), and Enhance Financial
Services, Inc. (financial guaranty
insurance); Chairman, Board of
Trustees, Hartford Graduate Center;
Trustee, Greater Hartford YMCA;
former Director, Vice Chairman and
Chief Investment Officer, The
Travelers Corporation; former Trustee,
Kingswood-Oxford School; and former
Managing Director and Consultant,
Russell Miller, Inc.(investment
banking specializing in the insurance
industry)
Anthony J. Fischer* President and Treasurer [Vice President/Client Services, BISYS Fund
(DOB: 2/20/59) Services.]
Nimish S. Bhatt** Vice President Vice President, Tax, BISYS Fund Services;
(DOB: 6/6/63) and Assistant Treasurer Assistant Vice President, Evergreen Asset
Management Corp./First Union Bank; former
Senior Tax Consulting/Acting Manager,
Investment Companies Group,
Pricewaterhouse Coopers LLP, New York.
Bryan Haft** Vice President Team Leader, Fund Administration, BISYS
(DOB: 1/23/65 Fund Services
Michael H. Koonce Secretary Senior Vice President and Assistant
(DOB: 4/20/60) General Counsel, First Union Corporation;
former Senior Vice President and General
Counsel, Colonial Management Association,
Inc.
</TABLE>
o Address: BISYS, 90 Park Avenue, 10th Floor, New York New York 10016
**Address: BISYS, 3435 Stelzer Road, Columbus, Ohio 43219-8001
Trustee Compensation
Listed below is the Trustee compensation paid by the Successor Trust
for the twelve months ended April 30, 1999. The Trustees do not receive pension
or retirement benefits from the Fund.
Trustee Total Compensation from the
Successor Trust Paid to Trustees*
Laurence B. Ashkin...............................$75,000
Charles A. Austin, III...........................$75,000
K. Dun Gifford...................................$72,500
James S. Howell..................................$97,500
Leroy Keith, Jr..................................$72,500
Gerald M. McDonnell..............................$75,000
Thomas L. McVerry................................$86,000
William Walt Pettit..............................$72,500
David M. Richardson..............................$71,875
Russell A. Salton, III MD........................$77,500
Michael S. Scofield..............................$77,500
Richard J. Shima.................................$72,500
*Certain Trustees have elected to defer all or part of their
total compensation for the twelve months ended April 30, 1999.
The amounts listed below will be payable in later years to the
respective Trustees:
Charles A. Austin III.............................$11,250
James S.Howell....................................$77,600
Gerald M. McDonnell...............................$75,000
Thomas L. McVerry.................................$86,000
William Walt Pettit...............................$72,500
Russell A. Salton, III, MD........................$77,000
Michael S. Scofield...............................$11,250
EXHIBIT C
NUMBER OF SHARES OF THE FUND
OUTSTANDING AS OF THE CLOSE OF BUSINESS ON
AUGUST 17, 1999
Mentor Institutional Trust
SNAP Fund
Class Y 1,138,884,396.110
EXHIBIT D
VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF
As of August 17, 1999 (the Record Date), the Trustees and Officers of
each Fund owned as a group less than 1% of the outstanding voting securities of
any Fund. As of the Record Date, the following shareholders were known to the
Mentor Trusts to own beneficially 5% or more of the shares of the Fund:
Percentage of
Name and Address Outstanding
Name of Fund Class of Record Owner Shares of Class
SNAP Fund Y Treasury Board of 100%
the Commonwealth
of Virginia
101 North 14th Street
Richmond, VA 23218
<PAGE>
MENTOR INSTITUTIONAL TRUST
EVERY SHAREHOLDER'S VOTE IS IMPORTANT!
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
Please detach at perforation before mailing.
SPECIAL MEETING OF SHAREHOLDERS - OCTOBER 15, 1999
The undersigned hereby appoints Paul F. Costello, Gordon Forrester, Michael H.
Koonce and Maureen E. Towle and each of them, attorneys and proxies for the
undersigned, with full powers of substitution and revocation, to represent the
undersigned and to vote on behalf of the undersigned all shares of the SNAP Fund
(the "Fund"), which the undersigned is entitled to vote at a Meeting of
Shareholders of the Fund to be held at the offices of Mentor Institutional Trust
at 901 East Byrd Street, Richmond, Virginia 23219 on October 15, 1999, at 2:00
p.m. and any adjournments thereof (the "Meeting"). The undersigned hereby
acknowledges receipt of the Notice of Meeting and Proxy Statement, and hereby
instructs said attorneys and proxies to vote said shares as indicated hereon.
Unless indicated to the contrary, this proxy shall be deemed to grant authority
to vote "FOR" all proposals relating to the Fund. In their discretion, the
proxies are authorized to vote upon such other matters as may properly come
before the Meeting. A majority of the proxies present and acting at the meeting
in person or by substitute (or, if only one shall be so present, then that one)
shall have and may exercise all of the powers and authority of said proxies
hereunder. The undersigned hereby revokes any proxy previously given.
NOTE: PLEASE SIGN EXACTLY
AS YOUR NAMES APPEAR ON
THIS PROXY. If joint
owners, EITHER may sign
this Proxy. When signing as
attorney, executor,
administrator, trustee,
guardian, or custodian for
a minor, please give your
full title. When signing on
behalf of a corporation or
as a partner for a
partnership, please give
the full corporate or
partnership name and your
full title.
Date: , 1999
Signature(s)
Title(s), if applicable
<PAGE>
MENTOR INSTITUTIONAL TRUST
EVERY SHAREHOLDER'S VOTE IS IMPORTANT!
PLEASE SIGN, DATE AND RETURN YOUR PROXY
TODAY!
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES. PLEASE INDICATE YOUR
VOTE BY PLACING AN "x" IN THE APPROPRIATE BOX BELOW. THIS PROXY WILL BE VOTED AS
SPECIFIED BELOW WITH RESPECT TO THE ACTION TO BE TAKEN ON THE FOLLOWING
PROPOSALS. IN THE ABSENCE OF ANY SPECIFICATION, THIS PROXY WILL BE VOTED IN
FAVOR OF THE PROPOSALS.
<TABLE>
<CAPTION>
For Against Abstain
<S> <C> <C> <C>
1. To approve the proposed Agreement and Plan [ ] [ ] [ ]
of Conversion and Termination into the
SNAP Fund, a series of Evergreen Select
Money Market Trust of the SNAP Fund, a series
of Mentor Institutional Trust.
2. To transact any other business that may [ ] [ ] [ ]
properly come before the meeting or any
adjournment thereof.
</TABLE>
